FEBRUARY 1, 2005 RANCHO PALOS VERDES CITY COUNCIL MINUTES FEBRUARY 1, 2005 RANCHO PALOS VERDES CITY COUNCIL MINUTES

DRAFT

MINUTES

RANCHO PALOS VERDES CITY COUNCIL

REGULAR MEETING

FEBRUARY 1, 2005

The meeting was called to order at 6:00 P.M. by Mayor Clark at Fred Hesse Community Park, 29301 Hawthorne Boulevard, and was immediately recessed to closed session. At 7:19 P.M., the meeting was reconvened for regular session.

Roll call was answered as follows:

PRESENT: Gardiner, Long, Stern, Wolowicz, Mayor Clark

ABSENT: None

Also present were City Manager Les Evans; Assistant City Manager/City Clerk Carolynn Petru; City Attorney Carl Lynch; Director of Planning, Building, and Code Enforcement Joel Rojas; Director of Public Works Dean Allison; Finance Director Dennis McLean; Associate Planner Dave Blumenthal; Recording Secretary Denise Bothe.

FLAG SALUTE:

The flag salute was led by Tony Cho, from Boy Scout Troop No. 658.

MAYOR’S ANNOUNCEMENTS:

Mayor Clark announced that there were two recycler winners from the last City Council meeting in January: Ray Seager and Robert Yashigada. He stated that all winners would receive a check for $250, which represented one year of free refuse service; and he encouraged everyone to recycle.

Mayor Clark commented on the "Did You Know Facts" regarding median home prices in Rancho Palos Verdes. He stated that in 2003, single-family homes had a median price of just over $800,000 and $730,000 for condos/townhomes; that in 2004, single-family homes had a median price of $985,000 and $880,000 for condos/townhomes; and that at the current time, the average median price for single-family homes in RPV was just over $1 million and $825,000 for condos/townhomes. He noted that the number of residential single-family homes in RPV was 13,379; and 2,290 multi-family residential units; and advised that there were 91 homeowner associations in RPV, 48 of which were current members of the RPV Council of Homeowner Associations. On behalf of Council, Mayor Clark thanked and commended all homeowner associations, particularly those that were members of the RPV Council of Homeowner Associations, who bring forward ideas, thoughts and communicate with their fellow residents on how to make this a unique community.

APPROVAL OF AGENDA:

Councilman Stern moved, seconded by Mayor pro tem Wolowicz, to approve the Agenda as submitted. Without objection, Mayor Clark so ordered.

PUBLIC COMMENTS:

Lois Larue, 3136 Barkentine Road, stated that an area between her home and Portuguese Bend was once again a mess as a result of the recent rains; and stated that a woman assisting the Director of Public Works was very helpful when she recently called the City, but questioned if proper protocol had been followed in hiring this woman, noting that she was unfamiliar with this person.

CITY MANAGER’S REPORT:

With regard to the recent sinkhole, City Manager Evans advised that earlier that day Western Avenue was reopened along its full length; stated that there was two-way traffic available at Western Avenue and Westmont; that Caltrans opened Western Avenue north of Summerland on the previous Saturday providing one lane of traffic in each direction using the southbound lanes of traffic while Caltrans was conducting repairs in the northbound lanes.

With regard to Channel 33, City Manager Evans stated that Cox Communications was very close to completing the laying of cable to connect RPV’s studio facility to the Cable operator’s facility in the Peninsula Shopping Center; explained that Cox had originally proposed and designed the route of the cable at the Civic Center property to cut across the area near the tennis court, straight to the cable studio; but because staff was not sure what may happen in this portion of the site in the future, staff recommended that Cox route the cable around the perimeter of Civic Center, so the studio would not have to be taken out of service and the cable relocated for a future City project. He stated that Cox had agreed to redesign the cable routing in this; and noted staff’s expectation of the City Cable Studio being on line by the end of March or the beginning of April.

OLD BUSINESS:

Mayor Clark advised that a list of Old Business can be found on the City’s website.

NEW BUSINESS:

APPROVAL OF CONSENT CALENDAR:

Mayor Clark stated that he would recuse himself from Item No. 6 regarding the Los Angeles Air Force Base Regional Alliance.

Councilman Long moved, seconded by Mayor pro tem Wolowicz, to approve the Consent Calendar, with a split vote on Item No. 6.

Mayor pro tem Wolowicz requested that a future Council Agenda include a discussion of the expenditures for the Sheriff’s Department and their participation in emergency situations relating to storm drain failures, such as traffic control; and stated that he would like that item to address the City’s aggregate costs for such purposes.

Motion to approve the Consent Calendar, sans Item No. 6, carried as follows:

AYES: Gardiner, Long, Stern, Wolowicz, Mayor Clark

NOES: None

ABSTAIN: None

ABSENT: None

Motion to Waive Full Reading

Adopted a motion to waive reading in full of all ordinances presented at this meeting with consent of the waiver of reading deemed to be given by all Council Members after the reading of the title.

Approval of the Minutes of November 16, 2004, January 10, 2005 and January 11, 2005.

Approved the Minutes of November 16, 2004, January 10, 2005 and January 11, 2005.

Receive Border Issues Report.

Received and filed.

Repair of the Tarapaca Storm Drain

Reviewed and reconfirmed a four-fifths (4/5ths) vote, the Council’s action on December 21, 2004, to authorize staff to conduct an informal bid process to repair the Tarapaca Storm Drain.

Grant for Seat Belt Compliance Campaign

Authorized the City to act as the pass-through agency for a $14,985 grant awarded to the Lomita Sheriff’s Station by the State Office of Traffic Safety (OTS) for the 2005 Seat Belt Compliance Campaign.

December 2004 Treasurer’s Report

Received and filed the December 2004 Treasurer’s Report for the City of Rancho Palos Verdes.

Register of Demands

ADOPTED RESOLUTION NO. 2005-09, A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES ALLOWING CERTAIN CLAIMS AND DEMANDS AND SPECIFYING FUNDS FROM WHICH THE SAME ARE TO BE PAID.

Motion to approve Item No. 6 carried as follows:

AYES: Gardiner, Long, Stern, Wolowicz

NOES: None

ABSTAIN: Mayor Clark

ABSENT: None

Los Angeles Air Force Base Regional Alliance

ADOPTED RESOLUTION NO. 2005-10, AMENDING RESOLUTION NO. 2004-45, THE BUDGET APPROPRIATION FOR FY 04-05, FOR A BUDGET ADJUSTMENT TO THE CITY’S GENERAL FUND.

