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HomeMy WebLinkAbout01 - MinutesJune 13, 2017 Agenda Item No. 1 CITY OF NEWPORT BEACH City Council Minutes Special Joint Meeting with the Finance Committee May 23, 2017 I. CALL MEETING TO ORDER - 3:00 p.m. I. ROLL CALL Present: Council Member Jeff Herdman, Council Member Brad Avery, Council Member Diane Dixon, Council Member Scott Peotter, Council Member Will O'Neill, Mayor Pro Tem Duffy Duffield, Mayor Kevin Muldoon, Finance Committee Member William Collopy, Finance Committee Member Patti Gorczyca, Finance Committee Member Joseph Stapleton, Finance Committee Member Larry Tucker II. CURRENT BUSINESS A. Review of the City Manager's Fiscal Year 2017-18 Budget; Demonstration of New "Socrata" Financial Information Online Tool Council Member Dixon, Finance Committee Chair, introduced the Finance Committee Members. She stated the Finance Committee met four times to review the budget and financial details. She expressed her appreciation to the Finance Committee and staff. She encouraged caution in budget preparation and long term planning. �w -44W City Manager Kiff presented a PowerPoint presentation of the FY 2017-18 proposed budget highlights, General Fund sources and uses, and City Charter requirements. Deputy Finance Director Montano continued the PowerPoint presentation, summarizing General Fund revenues and assumptions. In response to Council Member Peotter's questions, Deputy Finance Director Montano stated the Transient Occupancy Tax (TOT) did not include the payment to Visit Newport Beach (VNB). City Manager Kiff stated Page R1 of the budget detail included the amount provided to the VNB. He noted the Tourism Business Improvement District (TBID) was not included in the budget because it was not a City entity. He reported the City collected a 2.5% administrative fee. Council Member Peotter requested the data be shown in the budget. Deputy Finance Director Montano continued reviewing assessed valuation growth, property tax revenues, and sales tax revenues. Finance Committee Member Collopy asked why the tax was less than the assessed valuation. Deputy Finance Director Montano explained it was a mechanism of Proposition 13, restricting the increase to no more than 2% per year. City Manager Kiff added that the property tax estimate was conservative. Council Member Peotter asked why the tax did not increase by the same amount as the valuation. City Manager Kiff reported that staff used the tax advisor's recommendations and a conservative estimate. Volume 63 - Page 278 City of Newport Beach Special Joint Meeting with the Finance Committee May 23, 2017 In response to Council Member Dixon's questions, City Manager Kiff stated it was necessary to watch decreasing property taxes. He reported property tax was also based on homes being flipped, Proposition 13, and new stock. Council Member Dixon stated it was important to consider build out. Deputy Finance Director Montano discussed the TOT and hotel bed tax revenue. City Manager Kiff presented the budget priorities, including fiscal sustainability, investing more in the Harbor, keeping Newport Beach special, and providing safety in the community. In response to Council Member O'Neill's questions, City Manager Kiff explained the difference between re -budgets and Capital Improvement Program (CIP) expenditures. He explained general government operating expenditures. Council Member O'Neill pointed out the $202.5 million in expenditures included the proposed discretionary pay down on pensions. City Manager Mff summarized General Fund expenditures by function. Council Member O'Neill pointed out the increase in spending of approximately $9 million due to pay down of pension liability. City Manager Kiff highlighted the changes in full-time positions, the full-time position trend, other staffing changes, part-time versus full-time positions, and efforts to minimize pension costs. He also discussed miscellaneous supplemental budget enhancements, the Fostering Interest in Nature (FIN) program, salaries and benefits, and typical non -safety employee pension costs. In response to Council Member Peotter's questions, City Manager Kiff explained that unfunded liability from PERS was at least 18 -months in arrears, the normal cost started to accommodate the actual experience of the unfunded liability, 70% of the unfunded liability was due to already retired employees. City Manager Kiff summarized the budgeted expenditures by department, General Fund expenditures by type, and Harbor and beaches capital funding sources. Finance Committee Member Collopy noted that budget expenditures by department were generally flat, but were contributing an additional $9.5 million toward the Unfunded Accrued Liability (UAL). Council Member Dixon stated the wages showed the additional payment into the unfunded liability. City Manager Kiff discussed funds set aside for investing in future needs and pension funding. In response to Council questions, City Manager Kiff confirmed that $50 million was going towards pension. He further explained the $25 million default pension UAL. Council Member Dixon noted the $34 million unfunded liability had increased from $2 million in 2007. City Manager Kiff discussed City Council Policy F-2 which established a contingency reserve of at least 25%. He proposed a modification to Policy F-2 to leave out the additional