Posted by Jim Minkey on 16th February 2010
Remember this? It was about a year ago that a delay was announced that told the folks that had signed up for the proposed new Mirabella project. This is the project that was set to complete the Parkview Plaza/15 acre site and sure has seemed to have been on the table for ages! If you recall, the plan to have a large senior center on this site was chosen a couple of years ago and sort of became controversial in parts of Foster City after the developer expanded the original plans and called for towers up to 12 stories.
That’s still the plan, but a week or so ago Pacific Retirement Services decided to return the $600,000 they had received in deposits from families who wanted to live in this project. Since the developers exclusive right to negotiate expires on April 1 of this year, and the SM-FC school board sort of would like to build a fourth elementary school around here, I think we can expect some discussion about the future use of this land…again.
The PRS folks are still saying they want to build on this site…so who knows? I personally love the idea of a “downtown” type destination for Foster City and while this plan wasn’t exactly Santana Row it’s better than alot of alternatives. I have no doubt that the City would love the long term revenue that would be produced by this project so I think we can expect that they will be pretty firm in their commitment to it, or something very much like it going forward. We’ll see. Anyway, here’s a SM Daily Journal link to a story about it:
http://www.smdailyjournal.com/article_preview.php?id=124776
Posted in 15 Acre Site-Village Square, Foster City, Parkview Plaza | No Comments »
Posted by Jim Minkey on 24th February 2009
If you’ve read this blog for awhile you’ve no doubt noticed the participation of the great and wonderful Steve Toler, Foster City’s director of Aministrative Services. Steve’s a really terrific guy and a few weeks ago he e-mailed me some information about the state of Foster City in this current downturn and I thought it would be pertinent to print it “As Is” It’s good news, by and large, and speaks to how solid this community is…and will be going forward. Here we go, in the words of Mr. Toler himself:
“We presented our mid-year financial picture to the Council this week. In case it’s interesting info to add to a blog entry in the near future about the impact this economy is having locally, here are the big issues we are facing:
The executive summary is that the City is in a healthy financial position. We have $18 million in General Fund reserves (I explain why that’s important below), and have been blessed with good decision making the past 40 years to have a healthy mix of revenues. It is not planned to reduce any services at this time. Nevertheless, we are being conservative in our financial projections and are going to be vigilant in the next 5 years in ensuring we stay financially solvent while maintaining services at their existing levels.
Other than water, sewer, and certain capital projects, for the most part the City relies on property taxes, sales taxes, vehicle license fees, franchise taxes (from AT&T, Comcast, PG&E) and transient occupancy (hotel) taxes to pay for police, fire, parks & recreation, and the various other services residents enjoy. This is known as the City’s “General Fund”, and is the most important fund we balance in any given year. With that as background…
- Property taxes are holding their own at a 4% growth from the previous year, right on target with what the City projected. Our total property tax revenue is about $11 million. As you’ve indicated in your blog, we are seeing relatively few foreclosures and vacant properties, so the taxes are being paid at their assessed values back in January 2008. That being said, real property transfer taxes (the one-time “make up” you have to do when you buy a home) is significantly down from last year, by about 50%, given the slowdown in the market.
- Sales taxes are hurting … we are currently about 15% below our original projections, and I expect we will be 20% below projections by year end, that will be about a $1 million shot across the bow. We assumed $5 million at the beginning of the year, but it’s looking more like $4 million.
- Vehicle license fees, what we pay to the State for our car registration each year, come back to the cities to fund road projects, street maintenance, etc. Those revenues are holding their own (~ $2.5 million), but the impact of fewer and fewer new cars being purchased may drop that next year.
- Franchise taxes (~ $1 million) are holding their own, and we may even see a bit of an increase as more people spend money on television services like Comcast and AT&T UVerse during a recessionary period.
- Transient occupany taxes ($1.5 million) are also holding their own, predominantly due to the fact that the Crowne Plaza has successfully negotiatied contracts with various airlines to house their flight crews. However, if the economy takes its toll on business and personal travel, those revenues could slip in future years. FYI, Foster City’s TOT rate is 8%, the lowest in the County. In fact, every other city has their TOT rate at 10%, with some at 12%. Cities hurting financially are looking at increasing their TOT rates right now. Council has indicated they are not interested in doing that at this time.
Given all of this, the City’s General Fund reserves remain healthy at over $18 million. To put this into perspective, cities and non-profit agencies strive to maintain 25% (or 90 days) of annual expenses in their reserves to allow them time to “tack and jibe” if revenues were to dry up. The City’s reserves are ~ 60% of annual operating expenditures. We have been, and intend to continue to be, good stewards of the financial resources we have been entrusted to manage. That being said, we believe that we probably won’t see the bottom of this economic recession for at least another 18-24 months. We’ve already seen a delay in the Mirabella / Parkview Plaza project for at least one year as the developer assesses the credit crunch that is impacting its ability to fund the project. The lease agreement would have pumped $2 million into the City’s General Fund to allow us to proactively fund capital improvement projects like parks, roadway improvements, and city facility improvements. We are now determining what impact the delay in development may have on long-term capital financing requirements and city services over the next 5 years.
A ray of sunshine, however, was the sale of one of the EFI buildings plus its undeveloped land to Gilead Sciences, which closed on January 29. This will pump approximately $800k in additional property tax revenues into the City’s General Fund annually, and will allow Gilead to continue their plan to develop the Lakeside Drive area into a prime research facility and campus.”
Posted in 15 Acre Site-Village Square, Chess Drive and Gilead Projects, Foster City | 7 Comments »
Posted by Jim Minkey on 15th January 2009
The folks that were planning to make the move into the new Mirabella community that is planned on the big 15 acre site, or Parkview Plaza received a letter a few weeks ago announcing that the project is going to experience a delay for at least a year due to our current economic climate. The sales staff isn’t functioning there anymore and the folks who have made deposits are entitled to change their minds at this point and get refunds.
I guess the cynical part of me thinks, Oh no…is this thing ever going to happen? I really do hope so. It’s understandable that in this environment, obtaining financing and boldly moving forward with projects the size of this one could be delayed. I’ve been on record as favoring this project, it’s going to be great for the community…and I’m tired of that big vacant lot! This artist’s depiction sure makes the project look good, doesn’t it? Anyway, here’s a link to a San Mateo County Times story about this delay:
MirabellaDelay
Posted in 15 Acre Site-Village Square, Foster City, Parkview Plaza | 9 Comments »
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