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71-0607_CC_Minutes_Adjourned Regular MeetingJune 7, 1971 ADJOURNED REGULAR MEETING - CITY COUNCIL - CITY OF SAN JUAN CAPISTRANO The City Council of the City of San Juan Capistrano, California, met for an adjourned regular meeting on Monday, June 7, 1971 at 7:08 PM in the Council Chambers of the City Hall. Councilmen present: Bathgate, Chermak, Gammell and Thorpe Councilmen absent: Mayor Forster Mayor Pro Tem William A. Bathgate convened the meeting at 7:08 PM and suggested Council deal with a recent request of the San Juan Capistrano Chamber of Commerce for release of budgeted funds for printing of promotional brochures. CHAMBER OF COMMERCE REQUEST FOR BROCHURE FUNDS Mrs. Pat Toner of the Chamber of Commerce was present and explained that the total cost for the brochures describing the City, as approved by the Council's Committee of Councilmen Bathgate and Chermak, would be $4,117. Mrs. Toner also stated that the printer, Cal -Graphics of Laguna Niguel, would incur an immediate expense of approximately $2,000 for which they requested advance payment. Councilman Gammell, seconded by Councilman Thorpe, moved that the City advance the $2,000 as a part of the City's budgeted expense for this item. Councilman Chermak questioned the printer's need for a 50% advance of the print- ing costs. Mrs. Toner explained that Cal -Graphics was chosen by the Chamber as the best qualified low bidder and that they would immediately assume considerable out-of-pocket expense for supplies and services from subcontractors who have to be paid. The Mayor Pro Tem called for the question of a $2,000 advance to the Chamber of Commerce for partial payment on the brochures. Carried unanimously with 4 ayes and one absent. PUBLIC WORKS PRESENTATION ON PROPOSED TREATMENT PLANT EXPANSION Mayor Pro Tem Bathgate next introduced the subject of the proposed expansion of the City's waste water treatment plant and asked the Director of Public Works for a report. Mr. T. J. Meadows informed Council that to meet certain Federal and State Grant deadlines, the City must advertise the expansion project before July 1, 1971. Mr. Meadows then asked Mr. Don Martinson of Engineering -Science to present a detailed explanation of the problem. Mr. Martinson said that the project is based upon a hoped for 80% Federal -State Grant. He said the problem that has developed is that the State has been deluged with Grant applications for this type of project and the City's application did not receive a high enough priority rating to qualify in this fiscal year. An alternative approach available to the City would be to qualify for a reimbursable grant within the City and other participating agencies would immediately finance the project and be reimbursed by the Federal and State government in fiscal year 1971-72. In order to do this, San Juan Capistrano as the requesting agency must certify that 100% of funding is available. He explained that current and proposed funds 16 from imminent bond sales will be available to allow this certification. Mr. Martinson further stated it was not clear at this moment exactly what percentage of reimbursement would be available in fiscal 1971-72, but it would be between 65% and 907o. Council was advised that it should take bids no later than July 30, 1971 and include a 60 day hold on bid award for the purpose of studying methods of financing. Mr. Martinson said the estimated cost of the treatment plant expansion is $2,300,000 with Moulten-Niguel assuming 800 of the costs, Santa Marguerita Sanitary District 10%, and San Juan Capistrano 10%. Mr. Meadows informed Council that the purpose of tonight's presentation to Council was informational only and that if Council agreed, the necessary forms and documents for Council action would be presented at the June 14th regular meeting. Mayor Pro Tem Bathgate asked if the imposition of a 60 day study period following receipt of bids would raise the contractor's bid amounts for the project. Mr. Martinson replied that this requirement was not unusual in projects of this nature and that it was not antici- pated that there would be an inflationary effect. Mr. Meadows added that according to the proposed schedule of financing, grant payments and construction completion, the City should receive all eligible grants prior to progress payments being billed by the selected con- tractor. Council then directed Mr. Meadows to present the necessary documentation for plans and specifications and bid requests on the proposed treatment plant expansion at the June 14th meeting. Council- man Chermak stated that if he were to be present at that meeting he would support such action as outlined by Mr. Meadows and Mr. Martinson. BUDGET STUDY SESSION FOR PROPOSED 1971-72 FISCAL BUDGET The Council began its first study session on the proposed 1971-72 budget by reviewing the Fund Summary pages at the beginning of the budget. Councilman Gammell asked why County Gas Tax revenues in prior budgets were deleted in the proposed budget. Staff responded that these revenues are for special projects negotiated with the County in the past and that none of this type are included in the proposed budget. Mayor Forster arrived at 7:38 PM and took his seat. Mayor Pro Tem Bathgate turned the Chair over to Mayor Forster at that time. Mayor Forster and Councilman Bathgate asked questions on the 1971- 72 projected assessed evaluation for the City. Staff replied that projected growth is based on fairly solid trends and that fluctuations in exemption amounts were the result of changes in state law. Staff asked Council to take notes of technical errors on page 3 of the budget which required the 1970-71 figure for "Other Taxes" to be changed from $133,000 to $143,000, and the category of "Licensing and Permits" to be reduced from $52,700 to $42,700. Councilman Bathgate asked for explanations on various proposed transfers to the General Fund from Special Funds listed or. page 5 of the budget. The Director -2- 41712 17 of Finance answered that General Fund often incurs expenses which really are the responsibility of Special Funds and hence the need for transfers. He used as examples the Gas Tax and Traffic Safety Funds. The Mayor asked if transfers to the General Fund from the Sanitary Sewer Fund were based on the same rational and was given an affirmative answer. Lengthy discussion ensued on the cause of an approximate $200,000 drop in General Fund surpluses from the end of fiscal 1969-70 to the beginning of fiscal 1971-72. Council and staff retraced the history of certain capital expenditures including the Public Works administration building and Four Oaks Park and satisfied themselves that the money was.accounted for. The Mayor queried staff on the purpose of the $227,000 figure listed for State Grants on page 4 of the budget. The Finance Director explained that these figures were for reimbursement of flood damage such as La Novia and Oso Creek bridges. The increase of business license taxes from $10,000 to $20,000 was questioned by Councilman Gammell, who was informed that new fee schedules used for only a portion of the current fiscal year would be in force for a full fiscal year in 1971-72. Councilman Thorpe asked for an explanation of the staff's procedures in obtaining new population certification as the city grows. The Mayor questioned a projected decrease in building permit fees and why no revenues were shown for the Parks and Recreation fund. This question generated detailed staff and Council comment with the conclusion that any fees paid by developers for park development need not necessarily be shown as a revenue but instead could be placed in some form of ear -marked fund as long as they were not precluded from being invested and earned interest to be returned to the Park Fund. The Mayor asked for a detailed accounting of expendi- tures from the Parks and Recreation Fund surplus in the prior two fiscal years. The Finance Director is presenting this report at the next budget study session. Mayor Forster reminded staff to maintain an inventory of surplus equipment and liquidate it as the opportunity arose. Considerable discussion ensued on Councilman Bathgate's comment for the rate of annexation fees which would require annexed property coming into the city to assume a portion of the City's investment in its capital plant and services. The Director of Public Works reminded Council that a complete report and set of recommendations was made on this subject some time ago, but was not enacted. Councilman Thorpe commented that it might be necessary to have provision for such annexation fees enacted by some ordinance. The Mayor then requested the City Attorney to investigate the possibility of an ordinance for annexation fees with recommendation on the basic elements of such an ordinance to be included. -3- 6//7/ Additional discussion between the Mayor and staff followed on the current theories and philosophies on the cost of living for the employees. The City Administrator said that he felt a strong case could be made for a 6% cost of living increase across the board to all employees. The Mayor asked the Administrator if this was his formal recommendation at this time. The Administrator replied that this was informational to Council only and that documentation for any request for such an increase would be brought to Council prior to budget adoption. The Mayor commented that cost of living increases versus merit increases were debatable and some times misused. He also said that there was no guarantee or contract with employees that they would receive any type of periodic raise other than scheduled merit increases. After reviewing the proposed budget for Council operations with no changes, Council then devoted the balance of its study session to various elements of the Department of Public Works budget. Function 4310 (Public Works Administration ) was reviewed with no initial changes. An approximate $25,000 decrease in this budget was explained by the removal of Engineering Services to a new Function - 4311. Councilman Gammell asked if expenses were included in this budget for the use -of the Water District's billing machinery and was told that rather than a dollar charge we trade warehousing services to the District for the use of this machinery. Council then reviewed Function 4320 (Building Maintenance) and Councilman Chermak asked for a schedule of duties and functions of the building maintenance man so that he could better understand and justify a $7,000 salary for this function. Council then studied Function 4360 (Street Maintenance) and discussed the need for a new dump truck and roller. The only changes made at this time were the request of staff when it was discovered that one too many laborers had been included in the budget following transfer of the building maintenance man's salary out of this fund. It was further explained to Council that Special Department expenses (Object #330) and Services - Professional and Technical (Object #200) were increased because of high street light energy charges and expanded street maintenance and repair programs. Council then reviewed the Sanitary Sewer budget (Function 4000). Mayor Forster asked if we_were budgeted for additional employees as the treatment plant expands. Mr. Meadows replied that plans were being formulated to turn the entire waste water treatment operation over to SERRA and that in the interim it appeared we would have sufficient qualified employees to operate the plant. A brief discussion followed on the reimbursement formulas which would be applied for compensation to the City if the plant were to be operated by SERRA. Explanations to comments followed on the need for capital outlay items in the Sanitary Sewer Budget. Mr. Meadows explained the need of the proposed skiploadep, welding and torching equipment, dies and pipe vice. He said that these -4- /7191 items were necessary as the plant expanded and grew older and these items were becoming too expensive to rent. Following review of the above categories, with no initial changes by Council other than correcting of apparent technical errors, the Council adjourned at 10:12 PM to an adjourned regular meeting at 7:30 PM, June 8, 1971, in the Public Works Conference Room. City Clerk -5-G/7/-71