M I N U T E S
RANCHO PALOS VERDES CITY COUNCIL
ADJOURNED REGULAR MEETING
SATURDAY, MARCH 12, 2005
The meeting was called to order at 9:02 a.m. by Mayor Clark at the City Hall Community Room, 30940 Hawthorne Boulevard, Rancho Palos Verdes.
Roll call was answered as follows:
PRESENT: Stern, Long, Gardiner, Wolowicz, Clark
Also present were City Manager Les Evans; Assistant City Manager/City Clerk Carolynn Petru; City Attorney Carol Lynch; Director of Finance Dennis McLean; Director of Planning, Building and Code Enforcement Joel Rojas; Director of Public Works Dean Allison; Accounting Manager Kathryn Downs; and, Minutes Reporter Debra Presutti.
The Pledge of Allegiance was led by Director of Planning, Building and Code Enforcement Rojas.
APPROVAL OF AGENDA:
Councilman Stern moved, seconded by Councilman Long, to approve the Agenda as amended with the addition of a Closed Session item.
Tarapaca Storm Drain
Reviewed and reconfirmed with a 4/5th vote, the City Council’s action on December 21, 2004, to authorize staff to conduct an informal bid process to repair the Tarapaca Storm Drain.
Councilman Stern moved, seconded by Mayor Pro Tem Wolowicz, to approve the Consent Calendar.
The motion to approve the Consent Calendar carried on the following roll call vote:
AYES: Long, Gardiner, Wolowicz, Stern, Clark
REGULAR NEW BUSINESS:
Budget Policy Issues Workshop
City Manager Evans provided a summary staff report and indicated that a very preliminary internal estimate of the City’s revenues and baseline expenditures was being presented. He added that staff was fairly comfortable with the accuracy of the numbers, but would have more accurate information in a few months.
Councilman Gardiner expressed concern at the prospect of going into the General fund reserves, indicating that while he did not mind doing so for certain one-time expenditures, he did not want to see it occur on an ongoing basis. He suggested determining the items that the Council agreed would be funded and the amounts allocated to each, and then determine how much remained for other budget items.
Councilman Long supported Councilman Gardiner’s approach, saying that the ultimate goal was to whittle down the $1.6 million in competing proposals to arrive at an operating budget that was in balance with $1.4 million of available funds. He noted that he would prefer to split the cost of sewer cleaning and videotaping 50/50 into the ongoing and one-time expense categories in Columns A and B of the handout provided by staff. He inquired if the projected revenues included expected additional proceeds from the recent increases in Planning permit fees.
Director McLean answered that some very conservative fee increases were included in the revenue projections.
Councilman Stern agreed somewhat with Councilman Gardiner’s suggested approach, but indicated he that did not necessarily agree with the conclusion that one-time items, depending what they are, should not come out of the operating revenue stream. He indicated that he would prefer not to view the matter as having $14.8 million available for ongoing items with everything else being funded out of the General fund reserves, saying that there may be instances where it was completely appropriate to take certain one-time expenses out of the regular revenue stream.
Mayor Pro Tem Wolowicz commented that he had given some thought to Councilman Gardiner’s proposal and, while not adverse to it, found himself leaning towards Councilman Stern’s suggested on items such as storm drain lining. He queried whether any of the items listed in Column B of the staff handout were included in the City’s Five-Year Financial Model.
Director McLean responded that all items in Columns A and B were included in the Five-Year Model. He advised that the amounts for each line item in the "2005 Budget Policy Issues" category were not included, but the discretionary items such as the Residential Overlay and the Residential and Arterial Slurry were included, saying that those items were intentionally separated in the presentation because they were clearly defined and would provide Council an opportunity to include them or not in the operating column as the FY 05-06 Budget process moved forward.
Councilman Long favored Councilman Gardiner’s concept of attempting to make the operating revenues match the operating budget and suggested setting things aside which the City could not afford at this point and remove the Building Replacement Fund Transfer from Column B, which would close approximately half of a roughly $200,000 gap. He suggested further closing that gap by reexamining the Abalone Cove Sewer District subsidy, carefully scrutinizing the nonprofit organization grant requests, and the proposed Planning Technician and Traffic Engineer positions to determine if there was a way to close the remaining gap by looking at these items collectively.
Councilman Gardiner indicated that he would like to leave the Building Replacement Fund Transfer, but reduce it to $75,000 to hedge against unforeseen events, noting that no contingency funds had been included in the baseline budget and he would like to retain a small amount in the ongoing budget, separate from the General fun reserves, to be used for building repairs, if necessary.
Councilman Stern noted that since the City had a sizable General fund reserve, it might be better to retain six months of revenue, or $7 million, which would leave $6 million of unallocated General fund reserves that could be used to fund some one-time capital projects that would diminish the $6 million over time. He added that he was not certain why a $75,000 contingency should be set aside.
Mayor Clark inquired if the proposed $13.4 million baseline budget anticipated any major outlays for legal expenditure associated with Court rulings such as the Abrams case, saying that he believed consideration should be given to the fact that theoretically the City could be hit with a significant outlay in terms of litigation costs.
