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HomeMy WebLinkAboutMinutes 1993-06-10127 MINUTES BUDGET STUDY SESSION OF THE CITY COUNCIL THURSDAY, JUNE 10, 1993 CITY COUNCIL CHAMBERS, 215 EAST BRANCH STREET ARROYO GRANDE, CALIFORNIA The City Council of the city of Arroyo Grande met for the second 1993-1994 Municipal Budget Study Session at 5:00 P.M., with Mayor Matthew Peter Gallagher, III, presiding. Present were Mayor Gallagher and Council Members Drew Brandy, Bernard Burke, Gene Moots and James Souza. Staff Members present were city Manager Chris Christiansen, City Clerk Nancy Davis, Finance Director David Bacon, Public Works Director Van Laurn, Parks and Recreation Director John Keisler, and Acting Planning Director Scott Spierling. 1, FLAG SALUTE Mayor Gallagher led the Pledge of Allegiance to our Flag. 2 INTRODUCTION Mr. Christiansen said he would like to revisit the Planning Department's section of the proposed budget. He said under Contractual Services there are $30,000 earmarked for updating the Circulation Element. He said those monies could be taken from the Traffic Circulation Fund. He said the $5,000 deleted at the last budget meeting should be put back in because it was to pay the salary of the Planning Commission minutes clerk. Council Members agreed to both changes. 3. EXPENDITURES Council Members continued review of the proposed budget beginning on Page 35 Animal Control. Following are comments by Staff and Council and changes made by the Council: a. Animal Control Council Members discussed an animal control agreement with the County for $15,000, and the possibility of the City handling some of the calls and contracting with a trapper to handle others. Staff was directed to return to the next meeting with year end statistics on the number and type of animal control calls received, and information about what calls the trapper could respond to. b. Public Works Administration/Engineering Mr. Laurn said the steel structure that houses the equipment at the Corporation Yard is not listed for repair in this budget but will have to be repaired in the near future. He said the cost will be approximately $100,000 and that will come from the Water, Sewer and General Funds. Mayor Gallagher asked Mr. Laurn to obtain an estimate as to what the General Fund allocation would be. c. Streets/Bridge Maintenance There were no changes to this section of the budget. d. Street cleaning and Lighting Mr. Christiansen said the $80,000 listed under Contractual Services should be $50,000, with the savings of $30,000. e. Automotive Shop There were no changes to this section of the budget. f. and g. Parks and Recreation Mr. Keisler said $750 of the Parks Travel and Training Account and $750 of the Recreation Travel and Training Account were allocated for car allowance that was discussed by the Council at the last budget meeting. -1 2 8 BUDGET STUDY SESSION MINUTES JUNE i0, 1993 4 REVIEW OF EA MARKED FUNDS Council Members reviewed the other General Government Funds, including the Civic Center, Sewer, Park Development, Recreation Programs and Landscape District Maintenance# the Special Revenue Funds, including the Gas Tax, Traffic Safety, Traffic Signalization, Traffic Circulation, Transportation, Construction Tax, Drainage Facility and Sewer Facility; the Enterprise Funds, including Water, Lopez and Water Facility, and the Downtown Parking Fund. There were no changes to the proposed budget in these funds. When the Council's examination of the proposed budget was complete, Mr. Christiansen said in the worst case scenario the General Fund deficit was $9001000. He said about $73,550 had been cut as a result of the budget review and action taken by Staff. He referred to his May 21, 1993, memorandum and recommended (1) a 5% Utility Users Fee, (2) increase the Bed Tax from 6% to 10%, (3) reduce employees compensation by 5% and (4) sell the City -owned five acres of land known as the Brush Poppers property. Mayor Gallagher said the meeting would be opened to anyone in the audience who wanted to speak. MRS. BARBARA ROBINSON of 1262 Manhattan, Grover Beach, suggested that the utility users tax be raised one percent in order that the City employees' pay would not have to be reduced. she asked how much the one percent would add to the taxpayers' bills. Mayor Gallagher said a five percent tax would add roughly $8 to $10 to their total bills. City employees speaking against the recommended pay cut for City employees were MIKE TRUIJILLO of 2550 Cienega, OCeano# CAROL ANDERSON of 240 Anita, Grover Beach# RANDY ROBINSON, WILLIAM FULLER of 149 Vintage, Nipomo) VAN LAURN of 400 Indian Knob Road, San Luis Obispo, and DOUG BARMAN of 271 Halcyon Road. Their contended the pay cut would create economic hardship, is inequitable compared to the smaller amount the homeowners would have to pay, there is the fear that there would have to be more pay cuts next year to balance the budget, and the employees are performing quality work and should not be penalized. DICK FRANKS of 879 Fairoaks questioned the Contractual Services budget item in each department. He said approximately 48 percent of oontractual services may be questionable expenditures and should be looked at by the Council and Staff. He said he would be willing to pay one percent more utility users tax if the City employees' salaries could remain where they are. BOB TEETERS of 692 Via vaquero said he would agree to increasing the utility users tax one percent more to leave the employees' salaries where they are. He said before the City considers reducing employee salaries it should find out what the State financial picture will be. Mayor Gallagher said City employees should understand that the recommended scenario does not show any lack of confidence or appreciation for them. He said he is proud to live in Arroyo Grande and feels the City is well served and maintained. Commenting on the budget recommendations, Council Member Moots said selling the "Brush Poppers" property and reducing the employees' salaries would be one-time things, and the City would have to repeat the process of finding more monies to balance the budget next year. He said the increase in the bed tax and the utility users tax would be permanent increases and the Council should concentrate on them. He said he would not vote for cutting employee salaries however the budget comes out. 2 129 BUDGET STUDY SESSION MINUTES JUNE 10, 1993 Council Member Burke said the so called $1 million shortfall is closer to $900,000. He said this is the worst scenario and it may not happen. He said if the State does not take the $300,000 and the Council's $74,000 cuts in the budget are considered, the City is closer to a $530,000 shortfall. He said he would be in favor of looking at that amount and making changes in the future if necessary. He said he would be in favor of a utility users tax and adding to the bed tax. He said cutting employees' pay should be the last thing to do. Council Member Brandy said he works for the State and there was a five percent cut in his salary due to budget constraints. He said the pay out did effect the morale and job performance of the other employees. He said he was not opposed to paying more for the privilege of living in Arroyo Grande. He said a seven percent utility tax may be necessary, and the City could always lower the tax rate if it is not needed or the economy changes. He said he would like to see some sinking funds established. Council Member Souza said he never believed a five percent pay cut was warranted for the employees. He said with an increase in the bed tax and a five percent utility users tax, he believed the City is still looking at about a $30,000 deficit. Ile said he would be willing to leave it up to Staff to find that, or possibly go to a six percent utility users tax. Council Member Brandy said the Council should not consider cutting anymore expenditures or services out of the budget. fie said perhaps adding just another one-half percent utility users tax would make up the deficit. He said the City needs to keep the present quality of life in Arroyo Grande. Council Member Moots said he did not see any long term budget solution without fees. He said the City has had to make cuts for three years, and now it needs to balance its budget and get on solid footing. He said the citizens may have to pay a little more to live here. Mayor Gallagher said the City has an obligation for self- sufficiency and to provide services in the most cost-efficient manner as possible. He said the City has to justify to the citizens that it can provide good stewardship of their money and allocate the.resources appropriately. He said if the Council could come up with a combination of revenue increases and budgetary savings to offset the requirement of reducing staff salaries, that would be something he would want to do. He said the City needs to have money available to fix streets, buy appropriate equipment, monies to compensate employees appropriately and to shpw that the operation of the City is being done in the most cost effective manner. He said increased taxes are going to be necessary, but the Staff should provide a breakdown of estimates of how much money the City needs to invest in sinking funds, maintenance programs, structural repair, replacement of fire safety equipment, police vehicles and personnel. Council Member Moots said he would like to know what the shortfall is realistically. Council Member Souza said he would not like to have a budget surplus. Council Member Brandy said the City needs to look at monies fqr the future for such things as sinking funds for equipment replacement and street repair. He said he would not want to raise the utility users tax next year. Mayor Gallagher said this is the public's money and the City must use it in the best interests of the citizens. U 130 BUDGET STUDY SESSION MINUTES .TUNE 101 1993 It was moved by Moots/Burke, and the motion passed unanimously to adjourn at 7:53,P.M. to the Budget Study Ses0ion at 5:00 P.M. June 17, 1993. ATTESTt