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06-05-1967 - Regular Meeting - MinutesMINUTES OF THE ADJOURNED REGULAR _MEETING OF THE CITY COUNCIL CITY'OF WEST COVINA, . CALIFORNIA JUNE 5, 19671. The adjourned regular meeting of the City Council was called to order by Mayor Krieger at 7: 36 o'clock P.M., in the West Covina City Hall. . Councilman Gillum led the Pledge -of Allegiance. ROLL CALL Present: Mayor Krieger, Councilmen Gillum, Nichols, Gleckman,: Snyder Others 'Present: George Aiassa, City Manager H .. R. ,Fast, Public Service, Director Owen Menard, Planning -Director Robert Gingrich,: Director of Recreation & Parks Lela Preston,, Deputy City Clerk Ray Windsor,,Administrative,Assistant Kirk Wilson, Superintendent of Recreation Andy Hunter,: Supervisor of Recreation .Recreation and Park. Commission: Mrs. -Frank Plesko, . Vice -Chairman William H . Johnson Harry J. Kaelin Robert Nordstrom SWIMMING POOL .REPORT JOINT MEETING WITH THE RECREATION AND PARKS COMMISSION (.Mayor. Krieger greeted the Recreation & Parks Commissioners, . stating that the Chairman Mr. Veronda was out of town and that Mrs..Betty -Plesko, Vice -Chairman would officiate. ) Mayor. Krieger: I notice in the audience certain members of the Citizens Blue Ribbon: Committee on the West Covina Swimming •Pools, who obviously have a continuing interest in .their report. This is the time and place for the council and the commission to discuss the report itself. I know the report has previously gone fo the Recreation and Park Commission for their consideration. Mrs. Plesko: Yes -we have been given copies of the -report, but it has Vice -Chairman not been on our agenda. Mayor Krieger: I assume the members have had an opportunity to review the report. . Have the members of the Commission any statements or comments to make individually with reference to the report? .We appreciate the Commission has not taken an official posit_ion','as -a! Commission. . Mrs. . Plesko: I haveread .all of the Committee reports and I think the Vice -Chairman Committee certainly deserves a big hand of applause for doing a very, fine job. Much research has gone into it. .As faras I am concerned personally, .I would go along with their recommendations as far as the tax is concerned, whatever the City Council wishes to call it. I feel this would certainly be the way to go, having lived through many bond issues and discovering the apathy that exists during these bond elections and the expense the City -1 - ADJ.. C.. C. 6-5-67 Page Two SWIMMING POOL REPORT - JOINT MEETING RECREATION & PARK COMMISSION gets itself involved in. .I think this certainly would be the most economical way to go. Commissioner Nordstrom: I certainly endorse the sentiments of Mrs. P1eskQ. :.I ® would, myself, like to extend to the members of the Blue Ribbon Committee my heartfelt sentiments and a -real sound round of applause for the terrific job each and everyone of you performed for out, City. I I certainly do endorse the report, each and every page. .I have mixed emotions as to the W tax, which is ,emphasized in here, but after due consideration on my part, .I can see no other alternative except to proceed on a strict paY-as-you-go basis, which will be the most expedient and economical to our City. .Overall I endorse the report. Commissioner Johnson: I endorse the same comments the other two have made. I have only one ,additional remark due to seniority. .I have been down the stream several times on bond issues over these pools from the beginning and that is our biggest problem. Our community spirit is that we want to get going and get something done. -We get a reasonable amount of lip service but when it comes to the election we run into an unreasonable amount of snags. . So in other words I endorse, and feel we should get going and get off the dime. • The basis for my feeling is the fact that we have spent a considerable amount of time over the last 8 years on this type of situation and we are almost at the point if we wait much longer we are going to fall behind as a.City and in the needs and wishes of our City, and only the fact that we do not have enough communication in this.City is the big fact that we have not been able to get these things over. My main reasoning here is we want to get going and the longer we wait the more the land will cost, etc. , So I am for getting started as fast as possible. Commissioner Kaelin, Jr.: I like the report very much and I endorse everything everybody said ahead of me. I would like to emphasize though that what I got out of their recommendation was that although at the time our current requirement is for 4 pools, I seemed to get out of it they wanted to go for 1 .pool now. Also the Public Relations and Publicity Committee has given a very brief report because they haven't anything to go on for the moment. If the council decides we go ahead, I suggest a big drive on publicity be put on. .As far as the 10� general tax fund, I don't know if that is enough or too much, but I agree that is the way to go. Mayor Krieger: Thank you. Councilman .Gillum, this was a . Committee that you acted as council liaison. You might care to make_som.e-)ihi'tr.'dductions.of the'.Confnitte-.rnemnb.ers::that are sitting in this evening observing the discussions. Councilman Gillum: I would like to introduce the two Co-chairmen, Dr. Madden and Mrs., Knutsen and let them introduce the Committee members that are present. (Introductions were made.) I would like to mention at this time, if you ..had .,_ seen our first meeting and gone through the whole procedure with us, and see what we ended up with on the report - well it is something that is hard to • believe that it could have happened - - but it speaks very highly for the people involved. At one meeting we had husband and wife on separate sides of the question. (Gave a background summary on committee meetings.) I for one would like to commend all of them for some hard and serious thinking and dedicated work -and some strong and open discussion on some of the points pertaining to the Swimming Pools. - 2 - ADJo . C. C. &;'S-67 Page Three SWIMMING POOL REPORT - JOINT MEETING RECREATION & PARK COMMISSION - Continued 'Mayor Krieger: I am sure I speak for the council whenI again compliment the Committee for the work that went into the deliberations that ultimately lead to the recommendations. I am particularly happy to see so many of the members with us this evening to at least observe the action that will now take place on the Committee's recommendations. We have a hard and firm recommendation from this Committee , which Councilman Gillum says was an unanimous recommendation by the Citizens Committee. .I gather from the comments made by the Commissioners this evening, in the absence of th-e Chairman, Mr. Veronda only, that the Commission itself individually concurs in the recommendations of this. Committee. .Mr. Gffgricd'did-you-have something you wanted to add to this ? Mr. Gingrich - Director of Recreation & Parks: Mr. Veronda's wife called me today and he left a message with her that he was sorry he could not be here tonight, but he fully endorses "the recommendations . in �: terms of the need of pools as the Committee submitted and agrees with the method recommended for financing, unless some other feasible method is forthcoming from the City Council, and he,feels strongly that we should take advantage of the Committee's offer of serving in the area of publicity. . He sends congratulations to the Committee fora fine job. Mayor Krieger: Then we have individually received the opinions of each of the members of the Recreation. & Park. Commission, subscribing to the recommendations of the Blue Ribbon .Committee. It is appropriate at this time to open for council discussion as well as questions of the Recreation & Park Commission as well as any questions that may be directed to members of the Committee that are present this evening through the co-chairmen. Councilman Snyder: May I ask a question first --- since obviously this recommendation asks for a tax raise which has to be applied each year if we were to embark on a program of 4 pools on a tax raise, obviously this would not be binding on future councils, so I think the proper way to approach is on a priority basis and therefore under B on Page 8 of the report you read: "Number 1 on Edgewood High School " as your priority swimming pool location. I don't think on a year to year tax basis that you can bind future councils to any program. Mayor Krieger- Dr. Madden or Mrs. Knutsen, you may wish to respond. I gathered this was not only a.list of total number of pools, but also in the priority the Committee recommend- ed. .Is that correct? Dr. Madden: Yes, by all means. I would like to add there has been what I consider a misinterpretation. .In some cases some people have apparently interpreted that we were • looking for one pool and to make a decision later on in area. In fact we are saying that our current need is for 4 pools as we stand now and if in the future our population increases that we may need additional pools at some later time, but as our recommendations indicated, that this tax be intiated in.July and continue until we have 4 pools. Councilman. Snyder: The purpose of my question is - given a single pool and that doesn't meanI am for a single pool, but that if _3- ADJ. C. C. 6-5-67 Page -Four SWIMMING POOL REPORT - JOINT MEETING RECREATION & PARK COMMISSION _. Continupcl things should change and that is all we end up with, I don't know which one you want first. -Mayor-Krieger: I think the point that Dr. Snyder raises is a very valid one. The council might subscribe to the philosphy of the report itself, but as far as the funding consistent with the recommendations in the report, find that you only ultimately accomplished one :pool. .I think that emphasizes the importance of that question. Councilman Gillum: I tried to - - as much as I am in favor of the Swimming Pools and the program - - I tried to stay as far out of the discussions as much as possible. They would ask for information and things of this type, but this was their decision. I feel. that as stated ,by -members of the Board and the Blue 'Ribbon Committee that we know we need the ..pools. We have tried and tried to put it through on bond elections. I was reading in the League of California Cities or one of the publications we subscribe to, that swim- ming -is going to be the number one recreational activity in communities in the next 5 to 10 years. I would, as one councilman representing the people of this community, I would strongly recommend to the council that they give this report every consideration. I know it is difficult as elected councilmen to talk about raising taxes. There seems to be a very strong movement throughout our State and the Nation, in opposition to taxes but I truly can't see any other way of providing something that is not a necessity but is a very large asset to our community. Tonight we are also discussing a