TO:
Honorable Mayor and Members of the City Council
THROUGH:
Talyn Mirzakhanian, City Manager
FROM:
Erick Lee, Public Works Director
Gilbert Gamboa, Acting City Engineer
Erika King, Senior Management Analyst
SUBJECT:Title
Conduct Public Hearing and Consideration of a Resolution Regarding the Proposed Five-Year Capital Improvement Program and Consideration of a Resolution for Fiscal Year 2025-2026 Through Fiscal Year 2029-2030 (Public Works Director Lee).
(Estimated Time: 15 Mins.)
A) CONDUCT PUBLIC HEARING
B) ADOPT RESOLUTION NO. 25-0073
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RECOMMENDATION:
Staff recommends that City Council:
1. Conduct a Public Hearing; and
2. Adopt Resolution No. 25-0073 approving the Five-Year Capital Improvement Program (CIP) for Fiscal Year 2025-2026 (FY 2026) through Fiscal Year 2029-2030 (FY 2030).
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EXECUTIVE SUMMARY:
The City of Manhattan Beach is dedicated to ensuring that its capital infrastructure is well-maintained and up to date. A core mission of the City is to guarantee that its facilities and infrastructure meet the current and future needs of the community it serves. This is accomplished by planning for and implementing a robust Capital Improvement Program that addresses physical assets throughout the City, including, but not limited to, streets and other right-of-way facilities, water, sewer, storm drain infrastructure, public buildings, parks and open spaces, and community amenities.
Public Works staff has prepared the attached Five-Year CIP, which updates the annual CIP adopted last year. Overall, the proposed CIP focuses on improving City security, ensuring compliance with storm drain quality regulations, upgrading parks and recreational facilities, improving infrastructure to maximize utilization of the City’s groundwater supply, and continuing with citywide transportation improvements.
This report provides a comprehensive overview of the proposed CIP for Fiscal Years 2026 through 2030. Projects are categorized by funding source and reflect prior, current, and projected appropriations. The proposed CIP includes 110 distinct projects, totaling an estimated $188.7 million in planned investments.
The Planning Commission reviewed the proposed Five-Year CIP Project List on April 23, 2025 and determined that it is consistent with the City’s General Plan. The Parking and Public Improvements Commission (PPIC) also reviewed the draft CIP on April 24, 2025 and did not recommend any modifications.
A comprehensive overview of the proposed Five-Year CIP was presented to the City Council during public meetings held on May 13 and May 20, 2025. During the May 20, 2025 meeting, the Council directed staff to make the following revisions to the Five-Year CIP:
1. Adjust funding allocations in the CIP Fund to create a reserve of at least $1,500,000 each year. This was accomplished by reducing FY 2026 funding for the project at 400 Manhattan Beach Boulevard by $1,000,000.
2. Advance the Renovation of the City Hall Employee Lounge Project from FY 2028 to FY 2026. This was accomplished by reducing FY 2026 funding for the City Facility Renovations project by $100,000.
3. Consider adding a new project for replacing the railings at the Upper State Pier Parking Lots. Staff has added this project with an estimated budget of $700,000 in FY 2028 under the State Pier and Lot Fund.
FISCAL IMPLICATIONS:
The proposed Five-Year CIP includes total projected funding of $27,475,337 for FY 2026, which will be incorporated into the City’s Operating Budget for appropriation.
The complete Five-Year CIP includes 110 individual projects with a total value of $188,686,564. This total encompasses both ongoing projects and new initiatives planned for implementation over the next five years. Of the total amount, approximately $93.6 million reflects previously approved project funding, while the remaining $95.1 million represents planned expenditures for projects scheduled between FY 2026 and FY 2030.
The proposed Five-Year CIP budget includes the following expenditures:
$27.0 Million Building, Park, Facilities, Air Quality (CIP)
$51.5 Million Streets, Sidewalks, and Other Rights-of-Way Projects (ROW)
$8.7 Million Parking Lot Projects
$6.9 Million Grant Funded Projects
$30.0 Million Sewer Infrastructure Projects
$24.1 Million Water Infrastructure Projects
$1.0 Million State Pier and Lot Projects
$7.4 Million Storm Drain Infrastructure Projects
$31.7 Million Measure W
$375,000 Street Lighting & Landscape Projects
$188.7 Million Total
BACKGROUND:
The Five-Year Capital Improvement Program (CIP) serves as a strategic planning tool that guides the selection and implementation of near- and mid-term capital projects. It is reviewed and approved annually by the City Council as part of the budget process. Projects included in the CIP align with the City’s General Plan and reflect the priorities of the City Council, City staff, user groups, and the broader community.
Each year, Public Works staff conducts a comprehensive review of the CIP to identify new project needs, modify existing projects, and make funding adjustments based on evolving priorities and available resources. Projects are grouped by funding source and reflect prior, current, and anticipated appropriations.