PUBLIC HEARINGS:

Appeal of a Grading Permit (Case No. ZON2003-00088), for property located at 49¼ Rockinghorse Road [Appellant: Stan Rinehart] (Continued hearing from November 2, 2004).

The staff report of February 1, 2005 recommended that Council continue the public hearing to May 24, 2005.

Councilman Stern moved, seconded by Mayor pro tem Wolowicz, to continue this matter to May 24, 2005. Without objection, Mayor Clark so ordered.

Mayor Clark advised that the applicant and interested parties had requested the continuance to further explore an amicable settlement.

City Tree Review Permit Code Amendment (Case No. ZON2004-00160) (Continued hearing from December 7, 2004)

The staff report of February 1, 2005 recommended that Council continue the public hearing to February 15, 2005.

Councilman Stern moved, seconded by Councilman Long, to continue this matter to February 15, 2005. Without objection, Mayor Clark so ordered.

Appeal of the Planning Commission’s denial of a revision to Conditional Use Permit No. 23 and a Grading Permit (Case No. ZON2004-00215), for property located at 2930 Vista Del Mar [Appellant: Obelisk Architects for Property Owners Mr. and Mrs. Modisette] (Continued hearing from December 7, 2004).

Associate Planner Blumenthal presented the staff report.

Councilman Gardiner requested clarification on the submittal of the plans versus the unapproved work that had been done.

Associate Planner Blumenthal explained that the applicant had submitted an application to change the plans, but at some point between applying for the change and the Planning Commission’s public hearing, the driveway was built with the existing retaining walls.

Councilman Gardiner asked if Council upheld the Planning Commission’s decision and denied the request would that preclude the applicants from going back and submitting the change request and following through with the proper process.

Associate Planner Blumenthal advised that the Planning Commission denied the request with prejudice, which prevented the applicants from re-applying for one year; if Council upholds the Planning Commission’s decision, it would preclude the applicants from requesting that change again; and in that case the applicant would be required to tear out the existing driveway and build it as originally approved.

Councilman Gardiner questioned if the option was still available for Council to direct the applicants to go back and follow the proper procedure.

In response, Director Rojas advised that the applicants could reapply after one year.

Councilman Long asked for clarification on which of the findings couldn’t be made.

Associate Planner Blumenthal highlighted Circle Page No. 7, Section 1; Circle Page No. 20, Finding No. 3 and Finding No. 4; Circle Page 21, Finding No. 5; and Circle Page No. 22, Item D.

Mayor pro tem Wolowicz asked if the applicant had proposed anything different to reduce the massive appearance of the retaining walls as seen from the neighbor’s yard.

Associate Planner Blumenthal stated that nothing new had been proposed, other than to provide landscaping to mitigate the appearance of the retaining walls.

Councilman Stern noted his understanding that the Planning Commission’s denial was not based upon procedural aspects, but was denied based on an analysis of the project’s merits.

City Attorney Lynch responded that Councilman Stern’s understanding was correct.

Nagy Bakhoum, 3800 Pacific Coast Highway, Torrance, representing the property owners, explained that the applicants and the neighbor had come to an agreement a couple hours before the Council meeting, and believed that they could amicably work out some of the major issues, such as mitigating some of the height of the retaining wall. Mr. Bakhoum explained that several of the driveways on this street begin to descend just beyond the edge of the roadway; and that if the applicants built their driveway in the same manner, they would be able to lower some of the wall height along the outer edge and also lower the actual height of the driveway in relationship to what they’ve proposed. If granted approval that evening, he noted that the applicants would remove the concrete portion of the driveway, re-grade it to a lower level, and lower the wall height by a corresponding amount, thereby mitigating the overall height of the retaining wall; and stated that in return, they will maintain the current driveway alignment. He estimated that they will be lowering the retaining walls between 8 and 22 inches; advised that the Modisettes will plant and maintain mature trees along the driveway and that they will work with the neighbor’s landscape architect to try to locate those trees to the most appropriate locations so as to screen the visual appearance of the driveway.

Councilman Stern questioned if there was any reason why Council couldn’t permit the applicant and the neighbor to work out a mutually agreeable proposal and submit that to the Planning Department for evaluation, noting that if this could be done, this item need not go any further that evening.

Councilman Gardiner questioned whether any further negotiations would be relevant because of the Planning Commission’s findings.

Mayor Clark pointed out that when this item was appealed to City Council, it essentially became a new item; that Council can give weight to the Planning Commission’s decision/findings, but that it’s the Council’s responsibility to consider the facts of the case in relation to the City’s codes and to come up with a final determination regarding the appropriateness of the findings.

Because the changes being proposed by the applicants may be significant enough to directly affect the previous findings for denial, Councilman Long noted the possibility that the appeal was moot at that point.

City Attorney Lynch suggested that if Council wants this revised plan to be submitted, she suggested remanding the entire case back to the Planning Commission, because that way, the Planning Commission’s prior decision is not reversed, not confirmed, that it’s only vacated and sent back; and noted that the Planning Commission can review the revised plan, which staff does not have in its possession, and then make a final determination which hopefully will be agreeable to all.

Dwight Hanger, neighbor, stated that he was not in possession of the revised plans; and stated that the grade should be returned to its original height near the retaining wall, noting that the visual impact of the retaining wall was an important issue.

Fred Sturner, Redondo Beach, stated that he was working with the applicant and expressed his belief the grading could be lowered a bit and that an amicable solution was possible.

Dorian DunLavey, resident, encouraged the Council to do all it could to alleviate the Hanger’s concerns and to make the Modisettes conform to what was approved.

Councilman Long moved, seconded by Councilman Stern, to vacate the Planning Commission’s decision, based on the appellant’s withdrawal of the original request and remanded the matter back to the Planning Commission for reconsideration of a revised design, subject to staff review and the revised design should address, among other things, the concerns of the neighbors and the concerns that the Planning Commission had in denying the application. Without objection, Mayor Clark so ordered.

City Attorney Lynch advised that if Council disagrees with staff’s drafting of the resolution, additional findings could be developed as directed by Council.

CITY COUNCIL ORAL REPORTS:

Councilman Long stated that on Monday morning, he met with Barbara Dye, Executive Director of the Palos Verdes Peninsula Land Conservancy, to obtain an update on various issues, such as plans for the Land Conservancy to begin major fund-raising efforts to purchase the Portuguese Bend Nature Preserve.

