RESERVE POLICIES IN CALIFORNIA CITIES
City Financial Reserves, CITY
OF GLENDALE
City Reserve Sources
Reserve Funds, New
York State
Financial Condition Analysis, New York State
Showing posts with label City Financial Statements. Show all posts
Showing posts with label City Financial Statements. Show all posts
Tuesday, March 20, 2012
Literature Articles: City Financial Reserve Policies
ABSTRACT: For
educational and informational purposes, articles on city finance entitled RESERVE
POLICIES IN CALIFORNIA CITIES by Anita Lawrence, Barbara Underwood, Mary
Bradley and City Financial Reserves, CITY
OF GLENDALE, including Fund Balance – General Fund: Survey Cities and Fund
Balance –General Fund Comparisons - % of Budget; Per Capita and City Reserve
Sources and Reserve Funds and Financial Condition Analysis, New York State are
embedded.
Saturday, February 05, 2011
'MINUTES' for Four Noteworthy 1 February 2011 City Council Agenda Items
“MINUTES”
REGULAR CITY COUNCIL MEETING
CITY OF CARMEL-BY-THE-SEA
Tuesday, February 1, 2011
Archived Video Streaming
City Hall
East side of Monte Verde Street between Ocean and Seventh Avenues
V. Announcements from Closed Session, from City Council Members and the City Administrator.
B. Announcements from City Council members (Council members may ask a question for clarification, make a brief announcement or report on his or her activities).
1. Receive Mayor’s Annual Report
(Video 40:10 – 53:45)
State of the City 2011
ACHIEVING COUNCIL OBJECTIVES
January 2011
This eighth Annual Report, prepared by the Mayor and the Vice Mayor, covers calendar year 2010 and thus provides perspective for upcoming work on next year’s budget.
Revenue context for this report: For the Fiscal Year (FY) ending June 30, 2010, the City of Carmel-by-the-Sea had an operating deficit of approximately $155,000, which was covered by monies in our reserves totaling at that time about $9.4 million. Of the City’s top three revenue sources, Property Tax exceeded the previous FY by almost $125,000 and was the top revenue producer, followed by Transient Occupancy Tax (TOT) which exceeded the previous year by about $45,000. In addition, the City was awarded grants of more than $184,000 and received donations of about $55,000. These latter monies, totaling almost $240,000, supplemented revenues in that projects they funded were financed with non-City funds.
For the period July through December of the current FY, as compared to the previous year, Property Tax is up over $175,000. TOT for July through October 2010 is up about $103,000 over the same period last year (receipts for November and December are not yet available). Our third highest revenue producer, Sales Tax, is to date available only for the five month period July through November 2010, and exceeds the same period in the previous year by over $30,000. With the data received to date, there is a welcome up-tick in all three major revenue categories.
Following are the six priority goals established by Council:
1. Explore Fire Department options:
Progress: This exploration has zig-zagged through a variety of options. As was reported in the last Annual Report, we had a Pacific Grove fire chief until they merged with Monterey. Under Monterey’s management, Carmel has continued training with the combined Pacific Grove and Monterey Fire departments. Toward the end of the year, it was clear that a consolidation of the seven Peninsula fire services was not viable. We are now looking at a possible tri-city model (Monterey, Pacific Grove and Carmel) as well as a variety of other options, including retaining our own independent fire department. It is hoped that this will be resolved by the end of March 2011.
2. Manage the City’s challenging financial picture:
Progress: One of the elephants in the room in the expense column is what might be the City’s pay-in and over what period to CalPERS, the state retirement program. We have established an ad hoc Citizens’ Committee to study this issue and report back, as well as answer CalPERS questions raised with each jurisdiction by the January 2011 Civil Grand Jury report.
We continue to budget conservatively, reduce expenses, seek ways to share
services with our neighboring municipalities, obtain grants, and delay projects in order to minimize draws on our reserves. We also look for ways to increase our revenue streams. As recommended in last year’s budget discussions, we will review paid parking as an option, as we have done well with the limited paid parking on the north lot of Sunset and bus parking at the Plaza. Technology that has come on line in the past 10 years offers many new parking management options. Early in the new year, the committee will report on their findings at several workshops and seek public input.
A new agreement has been reached with the Carmel Public Library Foundation, where they will be increasing their fundraising to avoid library staff reductions. At the Sacramento level, the City participated in the effort to pass Prop. 26 that would block the State from raiding fees raised by cities.
3. Concentrate on short-term marketing and economic development:
Progress: Our mantra is “heads on beds”. This translates into short-term events that draw overnight visitors or events that will entice day-trippers to return for a longer stay. New lights for the median on Ocean Avenue are being illuminated until daylight savings time, so that the town looks more inviting at night. We have been fortunate in receiving coverage at no cost to us in national media. The November issue of “Conde Nast Traveler” listed Carmel as one of the 10 places to visit in the U.S.; “Architectural Digest” in January featured a home on Scenic Road, which included photos of our beach and comments on Carmel; a TV program on “Animal Planet” included shots of Carmel; and the radio program “Dining Around with Gene Burns” Saturdays on KGO was broadcast from the Carmel Plaza. The MST free trolley ran its circular route through Carmel during the summer and Christmas holidays.
4. Monitor the storm water run-off program and address requirements for
Areas of Special Biological Significance (ASBS):
Progress: The storm water program was approved in its entirety and execution of the contract with the State is expected shortly. The project is slated to commence in March. Five storms drains were replaced.
5. Plan for the phased renovation of the Forest Theater and develop
funding options:
Progress: We are working with a project manager to phase the work planned for the Forest Theater. ADA improvements would be addressed in the first phase. Sufficient funding is not yet available so that we can bring a specific proposal forward to Council.
6. Implement programs and projects that protect and enhance Carmel
beach:
Progress: The San Antonio walkway from 4th Avenue to the Pebble Beach Carmel Gate was completed in time for the U.S. Open. The North Dunes project (including the boardwalk and new stairs to the beach for improved public access) also has been completed. Two beach rakes were examined and one underwent an extended test of its operation. A final determination on the beach rake’s effectiveness will be made by the Forest and Beach Commission which will make a recommendation to Council. The 13th Avenue seawall foundation and beach stairs were repaired, sand replenishment is ongoing, and the Del Mar project readied for bid. Permanent beach restrooms designed to replace the porta-potties at Santa Lucia and Scenic lack funds and potable water to proceed. Staff continues to work with a contractor to remove charcoal from the beach (3,500 pounds last year).
CAPITAL PROJECTS AND IMPROVEMENTS
1. A new restroom at Scenic and Santa Lucia and the storm water program are discussed above.
2. Street Projects: The Del Mar and Junipero from Ocean to 8th Street
projects were postponed until the spring of 2011 to eliminate any conflict
with the 2010 U.S. Open. Del Mar includes a new and larger underground water tank for non-potable water use, while the Junipero project will resurface and realign the median so that it starts farther north at the crosswalk to make the crossing safer for pedestrians.
OTHER PROJECTS:
1. The “Greening of Carmel”: Carmel has increased its trash recycling
rate from 69% in the previous year to 73% last year. This past year,
Carmel recycled 1,700 pounds of batteries, compared to 1,400 pounds last year. With the City’s ban on polystyrene in place, we are working with the
Waste Management District’s Litter Task Force for a similar County and Peninsula-wide ban on plastic bags. Green building guidelines and incentives are under review by the Planning Commission.
2. Emergency Preparedness: The Police and Fire departments continue to
work cooperatively to improve the functionality of the City’s Emergency
Operations Center (EOC). Emergency preparedness “Quick Guides” are in preparation for publication and distribution to the public. One tabletop exercise was held for key EOC managers. An emergency generator was installed at the Fire Department and another is in design that would service both the Police Department and the Carmel Youth Center (the latter as a possible safe haven).
The Next Generation (NGEN) Radio Project is a countywide effort to replace the old emergency communications infrastructure to ensure reliability and enable interoperability among public safety agencies. A request for proposal has been circulated to vendors for the purchase of the radios.
3. Forest and Beach: For the sixth year, the City has received a Tree City USA Award. Students from various Carmel schools and volunteers from the Church of Latter-day Saints removed approximately 18,000 square feet of non-native plants as part of a beach dunes restoration effort. A grant application is in process to fund landscaping for the south side of Ocean Avenue between Carpenter and Junipero Streets.
4. Water: The cities of the Water District began working together in mid-
2009 to meet the challenge of a new water supply. This effort intensified
dramatically a year later. Since mid-2010, there have been many meetings (sometimes two or three per week resulting in reams of paper) with the six Peninsula mayors and city managers. This culminated in the December 2010 Public Utilities Commission decision to approve the Regional Water Project (desalination in Marina). Peninsula mayors selected the Monterey and Carmel mayors to represent them on the Advisory Committee for the project, which includes CalAm, the Marina Coast Water District, the Monterey County Water Resources Agency and RMC Water. Some of these meetings are out of town and last the better part of a day, so it is clear that this is a significant commitment of resources. This Committee will oversee project funding, testing of wells, construction and placing this desal project into operation around 2014. There are still legal and technical issues that could delay this date.
In closing, these are challenging times. It is too early to tell whether the glimmer of an up-tick early in this FY year will hold. It is also too soon to tell what the impact of changes and reorganizations bruited about in Sacramento will be on local governments. By staying focused and with all of us working with mutual understanding and respect toward our agreed-on goals, we are confident that we will meet these challenges.
Sue McCloud
Mayor
Paula Hazdovac
Vice Mayor
C. Announcements from City Administrator.
1. Present FY 2009-10 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs.
(Video 54:00 – 1:32:30)
Ralph Marcello, Marcello & Company CPAs, presented an overview of the draft audited financial statements. Marcello addressed the economy, city revenues (top three revenue sources - 78% of total city revenue - declined $400,000 or 4% from previous year) and expenditures ($425,000 less than original budget), CalPERS, defined benefit pension plan and fraud prevention. Methods to reduce expenditures with reducing revenues implemented by some governments include 50%:50% cost sharing arrangement for benefits, second tier program for new employees and contract employees for new employees. The auditor’s opinion is an opinion on the reliability of the city’s financial statements, not on the performance of the city or city personnel. The opinion on the City is an “unqualified opinion,” the highest rating.
Mayor McCloud clarified that the City is in the process of studying restructuring the pension plan.
Council Member Ken Talmage expressed concerns about PERS issue; a study stated that in July 2008 retirees health care cost $2.4 million, a liability not on the balance sheet, and suggested $1 million reserve account transfer to trust account. He stated there would have been a $1.1 million deficit if the City spent capital money it should have spent, but the City deferred. He articulated the belief that the City needs $1 million - $1.25 million in more revenues to accomplish deferred capital projects and the city cannot cut expenditures.
Marcello responded that the City has unreserved money designated, not legally committed, including $2.2 million operating reserves, $2.4 million designated for capital improvements and $1 million designated for retirement benefits. He advised that a city can continue to raise TOT to the point people do not come or install parking meters and people will decide to shop elsewhere. He emphazied that he believes we are through the worst part of the recession. He stated that he did not see any “negative aspect” of using part of reserves to supplement the budget, that is why you set it aside during the good years.
City Council Member Burnett asked about the treatment of unfunded CalPERS and other liabilities. Pacific Grove’s estimated CalPERS share of $2 billion was $28 million – $35 million and assumed Carmel’s unfunded liabilities comparable. He stated that CalPERS not adequately addressed in audit.
