Agenda packet — Cypress City Council, May 8, 2023 (part 1 of 2)

AGENDA

REGULAR MEETING

CYPRESS CITY COUNCIL
May 8, 2023
4:00 P.M. - Workshop & Closed Session
6:00 P.M. - General Session
www.cypressca.org 5275 Orange Avenue
Cypress, California
Interested in speaking to the City Council? Information about participating in the City Council meeting appears at the end of the agenda.

CALL TO ORDER
4:00 P.M.

Executive Board Room

ROLL CALL
Cypress City Council, also acting as the Ex-Officio Governing Board of Directors of the Cypress Recreation and Park District
Mayor Anne Hertz-Mallari
Mayor Pro Tem Scott Minikus
Council Member David Burke
Council Member Frances Marquez
Council Member Bonnie Peat
ORAL COMMUNICATIONS ON CLOSED SESSION / WORKSHOP ITEMS (Limited to 30 minutes - three minutes per speaker. The City Council may adjust the time allotted per speaker.)
The public may address the City Council on Closed Session/Workshop items prior to any action taken. Although Council Members may provide brief responses, the City Council may not engage in a discussion with members of the public during the meeting. Please complete a Speaker's Card to address the City Council in-person. Members of the public are encouraged to communicate with the City Council via email at [email protected] or by calling 714-229-6699.

WORKSHOP SESSION
Fiscal Year 2023-24 Proposed Budget and Capital Improvement Program

CLOSED SESSION

CLOSED SESSION
CONFERENCE WITH LEGAL COUNSEL - EXISTING LITIGATION
Pursuant to Government Code Section 54956.9(d)(1)
Southwest Voter Registration Education Project v. City of Cypress Case No. 30-2022-01270865-CU-CR-CJC
Orange County Superior Court
LIABILITY CLAIMS
Pursuant to Section 54956.95
Claimant: Council Member Frances Marquez
Agency claimed against: City of Cypress
CONFERENCE WITH LEGAL COUNSEL - EXISTING LITIGATION
Pursuant to Government Code Section 54956.9(d)(1)
Fortis LLP v. Frances Marquez, City of Cypress
Case No. 30-2022-01277792-CU-WM-CJC
Orange County Superior Court

RECONVENE
6:00 P.M.

Council Chambers

PLEDGE OF ALLEGIANCE

REPORT OF CLOSED SESSION / WORKSHOP
City Manager/City Attorney

PRESENTATIONS
American Public Works Association Award Presentation
Every 15 Minutes Presentation
National Police Week Proclamation
ORAL COMMUNICATIONS ON AGENDA ITEMS (Three minutes per speaker. The City May 8, 2023 | Page 2
ORAL COMMUNICATIONS ON AGENDA ITEMS (Three minutes per speaker. The City Council may adjust the time allotted per speaker.)
The public may address the City Council on agenda items prior to any action taken. Although Council Members may provide brief responses, the City Council may not engage in a discussion with members of the public during the meeting. Please complete a Speaker's Card to address the City Council in-person. Please follow the instructions at the end of the agenda and wait for the Mayor/City Clerk to call on you to address the City Council virtually. Speakers providing in-person comments will be called first. Members of the public are encouraged to communicate with the City Council via email at [email protected] or by calling 714-229-6699.

CONSENT CALENDAR
All matters listed on the Consent Calendar are to be approved with one motion unless a Council Member requests separate action on a specific item.

1. Receive and File Public Comments Submitted for the May 8, 2023 City Council Meeting
Prepared by: Alisha Farnell, City Clerk
Recommendation: Receive and file submitted public comments.

2. Introduce and/or Adopt All Ordinances and Resolutions Presented for Consideration by Title Only and to Waive Further Reading

3. Approve Minutes - Meeting of April 10, 2023
Prepared by: Alisha Farnell, City Clerk
Recommendation: Approve as submitted.

4. Receive and File Fiscal Year 2023-24 Proposed Budget and Capital Improvement Program
Prepared by: Peter Grant, City Manager
Recommendation:

1. Receive and file the FY 2023-24 Proposed Budget and Capital Improvement Program;

2. Schedule City Council consideration for adoption of the FY 2023-24 Budget on June 12, 2023; and

3. Publish a notice stating the public may comment on the Budget at the meeting of June 12, 2023.

May 8, 2023 | Page 3

5. Approve the City Engineer's Report and Renew Cypress Corporate Center Landscape Maintenance District No. 1 (Stanton Channel Berm) Prepared by: Doug Dancs, Director of Public Works
Recommendation:

1. Approve the City Engineer's Report for the Cypress Corporate Center Landscape Maintenance District No. 1 for Fiscal Year 2023-24; and

2. Adopt the attached Resolution declaring the City Council's intention to order the renewal of Cypress Corporate Center Landscape Maintenance District No. 1 for maintenance of the landscape and irrigation system located at the berm on the north side of the Stanton Channel and setting a public hearing for June 26, 2023.

6. Approve Senate Bill 1 Road Maintenance and Rehabilitation Account Funding and Project List
Prepared by: Doug Dancs, Director of Public Works
Recommendation: Adopt a Resolution approving the FY 2023-24 project list for Senate Bill 1 (SB1) Road Maintenance and Rehabilitation Account (RMRA) funding.

7. Approve the Conceptual Design for Cerritos Avenue Frontage Landscape Improvements, Project 320
Prepared by: Doug Dancs, Director of Public Works
Recommendation: Approve the conceptual design for Cerritos Avenue Frontage Landscape Improvements, Project 320.

8. Proclaim the Week of May 14-20, 2023 as National Police Week Prepared by: Alisha Farnell, City Clerk
Recommendation: Proclaim the week of May 14-20, 2023 as National Police Week.

9. Approve Plans and Specifications and Award a Contract for Tree Planting, Project 345
Prepared by: Doug Dancs, Director of Public Works
Recommendation:

1. Approve plans and specifications for Tree Planting, Project 345; and

2. Award a contract to Master Landscape & Maintenance, Inc. for $64,492 and authorize a contingency of $6,000.

May 8, 2023 | Page 4

10. Approve an Affordable Housing Agreement and Approve a Task Order with RSG, Inc for Buyer Verification Services for the Citrus Square Senior Community Prepared by: Alicia Velasco, Planning Director
Recommendation:

1. Approve an Affordable Housing Agreement with CypressMoodyM 2022, LLC; and

2. Approve a task order with RSG, Inc. for buyer verification services for an amount not to exceed $74,400.

11. Award Contracts for Citywide Traffic Signal Timing, Project 262 Prepared by: Doug Dancs, Director of Public Works
Recommendation:

1. Award a contract to Iteris, Inc., for $180,123 for Signal Timing Design Services, and authorize a contingency of $10,800; and

2. Approve a Task Order for Signal Timing Implementation to Hartzog & Crabill, Inc., for $21,060, and authorize a contingency of $2,200.

