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HomeMy WebLinkAbout05/09/2000 - Study Session0 CITY OF NEWPORT BEACH City Council Minutes Study Session May 9, 2000 - 4:00 p.m. INDEX ROLL CALL Present: Glover, Adams, Debay, Ridgeway, Thomson, Mayor Noyes Absent: O'Neil (excused) CURRENT BUSINESS 1. CLARIFICATION OF ITEMS ON THE CONSENT CALENDAR. In reference to Item #13, Annexation of Bay Knolls Area, Council Member Glover confirmed with City Manager Bludau that each annexation area would be handled separately. City Manager Bludau stated that the application would include all three areas together, however. He stated that the information is going through the Planning Commission separately and that it's also the way the consultant has been providing it. Council Member Glover suggested that the possibility of annexing Santa Ana Country Club might also be discussed by the City Council, since there is a group that is • seeking to have it annexed. City Manager Bludau stated that this would only be included if West Santa Ana Heights were to be considered for annexation. City Manager Bludau stated that the City would be meeting with the City of Costa Mesa in the near future to discuss this possibility. Council Member Glover encouraged the meetings to be held publicly. Council Member Debay referred to the staff report for Item #13 and the indication that the Bay Knolls area would be severed from the Newport Coast/Ridge annexation process. City Manager Bludau confirmed that the application with the Local Agency Formation Commission ( LAFCO) would include all three areas. He added that the decision to include West Santa Ana Heights would have to be determined prior to LAFCO taking any action. Mayor Pro Tem Adams referred to Item #11, Bonita Canyon Sports Park, and asked if the amount of $42,000 for unforeseen work was a sufficient amount or if a contingency would come from somewhere else. Public Works Director Webb stated that if there were significant change orders, next year's budgeted funds would have to be used. He added that there are funds being budgeted for several park fund elements in the 2000 -2001 budget, which could be looked at if the need arises but nothing has been specifically budgeted for the Bonita Canyon Sports Park. Council Member Debay asked if money is being earmarked for the CalTrans West parcel. Director Webb confirmed that enough money is being budgeted to put down a 10% deposit. • Council Member Debay requested that the missing information for Item #19, Economic Analysis of Proposals for Future Use/Development of Marinapark, Volume 53 - Page 326 City of Newport Beach Study Session Minutes May 9, 2000 • be provided at the evening meeting, referring to the first page of the staff report. Council Member Ridgeway asked if O Hill Partnership had signed the agreement in Item #10, Approval of Subdivision Agreement for Corporate Plaza West. Director Webb stated that he would find out and make sure that the agreement is properly signed before being finished. Council Member Ridgeway additionally asked if 36 months was the normal period to allow for the completion of such improvements. Director Webb responded that the period is usually between 24 and 48 months, depending upon the length of the project. Council Member Ridgeway pointed out that, in this case, the project is already complete and asked if 24 months could be considered. Director Webb stated that some improvements between the two buildings have not been done. Council Member Ridgeway stated that the obligation for Resubdivision 1006 is The Irvine Company's only. Director Webb said he would get more information, but believes that it is a joint responsibility of both parties. Council Member Debay asked for clarification on the boundaries of the resubdivision as indicated in the parcel map in the staff report. Director Webb stated that Parcel 3 is under the control of The Irvine Company and Parcel 1 is under the control of O Hill Partnership. He said that the uncompleted work is the street between the two parcels. He added that the requirements are to improve the circulation in the area and that the street is • private. Council Member Ridgeway added that O Hill Partnership is giving up one acre of property to Parcel 3 for The Irvine Company. 2. PARKING METER FEE INCREASE. Transportation & Development Manager Edmonston stated that the staff report was a follow -up to items that had been before the City Council at previous meetings. He stated that the Promote Revitalization of the Peninsula Committee (PROP) made recommendations to the City Council at its meeting of February 8, 2000, with the parking meter fee increase being recommended for immediate implementation. Manager Edmonston referred to the map in the staff report showing the current fees in three zones on the Peninsula and in the Mariners' Mile area. He outlined the recommended increases to these fees. He stated that if the City Council chooses to move forward with the fee increases, staff would prepare the necessary resolution and ordinance to implement the changes. Mayor Pro Tem Adams asked if any changes were being proposed, or if any were expected, for master parking permits. Manager Edmonston stated that the fee for master parking permits would not change. He added that, although the committees previously available for off- street parking discussions have been disbanded, staff receives only about one call per ® month and that they're primarily for more permit -type parking in the Cannery Village area and around City Hall. Manager Edmonston explained that the two permits that are the most used Volume 53 - Page 327 INDEX Parking Meter Fee Increase (85) City of Newport Beach Study Session Minutes May 9, 2000 ® are the annual permit, which costs $100, and the master permit, which