discretionary pension payment of $9 million. Council Member Peotter asked if it was excluded because it was voluntary and could be stopped at any time. City Manager Kiff confirmed the payments were made monthly and could be stopped at any time. City Manager Kiff discussed the change in unfunded liability over time. In response to Council Member O'Neill's questions, Deputy Finance Director Montano stated 2017 was intentionally omitted from the unfunded pension liability projection. However, City Manager Kiff stated he would modify the chart for clarity. Volume 63 - Page 279 City of Newport Beach Special Joint Meeting with the Finance Committee May 23, 2017 City Manager Mff presented a chart showing the phase-in of new amortization basis. Council Member Dixon explained that the level payment was similar to prepaying a mortgage. She discussed the transition to Public Employees' Pension Reform Action of 2013 (PEPRA) employees. City Manager Kiff stated the actuary advised the City on the matter to address the unfunded liability in 20 years. Council Member Peotter discussed the Finance Committee's charge to come up with a plan. He questioned whether $9 million is the right number and if Ca1PERS is the right investment strategy. City Manager Kiff stated the actuary had determined the unfunded liability could be addressed with an annual investment of $9.1 million. He discussed the possibility of a 115 Trust. Council Member Peotter noted Council should make the policy decision on the amount of the additional payment. City Manager Kiff indicated it was the City Manager's Proposed Budget. Council Member Dixon stated the level payment was discretionary each budget year. City Manager Kiff stated the goal was to have a 20 year level payment. Mayor Muldoon stated the City would be protected from escalating debt. He believed that the best thing for the City was to pay down its debt as quickly as possible. City Manager Kiff presented a comparison of UAL payment options and pension payment history. In response to Council Member Avery's question, City Manager Kiff anticipated only a handful of cities were making similar discretionary payments. He reported that the City had more retirees than current active employees at this time. Council Member O'Neill pointed out that South County cities are paying pension costs through the contract pass through. Deputy Finance Director Montano presented the long range financial forecast model. Council Member Dixon thanked staff for the model and Finance Committee Member Gorczyca for proposing the practice. She noted a slight adjustment of assumptions could change the deficit line. City Manager Kiff summarized the proposed budget. He discussed the Finance Committee consideration and next steps. He reported the budget documents were available online and thanked Finance staff and the Finance Committee. Committee Member Tucker stated unfunded liability was a complicated issue, reported the Finance Committee did not spend a lot of time on the capital budget because it was a policy decision for the City Council, discussed the $1 million proposed for the General Plan Update, and explained the unfunded pension liability and proposed $9.1 million level payment. Finance Committee Member Stapleton thanked the City Council for the opportunity to serve on the Finance Committee. He stated he was proud the City was fiscally conservative while providing quality of life and services for Newport Beach residents. He discussed the Finance Committee's consideration of the unfunded pension liability issue. Council Member Herdman commended the Finance Committee for its service. Council Member Peotter discussed the proposed $9.1 million additional payment to the unfunded pension liability. He emphasized the pension problem needed to be fixed by the Governor and State. Mayor Pro Tem Duffield thanked the Finance Committee for its work. He expressed appreciation to the attention and detail spent on the Harbor. Volume 63 - Page 280 City of Newport Beach Special Joint Meeting with the Finance Committee May 23, 2017 Denys Oberman encouraged the City Council to continue with a conservative approach and be good policymakers. She believed a 2% delta between surplus and deficiency was too narrow and the assumption on pension return was too aggressive. She encouraged the right mix of development uses. Jim Mosher stated hard copies of the budget were available for public inspection in the libraries. He discussed the expenses and ownership of the Balboa Island seawalls and revenue from auto sales tax, and asked about the financial information online tool (Socrata) and the Mariners Mile Revitalization project. Lee Pearl complimented the City Council on the budget. He requested a chart showing a ten-year trend on surplus versus deficit, and suggested setting up a $9 million reserve fund or trust for pension liability rather than releasing it directly to PERS. City Manager Mff stated a Socrata demonstration would be presented at the next meeting, discussed the 2% variance referenced by Ms. Oberman, and requested the City Council provide him with any checklist items. Mayor Pro Tem Duffield discussed the cost estimate to replace the entire bulkhead. He noted staff was proposing replacement of portions, which was significantly less expensive. Mayor Muldoon believed the Balboa Island seawall benefitted all residents and should not