Time Set # 27.
Board of Supervisors
- Meeting Date:
- 02/21/2023
- Brief Title
- South Davis Branch Library
From:
Diana Lopez, County Librarian, County Library
Staff Contact:
Melinda Cervantes, County Library, x8083
Supervisorial District Impact:
Districts 2 and 4
Subject
Receive update on the New South Davis Branch Library project and grant, consider acceptance of California State Library Building Forward grant in the amount of $8,783,400, and provide direction and consider approval of related actions to further the project. (Future significant general fund impact possible) (Pinedo/Lopez/Cervantes)
Recommended Action
Receive an update on the California State Library grant including amount received, matching requirements, period of availability, unallowable costs, and other key terms and conditions; and receive an update providing an overview of the New South Davis Branch Library project including project construction and operational costs, construction timeframe, available funding sources, project risks, and project off-ramps; and
- Adopt resolution (Attachment Q) granting the Yolo County Administrator and/or designee authority to accept, on behalf of Yolo County, $8,783,400 from the California State Library to partially fund the construction of the New South Davis Branch Library; and
- Authorize the County Administrator or designee to execute the final Building Forward Grant Agreement for the new South Davis Library, including amendments or extensions, subject to County Counsel approval as to form.
- Approve the Chief Financial Officer's certification of availability of matching funds (Attachment G);
- Provide direction on construction and operation funding scenarios provided by staff and preferred funding sources; and
- Direct staff to negotiate a revived agreement with the City of Davis as to their contribution of the Walnut Park site.
Strategic Plan Goal(s)
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Thriving Residents |
Reason for Recommended Action/Background
Project History and Timeline
The Board of Supervisors last had an update on the New South Davis Branch Library project at the July 12, 2022, Board meeting (Attachment A) and requested staff to return with an update in approximately six months after the status of the grant application with the California State Library was known.
To briefly recap, pre-pandemic data showed that the services, resources, and programs offered at the Mary L. Stephens Davis Branch Library, situated in North Davis, were at capacity. Data from 2018 showed high usage of the library with frequent use of meeting rooms and parking spaces. Ultimately, this data coincides with the experience of staff that often find individuals crowding at tables or sitting on the floor. The 2014 Strategic Space Utilization Study also found that the Mary L. Stephens Davis Branch Library has reached maximum capacity in terms of space.
In line with this and consistent with a long-term community vision, constructing a new library in South Davis is the predominant strategy to reduce library facility capacity issues, expand services to a growing Davis community, and provide access for those who have difficulty traveling to the Mary L. Stephens library in North Davis. This opportunity is unique and benefits the entire community as it can both mitigate the overflow and potentially serve new community members who previously faced geographic barriers to library access as well as expand the overall collection of the County library system.
The Library included this facility in its 2017 facilities master plan (Attachment B), which targeted a 2025 date for this facility. That plan also contains facility needs for another facility in West Sacramento in 2030, and possible expansions of facilities in Winters and Esparto in 2035.
The South Davis Library Ad Hoc Committee met periodically from 2019 to present and explored service priorities, reviewed use and demographic data, explored financing options, hours of operation, and staffing models for a South Davis Branch Library. Yolo County engaged WMB Architects to develop a conceptual design for the facility. This development process included meetings with various community non-profits and stakeholders to incorporate interests and community needs in the design of the facility. The conceptual design was delivered in April 2021.
Yolo County applied for $8,783,400 in grant funding from the California State Library's Building Forward Library Infrastructure Grant program in February 2022. The tentative award was announced in October 2022 for the full amount requested contingent on a Board resolution authorizing acceptance of the funds.
Staff have delayed coming back to the Board for acceptance of the grant funds to prepare information to provide a clear picture on the current state of the New South Davis Branch Library Project ("Project") to allow the Board to consider all aspects of the Project before taking action.
Land Contribution
Locating the new facility in South Davis has been preferred due to land previously made available by the City of Davis in Walnut Park and the opportunity to serve residents currently separated by the intersecting freeway from other parts of the City and community facilities. The City and County Memorandum of Understanding (MOU) related to the transfer of a portion of Walnut Park for the South Davis Branch Library site expired on October 28, 2012, and the land reverted to the City (Attachment C).
The City of Davis and the County entered into a new MOU in December 2012 (Yolo County Agreement No. 12-166), expressing the City and County's continued interest in establishing a South Davis Branch Library at the Walnut Park site. Staff requests Board approval to re-approach the City to negotiate a new land transfer agreement for a portion of Walnut Park to be used for the Project. A finalized land transfer agreement will need full Board approval at a future meeting.
