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maintenance costs once the park improvements are completed. Additional funding options are included in the Plan. Approval of a construction contract and development costs are included as part of the November 6 City Council agenda. BACKGROUND In January 2007 the Council formed the Bernal Financing Committee (Committee) consisting of Councilmembers Thorne and McGovern, the City Manager, City Attorney, Director of Finance and the Economic Development Fiscal Officer. The Committee has spent the past eight months developing the Bernal Financing Plan (Plan) (Attachment A) to be presented to the Council for its approval. As indicated, the purpose of the Plan is to provide the funding options for Program improvements. DISCUSSION The Program includes improvements identified in the Phase II Specific Plan as ratified by the voters in 2006 (Measure P). Program costs, including construction, acquisition and operating costs, total approximately $160.8M over seventeen years as outlined in the Plan. The table below presents a brief description of each of the projects within the Program, the estimated cost of the project and an estimate of the additional operating costs associated with the project. PROGRAM CAPITAL AND OPERATION COSTS Descri tion~~~ Estimated Ca ital Costs Estimated Additional O eratin Costs~Z~ Bernal Communit Park Phase I $ 8.8 million $ 348,080 Phase II 7.3 million 220,888 Phase III and IV 10.8 million 326,608 O en S ace 30.0 million 540,904 Communit Center 16.0 million 121,410 Youth Center 16.0 million 121,410 Civic Arts Center 40.0 million 202.430 Total $128.9 million $ 1,881,730 ``' See Appendix A for a complete description of the projects and the basis for estimates contained in Table 1 above. (2> Operating Costs are as of 2007/08FY. Each year thereafter it is assumed that the operating costs will increase by 3% per year. Therefore, assuming all the projects are on-line by the 2024FY, the total operating costs are projected to be $3,110,213. The Committee reviewed existing and forecasted City General Fund and capital improvement revenues and identified the potential for $52.7M that could be dedicated to financing the Program on a "pay-as-you-go" basis. However, based on Program cost projections, these revenues leave a funding gap of approximately $108.1 M needed to fully complete the Program. To address this gap, the Committee is recommending a review and potential increase to existing developer impact fees, the existing transient occupancy tax and the future exploration of potential new revenue sources including the issuance of general obligation bonds. Page 2 of 3