contract for our- new Civic Center, this adds to the City of West Covina, but I think swimming pools also add. I might pass onto you - that during a conversation with a women in opposition to one of our current programs - we got to the subject of swimming pools and she said she would be in favor of supporting a tax increase if the money would go for that purpose. .Many people -I talked to are in favor of it. •So I would hope you gentlemen would give this consideration. And under this method proposed it is the least expensive way of providing something we need in this community, especially with the number of young people we have. Again I wish to say that the Committee spelled out in their recommendations their true thoughts and views. Councilman Gleckman: I have a couple of questions. Mr.. Gingrich, I also would like to commend the staff for the job they did as liaison with this Committee, but I didn't see anywhere where the discussion actually pertained to the use of these pools by the people or by the community and the people in the community other than the school children. Does the Recreation & Park Department have some plan in order to use these pools when not in use by the schools or are they to be used exclusively by the schools ? Mr. Gingrich: There has been no program laid out or proposed with the schools, but in discussion with the Committee the thoughts and ideas were they would be used for the educational program during the school year and when the time of the year was decent for swimming in the evening and on weekends during the 4ckool year and all the time during the summer months. There was also considerable discussion about the availability for recreational uses during the summer time and the possibilities of changes in the school program and whether the school would be used for summer school, etc. I think -it was the general thinking of the committee that in the agreements with the school. -district that they would be available for recreational swimming during the summer months and weekends and evenings during the school year. There may be - 4 - -ADJ. . C.C. 6-5-67 Page'Five SWIMMING POOL REPORT - JOINT MEETING RECREATION & PARK COMMISSION - Continued times during the year when it would not be practical to open the pools at night, because you would not have that much demand for it - say in December or January. Councilman;Gleckman: How about the initial cost of this first pool of. $135, 000? • How does the size of this pool compare with .Charter Oak's pool ? Mr. Gingrich- I believe we have this information in our resource material - Mr. Hunter tells me Charter Oak has two -separate pools.-. They have a swimming pool and also a diving pool. . It is a different type of structure as far as the pool itself is concerned. Councilman Gleckman. I think the two things that are going to be necessary that this- council. discuss, as Dr. .Snyder brought up - I also agree with the idea of 4 pools, but I also am interested in seeing what use the City would make of the first pool. I think getting the first pool is the important thing. .And from that point on we can see what use and need other pools -would be'to the City. I am getting into the technical points now, but we have to in order to justify a tax raise to the entire population. We have to spell out the cost of the pool as far as a tax raise, so that people understand we are not just raising taxes 10� but what it actually means to them per valuation and where that money is going. - So it is not a case of us coming along as a..Council and just accepting a Citizens Committee report and raising taxes 10�. I think there is a lot of public relations work involved. I think the Committee did an .excellent job in spelling out to this council and this commission as to what they can justify and what they have found would be of great de- sire. .Again there is no doubt in my mind about the 4 pools, but I am thinking about 'justifying it and explaining it to the entire xity, because the entire city are the ones that have to pay, for this. Councilman .Nichols. I am afraid I feel som ewhat like the one who went into a revival meeting and during a whole course of "amens" got up and said "to heck with the preacher.. " As the gentlemen of the council know, I have tried to hold rather consistently until relatively -recently to a basic premise I have and that is that the devices that are being used so oftentimes nowadays to achieve things are still in the final analysis a circumvention of, -.the wishes of the final majority of the people in our community. .It is terribly un- fortunate that many of us feel that we desperately need and desperately want and the route sometimes we go is the route I have not always been able to follow. I initially objected Very strongly to the approach of moving ahead to obtain a Civic Center and the Police Station, which is being done 'on a bonding program after a defeat at the polls and I finally compromised with my basic philosphy in this area, because:I felt it was an absolute and imperative essential need in our community. I think because I am a school person by profession and work with young people I appreciate the value and need of one or more pools in our community as much as most. I very much feel that we have to also look at it from the standpoint - I know there are people in the community that feel very strongly we should raise taxes to provide riding trails; I know there are some people also that feel we should raise taxes to provide more men to man the streets; and more men to repair the streets; and there are some people who ® think -we should pay more taxes to help improve the -Little League'Fields; and on and on it goes with all those people saying things they want and they are each saying their cause justifies taxation and each of them screaming, rightfully so, about the increases in property taxes imposed by other people with their interests. I recognize for me to pick and choose between these areas and decide which.ones'I would advocate raising .taxes for, is a great responsibility indeed. - 5 - ADJ.. C. C. 6-5-67 Page -Six SWIMMING POOL REPORT - JOINT MEETING RECREATION & PARK COMMISSION - Continued Certainly I would say that .I think it would be a great and tragic mistake for the council or, the Recreation & Park Commission, or any body representative of the Commission to say we want 4 pools, 1 - 2 3 - 4 and this is • the first one, get ready people for 3 more Because, I think it will cause for us largely what happened before, in that the masses of the public were not ready to spend ' one million dollars for swimming pools. So I would feel somewhat like Councilman Gleckman that I think we all in our hearts know that the community needs additional pools but that we should concentrate our fire and efforts on that first pool and demonstrate to our community what it can do for the young people, the school program and the general attitude towards pools. If the consensus seems to be at that time that we can go for that pool and should go for it and the council in its majority feel that this is one of the issues or the issue that should involve the -extra 10� rate to maintain, then I will take my vote, based upon my feelings about taxation-, in the council for whatever that decision may be. .If I can go along with the decision positively, fine - if I can'tI certainly will not be'a negative force in terms of helping to implement and achieve those things. I think the report is a splendid report and if the council determines to move in this direction it will have my wholehearted support, but • I would be hypocritical to myself, the council, and to you on the committee and our commissioners, if I said that I could concur in the approach as an automatic one to just add that 10� rate to our tax to achieve the pools. Councilman Snyder: I would like to say that the people on the city council, the Recreation & Park Commission and the committees that worked in'57 -' 60 -'61 and'65 must be very gratified by the results of this report, because of their disappointment in those years. Certainly everyone that has run for election in my recollection in West Covina has talked about the need for pools. .I think we makea mistake if we give the impression to the press or the -public that it is necessary to raise taxes 10�, it may not be. All they are saying is that we set aside W of our tax for pools Now we haven't studied the budget in total, we have to balance it out, one against the other, we may not have to raise taxes that much. All they are saying is that we have to take W of our tax and turn it. over to the pool. .We may decide to do without something this year and not raise the taxes and there may be other methods. However, I am convinced that there is not only a desire but a need for pools and that the majority of the people would not object to a reasonable tax raise for financing. .I think we have to go on a pool by pool basis because we cannot predict or bind future councils. And I think we-ihave to plan it that way. The next council has to decide whether they want to build the second pool or not. I think during the budget sessions that the staff should be prepared with alternate methods of financing or the Park -Section might be considering doing without buying a park this year - - other than just saying a flat 10� tax raise. .If it is necessary and .I decide it is necessary for it I can vote for it. The point -I am saying is we should not give the public an impression that a 10� tax raise is the only way to go. The Committee is just saying that we set aside a 10� of the tax rate. ® Mayor Krieger. . I think each of the council has focused on a particular area which is quite true and irrefutable. This, of course, is where the bus stops and final decision has to be made on the particular subject matter. It strikes me somewhat significantly that the four bond elections we have had in the last ten years showed an increase in percentage of people in favor.' of pools from '57 to 60 to 61 and in 1961 it got up to just a little less. than 66% and we were just a few votes short and the proposition. was two pools at that tivie. I think back to when we had discussions on this council in the 1965 bond election, how we got to the point of four pools. It 6 is still not clear to me exactly the wisdom of ®- ADJa 6 -5-67 Page Seven ,.SWIMMING POOLS REPORT - JOINT MEETING RECREATION & PARK COMMISSION - Continued i the compromise that was made by the council. in '65 in putting four pools on the ballot. T°do-remember distinctly in order to get an unanimous council at that time to support that- particular bond proposition that was the only way we could do it. .It went down not •to -a-majority defeat , but to a legal defeat because we only got 51%. But it was significant to me that 15% of the people four years later were less in favor of four pools -and apparently were in favor somewhere along the line by this percentage for two pools. Maybe it was going from rags to riches. I have heard