Marcello responded that there is no reason for the City to be 100% funded. He stated that he expected CalPERS rate of return to be between 2% - 7%. He did not see more information that could be reported and disclosed in the audit.
City Council Member Talmage stated that the City paid $1.55 million to CalPERS last year, spending $1 of $8 - $9 of the City budget to CalPERS and expressed concern about magnitude and growth rate of amounts to CalPERS.
City Council Member Burnett stated he wanted better disclosure and wanted CalPERS numbers in the audit next year in order to get the complete financial picture of the City.
Marcello responded that if the true goal is a complete picture of unfunded liabilities, then there are other unfunded liabilities the City is responsible for; for example, he stated that the Public Works Director probably has a paving maintenance program for all city streets, including estimated age, estimated life remaining and estimated cost to repave streets. Is it prudent to spend money on a study or is it more prudent to spend the money on paving?
Note: The City does not have a Public Works Director.
XI. Orders of Council
A. Receive report, provide policy direction on circulating a Request for Proposal (RFP) for the management and operation of the Children’s Experimental Theater, or ratify the direction provided to the City Administrator at the November 2, 2010 City Council meeting to negotiate a lease with Pacific Repertory Theater.
(Video 2:39:25 – 3:21:00)
City Attorney Don Freeman stated that he recommended the agenda item be placed back on the agenda for RFP or to ratify previous council direction.
City Council Member Ken Talmage expressed concern about whether the City should lease the Indoor Forest Theatre space due to safety issues, ADA accessibility and up-to-date issues.
Mayor McCloud stated that the safety issued has been addressed with the installation of a sprinkler system, it is ADA accessible but not to the extent it should be and therefore "there is no problem on that score."
Mayor McCloud opened the meeting to public comment.
Rebecca Barrymore, President of the Forest Theater Guild Board of Directors, read from a letter written by Herbert Heron about history of Theatre whereby the Forest Theatre is a “true community enterprise.” And the FTG is the “founding community theater group.” She expressed support for their year round Children’s Art Program, Academy of Theatre Arts Program proposal for the Indoor Forest Theatre.
Barbara Brooks, resident, expressed support for PacRep Theatre; she stated Marcia Hovick gave SoDA her “blessing” to continue to operate the Children’s Experimental Theatre (CET).
Megan Terry read a statement from Donna Greenfield regarding FTG and SLAM (Students of Life, Arts and Media) program. Terry argued for FTG’s “historic connection” of community theatre under the aegis of FTG. She stated that historic preservation is not glorifying the past after it has been destroyed.
Adam Moniz, resident, commended the city attorney and city council for bringing the item back onto the agenda to ensure proper procedures are followed.
Bob Mulford, PacRep Theatre Board President, expressed support for PacRep Theatre’s proposal. He stated that PacRep Theatre has already had two events at the Theatre and both events were “sold out.” He stated that the Board is “stable” and “we all contribute.”
Safwat Malek, FTG, expressed concern for inclusivity. FTG does not have a venue and the Inddor Forest Theatre is a good venue for them. He requested that the council look at FTG’s proposal submitted in November 2010.
Jim Bennett, PacRep Theatre’s Director of the Capital Initiative, focused on “duplication of services” and that PacRep had received the “blessing” of Marcia Hovick for SoDA to operate in the Indoor Forest Theatre space. Bennett urged consideration of PacRep’s proposal; PacRep has a reputation and track record for solid training for young people and SoDA is not a professional theatre and it is “community theater.”
Stephen Moorer, PacRep Theatre Executive Director, rebutted certain of FTG’s claims.
Mike Brown, resident and business owner, stated that he felt both groups could share the facility; FTG one half of the year and PacRep one half of the year.
Barbara Livingston, resident, asked whether or not SoDA children could audition for FTG productions.
A father with four children in PacRep past performances, stated that the PacRep instructors are exceptional, they are a tremendous asset to community and they are a community theatre.
Mayor McCloud closed the meeting to public comment.
City Council Member Paula Hazdovac stated that SoDA is a proven program in place, whereas FTG sounds like a new program and therefore she preferred PacRep.
Mayor Sue McCloud stated that she would prefer FTG have a functioning board and a solid financial base.
City Council Member Jason Burnett stated his preference to ratify direction to city administrator and negotiate a lease with PacRep because PacRep is ready to hit the ground running.
City Council Member Talmage stated that he may be a minority of one; he expressed his belief that the most equitable way to proceed is for the City to solicit proposals for fair and open purposes.
City Council Member Karen Sharp stated that she was disappointed that FTG did not appear at the meeting and that did not show “good faith" and money was owed and therefore she favored PacRep.
Assistant City Administrator/City Clerk Heidi Burch stated soliciting proposals would take about two months.
Council Member HAZDOVAC moved to ratify the direction provided by the city administrator at the November 2, 2010 City Council meeting to negotiate a lease with Pacific Repertory Theatre, seconded by Council Member SHARP and carried by the following roll call vote:
AYES: COUNCIL MEMBERS: BURNETT; HAZDOVAC; SHARP; & McCLOUD
NOES: COUNCIL MEMBERS: TALMAGE
ABSENT: COUNCIL MEMBERS: NONE
ABSTAIN: COUNCIL MEMBERS: NONE
D. Approve amendments to City’s revised Harassment Prevention Policy.
Mayor McCloud announced agenda item “pulled to a later date.”
Note: MCW reported, as follows:
“One potential flaw in the new proposal the council might discuss: The city's personnel officer is charged with receiving harassment complaints, but the city has no personnel officer; it has not hired a replacement for Miller since she left her job in 2009.”
Source: News Blog
Carmel Discuss Harassment-Prevention Policies
By Robin.Urevich
January 28, 2011
ADDENDUM:
V. Announcements from Closed Session, from City Council Members and the City Administrator.
C. Announcements from City Administrator.
3. Receive SCC Inc.’s FY 2010-2011 2nd Quarter Financial Report.
Chairman Jim Price stated that SCC’s newly selected managing director, “who will be confirmed within the next couple of weeks,” will be introduced at the March City Council meeting.
Note: Adam Moniz asked what the public aspect of the managing director selection process was, where the job posting was posted, number of resumes received, geographical diversity of applicants and number of people interviewed during Appearances. Post-Appearances, no answers were forthcoming.
REGULAR CITY COUNCIL MEETING
CITY OF CARMEL-BY-THE-SEA
Tuesday, February 1, 2011
Archived Video Streaming
City Hall
East side of Monte Verde Street between Ocean and Seventh Avenues
V. Announcements from Closed Session, from City Council Members and the City Administrator.
B. Announcements from City Council members (Council members may ask a question for clarification, make a brief announcement or report on his or her activities).
1. Receive Mayor’s Annual Report
(Video 40:10 – 53:45)
State of the City 2011
ACHIEVING COUNCIL OBJECTIVES
January 2011
This eighth Annual Report, prepared by the Mayor and the Vice Mayor, covers calendar year 2010 and thus provides perspective for upcoming work on next year’s budget.
Revenue context for this report: For the Fiscal Year (FY) ending June 30, 2010, the City of Carmel-by-the-Sea had an operating deficit of approximately $155,000, which was covered by monies in our reserves totaling at that time about $9.4 million. Of the City’s top three revenue sources, Property Tax exceeded the previous FY by almost $125,000 and was the top revenue producer, followed by Transient Occupancy Tax (TOT) which exceeded the previous year by about $45,000. In addition, the City was awarded grants of more than $184,000 and received donations of about $55,000. These latter monies, totaling almost $240,000, supplemented revenues in that projects they funded were financed with non-City funds.
For the period July through December of the current FY, as compared to the previous year, Property Tax is up over $175,000. TOT for July through October 2010 is up about $103,000 over the same period last year (receipts for November and December are not yet available). Our third highest revenue producer, Sales Tax, is to date available only for the five month period July through November 2010, and exceeds the same period in the previous year by over $30,000. With the data received to date, there is a welcome up-tick in all three major revenue categories.
Following are the six priority goals established by Council:
1. Explore Fire Department options:
Progress: This exploration has zig-zagged through a variety of options. As was reported in the last Annual Report, we had a Pacific Grove fire chief until they merged with Monterey. Under Monterey’s management, Carmel has continued training with the combined Pacific Grove and Monterey Fire departments. Toward the end of the year, it was clear that a consolidation of the seven Peninsula fire services was not viable. We are now looking at a possible tri-city model (Monterey, Pacific Grove and Carmel) as well as a variety of other options, including retaining our own independent fire department. It is hoped that this will be resolved by the end of March 2011.
2. Manage the City’s challenging financial picture:
Progress: One of the elephants in the room in the expense column is what might be the City’s pay-in and over what period to CalPERS, the state retirement program. We have established an ad hoc Citizens’ Committee to study this issue and report back, as well as answer CalPERS questions raised with each jurisdiction by the January 2011 Civil Grand Jury report.
We continue to budget conservatively, reduce expenses, seek ways to share
services with our neighboring municipalities, obtain grants, and delay projects in order to minimize draws on our reserves. We also look for ways to increase our revenue streams. As recommended in last year’s budget discussions, we will review paid parking as an option, as we have done well with the limited paid parking on the north lot of Sunset and bus parking at the Plaza. Technology that has come on line in the past 10 years offers many new parking management options. Early in the new year, the committee will report on their findings at several workshops and seek public input.
A new agreement has been reached with the Carmel Public Library Foundation, where they will be increasing their fundraising to avoid library staff reductions. At the Sacramento level, the City participated in the effort to pass Prop. 26 that would block the State from raiding fees raised by cities.
3. Concentrate on short-term marketing and economic development:
Progress: Our mantra is “heads on beds”. This translates into short-term events that draw overnight visitors or events that will entice day-trippers to return for a longer stay. New lights for the median on Ocean Avenue are being illuminated until daylight savings time, so that the town looks more inviting at night. We have been fortunate in receiving coverage at no cost to us in national media. The November issue of “Conde Nast Traveler” listed Carmel as one of the 10 places to visit in the U.S.; “Architectural Digest” in January featured a home on Scenic Road, which included photos of our beach and comments on Carmel; a TV program on “Animal Planet” included shots of Carmel; and the radio program “Dining Around with Gene Burns” Saturdays on KGO was broadcast from the Carmel Plaza. The MST free trolley ran its circular route through Carmel during the summer and Christmas holidays.
4. Monitor the storm water run-off program and address requirements for
Areas of Special Biological Significance (ASBS):
Progress: The storm water program was approved in its entirety and execution of the contract with the State is expected shortly. The project is slated to commence in March. Five storms drains were replaced.
5. Plan for the phased renovation of the Forest Theater and develop
funding options:
Progress: We are working with a project manager to phase the work planned for the Forest Theater. ADA improvements would be addressed in the first phase. Sufficient funding is not yet available so that we can bring a specific proposal forward to Council.
6. Implement programs and projects that protect and enhance Carmel
beach:
Progress: The San Antonio walkway from 4th Avenue to the Pebble Beach Carmel Gate was completed in time for the U.S. Open. The North Dunes project (including the boardwalk and new stairs to the beach for improved public access) also has been completed. Two beach rakes were examined and one underwent an extended test of its operation. A final determination on the beach rake’s effectiveness will be made by the Forest and Beach Commission which will make a recommendation to Council. The 13th Avenue seawall foundation and beach stairs were repaired, sand replenishment is ongoing, and the Del Mar project readied for bid. Permanent beach restrooms designed to replace the porta-potties at Santa Lucia and Scenic lack funds and potable water to proceed. Staff continues to work with a contractor to remove charcoal from the beach (3,500 pounds last year).
