TO: Mayor and City Council
THROUGH: Krishna Namburi, Interim City Manager
FROM: Josh Eggleston, Chief Financial Officer
SUBJECT:
title
Transfer of appropriations within the City’s Fiscal Year (FY) 2026 Budget to fund HVAC replacements at Shops Building #24.
Ward(s): All Wards
Councilor(s): All Councilors
Neighborhood(s): All Neighborhoods
Result Area(s): Good Governance.
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SUMMARY:
summary
A transfer of $42,700 in appropriations from General Fund contingency is needed to fund the replacement of the HVAC units of City Shops Complex Building #24. The unit on the second floor of the building has completely failed and it is an occupied portion of the building for Facilities and Radio staff. Due to required R22 (refrigerant) replacements, the two HVAC units in the building were scheduled to be replaced in FY 2027. With the failure of the upper unit, staff determined it to be more economical to replace both units now.
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ISSUE:
Shall the City Council adopt Resolution No. 2025-20 authorizing a transfer of $42,700 in appropriations within the City’s FY 2026 budget and approving a project for replacement of two HVAC units at Shops Building #24?
RECOMMENDATION:
recommendation
Adopt Resolution No. 2025-20 authorizing a transfer of $42,700 in appropriations within the City’s FY 2026 budget and approving a project for replacement of two HVAC units at Shops Building #24.
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FACTS AND FINDINGS:
FROM: General Fund, Non Departmental, Contingencies, 101-60961000-61110, $42,700
TO: General Fund, Non Departmental, Transfers to other funds, 101-60961000-62110, $42,700
ADD: Capital Improvements Fund, Constr – Shops Complex Construction, Interfund transfers – Gen fund money, 255-60902500-39105, $42,700
ADD: Capital Improvements Fund, Constr – Shops Complex Construction, Construction contracts, 255-60902500-52620, $42,700
At the Shops Complex, Building #24 is occupied by Radio Communications and Facilities staff. In August, Facilities staff notified the Budget Office that the HVAC unit on the second floor failed – resulting in no heating or cooling on the second floor of the building. Staff have rescheduled meetings or moved locations to work around the outage, but as winter approaches, the replacement is needed.
Both units at the building were planned for replacement in FY 2027 due to the required phase out of R22 refrigerant because of environmental concerns but were removed from the Capital Improvement Plan due to lack of identified funding. Both units are 22 years old and had a useful life of 15 years. There are economies of scale for installation costs to replace both units now rather than just replacing the failed unit. Completing replacement of both units would also produce savings by no longer having units that runs on R22 which has increased in price significantly in recent years.
BACKGROUND:
Oregon State budget law allows the City Council to approve a transfer of appropriation from one fund to another when a specific need is identified.
Kelli Blechschmidt
Management Analyst II
Attachments:
1. Resolution No. 2025-20