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HomeMy WebLinkAboutMinutes - City Council - 1998-06-29 163 Special Meeting, Redding City Council City Hall Conference Room 760 Parkview Avenue Redding, California June 29, 1998 10:30 a.m. The Special Meeting of the City Council was called to order by Mayor Kehoe with the following Council Members present: Anderson, Cibula, Kight, McGeorge and Kehoe. Also present were City Manager Warren, City Attorney Wingate, Assistant City Manager Perry, Deputy City Manager Star Electric Utility Director Feider, Public Works Director August, Police Chief Blankenship, Development Services Director Swanson, Fire Chief Wagner, Administrative Services Director Bachman, Community Services Director Gorman, Support Services Director Kersten, Economic Development/Asset Manager Hiller, City Treasurer Linville, Police Lieutenant Davidson, Finance Officer Strong, Building Official Nagel, Information Systems Manager Erwin, Budget Officer Davis, Airports Manager Dinger, City Clerk Strohmayer and Assistant City Clerk Moscatello. RESOLUTION AMENDING 1997-1999 B1-ANNUAL BUDGET (B-130-070) Mayor Kehoe thanked City Manager Warren, City Attorney Wingate, department directors and staff for their assistance with the preparation of the Bi-Annual budget. Mayor Kehoe conveyed City Council's special thanks to community liaisons Lisa Reiser and Allyn Clarke who participated in the budget study sessions. City Manager Warren noted that the proposed 1998-99 budget is a presentation of amendments to the 1997-99 Bi-Annual budget adopted by City Council a year ago. He explained that this is a status quo budget and is down from last fiscal year's budget by 13.7% to $157.7 million. The general fund budget is $37.8 million. Mr. Warren conveyed that the projected reserves for the General Fund is maintained at or above 5% over the entire 10-Year Financial Plan, and the current projection is to end the fiscal year with a reserve of at least 8.5%. He conveyed that the revenue projections for the utilities are realistically conservative and the Solid Waste, Water and Wastewater utilities all show the need for rate increases in the near future. Mr. Warren stated that expenditures for the general fund increased $1.3 million over the 1997-98 budget and include funds for one additional firefighter; a gardener for Parks maintenance, a Secretary position to be shared between the City Attorney's office and the City Manager's office and an additional $25,000 for Code Enforcement activities. Mr. Warren stated that an additional $285,000 is being allocated to the Streets Division for contract street and sidewalk maintenance for a total of $1.1 million. However, the backlog of street maintenance projects is still more than $5 million. Mr. Warren summarized the proposed capital projects for the General Fund, the Utilities, Municipal Airport, Redding Area Bus Authority and Redding Redevelopment Agency. City Manager Warren thanked Lisa Reiser and Allyn Clarke for participating in the budget process and staff for their hard work on the budget. He also thanked Council Members Kight and Cibula for sitting in on the budget study sessions. Lisa Reiser, Citizen's Review Committee, thanked staff for an excellent presentation. Ms. Reiser observed that while the budget meets the criteria for the long-range ten-year plan, it is close to the 5% minimum reserve in fiscal year 2001-02. She expressed confidence that the projections are fiscally conservative. She was not confident, however, that the 3% increase for personnel costs was sufficient to cover pay-for-performance and cost-of-living adjustments. Ms. Reiser suggested that staff review and determine if adequate funds are available, and she opined that the City should budget 6/29/98 164 funds for employees who buy back vacation time and are retiring. Ms. Reiser opined that Fleet Maintenance should be contracted to the private sector and she favored focusing labor increases in the Police and Fire Departments for the next two years rather than in other departments. Allyn Clarke, Citizen's Review Committee, was unable to attend the budget hearing and, therefore, submitted a letter dated June 23, 1998, which was read by Administrative Services Director Bachman. Ms. Clarke states that the budget is a fair and realistic representation of the anticipated expenditures for the City. She notes that overall, most departments are in good shape and accomplishing their goals., however, the Fire Department, Streets and Recreation appear to be lagging in attention. Noting that the Fire Department would like to add a new station and increase existing two-man staffing on an engine to three-man staffing, Ms. Clarke stated that alternative funding sources, outside the general fund, must be sought. Noting that the general fund will never fully compensate for the backlog of street maintenance, Ms. Clarke recommended that a collaborative effort with Shasta County be made and State funding sources be aggressively pursued. Ms. Clarke also noted that the Recreation Department experienced a significant increase in salaries due to the minimum wage adjustment, and repairs to the Redding Plunge are extensive and outside the scope of the general fund. She recommended that grants be aggressively pursued and collaboration with local swim clubs be considered. Ms. Clarke recommended that funds be budgeted for built-up vacation and benefits for retiring employees. Administrative Services Director Bachman reviewed the General Fund Ten-Year Financial Plan revenue and expenditure assumptions outlined on pages 14 and 15 of the proposed budget. Vice Mayor Anderson requested that staff insert a page in next year's budget comparing the current year's revenue assumptions to the ten-year financial plan revenue assumptions. Noting that the proposed budget indicates that museum funding will be discontinued after fiscal year 1999, Mayor Kehoe stated that the present City Council has not spoken to this assumption and that may not be a valid representation. Mr. Bachman indicated that a contingency fund for funding the museums through fiscal year 2006-07 is listed on page 18. In response to Council's concerns regarding the assumption that personnel costs will only increase by 3% and the matter of budgeting for Pay-for-Performance increases, Mr. Bachman indicated that it is difficult to predict and budget for personnel costs. He stated that the proposed 3% increase generally covers these costs and the shortfall can be made up when employees leave and salary savings are realized. In response to Ms. Reiser's and Ms. Clarkes' concerns, Mr. Bachman stated that a severance pay line item was added to the budget in the amount of$200,000 per year. Mr. Bachman conveyed that Administrative Services will continue to monitor this matter. Noting that Lisa Reiser may have some suggestions on this issue, Council Member Cibula recommended that staff discuss this further with her. Administrative Services Administrative Services Director Bachman reviewed the Administrative Services budget which includes Finance, Personnel, Employer Services, Volunteer Services and Risk Management. Mr. Bachman indicated that there were no budget issues. Community Services Community Services Director Gorman reviewed the Community Services budget which includes the Recreation Division, Redding Museum, Carter House Museum, Parks, Convention Center and Convention and Visitors Bureau. Mr. Gorman noted that the Convention Center division is over budget by $23,830 due to capital outlay projects to improve the sound system, purchase a computerized ticketing system and make stage enhancements. He explained that these capital outlays are offset by a decrease in PERS expenditures by the Convention and Visitors Bureau in the amount of$23,830. 6/29/98 165 Mr. Gorman conveyed that the City would like to improve the Caldwell Park Plunge (municipal swimming pool) to make it more attractive and bring the facility up to Americans with Disabilities Act(ADA) standards. He stated that staff is working with the private sector to create a partnership to help operate the Plunge so the renovation will be expenditure neutral. Mr. Warren stated that staff will be reporting back to Council on this matter. Development Services Development Services Director Swanson reviewed the Development Services budget which includes Planning, Building, Geographical Information Systems (GIS) and Airports. Mr. Swanson indicated that the Planning, Building and GIS divisions are within budget. The Airports fund is over budget due to budgeting funds for runway paving rehabilitation at the Municipal Airport, remodeling the Hillside building at Benton Airport and hiring a full-time temporary intern to assist with the work backlog. Mr. Swanson conveyed that the department is interested in improving customer service and public relations and has implemented a plan to meet that goal. Council Member Anderson suggested that the Building Division's goal of"improving communication with the building community" be broadened to include"improve customer staisfaction." Mr. Swanson reviewed the five-year financial plan for airport funding. He recalled that staff implemented a plan to wean the Airports from the General Fund and the City is currently on track to eliminate that support in fiscal year 2001-02. Mr. Swanson indicated that staff strives to operate the airport like a business and will be recommending increases in the fee schedule to the City Council in the near future. Electric Utility Electric Utility Director Feider reviewed the Electric Utility budget. Mr. Feider indicated that the proposed budget totals $88,354,070, which is a decrease of$2,288,330 from the bi-annual budget adopted in 1997-98. Noting that one of the Electric Utility's proposed goals is to develop proposals for the City Council's consideration to provide rate parity between customer classes, Mayor Kehoe said it was his understanding that Council had no interest in raising rates until the 23% surcharge was eliminated. Mr. Feider explained that the goal to reach rate equity is general in nature and the intent is to look for ways to implement programs which will do that. He noted that programs such as low interest loans for business customers and credits for time-of-use have been implemented to reach that goal. Mr. Feider stated that it is not his intention to recommend raising electric rates to lower another class's rates. Vice Mayor Anderson requested that a table be inserted into the final budget which illustrates a five- year forecast relative to debt reduction outlining how much debt has been defeased in that year and projecting when the debt will be paid off. Mr. Feider presented a market comparison chart for future electric rates and stated that the Electric Utility will be within range of providing competitive rates to its customers by the year 2002. Mr. Feider also provided an overview of the long-term market. Mr. Feider stated that a new customer billing system is necessary to keep up with the new deregulated market and requests by customers for information and billing options. He explained that the existing customer billing system is old and not suited to the deregulated environment the utility is moving into. Mr. Feider conveyed that the investment in software will impact the budget by $900,000 and the Electric Department is looking for a way to pick up the cost in the next budget year. He stated that staff will be providing more information to Council on this matter. Fire Department Fire Chief Wagner reviewed the Fire Department's budget. Chief Wagner indicated that the department's budget is $235,130 above the adopted budget due to an increase in retirement costs, 6/29/98 166 an increase in severance pay for anticipated retirements, an additional fire fighter position, an increase in funds for the technical rescue program and an increase in anticipated outside legal services. Council Member Kight stated that he is a proponent of establishing three-man engines in the Fire Department. Noting that the budget provides for one additional fire fighter, he asked for Council's feedback on hiring a second fire fighter during this budget year. He said he would like to make a commitment to prioritize this concept within the next several years. In response to Mayor Kehoe's question, City Manager Warren stated that Fire Station #5 currently has a three-man engine. Mr. Warren related that during labor negotiations, he conveyed to the Union that he would be recommending one additional fireman during each of the next three budget years. Council Member Cibula expressed his support for moving ahead with hiring an additional fire fighter to support another three-man engine. Mayor Kehoe questioned where the money for this position will come from. Mr. Warren replied that money would have to be cut from somewhere else, such as road maintenance. Mayor Kehoe stated that if Council wants to add an additional fire fighter, he would recommend a shift in the Fire Department's budget. Chief Wagner noted that the Fire Department's budget is very lean and funds could be transferred from either technical rescue, apparatus or building maintenance. He explained that it would be a difficult decision to make. Council Member McGeorge questioned when new CaIOSHA regulations requiring two men outside before allowing two men inside effecting a rescue will become effective. Chief Wagner explained that legislation may be adopted near the end of October. Mr. Warren clarified that establishing three-man engines does not meet the intent of OSHA's new requirement. It does not mandate three-man engines; it just requires the fire fighters to wait until a second engine arrives. Mr. Warren also pointed out that there is the ongoing issue of building a new Fire Station#8. He noted that Council could add two fire fighters this year, instead of one, and not add an additional fire fighter next year. Vice Mayor Anderson stated that if City Council wants to hire an additional fire fighter, he does not want the money for the position to come from the reserves. Mayor Kehoe stated that it is the consensus of City Council to add an additional fire fighter position to the budget and not compromise the budget reserves in doing so. It is the consensus of Council to preferably make the adjustment in the Fire Department's budget without compromising ongoing operations; and if funds cannot be found there, staff may look at the City-wide budget. Mayor Kehoe stated that Council's motivation in doing this is grounded on sound management of technical resources. Council Member Cibula requested that staff be very cautious about cutting funds from the training program. Mayor Kehoe clarified that Council's action to budget for two fire fighter positions in this fiscal year's budget does not eliminate the proposed plan to budget for another fire fighter position in next fiscal year's budget. In response to Mayor Kehoe's question concerning the status of the river rescue boat, Chief Wagner conveyed that the rescue boat is under the ownership of the City; and the Fire Department is discussing with employees how the river rescue program can be implemented. RECESS At the hour of 12:05 p.m., Mayor Kehoe declared the meeting in recess. 