be paid for by just Balboa Island residents. Council Member Dixon thanked staff and the Finance Committee, and commended Council Member Peotter for recommending that the Finance Committee include public members. Council Member Avery requested that the Newport Heights Traffic Study be added to the checklist. III. PUBLIC COMMENTS Jim Mosher asked when the budget checklist would be available. IV. ADJOURNMENT - 4:30 p.m. The special meeting agenda was posted on the City's website and on the City Hall Electronic Bulletin Board located in the entrance of the City Council Chambers at 100 Civic Center Drive on May 18, 2017, at 4:00 p.m. City Clerk Mayor Volume 63 - Page 281 CITY OF NEWPORT BEACH City Council Minutes Study Session and Regular Meeting May 23, 2017 I. ROLL CALL - 4:45 p.m. Present: Council Member Jeff Herdman, Council Member Brad Avery, Council Member Diane Dixon, Council Member Scott Peotter, Council Member Will O'Neill, Mayor Pro Tem Duffy Duffield, Mayor Kevin Muldoon II. CURRENT BUSINESS SS1. Clarification of Items on the Consent Calendar - None SS2. Public Works Week Proclamation Public Works Director Webb expressed gratitude to the Public Works and Municipal Operations Departments. Mayor Muldoon read and presented the proclamation to Public Works Director Webb. Council Member Dixon commended the Public Works and Municipal Operations Departments. Mf -mv Council Member Avery thanked the Departments for their professionalism. Council Member Herdman discussed the value of the Public Works Department. SS3. Ocean Front Walk Regulations and Plans for Summer 2017 Deputy City Manager Finnigan presented a PowerPoint presentation, outlining the Ocean Front "Boardwalk," issues raised by the community, Newport Beach Municipal Code (NBMC) Section 12.54, other NBMC references, allowed uses, and conveyances not currently addressed including electric bikes (e -bikes), hover boards, Segway and future technology. City Traffic Engineer Brine continued the PowerPoint presentation, summarizing the pedestrian counts, speed survey, signage, possible solutions for Balboa Boulevard from E Street to G Street, andbicycle trail comparison. Deputy Police Chief Birch presented highlights of the Peninsula Enforcement Team and Boardwalk Ambassadors Program. In response to Council Member Dixon's question, Deputy Police Chief Birch explained that the Ambassadors provided community engagement and education. He discussed efforts for increased presence. Deputy City Manager Finnigan continued the PowerPoint presentation with the suggested path, including cleaning up NBMC 12.54 to specify allowable uses versus prohibited conveyances on the Boardwalk and working with business owners. In response to Council Member Dixon's questions, Deputy City Manager Finnigan discussed bike paths in other cities. Council Member Dixon noted she biked on the Boardwalk and believed there were too many signs. Volume 63 — Page 282 City of Newport Beach Study Session and Regular Meeting May 23, 2017 In response to Council Member O'Neill's question, City Attorney Harp stated exceptions would be required to meet Americans with Disabilities Act (ADA) regulations. Council Member Dixon suggested working with Segway rental companies to ensure basic rules of the road were followed. Deputy City Manager Finnigan discussed possible agreements with the Segway companies to ensure compliance with the rules. Council Member Herdman discussed positive results from when he was an administrator of informing students of what could be done rather than what was prohibited. He expressed concern with the proliferation of signs telling people what not to do on Balboa Island. Council Member Peotter asked if pedestrians could be separated from bicycles. Deputy City Manager Finnigan stated other cities utilized different lanes. City Traffic Engineer Brine stated there were differing opinions on bike lanes. Council Member Peotter asked if surreys could be outlawed. Deputy Police Chief Birch stated surreys were not outlawed, but could be regulated. Council Member Peotter recommended making surreys illegal in the bike lanes and on the Boardwalk. Fred Levine expressed concern with public safety and motorized vehicles on the Boardwalk. He suggested additional enforcement and invited the City Council to visit his home to view the issues. Buzz Lowrey believed the problem with Segway and surrey devices have subsided, but e -bike issues have increased. Maureen Cotton discussed the need for additional enforcement. She stated Assembly Bill 604 allowed prohibition of e -bikes on specific paths. She discussed concerns with the Pier to Pier group using electric vehicles and urged banning Class 1, 2 and 3 uses on the Boardwalk. Denys Oberman discussed the various types of motorized vehicles operating on the Boardwalk, all traveling more than 8 miles per hour. She expressed frustration regarding the rental of Segway devices. She encouraged restoring the Boardwalk to a safe place to walk. She concurred that there were too many signs. Joe Walkey discussed accidents on the Boardwalk. He suggested separating the bikes from the walkers. Jim Mosher reminded the City Council of the suggestion to deploy speed signs. David Merin believed surreys were dangerous on the Boardwalk, suggested banning them completely, questioned why skateboards were illegal, and believed enforcement would solve a lot of the