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HomeMy WebLinkAbout4_16_2002 - Council Minutes - Adjourned Regular MeetingAPPROVED BY THE CITY COUNCIL ON MAY 14, 2002 CITY COUNCIL MINUTES ORANGE, CALIFORNIA OF AN ADJOURNED REGULAR MEETING APRIL 16,2002 The City Council of the City of Orange, California, convened on April 16,2002 at 5:00 p.m. in an Adjourned Regular Meeting in the Weimer Room, 300 E. Chapman Avenue, Orange,California. 5:00 P.M. BUDGET STUDY SESSION 1. OPENING 1.2 PLEDGE OF ALLEGIANCE TO THE FLAG Led by Mayor Murphy 1.3 ROLL CALL PRESENT - Slater, Mayor Murphy, Coontz, Cavecche ABSENT - Alvarez (arrived at 5:06 p.m.)1.4 PRESENTATIONSI ANNOUNCEMENTSI INTRODUCTIONS The Assistant City Manager reported the City Manager would not be present due to a personal emergency. 2. PUBLIC COMMENTS At this time, members of the public may address the Council on any off-agenda items within the subject matter jurisdiction of the Council, provided that NO action may be taken on off-agenda items unless authorized by law. Comments are limited to three minutes per person. Tom Anderson, Orange resident, spoke in favor of residents in the Pheasant Run Tract needing a sound wall now due to the noise on Chapman Avenue. Mr. Anderson said this needs to be placed on the agenda now. The Assistant City Manager reported the Public Works Department is looking at modifications in their budget work plan to amend the Traffic Safety Improvement Program to allow money to go into that fund as well as embarking on a sound study of that area. The Public Works Director indicated they are drafting a request for a proposal which is a four week process and it would take another two months to complete the study. At that point they can identify the noise impacted areas and scope the project with the appropriate mitigation measures and related items. Public Works will be revising the overall Transportation System Improvement Program specifically in this case to add sound walls as a measure that can be funded out of that fee program. Now, there is no funding source for sound walls unless it is part of a street widening proj ect where noise mitigation is necessary based upon the environmental impact report. The area for the sound study is from Cannon Street to Newport Boulevard. PAGE 1 r.------~~-~-------..------_"...___ CITY COUNCIL MINUTES APRIL 16,2002 3. CONSENT CALENDAR All items on the Consent Calendar are considered routine and are enacted by one motion approving the recommended action listed on the Agenda. Any member of the City Council, staff or the public may request an item be removed from the Consent Calendar for discussion or separate action. Unless otherwise specified in the request to remove an item from the Consent Calendar, all items removed shall be considered immediately following action on the remaining items on the Consent Calendar. 3.1 Declaration of City Clerk, Cassandra J. Cathcart, declaring posting of City Council agenda of an adjourned regular meeting of April 16, 2002 at Orange Civic Center, Main Library at 101 N. Center Street, 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 adjourned regular meeting.ACTION: Accepted Declaration of Agenda Posting and authorized its retention as a public record in the Office of the City Clerk.MOTION - Slater SECOND - Cavecche AYES - Slater, Alvarez, Mayor Murphy, Coontz, Cavecche Item 3. 1 was approved as recommended.4. REPORTS FROM MAYOR MURPHY - None 5. REPORTS FROM COUNCILMEMBERS - None 6. REPORTS FROM BOARDS, COMMITTEES, AND COMMISSIONS - None 7. ADMINISTRATIVE REPORTS - None 8. REPORTS FROM CITY MANAGER 8. 1 Report on the proposed Fiscal Year 2002/2003 Budget including a summary of projected revenues and recommended expenditures.The Assistant City Manager reported this is a difficult year from an economic standpoint when we consider the recession and the national tragedy of September II th and the combined economic impact of these events. The cumulative effects were discussed in the City Manager's narrative regarding the slowing economy coupled with the impact of the September 11th tragedy.There is no doubt it added to an already deteriorating economic outlook for the Nation, State and the City of Orange. Sales tax, transient occupancy tax, investment income and revenues from PAGE 2 T CITY COUNCIL MINUTES APRIL 16, 2002 8. REPORTS FROM CITY MANAGER (Continued) licenses and permits are all down. The significant unknown on the horizon is what will occur with the Vehicle License Fee backfill. As of now, the Governor has assured cities that he will not balance the budget on the backs of the cities and will not take the VLF offset. It was heard that the VLF at the State legislative level is still on the table and the uncertainty