costs $450. He stated that the annual permit allows the user to park at blue meters or in the Corona del Mar beach and Balboa Pier lots. He stated that the master permit allows the user to park anywhere in the City. Mayor Pro Tem Adams stated that since the recommended parking meter fee increase is 100 %, he was trying to determine if staff expected a change in the demand for the master permit. City Manager Bludau suggested that a review of the total permits sold could be performed in a year to determine if the demand did change as a result of the fee increase. Manager Edmonston confirmed for Mayor Pro Tem Adams that the recommended fee increase did not include a proposal to change the time restrictions at any of the meters. Council Member Ridgeway noted that since PROP supports the recommended action, he would be in support of it also. He additionally noted that the Cannery Village area would be experiencing many changes within the next six months, and he suggested that the parking issue be addressed in conjunction with those changes. Council Member Debay agreed with the recommendation to increase the meter fees, since out -of -town visitors primarily pay them. She added, however, that since local residents generally purchase the permits, she would not support a rate increase for them. She requested that staff determine if there might be a need to increase the number of blue meters. ® Manager Edmonston confirmed that the blue meters were originally installed to accommodate the local businesses and residents. He stated that the master permit was later created by the Off - Street Parking Committee. He added that the sale of the annual permit was monitored one year and it was found that approximately two - thirds were purchased by residents and about one -third by business employees who lived out -of -town. Council Member Thomson asked about the earlier reference to the Corona del Mar beach lot. Manager Edmonston explained that the annual permit is good at the beach lots and most of the City's off- street lots. Council Member Debay asked about the beach lots in the West Newport area. Manager Edmonston explained that the West Newport meters are already $1.00 per hour since they are primarily for beach use, and that about half of them are blue meters. Council Member Thomson stated that the City had previously looked at the concept of having a kiosk for payment of parking rather than the use of individual meters. Manager Edmonston confirmed that the City had met with a couple of vendors and contacted cities that were using the system. He stated that the reports were not extremely positive, but that the system has continued to improve. He stated that the City will again consider the use of the kiosk system when looking at the lot that will be expanded as a part of the redevelopment of downtown Balboa. ® Manager Edmonston stated that the fee increases, if approved, would leave only a few meters in the City at the $0.25 per hour rate. He said these include the meters along Coast Highway from Tustin Avenue to West Volume 53 - Page 328 INDEX City of Newport Beach Study Session Minutes May 9, 2000 Newport, and the meters in the Mariners' Mile lot. He added that these meters are not used frequently, so were not included in the proposal. Council Member Ridgeway noted that the City Council would be looking at an agreement during the evening meeting to convert 50 meters to electronic meters for a trial period of ninety days. He stated his eagerness in receiving the report that will follow the trial period. Manager Edmonston added that the meters will be enhanced electronic meters, and that the City already has some electronic meters. Manager Edmonston confirmed with the Mayor that staff is being directed to prepare a report with a resolution and ordinance for consideration at the City Council meeting of May 23, 2000. 3. FISCAL YEAR 2000 -2001 BUDGET OVERVIEW. City Manager Bludau stated that he planned for the overview at the current meeting to take approximately one hour. He added that the two Study Sessions in June would be entirely dedicated to discussing the budget. He stated that the overview at the current meeting would give a broad look at the framework for the budget and some of the background information. City Manager Bludau began his slide presentation with a graph illustrating total City revenues by source. He said that it is anticipated that the total ® City revenues for the 2000 -2001 fiscal year will be $124.3 million. He pointed out that the major revenues are property tax, and sales and other taxes. City Manager Bludau then presented a slide that illustrated general fund revenues by source. He stated that the information clearly shows how dependent the City is on sales and property taxes. He outlined the unique features to the City as being no trash collection fee and no utility user tax. He added, however, that the City does have high property tax values and a high property tax base. He confirmed with Administrative Services Director Danner that approximately 20% of the properties in the City are being assessed at pre - Proposition 13 values. Council Member Ridgeway stated that it is closer to 25% and the second highest in the State. City Manager Bludau presented a slide showing how the locally generated sales tax is allocated in the City, with approximately 78% of it going to the State General Fund. He stated that the City receives approximately 13% of the total, which is estimated to be $18.65 million. Council Member Glover confirmed with Director Danner that the total sales tax generated in the City has increased approximately $3 million over the prior two years. Director Danner stated that he would provide information later in the overview on where the increase is coming from. City Manager Bludau stated