problems. Ann Merin suggested only allowing bikes on the street rather than on the sidewalk while traveling to the Wedge. Robert Larner discussed the lack of understanding regarding the meaning of the signs. Council Member Dixon stated changes were necessary to deal with safety and speed issues. She indicated improvements for the E Street intersection were being considered and suggested installation of material or boulders to reduce bike speeds in Peninsula Point and the inclusion of the sharrows on the street. She agreed with working with the Segway rental owners to come up with a solution and recommended accelerating the study and potential lane markings at McFadden Square. She questioned whether motorized vehicles should be prohibited. She agreed that safety was the number one concern and indicated support for utilizing electronic speed signs. Volume 63 - Page 283 City of Newport Beach Study Session and Regular Meeting May 23, 2017 Council Member Herdman concurred with Council Member Dixon. City Manager Kiff requested the City Council straw vote on the various issues. The City Council took a straw vote on updating the NBMC to adhere to the California Vehicle Code (CVC) guidelines and Council Member Herdman, Council Member Avery, Council Member Dixon and Council Member Peotter were in support. The City Council took a straw vote on discussing tour agreements with Segway operators and Council Member O'Neill, Council Member Peotter, Council Member Dixon, Council Member Avery, Council Member Herdman, and Mayor Pro Tem Duffield indicated support. The City Council took a straw vote on flipping the NBMC to indicate what was allowed versus what was prohibited and Council Member Herdman, Council Member Avery, Council Member Dixon, and Mayor Pro Tem Duffield agreed. The City Council discussed the options for banning surreys and, upon straw vote, Council Member Herdman, Council Member Avery, Council Member Peotter and Council Member Dixon agreed to bring back options. The City Council took a straw vote on surrey land use restrictions on the Peninsula, with an amortization analysis, with Council Member Herdman, Council Member Avery, Council Member Dixon, and Mayor Pro Tem Duffield indicating support. Deputy Police Chief Birch explained the three classes of e -bikes. A straw vote was taken and Council Member Herdman, Council Member Avery, Council Member Dixon, and Mayor Pro Tem Duffield agreed to explore changes to e -bikes. Council Member Herdman believed surreys were very problematic on Balboa Island. Council Member Dixon requested recommendations come back for McFadden Square. City Manager Kiff stated it would be necessary to discuss options with the Public Works Department. Council Member Dixon suggested bringing back an inexpensive solution. City Manager Kiff stated he would work with Council Member Dixon. Mayor Pro Tem Duffield suggested increasing width where there is high congestion. The City Council unanimously agreed to consider increasing width in heavy traffic areas. III. PUBLIC COMMENTS Jim Mosher discussed the continued performance evaluation of the City Manager showing up on the Closed Session agenda. He expressed concern about the City Council's vote on April 11, 2017 regarding relocating the Ronald Regan Memorial Statue and lack of information on the agenda. He urged the City Council to review his letter and respond, otherwise he would be forced to sue the City. Mayor Muldoon stated the City Manager's evaluation had not yet been conducted due to time constraints. City Attorney Harp announced that the City Council would adjourn to Closed Session to discuss the items as listed in the Closed Session agenda and read the titles. IV. CLOSED SESSION - Council Chambers Conference Room Volume 63 - Page 284 City of Newport Beach Study Session and Regular Meeting May 23, 2017 A. CONFERENCE WITH LEGAL COUNSEL EXISTING LITIGATION (Government Code § 54956.9(d)(1)): 2 matters Paul Matheis v. City of Newport Beach Office of Administrative Hearings, Case No. 2016-070710 Paul Matheis v. City of Newport Beach Workers' Compensation Appeals Board Case No. ADJ7731364 B. CONFERENCE WITH LABOR NEGOTIATORS (Government Code § 54957.6) Agency Designated Representatives: Dave Kiff, City Manager, Carol Jacobs, Assistant City Manager, Barbara Salvini, Human Resources Director; Peter Brown, Esq., Negotiators. Employee Organizations: Association of Newport Beach Ocean Lifeguards (ANBOL) and Newport Beach Police Association (NBPA). B. PUBLIC EMPLOYEE PERFORMANCE EVALUATION (Government Code § 54957 (b)(1)) Title: Dave Kiff, City Manager V. RECESSED - 6:05 p.m. Y � VI. RECONVENED AT 7:04 P.M. FOR REGULAR MEETING VII. ROLL CALL Present: Council Member Jeff Herdman, Council Member Brad Avery, Council Member Diane Dixon, Council Member Scott Peotter, Council Member Will O'Neill, Mayor Pro Tem Duffy Duffield, Mayor Kevin Muldoon VIII. CLOSED SESSION REPORT City Attorney Harp reported that there were no reportable actions taken. IX. PLEDGE OF ALLEGIANCE - Mayor Muldoon X. INVOCATION - Madelon Maupin, First Church of Christ, Scientist XI. NOTICE TO THE PUBLIC XII. CITY COUNCIL ANNOUNCEMENTS (NON -DISCUSSION ITEM) Council Member O'Neill reported he attended the Bunnies and Book Festival, Field of Honor Event, Public Safety Day, Balboa Island Art Walk, Newport Coast Elementary School PTA Volunteer Awards Ceremony, Citizens Police Academy Graduation, and