Grant Terms and Conditions
The County of Yolo received a tentative award in October 2022 for an $8,783,400 grant toward the construction of a New South Davis Branch Library facility. A copy of the grant application (Attachment D) and draft grant agreement (Attachment E) are attached. The grant application was submitted with support from the South Davis Library Ad Hoc Committee and shared with the Board in Friday updates as well as a full Board update at the July 2022 Board meeting. County staff followed the County policy on Grant Administration and obtained approval from the Grant Oversight Committee, a multi-department grant oversight body, prior to applying for the grant. Board approval was not obtained prior to submission. Per County policy this is only required when needed by the grantor, otherwise the Board considers and approves the grant acceptance and agreement post-award.
The initial grant submission was based on the conceptual design (Attachment F) prepared in April 2021 by WMB Architects, which was for 16,500 square feet of building space. Cost projections provided by WMB at that time indicated facility cost estimates of between $14 million to $18 million. Based on work with the Ad-Hoc committee a decision was made to apply for $8,783,400 of funds as that was the amount of estimated matching funds available, while the California State Library cap for each facility request was $10 million.
As part of the grant award, the County will have until March 31, 2026, to complete construction of the Project. The March 31, 2026, deadline for expenditure of funds is set in the state budget and not subject to change unless the State Library obtains approval from the Department of Finance or the Legislature. This presents a specific risk that should the County begin the project and not complete it by the deadline, the County would be liable for costs incurred after March 31, 2026. The County can choose according to the grant agreement to withdraw the project if it cannot be completed in the scope of the original application. The Project may be withdrawn prior to completing 50% of the project and any unspent funds would need to be returned.
The grant requires a dollar-for-dollar match and thus the County is required to come up with a local match in the amount of $8,783,400. A letter from the Chief Financial Officer on the availability of match funding is required as part of grant acceptance (Attachment G) and included in the Board packet. As part of the grant application, the County pledged $3.1 million of Library Development Impact Fees (DIF) as a matching source to the project as well as $5,683,400 of Mello Roos Special Library Taxes generated that is specific to Davis and surrounding areas. This special tax was last approved in 2007 through Measure P and this and the Library DIF are further described under Available Funding Sources below.
After submitting the grant application, the State clarified and added a significant number of unallowable costs that the grant is not able to cover related to the Project construction (Attachment H). The main categories that this affects in the County's construction budget are site work (associated with parking lots, pathways, lighting, electric chargers), furniture, fixtures and equipment, the library collection, and local public art requirements. Costs that are deemed unallowable for the grant will need to be solely paid for with local or other non-grant funds. The County Librarian has engaged the Office of the State Librarian to see if they would consider revisiting the list of unallowable costs as it impacts the project.
New South Davis Branch Library Project
Facility
County staff after receiving notification of the grant award in October 2022 asked WMB architects to update the costs for the facility conceptual design provided. The updated cost provided was approximately $24 million in 2022 dollars. Staff then met with the South Davis Library Ad Hoc Committee to obtain guidance on November 1, 2022. Based on discussion as to the project gaps at that time, it was determined that staff should consider scaling back the facility as well as schedule a 2x2x2 with the Ad Hoc Committee and the City and School District to update them on the project and request any assistance that they might be able to provide. This meeting was held on January 18, 2023.
Based on discussion with WMB architects, staff reduced the Project size to 12,000 square feet mainly by removing lobby space, unnecessary hallways, and reducing the number of study rooms. A copy of that floor plan is attached (Attachment I). This reduced the estimated Project cost down to $17.9 million in 2022 dollars. However, as described below under Construction Budget and Options, the County should expect construction costs to continue to escalate before construction.
Construction Available Funding Sources
The Board of Supervisors last had an update on the New South Davis Branch Library project at the July 12, 2022, Board meeting (Attachment A) and requested staff to return with an update in approximately six months after the status of the grant application with the California State Library was known.
To briefly recap, pre-pandemic data showed that the services, resources, and programs offered at the Mary L. Stephens Davis Branch Library, situated in North Davis, were at capacity. Data from 2018 showed high usage of the library with frequent use of meeting rooms and parking spaces. Ultimately, this data coincides with the experience of staff that often find individuals crowding at tables or sitting on the floor. The 2014 Strategic Space Utilization Study also found that the Mary L. Stephens Davis Branch Library has reached maximum capacity in terms of space.