that copies of the slides could be provided upon request. ® City Manager Bludau then showed a slide on the sales tax contribution of selected geographic areas, which included Fashion Island, the airport area and the Balboa area. Volume 53 - Page 329 INDEX Budget Overview (40) J City of Newport Beach Study Session Minutes May 9, 2000 INDEX In response to Council Member Glover's question, City Manager Bludau stated that there is not a statistical breakdown available for the Mariners' Mile area. Director Danner stated that the information is received from Municipal Resource Consultants (MRC) and that the company is going out of business, making the information difficult to obtain. City Manager Bludau next presented a slide on the local sales tax by economic segment. He stated that it shows that the 400 restaurants in the City provide 19% of the total sales tax generated, the five car dealers provide 12% and the large department stores provide 11 %. Director Danner added that the top 8% of the companies that pay sales tax contribute 43% of the total dollar value. City Manager Bludau listed the top ten sales tax producers in the third quarter of 1999. The list included David L. Cunningham, Inc., a wholesaler of trees and plants, and DVI Financial Services, a medical equipment lessor. Council Member Thomson pointed out that this provides a good example of how office buildings can generate sales tax. City Manager Bludau presented a slide showing the distribution of property tax, with the City getting 17 %. He pointed out that the City received an additional 3% before the creation of the Education Revenue Augmentation Fund (ERAF). He stated that approximately $3.5 million is diverted per ® year, with a total of $27 million diverted over the period. City Manager Bludau stated that cities haven't been able to put a cap on the total or to receive any of the funds back. In response to Council Member Ridgeway's question about possible legislation, City Manager Bludau stated that it is frustrating to attempt to put a cap on the total when the funds should really be returned, given the State's budget surplus of $8 to $12 billion. Council Member Debay confirmed with Director Danner that the property tax distribution to other local ERAF represents the money that was taken away from the County and special districts as part of the property tax shift. City Manager Bludau stated that the City is expecting to receive $25.8 million in property tax in the 2000 -2001 fiscal year. City Manager Bludau next presented various property tax numbers. He said that the gross property value of which the property tax is levied is nearly $14 billion. He said that approximately 81% of the parcels in the City are residential and that the single - family home value increased by 12.58% in 1998 -99. Director Danner explained that the 84.40% decrease for industrial value in 1998 -99 represents unsecured property taxes that various industrial companies pay. Council Member Thomson confirmed with City Manager Bludau that the ® single - family home value is determined by the County Tax Assessor and includes resells and any overall tax increases. It is the value on the books, and not necessarily the market value. Council Member Thomson stated that Volume 53 - Page 330 City of Newport Beach Study Session Minutes May 9, 2000 INDEX there is a phenomenal revenue opportunity when one considers that 20 to 25% of the homes are being assessed at pre- Proposition 13 values. Mayor Noyes asked for additional information on the unsecured property taxes paid by the industrial companies. Director Danner explained that these taxes are paid by companies and based upon such things as inventory and equipment. City Manager Bludau added that four of the City's largest commercial property owners are requesting value reductions and if approved, could result in an annual property tax revenue loss of approximately $1.2 million. Director Danner referred to the Proposed Revenue Estimates - All Funds chart in the 2000 -2001 Budget Detail. He summarized the information by noting that $25,810,000 is expected in property taxes. Council Member Glover confirmed with Director Danner that the secured property tax of $22 million includes both residential and commercial. City Manager Bludau added that approximately 77% of the total comes from residential. Director Danner continued by noting the sales and use tax, and the uniform transient occupancy tax (UTOT) totals and increases estimated for 2000- 2001. ® Director Danner confirmed for Council Member Thomson that the UTOT total is the total the City receives, the net total after the Newport Beach Convention & Visitors Bureau receives their share. Director Danner pointed out that the general fund revenue total of $85 million is an increase of 3.28% over the current fiscal year. He added, however, that $4.3 million is expected from the oil spill recovery and, without that, the general fund revenue total would actually be down from the current year. He stated that this decrease is attributed to a decline in building activity and a one -time COPS (Community Oriented Policing Services) More Grant that was received in 1999 -2000. Director Danner noted that the oil spill recovery revenue is listed under Private Refunds & Rebates, 010 -5864, under other revenue in the general fund. Council Member Ridgeway suggested that the oil spill recovery revenue should not be in the general fund, but possibly set up as enterprise fund or another separate fund. Director Danner explained that the money has to be accounted for separately. A separate division in the Capital Improvement Program is being set up to keep it separated, but a separate fund is not being set up. In response to Council Member Ridgeway's question, Public Works Director Webb stated that