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HomeMy WebLinkAboutMinutes 1992-06-17 Mayor John R. Penna Council: Jack Drago Joseph A. Fernekes Roberta Cerri Teglia ~bert Yee AGENDA ADJOURNED REGULAR MEETING CALL TO ORDER: (Cassette No. 1) ROLL CALL: 1. Review of Fiscal Year 1992-93 MINUTES City Council ~ City Council Conference Room City Hal 1 June 17, 1992 161 ACTION TAKEN ADJOURNED REGULAR MEETING 7:10 p.m. Mayor Pro Tem Teglia pre- siding. Council present: Council absent: Drago, Fernekes, Yee, and Teglia. Penna. City Clerk Battaya informed the Council that Mayor Penna was on vacation. City Manager Armas stated that normally this would be the culmination of a pro- cess that began months ago, but given the recent news in Sacramento some are viewing this as a transition, rather than a culmination. He stated that he would spend time with introductory remarks; he would then respond to Council questions; and then Council would give direction on some items listed in the supplemental material presented. He stated that Council held a study session in February on the current fiscal position, and at that time gave direction for the preparation of the budget. He stated that Council had identified three broad principles: that the appropriation and expenditures amounts remain within the current appropriation limits; indi- cated a willingness to utilize $500,000 in our economic contingency fund to deal with the anticipated effects of the recession and new year; and indicated that we will forgo a transfer of $500,000 from the General Fund to the Capital Improvement Program. He stated that the budget presented to you is consistent with this direction, and reflects a reduction in the anticipated shortfall of $900,000. He related the following with respect to 6/17/92 Page i ^cT o, T^KEN 162 Review - Continued. revenues and expenditures: income was anticipated approaching $29,500,000, and expenditures of $30,700,000; an operating shortfall for the new year of $1,200,000 on the expenditure side that will reflect roughly $800,000 and is the current authorized level, and is in keeping with the Feb. direction; on the revenue side - feel uncomfortable with the state of the economy; our revenue projections are reflective of our pessimism as to whether the economy will rebound; are dependent on three revenue sources for the bulk of the General Fund operation - sales tax, property tax, and hotel tax in descending order which is less than what was pro- jected when you adopted the budget for the current year; 1992-93 represents an increase of a little over 5% which is misleading because it is still less than anticipated for the present year; we pro- ject an increase of 5% over the new year; County Assessor is projecting a 5% rate of growth for the entire County even with delinquencies in taxes due to the econ- omy; sales tax comes from the city of origin; T.O.T. was projected at $2,300,000 for 1992-93. He stated that he did not expect to meet our target this year owing to the state of the economy, and it is expected that revenue will be $1,400,000 short; and the majority of that was sales tax. He stated that as the economy has stayed in the recession longer than anticipated and are continuing to feel the effects in that area even though we are showing a shortfall for next year, and we utilized fund balances to cover that for the new year. He stated that in recent years we have been experiencing savings of 3-5% of authorized expenditures, and 3% was roughly a $1,000,000, so there is a reasonable likelihood that the shortfall will virtually disappear at the end of the year based on past trends. He stated that going into the new year he 6/17/92 Page 2 AGENDA ACT]iON TAKEN ~ 163 Review - Continued. was making the assessment as to where we will be 6/30/93. We project we will have a fund balance of $6,800,000, with $2,100,000 in undesignated and completely discretionary when compared to expen- diture level. He stated that he believed that the School District is seeking to have a 3% reserve, so the Council could see by example that we are in a position to deal with unforeseen events should that arise. He stated that relying on fund balance on a recurring basis is a mistake, it results in a false sense of security - a service that cannot be sustained over the long haul. He recom- mended that the Council in the course of the new year begin a thorough review of base line level of services, and identify the bare minimum we have committed to by way of service to the public; and offset against that will be some kind of an eva- luation of the baseline level of income we can expect on a recurring basis and compare that with the annual deficit. He stated that we would need to curtail our expenditures and before we can talk about adjustments on the revenue side to a significant degree, we need to demonstrate that we have critically looked at our expenditures to the extent there are the opportunities to reduce those - that we have spent considerable