Council Special Meeting

MINUTES CITY COUNCIL SPECIAL MEETING CITY OF MONTEREY Wednesday, May 27, 2020 4:00 PM MONTEREY, CALIFORNIA Councilmembers Present: Albert, Haffa, Smith, Williamson, Roberson Absent: None City Staff City Manager, Assistant City Manager, City Attorney, Community Present: Development Director, Public Works Director, Police Chief, Finance Director, Parks and Recreation Director, Human Resources Director, Dir. of Information Resources/City Clerk, Library Director Pursuant to Section 3 of Executive Order N-29-20, issued by Governor Newsom on March 17, 2020, this meeting was conducted with telephonic/video participation only by all parties. CALL TO ORDER Mayor Roberson called the meeting to order at 4:00 p.m. PLEDGE OF ALLEGIANCE Mayor Roberson led the Pledge. STUDY SESSION 1 FY20/21 Financial Report on Structural Deficit and Coronavirus (COVID-19) Deficit on the City General Fund and Proposed Budget Reductions and Revenue Enhancements (Not a Project under CEQA Article 20, Section 15378 and under General Rule Article 5, Section 15061) Mayor Roberson gave a brief introduction, saying that the format for this meeting is a Study Session and this topic will be on the June 2 meeting for deliberation. He reviewed recent actions and asked that anyone who has ideas to increase revenue or decrease spending to submit them. City Manager Uslar explained that staff would be presenting a report for FY 20-21, including a package of solutions to the anticipated budget deficit, noting the unprecedented crisis that the City is in. He outlined the course of the presentation for this evening. Mr. Uslar reviewed the City's priorities during the pandemic and noted that most of the focus on the reductions that will be presented are operationally focused rather than additional staff cuts. Finance Director Lai presented a fiscal overview, big picture, strategies/policies, and the proposed departmental solutions. Assistant City Manager Rojansathora presented the departmental proposals for Recreation and the Library. Ms. Lai presented strategies requiring decision in the next 1-2 months, 2-3 months, and mid and long term strategies. She reviewed next steps, asking for Council and public feedback City Council Minutes May 27, 2020 today, additional strategies on June 2, with direction regarding the November 2020 Election, and final adoption of the budget on June 16. City Manager Uslar clarified that there are potential layoffs in the Fire Department. He noted that this pandemic and its effects have been a wake-up call. He said that the City must use it to get our house in order. He said that it is up to the stakeholders to help with the decisions. He said that there is simply not time to go through an iterative process, due to the current fiscal situation and upcoming deadlines. Mayor Roberson said that there are still a lot of unknowns, such as how long this will last before we are back to normal. He said that Council has to take immediate action. Councilmember Haffa asked if the staff has considered selling any City assets, and Mr. Uslar said that staff has not done that, as many of the properties are revenue generators. Mr. Haffa suggested looking at the sale of assets, looking at adjusting TOT or the Conference Center task. He said that reducing programs such as CIP and NCIP should be considered. He asked if there could be more cuts in legal and worried about the cuts in Parks and Recreation, as some programs might be self funding. He said he does not want to look at charging for basic public safety. He noted that the paramedic is a luxury. He agreed with looking at Fire Department staffing is important. He said that he does not support changing binding arbitration. He said he would not be comfortable outsourcing custodial or harbor services. Councilmember Albert thanked the staff for their work. Are we basing TOT projections for July, August, & September, and Finance Director Lai explained the process and that TOT is paid 2 months in arrers. He asked how binding arbitration reduce the budget, and Mr. Uslar explained the process, but he asked to look at what we can actually afford and possibly establish a cap, which would make it more palatable. Mr. Albert said that he would like to see a budget presented with a more of a worse case scenario and plan to reduce now rather than have to come backwith more reductions. He said that he is not really in favor of changing the Charter at this time. He said that he is not in favor of closing facilities, unless rental income is a possibility. He said that these are very tough time to make these decisions because he doubts that we will have adequate community feedback Councilmember Smith thanked staff for the information. He reminded everyone that there are sunsets on the current tax measures. He asked about the basis for the TOT estimates. Assistant Finance Director reviewed the modeling used for TOT. Mr. Smith said that TOT would be a real heavy lift and he voiced concerns about hurting tourism's recovery and that there might not be support. He said he would like to review the partnership with the CVB to have a robust marketing opportunity.He said that if the City Manager believes that we're wasting money by having offices open every day, he would consider it. He said that he would only want to do it if absolutely necessary. He said that he would be willing to look at consolidating offices. He asked if there is a study already underway to review staffing in Fire and said he would like to see more data. He voiced concerns about reducing marketing. He said that at this time of staffing reductions is not a bood time to look at changing binding arbitration, but he is willing to learn more. Councilmember Williamson thanked the staff for the detailed report and proposed solutions. He asked what happens if we lose more than the average. City Manager Uslar said that yes, staff would come back if more cuts are needed. He noted that adjustments to expenditures could be made. He asked if the charts were correct or the paragraph below, as there are discrepancies. Ms. Lai said that the chart is correct, as the numbers are ever changing. He encouraged creating another option greater than the average, but not on the highest estimate. On question 2 City Council Minutes May 27, 2020 staff clarified the estimated revenues from sales tax and the proposal reduce CIP to $500,000 solely for greenbelt fuel reduction and no NCIP. Councilmember Williamson said that while the budget should be conservative, he would like staff to plan for any increased revenues that come in above estimates. He asked to have a Finance Update in the Friday folder. He asked to add an element to the priority based strategy, and that is to add a transparency item to engage the community to provide dialogue beyond the 3-minute comment period. He voiced concerns regarding the suspension of the vehicle replacement fund. He suggested the implementation of a rental registry, a vacancy tax, labor agreement that guarantees employment with increased performance and efficiencies. He asked to avoid privatizing services and supported looking at a TOT increase. He said the MCCVB points, consolidation of staff, fee increases, reduced office hours, more self services, developer deposit, risk pool plans and public-private partnerships should be on the table. Standards of coverage is worth studying and we need to work harder to engage with the public. Mayor Roberson said that fees are more palatable because they are not taxes and people who use the service pay the fee. He said that with regard to the MCCVB, public safety and cleanliness are the key to promoting the City, so he suggested having the MCCVB contribution to go to Police. He suggested reducing Fire overtime. He asked what other cities are doing, such as Pacific Grove working with labor to get a 20% cut across the board with furloughs. He asked employees to consider what they can do to help the situation. Mayor Roberson opened public comments on the item with a two-minute limit for each caller. Lorna Moffat said that the past weekend visitors crowded Fisherman's Wharf and did not wear masks. She encouraged limiting the number of people allowed on the Wharf and require masks. Neal Hurd, Monterey Firefighters Association, said that binding arbitration has never been used and has not cost the City a penny. He noted that the Fire Department has already consolidated with other cities and reduced costs and any further cuts risks citizens' safety. He suggested using more of the reserve to save positions. Kevin Ellis, General Manager at Hyatt Regency, said that jobs cannot be restored until the business is restored and he supported MCCVB marketing. Mimi Hahn, Marketing Officer for the Monterey Bay Aquarium, supported maintaining marketing funding. She said that her organization has had to make difficult decisions to cut and furlough staff, but has retained funds for marketing. Dennis McCarthy, Parks & Recreation Commissioner, said that people heavily rely on the City's P&R programs and essential services and voiced concerns regarding the depth of the cuts. He asked that Council listen to the Parks & Rec staff and he hopes to give input to the Council in June. Jeff Gorman commended the Council and staff for being forward looking and he asked to tamp down the fear. Esther Malkin said that you could not tell lthat the City is still sheltering in place from this weekend. She said that there isnot enough publish outreach and she asked that the Mornings with the Manager be held in the afternoon and evening.She objected to using CIP funds for fire reduction.She said that the Old Capitol Site only adds expenses and she supported adding TOT to the ballot. Rob O'Keefe, Monterey County CVB President, said that his organization has developed a task force to encourage a speedy recovery and will need the City's support. Rick Aldinger said that he is heavily invested in the hospitality industry and many in the industry will likely offer incentives to bring back visitors. He opposed increasing TOT or reducing marketing funding kto MCCVB because those will discourage visitors from coming back. John Turner, General Manager of the Intercontinental Clement, said that raising TOT now would hamper the ability to effectively compete and reducing MCCVB funding would have a similar result. Rick Heuer, resident of Monterey, he said that the proposed Charter Amendments would be contentious and 3  City Council Minutes May 27, 2020 he opposed moving forward with them at this time. Carol Chorbajian said that recovery of room rate is important and it is important do marketing and not raise TOT. Silas Fischer, Monterey Fire Captain, opposed cuts to levels of services in the Fire Department, particularly the paramedics program, especially during a health crisis. Kayla Fossum, president of Villa Del Monte Neighborhood Association, voiced support for the balanced approach of reducing costs and increasing revenues. She said that keeping the City safe and clean is very important and we need to increase TOT in order to maintain services. Adam Rust, Firefighter, opposed changing binding arbitration because Fire employees work without the right to strike and it has never been used. Tom Rowley said that Monterey has a natural beauty and that is why people come, and we must maintain the greenbelt. He said that it is time to eliminate stipends for the City Council and Commissions. Having no further requests to speak, Mayor Roberson closed public comments. On question City Manager Uslar said that the City is not suggesting reducing greenbelt fuel reduction. Mayor Roberson talked about the "Monterey Way" and coming to consensus and disagreeing agreeably. He asked the public to help the City find the funding for programs. Councilmember Smith noted that there will be another meeting on Tuesday. Councilmember Williamson said that the Cannery Row Business District is working on plans to close the street so businesses could take advantage of social distancing, as well as downtown and he asked to consider North Fremont. He suggested allowing remote public comments as we start having in-person meetings. He said the Council has done a really good job providing direction, but little regarding enforcement of shelter in place. ADJOURNMENT Mayor Roberson thanked everyone for loving Monterey and adjourned the meeting at 6:44 p.m. Respectfully Submitted, Approved, Bonnie L. Gawf Clyde Roberson Dir. Of Information Resources/City Clerk Mayor 4