OASIS Senior Center Volunteer Fair. Council Member Dixon commented on the Field of Honor Event and congratulated the 41St Citizens Police Academy Graduates. She commended staff on its recognition by the Government Finance Financial Association on the City's Comprehensive Annual Financial Report (CAFR). Volume 63 - Page 285 City of Newport Beach Study Session and Regular Meeting May 23, 2017 Council Member Herdman stated he attended many of the events mentioned by Council Member O'Neill and Council Member Dixon. He thanked staff and the constituents that attended his District 5 Town Hall Meeting and discussed recent staff tours of the Balboa Island Museum. He also thanked the commodores and clubs for the invitations to opening days at the various yacht clubs. Council Member Avery discussed the Field of Honor Event and the recent visit of his niece and her family to the City. Mayor Pro Tem Duffield announced the Harbor Underwater Clean Up Event on June 3, 2017. Mayor Muldoon stated he also had the pleasure of attending the Field of Honor Event. He discussed the successful Public Safety Day Event and his attendance at the Art Walk. He announced the John Wayne Park Dedication on May 26, 2017 at 3:00 p.m. XIII. PUBLIC COMMENTS ON CONSENT CALENDAR Regarding Item S16 (Amendment to the JWA Settlement Agreement: Definition of Commuter Air Carrier or Commuter Carrier), Allen Beek, Secretary of SPON, stated SPON was not prepared to sign the proposed amendment to the settlement agreement due to the potential increase in the number of flights. City Manager Kiff stated he respected SPON's perspective, but it was not his opinion that flights would increase. He stated the County of Orange was obligated to adhere to agreements. He stated he was hopeful that SPON would approve the amendment. In response to Mayor Muldoon's questions, City Attorney Harp reported SPON was a party to the agreement. He stated the County would be considering the matter on June 6, 2017. He stated all four parties needed to approve the amendment. Mr. Beek indicated SPON had not yet decided on the amendment and needed time to review recently obtained information. Jim Mosher discussed the airline comments presented at the County Airport Commission meeting and the need for SPON to review the material and discussed City Council Policy A-17 requiring the settlement agreement to be heard by the Aviation Committee. Sue Dvorak discussed the effect of planes flying over her home. She expressed concern with the health impact from jet fuel and urged Council to correct the problem. Mayor Muldoon discussed litigation with the Federal Aviation Administration (FAA) and agreed that it was an important issue. He stated he was inclined to support Item S16 and await SPON's decision. XIV. CONSENT CALENDAR READING OF MINUTES AND ORDINANCES 1. Minutes for the May 9, 2017 City Council Meeting [100-2017] Waive reading of subject minutes, approve as amended, and order filed. 2. Reading of Ordinances Waive reading in full of all ordinances under consideration, and direct the City Clerk to read by title only. RESOLUTIONS FOR ADOPTION 4. Resolution of Intention to Renew the Corona del Mar Business Improvement District and Levy Assessments in Fiscal Year 2017-2018 [100-20171 Volume 63 - Page 286 City of Newport Beach Study Session and Regular Meeting May 23, 2017 a) Determine that the action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because it will not result in a physical change to the environment, directly or indirectly; b) Approve the Corona del Mar Business Improvement District's Fiscal Year 2016-2017 Annual Report and its Proposed Fiscal Year 2017-2018 Budget; and c) Adopt Resolution No. 2017-37, AResolution of the City Council of the City of Newport Beach, California, Declaring its Intention to Renew the Corona del Mar Business Improvement District and Levy Assessments for the Fiscal Year of July 1, 2017 to June 30, 2018, and Fix the Time and Place of a Public Hearing for June 13, 2017. 5. Resolution of Intention to Renew the Newport Beach Restaurant Association Business Improvement District and Levy Assessments in Fiscal Year 2017-2018 [100-2017] a) Determine that the action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because it will not result in a physical change to the environment, directly or indirectly; b) Approve the Newport Beach Restaurant Association Business Improvement District's Fiscal Year 2016-2017 Annual Report and its Proposed Fiscal Year 2017-2018 Budget; and c) Adopt Resolution No. 2017-38, AResolution of the City Council of the City of Newport Beach, California, Declaring its Intention to Renew the Newport Beach Restaurant Association Business Improvement District and Levy Assessments for the Fiscal Year of July 1, 2017 to June 30, 2018, and Fix the Time and Place of a Public Hearing for June 13, 2017. CONTRACTS AND AGREEMENTS_ 7. Approval of Amendment No. One to Professional Services Agreement with Everest International Consulting Inc. for Further Analysis Related to Federal Emergency Management Agency's Preliminary Flood Maps (C-8123-1) [38/100-2017] a) Find the execution of Amendment No One is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines; and b) Authorize the City Manager and City Clerk to execute Amendment No. One to the professional services agreement (C-8123-1) for $75,000, for a total contract amount of $160,000. Council Member O'Neill voted "no" on Item 7. 