The Carnegie Arts Foundation will be getting a financial boost soon, now that the Turlock City Council has agreed to refund the majority of its security deposit.
At Tuesday night's meeting, the City Council voted 4 to 1 to return $70,000 of the remaining $80,000 deposit. The city will continue to hold $10,000 as the deposit, but will pay the Carnegie Arts Foundation any accrued interest on it every July 31. The Carnegie Arts Foundation also will be getting the interest earned off the $70,000.
In October 2009, the city entered into a lease agreement with the Foundation to operate the Carnegie Arts Center. At that time it was stipulated that the Foundation put down a $100,000 deposit.
In May 2012, the Foundation requested a full refund of the deposit. The city opted to return $20,000 to the Foundation and hold the remainder.
Carnegie Arts Center Executive Director Rebecca Phillips Abbott said the request for the funds was done because the Carnegie Arts Foundation could earn a better rate of return than the city and because it honored the original intent of the donations.
"The funds were originally donated by the citizens of Turlock to run an arts center and we would like to go through with that original commitment on the part of the citizens," Abbott said.
The Carnegie Arts Foundation is responsible for the operations at the arts center and its request for the refund was endorsed by city staff, based on the good-standing of the organization.
"The Carnegie is in better shape than originally expected," said Turlock Police Lt. Ron Reid, serving as the assistant to the city manager.
The lone voice of opposition to the refund was Councilmember Amy Bublak, who wanted the Carnegie Arts Foundation to produce a fiduciary report from a certified accountant before returning the deposit.
"I would like to wait for a certified copy to prove that they're solvent and give it all back if that is the case," Bublak said.
The Carnegie Arts Center did submit an annual report earlier this year that showed the organization generated more than $765,000 in revenue over the 15 months and had expenses of just more than $446,000. The arts center also brought in nearly $2 million in endowment pledges.
"The Carnegie has complied with our request," Councilmember Bill DeHart said. "I think to link another year with our decision would be unreasonable and on that basis I would support the refund."
Also on Tuesday the City Council:
• Approved a motion to authorize the non-profit Covenant Retirement Communities to issue bonds for capital improvements. Covenant Retirement Communities operate Covenant Village of Turlock and Sequoia Place. The request is for bonds totaling $40 million, of which up to $10 million would be allocated for the Turlock properties. The request for the city's approval for the bond issuance is to fulfill an Internal Revenue Service requirement that the agency go through the city's governing body to gain access to the bond market. The city will not take on any liability for the bond issuance.
• Approved the purchase of 11.34 acres of land at 1801 S. Walnut Road for $857,000 as part of the new master plan storm water basin project selected for the site.
• Accepted the 2012 annual report from the Turlock Fire Department.
• Received information of the 2013-14 Non General Fund budget.
• Proclaimed May 9 as Fava Bean Day.