CAPITAL PROJECTS AND IMPROVEMENTS
1. A new restroom at Scenic and Santa Lucia and the storm water program are discussed above.
2. Street Projects: The Del Mar and Junipero from Ocean to 8th Street
projects were postponed until the spring of 2011 to eliminate any conflict
with the 2010 U.S. Open. Del Mar includes a new and larger underground water tank for non-potable water use, while the Junipero project will resurface and realign the median so that it starts farther north at the crosswalk to make the crossing safer for pedestrians.
OTHER PROJECTS:
1. The “Greening of Carmel”: Carmel has increased its trash recycling
rate from 69% in the previous year to 73% last year. This past year,
Carmel recycled 1,700 pounds of batteries, compared to 1,400 pounds last year. With the City’s ban on polystyrene in place, we are working with the
Waste Management District’s Litter Task Force for a similar County and Peninsula-wide ban on plastic bags. Green building guidelines and incentives are under review by the Planning Commission.
2. Emergency Preparedness: The Police and Fire departments continue to
work cooperatively to improve the functionality of the City’s Emergency
Operations Center (EOC). Emergency preparedness “Quick Guides” are in preparation for publication and distribution to the public. One tabletop exercise was held for key EOC managers. An emergency generator was installed at the Fire Department and another is in design that would service both the Police Department and the Carmel Youth Center (the latter as a possible safe haven).
The Next Generation (NGEN) Radio Project is a countywide effort to replace the old emergency communications infrastructure to ensure reliability and enable interoperability among public safety agencies. A request for proposal has been circulated to vendors for the purchase of the radios.
3. Forest and Beach: For the sixth year, the City has received a Tree City USA Award. Students from various Carmel schools and volunteers from the Church of Latter-day Saints removed approximately 18,000 square feet of non-native plants as part of a beach dunes restoration effort. A grant application is in process to fund landscaping for the south side of Ocean Avenue between Carpenter and Junipero Streets.
4. Water: The cities of the Water District began working together in mid-
2009 to meet the challenge of a new water supply. This effort intensified
dramatically a year later. Since mid-2010, there have been many meetings (sometimes two or three per week resulting in reams of paper) with the six Peninsula mayors and city managers. This culminated in the December 2010 Public Utilities Commission decision to approve the Regional Water Project (desalination in Marina). Peninsula mayors selected the Monterey and Carmel mayors to represent them on the Advisory Committee for the project, which includes CalAm, the Marina Coast Water District, the Monterey County Water Resources Agency and RMC Water. Some of these meetings are out of town and last the better part of a day, so it is clear that this is a significant commitment of resources. This Committee will oversee project funding, testing of wells, construction and placing this desal project into operation around 2014. There are still legal and technical issues that could delay this date.
In closing, these are challenging times. It is too early to tell whether the glimmer of an up-tick early in this FY year will hold. It is also too soon to tell what the impact of changes and reorganizations bruited about in Sacramento will be on local governments. By staying focused and with all of us working with mutual understanding and respect toward our agreed-on goals, we are confident that we will meet these challenges.
Sue McCloud
Mayor
Paula Hazdovac
Vice Mayor
C. Announcements from City Administrator.
1. Present FY 2009-10 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs.
(Video 54:00 – 1:32:30)
Ralph Marcello, Marcello & Company CPAs, presented an overview of the draft audited financial statements. Marcello addressed the economy, city revenues (top three revenue sources - 78% of total city revenue - declined $400,000 or 4% from previous year) and expenditures ($425,000 less than original budget), CalPERS, defined benefit pension plan and fraud prevention. Methods to reduce expenditures with reducing revenues implemented by some governments include 50%:50% cost sharing arrangement for benefits, second tier program for new employees and contract employees for new employees. The auditor’s opinion is an opinion on the reliability of the city’s financial statements, not on the performance of the city or city personnel. The opinion on the City is an “unqualified opinion,” the highest rating.
Mayor McCloud clarified that the City is in the process of studying restructuring the pension plan.
Council Member Ken Talmage expressed concerns about PERS issue; a study stated that in July 2008 retirees health care cost $2.4 million, a liability not on the balance sheet, and suggested $1 million reserve account transfer to trust account. He stated there would have been a $1.1 million deficit if the City spent capital money it should have spent, but the City deferred. He articulated the belief that the City needs $1 million - $1.25 million in more revenues to accomplish deferred capital projects and the city cannot cut expenditures.
Marcello responded that the City has unreserved money designated, not legally committed, including $2.2 million operating reserves, $2.4 million designated for capital improvements and $1 million designated for retirement benefits. He advised that a city can continue to raise TOT to the point people do not come or install parking meters and people will decide to shop elsewhere. He emphazied that he believes we are through the worst part of the recession. He stated that he did not see any “negative aspect” of using part of reserves to supplement the budget, that is why you set it aside during the good years.
City Council Member Burnett asked about the treatment of unfunded CalPERS and other liabilities. Pacific Grove’s estimated CalPERS share of $2 billion was $28 million – $35 million and assumed Carmel’s unfunded liabilities comparable. He stated that CalPERS not adequately addressed in audit.
Marcello responded that there is no reason for the City to be 100% funded. He stated that he expected CalPERS rate of return to be between 2% - 7%. He did not see more information that could be reported and disclosed in the audit.
City Council Member Talmage stated that the City paid $1.55 million to CalPERS last year, spending $1 of $8 - $9 of the City budget to CalPERS and expressed concern about magnitude and growth rate of amounts to CalPERS.
City Council Member Burnett stated he wanted better disclosure and wanted CalPERS numbers in the audit next year in order to get the complete financial picture of the City.
Marcello responded that if the true goal is a complete picture of unfunded liabilities, then there are other unfunded liabilities the City is responsible for; for example, he stated that the Public Works Director probably has a paving maintenance program for all city streets, including estimated age, estimated life remaining and estimated cost to repave streets. Is it prudent to spend money on a study or is it more prudent to spend the money on paving?
Note: The City does not have a Public Works Director.
XI. Orders of Council
A. Receive report, provide policy direction on circulating a Request for Proposal (RFP) for the management and operation of the Children’s Experimental Theater, or ratify the direction provided to the City Administrator at the November 2, 2010 City Council meeting to negotiate a lease with Pacific Repertory Theater.
(Video 2:39:25 – 3:21:00)
City Attorney Don Freeman stated that he recommended the agenda item be placed back on the agenda for RFP or to ratify previous council direction.
City Council Member Ken Talmage expressed concern about whether the City should lease the Indoor Forest Theatre space due to safety issues, ADA accessibility and up-to-date issues.
Mayor McCloud stated that the safety issued has been addressed with the installation of a sprinkler system, it is ADA accessible but not to the extent it should be and therefore "there is no problem on that score."
Mayor McCloud opened the meeting to public comment.
Rebecca Barrymore, President of the Forest Theater Guild Board of Directors, read from a letter written by Herbert Heron about history of Theatre whereby the Forest Theatre is a “true community enterprise.” And the FTG is the “founding community theater group.” She expressed support for their year round Children’s Art Program, Academy of Theatre Arts Program proposal for the Indoor Forest Theatre.
Barbara Brooks, resident, expressed support for PacRep Theatre; she stated Marcia Hovick gave SoDA her “blessing” to continue to operate the Children’s Experimental Theatre (CET).
Megan Terry read a statement from Donna Greenfield regarding FTG and SLAM (Students of Life, Arts and Media) program. Terry argued for FTG’s “historic connection” of community theatre under the aegis of FTG. She stated that historic preservation is not glorifying the past after it has been destroyed.
Adam Moniz, resident, commended the city attorney and city council for bringing the item back onto the agenda to ensure proper procedures are followed.
Bob Mulford, PacRep Theatre Board President, expressed support for PacRep Theatre’s proposal. He stated that PacRep Theatre has already had two events at the Theatre and both events were “sold out.” He stated that the Board is “stable” and “we all contribute.”
Safwat Malek, FTG, expressed concern for inclusivity. FTG does not have a venue and the Inddor Forest Theatre is a good venue for them. He requested that the council look at FTG’s proposal submitted in November 2010.
Jim Bennett, PacRep Theatre’s Director of the Capital Initiative, focused on “duplication of services” and that PacRep had received the “blessing” of Marcia Hovick for SoDA to operate in the Indoor Forest Theatre space. Bennett urged consideration of PacRep’s proposal; PacRep has a reputation and track record for solid training for young people and SoDA is not a professional theatre and it is “community theater.”
Stephen Moorer, PacRep Theatre Executive Director, rebutted certain of FTG’s claims.
Mike Brown, resident and business owner, stated that he felt both groups could share the facility; FTG one half of the year and PacRep one half of the year.
Barbara Livingston, resident, asked whether or not SoDA children could audition for FTG productions.
A father with four children in PacRep past performances, stated that the PacRep instructors are exceptional, they are a tremendous asset to community and they are a community theatre.
Mayor McCloud closed the meeting to public comment.
City Council Member Paula Hazdovac stated that SoDA is a proven program in place, whereas FTG sounds like a new program and therefore she preferred PacRep.
Mayor Sue McCloud stated that she would prefer FTG have a functioning board and a solid financial base.
City Council Member Jason Burnett stated his preference to ratify direction to city administrator and negotiate a lease with PacRep because PacRep is ready to hit the ground running.
City Council Member Talmage stated that he may be a minority of one; he expressed his belief that the most equitable way to proceed is for the City to solicit proposals for fair and open purposes.
City Council Member Karen Sharp stated that she was disappointed that FTG did not appear at the meeting and that did not show “good faith" and money was owed and therefore she favored PacRep.
Assistant City Administrator/City Clerk Heidi Burch stated soliciting proposals would take about two months.
Council Member HAZDOVAC moved to ratify the direction provided by the city administrator at the November 2, 2010 City Council meeting to negotiate a lease with Pacific Repertory Theatre, seconded by Council Member SHARP and carried by the following roll call vote:
AYES: COUNCIL MEMBERS: BURNETT; HAZDOVAC; SHARP; & McCLOUD
NOES: COUNCIL MEMBERS: TALMAGE
ABSENT: COUNCIL MEMBERS: NONE
ABSTAIN: COUNCIL MEMBERS: NONE
D. Approve amendments to City’s revised Harassment Prevention Policy.
Mayor McCloud announced agenda item “pulled to a later date.”
Note: MCW reported, as follows:
“One potential flaw in the new proposal the council might discuss: The city's personnel officer is charged with receiving harassment complaints, but the city has no personnel officer; it has not hired a replacement for Miller since she left her job in 2009.”
Source: News Blog
Carmel Discuss Harassment-Prevention Policies
By Robin.Urevich
January 28, 2011
ADDENDUM:
V. Announcements from Closed Session, from City Council Members and the City Administrator.
C. Announcements from City Administrator.
3. Receive SCC Inc.’s FY 2010-2011 2nd Quarter Financial Report.
Chairman Jim Price stated that SCC’s newly selected managing director, “who will be confirmed within the next couple of weeks,” will be introduced at the March City Council meeting.
Note: Adam Moniz asked what the public aspect of the managing director selection process was, where the job posting was posted, number of resumes received, geographical diversity of applicants and number of people interviewed during Appearances. Post-Appearances, no answers were forthcoming.