The Planning Commission reviewed the proposed Five-Year CIP Project List on April 23, 2025 and determined that it is consistent with the City’s General Plan. The Parking and Public Improvements Commission (PPIC) also reviewed the draft CIP on April 24, 2025 and did not recommend any modifications.
A comprehensive overview of the proposed Five-Year CIP was presented to the City Council during public meetings held on May 13 and May 20, 2025. During the May 20, 2025 meeting, the Council directed staff to make the following revisions to the Five-Year CIP:
1. Adjust funding allocations in the CIP Fund to create a reserve of at least $1,500,000 each year. This was accomplished by reducing FY 2026 funding for the project at 400 Manhattan Beach Boulevard by $1,000,000.
2. Advance the Renovation of the City Hall Employee Lounge Project from FY 2028 to FY 2026. This was accomplished by reducing FY 2026 funding for the City Facility Renovations project by $100,000.
3. Consider adding a new project for replacing the railings at the Upper State Pier Parking Lots. Staff has added this project with an estimated budget of $700,000 in FY 2028 under the State Pier and Lot Fund.
The reallocation of $1,000,000 from the 400 Manhattan Beach Boulevard project will result in increased CIP reserve fund balances of $1.5 million in FY 2026, $1.5 million in FY 2027, $2.0 million in FY 2028, $3.0 million in FY 2029, and $4.0 million in FY 2030.
DISCUSSION:
This report highlights the 110 proposed projects included in the Five-Year Capital Improvement Program (CIP), grouped into 10 distinct funding categories. Collectively, these projects represent approximately $188.7 million in planned investments over the next five years. It is important to note that most of the ten funding categories have strict eligibility criteria, which generally prevent projects from being reallocated across categories unless they meet the specific requirements of the new category.
A comprehensive list of the proposed Five-Year CIP projects, including recommended funding sources and amounts, is provided as an attachment to this report. All project line-item adjustments are shown in red for reference. A CIP Project Summary Sheet Report, detailing capital costs and funding sources for all projects, is also included as an attachment .
The following sections summarize the various categories of CIP funding:
CIP Funds $26,979,943 38 Projects
This category of projects addresses all of the projects that do not typically qualify for funding from the nine other groups listed herein. Projects include building and other facility improvements, park facility upgrades, signage, other right-of-way and public property improvements, and the acquisition of 400 Manhattan Beach Boulevard. Also included in the CIP Fund is an allocation for the Manhattan Beach Unified School District (MBUSD). The District has requested funding for the City to perform additional slurry seal work in parking lots, playgrounds, and blacktop areas at specific schools and facilities. While the City normally performs such work with its slurry seal street projects when they are near MBUSD schools, per the Master Use Agreement between the City and the MBUSD, the areas requested by the District are not anticipated to be performed by the City for many years and need priority attention. As such, a $250,000 allocation is proposed in Fiscal Year 2025-2026 for this purpose. The consideration of such funding is allowed under the Master Use Agreement. Funding sources include:
$191,214 AB 2766 Air Quality Fund: The fund is generated from revenues collected from Assembly Bill 2766 Motor Vehicle Subvention Fund Program to reduce air pollution from motor vehicles and for related planning, monitoring, enforcement, and technical studies.
$26,788,729 CIP Fund: This fund is generated from a combination of dedicated General Fund revenues, including transient occupancy tax (TOT), parking citations, and parking meter revenues.
Streets, Sidewalks, and ROW Funds $51,489,823 28 Projects
This category of projects focuses on the rehabilitation, improvement, and enhancement of the City’s streets, sidewalks, curbs, and gutters. Project types include street resurfacing, slurry seal applications, replacement of damaged sidewalks, curbs, and gutters, intersection and turn movement upgrades, lane widening for capacity improvements, pedestrian safety enhancements, and Americans with Disabilities Act (ADA) access upgrades.
Projects in the Streets, Sidewalks, and Rights-of-Way category are supported by four Local Return funding sources, which are typically combined within a given fiscal year to fund one or two larger roadway projects. In addition to the locally funded efforts, there are 12 individual grant-funded projects included in this category.
The Local Return funding sources and their corresponding programmed revenues are as follows:
$11,154,432 Gas Tax Fund: This fund can be used for a broad array of street- and sidewalk-related projects. Both local and arterial roadway projects are eligible. This Fund also includes the voter-affirmed Senate Bill 1 tax on gasoline.
$22,747,709 Measure M Fund, inclusive of grants from Metro: This fund can be used for a broad array of street- and sidewalk-related projects throughout the City, as well as storm drain pollution control projects. Both local and arterial roadway projects are eligible.
$4,929,250 Measure R Fund, inclusive of grants from the U.S. Department of Transportation Section 5310 and Community Project Funding (CPF): This fund can be used for a broad array of street- and sidewalk-related projects throughout the City. Both local and arterial roadway projects are eligible.
$12,658,432 Proposition C Fund, inclusive of grants from South Bay Highway Program (SBHP) and Metro: This fund is limited to arterial and collector transportation corridors and can be used for street rehabilitation, maintenance, and access improvements on these corridors.
