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HomeMy WebLinkAbout01/31/2015 - Special MeetingCity Council Minutes Special Meeting 2015 Planning Session January 31, 2015 — 9:00 a.m. 1. WELCOME AND INTRODUCTIONS Roll Call by City Clerk Present: Council Member Peotter, Council Member Petros, Council Member Curry, Council Member Duffield, Council Member Muldoon, Mayor Pro Tem Dixon, Mayor Selich Review Agenda Mayor Selich provided welcoming remarks, commented on the structure of the meeting, and reviewed the Planning Session Agenda. 2. FINANCIAL UPDATE Utilizing a PowerPoint presentation, Finance Director Matusiewicz discussed the Financial Update, noting that the City ended with a $10 million reserve surplus last fiscal year from better - than - expected revenues, as well as department savings. He addressed the City's holdings, General Fund reserves, contingency reserve, current fiscal year revenue trends, sales receipts, developer fees, property taxes, assumptions, revenue estimates, and increases in sales tax. He reported on overall revised mid -year estimates, implementation of the ERP system, commitments and expenditures, and keeping up with aging infrastructure and liabilities. Finance Director Matusiewicz presented a recap of pensions and addressed unfunded liabilities and changes in rate assumptions. He reported on actions taken by the City to reduce and accelerate payments toward pension liabilities. He addressed the source of additional funds used to accelerate payments and economic benefits and savings resulting from doing so. He also noted that employees are contributing more towards their pensions to assist in offsetting increases in employer pension costs. City Manager Kiff discussed the Public Employee Pension Reform Act ( PEPRA). He noted that PEPRA is requiring employees of local agencies to contribute at least 50% of the normal pension costs by 2017. He emphasized that City employees are already contributing 51% of their share. They are also paying some of the total pension costs, including unfunded liabilities. Finance Director Matusiewicz provided a synopsis of City actions to address unfunded liabilities and discussed the Facilities Financial Plan (FFP). City Manager Kiff noted that the City is in good financial shape with strong revenues, progress relative to pension issues, controlled debts, implementation of the FFP, CIP projects, and funded base operations. He pointed out that spending flexibility is limited and that the budgeting approach should focus on projects that are underway and budgeted. Additionally, he suggested prioritizing things that are not budgeted and then implementing them when funds become available. He encouraged the City Council to approach him with ideas for expenditure reductions. Volume 62 - Page 177 City of Newport Beach Special Meeting - 2015 Planning Session January 31, 2015 In response to Mayor Selich's questions, City Manager Kiff reported that the initial purchase for the Road and Track Building came from the FFP and that the revenue was placed back into the FFP. Regarding the appropriate level of reserves for the City to have, he stated that it would be set by specific identification of existing requisitions, savings plans, and community and strategic needs. In response to Mayor Pro Tom Dixon's question, Finance Director Matusiewicz addressed projected development contributions and how they fit into the City's financial plan going forward. City Manager Kiff added that the FFP spreadsheet that includes that information will be placed on the City's website. Council Member Petros commented on the known development agreements with 10 to 15 year terms. He noted that the FFP schedule goes out to 2060, but commitments from development agreements will pay for FFP projects only until 2040. Finance Director Matusiewicz added that the City will make General Fund contributions which will also be used for FFP projects. He addressed total public benefit fees expected. Council Member Petros stressed that the FFP is not an annualized or short -range planning tool, but rather the culmination of City facility projects that would like to be done in the City. He indicated that the City can pay for all the planned projects with the revenue sources that are known at this time. In response to Council Member Peotter's questions, City Manager Kiff noted that utilities are addressed in other master plans that will be presented shortly. He stated that the FFP mirrors the various plans for City facilities and added that all other master plans used by the City to manage its facilities are funded as well. He clarified that the Water Master Plan and Waste Water Master Plan funds are outside of the General Fund. In response to Allan Beek's question, Finance Director Matusiewicz provided an explanation of non - spendable, restricted, committed, assigned, and contingency, which are terms included in accounting standards and provided examples of each. City Manager Kiff noted that they are also explained within the City's budget document. Jim Mosher asked regarding the portion of property taxes that come from commercial and residential taxes, as well as the current status of the employee cost compensation study. He commented on the FFP and believed that today's meeting was going to be a goal and priority - setting session. He added that he is curious to know what Council Members' ideas are in terms of priorities, goals for the City, and how to spend