Item No.
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: OFFICE OF THE CITY MANAGER
BY: ROGER BRADLEY, CITY MANAGER
DATE: JANUARY 28, 2025
SUBJECT: DISCUSSION REGARDING PROVIDING ADDITIONAL FUNDING FOR THE
NEW DOWNEY YMCA FACILITY
EXECUTIVE SUMMARY
The City Council will discuss providing additional funding to the new YMCA facility at 11531 Downey Avenue.
RECOMMENDATION
That the City Council:
1.Discuss funding, including any potential City assistance, of the new YMCA facility at 11531 Downey Avenue; and
2.Approve an additional fee waiver of $66,070 for City fees and associated costs for the YMCA of Metropolitan Los Angeles to facilitate the construction of a new YMCA facility at 11531 Downey Avenue.
BACKGROUND
The planned brand-new Kolar Family YMCA 20,000 square foot building is being designed to include: an outdoor basketball court; pickleball courts; a child activity center; indoor pool; men’s, women’s, and family locker rooms; state-of-the-art fitness center; holistic health community space; dedicated parking with electric vehicle charging stations; and a secured entrance. The building will also be ADA compliant and will be designed to provide an inclusive environment that is welcoming to all. Programming at the new facility will include youth and teen development programs, before and after school care, and senior and special needs activities.
The construction of the new building is anticipated to be completed by September 2026.
Grant Management
As part of the State of California 2022-2023 budget, the California State Library appropriated a one-time local assistance grant for the new Downey Family YMCA in the amount of $3,000,000 through Assemblymember Cristina Garcia. Local assistance grants
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2 must be managed by a local government agency, and as such, the California State Budget named the City of Downey as the awardee of the grant funds on behalf of the YMCA.
On April 11, 2023, the City Council approved a grant agreement between the City of Downey and the YMCA of Metropolitan Los Angeles (YMCA) to outline the roles and responsibilities of each party while also offering a high-level overview of the expectations in relation to the project.
City staff has been working closely with the YMCA project team to complete necessary grant reports, and to discuss project timelines and designs to ensure the project meets necessary grant timelines and to proactively address any potential issues in order to avoid project delays. It should be noted that City staff is not charging their time, “Administrative Costs”, to the California State Library grant for the management of the grant as is normally done with such projects. This enables more of the $3,000,000 funds to be used towards the actual project.
The State Library grant funding will assist with the following items associated with development of the new YMCA facility:
•demolition and site preparation;
•parking site I construction;
•site utilities, and
•conceptual and construction design drawings.
Waiver of City Fees
At the November 14, 2023 meeting, the City Council approved the waiver of $296,081 in City fees (and reduction in City revenues) to facilitate the development of a new YMCA facility at 11531 Downey Avenue and directed staff to draft a Development Agreement with YMCA to memorialize the waived fees and YMCA project development timeline. This agreement has been fully executed by both parties.
YMCA Project Funding
At the February 28, 2023 City Council meeting, the City Council discussed funding of the YMCA Capital Campaign Project. At this meeting, the City Council received a presentation from YMCA representatives regarding the Downey YMCA history, programming, and the new proposed building. After deliberation by the City Council, it was decided to evaluate possible funding during the budget process.
During the Fiscal Year (FY) 2024-2025 Budget Workshop on May 20, 2024, it was determined that the City will pledge a $1 million donation to the YMCA if monies are available. The funding would be provided over the course of three (3) years, with the City allocating $333,000 each year if monies are available.
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3 Current YMCA Funding Status
The new YMCA building project is estimated to cost approximately $22,000,000. The YMCA has secured about $19,500,000 for the project, with a combination of community donations, the aforementioned State Grant, a recent donation of $2 million from LA County Supervisor Janice Hahn, a $1 million pledge from the City of Downey, and $850,000 through the federal 2024 Community Project Funding program from Congressman Robert Garcia. It should be noted that the Congressman originally submitted $3 million during the 2024 Community Project Grant process, but the final appropriated amount was $850,000.
Additionally, included in the $19,500,000 raised so far is a $5 million tax credit opportunity that the YMCA is seeking to leverage. However, this opportunity requires the YMCA to close the remaining funding gap of $1.5 million by the end of January 2025.
ANALYSIS
At the January 14, 2025 City Council meeting, the City Council asked staff to return at the next City Council meeting with an agenda item to discuss additional funding of the new YMCA facility at 11531 Downey Avenue.
Current City Financial Considerations
For the FY 2024-2025 budget cycle, the City appropriated $333,00 to the YMCA project by reducing funding from the City’s Special Revenue Fund, Fund 40 – City Hall Improvement Project, which is intended to enhance security and modernize staff workplaces in City Hall.
City staff is continuing to identify monies for the remaining 2 tranches of $333,000 as it requires reallocating funding from City services and programs to the YMCA project.
Monies in the General Fund have already been assigned to City services and programs.
Therefore, requests for funding from the operating budget to the YMCA project would require offsetting reductions in funding for City services and programs. It should also be noted that funds listed under Special Revenue Funds, including Measure S and Enterprise Funds, are restricted and can not be used for funding for the YMCA project.
Should the Council wish to proceed with an additional allocation of funding, it would be likely that such funding would need to come from a reserve allocation. However, allocating monies from reserves could have long-term implications as there are large City legacy projects that are in need of funding as well, including the City’s 3 percent contribution to the Southeast Gateway Line Transit Project, which is estimated to be over $6 million, the implementation of the City’s new Enterprise Resource Planning system, and any potential future economic development incentive programs.
Separately, the City has also begun its own Capital Campaign regarding the Columbia Memorial Space Center. Phase 1 of the Capital Campaign includes the construction of the 2nd Building of the Columbia Memorial Space Center and the restoration of the space shuttle mockup Inspiration. A total of $32 million is needed for Phase 1, and while the City
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and the Space Center Foundation has made great strides in fundraising, the City needs to secure a remaining amount of $8 million to complete Phase 1. Monies that the City has raised to date include funding from state and federal grants that requires funding to be expended by March 2027.
Waiver of City Fees
As previously mentioned, the City Council approved the waiver of $296,081 in City fees (and reduction in City revenues) to facilitate the development of a new YMCA facility at 11531 Downey Avenue. Limited information was provided when developing original fee waiver estimate; however, staff recently ran the actual fee with the actual final plans submitted, and the total fee waiver needed is $362,150.88.
Staff is requested that the City Council approve an additional fee waiver (and reduction in City revenues) in the amount of $66,070 to facilitate the development of a new YMCA facility at 11531 Downey Avenue.
CITY COUNCIL PRIORITIES
Fiscal Responsibility
Quality of Life, Safety & Infrastructure
FISCAL IMPACT
The fiscal impact will depend on the outcome of the City Council discussion.