6/29/98 167 At the hour of 12:35 p.m., Mayor Kehoe reconvened the meeting. City Council Deputy City Manager Starman reviewed the City Council's budget. Mr. Starman conveyed that the Council's proposed amended budget has decreased by $1,830 from the adopted budget and there are no budget issues. City Manager Deputy City Manager Starman reviewed the City Manager's budget and noted that the offices of the City Manager and City Attorney propose to share a secretary part-time. City Clerk Deputy City Manager Starman reviewed the City Clerk and Records Management budget and stated that there are no budget issues. City Treasurer Deputy City Manager Starman reviewed the City Treasurer's budget and stated that there are no budget issues. City Attorney City Attorney Wingate reviewed the City Attorney's budget. Mr. Wingate explained that the City Attorney and City Manager propose to share a secretary who will eventually be the receptionist for these departments when the new City Hall is built. Mr. Wingate stated that this fiscal year is the first year of substantial cross charging to other departments. Non-Departmental Administrative Services Director Bachman reviewed the Non-Departmental budget which includes Animal Regulation, General Fund Debt Service and General Fund Capital Projects. Mr. Bachman indicated that the Non-Departmental budget is $1,220 over the adopted budget due to an increase in Community Special Events such as the Renaissance Festival, the bicycle race and expanding the Redding Rodeo and Kool April Nites. Mr. Bachman stated that there is $91,000 budgeted for community events such as the 4th of July, Ducky Derby, Rodeo, Air Show, etc. Council Member McGeorge noted that Kool April Nites is projected to cost approximately $40,000 this year. Mr. Bachman indicated that staff is working with Kool April Nites to keep the cost down in light of the expanded event. Police Chief Blankenship opined that it will be much less than that and staff will keep Council informed. Police Department Chief of Police Blankenship reviewed the Police Department's budget which includes Parking Enforcement and Abandoned Vehicle programs. • Police Chief Blankenship conveyed that the Police Department's budget is within the 3% guidelines required by the 10-year Financial Plan, and it is a status quo budget. Police Chief Blankenship stated that there are still traffic issues in the City that the department will be looking at ways to address. Police Chief Blankenship conveyed that it is the intent of the Department to bring an ordinance before Council which will recover the Department's costs regarding citing and processing drivers with suspended or revoked licenses. He emphasized that it is a cost recovery program, not a fee. Council Member Cibula asked for a breakdown of this program's costs and how the revenue will be generated. Public Works Department Public Works Director August reviewed the Public Works Department budget including Land Development& Transportation, Streets, Parking Operations, Water Utility, Waste Water Utility and Storm Drainage Utility. 6/29/98 168 Mr. August stated that the Streets Division is over budget by $219,015 due primarily to an increase in funding for street maintenance and repair. An additional $285,000 is included in the budget for street maintenance, with$140,000 from ISTEA funding, $45,000 from one-time gas tax funds from the State, and $200,000 from Section 9 funds from the Redding Area Bus Authority. These funds are offset by a reduction in General Fund funding for the Streets program by $100,000. Mr. August stated that the Water Utility is over the adopted budget by $229,085 due to an increase of approximately $300,000 in utility expenses. He explained that the increase is due to not achieving savings from the Electric Incentives Rates program that had been originally anticipated, higher than normal river turbidities and an increase in the surface water turbidity. Mr. August reviewed the Utility's five-year financial plan and stated that a rate increase is needed. Mr. August explained that staff will be recommending a cost of service analysis. Staff will bring this back for Council's consideration in the Fall. Mr. August conveyed that there are over 400 miles of streets that need repair which amounts to a $5 million backlog for street maintenance. Mr. August stated that he will be presenting a thorough package to City Council for its consideration. Council Member Anderson said he is very receptive to the City's street maintenance program getting back on track. He suggested that staff think out of the box and look at new sources of revenue. Mr. August stated that the Wastewater Utility is over the adopted budget by $583,475 due to increases in the Westside Interceptor and Eastside Interceptor projects. Mr. August reviewed the Utility's five-year financial plan and stated that a rate increase should be considered for the fiscal year ending 2000. Solid Waste Assistant City Manager Perry reviewed the Solid Waste Utility's budget. Mr. Perry explained that the main increases in the budget are for capital improvements in the Glass Beneficiating Division and the Transfer Station Division. Mr. Perry noted that the Glass Beneficiating plant is proposed to be operational by June 1, 2000. Mr. Perry stated that the Transfer Station Division is over budget due to the need to repair the push walls and roof at the Transfer Station. Mr. Perry reviewed the Utility's five year financial plan and stated that the Utility will require a rate increase in fiscal year ending 1999. Mr. Perry conveyed that staff will prepare a report for Council's consideration. Support Services Support Services Director Kersten reviewed