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10/12/99
q 603D 9 ( 9 9-- / \JI we - "Bgtwtzon tomorrow's drgam and y stgrday's rggr¢t, is today's opportunity." AGENDA REGULAR MEETING HERMOSA BEACH CITY COUNCIL Tuesday, October 12, 1999 - Council Chambers, City Hall Regular Session - 7:10 p.m. MAYOR Julie Oakes MAYOR PRO TEM J. R. Reviczky COUNCIL MEMBERS Robert Benz John Bowler Sam Y. Edgerton CITY CLERK Elaine Doerfling CITY TREASURER John M. Workman CITY MANAGER Stephen R. Burrell CITY ATTORNEY Michael Jenkins All council meetings are open to the public. PLEASE ATTEND. The Council receives a packet with detailed information and recommendations on nearly every agenda item. Complete agenda packets are available for public inspection in the Police Department, Fire Department, Public Library, Office of the City Clerk, and the Chamber of Commerce. During the meeting, a packet is also available in the Council foyer. CALL TO ORDER PLEDGE OF ALLEGIANCE ROLL CALL ANNOUNCEMENTS PROCLAMATIONS / PRESENTATIONS: DOMESTIC VIOLENCE AWARENESS MONTH OCTOBER, 1999 1 CERTIFICATE OF RECOGNITION TO THE CIVIC LIGHT OPERA OF SOUTH BAY CITIES, THE HERMOSA BEACH PLAYHOUSE AND JAMES BLACKMAN 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. (a) ORAL COMMUNICATIONS Members of the public wishing to address the City Council on any items within the Council's jurisdiction may do so at this time. (Exception: Comments on public hearing items must be heard during the public hearings.) Members of the public wishing to request the removal of an item from the Consent Calendar may do so at this time. Please limit comments to three minutes. Citizens also may speak: 1) during discussion of items removed from the Consent Calendar; 2) during Public Hearings; and, 3) with the Mayor's consent, during discussion of items appearing under Municipal Matters; Citizens with comments regarding City management or departmental operations are requested to submit those comments to the City Manager. (b) WRITTEN COMMUNICATIONS 1. Letter from Jeff Ginsburg requesting the prohibition of bicycles in Noble Park. RECOMMENDATION: Receive and file. 2. Letter from Jim Lissner request to make presentation to the City Council. RECOMMENDATION: Receive and file. 1. CONSENT CALENDAR: The following more routine matters will be acted upon by one vote to approve with the majority consent of the City Council. There will be no separate discussion of these items unless a Council member removes an item from the Consent Calendar. Items removed will be considered under Agenda Item 3, with public comment permitted at that time. 2 • • (a) Recommendation to approve minutes of the regular meeting of the City Council held on September 14, 1999. (b) Recommendation to ratify check register and to approve cancellation of certain checks as recommended by the City Treasurer. (c) Recommendation to receive and file Tentative Future Agenda Items. (d) Recommendation to receive and file memorandum regarding the August 1999 financial reports. Memorandum from Finance Director Viki Copeland dated October 7, 1999. (e) Recommendation to accept and appropriate the following donations given to the Community Resources Department and to the Police Department for the following purposes: Roller Hockey Program Round Table Pizza - $250.00 Tony Maroni's Famous Gourmet Pizza - $150.00 D.A.R.E. Program Dee Strange - $25.00 Memorandum from Finance Director Viki Copeland dated October 5, 1999 (f) Recommendation to award•contract for Traffic Signal Improvements at Hermosa Avenue and 146 Street and Hermosa Avenue and 136 Street to Inspection Engineering Construction of Costa Mesa in the amount of $164,759.00. Memorandum from Public Works Director Harold Williams dated September 29, 1999. (g) Recommendation to adopt:resolution-approving Final Map #25093 for a 2 -unit condominium at 1646-1648 Loma Drive. Memorandum from Community Development Director Sol Blumenfeld dated October 4, 1999 (h) Recommendation to rescind the award made to BFL/Owen, Inc. and authorize staff to issue a change order to Gordon H. Chong & Partners for CIP 96-624 North Pier Parking Structure. Memorandum from Public Works Director Harold Williams dated September 30, 1999. 3 (i) • • Recommendation to deny the following claims and refer them to the City's Liability Claims Administrator. Memorandum from Personnel Director/Risk Manager Michael Earl dated October 6, 1999. Claimant: Brooks, Jeffrey A. Date of Loss: 08/30/99 Date Filed: 09/21/99 Claimant: USAA as Subrogee of Erik Armstrong Date of Loss: 05/30/99 Date Filed: 10/05/99 Claimant: Plenge, Wendi Brunell Date of Loss: 08/11/99 Date Filed: 09/30/99 Recommendation to award the design'contract for CIP 98-621 Phase III Municipal Pier Architectural Upgrades to Purkiss Rose - RSI of Fullerton, California for a fee of $174,500. Memorandum from Public Works Director Harold Williams dated October 4, 1999. (k) Recommendation to deny application to file a late claim filed by Phillips Petroleum, et. al.. Memorandum from Personnel Director/Risk Manager Michael Earl dated October 6, 1999. (1) Recommendation that the City Council request that the Fiesta Subcommittee meet with the Chamber of Commerce and prepare a report for the December 14, 1999 meeting. Memorandum from City Manager Stephen Burrell dated October 7, 1999. 2. CONSENT ORDINANCES a. ORDINANCE' NO. 99-1194= "AN ORDINANCE OF THE CITY OF HERMOSA BEACH, CALIFORNIA, AMENDING SECTION 10.32.250 OF THE MUNICIPAL CODE TO REMOVE THE HOURS OF ENFORCEMENT FOR GREEN CURB MARKINGS." For adoption. Memorandum from City Clerk Elaine Doerfling dated October 4, 1999. 3. ITEMS REMOVED FROM THE CONSENT CALENDAR FOR SEPARATE DISCUSSION. * Public comments on items removed from the Consent Calendar. 4 • • PUBLIC HEARINGS - TO COMMENCE AT 7:30 P.M. 4. A GROUND LEASE OF CITY OWNED PROPERTY BETWEEN THE CITY OF HERMOSA BEACH AND 1301 HERMOSA AVENUE LLC TO DESIGN, CONSTRUCT, MAINTAIN AND OPERATE A RETAIL BUILDING LOCATED AT 1303 HERMOSA AVENUE. Memorandum from City Manager Stephen Burrell dated October 7, 1999. RECOMMENDATION: Continue item to October 26, 1999. MUNICIPAL MATTERS 5. cRESOLUTION AUTHORIZING THE TRANSFER OF THE CABLE TELEVISION FRANCHISE FROM CENTURY COMMUNICATIONS CORPORATION TO ADELPHIA COMMUNICATIONS CORPORATION. Memorandum from Community Resources Director Mary Rooney dated September 20, 1999. RECOMMENDATION: 1) Listen to presentation by Adelphia; 2) adopt turgency ordinance amending Ordinance No. 94-1117 which granted a nonexclusive Franchise for the operation of a cable television system within the City and declaring the urgency thereof, 3),introduce ordinance,amending Ordinance No. 94-1117 which granted a nonexclusive Franchise for the operation of a cable television system within the City; and, 4)•adopt resolution -authorizing the transfer of control of the Cable Television Franchise by Century Communications Corporation to Adelphia Communications Corporation. 6. PROPOSAL TO ENACT A MORATORIUM ON THE CONVERSION OF EXISTING COMMERCIAL SPACE TO RESTAURANT USE IN THE DOWNTOWN AREA AS DEFINED. Memorandum from City Manager Stephen Burrell dated September 9, 1999. RECOMMENDATION: That the City Council consider whether or not to adopt a moratorium on the conversion of commercial uses to restaurants until the Specific Plan study is completed. 7. DOWNTOWN SPECIFIC PLAN. Memorandum from Community Development Director Sol Blumenfeld dated October 4, 1999. RECOMMENDATION: Direct staff as deemed appropriate. 5 • • 8. CERTIFICATION OF RESULTS OF SIGNATURE VERIFICATION OF AN INITIATIVE PETITION PROPOSING TO ESTABLISH RESTRICTIONS AND REQUIREMENTS FOR USE OF THE BEACH FOR TEMPORARY EVENTS AND COMMERCIAL ADVERTISING. Memorandum from City Clerk Elaine Doerfling dated October 4, 1999. RECOMMENDATION: Direct staff as deemed appropriate. 9. CERTIFICATION OF RESULTS OF SIGNATURE VERIFICATION OF AN INITIATIVE PETITION PROPOSING TO ESTABLISH LIMITS ON THE NUMBER OF CONSECUTIVE TERMS WHICH MAY BE SERVED BY CITY COUNCIL MEMBERS. Memorandum from City Clerk Elaine Doerfling dated October 4, 1999. RECOMMENDATION: Direct staff as deemed appropriate. 10. MISCELLANEOUS ITEMS AND REPORTS - CITY MANAGER NONE 11. MISCELLANEOUS ITEMS AND REPORTS - CITY COUNCIL NONE 12. OTHER MATTERS - CITY COUNCIL Requests from Council members for possible future agenda items: Recommended Action: 1) Vote by Council whether to discuss this item; 2) refer to staff for a report back on a future agenda; or, 3) resolution of matter by Council action tonight. a. Request by Councilmember Benz that portable toilets be placed in the downtown area. ADJOURNMENT 10/5/99 7:29 AM FROM: 1 310 34111074 Norse, Future _Modern Day TO: +1 (• 372-6186 Jeff & Adriana Ginsburg 27032 Freeport Road Rancho Palos Verdes, CA 90275 (310) 541-6224 / Fax# (310) 326-8074 PAGE: 002 OF 002 OCT - 51999 CITY MANAGER'S OFFICE October 5, 1999 Hermosa Beach City Council do City of Hermosa Beach 1315 Valley Drive Hermosa Beach, CA 90254 RE: 14th Street Park Dear Sirs, My family and I are frequent visitors of your 14th street park on the strand... Until recently it has been a great place to visit with my kids, however, for some reason, lots of kids, and adults too, have been using the hills at the park for jumping their bikes. They have contests, etc to see who can jump the highest. To say the least the park, during these times, is VERY DANGEROUS for little children. I am confident that if you do not find a way to control the bike problem at the park that not only will the park grass and other landscaping be completely destroyed but a child will be seriously hurt or killed. The last time the police patrolled the park I asked the officer why they do not get involved and his comment was that until there is a sign prohibiting the biking activities, all they can do is watch as they have no authority to force them to leave. With a sign they said they could ticket anyone that ignores their warnings and that after a few tickets are handed out that they are confident the park's abuse would be drastically reduced or eliminated. Clearly a sign is desperately needed at this park prohibiting the use of bikes. The strand is the appropriate place for bikes and the park is designed for and only appropriate for walking, lying down on the grass, etc. Please consider this request at your next city council meeting. Sincerely, Jeff Ginsburg b1 OCT -06-99 WED 01:05 J.H.LISSNER 310 3762287 P.01 • • FACSIMILE COVER SHEET Total number of pages including this cover sheet 1 Date WED 10--6-99 Time To/Recipient Hermosa Beach City Council Fax number auto Voice phone number (310) 318-0216 From/ James Lissner, 2715 El Oeste, Hermosa Beach, CA 90254 Sender: Fax number: (310) 376-2287 Voice number: (310) 376-4626 There is an answering machine on this line and it picks up after 5 rings. Message: PLEASE AGENDIZE FOR NEXT COUNCIL MEETING, UNDER WRITTEN COMMUNXCATIONS FROM THE PUBLIC Subject: A BALANCED BUDGET IN 2000 - WAYS TO REDUCE EXPENDITURES, INCREASE REVENUES We have been overlooking a number of opportunities to reduce expenditures and increase revenues. Council action will be required in order for the city to take advantage of these opportunities. 1 would like to speak before you and provide the details. This is not a commercial solicitation. Thank you, Important: The pages comprising this facsimile transmission contain confidential information from .lames Lissner_ This information is intended solely for use by the individual or entity named as the recipient hereof. If you are not the intended recipient, be aware that any disclosure, copying distribution, or use of the contents of this transmission is prohibited, If you have received this transmission in error, please notify us by telephone immediately no that we may arrange to retrieve this transmission at no Coat to you. b2 • Balancing the Budget in 2000 Additional Revenues Transient Occupancy (hotel/motel bed) Tax: The tax is presently 10%. Most cities charge 10%, but some charge more (San Francisco is 14%). Increasing ours would bring in an additional $222 at 14%. A vote of the electorate may be required. Sales Tax: The city can, through inexpensive measures such as thorough street and sidewalk cleaning, the abatement of weeds and excess signage, the siting of special events there, as well as simply talking about those areas, stimulate business in areas of town that have been neglected and whose sales tax receipts have not increased in step with the economy. Recent sales tax receipts from the PCH, Aviation, and Pier Avenue (Valley to Monterey) areas were $849K, only 12% more than they were 2 years previously (=6% compounded). A 10% increase in business there would bring in another $85K annually. Sales tax from the downtown was up 24% compared to 2 years ago - but that increase represents only 11% compounded annually, and only 5% (compounded) more than the growth in the other areas of town. It also is a growth far less than the apparent increase in foot traffic in the downtown. The city should encourage the Board of Equalization to audit for compliance. An audit should find at least 10% additional tax, which would bring in another $35K annually. Business License Fees: Business licenses fees are projected to bring in $575K. The fee should be increased for those businesses known to regularly require disproportionate amounts of city service. Among those are the 88 businesses with liquor licenses. The fee for all liquor businesses should be increased somewhat - probably about a $500 increase for the stores and restaurants that close by 10 p.m. (and double that when they are bigger than 2000-2500 sq. ft.). The increase on places that close by 10 would bring in an additional $17K. The fee increase for those that serve or sell after 10 p.m. could be $4000 (and double that when they are over 2000-2500 sq. ft.), and would bring in an additional $188K. The total potential increase in business license fees for liquor businesses would be $205K. Police: • Presently the hourly charge for police event security is $65, with some events getting that service at an "at cost" rate of approximately $32. The actual hourly cost of our police is about $106. This service is projected to bring in $60K this fiscal year. Adjusting the rates to actual cost will bring in at least another $38K. Presently the city is not participating in the GALE grant program for under -age liquor enforcement. Our neighboring 3 cities have a $100K grant. If we participated, we could get approximately $40K. Sidewalk Dining Rent: The city presently charges 50 cents per foot, so we get $55K. The space is worth $2 per foot, and at that rate would bring in another $165K. Reducing Expenses City Hall Remodel: A $900K city hall remodel is coming through the planning process. It includes such things as $115K of A/V equipment, which would very quickly be obsolete, drywalling the perfectly good brick walls inside the council chambers, granite counter tops in many places, a new office for the fire chief, and air conditioning throughout. This project could be cut in half, with only 1/2 of what remains to be done now, and the rest in a year or two. Annual savings of $225K. Council Compensation: The councilmembers presently receive total pay (plus car allowance) of $40K annually. We presently have no shortage of people willing to -run for council. The pay could be reduced by $20K. Staff Salaries: The fire chief we had had so little to do that he was made project planner for the city hall remodel. The fire chief position should be eliminated, with the work spread among the police chief and the fire captains. The savings, including salary, car, and pension, would be approx. $200K annually. Traffic Signals: The traffic signals at 13th and 14th Streets are about to be replaced, at a cost, including city staff supervision, of approx. $200K. There is no need for signals at those locations, so when the present signals are no longer serviceable, they should be removed and replaced with stop signs. Reallocation of Surplus: We had a million dollar surplus last fiscal year. This February that surplus was split up among the equipment replacement fund, the insurance fund, and the capital improvement fund. If we have a surplus this year, and we may because of big increases in property tax revenue, the first $500K of it should go into the general fund to pay police salaries. Total: $1935K • • A, ra - /2 -get MINUTES OF THE REGULAR MEETING OF THE CITY COUNCIL of the City of Hermosa Beach, California, held on Tuesday, September 14, 1999, at the hour of 7:20 P.M. PLEDGE OF ALLEGIANCE - Shirley Cassell ROLL CALL: Present: Benz, Bowler, Edgerton, Reviczky, Mayor Oakes Absent: None PRESENTATION: PRESENTATION OF PLAQUE TO PETER TUCKER IN RECOGNITION OF HIS SERVICE ON THE PLANNING COMMISSION Former Planning Commissioner Peter Tucker was not present to receive his plaque. Mayor Oakes said the plaque would be forwarded to him and expressed appreciation for his many years of excellent service to the community. ANNOUNCEMENTS: Mayor Oakes announced and invited all residents to participate in the millennium aerial hometown photograph at the beach Sunday, September 19, 1999 from noon to 3:00 P.M. She reminded everyone that October 1, 1999 was the deadline for purchasing, at $100 each, millennium walkway bricks, which could be engraved. She then announced that Saturday, September 18, 1999 was California Coastal Cleanup Day from 9:00 A.M. to noon, and said this was an excellent event to help keep the beaches clean and educate the children. Councilmember Edgerton said there would be a dunk tank at the hometown photo site and encouraged all Councilmembers to take a turn getting dunked, noting that the proceeds would benefit the Hermosa Beach Education Foundation. PUBLIC PARTICIPATION: (a) ORAL COMMUNICATIONS Coming forward to address the Council at this time were: John Workman - City Treasurer, announced that the South Bay/Torrance Salvation Army's 7th Annual Health and Resource Fair for senior citizens, and caregivers would take place Saturday, September 18, 1999, from 10 A.M. to 4 P.M. at the Salvation Army facility at Emerald and Earl streets, behind Little Company of Mary; said there would be about 50 participants, including pharmacists, and free health screenings, as well as food, entertainment, and antique cars on display; said flyers were in the foyer; Shirley Cassell - Hermosa Beach, said Councilmember Edgerton again did not have his $4,000 laptop computer; reviewed and objected to the amount City Council Minutes 09-14-99 Page 10060 /'i la • • of money spent over the past year or so on the tennis courts and skateboard park; questioned the City Manager's removal of citizen comments from the end of the agenda (Mayor Oakes said she had requested that change because there was ample time for citizen comments at the start of the meetings and because the Council often has to stay after the meetings to attend closed sessions, which may last until 1:00 A.M.); and Jim Lissner - 2715 El Oeste, requested that consent calendar items 1(j) and (k) be pulled for later discussion; said the recent 30 -day delay in the process experienced by a proposed restaurant was due to improper noticing and showed the Council a picture he had taken of the notice located behind two trees. (b) WRITTEN COMMUNICATIONS 1. Letter from various residents regarding a vicious dog on Third Street. Coming forward to address the Council on this item was: Michael Glassman - Hermosa Beach, said he was the owner of the 7 -year-old dog involved and that he had taken corrective measures, including the installation of a gate at the entrance to his house and the hiring of a professional trainer, to ensure there would be no future incidents. Action: To receive and file. Motion Bowler, second Mayor Oakes. The motion carried by a unanimous vote. 2. Letter from the Heart of Hermosa Coalition requesting improvements to 14th Street. No one came forward to address the Council on this item. Action: To receive and file the letter, the residents work with staff regarding beautify the barricades to determine proposed improvements. Motion Mayor Oakes, second Bowler. The a unanimous vote. and suggest that their request to the cost of the motion carried by 3. Letter and petition from Phyllis Macek regarding the barricade at Ocean View and Third Street. Coming forward to address the Council on this item was: Janet Taranto - 906 Third Street, responded to the petition requesting removal of the barricades until the required public hearings and a valid traffic study have been conducted; said a valid traffic study was done before and after the City Council Minutes 09-14-99 Page 10061 • • • barricades were put up; showed a traffic study map she had prepared (Mayor Oakes noted that the issue would be considered at the October 19, 1999 Planning Commission meeting). City Manager Burrell responded to questions, saying the final traffic report has been completed and the proposed change to the City's Circulation Element would designate that section of Ocean View as a walk street. Action: To receive and file. Motion Mayor Oakes, second Reviczky. The motion carried by a unanimous vote. 4. Letter from Parker Herriott regarding lighting and signage at Noble Park. Coming forward to address the Council on this item was: John Hales - 624 Eighth Place, said the Noble family had donated $90,000 for the park but there had been no follow-through by the City to maintain it; spoke of damage to the park, noting bike tracks over the tops of all the mounds; said the site was not intended to be a bike park and suggested posting signage prohibiting bicycle antics at the park; also suggested asking the Garden Club for landscaping recommendations (Mayor Oakes said she would welcome any advice from the Garden Club regarding trees that would thrive in the park). City Manager Burrell responded to Council questions. Action: To direct staff to -look into the posting of "No Bicycles In The Grass" signs at the park. Motion Reviczky, second Mayor Oakes. The motion carried by a unanimous vote. 5. Letter from Roger Bacon requesting approval of the Surfer's Walk of Fame Banner Program - Los Angeles Marathon 2000. Coming forward to address the Council on this item was: Roger Bacon - 1100 Pacific Coast Highway, spoke to his letter; presented directly to the Council letters from Los Angeles County Supervisor Don Knabe and Marathon sponsor Honda Motor Cars. Action: To approve the request to allow the display of a banner across Pacific Coast Highway near First Street for use by the Los Angeles Marathon 2000 for a 30 -day period, starting in early February 2000. Motion Benz, second Edgerton. The motion carried by a unanimous vote. City Council Minutes 09-14-99 Page 10062 • • 6. Letter from Jim Lissner regarding insurance for events. Proposed Action: To limit the number of letters a person may place on any agenda to two letters. Motion Benz, second Edgerton. That motion was withdrawn based on the advice of City Attorney Jenkins that the issue be brought back for action at a future meeting as it was not listed on this agenda. Action: Mayor Oakes, with Council consensus, directed staff to bring back at a future meeting the issue of limiting the number of written communications per agenda. Coming forward to address the Council on this item was: Jim Lissner - 2715 El Oeste, spoke to his letter regarding insurance for events. Action: To receive and file the letter. Motion Bowler, second Mayor Oakes. The motion carried by a unanimous vote. 7. Letter from Jim Lissner regarding the Fire Chief position. Coming forward to address the Council on this item was: Jim Lissner - 2715 El Oeste, spoke to his letter. Action: To receive and file. Motion Benz, second Bowler. The motion carried by a unanimous vote. 8. Letter from Jim Lissner requesting a sales tax breakdown by business catecrory within each geographic area. Coming forward to address the Council on this item were: Jim Lissner - 2715 El Oeste, spoke to his letter, noting that the breakdown would be an economic planning tool; and Scott Alden - 646 Sixth Street, said the suggestion made good business sense. City Manager Burrell responded to Council questions. Action: To direct staff to return with a proposal from HDL for business category breakdowns. Motion Edgerton, second Benz. The motion carried by a unanimous vote. 9. Letter from Jim Lissner regnesting quality, lighted, temporary restrooms on Pier Avenue. Coming forward to address the Council on this item was: Jim Lissner - 2715 El Oeste, spoke to his letter. City Council Minutes 09-14-99 Page 10063 • Action: To receive and file. Motion Benz, second Edgerton. The motion carried by a unanimous vote. 10. Letter from Jim Lissner regarding the appearance of, and tax revenue to the City from, Pacific Coast Highway. Coming forward to address the Council on this item was: Jim Lissner - 2715 El Oeste, spoke to his letter and submitted photographs. City Manager Burrell responded to Council questions. Action: To receive and file. Motion Benz, second Reviczky. The motion carried by a unanimous vote. 11. Letter from Jim Lissner regarding liquor sales to underage persons. Coming forward to address the Council on this item was: Jim Lissner - 2715 El Oeste, spoke to his letter; and David Guard - 717 Second Street, spoke regarding the Council proposal [noted under item (b)6.] to limit the number of letters; said the Council could not limit the public's right to speak. Action: To receive and file the letter. Motion Benz, second Edgerton. The motion carried by a unanimous vote. City Manager Burrell announced the request to continue public hearing item 5 to the September 28, 1999 meeting, noting that Planning Commission consideration would be postponed as well from September 21 to the October 19, 1999 meeting. 1. CONSENT CALENDAR: Action: To approve the consent calendar recommendations (a) through (v), with the exception of the following items which were removed for discussion in item 3, but are shown in order for clarity: (e) Reviczky, (j) Reviczky, (k) Reviczky for Jim Lissner, (m) Bowler, (o) Mayor Oakes, (p) Bowler, (q) Benz, (r) Bowler, (u) Reviczky, and (v) Benz. Motion Reviczky, second Edgerton. The motion carried by a unanimous vote. • No one came forward to address the Council on items not removed from the consent calendar. City Council Minutes 09-14-99 Page 10064 • • At 8:31 P.M., the order of the agenda was suspended to go to public hearing item 4. (a) RECOMMENDATION TO APPROVE THE FOLLOWING MINUTES: (1) Minutes of the Regular meeting held on July 13, 1999; (2) Minutes of the Adjourned Regular meeting held on July 27, 1999; (3) Minutes of the Regular meeting held on July 27, 1999; and, (4) Minutes of the Adjourned Regular meeting held on August 10, 1999. Action: To approve, as presented, the minutes of 1) the Regular Meeting of July 13, 1999; 2) the Adjourned Regular Meeting of July 27, 1999; 3) the Regular Meeting of July 27, 1999; and 4) the Adjourned Regular Meeting of August 10, 1999. (b) RECOMMENDATION TO RATIFY THE CHECK REGISTER NOS. 18295 THROUGH 18688, NOTING VOIDED CHECK NOS. 18419, 18441, 18447, 18473, 18559 AND 18607, AND TO APPROVE THE CANCELLATION OF CHECK NOS. 18197, 18309, 18313, 18468, 18569 AND 18600, AS RECOMMENDED BY THE CITY TREASURER. (Councilmember Benz requested a staff report on workman's comp but did not pull this item for discussion.) Action: To ratify the check register as presented. (c) RECOMMENDATION TO RECEIVE AND FILE TENTATIVE FUTURE AGENDA ITEMS. Action: To receive and file the tentative future agenda items as presented. (d) RECOMMENDATION TO RECEIVE AND FILE THE JULY 1999 FINANCIAL REPORTS: (1) Revenue and expenditure report; (2) City Treasurer's report; and (3) Investment report. Action: To receive and file the July 1999 financial reports as presented. (e) RECOMMENDATION TO ACCEPT AND APPROPRIATE THE FOLLOWING DONATIONS GIVEN TO THE COMMUNITY RESOURCES DEPARTMENT AND TO THE POLICE DEPARTMENT FOR THE FOLLOWING PURPOSES: (1) 1999 Sunset Concerts on the Beach Hill and Knowlton - $10,000.00 (2) Roller Hockey jerseys Hermosa Kiwanis Foundation - $500.00 (3) Chevron Surf Camp Chevron - $6,000.00 Surfrider Foundation - $1,000.00 City Council Minutes 09-14-99 Page 10065 • • • (4) D.A.R.E. Program Stephen and Celina Douglas - $360.00 Memorandum from Finance Director Viki Copeland dated September 7, 1999. This item was removed from the consent calendar by Councilmember Reviczky for separate discussion later in the meeting in order to publicly acknowledge and thank the donors. Action: To accept the donations listed above, which were given to the Community Resources and Police departments. Motion Reviczky, second Bowler. The motion carried by a unanimous vote. (f) RECOMMENDATION TO APPROVE LEASE AGREEMENTS BETWEEN THE CITY AND THE ASSOCIATION FOR RETARDED CITIZENS, EASTER SEALS SOCIETY AND SOUTH BAY CENTER FOR COUNSELING FOR SPACE IN THE COMMUNITY CENTER. Memorandum from Community Resources Director Mary Rooney dated July 19, 1999. Action: To approve the Parks, Recreation and Community Resources Commission and staff recommendation to approve the following Community Center lease agreements: (1) Association for Retarded Citizens for one year for Rooms 1, 2 and 15 (2,360 square feet) , at a monthly rent of $2,430.80 from October 1, 1999 through June 30, 2000, and $2,548.80 from July 1 through September 30, 2000; (2) Easter Seal Society for one year for Room 14 (920 square feet) at a monthly rent of $947.60 from October 1, 1999 through June 30, 2000, and $993.60 from July 1 through September 30, 2000; and (3) South Bay Center for Counseling for one year for Room 9 (419 square feet) at a monthly rent of $431.57 from October 1, 1999 through June 20, 2000, and $452.52 from July 1 through September 30, 2000. (g) RECOMMENDATION TO RECEIVE AND FILE ACTION MINUTES FROM THE PARKS, RECREATION AND COMMUNITY RESOURCES ADVISORY COMMISSION MEETING OF AUGUST 3, 1999. Action: To receive and file the action minutes from the Parks, Recreation and Community Resources Advisory Commission meeting of August 3, 1999. (h) RECOMMENDATION TO RECEIVE AND FILE ACTION MINUTES FROM THE PLANNING COMMISSION MEETING OF AUGUST 17, 1999. Action: To receive and file the action minutes from the Planning Commission meeting of August 17, 1999. (i) RECOMMENDATION TO APPROVE REAPPROPRIATION OF FUNDS FROM 1998-99 AND APPROPRIATE FUNDS FOR MAINTENANCE OF City Council Minutes 09-14-99 Page 10066 • • DOWNTOWN HOLIDAY DECORATIONS. Memorandum from Finance Director Viki Copeland dated September 1, 1999. Action: To approve the reappropriation of funds (total $141,792) from Fiscal Year 1998-99, as presented in the staff report, and appropriate funds ($1,200) for maintenance of the already budgeted downtown holiday decorations, as recommended by staff. (j) RECOMMENDATION TO APPROVE THE PURCHASE OF THREE (3) CNG TOYOTA CAMRIES, AT A COST OF $65,973.00, DIRECT FROM TOYOTA MOTOR SALES CORPORATE FLEET DEPARTMENT AS REPLACEMENT VEHICLES. Memorandum from Finance Director Viki Copeland dated August 31, 1999. Supplemental letter from James Lissner, 2715 El Oeste, dated September 10, 1999. This item was removed from the consent calendar by Councilmember Reviczky for separate discussion later in the meeting concerning the use of AQMD clean air grants to fund the purchase of the replacement vehicles. Action: To approve the purchase of three CNG Toyota Camries, at a cost of $65,973.30, direct from Toyota Motor Sales Corporate Fleet Department as replacement vehicles for the Public Works, Community Development and Finance departments, as recommended by staff. Motion Reviczky, second Mayor Oakes. The motion carried by a unanimous vote. (k) RECOZTh1ENDATION TO APPROVE THE PURCHASE OF TWO (2) POLICE DETECTIVE VEHICLES (ONE CHEVY IMPALA AND ONE DODGE INTREPID) FROM CORMIER CHEVROLET OF LONG BEACH AND CLAUDE SHORT DODGE OF SANTA. MONICA. Memorandum from Police Chief Val Straser dated August 24, 1999. Supplemental letter from James Lissner, 2715 El Oeste, dated September 10, 1999. This item was removed from the consent calendar by Councilmember Reviczky at the request of Jim Lissner, for separate discussion later in the meeting. Coming forward to address the Council on this item was: Jim Lissner - 2715 El Oeste, said he would rather see the money go to clean up the sidewalks on Pacific Coast Highway. Action: To authorize the purchase of two new police detective vehicles, as recommended by staff: 1) one Chevy Impala from Cormier Chevrolet of Long Beach at a cost of $20,332.76; and 2) one Dodge Intrepid from Claude Short Dodge of Santa Monica at a cost of $19,465.52. Motion Reviczky, second Benz. The motion carried by a unanimous vote. City Council Minutes 09-14-99 Page 10067 • • • (1) RECOMMENDATION TO APPROVE THE PURCHASE OF FIRE HOSE FROM SOUTH COAST FIRE EQUIPMENT, INC. OF SANTA ANA AT A COST OF $6,859.53. Memorandum from Interim Fire Chief Julian Ysais dated September 2, 1999. Action: To authorize the purchase of fire hose from South Coast Fire Equipment, Inc., at a cost of $6,859.53, from the Fire Flow Fund, as recommended by staff. (m) RECOMMENDATION TO APPROVE TRANSFER OF OWNERSHIP OF STINNETT WELL #1 FROM MACPHERSON OIL COMPANY TO THE CITY OF HERMOSA BEACH BY DESIGNATING THE CITY MANAGER AS "AGENT"; SUPPLYING THE REQUIRED BOND; AND, DIRECTING THE CITY MANAGER TO BEGIN THE PROCESS OF ABANDONING THE WELL. Memorandum from City Manager Stephen Burrell dated August 17, 1999. This item was removed from the consent calendar by Councilmember Bowler for separate discussion later in the meeting. City Manager Burrell responded to Council questions. Action: To 1) designate the City Manager as "agent," with the required bond to be supplied by the City, and 2) direct the City Manager to begin the process of abandoning the well, as recommended by staff. Motion Bowler, second Edgerton. The motion carried, noting the abstention by Reviczky. (n) RECOMMENDATION TO DENY THE FOLLOWING CLAIM AND REFER IT TO THE CITY'S LIABILITY CLAIMS ADMINISTRATOR. Memorandum from Personnel Director/Risk Manager Michael Earl dated September 7, 1999. Claimant: Date of Loss: Date Filed: Robert Suraci 08/01/99 09/07/99 Action: To deny the claim and refer it to the City's Liability Claims Administrator, as recommended by staff. (o) RECOMMENDATION TO APPROVE REQUEST FROM GREAT AUTOS OF YESTERYEAR CLASSIC CAR CLUB, A NON-PROFIT ORGANIZATION, TO CONDUCT A CAR CLUB DISPLAY ON THE PLAZA ON MARCH 4, 2000 FROM LOAM TO 3PM WITH REQUIREMENTS AND WAIVERS AS LISTED IN THE STAFF REPORT DATED SEPTEMBER 8, 1999. Memorandum from Community Resources Director Mary Rooney dated September 8, 1999. • This item was removed from the consent calendar by Mayor Oakes for separate discussion later in the meeting. Action: To approve the request from Great Autos of Yesteryear Classic Car Club, a non-profit organization, City Council Minutes 09-14-99 Page 10068 to conduct a car club display 2000 from 10:00 A.M. to 3:0 requirements/waivers listed in contract, as recommended by staf Motion Benz, second Mayor Oakes. unanimous vote. on the Plaza on March 4, 0 P.M., subject to the the staff report and the f. The motion carried by a (p) RECOMMENDATION TO AUTHORIZE SETTING UP A FUND TO RECEIVE CONTRIBUTIONS FROM DONORS TO PROVIDE FINANCIAL ASSISTANCE TO PROPERTY OWNERS IN THE LOMA DRIVE UTILITY UNDERGROUNDING ASSESSMENT DISTRICT. Memorandum from City Manager Stephen Burrell dated September 8, 1999. This item was removed from the consent calendar by Councilmember Bowler for separate discussion later in the meeting. City Manager Burrell responded to Council questions. Action: To authorize setting up a hardship fund to receive contributions from donors to provide financial assistance to property owners in the Loma Drive Utility Undergrounding Assessment District, as suggested by residents and recommended by staff. Motion Bowler, second Reviczky. The motion carried by a unanimous vote. (q) RECOMMENDATION TO RETAIN JOHN L. HUNTER AND ASSOCIATES, INC. TO ADMINISTER THE CITY'S MUNICIPAL STORM WATER PROGRAM AND IMPLEMENT NPDES PERMIT REQUIREMENTS FOR AN AMOUNT OF $35,120 AND AUTHORIZE THE MAYOR TO EXECUTE AND THE CITY CLERK TO ATTEST THE CONTRACT SUBJECT TO APPROVAL BY THE CITY ATTORNEY. Memorandum from Public Works Director Harold Williams dated September 1, 1999. This item was removed from the consent calendar by Councilmember Benz for separate discussion later in the meeting. City Manager Burrell responded to Council questions. Action: To approve the staff recommendation to: 1) Retain John 1. Hunter & Associates, Inc. to administer the City's Municipal Storm Water Program and implement NPDES permit requirements for an amount of $35,120; and 2) Authorize the Mayor to execute and the City Clerk to attest the contract subject to approval by the City Attorney. Motion Benz, second Reviczky. The motion carried by a unanimous vote. (r) RECOMMENDATION TO ACCEPT THE WORK BY PAVEMENT COATING COMPANY OF CYPRESS, ON CIP #98-141, STREET REHABILITATION, AND AUTHORIZE FINAL PAYMENT TO THE City Council Minutes 09-14-99 Page 10069 w • • • • CONTRACTOR. Memorandum from Public Works Director Harold Williams dated August 25, 1999. This item was removed from the consent calendar by Councilmember Bowler for separate discussion later in the meeting. Action: To accept the work by Pavement Coating Company on CIP Project No. 98-141, Street Rehabilitation, and authorize final payment to the contractor (10 percent retained for 35 days following filing of Certificate of Completion), as recommended by staff. Motion Bowler, second Reviczky. The motion carried by a unanimous vote. (s) RECOMMENDATION TO AWARD THE CONSTRUCTION CONTRACT FOR THE MONTEREY BOULEVARD STREET IMPROVEMENT PROJECT, 19TH STREET TO HERMOSA AVENUE, CIP #99-143, TO SULLY MILLER CONTRACTORS OF ANAHEIM, CALIFORNIA IN THE AMOUNT OF $184,545.00. Memorandum from Public Works Director Harold Williams dated August 26, 1999. Action: To approve the staff recommendation to: 1) Award the construction contract for the Monterey Boulevard Street Improvement Project, 19th Street to Hermosa Avenue (CIP 99-143), to Sully Miller Contractors of Anaheim in the amount of $184,545; 2) Authorize the Mayor to execute and the City Clerk to attest the construction contract subject to approval by the City Attorney; and 3) Authorize the Director of Public Works to make minor changes as necessary within the budget of $202,999. (t) RECOMMENDATION TO APPROVE THE CLASSIFICATION SPECIFICATIONS FOR PLANNING ASSISTANT AND PLANNING ASSOCIATE AS REVIEWED AND APPROVED BY THE CIVIL SERVICE BOARD. Memorandum from Personnel Director/Risk Manager Michael Earl dated September 9, 1999. Action: To approve the staff recommendation to approve the classification specifications for Planning Assistant and Planning Associate as reviewed and approved by the Civil Service Board. (u) RECOMMENDATION TO ADOPT RESOLUTION DESIGNATING THE USE OF UTILITY USERS TAX REVENUES. Memorandum from City Manager Stephen Burrell dated September 9, 1999. This item was removed from the consent calendar by Councilmember Reviczky for separate discussion later in the meeting. Coming forward to address the Council on this item was: Shirley Cassell - Hermosa Beach, asked why this was being done now; said it will not be needed if City Council Minutes 09-14-99 Page 10070 • • the measure to repeal the UUT is approved by the voters in November. Action: To approve the staff recommendation to adopt Resolution No. 99-6027, entitled "A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH, CALIFORNIA, DESIGNATING THE USE OF UTILITY USERS TAX FUNDS TO SEWER MAINTENANCE AND RENOVATION, PUBLIC SAFETY AND CAPITAL PROJECTS." Motion Reviczky, second Bowler. The motion carried by a unanimous vote. (v) RECOMMENDATION TO AWARD BID FOR PURCHASE OF A COMPAO PROLIANT 1600--500 MHZ FILE SERVER TO GE CAPITAL FOR $8,758.15 (INCLUDES TAX). Memorandum from Data Processing Technician Joe Duckett. This item was removed from the consent calendar by Councilmember Benz for separate discussion later in the meeting. Action: To award the bid for a Compaq Proliant 1600--500 MHz file server to GE Capital for $8,758.15, as recommended by staff. Motion Benz, second Reviczky. The motion carried by a unanimous vote. 2. CONSENT ORDINANCES a. ORDINANCE NO. 99-1193 - "AN ORDINANCE OF THE CITY OF HERMOSA BEACH, CALIFORNIA, AMENDING THE ZONING ORDINANCE, CHAPTER 17.28, WITH RESPECT TO USES PERMITTED AND CONDITIONALLY PERMITTED IN THE M-1 ZONE. For adoption. - Memorandum from City Clerk Elaine Doerfling dated September 7, 1999. Action: To waive full reading and adopt Ordinance No. 99-1193. Motion Bowler, second Mayor Oakes. AYES: Bowler, Edgerton, Mayor Oakes NOES: None ABSTAIN: Benz, Reviczky ABSENT: None 3. ITEMS REMOVED FROM THE CONSENT CALENDAR FOR SEPARATE DISCUSSION. Items 1 (e) , (j) , (k) , (m) , (o) , (p) , (q) , (r) , (u) and (v) were heard at this time but are shown in order for clarity. Public comments on items removed from the consent calendar are shown under the appropriate item. City Council Minutes 09-14-99 Page 10071 • • • PUBLIC HEARINGS 4. APPEAL TO THE HERMOSA BEACH CITY COUNCIL OF THE PLANNING COMMISSION DENIAL OF A CONDITIONAL USE PERMIT AMENDMENT TO ALLOW ON -SALE ALCOHOL IN CONJUNCTION WITH AN EXISTING RESTAURANT AND TO ADD A DANCING AREA AND LIVE ENTERTAINMENT, AND ADOPTION OF AN ENVIRONMENTAL NEGATIVE DECLARATION AT 1100 THE STRAND, "SCOTTY'S." (Continued from June 22, 1999 meeting). Memorandum from Community Development Director Sol Blumenfeld dated September 1, 1999. Supplemental letter from Alfred Salido, 40 Fourth Street, dated September 14, 1999. At 8:32 P.M., Councilmember Bowler left the dais and the room due to a potential conflict of interest. Community Development Director Blumenfeld presented the staff report and responded to Council questions. City Attorney Jenkins responded to Council questions, noting that, after reviewing the issue, it had been determined that Councilmember Benz did not have a conflict of interest with regard to this item. City Manager Burrell also responded to Council questions. The public hearing opened at 8:52 P.M. Coming forward to address the Council on this item were: Frank Wattles - Hermosa Beach, attorney representing the applicant, said he was contacted late today about a withdrawal by the applicant's previous attorney; requested a continuance to the next meeting to allow him sufficient time to review and prepare to adequately present the matter; Steve Hunt - Hermosa Beach, said Councilmember Benz should not put himself in the position of an appearance of a conflict of interest, since the applicant is his wife's landlord; expressed concerns about the proposed project; Al Brolundy - Hermosa Beach, said his house has had two instances of violent crime, and recently a breaking in and burglary while people were asleep in the house; and Shirley Cassell - Hermosa Beach, said those problems were not created by the applicant's restaurant. The public hearing closed at 9:10 P.M. Action: To continue the public hearing to the meeting of October 26, 1999, with direction to re -notice the item. Motion Mayor Oakes, second Benz. The motion carried, noting the absence of Bowler. 5. CERTIFICATE OF APPROPRIATENESS FOR INTERIOR AND EXTERIOR REMODEL TO A DESIGNATED HISTORIC LANDMARK BUILDING. REMODEL WILL INCLUDE SEISMIC RETROFIT OF BUILDING AND RENOVATION/REPAIR OF EXTERIOR ELEVATIONS WITH NO FLOOR City Council Minutes 09-14-99 Page 10072 • • AREA ADDED AT 1221 - 1235 HERMOSA AVENUE, BIJOU BUILDING. Memorandum from Community Development Director Sol Blumenfeld dated September 1, 1999. Supplemental letter from Jeff Mindes, CIM Group, dated September 14, 1999. This public hearing was continued at the request of CIM Group to the September 28, 1999 City Council meeting The meeting recessed at 9:14 P.M. The meeting reconvened at 9:37 P.M. MUNICIPAL MATTERS 6. EIGHTH STREET - EAST OF PACIFIC COAST HIGHWAY, TRAFFIC MITIGATION REQUEST. Memorandum from Public Works Director Harold Williams dated September 1, 1999. Public Works Director Williams presented the staff report and responded to Council questions. City Manager Burrell also responded to Council questions. Public participation opened at 9:45 P.M. Coming forward to address the Council on this item were: Stacey Montalto - 715 Prospect Avenue, agreed with the staff report and wanted to try the chokers on a six-month trial basis; said they also needed signage to stop wrong -way drivers; Donna Maryanski-Bebb - 1018 Eighth Street, said the chokers would slow the traffic at the opening at Prospect Avenue, but they needed to consider the left -turn signal eastbound onto Eighth Street from Pacific Coast Highway, which allows cars to go only 20 feet; and Steve Charney - 934 Eighth Street, thanked staff for their fast work; supported the chokers as long as they did not take any parking spaces away; said the street needed to be resurfaced and that perhaps it could be done at the same time the chokers were installed. Public participation closed at 9:55 P.M. Action: To approve the staff recommendation to: 1) Approve the installation of chokers on Eighth Street from Prospect Avenue to the half -street barricade located approximately 131 feet east of Pacific Coast Highway on a six-month trail basis, with additional direction for "right -turn only" signage at Ocean Drive; and 2) Direct staff to return to Council after the six- month trial period with a report of findings, with additional direction that the recommended proposals for permanent chokers be aesthetically pleasing. Motion Reviczky, second Mayor Oakes. The motion carried by a unanimous vote. City Council Minutes 09-14-99 Page 10073 • • 7. LIGHTED MARQUEE AT THEATER ENTRY FOR HERMOSA BEACH PLAYHOUSE. Memorandum from Community Resources Director Mary Rooney dated September 8, 1999. Community Resources Director Rooney presented the staff report and responded to Council questions. Public participation opened at 10:00 P.M. Coming forward to address the Council on this item was: James Blackman - executive director for the South Bay Civic Light Opera, spoke to the item and responded to Council questions. Public participation closed at 10:10 P.M. Action: To: 1) Approve the design and authorize the purchase of a marquee for the Theater entry with two of the four amendments recommended by the Parks, Recreation and Community Resources Commission - to narrow the width of the sign to allow space between the column details, and to allow adequate space between the bottom of the sign and the entry door to retain all building details; 2) Appropriate up to $17,000 from CIP account #99-627 (Community Center Improvements) to purchase the marquee; and 3) Authorize the entry name of "Hermosa Beach Playhouse" for the Civic Theater. Motion Benz, second Bowler. The motion carried by a unanimous vote. 8. REQUEST FOR APPROVAL OF ENCROACHMENT AT 2554 ARDMORE AVENUE. Memorandum from Public Works Director Harold Williams dated September 7,1999. Public Works Director Williams presented the staff report and responded to Council questions. Public participation opened at 10:14 P.M. Coming forward to address the Council on this item was: Dave Rosenball - property owner, said the wall would be stuccoed when the rest of the building was done; said he would maintain the landscaping and irrigation in the parkway in front of his home, expressed concern about the catch basin (Councilmember Reviczky wanted homeowners to be aware that some future Council may act to widen that street, and requested that staff evaluate the catch basin for improvements). Public participation closed at 10:16 P.M. City Council Minutes 09-14-99 Page 10074 • Action: To approve the staff recommendation to approve issuance of an encroachment permit for a six-foot fence as requested by the owners of the property at the corner of Gould and Ardmore avenues - 2554 Ardmore Avenue. Motion Edgerton, second Reviczky. The motion carried by a unanimous vote. 9. PROPOSAL BY COUNCILMEMBER EDGERTON TO ENACT A MORATORIUM ON THE CONVERSION OF EXISTING COMMERCIAL SPACE TO RESTAURANT USE IN THE DOWNTOWN AREA AS DEFINED. Memorandum from City Manager Stephen Burrell dated September 9, 1999. Supplemental letter from James Lissner, 2715 El Oeste, dated September 10, 1999. City Attorney Jenkins responded to Council questions. Councilmember Bowler left the dais and the room due to a potential conflict of interest, based on the opinion of the City Attorney. City Manager Burrell presented the staff report and responded to Council questions, noting that the ordinance required a four/fifths vote for adoption. City Attorney Jenkins and Community Development Director Blumenfeld responded to Council questions. Public participation opened at 11:20 P.M. Coming forward to address the Council on this item were: Jim Lissner - Hermosa Beach, said the moratorium did not deal with alcohol uses; suggested that the Council consider limiting business hours to an earlier than 2 A.M. time; and David Grem - owner of Shirt Tails at 34 Pier Avenue, spoke in support of the moratorium; said his was a family -run business for 25 years with a large clientele; said he was working on a long- term lease with plans to fix up the building; expressed concern that the adjacent restaurant wanted to expand into his space and add alcohol; said retail use was needed; Public participation closed at 11:30 P.M. Action: To continue the item to the October 12, 1999 meeting. Motion Edgerton, second Reviczky. The motion carried, noting the dissenting vote of Benz and the absence of Bowler. 