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For the record, Councilman Yamamoto stated that he was opposed to the Agency renting space outside the City Hall, and to its issuing bonds at this particular time when "everyone is pinching pennies". CA 65B BALANCING FUTURE BUDGETS Councilman Bricken stated COUNCIL COMMENTS that there is still a lot of spade work to do before the Council can determine how to deal with the question of growth control of the City's costs. He complimented the City Manager's response of 3une 28 to his own memo on the subject dated June 26, adding that he hoped there would be some suggestions in terms of what Council is going to do in future years. Vice Mayor Ward concurred, stating that this year the City would receive about 2.5 million dollars from the State, but next year it will probably be half that amount. Councilman Bricken further stated that it may turn out that the City will have more revenue than it should be spending in terms of other considerations, and that Council should not be lured by the siren call to spend the money because it is there. CA 65B FREEZE ON AUTOMATIC STEP Councilman Bricken moved INCREASES FOR EMPLOYEES to freeze all automatic NOT APPROVED step increases until negotiations have been completed and to direct the City Attorney to prepare the appro- priate resolution. The motion was seconded by Vice Mayor Ward, and it failed to carry 3:2, with Councilmen Brandt and Ortiz dissenting. During the discussion on the motion, the City Manager stated he did not recommend approval and that the cost impact is approxi- mately $105,000, and that the City's newer employees would be the ones affected most. The City Attorney stated that it is a meet and confer question, and could not be effected without that process. Vice Mayor Ward stated that his intent is to have the City stop spending money until the meet and confer process is completed, and that the spirit of Proposition 13 is to hold costs down. The following persons spoke against the motion: John O'Malley, Representative of the Santa Ana City.Employees Association Mrs. Mickey Madden, 2319 N. Rosewood Mrs. Charleen Hunter, 1119 N. Baker Councilman Brandt stated that the negative impacts of the motion far outweigh the benefits; that the City should work hard to negotiate with the employees; that insurance can be changed, retirement for future hires can be changed, and retirement for existing employees can be changed if the program is similar. Councilman Ortiz stated that employees who have proven they can produce for the City deserve the step increases; and that they have the right to expect the City to abide by its own rules in effect when they accepted the job. Councilman Bricken stated that there are no rules in private employment that say what you give you cannot take away; that the rules of the road change; if the taxpayer gave he can take away; that when the circumstances change, you have to change CITY COUNCIL MINUTES 271 JULY 1, 1978