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HomeMy WebLinkAboutcc min 2007/03/01 MINUTES OF AN ADJOURNED REGULAR MEETING OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA March I, 2007 6:00 P.M. An Adjourned Regular Meeting of the City Council of the City of Chula Vista was called to order at 6:01 p.m. in the John Lippitt Public Works Operations Center, located at 1800 Maxwell Road, Chula Vista, California. ROLL CALL: PRESENT: Councilmembers: Castaneda (arrived at 6:10 p.m.), McCann, Ramirez, Rindone, and Mayor Cox ABSENT: Councilmembers: None ALSO PRESENT: Interim City Manager Thomson, City Attorney Moore, City Clerk Bigelow, and Senior Deputy City Clerk Peoples PLEDGE OF ALLEGIANCE TO THE FLAG AND MOMENT OF SILENCE I. BUDGET WORKSHOP PUBLIC COMMENTS There were none. I. BUDGET WORKSHOP . Introduction Interim City Manager Thomson provided an overview of the budget workshop agenda, stating that this was the first of several meetings to be held prior to the adoption of the budget in mid- June. Steve Miller, representing the Firefighters Union, expressed dissatisfaction with a recent press release on the Fiscal Year 2006-2007 Second Quarter Report that focused on firefighter overtime. Interim City Manager Thomson stated that a lengthy report on the fire department overtime was included for discussion at next weeks Council meeting wherein the issues of under- funding the overtime budget will be addressed. . Fiscal Year 2006 - 2007 Second Quarter Report Finance Director Kachadoorian provided an overview of the second quarter report including the projected revenue shortfall based on tax revenues (net), development revenues and other departmental revenues, along with the action plan based on contingency plan savings and management vacant positions. Ms. Kachadoorian also provided an overview of the projected general fund available balance. BUDGET WORKSHOP (continued) Steve Miller, representing the Firefighters Union, addressed the Council on the Fiscal Year 2007-2008 Budget, stating that the Fire Department had developed a strategic plan a few years ago that had been accepted by the City Council, as well as a Facility Master Plan which cost $120,000 to prepare, neither of which called for budget cuts, and expressed stern opposition to budget cuts in the Fire Department. Kevin O'Neill, Chula Vista resident, spoke regarding the impact of staffing cuts to planning and building services, positions that are primarily self-funded by fees, which he felt if implemented, would increase the processing time and project costs to developers. Mr. O'Neill additionally cautioned the Council against making any cuts in the Fire Department that would effect the Fire Marshall position, which in his view required additional staffing. He then urged the Council to add one or two additional inspectors, whose fees could be partially recouped from application or business license fees. Mayor Cox stated that a letter had been received by the City Council from Mr. Steve Wood regarding problems with the storm drain system that gathers runoff from a portion of East 1 Street (from Penelope Drive to Hilltop Drive), as well as Carla Avenue and Belinda Way, and asking on behalf of himself and his neighbors, that the Council include CIP 135 in the budget for the upcoming fiscal year. Budget and Operations Director VanEenoo provided an overview of the fiscal policies established by the Council. Finance Director Kachadoorian provided two additional fiscal policies, which would be brought before the City Council for approval. The first was an update to the debt service policy, and the second a new worker's compensationlgeneralliability reserve policy, both intended for the long- term financial planning process. · Fiscal Year 2007 - 2008 Budget Update Budget and Operations Director VanEenoo provided an overview of the Fiscal Year 2007-2008 General Fund Base Budget starting with the Fiscal Year 2006-2007 Amended Budget of $170.9 million, highlighting projected increases such as the personnel costs per the Memorandum of Understanding (MOU), and decreases such as budgeted salary savings, resulting in the Fiscal Year 2007-2008 Base Budget of $178 million. Deputy Mayor Rindone requested the format of the visual presentation be changed so that negatives figures have parentheses around them and positives do not, rather than up and down arrows. Mayor Cox inquired and Finance Director Kachadoorian explained that the