This week, Supervisor Don Knabe delivered his annual State of the Marina speech to a group of business leaders, community leaders, and residents in Marina del Rey. His comments this year focused on the status of several redevelopment projects in the Marina, as well as County infrastructure projects, and the local impacts the recession is having on the Marina and the Department of Beaches and Harbors. The full text of the Supervisor’s State of the Marina speech can be found at the link below.

STATE OF THE MARINA 2010

Thanks for the invitation – always great to be here. Thanks to the LAX Coastal Area Chamber of Commerce for giving me the opportunity to update the Chamber on what’s going on in the Marina.

My comments today will focus primarily on the State of Marina del Rey, but first I want to talk big-picture about the health of the County’s budget. We all know that Los Angeles County is simply the largest municipal government in the United States, in every single category from healthcare to public safety to every type of service. Because we are the largest, the current recession means that Los Angeles County is facing shortfalls at a staggering level.

Our current year revenues are lower than we anticipated and included in our budget this year by about $200 million at this point in the year. This is caused by lower sales tax receipts and lower property tax receipts. As with all levels of government, the tax base the county counts on to pay for everything we do expands and contracts with the economy.

Unfortunately, we are in a contraction period and our estimated shortfall for next year is in the realm of $700 million. Here’s the good news: as I’ve said many times before, Los Angeles County is weathering the storm from a far better position than many other levels of government.

The County ended the last fiscal year with a small budget surplus, most of which we rolled over into rainy day funds and savings for this current year. Our surplus was not much, but it was enough to ensure that, as of today, we have not laid-off any permanent County employees, we have not had widespread cuts of service programs, we have not had furloughs, and we’ve been able to maintain critical programs like capital projects, public safety, and health care programs.

Having said that, with a looming shortfall in the $700 million range everything will be on the table with the exception off layoffs which will be an absolute last resort for the Board. Our local economy can not take any more unemployment at this point. Besides streamlining costs, perhaps more importantly, in October, every single one of our union partners agreed to a two-year extension of current contracts with no pay increases or cost of living increases.

That’s almost 90,000 of our 101,000 County employees, spread across 58 different unions and bargaining units. Our end of the year budget stands at approximately $23.1 billion, which represents an approximately six percent reduction over last year. As part of closing next year’s shortfall, we are looking at 9% across the board curtailments to departments. On top of the reductions to date this would bring our across the board reductions to around 16%. We reduced vacant positions to save even more money and drop our employment roll by several thousand positions.

We have a hard hiring freeze except in critical areas like health and public safety. Perhaps our biggest area of savings has been through budget reductions within the various departments. These reductions have ranged all the way from just a few percentage points to nearly 20 percent cost savings in individual departments, which has saved us over $193 million in taxpayer money, all without widespread reductions in services or jobs.

Now, Los Angeles County has done a substantial amount of belt-tightening and we are going to weather this storm as best we can, but there are many more hits expected to come in the form of more cuts from the State.

In the past year, when all was said and done with cuts from the State, the County had a $267.7 million estimated loss due to funding reductions in health, public health, mental health, social services, and justice and general government programs.

With the state again facing a monstrous shortfall for 2010-2011, I am sure they will be looking to pass on some of their money problems to local government. We will continue the good fight to ensure we protect our public services locally.

We could have faced an additional loss of $360.9 million due to suspension of Proposition 1A, but we were able to securitize these funds by selling local bonds. The state of the state is still dire, as Governor Schwarzenegger reminded Californians during his annual speech late last month. Many of the State’s budget cuts and other maneuvers tried last year either have been reversed in court, such as some furloughs of state workers, or are stuck there, such as the plan to sell part of the State Compensation Insurance Fund.

While the Governor outlined an ambitious agenda to address the state’s fiscal crisis, it failed to include the structural reforms necessary to reform the state’s broken budget process. California’s credit rating is the lowest among the states, in part because of the chronic revenue/ spending gap and in part because the requirements of a supermajority vote on the budget.