Councilman Stern advised that it was unlikely any of the pending legal cases would be decided in the next fiscal year, saying that if the City lost the Supreme Court case, it would return to the District Court for a new trial and, if the City lost that, then it could have serious implications on the Five-Year Model. He advised that the City should not spend down its General fund reserve too far based on the assumption the City will not have to pay any legal settlements associated with these pending cases in the future.
City Grant Requests
Assistant City Manager/City Clerk Petru provided a summary of the staff report.
Jerry Jeffe, President and CEO of the Palos Verdes Chamber of Commerce, indicated that the Chamber was requesting funds over and above the annual dues the City pays to the Chamber, saying the business community was involved in economic development by promoting jobs and attracting and retaining business in the community. He noted that by bringing jobs and employers into RPV, money goes into the City’s treasury thereby allowing the City to provide services to its residents and visitors but, in order for the Chamber to encourage business growth, additional funds were needed. He advised Council that the Chamber would like to focus on developing the businesses along Western Avenue, saying that they could certainly provide much more revenue to the City but the resources to support them have just not been available. He noted that the Chamber would be happy to adjust their focus if the City Council believed there were other more important priorities. He indicated that they were considering hosting more mixers and including a special section in the monthly Peninsula Business Journal that would highlight businesses and activities in RPV, adding that these types of activities required additional funding. He indicated that the City of Lomita had a newsletter listing all the business licenses in their city, which would be another great mechanism for advertising and promoting new businesses to RPV’s residents.
Mayor Clark noted that he had been a major advocate of partnering with the Chamber of Commerce but believed money in the form of grants should be provided to organizations that enhance the quality of peoples lives and helps the downtrodden members of the community. He observed that the Chamber’s membership was comprised of business owners and entrepreneurs and suggested that it might be more appropriate to encourage those businesses that were not members to become involved and those that were members to contribute additional resources to the organization. He indicated that the City currently paid over $2,000 a year in dues and, while he believed economic development was important, he did not believe that these types of interests met the criteria for receiving a grant from the City.
Councilman Long echoed the Mayor’s concerns, saying that the gap in the operating budget may not appear to be large but it was difficult to close and the grant requests alone totaled quite a sum. He remarked that he did not question the value of the Chamber’s activities and function, but endorsed the Mayor’s position.
Mayor Pro Tem Wolowicz indicated he was very supportive of Chamber of Commerce activities, noting were it not for the fact Council was wrestling with an enormous deficit he would prefer to be more aggressive in increasing funding to this organization because it provided a direct benefit to the economics of the City. He remarked these worthy organizations would receiving more funding if it were available, noting that the City’s financial situation was probably going to remain difficult for the next few years.
Councilman Gardiner agreed that there was a $200,000 gap that needed to be closed and, since Council was being asked to spend the City’s residents’ money, it must be spent on their behalf. He indicated that his criteria in deciding to award grant money was to determine how many of the City’s 42,000 residents would benefit by what was being requested, saying that he could not justify spending taxpayers’ dollars on things the taxpayers did not need.
Madelaine Sokolosky, representing the South Bay Chamber Music Society, informed the Council that they produced free concerts featuring world-class artists at the Pacific Unitarian Church in RPV and obtained the majority of their funding from individual contributions to their organization and grants. She noted that grant sources were dwindling, corporate sponsorship had fallen off and, as a result, their funding had greatly diminished. She noted that 60 to 70 percent of their audience comes from the Peninsula and was composed of people from all walks of life – children, older adults, minorities and families. She advised the Council that their organization was entirely run by volunteers with their expenses being devoted solely to compensating the musicians, providing a small remuneration to the church where the concerts were held, and to other necessities like piano tuners. She urged Council to consider funding at their former level of $1,000 but indicated they understood the City’s fiscal needs and would be extremely grateful for whatever support Council deemed to be appropriate.
Karen Carr, representing the South Bay Youth Project, voiced appreciation for the City’s past support and sympathized with Council’s current fiscal dilemma, saying that they were suffering the same situation. She advised Council that their organization provided counseling services delivered by licensed therapists to 149 clients from RPV last year. She indicated that County, State, and Federal grants were currently few and far between, so they were counting on the City’s continued support to be able to offer these services in future years to those families in the community that were traditionally underserved.
Mayor Clark inquired about what type of counseling was provided and by whom.
Ms. Carr explained that a multitude of issues were addressed, such as child and substance abuse, domestic violence, depression, anxiety, and some academic problems since most of the referrals come from the schools. She indicated that they had 70 licensed therapists who provided services as an adjunct to their own private practices, generally charging about $35 an hour which was considerably less than their usual rate.
Libby Aubrey, representing the School of Champions, indicated that she was putting together a pilot program to determine how best to provide assistance to children in RPV and other local cities who have never seen bicycles or engaged in physical activity and who often had absentee parents. She explained that she was producing a fund-raiser to obtain additional funds to purchase equipment that could be taken into the schools to promote and support physical fitness as an adjunct to local mental health programs. She indicated that she had also contracted with Kaiser to do obesity testing on the children. She explained she would like to be able to conduct future physical fitness events on the Peninsula, which could also be televised for broadcast on the City’s new educational channel.