amount of time giving the necessary ana- lysis to demonstrate that we are running a sufficient operation. He stated that only then would he recommend looking at the income side of the ledger to view it in a longer perspective to make a allowance for providing income to transfer to the Capital Improvement Program on a regular basis for on-going maintenance of public facilities, etc. He stated that he had presented a lean and reasonable budget in view of the eco- nomic conditions facing us, and more recently with respect to the State. He stated that the fiscal affairs from the State merit discussion in that they are trying to deal with a $10,000,000,000- 6/17/92 Page 3 AGENDA ACTION TAKEN ~ 164 Review - Continued. $12,000,000,000 deficit, and some of that will be addressed through changes in ser- vice levels such as health and welfare. He stated that beyond that the State is looking to pass on responsibility to the local California Governments. He described State proposals under con- sideration that if implemented could represent a substantial hit to local government: shifting nearly $3,000,000,000 in property tax revenue from cities, special districts, and coun- ties to fund schools; shifting $900,000,000 of license fee renewals away from cities; at risk is $21,000,000,000 in vehicle registration fees; $8,000,000+ in property tax. He stated that for South San Francisco depending on which approach is taken we are at risk of $1,000,000 - $3,000,000: $1,000,000 if only property tax; and $2,000,000 on top of that if we lose the vehicle license fees. He described steps taken pursuant to Council direction: letters sent over the Mayor's signature to our Senate and Assembly representatives; residents received a notice in their mailbox in the last day or two; an ad in this morning's Enterprise Journal alerting our residents to potential con- sequences; in Friday's San Mateo Times there will also be an ad sponsored by five cities - S.S.F., Millbrae, San Bruno, Daly City, and San Mateo to alert residents of the potential impacts from the State proposals. Councilman Fernekes questioned if speci- fic questions would be asked now about revenues and expenditures. City Manager Armas suggested beginning with the overall revenue and expen- ditures, and look at the individual departments. Councilman Yee stated that at the study session in February, Council gave direc- tion to staff, and assumed those direc- 6/17/92 Page 4 165 AGENDA · Review - Continued. RECESS: RECALL TO ORDER: ACTION TAKEN tions were verbal rather than written, and also assumed that the three members of Council agreed with the Manager. Councilman Drago stated that at that meeting all they had been given were pro- jections, and transfers and talk of cutting capital improvement appropri- ations, but they did not see any detail on consultants and overtime. Mayor Pro Tem Teglia declared a recess at 7:30 p.m. so the City Clerk could get the minutes of the February meeting for Councilman Yee. Mayor Pro Tem Teglia recalled the meeting to order at 7:35 p.m., all Council present. Councilman Yee stated that the minutes reflect two sentences here that say there was a general consensus that the 1992-93 budget would be prepared on maintaining at the same level of appropriations authorized in the current year. He questioned what that number was. Discussion followed: $31.5 million budget for 1991-1992; that that number was being compared with $30,741,000; that $500,000 would not be transferred to the CIP; that Departments would identify impacts on services in order to stay within appropriations in the event of cuts; Councilman Yee did not have a copy of that report, and questioned how the MOU that would increase the budget were being handled by the departments; that each department was supposed to absorb the cost of their labor contracts going into this budget year; that some depart- ments could not absorb those contracts without laying off people because 90% of the budget is personnel; Councilman Yee had a problem with $40,000 in conferences and seminars when that money could be used to forestall laying off employees, and he would forego any conference money as a Councilman to keep needed services; he wanted to set priorities on capital improvement outlay of money; Mayor Pro 6/17/92 Page 5 A6ENDA ACTION TAKEU '- 166 Review - Continued. Tem Teglia noted that the City had a hiring freeze; City Manager had instructed each Department to scrutinize vacant positions, however, it was not a blanket freeze in hiring and service to the public as a whole was being main- tained given the economic conditions; he believed that the Council in the course of the year should undertake a wholesale review of baseline levels of service. Discussion followed: that the Council imposed a franchise fee on the sewer operation equivalent to 7% as imposed on garbage collections generated in the City; that it was 7% of income in the sewer fund as a result of revenue generated within our City; there was