08-11-1998 Council MinutesAPPROVED BY THE CITY COUNCIL ON AUGUST 25, 1998
CITY COUNCIL MINUTES ORANGE, CALIFORNIA
OF A REGULAR MEETING August 11, 1998
The City Council of the City of Orange, California convened on August 11, 1998 at 4:30 p.m. in
a Regular Meeting in the Council Chambers, 300 E. Chapman Avenue, Orange, California.
4:30 P.M. SESSION
1. OPENING
1.1 INVOCATION
Pastor Carl Floyd, Orange Christian Assembly
1.2 PLEDGE OF ALLEGIANCE TO THE FLAG
Led by Mayor pro tem Slater
1.3 ROLL CALL
PRESENT -Murphy, Slater, Mayor Coontz, Spurgeon, Alvarez
ABSENT -None
1.4 PRESENTATIONS! ANNOUNCEMENTS! PROCLAMATIONS
Plaques were presented in recognition of the Corporate Partners responsible for the
success of Uncle Sam's July 3rd Celebration at Kelly Stadium. Approximately 8,500
people attended the event, which raised over $9,000.
Detective Joe Dupuis presented a plaque in recognition of the sponsors and contributors
in the community for their support of the Orange Police Department World Police & Fire
Games Team. Recognized were Mayor Coontz, Councilman Murphy, Councilman
Spurgeon, County Supervisor William Steiner, and former Councilman Fred Barrera.
Representatives from Edison International, Ferguson, Praet & Sherman, Orange Disposal
Service, Orange City Firefighters Association, Caseys, Bergen Brunswig Corporation,
Orange North Rotary, Kinney Chiropractic, Toyota of Orange, Watsons Soda Fountain,
Varco International, Thompson Building Materials, Titan Automotive, Orange
Alternator, Youngs Markets, and Mitsushiba International were recognized.
2. PUBLIC COMMENTS
Cindy Groom, 303 E. Everett Place, spoke regarding the impact of Chapman University
student parking between Everett and Mayfair. She requested Parking Permit Area A be
extended to include both sides of the street south of Everett to Mayfair. Mayor Coontz
noted that a Mayor's Hotline call was received on this issue.
Mayor pro tern Slater asked what the process would be if Council were to consider the
request. The City Attorney indicated that a fee would be required before the parking
permit application is processed; the request would be to have the fee reimbursed; and the
PAGE 1
CITY COUNCIL MINUTES August 11, 1998
2. PUBLIC COMMENTS (Continued)
Council would have to authorize the fee waiver. Mayor Coontz noted the issue of
parking for the Chapman University students has come up before and there needs to be
further discussion with Chapman University. It is hoped the parking permit could be
included with the tuition. At the suggestion of Councilman Murphy, Mayor pro tern
Slater asked that this issue be agendized for the September 8th Council meeting.
Carole Walters, (address on file), asked if the remodeling of City Hall went out to bid?
Where are the permits? How was the asbestos removed? How was it taken out? Were
the employees and residents safe at the time it was removed? The City Manager
responded the City is not required to pull permits for its own structures. A report is being
prepared which will be provided to Council in Executive Session regarding the bidding.
Norm Phillips, 348 Redwood, spoke regarding the cable franchise fee. He requested an
answer to his question relative to rescinding or lowering the 5% tax paid to Time Warner.
Mr. Phillips asked for a calendar that indicates City Hall Friday closures. Mayor Coontz
responded at the July 28th Council meeting it was requested that Council be provided with
a copy of a recent press release which explained the cable fees. She requested the report
be agendized for the August 25th Council meeting. The City Manager responded the
calendar of Friday closures is now available and will be more widely disbursed.
Pelayo Pelayo, representing Danny Kaye's in Orange, 1096 N. Main Street, and a
representative from Paul's, 207 W. Chapman, requested the enforcement of the smoking
ban in the City of Orange be agendized. Other establishments do not follow the law and
have an unfair advantage. The City Manager responded this is a Department of Health
Services issue. The Police Department has an operational procedure to follow when
complaints are received. Mayor Coontz suggested sending information to the
establishments advising them that the Police Department will respond to complaints
received. The City Manager indicated he would discuss this with Interim Police Chief
Romero. Mayor pro tern Slater asked that a letter be sent to the Department of Health and
Human Services to make them aware of the lack of compliance problem in the City and
suggested the Police Department bicycle team be made aware of the problem. (C2500.K)
3.CONSENT CALENDAR Tape 1055
3.1 Declaration of City Clerk, Cassandra J. Cathcart, declaring posting of City Council
agenda of a regular meeting of August 11, 1998 at Orange Civic Center, Taft
Branch Library at 740 E. Taft Avenue, Police facility at 1107 North Batavia, the
Eisenhower Park Bulletin Board, and summarized on Time-
Warner Communications, all of said locations being in the City of Orange and
freely accessible to members of the public at least 72 hours before commencement of
said regular
meeting.ACTION: Accepted Declaration of Agenda Posting and authorized its retention as
a public record in the Office of the City
Clerk.PAGE
CITY COUNCIL MINUTES August 11, 1998
3. CONSENT CALENDAR (Continued)
3.2 Request Council Confirmation of warrant registers dated July 23, July 28, and July
30,1998.
ACTION:Approved.
3.3 Request approval of City Council Minutes, Regular Meeting, July 28, 1998.
ACTION:Approved.
3.4 Consideration to waive reading in full of all ordinances on the Agenda.
ACTION:Approved.
AGREEMENTS
3.5 Serrano Avenue Maintenance Agreement. (A2100.0 AGR-
3088)SUMMARY: The Mabury Ranch Homeowners Association has requested
enhanced landscape installation in the newly installed median on Serrano Avenue between
Cannon Street and Orange Park Boulevard. This agreement will require the Mabury
Ranch Homeowners Association to maintain the enhanced landscape improvements except
for the median trees which will be maintained by the
City.ACTION: Authorized the Mayor and City Clerk to execute agreement on behalf of
the
City.FISCAL IMP ACT: This agreement will require the Mabury Ranch
Homeowners Association to pay all costs of maintaining the enhanced landscaping. The median
trees will be maintained as part of the City's regular tree trimming
program.3.6 Professional Services Agreement with AKM Consulting Engineers for
the preparation of plans, specifications, and estimates for the construction of
Water Reservoir No. lOA. (A2100.0
AGR-3087)SUMMARY: The Water Division of the Public Works Department
has reviewed proposals for Design Engineering Services from four engineering firms.
This future reservoir is located in Serrano Heights, east of Cannon Street and north of
the proposed extension of
Serrano Avenue.ACTION: Approved agreement with AKM Consulting Engineers in the
amount of 38,616 for the preparation of plans, specifications, and estimates for the
construction of Reservoir No. lOA, and authorized the Mayor and City Clerk to execute on behalf
of
the City.
CITY COUNCIL MINUTES August 11, 1998
3. CONSENT CALENDAR (Continued)
FISCAL IMPACT: Engineering for Water Reservoir No. lOA is funded in 1998-
99 Budget Account No. 601-8041-484201-8318,
Reservoir lOA, $60,000.
REMOVED AND HEARD SEPARATELY)3.7 Hinderliter, de Llamas and Associates (HdL) to
provide Business License software and Sales Tax Audit and Information
Services. (A2100.0 AGR-3086)NOTE: Councilman Murphy abstained on this item due to
a
potential conflict with his employment.SUMMARY: The Finance Department solicited proposals
from software firms to replace the existing 15-year-old Business License system
that is not Year 2000 compliant. The software evaluation performed by the
Finance Department and BRC determined that the software proposal submitted by Hinderliter,
de Llamas and Associates by far surpassed other proposals. A key feature of the software is to
enable city staff to integrate sales tax information with business tax data. In analyzing the City'
s options in the area, it was determined that it would reduce its existing
auditing costs by also contracting
with HdL for sales tax auditing services.FISCAL IMP ACT: Funds in the amount of $
30,000 are currently budgeted in Account No. 100-1221-426700
for the software procurement. Adequate funds for sales tax
auditing are available
in Account No.