To retain business, create jobs and spur economic growth, California should tear a page from Nevada’s successful playbook and make overtures to business to stay or relocate to California with business-friendly incentives including reducing taxes, regulation and an innovative marketing campaign.

The Governor and the Legislature are going to have to balance that budget on the backs of local government again, and we are still crunching the numbers to see how bad it will be for the County. But in the meantime, for the state of the state to move from dire to hopeful, the governor and lawmakers need to agree on a budget that, for once, does not push our fiscal problems into the future.

I fully recognize though that there is an even rougher road ahead, and the County will be ready. I want to begin my Marina-specific comments, by mentioning the loss of three important individuals to the Marina community in the past year.

October 2009 – Stan Wisniewski, Director of the Department of Beaches and Harbors for close to 15 years and a County employee for over 40 years.

November 2009 – Doug Ring, a Marina lessee.

January 2010 – Harley Searcy, a Small Craft Harbor Commissioner from 1998 through 2008, serving as the Chair from 2001 until he resigned.

When I was last with you just about one year ago, we had just marked the appointment of Santos H. Kreimann to the position of Director of the Department of Beaches and Harbors. He just recently passed his one year anniversary and is still alive to talk about it.

Also, about six months ago, we hired Gary Jones, the new Deputy Director overseeing the Asset Management and Planning Bureau. 29 different projects going on. 11 projects completed. In 2009, the Admiralty Apartments were completed, as was the exterior refurbishment of the Marina Towers. 2 other projects are currently under construction.

Parcel 1 (Fuel Dock) – the complete replacement of the docks, a new fuel delivery system with high-speed pumps, four types of fuel, an automatic payment system, and state of the art fuel spill containment system.

Parcel 27 (Jamaica Bay Inn) – the renovation of the existing hotel and the addition of 69 rooms. 2 other projects are waiting only for building permits.

Parcel 15 (Esprit II, formerly Bar Harbor) – 585 new apartments, including 47 very low-income senior housing units, and a new 225-slip marina. Due to delays, an amendment extending the time for construction completion was required in exchange for: a $1 million fee; an increase of approximately $215,000 in annual minimum rent; termination of the abatement of minimum rent during construction; termination of percentage rent deferral; elimination of the possible earnback of up to 50% of the extension fee.

The second project waiting for a permit is Parcels 100/101 (Del Rey Shores) – 544 new units with 37 moderate income and 17 very low income on-site affordable housing units. Also, we have 14 other projects in various stages.

In 2009, the Board approved the environmental documentation for Parcel 8 (Bay Club Apartments and Marina) lease extension and renovation of 205 apartment units and complete redevelopment of 207 slips and 11 end ties.

The Board approved an extension of time for the proposed Parcels 52/GG (Boat Central) lessee to secure required entitlements to develop a dry stack vertical boat storage facility that will accommodate between 346 and 367 boats and 28 boat trailers and an outside storage area for 30 mast-up sailboats.

Also, the Design Control Board conceptually approved the renovation plans of the Marina International Hotel (Parcel 145). Finally, the Regional Planning Commission considered the following projects: The proposed Oceana Retirement Facility immediately adjacent to the Oxford Basin, Redevelopment of Holiday Harbor, the proposed Woodfin Hotel and passive wetland park at Parcel 9U (the only undeveloped property in the Marina), and the redevelopment of the Neptune Marina property, as well as an underutilized parking lot.

You may recall that I introduced a motion on September 1, 2009 with a three-pronged roadmap with respect to the Marina LCP, which was fully endorsed by the California Coastal Commission: A response to the Periodic Review of the Marina del Rey Local Coastal Program by the California Coastal Commission is due in April 2010 and is being developed by the Regional Planning Department, in consultation with County Counsel, the Departments of Beaches and Harbors and Public Works, and any other County department with responsibilities in Marina del Rey.

Public work groups were formed and presented their input to the Department of Regional Planning with respect to preparation of the County’s response to the LCP Periodic Review. The County’s proposed response is now being presented at various public hearings.

