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HomeMy WebLinkAbout2013/05/30 - Minutes - Special May 30, 2013 CITY OF RANCHO CUCAMONGA CITY COUNCIL MINUTES FIRE PROTECTION DISTRICT MINUTES SPECIAL MEETING A. CALL TO ODDER A special meeting of the Rancho Cucamonga City Council and Fire Protection District was held on Thursday, May 30, 2013, in the Tri-Communities Room at the Civic Center located at 10500 Civic Center Drive, Rancho Cucamonga, California. Mayor/President L. Dennis Michael called the meeting to order at 5:00 p.m. Present were Council Members/Board Members: Bill Alexander, Marc Steinorth, Diane Williams, Mayor Pro Tem/Vice President Sam Spagnolo and Mayor/President L. Dennis Michael. Also present were: John Gillison, City Manager; Linda Daniels, Assistant City Manager; Lori Sassoon, Deputy City Manager/Administrative Services; Tamara Layne, Finance Director; Chris Paxton, Human Resources Director; Jeff Bloom, Deputy City Manager/Economic and Community Development; Candyce Burnett, Planning Manager; Mark Steuer, Director of Engineering Services; Bill Wittkopf, Public Works Services Director; Robert Karatsu, Library Director; Nettie Nielson, Community Services Director; Trang Huynh, Building and Safety Services Director; Chief Mike Bell, Rancho Cucamonga Fire Protection District; Veronica Fincher, Animal Services Director, Police Chief Mike Newcombe and Debra L. McNay, Assistant City Clerk/Records Manager. B. PUBLIC COMMUNICATIONS No communication was made from the public. G. ITEMS OF' DISCUS ION C1. DISCUSSION AND CONSIDERATION OF PROPOSED BUDGETS FOR FISCAL YEAR 2013/14 John Gillison, City Manager made a PowerPoint presentation on the proposed budgets for Fiscal Year 2013/14. He indicated that Fiscal Year 2013/14 marks the first budget since Fiscal Year 2009/10 that will actually experience mostly overall positive growth. While the revenue growth remains modest, costs are on the rise again also. The economic outlook, although cautious, is at least headed in a positive direction. Mr. Gillison indicated that there are still challenges at the Federal level with the debt ceiling, the budget deficit and Federal tax reform. Also, he noted that State finances are far from certain and continued encroachment into local revenue remains a distinct possibility. Local issues include pension costs, financial challenges in some landscaping and street lighting districts and the need to rebuild reserves. Mr. Gillison noted that the City is starting to restore services that were cut in prior years. Also, there is a continuation of the restructuring and reorganization of City staff. The City's revenues, which are largely based on sales taxes, will rise as unemployment drops and job growth picks up. Proposed Budgets for Fiscal Year 2013/14 Fire Protection District, City Council Minutes May 30, 2013- Page 1 of 4 In response to Council Member Alexander, Mr. Gillison noted that it is too soon to know what the impact to sales tax revenues will be as a result of sales tax being collected from Internet sales. Mr. Gillison discussed in more detail the principal challenges for Fiscal Year 2013/14. These include finishing the adjustment to the permanent loss of RDA funding and the programs, projects, services, and personnel that were supported with those funds. There is a need to begin the negotiations on new MOU's for all employee groups to manage the continuing increase in PERS rates, which will place emphasis on employee cost sharing. Also, there is a need to continue to address the fiscal challenges in key special districts, such as PD 85 and LIVID 1. The goal to offset rising utility and fuel costs with increased efficiencies, cost savings in other areas, technology improvements, or new revenues was identified. Also, the goals to balance the City's operating budget without using reserves; the desire to eliminate various temporary budget stabilization practices and to rebuild reserves was discussed. Mr. Gillison also highlighted the need to initiate construction on the Base Line / 1-15 interchange project as well as the creation of a new Economic Development Plan and strategy for the City considering the loss of redevelopment and the changing nature of the marketplace. Fiscal Year 2013/14 budget highlights were identified. Mr. Gillison spoke about the proposed Increased expenditure, from General Fund monies, for infrastructure replacement and funding of missing sidewalk segments and street repaving and/or replacement projects in the Capital Improvement Program. Also funding is proposed to address necessary reclassifications, position upgrades and/or consolidations, etc. Lastly, Mr. Gillison discussed the impact of the Affordable Care Act on part-time staff. Council Member Alexander noted the reference to private contracts. He noted that the City should consider if hiring additional employees would be more cost effective. In response to the funding for personnel adjustments, Mayor Michael noted that $600,000 