the City's money for the upcoming year. Finance Director Matusiewicz reported that property taxes are made up of 80% residential, 14% commercial, and 6% smaller components. He indicated that Council is able to provide direction in terms of the scope and timing of FFP projects. City Manager Kiff reported that the employee compensation study has been placed on hold until new Council Members become more acclimated. He stated that the classification portion of the study has been completed. Lee Pearl commented on City reserves and noted the importance of the City Council reviewing the City's long -range financial plan. He stated that projects may be missing and suggested that Council may find that it does not have the level of reserves it claims to have. He urged Council to look at the long -term facilities plan and financial plan. Additionally, he believed that the City is in a good path relative to pensions and cutting costs. 3. RECESS Mayor Selich recessed the meeting at 9:52 a.m. and reconvened the meeting at 10:03 a.m. with all members of the City Council present. Volume 62 - Page 178 City of Newport Beach Special Meeting - 2015 Planning Session January 31, 2015 4. CAPITAL PROGRAM UPDATE Public Works Director Webb provided a PowerPoint presentation relative to the City's Capital Improvement Program (CIP) to address prior goals, planning documents including the General Plan and the various master plans, funding sources for the CIP, Council contributions to the CIP, specific projects and their status, major projects, study efforts currently underway, and the FFP. He referenced a summary of projects, their status and funding source and addressed specific projects, including the West Newport Project pertaining to upgrading and enhancing landscaping along West Coast Highway. In response to Mayor Selich's question regarding design and engineering the West Coast Highway project, Public Works Director Webb reported that the goal is to add it to next year's CIP. He added that it has not been programmed for construction at this time. Public Works Director Webb addressed the Balboa Island Seawall Project, the Corona del Mar Entry Project, dredging, and 15th Street Rehabilitation. Council Member Petros commented on the signal at 15th Street and Balboa Boulevard. He added that there was a comment made regarding not being able to underground utilities on Balboa Island because of the water level and noted that undergrounding could be accomplished in certain areas of Balboa Island. Public Works Director Webb addressed replacement of the Corona del Mar Library and Fire Station, the Lido Fire Station, projects within the Balboa Village Revitalization Master Plan, and the building at the end of Newport Pier. Chief Building Official Jurjis provided an update on the status of the building at the end of Newport Pier. Public Works Director Webb continued with his presentation and addressed the Mariner's Mile highway reconfiguration, land use, neighborhood revitalization, the Balboa Village Fine Arts Center, building a bridge connecting the parking lot to Sunset Ridge Park, and Lower Castaways. He also commented on existing restrictions on the Lower Castaways property, including maintaining Marine Protected Areas and access to the property. Harbor Resources Manager Miller added that Lower Castaways cannot be a revenue- generating commercial marina to compete with The Irvine Company's marinas across the way. Council Member Petros reported on his recent experience at the pedestrian /cycling crossing at Superior Avenue and Pacific Coast Highway when he was walking off the curb and a woman almost ran him over. He noted working recently with the Orange County Transportation Authority (OCTA) on its long -range transportation plan for the County and was able to move this project forward for the County to consider. In response to Mayor Pro Tem Dixon's question, Public Works Director Webb reported that during the Coastal Commission hearing, the Commission nodded in support for the Sunset Ridge Park bridge conceptual plan. He addressed the budget to design the bridge and possible sources for funding. Public Works Director Webb discussed other CIP projects, including creating another dog park, Big Canyon Water Quality improvements and habitat restoration, projects along Newport Boulevard, opportunities for median landscaping, and the Corona del Mar Bike Path. Assistant City Manager Badum reported that the City Manager's Office is helping with coordinating public outreach to discuss needed facilities in the West Newport area. He commented on the possibility of a community center and major park on that side of town, the Volume 62 - Page 179 City of Newport Beach Special Meeting - 2015 Planning Session January 31, 2015 possibility of consolidating City yards, the possibility of a new Police Station on the site of one of the yards, and options for the existing buildings. He also provided details on the concept of a community center in West Newport, including possible locations, outreach efforts, and preferred amenities. In response to Council Member Muldoon's question, Assistant City Manager Badum provided information regarding the online survey relative to West Newport facilities. He also outlined the possible amenities to be included in the community center and presented a conceptual depiction of the community center. Council Member Petros commented on the importance of acknowledging the citizens, businesses, and