The Elephant in the Room
March 6, 2019
Thank you for your comments and positive feedback on my previous council corner “The Housing Dilemma” published on January 30, 2019. I appreciate your input on this complex topic and for joining me in my learning and fact gathering journey.
Continuing this journey, let’s talk about the Elephant in the Room – Our aging infrastructure, our funding challenges, and the need to discuss, figure out solutions, prioritize and make difficult decisions to address them.
Foster City is fiscally strong. Our mission states that “We are committed to ensuring the long-term financial stability of the City and providing services that enhance the quality of life for those who live, work, and play in Foster City.” The fiscal stewardship exercised by the City Council and City staff is manifested through developing prudent and effective long-term financial strategies and making appropriate financial decisions. For the current fiscal year, a combination of property, sales, transient occupancy (TOT), and business license taxes make up the majority of the City’s $43.5 million dollar General Fund Budget.
However, our City is turning 50 in 2021. The City's infrastructure, which was built more than 40 years ago, now requires minor renovations or major upgrades to operate efficiently and safely. In addition, a reduction of new development projects over the next 5-years diminishes one-time building and permit revenues to pay for infrastructure maintenance or replacements. We are at a point where prudent planning, existing revenue sources, and focus on economic development is not enough to address these issues. As a community, we must acknowledge this harsh reality and begin the conversation and dialogue on how to tackle these challenges.
Foster City enjoys more than 100 acres of park and open space land including bike paths, dog exercise areas, a lighted softball field, numerous soccer and youth baseball fields, tennis courts, basketball courts, bocce ball courts, picnic facilities, par courses, and a wildlife refuge. The City’s system of 24 parks, 8 miles of levee pedway, a recreation center, library, Council Chambers, youth center, and other public facilities are showing signs of age. Funding is needed to preserve and rehabilitate existing infrastructure as it ages.
As a financial planning strategy, the City has built up reserves in its General Fund and Capital Improvement Fund to provide the necessary financial resources to maintain infrastructure. As an additional planning tool, the City initiated a parks system master plan study to help identify future maintenance, sustainability, and water conservation opportunities. Parks staff estimates that over the next 15-years, total Parks capital improvements will require a significant fiscal investment.
We have been talking about the Recreation Center issues for a while, but there are other buildings that need our attention as well.
The Public Works Corporation Yard Buildings are some of the oldest buildings in Foster City and need attention. The roof of the Parks Workshop Buildings is over 20 years old, and while maintenance and repairs have been conducted as needed, the roof is now due for replacement.
The Police Station roof was installed when the building underwent its major remodel in 2000 as part of the Government Center Project. Since that time, the Building Maintenance Division has performed on-going maintenance and repairs to address on-going leaks in the lineup room, kitchen, and lobby areas. This roof is scheduled and due for replacement.
The Council Chambers roof was installed when the building was constructed in 2001. Now this facility is due for maintenance.
Funding is also needed to maintain and improve existing infrastructure, like our roadways, sidewalks, water, wastewater, lagoon and levee facilities, to meet federal and state legal requirements put in place after the infrastructure was constructed. These requirements include environmental regulations, the Americans with Disabilities Act, and Climate Change.
In March 2018, the City Council directed staff to plan for a Transient Occupancy Tax (TOT) revenue measure (increasing the current rate from 9.5% to 11% effective January 1, 2019 and then to 12% effective July 1, 2019) in November 2018 to help address the City’s projected structural deficits. The five-year financial plan assumes the passage of this revenue measure with estimated additional annual TOT revenues.
Over the past few years, the City has taken an active role in using economic development activities to generate revenue for City needs. One such program, the Commercial Facade Improvement Matching Grant Program, assists neighborhood shopping center property-owners in upgrading their centers to help nurture a positive retail business environment and stimulate economic development. As a result of the upgrades, the upgraded property carries a higher property value, and potentially attract more customers to the center.
In closing, I think that the first step to plan and address any challenge is to have the courage to acknowledge it and begin the dialogue with an open mind. In order to ensure we continue to enjoy the same level of service and the quality of life, we must continue to find additional, diversified revenue sources and preserve the existing ones and intensify our economic development efforts. The challenge lies in achieving that without impacting our quality of life and maintaining the character of our beautiful and unique city. Broadly speaking, I foresee that balancing these two key aspects - additional revenue and maintaining our quality of life will be driving my decisions.
The residents should be aware, remain informed about these realities, and be more engaged as we tackle these difficult decisions in the not too distant future. Please continue to reach out to me at rawasthi@fostercity.org with concerns, questions, and ideas.