In line with this and consistent with a long-term community vision, constructing a new library in South Davis is the predominant strategy to reduce library facility capacity issues, expand services to a growing Davis community, and provide access for those who have difficulty traveling to the Mary L. Stephens library in North Davis. This opportunity is unique and benefits the entire community as it can both mitigate the overflow and potentially serve new community members who previously faced geographic barriers to library access as well as expand the overall collection of the County library system.
The Library included this facility in its 2017 facilities master plan (Attachment B), which targeted a 2025 date for this facility. That plan also contains facility needs for another facility in West Sacramento in 2030, and possible expansions of facilities in Winters and Esparto in 2035.
The South Davis Library Ad Hoc Committee met periodically from 2019 to present and explored service priorities, reviewed use and demographic data, explored financing options, hours of operation, and staffing models for a South Davis Branch Library. Yolo County engaged WMB Architects to develop a conceptual design for the facility. This development process included meetings with various community non-profits and stakeholders to incorporate interests and community needs in the design of the facility. The conceptual design was delivered in April 2021.
Yolo County applied for $8,783,400 in grant funding from the California State Library's Building Forward Library Infrastructure Grant program in February 2022. The tentative award was announced in October 2022 for the full amount requested contingent on a Board resolution authorizing acceptance of the funds.
Staff have delayed coming back to the Board for acceptance of the grant funds to prepare information to provide a clear picture on the current state of the New South Davis Branch Library Project ("Project") to allow the Board to consider all aspects of the Project before taking action.
Land Contribution
Locating the new facility in South Davis has been preferred due to land previously made available by the City of Davis in Walnut Park and the opportunity to serve residents currently separated by the intersecting freeway from other parts of the City and community facilities. The City and County Memorandum of Understanding (MOU) related to the transfer of a portion of Walnut Park for the South Davis Branch Library site expired on October 28, 2012, and the land reverted to the City (Attachment C).
The City of Davis and the County entered into a new MOU in December 2012 (Yolo County Agreement No. 12-166), expressing the City and County's continued interest in establishing a South Davis Branch Library at the Walnut Park site. Staff requests Board approval to re-approach the City to negotiate a new land transfer agreement for a portion of Walnut Park to be used for the Project. A finalized land transfer agreement will need full Board approval at a future meeting.
Grant Terms and Conditions
The County of Yolo received a tentative award in October 2022 for an $8,783,400 grant toward the construction of a New South Davis Branch Library facility. A copy of the grant application (Attachment D) and draft grant agreement (Attachment E) are attached. The grant application was submitted with support from the South Davis Library Ad Hoc Committee and shared with the Board in Friday updates as well as a full Board update at the July 2022 Board meeting. County staff followed the County policy on Grant Administration and obtained approval from the Grant Oversight Committee, a multi-department grant oversight body, prior to applying for the grant. Board approval was not obtained prior to submission. Per County policy this is only required when needed by the grantor, otherwise the Board considers and approves the grant acceptance and agreement post-award.
The initial grant submission was based on the conceptual design (Attachment F) prepared in April 2021 by WMB Architects, which was for 16,500 square feet of building space. Cost projections provided by WMB at that time indicated facility cost estimates of between $14 million to $18 million. Based on work with the Ad-Hoc committee a decision was made to apply for $8,783,400 of funds as that was the amount of estimated matching funds available, while the California State Library cap for each facility request was $10 million.
As part of the grant award, the County will have until March 31, 2026, to complete construction of the Project. The March 31, 2026, deadline for expenditure of funds is set in the state budget and not subject to change unless the State Library obtains approval from the Department of Finance or the Legislature. This presents a specific risk that should the County begin the project and not complete it by the deadline, the County would be liable for costs incurred after March 31, 2026. The County can choose according to the grant agreement to withdraw the project if it cannot be completed in the scope of the original application. The Project may be withdrawn prior to completing 50% of the project and any unspent funds would need to be returned.
The grant requires a dollar-for-dollar match and thus the County is required to come up with a local match in the amount of $8,783,400. A letter from the Chief Financial Officer on the availability of match funding is required as part of grant acceptance (Attachment G) and included in the Board packet. As part of the grant application, the County pledged $3.1 million of Library Development Impact Fees (DIF) as a matching source to the project as well as $5,683,400 of Mello Roos Special Library Taxes generated that is specific to Davis and surrounding areas. This special tax was last approved in 2007 through Measure P and this and the Library DIF are further described under Available Funding Sources below.
After submitting the grant application, the State clarified and added a significant number of unallowable costs that the grant is not able to cover related to the Project construction (Attachment H). The main categories that this affects in the County's construction budget are site work (associated with parking lots, pathways, lighting, electric chargers), furniture, fixtures and equipment, the library collection, and local public art requirements. Costs that are deemed unallowable for the grant will need to be solely paid for with local or other non-grant funds. The County Librarian has engaged the Office of the State Librarian to see if they would consider revisiting the list of unallowable costs as it impacts the project.