Saturday, January 01, 2011
Two Noteworthy City Council Agenda Items On & One Noteworthy Agenda Item Not On the 4 January 2011 City Council Agenda
ABSTRACT: Two noteworthy 4 January 2011 City Council Agenda Items, namely Present FY 2009-10 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs and a Resolution entering into a five-year Joint Strategic Plan with the Harrison Memorial Library Board of Trustees and the Carmel Public Library Foundation whereby the Carmel Public Library Foundation will incrementally assume City costs up to $100,000 for part-time library staffing and one noteworthy item not on the agenda, namely PAYGO-like Budgeting, an agenda item submitted by City Council Member Jason Burnett, are presented. Selected excerpts from the Financial Statements, Agenda Item Summary and Staff Report are presented. Additionally, Burnett’s Agenda Item Request is reproduced with link to the document on his web site.
AGENDA PACKET
Regular Meeting
Tuesday, January 4, 2011
4:30 p.m., Open Session
Live and Archived Video Streaming
City Hall
East side of Monte Verde Street between Ocean and Seventh Avenues
V. Announcements from Closed Session, from City Council Members and the City Administrator.
C. Announcements from City Administrator.
1. Present FY 2009-10 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs.
Annual Financial Report
June 30, 2010
MANAGEMENT’S DISCUSSION AND ANALYSIS
FINANCIAL HIGHLIGHTS
The City’s assets exceeded liabilities at June 30, 2010, by $28.5m. The current year change in net assets was a decrease of $740k.
• Of the total net assets, $18.4m was invested in capital assets, net of depreciation and related debt
• $539k was restricted for bond covenants
• As of June 30, 2010, the City’s governmental funds (general fund and special revenue funds) had a combined fund balance of $11m, a decrease of $523k from the previous year. Of the total fund balance, $613k was reserved; $9.1m was designated for capital acquisitions for replacements and future expenditures; and $1.2 was neither reserved nor designated
CHANGE IN NET ASSETS (FY 2009 to FY2010; Total Percent Change)
REVENUE
Program Revenue:
Operating grants and contributions (71%)
General Revenue:
Investment earnings and use of property (50%)
Sales and Use taxes (26%)
Other taxes (20%)
Property tax 3%
TOT 1%
Miscellaneous 266%
Total Revenue (6%)
EXPENSES
Interest on long-term debt (26%)
General government (11%)
Public works (8%)
Public Safety 10%
Total Expenses (1%)
CHANGE IN NET ASSETS $(740)
Net Cost of Services:
The total 2010 costs of $13,152,341 were offset by charges for services $446,853 and grants and contributions of $117,841, bringing the net cost of services down to $12,587,646.
GENERAL FUND BUDGETARY HIGHLIGHTS
Total revenue for the year was $364,702 under budget. The main items contributing to this negative variance were as follows:
Property taxes: $ (329,712)
Use of money and property: $ (102,989)
Business license taxes: $ (55,834)
Franchise fees: $ (35,215)
Sales taxes: $ (20,032)
One of the major revenue sources came in over budget; Transient Occupancy Tax came in $276,432 over budget, which helped offset these other budget shortages.
Total expenditures were under budget by $95,000. The main reasons were that the City had positive expenditure variances related to the savings on capital improvements expenditures that have been postponed, and reduced spending in all departments wherever possible.
GOVERNMENT-WIDE FINANCIAL STATEMENTS
Total Assets: $38,681,265
Total Liabilities: $10,422,534
Total Net Assets: $28,258,731
Total Primary Government
Expenses:$13,152,341
Net (Expense) Revenue and Change in Net Assets: $ (12,587,646)
Note: Operating Grants and Contributions: $117,841
General Revenue:
Property taxes: $4,189,288
Transient occupancy taxes: $3,830,432
Sales and use taxes: $1,619,968
Business license and fees: $625,600
Total General Revenue: $11,847,088
FUND FINANCIAL STATEMENTS
Total Fund Balances – Governmental Funds: $11,031,434
Capital Assets $26,599,340
Long-term Debt Obligations:
Funds Balance Sheet:
Bonds payable – SCC $ (7,680,000)
Total Net Assets – Government-wide Financial Statements: $28,258,731
Notes to Financial Statements
Note 11 – Defined Benefit Pension Plan
Annual Pension Cost
The City’s annual pension cost of $1,545,914 for PERS was equal to the City’s required and actual contributions.
Annual Pension Cost (APC)
FY 6/30/08: $1,419,667
FY 6/30/09: $1,505,897
FY 6/30/10: $1,545,914
Note 14 – Commitments and Contingencies
The City is a member of a joint powers authority that provides emergency ambulance, medical, and rescue services. The agreement renews annually. The other two members are the Carmel Valley Fire Protection District and the Mid-Carmel Valley Fire Protection District. The City contributed $454,381 to the JPA for the year ended June 30, 2010.
Through City Council resolution, and mutual agreement with two nonprofit organizations, the City provides annual support to the Harrison Memorial Library Board of Trustees, and Sunset Cultural Center, Inc., a nonprofit organization. Support for the year ended June 30, 2010 totaled $935,989 and $680,000, respectively.
Note 15 – Dependence upon Tourism Industry
The City’s general fund revenue is strongly dependent on tourism generated tax dollars. For example, in fiscal year 2009-2010, transient occupancy tax (TOT) generated approximately 31% of general fund revenue while sales tax accounted for approximately 13% of general fund revenue.
The tourism industry accounts for all the transient occupancy taxes collected and a significant portion of all sales taxes collected. Consequently, a downturn in the tourism industry for the City would result in a substantial reduction in the general fund revenues. In the event of such a downturn, the City may have insufficient resources in its general fund to pay all of its obligations or provide services at the current level.
REQUIRED SUPPLEMENTAL INFORMATION (unaudited)
Schedule of Funding Progress
Defined Benefit Pension Plan
Year Ended June 30, 2010
CalPERS Cost Sharing Pool
Since the City has less than 100 active members in each plan, it is required by CalPERS to participate in a cost sharing pool...The following valuation reports the activity of the cost sharing pools as a whole, and not the specific activity of individual members such as the City.
Miscellaneous Plan – 2% at 55 Risk Pool (as of June 30, 2009)
Accrued Liabilities (AL): $3,104,798,222
Unfunded Liabilities (UL): $346,287,121
Annual Covered Payroll: $742,981,488
UL as a % of Payroll: 46.7%
Note: UL as a % of Payroll has increased from 33.1% (June 30, 2007) to 33.8% (June 30, 2008) to 46.7% (June 30, 2009)
Safety Plan -3% at 50 Risk Pool
Accrued Liabilities (AL): $9,721,675,347
Unfunded Liabilities (UL): $1,694,516,623
Annual Covered Payroll: $973,814,168
UL as a % of Payroll: 174.0%
Note: UL as a % of Payroll has increased from 139.4% (June 30, 2007) to 135.1% (June 30, 2008) to 174.0% (June 30, 2009)
X. Resolutions
A. Consideration of a Resolution entering into a five-year Joint Strategic Plan with the Harrison Memorial Library Board of Trustees and the Carmel Public Library Foundation whereby the Carmel Public Library Foundation will incrementally assume City costs up to $100,000 for part-time library staffing.
Description: The Harrison Memorial Library Board of Trustees and the Carmel Public Library Foundation propose to enter into a five-year Joint Strategic Plan with the City whereby the Carmel Public Library Foundation will incrementally assume the City’s costs, up to $100,000, for part-time library staffing. The plan will allow the Library to maintain current staffing, hours and services while reducing the amount of the City’s funding for part-time library staff. The plan calls for a partnership between the three entities and consists of specific goals and action steps regarding its implementation. A detailed financial/ fundraising plan for the Carmel Public Library Foundation is included.
Staff Recommendation: Adopt the Resolution.
Important Considerations: If the City adopts the Resolution, it can expect to realize from the Carmel Public Library Foundation the following revenues to offset library staffing costs through Fiscal Year 2014/15:
• FY 2011/12 $60,000
• FY 2012/13 $90,000
• FY 2013/14 $100,000
• FY 2014/15 $100,000
RECOMMENDED MOTION
Adopt the Resolution.
BACKGROUND
The Harrison Memorial Library Board of Trustees and the Carmel Public Library Foundation (CPLF) want to ensure that the Library continues to be an integral part of the community, maintaining current open hours while providing a high level of free public service. The two Boards also recognize that the City of Carmel-by-the Sea faces budget constraints that affect its ability to fully fund all City departments. Therefore, the Board of Trustees and the Carmel Public Library Foundation propose entering into a Joint Strategic Plan with the City that will ensure that their mutual goals for library funding will be met.
The following goals are outlined in the proposed Joint Strategic Plan:
• CPLF will set as its goal the responsibility to provide funds to defray more of the annual costs of library part-time staffing.
• The City will add a footnote which reflects CPLF’s contributions toward Library staff funding under the “Part-Time Assistance” line item on the Library’s Departmental Expenditures page of the City’s adopted budget.
• The City will continue to fund a core staff of eight full-time positions that are critical to running the Library. Note: if the Strategic Plan is adopted by Council, the hiring freeze currently in effect will not apply to the core staff positions.
• The Library Director will investigate the feasibility of reducing the Library’s use of on-call staff while maintaining present services and open hours.
The action steps of the plan state that:
• Beginning Fiscal Year 2011/12, CPLF will contribute 2/3 of the amount needed to offset the projected 10% reduction in part-time library staff and will contribute additional funding thereafter until a funding level of $100,000 is achieved in FY 2014/15.
• Since Library staff cutbacks (and the resulting reductions in service hours) hamper CPLF’s ability to raise funds, during this five-year plan the City’s goal will be to hold Library staff cuts to no more than one 10% reduction, and only if that is absolutely necessary.
• The City, the Library Board, and CPLF will meet at least once before the beginning of each Carmel Public Library Foundation Annual Campaign to discuss ways in which the City and Trustees can assist CPLF with its fundraising efforts.
• The success of the plan depends upon the Carmel Public Library Foundation’s ability to increase contributions from the citizens of Carmel-by-the-Sea and outlying communities. The plan will necessitate CPLF raising enough money to
continue current funding levels for Library programs and services in addition to funding Library staff. If CPLF finds itself unable to fund staff quickly enough, all parties will meet and confer with the aim of finding solutions to the problem before the City takes any action with regard to staffing levels.
STAFF REVIEW
Staff recommends entering into the Joint Strategic Plan as it will be mutually beneficial for all parties involved. The City can reduce the amount spent on the Library while allowing the Library to maintain current open hours and staffing levels, thereby eliminating a situation that could have the potential to negatively affect the Carmel Public Library Foundation’s fundraising efforts.
FISCAL IMPACT
The City can expect to realize the following revenues from the Carmel Public Library Foundation through Fiscal Year 2014/15:
• FY 2011/12: $60,000
• FY 2012/13: $90,000
• FY 2013/14: $100,000
• FY 2014/15: $100,000
SUMMARY
The success of the Joint Strategic Plan depends on the Carmel Public Library
Foundation’s continued ability to raise funds. CPLF’s five-year financial/fundraising strategy is outlined in Attachment “A”. The strategy has been structured conservatively to ensure a realistic chance of success. The Plan was created so that all three parties could participate in a partnership to further the goal of quality Library service to the citizens of Carmel-by-the-Sea and outlying communities.
HARRISON MEMORIAL LIBRARY BOARD OF TRUSTEES, CARMEL PUBLIC LIBRARY FOUNDATION, AND CITY OF CARMEL-BY-THE-SEA JOINT STRATEGIC PLAN
The Harrison Memorial Library Board of Trustees, the Carmel Public Library Foundation and the City of Carmel-by-the-Sea agree that they need to work together in partnership to ensure that the Harrison Memorial Library continues to be an important, integral and vital part of our community. The goal of this partnership will be to sustain the historic tradition of providing free public library service of excellent quality for the residents of the City of Carmel and the Monterey Peninsula. To achieve this goal, the parties need to develop and to agree to a strategic plan.
