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07.10.13 OSBT cip-complete AGENDA ITEM 5 PAGE 1 C I T Y O F B O U L D E R OPEN SPACE BOARD OF TRUSTEES AGENDA ITEM MEETING DATE: July 10, 2013 AGENDA TITLE Review of the 2014 Open Space and Mountain Parks Department Budget and recommend approval of the 2014 Open Space and Mountain Parks Department Capital Improvement Program Budget and a portion of the Lottery Fund Capital Improvement Program Budget. PRESENTERS Michael D. Patton, Director, Open Space and Mountain Parks Michael Orosel, Financial Services Manager, Central Services PURPOSE This is a request for the Open Space Board of Trustees (OSBT) to: Review the recommended 2014 Open Space and Mountain Parks (OSMP) Department Budget; and, Review, approve and recommend that the Planning Board approve the Open Space and Mountain Parks Department’s 2014 Capital Improvement Program (CIP) budget of $7,010,000 and make a recommendation concerning allocation of a portion of the city’s Lottery Fund Capital Improvement Program Budget in the amount of $343,000 in 2014. AGENDA ITEM 5 PAGE 2 2014 BUDGET OVERVIEW (Prepared 6/21/2013) SOURCES OF FUNDS Proposed 2014 Budget % Net Sales Tax Income: $26,295,672 91.59% Investment Income: $325,000 1.13% Lease & Misc. Income: $485,909 1.69% Subtotal - OS Fund Sources of Funds: $27,106,581 94.42% General Fund Appropriation for OSMP: $1,103,480 3.84% General Fund Appropriation for RE Svcs: $156,062 0.54% Lottery Fund CIP Appropriation for OSMP: $343,000 1.19% Subtotal - Non-OS Fund Sources of Funds: $1,602,542 5.58% Total Sources of OSMP Funds: $28,709,123 100.00% USES OF FUNDS Personnel Expenditures: $9,250,308 33.15% Non-Personnel Expenditures: $3,471,054 12.44% Subtotal - Management Budget: $12,721,362 45.59% Cost Allocation Transfer to General Fund: $1,108,400 3.97% Subtotal Operating Expenditures: $13,829,762 49.56% Open Space Fund CIP: $7,010,000 25.12% Lottery Fund CIP: $343,000 1.23% Debt Service Payments: $6,722,082 24.09% Subtotal CIP & Debt Pmt Expenditures: $14,075,082 50.44% Total OSMP Uses of Funds (1) $27,904,844 100.00% (1) Includes Transfer to the Fire Dept Budget of : $84,854 Includes GF Funding for RE Services of: $156,602 AGENDA ITEM 5 PAGE 3 EXECUTIVE SUMMARY The purpose of this agenda item is for the OSBT to review the department’s recommended budget as it relates to open space matters and operations and to review the 2014 CIP budget and make recommendations. Most recently, the Budget Office projected 2013 sales tax revenue to increase 2.27 percent from 2012 actual sales tax revenue and future years' revenue to increase in the range of 3.50 percent in 2014 to 3.20 percent in 2019. The total combined revenue from sales and use tax collected by the city makes up approximately 92 percent of the department’s revenue. The Open Space (OS) Fund sales tax base of 0.88 percent is made up of three components: 0.33 percent that will sunset at the end of 2018; 0.15 percent that will sunset at the end of 2019; and 0.40 percent that has no sunset and is projected to provide the base for ongoing expenditures in 2020 and thereafter. The 2013 sales tax revenue is currently projected to be $25,406,420, an increase of $563,257 over actual 2012 sales tax revenue. Through April 2013, sales tax revenues for the year to date are 4.92 percent above 2012 actual revenue year to date. The proposed 2014 budget reflects OSBT goals of maintaining both stewardship of present open space lands and preserving additional acres, within the financial sustainability of the Open Space Fund; the attached Open Space Fund Financial for 2012-2019 reflects the funding that supports it. The attached Fund Financial models staff recommended expenditures for 2014 and thereafter which have not yet been approved by either the city manager or the City Council. The proposed 2014 Capital Improvement Plan (CIP) budget for the Open Space and Mountain Parks Department increases funds for the Real Estate Acquisition CIP to $5,400,000, with the Mineral Rights and Water Rights CIPs remaining at $100,000 and $200,000 respectively. The Visitor Infrastructure CIP for 2013 is $1,310,000 and will continue an aggressive implementation of the West