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HomeMy WebLinkAboutMinutes - City Council - 1996-02-26 43 City Council Special Meeting City Hall Conference Room A 760 Parkview Avenue Redding, California February 26, 1996 8:00 a.m. 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, City Attorney Wingate, Director of Public Works Galusha, Director of Electric Utility Lindley, Police Chief Blankenship, Fire Chief Wagner, Acting Planning Director Keaney, Administrative Servies Director Starman, Finance Officer Strong, Senior Planner King, Management Assistant to the City Manager Bachman, and City Clerk Strohmayer. CLOSED SESSION (A-050-080) Mayor Kehoe stated that the City Council would adjourn to closed session pursuant to California Government Code Section 54957 to discuss the City Manager's performance evaluation. At the hour of 8:00 a.m. , Mayor Kehoe adjourned the meeting to closed session. At the hour of 9:30 a.m. , Mayor Kehoe reconvened the meeting to regular session. Mayor Kehoe stated that the City Council would continue its discussion regarding the City Manager's performance evaluation at 6:00 p.m. , on March 5, 1996. UPPER/MIDDLE STILLWATER CREEK ANNEXATION NO. 95-1 AND ANNEXATION POLICY ISSUES (A-150-252 & A-150) City Manager Warren related that the assumptions which will be presented regarding the Upper/Middle Stillwater Creek Annexation have been prepared without the use of a consultant. He noted that the assumptions do not presume a reimbursement agreement has been reached with Shasta College (College) . He emphasized that staff would spend as much time as necessary with the City Council on this issue to ensure that the final decision is the best one for the community in the long term. Assistant City Manager Perry stressed that the conclusions are based on real numbers and assumptions; therefore, it is important that the City Council concur with the assumptions. He noted that the issues facing the City in terms of annexation are the financial risks and/or gains. He explained that part of the decision regarding the Stillwater annexation involves the formation of a sewer assessment district to connect properties both inside and outside the City; formation of a Mello-Roos District; and develop an agreement with Shasta College. He emphasized that both the County and LAFCO will also be required to approve the annexation. Associate Planner Morgan provided a background history of the Upper/Middle Stillwater Creek Annexation. He noted that Shasta College is a key factor in the annexation, as it is currently under a Cease and Desist Order issued by the Water Quality Control Board to make significant improvements to its sewer system or connect to the City's system. Mr. Morgan reviewed the two proposed annexation boundary map alternatives. He related that the first alternative (Alternative No. 1) comprises approximately 3.3 square miles and has two small sub-areas. He stated that the second alternative (Alternative No. 2) involves approximately one square mile and is centered primarily around Shasta College and has 100 percent property owner support. He highlighted the differences between the City's and County's general plans. He pointed out that the primary difference in the general plans is the commercial property depicted in the County's general plan in the vicinity of Shasta College. Assistant City Manager Perry provided answers to questions raised at the December 5, 1995, City Council meeting, as contained in the paper entitled Stillwater/Shasta College Annexation (issues raised at the December 5, 1995, City Council meeting) , incorporated herein by reference. Mr. Perry stated that the Mello Roos District would provide funds for the following services: (1) Police; (2) Fire; (3) Street maintenance; (4) Parkway and park maintenance; (5) Emergency medical services; and (6) Storm drain maintenance. He noted that the revenue from the Mello Roos District is approximately equal to the County's portion of the property taxes. With regard to providing electric service to the College, Electric Utility Director Lindley related that it normally takes approximately two years to complete PG&E electric facility acquisitions. Council Member Murray indicated that an issue to consider in this decision is the fact that if annexation occurs in the near future and the City begins spending money to acquire electric utility facilities, etc. , the College may then find that one of its primary benefits of annexation, electric service, no longer 02/26/96 44 exists due to deregulation and the imposition of a Competitive Transition Charge (CTC) . At that point, he related it would be too late to cancel the arrangement. He cautioned that consideration needs to be given to both sides of the issue before a final decision is made. Due to the deregulation currently occurring in the electric industry, he cautioned that if the decision is made to proceed with the annexation, PG&E electric utility facility acquisition should be completed as quickly as possible. In response to Council Member R. Anderson, Fire Chief Wagner stated that the location of the College's fire station is ideal for the campus, but would not provide adequate coverage for the remainder of the area. Council Member Murray related that the average residential property in Redding during 1995 was valued at approximately $117,000, representing six-tenths of a percent increase over the prior year. He did not believe it was appropriate to assume that residential property values in the annexed area would be higher. He also stated that he had requested information regarding whether there were existing streets within this annexed area that had potential infrastructure problems which would create legal ramifications for the City, and he suggested obtaining accident records for the area through the Shasta County Sheriff's Department. Mr. Morgan reviewed Fiscal Impact Analysis Alternative No. 1 and Alternative No. 2 dated February 1996, incorporated herein by reference, and the various assumptions utilized. He noted that there are four basic assumptions contained in each analysis: (1) Development; (2) Revenue; (3) Expenditure; and (4) Assumption the City has the right information. Mr. Perry reviewed Fiscal Impact Analysis Alternative No. 3 dated February 1996, incorporated herein by reference. Council Member Murray opined that, by definition, if the City does not annex any additional territory, its sales tax revenue will not be as great as there will be less population growth. He stressed the importance of recognizing the driving forces behind the various assumptions. He stated that sales tax increases by population growth, not the annexation of taxing entities. Council Member Murray stated that he expected to see an analysis with the extension of services without annexation, as well as the assumption that the County would adopt the City's development standards. Mayor Kehoe recommended that the workshop be continued to allow the City Council additional time to study the information. Dr. Douglas Treadway, President of Shasta College, related that when the annexation application was submitted, it was believed that there was going to be a large sewer trunk developed and annexation would be required in order to connect. He stressed that sewer service is critical, as the College has been cited by the Water Quality Control Board. He related that approximately $50,000 in sewer improvements have been made to date, with another estimated $200,000 to $300,000 required if annexation does not occur. He indicated that if there is not a near-term favorable decision regarding the annexation, the College will have to develop a water treatment plant and/or upgrade the existing one. He noted that he did not believe the actual improvements would be required if it was known that the annexation would become a reality. Dr. Treadway pointed out that the longer the annexation is delayed, the more it will cost the College in terms of improvements to its sewer system. He pointed out the following matters relative to staff's assumptions: 1) The College has completed a master site plan for the 350-acre site; 2) The College is projecting a 5 percent enrollment increase each year for the next 20 years, thereby doubling the enrollment and facility size; 3) It is anticipated that commercial development will ensue from the College's growth; 4) The College is interested in commercially developing its property on Old Oregon Trail; 5) It is also anticipated that residential development will occur as a result of staff members desiring to reside close to the campus. He noted that eight new faculty members will be added this Fall; 6) The College has applied for funding for a new fire training center. The College would like to continue to run its fire brigade as part of that responsibility. He indicated that it may be possible to negotiate this station to also serve as a City station; 7) The College has approached the County about deputizing its current security staff; 8) Because of the College's security, police protection is not a primary concern at this point in time; 9) It is likely that part of the City's growth will include a California State University (CSU) campus; 10) A study is underway for a possible engineering program; 11) Talks with CSU have indicated that, due to deregulation occurring in the electric industry, it may be possible to develop a solar generation plant on campus; and 12) Due to the age of the dormitories, the College is considering privatizing this function. He stressed that whatever decision is made, the College will continue to be good citizens and partners with the City. He also acknowledged the importance of an accurate analysis to ensure the best interest of both the City and the College. Council Member R. Anderson noted that the College is the key ingredient of the proposed annexation. He recommended that staff meet with the representatives of the College to ensure that the annexation is feasible for both parties. Ron Munk questioned how the City would deal with providing services to properties located outside the City, i.e. , establish an assessment district, etc. He also asked whether surcharges would be imposed on the monthly sewer fee. 02/26/96 45 Public Works Director Galusha responded that the City would have the option of adding a surcharge to the monthly fee. With regard to constructing the facility, he indicated an assessment district would be formed. Mr. Perry emphasized that in order to provide service to properties outside the City, the City Council would need to change its existing policy. Chris Kraft, Sharrah, Dunlap & Sawyer, questioned whether some of the area identified as Commercial in the General Plan would generate additional sales tax. Mr. Perry explained that the existing General Plan would be modified to reflect the gas mart and other commercial activities occurring in the area which do not exist today. He related that if staff were to factor in a community shopping center, the assumptions would change. Mr. Warren pointed out that the General Plan is currently being updated and existing designations could ultimately change. In response to Mr. Kraft, Administration Services Director Starman pointed out that staff did consult