many analyzes -of the '65 bond election as to what caused what and why and .I don't think anybody has the answer to it. Although it seems to me a fair observation is that we were going all out for a -$750,000 bond program for pools, not having any pools at all. In any event we have .a committee recommendation and a concurrence by the'Recreation & Park .Commission .,-where the thesis of the four pools -is carried over. .Geographically it makes sense to me., because if four pools were constructed in 1967 West Covina, you have the city pretty well covered on the north, south, middle and both ends. The second point that it seems to approach, is this question and we discussed this on the four pools in 1965, and we also discussed maximum usage - that the pools would not $*It around unused during a greater part of the year. .I also remember the council then meeting with the School Districts, both •in,Covina and West Covina school boards and the boards indicating to us that they could not support a pool at one high school location unless there was a pool located on their high school grounds and unfortunately in the context of this discussion we were served in our high schools by two school districts and we were at a sort of unhappy impasse, as,I remember with our meetings, with the school board as to where did the wisdom come into this consideration and what is the right answer. In 1967 what concerns me is the recommendation that this. Committee brings to us. . It is not the financing that disturbs me so much, I think it is what Dr. -Snyder says, particularly about the ability of this council to :chart a road map that would be binding on future councils or future funding, because that would be the key to it - the funding require- ment, year after year. Wemight adopt the philosphy of it and I have the•same questions that Mr..Gleckman and Mr. Nichols have in .this regard. The majority of the council might adopt the philosphy of the four pools and yet never get to the point of realizing the four pools because the money is not going to be appropriated in future years to accomplish this. The 10� 'recommended, if I am correct, would bring in .about $100, 000. That would still leave us, even on the first pool if your costs are anywhere close $135, 000; still leaves you coming up short on the first pool and it certainly leaves you without any funding on the next three. The Committee says 4 pools under priority, accomplish 1 and then go on to the others. It is not even within our legal capacity to accept that part of the recommendation except as a matter of philosphy because we would then, in succeeding councils get to the budget in terms of "are you now going to fund that next pool as it comes along" - - it is not even within our legal capacity to accept that part of the recommendation except as a matter of philosphy. I feel that the council ought to concentrate on the philosphy of the possible for this council; and even on the Commit(tee's recommenda- tions, the possible for this council would be 1 pool and maybe a little short of the funding for that. So we might as Dr.. Snyder stated, if we did not have to entertain ® a consideration for a tax increase, still go $135, 000 into the general fund, which is quite a slice of the pie, in terms of the total budget that we are considering and the regular housekeeping commitments that we have day in and day out and that we have very little discretion on. If we entertain consideration of a tax increase, specifically ear. marked for this, I think the most we could earmark would be for 1 pool and then tap into the general fund to make up the difference on that. Now we get to the question that I think is the next most serious, recognizing in essence we are probably talking about 1 pool - are we really willing to go along with that portion of the recommendation of the Blue Ribbon - 7 - ADJ� C.. C. 6-5-67 Page -Eight SWIMMING POOL REPORT - JOINT MEETING RECREATION & PARK COMMISSION - Continued Committee as to location? If the first location would be Edgewood High, I see an advantage,in this location in terms of maximum usage. Although we have not got into definitive discussions with the School Districts as to use and primary responsibility 0 which is something that definitely would have to be ironed out if we put it on school -district property. The only contribution the school district would make would be the property and we would have to be able to satisfy ourselves that in utilizing say $135, 000 of our general tax funds, whether on a 10� increase -or not, that we are getting maximum return for the broad cross section of the population and not a -restriction as to a small segment of the population, either in age group or geographical area. This is another thing that would bother me. I would like to see some serious discussion on the council as to the first location. Of course, it is within our power to put it back on the bond program. There has been a recent experience in,.Los Angeles, just last week, were two bond propositions, both very worthwhile, went down. Historically this has been true.-1--throughout the State of California within 'recent -years., bond propositions going down. The 66-2/3% I have heard this discussed on the Board of Supervisors, assemblymen, and state senators - 66-2/3% is a tremend- ously difficult thing to get across do any proposition. An election of 60% is supposed to be close to a landslide, yet there are certain propositions the State puts on a ballot and they only require 60% majority and we have the 66-2/3%. -I am strongly convinced that regardless of the number of pools, to put this on a bond issue is going to bean extremely difficult thing to get across. .On the other hand I think the members of this courmil, the members of the Recreation & Park Commission, and the people that have served on the Blue'Ribbon .Committee are very closely. attuned to this problem, having lived with it, many of them, for years and I think we ought to be able to confirm in our own minds whether or not this City needs swimming pools. I think we do and I think the first question we have to come to a decision on is whether -or not, we as a council, are willing to go to the general fund, whether it is by a 10'increase or some other method of dipping into:jthe- gehbral'. fund, the sources :I don't know. I have -a hunch we are note going to find it, looking at this budget, but ---whether or not we are ready to look into this funding right now for this pool will have to be answered. Councilman Snyder- . My suggestion is, we will be studying the Recreation and Park budget very soon and that the Recreation & Park Commission and staff come back with a budget proposal with a recommendation for a location of one pool. I think there is a consensus here and a reality that we can only think of one pool each year. I emphasize again, this doesn't mean we are against the other three. It is just the realities of the situation. I suggest the Recreation & Park staff come back with a report and a recommendation from the Commission as to location, cost, etc. Councilman Nichols; At the time we were putting the original proposal together, when we were advocating 4 pools, I spoke directly with .a high officer of the School District, which his position may have been, but he conveyed that the school district could not dscept the placement of a pool individually - one pool at one high school - without the placement of pools at other high schools. This was one of the strong things ® that contributed to the pools - so I would like to direct a question to Dr. Madden. Has there been any. contact with the School District officially in West Covina in terms of their attitude on one pool? Dr. Madden: No. The Sub -committee has met with .Mr. • Eastman, and the chairman of the'School Boardcame over and discussed in general the concepts with us one night. ADJ. C.C. 6-5-67 Page Nine SWIMMING POOL REPORT - JOINT MEETING RECREATION & PARK COMMISSION - Continued Councilman. Nichols: Mr. Mayor, I would like to take it just one step further, because I am afraid my initial comments weighed very heavily on the negative in the terms of taxation, and not strong enough in the terms of my concept of the terms of the pool. My personal opinion is that we owe to this, Gommittee and to our interested publica pledge that this council will:.an fact determine and achieve financing-tffictent -to-build at least one municipal swimming pool during the session of this current -counci.l. I would strongly support that, I would not commit to the type of financing or how it is going to be ready, but that this council should push ahead with the . clear declaration that we are going to build a swimming pool for this community, I would support 100%. Councilman Gleckman: Councilman Nichols in his last remarks took -part of the comments I wanted to make, but first of all you brought up the subject of location and .I think within the City of West Covina I don't think .location is that important unless we make it that important and I don't think it should be made an issue. .I feel if the necessity is here for a swimming pool and the recommendation of this. Committee was to start out with a swimming pool at Edgewood High, tY�itLWh6t.her we agree or disagree individually •with a particular location, I don't think we should make that the essence of whether we have a swimming pool or not,. If the necessity is here, the usage is going to be there and if the :people of this community want to use that pool I don't know of any location we could put that pool in West Covina and satisfyeverybody or any particular section of,the City if it is not in their section, but I do think if' they want a public swimming pool they have the means of transportation and know how to get there no matter where we put it, so I would not like to see that issue become one of the major problems or consideration of this council. I would like to adopt the Committee's recommendation that we start with Edgewood High unless for some unknown reason we can't get together with the School Board and the West Covina Unified School District and they would find some objection to that location. But, if it was good enough for this Committee to come out with it as a prime location to serve the majority of a particular area until such time there would be a need or funds to build another pool, I think this is the location we should decide on. .I, too, would not like to see a circumv@nti0'm' oc the -people. __ Irr thif.s.