1 00-2151 00.MOTION - Spurgeon SECOND -
Slater
AYES - Slater, Mayor Coontz, Spurgeon, Alvarez ABSTAIN-Murphy Approved an agreement with HdL
to provide business license software services in the amount of $22,550; approved an
agreement with HdL to provide sales tax consulting services; authorized Mayor and City Clerk
to execute agreements on behalf of the City;and adopted Resolution No. 8988 - A Resolution of
the City Council of the City of Orange authorizing the
examination
of Sales and Business Tax Records.
BIDS REMOVED AND HEARD SEP ARATEL Y)3.8 Approve plans and specifications
and authorize advertising for bids for Chapman Avenue widening, south side from 5S
Freeway to Yorba Street. (S4000.S.7)SUMMARY: Plans and
specifications have been completed for Chapman Avenue widening, south side from 55 Freeway to Yorba
Street and Chapman Avenue Bus Bay -south side east of Yorba Street. The project is ready
to be advertised for bids. The
estimated construction
CITY COUNCIL MINUTES August 11, 1998
3. CONSENT CALENDAR (Continued)
FISCAL IMP ACT: Funds are budgeted in the Capital Improvement Program and
available in the following account: 500-5011-483300-3023 $190,
000 (Orange
County Transportation Authority).Discussion: Mayor pro tem Slater requested staff consider the installation
of street trees in the parkway areas, ifit would not jeopardize the project. The Director
of Public Works indicated the area will be reviewed to determine if there is sufficient
space, but doubts that it would be feasible because of the restricted sidewalk width due to
the proximity of the edge of the landfill. Trees planted behind the sidewalk would be over
the landfill and have limited potential for long term survival. Approximately 10-12
feet of
widening will
take place.
MOTION- Slater SECOND- Murphy AYES - Murphy, Slater, Mayor
Coontz, Spurgeon, Alvarez ACTION: Approved plans and specifications and authorized
advertising bids for Chapman Avenue widening, south side from 55 Freeway
to
Yorba Street.CONTRACTS 3.9 Contract - Bid No. 978-53; SP-3221;
Various CDBG Construction
Projects.A2100.0 AGR-3085)SUMMARY: This project will provide reconstruction
of the following streets: Adams Avenue (from Tustin Street to 1000' east), Wayfield Street (
from Walnut Avenue to Palm Avenue), Mount Vernon Avenue (from Wayfield Street to 150'
e!o Park Lane), Park Lane (from Mount Vernon to Sycamore Avenue), Martha
Avenue (from Park Lane to 300' east), Emerald Drive (from
Cherry Avenue to Walnut Avenue).ACTION: Approved contract in the amount of $469,068.
15 with All American Asphalt and authorized the Mayor and City Clerk to execute
on behalf of the City.FISCAL IMP ACT: Funds are budgeted in
the Capital Improvement Program and available in the following
account: 310-9645-
483300-1821 $557,829 (Community Development
Block Grant).REMOVED AND HEARD SEP ARATEL Y)3.10 Contract - Bid No. 978-52;
Street lighting modifications
in the Old Towne area.A2100.0 AGR-3084)NOTE: Mayor pro tern Slater abstained on
this item due to a property interest that would be impacted by the project.
Councilman Alvarez abstained due to
a property
CITY COUNCIL MINUTES August 11, 1998
3. CONSENT CALENDAR (Continued)
SUMMARY: Three street lighting improvement projects in the northeast and northwest
quadrants of Old Towne and the intersection of Chapman/Center will improve the
lighting and safety in the project areas.
FISCAL IMP ACT: With the requested allocation of funds, there will be sufficient funds
to pay for the construction contract and the equipment purchase for all three projects as
depicted in "Exhibit A" attached to the staff report.
Discussion: Carole Walters, (address on file), commented that for safety reasons there
needs to be street lights at Center and Walnut. The Director of Public Works explained
that intersection safety lighting is a high priority. The intersection of Center and Walnut
will be considered in future funding.
MOTION - Spurgeon SECOND -
Murphy AYES - Murphy,
Mayor Coontz, Spurgeon ABST AIN- Slater,
Alvarez Move to accept
the bid submitted by High-Light Electric in the amount of $284,800.00 and reject
all other bids.MOTION - Spurgeon
SECOND - Mayor Coontz
AYES - Murphy, Mayor Coontz,
Spurgeon ABSTAIN- Slater, Alvarez Moved to
authorize the Mayor
and City Clerk to execute the contract on behalf of the City, pending approval of street
lighting fixtures by the State's Historic Preservation Officer.MOTION - Spurgeon SECOND - Mayor
Coontz
AYES - Murphy, Mayor
Coontz, Spurgeon ABSTAIN- Slater,
Alvarez Moved to appropriate $65,000
from unappropriated reserves
in 284 Fund (TSIP Area B)into a new account number 284-5032-483100-
1818 (Street Lighting in the Northwest Area of Old Towne).PAGE
6
CITY COUNCIL MINUTES August 11, 1998
3. CONSENT CALENDAR (Continued)
3.11 Contract - Bid No. 978-54; Project D-128; Sacramento Street Storm
Drain Improvement. (A2100.0
AGR-3083)SUMMARY: This project is Phase II of the Milford Street Storm Drain
which, when constructed, will minimize storm water east of the Route 55 Freeway
from cascading westerly across town. This project is in conformance with the Master Plan
of Drainage adopted by the City Council on March 25, 1997. The storm drain will be
on Sacramento Street from Walnut Avenue to
Collins Avenue.The bid opening was held on July 15, 1998. Five formal bids were received
for this project ranging from $1,375,673.00 to $2,397,783.00. Paulus Engineering, Inc.
was the apparent
low bidder.Paulus Engineering, Inc. has claimed two mistakes in their submittal
and requested withdrawal from consideration for award of the contract. Their request does not
meet the requirements of the State Public Contract Code that allows relief
of bidders.ACTION: 1) Denied Paulus Engineering's request to withdraw its bid; 2)
accepted Bid No. 978-54 in the amount of $1,375,673.00 from Paulus Engineering,
Inc., 2871 E.Coronado Street, Anaheim, CA 90630 and authorized the Mayor and
City Clerk to execute the contract; and 3) transferred $320,000 from
account number 530-5011-483400-5336 to account number
530-5011-483400-3433 for Sacramento Street Storm Drain
construction cost, engineering contract administration cost, and contingencies.FISCAL IMP ACT: Funds are
budgeted in the Capital Improvement Program and are available in
the following accounts: 530-5011-483300-3433 $1,190,622 (
Drainage District Fund), 530-5011-483400-3433 $320,000 (Drainage District
Fund - Transfer
from Account 530-5011-483400-5336 - St. James Avenue - Santiago to Orange-Olive Storm Drain).
3.12 Contract Change Order No.1 for Bid
No. 978-24, Project No. SP-3226, 1997-1998 ADA Wheelchair Access
Ramps, Various Locations. (A2100.0 AGR-3002)SUMMARY: This Final Contract Change Order
authorizes payment for the increase in the quantities of sidewalk, curb and gutterremoval
and construction of access ramps beyond the original scope of work. The total contract cost is $
99,176.48.ACTION: Approved final Contract Change Order in
the amount of $12,241.28 to C. J.Construction, Inc. for the additional
quantities at contract unit prices.FISCAL
IMP ACT:
CITY COUNCIL MINUTES August 11, 1998
3. CONSENT CALENDAR (Continued)
3.13 Contract Change Order No.2 for Bid No. 978-28, Project No. SP-
3219, 1997-1998 Street Maintenance Project, Main Street and Orangewood Avenue. (
A2100.
