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Home My WebLink About05/18/04CITY CLERK AGENDA ADJOURNED REGULAR MEETING HERMOSA BEACH CITY COUNCIL Tuesday, May 18, 2004 - 7:10 p.m. Council Chambers, City Hall 1315 Valley Drive MAYOR CITY CLERK Art Yoon Elaine Doerfling MAYOR PRO TEM CITY TREASURER J. R. Reviczky John M. Workman COUNCIL MEMBERS CITY MANAGER Sam Y. Edgerton Stephen R. Burrell Michael Keegan CITY ATTORNEY Peter Tucker Michael Jenkins CALL TO ORDER PLEDGE OF ALLEGIANCE ROLL CALL PUBLIC PARTICIPATION: Although the City Council values your comments, the Brown Act generally prohibits the Council from taking action on any matter not listed on the posted agenda. 1. PRELIMINARY BUDGET REVIEW a. OVERVIEW OF BUDGET CHANGES b. OVERVIEW OF REVENUE CHANGES c. REVIEW OF DEPARTMENT EXPENDITURES RECOMMENDATION: Review and provide direction to staff. ADJOURNMENT NOTE: THIS MEETING WILL BE TELEVISED LIVE ON ADELPHIA CABLE 1 10 AP • May 13, 2004 Honorable Mayor and Members of The Hermosa Beach City Council • Adjourned Regular meeting of May 18, 2004 1 PRELIMINARY BUDGET PRESENTATION The following is intended to highlight various issues, proposals and projects that are contained in the 2004-05 Budget. These items will be covered in the budget study session but I wanted to provide some additional background that may be helpful to the City Council in considering these items. During the budget study session last year, staff was able to provide a forecast of the cost increases that the City would be facing as a result of the very large increases in the cost of the retirement programs and the loss of sales tax as a result of the two new car dealerships leaving the City. As directed by the City Council, a number of cost saving actions were taken, some have been implemented during the present fiscal and others are set for City Council consideration during this budget study session. As you know, we set up a special fund to save up funds for the increase in retirement costs which will hopefully get us through this period of increasing costs as the retirement system begins earning is stated actuarial goal. We have set aside funds that will cover the known increases for the 2005-06 fiscal year. Staff has also provided information and changed the fleet fund and extended the useful life of a number of vehicles and dropped a number of vehicles, which will reduce the cost to the general fund. The Recreation Department fees have been reviewed and set at market rates and these were approved by the Parks Commission. There are some additional fees that are proposed in the budget that the City Council needs to review and approve. These proposed changes are the result of City Council direction to balance the cost and revenue of the Community Resources Department. There is a proposal to increase the encroachment fees for the outdoor dining on Pier Plaza. The proposal is the same as we recently approved for the Loreto Plaza lease arrangement. This is proposed to increase to $2.00 per square foot from the present $1.00. There are a number of other fee and revenue ideas that will be presented in order to maintain the present level of service provided to residents, businesses and visitors. Other proposals to increase revenue are being suggested to allow for additional effort in repairing and replacing residential streets, sewers and City building and other facilities. Streets - Staff has completed and we will present the Pavement Management Report, which details the present conditions of the City streets. The Plan recommends that the City spend $16,506,367 over the next five years. This would be in excess of over $3,000,000 per year. The plan, however, clearly shows that we are not spending enough on repair and maintenance of streets. This is not news to anyone, however, it does give us a target to work towards in bringing the street system up to reasonable standard. This amount is by itself is not unreasonable as this is typical of the effort that other cities are able to spend on a per mile basis. Some of our neighboring cities spend a great deal more. There are a number of ways that we