It was presented at the Small Craft Harbor Commission last Wednesday, February 10, and will be presented to the Design Control Board at a special night meeting to be held tonight at 6:30 p.m. The Regional Planning Commission and Board of Supervisors will also hold public meetings in the future with respect to the proposed responses, as they both must approve the responses before they are submitted to the California Coastal Commission.

Previously, the Board formally adopted LCP amendments that addressed the roles and responsibilities of the Design Control Board and the Regional Planning Commission, eliminating duplication of roles and allowing for concurrent filing of redevelopment project applications. We have a number of public works and infrastructure projects going on behind the scenes that I’d like to briefly update you on.

City of Los Angeles Venice Pumping Plant Dual Force Main Project – the Board has recently approved the filing of a writ against the City of Los Angeles in connection with its approval of the construction of the sewer main underneath Via Marina instead of the originally-identified preferred Pacific Avenue alternative.

Traffic Improvement Projects – the Board recently approved transfer of $1.5 million in Costco mitigation funds for use on projects on Admiralty Way from Fiji Way to the Via Marina intersection.

Marina Waterline Replacement Project – the Board approved a transfer of $1.5 million from the Marina Accumulative Capital Outlay Fund (ACO) Fund to finance a portion of the construction costs of the Marina waterline replacement project, which consists of installing nearly 20,000 linear feet or approximately 3.8 miles of 18-inch diameter steel pipeline along Fiji Way, Admiralty Way, Via Marina and Bora Bora Way to replace the 10-inch and 14-inch diameter water mains that exist but are undersized to meet current domestic and fire protective demands. The first phase of slightly less than half the length is expected to start construction activities in April 2010, with the second phase expected to start construction approximately one year later.

Speaking of water, the Board was forced to adjust the water rate for Marina del Rey for calendar 2010 to pass through water rate increases from the wholesale water agency serving the Marina del Rey Water System.

Also in 2009, the Board declared a water shortage emergency exists and authorized implementation of the County’s Phased Water Conservation Plan, requiring a 15% reduction in water use in Marina del Rey.

We approved an agreement with Hornblower Yachts, Inc. to operate the Marina’s WaterBus service for an extended period at seven boarding locations, which served a record-breaking 40,000 riders in slightly over ten weeks this past summer.

Oxford Retention Basin Flood Protection Multiuse Enhancement Project – The County’s Department of Public Works has developed four concept alternatives and pictorial renderings for the basin design, which is to include a passive recreation component.

Ballona Creek Trail and Bike Path Project – we approved a 20-year agreement for recreational purposes between the County’s Flood Control District and the Mountains Recreation and Conservancy Authority to construct and maintain interpretive and directional signs, decorative gates, fences, native plant landscaping, seating, drinking fountains, bike racks, and community bulletin boards.

Public Boat Launch Facility Improvement Project – we submitted a $4.6 million grant application to the State Department of Boating and Waterways for the Marina del Rey public boat launch facility, which will replace the boarding floats and guide piles; add a staging dock with guide piles; add an 80-foot Americans With Disabilities Act (ADA) accessible gangway; widen the entrance driveway; and various other miscellaneous improvements.

The Board has been forced to adopt budget curtailments throughout all County Departments and the Department of Beaches and Harbors suffered a 15.3% reduction in 2009-10. This does not include reduction of the annual County contribution to the Marina’s Accumulative Capital Outlay Fund from $3 million to $1 million. DBH will be facing a minimum 22% curtailment in 2010-11. I introduced a motion in 2009 that allocates revenue that is generated from Department fee increases and new fees to go specifically to the Department of Beaches and Harbors as opposed to the County’s General Fund.

I also sought to preserve the Department’s sponsorship revenue and the people’s right to choose what they eat and drink through a motion that exempted recreational, entertainment and cultural venues from a 100% healthy food requirement in County vending machines within County facilities and, potentially, a healthy foods standard at County-sponsored events.