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03/13/1993, Agenda & BUDGET WORKSHOP NO. 3
�IIIIIIIIIII �� II IIIIIIIIIIIIIIII � � _ CItyOf San WIS OBISPO FINAL STUDY SESSION COUNCIL AGENDA Saturday, March 13, 1993 - 9:00 AM Community Room, City/County Library 990 Palm Street, San Luis Obispo CALL TO ORDER: Mayor Peg Pinard ROLL CALL: Council Members Penny Rappa, Dave Romero, Allen K. Settle, Vice Mayor Bill Roalman, and Mayor Peg Pinard PUBLIC':COMMEN—r PERIOD The Council welcomes your in u.t ::You will have an oPPortunitY to:address the Council regarding.. :. the=City's:budget during the meeting:. :Everyone who addresses the Council today should: complete a speaker stip and'give if to the:City Clerk' . for to the°meeting: If possible;` he time :limit is three minutes. State law does not allow Council:to take action on:issues .not on the' : agenda. Staff maybe asked:to follow-up on such:items STUDY SESSION ► 1. BUDGET WORKSHOP NO. 3 (DUNN/233) A. INTRODUCTION (DUNN - 5 min.) Summary of the agenda and purpose of the budget preparation workshop. The City of San Luis Obispo is committed to include the disabled in all of its services,programs and activities. PIX. Telecommunications Device for the Deaf(805)781-7410 1 Council Agenda Saturday, March 13, 1993 B. FISCAL SITUATION UPDATE (STATLER - 15 min.) , Presentation of updated five-year financial forecast that reflects the best current information with a particular focus on 1993-95 budget decision-making. This forecast will outline key assumptions and define the City's current fiscal situation. C. SPECIAL TASK FORCE RECOMMENDATIONS (Task Force Chairs - 15 min.) - Tax Override for Public Safety Task Force (Willis) - Grant Task Force (Hossli) - Employee Working Group (Slate) - Prevailing Wage Task Force (Peterson) - Revenue Task Force (Statler) D. EIGHT POINT BUDGET STRATEGY FOR PRODUCING A BALANCED BUDGET (DUNN - 1 hr.) 1. Review the City Administrative Officer's eight point strategy for balancing the 1993- 95 Budget. 2. Presentation of specific staff recommendations for balancing the budget. Short Break (10:45 - 11:00 a.m.) E. PUBLIC COMMENT PERIOD (11:00 - Noon) At this time, the Council will receive comments and suggestions from the public on ways to balance the City's budget. (If you plan to speak, please fill out a Speaker Slip.) Lunch Break (12N - 1:00 p.m.) F. PUBLIC COMMENT (1:00 - 2:00 p.m.) At this time, the Council will receive comments and suggestions from the public on ways to balance the City's budget. (If you plan to speak, please fill out a Speaker Slip.) G. SUMMARY OF ISSUES BEFORE THE COUNCIL (DUNN - 15 min.) The City Administrative Officer will present an overview of the policy options before the City Council and specify the direction the staff needs to prepare the budget. 2 Council Agenda Saturday, March 13, 1993 H. STRATEGIC BUDGET DIRECTION/GOAL SETTING (COUNCIL - 2 hours) ♦ RECOMMENDATION: 0 Conceptually approve major City goals and Economic Strategy Task Force referrals as developed at the February 6 and February 9 budget workshops. (Final approval of major City goals will be made with the adoption of the Financial Plan.) 0 Take action on CAO recommendations and provide any other strategic direction to staff on how to prepare the preliminary budget to be scheduled for public hearings starting in May. COMMUNICATIONS''(hot to exceed 1.5:minutes) :..:.:At this time;`>any Council Member.oe the`Gity:Administrative'Officer may`informally update:the`City : Council on:communications and.ask for comment anal/or discussion. Due to State law,"formal action or 'approval may not be oaken. 'Action .on items may be.scheduled at the next Regular meeting. A. ADJOURNMENT. �.IIIIIIIII I � 1111111 IIS City OSM IDIS OBISPO �► STUDY SESSION COUNCIL AGENDA Saturday,, March 13, 1993 - 9:00 b:atrdist.wD(san (2/16/93) Community Room, City/County Libra Agenda Distribution List 990 Palm Street, San Luis Obispo I. Unpaid Subscriptions: (All mtgs.unless o/w noted) CALL TO ORDER: Mayor Peg Pinard AIA PresidentASI President B.I.A. , Lynn Block ROLL CALL: Council Members Penny Rappa, Dave Romero, Chamber of Commerce Vice Mayor Bill Roalman, and Mayor Peg Pinari. H.Ovitt, Co.Spvrs.Chair Paul Hood, Co.Administration g Authority - ousin A ty of PUBLIC COMMENT PERIOD (Not to exceed 15 minutes total) ;:I xcsx The Council welcomes our input. .You will have an: o ortunl 'to KCOY Y P PP,; ty::. ..I KCPR: (2)Gen.Mgr:& News Dir. the City's budget: later in the meeting lf'you wish to present an'i xDDB budget, you'may speak at this time. .Everyone who addressesthe i KEPT a speaker slip and give ltto the City Clerk'prior to the meeting .Tib Wr.T.0 law does notallow Council to take action on issues not on'the`ai KKJG follow=up on such items KSBYKVEC Library(front desk) Mustang Daily I- Pacific Gas & Elec.Co. Planning Commission RRM Design Grp./DeAnn Smith So.Calif.Gas Co./Vic Sterling STUDY SESSION SLO Area Coordinating Cotmcil Telegram-Tribune SLOCityEmp.Assoc/T.Girvin SIDFireBattChiefAssoc/E.Willis ► 1. BUDGET WORKSHOP NO. 3 (STATLER/233) SLOFirefightersAssoc/D.Wtmsch SLOMMgmt-ConfEmpAssoc/D.Cox SIAPoliceOffAssoc/T.DePriest A. INTRODUCTION (DUNN - 5 min.) SLOPolStaffOffAssoc/T.Costa r For L.U,E.6/30/91 on & 1992 Summary of the agenda and purpose of the budget prepare Cits.Ping.Alliance/C.Sand ers Earth Journal/ Terry Dmmivent ECOSLO/Kurt Kupper Res.forQual.Neighbor./D.,Connor r The Citgf 53n Luis Obispo is committed to include the disabled in all of its ser Sierra Club/Tom Knepher Tekcommunicatiolts Device for the Deaf(805)781-7410 __51A Prop.OwnersAssoe.(&St.Rpt) .+•der pa..oIcy of pr:j r. :»r 1 %r. anoloyed b i•. r ,�y of San Luis Gbispu . i:h: City Clerk's w_;kr2,�rt, and that I pos*. s ' ?nda near tiff. .rt.. c: of City F;ali ori 3 �s't� Signature 1. Council Agenda Saturday, March 13, 1993 B. FISCAL SITUATION UPDATE (STATLER - 30 min.) Presentation of updated five-year financial forecast that reflects the best current information with a particular focus on 1993-95 budget decision-making. This forecast will outline key assumptions and define the City's current fiscal situation. C. EIGHT POINT BUDGET STRATEGY (DUNN - 45 min.) Review the City Administrative Officer's eight point strategy for balancing the 1993-95 Budget. 1. Total Cut Solution - Summarize the impacts of the service/expenditure reductions necessary to balance the budget without additional revenues, use of reserves, or labor cost savings. 2. Special Task Force Presentations - (Task Force Chairs - 30 min.) - Tax Override for Public Safety Task Force (Willis) - Grant Task Force (Hossli) - Employee Working Group (Slate) - Prevailing Wage Task Force (Peterson) - Revenue Task Force (Statler) Short Break D. STAFF RECOMMENDATIONS (DUNN - 1 hour) Presentation of specific staff recommendations for balancing the budget. Lunch Break E. PUBLIC COMMENT (1 hour) At this time, the Council will receive comments and suggestions from the public on ways to balance the City's budget. (If you plan to speak, please fill out a Speaker Slip.) F. STRATEGIC BUDGET DIRECTIONIGOAL SETTING (COUNCIL - 2 hours) ♦ RECOMMENDATION: 0 Conceptually approve major City goals and Economic Strategy Task Force referrals as developed at the February 6 and February 9 budget workshops. (Final approval of major City goals will be made with the adoption of the Financial Plan.) 0 Take action on CAO recommendations and provide any other strategic direction to staff on how to prepare the preliminary budget to be scheduled for public hearings starting in May. 2 Council Agenda Saturday, March 13, 1993 .... ..... ......... ........... ................. ............. ..................... . b...C.....O.....M....M.....U....N........I.C.... .A....I............................. ....'h.....o...t...to exceed..............1....5.....:.m......i.h.. 0tb..s) At this'time,:any ouncI em eror the.C Admi.:n.. Cou . i.s...t..r...a....t.u.ve... Officer e.....r.......may.' ay:...informally.update............ i h...6....0.......... i... q communications and :psk-Iqcbmneht and/6r.discus$ion Dueto State;1aw, ..:...:..:�..... il j:: action or:::approval may::ri.pt be...takems...A o.n.:.qm.i ems::may be..:.scne.duI.e..:.......ai the next:RNUIP.(....... v.... ............... meeting ........... ........ ........ . ... ... .: ... .. . ... ....... ............ . ........ .. ..... . . .................... ........... . ............ ....................... .................. .......... XX..: ................ ............. ......... .......... .............. ........ .... .......... .......... ......... ........ A. ADJOURNMENT. 3 KCBX FM 90 KCOY News 12 NEWS MEDIA Attn: Program Director 560 Higuera St., #H 4100 Vachell Lane San Luis Obispo, CA 93401 San Luis Obispo, CA 93401 KCPR Radio, Public Affairs KCPR Radio, News Director KDDB Radio Attn: General Manager CAL POLY UNIVERSITY Attn: Henry Mulak CAL POLY UNIVERSITY Graphic Arts Blvd., #201 P.O. Box 93.7 San Luis Obispo, CA 93407 San Luis Obispo, CA 93407 SLO, CA 93406-0987 KEYT Channel 3 KGLW Radio KKJG FM .98.1 Attn: Kathleen Hernandez Attn: Lee Derr Attn: Connie Gordon 1010 S. Broadway, #F 1025 Grand Avenue 396 Buckley Rd. Santa Maria, CA 93454 Arroyo Grande, CA 93420 San Luis Obispo, CA 93401 KSBY TV Channel 4 � � KVEC Radio Mustang Daily L'6; Attn: Deborah York >� Attn: Cheryl Emery CAL POLY UNIVERSITY n� 467 Hill St. 1329 Chorro St. RM. #226 Graphic Arts San Luis Obispo, CA 93405 San Luis Obispo, CA 93401. San Luis Obispo, CA 93407 New Times Telegram-Tribune 738 Higuera St. San Luis Obispo, CA 93401 PICK-UP Michael Underwood Betsy Lyon, BIA Chair ALL ADVISORY BODIES ARC Grahams Art Store -5/4,11 . 487 Chorro 982 Monterey St. Ora. � � San Luis Obispo, CA 93401 San Luis Obispo, CA 93401 Richard Marshall !Citizen li Pyper Jerry Michael Bicycle Adv. Committee tdv. mittee Cultural Heritage Committee 660 Caudill St. - 544 T ood 2219 Del Campo San Luis Obispo, CA 93401 uis Obisp CA 93401 San Luis Obispo, CA 93401 Stephen Nelson Marion Wolff Kenneth Schwartz Housing Authority Human Relations Commission Jack House Committee 1580 Lizzie St. 3128 Spring Court 201 Buena Vista San Luis Obispo, CA 93401 San Luis Obispo, CA 93401 San Luis Obispo, CA 93405 James Forrer Paul Orton Barry Karleskint Mass Transportation Parks and Recreation Planning Commission 648 Felton Way, #96 33 Las Praderes 623 Jeffrey - San Luis Obispo, CA 93405 San Luis Obispo, CA 93401 San Luis Obispo, CA 93405 Pati Brown Howard Brown Robert-Sorensen Promotion Coord. Committee Tree Committee Persorinel Board 1446 Lizzie St., #A 276 Graves s,w 13yQs 1710 Alta St. • e • - -- - IPA , AIA President ASI. President . Business Improvement Assoc. 31 Hathway Avenue University Union #217-A Attn: Lynn Block San Luis Obispo, CA 93401 CAL POLY UNIVERSITY P.O. Box 1402 San Luis Obispo, CA 93407 San Luis Obispo, CA 93406 Building Industry Assoc. Building Industry Assoc. Chamber of Commerce Attn: Dennis Moresco - Attn: Steve Barish 1039 Chorro St. P.O. Box 6180 P.O. Box 6180 San Luis Obispo, CA 93401 Santa Maria, CA 93456-6180 Santa Maria, CA 93456-6180 Paul Hood Harry Ovitt, Chair Pacific Gas & Electric Co. ,00unty Administration County Board of Supervisors Attn: Bob Boyer county Government Center County Government Center P.O. Box 592 San Luis Obispo, CA 93408 San Luis Obispo, CA 93408 San Luis Obispo, CA 93406 IRM Design Group p So. California Gas Co. SLO Area Coordinating Council kttn: DeAnn Smith Attn: Vic Sterling Attn: Julie Millsap 3026 S. Higuera 1012 Pacific St., #B. County Government Center San Luis Obispo, CA 93401 San Luis Obispo, CA 93401 San Luis Obispo, CA 93408 iall/Hurley/Deutsch Don Smith Citizens Planning Alliance Attn: Keith B. Hall 1111 Vista Del Lago Attn: Carla Sanders 016 E. MainSan Luis Obispo, Ca 93401 P.O. Box 15247 :ants Maria, CAA 93454 San Luis Obispo, Ca 93406 :arch News ECOSLO Res.ForQualityNeighborhoods An: Terry Dunnivent Attn: Kurt Ku er 21 "E" St. pp Attn: Ms. Dottie Connor P.O. Box 1014 216 Albert Dr. :ayucos, CA 93430 San Luis Obispo, CA 93407 San Luis Obispo, Ca 93405 ierra Club SLO Property Owners Assoc. ttn: Tom Knepher P.O. Box 12924 55 Napa San Luis Obispo, CA 93406 lorro Bay, CA 93442 4gdist.wp(san)2/16/93) San Luis Obispo City San Luis Obispo Fire ;nda Dist. Mailing Labels Employees' Assoc. Battalion Chiefs' Assoc. Page 2 of 2 - Tim Girvin, President Erwin Willis, President Utilities Dept. Fire Dept. San Luis Obispo San Luis Obispo Police San Luis Obispo Police Firefighters' Assoc. Officers' Assoc. Staff Officers' Assoc. )an Wunsch., President Tom DePriest, President Tony Costa, `President Fire Dept. Police Dept. Police Dept. San Luis Obispo Mid-Mgmt./ Confidential Employees' Assoc. )ennis Cox, President ?ublic Works Dept. 31®3S�R . -a MEMORANDUM March 5, 1993 To: City Council From: John Dun�n� Subject: PREF THE BUDGET MEMORANDUM The straightforward, central fact at this time is that the City does not have the revenue to support our present level of services and personnel. Like many others, we have been hit hard by the recession. Additionally, we anticipate the third year of major State revenue loss and can reasonably anticipate further loss in future years. Because of this, there is no alternative but to downsize or contract the organization to appropriately respond to today's fiscal reality. To moderate the size of the downsizing, the City has other options, basically to increase its revenue, to reduce its labor costs, and to use some portion of our accumulated reserve. The choices before us are not easy ones. But we know that we must live within our means. What we are essentially doing during this budget season is to re-examine and to change the way we do business. Change in itself is difficult, much more so when it is combined with personnel reductions. We recognize that personnel reductions, painful as they are within the organization, also represent service level reductions, which presents an uncomfortable situation to many of our citizens. We must produce a balanced budget, because State law and common sense require that we do so. We must keep our expenses within the available revenue. We know in advance there is no alternative but to reduce personnel, to some degree, and realize that this is a painful process for all of us. A major area of concern for the Council, as the elected representatives of the community, is the adequacy of service levels in the wake of budget reductions. That was a prime concern of the staff as we went through this difficult exercise. In my opinion, after the reductions, even with the reality of true loss, the organization will continue to be a good organization, and our services to our citizens will continue at adequate or better levels. As we cure our financial problems and as the economy gains strength in the future, there may be opportunities for partial restoration of lost programs and personnel. As we have struggled for the past several months to identify prospective solutions to the City's fiscal problem, the words heard most often were "fair and equitable". In our analysis ' and recommendations, there were to be no "targets", nor any "sacred cows". There was to be "horizontal and vertical equity", meaning that the exercise had to be across all departments, and that upper level positions would be questioned as intensely as lower level . positions. These were the basic working principles on which the recommendations were based. Finally, our thought was that the fairness principle should extend to all the components of the four component equation, so that a "balanced package"be delivered to the City Council. In a situation where the municipal organization is spending more than it's taking in, the direct response of the City has to be to cut costs which means, at this point (following earlier cost- cutting efforts), cutting personnel, and the services those personnel provide. However, these service/personnel reductions can be moderated by three major factors: our desire/ability to raise revenues; our appropriate use of some portion of our accumulated reserves; and our ability - with the assistance of our employee associations - to reduce our labor costs. While we are facing a severe problem, and have made and must continue to make painful choices, there is no escaping the responsibility we have on behalf of our citizens. That responsibility is to face up to the facts of our present situation and, with the highest degree of responsibility and accountability, create a solvent City government, and thereby best ensure a strong future for our community. While a great deal of thought has gone into what is being presented to you, we are certain that listening to and incorporating the ideas of others will produce an even better approach to this difficult situation. As painful as this process is, it does give us the opportunity to ask some fundamental questions of ourselves and, in that process, to gain a clearer understanding of our basic mission and purposes. JD:mc h/revenue 11 I`IN^I�►►I�IIII�IIIII III MEETING DATE: II I► ���l city or san tins osispo 3-0f3 -9 COUNCIL AGENDA REPORT ITEM NUMBER: FROM: John Dunn, City Administrativecer SUBJECT: STRATEGIC BUDGET DIRE; N CAO RECOMMENDATION A. Provide strategic direction to staff on how to prepare the preliminary budget for public hearings starting in May. Consistent with the eight point budget strategy previously reviewed by the Council, it is .proposed that our strategy include the following components in closing a projected $33 million deficit for 1993-94: 1. Implement extensive expenditure/service cuts which will reduce regular staffing by 30 positions (11%). $ 2,189,800 2. Use fund balance (reserves), capital project cuts, and sale of property that will become surplus to partially fund construction of the Fire Station Headquarters and Performing Arts Center in order to reduce future annual debt service costs. 497,000 3. Increase revenues for 1993-94: a. Increase cable franchise tax rate from 4% to 5% 41,000 b. Increase recreation fees to achieve 50% overall cost recovery 1001000 C. Increase transient occupancy tax rate from 9% to 10% 260,000 d. Update public safety fees from 1983 levels 106,000 e. Implement reimbursement to the general fund from water and sewer funds for computer mapping (CADD) engineering services 52,200 f. Adopt proposed uniform building code fees in 1994 in accordance with existing City policy 54,000 4. Begin negotiations with employee associations to identify and agree upon ways of reducing labor costs that can reduce the impact of some service/staffing cuts. unknown B. Conceptually approve major City goals as developed at the February 6 and 9 budget workshops which will guide the staff in preparing the 1993-95 Financial Plan (final approval will not be made until adoption of the budget in June) and refer specific questions and ideas generated from the budget workshops to the Economic Strategy Task Force. ���N�►bHi�lill{IIIIIpjll�Ill city of San a-als OBISpo COUNCIL AGENDA REPORT C. Approve developing new resources to assure our long-term fiscal health. The following new revenue sources are also recommended. However, they are either restricted in their use for specific capital purposes, cannot be implemented until late in 1994-95 at the earliest, are contingent upon further legal developments, or require significant policy decisions that in some cases (such as paramedic fees) require actions by other government agencies. Because of this, they cannot be relied upon in balancing our budget for 1993-95. However, they will improve our long-term fiscal health, and as such, discretion to begin the steps necessary to fully study these options and prepare them for Council consideration at the earliest possible opportunity is recommended: 1. Allocate Community Development Block Grant revenues (which the City will begin receiving as an entitlement for the first time in 1994-95) for indirect cost recovery, economic stability activities, and homeless shelter operations. 2. Implement paramedic service charges. 3. Update park-in-lieu fees from 1984 levels. 4. Establish transportation and general facility development impact fees. 5. Improve cost recovery from special events. 6. Adopt local property transfer tax. OVERVIEW Purpose of this Budget Workshop The City is facing its toughest financial outlook in the post World War II era. To confront this challenge in a straight-forward and meaningful way, we have asked the Council and the staff to identify the steps necessary to ensure a balanced budget early in the Financial Plan preparation process. Under this approach, it is important to emphasize that the direction requested at this workshop is an early step - albeit a very important one - in the budget process: it is not budget adoption itself. This will not occur until June of 1993, after extensive Council consideration, community discussion, and public hearings. However, for the forthcoming process to be as meaningful and as productive as possible, it is important that we clearly set forth the fiscal problems facing us and what we can reasonably do about them at the earliest possible opportunity. This is the purpose of this workshop. "�'' ijj���►jil�hl City of San l .s OBISp0 COUNCIL AGENDA REPORT Summary of Recommended Strategic Budget Direction Stated simply, the recommended strategic budget direction uses the four remaining components of the eight point budget strategy in closing our projected budget deficit: ■ Cutting services and expenditures, which represent two-thirds of the recommended strategy. ■ Using fund balances - and other existing resources - to reduce future debt service costs for two key capital improvements: performing arts center and headquarter fire station. This component represents 15% of the recommended strategy. ■ Increasing some user fees and other revenues (including the transient occupancy tax), i which represents 19% (less than one fifth) of the deficit closing strategy. ■ Negotiating with our employees on ways to reduce labor costs in order to mitigate the impact of some service and staffing cuts. Until these negotiations are concluded, it is not possible to identify what share of the overall strategy this component will represent. In preparing the proposed stracegy for Council consideration, we have strived to present a i balanced program that "shares the pain" but also recognizes community priorities as well as opportunities to become more efficient. We recognize a great amount of information is presented in this workshop notebook. Although we have attempted to summarize key findings and issues in this report, the in- depth information compiled in this notebook has been prepared in order to provide the Council with the widest array possible of reasonable options in closing our budget gap. As a starting point in this difficult process, the CAO is presenting what he believes to be a reasonable mix of budget balancing strategies. As demonstrated by the depth of materials presented, there is a wide range of"doable"alternatives. Ultimately, it will be the Council's task to determine the final mix of strategies by adopting the Financial Plan in June of 1993. Council Approach to the Budget Process During our budget preparation and review period, the Council will have to make a policy decision between two basic roles it can play in this process: ■ The Council could decide to go through the budget line item by line item, and position by position, and make thousands of individual choices. ■ The Council could assume a policy-determining position, primarily examining the public service impacts and the revenue/expenditure direction All city city Of San JS OBISpO me COUNCIL AGENDA REPORT The CAO believes that the latter approach is essential as the only practical way to get us through a very difficult budget season, and more importantly, to assure that the larger perspective is kept in focus throughout the process. BACKGROUND The Crurerrt Situation ■ Over the last two years, a combination of the recession and State budget cuts has caused a financial crisis unprecedented in the City's history. Sales tax revenues for 1991-92 underscore these difficulties: compared with an original sales tax estimate of $6.8 million for 1991-92, actual sales tax revenues were only $5.85 million - the lowest level since 1986-87. In fact, until last quarter, we had experienced eight consecutive quarter declines in sales taxes - our most important revenue source. ■ Revenue reductions by the State over the last two years, which includes SB 2557, the shift of additional property taxes in 1992, and losses in cigarette tax and vehicle code fines, have further decreased City resources by over $1 million annually. i ■ The above factors, along with other lower than anticipated revenues to the General Fund, have resulted in a loss of$5.5 million annually,which represents over 25% of the City's General Fund operating budget. i What We Have Already Done In order to address these revenue losses, and to position ourselves for the tough decisions that lie ahead, the City Council has already taken a number of very difficult actions including: ■ Cutting budgets in mid 1991-92 by $1.7 million. ■ Reorganizing several departments to achieve a net reduction of nine positions, and cutting other City positions. ■ "Freezing" vacant positions, including Police Officer and Firefighter vacancies. ■ Eliminating $1.1 million in capital improvement projects in June of 1992, and agreeing in concept to fund our future capital program at 50% of past levels. ■ Further cutting operating budgets by over $1.4 million in November of 1992. ■ Deferring indefinitely a significant level of equipment replacements. "���i���►i►�IIIIIIIIIII1° IIS$ City of san suis oBispo COUNCIL AGENDA REPORT The Challenges Facing Us ■ As detailed in Section B of this report, the City has a projected General Fund deficit of$2.8 million, even without further State revenue cuts. Our five year forecast shows this to be an ongoing problem that cannot be addressed through "one time"methods. It is important to note that this forecast relies upon $1.0 million in operating expenditure cuts already made to the adopted 1992-93 budget, along with implementing strict cost controls in the future reducing our traditional level of capital improvements by 50%, and reducing equipment replacement contributions. ■ On top of this, we expect the State government - for the third year in a row - to take away a major amount of revenue from the City. Although it is not possible to project how much this might be - and we intend to aggressively resist any further State revenue cuts - we have assumed that cuts of $500,000 are likely based on past State actions. We realize that the actual level of State cuts could be greater than this, which would force the City into taking even more severe actions as outlined later in this report. ■ As responsible stewards of the public resources that have been entrusted to us, we must be committed to having a balanced budget by the beginning of next fiscal year, regardless of how difficult that might be. ■ Consequently, it is staff's responsibility to identify possible ways of closing this gap, including closing it entirely through budget cuts. It is a difficult but necessary exercise. ■ In addition to identifying options for solving the problem entirely through cuts, we have developed additional strategies in accordance with the eight point budget strategy previously reviewed by the Council. DISCUSSION What Is Our Financial Outlook for,7993-95? Revenue/Expenditure Gap An updated forecast similar to the one presented to the Council in November of 1992 is provided in Section B of this notebook. In addition to the results of the forecast, this section comprehensively outlines the key factors used in preparing the forecast. Although every component factor of the forecast has been reevaluated and analyzed, the results of the revised forecast are consistent with earlier projections, with two notable exceptions which increase the projected revenue/expenditure gap from $2.5 million to $2.8 million. Sales Tar Revenues. Based on last quarter's sales tax revenues, we have revised our forecast upward for this revenue source by approximately $300,000. S �i�H�1���►►�illlllilll�° 1111111 city Of San _JIS OBISpO COUNCIL AGENDA REPORT Liability and Workers'Compensation Insurance Unfortunately, our gains in sales tax revenue projections are offset by projected increases in workers' compensation and liability insurance. Last year, workers' compensation losses were up by 58%, and liability losses were up by 72%. The result of these losses are an estimated increase in contributions to the Central Coast Cities Joint Powers Authority (our vehicle for insurance coverage) of $600,000 annually - approximately $200,000 for liability and $400,000 for workers' compensation. A significant portion of this increase - $400,000 - is to cover our current unfunded liabilities of approximately $1.2 million. In accordance with adopted CCCJPA policies, this liability must be recovered within a three year period. The updated forecast reflects a corresponding reduction in operating costs starting in 1996-97. State Take-Aways Although we intend to strongly resist any further State budget cuts to cities, it is unrealistic to assume that there won't be some level of State take-aways. The Governor has already proposed cuts to cities that would take away about $1 million from the City of San Luis Obispo. Many believe that the Governor's budget is overly optimistic in a number of key areas, and that ultimately his recommended hits to cities might be even greater. Even though it is extremely difficult to predict, we believe assuming a minimum State take-away of $500,000 is a prudent course to take in setting our strategic budget direction, since it represents our experience over