The city of Berkeley expects to spend more than $20 million in the next year on a range of ambitious infrastructure projects funded by Measure T1, a $100 million bond that won landslide support from voters in 2016.
But a funding gap and challenges related to environmental sustainability are serious concerns, staff told Berkeley City Council members during a worksession Thursday. The afternoon meeting included an update on the city’s progress with its sustainability plans as well as its strategic plan.
Parks Director Scott Ferris told council members there’s a $5.4 million “potential” funding gap for the first round of T1 projects due to increasing construction costs, less money from bond sales than expected, a $2 million allocation to the city’s mental health building and other financial changes. Ferris said the city could postpone or remove projects from the queue, find additional money somewhere else, or spend less money on green elements to cut costs.
Ferris said staff will seek recommendations from the city’s T1 subcommittee and come back to council in May with those ideas.
Staff learned of the budget shortfall in October and met with multiple commissions once the issue “had become very apparent,” Ferris told council. The groups began to score various projects and aims to come up with a prioritized list by March.
“Our projects are coming in so much higher than we thought they would,” he said, adding that several projects are currently out for bids or coming back in early 2019. “We’ll know a lot more in the next 3-4 months where we are and how much money we have.”
Measure T1 currently includes a list of 34 projects, and staff provided updates to council on several of them: the rose garden, San Pablo Park, the North Berkeley Senior Center, Adeline Street and three streets at the marina: University Avenue, Marina Boulevard and Spinnaker Way.
Ferris said oversight is a big part of the T1 program, with plans for six audits over the 12-year life of the bonds. The first audit will be coming up soon, he said. Staff also updates multiple commissions on an annual basis, and meets with the T1 subcommittee “pretty regularly,” he said.
Next year the city will determine how to allocate the second phase of the bond money.
Margo Schueler, T1 subcommittee chair, told council the city must prioritize sustainable building features despite the financial costs.
“It is a climate emergency,” she said. “Everything we move forward with now has to have that lens.”
Ray Yep, from the Public Works Commission and the T1 subcommittee, said there had been talk of making the T1 process a “model program” as far as how it had approached outreach, public input, performance goals, oversight and more. He said the T1 committee had been having “productive discussions” with staff, despite some early stumbles, and said the team had finally gelled.
“Like good, fine wine, it takes time to prepare,” he told council. “And I think we’re there.”
Council members said they were excited about a public restroom audit that’s coming up, and urged staff to keep sustainability top of mind going forward. Councilwoman Susan Wengraf said plans at the rose garden appear to be moving in the right direction.
“This is an iconic park for the city of Berkeley, extremely well used,” she told staff. “Everybody is very excited about the work you’re doing and the quality of work that’s being done.”
Wengraf said she’s worried the funding shortfall projected by staff, however, may not be high enough. She asked for “a really big contingency” across all the project costs to ensure there’s room to cover any surprises and changes in the industry.
“We know construction costs are going up,” she said. “And that’s not something that we can control.”
Mayor Jesse Arreguín asked staff to think about coming up with a “plan A” and a “plan B” that consider different levels of “assumed escalation” in construction costs.
And Councilwoman Sophie Hahn said it would be important for Berkeley to prioritize the project list so the city doesn’t run out of money for significant work before it’s done.
Hahn also asked about the possibility of building affordable housing on top of the North Berkeley Senior Center. Staff said the building could only take one additional floor due to structural issues. Wengraf added that the BART tunnel runs beneath the building.
Arreguín told Hahn that the West Berkeley senior center, at 1900 Sixth St., would be the “more appropriate location” for affordable housing. He said he plans to come forward soon with a request for proposals for potential housing there and hopes to “move quickly with affordable housing” on that site.
City Manager Dee Williams-Ridley asked officials to remember that they are on a timeline required by the bond language: 85% of the bond spending must occur within three years, and 100% within five.
“Whatever we delay or move forward,” she said, “we have to keep those spending guidelines in mind.”
Council Members Ben Bartlett, Linda Maio and Kriss Worthington were absent from the meeting. Maio and Worthington retired last week.