10. Agreement for the Purchase of a CNG 3 -Axle Dump Truck (C-8045-2) [38/100-2017] a) Determine this action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly; and b) Approve an agreement for the purchase of one CNG -powered 3 -Axle Dump Truck from Los Angeles Truck Centers, LLC DBA Los Angeles Freightliner for a total cost of $228,387.16, and authorize the Mayor and City Clerk to execute the agreement. S16. Amendment to the JWA Settlement Agreement: Definition of Commuter Air Carrier or Commuter Carrier (C-3424) [38/100-2017] a) Find that the execution of the Eleventh Supplemental Stipulation to the JWA Settlement Agreement is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because it will not result in a physical change to the environment, directly or indirectly; Volume 63 - Page 287 City of Newport Beach Study Session and Regular Meeting May 23, 2017 b) Find that the Eleventh Supplemental Stipulation to the JWA Settlement Agreement complies with City Council Policy A17; and c) Authorize the City Attorney to execute the Eleventh Supplemental Stipulation to the JWA Settlement Agreement on behalf of the City. MISCELLANEOUS 11. Pending Coastal Development Permit Waiver for De Minimis Development Located at 4151/2 29th Street (PA2017-048) [100-2017] a) Determine this action is not a project as defined exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action is to receive and file only and will not result in a physical change to the environment, directly or indirectly; and b) Receive and file. 12. Confirmation of Voting Delegate and Alternate for the 2017 League of California Cities Annual Conference - September 13, 2017 to September 15, 2017 1100-20171 a) Determine that the action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because it will not result in a physical change to the environment, directly or indirectly; b) Direct the City Clerk to complete and submit the LCC designation form by Friday, September 1, 2017; c) Designate Mayor Kevin Muldoon to be the Voting Delegate and Council Member Diane Dixon to be the Voting Delegate Alternate at the LCC Conference; and d) Authorize Mayor Kevin Muldoon and Council Member Diane Dixon to attend the LCC Annual Conference pursuant to Charter Section 402 and City Council Policy F-8 (City Travel Policy Statement), and to be reimbursed for their official traveling expenses. 13. Acceptance of Funds from Public Safety Realignment and the California Board of State and Community Corrections (BSCC) [100-20171 a) Determine that the action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because it will not result in a physical change to the environment, directly or indirectly; b) Accept AB 109 funds in the amount of $11,554.64 for front-line law enforcement services that were received and will post as Fiscal Year 2017-2018 revenues in Police Revenue account 01035352-431465 by increasing expenditure appropriations for Fiscal Year 2017-2018 in Patrol Overtime Safety and Half -Time account 01035353-713002; c) Accept BSCC funds in the amount of $57,088.09 for front-line law enforcement services that were received and will post as Fiscal Year 2017-2018 revenues in Police Revenue account 01035352-431465 by increasing expenditure appropriations for Fiscal Year 2017-2018 in Patrol Special Department Supplies BSCC account 01035353-841015-G1703 ($21,000.00) and Patrol Overtime Safety and Half -Time account 01035353-713002 ($36,088.09); and d) Authorize the City Manager to execute a budget amendment on July 1, 2017, to accept AB 109 and BSCC funds, increase revenue estimates by $68,642.73 in Police Revenue account 01035352-431465, and increase expenditure appropriations by $47,642.73 in Patrol Overtime account 01035353-713002 and $21,000.00 in Patrol Special Department Supplies BSCC account 01035353-841015-G1703 14. Set Public Hearing Date to Adopt Fiscal Year 2017-2018 Budget [100-2017] a) Determine this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly; and Volume 63 - Page 288 City of Newport Beach Study Session and Regular Meeting May 23, 2017 b) Schedule a public hearing of the City's Proposed Budget for Fiscal Year 2017-2018 on June 13, 2017, and direct the City Clerk to publish a notice of said hearing in accordance with Section 1102 of the Newport Beach Charter Motion by Mayor Pro Tem Duffield, seconded by Council Member Herdman, to approve the Consent Calendar, except for items removed (Items 3, 6, 8 and 9); and noting the recusal on Item 6 by Council Member O'Neill and the "no" vote on Item 7 by Council Member O'Neill. The motion carried by the following roll call vote: Ayes: Council Member Herdman, Council Member Avery, Council Member Dixon, Council Member Peotter, Council Member O'Neill, Mayor Pro Tem Duffield, Mayor Muldoon XV. ITEMS REMOVED FROM THE CONSENT CALENDAR 3. Medi -Cal Managed Care Rate Range Intergovernmental Transfer (IGT) Program (C-8085) [38/100-20171 Council Member Peotter expressed concern with paying $450,000 with the potential of getting back $600,000. Fire Administrative Manager Vasquez explained the requirement to submit matching funds due to the State's finite funds for Medi -Cal services. She stated the return was $.33 on the dollar. In response to Council Member Peotter's question, Fire Administrative Manager Vasquez stated there was no contractual written guarantee that