the money will be used for very specific projects that were put together in competition with the other agencies that were requesting funding. He stated that they City is limited to the projects that ® were approved by the joint committee. He added that a report is also required and will be submitted to the Attorney General's Office on how the money was spent. City Attorney Burnham stated the Recreational Volume 53 - Page 331 City of Newport Beach Study Session Minutes May 9, 2000 ® Resources Subcommittee meets every six months, and a progress report is required at each of these meetings also. Director Webb listed the top projects as including a refurbishment of both piers, improving the streetlights and sidewalks along the oceanfront, upgrading the lifeguard facility, starting the marine education center project and improving some of the restrooms along the oceanfront. Council Member Ridgeway confirmed that that they are all capital improvements being paid for out of the general fund. Council Member Thomson confirmed with Director Webb that the Balboa Island Ferry restroom project is being budgeted, but is not a part of the oil spill recovery expenditures. Council Member Debay stated that there is a strict requirement that the oil spill recovery money be spent in the area that was impacted by the oil spill. Director Danner confirmed for Council Member Ridgeway that the accounting of the oil spill recovery funds would be kept separate. Director Webb stated that the projects being paid for by the oil spill money were not previously budgeted. Council Member Ridgeway additionally confirmed that the pier projects would take care of 95% of the maintenance currently needed. Per Council Member Thomson's question, Director Danner stated that the ® City has various contingency reserves in not only the general fund, but primarily in the enterprise funds. He said that Council Policy F -3 outlines the requirements for how much money must be set aside each year for maintaining the reserves. Director Danner stated that the City Manager's Transmittal Letter in the Resource Allocation Plan discusses the reserves. He added that most of the reserves are fully funded. In reference to Council Member Thomson's question about the annual replacement of the pier pilings and future pier repairs, Director Webb stated that oil spill money could not be used for long -term future maintenance. He added that the money must be spent in the next eighteen months to two years. Council Member Debay reported that things were going well towards the City receiving its share of the oil spill money, but she has learned that a new attorney in the State Lands Department is looking at the Memorandum of Understanding (MOU) and has some concerns and questions. City Attorney Burnham added, however, that the State Lands Commission has determined that it doesn't want to participate in the assignment of settlement proceeds and may not be a part of the supplemental MOU. Director Danner concluded the discussion on revenues by stating that the total revenue estimated for all City funds for the 2000 -2001 fiscal year is $125,381,711, a slight decrease over the prior year. ® City Manager Bludau referred back to the slides and began the discussion on City expenditures. He stated that expenditures for the 2000 -2001 fiscal year, including capital projects, are estimated to total $134.5 million. He Volume 53 - Page 332 INDEX City of Newport Beach Study Session Minutes May 9, 2000 ® stated that general fund expenditures are estimated to total $79.5 million, with the slight increase from the prior year attributed to negotiated employee salary adjustments. He added that most department maintenance and operation, and capital budgets are remaining flat. City Manager Bludau listed the six new positions that are being recommended in the proposed budget. Referring to a slide illustrating total City expenditures by class, Director Danner stated that salaries and benefits account for nearly half of the City's total budget in the 2000 -2001 fiscal year. He said this is followed by capital improvements, and maintenance and operation, both at 24 %. He stated that other charges primarily include debt service payments, and that capital outlay at only 1% of the total City budget is spent on such things as computers and office machines. City Manager Bludau noted that 24% being spent on capital improvements is a much larger percent than is found in most cities. Council Member Ridgeway asked if a pie chart was created to show what percent salaries and benefits are of the operating budget, as was done with the total budget. Director Danner said that a pie chart has not been created, but he knows that salaries and benefits are approximately 70% of the operating budget compared to 49% of the total budget. ® Director Danner reviewed a slide that used a graph to compare the governmental revenues and expenditures over the last ten fiscal years, and pointed out that expenditures exceeded revenues in the early 1990's. He explained that the current budget year is again looking at expenditures exceeding revenues, because revenues received in prior years are expected to be spent in the upcoming fiscal year. Council Member Glover confirmed that this was an accounting issue and asked what the following fiscal year would look like. City Manager Bludau explained that the major change from year to year will be with capital improvements and when projects are being done. Council Member Glover asked if 25% is generally representative of the amount of the total budget that is spent on capital improvements. Director Danner stated that he did not know what the percentages used to be, but he knows that the spending went down in the mid- 1990's due to a downturn in the economy. Council Member Glover asked