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HomeMy WebLinkAbout2012/01/04 - Minutes - SpecialJanuary 4, 2012 CITY OF RANCHO CUCAMONGA CITY COUNCIL MINUTES SPECIAL MEETING A. CALL TO ORDER A special meeting of the Rancho Cucamonga City Council was held on Wednesday, January 4, 2012, in the Tri-Communities Room in City Hall, located at 10500 Civic Center Drive, Rancho Cucamonga, California. Mayor L. Dennis Michael called the meeting to order at 4:00 p.m. Present were Council Members: Bill Alexander, Chuck Buquet, Mayor Pro Tem Sam Spagnolo and Mayor L. Dennis Michael. Council Member Diane Williams was absent Also present were: John Gillison, City Manager; Jim Markman, City Attorney; Linda Daniels, Deputy City Manager; Mark Steuer, Engineering Services Director, City Engineer; Tamara Layne, Finance Director; Debra McKay, Assistant City Clerk/Records Manager and Shirr'I Griffin, Deputy City Clerk. ,..... B. PUBLIC COMMUNICATIONS 61. There was no one from the audience who wished to speak. C. ITEM OF DISCUSSION C1. Update on Street Light Maintenance Districts Linda Daniels, Deputy City Manager, presented the staff report. Mark Steuer, City Engineer and Fred Lyn, Utilities Division Manager assisted in the presentation. Christian Nelson from Southern California Edison was present. She gave a brief summary about the formation of the City's eight Street Lighting Districts (SLDs) established in the community in the 1980s and 90s pursuant to the 1972 Landscaping and Lighting Act. Maps detailing District locations, boundaries and areas were distributed to the City Council. Ms. Daniels stated that the intent of the Districts was to establish a dedicated funding source for the operations and maintenance of community street lights and traffic lights. Ms. Daniels stated that subsequent to the formation of the community's Street Lighting Districts in 1996 Proposition 218 was approved by the voters. Prop 218 requires a vote of the effective property owners for any assessment change. Since 1996, SLD assessment rates have not changed. However, she noted that during the same 15 year time frame, increases in casts have occurred. To help meet expenditures of the SLDs, Reserve Funds and Gas Tax have been used. Ms. Daniels introduced Fred Lyn, Utilities Division Manager, to talk about specifics on the SLD utility fees. Mr. Lyn addressed the utility bill, which consisted of two portions: 1) Energy costs which is, for example, the energy used for the street light; and 2) Distribution charge, in this case, a per pole charge which is 75% of the utility bill, the majority of the bill. Mr. Lyn noted that the per pole charge is the cost to bring the energy into that street light pole, operations and maintenance costs and cost recovery costs. Special Minutes of the Rancho Cucamonga City Council January 4, 2012 -- Page 1 of 3 Mr. Lyn stated that one of the issues to be addressed was the cost to the District if a street light were completely turned off. In this event, the District currently would still have to pay the 75% distribution charge. He noted that numerous cities, including the City of Rancho Cucamonga, have had conversations with Edison to clarify the street light charges. At this point, he noted that the City has concluded that the explanations provided were not adequate and that more information was needed. In October, he indicated that the City of Moreno Valley filed for (and was granted) Party Status with the California Public Utilities Commission through the (2012) General Rate Case. The City of Rancho Cucamonga has become a joint participate with the City of Moreno Valley in this matter. Mr. Lyn introduced Mark Steuer, City Engineer, to talk about the District's use of Gas Tax. He addressed the commonly asked question of whether or not utilizing Gas Tax money is an eligible expenditure when it comes to paying the electrical needs of a street light. In the State guidelines related to Gas Tax expenditures, under the maintenance section, Mr. Steuer noted that it specifically states that Gas Tax money may be used for: "furnishing power for street or road lighting and traffic control devices." However, Mr. Steuer noted that Landscape Maintenance Districts may not use Gas Tax funding as this does not meet the funding criteria. Also, Mr. Steuer noted that the City should monitor how much Gas Tax money is used for other purposes other than it's primary purpose to inspect, manage and maintain the roadway payment City-wide. He addressed the statewide needs assessment study, noting that the State-wide Pavement Condition Index was at 68. According to the State, this categorizes State-wide roads at an "At Risk" condition. By comparison, the City's PCI is at 82, which places the City's roads in the "Good to Excellent" category. Also discussed was the widely accepted industry standard to maintain a road at a good condition rather than not funding its repair for several years (thus letting the street deteriorate) and bringing the road back up to a good condition. Ms. Daniels