HomeMy WebLinkAboutMinutes - City Council - unsigned - 1993-04-30 - Adjourned Regular Meeting1
04/30/93
City Council, Adjourned Regular
Meeting
City Hall Conference Room A
Redding, California
April 30, 1993 4:20 p.m.
The meeting was called to order by Mayor Arness with the following Council
Members present: Anderson, Kehoe and Arness. Council Members Dahl and Moss
were absent.
Also present were City Manager Christofferson, Assistant City Manager McMurry,
City Attorney Hays, Director of Planning and Community Development Perry,
Budget Services Officer Starman, Public Information Officer Bachman and City
Clerk Strohmayer.
STATE BUDGET ISSUES
(L-040-300)
Mayor Arness thanked State Assemblyman Stan Statham for taking the time to
meet with Council to discuss potential problems stemming from the State's
proposed budget reductions.
City Manager Christofferson noted the following concerns: 1) The substantial
cost of the proposed reductions would be a real problem for every city,
county, and special district throughout the State of California. He provided
Assemblyman Statham with a chart depicting the reductions the City of Redding
has endured from fiscal year 1990-91 to present, representing a four-year loss
of $6,104,192; and 2) Property tax reduction at the local government level is
counter productive in terms of the Governor's plan to revive California's
economy. Job creation is key in reviving the economy. However, if funding is
reduced, local governments will not tolerate new industry as it will be too
costly.
Planning and Community Development Director Perry provided the following
comments regarding redevelopment funding: 1) It allows the City to meet the
State's housing mandates both within redevelopment law and the Housing Element
review; and 2) Provides matching funding for much-needed highway projects.
He stated that Redding only receives $0.19 of every $1.00 of property tax
monies. He related that the schools on a statewide average receive $0.33 of
every $1.00. Of particular interest is the fact that Shasta County schools
receive $0.55 of every $1.00. Within some annexation areas, schools are
receiving 70 percent of the property tax monies, thereby leaving the City and
County with virtually no monies to provide public safety services. Redding's
population is projected to be 100,000+ by the year 2005, increasing
approximately 25,000 every decade.
Assemblyman Statham related that when the State of California was formed 143
years ago, the entire population of the State was 100,000.
Mayor Arness remarked that the City has always enjoyed a history of sound
fiscal management and past City Councils have had the financial tools
necessary to provide essential services. He stressed there is no fat in the
City's budget as it was reduced by $7,500,000 this year, which leaves no room
for further cuts. The city is now faced with another $1,500,000 expense in
order to comply with the new American with Disabilities Act. The City should
not nor can it absorb any further revenue confiscations by the State.
Council Member Anderson stated that the City has reached a point where any
more budget reductions would cause reductions in police and fire protection.
With regard to economic development, he indicated that businesses need an
incentive to remain in California.
Assemblyman Statham expressed appreciation for the charts depicting the
revenue reductions the City has experienced in the last four fiscal years. He
stated that it is impossible to describe the crisis the State is in because of
businesses leaving the State and the State's population continuing to
increase. He, as well as Speaker of the Assembly Willie Brown and
approximately 30 other State legislators, recently had the opportunity to meet
with President Clinton to discuss the following: 1) Monies to cover the
costs incurred by California citizens as a result of immigration.
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Approximately 50 percent of the immigrants coming to America locate in the
State of California. As a result of discussion and compromise, President
Clinton has promised approximately $800,000,000; and 2) The closure of
military bases in California.
Assemblyman Statham opined that Governor Wilson was given some bad advice when
he proposed to take local government monies and provide them with the ability
to raise taxes. These monies would be used to fill the $8,000,000,000 to
$9,000,000,000 deficit. He stated that he is currently not prepared to vote
for the transfer of revenues and acknowledged that schools need the funding,
however, it should not be derived from local government. Under Proposition
98, schools have constitutional protection and receive 40 percent of the
State's budget.
Assemblyman Statham indicated his position on the following: 1) He would not
vote in favor of Governor Wilson's proposal to prioritize local government
budgets; 2) He would not support any raid of local governmental money unless
comparable revenue can be saved through worker's compensation reform, welfare
reform, health care system, etc.; and 3) Unless there are substantial
reforms made that could improve the business climate in California, he would
not vote for
the 1993-94 budget. He did not believe the State would find itself in another
budget gridlock because of the platforms on which the newly elected Assembly
members ran. In addition, Governor Wilson and Speaker of the Assembly Brown
are now communicating on issues. Relative to worker's compensation, he
acknowledged that it is the number one problem not only in government but in
the private sector as well. He expects bills to be passed and signed into law
by the end of June which provide positive reform in worker's compensation.
