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HomeMy WebLinkAboutCC Min 2004-03-08 2-23-04 / 3-8-04 clerk I Approved: ~~~e~ I Mayor Attest: Seal Beach, C~lifornia March 8, 2004! The regular adjourned meeting scheduled for 6:30 p.m. this date was canc~led due to the lack of Closed Session business i te . n need' of consideration. Ci of I Seal Beach, California March 8, 20041 The City Council of the City of Seal Beach met in regular session at 7 :'02 p.m. with Mayor Campbell calling the meeting to order wit~ the Salute to the Flag. ROLL CALL Present: Mayor Campbell Councilmembers Antos, Doane, Larson, Yost Absent: None I Also present:: Mr. Bahorski, City Manager Mr. Barrow, City Attorney Mr. Whittenberg, Director of Development Services Mr. Dancs, Director of Public Works/City Engineer Capt. Schaefer, Police Department Capt. Pounds, Lifeguard Department Ms. Arends-King, Director of Administrative Services Mr. Vukojevic, Deputy City Engineer Ms. Yeo, City Clerk 3-8-04 APPROVAL OF AGENDA Councilman Antos requested Items "K" and "L" be removed from the Consent Calendar for separate consideration. Doane moved, second by Antos, to approve the order of the agenda as revised. AYES: NOES: Antos, Campbell, Doane, Larson, Yost None Motion carried I PRESENTATIONS PROCLAMATION - GIRL SCOUT WEEK ' Mayor Campbell read in full the "Girl Scout Week" Proclamation for the period of March 7th through March 13th, 2004. The four Girl Scouts from Troop 1051 each read a brief statement, 'on behalf of all of the Seal Beach Girl Scouts, Junior Troop 1051 was present to kick off Girl Scouts Recognition week,' 'the Seal Beach Girl Scout Association has two hundred seventy girls and adult members, girls from Kindergarten to twelfth grade develop values to guide their actions and character for success in the real world,' 'Troops participate in all types of activities from learning about other cultures, outdoor skills, and service projects,' 'in this past year local Troops have estimated that over three thousand two hundred service hours were devoted to helping children on Indian Reservations, food and clothing drives, homemade blankets for children, garden restoration, etc.' All were reminded that Girl Scout cookie sales have started and people were urged to support their local Girl Scouts, a thanks extended to City Clerk Joanne Yeo for her years of dedicated service to the people of Seal Beach and offered a box of cookies as a token of thanks for her help and support. The Scouts introduced themselves and Mayor Campbell presented them with the Proclamation. I RESOLUTION NUMBER 5217 - HONORING KIM MASONER Mayor Campbell read in full Resolution Number 5217 entitled "A.RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEAL BEACH HONORING AND RECOGNIZING KIM MASONER FOR HER ACHIEVEMENTS AND CONTRIBUTIONS TO THE CITY OF SEAL BEACH." Doane moved, second by Yost, to adopt Resolution Number 5217 as presented. AYES: NOES: ABSTAIN: Campbell, Doane, Larson, Yost None Antos Motion carried Councilman Larson noted the recent number of vote abstentions, and explained that to him an abstention is an aye vote unless it is due to a conflict of interest situation. Ms. Masoner expressed appreciation to everyone who volunteered their time for the local events, especially the beach cleanups, and Councilman Yost who got them started. Councilman Yost offered that it was refreshing to have a Chamber that put so much effort into water quality, everything they have done in the past few years has focused on water quality, the Sand Castle Contest had large exhibits on water quality and urban runoff, the beach and Riverbed cleanups, it was grand having someone who was so responsible to the community and brought so much to Seal Beach. I ORAL COMMUNICATIONS Mayor Campbell declared Oral Communications open. Shoemaker, Grace Community Church, announced that Pastor on 3-8-04 I Wednesday thi~ week the Church will be holding a blood drive from 2: 00 unt1il 8: 00 p.m., their goal is sixty units of blood, about :f ifty percent more than their usual goal, the residents arel welcome and may call the Church to make an appointment. I Mr. Dave Denton, resident and eight year owner of Main Stree't Cycling, said he worked hard to buy his business and ~ove to Seal Beach to enjoy its atmosphere. Mr. Denton said ~e heard rumor that there may be the possibility of reconsideting the parking meter installation on Main Street, and ~sked that if there is any possible way to not install mete~s that it be done, in his opinion it will kill a lot of businesses on Main Street, he understands that the City continu~s to look for revenue streams, sales tax, etc., there is no get rich quick scheme, he would doubt that the kind of revenue will be generated from meters as is being quoted by th~ meter manufacturers. Mr. Denton said his understanding is that Coastal Commission approved meters however made fa suggestion that the issue be placed on a ballot so that the voters could approve or disapprove parking meters, that Idid not happen, the Council took action, yet he understands that there is now a possibility to reconsider meters, he wduld gladly pay $20 per month for the City to not put meters in front of his business. Mr. Jim Caviola, Ocean Avenue, note~ the comment of Councilman Larson with regard to the number of.. abstention votes, said that is likely because there is som~ bad blood on the Council and the people are the victims. Mr.1 Caviola said he wanted to speak about meters, no one wants ,meters but they were voted in on a three/two vote, that mdy be alright legally but as far as being good neighbors and living together in a community it is insulting and tiring, ihe person newly elected in College Park East has come out aga~nst meters but apparently they will be installed thirteen day~ before the new person is seated, asked that this matter be postponed until then, the three/two vote situation is Inot fair representation. Mr. Caviola stated that revenue Ifrom meters is not based on quarters, it is based on tickets, meters cause anxiety, this town is different, there are other ways to raise revenues, his understanding is that the candidate elect from District Four used to be a Ivice president of TRW, managed budgets bigger than that of the City, and had three hundred employees under him, to that he asked the Council to just wait, the Council needs to start working on behalf of the residents, that is the duty of ~he Council. He mentioned a news