10. MISCELLANEOUS ITEMS AND REPORTS - CITY MANAGER a. NEW PETITION EFFORT TO FORM A UTILITY UNDERGROUND ASSESSMENT DISTRICT. Memorandum from City Manager Stephen Burrell dated August 26, 1999. City Council Minutes 09-14-99 Page 10075 • • i • City Manager Burrell presented the staff report and responded to Council questions. There was no action was taken on this item. 11. MISCELLANEOUS ITEMS AND REPORTS - CITY COUNCIL - None 12. OTHER MATTERS - CITY COUNCIL a. Request from Councilmember Edgerton to increase the Pier Plaza cleaning schedule. Councilmember Edgerton spoke to his request. City Manager Burrell responded to Council questions. Action: To direct staff to return with a report regarding the cleaning schedule, including a steam cleaning of the plaza after events. Motion Edgerton, second Reviczky. The motion carried by a unanimous vote. b. Request from Councilmember Benz to change the operation of the 15 -minute parking zone from 7:00am to 6:00pm to 7:00am to 10:00pm. Councilmember Benz spoke to his request. City Manager Burrell responded to Council questions. Action: To direct staff to return with an ordinance to make the change. Motion Benz, second Edgerton. The motion carried by a unanimous vote. c. Request from Councilmember Edgerton to discuss status of changes to development standards for residential zones. Councilmember Edgerton withdrew this item. ADJOURNMENT - The Regular Meeting of the City Council of the City of Hermosa Beach adjourned on Tuesday, September 14, 1999, at the hour of 11:55 P.M. to the Regular Meeting of Tuesday, September 28, 1999, at the hour of 7:10 P.M. ter-. • Elaine Doerfling, City erk City Council Minutes 09-14-99 Page 10076 VOUCHRE2 09/27/99 08:22 VOUCHER/ CHECK CHECK NUMBER DATE VENDOR VENDOR NUMBER NAME • 18849 09/27/99 008955 AAE CONSULTANTS 18850 09/27/99 000003 ADVANCE ELEVATOR 18851 09/27/99 006230 ADVANCED CONSTRUCTION 18852 09/27/99 003209 AIR TOUCH CELLULAR 18853 09/27/99 000152 ARAMARK UNIFORM SERVICE 18854 09/27/99 008919 ASAP/GO AS A GROUP 18855 09/27/99 005179 AT&T 18856 09/27/99 000252 BEACH TRAVEL 18857 09/27/99 009759 BROOKES ELECTRIC COMPAN 18858 09/27/99 009742 RONALD BUEGEMAN 18859 09/27/99 005621 STEPHEN R. BURRELL 18860 09/27/99 000480 CA POLICE CHIEFS ASSOC 18861 09/27/99 004992 CALIF STATE FIREFIGHTER 18862 09/27/99 009141 CALIF. EMS AUTHORITY 18863 09/27/99 005935 CALIFORNIA STREET MAINT CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS ITEM DESCRIPTION STRAND BIKEWAY & WALKWAY PMT SAFETY TEST REQUIRED BY STATE TENNIS COURT CONTRACT CELL PHONE BILLING/JULY 99 CELL PHONE BILLING/JULY 99 CELL PHONE BILLING/JULY 99 SHOP TOWEL SERVICE/FIRE/AUG 99 SHOP TOWEL SERVICE/AUG 99 SHOP TOWEL SERVICE/AUG 99 MAT SERVICES/POLICE/AUG 99 MAT SERVICE/AUG 99 MAT SERVICE/COMM CENTER/AUG 99 SHOP TOWEL SERVICE/AUG 99 SHOP TOWEL SERVICE/AUG 99 MAT SERVICE/POLICE/AUG 99 MAT SERVICE/COMM CENTER/AUG 99 MAT SERVICE/AUG 99 FINAL PAYMENT/TRIP 12/17/99 LONG DISTANCE LONG DISTANCE LONG DISTANCE LONG DISTANCE LONG DISTANCE LONG DISTANCE LONG DISTANCE LONG DISTANCE LONG DISTANCE LONG DISTANCE LONG DISTANCE CHARG'S/AUG 99 CHRG'S/AUG 99 CHRG'S/AUG 99 CHRG'S/AUG 99 CHRG'S/AUG 99 CHRG'S/AUG 99 CHRG'S/AUG 99 CHARG'S/AUG 99 CHARG'S/AUG 99 CHRG'S/AUG 99 CHARG'S/8/24/99 AIRFARE/WILLIAMS/LEAGUE LOWER PIER AVE PROJECT jitatji"Q /0 -r2--(?? ACCOUNT NUMBER 121-8144-4201 001-4204-4201 126-8526-4201 001-2101-4304 001-2201-4304 001-4202-4304 001-2201-4309 715-4206-4309 001-3104-4309 001-2101-4309 001-4204-4309 001-4204-4309 715-4206-4309 001-3104-4309 001-2101-4309 001-4204-4309 001-4204-4309 001-4601-4201 001-2101-4304 001-1101-4304 001-1121-4304 001-1141-4304 001-1202-4304 001-1203-4304 001-4202-4304 001-2101-4304 001-2101-4304 001-4201-4304 001-2201-4304 001-4202-4317 105-8160-4201 CITATION REFUND/ADMIN HEARING 110-3302 PER DIEM/ICMA CONFERENCE 99/2000 ANNUAL DUES/STRASER 1999 CA FIRE SERVICE DIRECTORY EMT -PARAMEDIC RENEWAL/HAHN STREET SWEEPING/JULY 99 1 001-1201-4317 001-2101-4317 001-2201-4305 001-2201-4315 001-3104-4201 ITEM AMOUNT 5,098.72 500.00 46,019.25 365.39 36.62 77.51 14.43 25.55 11.15 51.46 41.18 60.22 25.55 11.47 51.46 41.18 60.22 1,039.87 10.75 1.14 .35 .23 2.18 .74 11.25 10.77 10.75 20.00 13.64 100.50 2,625.00 20.00 200.00 210.00 16.95 130.00 12,200.00 PAGE 1 CHECK AMOUNT 5,098.72 500.00 46,019.25 479.52 393.87 1,039.87 81.80 100.50 2,625.00 20.00 200.00 210.00 16.95 130.00 16 VOUCHRE2 09/27/99 08:22 VOUCHER/ CHECK CHECK NUMBER DATE VENDOR NUMBER VENDOR NAME • • CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS ITEM DESCRIPTION DOWNTOWN LOTS CLEANED/AUG 99 STREET SWEEPING/AUG 99 PORTER SERVICES/AUG 99 18864 09/27/99 009760 CARDINAL TRANSPORTATION DARE FIELD TRIP/10/05/99 18865 09/27/99 009753 CITY OF CARSON 18866 09/27/99 000634 CHEVRON USA, INC. 18867 09/27/99 009757 WILL CHUNG 18868 09/27/99 005970 DENNIS COLLINS REIMBURS TRAINING EXPENSE GAS CARD PURCHASE/AUG 99 RENTAL DEPOSIT REFUND INSTRUCTOR PAYMENT/SUMMER 99 18869 09/27/99 009614 CONTINENTAL MAPPING SER 300' NOTICING 18870 09/27/99 009756 KERRY COTTER CLASS REFUND 18871 09/27/99 008855 D & D DISPOSAL INC. DEAD ANIMAL DISPOSAL/AUG 99 18872 09/27/99 008359 DARE AMERICA MERCHANDIS DARE SUPPLIES/99/00 SCHOOL YR 18873 09/27/99 008518 DOUBLETREE HOTEL 18874 09/27/99 000122 DUNCAN INDUSTRIES 18875 09/27/99 009744 TAMI EATON LODGING/WILLIAMS/LEAGUE ELECTRONIC METERS PURCHASE CITATION REFUND/ADMIN HEARING 18876 09/27/99 008958 EMERGENCY PET CLINIC OF EMERGENCY VET SERVICE 18877 09/27/99 009610 EXECUTIVE STARR PRODUCT SKATE TRACK SECURITY/8/16-31 18878 09/27/99 001962 FEDERAL EXPRESS CORP. EXPRESS MAIL/JULY 99 EXPRESS MAIL/JULY 99 18879 09/27/99 003169 STEVE FILLMAN INSTRUCTORS PAYMENT/SUMMER INSTRUCTOR PAYMENT/SUMMER 99 18880 09/27/99 004685 FIRST CHOICE FIRE PROTE FIRE EXTINGUISHER SERVICE 18881 09/27/99 008931 FLEMING & ASSOCIATES,TR WORKER COMP CLAIMS/9/1-9/14/99 18882 09/27/99 009755 ROBIN FOX CLASS REFUND 18883 09/27/99 000015 GTE CALIFORNIA, INCORPO PHONE BILLING/AUG 99 PHONE BILLING/SEPT 99 PHONE BILLING/AUG 99 PHONE BILLING/AUG 99 PHONE BILLING/AUG 99 PHONE BILLING/AUG 99 PHONE BILLING/AUG 99 ACCOUNT NUMBER 109-3301-4201 001-3104-4201 109-3301-4201 001-2101-4305 001-1203-4317 715-2101-4310 001-2111 001-4601-4221 001-4101-4201 001-2111 110-3302-4201 001-2101-4305 001-4201-4317 715-3302-5499 110-3302 110-3302-4201 001-4601-4201 001-1202-4305 001-1201-4305 001-4601-4221 001-4601-4221 001-4204-4201 705-1217-4324 001-2111 001-2101-4304 001-2101-4304 715-1206-4304 110-3302-4304 001-2101-4304 001-4204-4321 001-2201-4304 ITEM AMOUNT 6,250.00 12,200.00 840.00 387.00 86.67 117.18 100.00 318.50 2,185.00 256.00 200.00 969.53 336.60 100,938.99 20.00 40.00 1,032.00 16.25 11.00 3,132.50 609.00 750.26 17,088.62 210.00 61.09 62.02 242.81 64.02 1,416.59 54.43 215.22 PAGE 2 CHECK AMOUNT 31,490.00 387.00 86.67 117.18 100.00 318.50 2,185.00 256.00 200.00 969.53 336.60 100,938.99 20.00 40.00 1,032.00 27.25 3,741.50 750.26 17,088.62 210.00 VOUCHRE2 09/27/99 08:22 VOUCHER/ CHECK CHECK NUMBER DATE VENDOR VENDOR NUMBER NAME CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS ITEM DESCRIPTION PHONE BILLING/AUG 99 PHONE BILLING/AUG 99 PHONE BILLING/AUG 99 PHONE BILLING/AUG 99 PHONE BILLING/AUG 99 18884 09/27/99 006354 HARDING LAWSON ASSOCIAT FINAL BILLING/PIER DESIGN 18885 09/27/99 003432 HOME DEPOT/GECF MAINTENANCE SUPPLIES/AUG 99 MAINTENANCE SUPPLIES/AUG 99 MAINTENANCE SUPPLIES/AUG 99 18886 09/27/99 000372 INDEPENDENT CITIES ASSO DEPOSIT/TULIP INSURANCE 18887 09/27/99 005026 KOMPAN, INC. SWINGS FOR SOUTH PARK 18888 09/27/99 008445 LITTLE CO OF MARY HOSPI PRISONER EMERGENCY SERVICES 18889 09/27/99 008975 MOBIL FLEET 18890 09/27/99 009754 NANCY NAVARRETTE 18891 09/27/99 009694 PICKENS FUEL CORP GAS CARD PURCHASES/AUG 99 GAS CARD PURCHASES/AUG 99 GAS CARD PURCHASES/AUG 99 GAS CARD PURCHASES/AUG 99 GAS CARD PURCHASES/AUG 99 GAS CARD PURCHASES/AUG 99 GAS CARD PURCHASES/AUG 99 GAS CARD PURCHASES/AUG 99 GAS CARD PURCHASES/AUG 99 GAS CARD PURCHASES/AUG 99 GAS CARD PURCHASES/AUG 99 GAS CARD PURCHASES/AUG 99 CLASS REFUND NATURAL GAS PURCHASE/AUG 99 18892 09/27/99 005379 RICHARDS, WATSON & GERS LEGAL BILLING/JULY 99 LEGAL BILLING/JULY 99 LEGAL BILLING/JULY 99 LEGAL BILLING/JULY 99 LEGAL BILLING/JULY 99 18893 09/27/99 009758 LAUREL ROBERTS 18894 09/27/99 009745 ISABEL RODRIQUEZ 18895 09/27/99 009746 S.C.E.P.I.O.A. RENTAL DEPOSIT REFUND CITATION REFUND/ADMIN HEARING MEMBERSHIP & CONF./WOLCOTT 18896 09/27/99 006875 SAN PEDRO PENINSULA HOS ASSAULT VICTIM EXAM 18897 09/27/99 000839 SUSAN SAXE-CLIFFORD PH PSYCHOLOGICAL EVALUATION 3 ACCOUNT NUMBER 001-4601-4304 001-4202-4304 001-4201-4304 110-1204-4304 001-2101-4304 120-2020 001-4204-4309 105-2601-4309 001-4204-4309 705-1210-4201 001-4202-4309 001-2101-4201 715-2101-4310 715-2201-4310 715-4201-4310 715-4202-4310 715-3302-4310 715-3104-4310 715-4601-4310 715-2601-4310 715-3102-4310 715-4204-4310 001-1250 715-1236 001-2111 715-4204-4310 001-1131-4201 001-1131-4201 001-1131-4201 001-1203-4201 001-1131-4201 001-2111 110-3302 001-2101-4317 001-2101-4201 001-1203-4320 ITEM AMOUNT 78.10 117.27 74.93 31.06 217.86 5,984.00 170.60 86.04 73.42 534.57 608.04 389.50 2,366.34 90.07 106.98 230.73 307.55 181.17 62.75 153.00 64.98 7.97 14.64 137.68 25.00 50.38 6,593.43 249.75 1,303.85 75.62 96.65 50.00 20.00 80.00 250.00 325.00 PAGE 3 CHECK AMOUNT 2,635.40 5,984.00 330.06 534.57 608.04 389.50 3,723.86 25.00 50.38 8,319.30 50.00 20.00 80.00 250.00 325.00 VOUCHRE2 09/27/99 08:22 VOUCHER/ CHECK CHECK NUMBER DATE VENDOR VENDOR NUMBER NAME 18898 09/27/99 007936 GREGORY SEVILLA CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS ITEM DESCRIPTION EDUCATION REIMBURSMENT/FALL 99 18899 09/27/99 009353 SKYHAWKS SPORTS ACADEMY INSTRUCTOR PAYMENT/SUMMER 99 18900 09/27/99 003749 SOIL DANCER 18901 09/27/99 000018 SOUTH BAY WELDERS PLANT PURCHASE/SEPT 99 PLANT PURCHASE/SEPT 99 DEMURRAGE/MAY 99 DEMURRAGE/JUNE 99 18902 09/27/99 008044 STATE TREASURER'S OFFIC REGISTRATION/COPELAND 18903 09/27/99 009743 BRIAN TAYLOR 18904 09/27/99 009153 TOSCO FLEET SERVICES 18905 09/27/99 007052 TSENG & ASSOCIATES 18906 09/27/99 007785 WEST COVINA SERVICES GR 18907 09/27/99 001152 WESTERN CITY MAGAZINE 18908 09/27/99 009750 WESTERN PIZZA ENTERPRIS 18909 09/27/99 001206 ZUMAR INDUSTRIES CITATION REFUND/ADMIN HEARING GAS PURCHASE/AUG 99 AB 939 IMPLEMENTATION ANNUAL MAINT/99/2000 ANNUAL MAINT/99/2000 RECRUITMENT AD/FIRE CHIEF REFUND DUPLICATE PAYMENT SIGNS FOR SKATE TRACK HOURS STREET SIGNS/SEPT 99 TOTAL CHECKS ACCOUNT NUMBER 001-2101-4317 001-4601-4221 001-4202-4309 105-2601-4309 001-2020 001-2020 001-1202-4317 110-3302 715-2201-4310 117-2020 001-2101-4201 001-2201-4201 001-1203-4201 001-3120 001-3104-4309 001-3104-4309 ITEM AMOUNT 655.08 PAGE 4 CHECK AMOUNT 655.08 2,629.60 2,629.60 142.50 142.50 285.00 26.00 24.00 50.00 95.00 95.00 30.00 30.00 593.39 593.39 10,000.00 10,000.00 42,000.00 10,500.00 52,500.00 468.00 468.00 42.99 42.99 77.94 195.80 273.74 308,158.49 VOUCHRE2 09/27/99 08:22 • • CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS FUND TITLE AMOUNT 001 GENERAL FUND 107,361.64 105 LIGHTG/LANDSCAPG DIST FUND 2,853.54 109 DOWNTOWN ENHANCEMENT FUND 7,090.00 110 PARKING FUND 425.08 117 AB939 FUND 10,000.00 120 COUNTY GAS TAX FUND 5,984.00 121 PROP A OPEN SPACE FUND 5,098.72 126 4% UTILITY USERS TAX FUND 46,019.25 705 INSURANCE FUND 17,623.19 715 EQUIPMENT REPLACEMENT FUND 105,703.07 TOTAL 308,158.49 S PAGE 5 • • V0UCHRE2 CITY OF HERMOSA BEACH 09/28/99 14:47 VOUCHER/CHECK REGISTER FOR ALL PERIODS PAGE 1 VOUCHER/ CHECK CHECK VENDOR VENDOR ITEM ACCOUNT ITEM CHECK NUMBER DATE NUMBER NAME DESCRIPTION NUMBER AMOUNT AMOUNT 18910 09/28/99 002822 GARTH GAINES MEALS/POST CLASS 001-2101-4312 120.00 120.00 18911 09/28/99 009761 SHERATON NEWPORT BEACH LODGING/GAINES 001-2101-4312 514.80 514.80 TOTAL CHECKS 634.80 6 VOUCHRE2 09/28/99 14:47 • • CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS FUND TITLE AMOUNT 001 GENERAL FUND 634.80 TOTAL 634.80 PAGE 2 VOUCHRE2 09/30/99 16:50 ---> VOID CHECKS CHECK NUMBERS COMMENTS • • CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS 018928 VOID PAGE 1 VOUCHRE2 09/30/99 16:50 VOUCHER/ CHECK CHECK NUMBER DATE VENDOR NUMBER VENDOR NAME 18912 09/30/99 000029 A-1 COAST RENTALS 18913 09/30/99 000252 BEACH TRAVEL 18914 09/30/99 009104 TRACY BLENDER CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS ITEM DESCRIPTION SANITATION UNITS SERVICED SANITATION UNITS SERVICED SANTITATION UNITS SERVICED AIRFARE/BURRELL AIRFARE/REVICZKY AIRFARE/OAKES/LEAGUE CONF. INSTRUCTOR PAYMENT/SUMMER 99 18915 09/30/99 000016 CALIFORNIA WATER SERVIC WATER WATER WATER WATER WATER WATER WATER WATER WATER WATER WATER BILLING/AUG 99 BILLING/JULY 99 BILLING/SEPT 99 BILLING/AUG 99 BILLING/JULY 99 BILLING/SEPT 99 BILLING/SEPT 99 BILLING/AUG 99 BILLING/SEPT 99 BILLING/SEPT 99 BILLING/SEPT 99 18916 09/30/99 009766 CHABAD JEWISH COMMUNITY RENTAL DEPOSIT REFUND 18917 09/30/99 000153 CINTAS CORPORATION 18918 09/30/99 009110 CONCEPT MARINE 18919 09/30/99 006057 THE CORE GROUP 18920 09/30/99 007627 JIM CUBBERLY 18921 09/30/99 000850 L. N. CURTIS UNIFORM RENTAL/AUG 99 UNIFORM RENTAL/AUG 99 UNIFORM RENTAL/AUG 99 UNIFORM RENTAL/AUG 99 UNIFORM RENTAL/AUG 99 UNIFORM RENTAL/AUG 99 UNIFORM RENTAL/SEPT 99 UNIFORM RENTAL/SEPT 99 PIER RETROFIT PHASE II 40 HOUR SUPPORT BLOCK INSTRUCTOR PAYMEN/SUMMER 99 MOUNTING EQUIPMENT 18922 09/30/99 003673 DEPARTMENT OF THE CORON AUTOPSY REPORTS 18923 09/30/99 000147 THE DEVELOPMENT 18924 09/30/99 009633 JENNIFER ESPARZA 18925 09/30/99 009762 GE CAPITAL 18926 09/30/99 001340 GTE FILM DEVELOPMENT/SEPT 99 CITATION REFUND NETWORK HUB & 3YR WARRANTY EQUIP RENTAL/8/22-9/22/99 9 ACCOUNT NUMBER 160-2020 160-2020 160-3102-4201 001-1201-4317 001-1101-4317 001-1101-4317 001-4601-4221 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 105-2601-4303 001-4202-4303 001-4204-4303 001-2111 ITEM AMOUNT 1,504.68 1,464.95 1,464.97 100.50 12.50 116.50 1,673.00 715.78 611.37 578.01 1,069.26 744.33 1,410.22 408.18 568.25 1,013.22 5,747.02 674.17 500.00 PAGE 2 CHECK AMOUNT 4,434.60 229.50 1,673.00 13,539.81 500.00 001-4202-4187 130.23 110-3302-4187 5.12 001-4202-4187 94.03 110-3302-4187 5.12 001-4202-4187 88.40 110-3302-4187 5.12 001-4202-4187 90.60 110-3302-4187 5.12 423.74 121-8621-4201 7,747.89 7,747.89 001-2020 3,400.00 3,400.00 001-4601-4221 1,050.00 1,050.00 715-2201-4311 413.14 413.14 001-2101-4251 186.00 186.00 001-2101-4305 50.79 50.79 110-3302 30.00 30.00 715-1206-5401 118.33 118.33 001-2101-4309 51.56 51.56 VOUCHRE2 09/30/99 16:50 CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS PAGE 3 VOUCHER/ CHECK CHECK VENDOR VENDOR ITEM ACCOUNT ITEM CHECK NUMBER DATE NUMBER NAME DESCRIPTION NUMBER AMOUNT AMOUNT 18927 09/30/99 000015 GTE CALIFORNIA, INCORPO PHONE BILLING/AUG 99 001-4204-4321 42.67 PHONE BILLING/AUG 99 001-2101-4304 61.09 PHONE BILLING/SEPT 99 715-1206-4304 259.20 PHONE BILLING/SEPT 99 110-3302-4304 65.23 PHONE BILLING/SEPT 99 001-2101-4304 1,432.44 PHONE BILLING/SEPT 99 001-4204-4321 54.30 PHONE BILLING/SEPT 99 001-2201-4304 217.64 PHONE BILLING/SEPT 99 001-4601-4304 87.51 PHONE BILLING/SEPT 99 001-4202-4304 124.73 PHONE BILLING/SEPT 99 001-4201-4304 72.74 PHONE BILLING/SEPT 99 110-1204-4304 33.59 PHONE BILLING/AUG 99 001-1121-4304 5.33 PHONE BILLING/AUG 99 001-1131-4304 1.33 PHONE BILLING/AUG 99 001-1132-4304 2.67 PHONE BILLING/AUG 99 001-1141-4304 21.33 PHONE BILLING/AUG 99 001-1201-4304 22.66 PHONE BILLING/AUG 99 001-1202-4304 51.98 PHONE BILLING/AUG 99 001-1203-4304 33.32 PHONE BILLING/AUG 99 715-1206-4304 34.65 PHONE BILLING/AUG 99 001-1208-4304 2.67 PHONE BILLING/AUG 99 001-2101-4304 402.53 PHONE BILLING/AUG 99 001-2201-4304 170.61 PHONE BILLING/AUG 99 001-4101-4304 23.99 PHONE BILLING/AUG 99 001-4201-4304 38.65 PHONE BILLING/AUG 99 001-4202-4304 269.24 PHONE BILLING/AUG 99 001-4601-4304 153.28 PHONE BILLING/AUG 99 110-1204-4304 26.66 PHONE BILLING/AUG 99 110-3302-4304 71.98 PHONE BILLING/AUG 99 001-4601-4304 83.47 PHONE BILLING/SEPT 99 001-1121-4304 9.11 PHONE BILLING/SEPT 99 001-1131-4304 2.28 PHONE BILLING/SEPT 99 001-1132-4304 4.56 PHONE BILLING/SEPT 99 001-1141-4304 36.45 PHONE BILLING/SEPT 99 001-1201-4304 38.73 PHONE BILLING/SEPT 99 001-1202-4304 88.84 PHONE BILLING/SEPT 99 001-1203-4304 56.96 PHONE BILLING/SEPT 99 715-1206-4304 59.24 PHONE BILLING/SEPT 99 001-1208-4304 4.56 PHONE BILLING/SEPT 99 001-2101-4304 688.05 PHONE BILLING/SEPT 99 001-2201-4304 291.62 PHONE BILLING/SEPT 99 001-4101-4304 41.01 PHONE BILLING/SEPT 99 001-4201-4304 66.07 PHONE BILLING/SEPT 99 001-4202-4304 460.22 PHONE BILLING/SEPT 99 001-4601-4304 262.00 PHONE BILLING/SEPT 99 110-1204-4304 45.57 PHONE BILLING/SEPT 99 110-3302-4304 123.03 PHONE BILLING/AUG 99 001-1121-4304 9.05 PHONE BILLING/AUG 99 001-1131-4304 2.26 PHONE BILLING/AUG 99 001-1132-4304 4.53 PHONE BILLING/AUG 99 001-1141-4304 36.21 PHONE BILLING/AUG 99 001-1201-4304 38.47 l0 VOUCHRE2 09/30/99 16:50 VOUCHER/ CHECK CHECK NUMBER DATE VENDOR VENDOR NUMBER NAME • • CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS ITEM DESCRIPTION PHONE PHONE PHONE PHONE PHONE PHONE PHONE PHONE PHONE PHONE PHONE PHONE PHONE BILLING/AUG 99 BILLING/AUG 99 BILLING/AUG 99 BILLING/AUG 99 BILLING/AUG 99 BILLING/AUG 99 BILLING/AUG 99 BILLING/AUG 99 BILLING/AUG 99 BILLING/AUG 99 BILLING/AUG 99 BILLING/AUG 99 BILLING/SEPT 99 18929 09/30/99 008576 HEC RAMSEY ENTERPRISES DOG LICENSES RENEWAL POSTCARDS 18930 09/30/99 003410 HYATT REGENCY LODGING/BURRELL/LEAGUE CONF. LODGING/REVICZKY/LEAGUE CONF. LODGING/OAKES/LEAGUE CONF. 18931 09/30/99 001484 INDEPENDENT CITIES RISK 99/2000 TULIP PREMIUM DEPOSIT 18932 09/30/99 005358 KUSTOM SIGNALS LASER GUN/BATTERY/CHARGER 18933 09/30/99 007859 L.A. CO METRO TRANS AUT BUS PASS SALES/SEPT 99 18934 09/30/99 009764 L.A. FIRE CHIEFS ASSOCI 99/2000 MEMBERSHIP DUES 18935 09/30/99 009763 L.A.U.S.D. PERSONNEL CO I BILINGUALTESTINO/RICO 18936 09/30/99 000167 LEARNED LUMBER SILICA SAND/WINDMILL LUMBER PURCHASE/SEPT 99 18937 09/30/99 009059 YOLANTA M. LEONAKIS INSTRUCTOR PAYMENT 18938 09/30/99 002175 LIEBERT, CASSIDY & FRIE LEGAL SERVICES/AUGUST 99 18939 09/30/99 008445 LITTLE CO OF MARY HOSPI PRISONER LAB TEST 18940 09/30/99 008431 MICHELE LUBY EDUCATION REIMBURSEMENT 18941 09/30/99 000183 CITY OF MANHATTAN BEACH MEDIAN MAINT/JAN 99 -JUNE 99 18942 09/30/99 000522 KIM MITCHELL 18943 09/30/99 004142 OFFICE DEPOT 18944 09/30/99 009765 ROBERT ORLANDO ADVANCED DISABILITY/SEPT 99 OFFICE SUPPLIES/AUG 99 CLASS REFUND 18945 09/30/99 002487 PAGING NETWORK OF ORANG PAGING SERVICE/JULY 99 PAGING SERVICE/JULY 99 11 ACCOUNT NUMBER 001-1202-4304 001-1203-4304 715-1206-4304 001-1208-4304 001-2101-4304 001-2201-4304 001-4101-4304 001-4201-4304 001-4202-4304 001-4601-4304 110-1204-4304 110-3302-4304 001-2101-4304 110-1204-4305 001-1201-4317 001-1101-4317 001-1101-4317 705-1210-4201 153-2106-5402 145-3403-4251 001-2201-4315 001-1203-4201 001-2125 001-2201-4309 001-4601-4221 001-1203-4201 001-2101-4201 001-2101-4317 105-2020 001-2101-4180 001-4601-4305 001-2111 001-2101-4201 001-2201-4201 ITEM AMOUNT 88.28 56.58 58.84 4.53 683.45 289.68 40.74 65.63 457.14 260.26 45.23 122.21 217.86 285.47 478.50 478.50 579.70 534.57 1,628.50 184.00 175.00 29.00 41.15 205.90 50.40 2,678.80 878.00 1,044.50 459.87 2,103.00 43.17 100.00 78.74 2.25 PAGE 4 CHECK AMOUNT 8,626.74 285.47 - 1,536.70 534.57 1,628.50 184.00 175.00 29.00 247.05 50.40 2,678.80 878.00 1,044.50 459.87 2,103.00 43.17 100.00 VOUCHRE2 09/30/99 16:50 VOUCHER/ CHECK CHECK NUMBER DATE VENDOR NUMBER VENDOR NAME 18946 09/30/99 007541 LOUISE PALERMO 18947 09/30/99 009734 PAVEMENT COATING CO. 18948 09/30/99 18949 09/30/99 18950 09/30/99 18951 09/30/99 18952 09/30/99 18953 09/30/99 18954 09/30/99 18955 09/30/99 18956 09/30/99 18957 09/30/99 18958 09/30/99 008482 009356 009767 009747 001420 PROMEDIX.COM QUALITY SILKSCREEN PEDRO RICO ROSS EQUIPMENT INC DOROTHY SCHEID 003505 SHORELINE PRINTING 009656 SHRED IT CALIFORNIA 000114 SMART & FINAL IRIS COMP 008812 SOUTH BAY REGIONAL PUBL 000159 SOUTHERN CALIFORNIA EDI 000170 SOUTHERN CALIFORNIA GAS CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS ITEM DESCRIPTION PAGING SERVICE/JULY 99 PAGING SERVICE/JULY 99 PAGING SERVICE/JULY 99 PAGING SERVICE/JULY 99 PAGING SERVICE/JULY 99 PAGING SERVICE/SEPT 99 PAGING SERVICE/SEPT 99 PAGING SERVICE/SEPT 99 PAGING SERVICE/SEPT 99 PAGING SERVICE/SEPT 99 PAGING SERVICE/SEPT 99 PAGING SERVICE/SEPT 99 INSTRUCTOR PAYMENT/FALL 99 STREET REHABILITATION PROJECT STREET REHABILITATION PROJECT STREET REHABILITATION PROJECT MEDICAL SUPPLIES/FIRE DEPT HOCKEY LEAGUE AWARD T-SHIRTS REIMBURSEMENT/EXAMINATION FEE SOLID STATE FLASHER MILEAGE REIMBURSE/POST CLASS PAYROLL STATUS FORMS DESTRUCTION SERVICES/SEPT 99 CLEANING SUPPLIES/FIRE DEPT INSTALL ALARM SYSTEM/TAHOE ELECTRIC BILLING/SEPT 99 ELECTRIC BILLING/SEPT 99 ELECTRIC BILLING/SEPT 99 ELECTRIC BILLING/SEPT 99 GAS GAS GAS GAS GAS GAS GAS GAS GAS BILLING/SEPT 99 BILLING/AUG 99 BILLING/SEPT 99 BILLING/AUG 99 BILLING/JULY 99 BILLING/JULY 99 BILLING/SEPT 99 BILLING/AUG 99 BILLING/AUG 99 ACCOUNT NUMBER 001-1201-4201 110-3302-4201 001-4601-4201 001-4202-4201 715-1206-4201 001-2101-4201 001-2201-4201 001-1201-4201 110-3302-4201 001-4601-4201 001-4202-4201 715-1206-4201 001-4601-4221 301-8141-4201 120-8141-4201 120-8141-4201 001-2201-4309 001-4601-4308 001-4201-4317 715-2201-4311 001-2101-4312 001-1203-4305 001-2101-4305 001-4204-4309 715-2101-4311 001-3104-4303 001-4202-4303 001-4202-4303 001-4202-4303 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 ITEM AMOUNT 2.50 2.50 17.25 50.25 2.50 76.22 2.25 2.50 2.50 17.25 50.25 2.50 1,064.00 11,929.98 62,632.36 258.72 300.84 126.00 170.00 64.05 181.22 102.84 90.00 160.50 203.25 10.88 12.77 401.93 19.87 35.66 38.50 102.76 93.61 94.73 49.47 54.96 49.46 148.48 PAGE 5 CHECK AMOUNT 309.46 1,064.00 74,821.06 300.84 126.00 170.00 64.05 181.22 102.84 90.00 160.50 203.25 445.45 VOUCHRE2 09/30/99 16:50 VOUCHER/ CHECK CHECK NUMBER DATE VENDOR VENDOR NUMBER NAME 18959 09/30/99 009686 RICH STILLINGER CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS ITEM DESCRIPTION GAS BILLING/SEPT 99 GAS BILLING/AUG 99 GAS BILLING/JULY 99 GAS BILLING/SEPT 99 GAS BILLING/JULY 99 INSTRUCTOR PAYMENT/SUMMER 99 18960 09/30/99 008346 STRUCTURAL INSPECTION INSPECTION SERVICES/JULY/AUG INSPECTION SERVICES/AUG 99 18961 09/30/99 009769 SUPERIOR ELECTRICAL ADV 50% DEPOSIT FOR MARQUEE 18962 09/30/99 006774 JOSH TRIGUEROS 18963 09/30/99 009374 U.S. ARMOR INSTRUCTOR PAYMENT TACTICAL VESTS PURCHASE 18964 09/30/99 007864 UNION BANK OF CALIFORNI SAFEKEEPING FEE/AUG 99 18965 09/30/99 003353 VISA fJTERVIEW/PLANNING COMM LEAGUE REGISTRATION/COUNCIL LEAGUE REGISTRATION/BURRELI. 18966 09/30/99 005758 WILSON & ASSOCIATES POLYGRAPH EXAMINATIONS/POLICE 18967 09/30/99 009234 ZEP MANUFACTURING COMPA 55 GALLONS ASPHALT RELEASE TOTAL CHECKS 13 ACCOUNT NUMBER 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 001-4204-4303 001-4601-4221 121-8624-4201 121-8624-4201 125-8627-5602 001-4601-4221 153-2106-5402 001-1141-4201 001-1101-4317 001-1101-4317 001-1201-4317 001-2101-4201 001-3104-4309 PAGE 6 ITEM CHECK AMOUNT AMOUNT 74.81 39.23 19.64 57.55 19.64 878.50 189.00 189.00 1,649.00 204.00 1,853.00 7,804.00 7,804.00 189.00 189.00 3,734.63 3,734.63 208.33 208.33 14.77 590.00 295.00 899.77 150.00 150.00 868.35 868.35 149,266.38 • VOUCHRE2 09/30/99 16:50 CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS FUND TITLE AMOUNT 001 GENERAL FUND 42,960.89 105 LIGHTG/LANDSCAPG DIST FUND 1,473.09 110 PARKING FUND 874.45 120 COUNTY GAS TAX FUND 62,891.08 121 PROP A OPEN SPACE FUND 9,600.89 125 PARK/REC FACILITY TAX FUND 7,804.00 145 PROPOSITION 'A FUND 184.00 153 SUPP LAW ENF SERV (SLESF) 5,363.13 160 SEWER FUND 4,434.60 301 CAPITAL IMPROVEMENT FUND 11,929.98 705 INSURANCE FUND 534.57 715 EQUIPMENT REPLACEMENT FUND 1,215.70 TOTAL 149,266.38 PAGE 7 • VOUCHRE2 CITY OF HERMOSA BEACH 10/05/99 08:10 VOUCHER/CHECK REGISTER FOR ALL PERIODS ---> VOID CHECKS CHECK NUMBERS COMMENTS 018970 VOID 15 PAGE 1 VOUCHRE2 10/05/99 08:10 VOUCHER/ CHECK CHECK NUMBER DATE VENDOR NUMBER VENDOR NAME 18968 10/05/99 005621 STEPHEN R. BURRELL 18969 10/05/99 000243 CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS ITEM DESCRIPTION PER DIEM/LEAGUE OF CA CITIES HERMOSA BEACH PAYROLL A PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 PAYROLL/9-16 18971 10/05/99 004186 LEAGUE OF CA CITIES/LA 18972 10/05/99 005549 JULIA A. OAKES 18973 10/05/99 005551 J.R. REVICZKY 18974 10/05/99 008583 HAROLD C WILLIAMS TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 TO 9-30-99 REGISTRATION/J.R. REVICZKY REGISTRATION/JULIE OAKES PER DIEM/LEAGUE OF CA CITIES PER DIEM/LEAGUE OF CA CITIES PER DIEM/LEAGUE OF CA CITIES ACCOUNT ITEM NUMBER AMOUNT 001-1201-4317 200.00 001-1103 322,122.51 105-1103 9,047.29 109-1103 944.06 110-1103 33,848.83 115-1103 .08 117-1103 713.49 121-1103 617.42 125-1103 374.19 126-1103 94.41 140-1103 498.42 145-1103 1,515.71 146-1103 825.92 150-1103 873.63 152-1103 .33 160-1103 9,392.34 180-1103 483.89 301-1103 .24 705-1103 2,662.02 715-1103 5,755.98 001-1101-4317 27.00 001-1101-4317 27.00 001-1101-4317 001-1101-4317 001-4202-4317 190.00 190.00 150.00 PAGE 2 CHECK AMOUNT 200.00 389,770.76 54.00 190.00 190.00 150.00 TOTAL CHECKS 390,554.76 VOUCHRE2 10/05/99 08:10 • • CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS FUND TITLE AMOUNT 001 GENERAL FUND 322,906.51 105 LIGHTG/LANDSCAPG DIST FUND 9,047.29 109 DOWNTOWN ENHANCEMENT FUND 944.06 110 PARKING FUND 33,848.83 115 STATE GAS TAX FUND .08 117 AB939 FUND 713.49 121 PROP A OPEN SPACE FUND 617.42 125 PARK/REC FACILITY TAX FUND 374.19 126 4% UTILITY USERS TAX FUND 94.41 140 COMMUNITY DEV BLOCK GRANT 498.42 145 PROPOSITION 'A FUND 1,515.71 146 PROPOSITION 'C FUND 825.92 150 GRANTS FUND 873.63 152 AIR QUALITY MGMT DIST FUND .33 160 SEWER FUND 9,392.34 180 FIRE PROTECTION FUND 483.89 301 CAPITAL IMPROVEMENT FUND .24 705 INSURANCE FUND 2,662.02 715 EQUIPMENT REPLACEMENT FUND 5,755.98 TOTAL 390,554.76 I1 PAGE 3 VOUCHRE2 10/05/99 08:10 • • CITY OF HERMOSA BEACH VOUCHER/CHECK REGISTER FOR ALL PERIODS CLAIMS VOUCHER APPROVAL I HEREBY CERTIFY TpAT THE "ANDS OR CLAIMS COVERED BY THE CHECKS LISTED 0 PAGES l TO //INCLUSIVE, OF THE VOUCHER REGISTER FOR 1P7- /0/5/97 ARE ACCURATE, FUNDS ARE AVAILABLE FOR PAYMENT, AND ARE IN CONFORMANCE TO THE BUDGET. BY ��OJ FINA CE /DIRECTOR DATE %�( PAGE 4 October 5, 1999 Honorable Mayor and For the Meeting of Members of the City Council October 12, 1999 CANCELLATION OF CHECKS Please consider the following request for cancellation of the checks listed below: #18173 — 07/22/99 - $ 30.00 Jennifer Soto. Check was made to the wrong vendor. Check was never mailed. #18495 — 08/19/99 - $ 1,059.00 Premiere Heure. Check was lost in the mail. #18716 — 09/09/99 - $ 395.00 Evidence Photographers. Employee not attending. Check was never mailed. #18886 — 09/27/99 - $ 534.57 Independent Cities Association. Check was made to the wrong vendor. Check was never mailed. Concur: Stephen R. Burrell, City Manager lJo n M. Workman, City Trea 61. 1 • VVOT Noted for fiscal impact: Viki Copeland, Finance Director October 7, 1999 • Honorable Mayor and Members of the Hermosa Beach City Council • RAF /0;12-9? Regular Meeting of October 12, 1999 TENTATIVE FUTURE AGENDA ITEMS OV MBBB 211999 Recommendation to receive and file action minutes from the Parks, Recreation and Community Resources Advisory Commission meeting of November 2, 1999 Community Resources Director Recommendation to receive and file action minutes from the Planning Commission meeting of November 16, 1999 Community Development Director Monthly Activity Reports for October, 1999 All Departments 1 c NOVEMBER Public Hearing: Parking structure retail building ground lease agreement Community Development Director Ordinance amending miscellaneous sections of the Hermosa Beach Municipal Code City Attorney Recommendation to receive and file action minutes from the Parks, Recreation and Community Resources Advisory Commission meeting of October 5, 1999 Community Resources Director Recommendation to receive and file action minutes from the Planning Commission meeting of October 19, 1999 Community Development Director Public Hearing: Appeal to the Hermosa Beach City Council of the Planning Commission denial of a conditional use permit amendment to allow on -sale alcohol in conjunction with an existing restaurant and to add a dancing area and live entertainment, and adoption of an environmental negative declaration at 1100 The Strand, "Scotty's". (Continued from June 22, 1999 & September 14, 1999 meetings). Community Development Director Monthly Activity Reports for September, 1999 All Departments OV MBBB 211999 Recommendation to receive and file action minutes from the Parks, Recreation and Community Resources Advisory Commission meeting of November 2, 1999 Community Resources Director Recommendation to receive and file action minutes from the Planning Commission meeting of November 16, 1999 Community Development Director Monthly Activity Reports for October, 1999 All Departments 1 c NOVEMBER Recommendation to approve City Council meeting schedule for 2000. City Manager OV MBBB 211999 Recommendation to receive and file action minutes from the Parks, Recreation and Community Resources Advisory Commission meeting of November 2, 1999 Community Resources Director Recommendation to receive and file action minutes from the Planning Commission meeting of November 16, 1999 Community Development Director Monthly Activity Reports for October, 1999 All Departments 1 c • Honorable Mayor and Members of the Hermosa Beach City Council j4F 10-(2_7 October 7, 1999 Regular Meeting of October 12, 1999 REVENUE AND EXPENDITURE REPORTS AUGUST 1999 Revenue and Expenditure reports for the month of August 1999 are not yet available due to the audit of fiscal year ending June 30, 1999. This report will be included with your agenda packets as soon as they are available. NOTED: Stephe4R(Burrell, City Manager Respectfully submitted, Viki Copeland Finance Director ld h:\b95\open\revexpdec.doc • etc 10-12-97 October 5, 1999 Honorable Mayor and Members For the City Council Meeting of the City Council of October 12, 1999 ACCEPTANCE OF DONATIONS Recommended Action: It is recommended that the City Council accept the following donations given to the Community Resources department and to the Police department. Round Table Pizza - $250.00 Tony Maroni's Famous Gourmet Pizza - $150.00 Dee Strange - $25.00 Background: In September, 1999, the City received donations in the amount of $250.00 and $150.00 to be used for the roller hockey program, and in the amount of $25.00 to be used for the D.A. R. E. program. Re-pectfully submitted: Valerie Mohler Accounting Supervisor h: user\valerie\donation.doc Concur: (4.4-,:- Viki Copeland Finance Director ►� ff!phen Burrell City Manager r Honorable Mayor and Members of the Hermosa Beach City Council • 4-I ,/' � 0 2-- 99' September 29, 1999 Regular Meeting of October 12, 1999 CIP PROJECTS 96-153 TRAFFIC SIGNAL AT HERMOSA AVE. & 14TH ST. AND 96-156 TRAFFIC SIGNAL AT HERMOSA AVE. & 13TH ST. - AWARD OF CONSTRUCTION CONTRACT Recommendation: It is recommended that the City Council: 1. Authorize the award of Traffic Signal Improvements to Inspection Engineering Construction of Costa Mesa in the amount of $164,759; 2. Authorize the Mayor to execute and the City Clerk to attest the Construction Contract subject to approval of the City Attorney; and 3. Authorize the Director of Public Works to issue change orders as necessary not to exceed $16,476. Background: On June 8, 1999, City Council approved the budget for fiscal year 1999-2000, which included Traffic Signal Improvements at the intersection of 13th and 14th Street on Hermosa Avenue. After preparation of plans and specifications, the project was advertised for three weeks in the Easy Reader, Green Sheet (Construction News Reporter) and Daily Construction Service. A total of seven bid packages were purchased. The City Clerk received seven bids by the closing date of September 23, 1999. The bids were publicly opened and read aloud. The bid results are as follows: COMPANY CITY BID AMOUNT Inspection Engineering Construction Costa Mesa 164,759 Steiny & Company Baldwin Park 169,775 L. A. Signal City of Industry 169,800 B. A. Construction Anaheim 176,102 C.T. & F., Inc. Bell Gardens 184,023 Transtech Engineers, Inc. Walnut 189,206 TDS Engineering Westlake Village 202,805 The low bidder is 7.5% below the Engineer's estimate of $178,000. The proposed work for this project includes, in general, the complete construction of traffic signal installation and appurtenances, traffic signals, controllers, emergency vehicle preemption, street lights, loops, signs, striping and civil improvements. if • • Analysis: A reference check revealed that Inspection Engineering Construction has an excellent reputation for their performance and work with previous clients. The Department of Public Works, therefore, recommends award of this contract to Inspection Engineering Construction in the amount of $164,759. The bid proposals are in the Public Works/City Engineer's office for review. Fiscal Impact: The amount budgeted for the CIP Projects 96-153 and 96-156 Traffic Signal Improvements in the 1999-2000 Fiscal Year budget is $228,554. This project is funded by a combination of State Gas Tax Fund and the City Street Lighting Fund. Respectfully submitted, Concur: Homayoun Behboodi Associate Engineer Noted For Fiscal Impact: Viki Copeland Finance Director / arold C. Williams, P.E. Director of Public Works/City Engineer Steph City Manager 2 F/B95/pwfiles/ccitems/96-153 & 96-156 award contract HONORABLE MAYOR and MEMBERS of the HERMOSA BEACH CITY COUNCIL Hx30 10 -12-97 October 4, 1999 Regular Meeting of October 12, 1999 SUBJECT: FINAL MAP #25093 (C.U.P. CON NO. 98-8, PDP NO. 98-9) LOCATION: 1646-48 LOMA DRIVE APPLICANT(S): MICHAEL MULLIGAN REQUEST: TO ADOPT A RESOLUTION APPROVING FINAL MAP FOR A TWO -UNIT CONDOMINIUM PROJECT Recommendation Staff recommends approval of Final Parcel Map #25093 which is consistent with the approved Vesting Tentative Parcel Map, and recommends the City Clerk be directed to endorse the certificate for said map. Background The Planning Commission approved a Conditional Use Permit for a two -unit condominium project and Vesting Tentative Parcel Map #25093 at their May 19, 1998 meeting. The project is currently under construction. Process Once a map has been tentatively approved by the Planning Commission, copies of the tentatively approved map must be submitted to the L.A. County Engineer, who is contracted by the City, to review the map for its technical correctness (pursuant to Section 66442(a)(4) of the Subdivision Map Act). An applicant has two years from the date of tentative map approval to submit for final map approval. Typically applicants have not submitted for final map approval until projects are near completion and ready to be sold. Final maps must be submitted to the City Council and must be approved by the City Council, "...if it conforms to all the requirements of [Subdivision Map Act] and any local subdivision ordinance applicable at the time of approval or conditional approval of the tentative map and any rulings made thereunder...." pursuant to Section 66458(a) of the Subdivision Map Act. ig • • Analysis The staff has reviewed the Final Map and found it substantially consistent with the Vesting Tentative Parcel Map approved by the Planning Commission and in conformance with the State Subdivision Map Act. CONCUR: Sol Blumenf ld, 'rector Community evelopment Department Z Respectfully submitted, oberrson Associate Planner y/f:fm 1646 1 RESOLUTION NO. 99- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH, CALIFORNIA, GRANTING APPROVAL OF FINAL PARCEL MAP #25093 FOR A TWO UNIT CONDOMINIUM PROJECT LOCATED AT 1646-48 LOMA DRIVE, HERMOSA BEACH, CALIFORNIA. WHEREAS, the City Council held a meeting on October 12, 1999 and made the following Findings: A. This project will not violate any of the provisions of Sections 66427.1, 66474, 66474.1, and 66474.6 of the Subdivision Map Act; B. The proposed subdivision, together with the provisions for its design and improvement, is consistent with the General Plan required by Article 5 (commencing with Section 65300) of Chapter 3 of Division 1 of the Government Code, or any specific plan adopted pursuant to Article 8 (commencing with Section 65450) of Chapter 3 of Division 1 of the Government Code; C. The development of the property in the manner set forth on the subject division of land will not unreasonably interfere with the free and complete exercise of any public entity and/or public utility rights-of-way and/or easements within the subject division of land; D. The approval of said map is subject to all conditions outlined in Planning Commission Resolution P.C. No. 98-27 adopted after hearing on May 19, 1998; E. This project is Categorically Exempt pursuant to 15268(b)(3), "Approval of final subdivision maps", of the California Environmental Quality Act. NOW, THEREFORE, the City Council of the City of Hermosa Beach, California, does hereby resolve as follows: 1. Pursuant to the recommendation of the Planning Commission and to the recommendation of the County Engineer, the City Council does hereby grant final approval of Parcel Map #25093 in the City of Hermosa Beach, State of California, being a Subdivision of Lot 2, Hiss' Addition to Hermosa Beach, as recorded in Book 4, Page 19 of Maps in the Office of the Recorder of Los Angeles County, for a two -unit condominium project on land commonly known as 1646-48 Loma Drive, Hermosa Beach, California. PASSED, APPROVED, and ADOPTED this 12th day of October, 1999. PRESIDENT of the City Council and Mayor of the City of Hermosa Beach, California ATTEST: APPROVED AS TO FORM: CITY CLERK CITY ATTORNEY f:fm1646rs • Dae• September 30, 1999 Honorable Mayor and Members of Regular Meeting of the Hermosa Beach City Council October 12, 1999 CIP 96-624 NORTH PIER PARKING STRUCTURE - RESCIND THE AWARD MADE TO BFL/OWEN, INC. AND APPROVE CHANGE ORDER TO GORDON H. CHONG & PARTNERS Recommendation: It is recommended that the City Council rescind the award made to BFL/Owen, Inc. and authorize staff to issue a Change Order to Gordon H. Chong & Partners. Background: On February 23, 1999, the City Council authorized staff to retain BFL/Owen, Inc. in order to provide structural observation of the parking structure construction in the amount of $25,000. BFL/Owen, Inc. is the Structural Engineer and a principal on the Gordon H. Chong & Partners Design Team for the parking structure. Analysis: Staff inadvertently requested to hire BFL/Owen, Inc., a sub -consultant of Gordon H. Chong & Partners, for the structural observation of the parking structure. Since Gordon H. Chong & Partners is the primary design consultant for this project, and BFL/Owen, Inc. is a sub -consultant, hiring, billing and payment should be processed through the primary — Gordon H. Chong & Partners. Therefore, staff recommends rescinding the award made to BFL/Owen, Inc. and approving a Change Order to Gordon H. Chong & Partners in the authorized amount of $25,000 to pay BFL/Owen, Inc. for structural observation. 1h Fiscal Impact: No additional appropriations are required. Respectfully submitted, H /3c /74.....-0- Homayct in Behboodi Associate Engineer Noted for Fiscal Impact: eLizet#0,44 Viki Copeland Finance Director Concur: • a GJ di - Harold C. Williams, P.E. Director of Public Works/City Engineer Steph=G R.urrell City M.nager 2 F/B95/pwfiles/ccitems/96-624 parking structure • (Pf Rx, 10-12 - ctober 6, 1999 Honorable Mayor and Members of Regular Meeting of The Hermosa Beach City Council October 12, 1999 RECOMMENDATION TO DENY CLAIMS Recommendation: It is recommended that City Council deny the following claims and refer them to the City's Liability Claims Administrator: 1. Claimant .• Brooks, Jeffrey A. Date of Loss . 08-30-99 Date Filed: : 09-21-99 Allegation: : Overspray on car by painting of limit lines 2. Claimant . USAA as Subrogee of Erik Armstrong Date of Loss : 05-30-99 Date Filed: : 10-05-99 Allegation: : Vehicle damage due to obstructed view of stop sign 3. Claimant : Plenge, Wendi Brunell Date of Loss : 08-11-99 Date Filed : 09-30-99 Allegation : Tire damaged by storm drain cover A copy of these claims are on file with the City Clerk's office. Respectfully Submitted, Micy(ael A. Earl, Directo Concur: Stephen R. :urrell Psonnel & Risk Management City Manager li October 4, 1999 Honorable Mayor and Members of Regular Meeting of The Hermosa Beach City Council October 12, 1999 CIP PROJECT 98-621 PHASE III MUNICIPAL PIER ARCHITECTURAL UPGRADES — AWARD OF PROFESSIONAL SERVICES AGREEMENT FOR DESIGN Recommendation: It is recommended that the City Council: 1. Award the design contract for CIP Project 98-621 Phase III Municipal Pier . Architectural Upgrades to Purkiss Rose — RSI of Fullerton, California for a fee of $174,500. 2. Authorize the Mayor to execute and the City Clerk to attest the attached Professional Services Agreement subject to approval by the City Attorney; and 3. Authorize the Director of Public Works to make changes to the agreement up to $17,450. Summary: On August 10, 1999, Council authorized Staff to enter into negotiation with Purkiss Rose — RSI to develop the final scope of services and design fee for the project, and return to Council with an agreement. Since the City has acquired valuable electronic data as well as other data in connection with the development of the Pier project, Staff negotiated for cost savings in the area of data collection for this phase of the project. Negotiations have been completed with no cost savings being achieved. Background: This project is Phase III of a three-phase project that calls for the renovation of the pier. Phase III will include the plaza, lifeguard facilities and restroom improvements. Phase I, which called for the repair of the pier structure, was completed in May 1999. It is anticipated that Phase II, which consists of deck surface repair work, work related to the installation of a new lighting system and safety railing along the pier, will be completed in February 2000. The 1999-2000 Capital Improvement Project Budget includes funding for the design and construction of these proposed improvements. The services of a consultant architect/engineer are needed to supplement the architectural/engineering capacity of the Public Works office. These services will include the preparation of detailed plans, specifications, cost estimates and other construction documents as required. 1 1j • • Staff sent out more than 50 RFP's to firms Staff felt were qualified and would be interested in the project. Eight firms attended a non -mandatory pre -proposal briefing on July 8, 1999. Proposals were received from the following firms: 1. B.M. Barsoum, Architect Hermosa Beach, CA $100,655 2. Purkiss Rose — RSI Fullerton, CA $174,500 3. On August 3rd the selection committee evaluated each proposal on the basis of the scope of services, similar projects, resumes of key personnel and work schedule. The committee consisted of City Staff members and a member of the County of Los Angeles Lifeguard Department. Proposal Submittal Items: 1. B.M. Barsoum, AIA Weak Weak Ok Hermosa Beach, CA 2. Purkiss Rose — RSI Strong Strong Strong Fullerton, CA After evaluating the above proposal data and presentation, the consulting firm of Purkiss Rose — RSI was chosen by the selection committee to provide the required services. Analysis: Data collection is a time consuming task and was a major cost factor during the project start- up phase. Since the City has acquired valuable electronic data as well as other data in connection with the development to the Pier project, Staff negotiated for cost savings in the area of data collection for this phase of the project. Negotiations have been completed with no savings being achieved. The following is an excerpt from a letter received from Purkiss-Rose that gives a brief explanation why, from a building architectural standpoint, the consultant team cannot use the current plan data: 1. The David Bartlett plans are preliminary CADD drawings for a different scope project and do not have any public restrooms on the upper level. They also indicate a different beach level plan configuration. If the City wants to have the lower plan as indicated on sheet A1.4, it could save us some preliminary time, but not for the construction documents, since there are no details. In addition, the parking layout would have to be re -worked in order to make it functional. 2 • • 2. The demolition plan will help in giving us a base sheet, but we had anticipated receiving this in our original fee proposal. If we are to remodel the exterior of the lifeguard tower, we need as -built plans for it. 3. We also need a copy of the coastal permit with their approved plans so that we can compare the permitted plan with the new building program." In addition: "From an electrical engineering standpoint, the plans were prepared thirty-five years ago and may not be the actual condition now. A thorough site investigation is needed to establish the present electrical site condition. An actual electrical Toad study is necessary to know whether the existing facility has enough capacity for the proposed additional Toads or whether the existing service needs to be upgraded." Further: "The other plans reflect an alternate design concept for the Pier Plaza area. Most of the drawings in this set of plans deal more with architectural and structural features of that particular design concept. However, there is one drawing that shows the existing utilities and Pier Plaza layout that may be of some use to our work. This base sheet would at the most save us some drafting and compilation of existing data. The problem is we either assume this data is correct or if we have to check this data for accuracy and completeness it would be the same as doing it ourselves in the first place." In deference to time, Staff concurs with the above and recommends award to Purkiss-Rose RSI so that the project can now move forward without further delay. Fiscal Impact: With a design fee of $174,500 and a contingency for $17,450, the proposed design budget is $191,950. The total FY 99-00 budget for this project is $1,340,441 for design, engineering and construction; therefore no additional appropriation is required. Attachments: Location Map Professional Services Agreement Respectfully submitted, Harold C. Williams, P.E. Director of Public Works/City Engineer 3 Noted for Fiscal Impact: Viki Copeland Finance Director d) • 4 • Concur: City Manager F/B95/pwfiles/ccitems/98-621 Award Design Services Project N CIP 98-621 Municipal ase III Architectural Ui JI O_ S n H HERMOSA cu LL • O •i ier Renovation.' rades Project Location U 7 C) AVE. • l II Project Location Map NTS ATTACHMENT 1 Cr, N • • PROFESSIONAL SERVICES AGREEMENT THIS AGREEMENT, made and entered into this 13th day of October 1999, at Hermosa Beach, County of Los Angeles, State of California, by and between the CITY OF HERMOSA BEACH, through its duly elected, qualified and acting MAYOR, hereinafter called the CITY, and Purkiss•Rose-RSI, hereinafter called the CONSULTANT. WITNESSETH: That the CONSULTANT for and in consideration of the covenants, conditions, agreements, and stipulations of the CITY herein expressed, does hereby agree to furnish to the CITY professional services and materials, as follows: ARTICLE I - Scope of Work CONSULTANT shall perform all work necessary to complete in a manner satisfactory to CITY the services set forth in the plans and specification or the scope of work attached as Exhibit "A". ARTICLE II - Costs The CITY agrees to pay CONSULTANT for all the work or any part of the work performed under this Agreement at the rates and in the manner established in the attached Bid Proposal. Total expenditure made under this contract is for three years and shall not exceed the sum of $174,500. This fee includes all expenses, consisting of all incidental blueprinting, photography, travel, and miscellaneous costs, estimated to be accrued during the life of the contract. It also includes any escalation or inflation factors anticipated. No increase in fees will be allowed during the life of the contract. Any increase in contract amount or scope shall be by express written amendment approved by the CITY and CONSULTANT. The CONSULTANT will be reimbursed for costs incurred in the performance hereof as are allowable under the provisions of Part 1-14 of the Federal Procurement Regulations. 1 • • ARTICLE III - Method of Payment CONSULTANT shall be reimbursed monthly in arrears based upon the hourly services provided. CONSULTANT shall submit invoices in triplicate and addressed to the CITY, do the Finance Department, 1315 Valley Drive, Hermosa Beach, CA 90254-3884. ARTICLE IV - Subcontracting CONSULTANT shall not be permitted to subcontract any portion of this contract without the express written consent of the CITY. ARTICLE V - Completion Date CONSULTANT shall commence work under this agreement upon execution of this Agreement and shall complete the work according to the schedule submitted as part of Exhibit "A", however, the City's Director of Public Works may extend the completion date as required by the scope of this contract. Any contract time extension shall require the express written consent of the Director of Public Works. ARTICLE VI - Accounting Records CONSULTANT must maintain accounting records and other evidence pertaining to costs incurred which records and documents shall be kept available at the CONSULTANT's California office during the contract period and thereafter for three years from the date of final payment of Federal funds hereunder. ARTICLE VII - Ownership of Data All data, maps, photographs, and other material collected or prepared under the contract shall become the property of the CITY. ARTICLE VIII - Termination This contract may be terminated at any time for breach and the CITY may terminate unilaterally and without cause upon seven (7) days written notice to the CONSULTANT. All work satisfactorily performed pursuant to the contract and prior to the date of termination may be claimed for reimbursement. ARTICLE IX - Assignability CONSULTANT shall not assign or transfer interest in this contract without the prior written consent of the CITY. 2 • • ARTICLE X - Amendment It is mutually understood and agreed that no alteration or variation of the terms of this contract, or any subcontract requiring the approval of the CITY, shall be valid unless made in writing, signed by the parties hereto, and approved by all necessary parties. ARTICLE XI - Non -Solicitation Clause The CONSULTANT warrants that he or she has not employed or retained any company or persons, other than a bona fide employee working solely for the CONSULTANT, any fee, commission, percentage, brokerage fee, gifts, or any other consideration, contingent upon or resulting from the award or making of this contract. For breach or violation of this warranty, the CITY shall have the right to annul this contract without liability, or, in its discretion to deduct from the contract price or consideration, or otherwise recover, the full amount of such fee, commission, percentage, brokerage fee, gift, or contingent fee. ARTICLE XII - Equal Opportunity Assurance During the performance of this contract, the CONSULTANT agrees as follows: A. The CONSULTANT will not discriminate against any employee or applicant for employment because of race, sex, creed, color or national origin. The CONSULTANT will take affirmative action to ensure that applicants are employed, and that employees are treated during employment without regard to their race, sex, creed, color or national origin. Such action shall include, but not be limited to the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoffs or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The CONSULTANT agrees to post in conspicuous places, available to employees and applicants for employment, notices setting forth the provisions of this nondiscrimination clause. B. The CONSULTANT will, in all solicitations or advertisements for employees placed by or on behalf of the CONSULTANT, state that all qualified applicants will receive consideration for employment without regard to race, sex, creed, color or national origin. C. The CONSULTANT will permit access to their books, records and accounts by the applicant agency, the State, the Federal Highway Administration and/or the National Highway Traffic Safety Administration for purposes of investigation to ascertain compliance with this nondiscrimination clause. 3 D. In the event of the CONSULTANT's noncompliance with the nondiscrimination clauses of this contract, this contract may be canceled, terminated or suspended in whole or in part. ARTICLE XIII - Clean Air Act During the performance of this Contract, the CONSULTANT agrees to comply with all applicable standards, orders, or regulations issued pursuant to the Clean Air Act of 1970 (42 U.S.C. 1857 et seq.) and the Federal Water Pollution Control Act (33 U.S.C. 1251 et seq.) as amended. ARTICLE XIV - Indemnit CONSULTANT agrees to indemnify the CITY, its officers, employees and agents against, and will hold and save each of them harmless from, any and all actions, claims, damages to persons or property, penalties, obligations or liabilities that may be asserted or claimed by any person, firm, entity, corporation, political subdivision or other organization arising out of the negligent acts or intentional tortious acts, errors or omissions of CONSULTANT, its agents, employees, sub- CONSULTANT's, or invitees, provided for herein. CONSULTANT will defend any action or actions filed in connection with any of said claims, damages, penalties, obligations or liabilities and will pay all costs and expenses, including attorneys' fees incurred in connection herewith. CONSULTANT will promptly pay any judgment rendered against CITY, its officers, agents or employees for any such claims, damages, penalties, obligations or liabilities. In the event CITY, its officers, agents or employees is made a party to any action or proceeding filed or prosecuted against CONSULTANT for such damages or other claims arising out of or in connection with the sole negligence of CONSULTANT hereunder, CONSULTANT agrees to pay CITY, its officers, agents, or employees, any and all costs and expenses incurred by CITY, its officers, agents or employees in such action or proceeding, including but not limited to reasonable attorney's fees. ARTICLE XV - Insurance A. Without limiting CONSULTANT'S obligations arising under ARTICLE XIV - Indemnity, CONSULTANT shall not begin work under this Agreement until it obtains policies of insurance required under this section. The insurance shall cover CONSULTANT, its agents, representatives and employees in connection with the performance of work under this Agreement, and shall be maintained throughout the term of this Agreement. Insurance coverage shall be as follows: 4 • • i. Automobile Liability Insurance with minimum coverage of $1,000,000 for property damage, $1,000,000 for injury to one person/single occurrence, and $2,000,000 for injury to more than one person/single occurrence. ii. Public Liability and Property Damage Insurance, insuring CITY its elected and appointed officers, agents, and employees from claims for damages for personal injury, including death, as well as from claims for property damage which may arise from CONSULTANT'S actions under this Agreement, whether or not done by CONSULTANT or anyone directly or indirectly employed by CONSULTANT. Such insurance shall have a combined single limit of not less than $2,000,000. iii. Worker's Compensation Insurance for all CONSULTANT'S employees to the extent required by the State of California. iv. Professional Liability Insurance to cover or partially cover or partially cover damages that may be the result of errors, omission, or negligent acts of CONSULTANT. Such insurance shall be in an amount of not less than $1,000,000 per occurrence. B. Deductibility Limits for policies referred to in subparagraphs A (i) (ii) and (iii) shall not exceed $5,000 per occurrence. C. Additional Insured. The CITY, its elected and appointed officers, agents, and employees shall be named as additional insureds on policies referred to in subparagraphs A (i) and (ii). D. Primary Insurance The insurance required in paragraphs A (i) (ii) and (iv) shall be primary and not excess coverage. E. Evidence of Insurance CONSULTANT shall furnish CITY, prior to the execution of this Agreement, satisfactory evidence of the insurance required, issued by an insurer authorized to do business in California, and an endorsement to each such policy of insurance evidencing that each carrier is required to give CITY at least 30 days prior written notice of the cancellation of any policy during the effective period of the Agreement. All required insurance policies are subject to approval of the City Attorney. Failure on the part of CONSULTANT to procure or maintain said insurance in full force and effect shall constitute a material breach of this Agreement or procure or renew such insurance, and pay any premiums therefor at CONSULTANT'S expense. 5 ARTICLE XVI - Enforcement of Agreement In the event that legal action is commenced to enforce or declare the rights created under this Agreement, the prevailing party shall be entitled to an award of costs and reasonable attorney's fees in the amount to be determined by the court. ARTICLE XVII - Conflicts of Interest No member of the governing body of the CITY and no other officer, employee, or agent of the CITY who exercises any functions or responsibilities in connection with the planning and carrying out of the program, shall have any personal financial interest, direct or indirect, in this Agreement; and the CONSULTANT further covenants that in the performance of this Agreement, no person having any such interest shall be employed. ARTICLE XVIII - Independent CONSULTANT The CONSULTANT is and shall at all times remain as to the CITY a wholly independent CONSULTANT. Neither the CITY nor any of its agents shall have control over the conduct of the CONSULTANT or any of the CONSULTANT's employees, except as herein set forth. The CONSULTANT shall not at any time or in any manner represent that it or any of its agents or employees are in any manner agents or employees of the CITY. ARTICLE XIX - Entire Agreement of the Parties This Agreement supersedes any and all other agreements, either oral or in writing, between the parties hereto with respect to the employment of CONSULTANT by CITY and contains all the covenants and agreements between the parties with respect such employment in any manner whatsoever. Each party to this Agreement acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which are not embodied herein, and that no other agreement or amendment hereto shall be effective unless executed in writing and signed by both CITY and CONSULTANT. ARTICLE XX - Governing Law This Agreement shall be governed by and construed in accordance with the laws of the State of California, and all applicable federal statutes and regulations as amended. 6 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first above written. CITY OF HERMOSA BEACH CONSULTANT MAYOR: City of Hermosa Beach ATTEST: Elaine Doerfling City Clerk APPROVED AS TO FORM: City Attorney 7 rbp/Gpsa purkiss rose • Municipal Pier Architectural Upgru4Pier-Head, City of Hermosa Beach 3. PROJECT APPROACH a. and b. Description of Approach and Communication with Subconsultants and Project Manager Purkiss Rose -RSI has developed an approach to each project based upon its past involvement working on similar projects using an interdisciplinary Consultant Team. Our approach incorporates four techniques used successfully on previous projects: 1. Extensive coordination with the project manager, City Staff, Consultants, Local Merchants Organizations, Community Committees, and the integration of their expertise and suggestions into the planning process; 2. Multi -agency input and research process to obtain all information, agency review process, submittal and approval process. Complete and thorough research of existing materials and field investigation. Team evaluation and value engineering of everyone's work to assure the best possible project for the budget. 3 Systematic concept development, group critique, and refinement to identify major components of the plans early in the planning process. Staffand Committee meetings to establish consensus on program use, improvements and facilities development. 4. The use ofgraphics to communicate planning and design concepts to community groups and decision makers. Further elaboration of these techniques is provided below. Coordination with City Staff, Consultants, Merchant and Community Committees The Consultant Team, led by the project manager is familiar with community planning projects. We have found that team work and close coordination among staff, consultants, and public agencies are essential to a successful project. We recognize that the Consultant Team will be responsible for ensuring that a high degree of coordination occurs and that project milestones arc met. A major priority of the Consultant Team will be to establish a continuing dialogue with staff, the Pier Plaza Committee and representatives of interested parties so that our products reflect community goals and City policy. Systematic Development of Alternative Plans The Consultant Team has found that alternative design plans are developed most efficiently through a systematic process of needs identification, criteria statement, concept development, interdisciplinary review and critique, and refinement. Frequent dialogue among the project manager, staff, consultants and members of the public is a dynamic and effective way to structure efficient planning concepts. This process results in a rapid consensus on the major components of alternative plans. This approach has been incorporated into the detailed Scope of Work as a means of ensuring that the development of alternatives results in realistic and implementable development. The Consultant Team's prior experience with concept formulation, alternatives development, and consensus building is an important ingredient in the successful completion of the comprehensive Pier Plaza Master Plan. Public Input Committee and/or agency workshops will be the fonim to establish project goals, introduce alternative plans, and obtain public comment. We propose to work closely with Staff and to organize and further define this element of the planning program. A properly designed community involvement program will 8 l) 14 rkiss-rose-rsi EXHIBIT A • Municipal Pier Architectural UpgradessPier-Head, City of Hermosa Beach 3. PROJECT APPROACH a. and b. Description of Approach and Communication with Subconsultants and Project Manager Purkiss Rose -RSI has developed an approach to each project based upon its past involvement working on similar projects using an interdisciplinary Consultant Team. Our approach incorporates four techniques used successfully on previous projects: 1. Extensive coordination with the project manager, City Staff, Consultants, Local Merchants Organizations, Community Committees, and the integration of their expertise and suggestions into the planning process; 2. Multi -agency input and research process to obtain all information, agency review process, submittal and approval process. Complete and thorough research of existing materials and field investigation. Team evaluation and value engineering of everyone's work to assure the best possible project for the budget. 