CITY COUNCIL OF MONTEREY PARK
THE CITY COUNCIL ACTING ON BEHALF OF THE SUCCESSOR AGENCY OF THE FORMER
REDEVELOPMENT AGENCY, THE HOUSING AUTHORITY, THE MONTEREY PARK FINANCING
AUTHORITY AND THE MONTEREY PARK GEOLOGIC HAZARD ABATEMENT DISTRICT AGENDA
REGULAR CITY COUNCIL MEETING
MONTEREY PARK CITY HALL COUNCIL CHAMBERS
320 W. NEWMARK AVENUE, MONTEREY PARK, CA 91754
Wednesday
November 15, 2023
6:30 p.m.
GENERAL INFORMATION
Documents related to an Agenda item are available to the public in the City Clerk’s Office located at 320 West Newmark Avenue, Monterey Park, CA 91754, during normal business hours and the City’s website at http://www.montereypark.ca.gov/AgendaCenter/City-Council-17.
The public may watch the meeting live on the city’s cable channel MPKTV (AT&T U -verse, channel 99 or Charter Communications, channel 182) or by visiting the city’s website at http://www.montereypark.ca.gov/133/City-Council-Meeting-Videos.P er the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please call City Hall at (626) 307- 1359 for reasonable accommodation at least 24 hours before a meeting. Council Chambers are wheelchair accessible.
PUBLIC PARTICIPATION
You may speak up to 5 minutes on Agenda item. You may combine up to 2 minutes of time with another person’s speaking. No person may speak more than a total of 10 minutes. The Mayor and City Council may change the amount of time allowed for speakers. Written Communication will be accepted up to 24 hours before the meeting via email to [email protected].
While all comments are welcome, the Brown Act does not allow the City Council to take action on any item not on the agenda. The Council may briefly respond to comments after Public Communications is closed. Persons may, in addition to any other matter within the City Council's subject-matter jurisdiction, comment on Agenda Items at this time. If you provide public comment on a specific Agenda item at this time, however, you cannot later provide comments at the time the Agenda Item is considered.
MISSION STATEMENT
The mission of the City of Monterey Park is to provide excellent services to enhance the quality of life for our entire community.
LAND ACKNOWLEDGMENT
We would like to acknowledge that the land we inhabit today was once known as Tovangaar, the home of the Gabrieleño- Tongva people. We show our respect to the Gabrieleño-Tongva people, as well as all Indigenous people, past, present, and future, and honor t heir labor as original caretakers of this land. We commit to uplifting the Gabrieleño-Tongva people, invite you to acknowledge the history, and join us in caring for this land.
Monterey Park City Council Agenda, November 15, 2023 - Page 2
CALL TO ORDER Mayor
FLAG SALUTE The Monterey Park Police Explores
ROLL CALL Henry Lo, Vinh Ngo, Jose Sanchez, Thomas Wong, Yvonne Yiu
AGENDA ADDITIONS, DELETIONS, CHANGES AND ADOPTIONS
PUBLIC COMMUNICATIONS
STAFF COMMUNICATIONS:
• Fire Department
• P olice Department
[1.] PRESENTATION
1-A. MONTEREY PARK COMMUNITY HEALING FUND UPDATES
[2.] OLD BUSINESS
2-A. AUTHORIZATION TO ISSUE LEGISLATIVE SUBPOENAS REGARDING THE POTENTIAL REVOCATION OF CONDITIONAL USE PERMIT NO. CU- 89-004 (AS AMENDED AND MODIFIED) HELD BY ATLANTIC SQUARE, LLC (CONTINUED FROM NOVEMBER 1, 2023) It is recommended that the City Council consider:
(1) Adopting a Resolution authorizing the Mayor and City Clerk to issue legislative subpoenas for testimony and records related to the potential revocation of CUP No. CU -89-004 (as amended) that was originally approved via Resolution No. 9356, adopted August 29, 1989 (and subsequently modified/amended); and
(2) Taking such additional, related, action that may be desirable.
[3.] CONSENT CALENDAR ITEM NOS. 3A-3L
All items under the Consent Calendar are considered by the City Council to be routine and will be enacted by one motion. Specific items may be removed from the Consent Calendar at the request of any member of the City Council for separate consideration.
3-A. MINUTES
It is recommended that the City Council consider:
(1) Approving the minutes from the regular meeting of September 6, 2023 and the special meetings of September 6, 2023 and September 26, 2023; and (2) Taking such additional, related, action that may be desirable.
3-B. AMENDING RECORDS RETENTION SCHEDULE
It is recommended that the City Council consider:
(1) Adopting a Resolution amending the City's Records Retention Schedule for City documents; or
(2) Taking such additional, related, action that may be desirable.
Monterey Park City Council Agenda, November 15, 2023 - Page 3
3-C. MONTHLY INVESTMENT REPORT – OCTOBER 2023
It is recommended that the City Council consider:
(1) Receiving and filing the monthly investment report; and (2) Taking such additional, related, action that may be desirable.
3-D. RESOLUTION ADOPTING THE RECOGNIZED OBLIGATION PAYMENT SCHEDULE AND ADMINISTRATIVE BUDGET FOR JULY 1, 2024 – JUNE 30, 2025
It is recommended that the City Council consider:
(1) Adopting a resolution approving the Recognized Obligation Payment Schedule (ROPS 24- 25 A&B) for the period between July 1, 2024 – June 30, 2025; and (2) Approving the Successor Agency Administrative Budget for July 1, 2024 – June 30, 2025; (3) Directing staff to post and transmit the ROPS and Administrative Budget to the appropriate public agencies; and
(4) Taking such additional, related, action that may be desirable.
3-E. CONSIDERATION OF ADOPTION OF A RESOLUTION TO AUTHORIZE OPEN MARKET
BOND REPURCHASE OF A PORTION OF THE CITY OF MONTEREY PARK OUTSTANDING TAXABLE PENSION OBLIGATION BONDS, SERIES 2021
It is recommended that the City Council consider:
(1) Adopting a Resolution of the City Council of the City of Monterey Park:
a. authorizing the Open Market Bond Repurchase of a Portion of its Outstanding Taxable Pension Obligation Bonds, Series 2021;
b. approving a Repurchase Agent and authorizing the City Manager to execute an agreement, in a form approved by the City Attorney, with Samuel A. Ramirez & Co., Inc.; and
c. authorizing certain additional actions in connection therewith. (2) Taking such additional, related, action that may be desirable.
3-F. CONSIDERATION OF ADOPTION OF A RESOLUTION DIRECTING THE INTERIM CITY
MANAGER TO TAKE ACTIONS NECESSARY TO FINANCE WATER FACILITIES AND
IMPROVEMENTS TO THE WATER SYSTEM
It is recommended that the City Council consider:
(1) Adopting Resolution No. _______ directing the Interim City Manager to take actions necessary to finance water facilities and improvements to the Water System; and (2) Taking such additional, related, action that may be desirable.
3-G. APPROVE REVISED FY2023 -2024 CITY OF MONTEREY PARK COMPREHENSIVE
SALARY SCHEDULE
It is recommended that the City Council consider:
(1) Approve a revised City of Monterey Park Comprehensive Salary Schedule; and (2) Taking such additional, related, action that may be desirable.
Monterey Park City Council Agenda, November 15, 2023 - Page 4
3-H. SAN GABRIEL VALLEY MUNICIPAL WATER DISTRICT OPPORTUNITY FOR WATER LEADERSHIP (OWL) GRANT FISCAL YEAR 2023/24
It is recommended that the City Council consider:
(1) Accepting $3,000 in San Gabriel Valley Municipal Water District grant funding to purchase items for the Library collection and host a family-friendly event; and (2) Augmenting the FY 2023-2024 to allocate the $3,000 in grant funds; and (3) Taking such additional, related, action that may be desirable.
3-I. AUTHORIZE THE INTERIM CITY MANAGER TO EXTEND THE LICENSE AGREEMENT
WITH CHINATOWN SERVICE CENTER FOR USE OF THE SIERRA VISTA COMMUNITY
CENTER AS THE TEMPORARY SITE OF THE MPK HOPE RESILIENCY CENTER It is recommended that the City Council consider:
(1) Authorizing the Interim City Manager, or designee, to extend the license agreement, in a form approved by the City Attorney with Chinatown Service Center for use of the Sierra Vista Community Center as the temporary MPK Hope Resiliency Center; and (2) Taking such additional, related, action that may be desirable.
3-J. AUTHORIZE THE INTERIM CITY MANAGER TO EXECUTE A LICENSE AGREEMENT WITH
CARNIVAL MIDWAY ATTRACTIONS TO PROVIDE AMUSEMENT RIDES, GAMES, AND
CONCESSIONS AT THE ANNUAL HAPPY BIRTHDAY MONTEREY PARK, PLAY DAYS
CARNIVAL
It is recommended that the City Council consider:
(1) Authorizing the Interim City Manager, or designee, to execute a license agreement, in a form approved by the City Attorney with Carnival Midway Attractions to provide amusement rides, games, and concessions at the annual Happy Birthday Monterey Park, Play Days Carnival; and
(2) Taking such additional, related, action that may be desirable.
3-K. CONSIDERATION AND APPROVAL OF AN INTERAGENCY MEMORANDUM OF
UNDERSTANDING BETWEEN THE CITY OF MONTEREY PARK AND THE LOS ANGELES
COUNTY METROPOLITAN TRANSPORTATION AUTHORITY AS THE ADMINISTRATOR
OF THE REGIONAL INTEGRATION OF INTELLIGENT TRANSPORTATION SYSTEMS It is recommended that the City Council consider:
(1) Authorizing the Interim City Manager to execute a Memorandum of Understanding (MOU) with the Los Angeles County Metropolitan Transportation Authority (LACMTA), in a form approved by the City Attorney, for the Regional Integration of Intelligent Transportation System (RIITS); and
(2) Taking such additional, related, action that may be desirable.
CEQA (California Environmental Quality Act):
The proposed action is exempt from the requirements of the California Environmental Quality Act (Pub. Res. Code §§ 21000, et seq.: “CEQA”) and CEQA Guidelines (Cal. Code Regs. Title 14, §§ 15000, et, seq.) in accordance with CEQA Guidelines § 15305 (Class 5 – Minor Alterations in Land Use Limitations). The project involves a negligible expansion of use; there is only a minor change in the operation of an existing use. The project would not result in significant effects related to traffic, noise, air quality, or water quality and it can be adequately served by all required utilities and public services.
Monterey Park City Council Agenda, November 15, 2023 - Page 5
3-L. 2023 RESIDENTIAL STREET REHABILITATION – AWARD OF PUBLIC WORKS
CONTRACT TO ALL AMERICAN ASPHALT
It is recommended that the City Council consider:
(1) Authorizing the Interim City Manager to execute a public works contract, in a form approved by the City Attorney, with All American Asphalt in the contract amount of $1,200,000 for the 2023 Residential Street Rehabilitation Project; and (2) Authorizing the Director of Public Works to approve change orders and contingency up to $180,000, or 15% of the contract amount; and
(3) Taking such additional, related, action that may be desirable.
CEQA (California Environmental Quality Act):
It is recommended that the City Council find that the proposed work is exempt from additional environmental review under the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines (14 Cal. Code of Regs. § 15000, et seq.) § 15301(c) (Existing Facilities) which exempts the operation, repair, maintenance, alteration of existing public or private structures which involve negligible or no expansion of existing or former use. Subsection (c) of Section 15301 notes that repair of existing highways and streets, sidewalks, gutters, and bicycle and pedestrian trails —like the proposed work —are exempt from CEQA if additional automobile lanes are not created.
[4.] PUBLIC HEARING
4-A. PUBLIC HEARING TO APPROVE THE 2023 ANNUAL REPORT AND THE LEVY OF ASSESSMENTS FOR DOWNTOWN BUSINESS IMPROVEMENT DISTRICT NO. 1 FOR PROGRAM YEAR 2024.
It is recommended that the City Council consider:
(1) Opening the public hearing, receiving both written and oral comments, and closing the public hearing; and
(2) Adopting the resolution confirming the 2023 Annual Report and the levy of assessments for Business Improvement District No. 1 for program year 2024; and (3) Taking such additional, related, action that may be desirable.
[5.] NEW BUSINESS
5-A. PROVIDE AN UPDATE AND RECOMMENDATIONS REGARDING THE MONTEREY PARK
REWARDS PROGRAM
It is recommended that the City Council consider:
(1) Discussing several options regarding the continued use of a shop local rewards program; and
(2) If desirable, providing additional staff direction; and (3) Taking such additional, related, action that may be desirable.
Monterey Park City Council Agenda, November 15, 2023 - Page 6
5-B. AN ORDINANCE AMENDING THE MONTEREY PARK MUNICIPAL CODE (“MPMC”)
REGULATING PERMIT PARKING
It is recommended that the City Council consider:
(1) Introducing and waiving first reading of an Ordinance adding Chapter 10.68 to the Monterey Park Municipal Code (“MPMC”) regulating preferential parking permit districts; and
(2) Scheduling a second reading and adoption for December 6, 2023; and (3) Taking such additional, related, action that may be desirable.
CEQA (California Environmental Quality Act):
The City reviewed the environmental impacts of the Project under the California Environmental Quality Act (Public Resources Code §§ 21000, et seq. “CEQA”) and the regulations promulgated thereunder (14 Cal. Code of Regs. §§ 15000, et seq., the “CEQA Guidelines”). CEQA Guidelines §§ 15060(c)(2), 15061(b)(3), and 15378 exempt activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment, activities where there is possibility that it may have a significant effect on the environment, and activities that do not constitute a “project” as defined, respectively. T his Ordinance is for general policies and procedure-making. Any request for preferential parking districts pursuant to this ordinance will be evaluated separately under the CEQA Guidelines. Accordingly, this Ordinance is exempt from further review.
[6.] CITY COMMUNICATIONS (CITY COUNCIL)
6-A. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MONTEREY PARK, CALIFORNIA, DECLARING THE MONTH OF NOVEMBER 2023 FAMILY COURT AWARENESS MONTH (Requested by Mayor Sanchez)
It is recommended that the City Council consider:
(1) Adopting a Resolution declaring the month of November 2023 Family Court Awareness Month; and
(2) Taking such additional, related, action that may be desirable.
6-B. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MONTEREY PARK, CALIFORNIA, DECLARING THE MONTH OF NOVEMBER 2023 NATIONAL HOMELESS YOUTH AWARENESS MONTH (Requested by Mayor Sanchez)
It is recommended that the City Council consider:
(1) Adopting a Resolution declaring the month of November 2023 National Homeless Youth Awareness Month; and
(2) Taking such additional, related, action that may be desirable.
[7.] FUTURE AGENDA ITEMS
[8.] CLOSED SESSION (IF REQUIRED; CITY ATTORNEY TO ANNOUNCE)
ADJOURN
City Council Staff Report
DATE: November 15, 2023
AGENDA ITEM NO:
TO: The Honorable Mayor and City Council
FROM: Karl H. Berger, City Attorney
SUBJECT: Authorization to issue Legislative Subpoenas regarding the potential revocation of Conditional Use Permit No. CU-89-004 (as amended and modified) held by Atlantic Square, LLC (Continued from November 1, 2023).
RECOMMENDATION:
It is recommended that the City Council consider:
1. Adopting a Resolution authorizing the Mayor and City Clerk to issue legislative subpoenas for testimony and records related to the potential revocation of CUP No. CU-89-004 (as amended) that was originally approved via Resolution No. 9356, adopted August 29, 1989 (and subsequently modified/amended); and
2. Take such additional, related action that may be desirable.
EXECUTIVE SUMMARY
On November 1, 2023, the City Council considered whether to issue legislative subpoenas to gather information to determine whether the City should consider taking action to revoke CUP No. CU-89-004 which, as amended and modified, regulates land uses at 2000-2290 South Atlantic Boulevard. A copy of the staff report for that item is attached as Exhibit “1” (in its entirety).
After discussion, the City Council postponed the matter to this meeting. In doing so, the Council invited the property owner to contact the City Attorney with a plan to file an application to revitalize the South Atlantic Boulevard. At the time this Agenda was posted, the City Attorney’s office was not provided with any plan from the property owner.
Instead, the property owner’s attorneys contacted the Assistant City Attorney with the attached email correspondence dated November 3, 2023 (Exhibit 2). The correspondence speaks for itself and appears to contradict written (see Exhibit 3) and verbal public comment provided during the November 1st meeting – regarding cooperation and good will – and certainly demonstrates the property owner’s intent to ignore the City Council’s invitation during that meeting. The Assistant City Attorney’s response is also included as part of Exhibit 2.
Old Business - 2A
Staff Report
November 15, 2023
Based upon the property owner’s apparent unwillingness to accept the City Council’s invitation and submit meaningful information to the City, the recommendation from November 1st is renewed, i.e., to issue legislative subpoenas in accordance with the draft resolution attached to the November 1 st staff report (Exhibit 1). In addition to obtaining documents, the legislative subpoena would also require the deposition testimony of Chief Executive Officer Tim Pettit, Chief Operations Officer Tom Kuehl (who spoke on November 1st), and Mr. Byron de Arakal (who spoke before the closed session held at 5:30 p.m. on November 1st).
As to Mr. Arakal, we will be interested in deposing him about the statements made in his written comments from November 1 st including, without limitation, an explanation regarding how the City’s actions are “unnecessarily hostile” (in light of the City defending itself against two lawsuits filed by the property owner); what “exciting redevelopment plans” are being proposed – since there is no pending application for any such plans; and, along those lines, what “formula for success” might be proposed by the property owner since, again, no application is on file with the City.
Respectfully submitted and prepared by:
_____________________________
Karl H. Berger, City Attorney
Reviewed by:
_____________________________
Inez Alvarez, Interim City Manager
ATTACHMENTS
1. November 1, 2023 Staff Report and exhibits – including proposed Resolution.
2. Email correspondence from October 24
th, October 30th, November 3rd, and
November 4th.
3. Written public comment from November 1, 2023 submitted by Mr. Byron de Arakal.
Staff Report
November 15, 2023
ATTACHMENT 1
November 1, 2023 Staff Report
City Council Staff Report
DATE: November 1, 2023
AGENDA ITEM NO:
TO: The Honorable Mayor and City Council
FROM: Karl H. Berger, City Attorney
SUBJECT: Authorization to issue Legislative Subpoenas regarding the potential revocation of Conditional Use Permit No. CU-89-004 (as amended and modified) held by Atlantic Square, LLC.
RECOMMENDATION:
It is recommended that the City Council consider:
1. Adopting a Resolution authorizing the Mayor and City Clerk to issue legislative subpoenas for testimony and records related to the potential revocation of CUP No. CU-89-004 (as amended) that was originally approved via Resolution No. 9356, adopted August 29, 1989 (and subsequently modified/amended); and
2. Take such additional, related action that may be desirable.
EXECUTIVE SUMMARY
On May 4, 2022, the City Council adopted Resolution No. 2022-R28 to establish procedures for issuing legislative subpoenas in accordance with California law.
Legislative subpoenas to investigate matters being considered by the City Council.
During the past several years, it is apparent that property located at 2000-2290 South Atlantic Boulevard, generally known as the “Atlantic Square” property, is generally in a state of vacancy and disrepair. In addition to that condition likely constituting a public nuisance under Monterey Park Municipal Code (“MPMC”) Chapter 4.30, the failure to exercise the land use approvals granted via CUP No. CU-89-004 (as subsequently modified and amended; collectively, the “ATS CUP”) make it apparent that the City Council may wish to review and potentially revoke such land use entitlements.
To better understand why the Atlantic Square property is currently vacant, the City Attorney recommends that the City Council adopt a Resolution authorizing the Mayor and City Clerk to issue legislative subpoenas to various persons and corporations responsible for implementing the ATS CUP. Evidence gathered from such investigation will be presented to the City Council for consideration and potential action.
New Business - 5A
Staff Report
November 1, 2023
BACKGROUND
Relevant to this Agenda Item is the ATS CUP that the City Council approved via Resolution No. 9356 adopted on August 29, 1989 . Among other things, the ATS CUP allows Atlantic Square to operate (1) a commercial shopping facility of five or more units; (2) two drive-in restaurants; (3) one additional on-sale alcohol use; and (4) major site identification signs. The ATS CUP was modified and amended in subsequent years to allow additional uses.
Since at least 2020, however, many storefronts at Atlantic Square remain vacant . Such vacancies undermine the public purpose for the former Monterey Park Redevelopment Agency (“MPRDA”) acquiring the property in the early 1980s. Rather than eliminating blight, the vacant storefronts are instead contributing to public nuisances (see generally, MPMC § 4.30.030, and specifically, §§ 4.30.050(a, c, d, e, g(3, 4, 5), x, and ii) ). Indeed, the very findings for the ATS CUP appear to be undermined:
“the shopping center will be a substantial improvement over the existing one located in the center. Parking configuration shall be improved for better internal circulation. Additional landscaping will be provided and upgrading of all building facades will occur. Tenants needed by the City will be located here so as to provide necessary products to the citizens and needed sales tax to provide for City services.”
1 While the property owner’s representatives ( Terramar Retail Center or “TRC”) made multiple public assertions regarding why Atlantic Square is failing to take its obligations seriously, the City lacks substantial evidence to verify such statements.
MPMC § 21.32.150 establishes procedures for revoking or suspending conditional use permits; a copy is attached for reference. As may be read, “[u]pon recommendation by … the City Council … the body which granted a … conditional use permit may conduct a noticed public hearing to determine whether it should be revoked.” Any such potential action must be based upon substantial evidence.
To determine whether there is sufficient evidence to consider revocation of the ATS CUP requires additional evidence . To gather such evidence, the City may issue legislative subpoenas in accordance with Government Code §§ 37104-37109 and Resolution No. 2022-R28. Once authorized, such subpoenas are signed by the Mayor and issued by the City Clerk. They may be enforced by the Superior Court.
1 ATS CUP, p.2, Section 2(4); emphasis added.
Staff Report
November 1, 2023
The ability for cities to issue legislative subpoenas is well-established and was upheld by the California Supreme Court.2 They may be utilized to gather testimony and documents that are relevant to any actions or matters considered by a city. Here, that means anything related to the failure to utilize the land uses authorized by the ATS CUP including, without limitation, the information TRC submitted to the City during the past 24 months.
If adopted , the draft resolution would authorize the Mayor and City Clerk to issue legislative subpoenas to the corporations and persons identifie d by the City Attorney in connection with the ATS CUP.
Once issued, the City Attorney’s office would enforce the legislative subpoenas as needed to gather information to fully inform the City Council regarding potential revocation of the ATS CUP.
FISCAL IMPACT
There is no fiscal impact associated with adopting the proposed resolutions.
Respectfully submitted and prepared by:
_____________________________
Karl H. Berger, City Attorney
Reviewed by:
_____________________________
Inez Alvarez, Interim City Manager
ATTACHMENTS
1. MPMC § 4.30.030, 4.30.050, and 21.32.150.
2. Resolution
2 Connecticut Indem. Co. v. Super. Court (2000) 23 Cal.4th 807.
Staff Report
November 1, 2022
ATTACHMENT 1
Monterey Park
Municipal Code Sections
Monterey Park, California Municipal Code
Title 4 NEIGHBORHOOD PRESERVATION
Chapter 4.30 PUBLIC NUISANCES
4.30.040 Public nuisance—Generally.
Anything which is injurious to health, or is indecent, or offensive to the senses, or any obstruction to the free use of property so as to interfere with the comfortable enjoyment of life or property, or unlawfully obstructs the free passage or use in the customary manner of any public park, square, street or highway, is a nuisance. (Ord. 2129 § 6, 2016)
4.30.040 Public nuisance—Generally. https://library.qcode.us/lib/monterey_park_ca/pub/municipal_code/item/t... 1 of 2 10/26/23, 3:19 PM
Monterey Park, California Municipal Code
Title 4 NEIGHBORHOOD PRESERVATION
Chapter 4.30 PUBLIC NUISANCES
4.30.050 Public nuisances—Designated.
It is unlawful and it is declared to be a public nuisance for any person owning, leasing, occupying, or having charge or possession of any residential, agricultural, commercial, industrial, business park, office, educational, religious, vacant, or other premises within the city, to maintain such premises in such a manner that any of the following conditions are found to exist thereon:
(a) A violation of any regulations adopted by reference by the Monterey Park Municipal Code; (b) Any land, the topography, geology, or configuration of which, whether in a natural state or as a result of grading operations, excavations, fill, or other alteration, interferes with the established drainage pattern over the property or from adjoining or other properties which does or may result in erosion, subsidence, or surface water drainage problems of such magnitude as to be injurious to public health, safety and welfare or to neighboring properties;
(c) Any building or structure which is partially destroyed, damaged, abandoned, boarded up, dilapidated, or permitted to remain in a state of partial construction; (d) The failure to secure and maintain against public access all doorways, windows, and other openings into vacant or abandoned buildings or structures; (e) Painted buildings and walls, retaining walls, fences or structures that require repainting, or buildings, walls, fences, or structures upon which the condition of the paint has become so deteriorated as to permit decay, excessive checking, cracking, peeling, chalking, dry rot, warping or termite infestation; (f) Any premises, building or structure, wall, fence, pavement, or walkway which is painted in a garish manner or is out of harmony or conformity with the standards of adjacent properties; (g) Any building or structure, wall, fence, pavement, or walkway upon which any graffiti, including paint, ink, chalk, dye, or other similar marking substances, is allowed to remain for more than twenty-four consecutive hours;
(h) Any wall, fence, gate, or hedge that is damaged, broken, dilapidated or a hazard or is maintained in violation of this code;
(i) Any wall, fence, gate, or hedge that is covered by or constructed of, whether totally or partially:
(1) Bamboo or other similar reed material, whether natural or artificial, (2) Tarpaulin materials, whether natural or man-made,
4.30.050 Public nuisances—Designated. https://library.qcode.us/lib/monterey_park_ca/pub/municipal_code/item/t... 1 of 5 10/26/23, 3:19 PM
(3) Plastic materials, or
(4) Broken windows;
(j) Any overgrown, dead, decayed, diseased or hazardous tree, weeds, vegetation, or debris which:
(1) May harbor rats, vermin, or other disease carriers, (2) Is maintained so as to cause an obstruction to the vision of motorists or a hazardous condition to pedestrians or vehicle traffic,
(3) Constitutes an unsightly appearance,
(4) Creates a danger or attractive nuisance to the public, (5) Causes detriment to neighboring properties or property values, or (6) Constitutes a fire hazard.
Notwithstanding the above, a brown lawn will not constitute a nuisance during a period for which the Governor or city council has issued a proclamation of a state of emergency based on drought conditions; (k) Building exteriors, roofs, landscaping, grounds, walls, retaining and crib walls, fences, driveways, parking lots, planters, sidewalks, or walkways which are maintained in such condition so as to become defective, unsightly, cracked or no longer viable;
(l) The accumulation of dirt, litter, trash, junk, feces, or debris in doorways, adjoining sidewalks, walkways, courtyards, patios, parking lots, planters, landscaped or other areas; (m) Any premises upon which there is or is permitted to be:
(1) Lumber, building materials, rubble, broken asphalt or concrete, containers, or other similar materials, except where construction is occurring under a valid permit, (2) Junk, solid waste, vegetation, salvage materials, scrap metals, hazardous waste, broken or neglected machinery, dirt or fill material deposited or stored contrary to any law, automobile parts, except within a commercial business lawfully engaged in retail sales, (3) Rocks, except in their natural state and location, (4) Sinks, fixtures or equipment, appliances or furniture, except lawn furniture in residential yards and new or used furniture lawfully stored or displayed in connection with a valid business engaged in the sale or purchase of the same, or
(5) Inoperative vehicles, except where permitted by zoning regulations; (n) Deteriorated driveways and parking lots, including those containing pot holes, or cracks;
4.30.050 Public nuisances—Designated. https://library.qcode.us/lib/monterey_park_ca/pub/municipal_code/item/t... 2 of 5 10/26/23, 3:19 PM
(o) Abandoned, broken, unused, neglected or unprotected equipment and machinery, ponds, reservoirs and pools, whether or not the same contains any water or liquid, excavations, abandoned wells, shafts, basements, foundations, or other holes, abandoned refrigerators or other appliances, abandoned motor vehicles, any unsound structure, skateboard ramps, or accumulated lumber, solid waste, junk, or vegetation which may reasonably attract children to such abandoned or neglected conditions;
(p) Construction equipment, buses, tow trucks, dump trucks, flatbed trucks, grading equipment, tractors, tractor trailers, truck trailers, or any other commercial vehicle over twenty-five feet long or eight feet in height or ninety inches wide, supplies, materials, or machinery of any type or description, parked or stored upon any street or property within a residential zone, except where permitted by this code or state law. “Commercial vehicle,” for the purposes of this section, is defined as any motorized or nonmotorized vehicle used or maintained to transport property or goods for profit, or persons for hire or compensation;
(q) Temporary service bins or construction debris storage bins stored on a public street or on private property, except where permitted by this code;
(r) Any garbage can, solid waste container, solid waste, packing box or junk placed or maintained so as to be visible from neighboring properties or the public right-of-way, except for those times scheduled for collection, in accordance with this code;
(s) Any property with accumulations of grease, oil, or other hazardous material on paved or unpaved surfaces, driveways, buildings, walls, or fences, or from which any such material flows or seeps on to any public street or other public or private property, or which is likely to seep or migrate into the underground water table;
(t) Any front yard, parkway, or landscaped setback area which lacks turf, other planted material, decorative rock, bark, or planted ground cover or covering, so as to cause excessive dust or allow the accumulation of debris;
(u) Any condition of vegetation overgrowth which encroaches into, over, or upon any public right-of- way including, but not limited to, streets, alleys, or sidewalks, so as to constitute either a danger to the public safety or property or any impediment to public travel; (v) Animals, livestock, poultry, or bees kept, bred, or maintained for any purpose and in violation of this code;
(w) A premises, building, habitation, or structure where debris, filth, rubbish, stagnant water or other offensive matter is permitted to accumulate so that it is unsanitary or likely to produce disease or otherwise endanger the public, health or safety;
(x) Any property, or any building or structure thereon, maintained in such condition so that it is defective, unsightly or in such condition of deterioration or disrepair that it causes or will cause an ascertainable diminution of the property values of surrounding properties or be otherwise materially detrimental to adjacent and nearby properties and improvements;
4.30.050 Public nuisances—Designated. https://library.qcode.us/lib/monterey_park_ca/pub/municipal_code/item/t... 3 of 5 10/26/23, 3:19 PM
(y) Except where construction is occurring under a valid permit and pursuant to said permit, the dumping or deposit of any waste matter in or upon any public or private highway or road, including any portion of the right-of-way thereof, or in or upon any private property into or upon which the public is admitted by easement or license, or upon any private property without the consent of the owner, or in or upon any public park or any public property other than property designated or set aside for that purpose by the governing board or body having charge of that property; (z) Except where construction is occurring under a valid permit and pursuant to said permit, any placing, depositing, or dumping of any rocks or dirt in or upon any private highway or road, including any portion of the right-of-way thereof, or any private property, without the consent of the owner, or in or upon any public work or other public property, without the consent of the state or local agency having jurisdiction over the highway, road, or property;
(aa) The parking of vehicles on private property in violation of the applicable zoning regulations for the property on which such vehicles are parked;
(bb) Rooftop storage (except as allowed pursuant to a valid permit issued by the city); (cc) Any building, use or structure wherein one or more persons engage, or have engaged, in two or more acts which are prohibited by applicable law including, without limitation:
(1) Unlawful possession or use of controlled substances, (2) Prostitution,
(3) Gambling, or
(4) Solicitation for any unlawful conduct;
(dd) Swimming pools not securely fenced or swimming pools, ponds, or other bodies of water that create an unhealthy or unsafe condition due to neglectful or improper supervision, treatment or filtration.
The intent of this prohibition is to prevent or avoid the growth of harmful or unhealthy organisms or vegetation in the water, and also to protect public health and safety; (ee) Maintaining, placing, or otherwise displaying upon any fence, wall, balcony, porch, tree, bush, or any other structure or portion thereof, any linens, rugs, fabrics, nylon, or any other item of clothing or similar items except upon a recognized clothes line facility. For the purpose of this subsection, the placement of clothes line(s) is prohibited within any front yard areas; (ff) Unruly gatherings as defined by this code;
(gg) Graffiti as defined by this code;
(hh) Any building or portion thereof maintained in a manner which constitutes a substandard building pursuant to applicable law;
(ii) Any failure by a person or owner’s association, as defined by this code, to enforce conditions of approval that are part of a permit issued in accordance with this code.
