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HomeMy WebLinkAboutMinutes 2013-02-20None. CITY HALL LARGE CONFERENCE ROOM 400 GRAND AVENUE SOUTH SAN FRANCISCO, CA, 94080 'IT ED 6:30 P.M. 1. Call to Order: 6:30 p.m. 2. Roll Call: Present: Councilmembers Addiego, Garbarino and Gupta, Mayor Pro Tern. Matsumoto and Mayor Gonzalez. 3. Agenda Review. 4. Public Comments — comments are limited to items on the Special Meeting Agenda. 5. Advertising and events Gross Receipts Ballot Measure. Principal Planner Beaudin presented the staff report. He stated that the City of South San Francisco is financially sound due to thoughtful decision making over the last few years. However, recent events, including "the Great Recession" and the dissolution of RDA are examples that demonstrate the City is not immune to global and state economic impacts. Accordingly, staff is constantly looking for viable alternatives and ways to maintain and enhance the services and infrastructure that are delivered to community residents. Staff believes that the ballot measure being considered for a proposed business license tax relating to certain advertising and events would do well and have little impact on the residents of South San Francisco. The tiered flat tax system would not be a percentage applied to gross receipts, but a fair business tax for businesses operating in SSF. The City has long considered tax variations, including the 2004 Measure J, which lost by the narrowest of margins against the 2/3 vote requirement. This time, staff recommends a general tax which requires 50% plus one (1) to pass. The tax proceeds would be more broadly used to serve the community since the funds would not be allocated or dedicated to a specific source. Staff proposed consideration of a tax that would focus on entertainment receipts, ticket sales, outdoor advertisers, taxi cabs and grocery shopping cart advertisements. Principal Planner Beaudin noted that this list was intended as a starting point for discussion. He then directed Council to tables in the staff report and advised that the estimates listed were for illustrative purposes only, Muni Services was enlisted to assist with this effort, yielding the prediction that there would be $300 thousand to $1 million each year in tax proceeds if the ballot measure was to succeed. Mayor Pro Tern Matsumoto asked if shopping cart advertisements were proposed for inclusion in the tax. City Attorney Mattas responded that shopping cart advertisements would be an option for consideration. Mayor Pro Tem Matsumoto queried whether the bulk of revenue would come from billboards. City Attorney Mattas emphasized staff's recommendation that the proposed tax not be limited in focus, as this would make it more susceptible to opposition and challenge. It would be best for the tax to be content neutral under the law and apply to a wider category of businesses as opposed to a particular type of business activity. He added that if the Council was interested in moving forward with this proposal, staff would come back with a variety of options. Mayor Pro Tem Matsumoto questioned the possible source(s) of the $75,000 for consultant costs. City Attorney Mattas advised the City cannot fund an advocacy campaign. If there was going to be a campaign in favor of the measure, then a privately organized group would have to create acampaign committee to fundraise. However, the law allows Council to gather information prior to the decision to place a ballot measure. The $75,000 would assist with providing preliminary information as to the likelihood of the measure's success. If Council wanted to test the pulse of the community, then that would be part of the work done over the next few months. Despite Mayor Pro Tem Matsumoto's support for the measure, she expressed concern that the costs would start mounting, and there would be the additional risk of having to fight legal challenges. City Attorney Mattas clarified that the cost component would really be staff and attorney time to pull the measure together. He did not anticipate that this would be a large amount, since most of the issues are already known. The primary component would be identifying what would be taxed. The extent of additional consulting services outside staff and attorney time, as well as polling services would be optional. Councilman Addiego opined that polling might not be particularly useful in this circumstance. City Attorney Mattas suggested that a subcommittee of the Council work with staff to determine what type of polling to use, if any; and if polling is used, what should be polled. He continued to advise that the recommendation is for a general tax, and residents cannot be promised specific uses for the funding. Staff s current plan was to bring the item back for Council action in early June, in order to place it on the ballot. It would require a fair amount of work over the next couple of months SPECIAL CITY COUNCIL MEETING FEBRUARY 20, 2013 MINUTES PAGE 2 to pull it together, if this was Council's direction. In response to Mayor Pro Tem. Matsumoto's query regarding the City's ability to provide information on its website, City Attorney Mattas responded that it can always provide neutral information as long as it is not advocacy. Councilman Addiego requested clarification as to categories of activities to which the tax would be applied. City Attorney Mattas advised it would be most advisable to have a broad group of categories subject to the tax and recommended working with the subcommittee of Council to more precisely define these categories. Councilman Garbarino asked if hotel room vacancy signs could be included. City Attorney Mattas responded this was not likely, since such a tax would focus on offsite advertising as opposed to onsite signage. In response to Mayor Pro Tern Matsumoto's inquiry as to Council's authority to adopt an ordinance forbidding Caltrain from permitting billboards along its right of way, City Attorney Mattas responded that it would depend on several factors that would need to be further considered, including whether the advertising would be of a government or proprietary nature. Councilman Gupta wished to clarify whether the business license tax was separate from this proposed tax. Staff so affirmed. Councilman Gupta sought commonality amongst activities proposed for taxation. He queried how staff would compare the billboard example against theatre ticket revenue. City Attorney Mattas explained that courts are generally deferential to how a City chooses to categorize taxed activities. There is no legal requirement that the subject matter be similar. It is rather common that cities tax certain activities at a higher level for multiple reasons. Councilman Gupta noted that he does not prefer billboards, but believed significant revenues could be generated by this proposal. Mayor Pro Tern Matsumoto requested a clarification on the schedule for the ballot measure proposal. City Attorney Mattas stated the initial outlay is to study community support for such a proposal. Mayor Gonzalez supported placing the proposed measure on the ballot. He stated, however, that he was uncertain as to whether voters would support it. Mayor Gonzalez appointed Councilmen Garbarino and Gupta to the subcommittee that would work SPECIAL CITY COUNCIL MEETING FEBRUARY 20, 2013 MINUTES PAGE 3 with staff to study and develop the proposed measure. 6. Finance Department Succession Planning and Reorganization Options. Finance Director Steele presented the staff report reviewing succession planning and reorganization options related to the Finance Department. He first advised the Department would undergo the retirement oft senior managers in the next 6-9 months. In the short term, the Department hoped to accomplish talent retention and succession planning over the next 1-2 years. Finance Director Steele would most likely retire in the next 2-3 years. Thus, staff was proposing this plan. He thanked HR Director Kathy Mount for making it possible to consider integrating the functions of their respective Departments. Finance Director Steele directed Council to page 4 of the Staff Report and advised the proposal was for a flexible structure that could possibly accommodate an Administrative Services Department, including some combination of departments like Finance, HR and IT. He stated the longer term goal was a more robust and efficient Finance Division with an increased focus on reporting, accounting and enhanced long-term planning. Director Steele stressed that this was just the beginning of the conversation and that nothing was set in stone. An Administrative Services Department would have the advantage of permitting cost savings and a redeployment of those savings to provide new and additional services. Mayor Pro Tem Matsumoto supported the direction of the proposal. She noted that SamTrans had done a similar restructuring that had been very successful. Finance Director Steele added that the proposal included the creation of the Assistant Finance Director position. Mayor Pro Tern Matsumoto offered the suggestion that the title be Deputy Finance Director. Finance Director Steele advised that the proposed reorganization phases would include the shifting and cycling of responsibilities to this new position. Councilman Gupta requested clarification of the proposed new positions. Finance Director Steele explained that a Director of Administrative Services was proposed. The Administrative Services Director would oversee the Finance Manager and HR Manager. Finance Director Steele concluded the presentation by stating no action was needed at this time. Staff sought Council's concurrence with continued review of the departmental merger options. Councilman Garbarino commended Director Steele for the very well thought out proposal. Councilman Addiego appreciated the proposal and was interested in bearing from the IT and HR Departments on the topic. Councilman Gupta welcomed the proposal. He cautioned that reorganization can sometimes create a SPECIAL CITY COUNCIL MEETING FEBRUARY 20, 2013 MINUTES PAGE 4 sense of activity without productivity. He was not stating that was the case here, but asked staff to be mindful of that tendency along the way. Mayor Gonzalez stated support for continued review of consolidation options. 7. Adjournment. Being no further business, Mayor Gonzalez adjourned the meeting at 8:01 p.m. SPECIAL CITY COUNCIL MEETING MINUTES FEBRUARY 20, 2013 PAGE 5