07-02-2018 - Special Meeting - MinutesCITY OF WEST COVINA
CITY COUNCIL/SUCCESSOR AGENCY/
PUBLIC FINANCE AUTHORITY
MONDAY JULY 02, 2018, 6:30 PM
SPECIAL MEETING —FISCAL YEAR 2018-2019 3r d PRELIIVIINARY
BUDGET WORKSHOP
CITY COUNCIL CHAMBERS
1444 W. GARVEY AVENUE SOUTH
WEST COVINA, CALIFORNIA 91790
MINUTE S
CALL TO ORDER — Mayor Lloyd Johnson called the meeting to order at 6:35 p.m.
PLEDGE OF ALLEGIANCE — Led by Mayor Lloyd Johnson
ROLL CALL
Present: Councilman Mike Spence, Councilmember James Tom., Councilmember Corey
Warshaw, Mayor Pro Tern Tony Wu, Mayor Lloyd Johnson
Staff Present: City Manager Chris Freeland, Assistant City Manager/Community Services
Director Nikole Bresciani, Deputy City Manager Laura Biery, City Attorney Kimberly Hall
Barlow, Assistant City Clerk Rosalia Butler, Interim Finance Director Judy Lancaster, Police
Chief Marc Taylor, Public Works Superintendent Micah Martin, Public Works Management
Analyst Michelle Mansour, Planning Director Jeff Anderson, Police Administrative Services
Manager Alex Houston, Assistant City Engineer Monica Heredia, Human Resources Director
Edward Macias, Police Captain Richard Bell, Police Captain Doug Murray, Fire Management
Analyst Russell Narahara
Monday July 02, 2018
PUBLIC COMMENTS/QUESTIONS
Ray Edmondson inquired about the City's contingency plan should the City have to declare
bankruptcy.
John Shewmaker expressed concerns regarding City expenditures.
Jim Grivich asked Council to amend the budget policy and added that all expenditures should be
limited to the amount budgeted. Mr. Grivich also suggested for City staff to monitor all
expenditures in order to ensure all expenses were paid in a timely manner.
Bill Robinson suggested for Council to implement a hotline where residents and City staff alike,
could voice their concerns anonymously regarding the budget, and provide solutions to remedy
the financial decline of the City with no possibility of retaliation. He also advised Council to
implement the 10% proposed cuts from the Special Budget Workshop on June 11, 2018.
Chris Miller discussed the data detailing City staff salaries from the website Transparent
California and expressed concerns regarding the redaction of City data.
J.D. expressed concerns regarding the difference of Public Hearings and Budget Workshops and
stated that staff presentations and reports should be given before public comments so residents
can respond.
City Manager Freeland gave responses to speaker inquiries and asked Council to eliminate the
Consent Calendar from the Agenda in order to discuss each item separately. He also informed
Council that the Closed and Open Session of tonight's meeting will happen concurrently based on
the nature of Council discussion.
CONSENT CALENDAR
1) Budget Policy
It is recommended that the City Council approve the Budget Policy.
City Manager Freeland gave a brief report regarding Item No. 1 and informed Council that
these policies can be amended per Council direction.
Councilmember Warshaw requested for the following changes to be implemented in the
language of the proposed policy:
• Page 3, line 8 - correct "does adopt broad goals" to "adopt broad goals"
• Page 5, line 18 - correct "shall" to "will"
• Page 5, line 80 - correct "should" to "will"
• Page 6, line 129 - correct "The City Should" to "The City identifies broad goals"
• Page 6, line 144 - correct "shall" to "will"
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Monday July 02, 2018
* Page 7, line 162- correct "identify" to "identifies the purpose"
• Page 9, line 249-correct "should" to "must recognize"
• Page 11, line 313- correct "to" to "will"
Councilman Wu asked for clarification regarding the difference in verbiage between the
words "will" and "should."
City Attorney Hall Barlow clarified that based on statutory law, "should" is interpreted
for directory purposes whereas "will" is considered mandatory.
Councilman Spence requested for the language of the proposed policy to be changed
from "stakeholders" to "the citizens of West Covina" to reflect that City Hall is serving
the City of West Covina and its residents.
Councilmember Toma agreed that the residents are a top priority, but if that language is
amended to only include the citizens of West Covina, then it excludes West Covina
business owners who do not reside within the City limits as well as those property
owners with a vested interest in the City.
City Manager Freeland suggested for Council to amend the aforementioned policy to
change the language to define stakeholder as "anyone affected by or has a stake in the
City of West Covina, with priority to the residents and businesses of West Covina."