how the determination was made on what percent of the budget should be spent on capital improvements. City Manager Bludau stated that staff submits their requests for projects, and Director Webb reviews them and makes recommendations. City Manager Bludau stated that fewer projects are recommended for funding than are submitted, and that a balance is sought between operations and making sure the community sees the benefit of the projects. Council Member Glover stated that she has been questioned by many people about where the money is going, and she said that it looks like ® if capital improvements were decreased, expenditures would not exceed revenues. City Manager Bludau stated that there is a maintenance of effort requirement, in terms of the amount of general fund money that is put into Volume 53 - Page 333 INDEX City of Newport Beach Study Session Minutes May 9, 2000 ® capital improvements. He stated that this requirement totals approximately $8 million. City Manager Bludau noted that maintenance of effort does not necessarily mean maintenance, but is for capital improvements. Council Member Glover referred to a previous slide that separated maintenance and capital improvements. Council Member Ridgeway clarified that the City has an operating budget of approximately $85 million and a total budget of approximately $125 million. He stated that the money that makes up the difference between the two includes enterprise funds and other funds, with only $9 million from the generalfund. Director Danner referred to a slide that showed what happened to assessed valuations and property tax collections when ERAF started in 1992 -1993. He stated that property tax collections and assessed valuations were nearly equal that year. He said that in recent years, the property tax collections have increased and exceed assessed valuations, because of the robust economy. City Manager Bludau added that the chart illustrates that it has taken nine years for the City to get back to where it was in 1991 in regards to property tax collections. Director Danner showed a slide that presented public safety expenditures compared to tax revenues. He pointed out that in recent years, the revenue from property tax and sales tax has been able to completely fund the public ® safety expenditures for police, fire and marine. Council Member Glover confirmed with Director Danner that the public safety budget is over $40 million. She stated that property tax revenue used to cover police services, but that the chart combines property and sales taxes, and all public safety expenditures. Director Danner went on to look at a slide showing selected comparisons with other Orange County cities. He said that the report was presented at a previous City Council meeting. Council Member Thomson requested that the City Council receive a copy of the slides being shown as well as the notations being made. Director Danner continued to look at the County comparison chart and noted that Newport Beach ranked third among the cities in the County for revenue per capita and sixth in sales tax. City Manager Bludau stated that the comparison shows both per capita and rank among the 33 cities. Council Member Glover stated that Newport Beach should have a higher per capita rank than fourth for UTOT. Director Danner agreed and noted the overall rank of second for UTOT. He added that the City is proud of its ranking of first in per capita spending on public safety. City Manager Bludau said that the figure is misleading because so much of the public safety efforts are to accommodate visitors to the area. ® Council Member Debay asked if the other coastal cities use County and State resources to provide lifeguard and beach services. City Manager Bludau Volume 53 - Page 334 INDEX City of Newport Beach Study Session Minutes May 9, 2000 ® stated that it varies and is really a mixture. City Manager Bludau next showed a graph that illustrated the number of full time employees over the past ten years and in the proposed 2000 -2001 budget. He stated that the City had its most full time employees in 1990- 1991, its least in 1995 -1996 and is proposing a total of 706 for 2000 -2001. Director Danner stated that he would have to look up the numbers to answer Council Member Ridgeway's question regarding the percentage of new full time employees since 1995 -1996 who were public safety employees. City Manager Bludau added, however, that three of the six new positions being proposed for 2000 -2001 are public safety positions. Director Danner referred back to the Budget Detail and Operating Expenditures - All Funds. He stated that the chart provides a three -year history of expenditures. He also referred to Operating Expenditures by Department. He noted some of the expenditure totals that were illustrated in a previous pie chart. He stated that operating expenditures in the proposed 2000 -2001 budget for all funds are just over $95 million, which is a 0% increase over the previous year. He stated that this is due to several retro pays and a large sum of money for airport growth control spent in the current fiscal year. Council Member Ridgeway confirmed with Director Danner that the $95 ® million was exclusive of the $9 million for capital improvements. Director Danner invited any of the City Council members or the public to see Administrative Services Deputy Director Kurth or himself to go over the budget in any detail desired. City Manager Bludau moved on to the next slide, which showed airport growth control spending from 1980 -1981 through the current proposed budget. He noted that the proposed budget includes $250,000 for airport growth control spending and is down substantially from the year prior. He said the City Council might want to make the decision to increase this spending. Council