Trail Study Area (TSA) Plan and to fund three projects not associated with the West TSA Plan (South Boulder Creek Instream Flow Project, the North TSA and Visitor Infrastructure system wide). These uses of funds will be sustainable under the current Budget Office revenue projections. The Lottery Fund CIP funding for capital projects within the mountain backdrop remains at $343,000 in 2014. Lottery funding allocated to OSMP is projected increase to $355,300 from 2015 through 2019. STAFF RECOMMENDATION Staff recommends and requests that the Open Space Board of Trustees make the following motion: Approve, and recommend that Planning Board approve an appropriation of $7,010,000 in 2014 from the Open Space Fund CIP as outlined in this memorandum and related attachments; and recommend that $343,000 be appropriated from the city's Lottery Fund CIP in 2014 as outlined in this memorandum and related attachments. AGENDA ITEM 5 PAGE 4 COMMUNITY SUSTAINABILITY ASSESSMENTS AND IMPACTS • Environmental: Open Space and Mountain Parks is a significant community-based program that preserves open space land contributing to the environmental sustainability goal of the City Council. • Economic: The Open Space and Mountain Parks program contributes to council’s economic sustainability goal, because it provides the physical context for the diverse and vibrant economic system that supports services for residents. The land system and the quality of life it represents attract visitors and help businesses to recruit and retain quality employees. • Social: The Open Space land system is accessible to all members of the community and therefore helps support council’s community sustainability goal because all residents “who live in Boulder can feel a part of and thrive in” this aspect of their community. OTHER IMPACTS • Fiscal: Sufficient funds are available in the Open Space Fund to cover the proposed 2014 Operating and Capital Improvement Program budgets as summarized in the attached Open Space Fund Financial 2012–2019 (Attachment A). • Staff Time: The budget is the financial representation of the departmental work plan. Preparation and management of the budget are part of the normal work plan. PUBLIC FEEDBACK This item is being heard at this public meeting advertised in the Daily Camera on July 7, 2013. On July 25, 2013 the City Planning Board is scheduled to review the 2014-2019 CIP as recommended by staff. On August 13, 2013 the City Council will hold its CIP study session. With regards to the 2014 operating budget, City Council study sessions are scheduled on Sept. 10 and Sept. 24. First and second readings of the 2013 Budget ordinances are scheduled for Oct. 1 and Oct. 15 respectively. ANALYSIS Services and Operating Expenditures Background The department has based its 2014 budget on revenue projections for 2013 and future years. The 2014 budget for OSMP has been prepared recognizing that both the Board and council desire an expedited implementation of the West TSA Plan, implementation of an enhanced Voice and Sight Tag Program and implementation of the recently-approved update to the Real Estate Acquisition Plan. Increases are proposed in standard staff (four-year fixed term), seasonal funding and nonpersonnel expenses. In addition, council is in the process of determining what new revenue measures it wants to include on the 2013 ballot, including any extension of taxes dedicated to fund the Open Space Fund. 2014 Request Funds totaling $163,000 are requested to implement the enhanced Voice and Sight (dog) Tag Program in 2014. The Voice and Sight Tag Program was originally provided for in the Visitor Master Plan (VMP) that was approved by council in April 2005. The program was originally developed as a pilot program and after six years, changes are needed. OSMP was instructed to AGENDA ITEM 5 PAGE 5 recommend an enhanced Voice and Sight Tag Program which OSMP has presented to council. The entire enhanced program was not approved by council; however it is anticipated that a revised program will be approved in 2013 and these funds represent the maximum required for continuing the program in 2014. A total of $61,658 is requested to add mobile data centers (computers) to six ranger vehicles that do not have them. Included are the cost of the computers and associated hardware, mounts, timers, power supply, antenna and installation. Funding is also included for the annual cost of modems and maintenance and operation for the ranger radio frequency. This equipment will increase the safety and productivity of rangers as well as assist with the implementation of new voice and sight regulations. The enhanced computer equipment has become the standard for all emergency response vehicles in the city and provides up to the minute information on location, nature of calls and officer status to the dispatch center and other officers. In addition, the computers allow rangers to complete reports and access the ranger database without necessitating returning to the office, resulting in less travel time and increased ranger presence in the field. Related to the above, ‘additional computer terminals’ is a request for $25,500 as an increase to the computer replacement fund (CRF). This increase in the contribution to the CRF is necessary due to the computers in ranger vehicles, the Resource Information Systems’ new hire and for the servers housed at the jail - OSMPgis and OSMPmap. Funds totaling $75,000 are requested to provide resources for Ecological Systems staff to restore land along South Boulder Creek from Baseline Road to South Mesa Trailhead by removing non- native trees. In addition, land along east Boulder Creek will be restored by removing nonnative trees and pond restoration on the Culver, Hartnagel and ERTL properties. For 2014, it is proposed that a four-year, fixed term standard position of Water Resources Technician be authorized at an estimated cost of $66,202. OSMP has an extensive water portfolio and this position will provide for a successor should the incumbent in the standard on- going position retire. In addition, the expansion of Gross Reservoir and associated memoranda of understanding will add reporting duties and require infrastructure installations by OSMP; these additional duties are not identified in the existing job description. Funds totaling $45,000 are requested to reinstitute the issuance of resource research grants to be conducted to help guide management actions related to VMP, TSA plans, the Grassland Ecosystem Management Plan and the Forest Ecosystem Management Plan (FEMP). OSMP at one time funded this program at approximately $80,000; funds were deleted at the time of the economic turndown. A total of $80,000 is requested to purchase a chipper ($70,000) and a trailer ($10,000). At present, OSMP has two chippers that are used by two FEMP crews and one Integrated Pest Management crew. A third chipper will be purchased and will preclude the necessity to schedule work based on the availability of a chipper; each crew will have an assigned chipper. A 0.50 four-year, fixed term position will update and maintain the Cultural Resource Management database, including site condition assessments and GPS locations; develop AGENDA ITEM 5 PAGE 6 accession and collection system; develop archaeology best management practices; and assist with interdepartmental review of work plans where there may be an intersection with cultural resources. Funds totaling $30,000 are requested for this 0.50 fixed term position. Funds totaling $21,700 are requested for the Resource Information Services group for a six- month seasonal employee to complete fence data collection started in 2013 and to continue mapping conservation easements and fee properties not managed by OSMP. In addition, funding for one month of a seasonal employee is included to update the library holdings. The Resource Information System group supports all groups at OSMP. Over the past few years, OSMP’s seasonal trails staffing has increased significantly to address city council directed rapid completion of the West TSA. However, over that same period, the standard staff overseeing these activities has not increased while, as indicated above, seasonal trails staffing has increased. This has caused capacity issues in that the standard staff plan projects, oversee project quality and progress, supervise seasonal staff, assist with the