0 AGR-3000)SUMMARY: This Contract Change Order will authorize payment for
increases in the final as-built quantities resulting from a substantial increase
in the removal and replacement of damaged pavement caused by an unusual
amount of inclement weather.ACTION: Approved Contract Change Order in the amount of $8,
088.67 to Calmex Engineering Inc. for the additional quantities
at contract unit prices.FISCAL IMPACT: Funds are budgeted in
the following accounts: 272-5021-483300-4027 $4,044.33 (Gas Tax), 272-5021-
483300-4028 $4,044.34 (Gas Tax). Total
funds available for the project are $8,088.67.3.14 Concurrence
with the County of Orange Public Facilities and Resources Department in award of seismic
retrofit contract for three City bridges. (S4000.S.7)SUMMARY: The County of
Orange has received bids and is requesting City's concurrence with bid results and award
of the contract to the low bidder for seismic retrofit construction of the three bridges
over the Santa Ana River at Garden Grove Blvd.,Orangewood Avenue and Ball
Road (Taft Avenue) for this work. The City
executed City-County Agreement No. D97-073, on August 19, 1997.ACTION: Approved
concurrence with the County's bid results and award of the construction contract for seismic
retrofit of the three bridges over the Santa Ana River
at Garden Grove Blvd., Orangewood Avenue and Ball Road (Taft Avenue).FISCAL IMPACT: No known
impact on budget at this time. Project costs are paid for through a State (11.
43%) and Federal (88.53%) funding program for seismic retrofit of local bridges. The County
Engineer's estimate for this project is $733,
718.00 for construction and $73,500.
00 for construction
management.3.15
CLAIMS FOR DAMAGES: (
C3200.0)a. Dixie Lee b. John Monteleone FISCAL IMPACT: None.ACTION:
Denied claims
CITY COUNCIL MINUTES August 11, 1998
3. CONSENT CALENDAR (Continued)
RESOLUTIONS
3.16 RESOLUTION NO. 8991
A Resolution of the City Council of the City of Orange upholding the recommendation of
the Planning Commission of the City of Orange and granting an accessory second
housing unit upon property located at 904 East Rose Avenue. (C3300.0 CUP-
2196-97)
ACTION: Approved.
UNCOLLECTIBLE RECEIVABLES REMOVED AND HEARD SEP
ARATEL Y)3.17 Write-off of uncollectible
receivables. (C2500J.1)SUMMARY: As part of closing the Fiscal Year's financial
records, Council annually approves the write-off of individual uncollectible receivables in
excess of $75.00.FISCAL IMP ACT: There will be no impact on the
budget. Revenue estimates take into account
projections for uncollectible receivables.Discussion: Barbara DeNiro, (address on file), asked why there
are no Fire Department and paramedic write-offs. Is accounting available for
a comparison from past years?She requested to see some comparisons. The
Finance Director explained an outside service now handles the paramedic billing operation. Money
received by the City from Whitman Billing Services is recorded as a revenue and not
a receivable. A more detailed explanation was provided in the staff report presented to
Council last year. The City Manager indicated the next Paramedic Program report
is anticipated in November or December. There has been an up to 84% collection
rate for paramedic fees. Privatizing the collection service has been found to be cheaper and
more productive than
having City
staff to
it.MOTION- Spurgeon SECOND- Alvarez AYES - Murphy, Slater,
Mayor Coontz, Spurgeon, Alvarez ACTION: Authorized the cessation of formal collection
efforts and approve the write-off of accounts receivable as follows: Utility
Bills $27,617.25/
General Receivables $
4,439.56.
MOTION- Slater SECOND- Mayor Coontz AYES - Murphy, Slater,
Mayor Coontz,
CITY COUNCIL MINUTES August 11, 1998
3. CONSENT CALENDAR (Continued)
Item Nos. 3.7, 3.8, 3.10, and 3.17 were removed and heard separately. Councilman
Murphy abstained on Item No. 3.7. Mayor pro tern Slater and Councilman Alvarez
abstained on Item No. 3.10.
END OF CONSENT CALENDAR
4.REPORTS FROM MAYOR COONTZ Tape 1475
4.1 Update on CalTrans sign age for Old Towne Orange.
Mayor Coontz reported that the State is developing a new policy that will allow Old Towne
Orange and other historic downtowns throughout the State to receive freeway signage to direct
visitors to their communities. The decision was that the signage would be placed on the 22
Freeway. A formal Resolution will come before Council at the August 25th meeting.
4.2 Status of the Trash Investigation and typical questions from the community.
C2500.M.1)
Tape 1581
Mayor Coontz: "I hope this series of questions and answers will help clear the air on a number
of issues. We should not be surprised at the confusion, conjecture and misinformation that
surrounds the trash investigation. I decided to do my best to set the record straight after a brief
conversation with a leader in another city, who said, Why, that's what I read in the paper! He
may have misread it, but then, perhaps the information might have been wrong."
Question: What is the City doing?
Answer: The City has taken a number of steps to protect its interests and to identify all
possible losses.
1. The City hired a forensic accountant, a specialist in fraud, who has been working with the
District Attorney for the past year.
2. Three Orange police officers, highly experienced in fraud investigation, have also been
working full-time on the investigation for nearly a
year.3. We required ORRS, our recycling contractor, to deposit $1 million in an escrow
account to satisfy any losses to the City by fraud. ORRS has additionally credited the City
with approximately $500,000 believed to have been
misappropriated.4. The District Attorney is working to secure property and cash to satisfy any money
which may be due to the City, recently taking possession of$l million from Jeff
Hambarian.5. The City has hired consultants to review the trash service and recycling operations
in order to prepare a request for competitive bids for trash
services.6. The City has been negotiating with ORRS' attorneys for return of all funds due the
City and to resolve outstanding contract
issues.PAGE
CITY COUNCIL MINUTES August 11, 1998
4. REPORTS FROM MAYOR COONTZ (Continued)
Question:
Answer:
Will the City terminate the contract?
There are two contracts; one for trash pick-up and one for
recycling.1. The only known fraud occurred in the recycling
contract.2. When the alleged fraud was first uncovered, it was decided to await the outcome of
the criminal
investigation.3. The investigation has taken longer than anticipated, so we are reviewing the
contract termination
issues.4. If the City decides to terminate the recycling contract, it needs to ensure that it
has another contractor in place to provide good
service.
Question:
Answer:Why did the City never competitively bid the
contract?1. Most likely because through all the years the rates were among the lowest in the
County,the service was good and Orange Disposal Services was in compliance with its contract to
the best of our
knowledge.2. However, before entering into the Orange recycling contract in 1994, quotes for
recycling services were solicited from other contractors, but they were not competitive with the
ORRS proposal. Outside quotes in 1992-93 were about $40 a ton to process trash through
the recycling center, whereas ORRS proposed a rate of $34 a ton with an expectation that it would
go down.Question: Is the $1 Million in the escrow account sufficient to cover all the City'
s possible ORRS'
fraud losses?Answer: The amount lost is still being investigated by the District Attorney,
however, the City Attorney has asked the District Attorney to let us know if additional funds
are needed.Question: Why is the investigation taking
so long?Answer: The investigators have had to supoena and review hundreds of thousands
of pages of documents from banks and others. Banks have been slow in responding and
non-responsive at times which
extends
the
investigation.Question:Answer:Is the City buying the recycling center
for the Hambarians?1. No. That is not
the contractual agreement.2. The City agreed that ORRS could directly pass through the cost of the
recycling center as part of the contract. All trash recyclers pass on the costs of their recycling
centers to ratepayers.3. In exchange, ORRS agreed that the revenue from the sales of recyclables
would go back
to the City.4. In every year of operation so far, the revenue from the sale of recyclables
has been more than the annual cost to the City for the recycling center. The revenue is credited to
the City to
keep rates
CITY COUNCIL MINUTES August 11, 1998
4. REPORTS FROM MAYOR COONTZ (Continued)
5. At the end of 10 years the loan costs go away, but the City will continue to receive
revenue from the sale of recyclables.