FIVE-YEAR STRATEGIC PLAN
Acknowledge that the goal of the five-year plan is for the City of Carmel-by-the-Sea to hold steady with regard to library operations for the next five years and for the Carmel Public Library Foundation to incrementally assume the cost of the funding currently being split between the City, the Board of Trustees and CPLF, and eventually increase it to $100,000 per Fiscal Year while still maintaining the library’s quality and level of service.
To accomplish this goal:
• The Carmel Public Library Foundation will set as its goal the responsibility to provide funds to defray more of the annual costs of library part-time staffing, in addition to its current role of funding books, programs, materials and services.
• The City will add a footnote which reflects the Carmel Public Library
Foundation’s contributions toward funding part-time staffing under the “Part-Time Assistance” line item on the Harrison Memorial Library Departmental Expenditures page of the City’s Adopted Budget, currently page E-14. The note will read: “The Carmel Public Library Foundation contributed $________ to this line item. The City’s portion of this same line item is $________.”
• The City will continue to fund a core staff of eight full-time positions that are critical to running the library: Library Director, Circulation Supervisor, Local History Librarian, Youth Services Librarian, Reference Librarian, Technical Services Library Assistant and two Library Assistants.
• The Library Board will direct the Library Director to regularly investigate the feasibility of reducing the library’s use of on-call staff while still maintaining present services and open hours and to propose the steps to make that happen.
Success factor:
The success of this strategic plan depends upon the ability of the Carmel Public Library Foundation to increase its portion of the total annual expenditures for the Library. To do this it must continue to increase the contributions and support it receives not only from citizens of Carmel-by-the-Sea and but also from the greater Carmel library community.
Action steps:
The Carmel Public Library Foundation needs adequate time to achieve its long-term funding goals and the implementation of all the elements in this five-year plan provides that time for a successful transition.
In Fiscal Year 2011/12 the Carmel Public Library Foundation will contribute 2/3 of the amount needed to offset the projected 10% reduction in Library staffing (with the City contributing the other 1/3). The Foundation will, beginning Fiscal Year 2012/13, contribute additional funding for Library staffing each fiscal year until the additional funding level of $100,000 per year is achieved, which will commence Fiscal Year 2014/15 (see Attachment A).
This plan will necessitate the Carmel Public Library Foundation raising enough money to continue to fund library programs, materials and services as well as library staff. Library staff funding needs cannot impact or take away from the above-mentioned programs, materials, and services. If CPLF finds itself in the position of not being able to fund staff quickly enough, the parties will meet and confer with the aim of finding solutions to the problem before the City takes any action with regard to staffing levels.
It is vital to recognize that any library staff reductions - and the resulting reductions in open hours at the Library – are a strong negative factor in the community, hampering the Carmel Public Library Foundation’s ability to raise funds. During this five-year plan, therefore, the City’s goal is to hold library staff cuts to no more than one 10% reduction (and only if that is absolutely necessary) during the time it will take CPLF to accomplish its long term strategy for providing additional funding for library staff.
The Carmel Public Library Foundation needs the full support of all the parties involved to provide assistance in its Annual Campaign fundraising activities. The Carmel Public Library Foundation, the Trustees and the City will meet at least once before the beginning of each CPLF Annual Campaign to discuss ways in which the City and the Trustees can assist the Foundation with its fund-raising efforts.
MAYOR OR CITY COUNCIL
AGENDA ITEM REQUEST
TO: City Administrator
FROM: Jason Burnett
DATE: December 21, 2010
The following item is requested to be put on an upcoming City Council agenda:
TOPIC:
It would be good financial management for the City Council to formalize a policy that any unbudgeted expenses should be combined with offsetting expense cuts or revenues.
This is similar to PAYGO budgeting used in other governments.
MEETING DATE REQUESTED: January 2011
REASONS FOR REQUEST:
Twice at the October City Council meeting and once at the November City Council meeting the City Council considered expense items that were not in the 2010--‐2011 budget. In all three cases the City Council unanimously voted to approve the expense along with a direction to staff to find offsetting expense cuts. The purpose of this action was to keep the net draw from reserves no greater than in the final 2010--‐2011 budget. The aggregate impact of all three items means that the City Council is awaiting staff recommendations for over $100,000 in expense cuts (or unbudgeted revenues) so as to not increase our budgeted draw from reserves.
If the City Council were to approve PAYGO budgeting, staff would be asked to
Present offsetting expense cuts (or revenues) for City Council approval as part of any unbudgeted expense.
If you believe the PAYGO approach to budgeting would be too cumbersome for smaller expenses, we also may want to allow of a small on--‐budget Special Opportunities expense category that could be used to accommodate small, unforeseen expenses without the need to find an offsetting expense cut.
At the December City Council meeting Dewey Evans expressed support for using the PAYGO approach for Carmel.
SUGGESTED BACKUP DATE (if any): February 2011
c: Mayor, Council, and City Clerk
FILED PER COUNCIL POLICY C90--‐07
AGENDA PACKET
Regular Meeting
Tuesday, January 4, 2011
4:30 p.m., Open Session
Live and Archived Video Streaming
City Hall
East side of Monte Verde Street between Ocean and Seventh Avenues
V. Announcements from Closed Session, from City Council Members and the City Administrator.
C. Announcements from City Administrator.
1. Present FY 2009-10 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs.
Annual Financial Report
June 30, 2010
MANAGEMENT’S DISCUSSION AND ANALYSIS
FINANCIAL HIGHLIGHTS
The City’s assets exceeded liabilities at June 30, 2010, by $28.5m. The current year change in net assets was a decrease of $740k.
• Of the total net assets, $18.4m was invested in capital assets, net of depreciation and related debt
• $539k was restricted for bond covenants
• As of June 30, 2010, the City’s governmental funds (general fund and special revenue funds) had a combined fund balance of $11m, a decrease of $523k from the previous year. Of the total fund balance, $613k was reserved; $9.1m was designated for capital acquisitions for replacements and future expenditures; and $1.2 was neither reserved nor designated
CHANGE IN NET ASSETS (FY 2009 to FY2010; Total Percent Change)
REVENUE
Program Revenue:
Operating grants and contributions (71%)
General Revenue:
Investment earnings and use of property (50%)
Sales and Use taxes (26%)
Other taxes (20%)
Property tax 3%
TOT 1%
Miscellaneous 266%
Total Revenue (6%)
EXPENSES
Interest on long-term debt (26%)
General government (11%)
Public works (8%)
Public Safety 10%
Total Expenses (1%)
CHANGE IN NET ASSETS $(740)
Net Cost of Services:
The total 2010 costs of $13,152,341 were offset by charges for services $446,853 and grants and contributions of $117,841, bringing the net cost of services down to $12,587,646.
GENERAL FUND BUDGETARY HIGHLIGHTS
Total revenue for the year was $364,702 under budget. The main items contributing to this negative variance were as follows:
Property taxes: $ (329,712)
Use of money and property: $ (102,989)
Business license taxes: $ (55,834)
Franchise fees: $ (35,215)
Sales taxes: $ (20,032)
One of the major revenue sources came in over budget; Transient Occupancy Tax came in $276,432 over budget, which helped offset these other budget shortages.
Total expenditures were under budget by $95,000. The main reasons were that the City had positive expenditure variances related to the savings on capital improvements expenditures that have been postponed, and reduced spending in all departments wherever possible.
GOVERNMENT-WIDE FINANCIAL STATEMENTS
Total Assets: $38,681,265
Total Liabilities: $10,422,534
Total Net Assets: $28,258,731
Total Primary Government
Expenses:$13,152,341
Net (Expense) Revenue and Change in Net Assets: $ (12,587,646)
Note: Operating Grants and Contributions: $117,841
General Revenue:
Property taxes: $4,189,288
Transient occupancy taxes: $3,830,432
Sales and use taxes: $1,619,968
Business license and fees: $625,600
Total General Revenue: $11,847,088
FUND FINANCIAL STATEMENTS
Total Fund Balances – Governmental Funds: $11,031,434
Capital Assets $26,599,340
Long-term Debt Obligations:
Funds Balance Sheet:
Bonds payable – SCC $ (7,680,000)
Total Net Assets – Government-wide Financial Statements: $28,258,731
Notes to Financial Statements
Note 11 – Defined Benefit Pension Plan
Annual Pension Cost
The City’s annual pension cost of $1,545,914 for PERS was equal to the City’s required and actual contributions.
Annual Pension Cost (APC)
FY 6/30/08: $1,419,667
FY 6/30/09: $1,505,897
FY 6/30/10: $1,545,914
Note 14 – Commitments and Contingencies
The City is a member of a joint powers authority that provides emergency ambulance, medical, and rescue services. The agreement renews annually. The other two members are the Carmel Valley Fire Protection District and the Mid-Carmel Valley Fire Protection District. The City contributed $454,381 to the JPA for the year ended June 30, 2010.
Through City Council resolution, and mutual agreement with two nonprofit organizations, the City provides annual support to the Harrison Memorial Library Board of Trustees, and Sunset Cultural Center, Inc., a nonprofit organization. Support for the year ended June 30, 2010 totaled $935,989 and $680,000, respectively.
Note 15 – Dependence upon Tourism Industry
The City’s general fund revenue is strongly dependent on tourism generated tax dollars. For example, in fiscal year 2009-2010, transient occupancy tax (TOT) generated approximately 31% of general fund revenue while sales tax accounted for approximately 13% of general fund revenue.
The tourism industry accounts for all the transient occupancy taxes collected and a significant portion of all sales taxes collected. Consequently, a downturn in the tourism industry for the City would result in a substantial reduction in the general fund revenues. In the event of such a downturn, the City may have insufficient resources in its general fund to pay all of its obligations or provide services at the current level.
REQUIRED SUPPLEMENTAL INFORMATION (unaudited)
Schedule of Funding Progress
Defined Benefit Pension Plan
Year Ended June 30, 2010
CalPERS Cost Sharing Pool
Since the City has less than 100 active members in each plan, it is required by CalPERS to participate in a cost sharing pool...The following valuation reports the activity of the cost sharing pools as a whole, and not the specific activity of individual members such as the City.
Miscellaneous Plan – 2% at 55 Risk Pool (as of June 30, 2009)
Accrued Liabilities (AL): $3,104,798,222
Unfunded Liabilities (UL): $346,287,121
Annual Covered Payroll: $742,981,488
UL as a % of Payroll: 46.7%
Note: UL as a % of Payroll has increased from 33.1% (June 30, 2007) to 33.8% (June 30, 2008) to 46.7% (June 30, 2009)
Safety Plan -3% at 50 Risk Pool
Accrued Liabilities (AL): $9,721,675,347
Unfunded Liabilities (UL): $1,694,516,623
Annual Covered Payroll: $973,814,168
UL as a % of Payroll: 174.0%
Note: UL as a % of Payroll has increased from 139.4% (June 30, 2007) to 135.1% (June 30, 2008) to 174.0% (June 30, 2009)
X. Resolutions
A. Consideration of a Resolution entering into a five-year Joint Strategic Plan with the Harrison Memorial Library Board of Trustees and the Carmel Public Library Foundation whereby the Carmel Public Library Foundation will incrementally assume City costs up to $100,000 for part-time library staffing.