hiring of the trail crews and provide greater outreach. OSMP needs additional standard positions to effectively plan and implement maintenance efforts to prevent significant repair costs in the future. To this end, $128,741 is requested to fund two standard four-year fixed term positions. In conjunction with the funding of two Maintenance III/Trails Specialist standard positions, OSMP will reduce funding for seasonal trail crew leads by $85,400, therefore the net increase to fund the two new standard positions will be $43,341. Requested funding of $37,000 will permit repairs to the Weiser House, Stockton and McGilvery cabins, Viele barn and Hedgecock Milk House within the Cultural Resources Program. Requested funds to repair the Weiser House total $12,000 and is self funding as the Weiser House is a rental and the rent will provide the funds for the repairs. Repairs to the structures include replacing shingles, mortar repair, carpentry and roof repair. Should these repairs not be made, these structures will continue to deteriorate and future repairs will most likely be more costly. It is requested that the existing 0.75 full time equivalent (FTE) Natural Resource Specialist be increased to a 1.00 FTE within the Integrated Pest Management group at a cost of $25,113. Under the new “Affordable Health Care Act” regulations that take effect in 2014, it is estimated that OSMP will employ seven to 15 seasonal employees who meet the minimum requirements for employer-matched health benefits. It is estimated that OSMP’s share of this cost is $100,000. The city has not decided how to approach this new requirement and these funds are included as a place holder for when the costs are determined. Changes in Staffing Levels For 2014, staff is recommending a total of 94.35 FTEs. This includes continuation of 88.5 standard on-going FTEs, two existing standard fixed-term FTEs, the additional 3.75 standard fixed term FTEs described above and 0.1 FTE of a Conservation Coordinator position funded in the City Manager’s Office. Staff will continue to utilize available funding for seasonal and temporary workers in order to address other service needs across the department. AGENDA ITEM 5 PAGE 7 General Fund Transfer For 2014, the General Fund transfer for Mountain Parks is modeled at $1,103,480, up from the $1,072,174 approved for 2013. As a point of reference, the transfer was $1,241,722 in 2001, and was reduced to a low of $921,381 in 2010. Review of the Open Space Board Contingency Reserve Policy Approximately 92 percent of the OS Fund revenue is generated by sales tax and the program is limited in its ability to raise additional revenue from other tax levies or fees. Because of this situation, the OSBT has recommended that a substantial contingency reserve be maintained. Each year the OSBT, during the budget process, reviews the reserve amount taking into consideration national, regional and local economic conditions, debt service needs, proposed purchases, the program’s projected management costs and projected sales tax revenue growth rates. Each year the actual level of debt service may vary due to payoff of old notes and bonds and issuance of new notes and bonds. Total debt service in 2014 is projected to be $6,722,082. The staff recommends a contingency reserve in the amount of $6,435,000 for 2014. This includes $3,500,000 contingency and open space revenue bond reserves, $45,000 for the 27th pay period reserve, a $490,000 reserve to fulfill TABOR requirements for accrued benefits and a $400,000 reserve for potential property and casualty liability. Additionally, staff will continue funding a reserve for the South Boulder Creek Instream Flow project ($1,750,000) and institute new reserves for vehicle acquisition ($150,000) and facility repair and replacement ($100,000). Cost Allocation Cost allocation for OSMP in 2014 is $1,108,400. This is an increase of 3.9 percent from the $1,066,954 for 2013. The cost allocation model is intended to reflect the department’s utilization of services from other city departments that it does not pay for directly and is based on a rolling average of the three previous years. Capital Improvement Plan For 2014, the CIP