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1984 JUN 26 CC MIN• � �> 1 0 MINUTES Of THE ADJOURNED REGULAR MEETING OF THE EL SEGUNDO CITY COUNCIL June 26, 1984 I. CALL TO ORDER The adjourned regular meeting of the E1 Segundo City Council convened on Tuesday, June 26, 1984 at 7:00 p.m., in the Council Chamber of the E1 Segundo City Hall. II. THE PLEDGE OF ALLEGIANCE was led by Mayor Armstrong. III. THE INVOCATION was led by Police Chief J. Clark Devilbiss. IV. RULL CALL Present: Councilmembers Jacobson, Schuldt, Siadek, Synadinos, and Mayor Armstrong Absent: None V. SPECIAL ORDER OF BUSINESS A. Continued Public Hearing on the Proposed Annual Budget for Fiscal Year 1984 -85, and relationship of Revenue Sharing Funds to the Budget Mayor Armstrong welcomed all present to the contin- ued public hearing on the 1984 -85 budget, and then called upon Mr.Kevin Northcraft to continue with the budget presentation. Mr. Northcraft noted that at the June 19 meeting of the Council, the proposed Capital Improvement Program for 1984- 85 had been reviewed, and stated that it would now be appropriate to outline proposed expenditures for the coming year; review the Gann appropriations limit calculations; and discuss potential new revenue sources. Mr. Jose Sanchez announced that since the June 19 meeting, two changes had been made in the Basic and Supplemental budget and the Preliminary Budget Summary. The first change involved revenue estimates. The initial 1984 -85 estimate for sales tax revenues was based on actual sales tax receipts for 1983 -84, which are now known to be 5% higher than anticipated originally. Therefore, the 1984- 85 sales tax estimate has been increased by $150,000, making the total 1984 -85 non - property tax estimate equal to $6,795,000. Councilman Siadek asked whether this addition to anticipated sales tax would reduce the expected shortfall to $750,000; Mr. Sanchez stated that that was correct. Mr. Sanchez reported that the appropriation for the new City Hall photocopy machine, which was approved at a previous Council meeting, had been eliminated because funding was already identified; one additional item not previously funded has been included. The net effect of these two changes is to increase anticipated expenditures by approxi- mately $14,000. Mr. Sanchez then reviewed the Gann appropriations limit calculations: A change factor equal to the product of the percent change in the population and the percent change in the. U.S. Consumer Price Index is applied to the 1983 -84 appropriation limit. For the 1984 -85 fiscal year, the change factor is +6.580; the new Gann appropriations limit would therefore be $19,575,165. IT WAS THEN MOVED by Councilman Jacobson, SECONDED by Councilman Siadek that the following resolution, entitled: RESOLUTION NO. 3266 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF EL SEGUNDO, CALIFORNIA, APPROVING AND ADOPTING THE ANNUAL APPROPRIATIONS LIMIT FOR 1'HE FISCAL YEAR 1984 -85 which was read by City Attorney Volley, be adopted. THE MOTION CARRIED UNANIMOUSLY. Mr. Northcraft next reviewed the four items which it is recommended be supported by revenue sharing funds: (1) Dial -A -Ride Program ($40,853); (2) Juvenile Diversion Program ($53,696); (3) Expansion of the City Library ($367,000); and (4) City business computer system ($300,000)- -for a total of $762,149. No one present wished to address the Council with regard to the proposed use of revenue sharing funds. IT WAS THEN MOVED by Councilman Siadek, SECONDED by Councilman Jacobson, AND UNANIMOUSLY CARRIED that the public hearing on allocation of revenue sharing funds be closed. Mayor Armstrong then asked if anyone present wished to speak with regard to the proposed Capital Im- provement Program. Mr. Dennis Martin, 836 East Grand Avenue, spoke in favor of optimal funding for the City Library expansion, and requested an opportunity to speak again at a later point in the meeting. Mr. Northcraft then stated that the remaining item was consideration of additional revenue sources. Last year, when a significant decline in revenue began, it was recommended that alternative revenue sources be phased in over a three -year period, with a goal of raising $1 million per year to eliminate -2- Council Minutes June 26, 1984 � ti ►� � Ei any deficits, while relying on reserve funds to cover any deficits that might arise during the phase -in period. Mr. Northcraft noted that last year more than 51 million was raised through the business license fee and the transient occcupancy tax. He then described the following revenue alternatives, which were identified for further analysis and recommendation pursuant to Council's direction during the budget study sessions: 1. Utility Users Tax (gas, electricity, telephone and water). This revenue source can be implemented no later than Jaunary 1, 1985. Staff feels this is a strong can- didate for additional revenue. While this tax would impose only a 1% increase in total utility bills for residents and for industry, it is estimated it would yield an additional $1.8 milion in revenue annually. In response to Councilman Siadek's request to explain the justification for such a tax, Mr. Northcraft stated that this is not an uncommon revenue source for cities in the surrounding area. It is easily adjustable to keep pace with inflation, and the cost of calculation and administration is small. He observed that many cities have imposed a rate higher than the 1% figure being pro- posed. 