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HomeMy WebLinkAbout05/12/2009 - Study SessionCITY OF NEWPORT BEACH City Council Minutes City Council Study Session May 12, 2009 — 3:00 p.m. I. ROLL CALL Present: Council Member Henn, Council Member Rosansky, Mayor Pro Tem Curry, Mayor Sehrh, Council Member Gardner, Council Member Daigle Excused: Council Member Webb Council Member Rosansky arrived at 3:10 p.m. II. CURRENT BUSINESS 1. CLARIFICATION OF ITEMS ON THE CONSENT CALENDAR. In response to Council Member Daigle's questions regarding Item 4 (Special Events Advisory Committee), Council Member Henn indicated that the committee will review the events, but will not solely use financial measures to determine if the event provides an appropriate contribution to the City. He noted that the benefits to the City can be financial, social, or community - related. He added that the committee's recommendations are advisory and confirmed that Council would have final decision - making authority. Council Member Daigle requested and received clarification from City Manager Bludau relative to Item 5 (Equestrian Center at Orange County Fair) that the City will be provided the opportunity to comment on the Environmental Impact Report (EIR) and that the draft resolution was provided by the City of Costa Mesa. Regarding Item 14 (American Recovery and Reinvestment Act of 2009 Status Report), City Manager Bludau indicated that the staff report discusses funding that the City will be receiving, not possible funding that has not been applied for, especially in light of how labor- intensive the application process has been. Public Works Director Badum confirmed for Mayor Pro Tem Curry that Item 7 (Subdrain Improvement Projects) will address perpetual seepage hole at Spyglass Hill. 2. H1N1 INFLUENZA UPDATEXITY OF NEWPORT BEACH. Fire Chief Lewis indicated that City personnel had participated in daily conference calls with the County and surrounding cities to discuss issues and determine how to address the public's fears. 3. BUDGET REVIEW -OVERVIEW AND CIP. Budget Overview. Administrative Services Director Danner utilized a PowerPoint presentation to discuss the budget process, what items are included in the budget, the purpose of the City's budget, the City s fund structure; revenues, sources of revenue, revenue projections, expenditures, debt service expenditures, internal service fund expenses, supplemental budget requests, Volume 59 — Page 149 City of Newport Beach City Council Study Session May 12, 2009 the Capital Improvement Program (CIP) over the last five years, and the General Fund. He displayed a General Fund revenue /expenditure comparison, a comparison of authorized positions by fund, and proposed position changes. He also highlighted recurring Council grants, the efforts by all departments to reduce the budget by 2% in order to save over $3 million, budgeted positions, and the General Fund special reserves. He described the pending issues that will be discussed starting at the May 26 Study Session. He reported that the State has proposed, pursuant to Proposition IA, to borrow up to 8% of fiscal year 2008 -2009 property tax revenues from cities and counties if the special ballot issues on the May 19 Special Election fail. He noted that this could cost the City $4.5 million to $5.5 million, and emphasized that Proposition IA requires that the funds be repaid to the entity with interest in three years. He reported that the City's total General Fund is projected to be about $150.1 million with a $148.1 million operating budget, adding that the budget has already taken into account Memorandum of Understanding (MOLT) increases. He stated that the City's budget documents are available on the City's website. City Manager Bludau reported that the budget will not include any stimulus package money until it is received. He also indicated that, relative to the supplemental budget that totals $574,000, he normally receives over $1 million in requests but he directed the departments to only request essential items. He noted that Recreation's requests are offset by additional revenues. He pointed out that the only personnel request he received was for one full -time position in the Police Department; however, he did not approve that request. He indicated that the current proposed budget still allows Council the discretion to utilize $1 million for projects. In response to Council questions, Administrative Services Danner indicated that the City should be at the end of the revenue down cycle by the end of the calendar year and noted that the Fashion Island Nordstrom is scheduled to open in April 2010. He expressed hope that car sales will recover. City Manager Bludau added that the City may see a 10% reduction from anticipated revenues. He stated that the City has received preliminary financial information from Pelican Hills, but the City is remaining conservative with its assumptions. Administrative Services Director Danner indicated that the City's total assessed valuation is about $38 billion and reported that, pursuant to Council Policy F -2, the City's reserves are fully funded. Regarding Council budget reductions, he reported that Council's budget met the 2% reduction by not allocating as much money in the special fund. Discussion ensued relative to the funding of Capital Improvement Projects. Administrative Services Director Danner clarified that project funding could be rolled -over depending on when the funds are appropriated. Further, all appropriations lapse on June 30 unless it has been encumbered or contracted. Regarding recurring Council grants, Council Member Gardner requested that the City ask the Conference and Visitors Bureau (CVB) for a synopsis of what benefits the City might receive from the Ensenada Race and Orange County Marathon. Administrative Services Director Danner confirmed that the Business Improvement Districts are included in the