the City will receive funds back. She explained the use of local funds to draw down Federal funds. City Manager Kiff stated the funds would only be used towards medical service. Fire Administrative Manager Vasquez discussed potential risks. Council Member O'Neill discussed the high cost of ambulance services and efforts to offset the difference. In response to Council Member Dixon's question, Fire Administrative Manager Vasquez stated the reimbursement rate was 8% which would increase to 17.5% with the program. Motion by Council Member O'Neill, seconded by Council Member Dixon, to a) determine this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly; b) adopt Resolution No. 2017-36, A Resolution of the City Council of the City of Newport Beach, California, Authorizing the City Manager, or Designee, to Execute Agreements with the Department of Health Care Services (DHCS) and CalOptima to Participate in the FY 2015-2016 and FY 2016-2017 Medi -Cal Rate Range Intergovernmental Transfer (IGT) Program; and c) authorize Finance Department staff to execute an administrative amendment to the FY 2018 budget to increase expenditure appropriations by $459,621 in the Medi -Cal IGT account 01040404-821008 and to increase revenue estimates by $612,828 in the Medi -Cal IGT account 01040404-431246 of the Fire Department. The motion carried by the following roll call vote: Ayes: Council Member Herdman, Council Member Avery, Council Member Dixon, Council Member O'Neill, Mayor Pro Tem Duffield, Mayor Muldoon Nays: Council Member Peotter 6. Median Landscape Turf Replacement - Award of Contract No. 8151-1 (16L02) [381100- 20171 Council Member O'Neill recused himself from this item due to real property interest. Volume 63 - Page 289 City of Newport Beach Study Session and Regular Meeting May 23, 2017 Council Member Peotter discussed prior discussions regarding turf replacement. He suggested continuing the item to direct staff to replace turf with drought tolerant ground cover. Council Member Dixon inquired about the proposed plans. Public Works Director Webb stated the plant pallet mimicked the recent installation at San Joaquin Hills. Motion by Council Member Peotter. seconded by Mayor Muldoon, to continue the item and give direction to staff to come back with a lower cost proposal alternative. Council Member Herdman suggested that staff consider the same ground cover also be used on Jamboree Road. The motion carried by the following roll call vote: Ayes: Council Member Herdman, Council Member Avery, Council Member Dixon, Council Member Peotter, Mayor Pro Tem Duffield, Mayor Muldoon Recused: Council Member O'Neill 8. Amendment No. One to Lease Agreement with Lighthouse Caf6, LLC, for the Restaurant Space at Marina Park Located at 1600 West Balboa Boulevard and a Waiver of City Council Policy B-13 (C-6075) [381100-20171 Council Member Dixon indicated support for the overall concept, but asked if the food cart provision could be removed from the agreement to consider impacts to surrounding businesses. City Manager Kiff suggested continuing the item so staff can negotiate the food cart provision. In response to Council Member Peotter's question, Community Development Director Brandt explained that the purpose of the food cart is to service visitors in the park. Council Member Dixon stated she had heard concerns from a local retailer and requested reevaluation of the food cart. Council Member O'Neill stated he would not recommend deleting the food cart. George Schroeder thanked Council Member Dixon for her consideration. He noted existing nearby locations for a quick bite and drink. He expressed concern with allowing the food cart. Jim Mosher explained the amendment to the lease agreement, including the food cart. He expressed concern with overconcentration of type 47 licenses and believed the City was adding to the problem. Motion by Council Member O'Neill, seconded by Council Member Dixon, to continue the item to the June 13, 2017 City Council meeting. The motion carried by the following roll call vote: Ayes: Council Member Herdman, Council Member Avery, Council Member Dixon, Council Member Peotter, Council Member O'Neill, Mayor Pro Tem Duffield, Mayor Muldoon 9. Airport Consulting - Contract with Tom Edwards (C-7071-2) [38/100-2017] In response to Mayor Muldoon's question, City Manager Kiff suggested amending the contract from 3 years to a one-year term. Volume 63 - Page 290 City of Newport Beach Study Session and Regular Meeting May 23, 2017 Motion by Mayor Muldoon, seconded by Council Member O'Neill, to a) determine this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly; and b) authorize the Mayor to sign the Professional Services Agreement with Thomas Cole Edwards, Inc., as amended with a one-year term. The motion carried by the following roll call vote: Ayes: Council Member Herdman, Council Member Avery, Council Member Dixon, Council Member Peotter, Council Member O'Neill, Mayor Pro Tem Duffield, Mayor Muldoon XVI. PUBLIC COMMENTS ON NON -AGENDA ITEMS Sue Dvorak addressed the City Council regarding retaining the dog beach. Tim Hamilton urged expansion of dog beach. He discussed the letter sent to the County by Council Member Dixon rejecting dog beach. He requested the letter be withdrawn and the "No Dogs" signs be removed and requested the City Council agendize the matter. Mike Glenn discussed the City Council's