I know that I have not answered all the questions that the public may have, but these are some of
the main areas of interest. This has been a lengthy pursuit by the District Attorney, however, we
have confidence that a thorough investigation is being done.
Carole Walters, (address on file), commented that the City's Police Chief and a Lieutenant were
lost, which will cost the City money. Why didn't Council ask for reports? The City Attorney
explained the City does not receive the audit until after a full year of operations. The
misappropriation was caught during the second audit year of the recycling contract and was
turned over to the Police and the District Attorney's office.
COUNCILMAN ALVAREZ expressed dissatisfaction that some of the information in the report had
never been provided to him. He indicated he was surprised this information was coming out in
this form as opposed to the Council being briefed in Closed Session. It was suggested that the
City Attorney provide Council with copies of the same information so that that Council doesn't
learn the information at different times.
THE CITY ATTORNEY explained that he assisted the Mayor in writing the report. He indicated he
thought the entire Council had been informed about most of the issues. Most of this information
has come from the District Attorney's office, which is the extent that he could vouch for its
credibility."
MAYOR COONTZ responded the questions that were formed were the kind of questions that people
have asked, indicating the City Attorney and Public Works Director checked this information for
accuracy. The questions are general, the answers are simple, and things that should be known.
The report was a simple desire to have questions and answers for the public.
IN RESPONSE TO COUNCILMAN SLATER'S QUESTION relative to the City buying the recycling
center from the Hambarians, the City Attorney clarified the taxpayer's are paying off the loan
with the fee that was added to the bill.
COUNCILMAN ALvAREz asked if the taxpayers have a vested interest in the facility? The City
Attorney responded under the contract, the City has agreed to assess a fee sufficient to payoff
the annual cost of the loan. The City is not directly obligated on the loan. Once the contract is
terminated, that obligation is extinguished. Both ORRS and Sam and Alyce Hambarian have
personally pledged to payoff the loan.
PAGE 12
CITY COUNCIL MINUTES August 11, 1998
5.REPORTS FROM COUNCILMEMBERS Tape No. 2273
5.1 Mayor pro tem Slater - Request Council consider a building moratorium on the south side
of Culver between Shaffer and Cambridge Streets.Mayor
pro tem Slater reported the proposed moratorium is not intended to in any way affect or target
the application that is currently being processed for the Zehner property. The Zehner's have
spent $30,000 in trying to move their application through the process and it has taken an inordinate
amount of staff, Planning Commission, Design Review Board, and Council time. The Council
has expressed a concern for the need to look at this block and consider some changes.The
block was changed to R-2 zoning a number of years ago. He would not want to see another
applicant have to go through the process the Zehner's have had to go through. If it is the intent
of the Council to make no changes on this block, then there is no need to consider the interim
Ordinance. If there are any changes to be made, this would give Council a pause to thoroughly
explore what the changes might be before any more applications are submitted. The interim
Ordinance would be for 45 days and extended if necessary. The interim ordinance should not
affect anyone on the block that wants to submit an application to add on to their house or build a
secondary unit, which was the original intent of rezoning the block to R-
2.Staff is returning to Council at the August 25th meeting with proposals for this block. It
was proposed the moratorium be presented to Council at the September 8th meeting. His fear is if
this is dragged on, and another applicant comes in, there will be the same frustration and time
spent that was spent on the Zehner project. He proposed a motion to include his
suggestions.The Community Development Services Manager clarified that the south side of Culver Street
is unique in Old Towne in terms of the size of the R-2-6 properties. Most
other R-2-6 properties are either developed or 6,000 square foot lots. In this situation, the
lots range from 18,000-20,000 square feet to approximately an acre and the
project size has
greater potential.SPEAKING IN OPPOSITION:Ralph Zehner, 630 E. Culver Avenue, applications
currently going through the process Ken
Brimlow, 652 E. Culver Avenue Mike
Keller, 632 E. Culver Avenue
Carole Walters, (address on file)Carl
Harnack, 546 E. Culver Avenue Eileen
Hertfelder, 720 E. Culver Avenue Linda
Keller, 632 E. Culver Avenue Daniel
Brimlow, 652 E. Culver Avenue
Corrine Schreck, 446 N. James Reasons for Opposition: Compatibility with Old Towne is issue, but
no one knows what Old Towne is; bulk and mass; property was legally rezoned in
1993; a moratorium poses an immediate threat; lack of notification; property rights being taken
away; and this block
should not
CITY COUNCIL MINUTES August 11, 1998
5. REPORTS FROM COUNCILMEMBERS (Continued)
SPEAKING IN FAVOR:
Martha Phelan, 375 S. Pine Street, submitted petition with 233 signatures
Connie Strubel, 390 S. Pine Street
Patty Ricci, 618 E. Culver Avenue
Mattie Link, 801 E. Culver Avenue
Shannon Tucker, 556 E. Culver Avenue, wrote letter dated July 2nd requesting the moratorium
Reasons for support: Neighborhood compatibility; affect of bulk and mass on the neighborhood;
historic architectural context; negative impact with neighbors; type of development.
SPEAKING IN NEUTRAL POSITION:
Barbara DeNiro, (address on file)
Mayor pro tem Slater commented the proposed moratorium was strictly to say if it is the
Council's intent to make some kind of change on this block, a 45 day pause would allow time to
let the process run its course before more applications are presented, and staff having to waste
inordinate amounts of time trying to deal with them. It is not about changing the zoning tonight.
A moratorium would be in place until Council decides what they want for the block. The
moratorium would prevent more apartments from being built in Old Towne. There is a property
for sale on this block which is being promoted as being for units. It would be misleading to
someone interested in purchasing the property if the City Council has another goal in mind. The
moratorium would not prohibit someone from building onto their property currently or adding
another house on to the back of their property.
COUNCIL COMMENTS
Councilman Murphy spoke in opposition to the moratorium. He believes a moratorium would
cause an acceleration of applications from residents on South Culver. Moratoriums are for
current and immediate threat to public health, safety, or welfare. He favors an expeditious
process for a solution without having a moratorium in place.
Councilman Alvarez expressed concern with the notification process. It was suggested that a
1,000 foot radius be notified, rather than the required 300 foot radius. The neighborhood should
have a direct impact on determining what the zoning should be.
Mayor Coontz commented the reason the Council has gotten into this issue is the confusion of
the zoning ordinance in relationship to the Old Towne Design Guidelines. Staff will be
presenting a report to Council at the August 25th meeting. A quicker solution to this problem,
possibly an overlay zone, would be a better effort than going through the moratorium.
Councilman Spurgeon commented he could not support a moratorium at this time.
PAGE 14
CITY COUNCIL MINUTES August 11, 1998
5. REPORTS FROM COUNCILMEMBERS (Continued)
In response to Council, the Community Development Services Manager explained the report that
will be presented to Council at the August 25th meeting will analyze the options heard by Council
at the June meeting, evaluate the alternatives for South Culver, and make recommendations for
Council's consideration.
Mayor pro tem Slater commented a moratorium is an effective tool that cities can use if they feel
a change needs to be made. He indicated he was not on the City Council when they voted to
rezone South Culver, but was merely trying to come up with solutions to try to resolve the issue.
Too much time has already been spent. Mayor pro tern Slater withdrew his request in hopes that
some other solution can be found. It is hoped that another application for apartment buildings on
South Culver doesn't happen before a decision is made.
THE CITY COUNCIL RECESSED AT 6:50 P.M. AND RECONVENED AT 7:02 P. M. COUNCIL
CONCURRED TO COMMENCE WITH PUBLIC COMMENTS AT THE 7:00 P.M. SESSION.
5.2 Councilman Alvarez - Issues relating to trash investigation.Tape 3272 Councilman
Alvarez requested the following comments for the record:1.