Councilman Spence asked City Manager Freeland for clarification regarding budgetary
compliance and the procedures the City Manager must adhere to.
City Manager Freeland clarified the procedures he must follow in order to remain
compliant with the proposed budget policy.
Councilman Spence expressed concerns regarding City expenditures and stated that
fiscal responsibility should be a top priority over fiscal goals.
Councilmember Warshaw disagreed with Councilman Spence's sentiments, and stated
that there will be instances where the budget will not always be balanced, and reserves
must be utilized in order to balance it.
A motion was made by Mayor Pro Tern Wu and seconded by Councilman Spence to
adopt the recommended budget policy with the proposed amendment limiting all City
expenditures to the amount budgeted. Motion was carried by a vote of 4-1 with
Councilmember Warshaw in opposition.
AYES: Spence, Toma, Wu, Johnson
NOES: Warshaw
ABSENT: None
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Monday July 02, 2018
Councilmember Toma asked for clarification regarding stabilization funds and inquired
about the policy on debt issuance and management.
Interim Finance Director Lancaster indicated that stabilization funds were synonymous to
that of fund balance reserves. She clarified that the debt management policy was effective
on July 1, 2018 as a response to the audit items requested from the State Controller's
Office.
City Manager shared that the aforementioned policy can be made available on the website
at the request of the Council.
Mayor Pro Tern Wu asked where the template for the budget policy originated from and if
nearby cities utilized an identical template.
City Manager Freeland explained that the proposed policy is used by the Government
Finance Officers Association (GFOA), and the same template is utilized by many cities
throughout the nation, who alter the policy to better accommodate the needs of their City.
Mayor Pro Tern Wu asked if the budget policy could be amended after it has been adopted
should the Council wish to make any additional changes.
Councilman Spence expressed concerns regarding the budget policy and requested for a
more extensive explanation concerning each proposed procedure to ensure they are
compliant with the California State Controller's Office (SCO).
City Manager Freeland stated that he would review each section of the aforementioned
policy to determine which individual goals and processes the Council wished to amend or
remove in order to be compliant with the SCO.
City Manager Freeland began to review ea& of the proposed goals from the proposed
Budget Policy with the City Council to ensure City compliance.
Mayor Johnson stated that the policy reflected what the City plans on doing in the future,
based on Council direction.
Councilmember Warshaw disagreed with Mayor Johnson and explained that the budget
policy and the budget should be adopted concurrently.
Couneilmember Toma stated that the adoption of the budget policy should be postponed
and completed after the City's budget has been approved in order to amend the
aforementioned policy to Council's specifications.
City Manager Freeland asked Council if they would prefer a sub-committee to review the
proposed budget policy with the amendments proposed by Councilmember Warshaw and
bring the item back for further Council discussion at a future meeting.
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Monday July 02, 2018
A motion was made by Councilmember Warshaw and seconded Mayor Johnson to approve
Councilmember Warshaw's verbiage changes to the proposed budget policy. Motion was
carried by a vote of 5-0.
AYES: Spence, Toma, Warshaw, Wu, Johnson
NOES: None
ABSENT: None
Mayor Johnson stated that the final adoption of the budget policy would be postponed to a
future meeting so that City staff could complete additional research.
City Manager Freeland asked Council to hold Item No. 2 until after Item No. 3 was discussed.
DEPARTMENTAL MATTERS
3) Fiscal Year 2018-19 Third Preliminary Budget Workshop
It is recommended that the City Council provide Staff direction on the various City
priorities related to the Fiscal Year 2018-19 Operating and Capital Improvement Program
Budget.
City Manager Freeland gave a brief summary regarding the City's budget plan. Mr.
Freeland also informed Council that revisions had been completed by staff regarding
staffing changes, as well as additional recommendations concerning the City's budget. He
also stated that per Council's request, staff would review all current and proposed Capital
Improvement Program (CIP) projects and if at any time during the presentation the Council
wished to discuss matters privately, they could adjourn into Closed Session.
Interim Finance Director Lancaster explained that the previous proposed cuts approved by
Council at the budget workshop on June 11, 2018 would be implemented into the final
budget plan. She also discussed an updated vacancy list and gave a PowerPoint
presentation detailing all department cuts and elaborated on all necessary revenue and
expenditure adjustments_
City Manager Freeland stated that the Police Department's proposed cuts were not at the
10% level but at a 7% cut and if the Council proposed to make any additional cuts, they
could be discussed in Closed Session.
