Goleta staff outline $50.8M five‑year CIP unfunded gap; council debates reclassifying projects and funding priorities

City finance and public works staff presented the preliminary capital improvement program (CIP) budget and prioritization framework to the Goleta City Council on May 6, reporting an estimated $50.8 million in unfunded projects in the active five‑year CIP and identifying a subset of near‑term priority projects with a combined funding gap of about $7.7 million.

Luke Grill, finance director, said the packet reorganizes the CIP and restricts the five‑year list to active priority projects; other projects were proposed to be reclassified into a new long‑term CIP list. He told council the California construction cost index has driven inflation in construction costs and that many projects remain subject to change once bids are received.

Public works director Nina Bueno reviewed recent completions, projects at design and bid stages, and projects recommended for reclassification. Staff proposed transferring several projects to the long‑term CIP (including some that likely will be driven by future development impact fees) and highlighted a small set of major projects — characterized in staff materials as the “big 6” — that are in or entering construction and warrant prioritization for available onetime funds. Those projects include Project Connect, the Train Depot improvements, Goleta Valley Library safety/ADA work, and the San Jose Creek multipurpose path; San Jose Creek carries a pending federal grant award for $3.75 million that staff said could reduce the city’s funding need for that item.

Council members debated which projects should remain in the five‑year CIP and which should move to the long‑term list. Several members urged staff to prioritize projects that staff can reasonably complete within five years or that are already funded or contractually committed. Council members also discussed Fire Station 10 — staff recommended reclassifying it to the long‑term list because of funding uncertainty, but multiple council members urged keeping it on the five‑year list because the city and County Fire Protection District are actively negotiating funding and a memorandum of understanding.

Staff presented updated general fund year‑end projections that showed a projected June 30 general fund balance of roughly $22.9 million; staff said about $1.7 million of that could be programmed toward CIP in the current cycle, increasing the discretionary amount available for the “big 6” projects to roughly $4.07 million when combined with previously identified resources. Grill said the city had issued lease revenue and sales tax revenue bonds earlier in the year to help fund major projects and that staff is pursuing grants and other revenue strategies but cautioned that grant timing and construction bidding outcomes create uncertainty.

Council discussion covered: coordination among projects and applicants, prioritizing projects eligible for grants, the need for a public validation process for long‑term CIP entries, the roles of development impact fees and future grant opportunities, and the city’s rising ongoing maintenance needs as new infrastructure comes online. Staff estimated that operating and maintenance costs for new infrastructure could add roughly $1–2 million annually by fiscal year 2027–28.

A member of the public asked whether bid results could exceed current project estimates; staff confirmed bids for projects out to bid may come in higher than preliminary estimates and that staff will return with updated figures. Council did not take a formal vote on CIP categories at the workshop; staff requested direction on which projects council wants moved between the five‑year and long‑term lists and recommended prioritizing funding toward the near‑term priority projects while continuing to pursue grant opportunities.

Key funding details and contingencies

- Staff reported the five‑year CIP’s estimated unfunded total at roughly $50,805,000 and a near‑term funding gap for priority projects of about $7,700,000. - Staff identified approximately $4,070,000 in potential one‑time funding that could be redirected to priority projects (including newly projected year‑end general fund resources of about $1.7 million); if a pending $3.75 million grant for San Jose Creek is awarded, the gap could shrink further. - Several projects are out to bid with bid openings noted in May; bid results will inform final project costs and funding decisions.

Next steps

Staff said it will update the CIP document and funding plan based on council direction, continue to pursue grants and other financing options (including assessments and special financing districts), and return with refined budgets as bid results and grant decisions arrive. Council directed staff to return with recommended public stakeholder validation for long‑term CIP items and to continue active negotiations and evaluation for Fire Station 10.