Hilltop Park Center
Upper Activity Room
871 Jessie St. Monterey,
California
and Teleconference Location:
423 Dela Vina Avenue
Monterey, California
Monterey City Council
Special Meeting Agenda
Special Joint Meeting of the
Monterey City Council and
the Neighborhood and
Community Improvement
Program (NCIP) Committee
Thursday, July 18, 2024
7:00 PM – 10:00 PM
City Council
Tyller Williamson, Mayor
Kim Barber, Councilmember,
District 1
Gino Garcia, Councilmember
Alan Haffa, Councilmember
Ed Smith, Councilmember,
District 2
City Manager
Hans Uslar
NCIP Committee
Aguajito Oaks – A.J. Purdy
(Alt: Vacant)
Alta Mesa – Amy Stocker
(Alt: Holly Ochoa)
Casanova-Oak Knoll – Shelly
Schmidt
(Alt: Chelsea Lenowska)
Deer Flats – David Cohick
(Alt: David Overton)
Del Monte Beach – Jayme
Fields (Alt: Jeff White)
Del Monte Grove-Laguna
Grande – Scott Hanson
(Alt: Joseph Hill)
Downtown – Curt Tipton
(Alt: Bella Lofaso)
Fisherman Flats – Gary Baker
(Alt: Marilyn Maxner)
Glenwood – Lee Whitney
(Alt: Amanda Preece)
Monterey Vista – Hans
Jannasch (Alt: Vacant)
Naval Support – Both vacant
New Monterey – Chinyere
Ogbonna (Alt: Natalia Tjandra)
Oak Grove – Luz Adam
(Alt: Pat Erlinger)
Old Town – Susan Ricketson
(Alt: Rosemary Robert)
Presidio – Both vacant
Skyline – Dennis Duke
(Alt: John Mera)
Villa Del Monte – Jil Johnson
(Alt: Tammy Jennings)
HOW TO PARTICIPATE IN THIS MEETING:
Written comment: Members of the public may submit comment(s) to [email protected] until ½ hour before the start of the meeting. These messages are not read aloud during the meeting but are made available to the meeting body and public at https://monterey.gov/submitted-comments. All comments received become part of the record.
In-Person: Please see the meeting location listed above. Wearing a mask is recommended and encouraged.
Remote via ZoomGov Webinar:
o Join on a computer or smartphone: https://montereyorg.zoomgov.com/j/1616037682 An up-to-date version of the Zoom software must be used.
o Or join by telephone: Dial 833-568-8864 (Toll Free), 669-254-5252 (Campbell, CA) or 646-828-7666 (NY). If one number doesn’t work, please try another. Enter Webinar ID: 161 603 7682 #
If prompted to enter a participant ID, press #
To “raise your hand,” dial *9. Once called upon, dial *6 to unmute o Need help using or updating Zoom? Read our Zoom Meeting Instructions (PDF) This meeting will also stream live for viewing only on youtube.com/cityofmonterey (10 second delay) and on Comcast Channel 25 (up to 90-second delay).
PUBLIC COMMENT PROCEDURES AND TIME LIMITS:
The total amount of time allocated for public comment on a particular issue and for each individual speaker is generally as follows:
1. Up to three minutes per speaker.
7/18/2024 7:00:00 PM
2 2. For regular City Council meetings, there are two 15-minute public comment periods, one in the afternoon and one in the evening. Speakers may only comment during one session.
3. The total time allocated for public comment:
a. Items pulled from the consent agenda – 15 minutes each item b. Public Appearance items – 30 minutes each item
c. Public Hearing items – 30 minutes each item
d. Closed session items – 15 minutes each item
At the time an item is considered, the Mayor will ask those attending the meeting in person to line up at the podium or raise their hands, and for remote participants to use *9 on the telephone or the “raise hand” function in Zoom, if they wish to address the City Council. The maximum amount of time for each person to speak and the total amount of time allotted for each item will be determined based on the number of people indicating an interest in speaking and the amount of business to be conducted on the agenda. In exceptional circumstances and when necessary to ensure a full opportunity for public input, the Mayor may, with the legislative body’s consent, adjust the amount of time allowed for public input and/or the time allotted for each speaker.
CAMPAIGN CONTRIBUTION DISCLOSURE: Pursuant to the Levine Act (Govt. Code section 84308), any party to a permit, license, contract, or other entitlement before the Council is required to disclose on the record any contribution, including aggregated contributions, of more than $250 made by the party or the party's agents within the preceding 12 months to any City official. Participants and agents are requested to make this disclosure as well. The disclosure must include the name of the party, participant, or agent, and any other person making the contribution; the name of the recipient, the amount of the contribution, and the date the contribution was made.