RECESS — City Council recessed to Closed Session at 7:59 p.m. and reconvened to the
regular meeting at 8:49 p.m. with all Councilmembers present.
Police Chief Taylor informed Council of the Department's proposed cuts and the impact
they would have on the Police Department.
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Monday July 02, 2018
Councilmember Warshaw inquired about the change of patrol division deployment model
and suggested that this proposed cut could help with the increased amount of overtime
within the department.
City Attorney Hall Barlow indicated that per Council direction in Closed Session, Council
had agreed to all the proposed cuts for the Police Department except for the elimination of
the AB 109 task force. She also clarified and stated that no formal vote had been made and
the decision was not unanimous among Councilmembers.
Councilman Spence asked for clarification regarding the Business Inspection Fee and the
Emergency Incident Billing Fee.
City Manager Freeland clarified the definition and purpose of the aforementioned fees. He
also stated that there were some restrictions to these fees and would be brought to Council
at a later date for further discussion.
Interim Finance Director Lancaster discussed the proposed cuts for the Fire Department.
Fire Management Analyst Narahara clarified that the Business Inspection Fee would
include the inspection of all types of businesses and informed Council about the two
classifications for business type.
Mayor Pro Tern Wu inquired about the total amount of the inspection fee.
Fire Management Analyst Narahara stated that the business inspection fee would cost
around $100 per business.
City Manager Freeland informed Council of the proposed ongoing firefighter model and
the staffing changes for the West Covina Fire Department. Mr. Freeland also explained that
there were two proposals from the Fire Association, and one must be implemented into the
final budget. In addition, he also stated that the Community Services Department is seeking
Council direction regarding the fate of the Discover West Covina newsletter.
Mayor Johnson and Councilmember Warshaw requested for staff to compile more
information regarding the business inspection fee.
City Attorney Hall Barlow indicated that more information regarding the aforementioned
fee would be compiled by City staff for Council consideration at a later date.
Mayor Pro Tern Wu expressed his disapproval regarding the proposed fees.
City Attorney Hall Barlow stated that the Council did not need to vote whether or not they
approved the proposed fees but needed to provide direction to determine how staff would
proceed regarding the adoption of the City's budget.
Mayor Johnson stated that Council had reached a consensus to approve the proposed fees,
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Monday July 02, 2018
with the stipulation that items would be brought back to Council at a future meeting for
further discussion.
City Manager Freeland clarified that the Business Inspection Fee and the Emergency
Incident Billing Fee were approved by Council provided that they were both brought back
at a future meeting for further discussion.
Councilmember Warshaw asked if any additional sources could be utilized in order to
better advertise the Discover West Covina newsletter to residents.
Assistant City Manager/Community Services Director Bresciani indicated that the
Community Services Department had already reached out to a vendor for publication needs
but was still awaiting a response.
Mayor Johnson and Councilmember Warshaw agreed that more information was needed to
be obtained regarding the publication of the newsletter before Council can make an
informed decision.
City Manager Freeland informed the Council of the Business License Ordinance
amendment recommendation from staff which had already been agendized, but staff was
requesting Council reconsideration. He stated that by reconsidering this item and approving
it, the City would have $1.7 billion in revenue to offset the cuts needed to balance the
budget. In addition, if Council wished to approve this item and place it on the upcoming
ballot, it would need to be adopted by the August 10, 2018 deadline. He also indicated if
the Council chose not to adopt the aforementioned Ordinance, the City would have to be
make additional cuts totaling the $1.7 billion loss.
Mayor Pro Tern Wu expressed concerns regarding the impact of the increase in business
licensing fees on small businesses and on the community.
Councilmember Warshaw shared his concerns regarding said fees and asked what how
much City businesses would be charged and if the amount changed based on lot size.
Mayor Pro Tern Wu requested for the Business License Ordinance amendment to be
agendized and brought back to a future Council meeting for further discussion.
Councilman Spence expressed concerns regarding the proposed measure and asked how
said measure could be included in the final City budget if it had not been adopted yet.
A motion was made by Councilmember Warshaw and seconded by Mayor Pro Tern Wu to
hold over discussions on whether or not to place the Business License Tax measure on the
upcoming ballot at a future Special Meeting. Motion was carried by a vote of 4-1 with
Councilman Spence in opposition.