Description: The Harrison Memorial Library Board of Trustees and the Carmel Public Library Foundation propose to enter into a five-year Joint Strategic Plan with the City whereby the Carmel Public Library Foundation will incrementally assume the City’s costs, up to $100,000, for part-time library staffing. The plan will allow the Library to maintain current staffing, hours and services while reducing the amount of the City’s funding for part-time library staff. The plan calls for a partnership between the three entities and consists of specific goals and action steps regarding its implementation. A detailed financial/ fundraising plan for the Carmel Public Library Foundation is included.
Staff Recommendation: Adopt the Resolution.
Important Considerations: If the City adopts the Resolution, it can expect to realize from the Carmel Public Library Foundation the following revenues to offset library staffing costs through Fiscal Year 2014/15:
• FY 2011/12 $60,000
• FY 2012/13 $90,000
• FY 2013/14 $100,000
• FY 2014/15 $100,000
RECOMMENDED MOTION
Adopt the Resolution.
BACKGROUND
The Harrison Memorial Library Board of Trustees and the Carmel Public Library Foundation (CPLF) want to ensure that the Library continues to be an integral part of the community, maintaining current open hours while providing a high level of free public service. The two Boards also recognize that the City of Carmel-by-the Sea faces budget constraints that affect its ability to fully fund all City departments. Therefore, the Board of Trustees and the Carmel Public Library Foundation propose entering into a Joint Strategic Plan with the City that will ensure that their mutual goals for library funding will be met.
The following goals are outlined in the proposed Joint Strategic Plan:
• CPLF will set as its goal the responsibility to provide funds to defray more of the annual costs of library part-time staffing.
• The City will add a footnote which reflects CPLF’s contributions toward Library staff funding under the “Part-Time Assistance” line item on the Library’s Departmental Expenditures page of the City’s adopted budget.
• The City will continue to fund a core staff of eight full-time positions that are critical to running the Library. Note: if the Strategic Plan is adopted by Council, the hiring freeze currently in effect will not apply to the core staff positions.
• The Library Director will investigate the feasibility of reducing the Library’s use of on-call staff while maintaining present services and open hours.
The action steps of the plan state that:
• Beginning Fiscal Year 2011/12, CPLF will contribute 2/3 of the amount needed to offset the projected 10% reduction in part-time library staff and will contribute additional funding thereafter until a funding level of $100,000 is achieved in FY 2014/15.
• Since Library staff cutbacks (and the resulting reductions in service hours) hamper CPLF’s ability to raise funds, during this five-year plan the City’s goal will be to hold Library staff cuts to no more than one 10% reduction, and only if that is absolutely necessary.
• The City, the Library Board, and CPLF will meet at least once before the beginning of each Carmel Public Library Foundation Annual Campaign to discuss ways in which the City and Trustees can assist CPLF with its fundraising efforts.
• The success of the plan depends upon the Carmel Public Library Foundation’s ability to increase contributions from the citizens of Carmel-by-the-Sea and outlying communities. The plan will necessitate CPLF raising enough money to
continue current funding levels for Library programs and services in addition to funding Library staff. If CPLF finds itself unable to fund staff quickly enough, all parties will meet and confer with the aim of finding solutions to the problem before the City takes any action with regard to staffing levels.
STAFF REVIEW
Staff recommends entering into the Joint Strategic Plan as it will be mutually beneficial for all parties involved. The City can reduce the amount spent on the Library while allowing the Library to maintain current open hours and staffing levels, thereby eliminating a situation that could have the potential to negatively affect the Carmel Public Library Foundation’s fundraising efforts.
FISCAL IMPACT
The City can expect to realize the following revenues from the Carmel Public Library Foundation through Fiscal Year 2014/15:
• FY 2011/12: $60,000
• FY 2012/13: $90,000
• FY 2013/14: $100,000
• FY 2014/15: $100,000
SUMMARY
The success of the Joint Strategic Plan depends on the Carmel Public Library
Foundation’s continued ability to raise funds. CPLF’s five-year financial/fundraising strategy is outlined in Attachment “A”. The strategy has been structured conservatively to ensure a realistic chance of success. The Plan was created so that all three parties could participate in a partnership to further the goal of quality Library service to the citizens of Carmel-by-the-Sea and outlying communities.
HARRISON MEMORIAL LIBRARY BOARD OF TRUSTEES, CARMEL PUBLIC LIBRARY FOUNDATION, AND CITY OF CARMEL-BY-THE-SEA JOINT STRATEGIC PLAN
The Harrison Memorial Library Board of Trustees, the Carmel Public Library Foundation and the City of Carmel-by-the-Sea agree that they need to work together in partnership to ensure that the Harrison Memorial Library continues to be an important, integral and vital part of our community. The goal of this partnership will be to sustain the historic tradition of providing free public library service of excellent quality for the residents of the City of Carmel and the Monterey Peninsula. To achieve this goal, the parties need to develop and to agree to a strategic plan.
FIVE-YEAR STRATEGIC PLAN
Acknowledge that the goal of the five-year plan is for the City of Carmel-by-the-Sea to hold steady with regard to library operations for the next five years and for the Carmel Public Library Foundation to incrementally assume the cost of the funding currently being split between the City, the Board of Trustees and CPLF, and eventually increase it to $100,000 per Fiscal Year while still maintaining the library’s quality and level of service.
To accomplish this goal:
• The Carmel Public Library Foundation will set as its goal the responsibility to provide funds to defray more of the annual costs of library part-time staffing, in addition to its current role of funding books, programs, materials and services.
• The City will add a footnote which reflects the Carmel Public Library
Foundation’s contributions toward funding part-time staffing under the “Part-Time Assistance” line item on the Harrison Memorial Library Departmental Expenditures page of the City’s Adopted Budget, currently page E-14. The note will read: “The Carmel Public Library Foundation contributed $________ to this line item. The City’s portion of this same line item is $________.”
• The City will continue to fund a core staff of eight full-time positions that are critical to running the library: Library Director, Circulation Supervisor, Local History Librarian, Youth Services Librarian, Reference Librarian, Technical Services Library Assistant and two Library Assistants.
• The Library Board will direct the Library Director to regularly investigate the feasibility of reducing the library’s use of on-call staff while still maintaining present services and open hours and to propose the steps to make that happen.
Success factor:
The success of this strategic plan depends upon the ability of the Carmel Public Library Foundation to increase its portion of the total annual expenditures for the Library. To do this it must continue to increase the contributions and support it receives not only from citizens of Carmel-by-the-Sea and but also from the greater Carmel library community.
Action steps:
The Carmel Public Library Foundation needs adequate time to achieve its long-term funding goals and the implementation of all the elements in this five-year plan provides that time for a successful transition.
In Fiscal Year 2011/12 the Carmel Public Library Foundation will contribute 2/3 of the amount needed to offset the projected 10% reduction in Library staffing (with the City contributing the other 1/3). The Foundation will, beginning Fiscal Year 2012/13, contribute additional funding for Library staffing each fiscal year until the additional funding level of $100,000 per year is achieved, which will commence Fiscal Year 2014/15 (see Attachment A).
This plan will necessitate the Carmel Public Library Foundation raising enough money to continue to fund library programs, materials and services as well as library staff. Library staff funding needs cannot impact or take away from the above-mentioned programs, materials, and services. If CPLF finds itself in the position of not being able to fund staff quickly enough, the parties will meet and confer with the aim of finding solutions to the problem before the City takes any action with regard to staffing levels.
It is vital to recognize that any library staff reductions - and the resulting reductions in open hours at the Library – are a strong negative factor in the community, hampering the Carmel Public Library Foundation’s ability to raise funds. During this five-year plan, therefore, the City’s goal is to hold library staff cuts to no more than one 10% reduction (and only if that is absolutely necessary) during the time it will take CPLF to accomplish its long term strategy for providing additional funding for library staff.
The Carmel Public Library Foundation needs the full support of all the parties involved to provide assistance in its Annual Campaign fundraising activities. The Carmel Public Library Foundation, the Trustees and the City will meet at least once before the beginning of each CPLF Annual Campaign to discuss ways in which the City and the Trustees can assist the Foundation with its fund-raising efforts.
MAYOR OR CITY COUNCIL
AGENDA ITEM REQUEST
TO: City Administrator
FROM: Jason Burnett
DATE: December 21, 2010
The following item is requested to be put on an upcoming City Council agenda:
TOPIC:
It would be good financial management for the City Council to formalize a policy that any unbudgeted expenses should be combined with offsetting expense cuts or revenues.
This is similar to PAYGO budgeting used in other governments.
MEETING DATE REQUESTED: January 2011
REASONS FOR REQUEST:
Twice at the October City Council meeting and once at the November City Council meeting the City Council considered expense items that were not in the 2010--‐2011 budget. In all three cases the City Council unanimously voted to approve the expense along with a direction to staff to find offsetting expense cuts. The purpose of this action was to keep the net draw from reserves no greater than in the final 2010--‐2011 budget. The aggregate impact of all three items means that the City Council is awaiting staff recommendations for over $100,000 in expense cuts (or unbudgeted revenues) so as to not increase our budgeted draw from reserves.
If the City Council were to approve PAYGO budgeting, staff would be asked to
Present offsetting expense cuts (or revenues) for City Council approval as part of any unbudgeted expense.
If you believe the PAYGO approach to budgeting would be too cumbersome for smaller expenses, we also may want to allow of a small on--‐budget Special Opportunities expense category that could be used to accommodate small, unforeseen expenses without the need to find an offsetting expense cut.
At the December City Council meeting Dewey Evans expressed support for using the PAYGO approach for Carmel.
SUGGESTED BACKUP DATE (if any): February 2011
c: Mayor, Council, and City Clerk
FILED PER COUNCIL POLICY C90--‐07
Sunday, December 05, 2010
Three Noteworthy 7 December 2010 City Council Agenda Items
ABSTRACT: Three Noteworthy 7 December 2010 City Council Agenda Items, namely Receive City’s Year-End and First Quarter 2010-2011 financial reports, Present FY 2009-10 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs and Receive report and provide policy direction on extending the shared fire services agreement for 30 days, are presented. Excerpts from Agenda Item Summary, Staff Report, AGREEMENT TO PROVIDE INTERIM FIRE ADMINISTRATION AND EMERGENCY INCIDENT MANAGEMENT SERVICES BETWEEN THE CITIES OF MONTEREY AND CARMEL-BY-THE-SEA, Amendment to Agreement to Provide Limited Fire Services between the Cities of Monterey and Carmel-By-The-Sea and Amendment #2 to Agreement to Provide Interim Fire Administration and Emergency Incident Management Services between the Cities of Monterey and Carmel-By-The-Sea are provided.
AGENDA PACKET
Regular Meeting
Tuesday, December 7, 2010
4:30 p.m., Open Session
Live & Archived Video Streaming
City Hall
East side of Monte Verde Street between Ocean and Seventh Avenues
V. Announcements from Closed Session, from City Council Members and the City Administrator.
C. Announcements from City Administrator
1. Receive City’s Year-End and First Quarter 2010-2011 financial reports.
2. Present FY 2009-10 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs.
XI. Orders of Council
A. Receive report and provide policy direction on extending the shared fire services agreement for 30 days.
Description: In December 2008, Council directed staff to review alternatives of providing fire services. Over the past several months, separate meetings were held with both CAL FIRE and Monterey/Pacific Grove fire departments to review all possible alternatives. There also was a period of time when all agencies were evaluating the creation of a Joint Powers Authority to provide Peninsula-wide shared fire services, however, this effort has encountered some difficulties, mostly related to risk management. Thus, staff’s efforts have refocused on developing a contractual relationship with an outside fire agency.