2. Mr. Northcraft reported that the other tax being recommended is the transient parking tax, which would provide for a change in the business registration fee for those busi- nesses involved in the retail occupation of charging for parking. The estimated revenue is $200,000 - $250,000 annually, based on a 15 cent fee per parking space rented. The anticipated date of implementa- tion would be January 1, 1985. 3. The third potential new revenue source is a business registration fee for renting or leasing property for commmercial use. This could be implemented by January 1, 1985. Each .01 cent per square toot levied would generate $40,000 in revenue. 4. The last major revenue source proposed is the removal of the 30 -day exemption from the transient occupancy tax. Councilman Siadek spoke in opposition to the four proposed new revenue sources, and recommended ap- proving the budget without endorsing any of these. He suggested using reserves to fund capital im- provements, which become costlier the longer they are postponed, and to fund any short -term deficits; adjustments could then be made at mid -year accord- ing to the.actual levels of revenue which have been experienced. If the Council insists on bal- ancing the budget through the imposition of new -3- Council Minutes June 26, 1984 revenue sources, Councilman Siadek-recommended examining new fees and charges ratner than taxes. Mayor Armstrong cautioned against viewing the entire reserve fund as being available for general purposes; many of these funds have already been earmarked for specific purposes. he called for a multi -year program so that budget changes would not have to be made piecemeal. In response to an inquiry from Councilman Siadek, Mr. Sanchez stated that an estimated S23 million should be present in reserve acccounts at the beginning of the new fiscal year. Councilman Siadek emphasized his recommendation that reserve funds be spent for capital improvements, since their cost increase percentage is greater than the percent earned by the reserve funds. Councilman Jacobson spoke in favor of maintaining reserve fund levels in order to maximize the amount of interest income which is generated for the general fund. Considerable discussion followed regarding the advisability of drawing down reserves versus implementing new type of taxation. Councilwoman Synadinos emphasized that a sub- stantial portion of the reserve funds are designa- ted for specific uses, e.g., workers' compensation and liability insurance, and are not available for other purposes. She stated that the budget should be balanced, and recommended not delaying capital improvement expenditures. She recommended that the the Capital Improvement Program be funded annually from a designated set of City fees and charges. Councilman Schuldt asked what the capital improve- ment figure for 1985 -86 would be. Mr. Northcraft responded that it would be approximately $950,000- fairly heavy year. It would be possible to defer some portion of this to the following year, which which is a lighter year. Councilman Siadek asked Mr. Worthcraft what the proposed new fees and charges would generate in income. Mr. Northcraft stated that staff had not researched this completely and would require additional guidance from Council. The Mayor recommended that staff prepare a list of dollar amounts which would be generated by various combinations of the potential new revenue sources. Mr. Northcraft stated that it would be helpful to know which alternatives are agreeable to Council prior to beginning work on such a listing. Councilman Siadek spoke in favor of increasing the employee per capita tax rather than imposing a utility user's or other type of new tax. Council- men Jacobson and Schuldt indicated their prefer- ence for a utility user's tax because it would have its principal impact on energy- intensive -4- Council Minutes June 19, 1984 �:b companies which are not so affected by the em- ployee per capita tax. Councilwoman Synadinos spoke in savor of implementing various types of taxes with aitterent effects on ditterent types of businesses so that the burden of generating revenue is distributed as equitably as possible. Mr. John Harden, 420 Sierra Street, suggested that some sort of reserve policy be established. He stated that his company sets as a desired reserve level, the dollar figure required to operate for one year. He also urged funding capital improve- ment projects with reserve tunas in order to avoid additional price increases. At 8:12 p.m., a five- minute