Rancho Palos Verdes City Council



DATE: MAY 20, 2003



  1. Place the Alta Mira Canyon Channel project on hold.
  2. Authorize staff to request a proposal from GeoSyntec Consultants for a ground water investigation in the Abalone Cove project area.
  3. Establish a new joint project with the Abalone Cove Landslide Abatement District to develop three dewatering wells in the Abalone Cove project area.
  4. Award an engineering contract to John Cruickshank Inc., in the amount of $6,400, for preliminary engineering services for the design of an elevator at City Hall, and authorize the Mayor and City Clerk to execute the contract.
  5. Request staff to investigate the potential sale of excess Community Development Block Grant Funds.


The Community Development Block Grant (CDBG) Program is a federally funded, County administered grant program under which the City receives annual funding for eligible projects of the city’s choosing. The program guidelines are rigid, and the eligibility requirements are difficult to meet. A flowchart and other exhibits outlining the eligibility requirements are attached.

Historically the City has used its CDBG funds to administer the Reach Program, provide loans and grants to residents meeting income guidelines under the Home Improvement Program, remove access barriers at the city’s buildings and parks, and in FY 1997 – 98 funds were used to construct roadway improvements along Palos Verdes Drive South within the landslide area.

Alta Mira Canyon Project

Since 1997 the City has allocated funds toward a project to construct improvements along the Alta Mira Canyon Channel. The panel of geologic experts recommended this project to reduce the amount of canyon flow entering the Abalone Cove landslide. Through 2002, a total of $ 925,000 in CDBG funds had been set aside for this project. In May of 2002 staff reported that the current estimate of costs for; the acquisition of rights of way, legal fees, construction costs, and engineering / construction manage costs is $1.25 million, or $325,000 greater than available block grant funding. Due to this shortfall, the City Council requested staff to consult with the Abalone Cove Landslide Abatement District and our geotechnical consultants to determine if the project could be redesigned with lower costs and still meet the project objectives.

Elevator for City Hall

Since December 1999 the City has allocated funds towards the construction of an elevator at City Hall. The project is part of the City’s overall program to remove access barriers in accordance with the Americans with Disabilities Act (ADA). Staff presented a recommendation to award an engineering contract and begin the process to construct the elevator at the December 3, 2002, January 7, 2003 and January 21, 2003 City Council meetings. At the January 21, 2003 the City Council requested that staff bring back additional information about the need for this project.

Other ADA Projects

In addition to the construction of an elevator the following CDBG funded projects are identified for action in FY 03 – 04:

  • Reconstruction of an access ramp at the community room ($ 15,000)
  • Construction of ADA compliant access ways to park facilities ($ 82,000)

Reprogramming of CDBG funds

In addition to the funds programmed for engineering services for the elevator, and the two ADA project programmed for construction discussed above, in December 2002 $225,000 was reprogrammed from the Alta Mira project to an unnamed ADA project. This action was taken in response to pressure from the CDC to spend down the CDBG balance. These funds could be used for the elevator construction, or any ADA project.

The city’s current plan for the use of CDBG funds for FY 02 – 03 and 03 – 04 is as follows:


FY 02 – 03

FY 03 - 04



$ 25,000

$ 20,000

$ 45,000

Reach Program


$ 34,000

$ 73,000

Home Improvement Program


$ 100,000

$ 327,000

Alta Mira Canyon Channel


$ 700,000

$ 700,000

Engineering for City Hall elevator


$ 55,000

$ 55,000

Unnamed ADA Project


$ 225,000

$ 225,000

Programmed ADA projects Citywide

$ 25,000

$ 72,000

$ 97,000




$ 1,522,000

Timely use of CDBG funds

Under CDBG guidelines the city is limited in the amount of time that CDBG funds are allowed to accumulate. In the past the Los Angeles Community Development Commission (CDC) – the agency that administers the program for the federal government – has not been rigid in the enforcement of this guideline. In the past year, however, the CDC has made it clear that given the amount of time over which the City has accumulated funds for the Alta Mira Canyon project, if construction is not underway by March 2004, funds in excess of 150% of our annual allocation will be recaptured and given to agencies with eligible construction ready projects. The City’s annual allocation of CDBG funds is approximately $ 240,000. Under such a scenario as much as $600,000 of our CDBG funds could be recaptured.


The purpose of this report is to provide addition information to the City Council regarding the CDBG program, so staff can receive direction from the City Council on how the City’s CDBG funds should be expended in light of the more aggressive stance being taken on the timely use of funds.

Staff has identified the following issues that need to be resolved:

  1. Should the City continue to accumulate funds for the Alta Mira Canyon Project?
  2. Should the City pursue an alternate project to the Alta Mira Canyon project?
  3. What ADA projects should be pursued?
  4. Should the City consider the sale of excess CDBG funds?

Alta Mira Canyon

Based on direction received from the City Council, staff held a series of meetings with Dr. Robert Douglas, a professor of Geology at the University of Southern California and Chairman of the Abalone Cove Landslide Abatement District. The purpose of the meetings was to perform value engineering to determine if a project can be identified that both achieves the project goals and be constructed at a cost that requires no City General Fund contribution.

After several meetings it was concluded that there is not adequate data available to perform the necessary value engineering. More fundamentally it was concluded that additional engineering data is needed to support the overall project concept that channel lining, as proposed, in the immediate vicinity of the head of the landslide will both withstand the design storm flows and significantly reduce the entry of channel water into the landslide.