-.p'arti'rul'ar-.instance when this city council sits down with our City Manager who has sat down with his staff and we spend over four million dollars of this. Communitv..,s money, we do not take the particular issues or monies that we are going to,spend and put it before the people, or at least sit back and say we can't spend this money because we are circu.mvetiting the people. -As -far as:I am concerned a swimming pool is 8 years past due and.I think it will be another 8 years past due if we leave it to the people and I don't mean that I don't have faith in the people, but in the area of communication, in what to get across not only to our people, but people in .every community, you neverJ�.t`tl7ke 4;mdfo.rity of your, community out to vote, only those opposed are sure of going to the polls. So as far as I am concerned we are not circumventing the people, we have five councilmen elected at large by the people of this City and we should be able to make this decision not only because of past performance but because of the needs of this community and if we have to go back to the people to get them to vote on a pool then we don't need a ® pool. I am not for going back to the people. I don't think .it is necessary. I think the majority of the people of this City will vote for a pool and I as a city councilman elected by the people would cast a vote right now for a pool to get started immediately on the plans for financing and as far as the location, I am willing to go on record for Edgewood High. Councilman Gillum: I would like to add this for your information that the selection of these areas was after considerable amount of study and survey as to Location.. We, also, on the Committee were quite curious as to where our neighbors on the Committee were coming 5•- ADJ. . C. C. 6-5-67 Page Ten ... from. W�. found we had them from east, north of the freeway, in fact we had members from throughout the City and it was again an unanimous decision to place it - the first pool - at Edgewood High. Some of them would be clear across the City from the pool, but they felt because of the work by the Sub -committees and the information made available to them, that this would be the best location to start with the pool program. • Mayor Krieger- Let me go into this aspect a little more deeply. Mr. Nichols has alluded to it and this is what I am con- cerned about it. I am not concerned about location -,Per se. We only have 14-1/2 square miles, we are not that big geographically that .we will pick a location that will not be accessible to any area of this town. I think what .is extremely, important is the fact that if we are talking. about a pool that is not on City owned property and that we have to know for certain with the.T's crossed, the I's dotted, as to what the working arrangement would be with regards to the use of that pool. That is what is important, not whether it is Edgewood High or the southeast or the northwest. I have never looked at this town in this way and I don't think that anyone that is really attuned to ivha't-far4.going on in the community does, and .I hope there never is that type of partisanship. If there was I don't see how the five of us were ever elected, because everybody would choose up their sides and do battle. It has never worked out quite that way and I hope it will never come to that. , But when I talk about this as the first locationd think we have to appreciate the fact that the first recommendation involves property that is not city owned and we would • have to know for sure as to what type of a working relationship and arrangement we would .have for the maximum utilization. Secondly, pertaining to something Mr. Gleckman brought up, that is the absolute importance of this first pool. - I think this first pool is going to be the key to the whole program and .I would hate to see us fall flat on our faces on this first pool for any reason at all. That is why I rather think we should have -a consensus on this council that we do need a pool, that we are prepared to go forward with a pool, that we are going to raise the money for a pool, and the question is are we going to have all the facts to make sure that pool is in the best location possible for all factors? Councilman -Snyder: As a matter of protocol, :,Althb-dg'h we,have _ i., :_ c a Blue Ribbon:. Committee report, ,,we shouldn't circum- vent the Recreation & Park.. Commission and the staff, because even though this money. is being earmarked for pools, it is that Commission and that Department's money, so as a matter of protocol and proper procedure, this should go back to the Recreation & Park Commission and they should make the investigation you talked about and come back with a recommendation as to location of the pool. I think if there is a --consensus we can make a motion that we are in favor of one pool, but I strongly feel that responsibility should be put back in the Recreation & Park. Commission's hands and they should make the recommendation back to us in the budget. Councilman Gleckman: Why can't we discuss,1t. now while we have them here? Councilman Snyder: Because I think it has to be discussed as part of their total program and I don't believe they are prepared to discuss it. Councilman Gleckman: Well are we talking about taking some of their money away from another project in order to pay for a swimming pool? Councilman,. Snyder: As a matter of protocol we are taking away some of their function. -10.- ADJ.. C. C. 6-5-67 Page Eleven SWIMMING POOL .REPORT - JOINT MEETING RECREATION & PARK COMMISSION - Continued Councilman Gillum: I think there is probably a point also that no one has contacted the School Board. We would have to know this. We should have someone from the staff and the • Recreation & Park Commission to make these initial contacts and find out if we are in an area that we can operate and satisfy both parties. Councilman Nichols: The Recreation & Park Commission is here, the members 4n'&V duaT1y'have-re,a the report and each_, of them; one absent but we have that report, each have indicated that they subscribe to the report of the Committee. So I can assume therefore that this would be in fact their recommendation collectively if they were asked to present it in that way. Councilman. Snyder: But no one has talked to the School District. Councilman Nichols: No, but I am saying the Recreation & Park Commission has had an opportunity to look $t this report and has stated to us their consensus with .it and as far as the location of the pool I think that is something that cannot be pre -guessed. Mr. Mayor would,,:a motion be ,in order? Mayor Krieger: We have had a council discussion. Motion'by, Councilman .Nichols, seconded by Councilman Gillum, that the council go on record this evening as stating its intention to construct one municipal swimming pool for the City of West Covina during the 1967-'68 fiscal year. Motion carried on roll call vote as follows: AYES: Councilmen Gillum, Nichols, • Gleckman, Snyder and Mayor Krieger. NOES: None ABSENT: None Motion by Councilman, Nichols, seconded by Councilman. Snyder, that the council request the Recreation & Park Commission to take the councils' intention under advisement and working cooperatively with staff prepare for the councils' consideration the Commissions' recommendation as to the pool specifications and locations. Mayor Krieger: Is there a time for the return of this report? Councilman Nichols: This is some matter of urgency, but I don't want to make an unreasonable request. Mr. Gingrich what would be the minimum time you would feel the Commission and staff working cooperatively uvpuld need to meet this request? Mr.. Gingrich: If we are talking about working drawings then we need an architect as well; if we are talking about an architect entering the picture---- but if we are talking about the concept then about 2 or 3 weeks. Councilman .Nichols: Mr. Aiassa, would 2 or 3 weeks be in the framework of the budget? Mr. Aiassa: Yes. The fourth budget session is the 20th of June and that is a joint meeting with the Personnel Board. We could schedule a meeting. for the 22nd of June. -1.1- ADJ. 'C. C. 6-5-67 Page 'Twelve • 1.SWIMMING POOL REPORT - JOINT MEETING RECREATION & PARK COMMISSION - Continued Councilman Nichols: It would be my opinion that I would not want to stipulate,a date prior to the 20th becauseI believe it would be rushing the Commission. Mayor Krieger: Would you want to set a date? Councilman Nichols: No, only with all due speed, .Councilman Gledkman: I have a. questfcrn., Mr. Gingrich could you explain to me what information you would propose to prepare outside of what they :have already -received? Mr. Gingrich: I think it would have to be primarily a complete thorough review of the recommendations of the Blue Ribbon. Committee. Of course the size and shape of the pools our staff has worked with .this, we are in complete accord with -the size and shapes. .As far as coming back with a more accurate dollar value I don't believe this can be done without the added step of getting working drawings. Councilman. -Nichols: Councilman Gleckman it was fully my intention that a major item would be clarified which has not been mentioned and that is the location and..the implica- tions of the agreement with the School, District. Councilman .Gleckman: T Am.' I`= to understand that the Recreation & Park Commission and/or staff would make the contact with the School District and talk about'thisi particular situation prior to us summarizing the location? Councilman Nichols: Again I should clarify my intention. My -intention is that our Commissioners will go into this matter of location, the implications of this location, the pros and cons of this location, and review this with ,staff, make such contacts that would be desirable with:School District officials and be prepared, as the right arm of this council, to come back to us and say we confirm that this is the location and we are confident based on our conVenatl.a th.at'thi<s' 1 nation can be worked out, or that "no there are problems and we feel we should give some thought elsewhere. " Councilman Snyder: Also they should approach the matter of location that has been mentioned several times that this council. only has the power to build one ppol, sc they should build it as if they are building one pool without consideration to the others that might or might not be built. Mayor Krieger: This council has taken the first step only in that direction and that is in the concept of the one Opool. I think the next question we have to take into consideration , when we get this report back, which would be extremely advisable to have during our budget sessions, is what are we talking about in dollars and what are we talking about in location. Councilman -Snyder: That is my next question. The council has said we willfinance a pool but we have not in fact said to the Recreation & Park Department or any other Department that we are going to take any funds away from them that they have already budgeted. This may or may not be necessary, we don't know. - 12 ADJ. . C.C. 6-5-67 Page Thirteen', ,,SWIMMING POOL REPORT - JOINT MEETING RECREATION & PARK COMMISSION - Continued Mayor. Krieger- We haven't actually budgeted anybody's funds up to this point,. • Councilman Snyder- I am only saying. the Recreation & Park should not revise their budget Mayor Krieger: :Any further discussion gentlemen? Motion passed on roll call vote as follows - .AYES. Councilmen Gillum, Nichols, Gleckman, Snyder, Mayor Krieger NOES- None ABSENT- None (Mayor Krieger declared a 10 minute recess- Council called to order at9pomo) PUBLIC AUTHORITY- CIVIC -.CENTER DEVELOPMENT (Mr, Aiassa, introduced to the council the representatives from Stone and Youngberg, Mil° .