4.30.050 Public nuisances—Designated. https://library.qcode.us/lib/monterey_park_ca/pub/municipal_code/item/t... 4 of 5 10/26/23, 3:19 PM
This section is not the exclusive definition or designation of what constitutes a nuisance within this city.
It supplements and is in addition to other applicable law as it now exists or may be enacted. (Ord. 2191 § 3, 2020; Ord. 2129 § 6, 2016)
4.30.050 Public nuisances—Designated. https://library.qcode.us/lib/monterey_park_ca/pub/municipal_code/item/t... 5 of 5 10/26/23, 3:19 PM
Monterey Park, California Municipal Code
Title 21 ZONING
Chapter 21.32 PERMIT PROCEDURES—GENERALLY
21.32.150 Revocation or Suspension.
(A) Revocation or Suspension. Upon recommendation by the City Planner, Planning Commission, or the City Council, by motion, carried by at least three affirmative votes, the body which granted a variance or conditional use permit may conduct a noticed public hearing to determine whether it should be revoked. If the granting body finds, upon substantial evidence, any of the following facts to be present, it may revoke the variance or conditional use permit:
(1) That the variance or permit was obtained by fraud; (2) That the use for which such approval was granted has ceased to exist or has not operated for a period of one year, as determined by substantial evidence; (3) That the permit or variance granted is being, or has been, exercised contrary to any conditions imposed upon such permit or variance, or in violation of any law; (4) That an owner’s association required by a conditional use permit was never formed, was dissolved, regularly fails to enforce covenants, conditions or restrictions (“CC&Rs”) recorded on the property, or fails to enforce conditions of approval imposed upon the development; or (5) That the use for which the approval was granted is being exercised so as to be detrimental to the public health or safety, or as to constitute a nuisance. (B) The granting body may, but is not required to, suspend a conditional use permit or variance if it finds that timely compliance will occur without additional violations. (C) If the granting body determines that facts of subsection (A)(4) are present, it may, revoke or suspend the conditional use permit. It may also refer the matter to the City Attorney for enforcement pursuant to Chapter 4.10 of this code.
(D) If the revocation hearing is conducted by the Planning Commission, its decision may be appealed in accordance with Chapter 1.10. (Ord. 2203 § 1, 2021; Ord. 2191 § 5, 2020; Ord. 2132 § 1, 2016; Ord. 2097 § 3, 2013)
21.32.150 Revocation or Suspension. https://library.qcode.us/lib/monterey_park_ca/pub/municipal_code/item/t... 1 of 2 10/26/23, 3:20 PM
Staff Report
November 1, 2023
ATTACHMENT 2
Resolution
RESOLUTION NO.
A RESOLUTION AUTHORIZING THE CITY CLERK TO ISSUE
SUBPOENAS FOR LEGISLATIVE FACT-FINDING RELATED TO
CONDITIONAL USE PERMIT NO. CU-89-004 (AS AMENDED AND
MODIFIED) ADOPTED BY RESOLUTION NO. 9356, ON AUGUST 29, 1989.
BE IT RESOLVED by the Council of the City of Monterey Park as follows:
SECTION 1: The City Council finds as follows:
A. The City Council adopted Resolution No. 9356 on August 29, 1989 approving Conditional Use Permit No. CU-89-004 (as subsequently amended and modified) which authorized certain land uses located at 2000-2290 South Atlantic Boulevard, generally known as the “Atlantic Square” property (the “ATS CUP”).
B. The City Council believes that it may be in the public interest to consider revoking the ATS CUP. To fully inform the City Council regarding whether to move forward with revocation procedures, it is in the public interest to obtain testimonial and documentary evidence regarding this matter.
C. This Resolution is adopted in accordance with the requirements set forth in Resolution No. 2022-R38, for the purpose of obtaining information regarding potential revocation of the ATS CUP in accordance with Monterey Park Municipal Code (“MPMC”) Chapter
21.32. SECTION 2: Authorization. The City Clerk is authorized to issue subpoenas requiring the attendance of witnesses and production of documents as required by the City Attorney to inform the City Planner and City Council regarding recommendations for revocation of the ATS CUP. Persons, documents, or other tangible items must be identified in a subpoena signed by the Mayor and approved as to form by the City Attorney. This authorization expires December 31, 2024 but may be renewed upon request by the City Attorney via City Council minute order, i.e., no subsequent resolution is required.
SECTION 3: Subject-Matter of the Subpoenas. The City Attorney is authorized to inform the City Clerk regarding which witnesses and what evidence is required to fully inform the City Planner and City Council. This authority may be expanded upon request by the City Attorney via City Council minute order, i.e., no subsequent resolution is required.
A. Atlantic Square, LLC, along with its officers, directors and any other
Resolution No.
persons most knowledgeable, as determined by the City Attorney; and
B. Terramar Retail Center (“TRC”), along with its officers, directors and any other persons most knowledgeable, as determined by the City Attorney.
SECTION 4: Service. Subpoenas will be served in accordance with the provisions of Code of Civil Procedure §§ 1987 and 1988, and any successor statute or regulation.
SECTION 5: Witness fees and mileage. If requested by the witness, all witnesses appearing pursuant to subpoena will receive fees and mileage, in the same amount and under the same circumstances as prescribed by California law for the deposition of witnesses in civil actions in a superior court.
SECTION 6: Enforcement. Subpoenas issued in accordance with this Resolution may be enforced pursuant to applicable law including Government Code §§ 37105 through 37109.
SECTION 3: Electronic Signatures. This Resolution may be executed with electronic signatures in accordance with Government Code §16.5. Such electronic signatures will be treated in all respects as having the same effect as an original signature.
SECTION 4: Recordation. The Mayor, or presiding officer, is authorized to sign this Resolution signifying its adoption by the City Council of the City of Monterey Park and the City Clerk, or her duly appointed deputy, may attest thereto.
SECTION 5: Effective Date. This Resolution will become effective immediately upon adoption and will remain effective unless repealed or superseded.
PASSED AND ADOPTED this 1
st day of November, 2023.
______________________________
Jose Sanchez, Mayor
ATTEST:
____________________________
Maychelle Yee, City Clerk
APPROVED AS TO FORM:
____________________________
Karl H. Berger, City Attorney
Staff Report
November 15, 2023
ATTACHMENT 2
Miscellaneous Emails
Thursday, November 9, 2023 at 08:57:18 Pacific Standard Time
Subject: Re: Atlan*c Square request for mee*ng with City staff Date: Saturday, November 4, 2023 at 4:42:41 PM Pacific Daylight Time From: Campen, Timothy E.
To: Quick, Deborah (Perkins Coie)
CC: Hensley, Mary E., Hartman, Ray (Perkins Coie), Murphy, Alan H. (Perkins Coie), Berger, Karl H.
AHachments: image001.jpg, image002.jpg
Dear Deborah,
Thank you for your correspondence. I’ve read through your novel explana*on regarding your client’s belief that its representa*ves can meet with City staff whenever they choose.
The City AXorney, of course, is himself a public official and is responsible for protec*ng his client and its employees, as am I as the Assistant City AXorney. So, please refer to my previous correspondence on this maXer, which reflects how the City is proceeding.
In speaking with the City AXorney, he wanted to express his an*cipa*on of seeing the long-promised applica*on from your client - something that the City Council specifically invited your client to file during the mee*ng on Wednesday. We look forward to reviewing it before the next Council mee*ng on November
14th, which is when the maXer of legisla*ve subpoenas will again be in the agenda (at the Council’s direc*on).
- Tim
Timothy E. Campen | Partner
501 West Broadway, Suite 1600 | San Diego, CA 92101
d - 619.814.5810 | t - 619.814.5800 | f - 619.814.6799 | m - 619.861.7707 [email protected] | bwslaw.com
The information contained in this e-mail message is intended only for the CONFIDENTIAL use of the designated addressee named above. The information transmitted is subject to the attorney-client privilege and/or represents confidential attorney work product.
Recipients should not file copies of this email with publicly accessible records. If you are not the designated addressee named above or the authorized agent responsible for delivering it to the designated addressee, you received this document through inadvertent error and any further review, dissemination, distribution or copying of this communication by you or anyone else is strictly prohibited. IF YOU
RECEIVED THIS COMMUNICATION IN ERROR, PLEASE NOTIFY US IMMEDIATELY BY TELEPHONING THE SENDER NAMED ABOVE AT 800.333.4297. Thank you.
From: Quick, Deborah (Perkins Coie) <[email protected]> Sent: Friday, November 3, 2023 3:06:20 PM
To: Campen, Timothy E. <[email protected]>
Cc: Hensley, Mary E. <[email protected]>; Hartman, Ray (Perkins Coie) <[email protected]>; Murphy, Alan H. (Perkins Coie) <[email protected]>
Subject: RE: Atlan*c Square request for mee*ng with City staff
[EXTERNAL]
Tim,
In our collec*ve professional experience, discussions regarding a land use regulator’s interpreta*on of local codes and permit terms are typical of the ordinary course of business between landowners and business owners, and land use regulators. Such discussions help landowners and business owners understand when a formal applica*on may, or may not, be needed.
In connec*on with its con*nual explora*ons of new tenancies and pursuit of en*tlements to facilitate further capital investments in Atlan*c Square, TRC intends to engage in the Site Plan Review process provided for in the Monterey Park Municipal Code, see Sec*on 21.10.190. We appreciate your acknowledgment that the City is required to “absolutely process any applica*ons or similar submissions from your client as it would from any other person or en*ty,” which would not require any extraordinary requirement that such applica*on and any associated communica*ons be routed solely through, or require the presence of, counsel for either TRC or the City.
We trust that staff will *mely process TRC’s en*tlement applica*ons, including by engaging in all forms of staff communica*on that are part of the City’s ordinary land use regulatory and permifng prac*ces, and encompassing the informal, consulta*ve communica*ons discussed above. All of these communica*ons between TRC and City staff are protected by TRC’s First Amendment right to pe**on public officials.
Your client has made clear its desire to move forward with the ordinary course of permifng and land use regulatory maXers in a coopera*ve and produc*ve manner, and TRC will con*nue to proac*vely engage with staff in that spirit. We therefore decline your request to require that all communica*ons between TRC and City staff “on any maXers involving the Atlan*c Square property go through counsel.” Far from being required by Rule 2-100, such a devia*on from normal prac*ces risks running afoul of the duty of competence.
Issue: AXorney Represents Husband in Pending Dissolu*on Ac*on (1993) CA Eth. Op. 1993- 131.
Your October 6, 2023 leXer states: “Any mee*ngs with City staff may include a representa*ve of the City AXorney’s office being present.” To the extent you intend this statement to serve as no*ce of your intent to par*cipate in mee*ngs or communica*ons with TRC without our presence or consent, we do not consent to such mee*ngs or communica*ons. Rule 2-100 prohibits such conduct without our consent. I ssues: May
Consent Under the "No Contact" Rule of California Rule of Prof'l Conduct 2-100 Be Implied, or Must It Be Provided Expressly? If Consent May Be Implied, How Is Implied Consent Determined? (2011) CA Eth. Op. 2011-181 (“Consent of the represented party is not sufficient. Rule 2-100 specifies that the consent of the other lawyer is required in order for a member to communicate with a represented party about the subject of the representa*on.”)
Regards -
Deborah Quick | Perkins Coie LLP
SENIOR COUNSEL
D. +1.415.344.7157
E. [email protected]
From: Campen, Timothy E. <[email protected]>
Sent: Monday, October 30, 2023 9:36 AM
To: Quick, Deborah (SFO) <[email protected]>
Cc: Hensley, Mary E. <[email protected]>
Subject: Atlan*c Square request for mee*ng with City staff
Dear Deborah,
Below is an email from your client’s representa*ve, Byron de Arakal, to Jessica Serrano, Joe Torres and others in the Monterey Park’s Community Development Department.
As I stated in my Oct. 6 leXer, the City of Monterey Park is commiXed to “ensur(ing) the ability of your Client to fully access the City on maXers requiring municipal engagement, while preserving the interests of the City Defendants” whom your client is suing as an en*ty and as individuals. I asked that communica*ons between the par*es go through the aXorneys to maintain both your client’s rights to engage with the City as well as the integrity of the li*ga*on. That has not happened, and your client con*nues to not only communicate directly with represented individual defendants with even copying my office or providing any no*ce of said communica*ons.
So, I am wri*ng here to reiterate my request that communica*ons between the par*es on any maXers involving the Atlan*c Square property go through counsel. My office has similarly advised City staff.
With that in mind, I would like to respond specifically to your client’s request below to “have a conversa*on with (Jessica Serrano), Beth (Chow) and Joseph (Torres) about (their) prospec*ve tenant in the context of the current Master CUP for the center and the Zoning Code.” It appears your client understands the permiXed uses of the property per its CUP , but wants to have a discussion with staff to find a way to accommodate a prospec*ve tenant anyway. If you could please advise your client that City staff cannot provide legal advice on this or on any maXers. Further, the City will absolutely process any applica*ons or similar submissions from your client as it would from any other person or en*ty. But it appears here that your client is seeking special treatment to meet with staff before doing so to obtain guidance on how it can circumvent or change the exis*ng CUP on the property. Your client’s ac*ons further run the risk of appearing to leverage the exis*ng li*ga*on to get such special treatment. Again, please advise your client to seek the advice of its own counsel to explore how to comply with the law in pursuit of its goals. The City will con*nue to carry out its responsibili*es according to the law.
Thank you in advance for your client’s an*cipated coopera*on.
Sincerely, - Tim
Timothy E. Campen | Partner
501 West Broadway, Suite 1600 | San Diego, CA 92101
d - 619.814.5810 | t - 619.814.5800 | f - 619.814.6799 | m - 619.861.7707 [email protected] | bwslaw.com
The information contained in this e-mail message is intended only for the CONFIDENTIAL use of the designated addressee named above. The information transmitted is subject to the attorney-client privilege and/or represents confidential attorney work product.
Recipients should not file copies of this email with publicly accessible records. If you are not the designated addressee named above or the authorized agent responsible for delivering it to the designated addressee, you received this document through inadvertent error and any further review, dissemination, distribution or copying of this communication by you or anyone else is strictly prohibited. IF YOU
RECEIVED THIS COMMUNICATION IN ERROR, PLEASE NOTIFY US IMMEDIATELY BY TELEPHONING THE SENDER NAMED ABOVE AT 800.333.4297. Thank you.
From: Byron de Arakal <[email protected]>
Sent: Tuesday, October 24, 2023 3:50 PM
To: Serrano, Jessica <[email protected]>
Cc: Chow, Beth <[email protected]>; Torres, Joseph <[email protected]>; ScoX Grady <[email protected]>
Subject: Atlan*c Square Master CUP - Zoning Code Update
[EXTERNAL EMAIL]
CAUTION: This email originated from outside your organiza*on. Exercise cau*on when opening aXachments or clicking links, especially from unknown senders.
Hi Jessica –
Thanks for your response to my email earlier today.
On a separate maXer, we are following with interest the City’s “Our City, Our Plan” zoning code update. We’re looking forward to par*cipa*ng in that process rela*ve to Atlan*c Square and contribu*ng some ideas about needed updates to permiXed uses in the Shopping Center zone of the City’s Land Use Table.
As you likely know, Atlan*c Square is governed by a Master Condi*onal Use Permit first adopted in 1989 with the redevelopment en*tlements for the center. The CUP was subsequently amended in 1989, twice in 1993 and in 1999 (see aXached). As you can imagine, the CUP is quite dated and is overly restric*ve of non-retail uses and food and beverage uses given current tenant-mix trends in retail centers. In today’s retail market, shopping center tenant mixes are skewing toward a balance of non-retail (medical office, instructor-based fitness, day care, tutoring, etc.) and retail uses to match consumer preferences for one-stop convenience.
In that context, we have a major prospec*ve non-retail tenant interested in Atlan*c Square. The tenant is focused on the run of shops between Rite Aid and Big 5. The tenant would replace a den*st’s office that recently lex the center. The prospec*ve tenant did reach out to the City but was told it isn’t possible to accommodate their use. We reached out to Joseph Torres to schedule a mee*ng to discuss the prospec*ve tenant vis a vis the Atlan*c Square Master CUP and the City’s exis*ng Land Use Table. Joseph had to cancel the mee*ng due to a family maXer.
Again, we’d like to have a conversa*on with you, Beth and Joseph about our prospec*ve tenant in the context of the current Master CUP for the center and the Zoning Code.
Hope to have an opportunity to discuss at your convenience.
Regards,
Byron
BYRON DE ARAKAL
Consul*ng Director En*tlement Planning
and Special Projects
4695 MacArthur Court | Suite 700
Newport Beach, CA 92660
C 714.227.4620
[email protected]
NOTICE: This communication may contain privileged or other confidential information. If you have received it in error, please advise the sender by reply email and immediately delete the message and any attachments without copying or disclosing the contents. Thank you.
Staff Report
November 15, 2023
ATTACHMENT 3
Public Comment 11/1/2023
• Mayor Sanchez, Mayor Pro Tern Wong, Honorable Councilmembers. My name is Byron de Arakal representing TRC. We are the owners of Atlantic Square and have been for the last 27 years.
• I appreciate the opportunity to speak with you directly this evening relative to Item 2A on your Closed Session Agenda, although the circumstance is deeply disappointing, and we think unnecessarily hostile. • TRC and Monterey Park have a common interest in Atlantic Square's long term success. But if it's to succeed, the obsolete Conditional Use Permit governing the Center needs to be comprehensively amended to facilitate a market-relevant tenant mix of goods and services that provides consumers the one-stop convenience they want. After all, it was adopted before there were smart phones, Amazon and an historic pandemic that completely changed consumer habits. But modernizing Atlantic Square's CUP can only happen if we work together.
• But is that what we're doing here tonight? Are we working together? It doesn't feel like it. Instead, you're being asked to initiate legal action to compel TRC, we're assuming, to continue operating Atlantic Square according to a nearly 40-year-old document completely untethered from the realities of today's retail marketplace. And that if we don't, the Center's entitlements and CUP may be revoked.
• What we'd rather do is
collaborate with the City on a new set of rules that
will give Atlantic Square the best chance to remain relevant and successful. • That's why last week I reached out by email to Community Development Director Jessica Serrano requesting a meeting with her, Senior Planner Beth Chow and Economic Development Director Joseph Torres to discuss a prospective, major new tenant, the existing Atlantic Square Conditional Use Permit and how the City's upcoming Zoning Code update would be an ideal process for modernizing the City's Land Use tables for the Shopping Center Zone as a precursor to a CUP amendment for Atlantic Square. • Tonight's Closed Session agenda isn't the meeting we were hoping for.
• We have always valued the accessibility and responsiveness of Ms. Serrano and her staff in Planning.
• Your Building staff has been extraordinarily helpful with tenant plan checks and building permits.
• Chief Wiese has been instrumental in working directly with our Property Manager to implement new and effective security measures at Atlantic Square.
• We've appreciated our good working relationship with your Economic Development Director, Mr. Torres, in bringing new tenants to Atlantic Square including Silverlake Ramen, Fire Wings and Fit Body. • We have what we think are exciting redevelopment plans to reposition Atlantic Square for the future, to make it more accessible and more relevant to more people, and we're looking forward to collaborating with the City to affect those plans.
• But because there remains an unresolved disagreement, it appears you're being asked to take an action that could lead to revocation of Atlantic Square's entitlements and its CUP and your staff is being instructed not to talk to us on ANY matter related to Atlantic Square. And to what end? • Refusing to talk about or work together on all other things because we have an unresolved disagreement about one thing is not a formula for success.
We hope you agree. We look forward to collaborating with you and staff on Atlantic Square and its future in the coming months.
Thank you very much for listening.
City Council Staff Report
TO:
FROM:
The Honorable Mayor and City Council
SUBJECT: Minutes
RECOMMENDATION:
It is recommended that the City Council consider:
1. Approving the minutes from the regular meeting of September 6, 2023 and the special meetings of September 6, 2023 and September 26, 2023; and
2. Taking such additional, related, action that may be desirable.
EXECUTIVE SUMMARY:
None.
BACKGROUND:
None.
FISCAL IMPACT:
None.
Resp
ectf
ully submit
ted, Prepared by:
Maychelle Yee
City Clerk
Ruben Antonio Barbosa
Senior Clerk Typist
Approved By:
Inez Alvarez
Interim City Manager
ATTACHMENT(S):
1. Draft Minutes
Maychelle Yee, City Clerk
DATE: November 15, 2023
AGENDA ITEM NO: Consent Calendar - 3A
Staff Report
November 1
5, 2023
ATTACHMENT 1
Draft Minutes
71-XX
MI
SSION STATEMENT
The mission of the City of Monterey Park is to provide excellent services to enhance the quality of life for our entire community
MINUTES
MONTEREY PARK CITY COUNCIL
FINANCING AUTHORITY (MPFA)
HOUSING AUTHORITY (MPHA)
GEOLOGIC HAZARD ABATEMENT DISTRICT (GHAD)
SUCCESSOR AGENCY (SA)
SPECIAL MEETING
SEPTEMBER 6, 2023
The C
ity Council, the Financing Authority (MPFA), the Housing Authority (MPHA), the Geologic Hazard Abatement District (GHAD), and the Successor Agency (SA) of the City of Monterey Park held a Special Meeting of the Council in Room 266, Second Floor of City Hall located at 320 West Newmark Avenue in the City of Monterey Park, Wednesday, September 6, 2023 at 5:30 p.m.
CALL
TO ORDER:
Mayor Sanchez called the meeting to order at 5:35 p.m.
RO
LL CALL:
Mayor Sanchez called the roll:
Counc
il Members Present: Henry Lo, Vinh Ngo, Jose Sanchez, Thomas Wong, Yvonne Yiu
Council Members Absent: None
AL
SO PRESENT: City Attorney Karl Berger, Interim City Manager Inez Alvarez, Interim Assistant City Manager D iana Garcia, Director of Finance Martha Garcia, Director of Human Resources and Risk Management Christine Tomikawa
VIR
TUALLY PRESENT: None.
PUBL
IC COMMUNICATIONS: None.
1. CL
OSED SESSION
The City Council adjourned to Closed Session at 5:35 p.m. 1-A. CO
NFERENCE WITH LABOR NEGOTIATORS, PURSUANT TO CALIFORNIA GOVERNMENT CODE § 54957.6
City Negotiators: Steve Berliner (not present) and Christine Tomikawa Employee
Organizations:
Confidential Employees' Association, Firefighters' Association, Mid-Management Association, Police Captains' Association, Police Officers' Association, Police Officers' Mid -Management Association, Professional Chief Officers' Association, and Service Employees International Union, Local 721
71-XX
September 6, 2023
RECONVENE & ADJOURNMENT
The City Council reconvened from Closed Session with all Council Members present.
The meeting was adjourned at 5:51 p.m.
Action Taken: No reportable action taken in Closed Session.
__________________
Maychelle Yee
City Clerk
71-XX
MISSION STATEMENT
The mission of the City of Monterey Park is to provide excellent services to enhance the quality of life for our entire community.
MINUTES
MONTEREY PARK CITY COUNCIL
FINANCING AUTHORITY (MPFA)
HOUSING AUTHORITY (MPHA)
GEOLOGIC HAZARD ABATEMENT DISTRICT (GHAD)
SUCCESSOR AGENCY (SA)
REGULAR MEETING
SEPTEMBER 6, 2023
The City Council, the Financing Authority (MPFA), the Housing Authority (MPHA), the Geologic Hazard Abatement District (GHAD), and the Successor Agency (SA) of the City of Monterey Park held a Regular Meeting of the Council in the Council Chamber, located at 320 West Newmark Avenue in the City of Monterey Park, Wednesday, September 6, 2023, at 6:30 p.m.
CALL TO ORDER:
Mayor Sanchez called the meeting to order at 6:31 p.m.
FLAG SALUTE:
The Monterey Park Fire Explorers led the flag salute.
ROLL CALL:
City Clerk Maychelle Yee called the roll:
Council Members Present: Henry Lo, Vinh Ngo, Jose Sanchez, Thomas Wong, Yvonne Yiu
Council Members Absent: None
ALSO PRESENT: City Treasurer Amy Lee, Interim City Manager Inez Alvarez , City Attorney Karl Berger, Interim Assistant City Manager Diana Garcia, Interim City Librarian Kristin Olivarez , Director of Public Works Shawn Igoe, Director of Recreation and Community Services Robert Aguirre, Director of Finance Martha Garcia, Community Development Director Jessica Serrano, Director of Human Resources and Risk Manager Christine Tomikawa, Police Chief Scott Wiese, Fire Chief Matt Hallock, Interim Planning Manager Beth Chow, Recreation Supervisor Orlando Muro, Program Coordinator Alejandra Espinosa, Interim Senior Librarian Lauren Frazier, Information Technology Manager Stanley Ardon, Assistant Deputy City Clerk Helena Cho
VIRTUALLY PRESENT: Priscila Davila, Housing Consultant
AGENDA ADDITIONS, DELETIONS, CHANGES AND ADOPTIONS
Interim City Manager Alvarez announced the addition of P ublic Works and P olice Departments under staff communication. City Attorney Berger informed the City Council that the ordinance for Item No. 3I has been amended to reflect the changes requested by the City Council at the August 16
th council meeting.
71-XX
September 6, 2023
PUBLIC COMMUNICATIONS
- Sarkis Antonian spoke about Spectrum services, mask mandates, and C ovid-19 vaccines.
- Nancy Arcuri talked about an incident that occurred on September 2 regarding the Police Department assisting a stranded motorist on New Avenue and Graves Avenue and expressed her gratitude to the Department.
- Joseph Leon, City Representative on the Board of Trustees for the San Gabriel Valley Mosquito Vector District, provided an update on spraying in the City of Monterey Park. He reported no spraying will occur to combat mosquito infestation in the city, and no West Nile Virus has been reported in the City. He also provided a phone number for information, 626-814-9446
- Angela Pao- Johnson introduced herself as the new Executive Director of Meaningful Experiences and Relationships through Community Inclusion (MERCI), an organization that provides home and community -based services to adults with developmental disabilities. She asked the Council and community for any new opportunities for partnership. She provided her contact phone number; 310-991-1289.
- Randye Kay spoke about ongoing traffic issues at the intersection of Chandler and Hellman Avenues.
- City Clerk Yee received, filed, and read one written communication from resident Michael Becerra regarding safety concerns at the intersection of Chandler and Hellman Avenues.
STAFF COMMUNICATIONS
- Community Development: Community Development Director Serrano spoke about the upcoming Community Workshop, “Our City, Our Plan” on September 11, giving access to the public to be heard on issues involving the economic development of the City of Monterey Park. She also provided contact information for the Community Development Department.
- Fire Department: Fire Chief Hallock cited that September is designated as Emergency Preparedness Month and presented information on emergency preparedness in the home. He spoke about how to take steps in recognizing potential emergencies, assembling an emergency kit, and knowing what to do during and after an emergency. He encouraged the public to join the Community Emergency Response Team (CERT), and referred the community to preparempk.com, a website that details preparedness tips. He also took brief questions from the Council.
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- Library: Interim Children’s Senior Librarian Frazier presented the new hours of operation for the Bruggemeyer Library, including expanding hours to six full days and invited the public to the ribbon cutting ceremony and reception on September 18 at 4:30 p.m. She also encouraged participation in Library Card Sign-up Month, with outreach events starting September 16 with Alhambra Unified School District, September 21 at Movie in the Park, and September 28 at the Farmer’s Market.
She talked about Elder Law Day on September 30, sponsored by The Asian Pacific American Bar Association of Los Angeles County , mentioned Homework Help in the Library, Hispanic Heritage Month events starting September 16 through October 15 , Mid -Autumn Festival which offers arts and crafts, and the College Preparation Workshops sponsored by the Chinatown Service Center and the Library Foundation Gala to be held on October 13 at Luminarias Restaurant.
Interim City Librarian Olivarez answered a Council question regarding the free mental health services offered by the Chinatown Service Center on Wednesdays and Fridays.
- Recreation and Community Services Department: Recreation Supervisor Muro thanked those who participated in the Langley Center’s Wildest Party in The West event, and the Karaoke contest. He spoke about the upcoming Hispanic Heritage Month events starting September 14 through October 12. Events will include the Friendly Fred walk with a Council Member, “Selena” Movie in the Park, an d Fun Fiesta at the Langley Center. He also invited the community to the 9/11 Patriot Day event at City Hall. He encouraged the Council and community to save the date for upcoming events Electric Park on October 14 which includes music, food trucks and games; as well as Monster Mash on October 19 in conjunction with Bruggemeyer Library which will include local vendors and trick or treating. Both events will be held at Barnes Park.
- Public Works : Director Igoe recapped the distribution of over 10,000 sandbags during the recent storm event. He encouraged residents to keep the sandbags and try to reuse them during the upcoming rainy season. He also promoted the Community Clean-up Day at Elder Park on October 7, where residents can come to dispose of items.
- Police Department: Police Chief Wiese spoke of the commemoration of Monterey Park Officer William Guidera who died on September 9, 1927, assisting a motorist.
The Chief also spoke about a new page on the Police Department website coming soon regarding firearms safety. The site will cover firearms safety, firearms disposal and turn in, and California firearms laws. The Chief also detailed how the Department has partnered with a child- safe organization to provide 100 safety locks which will be available soon for free. The Chief spoke about California Senate Bill 2, which amends current concealed weapon laws and in conjunction, spoke about business owner’s rights regarding signage not allowing firearms on their property. Based on Council questions, The Chief elaborated on the types of community outreach the Department would enact once the bill is passed into law.
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1. PR ESENTATION – None.
Matters listed under presentation are informational content and for discussion only.
2. O LD BUSINESS
2-A. DISCUSSION OF CITY COUNCIL’S STANCE ON AMENDED SENATE BILL (SB) 710 (DURAZO)
Staff was recently made aware that the Office of California Senator Maria Elena Durazo amended SB 710 to clarify the jurisdictions affected by the Bill (i.e., it now only covers the cities of Alhambra and Los Angeles). The City was invited to take appropriate action. The amended language changes “committee” to “task force” and specifically names the entities that will have representatives on the task force.
If SB 710 were enacted, the Terminus Regional Planning Task Force would meet quarterly to discuss traffic issues and potential land uses, including affordable housing, student housing, workforce development space, public university expansion, parks, open space, and alternative transportation. The Task Force is also required to complete and submit a report to the Legislature by December 1, 2025, on projects and land use in the State Route 710 Terminus adjacent areas, including a summary and status of the Alhambra 710 Arterial Project. Both the cities of Alhambra and Los Angeles are in support of SB 710 as amended.
Action Taken: By consensus, the City Council gave direction to maintain opposition and gave authority to the Mayor to draft a letter to request a seat on the Task Force based on legislative actions.
3. CO
NSENT CALENDAR ITEMS NOS. 3A-3Q
All items under the Consent Calendar are considered by the City Council to be routine and will be enacted by one motion. Specific items may be removed from the Consent Calendar at the request of any member of the City Council for separate consideration.
Action Taken: The City Council approved and adopted A genda Item No s. 3A, 3C, 3G, 3H, 3I, 3J, 3K, 3L, 3M, 3O, 3P and 3Q on Consent Calendar, excluding Item No s. 3B, 3D, 3E, 3F, and 3N which were pulled for discussion, separate motion, reading resolutions and ordinances by the title only and waiving further reading thereof. Mayor Pro Tem Wong reported a conflict of interest on Agenda Item No. 3P as his real property is within 500 feet of one of the project sites.
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Motion: Moved by Mayor Pro Tem Wong and seconded by Council Member Ngo, motion carried by the following vote:
Ayes: Council Members: Lo, Yiu, Ngo, Wong, Sanchez
Noes: Council Members: None
Absent: Council Members: None
Abstain: Council Members: None
Recusal: Council Members: Wong - Item No. 3P
3-A. MINUTES
Approving the minutes from the regular meetings of June 7, 2023, and June 21, 2023 and the special meetings of June 7, 2023, June 12, 2023, and June 21, 2023.
Action Taken: The City Council approved the minutes from the regular meetings of June 7, 2023, and June 21, 2023, and the special meetings of June 7, 2023, June 12, 2023, and June 21, 2023, on Consent Calendar.