3. Systematic concept development, group critique, and refinement to identify major components of the plans early in the planning process. Staffand Committee meetings to establish consensus on program use, improvements and facilities development. 4. The use of graphics to communicate planning and design concepts to community groups and decision makers. Further elaboration of these techniques is provided below. Coordination with City Staff, Consultants, Merchant and Community Committees The Consultant Team, led by the project manager is familiar with community planning projects. We have found that team work and close coordination among staff, consultants, and public agencies are essential to a successful project. We recognize that the Consultant Team will be responsible for ensuring that a high degree of coordination occurs and that project milestones arc met. A major priority of the Consultant Team will be to establish a continuing dialogue with staff, the Pier Plaza Committee and representatives of interested parties so that our products reflect community goals and City policy. Systematic Development of Alternative Plans The Consultant Team has found that alternative design plans are developed most efficiently through a systematic process of needs identification, criteria statement, concept development, interdisciplinary review and critique, and refinement. Frequent dialogue among the project manager, staff, consultants and members of the public is a dynamic and effective way to structure efficient planning concepts. This process results in a rapid consensus on the major components of alternative plans. This approach has been incorporated into the detailed Scope of Work as a means of ensuring that the development of alternatives results in realistic and implementable development. The Consultant Team's prior experience with concept formulation, alternatives development, and consensus building is an important ingredient in the successful completion of the comprehensive Pier Plaza Master Plan. Public Input Committee and/or agency workshops will be the fonmi to establish project goals, introduce alternative plans, and obtain public comment. We propose to work closely with Staff and to organize and further define this element of the planning program. A properly designed community involvement program will $ hurkiss-rose-rsi Municipal Pier Architectural Upgrades at Pier -Head, City of Hermosa Beach 3. PROJECT APPROACH ensure that opportunities for public review and comment occur at the appropriate stages of the planning process. Graphic Communication The importance of graphics as an effective communications tool in planning cannot be overemphasized. The Consultant Team prides itself on the superior quality of the graphic products from its planning and design activities. We propose that both graphic and written media be used to document the alternative and final conceptual programs and designs prepared by the Consultant Team members. We recommend that exhibits, illustrations, maps, and other graphic media be used as extensively as the project dictates. We offer the state of the art in communication tools coupled with the past successful Nvorking relationships and experience of our project manager to assure our clients a well coordinated project and quick response time. These intercommunication tools provide instant contact with our team and our clients. Also our long term relationship with our Team has instilled the desire and pride to meet or exceed our obligation and produce a product we can all be proud of. Our efforts have been rewarded by receiving many design awards for public works and park planning projects. Proposed Scope of Work The Scope of Work as spelled out in the Request for Proposal is very well defined and covers nearly all aspects necessary to complete the work. The site visit also was informative, and our scope incorporates information obtained from that process. Following please review our thoughts on a program Nye have utilized on similar projects, which augments the scope of work. Our work plan includes site evaluation, surveying, geotechnical testing, input meetings, development of conceptual plans and alternatives, preliminary plans, design development phase, construction document phase, assisting the City in permitting, and the construction support. PHASE I - PROJECT START (RESEARCH AND FACT-FINDING) Project Definition The project team will meet with staff for project review. We will obtain information on project requirements, programs, staffing, and maintenance from the various City and County Departments. We will obtain a consensus on the project approach, scope and schedule of work and meeting calendar. We will learn of all the players, such as County staff, interested merchants, and community members. We will also obtain all review, submittal and approvals requirements and timelines. Program Analyses Collect and evaluate available data on infrastructure. existing improvements, existing buildings, service access, other sources as directed by City and County, building system requirements, soils, communication, drainage and other information relevant to our site analysis; gather design done to date, parking needs, and program opportunities. Review site analysis information and finalize design program elements with Staff. A site survey and utility investigation will be scheduled as well as the geotechnical testing. PHASE II - SCHEMATIC DESIGN PHASE Conceptual Plans 9 purkiss-rose-rsi Municipal Pier Architectural Upgrades nt Pier -Head, city of Hermosa Beach 3. PROJECT APPROACH The Design Team will explore program of use, functional and visual relationships of desired elements established by the staff by looking at such components as access, service access, circulation, paving enhancements, seating areas, views and vistas, landscape enhancements, signage, sense of identity, architectural components, building materials, lighting, storage needs, ADA access, colors and site amenities. Conceptual alternatives will be generated, utilizing design work done to date. All utility needs will be evaluated. Complete opinion of probable construction costs for all proposed buildings and site improvements. Meet with City Departments including Public Works, Marine Safety Department, Parks and Recreation and Maintenance and Operations to review conceptual drawings and preliminary construction estimates. Gain preliminary, approval from City staff for the preferred concept and site components. Present the schematic design alternatives to local residences, or merchants group as directed by staff. Based on the obtained input and preferred conceptual plans, prepare a preliminary alternative that reflects the consensus of City staff and those involved in the review process. Present the final Master Plan to the City. Council for review and approval. PHASE III - DESIGN DEVELOPMENT Design Development Based on the approve Schematics drawing will be submitted drawings to staff for review and approval. Submittal will include the same level of detail from the entire consultant team. Documents shall accurately display building enhancements and new structures, colors and materials, site, lighting, signage, security and control systems improvements as well as utility improvements. We shall work with staff on value engineering and review of construction cost. PHASE IV - DEVELOPMENT OF CONSTRUCTION DRAWINGS Once the preliminary plans have been finalized and approved, the design team shall develop construction documents, timeline, and specifications for implementation. Construction Documents The construction documents will include the following: • Demolition plans • Architectural plans/details • Grading and drainage plans • All site amenities • Utility' plans • Electrical and lighting plans/details • Planting plan • Mechanical engineering plans/details • Irrigation plan • Signage plans (graphics) • Construction layout plan • Specifications • Construction/structural details Detailed construction cost estimate will be provided. • Drafting shall be performed on AutoCAD Release 14. 10 purkiss-rose-rsi Municipal Pier Architectural Upgrade. Pier -Head, City of Hermosa Beach 3. PROJECT APPROACH • Construction documents and specifications shall be prepared on WordPerfect (version 8/WIN) software. All construction documents produced shall be submitted on computer diskette. as well as "hard copy" plots or print-outs. • All architectural and engineering design details and calculations shall be based on design standards approved by the Department of Public Works. Construction shall conform to the Standard Specifications for Public Works construction, as adopted by the City at the time of construction. The design team will assist the City in meeting the conditions contained in the coastal development permit. Plan Check Plans shall be submitted as specified in the request for proposal. All comments from plan check shall be responded to quickly for resubmittal. The Design Team will assist during the bidding phase for clarification of construction documents and assist in bid review. The design team will assist the City in obtaining building permits and all other required permits as well as in obtaining reviews and approvals from applicable public agencies for design reviews, plan checks and permits, including, but not limited to the City of Hermosa Beach Public Works Department, and Parks, Recreation, and Marine Department, the Hermosa Beach Water Department, and the Hermosa Beach Gas Department. All permit costs will be paid by the City. The consultant shall provide continuous communication and feedback with various City personnel throughout the term of the project in order to ensure a cost-effective and quality design which meets the needs of the City. The project will be managed by the Department of Public Works. PHASE V - CONSTRUCTION SUPPORT SERVICES Bid Response Attend Pre-bid meeting and assist City by responding to contractors' questions and issue addenda if required during bidding. Coordinate with City to review bid documents. Construction Support The Design Team shall provide complete construction support services which include quotation requests, change orders, review and approve submittals and shop drawings and provide clarification drawings as required. Site observation and on going communication with staff and site inspectors (10 jobsite meetings). Visit the construction site as required to observe the project schedule and quality of work. Provide field reports per each site visit. Verify quality of work and compliance. Completion Prepare "as -built" drawings from record drawings provided by Contractor. Participate in preliminary and final \valkthrough and prepare final punch list. I I pttrkiss-rose-rsi Municipal Pier Architectural Upgrades at Pier -Head, City of Hermosa Beach 4. TIME LINE MONTH Aug 99 Sept 99 Oct 99 Nov 99 Dec 99 Jan 00 Feb 00 Mar 00 Apr 00 May 00 Jun 00 July to Dec 00 PHASE I - PROJECT START 0 Task 1. Project Definition ■ Task 2. Data Collection• Task 3. Base Map PHASE II - SCHEMATIC DESIGN Task I. Public Input ■ Task 2. Design Concepts Task 3. Cost Estimates • Task 4. L,avout Critiyue/Workshop PHASE III - DESIGN DEVELOPMENT Task I. Refinement of Schematic Design Task 2. Value Engineering PHASE IV - CONSTRUCTION DOCUMENTS Task 1. Construction Drawings —0 Task 2. Final Cost Estimate PHASE V - CONSTRUCTION SUPPORT PHASE • Task 1. Bidding _© Task 2. Construction Phase _p _© Nicclings 0 August 24, 1999 © March 28, 2000 4 January 25, 2000 0 April 24, 2000 0 December 15, 2000 12 purkiss rose-rsi • Municipal Pier Architectural Upgrades at Pier -Head, City of Hermosa Beach 5. STAFFING PLANS a. Organization Chart dose RSI Recreation and Par eve 'Rorse, Landscape Architect Q RC11I1.I7.CIT[IRAL , <Yeo FAIR Architects :Ron Yeo =FAIA • CIVIL ENGINEERING Walden and Assoc. Dave Walden Civil Engineer STRUCTURAL'='. ENGINEERING Correia Consulting and Design 2. Willie Correia, Structural Engineer ELECTRICAL GINEERING Consolidated Engineering David Lo Electrical Engineer. MECHANICAL/PLUMI3ING ENG ";F T Andrews Ray Cranston, P E:' GEOTECl3NICA TESTING Converse Consulfauts Orange Co Thomas Scheil Soil Engineer b. Key Personnel Purkiss Rose -RSI Landscape Architecture, Recreation and Park Planning presents the following team based on its interpretation of the planning requirements. Purkiss Rose -RSI Landscape Architecture, Recreation and Park Planning As prime consultant, we will assume full responsibility for coordination of the total project. Services will include assignment of planning responsibilities, client and public meetings, scheduling of project tasks, design refinement of the master plan and development of construction documents, plan check approvals, and preparation of status reports. Steve Rose, Senior Principal at Purkiss Rose -RSI, will act as facilitator and contractual representative of the firm and participate on the planning team. Steve has been with the firm for over 30 years and has worked on many public works projects and projects along our Southern California Beaches. Steve has worked with the 13 pi4rkiss-rose-rsi • October 6, 1999 Honorable Mayor and Members of Regular Meeting of The Hermosa Beach City Council October 12, 1999 REQUEST TO DENY APPLICATION TO PRESENT A LATE CLAIM Recommended Action: It is recommended that the City Council deny the application to file a late claim filed by Phillips Petroleum, et. al. Background: On August 2, 1999, the City received a claim from the attorney representing Phillips Petroleum Company, Union Oil of California, and Unocal Corporation alleging that the City, through a contract with a private waste hauler, deposited hazardous waste at a landfill know as the Cal Compact Site from 1959 through 1965. The City returned the claim as it was not filed within the time required by law. Analysis: While the claimant contends that they indeed have complied with the provisions for filing a timely claim, they have now served the City with an Application for Leave to Present a Late Claim. The City Attorney's Office has recommended that the City deny the application based on 1) the application is not timely since it is more than one year after the accrual of the cause of action; and 2) the late claim procedure arguably does not apply to claims subject to the one year statute of limitations applicable to the property damage claims at issue in this matter. Once the City Council denies the claimant's Application, they will have to petition the appropriate court for relief. This petition must be filed within six months of the City's denial of the application. Respectfully submitted: M hael Earl P-rsonnel & Risk Management Director Concur: Stephen Burrell City Manager 1k 1 MCCUTCHEN McCUrniEN, DOYLE, BROWN & ENERSEN, LU' September 28, 1999 VIA FACSIMILE AND U.S. MAIL Lisa Bond, Esq. Richards, Watson & Gershon 333 South Hope Street 38th Floor Los Angeles, CA 90071-1469 The Cal Compact Site Claim To The City Of Hermosa Beach Application For Leave To Present A Late Claim Cal. Gov. Code §§ 911.4 and 911.6 Direct (213) 680-6400 jdragna@mdbe.com Dear Ms. Bond: I write in response to the letter dated September 27, 1999 from the Director of Property & Liability Claims Administration of the City of Hermosa Beach, which concludes that the claim submitted to the City by Shell Oil Company for itself and for Shell Chemical Company, for themselves and for other PRPs at the Cal Compact Site ("Claimants") was not submitted within the time required under the Government Code. At your request, our response is directed to you as attorney for the City. As discussed below, the claim is timely. While the City has concluded that it is too late to apply for leave to present a late claim, and has also apparently rejected the claim on substantive grounds, Claimants nonetheless file this application to present a late claim pursuant to Cal. Gov. Code §§ 911.4 and 911.6 to preserve their full rights under the law. A. The Claim Is Timely As described in the attachment to the claim, the City is liable to Claimants under federal and state law, including, without limitation, CERCLA at 42 U.S.C. §§ 9607 and 9613, HSAA at Cal. Health & Safety Code § 25363, and equitable indemnity, for some or all of the response costs Claimants have incurred over the past several months at the Cal Compact Site as a result of the release of hazardous substances owned, possessed and transported to the Site by the City. None of Claimants' costs to date were incurred prior to March 1999. Claimants' payment reimbursing the Department of Toxic Substances Control for certain oversight costs incurred at ATTORNEYS AT LAW SEP -29-1999 11:04 355 South Grand Avenue, Suite 4400 Los Angeles, California 90071-1560 Tel. (213) 680-6400 Fax (213) 680-6499 www.mccutchen.com San Francisco Palo Alto Los Angeles Taipei Walnut Creek 1 213 660 6499 96% P.02 • • September 28, 1999 Page 2 the Site, for example, was paid on April 23, 1999, while preparation of the workplan for characterizing the lower aquifers at the Site commenced shortly thereafter. Since the claim for these costs did not accrue until the costs were incurred, less than six months elapsed between the date of accrual and the date on which the claim was presented. Pursuant to the Government Code, claims related to damage to real property, such as this one, must be submitted within one year of the date of accrual. See Cal. Gov. Code § 911.2 ("A claim [other than a claim relating to "death, injury to person, personal property, or growing crops"] shall be presented ... not later than one year after the accrual of the cause of action" [emphasis added]). Since the claim for Claimants' costs to date was submitted within one year of accrual, it is timely. In addition to their own costs incurred to date, Claimants also seek contribution under CERCLA and statutory contribution and indemnity under HSAA from the City for some or all of the costs, damages and liability Claimants may incur in the action entitled Commercial Realty Projects, Inc., et al. v. Atlantic Richfield Company, et al, Case No. CV 97-6222 MRP (MANx). Under both CERCLA and HSAA, such claims accrue on the date of the judgment, administrative order or entry of a court -approved settlement under which such costs and/or liability are incurred. See, e.g., 42 U.S.C. § 9613(g)(3). The Government Code claims presentation requirements incorporate these statutory accrual standards. See Cal. Gov. Code § 901. Since Claimants have not yet suffered a loss through a judgment or settlement in the Commercial Realty Projects action, the limitations period under the Government Code for these statutory claims based on this action has not yet begun to run. These claims, like the claims based on Claimants' own response costs to date, are therefore timely. We therefore request that that City reconsider its rejection of the claim on timeliness grounds, and consider the substance of the claim. B. Application For Leave To Present A Late Claim While Claimants vigorously dispute the City's contention that the claim is untimely, Claimants hereby apply for leave to present the claim under the late -claim provisions of Cal. Gov. Code §§ 911.4 and 911.6. As discussed above, the City's conclusion that the claim was untimely is erroneous since.none of the claims presented accrued prior to March 1999, and since the correct statutory period for claims based on damage to real property is the one-year period under Gov. Code § 911.2. To the extent, however, that the six-month period applies, and the claim was not filed within this period, the lateness of the claim is excusable since Claimants did not incur any response costs, or suffer any other harm redressable through a claim against SEP -29-1999 11:04 1 213 680 6499 97% P.03 September 28, 1999 Page 3 the City, in connection with the Site until March 1999. In addition, the City's acts triggering its liability for conditions at the Site occurred more than thirty years ago, greatly increasing the difficulty for Claimants in obtaining evidence of the City's potential liability at the Site. Moreover, since the Site has remained vacant since landfill operations ceased in 1965, and since no substantial remedial work has yet been performed at the Site, the City is not prejudiced by any delay in the presentation of this claim. * * * * * * * * For the reasons stated above, Claimants request that the City reconsider its rejection of the claim and consider the claim on its merits. In the alternative, Claimants hereby present this application for leave to file a late claim pursuant to Gov. Code §§ 911.4 and 911.6 for the reasons stated above. SEP -29-1999 11:04 1 213 680 6499 97 P.04 • October 7, 1999 Honorable Mayor and Members of the Hermosa Beach City Council • e4q- ro-ta-97 Regular Meeting of October 12, 1999 REVIEW OF FIESTA HERMOSA Recommendation: That the City Council request that the Fiesta Subcommittee meet with the Chamber of Commerce and prepare a report for the December 14, 1999 meeting. Background: The agreement with the Chamber of Commerce provides for a review of the events after the Labor Day event. In order to provide a complete review and offer ideas for improvements for next year, it is suggested that the subcommittee that met several times last year to work out the details for the Fiesta meet again and prepare a report for full consideration by the City Council and the public at the December 14th meeting. This would allow interested parties to provide input to the City and Chamber that would be reviewed by the subcommittee for inclusion in the report to the City Council. Respectfully submitted, Stephen R. Burrell City Manager 11 111 /1 Io - ►a- cf9' 004,445 Oal; October 4, 1999 City Council Meeting October 12, 1999 Mayor and Members of the City Council ORDINANCE NO. 99-1194 - "AN ORDINANCE OF THE CITY OF HERMOSA BEACH, CALIFORNIA, AMENDING SECTION 10.32.250 OF THE MUNICIPAL CODE TO REMOVE THE HOURS OF ENFORCEMENT FOR GREEN CURB MARKINGS." Submitted for adoption and waiver of full reading is Ordinance No. 99-1194, relating to the above subject. At the meeting of September 28, 1999, the ordinance was presented to Council for consideration and introduced by the following vote: AYES: Benz, Bowler, Edgerton, Mayor Pro Tempore Reviczky NOES: None ABSENT: Mayor Oakes ABSTAIN: None Elaine Doerfling, C Step'. urrell, City Manager ORDINANCE NO. 99-1194 AN ORDINANCE OF THE CITY OF HERMOSA BEACH, CALIFORNIA, AMENDING SECTION 10.32.250 OF THE MUNICIPAL CODE TO REMOVE THE HOURS OF ENFORCEMENT FOR GREEN CURB MARKINGS THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1. Section 10.32.250 is amended to read as follows: Section 10.32.250 Green Curb Markings. Green Curb marking shall mean no standing or parking for a period of time longer than fifteen (15) minutes at any time or as posted on authorized signs. SECTION 2. This ordinance shall become effective and be in full force and effect from and after thirty (30) days of its final passage and adoption. SECTION 3. Prior to the expiration of fifteen (15) days after the date of its adoption, the City Clerk shall cause this ordinance to be published in the Easy Reader, a weekly newspaper of general circulation published and circulated in the City of Hermosa Beach, in the manner provided by law. SECTION 4. The City Clerk shall certify to the passage and adoption of this ordinance, shall enter the same in the book of original ordinances of the City, and shall make minutes of the proceedings of the City Council at which the same is passed and adopted. -1- • • PASSED, APPROVED and ADOPTED this 12th day of October, 1999 by the following vote: AYES: NOES: ABSENT: ABSTAIN: PRESIDENT of the City Council and MAYOR of the City of Hermosa Beach, California ATTEST: APPROVED AS TO FORM: City Clerk City Attorney -2- October 7, 1999 Honorable Mayor and Members of the Hermosa Beach City Council �%te2to-ac,-99 Regular Meeting of October 12, 1999 A GROUND LEASE OF CITY OWNED PROPERTY BETWEEN THE CITY OF HERMOSA BEACH AND AND CONSTRUCT, MAINTAIN OPERATE A RETAIL BUILDING LOCATED AT 1303 HERMOSA AVENUE The details of the lease agreement are still being worked out by the developers and City staff. It is recommended that this item be continued to your meeting of October 26, 1999. Respectfully submitted, St phen R. Burrell City Manager • September 20, 1999 Honorable Mayor and Members of The Hermosa Beach City Council 467940442.4 /6 -f2-q' . 4agat u-oJxi idetitab ( / Regular Meeting o�R- " October 12, 1999 RESOLUTION AUTHORIZING THE TRANSFER OF THE CABLE TELEVISION FRANCHISE FROM CENTURY COMMUNICATIONS CORPORATION TO ADELPHIA COMMUNICATIONS CORPORATION Recommendation Staff recommends that Council: 1. Listen to presentation by Adelphia about their company. 2. Adopt Ordinance #99- -U amending Ordinance #94-1117, which granted a nonexclusive Franchise for the operation of a cable television system within the City, and declaring the urgency thereof. 3. Adopt Ordinance #99- amending Ordinance #94-1117, which granted a nonexclusive Franchise for the operation of a cable television system within the City. 4. Adopt the attached Resolution #99- authorizing the transfer of control of the Cable Television Franchise by Century Communications Corporation to Adelphia Communications Corporation. Background On April 29, 1999, Century Valley Cable Corp. delivered FCC form 394 to the City, requesting consent for the transfer of the City's cable television system from Century to Adelphia. Per FCC guidelines, the City has 120 days to review a Form 394 to determine if a prospective company has the legal, technical, and financial qualifications to serve the requirements of the Franchise. To adequately review information from Adelphia, the City requested and Adelphia approved an extended review period through September 29, 1999. Subsequently, due to scheduling difficulties at Adelpia, the review period was extended to October 13, 1999. Randy Fisher, General Counsel for Adelphia, will make a presentation to the Council at the meeting, introducing the company and discussing some of the new services that will be offered to Hermosa Beach cable customers. Analysis William Rudell, from Richards, Watson & Gershon reviewed the City's form 394 and requested supplemental information on behalf of Hermosa Beach and the 13 other local franchising authorities the law firm represents. 5 • • The City Attorney's review concluded that Adelphia meets the legal, technical, and financial qualifications required to ensure the performance of the obligations of the existing cable television franchise agreements. In addition, the City met with representatives of Adelphia to discuss four issues of concern. Issues numbered 1-3 below are addressed with amendments to Ordinance #94-1117 (Attachment B) and the fourth issue has been addressed in a side letter (Attachment D). 1. Internet Services: The City requested free modem installation and monthly Internet service for City Hall and satellite facilities (once the services are available) with no pass through costs assigned to consumers. Adelphia agreed to offer up to 20 modems and monthly service free of charge for the 20 stations to the City without pass through fees. 2. Technical Audit: The City requested and Adelphia agreed to conduct a technical audit to include compliance with City ordinances immediately following the October 1, 1999 system re -build. This audit will check to see that City Public works standards and the technical requirements of the Franchise are met. 3. Open access: With amendments to our existing Ordinance, the City reserves any rights it may have to impose conditions regarding third party access to the cable system for delivering Internet service. 4. Fiber Optic lines: Upon the City's request, Adelphia will install fiber optic lines at actual cost. The City does not have any current plans to do this, however, we thought it may be prudent to ask for this benefit in the event we may wish to use it in the future (Manhattan Beach has a similar agreement). The Cities of Manhattan and Redondo Beach are also processing Forms 394 for this proposed transfer. Manhattan Beach has secured the services of cable consultants (Communications Support Group) who are still in discussions with Century/Adelphia about the transfer. Similarly, Redondo Beach has not concluded their review of Form 394. If Council approves the transfer this meeting, it is possible that the other cities may negotiate for additional benefits with a protracted review period. The questions we forwarded to the applicant were answered with sufficient time for the City Attorney's office°to review. From this and the original application, they were unable to find any information that would preclude the City Council from making findings that the proposed transferee would meet the Franchise requirements. Since the City's current Franchise agreement is constructed as an ordinance (often cities do this via resolution), the urgency provision is required in order to complete the transfer agreement within the authorized review period. r • • Fiscal Impact: 1. Per the Franchise Ordinance, the City Attorney's bill for processing Form 394 (currently estimated at $2,500) will be charged to Century. 2. City Franchise fee: No fiscal impact 3. If the City elects to use free Internet service, there may be annual savings to the General Fund. Attachments (A) Ordinance #99- -U amending Ordinance NO. 94-1117, which granted a nonexclusive Franchise for the operation of a cable television system within the City, and declared the urgency thereof. (B) (C) Ordinance #99- amending Ordinance #94-1117, which granted a nonexclusive Franchise for the operation of a cable television system within the City. Resolution # 99- authorizing the transfer of control of the Cable Television Franchise by Century Communications Corporation to Adelphia Communications Corporation. (D) Letter of agreement for fiber optic line installation. (E) Marketing materials from Adelphia Communications Corporation on file in the City Clerk's Office. Respectfully submitted, Mary Direor, Community Resources Concur: Ste urrell City Manager /Yat Av Y1 A Michael Jenkins City Attorney Noted for Fiscal Impact: Viki Copeland Director, Finance • CITY OF HERMOSA BEACH LOS ANGELES COUNTY, CALIFORNIA ORDINANCE NO. - U AN ORDINANCE OF THE CITY OF HERMOSA BEACH AMENDING ORDINANCE NO. 94-1117, WHICH GRANTED A NONEXCLUSIVE FRANCHISE FOR THE OPERATION OF A CABLE TELEVISION SYSTEM WITHIN THE CITY, AND DECLARING THE URGENCY THEREOF THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH DOES ORDAIN AS FOLLOWS: SECTION 1. This ordinance is adopted in consideration of the following facts and circumstances: A. Ordinance No. 94-1117,'as adopted by the City Council of the City of Hermosa Beach on September 27, 1994, authorized a cable television franchise renewal between the City and ML Media Partners, L.P. That franchise authorizes the construction, operation, and maintenance of a cable television system within the City. B. On July 25, 1995, the City Council of the City of Hermosa Beach adopted Resolution No. 95-5761, which authorized and approved the assignment and transfer of the cable television franchise by ML Media Partners, L.P. to Century Valley Cable Corp., a wholly-owned subsidiary of Century Communications Corp., a New Jersey corporation. C. On May 25, 1999, the City Council of the City of Hermosa Beach adopted Resolution No. 99-5992, which authorized and approved the assignment and transfer of the cable television franchise by Century Valley Cable Corp. to Century -TCI California, L.P., a Delaware limited partnership. That transaction, has not been consummated as of September 28, 1999. D. On April 21, 1999, the City received from Century Communications Corp., as the proposed transferor, and from Adelphia Communications Corporation, as the proposed transferee, an application for a transfer of control of the cable television franchise that may become effective either before or after the assignment and transfer of the franchise to Century -TCI California, L.P., which transaction is referenced above in paragraph C. 990921 10649-00001 amo 0594241 • • E. The City and Century Valley Cable Corp. have negotiated certain amendments to the cable television franchise agreement for the purpose of clarifying and modifying certain rights and obligations of the parties relating to the operation and maintenance of the cable television system within the City, as previously authorized by Ordinance No. 94-1117. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH DOES ORDAIN AS FOLLOWS: Section 1. Paragraph (b) of Section 3 of Ordinance No. 94-1117 is amended as follows: A. By redesignating paragraph (b), entitled "Construction Time Schedule," as paragraph (b)(1). B. By adding a new subsection (2) to paragraph (b) to read as follows: "(2) Following the GRANTEE's completion of the Phase II rebuild/upgrade, GRANTEE must perform a comprehensive technical audit of that Phase II work to ensure that all applicable technical standards have been met and that the work complies with all applicable federal requirements and City codes and regulations. GRANTEE must provide to the City a written report that documents the results of this audit no later than six months following the transfer of control of the franchise from GRANTEE'S parent company to Adelphia Communications Corporation." Section 2. Section 3 of Ordinance No. 94-1117 is amended by adding a new paragraph (h) to read as follows: "(h) During the course of the Phase II rebuild/upgrade, GRANTEE will commence an audit of all subscriber service drops within the City, and this audit will be completed no later than 180 days after the transfer of control of the franchise from GRANTEE'S parent company to Adelphia Communications Corporation, subject to the granting of access by owners of private property. If such access is denied or delayed, GRANTEE will continue to seek owner consent to access beyond the 180 -day period and until all subscriber service drops have been inspected. GRANTEE's audit and inspection obligations will include the following: (1) The inspection of 100% of all aerial and underground physical plant and 100% of all subscriber service drops. 990921 10649-00001 amo 0594241 - 2 - • • (2) All active subscriber service drops will be certified by GRANTEE to be code compliant, and inactive subscriber service drops will be removed if necessary. (3) All safety code defects and deficiencies in the physical plant and in the subscriber service drops that are disclosed in the inspection will be corrected by the GRANTEE. (4) GRANTEE will submit to the City monthly progress reports that will identify the results of the physical plant inspections and the corrective actions taken. These monthly reports will specify the addresses of the subscriber service drops and physical plant that have been inspected and the nature of the corrective actions that have been taken. (5) Upon completion, GRANTEE will participate with the City in an evaluation of the GRANTEE's audit and inspection activities in order to confirm that all necessary remedial actions have been taken by the GRANTEE." Section 3. Paragraph (j) of Section 4 of Ordinance No. 94-1117 is amended by adding at the end thereof the following language: "In addition to the free basic cable service that is referenced above in this paragraph (j), GRANTEE will provide, at such time as that service is offered on a commercial basis to residential subscribers to the cable television system, and upon the City's request, the installation of cable modems that provide Internet access service. These cable modems and their installation will be without cost to the City and without offset to the franchise fees paid to the City under the franchise, and will be limited to an aggregate of 20 cable modems and related installation services at City -owned or other public buildings within the franchise service area. The City is authorized to select from programs that are offered to consumers and to institutions the type of service to be provided by these 20 cable modems. If the City requests more than one cable modem installation at any one location, or if the City requests additional installations beyond the 20 allocated by GRANTEE, then City will reimburse GRANTEE for the costs of labor and materials associated with (i) the wiring installation of the multiple modem - site configuration, and (ii) additional cable modems that are requested by the City. Notwithstanding the references above to an aggregate of 20 cable modems, if either the City of Redondo Beach or the City of Manhattan Beach is provided by GRANTEE, or by any authorized transferee, or affiliate or parent company 990921 10649-00001 amo 0594241 - 3 - • • of GRANTEE, with a number of free cable modems in excess of 20, then City will also be entitled to receive that number of cable modems without charge and subject to the provisions of this paragraph (j)." Section 4. Attached to this ordinance in the form presented to the City Council is the "Franchisee's Acceptance" of this ordinance amending Ordinance No. 94-1117, which document will be signed by an authorized representative of Century Valley Cable Corp. within 30 days after the effective date of this ordinance. Section 5. The City Council finds and determines that Century Communications Corp., the ultimate parent company of the City's franchised cable operator, Century Valley Cable Corp. ("Century"), has filed with the City a request to authorize a transfer of control of the cable television franchise to Adelphia Communications Corporation. In the course of the City's review of the documentation accompanying Century's request for consent to this transfer, Century agreed to negotiate with the City certain amendments to the cable television franchise agreement for the purpose of clarifying and modifying certain rights and obligations of the parties. These provisions are set forth in this ordinance, which amends Ordinance No. 94-1117 previously adopted by the City Council on September 27, 1994. It is necessary, desirable, and in the best interests of the residents of the City that the obligations of Century, as set forth in this ordinance, be fixed and in place prior to the City Council's consent to the requested transfer of control of the franchise. The immediate effectiveness of this ordinance will eliminate potential delays in completing and auditing the upgrade of the cable television system, eliminate confusion and uncertainty on the part of subscribers who desire to receive enhanced cable programming services and new cable -related services, facilitate administrative oversight by City staff, and enable the new cable operator, or the new owner of the cable operator, or both, to proceed expeditiously with the completion of upgrade and the installation of new facilities that will, among other things, transmit emergency alert signals in the event of a disaster or public emergency. For the reasons set forth above, this ordinance is an urgency ordinance that is necessary for the immediate preservation of the public peace, health, and safety within the meaning of Section 36937(b) of the Government code. Therefore, this ordinance will take effect immediately upon its adoption. 990921 10649-00001 amo 0594241 - 4 • . Section 6. The City Clerk is directed to certify to the passage and adoption of this ordinance and to cause it to be published or posted as required by law. PASSED, APPROVED and ADOPTED this day of 1999. ATTEST: CITY CLERK APPROVED AS TO FORM: CITY ATTORNEY 990921 10649-00001 amo 0594241 - 5 - MAYOR • • FRANCHISEE'S ACCEPTANCE Century Valley Cable Corp., a Delaware corporation, • which is the authorized cable television franchisee in the City of Hermosa Beach, agrees to and accepts the terms and provisions of Ordinance No. -U amending Ordinance No. 94-1117. Century Valley Cable Corp., a Delaware corporation By: (Authorized Corporate Officer) Title: Dated: 990921 10649-00001 amo 0594241 • • CITY OF HERMOSA BEACH LOS ANGELES COUNTY, CALIFORNIA ORDINANCE NO. AN ORDINANCE OF THE CITY OF HERMOSA BEACH AMENDING ORDINANCE NO. 94-1117, WHICH GRANTED A NONEXCLUSIVE FRANCHISE FOR THE OPERATION OF A CABLE TELEVISION SYSTEM WITHIN THE CITY THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH DOES ORDAIN AS FOLLOWS: SECTION 1. This ordinance is adopted in consideration of the following facts and circumstances: A. Ordinance No. 94-1117, as adopted by the City Council of the City of Hermosa Beach on September 27, 1994, authorized a cable television franchise renewal between the City and ML Media Partners, L.P. That franchise authorizes the construction, operation, and maintenance of a cable television system within the City. B. On July 25, 1995, the City Council of the City of Hermosa Beach adopted Resolution No. 95-5761, which authorized and approved the assignment and transfer of the cable television franchise by ML Media Partners, L.P. to Century Valley Cable Corp., a wholly-owned subsidiary of Century Communications Corp., a New Jersey corporation. C. On May 25, 1999, the City Council of the City of Hermosa Beach adopted Resolution No. 99-5992, which authorized and approved the assignment and transfer of the cable television franchise by Century Valley Cable Corp. to Century -TCI California, L.P., a Delaware limited partnership. That transaction has not been consummated as of September 28, 1999. D. On April 21, 1999, the City received from Century Communications Corp., as the proposed transferor, and from Adelphia Communications Corporation, as the proposed transferee, an application for a transfer of control of the cable television franchise that may become effective either before or after the assignment and transfer of the franchise to Century -TCI California, L.P., which transaction is referenced above in paragraph C. E. The City and Century Valley Cable Corp. have negotiated certain amendments to the cable television franchise agreement for the purpose of clarifying and modifying certain rights and obligations of the parties relating to the operation 990921 10649-00001 amo 0594240 (2) • • and maintenance of the cable television system within the City, as previously authorized by Ordinance No. 94-1117. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH DOES ORDAIN AS FOLLOWS: Section 1. Paragraph (b) of Section 3 of Ordinance No. 94-1117 is amended as follows: A. By redesignating paragraph (b), entitled "Construction Time Schedule," as paragraph (b)(1). B. By adding a new subsection (2) to paragraph (b) to read as follows: "(2) Following the GRANTEE's completion of the Phase II rebuild/upgrade, GRANTEE must perform a comprehensive technical audit of that Phase II work to ensure that all applicable technical standards have been met and that the work complies with all applicable federal requirements and City codes and regulations. GRANTEE must provide to the City a written report that documents the results of this audit no later than six months following the transfer of control of the franchise from GRANTEE'S parent company to Adelphia Communications Corporation." Section 2. Section 3 of Ordinance No. 94-1117 is amended by adding a new paragraph (h) to read as follows: "(h) During the course of the Phase II rebuild/upgrade, GRANTEE will commence an audit of all subscriber service drops within the City, and this audit will be completed no later than 180 days after the transfer of control of the franchise from GRANTEE'S parent company to Adelphia Communications Corporation, subject to the granting of access by owners of private property. If such access is denied or delayed, GRANTEE will continue to seek owner consent to access beyond the 180 -day period and until all subscriber service drops have been inspected. GRANTEE's audit and inspection obligations will include the following: (1) The inspection of 100% of all aerial and underground physical plant and 100% of all subscriber service drops. (2) All active subscriber service drops will be certified by GRANTEE to be code compliant, and inactive subscriber service drops will be removed if necessary. (3) All safety code defects and deficiencies in the physical plant and in the subscriber service drops 990921 10649-00001 amo 0594240 (2) - 2 - • • that are disclosed in the inspection will be corrected by the GRANTEE. (4) GRANTEE will submit to the City monthly progress reports that will identify the results of the physical plant inspections and the corrective actions taken. These monthly reports will specify the addresses of the subscriber service drops and physical plant that have been inspected and the nature of the corrective actions that have been taken. (5) Upon completion, GRANTEE will participate with the City in an evaluation of the GRANTEE's audit and inspection activities in order to confirm that all necessary remedial actions have been taken by the GRANTEE." Section 3. Paragraph (j) of Section 4 of Ordinance No. 94-1117 is amended by adding at the end thereof the following language: "In addition to the free basic cable service that is referenced above in this paragraph (j), GRANTEE will provide, at such time as that service is offered on a commercial basis to residential subscribers to the cable television system, and upon the City's request, the installation of cable modems that provide Internet access service. These cable modems and their installation will be without cost to the City and without offset to the franchise fees paid to the City under the franchise, and will be limited to an aggregate of 20 cable modems and related installation services at City -owned or other public buildings within the franchise service area. The City is authorized to select from programs that are offered to consumers and to institutions the type of service to be provided by these 20 cable modems. If the City requests more than one cable modem installation at any one location, or if the City requests additional installations beyond the 20 allocated by GRANTEE, then City will reimburse GRANTEE for the costs of labor and materials associated with (i) the wiring installation of the multiple modem - site configuration, and (ii) additional cable modems that are requested by the City. Notwithstanding the references above to an aggregate of 20 cable modems, if either the City of Redondo Beach or the City of Manhattan Beach is provided by GRANTEE, or by any authorized transferee, or affiliate or parent company of GRANTEE, with a number of free cable modems in excess of 20, then City will also be entitled to receive that number of cable modems without charge and subject to the provisions of this paragraph (j)." 990921 10649-00001 amo 0594240 (2) - 3 - • • Section 4. Attached to this ordinance in the form presented to the City Council is the "Franchisee's Acceptance" of this ordinance amending Ordinance No. 94-1117, which document • will be signed by an authorized representative of Century Valley Cable Corp. within 30 days after the effective date of this ordinance. Section 5. The City Clerk is directed to certify to the passage and adoption of this ordinance and to cause it to be published or posted as required by law. PASSED, APPROVED and ADOPTED this day of 1999. ATTEST: CITY CLERK APPROVED AS TO FORM: CITY ATTORNEY 990921 10649-00001 amo 0594240 (2) - 4 - MAYOR • • FRANCHISEE'S ACCEPTANCE Century Valley Cable Corp., a Delaware corporation,• which is the authorized cable television franchisee in the City of Hermosa Beach, agrees to and accepts the terms and provisions of Ordinance No. amending Ordinance No. 94-1117. Century Valley Cable Corp., a Delaware corporation By: (Authorized Corporate Officer) Title: Dated: 990921 10649-00001 amo 0594240 (2) • • RESOLUTION NO. A RESOLUTION OF THE CITY OF HERMOSA BEACH AUTHORIZING THE TRANSFER OF CONTROL OF A CABLE TELEVISION FRANCHISE BY CENTURY COMMUNICATIONS CORP. TO ADELPHIA COMMUNICATIONS CORPORATION THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH DOES RESOLVE AS FOLLOWS: Section 1. This resolution is adopted in consideration of the following facts and circumstances: A. Century Valley Cable Corp., a Delaware corporation ("Franchisee"), is the duly authorized holder of a franchise ("Franchise") that authorizes the construction, operation, and maintenance of a cable television system within the City of Hermosa Beach ("Franchise Authority"). B. On May 25, 1999, the Franchise Authority adopted Resolution No. 99-5992, which authorized the assignment and transfer of the Franchise by Franchisee to Century -TCI California, L.P., a Delaware limited partnership. Century -TCI California, L.P. will be managed by Century Communications Corp. ("Century") and will be owned approximately 75% by Century and 25% by affiliates of Tele-Communications, Inc. As of the date of adoption of this resolution, that previously authorized assignment and transfer has not occurred. C. On April 22, 1999, the Franchise Authority received from Century, as the proposed transferor, and from Adelphia Communications Corporation ("Adelphia"), as the proposed transferee, an application for a transfer of control of the Franchise that may become effective either before or after the assignment and transfer of the Franchise to Century -TCI California, L.P. This application included FCC Form 394 entitled "Application for Franchise Authority Consent to Assignment or Transfer of -Control of Cable Television Franchise." Supplemental information relating to the proposed merger of Century with and into Adelphia was provided to the Franchise Authority. D. By the adoption of Ordinance No. -U on September 28, 1999, the Franchise Authority has authorized certain amendments to the Franchise that will be of benefit to the Franchise Authority and to all cable television subscribers within the franchise service area. E. In accordance with paragraph E of Section 5.16.030 of Chapter 5.16 of the Hermosa Beach Municipal Code, the Franchise Authority has the right to review and to approve the financial, technical, and legal qualifications of the proposed transferee in connection with the proposed change of control of 990921 10649-00001 syc 0594239 (1) • • the Franchise that may occur either before or after its assignment and transfer to Century -TCI California, L.P. F. The staff of the Franchise Authority has reviewed the documentation that accompanied FCC Form 394 and, based upon the representations set forth in that documentation, has concluded that the proposed transferee has the requisite financial, technical, and legal qualifications to adequately perform, or to ensure the performance of, all obligations required of the Franchisee or of Century -TCI California, L.P. following its assumption of the Franchise. Section 2. The Franchise Authority, in accordance with paragraph E of Section 5.16.030 of Chapter 5.16 of the Hermosa Beach Municipal Code, consents to and approves the proposed transfer of control of the Franchise by Century to Adelphia, whether that transfer of control occurs before or after the assignment of the Franchise to Century -TCI California, L.P. Section 3. The authorization, consent and approval of the Franchise Authority to the proposed change of control is conditioned upon compliance by the transferor or the transferee with the following requirements, as to which they are jointly and severally responsible: A. An original or conformed copy of the written instrument evidencing the closing and consummation of the merger resulting in the proposed change of control of the Franchise must be filed in the office of the City Clerk within 30 days after that closing and consummation. B. The Franchise Authority will be reimbursed for all costs and expenses reasonably incurred by the Franchise Authority in processing and evaluating the information relating to the proposed change of control of the Franchise; provided, however, that those costs and expenses will not exceed the sum of $2500 and will be set forth in an itemized statement transmitted by the City Manager, or the City Manager's designee, to the transferor and the transferee within 60 days after the effective date of this Resolution. Section 4. In approving this transfer, the Franchise Authority reserves any rights it may have to impose conditions regarding access by third parties to transferee's cable system for the delivery of Internet access service, and the Franchise Authority's approval of the transfer shall not be deemed to have waived any such rights it may have to impose such conditions at a later date, regardless of whether a transfer or renewal is pending at that time. Transferee likewise does not waive any right it may have with respect to the imposition of such a condition. Prior to the enactment or enforcement of any such requirement, transferee shall be provided with reasonable notice, an opportunity to be heard, and an opportunity to present 990921 10649-00001 syc 0594239 (1) - 2 evidence on any findings made or required to be made with respect to such a requirement. construed terminate certified the Section 5. Nothing contained in this resolution may be to extend the term of the Franchise, which will in its entirety on October 26, 2004. Section 6. The City Clerk is directed to transmit a copy of this resolution to the following persons: Clifford A. Bail, Esq. Century Communications Corp. 50 Locust Avenue New Canaan, Connecticut 06840 Randolph D. Fisher, Esq. Vice President and General Counsel Adelphia Communications Corporation Main at Water Street Coudersport, Pennsylvania 16915 Mr. Michael Guise General Manager Century Valley Cable Corp. 1529 Valley Drive Hermosa Beach, California 90254 Section 7. The City Clerk is directed to passage and adoption of this resolution. certify to PASSED, APPROVED, AND ADOPTED this day of , 1999. ATTEST: CITY CLERK 990921 10649-00001 syc 0594239 (1) - 3 MAYOR .� "AUG_ RUG . 