article in an Orange count~ paper this date about the benefit of trees in the communit~, that is the kind of thing he would like to deal with, the residents do not want meters, said they submitted four hundred fifty signatures to the Coastal Commission, ihe response of the Commission was that the City obviously has a political problem, he asked that the meters be postponed land the Council work together so the residents have representation. Mr. Dennis Smith said he and his wife own a two bedroom, one bath condominium unit on Ocean. Mr. Smith noted ~hat the Council will be voting on an ordinance at this meet~ng that will prohibit any exterior livable space from being added to a legal nonconforming multi-family unit, his understartding is that this limitation evolved about a year ago from an application for a second story addition to a four unit complex on Electric Avenue that was noncompliant with regard to parking and setbacks which raised public concern, he is also aware that during the past year there have been stJdy sessions and hearings which resulted in certain revi~ions of the ordinance. with regard to the . effect of this ordinance on his family, Mr. Smith said even though they have owned their condo, the upstairs unit, for I I 3-8-04 fifteen years, they only spend summers and weekends in Seal Beach, they would like to live here full time, would like to retire here, they love the City. Mr. Smith said the plan was to add a bathroom, being an architect he understands that before you make any changes one needs to check with the Planning Department to make certain that all of the regulations are known, in December he submitted plans to the Building Department, showed that it is a ninety-four foot bathroom and closet addition to the second floor of a duplex on a twenty-five by one hundred ten foot lot, it complied with lot coverage, parking, setbacks, heights, it has four covered parking spaces, two guest spaces, a twenty foot setback from the alley, there were no objections raised by staff nor was there mention of moratorium or the nonconforming use issue, he was given a copy of the Residential High Density guidelines with a suggestion to complete the plans, submit them and apply for a plan check. After working on the plans for sixty hours and hiring an engineer to do calculations and structural design, last week he submitted the plans to the City, was told to prepare three sets of plans for submittal to the Coastal Commission for review, and being a minor addition it would likely be approved in a week; later that day he called back to the City with a question on lot coverage calculations, he spoke to the Director of Development Services, explained his project and at that point he became aware that his lot was nonconforming due to density, it took several days to confirm with the City Attorney that his property did fall under the nonconforming ordinance and that he could not submit for plan check. Mr. Smith mentioned that the Director provided him with the history of the ordinance, which he read over the weekend, at which time he became aware of the magnitude of his problem, he can not find space for a second bathroom in his small unit, what can he do, question, is the ninety-five foot bathroom and closet on the second floor, extending out five feet beyond the garage doors, leaving a thirteen foot setback on the alley, detrimental to or out of character with the neighborhood, if this ordinance is approved the only option he would have would be to make application for a variance which he has been told is very difficult to obtain due to the heightened level of findings that the Planning Commission must make to approve. Mr. Smith asked that approval of the ordinance be deferred until some means is inserted whereby through a conditional use permit process or something similar for minor exterior additions to nonconforming due to density only of residential properties could be proposed, there are allowances within the ordinance for single family dwellings, why not a duplex, he would hope this could be resolved. Ms. Joyce parque, Seal Beach, asked that the City Manager put all contracts on hold, those having any value that the taxpayers will have to pay, one would be the contract to buy parking meters, wait until the new member of the Council is seated and looks at the contracts, this will harm no one, the Mayor has admitted that some contracts are flawed, the Trailer Park an example, Councilmember Larson asked for an explanation of what happened, it took six months to go through the documents and the response was a couple of pages and hard to understand, it was said the Zoeter School agreement was even worse and more complicated, just recently the Consolidated refuse contract was questioned and after re-reading the document consideration may be given to getting another bid, again, the contracts, which put the taxpayers in debt, should be held until there is a new member of the Council to review them, that person has his own business and knows about contracts. To her the trash contract is puzzling, there are I I I ,j,..-,' ...-. 3-8-04 I I two councilmembers who voted not to have an open bid, Leisure World has a different contractor as does Surfside, how can I those members vote to double the contract and change the pickups fromjtwice to once a week, they not only have a different contractor but received $40,000 from their recycle bins, it is rtot right for people who do not live in the neighborhood Ito deny the people two bids. If the City Manager takes the responsibility for sending the police cars to Sunset Becich to be washed he can also make certain there are no new cdntracts until the new member is seated. Ms. Sue Corbin, Seal IBeaCh, spoke regarding the City Clerk election, claimed that the services of the Mayor as Clerk are not needed, the Council did not endorse her, and the $80,000 for a run-off el~ction should not be spent. Ms. Corbin said it , should have been the Mayor that brought up the trash contract rather than herself, it was thought to be a seven year contract but lit is found it is fourteen years, it rolls over, claimed that every other city gets bids for their trash contractor, this contract needs to be bid. Ms. Corbin scolded the Mayor for not introducing the former City Clerk candidate KiIDberly Boyd. who was in attendance with the Girl Scouts, claimed that parking meters and certain contracts are being forced Ion the people, the new member of the Council