12. Southern California Edison Light Emitting Diode (LED) Fixture Replacement Rate Agreement
Prepared by: Doug Dancs, Director of Public Works
Recommendation:

1. Authorize the City Manager to execute the necessary application and agreement for conversion of Southern California Edison owned streetlights to Light Emitting Diode through the California Public Utilities Commission approved LS-1 Option E program; and

2. Establish color temperature specifications at 3000K for residential areas and 4000K for commercial and industrial areas.

13. Award a Contract for LED Street Sign Upgrades, Project 338 Prepared by: Doug Dancs, Director of Public Works
Recommendation:

1. Award a contract to Macadee Electrical Construction for $183,269, and authorize a contingency of $27,500; and

2. Approve a Task Order for Construction Inspection Services to Ardurra Group Inc., for $10,200, and authorize a contingency of $1,500.

May 8, 2023 | Page 5

14. Award a Contract for Parking Citation Processing
Prepared by: Mark Lauderback, Chief of Police
Recommendation: Award a contract to Data Ticket, Inc. to provide parking citation processing.

15. Approve a Prosecution Services Agreement with the County of Orange Prepared by: Mark Lauderback, Chief of Police
Recommendation: Approve a five-year agreement for prosecution services with the County of Orange.

16. Reject All Bids for Senior Center Interior Improvements, Project 290 Prepared by: Doug Dancs, Director of Public Works
Recommendation: Reject all bids for Senior Center Interior Improvements, Project 290.

NEW BUSINESS
None.

ITEMS FROM CITY COUNCIL MEMBERS

17. Consider Recommended Process for Council Members to Add Items to the City Council Agenda from Mayor Hertz-Mallari and Council Member Burke Agendized by: Ad Hoc Subcommittee - Mayor Hertz-Mallari and Council Member Burke
Recommendation: Approve the recommended policy for Council Members to add items to the City Council agenda.

ORAL COMMUNICATIONS ON ITEMS NOT ON THE AGENDA (Three minutes per speaker.

The City Council may adjust the time allotted per speaker.) The public may address the City Council on any item within the subject matter jurisdiction of the City Council. Although Council Members may provide brief responses, the City Council may not discuss nor take action on items that are not on the agenda. Please complete a Speaker's Card to address the City Council in-person. Please follow the instructions at the end of the agenda and wait for the Mayor/City Clerk to call on you to address the City Council virtually. Speakers providing in-person comments will be called first. Members of the public are encouraged to communicate with the City Council via email at [email protected] or by calling 714-229-6699.

COUNCIL MEMBER REPORTS AND REMARKS
May 8, 2023 | Page 6

CITY MANAGER REMARKS

ADJOURNMENT
The next meeting will be an adjourned Regular Meeting, to be held on Monday, May 22, 2023, beginning at 5:30 p.m. in the Executive Board Room.

I hereby certify under penalty of perjury under the laws of the State of California, that the foregoing Agenda was posted on the City Hall bulletin board and City website not less than 72 hours prior to the meeting. Dated this 3rd day of May, 2023.

________________________________
Alisha Farnell, City Clerk
May 8, 2023 | Page 7

PUBLIC PARTICIPATION
Members of the public can participate in the City Council meeting in the following ways:

1. Attend In-Person. First-come, first-served seating is available. All attendees must be free of any symptoms associated with contagious illnesses.

2. Attend Virtually via Webinar. Follow this link:
https://attendee.gotowebinar.com/register/321842877450288214. Advanced registration is recommended.

The public may address the City Council virtually during Oral Communications on Agenda Items/ Public Hearings/ Oral Communication on Items Not on the Agenda. Virtual participants must click the 'hand raise' button prior to the end of the first in-person speaker to indicate they wish to address the City Council. Upon clicking the 'hand raise' button, please unmute your microphone and wait for the Mayor/City Clerk to call on you. = Hand Raise = Unmute

3. Submit Public Comments Prior to the Meeting. The public may submit comments via email to [email protected]. Comments submitted by 3:00 p.m. on the day of the meeting will be added to the City Council agenda as a Consent Calendar item.

4. Watch the Meeting. The City Council meeting can be viewed on Spectrum Cable Channel 36 or on the City's website at www.cypressca.org/watchlive.

5. Listen to the Meeting. Listen-only teleconferencing is available by calling (415) 930-5321 and entering Access Code 289-207-733. No registration or audio pin is necessary.

INVOCATION POLICY
The City Council does not endorse the content of the invocation and does not endorse the invocational speaker’s particular faith, belief and/or religious denomination. The City Council has an established neutral policy for selecting and scheduling invocational speakers. The City Council’s policy on invocations is available from the City Clerk.

AMERICANS WITH DISABILITIES ACT
In compliance with the Americans With Disabilities Act, if you need special assistance to participate in this meeting, you should contact the City Clerk at (714) 229-6685 at least 72 hours prior to the meeting to enable the City to make reasonable arrangements to assure accessibility to this meeting.

May 8, 2023 | Page 8
CITY OF CYPRESS
CITY COUNCIL REPORT
City Council Regular 1.

FROM: Alisha Farnell, City Clerk
DATE: 05/08/2023
SUBJECT: Receive and File Public Comments Submitted for the May 8, 2023 City Council Meeting

RECOMMENDATION
Receive and file submitted public comments.

BUDGET IMPACT
None.

LEGAL REVIEW
None required.

APPROVED BY: Peter Grant, City Manager
CITY OF CYPRESS
CITY COUNCIL REPORT
City Council Regular 3.

FROM: Alisha Farnell, City Clerk
DATE: 05/08/2023
SUBJECT: Approve Minutes - Meeting of April 10, 2023

RECOMMENDATION
Approve as submitted.

BUDGET IMPACT
None.

LEGAL REVIEW
None required.

APPROVED BY: Peter Grant, City Manager
Attachments
April 10, 2023 City Council Meeting Minutes

REGULAR MEETING

CYPRESS CITY COUNCIL
APRIL 10, 2023
4:00 P.M.

A regular meeting of the Cypress City Council was called to order at 4:03 p.m. by Mayor Hertz-Mallari in the Council Chambers, 5275 Orange Avenue, Cypress, California.

STAFF PRESENT
City Manager Peter Grant
City Attorney Fred Galante
Director of Finance and Administrative Services Matt Burton City Clerk Alisha Farnell
Hunan Resources Manager Regina Nguyen

ORAL COMMUNICATIONS ON CLOSED SESSION/ WORKSHOP ITEMS
None.

