Attachment 2

City Council Meeting Minutes

May 15, 2018
SPECIAL MEETING
Tuesday, May 15, 2018
4:30 PM

CALL TO ORDER AND ROLL CALL

Mayor Dallas called the meeting to order at 4:32 p.m.
Present: Councilmembers Richards, Theis, Reimers, Hardy, Mayor Dallas.
Absent: None
Staff: Chip Rerig, City Administrator
Glen Mozingo, City Attorney
Marc Wiener, Director, Community Planning & Building
Sharon Friedrichsen, Director of Budgets and Contracts
Bob Harary, Director, Public Works
Paul Tomasi, Chief of Police/Director, Public Safety
Maxine Gullo, Assistant City Administrator
Ashlee Wright, Director, Library and Community Activities
Tom Graves, City Clerk
PLEDGE OF ALLEGIANCE
Director of Community Planning and Building Marc Wiener led the pledge.
ANNOUNCEMENTS
Mayor Dallas announced that the new City website is up and running.
PUBLIC APPEARANCES
None
ORDERS OF BUSINESS
Item 1: Receive a presentation on the Fiscal Year 2018-2019 Proposed Budget and
provide
direction to staff.
City Administrator Rerig said that the purpose of tonight’s meeting is to receive
public comments and questions. In addition, to submit questions in writing, the
public is asked to do so not later than May 25, 2018.

Director Friedrichsen said the FY 2018-19 budget would be in balance.

Councilmember Richards inquired about the possibility of setting up a Section

411 trust for the #2 Side Fund with CalPERS. Mr. Rerig said it’s under
consideration.

Councilmember Hardy questioned the amount set aside for Legal Fees. The
PowerPoint shows one amount, while the Budget Book shows another. Director

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City Council Meeting Minutes

May 15, 2018

Friederichsen explained. Councilmember Hardy also questioned the 5%

payment to the State on ambulance revenue, which is a new fee. Also, last year
the County administrative fee was 2.47%, but this year is going up to 6%, which
is a $24,000 change.

SPEAKING FROM THE FLOOR

Ms. Schwartz spoke with concerns about pensions.

John Lloyd, Carmel Chamber of Commerce Chair, asked that the City
continue its 3% funding increase. He enumerated the ways the Chamber
will be affected if the funding is discontinued.

Barbara Livingston and Dick Stiles encouraged funding for succession trees
and also expressed opposition to Director.

Georgina Armstrong asked the City Council to use the proposed $182,995
not for the MCCVB but for a restricted fund for Carmel Beach bluffs, Scenic
Pathway and the Mission Trail Nature Preserve. She would also like the
fund to be maintained in the future for the same purpose, and suggested an
annual 3% increase to the fund for inflation.

Sue McCloud inquired about the City’s Fitch rating, and also asked the
aggregate amount of unreserved funds.

Amy Herzog spoke on behalf of Visit Carmel, and gave an overview of what
MCCVB does versus Visit Carmel. MCCVB is adept at out-of-state
marketing, including Visit California. Visit Carmel is best at leveraging in-
state advertising.

Ben Beesley spoke in support of the proposed $182,995 for the MCCVB.

Rob O’Keefe, Chief Marketing Officer for MCCVB, spoke of a new program
at CVB called Sustainable Moments, that will be put in every shop,
restaurant, hotel and motel room, etc., reflecting the norms and values of
the community. He encouraged the Council to support the proposed
$182,995 for the MCCVB.

Janine Chicourrat encouraged the Council to support the proposed

$182,995 for the MCCVB. She said in the recent past the City of Pacific
Grove decided to drop out of the MCCVB, and that they wanted back in in
about two years’ time. She encouraged the City Council not to make the
same mistake.

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Mayor Dallas inquired about Senate Bill 1. Mr. Rerig said that SB1, the
Road Maintenance and Rehabilitation Account (RMRA) increased the Gas
Tax as well as Auto Registration Fees. The item is up for repeal in
November which, if it passed, would have a detrimental effect on the City’s
revenue.

Also in response to Mayor McCloud, Mr. Rerig said he doesn’t have our
Fitch Rating off-hand, but he would inquire of the Auditors and would let Ms.
McCloud know.

Mayor Dallas encouraged members of the public to get questions about the
budget to the City Clerk or to the Budget Director by 5:00 p.m. on May 25,
2018. He said those questions would be answered in public at the June 5,
2018, City Council meeting.

Councilmember Reimers asked about the process going forward. Mayor

Dallas said that even when he was on the City Council the issue of funding
for the Chamber versus funding for the MCCVB always comes up. He said
it was helpful of Mr. Lloyd to explain that funding for MCCVB is .72% of the
City’s budget. Mayor Dallas would like MCCVB to work hand-in-hand with
the Sunset Center to make more bookings there. He said he'd asked them
to do so for quite some time now, but it never seems to come to fruition. He
said that to the best of his knowledge, MCCVB hasn’t yet contacted the
Sunset Center to even discuss how they could increase bookings.

Councilmember Reimers agreed with Mayor Dallas, and said she supports
the City contribution to MCCVB.

Councilmember Richards said the MCCVB does work with Sunset

Center on occasion, and most recently in securing hotel suites for Burt
Bacharach and his band.

Councilmember Hardy said she recently saw a PowerPoint where

proposed revenue for MCCVB was $6.9M. Salinas and Marina are
reducing their contributions from 3% to 2%. She would like the City to do
that as well, and to withhold some of that back until they begin to promote
the Sunset Center.

Mayor pro tem Theis said that it takes years to build up tourist revenue,
and it can be gone in a minute. She also questioned using Salinas and
Marina as examples, since their demographics are so different from
Carmel’s. She said she would not support a decrease in funding for
the MCCVB, but understands the Council's perspective regarding the
Sunset Center.

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Councilmember Richards said he would welcome the opportunity to meet
with them again and develop goals and objectives. Councilmember Hardy
agreed with Councilmember Richards. Councilmember Richards said he
would support the budget as written.

Councilmember Hardy said she was concerned about the cost of the
ambulance, and asked Chief Tomasi to return at a later date to update the
Council. Ms. Hardy also said that a more realistic line item is the one for
legal and professional services. She wants to increase the legal and
professional services line item by $300k. She cautioned that knowing
what’s on deck, as we do, we may not pick and choose our cases, and it’s
important to add an additional $300k to add to the existing $460k.

Mayor pro tem Theis also shared her concern about ambulance overtime.
Regarding extra funding for the City Attorney, she opined that perhaps it’s
a difference in philosophy. She understands why Councilmember Hardy
made the proposal, and she’s open to discussing it. On a final note, she
said she is happy with the Capital Improvement Project budget.

Councilmember Reimers inquired about the pros and cons of mail service.
She said she’s glad the City is putting more into parks, but it seems like an
impossible task to find $300k right now.

Councilmember Richards asked about previous City Attorney annual

budgets, and also inquired if there is a matrix or rubric for the City to use.

City Attorney Mozingo said the FY 2014-15 budget was $844k, and bore
no relationship to the population. Last year, the Attorney’s office was
busier than ever and, after discussions, said the Office of City
Attorney is currently on track to spend $662k. The City Attorney did
recover $85k, which was returned to the General Fund. Liability
Insurance is going to double because underwriters recognize that more
claims are coming into the City, which helps to make defending the City
more expensive.

Mayor Dallas passed out a page listing of 17 positions that are

currently funded yet unfilled. He asked Councilmembers to read the list
before the next Council meeting and to come back with questions or
answers.

Councilmember Hardy said those 17 positions are just placeholders in

terms of hiring. She sees some positions on that list that might be done
away with. And she reminded all that each individual hired onto this list
would create a pension obligation for life.

Once again, the Mayor asked for questions to be sent to the City Clerk no
later than Friday, May 25, 2018, at 5:00 p.m.
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City Council Meeting Minutes

May 15, 2018
ADJOURNMENT
The meeting was adjourned 6:28 p.m.

APPROVED: ATTEST:

________________________________ _____________________________
Steve G. Dallas, Mayor Thomas A. Graves, MMC
City Clerk

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