New South Davis Branch Library Project
Facility
County staff after receiving notification of the grant award in October 2022 asked WMB architects to update the costs for the facility conceptual design provided. The updated cost provided was approximately $24 million in 2022 dollars. Staff then met with the South Davis Library Ad Hoc Committee to obtain guidance on November 1, 2022. Based on discussion as to the project gaps at that time, it was determined that staff should consider scaling back the facility as well as schedule a 2x2x2 with the Ad Hoc Committee and the City and School District to update them on the project and request any assistance that they might be able to provide. This meeting was held on January 18, 2023.
Based on discussion with WMB architects, staff reduced the Project size to 12,000 square feet mainly by removing lobby space, unnecessary hallways, and reducing the number of study rooms. A copy of that floor plan is attached (Attachment I). This reduced the estimated Project cost down to $17.9 million in 2022 dollars. However, as described below under Construction Budget and Options, the County should expect construction costs to continue to escalate before construction.
Construction Available Funding Sources
- California State Library Grant -- The California State Library received a total of $489 million in one-time funds for the Building Forward Library Infrastructure Grant program. The County applied for the program to fund an equity capital project to build the Project. The State Library looked to fund critical maintenance needs, energy improvements and sustainability, projects that expanded physical or digital access and prioritized high poverty areas of the State. The County funds awarded in the amount of $8,783,400 are subject to the grant terms and conditions described above and in Attachment E.
In addition to the State Library Grant award, County staff have identified several funding sources as options to meet the local matching requirement as well as to cover any unallowable Project costs:
- Developer Contribution -- The County pursued the possibility of a funding amount of $2 million from the Davis Sustainability and Innovation Campus project as well as a small amount of ongoing library revenues. Unfortunately, the ballot measure was not approved by the Davis voters in June 2022 and a developer contribution is not available at this time.
- Library Development Impact Fees -- The County has adopted a development impact fee specific to library needs due to new development and population growth associated with that development. The last development impact fee study was updated in 2015 and is expected to be updated again in early 2023. The fees are collected countywide, except for Woodland, which provides its own Library services within City boundaries. Development Impact Fees are intended for use for new or expanded facilities that are needed due to the impacts of new development. A copy of the current Development Impact Fee study is attached (Attachment J). When considering the use of development impact fees, the County should consider equity between its communities. To assess that, the County looked at what level of DIF fees are expected to be available to contribute to future projects in West Sacramento, Winters and Esparto based on the Library Facilities plan. A copy of that analysis is included in Attachment K that shows similar amounts are expected to be available for those projects in 2030 and 2035 should all the currently available DIF be used toward this Project.
- Library CFD Special Tax Revenue -- The County has a Community Facilities District (CFD) that has contiguous boundaries with the Davis Joint Unified School District (excluding the Solano County portion). This District was originally approved by voters of the District in 1989 and subsequently an amendment to the Special tax was approved in 2007 (Measure P). That assessment is specific to and may only be used for the operations, maintenance and capital needs of libraries within the boundaries of that District. The District did issue bonds in 2002 and 2008 to finance improvements at the Mary L. Stephens Davis Library, which were refunded in 2015. Those bonds are still outstanding until 2035, but assessments in excess of debt service may be used on those other operational, maintenance, and capital needs of libraries within the District. Based on review with County Counsel, the Project is an eligible use of funds from the 2007 measure; however, the ballot measure requires that operations and maintenance of the Mary L. Stephens Davis Library should be funded with the special tax proceeds before expenditures on library services or facilities in South Davis. The County has some fund balance accumulated from the Special Tax that was pledged as a match for the new South Davis Branch Library Project.
- American Rescue Plan Funds -- The County received $42.8 million of federal funding through the American Rescue Plan. These funds are intended to respond to and recover from the COVID-19 pandemic. The County has $2.5 million that was originally allocated to support the purchase of the St. John's campus. Back in September 2022, the Board determined that it no longer planned to pursue that acquisition and the Board has not yet instructed staff how they wish to re-allocate the funds. As a result, that $2.5 million in ARP funds are available for reallocation to this Project or other uses. General government facilities do not meet the core requirements of responding to or recovering from the pandemic; however, the ARP legislation allowed flexibility to use revenue recovery provisions to meet governmental needs and expenditure of such revenue recovery proceeds would be an eligible expense of the funds.
