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HomeMy WebLinkAboutMinutes - City Council - unsigned - 1995-12-05 City Council, Regular Meeting City Council Chambers 1313 California Street Redding, California December 5, 1995 7:00 p.m. The Pledge of Allegiance to the Flag was led by Sego Mazzini. The Invocation was offered by Pastor Dick McBride, North Valley Baptist Church. The meeting was called to order by Mayor Kehoe with the following Council Members present: P. Anderson, R. Anderson, McGeorge, Murray and Kehoe. Also present were City Manager Warren, Assistant City Manager Perry, Director of Administrative Services Starman, Director of Public Works Galusha, Acting Planning Director Keaney, Director of Electric Utility Lindley, Fire Chief Wagner, Assistant City Attorney Calkins, Electric Utility Resource Planner Gilfoy, Finance Officer Strong, Electric Utility Rates & Economics Analyst Graves, Management Assistant to the City Manager Bachman, Senior Planner King, City Treasurer Linville, Assistant City Clerk Moscatello, and Secretary to the City Council Rudolph. CONSENT CALENDAR The following matters were considered inclusively under the Consent Calendar: Approval of Payroll and Accounts Payable Register (A-050-100-500) It is recommended that Accounts Payable Register No. 10, for the period November 21, 1995, through November 30, 1995, check numbers 226841 through 227290 inclusive, in the amount of $3,363,357.12, and Payroll Register No. 11, check numbers 409459 through 410380 inclusive, totaling $1,238,974.86, for the period November 5, 1995, through November 18, 1995, be approved. TOTAL: $4,602,331.98 Treasurer's Report - October 1995 (A-050-100-600) Total Treasurer's Accountability - $ 70,886,772.69 Total City of Redding Funds, Funds Held in Trust, and Funds of Related Entities - $198,319,891.52 ACR113 Report and Cash Reconciliation (F-205-150-075) It is the recommendation of the Finance Officer that the ACR113 Report and Cash Reconciliation for October 31, 1995, be accepted. Property Status Report (C-070) It is the recommendation of the Assistant City Manager that the Report to City Council dated November 22, 1995, incorporated herein by reference, regarding the following areas be accepted: 1) Surplus City Property; 2) Offers to sell land to the City; 3) City initiated purchases of land; and 4) Lease of City land. Carpenter's Barn on Eastside Road (C-070-100 & C-070) It is the recommendation of staff that the City Council afford Tony Lewis the opportunity to determine if he wants to expend funds on remodeling the Carpenter's barn on Eastside Road for the use he has in mind in return for a possible lease of not more than ten years. If at the end of February 1996 a draft lease agreement has not been reached, staff is directed to bid for demolition of the structure. It is further recommended that the City waive the use permit fee for this research effort with the understanding the permit cost can be recaptured in the lease. Resolution - Decreasing 1995-96 Electric Utility Budget * (B-130-070 & A-050-125) It is the recommendation of the Electric Utility Director that Resolution No. 95-267 be adopted, a resolution of the City Council of the City of Redding approving and adopting the 19th amendment to City Budget Resolution No. 95-153 decreasing the Electric Utility's appropriation by $1,000,000 to lower the needed rate increase. 1996 Blanket Vendor Program (B-050-100) It is the recommendation of the Director of Administrative Services that the City Council approve the Blanket Vendor Program for 1996 as depicted in the Report to City Council dated November 28, 1995, incorporated herein by reference, approve amendments to the program throughout the calendar year as deemed necessary by the Purchasing Officer; and approve the lists of Authorized Employees, Authorized Approval Employees, Employees Authorized to Approve Requisitions via the computer system, and authorize amendment throughout the year as deemed necessary by the Purchasing Officer. 1996 Airport Liability Insurance (R-100-375-100) It is the recommendation of the Director of Administrative Services that the City Council authorize the City Manager to approve the purchase of airport liability insurance with a not-to-exceed amount of $40,000, and advise the City Council of the insurance company at its meeting on January 2, 1996. Resolution - Ordering Abatement at 2774 Akard Avenue, owned by Grady H. Cramer (A-030-070) It is the recommendation of the Acting Planning Director that Resolution No. 95-268 be adopted, a resolution of the City Council of the City of Redding approving the Report and Findings of the Board of Appeals, and ordering the abatement of the unsafe and unsightly building(s) and debris on property at 2774 Akard Avenue, owned by Grady H. Cramer. Resolution - Ordering Abatement at 1448 Old Alturas Road, owned by Ruby Smith (A-030-070) It is the recommendation of the Acting Planning Director that Resolution No. 95-269 be adopted, a resolution of the City Council of the City of Redding approving the Report and Findings of the Board of Appeals, and ordering the abatement of the unsafe and unsightly building(s) and debris on property at 1448 Old Alturas Road, owned by Ruby