Although not prepared to vote in favor of it today, he related that there are
circumstances under which he would vote to extend the 1/2 cent sales tax in
California which would provide approximately $1,500,000,000.
Assemblyman Statham explained that for the past three to four years, the State
has had a multi-billion dollar budget deficit and then passed a budget. Seven
to eight months later it is determined that there will be another
$8,000,000,00 to $9,000,000,00 deficit in the coming fiscal year. This means
that the adopted budget was not balanced or fiscally sound. There have been
proposals suggested that would allow a balanced budget to be adopted, and if
revenues are lower or higher, automatic reductions or increases would
automatically be made. He explained that it is impossible to foresee
everything which will occur 18 months in advance, particularly in a State with
a budget of $56,000,000,000 and a population of 31 million.
Council Member Kehoe posed the following questions: 1) How can the City
combat the confiscation of its local resources; 2) What is the probability
that the confiscation of resources can be successfully combated; and 3) Why
can't the State legislature manage State affairs in an efficient fashion?
Assemblyman Statham related that the coalition established at the local
government level represents a good lobbying voice. Because of the severity of
the State's budget and the number of new members in the house, he estimated
the chances of successfully combating the confiscation at 50/50. In response
to properly managing State affairs, he indicated that the State is too large.
He commented that the June or July edition of National Geographic
will
discuss his proposal to divide the State of California into more than one
state.
Don D. Davis, President of the Shasta County Board of Realtors, explained that
a year ago there was approximately $200,000,000,000 of new construction on the
books in the State of California. Current construction loans outstanding are
only $37,000,000,000. This drop of $163,000,000,000 represents a large number
of jobs. These figures are devastating to the business community of
California. He cited the fact that Entel did not build its $1,200,000,000
plant in Folsom, but opted to locate in New Mexico because of a $200,000,000
savings. He noted that the closure of military bases is also contributing to
the problem.
Assemblyman Statham stated that approximately four weeks ago, nine nationally
known economists issued a report indicating that California would continue to
decline economically until the turn of the century. President Clinton
recently assured State legislators that he understands the severity of
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California's problems. Speaker of the Assembly Brown suggested that President
Clinton utilize the City and/or County of Los Angeles when developing any
programs or incentives. If a program works in Los Angeles, it would work
anywhere in the State. He noted that there items which could be eliminated at
the State level. The Governor is proposing the elimination of 70+ State
boards and commissions as part of this effort. He mentioned that the
California Energy Commission has expended hundreds of millions of dollars to
enable California to become more energy self-sufficient. However, the State
is less energy sufficient today than it was before the commission was formed.
Vicky Cook, Shasta County Board of Realtors, questioned the status of the
immigration law which required individuals to be gainfully employed or have
money in the bank before entering the United States.
Although not an expert on immigration law, Assemblyman Statham related that
there are still laws on the books which require an individual to have a
sponsor or proof of support for six months to a year. A study is currently
being conducted regarding immigration which should allow the State to lobby
the Clinton administration for more funding or reform of the nation's
immigration laws.
Marie Whitacre, Executive Director of Shasta County Board of Realtors,
questioned what would occur if local governments refused to relinquish any
additional revenues. Assemblyman Statham replied that the problem would
probably end up in the court system.
Tom Semingson, President of the Greater Redding Chamber of Commerce, stated
that when he presented the issue of the State reducing the amount of property
taxes paid to local governments to his 20 person board, representing 1300
members, it was the first time in three months that he did not have a split
vote but had a unanimous vote against the State's action. He explained it is
important for State legislators to recognize that the business community does
not support the State's approach to this matter.
Council Member Anderson relayed that the business community could accept an
extension of the 1/2 cent sales tax with the assurance that the raid on local
revenues be discontinued.
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Assemblyman Statham expressed appreciation for the opportunity to meet with
Council and discuss important issues, as the City of Redding is the most
important city and geographic location between Sacramento and the State of
Oregon.
ADJOURNMENT
There being no further business, at the hour of 5:45 p.m., Mayor Arness
declared the meeting adjourned.
APPROVED:
____________________________
Mayor
ATTEST:
_______________________________
City Clerk