Minutes 2006-05-31
168
MINUTES OF AN ADJOURNED REGULAH MEETING OF THE
CYPRESS CITY COUNCIL
HELD
May 31,2006
The adjourned regular meeting of the Cypress City Council was called to order at 5:30
p.m. by Mayor Sondhi in the Executive Board Room, 5275 Orange Avenue, Cypress,
California.
Members present:
Mayor/Agency Chair Lydia Sondhi
Mayor Pro Tem/Agency Vice Chair Phil Luebben
Council/Agency Board Member Frank McCoy
Council/Agency Board Member Mike McGill
Council/Agency Board Member Todd Seymore
Others present:
City Manager David Norman
City Attorney William Wynder
Director of Finance and Administrative Services Richard Storey
Chief of Police Rick Hicks
Acting Community Development Director Ted Commerdinger
Public Works Director Doug Dancs
Recreation and Community Services Director Laura Detweiler
Assistant City Engineer Kamran Dadbeh
Administrative Services Manager June Liu
Finance Manager Matt Burton
Recreation and Community Services Superintendent Dena Diggins
Public Works Superintendent Bobby Blackburn
Redevelopment Project Manager Steve Clarke
Contracts/Environmental Affairs Manager Gonzo Vazquez
City Clerk Jill Ingram
Deputy City Clerk Denise Basham
ORAL COMMUNICATIONS:
None.
WORKSHOP SESSION:
Review of Proposed Fiscal Year 2006-2007 Annual Operatinq Budqet:
The Director of Finance and Administrative Services stated that the purpose of the
workshop was to present the proposed budget to the City Council in a general overview
highlighting the major items and to answer any questions of the Council. He stated that
since the agenda was distributed, an adjustment has been made to the staff report
concerning certain personnel changes that were initially included. The position of
Recording Secretary/Deputy City Clerk has been added back keeping the total staff
numbers the same and will be part of the final budget for Council adoption.
The Director of Finance and Administrative Services stated that the budget is part of the
City goals that were previously established. He stated that on June 26, 2006, a public
hearing will be held on the Capital Improvement Program and the budget will be
adopted.
The Finance Manager stated that each year certain assumptions are made, which
include maintaining the general fund balance contingency, approved City goals, the
proposed Capital Improvement Plan, financial restraints of restricted monies,
negotiation impacts, infrastructure needs, and long-term financial stability.
169
CITY COUNCIL MINUTES
MAY 31,2006
He stated that this has been a year of positive revenue growth. The City is anticipating
receiving ERAF monies for the first time in three years, sales tax growth is anticipated
to be very strong, and the general fund is not needed to subsidize the Park District this
upcoming year.
The Finance Manager stated there is a $4.5 million expenditure increase over the
previous year with the bulk of that amount relating to the Capital Improvement Program
and personnel costs representing the majority of the balance. The operating budget
has an increase of 7.4% with staffing levels remaining the same. The General Fund has
an increase of 15.6% with expenditures increasing 2.2%.
He stated that the Recreation and Park District growth is also positive due to ERAF and
higher interest rates on cash balances. The increase in expenditures is primarily a
result of the added service for landscaping, salary increases, and allocation between
the various parks.
The Finance Manager stated that the major component of the Redevelopment Agency
budget is the $9.9 million in debt rollover. He stated that the expenditures exceed the
revenue largely due to the transfer to the CIP fund to help fund the Community Center
renovation.
The Director of Finance and Administrative Services discussed the budget documents
for the City and Recreation and Park District. He stated that revenue projections are
based upon individual revenue source analysis, which includes current revenue
receipts, trends, current development activity, and internal/external analysis. He stated
that revenue changes since the mid-year budget review include increased investment
earnings, projected increased sales tax receipts, and increased Vehicle License Fee
backfill. Revenue impacts that are not included in the budget are State budget
takeaways.
He stated that major revenue assumptions include slower development growth, a
12.9% sales tax receipt growth from the previous budget, a 5% property tax growth
without an ERAF reduction, increased Transient Occupancy Tax and business license
receipts, flat State subventions, and projected investment earnings at 5%. He stated
that future revenue concerns include reduced street and public safety funds, ERAF
taken from the Redevelopment Agency, Proposition 42 Traffic Congestion funds from
the State, business leases that end within the next few years, and mandated costs.
The Director of Finance and Administrative Services stated that personnel changes
include the reclassification of the Management Assistant position to Management
Analyst in the Administration Department and the addition of a Management Analyst
position in the Public Works Department.
He stated that some noteworthy budget items include election costs of approximatel~
$75,000 for actual expenses and staff time, community promotion of the City's 50
Anniversary, a Transient Occupancy Tax audit, shifting one patrol officer to Support
Services, an increase of West-Comm Joint Power Authority costs, landscaping contract
resulting in salary savings, FOG and NPDES inspections, CCTV inspection of sewer
lines, registration software for the Park and Recreation District, Arnold Cypress Park
Pavilion painting, and a field usage study.
