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Minutes 2003-01-20361 MINUTES OF AN ADJOURNED REGULAR MEETING OF THE CYPRESS CITY COUNCIL HELD Janua~ 20,2003 The adjourned regular meeting of the Cypress City Council was called to order at 5:05 p.m. by Mayor McCoy in the Board Room, West Wing of City Hall, 5275 Orange Avenue, Cypress, California. PRESENT: Council Members McGill, Piercy, Sondhi, Mayor Pro Tern Keenan, Mayor McCoy ABSENT: None Also present were City Manager, Director of Finance and Administrative Services, Community Development Director, Chief of Police, Public Works Director, Recreation and Community Services Director, Assistant to the City Manager, Police Captain, Finance Manager, Recreation Services Manager, and City Clerk. WORKSHOP SESSION: Cypress Community Festival Management and Operation Discussion The Recreation and Community Services Director introduced Linda Sunley and Todd Seymore from the Cypress Festival Committee. The Recreation and Community Services Director stated that at the Mamh 26, 2002 workshop, the City Council requested that staff research the possibility of presenting the Cypress Community Festival as a citywide event managed by staff. Staff has also provided the options of contracting with a vendor and with the Festival Committee maintaining its principal role. The Recreation and Community Services Director stated that in the past, the City had a more active role in running the festival but as changes took place in the community, such as reduction of Recreation staff and the adoption of the Non Profit Policy, this changed significantly. Currently, the Festival Committee is responsible for the planning, operations, booth coordination, entertainment, and marketing. The City acts in a support role offering in-kind services, such as significant Public Works and Police assistance and Recreation staff for festival production activities. The Festival Committee also received a direct cash grant from the City. Option 1 would be to continue the event with the same level of City support as in 2002. The cost would be $31,000 for a one-day event and $41,000 for a two-day event. Option 2 would have the City take over total responsibility for the event's production. This would cause a tremendous cost increase due to the addition of permanent staff to assist with implementation of the event and would cause a loss of daily office productivity with staff efforts being re-directed on Festival related work. The cost would be $126,900 for a one-day event and $150,000 for a two-day event. Option 3 would be to contract with an established vendor to handle all production activities of the Festival. This option does not totally preclude staff and volunteer participation in the management of the event. The cost would be $67,400 for a one-day event and $88,900 for a two-day event. CITY COUNCIL MINUTES JANUARY 20, The Recreation and Community Services Director stated that the most cost effective and efficient manner to run the Festival would be to continue having the Festival Committee take the lead in directing the operations and the City providing operational support. Mayor Pro Tern Keenan stated he felt if the City or an outside vendor handled the Festival the revenue potential would be dramatically increased. The City or vendor would be able to obtain serious sponsorship for the event. Ms. Sunley stated she has had several meetings with staff and likes the idea of a two- day event and obtaining larger sponsors. She feels that the Festival Association and City staff have a wonder/ul working relationship. Currently the Festival has a "home town" feel to it, which may be lost with an outside vendor and larger attendance. Mr. Seymore stated that a two-day festival is a great idea but would not be feasible for this year. For this year, the Festival could possibly be extended into the evening with a concert. It was the consensus of the City Council to continue the Festival as in the past with the possibility of having a two-day event for next year and to review the budget prior to extending the event with a concert this year due to potential additional costs. Ms. Sunley stated there may be an issue of noise if a concert is held at the Festival location. Fiscal Year 2002-03 Mid-Year Budqet Review The City Manager stated the purpose of the mid-year budget review is to provide a snapshot of the current fiscal year and to discuss any changes and modifications that may need to be made due to unanticipated items. The Director of Finance and Administrative Services stated that all current programs and services in the General Fund will be maintained even if the vehicle license fee funds