TELECONFERENCE NOTICE
Pursuant to California Government Code Section 54953(b)(3), this meeting will include teleconference participation by NCIP Member Tammy Jennings from the remote location listed above, which shall be accessible to the public pursuant to California Government Code Section 54954.3.
CALL TO ORDER
PLEDGE OF ALLEGIANCE
PUBLIC APPEARANCE
Public Appearance items are on non-routine issues that might stimulate public interest and comments.
1. Overview of the Neighborhood and Community Improvement Program (NCIP), Current Status of the NCIP Program, Condition of City Infrastructure, and the NCIP Committee/City Council Relationship (Not a Project under CEQA per Article 20, Section 15378 and under General Rule Article 5, Section 15061)
ADJOURNMENT
Writings distributed for discussion or consideration on these matters within 72 hours prior to the meeting, pursuant to Government Code § 54957.5, are available at: monterey.gov/submitted-comments and in the City Manager’s Office at 580 Pacific St., Room 1, Monterey, CA 93940 during regular business hours.
Information distributed to the Council at the Council meeting becomes part of the public record. Members of the public who submit written public comment on an agenda item may be subject to the Levine Act which requires disclosure of campaign contributions of more than $250 to an officer of the City within the preceding 12 months.
7/18/2024 7:00:00 PM
3 CITY OF MONTEREY'S 24-HOUR SUGGESTION HOTLINES:
Voicemail: (831) 646-3799 Email: [email protected] Website: http://www.monterey.gov INTERPRETATION: The Monterey City Council invites and encourages public participation at its meetings. Requests for language interpretation may be made by contacting the City Clerk at [email protected] or 831-646-3935. The City Clerk will make every effort to accommodate requests for interpreter assistance. Requests should be made as soon as possible in advance of any meeting of the City Council. The City is committed to addressing language interpretation requests swiftly in order to maximize public participation.
ACCESSIBILITY: The City of Monterey is committed to including the disabled in all of its services, programs and activities. In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the City Clerk’s Office at [email protected] or (831) 646-3935. Notification 30 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting [28 CFR 35.102-35.104 ADA Title II]. Later requests will be accommodated to the extent feasible. For communication-related assistance, dial 711 to use the California Relay Service (CRS) to speak to City offices. CRS offers free text-to-speech, speech-to-speech, and Spanish-language services 24 hours a day, 7 days a week. If you require a hearing amplification device to attend a meeting, dial 711 to use CRS to talk to the City Clerk's Office at (831) 646-3935 to coordinate use of a device.
Upcoming city meetings are listed at http://isearchmonterey.org More information is available by calling (831) 646-3935 Council
Agenda Report
FROM: Andrea Renny, P.E., PTOE, Public Works Director
Prepared By: Reginald Paulding, P.E., Senior Engineer
SUBJECT: Overview of the Neighborhood and Community Improvement Program (NCIP), Current Status of the NCIP Program, Condition of City Infrastructure, and the NCIP Committee/City Council Relationship (Not a Project under CEQA per Article 20, Section 15378 and under General Rule Article 5, Section 15061) RECOMMENDATION:
That the City Council and Neighborhood and Community Improvement Program (NCIP) Committee receive a presentation on the overview of the NCIP, current status of the NCIP Program, condition of City infrastructure, and the NCIP Committee/City Council Relationship.
VALUE DRIVERS:
In collaboration with our community partners, work to improve the quality of life of all of our community members by fostering diversity, equity, and inclusion; championing equitable access to affordable housing; and maintaining a safe environment.
Serve as stewards of the City’s financial resources through sound economic vitality efforts, streamlining operations, reasonable revenue enhancements, visionary long-term planning, fiscal transparency, and community partnerships.
Foster a local government that is transparent and collaborative; and solicits, welcomes and appreciates input from all.
POLICY IMPLICATIONS:
This action is consistent with past Council practice to collaborate with and provide guidance to the NCIP Committee. Additionally, it is consistent with the City of Monterey Board, Commission and Committee Handbook, May 2012.
CAMPAIGN DISCLOSURE REQUIREMENT (LEVINE ACT) APPLIES: No.
FISCAL IMPLICATIONS:
There are no direct fiscal implications associated with providing a presentation to the City Council and the NCIP Committee.