Asked for a follow up on the fingerprint investigation handed over to the City Attorney on the final
disposition?The
City Attorney read from a letter he sent to the District Attorney, "As you might recall at a City
Council meeting, both the City Manager and the City Council members offered to make their
finger prints available and requested that I oversee an administrative investigation to see if it
could be determined who leaked the affidavit that was reported in the Times. Initially we only required
Mr. Rudat to provide us prints since we knew Mr. Rudat handled it because that was his copy.
The City's fingerprint expert, Police Officer Trisha Sharkey, compared the prints of Mr.Rudat'
s to those he had previously fumed and photographed. On March 23, 1998, I received a memorandum
from Officer Sharkey stating that the two latent prints he had made, i.e., the ones he
had photographed from the affidavit, both belong to Mr. Rudat. One being Mr. Rudat's left thumb
print and the other his right thumb print. On April 2, 1998, a sealed envelope containing Mr.
Rudat's copy of the affidavit and eight photos of prints from the affidavit were opened.Present
were myself, Officer Sharkey, Captain Robert Gustafson and Interim Police Chief Dean Richards.
Officer Sharkey handled the affidavit with gloves. In reviewing the remaining prints,Officer
Sharkey was of the opinion that there were only a few partials which could possibly be reviewed
and that she believed it would be difficult to determine if they were from a palm or a finger
or some other digit. She was not optimistic that she would be able to determine whether or
not they belong to Mr. Rudat or to someone else. Thus, the conclusion of Officer Sharkey was that
the only legible prints on Mr. Rudat's copy of the affidavit were in fact Mr. Rudat's prints."PAGE
15
CITY COUNCIL MINUTES August 11, 1998
5. REPORTS FROM COUNCILMEMBERS (Continued)
The City Attorney concluded they do not plan on taking the investigation any further. The
document has been sealed and booked into evidence under the original ORRS investigative
number. He communicated to Guy Ormes and copied to Mike Capazzi that if the District
Attorney's Office has any recommendations, requests, or any interest in pursuing the
investigation, that the evidence would be kept preserved. As of yet he has had no contact.
Councilman Alvarez asked the City Attorney to review the procedures of taking custody of a
document of that type.
The City Attorney explained the day the article was printed in the L..A. Times, Mr. Rudat
contacted the Police Department and asked them to come down and retrieve his copy. Mr. Rudat
gave his copy to Lieutenant Tunstall and signed an affidavit saying he had not shown it to
anyone. At that point in time the Police Department was in complete control of the affidavit in
the hands of Lieutenant Tunstall and only Lieutenant Tunstall would be able to testify as to what
his procedures were from that point on. The Police Chief and District Attorney had copies of the
affidavit.
The City Manager indicated the affidavit was sealed by Trish Sharkey, kept in her possession,
and then turned into evidence.
The City Attorney remarked the District Attorney is not undertaking any investigation as to the
leak of the affidavit. The District Attorney's position is that no criminal actions occurred. The
Police Investigators have stated the news article did not hinder the investigation in any way.
Councilman Alvarez asked the City Manager for a report from the City employees who are
overseeing the operation at ORRS, which would include their job duties and observations,
especially since the fire which occurred last week.
The City Manager indicated an update can be provided to Council. Reports are provided to the
Director of Public Works and forwarded on to the City Manager that show the employees are
spot checking particular areas; that the controls are still there. The Police Department notified
the District Attorney's Office regarding the fire and they did send out investigators to follow up
on that issue. The fire was determined accidental.
Councilman Alvarez asked if a similar report, like a management audit, would be produced
indicating what was going on at City Hall, to understand if there were breakdowns in
communication. It would also raise the issue of how the City staff could be dealing with trying
to account for things when the record keeping was so poor.
The City Manager reported the Management Audit underway at this time is a generalized
operational procedural review. This might reveal some more in-depth review that is needed.
The City did not receive all the documentation from the independent auditor that was pertinent
and PAGE
CITY COUNCIL MINUTES August 11, 1998
5. REPORTS FROM COUNCILMEMBERS (Continued)
would help the City to understand there were severe problems. Staff did discover contractual
disputes that needed to be negotiated and worked out.
Councilman Alvarez indicated he is trying to understand how this happened. Concern was
expressed that a long period oftime went by. Why didn't City staff go to the City Manager and
indicate the records are poor? Why didn't what was being received raise red flags?
The City Manager explained that staff had a mindset; there were issues they were trying to
address. No one thought there was any attempt to defraud the City. There were contractual
disputes and delays in getting the City the reports because they had been granted extensions.
ORRS was a start-up company. Orange Disposal had been doing business with the City
for years. ORRS was a new company with a different operation. It was anticipated there would
be some corporate difficulties and perhaps delays. City staff thought they were on top of
those issues. As the Management Audit progresses, areas may be discovered where the level
of information was not received, that may have indicated a particular problem that would
have needed to be addressed
immediately.Councilman Alvarez asked about the City Manager's conflict and how it is to be resolved?
The public needs to be assured that everything Council is doing is unbiased and trying to do what
is best for the
community.The City Manager explained he is waiting impatiently for the District Attorney's final
decision regarding the conflict. In his attempt to manage the issues in a very fair, objective,
and professional manner, he would have no problem if Council desired to have other peer
review.The conflicts occurred during a particular time period. On issues of law, the City's Gift
Ban Ordinance, he took great pains that it was not violated, because he knew about it.. One of
the things he participated in recommending was taking trash to the BKK landfill should come
before Council. That was one of the decisions. In his mind the Council would make that decision,
but he touched it. When the Public Works Director sent papers over to him with
recommendations,he concurred. In the City Attorney's unbiased review of this, he indicated where his wife
had sold Jeff Hambarian's previous residence, she had the listing for two plus years, long before
he was City Manager. It coincidentally sold after he became Interim City Manager. Taking the
post of Interim was truly to be a temporary situation. The issue the District Attorney and FPPC
will decide is whether he violated the FPPC rules on conflict. The District Attorney is examining
it to see if the level ofthe conflicts rise to a civil matter, misdemeanor or some criminal
act.Councilman Alvarez expressed concern that as the City proceeds from this day forward,
that Orange Disposal will look back and say they were warned here and they continued to
allow things to happen. It is a leverage for them that he is concerned
with.PAGE
CITY COUNCIL MINUTES August 11, 1998
5. REPORTS FROM COUNCILMEMBERS (Continued)
The City Attorney commented any legal conflict ended November 1996. The source of income
via his wife was Jeff Hambarian. Jeff Hambarian is no longer with the company so he will not
be impacted in any way by these decisions.
6. REPORTS FROM BOARDS, COMMITTEES, AND COMMISSIONS Tape 4381
6.1 Accept letter of resignation from Dorothy (Jo) Gibson dated July 21, 1998 resigning
from the City Traffic Commission. Instruct the City Clerk to advertise according to
Maddy Act requirements. (OR1800.0.19)
MOTION- Slater
SECOND- Spurgeon
AYES - Murphy, Slater, Mayor Coontz, Spurgeon, Alvarez Moved
to accept Mrs. Gibson's resignation with regrets and instructed the City Clerk to advertise according
to Maddy Act requirements.7.
ADMINISTRATIVE REPORTS Tape 4430 7.
1 Report from the Director of Public Works regarding the evaluation of privatizing City
street sweeping operations - Bid No. 978-46, City Project No. SS-Ol. (S4000.S.3.1.3)
The Director of Public Works reported studies completed on this subject concluded in-
house costs were
cheaper.Barbara DeNiro, (address on file), asked under what heading is street sweeping listed on
the City's utility bill? The Director of Public Works explained once the revised Utility
Billing System is on- line the charge would be clearly
identified.MOTION - Slater
SECOND - Murphy AYES -
Murphy, Slater, Mayor Coontz, Spurgeon, Alvarez Moved to
rejected all bids and retain in-house street sweeping services at the current service level;
and appropriated $520,000 from Unappropriated Vehicle Replacement Fund 720 to Fund 720-
5023-472102 to acquire and replace 4 broom sweeper
units.7.2 Report from the Director of Public Works regarding the selection
of traffic/transportation consultant to assist the City in review and evaluation of the
Urban Rail Project documents. (T2200.1.