- Accumulated Capital Outlay Funds (ACO) -- The Board of Supervisors approved levy of a property tax back in the 1960s pursuant to Government Code 53731 et seq., which allowed the County to collect a tax specifically for capital outlay expenditures. The County appropriates this source during the County's budget process, but an accumulated balance exists that can contribute to emerging projects in the Capital Improvement Plan. Once the fund balance is exhausted, the County will continue to receive and be reliant on annual receipts through the property tax process to meet much of the existing County-wide capital needs.
- General Fund Capital Improvement Reserve (CIP) -- The County each year as part of the budgetary process determines funding available to set aside for future capital needs. These funds are reserves by the Board to meet needs as they arise and are not earmarked or specifically allocated for any one project. During the adopted budget approved in September 2022, the County allocated $4.4 million. During this fiscal year, $900,000 was appropriated for the Knights Landing Park project leaving approximately $3.5 million remaining. The Capital Improvement reserve does not have a specific funding target but is a critical tool to meeting large capital needs without the need for taking on debt. This fund does not receive contributions each year as it only occurs when budget capacity allows for it.
- City of Davis contribution -- The City of Davis City Council discussed the South Davis Library at its February 7, 2023 board meeting. As part of that discussion, the Council noted their support for the South Davis Library project and pledged funding support of between $1.0 to $1.5 million. This was pledged with direction to their City staff to determine funding options and bring back for approval as part of the City’s May 2023 budget hearing. The two possible funding sources that were discussed by the City were American Rescue Plan funds that the City set aside for Climate Resilience as well as City park development impact fees. It should be noted that the City had significant discussion about the ability of the new Library facility to serve as a climate resiliency center and should the Board move forward with the grant, City and County staff will need to ensure that the current facility design will meet the needs of this type of facility. A copy of the City staff report and presentation from February 7, 2023 are included as Attachment R and S, respectively.
Construction Budget and Options
The project costs from WMB represent $17.9 million in 2022 dollars. That figure is inclusive of a 10% contingency for Project construction. However, given that construction isn't expected to start until mid to late 2024 and not be completed until early 2026, it is a best practice to escalate construction dollars out to the mid-point of construction. As a result, staff have escalated costs out to 2025 dollars which results in three years of additional escalation. Construction costs have grown more rapidly than general inflation during calendar years 2021 and 2022. While staff expect inflation to begin to abate and come down, staff have estimated that inflation will be 8% in 2023, 6% in 2024, and 4% in 2025. These reflect conservative estimates of construction escalation specifically and do not mirror the County's expectations for general inflation over this period. After inflation, this results in an escalated 2025 cost for planning purposes of $21.3 million for the Project.
Of this Project cost and based on current estimates, $17.2 million of project costs are grant eligible while $4.1 million of the costs are ineligible. This results in the County almost maximizing the entire grant using $8.6 million of the $8.8 million grant. Under these estimates, the County must come up with local funds of an $8.6 million match and $4.1 million of funds for unallowable costs for a total local need of $12.7 million to complete the Project.
Staff prepared a summary of project costs as well as a summary of identified funding sources (Attachment L) for the Board's discussion of ways to meet the Project costs that are beyond the grant and grant match. This assumes that the Project remains at the reduced size of 12,000 sq. feet. Further changes in Project size could change the costs, but there would still be items that are unallowable costs for the grant that would need to be covered by non-grant funds.
Staff do not have a specific proposal at this time to close the project funding gaps but have identified several methods to close the capital funding gap and are optimistic in the ability to close this prior to start of construction (mid 2024). Staff plan to continue to explore funding contributions from the City and School District, review any additional grant opportunities, explore community fundraising and then look to County funding sources mentioned above to close the remaining capital gap. Staff expect to come back to the Board with a specific funding plan for approval in the future and would like to get board feedback on funding sources and strategy to inform that plan development.
Construction Timeline
General Services staff worked with WMB Architects to prepare a proposed construction timeline to determine if the project may be able to be completed in the timeframe required by the grant (by March 31, 2026). Attached is a proposed project timeline that shows the major phases (Attachment M). It should be noted that given that there are only 38 months left in the grant timeline and given that the construction period may be as much as 18 months, that leaves little room or margin for delays given that design and environmental documents still need to be completed. Staff will work closely between General Services and Library to minimize design changes or other decisions that would delay completion of Project design.