a cost allocation on every enterprise fund that was supported by general fund acti- vity paid whatever amount was supported by general fund functions; sewer fund charges to home owners was $104.00; interest income rate was 6% per year; that the State could freeze the clock until the budget was adopted; Councilman Drago stated that whether the State takes away $1,000,0000 or $3,000,000 in revenue from this City, the exercise department heads were going through now would be gone through again after the loss in revenue was known; City Manager suggested author- izing interim spending for one month until the State's position is crystali- zed; Mayor Pro Tem Teglia felt the budget should be adopted so the employment force knows what Council's intentions are, and everyone understands that if the State gives us a large hit - all bets are off and the budget is revised; if Council adopted the budget, staff could identify the ramifications of a $1,000,000 or $3,000,000 cut from the State; League of Calif. Cities feels the State is going to concentrate on the property tax ($1,000,000) more than the vehicles tax ($2,000,000); that the Council could adopt 1/12 of the budget, which is one month with the exception of those that are annual services and maintenance; Councilman Fernekes concerned over how 6/17/92 Page 6 AGENDA ACTIO, TAKEN ,- 167 "-. Review - Continued. the departments could budget with only a 1/12 of a lower allocation when there were salary increases effective 7/1/92; with a State cut the City would have to look at keeping positions vacant and forcing positions to be vacant even though the budget is largely personnel; that this was not a balanced budget to begin with in view of the $1.2 million deficit; Councilman Drago was concerned over the magnitude of consultants ($90,000), overtime, conferences and travel (over $40,000) when the Council had to look at laying off employees, and would not vote on this budget; Mayor Pro Tem thought that staff could justify the consultants, and if not, take it out of the budget; Councilman Drago felt that the $3,000 for retreats, $10,000 for assessments centers should be cut rather than layoff employees; Councilman Yee suggested that rather than having Councilman Drago not vote on the budget, cut items the Council agreed on such as travel - and he could identify $180,000 in capital outlay items; City Manager wanted some general guidance on limiting conferences to zero or some amount or dealing with capital outlays, and afford staff to do the work to deal with the competing needs of the operations; Councilman Yee felt that conferences that were not reimbursable or could not pro- duce a grant should be limited or deferred; City Manager stated that there was some training that was not reimbur- sable in law enforcement that has to occur, and he would identify the net cost to the general fund and the reason for participating in those sessions. Discussion followed: State mandated costs; reimbursable costs from Mr. Dean; set aside funds that could be used for housing efforts, and were not general fund dollars; $10,000 for community mediation services; congestion management plan; computer aided dispatch had been staggered over a 2 year period and there was $150,000 in the budget for the soft wear for the system; $18,000 for C/CAG 6/17/92 Page 7 .- 168 AGENDA Review - Continued. ACTION TAKEN obligation; $22,000 unspecified con- tingency fund; sales tax audit was bringing in new funds to the City with 25% going to the firm for two years in new sales tax; $20,000 for traffic safety Councilman Yee felt was not a high priority; he also felt that retreat faci- litators for $3,000 could be dispensed with; Mayor Pro Tem Teglia had a major problem with spending $10,000 on the com- munity mediation program. City Manager stated that the Council could eliminate the $22,000 for con- tingencies, and he would provide further explanation on the $20,000 for lighting studies. Councilman Yee stated that the $10,000 in community mediation made it over $30,000. Further discussion followed: Councilman Drago did not feel the City could afford $7,300 in staff retreats and facilita- tors, and wondered how many more retreats were buried in the budget; Manager responded that he would investigate if there were any; that the Manager would come back with the suggested $1,000,000 department cuts after the 30 day budget extension with identified impacts on ser- vices; Councilman Drago felt that the Manager should look at his management staff when the reductions come; Mayor Pro Tem Teglia wants a written explanation of Assistant Fire Chief having respon- sibility for disaster preparedness rather than the shared responsibility with the County; Councilman Drago felt that the semi-freeze going on is going to start hurting the City in six months because there were already complaints on landscaping on Hillside, and thought the line people should be left alone; Mayor Pro Tem people did not agree, and thought it would come to a four day work week rather than a five day work week; Councilman Yee felt that Council should prioritize any layoffs, and Manager recommendations should come back to Council before action is taken; he would 6/17/92 Page 8 AGENDA ACTION TAKEN . 169 Review - Continued. prefer that administrative staff was the very first cut, and the rest be prioriti- zed; that the Manager's direction to departments had been a 5% cut in the aggregate. Councilman Drago stated that he would like to see what programs the departments would put up to lose, and what programs had outlived their usefulness, and the Council would prioritize them. City Manager Armas repeated what he con- sidered to be Council direction - don't put forward something for the sake of it being cut. Mayor Pro Tem Teglia stated that she wanted to see those that are going to be cut, and a defense as to why they had a lower priority. Councilman Drago noted that San Carlos was still putting forward a balanced budget that include the necessary cuts. City Manager Armas stated that he would come back with reductions that will be described in terms of programs and ser- vices, and then positions that will go. Discussion followed: to scrutinize the overtime level in departments in view of layoffs; creating a new coordinator posi- tion for solid waste management board; State requirement that communities need to reduce the amount of material going into the landfill by 25% by 1995, and 50% by the year 2,000, and requires some plans to be made dealing with the overall recycling and household hazardous waste; the coordinator will serve three juris- dictions, and will be responsible for making sure there are efforts to educate the public in order to meet the State requirements; the cost of the position will be paid through Scavenger monthly fees; that under the Scavenger franchise agreement this was a pass through cost to the customers; that Council approves Scavenger rates to make sure there is 6/17/92 Page 9 AGENDA ACTION TAKEN Review - Continued. sufficient funds to cover this cost; a rate proposal would come forth next month for the Scavengers; this was a State man- date without revenue being provided; that this City was the lead Agency, and the coordinator would work for the Public Works Director; Councilman Yee questioned why a laid-off person could not fill the coordinator position. Mayor Pro Tem Teglia stated that there had been a substantial drop in overtime for both police and fire which concerned her. She stated that in the past she and Councilman Nicolopulos had gone through overtime figures case by case, and in most cases it had been justified and in others where we had no choice and a policeman had to appear in Court. Discussion followed: that the depart- ments would feel more comfortable to augment the overtime amount; that actual experience in booking and transporting prisoners to Redwood City had been less than the $240,000; that the northern cities had been working on an alternative to simply booking everyone because a majority of that relates to under the influence in public, and with the closure of the Mission facility have established a drop off to sober up the people and not transport. Police Chief Datzman stated that the Department had prioritized programs and had deleted the following from the budget: the hit program overtime, and narcotic enforcement stakeouts in the community for $24,000; $64,000 for jail transportation overtime; training overtime of $20,000 even though mandated by the State including self defense training; which included $20,458 for investigative overtime; had altered detective shifts; this approximated $120,000. Mayor Pro Tem Teglia questioned the drop in the fire department, and wanted to know its relationship to minimum manning. 6/17/92 Page 10 AGENDA ACTION TAKEN Review - Continued. Fire Chief Stark stated that that recom- mendation had been developed in an effort to remain consistent with the direction of the Council, and maintain the integrity of our positions. He stated that he was not in a position to tell the Council that it was good - it is workable, and was the lesser of two evils when you need to make cuts of that magni- tude that are in personnel. He stated that the goal was to save the positions we have, and to maintain the integrity of the entire fighting team by reducing the daily staff from 21 to 20 to augment the response to structural fires without an additional engine to respond and assist the truck in their function in a fire. He stated that the real impact was not so much on the initial fire, the real impact comes from additional alarms that come in from the time we are at the first fire. He stated that then you would see increased response time because of responding to the first emergency, and you would see utilization of the mutual aid plan. Mayor Pro Tem Teglia questioned how this would affect the City's favorable fire rating. Fire Chief Stark stated that the ISO would not be coming back for ten years for a new rating. Discussion followed: that the Fire Dept. would fight to get the minimum manning back to 21 when the economy was better; that the Fire Dept. would look at the management team, public education programs, and training for budget cuts before the elimination of positions; types of fire calls; Councilman Drago wanted to see a record of the last five years of major fires, and the number of times two fires occurred at the same time; Councilman Yee noted that the Police Dept. submits a monthly status report on calls, and wanted to see one from the Fire Dept. 6/17/92 Page 11 AGENDA ACTION TAKEN ' 1-/2 r 1. Review - Continued. City Manager Armas stated that the Historic Preservation Program is funded at $10,000, and a memo was received from Commission that it be increased to $20,000 which is detailed in the supple- mental requests. Mayor Pro Tem Teglia stated that the Commission could set priorities for the times there is more funds. City Manager Armas stated that there was also material on reclassifications, as well as a classification study, which is reflected in some MOUs and in some admi- nistrative procedures that allow annual reclassification reviews. He stated that three reclassifications had been reviewed and were being recom- mended by Department Heads: one in the Garage; one in Engineering; and one in the Police Department. He stated that based on the process in place he believed they have met the test to justify reclassification, and the annual cost would be $10,000 that was not in the budget. He stated that his suggestions was that if the Council wanted to do the classi- fication study, it not do the reclassifications. Councilman Yee stated that often the City hired an individual to do a certain job, and after a year or two the job usually is expanded to more than what was inten- ded; then we have to do a reclassifica- tion study. He stated that something was wrong either with the employee or the position. Mayor Pro Tem Teglia stated that the City did have employees that have special talents over what we hire them to do, and this City has gotten away with a lot of cheap service rather than hire more people. She stated that generally the employee is of the expectation that this is being appreciated, and then the 6/17/92 Page 12 AGENDA ACTION TAKEN 173 Review - Continued. employee knows he is being exploited, and she felt the City should not take advan- tage of its employees in that way. Councilman Yee stated that it happens in both directions, but he did not think that in each case it happened like the Councilwoman described it. He stated that he was personally aware that when the people get in there and clearly know the position and duties, then they rock the boat and say hey, I do more than I'm supposed to -- do a classification study. He stated that this bothered him, because they knew exactly from the beginning what the job was. Mayor Pro Tem Teglia stated that she agreed but at the point that the City recognizes this by a study, and then the Council has a choice to make - either you curtail the activity and pare back and pay him for what you hired him to do and not for the expanded job. She stated that over the years she had seen the City haggle people that were providing a service that changed over the years, and we didn't reclassify them. She continued, when the individual retired we could not fill that position, and had to augment that. Councilman Yee stated that he did not disagree, but it is not every case that fits into that category. Councilman Drago stated that he agreed with Councilman Yee, and questioned if the reclassification of the PST was a brand new title being created. Police Chief Datzman stated that the position was one that is responsible for all of the telecommunication service in the City and some really complex duties involved. He stated that he had looked at it for many years before he was con- vinced, and after that had a difficult challenge to convince the City Manager. He continued, it had then gone out to an 6/17/92 Page 13 AGENDA Review - Continued. ACTION TAKEN 174 independent consultant firm who had recommended a greater salary than the City Manager had, and now it was a question of whether the Council agreed. He stated that there were only two people in this Division, the other being Daryl Jones who is putting together our entire computer system at a savings of $300,000-400,000. He stated that when Department Heads have the opportunity to save money by having this service in house it was a cost effective way to uti- lize our resources on a consistent need. Discussion followed: on the duties to be performed in the reclassified position; that the duties of pulling wires through buildings and all other functions should be fully spelled out in the job specs, so he will not come back for an additional reclassification. Councilman Drago stated that he was against title changes and if that is the case for reclassifications then why not establish apprentice, journeyman, and then superintendent so it is consistent with private enterprise and get away from each person having their own title. He suggested giving him a raise as a Police Service Technician now, for a telecom- munications specialty give him 5% -- what you are looking for here is a $5000 a month increase or 25% without going into another title. He stated that any Senior Typist Clerk can be justified to be a Secretary I for it is now a foregone conclusion now that once these people have put it down on paper, then we are the bad guys if we say no. He stated that the Mechanics Helper, and Equipment Mechanic are existing categories and he had no problem with that because it is the appren- ticeship concept. He questioned if the five benchmark cities had been reviewed to see if the five cities have a communication system 6/17/92 Page 14 AGENDA ACTTON TAKEN ' 175 Review - Continued. la. Report on C/CAG Meeting. technician category. City Manager Armas stated that they had, but they do not have that position. Police Chief Datzman stated that the pro- fessional classification study had been done for this position, and the $500 raise was less than recommended by the consultants. City Manager Armas stated that the salary recommendation was linked to the Senior Electrical Technician, and this position was not found to be suitable in this case for the work performed. Discussion followed: that the PST had been with the Police Dept. for six years; this had been before the Manager for three years for an upgrade; whether the job scope had been run through Pac. Tel. or PG&E to see if they had an equivalent position; the consultant felt this posi- tion would be paid $300 or $400 higher in the private sector; in other cities this was contracted out because of the expen- se; Councilman Drago had read that usually consultants were people fired from somewhere else; Councilman Yee was concerned that even though these three positions with four individuals were justified this becomes a habit when a job duty next to you gets upgraded $500 then the "why not me" syndrome brings problems; that Councilmen Yee and Drago would not support a classification study. Consensus of Council - To authorize the three position reclassifications. City Manager Armas requested direction on the low income youth fee assistance program as requested by the Director of Parks, Recreation and Community Services. Consensus of Council - To authorize the low income youth fee assistance program. Mayor Pro Tem Teglia related that tomorrow night there was a C/CAG meeting 6/17/92 Page 15 - 176 AGENDA la. Meeting - Continued. e Closed Session for the purpose of discussion of personnel matters, labor relations, property nego- tiations and litigation. RECALL TO ORDER: ACTION TAKEN that she would attend for the Mayor, and proceeded to mention things for discussion: suggestions on conditions that might be considered for the Airport expansion; three workshops to be con- ducted by the Airport on noise, housing, traffic and general impacts; only 15 residents had attended a recent workshop, and input was being taken from 20 tech- nical people from agencies and the Airport. She related the following: they are not taking our need to insulate and putting it in a more positive frame; comment was made to identify the maximum number of homes affected and to insulate 10% per year over a ten year period; she wanted support for staff to present similar language to C/CAG to bring forward; Peninsula Developers were having some elected officials writing letters to pre- sent the Developers particular agenda for housing in the near proximity of the Airport; a concerned citizen had questioned why housing near the Airport was being promoted when for all of these years they have been trying to remove houses from the impacted noise areas, and that was removed from the ALUC recommen- dation to be forwarded to C/CAG; she felt that there were substantive efforts by the Airport and Airport Commission to come up with some substantial mitiga- tions; that Brad Kerwin was for the housing; she wanted dollars in the bank from the Airport for X number of houses, etc. Council adjourned to a Closed Session at 10:00 p.m. for the purpose of labor nego- tiations with AFSCME pursuant to GC 54957.6. Mayor Pro Tem Teglia recalled the meeting to order at 10:25 p.m., all Council pre- sent, no action was taken. M/S Drago/Fernekes - To adjourn the meeting. 6/17/92 Page 16 AGENDA ACT];ON TAKEN 177 ADJOURNMENT: RESPECTFULLY SUBMITTED, Barbara A. Battaya, City I~)'erk City of South San Francisco Carried by unanimous voice vote. Time of adjournment was 10:25 p.m. "-~n R. Penn. Mayor City-of $o,,th S~n Francisco The entries of this Council meeting show the action taken by the City Council to dispose of an item. Oral communications, arguments, and comments are recorded on tape. The tape and documents related to the items are on file in the Office of the City Clerk and are available for inspection, review and copying. 6/17/92 Page 17