HomeMy WebLinkAboutCC Min 1995-06-06
5-22-95 / 6-6-95
8:24 p.m. The Council and Agency reconvened at 9:19 p.m. The
City Attorney announced that the Council gave direction with
respect to the City Manager position, and the Agency gave
direction with r~gard to negotiations for the Zoeter Place
property.
ADJOURNMENT 1
It was the order of the Chair, with consent of the council, to -
adjourn the meeting until Tuesday, June 6th at 6:00 p.m. for a
budget workshop. By unanimous consent, the meeting was
adjourned at 9:20 p.m.
Approved:
of the
Attest:
Seal Beach, California
June 6, 1995
I
The city Council of the City of Seal Beach met in regular
adjourned session at 6:00 p.m. with Mayor Hastings calling the
meeting to order with the Salute to the Flag.
ROLL CALL
Present:
Mayor rlastings
Covncilmembers Brown, Doane, Forsythe.
Absent:
Councilmember Laszlo
Also present: Mr. Bankston, City Manager
Mrs. S~oddard, Director of Administrative
servi.ces
APPROVAL OF AGENDA
Brown moved, second by Doane, to approve the agenda as
presented.
AYES:
NOES:
ABSENT:
Brown, Doane, Forsythe, Hastings
None
Laszlo
Motion carried
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ORAL COMMUNICATW,NS
There were no Ora ,_ Co:nmunications.
BUDGET WORXSHOP
The City Manager expl~ined that the purpose of the workshop was
to present the preliminary budget to set the appropriations for
services for fiscal year 1995/1996, address the revenues and
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departmental budgets any adjustments to past services. He noted
the public hearing for adoption of the budget has been scheduled
for June 26th. Looking at the historical trends of the city
from the standpoint of revenues and expenditures over recent
years, he noted that the General Fund budget for 1995/96 is an
appropriation of $11,813,692, an increase of 1.5 percent over
the 1994/95 budget in spite of the fact that the Consumer Price
Index inflation r~te for that period is nearly 3 percent, thus
half of the inflation has been absorbed by further adjustments,
however upon detailing the revenues and sources of revenue it
will become quite clear that there is need for adjustment of
some of the fees, charges and rates, building permits as an
example, where there ::ontinues to be a decline in the
contribution to the General Fund and a continued reliance on tax
revenues, that percentage increasing, particularly in the areas
of services that are more beneficial to a particular client and
where the cost should be borne by that client rather than spread
to the total population, examples again would be a building
inspection, parks and recreation programs, etc. He explained
that a cost recovery survey has not been done since 1992, at
that time there was considerable adjustment of the fees, and it
would be appropriate to do so again, however a recent change of
state law now requires that any time there is adjustment of a
fee or rate two public hearings are required, examples being
trash rates, water rates, the cost of duplication of documents,
the staff report IPust be prepared thirty days prior to, etc.,
the only exceptiotl being services that are clearly impacted by
the rate of inflation and/or other adjustments, an'example of
that being the impact on the City's refuse charges by actions of
the County with regard to gate fees, and when adjustment of such
fees are considered for adoption under public hearing, language
should be included to reflect that the increase is the result of
a pass-through anq an automatic escalator to the Consumers Price
Index should be built in. The Manager explained however that
some gains in the araa of cost recovery have been made, pointing
out that when the study was done the city was subsidizing all of
the Parks and Recreation activities by sixty percent, it is now
the reverse and as of this year the cost of a class is one
hundred percent, a suggestion would now be to recognize some of
the overhead, the Director, the Secretary, etc. where a portion
of those indirect costs can be spread back.
