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HomeMy WebLinkAbout2012/07/12 - Minutes - Special July 12, 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 Thursday, July 12, 2012 at Rancho Cucamonga Hall at Central Park, located at 11200 Base Line Road, Rancho Cucamonga, California. Mayor L. Dennis Michael called the meeting to order at 6:00 p.m. Present were Councilmembers: Bill Alexander, Chuck Buquet, Diane Williams, Mayor Pro Tern Sam Spagnolo and Mayor L. Dennis Michael. Also present were: John Gillison, City Manager; Linda Daniels, Assistant City Manager; Lori Sassoon, Deputy City Manager/Administrative Services; Bill Wittkopf, Public Works Services Director; Ingrid Bruce, GIS/Special Districts Manager and Debra L. McNay, Assistant City Clerk/Records Manager. B. PUBLIC COMMUNICATIONS Mayor Michael noted that the public communication period would be held after the staff presentation and the question and answer period. C. ITEM(S) OF BUSINESS C1. OPTIONS TO ADDRESS THE STRUCTURAL BUDGET DEFICIT IN LANDSCAPE MAINTENACE DISTRICT (LMD) NO. 2 John Gillison, City Manager, presented background information on LMD No. 2. In order to address costs, the specifications were substantially rewritten, the contract for landscaping was rebid and a lower cost was achieved. Mr. Gillison noted that a Proposition 218 process was conducted, a majority protest was determined to exist and the increased assessment was not approved. The City Council had directed that staff report back on the options available. Bill Wittkopf, Public Works Services Director; presented the staff report. He noted that LMD No. 2 was formed in 1982 and consists of 5,795 single family residential parcels, 525 condominiums, 589 multi-family units, a church, schools, a fire station, 45.16 acres of commercial property and 19.72 acres of vacant property. There are 6 parks and 139 acres parkways, paseos, medians and community trails in the District. Mr. Wittkopf reported that the cost of water has increased 146%, electricity has increased 15%, contract maintenance costs have increased 41% and fuel has increased 367% since the last increase in assessment. He reported that unlike the newer Landscape Maintenance Districts, LMD No. 2 does not provide for automatic adjustments to the assessments in order to cover these increased costs. Mr. Wittkopf indicated that the public landscapes in LMD 2 were reduced to a "C" level of service in 2009 due to insufficient revenue. As noted previously, the landscape maintenance services were re-bid in 2010, which resulted in significant savings and the services levels were returned to an "A" level. In October 2011, he noted that service levels were lowered to a "B" level of service due to budget constraints, where they remain today. Special City Council Meeting Minutes July 12, 2012 Page 2 of 5 Mr. Wittkopf provided budgetary information, noting that the FY 2012/13 budget is $3,102,300. Estimated revenues are $2,880,640, with an estimated shortfall of$221,660. He presented to cost savings option to the City Council. Option 1 would be to decommission 1.5 million square feet of turf area to reduce expenditures by $300,000. Option 2 would be to decommission one acre of land for demonstration purposes and conduct a community engagement process to determine if property owners would prefer an approximate $38 annual increase to avoid decommissioning. In response to Mayor Pro Tern Spagnolo, Mr. Gillison indicated that the last increase in assessment was done in 1993, and believed that it was a small adjustment. Council Member Buquet addressed the stated increases in water and fuel and inquired as to the period of time. In response, Mr. Wittkopf noted that the water, fuel and electricity costs were calculated from 1993 to the present time. The contract cost was calculated from 1994 to 2009. Council Member Alexander noted that only limited options had been provided. He felt that the decommissioning option was akin to punishing a bad child. Council Member Alexander noted that the City set the standards for the landscape maintenance districts and indicated that this is the worst time to request an assessment increase. He inquired if the increase in the assessment could be spread over a period of several years and reserves used so as to lessen the impact to the community. In response City Manager John Gillison confirmed that spreading the increase in the assessment over a couple of years could be done. He noted that any increase in the assessment extends the life of the District and lessens the shortfall. A Proposition 218 election would still be required. In response to Mayor Michael, Mr. Wittkopf indicated that there are 11 landscape maintenance districts, 4 of which contain a provision for a CPI increase. Mayor Michael stated that a concern had been raised with the City waiting so long to bring these concerns to the residents. This time, he noted that the matter is being brought to the public's attention early on so that the community can be engaged in the solution. In response to Mayor Michael, Mr. Wittkopf addressed the cost savings actions taken to date. In response to Council Member Buquet, Mr. Gillison confirmed that staff had explored reducing the size of LIVID No. 2. However, reducing the size did not make much of a difference and would require a Proposition 218 process. He noted that the landscaping is spread equally throughout the District. Council Member Buquet noted that there are not a lot of options available to the Council. He noted that it is easy to gloss over problems and postpone decisions. In response to Council Member Buquet, Mr. Gillison confirmed that staff is still exploring contingency plans. In response to Mayor Pro Tern Spagnolo, Mr. Gillison confirmed that the actual ballot language will need to be very specific. There is not an opportunity to put various scenarios in front of the voters. Mayor Michael asked for comments from the audience. Jeri Lee indicated that the proposal to decommission landscaping was blackmail, not punishment. She expressed a concern with the level of service in the District. Mrs. Lee stated that she had started reporting about the landscaping in 2009 and indicated that Day Creek is not being maintained. She wondered if there would be a guaranteed improvement if the assessment were raised. Lupe Eastman noted that most people in the audience would write a check right now for the $38.00. She was not aware of the deficiencies on Day Creek. She welcomed a community engagement process. Dave agreed that he could write a check right now. However, he noted that the concern was with the level of service. He noted that the need for an increase in assessment rates was never sold to the community and there were a lot of misunderstandings. Special City Council Meeting Minutes July 12, 2012 Page 3 of 5 Victor Muniz thought that the City would learn from the past Proposition 218 proceeding. He noted that the proposed decommissioning was an attempt to blackmail the community. Mr. Muniz stated that there were plenty of reserves to cover this shortfall, and pointed out that the contract should have been renegotiated sooner. He opposed a higher assessment and/or the use of a consultant and suggested that the City proceed with an alternative solution. John Lyons was opposed to paying for someone else's assessment district. He noted that the property owners decided to form his District as an alternative to a homeowner's association. Mr. Lyons stated that his District was well maintained and spoke of the benefit of landscape maintenance districts in the City. Priscilla Kanie recognized that her other expenses have gone up from 1993 to present. She didn't mind paying a little more. Last time, she was told that condominium owners would pay less and that schools were included, and wondered why the rules were different now. Also, $38 is a whole lot more than 2% per year. Ms. Kanie noted the importance of landscaping to the home's resale value and wondered why xeriscape was not being considered. Lastly, she noted that the level of service is low. Connie reported that the weeds are very high. She had downloaded RC to Go and had reported a broken sprinkler head, which had not been fixed yet. She agreed that Valley Crest was doing a better job but wanted a compromise and a better level of service. Clayton inquired about Option 2, noting the statements made earlier this evening that there are other actions that could be taken. He noted that the last Proposition 218 election was poorly written and misunderstood. He noted that a phased-in approach could work and wondered if alternative landscaping had been explored. Decommissioning the landscaping would impact the value of the homes. David Hill reported that there are several Eucalyptus trees hanging over his property that need to be trimmed. He reported them last year and was told that they shouldn't be trimmed. Yesterday, his wife was told that it was a budget problem. Mr. Hill noted that he could pay the increased assessment but wanted assurance that he would get better service. Lisa Thompson indicated that she lives in LMD No. 4-R. She indicated that people have been threatened with the suggestion to pull turf out and devalue people's property. The property owners in LMD No. 4-R have paid $400,000 to do a landscape renovation study and she noted that it was not legal to use this study for other Districts. The landscaping is improving in her District, but it is not"A" level. Mike Chavez stated that this meeting is similar to the last meeting that was held regarding LMD No. 2. Scare tactics are being used. Mr. Chavez noted the high personnel costs and wondered how many employees work in the District and if duties are shared between Districts. He was glad to pay the $38 but needed more information. For instance, has the City looked into consolidating duties/pay reductions, maybe the size of the large District should be reduced. There are a lot of overgrown weeds. Jeff Rogers noted that the amount of the assessment is not important; it's how it is being used. No one wants to see the grass die. He noted that he has been a voter since 1984 and has never voted for a tax increase. He wants to be sure that his money is being used appropriately. Mr. Rogers wondered how the District has survived since 1993 without a tax increase. He noted that he would probably support this increased assessment but wanted assurance that the money is being used in the most efficient way. A member of the public inquired about the definition of a statistically valid survey. Michael Travis noted that he walks in this District every day. There are broken sprinklers, etc. He offered to e-mail his suggestions. At the conclusion of the public communication period, Lori Sassoon, Deputy City Manager/Administrative Services thanked the speakers for their comments. She noted that a Proposition 218 election is not being held tonight. Rather than decommissioning, staff is recommending a different approach by recommending a community outreach process. Mrs. Sassoon addressed the questions raised by the speakers, as follows: Special City Council Meeting Minutes July 12, 2012 Page 4 of 5 Mrs. Sassoon discussed how a statistically valid survey would be conducted. She noted that the $38.00 referenced in the staff report was an estimate, as the services of a professional assessment engineer have not yet been acquired. There are Proposition 218 restrictions regarding how assessments are determined in order to ensure that each property pays its own fair share. Mrs. Sassoon recognized that $38.00 is more than 2% per year as the cost has risen over 2% overall. However, she noted that any proposed CPI increase could be capped at 2%. Past actions of the City Council have shown that only the monies needed to operate the District would be used. Regarding the suggestion to install xeriscape, Mrs. Sassoon stated that there would be substantial capital costs inherent in this option. She also noted that the Landscape Redesign Project that was funded by LMD No. 4-R is solely being used in LMD 4-R. Mrs. Sassoon noted that all of the LMDs are audited every year, and she would be happy to discuss this further if there are additional questions or concerns. Mrs. Sassoon addressed the maintenance concerns raised in by the audience. She recognized that there were challenges in LMD No. 2 and noted the need to live within the budget. She encouraged people who see a broken sprinkler, etc. to contact the City so it can be repaired. The City's ability to manage a District well is apparent in the other landscape maintenance districts throughout the City. Also addressed was the last increase to LMD No. 2 in 1993. Mrs. Sassoon noted that since that time, the District has received additional funds through new development in that area. However, the development in LMD No. 2 is static now. There is a need to address the structural deficit in that District. Bill Wittkopf, Public Works Services Director, apologized to Mr. Travis. He noted that there are two inspectors in the entire City and there is a limited number of staff available. Mr. Wittkopf noted that anyone seeing a problem in LMD No. 2 is welcome to call the Public Works Yard, or e-mail Rancho Responds. Mr. Wittkopf also addressed the staffing level in LMD No. 2, noting that some positions are charged exclusively to that District and others are shared throughout all the Districts. Staff logs this work so that all of the Districts are charged appropriately. Mr. Wittkopf noted that Spectrum Care is not out of business. They had approached the City indicating that they couldn't perform the work under the terms of the contract. Currently, LMD No. 2 is at a "B" level of service, and he noted that Valley Care is doing a good job. However, as they are new to the work and as this is a big District, Mr. Wittkopf would appreciate receiving information on any outstanding maintenance needs. Regarding the redesign of LMD No. 4, Mr. Wittkopf affirmed that this work was funded by and will be solely used in this District. He also noted that there are two certified arborists in the City, and promised to look at the Eucalyptus trees that need to be trimmed. John Gillison, City Manager, addressed the use of the reserves. He noted that each of these Districts stand alone. The City's General Fund reserve should not be used to help one LMD over another. Mr. Gillison noted that all of the reserves are kept separate and indicated that LMD No. 2 has a reserve of 2.3 million dollars. At least 50% of the budget needs to be in the reserves to fund ongoing costs. Also, there should be funds in the reserves to cover emergency or unplanned expenses. In response to Council Member Williams, Mr. Gillison addressed the Proposition 218 ballot language, noting that the language needs to be very specific as to the assessment amount being considered. In response to Mayor Michael, Mr. Gillison addressed the assessment amount. The $38 referenced in the staff report is an estimate as the City has not yet hired an assessment engineer to calculate the actual proposed assessments. In response to Mayor Michael, Mr. Gillison confirmed that staff could explore any viable options proposed during the community engagement process. Also discussed was the proposed formal survey to be done at the conclusion of the community engagement process as well as the City Council's role during the engagement process and the Proposition 218 process. Special City Council Meeting Minutes July 12, 2012 Page 5 of 5 Council Member Alexander suggested that the City Council refrain from making a decision until further discussions are held with the community. He didn't feel that the using a consultant to engage the community was needed. Council Member Buquet did not want to consider a Proposition 218 election at this time. He noted the need to make sure that we are getting the most out of our landscape maintenance contractor. Council Member Buquet suggested dividing LMD No. 2 into service areas. Also, he thought that an acre was too big for a pilot program. Rather, Council Member Buquet suggested that a xeriscape demonstration area be developed and noted the need to do a better job communicating with the property owners. Mayor Pro Tern Spagnolo pointed out that there is a limited number of people present at tonight's meeting. There is a need to communicate with all property owners. He supported the use of a consultant to engage the community as suggested by staff but did not support establishing a pilot project on a small piece of land. Mayor Michael assured the audience that the City Council was not interested in conducting another Proposition 218 election. He expressed the need to engage the community in the discussion and stressed the need for complete and accurate accounting in the District. Mr. Gillison indicated that staff had appropriate direction based on the consensus of the City Council to move forward with the community engagement process as outlined in the staff report. Council Member Buquet noted that these discussions should be coordinated with the Cucamonga Valley Water District and the Inland Empire Utility Agency. In conclusion, Mayor Michael thanked the audience members for attending the meeting and providing their comments. D. ADJOURNMENT Mayor Michael adjourned the meeting at 8:11 p.m. Res p tfully submitted, Debra I - Nay, MMC Assistant City Clerk/Records Manager Approved: August 1, 2012