Staff has now formally requested a mutually agreeable, 30-day extension of the Monterey/Pacific Grove shared fire services agreement. It is recommended that the extension not go beyond January 31, 2011.
Overall Cost: The monthly payment for the current services provided by Monterey/Pacific Grove is $13,500 per month. This amount will remain the same during the 30-day contract extension period.
Staff Recommendation: Review the report and provide direction.
Important Considerations: Before the January 31, 2011 extension with Monterey/Pacific Grove ends, a comprehensive draft report will be presented at a Council workshop, the focus of which will be a review of various shared fire services alternatives. Staff will ask the Council some time before the end of January to decide which fire services alternative will best serve the City and to direct staff to prepare the appropriate agreements to implement that decision.
RECOMMENDATION
The agreement allows for an extension of the agreement by mutual consent of both parties. No City Council action is necessary at this time.
STAFF REVIEW
Staff has formally requested a 30-day extension on the Monterey/Pacific Grove shared fire services agreement. Staff is completing the draft report and accompanying PowerPoint presentation. It is recommended that the extension not go beyond January 31, 2011.
Prior to the end of this extension, a Council workshop will be held to review the various shared fire services alternatives. At some point before January 31st, staff will ask the Council to make a decision on which fire services alternative will best serve the City and thus, direct staff to prepare the appropriate agreements to implement that decision.
SUMMARY
A draft comprehensive report is being completed and will be presented at an upcoming Council workshop.
AGREEMENT TO PROVIDE INTERIM FIRE ADMINISTRATION AND EMERGENCY INCIDENT MANAGEMENT SERVICES BETWEEN THE CITIES OF MONTEREY AND CARMEL-BY-THE-SEA
THIS AGREEMENT, made and executed this day of December 3, 2008 by and between the CITY OF MONTEREY, a municipal corporation, herein after referred to as “Monterey,” and the CITY OF CARMEL-BY-THE-SEA, a municipal corporation, herein after referred to as “Carmel” (collectively referred to as “the Parties), ...
ARTICLE I
TERM OF AGREEMENT
1.1 Initial Term. The term of this Agreement shall be from 12:00 midnight on December 15, 2009 through 11:59 p.m. on February 28, 2009.
1.2 Extension of Term. This Agreement may be extended by mutual agreement of the Parties conditioned upon joint commitment and good faith effort to develop and execute a successor agreement for full fire department services.
ARTICLE III
DUTIES OF CARMEL UNDER THIS AGREEMENT
3.1 Payment for Fire Services. Carmel agrees to compensate Monterey for all services provided pursuant to the terms and conditions of this Agreement as follows:
(a) $11,250.00 per calendar month, prorated at $375.00 per day, or any portion of a day, for services provided during any partial calendar month.
ADOPTED BY:
CITY OF CARMEL-BY-THE-SEA, A Municipal Corporation
By: Rich Guillen, City Administrator
Date: 12/31/08
CITY OF MONTEREY, A Municipal Corporation
By: Fred Meurer, City Manager
Date: 1/20/09
Amendment to Agreement to Provide Limited Fire Services between the Cities of Monterey and Carmel-By-The-Sea
ARTICLE I
TERM OF AGREEMENT
1.2 Extension of Term. The term of this Agreement is hereby amended to expire at 12:00 midnight on January 31, 2010.
ARTICLE III
DUTIES OF CARMEL UNDER THIS AGREEMENT
3.1 Payment for Fire Services. Carmel agrees to compensate Monterey for all services provided pursuant to the terms and conditions of this Agreement as follows:
(a) Effective July 1, 2009, $13,500.00 per calendar month, prorated at $450.00 per day or any portion of a day, for services provided during any partial calendar month.
ADOPTED BY:
CITY OF CARMEL-BY-THE-SEA, A Municipal Corporation
By: Rich Guillen, City Administrator
Date: 7-8-09
CITY OF MONTEREY, A Municipal Corporation
By: Fred Meurer, City Manager
Date: 7/26/09
Amendment #2 to Agreement to Provide Interim Fire Administration and Emergency Incident Management Services between the Cities of Monterey and Carmel-By-The-Sea
ARTICLE I
TERM OR AGREEMENT
1.2 Extension of Term. The term of this Agreement is hereby amended to expire at 12:00 midnight on December 31, 2010. The term of this Agreement may be further extended by mutual agreement of the Parties conditioned upon joint commitment and good faith effort to develop and execute a successor agreement for full fire department services.
All other remaining terms and conditions of the Agreement not specifically amended herein shall remain unchanged.
ADOPTED BY:
CITY OF CARMEL-BY-THE-SEA. A Municipal Corporation
By: Rich Guillen, City Administrator
Date: 1-25-10
CITY OF MONTEREY, A Municipal Corporation
By: Fred Meurer, City Manager
Date: 2-2-10
AGENDA PACKET
Regular Meeting
Tuesday, December 7, 2010
4:30 p.m., Open Session
Live & Archived Video Streaming
City Hall
East side of Monte Verde Street between Ocean and Seventh Avenues
V. Announcements from Closed Session, from City Council Members and the City Administrator.
C. Announcements from City Administrator
1. Receive City’s Year-End and First Quarter 2010-2011 financial reports.
2. Present FY 2009-10 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs.
XI. Orders of Council
A. Receive report and provide policy direction on extending the shared fire services agreement for 30 days.
Description: In December 2008, Council directed staff to review alternatives of providing fire services. Over the past several months, separate meetings were held with both CAL FIRE and Monterey/Pacific Grove fire departments to review all possible alternatives. There also was a period of time when all agencies were evaluating the creation of a Joint Powers Authority to provide Peninsula-wide shared fire services, however, this effort has encountered some difficulties, mostly related to risk management. Thus, staff’s efforts have refocused on developing a contractual relationship with an outside fire agency.
Staff has now formally requested a mutually agreeable, 30-day extension of the Monterey/Pacific Grove shared fire services agreement. It is recommended that the extension not go beyond January 31, 2011.
Overall Cost: The monthly payment for the current services provided by Monterey/Pacific Grove is $13,500 per month. This amount will remain the same during the 30-day contract extension period.
Staff Recommendation: Review the report and provide direction.
Important Considerations: Before the January 31, 2011 extension with Monterey/Pacific Grove ends, a comprehensive draft report will be presented at a Council workshop, the focus of which will be a review of various shared fire services alternatives. Staff will ask the Council some time before the end of January to decide which fire services alternative will best serve the City and to direct staff to prepare the appropriate agreements to implement that decision.
RECOMMENDATION
The agreement allows for an extension of the agreement by mutual consent of both parties. No City Council action is necessary at this time.
STAFF REVIEW
Staff has formally requested a 30-day extension on the Monterey/Pacific Grove shared fire services agreement. Staff is completing the draft report and accompanying PowerPoint presentation. It is recommended that the extension not go beyond January 31, 2011.
Prior to the end of this extension, a Council workshop will be held to review the various shared fire services alternatives. At some point before January 31st, staff will ask the Council to make a decision on which fire services alternative will best serve the City and thus, direct staff to prepare the appropriate agreements to implement that decision.
SUMMARY
A draft comprehensive report is being completed and will be presented at an upcoming Council workshop.
AGREEMENT TO PROVIDE INTERIM FIRE ADMINISTRATION AND EMERGENCY INCIDENT MANAGEMENT SERVICES BETWEEN THE CITIES OF MONTEREY AND CARMEL-BY-THE-SEA
THIS AGREEMENT, made and executed this day of December 3, 2008 by and between the CITY OF MONTEREY, a municipal corporation, herein after referred to as “Monterey,” and the CITY OF CARMEL-BY-THE-SEA, a municipal corporation, herein after referred to as “Carmel” (collectively referred to as “the Parties), ...
ARTICLE I
TERM OF AGREEMENT
1.1 Initial Term. The term of this Agreement shall be from 12:00 midnight on December 15, 2009 through 11:59 p.m. on February 28, 2009.
1.2 Extension of Term. This Agreement may be extended by mutual agreement of the Parties conditioned upon joint commitment and good faith effort to develop and execute a successor agreement for full fire department services.
ARTICLE III
DUTIES OF CARMEL UNDER THIS AGREEMENT
3.1 Payment for Fire Services. Carmel agrees to compensate Monterey for all services provided pursuant to the terms and conditions of this Agreement as follows:
(a) $11,250.00 per calendar month, prorated at $375.00 per day, or any portion of a day, for services provided during any partial calendar month.
ADOPTED BY:
CITY OF CARMEL-BY-THE-SEA, A Municipal Corporation
By: Rich Guillen, City Administrator
Date: 12/31/08
CITY OF MONTEREY, A Municipal Corporation
By: Fred Meurer, City Manager
Date: 1/20/09
Amendment to Agreement to Provide Limited Fire Services between the Cities of Monterey and Carmel-By-The-Sea
ARTICLE I
TERM OF AGREEMENT
1.2 Extension of Term. The term of this Agreement is hereby amended to expire at 12:00 midnight on January 31, 2010.
ARTICLE III
DUTIES OF CARMEL UNDER THIS AGREEMENT
3.1 Payment for Fire Services. Carmel agrees to compensate Monterey for all services provided pursuant to the terms and conditions of this Agreement as follows:
(a) Effective July 1, 2009, $13,500.00 per calendar month, prorated at $450.00 per day or any portion of a day, for services provided during any partial calendar month.
ADOPTED BY:
CITY OF CARMEL-BY-THE-SEA, A Municipal Corporation
By: Rich Guillen, City Administrator
Date: 7-8-09
CITY OF MONTEREY, A Municipal Corporation
By: Fred Meurer, City Manager
Date: 7/26/09
Amendment #2 to Agreement to Provide Interim Fire Administration and Emergency Incident Management Services between the Cities of Monterey and Carmel-By-The-Sea
ARTICLE I
TERM OR AGREEMENT
1.2 Extension of Term. The term of this Agreement is hereby amended to expire at 12:00 midnight on December 31, 2010. The term of this Agreement may be further extended by mutual agreement of the Parties conditioned upon joint commitment and good faith effort to develop and execute a successor agreement for full fire department services.
All other remaining terms and conditions of the Agreement not specifically amended herein shall remain unchanged.
ADOPTED BY:
CITY OF CARMEL-BY-THE-SEA. A Municipal Corporation
By: Rich Guillen, City Administrator
Date: 1-25-10
CITY OF MONTEREY, A Municipal Corporation
By: Fred Meurer, City Manager
Date: 2-2-10
Wednesday, December 02, 2009
‘MINUTES’ for Two Noteworthy 1 December 2009 City Council Agenda Items
“MINUTES”
CITY COUNCIL MEETING
CITY OF CARMEL-BY-THE-SEA
November 3, 2009
V. Announcements from Closed Session, from City Council Members and the City Administrator.
C. Announcements from City Administrator
1. Present FY 2008-09 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs.
Ralph Marcello, MARCELLO & COMPANY, Certified Public Accountants, presented the highlights of the FY 2008-09 Draft Audited Financial Statements. With regard to the big three revenue sources (transient occupancy tax, property tax and sales tax), revenues increased by 4% in 2005, 9%, in 2006, 7% in 2007, 5% in 2008 and decreased 6% in 2009. General Revenues, which the city has total discretion over, and are contingent on general economic conditions, was +12% in 2008 and -9% in 2009.