-Hermes Ze1`lu�' anri [ra _ � rell9:-ands a °.Donald Hodg.e.man.. from O'Maalvany & Myers,E Councilman Snyder- I hate to inject a depressive note but Trhen we first embarked on Public Authority for the Civic Center Development we did it with'the information that our assessed valuation and sales tax weremonie s enough to pay the cost without an increase in the tax rate. Well, all indications are, from the state level and in business, that our assessed valuation may not be increasing that fast and our sales tax may not be increasing that fast and I am wondering what our p'arcentage of assessed valuation is this year and what our possible salee'tax is and if the staff still feels we can embark on this program with out increasing the tax rate? Mr, Aiassa- We have actually submitted a balanceibudget and it will be prepared and drafted for the City Council and in this budget is included the rental charge which is. predicated on- our estimate from the computations of Stone and Youngberg representatives, plus our own staff, and the figures from the County As's_essors office, lus our estima�es on sales tax receipts and we can and will operate w thin this year s tax rate and actually propose the same type of operations that we had in '66m'67, Councilman Snyder-. The next question and perhaps as a public official I need not think of this, but building is down, industry is not building, homes are not being built and the indications are the economy is going down and I am wondering if we couldn't get a lower bid if we waited a year? Mr. Aiassa-. I doubt it. In reviewing the present bid on the number of bids we had and the fact that we A we came in with 11.9% under the architect's estimate we feel have a very good bid, Mayor Kriegero, Mr, Zelles would you care to respond to that . question's Mr. Herman ZelleS I think as Mr. Aiassa pointed out the Financing Consultants construction bids were certainly excellent bids San Francisco and some 10 or 11% under the estimate. There was_ a pretty substantial range if you take the highest bidder versus the lowest one, And, I think ,you will also notice on July 1 there will be a number of changes within the construction 13 ADJ. C. Co 6=5-67 Page Fourteen PUBLIC AUTHORITY: _CIVIC CENTER DEVELOPMENT - Continued industry in -terms of automatic increases in rates of pay. Most of the construction costs have been increased at the rate of somewhere between 4 and 6% a year in the last ten years. There is no reason to think that it is going to go down. The only reason you got such a low bid is due to the slow down in home industry and there are a is number of contractors available for this type of construction. Councilman Snyder. That is my point. If we have a further slow down we will have more hungry contractors. Major Krieger-, The two pieces of action before the council tonight on the Public Authority is not the approval of the construction bids as reported in the staff report of June 2, this is strictly within the purview of the Joint -Authority itself. The action before us tonight is, one w ould be the ground lease and secondly, the building lease, as separate questions. We have a staff report on these matters, as well as a proposed resolution, as well as proposed ground and building leases. I would assume if the council didn't take affirmative action for some reason on these ground and building leases that the Public Authority would not then move ahead in this program. Mr. Zelles-, The.answer is es. Your execution of the ground and building lease is your part.of the joint authority and without the execution on the city°s part the authority has nothing to execute and therefore nothing to secure the bonds of the authority, so therefore the bonds would not be saleable inasmuch as there are no leases with the City to secure the bonds. The attempt has always been to keep the council in complete control by a number of steps, first all the constructions bids were taken, your execution of these leases is tantamount to authorizing -or instructing the Authority to adopt the resolution of issuance of the bonds, which we will discuss later on regarding the action that you will be taking on the 12th of June. One more authorizaticmon the part of the City Council will actually take place on the sale date of the bonds, wherein you approve the sale of the bonds by the Authority before the Authority can actually award the bonds. So the intent was to have the council always in complete control and to specifically answer, without the execution of these two documents and the execution of the approval of issuance by the Authority by the Council next Monday evening there will be no sale of bonds. Mayor Krieger-, Thank you -Mr. Zelleso The first item which is the Ground Lease should be discussed, We have a staff report. Does the Council have any questions? Councilman Nichols: I have no questions. Councilman Gillum: No questions., Councilman Gleckman: No questions, Councilman Snyder-.- My understanding ® if we approve these leases tonight this in effect gives the Joint Authority the right to go ahead on approving the bids? Mayor Krieger: I assume the procedure m and if this is not correct please correct us Mr, Hodgeman ® that the bids remain valid for 90 days and that the Joint Authority will not consider the actual award on the construction bid until the revenue bonds are bid and a decision is made -on that particular matter, which as Mr, Zelle% pointed out, is something the council reserves the right to approve :in the basic agreement creating the Joint Authority, am I correct sir? Mr. Hodgeman: Yes that is correct, - 14 - ADJ. C. C. 6-5-67 Page Fifteen PUBLIC AUTHORITY-, CIVIC CENTER DEVELOPMENT ® Continued Councilman Gleckman° Isn°t what we are talking about what. Mr. Zelles just said takes plane on the 12th of June_? Mr. Hodgeman: That is correct. We have split up these steps. We ask you to approve these leases tonight. • We want to hold off on the document until the 12th although it is actually ready tonight. We would ask you to approve that and then you have two more approvals when the bids are opened. You would approve the sale of the bonds and when the bonds are sold you would approve the award of the construction contract. Councilman Gleckman: What are we talking about in time, regarding the last two items? Mr. Zell es: The time schedule calls for the following: We will meet again at next Monday evening's meeting, at which time you will adopt the resolution approving the form of the resolution of the Authority calling for the sale of the bonds. The Authority will meet on the 14th of June their regular meeting -date, and at that time adopt the resolution of issuance that you approved on Monday, and will also adopt a notice on the bids providing for the sale of bonds. . • Mayor Krieger-, These are the reOue bonds? Mr. Zelliea: Yes these are the revenue bonds. The sale date of the bonds is scheduled for Monday, July 17, 1967, at 2 in the afternoon, at which time the secretary of the Authority will open the bond bids and we will be repared to calculate the bids.to be sure the are correct. CouncH will meet that evening and we will report io you the results of the.bond bids ° you. then, assuming you wish to proceed, will approve the issuance of the bonds by the Authority and the Authority will convene at 8:30 that evening or thereabouts and make the award of the bonds to the successful bidder and at that time award the construction contract, The construction contract has not been awarded and will not be awarded until such time as the bonds have been sold. This is to prevent or preclude the City or Authority to involve itself in a liability of payment on the construction contract when the financing has yet to be secured, Councilman Gillum: The County does not have�to approve? Mr. Zelles:, No, the Joint Powers Agreement provides the only approval required is the person responsible on their buildings, on the lease. They follow the same procedures Councilman Snyder: Again, as a public official I should be optimistic and not depressed, but I am concerned about the state of economy in California and I am not as enthusiastic about going ahead with this program as I was. I will vote for it if the majority of the council does, but I wouldn't otherwise, and I will say this, you all know I worked enthusiastically for it originally. Councilman Gillum: Dr. Snyder I think you will remember when we ® discussed this, the point was brought up, in fact this was one of the things that made me change my thinking from general obligation to joint powers was the fact the longer wait the cost of labor and material would eat up anything we would hope to save. Councilman Snyder-, Yes, but the apparent weakness in California economy was not as apparent then. Councilman Gillum: Well inflation is here and it is going up each year. ® 15 ADJ. C. C. 6-5-67 Page Sixteen PUBLIC AUTHORITY: CIVIC CENTER DEVELOPMENT m Continued Councilman Snyder: I am in no position knowledgeable or otherwise to really judge this. I am a little concerned about embarking on a project of this type when the State itself is deep in the hole. • Mr. Zelies: I think the reason, referring to the State Water Plan problems that they are having, very simply was that there wasn't an allowance in the State construction costs for escalation that put the State in the position it is right now. Councilman Snyder: No what 7I am talking about is the thing that is going to pay for this ® mainly sales tax. Mr. Zell 3: Well that is true, but the lease payments of the City for that matter will not be required until 2 years from July. That is when the first payment will be due. During the period of construction and for a period of one year thereafter the cost has all been funded. So if there is any satisfaction in knowing when the Community itself is going to be responsible on the leases . . . even though the City through the City Manager is making arrangements for that now. • Councilman Snyder: may have committed make sure. Mr. Zell ea: Councilman Snyder: I am only giving an opinion and I think it is something we should think about each step we go along and once we have taken this step we ourselves to something we cannot pay. I want to I think certainly the City has the capacity for repayment. I don't know but I would ask a question of Mr. Fast But not if our sales tax falls off. Mr. Zelless This is true, but as far as the bondholder is concerned there is certainly ample security as far as the City of West Covina within your general tax power there_ are all these things that secure the bonds. But I was just sort of wondering if we had these bids all over again would the same low bidder - would he give you the bid all over again? Mr. Fast: Well the whole picture of the construction industry has been one that has climbed ever since the depression of 1929. There has been a dip segmentally and the last three years residential has fallen off but commercial industry has held up. Insofar, as the bid spread, we had very close competition in the first five bidders. The. spread in general is very normal and is something I personally have witnessed and recognized as normal in bidding in the last ten years. I would be the last one to say that we will ever get another bid this low whether we wait one week or one year. History just doesn't say that. Mayor Krieger: This is just the unknown factor. I appeared before the Board of Supervisors on several occasions as a representative of this council ® on this subject matter and this question you raised was raised five or six months ago on the Board of Supervisors by one of the members of the Board concerned with this problem, and here he had the Chief Administrative 0 ficer of the County sitting right in front of him who is always attun-d to the financial questions the same as our City Manager is, and as well as the County Council, as well as their whole staff and their consensus feeling, as I remember it expressed, 16 ADJ. C.C. 6-5-67 Page Seventeen PUBLIC AUTHORITY: CIVIC CENTER DEVELOPMENT ® Continued was that this was a particularly good timeasfay' as public buildings were concerned, government projects and programs of this type. I don't think the economy bascially has changed in regard to that philosphy and I think the best evidence we have is the very return • we got on the bids. Councilman Snyder: I would like to correct a statement of fact regarding history, it depends on how far you go back. If you went back to 1930 you could have buildings built by WPA. Mr. Zelles: I think the Doctor°s point is well taken, you are concerned about cost and you have to be, there is no question about it, Councilman Snyder: I am concerned mainly about our levelling off of sales tax, which is what I am really concerned about. Mr. Zellless If you stay in the same level you are at now I think you will still be alright. • Councilman Gleckman: I have more faith in the future then Dr. Snyder does_ and as far as our sales tax is concerned I think once the ground breaking takes place, and the retail and commercial areas know of our progressing in this way with a new Civic Center and Police Facility that I think we will then be in even better position to invite bigger and better business into our community and add to our sales tax rather than going the other way. Councilman Snyder: I didn't say I haven't any faith in the future, I am talking about the reality and the immediate future, Mayor Krieger: Does that compplete the discussion on the council in Ms matter? Any further questions? RESOLUTION NO, 3588 The Deputy City Clerk presented: "A RESOLUTION OF THE CITY COUNCIL OF ADOPTED THE CITY OF WEST COVINA OF CALIFORNIA APPROVING THE WEST COVINA ADMINISTRATIVE AND POLICE BUILDING GROUND LEASE." Mayor Krieger: Hearing no objection, waive further reading of the body of the resolution. Motion by Councilman Gleckman, seconded by Councilman Gillum, that the council adopt said resolution. Motion carried on roll call vote as follows: AYES: Councilmen Gillum, Nichols, Gleckman, Snyder, Mayor Krieger NOES: None ABSENT: None Mayor Krieger.- With regard to the Building Lease, Any questions? Councilmen Gillum, Nichols, Snyder and Gleckman, answered "no questions." Mayor Krieger: I have a question Mr, Zelles, The base rent of $1989200 per annum is predicated on what type of expectancy? 17 ADJ. C. C. 6®5®67 Page Eighteen PUBLIC AUTHORITY-, CIVIC CENTER DEVELOPMENT m Continued Mr. Zelluso Based on an estimated rate of 4m3/4%. Mayor Krieger-, Without putting you on the record or on the spot m do you have any idea this evening • where we are in the market right now? Mr, Zelles-, With today's events a lot of things have happened. To give you some sort of an indication there was a bond sale this morning by the San Bernardino City Schools, a 20 year bond issue double AA rated and I believe it was five million dollars-, and the net is 3.91. Now remember we are talking about a much shorter bond than this and one with a considerably higher bond rating. I would hopefully say that if these bonds were selling today we would be in that range of 4-1/2 - 4-3/4. We really don't know. It is like baking a cake, the time to know is when you take it out of the oven and test it. We believe we are considerably high at the time we made our projections. The market is very fluid and changing all the time. This amount of $198,200 is not a fixed amount. It is an adjustable amount and will be reduced or increased, hopefully not, based on the actual bond bids received by the Authority. There is an exhibit that appears m Item 12 in the book, and is reference to • the fact that this item will be adjusted on the basis of the actual bond bids, Mayor Krieger-, There is nothing in the report or material whether this was predicated on a conservatively high? Mr, Zelles-, We would hope it is conservatively high, Councilman Gillum-, When they open up the bond bids and for some reason they are over 5% and we reject them then what is the. next step? Mr. Zelles-, You have a certain period of time to reoffer the bonds for _sale again ® the Authority does. The only thing that mitigates in this respect Is that the construction bid is only good for 90 days from the 24th of May, which brings you to August 23 or 24th. If you could not secure a better bid for the bonds by the 24th of August then the contractor cannot be held to that bid and you would have to resubmit your construction bids again and go through the whole procedure all over again. Mayor Krieger-, Is there anything economically inconsistent of a low construction bid and a high bond interest rate? What I am trying to determine is whether there is any relationship between the market of economics between what we have experienced on the construction bid and.what we might anticipate on the bond issue? Mr. Zelles-, I don't believe there is. We are in a period of reasonably high level of rates. This is what we use to measure, like the Dow -Jones at the end of last week was 3.96. The highest it has ever been in 33 years was what it reached in September of last year 4.24. The curve has been going up, It came down to 3,50 something in February of this year and then started to climb up again and is up to 3.96. I don't know whether this parallels the construction curve or not. I don't think there is a parallel. The economy jumps around so much and the bond market seems to move with it. We have seen greater swings in the bond market percentagewise than we have in past years. The range of 1/2% in less than 3 months is really pretty large when you normally expect to see these things change only ,051* step from one week to the next, • • a ADJ. C.C. 6®5-67 Page Nineteen PUBLIC AUTHORITY: CIVIC CENTER DEVELOPMENT m Continued Councilman Snyder: Mr. Zelles: bids coming in 30 the high outside see his bids come Mayor Krieger: There is a misconception that we got a lower construction bid, we are really within 10% of the architect's estimate and that is considered normal. Well on one thing you are talking percentage and absolute numbers on the other. Actually 10% o., we have seen some construction to 40% above the estimates. I think 10% would be I don't think any architect would be to happy to in lower than that. by our City Attorney as Mr. Hodgeman: Any further questions or discussion on this Administrative and Police Building lease? Mr. Hodgeman, I understand this was reviewed to the form of the lease? Yes that is correct. RESOLUTION N0,3589 The Deputy City Clerk presented: "A RESOLUTION OF THE CITY COUNCIL OF ADOPTED THE CITY OF WEST COVINA, CALIFORNIA, APPROVING THE WEST COVINA ADMINISTRATIVE AND POLICE BUILDING LEASE." Mayor Krieger: Hearing no objection, waive further reading of the body of the resolution. Motion by Councilman Gillum, seconded by Councilman Gleckman, that the council adopt said resolution. Motion carried on roll call vote as follows: AYES: Councilmen Gillum, Nichols, Gleckman, Snyder, Mayor Krieger NOES: None ABSENT: None Mr. Zel].es;: This is really for information purposes only, no action needed. Just a little history. There is a third party involved called a Trustee. The purpose of the trustee is to hold the funds during construction and also receive the rent payments by the City and then make disbursements to the bondholders m principle interest on the bonds and to invest the various funds involved that the Authority has, This places all the money in a Trusteeship so there is no one individual that holds the funds,, Payment to the contractor for_his construction progres payments are paid by the trustee only on the certificate of the architect and your engineer as to the fact the work has been petformedo' Originally the County thought they would be involved in a Trusteeship. On their part they elected to act on a trusteeship in their own capacity. We didn't particularly feel that we would prefer to have it this way, and the end result was that the Trustee proposals would have covered a greater number of banks involved had the County also wished to be involved because we thought we might be able to effect certain savings by having both parties involved than to act on their own Trustee. We in turn then made a request of three banks, U.C,B,, Security First National Bank, and the Bank of America, setting forth certain requirements and asking for certain costs on their part to act in this capacity. You gentlo-men should have a copy of our letter which set forth the various requirements of the Trustee, We then in turn calculated the various costs involved to act as Trustee and the Bank of America ® their costs were the lowest and on that basis we �F� ADJ. Co Co 6-5-67 Page Twenty PUBLIC AUTHORITY-0 CIVIC CENTER DEVELOPMENT ® Continued assume the Authority will award the trusteeship to the Bank of America. This is important because the trustee is actually named in the documents and therefore the trustee should be selected before the resolutbn of issuance is actually adopted by the Authority, which they will do on the 14th of this month. Again no action on your part this is so you will just be totally informed. Mayor Krieger: The action of the council on the 12th will. specifically set forth the Bank of America.? Mr. Zelleso Yes, The resolution of issuance, I believe it just arrived and one of the reasons we didn't want you to adopt it this evening, so that you would have an opportunity to look it over. Perhaps maybe I can just briefly summarize what this contains. Basically, what it is is a definition of the bonds of the Authority and also it indicates what the disposition of the bond proceeds will be, What amount goes into the various funds. The creation of the construction fund, the reserve fund, the interest during construction, makes provision for the