Councilman Wolowicz highlighted the following events/meetings he attended:

Mayor Clark highlighted the following events/meetings he attended:

Councilman Long stated that he had been speaking to some members of the League of Women Voters about putting together a forum on infrastructure issues, hoping this would take place sometime in spring; and he stated that he also participated in City Bank’s grand opening, mentioning that he was one of their satisfied customers.

REGULAR NEW BUSINESS:

Appointment of Advisory Board Chairs

The staff report of February 1, 2005, recommended appointing a chair for the Planning Commission, Finance Advisory Committee and Emergency Preparedness Committee.

Council commented on the high caliber of talent of all candidates and noted the difficulty in making the appointee selections.

The votes were tabulated as follows:

Planning Commission:

As a result of the vote, Councilman Stern suggested that the second round limit the vote to Jack Karp and Paul Tetreault.

Mr. Paul Tetreault was selected as the new Planning Commission Chair.

On behalf of Council, Mayor Clark congratulated Paul Tetreault on his appointment and reiterated that the City was very fortunate to have such highly qualified residents who volunteer their time and energy to serve the City.

Finance Advisory Committee:

Councilman Stern moved, seconded by Councilman Gardiner, to appoint Gina McLeod as Chair of the FAC. Without objection, Mayor Clark so ordered

On behalf of Council, Mayor Clark congratulated Gina McLeod on her appointment.

Emergency Preparedness Committee:

Council unanimously voted for Mel Hughes to serve as Chair.

On behalf of Council, Mayor Clark congratulated Mel Hughes on his appointment as Chair of the Emergency Preparedness Committee and noted appreciation of Richard Smith for coming forward to apply. He reiterated Council’s gratitude for all Committee/Commission members who volunteer their time to the City.

RECESS AND RECONVENE

Mayor Clark recessed the meeting at 8:30 P.M. and reconvened the meeting at 8:39 P.M.

Second System Performance Audit of the 2000 Cable Television Franchise Agreement with Cox Communications

Councilman Long explained that he would recuse himself from consideration of this matter because his firm does work with Cox Communications at another office and was unrelated to RPV, but that he chose to avoid any appearance of impropriety. He departed the Council Chambers during the discussion of this matter.

The staff report of February 1, 2005 recommended providing staff and Cox Communications with feedback regarding the second scheduled system performance audit of the 2000 Cable Television Franchise Agreement.

With regard to the Service Level % requirement, Councilman Gardiner stated that it would be helpful for him to have the Federal standard next to the data that reports the actual performance.

Assistant City Manager/City Clerk Petru highlighted Circle Page No. 5, 2A, Customer Service, Customer Call Centers, which addresses the Federal regulation which required the cable operator customer service office to answer calls within 30 seconds a minimum of 90-percent of the time; stated that Council received late correspondence this evening addressing related data for December 2004; and noted the 30-second standard is all that is available.

With regard to Circle Page No. 11, "Conclusion," Councilman Gardner suggested including "As a result of negotiations and the City agreeing to pay for the fiber connections, installation and the equipment, the cable operator is also supporting local programming by providing a cable connection and equipment for the City’s Channel 33," stating that he does not want to minimize Council’s role, the negotiations, and payment by the City.

Addressing Circle Page No. 4, Councilman Stern questioned if Cable Channel Additions 2003, RPV Education Access, is Channel 33.

Assistant City Manager/City Clerk Petru stated that it is Channel 33.

Councilman Stern stated he would not list that as being on line in 2003 or 2004, noting it had taken far too long to negotiate the implementation of this new channel.

Highlighting the data on Circle Page Nos. 5 and 6, Councilman Stern stated that with the exception of two months, Cox has not been able to meet the Federal standard of answering calls within 30 seconds, that Cox was not even close to that standard in a number of the months reflected; and asked staff what remedies were available to the City. He expressed his belief that it was a matter of devoting enough time, resources and personnel to comply with the standard and that it appeared that Cox had made a conscious business decision that it’s cheaper not to hit the standard. He asked if the City had the ability to impose fines, which hopefully would provide some incentive to properly staff the phones.

Assistant City Manager/City Clerk Petru advised that the City did have the ability to impose fines under the Cable Franchise Agreement if Council found Cox to be in default of the Franchise Agreement.

Councilman Stern stated that he was troubled by Cox being consistently off the mark regarding this performance standard.

Mayor Clark highlighted the data on Circle Page 8, Customer Complaints Received by City, stating that the numbers were low and were not necessarily indicative of the number of residents having problems with the their cable service.

Councilman Gardiner asked if there are any other standards were staff found the cable operator to be deficient.

In response, Assistant City Manager/City Clerk Petru advised that there were two other areas identified in this audit where Cox wasn’t in compliance with the standard. She stated that the first had to do with the Acceptable Use Policy which applied to internet customers; advised that the City requires Cox to notify its internet customers in writing of any change to the Acceptable Use Policy at least 30 days prior to the change as part of the billing statement – pointing out that Cox had not abided by this policy for the past four years. She stated that the second standard had to do with when service appointments were made, how quickly the appointments were scheduled; and noted that during both the first and now the second performance audits, Cox had not been able to provide the City with any statistics for the City to determine if Cox was meeting its appointment commitments.

Mayor Clark stated that he had personally experienced a long waiting period for a live person to answer his call to Cox; and questioned if the City requires a live person to answer the call within a short timeframe.

Art Yoon, representing Cox Communications, explained that Cox was attempting to meet or exceed the various standards.

Councilman Gardiner stated it would be helpful for him to see a summary page that set out the standards and how Cox was performing in comparison to each of those standards, both the Federal standards and the ones required by the City’s franchise agreement.

Mr. Yoon stated that he would work with his staff to develop a more comprehensive chart that reflects those statistics.

Councilman Stern asked if Cox had in place a checklist that reflects how it routinely performs in accordance with Federal law or local franchise contracts.

Mr. Yoon noted that Cox had a company-wide analysis that showed whether Cox was in compliance, but indicated there was no month-to-month statistic program in place to show how Cox was performing for the City. He mentioned that the RPV franchise agreement was the most stringent in the country; and stated he did review some of the statistics on a monthly basis and that he was in contact with the customer call center to advise them on the need to improve its performance.

