HomeMy WebLinkAbout12 - CC-12 - Renewed Measure M (M2) Eligibility - 6/15/20211
CITY COUNCIL AGENDA REPORT
MEETING DATE: JUNE 15, 2021 ITEM NUMBER: CC-12
SUBJECT:RENEWED MEASURE M (M2) ELIGIBILITY
DATE: MAY 24, 2021
FROM: PUBLIC SERVICES DEPARTMENT/TRANSPORTATION SERVICES
DIVISION
PRESENTATION
BY:
RAJA SETHURAMAN, PUBLIC SERVICES DIRECTOR
FOR FURTHER INFORMATION
CONTACT:
JENNIFER ROSALES, TRANSPORTATION
SERVICES MANAGER (714) 754-5343
RECOMMENDATIONS:
Staff recommends that the City Council:
1. Approve the City’s Maintenance of Effort (MOE) for Fiscal Year 2021-22
(Attachment 1); and
2. Approve the M2 Seven-Year Capital Improvement Program (CIP) comprised of the
City’s Five-Year and future year CIP for Fiscal Year 2021-22 through Fiscal Year
2027-28 (Attachment 2); and
3. Adopt Resolution No. 2021-xx for the Master Plan of Arterial Highways
Conformance and Mitigation Fee Program (Attachment 3).
BACKGROUND:
In November 1990, Orange County voters passed Measure M, the Revised Traffic
Improvement and Growth Management Ordinance. This Ordinance provided for the
establishment and implementation of a one-half percent retail transaction and use tax to
fund transportation improvements for a period of 20 years. The County of Orange Board
of Supervisors designated the Orange County Transportation Authority (OCTA) as the
local transportation authority responsible for administering the revenue from Measure M
that ended in 2011.
Renewed Measure M (M2) is a 30-year extension of the original program, approved by
voters in 2006. Like its predecessor, Renewed Measure M net revenues are generated
from the retail transaction and use tax of one-half percent. Net revenues contribute to two
(2) types of Renewed Measure M funding: Fair Share and Competitive.
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All Orange County cities are eligible for Fair Share funding, based on population, number
of existing Master Plan of Arterial Highways centerline miles, and taxable sales. For Fiscal
Year 2021-22, Costa Mesa is estimated to receive approximately $2.5 million in Fair
Share funds once OCTA eligibility requirements are met. Fulfilling these requirements will
also allow the City to qualify for competitive funding allocations.
ANALYSIS:
Every year, the Orange County Transportation Authority (OCTA) determines if a local
jurisdiction is eligible to receive Renewed Measure M Fair Share funding. To qualify for
funding through the OCTA, the City must submit the following eligibility requirements
established for Fiscal Year 2021-22, prior to the submittal deadline of June 30, 2021.
Maintenance of Effort (MOE) – The City is required to document and assure that the
City is maintaining a minimum level of funding for annual street and road expenditures
from sources other than Renewed Measure M funds. This is to ensure that Renewed
Measure M funds are used to supplement, and not replace or supplant, the existing
general funds or other revenues used for street and road improvements. Failure to meet
the MOE requirement may jeopardize the City’s eligibility and receipt of Fair Share
funding while also triggering an additional audit in order to get back into compliance the
subsequent year.
Due to the financial impacts from the COVID-19 pandemic and resulting decrease in
General Fund revenues, OCTA has allowed the City to comply with the FY 2021-22 MOE
requirement in one of two ways: an established MOE of $8.6 million based on the City’s
FY 2018-19 General Fund revenues; or 5.99 percent of general fund revenues of the
City’s FY 2021-22 budget.
Seven-Year Capital Improvement Program (CIP) – Each jurisdiction is required to
prepare an M2 Seven-Year CIP. The CIP is an extensive list of projects anticipated to
meet and maintain the adopted traffic Level of Service (LOS) and Performance
Standards, as well as to maintain a satisfactory driving surface. A project must also be
on this Seven-Year CIP list in order for it to be eligible for Renewed Measure M
competitive grant funds, or other types of State or Federal funds, should they become
available. The M2 Seven-Year CIP is comprised of the City’s Five-Year CIP and the future
year CIP.
Resolution of Master Plan of Arterial Highways (MPAH) and Mitigation Fee Program
OCTA requires jurisdictions to adopt a resolution attesting that no unilateral reduction in
lanes has been made on any City arterials appearing on OCTA’s MPAH (Attachment 3).
The resolution also certifies that a mitigation fee program is in place. The City Council
previously approved a resolution for Traffic Impact Fees, Resolution No. 2020-60, which
satisfies this requirement.
Traffic Forums – The City is required to participate in Traffic Forums. City staff
participated in various working group sessions hosted by OCTA.
With the approval and submittal of the above-listed documents to the OCTA, the City
meets the eligible requirements for funding, estimated at approximately $2.5 million, from
the County’s Renewed Measure M one-half percent sales tax initiative for Fiscal Year
2021-22. Elimination of any projects from the M2 Seven-Year CIP may jeopardize
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possible future grant funding for that particular project, should grant funding become
available. Staff requests City Council approval of the recommended actions.
ALTERNATIVES CONSIDERED:
The City Council may elect to not approve or to modify the submittals. This may result in
the City not being in compliance with the eligibility requirements and the potential risk of
losing Measure M2 grant funding. Failure to meet such requirements may also result in
an additional audit to bring the City back into compliance the subsequent year.
FISCAL REVIEW:
The Finance Department has prepared and signed the Maintenance of Effort (MOE) form
(Attachment 1) certifying that the City has budgeted and will meet the MOE minimum level
of funding requirement for Fiscal Year 2021-22.
LEGAL REVIEW:
The City Attorney’s Office has reviewed this agenda report and the Resolution for the
Master Plan of Arterial Highways Conformance and Mitigation Fee Program (Attachment
3) and approves them as to form.
CITY COUNCIL GOALS & PRIORITIES:
The recommendation supports the following City Council Goals:
Achieve Long-Term Fiscal Sustainability;
Strengthen Public Safety and Keep the Community Safe; and
Maintain and Enhance the City’s Infrastructure, Facilities, Equipment, and
Technology.
CONCLUSION:
The City of Costa Mesa, like other Orange County cities, is required to annually adopt
and/or approve certain items in order to remain eligible for grant funds from the Renewed
Measure M program. Accordingly, staff recommends that the City Council approve the
proposed Maintenance of Effort (MOE), the Seven-Year Capital Improvement Program
(CIP) consisting of the City’s Five-Year CIP and future year CIP, and the Resolution
certifying compliance with OCTA’s Master Plan of Arterial Highways and Mitigation Fee
Program.
JENNIFER ROSALES RAJA SETHURAMAN
Transportation Services Manager Public Services Director
CAROL MOLINA KIMBERLY HALL BARLOW
Finance Director City Attorney
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ATTACHMENTS: 1. Maintenance of Effort (MOE) for Fiscal Year 2021-22
2. M2 Seven-Year Capital Improvement Program (CIP)
3. Resolution No. 2021-xx