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BILL # DS'~o31-
AGENDA BILL
CITY OF BREMERTON
CITY COUNCIL
1-19-05
DATE SUBMITTED:
1-26-05
2-2-05
Financial Services
Laura Lyon
473-5722
Committee Meeting Date
COUNCIL MEETING Date
SUBJECT: Resolution authorizing transfer
of$150,000 from the General Fund to the
Abatement Revolving Fund
Department:
Presenter
Phone
R-eso/IA,^iM
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SUMMARY: The Abatement Revolving Fund has previously undertaken a line of credit to finance costs
associated with abatement of unfit dwellings, buildings, structures, and premises. The current line of credit
expires on January 31, 2005 and the principal plus accrued interest thereon (total of $223,448.28) is due at that
time. The costs currently financed with this line of credit relate to the Sesko Properties Nuisance Abatement
claim which is scheduled to go to court on January 21,2005. This claim will not be resolved in sufficient time
to provide funds for repayment of the debt obligation per the terms of the loan agreement. The Sesko claim
amount is $313,389.09 (including attorney fees). The exact amount allowed and the final payment of said
claim cannot be determined at this time. A transfer of $150,000 to the Abatement Revolving Fund from the
General Fund is sufficient (in combination with current funds on hand in the Abatement Revolving Fund) to
provide for the payment of the debt obligation plus provide sufficient ongoing working capital for the
Abatement Fund. Although the 2005 Budget Documents contemplated a new line of credit being obtained, it
is the opinion of the Director of Financial Services that these costs are not good candidates for debt financing
given the uncertainty of collection expectations on these types of claims - both in timing and in amount. A
transfer from the General Fund of$150,000 to the Abatement Revolving Fund is therefore proposed with all
future rights and claims to the Sesko Abatement similarly transferred to the General Fund in consideration of
the transfer being made.
lJo
A TT ACHMENTS: Proposed Resolution
FISCAL IMPACTS (Include Budgeted Amount): Immediate impact is $150,000 expenditure from the
General Fund that was not contemplated in the 2005 Budget as adopted. The preliminary unaudited ending
fund balance for the General Fund as of December 31, 2004 (which becomes the beginning fund balance for
the 2005 year) is higher than the 2004 budget OJ: 2005 budget contemplated. There is sufficient capacity to
accommodate this proposed increased expenditure. The 2005 Budget will require amendment to incorporate
this, which will be done at a later date in combination with other required budget adjustments
APPROVALS
CONSENT AGENDA D
CITY ATTORNEY:
FINANCE DIRECTOR:
MAYOR:
FISCAL/BUDGET
OPERATIONS:
COUNCIL PRESIDENT
D No Action
RECOMMENDED MOTION: Move to pass Resolution # ..t15J-authorizing the transfer of
$150,000 from the General?d to the Abatement Revolving Fund.
COUNCIL ACTION: [2( Approve D D
Continue
Table
D Deny