CLOSED SESSION

CONFERENCE WITH LABOR NEGOTIATOR
Pursuant to Government Code Section 54957.6
Agency Negotiators: City Manager and Director of Finance and Administrative Services Employee Group: Cypress Police Management Association
CONFERENCE WITH LEGAL COUNSEL – EXISTING LITIGATION
Pursuant to Government Code Section 54956.9(d)(1)
Southwest Voter Registration Education Project v. City of Cypress Case No. 30-2022-01270865-CU-CR-CJC
Orange County Superior Court

LIABILITY CLAIMS
Pursuant to Section 54956.95
Claimant: Council Member Frances Marquez
Agency claimed against: City of Cypress
Mayor Hertz-Mallari recessed the meeting at 4:05 p.m.

RECONVENE
Mayor Hertz-Mallari reconvened the City Council meeting at 6:13 p.m.

Council Member David Burke
Council Member Frances Marquez
Council Member Bonnie Peat

STAFF PRESENT
City Manager Peter Grant
City Attorney Fred Galante
Director of Finance and Administrative Services Matt Burton Director of Public Works Doug Dancs
Director of Recreation and Community Services Jeff Draper Chief of Police Mark Lauderback
Planning Director Alicia Velasco
City Clerk Alisha Farnell
City Engineer Nick Mangkalakiri
Assistant City Engineer Daniel Co
Associate Planner Kori Sanders
Business Development Manager Robert Ramirez
Senior Management Analyst Kirsten Graham
INVOCATION Pastor Rob Ruark, SeaCoast Grace Church, led the Invocation.

PLEDGE OF ALLEGIANCE Ginger Osman, Senior Citizens Commissioner, led the Pledge of Allegiance.

REPORT OF WORKSHOP AGENDA / CLOSED SESSION
The City Attorney reported that the City Council met in Closed Session and held a discussion on each of the items listed on the Closed Session agenda.

Regarding the first item listed on the agenda, namely Conference with Labor Negotiator concerning the employee group Cypress Police Management Association, he reported the City Council received a briefing and no further reportable action was taken.

Regarding the second Closed Session item listed on the agenda, namely Conference with Legal Counsel – existing litigation, the matter of Southwest Voter Registration Education project v. City of Cypress. He reported that the City Council received a briefing from Attorney Stephen Churchwell and no further reportable action was taken.

Regarding the third Closed Session item listed on the agenda, namely Liability Claims, Claimant: Council Member Frances Marquez, Agency claimed against: City of Cypress.

The City Attorney stated Council Member Marquez did not participate in the discussion and was not present in the room while the balance of the City Council held a discussion and provided direction.

The City Attorney further reported that Mayor Pro Tem Minikus participated in all three Closed Session items via teleconference.

ORAL COMMUNICATIONS ON AGENDA ITEMS
Marilyn Reames, Cypress, spoke regarding Agenda Item No. 17.

Wanda Youngsma, Cypress, spoke regarding Agenda Item No. 17.

Helen Le (via virtual participation), Cypress, spoke regarding Agenda Item No. 8 on the March 27, 2023 City Council meeting agenda.

PUBLIC HEARINGS
Item No. 1: Approve a Site Plan Review, Tentative Parcel Map, and Mitigated Negative Declaration for the Goodman Commerce Center at 5757 Plaza Drive Mayor Hertz-Mallari opened the public hearing.

The Planning Director provided a report on this item.

Council Members asked questions of staff.

Mayor Hertz-Mallari invited the applicant to come forward.

The applicant agreed with the conditions of approval.

City Council asked questions of the applicant.

Mayor Hertz-Mallari asked Council Members to disclose any communications with anyone relevant to the item.

Council Members Burke, Minikus, Marquez and Peat disclosed general communication with the applicant.

Mayor Hertz-Mallari disclosed general communication with the applicant, City staff and former Mayor Jon Peat. Mayor Hertz-Mallari stated that the applicant has previously donated to her employer, the Boys and Girls Club of Great Anaheim-Cypress, however she further stated the amount of contributions made by the applicant does not warrant a conflict of interest.

Mayor Hertz-Mallari invited members of the public to speak on this item.

Mariellen Yarc, Cypress, spoke in support of this item on behalf of Cypress Chamber of Commerce.

Bob Youngsma, Cypress, spoke regarding concerns.

David Rose, Cypress, asked questions regarding this item.

Stephany Barragan, Cypress, asked questions regarding this item.

Edwin Kraemer (via virtual participation), Cypress, spoke in opposition to this item.

Helen Le (via virtual participation), Cypress, spoke regarding traffic concerns.

No further comments were made.

The applicant provided closing comments.

Mayor Hertz-Mallari closed the public hearing.

City Council discussion ensued.

A motion was made by Council Member Peat, and seconded by Council Member Burke, to adopt Resolutions approving a Site Plan Review and Tentative Parcel Map, and approve a Mitigated Negative Declaration for the Goodman Commerce Center at 5757 Plaza Drive.

The motion was carried by the following roll call vote:

AYES: 3 COUNCIL MEMBERS: Burke, Peat and Hertz-Mallari
NOES: 2 COUNCIL MEMBERS: Marquez and Minikus
ABSENT: 0 COUNCIL MEMBERS: None
RESOLUTION NO. 6922

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CYPRESS, CALIFORNIA, APPROVING SITE PLAN REVIEW NO. 2022-05, FOR

THE DEVELOPMENT OF TWO WAREHOUSE BUILDINGS AND
ASSOCIATED PARKING AND LANDSCAPING ON AN 18.6-ACRE SITE LOCATED AT 5757 PLAZA DRIVE IN THE MCDONNELL CENTER

SPECIFIC PLAN, IN THE CITY OF CYPRESS, CALIFORNIA
RESOLUTION NO. 6923

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CYPRESS, CALIFORNIA, APPROVING VESTING TENTATIVE PARCEL MAP NO. 2023- 101, FOR THE DEVELOPMENT OF TWO WAREHOUSE BUILDINGS AND ASSOCIATED PARKING AND LANDSCAPING ON A 18.6-ACRE SITE
LOCATED AT 5757 PLAZA DRIVE IN THE MCDONNELL CENTER SPECIFIC

PLAN, IN THE CITY OF CYPRESS, CALIFORNIA

PRESENTATIONS
The City Council presented a proclamation to West Cities Police Communications staff proclaiming April 9-15, 2023 as National Public Safety Telecommunications Week.

PUBLIC HEARINGS (continued)
Item No. 2: Approve Conditional Use Permit No. 2023-02 for Eight Apartments at 8561 Belmont Street
Mayor Hertz-Mallari asked Council Members to disclose any communications with anyone relevant to the item.

No communications were disclosed.

Mayor Hertz-Mallari opened the public hearing.

The Associate Planner provided a report on this item.

Council Members asked questions of staff.