for the Open Space Fund is recommended to include $5,400,000 for land acquisition, $200,000 for water rights acquisition, $100,000 for mineral rights acquisition and $1,310,000 for visitor infrastructure (Attachment B). Additionally, the department recommends appropriation of its share of the Lottery Fund in the amount of $343,000 in 2013 (Attachment C). Land acquisition capital has, in accordance with the approved update to the Real Estate Acquisition Plan, been increased by $2,000,000 from previous years; water and mineral rights capital remain constant. Within the Real Estate Acquisition program, properties acquired since 2000, including lands in Jefferson County, have been purchased under the guidance of the Accelerated Acquisition Program and the Acquisition and Management Plan 2000 - 2006 as it has been extended through 2011. Staff anticipates acquiring an additional 8,731 acres under the Acquisitions Update 2013- 2019 subject to availability of funds. AGENDA ITEM 5 PAGE 8 Under this plan, additional open space will be acquired within the following acquisition areas: Boulder Valley Comprehensive Planning Area, Mountain Parks, Table Mountain and Jefferson County Partnerships, as approved by the OSBT and City Council. The Water Rights Acquisition program provides funding to purchase additional water rights from private owners or others for use on Open Space for agricultural and environmental purposes, as water becomes available in the Coal Creek, South Boulder, Boulder and Lefthand Creek watersheds. Funds will also be used for professional, legal and engineering fees, related analysis and other costs as may be necessary to manage and protect the water rights portfolio. OSMP staff will continue to work with other city departments to assist in enhancing instream flow where possible. The Minerals Rights Acquisition program provides funding to purchase underlying mineral interests from private owners, as they become available on the real estate market. Many of these interests in minerals, gas, oil and aggregates were severed from the properties before purchase by the city and could cause future management issues. Funds are also used for research, mapping and analysis of potential acquisitions. The Visitor Infrastructure program provides funding for capital maintenance of existing trails and trailheads; construction of new trails and trailheads and other facilities that improve the visitor experience, such as safe road crossings; and to restore areas where visitor impacts are high. For 2014, it is recommended that the Visitor Infrastructure CIP be allocated $1,310,000. This allocation will fund expenditures in the West TSA at the level of $710,000 and includes funding for the following large (>$50,000) projects: Reroute Flagstaff Trail ($120,000); reroute Green Mountain West Ridge ($60,000); reroute Saddle Rock Trail ($65,000); and reroute Ute and Range View Trails ($65,000). Projects in the balance of the system are funded at a total of $500,000. In addition, $100,000 is recommended to continue improvements to South Boulder Creek in anticipation of the expansion of Gross Reservoir. Lottery Fund Allocation The Historic Structures and Trails Stabilization and Restoration program within the mountain backdrop uses lottery funds to identify, analyze, stabilize and rehabilitate significant historic structures and trails and protect other sites and artifacts identified in cultural resource inventories. These funds will be utilized to supplement the Visitor Infrastructure CIP to implement the West TSA Plan. OSMP’s appropriation from the Lottery Fund continues at the 2013 level of $343,000 in 2014. It is expected that funding will be $355,300 per year from 2015 through 2019. Lottery Fund revenues are evaluated and projected each year and appropriations are adjusted based on an analysis of revenues and maintaining sufficient reserves in order to offset any short-term funding shortfall. Relationship of CIP to Operating Budget The Open Space and Mountain Parks Visitor Master Plan was adopted in April 2005 and outlines a significant capital expenditure plan in order to address identified needs within the six-year CIP schedule. This, together with