City Council approved 44 NCIP projects in 2023 with an estimated value of $6.5 million. As of July 2024, there are 59 active NCIP projects with a budget of approximately $10.3 million with an additional $1,085,514 in available funding in the Ending Balance Account and $869,514 in the Contingency Balance Account. In June 2024, the NCIP Committee ranked 80 projects with Date: 7/18/2024
Item No.: 1.
Council Special Meeting, 7/18/2024, Item No. 1., Item Page 1, Packet Page 4 №10/24
an estimated cost of $22.4 Million. These projects will be coming to the City Council for approval and funding in Fall 2024.
The Neighborhood and Community Improvement Program will have approximately $12,234,575 available for project funding in Fiscal Year (FY) 2025 as shown in the table below.
Funding Sources/Accounts (Current Balances) Funds
Transient Occupancy Tax Revenue, FY24 $ 5,979,547
Prior Years Unappropriated NCIP Fund Balance $ 4,750,000 Ending Balance Account (31nunap) $ 1,085,514
Contingency Balance Account (31ncont) $ 869,514
Less Program Expenses $ (450,000)
NCIP Available Funding $ 12,234,575
Based on available funding, one potential Fiscal Year 2025 NCIP appropriation scenario is as follows:
Recommended Funding Funds
Staff Recommended Project Funding FY25 $ 11,000,000
NCIP Committee Recommended Contingency
Balance Account (June 6, 2024 Vote)
$ 1,200,000
Ending Balance Account (Remainder) $ 34,575
NCIP Available Funding $ 12,234,575
The NCIP Committee recommends an allocation of $330,486 from this year’s program budget into the NCIP Contingency Account (31ncont) to bring the Contingency Account balance from a current balance of $869,514 to $1,200,000.
ENVIRONMENTAL DETERMINATION:
The City of Monterey determined that the proposed action is not a project as defined by the California Environmental Quality Act (CEQA)(CCR, Title 14, Chapter 3 (“CEQA Guidelines), Article 20, Section 15378). In addition, CEQA Guidelines Section 15061 includes the general rule that CEQA applies only to activities which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. Because the proposed action and this matter have no potential to cause any effect on the environment, or because it falls within a category of activities excluded as projects pursuant to CEQA Guidelines section 15378, this matter is not a project. Because the matter does not cause a direct or any reasonably foreseeable indirect physical change on or in the environment, this matter is not a project. Any subsequent discretionary projects resulting from this action will be assessed for CEQA applicability.
ALTERNATIVES CONSIDERED:
The City Council and/or the NCIP Committee could choose not to move forward with the proposed discussion.
Council Special Meeting, 7/18/2024, Item No. 1., Item Page 2, Packet Page 5 №10/24
DISCUSSION:
The purpose of this joint City Council and NCIP Committee meeting is for Council and NCIP Committee to have an open discussion regarding City infrastructure needs, NCIP project status, and Council expectations with respect to NCIP.
The NCIP will receive approximately $10.3 million in funding in FY25, the largest amount of funding the program has received since its establishment in 1985. The NCIP is funded through the allocation of 16 percent of the money collected through hotel taxes (Transient Occupancy Tax).
Overview and History of the NCIP
Established in 1988, the Neighborhood Community Improvement Program (NCIP) directs tourist-generated dollars directly back into the City's residential neighborhoods. Under a Charter Amendment, at least 16 percent of the money collected through hotel taxes (Transient Occupancy Tax) is allocated to neighborhood and community improvements. Each fiscal year, a committee consisting of Monterey residents from each of the 15 City neighborhoods considers all nominated projects and makes a recommendation to City Council on which projects should be funded. A number of public meetings are held to discuss the nominated projects before projects are then voted on and ranked by the NCIP committee.
The NCIP program cycle begins early each year with meetings held throughout the spring and summer. Projects are not finally approved until Council has allocated funding to them, which normally occurs in late summer/early fall.
The City is extremely proud of this program and will continue to work hard to see to its continuing success.
In the general election of November 8, 1988, Measure B was approved by voters of the City.
This measure was an amendment to the Monterey City Charter to implement the NCIP.
Measure Y, a ballot measure to increase Transient Occupancy Tax from 10% to 12%, was approved by a wide majority of voters at the election held on November 3, 2020.
Currently, 16% of Transient Occupancy Tax is dedicated to the NCIP. Charter 6.6 converted 16% of what is otherwise a general tax that can be used for any lawful purposes such as funding infrastructure, public safety, etc., into a special tax, requiring a 2/3 approval to amend, that may be used only for the specific purposes set forth in the legislation.