Due to the lack of engineering data, the amount of time that will be required to obtain the necessary rights of way, and the impending deadline for the expenditure of funds, both staff and the ACLAD board concluded that the Alta Mira Canyon project as currently designed should be placed on hold.

It was agreed that if sometime in the future if rights of way were dedicated, and additional information becomes available which is more convincing that lining the canyon has the cost benefit ratio to justify a project, and if funding from sources other than the City are available, the project might once again be pursued.

It is, however, recommended that the City utilize a portion of the funds set aside for the Alta Mira project for two activities with a goal similar to that of the Alta Mira Canyon project:

Conduct an engineering study of ground water in Abalone Cove. The study will investigate where dewatering wells should be placed to extract ground water along Alta Mira Canyon. Staff estimates the costs of such a study at $ 15,000.

Establish a project to construct three dewatering wells within the Abalone Cove project area. The City and ACLAD would construct the wells as a joint project. The City would take the lead in design and construction activities, while ACLAD would take the lead on obtaining the necessary rights of way, development of the discharge facilities, and for the maintenance of the wells. Staff estimates the City cost of such a project at $75,000.

ADA Projects

Elevator at City Hall

The attached staff report of January 21, 2003 presents information regarding the city’s overall plan to remove barriers from city facilities. It presents the basis for staff’s recommendation that CDBG funds should be used at this time to construct an elevator at City Hall. Staff continues to believe the City can best use its block grant funds for ADA activities with the construction of an elevator at City Hall. The rationale is that the elevator has a number of important collateral benefits that many ADA projects do not. For example some staff members and volunteers who find it challenging to climb the stairs would benefit, as would members of the city’s maintenance staff who move bulky items as part of their job. Just recently much bulky furniture was removed from the second floor of City Hall; this was a very difficult task without the benefit of the elevator. Staff believes that while all CDBG eligible ADA projects benefit many people, not one has the number of important collateral benefits that the elevator offers.

At the January 7, 2003 City Council meeting there was discussion that the existing City Hall will probably be demolished and a new facility constructed in a time frame that makes construction of the elevator a waste of money. Staff believes that an elevator is justified even if the remaining life of the City Hall building is only five years. This is particularly true if the alternative is to sell CDBG funds at 50 - 60˘ on the dollar. If the total cost of an elevator installation is $280,000; the equivalent general fund cost is $154,000. Over a five year life the annual cost of the elevator would be $ 30,800.

Other ADA projects:

In accordance with the City’s plan to remove access barriers from City facilities the following two projects are included in the proposed FY 03 – 04 Budget:

Reconstruct the access ramp to the Community Room $15,000

Provide access to picnic facilities at the City’s parks $ 82,000

Sale of Block Grant Funds

It is clear that the City will not be able to spend adequate CDBG funds in time to meet program guidelines. The most appropriate solution would be for the city to sell a portion of its CDBG funds. Several cities have indicated that they wish to purchase CDBG funds. Staff estimates that CDBG funds can be sold at 50 – 60˘ per $1.

Calculation of CDBG Funds eligible for sale:



Total Funds Available

$ 1,522,000

Planned Expenditures:



$ 45,000

Reach Program

$ 73,000

Home Improvement Program


Various non elevator ADA projects

$ 97,000

Funds available less planned expenditures

$ 980,000

Staff Proposed Expenditures:


Elevator – Engineering

$ 55,000

Elevator – Construction

$ 225,000

Engineering – Groundwater study

$ 15,000

Installation of dewatering wells

$ 75,000

Funds available less planned and proposed expenditures

$ 610,000

Note: Max amount of CDBG funds that the City may accumulate is 150% of our annual allocation of $240,000 or $360,000.


Adopting the staff recommendations will place the Alta Mira Canyon project on hold, and begin work on an engineering study on ground water, and a construction project to develop three new dewatering wells in Abalone Cove. Staff will return to the City Council with contracts for these activities.

Adopting the staff recommendations will award a contract for engineering services to John Cruickshank Inc. for preliminary engineering services for the construction of an elevator at City Hall. When the study is completed it will be presented to the City Council for review and award of final engineering services for the preparation of the final construction plans.

Finally, adopting the staff recommendations will result in staff evaluating how much CDBG funds can be sold, and to make inquires about potential buyers. Staff will gather this information and bring the matter back to the City Council for further action.


The recommended actions will result in the expenditure of $6,400 for preliminary engineering services related to the construction of an elevator at City Hall. The expenditure of funds for the dewatering well construction, and the engineering study will require additional City Council action prior to the expenditure of any funds.

Placing the Alta Mira Canyon Project on hold, and the substitution of two smaller projects will result in the expenditure of less CDBG funds, and will therefore will have a positive fiscal impact. It is estimated that adoption of the recommended actions, and the construction of an elevator will result in the need to sell approximately $610,000 worth of CDBG funds. If these funds were sold for 55˘ per dollar it would generate approximately $ 335,000 of General Fund monies. If the construction of the elevator does not take place and additional $280,000 worth of CDBG funds would need to be sold, and would bring an additional $154,000 in general fund monies.

Submitted by,
Dean E. Allison
Director of Public Works

Reviewed by,
Les Evans, City Manager


Exhibit Flowchart of CDBG eligibility
Exhibit B – List of eligible projects
Exhibit C – List of ineligible projects
Exhibit D – Income Requirements
Exhibit E – March 4, 2003 CDBG Bulletin
Exhibit F – January 21, 2003 Staff Report w/ attachments