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September 9, 2025
ITEM TITLE
Interfund Loan & CIP: Authorize an Interfund Loan from Measure A Fund to the Public Facility Development Impact Fee Fund and the General Fund and Amend the FY 2 025-26 CIP Budget Appropriating Additional Funds to the Fire Station 12 Project (GGV0275)
Report Number: 25-0200
Location: 610 Bay Boulevard
Department: Engineering & Fire
G.C. § 84308 Regulations Apply: Yes
Environmental Notice : The Project qualifies for a Categorical Exemption pursuant to the California Environmental Quality Act State Guidelines Section 15303 class 3 (New Construction or Conversion of Small Structures) and Section 15332 Class 32 (In-Fill Development Projects).
Recommended Action
Adopt a resolution: 1) Authorizing an interfund loan in the amount of $ 5,600,000 from the available fund balance of the Measure A Sales Tax Fund to the Public Facility Development Impact Fee Fund (PFDIF Fund) and the General Fund CIP Fund ; and 2) Amending the fiscal year 2025-26 Capital Improvement Program (CIP) Budget by appropriating $5,600,000 in the PFDIF Fund and General Fund CIP Fund for the Temporary Fire Station 12 Project (GGV0275). (4/5 Vote Required)
SUMMARY
Following the award of the Design Build contract for this project in September 2024, the design of the project was developed in coordination with the Fire Department. As the design progressed, the operational needs for the facility and specific site constraints became more clearly defined. Several factors contributed to an increase in the projected cost, including refined cost estimates, increased scope to accommodate essential programmatic needs, and challenges related to the site. Now that the design is complete, the total anticipated project cost exceeds the original budget appropriated at the time of contract award, therefore, additional funding is required to complete the project.
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Adoption of this resolution amends the Fiscal Year 2025-26 Capital Improvement Program (CIP) Budget and authorizes an interfund loan in the amount of $ 5,600,000 to cover the projected costs to complete the Temporary Fire Station 12 Project (GGV0275).
ENVIRONMENTAL REVIEW
The Director of Development Services has reviewed the proposed project for compliance with the California Environmental Quality Act (CEQA) and has determined that the project qualifies for a Categorical Exemption pursuant to State CEQA Guidelines Section 15303 Class 3 (New Construction or Conversion of Small Structures) and Section 15332 Class 32 (In-Fill Development Projects) because the proposed project would not result in a significant effect on the environment, create a cumulative impact, damage a scenic highway, or cause a substantial adverse change in the significance of a historical resource. Thus, no further environmental review is required.
BOARD/COMMISSION/COMMITTEE RECOMMENDATION
On August 26, 2025 the Measure A Citizens’ Oversight Committee was provided notice of the proposed interfund loan from Measure A to the PFDIF Fund and the General Fund CIP Fund in order to build temporary Fire Station 12 and confirmed no fiscal impact to the Measure A fund.
DISCUSSION
The Gaylord Pacific Resort & Convention Center located in the Chula Vista Bayfront development was opened in May 2025 and other portions of the development are underway. The development in the Bayfront area has and will continue to significantly increase calls for service (“CFS”) to the Fire Department. The requirement of fire services detailed in the d evelopment agreement and the Fire Facilities Master Plan (FFMP) establishes the need for an additional fire station, FS12, at or near Bay Blvd and J Street. This need is also directly supported by the FFMP Amendment and the Determination of Proportional Sh are for the Bayfront Fire Station Study. Within the FFMP, the addition of the Bayfront Fire Station is referenced in several areas; however, the focus revolves around the increased growth in call volume and development impacts within the City.
The Bayfront is adjacent to several existing and occupied neighborhoods, making up west Chula Vista. With the new development and without the increase to fire service capability, additional CFS caused by population growth will have a negative impact on Fire Department response threshold standards. In addition to the population growth, which directly coincides with CFS increases, the high-rise type of development requires additional personnel and equipment to properly mitigate life safety risks. The currently existing fire stations and response companies do not have additional service capacity. The effects will progressively worsen as development approaches build out, and normal service demand continues to increase. FS12 is necessary for the City to provide fire, rescue, and emergency medical services for this new population growth and the associated risks involved with the development type.
Discussion of the Fire Station Network, response performance metrics, Bayfront service demand, station scope, and the program supporting the need for Temporary Fire Station 12 can be found in City Council Staff Report Number 24 -0246 from September 17, 2024 title d “Agreement: Award Progressive Design -Build Agreement with Erickson Hall Construction Company for the Temporary Fire Station 12 Project (GGV0275), Amend the Fiscal Year 2024-25 CIP, Establish a New CIP Project, and Appropriate Funds.” P a g e | 3
Following the award of the Design Build contract in September 2024, the design of the project was developed, and the Fire Department’s requirements for this facility and the site constraints became clearer. Since this temporary station is expected to be in service for many years, the minimum features required of a permanent station were necessary for the operation of the station. As a result, the size and the features required for the station to adequately serve the needs of the Chula Vista Bayfront development exceeded preliminary project estimates.
Preliminary plans identified the fire station located near the intersection of Bay Blvd and J Street. A site study conducted by the project architect concluded that the temporary station and the permanent station would not fit on the Bay Blvd and J Street site. Due to these site constraints, an alternate location was selected for the temporary station at 610 Bay Boulevard. The Bay Blvd and J Street parcel is still planned as the location for the permanent station. This increased the project cost because the use of 610 Bay Boulevard required the demolition of an existing abandoned building, additional coordination for work around utility easements, and addressing soil conditions on the site.