19.199 3 12 : 40PM CENTURY COMMUNICATIONS ID: 1 North Main Street Couderepart, N. 16915-1141 f+ iIa Phone (Bt 4) 274.9830 lntomet www.edelptvq.net yiA FM IM1LE: August 19, 1999 Mary C. Rooney, Assistant City Manager Director, County Resources Department City of Hermosa Beach Community Center 710 pier Avenue Hermosa Beach, CA 90254 RE: ."414118.1 ;"/ A 'b ,J • NO.814 P.2/3 2/2 Dear Ms. Rooney: Adelphia Communications Corporation agrees to assist the City in providing a fiber interconnect between the City and its public buildings within the City at the cost of labor and materials. If you have any questions, you may contact me at (814) 274-6446. Very truly yours, Colin H. Higgin Deputy General Counsel CHH:mh OCT -12-99 04:58 PM LEE_PERRON_FAX • Adeiphia Lee A. Perron Vice President Corporate Affairs October 12, 1999 Mary Rooney Community Resources Director City of Hermosa Beach 710 Pier Avenue Hermosa Beach, CA 90254 Dear Mary: 310 264 8018 P.02 INFORM -HON ,,1.7 As we discussed, the following information is provided to clarify Adelphia's commitment to the provision of Internet access service in the City of Hermosa Beach. A. If the Transferee provides high speed cable modems or any intemet access services within the City of Hermosa Beach service area, Transferee, upon request from the City shall provide the capability to broadcast City Council meetings live on the internet via streaming video and audio. The costs associated with the provision of this service shall be considered to be subject to pass through calculations. B. Transferee shall, upon request, provide the City with a comprehensive, detailed proposal for the infrastructure and components necessary to provide the City with Institutional Internet Access at T1 equivalent or greater bandwidth at 50% minimum Committed Information Rate (CIR) with dedicated TCP/IP addresses, web hosting and other business related Internet Services. Transferee shall pay all costs not -to -exceed $30,000. If costs exceed $30,000 the City and Transfcrcc shall mutually agree to payment of all additional costs prior to implementation of the proposal. For the first year services provided to the City, Transferee shall provide fifteen hundred dollars ($1,500) per month worth of business related Internet services to the City at no cost. F.ach subsequent year, the amount of services provided shall increase by the Consumer Price Index of the preceding year. Please contact my office if I may be of any further assistance. Sincerely, tos32, Lee A. Perron Vice President Corporate Affairs Copy: Nigel Ives Randy Fisher Shirley Orr 2939 Nebraska Avenue Santa Monica, CA 90404 e-mail: Iperron@adelphia.net 412/2f2e4IcjC--/Ze /0 —1 9, • • • • ADELPHIA Executive Offices Renovated School House Coudersport, PA Mission Statement Our goal at Adelphia is to make sure that every customer is satisfied with the outcome of every contact he or she has • with the company. • As a result of our commitment we... •Care for our customers • Care for our People • Care for our community •Care for our stockholders Products and Services that we offer... • *Cable Entertainment •Digital Cable Services •Powerlink •Pagetime •Adelphia Long Distance • •Adelphia Business Solutions •Adelphia Home Security •Adelphia Media Services • Commitment to Customer Care Establish and maintain Customer Care Call Centers that serve geographic areas and meet the company goal of 100% customer satisfaction. • Commitment to Training Utilize the Company's resources to fully train all • associates to strive for perfection in their performance. The Training Center All Service Personnel are trained Skills acquired are designed to meet the goal of 100% Customer Satisfaction! 0 • Simulated learning environments. • "Companies such as a Adelphia are integral to the type of State and Nation that I want Pennsylvania and The United States to be in the 21st Century. I praise The Rigas Family for their strong business leadership" Governor Tom Ridge • Review of Adelphia's Customer Service and Operations. Independent Study conducted on Adelphia's 30 largest cable system's by Telecommunications Management Corp. (TMC) Advanced Services The Study states Adelphia is fairly aggressive in the introduction of advanced services on its cable services, based on plant mileage of systems at state-of-the-art capacity (750MHz) • Rates Many of the contacts indicated that Adelphia charged less than it could on "expanded basic". TMC Review Continued... Comments by Municipal Officials The change of ownership was relevantly transparent to subscribers, since Adelphia made relatively few personnel changes. The contact stated that he had no reason not to recommend Adelphia to a franchising authority considering Adelphia. considering Adelphia as a potential transferee. State of Connecticut • Adelphia was described as being one of the better franchises in the County for customer service, and the County would recommend Adelphia to other communities. Lee County, Florida TMC Review Continued... Adelphia was described as being "small, but big" in that the top management of the system (the Rigas family) are known at the local regulatory level, even though the • company has become very large. The system is one that is proposed to be swapped with Comcast, and the Township representative sounded sorry to see Adelphia go. Dover Township New Jersey The contact indicated that Adelphia has never had a problem with franchising. The cable operator was characterized as being good at public relations with very few problems overall. State of New Jersey TMC Review Continued... Customer Service complaints and outages were described as non-existent for the past five years. Hilton Head, South Carolina The City has found it easier to reach upper management of Adelphia than it did with TCI. The past year was described as being a "good experience" and that they would recommend Adelphia to others. Buffalo, New York The City was described as being happy with Adelphia. The operator shows up for appointments when it is supposed to, responds to complaint and outages, and generally runs the system well. Lockport, New York i Committed to California! October 7, 1999 Honorable Mayor and Members of the Hermosa Beach City Council Qnct;rukeEr- •a -rt/ -� SfrfArn leu. Regular Meeting of October 12, 1999 PROPOSAL TO ENACT A MORATORIUM ON THE CONVERSION OF EXISTING COMMERCIAL SPACE TO RESTAURANT SPACE CITYWIDE Recommendation: That the City Council consider whether or not to adopt a moratorium on the conversion of commercial uses to restaurants until the Specific Plan study is completed. Background: This item was discussed at your meeting of September 14, 1999 and continued to this meeting. A separate item, also on this agenda, deals with the Specific Plan development. The attached ordinance has been revised to be a citywide ordinance. Staff is not aware of any applications to change commerical space to restaurant space as of this writing. If adopted by a 4/5 vote, then no additional restaurant uses would be approved while the moratorium is in effect. Respectfully submitt Stephen R. Burrell City Manager s • • ORDINANCE NO. AN ORDINANCE OF THE CITY OF HERMOSA BEACH ESTABLISHING A MORATORIUM ON THE CONVERSION OF EXISTING COMMERCIAL SPACE TO RESTAURANT USE AND DECLARING THE URGENCY THEREOF THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH DOES HEREBY ORDAIN AS FOLLOWS: Section 1. Moratorium declared. Except as otherwise provided in Section 4 hereof, the City of Hermosa Beach hereby declares a moratorium on the issuance of building permits, demolition permits, conditional use permits, variances, zone changes, precise development plans and any other entitlements for the use or development of land which would result in the conversion of commercial space to new or expanded restaurant use in the City. Section 2. Moratorium defined. Except as otherwise provided in Section 4 hereof, notwithstanding any other ordinance or Code of the City of Hermosa Beach, no application for a building permit, demolition permit, conditional use permit, variance, zone change, precise development plan or other permit or entitlement for use for new construction shall be accepted, processed or issued which would result in the creation of new or expanded restaurant space from existing commercial space in the City and no environmental assessment, environmental impact report, negative declaration or categorical exemption shall be prepared in connection with any such permit or entitlement. Section 3. Definition. For purposes of this Ordinance, a "restaurant" shall mean as defined in Section 17.04.050 of the Municipal Code. Section 4. Exemptions. The moratorium or limitation provided for in Sections 1 and 2 hereof shall not be applicable to any of the following: (a) New or expanded restaurant use for which final discretionary permits have been approved prior to the adoption of this Ordinance. (b) Minor changes of a building footprint for an existing building or structure solely for the purpose of providing access for the disabled and if in compliance with applicable zoning and development standards. (c) Minor modifications to an existing building required by law to be constructed in order for the building to comply with applicable fire, building or other safety requirements. (d) Emergency repair or replacement of a structure existing on or before October 12, 1999 and damaged by 990823 Voll\MJ\HBMOR4 • • fire, flood, or other natural causes. (e) Changes in the ownership, name, or operating characteristics of a restaurant existing as of Oc Nothing contained in this section shall exempt or except construction or use exempted by this section from any requirement or regulation of the Building Code, Zoning Ordinance, or other ordinance of the City of Hermosa Beach. Section 5. Relief from Moratorium. The owner of any structure or property may apply to the City Council for relief from this moratorium on the grounds that the structure or property cannot be used for any economic purpose whatsoever absent an exception from this moratorium. Upon receipt of such an application, the City Council shall conduct a duly noticed public hearing, receive and consider the evidence submitted with regard to the application, and exempt the structure or property from this moratorium only if it finds that the structure or property cannot be used for any economic purpose whatsoever unless it is exempted from this moratorium. Section 6. Severability. If any part or provision of this Ordinance, or the application to any person or circumstance, is held invalid, the remainder of the Ordinance, including the application of such part or provision to other persons or circumstances, shall not be effected and shall continue in full force and effect. To this end, the provisions of this Ordinance are severable. Section 7. Penalty. Violation of any provision of this Ordinance shall constitute a misdemeanor and shall be punishable by a fine not to exceed $1,000 or by imprisonment in County jail for not to exceed six (6) months, or by both such fine and imprisonment. Each and every day such a violation exists shall constitute a separate and distinct violation of this Ordinance. In addition to the foregoing, any violation of this Ordinance shall constitute a public nuisance and shall be subject to abatement as provided by all applicable provisions of law. Section 8. Statement of Purpose and Urgency Findings. The City of Hermosa Beach intends to conduct studies forthwith relative to the appropriate distribution of commercial uses in the City, and in particular, to determine whether there exists an overconcentration of restaurants in certain areas to the detriment of other commercial activity. The purpose of this study and any subsequent legislation is to attain the goal of a healthy and diverse business climate in which a wide array of businesses are appropriately distributed. Pending such studies, and the preparation and adoption of the appropriate zoning regulations, it is necessary for the immediate preservation of the public peace, health, safety and welfare that existing and/or new restaurants not capture an even greater share of finite commercial space, which would defeat the very purpose of adopting an ordinance that seeks -2- 990823 Voll\MJ\HBMOR4 . • commercial and retail diversification; consequently, it is necessary that this ordinance take effect immediately. If this ordinance does not take effect immediately, actions might be undertaken which may be in conflict with the ordinance ultimately adopted and commercial square footage may become committed in a way so as to undermine the very purpose of that ordinance. Due to the foregoing circumstances, there is a current and immediate threat to the public health, safety, and welfare. Therefore, it is necessary for the preservation of the public peace, health, safety and welfare that this ordinance take effect immediately. This ordinance is an interim ordinance and shall expire forty-five (45) days after the adoption thereof unless extended pursuant to the provisions of Section 65858 of the Government Code. This is an interim measure, adopted pursuant to the authorization of State law in order to maintain the status quo pending the completion of the studies and adoption of amended zoning regulations, or sooner. It is not a final disposition as to development of any particular parcel of property within the City. PASSED, APPROVED AND ADOPTED this 12th day of October, 1999.. ATTEST: CITY CLERK -3- 990823 Voll\MJ\HBMOR4 MAYOR and PRESIDENT of the CITY COUNCIL • 10 -(2 - October 4, 1999 Honorable Mayor and Members Regular Meeting of of the Hermosa Beach City Council October 12, 1999 SUBJECT: DOWNTOWN SPECIFIC PLAN Recommendation: Direct staff as deemed appropriate Background: On July 20, 1999 the City Council discussed several problems relative to the downtown and directed staff to: • Prepare a list of issues which a downtown specific plan can address. • Provide a schedule for preparing and implementing a downtown specific Analysis: Specific plans are intended to guide specific land use decisions related to use, function, design and operation of an area. Specific plans are adopted by ordinance. They are prepared for commercial or residential areas by adding a new chapter to the Zoning Ordinance and amending the General Plan. The process involves achieving community consensus on the direction for the plan through community meetings and workshops leading to review and formal public hearing by the Planning Commission and City Council. The City currently has several Specific Plan Area (SPA) designations in the General Plan and the Zoning Ordinance relating to both commercial and residential uses though they are parcel specific rather than district specific. Contents of a Specific Plan A downtown specific plan generally contains goals, objectives, policies and programs, a map describing the plan area, definitions of planning terms, a list of permitted, prohibited and limited uses, design standards and operation standards for the plan area. The kinds of regulations found in a downtown specific plan include: • Regulations on building size or bulk. • Specific parking regulations. • Specific use regulations by block or by plan area. • Public improvement plans or policies • Use requirements for encroachments over public property • Operation requirements for special districts such as business improvement districts (BIDS) or special assessment districts. It is also possible to make specific use provision limitations related to new Conditional Use Permits and entertainment permits or to provide for a new zone or uses such as mixed use development. I 7 Co vEr ) Schedule for Preparing, Adopting and Implementing a Specific Plan Processing Steps: Environmental Clearance: Initial Study, Mitigated Negative Declaration Amendment to the General Plan Ordinance (to amend the Zoning Ordinance) Coastal Commission approval (to amend Local Coastal Plan) Tasks 1. Problem identification, research, determination of scope of project, community workshop (whether in-house or with consultant) 2. Preparation of draft Specific Plan with input from workshop 3. Preparation of Initial Study (including analysis, if necessary of traffic impacts, etc.) with recommendation for Mitigated Negative Declaration 4. Planning Commission formal public hearing on and final recommendation 5. City Council consideration, formal public hearing, final action. 6. Submittal to Coastal Commission, Coastal Commission hearing Sol Blumen ld, Director Community ) evelopment Department City Manager H:/specificplan 2 - TIME TO COMPLETE (from start) 3 months 5 months 6 months 7 months 8 months 10 months r • Mayor and Members of the City Council 9 i0 -� October 4, 1999 City Council Meeting October 12, 1999 CERTIFICATION OF RESULTS OF SIGNATURE VERIFICATION OF AN INITIATIVE PETITION PROPOSING TO ESTABLISH RESTRICTIONS AND REQUIREMENTS FOR USE OF THE BEACH FOR TEMPORARY EVENTS AND COMMERCIAL ADVERTISING Attached is a Certificate of Sufficiency for the Initiative Ordinance submitted by petition entitled "An ordinance of the City of Hermosa Beach, California, amending Section 17.030.020 and adding Chapter 17.76 to the City of Hermosa Beach Municipal Code." This sufficiency represents at least 10 percent of the registered voters of the City, according to the report of registration by the County Clerk to the Secretary of State effective at the time the notice of intention was published. With valid signatures from more than 10 percent but less than 15 percent of the registered voters, the petition does qualify to be placed on the ballot at the next regular municipal election (November 2001). COUNCIL ALTERNATIVES: Pursuant to Elections Code Section 9215, the Council has the following options: (a) Introduce the ordinance without alteration at the regular meeting at which it is presented and adopt the ordinance within 10 days after it is presented; or (b) Direct the City Clerk to prepare the documents required to submit the ordinance, without alteration, to the voters at the next regular municipal election occurring not less than 88 days after the date of the order; or (c) Order a report pursuant to Section 9212 at the regular meeting at which the ordinance is presented. When the report is presented to the City Council, the Council shall either adopt the ordinance within 10 days or order an election pursuant to subdivision (b). BACKGROUND: A notice of intention to circulate this petition was filed with the City Clerk on February 1, 1999. As required, the documents were transmitted to the City Attorney for preparation of 1 8 • a ballot title and summary, which were received by the proponent February 18. The notice was published in the Easy Reader February 25, and the petition was then circulated. Multiple petitions were submitted August 16, within the 180 -day time limit, and after the required Clerk's review, were forwarded to the office of the Registrar-Recorder/County Clerk for signature verification, which was completed within the time limit of 30 working days. As required, the matter is now being presented to Council. REVIEW OF ALTERNATIVES: Option (a) — Introduce the Ordinance If the City Council selects Option (a)—to introduce the ordinance without alteration at tonight's meeting—there would be no election on the measure. Because State law requires the subsequent adoption of the ordinance to take place within 10 days, it would be necessary to adjourn tonight's meeting to a date no later than Thursday, October 21, 1999, in order to adopt the ordinance within the State -mandated time limit. Option (b) — Direct that the Measure be Placed on the November 2001 Ballot If the City Council selects option (b)—to direct the City Clerk to bring back, at the appropriate time, the required documents to submit the ordinance without alteration to a vote of the people- all appropriate resolutions would be prepared for Council adoption in June or July 2001, prior to the County deadline for placing items on that November ballot. Option (c) — Order a Report Pursuant to Election Code Section 9212 If the City Council selects Option (c)—to order a report tonight—action on the petition would be deferred until the report is presented, at a date certain as directed by the Council, which must be within the next 30 days (by Tuesda)F, November 9). Pursuant to Elections Code Section 9212, before taking action to either introduce the ordinance or schedule an election, the Council may refer the proposed initiative measure to any City agency or agencies for a report on any or all of the following: 1) its fiscal impact; 2) its effect on the internal consistency of the City's general and specific plans including the housing element, the consistency between planning and zoning, the limitations on City actions under Government Code Section 65008 (Discriminations; prohibition), Chapters 4.2 (Housing Development Approvals) commencing with Section 65913, and Chapter 4.3 (Density Bonuses and Other Incentives) commencing with Section 65915 of Division 1 (Planning and Zoning) of Title 7 (Planning and Land Use); and/or 3) any other matters the Council requests to be in the report. This report shall be presented to the Council within the time prescribed by the Council, but not later than 30 days after the Clerk certifies to Council the sufficiency of the petition. • In order to meet that 30 -day deadline, unless a special meeting is scheduled, the last regular Council meeting at which any report must be presented would be Tuesday, November 9. Once the report is presented, the Council must then either introduce the ordinance (and adopt it within 10 days) or direct the preparation of documents, at the appropriate time, to submit the proposed ordinance to the voters at the next regular municipal election in November 2001. Noted: Ste A City Manager Elaine Doerfling, City Cler Attachments: City Clerk's Certificate of Sufficiency of the petition Letter from County giving results of signature verification Proposed ordinance identified as Exhibit "A" 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 STATE OF CALIFORNIA COUNTY OF LOS ANGELES CITY OF HERMOSA BEACH CERTIFICATE OF SUFFICIENCY Initiative Petition entitled "AN ORDINANCE AMENDING SECTION 17.030.020 AND ADDING CHAPTER 17.76 TO THE HERMOSA BEACH MUNICIPAL CODE," which proposes to establish restrictions and requirements for use of the beach for temporary events and commercial advertising. I, ELAINE DOERFLING, CITY CLERK OF THE CITY OF HERMOSA BEACH, CALIFORNIA, DO HEREBY CERTIFY THAT SAID PETITION IS SUFFICIENT, FOR THE FOLLOWING REASONS: 1. The number of registered voters at the time the Notice of Intention was published, according to the County Clerk's report to the Secretary of State, was 13,428. 2. The number of signatures needed to qualify this proposed initiative for a regular election was at least 10% of the registered voters, or 1,343. 3. The number of signatures needed to qualify this proposed initiative for a special election was at least 150 of the registered voters, or 2,015. 4. The results of the signature verification by the office of the County of Los Angeles Registrar-Recorder/County Clerk are as follows: - Number of signatures filed 2,014 Number of signatures verified 2,014 a. Number of signatures qualified 1,385 b. Number of signatures not qualified 629 c. Percentage qualified (of those filed) 69% THEREFORE, I HAVE HEREUNTO SET THE SEAL OF THE CITY OF HERMOSA BEACH, CALIFORNIA. Elaine Doerfling, Ci.� Clef Dated: October 4, 1999 CONNY B. McCORMACK REGISTRAR•RECORDERICOUNTY CLERK COUNTY OF LOS ANGELES REGISTRAR-RECORDER/COUNTY CLERK 12400 IMPERIAL HWY. - P.O. BOX 1024, NORWALK, CALIFORNIA 90651-1024 September 15, 1999 Ms. Elaine Doerfling, City Clerk City of Hermosa Beach 1315 Valley Drive Hermosa Beach, CA 90254-3885 �3 6= SEP2 91999 —� ON C1.441 gaily .' M�/01eM as.cA vi i Dear Ms. Doerfling: Enclosed are 45 petition sections pertaining to an ordinance which were submitted for signature verification on August 23, 1999. The results of the signature verification are as follows: Number of signatures filed 2,014 Number of signatures verified 2,014 Number of signatures found sufficient 1,385 Number of signatures found not sufficient 629 Not sufficient because duplicate 99 Please call Dorothy Scates, Head of the Data Entry and Signature Verification Section at (562) 462-2376 if you have any questions regarding the signature verification of this petition. Sincerely, • 7c �„ V CONNY B. cCORMACK Registrar-Recorder/County Clerk E:Coord: L_DOERF_91599 • • EXHIBIT "A" INITIATIVE MEASURE TO BE SUBMITTED DIRECTLYTO THE VOTERS Exhibit "A" AN ORDINANCE OF THE CITY OF HERMOSA BEACH, CALIFORNIA, AMENDING SECTION 17.030.020 AND ADDING CHAPTER 17.76 TO THE CITY OF HERMOSA BEACH MUNICIPAL ZONING CODE PROPOSED AMENDMENTTO THE CITY OF HERMOSA BEACH MUNICIPAL ZONING CODE THE CITY OF HERMOSA BEACH COASTAL CONSERVATION ACT The people of the City of Hermosa Beach do ordain as follows: SECTION 1. Title. This ordinance shall be known as, and may be cited as, `The City of Hermosa Beach Coastal Conservation Act." SECTION 2. Findings, Determinations and Declarations. The people of the Gty of Hermosa Beach hereby find, determine, and declare all of the following: (A) Protection and conservation of the public beach is critical to the long-term interests of the people of Hermosa Beach and all Californians. (B) Conserving the open space and natural resources of our beach protects the best known symbol of Hermosa Beach, and preserves the beach for enjoyment of future generations. (C) Pollution of coastal waters, paid admission to temporary events on the beach, commercial sales on the beach, the lack of sufficient public notice thereof, and the excessive amount of temporary events in the coastal zone frustrates the California Coastal Act's purposes of protection of coastal resources and the implementation of Tong -term conservation planning measures and is a negative precedent that represents a continuing threat to the beach in Hermosa Beach and other public beaches in cities along the entire California coast (D) Such temporary events in the coastal zone have the potential for negative impacts upon the following, including, but not limited to: Availability of public access parking opportunities, coastal views and scenic resources, the creation of unlimited temporary commercial advertising on the beach, the creation of litter on the beach and streets, degradation of sea water quality, the creation of excessive noise incompatible with surrounding residential and commercial properties, wildlife, increased traffic congestion and gridlock, increased pedestrian congestion, and the overuse of natural resource areas. (E) Permanent commercial advertising on the beach frustrates the Coastal Act's purpose to preserve coastal views and scenic resources, and its requirements for implementation of long-term conservation planning measures. (F) Therefore the People of the City of Hermosa Beach declare that with the exception of minor participant entry fees such as team participant entry fees, no admission may be charged to any part of the public beach for any reason, including, but not limited to: Temporary events or parts thereof; that no permanent commercial advertising shall be allowed on the sandy beach area, including, but not limited to: Trash cans, tide charts, lifeguard facilities, recreational facilities, and all other public facilities Located on the beach; temporary events in the coastal zone shall be limited, strictly controlled, permits strictly enforced, and subjected to comprehensive monitoring in order to limit and quantitatively and qualitatively analyze the impacts on the following, including, but not limited to: Coastal access parking opportunities, temporary commercial advertising on the beach, coastal views and scenic resources, the overuse of natural resource areas, increased pedestrian and traffic congestion, creation of excessive noise, and the creation of exhaust fumes from generators, and shall mandate adequate and comprehensive mitigation measures in order to reduce all negative impacts to a level of insignificance. (G) The People of The Gty of Hermosa Beach further declare that the Gty shall promote a minimum of four (4) community beach clean-up days during the period May 1 through Sept_ 30 each yeati shall provide funding, proportional to the Gty's responsibility, for the diversion of all storm -drain run-off generated within the city, within the top ten prionties in the city budget each year, with the exception of each year in which a recession has been declared by the Govemor of California, until sufficient facilities exist to effectively and substantially reduce polluted storm drain runoff into the ocean; shall ensure year- round sea -water -quality testing is performed weekly and; shall install and maintain a public notice board at the foot of, or adjacent to the Hermosa Beach Pier for posting notices, including, but limited to: Public notices of proposed temporary events in the coastal zone, local coastal environmental awareness issues and sea water quality testing results. Such notice board shall be no smaller than four (4) feet wide by four (4) feet tall, and shall be operational within ten (10) days of the completion of the Hermosa Beach Pier renovation, or within 90 days of effectivity, whichever comes first. (H) The People of The Gty of Hermosa Beach further declare that in order to pay for long-range conservation measures to protect our open space beach, it is appropriate and necessary to dedicate all revenue except in-kind fees received by the Gty from all temporary events in the coastal zone into a "Coastal Conservation Fund." Therefore, all such revenues, including, but not limited to: Permit fees, exclusive use parking fees, filming fees and other sources of revenue derived directly from temporary events in the coastal zone shall be placed in the Coastal Conservation Fund only. The first priority for Coastal Conservation Fund expenditure shall be one-time compensation for the expedited, permanent, and complete elimination of all permanent commercial advertising located on beach trash cans, tide charts, lifeguard facilities, recreational facilities and all other public facilities located on the beach. Specifically, the agreement with the County of I.os Angeles which provides for permanent commercial advertising on beach facilities in -lieu of direct payment for maintenance services. Once all permanent commercial advertising has been eliminated pursuant to this act, all remaining and future Coastal Conservation Fund revenues shall first be used to ensure year-round weekly sea water quality testing and secondly to establish, enhance and maintain Gty of Hermosa Beach provided permanent recreational equipment on the beach and thirdly shall be used to provide beach maintenance. Any remaining Coastal Conservation Fund revenues shall be used to help fund the diversion of city storm -drain run-off and to help provide for the establishment and maintenance of a non-profit marine research related facility which may be developed on the Hermosa Beach Pier If such a non-profit marine research related facility is approved on the Hermosa Beach Pier it shall be the first priority for revenues from the Coastal Conservation Fund. All permanent co ynercial advertising as identified Page 1 of 6 v herein shall be removed in their entirety by no later than June 1, 2000, or within one hundred eighty (180) days of effectivity, which ever comes first. Current or future revenues in the Coastal Conservation Fund shall not be borrowed or loaned for any reason. Only permanent commercial advertising on County of Los Angeles Lifeguard and maintenance vehicles shall be exempted, excluded, or otherwise waived from the provisions of this act. There shall be no new or expanded permanent commercial advertising located in the LRC -OS zone. (I) The People of The Gty of Hermosa Beach further declare that the actions of a prevailing party in an action brought to enforce the provisions of this act have resulted in a significant public benefit. (J) The Gty of Hermosa Beach has an amended Land Use Plan certified by the California Coastal Commission. (K) The Gty of Hermosa Beach Municipal Code and certified Land Use Plan does not provide adequate controls for the review or management of temporary events in the coastal zone. (L) Therefore, the People of Hermosa Beach declare that the procedures and standards established by this initiative will provide adequate measures to establish sufficient public notice, and reduce and limit the extent of the potential negative impacts of temporary events to a level of insignificance. A Local Coastal Program proposed by the Gty of Hermosa Beach shall incorporate the provisions and intent of this act without modification by the Gty. (M) The People of the Gty of Hermosa Beach further declare that the city shall implement the following land use plan policies: POLICY: 1.A. The city shall maximize the opportunities for using available parking for weekend beach use. POLICY: I.B. The city shall protect on -street parking spaces in the coastal zone which are available to the general public whenever possible and ensure the replacement of such eliminated on - street parking spaces on a one-to-one basis within the city of Hermosa Beach coastal zone within one year. SECTION 3. Purpose and Intent. The purpose and intent of this act is to monitor; preserve and protect the coastal resources within Hermosa Beach, increase public notice, limit the power of the city to expand temporary event commercial development in the coastal zone without voter approval, and to implement and carry out the provisions as identified herein consistent with the Land Use Plan policies, California Coastal Act and the California Code of Regulations. Nothing in this act shall be interpreted to mean the Gty shall have authority to commence Coastal Development Permitting authority unless, and until, the city has a certified Local Coastal Program, or; that the People of The Gty of Hermosa Beach support construction of any new parking structures in the downtown area, or, to limit in any way the ability of the city to react in an emergency, or; to limit in any way the application or enforcement of the California Environmental Quality Act (CEQA). The Qty of Hermosa Beach Municipal Zoning Code is subject to the following modifications to read: (A) Modify Chapter 17 Section 17.030.020 ZONING ("Open Space Zone: Permitted Uses") by DELETING Section (a) and REPLACING it with the following: (a) Public and private parks, not including the beach; (B) Chapter 17 ("ZONING") is hereby amended to add a new zone designated as Long Range Conservation Open Space LRC -OS, Restricted Open Space as follows: Section. 17.76 Long Range Conservation Open Space LRC -OS Section 17.76.010 Purpose and intent. The LRC -OS zone/land use designation is intended to preserve publicly -owned shoreline and sandy beach areas as an open space natural resource subject to long range conservation planning measures, while allowing for passive and active recreational activities, encouraging increasing public access parking opportunities, and preserving the unique character of Hermosa Beach's oceanfront, coastal resources, public views, and access to coastal resources. Section 17.76.020 Permitted uses. Activities in the LRC -OS zone shall range from passive recreational uses such as walking to more intensive, active recreational and cultural uses consistent with the provisions of this act. Section 17.76.030 Improvements permitted. Improvements permitted in the LRC -OS zone shall be as follows: (A) Only non -permanent structures, play equipment, volleyball courts, and softscape shall be permitted. (B) Only non -building public improvements, benches, currently planned or existing public facilities and utilities, erosion and restoration improvements and incidental public service purposes, including, but not limited to: Burying cables and pipes or inspection and maintenance of the pier or intake and outfall lines shall be permitted. Section 17.76.040 Area designated. The public sandy beach from the northerly Qty boundary to the southerly Qty boundary and from the Strand wall and concrete path to the mean tide line shall be designated and zoned LRC -OS. The LRC -OS zone may not be combined with any other zones that lie within the coastal zone or any overlay district In the LRC -OS zone the standards in this act shall take precedent over other standards in the zoning code. The standards in this act shall be applied in a manner which is most productive of public access and coastal resources. Section 17.76.050 Definitions. "Applicant" for the purposes of this act, means any person or his or her authorized representative, entity, corporation or Local Government Agency who applies for, or who is required to apply for, a Park Use Permit and or Coastal Development Permit for a temporary event in the coastal zone; "City" or "City Council" means the Qty or Qty Council of The Qty of Hermosa Beach, California; "Coastal resources" include, but are not limited to, the sandy beach, public access parking opportunities, visitor and recreation facilities, coastal views and scenic resources, water -oriented events, marine resources, biological resources, and environmentally sensitive habitat areas; "Commercial development" for the purposes of this act means a project that involves the exclusive use of coastal resources for a limited duration and or proposes the use of non -permanent structures and or temporary commercial advertising on or above the beach in excess of one hundred square feet, or, a project that includes permanent commercial advertising in the LRC -OS zone; "Cumulatively" or "cumulative effect" means the incremental effects of an individual project when reviewed in connection with the effects of past projects, the effects of other current projects, and the effects of probable future projects; "Event -dependent vehicle(s)" means any motor vehicle or trailer that requires on-site parking in order for the event to function at all; "Exclusive use" means a use that precludes use of the area occupied by the event, for public recreation, beach access or access to coastal waters other than for or through the event itself; "Limited duration" means a period of time which does not exceed an eight day period on a continual basis, including setting up and removing all materials associated with an activity at a site and restoring the site to its preexisting condition, or does not exceed a consecutive four month period on an intermittent basis; "Non -permanent structures" include, but are not limited to; bleachers, perimeter fencing, vendor tents/canopies, judging stands, trailers, portable toilets, sound/video equipment, stages, platforms, movie/film sets, etc., which do not involve grading or landform alteration for installation, with the exception of sand berms in replacement of bleachers; "Pass through(s)" means only those functions in which pedestrians or bicyclists originate outside Hermosa Beach and pass thru the city enroute to a designated location outside Hermosa Beach such as a walkathon; "Permittee" for the purposes of this act, means any person or his or her authorized representative, entity, corporation or Local Government Agency who receives approval for a Park Use Permit and or Coastal Development Permit for a temporary event in the coastal zone; "Sandy beach area" or "Beach" includes publicly owned sandy beach areas fronting on coastal waters, regardless of the existence of potential prescriptive rights or a public trust interest; "Shall" means mandatory; "Temporary commercial advertisement(s)" means the total visible surface(s) of any and all material displayed at and or associated with a temporary event that contains a logo, visual display, or written announcement of a product, service or organization that is sold or operates primarily for profit, which is larger than one (1) square foot, with the exception of: the actual product itself, event -dependent vehicles, umbrellas, chairs, towels and temporary play equipment such as nets and balls. In the case of vehicles on display, it shall mean the entire visible envelope surface of each vehicle. All other commercial advertisement(s) in the LRC -OS zone shall be considered "permanent commercial advertisement(s)" for the purposes of this act and; "Temporary event(s)" or Event(s)"means an event or function of limited duration, including set- up and take-down and restoring the site to its preexisting condition, which includes the use of non -permanent structures that involves development within the meaning of the California Coastal Act, including, but not limited to: Exclusive use of a sandy beach, parkland, pier, filled tidelands, water, streets, sidewalks, bicycle path, or parking area or a portion thereof, which is otherwise open and available for general public use. Section 17.76.060 Temporary events - Regulations. (A) Temporary events within the Qty of Hermosa Beach coastal zone shall be subject to the following regulations. (1) The Parks, Recreation and Community Resources Advisory Commission or its successor shall review each proposed temporary event for which a Park Use Permit and or Coastal Development Permit is required on an event -by - event basis consistent with the procedures set forth in this act at a duly noticed public hearing, and make recommendations" to the Qty Council for denial or approval as proposed, or as modified at a duly noticed public hearing. (2) Priority shall be given to temporary events that require the coast in order to function at all, such as surfing events. (3) The Parks, Recreation and Community Resources Advisory Commission and the Qty Council shall not consider a permit for a period of three (3) years from the date of application for any temporary event whose applicant or responsible party has performed any of the following: (a) Failed to mitigate all impacts from the same or substantially similar previous temporary event in the coastal zone to a level of insignificance upon completion of the mitigation and monitoring program including extensions, if any; (b) Commenced development of a temporary event in the coastal zone without a valid permit issued as required pursuant to this ordinance. (4) Temporary events held on the beach whose primary function is live amplified music shall be treated generically without regard to the applicant's identity and the city shall be the responsible party for compliance to mitigation conditions of the permit. Monitoring of sound, off- site mitigation parking lots and traffic conditions in the area of the event shall be performed by an independent third party. (5) Temporary commercial advertising in the LRC -OS zone must be associated with a current temporary event and shall be attached to a structure and shall not be set on the sand or attached to any recreational facility on the beach in such a way as to replace the recreational facility primarily for commercial purposes. No mechanical or electronic advertising device shall be allowed in the LRC -OS zone. (6) Each proposed event with an expected or known attendance of 500 or more participants and spectators on any day shall have at least one person available at all times in an identified central location to answer questions and log and respond to complaints. The original log shall be signed by the applicant and provided to the city manager and included in the permanent record in an expedited manner. (7) Temporary events in the coastal zone with an expected or known attendance of 1000 or more participants and spectators on any day shall not be combined or held concurrently. (8) Temporary events held on the beach shall not provide for areas which are exclusive access or VlPareas except for documented security reasons. (9) No sales of any kind shall be allowed on the sandy beach, with the exception of constitutionally protected materials only, with specific approval. (10) The applicant shall be given a copy of, be responsible to know the contents thereof, and comply with the Hermosa Beach noise ordinance as applicable. (11) All parking lots in the City's Preferential Parking Program shall be protected from use by temporary events, and shall not be used as off-site parking mitigation lots for any events. The City shall provide for the posting of signs in these lots which discourage exclusive event parking at least twenty-four (24) hours in advance and shall monitor each lot during events for which 1500 or more people are expected to attend on any day, in order to determine the impact of each event on these lots. Lots found to be occupied ninety percent (90%) or greater by 9:55 a.m. during an event on weekend days or holiday days shall require an attendant with specific instructions to park beachgoers and visitors to public facilities only. Information shall be provided to direct event patrons to the remote lots. Any exception from this requirement shall require California Coastal Commission approval. (12) Temporary events in the coastal zone during the period of May 1 through September 30 with an expected or known attendance of 1500 or more participants and spectators on any day which occur during weekend days and or holiday days shall be subjected to comprehensive monitoring as follows: (a) A comprehensive monitoring program shall be established to quantitatively and qualitatively analyze the impacts of each proposed temporary event on the following, including, but not limited to: Coastal access parking opportunities, coastal views and scenic resources, temporary commercial advertising in the LRC -OS zone, the overuse of natural resource areas, increased pedestrian congestion, increased traffic congestion, parking impacts on residents and businesses, creation of excessive noise, and exhaust fumes from generators, and shall direct mandatory comprehensive mitigation measures for each event, including subsequent events, to reduce all negative impacts to a level of insignificance. (b) The monitoring shall be conducted each weekend and or holiday during the event for the first three occurrences of an event in order to determine if the impacts have been mitigated to a level of insignificance, or upon a finding of cause by the City Council, which shall be set forth in full in a resolution, may be extended on an event -to - event basis for a maximum of two (2) events or two (2) calendar years thereafter, whichever comes first, in order to determine if the impacts can be specifically found by the City Council, based on the evidence submitted, to have been reduced to a level of insignificance, and shall be set forth in full in a resolution. Each monitored item shall be documented as clearly as possible, including, but not limited to: Logs, reports, photographs, video tape/film, printouts, public parking surveys and other documented proof. The monitoring shall include a program which determines the actual number of attendees who require parking in order to attend the event. Events whose monitoring proves less off-site parking is required may be adjusted to more accurately reflect the actual parking requirement. Limited monitoring shall continue in perpetuity to ensure compliance with off-site parking -usage permit conditions which reduce negative parking impacts to a level of insignificance. (c) Monitoring of traffic conditions in the area of the event and of each off-site parking lot usage shall be conducted by a qualified professional independent third party. (d) Temporary event applicants or responsible parties who have failed to mitigate all impacts to a level of insignificance during the mitigation and monitoring program, including extensions if any, and have not applied for a permit for a temporary event in the coastal zone during the last three (3) years, not withstanding any other provision of this act, may be considered for a permit provided that the applicant or responsible party agrees in writing to a one (1) time mitigation and monitoring program, and understands and agrees that no further permits shall be issued for the event, or substantially similar event, or the applicant or responsible party, if all impacts are not mitigated to a level of insignificance. (13) Temporary events in the coastal zone shall comply with all findings as provided for in Section 17.76.080 Findings - Temporary Events. (14) Temporary events in the coastal zone occurring during the period of May 1 through September 30 shall require a written post -event final comprehensive report ("Final Report") in the form of an affidavit attesting to the truth, accuracy and completeness of the information contained therein, submitted within thirty (30) calendar days of the conclusion of the event, which shall include, but not be limited to: the permit conditions and all aspects of compliance with each condition, peak attendance times and number of attendees, off-site parking utilization, traffic conditions in the area of the event, radio scripts including quantity, date and time of airing, locations of professionally printed signs directing traffic, and event temporary commercial advertising documentation. Failure to submit a Final Report within forty (40) calendar days of the conclusion of the event shall cause denial of all future permits for temporary events to the applicant and his or her authorized designee. (15) A Park Use Permit and or Coastal Development Permit shall be required for temporary events in the coastal zone for which any one of the following apply: (a) A temporary event with an anticipated or known total attendance of 500 or more participants and spectators between the hours of 930 am and 7:00 p.m. on any day. (b) A temporary event which involves the closure or exclusive use of more than 20 public parking spaces in the coastal zone, or involves the issuance of more than 20 temporary parking passes for use of public parking spaces in the coastal zone. (c) A temporary event which involves the closure of the Hermosa Beach Pier to the general public. (d) A temporary event of which any part is held on a beach area which proposes the display of temporary commercial advertisement in excess of one hundred (100) square feet on or above the beach. (e)A temporary event held on a sandy beach area, which exceeds 48 hours in duration including set-up and take-down and restoring the site to its preexisting condition. (f) A temporary event, which in conjunction with other planned or approved temporary events on the same day, would cause the closure of any public parking lots in the coastal zone, the closure of the Hermosa Beach Pie; the closure or exclusive use of more than 20 public parking spaces in the coastal zone, or cumulatively create anticipated or known attendance of 500 or more participants and spectators between the hours of 9:30 am. and 7:00 p.m. on any day. (g) A temporary event that proposes live amplified music on the beach. (16) All temporary events not subject to the above Park Use Permit and or Coastal Development Permit requirements shall be exempt from Park Use Permit and or Coastal Development Permit requirements, with the following exceptions: (a) The Director of Community Development shall require a Park Use Permit and or Coastal Development Permit for those temporary events which have the potential to directly or indirectly impact the following: coastal access parking opportunities; coastal views and scenic resources; coastal resources; environmentally sensitive resources; and rare or endangered species. (b) The International Surf Festival operated by the Beach Cities Health District, pass through(s) and the Saint Patricks Day Parade not including it's associated street vending, shall be the only temporary events exempted, excluded, or otherwise waived from obtaining a Park Use Permit and or Coastal Development Permit, provided that the event•does not propose temporary commercial advertisement(s) exceeding one thousand (1000) square feet on and or above the beach, and is operated in a manner consistent with the 1998 event and with the provisions, policies and standards of this act, the Land Use Plan and or Local Coastal Program adopted by the Gty. This section shall not affect the application of use fees. (c) The Director of Community Development shall issue a Notice of Determination for each temporary event which is determined to be exempt from Park Use Permit and or Coastal Development Permit requirements under Section 17.76.060.A.16. On the day that the Notice of Determination is issued, it shall be posted in the calendar or binder and website required by Section 17.76.060.A.19, and a copy shall be sent to the California Coastal Commission office at least sixty (60) days prior to commencement of the proposed temporary event. Unless a challenge is received in the Community Development Directors office pursuant to Section 17.76.100 within ten (10) city hall working days of receipt by the California Coastal Commission office, the determination shall be deemed final. (17) Park Use Permits and or Coastal Development Permits for temporary events issued Page 3 of 6 ti pursuant to this act shall be subject to and processed in conformance with CEQA all applicable policies and provisions set forth in this act and the policies and provisions of the Land Use Plan and or Local Coastal Program. The calendar or binder and website required by Section 17.76.060.A.19 shall be used to track all temporary events. (18) The Director of Community Development shall inspect the temporary event during the monitoring and mitigation period for strict permit compliance during the event's highest attendance period and keep a detailed written record for the permanent files of the case. Any deviation from the approved permit must be in writing and reviewed and approved prior to commencement by the Director of Community Development and shall be minor in nature. The Director of Community Development or his or her designee shall create a user-friendly guide designed to help applicants and others understand and utilize the temporary event permitting process. (19) The Gty Manager or his or her designee shall keep a calendar or binder and electronic website continuously on the computer intemet/world wide web for public review that describes the location, duration, and number of participants and attendees of all approved temporary events and all events that have been proposed. The calendar or binder and website shall provide for electronic mail, phone numbers and addresses for correspondence, and shall contain summaries of all complaints, Coastal Conservation Fund balances, indicating where the revenue has been spent each year and to date, a list of the total square footage of temporary commercial advertising allowed on the beach individually and cumulatively from events each year, all relevant reports and photographs, and all Notices of Determinations (exemptions) and Park Use Permits and or Coastal Development Permits issued for all temporary events during the preceding 24 months. In addition, the Gty Manager or his/her designee shall place in the calendar or binder and website within two (2) working days of receipt from the Los Angeles County Department of Beaches and Harbors, all copies of applications for Beach/Harbor Use Permits forwarded by the County. In addition to the website, the calendar or binder shall be available for immediate public review at a public counter in Gty Hall and or in the public Library during normal business hours without having to submit a Request for Public Records Form or any other form. Section 17.76.070 Standard Conditions. (A) The following standard conditions shall be applied to all applications and Park Use Permits and or Coastal Development Permits for temporary events held in the coastal zone: (1) NOTICE OF RECEIPT AND ACKNOWLEDGMENT. The permit is not valid and development shall not commence until a copy of the permit, signed by the permittee or authorized agent, acknowledging receipt of the permit and acceptance of the terms and conditions, is returned to the Community Development Department at least thirty (30) calendar days prior to commencement of development. Late submittal will result in denial of permit issuance. (2) EXPIRATION. If development has not commenced, the permit will expire on the last day of the approved Park Use Permit and or Coastal Development Permit temporary event date. (3) COMPLIANCE. All development must occur in strict compliance with the proposal as set forth in the application for permit, subject to any special conditions set forth in the permit Any deviation from the approved permit must be in writing and reviewed and approved prior to commencement by the Director of Community Development. (4) INTERPRETATION. Any questions of intent or interpretation of any condition will be resolved in writing by the Community Development Director. (5) INSPECTION. The Community Development Director shall be allowed to inspect the site for permit compliance. (6) ASSIGNMENT. The permit may be assigned to any qualified person, provided assignee files with the City an affidavit accepting all terms and conditions of the permit Section 17.76.080 Application Requirements - Temporary Events. Application for temporary events requiring a Park