noted that the City is looking at cost reductions in the SLDs since revenues are not meeting expenses in a majority of the SLDs. The purpose of this meeting was to ensure that the City Council was aware of the issues and the potential for reduction in expenditures depending on the outcome of the Moreno Valley (2012) General Rate Case as described by Fred Lyn, Utilities Division Manger earlier. Ms. Daniels recommended that policy be affirmed by the City Council to authorize up to 20% of Gas Tax funding to be used for the SLDs to help with expenditures. She cautioned that this was not meant to jeopardize City roadway payment condition but to provide support to the SLDs until work can be done on the expenditure reductions. She outlined the other two recommendations: 1) Confirm participation with Moreno Valley in filing for the Party Status and, 2) Direct staff to continue to monitor the SLD accounts and notify Council in advance of the need of a Proposition 218 election. Ms. Daniels stated that this outcome may occur sooner or later depending on the City's ability to reduce expenditures, be successful in discussions with Moreno Valley and other cities on the (2012) General Rate Case with SCE. Mr. Gillison noted that in the past City Council has drawn a hard line around the use of the General Fund to subsidize or help any special districts. He said the idea being that the special districts, either landscaping or street lighting, were originally created to fund their own way without the General Fund money. He also emphasized that the use of the Gas Tax is a short term solution. He addressed a concern that has been raised in the past about providing adequate advance notification of a pending Proposition 218 election to the affected property owners. In this case, it may be premature to contact residents of the SLDs until after the General Rate Case is resolved. In response to Council Member Alexander, Mr. Gillison addressed the per pole costs. He noted that Moreno Valley, Vista, Lancaster, and Rancho Cucamonga have been asking these questions and trying to obtain this information for six or seven years. As the information received to date does not make logical sense, the continued participation before the PUC is recommended. Mr. Gillison noted that the tariff was approved by the PUC a number of years ago. It happened to be the timing again for the next cycle so Edison was literally already in the process of asking the PUC for approval for their next tariff which includes all tariffs called their (2012) General Rate Case. One of those is the street light tariff. Special Minutes of the Rancho Cucamonga City Council January 4, 2012 -- Page 2 of 3 Council Member Alexander noted that five or six year discussion was unacceptable. He asked if every resident, not just the public agencies, were charged the same type of charge to maintain poles. Mr. Gillison clarified that this is in regards to residents who are in a Street Lighting District and estimated that 70-75% of the City in a SLD. Discussion was held regarding the number of poles in the City (approximately 17,000) and the monthly cost per pole. Mayor Michael referenced the cost recovery period of ten years and noted that many poles in the City were older than ten years. In response, Mr. Gillison noted that the most appropriate recourse for this issue is discussion with the PUC, as the street light tariff was established by the PUC initially. In response to Council Member Alexander, Mr. Gillison did not believe that any adjustment made by the PUC would be retroactive. Mayor Pro Tem Spagnolo inquired about the timeframe for discussion and resolution. In response, Mr. Gillison expected that the best case scenario would be one year but noted that it may take two or three years to resolve. Mayor Pro Tem Spagnolo was very reluctant to consider a Proposition 218 election and was especially reluctant to consider one without this matter being resolved. In response to Mayor Pro Tem Spagnolo, Mr. Nelson noted that Edison could remove the photocell from the street light but indicated that there would still be the customer charge of 75% of the cost. Mayor Michael addressed the use of the Gas Tax and confirmed the recommendation on the use of this funding. He requested that the City Council be appraised way in advance if any SLD required a Proposition 218 election. Council Member Buquet was disappointed that the City was in this position and raised the need to inform the property owners. In response to Council Member Buquet, Mr. Gillison suggested that the issue with the poles be addressed so that clear and complete information can be provided. MOTION: Moved by Council Member Buquet, seconded by Council Member Alexander, to approve the staff recommendations in the staff report. Motion carried 4-1-0, Williams absent. D. ADJOURNMENT Mayor Michael adjourned the meeting at 4:48 p.m. Respectfully Shirr'I Griffis Deputy City Approved: February 1, 2012 Special Minutes of the Rancho Cucamonga City Council January 4, 2012 -- Page 3 of 3