COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Environmental Services Agency

DATE:

September 18, 2003

BOARD MEETING DATE:

October 7, 2003

TO:

Honorable Board of Supervisors

FROM:

Marcia Raines, Environmental Services Agency Director

SUBJECT:

Library Joint Powers Agreement (JPA) Governance Issues and Half Moon Bay Library Project Report

Recommendation

Accept a report regarding:

1)

Library JPA Governance Issues

2)

Half Moon Bay Library Project

Background and Discussion

1)

Library JPA Governance Issues

The Library JPA was formed in January 1999 and will reach a five-year mark in January 2004. The members of the Library JPA are the County, the Cities of Belmont, Brisbane, East Palo Alto, Foster City, Half Moon Bay, Millbrae, Pacifica, San Carlos, and the Towns of Atherton, Portola Valley and Woodside.

The JPA provides a remarkably good level of service to the eleven cities and towns, plus the Town of Colma and residents of the unincorporated County. During the first four years, the JPA has functioned well but experienced some growing pains. Over the past two years in particular, the JPA has discussed and attempted to resolve several governance issues. At the June Recommended Budget Hearings, the Board of Supervisors asked that a study session be conducted regarding these governance issues.

Over the past few months, a consultant, Management Partners, was brought in to assist the JPA in outlining a process for resolving the following main issues:

1.

Role of the Governing Board

2.

Library Director Employment and Performance

3.

Staffing and Administrative Procedures

4.

Budget

5.

The County General Fund Contribution/Use of Unincorporated Tax Proceeds

6.

Depository for Funds - Treasurer and Audit Services

Over the past several months, the consultant has been working with the JPA to resolve these issues and identify the most efficient management options for the JPA while continuing the current high level of operational efficiencies. In August 2003, the consultant presented the report's findings to the JPA Board, which proceeded to approve five of the six approaches to the six issues. The JPA Board appointed a subcommittee to resolve the final issue, the County General Fund Contribution/Use of Unincorporated Tax Proceeds. The JPA Board meets on October 6, 2003 to review and recommend this item. An update on the JPA Board's action will be presented at the October 7, 2003 study session.

The JPA Board will consider a consulting contract on October 6, 2003 that will provide for the same consultant to perform the tasks associated with implementation of the changes to the JPA Agreement outlined here. These changes are targeted revisions to the original Joint Powers Agreement that can and should be made to ensure the viability of the system. These changes can allow the library sufficient autonomy to function in a way that meets the intent of the member jurisdictions while respecting the role and responsibilities of the County.

The consultant's recommendations were as follows:

1.

Role of the Governing Board

The recommendation endorsed by the full JPA Board is to amend the JPA agreement to clarify the Governing Board's role regarding policy, particularly in relation to the County.  The underlying theme of the recommendation is that the JPA Board is responsible for providing policy direction for the library system and the County role is to administer adopted policy in accordance with a contract (to be developed) for staff services.

Under the recommendation, the JPA Board would be responsible for providing policy direction within the annual budget.  The budget would be approved by both the Board of Supervisors and the JPA Board.

2.

Library Director Employment and Performance

The recommendation endorsed by the JPA Board would amend the JPA Agreement to clearly define the responsibilities of the Director to the County and to the Governing Board. The Director would report to the JPA on operation and policy

issues and be accountable to the County on defined administrative and personnel matters as well as other contracted services.

Dispute resolution provisions are included in the recommendation to deal with inevitable grey areas.   A committee of Governing Board, Operations Committee and County representatives would work together to resolve any areas where disputes arise, to recruit a director, and to perform necessary evaluations as recommendations to the County Manager.  The County would retain final authority over the Director under this proposal.

3.

Staffing and Administrative Procedures

This recommendation includes the preparation of a separate, more detailed agreement between the JPA and the County clarifying the relationship between the County and the JPA regarding staffing matters.   The JPA would establish the right to provide for support services separate from the County.  However, while the JPA contracts with the County for staff services, it shall utilize the personnel and payroll support services of the County.

4.

Budget

This recommendation involves modifying the JPA agreement to reflect the budgetary relationship between the County and the JPA.  This can largely be modeled after current practice in which the JPA submits an annual budget to the Board of Supervisors via the County Manager.  The budget is reviewed and approved by the County.  The County Adopted Budget constitutes an annual appropriation to the JPA.  The JPA Board then makes spending decisions up to the total appropriation.  Any changes to the personnel, services and supplies and capital budget will require an action of the Board of Supervisors.

5.

The County General Fund Contribution/Use of Unincorporated Tax Proceeds 

This portion of the proposal is still under consideration by the JPA Board.  A subcommittee appointed by the JPA Board is meeting to draft language agreeable to both the County and the cities.  As it currently stands, the County is seeking control of the General Fund portion of the annual contribution (currently estimated at $275,000) and the property tax allocation fee waiver (estimated at $43,000).  To avoid impact to library operations there can be a limit established for the maximum allowed withdrawal in any given year (perhaps not more than 1/3 of the total).  This proposal allows the County to enjoy the return to source privilege that the city members of the JPA currently have.

In addition to the General Fund contribution, the County is seeking to establish a more equitable distribution of JPA funding to the unincorporated area.  It appears that areas such as North Fair Oaks are not currently receiving comparable dollars. The current proposal is to identify the funding discrepancy and to evaluate the

services available to residents of these areas.  The staff will evaluate methods of enhancing services to potentially underserved areas and report to the JPA Board with recommendations on impacts to system-wide services.

6.

Depository for Funds - Treasurer and Audit Services

The discussion on this issue centered on whether the JPA should retain County treasurer and audit services or possibly contract with other providers.   The JPA Board has endorsed the consultant proposal that the JPA stay with the County services in this instance.

2)

Half Moon Bay Library Project

The JPA relating to Library Services states (XIV Financial Provisions, F) "In the event the City of Half Moon Bay decides to either replace or significantly remodel and expand the Half Moon Bay Library, the County agrees to contribute 50% of the costs associated with any such replacement or remodeling in recognition that approximately 50% of the population served by the Half Moon Bay Library comes from unincorporated areas. If there is a significant change in the unincorporated area population either by annexation to the City of Half Moon Bay or incorporation of a new city then the County contribution to the remodel or expansion of the Half Moon Bay Library will be renegotiated by the County and the City of Half Moon Bay."

In March 2003 the City of Half Moon Bay as the lead agency filed an application with the State of California for construction monies available from the California Reading and Literacy Improvement and Public Library Construction and Renovation Board Act of 2000, also known as the Library Bond Act of 2000.

The State grants are available through a highly competitive process on a 65% State to 35% local matching fund basis. Half Moon Bay requested $12,103,978 in grant funds. The total project cost (exclusive of equipment and furnishings) is $18,944,744. The remaining $6,517,526 would be shared equally by the City of Half Moon Bay and the County. Each would contribute $3,258,763 with the City of Half Moon Bay managing the project. The State grant awards are expected to be announced in September or October of 2003. If Half Moon Bay receives the award, construction documents would need to be completed, with construction starting approximately January 2005 and an estimated opening of the new facility in January 2006.

The Library to be constructed would be 33,600 square feet and would be a two-story facility with underground parking and would be entirely on the existing site at 620 Correas Street, Half Moon Bay. The Library is currently 7,800 square feet and serves the Half Moon Bay population of 11,842 (when the current Library, opened it served a population of 4,320) and the surrounding unincorporated population of 17,170. By 2020, the overall service population is expected to grow by 25% to

reach an estimated 36,284. Prior to Proposition 13, the Coastside residents were served by three libraries at Pescadero, El Granada and Half Moon Bay. In the mid-80's, the Bookmobile was relocated from the Bayside to exclusively serve the Coastside and mountain communities. The Bookmobile staff and services operate out of the Half Moon Bay Library and use the library materials from the Half Moon Bay Library. In addition, a Project Read Literacy Program serving primarily agricultural workers of the Coastside operates out of the Half Moon Bay Library.

The Library project is based on an in-depth Building Program derived from an extensive community library needs assessment from a subsequent Library Plan of Service developed by Library staff. The City of Half Moon Bay engaged the architectural firm of Group 4 of South San Francisco and a grant writer and Project Coordinator. Library staff was fully involved throughout the process. Serving the student population of this 270 square mile area is a high priority for the Half Moon Bay Library with schools located from Montara, La Honda, Kings Mountain to Pescadero.

County staff has reviewed the project budget and will bring an agreement to the Board in the near future.

Vision Alignment

The report on JPA discussions and the Half Moon Bay Library facility keeps the commitment of responsive, effective and collaborative government and goal number 22: County and local governments effectively communicate, collaborate and develop strategic approaches to issues affecting the entire County. The report contributes to this commitment and goal by ensuring library services are provided to residents of the County in the most cost effective, efficient means possible.

Fiscal Impact

There is no fiscal impact in accepting the report, however there will be a future impact to the County once JPA discussions are finalized pertaining to the County General Fund Contribution/Use of Unincorporated Tax Proceeds. Should the County retain the General Fund contribution, there will be savings of approximately $318,000.

Should the Half Moon Bay Library grant be obtained and the project proceeds, the County would be asked to contribute $3,258,763 to the project. Funding for this project will need to be allocated to the County's Capital Projects budget and will be discussed when the grant is obtained and the project brought forward to the Board of Supervisors.