4)Barbara DeNiro, (address on file), asked what the placement was proposed for the
urban-rail project area previously discussed
in Orange.
CITY COUNCIL MINUTES August 11, 1998
7. ADMINISTRATIVE REPORTS (Continued)
The City Manager indicated no determination has been made on a permanent route. This subject
is the beginning of this study. The alternative routes discussed previously were Main, Culver,
LaVeta over the freeways to Chapman and City Dr. looping back to the Stadium, the Pond and
heading to Fullerton.
MOTION - Murphy SECOND -
Mayor Coontz AYES - Murphy,
Slater, Mayor Coontz, Spurgeon, Alvarez Moved to select
Meyer, Mohaddes Associates, Inc. (MMA) as traffic/transportation consultant;authorize an initial
budget of $60,000 for services provided by MMA; and authorize the City Manager to increase
the $60,000 contract amount up to the $100,000 limit approved by OCTA for additional scope
of work.8.REPORTS FROM
CITY MANAGER Tape 3103 8.1 Report
on proposed City Telecommunications Policy. (F1100.0)Mayor Coontz gave
the following comments regarding telecommunications:1) Minimize the
disruption.2) Be sure
of the quality of construction and reconstruction - having inspectors review the job throughout construction so there
is not a patchwork quilt effect in the street when the job is completed.3) Quality ofrepair
work
should meet the City standards.4) Have signage so
people will know it is not the City continually digging up the streets and to let people know what
is happening.RESOLUTION NO. 8993 A
Resolution of the
City Council of the City of Orange adopting a City Telecommunications Policy.MOTION - Murphy SECOND -
Mayor
Coontz AYES - Murphy,
Slater, Mayor Coontz, Spurgeon,
Alvarez Moved that Resolution No. 8993 as introduced,
be adopted and same was passed and adopted by the preceding vote, and directed staff to
prepare a Telecommunications ordinance for future adoption incorporating the comments by Mayor Coontz.
PAGE 19
CITY COUNCIL MINUTES August 11, 1998
8. REPORTS FROM CITY MANAGER (Continued)
8.2 Report on assessment of Solid Waste Services - report by Hilton, Farnkopf and Hobson,
LLC. (AGR-0119.F.15.PH)
The Director of Public Works reported the operational procedures were reasonable; costs for
service were reasonable; record keeping procedures were not adequate; maintenance and safety
procedures were adequate but written records need to be improved and method for determining
trash rates is valid. The MRF is functioning at a reasonable level based on its size and type of
equipment; actual costs submitted by ORRS for building the MRF exceeded SCS engineer's
estimate by up to $1 million. MRF equipment costs are reasonable; new programs are needed to
meet AB939 diversion requirements of 50% by the year 2000.
Following analysis of the recommendations of the Hilton Farnkopf & Hobson report, staff has
developed the following action plan for implementation: 1) develop rules for major operations
i.e. purchasing, maintenance, etc.); 2) document procedures for billing and receiving revenue
from customers; 3) improve internal controls by better separation of job duties between
employees; and 4) provide written information to trash truck drivers regarding commercial
routes.
Cost of Service provided by ODS: 1) exclude officers salary and benefits from supervisor
payroll; 2) review rent paid to Hambarian Properties; 3) restructure officers salary and benefits;
4) delete business promotions/donations from rates; 5) restrict advertising expense in rates; and
6) revise commercial trash pick-up
rates.Record Keeping at ODS/ORRS: 1) use numbered tickets for tracking trash bin pick-
ups; 2)further improve ORRS process for issuing cash receipts for recyclables brought to the
MRF; 3)develop complaint tracking system; 4) monitor maintenance costs by vehicle; and
5) start process for reporting tonnage of trash received each month and comparing it against
tonnage sent
to landfills.Maintenance/Safety Procedures - Keep a record of driver safety
meetings.Rate Setting Method: 1) require financial audits for ODS/ORRS with "unqualified"
audit opinion (no exceptions noted by auditor); 2) establish rates which are lower for customers
who recycle; 3) establish a system for promoting efficient method of commercial collection; and
4)develop trash bin rates which are based on actual
costs.New Programs Recommended: 1) automate curbside recycling; 2) initiate
multi-family recycling for apartments and condo complexes; 3) expand the collection of
commercial loads where dry recyclable material is separated from wet materials; 5) start a residential
green waste program with separate trash bins for green waste; and 6) initiate a program for
collecting and recycling construction and
demolition waste.Staff has proposed to meet with ODS/ORRS to implement City Action Plan
and request ODS/ORRS to comply with recommendations. City staff to conduct a rate analysis and
return to
CITY COUNCIL MINUTES August 11, 1998
8. REPORTS FROM CITY MANAGER (Continued)
Council with recommended rate adjustments. City staff to initiate Request for Proposal to go out
to bid for solid waste services.
COUNCIL DISCUSSION:
Councilman Alvarez asked if the record keeping was not done properly as outlined in the report;
how was the Public Works staff dealing with it? The Public Works Director indicated
historically the outside auditor's work had always been relied upon. The auditor annually filed
financial statements and a rate analysis for both companies which were reviewed by City staff.
Councilman Alvarez asked if evergreen clauses in contracts with waste hauling companies are
still included? The Public Works Director commented evergreen clauses are universal and are
included in waste contracts.
Mayor Coontz asked about the different types of contracts and how much they cost?
Laith B. Ezzet, Vice President, Hilton Farnkopf & Hobson, after surveying all cities in Los
Angeles and Orange County, found evergreen clauses are much more popular in Orange County.
Between 50-60% of the cities in Orange County have the evergreen
clause.In terms of the rate adjustment process, the City has the MRF and it is more difficult to use
an index from a material recovery facility because the cost can fluctuate with the recycling
markets.It is easier to use the index with a collection contract. Options will be discussed
when competitive proposals are ready to go
out.The following people
spoke:Barbara DeNiro, (address on file), asked if there was a proposed rate hike in the report; what
is the difference between sanitation services and trash collection on the utility bill; and
other
concerns.Mayor Coontz asked Ms. DeNiro to submit her questions and concerns to the City Manager for
a
response.Harry Astor, Counsel for ODS and ORRS, commented the final report was received by his
office yesterday afternoon. Mr. Astor requested a continuance giving them time for a complete
review.Concern was expressed that after a cursory review and reference to the million dollar
allegation,Mr. Astor believed the report is incomplete and there is a discrepancy of $700,000 in
connection with equipment
expenses.The City Manager remarked the one million dollar distinction is an area of forensic
accounting which the City is already paying someone to do in the District Attorney's Office and they will
do a thorough examination over the next few
weeks.PAGE
CITY COUNCIL MINUTES August 11, 1998
8. REPORTS FROM CITY MANAGER (Continued)
The City Attorney reported the draft report and final report were the same. Information was
faxed to Mr. Astor and there was an opportunity to review it.
Carole Walters, (address on file), complained about the recycling bin service fees; and asked if
there will be another hearing on this issue.
The City Manager commented there are no fees proposed at this meeting. Staff is reviewing a
rate review and all components of the Sanitation Fund. It is estimated the report will be to
Council the first meeting in September.
Councilman Alvarez asked where did the problems lie, specifically; record keeping?
Mr. Ezzet commented as a small family run company with informal procedures and if there is no
written documentation, it is difficult to have an audit completed. The lack of written procedures
can cause problems.