Council Member Hertz-Mallari invited the applicant to come forward.

The applicant agreed with the conditions of approval.

City Council asked questions of the applicant.

Mayor Hertz-Mallari invited members of the public to speak on this item.

Julie Steenhoven, Cypress, spoke in opposition to this item.

Juan Ramirez, Cypress, spoke in opposition to this item.

Edwin Kraemer (via virtual participation), Cypress, spoke regarding concerns.

Helen Le (via virtual participation), Cypress, spoke regarding concerns.

The applicant provided additional comments.

City Council discussion ensued.

Stephany Barragan, Cypress, spoke regarding concerns.

No further comments were made.

The applicant provided closing comments.

A motion was made by Council Member Peat to continue this item to the next regular meeting to address any impact of the proposed building height on surrounding solar panels.

Council Member Marquez requested to amend the motion to address neighborhood parking concerns.

Council Member Peat declined the amendment.

Mayor Hertz-Mallari seconded the original motion.

The motion was unanimously carried by the following roll call vote:

AYES: 5 COUNCIL MEMBERS: Burke, Marquez, Peat, Minikus and Hertz-Mallari NOES: 0 COUNCIL MEMBERS: None
ABSENT: 0 COUNCIL MEMBERS: None

CONSENT CALENDAR
All matters listed on the Consent Calendar are to be approved with one motion unless a Council Member requests separate action on a specific item.

Council Member Marquez requested to pull Agenda Item No. 12.

A motion was made by Council Member Peat, and seconded by Council Member Burke, to approve Consent Calendar items No. 3 through 11 and 13 through 14.

The motion was unanimously carried by the following roll call vote:

AYES: 5 COUNCIL MEMBERS: Burke, Marquez, Peat, Minikus and Hertz-Mallari NOES: 0 COUNCIL MEMBERS: None
ABSENT: 0 COUNCIL MEMBERS: None
Item No. 3: Receive and File Public Comments Submitted for the April 10, 2023 City Council Meeting
Recommendation: Receive and file submitted public comments.

Item No. 4: Introduce and/or Adopt All Ordinances and Resolutions Presented for Consideration by Title Only and to Waive Further Reading Item No. 5: Approve Minutes – Meeting of March 20, 2023 and March 27, 2023 Recommendation: Approve as submitted.

Item No. 6: Accept the Arterial Rehabilitation, Project 316 Recommendation:

1. Accept the Arterial Rehabilitation, Project 316, in the amount of $1,738,259.02 and approve the final payment of $124,813.14 to Hardy and Harper, Inc.; and

2. Authorize the City Engineer to file a Notice of Completion with the County Recorder.

Item No 7: Adopt a Resolution approving the California State-Subdivision Agreements Regarding Distribution and Use of Settlement Funds with CVS, Allergan, Teva, Walmart and Walgreens
Recommendation: Adopt a Resolution approving the California State-Subdivision Agreements Regarding Distribution and Use of Settlement Funds with Teva, Allergan, CVS, Walgreens, and Walmart.

RESOLUTION NO. 6924

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CYPRESS

AUTHORIZING THE CITY OF CYPRESS TO ENTER INTO THE

SETTLEMENT AGREEMENTS WITH CVS, ALLERGAN, TEVA,

WALMART, AND WALGREENS, AGREE TO THE TERMS OF THE

RELATED STATE-SUBDIVISION AGREEMENTS, AND AUTHORIZE

ENTRY INTO THE RELATED STATE-SUBDIVISION AGREEMENTS

WITH THE ATTORNEY GENERAL
Item No. 8: Approve an Agreement for Property Management Services for 5121 Myra Avenue
Recommendation:

1. Approve an agreement with PMI Patron Management for property management services at 5121 Myra Avenue for an amount not to exceed $25,000; and

2. Authorize the City Manager to finalize and execute the agreement.

Item No. 9: Approve a Contract Amendment for Tree Maintenance Services Recommendation: Approve a $36,800 contract amendment to the agreement with Great Scott Tree Services, Inc. for on-call tree maintenance services.

Item No. 10: Second Reading of an Ordinance Amending the Municipal Code to Incorporate City Council Approved Changes to Agenda Structure Recommendation: Approve the second reading and adopt an Ordinance, by title only and waive further reading, amending Sections 2-1 and 2-2, and subsections thereunder, of the Municipal Code relating to the conduct of City Council meetings.

ORDINANCE NO. 1203

AN ORDINANCE OF THE CITY OF CYPRESS, CALIFORNIA
REPEALING AND REPLACING ORDINANCE NO. 1193 AND SECTIONS 2-1 AND 2-2 OF THE CYPRESS MUNICIPAL CODE RELATING TO THE

CONDUCT OF CITY COUNCIL MEETINGS
Item No. 11: Proclaim the Week of April 9-15, 2023 as National Public Safety Telecommunicators Week
Recommendation: Proclaim the week of April 9-15, 2023 as National Public Safety Telecommunicators Week.

Item No. 13: Receive and File the Single Audit Report for the Fiscal Year Ended June 30, 2022
Recommendation: Receive and File the Single Audit Report for the Fiscal Year Ended June 30, 2022
Item No. 14: Receive and File Register of Warrants, Transfers, and Wires Issued for the Period of March 11, 2023 through March 24, 2023 Recommendation: Receive and file the attached payment register summarized below for the period of March 11, 2023 through March 24, 2023:
• Electronic Funds Transfers 12806 through 12890
• Warrants 61950 through 62069
• Payroll Transfers W1498

END OF CONSENT CALENDAR
Regarding Item No. 12: Receive the Annual Solid Waste Franchise Consumer Price Index Rate Adjustment
Council Member Marquez commented on this item.

City Council discussion ensued.

A motion was made by Council Member Peat, and seconded by Mayor Pro Tem Minikus, to receive the annual solid waste franchise Consumer Price Index rate adjustment.

The motion was carried by the following roll call vote:

AYES: 4 COUNCIL MEMBERS: Burke, Peat, Minikus and Hertz-Mallari NOES: 1 COUNCIL MEMBERS: Marquez
ABSENT: 0 COUNCIL MEMBERS: None

NEW BUSINESS
Item No. 15: Approve Non-Profit Grant Awards for Fiscal Years 2023-24 and 2024- 25 Mayor Hertz-Mallari recused herself from this item due to her employment with one of the non-profit organization applicants.

The Director of Recreation and Community Services provided a report on this item.

City Council discussion ensued.

Council Members Peat and Burke disclosed their involvement with two of non-profit organization applicants and stated there is no conflict of interest.

A motion was made by Mayor Pro Tem Minikus, and seconded by Council Member Burke, to approve $1,466,660 for the non-profit grant request program for fiscal years 2023-24 and 2024-25.

The motion was carried by the following roll call vote:

AYES: 3 COUNCIL MEMBERS: Burke, Peat and Minikus
NOES: 1 COUNCIL MEMBERS: Marquez
ABSENT: 1 COUNCIL MEMBERS: Hertz-Mallari
Item No. 16: Approve Pandemic Recovery Plan Business Recovery and Support Programs
The Planning Director provided a report on this item.

Council Members discussion ensued.

A motion was made by Mayor Hertz-Mallari, and seconded by Council Member Peat, to approve the first phase of the Pandemic Recovery Plan’s Business Recovery and Support Programs; and appropriate $365,000 in the General Fund to fund the programs; and adopt a Resolution approving the donation of General Funds to eligible businesses; and authorize the City Manager to administer the programs, including entering into agreements, determining eligibility, approving applications, and dispersing funds.

The motion was carried by the following roll call vote:

AYES: 4 COUNCIL MEMBERS: Burke, Marquez, Peat and Hertz-Mallari NOES: 0 COUNCIL MEMBERS: None
ABSENT: 1 COUNCIL MEMBERS: Minikus
RESOLUTION NO. 6925

A RESOLUTION OF THE CITY COUNCIL OF THE

CITY OF CYPRESS FINDING THAT THE PUBLIC PURPOSE

WOULD BE SERVED BY THE DONATION OF FUNDS TO ASSIST

ELIGIBLE CITY OF CYPRESS BUSINESSES AND APPROVING

THE DONATIONS THERETO

ITEMS FROM CITY COUNCIL MEMBERS
Item No. 17: Discuss and Provide Direction Regarding City Council Consideration of Ordinance No. 1193 on April 24, 2023
City Manager provided a report on this item.

City Council discussion ensued.

A motion was made by Council Member Burke, and seconded by Council Member Peat, to confirm the portions of Ordinance No. 1193 that the City Council will discuss at its April 24, 2023 meeting and direct Council Members to provide all proposed changes to the portions of Ordinance No. 1193 to the City Manager no later than 9:00 AM on Monday, April 17, 2023.

The motion was carried by the following roll call vote:

AYES: 4 COUNCIL MEMBERS: Burke, Marquez, Peat and Hertz-Mallari NOES: 0 COUNCIL MEMBERS: None
ABSENT: 1 COUNCIL MEMBERS: Minikus

ORAL COMMUNICATIONS ON ITEMS NOT ON THE AGENDA
Wanda Youngsma, Cypress, spoke regarding conduct of Council Members.

Bob Youngsma, Cypress, spoke regarding conduct of Council Members.

Stephany Barragan, Cypress, spoke regarding grievance with Police department.

Ed Kraemer (via virtual participation), Cypress, spoke regarding Agenda Item No. 12 and signage at Lexington Park.

Katheryn Shapiro (via virtual participation), Cypress, spoke regarding Agenda Item No. 12, contracted services, and conduct of Council Members.

Helen Le (via virtual participation), Cypress, spoke regarding organics recycling and solid waste franchise amendment.

COUNCIL MEMBER REPORTS AND REMARKS
Council Member Marquez:

Attended the Strategic Planning Special Meeting. Attended the Commissioner Appreciation reception. Met with the City Attorney and Council Member Burke to discuss her claim filed against the City. Met with Commander Gibson from American Legion Post 295. Attended a Habitat for Humanity event honoring Supervisor Katrina Foley. Attended a Metropolitan Water District of Orange County meeting. Spoke with students at Western High School participating in the Western Independence Learning Center. Attended the Spring Egg Hunt. Met with a Cypress resident to discuss bike lanes. Congratulated the Cypress High School Baseball team on their recent win. Requested to agendize a discussion regarding transcribing Special City Council meetings and Workshops. Requested a report of investigations against Valley Vista Services be provided to the public.

Mayor Hertz-Mallari asked questions of Council Member Marquez regarding her visit to Western High School and state mandated anti-harassment training.

City Council discussion ensued.

Council Member Peat:

Attended the Strategic Planning Special Meeting. Attended the Commissioner Appreciation reception. Attended a social media overview meeting. Attended State Senator Janet Nguyen’s Meet and Greet event. Attended the Spring Egg Hunt.

Council Member Burke:

Attended the Commissioner Appreciation reception. Received a tour of Fire Station 17.

Attended the Spring Egg Hunt.

Mayor Pro Tem Minikus:

None.

Mayor Hertz-Mallari
Thanked Orange County Fire Authority for their work regarding an incident that occurred near the Senior Center. Thanked the Cypress Police Department for completing their investigation regarding the fatality accident that occurred on Walker Street and Orange Avenue. Attended the Spring Egg Hunt.

CITY MANAGER REMARKS
Stated an item will be added to the next meeting agenda regarding how to broadcast City Council meetings.

Council Member Marquez requested an item be added to the agenda to provide a presentation regarding Valley Vista Services self-reported commingling of refuse and recycling from Ovation at Flora Park.

City Council discussion ensued.

Council Member Peat and Mayor Hertz-Mallari objected to Council Member Marquez’s request.

The City Attorney clarified that, per the City Council’s policy for adding items to the agenda, a discussion item would appear on the next agenda for the City Council to discuss providing direction on Council Member Marquez’s request for a presentation regarding Valley Vista Services self-reported commingling of refuse and recycling from Ovation at Flora Park.

ADJOURNMENT – IN MEMORY OF CYPRESS RESIDENT ANDY LACHINA Mayor Hertz-Mallari adjourned the meeting at 10:11 p.m. to an adjourned Regular Meeting, to be held on Monday, April 24, 2023, beginning at 5:30 p.m. in the Executive Board Room. _______________________________

MAYOR OF THE CITY OF CYPRESS
ATTEST:
___________________________________

CITY CLERK OF THE CITY OF CYPRESS
CITY OF CYPRESS
CITY COUNCIL REPORT
City Council Regular 4.

FROM: Peter Grant, City Manager
DATE: 05/08/2023
SUBJECT: Receive and File Fiscal Year 2023-24 Proposed Budget and Capital Improvement Program

RECOMMENDATION

1. Receive and file the FY 2023-24 Proposed Budget and Capital Improvement Program;

2. Schedule City Council consideration for adoption of the FY 2023-24 Budget on June 12, 2023; and

3. Publish a notice stating the public may comment on the Budget at the meeting of June 12, 2023.

SUMMARY
Each May, the City Manager submits the Proposed Budget for the City and Recreation and Park District to the City Council. The first step in the Budget adoption process is a workshop which presents an overview of the City’s financial condition and the Proposed Budget. The workshop provides the City Council the opportunity to ask questions about the Proposed Budget and provide direction prior to considering Budget adoption in June.

