May 26, 2010: Santa Clara's 2010-2011 Capital Improvement Budget Fares Better Than Operations Budget

By Carolyn Schuk

Santa Clara's capital improvement budget (CIP) for the coming fiscal year is better news than the city's operating budget. That's because capital investments – a community's physical infrastructure, such as sewers, buildings, and parks – are funded in different ways than its day-to-day operating expenses – for example, heating and staffing those buildings.

While maintenance and improvements in Santa Clara's "enterprise" departments – departments that collect revenue, such as the city's municipal electric utility – fund much of their capital investment with revenue, major capital investments are largely funded by Redevelopment Agency (RDA) bonds, federal grants, and state, county and regional taxes and grants.

But these funds aren't interchangeable. Federal Housing and Urban Development grants for affordable housing programs can't be used to pay police officers. And bonds that are sold to build libraries can't be used to build a road instead.

In the coming fiscal year, Santa Clara will spend about $77,000,000 on new capital projects. The top three sources of funding for these projects are: RDA bonds, the American Recovery and Reinvestment Act (ARRA, the federal economic stimulus program), and RDA property taxes. None of the money comes from the City's operating fund.

City officials have been working hard to bring ARRA grants to the City, according to Santa Clara Director of Public Works Rajeev Batra, and have been successful in bringing the City about $18 million so far in federal stimulus funds for "shovel-ready" projects. 

Of roughly $77 million that the City will spend on capital improvements next year, the 3 top funding sources are
RDA bonds, the ARRA federal economic stimulus program,
and RDA property taxes.

Santa Clara 2010-2011 Capital Improvement Projects

The city has eight significant projects on the drawing board for the coming fiscal year. Here's the list, showing the budget amount and where it's coming from.

•  New Tasman Ave. parking structure: about $42 million; funded by RDA bonds
• The new Northside branch library: roughly $20 million, funded by RDA bonds and tax income. 
• A new sewer main on Walsh Ave: $8 million, funded by RDA bonds. 
• A 40 percent expansion of Santa Clara's recycled water system: $10.1 million funded by (ARRA, federal stimulus program). 
• South-of-Forest streets resurfacing: $1.3 million, funded by Prop 42 traffic congestion relief funds and gas taxes. 
• San Tomas Aquino Trail Extension: $767,000, funded principally by county and regional grants, with about 25 percent coming from the City. 
• Public facilities lighting retrofits and energy efficiency programs: $1.2 million funded by ARRA.  
• Affordable housing, community development, public service and energy conservation programs: about $12 million funded by grants from the US Dept. of Housing and Urban Development (HUD) and RDA tax income. 

For more information visit the Santa Clara City website.