Member Glover asked for details regarding the contract with Peggy Ducey. City Manager Bludau explained that when the 12 -month contract expires in August of 2000, the City has the option to either rehire her as a staff member or pay her one - year's severance. City Manager Bludau referred to a new slide and listed some of the key capital improvement projects for 2000 -2001. He summarized that 147 projects make up the capital improvement program and they total $25.9 million. City Manager Bludau concluded by stating that the proposed budget is really a status quo budget and at the next budget meeting, he would cover the ® changes in each department and then go through the budget page by page, and answer any questions. Volume 53 - Page 335 INDEX City of Newport Beach Study Session Minutes May 9, 2000 ® Council Member Glover asked about the fixed income budget she requested at a previous meeting. City Manager Bludau stated that staff could provide a proposal on where it would reduce expenditures if the estimated increase of $1 million in general fund revenues did not occur. Council Member Ridgeway clarified with Council Member Glover that she wanted to look at a fixed income budget with no new revenues, rather than a balanced budget. 4. PROPOSED HARBOR ELEMENT AND HARBOR COMMISSION Deputy City Manager Kiff presented a report on the City's request for a dredging permit before the California Coastal Commission, at a meeting held earlier in the day in Santa Rosa. He stated that he and Fire & Marine Deputy Chief Melum attended the meeting and had two items on the agenda. Deputy City Manager Kiff provided an overhead projection which listed various issues such as beach nourishment and ocean disposal, and compared what was proposed by the Coastal Commission with what the City asked for and what was agreed upon. Deputy City Manager Kiff stated that his biggest disappointment of the day was not coming to agreement on the beach disposal sand threshold. He stated that the Federal Consistency Supervisor was insistent that the Coastal Commission not approve a blanket permit to allow anything other ® than dredge material with 80% sand or more, or within 10% of the sand content on the receiving beach. Deputy City Manager Kills overhead projection specified that the City was asking for dredge material with 80% sand or more, or within 40% of the sand content on the receiving beach if dredged with a hydraulic dredge. Deputy City Manager Kiff stated that the Federal Consistency Supervisor was willing to approve individual permits at the lower sand content, but not a blanket permit. Deputy City Manager Kiff stated that the Coastal Commission did agree to revisit the issue if the City performed more testing on bay water quality. Council Member Ridgeway confirmed with Deputy City Manager Kiff that the Coastal Commission voted at the meeting held earlier in the day and did not approve the City's request for the lower sand content level. Deputy City Manager Kiff stated that the Coastal Commission's concern is with the toxicity of the sediment, and requested that the City run additional tests to prove that the sediment is not toxic. Deputy City Manager Kiff continued through the list of issues and where agreement was reached. He stated that the City did not contest two of the three eelgrass issues, but did contest the issue about where to mitigate. He stated that the proposed condition by the Coastal Commission was that if eelgrass is impacted, it must be mitigated on site. He stated that this makes mitigation the most expensive part of the dredging project. He stated that the City was able to convince the Coastal Commission that if eelgrass is impacted, the mitigation can occur offsite. He stated that this was approved ® for a location yet to be determined, but will most likely be a part of the City's eelgrass restoration plan. Volume 53 - Page 336 III"Ni�7 Harbor Element & Harbor Commission (24) City of Newport Beach Study Session Minutes May 9, 2000 ® Council Member Glover asked how often residents need to dredge. Deputy City Manager Kiff, with the help of the audience, stated that it's probably once every five to six years but depends upon the location of the dredging. Deputy City Manager Kiff stated that the City did not contest the permit term. He continued to the next issue on the list, areas off limits, which the City contested on the point of the method to be used to get off limit areas back in. He stated that the City asked for areas to be automatically allowed back in if proven clean through additional testing. He stated that the Coastal Commission approved the areas to be rapidly allowed back in, but not automatically. Deputy City Manager Kiff concluded with the issue on jurisdictional review. He stated that the proposal was for the Executive Director of the Coastal Commission to approve individual dredging applications under the blanket permit. He stated that the City asked to approve the individual applications within the City, with the Coastal Commission reviewing what the City was doing and revisiting the issue if they felt the City was not doing a good job. Deputy City Manager Kiff stated that the Coastal Commission stated that they do not have the legal authority to delegate the responsibility to the City, but that they did encourage the Coastal Commission staff to expedite the processing of all applications. In response to Mayor Noyes' question, Deputy City Manager Kiff stated that ® it will take two to three months to do the additional testing. He added that the City might be receiving some money to help pay for the testing from the TMDL grants being applied for by the Regional Board, but it will not hold up the testing process. Council Member Ridgeway stated that the bio -assay tests are complicated because