HomeMy WebLinkAbout2005-25832 Reso
RESOLUTION NO. 2005-25832
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF
THE CITY OF MIAMI BEACH, FLORIDA, AMENDING RESOLUTION
2004-25697 WHICH ESTABLISHED A CAPITAL RENEWAL AND
REPLACEMENT FUND TO PROVIDE A DEDICATED SOURCE OF
FUNDING FOR CITY CAPITAL RENEWAL AND REPLACEMENT
PROJECTS THAT EXTEND THE USEFUL LIFE OF GENERAL
FUND ASSETS; ESTABLISHED A PROCEDURE FOR ANNUAL
APPROPRIATION OF FUNDS; ESTABLISHED A PROCEDURE
FOR THEIR USE; AND ADOPTED THE FISCAL YEAR (FY) 2004/05
BUDGET FOR THE FUND, IN THE AMOUNT OF $1,347,070.
WHEREAS, the Mayor and Commission adopted Resolution 2004-24697 on
September 28, 2004 establishing a capital renewal and replacement reserve to provide a
dedicated source of funding for capital renewal and replacement projects that extend the
useful life of general fund assets including the initial annual transfer from the General Fund
to the Capital Renewal and Replacement Fund, for Fiscal Year 2004/05, in the amount of
$1,347,070; and
WHEREAS, on September 28th 2004, the Mayor and Commission further directed
that more stringent criteria be established regarding the use of these funds; and
WHEREAS, the City has a significant infrastructure investment that includes 322
buildings, structures and facilities; 472 acres of recreational open space; over 25 miles of
inland canals, oceanfront beaches, City-owned seawalls; and 140 miles of paved streets;
with associated swales landscaped medians, street and landscape lights, and curbs and
gutters; and
WHEREAS, despite $27.4 million budgeted in the Fiscal Year (FY) 2004/05 General
Fund Operating Budget for general ongoing maintenance, as well as $4.25 million funding
from the proposed Miami-Dade County General Obligation Bond issue for Old City Hall; the
Sixth Street Community Center; Flagler Monument; and Scott Rakow Youth Center
improvements, there remains $1,816,000 in immediate renewal and replacement needs
without funding; and
WHEREAS, the City in process of developing a proactive schedule of renewal and
replacement needs for the City's existing infrastructure that will require additional funding in
future years; and
WHEREAS, as a result of the City's ongoing $400 million Capital Improvement
Program, there will be a significant additional increase in renewal and replacement needs;
and
WHEREAS, annual capital renewal and replacement needs compete for General
Fund resources with other needs, such as public safety, with the result that capital renewal
and replacement needs may be deferred; and
WHEREAS, bond rating agencies, (Moody's, and Standard & Poor's) view renewal
and replacement policies as a significant criteria in assessing a government's credit
worthiness; and
WHEREAS, the Mayor and City Commission recognize the need to maintain a
dedicated source of funding to ensure annual renewal and replacement of the City's
General Fund capital assets on an ongoing basis; and
WHEREAS, there is a need to maintain flexibility in the use of the funds in the event
that the City Commission is faced with an emergency project or event.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that Resolution 2004-24697
is hereby amended as follows:
1. A permanent Capital Renewal and Replacement Fund is hereby established to be
used for capital projects that extend the useful life ofthe City's General Fund assets
shall be limited to projects defined as follows:
A. Projects that extend the useful life of a asset by at least 5 years
with a threshold value of at least $25,000; for example the
replacement of a major component of the asset such as roofs,
HV AC systems, electrical systems, fire alarm systems, sprinkler
systems that due to significant deterioration would constrain the
remaining useful life of the asset,
OR
B. Projects that significantly reduce future maintenance cost over the
remaining life of the asset in an amount that is greater than the
renewal and replacement costs of the project.
2. The Mayor and Commission may authorize additional uses of the funds for
unforeseen or unanticipated events affecting life, health, property or public safety
subject to a five-sevenths (5/7) vote.