the budget for the Support Services Department which includes Purchasing, Park Maintenance, Customer Service, Reprographics, Information Systems, Communications, Building and Fleet Maintenance. Mr. Kersten explained that all divisions are within the adopted budget with the exception of the Parks Maintenance and Information Systems divisions. He explained that the Information Systems Division is$64,015 over budget as a result of the request to purchase a new AS400 computer system upgrade for $190,000. In response to Council Member Anderson's question, Mr. Kersten stated that the AS400 upgrade will be state-of-the-art and increase the performance of the mainframe computer system by 182%. He added that it is an advanced design and it will continue to allow the City to leverage the investment it has made to date on the system. Mr. Kersten conveyed that the Communications Division is requesting that a 3/4 time telecommunications technician be upgraded to a full-time position. Mr. Kersten stated that the Fleet Maintenance budget is $426,940 below the adopted budget as a result of excluding fleet maintenance services for the West Central Landfill in the amount of$285,000 and a reduction of$141,940 in operating expenses. Mr. Kersten explained that staff is reviewing 6/29/98 169 Fleet Maintenance operations to improve efficiencies and reduce costs with the goal of providing'cost effective service. Council Member Cibula asked staff to report back to Council during the year on how Fleet Maintenance is meetings its goals. Mr. Kersten conveyed that the utility customer information and billing system needs to be replaced and is listed as an unmet need. Recalling that Electric Utility Director Feider briefly outlined the need for a new system earlier in the budget session, Mr. Kersten indicated that staff will be returning to Council with a proposal. He explained that, in conjunction with the other utilities, the Electric Department is preparing a financing proposal to purchase the system. Mr. Kersten explained that they will need $1.25 million for the system. Public Art Council Member Cibula noted that there is no funding in the budget for art in the Civic Center. He asked staff to report to Council on options for public art in the Civic Center. Vice Mayor Anderson pointed out that the private sector may be able to take the lead in this matter. Economic Development Council Member Kight opined that the City has done a good job of providing incentives for economic development; however, he noted that the City does not own a large piece of industrial property with infrastructure to attract large potential businesses to Redding. He explained that other cities have purchased large 100 acre parcels of industrial property that provide a ready-to-go package. Council Member Kight proposed that the City acquire a large piece of improved industrial property in order to offer an economic incentive package to businesses. Council Member Kight asked for a response from Council. Mayor Kehoe stated that while the suggestion is good, it may be premature. He opined that the City and the Redding Redevelopment Agency (RRA) need to establish a vision, philosophy and grand design first, and then identify a mechanism to complement that design. He explained that he would like to see that plan before making a financial commitment. Council Member McGeorge agreed with Mayor Kehoe that a plan should be developed first. He noted that the City has developed a significant number of economic incentives which are working. Council Member McGeorge complimented staff on the budget presentation. Vice Mayor Anderson stated that the City should move in that direction, but a plan should be developed first. He opined that a 100-acre parcel may be too small and 300 acres may be more suitable. Vice Mayor Anderson noted that the General Plan Update committee could find a suitable parcel that is properly zoned and RRA could acquire the property. Noting that funds have been set aside for public/private partnerships, he said he would like to see the money kept within a revolving fund where one parcel is sold off and another parcel is purchased. Council Member Cibula opined that this concept should be explored further because it could be an effective tool. Council Member Cibula agreed with Mayor Kehoe that the City should prepare a policy if it wants to move forward. Mayor Kehoe asked City Manager Warren to prepare a draft economic development plan and strategy for Council's consideration. City Manager Warren stated that he could bring a report to Council in August. MOTION: Made by Council Member Anderson, seconded by Council Member McGeorge, that Resolution No. 98-92 be adopted, a resolution of the City Council of the City of Redding adopting an amendment to the City's 1997-99 Bi-Annual Budget. Voting was as follows: AYES: Council Members - Anderson, Cibula, Kight, McGeorge and Kehoe NOES: Council Members - None ABSTAIN: Council Members - None ,ABSENT: Council Members - None Resolution No. 98-92 is on file in the office of the City Clerk. 6/29/98 170 ADJOURNMENT There being no further business, Mayor Kehoe declared the meeting adjourned at 1:15 p.m. APPROVED: 111 ayor ATTEST: • gft-7,tee:& gfr City Clerk / 111 6/29/98