should have his say, and criticized the statement made about abstaining f~om voting. There being no further comments, Mayor Campbe]l declared Oral Communications closed. I I CITY ATTORNEY REPORT No report was: pre~ented. I I CITY MANAGER iREPORT No report was presented. . I COUNCIL COMMENTS With regard to the recent election, Councilman Doane reported that the new Islate voting machines worked very well, there had been some concern about Leisure Worlders using them, there were n~ complaints, there were complaints however that they combineq the precincts, particularly in Clubhouse Two where people iusing canes, walkers, wheel chairs were in line well over a half hour before they could be signed in, there were plenty df machines, the wait was to get processed, there was one crew Forking three precincts rather than one, this was the fault of the Orange County Registrar of Voters, something wi]l need to be done about this. Councilman Doane requested thdt on an upcoming agenda an item be placed for consideratioti relating to cottage industry work permits, he had worked wfth the former City Manager and people in Leisure World to establish the cottage industry exceptions to the business lice'nse system, it was an excellent decision by the Leisure World News to only accept ads for publication from people who hdd a current business license, this was to resolve the i!ssue of people putting ads in the News then taking advant1age of some of the Leisure World residents, it was a good pl'an and eliminated fraud. Councilman Doane , mentioned ho~ever that in Leisure World there were people who worked out of; their homes, were allowed to keep an inventory, the restrictipns were that the people had to be over a certain age, they could not make more than $5,000 per year, yet he has now had a resident call saying she has been turned down for those very reasons, that is why he would like this issue agendiz~d in the near future. He reminded also that the cottage ihdustries are not exclusive to Leisure World, it is available FO anyone who has reached a certain age level that have a hpbby type enterprise who want to advertise and I 3-8-04 sell their merchandise. To the suggestion that the request of Councilman Doane be done by motion of the Council, Councilman Yost questioned the need for a motion, said is it not true that a member of the Council can place an item on the agenda, the Manager responded that he merely wanted concurrence of the Council to move in that direction. As a point of clarification the City Attorney said if there was no objection by the Council the item will be on the next agenda. Councilman Larson requested to remove Item "G" from the Consent Calendar. As to the request of Councilman Larson, the City Attorney recommended that there be a motion to reconsider the Approval of the Agenda. Antos moved, second by Yost, to reconsider the Approval of the Agenda. I AYES: NOES: Antos, Campbell, Doane, Larson, Yost None Motion carried Larson moved, second by Yost, to remove Item "G" from the Consent Calendar for separate consideration. AYES: NOES: Antos, Campbell, Doane, Larson, Yost None Motion carried Councilman Yost said he was pleased to see that the MPROP petition received the required number of signatures from the Trailer Park residents, that will mean that the $1 million, fronted by the Agency through the Bridge Loan for purchase of the Trailer Park, will be returned to the City, it appears that both sides got together and cooperated with the gathering of the signatures, it is hopeful that in this new spirit of cooperation they can put aside some of their differences and resolve some of the issues in the Park. With regard to parking meters, Counci J.man Yost said most of his district is against them, knows few that are for meters, he went to several businesses on Main Street and everyone was against meters, he has received one e-mail that was for meters, some of the comments from the businesses were that when an additional fee is added it is like an additional tax on whatever product is being sold, that is like adding fifty cents to anything being sold in the store, likely to decrease any business that will be done, and noted that meters were approved on a three/two vote, those opposed were from the area that includes the area that is to be metered. He mentioned that there is a new candidate elect and in his newspaper interviews and public statements it appears he is someone who is not in favor of division, rather listen, come together, and resolve issues, he would like the parking meter issue held and placed on the next agenda to reconsider the vote to approve, he would like to have the candidate elect look at the issue and see if the.e is a way to resolve this in another way, this is a divisive issue, he would like to get over the division. Councilman Antos said he too would like to see the meter issue on the next agenda for reconsideration of the vote. In response to comments made under Oral Communications, Mayor Campbell mentioned that a comment was made that she had said certain contracts were flawed, she did not, with regard to whether the Zoeter contract was bad, at the request of the Mayor the Manager said he felt there is some misconception about what is in the Zoeter agreement and how/why the first right of refusal was put in the agreement, the Mayor also asked if the Manager had said that the refuse hauler contract had to be redone, the Manager said his concern was with the cable contract, the trash contract terms were negotiated, he has met with the trash contractor and in researching the file he found a copy I I .';~ .".~,' .-"\-"'~' c':_ "..' 