3. The Capital Renewal and Replacement Fund shall be funded annually,
commencing in Fiscal Year 2004/05, through a transfer from the General Fund.
4. The initial annual transfer from the General Fund to the Capital Renewal and
Replacement Fund, for Fiscal Year 2004/05, shall be the amount of $1 ,347,070.
5. In subsequent fiscal years, the Fund will be increased by, at a minimum, the amount
which would represent the value of the debt service millage reduction resulting from
growth in the assessment value of the tax base. It is expected that this increase
should not result in a total combined millage rate greater than in the preceding fiscal
year.
6. Appropriation of project specific expenditures from the Capital Renewal and
Replacement Fund shall be included in the City Manager's annual proposed budget
based on an annual recommendation of the City Manager or his designee regarding
range of asset life extended; identification of fully depreciated or deteriorated
components of City assets; inventory requirements for large capital components of
assets; or reduction in maintenance costs over the remaining life of the asset.
7. Appropriation of project specific expenditures shall be adopted by the Mayor and
City Commission.
8. Interest earnings that accrue in the Capital Renewal and Replacement Fund shall
be included in the appropriation for the Fund in the following fiscal year.
9. Changes among project specific appropriations may be authorized by the City
Manager to the extent that no new projects be added and the total annual allocation
is not exceeded.
10. During a fiscal year, changes to the total allocation and changes to the list of
projects to be funded from the Capital Renewal and Replacement Fund shall
require prior approval and authorization by a majority of the City Commission.
Excess project specific appropriations not required will be available for re-
appropriation the following year.
11. Project specific appropriations that are not expended in a given fiscal year shall
remain in the Capital Renewal and Replacement Fund for the life of the project.
12. The City of Miami Beach hereby amends the FY 2004/05 Capital Renewal and
Replacement Fund Budget, in the amount of $1,347,070, as provided in Attachment
A.
PASSED AND ADOPTED THIS2ih'a DAY 0
-'
2005.
hL~ IMr1A
CITY CLERK
APPROVED AS TO
FORM & LANGUAGE
& FOR exECUTION
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City Attorn g
ATTACHMENT A
Old Ci Hall
Re lace Floors at Fire Station 1 and 3
Police Station Emer enc Chiller Re lacement
Police Gun Ran e Air Handlin Unit
$500,000
120,000
120,000
30,000
40 000
80,000
63 000
63,000
45,000
99,000
10 500
Public Works 0 erations Yard A/C Re lacement
Police Station Water Sealin
Cit Hall Water Sealin
Fire Station 1 Domestic Water Line Re lacement
Re lace Three Air Handlers at the Police Station
Contin enc for Unforseen Needs
176,570
TOTAL $1,347,070
Criteria 1.A
Criteria 1.A
Criteria 1.A
Criteria 1.A
Criteria 1.A
Criteria 1.A
Criteria 1.A
Criteria 1.A
Criteria 1.A
Criteria 1.A
Criteria 2
CITY OF MIAMI BEACH
COMMISSION ITEM SUMMARY
m
Condensed Title:
Amend Resolution 2004-25697 which established a Capital Renewal and Replacement Fund to provide a
dedicated source of funding for city capital renewal and replacement projects that extend the useful life of
General Fund assets.
Issue:
Whether to amend Resolution 2004-25697 to establish more stringent criteria for the use of these funds as
directed by the Mayor and Commission?
Item Summary/Recommendation:
Amend Resolution 2004-25697 to establish more stringent criteria for the use of these funds by
summarizing the criteria into three critical areas; include a preamble/whereas clause pertaining to
emergency use of funds; and provide a provision for emergency use of the funds.
Adviso Board Recommendation:
Approved by the Finance and Citywide Projects Committee on February 17, 2005.
Financial Information:
Amount to be expended:
Finance Dept.