Use Permit and or Coastal Development Permit shall be made to the Department of Community Development on forms provided by the Director of Community Development. The application for a Park Use Permit and or Coastal Development Permit shall be accompanied by: (A) A complete description of the proposed temporary event, including, but not limited to: (1) The proposed dates and hours of operation of the proposed temporary event, including set-up and take-down and restoring the site to its preexisting condition; (2) The estimated or known daily and total attendance at the proposed temporary event, including event organizers, sponsors, participants and spectators. Include materials or procedures used to determine the estimated and or actual attendance figures, such as serialized wrist bands, questionnaires, surveys or records and photographs of prior events; (3) A parking and traffic control plan and a description of the measures proposed to mitigate the proposed temporary event's impact on traffic circulation in the area of the event and on the public parking supply in the coastal zone to a level of insignificance; (4) A description of the impact of amplified sound from the proposed temporary event. The submittal shall include a description of the measures proposed to mitigate the potential impact to a level of insignificance; (5) A description of all events ancillary to the proposed temporary event, and/or "pre -events" or "post -events"; (6) A description of the location of the proposed temporary event, the amount of sandy beach area to be used, the number of public parking spaces in the coastal zone to be occupied or used, and a description of ingress and egress to the Pier and the adjacent areas; (7) A description of any other potential negative impacts from the proposed temporary event on residents and businesses and a description of the measures proposed to mitigate the potential negative impacts to a level of insignificance; (8) A description of any potential impacts from the proposed temporary event on public services and a description of the measures to mitigate these potential impacts to a level of insignificance; (9) A description of any other potential negative impacts from the proposed temporary event on residents and businesses and a description of the measures proposed to mitigate these potential impacts to a level of insignificance; (10) A description of any potential impacts from the proposed temporary event on the general public's ability to access the beach, Pier, bicycle path, public parking, public streets, sidewalks, walkstreets, volleyball courts, and or other access support facilities which may be identified in the Land Use Plan and or Local Coastal Program. The submittal shall include a description of the measures proposed to mitigate these potential impacts to a level of insignificance; (11) Adescription of the daily total square footage of temporary commercial advertising proposed and its locations. Temporary commercial advertising shall be minimized. (12) A vicinity map, site plan and elevations showing the location of the proposed temporary event in relation to the Pier, bicycle path, surf zone, public parking facilities, vertical beach accessways, and recreation facilities. The site plan and elevations shall describe and identify the size, maximum height from sand surface at the mean high tide line and location of all objects proposed to be placed at the site of the proposed temporary event, including, but not limited to: Fences, structures, barriers, bleachers, seating areas, activity areas, tents, booths, canopies, vendors, stages, judging stands, platforms, sets, sound equipment, vehicles, trailers, generators, toilets and temporary commercial advertisements. The site plan shall also indicate whether any existing objects are proposed to be altered or removed from their current location. Generator use shall be minimized. (13) Address labels supplied by the City for all interested parties, and all property owners, residents, tenants, lessees, and businesses within a 500 foot radius of the parcel on which the event is proposed, or within a 500 foot radius of the maximum extent of the proposed temporary event site, whichever results in a greater area. (D) Evidence that the applicant has posted a notice in a conspicuous location at the site of the proposed event that clearly stated the applicant's intent to apply for a Park Use Permit and or Coastal Development Permit for a temporary event The posted notice shall contain a description of sufficient detail of the proposed temporary event, including, but not limited to: Proposed location and activities, dates and times including set-up and tear -down and restoring the site to its preexisting condition, expected or known attendance, and off- site parking and transportation accommodations. (E) The required application fee. (F) Any additional information determined by the Director of Community Development to be necessary for the evaluation of the proposed event. (G) A dated signature by or on behalf of each of the applicant's, attesting to the truth, completeness, and accuracy of the contents of the application, and if the signer is not the applicant, written evidence that the signer is authorized to act as the applicant's representative. Section 17.76.080 Findings - Temporary Events. All City Council decisions on Park Use Permits and or Coastal Development Permits for temporary events in the coastal zone shall be accompanied by written findings. A Park Use Permit and or Coastal Development Permit for a temporary event shall be approved either as applied for, or as modified, only if all the following applicable findings can be specifically supported: (A) The staging of this temporary event will not result in more than one thousand (1000) total square feet of commercial advertising on the beach or suspended above the beach by any means, and the applicant and his or her commercial sponsors has agreed in writing, which is on file with the city, to not provide for any aerial (aircraft) banner advertising during the event; (B)If the event's primary location is not located on the sandy beach, no temporary commercial advertising is proposed to be located in the LRC - OS zone; (C) The temporary event, as described in the application and accompanying materials, as modified by any conditions of approval, conforms with this act, the Land Use Plan policies, and or Local Coastal Program; (D) The temporary event, as described in the application and accompanying materials, as modified by any conditions of approval, is in conformity with the public access and recreation policies of Chapter 3 of the Coastal Act of 1976 commencing with Section 30200 of the Public Resources Code and CEQA, and specifically; (1) The applicant or his or her authorized representative has signed his or her name indicating he or she has been given a copy of this act and that he or she understands and agrees to its terms and conditions, a copy of which is on file with the Gty; (2) The event does not physically block or prohibit access to the shoreline, vertical beach accessways, Pier, or bicycle path by the general public or impose conditions on the public for access to the same. A specific requirement for a minimum fifteen (15) foot wide access way to the Pier is included in the Park Use Permit and or Coastal Development Permit as a condition of approval; (3) The event includes a parking plan which minimizes exclusive use of public parking spaces in the coastal zone by allowing the exclusive use of public parking spaces in the coastal zone for event -dependent vehicles only and requires event/vendor vehicles to preserve the most convenient off-site parking lot spaces for event patrons. A specific description of the parking plan is included in the Park Use Permit and or Coastal Development Permit as a condition of approval; (4) The temporary event, including all set-up and take-down days and restoring the site to its preexisting condition, does not exceed an eight (8) day period, and set-up and take-down time is minimized; (5) If the event requires the use of more than 20 public parking spaces in the coastal zone, the parking spaces are replaced at a minimum one-to- one ratio in off-site parking lots open for use by the general public, and adequate free transportation capacity during peak event and beach access hours is provided between the replacement parking spaces and the intersection of Hermosa Avenue and Pier Avenue or other locations as necessary to assure that the off-site parking effectively serves event and public beach access, and off-site parking usage is maximized and measured. A specific description of the replacement parking and transportation program and is included in the Park Use Permit and or Coastal Development Permit as a condition of approval; (6) If the expected or known attendance of the event equals or exceeds 500 persons between the hours of 9:30 a.m. and 7:00 p.m.. on any day, measures to effectively serve beach access are provided, including, but not limited to: Previous Park Use Permit and or Coastal Development Permit requirements, valid lease or licensing agreements for sufficient alternate off-site free parking at a minimum of one space for every three people in excess of 500 persons, a free beach shuttle service, and an interim traffic control plan. Such measures shall be adequately publicized by requiring use of the City's street banner facilities on Pacific Coast Highway and Pier Avenue and other locations as may be necessary to direct traffic to the off-site parking. If the expected or known attendance of the event and or concurrent events equals or exceeds 1500 persons between the hours of 9:30 am and 7:00 p.m. on any day, the permit also requires use of all other city street banner facilities to direct traffic to the off-site parking, signs, radio and other measures required by this act, the Community Development Director, the Gty Council or the California Coastal Commission. Events whose monitoring proves to a reasonable certainty that more, or less, off-site parking is required, may be adjusted to more accurately reflect the actual parking requirement. All methods of advertising the event shall specifically state in large block letters no smaller that the largest type used, that there is no spectator parking at the event, and indicates the location of all off-site parking with free handicap -accessible beach shuttle service available to the general public and the headway time. A specific description of the measures to be used are included in the Park Use Permit and or Coastal Development Permit as conditions of approval; (7) The cumulative effects of the event, in conjunction with other past, concurrent, or future planned temporary events, or other future temporary events that could be reasonably known to occur during the period commencing May 1 and ending through September 30, will not result in any temporary events which require a Park Use Permit and or Coastal Development Permit occurring in the coastal zone on the weekend, spaced less than two (2) weekends between events, or during more than two (2) of the three (3) peak holiday coastal access periods of Memorial Day weekend, the July 4th weekend or weekdays as observed, and the Labor Day weekend through Monday, and will not result in back-to-back weekend temporary events, nor provide for any repeat weekend temporary events during the period, and will not result in any temporary events occurring in the coastal zone on the weekend, spaced less than three (3) weekends between events, during the rest of the calendar year; (8) The permit requires an applicant signed Final Report on a form provided by the Community Development Department which shall be filed with the Community Development Department no later than thirty (30) calendar days from the conclusion of a temporary event, and shall include, but not be limited to: Documented usage of off-site parking spaces indicating total number of vehicles parked per day and the number expected, total number of shuttles departing the lot(s) per day, shuttle departure times, number of passengers each, and total number of passengers per day; the location, size, quantity and content of professionally produced signs and banners directing the public to the off-site parking lots and for traffic control; number of spectators and participants per day and total for the event; actual total square feet of temporary commercial advertising displayed including photographs of each different temporary commercial advertisement indicating their square footage and quantities of each for each day; traffic conditions in the area of the event, and all other aspects of permit compliance. A specific description of the measures to be used are included in the Park Use Permit and or Coastal Development Permit as conditions of approval; (9) If the temporary event is expected or known to have 1,500 or more spectators and participants between the hours of 9:30 a.m. and 7:00 p.m. on any day, the applicant additionally provides a valid agreement with a shuttle operator; shuttle routes and operating schedule to provide such a shuttle service during the event as follows: the shuttle service shall run continuously on Saturdays, Sundays and holidays between the hours of 7 am. and 7 p.m.; the "headway" time between shuttle service pick-ups shall not be more than fifteen (15) minutes; and the free shuttle service is available and identified as for the general public, handicap and event spectators. Specifically, the shuttle service provides for adequate transportation capacity during combined peak event and beach access hours; (10) If the temporary event is expected or known to have 1,500 or more spectators and participants between the hours of 9:30 am. and 7:00 p.m. on any day, additional measures are required which provide for recycling facilities; a method to determine the actual number of attendees requiring parking in order to attend the event; and provides for a minimum utilization requirement of forty (40) percent of the off-site parking mitigation spaces required during the first event approved pursuant to this act, increasing by an amount to be determined by the Qty Council but not less than a minimum of ten (10) percent for each event thereafter to a minimum of seventy (70) percent utilization by the completion of the monitoring and mitigation program not including extensions regardless of changes to the minimum off-site parking mitigation spaces required. Radio notices Informing the public of alternate parking and transportation will be aired a minimum of one day prior to the weekend event date during commuter hours and once an hour during the event on weekends and or holidays between minimum hours of 9 am. to 1 p.m. and shall represent all diverse ethnic and cultural Los Angeles radio markets and shall include Spanish language, youth and news stations. A specific description of the measures to be used are included in the Park Use Permit and or Coastal Development Permit as conditions of approval; (11) A true, correct and complete copy of all information regarding the current and past events conducted by the applicant within the last two (2) years or two (2) events, which is on file with the Qty, including, but not limited to: The permanent case files, all Final Reports with all attachments and exhibits has been presented for public review during each hearing; (12) The Park Use Permit and or Coastal Development Permit requires strict compliance with permit requirements and standard conditions as conditions of approval; (13) Nothing is proposed to be offered for sale on the sandy beach, with the exception of constitutionally protected materials with specific approval; (14) If the temporary event is on the beach and its primary function is live amplified music, the city accepts primary responsibility for compliance to permit mitigation conditions. Additionally, amplified sound is measured by a qualified professional independent third party during the monitoring and mitigation period; (15) If the temporary event is expected or known to have 1,500 or more spectators and participants on any day, notice of an application for a Park Use Permit and or Coastal Development Permit has been published in a local newspaper of general circulation; (16) Amplified sound equipment is directed opposite the residential and commercial properties; (17) Notice has been given to all addresses within a 500 foot radius of the parcel on which the event is proposed, or within a 500 foot radius of the maximum extent of the proposed temporary event site, whichever results in a greater area, at least 10 working days prior to the first scheduled public hearing; (18) The proposed temporary event has been reviewed by the Parks, Recreation and Community Resources Advisory Commission consistent with the procedures set forth in this act at a duly noticed public hearing; (19) The replacement parking does not include any parking lots that provide long-term beach and public facility parking during -the facilities regular business hours, or are included in any preferential parking program; (20) If the initial monitoring and mitigation period has been completed, all impacts from the applicants prior temporary event have been found, based on the evidence submitted, to have been reduced to a level of insignificance; (21) The proposed temporary event is not the same or substantially similar event conducted by the applicant within the last three (3) years which failed to mitigate its impacts to a level of insignificance upon completion of the monitoring and mitigation period including extensions, if any; (22)If tobacco and or alcohol temporary commercial advertising is proposed; it is in the best interest of the general public (Effective January 1, 2002 and thereafter); (D) All feasible mitigation measures and conditions to the Park Use Permit and or Coastal Development Permit have been adopted to reduce any adverse impacts of the proposed event to a level of insignificance. Section 17.76.090 Acceptance of terms. (A) The Community Development Director shall receive a copy of the Park Use Permit and or Coastal Development Permit signed by the permittee or his or her authorized representative, agreeing to the terms and conditions of the permit at least thirty (30) calendar days prior to commencement of development. (B) Failure of the permittee to submit a signed Park Use Permit and or Coastal Development pursuant to Section 17.76.090.A shall cause the permit to automatically become invalid. Section 17.76.100 Qty Council action final. Page 5 of 6 (A) The action of the Qty in denying an application for a Park Use Permit and or Coastal Development Permit for a temporary event shall be final and conclusive, and may not be appealed to the Qty. (B) The action of the Qty in approving an application for a temporary event Park Use Permit and or Coastal Development Permit or issuing a Notice of Determination for a temporary event in the coastal zone shall be final and conclusive unless, on or before the 10th city hall working day following the decision of the Qty, an appeal in writing on forms provided by the Director of Community Development is filed with the City and or the Coastal Commission, as applicable, by the applicant. Section 17.76.110 Appeal - Temporary Events (A) Development authorized under this act shall be appealable to the Qty Council and or the Coastal Commission as applicable. (B) Any person or representative who appeared at a public hearing, or by other appropriate means prior to action on a Park Use Permit and or Coastal Development Permit for a temporary event, informed the Qty of his or her concerns about an application for such permit, or any person who, for good cause, was unable to do either of the foregoing objects to the action taken on such permit and wishes to appeal such action to the Qty Council and or Coastal Commission as applicable, is a qualified appellant and may appeal an action of the Qty Council in approving a Park Use Permit and or Coastal Development Permit for a temporary event to the Qty Council and or Coastal Commission as applicable. (C) There shall be no fee associated with an appeal to the Qty Council of an approved Park Use Permit and or Coastal Development Permit for a temporary event in the coastal zone. (D) The appeal shall state the grounds on which the appeal is being made. The grounds for appeal must be based on any of the following: The provisions and or policies of this act, the Municipal Code, the Land Use Plan and or Local Coastal Program, or the Coastal Act. (E) The decision of the Qty Council on the appeal shall be supported by findings, and shall be set forth in full in a resolution. A copy of the decision shall be sent to the applicant and appellant. The action of the Qty Council shall be final and conclusive unless appealable to the California Coastal Commission. Section 17.76.120 Effective Date of Decision. Development pursuant to an approved Park Use Permit and or Coastal Development Permit shall not commence until the permit becomes effective. Not withstanding any other provision of this act, the permit becomes effective only if all applicable appeal periods expire or; if appealed, until all appeals, including those to the Coastal Commission, if any, have been exhausted. Section 17.76.130 Applications and case file a part of permanent record. (A) Applications filed pursuant to this act shall be numbered consecutively in the order of their filing and shall become a part of the permanent official records of the Qty Council, and there shall be attached thereto and permanently filed therewith copies of all case files, including, but not limited to: Final Reports, correspondences in all forms, exhibits, notices and actions with certificates or affidavits of compliance, posting, mailing or publications pertaining thereto. In addition, all electronic communications shall be saved, printed out and made a part of the permanent files of the case. (B) A detailed summary prepared by the city clerk or deputy city clerk of all pertinent testimony offered at each public hearing held in connection with an application for a Coastal Development Permit for a temporary event filed pursuant to this act, and the names of persons testifying shall be recorded and made a part of the permanent files of the case. (C) A copy of all approved applications for a Park Use Permit issued pursuant to this act shall be sent to the Coastal Commission for determination of Coastal Development Permit requirements at least sixty (60) days in advance, until such time as the Gty has a certified Local Coastal Program that includes the provisions of this act. Section 17.76.140 Setting of hearing. All applications for a Park Use Permit and or Coastal Development Permit for a temporary event, shall be set by the clerk of the city council for a duly noticed public hearing when such hearing is to be held before the Gty Council and or the Parks, Recreation and Community Resources Advisory Commission. The date of the hearing shall be not less than ten working days nor more than forty (40) calendar days from the time of filing of such verified application. Copies of all documentation and information submitted for permit consideration shall be available for public review at a counter in city hall and the public library during regular business hours at least three (3) city hall working days in advance of each public hearing and shall be made available in the packet at the hearing. Section 17.76.150 Investigations. The Gty Council shall cause to be made by its own members, or members of its staff, such investigation of facts bearing upon an application or appeal of a Park Use Permit and or Coastal Development Permit set for hearing, including, but not limited to: An analysis of previous temporary events conducted within the last two (2) years or two (2) events by the applicant, as will serve to provide all necessary information to assure action on each case consistent with the purposes of this act. Section 17.76.160 Violations. It shall be unlawful for any person, entity, corporation, or Local Government Agency to erect, construct, or begin commencement of a temporary event in the coastal zone whose application for a Park Use Permit and or Coastal Development Permit is required pursuant to this act, or cause or permit the same to be done in violation of this act, or to erect, construct, or begin commencement of a temporary event in the coastal zone without a valid Park Use Permit and or Coastal Development Permit. Any such person, entity, corporation, or Local Government Agency shall be guilty of a misdemeanor and upon conviction thereof shall be punishable as set forth in Section 17.76.170. Section 17.76.170 Violations - Penalties. (A) Every person, entity, corporation, or Local Government Agency who violates Section 17.76.160 is guilty of a misdemeanor and shall be punishable by a fine not exceeding one thousand dollars ($1,000.00) or by imprisonment in the City or County jail for a term not exceeding six (6) months or by both such fine and imprisonment. Each such person, entity, corporation, or Local Government Agency shall be guilty of a separate offense for each and every day during any portion of which any such violation is committed, continued, or permitted by such person and shall be punishable accordingly. (B) The application of the above penalty shall not be held to prevent the enforced removal of prohibited conditions. Section 17.76.180 Fines deposited in Coastal Conservation Fund. All revenues received by the City from fines pursuant to this act shall be deposited into the Coastal Conservation Fund established by this act. Section. 17.76.190 Temporary event revenue deposited in Coastal Conservation Fund. All revenue received by the Gty from temporary events in the coastal zone, including, but not limited to: Park use fees, filming fees, exclusive use parking fees and other sources of revenue derived directly from said events shall be deposited directly into the Coastal Conservation Fund only. SECTION 4. Initiative Integrity. (A) This act shall be broadly construed and applied in order to fully promote its underlying purposes, and to be consistent with the United States Constitution, the Constitution of the State of California and the California Coastal Act. If any provision of this initiative conflicts directly or indirectly with any other provisions of law of the Gty of Hermosa Beach, or if any ordinance which is adopted concurrently with this ordinance which receives less votes and is in direct or indirect conflict with any provisions herein, it is the intent of the voters that those other provisions are repealed to the extent of the inconsistency and such inconsistencies shall be of no force and effect. (B) All ordinances, agreements, resolutions, and policies of the Gty of Hermosa Beach and the provisions and policies of the Gty of Hermosa Beach Municipal Code, Land Use Plan, Land Use Element of the General Plan, and the official zoning map which is in direct or indirect conflict with the intent and provisions herein are repealed to the extent of the inconsistency. (C) No provisions of this act or part thereof may be modified, amended, or repealed without a vote of the electorate, except as provided herein, and by the California Coastal Commission in order to comply with the minimum requirements of the California Coastal Act for consideration of a Local Coastal Program proposed by the Gty of Hermosa Beach. (D) If any provision of this act or part thereof, or section, paragraph, sentence, clause, word or phrase of this act is, for any reason, held to be invalid, ineffective, unenforceable, or unconstitutional by any final court action in a court of competent jurisdiction, or by the California Coastal Commission, or by reason of any preemptive State of California or Federal legislation, the remaining provisions, sections, paragraphs, sentences, clauses, words or phrases hereby adopted shall remain in full force and effect; it being expressly declared that this act and its provisions, and each section, paragraph, sentence, clause, word and phrase hereof, would have been prepared, proposed, adopted, approved and ratified irrespective of the fact that any one or more provisions, or sections, paragraphs, sentences, clauses, words or phrases be declared invalid, ineffective, unenforceable, or unconstitutional. (E) It is the will of the People of The City of Hermosa Beach that any legal challenges to the validity of any provision of this act be acted upon by the courts upon an expedited basis. SECTION 8. The Planning staff and Planning Commission is hereby authorized and directed to make any and all nonsubstantitive modifications consistent with the intent and provisions herein which are necessary to codify this act into existing Gty of Hermosa Beach Municipal Codes. Any other changes shall be limited to: Reformatting and revising chapter and section numbers and amending references to other Municipal Code sections to the extent of the inconsistency. The Planning staff and Planning Commission shall expedite compliance. SECTION 9. The Gty Council of The Gty of Hermosa Beach shall expedite approval of a Local Coastal Program which includes the provisions of this act without modification, and seek Coastal Commission approval and certification and take all further actions necessary to expedite implementation and enforcement of the provisions and intent of this act. SECTION 10. This initiative measure is to be adopted by the Gty Council of Hermosa Beach or be submitted to the voters at the next succeeding municipal election or at a special election as provided for by law. Page 6 of 6 SECTION 11. This act shall take effect the day after the election, or in the manner prescribed by law. SECTION 12. The City Clerk shall certify to the adoption of this ordinance and shall cause the same to be published in the manner prescribed by law. r Mayor and Members of the City Council efik4-0-e_ ACi. c._ October 4, 1999 City Council Meeting October 12, 1999 CERTIFICATION OF RESULTS OF SIGNATURE VERIFICATION OF AN ' INITIATIVE PETITION PROPOSING TO ESTABLISH LIMITS ON THE NUMBER OF CONSECUTIVE TERMS WHICH MAY BE SERVED BY CITY COUNCIL MEMBERS Attached is a Certificate of Sufficiency for the Initiative Ordinance submitted by petition entitled "An ordinance of the City of Hermosa Beach, California, adding Sections 2.08.040 and 2.08.050 to the City of Hermosa Beach Municipal Code." This sufficiency represents at least 10 percent of the registered voters of the City, according to the report of registration by the County Clerk to the Secretary of State effective at the time the notice of intention was published. With valid signatures from more than 10 percent but less than 15 percent of the registered voters, the petition does qualify to be placed on the ballot at the next regular municipal election (November 2001). COUNCIL ALTERNATIVES: Pursuant to Elections Code Section 9215, the Council has the following options: (a) Introduce the ordinance without alteration at the regular meeting at which it is presented and adopt the ordinance within 10 days after it is presented; or (b) Direct the City Clerk to prepare the documents required to submit the ordinance, without alteration, to the voters at the next regular municipal election occurring not less than 88 days after the date of the order; or (c) Order a report pursuant to Section 9212 at the regular meeting at which the ordinance is presented. When the report is presented to the City Council, the Council shall either adopt the ordinance within 10 days or order an election pursuant to subdivision (b). BACKGROUND: A notice of intention to circulate this petition was filed with the City Clerk on February 22, 1999. As required, the documents were transmitted to the City Attorney for preparation of a ballot title and summary, which were provided to the proponent March 8. The notice was 1 9 • • published in the Easy Reader March 11, and the petition was then circulated. Multiple petitions were submitted September 7, the deadline for filing within the 180 -day time limit, and after the required Clerk's review, were forwarded to the office of the Registrar- Recorder/County Clerk for signature verification, which was completed within the time limit of 30 working days. As required, the matter is now being presented to Council. REVIEW OF ALTERNATIVES: Option (a) – Introduce the Ordinance If the City Council selects Option (a)—to introduce the ordinance without alteration at tonight's meeting—there would be no election on the measure. Because State law requires the subsequent adoption of the ordinance to take place within 10 days, it would be necessary to adjourn tonight's meeting to a date no later than Thursday, October 21, 1999, in order to adopt the ordinance within the State -mandated time limit. Option (b) – Direct that the Measure be Placed on the November 2001 Ballot If the City Council selects option (b)—to direct the City Clerk to bring back, at the appropriate time, the required documents to submit the ordinance without alteration to a vote of the people all appropriate resolutions would be prepared for Council adoption in June or July 2001, prior to the County deadline for placing items on that November ballot. Option (c) – Order a Report Pursuant to Election Code Section 9212 If the City Council selects Option (c)—to order a report tonight—action on the petition would be deferred until the report is presented, at a date certain as directed by the Council, which must be within the next 30 days (by Tuesday, November 9). Pursuant to Elections Code Section 9212, before taking action to either introduce the ordinance or schedule an election, the Council may refer the proposed initiative measure to any City agency or agencies for a report on any or all of the following: 1) its fiscal impact; 2) its effect on the internal consistency of the City's general and specific plans including the housing element, the consistency between planning and zoning, the limitations on City actions under Government Code Section 65008 (Discriminations; prohibition), Chapters 4.2 (Housing Development Approvals) commencing with Section 65913, and Chapter 4.3 (Density Bonuses and Other Incentives) commencing with Section 65915 of Division 1 (Planning and Zoning) of Title 7 (Planning and Land Use); and/or 3) any other matters the Council requests to be in the report. This report shall be presented to the Council within the time prescribed by the Council, but not later than 30 days after the Clerk certifies to Council the sufficiency of the petition. 2 In order to meet that 30 -day deadline, unless a special meeting is scheduled, the last regular Council meeting at which any report must be presented would be Tuesday, November 9. Once the report is presented, the Council must then either introduce the ordinance (and adopt it within 10 days) or direct the preparation of documents, at the appropriate time, to submit the proposed ordinance to the voters at the next regular municipal election in November 2001. Elaine Doerfling, City Cler Noted: Attachments: City Clerk's Certificate of Sufficiency of the petition Letter from County giving results of signature verification Proposed ordinance identified as Exhibit "A" 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24. 25 26 27 28 • STATE OF CALIFORNIA COUNTY OF LOS ANGELES CITY OF HERMOSA BEACH CERTIFICATE OF SUFFICIENCY Initiative Petition entitled "AN ORDINANCE ADDING SECTIONS 2.08.040 AND 2.08.050 TO THE HERMOSA BEACH MUNICIPAL CODE," which proposes to establish limits on the number of consecutive terms which may be served by City Council members. I, ELAINE DOERFLING, CITY CLERK OF THE CITY OF HERMOSA BEACH, CALIFORNIA, DO HEREBY CERTIFY THAT SAID PETITION IS SUFFICIENT, FOR THE FOLLOWING REASONS: 1. The number of registered voters at the time the Notice of Intention was published, according to the County Clerk's report to the Secretary of State, was 13,428. 2. The number of signatures needed to qualify this proposed initiative for a regular election was at least 10% of the registered voters, or 1,343. 3. The number of signatures needed to qualify this proposed initiative for a special election was at least 15% of the registered voters, or 2,015. 4. The results of the signature verification by the office of the County of Los Angeles Registrar-Recorder/County Clerk are as follows: Number of signatures filed 1,964 Number of signatures verified 1,964 a. Number of signatures qualified 1,387 b. Number of signatures not qualified 577 c. Percentage qualified (of those filed) 71% THEREFORE, I HAVE HEREUNTO SET THE SEAL OF THE CITY OF HERMOSA BEACH, CALIFORNIA. Elaine Doerfling, C Dated: October 4, 1999 CONNY B. McCORMACK REGISTRAR-RECORDERICOUNTY CLERK COUNTY OF LOS ANGELES REGISTRAR-RECORDER/COUNTY CLERK 12400 IMPERIAL HWY. - P.O. BOX 1024, NORWALK, CALIFORNIA 90651-1024 September 28, 1999 Ms. Elaine Doerfling, City Clerk City of Hermosa Beach 1315 Valley Drive Hermosa Beach, CA 90254-3885 fcE1Th1 SEP 2 9 1999 6-- 47.40 ..„ 0�v�i'i�y Dear Ms. Doerfling: Enclosed are 46 petition sections pertaining to an ordinance which was submitted for signature verification on September 10, 1999. The results of the signature verification are as follows: Number of signatures filed Number of signatures verified Number of signatures found sufficient Number of signatures found not sufficient 577 1,964 1,964 1,387 Not sufficient because duplicate 101 Please call Dorothy Scates, Head of the Data Entry and Signature Verification Section at (562) 462-2376 if you have any questions regarding the signature verification of this petition. Sincerely, CONNY B. McCORMACK Registrar-Recorder/County Clerk E:Coord:L DOERF 92899 . EXHIBIT "A" INITIATIVE MEASURE TO BE SUBMITTED DIRECTLY TO THE VOTERS EXHIBIT "A" AN ORDINANCE OFTHE CITY OF HERMOSA BEACH, CALIFORNIA, ADDING SECTIONS 2.08.040 AND 2.08.050 TO THE CITY OF HERMOSA BEACH MUNICIPAL CODE THE CITY OF HERMOSA BEACH TERM LIMITS ACT The people of the City of Hermosa Beach do ordain as follows: SECTION 1. TITLE. This ordinance shall be known as, and may be cited as, "The City of Hermosa Beach Term Limits Act." SECTION 2. FINDINGS, DETERMINATIONS AND DECLARATIONS. The people of the City of Hermosa Beach hereby find, determine, and declare all of the following: (a) The Founding Fathers established a system of representative government based on free, fair, and competitive elections. The increased concentration of political power in the hands of incumbent representatives has made our electoral system less free, less competitive, and less representative. The ability of City Council members to serve unlimited number of terms contributes heavily to the extremely high number of incumbents who are reelected. These unfair incumbent advantages discourage qualified candidates from seeking public office and create a class of career politicians, instead of the citizen representatives envisioned by the Founding Fathers. These career politicians become representatives of the bureaucracy, rather than of the people whom they are elected to serve. To restore a free and democratic system of fair elections, and to encourage qualified candidates to seek public office, the powers of incumbency must be limited and limitations placed on the number of terms which may be served. (b) Local government should serve the needs and respond to the wishes of all citizens equally, without regard to their wealth; (c) Elected public officials should perform their duties in an impartial manner, free from bias caused by their own financial interests or the financial interests of persons who have supported them; (d) Lobbyists often make their contributions to incumbents who cannot be effectively challenged because of election laws and abusive practices which give the incumbent an unfair advantage; (e) Previous laws regulating political practices have suffered from inadequate enforcement by state and local authorities; (f) Over 3,700,000 California voters passed Proposition 140 term limits and enjoy term limits for President, Governor, State Senate, State Assembly, Mayor of Los Angeles, and numerous city and state officials throughout California; (g) Unlimited terms in the office of City Council of the City of Hermosa Beach significantly reduces the citizens ability to participate in and determine the future of the City. To restore a free and democratic system of fair elections, and to encourage qualified candidates to seek public office, the powers of incumbency must be limited and limitations placed on the number of terms which may be served. (h) It is the will of the people of The City of Hermosa Beach that current and future elected City Council members of the City of Hermosa Beach shall be limited in their terms of office to a maximum of two terms. SECTION 3. PURPOSE AND INTENT. The purpose and intent of this act is to establish a system of representative government based on free, fair, and competitive elections; to create a more representative system of government, and; to encourage qualified candidates to seek public office. The City of Hermosa Beach Municipal Code is subject to the following modifications to read: (Parts A -B) (A) Chapter 2.08 (Elections) by ADDING new Section 2.08.040 as follows: Section 2.08.040 TERM LIMITS. (a) Except as provided in Subsection 2.08.040.b, no person may serve in the office of City Council of The City of Hermosa Beach more than two terms, but upon the passage this measure no person who has held the office or who then holds the office may serve more than one additional term. This Subsection shall apply to any term that a member of the City Council has served or is serving in that office on the date this measure is adopted. A "term" does not include any unexpired term to which a City Council Member is elected if the remainder of the term is less than one-half of the full term. Page 1 of 2 • • (b) Any City Council member who has served the maximum number of terms set in Subsection 2.08.040.a may seek reelection upon the expiration of four consecutive intervening terms. Subsection 2.08.040.a shall apply to any additional terms to which a City Council member is reelected. (c) In no event shall the operation of this measure cause a vacancy in office of a member of The City Council serving an unexpired term on the date this measure is adopted. (B) Chapter 2.08 (Elections) by ADDING new Section 2.08.050 as follows: Section 2.08.050 CITY COUNCIL CANDIDATES; BALLOT ACCESS. (a) Not withstanding any other provision of law, the elections official of The City of Hermosa Beach shall not accept or verify the signatures on any nomination paper for any person, nor shall he or she certify or place on the list of certified candidates, nor print or cause to be printed on any ballot, ballot pamphlet, sample ballot, or ballot label the name of any person, who seeks to become a candidate for the City Council of The City of Hermosa Beach, and who, by the end of the then current term of office will have served or but for resignation would have served, as a member of The City Council of The City of Hermosa Beach for eight or more of the previous fifteen years; (b) "WRITE-IN" CANDIDACIES. Nothing in this measure shall be construed as preventing or prohibiting any qualified voter of the City of Hermosa Beach from casting a ballot for any person by writing the name of that person on the ballot, or from having such a ballot counted or tabulated, nor shall any provision of this section be construed as preventing or prohibiting any person from standing or campaigning for office of City Council of The City of Hermosa Beach by means of a "write-in" campaign. SECTION 4. CONSTRUCTION. Nothing in this measure shall be construed as preventing or prohibiting the name of any person from appearing on the ballot at any election unless that person is specifically prohibited from doing so by the provisions of Section 2.08.040.a and to that end, the provisions of Section 2.08.040.a shall be strictly construed. SECTION 5. INITIATIVE INTEGRITY. (A) This act shall be broadly construed and applied in order to fully promote its underlying purposes, and to be consistent with the United States Constitution and the Constitution of the State of California. If any provision of this initiative conflicts directly or indirectly with any other provisions of law of the City of Hermosa Beach, or if any ordinance which is adopted concurrently with this ordinance which receives less votes and is in direct or indirect conflict with any provisions herein, it is the intent of the voters that those other provisions are repealed to the extent of the inconsistency and such inconsistencies shall be of no force and effect. (B) No provisions of this act or part thereof may be modified, amended, or repealed without a vote of the electorate of The City of Hermosa Beach. (C) If any provision portion, clause or phrase of this act is for any reason held to be invalid or unconstitutional by a court of competent jurisdiction, the remaining portions, clauses, and phrases shall not be affected, but shall remain in full force and effect. The portions of this act shall supersede all inconsistent provisions of city law. (D) It is the will of the People of The City of Hermosa Beach that any legal challenges to the validity of any provision of this act be acted upon by the courts upon an expedited basis. SECTION 6. This initiative measure is to be adopted by the City Council of Hermosa Beach or be submitted to the voters at the next succeeding municipal election or at a special election as provided for by law. SECTION 7. This act shall take effect the day after the election, or in the manner prescribed by law. SECTION 8. The City Clerk shall certify to the adoption of this ordinance and shall cause the same to be published in the manner prescribed by law. Page 2of2 Adelphia Communications Corporation owns and operates one of the nation's largest broadband communication networks capable of offering a wide range of telecommunications services, including cable television, high-speed Internet access and telephony. Through our subsidiary, Hyperion Telecommunications, Inc., Adelphia provides similar telecommunication services to business customers. Adelphia Cable Entertainment is the foundation for our future growth and remains our core business. As our Voice and Data Services continue to expand, we're rapidly becoming the only communications provider a home or business will ever need. Whether it's state -of - the art digital cable, personal paging, high speed Internet access or competitive Long Distance services, Adelphia provides choice to our growing customer base and combines that choice with a renewed commitment to premium customer care. As we approach the new millennium, Adelphia is bringing it together as nev before in our goal to become our customer's 'link for everything.' TABLE OF CONTENTS Financial Highlights page 1 hareholders' Letter page 2 Services page 4 Selected Financial Data page 12 anagement's Discussion and Analysis of Financial Condition and Results of Operations page 15 Independent Auditors' Report page 24 Consolidated Financial Statements page 25 Notes to Consolidated Financial Statements �_. page 29 Stockholder Information page 46 Management Information page 48 Financial Highlights (dollars in thousands) As of and for the year ended March 31, 1996 1997 1998 Millions Adelphia Consolidated Revenues EBITDA (a) Interest Expense - Net Capital Expenditures Total Assets Total Debt Debt Net of Cash 403,597 472,778 528,442 211,124 242,033 265,423 200,068 232,325 247,107 100,089 129,609 183,586 1,367,579 1,643,826 2,304,671 2,175,473 2,544,039 2,909,745 2,164,664 2,482,500 2,632,850 Revenues Hyperion Revenues EBITDA (a) Interest Expense - Net Capital Expenditures 3,322 (2,452) 5,889 6,084 5,088 (5,124) 22,401 36,127 13,510 (8,608) 36,030 68,629 Total Assets Total Debt Debt Net of Cash 35,269 50,855 50,855 634,893 528,776 298,026 Adelphia, Excluding Hyperion Revenues 400,275 EBITDA (a) Interest Expense Net Capital Expenditures Total Assets Total Debt Debt Net of Cash EBITDA Margin (b) 213,576 194,179 94,005 1,332,310 2,124,618 2,113,809 467,690 247,157 209,924 93,482 1,469,225 2,328,364 2,326,639 53.4% 52.80/o Subscriber Data as of March 31, 1998 Adelphia Homes Passed (c) 1,670,068 Basic Subscribers (d) 1,215,040 Premium Subscribers 543,915 Olympus 755,185 501,722 219,597 Managed 347,278 259,409 108,799 514,932 274,031 211,077 114,957 1,669,778 2,380,969 2,334,824 53.2% Total 2,772,531 1,976,171 872,311 (a) EBITDA presented above is defined as operating income plusdepreciation and amortization and rate regulation charge. EBITDA and other similar measurements of cash flow are commonly used in the telecom- munications industry to analyze and compare telecommunications companies on the basis of operatingper- formance, leverage and liquidity. While EBITDA is not alternative to operating income as an indicator of operating performance or an alternative to cash flows from operating activities as a measure of liquidity, all as defined by generally accepted accounting principles, and while EBITDA may not be comparable to other similary titles measures of other companies, Adelphia's management believes EBITDA is a meaningful measure of performance. (b) Percentage representing EBITDA divided by revenues. (c) A home is deemed to be "passed" by cable if it can be connected to the distribution system without any further extension of the cable distribution plant (d) A home with one or more television sets connected to a cable system is counted as one basic subscriber EBITDA Stock Price Adelphia, Your Link For Everything The driving force'behind this new world of telecommunications is choice, the very premise upon which our cable company was started back in 1952 in Coudersport, Pennsylvania. Our Cable Entertainment services have quickly evolved to bring our customers far greater choice in video services, through our commitment to deploying the latest network echnology, through expanded programming options and through the latest technological advancement of Digital Cable. At the same time, we've taken the concept of 'choice' many steps further as a bona fide competitor in many new data and voice service areas: Adelphia Power Link (high-speed Internet access and data transmission), Adelphia PageTime (personal paging service), Adelphia Long Distance (competitive long dis- tance telephone service) and local telephone and other services to the business market through our Hyperion subsidiary. And soon, local telephone rvice to the residential market nder the Adelphia brand name, as we fulfill our commitment to become 'Your Link For Everything.' In 1998, we made significant progress in launching a wide complement of new services hroughout the majority of our systems. Our attention now turns o increasing the availability and penetration of these products hroughout all of Adelphia's arket areas. nks to the successful introduction of our new broadband ;services, record levels To Our Stockholders and Friends: In the same year that the cable television industry celebrated the 50th anniversary of its founding, Adelphia was able to look ahead to a future that holds almost unlimited potential for our company as much more than a cable provider. Industry developments and the financial trends of 1998 confirmed what we have believed all along: that the broadband telecommunications network which has been the focus of so much of our time and energies in recent years is clearly the preferred pipeline into consumers' homes, not only for multichannel video services, but also for data, voice and a variety of other telecommunications services never envisioned just a few short years ago. Meanwhile, Adelphia and its subsidiary, Hyperion Telecommunications, Inc., made significant strides to prepare ourselves for the new competitive landscape that awaits us as we approach the next millennium. of revenue and operating cash flow and renewed investor confidence in the cable industry, we realized tremendous growth in the value of our stock during 1998. Many in the financial community now view cable as the medium of choice in delivering and receiving video, data and voice services because of the dependability of the infrastructure and the experience of the operators. Adelphia's managers and engineers recognized the potential and attractiveness of the hybrid fiber/coaxial cable plant several years ago. We embarked on a vigorous campaign to increase the capacity and reliability of our networks so that we would be prepared to successfully compete for the customers who demand greater choice in their telecommunications services. This plan will result in over 95 percent of Adelphia's systems being served by state-of-the-art two-way hybrid fiber/coaxial capable plant by year 2000. investors are not the only ones responding. Cable subscribers, already impressed with Adelphia's track record as a reliable provider of Cable Entertainment, are also being attracted to Adelphia's expanded product offerings. The impressive early sales figures for Digital Cable, Power Link, PageTime and Long Distance tell us that these new services will become significant sources of revenue, and operating cash flow. We'll also continue to lay the ground- work for entering into the very promising residential telephony market through the combination of our upgraded cable plant, and the expertise we have developed in the business telephony market through our Hyperion subsidiar Also in 1998, we saw advertisers nationally, regionally, and locally committing larger portions of their budgets to cable. This resulted in record levels of revenues and operating cash flows from our Media Partners advertising sales division this year. Adelphia has long recognized that our success depends upon keeping our customers satisfied. To that end, we set rigid Customer Care standards and provide the necessary resources to our employees to ensure that we meet and exceed these standards. We believe providing the best levels of customer service and continuing to offer a range of products and services that offer our customers convenience, simplicity and value, will sustain our growth far into the next century. Growth Strategy Recently significant new investors have entered the Cable Television industry, notably Microsoft, AT&T and Paul Allen, the co-founder of Microsoft. We believe these investors help ratify both the broadband technology and the underlying financial value of cable television system assets. Adelphia improved its strategic position by completing several joint ventures and system acquisitions. The transactions strengthened our regional clusters, allowing for more efficient operations and a greater presence by our company in several key market areas. A joint venture partnership with Tele-Communications, Inc. (TCI) was completed in July. Under this agreement, Adelphia holds a 66.7% (managing) interest in a 475,000 subscriber cluster in the Greater Western New York Region. A second major development in 1998 was the completion of a trade of cable systems in seven states with Time Warner. This advanced Adelphia's efforts to consolidate our customer base to specific geographic regions. Also in July, Adelphia (through the Olympus joint venture part- nership) reaffirmed its position as the dominant cable provider in southern Florida by completing the acquisition of the cable system serving Fort Myers, Florida. This transaction boosts our subscriber count in our Florida region over the 600,000 mark. With the completion of the TCI joint venture, Time Warner swap, Ft. Myers acquisition and other recently announced acquisitions, approximately 90% of our total owned and managed subscribers will be located in our five largest regional clusters, each with a minimum of 240,000 subscribers per cluster. Looking Ahead The critical guide, however, is not growth for its own sake, but a strategic pursuit of opportunities to expand our customer