Capital Improvement Program (CIP) Funding Challenges and Relationship to NCIP The purpose of the NCIP Program since its inception has been to direct tourist-generated dollars directly back into the City’s residential neighborhoods and to provide for capital projects of community-wide benefit. (Charter section 6.6.) Through the NCIP the City funds programs and projects that are ranked and recommended by residents.
Some community members have viewed NCIP funding as separate from the City’s funds, and that the rehabilitation or renovation of existing City facilities should be funded from the City’s General Fund or other sources, and not NCIP. To clarify, first, NCIP dollars are generated from the City’s Transient Occupancy Tax (TOT) collections and are, in fact, City funds. And secondly, it is financially infeasible for the rehabilitation of existing City facilities to be funded only from Council Special Meeting, 7/18/2024, Item No. 1., Item Page 3, Packet Page 6 №10/24
non-NCIP sources since there are not enough General Fund dollars to support City operations and the City’s aging infrastructure. Funding City services, such as staffing (police officers, firefighters, park workers, and other staff) and other operational costs, such as insurance, supplies, and materials, has increased drastically over the past several years. This means that there are insufficient General Fund dollars to fund the City’s infrastructure needs fully, and the City must rely on other sources. As shown in the graph below, the amount of NCIP available funding far exceeds General Fund CIP funding. This is because there is so little General Fund money available for CIP projects after operating costs, pension liabilities, insurance, debt payment, and other expenses are incurred.
*2020 and 2021 TOT revenues were down due to travel restrictions as a result of the COVID pandemic.
**2024 shows an additional $4.8 million in accumulation of unassigned fund balance from revenue collected prior to 2024.
Absent closing down existing City facilities because of a lack of funding to maintain them or cutting core services (neither of which staff recommends, and would be a disservice issue to the community), the City must continue to look at collaborating with the NCIP Committee to retrofit and repair existing aging infrastructure in our neighborhoods. There are countless examples of the NCIP Committee continuing to support projects that support City facilities as well as projects in the right of way that are of community-wide benefit.
The City Council, the City Council-appointed NCIP Committee Members, and City staff have a long history of collaboration and understanding the needs of our community. For example, in 2020, as a consequence of the economic devastation caused by the COVID-19 pandemic, the City Council reallocated over $10M of NCIP funding towards the operations of the City. Without that action, the City would have faced more severe layoffs and drastic service reductions. In 2022, the NCIP added a $1.2M Sports Center dehumidifier replacement project to their list. At that time, other funding sources were not available; however, at the budget midyear point in $0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
2006200720082009201020112012201320142015201620172018201920202021202220232024 NCIP CIP General Fund NCIP Unappropriated Fund Balance
Council Special Meeting, 7/18/2024, Item No. 1., Item Page 4, Packet Page 7 №10/24
FY23, funds were reallocated to NCIP using budget savings and unassigned fund balance.
These two examples show how well the City Council, NCIP Committee Members, and City Staff understand that NCIP funds support a variety of projects in our community and in our neighborhoods.
Project Impacts to Ongoing Operations and Maintenance (O&M) Costs and the City’s Operational Budget
Certain NCIP-recommended projects have ongoing annual O&M costs. NCIP projects bring great value to the community; however, after the initial NCIP funding for construction, the General Fund is responsible for funding of any related O&M. This exacerbates the City’s infrastructure funding conundrum: limited funds are available outside of NCIP for necessary facility rehabilitation, and new NCIP projects that need to be repaired or replaced over time also rely on the limited non-NCIP funds. Staff estimates the total costs of O&M for NCIP completed projects exceed $2 million each year. For example, O&M expenses include water and electrical charges for new shower stations, water fountains, and streetlights. The repair costs for items such as the Del Monte Beach Boardwalk or radar speed signs are other examples. As beneficial as these projects are to the community, these ongoing O&M expenses are not budgeted for future year expenses, increasing the City’s long-term financial obligations and limiting the City’s ability to plan and budget for the City’s capital needs over time.
To provide additional perspective to the discussion on the needs the City is facing, staff have been working on a needs assessment of our critical infrastructure as well as City-owned facilities. In May 2024, staff estimated that the City has an estimated need for upgrades to facilities, parks, and right-of-way to comply with the Americans With Disabilities Act (ADA) at a cost of approximately $42 Million. Public Works has also estimated that existing needs for rightof-way improvements, parking facilities, harbor facilities, and City buildings totals over $265 million.
There is a substantial gap between projected infrastructure needs and funding. Every city and county is facing rising expenses for the operation, maintenance, and rehabilitation of infrastructure. Insufficient investment over the years has led to a growing backlog of projects, hindering the overall functionality and safety of essential infrastructure.
Kicking the Can Down the Road: An Unsustainable Path
Currently, the City of Monterey lacks the necessary funding within its current tax and revenue framework to adequately maintain its infrastructure assets. The repercussions of this infrastructure deficit are far-reaching, affecting public safety, community services, and the overall quality of life for our community. The City continues to invest in programs and services by funding staff who deliver these services. However, staff and the community rely on buildings that are adequately maintained in order to deliver services effectively. The City has rightfully maintained core services and funded personnel in police, fire, recreation, libraries, and public works, and should continue to do so. However, the City has historically “kicked the can down the road” by funding “new and shiny” projects while inadequately funding the maintenance or retrofit of neglected facilities such as community centers, fire stations, the police station, and library where our personnel work and services are provided to the community.
Despite the daunting nature of this funding gap, City Staff is striving for transparency and emphasizing that the challenge should not be deferred to future generations of councilmembers and staff. This approach reflects a sense of responsibility toward ensuring the sustainability and Council Special Meeting, 7/18/2024, Item No. 1., Item Page 5, Packet Page 8 №10/24
resilience of the City's infrastructure, recognizing that delayed action could exacerbate the existing issues and lead to more significant challenges in the future. Neglected infrastructure does not only result in additional maintenance costs over time, but it also has a serious impact on the ability of the City to recruit and retain talented employees who do not want to work in dilapidated facilities or community members who do not want to participate in programs held in poorly maintained facilities.
Special sales tax measures Measure P and S have been critical to the repairs of our streets, storm drains and installation of curb ramps. However, these funds can only be used to address specific projects. It is clear we have a significant challenge to adequately fund our infrastructure, including City-owned buildings.
As presented at the Special Council Meeting on May 29, 2024, Public Works personnel and other City staff have identified approximately $96 million in projects to address maintenance, repairs, and infrastructure needs within the next 5 years. The funding needed to address critical infrastructure repairs in the next 20 years exceeds $288 million. These numbers will be refined over the next year as we finalize current assessments of the wharves, City facilities and garages. The available funding amount identified by the City Finance Budget team for the Capital Improvement Program (General Fund) totals $2.5 million for FY 2024/25, and $2.5 million per year for the subsequent four years (FY25-29). At this funding level, the Five-Year Capital Improvement Program will only include projects that represent the most critical needs, with a total funding amount of $12.5 million from General Fund.
Approximately 2% of the General Fund ($2.5 million) is allocated to CIP projects, compared to Pacific Grove at 18%, Salinas at 17%, and San Luis Obispo at 25% of their General Fund allocated to CIP projects. Moreover, many cities in California reinvest more than 25% of their General Fund into their existing infrastructure annually through their CIPs.
Striking a balance between the needs and interests of the residents and the financial capacity of the City is a challenging process. Foregoing or deferring capital improvements is often a response to limited resources and constrained financial times. The City can no longer continue to defer critical maintenance and must prioritize the highest need infrastructure projects or risk these assets deteriorating beyond repair. Because of the limited amount of General Funds available for the CIP, efforts continue to identify additional funding through Federal and State resources, as well as the continued evaluation of effective and efficient use of the limited resources available to the City. Staff continue seeking alternative funding opportunities and approaches to address the funding gaps.
Delayed maintenance often leads to more extensive and expensive repairs in the future, exacerbating budgetary pressures. The proposed General Fund allocation to the CIP does not provide sufficient funding to address all the critical capital needs of City-owned buildings and other infrastructure. It is important to note that capital project costs continue to increase due to Federal and State mandates, including ADA and storm water regulations, as well as inflation.
City Council/NCIP Committee Relationship
At the joint City Council/NCIP Committee meeting on July 18, 2024, the City Council will facilitate a dialogue about the City Council/NCIP Committee relationship.
Council Special Meeting, 7/18/2024, Item No. 1., Item Page 6, Packet Page 9 №10/24
The Monterey City Council, NCIP Committee, and staff look forward to a productive conversation and discussion on July 18, 2024 about the items and topics covered in this staff report and the presentation that will be provided.
AR/rp
Writings distributed for discussion or consideration on this matter within 72 hours prior to the meeting, pursuant to Government Code § 54957.5, will be made available at the following link:
https://monterey.org/Submitted-Comments
Council Special Meeting, 7/18/2024, Item No. 1., Item Page 7, Packet Page 10