Citywide bond for $35 mil?

GILROY
– In a special meeting Wednesday night designed to produce
solutions to improve downtown, City Council discussed creating a
bond that would essentially clear the deck for $35 million in
citywide improvements – most of which would occur downtown.
GILROY – In a special meeting Wednesday night designed to produce solutions to improve downtown, City Council discussed creating a bond that would essentially clear the deck for $35 million in citywide improvements – most of which would occur downtown.

“If it works we can actually bond for the entire amount,” said Councilman Peter Arellano. “It seems like we have a lot of things that have been on the table for too long so let’s take care of them if we can.”

Currently all that stands in the way of Council and finding money for an improved downtown is more than the $35 million in citywide unfunded liabilities.

These liabilities include the $3.5 to $4 million Sidewalk Repair Program, the $4.1 million Downtown Monterey Streetscape plan, the $9.3 million Pavement Management Program and the $18 million Storm Drainage Program – all plans made by past Councils which are currently unfunded by the city.

Bonding to make these improvements would set the ground work – literally – to revitalize Gilroy’s downtown, several members of Council said.

Nearly 40 members of the public in attendance – mostly downtown merchants and property owners – were also given a chance to ask questions about their concerns for downtown at the end of the meeting.

During the meeting City Manager Jay Baksa presented Council with an overview the city’s current funds and liabilities in an effort to earmark city money and create new money for downtown improvements. As it became evident that the cost of fulfilling the current needs projects was essential to improving downtown, the issue of bonding began to be discussed.

“I say let’s bond and get these improvements going as soon as possible,” said Al Pinheiro, the councilman who suggested the meeting after a proposed Redevelopment Agency was recently killed by Council. “The faster we get these things taken care of, the faster we can start reaping the benefits of an improved downtown.”

With current General Fund reserves projected to dramatically decrease in the next five years, very little if any money will be available for the improvements from city, Baksa said. Due to rising salary and benefit costs of city employees, plus the addition of a third fire station to the city and a new paramedic program, the General Fund will only stay in the black in the years to come because of new sales tax created by the city’s new retail developments east of Highway 152 and U.S. 101.

“There are not a whole lot of options (to fund downtown improvements) right now,” Baksa said. “Especially with the bad market.”

One solution Baksa gave to the Council was a “Trigger Plan” that would siphon general fund reserves into the capitol improvement budget so the money could be used for downtown improvements. However, Baksa warned the amount would be a small fraction of the $35 million, and leaving less than 10 percent reserve in the General Fund is a risky move.

Nearly 98 percent of the General Fund currently goes to city services such as police and city staff. Sidewalk repair is the only type of capital improvement coming from the fund, which was budgeted $200,000 last year.

“I believe our first role as a city is not to improve downtown but to provide public safety,” said Councilman Roland Velasco, arguing the importance of staying away from General Fund moneys for capitol improvements. “We need to wait until the general fund budget is done and presented to decide on what we should do as far as a bond goes.”

With the city’s 2003 General Fund budget analysis scheduled to be complete in April and presented to Council in May, several members of Council agreed Wednesday night to wait for the analysis before deciding on a bond for to complete the $35 million in unfunded liabilities.

“Our solutions need to be found outside the current money (the city has),” said Mayor Tom Springer. “I think it is worth it to take the risk of a bond over a 10- or 12-year period.”

In the meantime the city can look forward to a $1.6 million streetscape improvement between Seventh and Sixth streets in the next year similar to $2 million in renovations recently done between Seventh and Eighth streets. A state grant will pay for $1.4 million of the project, but for various reasons the city does not expect much more grant help from the state for its streetscape program in the future, leaving the $4 million it will take to complete the streetscape of Monterey – widening single walks along Monterey between Third and Sixth streets and replacing the snaking traffic strip to a straight, landscaped center median.

Although pleased with the high priority the improvement of downtown has been given by the Council, community members in attendance Wednesday night warned this is only one step in a very long process.

“I’m happy with the meeting tonight and I’m seeing a commitment to improvement,” said David Peoples, the director of the Gilroy Downtown Development Corporation. “I feel very strongly that we just have to continue to keep working at this. The streetscape alone is only a facade – once we get that we have to work on a whole lot more to bring new businesses and money to downtown.”

The Council will hold another study session at 6 p.m. on Nov. 13 to further discuss the improvement of downtown.

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