the last two fiscal years. Combined with the projected revenue/expenditure gap of $2.8 million, this means preparing a preliminary budget that must close a total gap of approximately $3.3 million. How Were the Budget Reduction Options and Recommendations Developed? Four of the cost-cutting strategies outlined in the CAO's "Eight Point Strategy" have been fully implemented this fiscal year: ■ Reducing General Fund contributions to the capital improvement program by 50%. ■ Reducing equipment replacement fund contributions. ■ Significantly reducing non-personnel operating costs. ■ Implement a pro-active legislative advocacy program, which we hope will eliminate (or at least mitigate) further State cuts in City revenues. These cost-cutting strategies were assumed in staffs financial forecast of last November, which nevertheless projected a substantial deficit in the coming years. Therefore, in order to develop balanced budgets for 1993-95, it has been necessary to engage in a very rigorous and difficult process of identifying numerous additional budget reduction options. This process has been called the "total cut solution", since the assignment to staff was to identify reductions in an amount which would fully resolve the projected deficit, if all cuts were implemented. The total projected deficit was $4 million, and consisted of two tiers: a $2.5 million projected revenue-expenditure gap, plus an additional $1.5 million in possible State take-aways. �����►��►nuIIVIIIIIfIIP�►u�uil�����ll MY Of San [Is OBISPO COUNCIL AGENDA REPORT It should be emphasized that it was never the intent of this process to recommend or implement all of the cuts at this level; however surfacing options at this level was felt to be necessary for three key reasons: ■ Provide an adequate array of service level choices to both the CAO and Council in building recommendations based on priority considerations, and not solely driven by the arbitrariness of across-the-board cuts. ■ Identify the impact it would have on service levels if the problem were solved totally through cuts, without bringing other strategies to bear on the solution. ■ Demonstrate the severe impact further State cuts could have, and to use this information in our legislative advocacy efforts. On January 4, 1993, the CAO issued instructions to department heads to prepare cuts for their departments consistent with established targets. Departmental target levels were set on a"fair share" basis, with each department asked to identify cuts amounting to about 18% of their respective operating budgets. Even though the enterprise funds are self-supporting through their own revenue sources, they were also included in this process, and their submittals are included in Section F of this notebook. Because the focus of this workshop is on the General Fund, opportunities for cost reduction in the enterprise funds (water, sewer, parking, transit, and golf) are not comprehensively addressed in this report. However,the options submitted by the enterprise operations will be closely analyzed as part of our overall budget review process, and will be reflected in the preliminary budget that we anticipate distributing to Council in May. In addition to a "fair share" allocation of the $4 million target level, the CAO established other guidelines in identifying the reduction options, including: ■ No sacred cows - everything is to be examined ■ No revenue offsets - must be expenditure reductions only ■ No speculative reductions - must be real and within City control ■ No delays - must be able to implement quickly ■ No contract employee savings (unless the contracts are due to expire beyond 1992- 93) ■ No deferred costs posed as savings-essential facilities,equipment, and infrastructure are to be maintained at responsible levels /-7 kcity of san Lacs ogispo mrAw COUNCIL AGENDA REPORT Between January 4 and February 11, all departments engaged in an intemal process for meeting their respective budget reduction targets. Details concerning the process used by each department are provided in Section F, and can be summarized as follows: ■ Where possible, departments first attempted to further reduce non-personnel related operating costs, including funds budgeted for temporary employees, before recommending reductions in regular staff positions. To illustrate this: the $4 million target was the equivalent of nearly 70 full-time equivalent (FTE) positions; actual staffing related options submitted by departments, however, totaled 52 FTE's, with non-personnel options composing the remainder of the $4 million. (The final CAO recommendation is to reduce regular staffing by 30 FTE's.) ■ Several departments used the "Mission Driven Service Levels" document to assist in distinguishing priorities, focusing to the extent reasonable on the "C" and "D" categories. ■ Department heads attempted to be "balanced" in their recommendations, seeking reductions at all levels in their operation. ■ Virtually every department used some form of participatory approach in developing their final recommendations, although the degree of complexity involved in these approaches varied with the size of the department. For example, in the small departments options were rather limited,and after some discussion, conclusions were reached fairly quickly. On the other hand, in larger departments like Police and Fire, more complicated processes were used. For example, in the Fire Department a Budget Review Committee was formed, a role playing exercise undertaken, and numerous discussions were held with fire crews and employee association representatives. The Police Department held an all day management brainstorming session, and meetings with employees and employee associations occurred on several occasions, resulting in various modifications. ■ Despite the highly participative nature of the departmental processes, the difficult decision of determining which options should ultimately be presented to the CAO fell to each individual department head. None of the decisions were easy,nor universally supported by all employees. Concurrent with the departmental processes, several other efforts were undertaken to receive input and to facilitate a clear understanding of the problem and the approach to developing recommended solutions. For example, a meeting was held with the Employee Working Group, special and regular Management Team meetings were frequently used to discuss the budget situation, and the CAO met on several other occasions individually with department heads. A Budget Review Team composed of the Assistant CAO, Finance Director, and Personnel Director - with staff support from the Administrative Analysts in Administration and the Revenue Manager and Accounting Manager in Finance - was formed to provide technical assistance and advice to the CAO. _ �����►b�i►�iIIIIIIIlI�p1B°�i�`IIII City Of San LuiS OBISPO = COUNCIL AGENDA REPORT It must be said, however, that even with diligent efforts to assure participation and full communication,the overall process has been inherently very difficult and painful. Some will feel that the level of participation and communication,and ultimately the recommendations, could have been handled in a better way. Undoubtedly, the process has not been perfect. However, given the limitations of time and the complexity and sensitivity of the issues, we can honestly say that a good faith effort was made to assure participation, collaboration, and communication at all levels. Still, very difficult decisions had to be made by department heads, and then by the CAO, to bring these recommendations forward to the City Council and to the community. It is not reasonable to expect that all parties will agree with these conclusions. What Are the Impacts of the Proposed Cuts? While staff is prepared to implement the recommendations in the most professional and resourceful manner possible, all of the City's department heads are very concerned about the impact these reductions will have on their ability to provide adequate service, maintain employee morale and productivity, and meet service expectations which do not decrease commensurately with staff reductions. These concerns deepen considerably for those options beyond those recommended by the CAO. Nonetheless, as discussed previously, the fiscal problems facing us require tough decisions. The specific impacts of these cuts are detailed in Section C of this workshop notebook. Although it is difficult to summarize the cumulative impact of over 90 specific cuts in 36 distinct program areas, the following is an overview of the proposed reductions: ■ The recommended staffing reductions will impact every General Fund operation except the City Attorney's Office, which only has 3 full-time employees. In terms of proportion, the administrative areas(Administration,Finance,Personnel, City Clerk) will be reduced to a greater extent than other departments. In the nine departments where personnel cuts are proposed, the lowest percentage cut is in the Police Department. ■ Based on early City Council guidance, staff has tried to be balanced in its recommendations, with a goal of minimizing the impact on services provided directly to the public. Consequently, management positions have been proportionately reduced to a greater extent than non-management positions. For example, management positions compose about 23% of the General Fund workforce,but 36% of the recommended staff reductions. These management positions recommended for reduction are in a broad range of departments, including Administration, Public Works, Community Development, Recreation, Finance, Police, and Fire. CityOfNn L"is OBISPO dii% OU CIL AGENDA REPORT ■ In addition to shaping a recommendation based on"balance", the staff has attempted to target reductions based on an assessment of City needs and preserving essential services, rather than using an across-the-board approach, which diminishes all services in the same way without regard to priorities. How Can We Most Effectively Use Our Strong Fund Balance Position? The City will end 1992-93 in a relatively strong financial position: ending unreserved fund balances are projected to be $6.7 million. This represents fund balances that are 32% of operating expenditures compared with our Financial Plan policy of 20%. This strong fiscal position did not happen by accident: it is the result of tough revenue and expenditure decisions by the Council,with the goal of maximizing our budget balancing options for 1993- 95. For example, all of the earlier cuts made by Council in 1992-93 directly contributed to the projected end of year balance. We believe the most effective use of these balances - combined with further capital project cuts and the effective use of surplus property - is to finance the construction of the headquarters fire station and performing arts center with pay-as-you-go- resources rather than debt financing as previously planned. As outlined in Section A of this notebook, this approach reduces future annual debt service costs by $497,000. This is accomplished in four basic ways: Use of fund balance $ 3,293,000 Further capital project cuts 779,200 Sale of surplus property 1,450,000 Project financing 1.677.800 TOTAL ESTIMATED PROJECT COSTS $ 7,200,000 By reducing the amount to be financed from $7.2 million to $1.7 million, future debt service payments are reduced from $648,000 to $151,000, an annual savings of $497,000. It should be noted that this pro forma is based on locating the headquarters fire station and recreation administrative facilities at the old Emerson School site. If this site is changed - which is currently under consideration - we may no longer want to build a recreation administration facility in conjunction with the headquarters fire station. However, since the construction cost of the recreation administrative facility and proceeds from the sale of the current recreation administrative facility site are estimated to be the same in this analysis, there is no net fiscal impact to this cost analysis if we make this change. Alternative financing approaches ■ Increase pay-as-you-go resources to further reduce debt service requirements. Reduce General Fund balances below our current 20% policy. If we were to use General Fund balances to make up the remaining amount necessary to /D �ii�d�l►x►i►mllillil��ii ►IIDJI city of San LuIS OBISpo COUNCIL AGENDA REPORT exclusively use pay-as-you-go resources ($1.7 million), General Fund balances would fall to 12% of operating expenditures. Further reduce equipment replacement fund balances. Defer other uncommitted capital projects such as the $600,000 allocated for open space acquisition. Redesignate the use of the proceeds from the 1990 debt financing ($900,000). Although initially designated for open space, these funds may be used for any legitimate, general purpose capital improvement. It should be noted that these funds must be committed by December of 1993, or the proceeds must be "defeased" (refunded to the bond holders). ■ Maximize our ability to borrow at lower rates than we can earn on our investments. We could debt finance these projects and invest the available pay-as-you-go resources in long term U.S. Treasury bonds. This could result in a net fiscal benefit to the City, since we should be able to invest at rates that yield greater returns than the interest on our debt financing by one to two percent (or $72,000 to $144,000 on a construction base of $7.2 million). We will further research the actual benefit we could expect from this approach and report back to Council. What Are Our Revmw Options? As identified in the Revenue Task Force report provided in Section D of this notebook, there are a wide range of revenue options available to the City. The Task Force identified 20 basic revenue options that the City could consider, and each of them is comprehensively reviewed in their report. At this time, we are recommending that the Council implement approximately $630,000 in new revenues effective in 1993-94 summarized as follows: ■ Increase cable franchise tax rate from 4% to 5% $ 41,000 ■ Increase recreation fees to achieve 50% overall cost recovery 100,000 ■ Increase transient occupancy tax rate from 9% to 10% 260,000 ■ Update public safety fees from 1983 levels 106,000 ■ Implement reimbursement to the General Fund from water and sewer funds for computer mapping (CADD) engineering services 521200 ■ Adopt proposed uniform building code fees in 1994 in accordance with City policy 54,000 The following new revenue sources are also recommended, but as discussed previously, the amount that could be generated during 1993-95 is highly speculative, and as such, they are not counted as part of our budget balancing strategy as this time: '►����►i►I�IIIIIIIIIP��°�1����II city Of San L"IS OBISPO i COUNCIL AGENDA REPORT ■ Allocating community development block grant (CDBG) revenues to the maximum extent possible for indirect cost recovery, economic stability activities, and homeless shelter operations. CDBG revenues - which should be available in 1994-95 - are estimated at $800,000 annually. The uses indicated above would use about $400,000 of this allocation. ■ Implementing paramedic service charges. As the Council is aware, there are a number of difficulties associated with finalizing the institutional relationships necessary to implement these fees. There are a wide range of alternatives available in costing and billing for these services. However, we believe it is reasonable to assume that we could recover about $200,000 annually from paramedic fees. ■ Updating park-in-lieu fees. The maximum amount that can be assessed per dwelling unit was capped in 1984. We recommend eliminating any limits on the fair market value of property in calculating park-in-lieu fees. ■ Improving special event cost recovery. A task force has been formed to present recommendations to Council, which is scheduled for later this fiscal year. ■ Establishing transportation and general facility development impact fees. Because of the depressed construction environment, these fees are unlikely to generate significant revenues during 1993-94. However, under a 1% growth rate, they could generate between $500,000 - $1,500,000 per year depending on the capital facilities included in the fees. Staff is close to finalizing a recommended transportation impact fee, and we anticipate bringing it to Council for approval in April. These fees will help to offset the 50% decrease in the General Fund contribution to the capital improvement program. ■ Adopting local property transfer tax. As discussed in the Revenue Task Force report, this could generate between $500,000 - $900,000 annually. This has been identified in the draft open space element as a key source of potential revenues to fund an expanded open space/parkland acquisition program. Reducing Labor Costs - What Can We do? How Much Could We Save? One of the key budget strategies recommended to the Council is to begin negotiations with our employee associations on ways we can reduce labor costs in order to at least partially mitigate regular staffing cuts. Now that potential cuts have been identified, staff can begin to creatively work with employees in doing this. As evidenced by the suggestions of the Employee Working Group - as well as a number of less formal employee discussions - there is a high level of employee interest in actively working on this aspect of our budget balancing plan. In beginning these discussions in earnest, it is important to note that the City cannot take (nor should it) unilateral actions in this area. Ultimately - with the exception of direct / ��►►►�i��►►IVilNlllll��p1I������I city of san Luis oBispo WiN COUNCIL AGENDA REPORT It layoffs or reduced hours - any labor cost savings must be based on mutual agreement with our employee associations. Because of this, it is not possible to identify specific cost savings associated with this component of our eight point budget strategy. Overview of our obligations to our employees If the City Council adopts a budget balancing strategy that includes eliminating some level of regular staffing, the City will be required by state law to negotiate with the various employee associations on the impacts of the lay-offs. Mandatory subjects of bargaining that will be discussed include (but are not limited to) salary freezes, work hour reductions, benefit reductions, retirement incentives, bumping rights, and severance packages. These are basically the concepts introduced to the Council in November of 1992 as part of the Employee Working Group recommendations, which are again presented for Council review in Section D (Task Force Reports) of this notebook. Since the City is unable to unilaterally impose labor cost cutting measures, will be relying upon the employees to participate voluntarily. The extent to which they are willing to preserve city employees targeted for lay-off is unknown, and as such, it is not possible to project definite dollar amounts that negotiations will yield. However, the savings and costs of some of the lay-off prevention measures suggested by the Employee Working Group and others have been estimated and are presented below as potential outcomes: Work how reductio,& These can come in a variety of configurations. For the purpose of this discussion, four basic models have been examined: ■ Closing City offices and non-public safety operations between Christmas and New Years would result in annual savings to the General Fund of approximately $120,000 (1.7% reduction in compensation for affected employees). ■ Closing those same operations the last Friday of each month would save approximately $320,000 (4% reduction in compensation for affected employees). ■ Converting these same operations to a four day work week of nine hours per day with closures every Friday would save $689,500 annually (10% reduction in compensation for affected employees). ■ On a case-;by-case basis, job sharing opportunities may be developed. It is not possible to estimate these savings. It should be noted that work hour reductions not only decrease salary levels, but overall service to the community. 161111Illlllll11 ���llll city of San ,_aIS OBISp0 0096 COUNCIL AGENDA REPORT Sakuy and benefit freeze& With this approach, a total annual savings of about $500,000 could be realized. This is based upon compensation increases that are already part of current agreements with the Firefighter and General Employee Associations as well as projected increases for those groups without negotiated agreements predicated upon the City's most recent settlement trends, which have been quite modest. Retirement incentive.& Two models of retirement incentives have been examined based upon employee interest. They are the PERS "Golden Handshake" program and the "PERS 2% at 55" retirement plan. "PERS 2% at 55" would cost the General Fund approximately $250,000 in 1994-95.This would continue as an ongoing benefit cost increase of 4%of salary until the year 2011. These cost increases would also apply to enterprise funds: all non-safety employees would be covered by such a plan. Our best review employee data indicates that there are 16 employees that are age 55 or over. Of that group, only 7 would have the requisite number of years to receive a 50% retirement benefit, which is the typical pension an employee is willing to accept. None of these 7 employees are currently targeted for lay- off, which indicates that they are in positions that the CAO believes should be retained, and thus refilled should they become vacant. The "Golden Handshake" program offers employees two years of additional service credit if they retire and the City does not refill the position vacated. The cost of this benefit is estimated at $16,000 per employee who would participate, or approximately 4 to 6 months salary depending upon the employee's age and years of service. Summary of labor cost saving options As noted above, these do not represent an exhaustive list of the possibilities, but with further Council direction in preparing for layoff impact bargaining, additional alternatives may emerge. In developing mitigation measures, staff will try to reflect the City's traditional commitment to fair and compassionate treatment of all of our employees. However, we must also realize the fundamental nature of our task is to reduce costs, and this cannot be accomplished without affecting some of our employees. CONTINGENCY PLAN Wfwt do we have to do if there are further State take-aways or we don't achieve recommended components of the proposed strategic budget direction? The materials presented in this notebook have been specifically prepared to provide Council with a broad array of specific options that fall into four basic categories: ■ Further service/staffing cuts as presented in Section F of this notebook ■ Further labor cost savings ■ Further revenue increases as presented in Section D of this notebook Greater user fee cost recovery Assessment districts _/ 11"Qh1111J$JJ1�111111 II city of San LuiS OBISp0 COUNCIL AGENDA REPORT Expanded tax base Other revenue increases ■ Further use of fund balance (reserves) TASK FORCE REPORTS To present the Council with a range of management options in addressing our fiscal problems, the CAO formed the following task forces. Their findings and recommendations are provided in Section D of this notebook: Tax Override for Public Safety Task Force Formed to determine what is necessary for a voter - approved tax override for public safety (police and fire) purposes. Members included Jim Gardiner (Chair, Police Chief), Erwin Willis (Fire Battalion Chief), Wendy George (Personnel Analyst), and Cindy Clemens (Assistant City Attorney). Federal - State Grants Task Force Formed to determine the opportunities for state and federal grants to improve our fiscal condition. Members included Deb Hossli (Chair, Administrative Analyst), Terry Sanville (Transportation Planner), Linda Asprion (Revenue Manager), and Jeff Zimmerman (Fire Engineer). Prevailvrg Wage Task Force Formed to determine if we can save money on construction projects if we delete our prevailing wage rate requirements. Members included Wayne Peterson (Chair, City Engineer), John Moss (Acting Utilities Director), Jeff Jorgensen (City Attorney), and Ann Slate (Personnel Director). Employee Working Group Formed to identify ways of mitigating employee layoffs through labor cost reductions. Members included association presidents and department fiscal officers. Revenue Task Force Formed to identify and evaluate possible new revenue sources. Members included Bill Statler (Chair, Director of Finance), Kathy Koop (Principal Recreation Supervisor), Sue Baasch (Utilities Administrative Analyst), Dave Elliott (Public Works Administrative Analyst), Linda Asprion (Revenue Manager), and Carolyn Dominguez (Accounting Manager). The results of one other Task Force formed as part of the budget process - the Mission Driven Service Levels Task Force - were presented to Council at the January 26, 1993 budget workshop. - S 21111�� city of San a-aiS OBISPO IN almom COUNCIL AGENDA REPORT COUNCIL GOALS FOR 1993-95 Based on the outcome of the February 6 and 9 budget workshops, draft goals are provided in Section A of this notebook for conceptual approval by the Council. Although final adoption of these goals will occur in June with approval of the 1993-95 Financial Plan, conceptual approval of these goals at this time will assist the staff in preparing the Preliminary Budget. The goals are organized into four sections: ■ Guiding principles for preparing the budget ■ Major City goals ■ Program objective options ■ Referrals to the Economic Strategy Task Force of questions and ideas generated by Council at the budget workshops SUPPORTING MATERIALS The following is an overview of the supporting materials provided in Section A through F of the workshop notebooks: Section A Key Summaries and Recommendations ■ Overview of recommended strategic budget direction ■ Summary of proposed expenditure/staffing reductions ■ Listing of proposed regular position reductions and their status ■ Strategic use of fund balances - pay-as-you-go financing alternatives ■ Summary of revenue,options ■ Five year financial forecast summary ■ Eight point budget strategy ■ 1993-95 Council Goal-Setting - Guiding principles - Major City goals - Program objective options - Referrals to the Economic Strategy Task Force Section B Updated Five Year Financial Forecast ■ Overview ■ Summary of historical trends ■ Outline of major assumptions ■ Forecast summary based on "mid-range" revenue projections ■ Key forecast factors / / ��������NiVIIIiIIIIIlip1 �Il�Ill City Or San L,.AIS OBISpO COUNCIL AGENDA REPORT Section C Recommended Expenditure/Service Cuts ■ Summary of expenditure/staffing reductions ■ Summaries of regular position reductions and their status ■ Detail listing of cuts by department and their service impact on the community and organization Section D Task Force Reports ■ Tax override for public safety ■ Grants ■ Prevailing wage ■ Employee Working Group ■ Revenues Section E Background Materials ■ Memorandum from the CAO dated November 5, 1992 regarding the status of the Performing Arts Center ■ Memorandum from the CAO dated January 22, 1993 regarding budget season impacts on City employees and the City Council's role ■ Total cut solution guidelines and direction to staff Section F Total Cut Solution Options ■ Summary of "total cut solution" options submitted to the CAO by the operating departments ■ Detail of "total cut solution" options by departments and their impacts on the community and organization. Includes cover memorandum transmittals from department heads describing the process they used in preparing these options. SUMMARY There will be additional opportunities over the next three months for further input from both employees and the community to refine the recommendations now before the City Council. As noted in the overview section of this report, the Council's strategic budget direction to staff represents the beginning - not the end - of our budget process for 1993-95. 1-17 Section A KEY SUMMARIES AND RECOMMENDATIONS IsThis section includes key summaries, tables, and recommendations. Contents ■ Overview of recommended strategic budget direction 1 ■ Summary of proposed expenditure/Staffing reductions 2 ■ Listing of proposed regular position reductions and their status 3 ■ Strategic use of fund balances - pay-as-you-go financing alternatives 4 ■ Summary of revenue options 5 ■ Five year financial forecast summary 6 ■ Eight point budget strategy 7 ■ 1993-95 Council Goal-Setting 8 - Guiding principles - Major City goals - Program objective options - Referrals to the Economic Strategy Task Force RECOMMENDED SThATEGIC BUDGET DIRECTIG-d4 FISCAL PROBLEM Revenue/Expenditure Gap 2,800,000 Projected at basically the same as the five year forecast presented to Council on November 10, 1992 except sales tax revenues are projected to be better by$300,000 while insurance expenditures (workers compensation/liability)are projected to be$600,000 higher. State Takeways Projected to be at least$500,000,based on the experience of the last two years.State cuts above 500,000 $500,000 take us into the contingency plan. TOTAL 3:.. 00000.: Forecast assumptions continue to include reducing equipment replacement by2595 and CIPprojects by509v. RECOMMENDATIONS r Implement expenditure/service cuts — reduces regular staffing by 30 positions(11%v). 2,189,800 r Use fund balance(reserves),capital project cuts,and sale of property to partially fund construction of the Fire Station Headquarters and Performing Arts Center in order to reduce future debt service costs. 