are taken away by the State. VLF represents approximately $1 million to Cypress. He stated revenues are projected to be approximately $350,000 below the budget. This is a result of vehicle license fees but the City's three top sales tax producers will bring in approximately $650,000 more in revenue. He stated that in general retail the City is down about 4.7% from the previous year. The Director of Finance and Administrative Services stated investment earnings are down due to the current Iow interest rates. He stated expenditures are within budget for the General Fund. He stated the projected Unreserved Fund Balance is approximately $1.4 million. The unreserved undesignated fund balance is projected to be $200,000. This money is available for future budgets or can be used this year in case of revenue shortfalls or as loans to the Redevelopment Agency. The Cypress Recreation and Park District will have an ending Fund Balance of $780,000. A potentially big impact on the Park District is the 2% assessment appeals case, where the County could withhold property tax monies either at the end of this year or the beginning of next year. The Director of Finance and Administrative Services stated the Cypress Redevelopment Agency is within budget in ail areas except for the legal fees relating to the Los Alamitos Race Track and Golf Course Project Area. Staff will be requesting additional appropriations to cover this item. He stated that a big concern for the Redevelopment Agency is the State budget and the Governor's proposal to take away the unencumbered housing funds, which amount to $1.7 million for the City. CITY COUNCIL MINUTES JANUARY 20, 2003 The Director of Finance and Administrative Services stated some of the budget issues impacting the City are: 2% Assessment Appeals Case Board of Equalization Reclassification of Lease Payments Elimination of the 67.5% Vehicle License Tax backfill The Director of Finance and Administrative Services stated the effect of the previous ERAF shift on the City's property tax amounted to the loss of $1 million to the City, $1.2 million to the Cypress Recreation and Park District, and $200,000 for the Lighting District this year. Initial revenue projections for the General Fund for next year are expected to be down 3.6% from the current year. The Park District revenues for operations will grew 5% because they are not affected by the proposed State budget cuts. Fiscal Year 2003-04 budget issues include: 2% Assessment Appeals Case Impact (reduced annual property tax collection) ERAF Shift Proposed for the Redevelopment Agency (approximately $160,000) Cut of 100% of Vehicle License Fee Backfill ($1,755,000) Elimination of Booking Fee Reimbursement ($16,720) Elimination of Traffic Congestion Funding ($163,000) Further ERAF Shifts in Redevelopment (School Pass Through) ($920,000) Reduction of POST Reimbursements for Police Training Deferral of State Mandate Reimbursement Employee Negotiations State and Federal Mandates The Director of Finance and Administrative Services stated one of the issues that needs to be discussed is the Orange County Fire Authority Memorial funding. Mayor Pro Tem Keenan asked about grant monies that have been used to fund positions in the Police Department. The Chief of Police stated the LLEBG and COPS grants are still available to the City. Council Member Sondhi stated she thought a strategic planning process would assist in the evaluation and assessment of what is being done in the City. Council Member McGill provided information on the Orange County Fire Authority firefighter memorial and stated the recommended level of funding is $7,500. Mayor McCoy stated he would like to wait to discuss funding the memorial until after the City knows what impacts the State budget may have. Council Member Sondhi discussed the continued funding to the Orange County Regional Airport Authority. Mayor Pre Tem Keenan stated he feels there is a duplication of effort being made among several groups relating to the airport transportation issues. ORAL COMMUNICATIONS: For Matters Not on the Agenda. None. CITY COUNCIL MINUTES JANUARY 20, 200~64 ITEMS FROM CITY COUNCIL MEMBERS: Mayor Pro Tem Keenan stated he attended meetings hosted by the cities of Anaheim and Placentia for the ranking Democratic Congressman for Transportation and Infrastructure, James Oberstar (Minnesota). ITEMS FROM CITY MANAGER: No items. ADJOURNMENT: Mayor McCoy adjourned the meeting at 6:46 p.m., to Monday, January 27, 2003, beginning at 5:30 p.m. in the Executive Board Room, 5275 Orange Avenue, Cypress, California. ~ ~ ...V~ ~ MAYOR OF THE CITY OF.-C~'PRESS ATTEST: CI)I'Y CLERK OF TR~E C TY OF CYPRESS 4