base and revenue streams as we pursue many of the opportunities unfolding in the converging fields of telecommunications. The Telecommunications Act of 1996 leveled the playing field and opened the door to competition. Even prior to this, we had been working hard to fulfill the prophecy and the intentions of that far-reaching law. These can be summarized by one simple word: choice. Competition has made Adelphia a stronger company. As the marketplace has rapidly evolved with the emergence of actual or potential competitors, we have already witnessed how much we can gain by remaining strategically positioned to win the battle for customers of video entertainment and many other products and services. We will continue to complement our technological and operational advances with the strongest possible commitment to the communities which Adelphia serves. We enjoy excellent relations with our franchise authorities, our elected officials and, most important of all, our customers. Fifty years ago, the pioneers of this industry introduced the world to a new concept: 'cable television.' Not long afterwards, the company that would become Adelphia arose in tiny Coudersport, Pa., delivering a handful of customers two snowy channels. What has transpired since that time is nothing short of incredible. I am so deeply appreciative of the time, the talents and the dedication of thousands of people who have made it all possible: our employ- ees, our stockholders and our friends both inside and outside of the telecommunications industry. We are indeed privileged to be operating in this exciting field, in these truly exciting times. The developments of 1998 have shown us that, without a doubt, the foundation we are laying today will allow us to deliver ever increasing convenience, value and simplicity to our customers tomorrow. Sincerely, John Rigas Chairman, President and Chief Executive Officer Cable Entertainment The Foundation for the Future are building our future." Adelphia Cable Entertainment, our core video business, continues to be the most important way we connect with our customers. Adelphia's subscriber penetration in the markets it serves consistently exceeds industry averages. Adelphia remains committed to delivering value to its customers in the form of the highest quality video services at affordable prices. Adelphia believes technological innovation through system upgrades is critical to this commitment. We are an industry leader in the deployment of fiber optic cable with one of the most advanced cable network infrastructures. Recent upgrades have incorporated fiber deployment to reach, on average, 180 homes passed per fiber node. Currently, over 55% of Adelphia's homes passed have cable plant bandwidth capacity of 550 MHZ or 750 MHZ, with over 40% of the plant miles being two-way capable. Adelphia maintains the highest quality Customer Care through the development and implementation of policies and bench- marks that exceed National Cable Television Association and FCC standards. We offer 24 hour, seven day a week customer support, and an On -lime Guarantee for in-home ser- vice that continues to set the standard within the industry. We continue to expand within our eight regional clusters, while further optimizing operating efficiencies and minimizing operating costs. Our 46 years of experience in the cable television business, during which we built our regionally clustered broadband networks, along with our reputation for superior customer service, allow us to expand our business into a broad range of telecommunications products. While Adelphia today means more than cable television, our cable customers, our technology and the operating expertise we have developed as a video provider are the foundations upon which we are building our future as a full service communications company. Digital Cable Bringing You the Future of Cable Today "Adelphia Digital Cable uses the latest digital compression and fiber optic network technology to bring more entertainment and choke into your home." Add • ice in Decembe all of its market areas. Th s digital video service expands customers' programming choices through digital compression technology. This "state-of-the-art" technology offers many new choices to Adelphia digital subscribers including 'multichannel' premium networks, dramatically expanded Pay -Per -View offerings at the touch of a button, up to 40 channels of CD -quality music, and an interactive on-screen program guide which allows customers to easily navigate the new digital choices. Digital Cable customers have more choice and flexibility, which means more control over what they watch and when they watch it. Customers also enjoy the improved picture and sound quality that the latest digital technology delivers. The digital platform will enable us to offer exciting new services such as video on demand, e-mail, and Internet access over the television in the very near future. Voice and Data Services Putting it All Together High Speed Internet Access We Show You the World Power Link, Adelphia's High Speed Internet Access service, has enjoyed high consumer acceptance and strong growth in the previous year. Power Link provides Internet access to residential and business customers at very high speed, much faster than any typical phone modem or ISDN services. Power Link is now available to approximately 1.4 million Adelphia customers in two configurations. The full broadband service features a cable connection for both "directions" of the service and eliminates the need for an additional phone line. The service is always on. Just "click" and you're surfing the net. lit" areas wlr iwb available, Power Link speed service, which combines the very high speeds of broadband on the data stream with a telephone return path. Power Link offers up to four e-mail addresses per account, Web Hosting, a detailed, consumer oriented web page for on line help, instructions and a toll free customer care number for our subscribers. Over 10,000 customers now use Power Link. With the ongoing expansion of our two way cable plant, we anticipate continued growth and high levels of customer satisfaction. Adelphia also offers traditional Internet access utilizing an existing phone modem and telephone lines for both the downstream and return path data transmission. As an Internet Service Provider, we can offer affordable Internet access without the endless busy signals encountered with some ISP's. These customers are also future prospects for Power Link. PageTime Adelphia's Personal Paging Service s and services, an outstanding customer care." PageTime, Adelphia's personal paging service, began offering one way communication services in the fall of 1995 and is closing in on 30,000 customers. The combination of competitive pricing, high quality products, generous coverage areas, multiple distribution points, convenient billing and outstanding customer care differentiates PageTime from the rest of the competition. The emphasis on selling enhanced services such as voice mail, expanded coverage, and pager warranty programs helps drive revenue and is a key element in PageTime's marketing, promotion and business plan. During the past fiscal year, PageTime expanded its product and service offerings in two different ways. In August 1997, PageTime began offering alphanumeric paging service, giving our customers the ability to receive complete text messages. Messages can be relayed through the use of software with a standard telephone modem, can be dispatched through live operator service, or sent via the Internet. In March 1998, PageTime began offering Voice Paging services in selected markets. Adelphia's Pocketalk is now available in our Florida and Philadelphia markets. The consumer is able to listen to the caller's message directly from the paging unit. "Long Distance further positions Adelphia as a full service communications and technology provider: n August of 1997, Adelphia began selitng ng Distance senrice to its subscribers in 'New York State. Since then, Adelphia has expanded its penetration throughout its subscriber base and now offers a variety of services under the Long Distance umbrella, including Travel Card services, 800 service, Pre -Paid Calling Cards and International Calling, all competitively priced. Offering Long Distance rounds out Adelphia's product and service offerings and further positions us as a full service communications and technology provider. The combination of an aggressive pricing strategy, six second billing increments, centralized customer care and the ability to bundle Long Distance with other services, is helping propel the business forward. With 7,000 customers and nearly 10,000 lines in service, Adelphia Long Distance is poised for aggressive growth. As customers recognize the simplicity of our rate structure, our no strings attached approach and the reliability of our service, we're confident that the business will continue to grow and serve as a complement to our other communications offerings. Hyperion The Power Behind Your Communications rtestates: its and main- tains state-of-the-art fiber optic SONET networks and provides business, government and education end-users with customized communication solutions. Hyperion's robust array of services include: Hyperion Local Track Hyperion Local Track provides customers with local dial tone and local data services and allows access to the long distance carrier of their choice, including Hyperion Long Distance. Hyperion's Business Line and Business Trunk products deliver basic local service. Hyperion's ISDN products provide a local service solution to customers with sophisticated communication needs including, videoconferencing, high-speed Internet connections and simultaneous use of phone/fax/data equipment. Hyperion Global Track Hyperion Global Track extends the reach of customers through domestic and international long distance services. Customers use Hyperion Long Distance Service as a reliable and affordable way to complete intrastate, interstate and international calls. Plus, Hyperion Calling Cards give customers the anywhere and of any time. Hyperion Internet Track Hyperion Internet Track provides customers with easy access to a worldwide marketplace through quick and cost-effective dial-up or dedicated Internet access. Plus, Hyperion provides its customers with Internet support services to ensure they receive the most out of their investment. Hyperion Data Track Hyperion plans to launch a suite of data services during the first quarter of 1999. Hyperion will leverage its backbone network and technologies (such as frame relay, ATM and IP) to fulfill the data communication needs of our customers. Hyperion Direct Track Hyperion Direct Track provides customers with a dedicated communications link between company locations or between company locations and an interex- change carrier. These non -switched communications channels are offered in a range of transmission capacities and accommodate the dedicated communication needs of businesses and institututions. Hyperion Advanced Track Hyperion Advanced Track provides customers with integrated call services and an individualized dialing plan. Customers can receive advanced calling services at multiple locations with- out the need for duplicate systems. Plus, they are easily upgradeable to ensure that our customers' phone systems are never outdated. Hyperion Mail Track Hyperion Mail Track provides customers with an electronic voice messaging system and gives them a convenient and dependable way to communicate with others. This enhanced service also allows customers to integrate their voice and e-mail systems. cion ret onsions n July 1 , Hyperion Communications took a big step toward ensuring its future by laying the foundation to become a super -regional CLEC throughout the eastern and southeastern United States. Over the next year and a half, Hyperion will develop a fully redundant, self -healing fiber optic network through the regional interconnection of its existing 20 markets with more than 50 new markets. This coverage is expected to increase the company's addressable market to more than 20 million business access lines equaling $40 billion in annual revenue. Through agreements with Qwest Communications, Williams Communications and several other fiber optic network providers, Hyperion has ownership or an indefeasi- ble right of use of fiber representing over 8,100 new route miles. Along with extensive coverage, the super -regional network provides the enabling architecture for Hyperion to extend its line of Ings, high-tech to applica such as IP, ATM and Frame flay. `these new services wi complement Hyperion's currer `product lines and further position Hyperion as a facilities -based one -stop -shop for business communications. Additionally, the network architecture implemented by Hyperion will allow the company to serve several markets from one central office switching location. This will result in higher capital utilization of traditional circuit switched technology, and provides Hyperion with the flexibility to exploit emerging packet switched IP technologies and services. Hyperion is committed to being a major influence in the communications industry. The infrastructure is in place for us to make a significant contribution to the explosive growth in the telecommunica- tions market in the eastern United States. Hyperion's goal is quite simple: To offer the most comprehensive suite of communications services to businesses over advanced state- of-the-art fiber optic networks, ensuring a level of service, quality and customer care unsurpassed in the communications industry. Adelphia Communications Corporation SELECTED FINANCIAL DATA (Dollars in thousands except per share amounts) The selected consolidated financial data as of and for each of the five years in the period ended March 31, 1998 have been derived from the audited consolidated financial statements of Adelphia. These data should be read in conjunction with the consolidated financial statements and related notes thereto as of March 31, 1997 and 1998 and for each of the three years in the period ended March 31, 1998 and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included elsewhere in this Annual Report. The statement of operations data with respect to fiscal years ended March 31, 1994 and 1995, and the balance sheet data at March 31, 1994, 1995 and 1996, have been derived from audited consolidated financial statements of Adelphia not included herein. • Statement of Operations Data Revenues Direct operating and programming expense Selling, general and administrative expense Depreciation and amortization expenses Rate regulation charge Operating income Other (expense) income Priority investment income from Olympus Cash interest expense -net Noncash interest expense Equity in loss of joint ventures Hyperion preferred stock dividends Gain on sale of investments Loss before income taxes, extraordinary loss and cumulative effect of change in accounting principle (a) Income tax (expense) benefit Loss before extraordinary loss and cumulative effect of change in accounting principle (a) Extraordinary loss on early retirement of debt Cumulative effect of change in accounting for income taxes (a) Net loss Dividend requirements applicable to preferred stock Net loss applicable to common stockholders Year Ended March 31, 1994 1995 1996 1997 1998 $ 319,045 $ 361,505 $ 403,597 $ 472,778 $ 528,442 90,547 106,993 124,116 148,982 167,288 52,801 89,402 63,487 97,602 68,357 111,031 5,300 81,763 124,066 95,731 145,041 86,295 93,423 94,793 117,967 120,382 i (299) 22,300 (171,268) (1,680) (30,054) 1,453 22,300 (169,830) (14,756) (44,349) 28,852 (183,780) (16,288) (46,257) 42,086 (190,965) (41,360) (59,169) 12,151 47,765 (209,677) (37,430) (79,056) (12,682) 2,538 (94,706) (111,759) (122,680) (119,290) (168,160) (2,742) 5,475 2,786 358 5,606 (97,448) (106,284) (119,894) (118,932) (162,554) (752) (89,660) (11,710) (11,325) (187,860) (106,284) (119,894) (130,642) (173,879) (18,850) $ (187,860) $ (106,284) $ (119,894) $ (130,642) $ (192,729) Basic and diluted loss per weighted average share of common stock before extraordinary loss and cumulative effect of change in accounting principle (a) $ (5.66) $ (4.32) $ (4.56) $ (4.50) $ (6.07) Basic and diluted net loss per weighted average share of common stock (10.91) (4.32) (4.56) (4.94) (6.45) Cash dividends declared per common share 12 Selected Financial Data Business Segment Information (Dollars in thousands) Adelphia operates primarily in two lines of business within the telecommunications industry: cable television and related investments ("Adelphia, excluding Hyperion") and competitive local exchange carrier telephony (Hyperion). The balance sheet data and other data as of and for each of the five years ended March 31, 1998 of Hyperion have been derived from audited consolidated financial statements of Hyperion not included herein. The data for the three months ended March 31, 1997 and 1998 is unaudited; however, in the opinion of management, such data reflect all adjustments (consisting only of normal and recurring adjustments) necessary to fairly present the data for such interim periods. Balance Sheet Data March 31, 1994 1995 1996 1997 1998 ADELPHIA CONSOLIDATED Total assets $1,073,846 $1,267,291 .$1,367,579 $1,643,826 $ 2,304,671 Total debt 1,793,711 2,021,610 2,175,473 2,544,039 2,909,745 Investments (b) 24,416 50,426 74,961 130,005 150,787 Redeemable preferred stock — — — — 355,266 Convertible preferred stock (liquidation preference) 100,000 HYPERION Total assets $ 14,765 $ 23,212 $ 35,269 $ 174,601 $ 634,893 Total debt 19,968 35,541 50,855 215,675 528,776 Investments (b) 9,068 15,085 27,900 56,695 66,648 Redeemable preferred stock — — — — 207,204 ADELPHIA, EXCLUDING HYPERION Total assets $ 1,059,081 $1,244,079 $1,332,310 $1,469,225 $1,669,778 Total debt 1,773,743 1,986,069 2,124,618 2,328,364 2,380,969 Investments (b) 15,348 35,341 47,061 73,310 84,139 Redeemable preferred stock — — — — 148,062 Convertible preferred stock (liquidation preference) 100,000 See "Other Data" on next page. O❑ Lr) O ❑ 8UOMM8U1,S 13 Adelphia Communications Corporation Other Data For the Year Ended March 31, 1994 1995 1996 1997 1998 For the Three Months Ended March 31, 1997 1998 ADELPHIA CONSOLIDATED Revenues $ 319,045 $ 361,505 $ 403,597 $ 472,778 $528,442 Priority income 22,300 22,300 28,852 42,086 47,765 Operating expenses (c) 143,348 170,480 192,473 230,745 263,019 Depreciation and amortization expense Operating income Interest expense -net Preferred stock dividends Capital expenditures Cash paid for acquisitions Cash used for investments HYPERION Revenues Operating expenses (c) Depreciation and amortization expense Operating loss Interest expense -net Preferred stock dividends Capital expenditures Cash paid for acquisitions Cash used for investments 89,402 97,602 111,031 124,066 145,041 86,295 93,423 94,793 117,967 120,382 (172,948) (184,586) (200,068) (232,325) (247,107) - (31,532) 75,894 92,082 100,089 129,609 183,586 21,681 70,256 60,804 143,412 146,546 8,890 38,891 24,333 51,415 86,851 $122,203 $138,537 11,454 12,000 61,147 71,010 34,514 26,542 (57,871) 43,194 7,042 14,665 40,471 27,056 (59,766) (13,546) 66,026 58,329 24,661 $ 417 $ 1,729 $ 3,322 $ 5,088 $ 13,510 $ 1,477 $ 4,820 2,375 3,906 5,774 10,212 22,118 3,137 7,756 189 463 1,184 3,945 11,477 (2,147) (2,640) (3,636) (9,069) (20,085) (2,147) (3,282) (5,889) (22,401) (36,030) - - - - (12,682) 3,097 2,850 6,084 36,127 68,629 - - - 5,040 65,968 5,510 7,526 12,815 34,769 64,260 ADELPHIA, EXCLUDING HYPERION Revenues $ 318,628 Priority income 22,300 Operating expenses (c) 140,973 Depreciation and amortization expense Operating income Interest expense -net Preferred stock dividends Capital expenditures Cash paid for acquisitions Cash used for investments $ 359,776 $ 400,275 $ 467,690 $514,932 22,300 28,852 42,086 47,765 166,574 186,699 220,533 240,901 89,213 97,139 109,847 120,121 133,564 88,442 96,063 98,429 127,036 140,467 (170,801) (181,304) (194,179) (209,924) (211,077) - (18,850) 72,797 89,232 94,005 93,482 114,957 21,681 70,256 60,804 138,372 80,578 3,380 31,365 11,518 16,646 22,591 1,362 4,450 (3,022) (7,386) (5,961) (8,047) (6,694) 21,177 33,795 58,329 11,371 18,141 $120,726 $133,717 11,454 12,000 58,010 63,254 33,152 29,564 (51,910) 22,017 7,042 3,294 36,021 34,442 (51,719) (6,852) 32,231 6,520 (a) "Cumulative Effect of Change in Accounting Principle" refers to a change in accounting principle for Adelphia. Effec- tive April 1, 1993, Adelphia adopted the provisions of Statement of Financial Accounting Standards ("SFAS") No. 109, "Accounting for Income Taxes," which requires an asset and liability approach for financial accounting and reporting for income taxes. The adoption of SFAS No. 109 resulted in the cumulative recognition of an additional liability by Adelphia of $89,660. (b) Represents total investments before cumulative equity in net losses. (c) Amount excludes depreciation and amortization. 14 Management's Discussion and Analysis of Financial Condition and Results of Operations MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Dollars in thousands) RESULTS OF OPERATIONS General Adelphia earned substantially all of its revenues in each of the last three fiscal years from monthly subscriber fees for basic, cable value, premium and ancillary services (such as installations and equip- ment rentals), local and national advertising sales, pay-per-view programming, home shopping networks and competitive local exchange carrier ("CLEC") services. The changes in Adelphia's results of operations for the years ended March 31, 1997 and 1998, compared to the respective prior year, were primarily the result of acquisitions, expanding existing cable television operations and the impact of increased advertising sales and other service offerings as well as an increase in cable rates, effective October 1, 1996 and August 1, 1997. The high level of depreciation and amortization associated with the significant number of acquisi- tions in recent years, the recent upgrading and expansion of systems, interest costs associated with financing activities and Hyperion's continued investment in the CLEC business will continue to have a negative impact on the reported results of operations. Also, significant charges for depreciation, amortiza- tion and interest are expected to be incurred in the future by the Olympus joint venture, which will also adversely impact Adelphia's future results of operations. Adelphia expects to report net losses for the next several years. Hyperion, together with its subsidiaries, owns certain investments in CLEC joint ventures and manages those ventures. Hyperion is an unre- stricted subsidiary for purposes of Adelphia's indentures. The table at right is derived from Adelphia's consolidated financial statements that are included in this Annual Report and sets forth the historical Percentage of Revenues Year Ended March 31, 1996 1997 1998 Revenues 100.0% 100.0% 100.0% Operating Expenses: Direct operating and programming 30.8 31.5 31.7 Selling, general and administrative 16.9 17.3 18.1 Depreciation and amortization 27.5 26.2 27.4 Rate regulation 1.3 — — Operating Income 23.5% 25.0% 22.8% percentage relationship to revenues of the components of operating income contained in such financial statements for the periods indicated. Comparison of the Years Ended March 31, 1996, 1997 and 1998 Revenues The primary revenue sources reflected as a percentage of total revenues were as follows: Year Ended March 31, 1996 1997 1998 Regulated service and equipment fees 73% 74% 75% Premium programming fees 12% 12% 10% Advertising sales and other services 15% 14% 15% Revenues increased approximately 17.1% for the year ended March 31, 1997 and 11.8% for the year ended March 31, 1998 compared with the respective prior fiscal year. The increases were attributable to the following: Year Ended March 31, 1997 1998 Acquisitions 42% 37% Basic subscriber growth 12% Rate increases 38% Premium programming fees (5%) Advertising sales and other services 13% 13% 9% 48% (7%) 15 Adelphia Communications Corporation Effective October 1, 1996 and August 1, 1997, certain rate increases related to regulated cable services were implemented in substantially all of Adelphia's Systems. Advertising revenues and revenues derived from other strategic service offerings such as paging, high speed data services, long distance and CLEC services also had a positive impact on revenues for the year ended March 31, 1998. Direct Operating and Programming Expenses Direct operating and programming expenses, which are mainly basic and premium programming costs and technical expenses, increased 20.0% and 12.3% for the years ended March 31, 1997 and 1998, respectively, compared with the respective prior year. Such increases were primarily due to increased operating expenses from acquired systems, increased programming costs and incremental costs associ- ated with increased subscribers. Because of regulatory limitations on the timing and extent to which cost increases may be passed on to customers, direct operating and programming expenses have increased at a greater rate than corresponding revenue increases. As a result of recent FCC regulatory rulemaking decisions, Adelphia intends to continue its systematic program of rate increases to reverse this trend. Additionally, Hyperion expenses increased due to expansion of operations at its network control center, as well as an increase in the number and size of its networks, which resulted in increased employee related costs and equipment maintenance costs. Selling, General and Administrative Expenses These expenses, which are mainly comprised of costs related to system offices, customer service repre- sentatives, and sales and administrative employees, increased 19.6% and 17.1% for the years ended March 31, 1997 and 1998, respectively, compared with the respective prior year. The increases were primarily due to incremental costs associated with acquisitions, subscriber growth and Hyperion overhead and network oper- ating and control center cost increases to accommodate the growth in the number of operating companies managed and monitored. Depreciation and Amortization Depreciation and amortization was higher for the years ended March 31, 1997 and 1998, compared with the respective prior year, primarily due to increased depreciation and amortization related to acquisitions consummated during the years ended March 31, 1996, 1997 and 1998, as well as increased capital expendi- tures made during the past several years. Rate Regulation Expenses The fiscal year ended March 31, 1996 includes a $5,300 charge representing management's estimate of the total costs associated with the resolution of subscriber rate disputes. Such costs include (i) an estimate of credits to be extended to customers in future periods of up to $2,700, (ii) legal and other costs incurred during the two fiscal years ended March 31, 1998, and (iii) an estimate of legal and other costs to be incurred associated with the ultimate resolution of this matter. On May 1, 1997, Adelphia reached a settlement with the FCC regarding such rate disputes. The amount recorded in the year ended March 31, 1996 was adequate to cover the settlement. Priority Investment Income from Olympus Priority investment income is comprised of payments received from Olympus of accrued priority return on Adelphia's investment in PLP Interests in Olympus. Priority investment income increased during the years ended March 31, 1997 and 1998 as compared with the respective prior year due to increased payments by Olympus. Interest Expense—net Interest expense—net increased approximately 16.1% and 6.4% for the years ended March 31, 1997 and 1998, respectively. For the year ended March 31, 1997 interest expense increased primarily due to incremental debt related to acquisitions and the issuance of the Hyperion 13% Senior Discount Notes. These increases were partially offset by a decrease in the average interest rate on outstanding debt. For the year ended March 31, 1998, interest expense—net increased primarily due to incremental debt related to acquisitions and the issuance of the Hyperion 12.25% Senior Secured Notes. These increases were partially offset by (i) the utiliza- tion of the proceeds from the convertible preferred stock and the redeemable preferred stock offerings to repay outstanding debt; (ii) the refinancing of outstanding borrowings and (iii) interest income on cash balances. Interest expense includes non-cash accretion of original issue discount and non-cash interest expense totaling $16,288, $41,360 and $37,430 for the years ended March 31, 1996, 1997 and 1998, respectively. The decrease in non-cash interest for the year ended March 31, 1998 as compared to the prior year was 16 Management's Discussion and Analysis of Financial Condition and Results of Operations primarily due to Adelphia's cash payment of interest on its 9.5% Senior Pay -In -Kind notes for the six month period ended February 15, 1998. This decrease was partially offset by the accretion of original issue discount related to the Hyperion 13% Senior Discount Notes. Equity in Loss of Joint Ventures The equity in loss of joint ventures represents primarily (i) Adelphia's pro rata share of Olympus' losses and the accretion requirements of Olympus' preferred limited partner interests, and (ii) Hyperion's pro rata share of its less than majority owned partnerships' operating losses. The increase in the loss during the year ended March 31, 1997, compared with the prior year, is due to an increase in the losses of certain investments in the CLEC business in which Hyperion is a less than majority partner and increased losses of Olympus. The increase in the loss during the year ended March 31, 1998, compared with the prior year, is primarily due to losses of Olympus and an increase in the losses of certain Hyperion CLEC joint ventures. Hyperion Preferred Stock Dividends During the year ended March 31, 1998, Hyperion incurred $12,682 of expense relating to its 12.875% Senior Exchangeable Redeemable Preferred Stock issued in October 1997. Gain on Sale of Investments On May 16, 1996, Hyperion completed the sale of its 15.7% partnership interest in TCG South Florida to Teleport Communications Group Inc. for an aggregate sales price of $11,618 resulting in a gain of $8,405. On January 23, 1997, Adelphia received 284,425 shares of Republic Industries, Inc. Common Stock ("Republic stock") in exchange for its interest in Commonwealth Security, Inc. ("Commonwealth") for an aggregate sales price of $9,315 resulting in a gain of $3,746. During the year ended March 31, 1998, Adelphia sold its Republic stock, its investment in the Golf Channel and certain other assets, resulting in a gain of $2,538. Extraordinary Loss on Early Retirement of Debt During the year ended March 31, 1997, certain bank indebtedness was repaid and a portion of the 12.5% Senior Notes due 2002 was reacquired resulting in an extraordinary loss on retirement of debt. The amount pertaining to the repayment of bank debt was $2,079, which primarily represents the write-off of the remaining deferred debt financing costs associated with the debt retired. The amount pertaining to the 12.5% Senior Notes was $9,631, which represents the excess of reacquisition cost over the net carrying value of the related debt. During the year ended March 31, 1998, Adelphia reacquired through open market purchases $20,000 of 9.5% Senior Pay -in -Kind Notes due 2004 and redeemed $202,000 of 12.5% Senior Notes due 2002 at 106% of principal. As a result of these two transactions, Adelphia recognized an extraordinary loss of $11,325 for the year ended March 31, 1998. Liquidity and Capital Resources The cable television and other telecommunications businesses are capital intensive and typically require continual financing for the construction, modernization, maintenance, expansion and acquisition of cable and other telecommunications systems. During the three fiscal years in the period ended March 31, 1998, Adelphia committed substantial capital resources for these purposes and for investments in Olympus, and other affiliates and entities. These expenditures were funded through long-term borrowings and internally generated funds. For the fiscal years ended March 31, 1996, 1997 and 1998, cash provided by operating activi- ties totaled $64,287, $43,001 and $66,270, respectively; cash used for investing activities totaled $189,462, $322,047 and $563,520, respectively and cash provided by financing activities totaled $130,939, $329,776 and $712,606, respectively. Adelphia's aggregate outstanding borrowings as of March 31, 1998 were $2,909,745. Adelphia also had total redeemable preferred stock of $355,266 outstanding as of March 31, 1998. Adelphia's ability to generate cash to meet its future needs will depend generally on its results of operations and the continued availability of external financing. Capital Expenditures Capital expenditures for Adelphia, excluding Hyperion for the years ended March 31, 1996, 1997 and 1998 were $94,005, $93,482 and $114,957, respectively. Capital expenditures including Hyperion for the years ended March 31, 1996, 1997 and 1998 were $100,089, $129,609 and $183,586, respectively. The increase in capital expenditures for fiscal 1996, 1997 and 1998, compared to each respective prior year, was primarily due to the acceleration of the rebuilding of plant using fiber -to -feeder technology and Hyperion's introduction of switching services. Adelphia expects that capital expenditures for fiscal 1999 will be in a range of approxi- mately $150,000 to $170,000 for Adelphia, excluding Hyperion. Adelphia expects Hyperion to continue to have significant capital expenditure and investment requirements. 17 O ❑ WOWEI3E4S Adelphia Communications Corporation Financing Activities Adelphia's financing strategy has been to maintain its public long-term debt at the parent holding company level while Adelphia's consolidated subsidiaries have their own senior and subordinated credit arrangements with banks and insurance companies, or for Hyperion, its own public debt and equity. Adelphia's ability to generate cash adequate to meet its future needs will depend generally on its results of operations and the continued availability of external financing. During the three-year period ended March 31, 1998, Adelphia generally funded its working capital requirements, capital expenditures, and investments in Olympus, CLEC joint ventures and other affiliates and entities through long-term borrowings primarily from banks, short-term borrowings, internally generated funds and the issuance of public debt or equity. Adelphia generally has funded the principal and interest obligations on its long-term borrowings from banks and insurance companies by refinancing the principal with new loans or through the issuance of parent and subsidiary company debt securities, and by paying the interest out of internally generated funds. Adelphia has funded the interest obligations on its public borrowings from internally generated funds. Most of Adelphia's directly -owned subsidiaries have their own senior credit agreements with banks and/or insurance companies. Typically, borrowings under these agreements are collateralized by the stock and, in some cases, by the assets of the borrowing subsidiary and its subsidiaries and, in some cases, are guaranteed by such subsidiary's subsidiaries. At March 31, 1998, an aggregate of $775,725 in borrowings was outstanding under these agreements. These agreements contain certain provisions which, among other things, provide for limitations on borrowings of and investments by the borrowing subsidiaries, transactions between the borrowing subsidiaries and Adelphia and its other subsidiaries and affiliates, and the payment of dividends and fees by the borrowing subsidiaries. Several of these agreements also contain certain cross - default provisions relating to Adelphia or other subsidiaries. These agreements also require the maintenance of certain financial ratios by the borrowing subsidiaries. In addition, at March 31, 1998, an aggregate of $52,000 subordinated and unsecured borrowings by Adelphia's subsidiaries was outstanding under credit agreements containing limitations and restrictions similar to those mentioned above. See Note 3 to the Adelphia Communications Corporation consolidated financial statements. Management believes Adelphia is in compliance with the financial covenants and related financial ratio requirements contained in its various credit agreements, based on operating results for the three months ended March 31, 1998. In addition, as of March 31, 1998, Hyperion had outstanding $329,000 aggregate principal amount at maturity of 13% Senior Discount Notes due 2003, with a carrying amount of $215,213, which were issued under an indenture dated April 15, 1996 and $250,000 of 12.25% Senior Secured Notes due 2004, which were issued under an indenture dated August 27, 1997. Also, on October 9, 1997, Hyperion issued $200,000 aggregate liquidation preference of 12.875% Senior Exchangeable Redeemable Preferred Stock due 2007. At March 31, 1998, Adelphia's subsidiaries had an aggregate of $235,620 in unused credit lines with banks, part of which is subject to achieving certain levels of operating performance. In addition, Adelphia had an aggregate $276,895 in cash and cash equivalents at March 31, 1998 which combined with Adelphia's unused credit lines with banks aggregated to $512,515. Adelphia has the ability to pay interest on its 9.5% Senior Pay -In -Kind Notes by issuing additional notes totaling approximately $18,123 in lieu of cash interest payments from April 1, 1998 through February 15, 1999. Based upon the results of opera- tions of subsidiaries for the quarter ended March 31, 1998, approximately $442,000 of available assets could have been transferred to Adelphia at March 31, 1998, under the most restrictive covenants of the subsidiaries' credit agreements. The subsidiaries also have the ability to sell, dividend or distribute certain assets to other subsidiaries or Adelphia, which would have the net effect of increasing availability. At March 31, 1998, Adelphia's unused credit lines were provided by reducing revolving credit facilities whose revolver periods expire through September 30, 2004. Adelphia's scheduled maturities of debt are currently $128,213 for fiscal 1999. At March 31, 1998, Adelphia's total outstanding debt aggregated $2,909,745, which included $1,580,274 of parent company debt and $1,329,471 of subsidiary debt. Bank debt interest rates are based upon one or more of the following rates at the option of Adelphia: prime rate plus 0% to 1.75%; certificate of deposit rate plus 1.125% to 2.125%; or LIBOR plus .625% to 2.75%. Adelphia's weighted average interest rate on notes payable to banks and institutions was approximately 8.11% at March 31, 1998, compared to 8.83% at March 31, 1997. At March 31, 1998, approximately 28.77% of subsidiary debt was subject to fixed interest rates for at least one year under the terms of such debt or applicable interest rate swap agreements. Approximately 76.61% of Adelphia's total indebtedness was at fixed interest rates as of March 31, 1998. Adelphia has entered into interest rate swap agreements and interest rate cap agreements with banks and affiliates to reduce the impact of changes in interest rates on its debt. Adelphia enters into pay -fixed agreements to effectively convert a portion of its variable-rate debt to fixed-rate debt. Adelphia enters into receive -fixed agreements to effectively convert a portion of its fixed-rate debt to variable-rate debt 18 Management's Discussion and Analysis of Financial Condition and Results of Operations which is indexed to LIBOR. Interest rate cap agreements are used to reduce the impact of increases in interest rates on variable rate debt. Adelphia is exposed to credit loss in the event of nonperformance by the banks and the affiliates. Adelphia does not expect any such nonperformance. At March 31, 1998, Adelphia would have had to pay approximately $5,822 to settle its interest rate swap and cap agree- ments, representing the excess of carrying cost over fair market value of these agreements. Financing Transactions Adelphia, Excluding Hyperion During fiscal 1997, Adelphia issued $350,000 of publicly held senior debt ("Senior Notes") and certain subsidiaries of Adelphia entered into a $690,000 financing arrangement consisting of a $540,000 revolving credit facility maturing December 31, 2003 and a $150,000 term loan facility maturing December 31, 2004. During fiscal 1998, Adelphia issued $625,000 of Senior Notes and $150,000 aggregate liquidation preference, 13% Cumulative Exchangeable Preferred Stock (the "Exchangeable Preferred Stock"), which is mandatorily redeemable in 2009. On July 2, 1998, Adelphia issued $150,000 of 8.125% Senior Notes due 2003. On August 18, 1998, Adelphia completed a public offering of 4,100,000 shares of Class A Common Stock at a public offering price of $32.00 per share. In addition to the 4,100,000 shares sold by Adelphia to the public, $125,000 or 4,090,315 shares were sold directly to members of the family of John J. Rigas, Chairman of Adelphia, at the public offering price less the underwriters discount. During fiscal 1998, Adelphia also issued 100,000 shares of perpetual Series C Convertible Preferred Stock (the "Convertible Preferred Stock") with a par value of $.01 per share and an aggregate liquidation preference of $100,000 in a private placement of which $80,000 was sold to a Rigas family affiliate and the remainder was sold to Telesat Cablevision, Inc., a wholly owned subsidiary of FPL Group, Inc., a New York Stock Exchange company and a 50% partner in Olympus. The Convertible Preferred Stock accrues dividends at the rate of 8.125% of the liquidation preference per annum, and is convertible at $8.48 per share into an aggregate of 11,792,450 shares of Class A Common Stock of Adelphia. The Convertible Preferred Stock is redeemable at the option of Adelphia after three years from the date of issuance at a premium declining to the liquidation preference in 2002. Proceeds from the sale of the Exchangeable Preferred Stock, the Senior Notes and the Convertible Preferred Stock were used to repay subsidiaries' senior notes and revolving credit facility borrowings. On October 31, 1997, Adelphia redeemed $202,000 aggregate principal amount of 12.5% Senior Notes due 2002 at 106% of principal. On May 15, 1998, Adelphia redeemed the remaining $69,838 of the 12.5% Senior Notes due 2002 at 103% of principal. Hyperion During Fiscal 1998, Hyperion issued $250,000 aggregate principal amount of 12.25% Senior Secured Notes due 2004 and $200,000 aggregate liquidation preference 12.875% Senior Exchangeable Redeemable Preferred Stock due 2007. In addition, during May 1998, Hyperion successfully completed an initial public offering ("IPO") of its Class A Common Stock. Net proceeds from these three transactions will primarily be used to fund capital expenditures, working capital, potential increases in ownership inter- ests in existing networks and for general corporate purposes. For additional information regarding Adelphia's and Hyperion's financing transactions, see Notes 3, 4, 6 and 13 to Adelphia's Consolidated Financial Statements. Acquisitions Adelphia, Excluding Hyperion For the year ended March 31, 1998, Adelphia acquired (i) cable systems serving approximately 25,800 subscribers in the Virginia cities of Blacksburg and Salem for an aggregate price of $54,500, (ii) 61% of the partnership interests of cable systems serving approximately 20,300 subscribers in the Western New York area for an aggregate price of $20,737, (iii) cable systems serving approximately 3,400 subscribers in Vermont for an aggregate price of $8,096, and (iv) 82% of the partnership interests of cable systems serving approximately 16,000 subscribers in Pennsylvania, Maryland and West Virginia for an aggregate price of $23,615. These acquisitions further contributed to Adelphia's existing clusters. See Note 1 to Adelphia's Consolidated Financial Statements for a further discussion of acquisitions. On March 2, 1998, Adelphia entered into a definitive agreement to acquire cable television systems serving approximately 62,000 subscribers in Connecticut and Virginia from Marcus Cable, Inc. for approximately $150,000 in cash. Adelphia expects this acquisition to close during fiscal year 1999. 00 e =0 ,[1]edEel,E,S 19 Adelphia Communications Corporation On April 1, 1998, Adelphia and its affiliates and Time Warner Entertainment and an affiliate ("Time Warner") traded certain cable systems. Adelphia exchanged its systems serving 64,400 subscribers primarily in the Mansfield, Ohio area for systems owned by Time Warner cable companies serving 70,200 subscribers adjacent to systems owned or managed by Adelphia in Virginia, New England and New York. On July 31, 1998, Adelphia established a joint venture partnership with TCI into which TCI contributed its cable systems in Buffalo, New York; Erie, Pennsylvania; and Ashtabula and Lake County, Ohio, totaling approximately 171,000 subscribers, and Adelphia contributed its Western New York and Lorain, Ohio systems, totaling approximately 298,000 subscribers. TCI holds a minority interest in the partnership. Adelphia also has signed an agreement to acquire cable systems serving approximately 10,000 subscribers in Vermont for a purchase price of $18.0 million. Hyperion On September 12, 1997 and February 12, 1998, Hyperion acquired the partnership interests of various of its Local Partners, thereby increasing its ownership interest in seven of its networks to 100% for an aggregate cash purchase price of approximately $52,000 and certain other consideration. As a result of these transac- tions, Hyperion's weighted average ownership in its networks, based upon gross property plant and equip- ment, increased to 77% as of March 31, 1998. These transactions are consistent with Hyperion's goal to own at least a 50% interest in each of its networks and to dispose of its interests in those in which acquiring a controlling interest is not economically attractive. Hyperion may consider similar transactions from time to time in its other markets. On March 25, 1998, the FCC completed the auction of licenses for Local Multipoint Distribution Service ("LMDS"). Hyperion, through a limited partnership in which it is a 49.9% limited partner, was the successful bidder at a net cost of $25,600 for 232 31-Ghz licenses, which cover approximately 38% of the nation's popu- lation—in excess of 90 million people in the eastern half of the United States. Hyperion funded $10,000 of such purchase in January 1998, and is committed to provide further funding to consummate such purchase upon the granting of such licenses by the FCC, expected during fiscal 1999. LMDS is a fixed broadband point -to -multipoint service which the FCC anticipates will be used for the deployment of wireless local loop, high-speed data transfer and video broadcasting services. Hyperion plans to use such spectrum for "last - mile" connectivity in certain of its markets, and believes the spectrum to be highly complementary to its fiber -based systems. There can be no assurances that LMDS spectrum will provide a cost-effective means to connect to end user locations. Resources Adelphia plans to continue to explore and consider new commitments, arrangements or transactions to refinance existing debt, increase Adelphia's liquidity or decrease Adelphia's leverage. These could include, among other things, the future issuance by Adelphia, or its subsidiaries, of public or private equity or debt and the negotiation of new or amended credit facilities. These could also include entering into acquisitions, joint ventures or other investment or financing activities, although no assurance can be given that any such transactions will be consummated. Adelphia's ability to borrow under current credit facilities and to enter into refinancings and new financings is limited by covenants contained in Adelphia's indentures and its subsidiaries' credit agreements, including covenants under which the ability to incur indebtedness is in part a function of applicable ratios of total debt to cash flow. Adelphia believes that cash and cash equivalents, internally generated funds, borrowings under existing credit facilities, and future financing sources will be sufficient to meet its short-term and long-term liquidity and capital requirements. Although in the past Adelphia has been able to refinance its indebtedness or obtain new financing, there can be no assurance that Adelphia will be able to do so in the future or that the terms of such financings would be favorable. Management believes that the telecommunications industry, including the cable television and tele- phone industries, continues to be in a period of consolidation characterized by mergers, joint ventures, acquisitions, sales of all or part of cable companies or their assets, and other partnering and investment transactions of various structures and sizes involving cable or other telecommunications companies. Adelphia continues to evaluate new opportunities that allow for the expansion of its business through the acquisition of additional cable television systems in geographic proximity to its existing regional markets or in locations that can serve as a basis for new market areas. The Company, like other telecommunications companies, has participated from time to time and is participating in preliminary discussions with third parties regarding a variety of potential transactions, and Adelphia has considered and expects to continue to consider and explore potential transactions of various types with other cable and telecommunications companies. However, no assurances can be given as to whether any such transaction may be consummated or, if so, when. 20 Management's Discussion and Analysis of Financial Condition and Results of Operations Affiliates Olympus Adelphia serves as the managing general partner of Olympus and, as of March 31, 1998, held $5 of voting general partnership interests representing, in the aggregate, 50% of the voting interests of Olympus. Adelphia also held, as of March 31, 1998, approximately $325,911 aggregate principal amount of nonvoting PLP interests in Olympus, which entitle Adelphia to a 16.5% per annum priority return. The remaining equity in Olympus consists of voting and nonvoting partnership interests held by FPL Group. During the years ended March 31, 1996 and 1997, Adelphia received net distributions and advances from Olympus totaling $45,499 and $9,012, respectively. During the year ended March 31, 1998, Adelphia made net investments in and advances to Olympus totaling $11,466. During the years ended March 31, 1996, 1997 and 1998, Adelphia received priority investment income from Olympus of $28,852, $42,086 and $47,765, respectively. The Olympus limited partnership agreement requires approval by the holders of 85% of the voting interests for, among other things, significant acquisitions and dispositions of assets, and the issuance of certain partnership interests, and also requires approval by the holders of 75% of the voting interests for, among other things, material amendments to the Olympus partnership agreement, certain financings and refinancings, certain issuances of PLP interests, certain transactions with related parties and the adoption of annual budgets. During the years ended March 31, 1996, 1997 and 1998, Olympus acquired several cable and security systems, adding approximately 151,000 subscribers for approximately $295,800. Olympus also completed two financing arrangements totaling $675,000 during the years ended March 31, 1996, 1997 and 1998. For additional information regarding Olympus acquisitions and financings, see Note 1 to Olympus' Consolidated Financial Statements. On July 15, 1998, Olympus purchased cable televison systems from Jones Intercable, Inc. for $110,000 cash which serve approximately 46,000 subscribers in and around the city of Ft. Myers, Florida. Olympus also entered into a definitive agreeement expected to close during calendar year 1998 for the purchase of cable systems serving approximately 20,000 subscribers in the Lake Okeechobee area of southeast Florida for $33,400. These acquisitions will be accounted for under the purchase method of accounting. The Selected Financial Data and Management's Discussion and Analysis of Financial Condition and Results of Operations for Olympus for each of the three years in the period ended December 31, 1997 appear on pages 22 through 31 of the Annual Report on Form 10-K of Olympus Communications, L.P. and Olympus Capital for the year ended December 31, 1997. The financial information for Olympus as of March 31, 1998 and for the three months ended March 31, 1997 and 1998 appears on pages 3 through 5 of the Olympus and Olympus Capital Corporation Form 10-Q for the quarterly period ended March 31, 1998. Managed Partnerships On September 29, 1993, the Board of Directors of Adelphia authorized Adelphia to make loans in the future to the Managed Partnerships up to an amount of $50,000. During the years ended March 31, 1996 and 1998, Adelphia made advances in the net amount of $14,859 and $21,458, respectively, to these and other related parties, primarily for capital expenditures and working capital purposes. During the year ended March 31, 1997, the Managed Partnerships and other related parties repaid advances in the net amount of $34,250. Recent Accounting Pronouncements Statement of Financial Accounting Standards ("SFAS") No. 130, 'Reporting Comprehensive Income," and SFAS No. 131 "Disclosures about Segments of an Enterprise and Related Information," have been issued and are effective for fiscal years beginning after December 15, 1997. SFAS No. 130 defines comprehensive income and outlines certain reporting and disclosure requirements related to comprehensive income. SFAS No. 131 requires certain disclosures about business segments of an enterprise, if applicable. The adoption of SFAS No. 130 and SFAS No. 131 is not expected to have a significant impact on Adelphia's financial state- ments or disclosures. SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities," has been issued and is effective for fiscal quarters beginning after June 15, 1999. SFAS No. 133 establishes accounting and reporting standards for derivative instruments and for hedging activities. It requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value. Statement of Position ("SOP") 98-5, "Reporting on the Costs of Start -Up Activities," has been issued and is effective for fiscal years beginning after December 15, 1998. SOP 98-5 provides guidance on the financial reporting of start-up costs and organization costs. It requires such costs to be expensed as incurred. Management of Adelphia has not evaluated the impact of SFAS 133 or SOP 98-5. ,(tEleEflel3g1,S 21 Adelphia Communications Corporation Inflation In the three fiscal years in the period ended March 31, 1998, inflation did not have a significant effect on Adelphia. Periods of high inflation could have an adverse effect to the extent that increased borrowing costs for floating-rate debt may not be offset by increases in subscriber rates. At March 31, 1998, after giving effect to interest rate hedging agreements, approximately $589,575 of Adelphia's total debt was subject to floating interest rates. Regulatory and Competitive Matters The cable television operations of Adelphia may be adversely affected by changes and developments in governmental regulation, competitive forces and technology. The cable television industry and Adelphia are subject to extensive regulation at the federal, state and local levels. The 1992 Cable Act significantly expanded the scope of regulation of certain subscriber rates and a number of other matters in the cable industry, such as mandatory carriage of local broadcast stations and retransmission consent, and increased the administrative costs of complying with such regulations. The FCC has adopted rate regulations that establish, on a system -by -system basis, maximum allowable rates for (i) basic and cable programming services (other than programming offered on a per -channel or per -program basis), based upon a benchmark methodology, and (ii) associated equipment and installation services based upon cost plus a reasonable profit. Under the FCC rules, franchising authorities are authorized to regulate rates for basic services and associated equipment and installation services, and the FCC will regulate rates for regulated cable programming services in response to complaints filed with the agency. The 1996 Act ends FCC regulation of cable programming service tier rates on March 31, 1999. Rates for basic and cable programming services are set pursuant to a benchmark formula. Alternatively, a cable operator may elect to use a cost -of -service methodology to show that rates for basic and cable programming services are reasonable. Refunds with interest will be required to be paid by cable opera- tors who are required to reduce regulated rates. The FCC has reserved the right to reduce or increase the benchmarks it has established. The rate regulations also limit increases in regulated rates to an inflation indexed amount plus increases in certain costs such as taxes, franchise fees, costs associated with specific franchise requirements and increased programming costs. Cost -based adjustments to these capped rates can also be made in the event a cable operator adds or deletes channels or completes a significant system rebuild or upgrade. Because of the limitation on rate increases for regulated services, future revenue growth from cable services will rely to a much greater extent than has been true in the past on increased revenues from unregulated services and new subscribers than from increases in previously unregulated rates. The FCC has adopted regulations implementing all of the requirements of the 1992 Cable Act. The FCC is also likely to continue to modify, clarify or refine the rate regulations. Adelphia cannot predict the effect of the 1996 Act or future rulemaking proceedings or changes to the rate regulations. In fiscal 1996, Adelphia recorded a $5,300 charge representing management's estimate of the total costs to be incurred to resolve all of Adelphia's rate complaints with the FCC. On May 1, 1997, Adelphia reached a settlement of all rate complaints before the FCC on terms and conditions consistent with certain other cable television companies that utilized a la carte packages that have reached settlement/ resolution with the FCC on this issue. Under the terms of the agreement, Adelphia made refunds of approx- imately $2,400 (including interest through December 31, 1996), plus interest from January 1, 1997 through the date of payment. Adelphia also reduced its rates in certain communities. At March 31, 1998, $832 of the $5,300 charge remained in accrued interest and other liabilities, which management believes is adequate to cover the settlement. No assurance can be given as to what other future actions Congress, the FCC or other regulatory authorities may take or the effects thereof on Adelphia. Adelphia is currently unable to predict the effect that the amended regulations, future FCC treatment of a la carte packages or other future FCC rulemaking proceedings will have on their business and results of operations in future periods. Cable television companies operate under franchises granted by local authorities which are subject to renewal and renegotiation from time to time. Because such franchises are generally non-exclusive, there is a potential for competition with the systems from other operators of cable television systems, including public systems operated by municipal franchising authorities themselves, and from other distribution systems capable of delivering television programming to homes. The 1992 Cable Act and the 1996 Act contain provisions which encourage competition from such other sources. Adelphia cannot predict the extent to which competition will materialize from other cable television operators, local telephone companies, other distribution systems for delivering television programming to the home, or other potential competitors, or, if such competition materializes, the extent of its effect on Adelphia. 