could get that number including an 1 assessment district approach or transferring general funds to the capital improvement fund. During the last several years, a great deal of money has been spent on streets and it is beginning to show, however the backlog is fairly large and, based on the rate we have been able to proceed, it will be 15 to 20 years at the present spending rate. Sewers - As you will see in the sewer fund, the past and current projects have used the funds set aside and the cost of the ongoing maintenance and operation takes most of the amount that we have transferred to the fund. There are virtually no capital funds for repair and replacement of major sewer lines. In addition, the sewer condition study, completed in 1996 needs to be updated to ensure that we are spending on the most needed lines and also to get updated cost projections for those lines next in the repair cycle. It is recommended that the City Council consider authorizing a sewer condition update and a sewer fee that would be charged on a parcel basis to cover the cost of the maintenance, operation and capital needs of the sewer system. Redondo Beach just completed such a study and implemented a user fee and I understand that Manhattan Beach is also considering such an effort. If we were to do such a study, it would be done during the fiscal year. Street Sweeping Charge - A number of cities have added the cost of street sweeping to the refuse bills. Torrance and Redondo Beach have implemented such a fee and others are considering it. This would move this cost from the general fund and free funds for other activities. The cost of street sweeping this year will be $209,154. If the City Council is interested in this idea, staff will develop an implementation plan for consideration and approval. Parks - The effort over the last 10 years to add or improve the major parks has been successful. This years' budget has some choices for the City Council to consider in the allocation of Park Fund revenues and the efforts of the Friends of the Park will assist the City in making these improvements. As additional funds becoming available, we should be able to keep up the existing parks and make improvements to our smaller parks, as they are needed. Parks are also generally in good shape and if we are able to continue the present maintenance effort they should stay in good condition. City Building and Facilities - The effort that has been made on the community center and City Hall have allowed these facilities to continue to serve the residents. The City Yard needs some attention and the first step included in this budget will be the removal of the oil well. The work that was done with the school district architect has provided an overview of a plan to begin a project to improve the facility in a phased approach. The budget also contains improvement to the existing fire station, which will be funded from the Fire Protection Fund. The major needs now are replacement roofs on most of the buildings. Staff will be developing a phased approach to deal with this need. Funding for this project will be presented along with the overall plan. Policy Initiatives - These items are often where the City Council and staff spend a great of deal time. The current list of issues includes the Working Group on the General Plan that is largely being handled by a subcommittee of the Planning Commission and a • • number of interested residents. This approach was taken because of the high cost of having a consulting team employed to update the General Plan. There will likely be some cost associated with this effort, beyond the use of staff time, once the effort is further along. The same can be said for the Select Committee working on the Historic Preservation Plan. Again, this work will most likely need some kind of an appropriation beyond the effort being expended by the residents involved and staff time dedicated to it. The proposed budget presently does not contain any funding for these efforts. Respectfully submitt d, Stephen R. Burrell City Manager • r I,• Fri • r - J -r opi 'Is &r± H) -r- nynv' tit •,1 r 1-1 t • ,_ I 1 