MOTION - Spurgeon SECOND -
Alvarez AYES - Murphy,
Slater, Mayor Coontz, Spurgeon, Alvarez Moved to receive
and file the final report on Assessment of Solid Waste Services; directed staff to implement the
recommendations of the report as appropriate in accordance with the Action Plan for recommendations;
directed staff to present a Rate Adjustment Proposal as soon as possible; and directed
staff to initiate action to develop a Request For Proposal for Solid Waste Services.9.LEGAL
AFFAIRS
Tape 5013 9.1 ORDINANCE
NO. 11-98 An Ordinance
of the City Council of the City of Orange amending the Orange Municipal Code by revising
Chapter 5.63 concerning Plaza banners. (A2500.0)MOTION - Spurgeon
SECOND - Slater AYES -
Murphy, Slater, Mayor
Coontz, Spurgeon, Alvarez Moved that Ordinance No. 11-
98 be read by title only and same was passed and adopted by the preceding vote.9.2
ORDINANCE NO.
12-98 An Ordinance of
the City Council of the City of Orange amending Title 17 of the Orange Municipal Code relating
to Site Plan Review Procedures. (A2500.0)PAGE 22
CITY COUNCIL MINUTES August 11, 1998
9. LEGAL AFFAIRS (Continued)
MOTION - Mayor Coontz SECOND -
Slater AYES - Murphy,
Slater, Mayor Coontz, Spurgeon, Alvarez Moved that Ordinance
No. 12-98 be read by title only and same was set for second reading by the preceding
vote.9.3
ORDINANCE NO. 13-98 An
Ordinance of the City Council of the City of Orange amending Title 17 of the Orange Municipal
relating to Fencing, Roof Mounted Equipment, Paving of Front Yard Areas In Residential
District, Rock Crushing Equipment and Accessory Structures. (A2500.0)MOTION -
Slater SECOND - Murphy
AYES - Murphy, Slater,
Mayor Coontz, Spurgeon, Alvarez Moved that Ordinance No.
13-98 be read by title only and same was set for second reading by the preceding vote.
10. RECESS TO
THE MEETING OF THE ORANGE REDEVELOPMENT AGENCY 11. RECESS TO
CLOSED SESSION The City Council
recessed at 10:30 p.m. to a Closed Session for the following purposes:NOTE: The City
Council added the following urgent item to Closed Session: The City Attorney explained the reason
it was not on the Agenda is that the terms of the settlement were hammered out after the
posting of the Agenda.MOTION - Murphy SECOND -
Mayor Coontz AYES -
Murphy, Slater, Mayor Coontz,
Spurgeon, Alvarez Moved to add a case under
potential litigation.a. Conference with real property negotiator
regarding the sale of real property pursuant to Government Code Section 54956.8: Property:
comer of La Veta Avenue and Orange Street 492 S. Orange Street, Orange, California);
Negotiating Parties: City of Orange.PAGE 23
CITY COUNCIL MINUTES August 11, 1998
11. RECESS TO CLOSED SESSION (Continued)
b. Conference with Legal Counsel pursuant to Government Code Section 54956.9 - existing litigation.
Old Towne Preservation Association v. City of Orange, et aI., Orange County Superior
Court Case No. 79 64 35. City of Orange vs. KPMG Peat Marwick, Orange County Superior
Court Case No. 772237.c.
Conference with Legal Counsel - anticipated litigation. Significant exposure to litigation pursuant to
Government Code Section 54956.9(b) (twopotential cases). Contract with ORRS d. Conference
with Labor Negotiator pursuant to Government Code Section 54957.6: City Negotiator: Personnel
Director Steven Pham; Employee Organization: Police Association e. To
consider and take possible action upon such other matters as are orally announced by the City Attorney,
City Manager, or City Council prior to such recess unless the motion to recess indicates any
of the matters will not be considered in Closed Session.7:00
P.M. SESSION 12.PUBLIC
COMMENTS Tape 4830 Barbara DeNiro, (
address on file), expressed concern that the area west of the 55 Freeway not become a
concrete jungle with no added open space and that high density housing not continue in the area.
Schools and neighborhoods suffer as a result of these actions in the past, and requested a map
of the location of high-density apartment complexes and housing in the area; and commented
on OTPA having exclusive control of Old Towne. The City Manager indicated he would
have the Community Development and Economic Development Department's provide Ms.
DeNiro with the information requested.Carole
Walters, (address on file), commented on the Mills Act Program, the Historic Register,and
concerns with Old Towne. She announced OUSD will be meeting on August 12th at 5 p.m.to
discuss the Mills Act Program.13.
PUBLIC HEARINGS Tape 4830 13.
1 GENERAL PLAN AMENDMENT 1-98 (Circulation Element); CONDITIONAL
USE PERMIT 2199-98, VARIANCE 2040-98,
MITIGATED NEGATIVE DECLARATION 1542-98, CIRCUITCITY
STORES, INC.!CARMAX:Time set for a public hearing on petition by CircuitCity Stores, Inc.lCarmax
to consider General Plan Amendment 1-98 a request to eliminate a planned
primary arterial highway segment Walnut Avenue), from the Circulation Element and Master Plan
of Streets and Highways;Conditional Use Permit 2199-98 to develop an automotive sales
facility (including a 73,350 square foot showroom, sales and service building, car
wash building, outdoor storage areas,customer and employee parking in an industrial zone); and Variance
2040-98 to allow a free standing sign with a display area of approximately 260 square feet and
a height
CITY COUNCIL MINUTES August 11, 1998
13. PUBLIC HEARINGS (Continued)
grade. The site is located at 291 N. St. College Blvd. (Orange Drive-In site) adjacent
to Interstate 5. (C2300.E
GPA-1-98)NOTE: Councilman Murphy abstained from voting on the item due to potential
conflict on the basis of employment and left
the Council dais.The Planning Manager reported the project consists of an approximately 73,000
square foot sales and service facility which includes service bays for 59 vehicles, a separate car
wash facility, two auto staging areas, a sales lot with 861 parking spaces for cars that would be sold,
and a large customer/employee parking area. The site is approximately 19 acres in size. Twelve
acres are in the City of Orange; seven acres are in the City of Anaheim. Staff from
both cities have coordinated review of the development plan and the environmental document.
The project is scheduled to go before the Anaheim City
Council next week.The request is for a 48 foot freestanding sign with a display area of 260
square feet, which exceeds the City's maximum freestanding sign height limit of 15 feet and display
area of 160 square feet. With the exception of the sign variance, the project meets
all City development standards. The Planning Commission approved the project at their June 15th
meeting subject to 47 conditions of approval. (NewlModified conditions proposed since the
June 15th Planning Commission Meeting are on file in the City
Clerk's office.)IN RESPONSE TO COUNCIL'S QUESTIONS, the Planning Manager explained this
project would not qualify for the new signage that was approved for the Mills Project, which
is restricted to properties 25 acres or greater. The City has control over the signage for the
property. There is currently no special signage applicable
to freeway frontage.MAYOR COONTZ OPENED
THE PUBLIC HEARING.Rick Manners, representing Circuit City/CarMax, 680 S. Lemon Avenue,
Walnut, explained that CarMax sells primarily used cars. There is a provision for an expansion area
which would allow for a new car showroom for Chrysler. The used cars are primarily 5 years old or
less; 75,000 miles or less. No balloons, banners, or gorillas would be used, and there would be
a no haggle,fixed pricing system. Parts and warranty service that is needed to service the
cars is outsourced to local dealerships. CarMax has been up and operational for five years. The
site would generate approximately $1 million per year in tax revenue
to the City.
SPEAKING IN OPPOSITION:Cindy Pelton, 300 N. Rampart, #128 (resident of
mobile home park)Bill Selman, President of Selman Chevrolet, 83 Emerald
Bay, Laguna Beach Dave Wilson, Toyota of Orange,
1400 N. Tustin Jerry Britain, Nissan of Orange,
1140 W.
CITY COUNCIL MINUTES August 11, 1998
13. PUBLIC HEARINGS (Continued)
Barry Ross, 1750 E. 4th Street, Suite 500, Santa Ana, attorney representing Selman Chevrolet,
Toyota of Orange, Villa Ford, Nissan of Orange, and Ford of Orange. Mr. Ross handed Council
a statement dated August 11, 1998 requesting it be made part of the record. (Statement on file in
the City Clerk's office.)
