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20120904 Regular City Council Meeting - MinutesMINUTES OF THE REGULAR CITY COUNCIL MEETING OF THE CITY OF VERNON HELD TUESDAY, SEPTEMBER 4, 2012, IN THE COUNCIL CHAMBER OF THE CITY HALL LOCATED AT 4305 SANTA FE AVENUE, VERNON, CALIFORNIA MEMBERS PRESENT: Davis, McCormick, Maisano, Ybarra MEMBERS ABSENT: None The meeting was called to order at 9:00 a.m. by Mayor Pro-Tem Davis. Councilman Ybarra led the flag salute. Special Legal Counsel Dana Reed announced two proposed changes to the agenda. First, it is requested that the presentation item concerning the Oath of Office for Teresa McAllister be heard first. Second, Counsel requests to add closed session item that deals with pending litigation concerning Reno Bellamy. The matter was brought to staff's attention on Thursday, after the posting of the agenda. Reed further clarified that a hearing on a writ petition filed by Bellamy is being heard this morning in the Los Angeles Superior Court and Legal Counsel, Marguerite Leoni, may need to receive instructions from Council. It was moved by McCormick and seconded by Maisano to amend the agenda as requested. Motion carried, 4-0. PRESENTATIONS 1. Oath (Affirmation) of Office to be administered by the City Clerk to newly appointed Human Resources Director Teresa McAllister. Brief self -introduction of Ms. McAllister. The Oath was administered by Dana Reed. City Administrator, Mark Whitworth gave a brief background on the search firm process. He is pleased Mrs. Teresa McAllister accepted the terms of employment. He stated that the position is much needed and welcomed McAllister. New Human Resources Director, Teresa McAllister thanked everyone, and looks forward to working with staff. PUBLIC COMMENT Dana Reed announced that this was the time allotted for public comment. Mayor Pro-Tem Davis inquired whether anyone in the audience wished to address the City Council. Craig Dressen of Dressen Properties thanked Interim Police Chief, Daniel Calleros, for his presentation at the last meeting. Dressen advised that many agencies were transitioning to County services, and reported on conversations he has had with other agencies. Dressen stated that the property owners will have to pay for the safety services. He stated that Council has already made up their minds, but warned that if the City doesn't make cost cutting decisions, the City will risk elimination. Regular City Council Meeting Minutes September 4, 2012 PRESENTATIONS Service 'Pin Awards: Mayor Pro-Tem Davis presented Lieutenant Anthony Zack, Utilityman I Juan Arellano, and Lietenant Robert Sousa with service pins for their various years of service. Fire Captains Stephen Agon, Michael Busch, John Cusolito, and Will Neisley, Fire Engineers Bradley Miller and Paul Woida, and Battalion Chief Michael Wilson were acknowledged for their years of service as they were not able to attend the meeting. MINUTES It was moved by McCormick and seconded by Ybarra to approve the Minutes of the Special City Council Meeting held June 20, 2012, at 1:00 p.m. Motion carried, 4-0. It was moved by McCormick and seconded by Ybarra to approve the Minutes of the Special City Council Meeting held June 25, 2012,. and the Minutes of the Special City Council Meeting held June 27, 2012. Motion carried, 3-0-1, with Maisano abstaining. CONSENT CALENDAR It was moved by Ybarra and seconded by Maisano, that the matters on the Consent Calendar be approved as recommended. Motion carried, 4-0. 1. Warrant Registers a. Approval of City Warrant Register No. 1363, totaling $1,082,228.74, which covers the period of August 14, through August 27, 2012, and consists of the following: 1. Ratification of wire transfers totaling $591,383.15; and 2. Ratification of the issuance of early checks totaling $317,548.11; and 3. Authorization to issue pending checks totaling $173,297.48. b. Approval of Light & Power Warrant Register No. 328, totaling $3,659,034.50, which covers the period of August 14, through August 27, 2012, and consists of the following: 1.Ratification of wire transfers totaling $3,534,681.21; and 2. Ratification of the issuance of early checks totaling $14,043.90; and 3.Authorization to issue pending checks totaling $110,309.39. c. Approval of Gas Warrant Register No. 116, totaling $4,989.44, which covers the period of August 14, through August 27, 2012, and consists of the following: 1. Ratification of the issuance of early checks totaling $904.07; and Page 2 of 11 Regular City Council Meeting Minutes September 4, 2012 2. Authorization to issue pending checks totaling $4,085.37; and 3. Authorization to void check no. 870 in the amount of $105.00. 2. Fire Department a. Activity Report for the period of July 16, through July 31, 2012, to be received and filed. b. Activity Report for the period of August 1, through August 15, 2012, to be received and filed. 3. Light & Power Department a. May 2012 Resource Procurement Report, to be received and filed. 