they're trying to prove that the water and bay floor will allow plant and small life forms to live, and it takes time to prove this. Ralph Rodheim, member of the Ad Hoc Harbor Committee, stated that it has been a pleasure to serve on the Harbor Committee and that the Committee has spent a year looking at every aspect of the bay, the harbor, and upper and lower bay. He stated that the harbor is unique with residential, commercial and recreation uses. He stated that the Committee wanted to look at each of the elements, with emphasis being placed on the residents. Mr. Rodheim stated that the proposed Harbor Element of the General Plan, prepared by the Committee, addresses these issues and he'd like to see the process move forward in adopting it. He stated that the document was prepared with the help of input from citizens, the charter industry, the fishing industry, recreational boating and the environmental industry. He stated that it has resulted in a balanced document and includes every constituent that has an interest in the harbor. He thanked City staff, particularly Assistant City Manager Wood and Senior Planner Alford, and Council Members Glover and Ridgeway and Mayor Noyes. Mr. Rodheim stated that other Committee members were also present in the audience to ® answer any questions. Referring to the statistics presented earlier in the meeting that 81% of the Volume 53 - Page 337 INDEX City of Newport Beach Study Session Minutes May 9, 2000 ® parcels in the City are residential, Council Member Ridgeway commented about the appropriateness of the proposed Harbor Element being residential friendly. He also stated that he felt that the document was one of the best policy documents presented to the City Council in quite some time. He stated that it doesn't state regulations, but provides for a balance. Mayor Pro Tern Adams asked about the environmental documentation needed to establish the Harbor Element in the General Plan. Planning Director Temple stated that it could be done through a negative declaration, and would require public hearings at both the Planning Commission and the City Council if it is to become a part of the General Plan. Council Member Debay referred to the staff report and the statement that the proposed Harbor Commission could make recommendations concerning land use and property development applications affecting harbor activities. She asked if this meant that a restaurant applying for a permit on a bay front location would be required to go before the Harbor Commission prior to going before the Planning Commission. Mr. Rodheim stated that it is recommended to form a Harbor Commission and bring a higher level of expertise to focus on the water and all of the related elements. Council Member Ridgeway stated that the answer to Council Member Debay's question is that a bay front restaurant would not have to go before the Harbor Commission. However, he also referred to goal HB -1 in the ® proposed Harbor Element, which includes maintaining a balance of compatible uses while allowing water- enhanced commercial activities such as dining. He said that the proposed Harbor Commission's intent is not to add another level of regulation. Mayor Pro Tem Adams stated that the powers and duties of the proposed Harbor Commission need to be more clearly defined, and he asked if the Harbor Commission would replace the Harbor Committee and the Harbor Quality Committee. Mr. Rodheim stated that it would replace the Harbor Committee, but that there would still be a need for the Harbor Quality Committee. Council Member Ridgeway agreed that the Harbor Quality Committee would have to remain, since it is more back bay focused while the Harbor Commission would be lower bay focused. He added that the upper bay issues are very complex since they involve many jurisdictions. Additionally, he referred to the recent reorganization of the Marine Environmental Division and the many issues it will be involved with in the lower bay area and how that would tie in with the new Harbor Commission. Council Member Ridgeway stated that the Deputy City Manager is the common thread between the upper and lower bay issues. Council Member Glover stated that she did not anticipate that the Harbor Commission would handle any grievances and she would not agree with them doing so. She added, however, that the City does need a group that is ® committed to the water and activities on the water, but she doesn't think they should operate like a Planning Commission for the water. Volume 53 - Page 338 INDEX City of Newport Beach Study Session Minutes May 9, 2000 INDEX Mr. Rodheim stated that the Harbor Commission would bring the stakeholders into the process. Council Member Debay referred to the proposed powers and duties of the Harbor Commission as presented in the staff report, and said she could not support the Harbor Commission making recommendations to the Planning Commission and the City Council on applications concerning land use and property development that may affect harbor activities. Mr. Rodheim cited an example of what would happen if the Cannery Restaurant and the Schock Boats property became residential parcels. He stated that a Harbor Commission should be able to make a recommendation about the consequences of losing the commercial element for the boating industry, but he is not asking for the Harbor Commission to have any power to make the final decision. Council Member Thomson suggested that the powers and duties of the Harbor Commission be more on the level of the Parks, Beaches & Recreation Commission rather than that of the Planning Commission, with any decisions recallable by the City Council. Council Member Thomson referred to the proposed powers and duties as presented in the staff report, and stated that serving as an