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HomeMy WebLinkAboutcc min 1972/09/06 MINUTES OF AN ADJOURNED REGULAR MEETING OF THE CITY COUNCIL OF CHULA VISTA, CALIFORNIA Held Wednesday September 6, 1972 An adjourned regular meeting of the City Council was held on the above date beginning at 3:30 p.m. in the Council Conference Room, Civic Center, 276 Fourth Avenue, with the following Councilmen present: Councilmen Scott, Hobel, Hamilton, Hyde Absent: Councilman Egdahl Also present: City ~anager Thomson, City Attorney Lindberg, Acting Finance Director Hackett VISITORS AND CONVENTION BUREAU Mr. Clint ~4athews, President, read a letter to the Council in which he stated that in December, 1971, the Executive Committee be- came aware of past-due bills. The account- ing showed $7,624.15 in arrears. The reason being that the operation of the Visitors Center increased in cost to the point that bills were not being paid. Corrective actions were taken by cancelling advertising, renego- tiating the land loan and initiating a membership drive. City funds Mr. Mathews commented that these measures met with failure and the debts increased; however, this was not realized "due to subterfuge." The City funds which were solicited on the basis that they were matching funds paid by the Bureau, were not used for the purpose solicited. Mr. Mathews claimed these actions were taken without the knowledge of the Executive Committee or the Board of Directors. Alternatives to pay off debts Alternatives open to the Board of Directors to satisfy and clear all debts were listed as follows: 1. Request help from the City Council to continue the Visitors Bureau; 2.Sell the Visitors Bureau property to the City and lease it back; 3. Have the City Council recognize the Center as a service, and meet it on a matching basis, increasing the City's contribution; 4. Sell the Visitors Bureau property to any individual or to one of the Mexican insurance companies; 5. Obtain a second trust deed on the property in the amount of $10,000; 6. Ask the City to increase the monthly contributions and perhaps get a loan of some type to help pay off present obligations. Clarification of City's funds In answer to Councilman Scott's query, City Manager Thomson explained that the Execu- tive Manager would present a statement or letter to the Finance Director indicating the checks written by the Bureau in order to obtain the matching funds from the City. Mr. Harvey Bernens remarked that the checks written to various organizations presented as evidence to obtain matching funds were not cashed, but later voided; this amounted to $4,415.34 of City funds. Amount in arrears Mr. Neil Haas reviewed the financial state- ment of the Bureau, as presented by Mr. Mathews: Amount past due as of December 31, $ 7,624.15 1971 120-day notes due January 1, 1973 1,500.00 (these were made by three business- men to keep the Center going) Past due accounts as of September 1, 12,354.26 1972 Accounts payable in future 30,259.52 Mr. Haas declared that the Board of Directors has cut down every possible expenditure and can operate the Center at a cost of $1,285.65 a month, or $15,427.80 a year. Reason for lack of accounting In answer to the Council's questions, Mr. Mathews commented that the Executive Manager was undergoing many personal problems during the last couple of years, which ended in a divorce and separation of her two children. The problems were just too much for her to cope with rationally and handle the Center's financial problems. Mr. Bernens remarked that there is no indi- cation of any embezzlement or wrong-doing. Council discussion Discussion followed as to the amount needed for operating expenses, cash on hand, and future accounts receivable. City help Councilman Scott indicated he could see no way that the City could advance the Bureau any substantial amount of money ($25,000) at this time, since the City is working on an extremely tight budget. There is a cash flow problem with no surpluses at this time. City Manager Thomson confirmed this, adding that this problem will exist until after the property taxes come in. Statements needed Councilman Scott stated he would want to see a Balance Sheet and projected Profit and Loss statement of what the Bureau needs for next year. He would then like to see the Bureau get together with the City Manager to come up with alternatives to present to the Council. City assistance in accounting Mr. Haas reported that the matter has been turned over to a Mr. Yeomans who is setting up a set of books for the Bureau; however, they have no funds to hire a Certified publiq Accoun~afitt6 m~ke ~a~t. Mr. Haas asked if the City could assist the Bureau in this accounting procedure. Mr. Thomson asked the Council to direct the Manager to work on this, as he has some sources in the City whereby he can get this assistance. - 2 - City Manager's Comments Mr. Thomson commented that the next City's payment to ~e Bureau is due in October. He added that there are two items in the Executive Manager's report that he will have to turn over to another City department: check numbers were submitted as being paid to other sources in order to get City funds, but were, in fact, not paid but used as a rationale to obtain City funds. Motion for statements It was moved by Councilman Scott and seconded and loan by Councilman Hobel that the Chula Vista Tourist and Convention Bureau present a Balance Sheet and a projected Profit and Loss Statement, projected to the end of the fiscal year. After that information is given, the Bureau representatives are to get together with the City ;4anager and the Manager will provide the Council with alter- natives. In the interim, the City will provide the Tourist and Convention Bureau $7,500.00 as an interest-free 60-day note. Discussion of motion Councilman Hobel questioned the 60-day time limitation, and suggested this be changed to 90 days. Motion changed Councilman Scott agreed to the 90 days. Mayor Hamilton asked the Bureau to initiate action immediately to draw up a set of by- laws to include proper accounting of expendi- tures and income so that they will be aware, at all times, of their financial standing. Motion carries The motion carried by the following vote, to-wit: AYES: Councilmen Scott, Hobel, Hamilton, Hyde Noes: None Absent: Councilman Egdahl Motion regarding CPA City Manager Thomson noted that the agree- ment calls for a Certified Public Accountant to make the audit. It was moved by Councilman Scott, seconded by Councilman Hobel and unanimously carried that because of the uniqueness of the situa- tion, for this time only, the requirement for the Certified Public Accountant to make the audit should be waived. Richard Kau, President Mr. Kau remarked that the Chamber of Commerce Chamber of Commerce and the firm of Creaser and Price, of which he is associated, will do what they can to help the Tourist Bureau. EXECUTIVE SESSION Councilman Scott noted that the Council will meet in Executive Session tomorrow night, September 7, to make appointments to Boards and Commissions. It was moved by Councilman Scott, seconded by Councilman Hobel and unanimously carried that the Council meet in an Executive Session beginning at 6:45 p.m. for litigation purposes, as requested by the City Attorney. COMMUNITY RECOGNITION AWARDS A discussion was held as to the awards to be presented at the October 13, 1972 banquet. Motion for awards It was moved by Councilman Hyde, seconded by Councilman Hobel and unanimously carried that a tile plaque and a pin be presented to each recipient. Hotion for Executive Session It was moved by Councilman Hyde, seconded by Councilman Scott and unanimously carried that the Council submit names for the recognition awards by September 15, and that on September 20, 1972, the Council recess to Executive Session for personnel matters to make the selections. The City Clerk was directed to order the tile plaques and pins. ADJOURNMENT Mayor Hamilton adjourned the meeting at 5:15 p.m. to the Executive Session scheduled for ThurSday, September 7, 1972, at 6:45 p.m. City Clerk - 4 -