3-B. AUTHORIZATION FOR MAYOR TO SIGN LETTERS OF SUPPORT FOR CALIFORNIA SENATE BILL 326 AND ASSEMBLY BILL 531 ADDRESSING
MENTAL AND BEHAVIORAL HEALTH SERVICES
California Senate Bill 326 (SB 326) aims to modernize and reform the Mental Health Services Act (MHSA), enhancing services for individuals with substance use disorders and serious mental illness. Assembly Bill 531 (AB 531) proposes a $4.68 billion general obligation bond to build treatment beds and housing units, addressing the shortage of behavioral health care options and providing housing for those experiencing homelessness with behavioral health needs. The behavioral health modernization package will go to the voters for approval on the March 2024 ballot , after consideration and approval by the Legislature and Governor Newsom’s signature.
Action Taken: The City Council authorized the Mayor to Sign Letters of Support for California Senate Bill 326 and Assembly Bill 531 a ddressing Mental and Behavioral Health Services, as amended to see if Los Angeles County is in support of bills, if so, authorized all City Council signatures on possible support letters.
Motion: Moved by Mayor Pro Tem Wong and seconded by Council Member Ngo, motion carried by the following vote:
Ayes: Council Members: Lo, Yiu, Ngo, Wong, Sanchez
Noes: Council Members: None
Absent: Council Members: None
Abstain: Council Members: None
Recusal: Council Members: None
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3-C. CONSIDERATION AND POSSIBLE ACTION TO ADOPT A RESOLUTION TO
RECORD A NOTICE OF NUISANCE ABATEMENT LIEN AGAINST CERTAIN REAL PROPERTY IN THE CITY (APN 5254-002-031)
Adopting the attached resolution in the staff report will allow the City to recover costs, including attorney’s fees, incurred the City’s abatement of the public nuisance present on certain real property located in the City (Lot 1 of Tract No. 34875—APN 5254-002-031) (the “Property”) owned by Center Int’l I nvestments, Inc. (“CII”).
The Resolution authorizes recording the associated Notice of Nuisance Abatement Lien in the amount of $1,772,244.06. This will be the fifth lien placed on the Property and covers expenses that the City incurred between January 1, 2023, and June 30, 2023. After recording this lien, the liens against the Property will total $12,093,904.27.
CEQA (California Environmental Quality Act):
Adoption of the Resolution is exempt from the California Environmental Quality Act (“CEQA”) under CEQA Guidelines § 15061(b)(3) because it can be seen with certainty that there is no possibility that the action proposed by the proposed resolution would have a significant effect on the environment.
Action Taken: The City Council adopted Resolution No. 2023-R69 to record a Notice of Nuisance Abatement Lien, on Consent Calendar.
Resolution No. 2023-R69:
A RESOLUTION AUTHORIZING THE RECORDATION OF A NUISANCE
ABATEMENT LIEN AGAINST CERTAIN REAL PROPERTY LOCATED IN THE CITY (APN 5254-002-031)
3-D. 2022-2023 ANNUAL INVESTMENT REPORT
The City's Investment Policy requires an annual investment report and a statement of investment policy to be submitted to the City Council for annual review. The attached annual
report shows that all investment activities
during 2022-23 were conducted according to the fiscal year 2022 -2023 City’s Investment Policy.
The Treasury Committee is introducing and recommending adoption of the Investment Policy developed by Chandler Asset Management company.
This Item was heard with Item No. 3E.
Discussion: City Treasurer Amy Lee reported the total investment balance for the City as of June 30, 2023 as $87,989,100.53 and introduced Regional Director Mia Corral Brown and Associate Portfolio Strategist Kara Hooks from Chandler Asset Management to speak on the annual investment report and investment/advisory
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services. Finance Director Garcia provided a PowerPoint presentation along with the representatives from Chandler Asset Management in conjunction with Item No. 3E. The Council took part in a question -and-answer session on the annual investment report and management services offered.
Action Taken: The City Council a dopted Resolution No. 2023 -R70/SA-187 authorizing the City Treasurer and City Manager to implement the City’s Investment Policy for FY 2023- 24; and received and filed the 2022- 23 Annual Investment Report.
Resolution No. 2023-R70 / SA-187:
A JOINT RESOLUTION OF THE CITY OF MONTEREY PARK; THE
SUCCESSOR AGENCY TO THE MONTEREY PARK REDEVELOPMENT
AGENCY; THE MONTEREY PARK FINANCING AUTHORITY; THE MONTEREY PARK HOUSING AUTHORITY; AND THE GEOLOGIC HAZARD ABATEMENT
DISTRICT ADOPTING AN INVESTMENT POLICY AND AUTHORIZING THE
TREASURER AND CITY MANAGER TO IMPLEMENT THE POLICY
3-E. PROFESSIONAL SERVICES AGREEMENT FOR INVESTMENT
MANAGEMENT/ADVISORY SERVICES BY CHANDLER ASSET
MANAGEMENT
Professional investment management of public funds is a best practice which provides substantial benefits to the City of Monterey Park. These benefits include day-to-day monitoring of investments within the portfolio, including daily analysis of available market yields; re-balancing of the portfolio's duration (average maturity) to take advantage of higher interest when available, daily credit monitoring of investment instruments, security selection and competitive shopping of investments to obtain the best execution of trades. Performance measurement against selected benchmarks and compliance will be monitored daily with the City’s investment policy and California Government Code and reported formally to the City as part of its monthly reporting package. The goal of external management is to maximize the return on investments within the portfolio, while minimizing risk of principal and prioritizing safety of principal and liquidity.
This Item was heard with Item No. 3D.
Recommendation:
It is recommended that the City Council consider; (1) a uthorizing the Interim City Manager to execute an agreement, in a form approved by the City Attorney, with Chandler Asset Management for providing investment advisory services for three years with two optional one-year extensions (maximum 5-year contract term) and (2) taking such additional, related, action that may be desirable.
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Action Taken: By consensus, the City Council continued this item to a future Council Meeting.
3-F. SERVICES AGREEMENT AMENDMENT WITH NETWORK MAGIC,
UNLIMITED, INC. FOR NETWORK AND INFRASTRUCTURE SERVICES
Recently, the City has been experiencing intermittent network outages which are causing periodic lost internet and email connections citywide. In order to improve the network stability, upgrade the infrastructure, and improve cybersecurity, the City is requesting to amend the agreement with existing vendor, Network Magic, to modify scope of services and to increase compensation to an amount not to exceed $228,900.
Action Taken: The City Council authorized the Interim City Manager to execute an Amendment with Network Magic, Unlimited, Inc., in a form approved by the City Attorney, to provide network and firewall services for amount not to exceed $228,900.
Motion: Moved by Mayor Pro Tem Wong and seconded by Council Member Lo, motion carried by the following vote:
Ayes: Council Members: Lo, Yiu, Ngo, Wong, Sanchez
Noes: Council Members: None
Absent: Council Members: None
Abstain: Council Members: None
Recusal: Council Members: None
3-G. RESOLUTION APPROVING THE MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY AND THE MONTEREY PARK SERVICE EMPLOYEES’ INTERNATIONAL UNION, LOCAL 721 FOR THE TERM OF JULY 1, 2023 TO JUNE 30, 2025
Representatives of the City of Monterey Park (“City”) and SEIU met and conferred to negotiate the terms and conditions of a new Memorandum of Understanding (“MOU”) regarding employment. The parties reached an agreement on an MOU effective July 1, 2023 to June 30, 2025.
Action Taken: The City Council adopted Resolution No. 2023- R71 approving a Memorandum of Understanding (“MOU”) between the City of Monterey Park and the Monterey Park Services Employees’ International Union, Local 721 (“SEIU”) , on Consent Calendar.
Resolution No. 2023-R71
A RESOLUTION APPROVING THE MEMORANDUM OF UNDERSTANDING
FOR CONTRACT YEAR 2023 -2025 BETWEEN THE CITY OF MONTEREY PARK AND THE MONTEREY PARK SERVICE EMPLOYEES’ INTERNATIONAL UNION (SEIU), LOCAL 721
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3-H. PURCHASE OF TWO LAW ENFORCEMENT MOTORCYCLES
The Police Department has two traffic motorcycles that need to be replaced (Units 047 and 122). Aging Unit 047 has exceeded its useful life with the current mileage exceeding 120,000 miles and Unit 122 was involved in a traffic collision which resulted in a total loss. The new motorcycles will be used by Motor Officer s who will continue to enforce traffic -related laws to reduce injury and fatal traffic collisions.
Action Taken: The City Council waived bidding requirements pursuant to Monterey Park Municipal Codes §3.20.050 (2) through (4) and authorized the Interim City Manager to execute an amendment to Agreement No. 2004- A with Long Beach BMW Motorcycles, in a form approved by the City Attorney, for the purchase of two (2) 2024 BMW R1250 RT-P 753 law enforcement motorcycles; on Consent Calendar.
3-I. WAIVE FURTHER READING AND ADOPT AN ORDINANCE ADDING SECTION
13.18 ENTITLED “FIREARMS PROHIBITED ON PUBLIC PROPERTY” TO THE
MONTEREY PARK MUNICIPAL CODE
On March 1, 2023, the City Council adopted Resolution No. 2023-R15 in response to the Mass Casualty Incident (“MCI”) on January 21, 2023, that killed 11 people and critically injured nine others. On July 19, 2023, the City Council adopted Ordinance No. 2233 on an urgency basis that added a new Chapter 21.55 to the Monterey Park Municipal Code (“MPMC”) establishing a Firearm Health Protection Zone regulating firearms dealers.
During the same meeting, the City Council gave direction on several additional items that were identified in Resolution No. 2023- R15. Among other things, the City Council directed that two ordinances be drafted: one requiring that trigger locks or storage devices be used for firearms; the other prohibiting firearms on City-owned property. The former ordinance is a separate agenda item; the latter is part of this agenda item.
Additionally, the City Council gave general policy directions for a myriad of firearms related matters that are reflected in the draft resolution accompanying the staff report.
Action Taken: The City Council w aived the second reading and adopted Ordinance No. 2235, on Consent Calendar.
Ordinance No. 2235
AN ORDINANCE ADDING A NEW CHAPTER 13.18 TO THE MONTEREY PARK
MUNICIPAL CODE PROHIBITING THE PRESENCE OF FIREARMS ON CITY -
OWNED PROPERTY
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3-J. WAIVE FURTHER READING AND ADOPT AN ORDINANCE ADDING SECTION
9.58.050 ENTITLED “SAFE STORAGE” TO THE MONTEREY PARK
MUNICIPAL CODE
This Ordinance was drafted in accordance with Section 3(B)(8) of City Council Resolution No. 2023-R15, adopted March 1, 2023. That Section directed the City Manager and City Attorney to proposed amendments to the Monterey Park Municipal Code (“MPMC”) that, to the extent legally feasible, require all firearms in a residence be securely stored in a locked container or disabled with a trigger lock.
If adopted, this Ordinance would add a new section to the MPMC requiring that firearms maintained in a residence be locked in a container or disabled with a trigger lock.
Action Taken: The City Council w aived the second reading and adopt ed Ordinance No. 2236, on Consent Calendar.
Ordinance No. 2236
AN ORDINANCE ADOPTING SAFE FIREARM STORAGE WITHIN THE CITY OF
MONTEREY PARK
3-K. WAIVE FURTHER READING AND ADOPT ZONING CODE AMENDMENT NO. 22-01 (ZCA -22-01), AN ORDINANCE AMENDING THE MONTEREY PARK MUNICIPAL CODE, CHAPTER 21.19, ENTITLED “INCLUSIONARY HOUSING”
TO IMPLEMENT THE MONTEREY PARK HOUSING ELEMENT
The Planning Commission, at its April 25, 2023 meeting, reviewed the Inclusionary Housing Ordinance (“IHO”), and recommended City Council approval, with a minor change. The Commission recommended that a change be made to the IHO so that in cases where the number of required affordable units results in a fractional unit, the number would be rounded up to the next whole number for units to be provided on-site or the in-lieu fees be paid.
On June 7, 2023, the City Council reviewed the IHO and by a unanimous vote, continued the adoption of the IHO to August 16, 2023 for staff to further research.
Thereafter, on June 21, 2023, the City Council by a unanimous vote continued the adoption of fees related to IHO to August 16, 2023. The staff report (without attachments) from the June 7, 2023 City Council meeting is contained in Attachment 2 of the staff report.
Staff amended the IHO related to rounding of fractional units for the calculation of inclusionary housing units or in- lieu fees as shown in Attachment 1 of the staff report.
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Major findings from staff’s research and analysis include:
1. City would likely not be at a competitive disadvantage if an IHO is adopted, but a feasibility study can better evaluate the City’s market trends to ensure that the IHO does not deter housing production and that the correct in- lieu fee is established;
2. Funds from developer-paid-in-lieu fees may be used for a variety of uses to help leverage affordable housing, as determined by City Council;
3. Comparable community benefits may include facilities, improvements and programs which enhance quality of life for City residents;
4. In addition to the Density Bonus regulations, incentives, such as fee waivers, may be offered to encourage construction of lower income housing units;
5. IHO contains affordability requirements which may be best monitored through a housing consultant; and
6. Periodic review of IHO is recommended at 3-5 year intervals.
Action Taken: The City Council waived the second reading and adopt ed Ordinance No. 2237, on Consent Calendar.
ORDINANCE NO. 2237
AN ORDINANCE ADDING CHAPTER 21.19, ENTITLED “INCLUSIONARY HOUSING,” TO THE MONTEREY PARK MUNICIPAL CODE
3-L. ONE-YEAR TIME EXTENSION FOR TENTATIVE MAP NO. 82607 (TM-20-03) – 126 NORTH NEW AVENUE (ASSESSOR’S PARCEL NO. (APN 5286-019-013)
The applicant, Jimmy Lee of LDC, Inc. on behalf of the property owner Greenstate Holding Inc., seeks a first, one-year time extension to record the final map related to the Whitmore Villas project. The project proposes to subdivide one lot into two lots. In addition, the project consists of construction of 63 new residential units and a subdivision of air rights for townhome purposes. The applicant timely filed this application request on July 6, 2023.
Pursuant to Monterey Park Municipal Code (“MPMC”) § 20.04.120, the City Council “will either approve, conditionally approve or deny extension requests. Each extension of tentative map approval or conditional approval may be allowed for a period not exceeding one year from the anniversary date of the map’s original approval. The total time of extensions cannot exceed six years from the initial expiration date.” It is recommended that the City Council determine whether good cause for the extension exists.
CEQA (California Environmental Quality Act):
The Project is consistent with the Mitigated Negative Declaration and Mitigation Monitoring Program adopted by City Council on July 21, 2021 under Resolution No. 12259. No additional environmental review is necessary.
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Public Comment was heard during Consent Calendar
- Nancy Arcuri: Spoke in favor of the Item and expressed concern over traffic flow around the area.
Action Taken: The City Council a dopted Resolution No. 2023-R72 approving a Time Extension for Tentative Map No. 82607 (TM-20-03, on Consent Calendar.
Resolution No. 2023-R72
A RESOLUTION APPROVING A FIRST ONE -YEAR EXTENSION FOR
TENTATIVE MAP NO. 82607 (TM -20-03) TO SUBDIVIDE ONE LOT INTO TWO LOTS LOCATED AT 126 NORTH NEW AVENUE (ASSESSOR’S PARCEL NUMBER: 5286-019-013)
3-M. CALIFORNIA STATE LIBRARY ZIP BOOKS GRANT FISCAL YEAR 2023/24
The Library was notified of a $3,776 award from the California State Library. The grant funds will be utilized to continue to offer the Zip Books program, which allows library cardholders to request books that are not already owned by the library and have them delivered directly to their home via Amazon Prime.
Action Taken: The City Council accepted $3,776 in California State Library grant funding to purchase books and an Amazon Prime membership; and appropriated the $3,776 funding into the 2023-24 Fiscal Year budget, on Consent Calendar.
3-N. ENVIRONMENTAL SYSTEMS RESEARCH INSTITUTE (ESRI) ENTERPRISE
AGREEMENT
ESRI is a Geographic Information System (GIS) software company. The City has been working with ESRI on a limited basis since 2008. ESRI’s software helps the City map infrastructure and City assets to prioritize operations and maintenance.
As ESRI is the so le-source provider for ESRI products in the United States, staff recommends the City Council waive the bidding requirements pursuant to Monterey Park Municipal Code (MPMC) 320.050(2), and authorize the Interim City Manager to execute a three- year agreement with ESRI to provide GIS software, maintenance, and support for the Department of Public Works at a cost of $56,860 per year or $170,580 total agreement cost.
Action Taken: The City Council waived the bidding requirements pursuant to Monterey Park Municipal Code § 3.20.050(2) and authoriz ed the Interim City Manager to execute an agreement, in a form approved by the City Attorney, with Environmental Systems Research Institute, Inc. (ESRI), for Enterprise GIS software, maintenance and support in an amount of $170,580.
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Motion: Moved by Mayor Pro Tem Wong and seconded by Council Member Ngo, motion carried by the following vote:
Ayes: Council Members: Lo, Yiu, Ngo, Wong, Sanchez
Noes: Council Members: None
Absent: Council Members: None
Abstain: Council Members: None
Recusal: Council Members: None
3-O. RESOLUTION AUTHORIZING THE INTERIM CITY MANAGER, OR DESIGNEE,
TO APPLY FOR, SUBMIT APPLICATIONS, RECEIVE AND APPROPRIATE
GRANT FUNDS FOR ALL CALRECYCLE GRANTS FOR WHICH THE CITY IS
ELIGIBLE
The California Department of Resources Recycling and Recovery (CalRecycle) requires all jurisdictions to adopt a resolution that authorizes the Interim City Manager or designee to submit applications and execute documents related to the administration of C alRecycle grants. CalRecycle administers the Household Hazardous Waste (HHW) Grant Program to provide local governments with opportunities to implement HHW programs for the collection, public education, source reduction, reuse, and/or recycling of HHW. It is recommended that the City Council adopt a resolution authorizing the Interim City Manager, or designee, to apply for, submit applications, receive, and appropriate grant funds for all CalRecycle Grants for which the City is eligible, including the FY 2023-2024 HHW Grant Program.
Action Taken: The City Council adopted Resolution No. 2023-R73 authorizing the Interim City Manager, or designee, to apply for, submit applications, receive, and appropriate grant funds for all CalRecycle Grants for which the City is eligible, on Consent Calendar.
Resolution No. 2023-R73
RESOLUTION AUTHORIZING SUBMITTAL OF APPLICATIONS FOR ALL
CALRECYCLE GRANTS FOR WHICH THE CITY OF MONTEREY PARK IS ELIGIBLE.
3-P. AMENDMENT TO CT&T CONCRETE PAVING, INC. AGREEMENT 2373 -AC,
AND AWARD OF CONTRACT FOR SIDEWALK REPAIR PROJECT
On June 7, 2023, City Council approved a public works contract with CT&T Concrete Paving, Inc., to install curb ramps, sidewalks, curb & gutter, and bus pads throughout the City. The Public Works contract was for a total amount of $1,571,233, plus contingency up to $157,123 or 10% of the contract amount. Due to the competitive prices of CT&T Concrete Paving, Inc, staff recommends amending the current agreement with CT&T Concrete Paving, Inc. for additional installation of curb ramps, sidewalk, and curb & gutter at various location and installation of concrete stairs and handrails at the Barnes Park Amphitheater,
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increasing the approved contract amount from $1,571,233 to $1,867,433 plus $186,743 contingency.
CEQA (California Environmental Quality Act):
The proposed project is categorically exempt from the requirements of the California Environmental Quality Act (CEQA) pursuant to 14 California Code of Regulations § 15301 as a Class 1 categorical exemption (Existing Facilities). The Project results in minor alterations to existing public facilities involving no significant expansion of the existing use. The Project is not anticipated to have any significant impacts with regard to noise, air quality, or water quality.
Action Taken: Mayor Pro Tem Wong reported a conflict of interest on Agenda Item No. 3P as his real property is within 500 feet of one of the project sites. The City Council authorized the Interim City Manager to execute the First Amendment, in a form approved by the City Attorney, to Agreement No. 2373- AC with CT&T Concrete Paving, Inc., to increase the contract amount by $296,200, for additional concrete work for a total of $1,867,433 plus $186,743 in contingency, on Consent Calendar.
3-Q. RECEIVE AND FILE STAFF REPORT SUMMARIZING THE STATUS OF
EMERGENCY REPAIRS OF THE MONTEREY PASS ROAD WATER LINE
On August 17, 2022, City Council adopted Resolution No. 2022- R69 authorizing the City Manager to take necessary measures for emergency repair of a water main line on Monterey Pass Road.
Recurring water main leaks in several areas within Monterey Pass Road between the intersections of Vagabond Drive and Brightwood Street resulted in extensive infrastructure damage to the roadway and necessary water main pipe repairs to ensure continued water service to residences and businesses in the area.
The design phase was completed in December 2022 followed by research of available material and cost during the months of December and January to ensure the project could be expedited due to the significant material delivery delays.
Construction started in March 2023 and is scheduled to be complete by December 2023.
Action Taken: The City Council r eceived and filed the staff report summarizing the status of emergency repairs of the Monterey Pass Road water line, on Consent Calendar.
4. PUBLIC HEARING
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4-A. PUBLIC HEARING TO REVIEW AND APPROVE THE FISCAL YEAR (FY) 2022- 23 CONSOLIDATED ANNUAL PERFORMANCE AND EVALUATION REPORT (CAPER) FOR SUBMITTAL TO THE U.S. DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT (HUD)
The U.S. Department of Housing and Urban Development provides funding to states, counties and cities in the form of Community Development Block Grant (CDBG) and HOME Investment Partnerships (HOME) funds. Since the City of Monterey Park is an Entitlement City, the City is eligible to receive both CDBG and HOME funds which it has for many years.
As a condition of receiving federal grant funding, Federal regulations require the City to submit a Consolidated Annual Performance and Evaluation Report (CAPER) to the Department of Housing and Urban Development (HUD). The CAPER provides information to HUD documenting the City’s progress in meeting its Community Development Block Grant (CDBG) and HOME Investment Partnership (HOME) program goals.
The City of Monterey Park’s Housing Division has completed its Consolidated Annual Performance and Evaluation Report (Attachment 1 to the staff report ) for the period July 1, 2022, through June 30, 2023. The CAPER describes the overall use of Federal Community Development Block Grant (CDBG) and HOME Investment Partnerships (HOME) funds received from the U.S. Department of Housing and Urban Development ( HUD) in relationship to the needs of the community as outlined in its FY 2022- 23 Annual Action Plan. The C ity's overall objective in the CDBG and HOME programs is the development of viable communities by providing decent housing, a suitable living environment, and expansion of economic opportunities primarily for low -to-moderate income persons.
It is recommended that the City Council conduct a Public Hearing to receive community feedback on the FY 2022- 23 CAPER and approve its submission to HUD.
A copy of the draft CAPER was made available for public review on August 21, 2023, through September 5, 2023. All comments will be incorporated into the final CAPER.
Discussion: Finance Director Garcia along with Housing Consultant Davila presented the background and requirements for the Consolidated Annual Performance and Evaluation Report (CAPER).
Action Taken: The City Council (1) opened the public hearing at 9:23 p.m. to receive testimonial and documentary evidence and closed the public hearing at 9:29 p.m. with no registered speakers ; (2) approved the draft FY 2022- 2023 Consolidated Annual Performance and Evaluation Report (CAPER) for the Community Development Block Grant ("CDBG"), and HOME Investment
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Partnerships ("HOME") Programs; (3) directed staff to prepare and transmit the final documents to the U.S. Department of Housing and Urban Development ("HUD"); and (4) authorized the Interim City Manager, or her designee, to take all actions necessary or desirable to complete and submit the CAPER.
Motion: Moved by Mayor Pro Tem Wong and seconded by Mayor Sanchez, motion carried by the following vote:
Ayes: Council Members: Lo, Wong, Yiu, Ngo, Sanchez
Noes: Council Members: None
Absent: Council Members: None
Abstain: Council Members: None
Recusal: Council Members: None
4-B. A CONTINUED PUBLIC HEARING TO CONSIDER ADOPTING A RESOLUTION
ESTABLISHING CITY -WIDE FEES RELATED TO THE INCLUSIONARY
HOUSING ORDINANCE
The Inclusionary Housing Ordinance (IHO) had a 1
st reading on August 16, 2023;
it is scheduled for 2nd reading and potential adoption this evening. If adopted, the Ordinance will go into effect 30 days from the 2nd reading.
As part of the IHO, one of the options to comply with the regulations is to pay in- lieu fees for developments subject to the IHO. The in- lieu fees would be used by the City to fund other affordable housing programs or projects. The proposed resolution will establish a method for calculating the inclusionary housing in- lieu fee and a consultant fee for calculating an individualized in- lieu fee per project.
Calculation of the in- lieu fee will be based on the “affordability gap” between the market and affordable rate for new for -sale or for-rent units. Developers opting to pay an in- lieu fee rather than provide on- site affordable units will be required to pay a fee equivalent to the “affordability gap” times the number of required affordable units.
CEQA (California Environmental Quality Act):
Pursuant to the California Environmental Quality Act (Public Resources Code § 21000, et seq.; “CEQA”) and its implementing regulations (14 Cal. Code of Regs. § 15000, et seq.; the "CEQA Guidelines”), the proposed fee resolution is categorically exempt from further CEQA review for the following reasons: (1) they will not result in a direct or reasonably foreseeable indirect physical change in the environment (CEQA Guidelines § 15060(c)(2)); (2) there is no possibility that the may have a significant effect on the environment because any potential, future, housing projects would undergo separate environmental review (CEQA Guidelines § 15061(b)(3)); and (3) the Resolution, by itself, does not constitute a “project” as defined in the CEQA Guidelines because it i nvolves a policy action that is legislative implementing affordable housing policy and affects prospective future
71-XX
September 6, 2023
housing development to comply with Housing Element Program 15 (CEQA Guidelines § 15378).
Discussion: Community Development Director Serrano along with Interim Planning Manager Chow provided a PowerPoint presentation on fees related to Inclusionary Housing . A revised agenda with corrected recommendation was posted and made available to the public on September 5.
Action Taken: The City Council opened a continued public hearing at 9:30 p.m. and took testimonial and documentary evidence; after closing the public hearing at 9:39 p.m. with no registered speakers , and after considering the evidence submitted during that public hearing, a dopted Resolution No. 2023- R74 establishing the formula to calculate in- lieu fees and fees associated with the calculation of in-lieu fees for the Inclusionary Housing Ordinance.
Motion: Moved by Mayor Pro Tem Wong and seconded by Council Member Lo, motion carried by the following vote:
Ayes: Council Members: Lo, Wong, Yiu, Ngo, Sanchez
Noes: Council Members: None
Absent: Council Members: None
Abstain: Council Members: None
Recusal: Council Members: None
RESOLUTION NO. 2023-R74
A RESOLUTION APPROVING AN INCLUSIONARY HOUSING IN-LIEU FEE
5. NEW BUSINESS
5-A. DISCUSSION OF ESTABLISHING A MEMORIAL COMMITTEE FOR THE JANUARY 21ST MASS SHOOTING INCIDENT
On January 21st, the City of Monterey Park experienced a tragic mass shooting incident that resulted in the loss of 11 lives and left the community deeply affected.
The City recognizes the need to honor the memory of the victims and create a space for healing, remembrance, and reflection for the entire community.
In response to this tragic event, there has been public interest and support for the creation of a permanent memorial that will serve as a place for residents and visitors to pay their respects and remember the lives that were lost. The memorial would serve not only as a tribute to the victims but also as a symbol of resilience and unity for the Monterey Park community. Communities affected by similar tragedies often establish committees that tackle the fundraising, outreach and planning for permanent memorials, which consist of a diverse group of community members, stakeholders, and experts in memorial design and public spaces.
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September 6, 2023
Initial research on the memorials for six mass casualty events in the United States is attached for Council to review and to help guide initial discussion. Council may provide direction on next steps and/or request this item to be put on the agenda for discussion at future meetings.
Discussion: Interim City Manager Diana Garcia presented the discussion to establish a committee that would be tasked with creating a memorial for the mass shooting incident. She presented options for the different types of committees that could be established. Council Member Lo discussed other examples of memorial committees and suggested clarification of powers, parameters, direction and how the Council would handle those elements. Interim City Manager Alvarez also pointed out the consideration of the level of commitment of those within the memorial committee, when considering how long the process could be. Council Member Ngo also cited the length of process in creating a memorial and encouraged the start of discussion. Mayor Pro Tem Wong suggested a roundtable to discuss the actual process. Council Member Yiu brought up the aspect of fund raising, and how it would interact with the Healing Fund which already exists. City Attorney Berger pointed out that it would have to be distinct in its formation as a memorial fund. City Attorney Berger suggested the creation of an ad hoc committee to discuss the details of the process. Mayor Pro Tem Wong suggested gathering all the unknowns first to get answers regarding location(s) and cost.
Council Member Lo seconded the question of location. Interim City Manager Garcia spoke about the different aspects of the memorials given as examples to the Council regarding the structure of those memorial committees and selection of location(s). Mayor Sanchez pointed out the possibility of petitioning the state legislature for funds. The Mayor also encouraged continuing the discussion in the future.
Recommendation: It is recommended that the City Council consider; (1) Receiving and filing the staff report and attachments; (2) Discussing the establishment an independent Memorial Committee for the January 21st Mass Shooting Incident; (3) If desirable, providing additional staff direction; and (4) Taking such additional, related, action that may be desirable.
Action Taken: Discussion only, no action taken.
6. CITY COMMUNICATIONS (CITY COUNCIL)
6-A. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MONTEREY PARK, CALIFORNIA, DECLARING AND PROCLAIMING SEPTEMBER 15 THROUGH OCTOBER 15, 2023 AS NATIONAL HISPANIC HERITAGE MONTH
(REQUESTED BY MAYOR SANCHEZ)
Action Taken: The City Council adopted Resolution No. 2023- R75 of the City Council of the City of Monterey Park, California, declaring and proclaiming September 15 through October 15, 2023 as National Hispanic Heritage Month
71-XX
September 6, 2023
Motion: Moved by Mayor Sanchez and seconded by Council Member Yiu, motion carried by the following vote:
Ayes: Council Members: Lo, Wong, Yiu, Ngo, Sanchez
Noes: Council Members: None
Absent: Council Members: None
Abstain: Council Members: None
Recusal: Council Members: None
RESOLUTION NO. 2023-R75
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MONTEREY PARK, CALIFORNIA, DECLARING AND PROCLAIMING SEPTEMBER 15 THROUGH OCTOBER 15, 2023 AS NATIONAL HISPANIC HERITAGE MONTH
COUNCIL COMMUNICATION
Council Member Lo said he attended a workshop held at the Langley Center on August 19 by Peace and Compassion San Gabriel Valley on how to combat hate crime. Also in attendance was Los Angeles County District Attorney George Gascon. Council Member Lo also mentioned attending the Monterey Park (MPK) Hope Resiliency Center on August 21 at Sierra Vista Park, and a solidarity rally on August 25 at Garfield Medical Center in support of healthcare workers. Council Member Lo also asked for an update on resolutions passed in the last year to promote pedestrian-friendly areas in the City.
C
ouncil M ember Yiu talked about attending the grand opening of the Herald Christian Medical Center in El Monte on September 2, and spoke about how they have expanded their facilities since the pandemic to help underserved populations.
Council Member Yiu also spoke about meeting with students at the Bruggemeyer Library during their Educator Night event . On August 21, she said she attended the Chinatown Service Center opening of the MPK Hope Resiliency Center at Sierra Vista Park.
C
ouncil Member Ngo talked about attending the Monterey Park Police Department’s Annual Promotions event on August 17 th. Council Member Ngo conveyed that he attended the Asian-American Economic Development Enterprise Career Fair in Alhambra on August 18 , the Union Church Health Fair and Food giveaway event in the City of Monterey Park, the Monterey Park Manta Rays swim team awards banquet on August 15, the Monterey Park Hope Resiliency Center on August 21 at Sierra Vista Park , Back-to-School event on August 23 for the Garvey School District held at Garvey Middle School, and the Educator Night at the Bruggemeyer Library.