recess was declared. At 8:20 p.m., the Council reconvened. Roll was called with the following answering: Present: Councilmembers Jacobson, Schulat, Siadek, Synadinos, and Mayor Armstrong Absent: Councilmembers None Mr. Dennis Martin, 836 East Grand Avenue, pre- sented his June 26 memorandum entitled, "Re- conciliation of Costs and Revenues," and reveiwed four specific proposals "to correct the City budget. " Mrs. Ruth bixler, 733 West Pine, spoke in favor of depositing any budget surplus from a utility user's tax in a fund designated for capital improvements. Mr. Jerry Saunders, 2041 Rosecrans, spoke in opposi- tion to Mr. martin's position, and emphasized the importance of relying upon the coordinating acti- vities of the City Manager and staff. IT WAS THEN MOVED by Councilman Siadek, SECONDED by Councilman Jacobson, AND UNANIMOUSLY CARRIED that the public hearing be closed. In response to a question, City Attorney Dolley stated that there is no legal requirement that the City approve a budget, only that certain financial information be forwarded to the State. Failure to adopt a budget provides no organizing mechanism for making payments for municipal activities and services. Mr. Dolley then outlined the following two alternatives to adopting a specific budget; (1) fund the budget only for a specific period of time, e.y., six months; (2' authorize specific operating expenses from time to time through the resolution process. Councilman Siadek agreed with the Mayor's sugges- tion that specific dollar amounts be computed for certain potential new revenue sources. he urged approval of the budget as proposed, with subsequent development of ways of funding expenditures. -5- Council Minutes June 26, 1984 Following additional discussion, IT WAS MOVED by Councilman Jacobson, SECONDED by Councilman Siadek that the proposed 1984 -85 budget be approved, with the stipulation that if necessary, revenue sources are not in place by January 1, 1985, there be a JUo across - the -board reduction in expenditures. Mr. Dolley then read the following wording a new Section 5 in the previously drafted resolution adopting a budget for the 1984 -85 fiscal year: "In the event that appropriate revenue sources have not been identified or implemented by January 1, 1985, a 10$ across - the -board in all departments decrease in the general operating budget shall be implemented." The tormer Section 5 became new Section 6. This wording was agreed to by the maker and the seconder of the motion. Mr. Dolley then read, by title only, the following resolution: RESOLUTION NO. 3267 A RESOLUTION OF THE CITY COUNCIL OF ThE CITY OF EL SEGUNDO, CALIFORNIA, APPROVING AND ADOPTING AN OPERATING BUDGET FOR ThE r' ISCAL YEAR 1984 -85 adoption of which had been moved and seconded by reference in the motion just above. Councilwoman Synadinos cautioned that it could take serveral months to implement a utility user's tax or other new revenue source; perhaps the January 1, 1985 deadline would not be practicable. Mr. Northcraft requested more specific guidance on what types of additional revenue is desired by Council The Mayor asked whether it would be possible to insure that no company is hit harder by a combina- tion of existing and new forms of taxation than another company. Mr. Northcraft stated he thought that this could be done. Councilman Schuldt then suggested that industry representatives be consulted with regard to possible methods of generating additional revenue. Councilman Jacobson suggested conducting a study session with industry representatives. Councilwoman Synadinos asked what effect the pending motion would have upon supplemental budget items. Councilman Jacobson stated supplemental items would be considered once additional revenue sources had been identified. A vote was then taken, with the following answering: . Ayes: Councilmembers Jacobson, Schuldt, Siadek, Synadinos and Mayor Armstrong Council Minutes June 26, 1984 X 6270 Noes: Councilmembers Nones The following specific questions were identified for additional staff examination and reply: 1. What would be the effect of a utility user's tax on various types of industry? What would the revenue generated be? 2. Regarding the suggested transient parking tax, is the fee 15 cents for every ticket sold? Mr. Sanchez stated that this was correct. The fee would not include em- ployees. 