budget, but the Restaurant Association's requests are not on the grant list. Mayor Pro Tem Curry commended staff for reducing the current fiscal year budget by 1% ($3 million) and the upcoming fiscal year budget by another 2% ($3 million) without there being a reduction of services to the public. Council Member Daigle asked how some departments were able to reduce their budgets by 4% without conducting any layoffs. City Manager Bludau emphasized that public safety will not be compromised this year; however, the current budget cut is short-term. Administrative Services Director Danner noted that many of the departments reached the 2% target by under -filling positions or not Volume 59 — Page 150 City of Newport Beach City Council Study Session May 12, 2009 filling positions at all, but the positions have not been eliminated Capital Improvement Proogram_ (CIP).Overview Deputy Public Works Director Webb utilized a PowerPoint presentation to highlight the completed CIP projects for the 2008 -2009 fiscal year, the Public Works Department's role in CIPs, CIP funding for the 2009 -2010 fiscal year, current CIP work in progress, the CIP history, and the status of deferred 2008 -2009 fiscal year projects. He provided an overview of the following CIP budgets, including upcoming projects: Facilities; Streets and Draining - Street Improvements; Streets and Drainage - Other Improvements; Traffic; Parks, Harbors and Beaches; Water Quality and Environmental; Water Facilities; Wastewater; and Miscellaneous. He also discussed the phases involved in the Traffic Synchronization Management (TSM) Plan, and the status of each phase. He stated that the PowerPoint presentation will be posted on the Public Works Department website. In response to Council questions, Deputy Public Works Director Webb explained that any contingency that is not spent is reprogrammed for new projects. He further clarified that, if the contingency amount is not enough, the project would be stopped until Council authorizes additional appropriations for the project during a Council meeting. Council Member Henn requested that the funding sources be more clearly identified so it can be easily determine whether the funding that is being sourced from various funds was intended to come from that source or if the funding was unused by a completed project. Mayor Pro Tem Curry noted that the number of staff remained the same while the number of projects increased. Deputy Public Works Director Webb commended staff and explained the advantages of using in -house staff versus too many outside consultants. Public Works Director Badum added that many projects are time and season sensitive, which can easily push projects to another time; however, staff does a good job to not defer and rebudget too many projects. Regarding deferred projects, Deputy Public Works Director Webb stated that a less expensive plan for the Bristol Street North Landscape Improvement project could be developed in order to move it forward and that the Semeniuk Slough Dredging project can move forward if the U.S. Army Corps of Engineers can provide funding or any other funding source is located. Mayor Selich pointed out that the Back Bay View Park Replenishment/Enhancement project still requires more work, but noted that it is currently not being recommended. Regarding current projects, Deputy Public Works Director Webb discussed the Jamboree Bridge Widening project, the pavement plan for Lido Isle and Balboa Island, the water main plan on Balboa Island, the streetlight conversion program and the possibility of toning down some of the lights throughout the City, the Balboa Island and Harbor Bulkhead/Seawall Repair project, and the Buck Gully Canyon Stabilization and Flood Control project. Public Works Director Badum reported that staff will receive more training on the TSM system to better improve the traffic flow in major intersections, but it has already been used during special events and accidents. He also stated that the City Hall and Park project is being designed to take advantage of reclaimed water; however, Utilities Director Murdoch pointed out that the City currently does not have the infrastructure to add too many reclamation lines. City Manager Bludau announced that, at the next study session, Council will discuss the list of pending issues and that Council will be presented with copies of the departmental budget PowerPoint presentations in advance. Volume 59 — Page 151 City of Newport Beach City Council Study Session May 12, 2009 Allen Maxfield, Island Avenue, expressed concern that the bay-front's seawall stops, but expressed appreciation that his street will be repaved and that the seawall will be fixed. City Attorney Hunt recommended, in addition to Council discussing what is currently on the Closed Session agenda, that an item be added to discuss Assessment District No. 87 (Balboa Island), pursuant to Government Code §54954.2. He explained that this item is on the regular agenda; however, the City received correspondence from the opposition to the Assessment District on Friday with clear indication of potential litigation (Government Code §54956.9 ro». Motion. by_C4Unci1 Member Gardner to add an item to the Closed Session agenda, pursuant to Government Code §54954.2, to conference with legal counsel due to potential exposure to litigation relative to Assessment District No. 87 (Balboa Island) (Government Code §54956.9(b)). The motion carried by the following roll call vote: Ayes: Council Member Henn, Council Member Rosansky, Mayor Pro Tem Curry, Mayor Selich, Council Member Gardner, Council Member Daigle Absent: Council Member Webb III. PUBLIC COMMENTS - None IV. ADJOURNMENT - 4:55 p.m. The agenda for the Study Session was posted on May 6, 2009, at 4:05 p.m. on the City Hall Bulletin Board located outside of the City of Newport Beach Administration Building. C� -Q hmvv-'�' Recording Secretar Mayor Volume 59 - Page 152