Operational Costs
County staff have performed assessments of operational costs for a new South Davis Branch Library. Based on projections prepared by the County Library and the Department of Financial Services, it would cost an estimated $1.1 million in funding to operate the Project starting in 2026. A list of the projected costs involved in operating the Library Branch is included in Attachment N. The Library currently does not have an excess in its General Fund budget to contribute to operate the facility and has a limited amount of project unutilized Library CFD Special Taxes from the existing assessment, which is expected to contribute approximately $170,000 annually to operate the Project. This leaves a projected operational gap at opening the new library of just under $1 million. A projection showing the additional funding needs going out to 2060 is included in Attachment O. While the State Library has currently indicated a requirement for the County to only operate the new facility for 10 years, it is typical to operate a new building for a period no less than 40 years.
Based on the significant size of the operational gap, staff have developed several options over the years, some of which are more palatable than others.
The project costs from WMB represent $17.9 million in 2022 dollars. That figure is inclusive of a 10% contingency for Project construction. However, given that construction isn't expected to start until mid to late 2024 and not be completed until early 2026, it is a best practice to escalate construction dollars out to the mid-point of construction. As a result, staff have escalated costs out to 2025 dollars which results in three years of additional escalation. Construction costs have grown more rapidly than general inflation during calendar years 2021 and 2022. While staff expect inflation to begin to abate and come down, staff have estimated that inflation will be 8% in 2023, 6% in 2024, and 4% in 2025. These reflect conservative estimates of construction escalation specifically and do not mirror the County's expectations for general inflation over this period. After inflation, this results in an escalated 2025 cost for planning purposes of $21.3 million for the Project.
Of this Project cost and based on current estimates, $17.2 million of project costs are grant eligible while $4.1 million of the costs are ineligible. This results in the County almost maximizing the entire grant using $8.6 million of the $8.8 million grant. Under these estimates, the County must come up with local funds of an $8.6 million match and $4.1 million of funds for unallowable costs for a total local need of $12.7 million to complete the Project.
Staff prepared a summary of project costs as well as a summary of identified funding sources (Attachment L) for the Board's discussion of ways to meet the Project costs that are beyond the grant and grant match. This assumes that the Project remains at the reduced size of 12,000 sq. feet. Further changes in Project size could change the costs, but there would still be items that are unallowable costs for the grant that would need to be covered by non-grant funds.
Staff do not have a specific proposal at this time to close the project funding gaps but have identified several methods to close the capital funding gap and are optimistic in the ability to close this prior to start of construction (mid 2024). Staff plan to continue to explore funding contributions from the City and School District, review any additional grant opportunities, explore community fundraising and then look to County funding sources mentioned above to close the remaining capital gap. Staff expect to come back to the Board with a specific funding plan for approval in the future and would like to get board feedback on funding sources and strategy to inform that plan development.
Construction Timeline
General Services staff worked with WMB Architects to prepare a proposed construction timeline to determine if the project may be able to be completed in the timeframe required by the grant (by March 31, 2026). Attached is a proposed project timeline that shows the major phases (Attachment M). It should be noted that given that there are only 38 months left in the grant timeline and given that the construction period may be as much as 18 months, that leaves little room or margin for delays given that design and environmental documents still need to be completed. Staff will work closely between General Services and Library to minimize design changes or other decisions that would delay completion of Project design.
Operational Costs
County staff have performed assessments of operational costs for a new South Davis Branch Library. Based on projections prepared by the County Library and the Department of Financial Services, it would cost an estimated $1.1 million in funding to operate the Project starting in 2026. A list of the projected costs involved in operating the Library Branch is included in Attachment N. The Library currently does not have an excess in its General Fund budget to contribute to operate the facility and has a limited amount of project unutilized Library CFD Special Taxes from the existing assessment, which is expected to contribute approximately $170,000 annually to operate the Project. This leaves a projected operational gap at opening the new library of just under $1 million. A projection showing the additional funding needs going out to 2060 is included in Attachment O. While the State Library has currently indicated a requirement for the County to only operate the new facility for 10 years, it is typical to operate a new building for a period no less than 40 years.
Based on the significant size of the operational gap, staff have developed several options over the years, some of which are more palatable than others.
- Reduce services at other libraries to staff a new South Davis Branch Library,
- Reduce County General Fund departments and programs by a corresponding amount to fund a new South Davis Branch Library,
- Obtain City of Davis and Davis Joint Unified School District commitments to provide ongoing support to the South Davis Branch Library,
- Consider a ballot measure to increase the Library Special Tax to be able to operate the facility.