in revenue was needed to balance these costs. Council Member Steinorth inquired about the impact of the Affordable Care Act on part-time staffing levels. As the number of hours is proposed to be reduced for some positions, he inquired if the time to train new employees and the subsequent loss of knowledge was taken into consideration. Mr. Gillison confirmed that this had been specifically studied for each position. A cut in hours could be accommodated in many positions. However, there are some specialized positions in which this alternative may not be recommended. These positions are currently being reviewed. In response to Mayor Michael, Mr. Gillison addressed the available alternatives to adjusting to the Affordable Care Act. One alternative would be to provide affordable health care to all part time staff working 25 hours of more. Staff has reviewed the guidelines and determined that a $400 per month per position would be needed. Another alternative would be to pay a fine for not providing the coverage. The compromise proposed is to reduce the hours for most part time positions with affordable health care being provided for the remainder. Which alternative to choose is a policy decision to be made by the City Council. In response to Mayor Pro Tem Spagnolo, Mr. Gillison confirmed that there is no provision in the Affordable Care Act for part time employees to use existing insurance. The City Manager noted; however, in the future the law may be amended to further define what part time status is. This may eventually require the City to choose to provide affordable health care insurance to everyone. Mr. Gillison continued with the Fiscal Year 2013/14 budget highlights. He reported that the proposed budget includes an increase to the Sheriff's contract. As there are future anticipated cost increases, he will be conducting an analysis of the cost of contract law enforcement services. Mr. Gillison reported that community clean-ups will be increased from one to three events per year; there is a restoration of hours at the Household Hazardous Waste site and a restoration of book budgets, event supplies, and special event programming. Funding has also been included to enhance senior transportation. The City Manager reported that work continues toward ensuring long-term fiscal sustainability in landscape and street lighting districts citywide. He noted that Landscape Maintenance District No. 2 is currently Proposed Budgets for Fiscal Year 2013/14 Fire Protection District, City Council Minutes May 30, 2013- Page 2 of 4 undergoing a property owner mail ballot, with the results being decided on June 5, 2013. If the mail ballot process passes, there will be an increased assessment and if it fails, services and maintenance should be reduced. In response to Mayor Michael, Mr. Gillison indicated an estimated 1.4 million dollars would be needed to cover the total deficit for all Districts per year. Mr. Gillison noted that the preliminary budget includes funding for the Metrolink Station. He expected that the next districts to be considered for a rate increase would be PD 85 and LIVID 1 as both are currently operating at a deficit. Also discussed various legal issues which impact the City. The Public Employee Pension Reform Act enacted new, much lower pension benefit tiers and other changes for new employees hired after January 1, 2013. Mr. Gillison noted that the City is well-positioned to recognize an optimum amount of savings from PEPRA. He noted that the Public Employees' Retirement System has implemented additional reform measures to help ensure financial stability of the pension system. While this is a positive step for the long term viability of the system, Mr. Gillison expected that pension costs would rise by 6-11% of pay over the next several years. Also discussed was the Property Tax Administration Fees. The County's increased fees were challenged by many local agencies and the California Supreme Court sided with local agencies in this dispute. In response to Mayor Pro Tem Spagnolo, Mr. Gillison noted that the refund amount due to the City is still be litigated. Mr. Gillison discussed the waste and storm water related regulation, noting that the MS4 permit now has 31 new requirements that are impacting the City. The budget proposes adding a full-time position in the Environmental Programs section to help stay in compliance with the regulations. In response to Mayor Michael, Mr. Gillison confirmed that the MS4 permit is a Federal requirement, which mandates regular inspections by the City. Funding for special events was discussed. Mr. Gillison noting that the budget proposes a dedicated line item of $89,000 for public sector costs to properly manage the Thoroughbred Holiday Light Display. In response to Council Member Alexander, Mr. Gillison estimated that $66,000 was spent in 2012. He noted; however, that the cost to manage this event will fluctuate due to the number of weekends before Christmas and the weather. In response to Council Member Alexander, Mr. Gillison confirmed that the General Fund would pay for this expense. Council Member Alexander noted that this is not dissimilar to the budgetary needs of Landscape Maintenance District#2, but in that case the property owners in that District pay. Mayor Michael noted that there has been discussion about decorating homes for Halloween. He suggested that staff explore options to ensure that a light display like this not happen again. In response, Mr. Gillison indicated that a permit could be required along with specific requirements. Council Member Williams inquired if a business license and a permit from the Health Department would be obtained during the Thoroughbred Holiday Light Display. Mr. Gillison confirmed that these permits would be needed. Mr. Gillison discussed the proposed operating budgets for Fiscal Year 2013/14 and compared them to prior years. He addressed the key revenues for the City General Fund, which consists of sales tax, vehicle license fees, franchise fees, property tax, development fees, business licenses and transient occupancy taxes. In response to Council Member Williams, Mr. Gillison noted that the number of foreclosures and short sales have returned back down to their historical level and did not anticipate that much of the property tax is being received on a one time basis. The revenue sources for the Fire District and Library funds were also discussed. Mr. Gillison discussed the changes in the operating budgets and the reserve levels over the years. Council Member Steinorth wondered if the City is doing all it should to enhance its reserves. In response, Mr. Gillison noted that it is a balancing act that would require the City to keep cutting services to fully repay the reserves. He noted that these reserves were built over time. Also, what is not spent at the remainder of the fiscal year is placed back into the reserve. This is how all of the reserves were historically built. Mayor Michael noted the need to rebuild the reserves lost with the elimination of the redevelopment agency. In response, Mr. Gillison noted that for the first time, it is proposed to place $508,000 into the City's capital reserve. Proposed Budgets for Fiscal Year 2013/14 Fire Protection District, City Council Minutes May 30, 2013- Page 3 of 4 Mr. Gillison presented an operating fund analysis for the City General Fund and the Fire District. Mayor Michael noted a proposed use of reserves for CFD 85-1. This is due to CAP allocation and revenue reductions. In response to Mayor Michael, Mr. Gillison noted that non-CFD property tax revenue growth from the RDA elimination continues and should help to eliminate the use of reserves. Mr. Gillison presented an operating fund analysis for the Library Budget. Property tax growth has enabled the Library to partially restore operating budget cuts from the prior year. However, he noted that $180,000 has been lost from the CLSA Direct Loan and Public Library Foundation programs. Consequently, the Library has been maintaining certain vacancies and implementing successful grant programs that have helped shore-up services. Lastly, Mr. Gillison discussed the proposed Capital Improvement Program. There is an ongoing investment in pavement rehabilitation, Americans with Disabilities Act projects, park and playground repairs, and facilities improvements. Planned capital improvements include the 1-15/Base Line interchange, the development of the second floor design for the Biane Library, the final design of Southwest Cucamonga Park, LED street light enhancement project in Street Light District 8 and two utility underground projects. RCMU is doing a line extension along Church Street from Bass Pro to Etiwanda Avenue; there are five sidewalk improvement projects planned and nineteen street improvement projects. Also, he noted that City Hall will be reroofed and the fueling infrastructure at the City Yard will be improved. In summary, Mr. Gillison reported that the City remains committed to maintaining its 30+ year tradition of fiscal stability and providing the highest quality services within budgetary constraints for the community. Looking ahead, he noted that careful plans should be laid in order to ensure high development standards are kept, the infrastructure is properly maintained and that long-term fiscal sustainability of the organization remains at the forefront. Mr. Gillison noted that a second budget workshop has been scheduled for June 6, 2013 at 5:00 p.m. Mayor Michael encouraged the City Council members to meet with the City Manager with their specific questions so that policy decisions, if needed, could be made at the next meeting. E. ADJOURNMENT The meeting adjourned at 6:35 p.m. Respectfully submitted, Debra L. McNay, MMC Assistant City Clerk/Records Manager Approved: July 3, 2013— Regular Meeting Proposed Budgets for Fiscal Year 2013/14 Fire Protection District, City Council Minutes May 30, 2013- Page 4 of 4