20100621 Regular City Council Meeting - MinutesMINUTES OF THE REGULAR CITY COUNCIL MEETING
OF THE CITY OF VERNON HELD MONDAY, JUNE 21, 2010,
IN THE COUNCIL CHAMBER OF THE CITY HALL LOCATED
AT 4305 SANTA FE AVENUE, VERNON, CALIFORNIA
MEMBERS PRESENT: Gonzales, McCormick, Davis, Maisano, Newmire
MEMBERS ABSENT: None
The meeting was called to order at 9:00 a.m. by Mayor Gonzales.
The City Clerk advised that there were no changes to the agenda.
The City Clerk announced that this was the time allotted for
public comments.
The Mayor asked if there was anyone in the audience who wished
to address the City Council. No one responded.
PRESENTATIONS
1. Master 10851 Award for Officer Fernando Valenzuela.
This award recognizes superior efforts of officers
throughout the state in the recovery of stolen vehicles and
apprehension of vehicle thieves.
Police Chief Steve Towles introduced award sponsors Greg
Peck of the California Highway Patrol and. Rosa Salazar of
the American Automobile Association to present the award.
Greg Peck emphasized what an outstanding accomplishment
receipt of a Master 10851 Award is.
Rosa Salazar stated this was the first Master Award she had
witnessed.
PUBLIC HEARINGS
1. Consideration of amendments to the natural gas rate
schedules and rules for gas service for gas distributed and
supplied by the City of Vernon within its boundaries.
These amendments include the City's Gas Municipal Utilities
Department Schedules G-1 (Residential Gas Service), G-2
(Small Commercial Gas Service), and G-3 (Large Commercial
Gas Transportation) to increase the volumetric charges.
At 9:04 a.m., it was moved by McCormick and seconded by
Davis, to open the public hearing. Motion carried, 5-0.
Dan Bergmann, City consultant for natural gas operations
management, advised that the City's gas system has been
very successful since its inception in December 2006, and
will have 40 customers by July 1, 2010. Due to its
participation in a grant program with So Cal Gas until
2013 Farmer John is the only large user not on the system,
but an ongoing dialogue is in place with its corporate
office.
City Administrator Donal O'Callaghan advised that Farmer
John's status had come up at the budget meeting on June 16,
2010, reiterating that the company was able to use the
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June 21, 2010
City's rates to negotiate an even lower rate with So Cal
Gas, which he viewed as a positive thing overall.
Bergmann advised that on February 1, 2010, So Cal Gas
increased its wholesale rate to Vernon roughly 10% and its
rates to industrial customers approximately 30%. After
careful calculations and analyses, a 19% increase to
Vernon's transportation rates is recommended. The proposed
increase, coupled with the continual addition of one to two
customers per month, and reducing connection costs by
utilizing in-house crews, would effectively keep the Gas
Enterprise in the black.
Councilman Davis asked if any customer complaint letters
had been received. Bergmann replied no letters had been
received.
The Mayor called for questions or comments from the
audience on this matter. None were raised.
At 9:13 a.m., it was moved by McCormick and seconded by
Maisano, to close the public hearing. Motion carried, 5-0.
a. RESOLUTION NO. 2010-76 - A Resolution of the City
Council of the City of Vernon Amending Natural Gas
Rate Schedule Nos. G-1 (Residential Gas Service), G-2
(Small Commercial Gas Service) and G-3 (Large
Commercial Gas Transportation) for Gas Distributed and
Supplied By the City within its Boundaries.
It was moved by Davis and seconded by Maisano, that
Resolution No. 2010-76 be approved and adopted.
Motion carried, 5-0.
2. Consideration of the expenditure of Citizen Options for
Public Safety (COPS) Funds for fiscal year 2009-2010.
The use of these funds is for front-line municipal police
services and supplement, not supplant, current front-line
law enforcement services. These funds must be used or
encumbered by June 30, 2010.
At 9:14 a.m., it was moved by McCormick and seconded by
Maisano, to open the public hearing. Motion carried, 5-0.
Police Chief Towles advised that the Police Department has
been receiving COPS funds since 1996, and have used the
funds on canine programs, motor programs, and technology,
among other things. This year's COPS funds were used to
retain two Vernon Service Officer positions that would
otherwise have been cut as a result of staff reductions.
These positions provide services that keep officers free to
respond to calls.
The Mayor called for questions or comments from the
audience on this matter. None were raised.