will persist until the State's budget is passed sometime near the end ofthe year. On the expenditure side, it should be noted the fiscal conservatism of the Council has allowed the City to weather economic downturns while still providing quality public service to the residents and businesses of the City. The expenditure increases for the coming year are flat and the growth of City employees has been limited to essential positions only. To finish the current fiscal year in a strong position, and to balance the coming year's budget, the Department Heads have responded with a "we can do attitude" which makes them such a strong team. They have been asked to secure a cumulative total savings of $2,000,000 in the current budget and showing their budgets for the remainder of the fiscal year as administrative savings. Also for the coming fiscal year, their budgets have been adjusted with program budget savings totaling $1. 9 million. Proposed Budget The Assistant City Manager reported the budget is balanced totaling $63.8 million. Regarding the Redevelopment Agency's Pass Through which due to a recent court case appealed to the State Supreme Court, the City will lose approximately $500,000 in redevelopment funds annually going forward. Additional information will be provided to Council. The Assistant City Manager reviewed the balancing strategies of one time savings. Regarding Library Services the City Manager is recommending the Library Services be established as a separate department in the coming fiscal year. Nora Jacob will be upgraded to Department Head as City Librarian including a Secretarial position. It is requested there be 120 days for a smooth transition in the break away of Library Services from Community Services. Annexation of County Islands - community meetings will begin May I st and it is anticipated the annexations will be complete by the end of this year.General Plan Update - It is proposed to add an additional $200,000 this year and next year to the General Plan fund to begin the update.General Fund Reserve - The unreserved fund balance is $3.9 million. The City Manager has asked Council to maintain a $3 million reserve over and above the reserve contingencies to allow for any number of issues that might come up.The Finance Director reviewed the General Fund Revenues, Sales and Property Tax History,Budget Policies and Transfers, General Fund Balances, and Expenditures by department and category. The Assistant City Manager reviewed the recommended staffing changes, and history of full-time employees PAGE 3 CITY COUNCIL MINUTES APRIL 16,2002 8. REPORTS FROM CITY MANAGER (Continued) The Assistant City Manager announced a Study Session with the Parks, Planning and Development Commission will be scheduled sometime in May, 2002. Council Comments Councilmember Coontz commented the budget gets better every year. Regarding the Redevelopment Agency pass through amount of $500,000 which goes to the school district, this has been going on for many years and the City has not received any type of audit or how the expenditures were made. It is supposed to be made for facilities. There have been complaints for a long time on the condition of OUSD's buildings and the need for more facilities. There needs to be an audit of that particular fund that goes to the school district. The Assistant City Manager indicated the City's internal auditor can perform the audit and report back to Council. Councilmember Coontz remarked the budgetary transfers on Page 3 are not as clear as it could be. As to reserve contingencies, the 25% emergencies for the COP debt services which are the payments for the Police Building and the carryover needs to be explained more clearly. The charts need to also show the year. Other items like HQHV AC - not everyone will know what this means. There should be an example of the transfers of money that the City Manager oversees. Councilmember Slater asked the Finance Director what the projected unreserved fund balance was for last year? The Finance Director said $6 or $7 million. Councilmember Slater appreciated the staff report from the Community Development Department regarding code enforcement and in light of the budget situation, appreciated adding the one code enforcement clerk which is a step in the right direction. Regarding the other items, possibly they could be agendized in the future to address other policy issues but not necessarily any more staffing positions this year.Mayor pro tern Alvarez asked to explore the revenue use of money and property asking if the money being placed in the City's portfolio was restricted funds. The Finance Director reported a capital project is not started unless there is money in the bank ready to go