Minutes 2005-01-31
332
MINUTES OF AN ADJOURNED REGULAR MEETING OF THE
CYPRESS CITY COUNCIL
HELD
January 31 , 2005
The adjourned regular meeting of the Cypress City Council was called to order at 5:32
p.m. by Mayor McGill in the Board Room, West Wing of City Hall, 5275 Orange
Avenue, Cypress, California.
PRESENT: Council Members Luebben, McCoy, Seymore, Mayor Pro Tem Sondhi,
Mayor McGill
ABSENT: None
Also present were City Manager, Assistant City Manager, Director of Finance and
Administrative Services, Chief of Police, Public Works Director, Recreation and
Community Services Director, Administrative Services Manager, Assistant City
Engineer, Recreation and Community Services Superintendent, Finance Manager,
Contract/Environmental Affairs Manager, and City Clerk.
ORAL COMMUNICATIONS:
None.
WORKSHOP SESSION:
Fiscal Year 2004-05 Mid-Year Budqet Review
The City Manager stated that the budget review would provide a snapshot of mid-way
through the current budget year, adjustments for items that have occurred since the
budget adoption, a review of the City's goals, expectations for the next budget year, and
long-term planning.
The Director of Finance and Administrative Services stated that expenditures are on
target currently and revenues are ahead for the General Fund. He stated that some of
the reasons for this are the State's backfill for sales tax, backfill for motor vehicle
license fees, increased revenues in business license and development fees, and real
property transfer tax. He stated that revenues decreased in sales tax because of
businesses leaving the city and a reduction in traffic safety fines.
He stated that a growth in the General Fund balance of approximately $1 million is
expected this current year.
Mayor McGill asked about the increased amount in the CIP Fund.
The Director of Finance and Administrative Services stated that an initial amount is
transferred into the fund and the remaining is any carryover from the previous year's
budget.
Council Member Luebben asked about the decrease in traffic safety fines.
The Director of Finance and Administrative Services stated that the number of citations
has increased even though revenues have been decreasing, which more than likely
means that the County is taking a larger amount and the court system is reducing the
fines.
The Director of Finance and Administrative Services stated that the Recreation and
Park District budget is on target for the year. He stated that two areas missed in the
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JANUARY 31,2005
original budget projections are the ERAF shift out of the District, which was expected to
be approximately $175,000 but is higher, and that propelrty tax is higher than expected.
He stated that the Redevelopment Agency revenues often fluctuate. He stated that the
County currently has approximately $250,000 in impounds for the City, which are
assessment value disagreements from property owners. He stated that the tax
increment is growing significantly in all of the project areas.
Council Member Luebben asked if cities will have to worry about the state taking funds
from redevelopment agencies.
The Director of Finance and Administrative Services sta.ted that there is concern by the
state that if redevelopment funds are taken, bond holders will complain so some
protection is provided to governmental agencies. He stated that there will probably be
an ERAF shift every year for many years to come unless there is some significant
revenue increase at the state level.
The Director of Finance and Administrative Services stated that the biggest issue for
the current fiscal year are state impacts. He stated thaI in the early to mid 1990's, the
state began taking a percentage of property tax funds. The Recreation and Park District
and Lighting District have been hardest hit by this actiion. This year, $3.8 million has
been taken from the City, but the state is returning some funds through the ERAF
backfill.
He stated that another issue is the Civic Center renovation and that staff will be coming
back to Council at the next meeting to ask for appropriations to continue with this
project. Currently, approximately $950,000 has been designated for the project. He
stated that the costs of building materials such as concmte and steel increased over the
last year, which meant funds for the interior part of the renovation had to be shifted to
cover the exterior portion of the project.
The meeting was recessed at 6:25 p.m.
The meeting was reconvened at 6:35 p.m.
The Director of Finance and Administrative Services stated that current goals include:
enhance retail development and diversify economic base, promote and expand the
City's image, develop and begin to implement a plan for adequate replacement funds
for public facilities and infrastructure, enhance and diversify housing types and
affordability, maintain and improve public safety, and enhance youth, senior, family, and
community programs and recreational facilities.
Mayor McGill suggested conducting a workshop in the fall for the Council Members to
thoroughly discuss City goals.
Council Member Luebben stated that his highest priority for future goals is replacement
funding for public facilities and infrastructure.
The Director of Finance and Administrative Services stated that based upon initial
projections, the General Fund revenues for fiscal year 2005-2006 will decrease about
1.2 percent. He stated that with Costco coming to the City, an increase in sales tax is
expected but at the same time, the City will show lost revenue from sources in the
business park.
Mayor Pro Tem Sondhi asked if the City is working with Warland and other property
owners to bring in revenue generating entities.
The Assistant City Manager stated that the City is maintaining an on-going dialogue
with Cypress Land and Warland Investment Company, and encourages them to bring in
tenants that will expand the City's economic base. The City is also in contact with
current businesses in an effort for them to keep their business in Cypress.
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JANUARY 31, 2005
The City Manager stated that he and the Assistant City Manager, along with the Mayor,
visit the CEO's of the corporations in the City. He stated that there is an adopted
business retention program.
The Director of Finance and Administrative Services stated that state impacts for next
year's budget include a shift away from the Redevelopment Agency of approximately
$325,000 to $350,000 and an ERAF shift of about $850,000 in addition to the $2.6
million. He stated that this will be another year where the state will defer traffic
congestion funding and the booking fee reimbursement will be eliminated. It is unknown
how much the state budget is going to appropriate for the vehicle license fee and sales
tax backfill and there are concerns about state and fedE~ral mandates.
He stated that the larger employee associations are not coming due for negotiations for
this next fiscal year.
The Director of Finance and Administrative Services stated that infrastructure is a
concern, though not immediately. There will be some significant needs in the area of
capacity and deterioration of pipes in the next 20 years. After the consultant completes
their assessment, the City will be able to focus on setting aside appropriate funding.
He stated that there is not a fee to upgrade the storm drainage so it is important to
continue setting aside funds to correct these needs. He stated that current sewer fees
pay for maintenance and to take care of hot spots.
The Director of Finance and Administrative Services stated that City operations, as a
whole, is considered when preparing the budget each Yl3ar.
He stated that under Proposition 1 A, the state cannot take away funds but they can
borrow funds with the promise of repayment within ten years.
ORAL COMMUNICATIONS:
None.
ITEMS FROM CITY COUNCIL MEMBERS:
Mavor McGill:
Attended a West Orange County Cities Association mHeting. He stated that he would
be attending the meeting regarding aircraft at the Joint Forces Training Base hosted by
the City of Los Alamitos on Thursday, February 3,2005 at 6:00 p.m.
Council Member Luebben:
Attended a League of California Cities meeting whe're an election was held for a
representative to the South Coast Air Quality Management District. Attended an O.C.
Sanitation District Board meeting where Prado Dam was discussed.
Mavor Pro Tem Sondhi:
Attended two Housing and Community Development Committee meetings where
applications and subsidies for affordable housing were discussed and the Public
Housing Authority annual plan draft and five year plan were reviewed.
ITEMS FROM CITY MANAGER:
None.
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CITY COUNCIL MINUTES
JANUARY 31,2005
ADJOURNMENT: Mayor McGill adjourned the meeting at 8:10p.m., to Monday,
February 14, 2005, beginning at 5:30 p.m. in the Executive Board Room, 5275 Orange
Avenue, Cypress, California.
~~
MAYOR OF THE CITY OF CYPRESS
ATTEST:
CLERK OF THE CITY OF CYPRESS
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