At 9:15 a.m., it was moved by McCormick and seconded by
Newmire, to close the public hearing. Motion carried, 5-0.
a. RESOLUTION NO. 2010-77 - A Resolution of the City
Council of the City Of Vernon Providing for the
Appropriation of the Citizens Option for Public Safety
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(Cops) Program Funds Received for Fiscal Year 2009-
2010 for Frontline Municipal Police Services.
It was moved by Davis and seconded by Maisano, that
Resolution No. 2010-77 be approved and adopted.
Motion carried, 5-0.
CONSENT CALENDAR
Business Services & Purchasing Department
1. Approval to renew for one year beginning July 1, 2010, the
Services Agreement between the City of Vernon and
Facilities Protection Systems for maintenance relating to
clean agent/CO2 fire suppression systems, with the annual
cost increased to $2,630.00 for preventative maintenance
services, but with no change to the hourly service rates
for other services.
Community Services & Water Department
1. Approval to extend for one year beginning July 1, 2010, the
Agreement for Consulting Services (as amended) between the
City of Vernon and Melvyn Green & Associates, Inc. for
structural plan checking and special consulting services
pursuant to Section 1 of Amendment No. 3 of the Agreement,
with no change in compensation.
Health & Environment Control Department
1. May 2010 Report, to be received and filed.
Light & Power Department
1. Approval to purchase transformers from the following
vendors at the total amounts listed to satisfy the
inventory levels required to meet customer needs and
sustain continuity of service. (This is a capital
expenditure.)
a. HD Supply/Cooper Power: $214,461.87
b. One Source/Central Moloney: $144,979.80
c. Pacific Utilities: $166,444.00
Personnel Department
1. Resignations
a. Police Officer Michael Johnson, effective June 14,
2010.
Police Department
1. Activity Log and Statistical Summary of Arrest and
Activities for the period of June 1 through June 15, 2010,
to be received and filed.
Treasurer's Department
1. Approval of Payroll Warrant Register No. 648, covering the
period April 11 through May 8, 2010, totaling
$2,697,407.17, and consisting of the following:
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June 21, 2010
■ Ratification of electronic fund transfers (EFTs)
totaling $2,653,563.39;
■ Ratification of the issuance of early checks totaling
$27,745.84; and
■ Checks paid through prior General Fund Warrant
Register totaling $16,097.94.
2. Approval of the following Warrant Registers covering the
period of June 8 through June 14, 2010.
a. City Warrant Register No. 1317, totaling $686,803.94,
which consists of the following:
■ Ratification of wire transfers totaling
$291,395.42;
■ Ratification of the issuance of early checks
totaling $9,391.53; and
■ Authorization to issue pending checks totaling
$386,016.99.
b. Light & Power Warrant Register No. 282, totaling
$72,040.27, which consists of the following:
■ Ratification of wire transfers totaling
$32,253.63;
■ Ratification of the issuance of early checks
totaling $2,747.33; and
■ Authorization to issue pending checks totaling
$37,039.31.
c. Gas Warrant Register No. 70, totaling $16,973.29,
which consists of the following:
■ Ratification of the issuance of early checks
totaling $9,674.34; and
■ Authorization to issue pending checks totaling
$7,298.95.
It was moved by Davis and seconded by McCormick, that the
matters on the Consent Calendar be approved as recommended.
Motion carried, 5-0.
ORDINANCES
1. ORDINANCE NO. 1172 - An Ordinance of the City Council of
the City of Vernon Amending Sections 2.34, 2.35, 2.36, 2.37
and 2.39 of the Vernon City Code Relating to the Vernon
Public Library. (Second and Final Reading)
It was moved by Maisano and seconded by Davis, that
Ordinance No. 1172 be approved and adopted. Motion
carried, 5-0.
RESOLUTIONS
1. RESOLUTION NO. 2010-78 - A Resolution of the City Council
of the City of Vernon Approving and Accepting the Grant
Deed Dedicating In Fee a Portion of the Property Located at
2001 57th Street and 2200 55th Street.
It was moved by Newmire and seconded by Maisano, that
Resolution No. 2010-78 be approved and adopted. Motion
carried, 5-0.
2. RESOLUTION NO. 2010-79 - A Resolution of the City Council
of the City of Vernon Approving and Authorizing the
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Execution of an Agreement for the Exclusive Purchase of
Goods and Related Services with Microtech Pro, Inc. for the
Purchase of Laser Toner Cartridges and Repair of Printers
and Facsimile Machines.
It was moved by McCormick and seconded by Davis, that
Resolution No. 2010-79 be approved and adopted. Motion
carried, 5-0.