497,000 W Increase revenues: 1993-94 — Increase cable franchise tax rate from 49c to 5 9c 41,000 — Increase recreation fees to achieve 5070 overall cost recovery 100,000 — Increase transient occupancy tax rate from 99c,to 1095 260,000 — Update public safety fees from 198.7 levels 106,000 — Implement reimbursement to the General Fundfrom Water andSewer Funds for computer mapping(CARD)engineering services 52,200 Adopt proposed Uniform Building Code fees in 1994 in accordance with Citypolicy 54,000 The following new revenue sources are also recommended However,they are either restricted in their use for specific capital purposes,cannot be implemented until late in 1994-95 at the earliest,are contingent upon further legal developments,or require significant poilcy decisions that in some cases(such as paramedic fees)require actions by other government agencies. Because of this,they cannot be relied upon in balancing our budget for 1993-95. However, they will improve our long term fiscal health,and as such,policy approval to begin the steps necessary to implement them at the earliest possible opportunity is recommended at this time: — Allocate CDBGrevenues forindirect costs,economic sta bility,and homeless shelter — Implement paramedic service charges — Update park in—lieu fees from 1984 levels — Improve special event cost recovery — Fstabh'sh transportation andgeneral facility development impact fees — Adopt local property transfer tax W Begin negotiations with employee associations to identify and agree upon ways of reducing labor costs that can reduce the impact of service/staffing cuts. unknown TOTAL . 3 00'000. CONTINGENCY PLANS What we must do if there are further state takeaways or we do not achieve recommended components. a- Further service/staffing cuts as presented in this report r Further labor cost savings w Further revenue increases ' — Greater user fee cost recovery Assesment districts Expanded tax base — Other revenue increases r Further use of fund balance(reserves) 1 GENERALFUND - Summary of Proposed Budget/Regular Staffing Reductions Current Resources 1 Recommended Cuts Regular Budget Re lar Staffin Budget Staffiyj Amt Cut %Cut No.Cut %Cut City Council 133,900 16,200 12.1% Administration 492,900 6.0 99,000 20.1% 15 25.0% City Attorney 238,500 3.0 0 0.0% 0.0 0.0% City Clerk 332,200 6.0 53,800 162% 1.0 16.7% Personnel 487,600 6.0 95,.400 195% 1.5 25.0% Finance 978,600 17.0 133,100 13.6% 3.0 17.6% Insurance&Non-Depart'l 964,900 Community Development(3) 1,456,600 223 172,100 11.8% 25 112% Recreation 1,284,200 13.0 105,800 8.2% 2.0 15.4% Public Works(4) 4,887,800 645 553,600 113% 6.5 10.1% Utiltities(5) 58,600 Police (6) 5,671,200 84.0 504,600 8.9% 6.0 7.1% Fire 4,071,700 545 375,600 9.2% 6.0 11.0% Special Programs - Human relations grants 86,900 9,000 10.4% - Cultural activity grants 83,800 8,700 10.4% - Community promotion 231,200 24,000 10.4% - Homeless shelter(2) 120,000 0 0.0% - Economic stability 139,0001 39,0001 28.1% 1 1 Total General Fund 1 27631 2,189,80011 10.1% 30.0 10.9% 11 Notes: 1. Based on the adopted budget for 1992-93 as reduced by Council (on an annualized basis)on November 10, 1992. 2. Reflects full funding for 1993-94;proposed to be deleted from General Fund effective 1994-95. 3. Includes Open Space Planner position scheduled for deletion effective 1993-94. 4. Includes Transportation Manager as well as Engineering Assistant position scheduled for deletion effective 1993-94. 5. Includes overfill Police Lieutenant position. 6. This reflects the solid waste management program,which is tasked with preparing state-mandated recycling and source reduction programs.Accordingly, no reductions are proposed for this relatively small General Fund activity. 7. Excludes all activities and regular positions funded through special,enterprise and agency funds: Current Resources 1 Regular Budget Staffin BIA 169,300 0.0 Water 3,721„500 21.3 Sewer 2,232,900 25.2 Parking 619,600 6.0 Transit 749,600 1.0 Golf 272„300 3.0 Whale Rock 615,600 35 Total Other Funds 8380,800 60.0 Total General Fund 21719 600 2763 TOTAL - ALL.FUNDS 1 30100 400 3363 . 2 GENERAL FUND - Proposed Regular Staffing Reductions ADMINISTRATION Administrative Analyst Filled IF Administrative Secretary Filled 03 Total Administration 1.5 CITY ATTORNEY I Total City Attorney 0.0 CITY CLERK Office Assistant Filled 1.0 Total Citv Clerk 1.0 PERSONNEL Health Work Coordinator Filled 1.0 Personnel Assistant Filled OS Total Personnel 1.5 FINANCE Accounting Assistant Filled 2.0 Customer Services Supervisor Filled 1.0 Total Finance 3.0 COMMUNITY Plan Check Engineer Vacant 0.7 DEVELOPMENT Office Assistant Filled 0.3 Associate Planner Filled 1.0 Total Community Development 2.0 RECREATION Recreation Coordinator Filled 1.0 Recreation Supervisor Filled 1.0 Total Recreation 2.0 PUBLIC WORKS Maintenance Worker Vacant 1.0 Heavy.Equipment Operator Filled 1.0 Transportation Manager Vacant 1.0 Parks&Buildings Manager Filled 1.0 Streets Project Coordinator Filled 1.0 Supervising Civil Engineer Filled 1.0 Secretary Frilled OS Total Public Works 6.5 POLICE Records Clerk Vacant 1.0 Crime Prevention Coordinator Filled 1.0 Communications Technician Filled 1.0 Police Lieutenant Filled 1.0 Police Sergeant Filled 1.0 Police Officer Vacant 1.0 Total Police 6.0 FIRE Graphics Technician(transfer to Comm Dev) Vacant 1.0 Fire Education Specialist Filled 0.5 Battalion Chief Filled 1.0 Fire Prevention staff Filled 1.0 Firefighter/Engineer* Vacant 3.0 Total Fire 6.5 ' •Because of the 24 hour per day nature of the fire service,this actually represents a decreased staring level of only 1 position at any one time,and will not lower existing minimum staffing levels. TOTAL Note:Additional vacancies due to pending retirements and natural attrition are anticipated by the beginning of 1993-94. 3 USE OF RESERVES: ray—As—You—Go Financing Alternatives No.- Headquarters Fire Station/Recreation Administrative Facility(see note 3) *. I Performing Arts Center . It has been our longstanding plan —in accordance with adopted Flanncial Plan policies regarding capital financing and debt management — to debt finance these two major projects. Based on our current financial situation,however,it is recommended that we make a strategic use of our fund balances to pay for these projects with current resources, which will reduce our future year operating costs by reducing debt service payments. Pay—As —You Go Resources Available fund balance at June 30, 1993 • Projected unreserved fund balance 6,725,900 • Designated at 20%of operating expenditures (4,232,40 • Net fund balance available 1 2,493,5 00 Capital project cuts based on potential deferrals presented to Council on 6-30-92 • Fire heavy rescue trailer 15,000 • Fire training facility(grant funding to be pursued) 160,000 • Street reconstruction(1992-93 uncommitted balance remaining) 427,800 • Traffic signal upgrades(grant funding to be pursued) 100,000 • Johnson park irrigation project 49,000 • Public art 27.400 • Total capital project cuts 779,200 Reduction in equipment replacement fund balances(1) 800,000 Sale of current Recreation Adminstration site upon project completion(2) 650,000 Sale of current Headquarters Fire Station site (Garden/Pismo)upon project completion (2) 800 000 TOTAL PAY—AS—YOU—GO RESOURCES 5,5 22700 Facility Costs Headquarters Fire Station/Recreation Administrative Facility(3) 3,000,000 Performing Arts Center 4,200,000 TOTAL FACILITY COSTS .:.1,200`000: Balance to be financed by other sources 1677 00 ANNUAL SAVINGS WITH THIS APPROACH Projected annual debt service for these projects in the five year financial forecast 648,000 Debt service on balance to be financed 151,000 Annual Savings 497 000 ALTERNATIVES Increase pay—as—you—go resources to further reduce debt service requirements w Reduce General Fund balances below our currrent 20%u policy. r Further reduce equipment replacement fund balances. mip- Defer other uncommitted capital projects such as the$600,000 allocated for open space acquisition. r Redesignate the use of the proceeds from the 1990 debt financing($900,000). Although initially designated for open space,these funds may be used for any legitimate,general purpose capital improvement. IMPORTANT NOTE: These funds must be committed by December of 1993,or the proceeds must be "defeased"(refunded to the bond holders). Maximize our ability to borrow at lower rates than,we can earn on our investments w- We could debt finance these projects and invest the available pay—as—you—go resources in longterm U.S. Treasury bonds. This could result in a net fiscal benefit to the City,since we should be able to invest at rates that yield 1%-2%greater returns than the interest on the bonds.We will further research the actual benefit we could expect from this approach and report back to Council. NOTES . 1. Reduces fund balance from 30%of replacement costs(per Council adopted policy)to 20%.leaving a balance of$1247,000 at 6-30-93. 1 'These estimates are not based on a detailed analysis—sale of both properties could be made to the Parking Fund. 3. This analysis assumes colocating.the fire station and the recreation admin facility. If the construction site is changed as currently under consideration,we may no longer wish to do so.Since the construction cost and estimated revenues from sale of the current site are the same in this analysis.there is no net fiscal impact to this cost analysis if we make this change. 4 SUMMARY OF REVENUE TASK FORCE FINDINGS The Revenue Task Force reviewed 20 possible revenue sources organized into four basic categories: W Taxes W Operating Program Fees W Development Impact fees W Entrepreneurial Opportunities Potential annual revenues from these sources total over $8 million summarized as follows: Potential New Revenue Sources Annual Revenues First Year Fifth Year Taxes Property transfer tax - set our own rate at$4.40/$1,000 525,000 900,000 Transient occupancy tax - increase rate from 9% to 10% 260,000 260,000 Utility users tax Expand base to sewer and trash 300,000 300,000 Increase rate from 5% to 6% 540,000 540,000 Business tax - increase rate from $50/$100,000 to $60/$100,000 140,000 140,000 Admissions tax - set rate at 6% of admission price 150,000 Franchise tax Expand base to include sewer @ 2% (current water rate) 81,700 81,700 Increase cable rate to 5% 41,000 41,000 Operating Program Fees Police services 30,000 30,000 Fire services Paramedic cost recovery 325,000 Code enforcement services 50,000 50,000 Development review 36,000 36,000 Business inspections 125,000 125,000 Special events 88,000 88,000 Benefit assessments for landscape & lighting 2,100,000 Mello-Roos special taxes varies Recreation activities 100,000 350,000 Capital Improvement Revenues Park in-lieu fees - remove current limit unknown unknown Transportation impact fees - set new fee 100,000 500,000 General facility impact fee - set new fee 100,000 500,000 Local option sales tax - Countywide voter approval @ 1/2 cent 1,600,000 Entrepreneurial Opportunities Annexation of CMC/Cal Poly 600,000 Property management unknown ' Private/public partnerships unknown TOTAL 29516,700 8,716,700 5 00 0000000 000 000 0000 0000 0 00 000 CD 0 O O O O CD O O CD Q C) p O CD 0 CD CD m N rl- 00 M 00 Itr \0 CO 00 IV C*4 -14, r4 rz .ZF C;it.:CP7 rz rrz•-Z 06 vi W� CD \0 M kn 00 m r- 0\ 0% MD W) C-4 RCD Q\ 00 'r (7% 0% NOON c 00 rl�%C�er: t- t, Rt N m ri C4 N .12 .06 Cl CD CD 0 4= 40 4= 4= = N m CD r- 00 �cern V CL Wl a, b 0� CDP% C;146 kf.;kf�el:, CIT\C;C; Ch C%en- o'\ ?9 90,09 4 v 'D lqr 00 4t N 0 = 0 CD CD CD 9 C) 0 M 0 CD C) 4� CD C) CD CD C) C) CD CD = CD CD 0 00 CD M. 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Et 0' 0 0 O. w x W :4U :4 00 120 S OF290 :0) 6 December 16, 1992 MEMORANDUM tcm: City Council, Management Team, Interested Others John Dunn Subject: Eight Point Strategy For Dealing With The City's Revenue- Expenditure Gap This outline was produced to assist me to discuss these matters with you. I look forward to that. * 1. Reduce services/reduce personnel * 2. Reduce labor costs (Employee Working Group recommendations) such as: Salary decreases Reduced work week Unpaid time off Early retirement incentives Scheduled increase rollback Other 3 . Implement other potential cost savings such as: Reduce HRC-PCC grants Review use of private sector contracts Use citizen volunteers (to provide services) Conduct expert study of Public Safety functions * Reexamine need for current services 4. Increase revenues such as: Departmental recommendations * Revenue Task Force recommendations Vertex cost of services study implementation Assessment districts (street lighting, sweeping, and landscaping) * Increase Federal-State grants (staff committee) * Property tax override for public safety, other Economic development (long term) Other revenue increase ideas 5. Use specified portion of reserve (fund balances) 6. Reduce capital improvement program (already assumed) 7. Reduce Equipment Replacement Fund contributions (already assumed) 8. Work with our State legislators (objective: eliminate further State cuts in City revenue) Discussion: To the degree that we successfully achieve points 2 through 8, we reduce the pain in No. 1. better identify "what does the City do and why do we do it" the staff is sently working on a Service Levels Analysis. * Special staff work is progressing in these areas. h/strategy 7 1993-1995 GOAL SETTING .....................I rl�clp...................... ■ Be open to change and new ideas. ■ Balance budget while maintaining most critical basic services and minimizing "overhead"and other administrative costs (emphasize change in how we do things, not in what we do). ■ Find solutions to the City's financial challenges which maintain and promote a quality community and preserve our tradition of support for social service programs. ■ Have a "continuous improvement" attitude in delivering City services, including those which are mandatory, to assure the most cost effective services possible. ■ Continue to build partnerships with other levels of government, particularly Cal Poly, Cuesta College, the County of San Luis Obispo, and the California Men's Colony. ■ Continue strong community involvement efforts, including: citizen participation through diverse task force memberships, community forums for key issues; and enhanced use of community-based resources and volunteers. ■ Assure the public safety and preservation of neighborhood quality within the community by supporting diverse City services which prevent crime, assist neighborhood health and safety, and support our youth (e.g., Police and Fire services, youth programs and childcare, neighborhood preservation, code and zoning enforcement). mgmay.-GO-W ........................I... ■ Maintain City fiscal health and a balanced budget. ■ Implement a more defined/proactive Economic Stability Program. ■ Continue to aggressively pursue the development of a long range water supply, including the Nacimiento project, Salinas Dam expansion, use of reclaimed water, and the evaluation of a pipeline between the Salinas Dam and Whale Rock Reservoir. ■ Complete the update of General Plan Elements: ► Land Use Element ► Circulation Bement 8 Page 2 1993-95 Goal Setting ► Housing Element (including student housing) ► Open Space Element ► Noise Element ■ Adopt master calendar for completing the updating of General Plan Elements. Following completion of the update, develop a program to assure that General Plan elements are routinely reviewed and kept current. ■ After adoption of the updated General Plan Elements, prepare options for the implementation of an enhanced neighborhood protection program, based on citizen input. ■ Develop non-general fund options to support the implementation of Open Space Programs. ■ Adopt a Downtown Physical Concept Plan which promotes appropriate mixed uses in the downtown. ■ Work with the community and pursue grant funding to promote installing more trees and landscaping in various areas of the community. ■ Adopt a creek setback ordinance. ■ Adopt an agricultural zone for the City. ■ Streamline the development review process, while assuring high standards and quality projects. ■ Implement programs to achieve solid waste reduction goals established under AB 939. ■ Enhance the use of alternative transportation through the implementation of projects identified in the Circulation Element, Short Range Transit Plan, and Bicycle Plan, and pursue grant funding in support of specific projects, including rail. ■ Construct the Performing Arts Center in conjunction with Cal Poly and the • Foundation for the Performing Arts. ■ Evaluate pre-hospital emergency medical care and transport services to eliminate duplication of service, and develop an equitable formula for paramedic service cost recovery and/or consider a City operated patient transport system. 9 Page 3 1993-95 Goal Setting ............................................................................ Progi a�t#'Q�jiyirtiy�' ■ Implement new cable TV agreement (Administration). ■ Explore potential for consolidating City newsletter with other existing newsletters, such as the BIA, Chamber of Commerce, and Recreation Department newsletters (Administration). ■ Continue review of City property to determine if surplus property is available for affordable housing purposes (Administration). ■ Aggressively resist unfunded State mandates (Administration/Finance). ■ Collaborate with private non-profit groups and other levels of government to improve youth services (Administration, Police, Recreation). ■ Maintain legislative advocacy efforts on the highest priority issues (Administration). ■ Concentrate efforts on getting more grant funding, and using CDBG funds for social services currently funded through the General Fund (e.g. HRC grants, Homeless Shelter). (Administration, Finance, others). ■ Complete Mission Plaza expansion (City Attorney, Public Works). ■ Assure full compliance with disclosure requirements for contractors, consultants, and lobbyists (City Clerk). ■ Complete a needs assessment for implementing a computerized records system/community information access in the City Clerk's Office (City Clerk, Finance). ■ Plan additional community recreation and open space areas, per the Open Space and Community Recreation Plans (Community Development, Recreation). ■ Seek County adoption of City Land Use Element proposals within the urban reserve line (Community Development). ■ Consider, consistent with established schedules, annexations within the Urban Reserve Line, including the Airport Area, to assure City control of land uses and . additional revenue (Community Development). 10 Page 4 1993-95 Goal Setting ■ Implement policies which discourage the conversion of residential to office uses (Community Development). ■ Continue efforts to preserve hillside and creek areas (Community Development). ■ Develop and implement joint purchasing efforts with other agencies (Finance). ■ Increase cost recovery for "non-essential' services (Finance, others). ■ Generate higher cost recovery for appropriate existing recreation programs (Finance, Recreation). ■ Complete construction of Headquarter Fire Station Facility (Fire). ■ Implement and evaluate the Student Neighborhood Assistance Program (SNAP), including the potential for expanding its use throughout the City (Police). ■ Complete the analysis of the Southern Pacific Railroad Bikepath Project and identify non-General Fund funding for the project (Public Works). ■ Evaluate existing trolley program to determine if there are ways of enhancing its effectiveness as a transportation service (Public Works). The items below were designated a lowerpriority. to be considered only as resources and workload permit: ■ Consider the use of an appropriately qualified organizational analyst to study specified departmental operations, depending upon need (as determined by Council) and funding availability (Administration). ■ Fully implement a geographic information system (GIS) (Community Development, Public Works, Finance). ■ Establish regular review schedule for City Council advisory bodies (City Clerk). ■ Prepare a "digest version" of the General Plan Elements (Community ' Development). kh\goalset i i (PLEASE INSERT IN SECTIr 4, PAGE 12) MEFTING AGENDA D, ITEM #�� REFERRALS TO THE ECONOMIC STRATEGY TASK FORCE During the City Council Goal Setting Workshops of February 6th and 9th, individual Councilmembers offered several ideas for consideration by the Economic Strategy Task Force. These ideas, which are outlined below, will be formally considered and referred by the City Council during the budget workshop on March 13th. ■ Consider ways to enhance tourism by promoting and protecting the City's natural resources and cultural heritage. ■ Recommend programs and incentives that retain/expand existing businesses and attract "desirable/targeted" new businesses. ■ Consider ways to improve the opportunity for local businesses to obtain contracts in the local market. ■ Consider the role the public and private sectors can play in ensuring fair commercial lease rates. ■ Evaluate what the City's population base can reasonably support in the way of commercial development. ■ Consider the impact "mega-stores" have on smaller locally owned businesses. ■ Determine the kind of businesses the City should attempt to attract and retain so that revenue generated is "new dollars". ■ Consider how the community can develop in a way that meets the needs of the present while also providing long-term enhancement. ■ Identify incentives that will assist in new small business start-up, including the possibility of business tax and home occupation permit fee waivers for "hardship" cases (similar to the City's Utilities Assistance Program). ■ Streamline the City's development review process, consistent with achieving the City's quality standards and preserving procedural safeguards. ■ Consider the role of special events in supporting the City's economy, including the establishment of another Poly Royal-like event. ■ Consider the role the Performing Arts Center at Cal Poly can play in supporting the City's tourist economy. 12 C ! 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Contents Summaries 0 Overview of proposed budget/regular staffing reductions 1 ® Listing of proposed regular staffing reductions 2 M Vacant position summary 3 Proposed regular staffing reductions by department and position type 4 Expenditure/Service Reduction Impacts by Department e City Council 5 Administration 6 O City Attorney g ■ City Clerk q ■ Personnel 10 ®. Finance 11 0 Community Development 13 e Recreation 15 M Public Works 16 ■ Police 21 ■ Fire 23 GENERAL FUND Summary of Proposed Budget/Regular Staffing Reductions ItCurrent Resources 1 Recommended Cuts Regular Bud et Re lar Staffm Budget Staffing Amt Cut %Cut No.Cut % Cut City Council 133,900 16,200 12.1% Administration 492,900 6.0 99,000 20.1% 1.5 25.0% City Attorney 238,500 3.0 0 0.0% 0.0 0.0% City Clerk 332,200 6.0 53,800 162% 1.0 16.7% Personnel 487,600 6.0 95,300 19.5% 1.5 25.0% Finance 978,600 17.0 133,100 13.6% 3.0 17.6% Insurance& Non-Depart'I 964,900 Community Development(3) 1,456,600 223 172,100 11.8% 2.5 112% Recreation 1,284,200 13.0 105,800 8.2% 2.0 15.4% Public Works(4) 4,887,800 64.5 553,600 113% 6.5 10.1% Utiltities (5) 58,600 Police (6) 5,671,200 84.0 504,600 8.9% 6.0 7.1% Fire 4,071,700 54.5 375,600 92%u 6.0 11.0% Special Programs - Human relations grants 86,900 9,000 10.4% - Cultural activity grants 83,800 8,700 10.4% - Community promotion 231,200 24,000 10.4% - Homeless shelter(2) 120,000 0 0.0% - Economic stability 139,0001 39,0001 28.1% Total General Fund(7) 21719 600 ..2763 11 2 189"800 10.1% 1 30.�Q 10.9% Notes: 1. Based on the adopted budget for 1992-93 as reduced by Council(on an annualized basis)on November 10,1992. 2. Reflects full funding for 1993-94;proposed to be deleted from General Fund effective 1994-95.. 3. Includes Open Space Planner position scheduled for deletion effective 1993-94. 4. Includes Transportation Manager as well as Engineering Assistant position scheduled for deletion effective 1993-94. 5. Includes overfill Police Lieutenant position. 6. This reflects the solid waste management program,which is tasked with preparing state-mandated recycling and source reduction programs.Accordingly,no reductions are proposed for this relatively small General Fund activity. 7. Excludes all activities and regular positions funded through special,enterprise and agency funds: Current Resources 1 Regular Budget Staffin BIA 169,300 0.0 Water 3,721,500 21.3 Sewer 2,232,900 252 Parking 619,600 6.0 Transit 749,600 1.0 Golf 272,300 3.0 Whale Rock 615,600 33 Total Other Funds 1 8,480,800 60.0 Total General Fund 21,719,6001 2763 TOTAL- ALL FUNDS 30100 400 1 3363 1 GENERAL FUND Proposed Regular Staffing Reductions .:Status ::. No ADMINISTRATION Administrative Analyst Filled 1.0 Administrative Secretary Filled 0.5 Total Administration 1.5 CITY ATTORNEY Total City Attorney 0.0 CITY CLERK Office Assistant Filled 1.0 Total Citv Clerk 1.0 PERSONNEL Health Work Coordinator Filled 1.0 Personnel Assistant Filled OS Total Personnel 1.5 FINANCE Accounting Assistant Filled 2.0 Customer Services Supervisor Filled 1.0 Total Finance 3.0 COMMUNITY Plan Check Engineer Vacant 0.7 DEVELOPMENT Office Assistant Filled 0.3 Associate Planner Filled 1.0 Total Community Development 2.0 RECREATION Recreation Coordinator Filled 1.0 Recreation Supervisor Filled 1.0 Total Recreation 2.0 PUBLIC WORKS Maintenance Worker Vacant 1.0 Heavy Equipment Operator Filled 1.0 Transportation Manager Vacant 1.0 Parks&Buildings Manager Filled 1.0 Streets Project Coordinator Filled 1.0 Supervising Civil Engineer Filled 1.0 Secretary Filled OS Total Public Works 6S POLICE Records Clerk Vacant 1.0 Crime Prevention Coordinator Filled 1.0 Communications Technician Filled 1.0 Police Lieutenant Filled 1.0 Police Sergeant Filled 1.0 Police Officer Vacant 1.0 Total Police 6.0 FIRE Graphics Technician(transfer to Comm Dev) Vacant 1.0 Fire Education Specialist Filled 0.5 Battalion Chief Filled 1.0 Fire Prevention staff Filled 1.0 Firefi ter/En 'neer• Vacant 3.0 Total Fire 1 6-5 'Because of the 24 hour per day nature of the fire service,this actually represents a decreased . staffing level of only 1 position at any one time,and will not lower existing minimum staffing levels. TOTAL 30:p Note:Additional vacancies due to pending retirements and natural attrition are anticipated by the beginning of 1993-94. 2 VACANT POSITION SbMMARY Summary By Department - All Funds Authorized Filled Vacant % Vacant Administration 6.0 6.0 0.0 0.0% City Attorney 3.0 3.0 0.0 0.0% City Clerk 6.0 6.0 0.0 0.0% Personnel 6.0 6.0 0.0 0.0% Finance 17.0 16.0 1.0 5.9% Community Development(see note) 223 20.6 1.7 7.6% Recreation 16.0 16.0 0.0 0.0% Public Works(see note) 71.5 68.5 3.0 4.2% Utilities 50.0 48.0 2.0 4.0% Police (see note) 84.0 81.0 3.0 3.6% Fire 54.51 52.51 2.01 3.7% [TOTAL: .... ... 3 363 3n.6 IwJudes Transportation Manager,EngincennyAnistant.Open Space Planner.and overfill Lieutenant positions Vacant Positions By Department Position No. Finance Computer Systems Technician 1.0 Community Development Plan Check Engineer 0.7 Graphics Technician 1.0 Public Works Signal Maintenance Technician 1.0 Transportation Manager 1.0 Maintenance Worker 1.0 Utilities Director 1.0 Water Rec Plant Operator 111 1.0 Police Police Officer 2.0 Records Clerk 1.0 Fire Fire En 'neer 2.0 Note:Additional vacancies due to pending retirements and natural attrition are anticipated by the beginning of 1993-94. 3 \O N V a O OOO Mc. 0v7M \6 N: C \O P f VEO M"Tr*+ N . NO 00 hN O s 0 ov? oono 'nov3000 n [der ADO �O 00� Ur4ry 7 9 � a qd y N ti CL 3 N .--i M •-: N h C c� m a� °i (V C4 N O 4 C R C t O v� 0 O vy ens O v2 .moo v p N cc rjpl a a y M v: O 00 00 S O o0 N � •� O SONO O � h � � .-ice C V Z y LL J o 9 Q � o a, A �, •o �, Z CL 8 ca LU O .. � � > � ti vs � F = v �` d c C7 a Q' ¢UUawU° aa' a° V. a a > 4 CITY COUNCIL = . Regulai Annual Sfafing Savings Line Item Reductions Reduces funding for supplies, contracts, and training from 1992-93 levels by 30%. SERVICE IMPACTc No direct impacts on service delivery but will restrict abilities of Council members to become more informed About constituent concerns and general issues facing the City. $ 16,200 TOTAL RECOMMENDED CUT 0.0 $ 16,200 5 ADMINISTRATION Regular Annual StaflSng Savings CAO's OFFICE Regular Staffing-Administrative Analyst Eliminate one Administrative Analyst position ($57,000) and related supplies ($2,000). SERVICE IMPACT: Will result in a 25% reduction in Administrative Office professional staff. Staffing loss will result in reduced support in the areas of customer relations; HRC and PCC activities; legislative advocacy; and special projects. Also, the CAO and Assistant CAO are likely to have a greater proportion of their time diverted to "project issues" vs. organization-wide issues. Other specific anticipated impacts include: • Eliminating City Lights • Transferring special ceremonies to Council Secretary • Focusing on only a very few legislative priorities • Transferring HRC staffing to Personnel • Possibly transferring PCC staffing to Economic Stability program, if created 1.0 $59,000 Regular Staffing - Secretary Reduce an Administrative Secretary from full-time to half-time. SERVICE IMPACT: With only 3 remaining professional staff members, a half-time secretary, along with the CAO's secretary, can adequately support Administration's secretarial needs (with some loss of efficiency), assuming staff support to HRC and PCC is either reduced or provided elsewhere (Personnel, Economic Stability). If an economic stability position is eventually created under the CAO, then retaining the secretary on a full-time basis would be necessary. 