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HomeMy WebLinkAbout2011/05/26 - Minutes - SpecialMay 26, 2011 CITY OF RANCHO CUCAMONGA CITY COUNCIL MINUTES REDEVELOPMENT AGENCY MINUTES FIRE PROTECTION DISTRICT MINUTES SPECIAL MEETING A. CALL TO ORDER A special meeting of the Rancho Cucamonga City Council, Redevelopment Agency and Fire Protection District was held on Thursday, May 26, 2011, in the Tri-Communities Room at the Civic Center located at 10500 Civic Center Drive, Rancho Cucamonga, California. MayorlChairman/President L. Dennis Michael called the meeting to order at 5:00 p.m. Present were Council Members/Agency MemberslBoard Members: Bill Alexander, Chuck Buquet, Diane Williams, Mayor Pro TemNice Chairman/Vice President Sam Spagnolo and Mayor/Chairman/President L. Dennis Michael. Also present were: Jack Lam, City Manager/Executive Director; John Gillison, Assistant City Manager; Linda Daniels, Deputy City Manager/Community and Economic Development; Tamara Layne, Finance Director; James Troyer, Planning Director; Mark Steuer, Director of Engineering Services; Kevin McArdle, Community Services Director; Trang Huynh, Building and Safety Services Director; Robert Karatsu, Library Director; Chief Joe Cusimano, Rancho Cucamonga Police Department; Chief Mike Bell, Rancho Cucamonga Fire Protection District; Joe Pulcinella, Animal Services Director; Jim Frost, City Treasurer and Debra L. McKay, Assistant City Clerk/Records Manager. ...... B. PUBLIC COMMUNICATIONS No communication was made from the public. ...+._ C. ITEMS OF DISCUSSION C1. DISCUSSION AND CONSIDERATION OF PROPOSED BUDGETS FOR FISCAL YEAR 2011/12 A staff report was presented by Jack Lam, City ManagerlExecutive Director. Mr. Lam outlined the fiscal challenges inherent in the national and state recession and summarized how the organization had adapted to the challenges though budget reductions and cost containment strategies. He presented a summary of the City General Fund operating budget as well as key revenue sources. Charts were presented showing how revenue sources have declined in the City General Fund. The Fire District and Library operating budgets and their revenue sources were also discussed. Mr. Lam addressed the budget strategy during these fiscal challenges and the benefits of a "soft landing" approach. In response to the economic downturn, he outlined numerous actions that have been taken to achieve this "soft landing", including strategic cost reduction measures, attrition management, consolidation of various functions, shifting eligible staffing to capital projects and other grant funded programs and using the American Recovery and Reinvestment Act funding as well as other funding opportunities. He noted that staff has taken on significant additional burdens even as the City's staffing resources have shrunk. He reported that staff has been reduced by 76.1 full time positions since 2007. Proposed Budgets for Fiscal Year 2011112 Redevelopment Agency, Fire Protection District, City Council Minutes May 26, 2011 -Page 1 of 3 Mr. Lam indicated that the "soft landing" has been achieved in the Fiscal Year 2011/2012 budget. He noted that the revenue decline has stabilized and the budget reductions and budget adjustments are now in alignment with the bottom of the revenue curve. Also, Mr. Lam stated that while revenue is growing in some areas, the revenue growth is being accompanied by a rise in the cost of goods, supplies, and services. The Fiscal Year 2011/2012 operating budget will utilize no reserve funds, thus achieving the City Council's goal for this budget. He noted that economists are predicting a period of several years near the bottom of the fiscal "trough" before actual growth is seen. Mr. Lam presented a budget analysis of the Fiscal Year 2011/2012 budget. The City General Fund is recommended to be $63,507,030, which represents a 1% increase from Fiscal Year 2010/2011 and an 8.8% reduction from Fiscal Year 2008/2009. The budget provides for a continuation of essential public services and absorbs $878,560 of fixed operating cost increases. The only new program addition is to absorb the basic Senior Transportation Program. Mr. Lam stressed that there was no OPEB unfunded liability in this budget. The Fire District operating fund was discussed, which is recommended to be $25,807,800. This represents a 3.4% increase over Fiscal Year 201012011. This budget absorbs $676,740 of fixed operating cost increases and reflects a full year of the fire inspection program. Mr. Lam indicated that the budget maintains the attritted positions and noted that there was no OPEB unfunded liability in the Fire District's operating budget. The Library operating budget was discussed and is recommended to be $3,974,210. This represents a 1.8% reduction from Fiscal Year 2010/2011 and an 11.5% reduction from Fiscal Year 2008/2009. The Library budget reflects the possible loss of all State Public Library funding. Mr. Lam noted that attrition management and successful grant programs have helped to maintain service levels. The book budget was reduced, but the hours of operation remain the same. Lastly, he noted that there was no OPEB unfunded liability in the Library's budget. Mr. Lam addressed Special District revenues, including those in Community Facilities Districts, Landscape Maintenance Districts and Street Lighting Districts. He noted that the delinquencies have appeared to have peaked. Mr. Lam indicated that the Proposition 218 process will be started for Landscape Maintenance District 2 and expected that the assessment for Landscape Maintenance District 1 will be revisited in Fiscal Year 201112012. The Community Development Block Grant funding was discussed. While a 15% decrease was initially expected, Mr. Lam indicated that the decrease will actually be 16.7%. He outlined the anticipated impact to the Fiscal Year 201112012 budget. This item has been scheduled for the June 1, 2011 Council meeting. Mr. Lam confirmed that all of the recipients have been notified of the decrease in funding. The Capital Improvement Program was discussed, with Mr. Lam stating that these funds are restricted and can not be used for general operating costs. The capital projects for Fiscal Year 2011/2012 include the Base Line Road at I-15 interchange, master planned storm drains on Archibald and Lemon Avenues and a median island retrofit from Haven Avenue from 4'" to 19`" streets. Lastly, Mr. Lam addressed the Redevelopment Agency. He noted that the State took away $32 million in Fiscal Year 2009/2010 and more than $6 million in Fiscal Year 2010/2011. The Agency opposes Governor Brown's proposal to eliminate all Redevelopment Agencies and will continue to work on infrastructure and programs which attract and maintain businesses and result in job creation. In closing, Mr. Lam noted that the Fiscal Year 201112012 budget reflects the current realities of the Great Recession and also the priorities and goals of the City Council. After three years of cost cutting, this budget will achieve the goal of a "soft landing" and does not include the use of reserves. Mr. Lam expected that the City will remain in a fiscal "trough" for several years. Key factors to monitor include: Any negative State budget action(s) that further divert local revenue, revenue performance for the remainder of the calendar year and the outcome of the Countylpublic labor negotiations. Mr. Lam indicated that the City has been given an AA credit rating and still maintains a $13,745,456 reserve. The budget preserves basic City services and continues the priority on public safety. Mr. Lam indicated that the City and the Fire District have no unfunded OPEB liability and have eliminated any reliance on reserves. Also, the City and the Fire District have implemented pension reform to help ensure long-term fiscal stability. Proposed Budgets for Fiscal Year 2011 /12 Redevelopment Agency, Fire Protection District, City Council Minutes May 26, 2011 -Page 2 of 3 Mr. Lam stated that the downsizing, restructuring and cross utilization of staff have enabled the organization to adapt to the new reality. During this Fiscal Year, he noted that the City Manager's Office will be working with all Departments to develop a comprehensive succession plan as well as an organizational restructuring plan. He thanked all of the employees who remain committed to providing the community with the best services possible utilizing the resources available during these difficult times. Mayor Pro Tem Spagnolo thanked all of the employees for their contributions in making these budgets work. It is hard to believe that so many positions have been attritted. He appreciated the very soft landing. Council Member Buquet noted that the City was a shining example of how fiscal planning should occur. He noted the many communities who were unable to manage their expenses. The Council Member appreciated the conservative approach taken in preparing the budgets. Regarding the succession planning and restructuring, Council Member Buquet suggested that the 71.6 full time positions be removed from the table and that each Department Managers focus on what was needed to meet future Departmental goals. Once the economy recovers, Council Member Buquet suggested atwo-prong approach, noting the need to replenish the reserve as well as to provide for the employee groups who had sacrificed during these hard economic times. Council Member Williams noted that the implementation of Team RC was very apparent in this balanced budget. She appreciated the fact that everyone worked to pull through the Great Recession and concurred with the suggestions made by Council Member Buquet. Council Member Alexander concurred with the comments that were made. In response to Mayor Michael, Mr. Lam indicated that he would be watching for future State action and monitoring revenue streams. Mr. Lam indicated that quarterly reports would be provided to the City Council. Also discussed was the need to meet with every Department to address a succession plan as well as a restructuring plan. Mayor Michael noted that $900,000 was used last year in reserves and pointed out that this budget was balanced even with unavoidable fixed cost increases. He applauded all Departments for their hard work and dedication to the City. In response to Mr. Lam, the Council Members indicated that the second budget workshop, tentatively scheduled for June 2, 2011 was not needed. Mr. Lam indicated that a special meeting would be held on June 9, 2011 so that the budgets can be considered and adopted. This meeting was open to the public and would be in the City Council Chambers. Council Member Alexander indicated the need to meet with Mr. Lam to discuss personnel issues. Council Member Buquet noted that the June 9, 2011 meeting could accommodate any needed budget changes. E. ADJOURNMENT The meeting adjourned at 5:49 p.m. Resp!?cffully submitted, ,,~ ~ Debr L. McKay, MM Assistant City ClerklRecords Manager Approved: June 15, 2011 Proposed Budgets for Fiscal Year 2011112 Redevelopment Agency, Fire Protection District, City Council Minutes May 26, 2011 -Page 3 of 3