3-8-04 I of a visual presentation that clearly outlined what the City would and would not get. Members of the Council objected to being quizzed as to whether they were party to approval of the trash contract. With regard to a question as the estimated cost of the run-off election, the City Clerk responded approximately $1 to $1.50 per voter, there are 18,000 plus registered voters. with regard to endorsements, Mayor Campbell stated that Councilmembers, Doane, Larson and Yost signed her nomination papers, said she did not run a smear campaign however she was smeared. In a newspaper ad it was said she broke her promise to lower the utility tax, she never did that, that tax was in place before she was on Council, at various budget sessions the possibility of lowering it was looked at however that was something that could not be done without decreasing services, the UUT carne in after 1992 with ERAF when the State took more of the City's property tax. with regard to statements made relating to the City Manager severance package she noted that if he were to leave to take another position he would get nothing, if fired with cause he gets nothing, if fired without cause he would not get a lump sum payment but a monthly pay check until he secures another job or for eighteen months, whichever is first, additionally, the City Manager was not fired from Dana Point as is rumored, there are currently four Manager positions open in Orange County, all paying more than Seal Beach, and with his credentials he could go anywhere, anytime, on his terms. As to the former Governor Davis pension plan, that was something that almost every Orange County city voted on, it was done at a time when the stock market was high,~and it is a recruiting tool, cities need to offer competitive incentives. with regard to the $3.5 million in the pension funds, Mayor Campbell explained that when the City joined Orange County Fire the pension funds of the Seal Beach firemen were transferred to the Orange County Fire Department, the now Fire Authority, like all agencies and private companies, the pension funds were invested in the stock market, when the market went down their pension funds decreased in value, a law passed by Congress in 1970 mandates that pension plans be funded to a certain level, the cost to Seal Beach to restore the pension plan for its former employees is $3.5 million, that will be paid over a period of ten years in increments of $350,000 each, her question is what does that have to do with her personally. As to parking meters, Mayor Campbell again stated she does not like them, she views them however as a means to get revenue to repair the streets, of interest is that in February, 2001 upon the departure of the Interim City Manager, he noted that the City has a ten year capital program that required a General Fund commitment of about $2.3 million per year, that the shortfall of capital funds posed a major challenge to the ability of the City to upgrade and maintain the City's aging infrastructure and predicted that without some major infusion of resources to improve the public space, which is streets, curbs, gutters, sidewalks, and street trees, that property values would decline, his recommendation was parking meters as the only way to accomplish raising revenue to resolve the shortfall in the capital improvement plan. There was also a parking Committee that supported parking meters, their concern was with the best way to disperse the money from parking meters. Of interest also are the just released numbers from the Department of Housing and Urban Development, low income for a family of two is from $46,000 to $72,600, that is where the position of City Clerk falls, therefore how does one get a lucrative retirement from a low income job. Other statements made have been that the Manager got a five I I 3-8-04 percent increase, actually he received nothing last year so divide the five percent for a two and a half percent increase over two years, City staff received one percent, the answer is no, no one in this City was laid off or fired, employees are down about twenty-five, the result of natural attrition. CONSENT CALENDAR - ITEMS "c" thru "L" Antos moved, second by Yost, to approve the recommended action for items on the Consent Calendar as presented, except for Items "G, K, and L", removed for separate consideration. I C. Approved the waiver of reading in full of all ordinances and resolutions and that consent to the waiver of reading shall be deemed to be given by all Councilmembers after the reading of the title unless specific request is made at that time for the reading of such ordinance or resolution. D. Approved the minutes of the regular meeting of February 23rd, 2004. E. Approved regular demands numbered 45370 through 45534 in the arnount of $433,002.11, ADP payroll demands numbered 8561403 through 8561477 in the amount of $186,395.22, and authorized warrants to be drawn on the Treasury for same. F. Bids were received until February 24th, 2004 at 10:00 a.m. for Project Number 50172, the Annual Paving Rehabilitation, fiscal year 2003/04 at which time the City Clerk publicly opened said bids as follows: I Ruiz Engineering Company All American Asphalt Griffith Company palp, Inc. dba Excel Paving Co. Terra Pave, Inc. R J Noble Company Silva Construction, Inc. $129,995.60 $139,139.00 $139,799.00 $142,997.50 $147,294.50 $147,680.00 $152,553.50 Awarded the bid for the Annual Paving Rehabilitation, FY 2003/04, Project Number 50172, to Ruiz Engineering Company in the amount of $129,995.00, and authorized the City Manager to execute the agreement on behalf of the City. H. Adopted Ordinance Number 1520 entitled "AN ORDINANCE OF THE CITY OF SEAL BEACH AMENDING CHAPTER 28 (ZONING ORDINANCE) OF THE SEAL BEACH CITY CODE PLACING A RESIDENTIAL CONSERVATION OVERLAY ZONE DESIGNATION ON THE PROPERTY LOCATED AT 308 - 310 7th STREET IN THE CITY OF SEAL BEACH (ZONE CHANGE 04-1)." By unanimous consent full reading of Ordinance Number 1520 was waived. I I. Approved and authorized the position of Marine Yearly Lifeguard. J. Authorized the City Manager to sign a one year contract with Nextel wireless to provide ::'0' .~&.;","_\. ' '" """~,;,-. 3-8-04 cellular service for the Police Department. AYES: NOES: Antos, Campbell, Doane, Larson, Yost None Motion carried ITEMS REMOVED FROM THE CONSENT CALENDAR I I ITEM "G" - ORDINANCE NUMBER 1519 - NONCONFORMING RESIDENTIAL STRUCTURES - EXPANSION - ZONE TEXT AMENDMENT 04-1 Councilman Larson noted that he had given a courtesy vote to the Urgency Ordinance although he opposes urgency ordinances as a matter of course however sometimes necessary. He expressed his feeling that Ordinance 1519 will create more problems than it solves, that it will create ill will with the residents of the community, it is not thought out well enough, as he said before to suggest that an applicant can request a variance is not a good idea because' one can not obtain a variance if the law is followed, it was his intent therefore to vote against adoption of the Ordinance. Councilman Yost requested a brief explanation to the member of the audience who spoke to the nonconforming issue. The Development Services Director said he had spoken to Mr. Smith about the middle of the past week, the understanding is that there