The Director of Finance and Administrative Services stated that capital outlay items
included the addition of another electric vehicle, which is AB 2766 funded, and
replacing two marked Police vehicles, four unmarked Police vehicles, one motorcycle,
and one Police administrative vehicle. Capital Improvement Projects include the
Community Center renovation, Lexington extension, storm drain and sewer projects,
and playground equipment upgrades. He stated that Internal Service Funds are fully
funded.
The Director of Finance and Administrative Services discussed infrastructure long term
maintenance and rehabilitation funding and projects.
2
170
CITY COUNCIL MINUTES
MAY 31,2006
He stated that the budget is balanced and that budget growth is consistent with City
goals.
Council Member McCoy asked about last year's funding from the General Fund to the
Park and Recreation District and about landscaping around the Community Center
during the renovation project.
The Director of Finance and Administrative Services stated that $272,000 was allocated
to the Park and Recreation District last year.
The Recreation and Community Services Director stated that monies have been
allocated so that three sides of the Community Center facility will be landscaped.
Council Member Seymore asked about Prop 42 funds for the current and next fiscal
year, and about Measure M funds for the Holder Street bridge.
The Public Works Director stated that $150,000 for Holder Street was placed in the CIP
budget.
Council Member McGill asked about pre-funding for capital projects.
The Director of Finance and Administrative Services stated that the funding is
administratively designated for ongoing and long-term infrastructure needs. The City
expects significant needs will be identified when the Master Plan is completed and
typically sets aside approximately $2 million per year.
Mayor Pro Tem Luebben commended staff on its presentation of the budget and asked
for clarification on Public Works budget items.
The Director of Finance and Administrative Services provided information on the
changes and savings on projects and salaries, and stated that a summary would be
provided in future budget documents.
Mayor Sondhi asked for clarification regarding budget summary and detail documents.
The Finance Manager stated that Internal Service funds are not included in the program
operating budgets because they are charged to other areas.
Mayor Sondhi asked for clarification on the process of budgeting for fiscal year
revenues.
The Director of Finance and Administrative Services stated that a significant part of the
process for revenue sources this year is the State triple flip on sales tax monies and the
shifting of monies from other agencies.
Mayor Sondhi asked that a clarifying paragraph be added regarding major revenue
sources.
Mayor McGill complimented staff on its efforts on finding additional funding sources for
capital improvement projects.
Mayor Sondhi commended staff on its preparation of the budget documents.
Mayor Sondhi asked about the City's policy on publishing employee salaries.
The Director of Finance and Administrative Services stated that salary range positions
are provided but not individual salaries.
The City Attorney stated that the determination to identify specific salary positions and
current incumbent salaries would not be wise in a budget document but that it is
3
171
CITY COUNCIL MINUTES
MAY 31,2006
appropriate to identify position classifications and salary ranges. The two exceptions
are the positions of City Manager and City Attorney.
The City Attorney reported that the City Council would be meeting in Closed Session
regarding Conference with Labor Negotiators, pursuant to Government Code Section
54957.6, Agency negotiators: David Norman, David Belmer, Employee Groups:
Cypress Police Management Association, Cypress Police Officers Association.
The City Attorney also reported that the City Council would be meeting in Closed
Session regarding Public Employee Appointment, pursuant to Government Code
Section 54957, Title: City Clerk.
The City Attorney further reported that the City Council would be meeting in Closed
Session regarding Public Employee Performance Evaluation, pursuant to Government
Code Section 54957, Title: City Manager.
The meeting was recessed to Closed Session at 6:54 p.m.
The meeting was reconvened at 8:28 p.m.
The City Attorney reported that the City Council met in Closed Session regarding
Conference with Labor Negotiators, pursuant to Government Code Section 54957.6,
Agency negotiators: David Norman, David Belmer, Employee Groups: Cypress Police
Management Association, Cypress Police Officers Association. The City Attorney stated
that the Council received additional information in response to its last request and
unanimously directed the City negotiating team to provide a further response to the
current pending offers for the Memorandum of Understanding between the City, its Police
Management Association, and Police Officers Association.
The City Attorney reported that the City Council met in Closed Session regarding Public
Employee Appointment, pursuant to Government Code Section 54957, Title: City Clerk.
The City Attorney stated that the City Council appointed Denise Basham as the Acting
City Clerk effective June 20, 2006.
The City Attorney reported that the City Council met in Closed Session regarding Public
Employee Performance Evaluation, pursuant to Government Code Section 54957, Title:
City Manager. The City Attorney stated that the City Council, by a vote of four votes
aye, no votes nay, and one abstention by Council Member Seymore, have elected to
terminate the contract of the City Manager pursuant to Article II of the contract and
have directed City staff to assure that the former City Manager is provided all severance
benefits afforded to him under the contract. He stated that the former City Manager has
surrendered his keys to City Hall and will make arrangements to return to pick up his
final check and personal belongings. In addition, the City Council unanimously
appointed Richard Storey as the Acting City Manager and directed him to initiate a
search for both the City Manager and City Clerk positions.
ADJOURNMENT: Mayor Sondhi adjourned the meeting at 8:32 p.m., to Monday, June
12, 2006, beginning at 5:30 p.m. in the Executive Board Room, 5275 Orange Avenue,
Cypress, California.
ATTEST:
~fJ~
CITY CLERK OF THE CITY OF CYPRESS
4