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2005 MAY 20 SPECIAL CC MINSPECIAL MEETING MINUTES OF THE EL SEGUNDO CITY COUNCIL FRIDAY, MAY 20, 2005 EMERGENCY OPERATIONS CENTER (EOC) in Police Building 348 Main Street, El Segundo, CA 90245 730A.M — 1030AM 7.30 AM SESSION CALL TO ORDER — Mayor McDowell at 7 35 a.m ROLL CALL Mayor McDowell - Present Mayor Pro Tem Gaines - Absent Council Member Boulgarides - Present Council Member Busch - Present Council Member Jacobson - Present PUBLIC COMMUNICATIONS —(Related to City Business Only — 5 minute limit per person, 30 minute limit total) Individuals who have received value of $50 or more to communicate to the City Council on behalf of another, and employees speaking on behalf of their employer, must so identify themselves poor to addressing the City Council Failure to do so shall be a misdemeanor and punishable by a fine of $250 While all comments are welcome, the Brown Act does not allow Council to take action on any item not on the agenda The Council will respond to comments after Public Communications is closed Chris Powell, El Segundo School Board, spoke regarding School District funds Requested Council consider reinstating the second School Resource Officer and either fund or take over the School Crossing Guard Program Council requested the School Board prioritize their requests. SPECIAL ORDERS OF BUSINESS Preliminary Strategic Planning Session regarding the City's Operating budget for Fiscal Year 2005/2006 A Introduction - Mayor Kelly McDowell, City Manager Mary Strenn and City Manager Designee Jeff Stewart B Background Budget Information - Administrative Services Director Bret Plumlee Historical Graph of Major General Fund Revenue Sources FY 1986 -87 to FY 2005 -06 Budget Assumptions for FY 2005 -2006 - staff presentation. Revenue Estimate Estimate of Expenditure Increases and Offsets Potential General Fund Shortfall Range $500,000 - $1 5 Million Budget Balancing Policy Options - staff presentation 1. Council Direction — Preliminary Council discussion and direction regarding potential budget shortfall or enhancements and means of addressing them, including program reductions in all City departments, staff issues citywide, mterfund transfers, capital improvement project changes, alternate funding of special projects for the budget year of 2005 -06, new and /or increased City department fees and new revenue options. SEE EXHIBIT A Douglas Street Gap Closure Funding — Council directed staff to make every possible effort to fund the project without City funds and prepare options with City funding. Business Summit — Staff to work with Chamber of Commerce to hold a Business Summit, within 10 -15 days, to discuss and obtain comment from businesses Next steps for budget preparation and adoption process - staff presentation Presentation regarding bids received on Douglas Street Protect and preliminary discussion regarding funding of Construction Project and Construction Schedule ADJOURNMENT at 9 30 a m Cindy Moftdsen, City Cletk 2 Exhibit A Budget Balancing Policy Options A Staff's Recommendation regarding a 2 -Year Budget Balancing Plan FY 2005 -2006 and FY 2006 -2007 FY 2005 -2006 Estimated Beginning General Fund budget shortfall of $723,600 (Range likely to be between $500,000 and $1 5 million) 2 Fund Equipment Replacement shortfall of $1,438,100 over next 3 years at $479,400 each year Action: Develop a priority list based on 3-year replacement. Eliminate $500,000 transfer from General Fund to Infrastructure Replacement Fund for next 2 years while Equipment Replacement Fund is being replenished Action: Council deferred decision pending a list of items from staff showing balances on these funds. 4. Pay back $795,000 reimbursement of loan from General Fund to Water fund over next 2 years at $397,500 in FY 2005 -2006 and $397,500 in FY 2006 -2007 based on payment received in FY 2004 -2005 Action: Tentatively plan for one -year reimbursement strategy. Council to finalize decision in July. 5 Use balance in Economic Uncertainty Fund in FY 2005 -2006 and deposit any excess FY 2006 -2007 General Fund savings back into the fund Action: Approved 6. Replenish Liability Insurance fund back up to 70% Confidence Level for an unspecified term at the rate of $200,000 annually Action: Approved 7. If the Council approves the recommendations above, departments to prepare contingency plan to cut $505,500 with contingency plans to cut up to $700,000 Action: Each department will submit a list of cuts in services in the order of theirpriority. B. Items to consider for possible funding: Consider replenishment of Equipment Replacement funding of $1.438 million Action: Develop a priority list based on 3-year replenishment. 2 Consider funding up to $250,000 in Retiree health costs per GASB 45 requirement. Action: Not funded 3 Consider funding up to $250,000 in additional Capital Improvement Projects Action: Additional funding ($250, 000) not needed based on CIPAC recommendation. 4 Consider funding up to $50,000 in Executive Technology Review Committee projects Action: Staff to provide list of any proposed technology projects. C. Budget balancing options: 1 Additional departmental cuts across the board Action: Council did not provide direction to seek across the board cuts. 2, Decrease annual transfer from General Fund to Facilities Maintenance Fund up to $175,000 Action: Staff to prepare list of projects and their balances. 3 Transfer designation in Facilities Maintenance Fund up to $215,000 to the General Fund Action: Staff to prepare list of projects and their balances. 4 Consider paying back $795,000 reimbursement of loan from General Fund to the Water fund based on payment received in FY 2004 -2005. Action: Pay all back in FY '05-'06 5 Consider any new and /or increases in department recommended fees and new revenue Action: Recreation and Parks Director will bring back Rec & Park recommended fee increases for consideration. 6. Consider implementation of Lighting and Landscaping District Action: Not approved 7 Consider prefunding Calpers retirement obligation in FY 2005 -2006. Action: Not approved 19 D. Unfinished Project Account Balances as of May 20, 2005: 1 Community Center $5,945,500 2, City Hall Improvements $819,900 3 Downtown Specific Plan $152,100 4 Aquatics Master Plan $675,750 5 Soccer fields $5,500,000 6 Fire Station # 2 $2,241,300 7 CIP Savings designated first toward Douglas $1,360,350 8 Developer Deposits in Fire, Police, Library $544,650 Doualas Street Project: Continue to meet with the business community to discuss option /s in getting a commitment for additional funding Bring back to Council on June 21 or hold a special meeting, if necessary, to consider status of project Other Action Items: 1. Send Council a list of balances in developer deposits for Police, Fire and Library. 2. Send Council FY '05 -'06 proposed Equipment Replacement Schedule. 3. Send Council the balance in the Infrastructure Replacement Fund. 4. Email Strategic Planning Session PowerPoint presentation. 5. Send Council a list of funded and proposed new technology projects. 6. Send Council a recommendation on what the latest budget shortfall is based on their initial direction and staff's recommendation.