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Home My WebLink AboutE-1 2-27-2017, Minutes Special MeetingCITY OF AZUSA MINUTES OF THE SPECIAL MEETING OF THE CITY COUNCIL MONDAY, FEBRUARY 27, 2017 – 6:30 P.M. The City Council of the City of Azusa met in Special Session at the above date and time in the Azusa Light & Water Conference Room, located at 729 N. Azusa Avenue, Azusa, CA 91702. Mayor Rocha called the meeting to order at 6:30 P.M. ROLL CALL: Roll call was taken by City Clerk Cornejo. PRESENT: COUNCILMEMBERS: GONZALES, CARRILLO, MACIAS, ALVAREZ, ROCHA ABSENT: COUNCILMEMBERS: NONE ALSO PRESENT Elected Officials: City Clerk Cornejo, City Treasurer Vasquez. Staff Members: City Manager Butzlaff, City Attorney Ferre, Management Analyst Lacasella, Chief Deputy City Clerk Garcia, Economic & Community Development Director Christiansen, Public Works Director/City Engineer Bobadilla, IT/Library Services Director Graf, Director of Utilities Morrow, Utility Communication & Environment Program Specialist Sagun, Storekeeper Alvarez, Finance Director Johnson, and Budget Analyst Lam. PUBLIC COMMENT None given. FISCAL YEAR 2016-17 GENERAL FUND MID-YEAR BUDGET REVIEW AND ADJUSTMENTS Finance Director Johnson presented the mid-year budget and financial update for the 2016/17 Fiscal Year stating that the goal was to meet and to maintain a 15% reserve policy for the general fund. Expenditures highlights included unfunded liabilities, pension and postemployment benefit cost, a conservative 2.5% sales tax increase, moderate property tax growth of 3%. The budget projection showed an increase of $3.2 million dollars to the general fund unrestricted balance, which included a $2 million dollar, onetime property sale; there were no anticipated changes to operation in fiscal years 2017/18 and 2018/19; and a moderate increase is projected within the next few years. As of January 31, 2017 the budget was at 58% of the budget year; a property tax reimbursement was received in December and the city was at 60% of budget; sales tax showed a 2 month difference from when revenues are received; the City will be on track by end of fiscal year. Charges for services are at a low due to revenues received later in the fiscal year for seasonal registrations with the Recreation Department, and reimbursements received from APU and the Azusa School District for police services. Finance Director Johnson responded to a question posed by the Council stating that the first assumption from the Hilton Hotel would not be included for the 2016/17 budget year. Revenue highlights included a $138,700 proposed increase in revenue due to current activities exceeding the adopted budget; the Board of Equalization Business Tax allocation in quarter 3 had a misallocation of local taxes due to not having real property information on the Lagunitas site, this adjustment would increase taxes by $65,000. Revenues include $2 million dollar one time property sale related to the Gold Line. In January Council approved a resolution which increased vacant and abandoned commercial property registration fees to $500 per commercial property; registration fees generated $40,000 in revenue; a revenue decrease was projected for motor vehicle moving violations due to Senate Bill 185 (SB185), which grants amnesty for delinquent traffic tickets; miscellaneous increases were proposed for library and passport services; various miscellaneous increases to Library and Passport revenues combined $7,000. dollar increase; projected an increase of $27,000 dollars for permits, cost reimbursement, real property record fees; and an increase in Recreation donations would bring an additional $10,000 dollars. Chief Hunt responded to a question posed by the Council regarding motor vehicle violations, stating that there are two programs in place, the first is an Amnesty Bill resulting in an 80% reduction in the fine; the second, is the Senate Bill which will take effect in the year 2017 and reduce fines according to monthly income. CONSENT ITEM E-1 APPROVED CITY COUNCIL 6/5/2017 Discussion ensued regarding vacant property registrations. City Manager Butzlaff clarified that a previously adopted Ordinance regarding foreclosure of residential properties is in partnership with a company that collaborates with the banks on foreclosed properties, and generated the $40,000. The recently adopted vacant and abandoned building Ordinance, which applies to commercial and industrial vacant buildings, also includes a $500.00 registration fee, but staff has not determined the amount of increased revenue, due to the recent implementation of the program. Salaries and Benefits were budgeted at $400,000 dollars and based on vacant positions that have not been filled within the fiscal year, there was an anticipated savings of $275,000; leave payouts were budgeted $900,000; and a Side Letter Agreement with Azusa Police Management Association was adopted which resulted in additional payouts of $250,000 for recent personnel changes and included 4 to 6 retirements within the Police Department. Insurance premiums increased to $160,000 and the City had to accommodate in the amount of $736,000 for city wide leave payouts, vacations and sick leave. Various Expenditures included an increase in legal services costs in Economic and Community Development due to development activities; the City approved a contract for CDBG consulting services which cannot be funded through CDBG proceeds; and additional appropriations are needed in Human Resources to cover the cost of recruitment for a new Director and additional city wide professional development staff training. Finance Director Johnson requested to approve the proposed amendments and changes to the ending fund balance from the originally proposed $3.2 million dollars to $2.6 million dollars. A projected $2 million dollar change in the fiscal year 2017/18 will include a $2.9 million dollar onetime property sale revenue for development; additional increase to PERS cost; and payout to ICMA for special assessment within the last few years. In fiscal year 2018/19 revenues will go down due to onetime property sales revenues not being included and an increase in PERS rates and a Pension Obligation Bond will level it out. An analysis of an adopted 15% general fund reserve policy was done, the goal was to hit $5.7 million dollars with an unrestricted reserve balance. It has been projected that by the end of the year, there will be an $8.4 million dollar unrestricted reserve balance, which will exceed the 15% general reserve policy; a 2017/18 payout to the ICMA special assessment of $1.8 million dollars will be determined at a later time. PERS is considering lowering their discount rate of 7.5% by .15% each year for the next three years until it reaches 7% in the year 2021; the annual payments and unfunded liability cost will increase. Staff is proposing to establish a Trust Account for the Oped and Liability which will be brought to Council at a later time. In fiscal year 2017/18 Staff will present an infrastructure and facilities assessment for Council consideration. Mayor Pro-Tem Carrillo offered Resolution No. 2017-C12 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA APPROVING AND ADOPTING THE MID - YEAR BUDGET ADJUSTMENTS FOR THE CITY OF AZUSA Moved by Mayor Pro-Tem Carrillo, seconded by Councilmember Gonzales, and carried unanimously by the vote of the Council to adopt Resolution 2017-C12. AYES: COUNCILMEMBERS: GONZALES, CARRILLO, MACIAS, ALVAREZ, ROCHA NOES: COUNCILMEMBERS: NONE ADJOURNMENT It was consensus of the Council to adjourn the meeting. TIME OF ADJOURNMENT: 8:24 P.M. _________________________________ CITY CLERK PAGE TWO, 2/27/2017