Smith. Resolution - Initiating Abatement Proceedings at 3407 Oasis Road, owned by Garland and Mary Gillum (A-030-070) It is the recommendation of the Acting Planning Director that Resolution No. 95-270 be adopted, a resolution of intention by the City Council of the City of Redding to begin legal proceedings of abatement on the real property located at 3407 Oasis Road, owned by Garland and Mary Gillum. Award of Bid - Bid Schedule No. 2965, Primary Splice Boxes (B-050-100) It is the recommendation of the Electric Utility Director that Bid Schedule No. 2965, primary splice boxes, be awarded to Cook Concrete Products, Inc., for the period January 1, 1996, to December 31, 1996, in the evaluated amount of $126,290.00. Funds for this purchase are provided for in the 1995-96 budget. Award of Bid - Bid Schedule No. 2966, Electric Utility Trench and Excavation (B-050-100) It is the recommendation of the Electric Utility Director that Bid Schedule No. 2966, electric utility trench and excavation, be awarded to California Property Marketing, for the period January 1, 1996, to December 31, 1996, in the evaluated amount of $108,950.60. Funds for this purchase are included in the 1995-96 budget. Cable Rate Increase - by Viacom Cablevision (T-040-050) It is the recommendation of the Director of Community Service that the City Council not exercise its option to regulate basic cable rates subject to the continuing practice of Viacom to provide the City with a 45-day notice of any rate increase. Resolution - Appropriating Funds for Retired Employees' Accrued Benefits * (B-130-070 & A-050-140) It is the recommendation of the Fire Chief that Resolution No. 95-271 be adopted, a resolution of the City Council of the City of Redding approving and adopting the 15th amendment to City Budget Resolution No. 95-153 appropriating $55,000 to pay for the retirement of two Fire Captains. Agreement - Participation Agreement re "Operational Area Level" of the Standardized Emergency Management System (SEMS) (P-150-050) It is the recommendation of the Fire Chief that the City Council approve the Participation Agreement with the County of Shasta, City of Redding, City of Anderson, and City of Shasta Lake to establish an Operational Area Organization for emergency services. Commissions, Boards and Committees (B-080) It is the recommendation of the City Clerk that the City Council accept the Report to City Council dated November 27, 1995, incorporated herein by reference, regarding Commissions, Boards and Committees appointed by the City Council, pursuant to Government Code Section 54972. Notice of Completion - Bid Schedule No. 2856, Construction of Quartz Hill/Keswick 115/12kV Transmission Line (B-050-020 & E-090-160-500) It is the recommendation of the Director of Public Works that Bid Schedule No. 2856 (Job. No. 9157-24), construction of the Quartz Hill/Keswick 115/12kV Transmission Line, awarded to D & B Electric, Inc., be accepted as satisfactorily completed and the City Clerk be authorized to file a Notice of Completion. The final contract price is $2,125,144. Resolution Accepting Streets and Acceptance of Improvements - Forest Homes, Phase 3 (East of Shasta View Drive at the intersection of Leonard Street) * (S-070-230 & S-100-208) It is the recommendation of the Director of Public Works that Resolution No. 95-272 be adopted, a resolution of the City Council of the City of Redding accepting for maintenance and operation Eternity Way, Leonard Street, and Forest Homes Drive in Phase 3 of the Forest Homes Subdivision. It is also recommended that the improvements in Forest Homes, Phase 3, be accepted as satisfactorily completed, and the City Clerk be instructed to return the securities to the developer, Donald Lynn. Award of Bid - Bid Schedule No. 2963, Installation of Metal Beam Guardrails on Various Streets in the City (B-050-020 & S-070-100) It is the recommendation of the Director of Public Works that Bid Schedule No. 2963 (Job No. 9524), installation of metal beam guardrails on various streets in the City, be awarded to Apex Fence Company, Inc. in the amount of $144,463, an additional $15,000 be approved to cover the cost of engineering and inspection fees, and $14,500 be approved to cover the cost of contract change orders, for a total of $173,963. Resolution - Extending Expenditure Limit of DeCuir & Somach Letter of Engagement for Legal Services (A-050-125 & E-120-150) It is the recommendation of the City Attorney that Resolution No. 95-273 be adopted, a resolution of the City Council of the City of Redding extending the letter of engagement with the Law Firm of DeCuir & Somach for legal services to the Electric Department to an amount not to exceed a total of $100,000. MOTION: Made by Council Member McGeorge, seconded by Council Member R. Anderson, that all the foregoing items on the Consent Calendar be approved and adopted as recommended. Voting was as follows: Ayes: Council Members - P. Anderson, R. Anderson, McGeorge, Murray & Kehoe Noes: Council Members - None Absent: Council Members - None Resolution Nos. 95-268, 95-269, 95-270, 95-271, 95-272, and 95-273 are on file in the Office of the City Clerk. - - - - - - - - - - SHASTA COUNTY WOMEN'S REFUGE - Request for Funding (B-130-030) City Manager Warren provided an overview of the Report to City Council dated December 1, 1995, incorporated herein by reference, regarding the Shasta County Women's Refuge request for an additional $16,000 in funding. He explained that the request is due to the County of Shasta's inability to fund their portion of the operational costs of the Women's Refuge ($30,000). Mr. Warren related that in August of this year the Shasta County Women's Refuge was approved to receive $35,000 through the City's Community Development Block Grant (CDBG) Program. Additionally, the hourly rate for sexual assault crisis intervention services was increased from $15.00 per hour to $30.00 per hour in September. He noted that the $30.00 per hour rate will probably require the utilization of the entire $5,000 allocated in the Police Department's budget. Mr. Warren recommended that the City Council approve the request for an additional $16,000 in funding. While acknowledging the precedent of picking up costs for another agency, he believed the services provided by the Women's Refuge are too valuable to jeopardize. He also suggested that the City Council request the Women's Refuge to begin their lobbying efforts with the County immediately for next year's funding. He indicated that if the County is unable or unwilling to participate financially, perhaps it can provide assistance through the designation of an employee to the Women's Refuge or some other non-cash benefit. If the County is unable to do this, he suggested that the Women's Refuge consider the possibility of serving only the Cities of Redding and Anderson, and not the unincorporated areas. Mary Stegall, Executive Director of the Women's Refuge, explained that the request for an additional $16,000 is the result of the County of Shasta being unable to fund the $30,000 allocation from their General Operating Budget. She clarified that the County of Shasta does, however, provide the following funding to the Women's Refuge: 1) CSBG funds - $17,000; 2) FEMA - $5,000; 3) Emergency Shelter Assistance Program grant - $20,000; and 4) Marriage License Fees - $17,000. She stressed that the $30,000 expected from the County of Shasta provided the majority of the cash match ($42,500) mandated by the Office of Criminal Justice Planning for their Domestic Violence Program Grant in the amount of $85,000. She related the difficulty of acquiring monies that are not designated for a specific program, but rather used for on- going operating expenses. In response to Council Member R. Anderson, Ms. Stegall anticipated going back to the County of Shasta in the upcoming fiscal year and requesting funding from their general budget, as well as lobbying the Board of Supervisors. She also suggested that the City and the County meet to discuss the Women's Refuge and its importance to the community. Council Member R. Anderson stated he supported the program; however, he was concerned about the message which would be sent to the County if the additional funding is approved. He opined that the County is continually attempting to shift the costs of such programs to the cities. In response to Council Member P. Anderson, Ms. Stegall indicated that the City of Shasta Lake has expressed a desire to provide funding in the amount of $2,500; however, to date, no monies have been received. Council Member Murray stated that spousal abuse is a societal problem and he believed the community should be more involved in providing assistance. He supported approving the request for the additional $16,000 in funding for this fiscal year, however, he recommended that the Women's Refuge develop a program which seeks the support of various churches and community service clubs. Mayor Kehoe asked the City Council to focus on the good which is provided to the community by the Women's Refuge. MOTION: Made by Council Member Murray, seconded by Council Member P. Anderson, to approve the Women's Refuge's request for an additional $16,000 in funding for the 1995-96 fiscal year. The Vote: Unanimous Ayes REQUEST TO ADDRESS THE CITY COUNCIL - by Golden State Mobilehome Owners League re Proposition 199 (L-040-300 & A-050-060) Bob Kerr, Regional Manager of the Golden State Mobilehome Owners League, stated that he represents the residents of mobilehome parks in the City of Redding who are opposed to Proposition 199 pertaining to mobilehome rental assistance and rent control restriction. He stressed that the issue is not rent control, but the preemption of the City's ability to take action on a rent control program if it is deemed necessary. He related that the League of California Cities is one of many organizations/individuals on record as opposing Proposition 199. He requested that the City Council adopt a resolution opposing Proposition 199. No action was taken on this matter. PUBLIC HEARING - re Rezoning Application RZ-5-95, by Signature Northwest (3350 and 3370 Nicolet Lane) (L-010-230) Council Member Murray abstained from discussion and voting on this matter. The hour of 7:00 p.m. having arrived, Mayor Kehoe opened the public hearing regarding Rezoning Application RZ-5-95. The following documents are on file in the office of the City Clerk: Affidavit of Mailing - Notice of Public Hearing Affidavit of Publication - Notice of Public Hearing Planning Commission recommendation dated November 22, 1995 Assistant City Clerk Moscatello advised that no protests were received. Acting Planning Director Keaney related that the Planning Commission, at its meeting of October 10, 1995, recommended that the property located at 3350 and 3370 Nicolet Lane be rezoned from "U-FP" Unclassified District to "R1-B20" Single-Family Residential District. The rezoning is required by the Conditions of Approval for River Meadows Estates Subdivision in order to update the zoning maps to reflect the new development. It is the recommendation of both the Planning Commission and staff that the City Council ratify the Negative Declaration, offer the ordinance for first reading and waive the full reading of said ordinance. Mayor Kehoe determined that there was no one present wishing to speak on the matter and closed the public hearing. MOTION: Made by Council Member McGeorge, seconded by Council Member R. Anderson, that the City Council make the following findings regarding RZ-5-95: 1. Project is compatible with the Redding General Plan; 2. Project will not significantly alter existing land form; 3. Project is compatible with surrounding land use; 4. Project is compatible with the Code of the City of Redding, California; and ratify the Negative Declaration authorized by the Planning Commission on October 10, 1995. Voting was as follows: Ayes: Council Members - P. Anderson, R. Anderson, McGeorge and Kehoe Noes: Council Members - None Absent: Council Members - None Abstain: Council Members - Murray Council Member McGeorge offered Ordinance No. 2141 for first reading, an ordinance of the City Council of the City of Redding amending Section 18.06.020 of the Redding Municipal Code relating to the rezoning of certain real property in the City of Redding, rezoning said property to "R1-B20" Single-Family Residential District (RZ-5-95). MOTION: Made by Council Member McGeorge, seconded by Council Member R. Anderson, that the full reading of Ordinance No. 2141 be waived and the City Attorney be instructed to read the full title. Voting was as follows: Ayes: Council Members - P. Anderson, R. Anderson, McGeorge and Kehoe Noes: Council Members - None Absent: Council Members - None Abstain: Council Members - Murray PUBLIC HEARING - re Rezoning Application RZ-11-95 by the City of Redding and Joseph Brugaletta and the City of Redding (1410 through 1464 Victor Avenue and 1299, 1305 & 1321 Old Alturas Road) (L-010-230) The hour of 7:00 p.m. having arrived, Mayor Kehoe opened the public hearing regarding RZ-11-95. The following documents are on file in the office of the City Clerk: Affidavit of Mailing - Notice of Public Hearing Affidavit of Publication - Notice of Public Hearing Planning Commission recommendation dated November 22, 1995 Assistant City Clerk Moscatello advised that no protests were received. Acting Planning Director Keaney related that the Planning Commission at its meetings of October 10 and 24, 1995, recommended rezoning nine properties located at the southwest corner of Victor Avenue and Old Alturas Road from "U" Unclassified District and "R3-40-B15-F" Multiple- Family Residential District with Site Plan Review Combining District to "R3-40" Multiple-Family Residential District. He explained the main purpose of the rezoning is to eliminate the "B-15" Combining District and to eliminate the "F" Site Plan Review Combining District. Mr. Keaney stated that the owners of the two parcels developed with the Montessori School, Thomas Kaut and Henry and Marion Darancette, have requested that their property be eliminated from the rezoning. He indicated that the request, however, was not made until after the Planning Commission hearing. Mr. Keaney explained that the request by the preschool property owners to be removed from the proposed "R3-40" District is essentially moot as long as the property is classified "Residential, 9.0 units per acre" under the General Plan. In the opinion of staff, it is inappropriate to retain a "U" classification if the reason is that it might be a good location for a General Plan amendment. It is the recommendation of staff that the City Council approve the rezoning request, rezoning the property to "R3-40" Multiple-Family Residential District, ratify the Negative Declaration, offer the ordinance for first reading, and waive the full reading of said ordinance. Marion Darancette stated that she did not have anything to say based on the fact that the same process would have to be followed if the school were to cease to exist. She indicated that she felt it was important, however, to inform the City Council that it was not necessary to include that the Montessori School in the rezoning request. Joseph Gyves opined that given the development occurring in the area and its high visibility, the entire block should be considered for classification as office/residential. Council Member R. Anderson recommended that both Ms. Darancette and Mr. Gyves make their requests known to the General Plan Committee. Mayor Kehoe determined that there was no one else present wishing to speak on the matter and closed the public hearing. MOTION: Made by Council Member R. Anderson, seconded by Council Member P. Anderson, that the City Council make the following findings regarding RZ-11-95: 1. Project is compatible with the Redding General Plan; 2. Project will not significantly alter existing land form; 3. Project is compatible with surrounding land use; 4. Project is compatible with the Code of the City of Redding, California; and ratify the Negative Declaration authorized by the Planning Commission on October 24, 1995. The Vote: Unanimous Ayes Council Member R. Anderson offered Ordinance No. 2142 for first reading, an ordinance of the City Council of the City of Redding amending Section 18.06.020 of the Redding Municipal Code relating to the rezoning of certain real property in the City of Redding to "R3-40" Multiple-Family Residential District (RZ-11-95). MOTION: Made by Council Member R. Anderson, seconded by Council Member P. Anderson, that the full reading of Ordinance No. 2142 be waived and the City Attorney be instructed to read the full title. The Vote: Unanimous Ayes REAPPOINTMENT - Shasta County Commission on Aging (B-080-470) MOTION: Made by Council Member McGeorge, seconded by Council Member P. Anderson, to reappoint Housing Programs Supervisor Kit Garrity to serve as the City's representative to the Shasta County Commission on Aging for a two-year term expiring January 1, 1998. The Vote: Unanimous Ayes RATIFICATION OF APPOINTMENTS - Community Development Advisory Committee (B-050-600-100) MOTION: Made by Council Member R. Anderson, seconded by Council Member P. Anderson, to ratify the appointment of Rick Bosetti, Planning Commission representative, and Larry Sterk, Redding Redevelopment Agency representative, to serve on the Community Development Advisory Committee for terms expiring December 1, 1996. The Vote: Unanimous Ayes REAPPOINTMENT - Shasta Mosquito Abatement District (B-080-480) MOTION: Made by Council Member McGeorge, seconded by Council Member P. Anderson, to reappoint Winifred Woods as the City's representative to the Shasta Mosquito Abatement District for a two-year term expiring December 1997. The Vote: Unanimous Ayes GENERAL FUND MONTHLY FINANCIAL REPORT - October 1995 (B-130-070) Director of Administrative Services Starman provided an overview of the Report to City Council dated November 21, 1995, incorporated herein by reference, which detailed the General Fund Monthly Financial Report for October 1995. In summary, total revenue to date is $8,400,000, which is slightly lower (1.8 percent) than staff's original cash flow estimate, and expenditures to date total $11,622,409, or $384,292 (3.3 percent) below staff's original cash flow projection. City Manager Warren added that the Ten-Year Financial Plan reflects the valley year of 1998-1999 having a reserve of 7.8 percent. MOTION: Made by Council Member R. Anderson, seconded by Council Member Murray, to accept the General Fund Monthly Financial Report for October 1995. The Vote: Unanimous Ayes ELECTRIC UTILITY MONTHLY FINANCIAL REPORT - October 1995 (B-130-070) Director of Administrative Services Starman highlighted the Report to City Council dated November 27, 1995, incorporated herein by reference, regarding the Electric Utility Monthly Financial Report for October 1995. Council Member R. Anderson requested that future reports contain information that will assist the City Council in its oversight responsibilities. He cited the following example: How much does it cost the City to produce energy by the kilowatt at the Redding Power Plant versus purchasing the electricity on the market. Mr. Starman stated that staff would work with the City's outside auditors to incorporate such information into the report. MOTION: Made by Council Member McGeorge, seconded by Council Member P. Anderson, to accept the Electric Utility Monthly Financial Report for October 1995. The Vote: Unanimous Ayes UPPER AND MIDDLE STILLWATER ANNEXATION NO. 91-5 (A-150-255) City Manager Warren provided an overview of his memorandum dated November 28, 1995, incorporated herein by reference, wherein he recommended that the City Council authorize staff to negotiate an agreement with Shasta College for payment of services in lieu of property taxes over the next 20 years if the Upper and Middle Stillwater Annexation No. 91-5 were to proceed. He explained that the agreement will assist the City in determining if the original proposed annexation or a small annexation centered around Shasta College should be considered. Additionally, Mr. Warren recommended that if the City Council is comfortable with the information to be presented that staff be directed to begin processing the necessary environmental reviews for the larger annexation under the assumption that the City can always step back to the smaller annexation, or stop proceedings before it is submitted to LAFCO. He also indicated that if the City Council needs further explanation, review, or discussion, staff can schedule a workshop in January to review the material and spend more time on the issue. Council Member R. Anderson believed that the entire subject of annexations needs to be reviewed, and, if necessary, approach the County of Shasta about renegotiating the current property tax exchange