4. Police Department a. Activity Log and Statistical Summary of Arrest and Activities for the period of August 1, through August 15, 2012, to be received and filed. RESOLUTIONS 1. City Administration a. Resolution No. 2012-173 - A Resolution of the City Council of the City of Vernon Authorizing Reimbursement of Certain Costs Incurred by Current Vernon City Personnel in Connection with a Review by the California Public Employees, Retirement System ("Ca1PERS") Note, William McCormick, Mark Whitworth, Willard Yamaguchi, and Rory Burnett excused themselves from the Council Chambers during the discussion pertaining to the above reference. Special Legal Counsel Dana Reed reported that the matter had been agendized at a previous City Council meeting but was postponed. The resolution deals with various incumbent personnel and their benefits. Due to the nature of the circumstances, staff has requested the assistance of outside counsel with a maximum expense not to exceed $25,000 per employee. In response to Councilmember Maisano, Reed confirmed that it does not concern previous retired employees or their benefits, only the current City employees. It was moved by Ybarra and seconded by Maisano to approve Resolution No. 2012-173. Motion carried, 3-0-1, McCormick was excused from the item. b. Resolution No. 2012-174 - A Resolution of the City Council of the City of Vernon Authorizing the Issuance of a Request for Proposals for the Function of Strategic Communications Advisor City Administrator, Mark Whitworth reported on the request to seek proposals for an advisor that will help communicate Page 3 of 11 Regular City Council Meeting Minutes September 4, 2012 Vernon's message as part of the reform movement. The request has a cap of $5,000 per month. Councilmember Ybarra opined that there isn't a need for the request. Ybarra stated that the City has a Public Information Officer, and inquired if the functions could be added to his duties. He also recommended that the item be postponed until after the September 18, 2012, election and that no action be taken at this time. In response to Mayor Pro-Tem Davis' inquiry on the need, Whitworth responded that in dealing with Sacramento, the advisor would reduce lobbying costs. The advisor would assist in changing past perceptions of Vernon. In response to Councilmember McCormick's inquiry on whether Public Information Officer, Fred MacFarlane could perform the functions, Whitworth reported that MacFarlane interfaces with news and media, whereas the scope of work requested is more of a gathering of information. Councilmember Maisano inquired whether having the advisor would result in a savings in lobbying expenses. In response, Whitworth advised that this could potentially reduce expenditures. Councilman Ybarra stated that if it was not going to reduce expenses then he was in opposition. Whitworth advised that a consultant group would be less expensive than an attorney. This is part of the efforts being made, to become more fiscally responsible. Independent Reform Monitor John Van De Kamp shared Councilmember Ybarra's sentiments, but opined that the request for proposals ("RFP") can be issued without committing the City to future expenses. Based on the proposals, Council can have a better understanding on the functions an advisor would be providing. Van de Kamp reasoned that by the time proposals are received, the election would have taken place. Van de Kamp recommended the approval of the RFP but advised that proposals should be reviewed carefully. It was moved by McCormick and seconded by Maisano approve Resolution No. 2012-174. Motion carried, 4-0. c. Resolution No. 2012-175 - A Resolution of the City Council of the City of Vernon Authorizing the Issuance of a Request for Proposals for the Function of Grant Coordinator City Administrator, Mark Whitworth advised that the request for a coordinator would help identify federal and state grants for which the City might be eligible. A grant coordinator could easily pay for itself. The request for proposals has a cap not to exceed $4,000 per month. Mayor Pro-Tem Davis inquired whether Assistant to City Administrator, Alex Kung already performed this function. Whitworth explained that the coordinator would assist all departments, and identify grants to assist with expenses. Page 4 of 11 Regular City Council Meeting Minutes September 4, 2012 Councilmember Ybarra inquired whether the coordinator could assist with the Community Benefit Fund. In response, Whitworth advised that the coordinator could write grants for surrounding communities that can not afford them. He advised that it's a possibility that the City could get credit for such grants. It was moved by Ybarra and seconded by Maisano to approve Resolution No. 2012-175. Motion carried, 4-0. d. Resolution No. 2012-176 A Resolution of the City Council of the City of Vernon Appointing Dana W. Reed to Serve as the Acting City Clerk of the City of Vernon, Approving a Related Addendum to the Reed & Davidson Agreement, and Certain Other Personnel Assignments i. Affirm Willard Yamaguchi serve exclusively as the Chief Deputy City Attorney and be relieved of the duties of Risk Manager and City Clerk. ii. Authorize the prospective Acting City Clerk to hire a part-time Administrative Assistant. iii. Authorize the prospective Acting City Clerk to retain temporary support services for the City Clerk's office. In line with reform efforts, City Administrator, Mark Whitworth advised that the recommendation would further eliminate the practice of multiple positions held by one employee. Whitworth explained that currently the City Clerk is also the Risk Manager and handles the City Attorney functions. The recommendation will place Willard Yamaguchi in the role he was initially hired to fill, Chief Deputy City Attorney. It also places Dana Reed as [Interim] City Clerk until the search firm process can find a permanent replacement. Whitworth also reported that his dual roles as City Administrator and Fire Chief will be the final item to address. Whitworth reported that the recommendation was intended to be effective September 10, 2012, but requested that the resolution be amended to take effect immediately. It was moved by McCormick and seconded by Ybarra to approve Resolution No. 2012-176 with September 4, 2012, as the effective date, and all subsequent requests. Motion carried, 4-0. 2. Community Services and Water Department a. Resolution No. 2012-177 - A Resolution of the City Council of the City of Vernon Approving and Authorizing the Execution of a Measure R Funding Agreement By and Between the City of Vernon and the Los Angeles County Metropolitan Transportation Authority Regarding the Interstate 710 South Early Action Projects Public Works & Water Superintendent, Scott Rigg reported that the City will be working with Chambers Group; the proposed agreement will allow the City to get reimbursed for the service Page 5 of 11 Regular City Council Meeting Minutes September 4, 2012 fees. Rigg confirmed that there was no direct expense to the City. It was moved by McCormick and seconded by Maisano to approve Resolution No. 2012-177. Motion carried, 4-0. 3. Finance Department a. Resolution No. 2012-178 - A Resolution of the City Council of the City of Vernon Authorizing and Approving the Amendment and Restatement of the Interest Rate Swap Transaction with Morgan Stanley Capital Services Inc; Approving the Related Form of Amended and Restated Confirmation; and Authorizing Certain Other Matters Relating Thereto Finance Director, Rory Burnett reported on the 2008 bonds and the interest rate swaps. He explained the restricted versus unrestricted flow and use of funds. He reported that currently Morgan Stanley has $11 million in collateral. Craig Underwood of Bond Logistics assisted in the renegotiation of the terms to forgo the $11 million and free up $3 million per year to be used for other purposes. Burnett explained it's anticipated used as part of the rebate program in the Light & Power Department. Underwood reported on the complex transaction and on his efforts to reduce expenses in the Light & Power Department. Underwood explained that the proposed transaction will eliminate payment on the interest rate swap for approximately the next 3.5 years. Underwood explained the risk of the proposal in that there are scenarios where the City would be better off not going through with the proposed transaction. Underwood opined that such a scenario was unlikely, and that the primary risk was short-term. In response to Councilmember Ybarra, Underwood explained that the transaction would reduce the balance currently held by Bank of America from $31 million to $20 million, and explained that it does not remove the risk of collateral for moneys owed over the $20 million. Underwood confirmed that it would eliminate the monthly payment owed for the next 3.5 years. In response to Ybarra's concerns, Underwood explained that regardless of the proposed transaction, if interest rates increase the City will still owe. Underwood advised that the long-term effects are uncertain but that there may be an opportunity to terminate the interest rate swap if conditions are favorable in the future. Whitworth opined that the proposal is viable. By freeing up $3 million for the next three years, it will facilitate the rebate program. Underwood explained that the $11 million is restricted money, and by approving the transaction it is a means to funnel the money to the rate payers as part of the rebate program. In response to Mayor Pro-Tem Davis, Burnett responded that the $150,000 was Morgan Stanley's fee for the transaction. Underwood explained that the fee would cover Morgan Stanley's portion, Bond Logistics', and attorney fees. Page 6 of 11 Regular City Council Meeting Minutes September 4, 2012 It was moved by McCormick and seconded by Ybarra to approve Resolution No. 2012-178. Motion carried, 4-0. 