The design is now complete, and the project was bid to subcontractors by the Design Builder. The Design Builder and staff are working to review bids and finalize the Guaranteed Maximum Price (GMP). The projected cost exceeds the project funds, and an additional $5,600,000 is required to complete the project.
Staff recommends authorizing an interfund loan totaling $ 5,600,000 from available fund balance of the Measure A Sales Tax Fund to the PFDIF Fund and General Fund CIP Fund and amending the Fiscal Year 2025- 26 CIP Budget by appropriating $5,600,000 to the PFDIF Fund and General Fund CIP Fund to cover the projected costs to complete the Temporary Fire Station 12 Project (GGV0275).
DECISION-MAKER CONFLICT
Staff has reviewed the property holdings of the City Council members and has found no property holdings within 1000 feet of the boundaries of the property which is the subject of this action. Consequently, this item does not present a disqualifying real property -related financial conflict of interest under California Code of Regulations Title 2, section 18702.2(a)(7) or (8), for purposes of the Political Reform Act (Cal. Gov’t Code §87100, et seq.).
Staff is not in dependently aware and has not been informed by any City Council member of any other fact that may constitute a basis for a decision maker conflict of interest in this matter.
CURRENT-YEAR FISCAL IMPACT
Approval of the resolution approves an interfund loan totaling $5,600,000 from available fund balance of the Measure A Sales Tax Fund to the PFDIF Fund and General Fund CIP Fund and amends the Fiscal Year 2025- 26 CIP Budget by appropriating $ 5,600,000 to the PFDIF Fund and General Fund CIP Fund to cover the projected costs to complete Temporary Fire Station 12 Project (GGV0275).
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A summary of expected project costs for the Temporary Fire Station 12 Project (GGV0275) is as follows:
FUNDS REQUIRED FOR CONSTRUCTION
A. Estimated Contract Amount $ 13,819,896.16
B. Contract Contingency (Approx. 3.5%) 511,336.16 C. FF&E, Permit Fees, Utility Fees, Etc. 69,099.48 C. Construction Support (Approx. 3%) 479,668.20 D. Project Closeout (Approx. 0.4%) 50,000.00
TOTAL FUNDS REQUIRED FOR CONSTRUCTION $ 14,930,000.00
A total of $1 4,930,000 is required for the construction of temporary Fire Station 12. Currently there are appropriations of $6,866,880 in the PFDIF Fund (Fund 560) and $2,463,120 in the General Fund CIP Fund (Fund 713) respectively. This action is seeking an additional $ 5,600,000 to be funded by an interfund loan from the available fund balance of the Measure A Sales Tax Fund (Fund 222) between the PFDIF Fund and the General Fund CIP Fund. Appropriations for Temporary Fire Station 12 Project (GGV0275) are summarized by fund in the table below.
Fund
Original
Budget
Interfund
Loan
Amended
Budget
PFDIF – Fire Suppression Component (GGV0275) $ 6,866,880 $ 4,121,600 $ 10,988,480 General Fund CIP Fund (GGV0275) 2,463,120 1,478,400 3,941,520 Measure A Sales Tax Fund - Interfund Loan (fund balance) (5,600,000) TOTAL FUNDS AVAILABLE FOR CONSTRUCTION $9,330,000 $ 0 $14,930,000
The interfund loan repayment will be split between the PFDIF Fund (73.6%) and the General Fund CIP Fund (26.4%) as presented in the table above. The PFDIF Fund is projected to have sufficient funds on hand within 10 years and the General Fund CIP Fund is projected to have sufficient funds on hand within five years to repay the proposed interfund loan from the Measure A Sales Tax Fund. The availability of PFDIF funds is dependent on the rate of development. Should funds become available sooner, the interfund loans would be retired earlier. Interfund loan monies will be advanced on a quarterly basis from the Measure A Sales Tax Fund to minimize borrowing costs. Staff has analyzed the Measure A Sales Tax Fund’s assets and planned expenditures and determine d that authorizing the proposed interfund loans totaling $ 5,600,000 will not impact service delivery or planned capital projects. The Measure A Sales Tax Fund will earn interest on monies loaned based on the City’s pooled interest rate, ensuring no City fund is penalized or profits from participating in an interfund loan
ONGOING FISCAL IMPACT
Temporary Fire Station 12 is a critical component of the Chula Vista Bayfront Master Plan and will incur ongoing operations and maintenance costs essential for its continued service to the community. These costs, covering staffing, equipment upkeep, utilities, and facility maintenance, align with the vision of the City’s Long-Term Financial Plan and will be included in the annual budget development process.
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The new temporary station is expected to be staffed with one engine company in fiscal year 2025 -26, and a truck company in fiscal year 2026 -27. The estimated operating cost is $2.2 million for fiscal year 2025 -26, and $4.4 million for fiscal year 2026-27.
The interf und loan repayment terms will be evaluated, monitored and appropriated in future quarterly monitoring reports and during the budget development process through the life of the interfund loan.
ATTACHMENTS
1. Project Title Sheet
Staff Contact: Harry Muns, Fire Chief, Fire Department Matthew Little, Deputy City Manager/Director of Engineering & Capital Projects Jonathan Salsman, Principal Civil Engineer, Engineering & Capital Projects