appellant and reviewing body for decisions of the Deputy City Manager is stated in terms that are too broad. Council Member Thomson suggested that the specific matters that the Harbor Commission ® would review should be given. He added that the selection process for the members should also be more clearly defined. Mr. Rodheim agreed that these types of issues need to be discussed. He stated that the Harbor Commission only wants to help the Planning Commission and the City Council, and not replace any of their decision - making authority. Council Member Thomson stated his support for the concept of a Harbor Commission, but is wary of it being too commercially oriented. He stated that stakeholders should be considered as everyone who lives or owns property in the City. Mr. Rodheim agreed. Council Member Ridgeway stated that the intent is not to create a dynasty, but to provide a group that is not more regulatory or controlling. Mayor Noyes agreed that there are issues to clear up and asked how the process to form a Harbor Commission should proceed. Mayor Pro Tem Adams stated that he would support the existing Harbor Committee better defining the powers and duties of the proposed Harbor Commission, but that the policies contained in the proposed Harbor Element seem to need no additional work. Mr. Rodheim agreed and thanked the City Council for their support. ® Mayor Pro Tern Adams stated his concern that the Planning Commission might not focus on the harbor as much if there was the existence of the Harbor Commission, since they would know that there is another body who Volume 53 - Page 339 City of Newport Beach Study Session Minutes May 9, 2000 ® is handling those issues. Council Member Ridgeway stated that the Planning Commission has never reviewed anything on the bay, to his knowledge. He said they have reviewed water- enhanced restaurants and walkways, but he doesn't see the overlap between the two commissions. Planning Director Temple stated that the Planning Commission can only approve a project if there is the finding that the project is consistent with the General Plan. She stated that if the Harbor Element were a part of the General Plan, the Planning Commission would have to consider the policies in the Harbor Element when deciding whether to approve a project and include them in their findings. She stated that the water and land wouldn't cross, but the policies of both would be involved in the decision- making process. Council Member Ridgeway agreed and stated that there is some language in the proposed Harbor Element that needs to be changed so that it does not appear that property rights are being taken away. He stated that he would also like to see language added that makes it clear that commercial requests can not be inconsistent with the residential community. Planning Director Temple clarified for Council Member Debay that any change in use, if subject to a discretionary permit or action by the Planning ® Commission or City Council, would need to be evaluated in light of the policies in the Harbor Element. She stated that there are many permitted land uses in the waterfront commercial districts, but a change in land use would require findings consistent with the General Plan. Council Member Ridgeway stated that "is no longer economically viable or is obsolete or replaced elsewhere" needs to be deleted from the third implementation strategy listed in the staff report for Objective HB -1.5. He stated that the standard, as written, is putting a restriction on the change of use by landowners. He said the deletion will increase the ability for the decision makers to decide on a change of use. Council Member Thomson stated that there are many new disciplines involved with the issues being addressed by the proposed Harbor Commission, and the formation of the Commission should be carefully thought out to work in concept with all of the policies of the City. Mayor Pro Tern Adams suggested that the Harbor Element document include realistic expectations for the residential character on the bay. He cited the example of a bay front homeowner not being able to expect the same peace and quiet that someone living in Cameo Highlands might have. Council Member Ridgeway stated his understanding of Mayor Pro Tom Adams' concern. ® Council Member Glover stated that there is no promise anywhere in the City that a resident will have peace and quiet, referring to the weddings that take place in some of the parks in the City. She stated her concern that Volume 53 - Page 340 INDEX J Ob J City of Newport Beach Study Session Minutes May 9, 2000 waterfront property issues will have one more layer to go through, when there are already the Coastal Commission, the Planning Commission, the City Council and the many individuals who watch these issues closely. She stated that she'd like to have many of the waterfront parcels in the Mariners' Mile area kept for marine uses. John Corrough stated that he is a waterfront property owner who does not have unrealistic expectations. He stated that he has been honored to be a part of the process as a member of the Harbor Committee. He stated that the members of the Committee really walked in each other's shoes and tried very hard to understand the position of the other person. He added that he also played the role of consultant on the Committee. Mr. Corrough concluded by stating that, as a consultant, he was impressed with the quality of the effort from such a broad -based group of people. PUBLIC COMMENTS - None. ADJOURNMENT - 6:15 p.m. *, r*, rett,rtttt + +� *+ *:+ *txrt,errrr�x The agenda for the Study Session was posted on May 4, 2000, at 11:30 a.m. on the City Hall Bulletin Board located outside of the City of Newport Beach Administration Building. City Clerk Volume 53 - Page 341 INDEX