22 Management's Discussion and Analysis of Financial Condition and Results of Operations The 1996 Act repealed the prohibition on CLECs from providing video programming directly to customers within their local exchange areas other than in rural areas or by specific waiver of FCC rules. The 1996 Act also authorized CLECs to operate "open video systems" ("OVS") without obtaining a local cable franchise, although CLECs operating such a system can be required to make payments to local governmental bodies in lieu of cable franchise fees. Where demand exceeds capacity, up to two-thirds of the channels on an OVS must be available to programmers unaffiliated with the CLEC. The statute states that the OVS scheme supplants the FCC's 'video dialtone" rules. The FCC has promulgated rules to implement the OVS concept, and New Jersey Bell Telephone Company has been granted permission to convert its video dialtone authorization in Dover Township, New Jersey to an OVS authorization. Adelphia believes that the provision of video programming by telephone companies in competition with Adelphia's existing operations could have an adverse effect on Adelphia's financial condition and results of operations. At this time, the impact of any such effect is not known or estimable. Adelphia also competes with DBS service providers. DBS has been available to consumers since 1994. A single DBS satellite can provide more than 100 channels of programming. DBS service can be received virtually anywhere in the United States through the installation of a small outdoor antenna. DBS service is being heavily marketed on a nationwide basis by several service providers. At this time, any impact of DBS competition on Adelphia's future results is not known or estimable. Year 2000 Issues The Year 2000 Issue is the result of computer programs being written using two digits rather than four to define the applicable year. Any of Adelphia's computer programs that have time -sensitive soft- ware may recognize a date using "00" as the year 1900 rather than the year 2000. This could result in a system failure or miscalculations causing disruptions of operations, including, among other things, a temporary inability to process transactions, send invoices, or engage in similar normal business activities. Adelphia has recently completed the planning stage of a project that addresses the Year 2000 data processing issues relating to modifications of its mainframe computer applications. Internal and external resources are being used to make the required modifications and perform the necessary tests, all of which is expected to be completed by June 1999. The financial impact of these modifications is not expected to be significant to Adelphia's financial statements. In addition, Adelphia has begun communicating with others with whom it does significant business to determine their Year 2000 compliance readiness and the extent to which Adelphia is vulnerable to any third party Year 2000 issues. However, there can be no guarantee that the systems of other companies on which Adelphia's systems rely will be timely converted, or that a failure to convert by another company, or a conversion that is incompatible with Adelphia's systems, would not have a material adverse effect on Adelphia. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK Not applicable. FINANCIAL STATEMENTS The consolidated financial statements of Adelphia and related notes thereto and independent auditors' report follow. The consolidated financial statements of Olympus and related notes thereto and independent auditors' report dated March 6, 1998 appear on pages 33 through 50 of the Annual Report on Form 10-K of Olympus Communications, L.P. and Olympus Capital Corporation for the year ended December 31, 1997. 00 00 VLII0M11,SES 23 Adelphia Communications Corporation INDEPENDENT AUDITORS' REPORT Adelphia Communications Corporation: We have audited the accompanying consolidated balance sheets of Adelphia Communications Corporation and subsidiaries as of March 31, 1997 and 1998, and the related consolidated statements of operations, of convertible preferred stock, common stock and other stockholders' equity (deficiency), and of cash flows for each of the three years in the period ended March 31, 1998. These financial statements are the responsi- bility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assur- ance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Adelphia Communications Corporation and subsidiaries at March 31, 1997 and 1998, and the results of their operations and their cash flows for each of the three years in the period ended March 31, 1998 in conformity with generally accepted accounting principles. /121.4.0k&-, PI -74r". --$4.c.44(4, L LP Pittsburgh, Pennsylvania June 10, 1998 24 Consolidated Financial Statements Adelphia Communications Corporation and Subsidiaries Consolidated Balance Sheets (Dollars in thousands, except per share amounts) March 31, 1997 1998 ASSETS Property, plant and equipment -net $ 659,575 $ 918,637 Intangible assets -net 650,533 695,104 Cash and cash equivalents 61,539 276,895 U.S. government securities -pledged - 70,535 Investments 117,996 127,827 Preferred equity investment in Managed Partnership 18,338 18,338 Subscriber receivables -net 24,692 30,551 Prepaid expenses and other assets -net 80,355 114,526 Related party receivables -net 30,798 52,258 Total $ 1,643,826 $ 2,304,671 LIABILITIES, PREFERRED STOCK, COMMON STOCK AND OTHER STOCKHOLDERS' EQUITY (DEFICIENCY) Subsidiary debt $ 1,369,367 $ 1,329,471 Parent debt 1,174,672 1,580,274 Accounts payable 56,961 65,019 Subscriber advance payments and deposits 16,004 17,129 Accrued interest and other liabilities 127,938 125,824 Deferred income taxes 110,097 116,351 Total liabilities 2,855,039 3,234,068 Cumulative equity in loss in excess of investment in and amounts due from Olympus 42,668 31,202 Hyperion redeemable exchangeable preferred stock 207,204 Redeemable exchangeable preferred stock 148,062 Commitments and contingencies (Note 5) Convertible preferred stock, common stock and other stockholders' equity (deficiency): 8.125% Series C convertible preferred stock ($100,000 liquidation preference) 1 Class A common stock, $.01 par value, 200,000,000 shares authorized, 16,130,880 and 20,043,528 shares outstanding, respectively 161 200 Class B common stock, $.01 par value, 25,000,000 shares authorized, 10,944,476 shares outstanding 109 109 Additional paid -in capital 219,408 331,263 Accumulated deficit (1,473,559) (1,647,438) Convertible preferred stock, common stock and other stockholders' equity (deficiency) (1,253,881) (1,315,865) Total $ 1,643,826 $ 2,304,671 See notes to consolidated financial statements. V,110(M4128S 25 Adelphia Communications Corporation 26 Adelphia Communications Corporation and Subsidiaries Consolidated Statements of Operations (Dollars in thousands, except per share amounts) Year Ended March 31, 1996 1997 1998 Revenues $ 403,597 $ 472,778 $ 528,442 Operating expenses: Direct operating and programming 124,116 148,982 167,288 Selling, general and administrative 68,357 81,763 95,731 Depreciation and amortization 111,031 124,066 145,041 Rate regulation 5,300 — — Total 308,804 354,811 408,060 Operating income 94,793 117,967 120,382 Other income (expense): Priority investment income from Olympus 28,852 42,086 47,765 Interest expense—net (see Note 1) (200,068) (232,325) (247,107) Equity in loss of Olympus and other joint ventures (41,965) (51,946) (66,089) Equity in loss of Hyperion joint ventures (4,292) (7,223) (12,967) Hyperion preferred stock dividends — (12,682) Gain on sale of investments 12,151 2,538 Total (217,473) (237,257) (288,542) Loss before income taxes and extraordinary loss (122,680) (119,290) (168,160) Income tax benefit 2,786 358 5,606 Loss before extraordinary loss (119,894) (118,932) (162,554) Extraordinary loss on early retirement of debt (11,710) (11,325) Net loss (119,894) (130,642) (173,879) Dividend requirements applicable to preferred stock (18,850) Net loss applicable to common stockholders $ (119,894) $ (130,642) $ (192,729) Basic and diluted loss per weighted average share of common stock before extraordinary loss $ (4.56) $ (4.50) $ (6.07) Basic and diluted extraordinary loss per weighted average share on early retirement of debt (0.44) (0.38) Basic and diluted net loss per weighted average share of common stock $ (4.56) $ (4.94) $ (6.45) Weighted average shares of common stock outstanding (in thousands) 26,305 26,411 29,875 See notes to consolidated financial statements. Consolidated Financial Statements Adelphia Communications Corporation and Subsidiaries Consolidated Statements of Convertible Preferred Stock, Common Stock and Other Stockholders' Equity (Deficiency) (Dollars in thousands) Series C Convertible Class A Class B Additional Preferred Common Common Paid -In Accumulated Stock Stock Stock Capital Deficit Total Balance, March 31, 1995 $ $149 $109 $211,190 $(1,223,023) $(1,011,575) Issuance of Class A common stock on April 3, 1995 5 4,995 5,000 Excess of purchase price of acquired assets over predecessor owners' book value (1,770) (1,770) Net loss (119,894) (119,894) Balance, March 31, 1996 154 109 214,415 (1,342,917) (1,128,239) Issuance of Class A common stock on February 10, 1997 7 4,993 5,000 Net loss (130,642) (130,642) Balance, March 31, 1997 161 109 219,408 (1,473,559) (1,253,881) Issuance of Class A common stock on June 20, 1997 36 24,964 25,000 Issuance of Class A common stock on March 6, 1998 3 8,828 8,831 Issuance of Series C convertible preferred stock on July 7, 1997 1 96,999 97,000 Dividend requirements applicable to exchangeable preferred stock (14,246) (14,246) Dividend requirements applicable to convertible preferred stock (4,604) (4,604) Other (86) (86) Net loss (173,879) (173,879) Balance, March 31, 1998 $ 1 $200 $109 $331,263 $(1,647,438) $(1,315,865) See notes to consolidated financial statements. 00 00 Z,MOIJEJ0803S 27 Adelphia Communications Corporation Adelphia Communications Corporation and Subsidiaries Consolidated Statements of Cash Flows (Dollars in thousands) Year Ended March 31, 1996 1997 1998 Cash flows from operating activities: Net loss $ (119,894) $ (130,642) $ (173,879) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation 70,890 78,328 93,688 Amortization 40,141 45,738 51,353 Noncash interest expense 16,288 41,360 37,430 Noncash dividends on Hyperion preferred stock - - 12,682 Equity in loss of Olympus and other joint ventures 41,965 51,946 66,089 Equity in loss of Hyperion nonconsolidated joint ventures 4,292 7,223 12,967 Rate regulation 2,700 - Gain on sale of investments - (12,151) (2,538) Extraordinary loss on early retirement of debt 11,710 11,325 Decrease in deferred taxes, net of effects of acquisitions(3,930) (500) (6,305) Changes in operating assets and liabilities, net of effects of acquisitions: Subscriber receivables (3,370) (813) (4,351) Prepaid expenses and other assets (14,465) (27,858) (23,437) Accounts payable 23,796 (9,784) 4,282 Subscriber advance payments and deposits (1,788) 1,298 658 Accrued interest and other liabilities 7,662 (12,854) (13,694) Net cash provided by operating activities 64,287 43,001 66,270 Cash flows used for investing activities: Acquisitions (60,804) (143,412) (146,546) Expenditures for property, plant and equipment (100,089) (129,609) (183,586) Investments in Hyperion joint ventures (12,815) (34,769) (64,260) Investments in other joint ventures (11,518) (16,646) (22,591) Investment in U.S. government securities -pledged (83,400) Sale of U.S. government securities -pledged 15,653 Amounts invested in and advanced to Olympus and related parties (4,236) (9,229) (91,468) Proceeds from sale of investments - 11,618 12,678 Net cash used for investing activities (189,462) (322,047) (563,520) Cash flows from financing activities: Proceeds from debt 273,508 1,280,649 1,298,137 Repayments of debt (138,694) (933,517) (977,591) Costs associated with debt financings (3,875) (20,236) (20,498) Premium paid on early retirement of debt (8,207) (12,153) Proceeds from Hyperion's issuance of warrants 11,087 - Issuance of redeemable exchangeable preferred stock - 147,976 Issuance of convertible preferred stock 97,000 Issuance of Hyperion redeemable exchangeable preferred stock 194,522 Preferred stock dividends paid (14,787) Net cash provided by financing activities 130,939 329,776 712,606 Increase in cash and cash equivalents 5,764 50,730 215,356 Cash and cash equivalents, beginning of year 5,045 10,809 61,539 Cash and cash equivalents, end of year $ 10,809 $ 61,539 $ 276,895 Supplemental disclosure of cash flow activity - Cash payments for interest $ 198,369 $ 203,939 $ 220,888 See notes to consolidated financial statements. 28 Notes to Consolidated Financial Statements Adelphia Communications Corporation and Subsidiaries Notes to Consolidated Financial Statements (Dollars in thousands, except per share amounts) 1. THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: The Company and Basis for Consolidation Adelphia Communications Corporation and subsidiaries ("Adelphia") owns, operates and manages cable television systems and other related telecommunications businesses. Adelphia's opera- tions consist primarily of selling video programming which is distributed to subscribers for a monthly fee through a network of fiber optic and coaxial cables. These services are offered in the respective franchise areas under the name Adelphia. Hyperion Telecommunications, Inc. ("Hyperion") is a consolidated subsidiary of Adelphia which owns, operates and manages entities which provide competitive local exchange carrier ("CLEC") telecommunications services. The consolidated financial statements include the accounts of Adelphia and its more than 50% owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. During the years ended March 31, 1996, 1997 and 1998, Adelphia consummated several acquisitions, each of which was accounted for using the purchase method. Accordingly, the financial results of each acquisition have been included in the consolidated results of Adelphia effective with the date acquired. On April 12, 1995, Adelphia acquired cable systems from Clear Channels Cable TV. These systems served approximately 10,700 subscribers at the acquisition date, located in Kittanning, New Bethlehem and Freeport, Pennsylvania and were purchased for an aggregate price of $17,456. On January 9, 1996, Adelphia acquired cable systems from Eastern Telecom Corporation and Robinson Cable TV, Inc. These systems served approximately 24,000 subscribers at the acquisition date located in Western Pennsylvania and were purchased for an aggregate price of $43,000. On April 1, 1996, Adelphia acquired cable systems from Cable TV Fund 11-B, Ltd. These systems served approximately 39,700 subscribers at the acquisition date located in the New York counties of Erie and Niagara and were purchased for an aggregate price of $84,267. On July 12, 1996, Adelphia acquired cable systems from First Carolina Cable TV, L.P. These systems served approximately 32,500 subscribers at the acquisition date, primarily located in Vermont and were purchased for an aggregate price of $48,500. On February 10, 1997, Adelphia acquired the cable systems from Small Cities Cable Television, L.P. and Small Cities Cable Television, Inc. (collectively, "Small Cities"). These systems served approxi- mately 6,000 subscribers at the acquisition date, primarily located in Vermont and were purchased for an aggregate price of $12,000 in cash and Adelphia Class A Common Stock. On June 20, 1997, Adelphia acquired cable systems from Booth Communications Company ("Booth"). These systems served approximately 25,800 subscribers at the acquisition date in the Virginia cities of Blacksburg and Salem and were purchased for an aggregate price of $54,500 in cash and Adelphia Class A Common Stock. On September 12, 1997, Hyperion consummated an agreement with Time Warner Entertainment- Advance/Newhouse ("TWEAN") to exchange interests in four New York CLEC networks. As a result of the transaction, Hyperion paid TWEAN $7,638 and increased its ownership in the networks serving Buffalo and Syracuse, New York to 60% and 100%, respectively, and eliminated its interest in the Albany and Binghamton networks, which became wholly owned by TWEAN. On November 7, 1997, Adelphia acquired approximately 61% of the partnership interests in two cable systems from U.S. Cable Corporation. These systems served approximately 20,300 subscribers at the acquisition date in the western New York area and were purchased for an aggregate price of $20,737. On November 22, 1997, Adelphia acquired a cable system from Memphrecom, Inc. This system served approximately 3,400 subscribers at the acquisition date, in Vermont and was purchased for an aggregate price of $8,096. On December 3, 1997, the Company exchanged its interest in Oxford, North Carolina, a system which served approximately 4,400 subscribers, for TWEAN's interest in its DuBois, Pennsylvania system, which served approximately 3,800 subscribers. 29 Adelphia Communications Corporation On December 31, 1997, Adelphia acquired 82% of the partnership interests in Tele -Media Company of Tri States, L.P. The systems acquired in this transaction served approximately 16,000 subscribers at the acquisition date in Pennsylvania, Maryland and West Virginia and were purchased for an aggregate price of $23,615. On February 12, 1998, Hyperion issued a warrant for 731,624 shares of Hyperion Class A Common Stock to its 50% partner in Hyperion of Harrisburg in exchange for such partnership interest. On February 12, 1998, Hyperion acquired the remaining partnership interests in its Buffalo, NY, Louisville, KY and Lexington, KY networks for approximately $18,300. On February 12, 1998, Hyperion acquired the remaining partnership interests in its Morristown and New Brunswick, NJ networks for approximately $26,328. On March 6, 1998, Adelphia exercised its option to purchase the remaining 15% of its Northeast Cable, Inc. system. The Company issued 341,220 shares of Class A Common Stock to the sellers in connection with this purchase. Investment in Olympus Joint Venture Partnership The investment in the Olympus joint venture partnership comprises both limited and general partner interests. The general partner interest represents a 50% voting interest in Olympus and is being accounted for using the equity method. Under this method, Adelphia's investment, initially recorded at the historical cost of contributed property, is adjusted for subsequent capital contributions and its share of the losses of the partnership as well as its share of the accretion requirements of the partnership's interests. The limited partner interest represents a preferred interest ("PLP interests") entitled to a 16.5% annual return. The PLP interests are nonvoting, are senior to claims of certain other partner interests, and provide for an annual priority return of 16.5%. Olympus is not required to pay the entire 16.5% return currently and priority return on PLP interests is recognized as income by Adelphia when received. Correspondingly, equity in net loss of Olympus excludes accumulated unpaid priority return (see Note 2). Subscriber Revenues Subscriber revenues are recorded in the month the service is provided. Property, Plant and Equipment Property, plant and equipment, at cost, are comprised of the following: Operating plant and equipment Real estate and improvements Support equipment Construction in progress Accumulated depreciation March 31, 1997 1998 $ 969,900 68,091 28,808 134,403 $ 1,290,915 78,435 26,961 171,853 1,201,202 (541,627) 1,568,164 (649,527) $ 659,575 $ 918,637 Depreciation is computed on the straight-line method using estimated useful lives of 5 to 12 years for operating plant and equipment and 3 to 20 years for support equipment and real estate. Additions to property, plant and equipment are recorded at cost which includes amounts for material, applicable labor and overhead, and interest. Capitalized interest amounted to $1,766, $1,727 and $5,985 for the years ended March 31, 1996, 1997 and 1998, respectively. 30 Notes to Consolidated Financial Statements Intangible Assets Intangible assets, at cost, net of accumulated amortization, are comprised of the following: March 31, 1997 1998 Purchased franchises $ 486,887 $ 526,333 Goodwill 71,263 89,029 Non -compete agreements 12,937 8,705 Purchased subscribers lists 79,446 71,037 $ 650,533 $ 695,104 A portion of the aggregate purchase price of systems acquired has been allocated to purchased franchises, purchased subscriber lists, goodwill and non -compete agreements. Purchased franchises and goodwill are amortized on the straight-line method over 40 years. Purchased subscriber lists are amortized on the straight-line method over periods which range from 5 to 10 years. Non -compete agreements are amortized on the straight-line method over their contractual lives which range from 4 to 12 years. Accumulated amortization of intangible assets amounted to $170,801 and $211,967 at March 31, 1997 and 1998, respectively. Cash and Cash Equivalents Adelphia considers all highly liquid investments with original maturities of three months or less to be cash equivalents. Interest income on liquid investments was $1,859, $5,789 and $13,383 for the years ended March 31, 1996, 1997, and 1998, respectively. Book overdrafts of $25,700 and $20,528 existed at March 31, 1997 and 1998, respectively. These book overdrafts were reclassified as accrued interest and other liabilities and accounts payable. U.S. Government Securities -Pledged U.S. Government Securities—Pledged consist of highly liquid investments which will be used to pay the first six semi-annual interest payments of the Hyperion 12.25% Senior Secured Notes. Such investments are classified as held -to -maturity and the carrying value approximates market value. Investments The equity method of accounting is generally used to account for investments in affiliates which are greater than 20% but not more than 50% owned. Under this method, Adelphia's initial investment is recorded at cost and subsequently adjusted for the amount of its equity in the net income or losses of its affiliates. Dividends or other distributions are recorded as a reduction of Adelphia's investment. Investments in affiliates accounted for using the equity method generally reflect Adelphia's equity in their underlying assets. Investments in entities in which Adelphia's ownership is less than 20% and investments greater than 20% in which Adelphia does not influence the operating or financial decisions of the entity are generally accounted for using the cost method. Under the cost method, Adelphia's initial investment is recorded at cost and subsequently adjusted for the excess, if any, of dividends or other distributions received over its share of cumulative earnings. Dividends received in excess of earnings subsequent to the date the investment was made are recorded as reductions of the cost of the investment. 31 Adelphia Communications Corporation The balance of Adelphia's nonconsolidated investments is as follows: March 31, 1997 1998 Investments accounted for using the equity method: Gross investment: Hyperion investments in joint ventures $ 57,497 $ 66,647 Paging 14,990 15,539 Mobile communications 2,470 15,387 Other 1,751 4,706 Total 76,708 102,279 Investments accounted for using the cost method: Niagara Frontier Hockey, L.P. 35,270 40,497 SuperCable ALK International 3,172 3,190 Programming ventures 2,945 1,427 Mobile communications 1,832 2,582 Other 763 812 Total 43,982 48,508 Available for sale investments recorded at fair market value: Republic Industries, Inc. 9,315 Total investments before cumulative equity in net losses 130,005 150,787 Cumulative equity in net losses (12,009) (22,960) Total investments $ 117,996 $ 127,827 On May 16, 1996, Hyperion sold its interest in one of its joint ventures for $11,618, resulting in a gain of $8,405. On January 23, 1997, Adelphia received 284,425 shares of Republic Industries, Inc. Common Stock ("Republic Stock") in exchange for its interest in Commonwealth Security, Inc., result- ing in a gain of $3,746. On October 7, 1997, the Company sold its Republic Stock, on which a gain of $408 was recognized. On March 16, 1998, the Company sold its investment in the Golf Channel, resulting in a gain of $1,520. Certain members of the Rigas Family have entered into an agreement to acquire all the voting interests of Niagara Frontier Hockey, L.P. ("NFHLP"). In connection with the agreement, Adelphia agreed to purchase additional NFHLP capital funding notes of approximately $11,000. Closing is subject to National Hockey League and bank approvals. Subscriber Receivables An allowance for doubtful accounts of $1,345 and $1,166 has been deducted from subscriber receivables at March 31, 1997 and 1998, respectively. Amortization of Other Assets and Debt Discounts Deferred debt financing costs, included in prepaid expenses and other assets, and debt discounts, a reduction of the carrying amount of the debt, are amortized over the term of the related debt. The unamortized amounts of deferred debt financing costs included in prepaid expenses and other assets were $35,786 and $47,653 at March 31, 1997 and 1998, respectively. Franchise Expense The typical term of Adelphia's franchise agreements upon renewal is 10 years. Franchise fees range from 3% to 5% of subscriber revenues and are expensed currently. Net Loss Per Weighted Average Share of Common Stock Basic net loss per weighted average share of common stock is computed based on the weighted average number of common shares outstanding after giving effect to dividend requirements on the Company's preferred stock. Diluted net loss per common share is equal to basic net loss per common 32 Notes to Consolidated Financial Statements share because the Company's convertible preferred stock had an antidilutive effect for the periods presented; however, the convertible preferred stock could have a dilutive effect on earnings per share in future periods. Asset Impairments Adelphia periodically reviews the carrying value of its long-lived assets for impairment whenever M events or changes in circumstances indicate that the carrying value of assets may not be recoverable. © Measurement of any impairment would include a comparison of estimated future operating cash flows anticipated to be generated during the remaining life of the assets with their net carrying value. 0 An impairment loss would be recognized as the amount by which the carrying value of the assets exceeds their fair value. Noncash Financing and Investing Activities There were no material capital leases entered into during the year ended March 31, 1996. Capital leases entered into during the years ended March 31, 1997 and 1998 totaled $1,624 and $2,842, respec- tively, for Adelphia, excluding Hyperion. Hyperion entered into capital leases totaling $1,683 and $24,489, respectively, during the years ended March 31, 1997 and 1998. Reference is made to Notes 1 and 6 for descriptions of additional noncash financing and investing activities. Interest Expense -Net Interest expense—net includes interest income of $10,623, $8,367 and $23,949 for the years ended March 31, 1996, 1997 and 1998, respectively. Interest income includes interest income from affiliates on long-term loans and for reimbursement of interest expense on revolving credit agreements, related to short term borrowings by such affiliates (see Note 11). Interest Rate Swaps Net settlement amounts under interest rate swap agreements are recorded as adjustments to interest expense during the period incurred. Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Recent Accounting Pronouncements Statement of Financial Accounting Standards ("SFAS") No. 130, "Reporting Comprehensive Income," and SFAS No. 131, "Disclosures about Segments of an Enterprise and Related Information," have been issued and are effective for fiscal years beginning after December 15, 1997. SFAS No. 130 defines comprehensive income and outlines certain reporting and disclosure requirements related to comprehensive income. SFAS No. 131 requires certain disclosures about business segments of an enter- prise, if applicable. The adoption of SFAS No. 130 and SFAS No. 131 is not expected to have a significant effect on the Company's financial statements or disclosures. SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities," has been issued and is effective for fiscal quarters beginning after June 15, 1999. SFAS No. 133 establishes accounting and reporting standards for derivative instruments and for hedging activities. It requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value. Statement of Position ("SOP") 98-5, "Reporting on the Costs of Start -Up Activities," has been issued and is effective for fiscal years beginning after December 15, 1998. SOP 98-5 provides guidance on the financial reporting of start-up costs and organization costs. It requires such costs to be expensed as incurred. Management of the Company has not evaluated the impact of SFAS 133 or SOP 98-5. Reclassifications Certain 1996 and 1997 amounts have been reclassified to conform with the 1998 presentation. 33 Adelphia Communications Corporation 2. RELATED PARTY INVESTMENTS AND RECEIVABLES: Related party receivables -net represent advances to managed partnerships (see Note 11), John J. Rigas and certain members of his immediate family, including entities they own or control (collectively, the "Rigas family"). No related party advances are collateralized. Cumulative equity in loss in excess of investment in and amounts due from Olympus is comprised of the following: 34 March 31, 1997 1998 Cumulative equity in loss over investment in Olympus $ (95,771) $ (94,833) Amounts due from Olympus 53,103 63,631 $ (42,668) $ (31,202) On March 28, 1996, ACP, Telesat, Olympus, Adelphia and certain shareholders of Adelphia entered into an agreement which amended certain aspects of the Olympus Partnership Agreement. The amendment provides for the repayment of certain amounts owed to Telesat totaling $20,000, the release of certain obliga- tions of Telesat to Olympus and the reduction of Telesat's PLP and accrued priority return balances by $20,000. The amendment further provides for a $40,000 distribution to Adelphia as a reduction of its PLP interests and accrued priority return. These repayments and distributions were made on March 29, 1996 and were funded through internally generated funds and advances from an affiliate. At March 31, 1996, 1997 and 1998 Adelphia owned $722,860, $271,546, and $325,911 in Olympus PLP Interests, respectively. The major components of the financial position of Olympus as of December 31, 1996 and 1997 and March 31, 1997 and 1998 and the results of operations for the years ended December 31, 1996 and 1997 and the three months ended March 31, 1997 and 1998 were as follows: Balance Sheet Data: Property, plant and equipment -net Total assets Subsidiary debt Parent debt Total liabilities Limited partners' interests General partners' equity (deficiency) Statement of Operations Data: Revenues Operating income Net loss Net loss of general and limited partners after priority return December 31, March 31, 1996 1997 1997 1998 $ 225,775 640,221 309,000 200,000 724,420 407,669 (491,868) $ 265,783 728,952 427,000 200,000 841,169 488,378 (600,615) $ 159,870 $ 176,363 33,013 34,392 (10,950) (19,802) (76,594) (95,695) (unaudited) $ 229,140 627,392 294,000 200,000 715,309 427,325 (515,242) $ 41,411 7,735 (5,318) (23,324) $ 273,162 732,336 470,000 200,000 849,582 508,873 (626,119) $ 50,918 9,642 (4,663) (25,455) On October 6, 1993, Adelphia purchased the preferred Class B Limited Partnership Interest in Syracuse Hilton Head Holdings, L.P. ("SHHH"), a managed partnership, for a price of $18,338 from Robin Media Group. SHHH is a joint venture of the Rigas Family and Tele-Communications, Inc. ("TCI"), which owns systems managed by Adelphia. The Class B Limited Partnership Interest has a preferred return annually which is payable on a current basis at the option of SHHH, and is senior in priority to the partnership interests of the Rigas family and TCI. Preferred return on the Class B Limited Partner Interest in SHHH totaled $2,645, $3,066 and $3,750 and is included in revenues for the years ended March 31, 1996, 1997 and 1998, respectively. During the year ended March 31, 1994, Adelphia made loans in the net amount of $15,000 to SHHH, to facilitate the acquisition of cable television systems serving Palm Beach County, Florida from unrelated parties. During fiscal year 1995, Adelphia sold its investment in Tele -Media Investment Partnership, L.P. ("TMIP") to SHHH for $13,000. On January 31, 1995, a wholly owned subsidiary of Adelphia received a $20,000 preferred investment from SHHH to facilitate the acquisition of TMV cable properties. Notes to Consolidated Financial Statements 3. DEBT: Subsidiary Debt March 31, 1997 1998 Notes to banks and institutions $ 1,159,500 $ 827,725 13% Senior Discount Notes of Hyperion due 2003 187,173 215,213 12.25% Senior Secured Notes of Hyperion due 2004 250,000 Other subsidiary debt 22,694 36,533 Total subsidiary debt $ 1,369,367 $ 1,329,471 Notes to Banks and Institutions The amount of borrowings available to Adelphia under its revolving credit agreements is generally based upon the subsidiaries achieving certain levels of operating performance. Adelphia had commit- ments from banks for additional borrowings of up to $235,620 at March 31, 1998 which expire through December 31, 2004. Adelphia pays commitment fees of up to .5% of unused principal. Borrowings under most of these credit arrangements of subsidiaries are collateralized by a pledge of the stock in their respective subsidiaries, and, in some cases, by other assets. These agreements limit, among other things, additional borrowings, investments, transactions with affiliates and other subsidiaries, and the payment of dividends and fees by the subsidiaries. The agreements also require maintenance of certain financial ratios by the subsidiaries. Several of the subsidiaries' agreements, along with the notes of the parent company, contain cross default provisions. At March 31, 1998, approximately $442,000 of the net assets of subsidiaries would be permitted to be transferred to the parent company in the form of dividends, priority return and loans without the prior approval of the lenders based upon the results of operations of such subsidiaries for the quarter ended March 31, 1998. The subsidiaries are permitted to pay management fees to the parent company or other subsidiaries. Such fees are limited to a percentage of the subsidiaries' revenues. A subsidiary of Adelphia is a co -borrower with a managed partnership under a $200,000 credit agreement. Each of the co -borrowers is liable for all borrowings under this credit agreement, although the lenders have no recourse against Adelphia other than against Adelphia's interest in such subsidiary. Notes to banks and institutions mature at various dates through 2005. Bank debt interest rates are based upon one or more of the following rates at the option of Adelphia: prime rate plus 0% to 1.75%; certificate of deposit rate plus 1.125% to 2.125%; or LIBOR plus .625% to 2.75%. Total bank debt with interest rates under these options was $813,200 and $644,000 at March 31, 1997 and 1998, respectively. At March 31, 1997 and 1998, the weighted average interest rate on notes payable to banks and institu- tions was 8.83% and 8.11%, respectively. At March 31, 1997 and 1998, the rates on 45.5% and 28.8%, respectively, of Adelphia's notes payable to banks and institutions were fixed for at least one year through the terms of the notes or interest rate swap agreements. During fiscal 1997, as a result of a bank refinancing, Adelphia recognized an extraordinary loss on early retirement of debt of $2,079 representing the write-off of unamortized debt financing costs. 13% Senior Discount Notes of Hyperion Due 2003 On April 15, 1996, Hyperion realized proceeds, net of discount, commissions and other transaction costs, of $168,600 upon issuance of $329,000 aggregate principal amount of unsecured 13% Senior Discount Notes due April 15, 2003 and 329,000 warrants expiring April 1, 2001 to purchase an aggre- gate of 1,993,638 shares of Class A Common Stock of Hyperion at $0.00308 per share. Proceeds of $11,087 were allocated to the value of the warrants. If all warrants were exercised, the warrants would represent approximately 3.73% of the common stock of Hyperion on a fully diluted basis. Proceeds were used to repay certain indebtedness to Adelphia, to make loans to certain key Hyperion officers and to fund Hyperion's expansion of its existing markets, to complete construction of new networks and to enter additional markets, including related capital expenditures, working capital requirements, operating losses and investments in joint ventures. Prior to April 15, 2001, interest on the notes is not payable in cash, but is added to principal. Thereafter, interest is payable semi-annually commencing 35 Adelphia Communications Corporation October 15, 2001. The notes contain restrictions on Hyperion regarding, among other things, limita- tions on additional borrowings, issuance of equity instruments, payment of dividends and other distributions, repurchase of equity instruments or subordinated debt, liens, transactions with affiliates, sales of assets, mergers and consolidations. On or before April 15, 1999 and subject to certain restric- tions, Hyperion may redeem, at its option, up to 25% of the aggregate principal amount of the notes at a price of 113% of the outstanding amount. On or after April 15, 2001, Hyperion may redeem, at its option, all or a portion of the notes at 106.5% of the outstanding amount, declining to par in 2002. 12.25% Senior Secured Notes of Hyperion Due 2004 On August 27, 1997, Hyperion issued $250,000 aggregate principal amount of 12.25% Senior Secured Notes due September 1, 2004. The notes are collateralized through the pledge of the common stock of certain of Hyperion's wholly-owned subsidiaries. Of the proceeds to Hyperion of approxi- mately $244,000, net of commissions and other transaction costs, $83,400 was invested in U.S. govern- ment securities and placed in an escrow account for payment in full when due of the first six scheduled semi-annual interest payments on the notes as required by the Indenture. The remainder of such proceeds will be used to fund the acquisition of increased ownership interests in certain of its networks, for capital expenditures, including the construction and expansion of new and existing networks, and for general corporate and working capital purposes. Interest is payable semi-annually commencing March 1, 1998. The notes contain restrictions and covenants similar to those pertaining to Hyperion's 13% Senior Discount Notes. On or before September 1, 2000 and subject to certain restric- tions, Hyperion may redeem, at its option, up to 25% of the aggregate principal amount of the notes at a price of 112.25% of principal with the net proceeds of one or more Qualified Equity Offerings (as defined in the Indenture). On or after September 1, 2001, Hyperion may redeem, at its option, all or a portion of the notes at 106.125% of principal which declines to par in 2003. Parent Debt Interest on the Parent Debt is due semi-annually. The Parent Debt is effectively subordinated to all liabilities of the subsidiaries and the agreements contain restrictions on, among other things, the incurrence of indebtedness, mergers and sale of assets, certain restricted payments by Adelphia, investments in affiliates and certain other affiliate transactions. The agreements further require that Adelphia maintain a ratio of debt to annualized operating cash flow not greater than 8.75 to 1.00, based on the latest fiscal quarter. Net proceeds from the issuance of notes during fiscal 1996, 1997, and 1998 were used to reduce amounts outstanding on Adelphia's subsidiaries' notes payable to banks and to purchase, redeem or otherwise retire a portion of 12.5% Notes due 2002. Outstanding as of March 31, Interest Issue Amount Maturity First Call First Call Rate Date Issued 1997 1998 Date Date Rate 10.25% 7/28/93 $110,000 $ 99,322 $ 99,504 7/15/00 Non -call N/A 12.5% (a) 5/14/92 400,000 277,385 69,838 5/15/02 5/15/97 106.00% 9.25% 9/25/97 325,000 — 325,000 10/1/02 Non -call N/A 9.5% (b) 2/15/94 150,000 197,897 186,347 2/15/04 2/15/99 103.56% 10.5% 7/07/97 150,000 — 150,000 7/15/04 Non -call N/A 11.875% 9/10/92 125,000 124,539 124,579 9/15/04 9/15/99 104.50% 9.875% 3/11/93 130,000 128,255 128,407 3/01/05 Non -call N/A 9.875% 2/26/97 350,000 347,274 347,446 3/01/07 Non -call N/A 8.375% 1/15/98 150,000 — 149,153 1/15/08 Non -call N/A $ 1,174,672 $1,580,274 (a) During fiscal 1997, $122,615 of notes were reacquired through open market purchases. As a result, Adelphia recognized an extraordinary loss on early retirement of debt of $9,631, which represents the excess of reacquisition cost over the net carrying value of the related debt. On October 31, 1997, Adelphia redeemed $202,000 aggregate principal amount of notes at 106% of principal and recognized an extraordinary loss on early retirement of debt of $13,461, which rep- resents the excess of reacquisition cost over the net carrying value of the related debt. On May 15, 1998, Adelphia redeemed the remaining $69,838 aggregate principal amount of notes at 103% of principal. (b) On or prior to February 1999, all interest on these Senior Pay -In -Kind notes may at the option of Adelphia be paid in cash or through the issuance of additional notes valued at 100% of their principal amount. The notes will bear cash interest from February 1999 through maturity. During fiscal 1998, $20,000 of notes were reacquired through open market purchases. As a result, Adelphia recognized an extraordinary gain on early retirement of debt of $2,136. 36 Notes to Consolidated Financial Statements Maturities of Debt The following table sets forth the mandatory reductions in principal under all debt agreements for each of the next five years based on amounts outstanding at March 31, 1998: Year ending March 31, 1999 $ 128,213 Year ending March 31, 2000 50,268 Year ending March 31, 2001 169,288 Year ending March 31, 2002 157,740 Year ending March 31, 2003 573,091 The Company intends to fund its requirements for maturities of debt through borrowings under new and existing credit arrangements and internally generated funds. Changing conditions in the financial markets may have an impact on how Adelphia will refinance its debt in the future. Interest Rate Swaps and Caps Adelphia has entered into interest rate swap agreements and interest rate cap agreements with banks, Olympus and Managed Partnerships (see Note 10) to reduce the impact of changes in interest rates on its debt. Several of Adelphia's credit arrangements include provisions which require interest rate protection for a portion of its debt. Adelphia enters into pay -fixed agreements to effectively convert a portion of its variable-rate debt to fixed-rate debt to reduce the risk of incurring higher interest costs due to rising interest rates. Adelphia enters into receive -fixed agreements to effectively convert a portion of its fixed-rate debt to a variable-rate debt which is indexed to LIBOR to reduce the risk of incurring higher interest costs in periods of falling interest rates. Interest rate cap agreements are used to reduce the impact of increases in interest rates on variable rate debt. Adelphia is exposed to credit loss in the event of nonperformance by the banks, by Olympus or by the managed entities. Adelphia does not expect any such nonperformance. The following table summarizes the notional amounts outstanding and weighted average interest rate data, based on variable rates in effect at March 31, 1997 and 1998, for these swaps and caps, all of which expire through 1999. March 31, 1997 1998 Pay fixed swaps: Notional amount $ 340,000 $ 315,000 Average receive rate 5.67% 5.87% Average pay rate 7.64% 7.42% Receive fixed swaps: Notional amount $ 35,000 $ 35,000 Average receive rate 5.68% 5.68% Average pay rate 5.50% 5.91% Interest rate caps: Notional amount $ 165,000 $ 190,000 Average cap rate 8.30% 8.13% 37 Adelphia Communications Corporation 4. REDEEMABLE PREFERRED STOCK: 12.875% Hyperion Redeemable Exchangeable Preferred Stock On October 9, 1997, Hyperion issued $200,000 aggregate liquidation preference of 12.875% Senior Exchangeable Redeemable Preferred Stock due October 15, 2007. Proceeds to Hyperion will be used to fund the acquisition of increased ownership interests in certain of its networks, for capital expendi- tures, including the construction and expansion of new and existing networks, and for general corporate and working capital purposes. Dividends are payable quarterly commencing January 15, 1998 at 12.875% of the liquidation preference of outstanding preferred stock. Through October 15, 2002, dividends are payable in cash or additional shares of preferred stock at Hyperion's option. Subsequent to October 15, 2002, dividends are payable in cash. The preferred stock ranks junior in right of payment to all indebtedness of Hyperion, its Subsidiaries and Joint Ventures. On or before October 15, 2000, and subject to certain restrictions, Hyperion may redeem, at its option, up to 35% of the initial aggregate liquidation prefer- ence of the preferred stock originally issued with the net cash proceeds of one or more Qualified Equity Offerings (as defined in the Certificate of Designation) at a redemption price equal to 112.875% of the liquidation preference per share of the preferred stock, plus, without duplication, accumulated and unpaid dividends to the date of redemption; provided that, after any such redemption, there are remaining outstanding shares of preferred stock having an aggregate liquidation preference of at least 65% of the initial aggregate liquidation preference of the preferred stock originally issued. On or after October 15, 2002, Hyperion may redeem, at its option, all or a portion of the preferred stock at 106.438% of the liquidation preference thereof declining to 100% of the liquidation preference in 2005. Hyperion is required to redeem all of the shares of preferred stock outstanding on October 15, 2007 at a redemption price equal to 100% of the liquidation preference thereof, plus, without duplication, accumulated and unpaid dividends to the date of redemption. The preferred stock contain restrictions and covenants similar to Hyperion's 13% Senior Discount Notes. Hyperion may, at its option, on any dividend payment date, exchange in whole, but not in part, the then outstanding shares of preferred stock for 12.875% Senior Subordinated Debentures due October 15, 2007 which have provisions consistent with the provisions of the preferred stock. Hyperion satisfied the dividend requirements on this preferred stock by issuing 6,860 additional shares of Preferred Stock in January 1998. 13% Exchangeable Redeemable Preferred Stock On July 7, 1997, Adelphia issued $150,000 aggregate liquidation preference of 13% Cumulative Exchangeable Preferred Stock due July 15, 2009. Proceeds were used to reduce amounts outstanding on Adelphia's subsidiaries' notes payable to banks and institutions. Dividends are payable semi-annually commencing January 15, 1998 at 13% of the liquidation preference of outstanding preferred stock. Dividends are payable in cash with any accumulated unpaid dividends bearing interest at 13% per annum. The preferred stock ranks junior in right of payment to all indebtedness of Adelphia. On or before July 15, 2000, Adelphia may redeem, at its option, up to 33% of the initial aggregate liquidation preference of the preferred stock originally issued with the net cash proceeds of one or more common equity offerings at a redemption price equal to 113% of the liquidation preference per share of the preferred stock, plus, without duplication, accumulated and unpaid dividends to the date of redemption; provided that, after any such redemp- tion, there are remaining outstanding shares of preferred stock having an aggregate liquidation preference of at least 67% of the initial aggregate liquidation preference of the preferred stock origi- nally issued. On or after July 15, 2002, Adelphia may redeem, at its option, all or a portion of the preferred stock at 106.500% of the liquidation preference thereof declining to 100% of the liquidation preference in 2008. Adelphia is required to redeem all of the shares of preferred stock outstanding on July 15, 2009 at a redemption price equal to 100% of the liquidation preference thereof, plus, without duplication, accumulated and unpaid dividends to the date of redemption. The preferred stock contains restrictions and covenants similar to Adelphia's parent debt. Adelphia may, at its option, on any dividend payment date, exchange in whole or in part (subject to certain restrictions), the then outstanding shares of preferred stock for 13% Senior Subordinated Exchange Debentures due July 15, 2009 which have provisions consistent with the provisions of the preferred stock. The Company paid cash dividends on this preferred stock of $10,183 during the year ended March 31, 1998. 38 Notes to Consolidated Financial Statements 5. COMMITMENTS AND CONTINGENCIES: Adelphia rents office and studio space, tower sites, and space on utility poles under leases with terms which are generally less than one year or under agreements that are generally cancelable on short notice. Total rental expense under all operating leases aggregated $4,687, $6,232 and $7,420 for the years ended March 31, 1996, 1997 and 1998, respectively. In connection with certain obligations under franchise agreements, Adelphia obtains surety bonds guaranteeing performance to municipalities and public utilities. Payment is required only in the event of nonperformance. Management believes Adelphia has fulfilled all of its obligations such that no payments under surety bonds have been required. On January 8, 1998, Adelphia signed a definitive agreement to establish a partnership into which Tele-Communications, Inc. ("TCI") will contribute its cable systems in Buffalo, New York; Erie, Pennsylvania; and Ashtabula and Lake County, Ohio, totaling approximately 166,000 subscribers, and Adelphia will contribute its Western New York and Lorain, Ohio systems, totaling approximately 298,000 subscribers. Upon closing of the transaction, TCI will hold a minority interest in the partnership. Adelphia will manage the partnership and will consolidate the partnership's results for financial reporting purposes. The Company expects that the transaction will close prior to September 30, 1998. On March 2, 1998, Adelphia entered into a definitive agreement for the purchase of cable televi- sion systems from Marcus Cable, Inc. These systems will be acquired for $150,000 cash and serve approximately 62,000 subscribers in Connecticut and Virginia. The acquisition, which will be accounted for under the purchase method of accounting, is expected to close during fiscal year 1999. The cable television industry and Adelphia are subject to extensive regulation at the federal, state and local levels. Pursuant to the 1992 Cable Act, which significantly expanded the scope of regulation of certain subscriber rates and a number of other matters in the cable industry the FCC has adopted rate regulations that establish, on a system -by -system basis, maximum allowable rates for (i) basic and cable programming services (other than programming offered on a per -channel or per -program basis), based upon a benchmark methodology, or, in the alternative, a cost of service showing, and (ii) associated equipment and installation services based upon cost plus a reasonable profit. Under the FCC rules, franchising authorities are authorized to regulate rates for basic services and associated equipment and installation services, and the FCC will regulate rates for regulated cable programming services in response to complaints filed with the agency. The original rate regulations became effective on September 1, 1993. Several amendments to the rate regulations have subsequently been added. The FCC has adopted regulations implementing all of the requirements of the 1992 Cable Act. The FCC is also likely to continue to modify, clarify or refine the rate regulations. The Telecommunications Act of 1996 (the "1996 Act") deregulates the rates for cable programming services on March 31, 1999. Adelphia cannot predict the effect or outcome of the future rulemaking proceedings, changes to the rate regulations, or litigation. 