agreement. Council Members McGeorge and P. Anderson concurred. Acting Planning Director Keaney provided a background of the proposed Upper and Middle Stillwater Area annexation, the results of the annexation survey, and alternative annexation boundary configurations, as contained in the Report to City Council dated November 27, 1995, incorporated herein by reference. Associate Planner Morgon reviewed the financial analysis of the annexation. Mr. Morgon noted that Alternative No. 1 would result in a cumulative 20-year shortfall of $2.5 million, while Alternative No. 2 would result in a $687,000 shortfall. Assistant City Manager Perry highlighted the financial analysis of not annexing. Council Member P. Anderson stated that she would like to see some statement which indicates that annexing the area would not have an effect on electric utility rates. Council Member Murray questioned whether the City completes a Preliminary Public Works Survey on all annexations to determine the amount of work required by the City. He noted that staff needs to review its assumption regarding the time line for a fire station in the area. Due to the current contractual agreement regarding Tierra Oaks, he stated that the construction of a fire station will need to occur in five to six years. Council Member P. Anderson requested staff to address whether the annexation would affect the City's fire rating. Frank Sawyer, of Sharrah, Dunlap and Sawyer, requested that if the City proceeds with Alternative No. 2, which involves the annexation of Shasta College, that the planning aspects of Areas A and B, as depicted on the Alternative No. 1 map, be included and considered for high density residential development. Bob Nash stated that he is a property owner in the area depicted as "B" in Alternative No. 1 Map. He related this his family's sole interest in the annexation is to obtain sewer service which will then permit the property to be developed. He noted that one of the major problems in the area is the condition of the soil and the associated effects on the environment. He indicated that staff should look at ways to make an annexation work, rather than look for ways to prove it will not work. Carl Arness recommended that the City also consider providing service to Shasta College without requiring annexation as an alternative. In response to Council Member Murray, Mr. Perry stated that the environmental review of the annexation could probably be accomplished utilizing a Negative Declaration or referencing an Environmental Impact Report (EIR) that covers the Shasta College and Area "A." He noted that, however, Area "B" is not included in the EIR. Council Member Murray did not want to detour the issue of annexing Shasta College and, therefore, favored proceeding with negotiations with the College. He related that any analysis which proposes to address the impacts on the current City limits should include all available options and the current report does not address the issue of providing services to the college without requiring annexation. He noted that unless the annexation is tied to an increase in the number of police officers on patrol, the annexation will further reduce the City's current level of police service. He also requested to see what impact the annexation would have on the City's Ten-Year Financial Plan. He opined that reopening discussions with the County on the Property Tax Exchange Agreement would not be beneficial; however, the City could request the County to enact fees within the City's sphere of influence which would be utilized by the City to benefit that particular area. Council Member R. Anderson noted that if the City were to consider providing services without requiring annexation, it must consider whether the County would be able to provide the necessary services, i.e., police and fire protection. MOTION: Made by Council Member R. Anderson, seconded by Council Member McGeorge, to direct staff to proceed with investigating the possibility of annexation with regard to the Upper and Middle Stillwater Annexation No. 91-5, negotiate an agreement with Shasta College and schedule a workshop as soon as possible to discuss the entire issue of annexation. The Vote: Unanimous Ayes At the hour of 8:57 p.m., Mayor Kehoe declared the meeting recessed. At the hour of 9:10 p.m., Mayor Kehoe reconvened the meeting to regular session. RESOLUTION - Power Purchase/Sale/Exchange Agreement with PacifiCorp (E-120 & E-120-500) City Manager Warren thanked the group of citizens who came to City Hall to hear staff's presentation regarding the Power Purchase/Sale/Exchange Agreement with PacifiCorp. Electric Utility Director Lindley's Report to City Council dated November 30, 1995, and memorandum to City Council dated December 1, 1995, incorporated herein by reference, provided information regarding the proposed Power Purchase/Sale/Exchange Agreement with PacifiCorp. Under the agreement, Redding will: 1) make a $43 million prepayment to PacifiCorp; 2) make $50,000 monthly payments through November 2000; 3) continue to make monthly payments for energy per the existing Long-Term Power Sales Agreement through November 2000; and 4) provide PacifiCorp with the right to San Juan power