DISCUSSION
The Proposed Budget is the culmination of approximately five months of work. Led by the Finance department, much effort is invested in estimating revenues, assessing the City’s financial outlook, and working with the departments to develop spending plans to deliver services to the community.

The FY 2023-24 Proposed Budget is balanced, maintains service levels, and incorporates the necessary funding for the first year of the Seven-Year Capital Improvement Plan. The Proposed Budget adheres to the City Council's Fiscal Strategies to ensure the City's fiscal health and advance the City Council's Strategic Plan.

Included with this report are:

The City Manager’s Budget Message
Decision Packages
The City of Cypress and Cypress Recreation and Park District Proposed Budget The City Manager’s Budget Message provides a narrative overview of the factors and considerations included in the Proposed Budget. The message highlights significant factors impacting FY 2023-24 and identifies longer-term challenges facing the City and District.

Decision Packages summarize significant changes in the Proposed Budget, including impacts from recommended changes. The City Council may approve, deny, change or add Decision Packages as long as the Budget remains balanced.

The City of Cypress and Recreation and Park District Proposed Budget provides an executive-level overview of each department at the division level and includes a Five-Year Forecast for the City's General Fund to assist in long-term planning. The Proposed Budget includes performance measures, FY 2022-23 accomplishments and FY 2023-24 objectives for each division. The Proposed Budget also includes extensive overview information, detailed capital project descriptions, and the Fiscal Strategies used in developing the Proposed Budget. This information provides a clear picture of how the City’s resources are being used to provide services to the community.

BUDGET IMPACT
None.

LEGAL REVIEW
None required.

APPROVED BY: Peter Grant, City Manager
Attachments
FY 2023-24 Budget Message
FY 2023-24 Decision Packages
FY 2023-24 Proposed Annual Budget
May 8, 2023
Honorable Mayor and Members of the City Council:

I am pleased to present the City of Cypress’ Fiscal Year (FY) 2023-24 Budget and Capital Improvement Program (CIP). It represents a prudent, practical spending plan consistent with Cypress’ legacy of conservative and award-winning financial management.

The City’s long-term financial position remains strong and continues to make productive use of additional General Fund resources from the $11.7 million American Rescue Plan Act windfall. Thanks to interest earnings, the FY 2023-24 Budget is balanced, but as the Five Year Forecast highlights, Cypress remains dogged by a modest, stubborn structural deficit that limits the City’s options to absorb cost increases or enhance service levels.

The projected structural deficit is a function of the City Council’s laudable $1.55 million annual contribution toward capital and infrastructure projects from General Fund operating revenues and unavoidable upward pressure on employee compensation caused by a tight labor market and inflation. The projected future deficits can likely be offset through the use of the Budget Stabilization Reserve, which was established to bridge small budget deficits that are anticipated to rectify through operational efficiencies and prior fiscal year end savings.

While the City has proficiently addressed small budget deficits for several years, Cypress must remain financially vigilant. In particular, City operations are heavily dependent on sales tax – a volatile revenue source that is not generated evenly throughout the business community. Cypress relies on a handful of businesses for the majority of its sales tax, which means a disruption to any of these major producers could jeopardize City operations. To mitigate the risk the City faces from its reliance on sales tax, the City Council updated its Fiscal Strategies during the FY 2022-23 Budget process with a new practice to guide sales tax estimating and budgeting.

The recent spike in interest earnings resulting from Federal efforts to contain inflation will require future budgets to consider a similar risk management strategy to manage investment revenues that can fluctuate greatly from one year to the next.

Our industry leading financial management practices are a justifiable source of community pride. Cypress is the only city to be recognized twice by former State Senator (and Certified Public Accountant) John Moorlach for having the strongest unrestricted net (fiscal) position of Orange County’s 34 cities. The City also continues to earn recognition from the Government Finance Officers Association for its Budget presentation and performance measurement program.

FY 2023-24 finds the City’s short-term financial condition healthy, but facing a variety of inflation-related challenges, the likelihood of more increases to the federal funds rate and the nation’s business economists’ consensus expectation that a U.S. recession will begin before the end of the calendar year.

Some of the challenges high inflation continues to present the City include:
 The cost to provide municipal services has increased. Everything from supplies, to gasoline, to service contracts costs significantly more than it did two years ago. In many cases, the Budget includes an inflation allowance, but costs can rise so quickly that these allowances may be insufficient or may be needed more broadly.  Capital project costs continue to go up. The City has had to adjust nearly every CIP project because of inflation and associated product, equipment and commodity shortages. Annual projects, like residential street resurfacing, have had their scope of work reduced compared to prior years. Fortunately, Cypress’ strong financial management practices have enabled the City to avoid higher borrowing costs by continuing to fund CIP projects on a pay-as-you-go basis.  The cost to retain and attract employees in a tight labor market has increased.

While some City revenues grow with inflation, overall revenue growth cannot keep pace with historically large Consumer Price Index increases, which also limits the City’s ability to preserve employee wages relative to the cost of living. As competition for employees becomes fiercer, the FY 2023-24 Budget includes recommendations to help retain employees and advance succession planning.

These investments are key to ensuring Cypress is served and protected by highly capable professionals who understand and are committed to our organization and are rooted in what makes this community so special.
 Employer pension costs are likely to increase as CalPERS navigates soaring interest rates, international crises, and rising employee wages. To ensure Cypress continues to manage its pension liabilities responsibly, the City Council established a Strategic Plan objective to consider options to further offset CalPERS unfunded pension plan actuarial liabilities.

While Cypress is exceedingly well prepared to weather a typical recession/business cycle, the risk of recession has been a consideration in the City’s FY 2022-23 decisions and is a risk around which the FY 2023-24 Budget is built.

BUDGET OVERVIEW
The combined Operating and Capital Budgets are $52.3 million, an increase of 12.4% from FY 2022-23, and are balanced.

The Operating Budget (all Funds) represents $40.7 million (78%) of the Budget, while capital improvement investments total $10.3 million (20%) and capital outlay makes up $1.3 million (2%) of expenditures.

The City is largely a service provider and over two-thirds of the Operating Budget are personnel costs, with the majority of that spending in the Police department.

Projected FY 2023-24 revenues are nearly $51 million, an increase of 13.7% from FY 2022-23. While General Fund revenues exceed operating expenditures, the use of accumulated reserves to support capital investments balances the Budget. Overall, the $1.3 million fund balance decline for all City funds is largely the result of the use of accumulated moneys (including one-time Pandemic Recovery Plan funds) for capital improvement program investments.

