2014-02-18 City Council MinutesMINUTES OF THE REGULAR CITY COUNCIL MEETING OF
THE CITY OF VERNON HELD TUESDAY, FEBRUARY 18,
2014, IN THE COUNCIL CHAMBER OF THE CITY HALL
LOCATED AT 4305 SANTA FE AVENUE, VERNON,
CALIFORNIA
MEMBERS PRESENT: McCormick, Davis, Maisano, Ybarra, and
Martinez
MEMBERS ABSENT: None
The meeting was called to order at 9:00 a.m. by Mayor McCormick.
Mayor Pro Tem Davis led the flag salute.
CHANGES TO THE AGENDA
Mayor McCormick advised that the closed session item on the
agenda is to be removed and postponed to the next City Council
meeting, March 4, 2014.
PUBLIC COMMENT
Mayor McCormick announced that this was the time allotted for
public comment, and inquired whether anyone in the audience
wished to address the City Council. No one responded.
PRESENTATIONS
1. Personnel Matters - Service Pin Awards
Human Resources Director Teresa McAllister reported on Director
of Light and Power Carlos Fandino’s, Sergeant Jerry Chavez’, and
Police Officer Maria Madrigal’s years of service. Mayor
McCormick presented each with a service pin.
The Council recognized Electric Operator Justin Simpson for his
years of service as he could not attend the meeting.
2. Presentation by the Finance Director on the 2nd Quarter
fiscal year 2014 investment results and policy discussion.
Finance Director William Fox presented an overview of the City’s
financial investment and policy. Pursuant to Resolution No.
2010-87, Fox reported that the City conforms to the state’s
requirements. The City’s policy includes four key elements:
safeguarding principal, meeting liquidity needs, achieving
return on funds, and minimizing loss on investment.
Fox presented and explained the four types of investment risks
as they apply to the City of Vernon: credit risk, custodial
credit risk, concentration of credit risk, and interest rate
risk.
Fox presented an overview of the City’s investment portfolio for
fiscal years 2009-2013 and explained the limitations of
restricted investments versus unrestricted investments.
Additionally, Fox presented on the investment income for said
years. The City’s goal is to extend investments so that more
interest can be earned and the City can have funds for its
operations.
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February 18, 2014
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Fox presented on the investment derivatives, swaps. He
explained that these items are more of a liability, but can be
used as an investment instrument. For the period of July 1,
2013 to December 31, 2013 the City experienced a $5.9 million
gain from its two bond series. As the City continues to see a
gain, recommendations to terminate the bonds can be considered;
staff will continue to monitor this item.
Fox concluded by stating that top priority is ensuring that the
City’s money is safeguarded. The City must match its liquidity
to its obligations. If it has the ability, it will extend its
investments in order to maximize interest. The ongoing
monitoring of its investment portfolio minimizes the potential
for losses.
It was moved by Davis and seconded by Maisano to receive and
file the 2nd Quarter fiscal year 2014 investment results and
policy discussion presentation. Motion carried, 5-0.
3. Presentation by the Finance Director on the 2nd Quarter
fiscal year 2014 financial results and year end forecast.
Finance Director William Fox presented an overview of the City’s
fiscal year financial results through December 31, 2013. He
provided data comparing the budgeted versus actual revenues and
expenditures for both the enterprise and governmental funds. He
noted and explained the variance between the budgeted and actual
data. To explain, he advised that the $8.1 million increase in
revenue for the enterprise fund is due to an uptick in utility
usage. The variance in expenditures in the enterprise fund is
due to a delay in various capital outlay projects. The shortage
in the governmental revenue is a timing issue affected by
various components; over time, the shortage will be captured.
Fox further explained the under budget expenditures for the
governmental fund, noting timing issues as the cause.
Fox presented on the year end forecast. The enterprise
expenditures, governmental revenues, and governmental
expenditures are all expected to be under budget. The
enterprise revenues are forecasted to be above what was budgeted
due to the uptick in usage experienced thus far.
Information on the city-wide fund balance for fiscal years 2009
through 2013 was presented. The general fund currently has a
negative fund balance of approximately $24.8 million. However,
the city-wide net equity is positive. Fox advised that the City
is on the road to recovery.