3. RESOLUTION NO. 2010-80 - A Resolution of the City Council
of the City of Vernon Approving and Authorizing the
Purchase of a Public Employee Crime Policy from National
Union Fire Insurance Company through Arthur J. Gallagher &
Co.
It was moved by Maisano and seconded by McCormick, that
Resolution No.-2.010-80 be approved and adopted. Motion
carried, 5-0.
4. RESOLUTION NO. 2010-81 - A Resolution of the City Council
of the City of Vernon Approving and Authorizing the
Purchase of Property Insurance, Excess Liability Insurance
and Excess Workers' Compensation Insurance from Various
Insurers through Arthur J. Gallagher & Co.
It was moved by McCormick and seconded by Newmire, that
Resolution No. 2010-81 be approved and adopted. Motion
carried, 5-0.
5. RESOLUTION NO. 2010-82 - A Resolution of the City Council
of the City of Vernon Approving and Authorizing the
Execution of an Application for the 2010/2011 Used Oil
Payment Program.
It was moved by Davis and seconded by McCormick, that
Resolution No. 2010-82 be approved and adopted. Motion
carried, 5-0.
6. RESOLUTION NO. 2010-83 - A Resolution of the City Council
of the City of Vernon Approving and Authorizing the
Execution of a Cooperative Agreement By and Between the
City of Vernon and the Gateway Cities Council of
Governments for Phase II of the Truck Impacted Intersection
Project Contract No. CS-0020 (6/16/10).
It was moved by Davis and seconded by Maisano, that
Resolution No. 2010-83 be approved and adopted. Motion
carried, 5-0.
7. RESOLUTION NO. 2010-84 - A Resolution of the City Council
of the City of Vernon Approving a Form of Agreement for
Defense and Indemnification of Employees.
It was moved by Maisano and seconded by McCormick, that
Resolution No. 2010-84 be approved and adopted. Motion
carried, 5-0.
NEW BUSINESS
1. Request from the Light & Power Department for authorization
to expend resources to take a team to New York to meet with
Barclay's Bank and to otherwise explore restructuring of
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June 21, 2010
more than $400 million of the City's light and power
enterprise debt in order to reduce the City's annual debt
service.
Eric Fresch, Legal Financial Services Consultant for the
City's Light & Power and Gas Departments, advised that the
goal of the proposed restructuring efforts, referred to as
Project Volt, is to obtain enough proceeds to pay off bond
debt and outstanding swap contracts, including the 2008
bonds for $43 million, 2009 bonds for $419 million, roughly
$23 million in swaps, and provide some extra money to
pursue capital projects. The move is toward infrastructure
funds and private equity funds, whereby the City would be
structuring a transaction with a joint venture partner,
rather than borrowing or issuing bonds. Paying off debt
will result in an increase to the City's financial rating.
Fresch advised that the team would consist of four people
at this early stage: himself, City Administrator
O'Callaghan, an attorney from Latham & Watkins, and a
financial advisor from Bond Logistix. The team will be
pursuing the equity markets, not the debt markets, seeking
to trade debt dollars for equity dollars, and will be
looking toward a long-term transaction, as that would be
best for the City, including the procurement of enough
funds for a capital project that would help the City's
electric system increase its revenues.
Fresch clarified that he was merely seeking authorization
to pursue Project Volt as a possibility, and would seek
additional approval/authorization before any actions are
taken.
The Mayor stated that Project Volt sounded like a good idea
and something to look forward to, acknowledging that prior
electric system financial transactions undertaken by Fresch
have been very successful. He recommended Fresch be in
charge of Project Volt.
It was moved by Gonzales and seconded by McCormick, to
authorize the expenditure of resources for a City team to
go to New York to explore debt restructuring opportunities,
and for Fresch to be in charge of Project Volt. Motion
carried, 5-0.
DISCUSSIONS
1. Community Services & Water Department: Possible adjustment
to the special parcel tax rate.
Director of Community Services & Water Kevin Wilson advised
that the Special Parcel Tax was established in 1998 at
$0.01 per square foot and increased to $0.20 in 1999, where
it remained through 2007. In 2008, upon meetings with the
Chamber of Commerce and property and business owners, it
was determined that the best method to meet the Consumer
Price Index (CPI) maximum rate of $00.27331, would be to
increase the tax by $0.02 per year for three to four years.
This was done the past two years, bringing the current
Special Parcel Tax rate to $0.24.