between December 1995 and November 2015. In consideration of the foregoing, PacifiCorp will: 1) provide 50 MW of capacity to Redding for a 20-year period commencing December 1995; 2) provide Redding with a billing credit under the Existing Sales Agreement for San Juan energy delivered to PacifiCorp through November 2000; and 3) deliver annual energy to Redding in amounts equal to the annual San Juan energy delivered between December 2000 and November 2015. Electric Utility Resource Planner Gilfoy made a viewgraph presentation to the City Council regarding the proposed agreement with PacifiCorp which included the following: 1) Projected rate impacts under the existing and new PacifiCorp arrangements; 2) Map depicting PacifiCorp Electric Operations; 3) Graph showing City's $45 million electric power production expenses; 4) Payback period versus prepayment; 5) Associated risks; 6) PacifiCorp's financial attributes; and 5) Typical customer cost reduction from 1996-2005. He summarized that under the proposed arrangement with PacifiCorp, the City can realize more than $63 million in net power cost reduction over the next 20 years. He related that this is possible through a $43 million prepayment to PacifiCorp and exchanging the City's San Juan resource for deliveries of power from the PacifiCorp system. In response to Council Member R. Anderson, Mr. Gilfoy related that if the transaction does not receive approval from the Federal Energy Regulatory Commission (FERC), the City would be responsible for approximately $50,000 to $75,000 in underwriting expenses. Jim Gibbs, representing Lehman Brothers, outlined the steps to be taken by the City Council with regard to the proposed agreement and the associated financing. He believed PacifiCorp's "A Rating" was very good given the scrutiny occurring with regard to electric utility companies and the current deregulation taking place, and PacifiCorp appears to be very well positioned in the electric utility industry in that it does not own any nuclear power facilities. He also noted that this business arrangement assists PacifiCorp to compete for a marketplace in the Southwestern United States. In response to Council Member R. Anderson, Mr. Gibbs stated he did not have PacifiCorp's financial information with him this evening. Kimball Rasmussen, PacifiCorp's Director of Power Marketing and Sales, provided the following facts regarding PacifiCorp: 1) As of 1994, wholesale marketing and sales for PacifiCorp totaled approximately $500,000 million, or 20% of total revenues; 2) Successful in garnering 46 percent of the load available from Bonneville Power Administration this year; 3) PacifiCorp has 13 percent of the investor-owned utility retail market share in the Western United States, as opposed to PG&E and Southern California Edison both at 21 percent; 4) Operates in seven western states; 5) In every jurisdiction served by PacifiCorp, its retail rates are below average; 6) Of the ten lowest cost thermal operating power plants in the Western United States, PacifiCorp owns 43 percent of those ten units; and 7) PacifiCorp's capital is approximately $16 billion (debt and equity). Mr. Rasmussen did not believe the City would find another utility in the Western United States that is rated significantly higher than PacifiCorp. He cited a recent study by Merrill-Lynch which included 109 investor-owned utilities nationwide and PacifiCorp ranked number nine. Mr. Warren summarized that without the PacifiCorp agreement, power costs would increase approximately 13 percent. He believed the risks to be minimal and recommended that the City Council adopt the necessary resolution authorizing the City to enter into the agreement with PacifiCorp. Paul Edgren believed the proposed agreement would be very beneficial for the City. He questioned, however, how the City could approve providing funds in the amount of $43 million without first reviewing the company's financial statement. He suggested that PacifiCorp provide some type of security for the $43 million prepayment. Frank Strazzarino, Executive Director of the Greater Redding Chamber of Commerce, thanked the City Manager for presenting the material to members of the community prior to the City Council meeting. The Chamber's Government Relations Committee has reviewed the proposal and its primary concern is the risk element; however, the Committee did acknowledge that not proceeding with the agreement was a risk itself. Mr. Gilfoy clarified that the City is not in reality making a $43 million investment. Under the existing contract, the City has an obligation over the next four and one half years to pay approximately $50 million, or on a discounted basis $40 million. MOTION: Made by Council Member Murray, seconded by Council Member McGeorge, that Resolution No. 95-274 be adopted, a resolution of the City Council of the City of Redding approving entering into the following agreements between the City and PacifiCorp (proposed agreements): A Short-Term Power Sales Agreement, a Long-Term Power Purchase Agreement, a Long-Term Power Sales and Exchange Agreement, and a Service Agreement under Federal Energy Regulatory Commission (FERC) Tariff PPL-3. Voting was as follows: Ayes: Council