is a two unit condominium on the property, it is over density, does not qualify under the Ordinance that is before the Council for adoption which only allows an addition to a nonconforming property if it is a single family residence, in the case of Mr. Smith there are two units on the lot therefore does not qualify under that exemption. When this Text Amendment was considered by the Planning Commission they were provided four different alternatives for consideration, one would have included multi-family properties, the Commission ultimately determined to recommend to the Council single family properties, as it stands an application could not be submitted for the Smith property under the process set forth in the Ordinance, the only way to come to the City would be for :a variance, and as he indicated to Mr. Smith that is a difficult threshold to reach and staff does not believe that it can be reached. Councilman Antos said his recollection is that the issue of condominiums has come up in the past, and if the Ordinance proposed is adopted, asked if the issue of condominiums could be submitted to the Planning Commission for consideration as there are a number of condominium complexes in the City, some of which are over density, for those who have condominium units with CC&R's as an example, suggesting that the Commission should at least look at that issue and determine if condominiums should be treated in a different manner, some criteria in conjunction with the CC&R's. The Director noted that the Council could provide that direction to the Commission if felt appropriate, from the staff standpoint it was felt that the issue of nonconforming, if it was merely for a height or setback issue, really should apply irregardless of the number of units on the property, if a property has three units and meets the parking and other requirements the staff recommendation to the Commission was to include those properties, the Commission determined not to do that, however they could be directed to revisit the issue, and whether the condominium units can be separated out legally from non- condominium multi-family developments that meet all other criteria is an issue that would need to be looked at by the office of the City Attorney. I Councilman Antos recommended that the issue of condominiums be referred to staff, City Attorney, and Planning Commission 3-8-04 for consideration. The City Attorney said if there is no objection that matter will be returned to the Commission and a'report will be prepared as to whether it is possible to distinguish between condominiums and other types of residential structures, it may be allowed for duplexes or possibly not. Councilman Doane asked if there would be a separate ordinance for single family dwellings as opposed to multiple. The Director explained that multi-family units have been removed as to being able to request any expansion, the only properties in the proposed Ordinance that could request an expansion are those that are nonconforming for a setback or height standard is a single unit on a lot, if there is more than one unit on a lot, no matter what the nonconformity, a request for an addition could not be granted, that was the determination of the Planning Commission and is set forth in the Ordinance submitted for adoption. The City Attorney clarified that the current Ordinance provides for minor structural additions to both multi and single family units, however based on the recommendation of the Planning Commission only single family properties can apply for those enlargements, again, the issue of multi units will be returned to the Commission, and the nonconforming Ordinance is before the Council for second reading and adoption. I Antos moved, second by Doane, to adopt Ord~nance Number 1519 entitled "AN ORDINANCE OF THE CITY OF SEAL BEACH AMENDING ARTICLE 24, SECTION 28-2407 OF TITLE 28 OF THE CODE OF THE CITY OF SEAL BEACH REGARDING STRUCTURAL ALTERATIONS AND ENLARGEMENTS TO NONCONFORMING RESIDENTIAL BUILDINGS AND USES (ZONE TEXT AMENDMENT 04-1", and as a separate action that the issue of condominiums be resubmitted to the Planning Commission for consideration. I AYES: NOES: Antos, Carnpbell, Doane, Yost Larson Motion carried ITEM "K" - COUNCIL POLICY - PARKING DETERMINATION - BUSINESS SUITES - MAIN STREET SPECIFIC PLAN AREA Councilman Antos requested a brief report from staff. The Development Services Director stated that the policy statement that the Council is being requested to consider relates to how staff will impose parking standards for business suites that do not face directly on Main Street within the Main Street Specific Plan Area, that includes properties on Ocean Avenue and Central Avenue between the alleys on either side of Main Street, and Electric Avenue a number of small commercial developments that have interior courtyards and walkways off of Main Street that have business suites that do not front Main Street. He explained that the current Code parking provisions for retail use is one space per five hundred square feet and for office use it is either one space per two hundred or one space per two hundred fifty square feet depending on the type of office space proposed. As staff has looked at trying to lease out areas that do not front directly on Main Street that are nonconforming, it is suggested that if a nonconforming retail space can no longer be rented out for that purpose yet could be rented for an office use, that the in-lieu parking provisions not be applied to those properties because they would not meet the parking requirement for a retail use by changing to an office use, in most cases the parking doubles and at $3,500 per space a person could be paying a minimum of $7,000 upwards of $15,000 to $20,000 to try to rent a side-facing space along Central or Ocean or one of the interior walkways, the staff I ,,- -....'....-, .........'.A,... 