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Given the current state of the economy, Wilson felt it
prudent to revisit possible adjustments to the Special
Parcel Tax and presented the following options to the City
Council: (1) continue the $0.02 increase for the next two
years; (2) keep the tax at its current rate and increase it
when the economy improves; (3) increase the rate by only
$0.01; or (4) increase the rate by $00.3331, the maximum
allowed.
Wilson, with concurrence from O'Callaghan, recommended
Option 1, advising that it would yield approximately
$600,000 in additional revenue. He informed Marisa Olguin
at the Chamber of Commerce of staff's recommendation and
that the matter was being discussed at this meeting, but it
did not appear that anyone from the Chamber was in
attendance. Wilson advised that the businesses seemed to
be in agreement with the continued $0.02 increase.
The City Council unanimously concurred with continuing the
annual $0.02 increase to meet the CPI maximum rate.
Wilson advised that a resolution would be brought back.
ORAL REPORTS
1. Conference/Seminar reports from Elected Officials for the
period of June 14 through June 20, 2010.
The Mayor reported that none of the City Council Members
attended conferences or seminars during the period of June
14 through June 20, 2010.
2. City Administrator Reports.
City Administrator Donal O'Callaghan reiterated some of
Fresch's comments with regard to debt restructuring.
O'Callaghan advised that roughly 600-700 of the review of
the proposed fiscal year 2010-2011 budget had been
completed and the meeting for the remaining portion would
be held June 23, 2010, at 2:30 p.m. Councilman Maisano
advised he would not be able to attend the June 23rd
meeting.
O'Callaghan deferred to Transmission and Distribution
Manager Carlos Fandino to report on a significant outage.
Fandino reported that the outage occurred on June 14, 2010,
at approximately 8:45 a.m. as a result of a semi truck
hitting a power pole at the intersection of Fruitland and
Boyle. Four 7kV feeders and one 16kV feeder at Sierra Pine
were affected, 23 megawatts of load were lost, and
approximately 180 customers were affected. Full
restoration was achieved within two hours and twelve
minutes.
Fandino advised that City Hall will now be fed from Feeder
4, rather than Feeder 47, thereby reducing the impact of
future outages to City Hall. Councilman Davis concurred.
O'Callaghan advised that the transformer for City Hall is
also being looked at due to its age. Fandino stated it is
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June 21, 2010
over 30 years old and is experiencing some voltage issues.
Davis asked if anyone reported a plate number on the truck
that caused the outage. Fandino stated that a partial
plate number was obtained and forwarded to the Police
Department, but there wasn't much that could be done with
partial plate. Customers need to be advised to take down
all the information; that would give the City the best
chance of recovering money lost during outages, especially
expensive ones like this was.
Police Chief Towles advised that the Police Department
would run the partial plate through its system and send a
reverse 911 to the customers to see if any additional
information is provided, and then report back.
3. City Council Reports.
None of the City Council Members had anything to report at
this time.
At 9:49 a.m., it was moved by McCormick and seconded by Maisano,
that the City Council take a short recess. Motion carried, 5-0.
At 9:59 a.m., all five members of the City Council in attendance
prior to the recess reconvened in open session.
It was moved by McCormick and seconded by Newmire, that the City
Council enter into closed session to discuss the items listed on
the closed session agenda. Motion carried, 5-0.
At 10:24 a.m., the City Council resumed open session.
CLOSED SESSION REPORT OUT
The City Attorney reported as follows:
1. PUBLIC EMPLOYEE DISCIPLINE/DISMISSAL/RELEASE
The City Council unanimously voted to issue a written
reprimand to a Utilityman III per the recommendation of
the Director of Community Services & Water.
2. CONFERENCE WITH LABOR NEGOTIATOR
a. Agency Designated Representative: City Administrator
Employee Organization: Vernon Police Officers Benefit
Association
No reportable actions.
3. CONFERENCE WITH LEGAL COUNSEL - ANTICIPATED LITIGATION
Potential initiation of litigation pursuant to
subdivision (c) of Government Code Section 54956.9.
Number of potential cases: 1
No reportable actions.
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4. PUBLIC EMPLOYMENT
a. Police Chief
No reportable actions.
5. PUBLIC EMPLOYEE APPOINTMENT
a. Police Chief
The City Council unanimously voted to appoint Police
Captain James Rodino to the position of Interim Police
Chief, effective upon the retirement of Police Chief
Steve Towles.
The City Clerk announced that there were no further items on the
agenda.
At 10:28 a.m., it was moved by McCormick and seconded by
Newmire, that the meeting be adjourned. Motion carried.
Willard G.
City Clerk
Hilario Gonzales
Mayor
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