3. It was requested that staff propose a specific figure for the business registra- tion fee. 4. Councilwoman Synadinos requested that consideration be given to eliminating the hotel exemption and lowering the fees. 5. It was requested that specific dollars estimated be calculated for the suggested new fees and charges; Planning Department fees, recreation fees, trailer permit fees, sewer service fees, public facility fees, and refuse collection fees. IT WAS ThEN MOVED by Councilman 5iadek, SECONDED by Councilman Jacobson, that the proposed Capital Improvement budget for 1984 -85 be approved. A vote was then taken, with the following answering: Ayes: Councilmembers Jacobson, Schuldt, Siadek, Synadinos, and Mayor Armstrong Noes: Councilmembers None VI. REPORTS OF OFFICERS A. Director of Public Works 1. Oral report regarding continuing various matters pertaining to information of Sewer Assessment District No. 13, and appropriation of necessary funds Mr. Glickman introduced this continuation of the report on formation of Sewer Assessment District No. 13, noting that all individuals involved are working under tight time con- straints because a significant fee increase will go into effect as of July 1 should the district proceed. Mr. Glickman announced that that day a request had been received from Chevron for the City to advance them the necessary funds to loin the district; additional meetings with affected property owners have also been held. because not all information will be available until -7- Council Minutes June 26, 1984 the following day, Mr. Glickman stated that he would be requesting approval of those funds then known to be required. He then introduced Mr. Gale Pickhart of Robert Rein, William Frost & Associates. Mr. Pickhart distributed maps and a listing of property owners in the proposed district. Of those companies listed, no word has been received trom Prudential, Ernest W. Hahn, and Nu -West, Inc.; one property owner is opposea and will address the Council. The total amount of funds which is being requested for advancement is $898,000; because of some uncertainty on the part of certain property owners, Mr. Pickhart suggested that it would be advisable to increase this amount by approximately 50. Mr. Scott Putnam, an attorney representing Trans Pacific Development Company, which is an agent of LAX businesss center, announced that his client does not choose to partici- pate in the proposed district. He stated his client feels the district will not benefit them, but will be advantageous to those outside the district and to those in- side who anticipate further development. His client feels inclusion in the district is un- lawful and intends to combat its formation legally. He urged the City to take the action necessary to preserve the annexation and connection fees in effect prior to 1984. City Attorney Dolley stated that Council may wish to discuss this in closed session due to the possibility of litigation; Mr. Glickman should be included in this discussion. VII. REPORTS OF COMMITTEES Mayor Armstrong reported that the Noise Abatement Committee had met the previous evening and elected Mr. Steve Storm as Chairman; he will continue for his third year. VIII. REPORTS OF OFFICERS - continued A. City Attorney 1. Consideration of resolution providing guideline for the processing of Development Agreements in the City of E1 Segundo Mr. Dolley noted that in November of 1983, the Council and the Planning Commission held a public meeting at which City staff made a presentation to the Council on the subject of development agreements as authorized under the Government Code. The recommendation made at that time was that the adoption of the enabling resolution permitting development agreements in the City would be an addition Council Minutes June 26, 1984 to the planning tools available to the Council ana the City in the planning area. The resolution being presented is an adapt- ation of the enabling legislation recommended by the League of California Cities In response to questions, Mr. Dolley clarified that the proposed resolution would adopt a process for the consideration of development agreements, not a specific agreement. Councilwoman Synadinos inquired whether such an agreement could change existing ordinances as a precise plan might. Mr. Romaniello stated that a development agreement would not prevent someone from requesting a variance from existing regulations. Councilwoman Synadinos asked whether such an agreement would lock future Councils and City staff members into developments which are not found acceptable several years hence. Mr. Romaniello said that it seems fair that if a development is acceptable today, the developer should be allowed to build the project within a reasonable period of time. Mr. Jerry Saunders, 2041 Rosecrans, spoke in support of the proposed resolution. He asked whether a subsection was missing from Section 17; Mr. Dolley said that a subsection was missing there, and stated that one change needed to be made. Mr. Dolley then presented the subject resolu- tion, which was ready for adoption, entitled: RESOLUTION NO. 3268 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF EL SEGUNDO, CALIFORNIA, ESTABLISHING PROCEDURES AND REQUIRE- MENTS FOR THE CONSIDERATION OF DEVEL- UPMENT AGREEMENTS UNDER GOVERNMENT CODE SECTIONS 65865- 65869.5 which title was read. MOTION WAS MADE by Councilman Siadek, SECONDED by Councilman Schuldt, AND UNANI- MOUSLY CARRIED THAT further reading of the resolution be waived and that it be adopted. VII. UNFINISHED BUSINESS It was agreed that the suggested meeting with industry representatives to discuss potential new revenue sources be scheduled for Tuesday, July 24, 1984 at 9:00 a.m. It was also noted that staff and the City's labor relations consultant need to meet with Council next -9- Council Minutes June 26, 1984 week. It was agreed that the meeting be adjourned to Tuesday, July 3, 1984 at 6:UU p.m. for this purpose. VIII. NEW BUSINESS There was no new business to come before the Council. IX. ORAL COMMUNICATIONS Mr. howard Schmidt, One Space Park, Redondo Beach, an employee of TRW, emphasized that, although TRW is a tenant in the LAX business Center, it has taken no position regarding the formation of the proposed Sewer assessment District No. 13; the position announced to- night by Mr. Putnam was the position of the property owner. X. CLOSED SESSION At 10:38 p.m., the Council recessed into closed session. At 11:10 p.m., the Council reconvened with the following members answering roll: Present: Councilmembers Jacobson, Schuldt, Siadek, Synadinos and Mayor Armstrong Absent: Councilmembers None VI. REPORTS OF OFFICERS - continued A. Director Public Works 1. Ural report regarding continuing various matters pertaining to information of Sewer Assessment District No. 13, and appropriation of necessary funds MOTION MADE by Councilman Siadek, SECONDED by Councilman Jacobson that the City of E1 Segundo make an advancement of funds to Los Angeles County, to sufficiently cover the costs of payment for sewer connection fees of the Sewer Assessment District No. 13 being proposed; and that, (1' the City receive some torm of collateral from each individual parcel involved, in a manner satistactory to both City Council and Public Works, and (2) that if the proposed Sewer District formation is not completed, all funds will be returned to the City by each Company /Parcel involved in transaction. A vote was taken, with the following answering: Ayes: Councilmembers Jacobson, Schuldt, Siadek, Synadinos, and Mayor Armstrong Noes: Councilmembers None _10- Council Minutes June 26, 1984 ,) ") - .Z ... / v X. ADJOURNMENT There being no further business to come before the Council, IT WAS MOVED, SECONDED AND PASSED THAT the meeting be adjourned until Thursday, June 28, 1984 at 9:30 a:m. in the Council Chamber of the City Hall, the hour of adjournment of this meeting being 11:15 p.m. APPROVED: - ( L k-J, , - Charles ri. Armstrong, M yor Respectfully submitted, Valerie A. Hurrowes, City Clerk -11- Council Minutes June 26, 1984 MINUTES OF THE ADJOURNED REGULAR MEETING OF THE EL SEGUNDO CITY COUNCIL June 28, 1984 I. CALL TO ORDER The E1 Segundo City Council convenea in an ao3ournea regular session on Thursday, June 28, 1984 at 9:30 a.m. in the Council Chamber of the E1 Segundo City Hall. The City Clerk reported that a NOTICE OF ADJOURNMENT had been posted as required by law and that a declaration of posting was in her file. II. PLEDGE OF ALLEGIANCE was led by Mayor Armstrong III. ROLL CALL Present: Councilmembers Jacobson, Schuldt, Siadek, Synadinos, and Mayor Armstrong Absent: Councilmembers None IV. The Mayor announced that all interviews for the positions becoming vacant on both the Planning Commission and Recreation and Parks, had been completed. The purpose of the meetinny this morning was to make appointments to each of the three positions. MOTION was made Councilman Siadek, SECONDED by Councilman Jacobson treat William McCaverty be appointed to the position on the Recreation and Parks Commission. The MOTION WAS UNANIMOUSLY ADOPTED. MOTION was made by Councilman Siadek, SECONDED by Councilman Schuldt that the following names be placed in nomination for the Planning Commission: Richard Patterson and harry Schweiger. MOTION was made by Councilman Jacobson, SECONDED by Councilman Siadek that the following names be placed in nomination for the Planning Commission: Scot Uannen and Herbert walsleban. MOTION was made by Councilwoman Synadinos, SECONDED by Councilman Siadek that the following names be placed in nomination for the Planning Commission: Ed Erdley and Richard Wiley. MOTION was made by Councilman Jacobson, SECONDED by Councilman Siadek, and UNANIMOUSLY adopted that nominations be closed. r'ollowing discussion on all persons no,ninated, a roll call vote was taken with each Councilmember casting a total of two votes (one for each position vacant) on the Commission. The followiny persons were UNANIMOUSLY appointed to t_he two positions on said Commission: Herbert Walsleban and Scot Uannen. X bz '(a V. OTHER bUSINE:SS A. The Mayor stated that he has been informed there would be a torthcominy resignation from the Cable Advisory Committee. Following discussion, it was agreed that a Notice be Published inviting applications for said position. VI. ADJOURNMENT No further business appearing to come before the Council at this session, the Mayor declared the meeting adjourned to 6:U0 p.m., Tuesday, July 3, 1984, the hour of adjournment being 10:25 p.m. APPROVED: i arles Armstro Mayor Respectfully submitted, Valerie A. Burrowes, City Clerk -2- Council Minutes June 28, 1984