4. Fire Department a. Resolution No. 2012-179 - A Resolution of the City Council of the City of Vernon Approving and Authorizing the Execution of a First Amendment to Agreement Number C-116286 by and between the City of Vernon and the City of Los Angeles regarding the 2008 Urban Areas Security Initiative Grant Program Fire Chief, Mark Whitworth reported that the Urban Areas Security Initiative is the parent agency that handles and coordinates federal and state grant funds. The agreement is procedural in order to participate in the grant funds. It was moved by Ybarra and seconded by McCormick to Approve Resolution No. 2012-179. Motion carried, 4-0. NEW BUSINESS 1. Authorization to purchase medium voltage underground cables from HD Supply. Director of Light & Power, Carlos Fandino advised that the request will replenish inventory levels. He advised that the money used is part of the bond proceeds. It was moved by McCormick and seconded by Maisano to authorize the purchase of voltage underground cables. Motion carried, 4-0. 2. Authorization to approve Change Order No. 1 extending the service agreement with Doty Bros. Equipment Company for one year commencing November 1, 2012, and approving the new cost schedule. Public Works & Water Superintendent, Scott Rigg reported that Doty. Bros performs work beyond the department's capabilities, such as emergency mainline repairs. It was moved by Ybarra and seconded by Maisano to authorize Doty Bros. Equipment Company's Change Order No. 1. Motion carried, 4-0. 3. Authorization to approve Change Order No. 1 extending the service agreement with Valverde Construction, Inc. for one year commencing November 1, 2012, and approving the new cost schedule. Public Works & Water Superintendent, Scott Rigg reported that Valverde Construction performs the same function as Doty Bros. Valverde is the primary contractor, should they be unavailable then Doty Bros. is contacted. City Administrator, Mark Whitworth further clarified that it is standard practice for cities to have such service contracts in place in case of an emergency. It protects the City from being overcharged for services. Page 7 of 11 Regular City Council Meeting Minutes September 4, 2012 It was moved by Maisano and seconded by Ybarra to authorize Valverde Construction, Inc.'s Change Order No. 1. Motion carried, 4-0. 4. Authorization to settle a property damage incident. [Interim] City Clerk, Dana Reed reported on the traffic incident which resulted in approximately $7,700 in damages. The City received an offer to settle in the amount of $5,000, as this is the limit on the driver's insurance policy. It was moved by McCormick and seconded by Maisano to authorize the property damage incident settlement in the amount of $5,000. Motion carried, 4-0. DISCUSSION ITEMS 1. Staff's quarterly update on the budget. Assistant to City Administrator, Alex Kung reported on closing figures from June 30, 2012, advising that the figures were still preliminary. The general fund was under budget, primarily due to the dept service payment which had not been paid since'the sale of a property is still under negotiations. Also, the postponement of capital work has reduced expenses. Kung reported on an increase in public safety expenses due to the settlement of a lawsuit. Kung explained that the transaction is a one-time liability expense. Kung reported on increase in insuranceliability costs, which are Citywide, and will most likely have to de distributed throughout the various departments. High legal expenses were due to the JLAC and CalPERS audits as well as the contested election process. He advised that overall all other departments have kept costs down. Kung reported that the parcel tax had yet to be recorded but that $7.8 million was received which will be netted against the general fund budget. Kung reported on the enterprise funds which include Light & Power, Water, Gas, Natural Gas and Fiber Optics. Kung advised that with lower Light & Power costs, revenue was also lower. He further explained that it was not due to a reduction in load but rather investments lost in swaps. This loss is netting against the revenue. Kung advised that the general fund is still closing its books, pending end -of -the -year adjustments to prepare for the auditors. Kung advised that further updates will be provided at a later date. ORAL REPORTS Interim Police Chief Daniel Calleros reported on an investigation on August 15, 2012, conducted by Detective Herrera and members of the CTIP Cargo Theft Task Force. The investigation yielded a recovery of stolen merchandise totaling approximately $300,000 that was initially reported July, 2012, in Portland, Oregon. During the investigation approximately $120,000 in furniture from a theft reported in Fontana was also recovered. Page 8 of 11 Regular City Council Meeting Minutes September 4, 2012 On August 21, 2012, officers found several stolen backflow valves and water meters in the trunk of a vehicle which was parked in an unsecured parking lot. The female suspect who had been found sleeping in the vehicle was arrested for possession of stolen property. Calleros noted that there had been a number of reported thefts of water valves and meters within the southeast region. Calleros reported on an incident that occurred on August 28, 2012. Patrol officers responded to the 2700 block of Indiana Street in reference a man down. Officers and Vernon fire paramedics immediately performed CPR, but after exhausting all life saving measures, the individual was pronounced dead at the scene. There