Fox reported on future challenges which include the Government
Accounting Standards Board (“GASB”) requirement to recognize and
record unfunded pension liabilities beginning 2015. Although the
City is in better standing than most, the City has $45 million
in unfunded liability. Additionally, CalPERS is reviewing its
formulas which could either be beneficial or damaging to the
City.
The general fund’s structural deficit will need to be addressed
over time. Furthermore, in 2015, the City will need funds to
address capital projects for the Light and Power Department.
Fox concluded that a five year long-term financial plan is being
developed. He recognized the departments for their outstanding
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February 18, 2014
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job at controlling costs and collecting revenue. He reported
that the fee study has been completed; the consultants will be
presenting the results at an upcoming Council meeting. Fox
advised that no subsidization of costs should take place; the
City’s cost should match the service. Implementation of the fee
study will occur after City Council approval.
City Administrator praised Fox on his presentation as the
information is educating many and is an example of the City’s
continued transparency.
Councilmember Ybarra concurred with Whitworth’s statements. He
sought clarification on the increase in the enterprise fund
revenues. In response, Fox opined that it’s a sign of the
economy’s recovery. He also noted the City’s incentives for new
load and new users through discounted rates. In response to
Ybarra’s inquiry as to why the same uptick in electric use is
not carried over in the forecasted budget for the next six
months, Fox explained that staff took a conservative approach in
the forecasting.
In response to Councilmember Ybarra’s concerns with the $1
million over expenditure in Safety, Fox advised that there is an
overtime issue in the Fire Department that staff is working on
controlling. The challenge is maintaining staffing levels at
all the Fire Stations.
Independent Reform Monitor John Van de Kamp advised that he made
the recommendation for presentation such as these two years ago;
he opined that the quality of the presentation is outstanding.
He commented that interest rates are projected to increase. As
a long term goal, the bond investments should be eliminated.
Van De Kamp recommended that the presentation also be given to
the business community as they need to be invested and
knowledgeable about what the City is doing and where it is
going.
Van De Kamp encouraged the Council to look toward the future and
what the City needs to do to get there. The most significant
role that the City Council can play is future planning.
It was moved by Ybarra and seconded Maisano to receive and file
the 2nd Quarter fiscal year 2014 financial results and year end
forecast presentation. Motion carried, 5-0.
CONSENT CALENDAR
It was moved by Davis and seconded by Martinez to approve the
matters listed on the Consent Calendar as presented. Motion
carried, 5-0.
Claims Against the City (to be received and filed)
1. Claim for Damages received on February 3, 2014 from Jose
Morales in an amount in excess of $10,000. Location of
the incident is outside the City’s jurisdiction; claim
will be denied.
2. Claim for Damages received on February 10, 2014 from
Enriqueta Muñoz in an amount to be determined.
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February 18, 2014
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3. Claim for Damages received on February 10, 2014 from
Javier Muñoz in an amount to be determined.
Minutes
4. Minutes of the Regular City Council Meeting held February
4, 2014, to be received and filed.
Warrant Registers
5. Ratification of Light & Power Warrant Register No. 358 to
record voided Check No. 510528 in the amount of $1,180.00.
6. Approval of City Payroll Warrant Register No. 692,
totaling $2,695,103.45, which covers the period of
December 15, 2013, through January 11, 2014, and consists
of the following:
a. Ratification of direct deposits, checks and taxes
totaling $2,053,041.86; and
b. Checks and electronic fund transfers totaling
$635,762.92.
7. Approval of City Warrant Register No. 1394, totaling
$1,161,769.96, which covers the period of January 28,
through February 10, 2014, and consists of the following:
a. Ratification of wire transfers totaling $921,901.11;
and
b. Ratification of the issuance of early checks totaling
$116,717.23; and
c. Authorization to issue pending checks totaling
$123,151.62.
8. Approval of Light & Power Warrant Register No. 359,
totaling $4,091,087.32, which covers the period of January
28, through February 10, 2014, and consists of the
following:
a. Ratification of wire transfers totaling $3,994,975.08;
and
b. Ratification of the issuance of early checks totaling
$70,003.26; and
c. Authorization to issue pending checks totaling
$26,108.98.
9. Approval of Gas Warrant Register No. 147, totaling
$1,778,972.37, which covers the period of January 28,
through February 10, 2014, and consists of the following:
a. Ratification of wire transfers totaling $1,637,317.30;
and
b. Ratification of the issuance of early checks totaling
$84,203.68; and
c. Authorization to issue pending checks totaling
$57,451.39.
City Administration Department
10. Councilmembers’ attendance report to the Independent
Cities Association Winter Seminar from January 31 through
February 2, 2014.
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February 18, 2014
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Fire Department
11. Activity Report for the period of January 16, through
January 31, 2014, to be received and filed.
Health and Environmental Control Department
12. January 2014 Monthly Report, to be received and filed.
13. Resolution No. 2014-03 - A Resolution of the City Council
of the City of Vernon approving and authorizing the
execution of a Grant Application under the California Used
Oil Competitive Grant Program to the California Department
of Recycling Resources and Recovery (CalRecycle).
Recommendation:
(1) Find that approval of the request for authority to
apply, receive and spend grant funds port are exempt
from the California Environmental Quality Act (“CEQA”)
in accordance with Section 15061(b) (3), the general
rule that CEQA only applies to projects that may have
an effect on the environment; and
(2) Adopt a resolution authorizing staff to apply, receive
and spend grant funds under the Used Oil Competitive
Grant Program (OUC1) FY 2013-2014 with State of
California Department of Resources Recycling and
Recovery (CalRecycle).
Police Department
14. Activity Log and Statistical Summary of Arrest and
Activities for the period of January 15, through January
31, 2014, to be received and filed.
NEW BUSINESS
City Administration Department
1. Selection of Name for New Housing Project at 4675 52nd
Drive in Vernon.
Recommendation:
(1) Find that the selection of a name for the new housing
project to be developed by Meta Housing Corporation at
4675 52nd Drive in Vernon is exempt under the
California Environmental Quality Act (“CEQA”) in
accordance with CEQA Guidelines Section 15061(b)(3),
the general rule that CEQA only applies to projects
that may have an effect on the environment, because
establishing the name of a building has no
environmental effect; and
(2) Determine a name for the new housing project to be
developed by Meta Housing Corporation at 4675 52nd
Drive in Vernon.
City Administrator Mark Whitworth advised that a critical reform
item was the increase of the housing and population voter base
in Vernon. He reported on the process with META Corporation to
development additional housing units. The groundbreaking is
nearing. The City engaged the Vernon City Elementary School for
possible name suggestions for the new housing development as
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February 18, 2014
Page 6 of 12
they may benefit and possibly live in the units. The suggestion
to involve the local elementary school came from Police Chief
Daniel Calleros.
Calleros reached out to the Principal and engaged the 5th and 6th
Grade Class; their suggestions have been provided.
Whitworth advised the Council that the selection is their
discretion.
Councilmember Ybarra opined that the Vernon City School’s
involvement was a great idea, but inquired whether input from
the businesses or residences had been received and whether there
were any additional suggestions. In response, Whitworth advised
that there was no input from the businesses or residents. He
noted that Senior Strategic Policy Advisor and Director of
Communications Advisor Fred MacFarlane has reached out to
various groups and discussed the idea of incorporating the
natural Los Angeles River. He clarified that the idea is to
develop a name that does not have a negative connotation and is
appropriate. The item may be continued but staff is looking for
progress as the name will be used for branding at local upcoming
events.
Mayor McCormick liked the “Pueblo del Rio” suggestion.
Councilmember Maisano liked the “Vernon Village Apartments”
suggestion.
Mayor Pro-Tem Davis liked the “Vernon Houses” suggestion.
Councilmember Ybarra like the “Vernon Villa(s)” suggestion.
Independent Reform Monitor John Van de Kamp opined that the name
should make the housing development sound attractive, and
suggested incorporating Gardens into the name. The “Vernon
Pueblo del Rio Gardens” was suggested.
Mayor McCormick suggested circulating the various names
identified by the Councilmembers and Van de Kamp to the public.
Councilmember Ybarra further suggested that the recommendations
be posted on the City’s website for general vote.
Whitworth confirmed the Council’s instructions to staff to make
the choices identified by the Council and Van de Kamp available
on the City’s website for voting. The item will be brought back
to City Council at the next meeting for final determination.
Said instructions were moved by Davis and seconded by Ybarra.
Motion carried, 5-0.
Deputy City Attorney Scott Porter further clarified that when
brought back to the City Council, the Council can either be
bound to the results of the voting or retain final authority
over the decision. He suggested that an ad hoc Committee might
be helpful to facilitate the decision making process.
Councilmember Ybarra and Mayor McCormick volunteered to be on
the ad hoc Committee for this item. It was moved by Maisano and
seconded by Davis to select them to serve on the ad hoc
committee, with said committee to return with a recommendation.
Motion carried, 5-0.
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February 18, 2014
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Health and Environmental Control Department
2. Recommend to City Council New Appointments to Fill the
Four-Year Terms to the Sustainable Development and Energy
Efficiency Commission (“SDEEC”) Starting February 2014.
Recommendation:
(1) The City Council find that appointing individuals to
serve on the Sustainable Development and Energy
Efficiency Commission is exempt from the California
Environmental Quality Act (“CEQA”) in accordance with
Section 15061(b)(3), the general rule that CEQA only
applies to projects that may have an effect on the
environment; and
(2) The mayor select, and the City Council ratify, the
appointment of three individuals to fill the three
empty seats on the SDEEC. One individual from the
specified list should be appointed from each of the
following three categories, as those individuals meet
the ordinance’s requirements for those positions:
a. “Representative from Vernon’s business community.”
Select from Michael Gavina (incumbent), Ilene
Berman, and Steve Hanson.
b. “Labor Representative.” Select from Jaime
Villanueva (incumbent) and William Murray.
c. “Environmental Representative”. Select from David
Honda (incumbent), Ronald Greitzer, and Robert
Watzke.
Director of Health and Environmental Control Leonard Grossberg
reported that in 2012, seven members were appointed to the
Sustainable Development and Energy Efficiency Commission. Three
of the seven members were selected to serve 2-year terms.
Grossberg reported on the announcement of the three vacancies
and application process.
Mayor McCormick announced his selection to appoint the
incumbents, as this is still a fairly new Commission and their
experience could be beneficial. It was moved by Maisano and
seconded by Ybarra to ratify the Mayor’s selection of Michael
Gavina, Jaime Villanueva, and David Honda. Motion carried, 5-0.
Human Resources Department
3. Resolution No. 2014-04 - A Resolution of the City Council
of the City of Vernon denying the application for an
Industrial Disability Retirement by Steve Wiles pursuant
to Government Code Section 21156.
Recommendation:
(1) Find that denying the Industrial Disability Retirement
Application is exempt under the California
Environmental Quality Act (“CEQA”) in accordance with
Section 15061(b)(3), the general rule that CEQA only
applies to projects that may have an effect on the
environment; and
(2) Adopt the resolution denying the application for an
Industrial Disability Retirement, pursuant to
Government Code section 21156, based on insufficient
medical evidence that Mr. Wiles is substantially
incapacitated from the performance of his usual and
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February 18, 2014
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customary duties as a Police Officer for the City of
Vernon.
Director of Human Resources Teresa McAllister advised that the
item is concerning a retired employee. The City has not
received information that would support the request. The
recommendation is to deny the application.
It was moved by Martinez and seconded by Davis to approve
Resolution No. 2014-04. Motion carried, 5-0.
Light and Power Department
4. Rejection of Competitive Bids Received for Padmount
Transformers (Specification No. TR1-2013-PM), and
Authorization of a Rebid.
Recommendation:
(1) Find that the approval requested is exempt under the
California Environmental Quality Act (“CEQA”) in
accordance with Section 15061(b)(3), the general rule
that CEQA only applies to projects that may have an
effect on the environment; and
(2) Reject all bids for “Specification No. TR1-2013-PM”, a
notice inviting bids to furnish and deliver padmount
transformers to the Light & Power Department, and
authorize a rebidding on essentially the same terms
and conditions as the original bid, with fine tuning
of the specifications to, among other things, clarify
that the bid invitation excludes transformers with
amorphous cores.
The Director of Light and Power, Carlos Fandino, reported that a
notice inviting bids was issued in 2013. On December 3, 2013,
the bids were opened publicly, only two companies responded. It
is staff’s recommendation to reject the bids and fine-tune the
specification and rebid the request.
It was moved by Davis and seconded by Ybarra to approve the
rejection of competitive bids received for padmount transformers
(Specification No. TR1-2013-PM), and authorize a rebid. Motion
carried, 5-0.
OLD BUSINESS
Community Services and Water Department
1. Approval of Change Order No. 2 for Citywide Pedestrian
Countdown Head Replacement, HSIP Cycle-4 Project -
Contract No. CS-0192.
Recommendation:
(1) Find that the approval of a change order for the
Citywide Pedestrian Countdown Head Replacement, HSIP
Cycle-4 project, Contract No. CS-0192, is exempt under
the California Environmental Quality Act (“CEQA”) in
accordance with Title 14, Chapter 3, Class 1, Section
15301, minor alterations of existing public facilities
involving negligible or no expansion of use beyond
that existing at the time of the lead agency’s
determination; and
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February 18, 2014
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(2) Approve Change Order No. 2 for the Citywide Pedestrian
Countdown Head Replacement, HSIP Cycle-4 project,
Contract No. CS-0192, authorizing PTM General
Engineering Services, Inc. to perform additional work
for the added cost of $39,181.68, of which only
$4,470.67 would be funds provided by the City of
Vernon; and
(3) Direct the City Administrator to execute the change
order on behalf of the City Council.
Director of Community Services and Water Kevin Wilson advised
that during the course of the project for the replacement of the
citywide pedestrian countdown heads, it was discovered that 51
of the units are oversized by 0.5 inches. The City received
approval from the state to fund the additional work at 95% in
order to address the sizing issue; the cost to the City would be
$4,470.67.
It was moved by Maisano and seconded by Martinez to approve
Change Order No. 2 for the Citywide Pedestrian Countdown Head
Replacement, HSIP Cycle-4 Project - Contract No. CS-0192.
Motion carried, 5-0.
ORAL REPORTS
Police Chief Daniel Calleros reported on a series of truck
battery thefts that occurred on February 5, 7, and 10, 2014.
Video footage of the two suspects and vehicle was captured
during one of the incidents. With the information, Detectives
were able to locate the vehicle and arrested one of the
suspects. The suspect was cooperative and admitted to being
involved in recent battery thefts. In addition, the suspect
provided information on the location of where the batteries were
being sold. Detectives will be following-up to prevent the
purchase of stolen property.
On February 9, 2014, Utilities Employee Justin Simpson observed
and reported a copper theft from one of the City’s power poles.
Patrol officers were able to locate the suspect. Additional
power poles that had been stripped of their copper wire were
also identified. Calleros noted that similar thefts had been
reported in other jurisdictions.
Calleros reported on the installation of new speed limit signs
in the 4600 block of District Boulevard. A local business had
raised concerns about vehicle accidents in the area. The new
speed limit signs are placed along the east and west sidewalk
and are illuminated by bright LED lights. He anticipates that
the new installation will provide awareness concerning the
zone’s speed limit.
Battalion Chief Andrew Guth reported that all fire service calls
have been routine in nature since the last Council meeting.
Crews responded to a few small fires and one mutual aid call.
Training focus for the month is rope rescue; the biennial EMT
recertification continues. The planning for the Alameda
Corridor Training Exercise is underway; the exercise will take
place on March 16, 2014.
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Captain Michael Gillman reported on two vandalisms, one of which
resulted in a recent arrest. The Council had no vandalism to
report.
Director of Community Services and Water Kevin Wilson reported
on the water rate increases. A notice to customers will be
distributed by the end of the week. Wilson reported on the
changes.
Wilson announced the drought in California. Southern California
is in a better position than Northern California; however, it is
still important to conserve water. Information regarding the
drought will be posted on the City’s website.
Wilson reported on the Gateway Cities’ strategic transportation
plan which will use an intelligent traffic system to improve
freight movement. There is the potential for a pilot project in
Vernon; however, Wilson cautioned that it is all dependent on
funding availability.
Director of Light and Power Carlos Fandino reported on a power
outage on February 2, 2014, due to inclement weather. As Police
Chief Calleros noted earlier, copper wire was stripped from
multiple power poles. He commended staff for the good
observation and quick response.
Fandino reported on the impact to natural gas prices due to the
extreme weather in the east coast. He reported that gas prices
reached as high as $30 per unit. The City was able to hedge
approximately 85% of its inventory at $7 per unit. Fandino
advised that there has been an overall increase in natural gas
prices.
Fandino advised that staff is working with Exide Technologies to
rework their underground electrical system.
Director of Community Services and Water Kevin Wilson
additionally reported on a water leak at General Mills that
required replacement of a line.
Finance Director William Fox reported on the implementation of
the new business license software which is running parallel to
the old system. This is to check for errors and review
accuracy. The old system will soon be closed.
Fox recalled the recommendation made by the Vasquez and Company,
LLC (“Vasquez”) to control fraud and conduct a risks assessment
through a study. Staff has started the process and is
soliciting vendors for the task. Fox would like to implement
the recommendation prior to the end of the fiscal year.
Part of Vasquez’ recommendations was to also include a fraud
hotline. The annual cost is estimated under $1,000 per year;
prior to implementation, the item will be brought to the City
Council. This is part of the good governance reform efforts.
Fox announced the completion of the fee study, the consultants
will be presenting on the results at an upcoming meeting. The
City Council can make a determination on the implementation
thereafter.
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February 18, 2014
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Director of Health and Environmental Control Leonard Grossberg
thanked the Fire Department for its assistance in the mobile
food truck inspections. Grossberg reported on a scheduled
meeting with the Department of Toxic Substances Control
regarding the closure of the industrial side of the Thermador
site. He reported on a meeting with Air Quality Management
District regarding Rule 24.1 and its impact on Exide
Technologies’ emissions. Investigations are ongoing at Four
Star Chemical. He announced the Sustainable Development and
Energy Efficiency Commission meeting on March 19, 2014, at 3:30
p.m.
Human Resources Director Teresa McAllister reported that
contract negotiations continue with the various bargaining
units. Staff continues to review and internalize the results of
the classification and compensation study with the different
departments.
Assistant to City Administrator/Successor Agency Staff Alex Kung
reported that the Recognized Obligation Payment Schedule
(“ROPS”) for the period of July through December 2014 is due in
March. Items concerning the ROPS are still being discussed. He
announced that the next Oversight Board to the Successor Agency
meeting is on March 6, 2014, at 4:00 p.m.
City Administrator Mark Whitworth announced the commencement of
the budget preparations for the next fiscal year. Staff will be
working with Department Heads.
Whitworth advised that an ordinance will be brought forth to
address the Advisory Committee for Business Development. This
Committee has not been meeting, and meetings have been cancelled
regularly. The ordinance could potentially merge the Business
Advisory Committee with the Advisory Committee for Electric
Rates.
Whitworth announced upcoming community events including the
groundbreaking at Huntington Park for the Salt Lake Park soccer
field and the Vernon Housing Development Project. Independent
Reform Monitor John Van de Kamp is anticipated to make a
presentation on his January 31, 2014, report on the City of
Vernon during the March 4, 2014, City Council meeting.
Mayor McCormick reported on his and other Councilmembers’
attendance to the Independent Cities Association Seminar earlier
this month. One of the discussion topics was the development of
community partnerships.
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February 18, 2014
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CLOSED SESSION - REMOVED
The following item was removed from the agenda, as previously
announced during the changes to agenda at the beginning of the
City Council meeting.
1. CONFERENCE WITH REAL PROPERTY NEGOTIATORS
Property: 5119, 5201 and 5241 District Boulevard and
4601 East 52nd Drive
Agency negotiator: Alex Kung
Negotiating parties: Pacific Development
Under negotiation: Price and terms of payment
With no further business, at 10:45 a.m., Mayor McCormick
adjourned the meeting.
________________________
W. Michael McCormick
Mayor
ATTEST:
_________________________
Ana Barcia
Deputy City Clerk