Referring to the statistics provided to Council, Councilman Stern questioned whether Cox had decided that it didn’t need to comply with the 90% Service Level standard, reiterating his belief the data indicated a conscious decision by Cox to limit the size of its customer service staff. He pointed out that the figures were no better from the first performance audit conducted two years earlier.

Mr. Yoon stated that Cox was striving to make improvements in its service; pointed out that in 2002, the numbers reflected a high percentage on meeting the standards; and stated that he did not know why there was such a significant drop-off during the past year. He advised that he had been asked by Cox to personally take steps to improve the statistics; and that he was confident the measures recently put in place would improve these statistics.

Councilman Stern pointed out that Cox was obligated by its franchise agreement to follow through with the provisions in the contract.

Mr. Yoon stated that Cox was in the process of putting together the data but that the entire package was not completed in time for this evening’s meeting, and he reiterated that the requested information would be forthcoming. Mr. Yoon stated Cox was aware there was room for improvement and suggested that Cox track the requested information in the next six months and come back to Council with all the statistical data Council was seeking.

Mayor pro tem Wolowicz noted that industry standards were normally published in trade magazines/publications and questioned if staff had seen those types of statistics and been able to compare Cox’s performance with its peers in the industry. He stated this information would be helpful to gauge the type of service Cox was providing to RPV.

Mr. Yoon stated that according to customer satisfaction surveys, Cox had ranked number one as a cable provider and cable system in the country; and pointed out that the geography and terrain on the Peninsula had a unique affect on Cox’s daily administration of its products, that this was a much more challenging area to provide service in than most other areas.

Mayor pro tem Wolowicz highlighted the importance of Internet service to businesses and residents and questioned if the television statistics relate to Internet issues.

Mr. Yoon stated that the data provided was consolidated, and Internet service was not broken out separately.

Mayor pro tem Wolowicz recalled on two occasions that he was on hold with Cox for 45 minutes and then ultimately spoke with Cox’s technicians who shared their sense of frustration in not being able to get things done quickly; and he stated that his experience was different than the figures reflected on Page 5 of an average waiting time of 107 seconds. He asked if Cox was subject to a statistical data audit by an outside agency.

Mr. Yoon explained that the Peninsula customer tracking surveys reflect an 80 to 90 percent satisfaction rate by those customers who complete these surveys; and reiterated that Cox was rated as the number one cable provider and system in the country.

Mayor pro tem Wolowicz asked that Cox provide a summary page with the most salient statistics on all items so that Council could address the important facts.

Mayor Clark requested input on Internet customers initially paying $34.99 a month and currently having to pay 39.99 a month.

Mr. Yoon explained that $34.99 was the introductory rate and stated that all customers were supposed to be notified when they signed up for internet service that it was an introductory rate, which was typical in the industry. Mr. Yoon pointed out that unlike a lot of other high-speed Internet providers, Cox had no contract; and stated that for any reason, a customer can discontinue their service with Cox. He pointed out that Cox’s number one motivator to perform well was the competition from other providers, DSL, and satellite providers; and stated that Cox had done well in retaining its customer base. In terms of pricing, he pointed out that there were numerous competitive services, which had an effect on pricing.

Councilman Gardiner noted his appreciation for Mr. Yoon’s attempts to answer Council’s questions; highlighted the good service that was provided by Cox a couple years ago when the customer service center was located on the Peninsula; and that the call center was first relocated to San Diego and then live service was replaced by an automated system. He recalled Mr. Yoon’s statement that given some time, he could provide the requested information on what’s required; and noted that it was of little interest to him in an audit sense to hold Mr. Yoon accountable for statistics in performance of Federal standards, that he was more interested in the performance of meeting the City’s standards. He suggested that this matter be continued for 90 days to give Cox an opportunity to provide the data to the City so that Council could then evaluate the service and data on the performance of standards applicable to RPV.

Councilman Gardiner moved to continue the second cable television performance audit for 90 days in order to allow Cox adequate time to provide the data required so that Council may evaluate Cox’s performance on the three data indicators: Service Level (% of calls answered within 30 seconds), service appointments, and the Acceptable Use Policy.

Councilman Stern asked for clarification on what it meant to answer a call, whether it’s measured when the automated system answers the ring or when a voice comes on line.

Mr. Yoon explained that the answer was measured from the time a customer calls to the time the call was concluded, a completed call, that as soon as the automated machine picks up, the call starts the clock and the clock stops when the customer hangs up.

Councilman Stern questioned the accuracy of the statistic that 60 to 90 percent of the calls would be concluded within 30 seconds.

Mr. Yoon explained that a lot of times, people wouldn’t need to get to a live person because most of their questions would be answered by the automated service.

Assistant City Manager/City Clerk Petru noted her understanding the call had to be answered within 30 seconds.

Councilman Gardiner asked that the data define what the standard was, calls answered or calls completed.

Mayor pro tem Wolowicz seconded the motion.

Mr. Yoon mentioned that Cox would need to respond to additional standards than the three mentioned.

Assistant City Manager/City Clerk Petru noted there were additional standard relating to signal leakage and the backup power supply.

Mayor Clark suggested that, other than the ones Council has mentioned this evening, Council would consider those other standard statistics complete in terms of the second performance audit; that Council was carrying over for 90 days the three or four areas that were just identified as having additional data which needed to be analyzed and presented for Council to complete the second performance audit.

Councilman Gardiner requested rather than considering those standard statistics complete, that Council receive a matrix so it can see for all future audits what the list was to contain; that the City could sign off on those which were regarded as satisfactorily completed; and that those statistics which were missing data or unacceptable data could be readdressed.

Councilman Stern reiterated that Cox was consistently far enough off the mark that he believed Cox had made a conscious decision not to put forth the extra effort to meet the standards; questioned what could be done in 90 days to correct this situation; and suggested that the City commence with a penalty/fine process against Cox.

Mr. Yoon stated that Cox’s board of directors had already approved increasing customer service staff by over 10 percent at the call center facility and increased the number of staff on duty at the same time; and stated that he was very confident Council would see some improvement within 90 days.

Councilman Gardiner expressed his belief that the City did not lose the right to go back and access fines from the time Cox failed to meet the agreement; and stated that he was willing to give Cox some additional time to improve its statistics.

There being no objection to the motion, Mayor Clark so ordered.

Councilman Long re-joined the Council meeting.

FY 03-04 Comprehensive Annual Financial Report, Audit Management Letter and Independent Auditors’ Report on Compliance and Internal Control

The staff report of February 1, 2005, directed Council to receive and file the following: 1) the FY 03-04 Comprehensive Annual Financial Report of the City of Rancho Palos Verdes (CAFR); and, 2) Independent Auditors’ Report on Compliance and on Internal Control over Financial Reporting.

