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1
cc15_054
STAFF REPORT
MEETING
DATE: March 31, 2015
TO: City Council
FROM: Cathy Capriola, Assistant City Manager
PRESENTER: Cathy Capriola, Assistant City Manager
Matt Greenberg, Park Manager
SUBJECT: MID-YEAR BUDGET UPDATE AND APPROVAL OF CAPITAL
BUDGET ADJUSTMENT
REQUEST
Consider 1.) Receiving an update report from Frei Real Estate Services on the mid-year budget for
MVMCC and 2.) Approving the following minor budget adjustments to the FY 14/15 MVMCC
Capital Improvement Program budget due to an unforeseen capital need to fund improvements to
the detection and cathodic protection system within the gas utility system which results in no net
increase to the capital budget:
1. Decrease the New Ballroom Floor from $50,000 to $40,000.
2. Increase the Gas Utility Capital line item from zero to $10,000.
RECOMMENDATION
Receive report and approve budget adjustments.
DISCUSSION
Each year, Frei Real Estate provides a Mid-Year Budget Report and delivers a written
memorandum to the PAC and the City. Attached is a copy of this report. Mr. Frei reports that
there is the need for a realignment within the Capital Budget due to an unforeseen capital need
within the gas utility system. The budget adjustments outlined below will not result in an increase
to the capital budget.
MVMCC has a cathodic protection system to protect underground utility pipes from corroding due
to electrolysis. After review, there is a need to replace a worn out rectifier and anode bed for a
total cost estimated at $9,400. Additional background regarding this system and need are outlined
in the attached Mid-Year Budget Report. Management is recommending that the funding for this
unanticipated capital expense be taken from the Ballroom Floor line item which will not be
undertaken this year.
922 Machin Avenue Novato, CA 94945
(415) 899-8900 FAX (415) 899-8213
www.novato.org
1
2
FISCAL IMPACT
There is funding within the current capital budget to absorb this unforeseen gas utility system need.
There is no increase to the capital budget if this budget adjustment is approved.
ATTACHMENTS
1. January 26, 2015 Mid-Year Budget Review – FY 6/30/2015 Memorandum from Al Frei
2
FRET REAL ESTATE SERVICES834t) AUBURN BLVD. • SUITE 100 • CITRUS HEIGHTS, CA 95610 • (916) 722-8110 FAX (916) 722-8111
DATE: January 26, 2015
TO: City of NovatoPark Acquisition Corporation
FROM: Al Frei
RE: Mann Valley Mobile Country ClubMid Year Budget Review — FY 6/30/15
Summary
Our mid-year budget review ending 12/31/14 shows a total deviation of 15.06% under-budget inoperating costs (middle of page 4).
Significant Budget Deviations
ExpensesWages-Office Manager — Jane has continued to work extra hours in order toallow Matt additional time to resolving Park issues.Garbage — A greater than expected rate increase along with additional temporarybins which were brought in for Park cleanup/brush clearing.Fire Abatement — A considerable amount of brush clearing has been necessaryaround the Park to meet fire department requirements.Pool Supplies & Equipment — The Park installed a chemical control system andhired a pool company to monitor the pool and spa chemical levels.
> Trees - Several dead or leaning trees that were in danger of causing propertydamage were removed.Licenses & Permits - The most expensive fee, HCD annual permit ($4,383) hasalready been paid.
RECOMMENDATIONS:
OPERATING BUDGETWhile a few specific expense items (listed above) have costs exceeding the budgetedamount, no category has exceeded its budgeted amount. Management recommends norevision to the operating budget.
CAPITAL PLAN
Major Completed Projects:Asphalt driveways and ctil-de-sacs
Mann View DriveClub View Drive
Emergency Generator
3
Retaining Walls at:39 Scenic Drive120 Sunrise Lane13 Fallen Leaf Drive36 Mann Valley Drive
Slopes/Drains/V-Ditches at:12 Fallen Leaf Drive12$ Panorama Drive184 Mann Valley Drive4$ Club View Drive41 Club View Drive19 Mann View Drive
Projects in Process or Upcoming Projects:Asphalt Repairs/Crack FillsClubhouse Shades & AwningsClubhouse Exterior Paint/CarpentryClubhouse Flat Roof/BeamsRetaining Walls at:
106 Panorama Drive17 Club View Drive
Gas Shut Off Valve
RECOMMENDATIONS:
CAPITAL BUDGETThe park has a cathodic protection system to protect underground utility pipes from corroding dueto electrolysis. There are three anode beds (see attached description) in the Park. One at 134Sunrise between 134 & 31 Club View, one at 3 Mann Valley Drive, and one at 47 Mann ValleyDrive (see attached map). Jarsco Utilities Inc., the company who performs our annual gas leakdetection and cathodic protection system survey identified a worn out rectifier and anode bed atspace 47. The cost to replace both is $9,400. This is a capital plan expense that was notanticipated this year.
Management’s recommendation is to reduce the $50,000 budget for ballroom floor replacementscheduled for this year by $9,400, move the $9,400 to the utility item, and move out the ballroomfloor to 2015/20 16 since it will not be done until all handicap modifications in the clubhouse arecompleted.
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beds involves burying a magnesium or
zinc anode in the soil and connecting it
to a pipeline by welding the copper wire
running from the anode
to the surface of the pipeline.
A pipeline may have as few as one, or
many anodes connected to it.
The sole purpose for installing an anode
bed is that it controls corrosion of an
existing pipeline.
I.E. Cathodic protection: CathodicProtection (CP) is a technique usedto control the corrosion of a metalsurface by making it the cathode ofan electrochemical cell. A simplemethod of protection connectsprotected metal to a more easilycorroded “sacrificial metal” to act asthe anode. The sacrificial metal thencorrodes instead of the protectedmetal. For structures such as longpipelines, where passive galvaniccathodic protection is not adequate,an external DC electrical powersource is used to provide sufficientcurrent.
BY
Cathodic protection systems protecta wide range of metallic structures invarious environments. Commonapplications are: steel pipelines.Another common application is ingalvanized steel, in which asacrificial protects them fromrust. I.E. Anode Bed. Corrodedanode below
For pipelines, anodes are arranged in groundbeds eitherdistributed or in a deep vertical hole depending on severaldesign and field condition factors including currentdistribution requirements.
Rectifier:
Cathodic protection transformer-rectifier units are oflencustom manufactured and equipped with a variety offeatures, including remote monitoring and control, integralcurrent interrupters and various type of electrical enclosures.The output DC negative terminal is connected to thestructure to be protected by the cathodic protectionsystem. The rectifier output DC positive cable isconnected to the anodes. The AC power cable is connectedto the rectifier input terminals
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