Brian Butler, President of Villa Ford, 2550 N. Tustin Avenue, (letter read into the record by the
City Clerk)
CONCERNS EXPRESSED WERE: Late notification of the meeting; noise; traffic; congestion; lights;
land use; sign variance; impact on other car dealerships.
SPEAKING IN NEUTRAL POSITION:
Barbara DeNiro, (address on file), expressed concerns with signage, attractiveness of the project,
affect on long-time dealers, parking, traffic, and the tax base. Where is the closest
established CarMax? Will Orange end up with taxes mostly from used car sales? Which part of the
facility will be in
Orange?Carole Walters, (address on file), expressed concern with the notification of the residents in
the mobile home
park.The Planning Manager explained a mailing was done to property owners within 300 feet of
the site and the site was posted as well in conformance with State law. This includes the owner
of the mobile home park. He referred to a map depicting which areas of the dealership would be
in the City of Orange and those which would be in the City of
Anaheim.
REBUTTAL:Rick Manners responded a condition requires there be no movement of the cars in the
staging area located close to the easterly boundary in the evening hours. The service portion of
the building is totally enclosed. The two roll-up doors on the east end are
automatically sensored and are closed 90% of the time. The noise would be contained inside the building. There
will be no loud speakers on the site. Perimeter lighting fixtures adjacent to a residential-type
use will be shielded so that the glare is contained. CarMax would be installing a new 16 inch
water line at their cost. The closest established CarMax is located in Texas. This would be
the
first California store.Ben Cummings, Vice President of Real Estate for Circuit City/
CarMax, Richmond, VA,commented that CarMax will be a good neighbor and spoke regarding
other proposed CarMax sites in California. There are currently two Chrysler dealerships in Atlanta, GA.
They are in negotiations for other dealerships in California, Texas, and in Washington D.
C. Their intention is to have 80-90 CarMax used car facilities and approximately 25 new
car franchises
within the
CITY COUNCIL MINUTES August 11, 1998
13. PUBLIC HEARINGS (Continued)
Mayor Coontz asked if CarMax moving into the City of Orange is dependent upon approval of
Economic Development assistance? Mr. Cummings responded they would certainly prefer to
have some assistance in the form of a sales tax rebate. No approval is being tied to economic
assistance.
In response to Mayor pro tern Slater, the Planning Manager indicated the Planning Commission
made no changes to the applicant's original sign request. Multiple signs are allowed on the
frontage because it exceeds 400 feet. Currently there is one monument sign located near the
entrance to the project on State College that is within the 15 foot height and 160 square feet of
area as required by the Code. They are also allowed a second sign. The applicant requested the
second sign because they felt they needed the visibility to successfully market their property.
COUNCIL COMMENTS:
At the request of Mayor pro tern Slater, the Director of Economic Development reported when
CarMax approached the City about the site approximately one year ago, GRC and Associates
performed an economic analysis on the land with a high-rise office building, a retail center, and
a high-quality hotel. An analysis was done also on the CarMax use. The CarMax use
would bring more revenue to the City than any other use they could come up with that would
be appropriate for the site. A high-rise building was at one time approved for the site but it did not
prove to
be economically feasible.Mayor pro tern Slater commented the market has determined at the present time this
is the best use for the land. He noted he does not favor high signage, but given the
circumstance that the freeway will be 28 feet above ground level, it would an extreme hardship and
impractical that the applicant be restricted to a 15 foot sign. The goal is to attract people to the site.
He feels the mobile home residents will be protected and a high-rise or hotel would be
a much worse impact than CarMax. This project would also generate the most sales tax
revenue for the City.Councilman Spurgeon spoke in opposition to the project, indicating there are
no hard figures on how much sales tax revenue would be generated. This "platinum triangle" area
needs to be a shared vision between the City of Orange and the City of Anaheim with the
highest and best use.Councilman Alvarez spoke in opposition, expressing concern with the vision and
use of the site,and the car dealerships already in
the City of Orange.Mayor Coontz expressed concern with the rapid growth of CarMax
and the proposed signage.The future for the area is greater than that of auto use. She indicated
she originally proposed the program that was started years ago that would work with
the City
CITY COUNCIL MINUTES August 11, 1998
13. PUBLIC HEARINGS (Continued)
MOTION - Mayor Coontz SECOND -
Alvarez AYES - Mayor
Coontz, Spurgeon, Alvarez NOES - Slater ABSENT -
Murphy Moved to
deny Mitigated Negative
Declaration 1542-98 as not being an adequate and complete assessment of environmental consequences
related to the project.MOTION - Mayor Coontz SECOND -
Alvarez AYES - Mayor Coontz,
Spurgeon, Alvarez NOES -
Slater ABSENT - Murphy Moved to deny
General Plan Amendment
1-98 (CE)
to the Circulation Element and Master Plan of Streets and Highways as the General Plan
Amendment is not in the public interest.MOTION - Mayor Coontz SECOND - Alvarez AYES - Mayor Coontz,
Spurgeon, Alvarez NOES - Slater
ABSENT - Murphy Moved
to deny Conditional Use Permit 2199-
98.Mayor Coontz
commented: "That also
is a deviation from what I think
is our understanding of office uses and other uses in that project area. The elimination of
the roadway would prevent us from future development in the area by reducing traffic capacity." Also mentioned
was the lack of compatibility with the adjacent mobile home park; the problem with the
automotive repair bay storage areas, etc. being so close to the mobile home park; and
other areas for the potential build-out of the whole triangle area on both sides of the freeway.
MOTION - Mayor Coontz SECOND - Alvarez AYES - Mayor Coontz, Spurgeon, Alvarez NOES - Slater
ABSENT - Murphy Moved to
deny Variance No.
2040-98.PAGE 28
CITY COUNCIL MINUTES August 11, 1998
13. PUBLIC HEARINGS (Continued)
Mayor Coontz stated the denial is for the following reasons: "There are other properties in the
immediate area with identical zoning which are equally impacted by the 5 Freeway. We don't
know just exactly what is going to happen to those properties in the future when the 5 Freeway is
developed. I object to the large sign. I think it starts a precedent that we may not want to follow
in the future. Mayor Coontz further stated: "The sign code already provides for additional and
taller signs for larger parcels, and the parcel enjoys broad visibility from State College Boulevard
and/or the 5 Freeway. An increase in height or display area would amount to a special privilege
inconsistent with other limitations upon property in the same zoning vicinity."
MOTION - Mayor Coontz SECOND -
Slater AYES - Slater,
Mayor Coontz, Spurgeon, Alvarez ABSENT - Murphy Moved
to concentrate on
what the future vision for the area should be given the high volume of traffic, the new development
that is taking place, and the fact that other entities are progressing and proceeding maybe a
little faster than the City of Orange is on the question of vision.MAYOR PRO TEM SLATER -
MINUTE ORDER: "I think that the City Council taking a look at this area in terms of what
we want it to be zoned and the direction we want it to take is great. I would hope that that would move
ahead very quickly too. I definitely think that this property has greater potential that just being
zoned industrial. However, I also feel that when a City Council steps out and tries to
decide which uses should go where and which businesses should go where,that it impinges on the
free market system and it send a message that we are not pro-business,which is a problem
that some of our adjacent cities have."THE CITY COUNCIL RECESSED
AT 8:27 P.M. AND RECONVENED AT 8:35 P.M. TO ITEM No. 8.2 ON THE AGENDA.14.
PLANNING AND ENVIRONMENT -
None 15. ADJOURNMENT The City Council
adjourned at
11 :50 p.m.1A#~AAJ~~CASSANDRA 1. HCART,
CMC CITYCLERKPAGE29