was no evidence of foul play and it is believed that the individual died of natural causes. On September 2, 2012, patrol officers responded to a burglary alarm in the 5300 block of Alcoa Avenue. When officers arrived, a business representative advised officers that he had witnessed two bobtail trucks leaving the company lot. He followed the truck were it was abandoned at the corner of Slauson and State Avenue. The two subjects in the truck left the scene on foot. All property was recovered at the scene and Detectives will be following up on leads and reviewing the surveillance cameras. On September 3, 2012, during a traffic violation it was discovered that the passenger of the motorcycle was concealing a shotgun. The officer immediately controlled the subject pending the arrival of assisting officers. Both the driver of the motorcycle and the passenger were subsequently taken into custody. Calleros noted that the shotgun was modified with a small handheld grip to allow for easy concealment. Captain James Rodino reported on a vandalism that occurred on August 26, 2012. Three suspects were arrested. Assistant Fire Chief, Andrew Guth reported that most responses have been routine in nature. However, Fire did respond to a mutual aid request for a commercial fire in Compton. The training focus for the month of September is urban search and rescue. Staff will also be participating in high-rise training in Long Beach. Guth reported that the new fire apparatus had been received, and were in the process of selling the old apparatus. Director of Light & Power, Carlos Fandino reported on AB2196 advising that it had passed and grandfathered Vernon's contracts. However, he advised that whether bio-methane gas is included as part of the Bucket 1 requirement is open to interpretation. Fandino reported that the pigging on the gas transmission line was about to commence, and advised that the work on Fruitland is ongoing. Fandino reported an incident on August 26, 2012, caused by a balloon but resulted in no outages. On August 29, 2012, a pole fire caused by a burned line insulator resulted in the replacement of the power pole. Page 9 of 11 Regular City Council Meeting Minutes September 4, 2012 Fandino announced the cancellation of the Advisory Committee on Electric Rates meeting. He explained that the meeting will be rescheduled in November or December when there is more information on the utility user tax. David LeDuff, Chief Deputy Director, reported on the Sustainable Development and Energy Efficiency Commission meeting held August 22, 2012. LeDuff announced the Sustainability Open House scheduled for October 18, 2012. Public Works & Water Superintendent, Scott Rigg announced that the slurry seal street project had been completed. He advised that the preliminary report had been received on possible repairs to Well No. 21, and reported on the commencement of repairs to the elevated tank. Rigg also announced the cancellation of the Advisory Committee on Business Development meeting for the month of September. In response to Mayor Pro-Tem Davis, City Administrator, Mark Whitworth reported on three meetings regarding the housing proposals. The housing development will be a future agenda item, and will add approximately 35-45 units. Projected timeframe for the project is 1.5 to 2 years. Assistant to City Administrator, Alex Kung announced the cancellation of the Oversight Board to the Successor Agency to the Redevelopment Agency meeting for the month of September. The next meeting is scheduled for October 4, 2012. City Administrator, Mark Whitworth announced that the next Vernon Housing Commission meeting is scheduled for September 19, 2012, at 6:00 p.m. The Commission will be discussing unit -to - unit transfer procedures. Whitworth announced that the election contest hearing is scheduled for September 10, 2012 at 9:30 a.m. and will continue September 11, 2012 at 9:30 a.m. if necessary. Ballots for the September 18, 2012, election have been mailed. Whitworth recommended that any registered voter who had not received their ballot should contact the City Clerk Department. Whitworth reported on the Ca1PERS resolution which will be presented in the near future. He reported that AB340 had passed and will affect new employees, effective January 1, 2013. The JLAC audit response included the Van de Kamp report and recent accomplishments. Whitworth announced that brochures for both Finance Director and Police Chief positions are available, and will go through the search firm process. He advised that the same process will be done for the City Clerk position and congratulated Reed on his appointment. Whitworth reported on the League of California Cities Conference in San Diego and on his, Davis, McCormick, and Reed's attendance. [Interim] City Clerk Dana Reed announced that there was no need for a closed session. Page 10 of 11 Regular City Council Meeting Minutes September 4, 2012 At 10:38 a.m., it was moved by McCormick and seconded by Maisano, that the meeting be adjourned. Motion carried. A TES Dan& VReed Interim City Clerk William J. Dav', Mayor Page 11 of 11