HomeMy WebLinkAbout2011-09-19 RegularMINUTES OF THE REGULAR MEETING
OF THE CITY COUNCIL OF THE CITY OF
SANTA ANA, CALIFORNIA
SEPTEMBER 19, 2011
CLOSED SESSION MEETING
CALLED TO ORDER
ATTENDANCE
POLICE COMMUNITY ROOM
60 CIVIC CENTER PLAZA
SANTA ANA, CA
5:10 P.M.
COUNCILMEMBERS Present:
MIGUEL PULIDO, Mayor (5:15 p.m.)
CLAUDIA ALVAREZ, Mayor Pro Tern (5:26
P.M.)
P. DAVID BENAVIDES
CARLOS BUSTAMANTE
MICHELE MARTINEZ
VINCENT F. SARMIENTO
SAL TINAJERO
COUNCILMEMBERS Absent:
None
STAFF Present:
PAUL M. WALTERS, Interim City Manager
JOSEPH STRAKA, Interim City Attorney
MARIA D. HUIZAR, Clerk of the Council
Quorum was established thru presence of Councilmembers Bustamante, Benavides,
Martinez, Sarmiento, and Tinajero.
MOTION: Elect Councilmember Bustamante Chair (pursuant to SAMC 2-
101 due to unavailability of Mayor and Mayor Pro Tem).
MOTION: Benavides
VOTE:
AYES:
NOES:
ABSTAIN:
SECOND: Sarmiento
Benavides, Bustamante, Martinez, Sarmiento,
Tinajero (5)
None (0)
None (0)
ABSENT: Alvarez, Pulido (2)
CITY COUNCIL MINUTES 1 SEPTEMBER 19, 2011
PUBLIC COMMENTS - None
COUNCIL RECESSED to Police Chief's Conference Room, 4th Floor, 60 Civic Center
Plaza for Closed Session discussion at 5:11 p.m.
CLOSED SESSION ITEMS
1A CONFERENCE WITH LABOR NEGOTIATOR pursuant to Government
Code Section 54957.6
Agency Negotiators: Personnel Services Executive Director,
Kathie Gonzalez
Employee Organizations: Santa Ana Police Officers Association
(POA)
Santa Ana Police Management Association
(PMA)
Santa Ana Firemen's Benevolent
Association (FBA)
Santa Ana Fire Management Association
(FMA)
Service Employees' International Union
(SEIU) Full-Time Employees
Service Employees' International Union
(SEIU) Part-time Civil Service
Employees
Confidential Association of Santa Ana
(CASA)
Santa Ana Management Association
(SAMA)
Agency Negotiator: Interim City Manager, Paul M. Walters
Employee Organizations: Executive Management (EM)
Mayor Pulido arrived at 5:15 p.m. and Mayor Pro Tem Alvarez at 5:26 p.m.
CITY COUNCIL MINUTES 2 SEPTEMBER 19, 2011
1B PUBLIC EMPLOYEE EMPLOYMENT AND APPOINTMENT pursuant to
Government Code Section 54957(b)(1)
Title: City Attorney
CLOSED SESSION REPORT - See Item 19A for Report.
ADJOURNED THE CLOSED SESSION MEETING AT 6:31 P.M. AND CONVENED TO
THE REGULAR OPEN MEETING
CITY COUNCIL MINUTES 3 SEPTEMBER 19, 2011
REGULAR OPEN SESSION
CALLED TO ORDER POLICE COMMUNITY ROOM
60 CIVIC CENTER PLAZA
SANTA ANA, CA
6:32 P.M.
ATTENDANCE COUNCILMEMBERS Present:
MIGUEL PULIDO, Mayor
CLAUDIA ALVAREZ, Mayor Pro Tern
P. DAVID BENAVIDES (6:37 p.m.)
CARLOS BUSTAMANTE
MICHELE MARTINEZ
VINCENT F. SARMIENTO (6:37 p.m.)
SAL TINAJERO (6:37 p.m.)
COUNCILMEMBERS Absent:
None
STAFF Present:
PAUL M. WALTERS, Interim City Manager
JOSEPH STRAKA, Interim City Attorney
MARIA D. HUIZAR, Clerk of the Council
PLEDGE OF ALLEGIANCE MAYOR PULIDO
CLOSED SESSION REPORT - See Agenda Item 19A for Report.
PUBLIC COMMENT
• Francisco Barragan, opined that Interim City Manager and Police Chief roles
assumed by Paul M. Walters is overextended and should have dedicated personnel
in said positions, even with City's budget situation.
• Stanley Fiala, commented on privileged speech, first amendment rights and right to
feel unwavering.
• Art Lomeli, representing Downtown PRIDE, seek dissolution of PBID; opined that
65% of PBID funds should be dedicated to 4th Street merchants for marketing and
promotions; Downtown Inc. has been directed to reorganize and restructure bylaws.
• Mark Roberts, spoke in support of Councilmember Bustamante, urged not to resign.
• Aurora (Penny) Lucio, expressed support for Councilmember Bustamante and for
efforts to improve Downtown Santa Ana.
• Saul Delgado, commented on great improvements throughout Downtown and
decision to remain in Santa Ana was because of direct efforts by Councilmember
Bustamante.
CITY COUNCIL MINUTES 4 SEPTEMBER 19, 2011
• Sam Romero, urged the City Council to dissolve PBID, efforts by Downtown Inc.
focused in Artist Village and promotion of restaurants in eastside.
• Connie Hamilton, announced that Comlink to host event at Yost Theater on
September 22"d, topic would include Downtown Inc.; also Connect to Council to host
resource event to highlight Ward 6 and discuss code enforcement, school and
neighborhood partnerships, and traffic congestion.
• David Brandt, commented on Agenda Item 25C, concerned with potential relocation
of major league soccer team, loss of open space, impacts to wildlife, neighborhoods,
and traffic.
• Alex Vega, commented on Agenda Item 25C, opined that Chivas USA not relocating
to Santa Ana; and commented that promotional events in Downtown too expensive.
• Bobi Keenan, commented on Agenda Item 25C, suggested that Memorandum of
Understanding between the City and neighborhood be approved; does not support
Chivas relocation to proposed site - disrupt wildlife, quality of life, and open land.
• Lilia Ramos, commented on Agenda Item 25C, concerned with potential relocation
site, increased traffic to neighborhood, and distance to freeway access.
• Rick Niedermeyer, noted success of Fiestas Patrias parade; thanked the City for
efforts; opined that having a major league soccer team in the City would benefit the
children and accessibility to major league team.
• Tom Lutz, (spoke on Agenda Item 25C) thanked Mayor Pulido and Councilmember
Bustamante for attending neighborhood meeting to discuss Chivas relocation plan;
happy they are not considering the Santa Ana Stadium as relocation site; opined
that Willowick not appropriate; support AYSO and other soccer teams, relocation site
should consider accessibility to freeways; suggested that a citizen advisory
committee be established.
• Charles Hart, opined that any potential sites should have CEQA certification prior to
negotiations to make sure they are viable locations (commented on Agenda Item
25C).
• Lisann Martinez, (spoke on Agenda Item 25C) representative of Santa Anita
Neighborhood Association, opposed to relocation of Chivas to Willowick site; urged
City Council to continue consideration of matter for 30 days and to hold a public
hearing on the matter.
• Rob Cook, commented on Agenda Item 25C, suggested relocation site be Santa
Ana Blvd. and Grand Ave. due to freeway accessibility.
• Mary Guzman, commented on Agenda Item 25C, concerned with potential site
because of noise, traffic, quality of life; support citizen advisory committee, ideal site
would be in the industrial area.
• Tim Rush, Chair of Santa Ana SOS committee, does not support relocation of
Chivas to Willowick; community under-parked; City should purchase Willowick and
leave as open area (spoke on Agenda Item 25C).
*Mayor Pulido mentioned that Santa Ana Stadium not being considered by Chivas
USA as potential relocation site.
• Tim Flammang, (spoke on Agenda Item 25C), opposed to Willowick location for
stadium, neighborhood not geared to deal with traffic.
• Jessica Cha, concerned with Downtown Inc. lack of transparency, financial
documents inadequate to meet accounting standards; urged City Council to
disestablish PBID.
CITY COUNCIL MINUTES 5 SEPTEMBER 19, 2011
• Claudia Arellanes, noted that 61 property owners had signed petition to disestablish
PBID, opined that assessment illegally approved; property taxes in default; does not
support re-boundary only disestablishment.
• Robert Escalante, opined that Downtown merchants support restaurants and
commerce in area, but not assessment fee; thanked Mayor Pro Tern Alvarez for
support; urged City Council to disestablish PBID.
• Jose Ceballos, urged City Council to dissolve PBID.
• Adolfo Lopez, opined that PBID assessment not fair; opposed to assessment.
• Fina Chaves, support disestablishment of PBID; opined that Downtown Inc. not
transparent in spending; not able to pay for increased taxes.
• Shawn Makani, asked that the City Council dissolve PBID and that membership be
voluntary; thanked Mayor Pro Tern Alvarez for support of Agenda Item 85A.
• Dave Hoen, urged City Council to give Downtown Inc. a fair chance; opposed to
Agenda Item 85A; opined that Downtown now a destination because of
improvements.
• Won Cha, property and business owner in Downtown; urged City Council to
disestablish PBID.
• Barbara DeRochers, opposed to PBID and urged disestablishment.
• Nina Jun, urged the City Council to disestablish PBID; Downtown Inc. bylaws flawed,
need transparency, City position vacant (since departure of Cindy Nelson), did not
receive election ballot when assessment voted on; business and property owners
need to vote on such matters.
• Archer Altstaetter, business owner of Outrageous Costumes and Couture, invited all
to grand opening on October 1St; noted that he had voluntarily become a member of
Downtown Inc. because of support and benefit received.
CONSENT CALENDAR ITEMS
MOTION: Approve Consent Calendar Items 10A through 25D with the
following modifications:
• Mayor Pro Tern Alvarez pulled item 11A for separate action;
• Councilmember Sarmiento pulled item 20A for separate action; and
• Mayor Pulido pulled item 25C for separate action.
MOTION: Martinez SECOND: Benavides
VOTE: AYES: Alvarez, Benavides, Bustamante, Martinez, Pulido,
Sarmiento, Tinajero (7)
NOES: None (0)
ABSTAIN: None (0)
ABSENT: None (0)
CITY COUNCIL MINUTES 6 SEPTEMBER 19, 2011
Items removed for separate action or modified are highlighted. Separate actions show
the actual vote. Items without votes are adopted as part of the consent motion.
ADMINISTRATIVE MATTERS
MINUTES
10A MINUTES FROM THE REGULAR MEETING OF THE CITY COUNCIL
HELD ON SEPTEMBER 6, 2011 - Clerk of the Council Office
MOTION: Approve Minutes.
ORDINANCES/SECOND READING
In the event a Councilmember recorded an "abstention" before consideration of the following
ordinance(s) on first reading, such abstention will also be reflected in the minutes for second reading.
11A ORDINANCE TO COMPLY WITH AND PARTICIPATE IN VOLUNTARY
REDEVELOPMENT PROGRAM PER PART 1.9 OF DIVISION 24 OF
CALIFORNIA HEALTH & SAFETY CODE - Community Development
Agency
Placed on first reading at the September 6, 2011 City Council meeting and
approved by a vote of 7-0.
Published in the Orange County Reporter on September 9, 2011.
*Mayor Pro Tern Alvarez noted concerns with the handling of some of the
City's redevelopment programs, the Redevelopment Agency's
participation in PBID and the Facade Rebate Program, but supports the
retention of Redevelopment Agency; has requested information from staff
on various programs; waiting for Supreme Court ruling on State's ability to
take away funds from cities.
MOTION: Place ordinance on second reading and adopt.*
ORDINANCE NO. NS-2823 - AN ORDINANCE OF THE CITY COUNCIL
OF THE CITY OF SANTA ANA, CALIFORNIA, DETERMINING IT WILL
COMPLY WITH THE VOLUNTARY ALTERNATIVE REDEVELOPMENT
PROGRAM PURSUANT TO PART 1.9 OF DIVISION 24 OF THE
CALIFORNIA HEALTH AND SAFETY CODE IN ORDER TO PERMIT
THE CONTINUED EXISTENCE AND OPERATION OF THE
COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF SANTA
ANA TAKING CERTAIN ACTIONS IN CONNECTION THEREWITH
MOTION: Alvarez* SECOND: Martinez
CITY COUNCIL MINUTES 7 SEPTEMBER 19, 2011
VOTE: AYES: Alvarez, Benavides, Bustamante, Martinez,
Pulido, Sarmiento, Tinajero (7)
NOES: None (0)
ABSTAIN: None (0)
ABSENT: None (0)
11B ORDINANCE TO ADJUST AND EXTEND THE FEE CHARGED TO
FINANCE THE CITY'S PROACTIVE RENTAL ENFORCEMENT
PROGRAM (PREP) ORDINANCE - Planning and Building Agency
Placed on first reading at the September 6, 2011 City Council meeting and
approved by a vote of 7-0.
Published in the Orange County Reporter on September 9, 2011.
MOTION: Place ordinance on second reading and adopt.
ORDINANCE NO. NS-2824 - AN ORDINANCE OF THE CITY COUNCIL
OF THE CITY OF SANTA ANA AMENDING SECTION 21-120r.l(a) OF
THE SANTA ANA MUNICIPAL CODE TO ADJUST AND EXTEND THE
FEE CHARGED TO FINANCE THE CITY'S PROACTIVE RENTAL
ENFORCEMENT PROGRAM
BOARDS / COMMISSIONS / COMMITTEES
13A APPOINTMENT YOUTH COMMISSION - NOMINATED BY
COUNCILMEMBER BENAVIDES AS THE WARD 4 REPRESENTATIVE
(ALTERNATE) FOR A FULL TERM EXPIRING DECEMBER 9, 2014 -
Clerk of the Council
MOTION: Appoint.
Name
Caleb Torres
(Replace Palos, S. )
Board/Commission
Youth Commission
MISCELLANEOUS ADMINISTRATION
19A CLOSED SESSION REPORT - Nothing to report.
Residing
Ward
5
CITY COUNCIL MINUTES 8 SEPTEMBER 19, 2011
19B EXCUSED ABSENCES - None
19C CONSOLIDATED ANNUAL PERFORMANCE & EVALUATION REPORT -
Community Development Agency
MOTION: Authorize submittal of the Consolidated Annual
Performance and Evaluation Report to the U. S. Department of
Housing and Urban Development.
BUDGETARY MATTERS
APPROPRIATION ADJUSTMENTS
20A TRANSPORTATION ENHANCEMENT FUNDING FOR THE FLOWER
STREET BIKE TRAIL GAP CLOSURE PROJECT - Public Works Agency
and Parks, Recreation & Community Services
Councilmember Sarmiento noted that project is golden loop and will
connect to the City of Costa Mesa. Executive Director of Parks and
Recreation Mouet commented on grant to build Class 1 bike trail with
dedicated land for pedestrians and bike riders.
MOTION:
1. Authorize the City Manager and Clerk of the Council to execute
the attached agreement subject to non-substantive changes
approved by the City Manager and City Attorney.
AGMT NO. 2011-215 - With the Orange County Transportation
Authority in an amount of $500,000.
2. Approve an appropriation adjustment. (Requires five affirmative
votes)
APPROPRIATION ADJUSTMENT NO. 2012-059 - Accepting funds in
the amount of $500,000 into the Select Street Construction Revenue
Fund for Federal Grants and appropriating $500,000 to the Select
Street Construction Expense Fund for Improvements Other Than
Buildings.
MOTION: Sarmiento SECOND: Martinez
VOTE: AYES: Alvarez, Benavides, Bustamante, Martinez,
Pulido, Sarmiento, Tinajero (7)
CITY COUNCIL MINUTES 9 SEPTEMBER 19, 2011
NOES: None (0)
ABSTAIN: None (0)
ABSENT: None (0)
AGREEMENTS
MOTION: Authorize the City Manager and Clerk of the Council to
execute the following agreements, subject to non-substantive
changes approved by the City Manager and City Attorney and/or
actions as noted on the Request for Council Action report. (Item
25A, 25B, and 25D)
25A AGMT NO. 2011-216 - MEMORANDUM OF UNDERSTANDING (MOU) -
With the Service Employees International Union Local 721 (SEIU)
representing Part-Time, Civil Service employees for a three-year period
covering July 1, 2010 through June 30, 2013 regarding wages and other
terms and conditions of employment - Personnel Services Agency
25B AGMT NO. 2011-217 - COOPERATIVE AGREEMENT BETWEEN THE
CITY OF SANTA ANA AND THE COMMUNITY REDEVELOPMENT
AGENCY PURSUANT TO ABX1 27 - Community Development Agency
25C NEGOTIATE WITH CHIVAS USA ENTERPRISES REGARDING
POTENTIAL RELOCATION TO SANTA ANA
Mayor Pulido recommended amendment to contract to remove paragraph
regarding negotiation exclusivity with the City of Santa Ana. Mayor Pro
Tern Alvarez thanked all speakers who addressed the City Council on the
matter; City to review all revenue enhancements; and City of Garden
Grove willing to negotiate on proposed site. Councilmember Sarmiento
noted that CEQA requirements are facilitated with recommended action,
invited soccer leagues to be engaged. Councilmember Bustamante would
not support building new stadium with taxpayer money; invited
neighborhood leaders to be involved. Councilmember Tinajero noted that
item first step in transparency; community input needed. Councilmember
Benavides would like to continue dialogue with community and provide
status of negotiations in 2-3 months. Councilmember Martinez healthy
community requires EIR and CEQA compliance; project would lead to job
creations.
CITY COUNCIL MINUTES 10 SEPTEMBER 19, 2011
MOTION: Amend the agreement and authorize the City Manager and
Clerk of the Council to execute the following agreement, subject to
non-substantive changes approved by the City Manager and City
Attorney.
AGMT NO. 2011-218 - With Chivas USA Enterprises for a term of six
months - City Manager's Office
MOTION: Pulido SECOND: Alvarez
VOTE: AYES: Alvarez, Benavides, Bustamante, Martinez,
Pulido, Sarmiento, Tinajero (7)
NOES: None (0)
ABSTAIN: None (0)
ABSENT: None (0)
25D AMENDMENTS TO HOMELESSNESS PREVENTION AND RAPID RE-
HOUSING PROGRAM AGREEMENTS - Community Development
Agency
Continued from the August 24, City Council meeting by a vote of 7-0.
• AGMT NO. 2011-219 - With Interval House increasing the (Rapid Re-
Housing) grant in the amount of $53,750
• AGMT NO. 2011-220 - With WISE Place increasing the (Rapid Re-
Housing and Homelessness Prevention) grant in the amount of
$53,750
• AGMT NO. 2011-221 - With Olive Crest decreasing the
(Homelessness Prevention) grant in the amount of $15,000
• AGMT NO. 2011-222 - With Olive Crest decreasing the (Rapid Re-
Housing) grant in the amount of $55,000
• AGMT NO. 2011-223 - With Public Law Center decreasing the
(Homelessness Prevention) grant in the amount of $17,500
• AGMT NO. 2011-224 - With Illumination Foundation decreasing the
(Homelessness Prevention) grant in the amount of $20,000
**END OF CONSENT CALENDAR**
CITY COUNCIL MINUTES 11 SEPTEMBER 19, 2011
BUSINESS CALENDAR ITEMS
RESOLUTIONS
55A FY2011 HOMELAND SECURITY GRANT PROGRAM AND RELATED
AGREEMENTS - Police Department
MOTION:
1. Adopt a resolution.
RESOLUTION NO. 2011-061 - A RESOLUTION OF THE CITY
COUNCIL OF THE CITY OF SANTA ANA AUTHORIZING THE CITY
MANAGER, AND THE CHIEF OF POLICE OR HIS DESIGNEE(S) TO
ENTER INTO AN AGREEMENT WITH THE STATE OF CALIFORNIA
EMERGENCY MANAGEMENT AGENCY FOR THE FY2011 URBAN
AREA SECURITY INITIATIVE FUNDING PROGRAM
2. Direct the City Attorney to prepare and authorize the Chief of
Police and the Clerk of the Council to enter into reimbursement
agreements for equipment, services, or training.
AGMT NO. 2011-225 - With the County of Orange or any of the cities
located in the designated Anaheim/Santa Ana Urban Area.
3. Approve an appropriation adjustment. (Requires five affirmative
votes)
APPROPRIATION ADJUSTMENT NO. 2012-055 - Recognizing the
FY 2011 Urban Areas Security Initiative in the amount of $7,421,142
in revenue account and appropriate same in the FY 2011 Urban
Areas Security Initiative Program Grant expenditure accounts.
MOTION: Benavides SECOND: Bustamante
VOTE: AYES: Alvarez, Benavides, Bustamante, Martinez,
Pulido, Sarmiento, Tinajero (7)
NOES: None (0)
ABSTAIN: None (0)
ABSENT: None (0)
CITY COUNCIL MINUTES 12 SEPTEMBER 19, 2011
55B CALIFORNIA 9-1-1 EMERGENCY COMMUNICATIONS OFFICE
FUNDING - Fire Department and Police Department
MOTION:
1. Adopt a resolution.
RESOLUTION NO. 2011-062 - A RESOLUTION OF THE CITY
COUNCIL OF SANTA ANA AUTHORIZING THE CITY MANAGER,
CHIEF OF POLICE AND THE FIRE CHIEF TO EXECUTE A GRANT
AWARD AGREEMENT WITH THE STATE OF CALIFORNIA
DEPARTMENT OF GENERAL SERVICES, 9-1-1 EMERGENCY
COMMUNICATIONS OFFICE
2. Approve an appropriation adjustment. (Requires five affirmative
votes)
APPROPRIATION ADJUSTMENT NO. 2012-058 - Accepting and
appropriating the California 9-1-1 Emergerncy Communications Office
reimbursement program in an amount of $532,478.
MOTION: Martinez SECOND: Sarmiento
VOTE: AYES: Alvarez, Benavides, Bustamante, Martinez,
Pulido, Sarmiento, Tinajero (7)
NOES: None (0)
ABSTAIN: None (0)
ABSENT: None (0)
55C AMENDING THE RULES AND PROCEDURES FOR MEETINGS OF THE
CITY COUNCIL AND REPEALING RESOLUTION NO. 2009-043 - Clerk
of the Council Office
MOTION: Adopt resolution with modification in section 2(b) to
include Council Chamber as meeting location or as noted on the
Agenda.
RESOLUTION NO. 2011-063 - A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF SANTA ANA ESTABLISHING RULES AND
PROCEDURES FOR MEETINGS OF THE CITY COUNCIL AND
REPEALING RESOLUTION NO. 2009-043
MOTION: Benavides SECOND: Martinez
CITY COUNCIL MINUTES 13 SEPTEMBER 19, 2011
VOTE: AYES: Alvarez, Benavides, Bustamante, Martinez,
Pulido, Sarmiento, Tinajero (7)
NOES: None (0)
ABSTAIN: None (0)
ABSENT: None (0)
CITY COUNCIL RECESSED AT 8:14 P.M. AND CONVENED TO THE COMMUNITY
REDEVELOPMENT AGENCY MEETING; THE CITY COUNCIL RECONVENED AT
8:15 P.M. WITH SAME MEMBERS PRESENT.
ADMINISTRATIVE MATTERS - BUSINESS
60A BUDGET STABILIZATION- City Manager's Office
Interim City Manager Paul M. Walters introduced Andy Belknap, Vice
Preside of Management Partners who then presented Budget Study.
About Management Partners
• Founded in 1994; offices in Irvine and San Jose, California and
Cincinnati, Ohio
• Experienced staff with organizational, operational and public finance
expertise
• Serves local governments exclusively
• Recent experience helping large cities like Santa Ana
¦ San Jose, Sacramento, Fremont, Tracy, Anaheim, Vallejo
Presentation Outline
• Project purpose
• Methodology
• 10-year financial perspective
• Options for balancing the budget
Project Purpose
• Identify ways to reduce costs and increase revenue so the City can
align expenditures with annual revenues
Project Methodology
• Analyzed documents (CAFRs, budgets, MOUs, program cost data,
compensation data, PERS costs, workers' compensation costs,
police and fire statistics, other departmental cost data)
• Interviewed Council, EMT, union representatives
CITY COUNCIL MINUTES 14 SEPTEMBER 19, 2011
• Conducted benchmarking to compare Santa Ana to other cities
(Anaheim, Chula Vista, Fremont, Long Beach, Riverside,
Sacramento )
• Created forecasting model and used financial data to develop
projections
• Worked collaboratively with Finance staff and the EMT
Financial Environment
• Recession hit Santa Ana hard
• Home prices decreased
• Unemployment went up, remains above 14%
• Personal income has dropped
• National economy is weak
• State continues to take funding away
• Santa Ana's revenues are below the median
Impact of Great Recession
jrin¢ Recessions and Recoveries: Job
Ten-Year Financial Perspective
CITY COUNCIL MINUTES 15 SEPTEMBER 19, 2011
M illion
$240.0 _
$232.0
$230.0 $225.9
.....$723.0
_$223A-._ $223-.0
$ 2 2 0 .0 $ 218.1 _--__
$220.1 $210.0
$218.
2
$210.0 _
-
$212.8
$209.4 $201.2 $210.8
$200.0 $203.5 ......... .......$205.2
$199.2 $199.8
$190.0 - ---- - -- --- 1s 6_.4- ----
$180.0
Actual Actual Actual Actual Estimated Adopted FY 12/13 FY 13/14 FY 14/15 FY 15116
FY 06/07 FY 07/08 FY 08/09 FY 09/10 FY 10/11 FY 11/12
-1rTota 1 General Fund Ra-nues &Transfers - In -Tota lGeneral FUnd Expend itures and T ransfers - Out
Past Budget Balancing Techniques
• Layoffs and elimination of vacancies
• Compensation deferrals, some elimination of wage increases,
some furloughs
• Cuts in departmental budgets
• Use of unrestricted fund balance to make up the large gap each
year - actual cost reductions were not deep enough to match
spending to revenues
Fund Balance Used To Maintain Services
50
45 (( $42.9M _ _ ___.
Revenues Are Going Down
• Sales, property and utility users tax are much lower than in FY
07/08, with 14% decline
• State took $1.2M in vehicle license fees
• Redevelopment loss will cost the General Fund between $1 to
$6M/year
• Recession and high unemployment in Santa Ana remain big
problems - and could reduce fundamental tax revenues even more
Difficulty in Reducing Costs
• Contracts in place for most personnel costs
• Cost per employee has increased, even with fewer employees,
mainly due to PIERS
CITY COUNCIL MINUTES 16 SEPTEMBER 19, 2011
• PERS rates significantly increasing
• City has cut maintenance and other costs that cannot be
permanently eliminated, just deferred
PIERS Cost Increases
60.000% -- --
50.000% 48.600%
42600Y.-
40.000% - 36.600;% 36:600%36600%
28.846% 30500 ' 30.000%
30.000% 24.499% 26.000%.,?,.. 26.400% •" ---Safety
22.323% 23.906% 22.S17% 22.9009£ ..
-Miscellaneous
20.000% 22.900% 22.90W% 22.900%
18_373% 19300%
10.000) 3.312% 15.00046
8.214% 7.073% 6.816%
0.000%
FY 12/13 Projected Projected Projected
FY 06/07 FY 07/08 FY 08/09 FY 09/10 FY 10/11 FY 11112 FY 13/14 FY 14/15 FY 15/16
What Does This Mean?
• Significant structural deficit - costs exceed revenues
• In spite of the significant cuts made in the last few years, economy
has not improved and reductions have not been enough
• Costs will now need to be reduced in major ways, absent major
new revenues
The Deficit
• Management Partners' forecast was completed in May - with a
deficit of $13.6M this year and over $18M in FY 12/13
• The gap is now identified by City staff to be $30M for FY 12/13 due
to new revenue problems
¦ State takeaways and declining utility users tax
Stabilization Study Report
• Provides a menu of solutions and strategies
• Strategies could generate $26M to $27M in annual savings and
new revenue
• None of the solutions are easy
• They do represent ideas that are being executed around the State
Ultimate Goal Is to Preserve Services
• Services are vitally important to the people of Santa Ana
• Making existing services more efficient should be the first priority
• Reducing or eliminating services should be a last resort, only if
maximizing efficiency is not enough
CITY COUNCIL MINUTES 17 SEPTEMBER 19, 2011
Multi-Pronged Approach
Service Delivery
Model Changes
Compensation
Changes
City's Next Steps
• City Manager recommending a budget stabilization plan
• Four-pronged approach:
¦ Negotiated compensation reductions
¦ Outsourcing
¦ Restructuring and service reductions
¦ Revenue increases
Budget Stabilization Plan presented by Interim City Manager, Paul M.
Walters
O Four-Prong Approach
1. Negotiated Compensation Reductions
2. Outsourcing
3. Restructuring and Service Reductions
4. Revenue Increases
In addition to these four areas, the City will be implementing a
variety of expenditure control measures.
O Negotiated Compensation Reductions
• Hired an outside labor negotiator to assist in securing union
concessions. City is in CLOSED contracts with limited re-opener
language with all of its unions.
• Meetings with union leadership currently in progress.
• All union leaders were given a presentation of the Management
Partners Report and the City's Budget Stabilization Plan.
• Goal is to have clarity on possible compensation reductions by
October 30, 2011.
O Outsourcing
• City has developed Request for Proposals to gather cost estimates
for 16 different outsourcing projects.
• Beginning in January 2012 outsourcing recommendations will begin
to be presented to the City Council.
• The currently-identified outsource projects are:
1. Animal Control Services
2. City Jail
3. Santa Ana Zoo
CITY COUNCIL MINUTES 18 SEPTEMBER 19, 2011
4. Fleet Services and Central Stores
5. Fire Dept. Dispatch
6. Background Police Investigations
7. Parking Meter Services
8. Residential and Commercial Street Sweeping
9. Fire Dept. IT Services
10. Police Training Services (Civilianize)
11. Renegotiate Bowers Museum Agreement
12. EMT/Ambulance Services
13. Library Services
14. Workers' Compensation Services
15. Fire Services to OCFA
16. Parking Control Services
O Restructuring and Service Reductions
• Every City department will be asked to cut their budgets and
present different service delivery options.
• A list of recommended departmental reductions will be presented to
City Council.
• Priority has been placed on maintaining mission critical City
services and infrastructure.
O Revenue Increases
• City is gathering information for a possible voter-approved revenue
enhancement.
• City proactively trying to recover funds from programs such as
paramedic subscriptions and false alarm, and from our utility
franchise agreement.
• City investigating revenue from the marketing of City assets and
from potential sponsorships.
• City focusing on any and all economic development projects that
could generate revenue to the City.
• Initiated a review of all City-owned properties and remnant parcels
for possible sale or lease.
O Expenditure Controls
• Restricted or deferred all General Fund non-mission critical capital
purchases such as vehicles, computers and equipment.
• Maintained almost all vacancies and initiated a soft hiring freeze.
• Eliminated overtime unless pre-approved or mandated by contract.
• Will initiate internal policies regarding paper printing, water savings
and utility cost controls.
• Initiated a review of all additive pay such as bilingual and career
development pay.
• Requested reductions in use of City vehicles.
O Additional Actions Taken to Implement Plan
CITY COUNCIL MINUTES 19 SEPTEMBER 19, 2011
Brought in a financial consultant to advise the City on revenue and
expenditure strategies.
Consulting with similar-sized cities regarding their deficits and
creative budget balancing strategies.
Initiated increased external and internal communications to improve
transparency and to promote dialogue. An employee portal to
solicit budget suggestions has been implemented as well as an
email blast communication system for City residents.
O Fiscal Principles
• Fund ongoing expenditures with recurring revenues
• Preserve remaining unrestricted fund balance and build a General
Fund reserve.
• Utilize internal service funds for intended uses, emergencies,
contingencies, cash flow, and transition costs in service delivery.
• Negotiate future compensation agreements that can be sustainable
and affordable based on City's financial capacity.
Councilmember Sarmiento thanked Interim City Manager Walters on
transparent discussion of budget situation; many factors contribute to
situation; 400 positions already eliminated throughout the City, asked
Interim City Manager to make key changes, as needed, to administration
that will help navigate and analyze situation - suggested appointment of
Assistant City Manager position; City Council to meet on a weekly basis to
discuss labor negotiations; and also re-establish Finance Ad Hoc
committee.
Councilmember Bustamante thanked staff for efforts to bridge gap.
*Mayor Pulido left the meeting at 8:39 p.m. and did not return. Mayor Pro Tern Alvarez
assumed the Chair.
Councilmember Tinajero commented on City's high unemployment rate in
comparison to State and National levels; unions are willing to negotiate;
prepare to make tough decisions.
Councilmember Benavides noted seriousness of situation; need analysis
of all options including labor concessions; re-active Finance Ad Hoc
Committee; and thanked unions for willingness to negotiate.
Councilmember Martinez thanked Interim City Manager Walters for efforts
on matter; thanked unions; need to make structural changes to alleviate
cash flow problem; support Finance Ad Hoc Committee; suggested City
have independent Controller/Auditor position and Assistant City Manager
position.
CITY COUNCIL MINUTES 20 SEPTEMBER 19, 2011
Mayor Pro Tern Alvarez thanked bargaining unions for good faith efforts
made in the past and encouraged business owners, neighborhood
associations and all to continue to work together.
MOTION:
1. Direct the City Manager to implement a budget stabilization plan
based on the framework of a four-pronged approach that
includes:
1. Negotiated compensation reductions
2. Outsourcing services
3. Restructuring and service reductions
4. Revenue increases
2. Re-establish the City Council Finance Ad Hoc Committee.*
MOTION: Sarmiento SECOND: Benavides
VOTE: AYES: Alvarez, Benavides, Bustamante, Martinez,
Sarmiento, Tinajero (6)
NOES: None (0)
ABSTAIN: None (0)
ABSENT: Pulido (1)
*Caveat to motion made by Mayor Pro Tern Alvarez that all of the City
Council members responsible to be informed, provide input, and
take message forward, as it related to the budget.
Councilmember Sarmiento declared a conflict of interest on Item 85A; has clients that
reside in the area; left the meeting at 9:12 p.m. and did not return. Mayor Pro Tern
Alvarez assumed the Chair and presided over the meeting.
COUNCIL AGENDA ITEMS
Pursuant to Santa Ana Charter Section 411, any member of the City Council may
place items on the City Council Agenda to be considered by the City Council.
85A RESOLUTION OF INTENT TO SET PUBLIC HEARING DATE -
DISESTABLISH THE COMMUNITY MANAGEMENT DISTRICT (CMD) -
Mayor Pro Tern Alvarez
Continued from the August 24, 2011 City Council Meeting.
CITY COUNCIL MINUTES 21 SEPTEMBER 19, 2011
Comments by Mayor Pro Tern Alvarez, thanked all for attending meetings
on issue; thanked for support, gifts and baskets of fruit - given to local
non-profits and homeless; asked colleagues to support item in light of
economic situation and transparency issues; used example of furniture
store of businesses significantly impacted - want them all to succeed and
not hinder with imposition of an additional tax; some businesses have
doubled their property tax amount; also concerned with the collection
method for assessment fee; suspicious of average assessment in the
amount of $1500, which believe is higher; threat of lawsuit; asked City
Attorney to review documents and provide potential liability amount if sued
by Downtown, Inc., also want to know the timeline to provide the
assessment fee to Downtown, Inc.; Downtown Inc. has not submitted
annual budget; continue to have transparency issues; questioned board
election process and selection of officers; questioned process used to
establish PBID; Councilmember Martinez and Mayor Pro Tern Alvarez had
requested Board to diversify; requested timeline from Downtown Inc. to
implement corrective actions; asked the City Council to start addressing
problem and hold Downtown, Inc. accountable; noted that if City had not
voted, PBID would not have passed; believe if revote taken today would
not pass as some who had supported have changed mind; is supportive of
the new businesses; Artist Village success started many years; Item 85A
only sets public hearing and provides legal notice to all property owners;
opined that the City Council are on notice of process, transparency, and
mismanagement issues with Downtown, Inc. and requested that said
comments be made part of the record.
Councilmember Martinez represents area; issue brewing for past 18-
months; had met with some business owners, council had not addressed
the issues when first advised; has been in communication with Downtown,
Inc. representatives; need all facts before decision can be made; asked
Mayor Pro Tern to continue matter for 60-days to address method of
collection issue; if can't resolve will then reconsider item; City to focus on
budget situation.
Councilmember Tinajero has met with representatives on the subject;
support re-boundary; asked for more representation on Board and for all
businesses to receive benefit; can still dissolve in a year if things haven't
changed.
Councilmember Benavides have heard concerns from both sides; has
worked on trying to bring the two entities together, have made
concessions; voted unanimously to extend the PBID for a year;
disingenuous to continue said agenda item; City voted unanimously to
establish PBID and allow City to participate in voting; requested
Downtown, Inc. to diversify board and marketing efforts to assist all; would
like to give opportunity to demonstrate responsiveness; will consider
matter in a year if problems persist.
CITY COUNCIL MINUTES 22 SEPTEMBER 19, 2011
Mayor Pro Tern Alvarez clarified that City Council did not vote to extend
the PBID for a year, only downsize district; have not approved Downtown
Inc. annual budget. Requested that item be continued to the next meeting
and give Downtown, Inc. an opportunity to address concerns.
Mayor Pro Tern Alvarez continued item to the October 3, 2011 City
Council Meeting.
COMMENTS
90A CITY MANAGER'S COMMENTS
• Interim City Manager Walters noted that he has met with all City
departments to discuss status of City finances; has received positive
feedback.
90B CITY COUNCILMEMBER COMMENTS
Councilmember Tijanero:
• Commented on budget and need to continue dialogue with labor
groups, decisions within 30-60 days.
Councilmember Benavides:
• Tough budget decisions to be made;
• Annual Fiestas Patrias event and parade was great success; thanked
all for efforts,
• Encouraged all to attend a Walk-A-Thon and Resource Fair at Madison
Park on Saturday, September 24th;
• Planning and Building Executive Director, Jay Trevino announced
event at Centennial Park to hold communit workshops on the Harbor
Boulevard Plan on Saturday, September 24 h; and
• Encouraged residents to engage in civic activity throughout the City.
Councilmember Martinez:
• Represented the Mayor and City Council in the welcoming ceremony
for HUD Assistant Secretary, Mercedes Marquez held at Willard
neighborhood;
• City held Fiestas Patrias over the weekend in celebration of Hispanic
Heritage Month; thanked Parks and Recreation, promoters, and all for
success;
• Thanked Planning and Building Agency for Harbor Blvd. Corridor area
project and efforts to have project transparent;
• Senator Correa hosting a Health and Fitness event at Valley High
School on Saturday, September 24th; and
• Congratulated Walker Elementary for winning Governor's Fitness
Challenge competition.
CITY COUNCIL MINUTES 23 SEPTEMBER 19, 2011
Mayor Pro Tern Alvarez:
• Fiestas Patrias had high attendance; thanked all who participated in
success and to Police Chief Walters for leading parade on horse; and
• Thanked Interim City Manager and executive management team for
tough budget decisions.
ADJOURNED- 9:54 P.M. - The next meeting of the City Council is scheduled for
Monday, October 3, 2011 at 5:00 p.m. for the Closed Session
Meeting immediately followed by the Regular Open Business
Meeting in the Council Chamber, 22 Civic Center Plaza, Santa Ana,
California.
Maria D. Huizar,
Clerk of the Council
CITY COUNCIL MINUTES 24 SEPTEMBER 19, 2011