transfer of the RDA debt to the RDA, is actually a debt that the City issued in 1993 for the parking structure for the Chula Vista Shopping Center which is booked as a loan to the RDA every year. Instead of having to book the figure annually, and accrue interest, it is being moved to the RDA as debt which results in the reduction of RDA staff reimbursement being taken from the General Fund. Mayor Cox then inquired, and Director Van Eenoo responded that in 2006-2007 there was $1.4 million budgeted for fleet equipment. In Fiscal Year 2007-2008 staff is saying there needs to be a total of $1.9 million, and thus there is a $500 increase in the fleet equipment budget over what is currently there. Page 2 - Council Agenda httn:/ /www.chulavistaca.(!QV March 1, 2007 BUDGET WORKSHOP (continued) Councilmember McCann explained his understanding of the Fire Department overtime budget and use of projected overtime costs. Budget and Operations Director Van Eenoo stated that proposed changes to this practice would be addressed at next Tuesday's Council meeting. Director VanEenoo then provided an overview of the budget trends for the last six fiscal years, 2001-2002 through 2007-2008, stating that they were largely related to personnel costs such as Memorandum of Understanding (MOU) increases, health premiums and PERS costs. Additionally, he stated that the personnel services have increased from 72.3% to 81.4% of the General Fund budget since Fiscal Year 2001-2002. Deputy Mayor Rindone asked staff to provide the population increase from 2000 to 2007 for next Tuesday's meeting, as well as a comparison of staffing levels per 1000 population with other Cities similar to Chula Vista. Director VanEenoo then provided graphics depicting the growth in personnel services and the impact on the General Fund; the General Fund Revenues for Fiscal Year 2007-2008; Revenue Trends (Discretionary vs. Program Revenue), and the Projected Fiscal Year 2007-2008 Budget Gap which, with staffs assistance, had been reduced from a projection of $10.1 million to $6.3 million. Mayor Cox clarified that the difference in the projected budget gap from $10.1 million to $6.3 million was not a result of cuts, but merely the difference in expected and actual revenues at this point. Councilmember Castaneda noted that the figures projected did not leave much room for mid- year allocations, and then inquired as to how much the City Council had been asked to allocate outside of the budget process in the few past years. Finance Director Kachadoorian responded that the average was $5 million per year. Councilmemer Castaneda then stated he felt it safe to say that staff and Council would be self-imposing a moritorium on mid-year budget increases. Councilmember Ramirez inquired, and Finance Director Kachadoorian explained, that the mid- year budget requests were sometimes brought forward with grant offsets and new revenues to cover the additional funding costs. Budget and Analysis Director VanEenoo stated that should a mid-year budget request be brought forward, the fiscal impact section, for example, would include that the appropriations would be offset by grant revenues or unexpected higher sales tax revenues or if not, it would say money is being requested to be appropriated from reserves, which would lower the reserves. Councilmember Ramirez then received clarification that the $6.3 million gap assumes no change to reserves. . 5-Year Revenue and Expenditure Forecast Report Finance Director Kachadoorian provided an overview of the projected sales tax growth from Fiscal Year 2000 to Fiscal Year 2013, stating that she was projecting a 16% increase this year. Councilmember McCann made inquiry regarding the 16% projection. Director Kachadoorian responded that Fiscal Year 2006 had close to 14% sales tax growth, and this year, with the auto park up and running, the shopping mall open to the east, and the new crossings shopping center, she did not feel that an increase to 16% was an unrealistic assumption. Page 3 - Council Minutes http://www .chulavistaca.gov March I, 2007 BUDGET WORKSHOP (continued) Councilmember McCann requested Council be provided with the amount of sales tax growth during the last recession in the 1990's. Finance Director Kachadoorian then provided the five-year forecast including the sales tax per capita, growth in assessed value, debt service, projected deficit/surplus summary, general fund reserves projected to Fiscal Year 