previous support of dog beach, the Parks, Beaches and Recreation Commission's direction to codify amenity for the community, and City Manager Kiff's statement regarding bringing the matter to the City Council for discussion. He requested the matter be considered by the City Council. Bryndon Golya, dog trainer, concurred with the prior speakers and indicated support for dog beach. Scott Hoffman encouraged the City Council to place dog beach on an agenda. Victor Leipzig, representing the Orange County Autobahn Society, thanked the City for meeting with representatives regarding the snowy plover habitat site near D and E Streets. He indicated opposition to allowing a dog beach at the mouth of the Santa Ana River. Angel Lee expressed support for dog beach. Phil Guston addressed the City Council in support of dog beach. Sharon Ray urged the City Council to listen to the young constituents and their desire for the dog beach. Laura Fayerman indicated support for dog beach. Dennis Bress discussed the need for a dog beach and expressed concern regarding Council Member Dixon's opposition to dog beach. Jenny Stogley addressed the City Council in support of dog beach. George Schroeder stated dogs were current allowed on the beach on leashes but believed the dog beach was not safe. He emphasized this was a County decision. Terry Kwam questioned why the matter was brought back by Council Member Dixon. She suggested resolving the matter in favor of dog beach. Lino Baratto indicated support of dog beach. Volume 63 - Page 291 City of Newport Beach Study Session and Regular Meeting May 23, 2017 Bruce Boyd stated there was no official dog beach area. He stated the area was an environmentally sensitive habitat area and a flood control zone. He expressed concern about misinformation. Lori Baratto indicated support for dog beach. She stated she thought it had already been decided. In response to Mayor Muldoon's request for an explanation, City Manager Kiff stated the County of Orange was proceeding with an ordinance to make it a legally designated off leash area, but the ordinance did not get a second reading due to environmental groups stating the Environmental Impact Report (EIR) was inadequate. He stated it was his understanding that the County had indefinitely tabled the matter. He explained City projects that recently impacted access to dog beach and the City law that required dogs on leashes on beaches. He also pointed out that the Coastal Commission had expressed concern that the City was not protecting the dunes areas. XVII. ORAL REPORTS FROM CITY COUNCIL ON COMMITTEE ACTIVITIES - None XVIII. PUBLIC HEARING 15. Community Development Block Grant - 2017-2018 Action Plan (continued from May 9, 2017) [100-20171 Principal Planner Campbell provided the staff report and indicated that a summary of the Section 108 loan was provided to the City Council. In response to Mayor Muldoon's question, Community Development Director Brandt stated the loan was refinanced from 6.5% to 1.5%. Mayor Muldoon opened the public hearing. Hearing no testimony, he closed the public hearing. Motion by Mayor Muldoon, seconded by Council Member Peotter, to a) find the approval of 2017-2018 Action Plan exempt from the National Environmental Policy Act (NEPA) pursuant to 24 CFR Part 58, Section 58.34; b) find the approval of 2017-2018 Action Plan exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15301 (Existing Facilities) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential to have a significant effect on the environment; c) adopt Resolution No. 2017-35, A Resolution of the City Council of the City of Newport Beach, California, Approving the 2017-2018 Action Plan for the Allocation of the Federal Community Development Block Grant for the 2017- 2018 Fiscal Year; and d) authorize the City Manager to (1) adjust appropriations to specific programs and projects as necessary to conform with the final 2017-2018 formula grant allocation of CDBG funds from HUD; (2) submit the 2017-2018 Action Plan to HUD; (3) execute the 2017- 2018 CDBG Program Grant Agreement and all related documents on behalf of the City; (4) execute subrecipient agreements with the nonprofit organizations receiving allocations of CDBG funds in the Action Plan; (5) authorize the Community Development Director, or his/her designee, to be the official representative of the City of Newport Beach to submit required environmental documentation for CDBG projects; and (6) make all necessary adjustments to the City -adopted budget to reflect funding allocations of the 2017-2018 Action Plan. The motion carried by the following roll call vote: Ayes: Council Member Peotter, Council Member Herdman, Council Member Avery, Council Member Dixon, Council Member O'Neill, Mayor Pro Tem Duffield, Mayor Muldoon XIX. MOTION FOR RECONSIDERATION - None Volume 63 - Page 292 City of Newport Beach Study Session and Regular Meeting May 23, 2017 XX. ADJOURNMENT - 8:42 p.m. The agenda was posted on the City's website and on the City Hall Electronic Bulletin Board located in the entrance of the City Council Chambers at 100 Civic Center Drive on May 18, 2017, at 4:00 p.m. The amended agenda was posted on the City's website and on the City Hall Electronic Bulletin Board located in the entrance of the City Council Chambers at 100 Civic Center Drive on May 19, 2017, at 9:00 a.m. City Clerk Mayor Volume 63 - Page 293