3-8-04 I report providing photos of a number of locations that are in that category. The Director noted that the Policy Statement does contain exemptions for restaurant, theater, nail and beauty salons, coffee house and desert shop uses that are over a thousand square feet in size, they would continue to be required to meet the current parking requirements in the Main Street Specific Plan Zone, along with the Policy Statement there is an instruction for staff to proceed with a Zone Text Amendment to formalize that language into the zoning standards for the Main Street Specific Plan. Antos moved, second by Yost, to approve City Council policy 600-10, Determination of Parking - Business Suites Not Facing Main Street within the Main Street Specific Plan Area. AYES: NOES: Antos, Campbell, Doane, Larson, Yost None Motion carried I ITEM "L" - IN-LIEU PARKING PROGRAM - 148-E MAIN STREET _ INTENT TO APPROVE Councilman Antos requested a brief staff report. The Director of Development Services reported that this is basically a notice item and something that has been done previously for property developments in the Main Street area that are proposing to utilize the in-lieu parking program that is specified in the Main Street Specific Plan, in this case one of the suites in the previous Johns Food King building that faces onto Central Avenue is proposed to be utilized as a beauty supply store and as part of the requirements of their supplier of products they are required to have a minimum of two beauty operator work stations in the business location, they do not and can not meet the parking requirements unless they participate in the in-lieu parking program for one parking space, the intent is to approve, and the notice before the Council starts a ten day appeal period of that determination, if that were the case the matter would then come back to the Council for formal determination. He noted that the last time a similar issue was considered was March of 2003, that was for four spaces to allow expansion of an existing beauty salon to an adjoining suite that was going from retail use to the beauty salon. Councilman Antos asked if anything is ever going to be done with the in-lieu parking money. The Director said that would be at the discretion of the Council when there are sufficient funds for an action to be taken, such decision would be appropriate during budget considerations. There being no objection, this item was received and filed by order of the Chair. I APPEAL - SEAL BEACH INN and GARDENS - TRANSITENT OCCUPANCY TAX - PENALTY Mayor Campbell stated this item is an appeal hearing of the Seal Beach Inn and Gardens to a ten percent penalty assessed for late payment of the third quarter 2003 Transient Occupancy Tax, the request of staff is to uphold the ten percent late payment penalty, although not a public hearing the appellant or representative thereof will be allowed to speak for a period of ten minutes, members of the public will be allowed three minutes. The Administrative Services Director presented the staff report, explained that Mr. and Mrs. Schmaehl are the owners of the Seal Beach Inn and Gardens and are appealing the ten percent late payment penalty of the Transient Occupancy Tax for the third quarter of 2003, the ten percent late penalty was assessed because the Seal Beach Inn and Gardens did not submit the third quarter 2003 TOT in a timely manner, according to Code 3-8-04 Section 22-29 the TOT is due thirty days after the end of the quarter, the tax due was through September 3, 2003 and payment due October 31st, 2003. She noted that in January while doing a review of revenues of the General Fund it was discovered that the TOT had not been paid in a timely manner, at that point she contacted the hotel and demanded payment plus penalty and interest, the ten percent penalty is a late penalty however it should be noted that in accordance'with the Code the City could have charged an additional ten percent and twenty-five percent penalty which could have been a total of a forty-five percent, instead her decision was to charge only the ten percent penalty, in the past the City has worked with the Seal Beach Inn and Gardens, after the 9/11 incident they experienced financial difficulties because of the travel industry, at that time and before the TOT was due the Schmaehl's did contact the City and a payment schedule was worked out, however this time the City was never contacted in a timely manner therefore she proceeded according to the Code with the late payment ten percent penalty, not the additional ten and twenty-five percent penalties. I Ms. Marjorie Bettenhausen Schmaehl introduced her husband, said they were appealing that the $2,000 fine not be applied for justice and moral reasons and for due consideration of their history. She stated that the Inn and Gardens has paid the TOT on time for twenty-seven years with the exception of the period after the 9/11 occurrence, and they have put into the City coffers, at no expenses to the City, their capital and sweat equity labor of $1.5 to $2 million over the twenty- seven years that she has owned the Inn. Ms. Schmaehl said they wrote to the City that life is a process, a happening, and sometimes the extreme does happen, it did happen to them, they had an employee that was dishonest which cost them a loss of over $20,000 in a quarter, plus a one hundred percent increase of the workers comp rate, there were safety hazard repairs that needed to be made, things that happen to everyone, this was not wrong doing, not evil, they are not criminals, have done nothing wrong, they paid as rapidly as they could with interest. She said they naturally have backing because they are responsible for public funds that are being collected, they put up their capital, they have hard assets to back it, when a crisis occurs it takes time to get hard assets into liquidity, and based on their twenty- seven year history of willfully and wonderfully trying to help the City, they love Seal Beach and they want it to prosper. Ms. Schmaehl read goals that she developed in 1976, at that time Seal Beach did not have a good hotel so they decided to create one, it has benefited the community, she wrote the goals to fulfill a genuine community need, to aesthetically and culturally enhance the City, to bring fame to the community, to contribute to the City revenue, to attract a high quality clientele, and increase business for their fellow business persons, all of those things have been done, all from their own pocket. She added that they marketed Seal Beach as well as the Inn, they have been featured in major magazines, received many awards, one publication cited the Inn as one of the top twelve in the United States, all of this has accrued greatly to the City. She said if there is good will in one's heart there has to be some leniency, all of their taxes are paid to date, after 9/11 they did not have the money so they suggested a payment schedule which has been paid, she found the City to be professional yet a haughty attitude which she contributed to the employees not having a proper perspective of the I I ~,-.._... J', 3-8-04 I necessity of a good, thriving business community in Seal Beach, there has been somewhat of an arrogant, dunning attitude. Ms. Schmaehl said after the situation with the dishonest employee they had planned to pay all that was due by the fourth quarter, explain and pay the interest, but they did not call because there was nothing to give and the attitude was not very good, they were then shocked when told that the City needed $2,000 additional dollars as a penalty, they feel that the City should also look at what is happening in Seal Beach towards the business community. Ms. Schmael claimed that their business was actually harmed through this process in that the City had already called for an audit, which they were not told, then personal affairs were faxed to their business, it was damaging, they have had legal counsel, a business is like a person, something can happen that can cause a short time delay, a time delay is not a crime, but they have literally taken a civil issue and attached a criminal charge for not paying, from what they have heard this may not even be legal and may be actionable against the City, this is not just, she believes in government, cooperating with government. She said while creating the Seal Beach Inn she did not get money back into her pocket for over twenty years but the City got $1.5 to $2 million, that is because it is a high labor and costly type of business, she always believed it would work out, it was about three to four years ago that they began to get revenue for themselves, until then she was able to live on her husbands income, that made the Inn possible, but it was a deliberate and carefully thought out sacrifice on her part to benefit the City of Seal Beach. She mentioned that the Inn gets famous people as guests, it is an artistic piece, it was done to depict the history of the town, but this situation is not business friendly at all, the community will crash if this keeps up, there are ebbs and flows with busine~ses, if this is a hard line thing it is not good, they are grateful for the ability to appeal, in this country justice and mercy are balanced, if they had not had a financial problem then they would have been able to pay on time, she believed the whole balance was paid ten days after the fourth quarter, it is felt wrong to be tyrannical against a business that is having some difficulty, nothing taken into consideration even though they wrote to the City in detail as to what had happened and their willingness to pay. Mr. Schmaehl said in summary, as owners of the Inn it was felt that the correspondence that was faxed to their business for all of the employees to see, the messages that were left on answering machines at the Inn, even after they had given their personal telephone number and specifically asked that only they be contacted, they were shamed, embarrassed, humiliated in front of their employees, it is felt it has affected the morale and confidence in them to an extent that is believed to be unconscionable, their bottom line with regard to this is that they ask for lenience from the Council to waive this fine that is being imposed on them. Ms. Schmaehl claimed that as of today they had $7,000 of business that was canceled with them, that necessitated a $2,500 refund on a deposit that was made on a wedding that was attempted to be scheduled at a private residence on the beach because the bridal couple felt so disheartened with the fees and permits that were being levied on them by the City aside from the normal insurance that they decided to get married in San Diego, this is mentioned only because it appears that there is somewhat of an business unfriendly attitude in the City by perhaps City staff, and they would encourage that that change, it does no one any good when people are turned away or confronted by any means, to have a I I 3-8-04 good business atmosphere benefits them and all other businesses in the City. Ms. Schmaehl added her thoughts that in society there are about seven major groupings in government, churches, religious groups, educational groups, civic groups, but there is only one group that creates the wealth and supports the whole, that is the business community, most who do business just have a driving passion to do it, business people do not necessarily have unlimited amounts of money as people believe, she would urge that Seal Beach study and be business friendly because that is the life blood, as an example, the wedding that relocated would have been a $7,000 wedding and they would have spent an unknown amount at restaurants, in shops, they just feel there needs to be a change of attitude, they want the City to prosper, the economic impact on the community needs to be watched. Ms. Schmaehl threatened to leave Seal Beach if the penalty amount is not waived, 'said she has spent twenty-seven years of her life to bless and prosper this town, she has prayed and sacrificed for the town, if this is the harsh attitude to impose a $2,000 fine because someone was late with a payment for a just cause then she does not want to be in Seal Beach, she does not know who would come into the Inn or what kind of neighbor they would be for the City. Ms. Sue Corbin, Seal Beach, said she wished to speak in support of the appeal, claimed that she read the letter to Ms. Schmaehl, the City was requested to send ~etters and faxes to Idaho, and praised the owners for turning the Inn into something of beauty. She said this should never have gone this far, to ask for their tax records is illegal, the City tried to intimidate the Schmaehls but they will not allow that. Ms. Joyce parque, Seal Beach, made reference to a recent newspaper article that ranked Seal Beach in the top ten list of unfriendly cities to business, now the City wants $2,000 in penalty from the owners just because they had problems in their business, yet they have owned the Inn for twenty-seven years, the City also took business from the Seal Beach car wash and sent the business to Sunset Beach for $1 difference, no thought,given to the seven mile round trip. She said she was present during the budget discussions of reducing the utility tax, some did make promises to try to reduce it but no one voted to do so, there are two million visitors that mostly frequent the beach, they do not go to College Park East, what does the City receive in return, a