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September 6, 2023
Mayor Pro Tem Wong spoke about attending many of the same events alongside the other Council Members and took time to congratulate the Police O fficers who were promoted at the event on August 17. He congratulated the Manta Rays as well. He t hanked the Chinatown Service Center for their work on the Hope Resiliency Center and wanted to remind the community of the services offered there. Finally, he talked about the retirement of Helen Romero Shaw from Southern California Gas Company and noted her retirement party held at a local small business in the City of Monterey Park.
Mayor Sanchez mentioned that many on the Council attended the same events.
He talked about attending the Union Church Health Fair on August 19 and the Lions Club Dinner and commended the Lions Club for their work in the community during the pandemic. He also said he attended the Alhambra Teachers Association’s Welcome Back Breakfast on August 26 and the Alhambra City Council reorganization meetin g. He thanked former Mayor of Alhambra, Adele Andrade-Sadler for her service to the City of Alhambra and acknowledged the partnership with the City of Monterey Park. Mayor Sanchez acknowledged the new Mayor of Alhambra, Ross Maza and the new Vice Mayor, Sasha Renee Perez. He mentioned that he attended the Garfield Health Center for free flu shots on August
30. That same day, he attended the Joint Committee with Alhambra Unified School District, which was also attended by Interim City Manager Alvarez and Interim Assistant City Manager Garcia to discuss the District and City bringing students in to encourage civic engagement. He spoke about attending the solidarity rally with the healthcare workers at Garfield Medical Center and his participation at Educator Night at the Bruggemeyer Library. He also noted that October 5 is Latina Equal Pay Day and that the month of October is National Domestic Violence Awareness Month. Mayor Sanchez reminded the public that the Council Meeting on September 20 is cancelled.
7. FUTURE AGENDA ITEMS
8. CLOSED SESSION (IF REQUIRED; CITY ATTORNEY TO ANNOUNCE) None.
ADJOURNMENT
There being no further business for consideration, the meeting was adjourned at 10:32 p.m.
___________
Maychelle Yee
City Clerk
71-XX
MISSION STATEMENT
The mission of the City of Monterey Park is to provide excellent services to enhance the quality of life for our entire community
MINUTES
MONTEREY PARK CITY COUNCIL
FINANCING AUTHORITY (MPFA)
HOUSING AUTHORITY (MPHA)
GEOLOGIC HAZARD ABATEMENT DISTRICT (GHAD)
SUCCESSOR AGENCY (SA)
SPECIAL MEETING
SEPTEMBER 26, 2023
The City Council, the Financing Authority (MPFA), the Housing Authority (MPHA), the Geologic Hazard Abatement District (GHAD), and the Successor Agency (SA) of the City of Monterey Park held a Special Meeting of the Council in the Council Chamber, located at 320 West Newmark Avenue in the City of Monterey Park , Tuesday, September 26, 2023 at 7:00 p.m.
CALL TO ORDER:
Mayor Sanchez called the meeting to order at 7:02 p.m.
ROLL CALL:
City Clerk Maychelle Yee called the roll:
Council Members Present: Henry Lo, Vinh Ngo, Jose Sanchez, Thomas Wong, Yvonne Yiu
Council Members Absent: None
ALSO PRESENT: Interim City Manager Inez Alvarez, City Attorney Karl Berger, Interim Assistant City Manager Diana Garcia, Interim City Librarian Kristin Olivarez, Director of Public Works Shawn Igoe, Director of Recreation and Community Services Robert Aguirre, Community Development Director Jessica Serrano, Police Chief Scott Wiese, Water Utility Manager Frank Heldman, Deputy City Clerk Cindy Trang.
VIRTUALLY PRESENT: Director of Human Resources and Risk Manager Christine Tomikawa, Fire Chief Matt Hallock, Director of Finance Martha Garcia
AGENDA ADDITIONS, DELETIONS, CHANGES AND ADOPTIONS
None.
PUBLIC COMMUNICATIONS: None.
1. NEW BUSINESS
1-A. RESOLUTION APPROVING THE MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY AND THE MONTEREY PARK FIREFIGHTERS’
ASSOCIATION FOR THE TERM OF JULY 1, 2023 TO JUNE 30, 2025 Representatives of the City of Monterey Park (“City”) and MPFFA met and conferred to negotiate the terms and conditions of a new Memorandum of
71-XX
September 26, 2023
Understanding (“MOU”) regarding employment. The parties reached an agreement on an MOU effective July 1, 2023 to June 30, 2025.
Action Taken: The City Council adopted Resolution No. 2023-R76 approving a Memorandum of Understanding (“MOU”) between the City of Monterey Park and the Monterey Park Firefighters’ Association (“MPFFA”).
Motion: Moved by Mayor Pro Tem Wong and seconded by Council Member Yiu , motion carried by the following vote:
Ayes: Council Members: Lo, Yiu, Ngo, Wong, Sanchez
Noes: Council Members: None
Absent: Council Members: None
Abstain: Council Members: None
Recusal: Council Members: None
Resolution No. 2023-R76:
A RESOLUTION APPROVING THE MEMORANDUM OF UNDERSTANDING
FOR CONTRACT YEAR 2023 -2025 BETWEEN THE CITY OF MONTEREY PARK AND THE MONTEREY PARK FIREFIGHTERS’ ASSOCIATION
(“MPFFA”).
1-B. APPROVE THE NOTICE OF PUBLIC HEARING FOR WATER AND SEWER
RATE ADJUSTMENTS AND SET A PUBLIC HEARING DATE ON DECEMBER 6, 2023
In 2014, the City Council adopted Ordinance Nos. 2109 and 2110 adjusting the rates for water and sewer. These Ordinance s included a 10% to 15% increase in rates for a five- year period beginning September 2014. The ordinances also included an automatic reversal of utility rate charges effective August 2019 back to utility charges exiting in August of 2017. Since that time, several factors have changed: declines in water usage resulting from increased efficiency and an increase in operating cost due to inflat ion. A new comprehensive rate study was desirable.
On June 16, 2021, the Council authorized the City Manager to execute an agreement with HF&H Consultants, LLC (HF&H) for a Utility Rate Fees Study (the Study). The last comprehensive study on the water, wastewater, and refuse rates occurred in 2014.
Discussion: Interim City Manager Alvarez presented a PowerPoint presentation on the process for determining the water and sewer rate increase. Public Works Director Igoe made a presentation regarding the current water and sewer infrastructure and the need for a rate increase. Senior Vice-President of HF & H Consultants, Rick Simonson was in attendance virtually to elaborate on the rate study and analysis of the rate increase and took questions from the Council.
Director of Finance Garcia also participated in the discussion of the lifeline discount
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September 26, 2023
program for residents. Chief Executive and Strategy Officer of Urban Futures Bond Administration, Michael Busch talked about the financial aspect for the City and took questions from the Council.
Action Taken: The City Council (1) received and filed the Water and Sewer Rate Study; (2) established proposed water and sewer rates for customer consideration; (3) directed the Interim City Manager, or designee, to implement the Proposition 218 protest ballot process (pursuant to Resolution No. 11647) for proposed rate setting; and (4) set a Public Hearing on December 6, 2023 to consider rate increases.
Motion: Moved by Council Member Ngo and seconded by Mayor Pro Tem Wong, motion carried by the following vote:
Ayes: Council Members: Lo, Yiu, Ngo, Wong, Sanchez
Noes: Council Members: None
Absent: Council Members: None
Abstain: Council Members: None
Recusal: Council Members: None
RECESSED – 8:51 p.m.
2. CLOSED SESSION – 8:59 p.m.
2-A. CONFERENCE WITH LEGAL COUNSEL – EXISTING LITIGATION (GOVERNMENT CODE SEC. 54956.9(D)(1))
Name of Case: Shichen Mai v. City of Monterey Park, et al . (filed November 30, 2022) LSC Case No. 22AHCV01195.
2-B. CONFERENCE WITH LEGAL COUNSEL, INITIATION OF LITIGATION (Government Code § 54956.9(d)(4)).
Number of Potential Cases: One (related to Case No. 22AHCV01195, above). Potential Defendants (voluntarily disclosed; not legally required): West Coast Arborists, Inc. and Does 1-30.
RECONVENED – 9:02 p.m.
ADJOURNED
There being no further business for consideration, the meeting was adjourned at 9:02 p.m.
NO REPORTABLE ACTION TAKEN IN CLOSED SESSION
___
_______________
Maychelle Yee
City Clerk
City Council Staff Report
,
DATE: November 15, 2023
AGENDA ITEM NO:
TO: The Honorable Mayor and City Council
FROM: Maychelle Yee, City Clerk
SUBJECT: Amending Records Retention Schedule
RECOMMENDATION:
It is recommended that the City Council consider:
1. Adopting a Resolution amending the City's Records Retention Schedule for City documents; or
2. Taking such additional, related, action that may be desirable.
EXECUTIVE SUMMARY:
At its November 2, 2011 meeting, the City Council adopted Resolution N o. 11443, approving a Records Retention Schedule for City documents. Thereafter, every odd numbered year staff reviews the retention schedule for purposes of practicability and applicable law.
BACKGROUND:
The City Council adopted the retention schedule in 2011 which was revised in 2013, 2015, 2017, 2019, 2021 . The City Clerk’s office, working in collaboration with all City departments identified the need to update the current retention schedule to reflect the current codes and make minor corrections.
Exhibit "A" to the draft Resolution describes the proposed changes. The blue strikethrough texts are to be deleted and the pink unlined texts are to be added. The schedules and the table of content will be amended after the adoption to reflect the updates, moving the divisions to the corresponding departments, the correct page numbering, and amending the schedules to in clude optical disk as an option for preservation of records. The destruction of records procedure as prescribed in the Retention Schedule will remain in effect. The City Attorney reviewed and approved all schedules.
FISCAL IMPACT:
Destroying records in accordance with the Retention Schedule will generally reduce costs associated with records storage and retention. The exact amount is somewhat difficult to quantify.
Consent Calendar - 3B
Staff Report
November 15, 2023
Respectfully submitted by: Prepared by:
Maychelle Yee
City Clerk
Cindy H. Trang
Deputy City Clerk
Approved by:
Reviewed by:
Inez Alvarez
Interim City Manager
Karl H. Berger
City Attorney
ATTACHMENTS:
1. Draft Resolution and Exhibit A (proposed changes)
Staff Report
ATTACHMENT 1
Draft Resolution and Exhibit A (proposed changes)
RESOLUTION NO.
A RESOLUTION AMENDING THE CITY'S RECORDS
RETENTION SCHEDULE FOR CITY DOCUMENTS.
The City Council does resolve as follows:
SECTION 1: The City Council finds and declares as follows:
A. The City’s Retention Schedule was first adopted on November 2, 2011 and was subsequently amended in odd numbered years (the “Schedule”). Keeping and maintaining public records that are unnecessary or duplicative results in the consumption of significant public resources including money, time, and space;
B. Government Code §§ 34090, et seq. establish methods by which the City may approve the destruction of unneeded documents; and
C. It is in the public interest to reduce the City’s cost for storing documents while, at the same time, ensuring that the City preserves those records that are required to conduct City business.
SECTION 2: Pursuant to Government Code § 34090 , the City Council amends the Retention Schedule as shown in attached Exhibit “A,” which is incorporated by reference. The City Clerk is authorized to dispose of records according to the time intervals listed in that schedule upon the request of the City Manager, or designee, and the written approval of the City Attorney.
SECTION 3: Nothing in this Resolution is intended to, nor does it, amend the Schedule other than as set forth in Exhibit A. The City Clerk is directed to certify the adoption of this Resolution; record this Resolution in the book of the City’s original resolutions; and make a minute of the adoption of the Resolution in the City Council’s records and the minutes of this meeting.
SECTION 4: Electronic Signatures. This Resolution may be executed with electronic signatures in accordance with Government Code §16.5. Such electronic signatures will be treated in all respects as having the same effect as an original signature.
SECTION 5: This Resolution will become effective immediately upon adoption and will remain effective unless repealed or superseded.
Resolution No.
PASSED AND ADOPTED this 15 th day of November, 2023.
________________________________
Jose Sanchez, Mayor
ATTEST:
________________________________
Maychelle Yee, City Clerk
APPROVED AS TO FORM:
____________________________
Karl H. Berger, City Attorney
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) SS
CITY OF MONTEREY PARK )
I, Maychelle Yee, City Clerk of the City of Monterey Park, California, do hereby certify that the foregoing Resolution No. was duly adopted and passed at a regular meeting of the Monterey Park City Council on the 15 th day of
November, 2023 by the following vote:
Ayes: Council Members:
Noes: Council Members:
Abstain: Council Members:
Absent: Council Members:
Dated this 15
th day of November, 2023.
_________________________
Maychelle Yee, City Clerk
Monterey Park, California
Final RECORDS RETENTION SCHEDULE: CITY-WIDE STANDARDS Page CW-3 Office of
Record
(OFR)
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
Manag.
Services /
Finance
RS-153 Budgets - Adopted / Final Copies -
When No
Longer
Needed
Originals,
Refer to OFR
Mag, OD, Ppr Final must be filed with County Auditor; GC §34090.7, 40802, 53901
Manag.
Services /
Finance
RS-169 Cash Receipts Detail / Backup /
Accounts Receivable Detail / Refund
Detail
Copies -
When No
Longer
Needed
Originals,
Refer to OFR
Mag, Ppr All details sent to Finance; Refer to RS105, RS174, RS212; GC §34090.7
Originating
Dept.
RS-179 City Attorney Opinions Minimum 2
years
Minimum 2
years
Mag, Ppr City preference; GC §34090
Human
Resources /
Risk Mgmt.
RS-183 Claims Against Others (Damage to City
Property, etc.)
Copies -
When No
Longer
Needed
Originals,
Refer to OFR
Mag, OD, Ppr Department Preference; Covers various statute of limitations; CCP §§ 337 et seq.; GC §§ 911.2, 945.6,
34090, 34090.6; PC §832.5
Lead Dept. RS-189 Committees Internal - Attended by
employees: All Records
(e.g. Records Management Committee, In-
House Task Forces, etc.)
Completion +
2 years
Completion
+5 years
Mag, OD, Ppr Yes GC §34090
Originating
Dept.
RS-524 Cloud Database
Any service database that uses a cloud-
based system for storage, retrieval,
infomation e.g. Accela, NeoGov,
ActiveNet, GoMpk, GRM, Library
Management System, etc.
P P Mag, OD Must provide backup and recovery methods of cloud- based with the City Clerk's office; Prior to terminating services, must file an optical disk of the contents of the entire database with the City Clerk's office; GC §34090 Originating
Dept.
RS-525 Cloud Database - Drafts
Information, Notes, Draft Memoranda,
Worksheet, etc. used to enter into the
database to create an electronic record
When No
Longer
Needed
When No
Longer
Needed
Ppr Notes, draft memoranda, etc. used by reference for
filling in the actual electronic "record" is a preliminary draft and does not constitue a "record"; GC §34090
Originating
Dept.
RS-527 Electronic Records - Records generated
by the database based on information
entered into the system
Copies -
When No
Longer
Needed
P Ppr Applications, notes, draft memoranda, worksheets etc. used by reference for filling in the actual electronic
"record" is a preliminary draft and does not constitue a "record"; Records generated and stored in the
database are permanent; Printouts are disposable at
any time; GC §34090
MONTEREY PARK, CA Last Revised: August 18, 2021
EXHIBIT A
Final RECORDS RETENTION SCHEDULE: CITY-WIDE STANDARDS Page CW-5 Office of
Record
(OFR)
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
Originating
Dept.
RS-540 Department Files - Unsuccessful
Project / Program Working Files
Completion
Determination
+ 2 years
Completion
Determination
+ 2 years
Mag, Ppr Department preference; GC §34090
Originating
Dept.
RS-226 Drafts & Notes: Drafts that are revised
(retain upon approval of final version)
Not More Than
90 Days or
Upon Approval
of Final
Not More Than
90 Days or
Upon Approval
of Final
Mag, Ppr Consult the City Attorney to determine if a record is considered a draft. GC §§34090, 6252, 6254(a)
Originating
Dept.
RS-246 Emails
Active & Inactive (Separated)
2 years 2 years Mag, Ppr E-mails that have a material impact on business are saved outside the e-mail system by printing them out
and placing them in a file folder, or saving them
electronically; e-mail which serve no useful purpose to the City should be deleted from the system. Purge on
an ongoing bases E-mails that have met the retention
requirements.
Public Works
/ Engineering
RS-539 Employee Rideshare Transportation
Program
Application, Monthly Rideshare Card
Copies -
When No
Longer
Needed
Originals,
Refer to OFR
Mag, Ppr GC §34090
Originating
Dept.
RS-282 GIS Database / Data / Layers (both City-
wide and Specialized)
2 years 2 years Mag, OD The Lead Department should print out historical documents (or save source data) prior to replacing the
data, if they require the data or output for historical purposes; Department Preference (Preliminary
documents); GC §34090 et seq.
Originating
Dept.
RS-284 Grants (UNSUCCESSFUL Applications,
Correspondence)
2 years 2 years Mag, Ppr GC §34090
MONTEREY PARK, CA Last Revised: August 18, 2021
Final RECORDS RETENTION SCHEDULE: CITY CLERK Page CC-5 Office of
Record
(OFC)
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
City Clerk RS-328 Master Appointment List / Roster of
Elected and Appointed
2 years P Mag, OD, Ppr Yes Retained for Historical Value, GC §34090 City Clerk RS-334 Minutes
All Agencies Except for RS-148
2 years P Mag, OD, Ppr Yes GC §34090
City Clerk RS-337 Municipal Code Supplements (retain 1
copy of each supplement)
2 years P Mag, OD, Ppr Yes Department preference; GC §34090 City Clerk RS-342 Notice of Reorganization (City) 2 years 2 years Mag, Ppr GC §34090 City Clerk RS-343 Notice of Reorganization (Other Cities) When No Longer
Needed
When No
Longer
Needed
Mag, Ppr Non-Records
City Clerk RS-346 Oaths of Office / Installation of Officers - Elected and Appointed Officials
5 years P Mag, OD, Ppr Yes Department preference; Statute of Limitations: Public official misconduct is discovery of offense + 4 years,
retirement benefits is 6 years from last action; statewide guidelines propose Termination + 6 years; GC
§§36507, 34090; PC §§801.5, 803(c); 29 USC 1113
City Clerk RS-519 Oaths of Office
Board, Commission & Board members
Employees & Volunteers
2 years Separation +
2 years
Mag, OD, Ppr Yes Department preference; GC §34090
City Clerk RS-351 Ordinances 2 years P Mag, OD, Ppr No GC §34090 et. seq.
City Clerk
RS-388 Proclamations / Commendations /
Certificates / Recognitions (Council
requests)
2 years 2 years Mag, Ppr GC §34090, same as RS-134
City Clerk RS-400 Public Records Act Requests (PRA) 2 years 2 years Mag, Ppr GC §34090 City Clerk RS-522 Recordings / DVD-R of Council Meetings (Beginning 2007)
2 years P Tape (Mag),
OD
Department preference; Video recording of meetings
are only required for 90 days; See RS-407 for prior; GC §34090.7
Staffing Dept. RS-146 Recordings:
Audio Recordings of meetings
At least 30
days; after
Minutes are
Approved
At least 30
days; after
Minutes are
Approved
Tape (Mag),
OD
GC §54953.5
MONTEREY PARK, CA. Last Revised: August 18, 2021
DUPLICATE
Final RECORDS RETENTION SCHEDULE:
COMMUNITY AND ECONOMIC DEVELOPMENT
Page CD-1
Office of
Record
(OFR)
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
BUILDING
Community &
Economic /
Building
RS-103 Accessibility Hardship Applications,
Approvals & Denials, etc.
2 years P Mag, OD, Ppr Yes Department preference; GC §34090 Community &
Economic /
Building
RS-155 Building Permits / Building Address
Files - Permanent Documents
Applications,
Building Permits, Certificate
of Occupancy, Modification Requests /
Applications for Constructing Permits,
Administrative Modification Decisions,
Appeals & Appeal Decisions,
Inspection Construction Notices /
Inspection Notices
(correction notices, compliance orders,
stop work notices, etc.)
2 years P Mag, OD, Ppr Yes GC §34090; H&S §19850; CBC §104.7 Community &
Economic /
Building
RS-531 Building Permits / Building Address
Files - Documents
Applications, Final Inspection Approval,
Special Inspection Reports, Structural
Calculations, Energy Calculations, Lab
Test Reports, Structural Observation
Reports, Property Reports
2 years 2 years GC §34090
Community &
Economic /
Building
RS-156 Building Plan Checks
Commercials / Industrials
2 years 2 years Mag, Ppr Preliminary draft not retained in the ordinary course of business; GC §34090 et seq.
Community &
Economic /
Building
RS-529 Building Plan Checks
Residential
2 years 2 years Mag, Ppr CBC requires they be retained for at least completion + 180 days; H&S§19850; CBC §104.7; GC §34090
Community &
Economic /
Building
RS-157 Building Plans and Construction
Documents - Final - Single Family
Residential - SFR and Appurtenances
completion +2
years
completion +2
years
Mag, OD, Ppr CBC requires they be retained for at least completion + 180 days; H&S§19850; CBC §104.7; GC §34090
MONTEREY PARK, CA. Last Revised: August 18, 2021
Final RECORDS RETENTION SCHEDULE:
COMMUNITY AND ECONOMIC DEVELOPMENT
Page CD-2
Office of
Record
(OFR)
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
Community &
Economic /
Building
RS-158 Building Plans and Construction
Documents - Final - Industrial,
Commercial, Multi-Family Dwellings,
Places of Public Accommodation, Tenant
Improvements, Production Homes
(includes Hazardous Materials
Questionnaire, etc.)
2 years P Mag, OD, Ppr Yes Law requires for the life of the building except for residential buildings not over 2 stories; Statewide
guidelines propose 2 years for blueprints &
specifications; CBC §108.4.3.1; H&S§19850, GC
§34090
Community &
Economic /
Building
RS-543 Geotechnical and Soils Reports
Building Division (Only) Projects
5 years P Mag, OD, Ppr Yes GC §34090
Community &
Economic /
Building
RS-380 Plans - Requests & Permissions to
Receive Copies of Plans (to and from
architects)
2 years 2 years Mag, Ppr GC §34090
Community &
Economic /
Building
RS-485 Uniform Codes (Title 24) Superseded +
2 years
P Mag, OD, Ppr Yes GC §50022.6
MONTEREY PARK, CA. Last Revised: August 18, 2021
Final RECORDS RETENTION SCHEDULE:
COMMUNITY AND ECONOMIC DEVELOPMENT
Page CD-3
Office of
Record
(OFR)
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
Community
Economic /
Planning
RS-116 Annexations / Boundaries /
Consolidations / LAFCO
2 years P Mag, OD, Ppr Yes Land Records; GC §34090
Community &
Economic /
Planning
RS-257 Environmental Determinations:
Environmental Impact Reports (EIRs),
Negative Declarations, Notice of
Exemptions etc.
5 years P Mag, OD, Ppr Yes Usually filed in the project file; Final environmental determinations are required to be kept a "reasonable
period of time"; 14 CCR §15095(c); GC §34090
Community &
Economic /
Planning
RS-279 General Plan, Elements and
Amendments
5 years P Mag, OD, Ppr Yes Department preference; GC §34090 Community &
Economic /
Planning
RS-278 General Plan - Working Files 5 years 5 years Mag, OD, Ppr Preliminary drafts; GC §34090 Community &
Economic /
Planning
RS-314 Land Use Studies / Plans / Reports 5 years P Mag, OD, Ppr Yes Department preference; GC §34090 Community &
Economic /
Planning
RS-329 Master Plans, Specific Plans, Bikeway
Plans, etc.
5 years P Mag, OD, Ppr Yes Department preference; GC §34090 Community &
Economic /
Planning
RS-378 Planning Project Files - Permanent
Entitlements -
Incomplete or Withdrawn
2 years 2 years Mag, Ppr Department preference; GC§§34090, 34090.7
PLANNING
MONTEREY PARK, CA. Last Revised: August 18, 2021
Final RECORDS RETENTION SCHEDULE:
COMMUNITY AND ECONOMIC DEVELOPMENT
Page CD-4
Office of
Record
(OFR)
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
Community &
Economic /
Planning
RS-379 Planning Project Files - Permanent
Entitlements
Approved, Denied or Expired
(Includes Associated Conditions of
Approval, Environmental Determinations,
Staff Reports, Plans & Maps)
Examples: Conditional Use Permits
(CUPs), Design Review, Lot Line
Adjustments, Parcel Maps, Site Plans,
Tentative Subdivisions, Variances, Zone
Changes, Master Sign Programs, etc.
Project
Completion
P Mag, OD, Ppr Yes Department maintains complete files for administrative purposes; Final environmental determinations are
required to be kept a "reasonable period of time"; 14
CCR §15095(c); GC§§34090, 34090.7
Community &
Economic /
Planning
RS-382 Preliminary Review File (No Final
Application)
When No
Longer
Needed
When No
Longer
Needed
Mag, Ppr Department preference; Preliminary Documents (no application submitted); GC §34090
Community &
Economic /
Planning
RS-391 Project Log Index / Spreadsheet /
Binders of Historic Actions
5 years P Mag, OD, Ppr Yes Department preference; GC §34090 Community &
Economic /
Planning
RS-452 Special Studies (Not related to a specific
project)
5 years P Mag, OD, Ppr Yes Department preference; GC §34090 MONTEREY PARK, CA. Last Revised: August 18, 2021
Final RECORDS RETENTION SCHEDULE:
COMMUNITY AND ECONOMIC DEVELOPMENT
Page CD-5
Office of
Record
(OFR)
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
Community &
Economic /
Planning
RS-544 Short Term Rental Permits Closed + 2
years
Closed + 2
years
Mag, Ppr GC§§34090
Community &
Economic /
Planning
RS-470 Temporary Use Permits / Special Use
Permits / Temporary Entitlements:
Christmas Tree Lots, Fireworks, Banners,
Pumpkin Lots, Outdoor Events, etc.
2 years 2 years Mag, Ppr Temporary uses; Department maintains complete files for administrative purposes; GC§§34090
Community &
Economic /
Planning
RS-545 Yard Sale Permits 2 years 2 years Mag, Ppr GC§§34090 Community &
Economic /
Planning
RS-515 Zoning - Maps of Significant Historical
Value
5 years P Mag, OD, Ppr Yes Department Preference; City Clerk Maintains originals of all documents that were presented to Council; GC
§34090.7
MONTEREY PARK, CA. Last Revised: August 18, 2021
Final RECORDS RETENTION SCHEDULE - FIRE Page FD-1
Office of
Record
(OFR)
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
EMERGENCY MEDICAL SERVICES
Fire / EMS RS-105 Accounts Receivable: Income from
Transport, Cash In /Cash Out
5 years 5 years Mag, OD, Ppr Yes Department preference; GC §34090
DUPLICATE
Fire / EMS RS-249 EMS Complaints / CQI (Continuous
Quality Improvement) / Quality Assurance
3 years 3 years Mag, OD, Ppr Statute of Limitations for health providers is 3 years; 13 CCR 1100.7, CFC, Section 104.6, 104.6.4, GC §34090
Fire / EMS RS-250 EMS Database P P Mag, OD Data is interrelated; GC §34090 Fire / EMS RS-291 HIPAA Policies and Procedures (Health Insurance Portability and Accountability
Act)
Superseded +
6 years
Superseded +
6 years
Mag, OD, Ppr Yes 24 CFR 164.530(j)
Fire / EMS RS-353 Paramedic / Ambulance Membership
Subscriptions
Termination of
Subscription +
5 years
Termination of
Subscription +
5 years
Mag, OD, Ppr Yes Department preference (meets municipal government auditing standards); GC §34090
Fire / EMS RS-357 Patient Care Reports / PCRs /
Paramedic Release Forms (EMS
transportation): ALL (medical and non-
medical.)
3 years Age 18 + 2
years
Mag, OD, Ppr Yes Department preference; 10 years is recommended by AHIMA for "healthcare providers"; California
Healthcare Association recommends Acute Care
Facilities retain adult records for ten years following discharge; Juvenile records are required until patient
becomes 18 years old; law requires 7 years for clinics, health facilities, hospitals, adult day health care
centers, and in-home skilled nursing services, and is
actually based upon "if the licensee ceases operations"; Statute of Limitations for health providers is 3 years; Federal law requires 3 years, statewide guidelines
propose 3 years; HIPAA provides privacy regulations
for patient's health records; 13 CFR 1100.7, CCP
§340.5, GC §34090; H&S §123145
Fire / EMS RS-434 Requests for Copies - EMS Reports 2 years 2 years Mag, Ppr GC §34090 MONTEREY PARK, CA. Last Revised: August 18, 2021
Final RECORDS RETENTION SCHEDULE: HUMAN RESOURCES Page HR-2 (OFR) Office
of Record
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
Human
Resources
RS-258 Equal Opportunity Employment -
Complaints / Department of Fair
Employment & Housing (DFEH or EEOC)
Claims
Separation +
7 years
Separation +
7 years
Mag, OD, Ppr Yes Department preference; All State and Federal laws require retention until final disposition of formal
complaint; State requires 2 years after "fully and finally disposed"; 2 CCR 7287.0; GC §§12946, 34090; CCP
§342; GC §§ 911.2, 945
Human
Resources
RS-259 Equal Opportunity Employment - EEOC
Re
ports (EEO-4 Reports)
3 years 3 years Mag, OD, Ppr 29 CFR 1602.30; 29 CFR 1602.32 Human
Resources
RS-311 Job Descriptions Minimum 3
years
Minimum 3
years
Mag, Ppr Yes Department preference; EEOC/FLSA/ADEA (Age) requires 3 years for promotion, demotion, transfer,
selection, or discharge; State Law requires 2 -3 years; retirement benefits is 6 years from last action; 29 CFR 1602.31 & 1627.3(b)(2), 8 CCR §3204(d)(1) et seq.,
GC §§12946, 34090; 29 USC 1113
City Clerk RS-436 MOUs (copies)
Set by Resolutions
Copies -
When No
Longer
Needed
Refer to OFR Mag, OD, Ppr GC §34090.7
Human
Resources
RS-339 Negotiation Binders / Notes, Side
Letters, Corres
pondence, etc.
5 years 10 years Mag, OD, Ppr Yes Department preference; GC §34090 Human
Resources
RS-371 Personnel Files - All Employees
Includes background checks from PD, and
all training certificates (including Ethics
Training Certificates)
Separation +
1 year
Separation +
7 years
Mag, OD, Ppr Yes Department preference; EEOC/FLSA/ADEA (Age) requires 3 years for promotion, demotion, transfer,
selection, or discharge; State Law requires 2 -3 years; retirement benefits is 6 years from last action; 29 CFR 1602.31 & 1627.3(b)(2), 8 CCR §3204(d)(1) et seq.,
GC §§12946, 34090; 53235.2(b); 29 USC 1113; CC §
1786.18 (ICRAA)
Human
Resources
RS-372 Personnel Files - Medical Records (all
employees)
Separation +
1 year
Separation +
30 years
Mag, OD, Ppr Yes Department preference; Files maintained separately; Claims can be made for 30 years for toxic substance
exposure; 8 CCR §3204(d)(1) et seq., GC §§12946,
34090, 29 CFR 1910.1020(d)(1)(i)
Human
Resources
RS-546 Employee Accident Reports Separation +
1 year
Separation +
30 years
Mag, OD, Ppr Yes Department preference; Files maintained separately; Claims can be made for 30 years for toxic substance
exposure; 8 CCR §3204(d)(1) et seq., GC §34090, 29
CFR 1910.1020(d)(1)(i)
MONTEREY PARK, CA Last Revised: August 18, 2021
Final RECORDS RETENTION SCHEDULE: HUMAN RESOURCES Page HR-5 (OFR) Office
of Record
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
Human
Resources /
Risk Mgmt
RS-514 Workers' Compensation or Disability
Claims / Employee Accident Reports
Denied Claims
Includes all Accident, Incident, or Injury
Reports and associated MSDS, Refusal of
Medical Treatment of an Industrial
Accident
Until Closed Separation +
30 years
Settled + 5
years
Mag,
OD, Ppr Yes Department preference; Claims can be made for 30 years for toxic substance exposure; Claims are required for five years after the end of compensation, or injury, whichever is longer; 8 CCR §3204(d)(1) et seq., 8 CCR
10102, 15400.2; GC §§12946, 34090
MONTEREY PARK, CA Last Revised: August 18, 2021
Final RECORDS RETENTION SCHEDULE: INFORMATION TECHNOLOGY Page IT-1 Office of
Record
(OFR)
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper After
Imaged &
QC'd?
Comments / Reference
Information
Technology
RS-135 City Backup Tapes / Disks - Daily
City applications, User files, Financial
data, etc. (RS-263)
2 1 weeks 2 1 weeks Mag, OD Used for Disaster Recovery Purposes Only. Backups are done for Mondays through Fridays. Retention
schedule is for two weeks. Monthly backup is also
performed for finance and payroll data and retention is for one year.
Information
Technology
RS-136 City Backup Tapes / Disks - Weekly
City applications, User files, Financial
data, etc. (RS-263)
2 weeks 2 weeks Mag, OD Used for Disaster Recovery Purposes Only; Tuesday tapes are stored off-site and tapes are re-used bi-
weekly; GC §34090 et seq.
Information
Technology
RS-340 Network Configuration Maps & Plans When No
Longer
Needed
When No
Longer
Needed
Mag, OD, Ppr GC §34090 et seq. Current network layout is available in Finance.
Information
Technology
RS-448 Software Licenses, Warranties,
Installation Media
When No
Longer
Needed
When No
Longer
Needed
Mag, OD GC §34090 et seq. Software licenses, warranties, and media are retained by IT until they are no longer
needed.
MONTEREY PARK, CA Last Revised: August 18, 2021
Final RECORDS RETENTION SCHEDULE - LIBRARY Page LB-1
Office of
Record
(OFR)
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
Library RS-223 Disruptive Patrons / Patron Complaints
/ Incident Reports
2 years 2 years Mag, Pp r Department preference; GC §34090 Library RS-286 Grants: LSCA (Library Services and
Construction), LSTA (Library Services and
Technology), IMLS (Institute of Museum &
Library Services),
WIOA (Workforce
Innovation Opportunity Act) and PLF
(Public Library Foundation) ONLY. For all
others, follow City-wide Schedule.
(SUCCESSFUL Reports, and Financial
Information)
Final
Expenditure +
5 years
Final
Expenditure +
5 years
Mag, OD, Ppr Yes Per California State Library Records Management Program Requirements (April 27, 1998); GC §34090
Library RS-304 Inter-Library Loan Records - Reports to
the State Library (for reimbursement)
5 years 5 years Mag, OD, Ppr Yes Department preference to ensure reimbursements; GC §34090
Library RS-307 Internet User Statistics 2 years 2 years Mag, Pp r GC §34090 Library RS-318 Library Management System /
Database, Card Catalogue
1 week 1 week Mag, OD Yes Data Fields / Records are interrelated; Backup Tapes/Disks used for Disaster Recovery Purposes
Only; Tuesday tapes are stored off-site and tapes are
re-used weekly; GC §34090 et seq.
Library RS-359 Patron Applications for Library Cards 2 years 2 years Mag, Ppr GC §34090 Library RS-356 Passport - Transmittal Forms, Receipts
Books, Calendar
2 years 2 years Ppr GC §34090 et. seq.
Library RS-389 Program Sign Ups (e.g. Summer
Reading)
2 years 2 years Mag, Pp r GC §34090
MONTEREY PARK, CA. Last Revised: August 18, 2021
Final RECORDS RETENTION SCHEDULE: MANAGEMENT SERVICES Page MS-1 Office of
Record
(OFC)
Retention
No. Records Description Active
(in office)
Total
Retention
Media
Options
Destroy
Paper after
Imaged &
QC'd?
Comments / Reference
Manag.
Services /
Finance
RS-129 Assessment District 93-1 and Library
Tax Annual Renewal Reports, Assessment
Roll Reports
5 years 5 years Mag, OD, Ppr Ye s GC §34090
Manag.
Services /
Finance
RS-131 Audit Reports / CAFR / Single Audits 5 years P Mag, OD, Ppr Ye s GC §34090 Manag.
Services /
Finance
RS-132 Audit Work Papers / Audit Schedules 2 years 5 years Mag, Ppr G C §34090 Manag.
Services /
Finance
RS-137 Bank Statements / Reconciliation Work
Papers / Fiscal Agent Statements
2 years 5 years Mag, OD, Ppr Ye s GC §34090
Manag.
Services /
Finance
RS-151 Bonds: Debt Official Statements /
Certificates of Participations (COPs)
Other City Financing & Work papers
Cancellation,
Redemption
or Maturity +
10 years
Cancellation,
Redemption
or Maturity +
10 years
Mag, OD, Ppr Yes Statute of Limitations for bonds, mortgages, trust deeds, notes or debentures is 6 years; Bonds issued by
local governments are 10 years; There are specific
requirements for disposal of unused bonds; CCP
§§336(a)(1) & (2), 337.5(2); GC §43900 et seq.
Manag.
Services /
Finance
RS-153 Budgets - Adopted / Final 5 years P Mag, OD, Ppr Ye s GC §34090, 40802, 53901 Manag.
Services /
Finance
RS-181 City Investment Report - Quarterly &
Annually
3 years 3 years Mag, Ppr GC §34090
Manag.
Services /
Finance
RS-263 Financial Services Database
(Refer to IT, RS-135, RS-136)
Refer to IT Refer to IT Mag, OD Refer to IT Retention Policy; GC §34090
FINANCE/MANAGEMENT
MONTEREY PARK, CA. Last Revised: August 18, 2021
City Council Staff Report
DATE: November 15, 2023
AGENDA ITEM NO:
TO: The Honorable Mayor and City Council
FROM: Amy Lee, City Treasurer
SUBJECT: Monthly Investment Report – October 2023
RECOMMENDATION:
It is recommended that the City Council consider:
1. Receiving and filing the monthly investment report; and
2. Taking such additional, related, action that may be desirable.
EXECUTIVE SUMMARY:
As of October 31, 202 3, invested funds for the City of Monterey Park total $64,079,482.93.
BACKGROUND:
In accordance with the City’s Investment Policy, a monthly investment report is presented to the City Council showing the types of investments, dates and maturities, amounts of deposits, rates of interest, and the current market values for securities with maturity more than 12 months. The attached monthly investment report includes a summary investment report for the LA County Pooled Investment Fund, which displays the composition by type for the entire pooled investment fund.
Respectfully submitted by: Prepared by:
Amy Lee
City Treasurer
Martha Garcia
Finance Director
Approved by:
Inez Alvarez
Interim City Manager
ATTACHMENT:
1. Monthly Investment Report
Consent Calendar - 3C
Staff Report
November 15, 2023
ATTACHMENT 1
Monthly Investment Report
INVESTMENTS PORTFOLIO PROFILE:
TOTAL BALANCE AT 10/31/2023 64,079,482.93$
INVESTMENT COMPOSITION
(1) LA COUNTY POOLED INVESTMENT FUND ON DEMAND 3.850% 44,286,379.34$ (See Schedule A for LA County Pool Composition)
(2) LOCAL AGENCY INVESTMENT FUND ON DEMAND 3.150% 11,948,103.59$ Purchase Maturity Interest
(3) CERTIFICATES OF DEPOSIT Date Date Rate
1 SALLIE MAE BANK 08/11/21 08/12/24 0.70% 245,000
2 TOYOTA FINANCIAL SAVINGS BANK 09/16/21 09/16/24 0.65% 245,000 3 SYNCHRONY BANK 09/17/21 09/17/24 0.65% 245,000
4 UBS BANK USA 09/22/21 09/23/24 0.65% 245,000
5 STATE BANK OF INDIA 10/18/21 10/18/24 0.70% 245,000
6 MEDALLION BANK UTAH 01/28/22 01/28/25 1.25% 245,000
7 PENTAGON FEDERAL UNION 01/31/22 01/31/25 1.25% 245,000 8 BEAL BANK 02/02/22 01/29/25 1.15% 245,000
9 VALLIANCE BANK 03/18/22 03/18/25 1.40% 245,000
10 STATE BANK OF TEXAS 03/25/22 03/25/25 1.45% 245,000 11 FIRST FED SAVINGS & LOAN 03/30/22 03/31/25 2.00% 245,000 12 LAFAYETTE FEDERAL CREDIT UNION 03/30/22 03/31/25 2.20% 245,000 13 ALLY BANK 03/31/22 03/28/24 1.95% 245,000
14 COMENITY CAPITAL BANK 04/14/22 04/14/25 2.55% 245,000 15 AMERICU CREDIT UNION 04/21/22 04/21/25 2.30% 245,000 16 BALBOA THRIFT & LOAN 04/29/22 04/29/25 2.00% 245,000 17 CONNEXUS CREDIT UNION 05/26/22 05/28/24 2.65% 245,000 18 METRO CREDIT UNION 07/13/22 07/12/24 3.20% 245,000
19 FIRST TECHNOLOGY CREDIT UNION 08/05/22 08/05/24 3.25% 245,000 20 AUSTIN TELCO FEDERAL CREDIT UNION 12/16/22 12/16/24 5.00% 245,000 21 GREENWOOD MUNICIPAL FED CREDIT UNION 01/27/23 01/27/25 4.80% 245,000 22 RAIZ CREDIT UNION 01/27/23 01/27/25 4.75% 245,000
23 WORKERS 01/27/23 01/27/25 4.70% 245,000
24 MANUF & TRADERS TRUST CO 01/31/23 01/31/26 4.25% 245,000 25 ALPINE BANK 01/31/23 01/31/25 4.55% 245,000
26 TECHNOLOGY FCU 02/10/23 02/24/25 5.00% 245,000
27 RED CROWN FCU 02/14/23 02/21/25 4.85% 245,000
28 UFIRST FEDERAL CREDIT UNION 02/15/23 02/25/25 4.85% 245,000 29 SEA COMM FEDERAL CREDIT UNION 02/23/23 03/03/25 4.90% 245,000 30 GLOBAL CREDIT UNION 05/02/23 05/12/25 4.85% 245,000 31 WESTERN ALLIANCE BANK 05/02/23 05/05/25 4.85% 245,000 32 PREFERRED BANK 09/03/23 09/03/24 4.16% 100,000
33 PREFERRED BANK 09/08/23 09/08/24 4.16% 150,000
Total CDs (33) 3.254% 7,845,000.00$
OTHER INFORMATION:
BANK BALANCE: (1)
$4,600,364.02
AVERAGE MATURITY DAYS 58
AVERAGE INTEREST RATE FOR THE MONTH 3.540%
THE CITY'S INVESTMENT HAS SUFFICIENT LIQUIDITY TO MEET THE CITY'S EXPENDITURE REQUIREMENTS FOR THE NEXT 180 DAYS. THE 180-DAY LIQUIDITY DISCLOSURE IS REQUIRED PER GOVERNMENT CODE 53646.
THERE HAVE BEEN NO VARIANCES TO THE INVESTMENT POLICY.
(1) Bank balance is maintained to cover outstanding warrants, payroll checks and on-going operating costs.
CITY OF MONTEREY PARK
INVESTMENT REPORT
OCTOBER 31, 2023
City Council Staff Report
DATE: November 15, 2023
AGENDA ITEM NO:
TO: The Honorable Mayor and City Council
FROM: Martha Garcia, Director of Finance
SUBJECT: Resolution Adopting the Recognized Obligation Payment Schedule and Administrative Budget for July 1, 2024 – June 30, 2025
RECOMMENDATION:
It is recommended that the City Council consider:
1. Adopting a resolution approving the Recognized Obligation Payment Schedule (ROPS 24-25 A&B) for the period between July 1, 2024 – June 30, 2025; and
2. Approving the Successor Agency Administrative Budget for July 1, 2024 – June 30, 2025; and
3. Directing staff to post and transmit the ROPS and Administrative Budget to the appropriate public agencies; and
4. Taking such additional, related, action that may be desirable.
EXECUTIVE SUMMARY:
Existing law requires the Monterey Park Successor Agency (SA) to formulate Recognized Obligation Payment Schedules (ROPS) under which the SA makes payments for eligible obligations of the former Redevelopment Agency. The ROPS are considered by the Successor Agency Board, proposed to the Oversight Board (OB) and, if approved by the OB, provided to the California Department of Finance for review.
The ROPS is required to be prepared for an entire 12 months. Staff requests that the City Council, acting on behalf of the SA for the former Monterey Park Redevelopment Agency, consider and adopt the ROPS 24-25 A&B and the related administrative budget for the period covering July 1, 2024 – June 30, 2025.
BACKGROUND:
ROPS 24-25 A&B has no new line items and requests an amount of $2,431,804 including an administrative budget of $190,000 for the period of July 1, 2024 through June 30, 2025.
To meet the deadlines for disbursement of funds from the County of Los Angeles, both the SA and the OB must approve the ROPS and submit it to the Department of Finance by January 31, 2024.
Consent Calendar - 3D
Staff Report
November 15, 2023
The First District Consolidated Oversight Board is scheduled on January 8, 2024 to review the ROPS as well as the administrative budget after the SA’s approval. The deadline for the Successor Agency to the First District Consolidated Oversight Board is December 18, 2023.
FISCAL IMPACT:
All monies received from the request made on the ROPS go into the account of the Successor Agency for obligations of the former Redevelopment Agency.
Respectfully prepared and submitted by:
Martha Garcia
Director of Finance
Approved by:
Reviewed by:
Inez Alvarez
Interim City Manager
Karl H. Berger
City Attorney
ATTACHMENT:
1. Resolution ROPS 24-25 A&B
ATTACHMENT 1
Resolution ROPS 24-25 A&B
Staff Report
November 15, 2023
RESOLUTION NO. SA- ___
A RESOLUTION OF THE SUCCESSOR AGENCY TO THE
MONTEREY PARK REDEVELOPMENT AGENCY ADOPTING
RECOGNIZED OBLIGATION PAYMENT SCHEDULES PURSUANT
TO HEALTH AND SAFETY CODE § 34177.
The City Council, acting on behalf of the Successor Agency to the Monterey Park Redevelopment Agency (“Successor Agency”), does resolve as follows:
SECTION 1: The City council finds and declares that:
A. On June 29, 2011, AB 1X 26 and AB 1 X 27 became effective, requiring that each redevelopment agency within California be dissolved unless the community that created it enacts an ordinance committing it to making certain payments;
B. On December 29, 2011, the California Supreme Court issued a decision in California Redevelopment Association v. Matosantos (2011) 53 Cal. 4
th 231 largely upholding AB 1 X 26, invalidating AB 1X
27 as unconstitutional, and holding that AB 1X 26 may be severed from AB 1X 27 and enforced independently;
C. As a result of the Supreme Court’s decision, the Monterey Park Redevelopment Agency (the “redevelopment agency”), created pursuant to the Community Redevelopment Law, was dissolved pursuant to AB 1X 26 on February 1, 2012;
D. By its Resolution No. 11455 adopted on January 11, 2012, the City Council of the City of Monterey Park chose to act on behalf of the successor agency for the Redevelopment Agency (the “Successor Agency”); and
E. In adopting this Resolution for t he Successor Agency, the City Council approves the Recognized Obligation Payment Schedule (designated as ROPS 24-25 A&B by the California Department of Finance) on behalf of the Successor Agency for the period from July 1, 202 4 through June 30, 2025.
SECTION 2: Recognized Obligation Payment Schedules . The City Council adopts ROPS 24-25 A&B attached as Exhibit “A” to this Resolution and incorporated by reference. The City Council also adopts the Administrative Budget attached as Exhibit “B” to this Resolution and incorporated by reference.
Resolution No. SA–___
SECTION 3: Authorization. The City Manager, or designee, acting on behalf of the Successor Agency is authorized and directed, jointly and severally, to implement this Resolution including, without limitation, providing documents associated with the ROPS 24-25 A&B to the Oversight Board, City Council, Department of Finance, county Controller and (if applicable) State Controller. The City Manager, or designee, is the official whom the Department of Finance may make requests for review in connection with the ROPS 24-25 A&B.
SECTION 4: Amendment. The ROPS may be amended from time-to-time at any public meeting of the City Council acting on behalf of the Successor Agency.
SECTION 5: Environmental Determination. This Resolution is exempt from review under the California Environmental Quality Act (California Public Resources Code §§ 2100, et seq., “CEQA”) and CEQA regulations (14 California Code of Regulations §§ 15000, et seq.) because it establishes rules and procedures to implement government funding mechanisms; does not involve any commitment to a specific project which could result in a potentially significant physical impact on the environment; and constitutes an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. Accordingly, this Resolution does not constitute a “project” that requires environmental review (see specifically 14 CCR § 15378(b)(4-5)).
SECTION 6: Reliance on Record. Each and every one of the findings and determinations in this Resolution are based on the competent and substantial evidence, both oral and written, contained in the entire record relating to the Successor Agency and applicable law. The findings and determinations constitute the independent findings and determinations of the City Council in all respects and are fully and completely supported by substantial evidence in the record as a whole.
SECTION 7: Summaries of Information. All summaries of information in the findings, which precede this Section, are based on the substantial evidence in the record including, without limitation, verbal and documentary evidence submitted to the Successor Agency. The absence of any particular fact from any such summary is not an indication that a particular finding is not based in part on that fact.
SECTION 8: Electronic Signatures. This Resolution may be executed with electronic signatures in accordance with Government Code §16.5. Such electronic signatures will be treated in all respects as having the same effect as an original signature.
SECTION 9: The Secretary is directed to certify the adoption of this Resolution; record this Resolution in the book of the SA’s original resolutions; and make a minute of the adoption of the resolution in the Successor Agency’s records and the minutes of this meeting.
Resolution No. SA–___
SECTION 10: Effective Date. This Resolution will become effective immediately upon adoption and will remain effective unless repealed or superseded.
PASSED, APPROVED, AND ADOPTED this 15th day of November 2023. ______________________________
Jose Sanchez, Mayor
ATTEST:
___________________________
Maychelle Yee, City Clerk
APPROVED AS TO FORM:
_________________________________
Karl H. Berger, City Attorney
)
) §.
Resolution No. SA–___
State of California County
of Los An geles Ci ty of
Monterey Park )
I, Maychelle Yee, hereby certify that the above foregoing Resolution No.
SA- ____ was duly passed and adopted by the City Council acting on behalf of the Successor Agency to the former Redevelopment Agency at a regular meeting held on the 15th day of November, 2023 by the following vote:
Ayes: Council Members:
Noes: Council Members:
Absent: Council Members:
Abstain: Council Members:
Recusal: Council Members:
Dated this 15
th day of November, 2023
______________________________
Maychelle Yee, City Clerk
Monterey Park, California
Exhibit A
Monterey Park
ROPS 2024-25 Annual
Requested Funding for Obligations 24-25A Total 24-25B Total ROPS Total A Obligations Funded as Follows (B+C+D) 0 0 0
B Bond Proceeds 0 0 0
C Reserve Balance 0 0 0
D Other Funds 0 0 0
E
Redevelopment Property Tax Trust Fund
(RPTTF) (F+G) 1,181,153 1,250,651 2,431,804
F RPTTF 1,086,153 1,155,651 2,241,804
G Administrative RPTTF 95,000 95,000 190,000
H Current Period Obligations (A+E) 1,181,153 1,250,651 2,431,804
Exhibit A
Monterey Park ROPS 2024-25 Annual
Item # Obligation Name Obligation Type
Agreement
Execution
Date
Agreement
Termination
Date Payee Description
Total
Outstanding
Obligation
Total
Requested
Funding
1 Successor Agency Administration Costs Admin Costs 1/1/2014 7/12/2034 Successor Agency Successor Agency Administration Costs - labor and overhead 35,706,622 190,000 28 Housing Fund Repayment of SERAF Loan LMIHF Loans 8/4/2010 6/30/2016 Housing Successor Agency Housing Fund Repayment of SERAF Loan 827,664 137,342 29 Repayment of Housing Loan Obligation LMIHF Loans 5/19/1997 6/30/2039 Housing Successor Agency Housing Fund Repayment for Outstanding Loan 1,186,222 100,000 31 Atlantic-Garvey Tax Allocation Refunding Bonds, 2013A Bonds Issued On or Before 12/31/10 12/24/2013 9/1/2026 US Bank Bonds issued to advance refund the 2002 Tax Allocation Bonds 3,313,802 1,345,731 32 Trustee Fees for Merged Tax Allocation Refunding Bonds, 2013B Bonds Issued On or Before 12/31/10 12/24/2013 9/1/2028 US Bank Fees for Trustee of Refunding Bonds 21,250 1,000 33 Trustee Fees for Atlantic-Garvey Tax Allocation Refunding Bonds, 2013A Bonds Issued On or Before 12/31/10 12/24/2013 9/1/2026 US Bank Fees for Trustee of Refunding Bonds 22,620 1,000 36 Merged Tax Allocation Refunding Bonds, 2013B Bonds Issued After 12/31/10 12/24/2013 9/1/2028 US Bank Bonds issued to advance refund the 1998 Tax Allocation Bonds 2,940,765 656,731 2,431,804
Exhibit A and B ROPS 2024-25.xlsx
Exhibit A
A B C D E F G H
Reserve Balance Other Funds RPTTF
Bonds issued on or
before 12/31/10
Bonds issued on or
after 01/01/11
Prior ROPS RPTTF
and Reserve
Balances retained for
future period(s)
Rent,
Grants,
Interest, etc.
Non-Admin
and
Admin
1 Beginning Available Cash Balance (Actual 07/01/21)
RPTTF amount should exclude "A" period distribution amount 0 2 Revenue/Income (Actual 06/30/22)
RPTTF amount should tie to the ROPS 21-22 total distribution from the County Auditor-Controller
2,434,931
3 Expenditures for ROPS 21-22 Enforceable Obligations
(Actual 06/30/22)
2,434,931
4 Retention of Available Cash Balance (Actual 06/30/22) RPTTF amount retained should only include the amounts distributed as reserve for future period(s)
5 ROPS 21-22 RPTTF Prior Period Adjustment
RPTTF amount should tie to the Agency's ROPS 21-22 PPA form submitted to the CAC
6 Ending Actual Available Cash Balance (06/30/22)
C to F = (1 + 2 - 3 - 4), G = (1 + 2 - 3 - 4 - 5)
0$ 0$ 0$ 0$ 0$ No entry required
Monterey Park Recognized Obligation Payment Schedule (ROPS 24-25) - Report of Cash Balances July 1, 2021 through June 30, 2022
(Report Amounts in Whole Dollars)
Pursuant to Health and Safety Code section 34177 (l), Redevelopment Property Tax Trust Fund (RPTTF) may be listed as a source of payment on the ROPS, but only to the extent no other funding source is available or when payment from property tax revenues is required by an enforceable obligation. For tips on how to complete the Report of Cash Balances Form, see Cash Balance Tips.
ROPS 21-22 Cash Balances
(07/01/21 - 06/30/22)
Fund Sources
Comments
Bond Proceeds
Exhibit B
City of Monterey Park
Successor Agency Administrative Costs
7/1/2024 - 6/30/2025
ROPS Item # 1
ROPS 24-25 A&B
Source of 12-Month Period
Name Payment Total
Successor Agency
Direct Project Management Cost
Salaries: RPTTF
ROPS documents preparation, filing, audits and other misc. 40,000 Accountant
Finance Manager
Director of Finance
Agreements, resolutions, meetings RPTTF 50,000
Administrative Secretary
Finance Manager
Director of Finance
City Clerk
City Attorney
City Manager
Total Direct Project Management Cost 90,000
Administrative Cost
Insurance and Benefits RPTTF 22,000
OPEB Obligations, Pension Charges RPTTF 12,000
Office Supplies (paper/toners/ink) RPTTF 1,000
Postage / Messenger Service / Telephone RPTTF 1,000
Legal Services RPTTF 5,000
SA Audit and Annual Financial Statement (The Pun Group, etc) RPTTF 22,000 Other Professional Contracted Services, Technology Charges (HdL Property Tax Service, etc) RPTTF 32,000
Printing / Copying / Duplicating Equipment Rental / Other Misc RPTTF 5,000 Total Administrative Cost 100,000
Total Direct and Administrative Cost 190,000$
City Council Staff Report
DATE: November 15, 2023
AGENDA ITEM NO:
TO: The Honorable Mayor and City Council
FROM: Martha Garcia, Finance Director
SUBJECT: Consideration of Adoption of a Resolution To Authorize Open Market Bond Repurchase of a Portion of the City of Monterey Park Outstanding Taxable Pension Obligation Bonds, Series 2021
RECOMMENDATION:
It is recommended that the City Council consider:
1. Adopting a Resolution of the City Council of The City of Monterey Park:
a. authorizing the Open Market Bond Repurchase of a Portion of its Outstanding Taxable Pension Obligation Bonds, Series 2021; b. approving a Repurchase Agent and authorizing the City Manager to execute an agreement, in a form approved by the City Attorney, with Samuel A.
Ramirez & Co., Inc.; and
c. authorizing certain additional actions in connection therewith.
2. Taking such additional, related, action that may be desirable.
EXECUTIVE SUMMARY:
On February 16, 2021, the City of Monterey Park issued Taxable Pension Obligation Bonds, Series 2021 (2021 POBS) in the amount of $106,335,000. The proceeds were used to pay the City’s unfunded accrued liability (UAL), with respect to certain pension benefits of designated City employees, to the California Public Employees’ Retirement System (CalPERS). The City is required to make principal and interest payments each year on the outstanding 2021 POBS. The significant increase in interest rates since the issuance of the 2021 POBs has decreased the price of bonds in the secondary market.
If current bondholders are willing to sell bonds back to the City at a discount, the City could generate debt service savings with the repurchase of 2021 POBS.
As of June 30, 2023, Pension Fund 202 has a fund balance of approximately $4.4 million.
The Finance Director recommends allocating a maximum of $4 million of Pension Fund 202 funds to repurchase a portion of the 2021 POBS on the open market. However, there is no assurance that investors will agree to sell their bonds back to the City. If no current bondholders are willing to sell the 2021 POBS at the prices the City is prepared to offer for repurchase, then the City would still have to pay any non-contingent consultant fees.
Additionally, there are alternative uses for the $4 million that the City may wish to consider.
Consent Calendar - 3E
Staff Report
November 15, 2023
BACKGROUND:
Interest rates directly impact bond prices; as interest rates rise, bond prices fall (and vice versa). When the 2021 POBS were issued, interest rates were near historical lows. Since that time, sharp increases in interest rates have produced corresponding decreases in the secondary market prices of bonds. Due to the decrease in the market prices for bonds, the City may be able to reduce its debt service liability by repurchasing a portion of the 2021 POBS at a discount on the open market. However, there are a number of variables that bondholders consider when deciding whether or not to sell their bonds, some of which may not be tied to the interest rate environment. Therefore, it is possible that despite the City’s interest in repurchasing a portion of the 2021 POBS, there will be no interested seller.
The 2021 POBS were issued under a June 1, 2004 Trust Agreement between the City and Computershare Trust Company, N.A. (the “Trustee”), which was amended in February 2021. The Trust Agreement authorizes the City to repurchase all or a portion of the outstanding 2021 POBS. In order to facilitate the repurchase of a portion of the 2021 POBS, the City must appoint an agent to repurchase the bonds on its behalf.
It is recommended that the City appoint Samuel A. Ramirez & Co., Inc. (“Ramirez & Co.”) to serve as its repurchase agent. The terms and conditions governing such repurchase by Ramirez & Co. and the obligations of the City will be set forth in a separate agreement with Ramirez & Co. Upon the successful repurchase of a portion of the 2021 POBS designated in the Trust Agreement as the 2043 Term Bonds (the “Target Bonds”), the City will deposit Pension Fund 202 monies with the Trustee in an amount not to exceed $4,000,000, which includes any fees and costs incurred with the repurchase. Once Ramirez & Co. has repurchased a portion of the Target Bonds on the open market and delivered them to the Trustee, the Trustee must reimburse Ramirez & Co. for the repurchase, pay related fees and costs, and cancel the portion of the repurchased Target Bonds, thereby terminating the City’s future debt service payments related to these Target Bonds.
In connection with the proposed repurchase of a portion of the Target Bonds, the City will post a notice on the Municipal Securities Rulemaking Board’s Electronic Municipal Market Access website to inform current owners of the outstanding Target Bonds of the City’s Bond Repurchase Program and to provide for the disclosure of certain material information to the owners of the Target Bonds in connection with the Bond Repurchase Program. This notice is required by Rule 10b-5 promulgated under the Securities Exchange Act of 1934 and must provide current owners of the Target Bonds material information to enable them to make an informed decision of whether or not to sell their securities, including any significant changes to the condition of the City’s General Fund since the most recent audited fiscal year ( FY 2021-22).
It is proposed that the City appoint Urban Futures, Inc. as municipal advisor and Stradling Yocca Carlson & Rauth as special counsel in connection with this financing.
Staff Report
November 15, 2023
FISCAL IMPACT:
Approval of the open market bond repurchase of a portion of the outstanding 2021 POBs may result in a reduction of principal and interest payments of the repurchased bonds.
The amount of the reduction is dependent on the quantity of 2021 POBS that are successfully repurchased and the purchase price at which such 2021 POBS are repurchased. The City will also have to pay fees to consultants for their role in repurchasing bonds.
While the current market offers opportunities to generate interest earnings at a higher rate than the borrowing rate on the Target Bonds, the economic benefit of purchasing Target Bonds at a significant discount could outweigh potential foregone interest earnings.
As an alternative to using Pension Fund 202 monies to repurchase Target Bonds in the open market, the City could elect to make Additional Discretionary Payments to CalPERS to pay down its UAL. As of the June 30, 2022 valuation date, the CalPERS Annual Valuation Reports indicate that the City’s Safety Plan has $12.9 million of UAL and the Miscellaneous Plan has $10.1 million of UAL. The City could use the $4 million to make additional discretionary payments (at once or over time) to CalPERS to reduce the UAL and lower associated costs of the UAL. The total savings achieved with this strategy would be subject to the investment performance of CalPERS.
Respectfully submitted by:
Martha Garcia
Director of Finance
Approved by: Reviewed by:
Inez Alvarez
Interim City Manager
Ephraim S. Margolin
Deputy City Attorney
ATTACHMENT:
1. Resolution of the City Council of City of Monterey Park Authorizing Open Market Bond Repurchase of a Portion of its Outstanding Taxable Pension Obligation Bonds, Series 2021
Staff Report
November 15
, 2023
ATTACHMENT 1
Draft Resolution
RESOLUTION NO.
A RESOLUTION AUTHORIZING THE OPEN MARKET BOND
REPURCHASE OF A PORTION OF ITS OUTSTANDING TAXABLE
PENSION OBLIGATION BONDS, SERIES 2021, APPROVING SAMUEL A. RAMIREZ & CO., INC. AS ITS REPURCHASE AGENT AND
AUTHORIZING CERTAIN ADDITIONAL ACTIONS
The City Council for the City of Monterey Park (the “City Council”) does resolve as follows:
SECTION 1: The City Council finds and declares as follows:
A. In order to refinance certain pension liabilities, the City issued Taxable Pension Obligation Bonds, Series 2021 (the “2021 POBS”) on February 16, 2021, pursuant a June 1, 2004 Trust Agreement with Computershare Trust Company, N.A., successor trustee (the “Trustee”), and supplemented by a First Supplemental Trust Agreement dated February 1, 2021 (together, the “Trust Agreement”);
B. The City is obligated to make certain semi-annual debt service payments on these outstanding 2021 POBS;
C. Recent increases in yields demanded by owners of municipal bonds have produced corresponding decreases in the market prices for certain bonds; D. Due to the decrease in bond market prices, the City may be able to reduce its debt service liability by purchasing a portion of the 2021 POBS maturing June 1, 2043 and referred to in the Trust Agreement as the “2043 Term Bonds” (the “Target Bonds”);
E. It is in the public interest to authorize the repurchase of a portion of the outstanding principal amount of the Target Bonds on the open market, from time to time; provided that such purchases can be made at a discount from the outstanding principal amount of the Target Bonds to be purchased (“Bond Repurchase Program”);
F. The City may utilize legally available monies in the City’s Pension Liability Fund (“Surplus Cash”) to purchase a portion of the outstanding Target Bonds pursuant to the Bond Repurchase Program and deliver them to the Trustee for cancellation;
G. Cancellation of a portion of the outstanding Target Bonds will reduce the overall principal amount of the 2021 POBs and eliminate the annual amount of interest payable by the City for the cancelled Target Bonds;
Resolution No.
November 15, 2023
H. The City Council desires to engage Samuel A. Ramirez & Co., Inc. (“Ramirez & Co.”) to serve as its repurchase agent in connection with the open market purchase of a portion of the Target Bonds pursuant to the terms of an agreement approved as to form by the City Attorney;
I. Following adoption of this Resolution by the City Council, the City will post a notice on the Municipal Securities Rulemaking Board’s Electronic Municipal Market Access (“EMMA”) website to inform current owners of the outstanding Target Bonds of the City’s Bond Repurchase Program and to disclose certain material information to the owners of the Target Bonds in connection with the Bond Repurchase Program; and
J. The City Council authorizes the Bond Repurchase Program, provided that any repurchase under the Bond Repurchase Program will provide significant public benefits in the form of reductions in the amounts of both the principal and interest payable on the Target Bonds as set forth in this resolution and as determined in the discretion of any Authorized Officer (defined below).
SECTION 2: The City Council’s findings are true and correct. All actions taken by the City Manager and the Authorized Officers in furtherance of the Bond Repurchase Program, including the posting of the notice on EMMA and any amendment or supplement to the Trust Agreement approved by any Authorized Officer in accordance with this Resolution, are accepted and ratified.
SECTION 3: The Bond Repurchase Program is approved. The Authorized Officers are designated as the City Manager, the Finance Director, and their designees, which are each authorized to utilize Surplus Cash to purchase outstanding bonds of the Target Bonds from time to time provided that:
A. The amount of Surplus Cash so used may not exceed a total of $4,000,000, inclusive of any fees and costs of such repurchase; and B. The repurchase results in a debt service reduction on the Target Bonds, net of all fees and expenses incurred in connection therewith.
SECTION 4: Each Authorized Officer, is authorized to negotiate, execute, and deliver one or more amendments or supplements to the Trust Agreement if necessary or advisable in the view of the City’s special counsel to accomplish the Bond Repurchase Program, and each Authorized Officer is authorized and directed to take any actions necessary to effectuate such amendment or supplement to the Trust Agreement.
Resolution No.
November 15, 2023
SECTION 5: All compensation payable to Ramirez & Co. for its services as Repurchase Agent will be included in the proposed acquisition cost of the bonds presented for purchase provided, however, that in no event may Ramirez & Co.’s compensation exceed 1.00% of the principal amount of any Target Bonds so purchased.
SECTION 6: The following professionals are appointed to serve the City in connection with the Bond Repurchase Program:
A. Urban Futures, Inc. is engaged as municipal advisor; and B. Stradling Yocca Carlson & Rauth is engaged as special counsel.
SECTION 7: The City Manager is authorized to execute agreements, in a form approved by the City Attorney, or to sign such other documentation as is necessary or appropriate to evidence such engagements and retain such services in connection with the Bond Repurchase Program.
SECTION 8: Each Authorized Officer is authorized and directed, jointly and severally, to execute and sign any and all approvals, certificates, statements, requests, requisitions and orders of the City in connection with the implementation of the Bond Repurchase Program and the purchase and cancelation of Target Bonds pursuant thereto; and any action specifically authorized or directed by this Resolution to be undertaken by any of such officers may be undertaken by another with the same force and effect as if it had been undertaken by the officer specifically authorized or directed to do so.
SECTION 9: Electronic Signatures. This Resolution may be executed with electronic signatures in accordance with Government Code §16.5. Such electronic signatures will be treated in all respects as having the same effect as an original signature.
SECTION 10: Severability. If any part of this Resolution or its application is deemed invalid by a court of competent jurisdiction, the City Council intends that such invalidity will not affect the effectiveness of the remaining provision or application and, to this end, the provisions of this Resolution are severable.
SECTION 11: Recordation. The Mayor, or presiding officer, is authorized to sign this Resolution signifying its adoption by the City Council of the City of Monterey Park and the City Clerk, or her duly appointed deputy, may attest thereto.
SECTION 12: Effective Date. This Resolution will become effective immediately upon adoption and will remain effective unless repealed or superseded.
Resolution No.
November 15, 2023
PASSED, APPROVED, AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF MONTEREY PARK THIS 15th DAY OF NOVEMBER 2023.
____________________________
Jose Sanchez, Mayor
ATTEST:
____________________________
Maychelle Yee, City Clerk
APPROVED AS TO FORM:
____________________________
Karl H. Berger, City Attorney
By: __________________________________
Ephraim S. Margolin, Deputy City Attorney
City Council Staff Report
DATE: November 15, 2023
AGENDA ITEM NO:
TO: The Honorable Mayor and City Council
FROM: Martha Garcia, Finance Director
SUBJECT: Consideration of Adoption of a Resolution Directing the Interim City Manager to Take Actions Necessary to Finance Water Facilities and Improvements to the Water System
RECOMMENDATION:
It is recommended that the City Council consider:
1. Adopting Resolution No. _______ directing the Interim City Manager to take actions necessary to finance water facilities and improvements to the Water System; and
2. Taking such additional, related, action that may be desirable.
EXECUTIVE SUMMARY:
The City has set a Public Hearing to consider rate adjustments to the Water System on December 6, 2023, and the City has already mailed the Proposition 218 notice with proposed water rate increases of 32%, 8%, 8%, 7%, and 8% starting in Fiscal Year 2023- 24 through Fiscal Year 2027-28, respectively. However, issuing bonds to finance a portion of the needed improvements to the Water System would lower the cumulative rate increases from Fiscal Year 2023-24 through Fiscal Year 2027-28 and allow the City to accelerate much needed projects, including replacement of water meters.
BACKGROUND:
At its September 26, 2023 Council Meeting, the Council received and filed the Water and Sewer Rate Study, established proposed water rate adjustments of 32%, 8%, 8%, 7%, and 8% from Fiscal Year 2023-24 through Fiscal Year 2027-28, directed the City Manager to implement the Proposition 218 protest ballot process for proposed rate setting, and set a Public Hearing for December 6, 2023 to consider the rate increases.
The Council acknowledged that even if a majority of parcels do not protest the proposed rate adjustments, allowing Council to implement the proposed rate increases, the Council could decide to set rates lower than the proposed rates. The Council also discussed the needed improvements to the Water System and directed staff to return with more information regarding a potential bond financing to fund some of the improvements.
Financing some of the improvements would also lower the cumulative rate increases from Fiscal Year 2023-24 through Fiscal Year 2027-28 (compared to the currently proposed rate increases) by spreading the cost of the improvements over a longer period of time.
Staff has identified $20 million in water improvements that are high priority and that could be implemented within the next 3 years. In particular, staff has discussed with Council Consent Calendar - 3F
Staff Report
November 15, 2023
the replacement of water meters, which would result in higher revenues due to more accurate reading of water usage. By financing this project, water meters could be installed earlier, thereby recovering revenues sooner.
Financing $20 million in projects would allow rate increases to be set at 26%, 8%, 8%, 7%, 7% instead of at the currently proposed higher rate increases described above.
However, cumulative rate increases would need to be higher from Fiscal Year 2028-29 through Fiscal Year 2032-33 due to interest costs related to the financing (rather than paying with cash). Below is a comparison of the projected rates from Fiscal Year 2023- 24 through Fiscal Year 2032-33, assuming $20 million of improvements are funded with cash or with the issuance of water revenue bonds.
The process of bond financing takes approximately 3 -4 months. Therefore, should the Council desire to consider bond financing and adopting lower cumulative rate increases from Fiscal Year 2023-24 through Fiscal Year 2027-28 than the proposed rate increases, staff recommends that Council adopt the Resolution to hire the financing team (bond and disclosure counsel, municipal advisor, trustee, and underwriter) to evaluate the feasibility of and take actions needed to proceed with the financing. This action would not commit the City to authorize the issuance of bonds. Staff would seek Council authorization to issue bonds and bring draft financing documents to the Council in January 2024, after the completion of the Proposition 218 process. This would allow the financing to close in February 2024 (at which point the City would receive the bond proceeds).
FISCAL IMPACT:
No fiscal impact at this time. By adopting the Resolution, staff and consultants would begin working on the financing, but consultant fees would only be paid upon the closing of a financing and would be paid out of bond proceeds.
Fiscal Year Effective Date
Increase
without Bond
Increase with
$20mm Bond
FY 2023-24 1/1/2024 32.0% 26.0%
FY 2024-25 7/1/2024 8.0% 8.0%
FY 2025-26 7/1/2025 8.0% 8.0%
FY 2026-27 7/1/2026 7.0% 7.0%
FY 2027-28 7/1/2027 8.0% 7.0%
FY 2028-29 7/1/2028 3.0% 3.0%
FY 2029-30 7/1/2029 3.0% 3.0%
FY 2030-31 7/1/2030 0.0% 3.0%
FY 2031-32 7/1/2031 0.0% 3.0%
FY 2032-33 7/1/2032 0.0% 3.0%
Staff Report
November 15, 2023
Respectfully submitted by:
Martha Garcia
Director of Finance
Approved by: Reviewed by:
Inez Alvarez
Interim City Manager
Karl H. Berger
City Attorney
ATTACHMENTS:
1. City Council Resolution No. __________
2. Water and Sewer Rate Study
ATTACHMENT 1
City Council Resolution
Staff Report
November 15, 2023
A-1
RESOLUTION NO. __________
RESOLUTION DIRECTING THE CITY MANAGER AND MUNICIPAL
FINANCE PROFESSIONALS TO PREPARE NECESSARY
DOCUMENTATION FOR BONDS TO FINANCE WATER FACILITIES
AND IMPROVEMENTS TO THE WATER SYSTEM
The City Council does resolve as follows:
SECTION 1: The City desires to finance certain costs of improvements to the City’s water system and the repair and replacement of certain existing water facilities , including water meter replacements, reservoir improvements, water main replacements, programmable logic controller (PLC) upgrades and other appurtenant facilities (collectively, the “Project”) by issuing water revenue bonds (the “Bonds”) via the Monterey Park Financing Authority (the “Authority”).
SECTION 2: The Authority previously assisted the City with financing costs related to improvements to the City’s water facilities.
SECTION 3: To provide for issuing Bonds to finance the Project, the Interim City Manager, with the assistance of special counsel, consultants, and other third parties designated in this Resolution, will proceed to evaluate the feasibility of and take actions needed to proceed with the financing of the Project through issuance of the Bonds.
SECTION 4: This Resolution does not commit the City Council to issue Bonds, but authorizes the drafting of the necessary financial documents to return to the City Council and Board of Directors for the Authority in January 2024.
SECTION 5: Before and as a condition of issuance of the Bonds, the City Council and the Board of Directors of the Authority must authorize issuing the Bonds at a future public meeting.
SECTION 6: The City Council authorizes and directs the Interim City Manager and City Attorney to coordinate the attorneys, consultants, and third parties designated in Section 7 below to take all actions necessary and appropriate to present the Bonds and related agreements to the City Council and the Board of Directors of the Authority for approval at a future meeting of the City Council and the Board of Directors of the Authority.
SECTION 7: The City Council approves and appoints Stradling Yocca Carlson & Rauth, a Professional Corporation, as Bond and Disclosure Counsel; Urban Futures, Inc., Inc., as Municipal Advisor; and U.S. Bank Trust Company, National Association as Trustee, each to provide such services to the City as may be required to issue the Bonds.
The City Council appoints Samuel A. Ramirez & Company, Inc., to serve as Underwriter in connection with the sale of the Bonds. The Interim City Manager and designees are hereby authorized and directed to execute agreements (in a form approved by the City Attorney) as is necessary or appropriate to evidence such engagements and retain such services with these financing team members.
SECTION 8: Severability. If any part of this Resolution or its application is deemed invalid by a court of competent jurisdiction, the City Council intends that such invalidity will not affect the effectiveness of the remaining provision or application and, to this end, the provisions of this Resolution are severable.
SECTION 9: Preservation. This Resolution does not affect any penalty, forfeiture, or liability incurred before, or preclude prosecution and imposition of penalties for any violation occurring before, this Resolution’s effective date. Any such amended part will remain in full force and effect for sustaining action or prosecuting violations occurring before the effective date of this Resolution.
SECTION 10: Supersession. This Resolution will remain effective until superseded by a subsequent resolution.
SECTION 11: Electronic Signatures. This Resolution may be executed with electronic signatures in accordance with Government Code §16.5. Such electronic signatures will be treated in all respects as having the same effect as an original signature.
SECTION 12: Recordation. The Mayor, or presiding officer, is authorized to affix his signature to this Resolution signifying its adoption by the City Council of the City of Monterey Park, and the City Clerk, or her duly appointed deputy, is directed to attest thereto.
PASSED, APPROVED, AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF MONTEREY PARK THIS ___ DAY OF NOVEMBER 2023.
Jose Sanchez, Mayor
ATTEST:
Maychelle Yee, City Clerk
APPROVED AS TO FORM:
Karl H. Berger, City Attorney
ATTACHMENT 2
Water and Sewer Rate Study
Staff Report
November 15, 2023
September 15, 2023
Revised October 30, 2023
CITY OF MONTEREY PARK
Utility Rate Study
CITY OF MONTEREY PARK
320 West Newmark Ave
Monterey Park, CA 91754
UTILITY RATE STUDY
September 15, 2023
Revised October 30, 2023
HF&H CONSULTANTS, LLC
590 Ygnacio Valley Rd, Suite 105
Walnut Creek, CA 94596
© HF&H CONSULTANTS, LLC All rights reserved.
HF&H CONSULTANTS, LLC
Managing Tomorrow’s Resources Today
590 Ygnacio Valley Rd, Suite 105 Robert D. Hilton, CMC
Walnut Creek, California 94596 John W. Farnkopf, PE
Tel: (925) 977-6950 Laith B. Ezzet, CMC
Fax: (925) 977-6955 Richard J. Simonson
hfh-consultants.com Marva M. Sheehan, CPA
Robert C. Hilton
October 30, 2023
Martha Garcia
Director of Finance
City of Monterey Park
320 West Newmark Ave
Monterey Park, CA 91754
Subject: Utility Rate Study Report
Martha Garcia:
HF&H is pleased to submit this cost-of-service report to the City of Monterey Park.
HF&H is pleased to submit this cost-of-service rate s t u d y t o t h e C i t y o f M o n t e r e y P a r k . T h i s s t u d y documents our methodology and recommendations. We recommend adopting rate adjustments for the next five years, beginning January 1, 2024, and each July 1 through July 1, 2027.
We greatly appreciate your assistance in developing this cost-of-service analysis.
Sincerely,
HF&H CONSULTANTS, LLC
Rick Simonson
Senior Vice President
City of Monterey Park Utility Rate Study
Final Report Table of Contents
HF&H Consultants, LLC Page i October 30, 2023
TABLE OF CONTENTS
1. EXECUTIVE SUMMARY ..................................................................................................................... 1 A. Background ........................................................................................................ 1 B. Water Rates ....................................................................................................... 1 C. Sewer Rates ....................................................................................................... 3 Fund Balance Projections ........................................................................................... 3 Current and Proposed Sewer Rates ............................................................................ 4
2. INTRODUCTION ................................................................................................................................ 5 A. Study Purpose .................................................................................................... 5 B. Study Process ..................................................................................................... 5 C. Report Organization ............................................................................................ 5
3. WATER RATE STUDY ......................................................................................................................... 6 A. Revenue Requirements and Financial Projections .................................................. 6 Assumptions ............................................................................................................. 6 Revenue Projections .................................................................................................. 8 Water Reserve Fund Balance Projections .................................................................... 9 B. Cost-of-Service Analysis .................................................................................... 11 General Approach .................................................................................................... 11 Allocation Factors .................................................................................................... 11 Cost Allocations ....................................................................................................... 13 Consumption Charge Cost Allocation ........................................................................ 15 Summary of Allocations by Customer Class ............................................................... 15 C. Rate Design ...................................................................................................... 17 Water Meter Charge Rates ....................................................................................... 17 Consumption Charge Design .................................................................................... 19 All Other Customers Consumption Charges ............................................................... 20 Consumption Charge Summary ................................................................................ 21
4. SEWER RATE STUDY ....................................................................................................................... 22 A. Reven ue Requirements and Financial Projections ................................................ 22 Assumptions ........................................................................................................... 22 Revenue Projections ................................................................................................ 23 Sewer Reserve Fund Balance Projections .................................................................. 24 B. Cost-of-Service Analysis .................................................................................... 26 Analytical Approach ................................................................................................. 26 Allocation Factors .................................................................................................... 26 Cost Allocations ....................................................................................................... 27 Cost of Service by Customer Class ............................................................................ 27 C. Rate Design ...................................................................................................... 29 Fixed and Variable Costs .......................................................................................... 29 Residential Rate Design ........................................................................................... 30 Commercial and Institutional Rate Design ................................................................. 30 Proposed Rates ....................................................................................................... 31
City of Monterey Park Utility Rate Study
Final Report Table of Contents
HF&H Consultants, LLC Page ii October 30, 2023
5. CUSTOMER BILL IMPACTS ...................................................................................................... ........ 32 Bill Comparisons ........................................................................................................... 32
TABLE OF FIGURES
Figure 1-1. Water Enterprise Projected Fund Balance ................................................................................. 1 Figure 1-2. Projected Water Rate Revenue Increases ................................................................................. 2 Figure 1-3. Proposed Water Monthly Service Charge.................................................................................. 2 Figure 1-4. Proposed Water Consumption Charge (per hcf) ....................................................................... 2 Figure 1-5. Sewer Enterprise Projected Fund Balance ................................................................................. 3 Figure 1-6. Projected Sewer Rate Revenue Increases ................................................................................. 3 Figure 1-7. Current and Proposed Monthly Sewer Rates ............................................................................ 4 Figure 3-1. Projection Assumptions ............................................................................................................. 6 Figure 3-2. Projected O&M Expenses .......................................................................................................... 7 Figure 3-3. Annual Debt Service ................................................................................................................... 7 Figure 3-4. Debt Coverage ........................................................................................................................... 8 Figure 3-5. Water Rate Revenue Adjustments............................................................................................. 8 Figure 3-6. Projected Water Rate Revenue ................................................................................................. 9 Figure 3-7. Water Enterprise Projected Fund Balance ............................................................................... 10 Figure 3-8. Service Level Demands and Load Factors ................................................................................ 12 Figure 3-9. Demand Related Allocation Percentages ................................................................................ 13 Figure 3-10. Allocation Factors .................................................................................................................. 13 Figure 3-11. Revenue Requirement Allocations ........................................................................................ 14 Figure 3-12. Comparison of Current Revenue with Cost-of-Service Allocations ....................................... 15 Figure 3-13. Variable Charge Cost Allocations by Customer Class............................................................. 15 Figure 3-14. Customer Class Allocations .................................................................................................... 16 Figure 3-15. Service Charge Units of Service .............................................................................................. 18 Figure 3-16. Proposed Monthly Service Charge Rates – FY 2023-24 .......................................................... 18 Figure 3-17. Current and Proposed Monthly Service Charge Rates ........................................................... 18 Figure 3-18. Single Family Residential Tier Breakpoint Locations ............................................................. 19 Figure 3-19. Incremental Unit Cost – Single Family Residential ................................................................. 20 Figure 3-20. Calculation All Other Uniform Consumption Charges ............................................................ 21 Figure 3-21. Proposed Consumption Charges ............................................................................................ 21 Figure 4-1. Projection Assumptions ........................................................................................................... 22 Figure 4
-2. Projected Annual Revenue Requirements ............................................................................... 23 Figure 4-3. Sewer Rate Revenue Adjustments ........................................................................................... 23 Figure 4-4. Projected Sewer Rate Revenue ................................................................................................ 24 Figure 4-5. Sewer Enterprise Projected Fund Balance ............................................................................... 25 Figure 4-6. Allocation Factors .................................................................................................................... 27 Figure 4-7. Net Revenue Requirement Allocations .................................................................................... 27 Figure 4-8. Cost-of-Service Allocation to Customer Classes ...................................................................... 28 Figure 4-9. Unit Costs by Customer Class .................................................................................................. 30 Figure 4-10. Derivation of Monthly Residential Rates ............................................................................... 30 Figure 4-11. C&I Monthly Rate Calculation ................................................................................................ 31 Figure 4-12. Proposed Sewer Rates ........................................................................................................... 31 Figure 5-1. Single Family Residential Combined Monthly Bill Impact ....................................................... 32 Figure 5-2. Multi Family Residential Combined Monthly Bill Impact ........................................................ 33
City of Monterey Park Utility Rate Study
Final Report Table of Contents
HF&H Consultants, LLC Page iii October 30, 2023
Figure 5-3. Commercial and Institutional Combined Monthly Bill Impact ................................................ 33
ACKNOWLEDGEMENTS
City Council
Jose Sanchez, Mayor
Thomas Wong, Mayor Pro Tem
Vinh T. Ngo, Council Member, District 5
Yvonne Yiu, Council Member, District 2
Henry Lo, Council Member, District 4
City Staff
Inez Alvarez, Interim City Manager
Martha Garcia, Director of Finance
Shawn Igoe, Public Works Director
Legal Counsel
Karl H. Berger, City Attorney
HF&H Consultants, LLC
Rick Simonson, Senior Vice President
Gabe Sasser, Project Manager
Geoff Michalczyk, Senior Associate
Other Consultants
Wing-See Fox, Urban Futures
Michael Busch, Urban Futures
LIMITATIONS
This document was prepared solely for the City of Monterey Park in accordance with the contract between the City and HF&H and is not intended for use by any other party for any other purpose.
In preparing this study, we relied on information from the City, which we consider accurate and reliable.
Our analysis is based on the best available information at the time of the study.
Rounding differences caused by stored values in electronic models may exist.
This document represents our understanding of relevant laws, regulations, and court decisions but should not be relied upon as legal advice. Questions concerning the interpretation of legal authorities referenced in this document should be referred to a qualified attorney.
UTILITY RATE STUDY
City of Monterey Park Utility Rate Study
Final Report 1. Executive Summary
HF&H Consultants, LLC Page 1 October 30, 2023
1. EXECUTIVE SUMMARY
A. BACKGROUND
HF&H Consultants, LLC (HF&H) was retained by the City of Monterey Park (City) to conduct a utility rate study for its Water and Sewer Enterprises. This study documents the process by which our projected water and sewer rates were developed for a ten-year planning period, from FY 2023-24 through FY 2032-
33. Though our models looked at a ten-year planning period, Article XIIID, Section 6 of the State Constitution limits the adoption of rates to no more than five years at a time. The proposed rates summarized in this executive summary and explained in more detail in Section 3 (Water Rates) and Section 4 (Sewer Rates), are limited to the next five years (FY 2023-24 through FY 2027-28).
B. WATER RATES
The projected fund balance for the Water Enterprise was updated by first preparing a ten-year projection of operating and capital expenses. The projected increases needed in rate revenue were determined by comparing the expense projections with the revenue generated from current rates. The ten-year Water Enterprise fund balance projections are shown in Figure 1-1 with and without the proposed rate revenue increases shown in Figure 1-2 . Without rate increases, the Water Enterprise’s fund balance will be depleted before the end of FY 2024-25 (dotted green line). With the proposed revenue increases, the fund balance will always exceed the City’s minimum reserve target (i.e., two months of annual Water Enterprise operating expenses) and approach the total target reserve by FY 2032-33.
Figure 1-1. Water Enterprise Projected Fund Balance
City of Monterey Park Utility Rate Study
Final Report 1. Executive Summary
HF&H Consultants, LLC Page 2 October 30, 2023
Figure 1-2. Projected Water Rate Revenue Increases
The larger rate increase, effective January 1, 2024 ar e necessary to cover the existing revenue shortfall from the lack of rate increases since 2017 and to meet the City’s debt co verage ratio the mimium requirement of 1.2x net revenue, for existing debt. Th is requirement must be met as a condition of the debt agreement for the outstanding loans of the Water Enterprise. This larger increase will also ensure reserves can be maintained above the minimum target through the duration of the planning period.
Current and Proposed Water Rates
Based on the cost-of-service analysis (discussed in de tail in Section 3) and the proposed rate revenue increases shown in Figure 1-2, the current and projected rates are shown in Figure 1-3 and Figure 1-4.
Figure 1-3. Proposed Water Monthly Service Charge
Figure 1-4. Proposed Water Consumption Charge (per hcf)
Fiscal Year
Effective
Date
Overall Rate
Revenue
Increase
FY 2023-24 1/1/2024 32.0%
FY 2024-25 7/1/2024 8.0%
FY 2025-26 7/1/2025 8.0%
FY 2026-27 7/1/2026 7.0%
FY 2027-28 7/1/2027 8.0%
FY 2028-29 7/1/2028 3.0%
FY 2029-30 7/1/2029 3.0%
FY 2030-31 7/1/2030 0.0%
FY 2031-32 7/1/2031 0.0%
FY 2032-33 7/1/2032 0.0%
Monthly Service Charges
FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 Meter Size Current Rates 1/1/2024 7/1/2024 7/1/2025 7/1/2026 7/1/2027 5/8" meters $26.40 $20.16 $21.77 $23.51 $25.16 $27.17
3/4" meters $26.40 $27.18 $29.36 $31.71 $33.93 $36.64
1" meters $28.53 $41.23 $44.53 $48.10 $51.46 $55.58
1 1/2" meters $44.96 $76.36 $82.47 $89.07 $95.30 $102.93 2" meters $57.96 $118.52 $128.00 $138.24 $147.91 $159.75 3" meters $115.98 $230.92 $249.40 $269.35 $288.20 $311.26 4" meters $191.88 $357.38 $385.98 $416.85 $446.03 $481.72 6" meters $585.68 $708.66 $765.35 $826.58 $884.44 $955.20 8" meters $1,464.79 $1,130.20 $1,220.61 $1,318.26 $1,410.54 $1,523.38 Water Consumption Charge (per unit)
FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 Monthly Use Current Rates Monthly Use 1/1/2024 7/1/2024 7/1/2025 7/1/2026 7/1/2027 Tier 1 (0-6 hcf) $2.89 Tier 1 (0 - 10 hcf) $3.41 $3.69 $3.98 $4.26 $4.60 Tier 2 (7-12 hcf) $3.15 Tier 2 (11 - 16 hcf) $4.50 $4.86 $5.24 $5.61 $6.06 Tier 3 (13+ hcf) $3.37 Tier 3 (17+ hcf) $8.51 $9.19 $9.92 $10.62 $11.47 All Consumption $3.29 All Consumption $4.25 $4.59 $4.95 $5.30 $5.73 Single Family Residential
All Other
City of Monterey Park Utility Rate Study
Final Report 1. Executive Summary
HF&H Consultants, LLC Page 3 October 30, 2023
C. SEWER RATES
Fund Balance Projections
The projected fund balance for the Sewer Enterprise was updated by first preparing a ten-year projection of operating and capital expenses. The projected increases needed in rate revenue were determined by comparing the expense projections with the revenue generated from current rates. The ten-year fund balance projections are shown in Figure 1-5 (solid green line) with the associated proposed rate revenue increases shown in Figure 1-6. In addition, Figure 1-5 shows the projected annual fund balances without the revenue increases (dotted green line). As shown, without any rate increases, the fund balance will be fully depleted sometime before the end of FY 2024-25.
Figure 1-5. Sewer Enterprise Projected Fund Balance
Figure 1-6. Projected Sewer Rate Revenue Increases
Fiscal Year
Effective
Date
Overall
Rate
Revenue
Increase
FY 2023-24 1/1/2024 40.0%
FY 2024-25 7/1/2024 30.0%
FY 2025-26 7/1/2025 10.0%
FY 2026-27 7/1/2026 10.0%
FY 2027-28 7/1/2027 4.0%
FY 2028-29 7/1/2028 4.0%
FY 2029-30 7/1/2029 3.0%
FY 2030-31 7/1/2030 3.0%
FY 2031-32 7/1/2031 3.0%
FY 2032-33 7/1/2032 3.0%
City of Monterey Park Utility Rate Study
Final Report 1. Executive Summary
HF&H Consultants, LLC Page 4 October 30, 2023
The larger rate increase, effective January 1, 2024 are necessary to cover the existing revenue shortfall from the lack of rate increases since 2017, as well as maintaining a reserve balance above the minimum target through the duration of the planning period.
Current and Proposed Sewer Rates
With the modifications and cost recovery calculatio ns described above, the current and proposed rates are shown in Figure 1-7.
Figure 1-7. Current and Proposed Monthly Sewer Rates
Current Current Proposed
Customer Class Units FY 2022-23 Units FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 Single Family effective date 1/1/2024 7/1/2024 7/1/2025 7/1/2026 7/1/2027 5/8", 3/4" account $10.17 per account/DU $15.71 $20.42 $22.46 $24.71 $25.70 1" account $12.42 per account/DU $15.71 $20.42 $22.46 $24.71 $25.70 1 1/2" account $12.86 per account/DU $15.71 $20.42 $22.46 $24.71 $25.70 Multi Family
3/4" account $29.01 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 1" account $34.76 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 1 1/4" account $57.25 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 1 1/2" account $84.15 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 2" account $161.22 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 3" account $413.02 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 4" account $534.30 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 Commercial
3/4" account $27.09 account $27.37 $35.58 $39.14 $43.05 $44.78 1" account $40.68 account $45.61 $59.30 $65.23 $71.75 $74.62 1 1/4" account $40.68 account $91.22 $118.59 $130.45 $143.50 $149.24 1 1/2" account $78.41 account $145.95 $189.74 $208.71 $229.58 $238.76 2" account $198.97 account $291.91 $379.49 $417.44 $459.18 $477.55 3" account $270.68 account $456.11 $592.94 $652.23 $717.45 $746.15 4" account $386.69 account $912.21 $1,185.88 $1,304.46 $1,434.91 $1,492.31 6" account $1,052.20 account $1,459.54 $1,897.40 $2,087.15 $2,295.86 $2,387.69 Institutional
3/4" account $46.29 account $27.37 $35.58 $39.14 $43.05 $44.78 2" account $68.48 a ccount $291.91 $379.49 $417.44 $459.18 $477.55 3" account $73.29 account $456.11 $592.94 $652.23 $717.45 $746.15 4" account $168.28 account $912.21 $1,185.88 $1,304.46 $1,434.91 $1,492.31 Proposed
Monthly Sewer Rates
City of Monterey Park Utility Rate Study
Final Report 2. Introduction
HF&H Consultants, LLC Page 5 October 30, 2023
2. INTRODUCTION
A. STUDY PURPOSE
The purpose of this study is to conduct a cost-of-service analysis that will determine rates that proportionally recover the cost of providing the City’s water and sewer services. The cost-of-service analysis is tailored specifically to the City’s customer classes and the rate structures that are appropriate for each class. The study identifies the total cost incurred by the City for providing potable water and wastewater services; identifies classes of customers (e.g., residential and commercial); determines the demand created by each class of customer for th e potable water and wastewater services; and then calculates the proportionate cost sharing for each customer class to create the rate structure.
B. STUDY PROCESS
The rate study was conducted following industry standards and practices promulgated by the American Water Works Association (AWWA) and the Water Enviro nment Federation (WEF). A comprehensive rate study involves the four steps:
1. Revenue requirements were projected for a ten-year planning period based on operations, maintenance, capital expenses, and contributions to reserves.
2. The cost-of-service analysis allocates the proj ected expenses among th e customer classes in proportion to their use of the systems.
3. Rates are then calculated so that rate payers are charged equitably based upon each customer classes proportionate use.
4. For illustrative purposes, to demonstrate the impact of the proposed rate adjustments on average water use customers for each customer class, we compare bills under the proposed rates with bills under the current rates.
C. REPORT ORGANIZATION
This report describes each of the four rate-making steps for the Water Fund followed by the Sewer Fund.
A glossary of technical terms and acronyms is provid ed following the Table of Contents. An appendix contains a copy of portions of the rate model that are not included in the body of the report text as tables and figures.
City of Monterey Park Utility Rate Study
Final Report 3. Water Rate Study
HF&H Consultants, LLC Page 6 October 30, 2023
3. WATER RATE STUDY
A. REVENUE REQUIREMENTS AND FINANCIAL PROJECTIONS
To determine whether additional water rate revenue is required, projected operating and capital expenses are compared with projected revenue from current rates. Annual surpluses and deficits are then applied to the reserve funds. Rates are then increased so that the expenses are covered and operating and capital reserves are maintained. Th e following sections summarize the methodology for determining the annual revenue requirements, the necessary annual revenue increases, and the projected impact these results will have on the Sewer Enterprise fund balance.
Assumptions
A spreadsheet model was developed to derive revenue requirements for FY 2022-23 through FY 2032-33.
The revenue requirements represent the costs that must be covered by revenue from rates and other sources, such as reserves. The City’s Council-approved operating and capital budget for FY 2022-23 served as the starting point for projecting the City’s expenses and revenues over the ten-year financial planning period. We worked with City staff to proj ect beyond FY 2022-23. The assumptions shown in Figure 3-1 were used to project operating expenses, capital project costs, account growth, and water demand through FY 2032-33. The application of these assu mptions to the O&M and capital expenses are summarized in Figure 3-2 and are described in more detail below. The revenue from current rates (plus growth) is also shown (dotted black line).
Figure 3-1. Projection Assumptions
FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29 FY 2029-30 FY 2030-31 FY 2031-32 FY 2032-33 Annual Account Growth Rate 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% Annual Water Demand Increases 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% General Inflation Budgeted 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% Salaries & Wages Budgeted 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% Benefits Budgeted 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% Utilites Budgeted 4.03% 4.03% 4.03% 4.03% 4.03% 4.03% 4.03% 4.03% 4.03% 4.03% Construction Cost Inflation 2.92% 2.92% 2.92% 2.92% 2.92% 2.92% 2.92% 2.92% 2.92% 2.92% 2.92% Interest on Fund Balance 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40%
City of Monterey Park Utility Rate Study
Final Report 3. Water Rate Study
HF&H Consultants, LLC Page 7 October 30, 2023
Figure 3-2. Projected O&M Expenses
1 Water Non-Operating Revenues include mete r installation fees, monies received fr om a settlement with the Environmental Protection Agency (estimated at $3.6 million to be received from FY 2022-23 through FY 2024-25), and the sale of surplus Water Enterprise property (e.g., vehicles, com puters, equipment) which is not longer n eeded. These non-operating revenues reduce the necessary revenue that needs to come from rates to cover operating and capital costs.
Debt Service. The City’s Water Enterprise has three outstanding loans. Figure 3-3 shows the annual debt service for each loan.
Current: A 15-year lease purchase agreement with Si emens Public, Inc. for the purchase and installation of interior lighting retrofits, exteri or lighting retrofits, HVAC equipment replacement at select sites, building automation system and water meter replacements. The Water Enterprise is responsible for 85% of this debt service.
Current: A 30-year loan agreement with the California Infrastructure and Economic Development Bank for the construction of the La Loma and Highland reservoirs. This study assumes this debt service will be refunded by the proposed $15 million bond issuance in FY 2023-24.
Current: A 10-year loan agreement with the San Ga briel Valley Water Company for $4 million at 0% interest. Debt proceeds are anticipated to be received in FY 2022-23 with payment beginning in FY 2023-24.
Figure 3-3. Annual Debt Service
Figure 3-4 shows the debt service coverage provided by the revenue increases in Figure 3-5. The City aims to maintain a coverage ratio of 1.25. A higher ratio provides a greater margin of safety to bondholders FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29 FY 2029-30 FY 2030-31 FY 2031-32 FY 2032-33 Salaries & Benefits $4,459,996 $4,630,859 $4,808,701 $4,993,824 $5,186,544 $5,387,190 $5,596,109 $5,813,660 $6,040,221 $6,276,186 $6,521,9 69 Water Supply $3,800,000 $3,842,000 $3,885,260 $3,929,818 $3,975,712 $4,022,984 $4,071,673 $4,121,823 $4,173,478 $4,226,682 $4,281,483 Operations $8,799,966 $9,076,375 $9,361,576 $9,655,853 $9,959,499 $10,272,818 $10,596,123 $10,929,736 $11,273,991 $11,629,233 $11,995,818 Capital Projects $4,735,623 $2,666,212 $2,666,212 $2,666,212 $2,666,212 $2,666,212 $4,621,900 $4,621,900 $4,621,900 $4,621,900 $4,621,900 Debt Service $873,691 $1,317,343 $2,302,574 $2,339,841 $2,384,051 $2,424,071 $2,465,788 $2,539,465 $1,448,375 $1,340,875 $1,340,250 Non-Op Revenue1 ($703,000) ($1,606,090) ($1,609,273) ($112,551) ($115,927) ($119,405) ($122,987) ($126,677) ($130,477) ($134,392) ($138,423) Net Revenue Requirement $21,966,277 $19,926,699 $21,415,050 $23,472,997 $24,056,091 $24,653,870 $27,228,605 $27,899,907 $27,427,487 $27,9 60,485 $28,622,996 $0.0
$5.0
$10.0
$15.0
$20.0
$25.0
$30.0
$35.0
FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29 FY 2029-30 FY 2030-31 FY 2031-32 FY 2032-33 Millions
Sa laries & Be nef its Water Supply Operations Capital Projects Debt Service Revenue at Current Rates FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29 FY 2029-30 FY 2030-31 FY 2031-32 FY 2032-33 Siemens $804,851 $850,949 $888,341 $928,551 $970,446 $1,014,788 $1,091,840 $0 $0 $0 I-Bank Loan $112,492 $112,492 $112,492 $112,492 $112,492 $112,492 $112,492 $112,492 $0 $0 San Gabriel Valley Water $400,000 $400,000 $400,000 $400,000 $400,000 $400,000 $400,000 $400,000 $400,000 $400,000 Total Debt Service $1,317,343 $1,363,441 $1,400,833 $1,441,043 $1,482,938 $1,527,280 $1,604,332 $512,492 $400,000 $400,000
City of Monterey Park Utility Rate Study
Final Report 3. Water Rate Study
HF&H Consultants, LLC Page 8 October 30, 2023
and can enhance the credit rating on bonds. This is particularly true with water utilities whose revenues are vulnerable to periods of conservation. It is projected that the City will be above its party debt coverage target through this ten-year planning period.
Figure 3-4. Debt Coverage
Revenue Projections
Given the projected O&M and capital costs that need to be recovered through rate (shown in Figure 3-2), HF&H developed a rate revenue adjustment scenario that maintains adequate fund balances (see Figure 3-9) for the ongoing operations of the Water Enterprise. These rate revenue adjustments are shown in Figure 3-5 . Figure 3-6 shows the projected water rate revenue associated with the rate revenue adjustments.
Figure 3-5. Water Rate Revenue Adjustments
Debt Coverage Calculation FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29 FY 2029-30 FY 2030-31 FY 2031-32 FY 2032-33 Funds Available for Debt Service
Rate revenue - Service Charges $16,741,245 $20,728,063 $22,553,726 $24,313,218 $26,455,205 $27,453,507 $28,489,779 $28,704,346 $28,920,8 34 $29,139,260 Non-Rate Revenue Income $1,606,090 $1,609,273 $112,551 $115,927 $119,405 $122,987 $126,677 $130,477 $134,392 $138,423 Interest income $60,477 $36,834 $29,741 $28,687 $26,668 $26,827 $32,246 $39,828 $48,236 $55,210 Total Funds Available $18,407,811 $22,374,170 $22,696,018 $24,457,833 $26,601,278 $27,603,321 $28,648,702 $28,874,651 $29,103,461 $29,332 ,893 Expenses
O&M $17,549,234 $18,055,537 $18,579,495 $19,121,755 $19,682,992 $20,263,905 $20,865,219 $21,487,689 $22,132,101 $22,799,270 Total Expenses $17,549,234 $18,055,537 $18,579,495 $19,121,755 $19,682,992 $20,263,905 $20,865,219 $21,487,689 $22,132,101 $22,799,270 Net Revenue $858,577 $4,318,633 $4,116,523 $5,336,078 $6,918,286 $7,339,416 $7,783,483 $7,386,962 $6,971,360 $6,533,624 New Debt Service -iBank Loan $112,492 $112,492 $112,492 $112,492 $112,492 $112,492 $112,492 $112,492 $0 $0 New Debt Service - FY 2024 Issuance $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Parity Debt Service $112,492 $112,492 $112,492 $112,492 $112,492 $112,492 $112,492 $112,492 $0 $0 Parity Debt Coverage Ratio 7.63 38.39 36.59 47.44 61.50 65.24 69.19 65.67 N/A N/A Net Funds Available $746,085 $4, 206,141 $4,004,031 $5,223,586 $6,805,794 $7,226,924 $7,670,991 $7,274,470 $6,971,360 $6,533,624 Subordinate Debt Service (Siemens, San Gabriel) $1,204,851 $1,250,949 $1,288,341 $1,328,551 $1,370,446 $1,414,788 $1,491,840 $400,000 $4 00,000 $400,000 Subordinate Debt Coverage Ratio 0.62 3.36 3.11 3.93 4.97 5.11 5.14 18.19 17.43 16.33
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Figure 3-6. Projected Water Rate Revenue
Water Reserve Fund Balance Projections
The rate revenue adjustments in Figure 3-5 were developed by analyzing the City’s projected expenses over the course of the planning period against its projected revenues.
In addition to covering annual expenses, water rate s need to generate revenue to maintain adequate operations and capital reserves. To determine what constitutes adequate reserve amounts, the City’s Water Enterprise fund balance is divided into operating and capital reserves. Recommended target balances are set to fund each reserve. The resultin g cash balances with the recommended rate revenue increases (shown in Figure 3-5), is represented by the solid green line in Figure 3-7. In addition, Figure 3- 7 shows the projected annual fund balances without the revenue increases (dotted green line). As shown, without any rate increase, the fund balance will be fully depleted sometime before the end of FY 2024-
25. The cash reserve targets used in Figure 3-7 are as follows:
Operating Reserve. The operating component of the reserves provides working capital for month- to-month O&M expenditures. With sufficient working capital, the City can operate without cash flow constraints. The City’s reserve policy is two months of operating expenses. The City’s reserves should never drop below this minimum balance. The operating reserve target is represented by the red line in Figure 3-7.
Capital Reserve. The capital component of the reserves provides working capital for the City’s capital improvement projects. The fund balance needs to be sufficient to at least pay contractors without delays caused by cash flow limitations. The fund balance can be larger so that the City can fund larger construction projects on a pay-as-you-go basis, thereby eliminating financing costs. The City’s reserve policy for the capital reserve is 25% of accumulated depreciation of capital assets.
Total Reserve Target. The total reserve target for the City is the sum of the target balances for the operating reserve and capital reserve. The targ et balance is represented by the blue line in Figure 3-7.
Months
Increase
In Effect FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29 FY 2029-30 FY 2030-31 FY 2031-32 FY 2032-33 Water Rate Revenue $14,367,574 $14,432,107 $14,539,887 $14,648,625 $14,758,330 $14,869,013 $14,980,683 $15,093,350 $15,207,024 $15,321,715 $15,437,433 Increase in Rate Revenue 0.0% 32.0% 8.0% 8.0% 7.0% 8.0% 3.0% 3.0% 0.0% 0.0% 0.0% Revenue from Rate Increases
FY 2023-24 (eff. Jan 1, 2024) 6 $2,309,137 $4,652,764 $4,687,560 $4,722,666 $4,758,084 $4,793,819 $4,829,872 $4,866,248 $4,902,949 $4,939, 979 FY 2024-25 (eff. Jul 1, 2024) 12 $1,535,412 $1,546,895 $1,558,480 $1,570,168 $1,581,960 $1,593,858 $1,605,862 $1,617,973 $1,630,193 FY 2025-26 (eff. Jul 1, 2025) 12 $1,670,646 $1,683,158 $1,695,781 $1,708,517 $1,721,366 $1,734,331 $1,747,411 $1,760,608 FY 2026-27 (eff. Jul 1, 2026) 12 $1,590,584 $1,602,513 $1,614,549 $1,626,691 $1,638,942 $1,651,303 $1,663,775 FY 2027-28 (eff. Jul 1, 2027) 12 $1,959,645 $1,974,362 $1,989,211 $2,004,193 $2,019,308 $2,034,559 FY 2028-29 (eff. Jul 1, 2028) 12 $799,617 $805,630 $811,698 $817,820 $823,996 FY 2029-30 (eff. Jul 1, 2029) 12 $829,799 $836,049 $842,354 $848,716 FY 2030-31 (eff. Jul 1, 2030) 12 $0 $0 $0
FY 2031-32 (eff. Jul 1, 2031) 12 $0 $0
FY 2032-33 (eff. Jul 1, 2032) 12 $0
Total Revenue from Rate Increases $0 $2,309,137 $6,188,176 $7,905,101 $9,554,888 $11,586,191 $12,472,823 $13,396,428 $13,497,322 $13,599,118 $13,701,827 Total Current Revenue $14,367,574 $14,432,107 $14,539,887 $14,648,625 $14,758,330 $14,869,013 $14,980,683 $15,093,350 $15,207,024 $15,321,715 $15,437,433 Total Revenue with Rate Increases $14,367,574 $16,741,245 $20,728,063 $22,553,726 $24,313,218 $26,455,205 $27,453,507 $28,489,779 $28,704,346 $28,920,834 $29,139,260 Total Revenue Requirement $21,966,277 $23,254,061 $22,923,279 $24,867,777 $25,446,871 $26,046,526 $26,290,097 $26,964,774 $26,491,604 $27 ,019,610 $27,682,746 Transfer to/(from) Reserves ($7,598,702) ($6,512,817) ($2,195,216) ($2,314,051) ($1,133,653) $408,679 $1,163,410 $1,525,005 $2,212,742 $1,901,224 $1,456,513
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Figure 3-7. Water Enterprise Projected Fund Balance
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B. COST-OF-SERVICE ANALYSIS
General Approach
The revenue requirement analysis establishes how much revenue is required from rates. The next step in the analysis is determining the cost of service (COS ) by customer class. Th e cost-of-service analysis performed in this study follows a procedure that has been long established by the American Water Works Association (AWWA), which is referred to as the “bas e/extra capacity method.” This method allocates the revenue requirements to the components of the rate structure.
The base/extra capacity method in the AWWA M1 Manual contains three categories: base, maximum day, and maximum hour. Base capacity is determined by the average daily flow during the year. The average daily flow determines how much base capacity is need ed to provide that flow. Maximum day capacity is determined by the flow on the maximum day of the year. In other words, the maximum day capacity is greater than the base capacity, including the base capacity plus the additional capacity needed to provide for the maximum day flow of the year. Maximum hour capacity is determined by the flow during the maximum hour on the maximum day. In other words, the maximum hour capacity is greater than the maximum day capacity by the amount of peak hour that occurs during the maximum day flow.
As the name implies, COS is a process of determini ng how much water service costs to provide capacity to meet customer demands. To provide water service, infrastructure must be constructed, operated, and maintained, which must be paid for from cash or debt. The type and size of infrastructure depends on how much service customers require. Water systems are designed to provide sufficient capacity to meet customer demands for service wherever, whenever, and for as long as demanded.
Although each customer places unique demands on the system, water system design is based on the maximum or peak demand for service placed on the system by all customers during the peak demand period. The size of the infrastructure that is needed will depend on the maximum demand. Higher demands will obviously require larger, more costly infrastructure as well as increased operating and O&M costs. Here, the goal of a COS analysis is to allocate the cost of the capacity to meet the peak demand in proportion to how much of the capacity is required by each customer. The proportions correspond to the maximum amount of capacity provided by the infrastructure. This means that customers that place greater demands on the infrastructure – customers with greater service needs (i.e., higher peak demands) – will be apportioned a greater share of the operating and capital costs of the infrastructure required to meet that demand.
It is important to realize that once the peak demand is used to design the infrastructure, the capacity is available at all times, not just during peak demands. The capacity is available for the potential peak when it occurs. During off-peak demands, the same facilities are being used, but the capital cost of the facilities is determined by the peak demand only, and it is the peak demand that is used to allocate costs. Note that the costs are not allocated only to those who pe ak. Those who do not peak as much are also using the same facilities. Consequently, they are allocated a share of the costs of the facilities in proportion to their contribution to the peak demand, even though their contribution to peaking may be significantly less.
Allocation Factors
Within the demand service function, allocations are made to varying levels of service ranging from average day demand to the highest level of peak demand for outdoor water use and irrigation during the peak
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hour of the peak day. With these allocations, rates can be designed to proportionately charge customers based on their demands.
Average Day Demand: Average day demand represents demand that includes only an average level of peaking. The average day demand was derived for each customer class from the City’s customer billing data of actual water use.
Maximum Day Demand: Maximum day demand includes average day demand plus peak day demand in the irrigation season. The City does not directly meter maximum day demand, so this analysis relied on the City’s most recent water system master plan which estimated the maximum day demand to be 1.60 times the average day demand.
Maximum Hour Demand: Maximum hour demand represents the maximum hour demand on the maximum day. The City does not directly meter maximum day demand, so this analysis relied on the City’s most recent water system master plan which estimated the maximum day demand to be 3.00 times the average day demand.
The flows associated with the demand service levels for each customer class are shown in Figure 3-8. The system-wide allocation percentages corresponding to those flows are shown in Figure 3-9. Note that costs that are classified as maximum day are allocated across average day and maximum day and not allocated only to maximum day. This is done because the capacity provided by maximum day facilities also provides capacity to meet average day demands. Similarly, maximum hour costs are spread across average day and maximum hour demands.
Figure 3-8. Service Level Demands and Load Factors
Base Maximum Maximum
Day Day Hour
Demand by Customer Category
Single Family Re side ntial 3,529 5,646 10,586 A ll Othe r 4,618 7,388 13,853 Total 8,146 13,034 24,439
Ratio of Flows to Base Day
Single Family Re side ntial 1.00 1.60 3.00 A ll Othe r 1.00 1.60 3.00 Total 1.00 1.60 3.00
L e ve l of Se rvice 8,146 13,034 24,439 Base Day Demand 8,146 8,146 8,146 Ratio of Level of Service to Base Day 1.00 1.60 3.00 Base Day: Average of February and March Bi l l ed Usage Annual i zed Maxi mum Day: Per 1-5 of 2012 Master Pl an
Maximum Hour: Per 1-5 of 2012 Master Plan
Levels of Demand
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Figure 3-9. Demand Related Allocation Percentages
The allocation factors for costs classified as meter charge are either 100% account or capacity allocations.
Figure 3-10 summarizes the allocation factors for the demand and customer service costs. In addition, it shows the composite allocations. The O&M and Capita l composite allocations are based on subtotals of the O&M and Capital costs that were directly allocated to either the demand or customer service categories. The expense composite is based on the combined subtotal of all directly classified costs.
Figure 3-10. Allocation Factors
Cost Allocations
Figure 3-11 shows the FY 2022-23 revenue requirement allo cated into the demand and customer ser- vices. Each line item was classified according to the associated function. The allocation factors summarized in Figure 3-10 allocate costs across the services based on the allocation factor column in Figure 3-11.
Load Base Maximum Maximum
Allocation Basis Factors Day Day Hour Totals
Base Day 1.00 1.00 1.00
Allocation % 100% 100%
Maximum Day 1.60 1.00 0.60 1.60 Allocation % 63% 38% 100%
Maximum Hour 3.00 1.00 0.60 1.40 3.00 Allocation % 33% 20% 47% 100%
Demand Service Levels
Maximum Maximum
Base Day Hour Accounts Capacity Total
Demand Services
B a s e D a y 1 0 0 . 0 %0 . 0 %0 . 0 %0 . 0 %0 . 0 % 1 0 0 . 0 % Max Day 62.5% 37.5% 0.0% 0.0% 0.0% 100.0%
Max Hour 33.3% 20.0% 46.7% 0.0% 0.0% 100.0%
Customer Services
Capacity 0.0% 0.0% 0.0% 0.0% 100.0% 100.0%
Accounts 0.0% 0.0% 0.0% 100.0% 0.0% 100.0%
Composite Allocations
O&M Composite 79.7% 6.0% 11.9% 1.9% 0.6% 100.0%
CIP Composite 10.0% 3.2% 2.2% 0.6% 84.0% 100.0%
Exp Composite 64.2% 5.4% 9.8% 1.6% 19.1% 100.0%
Customer ServicesDemand Services
System-Wide Cost
Allocation Factors
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Figure 3-11. Revenue Requirement Allocations
The results of the cost-of-service allocations are shown in Figure 3-12 which compares the revenue produced by the current rates for each of the charges with the cost-of-service allocations, which do not include the proposed rate revenue increase. The allocations slightly shift costs from the meter charges to the consumption charges.
FY 2022-23 Allocation Base Maximum Maximum
Revenue Requirement Factor Day Day Hour Accounts Capacity O&M Expenses
1406 - Revenue Collection $182,828 Accounts $0 $0 $0 $182,828 $0 3240 - Code Compliance $130,511 Accounts $0 $0 $0 $130,511 $0 4212 - Engineering $380,287 Max Day $237,679 $142,608 $0 $0 $0 4221 - Water Commercial $1,736,604 Base Day $1,736,604 $0 $0 $0 $0 4222 - Water Production $4,913,136 Base Day $4,913,136 $0 $0 $0 $0 4223 - Water Distribution $4,249,920 Max Hour $1,416,640 $849,984 $1,983,296 $0 $0 4226 - Well No. 5 $1,277,666 Base Day $1,277,666 $0 $0 $0 $0 4227 - Well No. 12 Treatment Plant $1,167,904 Base Day $1,167,904 $0 $0 $0 $0 4229 - Well No. 1, 3, 10 $1,113,670 Base Day $1,113,670 $0 $0 $0 $0 4230 - Well 12 Dual Barrier $814,220 Base Day $814,220 $0 $0 $0 $0 4231 - Well 15 $598,299 Base Day $598,299 $0 $0 $0 $0
4202 - Street Maintenance $101,220 Capacity $0 $0 $0 $0 $101,220 Total Allocable O&M $16,666,265 $13,275,818 $992,592 $1,983,296 $313,339 $101,220 O&M Composite 79.7% 6.0% 11.9% 1.9% 0.6%
Capital Expenses (PayGo) $4,735,623 CIP Composite $471,365 $153,787 $104,008 $26,634 $3,979,829 Subtotal - O&M and Capital $21,401,888 $13,747,183 $1,146,378 $2,087,304 $339,974 $4,081,049 % of Consumption 81.0% 6.8% 12.3%
% of total 64.2% 5.4% 9.8% 1.6% 19.1%
Administrative Costs
1702 - Building & Safety $132,198 Accounts $0 $0 $0 $132,198 $0 4210 - Maintenance $369,693 Accounts $0 $0 $0 $369,693 $0 4220 - Water Administration $568,981 Accounts $0 $0 $0 $568,981 $0 5102 - Post Employment $196,516 Accounts $0 $0 $0 $196,516 $0 Administrative Costs $1,267,389 $0 $0 $0 $1,267,389 $0
Subtotal O&M, Capital, Non-Operat $22,669,277 $13,747,183 $1,146,378 $2,087,304 $1,607,362 $4,081,049 Expense Allocation 60.6% 5.1% 9.2% 7.1% 18.0%
Non-Operating Revenue
Meter Installation ($100,000) A c c o u n t s $ 0$ 0$ 0 ($100,000) $0 EPA Settlement ($600,000) A c c o u n t s $ 0$ 0$ 0 ($600,000) $0 Sale of Surplus Property ($3,000) Exp Composite ($1,927) ($161) ($293) ($48) ($572) Total Non-Operating ($703,000) ($1,927) ($161) ($293) ($700,048) ($572) Transfers to/(from) Reserves ($7,598,702) O&M Composite ($6,052,885) ($452,555) ($904,250) ($142,862) ($46,150) Total Revenue Requirement $14,367,574 $7,692,370 $693,662 $1,182,761 $764,453 $4,034,328 $9,568,794 $764,453 $4,034,328
% of total revenue requirement 66.6% 33.4%
Consumption Charge COS Service Charge COS
Meter ChargeConsumption Charge
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Figure 3-12. Comparison of Current Revenue with Cost-of-Service Allocations Consumption Charge Cost Allocation
Figure 3-13 derives the cost-of-service for each of the City’s customer classes. The allocation for the potable water classes encompasses each classes’ proportionate share of the three demand service levels (i.e., average day, maximum day, and maximum hour) because they share common facilities. Moreover, the allocation of costs to the single family customers needs to be tracked by demand service level for purposes of calculating the single family tiered rates.
Figure 3-13. Variable Charge Cost Allocations by Customer Class Summary of Allocations by Customer Class
The allocations by customer class are summarized in Figure 3-14. Both the single family class and all other classes (non-single family) will only see a slight shif t from the revenue being generated at current rates compared with the cost-of-service.
Components of Rate Structure
Total
Consumption Charge Revenue $9,373,164 65% $9,568,794 67% $195,630 2.1% Meter Charge Revenue $4,994,411 35% $4,798,781 33% ($195,630) -3.9% Total $14,367,574 100% $14,367,574 100% ($0) 0.0%
Current Rates FY 2022-23 FY 2022-23 COS Minus Current
Revenue at Cost of Service Difference
Base Max Max
Consumption Charge Cost-of-Service Day Day Hour Total
Operations & Maintenance $13,275,818 $992,592 $1,983,296 $16,251,706 Capital Expenses (PayGo) $471,365 $153,787 $104,008 $729,159 Non-Operating Revenue ($1,927) ($161) ($293) ($2,380)
Transfers to/(from) Reserves ($6,052,885) ($452,555) ($904,250) ($7,409,691) Total Consumption Charge COS $7,692,370 $693,662 $1,182,761 $9,568,794 Units of Service (hcf)
Single Family Residential 3,529 5,646 10,586
All Other 4,618 7,388 13,853
8,146 13,034 24,439
Proportional Allocation Factors
Single Family Residential 43.32% 43.32% 43.32%
All Other 56.68% 56.68% 56.68%
100.00% 100.00% 100.00%
Total COS - Residential $3,332,147 $300,478 $512,343 $4,144,968 Total COS - All Other $4,360,223 $393,185 $670,418 $5,423,826 Grand Total Consumption Charge COS $7,692,370 $693,662 $1,182,761 $9,568,794
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Figure 3-14. Customer Class Allocations
Components of Rate Structure
Single Family Residential
Consumption Charge Revenue $3,834,482 52% $4,144,968 57% $310,486 8.1% Meter Charge Revenue $3,570,143 48% $3,094,356 43% ($475,787) -13.3% Subtotal - SFR $7,404,625 100% $7,239,324 100% ($165,301) -2.2% All Other
Consumption Charge Revenue $5,538,682 80% $5,423,826 76% ($114,856) -2.1% Meter Charge Revenue $1,424,268 20% $1,704,424 24% $280,157 19.7% Subtotal - All Other $6,962,950 100% $7,128,250 100% $165,301 2.4% Total
Consumption Charge Revenue $9,373,164 65% $9,568,794 67% $195,630 2.1% Meter Charge Revenue $4,994,411 35% $4,798,781 33% ($195,630) -3.9% Total $14,367,574 100% $14,367,574 100% ($0) 0.0%
Current Rates FY 2022-23 FY 2022-23 COS Minus Current
Revenue at Cost of Service Difference
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C. RATE DESIGN
The City charges water customers the sum of a fixed monthly meter charge and a consumption charge that varies based on monthly water use. This sectio n explains the derivation of the rates that determine each customer’s charges. These rates are based on the results of the cost-of-service analysis in the preceding chapter.
Water Meter Charge Rates
Meter charges are fixed rates charged per account that are billed each billing period to recover the cost of the customer service function. The meter charges are graduated in proportion to the maximum capacity (i.e., maximum flow through a meter) serving a property. Meter charges are also independent of customer classes because the capacity of a service does not ch ange depending on what class of customer that is connected to the water system.
The cost-of-service analysis determ ined how much of the revenue requirement is attributable to the customer service function. The function has two components – customer accounts (e.g., customer service staffing, billing) and customer capaci ty (e.g., capital and operating cost s associated with maintaining the water transmission and distribution system) – each of wh ich is itemized in the cost-of-service analysis in Figure 3-11 . Costs attributable to customer accounts are allocated to customers in proportion to the number of accounts. As such, all customers pay the same for these costs which do not vary based on flow.
Costs attributable to customer capacity are allocated to customers in proportion to the capacity of their services. As such, customer pay a graduated rate based on their meter size, as larger meters provide more capacity to the customer. The sum of the two components equals the meter charge per connection.
Figure 3-15 lists the units of service corresponding to each of the cost components. The 13,770 accounts are used for apportioning the customer accounts cost component.
Capacity costs associated with the distribution system are apportioned among the connections in proportion to the capacity associated with each connection in accordance with the American Water Works Association’s recommended rated capacities. Accounts are converted to Equivalent Meter Units (EMUs) to apportion the customer capacity cost component. An EMU represents the number of ¾-inch meters to which a larger meter is equivalent. For example, a 1-inch meter provides 1.67 times as much capacity as a ¾-inch meter. The capacity multipliers are based on the nominal capacity of the City’s meters. The 2,445 1-inch meters equal 4,075 EMUs. There are 21,055 total EMUs. In effect, the 13,770 services of assorted sizes have the equivalent capacity as 21,055 ¾-inch meters.
Figure 3-15 also derives the unit costs for the customer accounts and customer capacity cost components.
Each account is allocated $4.63 for the customer account cost component. That amount represents the costs the City incurs to maintain an account regardless of the capacity of the service. Each account is also allocated $15.97 per EMU. That amount represents a portion of the cost of providing distribution system capacity for each account, and increases based on the capacity of the meter.
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Figure 3-15. Service Charge Units of Service
Figure 3-16 combines the customer service and capacity components into a single Service Charge for each size service and compares proposed rates to the current rates.
Figure 3-16. Proposed Monthly Service Charge Rates – FY 2023-24
Figure 3-17 shows the proposed five-year schedule of meter charges.
Figure 3-17. Current and Proposed Monthly Service Charge Rates
Service # of Meter Capacity
Size Accounts Ratings (gpm) Multiplier EMUs
a b c = b ÷ 30 a * c
5/8" 1 20 0.67 1
3/4" 9,571 30 1.00 9,571
1" 2,445 50 1.67 4,075
1.5" 1,254 100 3.33 4,180
2" 450 160 5.33 2,400
3" 18 320 10.67 192
4" 25 500 16.67 417
6" 5 1000 33.33 167
8" 1 1600 53.33 53
Total Accounts 13,770 Total EMUs 21,055
Units Costs (from Figure 3-14) $764,453 $4,034,328
# of Accounts 13,770 # of EMUs 21,055
Monthly Cost per Account $4.63 Monthly Cost per EMU $15.97 Based on AWWA gpm ratings
Account COS FY 2023-24 Proposed
Service % of Component Capacity Capacity Service Charges Increase Service Charges Size Meters ($/mo.) $/EMU Mult iplie r T ot al ($/m o.) ($/m o.) a b c d = b * c e = a + d f g = e * (1 + f)
5/8" meters 0.0% $4.63 $15.97 0.67 $10.64 $15.27 32.0% $20.16 3/4" meters 69.5% $4.63 $15.97 1.00 $15.97 $20.59 32.0% $27.18 1" meters 17.8% $4.63 $15.97 1.67 $26.61 $31.24 32.0% $41.23 1 1/2" meters 9.1% $4.63 $15.97 3.33 $53.22 $57.85 32.0% $76.36 2" meters 3.3% $4.63 $15.97 5.33 $85.16 $89.78 32.0% $118.52 3" meters 0.1% $4.63 $15.97 10.67 $170.32 $174.94 32.0% $230.92 4" meters 0.2% $4.63 $15.97 16.67 $266.12 $270.75 32.0% $357.38 6" meters 0.0% $4.63 $15.97 33.33 $532.24 $536.87 32.0% $708.66 8" meters 0.0% $4.63 $15.97 53.33 $851.58 $856.21 32.0% $1,130.20 Capacity Component
Monthly Service Charges
FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 Meter Size Current Rates 1/1/2024 7/1/2024 7/1/2025 7/1/2026 7/1/2027 5/8" meters $26.40 $20.16 $21.77 $23.51 $25.16 $27.17
3/4" meters $26.40 $27.18 $29.36 $31.71 $33.93 $36.64
1" meters $28.53 $41.23 $44.53 $48.10 $51.46 $55.58
1 1/2" meters $44.96 $76.36 $82.47 $89.07 $95.30 $102.93 2" meters $57.96 $118.52 $128.00 $138.24 $147.91 $159.75 3" meters $115.98 $230.92 $249.40 $269.35 $288.20 $311.26 4" meters $191.88 $357.38 $385.98 $416.85 $446.03 $481.72 6" meters $585.68 $708.66 $765.35 $826.58 $884.44 $955.20 8" meters $1,464.79 $1,130.20 $1,220.61 $1,318.26 $1,410.54 $1,523.38
City of Monterey Park Utility Rate Study
Final Report 3. Water Rate Study
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Consumption Charge Design
Single Family Residential Consumption Charge
Tiered rate structures are well suited to single-family residential quantity charges because of the wide variation in peak demand patterns. The use of three tiers has been in place for the City’s single-family residential customers and continues to be appropriate based on an analysis of actual water use patterns of single-family customers, conducted for this study. With three tiers, we size tiers corresponding average day demand, maximum day demand, and maximum hour pe ak demand. The size of the tiers is based on the demand pattern for single-family customers usi ng water meter data collected by the City. The proposed breakpoints align the cost associated with each level of demand with the demand in each tier.
The rates for each tier cannot exceed the proportional cost of service for each tier. In the City’s case, a three-tier structure aligns well with the three demand service levels where Tier 1, Tier 2, and Tier 3 correspond with average day, maximum day, and maximum hour demands. Given a three-tier structure, the following describes how the size of the tiers and rate per tier were derived.
It is not the case that all the water is billed at only the rate for the highest block. All metered water use is at least billed the Tier 1 rate. Water use beyond Tier 1 is only billed the Tier 2 rate for the volume of water allocated to Tier 2, and water use beyond the volume of water allocated to Tier 2 is billed at the Tier 3 rate.
The base/extra capacity cost-of-service analysis leads to three distinct levels of demand that are defined by the functions performed by facilities that are desi gned to provide the service levels. Each service has an average flow that can be used as the divider (i.e., “breakpoint”) between each service level. Based on single family billing data, the breakpoints were calculated as shown in Figure 3-18.
Figure 3-18. Single Family Residential Tier Breakpoint Locations
The breakpoints create the following tiers, which apply to monthly water use:
• Tier 1: 0-10 hcf per month
• Tier 2: 11-16 hcf per month
• Tier 3: 17+ hcf per month
With breakpoints that correspond to the service levels in the cost-of-service analysis, it is possible to calculate the rate per tier by dividing the cost-of-service per tier by the water demand in each tier. The resulting rates represent the unit cost of service for each tier.
Base Maximum Maximum
Flow per Customer (hcf per month) Day Day Hour
Single Family
hcf per day 3,529 5,646 10,586
hcf per month 105,864 169,383
# of Accounts 10,768 10,768
Average flow per Acct (hcf/mo) 10.0 16.0 17+
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Figure 3-19 shows the calculations of the incremental cost per tier. Using the base day service function as an example, $3,332,147 of the revenu e requirement is recovered from Tier 1. All of the water sold, including water in Tiers 2 and 3, benefits from the Tier 1 costs and shares in paying them. Dividing the base day costs by the total demand of 1,288,016 HCF in Figure 3-19 yields a Tier 1 rate of $2.59 per HCF.
Demand that does not exceed the 10 hcf Tier 1 breakp oint is only charged the Tier 1 rate. Demand that does not exceed Tier 1 is not responsible for the addi tional costs of peaking th at were allocated to the higher service levels. Bills that exceed Tier 1 pay additional rate increments. The next increment of demand is responsible for the costs allocated to average day service, $300,478 in Figure 3-19. This increment of cost is divi ded by the demand that exceeds Tier 1, 367,086 hcf, resulting in an incremental Tier 2 rate of $0.82 per hcf. This incremental increase gets added to the Tier 1 rate to determine the total Tier 2 rate, as shown in Figure 3-19.
The calculation of the Tier 3 rate increment proceeds similarly in Figure 3-19. It can be seen that the incremental rate for Tier 3 Tier 2. The $512,343 allocated to the maximum hour service level is only slightly higher, but it is only the highest 168,562 hcf that cr eate the need for this increment of peak capacity, which results in an incremental Tier 3 rate of $3.04 pe r hcf. This incremental increase gets added to the Tier 1 and Tier 2 rates to determine the total Tier 3 rate, as shown in Figure 3-19.
The incremental rates are additive. In other words, demand in Tier 1 only pays the base day rate. Demand in Tier 2 pays the base day rate plus the average day increment, and so forth. Adding the increments yields the rates per tier. These rates per tier plus a 32% ov erall rate revenue increase in FY 2023-24 results in the proposed rates per tier in Figure 3-19.
Figure 3-19. Incremental Unit Cost – Single Family Residential
All Other Customers Consumption Charges
It is recommended that the City continue with the same uniform rate structure for all other customers (non-single family residential). The proposed adjustment is intended to increase the uniform rate to re- Base Maximum Maximum
Single Family COS per Unit Day Day Hour
Tier 1 Tier 2 Tier 3
Single Family COS - Consumption $3,332,147 $300,478 $512,343 Demand Per Tier
Tier 1 (0 - 10 hcf) 920,930
Tier 2 (11 - 16 hcf) 198,524 198,524 Tier 3 (17+ hcf) 168,562 168,562 168,562 Total hcf per Tier 1,288,016 367,086 168,562 Cost-of-Service per Unit (hcf) $2.59 $0.82 $3.04
Tier 1 (0 - 10 hcf) $2.59 $2.59 $2.59
Tier 2 (11 - 16 hcf) $0.82 $0.82
Tier 3 (17+ hcf) $3.04
Unit Cost per hcf (by Tier) $2.59 $3.41 $6.45
FY 2023-24 Rate Increase 32.0% 32.0% 32.0%
Proposed FY 2023-24 Rates $3.41 $4.50 $8.51
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align with the cost-of-service for this customer class. The uniform rate is derived by dividing this class’s share of the FY 2022-23 revenue requirement by the class’s projected annual demand.
Figure 3-20. Calculation All Other Uniform Consumption Charges
Consumption Charge Summary
The five-year schedule of proposed Volume Charge rates for Residential and Non-Residential customers is shown in Figure 3-21.
Figure 3-21. Proposed Consumption Charges
All Other Revenue Requirement $5,423,826
Projected Demand (hcf) 1,685,411
Uniform Consumption Charge per hcf $3.22
FY 2023-24 Rate Increase 32.0%
Proposed FY 2023-24 Rate $4.25
Water Consumption Charge (per unit)
FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 Monthly Use Current Rates Monthly Use 1/1/2024 7/1/2024 7/1/2025 7/1/2026 7/1/2027 Tier 1 (0-6 hcf) $2.89 Tier 1 (0 - 10 hcf) $3.41 $3.69 $3.98 $4.26 $4.60 Tier 2 (7-12 hcf) $3.15 Tier 2 (11 - 16 hcf) $4.50 $4.86 $5.24 $5.61 $6.06 Tier 3 (13+ hcf) $3.37 Tier 3 (17+ hcf) $8.51 $9.19 $9.92 $10.62 $11.47 All Consumption $3.29 All Consumption $4.25 $4.59 $4.95 $5.30 $5.73 Single Family Residential
All Othe
r
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4. SEWER RATE STUDY
A. REVENUE REQUIREMENTS AND FINANCIAL PROJECTIONS
To determine whether additional sewer rate revenue is required, projected operating and capital expenses are compared with projected revenue from current rates. Annual surpluses and deficits are then applied to the reserve funds. Rates are then increased so that the expenses are covered and operating and capital reserves are maintained. Th e following sections summarize the methodology for determining the annual revenue requirements, the necessary annual revenue increases, and the projected impact these results will have on the Sewer Enterprise fund balance.
Assumptions
A spreadsheet model was developed to derive revenue requirements for FY 2022-23 through FY 2032-33.
The revenue requirements represent the costs that must be covered by revenue from rates and other sources, such as reserves. The City’s Council-approved operating and capital budget for FY 2022-23 served as the starting point for projecting the City’s expenses and revenues over the ten-year financial planning period. We worked with City staff to proj ect beyond FY 2022-23. The assumptions shown in Figure 4-1 were used to project expenses, account growth, and water demand through FY 2032-33. The application of these assumptions to the O&M and capital expenses are summarized in Figure 4-2 and are described in more detail below. The revenue from current rates (plus growth) is also shown (dotted black line).
Figure 4-1. Projection Assumptions
FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 202 7-28 FY 2028-29 FY 2029-30 FY 2030-31 FY 2031-32 FY 2032-33 Annual Account Growth Rate 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% Annual Water Demand Increases 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% General Inflation Budgeted 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% Salaries & Wages Budgeted 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% 3.00% Benefits Budgeted 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% Utilites Budgeted 4.03% 4.03% 4.03% 4.03% 4.03% 4.03% 4.03% 4.03% 4.03% 4.03% Construction Cost Inflation 2.92% 2.92% 2.92% 2.92% 2.92% 2.92% 2.92% 2.92% 2.92% 2.92% 2.92% Interest on Fund Balance 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40%
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Figure 4-2. Projected Annual Revenue Requirements
1 Sewer Non-Operating Revenues include sewer reconstruction fees and the sale of surplus Sewer Enterprise property (e.g., vehicles, computers, equipment) which is not longer needed. These non-operating revenues reduce the necessary revenue that needs to come from rates to cover operating and capital costs.
Revenue Projections
Given the projected O&M and capital costs in Figure 4-2, HF&H developed a rate revenue adjustment scenario that maintains adequate fund balances for the ongoing operations of the Sewer Enterprise. These rate revenue adjust ments are shown in Figure 4-3. Figure 4-4 shows the projected sewer rate revenue associated with the proposed rate revenue adjustments.
Figure 4-3. Sewer Rate Revenue Adjustments
FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29 FY 2029-30 FY 2030-31 FY 2031-32 FY 2032-33 Salaries & Benefits $1,531,169 $1,589,876 $1,650,984 $1,714,595 $1,780,819 $1,849,768 $1,921,562 $1,996,326 $2,074,188 $2,155,284 $2,239,7 57 Operations $1,987,412 $2,047,042 $2,108,460 $2,171,722 $2,236,881 $2,303,996 $2,373,124 $2,444,326 $2,517,665 $2,593,205 $2,671,011 Capital Projects $2,781,278 $3,220,893 $3,368,838 $3,467,208 $3,568,450 $3,672,649 $3,779,890 $3,779,890 $3,779,890 $3,779,890 $3,779,890 Non-Op Revenue1 ($101,300) ($104,339) ($107,469) ($110,693) ($114,014) ($117,434) ($120,957) ($124,586) ($128,324) ($132,174) ($136,139) Net Revenue Requirement $6,198,560 $6,753,472 $7,020,812 $7,242,831 $7,472,136 $7,708,978 $7,953,619 $8,095,956 $8,243,419 $8,396,206 $8,5 54,519 $0.0
$1.0
$2.0
$3.0
$4.0
$5.0
$6.0
$7.0
$8.0
$9.0
$10.0
FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29 FY 2029-30 FY 2030-31 FY 2031-32 FY 2032-33 Millions
Salaries & Benefits Operations Capital Projects Revenue at Current Rates Fiscal Year
Effective
Date
Overall
Rate
Revenue
Increase
FY 2023-24 1/1/2024 40.0%
FY 2024-25 7/1/2024 30.0%
FY 2025-26 7/1/2025 10.0%
FY 2026-27 7/1/2026 10.0%
FY 2027-28 7/1/2027 4.0%
FY 2028-29 7/1/2028 4.0%
FY 2029-30 7/1/2029 3.0%
FY 2030-31 7/1/2030 3.0%
FY 2031-32 7/1/2031 3.0%
FY 2032-33 7/1/2032 3.0%
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Figure 4-4. Projected Sewer Rate Revenue
Sewer Reserve Fund Balance Projections
The rate adjustments in Figure 4-2 were developed by analyzing the City’s projected expenses over the course of the planning period against its projected revenues.
In addition to covering annual expenses, sewer service charges need to generate revenue to maintain adequate operations and capital reserves. To determine what constitutes adequate reserve amounts, the City’s Sewer Enterprise fund balance is divided into operating and capital reserves. Recommended target balances are set to fund each reserve. The result ing cash balances with the recommended revenue increase shown in Figure 4-2, is represented by the solid green line in Figure 4-5. In addition, Figure 4-5 shows the projected annual fund balances without the revenue increases (dotted green line). As shown, without any rate increase, the fund balance will be fully depleted sometime before the end of FY 2024-
25. The cash reserve targets used in Figure 4-5 are as follows:
Operating Reserve. The operating component of the reserves provides working capital for month- to-month O&M expenditures. With sufficient working capital, the City can operate without cash flow constraints. The City’s reserve policy is two months of operating expenses. The City’s reserves should never drop below this minimum balance. The operating reserve target is represented by the red line in Figure 4-5.
Capital Reserve. The capital component of the reserves provides working capital for the City’s capital improvement projects. The fund balance needs to be sufficient to at least pay contractors without delays caused by cash flow limitations. The fund balance can be larger so that the City can fund larger construction projects on a pay-as-you-go basis, thereby eliminating financing costs. The City’s reserve policy for the capital reserve is 25% of accumulated depreciation of capital assets.
Months
Increase
In Effect FY 2022-23 FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 FY 2028-29 FY 2029-30 FY 2030-31 FY 2031-32 FY 2032-33 Sewer Rate Revenue at Current Rates $3,270,000 $3,278,175 $3,286,370 $3,294,586 $3,302,822 $3,311,079 $3,319,357 $3,327,655 $3,335,974 $3,344,314 $3,352,675 (including growth)
Increase in Rate Revenue 0.0% 40.0% 30.0% 10.0% 10.0% 5.0% 3.0% 3.0% 3.0% 3.0% 3.0% Revenue from Rate Increases
FY 2023-24 (eff. Jan 1, 2024) 6 $655,635 $1,314,548 $1,317,834 $1,321,129 $1,324,432 $1,327,743 $1,331,062 $1,334,390 $1,337,726 $1,341,07 0 FY 2024-25 (eff. Jul 1, 2024) 12 $1,380,275 $1,383,726 $1,387,185 $1,390,653 $1,394,130 $1,397,615 $1,401,109 $1,404,612 $1,408,124 FY 2025-26 (eff. Jul 1, 2025) 12 $599,615 $601,114 $602,616 $604,123 $605,633 $607,147 $608,665 $610,187 FY 2026-27 (eff. Jul 1, 2026) 12 $661,225 $662,878 $664,535 $666,197 $667,862 $669,532 $671,206 FY 2027-28 (eff. Jul 1, 2027) 12 $364,583 $365,494 $366,408 $367,324 $368,242 $369,163 FY 2028-29 (eff. Jul 1, 2028) 12 $230,261 $230,837 $231,414 $231,993 $232,573 FY 2029-30 (eff. Jul 1, 2029) 12 $237,762 $238,357 $238,953 $239,550 FY 2030-31 (eff. Jul 1, 2030) 12 $245,507 $246,121 $246,736 FY 2031-32 (eff. Jul 1, 2031) 12 $253,505 $254,138
FY 2032-33 (eff. Jul 1, 2032) 12 $261,763
al Revenue from Rate Increases $0 $655,635 $2,694,823 $3,301,175 $3,970,653 $4,345,162 $4,586,287 $4,835,514 $5,093,110 $5,359,348 $5,634,509 Total Current Revenue $3,270,000 $3,278,175 $3,286,370 $3,294,586 $3,302,822 $3,311,079 $3,319,357 $3,327,655 $3,335,974 $3,344,314 $3,352,675 Total Revenue with Rate Increases $3,270,000 $3,933,810 $5,981,193 $6,595,761 $7,273,475 $7,656,241 $7,905,644 $8,163,169 $8,429,084 $8,703,662 $8,987,184 Total Revenue Requirement $6,198,560 $6,753,472 $7,020,812 $7,242,831 $7,472,136 $7,708,978 $7,953,619 $8,095,956 $8,243,419 $8,396,206 $8 ,554,519 Transfer to/(from) Reserves ($2,928,560) ($2,819,662) ($1,039,619) ($647,070) ($198,661) ($52,737) ($47,975) $67,213 $185,665 $307,456 $432,665
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Total Reserve Target. The total reserve target for the City is the sum of the target balances for the operating reserve and capital reserve. The targ et balance is represented by the blue line in Figure 4-5.
Figure 4-5. Sewer Enterprise Projected Fund Balance
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B. COST-OF-SERVICE ANALYSIS
The total revenue requirement for FY 2022-23 of $6,198,560, as shown in Figure 4-2, was used as the starting point for the cost-of-service and rate design analysisTo reduce rate impacts to consumers, our analysis assumes the use of reserves to partially offset the rate increases to be effective January 1, 2024.
The need for additional rate increases to cover operating and capital cost increases, and rebuild reserves, will be spread over the five-year planning period, as shown in Figure 4-3.
Analytical Approach
The sewer cost-of-service analysis differs from th e water cost-of-service analysis because providing wastewater collection services should only account for the consideration of account versus flow, which is different from providing water service where peak de mands and capacity are a primary consideration.
The cost-of-service analysis in this report follows wastewater rate-making techniques promulgated by the Water Environment Federation, which is the wastewater industry’s equivalent to the American Water Works Association.
The analytical procedure contains the following steps:
1. Service function cost classification – The City’s budget is summarized into service function cost categories, which is needed for allocating costs that will be used for calculating rates.
2. Demand service function allocation percentages – Account and conveyance allocation factors are needed to apportion costs related to the demand service functions and to customer classes.
3. Service function allocations – Costs from Step 1 are allocate d to the account and conveyance service functions from Step 2.
4. Customer class allocations – The costs allocated to the demand service function in Step 3 are further apportioned between three customer classes.
This sequence of steps is further explained below. The steps constitute the cost-of-service analysis, which converts the revenue requirement for FY 2022-23 in in to the eventual cost-of-service for sewer service charges.
Allocation Factors
Conveyance Services: Collection system O&M and capital costs including lift stations sewer mains.
Customer Accounts: Billing, accounting, customer service, and other costs related to the operations of the sewer system that aren’t directly attributable to conveyance/flow.
Composite Services: Indirect allocations for costs that are not directly related to specific service functions:
personnel, overhead, non-operating revenue.
The allocation factors that apply to the three different cost categories are summarized in Figure 4-6. With these allocations factors, rates can be designed to proportionately charge customers based on their demands.
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Figure 4-6. Allocation Factors
Cost Allocations
Figure 4-7 shows the FY 2022-23 net revenue requirement a llocated into flow and customer services.
Each line item was classified according to the associated function. The allocation factors that are summarized in Figure 4-6 allocate the costs across the services ba sed on the allocation factor column in Figure 4-7.
Figure 4-7. Net Revenue Requirement Allocations
Cost of Service by Customer Class
The results of the cost-of-serv ice allocations are shown in Figure 4-8. Additionally, Figure 4-8 calculates the unit costs of the sewer system on a per account and per hundred cubic feet (HCF; which is 748.052 gallons) of flow basis. The units of service for flow are based on winter water use of each customer class.
The unit costs multiplied by the units of service for each customer class results in the revenue that needs to be generated by each customer class.
Cost Allocation Factors Accounts Flow
Conveyance 0% 100%
Accounts 100% 0%
Rev. Req. Composite 15% 85%
Rev Req't Allocation Cost Allocation
Revenue Requirement Allocation FY 2022-23 Type Accounts Flow Total Operations & Maintenance
Revenue Collection $186,696 Accounts $186,696 $0 $186,696 Building & Safety $213,808 Accounts $213,808 $0 $213,808 Sanitary Sewer Maintenance $2,465,532 Conveyance $0 $2,465,532 $2,465,532 Maintenance $86,025 Accounts $86,025 $0 $86,025
Engineering $474,969 Accounts $474,969 $0 $474,969
Post Employment $66,929 Accounts $66,929 $0 $66,929
Storm Drain Maintenance $24,622 Conveyance $0 $24,622 $24,622 Non Operating Revenue ($101,300) Accounts ($101,300) $0 ($101,300) Total O&M $3,417,281 $927,128 $2,490,153 $3,417,281
O&M Composite 100% 27% 73% 100%
Capital Improvements $2,781,278 Conveyance $0 $2,781,278 $2,781,278 Total Revenue Requirement $6,198,560 $927,128 $5,271,432 $6,198,560 Rev. Req. Composite 100% 15% 85% 100%
Transfer from Operating Reserves ($2,928,560)Rev. Req. Composite ($438,029) ($2,490,531) ($2,928,560) Net Revenue Requirement $3,270,000 $489,099 $2,780,901 $3,270,000
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Figure 4-8. Cost-of-Service Allocation to Customer Classes
1. Source: Figure 4-7
Total
Units of Service by Customer Class Accounts Flow (HCF)
Single Family (accounts/flow) a 10,615 1,142,472
Multi Family (dwelling units/flow) b 8,630 928,998
Commercial & Institutional (accounts/flow) c 907 641,766 d = a+b+c 20,152 2,713,236
Functional Costs [1]
Operations & Maintenance $927,128 $2,490,153 $3,417,281 Capital Improvements $0 $2,781,278 $2,781,278
Transfers ($438,029) ($2,490,531) ($2,928,560)
e $489,099 $2,780,901 $3,270,000
Unit Cost Calculations
Units of Service Total f = d 20,152 2,713,236
Unit Cost of Service g = e ÷ f $24.27 $1.02
per account/ per HCF
dwelling unit
Cost of Service by Customer Class
Single Family h = a * g $257,631 $1,170,964 $1,428,595
Multi Family i = b * g $209,454 $952,166 $1,161,620
Commercial & Institutional j = c * g $22,013 $657,771 $679,784 $489,099 $2,780,901 $3,270,000
15% 85% 100%
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C. RATE DESIGN
The City’s sewer customers currently pay a fixed monthly sewer rate based on water meter size and customer class.
Single Family. Water meter sizes for single family customers range from 5/8” to 1.5”. The current monthly sewer service rate increases as the water meter size increases. The size of a customer’s water meter is not necessarily indicative of how much wa ter is discharged into th e City’s sewer collection system. Typically, single family customers only “si ze up” their water meters for fire protection requirements or for increased flow for outdoor irrigation purposes, neither of which contributes to an increase in wastewater volume. Therefore, we recommend charging single family customers based on a fixed monthly sewer rate regardless of meter size.
Multi Family. Water meter sizes for multi family custom ers range from 3/4” to 4”. The current monthly sewer service rate increases as the water meter size increases. The size of a customer’s water meter is not necessarily indicative of how much wa ter is discharged into th e City’s sewer collection system. Like single family customers, multi family customers may “size up” their water meters for non-wastewater purposes (e.g., irrigation and fire flow) but also to meet the water demands for each dwelling unit. Therefore, we recommend charging multi family customers based on a fixed monthly sewer rate based on the number of dwelling units regardless of meter size.
Commercial & Institutional. Water meter sizes for commercial and institutional (C&I) customers range from 3/4” to 6”. The current monthly sewer service rate increases as the water meter size increases. Unlike residential customers, typically C&I customers have separate irrigation and fire flow meters. As such, the City’s current rate structure for C&I customers is appropriate. Therefore, we recommend that C&I customers maintain their current rate structure based on meter size.
Fixed and Variable Costs
Since the proposed sewer rates will be a fixed amou nt per month and not based on the flows of each customer, since sewered water use is not metered, the “flow” portion of the cost-of-service needs to be reallocated to the fixed portion. Figure 4-9 shows the annual per unit cost for each customer class after the variable costs have been reallocated to be recove red by the fixed monthly charge for each customer class.
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Figure 4-9. Unit Costs by Customer Class
1 Source: Figure 4-8
Residential Rate Design
Figure 4-9 calculated the annual per unit rate for each the single family and multi family customer classes.
The single family customers will be charged on a per account basis and the multi family customers will be charged on a per dwelling unit basis. Figure 4-10 shows the derivation for the monthly per unit rates for FY 2023-24.
Figure 4-10. Derivation of Monthly Residential Rates
1 Source: Figure 4-9
2 Source: Figure 4-3
Commercial and Institutional Rate Design
Figure 4-9 calculated the annual per unit rate for each the commercial and institutional customer class.
This class will be charged on a per EMU basis. Meter size can be used a proxy for water use and therefore wastewater volume. The capacity multipliers are the same multipliers used in the water rates. Figure 4- 11 shows the derivation for the monthly per unit rates for FY 2023-24.
Customer Class Total Costs1
Single Family $1,428,595
Multi Family $1,161,620
C&I $679,784
Total $3,270,000
Customer Class Units
Single Family (accounts) 10,615
Multi Family (dwelling units) 8,630
C&I (EMUs) 2,898
Unit Costs Annual Cost per Unit
Single Family $134.58
Multi Family $134.60
C&I $234.57
Unit Cost by Customer Class
Customer Type
FY 2023-24
Annual Cost
per Unit1
FY 2022-23
Cost per
Month
Rate Revenue
Increase2
FY 2023-24
Proposed
Rate
Single Family $134.58 $11.22 40.0% $15.70
Multi Family $134.60 $11.22 40.0% $15.70
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Figure 4-11. C&I Monthly Rate Calculation
1 Source: Figure 4-9
2 Source: Figure 4-3
Proposed Rates
Figure 4-12 shows the summary of the proposed sewer rates through FY 2027-28.
Figure 4-12. Proposed Sewer Rates
C&I Meter Size
Capacity
Multiplier Rate per EMU 1
FY 2022-23
Annual Cost
FY 2022-23
Cost per
Month
Rate Revenue
Increase2
FY 2023-24
Proposed Rate
3/4" Meters 1.00 $234.57 $234.57 $19.55 40.0% $27.37
1" Meters 1.67 $234.57 $390.95 $32.58 40.0% $45.61
1.5" Meters 3.33 $234.57 $781.90 $65.16 40.0% $91.22
2" Meters 5.33 $234.57 $1,251.04 $104.25 40.0% $145.95
3" Meters 10.67 $234.57 $2,502.08 $208.51 40.0% $291.91 4" Meters 16.67 $234.57 $3,909.50 $325.79 40.0% $456.11 6" Meters 33.33 $234.57 $7,819.01 $651.58 40.0% $912.21 8" Meters 53.33 $234.57 $12,510.41 $1,042.53 40.0% $1,459.54 Current Current Proposed
Customer Class Units FY 2022-23 Units FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 Single Family effective date 1/1/2024 7/1/2024 7/1/2025 7/1/2026 7/1/2027 5/8", 3/4" account $10.17 per account/DU $15.71 $20.42 $22.46 $24.71 $25.70 1" account $12.42 per account/DU $15.71 $20.42 $22.46 $24.71 $25.70 1 1/2" account $12.86 per account/DU $15.71 $20.42 $22.46 $24.71 $25.70 Multi Family
3/4" account $29.01 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 1" account $34.76 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 1 1/4" account $57.25 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 1 1/2" account $84.15 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 2" account $161.22 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 3" account $413.02 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 4" account $534.30 per dwelling unit $15.71 $20.42 $22.46 $24.71 $25.70 Commercial
3/4" account $27.09 account $27.37 $35.58 $39.14 $43.05 $44.78 1" account $40.68 account $45.61 $59.30 $65.23 $71.75 $74.62 1 1/4" account $40.68 account $91.22 $118.59 $130.45 $143.50 $149.24 1 1/2" account $78.41 account $145.95 $189.74 $208.71 $229.58 $238.76 2" account $198.97 account $291.91 $379.49 $417.44 $459.18 $477.55 3" account $270.68 account $456.11 $592.94 $652.23 $717.45 $746.15 4" account $386.69 account $912.21 $1,185.88 $1,304.46 $1,434.91 $1,492.31 6" account $1,052.20 account $1,459.54 $1,897.40 $2,087.15 $2,295.86 $2,387.69 Institutional
3/4" account $46.29 account $27.37 $35.58 $39.14 $43.05 $44.78 2" account $68.48 a ccount $291.91 $379.49 $417.44 $459.18 $477.55 3" account $73.29 account $456.11 $592.94 $652.23 $717.45 $746.15 4" account $168.28 account $912.21 $1,185.88 $1,304.46 $1,434.91 $1,492.31 Proposed
Monthly Sewer Rates
City of Monterey Park Utility Rate Study
Final Report 5. Customer Bill Impacts
HF&H Consultants, LLC Page 32 October 30, 2023
5. CUSTOMER BILL IMPACTS
Note: The following monthly bill comparisons are ba sed on “typical” customers or customers that are most representative of a group of customers. The typical customer is based on the most common meter sizes for the class and the average wa ter use for customers of that type. Customer bills for customers using more or less water than average will see different results.
BILL COMPARISONS
Figure 5-1 shows the comparison of a sample single family residential customer bill (including both water and sewer charges) with a ¾” meter and using 10 hcf per month, which is the average water use by single family customers.
Figure 5-1. Single Family Residential Combined Monthly Bill Impact
Figure 5-2 shows the comparison of a sample 10-unit multi family residential customer with a 2” meter and using 90 hcf per month.
Current FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 Assumptions
Meter Size 3/4" meter 3/4" meter
Water Consumption 10 10
Water
Fixed Service Charge $19.20 $27.18 $29.36 $31.71 $33.93 $36.64 Consumption Charge $21.76 $34.15 $36.88 $39.83 $42.62 $46.03
37.5% Surcharge $15.36 n/a n/a n/a n/a n/a
Total $56.32 $61.33 $66.24 $71.54 $76.55 $82.67
Increase/(Decrease) $5.01 $4.91 $5.30 $5.01 $6.12
Sewer
Charge per account $10.17 $15.71 $20.42 $22.46 $24.71 $25.70 Total $10.17 $15.71 $20.42 $22.46 $24.71 $25.70
Increase/(Decrease) $5.54 $4.71 $2.04 $2.25 $0.99
Total Monthly Bill $66.49 $77.04 $86.66 $94.00 $101.25 $108.37 Increase/(Decrease) $10.55 $9.62 $7.34 $7.25 $7.11
City of Monterey Park Utility Rate Study
Final Report 5. Customer Bill Impacts
HF&H Consultants, LLC Page 33 October 30, 2023
Figure 5-2. Multi Family Residential Combined Monthly Bill Impact
Figure 5-3 shows the comparison of a sample commercial or institutional customer with a 1” meter and using 53 hcf per month.
Figure 5-3. Commercial and Institutional Combined Monthly Bill Impact
Current FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 Assumptions
Meter Size 2" meter 2" meter
Water Consumption 90 90
Dwelling Units 10 10
Water
Fixed Service Charge $42.15 $118.52 $128.00 $138.24 $147.91 $159.75 Consumption Charge $215.10 $382.31 $412.90 $445.93 $477.14 $515.31
37.5% Surcharge $96.47 n/a n/a n/a n/a n/a
Total $353.72 $500.83 $540.89 $584.16 $625.06 $675.06
Increase/(Decrease) $147.11 $40.07 $43.27 $40.89 $50.00 Sewer
Charge per account $161.22 $157.08 $204.20 $224.62 $247.09 $256.97 Total $161.22 $157.08 $204.20 $224.62 $247.09 $256.97
Increase/(Decrease) ($4.14) $47.12 $20.42 $22.46 $9.88
Total Monthly Bill $514.94 $657.91 $745.10 $808.79 $872.14 $932.03 Total Increase/(Decrease) $142.97 $87.19 $63.69 $63.35 $59.89 Increase/Decrease per DU $14.30 $8.72 $6.37 $6.34 $5.99 Current FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27 FY 2027-28 Assumptions
Meter Size 1" meter 1" meter
Water Consumption 53 53
Sewered Flow 53 53
Water
Fixed Service Charge $20.75 $41.23 $44.53 $48.10 $51.46 $55.58 Consumption Charge $126.67 $225.14 $243.15 $262.60 $280.98 $303.46
37.5% Surcharge $55.28 n/a n/a n/a n/a n/a
Total $202.70 $266.37 $287.68 $310.70 $332.45 $359.04
Increase/(Decrease) $63.67 $21.31 $23.01 $21.75 $26.60
Sewer
Charge per account $40.68 $45.61 $59.30 $65.23 $71.75 $74.62 Total $40.68 $45.61 $59.30 $65.23 $71.75 $74.62
Increase/(Decrease) $4.93 $13.68 $5.93 $6.52 $2.87
Total Monthly Bill $243.38 $311.98 $346.98 $375.92 $404.19 $433.66 Increase/(Decrease) $68.60 $34.99 $28.94 $28.27 $29.47