ACTION MINUTES OF THE CITY COUNCIL
CITY OF VILLA PARK, CALIFORNIA
May 16, 2022
Special Meeting
SPECIAL SESSION
5:00 p.m. - City Council Chambers
CALL TO ORDER / ROLL CALL - Mayor Zimmerman called the General Session to order at 5:02 p.m.
COUNCILMEMBERS
PRESENT: Collacott, Miles, Pitts, Rossini, and Zimmerman ABSENT: None
PLEDGE OF ALLEGIANCE TO THE FLAG - The Pledge of Allegiance was led by Mayor Zimmerman.
NEW BUSINESS
1. 2022-23 First Budget Workshop Presentation.
Mayor Zimmerman opened public comments and hearing no speakers, closed public comment.
City Manager Steve Franks advised this is the second Budget Workshop for Fiscal Year 2022-23.
Finance Director Jim Gorzo presented the Fiscal Year 2021-22 Year-End Projections. He advised revenue projections are $776,000 over budget while expenditures are $1.2 million under budget. He noted the difference is due to the receipt of the City's first increased by $100,000 over the initial projection. He noted this is partially offset by Grant revenues that have not yet been received for the Villa Park Knowles project for $224,000.
He explained expenditures are $1.2 million under budget due to a sewer improvement project that was not done this fiscal year but will be budgeted for the Fiscal Year 2022-
23. Finance Director Gorzo presented a brief overview of the estimated financing for the Fiscal Year 2022-23. He reported that $9.4 million is available in Fiscal Year 2022-23 to cover operational costs and Capital Improvement Projects (CIP).
May 16, 2022 Villa Park City Council Meeting Minutes
Finance Director Gorzo presented the Fiscal Year 2022-23 Revenue Assumptions which included Property Tax Revenues, Sales Tax Revenues, Building Permit Fees, Permit/License Revenue, Technology Fees, and Passport Processing fees. He provided a brief overview of Restricted Revenues which included Sewer Improvement Funding, Measure M2 Road Funding, State Gas Tax, Air Quality Management District (AQMD) Funding, Public, Educational, and Governmental Access Channels (PEG) Funding, State Park Grant for Villa Park Knowles, and Leveraging Educational Assistance Partnership (LEAP) LEAP/CalRecycle Grants. He reported the proposed Revenue change is a $335.9k increase over the Fiscal Year 2021-22 budget.
City Manager Franks presented the Revenues by Source and noted it is displayed in the new reporting format from the new budgeting system. He advised the City is 82.5% funded by Sales Tax and Property Tax.
Finance Director Gorzo reported the City's budget will have a public-facing website with summaries of the budget for public review.
Councilmember Miles inquired if other cities of similar size are funded by Sales and Property Tax at such a high rate. City Manager Franks agreed that 82% is very high and noted the City is almost entirely Property Tax dependent because there is limited retail in the City. Finance Director Gorzo greed the City is very unique in Orange County and probably statewide.
City Manager Franks reported the expenditures for Villa Park Knowles will be recorded this year but noted revenues for the State get recorded in arrears because the City has to show proof of expenditures before the City receives the grant funding. Finance Director Gorzo explained the General Fund will cover the expenditure until the City receives the funding from the State.
City Manager Franks reported the $10,000 for the Handicap Accessibility Ramps only covers projects that are not incorporated into street projects. He advised the majority of the $83,000 for the completion of the Housing Element will come from the LEAP grant funding. He noted the final Housing Element will go to the Department of Housing and Community Development (HCD) in June and will come back to the City Council for adoption.
Councilmember Collacott inquired if the City is anticipating any additional expenses to complete the Housing Element. City Manager Franks advised the City does not anticipate additional expenses and that the $83,000 should cover everything. He clarified staff time is the only other expense outside of consultant fees.
City Manager Franks provided an overview of the City Council priorities that would be continuing. He reported the Sewer Maintenance/Pump Station Improvement Project will continue and noted the Sewer Assessment was awarded in April and the project will come May 16, 2022 Villa Park City Council Meeting Minutes
back in late summer or early fall. He reported the Street Rehabilitation Project has been increased to $2 million due to the rising cost of materials. He confirmed no new streets have been added beyond what has already been approved by the City Council.
Councilmember Collacott inquired if the increase is a guess or if asphalt companies have been contacted. City Manager Franks reported the City has received estimates from asphalt companies along with additional information from other cities.
City Manager Franks reported next year's Street Slurry Seal project has increased by $100,000. He advised the current year's slurry seal is starting this week. He reported that $40,000 has been appropriated for Street Pothole repair and $25,000 for DG Trail Repair.
He advised a State of the City is not being planned this year but could be resurrected in the future. He advised that $7,500 has been appropriated to the Winter Wonderland with Villa Park Community Services Foundation (CSF) contributing $5,500. Lastly, he reported that $10,000 has been appropriated for City Council travel.
Councilmember Pitts inquired if there has been a review of inflation impacts on the City such as fuel costs. Finance Director Gorzo confirmed staff has accommodated for inflation and has added 3% to 4% to most costs. City Manager Franks advised money has been set aside in Contingency Funds for inflation impacts but the staff has always been very conservative.
City Manager Franks provided a brief overview of issues within the Contracted/External Mandates. He advised the City's largest contract is with the Orange County Sheriffs Department (OCSD) for law enforcement, and although it has increased by 3.5%, it includes the same level of service. He reported the CJPIA Insurance Premium is increasing by $26,000 due to the impact of the City's settlement with the Mesa-Henderson storm drain. He advised the NV5 Engineering Services increase is $7,500 and is subject to City Council approval. He advised the Homeless Shelter Operational Contribution is increasing by $7,500 but noted there is legal action pending and is just a guess. He advised there is a $15,000 increase in the budget for Municipal Election costs due to the Registrar of Voters anticipating increased transportation and printing costs. He advised new technology equipment will include purchasing computers and cell phones for new members of the City Council. He noted the Budget/Financial System Annual Subscription of $13,000 will be paid through American Rescue Plan Act (ARPA) funds. Lastly, he advised that $82,000 in AQMD funds will be used for the fleet replacement and installation of charger stations.
Councilmember Collacott reported the City's current sedans were donated by Tom White for support of a Law Enforcement Advisory Committee initiative that did not pan out. He inquired how many miles have been put on the vehicles. City Manager Franks advised he would be shocked if they were driven 1,000 miles each per year. He noted that OCSD uses the vehicles for special events and vacation checks.
May 16, 2022 Villa Park City Council Meeting Minutes
Mayor Zimmerman inquired if the AQMD funding would replace the City's maintenance vehicles. City Manager Franks reported those vehicles are from 2015 and still have a few years of useful life left. He noted electric work trucks are very difficult to obtain but hopes they will become more readily available when the time comes for replacement.
Mayor Zimmerman reported the Ford F-150 Lightning is sold out and will take more than a year to receive once purchased so the City will need to get ahead of that. City Manager Franks advised Ford does not make anything out there higher than an F-150 and the City would need higher-powered trucks. He noted other manufacturers could be investigated but there is a high demand for these trucks.
Finance Director Gorzo advised that $80,000 is available from AQMD but it has not been budgeted. City Manager Franks reported Governor Newsom signed into law that all new vehicles sold in California must be electric by 2035.
City Manager Franks reported the Merit Pool for City staff was increased to 4% which resulted in a $5,000 increase to the budget. He reported the new Finance Director will be starting next Monday to work on the transition with Finance Director Gorzo. He reported the CaPERS contribution rate adjustments have increased by $20,000 and noted the City is 80%-85% funded which is considered well-funded. He advised CaPERS is expecting a return of 7% but they are underperforming. He reported if the City Council wanted to keep the 2022-23 Reserves at 50% funded, $70,000 would be needed.
Councilmember Pitts inquired if the staff has all the tools needed to retain City employees.
He inquired if the Merit Pool needs to increase beyond 4% to keep pace with inflation. He advised the City may need to explore opportunities for more flexible work schedules. He noted he is talking with other cities to see what they are doing. He advised the disadvantage of being a small city is that there is not a lot of promotion opportunity. He believes the key is to create an environment staff enjoys with the incentives they appreciate.
City Manager Franks presented Expenditures by Expense and Expenditures by Function reports to the City Council. He advised Public Safety is the number one growth area in the General Fund.
City Manager Franks reported the City received $350,000 from the Coronavirus Aid, Relief, and Economic Security (CARES) Act. He advised that $37,000 was used for Recovery/Preparation Reimbursement Funds, $250,000 in Business Recovery Funds, and $30,000 in Meal Gap Services Funds. He reported the City submitted a claim for $35,000 to Federal Emergency Management Agency (FEMA) but was denied. He advised the City received $1.4 million in American Rescue Plan Act (ARPA) funds. He reported some of the ARPA funds were committed to the Street Rehabilitation project, used for the HVAC replacement in City Hall, and for purchasing the Budget System. He advised there May 16, 2022 Villa Park City Council Meeting Minutes
is approximately $800,000 remaining. He advised it will come back to City Council for discussion. He noted the revenue will be recognized this year and it will need to be reviewed next year. He advised it will be used to pay for part of the public safety contract which in turn frees up General Fund monies. He explained the Department of Treasury has encouraged cities to spend the money on public safety. He hopes to bring back an item to the City Council on how to spend the remaining funds in late summer.
City Manager Franks reported next steps include adopting the Fiscal Year 2022-23 Budget on June 26th as part of the regular City Council meeting. He noted the City is in a favorable position and financially sound. He advised the budget is being developed in the new system. He noted demographic data is also being included in the budget so residents can see an additional level of data.
Mayor Zimmerman inquired how the demographic information is obtained. Finance Director Gorzo advised the system uses U.S. Census data to leverage demographic information.
Mayor Zimmerman thanked Finance Director Gorzo and City Manager Franks for preparing the budget. He thanked City Manager Franks for highlighting the new features in the new budget system that helps to show the public the usefulness of the tool.
Councilmember Miles thanked Finance Director Gorzo and City Manager Franks for their work and appreciated the new charts and visuals.
Councilmember Collacott clarified the third Tuesday in June is the 28th. City Manager Franks thanked him for the correction and confirmed the Budget will be adopted on June 28th.
Mayor Pro Tem Rossini thanked staff and the City Council for incorporating all of his requests.
Councilmember Pitts thanked the staff for their hard work and noted they did a fantastic job with the budget. He expressed inflation concerns but noted staff has already anticipated it in the budget.
Mayor Zimmerman reported the budget will be available on the website and encouraged residents to contact staff or the City Council with any questions they may have. Finance Director Gorzo clarified the budget has not been made public on the City's website yet but will once the City Council approves the budget.
Mayor Zimmerman inquired if any additional training is required for staff on the new budget system. City Manager Franks advised staff just simply needs to work through building a budget in the new system. Finance Director Gorzo confirmed staff is working with a dedicated integration team with the vendor.
May 16, 2022 Villa Park City Council Meeting Minutes
ADJOURNMENT
The meeting was adjourned at 5:52 p.m. to the next regular Council meeting to be held whether in person or via teleconference on Tuesday, May 24, 2022. had Zimmerman, Mayor
City of Villa Park
City of Villa Park
Note: The above minutes are a summary of actions. A DVD recording of this meeting additionally serves as an official record and is available upon request from City Hall.