hostile city to businesses. There being no further comments, Mayor Campbell declared the appeal hearing closed. I I Councilman Antos sought clarification that there was interest on the principal amount, and asked if the principal and interest has been paid. The Director of Administrative Services confirmed that there was interest on the principal, and that the principal and interest was paid on February 17th, the due date was October 31st, confirmed also that there was interest paid on the entire late payment. Antos moved, second by Yost, to waive the $2,000 penalty. I Councilman Yost said he would agree that the Inn is an asset to the community, however he is elected to represent the interests of the community, the Transient Occupancy Tax paid by a visitor to the Inn is actually money that belongs to the residents of the community, not to the owners and must be paid to the City, his sworn job is to represent that and see that it happens, but that is what did not happen, his intent is to waive the penalty yet on the other hand he must uphold the interests that he has sworn to serve the community in .,"".........,.,.,'" -. ~~>?".., .,,....,. ,...,.,...~,., 3-8-04 I terms of protecting that income, it can not be used by the owners for anything else, not for expenses, insurances, retirements, etc., it is a percentage of the money that a person pays to stay in a hotel, that belongs to the community and taxpayers, must go into a separate account and come to the City, that needs to be understood. Councilman Larson noted that the Councilman emphasized the important thing, that the money that the owners paid into the treasury was not their money it was a tax levied on visitors to the City who were staying at their hotel. Councilman Larson said that if this penalty is waived he would like to make certain that the City Ordinance is tightened so that the money collected daily for the Transient Occupancy Tax is placed in a separate bank account so that it can not be used for any personal business of the hotel operator, as an example he felt quite certain that the federal government would not accept an excuse that someone spent the social security money that was collected from an employee, that needs to be in a separate account as should the TOT. He said it is unfortunate that there was an embarrassment by reason of the messages that went back and forth, his feeling is that there should be an ordinance that would require every business owner in ,the City to provide a local phone number where they can be contacted. Councilman Larson noted that one does not make points with him by saying they are going to sell a successful business, similar to those people in Rossmoor saying they were going to sell their homes because they could not shop at a Target store. If waived, this is a penalty that was established by Ordinance, $2,000 may not sound like much, but he would be curious as to how many hours were spent in budget discussions arguing over $3,500 for a fireworks show at the Air Station, that issue argued by the now Mayor, that it was a function in which the City should participate, that seemed to be a serious amount of money for the Council to worry about, again, the penalty of $2,000 was established by a City Council if the TOT was not paid as it is taxpayer money. Councilman Yost urged that the Inn owners not leave the community, this is a valuable business, the Inn is wonderful and he wants it to stay, offered his services if he can do anything to help, however asked that the owners help the Council to do what it has to do legally. Councilman Larson noted that the people in this town remember how the Council votes on everything, if he was to vote to waive this penalty he is certain someone down the line will remember that the Council waived the penalty for the Inn and request that theirs be waived as well. Councilman Doane mentioned that he has been at Chamber functions at the Inn, it is beautiful, unique, one of a kind, he would not want to see the owners leave, he was sorry that they made that type of threatening comment, he too will vote for the waiver however hopes that the owners have learned from this experience, not only can it bring embarrassment but they are also tax collectors, the money is not theirs, that needs to be emphasized. Mayor Campbell agreed that there is no doubt that the Inn is a unique business, many such facilities had problems following 9/11, however it needs to be kept in mind that the appropriation of taxes for personal use is a felony in California, the federal government will tell someone that not being aware is no excuse, however the owners have now paid the principal and interest, she would not want to see this business hurt any more, some of the things that happened were basically Murphy's law, if things should happen again the owners should just make the payment. The Mayor said her belief is that none of the Council want to see the penalty assessed because the Inn is a special place and has put Seal Beach on the map. She does not believe that I I 3-8-04 / 3-22-04 the Council feels 'what it does is considered to be unfriendly towards business, there are many people in the community that do not have business licenses as they should, the City is starting to resolve that problem, a repairman for instance, does he need a permit in every city in which he does business, sometimes the answer is yes, but there are those who try to skirt the regulations. I Vote on the motion to waive the $2,000 penalty: AYES: NOES: Antos, Campbell, Doane, Larson, Yost None Motion carried The City Attorney stated that unless there is objection, staff will bring back an amendment to the Code to require that the TOT funds be segregated and that current addresses be required for business owners to which notices can be sent. CLOSED SESSION No Closed Session was held. ADJOURNMENT It was the order of the Chair, with consent of the Council, to adjourn the meeting until March 22nd, 2004 to meet in Closed Session if deemed necessary. By unanimous consent, the meeting was adjourned at 8:50 p.m. I cio clerk each APproved:~~ ! 0t~ Mayo Attest: Seal Beach, California March 22, 2004 The City Council of the City of Seal Beach met in regular adjourned session at 6:30 p.m. with Mayor Campbell calling the meeting to order with the Salute to the Flag. ROLL CALL Present: Mayor Campbell Councilmembers Antos, Doane, Larson I Absent: Councilmember Yost Councilman Yost arrived at the meeting at 6:34 p.m.