Hoag Hospital. He noted that there is a strong willingness on the part of Hoag Hospital to work in conjunction with the City in terms of providing wellness services and adult health education at the new community center. In response to Mayor Selich's question, Assistant City Manager Badum identified the Coastal Zone boundary and addressed costs related to underground parking. Public Works Director Webb stated that, going forward, he will be looking for guidance from the City Council and the City Manager. City Manager Kiff added that Council could provide its thoughts, but noted the need to return during a regular meeting for further discussion, consideration, and direction. Mayor Pro Tern Dixon commented on the possibility of categorizing projects in terms of essential and/or required and non - essential going forward. Public Works Director Webb highlighted projects that need to be addressed, deferred, or are Council priorities or citizen requests. Evelyn Hart commented on partnering with Hoag Hospital and suggested that the recreation pool should be a therapy or exercise pool. She commented on the Balboa Theater Foundation and stated that it would be helpful to dissolve it and that they welcome Council direction moving forward. Additionally, she commented on the City's Housing Element and emphasized the need for senior affordable housing. Bill Dunlap referenced the CIP and asked whether the City has considered going to an alternate method of design and build. Public Works Director Webb reported that the City has looked at alternative methods and may do so again, depending on the project size. Mr. Dunlap encouraged the City to seriously consider it. Council Member Petros commented on Mr. Dunlap's knowledge and thanked Mayor Pro Tern Dixon for bringing up alternative systems. He thanked Mr. Dunlap for bringing the matter forward. Bernie Svalstad, Chair of the Corona del Mar Business Improvement District, noted that the Corona del Mar Entry Project has been reviewed many times throughout the years, and urged Council to move forward and approve it in the upcoming fiscal year budget. Jim Dastur, President of the Balboa Island Seawall Project Group, asked how decisions are made relative to funding sources and whether the seawall project will be funded by tidelands funds. City Manager Kiff reported that, generally, staff will make recommendations to Council regarding project funding. He added that the funding source for the seawall project will depend on the phasing for the project. Volume 62 - Page 180 City of Newport Beach Special Meeting - 2015 Planning Session January 31, 2015 Lee Pearl commented on the Council's prior priorities and believed that Balboa Island is also an area that needs to shine. He noted that there are many infrastructure needs on Balboa Island that need to be addressed. He referenced a survey of Balboa Island residents and reported that some of their priorities include airport noise and pollution and street rehabilitation. Deborah Hardaway asked whether it was possible to use Coastal Peak Park as a place where she and her husband could take their dogs. She commented on challenges with having dogs on leashes. Bob Shelton, on behalf of the Corona del Mar Residents Association, asked regarding the possibility of widening the sidewalk at Vista Point and building a small retaining wall. Allan Beek believed that the Balboa Island Seawall Project is a band -aid that does not fix the problem. Jim Miller agreed with Mr. Beek, adding that the gate needs to be looked at. He commented on challenges relative to high tides on Newport Island. Jim Mosher thanked the City Manager for not forcing Council to make commitments on short notice and suggested providing handouts to Council and the public prior to the meeting. He commented on the many master plans the City has and wondered if they can be organized in a single place on the City's website. He addressed the West Newport community center, possible locations, and took issue with the number of responses to the survey. Council Member Muldoon commented positively on Mayor Pro Tem Dixon's suggestion regarding prioritizing projects by necessity. He requested additional information regarding the Balboa Fine Arts Center and different options for the Balboa Island Seawall Project. Mayor Pro Tern Dixon suggested applying the funds left over from the Balboa Theater Foundation to the Fine Arts Center. Additionally, she suggested soliciting private matching funds for other community projects to offset the use of General Fund money. Council Member Duffield commented on the Balboa Island Seawall Project and other related challenges, and stated that he is anxious to work with staff and the community to develop reasonable, immediate solutions. In response to Council Member Peotter's question, City Manager Kiff reported that Public Works Director Webb has identified Capital Improvement Projects that are currently underway, but Council may identify projects for which additional information is requested. Council Member Peotter suggested prioritizing debt reduction, the possibility of establishing a debt - reduction fund, especially as it applies to City Hall debt, creating self -help funds relative to undergrounding utilities, increasing the participation of BIDs, and developing community- building events. Council Member Curry acknowledged the attendance of former Council Member Gardner, noting that she has been a strong supporter of the tidelands, the Corona del Mar corridor, and Corona del Mar Library and Fire Station. He noted the importance of those projects. 5. RECESS Mayor Selich recessed the meeting at 11:42 a.m. and reconvened the meeting at 11:52 a.m. with all members of the City Council present. Volume 62 - Page 181 City of Newport Beach Special Meeting - 2015 Planning Session January 31, 2015 6. UPDATE ON PRIVATE PROJECTS Community Development Director Brandt provided a PowerPoint presentation to discuss major construction projects that are currently underway. She presented details of each project, including their status and building permit valuation. Regarding the West Newport Echo 56 Project, she noted that its intensity has been significantly reduced from the original plans. She addressed the Newport Bay Marina and a new residential project in Lido Village. In response to Mayor Pro Tem Dixon's question regarding the Lido Villas Project, Community Development Director Brandt reported that there was an issue with the Coastal Commission, but that has been resolved. Community Development Director Brandt addressed a residential project in Corona del Mar, the Newport Beach Country Club Project, and tenant improvements on Newport Center Drive. Additionally, she discussed a project adjacent to the Marriott Hotel on Santa Barbara Avenue, a project in San Joaquin Plaza, projects around the John Wayne Airport (JWA) area, and the Lido House Hotel and Back Bay Landing projects that are awaiting approval from the Coastal Commission. She presented an overview of several plans that will be presented to Council in the near future, including the Local Coastal Implementation Plan (LCP). She commented on several upcoming smaller projects, several General Plan amendments, the ExplorOcean project, the Koll Center Newport Project, and amendments to the Municipal Code. Council Member Petros referenced a Senate Bill, noting that it will take away the City's ability to call traffic congestion a significant impact. Nancy Skinner suggested cleaning up the City Charter relative to the Greenlight initiative. Nancy Gardner reported that she was a member of the Land Use Element Amendment Advisory Committee and that there was a lot of great work that went into looking at the overall General Plan. She suggested that the City Council review and adopt their work. Additionally, she suggested that Council consider working in partnership with non - profit organizations. In response to Scott Laidlaw's question, Community Development Director Brandt reported that the timeline she discussed for the LCP is very realistic. She addressed various workshops and indicated that, once the project reaches the Coastal Commission, this is where staff will lose control of the schedule. Dorothy Kraus asked how close Newport Center and Fashion Island are to reaching build out. Community Development Director Brandt noted that staff is working to identify the build out capacity in the area and that it is rather limited. SUMMARYIWRAP -UP City Manager Kiff noted that a lot of discussion focused on the CIP and FFP, and stated that he would like to bring those matters back to Council with a prioritization based on "must haves versus nicer to have" and also based on possibilities for public /private partnerships. Additionally, staff will bring back a discussion about seawalls, including the Harbor gate. Mayor Selich suggested providing a view of the past, what the City is doing, and direction for the future. Volume 62 - Page 182 City of Newport Beach Special Meeting - 2015 Planning Session January 31, 2015 Mayor Pro Tem Dixon commented on the work going on in District 1 and stated that she looks forward to continuing to work with the community. She reported on several upcoming town hall meetings and that she will continue to champion the projects. She requested that the Arts and Culture Master Plan be added to the list of future presentations in order to provide policy direction. Council Member Petros commented on developing a prioritization list of projects that can off -set their own costs, especially in terms of the West Newport Community Center and leveraging the Corporate Yard for lease or sale, and using those proceeds to offset costs. 8. PUBLIC COMMENTS ON NON - AGENDA ITEMS Lee Felling noted that the Balboa Island seawall is crumbling and expressed concerns that the level of sand next to the seawall is going down. He urged Council to move ahead with the seawall plan and agreed with breaking the project into smaller projects or phases. Lynn Smith encouraged Council to prioritize actions regarding more environmental issues and to create a sustainable and safe community. Mark Tabbert, Citizen's Climate Lobby, urged Council to address the matter of climate change. Jim Mosher commented on the Brown Act and thanked staff for including an opportunity for the public to comment on non - agenda items. He addressed the previous Council's actions relative to establishing priorities and referenced the type of government within the City. Scott Laidlaw reported that he is an architect and asked that, as Council reviews items, to think about working to create a whole look and feel for the City. Mayor Selich thanked all who attended the meeting 9. ADJOURNMENT - 12:30 p.m. The agenda for the Special Meeting 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 January 29, 2015, at 10:00 a.m. Recording Secretary f Cr I rma - "ayor Volume 62 - Page 183