Robert Miller, representing the Chamber Orchestra of the South Bay, advised Council that they were the resident orchestra of the Norris Theater and provided a full season of entertainment, which had sold out regularly for the last six years. He noted that they were a professional orchestra with ticket sales accounting for only about 50 percent of their total operating cost. He requested that RPV continue to provide funding at their previous level.
Marilyn Katherman, representing Dance Peninsula Ballet, advised Council that they were a non-profit ballet company comprised of approximately 25 students from the Peninsula, San Pedro, and Torrance area. She indicated that in addition to making most of their own costumes, they produced three performances a year, and provided an outreach program, which enabled about 300 children to attend performances and experience dance firsthand. She indicated that the City had supported them in the past and that they would be extremely grateful for whatever funding the City could provide.
Recess and Reconvene:
Mayor Clark recessed the meeting at 10:18 a.m. and reconvened the meeting at 10:30 a.m.
Barbara Dye, on behalf of the PVP Chamber of Commerce, advised Council that they were attempting to focus the attention of businesses in the community on issues of concern to the City such as proposals to redevelop the Peninsula Center and getting children from military families into the local school district. She noted that they would be addressing the possible storm drain user fee next month to attempt to get the Chamber to take a position on that issue and were also focusing attention on helping businesses along the Western Avenue corridor.
Mayor Clark reiterated his contention that the City grants program should be focused on helping those organizations that provided assistance to the less fortunate members of the community, saying that he had difficulty with the construct of gifting money to local businesses.
Ms. Dye replied that some of the businesses on the Peninsula could be classified as downtrodden given the fact it was very difficult for them to survive economically on the Peninsula. She reminded Council that local businesses provide revenue back to the City.
Councilman Gardiner remarked that the City of Culver City had roughly the same population as Rancho Palos Verdes but a budget of about $100 million as opposed to the City’s $14- to $15 million. He commented that it might be to everyone’s benefit if the Chamber could find automobile dealerships or other large businesses to locate on Western Avenue.
Mayor Pro Tem Wolowicz voiced his opinion that there was a definite nexus between the City and the Chamber to provide economic development opportunities for businesses in the community. He indicated that many business owners on the Peninsula, even though their businesses were not located within RPV, ultimately benefit the entire community and that he would like to see further conversations along the lines of partnering with them to explore ideas for Western Avenue and other aspects of economic development.
Julie Brown, representing Mothers Advocating Prevention, explained that their mission was to provide a program in the local schools to prevent abduction, abuse, and sexual exploitation of minors by sending educators into the schools to discuss safety tips and guidelines that empower children and enable them to protect themselves. She indicated that they have educated over 3600 students in the past year and provided an Internet expert to the middle schools, saying that this spring their largest expense would be updating their curriculum and refreshing their educators.
Councilman Gardiner inquired if Mother Advocating Prevention received any support from the Palos Verdes Peninsula School District.
Ms. Brown answered that the District was charged $50 each time their organization made a safety presentation, noting that although that this was their main source of income, it did not cover their costs.
Mayor Clark noted that the program appeared to be a definite must for the children in the community and asked why the School District had not embraced it and taken it over.
Ms. Brown replied that it was very controversial because their curriculum touched on the area of sexual abuse. She indicated that the school health curriculum did include safety, but the information was very outdated whereas they are able to provide the most up-to-date and completely age appropriate information. She commented that the main problem with the School District’s providing the program was that it would be taught by the teachers and there was a great deal of opposition to teachers taking on any more responsibilities than they currently had.
Councilman Gardiner inquired if they had asked the District to pay closer to the actual cost of the program, saying that he found it difficult to understand why, with an $8 million a year budget and a recently passed parcel tax to make up for shortfalls in equipment, the District was are unable to fully fund this program.
Ms. Brown noted she was not an expert on the School District’s budget but felt that entirely funding the program would be a nominal cost to them. She indicated she was grateful to the School District for the support they had given the program, saying that the organization’s ultimate goal was to get the information to the children by any means possible and they were extremely fortunate to have a wonderful group of volunteers to help make that happen.
Councilman Stern asked how many volunteers they had and how many presentations were routinely provided.
Ms. Brown answered that they had approximately 30 volunteers and, if the middle schools were included, the program reached approximately 4,000 children.
Brooke McIntyre Tuley, representing South Bay Family Health Care Center, thanked Council for their past support, and noted that RPV had granted funding for many years to provide health services to approximately 100 patients a year. She indicated that they currently provided services for diabetes, heart disease, and cardiovascular problems, that they utilized many volunteers and that 60 to 70 percent of their funding went directly to the providers. She noted that they received some money from other funding streams through Medical as well as very minimal CDBG funds, which she feared may soon be taken away.
Councilman Long asked staff if the City’s CDBG funds had already been committed.
City Manager Evans explained that all of the eligible CDBG funds go to the City’s REACH program for developmentally disabled adults.