Mayor pro tem Wolowicz advised that within the CAFR, there were two certificates in the report recognizing the work included in the financial statement: a Certificate of Achievement for Excellence in Financial Reporting presented to the City of RPV and a California Society of Municipal Finance Officer Certificate of Award for Outstanding Financial Reporting -- highlighting the quality of work done by the finance staff in this City, not only in the accuracy of the numbers, but also with the report and explanations that go along with the report. He stated that the City’s finance staff, under the direction of Director McLean, helped Council and the residents to understand this complicated information. Recognizing the only time this Council sees a balance sheet was at this time, once a year, and six months after the financial statement, Mayor pro tem Wolowicz explained what he and then Mayor Gardiner attempted to do last year was to come up with some reporting structure that would help Council follow the reserve balance in the General Fund; and expressed his belief that they’ve come a long way with a simple form which highlights the significance and importance of understanding the information that’s been presented to Council on an annual basis. He pointed out that another unique thing which was included in these annual financial statements was the fact that it compared to the budget, noting this City was managed by its budget; and he explained his purpose was not to inundate Council with financial issues, but merely to recognize where the information was within these financial statements.

Councilman Long highlighted Page No. 30, GASB Statement No. 42, which indicated this statement also clarified and established accounting requirements from insurance recoveries, including those associated with capital asset impairment; stating that it required recognizing and disclosing the effects of capital asset impairment; and noted this statement was not effective until June 30, 2006. Although it was not effective until June 30, 2006, he questioned if the City could elect to implement it earlier for the City’s own reporting.

Responding to Councilman Long, Director McLean stated the City could implement it earlier, although without having done an analysis as the Finance Director, he had not expected any write-downs of net assets as a result of impairment of capital assets.

Mayor pro tem Wolowicz explained that the footnote being referred to was significantly new to the financial statements and that it was unusual to have this many items in government accounting.

Referring to Page No. 29, Councilman Long stated that this City, as part of the Joint Powers Insurance Authority (JPIA), shared pro rata liability for pooled claims; that as he understood it, the way this City handles this liability was to record the deposits the City was required to make to JPIA as insurance expenses; and he questioned if any concern had been raised at any point in time about any deficit or inadequacy in the JPIA requests for deposits.

Director McLean indicated no.

With regard to Note 8, Insurance, Statement Page No. 41, Councilman Long questioned if staff could confirm whether those numbers vary depending on what the nature of coverage of insurance was, whether it was a deductible per occurrence or per claim.

Director McLean noted for Councilman Long he would have to research that and provide an answer at a later time.

Councilman Long stated that the City’s liability could be substantial if there was a deductible per claim versus single event/occurrence coverage. Councilman Long requested clarification on Note 7.

With regard to actuarial valuation of assets, Director McLean explained that an actuarial professional would consider the participants of the plan, the numbers, their ages, their compensation levels; and that based upon many different factors, they will try to make a determination of the liability, the liability for future retirement benefits, which would then be compared with an evaluation of the plan assets.

Councilman Long noted his understanding that valuation of plan assets was not based on current market value, nor was it based on historical book value costs, acquisition value nor fair market value, but a value of the assets that was based on actuarial assumptions.

Director McLean indicated Councilman Long’s understanding was correct.

Looking at this same footnote, Councilman Long stated that the City could say, based on actuarial value, its pension as of 2002 was 96 percent funded, but the statistic could be different if one looked at the fair market value or the book value.

Mayor pro tem Wolowicz pointed out that this data was not complete, that the actuaries and the California Public Employee Retirement System (CalPERS) was consistently behind in providing up-to-date information, noting the report was missing for two other years – June 30, 2003 and June 30, 2004; and because this information was not up to date, the City was not clear on what its under-funded or over-funded liability might be. Mayor pro tem Wolowicz explained what ultimately happened was the internal accountants and auditors rely on information provided by the pension plan; and he mentioned that because this had been a particularly active week for him with City assignments, he had not been able to read the entire document.

Director McLean explained that CalPERS developed a smoothing approach as a result of the volatility in the marketplace that had occurred over the previous 10 years; and noted that specifically, the intent of the actuarial was to adjust the asset basis for the short-term market volatility gains and losses over a period of five to seven years, rather than adjust asset values or allow asset values to be adjusted by substantial swings in the marketplace in gains and losses experienced.

Councilman Long stated that the CalPERS investment strategy should be what smoothes out the volatility, given that this agency was investing for defined benefit pensions and given the size of those investments. He stated it would be more helpful if Council had more recent data.

Travis Hickey, principal at Vavrinek, Trine, Day & Co, City auditor, thanked the City for its four-year relationship/engagement with his company as the City’s auditor; explained that it was his company’s role to give its opinion on a fair presentation of the City’s financial statements – pointing out that the auditor’s opinion was unqualified and noted that they had no exceptions with the financial data that was presented in the report. Because the audit was for a government agency, he explained that it’s conducted in accordance with government auditing standards, which also required they issue an opinion on their assessment of the City’s internal control over financial reporting and the City’s compliance with applicable laws and regulations.

Mayor Clark inquired as to the approximate number of municipal clients the City’s auditing firm had and asked for further input on the City’s quality of reporting this information.

Responding to Mayor Clark’s inquiry, Mr. Hickey stated his firm had approximately 30 municipal clients; noted the City received an award for its prior year’s Comprehensive Annual Financial Report (CAFR); and advised that the City was required to issue financial statements, but that the extra information in the CAFR was not required, only encouraged. He noted that the information in the CAFR was extra information to give the City’s residents more insight about the City’s finances. With regard to his firm’s municipal clients, he approximated 50 percent do a CAFR; and of that 50 percent, approximately 50 percent of those submit and receive the state and national awards. He indicated that the City of RPV was at the upper level of financial reporting in terms of the annual reports it prepared.

Councilman Long requested that Mr. Hickey explain some of the data in the CAFR and explain the purpose of GASB Statement No. 34.

Mr. Hickey explained that GASB Statement No. 34 was issued in 1999; that the implementation was phased in over a period of years, depending on the size of the city; advised that it was a monumental change in governmental financial reporting; and that among other things, it required a management discussion and analysis which was similar to private sector annual financial reports. He explained that the CAFR always had a transmittal letter, but under the new reporting model, at the very basic level, it must have a narrative overview prepared by management. He noted that the second major change was to make the statements more in line with the way the private sector businesses reported its financial information, on an accrual basis; and he noted that the City’s fund level information was not on that basis and that this, therefore, resulted in a requirement for two new statements: a Statement of Net Assets and a Statement of Activities, which was on the accrual basis at the government-wide level. Along with an accrual basis, he indicated that financial statements required the City to bring in its fixed assets and its long-term debt items, which historically had been excluded from the fund level information; and that through this process the capital asset piece was folded in. He concluded that what was previously in the general fixed asset account group was now just a holding category to accumulate the value of assets the City had acquired over the years; and advised that those assets were transferred into an actual financial statement and depreciated over their useful lives. As a result of implementing that piece of the provision, he noted that approximately two to three years ago, the City hired Harris & Associates to conduct an infrastructure study which calculated historical cost values of the City’s infrastructure; and pointed out that those values, along with the City’s other fixed assets, were now all captured and depreciated on an annual basis.

Mayor pro tem Wolowicz noted that the balance sheet indicated the City’s infrastructure for the current year was $73,500,000 out of total assets of about $130,000,000; and questioned if his understanding was correct that the reason there was no auditor’s letter included was there were no reportable conditions.

Mr. Hickey noted for Mayor pro tem Wolowicz that his understanding was correct, that his firm did not identify any reportable conditions or any levels of material weakness in internal control over the City’s financial reporting.

Mayor pro tem Wolowicz asked Mr. Hickey what had been his recent experience in meeting with City Councils or representatives of City Councils.

Mr. Hickey stated that it varied greatly, from meeting with ad hoc committees, meeting with a couple Council Members and staff, or making a presentation before City Councils, which was not uncommon. He expressed his belief that if there were no issues that need to be communicated to a governing body, he wouldn’t necessarily feel a need to appear before that governing body.

Mayor pro tem Wolowicz requested clarification with regard to Footnote No. 15.

In response, Mr. Hickey explained that the deferred liability to the County of Los Angeles had been a disclosure item in the financial statements since the agreement went into effect in 1997; that as a part of his firm’s annual audit, this is something they looked at every year; advised that his firm’s representatives, along with Director McLean and Accounting Manager Downs, discussed the matter with representatives of L.A. County to discuss this issue; that they believed, based on this new evaluation, this liability was not sufficient enough to only disclose, but that they should actually book the liability; and as a result, the City posted this adjustment and his firm agreed with the City’s evaluation. Because the liability wasn’t present last year, he explained that the City’s net assets were too high; and now that they had included this liability, it had reduced the net assets.

Director McLean stated that $3.1 million of deferred interest was not booked until the current year because when the $3.1 million of deferred interest was recharacterized in 1997 with the restructuring of the RDA funds, the management staff didn’t feel it was going to be paid because at that point in time, no one believed there would be sufficient tax increment to pay not just the RDA funds as scheduled, but deferred interest as well. He added that since 1997 tax increment revenue had grown; and based upon a projection they provided to City Council in September 2004, staff now believed not only will the scheduled bond debt be paid, but also the $3.1 million of deferred interest; and that staff not only disclosed it as a liability, as had been done in the past, staff also booked it.

Councilman Gardiner expressed his belief it was appropriate for the City’s auditor to be present at the City Council meeting to provide a presentation; and he noted his appreciation of Director McLean and his staff for their outstanding work.

On behalf of Council, Mayor Clark expressed appreciation of the Finance Department’s effort; and thanked Mr. Hickey for attending this evening’s meeting and providing input.

Councilman Stern moved, seconded by Councilman Gardiner, to receive and file the CAFR for this year. Without objection, Mayor Clark so ordered.

RECESS AND RECONVENE

Mayor Clark recessed the meeting at 10:01 P.M. and reconvened the meeting at 10:10 P.M.

Proposed Vehicle License Fee Gap Loan Receivable Sale.

Director McLean summarized staff report and advised the Council that the Finance Advisory Committee (FAC) had received the same presentation the previous week; and that the FAC had recommended City Council adopt staff’s recommendation.

Referring to Circle Page No. 4, Mayor Clark asked for staff’s input on the logic for supporting the proposed minimum percentage.

Director McLean explained that as a part of this transaction, the investment banker who had been assigned to RPV had run a spreadsheet; stated that there are 140 cities/counties that have filed applications to participate in this pooled financing program; that the applications represent approximately $380 million as a part of receivable sales and financing; and that based upon those dollar amounts, there were fixed legal costs, which were being spread amongst all participants in this program. In addition, he advised there were credit enhancements, which were being provided to the investment community; stated that there had to be a return provided to the investor; and based upon the calculations provided by the investment banker, it had been suggested that a discount of approximately 10.5 percent should probably be the floor that RPV could expect to realize. He added that staff believes, based upon discussions with the investment banker, that the City was more likely to receive funds in excess of 89.5 percent, perhaps as much as 91 to 92 percent.

Councilman Long asked if staff knew whether the rate of return the City would be receiving would be tax-free.

Director McLean stated that the transaction had been designed to offer a taxable and a tax-free version; advised that the City had chosen the taxable version; and that staff did not know what the rate of return would be for the institutional investors.

Councilman Long questioned why staff chose the taxable return, expressing his belief that the City would end up having to pay a higher yield to the investor.

Director McLean explained that this version was chosen simply to avoid substantial restrictions on the use of the proceeds; advised that the percentage difference was fairly immaterial; and that staff was proposing that the proceeds fund the sale and be deposited into the City’s local area investment fund account and General fund reserve.

Councilman Long questioned whether this would, at least in part, then yield the offsetting 2.13 percent return that offset the discount.

Director McLean indicated yes; and clarified that the 2.13 percent was nothing more than what the City was earning on its LAIF account as of December 2004. He stated that the 2.13 percent was the annual rate; and that staff expects the City would derive the proceeds, deposit them in April 2005, and have them for as much as 60 months prior to the scheduled payment from the state.

Director McLean confirmed for Mayor Clark that the California League of Cities was one of the founders of California Statewide Communities Development Authority (CSCDA) and advised that the City will need to become a member of CSCDA as part of this transaction.

