Minutes 2006-01-30
MINUTES OF AN ADJOURNED REGULAR MEETING OF THE
CYPRESS CITY COUNCIL
HELD
January 30, 2006
The adjourned regular meeting of the Cypress City Council was called to order at 5:33
p.m. by Mayor Sondhi in the Executive Board Room, 5275 Orange Avenue, Cypress,
California.
PRESENT: Council/Agency Board Members McGill, Seymore, Mayor Pro
Tem/Agency Vice Chair Luebben, Mayor/Agency Chair Sondhi
ABSENT: Council/Agency Board Member McCoy
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, Assistant City Engineer, Administrative Services
Manager, Recreation Superintendent, Recreation Supervisor, and City Clerk.
ORAL COMMUNICATIONS:
None.
WORKSHOP SESSION:
The Director of Finance and Administrative Services stated that the purpose of the mid-
year budget review is to update the City Council and bring forward any issues that have
occurred since the budget was adopted in June 2005. He stated that initial projections
will be given for the next year along with a general overview.
He stated that the City's General Fund revenues are estimated to be over $27 million
with projected expenditures and other uses at approximately $24.5 million. He stated
that revenues have increased $2.2 million over the initial budget, made up from sales
tax and ERAF backfill. He stated that sales tax from several businesses located in the
business park have increased revenues for the City and that property tax has increased
slightly over initial projections.
The Director of Finance and Administrative Services stated that investment earnings
have also increased by $340,000 because of rising interest rates. The ERAF backfill for
Motor Vehicle In-Lieu Tax is greater due to the State providing a larger backfill than
initially estimated. The Transient Occupancy Tax amounts are also projected to
increase by approximately $250,000.
Mayor Pro Tem Luebben asked about projections for plan check fees.
The Director of Finance and Administrative Services stated that projected estimates are
not being increased because the new fees will not be effective until March and also
because of a slow down in building.
He stated that General Fund expenditures are projected to be within budget. The
amended budget, that includes supplemental requests approved by the Council such as
Moody Street improvements, signage at the Civic Center, and the restroom/police
evidence storage building, have been included in projections.
The Director of Finance and Administrative Services stated that the General Fund
Balance reflects an increase from operations of $2.7 million and also the anticipated
land sale finalized at the Los Alamitos Race Track that will provide approximately $5
million from the Redevelopment Agency.
CITY COUNCIL MINUTES
JANUARY 30, 2006
He stated that estimated revenues for the Recreation and Park District are $3.8 million
with projected expenditures at $3.6 million. Increased revenues are primarily from
property tax, investment earnings, and park development fees. Possible supplemental
appropriations for this year are the Community Center renovation and field usage study.
The Director of Finance and Administrative Services stated that the Redevelopment
Agency has a promissory note maturing in the amount of $7 million in June. Of this
amount, $2 million will be rolled over in debt and the City will be repaid $5 million.
The Director of Finance and Administrative Services discussed the tax increment
growth, housing set aside, outstanding debt, and fund balance for the Civic Center,
Lincoln Avenue, and Los Alamitos Race Track Project Areas. He stated that the
proceeds for the Redevelopment Housing Fund from the project areas is over $1
million.
He stated that mid-year issues include the economy, storm water enforcement, the
impact oil prices will have on City costs, and purchase of the tennis court/parking lot
land from the Redevelopment Agency. State budget impacts include vehicle license fee
early repayment, ERAF shifts/backfills, and Proposition 42 traffic congestion funding.
Mayor Pro Tem Luebben asked about the timeframe of seeing final results of the study
of long-term infrastructure needs.
The Director of Finance and Administrative Services stated that the studies will provide
an accounting of what the City needs and when, which will be matched with the Capital
Improvement Program. He stated that staff is hopeful the studies will be done within the
next year.
Council Member McGill discussed some of the infrastructure programs the City has put
in place to date.
The Director of Finance and Administrative Services stated that the net effect of the
ERAF shift for the City is over $4 million. He stated that the Recreation and Park District
is hurt more than the City because they do not have many types of revenue.
Council Member McGill asked if the merging of thE~ redevelopment project areas
changed the timeline of paying off the debt.
The Director of Finance and Administrative Services stated that, assuming there are no
additional projects, the Civic Center Project Area will be paid off at a slower rate but the
Lincoln Avenue and Los Alamitos Race Track Project Areas will be paid off faster. With
all three areas combined, the payoff time will be shortened.
The Director of Finance and Administrative Services stated that current City goals are:
encourage retail development and continue to diversify the City's economic base,
improve communication with residents and business, promote and expand the City's
image, continue to implement plans for adequate replacement funds for public facilities
and infrastructure, sustain, enhance, and diversify housing types and affordability,
sustain and enhance public safety, sustain and enhance community programs and
recreational facilities, and foster and encourage participation at the regional level.
He stated that there is not much change anticipated in initial revenue projections for the
next fiscal year with the General Fund expected to grow approximately 5.7%. The main
reasons for growth will be sales tax after a full year 01' Costco, property tax, transient
occupancy tax, investment earnings, and vehicle licenSE! fee/backfill.
The Director of Finance and Administrative Services stated that the City and Recreation
and Park District will be fully funded for the next fiscal year. He stated that the City is in
the process of having an actuary study done for retire!e health cost funding, which is
expected to be approximately $6 million.
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CITY COUNCIL MINUTES
JANUARY 30,2006
The Director of Finance and Administrative Services provided information on the Capital
Improvement Program for the General Fund and Recreation and Park District, including
the upgrading of playground equipment and the Community Center renovation.
He stated that budget issues for the next fiscal year include the ERAF shift and
Proposition 42 Traffic Congestion, the continuing energy crisis, employee labor
negotiations, minimum wage increases, and infrastructure funding.
Council Member McGill thanked staff for their report and work throughout the year on
the budget.
ADJOURNMENT: Mayor Sondhi adjourned the meeting at 6:59 p.m., to Monday,
February 13, 2006, beginning at 5:30 p.m. in the Executive Board Room, 5275 Orange
Avenue, Cypress, California.
ATTEST:
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