issuance of additional bonds, and sets forth the various requirements that have to be met before additional bonds can be issued. It also makes provision for • the redemption of the bonds and this is an important thing. As I indicated before we are in a period of high interest rates and there is really only one thing you can do in this sort of a situation and that is to make provision in your bonds that should -the interest rates seek a much lower level you have the ability to refund these. This we have done by putting in a reasonably liberal call provision that says in effect that after these bonds are in effect for a period of 1hh2 years they can be redeemed, whatever is outstanding at that time, i ourlra eeisa�onJdaera�i ytlowernand ca�culationstare a�`est a�mi ow9 would be more economical to refund and that you have the ability to do this, you are not fixed contracturally for the next 30 years at the rates ..that you have bid at the 17th of July. This is the only thing you can do to be sure you have flexibility and the thing we wanted to be sure was that you would have this flexibility. We believe the call provision is liberal enough so that the bonds will not be penal- ized by making it too severe in terms of time. Generally 10 to 15 years. _You would not have them callable any sooner than that. To do so you would impose a pretty heavy penalty upon the issue of the bond, to call in 5 years or something like that. Again we say these bonds are actually weighed in the long end that the block of the bonds really come due considerably after 1979 and that is when the first call provision can be made. Mayor Krieger: Any questions on Mr. Zelles's report? Mr. .Zellus, why would not a sophisticatEd bidder take this under consideration at the bidding? Mr. Zell.es: He does. Mayor Krieger: Then it would necessarily at least, have some marginal effect on ��e bid? Mr, Zelles: I am not sure I understand your question, The ® call provision is important, Mayor Krieger: The bidder is certainly aware of that then? Mr. Zelles: Oh yes, The call provision is mentioned a half a dozen times, Mayor Krieger: And recognizing that provision exists in these bonds the bidder would take that provision into consideration as far as his bid on these bonds is concerned? ® 20 ADJ. C.C. 6-5-67 Page Twenty-one • PUBLIC AUTHORITY.- CIVIC CENTER DEVELOPMENT m Continued Mr. Zelles.- Yes, if the call provision is too short. this will be reflected in the bids Mayor Krieger-. If the bulk of the money is not inhe-rent in the bond issue until 1979,.why is not the bidder influenced by that factor? Mr. Zelles-. To answer your question you have to understand who buys these kinds of bonds. The investor generally speaking calls on a number of categories. By and large you have the short term investor from l to 10 or 15 years. These are prinaipzklLly your banks. They, of course, want to be sure that their mon�q will be at work for this period of time. Your other investor is your long term investor, principally your investment funds, insurance companies, trusts of one type or another and their investment portfolios are -very long, generally 25 to 30 years and to that extent they work on an average life basis so that if their average life can be equal to or greater than half of the material of the bonds this satisfies their requirements. Inasmuch, as things are being turned over all the time, half would be approximately 15 years and we felt with the market being as high as it is that we would like to have the City in the position -of having a little shorte-r period of call, so we split the difference. I might add that when a person gets a bond recalled he is paid a premium for the call of the bond. It is on a formula basis. 1/4 of 1% each year from the year of call to -the time the bond was actually due. If -the bond was called 12 years prior to the maturity date, he would receive he face amount of the bonds, 1us a remium of 3%. In other words for ea.�h year divided into 1 . As �ong as you provide for reasonable payment on the call this will not affect the sale, but if you make the call too shot this would hurt ou I think asgoaipra9tichaalv�maatte hin you have o nave some reassuran e tha you are ng g to call the bonds with in 5 years from now. Some windfall. Normally, speaking this is going to be paid for out of your general revenues and I don't think you are anticipating this sort of thing taking place. Councilman Gillum-. Is this normally done with the majority of bond sales? Mr. Zelll.es Everyone we,deal with. With certain exceptions. -I t.hii;_nk certain school bonds as a rule are not calked, because the presumption is you have to have something to call it with. There are numerous things available to the City in the way of funds* who knows what may happen in time; Councilman Gillum-. The time determined, you determined yourself? Mr. Zellee-. The period of when it will be callable, yes. This was one of the reasons we wanted to delay this document as long as we could. We wanted to be sure the way the market was going. Councilman Gillum. What determines in your mind the present time to have this set for recall? What determined 12 years, what did you use for a guide? Mr. Zelles-.. Our guide was that you certainly can't go any less than 10 years and 15 was certainly a possibility, but the way the current bonds are being sold we felt making it shorter than the 15 years would not materially affect the sale of the bonds in term of having a.higher interest rate and would provide the City with a little more flexibility. Councilman Gillum.- In other words basically then it was almost an educated guess on past -experience in the bond market? Mr. Zellee.- We were in consultation with our own bond trading department, they deal with these thingsoevery day of the week. ADJ. C.C. 6-5-67 Page Twenty -.two PUBLIC AUTHORITY-, CIVIC CENTER DEVELOPMENT ® Continued Mayor Krieger-, I might commend when we were interviewing the bond consultants, 3 or 4 years ago, one of the material elements that attracted us to Stone and Youngberg was the fact that they were the only ones: in my remembrance that mentioned the feature of a call in a municipal bond, As being an attractable feature. This was certainly one of the features of the discussion that they were considering this so far ahead. Mr. Zelles-, I think a call provision is something that once it becomes history you really can't do anything about it. There are agencies who don't have call provisions and it is just physically impossible to bring the bonds in other than trying to buy on the market at face value and generally speaking these are very high interest bonds with high yields and whoever owns them is not willing to give them up. To go on, the rest of the document, which sets forth the bond itself, what it will look like, etc. Then a use of reference, which tells the trustee what he has to do with the money that comes in each year, the various funds he must allocate this money to, and then finally a covenant of the Authority, wherein they make a lot of promises to pay the princ:L.ple and interest on time, maintain insurance, maintain proper records, give an accounting of the funds received each year, also • look in on the city budget each year to be sure you have allocated monies for the payment of your rent payments each year, and also this sets forth limitations on the debt. The next items are relative to what the capita, surplus must be, what happens if the tt°ustee wishes to be released, how you appoint a successor trustee, etc, Mr, Hodgeman, Mr. Powell and myself, we labored over this document for quite sometime. I won't say they are completely original, but this is a contract actually between the Authority and the bondholder and this iz what the bondholder relies on for the Authority performance and the Authority relies on this lease with the City to pay its rent to secure its document here. There is a fee and that is stated in here and this will go out to you tomorrow. These fees are calculated on the basis of the entire bond issue, but to give you some idea I will quickly go through this. (Mr. Zellus then listed some of the fees, again stating the council would have all this tomorrow and they could then -study it.) Councilman Snyderf The funds from the initial sale of the bonds, can they be put on a time deposit? Mr. Zelles-, They can be deposited in time deposits, yes. The investment is the responsibility of the trustee, however, I am sure the trustee has no objection i-n working with your own Director of Finance, in terms of where you would like to see them deposited. There are certain limitations as to where they can go. You can't ut them in the Home Savings & Loan or something like that, He is obligated to provide you with the highest return that he can. Councilman Snyder: There is a term in that aggreement which obligates him to thiP? (Answer: Yes) Mr, Zelleso There is a summary sheet that goes with the . three proposals and youcan see why.we talked about these various fees, the cottrolling fee is actually the annual fee and the lower one was the Bank of America ust slightly under $15,000; the second was United California Bank at 19,000; and the Security First National at $21,400. And if you average this over a 30 year period it doesn't amount to a great deal of money. I might add that the fees of the -trustee will generally be recovered from the interest earnings held in deposit by the Authority so they are not looking for additional rent from the City. There will be substantial sums of money, mainly the reserve fund, which will be 22 ADJ. Coco 6-5-67 Page Twenty- three PUBLIC AUTHORITY: CIVIC CENTER DEVELOPMENT ® Continued equal to a half years rent and also the fact that you make your rent payment annually in advance of the time which the Authority must make the principle interest payment on the bonds, so there will be sufficient funds to cover the cost of the trustee and in fact with the interest earnings and the reserve fund held on deposit the probabilities are you will be able to shorten the life of this contract by probably a year or so Mayor Krieger: Is there further questions of Mr. Zellus, or Mr. Hodgeman on the oral presentation? Is there anything you want to add Mr, Hodgeman? Mr. Iodgeman: No there isn't. The resolution was not handed out tonight, although it is ready and Mr. Williams will be here next weeks I will not, but Mr. Williams can answer any questions you may have. Mayor Krieger: We will then defer this matter for the action this council has to take until next Monday night. Mr,, Zel ess I might add Mr. Mayors neither Mr. Powell nor I will be here at the meeting of the 12th. You can have our assurances that we are completely satisfied with the text of the resolition of issuance which you will be adopting, as to form. We will be in attendance on the 14th when all the actions that the Authority must take will be taken. Namely, the execution of their half of your leases and this document here. Mayor Krieger: Thank you