144. ,x txe & a,- )u-t-D- (kattR tir' ) 0-1,., sly scl o yt CAPITAL IMPROVEMENT PROJECTS 2004-05 • STREET AND SAFETY IMPROVEMENTS - 2nd Street Resurfacing - Slurry/Crack Sealing at Various Locations - Concrete Road Reconstruction at Various Locations - Speed Humps - 20th Street, Valley Drive to Power Street - Pier Avenue, Hermosa Avenue to PCH - llth Place On -Street Parking CAPITAL IMPROVEMENT PROJECTS 2004-05 cont'd • STORM DRAIN IMPROVEMENTS - Sewer Improvements, Upgrade of Pump Stations PARK IMPROVEMENTS - Park Improvements • Re -sodding lawn, Lawn Bowling Club • Resurface hard court, Edith Rodaway Park • Replace play equipment, Fort Lots of Fun CAPITAL IMPROVEMENT PROJECTS 2004-05 cont'd • PUBLIC BUILDINGS & GROUNDS IMPROVEMENTS - Fire Station Upgrade - Public Works Yard Renovation - Community Center Theatre - Municipal Pier, Phase III, Architectural Upgrades - Exterior Painting/ City Buildings SOF CAPITAL MENT FUND (Transfer of Unused Funds from Z rd General Fund) 700,000 600,000 500,000 400,000 300,000 200,000 100,000 0 00,252 597,469 383,715 378,732 4,939 327,811 0 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 est est Total $3,359,825 sw t A "SOF CAPITAL IMPROVEMENT FUND EXPENDITURES 2,500,000 2,000,000 1,500,000 1,000,000 500,oq 0 j998,y9 j999,00 2000'01 2o0 -2002,03 ,377 Total $5,989,603 2, i 1, 4,0 788,724 ,225,308 3098 • 202x445 _ . _ 1 i j998,y9 j999,00 2000'01 2o0 -2002,03 ,377 Total $5,989,603 GENERAL FUND REVENUE OVERVIEW • Secured Property Tax 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 1 �0 0 O pelf 44. �°j41 ^o41 ^001, - 45 ryo4` ogpb� ,10 • Conservative increase of 7% • Governor's ERAF Reduction of $287,478 included in budget (Governor Revise $361,042) GENERAL FUND REVENUE OVERVIEW cont'd • Sales Tax 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,0000 1 1 1 ,y° • Decline of 18% due to loss of Volkswagen in 03-04, BMW in 04-05, includes new Savon GENERAL FUND REVENUE OVERVIEW cont'd .ia4 .. • 1 w''-�',' At • Utility Users Tax 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 It It • Represents 14% of General Fund revenue, up 11% over 2002-03 GENERAL FUND REVENUE OVERVIEW cont'd • Transient Occupancy Tax 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0 et # 50 (05)1\ t Aq Ao Al • Represents 7% of General Fund revenue, up 14% over 2002-03 • Increased 118% since 1998-99 with 2 new hotels and expansion of a third GENERAL FUND REVENUE OVERVIEW cont'd • Recommended Fee Increases: Community Center Classes, 4% overall increase approved by Park/Rec Commission, $47,930 New Facility Rental Application Fee, $20, $ 6,300 $80,320 New $10 Transaction Fee, Classes, Leagues, Tourneys, Encroachment Fees, Pier Plaza, $1/sq.ft to $2/sq.ft, $69,794 Total $204,344 t 3j ; NUE SOURCES VS. /ArtoPUBLIC SAFETY COSTS Police/Fire Costs Top 4 Revenue Sources Total $11.5m 7,480,320 Total $10.2m 5,238,833 ..r.4 A e-tti r. i4 :4 7 097;501 1x662,947 + ,200= 00 o 2000,00 4p000 ,p00'0p0 6,000 Po° „too Po° 2,p00'0°° , 4,p00'0p0 0 Secured Prop Tax El Sales Tax CI UUT W TOT CONSIDERATION OF OTHER REVENUE INCREASES • Sewer Use Fee • Street Sweeping Charge • Ambulance Transport • Lighting/Landscape Levy • City-wide User Fee Study • Smart Parking Meters • Consider Metering Lot A - *very preliminary estimates $400,000 * 200,000 * 50,000 * 200,000 * 50,000 * upto$1m * 150,000 * Legend REHABILITATION •—•—• Grind & Parlay —RSR — $luny *4' SOUTHWESTZONE� COST ESTIMTE6 tat id TOTAL REHABILITATION COSTS f4AW.SR TOTAL auRRY RROORA4 C08T5. $3.W7.3 65 \ *RISS. !STD NORTHEAST ZONE o, LEGEND — Gaya 1 overlay — RLR — 59Nry CAST ESTIMATES NORTHEAST ZONE RENASLRATION COST: 11.059.011 SMEAR RECURRRIO SLURRY PROGRAM: 1193.209 • SOUTHEAST ZONE LEGEND Grind & Overlay R&R SNry COST ESTIMATES SOUTHEAST ZONE REHABITATION COST: S1.121.694 5 -YEAR RECURRING SLURRY PROGRAM: 5352.199 • SOUTHWEST ZONE Legend — Grind S CherWy RSR — Slurry COST ESTIMATES NORTHEAST ZONE REHABILITATION COST: S2.325.033 SSA RECURRING SLURRY PROGRAM-. $728838 NORTHWEST ZONE LEGEND — GM]4 Oadav — RLR - SkirrY COST ESTIMATES NORTHEAST REMAIMUTATO1 COST S2.310 OM 5 -YEAR RECURRING SLURRY PROGRAM 51.007.347