for that project. There have been a number of capital projects that the City has budgeted for but have not been initiated which is why the portfolio has risen. The composition of the $135 million comes from a variety of specialized funds that cannot be used for general City operations and the majority are restricted funds.Mayor pro tern Alvarez asked if they could create a pie chart or schedule the Council could see as to what makes up that investment, where it is coming from and what it is being allocated for?The Finance Director indicated they would produce that.Mayor pro tern Alvarez asked the Finance Director if there was a way to increase the investment portfolio. The Finance Director commented not without adding additional risk. Mayor pro tern Alvarez asked if there was a certain level of money the City needed to maintain as money is going out to take care of capital projects. The Finance Director indicated they analyze every fund and based on the available resources the budget is planned accordingly. It also depends on the total budget of all funds and all projects; it would be well over $100 million.PAGE 4 CITY COUNCIL MINUTES APRIL 16, 2002 8. REPORTS FROM CITY MANAGER (Continued) Mayor pro tern Alvarez asked for an explanation ofthe Program Budget Savings Plan and how it is applied to the Budget. The Assistant City Manager noted they looked for a target of $2 million this year for the Program Budget Savings Plan. Over the past several years there has been savings and returns in the budget. He explained that the Finance Department produced a General FundlUnexpendedlUnencumbered balance sheet by Department for a period of 5 yearsandhowtheyarrivedatthesavingsfromeachdepartmenttoachievethe $1.9 million. The savings have been based on salary savings and over the years with stafftumovers. This year the City is beginning the Fiscal Year fully staffed in Police and Fire. This does put pressure on departments who might not achieve the salary savings targeted in the $1.9 million which refers back to the $3.9 million in General Fund Reserves. Mayor pro tern Alvarez commented this waythedepartments' expenditures are monitored. Mayor pro tern Alvarez asked about the annexation of County islands costs and possibly revenues associated with it. The Assistant City Manager reported there will be revenues, the projected annual property tax increase total is approximately $92,000. Also, there will be some per capita income based on the 600 new residents. The revenues will not begin until 2003/04. The City negotiated a $2 million transition of funds with the County to help begin necessaryimprovements. Mayor pro tern Alvarez further asked about other reserve accounts. The Finance Director reported there is a total of 75 funds. There are internal service funds; vehicle replacement, liability, workers comp; every fund has a whole set of books. Mayor pro tern Alvarez commented when he talked to some of the Parks Commissioners theydiscussedCommunityServicesbuildingareservetodogeneralmaintenanceoftheparks, like a maintenance fund. The Finance Director commented anything related to park maintenance now is in the General Fund. Mayor pro tern Alvarez asked about the proposal giving the City Manager authority to transfer appropriated funds in non-departmental accounts - how does that dovetail into the one that exists now whereby the City Manager has authority for $30,000 approval. The City Attorney commented they are two completely unrelated items. The limits would be within the adoptedbudget. The Finance Director noted they were not increasing the appropriation or expenditures; rather moving the appropriation from non-departmental to the correct department. At this time,the requirement is for any money to be moved between departments or between Capital Improvement Programs it takes Council approval. Councilmember Coontz indicated Council would be interested in the information and noted a status report was needed whendepartmentfundsaredeployed. The Assistant City Manager indicated it could be included in the quarterly update or could go in the weekly report. There is not a huge pressing need, rather it is a process and the City Manager has taken process issues into his area of responsibility keepingpolicyissueswithCouncil. If Council does not concur that it is a routine process, staff can continue to bring non-departmental transfers to Council for approval.Mayor Murphy asked what is the percentage of funds set-aside are non-departmental? The Finance Director remarked the percentage of funds subject to transfer is approximately $ CITY COUNCIL MINUTES APRIL 16, 2002 8. REPORTS FROM CITY MANAGER (Continued) Mayor pro tern Alvarez asked for a policy or direction because Council puts a