0.5 20,000 Newsletter Eliminate City Lights newsletter. SERVICE IMPACT: With the loss of an analyst position, Administration will no longer have adequate staffing to prepare a quality newsletter. However, staff will explore less costly options for advising the community on important City issues. 20,000 TOTAL RECOMMENDED CUT 1.5 $99,000 6 ADMINISTRATION - Sa _CIAL PROGRAMS HUMAN RELATIONS Grants-In,Aid Reduce funding for community grants from $84,700 to $75,000. SERVICE IMPACT: Will result in a reduced level of grant funding available to social service organizations that serve the City. The level of funding loss, however, is consistent with the overall reduction in the General Fund operating budget 9,000 Homeless Shelter Contract Discontinue General Fund support of homeless shelter contract in 1994-95. SERVICE IMPACT: None, assuming entitlement monies from the Community Development Block Grant Program that will become available in 1994-95 will be used to fund the contract. -0- COMMUNITY PROMOTION Contract Services Reduce agreements with the Chamber, the Visitors Bureau, and the advertising agency by 10°x. This is the same level as overall General Fund operating budget reductions. SERVICE IMPACT: Will result in a general reduction to the City's community promotion program. This could take the form of reduced visitor center hours at the Chamber, a reduced advertising campaign, etc. 24,000 CULTURAL ACTIVITIES Grants-In-Aid Reduce funding for grants-in-aid program from $75,800 to $67,100. SERVICE IMPACT: Will result In a reduced level of funding available for cultural and recreational activity grants. The level of funding loss, however, is consistent with overall reductions in the General Fund operating budget. 8,700 ECONOMIC STABILITY Contract Services Reduce funding for economic stability projects by 28%. SERVICE IMPACT: Will leave a total of$100,000 to serve as "seed money" for the start-up of a more proactive program, once defined. 39,000 TOTAL RECOMMENDED CUT 0.0 $80,700 CITY ATTORNEY `- Regular Annual 37a1fing Savings None ' 8 CITY CLERK Regular Annual Is RECORDS AND ADMINISTRATION Stalling Savings Regular Staffing -Office Assistant Eliminate one Office Assistant position. 1.0 33,600 SERVICE IMPACT: Delays response to citizen and staff requests for information; defers implementing records management program and expanded computerized information systems; precludes implementing expanded conflict of interest requirements; forgoes minutes for Council study sessions. Line Item Reductions Reduce line item funding for supplies, contracts, and training. SERVICE IMPACT: Reduces availability of funding for supplies, training and support services by 11%. May increase records storage expenses and exposure to loss of non-vital records prior to destruction date. 6,800 ELECTIONS Off-Year Election Expenses Eliminate funding for off-year elections ($26,700) for an annualized savings of $13,400. SERVICE IMPACT: No direct impact; if off-year election services are necessary due to unanticipated ballot issues, supplemental appropriations will be required. 13,400 TOTAL RECOMMENDED CUT 1.0 $53,800 9 PERSONNEL Regular Annual Savings ADMINISTRATION Staffing Regular Staffing-Work Health Coordinator Eliminate Work Health Coordinator. SERVICE IMPACT: Will decrease continuity and effectiveness of wellness program and support to the City's safety program with potential of increasing workers' compensation costs and exposures to risk loss. 1.0 $44,700 Regular Staffing-Personnel Assistant Reduce the Personnel Assistant to half-time. SERVICE IMPACT: Redistribution of clerical and required record keeping tasks to other staff will place a greater burden on meeting statutory guidelines for workers' compensation and liability claims administration. 0.5 19,200 Contract Services Reduce expenditures by 26%. SERVICE IMPACT: Reduction in the use of professional negotiators will increase the workload of the Personnel Director. Pre-employment physical will be discontinued for sedentary positions. 16,500 RISK MANAGEMENT Claims Discontinue direct payment of property damage claims under$500. SERVICE IMPACT: These claims will be paid by our insurance adjuster through the JPA. The impact will be minimal on our liability claims deposit with the JPA. 14,900 TOTAL RECOMMENDED CUT 1.5 $X300 10 FINANCE Regular Annual INFORMATION SYSTEMS PROGRAM Staffing Savings Temporary Staffing Eliminate all temporary staffing in the Information Systems Division. SERVICE IMPACT: This cut will require reducing our technical support and in-house training to the operating departments; this may result in a decline in overall organizational productivity. $ 5,500 ACCOUNTING PROGRAM Temporary Staffing Eliminate all temporary staffing in the Accounting Division. SERVICE IMPACT: This cut will require: • Relying on the standard reports prepared by Finance and significantly reducing our response to special purpose requests from staff and public. • Curtailing payroll check distribution as an Internal mail service. • Reducing our ability to respond to peak workload needs without impacts on our day-today service delivery. • Reducing frequency of various internal control procedures. 9,600 Regular Staffing-Accounting Assistant Eliminate Accounting Assistant position in the Accounting Division and related support supplies. SERVICE IMPACTS: This cut Will require: • Planning and executing significantly fewer special projects. • Significantly reducing improvement efforts/greater acceptance of existing capabilities and services. • Eliminating special research assignments from the operating departments- we will assist them in doing the research themselves. • Further reducing the frequency of various internal control procedures. NOTE: These impacts will be mitigated if overall organization activities are significantly reduced as workload demands should be lower. 1.0 35,500 REVENUE MANAGEMENT PROGRAM Regular Staffing-Accounting Assistant Eliminate Accounting Assistant position in the Revenue Management Division and related support supplies. SERVICE IMPACTS: This cut will require: • Transferring responsibility for payment of utility bills from the customer to the property owner-this will significantly reduce our customer service request workload (starts and stops). • Purchasing accounts receivable (A/R) software for all of our LAN's and decentralizing invoice preparation and A/R management • to the operating departments. • Billing transient occupancy taxes quarterly rather than monthly. 1.0 35,500 11 Customer Services Supers r Eliminate Customer Services Supervisor position and related support supplies. SERVICE IMPACT: This cut will require: • Accepting a significant reduction in our customer service Improvement efforts. This In an area where we have made significant improvements over the past year. Specific accomplishments included: - Implementing phone-in requests for utility service. - Eliminating customer deposits. - Piloting credit card program. - Improving our overall customer service policies and strategies. It will not be possible to develop and implement these kinds of improvements in the future without this management resource. • Planning and executing significantly fewer special projects. Recent examples include the business tax update and water rate structure review. • Reducing our quality and internal control capabilities. 1.0 47,000 TOTAL RECOMMENDED CUT 3.0 $133,100 12 COMMUNITY DEVELC 'TIENT Regular Annual Is COMMISSIONS AND COMMITTEES SWUng Savings Reduce Printing Expense SERVICE IMPACT: As proposed, the Historic Plaque Program would be eliminated, fewer copies of the Historic Walk brochure would be produced, and funding for all other commission-related printing would be eliminated. $ 5,000 Reduce Funding for Commission/Committee Meetings and Trips SERVICE IMPACT: Meals for commissioners at their meetings were eliminated last year. However, funds continue to be available for one annual dinner meeting for each advisory body, which this will eliminate ($1,000). Also reduces funding for miscellaneous trips by $700. 1,700 BUILDING AND SAFETY Regular Staffing - Plan Check Engineer Eliminate the Plan Check Engineer position SERVICE IMPACT: Plan check duties will be distributed among remaining staff. Large projects will be sent out to consultants for plan check; engineering and plan check services account will be allocated $20,000 to accommodate contract services. Because inspection staff will assume a portion of the plan check function, same day inspection service will be eliminated. 0.7 29,700 Reduce Data Processing Services SERVICE IMPACT: Additional programs or functions cannot be created without this appropriation. The remaining funds are adequate for maintenance of existing applications only. 3,000 Other Line Item Reductions Reduce printing ($500), video support ($1,500), camera supplies ($300) and microfilming ($1,500). 3,800 SERVICE IMPACT: Not significant: PLANNING Regular Staffing -Office Assistant Reduces Office Assistant staffing from 0.8 to 0.5. SERVICE IMPACT: Prompt response to the public at the counter and to phone calls will be reduced, resulting in delays to requests for information. The ability to have clerical support at the public counter at all times will become more difficult. Some tasks (maintaining the planning library, filing, agenda preparation) will have to be reduced or reassigned. Support for the building division clerical staff will become more difficult. 0.3 11,000 13 Regular Staffing -Graphic :clinician Currently, there are two authorized Graphics Technician positions: one in Community Development and one in Fire. This would eliminate the position in Fire, and consolidate support in Community Development. To appropriately reflect the reduced level of service that will occur in both departments with this cut, one-half of the position reduction has been allocated to each department. SERVICE IMPACT: Legally-mandated maps and materials essential to the operation of the department will continue to be maintained, however creation of new maps and graphics would be limited. Conversion of manually-drawn maps to computer format would be curtailed, requiring greater time for maintenance. 0.5 20,800 Temporary Staffing Reduce temporary staffing from $24,500 to $14,500. SERVICE IMPACT: Some tasks (microfilming, delivery of agendas) will be transferred to regular staff. Regular staff would, in turn, eliminate other tasks to accommodate legally-mandated functions thereby reducing service levels for processing planning applications. Costs to the City for legally-mandated tasks, such as notification, would be higher if done by regular staff, so partial funding is being maintained for limited services. Funding would also continue for Planning Commission minute clerk. 10,000 Regular Staffing -Associate Planner Eliminate Associate Planner position. SERVICE IMPACT: Eliminating one Associate Planner in the Development Review Division will reduce efficiency and delay permit processing by as much as 25%. The service impacts will be mitigated somewhat through implementation of an effective permit streamlining program (already under way). However reduced staffing may delay the implementation of those improved regulations. Department priorities will shift to emphasize planning permit processing at the expense of special projects, such as revised ARC Guidelines and ordinance clean-up/streamlining. 1.0 49,700 Other Line Item Reductions Reduce office equipment maintenance ($4,000), camera supplies ($500), office supplies ($1,800), and other materials ($5,000). SERVICE IMPACT: Not significant. 11,400 Eliminate Planning and Research Services SERVICE IMPACT: No ongoing funding will be provided for unanticipated contract services. If consultant services are necessary, additional appropriations will be requested from the Council on a case-by-case basis. 23,700 Reduce Data Processing Services SERVICE IMPACT: Funding is for maintenance of existing applications only. Additional programs or functions could not be . created without additional appropriation. Existing staff would have to be trained to take on minor programming and data manipulation functions. Service levels to other staff or governmental agencies which utilize our data will be reduced. 2,300 TOTAL RECOMMENDED CUT 14 2.5 $172,100 RECREATION Regular Annual 57a11'ng S1111ings Is RECREATION ADMINISTRATION Eliminate two sedans Reduce the number of vehicles by two sedans leaving two trucks registered as Recreation vehicles. SERVICE IMPACT: Increased coordination among staff for access to transportation. Trucks are the primary vehicles assisting In the production of events, programs and activities. $ 7,800 Regular Staffing -Recreation Coordinator Eliminate 1 Recreation Coordinator. SERVICE IMPACT: Will require redistribution of brochure production, distribution, small event operations and pre-school administration between existing staff. 1.0 44,700 Regular Staffing -Recreation Supervisor Eliminate 1 Recreation Supervisor. SERVICE IMPACT: Implement the two supervisor alternative not adopted by Council but proposed in the Hughes/Heiss Reorganization Analysis. Will require alignment of divisions to two supervisors and five coordinators. Regular staffing cost savings of$41,800 are partially offset by the need to augment temporary staffing by $8,000 to assist in program operations. 1.0 33,800 AQUATICS Line Item Reductions Costs associated with contract services, training for regular staff, equipment replacement costs. SERVICE IMPACT: Extend use of equipment for classes, (ie. kickboards, safety and first aid equipment, etc.) eliminate contractual arrangements for the masters program. 1,700 SPECIAL INSTRUCTION Temporary Staffing Reduce temporary employees and associated employee costs, (ie. medicare, workers compensation, etc.) associated with babysitting costs with payment to be absorbed by instructor. 1,800 TRIPS AND OUTINGS Line Item Reductions Reduce those trips and outings activities that could be provided in the private sector or are not recovering total expenditures. 16,000 TOTAL RECOMMENDED CUT 20 $105,800 15 PUBLIC WORKS Regular Annual Staffing Savings ADMINISTRATION Line Item Expenditures Eliminates funding for employee recognition ($2,000) and reduces funding for office supplies ($6,000) and printing ($9,000). $ 17,000 Temporary Staffing Eliminates one temporary Technical Assistant position (360 hours/0.2 full-time equivalents). SERVICE IMPACT: There might be a shortage of clerical assistance for the transportation planning and engineering program. $ 2,700 Regular Staffing-Secretary Reduce one regular secretary position at the Corporation Yard from full-time to half-time. SERVICE IMPACT: If Public Works and Finance can work out a simplified system for preparing payment vouchers, there should be little effect on clerical operations. With fewer hours available for answering forwarded phones and relaying messages, supervisory employees at the Corporation Yard might have to use answering machines on their phones when they are out in the field. 0.5 19,100 PARKS AND LANDSCAPE MAINTENANCE Trash Removal from Containers in Parks Eliminate one temporary Field Worker position (1,000 hours/0.5 full- time equivalents) assigned to collect trash from containers in parks. SERVICE IMPACT: Regular employees would collect trash from containers in their assigned areas when containers were near full. Trash might remain in containers for several days instead of being picked up daily. 7,300 Regular Staffing -Parks and Building Manager Eliminate the Parks and Buildings Manager position. SERVICE IMPACT: All of the parks and tree maintenance programs would be consolidated with the streets and equipment maintenance programs under one manager. The building maintenance program would be placed under public works administration. First-line supervisors would have to assume more budget and policy responsibility, with assistance from public works administration. The Streets Manager's span of control would expand to six supervisors. 1.0 68,000 CMC Labor for Park Maintenance Discontinue contracting for the use of inmate labor from California Men's Colony. SERVICE IMPACT: Because CMC can no longer pay for required supervision, it will not be offering the use of inmate labor until further notice. In the past, the parks and landscape maintenance program has used about 4,000 hours of inmate labor each year. Time spent on tasks such as litter control, weed control, edging, and rough pruning would be substantially reduced and would result in poor appearance of open space areas and medians. 4,000 16 Balifield Maintenance Eliminate five temporary Field Worker positions (2,200 hours total/ 1.1 full-time equivalents) assigned to groom and mark baseball and Is softball diamonds from April to November where the cost of such work is not reimbursed. Discontinue leasing trucks for these positions. SERVICE IMPACT: Regular City employees would continue to mow, edge, water, and fertilize the turf. The work to be eliminated would include only dragging the infields and chalking foul lines and batter's boxes. Leagues would have to contract for this work or find volunteers to do it. 19,700 TREE MAINTENANCE Tree Promotion Activities Reduce the advertising budget for the citizen reforestation and Arbor Day and Heritage Tree activities from $6,000 to $3,000. SERVICE IMPACT: The citizen reforestation project has successfully promoted awareness of the importance of trees to the community and encouraged citizen participation in tree planting. Revenues from citizen contributions are assisting in financing the project. A portion of each contribution to the project would be earmarked for advertising and mailing costs. 3,000 Tree Planting Reduce budget for planting new trees or replacing trees damaged or destroyed. SERVICE IMPACT: Fewer new trees would be planted each year. This will be partially mitigated by trees planted through the citizen reforestation project. 4,100 BUILDING MAINTENANCE Houseplant Maintenance Discontinue the contracts to furnish and maintain houseplants at City Hall, 955 Mono, and the Corporation Yard. SERVICE IMPACT: Hallways and open office areas will look starker as plants are removed. 2,500 Janitorial Maintenance Discontinue contracts for janitorial maintenance at the Meadow Park Recreation Building, Sinsheimer Stadium Concession Stand, 860 Pacific, the Recreation Center, the Senior Center and the Corporation Yard. SERVICE IMPACT: Regular employees would perform the following minimum basic janitorial tasks: cleaning and sanitizing restrooms and breakrooms, mopping and buffing hard floors, emptying central containers for trash and recyclable materials, and replenishing paper supplies. Building occupants (including possibly recreation staff at recreation buildings and seniors at the Senior Center) ' would be responsible for all other services such as: emptying trash and recyclable materials from offices and workstations, vacuuming carpets, and dusting furniture. (Similar services at City Hall and 955 Morro have already been discontinued). 28,200 17 GENERAL STREET MAIN. .ANCE PROGRAM Regular Staffing - Maintenance Worker Eliminate one regular Maintenance Worker position ($38,100); eliminate the budget for sidewalk repair by contract ($10,000); and reduce the total hours of temporary field workers (from 1,000 to 500 hours/0.3 full-time equivalents) who work on sidewalk repair ($4,000). SERVICE IMPACT: Two regular Maintenance Workers and a part-time temporary Field Worker would continue to perform sidewalk repairs, but the backlog of sidewalk repair work would grow. Temporary patches would maintain safety but would be relatively unsightly and could need to be replaced as often as every six months. Residents would not always receive timely responses to requests for repairs. 1.0 52,100 Lane Line Repainting Discontinue the contracts for lane line repainting. SERVICE IMPACT: These contracts are no longer required. The street painting crew has discontinued curb painting and repainting where posted signs suffice and safety can be maintained. Also, the crew has finished converting street legends ("STOP", "SLOW", etc.) to long-lasting paint. These changes have freed up enough time for the crew to resume all lane line repainting work. Some contract lane line painting would continue under reconstruction, resurfacing and chipsealing projects. 22,500 Welding Repairs Eliminate the budget for welding repairs to tree well frames, signposts and other street furnishings. SERVICE IMPACT: Brick and sand tree wells would replace steel frames when repairs could not be accomplished by city workers. The appearance of a few tree wells would not be consistent with others. 5,700 Sidewalk Grinding Discontinue sidewalk grinding by contract. SERVICE IMPACT: Sidewalk grinding is a quick method of sidewalk repair where the concrete is simply ground down to eliminate hazardous displacements. It is more permanent and better-looking than a patch. Maintenance crews could continue this work if a grinder and trailer could be purchased for $10,000. This will be considered as a part of the final budget process. 6,500 PAVEMENT MAINTENANCE PROGRAM Thursday Night Barricade Removal Eliminate two temporary Field Worker positions (total 680 hours/ 0.3 full-time equivalents) assigned to set up and take down barricades for Thursday night farmers markets. SERVICE IMPACT: Regular employees would set up barricades at the end of their shift. At the end of farmers market, police patrol officers or BIA merchants would have to move barricades out of the street for disassembly and removal the following morning. This procedure would duplicate past practice, which worked well but was somewhat less convenient. Public works staff has notified the BIA of this proposal and has preliminarily received no objections. 5,000 18 Trash Removal from Street _Aminers Eliminate one temporary Field Worker position (1,000 hours/0.5 full-time equivalents) assigned to collect trash from containers in the downtown and at bus stops. SERVICE IMPACT: Regular employees from the paving crew would perforin this work. A reduction in minor pavement failures would allow redirection of regular employees to this task. 7,500 Regular Staffing-Street Projects Coordination Eliminate the Streets Project Coordinator position. SERVICE IMPACT: Engineering would have to manage minor capital projects for streets. Utilities staff would assume primary administration of the Corporation Yard local area computer network. Public works administration would have to assume coordination of service contracts. 1.0 55,000 Regular Staffing- Heavy Equipment Operator Eliminate one regular Heavy Equipment Operator position ($42,400). Reduce the budgets for street sweeper fuel and replacement brooms ($7,600). SERVICE IMPACT: With service reductions made on November 10, 1992, the current street sweeping standard is six times a week on downtown streets, once a week on major arterials, and once every three weeks on remaining streets. Frequency would be established at to five times a week on downtown streets, once a week on major arterials, and once every four weeks elsewhere or as needed to keep storm drainage systems from clogging with debris. Streets would be marginally dirtier. Debris on major arterials would remain in bicycle lanes for a longer period. 1.0 50,000 ENGINEERING Engineering Consultant Services Eliminate contingency budgets for planning and research and for laboratory services. SERVICE IMPACT: No direct effects. 3,000 Temporary Clerical Staffing Eliminate a temporary Technical Aide position (400 hours/0.2 full-time equivalents). SERVICE IMPACT: There would be no secretarial staffing during vacation and sick leave periods. There would be no extra help during periods of heavy workload. 3,000 Blueprinting Supplies Reduce the blueprinting supplies budget from $10,000 to $6,000. SERVICE IMPACT: No direct effects. Current expenses for blueprinting supplies are running at an annual rate of about $6,000. 4,000 19 Regular Staffing-Supem. d Civic Engineer Eliminate one Supervising Civil Engineer position. SERVICE IMPACT: The engineering program staff would be consolidated under one Supervising Civil Engineer, whose span of control would be four or six, depending on the organization of design section into either of two alignments. If one of the Engineering Assistants were to become registered as a Civil Engineer, then design section might be organized under that position. An alternative organization might create three design teams (each with one engineering assistant and one engineering technician) which would report to the Supervising Civil Engineer. The Engineering Assistants would have to take on more responsibility for scheduling and monitoring progress on CIP projects and for keeping standard specifications up-to-date. The engineering program would lose valuable structural engineering experience. 1.0 72,700 TRANSPORTATION PLANNING Regular Staffing-Transportation Manager Eliminate the regular Transportation Manager position. SERVICE IMPACT: The City Engineer will have to permanently work at least half-time supervising the transportation section, with associated loss in management oversight in engineering activities (development review, design, and inspection). 1.0 91,000 TOTAL RECOMMENDED CUT 6.5 $M'600 20 POLICE Regular Annual - St'aff'ing Savings Is ADMINISTRATION Animal Control Contract Eliminates $9,000 for the City's portion of the school educational programs and $5,000 for dead animal pickup. Public Works has indicated that they can handle the animal pick-up and disposal. SERVICE IMPACT: Reduces educational opportunities; impacts productivity In Public Works. $ 14,000 Line Item Accounts Reduce POST and non-POST training accounts, meetings, and selected reductions in pagers and cellular telephones. SERVICE IMPACT: Reduces training to state mandated or job essential levels. The reduction in pagers may mean some extended responses for off-duty investigators and line SWAT personnel. 34,500 Booking Fees Release all misdemeanor arrestees who are not a danger to themselves or others on their written promise to appear without booking them at County jail. This may increase (or decrease) the amount of time an Officer is away from the field with an arrestee. SERVICE IMPACT: Unknown impact at this time, but we will monitor and return to Council for review if significant adverse impacts develop. 75,000 Regular Staffing-Police Lieutenant Eliminate one Police Lieutenant position. SERVICE IMPACT: While staff will evaluate the situation in light of total cuts, the recommended reduction will probably be the Administrative Lieutenant. Program management functions for nuisance abatement, false alarms, second response violations, cost recovery, and permits will be tasked to units in both the Administrative and Operations bureaus. These will impact the workloads of these other units and will reduce available field time for those tasks assigned to patrol staff. 1.0 87,200 Regular Staffing -Crime Prevention Coordinator Eliminate one non-sworn crime prevention position. SERVICE IMPACT: This position has been the primary position responsible for keeping crime statistics, facilitating crime prevention presentations, coordinating the ride-along program, and representing the Department in community events. These duties will be divided among both the Operations and Administrative Bureaus. This will limit the number of public presentations we are able to make and will potentially decrease available patrol time if some field officers are used for presentations. 1.0 51,900 21 TRAFFIC Regular Staffing - Police Officer Eliminate the Commercial Enforcement Officer position. SERVICE IMPACT: Specific commitment to commercial vehicle enforcement will be lost. Some decline in overall enforcement revenue by reducing this Traffic Unit position is possible. This also represents a direct loss of field police resources. 1.0 60,800 Regular Staffing - Police Sergeant Eliminate the Traffic Sergeant position. SERVICE IMPACT: This will require restructuring supervisory responsibilities for the unit and will remove a uniformed supervisor from field deployments. This is a direct loss of available police resources in the field. Administrative duties such as special events coordination and representing the Department on various City committees will be reassigned within the Operations Bureau. 1.0 78,600 SUPPORT SERVICES Temporary Staffing Eliminates phone back-up and Records Unit relief position. SERVICE IMPACT: Returns peak phone workloads to communications, records, and secretarial positions. It will also mean overtime should we have extended illnesses or vacancies in the Records Unit. 5,500 Regular Staffing - Records Clerk Eliminate one Records Clerk from the unit. SERVICE IMPACT: During busy times of the year, requires an extended turn around on routine reports to the public. It will also mean a continuation of the recent changes in the hours that Records is open to the public. This will be done to ensure that court documents are ready within legal time requirements. 1.0 37,100 Fleet Reduction Reduce fleet maintenance and operation costs. SERVICE IMPACT: With the loss of field positions, we anticipate this amount of annual savings based on the reduction of the fleet and reduced maintenance costs. 12,000 Regular Staffing-Communications Technician Eliminate one Communications Technician position. SERVICE IMPACT: Cuts additional staffing provided for peak activity periods. May require Communications Supervisor to be assigned to a regular shift. Additionally, an increase in overtime may occur to fill in for periods when vacancies exist either for extended illness or replacements due to resignations. 1.0 48,000 TOTAL RECOMMENDED CUT - &0 $504,600 . 22 FIRE Regular Annual Is Sta>Tng Savings ADMINISTRATION Line Rem Reductions Reduce various departmental line item budgets. SERVICE IMPACT: As this level the Department is at absolute minimum funding. The department's Fitness, Hydrant Maintenance, and Public Education programs will be impacted significantly. $ 18,500 Temporary Staffing Eliminate temporary staffing. SERVICE IMPACT: Temporary employees will not be utilized to maintain the City's fire hydrants and a portion of the Weed Abatement program. Work will be reassigned to engine companies, which will impact the Engine Company inspection program. 10,200 EMERGENCY RESPONSE Regular Staffing - Fm: Engineers Delete three Fire Engineer positions. SERVICE IMPACT: Removing one position from each shift will reduce the scheduled firefighter force by one person 24 hours a day. By more closely coordinating time-off schedules, reducing out of area training, and using overtime when necessary, minimum staffing levels currently in place of 12 per shift will be maintained. Regular staffing savings of$198,600 will be partially reduced by Increased by increased overtime estimated to cost an additional $56,000 annually. 3.0 142,600 HAZARD PREVENTION Regular Staffing -Fire Education Specialist Delete Fire Education Specialist position. SERVICE IMPACT: Community interaction would be reduced significantly. On scene media coordination would be delegated to other responding personnel. Coordination of the annual Open House and school activities would become the responsibility of the remaining Fire Prevention staff and engine companies. On site safety drills conducted at businesses would be eliminated as would the consistency and coordination with news media. 0.5 26,400 Regular Staffing-Fire Prevention Delete one position from the Fire Prevention unit. SERVICE IMPACT: Citizen complaints will not be handled in as timely a manner and customer service will be reduced. Code enforcement would fall to remaining Fire Prevention staff causing a potential log • jam of enforcement issues or a significant reduction in code enforcement activities. Hazardous occupancy inspection would become less frequent. Fire investigation duties would have a much greater impact on available time of remaining Fire Prevention staff and engine companies. 1.0 54,300 23 TECHNICAL SERVICES Regular Staffing-Graphics Technician Currently there are two authorized Graphics Technician positions: one in Community Development and one in Fire. This would eliminate the position in Fire, and consolidate support in Community Development. To appropriately reflect the reduced level of service that will occur in both departments with this cut, one-half of the position reduction has been allocated to each department. SERVICE IMPACT: The County 911 Emergency Response Map Book will no longer be updated. A significantly reduced level of graphics support for Training, Public Education and general use will be available from Community Development. 0.5 21,500 TRAINING Regular Staffing - Battalion Chief Eliminate the Training Battalion Chief position. SERVICE IMPACT: An accepted axiom over the years has been that "a Fire Department's success is directly attributable to the effectiveness of its training program". The loss of the Training Officer's position will have a long term impact on the Department's preparedness. Workload will be reassigned to fire suppression staff, having a direct impact on engine company inspection program. 1.0 82,100 Training Reduce the training budget by $20,000. SERVICE IMPACT: The training budget reduction is primarily achieved in the areas of outside training and physical fitness tracking. The inability to send individuals to high quality outside training will affect staffs ability to stay abreast with current trends and methods. The loss of this upper level training will negatively affect the performance of personnel. Reduction at this level will also have significant impacts on the department's fitness program which may result in increased workers' compensation costs and sick leave use. 20,000 TOTAL RECOMMENDED CUT 6.0 $375,600 24 Section D TASK FORCE REPORTS • This section presents the findings and recommendations of five "task.forces" formed by the CAO to provide the Council with a wide range of management options in addressing our fiscal problems. Contents M Tax Override for Public Safety Task Force 1 O Federal/State Grants Task Force 5 s Prevailing Wage Task Force 11 M Employee Work Group 13 M Revenue Task Force 17 MEMORANDUM TO: John Dunn, City Administrative Officer FROM: James M. Gardiner, Chief of Police r"A DATE: February 24, 1993 SUBJECT: Public Safety Tax Override Task Force The Public Safety Tax Override Task Force was charged with looking at the options and advisability of initiating a ballot measure to implement a tax for public safety purposes. The members of the committee consisted of myself, Wendy George, Cindy Clemens, and Erwin Willis. We found that this was a very complicated issue fraught with legislative, legal, and procedural challenges. Therefore, each member of the task force was assigned a particular research component for the project. The following is a summary of our process and findings. Tax Options: Special taxing options for support of public safety programs basically come in two varieties. The first is the Gann Tax Override. This only applies to situations in which the city has reached its Prop. 4 Gann spending limit This allows for a local election with passage by a simple majority to authorize the use of the "excess" funds to support these local programs. This is the process which Pismo Beach used to support additional police and fire resources. Unfortunately for us, we are a long way from our Gann limit Therefore, this approach is not available to us. The second and most well known would be a special tax as authorized under Article XIII of the California Constitution. This is the section created by Proposition 13 in 1978. Under this section, a local entity can impose a tax for public safety purposes with the approval of 2/3rds of the voting electorate. This is specifically authorized under Government Code Section 53978. The section allows for purchase of equipment and paying the salaries and benefits of police or fire personnel. The tax is for new personnel and may not be used to support existing services. The tax is assessed on parcels and Wthe amount is established by the legislative body. The assessment may be varied to each parcel based on the amount of services provided. Agency Surveys: We conducted a survey of the contiguous counties and those agencies which we knew had attempted a tax override for police or fire purposes. A list of agencies from the three ' counties and the respective outcomes is attached. In summary, the list shows that the vast majority of overrides have been focused on providing paramedic or fire services. The survey showed that these entities had the most success when the approach was a Gann override. 1 Public Safety Tax Override Tax Force Page 2 February 24, 1993 There are some special districts which show a passage of a special tax by a simple majority. This was due to a loop hole in the law which was closed by a recent Supreme Court decision. These now require a 2/3rds vote. The largest agency which tried an override was the city of Los Angeles in last years general election. There were two measures directly related to police services. One measure for improving the police radio system passed with the 2/3rds majority. The other measure which would have added police officers had over 60% approval but failed to garner the 2/3rds necessary for passage. The Salinas Police Department measure failed miserably when the opponents started a fear campaign by saying that the additional police officers would be used to enforce immigration laws. In contacting a number of both the successful and the unsuccessful, three major points were emphasized. First, the 2/3rds requirement is extremely difficult unless the services are a clear and demonstrable benefit. Second,the voters must clearly believe that normal revenue sources are being spent in an appropriate manner and that the new tax is necessary. Third, an attempt at an override should only be attempted after carefully assessing the opinions of the voters in that entity. Voter Survey: If a decision was made to pursue a public safety override, the first step should be a voter survey. Based on our contacts it is estimated that this would cost between $10,000-12,000. The amount of time necessary to complete the survey would depend on the amount of information to be elicited and the survey method. Election Timing: Another factor to consider would be the timing of the election. Special elections are more expensive but have a more focused turnout. That can be either good or bad depending on the education or voter turnout efforts. RECOMMENDATION: Based on the information we have at this time, it is our recommendation that all other efforts be examined before attempting a tax override. Since the 2/3rds vote is so difficult to obtain, we feel that the public will have to believe that all other avenues of resolving the financial problems have been exhausted before they will vote an additional tax. Attachments: Survey summaries 2 v m o m0Z m p u � n C y c �+ 0 � % V � O O m � r- ma > ago cn c c 0 CO cn Z CO (D co co v u 3 r W 0 C. 0 0 0 0 0 > > .0 c naa as m � � V a a a Q a W 0 V O E E E m m E E E :: °' "0 v v o > > > > > a 0 0 0 0 0 0 0 W naa na a m m w a s a > wnN mw to D «: LU V E dCL O Q Q r o LL. u7 F- m= vJ z W ` r a W W C 0 w r W O a Y. Ev a p n V m ` _ Z E 10 IL W p .0 ~ >LL H > •zo 000 0 W Z a w t 0 � o Vr .. « > > c Q K V H N h V V 2 3 C � E W c 3 C W y G y O 0 W N ULL P w y C C C 3 O p O v y d � 61 p d .O Y V W m VM m r a a'C d N E E O C w C � E r C m m d w E a E E E 3 d E r Y r m Y d � w `p m d O 0 0 0 ~ O 'O 0 0 0 0 cc CL CL CL CLC C C i d a a a Q E d d U' O LU J Lao m m m LL Q Q Q Q Q LL m C m U. O 0 0 o cE of OR -,R o a PtOPtO LO OOOOOh � h U y to LnLptO WrnOhLOh ,O m C a m y d r Vl > U � r _U V r l0 1p d dj5C X my m E v av m E cc ¢ O r m O > O a > > > d a C O w 0 > Q u0 u A O x x w � " x m m c c s K x x Q H d m T CIO V ° H ° �o a Fm- Fm- Lu ~ 9 a W a e C v c c c ' r y LL IL m m d d C C C m d c - d m C d >. a m m m a a p a a d t d V) LL c7 LL to C7 C7 C7 to to m � to to p c m m > LL t°n E v m m p v Y a v > Q w v LLI y N C i C 0 N w W tp H C d a c 4 u f0 O ' U c EO m Z a p m = a d Q O t' C E = LL r r d C U. w aF' wO u ° r O d C V LL c r° mc w a CL ° Ez a oG m d >a oo Y AV LLL m � M = L)0 d y Cc lL Z LL m y Y p d C U C d dCL .3 .5 m � V y O d a tr c E T> CL LL ao p w d > 0 z m m O m Q m U M d d w w ani adi OI pi o v m d LLJ J r pup d 61 m m Y Y Q Q a d u C7 Z E t c Z tvcEcmE 19 w amcd Q t/i woE: ow20 tan in 2 z � mt� 2vo <` U) ¢ as �sscastnQ 4 MEMORANDUM March 2, 1993 TO: JOHN DUNN, CITY ADMINISTRATIVE OFFICER FROM: DEB HOSSLI, ADMINISTRATIVE ANALYST �� SUBJECT: FINDINGS FROM THE GRANTS TASK FORCE Background The Grants Task Force was charged with comprehensively reviewing how we can more aggressively pursue grant funding to finance projects and programs in light of the financial constraints currently facing the City. The Task Force was composed of Terry Sanville, Linda Asprion, Jeff Zimmerman and myself. In order to carry out our charge, each member of the group took responsibility for researching an area of the City. Our research primarily focussed on interviewing our own staff, staff from other government agencies (other cities, the County, the State, and the Federal Government), and the League of California Cities to determine what types of grants are currently available as well as their future funding outlook. Using the information gained from the interviews, the Task Force has developed the following overview that sets out where grants look promising, where they don't, and how they can best be used to augment the City's financial resources. The Task Force also prepared recommendations for encouraging and managing an aggressive grant program. Overview of Task Force Findings In summary the Task Force found that (attachment 1 provides a more detailed discussion of the grants highlighted in this section): ■ Grant opportunities appear to be the most promising in the areas of transportation and community development. The City stands to gain $1.4 annually in this area by 1994-95. This is primarily the result of the City's recent designation by the Federal Government as an urban area. With this designation, the City will receive a pre-determined amount of entitlement funds for transit capital and operating expenses (between $400,000 and $500,000 annually starting in 1993-94) and community development activities that benefit the low and moderate income sector of the community (eligible projects are typically related to affordable housing and economic stability activities - we expect to receive approximately $800,000 annually starting in 1994-95). In addition, the Intermodal Surface Transportation and Efficiency Act (ISTEA), will provide approximately $185,000 annually for transportation construction ' projects. ISTEA will also sponsor a grant program that will make $600,000 available to the county on a competitive basis for transportation enhancement 5 projects: ■ On a lesser scale, grants and low interest loans to support fire services appear to be viable sources of funding. Competitive grants are available to offserthe costs of specialized training, emergency medical services equipment, and hazardous materials activities. The Federal Government also offers low interest loans through the Department of Housing and Urban Development for fire station construction. Because these types of grants are competitive and funding levels change from year to year, it is difficult to estimate at this time the amount of dollars the City could ultimately receive. ■ At first glance, grants for police services appear promising. However, closer inspection reveals that most grants for police oriented activities primarily fund enhancements to existing programs for a limited period of time and cover costs of staffing and supplies. Examples include grants offered through the Office of Criminal Justice Planning to enhance victim assistance or drug and gang prevention programs. Grants of this nature can be very beneficial if the recipient agency is in the position to continue to fund the enhancement once the grant expires. Given the City's current financial limitations, however, grants that offer short-term commitments for enhancements to operations (e.g., staffing and supplies) will only serve to aggravate the City's financial position if the desire for the program remains once the grant funding is no longer available. ■ Grants opportunities in the area of recreation activities appear to be non- existent. Most grant programs benefitting recreation have traditionally been funded through State Bond Acts. Because these monies are now depleted, very few grant programs remain. Of those still remaining, funding is very limited (e.g., only $500,000 was allocated to all of southern California for Land and Conservation Program grants). ■ As with recreation, grants to fund utilities improvements (e.g., water and sewer) are non-existent. Long-term, low interest loans, however, are available to finance reclaimed water projects or upgrades to waste-water facilities. In summary, the Task Force has concluded that grants from State and Federal agencies represent a viable source of funding for the City to aggressively pursue, particularly in the areas of transportation, community development and fire services. In making this statement, however, it is important to emphasize our research has revealed that almost all the grant programs discussed above are structured to encourage local government to improve services or facilities, not to supplant funding for existing operations. In addition, many of the grants discussed above require some, level of matching funds from the City and are expensive to administer due to cumbersome and excessive reporting requirements. Therefore, we should not view grants as a way to solve the City's financial problems as very few of the dollars derived from grants can be applied directly to this purpose. Rather, we should view 6 them as an opportunity, on a case-by-case basis, to ease reductions in services as the City embarks on preparation of the 1993-95 Financial Plan. Task Force Recommendations Based on our research, the Task Force also offers the following recommendations: ■ Aside from entitlement grants, the City should focus its efforts on securing grants for capital projects. This approach will allow the City to complete projects we might not otherwise afford while maintaining financial independence should future grant funding sources diminish. ■ Until the City's financial situation significantly improves, the City should avoid grants to fund "pilot" programs or short-term staffing enhancements to existing programs. Taking on these types of grants could ultimately aggravate the City's financial position should the desire for the program remain once the grant funding is no longer available. ■ The City should develop a simple, department based system that tracks grant. funding availability more aggressively on an ongoing basis. A first step in this direction would be to require departments to evaluate the availability of grants and provide documentation of their potential as part of any capital funding request. ■ The City should adopt a grants management policy that clearly sets out a process and identifies responsibilities to insure that grants are: (1) properly analyzed prior to submitting an application (e.g., a cost-benefit analysis), (2) properly managed after receipt, and (3) properly closed out. The Finance Department has already completed a draft grants management policy for your consideration. Attachments: 1 - Grant Availability Listing 7 Attachment 1 Grants Availability Listing The Areas Where Grants Look Promising... ■ TRANSPORTATION A. New Sources iSTEA -The Intermodal Surface Transportation Enhancement Act, funded with monies from the Federal Government, has two primary programs that will benefit the City: (1) STP Program (formerly the FAU Program) will provide approximately 185,000 annually over the next six years for transportation construction programs - this program requires a 12% match; and (2) Transportation Enhancement Act Program (TEA) will provide approximately $50 million annually over the next six years statewide (it is estimated that $600,000 will be allocated to our County annually) for transportation enhancement projects (e.g., bike trails, bike racks, etc.) - this program requires a 10% to 12% match and will be made available on a competitive basis (we are currently applying for the first 1993-94 cycle). Section 9 - With the City's recent designation as an urban area by the Federal Government, we will receive an entitlement of $400,000 to $500,000 annually (beginning in 1993-94) for transit capital and operating costs - capital uses require a 20% match and operational uses require a 50% match. B. Ongoing Sources TDA - The City will continue to get Transportation Development Act monies from the State of California to support transportation activities. We currently receive approximately $560,000 annually, although it is likely that we will see a reduction in the coming year due to the State's fiscal crisis. Partnership Program - The City will continue to participate in this program. It provides reimbursement for roads maintenance projects of up to 50% from the State. The monies are made available on a competitive basis statewide so the reimbursements can fluctuate from year to year (e.g., we will receive a 20% reimbursement for 1990-91 projects which equates to approximately $240,000). . 8 ■ COMMUNITY DEVELOPMENT A. New Sources CDBG- With the City's recent designation by the Federal Government as an urban area, we will be eligible to receive approximately $800,000 annually in Community Development Block Grant entitlement monies beginning in 1994-95. CDBG monies must be used for projects that benefit low and moderate income (eligible projects are typically related to providing affordable housing and economic stability activities). The City must adopt a Comprehensive Housing Affordability Strategy (CHAS) and Housing Element before we can take advantage of the monies. The possibility of becoming an urban county is also being explored in an effort to increase the level of funding from the Department of Housing and Urban Development. HOME - This represents another housing related grant program funded by the Federal Government that the City may be eligible for if we opt to become an urban county. No estimates are currently available as to how large an entitlement grant we could receive. ■ FIRE A. New Sources Competitive grants are available from the State and Federal Government to offset the costs of specialized training, emergency medical services equipment, and hazardous materials activities. The Federal Government also offers low interest loans through the Department of Housing and Urban Development for fire station construction. Because these types of grants are competitive and funding levels change from year to year, it is difficult to estimate at this time the amount of dollars the City could ultimately receive. However, it does appear that grants represent a viable source of funding to augment fire related resources. The Areas Where Grants Look Less Promising At This Time... ■ POLICE There are still a significant number of State grant programs to support police oriented activities. However, most of these grants primarily fund enhancements to existing programs for a limited period of time and cover costs of staffing and supplies. Examples include grants offered through the Office of Criminal Justice Planning to enhance victim assistance or drug and gang J prevention programs. Grants of this nature can be very beneficial if the 9 recipient agency is in the position to continue to fund the enhancement once the grant expires. Given the City's current financial limitations, however, grants that offer short-term commitments for enhancements to operations(e.g., staffing and supplies) will only serve to aggravate the City's financial position if the desire for the program remains once the grant funding is no longer available. ■ UTILITIES Apparently there is a general recognition that most utilities are funded through enterprise funds, and as such, grants are seldom made available. Low interest loans, however, are available to finance reclaimed water projects or upgrades of waste water facilities (we are currently taking advantage of a low interest loan to upgrade our waste water treatment facility). ■ RECREATION All State Bond Act monies for recreation activities have been committed, and as such, there are very few grants available for recreation activities. Of those that are available, the funding is very limited: (1) the Land and Conservation Program which funds projects to acquire or develop outdoor public recreation facilities sets aside $500,000 annually for all of Southern California (we have received these grants before); (2) the California Department of Forestry sponsors a tree planting program under which a city or county can receive a maximum grant of $200,000 annually (we are currently applying for the 1993 cycle); and (3) the Habitat Conservation Fund sets aside $2,000,000 statewide on an annual basis for habitat protection activities. ■ SOCIAL SERVICES With our urban status, we may be eligible for entitlement McKinney Act monies to support social service type activities (to offset our homeless shelter contribution as an example). However, the EOC currently applies directly for these monies - so unless we could get substantially more dollars - it makes sense for EOC to continue to apply directly. 10 February 24, 1993 TO: 'John Dunn, City Administrative Officer FEB 2 1:093 FROM: Wayne A. Peterson, City Engineer Chair - Prevailing Wage Tas4 �..:.. ..:: ......:::�; SUBJECT: Prevailing Wage Law Task Force Report This task force, consisting of John Moss, Jeff Jorgensen, Ann Slate, John Hawley and myself, was assigned the responsibility to look into whether the city could remove the requirement in city contracts that makes a contractor pay "Prevailing Wages" to their employees. State law requires state agencies and subdivisions of the state to require contractors working on "Public Works" projects to pay their employees a "Prevailing Wage. " The amount of the "Prevailing Wage" is established by the Director of the Department of Industrial Relations. In general the rate established is the same as that established by collective bargaining units within the region of the work. The City of San Luis Obispo is a Charter City. As such it has the authority to establish whether or not "Prevailing Wage" is a requirement of public works projects which are clearly within the realm of "municipal affairs. " This right was tested in 1981 when San Diego, also a Charter City, adopted a resolution which rescinded its previous prevailing wage resolution and declared that prevailing wage would only be paid when required by federal or state grants and on other projects considered to be of state concern. The state department of Industrial Relations challenged the city in court and the court found in favor of the City. San Luis Obispo's Municipal Code, section 3. 36.010 states that "in every contract for the performance of labor on public works, eight hours shall constitute a day's work, and the contractor and all subcontractors under him shall pay their employees on the work a salary or wage at least equal to the prevailing salary or wage for the same quality of service rendered to private persons, under similar employment in the city. " Staff's application of this regulation has been to require each contractor to comply with the state labor law and to pay each employee in accordance with wage rates established by the State Department of Industrial Relations and to comply with related reporting requirements. These wage rates are probably higher than the rates required in the municipal code. The reason staff has done this is that there is no way for a small agency to establish what is the local wage (as required in our ordinance) for each and every type of trade that might be used on each job. San Diego had the very same problem which is why they adopted their resolution in 1980. The state labor law does apply to every project which uses Federal or State grants and for projects which are J "of state concern. " Contractors who build our projects must pay all their employees the "prevailing wage" . This wage is typically the same as the "union wage". For non union contractors this may mean paying 11 employees at a higher rate during the time they work on our projects as compared to the wage they earn when they work for others in the community. Most of our City building, water and sewer projects, that are paid for with local money, fall under the jurisdiction of our local code. If the City were to follow San Diego's lead and modify its municipal code, contractors bidding projects which did not require the payment of prevailing wages could bid projects knowing they did not have to pay their employees any more on the public project than they did on private ones. It would also relieve the contractors of the task of reporting wages to the city. (San Diego has no requirement to report wages paid. ) In the eight years following the change San Diego staff reports that there have been very few problems. Of significance, the quality of the work has not decreased and San Diego's staff feel the overall cost of the projects has decreased. PROBLEMS: A change of the requirement to pay prevailing wages may make it more difficult for union contractors to compete for city projects. A review of the list of bidders of recent city projects reveals that only 12 of 47 contractors submitting bids are union contractors. The experience in San Diego was that the number of union contractors decreased. FISCAL IMPACT: Engineering staff has discussed with several local contractors the possible savings a change such as we are considering might cause. Staff believes that the city could potentially save 20-25 percent of the cost of applicable projects, although the savings will be not be known until we have some experience with the new process. RECOMMENDATION: Based upon the information reviewed and provided to the task force, the task force recommends the adoption of ordinances necessary to modify the Municipal Code to remove the requirement for contractors to pay "Prevailing Wage" on local projects. We believe this will save the City money and will produce project costs more similar to those obtained by the private sector. c: Jeff Jorgensen John Moss Ann Slate John Hawley g/wagerep.mem 12 MEMORANDUM March 2, 1993 TO: John Dunn, City Administrative Officer FROM: Ann Slate, Personnel Directoro SUBJECT: TASK FORCE REPORT--EMPLOYEE WORKING GROUP The Employee Working Group is the original task force formally created by the City Council on June 30, 1992 as part of an overall budget action plan. The group's charge was to develop expenditure reduction ideas, with a special emphasis on personnel cost savings and employee retention. On November 10, 1992, the .City Council reviewed the ideas of the Employee Working Group which had been presented to them as part of the implementation of an action plan for fiscal health. Those ideas taken to Council in November are attached. Since that time, the Working Group has met to discuss and provide input into the process the City has been following to prepare cost cutting and revenue generating recommendations that will be presented to the Council on March 13, 1993. The group has been one of the methods City staff has used to communicate to employees. Since the Working Group is composed of the presidents of each employee association and all departmental fiscal officers, information and perspectives have been shared from both departmental and association points of view. While the group recognizes that many of the ideas presented are mandatory subjects of bargaining, all members have actively participated by clearly defining a variety of the issues that will become more significant when lay-off impacts are formally discussed in meet and confer. Once such issue that the City was able to resolve that had been identified early by the group was the city's lay-off policy and the need to clarify vague language. That was accomplished in January with all employee associations agreeing to specific language that clarified the order of lay-offs. This was a significant issue and was resolved in the collective with relative ease demonstrating the ability of staff and associations to work cooperatively to reach mutually beneficial goals. The Employee Working Group will be meeting again on March 8, 1993 to review the City Administrative Officer's recommendations that will be presented to Council on March 13, 1993 which will include the ideas developed last November. 13 CITY OF SAN LUIS OBISPO LAYOFF PREVENTION PLAN Proposed Steps in Layoff Prevention Plan: 1. Filling vacancies ■ Short term actions: o Initiate hiring freeze o Develop plan (blue print) for "right-sized organization" o Retain flexibility to recognize priorities/extreme situations ■ Long term actions: analyze each vacancy in light of the following options o Eliminate position o Fill with displaced employee ("perfect fit" or "trainable") o Use eligibility list and regular recruitment procedures 2. Voluntary reductions - incentive options Each option listed in this section needs to be evaluated on a case by case basis to ensure that it makes economic sense. ■ 2% at 55 This is an enhanced PERS retirement plan for non-safety employees which allows retirement at an earlier age without negative financial implications to the employee. This option needs to be more fully analyzed. A survey will be conducted to determine how many employees would take advantage of this benefit and where the resulting vacancies would occur. ■ Other PERS incentives There are costs associated with amending our. existing PERS contracts to include incentives for retirement and they would have to be analyzed in light of the voluntary reductions that would result. o Two years additional service credit. (This option is available to employees whose positions are scheduled for layoff. There are some costs associated with changes to our PERS contract.) o Full retirement - Develop packages that encourage full retirements i.e. "Golden Handshakes" o Partial retirement - Develop packages that offer part-time employment prior to the effective date of retirement. ■ Work furlough (education and other) Unpaid leaves of absence that enable employees to pursue educational or other professional development. 14 CITY OF SAN LUIS OBISPO LAYOFF PREVENTION PLAN Page 2 ■ Work hour reduction As an incentive to employees to voluntarily reduce their hours of work, the City's contribution toward health insurance could be paid as if the employee were working full-time for a period of 12 months. After that, Will prorate medical insurance contributions according to percentage of full-time. ■ Job sharing ■ Wage reduction ■ Voluntary demotion/transfer Policies would need to be reviewed and modified to support this option. ■ Resignation Severance packages could be developed for employees who voluntarily resign to avoid being laid off and who are not eligible for retirement. 3. . Reduce temoorary workforce Eliminate selected. or targeted temporary positions only when it makes economic sense rather than a blanket decision to lay off all temporaries. 4. Defer negotiated annual wage adjustment Subject to meet and confer; will vary from bargaining unit to bargaining unit 5. Rollback negotiated wage increases Subject to meet and confer; will vary from bargaining unit to bargaining unit. (No retroactive pay back.) 6. Defer sten increases/performance oav for a limitedi)eriod of time This would provide for a retroactive pay back and is subject to meet and confer; will vary from bargaining unit to bargaining unit. 7. Suspend sten increases (No retroactive pay back) - subject to meet and confer; will vary from bargaining unit to bargaining unit. 15 CITY OF SAN LUIS OBISPO LAYOFF PREVENTION PLAN Page 3 is 8. Wage reduction ■ meet and confer with individual bargaining units to determine percentage of reduction ■ percentage could vary unit to unit 9. Reduce full-time work force ■ Work hour reduction - For example, close City Hall one day per month. Medical insurance to be paid as full-time employee for a period of 12 months. After that, will prorate medical insurance contributions according to percentage of full-time. ■ Work furloughs ■ Layoffs - review return to work provisions Additional suggestions: ■ Explain to employees and public why certain recruitments are proceeding (An explanation appeared in the September employees' newsletter.) ■ Fill vacant positions from within when possible. ■ Initiate retraining program to assist employees to transfer to new City positions. ■ Review Municipal Code language regarding layoffs to clear up vague language. ■ Consider partnership job training with other agencies, if it makes economic sense. , ■ Encourage continuance of support for Economic Stabilization Program to generate more revenues, particularly retail sales tax development. G:Iaypp 16 MEMORANDUM February 24, 1993 TO: John Dunn, City Administrative Officer FROM: William C. Statler, Director of Finance — Chair, Revenue Task Force wzp� SUBJECT: REVENUE TASK FORCE FINDINGS BACKGROUND The Revenue Task Force was assigned the responsibility of identifying potential revenue sources available to the City in mitigating the impacts of the service cuts that might otherwise be required given our projected revenue/expenditure gap in the General Fund of$2.5 million, exclusive of prospective State cuts that might take—away an additional $1.5 million. Task Force members included: W Dave Elliott, Administrative Analyst — Public Works w Sue Baasch,Administrative Analyst — Utilities W Kathy Koop, Principal Recreation Supervisor — Recreation W Linda Asprion, Revenue Manager — Finance 0- Carolyn Dominguez, Accounting Manager — Finance W Bill Statler, Director of Finance (Chair) APPROACH TO THE WORKSCOPE Each member was assigned an group of potential revenues to research. For each source,we have used a consistent question and answer format addressing the following issues: W What is the source? What action is necessary to implement it? W Do we have it now? W How can the proceeds be used? W Who pays it? W Why is it an appropriate source of W Who administers it? revenue? W What is the legal authority for it? W When could it be effective? W What other cities have it? W Are there any special implementation W How much revenue would it generate? issues? To the extent possible,we surveyed a common list of twelve cities that we believe share many characteristics with our city regarding their experience with these revenue sources. W Monterey W Camarillo w Napa W Santa Barbara W Santa Cruz W Visalia W Ventura W Palm Springs w Santa Maria W Davis W Petaluma W San Juan Capistrano 17 SUMMARY OF FINDINGS The Task Force reviewed 20 possible revenue sources organized into four basic categories: . •► Taxes Operating Program Fees •� Development Impact fees W Entrepreneurial Opportunities Potential annual revenues from these sources total over$8 million summarized as follows: Potential New Revenue Sources Annual Revenues First Year Fifth Year Taxes Property transfer tax - set our own rate at$4.40/$1,000 525,000 900,000 Transient occupancy tax - increase rate from 9% to 10% 260,000 260,000 Utility users tax Expand base to sewer and trash 300,000 300,000 Increase rate from 5% to 6% 540,000 540,000 Business tax - increase rate from $50/$100,000 to $60/$100,000 140,000 140,000 Admissions tax - set rate at 6% of admission price 150,000 Franchise tax Expand base to include sewer @ 2% (current water rate) 81,700 81,700 Increase cable rate to 5% 41,000 41,000 Operating Program Fees Police services 30,000 30,000 Fire services Paramedic cost recovery 325,000 Code enforcement services 50,000 50,000 Development review 36,000 36,000 Business inspections 125,000 125,000 Special events 88,000 88,000 Benefit assessments for landscape & lighting 2,100,000 Mello-Roos special taxes varies Recreation activities 100,000 350,000 Capital Improvement Revenues Park in-lieu fees - remove current limit unknown unknown Transportation impact fees - set new fee 100,000 500,000 General facility impact fee - set new fee 100,000 500,000 Local option sales tax - Countywide voter approval @ 1/2 cent 1,600,000 Entrepreneurial Opportunities Annexation of CMC/Cal Poly 600,000 Property management unknown Private/public partnerships unknown TOTAL 2,5169700 897162700 As discussed in the following "fact sheets", there are varying levels of complexity in implementing these revenue alternatives. 18 PROPERTY TRANSFER TAX FACT SHEET What is a property ttmtsfer tax? This is a tax resulting from the transfer of real property ownership based on the value of the property. Is this tar its place at this tune? Yes. Section 11901 of the Revenue and Taxation Code (RTC) establishes a statewide property transfer tax at the rate of$1.10 per $1,000 of value (or $275 on a property with a transfer value of $250,000). Who pays this tax? The person to whom the property is being transferred - the "buyer". Who currently receives the revenue? The County and incorporated cities share equally in the tax revenues - in essence, each has its own rate equal to $0.55 per $1,000. In the unincorporated areas, the County receives all transfer revenues at the $1.10 per $1,000 rate. Can cities increase their tax rate? Yes. Cities are allowed to set their own rate separately from the provisions of RTC Section 11901. In this case, the County would retain the entire proceeds from the $1.10 rate specified in this section. Have any other cities adopted their own property transfer taxes? Yes. At least 22 cities in 10 counties have adopted their own property transfer tax rates. Rates range from $1.15 per $1,000 in Petaluma. to $10.00 per $1,000 in Berkeley. How much revenue would an utcrme generate? This depends on two key factors: ■ The value of property transferred annually. ■ The tax rate established by the City. For comparison purposes, the following is a summary of property transfer tax revenues received by the City over the past four years at the current rate of$0.55 per $1,000, and the amount that would have been received at rates ranging from $2.20 per $1,000 to $10.00 per $1,000. Actual Revenues @ Revenues @ Revenues @ Revenues @ Revenues @ Revenues $2.20/$1,000 $330/$1,000 $4.40/$1,000 $5.00/$1,000 $10.00/$1,000 1991-92 $ 68,400 $ 273,600 $ 410,400 $ 547,200 $ 621,800 $1,243,600 1990-91 94,300 377,200 565,800 758,200 864,350 1,728,700 1989-90 137,800 551,200 826,800 1,102,800 1,252,700 2,505,400 1988-89 136,700 546,800 820,200 1,093,600 1,242,700 2,485,400 19 What authority is required to increase this tax for the City? If the revenues will be used for general purposes, Council approval is required. If the revenues will be used for a special purpose, two-thirds voter approval is required. How can these reveruues be used? These revenues can be used for any legitimate government purpose - street maintenance, parks, recreation, police, or fire. They can be formally earmarked;however, as noted above, this would require two-thirds voter approval. If designating the use of these revenues is desirable, the Council could allocate them by policy to a special purpose such as parks and open space. For example, the 1991-93 Financial Plan includes several policies regarding the allocation of General Fund revenues. However,the implementing ordinance itself could not earmark them without two-thirds voter approval. Why is this an appropriate City funding source? The City's real property transfer tax will be paid by the buyers of San Luis Obispo properties. As such, it is an appropriate way for new residents to pay their fair share of the amenities that have already been provided by existing residents. For properties changing hands through local buyers, the transfer tax reflects the enhancement of property values by the facilities and programs that the City provides. How would these revenues be collected? The County could continue to collect these revenues for us. Although this would require a formal agreement with the County, initial discussions with them have been favorable. When could an iivaease be effective? Theoretically, an increase could be implemented immediately upon Council approval. However, an effective date that is 120 to 180 days from the date of adoption is recommended in order to ensure a smooth transition for the County, businesses directly involved in processing property transfers such as escrow, title and lending companies, and any individuals or companies with properties currently in escrow. Are there any other implementation issues? Yes. There has recently been a court case against the City of Los Angeles for increasing the city property transfer tax. The court decided in favor of the City of Los Angeles so they have retained this tax. However, it is anticipated that the decision will appealed to a higher court. For this reason, the City may want to delay implementation of the property transfer tax until an appellate court ruling has been issued. 20 TRANSIENT OCCUPANCY TAX FACT SHEET What is tra►tQerrt occupancy tar. This is a tax on the rental of a hotel/motel room based on the price of the room. Is this tar in place at this tine? Yes. The transient occupancy tax (TOT) rate is currently 9% and provides the City approximately $2.3 million dollars annually. Who pays this tar? This tax is paid by visitors to our community; it is not paid by local residents or businesses. Who currently receives the revenue? The revenue goes directly into the City's General Fund and is used for General Fund purposes. The 1991-93 Financial Plan policies allocate 20% of TOT revenues for community promotion, cultural activities, and economic stability purposes. Can cities increase their tax rate? Yes. Cities can change the transient occupancy tax rate by adopting an ordinance increasing the tax rate. No other authority is required to increase this tax. How much revenue would an increase generate? For each percent increase, General Fund revenue will increase approximately $260,000. How does the City's irmcsiernt occupancy, tax rate compare with other doer? Based upon a survey of the cities chosen for comparison, the following transient occupancy tax rates are in effect: San Luis Obispo 9% Monterey 10% Camarillo 9% Napa 10.5% Santa Barbara 10% Santa Cruz 10% Visalia 8% Ventura •10% Palm Springs 10% Santa Maria 10% Davis 10% Petaluma 10% San Juan Capistrano 10% Rates in other San Luis Obispo County areas are: Pismo Beach 10% Atascadero 9% Morro Bay 9% Paso Robles 9% Grover Beach 10% Arroyo Grande 6% San Luis Obispo County 9% 21 How can these revenues be used? These revenues are General Fund revenues and can be used for any legitimate government purpose - parks, street maintenance, recreation, police, or fire. Why is this an appropriate City funding source? Placing this tax on the City's visitors appropriately recognizes that they receive municipal services during their stay, and as such, they should share in the cost of providing them. When could an iiu7ease be effective? Theoretically, an increase could be implemented immediately upon Council approval. However, an effective date that is 90 to 120 days from the date of adoption is recommended in order to ensure a smooth transition for the hotels and motels as they quote prices to tour companies for future bookings. 22 UTILITY USERS TAX FACT SHEET Mat is utility users tar? This is a tax on the consumption of utility services (i.e. gas, electricity, water, telephone, cable, etc.) similar to a sales tax on commodities. Is this tar in place at this time? Yes. The tax rate is currently 5% and provides the City approximately $2.7 million dollars annually. Do all utility companies charge utility users tar? No. Two utilities, garbage and sewer, do not include utility users tax on their billings. When the original utility users tax ordinance was adopted, the City was billing for three utilities - water, garbage, and sewer - and only water was included with the other utilities to be taxed. Who pays this tar? The individual or business using the utility pays the tax at the time the utility bill is paid. Who currently receives the revenue? The revenue is remitted monthly to the City by each of the utility companies collecting the tax. The revenue goes directly into the City's General Fund and is used for any legitimate government purpose - police, fire, recreation, street maintenance, parks. Can cities vncnease their tar rate? Yes. Cities can change the utility users tax rate by adopting an ordinance increasing the tax rate. No other authority is required to increase this tax. How much revenue would a rate increase generate? For each percent increase in the utility users tax, General Fund revenue will increase approximately $540,000. Can the City erpand the utility users tar base to include all utilities? Yes. Cities can expand the utility users tax base to include all utilities, which in our case would add the two utilities currently not charging the tax - garbage and sewer. To include these two utilities, the City needs to adopt an ordinance indicating the inclusion of garbage and sewer. No other authority is required. How much revenue would be generated by expanding the utility users tax base? By adding the two remaining utilities - garbage and sewer - approximately $300,000 annual revenue would be generated for the General Fund. i 23 How does the City's utility users tax rate compare with other cities? Based upon a survey of the cities chosen for comparison, the following utility user tax rates are in effect: San Luis Obispo 5% Monterey 5% Camarillo none ' Napa none Santa Barbara 6% Santa Cruz 7% Visalia none Ventura 5% Palm Springs none Santa Maria none Davis none Petaluma none San Juan Capistrano none Statewide, 127 cities have established a utility user tax ranging from 3.5% to 12.5%. Although a majority of cities do not have a utility users tax, an overwhelming majority of State residents (approximately 60%) are covered by the tax. Why is this an appropriate City funding source? Utility users tax is an established means of generating general fund revenue. Most people. in the State pay utility users tax. When could a rate vrcrease acrd/or expansion of the tax base be effective? Theoretically, an increase and inclusion of garbage and sewer in the tax base could be implemented immediately upon Council Approval. However, an effective date that is 60 to 90 days from the date of adoption is recommended in order to allow enough lead time for notification to all utility companies and to allow them time to make any program or billing changes required. 24 BUSINESS TAX FACT SHEET What is a busvrecs tax. This is a tax on businesses operating within the City to raise revenues for general municipal purposes - it is not intended to be regulatory. Is this tax in place at this time? Yes. The tax rate is currently $ SO per thousand dollars of gross receipts with a minimum tax of $25.00. Who pays this tax? Any person or company conducting business in the City is required to pay a business tax. Business activities include rentals, services, manufacturing, and sales. This includes individuals and companies that may not have a fixed place of business in the City. Are there any exemptions? Very few: ■ Minors under the age of 18 years old. ■ Bonified non-profit organizations. ■ Business types where the payment of local business taxes conflicts with the applicable statues or constitution of the United States or the State of California. Who currently receives the revenue? The revenue comes directly to the City's General Fund and is used for any legitimate government purpose - police, fire, street�maintenance, recreation, parks. Can the City increase the tax rate? Yes. The City can change the tax rate by adopting an ordinance increasing the tax rate. No other authority is required to increase this tax. How much revenue would a rate increase generate? For each 10 cent increase per thousand dollars of gross receipts, the General Fund revenue will increase approximately $160,000. How does the City's business tax rate compare with other cities? Comparing business tax rates is more difficult as there are several different basis for charging business tax (gross receipts, flat fees, square footage, number of employees, etc.). Both the basis for charging business tax and the business tax revenue for 1991-92 are listed below. 25 Percent Basis for Revenue for General Fund Business Tax 1991-92 Revenues San Luis Obispo Gross Receipts $ 6069000* 2.970/c Monterey Gross Receipts $1,530,000 5.69% Napa Gross Receipts $ 970,000 4.05% Santa Cruz Flat Fee + employees $ 647,000 1.85% Ventura Gross Receipts $1,000,000 1.52% Santa Maria Flat Fee $ 230,700 .74% Petaluma Flat Fee $ 280,000 1.73% Camarillo Gross Receipts $ 584,300 2.69% Santa Barbara Gross Receipts $1,236,000 1.91% Visalia Gross Receipts $ 680,000 2.41% Palm Springs Flat Fee $ 600,000 2.14% Davis Gross Receipts $ 600,000 3.34% San Juan Capistrano Flat Fee $ 152,900 .94% *Excludes Business Improvement Association surcharges Why is this an appropriate City funding source? Placing this tax on the City's businesses appropriately recognizes that they receive municipal services, and as such, they should share in the cost of providing them. When could an bzaease be effective? Theoretically, an increase could be implemented immediately upon Council approval. However, an effective date that is 30 to 60 days from the date of adoption is recommended to allow enough lead time to make the internal administrative and computer changes required. 26 ADMISSIONS TAX FACT SHEET What is an admissions tar? This tax is levied on the privilege of attending theaters, concerts, movies, sporting events, museums, and other performances. The tax is a flat rate, a percentage of the ticket value, or a sliding rate depending on the cost of the ticket. Is this tax in place at this tbne? No, the City does not currently charge an admission tax. Who pays this tax? The patrons of events at held theaters, auditoriums, or sporting arenas. How can cities assess this tax? An admissions tax would require a majority vote of the Council as long as the proceeds are levied for general purposes and deposited in the City's General Fund. Have other cities adopted this tax? Yes, this tax is most beneficial to cities with a large stadium, sports arena, or auditorium. Of the twelve cities in our survey, only the City of Santa Cruz has an admissions tax in effect. The 5% fee generates $1.05 million in additional revenues. At least fourteen other California cities have implemented an admissions tax. How much revenue would this tax generate? Currently the City would only be able to levy this tax on the theaters, however, if the City were to annex the Cal Poly campus, sporting and cultural events occurring there would also be subject to this tax. Additional research would be required to develop a firm projection, but based on revenues from other cities, up to $150,000 annually could be generated. What authority is required to assess this tar? The City Charter grants the authority to Council to levy this fee if the proceeds are used for a general purpose. How can these revenues be used? These revenues can be used for any legitimate government purpose - parks, recreation, street maintenance, police, or fire. However, if the revenue is earmarked for a specific purpose, then two-thirds approval of the voting public is required. Why is this an appropriate City funding source? General Fund resources are used for public safety to protect participants at events, to provide safe highways for those attending events, and to provide a pleasant atmosphere to entice participants to come to San Luis to attend various events. To perpetuate attendance at various local activities, this is an appropriate revenue source. 27 How would these revenues be collected? The sponsors of events would collect this fee along with the price of admission, and then remit the City's portion on a monthly or quarterly basis. When could the assessment be effective? Theoretically, this fee could be implemented immediately upon Council approval. Practically, however, coordination with the sponsors of events being subject to the tax would require 120 to 180 days to establish the implementation of a reporting system and collection procedures. What are the negative impacts of implementing this tax? This tax will not be favored by the owners/operators of entertainment facilities. Imposition of the tax will increase their recordkeeping responsibilities. The tax and the additional operating costs will be passed along to the general public in increased ticket prices. A more fundamental issue is the constitutionality of imposing an admissions tax when the fee would be currently limited to theater operations. The admissions tax in the City of Montclair was recently found unconstitutional because the burden of the tax fell disproportionately upon business engaged in protected speech - the theaters. Until San Luis Obispo has a variety of entertainment facilities on which to impose the tax, an admissions tax is not a viable revenue source. a:\admtu 28 PUBLIC UTILITY FRANCHISE TAXES FACT SHEET What are franchise taxes on public utilities? These are taxes levied on public utilities franchisees (such as power, communications, water, wastewater, and solid waste enterprises) for use of City right of way and infrastructure in their operations. Does the City levy these taxes now? Yes. The City levies various franchise taxes on all public utilities operating within the City except Pacific Bell and the City's wastewater enterprise. Who pays these taxes and how much did they pay in 1991/92? PG&E ($111,120), Southern California Gas Company ($92,620), Sonic Cable Television ($165,190), San Luis Garbage Company ($183,340), Unocal Oil Distribution ($5,860), and the City's water enterprise ($105,420). Total revenue from franchise taxes was $663,550 in 1991/92. Who administers these taxes? These taxes are included as provisions of the franchises granted to various public utilities so they can operate within the City. State law specifies the franchise tax rates for gas and electricity companies. All other franchise tax rates are negotiable. What other cities have these taxes and what rates do they charge? All cities collect fixed franchise taxes for electric and gas utilities. A survey of 12 similiarly situated cities showed the following extent of franchise taxes and the rates levied: Waste- Solid Cable Water water Waste TV Camarillo none none 5% 3% Davis 1% 1% none 5% Monterey none none 10% 5% Napa none none 5% 5% Palm Springs none 1% 17% 5% Petaluma none none 10% 5% San Juan Capistrano none 5% 5% 5% Santa Barbara none 2% 5% 5% Santa Cruz 5% 5% 5% 5% Santa Maria none none none 6% Ventura none none none 5% Visalia none none none 5% 29 What is the legal authority for these taxes? The state constitution confers this authority upon cities. How much additional revenue could the City realize by establishing or increasing these taxes? +1% +2% +3% increase increase increase San Luis Garbage Company (now 6%) $ 30,600 $ 61,100 $ 91,700 Sonic Cable Television (now 4%) 41,300 82,600 123,900 City Water Enterprise (now 2%) 52,700 105,400 158,100 City Wastewater Enterprise (new) 40.800 81.700 122.500 Totals $165,400 $330,800 $496,200 What action is necessary to increase these taxes? Raising franchise tax requires changing the ordinance which grants the franchise. Theoreti- cally, the City could adopt a new ordinance at any time, but it makes sense to do it in conjunction with a rate adjustment, because the tax would passed through to the franchisee's customers. How can these taxes be used? These taxes can be used for any legitimate government purpose. The City currently allocates them as unrestricted revenue to the general fund. Why are franchise tax increases appropriate? Public utilities generally locate their service lines or operate their equipment within the City's street right of way. Franchise taxes account for the value of operating on City property or causing additional wear and tear to City streets. When could these increases take effect? They should be timed to coincide with planned rate adjustments. Negotiations are currently underway with Sonic Cable TV. Review of a regularly scheduled rate adjustment for San Luis Garbage will begin in March 1993. 30 POLICE USER FEE FACT SHEET What are police user fees? Those services provided by the City Police Department which exceed minimum public safety services are charged fees appropriate to the cost of delivering the service. Examples of these fees include issuing permits and licenses for alarms, concealed weapons, massage technicians or parlors; seeldng reimbursement for costs related to special events, DUI accidents, responding to false alarms, towing abandoned autos; and charging for services such as reproduction of reports, fingerprinting, duplication of photographs. Are these fees in place at this time? For the most part. Resolution No. 5366 (1983 series) established fees and charges for reproducing documents, fingerprinting and similar services provided by the Police Department. Charges identified in this resolution have not been modified since 1983. The Police Department is currently not collecting for costs associated with administration of towing companies rotation, returning recovered property, reviewing and issuing alcoholic beverage commission permits, record sealing, releasing stored vehicles, or DUI incidents not involving traffic accidents. Who pays these fees? The person requesting the service or malting the choice to become involved in action requiring police response pays the fees. Who collects these fees? The City, either through the Police or Finance Departments. These revenues become part of the City's General Fund. What is the legal authority to collect these fees? State Law and the City Charter. Have other cities adopted these fees? Of the 12 survey cities listed below, all have adopted some level of charges for services such as providing records, fingerprinting and responding to false alarms. Most have some type of cost recovery program for DUI accidents. The cities of San Juan Capistrano and Camarillo contract for police services. Annual Percent Annual Percent Revenues Gen Fun Revenues Gen Fund Camarillo N/A N/A San Juan Capistrano 15,000 .14% Davis 19,000 .10% Santa Barbara 140,400 .26% Monterey 197,650 .74% Santa Cruz 53,100 .18% Napa 559000 .23% Santa Maria 319000 .12% • Palm Springs 103,000 .31% Ventura not avail. not avail. Petaluma 55,500 .33% Visalia not avail. not avail. 31 How much revenue would an increase generate? An increase to existing fees could generate as much as $20,000 annually, based on a cost of living increase to the existing fees. If fees were established for services currently not billed, an estimated additional $8,000 to $10,000 might be generated by charging for release of stored vehicles, permit review, development review, processing/release of recovered property and records sealing. This does not include an expanded or aggressive DUI incident/emergency cost recovery program, as this is pending a legal opinion. What action is necessary? To update the existing fees as well as to identify charges for other services, Council would need to adopt a Resolution, following a public hearing. Why is this an appropriate City funding source? These revenues can be used to directly offset expenses incurred in the delivery of the identified service. While the cost of providing these services has increased, the charges have not been increased since 1983. These charges are consistent with the City's user fee policy, which states that the driver of a service should pay the cost of that service. When could an increase be effective? An increase could become effective this year, following Police determination of appropriate charges and Council adoption of a new schedule of fees. Are there any special implementation issues? Staff has some concern about the possibility of higher non-compliance with permitting and licensing requirements when fees are increased. 32 EMERGENCY MEDICAL SERVICE FEES FACT SHEET What are emergency medical service fees? Emergency medical service fees are charges for the Fire Department's response to calls requiring medical services. These calls are divided into two categories, those requiring basic life support(BIS) and those requiring advanced life support (AIS). Advanced life support goes beyond basic life support response in that it requires specialized medical training and treatment exceeding the basic firefighter EMT-1 level. Advanced life support treatment is known as "paramedic" service. The City Fire Department responds to an average of 2,500 calls per year, of which 1,415 require medical aid. Of the 1,415 calls requiring medical aid, approximately 60% are for advanced life support and require paramedic training. At least one paramedic responds to every AIS call. The Fire Department currently has 13 paramedics. Transportation to the hospital is not included in the services presently provided by the Fire Department. Does the City Flue Department charge for providing these services? Not at this time. All Fire Departments are required to provide basic life support services, and to the best of staff's knowledge, do not charge for those services. However, Fire Departments providing paramedic services usually do charge for those services. If the City elects to charge for these services, who would pay the fees? Payment could come from any of four sources. Since the private ambulance service currently bills for all emergency response and transportation, the City, or its agent, could bill the ambulance service, the individual receiving medical assistance, the individual's health provider, or the involved hospital. This would be a point of negotiation between the City, the County, the private ambulance service and local hospitals. Some cities have implemented a "subscription" service which functions like an insurance policy. Who would collect these fees? There are a wide variety of possible collection methods, including in-house billing by Finance, contracting with local hospitals or specialty collection firms. The cities of Petaluma and Cathedral City dedicate one staff person who spends approximately 60% of their time in billing and collecting for these services. What is the legal authority to collect these fees? While it is a legal requirement for Fire Departments to provide basic life support, it is not required that the Fire Department provide advanced life support. Because we do, however, the ambulance service is relieved of that requirement, and actually bills and collects for the services provided by the City Fire Department. Have other cities adopted these fees? Of the twelve survey cities listed below, only three provide paramedic services, the Cities of Napa, Petaluma and San Juan Capistrano. San Juan Capistrano contracts with the Orange County Fire Protection District for fire services. An override to the property tax funds the paramedic services in Napa and San Juan Capistrano. Petaluma has established an ambulance • enterprise fund and estimates that the average charge for services is $800. 33 Est. Cost Est Revenue Est. Cost Est, Revenue Camarillo N/A N/A San Juan Capistranc$600,000 $460,000 Davis N/A N/A Santa Barbara N/A N/A Monterey N/A N/A Santa Cruz N/A N/A Napa $600,000 $4609000 Santa Maria N/A N/A Palm Springs N/A N/A Ventura N/A N/A Petaluma $851,000 *$897,000 Visalia N/A N/A *This would be reduced by a 50% cost recovery factor, according to Petaluma city staff. How much revenue would fee establishment generate? The Vertex study estimated that the City spends up to $325,000 (the original figure has been adjusted for inflation) to provide emergency medical response. The Vertex study concluded that 50% might be a reasonable recovery rate. Adjusted for inflation and a 50% cost recovery rate, total revenues from this program could be estimated at $162,500. A 60% recovery rate would yield $195,000 in revenue. However, recent experience has shown that use of specialty collection agencies can yield much higher collection rates. If the Department were to provide a transportation service in addition to the pre-hospital care already provided, even greater revenues might be generated, as much as $600,000. This estimate is based on 1,400 calls per year multiplied times an estimated $700 per call and projecting a 60% recovery rate. What action is necessary? To establish fees for these services, Council would need to adopt a Resolution, following public hearing. Voter approval would not be required. Why is this an appropriate source of revenue? It is consistent with the user fee policy, as fire departments are not required to provide emergency medical response beyond basic life support. Charges would allow reasonable cost recovery for a non-mandated community service program. Also, in many cases, patients would experience no increase in medical costs, as they are already being billed for these services by the ambulance company. How can these revenues be used? These revenues can be used to offset actual expenses incurred in providing emergency medical support services. When could an increase be effective? A fee schedule such as the one proposed could not be implemented until the County and the cities reach resolution on the issue of ambulance contracts. Negotiations are in process now. 34 UNIFORM FIRE CODE SERVICES FEES FACT SHEET i What are fees related to Uniform Fire Code requirements? The City Fire Department is responsible for administering the requirements of the Uniform Fire Code. This includes regulating hazardous occupancies, administering the State's requirements for hazardous materials users business plans, and maintaining an inventory of hazardous materials within the City. The City currently has a number of fees relating to the type of hazardous occupancy and the type and amount of hazardous materials at each location. Are these fees in place at this time? Yes. Resolution No. 6139 (1986 series) was the last resolution adopted adding new items to these fees. Most of the fees have not been increased since 1984. Who pays these fees? Person or organizations requesting approval of regulated occupancies and businesses who handle or use hazardous materials. Who collects these fees? The Fire Department bills and collect these fees. They become revenue to the General Fund. What is the legal authority to collect these fees? Article 4 of the Uniform Fire Code and Section 25500, et. seq., of the State Health and Safety Code, allows cities to implement fees for cost recovery of these requirements. Have other cities adopted these fees? Of the 12 survey cities, all but two (Santa Maria and Visalia) have adopted or are adopting Uniform Fire Code fees in some form. The City of Camarillo contracts for fire and police services and does not collect any related service charges. Annual Percent Annual Percent Revenues Gen Fund Revenues Gen Fund Camarillo N/A N/A San Juan Capistrano -0- -0- Davis 6,600 .04% Santa Barbara *50,000 .09% Monterey 30,000 .11% Santa Cruz *77,000 .26% Napa 11,000 .05% Santa Maria -0- -0- Palm Springs -0- -0- Ventura not avail. not avail. Petaluma 10,000 .06% Visalia not avail. not avail. *Charges for various fire services are not separated into categories. This represents the estimate for all fire service-related revenues. 35 How much revenue would establishing these fees generate? In fiscal year 1991/92, fire service fees generated $55,000 in general fund revenue. If the fees were increased by the amount of change in the cost of living since the fees were adopted, a factor of 1.48, the additional revenue would be $26,400. Most of the surveyed cities have set fees in this area at a level which would be higher than a cost-of-living adjustment to our current rates. What action is necessary? To update existing charges, Council would need to adopt a Resolution, following public hearing. Why is this an appropriate City funding source? These revenues can be used to offset expenses incurred in the implementation of a State- mandated program to regulate specific business plans for emergency response to a release or threatened release of hazardous materials. The City has a mandate to provide these services and the cost of providing these services has increased. Charges for these services have not been increased since 1984. How are these revenues collected? The revenues are billed and collected by the Fire Department and forwarded to the Finance Department. When could an increase be effective? An increase could become effective this year, following Fire Department determination of appropriate charges and Council adoption of a new schedule of fees. Are there any special implementation issues? The business community can be expected to resist charges that increase their cost of doing business, especially in the current economic climate. 36 FIRE PLAN CHECK FEES FACT SHEET What are fire plan check and inspection fees? The City Fire Prevention Bureau is responsible for plan checking and inspecting proposed fire protection systems in new and existing construction as well as inspecting state-licensed facilities. Are these fees in place at this time? No. Who pays these fees? The person or organization requesting the inspection or building permit, which typically is the structure's owner or representative. Who collects these fees? If fees were to be adopted for plan check, the Building Department could collect a surcharge for for fire protection as part of the building permit. Currently, the City collects such surcharges for energy and handicapped regulation. For those requests for special inspection directed to the Fire Department, the Fire Department could bill and collect. What is the legal authority to collect these fees? The Uniform Building Code, Section 304(8),pursuant to State Health and Safety Code Section(s) 13146.2, 1597.46, and 13235. Have other cities adopted these fees? Of the 12 survey cities, only one (Petaluma) has not adopted fees for these services. The cities of Davis and Napa charge 25% of the building permit for these services. The City of Santa Maria charges 5% of the building permit currently, but will be evaluating this charge in July. Annual Percent Annual Percent Revenues Gen Fund Revenues Gen Fund Camarillo N/A N/A San Juan Capistrano -0- -0- Davis 172400 .09% Santa Barbara *50,000 .09% Monterey not avail. not avail. Santa Cruz *77,000 .26% Napa 101,000 .42% Santa Maria not avail. not avail. Palm Springs 25,000 .07% Ventura not avail. not avail. Petaluma -0- -0- Visalia not avail. not avail. *Charges for various fire services are not separated into categories. This represents the estimate for all fire service-related revenues. 37 How much revenue would an increase generate? If the City Council elects to include charges for fire plan check and inspection, it could set a two-tiered surcharge for residential and commercial applicants, reflecting the difference in time required for the services. It is estimated that the average of the two tiered structure, if similar to the energy surcharge, would be about 12%. Based on an "average" year of building permit activity ($300,000 annually), this would yield about $36,000 in additional revenue. The Fire Department estimates that establishing charges for institutional inspections in accordance with State guidelines would yield approximately $1,000 a year in additional revenue. What action is necessary? To establish fees for these services, Council would need to adopt a Resolution, following public hearing. How can these revenues be used? These revenues can be used to offset actual expenses incurred in providing fire plan check and inspection services. Why is this an appropriate City funding source? Implementing these charges is consistent with the City's user fee policy, which states that the driver of a service should pay the cost of that service. When could an increase be effective? An increase could become effective this year, following Fire and Building Department determination of appropriate charges and Council adoption of a new schedule of fees. Are there any special implementation issues? In determining an appropriate percentage of surcharge, staff will evaluate the cost to provide the service as well as the appropriateness of the fee with the intent of insuring that permits are secured by all who engage in regulated building activity. 38 FIRE SAFETY INSPECTION SERVICES FEES FACT SHEET What are fire sqfety inspection fees? These fees would recover costs associated with the routine Fire Department inspections of various types of businessess and establishments open to the public. Fire inspections involve both the engine companies and the prevention bureau, and are performed on an eighteen month schedule. The Department estimates that a total of 2,556 manhours were spent in the last year making 3,047 such inspections. Are these fees in place at this time? No. Who would pay these fees? The businesses and establishments which are inspected would pay the fees. Who collects these fees? The Fire Department could bill and collect these fees. They would become revenue to the General Fund. What is the legal authority to collect these fees? Precedent exists to have a fee for an inspection process which is not specifically indicated in the code, reference item A.11. of the Building and Safety Fee Schedule of the Uniform Administrative Code. It states that inspections for which no fee is specifically indicated can be charged a minimum charge of 1/2 hour. The current hourly rate is established at $52/hour. Have other cities adopted these fees? Of the 12 survey cities, only one, the City of Davis, reported revenue from fire safety inspections. The Davis Fire Department explained in a July 1992 memorandum to the City Manager that such charges are not wide spread, though there is a trend in this direction. That memorandum identified Berkeley and Oakland as cities which have adopted such fees. Annual Percent Annual Percent Revenues Gen Fund Revenues Gen Fund Camarillo N/A N/A San Juan Capistrano -0- -0- Davis 33,850 .20% Santa Barbara -0- -0- Monterey -0- -0- Santa Cruz -0- -0- Napa -0- -0- Santa Maria -0- -0- Palm Springs -0- -0- Ventura not avail. not avail. Petaluma -0- -0- Visalia not avail. not avail. How much revenue would establishing these fees generate? The Vertex study estimated that the city spent up to $93,461 to provide inspections services. Some of the inspection services included in this amount have been identified in other fire service fee areas, such as special institutional inspections which were grouped with the Fire Plan Check fees. For business inspections alone, the Vertex study identified costs of up to $60,000. 39 (Neither of these figures have been adjusted for inflation.) What action is necessary? ry To establish charges for safety inspections, Council would need to adopt a Resolution, following public hearing. Is this an appropriate City funding source? Prior to implementing these type of charges, staff would solicit a legal opinion regarding any conditions relating to these charges. How could these revenues collected? The revenues could be billed and collected by the Fire Department and forwarded to the Finance Department. When could an increase be effective? An increase could become effective this year, following Fire Department determination of appropriate charges and Council adoption of a new schedule of fees. Are there any special implementation issues? The business community can be expected to resist charges that increase their cost of doing business, especially in the current economic climate. 40 SPECIAL EVENT COST RECOVERY FACT SHEET What is a special event? Any public or private gathering, activity, or assembly requiring the use of City owned/controlled property or resources or requiring the closure or disruption of public roads, streets,rights of way, buildings, or park lands, including activities co-sponsored by the City. Why special event cost recovery? The City incurs both direct and indirect costs related to special events. It is the City's policy to charge "user fees" for services which are of special benefit to easily identified individuals or groups. In 1991 the estimated costs of special events were $67,000 for direct and $21,000 for administrative costs. Overhead costs have not been allocated. Is this fee in place at this time? The City currently charges some minimal fees for certain costs of special events, but not with cost recovery as the goal. How can cities arse& urc ease this fee? The City Council can adopt a resolution adopting a fee schedule for special events,with cost recovery as the goal. Have other cities adopted cost recovery fees for special events? Of the cities surveyed, most have adopted some type of fee for special events. The methods used vary from full cost recovery (including overhead) in Ventura and Palm Springs, to flat fees of $250 in Santa Barbara and $30 in Napa. Most cities do not monitor the revenues generated from special event fees, Palm Springs receives $20,000 and Santa Maria $10,000. How much revenue would these fees generate? Based on the 1991 analysis, the potential for recovering $88,000 in direct and administrative costs for that year eidsted,depending on the level of cost recovery approved by Council. One option is to charge something less than full cost recovery, but more than the minimal $8,300 collected in 1991. How can these revenues be used? Special event cost recovery fees should be restored to the General Fund to cover the cost of the service delivered. How would these revenues be collected? A fee schedule would be established by type of special event. When an event application is completed, the applicant would make a payment pursuant to the schedule. When could the assessment be effective? Once the Council adopts the fee policy, it could become effective. Before adoption however, • communication with community groups significantly affected by this change should occur. 41 i What are the negative vnpacts of vnplementiV.LWfee? The number of special events may decrease because some smaller groups may not be able to sponsor an event is a fee is charged. Sponsors of larger events will be'.unhappy with.the fee. schedule if full cost recovery is the goal apd their fees are significantly: increased. aAspecmt 42 LANDSCAPE AND LIGHTING ASSESSMENTS FACT SHEET What are assessments for landscape and lighting? They are charges levied on property owners for the benefits of having trees, street landscap- ing, street lights, traffic signals, parks and recreation facilities in the community. Does the City levy these assessments now? No. Who would pay these assessments? The owners of property within established assessment districts. Who would administer these assessments? The City would establish assessment districts and the formulas for apportioning assessments. The City would also annually adjust assessments and add new properties to districts. Assessments would be included on the County assessment roll and collected by the County for the City. What other cities have this (rind of assessment? A survey of 12 similarly situated cities provided the following responses: Landscape and Lighting Districts? Amount Collected? Camarillo Yes $190009000 Davis Yes $1,100,000 Monterey No Napa Yes $3909000 Palm Springs No Petaluma Yes $71,000 San Juan Capistrano No Santa Barbara No Santa Cruz No Santa Maria Yes $75,000 Ventura Yes $845,000 Visalia Yes $230,000 • 43 What is the legal authorityfor these assessments? The Landscaping and Lighting Act of 1972, as amended, authorizes cities to set up these assessments. As a charter city, the City could form assessment districts under its own unique proceedings. How much could the City realize from these assessments? Under a basic application of the enabling legislation, the City could recover all of its current capital improvement and operating program costs for traffic signals, street lights, trees, and other street landscape improvements. Additional revenue would total about $740,000 per year- Under an expanded application, the City could recover all of its current capital improvement and operating costs for traffic signals, street lights, trees, street landscape improvements, parks (including open space), and recreation facilities. Additional revenue would total about $2,100,000. What action is necessary to levy these assessments? To start the assessment proceedings, the City must prepare an engineering report which includes a description of the work to be accomplished in the following fiscal year, an estimate of the costs for this work, a diagram of the assessment district, and an apportion- ment of the estimated costs among specific parcels withing the district. The Council then must adopt a resolution of intention to establish the assessment district and levy assessments and to announce a public hearing. After conducting the public hearing, the Council must determine if there is majority protest, where property owners owning together more than 50 percent of the property within the district have filed written protests. If there is no majority protest, then the Council may adopt a resolution forming the district and levying the assessment. Each fiscal year, this procedure must be repeated. How can assessments for landscape and lighting be used? These assessments can cover any costs of acquiring, installing and maintaining trees, landscaping, statuary, fountains, ornamental structures, street lights, traffic signals, parks, recreation improvements, or open space. Why are landscape and lighting assessments appropriate? The improvements which are covered by these assessments are a large part of what makes the City an attractive place to live and conduct business. Many also fall into the category of "community enrichment" improvements, which should perhaps be appropriately financed from sources outside of the City's basic general fund tax revenues. Such financing would serve two purposes: 1) protecting these improvements from competing with other more basic services and 2) providing additional revenue to more quickly enhance important improve- ments like tree planting. 44 When could these assessments take effect? These assessments must be scheduled to start with a new fiscal year. Because initially establishing a district is relatively time-consuming, the earliest that the City could realistical- ly begin receiving these revenues would be in fiscal year 1994/95. Are there any special implementation issues? The cost of maintenance or capital improvement for trees, landscaping, street lights and traffic signals (but not parks, recreation improvements, or open space) may be assessed in installments spread out over a period up to five years. The cost of capital improvement (but not maintenance) for any eligible purpose (trees, landscaping, statuary, fountains, ornamental structures, street lights, traffic signals, parks, recreation improvements, or open space) may be assessed in installments spread out over a period up to 30 years. 45 MELLO-ROOS SPECIAL TAXES FACT SHEET What are M ? Mello-Roos special taxes. They are special property taxes that a local governments may impose on specific areas called community facilities districts (CFDs). These taxes must be approved by two-thirds of the qualified electors within a CFD. Does the City impose these taxes now? No. Who would pay this tax? The owners of property within established CFDs. Who would administer this tax? The City would have to initially establish the CFDs and the structure of the tax. The tax could be collected on county tax bills in the same way ordinary ad valorem property taxes are collected. What other cities impose Mello-Roos special taxes and how much did they collect in fiscal year 1991/92? A survey of 12 similarly situated cities provided the following responses: Mello-Roos Taxes? Amount Collected? Camarillo Yes $1,250,000 Davis Yes $67400,000 Monterey No Napa No Palm Springs No Petaluma No San Juan Capistrano No Santa Barbara No Santa Cruz No Santa Maria No Ventura No Visalia No 46 What is the legal authority for this tax? The Mello-Roos CommunityFacilities Act of 1 2 98 , as amended. Although Proposition 13 severely limited ad valorem property taxes in 1978, it included provisions allowing local governments to impose other special property taxes with a two-thirds vote of qualified electors affected. The Mello-Roos Community Facilities Act set up the mechanisms for local governments to levy these special taxes. How much additional revenue could the City realize from these taxes? The amount of potential revenue is impossible to forecast accurately without knowing what eligible incremental services and improvements would be required of new development. What action is necessary to levy these taxes? Establishing a CFD can start by legislative action or by petition of registered voters or property owners. Once a CFD is proposed, the Council must adopt a resolution of intention, hold a public hearing, adopt a resolution of formation, and then put the issue to an election of qualified voters within the CFD. The proposition may be included on a general or special election ballot, or the election may be conducted by mailed ballot. The tax must be approved by two-thirds of the votes cast. If approved, the Council must then adopt an ordinance in order to levy the tax. How can Mello-Roos special taxes be used? They can pay for either services or capital facilities. Allowable services are narrowly defined: only additional services beyond those already provided are eligible and these services can only be in the following areas: police protection, fire protection, recreation, and flood control. Capital facilities may be special benefit facilities such as streets, water, sewer, and drainage facilities or general benefit facilities like parks, police stations or administration buildings. When and where would Mello-Roos special taxes be most appropriate? In newly developing areas and areas undergoing rehabilitation. In newly developed areas, the cost of all additional police, fire, recreation and flood control operating services could be covered through Mello-Roos taxes. Likewise, all additional facilities needed, like parks, fire stations and flood control projects, could be financed by these levies. When could Mello-Roos taxes take effect? At the earliest, 150 days after adoption of a resolution of intention. 47 Are there any special implementation issues? If there are fewer than 12 registered voters within the CFD, the vote is by landowner, with each owner granted one vote for each acre of land owned. For this reason, Mello-Roos taxes are most commonly associated with newly developed areas. Although legislation allows wide flexibility in apportioning Mello-Roos taxes, they may not be assessed in proportion to the value of real property within the CFD, because Proposition 13 restricted additional ad valorem taxation. Most Mello-Roos taxes have been assessed on the basis of development density, square footage of construction, or acreage. 48 RECREATION FEES FACT SHEET What are recreation fees.? Recreation fees cover participation in all recreation sponsored programs. Fees extend to cover participation in programs as well as facility use and rental and equipment use. Individuals residing outside the legal city limits of San Luis Obispo are assessed an additional fee for participation. Are these fees in place at this time? Yes. Fees are assessed for all but a very few programs provided by the City of San Luis Obispo. Examples of programs the Recreation Department still provides for no fee include family and community activities in Mission Plaza, four Thursday Night Activities at Farmer's Market, drop-in use of the Recreation Center. Who pays the fees? The fee is paid by the individual wishing to participate or have their children participate. Recreation fees are one of the "kindest" types of fees imposed by a City because the individual has the choice to pay the fee in exchange for enrolling to participate in an activity or using a city facility etc. There is always a tangible return for paying a recreation fee. Who currently receives the revenue? The City of San Luis Obispo general fund receives 100% of the revenue generated by the fees and charges implemented by the Recreation Department. This amount of generated revenue currently reflects 50% of direct costs for Recreation Department operation. If you were to consider total costs the recovery would be 36%. Pursuant to the city's user fee policy, total costs includes program administration, city wide indirect costs and essential maintenance and support services from Public Works such as swim center maintenance and ballfield preparation. Can cities increase the fees charged by their Recreation Department? Yes. Cities are allowed to set their own fees for recreation services. San Luis Obipso's fiscal policy outlined in the 1991-1993 Financial Plan incorporates cost recovery goals as an avenue by which the Recreation Department staff determines the fee for service. The City Council approves a level of cost recovery to be attained by the Recreation Department and staff establishes the fees for program participation. Have any other cities adopted their own cost recovery goals? Yes. Of the twelve cities surveyed, seven responded. The responses indicated that while none of them had policy statements determing the level of cost recovery to be achieved,the cost recovery targets for these cities ranged from zero to 75% up to but not including expenses for regular employees. The city recovering 75% was a special ' recreation district. Six of the seven cities were in the recovery target of zero to 55% of direct costs. None of the cities were recovering indirect costs. 49 How much revenue would an increase generate? Increases of Recreation Department fees have been held to a minimum over past years and in some instances program areas have not been increased since 1988. Fees charged for recreational services in San Luis Obispo are lower and in a few cases equal to those charged in other cities. Implementing a variety of fee increases that average less than 13% for most program areas would generate an additional $50,000. After this initial increase it is recommended that recreation fees receive an annual CPI adjustment. Examples of fee increases are listed below: Program Amount of increase Adult Sports Fees $20/team Youth Sports Fees $2/participant Childcare $ .25/hr Rec Center Activity Fees 20 uses/$15 (new fee) $2./use BBQ Use Fees $2.60/use What authority is required to increase the fees? Council would have to increase the overall cost recovery policy for recreation programs from 40% to 50%. How can these revenues be used? These revenues are presently credited to the general fund and can be used to offset the direct costs of Recreation Department operating costs. How would these revenues be collected? The process by which these fees could be collected is already in place. Participants can process payment of fees by phone, mail or walk-in at the Recreation Department's full service counter and can make payment in check, cash or credit card. When could an increase be effective? Programs and publicity for all department activities is already distributed for events through June, 1993. It is possible to increase fees mid quarter although not conducive to good public relations to adjust fees in mid-program. An increase could easily be implemented in July, 1993. 50 PARK IN-LIEU FEES FACT SHEET What are park in-lieu fees? Park in-lieu fees are a part of the Subdivision regulations that require subdivider to dedicate land or pay fees in-lieu of dedicating land for parks. Is this fee in place at this time? Yes. The formulas which determine the land or fees to be dedicated were adopted in 1984 and have not been adjusted since implementation. Resolution 5376 determines the limits of park in-lieu fee assessment. Who pays these fees? Ultimately the developer is responsible for fulfilling the land or fee requirement as determined by the formula specified in the policy. In some developments this is passed on to the individuals purchasing the homes in the development. Who currently receives the revenue? The revenue is received by the City and deposited into the Parkland Development Fund. Can cities increase their park in-lieu fee requirements? Yes. California Government Code Section 66477 authorizes the city to, by ordinance, require dedication of land, the payment of fees in-lieu thereof, or a combination of both, for park and recreational purposes. Have any other cities adopted their own park in-lieu fee structure? Yes. Nine of the twelve cities contacted responded. Seven of the nine have some form of park in-lieu fee policy. Of the responding cities, rates are very diverse in regards to the type of unit to be developed. Rates are as diverse as the cities surveyed. The fee used for single family dwellings for each of the responding cities is listed below. Park In-Lieu Fee/Single Family Dwelling Assessment (NR = No response, 0 = does not assess) Palm Camarillo Davis Monterey Napa Springs Petaluma NR NR $ 1950 $ 1335 0 NR Santa Santa San Juan Santa Barbara Cruz Capistrano Maria Ventura Visalia 0 $ 1300- $ 4840 $ 1756 $ 1504 $ 450 $ 3000 51 How much revenue would an increase generate? This depends entirely on the number of requests for development multiplied by a revised park in-lieu formula. Council Resolution 5376 imposes a limit on the park in- lieu fee assessed per unit developed. See the attached copy for the limits. The following is a summary of park in-lieu fees collected for the last three fiscal years. 1989-90 1990-91 1991-92 $140,290 $ 92,356 $120,867 What authority is required to increase the park in-lieu fee structure? The Council, by resolution, may establish the structure by which the fees and/or land dedications are assessed. How can the collected in-lieu fees be used? In some instances land is the dedication instead of fees. When this occurs the land is scheduled for development as a park or to be retained as open space. In the cases where park in-lieu fees are collected, the fees are deposited into the Parkland Development Fund and retained for future park development or land acquisition. Why is this an appropriate City funding source? It is already in place as a part of the development fees and has been since 1984. In exchange for being able to develop land in the City of San Luis Obispo the dedication in the form of land contributes to the preservation of open space or park land. On those occasions when a fee is assessed, the developer is assisting in the development of park and recreation amenities in the community. How should these fees be collected? The avenue for the collection of these fees is already in place and should continue to be collected as a part of the subdivision regulation process. When could an increase be effective? An increase could be implemented immediately upon Council approval. 52 RESOLUTION NO. 5376 (1984 Series) A RESOLUTION OF THE COUNCIL OF THE CITY OFA SAN LUIS OBISPO ESTABLISHING MAXIMUM PARK IN-LIEU FEES PURSUANT TO THE SUBDIVISION REGULATIONS WHEREAS, California Government Code Section 66477 authorizes the city to by ordinance require dedication of land, the payment of fees in-lieu thereof, or a combination of both, for park and recreational purposes as a condition of approval for a final tract or parcel map; and WHEREAS, the city has adopted such requirements in its Subdivision Regulations (Municipal Code Sections 16.40.060 through 16.40.100), which allow the council, by resolution, to establish criteria for determining and procedures for collecting fees, including a maximum fee per dwelling; and WHEREAS, the council hereby determines that the methods for determining park in-lieu fees provided in the Subdivision Regulations and current land values result in some cases in excessive and inequitable fees. NOW, THEREFORE, BE IT RESOLVED by the council of the City of San Luis Obispo as follows: 1. For any subdivision in which the size (bedroom count) of the dwellings is established at the time of tentative map approval, in-lieu fees shall not exceed: a. $667.00 for each studio dwelling, as defined •in the Zoning Regulations; b. $880.00 for each one-bedroom dwelling; c• $1,333.00 for each two-bedroom dwelling; d. $21000.00 for each three-bedroom dwelling; e. $2,666.00 for each dwelling with four or more bedrooms. 53 R 5376 2. For any subdivision in which the size (bedroom count) of . dwellings is not established at the time of tentative map approval, in-lieu fees shall not' exceed: a. In the C/OS and R-1 zones, $2,000.00 per dwelling, considering the maximum number of dwellings which could be built under applicable zoning in the subdivided area. b. In all zones other than C/OS and R-1, $1 ,333.00 per dwelling, considering the maximum number of dwellings which could be built under applicable zoning within the subdivided area. 3. Where a subdivision is to accommodate group housing (residential facilities other than dwelling units), the maximum fee shall not exceed $667.00 per person expected to reside. 4. In any subdivision, the determination of land to be dedicated or fees to be paid shall exclude the population expected to reside in dwellings or group housing which existed prior to approval of the tentative map. On motion of Councilwoman Dovey seconded by Councilman Settle , and on the following roll call vote: AYES: Councilmembers Dovey, Settle, Dunin, Griffin and Mayor Billig NOES: None ABSENT: None The foregoing resolution was passed and adopted this 5th of June 1984. ay anie C. Bi Attest: v City lerk Pamela ges 54 TRANSPORTATION IMPACT FEE FACT SHEET What is the purpose of a trmcrportation impact fee? It This fee is being proposed in order to ensure that new development pays its fair share of the cost of constructing transportation facilities that will be necessary to service increased demands from new development. How is the fee calculated? The fee is calculated under strict State requirements (AB 1600) that establish the criteria that must be used in determining all types of development impact fees. This includes ensuring that a"reasonable relationship"exists between the need and cost of a public facility and the development on which the fee is imposed. Are there specific projects that this fee will assist in fiaiding? Yes. The specific street improvement projects are those included in the Hearing Draft of the General Plan Circulation Element that was accepted by Council in May, 1992. The transit improvement projects are those included in the September, 1991 Short Range Transit Plan, and the bicycle facilities are those included in the San Luis Obispo County Regional Transportation Plan. But don't these projects benefit existing residents as well? Some of them do, but the impact fee has been calculated based solely on the portion attributable to new development. How is the benefit determined? The primary factor used in apportioning benefits is average daily trips (ADT). Current and projected ADT's were developed based on the Draft Land Use and Circulation Elements of the proposed General Plan as calculated by the City's automated traffic model. Those ADT's were then allocated by type of development. How much is the new fee? Although the amount of the fees has not been finalized, the listing below provides the approximate amount for each land use category: ■ $ 2,000 per single family residential dwelling unit ■ $ 1,800 per multi-family residential dwelling unit ■ $ 3,000 per thousand square feet (KSF) for retail ■ $ 4,000 per KSF for office ■ $21,000 per KSF for service stations ■ $ 2,000 per KSF for service commercial ■ $ 1,000 per KSF for industrial ■ $ 950 per room for motel/hotel Are any subsidies appropriate? As a part of the City's strategy for economic stability it is recommended that retail and hotel/motel developments receive a 50% reduction to the fee identified in the impact fee study. This reduced fee will create a shortfall in revenues needed to construct J transportation projects on which the fee is based. However, the shortfall can be subsidized using other sources of revenue such as sales tax and transient occupancy tax revenues produced by the developments. How do the fees compare with other cities? Single Family Commercial Monterey None None Napa $ 1,853 $ 5,530 per KSF Santa Cruz None None Ventura $ 5,245 $ 4,130 per KSF Santa Maria None None Petaluma $ 29900 $ 2,400 per KSF Camarillo $ 4,240 $ 3,220 per KSF Santa Barbara None None Visalia $ 853 $ 6,716 per KSF Palm Springs $ 810 $10,000 per KSF Davis' San Juan Capistrano 1% of Bldg. Value 1% of Bldg. Value s Transportation Impact Fees are included in a total impact fee charged which varies in each of seven plan areas. As reflected in this exhibit the City's proposed fees are within the mid-range of those charged by comparable cities. When is the fee calculated and paid? The fee will be "assessed" at the time that a completed application is submitted for building permits. They must be paid before the building permit can be issued. Under this approach, the fee will not change while building plans are being reviewed. What authority is required to implement this fee? Implementation of this fee requires Council approval. How will this new fee affect projects currently m the development review process? It depends on what stage they are in: ■ Projects which have submitted completed applications for building permits by the effective date will not be required to pay these fees. ■ Projects which have vesting tentative tract maps approved by the effective date will not have to pay these fees unless there was a condition to pay transportation fees at a later date. ■ Any other projects that have not submitted completed building permit applications by the effective date will be required to pay the new fees. 56 GENERAL FACILITIES IMPACT FEES FACT SHEET What are impact fees for general facilities? They are fees collected from land developers to pay for their share of facilities which benefit the entire community but must be built or enlarged because of the new development. Such facilities might include recreation centers, cultural halls, police stations, fire stations, general government office and maintenance buildings. Does the City collect these fees now? No. Who would pay these fees? Developers of large parcels and subdivisions. Who would administer these fees? The City would collect these fees when building permits were issued. What other cities impose these fees and how much did they collect in fiscal year 1991/92? A survey of 12 similarly situated cities provided the following responses: General Facilities Impact Fees? Amount Collected? Camarillo Yes $19580,000 Davis No Monterey No Napa No Palm Springs No Petaluma Yes $370,000 San Juan Capistrano No Santa Barbara No Santa Cruz No Santa Maria No Ventura Yes not known Visalia No 57 What is the legal authority for these fees? Authority is usually inferred from the Subdivision Map Act, state zoning law, and powers accruing from charter city status. Assembly Bill 1600 (AB 1600) ensures that a reasonable relationship exists between the development on which the fee is imposed and the need and cost for public facilities. How much additional revenue could the City realize by adopting these fees? The amount depends on the extent of projected new development and the type and cost.of facilities required. Precise forecasts would require more detailed analysis using AB 1600 guidelines. Preliminary estimates show that these fees could bring in an additional $250,000 to $500,000 each year. What action is necessary to impose these fees? The City would have to establish standards and formulas which could withstand legal challenge. Once an acceptable formula were established, collecting the fee with other development and building fees would be fairly straightforward. How can these fees be used? They can be used only for the purposes for which they were established. Why are development impact fees appropriate for financing general facilities? New development always brings an incremental new demand for services and for facilities to accommodate those services. It is appropriate for new development to pay a reasonable share of new facilities which serve it. When could development impact fees for facilities take effect? Once an acceptable contribution formula were established, it would take about three months to prepare and enact an ordinance. 58 LOCAL OPTION SALES TAX FACT SHEET What is a local sales tax? The County could impose an additional tax on local sales if it is approved by a majority vote of the local citizens. The amount could be as low as .0025 (1/4) cent and is limited to .0150 (1 1/2) cents. How much revenzw would this tax generate? The amount of revenue that would be available to the City by such a tax is unknown because an allocation formula between the County and its cities would need to be developed. However, the following chart provides some ranges based on the percentage amount of the tax and various allocation alternatives: Allocation Basis o to SLO 1 Cent 112 Cent Population (pop) 21.8% $3.2m $1.6m Road Mileage (RM) 5.4% 0.8m 0.4m Sales Tax (ST) 39.5% 5.8m 2.9m 50% Pop/50% RM 12.4% 1.8m 0.9m 25% Pop/25% RM/50% ST 25.4% 3.8m 1.9m What authority is required to assessluxrease this tax? The Revenue and Taxation Code Section 7258 has been the authority to impose this tax, however, the constitutionality of this section has recently been challenged. How can these revenues be used? Use of the funds are usually specified when the tax is imposed: transportation authority, educational financing, or parks and open spaces. Why is this an appropriate City fundbzg source? The local consumer benefits from a variety of general fund services while shopping in San Luis Obispo: public safety, pleasant surroundings, well maintained streets and sidewalks. It is appropriate that the consumer share in maintaining these high levels of service with a slight surcharge on their purchases. How would these revenues be collected? The State Board of Equalization is the agency tasked with collection and distribution of this tax. When could the &xrease be effective? Upon voter approval, which can be accomplished at the next special or general election. Have other counties adopted this tax? Yes, twenty-eight California counties have adopted a local sales tax; 22 of which are • specifically for transportation purposes. However, some of these assessments have been challenged in court, and San Diego recently had their tax rescinded. 59 This tax is currently in place in Santa Barbara County at a 1/2% level. From this source, the City of Santa Maria receives $1.3 million annually in local option sales taxes, the City of Santa Barbara receives $25 million. What are the negative impacts of implementu;g azaearing this tax? The City is already experiencing a perceived exodus of shoppers to Santa Maria. Imposition of an additional tax on local sales may further disenchant local shoppers. More fundamentally, the requirements that a county must follow to impose a tax are now unclear due to recent litigation. Two court decisions rendered conflicting results, and the Attorney General's opinion would completely invalidate the section of the Revenue and Taxation Code which allows counties the authority to assess this tax. Until the legality of the tax is resolved, the County of San Luis Obispo is not considering the local sales tax as a viable revenue source. a:\sALESrAX 60 ANNEXATION FAC. SHEET What properties-should be considered? Cal Poly campus and the California Mens Colony should be considered for annexation to the City. Are mtneradon procedures bi place at this time? The City has not previously investigated the feasibility of this annexation. What procedures would be nececsmy for mvueration? If the City initiates annexation it must: ■ Open discussions with the State to discuss mutually beneficial reasons for annexation ■ Prepare an Environmental Impact Report ■ Hold public hearings to amend the General Plan and any pre-zoning changes ■ Obtain Planning Commission approval ■ Obtain City Council approval ■ Change the Urban Reserve Line ■ Negotiate with the County for property and sales tax arrangements ■ Obtain LAFCO approval ■ Obtain approval from the registered voters in the annexation area How much revemm would this tax generate? Annexation of Cal Poly, in conjunction with the implementation of an Admissions Tax, would open the opportunity for additional revenue from cultural and sporting events held on the campus. With the advent of the Performing Arts Center, frequent use of this facility, by a large number of participants is anticipated. Annexation of both Cal Poly and CMC would also increase the City's population base for subventions that are generated on a per capita basis, as well as situs sales tax from Cal Poly. This is estimated to be $600,000 annually. What are the negative bnpacts of annexation? Annexation of both properties should have no or very low cost related to the provision of City services, because both institutions have their own basic services; however, if due to budget constraints, these services were terminated by the institutions, then the City would have the primary responsibility of providing all municipal services. a:\ANEXTION 61 I PROPERTY MANAGEMENT REVENUE FACT SHEET What is revenue from property management? The City currently has an inventory of more than 145 pieces of real property which could yield some combination of ongoing and one-time revenues. The City's property management manual outlines a strategy for leasing and disposal of real property. Using these guidelines, with some revision, each piece of property could be reviewed for its ability to create revenue, either through lease or sale. Is an adopted program in place at this time? Yes. The City has a property management manual, but it could be updated to reflect a changing property management strategy which would emphasize an aggressive revenue program. Who collects these fees? The fund that paid for the real property would be the fund that would collect any revenue from the lease or sale of the property. Have other cities adopted a property management program? Of the 12 survey cities listed below, three responded that they have adopted a formalized property management program. These were the cities of Monterey, Palm Springs and Santa Cruz. Palm Springs developed a property strategy with the adoption of a redevelopment plan. Napa, which did not respond that it had a formalized program, does have a property manager whose function is to acquire property necessary to certain capital improvement projects. Camarillo San Juan Capistrano Davis Santa Barbara ./ Monterey J Santa Cruz Napa Santa Maria J Palm Springs Ventura Petaluma Visalia How much revenue would an increase generate? This would vary according to the property. The list below represents a very quick estimate of some of the City's holdings which might be eligible for this type of program: Appraised Value ■ Main Fire Station property, Garden and Pismo 8009000 (upon construction of new Main Fire Station) ■ Recreation property, 860 Pacific . (upon construction of new Main Fire Station) 650,000 ■ Emerson school site, if Fire Station located ** 19700,000 on another piece of property ■ 320 acres near Lopez Canyon undetermined ■ Reservoir Canyon property undetermined 62 ■ Court Street 290009000 ■ 955 Morro and adjacent parking areas (identified as undetermined priority project in downtown Master Plan) "Assumes 1/3 of the site is maintained in open space and park-type uses. What action is necessary? The first step would be a detailed analysis of all city real property and identification of an appropriate economic strategy or use for each piece of property. Council could then identify which properties should be looked at further for possible lease or sale. How can these revenues be used? The revenues would become available for use by the appropriate Fund. One time proceeds could_be used to offset expenses of approved capital projects. Ongoing revenues could offset some operational expenses. When could an increase be effective? Revenues would be tied to the disposition of each piece of property. Are there any special implementation issues? Yes. Any disposition of City-owned property must be in accordance with Government Code Section(s) 65402 and 54220. In the case of a sale, the Planning Commission must determine compliance with the General Plan. Before a sale or lease is awarded, city-owned property must be offered to (1) the Housing Authority, (2) parks, recreation and open space areas, (3) enterprise zones, and (4) schools. An offer from these entities need only be accepted if the terms are acceptable to the City. 63 PRIVATE/PUBLIC PARTNERSHIPS FACT SHEET What are private/public sponsorships? These are combined efforts between municipalities and businesses,volunteers,service clubs or individuals to continue to fund existing levels of programming or service or begin new services or projects by receiving support through a combination of cash, services, volunteer assistance, supplies, or promotional opportunities. Are examples of public/private sponsorships in place at this time? Yes. On a level visible within the City of San Luis Obispo, examples include the volunteer labor contributions used to rehabilitate the Jack House and various park projects, annual special events through the Recreation Department, and product co- sponsorship of special event opportunities. On a larger scale, Carnation underwrites services at Disneyland in exchange for being the "official ice cream" and McDonald's built the swim center for the 1984 Olympics, "Adopt A Highway" litter clean-up program implemented by Cal Trans, sponsorship of Atlanta Georgia by VISA company. Who receives the benefits of the sponsorship? The immediate benefit is to the residents of the community by either receiving a reduced rate for service or the continuance of a service or program that may be scheduled for elimination. Who receives the contribution of either cash or in-kind service? The city or department pursuing the involvement of the volunteers or private support. Have any other cities undertaken these ventures? Yes. For the purposes of Parks and Recreation most of the cities contacted had the same involvement as San Luis Obispo, receiving inkind contributions for special events and programs. Some of the more aggressive examples include the following: ■ Davis. Rehabilitated an old theater into a performing arts center with contributions from private developers. ■ Monterey. Developed a sports center with 2 pools, gymnasium, weight and fitness rooms with contributions from B of A, Sardine Factory, radio and local TV, etc. ■ Napa. Established a tax exempt foundation to receive donations for the operation of the recreation department. Several cities employ a fund raising manager or a promotions manager to pursue these types of arrangements. How much revenue would be generated? This depends on what level or types of sponsorship are pursued. It could be as comprehensive as the financial underwriting of the whole city, as with Atlanta Georgia, or as subtle as a community service club adoption of street tree well _ cleaning, business sponsorship of the trolley, or the donation of all the snack food for the childcare program. 64 What authority is required to pursue these opportunities? If the commitment was to pursue a large scale community wide financial underwriting of a particular portion of a City operation, it would require Council approval. The more subtle forms, some of which are already in place, are approved at the staff level. Why is this an appropriate funding source? While this is not a new concept for providing financial and inkind support to government the use of this method is increasing due to the difficult financial times at hand. It is a chance to allow residents from the area, businesses in the community as well as corporations to reinvest in their community to sustain the infrastructure in an attempt to continue necessary services. It is appropriate for these private entrepreneurs to return contributions to the area which they target for support of their business. Since it is accomplished on a voluntary arrangement it is completely open to choice by the group, individuals or business to respond affirmatively. How would these revenues be collected? It would vary with the type of contribution received. