2012-12-12 BDC MinutesMINUTES OF THE REGULAR ADVISORY COMMITTEE FOR
BUSINESS DEVELOPMENT MEETING OF THE CITY OF VERNON
HELD WEDNESDAY, DECEMBER 12, 2012,
IN THE COUNCIL CHAMBER OF THE CITY HALL LOCATED
AT 4305 SANTA FE AVENUE, VERNON, CALIFORNIA
MEMBERS PRESENT: William Davis, Mark Whitworth, John
McMillan, Neil Mishurda, Stan Stosel, and
Reid Delphey
MEMBERS ABSENT: Michael McCormick, Steve Halpin, and Edward
Rendon
The meeting was called to order at 8:07 a.m. by Member Davis;
Member Whitworth led the flag salute.
Director of Community Services Kevin Wilson announced that there
were no changes to the agenda and that this was the time
allotted for public comment. He inquired whether anyone in the
audience wished to address the Committee. No one responded.
DISCUSSION ITEMS
1. Discussion on proposed water rate adjustment.
Director of Community Services and Water Kevin Wilson reported
on Vernon’s three different water sources and on the City’s
current water rights.
Wilson reported that the previous study on the water rates was
conducted in 1995. A rate design was developed as a result.
Wilson reported on the various components of the rate design,
and on the current fees.
Wilson presented the proposed rate increases. In response to
Committee Member Stosel, Wilson reported on the previous rate
increases.
In response to Committee Members Stosel and Delphey, Wilson
reported that the power plant is the main user of recycled water
and that other water users have very limited use for recycled
water.
Wilson also advised that staff is proposing a pass-through
adjustment. Notice will be provided to all Vernon customers,
Advisory Committee for Business Development Meeting Minutes
December 12, 2012
Page 2 of 3
and will be subject to a public hearing process. Wilson
explained that most of the proposed cost increases are to fund
capital improvements.
Wilson presented a comparison of Vernon’s water rates to other
local utilities.
In response to Committee Member McMillan, Wilson further
reported on the sale of the water rights.
Wilson concluded the presentation, noting the need for the rate
increases to conduct infrastructure improvement projects.
2. Update on the City’s Budget and Finances.
Assistant to the City Administrator Alex Kung advised that the
City is working on ways to address the general fund deficit.
The utility users’ tax was presented to the voters during the
September 18, 2012, election but did not pass. As a result, the
City sold a portion of its water rights as a short-term
solution. The City must still develop a long term solution to
address the deficit.
Kung reported on proposed expenditure reductions, including an
early retirement program, reduction of outside legal costs and
overtime use. Kung also reported on the proposed new revenue
streams: parcel tax, a reduced utility user tax, and business
license fee increase. Coupled with the proposed reductions,
this could stabilize the general fund.
Kung advised that several meetings have been held with Vernon
businesses and the Vernon Chamber of Commerce. The estimated
fiscal impact to various business types was presented to
illustrate the overall impact of the proposed new or increased
revenue streams.
In response to Committee Member Mishurda, Kung explained the
proposed parcel tax and advised that the Chamber understands the
need for another source of revenue, but that discussions are
still ongoing.
Members of the audience commented that utility rates have
recently increased dramatically, and that businesses are paying
more now in electric rates. Additionally, it was commented that
expenditure reductions are not equivalent to the proposed
increases to businesses.
Advisory Committee for Business Development Meeting Minutes
December 12, 2012
Page 3 of 3
Kung explained the long standing general fund deficit that needs
to be stabilized through the proposed taxes and fees.
President of the Vernon Chamber of Commerce Marisa Olguin
expressed her concern that there is not sufficient awareness of
the proposal. Additional presentations to the public are
necessary to further explain the proposal before the items are
presented to the City Council on January 8, 2013.
Olguin requested a more detailed presentation on the expenditure
reductions. Committee Member Davis instructed Kung to address
the request.
ORAL REPORTS & COMMENTS
Director of Community Services and Water Kevin Wilson proposed
the cancellation of the January 2013 Committee meeting. He
advised that at a meeting thereafter, the Committee can address
the meeting frequency. If any member of the Committee has a
request for discussion topics, requests can be submitted to him.
Committee Member Delphey advised that industrial clients need to
be informed about stormwater regulations. In response, Wilson
advised that staff can prepare a presentation on municipal and
industrial stormwater permits and its impact.
In response to Committee Member McMillan, Wilson confirmed that
the mandates are a result of the Clean Water Act.
With no further business, at 9:17 a.m., it was moved by Stosel
and seconded by Delphey to adjourn the meeting. Motion carried,
6-0.
________________________
William McCormick
Vice Chairperson
ATTEST:
_________________________
Ana Barcia
Deputy City Clerk