2022 08 24 FAC Minutes Special MeetingFINANCIAL ADVISORY COMMISSION
SPECIAL MEETING
MINUTES
WEDNESDAY, AUGUST 24, 2022
CALL TO ORDER
A special meeting of the La Quinta Financial Advisory Commission (Commission)
was called to order at 4:00 p.m. by Chair Batavick.
This meeting provided teleconferencing accessibility pursuant to Executive Orders
N-60-20 and N-08-21 executed by the Governor of California, and subsequently
Assembly Bill 361 (AB 361, 2021), enacted in response to the state of emergency
relating to novel coronavirus disease 2019 (COVID-19) and enabling
teleconferencing accommodations by suspending or waiving specified provisions in
the Ralph M. Brown Act (Government Code § 54950 et seq.), and City Council
Resolution No. 2021-035, adopted by the City Council on September 28, 2021, and
reaffirmed on August 2, 2022, members of the public, the Financial Advisory
Commission, the City Manager, City Attorney, City Staff, and City Consultants may
participate in this special meeting by teleconference only.
PRESENT: Commissioners Anderson, Dorsey, Luettjohann, Mast, Mills, Way and
Chair Batavick
ABSENT: None
STAFF PRESENT: Finance Director Martinez, Financial Services Analyst Hallick,
Account Technician Batuta, and Deputy City Clerk McGinley
PLEDGE OF ALLEGIANCE
Commissioner Dorsey led the audience in the Pledge of Allegiance.
The Commission and staff shared a brief introduction of their background and
experiences.
PUBLIC COMMENT ON MATTERS NOT ON THE AGENDA - None
CONFIRMATION OF AGENDA
Staff requested that Business Session Item No. 3 "Receive and File the Annual
Comprehensive Financial Report for the year ended June 30, 2021" be moved up
and considered first on the agenda. The Commission concurred.
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SPECIAL MEETING
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BUSINESS SESSION - taken out of Agenda order
3. RECEIVE AND FILE THE ANNUAL COMPREHENSIVE FINANCIAL
REPORT (ACFR) FOR THE YEAR ENDED JUNE 30, 2021
Finance Director Martinez and CPA Partner Phillip White with Eide Bailly, LLC
auditing firm (EB) presented the staff report, which is on file in the Finance
Department.
Mr. White explained EB's audit purview and scope, and sections related to the
independent auditor report, found on page 1, of the ACFR.
The Commission, staff, and Mr. White discussed steps taken to strengthen internal
controls; details of the City's internal controls over financial reporting that was
identified for accounting entry adjustments referenced on page 1 in the ACFR
summary (Attachment 1); and the three levels of internal control deficiencies.
Further discussion followed regarding footnote 17 on pages 67-72 of the ACFR,
referencing Long -Term Debt and debt related to the former Redevelopment Agency
(RDA) of the City and Successor Agency debt noted in ACFR that is not a direct
obligation for the City.
Commissioner Mills suggested adding more detail to footnotes on long-term debt
related to RDA for a better understanding. Staff and Mr. White mention that a brief
history can be found in footnote 17 on page 67 of the ACFR, but can look at ways
to improve clarity. Commissioner Way inquired on a meeting with staff to review
the ACFR for a better understanding. Finance Director Martinez confirmed
coordinating a review in the future.
Motion - A motion was made and seconded by Commissioners Dorsey/Way to
receive and file the Annual Comprehensive Financial Report for the year ended
June 30, 2021, as submitted. Motion passed unanimously.
ANNOUNCEMENTS, PRESENTATIONS, AND WRITTEN COMMUNICATIONS
None > > > taken out of Agenda order
CONSENT CALENDAR ITEMS
1. APPROVE MEETING MINUTES DATED JUNE 1, 2022
2. RECEIVE AND FILE REVENUE AND EXPENDITURE REPORT DATED
APRIL 30, 2022
3. RECEIVE AND FILE REVENUE AND EXPENDITURE REPORT DATED
MAY 31, 2022
4. RECEIVE AND FILE FOURTH QUARTER FISCAL YEAR 2021/22
TREASURY REPORTS FOR APRIL, MAY, AND JUNE 2022
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Chair Bativick inquired about the non -general fund revenue listed under top five
revenue/income sources for May on page 2 of the staff report for Consent Calendar
Item No. 3. Financial Services Analyst Hallick explained the larger amount of
$12,931,361 is pertaining to the debt service payment mentioned in the discussion
regarding the ACFR.
Commissioner Mills noted he was not able to review the ACFR as he was out of
town and would not be able to vote on this item.
Motion - A motion was made and seconded by Commissioners Anderson/Way to
approve the Consent Calendar, as submitted. Motion passed: ayes - 6, noes - 0,
abstain - 1 (Mills).
BUSINESS SESSION - Continued
1. APPOINT A FINANCIAL ADVISORY COMMISSIONER CHAIRPERSON
AND VICE -CHAIRPERSON FOR FISCAL YEAR 2022/23
Finance Director Martinez and Financial Services Analyst Hallick presented the staff
report, which is on file in the Finance Department.
Commissioners Mills and Dorsey expressed their interest to serve on the
Commission as Chairperson and Vice -Chairperson for fiscal year 2022/23.
Motion - A motion was made and seconded by Commissioners Way/Anderson to
appoint Commissioners Mills and Dorsey as Chairperson and Vice -Chairperson,
respectively, for fiscal year 2022/23. Motion passed unanimously.
2. APPOINT TWO FINANCIAL ADVISORY COMMISSIONERS TO
REVIEW THE CITY'S OUTSTANDING PENSION OBLIGATION
Financial Services Analyst Hallick presented the staff report, which is on file in the
Finance Department.
The Commission and staff discussed timeline and review process for the City's
outstanding pension obligation. Commissioners Anderson and Dorsey expressed
interest to be on the subcommittee for review of the City's pension obligation.
Motion - A motion was made and seconded by Commissioners Mills/Mast to appoint
Commissioners Anderson and Dorsey to serve on the subcommittee for review of
the City's pension obligation. Motion passed unanimously.
STUDY SESSION - None
DEPARTMENTAL REPORTS
All reports are on file in the Finance Department.
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1. FINANCE DEPARTMENT CURRENT AND FUTURE INITIATIVES
Finance Director Martinez mentioned an additional subcommittee will also be
requested for review of request for proposal (RFP) for auditing services at the
February 2023 Commission meeting. Commissioner Batavick asked if requesting
an RFP for auditing services was for best practice; Staff confirmed and noted the
RFP followed the City's established procurement process for services pursuant to
the City's adopted Purchasing Policy.
2. FIRST QUARTER 2022 (JANUARY-MARCH) SALES TAX UPDATE FOR
THE CITY OF LA QUINTA
The Commission and staff discussed sales activity growth for non -confidential
business types. Financial Services Analyst Hallick said she would reach out to the
City's consultant, HdL Coren & Cone, Inc. to see if more information on growth can
be provided and would share with the Commission. Further discussion followed
regarding sales tax revenue.
COMMISSIONERS' ITEMS
The Commission discussed Measure A, an initiative petition proposing to phase -out
and permanently ban non -hosted short-term vacation rentals (STVRs) in non-
exempt areas of the City by December 31, 2024, which qualified and will be on the
November 8, 2022 ballot. Staff said they would share with the Commission the
links to Council meetings where this item was discussed.
The Commission inquired when the City plans to do a citywide fee study. Staff
explained the City annually updates the City's Master Fee Schedule to reflect annual
Consumer Price Index (CPI) increases; and every five to seven years completes a
citywide comprehensive fee analysis to determine if fee adjustments are needed
to improve the correlation between the City's cost of providing services and the
fees imposed to recover those costs; and staff will provide additional information
on this matter to the Commission.
ADJOURNMENT
There being no further business, it was moved by Commissioners Way/Mast to
adjourn this meeting at 5:58 p.m. Motion passed unanimously
Respectfully submitted,
,> /
Jessica Delgado, Management Assistant
City of La Quinta, California
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