with the City's sales tax auditors, Municipal Resource Consultants, regarding the proposed sales tax assumptions. The consultants noted that much of the sales tax generated within the City is derived from tourists and recommended utilizing a County-wide figure which is more relative to medium- household incomes. John Kenny stated that the demand for annexation is due to the need for City services. He noted that, with or without annexation, expenses are going to increase. He opined that the only new revenue received as a result of this annexation will be the voluntary revenue property owners take upon themselves through the formation of a Mello Roos District. He suggested that the City reconsider its position of not providing City services to properties located outside the City on a case-by-case basis. Mayor Kehoe pointed out that the City had done exactly that with regard to providing water service to the Redding Rancheria. Mr. Warren was not inclined to believe that larger annexations are necessarily better for the City. He cautioned that future City Councils may not have the political fortitude to implement an annual four percent increase with regard to the Mello Roos Districts. He noted that a Mello Roos District can be voted out by the people being taxed. He also expressed concern regarding the growth numbers. He pointed out that one lawsuit or major issue in the area could change the expenditure assumptions dramatically. He also expressed concern with having too many residents at different tax rates, i.e. , Mello Roos District. He related that this can lead to future political problems when people begin realizing that they are paying more in taxes than their neighbor that was not annexed. He also acknowledged the value of having the College within the City limits and working with the College in developing their residential and commercial master plans. If annexation is to proceed, Mr. Warren recommended starting with the College and the surrounding interchange. He stated that this would be conditioned upon the College's willingness to negotiate some type of agreement to offset the anticipated difference between revenues and expenditures. He concurred that staff needs to do additional analysis on the assumptions. In response to Mayor Kehoe, Mr. Perry believed that staff could do the additional analysis and bring the matter back before the City Council in approximately one month. Council Member Murray believed that a smaller annexation which focuses narrowly on the College is the worst thing that could happen to the City financially. He, therefore, recommended that the upcoming analysis include all possible scenarios. No action was taken. RESOLUTION - Lease Agreement with California State Lands Commission re Lake Redding Bridge Project (Diestelhorst Bridge Replacement) (S-070-050-100 & A-070-075) Assistant City Manager Perry related that the City, in order to construct the bridge, needs authority from the State which has title to the lands beneath the river. He stated that the California State Lands Commission provides for leasing the State lands within the boundaries of the Sacramento River upon and over which the Lake Redding Bridge is to be constructed. He noted that there is not a fee attached to the lease at this time, but does provide that the State may impose one at some point in the future. Mr. Perry explained that this lease agreement has to be returned to the commission by February 26, 1996, in order to be included in its meeting of February 27. He stated that complete processing of the permit is required prior to construction. It is the recommendation of staff that the City Council adopt the necessary resolution authorizing the execution of the lease agreement. MOTION: Made by Council Member P. Anderson, seconded by Council Member R. Anderson, that Resolution No. 96-044 be adopted, a resolution of the City Council of the City of Redding approving entering into a General Lease (Public Agency Use) with the State of California, State Lands Division, for the 02/26/96 46 replacement of the Diestelhorst Bridge across the Sacramento River. Ayes: Council Members - P. Anderson, R. Anderson, McGeorge and Kehoe Noes: Council Members - Murray Absent: Council Members - None At the hour of 11:32 a.m. , Mayor Kehoe declared the meeting recessed At the hour of 11:39 a.m. , Mayor Kehoe reconvened the meeting to regular session. CLOSED SESSION - re Litigation (L-100) Mayor Kehoe explained that subsequent to the posting of today's agenda, it has been determined that it is necessary to hold a 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, et. al. , and related cross-action, Shasta County Superior Court Consolidated Case Nos. 87226 and 95735. He stated that because this is an urgency item, it will require a 4/5 vote to place this item on today's agenda. MOTION: Made by Council Member R. Anderson, seconded by Council Member P. Anderson, to place the following matter on today's agenda: Conference with Legal Counsel - Existing Litigation: City of Redding v. Shasta Enterprises, et. al. , 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 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, et. al. , and related cross-action, Shasta County Superior Court Consolidated Case Nos. 87226 and 95735. At the hour of 11:40 am. , Mayor Kehoe adjourned the meeting to closed session. At the hour of 12:10 p.m. , Mayor Kehoe reconvened the meeting to regular session. No action was taken. ADJOURNMENT There being no further business, at the hour of 12:10 p.m. , Mayor Kehoe declared the meeting adjourned. APPROVED: ayor ATTEST: ly door dir City Clerk j 02/26/96