Staff do not recommend the first two options. The third option has been discussed on and off with the two partner agencies. However, other than the land and the capital contribution that the City has committed to provide, no ongoing financial support has been pledged at this time by either agency. As a result, staff believe the Board should consider an increase to the Library CFD Special Tax Measure, or other revenue measures, that allow voters/community to determine whether they would support operations and maintenance of a new South Davis Branch Library.
Ballot Measure
The Board annually approves the enrollment of charges on tax bills of property owners associated with the current Library Parcel tax. The last approval of the charge was in July 2022 in the amount of $116.11 per Single Family Residence (as well as Agricultural and Commercial parcels) or $58.05 per unit for Multi-Family parcels. That tax report is included as Attachment P.
Should the Board decide to update the Special Tax Measure, it may be done at either a regular or special election (if called by the Board of Supervisors). The next regular elections would be March 2024 or November 2024 and the County staff would need to work with the Elections Office to determine deadlines for putting a measure on that election. Should a ballot measure fail to garner the needed 2/3 supermajority approval, the current Special Tax continues to be assessed to sustain existing library services.
There are currently 16,267 parcels that pay the SFR equivalent rate and 10,850 parcel tax units subject to the multi-family rate. That generates an annual assessment of $2.5 million. Hypothetically, if the Board wanted to raise an additional $1 million per year to fund a South Davis Branch Library, that would require an increase in assessment of approximately $45 to 60 for SFR and $22.50 to $30 per Multi-Family unit per year. If the Board directs, staff would perform additional analysis around a ballot measure, potential assessment amounts, and timing and return to the Board for consideration.
Recommended Actions
Staff recommend that the Board hear updates on the Project and grant, then consider approval of the grant acceptance. Staff recognize several key risks to the Project's success, primarily involving construction cost risk, construction timeline risk, operational funding risks, among others.
As a result, the actions are set up to allow the Board to obtain a robust understanding of the Project and grant before considering other actions that would further the Project. The Board could decide at this point to reject the California State Library grant and no further action would be needed. Alternatively, the staff recommendation is set up to allow for the Project to accept the grant. County staff would need to return for several actions in the future including for the Board to consider the capital and operation financing plans, approve the first initial key phase of architectural engineering and project environmental documents, as well as direct staff about the potential of a ballot measure (or other revenue generating approaches).
Ballot Measure
The Board annually approves the enrollment of charges on tax bills of property owners associated with the current Library Parcel tax. The last approval of the charge was in July 2022 in the amount of $116.11 per Single Family Residence (as well as Agricultural and Commercial parcels) or $58.05 per unit for Multi-Family parcels. That tax report is included as Attachment P.
Should the Board decide to update the Special Tax Measure, it may be done at either a regular or special election (if called by the Board of Supervisors). The next regular elections would be March 2024 or November 2024 and the County staff would need to work with the Elections Office to determine deadlines for putting a measure on that election. Should a ballot measure fail to garner the needed 2/3 supermajority approval, the current Special Tax continues to be assessed to sustain existing library services.
There are currently 16,267 parcels that pay the SFR equivalent rate and 10,850 parcel tax units subject to the multi-family rate. That generates an annual assessment of $2.5 million. Hypothetically, if the Board wanted to raise an additional $1 million per year to fund a South Davis Branch Library, that would require an increase in assessment of approximately $45 to 60 for SFR and $22.50 to $30 per Multi-Family unit per year. If the Board directs, staff would perform additional analysis around a ballot measure, potential assessment amounts, and timing and return to the Board for consideration.
Recommended Actions
Staff recommend that the Board hear updates on the Project and grant, then consider approval of the grant acceptance. Staff recognize several key risks to the Project's success, primarily involving construction cost risk, construction timeline risk, operational funding risks, among others.
As a result, the actions are set up to allow the Board to obtain a robust understanding of the Project and grant before considering other actions that would further the Project. The Board could decide at this point to reject the California State Library grant and no further action would be needed. Alternatively, the staff recommendation is set up to allow for the Project to accept the grant. County staff would need to return for several actions in the future including for the Board to consider the capital and operation financing plans, approve the first initial key phase of architectural engineering and project environmental documents, as well as direct staff about the potential of a ballot measure (or other revenue generating approaches).