Mr. Zelles, Mr, Hodgeman and Mr, Powell, We appreciate your being here this evening. DEL NORTE.PARK LAND ACQUISITION a) Easement with William R. Hinrichs Motion by Councilman. Gl.Pe�kman, sPrnn(iPd by Councilman Gillum, and carried that this matter of the easement with Mr. Hinrichs be held over to the councl.L meeting of June 12, 19670 b) Gonne Property Mr. Aiassa: The City Attorney was able to complete this lease Mr. Mayor, and I made a rough draft of the provisions of the lease. It covers pretty well the elements outlined to the council and the reasonwe would like to make this a kind of urgency matter is that we have a problem in that Mr. Gonnees health is failing. The lease is a combination. It also has a provision where we are providing a lease from June to January paying a fee of seven hundred and some odd dollars and our first payment to Mr. Gonne will be made in July of 1967. The second payment will be made in January. Motion by Councilman Snyder, seconded by Councilman Gillum, and carried, that the council authorize the Mayor and City Clerk to execute the said lease with an opti6n to purchase from Edward S. Gonne, a widower. APPROVAL OF_5 YEAR _PUBLIC WORKS PROGRAM Mr, Aiassa: We have a one ,year report for the council and we have completed the 1966-'67 physical portion. Mr. Fast will pass it out to you. We also have - 23 ADJ. Coco 6-5-67 Page Twenty-four • C1 0 APPROVAL OF 5 YEAR PUBLIC WORKS PROGRAM m Continued budgeted the 167®868 portion of the 5 year plan. This will probably be discussed during the budget meetings which have been scheduled. If any of the councilmen have questions on the Q66m°67 portion they are attached to this and you might want to bring it with you when we have our budget session on this review. I would like to advise that we have been rather successful in completing most of the projects as outlined in the °66®°67 program and also fortunate enough to be able to budget most of the projects in °67®°680 Mayor Krieger-. I assume we will get into these specifics at the budget sessions, Councilman Gillum: A question of the staff, On Azusa from the wash to the Freeway, they are putting in a storm drain, are they also going to lower the crown? (Mr. Fast advised they were that it was authorized by the council in the contract,) RESOLUTION NO. 3590 The Deputy City Clerk presented - "A RESOLUTION OF THE CITY COUNCIL OF ADOPTED THE CITY OF WEST COVINA FINDING THAT IN THE PUBLIC INTEREST, CONVENIENCE AND NECESSITY REQUIRE THE ACQUISITION OF CERTAIN PROPERTY FOR STREET PURPOSES FOR LARK ELLEN AVENUE," Mayor Krieger: Hearing no objection, waive further reading of the body of the resolution. Motion by Councilman Gleckman, seconded by Councilman Gillum, that -the council adopt said resolution. Motion carried on roll call vote as follows: AYES- Councilmen gOES: Councilman ABSENT: None ANNEXATION NO. 195 Gillum, Gleckman, Snyder, Mayor Krieger Nichols Motion by Councilman Gleckman, seconded by carried, that the council request LAFC to months time to Annexation 195. COMMISSION APPOINTMENTS Councilman Gillum, and grant the extension of six Motion by Councilman Gleckman, seconded by Councilman Gillum, and carried, that the council adjourn to an executive session dealing with Commission appointments at 9:55 p.m. (Meeting reconvened in Council Chambers) COUNCIL COMMITTEE REPORTS Councilman Gillum: It seems we have a group concerned about the trees and they have written letters to Mrs, Johnson, Secretary Udall and have received letters of support from them. I would like to see this council send letters to these people stating the reasons we have come to these conclusions or the reasons these statements have been made. Councilman Snyder- Do we know? 24 ADJ C.C. 6-5-67 Page Twenty-five COUNCIL COMMITTEE REPORTS m Continued Councilman Gillumo Well these were the recommendations of the Recreation & Park and the Blue Ribbon Committee and I think it has put the City of West Covina in a bad light with the Secretary and Mrs. Johnson in her push to beautify the countryside of the United States. • Councilman Snyder: But as a matter of fact, probably some under secretary away down the line probably read the letter. Councilman Gillums Well this may be so, but it was put in the paper and stated publicly a.letter from Secretary Udall, and parts of it were -in the Los Angeles Times and I just feel that the City of West Covina should make the facts known to these two officials and also to the Governor of the State of California, because he had received letters from this group. I would like to make it in the form of a motion with the Mayor signing the letters and send a letter to Secretary Udall, Mrs. Johnson, and Governor Reagan, outlining the reasons this problem exists and the reasons we have before us for considering such action. Mayor Krieger: Is there a second to the motion? Motion dies for lack of a second. Councilman Gillum: Well then I am going to inform the council that I am going to do it on my own as a city councilman of the City of West Covina. Mayor Krieger: I don't know whether we can stop you, but I will indicate my own personal feelings. This was a unilateral act by certain people in the City, they can write letters to whomever they want and I don't think we can defend ourselves before Secretary Udall or Mrs, Johnson. We are responsible only to the people who elect us. None of those people are even voters in the City of West Covina and in their official capacity they don't have any jurisdiction over the City of West Covina, Councilman Gillum: I am very well aware of that Mr. Mayor, but I am also aware that these letters have appeared the Secretary and others have been made public in the newspapers and I think it puts us in a bad light if it appears that the City of West Covina has no thought for beautification, no thought for trees and llif we are going to consider asking the Federal d c t o hfnkerii JR ds for eautifiiation,it would b� a little a 9 p ple were o see if we ecide o route, that we are saying ®well we are going to take so much of this money and cut down these trees o... Councilman Snyder: Are you mad at the Federal Government or the person that answered the letters? Why don9t you writs letters to the person who wrote the letters? If you read the letters carefully though they answered prudently and it is apparent they answered just to agree with them, Mayor Krieger: The trouble is Councilman Gillum, I think it just gives too much credence to the whole thing and all it will do is we will get publicity back again. Councilman Gillum: Let me say ® this has been the expression of many people who served on the committee and served as commissioners on the board, that I bring this up before the council. They are concerned about it, Mayor Krieger: As private citizens thh have luxur that you don t have as a cit councilman, hey have the luxury of turning around and writing to Governor Reagan or Mrs-. Jahnsa-n_or the Secretary, if they want. 25 ADJ. C.C. 6-5-67 Page Twenty -Six • C� COUNCIL COMMITTEE'REPORTS ® Continued The trouble is this office carries a certain amount of responsibility. I don't know who r-ead the letters in each one of the offices, but I am quite sure it was not the person to whom it was addressed, but if they get a letter from you I wouldn't be the least bit surprised that it would be read by the Govenor, or Mrs. Johnson, or.Secretary Udall, and they will say what is this all about, why is a councilman from the City of West Covina writing me, telling me about why he did something, Councilman Gillum: I still feel that we should make our point clear. The letters did come from their offices. I am sure what you are saying if they didn't see it, maybe it is time they see what is going on down the line, because this letter carries some weight with citizens in the community who were not aware of what was going on or why these decisions were made. Councilman Snyder: If you read the letter,,,, Councilman Gillum.- I did read the letter Dr. Snyder, Councilman Snyder: Well if you interpret the letter - they only answered on unilateral knowledge. They didn't attempt to get both sides of the question. Obviously, it was just a political answer. I think by answering them back we are giving credence as the Mayor said, and making it even more political. Councilman Gillum: If it is the majority feeling of the council that I should not participate in this then I will not, but I think the council is wrong, -- in not making. its action known, Mayor Krieger: I think the failure of the motion to get a second speaks as far as the council body is concerned. I know that each one of us personally reacted and sometimes it requires restraint to hold yourself back but sometimes it is surprising what the title of the office means when you are communicating with some.of these people. I ob4ect because it injects theseeople in a situation that they didn t belong in - they just didn't have any choice, they didn't come in because they wanted too, they came in because somebody brought them in. If we allow them to stay in we are just abetting the situation that never should have started. I think some of these people are getting a vicarious kick - all of a sudden they find their names in the paper, they have never been in the papers before. Councilman Gillum: I think, honestly gentlemen, that we do not give enough credit to the person behind the movement to save the trees. Air Show yesterday and Mikeallso ant t r ort the I w t to the y y Mora es sa?d say "h ", to was really a fine show. Also, Mr, Aiassa, is it possiblE to make copies of this report on the business license information available to the Chamber of Commerce so that it may be forwarded to them as soon as possible - about 20 copies, so their committee can go over it? (Agreed) Sign Ordinance? Mr, Menard: the report of instructed me Public Hearing Another question - what happened to the Three informational discussions have come before the Planning Commission, At the last Planning Commission meeting they accepted the Planning staff, at least formally accepted it and to codify the ordinance and it will be presented for a at the meeting of the 21st of June, -26m ADJ. C.C.. 6-5-67 Page Twenty- Seven • 0 COUNCIL COMMITTEE REPORTS - Continued Mr. Aiassa: Mr. Mayor, I would like to make a suggestion. With regard to the Business License report by the staff, I would prefer to ha Ve the Committee duly appointed by the council review this material. Mayor Krieger: The council committee on the Business License is Dr. Snyder and Mr. Gillum. The Council Committee on the budget i-s.Mr. Gillum and Mr. Gleckman. Councilman Snyder: How many in number of business licenses are there in the City? Lela Preston: About 1400 - 1500 roughly. Deputy City Clerk Councilman Snyder: What is the membership of the Chamber? Phil Wax: About 335. Motion by Councilman Gillum, seconded by Councilman Gleckman, and carried, that the council adjourn at 100035 p.m., to June 8th at 7e 30 p.m. ATTEST: Deputy City Clerk APPROVED MAYOR - 17