Mayor Clark advised that Rolling Hills Estates (RHE) City Council dealt with this same matter recently; noted that although that city had substantially less VLF gap loan amount at stake, approximately $137,000, versus RPV’s approximately $726,000, RHE had agreed to a floor of 73 percent; noted his presumption that part of the investment banking analysis was one of risk analysis on what RPV can expect overall; and stated that he also understood from watching RHE’s City Council meeting, that the actual mechanism to be used by RPV in the financial market to accomplish this action would be a "Dutch auction," and questioned the meaning of this term.

City Attorney Lynch explained that a Dutch auction was a bid amount that was reduced until it hit the same amount for which the offer was being bid at, and that everything was sold at the same rate.

Mayor pro tem Wolowicz asked if staff booked this receivable and put it on the balance sheet.

Director McLean stated that staff had not included the $726,000 gap loan receivable in the 2004 5-year Financial Model Revision II that was discussed by Council approximately a week earlier.

Councilman Stern moved, seconded by Mayor pro tem Wolowicz, to accept the staff recommendation.

Councilman Stern noted there was no certainty that the state would pay the City in a year and a half and that the payment could linger for years; and stated his belief that the City should enter into this program.

City Attorney Lynch explained that the City basically would establish a minimum amount it was willing to accept for this receivable, and that if the City did not get that amount, the City would then keeps this receivable.

Councilman Long stated that he was reluctantly inclined to support the staff recommendation because the expectation level was high and that there was no huge downside; and stated that he would have preferred 90 cents on the dollar, but that he will defer to those who have more closely studied the issue.

Mayor Clark stated there was no guarantee, the amount paid could go higher; and noted that if the offer was lower, the City could back out of the sale.

Director McLean advised that the investment banker indicated the larger the VLF amount, the smaller the discount because there were certain fixed costs being spread over the entire transaction.

Roll call vote to approve staff recommendation carried as follows:

AYES: Gardiner, Long, Stern, Wolowicz, Mayor Clark

NOES: None

ABSTAIN: None

ABSENT: None

In passing this motion, the City Council 1) ADOPTED RESOLUTION NO. 2005-11; APPROVING, AUTHORIZING AND DIRECTING EXECUTION OF THE JOINT POWERS AGREEMENT TO JOIN THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY; and, 2) ADOPTED RESOLUTION NO. 2005-12; APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF A PURCHASE AND SALE AGREEMENT AND RELATED DOCUMENTS WITH RESPECT TO THE SALE OF THE CITY’S FY 03-04 VEHICLE LICENSE FEE GAP LOAN RECEIVABLE FROM THE STATE, AND DIRECTING AND AUTHORIZING CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH.

Director McLean stated that this had been a demanding transaction to move forward in a very short period of time and he thanked City Attorney Lynch and her staff, as well as Finance staff for bringing this forward to Council so quickly.

On behalf of Council, Mayor Clark thanked City staff and the City Attorney’s Office for their efforts.

Accept Military Dependents at Peninsula Schools

The staff report of February 1, 2005 recommended that Council consider adopting a Resolution asking the Palos Verdes Peninsula Unified School District to open up schools to the children of active military personnel.

Assistant City Manager/City Clerk Petru advised that late correspondence had been distributed to the Council earlier in the evening regarding this matter.

Because he works as a government jurist with the Department of Defense, Air Force, Mayor Clark recused himself from consideration of this matter; advised that he had not encouraged nor advocated this item to be brought to Council; and left the Council Chambers during the consideration of this item.

Councilman Stern moved, seconded by Councilman Gardiner, to adopt the resolution.

Councilman Gardiner pointed out that it was not without precedence for RPV to discuss such matters with the PVP School Board; and explained that there was a series of unique events that were converging which made it a favorable time to bring this issue forward, such as the threat of base closings. He highlighted the importance of the Air Force Base to the economy of RPV and the rest of the South Bay, noting that its closure would have all sorts of negative effects on the entire region. Councilman Gardiner stated one of the things that seemed to influence a BRAC decision was educational opportunities for the dependents of service personnel; and commented on the recent introduction of Assembly Bill 208, which would require school districts to give preference to the children of military personnel in the process of an intra-district transfer. He noted the goal was to help tilt the balance in favor of Los Angeles Air Force Base in the BRAC process by providing greater opportunity for quality education for the children of military personnel; and stated that this was an opportunity for RPV to raise the visibility of this opportunity. He stated that it was also consistent with RPV’s prior support for Los Angeles Air Force Base; and that it was an attempt to encourage the local school district to take a leadership role in this important area. He mentioned that Councilman Long helped to get this item on the agenda. Councilman Gardiner explained that without this bill, military personnel must go through an expensive, lengthy and extremely burdensome process to get their children into the school of their choice; and noted that many military personnel were in one place for only a short period/tour of duty.

Councilman Long echoed Councilman Gardiner’s comments; advised that what triggered his interest, in part, was a discussion he had with some of the officers at the Los Angeles Air Force Base 50th Anniversary celebration about the ability of military dependents to attend PV schools. He joined in urging the school district to take a look at this issue with as favorable an eye as possible; and pointed out that given the circumstances of what was being requested, the reasons for trying to preserve the Los Angeles Air Force Base, and trying to recognize the burdens placed upon military families, especially at the current time, a favorable decision could counter some of these burdens.

Councilman Stern echoed the previous comments of his colleagues.

Councilman Gardiner advised that if the decision were favorable, a representative of the Air Force Base indicated it would create some exciting opportunities for the PVP School District, and he encouraged the School Board to thoughtfully consider whether it could take a leadership position on this issue.

Mayor pro tem Wolowicz stated that he wanted this item on the agenda some time ago; noted that the base was critical to California’s economy; and advised that two states (Colorado and New Mexico) had committed to provide public education accessibility to military personnel dependents. He mentioned that it involved a nominal number of students; and stated that he viewed this as a very significant item, one that was appropriate for Council to take action on that evening. He thanked Councilman Long for getting this item placed on the agenda.

There being no objection, Mayor pro tem Wolowicz so ordered.

Mayor pro tem Wolowicz suggested that the crafting of the letter to the PVP School Board would benefit greatly from Councilman Gardiner’s assistance and he stated he also would participate, if needed.

Councilman Gardiner suggested that all members of Council sign the letter.

Mayor pro tem Wolowicz stated that a representative from Council might follow this matter up in person before the School Board; and agreed that the letter should be signed by the entire Council.

Mayor Clark returned to the Council Chambers.

City Council Meetings and Conferences

The staff report of February 1, 2005, recommended that Council approve an additional allocation of funds for City Council Travel and Conferences; or approve a reallocation of funds among Council Members for Travel and Conferences.