priority on the 30,000 that can be done and if we are moving this way there should be a policy to dictate how its done and monitored. Mayor pro tern Alvarez affirmed that the information could be transmitted in the weekly or quarterly report to Council. The Assistant City Manager noted they will include a policy for non-departmental transfers in the adoption ofthe final budget.Mayor pro tern Alvarez commented the Street Fair was a huge expenditure for the City. Mayor Murphy indicated there is a lot of volunteer time by city employees but work deployed by the Police and Fire Department is paid back by the Street Fair Committee. Mayor pro tern Alvarez commented we have these items that come up like the slippage at Nohl Canyon and had to use emergency funds so what are some of the things that should fall into this category. The Assistant City Manager will define it and return to Council.Councilmember Cavecche commented she did not believe Council should include the budgetary transfer in the budget. As she reviews the budget and knows what the departments are spending,if there is a non-departmental transfer she would like to know and have Council approval over that.Councilmember Cavecche commented she is thrilled to see Library Services go back on their own and thanked the City Manager's Office for making that happen.Councilmember Cavecche remarked as the City gets into this budget it is important to recognize the possible downturn at the State level and the need to come up with a way to publicize what may be happening to the budget. The State Officials and Governor will be doing a lot of planning as they go through to November. If the City takes a VLF hit of almost $5 million this City will have a lot of problems. It is important whether it is through the newspapers or a letter from the City Manager in the Fall Progress that the City become very vocal on what might be happening at the State level and the affect on the City. The City of San Clemente is sending letters to its residents giving them copies of form letters to send to their State Officials. Orange needs to get proactive letting people know what might be happening. In today's newspaper, the Governor was looking at cutting back on Prop 98 money and this could cause an uproar in the community about saving the schools. Councilmember Cavecche advised having the City Manager draft a letter through the Orange Progress explaining the downturn.Councilmember Cavecche asked Council to consider adding to the Council's objectives and work plans for Fiscal Year 2002/03 a plan and implementation test case of one community outreach meeting where Councilrnembers would go out to an area of the City. It was suggested targeting the West Orange area for the outreach meeting. Staff could assist by setting the scope and topic. It would have to be well advertised and orchestrated. There are a lot of City activities going on in the west side of the City, i.e. Chapman Avenue expansion, The Block, UCI and the Uptown Orange plan. This could be used as a test case to see what type of response Council will get from the community and as the years progress other areas in the City could be targeted.Mayor Murphy noted basically that would take the community outreach meeting concept on some specific projects and make it geographically based rather than project oriented. PAGE 6 l-. CITY COUNCIL MINUTES APRIL 16, 2002 8. REPORTS FROM CITY MANAGER (Continued) Councilmember Coontz thought Assemblywoman Lynn Daucher should be invited to attend. Councilmember Slater thought the community outreach meeting on a one time trial basis is a good idea. Bob Bennyhoff, suggested asking OUSD to get an audit for the $500,000 and make sure the Cityknowswhotheauditoris. Mayor Murphy thanked City staff for their efforts in the budget process. He liked the idea of the community outreach meeting which would take some time and preparation. Mayor Murphy noted it was nice to bring the Library back as an independent department and congratulated GaryWann, Community Services Director who took over Library Services during past challengingtimes. Mayor Murphy encouraged everyone to continue to work hard moving forward because it will be challenging for a while. 9. LEGAL AFFAIRS - None 10. RECESS TO CLOSED SESSION The City Council recessed at 6:35 p.m. to a Closed Session for the following purposes:a. Conference with Legal Counsel pursuant to Government Code Section 54956.9 - existing litigation: City of Orange v. Airport Working group, Orange County Superior Court Case No.0lCC09018 b. 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.11. ADJOURNMENT The City Council adjourned at 7:45 p.m.U~1di (~ z:~ -<;AT CASSANDRA J. i\ THCART, CMC CITY CLERK MARK A.MAYO HY PAGE 7