2013, and transient occupancy tax revenue per capita. Councilmember McCann made inquiry on the reflected growth in assessed value, and Finance Director Kachadoorian responded that it included both residential and commercial, and even though the market might be flat, the City could still see an increase in assessed values due to Prop 13 turnovers. Finance Director Kachadoorian then provided a demonstration of newly acquired software called MuniCast, which was purchased to assist staff in the provision of fiscal models that can depict long-term fiscal impacts, and has the capability of comparing the City of Chula Vista to other agencies of similar size. Budget and Operations Director VanEenoo provided the next steps in the budget process and requested Council consideration to hold the next budget workshop on Wednesday, April 18, 2007 wherein staff will come back with a more detailed plan, and proposed recommendations to close the current budgetary gap. ACTION: Mayor Cox announced that hearing no objection, the second Council Budget Workshop would be held on Wednesday, April 18, 2007 at 6:00 p.m. . Fiscal Year 2006 - 2007 Councilmember Block Budgets Budget and Operations Director VanEenoo presented the block budgets for Councilmembers, stating that staff had developed a proposed reallocation of the remaining Fiscal Year 2006-2007 Council Services and Supplies budget based on input from the Council Budget Subcommittee of Mayor Cox and Councilmember McCann. Director VanEenoo stated that initially, the Mayor and Council budget were contained in one lump sum, and recently, the personnel costs had been separated out to reflect the Mayor and all support staff in an Administrative key, and each Councilmember has an individual budget. One proposed change is to provide an Organizational key for the Mayor. This would result in an Administrative/Contingencies function for overall Mayor/Council Department items, a budget for the Mayor, and a budget for the individual Councilmembers. The Subcommittee recommended that the Administrative portion of the Services & Supplies budget be retained as one account, and the remainder of the funding is recommended be divided into block budgets with the Mayor to receive 30% of the remaining funds as a full time position, and the Councilmembers to each receive 15%, with the 10% remaining to be placed in the Mayor/Council Administrative/Contingencies budget. Mayor Cox clarified that the Subcommittee considered only Sservice and Supplies and left Personnel out until 2007-2008. She additionally noted that each column of the proposed Council block budget, allowed for flexibility in use by shifting the money to where it was most needed by the individual Councilmember. This would be a trial for the balance of the fiscal year and would be reviewed for Fiscal Year 2007-2008. Councilmember McCann spoke in support of the proposal stating that it allowed everyone to use their budget to customize their needs. Page 4 - Council Agenda htto:llwww.chulavistaca."OV March 1, 2007 BUDGET WORKSHOP (continued) Deputy Mayor Rindone inquired as to whether savings came from savings in the Mayor's staff budget. Mayor Cox responded it had not, and that staff was completely left out and there was no proposal at this time, considered for additional personnel costs. Deputy Mayor Rindone requested clarification, and Mayor Cox responded, that the total budget for each Councilmember of $6,443 for the remainder of the fiscal year was firm, however there was flexibility in the 10% of the Mayor/Council Administrative/Contingencies budget that could be reviewed for a contingency to an individual Councilmember for the balance of the year. Councilmember Castaneda made inquiry regarding the $500 that the Mayor and Council used to receive which was now included in the budget. Mayor Cox responded that it was now receipted, meaning that an invoice was required and would be reimbursed by the individual Councilmembers budget. ACTION: Mayor Cox moved to accept the recommendations of the Council Budget Subcommittee for the 2006-2007 Councilmember Block Budgets. Councilmember McCann seconded the motion, and it carried 4-1 with Deputy Mayor Rindone opposed. ADJOURNMENT At 7:39 p.m. Mayor Cox adjourned the meeting to the Regular Meeting on March 6, 2007 at 4:00 p.m. in the Council Chambers. ~ ::tu~-::;;;$.'l ~ Susan Bigelow, MMC, Cfty Clerk Page 5 - Council Minutes http://www .chulavistaca.gov March 1, 2007