6. CONVERTIBLE PREFERRED STOCIC COMMON STOCK AND OTHER STOCKHOLDERS' EQUITY (DEFICIENCY): Convertible Preferred Stock On July 7, 1997, Adelphia issued 100,000 shares of 8.125% Series C Cumulative Convertible Preferred Stock with a par value of $.01 per share and an aggregate liquidation preference of $100,000 of which $80,000 was sold to a Rigas family affiliate and the remainder was sold to a wholly owned subsidiary of FPL Group, Inc., an affiliate of Olympus. The preferred stock accrues dividends at the rate of 8.125% of the liquidation preference per annum, and is convertible at $8.48 per share into an aggregate of 11,792,450 shares of Class A Common Stock of Adelphia. The preferred stock is redeemable at the option of Adelphia on or after August 1, 2000 at 104% of the liquidation preference declining to 100% of the liquidation preference in 2002. The Company paid cash dividends on this preferred stock of $4,605 during the year ended March 31, 1998. Common Stock Issued On April 3, 1995, Olympus purchased from Adelphia, through a charge to its receivable balance with Adelphia, 457,300 shares of Adelphia Class A Common Stock for $5,000. Olympus used the stock in the acquisition of the cable and security systems of WB Cable Associates, Ltd. On February 10, 1997, Adelphia issued 766,871 shares of Class A Common Stock in connection with the acquisition of Small Cities (see Note 1). 39 Adelphia Communications Corporation On June 20, 1997, Adelphia issued 3,571,428 shares of Class A Common Stock in connection with the acquisition of Booth (see Note 1). On March 6, 1998, Adelphia issued 341,220 shares of Class A Common Stock in connection with exercising its option to purchase the remaining 15% of its Northeast Cable, Inc. system (see Note 1). The Certificate of Incorporation of Adelphia authorizes two classes of common stock, Class A and Class B. Holders of Class A Common Stock and Class B Common Stock vote as a single class on all matters submitted to a vote of the stockholders, with each share of Class A Common Stock entitled to one vote and each share of Class B Common Stock entitled to ten votes, except (i) for the election of directors and (ii) as otherwise provided by law. In the annual election of directors, the holders of Class A Common Stock voting as a separate class, are entitled to elect one of Adelphia's directors. In addition, each share of Class B Common Stock is automatically convertible into a share of Class A Common Stock upon transfer, subject to certain limited exceptions. In the event a cash dividend is paid, the holders of Class A Common Stock will be paid 105% of the amount payable per share for each share of Class B Common Stock. Upon liquidation, dissolution or winding up of Adelphia, the holders of Class A Common Stock are entitled to a preference of $1.00 per share. After such amount is paid, holders of Class B Common Stock are entitled to receive $1.00 per share. Any remaining amount would then be shared ratably by both classes. Restricted Stock Bonus Plan Adelphia has reserved 500,000 shares of Class A Common Stock for issuance to officers and other key employees at the discretion of the Compensation Committee of the Board of Directors. The bonus shares will be awarded without any cash payment by the recipient unless otherwise determined by the Compensation Committee. Shares awarded under the plan vest over a five year period. No awards have been made under the plan. Stock Option Plan Adelphia has a stock option plan, which provides for the granting of options to purchase up to 200,000 shares of Adelphia's Class A Common Stock to officers and other key employees of Adelphia and its subsidiaries. Options may be granted at an exercise price equal to the fair market value of the shares on the date of grant. The plan permits the granting of tax -qualified incentive stock options, in addition to non-qualified stock options. Options outstanding under the plan may be exercised by paying the exercise price per share through various alternative settlement methods. No stock options have been granted under the plan. Z EMPLOYEE BENEFIT PLANS: Savings Plan Adelphia has a savings plan (401(k)) which provides that eligible full-time employees may contribute from 3% to 16% of their pre-tax compensation subject to certain limitations. Adelphia makes matching contributions not exceeding 1.5% of each participant's pre-tax compensation. Adelphia's matching contributions amounted to $350, $638 and $687 for the years ended March 31, 1996, 1997 and 1998, respectively. Hyperion Long -Term Incentive Compensation Plan On October 3, 1996, Hyperion adopted its 1996 Long -Term Incentive Compensation Plan (the "1996 Plan"). The 1996 Plan provides for the granting of (i) options which qualify as "incentive stock options" within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended, (ii) options which do not so qualify, (iii) share awards (with or without restrictions on vesting), (iv) stock appreciation rights and (v) stock equivalent or phantom units. The number of shares of Hyperion Class A Common Stock available for issuance initially was 5,687,500. Such number is to increase each year by 1% of outstanding shares of all classes of Hyperion Common Stock, up to a maximum of 8,125,000 shares. Options, awards and units may be granted under the 1996 Plan to directors, officers, employees and consultants. The 1996 Plan provides that incentive stock options must be granted with an exercise price of not less than the fair market value of the underlying Hyperion Common Stock on the date of grant. Options outstanding under the Plan may be exercised by paying the exercise price per share through various alternative settlement methods. On March 4, 40 Notes to Consolidated Financial Statements 1997 and April 1, 1997 and 1998, Hyperion issued 338,000 shares, 58,500 shares and 58,500 shares, respectively, of its Class A Common Stock to Daniel R. Milliard pursuant to his employment agreement with Hyperion. In April 1998 and in recognition for valuable past service to Hyperion and as an incentive for future services, Hyperion authorized the issuance under the 1996 Plan to each of John J. Rigas, Michael J. Rigas, Timothy J. Rigas and James P. Rigas of (i) stock options (the "Rigas Options") covering 100,000 shares of Hyperion Class A Common Stock, which options will vest in equal one-third amounts on the third, fourth and fifth year anniversaries of grant (vesting conditioned on continued service as an employee or director) and which shall be exercisable at $15.00 per share and (ii) phantom stock awards (the "Rigas Grants") covering 100,000 shares of Hyperion Class A Common Stock, which phantom awards will vest in equal one-third amounts on the third, fourth and fifth year anniversaries of grant (vesting conditioned on continued service as an employee or director). Also in April 1998, pursuant to an existing stockholders agreement, Hyperion authorized the issuance under the 1996 Plan to certain members of Hyperion's management stock options (the "Management Stockholder Options") covering 13,047 shares of Hyperion Class A Common Stock with exercise price and vesting terms identical to the Rigas Options. In addition to the Rigas Options, the Rigas Grants, the Management Stockholder Options and the stock options or share awards to be issued to Daniel R. Milliard under his employment agreement, Hyperion currently expects to issue under the 1996 Plan stock options, restrictive stock grants, phantom stock awards or other awards to other 1996 Plan partic- ipants covering up to a total of 325,000 shares of Hyperion Class A Common Stock during fiscal 1999. 8. TAXES ON INCOME: Adelphia and its corporate subsidiaries file a consolidated federal income tax return, which includes its share of the subsidiary partnerships and joint venture partnership results. At March 31, 1998, Adelphia had net operating loss carryforwards for federal income tax purposes of approxi- mately $1.2 billion expiring through 2013. Depreciation and amortization expense differs for tax and financial statement purposes due to the use of prescribed periods rather than useful lives for tax purposes and also as a result of differences between tax basis and book basis of certain acquisitions. The tax effects of significant items comprising Adelphia's net deferred tax liability are as follows: March 31, 1997 1998 Deferred tax liabilities: Differences between book and tax basis of property, plant and equipment and intangible assets $ 233,998 $ 250,298 Deferred tax assets: Investment in partnerships 55,786 82,461 Operating loss carryforwards 427,400 459,546 483,186 542,007 Valuation allowance (359,285) (408,060) Subtotal 123,901 133,947 Net deferred tax liability $ 110,097 $ 116,351 The net change in the valuation allowance for the years ended March 31, 1997 and 1998 was an increase of $57,800 and $48,775, respectively. Income tax benefit is as follows: March 31, 1996 1997 1998 Current $ (1,144) $ (142) $ (699) Deferred 3,930 500 6,305 Total $ 2,786 $ 358 $ 5,606 41 Adelphia Communications Corporation A reconciliation of the statutory federal income tax rate and Adelphia's effective income tax rate is as follows: Year Ended March 31, 1996 1997 1998 Statutory federal income tax rate 35% 35% 35% Change in valuation allowance (37%) (41%) (26%) State taxes, net of federal benefit (1%) 6% (1%) Other 5% -% (5%) Effective income tax benefit rate 2% -% 3% 9. DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS: Included in Adelphia's financial instrument portfolio are cash, notes payable to banks and institutions, debentures, redeemable preferred stock and interest rate swaps and caps. The carrying values of notes payable to banks and institutions approximate their fair values at March 31, 1997 and 1998. The carrying cost of the publicly traded notes, debentures and redeemable preferred stock at March 31, 1997 and 1998 were $1,361,845 and $2,400,753, respectively. At March 31, 1997, the carrying cost exceeded the fair value by $46,828. At March 31, 1998, the fair value exceeded the carrying cost by $199,296. At March 31, 1997 and 1998, Adelphia would have been required to pay approximately $7,632 and $5,822, respectively, to settle its interest rate swap and cap agreements, representing the excess of carrying cost over fair value of these agreements. The fair values of the debt, redeemable preferred stock and interest rate swaps and caps were based upon quoted market prices of similar instruments or on rates available to Adelphia for instruments of the same remaining maturities. 10. BUSINESS SEGMENT INFORMATION: Refer to pages 13 and 14 for information regarding business segments for fiscal 1996, 1997 and 1998. 11. RELATED PARTY TRANSACTIONS: Adelphia currently manages cable television systems which are principally owned by Olympus and limited partnerships in which certain of Adelphia's principal shareholders who are executive officers have equity interests. Adelphia has agreements with Olympus and the Managed Partnerships which provide for the payment of fees to Adelphia. The aggregate fee revenues from Olympus and the Managed Partnerships amounted to $2,700, $2,939 and $3,960 for the years ended March 31, 1996, 1997 and 1998, respectively. In addition, Adelphia was reimbursed by Olympus and the Managed Partnerships for allocated corporate costs of $7,517, $6,335 and $6,436 for the years ended March 31, 1996, 1997 and 1998, respectively, which have been recorded as a reduction of selling, general and administrative expense. Adelphia leases from a partnership owned by principal shareholders who are executive officers certain buildings under operating leases. Rent expense under these operating leases aggregated $127, $133 and $104 for the years ended March 31, 1996, 1997 and 1998, respectively. Interest expense -net includes interest income from affiliates for long term borrowings of $10,623, $8,367 and $7,129 for the years ended March 31, 1996, 1997 and 1998, respectively, and for short term borrowings of $9,340 for the year ended March 31, 1998. Adelphia had interest rate swaps with affiliates for a notional amount of $175,000 for the years ended March 31, 1997 and 1998. Adelphia had $140,000 of pay fixed swaps with Olympus and $35,000 of received fixed swaps with the Managed Partnerships for the years ended March 31, 1997 and 1998. These swaps expire at various dates in 1998. The net effect of these interest rate swaps was to increase interest expense by $826, $50 and $128 for the years ended March 31, 1996, 1997 and 1998, respectively. During the years ended March 31, 1997 and 1998, respectively, Adelphia paid $2,563 and $2,485 to entities owned by certain shareholders of Adelphia primarily for property, plant and equipment and services. 42 Notes to Consolidated Financial Statements 12. QUARTERLY FINANCIAL DATA (UNAUDITED): The following tables summarize the financial results of Adelphia for each of the quarters in the years ended March 31, 1997 and 1998: Three Months Ended Year Ended March 31, 1997: June 30 September 30 December 31 March 31 Revenues $ 111,011 $ 117,437 $ 122,127 $ 122,203 Operating expenses Direct operating and programming 33,597 35,864 39,005 40,516 Selling, general and administrative 18,638 20,175 22,319 20,631 Depreciation and amortization 28,477 30,262 30,813 34,514 Total 80,712 86,301 92,137 95,661 Operating income 30,299 31,136 29,990 26,542 Other income (expense) Priority investment income from Olympus 9,817 10,273 10,542 11,454 Interest expense -net (58,447) (58,806) (57,201) (57,871) Equity in loss of Olympus and other joint ventures (13,011) (11,916) (14,061) (12,958) Equity in loss of Hyperion joint ventures (1,636) (1,362) (2,145) (2,080) Gain on sale of investments 8,405 3,746 Total (54,872) (61,811) (62,865) (57,709) Loss before income taxes and extraordinary loss (24,573) (30,675) (32,875) (31,167) Income tax (expense) benefit (166) 175 53 294 Loss before extraordinary loss (24,739) (30,500) (32,820) (30,873) Extraordinary loss on early retirement of debt (2,079) (9,631) Net loss $ (26,818) $ (30,500) $ (32,820) $ (40,504) Basic and diluted loss per weighted average share of common stock before extraordinary loss $ (0.94) $ (1.16) $ (1.25) $ (1.15) Basic and diluted extraordinary loss per weighted average share on early retirement of debt (0.08) (0.36) Basic and diluted net loss per weighted average share of common stock $ (1.02) " $ (1.16) $ (1.25) $ (1.51) Weighted average shares of common stock outstanding (in thousands) 26,308 26,308 26,308 26,726 43 Adelphia Communications Corporation Three Months Ended Year Ended March 31, 1998: June 30 September 30 December 31 March 31 Revenues $122,644 $ 128,990 $ 138,271 $ 138,537 Operating expenses Direct operating and programming 39,673 38,540 43,711 45,364 Selling, general and administrative 22,259 23,472 24,354 25,646 Depreciation and amortization 33,733 33,586 37,251 40,471 Total 95,665 95,598 105,316 111,481 Operating income 26,979 33,392 32,955 27,056 Other income (expense) Priority investment income from Olympus 11,765 12,000 12,000 12,000 Interest expense -net (61,737) (62,432) (63,172) (59,766) Equity in loss of Olympus and other joint ventures (19,198) (14,840) (16,012) (16,039) Equity in loss of Hyperion joint ventures (2,540) (3,886) (2,858) (3,683) Hyperion preferred stock dividends - (5,988) (6,694) Gain on sale of investments 610 408 1,520 Total (71,710) (68,548) (75,622) (72,662) Loss before income taxes and extraordinary gain (loss) (44,731) (35,156) (42,667) (45,606) Income tax benefit (expense) 70 (365) (264) 6,165 Loss before extraordinary gain (loss) (44,661) (35,521) (42,931) (39,441) Extraordinary gain (loss) on early retirement of debt 2,300 (13,625) Net loss (42,361) (35,521) (56,556) (39,441) Dividend requirements applicable to preferred stock (4,550) (7,448) (6,852) Net loss applicable to common stockhoders $ (42,361) $ (40,071) $ (64,004) $ (46,293) Basic and diluted loss per weighted average share of common stock before extraordinary gain (loss) $ (1.62) $ (1.31) $ (1.64) $ (1.51) Basic and diluted extraordinary gain (loss) per weighted average share on early retirement of debt 0.08 (0.45) Basic and diluted net loss per weighted average share of common stock $ (1.54) $ (1.31) $ (2.09) $ (1.51) Weighted average shares of common stock outstanding (in thousands) 27,468 30,647 30,647 30,730 44 Notes to Consolidated Financial Statements 13. SUBSEQUENT EVENTS: On April 1, 1998, the Company completed an exchange of cable systems with Time Warner. The Company exchanged its interests in Mansfield, Ohio area systems, which served approximately 64,400 subscribers for cash and interests in systems adjacent to systems owned or managed by Adelphia in Virginia, New England and New York, which served approximately 70,200 subscribers. On May 8, 1998, Hyperion completed an initial public offering ("IPO") of its Class A Common Stock ("Hyperion Stock"). As part of the offering, Adelphia purchased an incremental 3,324,001 shares of Hyperion Stock for $49,900 and converted indebtedness owed to the Company by Hyperion into 3,642,666 shares of Hyperion Stock. Adelphia owns approximately 66% of the Hyperion common stock on a fully diluted basis and 85% of the total voting power. Additional net proceeds of approximately $192,000 to Hyperion were received as a result of the sale of Hyperion Stock to the public. On May 15, 1998, Adelphia redeemed $69,838 aggregate principal amount of 12.5% Senior Notes due 2002 at 103% of principal. 45 Adelphia Communications Corporation STOCKHOLDER INFORMATION ANNUAL MEETING OF STOCKHOLDERS The 1998 annual meeting of stockholders of Adelphia Communications Corporation will be held at 10 a.m. on Tuesday, October 6, 1998 at the Coudersport Theatre, Main Street, Coudersport, Pennsylvania. COMMON STOCK INFORMATION Adelphia's Class A Common Stock is listed for trading on the National Association of Securities Dealers Automated Quotations System National Market System (NASDAQ -NMS). Adelphia's NASDAQ - NMS symbol is "ADLAC." The following table sets forth the range of high and low closing bid prices of the Class A Common Stock on NASDAQ -NMS. Such bid prices represent inter -dealer quotations, without retail mark-up, mark-down or commission, and may not necessarily represent actual transactions. CLASS A COMMON STOCK QUARTER ENDED HIGH LOW June 30, 1996 $ 7 �/8 $ 6946 September 30, 1996 $ 11 $ 61/2 December 31, 1996 $ 101/a $ 53/4 March 31, 1997 $ 71/8 $ 5 3/8 June 30, 1997 $ 73/4 $ 5 September 30, 1997 $ 121/8 $ 634 December 31, 1997 $ 183/4 $ 12 March 31, 1998 $ 303/8 $ 163/8 As of June 24, 1998, there were approximately 162 holders of record of Adelphia's Class A Common Stock, of which two record holders were registered clearing agencies holding Class A Common Stock on behalf of participants in such clearing agencies. No established public trading market exists for Adelphia's Class B Common Stock. As of June 24, 1998, the Class B Common Stock was held of record by seven persons, principally members of the Rigas family, including a Pennsylvania general partnership all of whose partners are members of the Rigas family. The Class B Common Stock is convertible into shares of Class A Common Stock on a one-to-one basis. As of June 24, 1998, the Rigas family owned 99.1% of the outstanding Class B Common Stock. DIVIDEND POLICY Adelphia has never paid a cash dividend on its common stock and anticipates that for the foreseeable future any earnings will be retained for use in its business. The ability of Adelphia to pay cash dividends on its common stock is limited by the provisions of its indentures. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources." SECURITIES EXCHANGE ACT REGISTRATION Adelphia Communications Corporation's Class A Common Stock is registered pursuant to Section 12(g) of the Securities Act of 1934. ANNUAL REPORT ON FORM 10-K AND EXHIBITS Copies of Adelphia's Annual Report on Form 10-K (excluding exhibits) for the fiscal year ended March 31, 1998, as filed with the Securities and Exchange Commission, will be furnished free of charge, upon written request, to stockholders who have not previously received a copy from Adelphia. In addition, Adelphia will furnish any exhibit to its Annual Report on Form 10-K upon payment of a fee limited to Adelphia's reasonable expenses in furnishing such exhibit upon written request. Written requests may be directed to the Secretary, Adelphia Communications Corporation, Main at Water Street, Coudersport, Pennsylvania 16915. 46 Stockholder Information REGISTRAR AND TRANSFER AGENT The registrar and transfer agent for Adelphia is American Stock Transfer & Trust Company. All correspondence concerning stock transfers should be directed to them at 40 Wall Street, New York, New York 10005-2392. INDEPENDENT AUDITORS Adelphia's independent auditors' are Deloitte & Touche LLP, 2500 One PPG Place, Pittsburgh, Pennsylvania 15222-5401. EXECUTIVE OFFICES Adelphia's executive offices are located at Main at Water Street, Coudersport, Pennsylvania 16915-0472 (telephone 814-274-9830). 47 Adelphia Communications Corporation BOARD OF DIRECTORS & EXECUTIVE OFFICERS Dermis P. Coyle* GENERAL COUNSEL AND SECRETARY, FPL GROUP, INC. AND FLORIDA POWER & LIGHT COMPANY Pete J. Metros* PRESIDENT, RAPISTAN DEMAG CORPORATION James L. Gray** Daniel R. Milliard SENIOR VICE PRESIDENT AND CORPORATE SECRETARY ADELPHIA COMMUNICATIONS CORPORATION; PRESIDENT AND CHIEF OPERATING OFFICER, HYPERION TELECOMMUNICATIONS, INC. * Director only Perry S. Patterson* ATTORNEY-AT-LAW John J. Rigas CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER, ADELPHIA COMMUNICATIONS CORPORATION; CHAIRMAN, HYPERION TELECOMMUNICATIONS, INC. Michael J. Rigas EXECUTIVE VICE PRESIDENT, OPERATIONS, ADELPHIA COMMUNICATIONS CORPORATION; VICE CHAIRMAN, HYPERION TELECOMMUNICATIONS, INC. ** Hyperion Telecommunications, Inc., Director only CORPORATE MANAGEMENT Jeffrey L. Abbas SENIOR DIRECTOR OF PROGRAMMING John A. Abplanalp DIRECTOR OF PROGRAMMING Anthony Accamando, Jr. VICE PRESIDENT, COMMUNITY AFFAIRS John M. Adduci DIRECTOR OF CABLE ENTERTAINMENT W. David Anderson DIRECTOR OF CALL CENTER OPERATIONS Charles A. Balestri DIRECTOR OF MARKETING INFORMATION Larry Brett CORPORATE DIRECTOR OF OPERATIONS James R. Brown VICE PRESIDENT, FINANCE Leslie J. Brown ASSISTANT GENERAL COUNSEL Carmen Cipolla SENIOR DIRECTOR OF DATA OPERATIONS Jeffrey W. Donahue DIRECTOR OF VOICE AND DATA SERVICES Randall D. Fisher VICE PRESIDENT, LEGAL AFFAIRS, GENERAL COUNSEL AND ASSISTANT CORPORATE SECRETARY Timothy J. Rigas EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER AND TREASURER, ADELPHIA COMMUNICATIONS CORPORATION; VICE CHAIRMAN, CHIEF FINANCIAL OFFICER AND TREASURER, HYPERION TELECOMMUNICATIONS, INC. James P. Rigas EXECUTIVE VICE PRESIDENT, STRATEGIC PLANNING, ADELPHIA COMMUNICATIONS CORPORATION; VICE CHAIRMAN AND CHIEF EXECUTIVE OFFICER, I IYPERION TELECOMMUNICATIONS, INC. John B. Glicksman DEPUTY GENERAL COUNSEL FOR OPERATIONS Jeremy P. Harris VICE PRESIDENT OF MARKETING AND SALES Edward J. Hartman DIRECTOR OF FINANCE Luke P. Healy DIRECTOR OF ACCOUNTING Colin H. Higgin DEPUTY GENERAL COUNSEL AND ASSISTANT CORPORATE SECRETARY Athena Jamesson ASSISTANT GENERAL COUNSEL James M. Kane VICE PRESIDENT, CORPORATE DEVELOPMENT Orby G. Kelley, Jr. VICE PRESIDENT, ADMINISTRATION/LABOR RELATIONS William C. Kent CORPORATE DIRECTOR OF OPERATIONS Clair LaBrunerie VICE PRESIDENT, INTERNATIONAL DEVELOPMENT Thomas J. Lamb SENIOR DIRECTOR OF MANAGEMENT INFORMATION SYSTEMS SYSTEM MANAGEMENT New England Robert L. Snowdon James C. Sweeney Coastal New Jersey William B. Scott Ohio Sebio DiLuciano Pennsylvania Lou A. Abraham John F. Bradley, Jr. Richard B. Conrad Robert N. Hymson Chuck Redpath Southeastern Florida Mark P. Galloway Lynn Whisenhunt John Wattick Daniel R. Liberator VICE PRESIDENT, ENGINEERING Dean R. Marshall DIRECTOR OF FINANCE Michael C. Mulcahey DIRECTOR OF ACCOUNTING AND ASSISTANT TREASURER Jack A. Olson VICE PRESIDENT, MEDIA DEVELOPMENT Kenneth L. Proud DIRECTOR OF PROJECT MANAGEMENT Jorge D. Salinger DIRECTOR OF DIGITAL SERVICES AND NETWORKING Craig Schmid DIRECTOR OF RATE REGULATION Joseph Selvage DIRECTOR OF NETWORK CATV DEVELOPMENT Herb Stortz DIRECTOR OF MANAGEMENT INFORMATION SYSTEMS Robert G. Wahl CORPORATE DIRECTOR OF OPERATIONS Andy White DIRECTOR OF HIGH SPEED DATA OPERATIONS Virginia Dell A. Hanley Joseph Price Western New York Thomas M. Haywood Vincent Laurendi, Jr MANAGEMENT OF HYPER/ON TELECOMMUNICATIONS, INC. Thomas W. Cady VICE PRESIDENT, SALES AND MARKETING Charles R. Drenning SENIOR VICE PRESIDENT, ENGINEERING OPERATIONS 48 John D. Lasater VICE PRESIDENT, NATIONAL ACCOUNTS Randolph S. Fowler SENIOR VICE PRESIDENT, BUSINESS DEVELOPMENT AND REGULATORY AFFAIRS Edward E. Babcock VICE PRESIDENT, FINANCE AND CHIEF ACCOUNTING OFFICER Theodore A. Huf VICE PRESIDENT, ENGINEERING neltzhlia Main at Water Street Coudersport, PA 16915-1141 Phone: 814.274.9830 Fax: 814.274.8631 www.adelphia.corn Cable & Your VCR "Straight" Connection (Watch and record the same channel.) This is the most popular method of hooking up your VCR. The cable signal passes through the converter box first, the VCR second, and then into the television. This method will allow you to view and record the channel you are watching. VCR TV COAXIAL CABLE CONVERTER "Cable -Ready VCR" Connection (Record any non -premium cable channel while watching any channel.) This type of hookup will allow you to tape your non -premium cable channels while watching any premium channel. Premium channels will only be unscrambled by the converter box. Your cable -ready VCR will accept the non -premium cable channels but not the premium channels; therefore, you cannot record a premium channel. CONVERTER TV COAXIAL CABLE How to Hook Up Your VCR "Cable -Ready TV" Connection (Record any channel while watching a non -premium cable channel.) This method of Cable/VCR hookup will allow you to tape your premium channel while watching a non -premium cable channel. Premium channels will only be unscrambled by the converter box. Your cable -ready television will accept any non- premium cable channel but not the premium channels. (To receive the premium channels on both your VCR and your television, you would need an additional converter box.) SPLITTER COAXIAL CABLE TV CONVERTER VCR "Deluxe" Connection (Record any channel while watching any channel.) This hookup will allow you to watch any channel and record any other channel. This type of cable installation requires a second converter box. For additional information on the second converter, call your local Adelphia office. SPLITTER COAXIAL CABLE CONVERTER TV CONVERTER VCR Reading Your Adelphia Bill • This is the total amount you owe for service through the time period in 8 below. ® Payment in full should reach us by the "date due" each month. ® It is not necessary to enter an amount unless it differs from the balance due. CDBe sure your name and address are correct. • Be sure the Adelphia return address shows through the reply envelope window. ® Tear along this perforation and return only the top portion with your payment. Use the return envelope provided. • This is your account number. 0 This is the billing period. It shows the billed from and billed to dates. Dates may vary depending on your billing cycle. Any payment received and processed after this date will appear on your next bill. This area displays all current and advance charges pertaining to your service. Sales tax and/or franchise tax fees are also charged in some states. ® This area shows Adelphia phone numbers to be used to call regarding service changes or problems and/or billing questions. ® This area is used for important messages concerning your service. ® This area is used for important promotional messages and special offers from Adelphia. The back of the bill will contain your FCC community ID# and name and address of your franchise authority. . Picture Quality Many picture quality problems do not require a visit by a technician. You may be able to eliminate the need to call Adelphia by using the checklist below, or by examining the picture quality chart on this page. Here are a few things to check before calling for repair service. • Is your reception problem on all channels? If not, it could be a temporary station broadcasting problem. • Are your cable connections in the back of your TV tightly secured? • Have you tried fine-tuning your TV set? To fine-tune your set manually, turn off your AFT (automatic fine-tune). Tune your TV to the designated output channel. If the picture or sound is not clear, refer to your owner's manual for fine-tuning procedures. Turn AFT back on. If you're still experiencing problems, consult the chart below. Call your TV repairman Rolling screen Call Adelphia Horizontal shrinking Elongated or tilted picture Vertical shrinking Picture but no sound Dark moving line or herringbone pattern Ghosts or double image Snowy white picture with no sound Flecks or dots appear on the pciture "Windshield wipe" effect General Information How Cable Works Adelphia collects signals at a reception site. The signals are processed at various relay stations where they are electronically strengthened and transmitted over large "trunk" cables, fiber optic lines, and smaller "feeder" cables which carry the signal to your TV set. Converter Some television sets have built-in ability to receive cable. Older sets may not be able to receive all the channels without the use of a converter. Also, a converter box is needed to receive most premium services and pay-per-view movies and events (where available). To use your converter, tune your television to the designated output channel (usually channel 2, 3, or 4), then select the stations you want to watch using the converter. Remote Control Adelphia offers cordless remote controls for greater convenience. Additional Outlets Do you have more than one television in your home? Connect the others to cable, too. You'll be surprised at how little it costs to get cable service around the house. Parental Control Cable offers a variety of mature programming options. A parental control feature is available which will block the video/audio of the programs you choose. For more information call your local Adelphia office. Sun Outages For a few days in the spring and fall, brief interruptions (5-10 minutes between 2 P.M. and 6 P.M.) in satellite delivered programming may occur due to an alignment between the sun, the orbiting communications satellite, and our receiving antenna. We thank you for your understanding during these brief "sun outages." Lightning During electrical storms we advise that you unplug your cable and television sets. Adelphia is not responsible for any damages to customer owned equipment caused by lightning or any other 'Act of God' beyond Adelphia's control. Effective: 12/98 Cable Entertainment & The Law Theft of Service According to the Cable Communications Policy Act of 1984, as amended by the Cable Television Consumer Protection and Competition Act of 1992, no person shall receive communi- cations service offered over a cable system unless authorized to do so. Persons found violating this law are subject to a possible fine of $100,000, or imprisonment of not more than five (5) years, or both. These penalties apply to both the supplier and receiver of such unauthorized or illegal service. Such person(s) may also be subject to a civil suit for statutory or actual damages. In addition to Federal Law, many states have also enacted legislation concerning theft of service. Your Right to Privacy The Cable Communications Policy Act of 1984, as amended by the Cable Television Consumer Protection and Competition Act of 1992, outlines your right to personal privacy as a cable customer. All cable related information pertaining to your account is on file at your local cable office and is available for your review. This file includes the following: your name, address, phone number, payment history, service options youf have ordered, maintenance and repair records, and the number of serviced television sets. This information is used for billtg, service, marketing, research, and other cable related purposes. It may be used by the company during the period of time you receive cable service and for a period of time at the conclusion of active service. The company will delete personally identifiable , information when it is no longer necessary for conducting cable related business. The cable company will not release any personal information except to those individuals or businesses to which it is` legally permitted to do so. We will not release any information `1 pertaining to you to any government agency unless it id Under compliance with a court order. In such cases, we will notify you Table of Contents Welcome 1 General Information 3 Picture Quality 4 Cable & Your VCR 5 How to Hook Up Your VCR 6 Reading Your Adelphia Bill 7 Cable Entertainment & The Law 9 This handbook is provided for general information purposes only and is not intended as a statement of all company policies and procedures. w e l c o m e Dear valued customer, Thank you for choosing Adelphia as your source for quality home entertainment. Today, cable television offers a wide variety of programming and we encourage you to famil- iarize yourself with all the service options that Adelphia provides. We are certain you will agree that your cable service delivers informative and exciting programs to fit every interest. This handbook is designed to give you valuable information about Adelphia CableEntertainment services. We hope you will save it and refer to "it -often.. For your convenience, we have organized this material into several categories with an index to direct you to specific topics. If you. have additional questions; or concerns, please give us a call or stop by your local Adelphia office. Adelphia -considers technological innovation to be a ' .:F important part of its service offerings and customer satisfaction. We are combining new technologies with a strong commitment to customer care4o bring you new products and services to meet your changing needs. Everyone at Adelphia looks forward to providing you with the highest 'ns services available. f in order to give you a chance to contest the order as you are permitted by law. Adelphia respects the rights of our customers. Keeping you informed is an important part of our continuing effort to provide you with better quality cable TV service. Complaint Resolution Procedures Adelphia places a very high priority on ensuring that our customers are satisfied with the service we provide. Toward this goal, and in order to comply with FCC law, Adelphia has designed the following procedures to.respond to any dissatisfaction you may have regarding'cable service.. Please -, .... follow these procedures to help us" address your concerns as e ;:promptly and as efficiently as possible. If you have a.omplaint regarding any aspect of your cable.., services, we encourage you to call. our Customer Service Department at the telephone number listed on your monthly bill. If you are not satisfied with the manner in which your concern has been addressed after speaking with the Customer Service Department, please submit` your complaint in writing to the General Manager of your local Adelphia office at the address listed on your monthly bill. Should you remain dissatisfied with the manner" in" which your concern has been "addressed, you "may'contact the corporate office. of Adelphia at: Adelphia Communications Corp. P.O. Box 472 Coudersport PA 16915 Attn: Customer Service At this point, you may also contact your local franchising authority. The address appears, on your monthly cable -bill. Again, we encourage you to contact us if you are -dissatisfied with any aspect of your cable services:" Adelphia looks forward to serving you with excellence. Your Guide to Adelphia Cable Entertainment depha/ Your Link For Everything Mainkat Water Street Coudersport'PA 16915 ®able Entertainment Digital Cable Channel Line -Up 101 D -KID Discovery Kids 102 D -SCI Discovery Science 103 D-HOM Discovery Home 111 GAME Game Show Network 112 EOP Eye On People 113 ROMCE Romance Classics 201 HBO HBO 202 HBO PL HBO Plus 203 HBO S HBO Signature 204 HBO F HBO Family 205 HBO W HBO West 206 HBO PW HBO Plus West 207 HBO SW HBO Signature West 208 HBO FW HBO Family West 211 MAX Cinemax 212 MMA)( More Max 215 MAX W Cinemax West 216 MMAXW More Max West 221 SHOW Showtime 222 SHOW 2 Showtime 2 223 SHOW 3 Showtime 3 224 SHOWX Showtime Extreme 231 TMC The Movie Channel 232 TMC 2 The Movie Channel 2 O O O O O O • • • • • • • • • • • • • • • • • • Adelphia 22 channels of Pie theater Adelphia Home Theater 300 AHT Adelphia Home Theater Information • 301-322 AHT Adelphia Home Theater 0 .114/1 1fe 40 channels of Music Choice e oze-e. 401 MC Hit List ❑ 402 MC Dance ❑ 403 MC Rap ❑ 404 MC R&B Hits ❑ 405 MC Body & Soul ❑ 406 MC World Beat ❑ 407 MC Blues ❑ 408 MC Jazz ❑ 409 MC Lite Jazz ❑ 410 MC New Age ❑ 411 MC Progressive Album Mix ❑ 412 MC Alternative Rock ❑ 413 MC Metal ❑ 414 MC Classic Rock ❑ 415 MC 70s Super Hits ❑ 416 MC Solid Gold Oldies C 417 MC Soft Rock ❑ 418 MC Today's Country C 419 MC Classic Country ❑ 420 MC Easy Listening ❑ 421 MC Singers & Standards ❑ 422 MC Big Band ❑ 423 MC Classical Masterpieces ❑ 424 MC Lite Classical ❑ 425 MC For Kid's Only El 426 MC Contemporary Christian ❑ 427 MC Gospel El 428 MC Musica Latina ❑ 429 MC Showcase I ❑ 430 MC Showcase II ❑ 431 MC Sounds of the Season ❑ 432 MC `80s Power Hits ❑ 433 MC Show Tunes ❑ 434 MC Tejano ❑ 435 MC Soul Classics El 436 MC Opera ❑ 437 MC Tropical ❑ 438 MC Mexicana ❑ 439 MC Rock Hits ❑ 440 MC Party Favorites ❑ Key o Variety Channel • Preium Channel QdeHph0a • Adelphia Home Theater Channel ❑ Music Choice Channel Your link. For everything. Cable Entertainment Coudersport/Emporium/Port Allegany Channel Line -Up Channel . Network „ ;;`"-:Station/Service.` <`� Key 02 NBC WGRZ 2 Buffalo ❑ 03 PBS WPSX 3 Clearfield 04 CBS WIVB 4 Buffalo 05 HBO HBO • 06 NBC WJAC 6 Johnstown ❑ 07 ABC WKBW 7 Buffalo ❑ 08 NBC WETM 18 Elmira ❑ 09 INFO Community Billboard ❑ 10 CBS WTAJ 10 Altoona ❑ 11 TVG TV Guide Channel ❑ 12 ANTI Adelphia Home Theater Information ❑ 13 FOX Fox Net ❑ 14 WB WGN 9 Chicago ❑ 15 AP Animal Planet ❑ 16 WB WPIX 11 New York ❑ 17 IND TBS 17 Atlanta ❑ 18 ESPN 24 Hour Sports 0 19 PIN Product Information Network 0 20 ESPN2 24 Hour Sports 0 21 EMPIRE Empire Sports Network 0 22 TWC The Weather Channel 0 23 CNN Cable News Network 0 24 HN Headline News 0 25 CNBC Consumer/Business News 0 26 C -SPAN House of Representatives 0 27 C-SPAN2 Senate 0 28 PCN Pennsylvania Cable Network 0 29 TRAVEL The Travel Channel 0 30 FOOD Food Network 0 a.. AMC American Movie Classics 0 TCM TNT Turner Classics Movies O USA Network 0 Turner Network Television 0 FX FX Network 0 (800) 892-7300.` www.adelphia:,rlet A•$'elphia Your Link For Everything 36 A&E Arts & Entertainment 0 37 DSC The Discovery Channel 0 38 TLC The Learning Channel 0 39 HIST The History Channel 0 40 TNN The Nashville Network 0 41 CMT Country Music Television 0 42 MTV Music Television 0 43 VH1 Video Hits One 0 44 FOXFAM Fox Family Channel 0 45 NICK Nickelodeon 0 46 TOON The Cartoon Network 0 47 HSN Home Shopping Network 0 48 QVC Quality, Value, Convenience 0 49 FSP Fox Sports Pittsburgh 0 50 EWTN Eternal World Television Network 0 51 TBN Trinity Broadcasting Network 0 52 ODSY Odyssey 0 53 INSP The Inspirational Network 0 54 DISNEY Disney Channel 0 55 HBOPL HBO Plus • 56 HBOSG HBO Signature • 57 SHOW Showtime • 58 TMC The Movie Channel • 59 MAX Cinemax • 60 MSNBC All News Network 0 61 AHT Adelphia Home Theater • 62 SCI-FI Sci-Fi 0 63 TVLAND TV Land 0 64 KNOW Knowledge Television 0 65 LIFE Lifetime Television 0 66 HGTV Home & Garden TV Network 0 70 UNIV Univision (Spanish Programming) 0 Key D Broadcast Channel 0 Satellite Channel • Premium Channel • Adelphia Home Theater Channel Effective Date 8/99 Adelphia Your Link For Everything ;71:S11. e Wekome to Ade/phis "I know no way of judging the future but by the past." - Patrick Henry For over forty-five years, John Rigas and the Adelphia family have built a reputation for delivering the best in cable entertainment to thousands of homes just like yours. But the future is here, and the cable business is undergoing an amazing transformation. It's growing, CHANGING, evolving...and y Adelphia is leading the way. John Rigas We continue to upgrade our cable systems Chofrman and Founder of Adelphia with state-of-the-art, fiber optic technology. This investment allows us to give you more channels, enhanced picture quality, improved service and greater reliability. New technologies also make it possible to create some amazing new products and services, all of which you can read about on the following pages. Why are we investing so much in the future? It's simple — to serve you better. Prepare to be amazed. • =i: 111n., 's • I 4 , l �^ rya 01111'1 Ititt:1\ Aks Tszt 1 ,�//�, 11;1- -;l . , / ( g .. f �llfll�i�i��� 1 -:o L> (7'l./4 1 /11/ll/I1' ` % ' . A - . . ri/ / SP' 1 '' 1 - ' :::. t deiph1e It's not magic. It's Digital. 1,11,411! at Adelphia Digital Cable uses the latest digital compression and fiber optic technology to bring more channels through the cable into your TV — ACTUALLY ANY TV. You get more programming choices, even more great movies, lots of cool music and digital quality picture and sound — it's a package that just can't be beat! Let's say you want to watch a new release movie. With Digital Cable, simply flip to one of our many Home Theater showings or expanded premium movie channels. There are hundreds of movies to choose from each month. With so many choices, you'll never have to leave the house to rent another movie. Now that's some serious TV. Find what you're looking for quickly and easily with the on-screen interactive program guide. ih - NAVIGATQR�° ADEI.PHIA SHOWCASE PPV By Time CBi Channel) PPV By Title Movres' Special Events (Sports Premiums =BliildireiTM Music Choice, �Search� o� VIEWER SERVICES Messages Favorites r Parent ConlroL Setup To press 4 .. I. To select press CD More channels. More movies More choices. t Call today and discover why Adelphia Digital Cable is your link to the future. For more info call toll-free 1-877-772-2533 !abIe Entertainment "It is no use saying, 'We are doing our best' you have to succeed in doing what is necessary." - Winston Churchill a ;Pa 1 trrllll'Y' What was once a luxury is now a necessity. :114. That's why we bring you a wide variety of affordable cable packages loaded with all the best programming and movies. No matter what interests you, you can always find what you're looking for on one of our great cable networks. News, sports, e d u c a t i o n, adventure, MUSIC and family entertainment — you name it, we've got it. with Adelphia Cable Entertainment you not only get a variety of PREMIUM CHANNELS like HBO, Showtime and Cinemax, but other benefits like inexpensive cable for all your televisions and a special Adelphia version of TV Guide. It's all part of our goal to give you the total entertainment package. Watch us. The best value in home entertainment tII�IIINiIILI(fl�l�ll�l Call today and discover why Adelphia is your link to entertainment. For more info call toll-free 1-877-772-2533 Power Link "Want to make your computer go really fast? Throw it out a window" - Anonymous r < It's not your computer's fault. It's your connection. Spare your PC, your wallet and your back and try our high-speed Internet Access. It's called Power Link, and it's the fastest way to surf the Net. Power Link is connected to your computer through your cable line. The information flows through it faster than a traditional phone line — A LOT FASTER. What does this mean for you? PowerLink gives you the freedom to live your life, instead of being chained to your computer. So stop wasting time with the world wide wait. Get Power Link. For the casual web surfer, there's also our traditional dial-up Internet Access. It's your link to the Net. We offer free unlimited usage for one low monthly fee and the ,�r•: ability to get on-line with a few simple clicks. For your convenience, fillllif .�f�f// your charges appear on your monthly Adelphia bill. Get the local service and toll-free customer support you deserve from ADELPHIA, A COMPANY YOU KNOW YOU CAN TRUST. Call today and discover why Adelphia is your link to the Internet! For more info call toll-free 1-888-233-5638 Long Distance "What we've got here is a failure to communicate." - Cool Hand Luke, screenplay, 1961 Selecting a long distance company can be confusing, but we make it simple and easy, anytime of the day or night — Adelphia Long Distance. You get up -front, simple pricing— a minute - 24 hours a day, 7 days a week for all state -to -state calls. You get 6 second billing (Instead of rounding up to the next minute and charging you for time you're not on the phone.). You don't have to dial 14 numbers to get through. And if that's not enough, we also offer highly competitive pricing on International calls, convenient calling cards and your own personal 800 numbers. Sound too good to be true? Call us on it. 9 cents a minute. All the time. Call today and discover why Adelphia Long Distance is your link to the world. For more info call toll-free 1-888-374-8444 Pagerme "Everything that is really great and inspiring is created by the individual who can labor in freedom." - Albert Einstein ,a Looking for a little more freedom and a lot more peace of mind? Try PageTime from Adelphia, our personal paging service. Like all Adelphia services, you can expect to get the very best in quality and service. Our monthly service rates are among the most competitive you'll find anywhere. We have no hidden fees or contractual agreements. We'll even give you 2 months of FREE VOICE MAIL. with PageTime, you get extended service hours, a helpful customer support network, and your choice of delivery options. Have your new pager delivered straight to your home, or stop by one of our convenient neighborhood offices. Adelphia PageTime sells only quality M MOTOROLA pagers. Choose from a wide variety of pager styles and service options. Multiple pager discounts are also available. Call today and discover why PageTime is your best value. For more info call toll-free 1-800-870-2220 Your Link to the Future I "I look to the future because that's where I'm going to spend the rest of my life." - George Burns Your Link For Everything To learn even more about the products and services featured in this brochure, visit Adelphia on the Internet at: www.adelphia.com Pretty amazing, huh? As you can see, Adelphia considers technological innovation to be an integral part of our service offerings, without ever losing sight of our primary goal - complete customer satisfaction. A prime example of this commitment is our on-time guarantee. GUARANTEED CUSTOMER SERVICE If we're late for an installation appointment, it's FREE. If we're late for a service call, you receive a $20 credit. We also have 24 hours a day, 7 days a week, friendly customer support. Remember, you always come first. We at Adelphia look forward to being your link to the highest quality entertainment and communications services available today and tomorrow. After all, the best way to predict the future is to create it. � ids& our website: Adelphia Your Link For Everything Main at Water Street Coudersport, PA 16915 Adelphia Your Link For Everything Customer Care Policies & Practices Manual Vermont, Massachusetts and Eastern New York MEASUREMENT: The CUSTOMER CARE Standards Quality measurement is the evaluation of customer satisfaction and company productivity. It is the measurement of processes, performance, products, and service. Measurement may be thought of as "keeping score." Through measurement, we know when we are successful in improving a process, product or service. In determining which operational performance measurements were critical to achieving the Customer Care objective, the following set of criteria were developed: The standards should be quantifiable. The standards should reflect the most important attributes of service as viewed from the customer's perspective. Realization of the standards would result in positive feedback from customers. Along these lines 6 categories have been developed: 1. Completed Daily Work 2. Installation 3. Service Repair 4. Telephone Accommodation 5. Technical: Reception Quality/Reliability 6. Added Value: Courtesy & Product Knowledge While Front Counter service is extremely important, no specific standards have yet been established. 5/21799- - 5 Customer Care Policies & Practices Manual Vermont, Massachusetts and Eastern New York CUSTOMER CARE STANDARDS COMPLETED DAILY WORK: >= 90% of all jobs are completed on the day scheduled >= 90% favorable subscriber rating on scheduling convenience >= 90% favorable subscriber rating on on-time appointments INSTALLATION: >= 50% of installations are completed w/i 3 days of order <= 3 day backlog (worst day of the month) <= 5% of installations will have service calls w/i 60 days SERVICE: >= 65% of service calls are completed same day (24 hrs) >= 90% of service calls are completed w/i 2 days (48 hrs) <= 25% annual service call rate (2.08% monthly avg.) <= 5% of service calls w/i 90 days will be repeat service calls TELEPHONE ACCOMMODATION: <= 20" avg. speed of answer and/or => 90% all calls answered w/i 30" <= 5% of all callers will abandon <= 2% all trunks busy CSSRs will not transfer callers to another department TECHNICAL: No picture will receive a subjective picture rating of 1 (inferior) or 2 (marginal) 100% of system test points will have an avg. subjective picture rating of 3.5 (passable to fine) or better Overall system rating of "A" on the MOM report System reliability threshold of 99.95% or higher >= 90% favorable subscriber rating on picture quality >= 90% favorable subscriber rating on picture reliability Minimum plant performance standards (C/N, CLI, etc.) ADDED VALUE: >= 95% favorable subscriber courtesy rating in all departments >= 95% product knowledge rating in all departments 5/21/99 - 6 I PARCEL ¢,z72 SO. FT. PARCEL VAP \0. 25093 IN THE CITY OF HERMOSA BEACH COUNTY OF LOS ANGELES STATE OF CALIFORNIA BEING A SUBDIVISION OF LOT 2, HISS' ADDITION TO HERMOSA BEACH AS PER MAP RECORDED IN BOOK 4 PAGE 19 OF MAPS, IN THE OFFICE OF THE COUNTY RE..;ORDER OF SAID COUNTY. FOR CONDOMINIUM PURPOSES SUBDIVIDER'S STATEMENT I HEREBY STATE THAT I AM THE SUBDIVIDER OF THE LANDS INCLUDED WITHIN THE SUBDIVISION SHOWN ON THIS -MAP WITHIN THE DISTINCTIVE BORDER LINES, AND I CONSENT TO THE PREPARATION AND FILING OF SAID MAP AND SUBDIVISION. MIKE MULLII,Itif SUBDIVIDER RECORD OWNER: cILZ J Ca., ItJC., A CALIfa-KIIA CGA{bva(IoKI THIS SUBDIVISION IS APPROVED AS A CONDOMINIUM PROJECT FOR 2 UNITS WHEREBY THE OWNERS OF THE UNITS OF AIR SPACE WILL HOLD AN UNDIVIDED INTEREST IN THE COMMON AREAS WHICH WILL, IN TURN, PROVIDE THE NECESSARY ACCESS AND UTILITY EASEMENTS FOR THE UNITS. STATE OF CALIFORNIA ) S.S. COUNTY OF LOS ANGELES ) ON__kms �`� Vitt 19 BEFORE AP PEA ED �- -- �ktG Mt 1:2c-totliAl. tr, PERSONALLY No. 11284 EXP. 12-31-00 m ENGINEER'S STATEMENT SHEET I OF 2 SHEETS RECEIVED SEP 2 3 1999 CAM. DEV. DEPT. THIS MAP WAS PREPARED BY ME OR UNDER MY DIRECTION AND WAS COMPILED FROM RECORD DATA IN CONFORMANCE WITH THE REQUIREMENTS OF THE SUBDIVISION MAP ACT AND LOCAL ORDINANCE AT THE REQUEST OF t'nKe NULLi4aN aJ 11-4-97 I HEREBY STATE THAT THIS PARCEL MAP SUBSTANTIALLY CONFORMS TO THE APPROVED OR CONDITIONALLY APPROVED TENTATIVE MAP, IF ANY. PERSONALLY KNOWN TO ME OR PROVED TO ME ON'THE BASIS OF SATISFACTORY EVIDENCE TO BE THE PERSON WHOSE NAME IS SUBSCRIBED TO THE WITHIN INSTRUMENT AND ACKNOWLEDGED TO ME THAT HE EXECUTED THE SAME IN HIS AUTHORIZED CAPACITY AND THAT BY HIS SIGNATURE ON THE INSTRUMENT THE PERSON OR THE ENTITY UPON BEHALF OF WHICH THE PERSON ACTED, EXECUTED THE INSTRUMENT. uC. NAME: a/\-( - • /l(A'v�' €ICA - — MY PRI IPAL PLACE OF BUSINESS IS LOS ANGELES COUNT' COMMISSION EXPIRES 'i' c")•11 NOTARY PUBLIC IN AND FOR SAID STATE z , ...._.50,3 :... EASEMENT OF WARREN GILLELEN, FOR WATER PIPELINES AND INCIDENTAL PURPOSES, PER DEED RECORDED JUNE 27, 1902 IN BOOK 1617, PAGE 47 THROUGH 50, INCLUSIVE, OF DEEDS.SAID EASEMENT IS BLANKET IN NATURE. ...,�^ ,..:., r. 054-/57 (4/23 —2) EDWARD G. SHWEIRI R.C.E. 11284 EXPIRATION: 12-31-00 RECORD DATA WAS TAKEN FROM HISS' ADDITION TO HERMOSA BEACH M.B. 4-19 SPECIAL ASSESSMENTS CERTIFICATE I HEREBY CERTIFY THAT ALL SPECIAL ASSESSMENTS LEVIED UNDER THE JURISDICTION OF THE CITY OF HERMOSA BEACH, TO WHICH THE LAND INCLUDED IN THE WITHIN SUBDIVISION OR ANY PART THEREOF IS SUBJECT, AND WHICH MAY BE PAID IN FULL, HAVE BEEN PAID IN FULL. CITY TREASURER OF THE CITY OF HERMOSA BEACH DATE CITY ENGINEER'S CERTIFICATE I HEREBY CERTIFY THAT I HAVE EXAMINED THIS MAP AND THAT IT CONFORMS SUBSTANTIALLY TO THE TENTATIVE MAP AND ALL APPROVED ALTERATIONS THEREOF; THAT ALL PROVISIONS OF SUBDIVISION ORDINANCES OF THE CITY OF HERMOSA BEACH APPLICABLE AT THE TIME OF APPROVAL OF THE TENTATIVE MAP HAVE BEEN COMPLIED WITH; AND THAT I AM SATISFIED THAT THIS MAP IS TECHNICALLY CORRECT WITH RESPECT TO CITY RECORDS. HARRY W. STONE CITY ENGINEER DEPUTY R.C.E. / 8 7G S COUNTY ENGINEER'S CERTIFICATE Z-20.29 DATE I HEREBY CERTIFY THAT I HAVE EXAMINED THIS MAP, THAT IT COMPLIES WITH ALL PROVISIONS OF STATE LAW APPLICABLE AT THE TIME OF APPROVAL OF THE TENTATIVE MAP; AND THAT I AM SATISFIED THAT THIS MAP IS TECHNICALLY CORRECT IN ALL RESPECTS NOT CERTIFIED TO BY THE CITY ENGINEER. COUNTY ENGINEER BY DEPUTY DATE RCE NO. EXPIRES CITY CLERK'S CERTIFICATE I HEREBY CERTIFY THAT THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH BY MOTION ADOPTED AT ITS SESSION ON THE DAY OF , 19__ APPROVED THE ANNEXED MAP. CITY CLERK OF THE CITY OF HERMOSA BEACH DATE CITY PLANNER'S CERTIFICATE I HEREBY CERTIFY THAT THE ANNEXED MAP CONFORMS SUBSTANTIALLY TO THE TENTATIVE MAP APPROVED BY THE PLANNING COMMISSION ON THE DAY OF , 199_ SECRETARY OF PLANNING CITY OF HERMOSA BEACH DATE a 00 cO O N N Z a N'LY LINE OF LOT 3-. SCALE: I" =20' SHEET 2 OF 2 SHEETS PARCEL VAP \0, 25093 IN THE CITY OF HERMOSA BEACH COUNTY OF LOS ANGELES STATE OF CALIFORNIA FOR CONDOMINIUM PURPOSES '-x HISS' ADDITION TO HERMOSA BEACH M.B. 4-19 FD SPK NO REF ACCEPTED AS INTERSECTION OF SW'L'( PROLONGATION OF WO" LINE LOT I AND E LOMA DR. UJ 0 Q O J 17.5' N 22°06'00"W 17.5' 0 0 O O 0 N N 17.5' s e e INDICATES THE BOUNDARY OF THE LAND BEING SUBDIVIDED BY THIS MAP N 67°54'00"E SLY LINE OF LOT I 100.00' • • • • AREA = 4,000 SO FT • • • • N 67°54'00"E 100.00' 16TH STREET12. FD PK NAIL NO REF. ACCEPTED AS INTERSECTION OFtW`LYPROLONGATION OF g'L'( Lit4 LOT 513 ¢ OF LOMA DR. a IAI'LY LINE OF LOT 40**