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Monday July 02, 2018
AYES: Toma, Warshaw, Wu, Johnson
NOES: Spence
ABSENT: None
Mayor Pro Tern Wu asked City Manager Freeland if the super majority vote was necessary
to approve the placement of the aforementioned measure on the upcoming ballot.
City Manager Freeland stated that a super majority vote was needed from Council in order
to approve placing said measure on the ballot. He also discussed deleting the Maintenance
of Effort (MOE) for Senate Bill (SB) 1 regarding the gas tax increase. Mr. Freeland also
indicated that this bill would be placed on the upcoming ballot for repeal and had two
options for Council consideration which included: returning the grant from the State
Controller's Office in order to keep General Fund monies or cut the MOE with the
possibility that SI3 1 would be eliminated during the November election. He explained that
if SB 1 were to pass at the upcoming election, the City would need to reevaluate the
General Fund contribution towards transportation. Furthermore, he clarified that the City
was slated to receive $1.8 million in transportation funds next year, with the stipulation that
the City would spend $567,148 of General Fund dollars. In the event the City did not
collect the grant for the next two years, if they chose to collect the year after, they would be
forced to pay the retroactive pay for the previous two years.
Interim Finance Director Lancaster stated that there were still financial challenges that
needed to be resolved and gave a brief overview regarding the impact of the proposed cuts
on the General Fund in future fiscal years.
Councilman Spence asked if the numbers in the overview reflected the change in the West
Covina Plaza's mall sales tax.
City Manager Freeland stated that those additions had not been included in the PowerPoint
Presentation.
Interim Finance Director Lancaster briefly reviewed all current Capital Improvement
Projects (CIP) and the expenditures. She also informed Council of the upcoming budget
workshops occurring July 11, 2018 and July 19, 2018, if necessary.
At 9:30 p.m. Mayor Johnson proceeded to Oral Communications for the public.
ORAL COMMUNICATIONS
Jerri Potras suggested for Council to defund the open police positions instead of
eliminating them completely.
Bill Robinson suggested for Council to implement a hotline where residents and City staff
alike, could voice their concerns anonymously regarding the budget, and provide solutions
to remedy the financial decline of the City with no possibility of retaliation.
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Monday July 02, 2018
Chris Miller expressed concerns regarding the increase in sales tax of the City.
Councilman Spence, City Attorney Hall Barlow, and City Manager Freeland gave
responses to speaker inquiries.
2) Resolution to Continue Fiscal Year 2017-18 Appropriations
It is recommended that the City Council adopt the following resolution:
RESOLUTION NO. 2018-96 - A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF WEST COVINA, CALIFORNIA, TO CONTINUE APPROPRIATIONS
CONSISTENT WITH THE ADOPTED FISCAL YEAR 2017-18 CITY OF WEST
COVINA AND THE SUCCESSOR AGENCY TO THE FORMER WEST COVINA
REDEVELOPMENT AGENCY OPERATING BUDGETS AND THE CAPITAL
IMPROVEMENT PROGRAM UNTIL THE ADOPTION OF THE FISCAL YEAR 2018-
19 ANNUAL BUDGET
City Manager Freeland asked to discuss Item No. 3 before Item No. 2.
Mayor Pro Tern Wu expressed concerns regarding the high amount of sales tax in the
City.
Councilmember Tom expressed his approval regarding public comments and suggestions
concerning the City's budget. He also stated that with the yearly increase in PERS costs,
there was not enough revenue available to keep the budget balanced.
Mayor Pro Tern Wu expressed concerns regarding the amount of City expenditures and
the proposed increased tax rate.
City Manager Freeland explained that due to a conflict in schedules with the
Councilmembers, the next Budget Workshop Meeting would be rescheduled to July 12,
2018 at 6:30 p.m.
After a more in-depth discussion between Councilmembers and City Manager Freeland, a
motion was made by Mayor Johnson and seconded by Councilmember Toma to hold over
the resolution to continue Fiscal Year 2017-18 Appropriations until July 12, 2018 for
further Council discussion. Motion was carried by a vote of 4-1 with Councilman Spence
in opposition.
AYES: Tama, Warshaw, Wu, Johnson
NOES: Spence
ABSENT: None
City Manager Freeland suggested for the adoption of the budget policy to be made after
the City's budget is finalized.
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Monday July 02, 2018
Councilmember Toma expressed concerns regarding City Manager Freeland's suggestion.
ADJOURNMENT
A motion was made by Mayor Johnson to adjourn the meeting at 9:59 p.m.
Ro'salia A:13titlerkVIMC
Assistant City Clerk
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