with reference to Non-Restricted Revenues, revenues from sources
which the Council has full flexibility in deciding where they
are to be spent, ~axes account for 34.25 percent as compared to
last year where they Ilere 33.1 percent and account for property,
utility users, transient occupancy, sales, and other sources of
taxes. As to the potential of further State take-away this
year, the Manager said it appears that the direction of the
State at this time is to take two steps back from Proposition 13
and re-evaluate the entire tax structure, in the future cities
may be faced with decisions between property tax and sales tax,
and some mention at this point is for the State to take sales
tax or some portion thereof, use those monies for schools and
then allow cities one hundred percent of the property tax, for
Seal Beach that could be significant in that the sales tax
generation is within ~he bottom twenty percent of the State
average per capita as opposed to the property tax where there is
a fairly high assessed value by comparison therefore the yield
is greater. The Manager explained that the appropriations of
the City are bro}oen out into funds, some of those funds have
restrictions wher~as the revenues can only be used for
corresponding exp"nses, the lighting assessment district as an
example. The Appt'opriations By Fund reflects the combining of
all financial transac~ions that pass through the city over which
the Council has some authority or control then broken out by
personnel, operating, capital, etc., and as a general rule,
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government being a service industry, labor intensive by nature,
typically in comparison to other cities and counties the
personnel/labor costs start to venture into the eighty percent
range, which is common, yet Seal Beach is below that percentage
and it is hoped that the city can stay within the low to mid-
seventies range thus allowing a more concentrated effort on
operations. To Account 24 in the General Fund, Jail Detention I
Services, the Man~ger noted that for the first year of operation
the expenditures were anticipated to exceed revenues therefore
was treated as a General Fund activity, however in the proposed
budget a zero is reflected because revenues are now exceeding
expenditures and a separate fund has been established
specifically for that facility. He advised that basically the
jail is treated by comparison to private industry as a
subsidiary, having its own income and expense, a wash, estimated
in this budget as $550,000 in revenue and a like amount of
expense, part of the expense is the payment to the city of its
share of the profit, more specifically after the income and
operating expenses the remainder is split fifty/fifty, the share
to the City in fiscal year 1995/1996 is estimated at $119,000,
those monies placed in the General Fund thus allowing the
Council the discretion to utilize those monies as non-restricted
revenues. In reference to the Multiple Year Expenditure
Comparison, he pointed out that it reflects the actual expenses
of years 1992/93 and 1993/94 yet if one were to go back to those
budgets identical numbers will not be seen as less was spent
than was budgeted, and in his opinion in almost all cases,
barring the occurrence of disasters, the City should always
spend less than is budgeted. As a philosophy, there is an
attempt to have the departmental budget estimates realistic and
not too conservative, preferably a little high so that through I
the course of the yea~ there are not cost changes, etc. that
throw the budget out of balance, thus the expenditure estimates
should always be highar than the actual expenses at the end of
the year, the converae to that is that there is likewise an
attempt to not be liberal with the revenue estimates so that if
the revenues are off it is hoped that more revenue is gained
than was anticipated, not less, and that projects are not
approved and then anticipated monies shall short. He noted the
situation was different four years ago where the needs were so
great and the revenues were so short.
Again with reference to the Multiple Year Expenditure
Comparison, the M~nager pointed out that the General Fund
balance of 1992/9~ was $10.8 million, a 3 percent increase to
11.1 in 1993/94, ~he year end for 1994/95 is anticipated to be
$11,190,518 yet $11,640,000 was budgeted which is .06 percent
increase over the prior year, that with inflation at 3.2. He
noted that the Police Support budget was higher this year as a
result of the automation and replacement of vehicles, last year
being the first time in four years that vehicles were replaced,
the State standard is no more than 75,000 miles for a police
pursuit vehicle, the Seal Beach vehicles are in the range of
90,000, one having 128,000 miles. Noted also that the Saleen
Mustang has been advertised for bids, it is in storage at the
yard, a bid of approximately $12,000 has been received thus far, I
and that vehicle will be sold once there is an acceptable offer.
He explained that the State standards for police vehicles are
guidelines establ'ished by the Police Officers Standard of
Training (POST), an advisory standard rather than law, however
should a problem be realized in a pursuit, a prosecuting
attorney would fc::us :;pecifically on the mileage as it relates
to engine failure, brake failure, etc. for the purpose of legal
action against th". city. He confirmed that the entire fleet is
not being replaced, t:.e vehicles proposed for replacement are a
1988 Chevrolet having 127,584 miles, 1991 Chevrolets with
98,620, 95,368 and 94,867 miles, retaining in the fleet a 1991
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Chevrolet with 65,000 miles, 1993's with 43,000 and 56,000
miles, and a 1991 with 86,000 miles. The Manager explained that
the City's mechanic does a full inspection on the vehicles and
when felt necessary the vehicles are sent to the dealership for
an inspection that can be likened to that for a used vehicle in
preparation for sale, the mechanic also utilizes a computer
program that can provide an estimation of the maintenance costs
for a vehicle having a specific mileage which in turn allows the
evaluation of maintenance of the vehicle against the cost of
replacement. He qonfirmed that no city vehicle is allowed to
exceed certain speed limits unless they are in a pursuit
situation, which could be as much as one hundred ten miles per
hour, and in that situation the operation of the vehicle relates
directly to a potential liability. He explained that the two
replacement vehicles contained in this fiscal year budget have
not as yet been purchased, the monies have been held, the
acquisition will be made prior to the end.of the year, some
prices were frozen yet the city has not taken delivery or paid
for those vehicles. He recommended that at some point
consideration be given to establishing a vehicle replacement
fund where monies wil~ be set aside each year for replacements.
The Manager confirmed that the Police Chief and the Captain
operate city owned vehicles, and explained that with regard to
the Chief in lieu of a vehicle the city would need to provide an
auto allowance, then mandate a certain type of vehicle, radio
equipped, and require the individual to equip the vehicle in
specific fashion, some cities have gone that direction, and to
that the City Att..rney has concurred that it can be done however
there are aspects that pose real concern, also, under state law
the police chief is on duty twenty-four hours a day and must be
available to respond, even to an unlawful activity outside the
jurisdiction. The Manager pointed out that funds are in the
Police Department budget for vehicle replacement for an unmarked
vehicle, it is not identified as being for.the Chief, his
present vehicle h~s more than 120,000 miles, it is being
evaluated by the City's mechanic, and until an analysis can be
made those funds are being held, also, prior to going to bid the
Council will have an opportunity to review the specifications
for the vehicle. In this budget, based upon inconclusive
information from the City's mechanic, there are no funds
specifically for replacement of the chief's vehicle. He noted
that the budgeted figure is an estimated cost for Chevrolet
sedans, and a Jeep that is in need of replacement which has
86,000 miles but its undercoating is rusted out. He explained
that Chevrolet ha~ ceased production of the Caprice and the
Impala, the only ~ther sedan for use as a police vehicle is a
Crown Victoria, confirmed the increase of prices, mentioned that
Ford now has a police package for its Explorers, a problem also
is that the sedan vehicles are shrinking in size and the
equipment package is getting greater with the inclusion of
radios, computer syst~ms, videos, etc., in fact a prisoner can
no longer be placed in a Mustang because of its size and the
amount of equipmellt. As a point of information he offered that
an entrepreneur is attempting to purchase one of the General
Motors factories for the production of police and taxi vehicles
only. He confirmed that there are presently two sport utility
vehicles with four wheel drive capability for the Hellman Ranch,
beach, etc., both in reed of replacement, and when
specifications come to the Council in about April for a bid in
May and purchase in July and if by then it is determined that
the Chief's car should be replaced, the Council can then
purchase one rather than two jeeps and the Chief's car, which
would also be a cost ~aving. He, acknowledged that the Chief has
the use of a vehiqle as a benefit however receives no auto
allowance, which ~~ somewhat of a tradeoff, and in most cities
where vehicles are provided to certain employees the type of
vehicle is generally one that fits into the fleet, as an example
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the manager would get an 86,000 mile pOlice car while the police
chief might have the first year use of a new sedan then it goes
into the fleet operation, also, the use of a stick shift Taurus
would preclude that vehicle from any use other than just the
police chief's car, and in the case of the present vehicle, it
has been used on occasion as an unmarked vehicle. He again
noted that Chevrolet is discontinuing the manufacture of the I
Impala and the Caprice, Oldsmobile has downsized their models,
Buick is discontinuing the Roadmaster, some East Coast cities
are purchasing Voivos, however the anticipation is that someone
will get into the police and taxi vehicle manufacture and that
it will be profitable. The Manager explained that the 1995/96
expenditures reflect a 1.4 percent increase over 1994/95, and it
is hopeful that if th9 same kind,of prudent expenditure levels
are maintained there ahould be an ability to increase the fund
balances somewhat by year end.
As to revenues and reference to the property tax, secured, the
Manager pointed out that in 1992/93 the generation to the City
was $2,577,000, and in going back even further to do
percentages, the city has, over a ten year period and until the
last three years, had an increase of property tax revenues of
between 7.5 to 11 percent, in 1993/94 there was a drop to
$2,240,000, representing actual dollars and the effect of AB 8
actions at the state level, and the City has yet to even get
back to where these taxes were in 1992/93, the state, rather
than merely takin1 the $1.7 million, took the source that
generated the $1. ", million, that source forever gone unless
there are new revenue sources or categories or increases in the
current sources. Even though the proceeds from taxes have
increased from 33.1 to 34 percent of the total, actual proceeds
from taxes have decreased by a percent, part of that is in the I
sales tax where the estimated 1994/95 shows an increase from
$1,282,000 to $1,386,QOO however it is important to note that
Rockwell, which ill believed to be the source, sold some
equipment in a resale that netted the City $185,000 in sales
tax, also the City is losing $50,000 per year to the aerospace
rebate for two more years, the total of that rebate being
approximately $200,000, the City'S sales tax is flat, the
1992/93 level was $1,110,000 and that level is not even
anticipated in this fourth year later. Property taxes are down
as is sales tax. As to the barrel tax, the 1992/93 figure
reflects Unocal as being fully operational with the on-shore of
six hundred barrels and Chevron, Chevron is no longer operating,
and the $51,100 1995/36 projection is slightly conservative by
maybe $5,000, however next year they should be operating at a
higher level resu."ting in an enhanced revenue source, their
barrel tax now tied to the Petroleum Index, when it goes up so
does the percentage of tax; there is virtually no growth of the
Licenses and Permits, there is a decline in that tax area which
means one needs to be brought up if another is to stay low, or
expenditures must be :educed or other means of creating revenue
needs to be looked at. There was some discussion claiming a
subsidy of those ~ho use the municipal parking lots with the
Manager offering to euggest that the parking permit revenues be
broken out by source for future consideration of rates. As a I
point of information, the Manager pointed out that 1990/91
General Fund revenues were $12,017,000, 1995/96 revenues are
$11,981,000, and just this year is there revenue equal to the
amount the Council had available to it in 1989 when considering
the 1990/91 budget, also, from 1989 to 1995 there is a combined
Consumers Price Index increase of 15.2 percent yet the city has
not had any incrE~se in net revenue over what there was six
years ago, and on the same side of the issue, in 1991/92
revenues were $13.018,000 or $1.2 million more than revenues
today, in 1990/91 revenues were $12,017,000, the city approved
expenditures of $12,937,000, in essence used up $920,000 from
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its reserves. He noted also that a freeze was put into place
during the 1991/92 budget period, the following year, 1992/93,
the budget dropped from $13 million to $11,400,000, from that
point it has risen to $11,600,000, $11,800,000, about a $200,000
increase per year, otherwise the city would be stagnant on the
expenditure side which means the'city would be absorbing
inflation through cuts because the revenue has. likewise gone
from $13 million to $11,900,900 in three years.
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As to the Reserves of Fund Balance, the Manager noted that at
the end of fiscal year 1989/90 there was a deficit, the same in
1990/91, at the end of 1991/92 all deficits, all repayments to
trust funds that had peen used for operating expenses had been
cleared and the year ended with $33,000, fiscal year 1993/94
ended with $709,000, at the end of the 1994/95 fiscal year it is
anticipated, given the fact that expenditures were below budget,
revenues in actuality were higher than anticipated, another net
gain will be made of $631,000, with those figures combined at
the end of this fiscal year there is anticipated to be
$1,341,000 in reserve, going from a deficit of $1.3 million and
a debt to the trust apcounts of $600,000 to $1.34 million
positive. He pointed out that four years ago the city had a
compensated absences liability of $1.2 million, through the
actions of the Council with regard to the MOU's, a freeze of
vacation accruals to a cap, creating a buy-back program at
current dollars rather than future dollars, that liability is
now $950,000, by the Joint Powers Insurance Agreement the City
is required to have a reserve account of $900,000 for liability
insurance, the Charter requires $1,000,000 as a General Fund
Cash Basis Fund, and taking just those three mandates there
should be a minimum of $2,850,000 reserve, yet twenty is a very
conservative percentage which gives some sense of contingency.
The Manager encouraged the Council to review the budget mid-year
to simply determine a concept as to when the city has arrived at
fiscal security, a reserve of twenty percent of whatever the
annual operating ~xpenses are would be strongly recommended,
however if the City wishes to be prudent, meaning that if the
Council wishes to proyide services, spend some monies, reduce
taxes, etc., the City should fund its reserves conservatively at
least to a level of forty percent, the recommendation would be
to fund at twenty_percent of $11 million and $900,000, at forty
percent of $950,000, nave the $1 million in the Cash Basis,
additionally noted there are still no reserves identified for
facility replacement, 'equipment replacement, vehicle
replacement, or infrastructure replacement. To an inquiry of
Council the Manager said he was certain that the Director of
Administrative Services has the ability and resources to compile
an actuarial analysis of all of the city facilities, the
vehicles as well, however an engineering study would be
necessary to accomplish that for the water and sewer facilities,
the water system being the most critical given the condition of
that system, and reported that a water master study is about
sixty-five percent completed, that being done by an independent
engineer, that study will inventory the complete infrastructure
system for water, 'every waterline will be mapped, with an
anticipated cost and date of replacement, and strongly urged
that the city look at a twenty year program for water and sewer,
and recommended that five year budgets be adopted based upon
that twenty year program, which is the soundest way to address
infrastructure. He e~pressed his opinion-that should a major
problem occur with the water system the impact will be severe in
that no funds havE. b~en set aside for such major
repair/replacement, suggesting that upon review of the water and
sewer accounts he felt that it will be seen that there is an
ability to regulate the rate and fee structu~e to address the
infrastructure issue without having to do so from the proceeds
of taxes, and that action should be taken rather soon. He
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recalled the restructuring of the water rates some two years ago
whereby the intent was to establish a vehicle by which the
Council could begin to identify the revenue capital replacement
to the expense, consumption was broken out from standby yet the
rates remained unchanged, the' standby is basically the cost of
being in the system, and it is hoped the Council will take the
initial step to adjust those rates to some degree, even though I
one hundred percent will need to be achieved over a period of
time. He explained that the standby presently goes into
operations, in turn operations transfers to capital for
immediate capital needs, it is important to now get the standby
out of operations completely and totall~ into water capital
improvement, the operations therefore need to be funded from the
consumption. He noted the standby dollars this year were in the
area of $600,000 with the capital immediate needs around
$300,000, and if this set aside were accomplished there would
have been $300,000 for immediate needs and $300,000 for long
term needs, howevor there would have been a need to cut
operations or rai~e consumption rates to make up that
difference. He explained the City pumps about eighty percent of
its water and buys about twenty percent, yet the amount pumped
is metered and is paid for as well. with regard to the West
Orange County Water Board taking similar actions for
infrastructure repair/replacement, the Manager pointed out that
for the most part Orange County is thirty to forty years old as
to its majority of population housing, likewise the
infrastructure. To a comment from the Council as to some good
faith reduction of the utility users tax, the Manager-emphasized
that no utility users tax monies are going to water, the City
raised water rates to cover water expenses, the impact of a
reduction of the utility tax would in turn reduce revenues for
police, fire, etc., thus his attempts to link specific revenues I
to specific expenditures so that the Council has the ability to
make the determination that a certain expenditure can be done
without or a certain revenue is not needed, budgets in the past
have been presentGd for consideration as one large pie, which it
is not, water costs should equate to water expense, the ideal
would be to have ~he proceeds of taxes cover public safety, the
pUblic expect that their taxes are going towards the public
support staff, fees should be used for parks and recreation and
cover the cost of providing that program, the permits,
inspection fees, etc. used for personnel, business license, etc.
costs, and the service charges on the consumption of water,
sewer, etc. used to pay for those. The Manager mentioned that
property taxes wera used for police services prior to the state
taking them and the only way to make up the loss of those taxes
was through an increase of the utility users tax, the choices
being to increase utility users or cut the police further,
noting that that depa~tment had already been cut twenty percent,
and the impression was that the Council did not wish to cut the
police department further, rather preferred to start building it
back up. He noted that it is the Council that sets the policies
and makes the choices, staff identifies revenue sources and
makes recommendations as to what is thought can be done, if it
is the desire to reduce the general fund budget from $11.6 to
$10 million the u~ility users tax can be reduced by three I
percent. He explained that the utility users tax has not been
used one hundred percent for on-going operations, the fund
balances were taken from a deficit to $1.3 in the period of four
years, and suggested that at the time of mid-year budget review
in January, the Counc:l make the determination to have the $1
million in the Cash Basis as required by the Charter, that the
$900,000 be in tht: Joint Powers Self-Insurance as it is
required, that it is desired that twenty percent of the
operating fund be in an unappropriated reserve for
contingencies, and given that the utility users is not
restricted, place at least forty to fifty percent in the
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compensated absences, then make the conscious public decision
that as the City has now accomplished a prudent reserve, and as
revenues exceed the approved expenditures, the utility users
will be reduced ~y a corresponding amount, that meaning that if
revenues exceed expenditures by $330,000 the utility users can
be reduced by one percent. He noted in fact that the 1995/96
budget is not balanced as it reflects that revenues exceed
expenses by $100,000, the Council has the discretion to increase
expenditures by a like amount or a determination can be made to
hold the expenses if reduction of the utility users is a greater
priority which, at this time, could be done by a half percent,
suggested also that a decision be made as..to what reserve levels
are desired, and once that is attained, which will be
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accomplished soone~ with new or added revenues or further cuts,
to which he expressed his opinion that further cuts will start
to severely impact services, then the utility users tax can be
reduced correspondingly. The Manager stated that if the Council
continues to act prudently on the conservative course that has
been taken for the last three to four years, allow this budget
year to proceed, and if approached on a percent per year basis
as revenues exceed expenses by $330,000 then that is the year to
roll back the utility users.
He commended the courage of the Council in having raised the
utility tax by six percent to the eleven percent, recognizing
that there was a problem and that it was necessary to address
that problem as quickly as possible, the reserves are rising, it
would be imprudent to keep the eleven percent indefinitely just
because it is there, and again reminded that the Council took
that action for no other reason than to equal the state loss,
that loss still there, this gain the result of cuts, the result
of holding budget expenditures down, monitoring and/or freezing
departmental expenditures, and in fact the increase of the
utility users tax diu not equal the amount of the state loss and
where, for comparison purposes, the increase of that tax and
those revenues were only realized in 1993/94,~which was
reflected by the fund balance of $700,000 'while the utility tax
generated $1.6 million, and if the utility tax pad not been in
place the city would have been on the reverse side by a
difference between the $1.6 million and the $700,000. In
reference once ar,ain to the water utility,. the Manager said in
January the existing $7.00 standby fee per dwelling could be
increased to $8.09 and then modestly increase the consumption
rates as well, it is felt that the approximate fifty percent
current offset can be increased to about seventy-five percent to
generate the $330;000, recommended also at that time the City
Attorney should revise the language relating.to pass-throughs
from MWD and MOWDOC bp-cause if they increase their rates the
city is still about five months behind with its rates, thus in
arrears again, whE.re i.t should be an automatic pass-through to
the consumer. The Manager pointed out that in a majority of
cities the utility users rate applies to water and to cable as
well, stated he had obtained a typical bill for a residence for
telephone, electric, gas, water and cable, he then applied the
eleven percent to thr~e of the utilities, then applied their six
or seven percent to the five utilities, and found that the
consumer was paying less than half a percent more here where it
is applied to only three utilities and the dollar amount to the
consumer is no different, the reason that was not done here is
that the city is ')ne ,)f the few cities that has its own water
utility, those rar.es can be kept lower, nQt recognizing the
operational expen~es because a fee has now been attached, and
there is a franchise lee on cable as well; He again explained
that the standby fee is separated out for the purpose of
operations and placed into capital, and if the utility users
were applied it would only be to the consumption. Of the water
fund revenues of about $2 million about $600,000 is standby
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fixed charges, so much per meter, that is moved out and placed
in capital replacement, that covers immediate replacement and a
reserve for long term so that it starts to build, the
consumption is the quantity of water used, so much per gallon,
to which a utility users tax wou~d be applied, and there would
then be a choice to either place that tax in the General Fund or
it could be kept :n the water fund, and looking at the General I
Fund, if the u~ility users tax were reduced from eleven to nine
percent, apply the nine to water and if that generation was not
placed back into the General Fund then you have reduced the
General Fund, and the long term capital has been addressed
through the standby. As to complaints, the Manager said on a
ratio of ten to one he receives more calls for services or
improvements than calls complaining about costs. Again with
regard to the utility users tax, he mentioned that there is
presently nine hundred personal exemptions from the utility
users tax, yet if the utility tax were applied to water and with
Leisure World having a single meter, Leisure World would need to
pay the tax with no e~emptions then recover the costs from their
residents by some means. The Manager acknowledged that there is
a correlation between land use and revenues, and in those cases
the benefits have to be weighed, the DWP site as an example will
eventually be reassessed to provide property tax, the Hellman
property as well with any restructuring whether there are
dwellings or merely improvements, certain areas of the city as
well are getting far more services than they are paying for in
that they are pre-Proposition 13 ownerships where when there is
a turnover the property taxes will increase,. on the other hand
there has been a recession and people are applying for
reassessments. He emohasized that the Council should not
consider reduction of"the utility users tax until such time as
there is consideration of the amounts desired in the reserves I
and what is the ir.tent as to adjustment of other fees, because
if things are being subsidized, such as Parks and Recreation by
forty percent, a ten percent increase would then reduce the
subsidy by ten percent which then frees $58,000 that is
presently from the General Fund that pays for operations that
the utility users tax is paying for. He noted that there is
currently enterprise funds for water and sewer, they pay for
themselves, there is a Redevelopment Agency that the City
continues to subsidize and the City is not getting the
additional revenues that it should for its overhead, DWP would
change that whole equation because it is in the Agency area and
upon its sale the tax increment for that property will increase
considerably, and once it does the City will no longer need to
transfer the more than $100,000 to the Agency and the Agency can
then be charged for the $200,000 plus that the City should be
getting in overhead, that another one percent reduction of the
utility users tax. There are also some cities that operate
parks as an enterprise, no subsidy, they charge considerable
more for use but do not provide a high level of service, a
tennis complex as an example is leased to a pro and that city
receives a percentage of the revenue, his recommendation would
not be to be one hundred percent self-funded but eighty percent
would be reasonable, thus those fees in this community should be
raised. The Manager offered that there needs to be a strong I
political effort on the part of Seal Beach to get the beach as a
stronger commitment from the state, although recognizing the
pride in the beach it is still a state beach, Los Angeles County
has turned theirs back to the state, Seal Beach is one of the
few remaining, an~ no~ed the General Fund contribution to the
Tideland Beach FU1~d on an annual basis, this an impact to the
utility users tax ~s well. Making reference to the First Street
beach concession, he noted that this budget does anticipate
revenues coming from that poncession, pointed out also that
there are few alternatives to increase beach related revenues as
the Tideland Beach agr.eement directs that any monies derived
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from the beach must go to the Tideland Beach Fund, yet the costs
exceed the revenues by a million dollars, charging more for
parking as an example would do little to nothing, however the
more money that the beach can generate is less money that the
General Fund needs to transfer, the taking of:a percentage of
the money derived from the barrel tax could be looked at as an
enhancement to tho Tideland Beach, yet is only a paper wash. He
noted that the stnte will not take the beach back, they are
fighting Los Angeles County, also this beach is more sensitive
in that there is resident~al and commercial adjacent to it
therefore the level at which it would be maintained or not
maintained has a ,direct impact on values and revenues from
elsewhere, the beach is also a resource that services a region,
yet the local taxpayers are paying $35 each for that beach, thus
the state should be lobbied to be a greater participant, the
level of services should be analyzed as to those costs as well.
citing the value of this workshop, the Manager offered to
schedule a more formal presentation for the next regular meeting
or another workshop. He noted however that the only significant
changes to the expenditures consist of a proposal for the
addition of one police officer, the grant for that officer
received this date which provides fifty percent of the officer's
salary for each of the next three years, money budgeted also for
an additional five reserves bringing that total to ten, the
other staff addit~on is one Maintenance Worker in the Landscape
Account, and noteu two terminations that have created vacancies
in addition to other layoffs and cutbacks overall, as to the
city Clerk the one part-time position was increased to full time
accomplished through two part-time person~ from a benefit
perspective, the Secretary then returns to the Manager's office
full time and the Admtnistrative Assistant will then manage
personnel, and establish and coordinate a volunteer program, an
early retirement ~s being looked at for the Public Works
Superintendent with a recommendation to not fill the position,
the Associate Civil Engineer will be a retirement, that position
will need to be filled however possibly at a different level,
interviews are commencing for the Director of Public Works
position for which there were fifty-two applications, those
applications reviewed by six outside Directors and city
Managers, they have now been screened to seven individuals who
will be interviewed by a panel including himself. He pointed
out also that th~ Wor~ers Compensation and. Public Liability are
now about as low ~s one could expect, each making up a
significant porti~n of the reserve that is starting to be built,
there have been safety and training programs that have been
established, particular attention has been paid to the risk
management program, the city Attorney budget has been reduced by
about twenty-five percent and had it not been for certain
litigation this year ..here could have been another $110,000
reduction, there also continues to be other pending litigations
that are unfunded. Ile advised that in one instance funds have
been expended in excess of the city's self-insured retention
level, and the Joint Powers Authority should reimburse back once
the case is settled, however the City may have to seek a court
action to prove that point because the Authority is arguing that
there is only a payback if the case is not won, the language of
the agreement says that upon a loss the attorney fees will be
reimbursed yet if the case is won there is no reimbursement,
noting that this is a self-insured pool of ten cities that have
set up a system that is a disincentive to win.- He noted that
greater efficiencf has been achieved in the surveying and repair
of sidewalks yet the repair of curbs and gutters continues to be
a real problem wi~~ only about $20,000 allocated annually for
sidewalks, curbs and gutters, however some Measure M monies are
now available as well. The Manager explained that the tram is
not as yet included in the budget, one problem being that the
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cost through the only manufacturer that meets the Americans with
Disabilities Act is $71,000, noted that the Parking In-Lieu
monies can not be used for the tram transport on the pier, and
the contract with RUby's does provide that the City shall
provide a tram, also, most trams can not be, used on public
streets, a tram that is of an appropriate size for use of public
streets is then too large for use on the pier, which poses a I
liability, and it is anticipated that a recommendation regarding
the tram will be forthcoming prior to adoption of the budget.
He reported that there had been discussion with Ruby's for the
City to provide the tram and for them to provide the operator in
that the expense to operate the tram is about $20,000 per year,
possibly the availability of service by phone for seniors and
the handicapped rather than a regular route, an alternative
could be an exemption to allow them the use of a small pickup
vehicle for that purpose, the fishing business is unhappy with
the absence of the tram as well and are claiming monetary
damages for the loss of their handicapped and senior customers.
He pointed out that an anticipated General Fund balance at the
end of the fiscal year is $167,000 which does not include the
tram or its operation, the city's liability attorney has some
concerns in that when you charge for the tram transport, even if
it is a quarter, you fall into the category of a public carrier,
and as such the liability is one hundred percent, if there is no
charge there is reduced liability. He explained that the
$71,000 tram is a stretch van with the sides removed and a
different type of top, is ADA approved, and is street available,
the others that have been looked at are in the process of trying
to get their vehicles ADA approved, they are narrower, a single
unit without attachments, but because of those things they are
having a difficult time attaining the width for a wheel chair, I
the lock down mechanisms, the ramp, etc., and the use of a
trailer type will again escalate the liability.
The City Manager stated that the budget as proposed is the
document that will be presented for consideration under public
hearing on June 26th at which time the budget can be amended to
add or delete items, again offered to set another workshop if
desired. He acknowledged a request for an increase of the
meeting compensation of the Planning Commission and City Council
members, and there was some discussion of what actions would
need to be taken to accomplish same. It was also confirmed that
employee expense accounts do not exist and have not for a number
of years, however there is a Council policy for the
reimbursement of expenses. The Manager commended the department
heads for their r~oognition of the city's financial dilemma and
for their cooperation, commended the commitment as well of the
overall staff, also noted that staff has been reduced to ninety-
eight employees from one hundred thirty-seven five years ago.
It was the consensus ~f the Council to continue consideration of
the proposed 1995/96 budget until the June 12th regular meeting.
It was the order af the Chair, with consent of the Council, to
adjourn this meeting until Thursday, June 8th at 10:00 a.m. for
the purpose of Interim City Manager interviews. The Manager
noted that the recruitment for the City Manager position is I
going forward, the brochure designed by Councilmember Forsythe
is being distributed, and ads have been forwarded for
pUblication in Western Cities, Jobs Available, Job Finders and
the ICMA newsletter, the recruitment having a closing date of
July 31st. By unanimous cons t, the meeting was adjourned at
approximately 8:45 p.~. ~
Clerk and ex-off1
of Seal Beach
of the
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Approved:
Attest:
Seal Beach, California
June 8, 1995
The city Council of the city of Seal Beach met in regular
adjourned session'at 10:00 a.m. with Mayor Hastings calling the
meeting to order.
ROLL CALL
Present: Mayor Hastings
Councilmembers Brown, Doane, Forsythe, Laszlo
Absent: None
Also present: Mr. Bankston, City Manager
APPROVAL OF AGENDA
By unanimous consent, the Council approved the order of the
agenda.
,
ORAL COMMUNICATIQIili
There were no Oral Communications.
CLOSED SESSION
It was the order of the Chair, with consent of the Council, to
adjourn to Closed Session to conduct interviews for the position
of Interim city Manager. The Council reconvened at 12:20 p.m.
with three members present and Mayor Hastings calling the
meeting to order. Th~ city Manager reported the Council had
selected Mr. Jack Shelver as the Interim City Manager whose
duties are to commence June 15th.
ADJOURNMENT
It was the order of the Chair, with consent of the council, to
adjourn the meeting until Monday, June 12th at 6:30 p.m. to meet
in Closed Session if deemed necessary.
Approved:
Clerk and ex-of
of Seal Beach
Attest: