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2010 06 03 CC MinutesLA QUINTA CITY COUNCIL SPECIAL MEETING MINUTES JUNE 3, 2010 An adjourned meeting of the La Quinta City Council was called to order at the hour of 3:00 p.m. by Mayor Adolph, who led the audience in the Pledge of Allegiance. PRESENT: Council Members Evans, Franklin, Henderson, Sniff, Mayor Adolph ABSENT: None PUBLIC COMMENT -None CONFIRMATION OF AGENDA -Confirmed CONSENT CALENDAR -NONE BUSINESS SESSION 1. CONSIDERATION OF FISCAL YEAR 2010-2011 PRELIMINARY BUDGET. City Manager Genovese gave a brief introduction, explanation and challenges of the budget process; and Finance Director Falconer presented an overview of the preliminary budget. In response to Council Member Henderson, Finance Director Falconer confirmed funding from the Redevelopment Agency to the Housing Authority will come from the redevelopment housing funds. Council Member Franklin referenced a note in the budget supporting documents and asked for clarification on the City's capitalization policy. Finance Director Falconer stated .the City adopted a standard capitalization policy in the amount of 55,000 per a recommendation of GASB 45 about seven years ago; and explained items under S5,000 are expensed out and not shown as assets that are then depreciated. Council Member Franklin asked for clarification on the 519,200 expenditure for Boards and Commissions on Page E-73 of the Budget. Finance Director Falconer explained the amount is for stipend payments made to the City Council 2 June 3, 2010 Special Meeting Minutes Architecture & Landscape Review Committee, Historic Preservation Commission, and the Planning Commission for attendance at their meetings. In response to further questions by Council Member Franklin, Finance Director Falconer stated unexpended Community Services Grant Funds are not carried over to the next fiscal year unless so directed by the City Council; any items staff requests to be carried over will be outlined in the final budget. In reference to .the SilverRock Resort reserve account, he explained the contract. with Landmark requires a certain amount of the revenue to be set aside each year for future capital improvements; and the reserve account is consolidated with the operating account for financial statement purposes; the bank fees under SilverRock are credit card fees and are offset against revenues received; and the Redevelopment Consultant fees listed under the Redevelopment Agency are payments made to Rosenow Spevacek Group ~RSG-, the City's Redevelopment Consultant, and sub- consultants for the proposed tasks outlined on Page 189. In response to Council Member Evans, Finance Director Falconer stated the Community Services Grant Contingency account is outlined on Attachment No. 2 and shows a remaining balance of 527,850. Council Member Henderson asked if the $27,850 was carried over if it would come from the budget surplus. City Manager Genovese stated the amount goes back into the fund balance and is not part of the projected S50,000 plus budget surplus. Mayor Adolph noted the City has always worked under the premise of a conservative budget and the amounts presented are estimates based on anticipated revenues. He questioned the. projected revenue amounts compared to last year, especially in Transient Occupancy Tax jTOT-, since the Homewood Suites is open again; and stated he feels the City will do very well. Finance. Director Falconer stated budgeting is based on the best information available, and explained last year the City budgeted for a full year of TOT revenue from Homewood Suites which closed in September; the TOT amount was adjusted at mid-year budget and now the hotel has re-opened but the net TOT received will be affected by the reimbursement agreement the City now has with the hotel. In response to Mayor Adolph, City .Manager Genovese stated staff is recommending elimination of the two vacant positions; and anticipates if additional staff is needed in the foreseeable future that it would be on a contract basis. He confirmed employee merit increases are factored into the .budget. . City Council 3 June 3, 2010 Special Meeting Minutes Mayor Adolph noted in past years the Chamber of Commerce annual contract for services was for $130,000; last year they requested $190,000 and the City gave them 5150,000; this year they are requesting 5150,000 and he asked if their costs have increased so much that the extra 520,000 is needed. Tom McDermott, Chairman of the Chamber of Commerce, stated costs for publishing The Gem remains high. He stated the Chamber provides 5600,000-5700,000 in public relations for the City and explained the extra funds are needed since their membership has decreased from businesses closing. Mayor Adolph stated he is not supportive of bailing out businesses with public tax dollars, but does support making sure the Chamber is financially stable to provide the services contained in their contractual agreement with the City. Mr. McDermott stated they reduced their deficit by approximately 70% and anticipate being 100% in the black in three months. Mayor Adolph referenced the funding requests before the Council, and stated he understands the businesses' need in requesting funds but if all the requests are approved, the City budget will be in a deficit. City Manager Genovese reviewed the four funding requests received from Coachella Valley Economic Partnership (CVEP1, Hope through Housing Foundation, Old Town Artisan Studio, and Bob Hope Classic. Mayor Adolph asked if the estimated S4 million redevelopment payment to the State has been budgeted. Finance Director Falconer explained staff has budgeted 54.8 million in the Redevelopment Project Area No. 2 debt fund account. Council Member Henderson commented on the budget being the best document for anyone to learn about the City of La Quinta, and commended Finance Director Falconer and staff for the budget report. Susan Neufeld, Director of Youth Development Services, Hope through Housing, explained the organization's programs in providing afterschool activities for low-income families; and stated the organization partners with the YMCA to administer the programs. Mrs. Simonds, Community Program Director, Family YMCA of the Desert, further explained the academic and recreation programs offered to the community. City Council 4 June 3, 2010 Special Meeting Minutes Mayor Adolph explained the City's grant program to Mrs. Neufeld and Simonds and; explained much of the funds are avyarded to several afterschool programs in the community. Council Member Henderson suggested staff work with the Police Department regarding funding for the School Resource Officer position. City. Manager. Genovese confirmed. Council Member Henderson asked if the City Council concurs with the $150,000 request from the Chamber of Commerce; and stated she hopes they will no longer need to request funding from the City in the future. Council Member Sniff conveyed. his support of the Chamber of Commerce and his disappointment of the decline in membership due to closed businesses; and stated he is in support of the funding request. The City Council concurred to approve funding to the Chamber of Commerce in the amount of 5.150,000. Council Member Henderson conveyed 'her support of the La Quinta Arts Foundation and explained additional programming has been established to bring more people into the community. Council Member Sniff agreed with Council Member Henderson's comments and conveyed his support of the funding request. Council Member Evans agreed: to approve the funding request from the La Quinta Arts Foundation as .well. The City Council concurred to approve funding to the La Quinta Arts Foundation in the amount of 5145,000. Council Member Henderson conveyed .her support of continuing- with the Grant Contingency in the amount of 5100,000. Mayor Adolph stated many organizations have been affected by the economy and the City should support them to the best of its ability. Council Member Sniff stated he would rather see the amount reduced but is willing to support the full amount of 5100,000. The City Council concurred to approve funding for the Grant Contingency fund in the amount of 5100,000. Council Member Evans asked if 540,000 of .the 570,000 for the Boys & Girls Club is allocated from the General Fund and the remainder funded by a Community Development Block Grant (CDBG-. Mayor Adolph asked if 530,000 is allocated from CDBG. Finance Director Falconer confirmed. The City Council concurred to approve funding to the Boys & Girls Club in the amount of 570,000. City Council 5 June 3, 2010 Special Meeting Minutes The City Council concurred to approve funding for the YMCA Pool Contract in the amount of $32,000. Council Member Franklin conveyed her concerns of low attendance and weak marketing of the Concours d'Elegance event in La Quinta, and suggested a lesser amount be considered; and stated this event does not have the impact the Chamber of Commerce or La Quinta Arts Foundation events do. Council Member Henderson stated there were some weather challenges during one day of the event and the evening event had to be moved indoors. Mayor Adolph stated that three car shows were held within two-months time this year. Council Member Sniff conveyed his agreement to fund a lesser amount in light of the current budget constraints; and suggested no more than $10,000 be allocated for the funding request. Council Member Evans asked if the Concours d'Elegance has allocated marketing funds in addition to the funding request of $25,000. Assistant City Manager-Development Services Evans reviewed the statistics of the event including participants and attendees; and explained the setting of the event at the Dunes Golf Course should be taken in consideration. Council Member Sniff stated the Concours d'Elegance did not meet the attendance they projected. Mayor Adolph asked if the total of 4,800 attendees includes duplicate attendance over' the course of the two days. Assistant City Manager- Development Services Evans confirmed and explained there were a total of 3,100 attendees on the day of the event which included paid and complimentary tickets. Council Member Henderson stated she does anticipate the Concours d'Elegance becoming a major event in the City of La Quinta; and asked if they are included in the marketing budget for advertising. Assistant City Manager-Development Services Evans stated staff assisted in promoting the event but has not dedicated funding to market the event. Council Member Evans corveyed her support of the Concours d'Elegance as it is an event that attracts attendees of a certain social status who generate tax dollars while in the City. City Council 6 June 3, 2010 Special Meeting Minutes Council Member Sniff stated we don't know if those that attend the event are from out of town; and stated he continues to support allocating no more. than 510,000: Council Member Franklin suggested holding the event during the 'off-season' be considered. Paul Merrigan, President of the Concours d'Elegance, explained the event was moved from Palm Springs to La Quinta; a storm occurred the day before the event outside. of the Coachella Valley which affected the number of attendance; this event was planned as a world-class event to bring in multi- million dollar vehicles; reported 50% of the attendees were from the Coachella Valley, 35% were from California outside of the Valley, 15% were from 16 other states, and 4% were from outside the United States; stated several automobile magazines featured articli:s of the event in La Quinta; and. stated the investment to promote this event and bring attendees to the City. is well worth the effort. Mayor Adolph asked if the circulation of the magazines are statewide or worldwide. Mr. Merrigan stated they are worldwide. In response to Council Member Evans, Mr. Merrigan confirmed the La Quinta Resort and Hotel .has agreed to partner with the Concours d'Elegance, and stated negotiations. will be completed momentarily. Council Member. Henderson suggested this matter remain in the budget for $10,000. The City Council concurred to approve funding to the Concours d'Elegance in the amount of 510,000. Council Member Henderson asked if the dues for the Jacqueline Cochran Regional Airport are $10,000 and the funding request for the air show is $5,000. City Manager Genovese confirmed. Council Member Franklin explained the air show is free and well-attended; and requested the City Council continue their support of the event. The City Council concurred to approve funding to the Jacqueline Cochran Regional Airport in the amount of 515,000, Council Member Henderson questioned if the $6,000 dues for the Coachella Valley Economic Partnership (CVEP) has been eliminated. Council Member Evans stated her understanding is that the 56,000 is eliminated because of the 5100,000 funding request. Mayor Adolph asked for- clarification from staff. City Manager Genovese explained CVEP's funding request is $100,000 and is no longer requesting the 56,000 dues. City Council 7 June 3, 2010 Special Meeting Minutes The City Council concurred to fund the request for the Date Festival in the amount of 55,000. Council Member Henderson asked if an additional 521,000 has been added to the surplus funds due to the City Council approving reduced amounts of the funding requests. Finance Director Falconer confirmed. Council Member Henderson suggested the City Council consider the three additional funding requests depicted in the staff report (CVEP - 5100,000, Hope through Housing- Foundation - 550,000, and Old Town Artisan Studio - 525,000, totally $175,0001. In response to Mayor Adolph, City Manager Genovese confirmed representatives from the three organizations are present and available for any questions of the City Council. Wes Aldren, Director of Operations, CVEP, explained they have requested $100,000 from each city in the Valley in lieu of the 6,000; 74,000 scholarships as a direct return to La Quinta; economic development impact to the regional cities; established the Career Path Initiative program to assist students graduate high school; and introduced Chairperson Kathleen DeRosa. Mrs. DeRosa .reported CVEP is conducting a nationwide search for an Executive Director; working with the Arts Oasis to assist with the creative and artistic component of the blueprint; and explained CVEP is in business to bring businesses and jobs in the Coachella Valley. CVEP continues to work with the Palm Springs Desert Resorts Communities Convention and Visitors Authority to market this region. Council Member Franklin asked what type of participation has CVEP had from other cities. Mrs. DeRosa explained many cities such as Indian Wells, Palm Desert, and Palm Springs have contributed $100,000, and Coachella and Desert Hot Springs have contributed 550,000. Council Member Sniff stated he remains unsold on CVEP's plan; and conveyed his uncertainty about the organization's ability to produce results if given the funds requested. In response to Council Member Evans, City Manager Genovese explained the City contributed 517,000 to CVEP for the development of the feasibility study and blueprint prior to her appointment to the City Council. Council Member Henderson conveyed her appreciation of the comments stated by Council Member Sniff; she is willing to support the organization in City Council 8 June 3, 2010 Special Meeting- Minutes the amount of 550,000 contingent upon City staff monitoring the appointment and salary of the Executive Director, as well as the .number of administrative staff hired. Mrs. DeRosa explained the management consultant will be conducting a survey and establishing salary rates according to the necessary work required of each position in accomplishing the organization's goals; and stated the intention is to establish abusiness- oriented organization along with the ability to grow with the private sector. Council Member Henderson conveyed her concern that allocated funds will be used toward scholarships. Mrs. DeRosa explained the scholarships are self-supported as they are funded by various grants. Council Member Henderson qualified her support of funding for this fiscal year contingent upon future funding requests from municipalities be decreased over the years. Council Member Evans stated the organization has been working toward the goal of being self funded; and conveyed 'her support of approving 550,000 of the funding request and review the organization's progress in six months. Mayor Adolph conveyed his .concern of the organization .enabling development of housing units on property it acquires; expressed the community's expectation of Highway. 111 remaining rural; and additionally conveyed his concern of allocating funding from the reserve account. In response to Mayor Adolph, Mrs. DeRosa explained the educational scholarships. are self-funded by grants and a number of organizations. Council Member Sniff stated this organization is requesting funding for a nonsensical plan; and hopes the City Council does not provide any significant amount of funding to CVEP. Council Member Franklin conveyed her appreciation for the hard work conducted by the organization, but opposes this program and cannot support funding when- the City is trying to balance its own budget, and is willing to review this matter in-six months. Mrs. DeRosa explained the organization of CVEP and the blueprint plan. Council Member Henderson stated part of the problem is the history of CVEP. Mrs. DeRosa reviewed the history -and explained the organization became stagnant for a period of time, which led to the feasibility study and development of the blueprint plan. City Council 9 June 3, 2010 Special Meeting Minutes Council Member Henderson stated the organization should have been given a new name as history is attached to CVEP. Mrs. DeRosa stated a name change was discussed but the consensus was to keep the name as it is currently recognized; and announced the organization is currently working with Imperial County on renewable energy. Council Member Evans understands that organizations have different visions over the course of time; this is the time to regroup and reorganize to address; and supports 550,000 fund with review in six months. Council Member Henderson conveyed her support of approving 550,000 of the funding request with a review at the time of considering the mid-year budget. Mayor Adolph stated he does not object to supporting CVEP, but he is not willing to put the budget in a deficit to provide funding at this time; and asked if staff can provide information and updates on their progression to the City Council. City Manager Genovese stated a staff member sits on the CVEP Board of Directors who can provide updates to the City Council. Mrs. DeRosa assured the Mayor and City Council that the organization is not the same as the old CVEP and offered to meet with the Council Members individually to review the organization's plan. Council Member Evans asked if 576,308 is the amount that can be utilized for funding the additional funding requests. Finance Director Falconer confirmed. Council Member Henderson stated the Hope through Housing Foundation is a phenomenal organization and conveyed her concerns of funding another educational program; and suggested they apply for funding through the Grant Contingency process. Council Member Sniff stated he is not willing to support the request from the Hope through Housing Foundation. The City Council concurred to deny the funding request from the Hope through Housing Foundation. Mayor Adolph asked if there is support to fund the request of -the Old Town Artisan Studio. Council Member- Evans stated they were recently awarded 55,000 grant from the City, contingent upon receiving their 501(c113) title this year. City Council 10 June 3, 2010 Special Meeting Minutes Council Member Sniff stated the City cannot provide funds for everyone and there is a time to just say no. Council Member Evans asked if the funding will be utilized fora specific event. Victory Grund, Old Town Artisan Studio, introduced Director Lynn Garretson. and explained the organization's vision of enhancing the established programs in providing ahands-on experience of art to low-income areas in the City; stated art programs in the schools are being eliminated; and requested support from the City Council to show the organization's stability when applying for grants in the future. Council Member Franklin asked if there is an opportunity for matched funding through grants or other sources. Mrs. Grund confirmed. Council Member Franklin conveyed her support of the program and her willingness to approve an amount less than. 525,000. The City Council agreed to provide S 10,000 toward the funding request of the Old Town Artisan Studio, contingent upon matched funding from other sources. Mayor Adolph stated staff will be provided a report upon completion of the agreement with the Bob Hope Classic. Council Member Henderson recommended an agreement be made for the funding allocated to CVEP. Mayor Adolph conveyed his support of approving 525,000 to CVEP. Council Member Henderson stated she is willing to support S25,000 if that is the concurrence of the City Council. Council Member Evans concurred with Council Member Henderson's comments. Council Member Sniff confirmed his opposition to approving any amount for the funding request. City Manager Genovese confirmed the concurrence of the City Council to approve 525,000 funding for the funding request by CVEP with an agreement; $10,000 to the Old Town Artisan Studio with an agreement of matching funds; denied the funding request from Hope through .Housing Foundation;. leaving a surplus balance of 541,308 in the final budget, contingent. upon discussions. with the Police Department regarding funding for a School Resource Officer. City Council 11 June 3, 2010 Special Meeting Minutes MOTION - It was moved by Council Members Sniff/Evans to adopt the Fiscal Year 2010-2011 Preliminary Budget, as amended. Motion carried unanimously. ADJOURNMENT There being no further business, it was moved by Council Members Franklin/Evans to adjourn. Motion carried unanimously. submitted, VERONICA~d' MONTECINO, City Clerk City of La Quinta, California