the Open Space Long-Range Management Policies adopted in 1995, sets the management direction for the OSMP Department. These policy level plans, along AGENDA ITEM 5 PAGE 10 This page intentionally left blank. CITY OF BOULDER 2012-2019 PROPOSED BUDGET OPEN SPACE and MOUNTAIN PARKS FUND ATTACHMENT A AGENDA ITEM 5 PAGE 11 2012 2013 2014 2015 2016 2017 2018 2019 Actual Revised Projected Projected Projected Projected Projected Projected Beginning Fund Balance 13,219,306$ 18,917,725$ 13,034,089$ 13,838,368$ 17,065,052$ 18,952,565$ 24,041,878$ 29,761,845$ Sources of Funds Net Sales Tax Revenue 24,843,163$ 25,406,420$ 26,295,672$ 27,176,894$ 28,088,010$ 29,000,132$ 29,928,588$ 30,887,634$ Investment Income 324,723 325,000 325,000 325,000 325,000 325,000 325,000 325,000 Lease and Miscellaneous Revenue 733,655 485,909 485,909 485,909 485,909 325,000 325,000 325,000 Sale of Property 893,731 - - - - - - - Funds from CDOT for Granite acquisition 1,300,000 General Fund Transfer 1025753 1,072,174 1,103,480 1,114,515 1,125,660 1,136,917 1,148,286 1,159,769 Grants 222,983 25,500 - - - - - - Total Sources of Funds 28,044,008$ 28,615,003$ 28,210,061$ 29,102,318$ 30,024,579$ 30,787,049$ 31,726,874$ 32,697,403$ Uses of Funds General Operating Expenditures 10,061,560$ 11,930,231$ 11,785,916$ 12,959,859$ 13,228,951$ 13,625,820$ 14,034,594$ 14,455,632$ Increase to 2013 base $779,384 Operating Supplemental and Carryover 260,087 Voice & Sight Tag Program Enhancements 94,000 Vehicle Acqusition - - - - 300,000 - - - Administrative Transfer 1,070,853 1,066,954 1,108,400 1,163,820 1,222,011 1,283,112 1,347,267 1,414,630 Capital-Real Estate Acquisition CIP 1,599,195 3,400,000 5,400,000 5,400,000 5,400,000 5,400,000 5,400,000 5,400,000 Capital-Real Estate Acquisition Carryover 5,571,422 - - - - - Capital-Water Rights Acquisition CIP 21,761 200,000 200,000 200,000 200,000 200,000 200,000 200,000 Capital-Water Acquisition Carryover - 187,817 - - - - - - Capital-South Boulder Creek Instream Flow - 100,000 100,000 150,000 2,000,000 - - - Capital-So Bldr Crk Instream Flow Carryover - 50,000 - - - - - - Capital-North TSA - 50,000 50,000 50,000 100,000 200,000 100,000 50,000 Capital-Reroute Flagstaff Trail - - 120,000 - - - - - Capital-Reroute Green Mtn. West Ridge - - 60,000 - - - - - Capital-Reroute Saddle Rock Trail - - 65,000 - - - - - Capital- Reroute Ute and Range View Trails - - 65,000 - - - - - Capital-West TSA 169,486 450,000 500,000 550,000 550,000 450,000 600,000 50,000 Capital-East TSA - - - - - 50,000 50,000 200,000 Capital-Mineral Rights Acquisition - 100,000 100,000 100,000 100,000 100,000 100,000 100,000 Capital-Mineral Acquisition Carryover - 261,184 - - - - - - Capital-Visitor Infrastructure CIP 826,114 400,000 350,000 300,000 250,000 200,000 200,000 500,000 Capital-VI CIP Carryover - 803,712 - - - - - - Capital-Highway 93 Underpass - 1,000,000 - - - - - - Debt Service - BMPA 1,734,407 1,597,457 1,500,969 1,110,243 996,341 395,842 169,282 69,366 Debt Service - Bonds & Notes 6,862,213 7,069,775 5,221,113 3,797,712 3,789,762 3,792,962 3,805,763 2,025,231 Total Uses of Funds 22,345,589$ 34,498,639$ 27,405,782$ 25,875,635$ 28,137,066$ 25,697,736$ 26,006,907$ 24,464,860$ Ending Fund Balance Before Reserves 18,917,725$ 13,034,089$ 13,838,368$ 17,065,052$ 18,952,565$ 24,041,878$ 29,761,845$ 37,994,388$ Reserves OSBT Contingency Reserve 5,475,000$ 5,475,000$ 3,500,000$ 2,500,000$ 2,400,000$ 2,000,000$ 2,000,000$ 1,100,000$ Pay Period 27 Reserve 287,270 - 45,000 95,000 145,000 195,000 - - Sick/Vacation/Bonus Reserve 490,000 490,000 490,000 490,000 490,000 490,000 490,000 490,000 Property and Casualty Reserve 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 South Boulder Creek Flow Reserve 1,150,000 1,450,000 1,750,000 2,000,000 - - - - Vehicle Acquisition Reserve - - 150,000 300,000 Facility Maintenance Reserve - - 100,000 200,000 300,000 400,000 500,000 600,000 Total Reserves 7,802,270$ 7,815,000$ 6,435,000$ 5,985,000$ 3,735,000$ 3,485,000$ 3,390,000$ 2,590,000$ Ending Fund Balance After Reserves 11,115,455$ 5,219,089$ 7,403,368$ 11,080,052$ 15,217,565$ 20,556,878$ 26,371,845$ 35,404,388$ OPEN SPACE AND MOUNTAIN PARKS This page is intentionally left blank.