Mayor Clark asked if there were any restrictions on whom services were available to and how many of the other 16 cities in the South Bay provided funding to the South Bay Family Health Care Center.
Ms. McIntyre Tuley answered that there were no restrictions on who was eligible to receive services except that they must be uninsured, and that Manhattan Beach, Carson, and Redondo Beach were the only other financial contributors at the moment. She noted that quite a number of patients came from Torrance and, ironically, that city provided no contribution to the health center.
Becky Clark, representing SHAWL (Support for Harbor Area Women’s Lives), thanked the Council for its past support and requested to amend their written request by increasing the amount to $5,000. She noted that despite being located in San Pedro many of their clients come from the Peninsula. She indicated that Federal, State, and County moneys had been cut and indicated that their private funding was typically restricted to specific programs and did not provide for infrastructure needs, such as plumbing, electrical, and furnishings for the shelter. She advised Council that they were desperately in need of beds and other furniture and would be agreeable to restricting the use of any funding the City provided to the purchase of new beds.
Mayor Pro Tem Wolowicz proposed that Council establish a cap for the total amount of grants the City would approve in FY 05-06 and then determine the individual allocations, noting that most of the statements presented that day, as well as those submitted in writing, were truly compelling. He further recommended developing a set of criteria and a prescreening process to help move the grant process along more quickly in the future. He suggested leaving the previous year’s cap in place in light of the financial issues currently confronting the City.
Councilman Long felt some of the grants were so small that the City’s contribution did not make a material difference to the recipient organization, stating that he felt these requests should not be considered. He felt that some of the other requests enriched the quality of life but, unfortunately, did not rise to the level of the City’s responsibility and, as such, his inclination would be to cut the funding level back from 30,000 to 15,000 and to support grants to only four organizations – Peninsula Seniors, South Bay Family Health Care Center, South Bay Youth Project, and Support for Harbor Area Women’s Lives.
Councilman Gardiner indicated that he was unable to determine whether $15,000 or $30,000 was the appropriated funding level without being able to view the complete budget.
Mayor Clark remarked that one of the values the community had recognized was the City’s willingness to support non-profit organizations. He reminded his colleagues that the amount reduced from $46,000 to $30,000 in 2002 due to the uncertainty of the State budget and opined that although it was unrealistic to restore the level of funding provided in 2002, he would be comfortable increasing the amount of funding to perhaps $40,000, noting that the City had $14 million in reserves and, although the reserves would be reduced by other expenditures and needs, the City grant program was an important component of what the Council and the City can do for the community and a number of needy organizations.
Councilman Gardiner stated that he might support increasing the grants to $40,000 if he could determine where the other $10,000 would be coming from, noting that increasing funding in one area required an equal decrease in another.
Councilman Long agreed with Councilman Gardiner, saying that he, too, was unsure of the amount remaining and, because these grants were at least by custom and practice an ongoing expenses, he would like to find a place for them in the operating budget. He indicated that one of the reasons he proposed such a low cap was because he had not yet been able to find a comfortable mechanism to fully close the $200,000 gap remaining in the budget.
Mayor Clark observed that $127,000 was allocated for employee salary increases and asked what that figure was based on.
City Manager Evans indicated it was based on the difference between the 3.12% estimated cost for salary increases that had been included in the Five-Year Financial Model and a proposed employee merit pool, which would allow for employee’s to receive a cost of living increase, plus an additional 3.5 percent for merit increases. He indicated that the amount included in the draft budget for salary increases was approximately 7 percent of the City’s total payroll expenses.
Mayor Clark asked for staff’s rationale for a 7% overall aggregate increase.
City Manager Evans explained that for the last four years the City’s employees had only received a cost of living increase and nothing in terms of a merit increase. He indicated that in most other cities, employees were normally hired in at a lower salary range and, as they gained experience and their talents improve over the years, they were given something above a cost of living increase to reflect their increased value to the organization. He noted that his salary had risen approximately 44 percent in the last seven years, saying other employees had not received the same 44 percent increase, even though their talents had certainly justified more than a mere cost of living increase.
Mayor Clark stated that he thought that within each of the staff professional and paraprofessional job classifications there was a range that an individual could be paid which evolved and changed based on experience, number of years, and merit.
City Manager Evans agreed that for most cities that process was automatic – each year employees were evaluated and if the employee successfully passed their evaluation they were elevated to the next step in their salary range. He indicated that RPV had, unfortunately, been unable to do that since only enough money to provide cost of living increases had been allocated over the last several years and if, for example, Director McLean had done an extraordinary job and was granted a 7% increase, two other employees would get nothing in the way of a salary increase for that year.
Mayor Gardiner supported the inclusion of $127,000 for employee salary increases in the proposed budget, but suggested that the City might consider a system in the future where rather than positions being paid within a large salary range, the position was stepped, i.e. Accounting Manager I, II, and III; so an employee who has been employed for the appropriate period of time and merited being moved to the next step would be promoted and that the funds for those promotions and cost of living increases be included in the budget allocations. He indicated that he would consider those merit increases as bonuses rather than ongoing expenses and suggested the final component would be to perform periodic job analyses to ascertain that the salary levels were consistent with similar jobs in the same sector. He opined that this seemed to him a far better way to administrate wages and salaries.