Key assumptions used to develop the Budget include:
 Reflects established City Council priorities and Fiscal Strategies  Sales Tax revenue grows modestly
 $691,700 of Pandemic Recovery Plan set-asides fund one-time projects  Current service levels are maintained
 CalPERS pension costs increase
 City Council established reserves are maintained
 $1.55 million of General Fund resources are contributed for current year capital projects
 Negotiated and anticipated employee salary and benefit increases are incorporated General Fund Overview
The General Fund, the City’s largest fund and the one over which the City Council has the most discretion, is balanced with a small projected decrease in total reserves.

Operating Capital
Budget Budget Total
Revenues $ 44.1 $ 6.9 $ 51.0
Expenditures (40.7) (11.6) (52.3)
Transfer for Capital (2.9) 2.9 -
Surplus/(Deficit) $ 0.5 $ (1.8) $ (1.3)
Budget Summary (Millions)
General Fund Revenues
FY 2023-24 General Fund revenues are projected to increase $3,472,985 (9.6%) from the prior year and do not include any tax increases.

Inflation impacts and the risk of recession make revenue projections difficult. Accordingly, the conservative, but realistic projections reflect the most up-to-date information available from the City’s Sales Tax consultant, Property Tax consultant, Cal Cities, the State Department of Finance, year-to-date receipts, and regional economic forecasts.

Cypress’ largest revenue source for the upcoming year, property tax ($13.0 million), is projected to increase $991,000 (8.3%) from the FY 2022-23 Budget. While Proposition 13 limits annual assessed value increases to protect homeowners, over time it has prevented property tax revenue from keeping pace with operating costs. However, the proposed increase for FY 2023-24 is unusually large and is a direct result of growth in assessed values due to recent changes in ownership and completed construction on multiple large-scale apartments and senior living projects, as well as the final dissolution of the Successor Agency to the former Redevelopment Agency.

Sales tax is a close second to property tax for largest revenue source ($12.6 million) and can be volatile, especially during periods of economic uncertainty. Sales tax receipts General Fund 2023-24 Budget Summary (Millions) Proposed
Revenues $ 39.7
Transfers In 1.0
Expenditures (37.6)
Capital Projects (2.1)
Transfers Out (1.1)
Decrease to Fund Balance $ (0.1)
2022-23 2022-23 2023-24 %
Adopted Estimated Proposed Change
Property Taxes $11,964,000 $12,624,671 $ 12,955,000 8.3% Sales Tax 12,405,000 12,505,000 12,605,000 1.6%
Transient Occupancy Tax 2,650,000 2,825,000 2,750,000 3.8% Franchise Tax 1,807,500 1,986,137 1,930,000 6.8%
Other Taxes 2,170,000 2,232,500 2,135,000 -1.6%
Investment Earnings 225,000 1,425,000 1,750,000 677.8%
Park District Reimb 2,453,312 2,203,270 2,655,010 8.2%
Other Service Charges 1,083,127 1,375,588 1,328,200 22.6% Licenses & Permits 883,070 1,152,800 1,012,330 14.6%
Other Revenues 624,848 842,383 618,302 -1.0%
Totals $36,265,857 $39,172,349 $ 39,738,842 9.6%
Revenue Category
remained stronger than expected during the pandemic, and more recently have benefitted from inflation and the high cost of gasoline. The most recent forecasts indicate modest sales tax growth in FY 2023-24. While any year over year growth is positive news, it remains imperative that City operations do not become overly reliant on sales tax as it is volatile and can decline rapidly from one year to the next. As such, the Fiscal Strategies were updated last year to limit sales tax revenues budgeted to support operations to a four-year average. Sales tax receipts projected to exceed the four-year average are dedicated for one-time expenditure. For FY 2023-24, the sales tax baseline is $12.5 million and the Budget allocates $120,000 to one-time purposes.

Investment earnings, which represents interest received on cash balances, have not been a major revenue source in the General Fund for well over a decade. However, actions by the Federal Reserve over the past year have resulted in unprecedented interest rate hikes. While these actions are generally viewed as economically risky with the potential for many negative short-term financial impacts to residents, local businesses and the City’s revenue base, higher interest paid on Treasury-backed securities generates significant additional revenues to the City. Over the last two years, interest rates on Treasury notes have gone from close to zero to well over four percent. As such, investment earnings in FY 2023-24 are expected to be more than $1.5 million higher than the prior budget. Simply put, additional investment earnings are responsible for the FY 2023-24 Budget being balanced without the use of reserves. As with sales tax revenue, it is essential that City services not rely on an unpredictable revenue like investment earnings.

It remains imperative we remain diligent stewards of the community’s resources and that we confront new financial challenges and work to diversify our revenue base and contain costs.

General Fund Expenditures
FY 2023-24 expenditures are $37.6 million, an increase of $2.1 million (6.0%) from FY 2022-23.

The personnel expenditure increases are due to many factors, the largest are the costs of the four-year labor agreement with the Cypress Police Officers’ Association the City Council approved in late 2022. Responding to industry-wide wage and recruitment pressures, the agreement significantly increased compensation to the Police 2022-23 2022-23 2023-24 %
Adopted Estimated Proposed Change
Personnel $23,312,663 $21,499,167 $ 24,478,999 5.0%
Maintenance & Operations 8,277,202 10,055,631 9,125,638 10.3% Internal Service Charges 3,859,320 3,859,320 3,977,980 3.1% Totals $35,449,185 $35,414,118 $ 37,582,617 6.0%
Expenditure Category
department’s 54 sworn Officers and Sergeants. Other personnel increases include higher CalPERS pension payments, one new position, two reclassifications, and negotiated/ anticipated compensation adjustments for non-sworn employees.

Maintenance and operation increases result from several factors, including Decision Packages. Decision Package are summarized in the following table.

Capital Improvement Program (CIP) Highlights
The CIP is the City’s long-term plan for investing in facilities and infrastructure. It is a key component of the Budget and of vital importance to the community. The CIP balances new projects, replacement of aged infrastructure, and life-extending maintenance.

Comprised of projects that often span multiple years and draw on many different funding sources, the FY 2023-24 CIP proposes to invest $10.3 million. The CIP also includes $29.6 million for Recreation and Park District projects.

One-Tme Ongoing
Cost (Savings) Cost (Savings)
ADM 1 City Rebranding General $ 50,000 $ -
ADM 2 Electronic Filing System for Fair Political
Practices Commission Filings
General 3,000 10,000
ADM 3 Office Assistant: City Clerk and Human
Resources
General - 85,000
FIN 1 Reclassification of an Accountant to
Accounting Supervisor
General - 22,000
FIN 2 Reclassification of Human Resources
Assistant to Human Resources Analyst
General - 24,000
PD 1 Police Department Community Academy General - 6,000 CD 1 Housing Element Implementation General 150,000 -
CD 2 Housing Element Monitoring and
Reporting
General - 50,000
Subtotal 203,000 197,000
REC-1 Reinvigorate the Cypress Run CRPD General - (31,800) Subtotal - (31,800)
Total All Funds 203,000 165,200
# Subject Fund
Fund Balances and Reserves
The Budget reflects the City Council’s policy of fully funding capital outlay replacements and employee benefit and self-insurance liabilities. All liabilities (with the exception of the CalPERS pension and retiree medical liabilities) are fully-funded and the Internal Service Funds have sufficient cash to pay all the required annual contributions for pensions and retiree medical costs. The City Council has established a Pension Trust to help offset unfunded CalPERS pension liabilities, with a portion of any General Fund budget surplus committed to additional trust investments.