Parking Fund $8,730,000 7 Projects
This category includes projects focused on the maintenance, repair, and rehabilitation of public parking facilities owned or managed by the City. These facilities include the Metlox structure, three additional downtown parking structures, the North Manhattan Beach parking structure and streetscape, and several Los Angeles County-owned beach parking lots. Project funding is primarily supported by revenue generated from parking meter fees collected at both public lots and curbside meters.
State Pier and Lot Fund $1,025,000 2 Projects
This category of projects addresses the maintenance, repair, and rehabilitation of State-owned upper and lower Pier parking lots as well as the Manhattan Beach Pier itself. Eligible projects include replacement and/or repair of the railing system, lighting, restrooms, and deck, and installation of public safety devices. Funding for projects in this category comes from the meter fees collected by visitors and patrons utilizing the upper and lower Pier parking lots. As requested by the City Council on May 20, 2025, this fund now includes a new project for replacing the railings at the Upper State Pier Parking Lots.
Grants and Other Outside Funds $6,870,500 10 Projects
This is a fund for projects that are either fully or partially funded by state, federal, or local grant funding, or funding from another outside funding source, such as a private or non-profit organization. Funding sources include Measure A, Measure M, Community Development Block Grants (CDBG), Community Project Funding (CPF), and Highway Safety Improvement Program (HSIP).
Storm Drain Funds $7,371,611 11 Projects
This category of projects addresses the infrastructure needs for both storm drain conveyance and National Pollution Discharge Elimination System (NPDES) compliance requirements. Projects include storm drain repairs and upgrades, capacity enhancements, trash capture devices, Enhanced Watershed Management Plan (EWMP) infrastructure needs (e.g., infiltration projects), and Storm Drain Capital Best Management Practices (BMPs).
Measure W Funds $31,739,101 5 Projects
This category of projects focuses on enhancing water resilience and compliance by addressing challenges such as polluted waterways, aging, and insufficient infrastructure. Key initiatives include storm drain improvements, installation of trash capture devices, and infrastructure projects identified in the Enhanced Watershed Management Plan (EWMP), such as infiltration systems that improve water quality and support local groundwater recharge.
Measure W provides two primary funding streams to support these efforts: the Municipal Program, which allows cities to construct projects or implement strategies to capture and treat stormwater locally, and the Regional Program, which supports large-scale regional infrastructure initiatives that advance watershed health.
Street Lighting and Landscape Fund $375,000 1 Project
This category addresses the repair and replacement of the City’s streetlights. In 2019, the City purchased 825 streetlights from Southern California Edison (SCE). Transitioning from utility-owned poles to customer-owned poles was projected to save the City nearly $90,000 annually. A portion of this annual savings has been appropriated to future pole maintenance and pole replacement needs in the Street Lighting and Landscape Fund.
Sewer Fund $29,976,856 9 Projects
This category of projects addresses the infrastructure needs, operation, and maintenance of the City’s sewer system, and includes sewer mainline replacements, lift station refurbishments, and required studies and master plans. The projects in this category are fully funded through the Sewer Enterprise Fund using revenues collected through sewer fees.
The majority of the funding appropriated in this category is for addressing aging lift stations. Lift stations are the backbone of an otherwise gravity flow system, and their proper care is paramount to the safe and effective operation of the entire wastewater system.
Water Fund $24,128,730 13 Projects
This category of projects addresses the infrastructure needs, operations, and maintenance of the City’s water system, and includes water main and valve replacements, pump station refurbishments, reservoir maintenance and/or replacement, well pumping and treatment activities, meter upgrades and automation, and all studies and master plans. The projects in this category are fully funded through the Water Enterprise Fund using revenues collected through fixed and variable water rates.
CONCLUSION:
Staff recommends that City Council conduct a Public Hearing and adopt Resolution No. 25-0073, approving the Five-Year CIP Plan for FY 2026 through FY 2030. Appropriation of $27,475,337 for Fiscal Year 2026 will occur during the City Council’s adoption of the City’s FY 2026 Operating Budget.
PUBLIC OUTREACH:
Staff participated in various other community meetings and presented the 5-Year CIP Project List at public Planning Commission, PPIC, and City Council meetings. The Plan reflects the priorities outlined in the City Council Work Plan.
ENVIRONMENTAL REVIEW:
The City has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that adoption of the 5-Year CIP is not a “Project” as defined under Section 15378 of the State CEQA Guidelines; therefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines the activity is not subject to CEQA. Thus, no environmental review is necessary.
LEGAL REVIEW:
The City Attorney has reviewed this report and determined that no additional legal analysis is necessary.
ATTACHMENTS:
1. Resolution No. 25-0073
2. Schedule of Capital Improvement Projects by Fund
3. Final Five-Year CIP FY 2026 Through FY 2030 Project Summary Sheets
4. PowerPoint Presentation