During these economic times, other cities have engaged in hiring contract employees for one year without benefits, cross-train employees for vacant position responsibilities, reduce public safety workers, review pension system and furloughs.
Ralph Marcello’s presented his company’s Audit Opinion, an “unqualified opinion,” the highest type of opinion. And compared to other cities Carmel-by-the-Sea is in “very good economic health” mainly because of its policy to set aside reserves in good economic times.
X. Resolutions
A. Consideration of a Resolution authorizing participation in an Initial Exploration and Analysis of Joint Fire Service Options.
City Administrator Rich Guillen presented the Staff Report.
Mayor McCloud opened the meeting to public comment.
Carolyn Hardy requested the City include the three special fire districts and Cal Fire for consideration as to fire protection services for Carmel-by-the-Sea.
Mayor McCloud interjected and stated that the Mayor of Monterey would recommend the City of Monterey extend the interim fire services contract with Carmel-by-the-Sea through June 2010.
Barbara Livingston (remarks read by Kathy Frederickson) requested the City consider all options, including stand alone and Cal Fire. George Haines, Fire Chief of Cypress, Carmel Highlands and Pebble Beach Fire Department spoke in support of the resolution.
Mayor McCloud closed the meeting to public comment.
Council Member TALMAGE moved adoption of the Resolution with the addition that the Staff bring back to Council current information on all viable options, including JPA, shared services and stand alone fire department, seconded by Council Member ROSE, and carried unanimously.
NOTE: During Appearances, Carolyn Hardy applauded the City for approaching Cal Fire for the purpose of requesting a proposal for Fire Services from Cal Fire (Information gleaned from the September 2009 Minutes of the Pebble Beach Community Service District Board Meeting) and requested the City share the proposal with the public.
REFERENCE:
PEBBLE BEACH COMMUNITY SERVICES DISTRICT
BOARD OF DIRECTORS
Regular Meeting of September 25, 2009
MINUTES
Chief Haines stated that the City of Carmel would be sending CAL FIRE a formal request for proposal for fire protection services. Charlotte Townsend indicated she was a Director of the Carmel Residents Association which supports the City of Carmel in its consideration of CAL FIRE.
COMMENT:
• While Mayor Sue McCloud recently stated that the City is interested in looking at the concept of a regional fire department, and “would probably be derelict if we didn’t,” in the context of the Final Report of The Fire Department Consolidation Feasibility Analysis for the Cities of Monterey, Pacific Grove and Carmel completed by Citygate Associates, LLC in June 2007 and Carmel-by-the-Sea’s formal withdrawl from negotiations with Monterey and Pacific Grove in January 2008, it is derelict of the City of Carmel-by-the-Sea to not have studied and reviewed all viable fire protection service options and implemented a permanent fire protection service solution for the City of Carmel-by-the-Sea long before now.
CITY COUNCIL MEETING
CITY OF CARMEL-BY-THE-SEA
November 3, 2009
V. Announcements from Closed Session, from City Council Members and the City Administrator.
C. Announcements from City Administrator
1. Present FY 2008-09 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs.
Ralph Marcello, MARCELLO & COMPANY, Certified Public Accountants, presented the highlights of the FY 2008-09 Draft Audited Financial Statements. With regard to the big three revenue sources (transient occupancy tax, property tax and sales tax), revenues increased by 4% in 2005, 9%, in 2006, 7% in 2007, 5% in 2008 and decreased 6% in 2009. General Revenues, which the city has total discretion over, and are contingent on general economic conditions, was +12% in 2008 and -9% in 2009.
During these economic times, other cities have engaged in hiring contract employees for one year without benefits, cross-train employees for vacant position responsibilities, reduce public safety workers, review pension system and furloughs.
Ralph Marcello’s presented his company’s Audit Opinion, an “unqualified opinion,” the highest type of opinion. And compared to other cities Carmel-by-the-Sea is in “very good economic health” mainly because of its policy to set aside reserves in good economic times.
X. Resolutions
A. Consideration of a Resolution authorizing participation in an Initial Exploration and Analysis of Joint Fire Service Options.
City Administrator Rich Guillen presented the Staff Report.
Mayor McCloud opened the meeting to public comment.
Carolyn Hardy requested the City include the three special fire districts and Cal Fire for consideration as to fire protection services for Carmel-by-the-Sea.
Mayor McCloud interjected and stated that the Mayor of Monterey would recommend the City of Monterey extend the interim fire services contract with Carmel-by-the-Sea through June 2010.
Barbara Livingston (remarks read by Kathy Frederickson) requested the City consider all options, including stand alone and Cal Fire. George Haines, Fire Chief of Cypress, Carmel Highlands and Pebble Beach Fire Department spoke in support of the resolution.
Mayor McCloud closed the meeting to public comment.
Council Member TALMAGE moved adoption of the Resolution with the addition that the Staff bring back to Council current information on all viable options, including JPA, shared services and stand alone fire department, seconded by Council Member ROSE, and carried unanimously.
NOTE: During Appearances, Carolyn Hardy applauded the City for approaching Cal Fire for the purpose of requesting a proposal for Fire Services from Cal Fire (Information gleaned from the September 2009 Minutes of the Pebble Beach Community Service District Board Meeting) and requested the City share the proposal with the public.
REFERENCE:
PEBBLE BEACH COMMUNITY SERVICES DISTRICT
BOARD OF DIRECTORS
Regular Meeting of September 25, 2009
MINUTES
Chief Haines stated that the City of Carmel would be sending CAL FIRE a formal request for proposal for fire protection services. Charlotte Townsend indicated she was a Director of the Carmel Residents Association which supports the City of Carmel in its consideration of CAL FIRE.
COMMENT:
• While Mayor Sue McCloud recently stated that the City is interested in looking at the concept of a regional fire department, and “would probably be derelict if we didn’t,” in the context of the Final Report of The Fire Department Consolidation Feasibility Analysis for the Cities of Monterey, Pacific Grove and Carmel completed by Citygate Associates, LLC in June 2007 and Carmel-by-the-Sea’s formal withdrawl from negotiations with Monterey and Pacific Grove in January 2008, it is derelict of the City of Carmel-by-the-Sea to not have studied and reviewed all viable fire protection service options and implemented a permanent fire protection service solution for the City of Carmel-by-the-Sea long before now.
Monday, November 30, 2009
Two Noteworthy 1 December 2009 City Council Agenda Items
ABSTRACT: Two noteworthy 1 December 2009 City Council Agenda Items, namely, Present FY 2008-09 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs and a Resolution authorizing participation in an Initial Exploration and Analysis of Joint Fire Service Options, are presented. Selected excerpts from Agenda Item Summary and Staff Report are presented for the Resolution Agenda Item. Informational COMMENTS are made regarding the Initial Exploration and Analysis of Joint Fire Service Options.
CITY OF CARMEL-BY-THE-SEA
City Council Agenda
Regular Meeting
Tuesday, December 1, 2009
4:30 p.m., Open Session
Live and archived video streaming available
City Hall
East side of Monte Verde Street between Ocean and Seventh Avenues
V. Announcements from Closed Session, from City Council Members and the City Administrator.
C. Announcements from City Administrator
1. Present FY 2008-09 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs.
X. Resolutions
A. Consideration of a Resolution authorizing participation in an Initial Exploration and Analysis of Joint Fire Service Options.
Description: At a November meeting, Mayors, City Managers and Fire Department Managers discussed the concept of joint fire services. The main discussion of the meeting was to review the current opportunities given the shrinking financial resources available to public agencies. The discussion centered on the potential of achieving organizational and operational efficiencies through some joint fire service options. The general consensus of the group was to participate in further discussions and analysis of achieving joint fire services.
Overall Cost:
City Funds: $0 with this action/unknown as to any future expense.
Staff Recommendation: Adopt the Resolution.
Important Considerations: Joint fire services should only be considered if improvements occur through a joint management oversight and improvements to operational efficiencies.
Decision Record: Several discussions have occurred over the past three to four years regarding fire shared services. To date, no action has been taken by the Council to expand beyond the current fire administration contract with the City of Monterey.
Authorize participation in an initial exploration and analysis of joint fire service options with the following goals:
a. Reduce or maintain response time for each community
b. Lower ISO rating for each community
c. Lower operating cost for each community
d. Increase the number of people and equipment available for response
City Staff anticipates completion of the Initial Analysis in early 2010.
COMMENTS:
• On Monday, 16 November 2009, representatives, including Fire Chiefs, elected officials and administrators for the cities of Monterey, Seaside, Pacific Grove, Marina, Sand City, Del Rey Oaks and Carmel-by-the-Sea, as well as the Monterey Peninsula Airport District, Presidio of Monterey, and Salinas Rural and Carmel Valley Fire Districts, met in Monterey to discuss the concept of a Monterey Peninsula-wide Fire Department and agreed to further research the regional fire department concept.
(Source: Fire chiefs, political leaders want Peninsula-wide Department, MARY BROWNFIELD, The Carmel Pine Cone, 8a &30A)
• Carmel-by-the-Sea’s Interim Fire Protection Services Contract with the City of Monterey expires January 31, 2010.
CITY OF CARMEL-BY-THE-SEA
City Council Agenda
Regular Meeting
Tuesday, December 1, 2009
4:30 p.m., Open Session
Live and archived video streaming available
City Hall
East side of Monte Verde Street between Ocean and Seventh Avenues
V. Announcements from Closed Session, from City Council Members and the City Administrator.
C. Announcements from City Administrator
1. Present FY 2008-09 Draft Audited Financial Statements by Ralph Marcello, Marcello & Company CPAs.
X. Resolutions
A. Consideration of a Resolution authorizing participation in an Initial Exploration and Analysis of Joint Fire Service Options.
Description: At a November meeting, Mayors, City Managers and Fire Department Managers discussed the concept of joint fire services. The main discussion of the meeting was to review the current opportunities given the shrinking financial resources available to public agencies. The discussion centered on the potential of achieving organizational and operational efficiencies through some joint fire service options. The general consensus of the group was to participate in further discussions and analysis of achieving joint fire services.
Overall Cost:
City Funds: $0 with this action/unknown as to any future expense.
Staff Recommendation: Adopt the Resolution.
Important Considerations: Joint fire services should only be considered if improvements occur through a joint management oversight and improvements to operational efficiencies.
Decision Record: Several discussions have occurred over the past three to four years regarding fire shared services. To date, no action has been taken by the Council to expand beyond the current fire administration contract with the City of Monterey.
Authorize participation in an initial exploration and analysis of joint fire service options with the following goals:
a. Reduce or maintain response time for each community
b. Lower ISO rating for each community
c. Lower operating cost for each community
d. Increase the number of people and equipment available for response
City Staff anticipates completion of the Initial Analysis in early 2010.
COMMENTS:
• On Monday, 16 November 2009, representatives, including Fire Chiefs, elected officials and administrators for the cities of Monterey, Seaside, Pacific Grove, Marina, Sand City, Del Rey Oaks and Carmel-by-the-Sea, as well as the Monterey Peninsula Airport District, Presidio of Monterey, and Salinas Rural and Carmel Valley Fire Districts, met in Monterey to discuss the concept of a Monterey Peninsula-wide Fire Department and agreed to further research the regional fire department concept.
(Source: Fire chiefs, political leaders want Peninsula-wide Department, MARY BROWNFIELD, The Carmel Pine Cone, 8a &30A)
• Carmel-by-the-Sea’s Interim Fire Protection Services Contract with the City of Monterey expires January 31, 2010.
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