Collaborations (including Board advisory groups and external partner agencies)
The County Administrator's Office collaborated with the County Library Department, Department of Financial Services, General Services, and County Counsel in preparing these recommendations. There was additional coordination with the South Davis Library Ad-Hoc Committee comprised of the District 2 and District 4 Supervisors, the City of Davis, and the Davis Joint Unified School District related to the project. The following meetings were scheduled where the project was discussed prior to the Board meeting in February 2023:
Davis 2x2 Meeting, Wednesday, January 11, 2023, at Noon
South Davis Library Ad Hoc Committee Pre-Meeting, Wednesday, February 1, 2023, at 10:00 AM
South Davis Library Ad Hoc Committee Meeting, Thursday, February 2, 2023, at 4:00 PM
South Davis Library Ad Hoc Committee Meeting, Monday, February 13, 2023, at 1:00 PM
South Davis Library 2x2x2 Meeting, Wednesday, January 18, 2023, at 6:00 PM
Davis 2x2 Meeting, Wednesday, January 11, 2023, at Noon
South Davis Library Ad Hoc Committee Pre-Meeting, Wednesday, February 1, 2023, at 10:00 AM
South Davis Library Ad Hoc Committee Meeting, Thursday, February 2, 2023, at 4:00 PM
South Davis Library Ad Hoc Committee Meeting, Monday, February 13, 2023, at 1:00 PM
South Davis Library 2x2x2 Meeting, Wednesday, January 18, 2023, at 6:00 PM
Fiscal Impact
Potential fiscal impact (see notes in explanation section below)
Fiscal Impact (Expenditure)
- Total cost of recommended action:
- $ 0
- Amount budgeted for expenditure:
- $ 0
- Additional expenditure authority needed:
- $ 0
- On-going commitment (annual cost):
- $ 0
Source of Funds for this Expenditure
- Funds
- $0
Further explanation as needed:
County staff are at this time asking the Board whether to accept the California State Library grant in the amount of $8.7 million which will also commit the Board to match expenditures dollar for dollar against the grant. Staff will need to return to the Board for budget action through a budget resolution to appropriate funds for the project. The initial budget request is expected to encompass environmental and architectural and engineer costs when staff come back to the Board either in April or May. The Board will then need to later approve a full project budget which will need to determine how to resolve the remaining unfunded gap.
Should the Board move forward, it is expected that the facility will cost approximately $1.2 million per year to operate starting in fiscal year 2026-27. The funding source for these costs is not identified and as a result, board input is sought as to how to approach this ongoing funding and whether to do that through raising revenues, reallocating funds, or some combination. Staff will need to return to the board and refine the operations and maintenance funding plan over time. Should the Board not raise new funds, this could require a future reallocation of funds from existing programs or services which could have a significant general fund impact.
Attachments
- Att. A. July 12 Board Presentation
- Att. B. 2017 Library Facilities Master Plan
- Att. C. City and County Walnut Park MOU
- Att. D. California State Library Grant Application
- Att. D(1). Grant Application Guidelines
- Att. E. Draft California State Library Grant Agreement
- Att. F. Conceptual Design (April 2021)
- Att. F(1). Conceptual Floorplan (April 2021)
- Att. G. CFO Certification of Matching Funds
- Att. H. Grant Unallowable Costs
- Att. I. Revised Floorplan (Nov. 2022)
- Att. J. Development Impact Fee Study
- Att. K. Library DIF Forecast
- Att. L. Construction Costs and Funding Sources
- Att. M. South Davis Library Timeline
- Att. N. List of Operational Costs
- Att. O. Additional Funding Need Projection
- Att. P. Library Current Parcel Tax Report
- Att. Q. Grant Acceptance Resolution
- Att. R. City of Davis February 7, 2023 Staff Report
- Att. S. City of Davis February 7, 2023 Presentation
- Att. T. Presentation - Part 1
- Att. U. Presentation - Part 2
- Att. V. Letter from Mary Stephens DeWall
- Att. W. Letter from Mariko Yamada
- Att. X. Letter from Ximena Diez-Jackson
- Att. Y. Letter from Sherrill Futrell
- Att. Z. Letter from the Galaviz Family
Form Review
| Inbox | Reviewed By | Date |
|---|---|---|
| Phil Pogledich | Phil Pogledich | 01/18/2023 01:57 PM |
| Kimberly Hood | Kimberly Hood | 01/24/2023 05:10 PM |
| Ryan Pistochini | Julie Dachtler | 02/08/2023 03:08 PM |
| Mark Bryan | Mark Bryan | 02/15/2023 10:02 AM |
| Diana Lopez | Diana Lopez | 02/15/2023 04:42 PM |
| Ryan Pistochini | Ryan Pistochini | 02/15/2023 05:38 PM |
| Financial Services | crinde | 02/15/2023 05:51 PM |
| County Counsel | Kimberly Hood | 02/16/2023 09:58 AM |
- Form Started By:
- mcervantes
- Started On:
- 12/07/2022 04:26 PM
- Final Approval Date:
- 02/16/2023