Importantly, the Budget conforms to City Council policies requiring a 25% General Fund Contingency Reserve of $9.4 million and a 30% CIP Fund Cash-Flow Emergency Reserve of $11.3 million. Neither of these reserves is expected to be utilized in FY 2023-

24. CYPRESS RECREATION AND PARK DISTRICT
The Budget includes the Recreation and Park District (District), which is a distinct legal entity from the City although the City Council serves as the District’s Board of Directors.

The City supports the District through fee-based general management; finance; human resources; information technology; and maintenance services.

District Revenues
District revenues are budgeted at $8.6 million, an increase of $871,000 (11.2%) from FY 2022-23. The higher revenues are attributed to atypically large Property Tax growth and rising interest rates earned on cash balances which were both discussed previously in the overview of the City’s General Fund.

The District receives the majority of its recurring revenue (over 80%) from property tax, with fees for service (classes and facility rentals) historically being the one other major revenue source. The District’s dedicated property tax revenue remains a double-edged sword. It provides a stable income stream with which the District delivers a high level of 2023-24
Proposed
Street Projects $ 4,650,000
Traffic Signal/Lighting Projects 1,285,000
Storm Drain Projects 1,500,000
Sewer Projects 285,000
Parkway Projects 900,000
Public Facility Projects 1,700,000
Totals $10,320,000
Project Type
recreation services. However, under Proposition 13 property tax revenue growth tends to be less than both inflation and the longer-term growth rate of employee compensation due to pension costs and minimum wage increases. Fortunately, in times of economic uncertainty, property tax provides a reliable and steady cash flow and the District’s shortterm financial health is strong.

District Personnel costs represent more than 50% of operating costs when accounting for reimbursements to the City for maintenance services. With its primary revenue source not expected to keep pace with inflationary expenditure growth in the coming years, the District must continue to take measures to ensure its long-term fiscal sustainability. In addition to regularly updating fees, the District must optimize operations; leverage revenue generating assets; and add non-property tax revenues.

Strengthening its financial condition is particularly important as many of the District’s facilities are nearing major rehabilitation/replacement age and the District must identify funding for these necessary improvements. Current revenues are sufficient to pay for operations and some capital projects (including the annual repayment associated with the reconstruction of Arnold Cypress Park), but are insufficient to provide for other major rehabilitation costs related to the District’s aging facilities and infrastructure.

District Expenditures
The District Budget is $35.9 million, a more than three-fold increase ($27.8 million) from FY 2022-23, due to the large-scale capital projects proposed in FY 2023-24. Personnel costs increase 4.3%, reflecting the ongoing impact of minimum wage increases, higher pension costs and negotiated/anticipated salary increases, several newly-hired full-time employees moving through their respective salary ranges and additional Public Works engineers working on District capital projects.

Maintenance and operations expenditures have also increased as contract service costs reflect the wage impacts to City vendors caused by inflation, the tightening labor market, and higher material and equipment costs.
2022-23 2022-23 2023-24 %
Adopted Estimated Proposed Change
Property Taxes $ 6,218,000 $ 6,775,800 $ 6,772,000 8.9% Interest & Rents 371,100 756,521 857,210 131.0%
From Other Agencies 497,681 81,198 286,000 -42.5%
Services Charges 673,892 840,213 717,000 6.4%
Park Development Fees - 1,430,524 - n/a
Other Revenue - 2,446 - n/a
Totals $ 7,760,673 $ 9,886,702 $ 8,632,210 11.2%
Revenue Category
District Capital Improvement Projects
The FY 2023-24 Budget includes $27.5 million for the reconstruction of Arnold Cypress Park. This major project is funded by a loan from the City’s Infrastructure Fund and will be repaid by the District using additional annual property tax revenues. These additional property revenues are available due to the District recently paying off all outstanding loans to the City for District capital improvements funded by the former Redevelopment Agency which were disallowed by the State in 2012. While these revenues are sufficient to repay the City for the improvements to Arnold Cypress Park over the next two decades, the District’s need to identify funding for other significant capital investments remains a major challenge.

Future capital projects will be prioritized based on the facilities inventory and condition assessment and the availability of resources. The FY 2023-24 CIP projects are summarized and discussed in the FY 2023-24 Budget.

CONCLUSION
The FY 2023-24 Budget funds a strong municipal corporation and a remarkable team of employees serving Cypress. I am enormously proud of Team Cypress’ service to our community and have immense confidence in our ability to respond to challenges in FY 2023-24.

The City Council’s long-standing practice of strategically investing limited resources has Cypress well prepared for whatever lies over the horizon – assuming we continue our constrained approach to municipal operations and focus on core services.

The FY 2023-24 Budget embodies the City Council’s dedication to careful and transparent financial management. This commitment, which spans generations of Cypress City Councils, is the most important way we sustain the community’s success, political stability, skilled leadership, and partnership with our employees.

I would like to express my appreciation to our department Directors for their efforts to deliver quality services to our community and to support the City Council as it delivers on the City’s updated Mission Statement:
2022-23 2022-23 2023-24 %
Adopted Estimated Proposed Change
Personnel $ 2,392,584 $ 2,244,775 $ 2,495,190 4.3%
Maintenance & Operations 3,235,682 2,910,468 3,527,539 9.0% Internal Service Charges 287,530 287,530 306,290 6.5%
Capital Projects 2,215,000 3,881,508 29,560,000 1234.5% Capital Outlay 10,000 10,000 7,383 -26.2%
Totals $ 8,140,796 $ 9,334,281 $ 35,896,402 340.9%
Expenditure Category
Cypress is a safe and welcoming community delivering excellent services for our residents, neighborhoods, and businesses.

It is a tremendous honor to be Cypress’ City Manager and I look forward to continuing to serve our wonderful community from solid financial footing in FY 2023-24.

Peter Grant
City Manager
FY 2023-24 PROPOSED BUDGET

DECISION PACKAGES
The Budget Decision Packages proposed for FY 2023-24, summarized below, describe significant recommended Budget changes. The individual Decision Packages are attached and present a more detailed justification for each recommendation, and summarize their impacts. The City Council may approve, deny, change or add individual Decision Packages as long as the budget remains balanced.