City Manager Evans advised that Council had a travel budget of $22,500; of that amount, $4,500 was customarily allocated to each Council Member; that as far as he knew, the City had never run over the $22,500 budget; but that from time to time, an individual Council Member had run over their individual allocation. He advised that Mayor Clark had utilized his $4,500 allocation for that year, or very close to that figure; and that to complete his anticipated travel schedule for this year, Mayor Clark anticipated that he would need additional money. City Manager Evans expressed his belief that Council as a whole would probably stay within the $22,500 allotment, but it would be close to that figure. He noted that Councilman Gardiner authorized staff to transfer some of his allocated funds to the Community Outreach fund for the City’s holiday reception.

Councilman Long stated that when one of the members of this body was fulfilling a Council obligation and it required more travel, the City Council could and should reconsider the budget allocation; and that while leaving available the funds to other members they reasonably needed for travel, he would support making an additional budget allocation as needed for the member’s participation in things like the League of California Cities and various conferences. He suggested that at this point no change be made to any Council Member’s budget, but to make a change for the Mayor’s budget and increase his ceiling to $7,500.

Mayor pro tem Wolowicz expressed his belief that Council could reasonably do its business within the total budget allocated; and noted his inclination to leave the budget total as it currently stood, but to reallocate some of the funds in order to assist the Mayor in representing both the City and attending other organization’s events on behalf of RPV’s business, and perhaps paring down the individual funds of those Council Members who haven’t spent their funds. He stated that he had seen a significant benefit by having RPV’s Mayors participate in events and keeping RPV informed on various regional and state issues.

Councilman Long explained the difficulty he saw with that option. In his case, he used $2,100 of his allocation, and that, had his schedule permitted, he would have liked to have participated in more events; and noted his concern with a use-it or lose-it system – pointing out that his schedule next year might be more favorable in providing greater opportunities for him to attend conferences. He stated that if a Council Member knows for sure they will not be using their allocated accounts, they can advise staff.

Mayor Clark asked staff when the $22,500 Council travel budget was established.

City Manager Evans stated it was in effect prior to 1996.

Having been established over a decade ago, Mayor Clark suggested that the $22,500 budget allocation for Council travel/training should be revisited to determine if the Council needed to appropriate additional travel/training funds. He commented on the City’s heavy involvement with the League of California Cities and California Contract Cities and reiterated his suggestion that consideration be given to appropriating additional funds to Council’s account according to the needs of the City.

Councilman Stern stated that during his five years on this Council, he did not believe the Council budget of $22,500 had ever been fully used; and expressed his belief there was no need to increase that amount, even considering that the amount had been originally set at least decade earlier. He pointed out that each Council Member had a different desire to travel. He recognized the fact that some Council Members periodically take on additional duties, such as Mayor Clark’s role with the League of California Cities, and stated that it might be appropriate to have a special amount recognizing that additional effort – noting that this would have the same end effect as shifting some of the numbers already allocated. He noted for Councilman Long that $4,500 was available to each Council Member each year, no matter if they reallocated the fund the prior year.

Councilman Gardiner questioned the need to allocate funds to each member, suggesting that the $22,500 be available to anyone on Council who needs the funds to be reimbursed for their travel expenses.

Councilman Stern expressed his belief that putting the money into one fund may create some inequity when one Council Member utilized a larger sum than the rest and the desire for another to attend a conference when no money remains; and he suggested an annual schedule be prepared that laid out the anticipated travel expenditures of each Council Member.

Councilman Gardiner suggested that each Council Member provide the City Manager with their travel plans for the year.

City Manager Evans mentioned that prior Councils never saw a need to raise this budget amount because Council never ran over the $22,500.

Mayor Clark stated that when Council gets into the budget review, he would like to look at each department’s budget to examine actual expenditures to budgeted amounts for successive years.

Mayor pro tem Wolowicz noted his support of Councilman Gardiner’s suggestion for a proposed travel/event itinerary; and reiterated his support for keeping the fund at $22,500.

City Manager Evans noted that he anticipated Council would be close to using the entire $22,500 figure this fiscal year, assuming four Council Members go to the California Contract Cities event in Palm Springs and the Mayor continued his participation in the League’s Taxation Committee meetings; and stated that he needed to know the Council’s interest in attending upcoming conferences.

Mayor Clark encouraged his colleagues to attend the League’s Mayors and Council Members Executive Forum and the League’s Annual Conference; and noted his support for Council providing City Manager Evans with their anticipated travel/event itinerary for the next budget cycle.

Councilman Gardiner cautioned Council to be careful in spending a lot of money on travel, especially when Council was going to be talking about establishing a user fee with the residents. He noted his appreciation of some of the Council Members’ interest in attending various meetings/conferences, pointing out that these events could be very beneficial to RPV. He mentioned that he did not have a lot of interest or time to attend many conferences; and he reiterated the need to provide a travel/event schedule for planning purposes.

Councilman Long stated that conferences offer different value for the attendees; that some conferences are educational in helping Council Members do a better job, while other conferences offer important opportunities to network and share ideas with elected and appointed officials from other agencies.

Mayor Clark mentioned that he brought back an idea from one of the League’s conferences on neighborhood compatibility and, as a result, the City had adopted this concept.

Councilman Gardiner, echoed by Mayor Clark, expressed his belief that multiple members need not attend the same conferences, that the information obtained can be shared.

Mayor Clark expressed his belief that more participation by this Council was needed with the League of California Cities, believing that it would be of benefit to the individual members in terms of performing their duties and responsibilities in addition to bringing back new ideas to the community.

Mayor pro tem Wolowicz moved, seconded by Councilman Gardiner, to leave the current year City Council travel budget at $22,500; allow the City Manager to bring the matter back to Council if an additional budget allocation was required; allow for a reallocation within the exiting budget amount for Mayor Clark, if needed; and for Council to submit to City Manager Evans an estimated travel itinerary for the FY 05-06 budget. There being no objection, Mayor Clark so ordered.

COUNCIL DISCUSSION OF FUTURE AGENDA ITEMS & SUGGESTION OF FUTURE AGENDA ITEMS:

None.

CLOSED SESSION REPORT:

City Attorney Lynch advised that this evening’s closed session item was withdrawn.

ADJOURNMENT:

Councilman Stern moved to adjourn the meeting at 11:05 P.M.

______________________

Mayor

Attest:

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City Clerk