Members - P. Anderson, R. Anderson, McGeorge, Murray and Kehoe Noes: Council Members - None Absent: Council Members - None Resolution No. 95-274 is on file in the office of the City Clerk. At the hour of 10:02 p.m., Mayor Kehoe adjourned the meeting to a special meeting of the Redding Joint Powers Financing Authority. At the hour of 10:05 p.m., Mayor Kehoe reconvened the regular meeting of the Redding City Council. RESOLUTION - Approving Documents for Issuance of Debt to Finance Power Purchase/Sale/Exchange Agreement with PacifiCorp * (D-050-200 & E-120 & R-015-300) Electric Utility Director Lindley's Report to City Council dated November 30, 1995, explained that in order for the debt issues to proceed, the City Council must approve a resolution which authorizes the following: 1) The issuance of bonds by the Redding Joint Powers Financing Authority in an amount not to exceed $48,445,000 with a maximum true interest cost of 7.50 percent; 2) The Bond Anticipation Note; and 3) The form of an Installment Sale Agreement. Risk Hiscock, representing special bond counsel Orrick, Herrington & Sutcliffe, explained the documents which were before the City Council for consideration. MOTION: Made by Council Member McGeorge, seconded by Council Member Murray, that Resolution No. 95-275 be adopted, a resolution of the City Council of the City of Redding approving the form of an Installment Sale Agreement for the acquisition of certain municipal electric system improvements and authorizing the execution and delivery thereof, and approving the issuance by the Redding Joint Powers Financing Authority of not to exceed $48,000,000 aggregate principal amount of electric system revenue bonds and bond anticipations notes related thereto, and approving the form of an official statement for the bonds and related actions and matters. Voting was as follows: Ayes: Council Members - P. Anderson, R. Anderson, McGeorge, Murray and Kehoe Noes: Council Members - None Absent: Council Members - None Resolution No. 95-275 is on file in the office of the City Clerk. ROUTINE REPORTS AND COMMUNICATIONS (B-080-465 & A-050-300-250) Assistant City Clerk Moscatello related that a letter was received from Hilary Mosher, Executive Director of the Shasta County Arts Council, expressing appreciation to the City Council for reappointing Community Services Director John Gorman to the Shasta County Arts Council and commending him for his outstanding contributions. Ms. Moscatello further stated that a letter was received from Frank Wilson, Real Estate Investments, expressing appreciation to Bob Galusha and the Public Works Department for street improvements on Athens Avenue. CLOSED SESSION (L-100) City Attorney Wingate requested that the closed session concerning the case of City of Redding v. Orion Corporation, et al, Superior Court Case 122988, be continued to the adjourned meeting on December 12, 1995, to allow time for staff to receive the appraisal information. Mr. Wingate related that subsequent to the posting of the December 5, 1995, agenda, it became known that it would be necessary to hold a closed session regarding existing litigation in the case of City of Redding v. Shasta Enterprises, and related cross-action, Shasta County Superior Court Consolidated Case Nos. 87226 and 95735. He explained that, in accordance with Government Code Section 54954.2, in order for the City Council to discuss this matter, it would require a 4/5 vote of the City Council to place the matter on this evening's agenda. MOTION: Made by Council Member R. Anderson, seconded by Council Member Murray, to place the following matter on the December 5, 1995, agenda: Conference with Legal Counsel -Existing Litigation: City of Redding v. Shasta Enterprises, and related cross-action, Shasta County Superior Court Consolidated Case Nos. 87226 and 95735. Voting was as follows: Ayes: Council Members - P. Anderson, R. Anderson, McGeorge, Murray and Kehoe Noes: Council Members - None Absent: Council Members - None MOTION: Made by Council Member Murray, seconded by Council Member McGeorge, to defer consideration of the following matter until December 12, 1995: Conference with Legal Counsel - Existing Litigation: City of Redding v. Orion Corporation, et al, Superior Court Case 122988. The Vote: Unanimous Ayes At the hour of 10:12 p.m., Mayor Kehoe declared the meeting recessed. At the hour of 10:20 p.m., Mayor Kehoe reconvened the meeting to regular session. Mayor Kehoe stated that the City Council would adjourn to closed session pursuant to California Government Code Section 54956.9(a) to discuss the following: Conference with Legal Counsel -Existing Litigation: City of Redding v. Shasta Enterprises, and related cross-action, Shasta County Superior Court Consolidated Case Nos. 87226 and 95735. At the hour of 10:20 p.m., Mayor Kehoe adjourned the meeting to closed session. At the hour of 11:23 p.m., Mayor Kehoe reconvened the meeting to regular session. No action was taken. ADJOURNMENT There being no further business, at the hour of 11:23 p.m., Mayor Kehoe adjourned the meeting to 5:15 p.m., December 12, 1995, in City Hall Conference Room A, 760 Parkview Avenue, Redding, California. APPROVED: Mayor Kehoe ATTEST: Assistant City Clerk