Mayor Clark asserted that the current system actually acted as a disincentive for employees to remain with the City for any long period of time.
Councilman Stern suggested that this might be an appropriate topic for a separate discussion, saying that he agreed with Councilman Gardiner that the $127,000 was fine for now but that it might be wise to explore the entire structure in the near future to determine whether it needed to be revised entirely.
Mayor Pro Tem Wolowicz stated that while he did not begrudge City staff in the least, he was reminded of the fact that there was also an enormous non-discretionary pension cost built into the budget, saying that he would prefer to look at all the employee issues and benefits contemporaneously to get an idea of the actual total cost. Noting that there was probably not adequate time to do that as part of the current budget cycle, he agreed that a study of the issue was warranted. He requested that the City’s management staff decide on a percentage increase for employee merit and bonus benefits that they believe to be correct, saying that where they spend that money would then be at their discretion. He indicated that the practice of some employees receiving a 7% increase while others get nothing was not unique to RPV. He remarked that he would be willing to accept Councilman Gardiner’s proposal for the moment, including a full study of the matter before it was addressed again, but he would prefer that the management staff return with all employee costs included in a single category when the draft budget was presented to Council.
Councilman Gardiner said he would accept Mayor pro tem Wolowicz’s suggestion as a friendly amendment.
Councilman Gardiner moved, seconded by Councilman Long, to accept the proposed operating budget numbers for Employee Merit and CPI, Employee Bonuses, Tuition Reimbursement, and Employee Health for 2005; and, to direct staff to return to Council with alternative approaches to budgeting for employee compensation. The motion passed without objection.
Mayor Clark commented that RPV had a very committed staff that enjoyed working for the City. He noted that having being around City government for the past 15 years it appeared to him that people tend to move from city to city, saying that it was unrealistic to expect that everyone hired by the City would remain for their entire career. He stated that he was curious to know how much that was factored into the development of local government employee compensation packages. He commented that RPV, obviously, wanted a compensation package that was competitive with other municipalities of equal dynamics, population, challenges, et cetera. While he had often heard that the City would lose its best employees if steps were not taken to improve salaries, he noted that employees will come and go over the years regardless of the salary ranges the City established.
City Manager Evans noted that RPV had been very successful in keeping some extremely good people for long periods of time. He indicated that he made every attempt to put the City’s money where he believed it will do the most good, saying that the City has managed to keep many quality employees because of that, but others who perhaps had not felt they were being adequately compensated, some of whom were also very good employees, had left the City for jobs with other jurisdictions.
Councilman Long suggested moving the discussion forward to City Council Budget and Community Outreach Materials items and then returning to the other items in the order presented in the agenda.
City Council Budget
Councilman Long moved, seconded by Councilman Gardiner, to delete the items for an increased City Council Travel Auto Allowance in the amount of $2,040 and the Additional City Council Travel at $5,000.
Councilman Long indicated that, while these items had merit, he did not believe there was money in the budget for them at this time.
The motion passed by acclamation.
Community Outreach Materials
Councilman Stern asked why the cost for Meeting Expenses in the Community Outreach program was proposed to increase so significantly in FY 05-06.
City Manager Evans indicated that Council had been holding more meetings and including a closed session before nearly every regular meeting, saying that Council was provided with a catered meal each time a closed session was held, which cost nearly twice as much as the cold sandwiches that were provided in the past. He opined that the current set up had been working very well because it eliminated the need to have his assistant or someone else in the office order and pick up the sandwiches and it also alleviated the problem of one Council member or another inevitably getting the wrong meal, which occurred frequently in the past.
Mayor Pro Tem Wolowicz remarked that the change to the catered meals was made before he was on the Council, but that he believed the cost was only slightly more expensive than the cost for the sandwiches. He indicated that if the cost was in fact significantly more, he would be willing to go back to having an administrative assistant or another staff member order and pick up sandwiches.
Councilman Long opined there that there were certain efficiencies to this type of outsourcing, noting that the City was not normally in the business of catering, the meals provided by the caterer were far superior, and he believed the City was receiving much better value for the money. He remarked that out of the $19,525 projected net increase in this budget item, he would be inclined to support the additional allocation for the Annual Holiday Reception, as well as the $5,700 for Meeting Expenses.
Councilman Gardiner questioned how the $5,700 increase was distributed, noting that there were several categories encompassed in that one item, i.e. Mayor/Committee Breakfasts, closed sessions, hosting State Legislators, etc.
City Manager Evans indicated those items alone were not generating the increase, but it was primarily because the Council was meeting so much more often, which required more catered meals to be provided.
Councilman Gardiner remarked that if the driving force behind the $5,700 increase was the meals for the closed session meetings, some other mechanism needed to be found to lower the cost per meeting.
Councilman Stern agreed with Councilman Long, noting that having lived with the sandwiches and salads in the past, he believed the catered meals had been a better value for the money, saying that the quality of the food had been consistently good, everyone was happy with their meal, and Council was able to focus on getting its work done. He commented it may be selfish but he believed Council was better served by keeping the current meal situation because it had been working extremely well.
Mayor Clark concurred, saying that he believed, when considering the overall net cost as indicated by the City Manager, the current approach was much better. He maintained that Council spent hundreds of hours on City business, noting it was not unusual for the Councils representing other cities to be provided a decent meal. He reminded his colleagues that Council members were giving up their dinner time with their families to attend meetings that often do not end until midnight, 1:00 or 2:00 in the morning, adding that he believed the expense was a justifiable one.
Councilman Gardiner noted that it created a certain perception in the community if the Council eliminated a $1,500 grant to a worthy group and increased its own meal expenses by $5,000, saying that, personally, he would rather bring a sandwich to the meetings than create that perception.
Councilman Long moved, seconded by Councilman Stern, to approve the $4,250 net increase for the Annual Holiday Reception and the $5,700 increase for City Council meals and to disapprove all other proposed increases in the Community Outreach budget.
Councilman Stern questioned the proposed increase for commemorative items, such as City photographs, asking if the increase reflected the fact that more items would be given away or that the price per unit had increased.
City Manager Evans explained that the City had been giving out more items in the last few years and that photographs were now being given to people who had received tiles in the past, such as the City’s County and State representatives. He indicated that if Council continued this practice, an increase in this budget item was needed.
Mayor Clark suggested that when the Interpretive Center was reopened, these commemorative items could also be sold in the gift shop, which might generate some revenue and help offset some of the cost of the ones that are given away.
City Manager Evans noted that sales of commemorative items would certainly be offered, but indicated that they had not been a particularly good revenue generator in the past.
Mayor Clark asked if Councilman Long’s motion rejected the other items, or rather deferred them because the timing issue.
Councilman Long responded it would take a good deal of persuasion to convince him that the additional cost for a City flag was justified at this time, but added that he was not opposed to reexamining these items when the City had more funds available.
Mayor Clark declared that he was a great proponent of having an official City flag and noted that at various functions where cities of the state were in attendance a large proportion of them displayed their city’s flag. He reminded his colleagues that a City flag was designed for the City a few years earlier, opining that it was a fundamental thing for a community to have and that it would be nice to use it as a set backdrop when the City launched its new cable television station.
Mayor Pro Tem Wolowicz noted for the record that he would not support any of these additional costs, saying that it was a matter of perception, given the limited funds available.
Councilman Gardiner requested that his vote also be reflected as negative on this item.
The motion passed (3-2) to increase in the Community Outreach program budget for Operating Supplies by $4,250 and Meetings & Conferences by $5,700, with Mayor pro tem Wolowicz and Councilman Gardiner dissenting.
City Manager Evans indicated that although it wasn’t yet finalized, the Sheriff’s Department was estimating that the City’s contract cost for law enforcement services would increase by 7.5% in FY 05-06.
Councilman Gardiner moved, seconded by Councilman Long, to accept the $127,000 estimate for the Sheriff’s 7.5% cost increase.
Mayor Pro Tem Wolowicz endorsed the motion, saying that he believed this item represented one of the basic necessities the City should be providing for its citizens.
The motion passed without objection.
Abalone Cove Sewer System
Councilman Stern moved, seconded by Councilman Long, to approve the inclusion of a $10,700 subsidy for the FY 05-06 operating budget for the Abalone Cove Sewer System.
The motion passed with no objection.
One-Time Capital Improvements to City Park Sites and Facilities and Restoration of an Annual Contribution to the Building Replacement Fund
In an attempt to close the $200,000 gap, Councilman Gardiner suggested accepting the amount presented for Arterial and Residential Slurry, reducing the Residential Overlay to $640,000, funding the non-profits at $30,000, reducing the Building Replacement Fund Transfer to $50,000, and rejecting the new Planning Technician position, but authorizing the new Traffic Engineer position.
Councilman Stern noted the Building Replacement Fund Transfer was a capital item and, as such, the full $100,000 could easily be funded out of the General fund reserve. He reminded the Council that staff believed this transfer was needed to alleviate the possibility of a large un-funded expenditure for building replacement five years down the road and contended that not fully funding it failed to recognize that sooner or later the City would have to use some other fund to replace roofs or other necessary building repairs. He noted that it was essentially a sinking fund, and observed that it was a more accurate way of reflecting how much was actually available in the General fund reserve and what was needed to maintain the City’s building assets.
Councilman Wolowicz suggested creating a separate column on the chart provided by staff to indicate which items might necessitate dipping into the General fund reserve to assist the Council in assessing the aggregate fiscal impact.
Councilman Long agreed that it would be nice to have a sinking fund for building replacement, opining it was an ongoing expense that should come out of the operating budget, not a one-time expense that should come from General fund reserve. He also indicated that he was not inclined to decrease the Residential Overlay even by $36,000.
Mayor Clark concurred with Councilman Long, saying that the street pavement master program was devised over many years and included a maintenance cycle that was necessary to keep the City’s roads in good condition. He reminded his colleagues that the program had been cut back over the past few years in response to the State’s budget issues, saying that the Residential Overlay was a significant part of the program and was probably more important than the slurry seal component.
Director Allison agreed with that assessment.
Councilman Long moved to fully fund Residential Overlay and Residential and Arterial Slurry, declaring that he felt strongly enough about those items that he would eliminate all grant funding if necessary to fully fund these two infrastructure programs.
Mayor Clark noted that the City had placed a great deal of emphasis on traffic and safety in recent years and, consequently, a mounting workload had been created and staff had indicated that they needed a new position in the Public Works Department to help process the workload.
Councilman Long explained that before he approved the new Planning Technician position, he wanted to reexamine the City’s Planning fee increases to determine if there was some way to fund a portion of that position with the additional revenue.
Mayor Clark asked if the City had realized any salary savings from the recent retirement of the City Clerk.
City Manager Evans advised Council that when the City Clerk retired, her job duties were divided between the remaining staff in the Administration Department, rather than refilling the position. As a result, the City would be saving approximately $90,000 per year in salary expenses.
Mayor Clark inquired if the $90,000 savings created by the previous City Clerk’s retirement was accounted for as an offset against the proposed additional staff costs.
City Manager Evans indicated that to his knowledge the salary for the City Clerk position had not been taken out of the baseline budget.
Mayor Clark asserted that this savings should be taken into account since a portion of staff costs have been netted out and increases were being proposed.
Councilman Long noted that the Planning Technician position could be absorbed and there would still be funds remaining, if the previous City Clerk’s $90,000 salary was actually still in the baseline budget.
Mayor Pro Tem Wolowicz inquired if the impact of the Cost Based Fee Study was taken into account in estimates included in the Five-Year Model.
Director McLean explained that some estimated revenues generated by the new fee increases were included, adding that those estimates were very conservative.
Councilman Stern, noting that the staff report indicated that the time required to conduct Neighborhood Compatibility Reviews had increased from 150 to 178 days, opined that that this equated to a hidden tax on the applicant. He inquired if the process was taking six months because it was too cumbersome or because the Planning Department was understaffed, saying that he would be very distressed to learn that the City was not staffed adequately to meet the needs of those with whom it conducts business.
Director Rojas explained that the Neighborhood Compatibility Review process was extremely time consuming, saying that it was not because the Planning Department was understaffed, but was simply a matter of how long the process actually took to complete. He explained that it had become a more thorough and detailed process, involving field studies to evaluate the neighborhood and the examination of redesigns in conjunction with public input and the Planning Commission hearing process. He indicated that over the past several years, the percentage of cases had grown to the point where the planners needed to spend more time in the field assessing the neighborhoods, saying that the new position was an attempt to provide a staff members at the public counter in order to allow the other planners more time to go into the field to perform the necessary assessments.
Mayor Pro Tem Wolowicz and Mayor Clark agreed that it would be prudent to include a new Planning Technician position.
Councilman Long noted his tentative dissent. He stated that he believed that a portion or perhaps the entire cost of the Planning Technician position could be paid for out of additional Planning fee increases and recalled that an average of only 47 percent of Planning costs were being recovered even with the fee increases recently approved by the City Council. He asserted that before he would vote in favor of using this source to pay for the new Planning Technician position, he would like to ascertain whether that position could be funded by increasing the fee recovery percentage.
Mayor Clark observed that the fee structure was only recently adjusted and asked Councilman Long if he felt comfortable adjusting it again so soon.
Councilman Long replied in the affirmative, saying that 47 percent was a low recovery rate and, had Council known a Planning Technician was needed, an higher adjustment in the Planning fees might have been addressed earlier.
Mayor Clark noted that the $90,000 savings from not refilling the City Clerk’s position actually equated to a savings of $120,000 when employee benefits were included in the amount.
Mayor Pro Tem Wolowicz remarked that he saw merit in Councilman Long’s position, saying that according to the study included in the February 15th materials, the City had moved from a 21 percent to a 27 percent cost recovery, or from eighth to sixth among the other cities included in the study.
Councilman Long proposed reconsidering the item at the next possible opportunity.
Mayor Pro Tem Wolowicz moved, seconded by Mayor Clark, to include the Planning Technician in the baseline budget and directed staff to present a proposal for increasing Planning fees in order to improve the amount of cost recovery.
Councilman Gardiner stated that he could not support the motion in its current form, saying that he would like to amend it to include direction to staff to determine how much of the $46,000 for the new position could be recovered by adjusting the fees and would move that money into the Building Replacement Fund Transfer.
Councilman Long seconded the proposed amendment to the motion.
Mayor pro tem Wolowicz indicated he would accept that amendment, saying that was the intent behind his original motion. He further suggested increasing the Building Replacement Fund Transfer to $100,000 and including it in operating budget, recognizing there would be some savings generated by the proposed fee increases.
Councilman Long agreed, that saying he would move that amount from the one-time column back into the operating budget and, if a large enough savings was not realized by the increased fees, a negative figure can be acknowledged and the money could be reallocated.
The City Council unanimously approved the following adjustments to the FY 05-06 budget: 1) Creating a new Traffic Engineer position in the Public Works Department; 2) Removing of the fully burdened cost of the Director of Administrative Services’ salary from the baseline budget; 3) Creating a new Planning Technician position in the Planning, Building and Code Enforcement Department; and 4) Changing the $100,000 transfer to the Building Replacement Fund from a one-time expenditure to the operating budget.
Recess and Reconvene:
Mayor Clark recessed the meeting at 12:31 p.m. and reconvened the meeting at 12:45 p.m.
City Grant Requests
Mayor Clark directed the Council’s discussion back to the grant requests and suggested that the Mayor Pro Tem and Assistant City Manager work together and bring back a recommendation to Council on how to allocate $30,000 among the grant applicants.
Councilman Stern advocated funding the grants at the previous year’s level, saying that he would exclude the Salvation Army Sage House, which did not make a request for FY 05-06, and the School of Champions, which would reduce the total grant amount from $30,000 to $29,500.
Mayor Pro Tem Wolowicz maintained that he would like to grant some amount to the Peninsula Chamber of Commerce.
Councilman Long declared he would only support funding for Peninsula Seniors at $7,000; South Bay Family Health Care Center at $3,000; South Bay Youth Project at $2,500; and, SHAWL at $2,000. He requested that his opposition to funding any of the other grants be duly noted.
Mayor Clark indicated that he was unable to support Councilman Long’s position.
Mayor Pro Tem Wolowicz proposed that each of his colleagues provide a list of the organizations they would support, to the Assistant City Manager/City Clerk, so that he could work with her on a composite for funding up to $30,000.
Mayor Clark supported the Mayor Pro Tem’s proposal.
Councilman Gardiner endorsed Councilman Stern’s suggestion.
Mayor Pro Tem Wolowicz indicated that he would go along with Councilman Stern’s idea, reiterating that he still favored including something for the Peninsula Chamber of Commerce to assist in their efforts to promote and support businesses in the City and along the Western Avenue corridor.
Councilman Gardiner opposed giving the Chamber any more money than the annual dues the City already contributed.
Mayor Clark and Councilman Long concurred with Councilman Gardiner.
Mayor Clark returned the discussion to Councilman Stern’s recommendation.
Councilman Long restated his opposition, noting that he would stand by his position.
Mayor Clark noted that Council by a margin of 4 to1 favored supporting funding at the previous year’s level, excluding the Salvation Army Sage House and the School of Champions.
Councilman Wolowicz advised that each organization was required to submit 501( c) (3) documentation along with their most recent tax return or financial statement so that staff could verify that the organizations receiving grants from the City were in fact non-profit organizations.
Councilman Stern suggested including in the City’s future grant solicitation letters a request that those items be submitted ahead of time, so all information could be verified before the Council considered the grant requests.
Councilman Long agreed and suggested that staff work with Mayor Pro Tem Wolowicz to include some pertinent questions such as what percentage of the grant money goes to provide services as opposed to salaries, et cetera.
The Council approved the inclusion of City Grants to non-profit agencies in the South Bay area in the amount of $29,500, with Councilman Long dissenting.
One-Time Capital Improvements to City Park Sites and Facilities and Restoration of an Annual Contribution to the Building Replacement Fund
Mayor Clark returned the Council’s discussion to the remaining budget issues associated with this item.
Assistant City Manager/City Clerk Petru advised Council that late correspondence on this item had been previously distributed.
Councilman Gardiner asked if description on the Agenda would allow the Council to discuss each of the seven remaining items in the one-time expenditure Column C.
City Manager Evans advised that Council would be discussing some major draws on the General fund reserve at the meeting on March 15th and suggested deferring discussion of these other items until those decisions had been made.
Councilman Gardiner voiced support, saying that everything included on the Agenda was represented in Column B, but not in Column C, of the chart provided by staff, leaving Council without the benefit of the entire budgetary picture. He declared that he would prefer to postpone discussion of these items until everything was fully delineated.
Mayor Pro Tem Wolowicz indicated that some of the remaining items involve safety concerns and requested that staff prioritize those items and recommend which ones should definitely be included in the budget. He remarked that when he saw items that involve public safety, such as replacing bluff top fencing, he believed they should be addressed immediately to preclude any liability issues.
Picking up on Mayor Pro Tem Wolowicz’s comment, Councilman Gardiner noted that he would be willing to consider and vote to approval the replacement of the bluff top fencing at the Point Vicente Interpretive Center and Abalone Cove Shoreline Park.
Councilman Gardiner moved, seconded by Mayor Pro Tem Wolowicz, to approve the inclusion of funds to replace the bluff top fencing at the Point Vicente Interpretive Center and Abalone Cove Shoreline Park in the amount of $150,000. The motion passed without objection.
CLOSED SESSION REPORT:
This item on the addendum to the agenda was canceled due to the absence of some of the property negotiators.
Mayor Clark formally adjourned the meeting at 1:02 p.m. to 6:00 p.m. on March 15, 2005 for a Closed Session, immediately followed at 6:30 p.m. by an Adjourned Regular Meeting to conduct interviews for City Advisory Boards.