Source of
Funds:
D
AGENDA ITEM
DATE
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CITY OF MIAMI BEACH
CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139
www.ci.miami-beach.fl.us
COMMISSION MEMORANDUM
To:
Mayor David Dermer and
Members of the City Commission
Date: February 23, 2005
From:
Jorge M. Gonzalez ~.
City Manager U V
Subject:
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, AMENDING RESOLUTION 2004-25697
WHICH ESTABLISHED A CAPITAL RENEWAL AND REPLACEMENT
FUND TO PROVIDE A DEDICATED SOURCE OF FUNDING FOR CITY
CAPITAL RENEWAL AND REPLACEMENT PROJECTS THAT EXTEND
THE USEFUL LIFE OF GENERAL FUND ASSETS; ESTABLISHED A
PROCEDURE FOR ANNUAL APPROPRIATION OF FUNDS;
ESTABLISHED A PROCEDURE FOR THEIR USE; AND ADOPTED THE
FISCAL YEAR (FY) 2004/05 BUDGET FOR THE FUND, IN THE AMOUNT
OF $1,347,070.
ADMINISTRATION RECOMMENDATION
Adopt the Resolution.
ANAL YSIS
At the second Budget Hearing on September 28, 2004, the Commission adopted Resolution No.
2004-25697, establishing a Capital Renewal and Replacement fund for general fund assets and
procedures for appropriation and use of funds. Through the Resolution, the Commission approved
the appropriation of $80,000 for the replacement offloors at Fire Station No.'s 1 and 3. The balance
of funds in the amount of $1,267,070 was placed in reserves and the Commission directed the
Administration to provide the Finance and Citywide Projects Committee with additional criteria for
project specific appropriations from the Capital Renewal and Replacement Fund. A proposed set of
additional criteria was reviewed by the Finance and Citywide Projects Committee on December 14,
2004. At that meeting, the Committee instructed the administration to:
o Summarize the criteria into three critical areas
o Include a preamble/whereas clause pertaining to emergency use of funds
o Provide a provision for emergency use of the funds
February 23, 2005
Page 2
The attached resolution amending Resolution No. 2004-25697, establishing a Capital Renewal and
Replacement fund, incorporates these items. On February 17, 2005, the Finance and Citywide
Projects Committee approved the resolution. The criteria incorporated are:
1. The permanent Capital Renewal and Replacement Fund established to be used for
capital projects that extend the useful life of the City's General Fund assets shall be
limited to projects defined as follows:
A. Projects that extend the useful life of a asset by at least 5 years with a threshold
value of at least $25,000; for example the replacement of a major component of
the asset such as roofs, HV AC systems, electrical systems, fire alarm systems,
sprinkler systems that due to significant deterioration would constrain the
remaining useful life of the asset
OR
B. Projects that significantly reduce future maintenance cost over the remaining life
of the asset in an amount that is greater than the renewal and replacement costs
of the project.
2. The Mayor and Commission may authorize additional uses of the funds for unforeseen
or unanticipated events affecting life, health, property or public safety subject to a five-
sevenths (5/7) vote.
Concurrent with the establishment of a dedicated renewal and replacement reserve for
general fund assets, the City is developing of a schedule of renewal, replacement, and
routine maintenance requirements for the City's buildings, structures and facilities. Major
tasks to develop this schedule include 1) inspecting the City's buildings, structures and
facilities; 2) procuring Capital Planning and Management Solution software and inputting
the inspection results; and 3) forecasting component requirements for the life of each
asset. The City anticipates completing this process for 5 buildings this calendar year - City
Hall, Old City Hall, Police, the 777 Building, and Carl Fisher Clubhouse/21st Street
Auditorium). The process for the remaining facilities and structures is planned to be
completed within the next 4 years. As the renewal and replacement requirements are
identified for the major components, they will be incorporated into future year project lists
for review by the Mayor and Commission during the budget process. Routine maintenance
requirements identified will be addressed elsewhere.
JMG\KGB
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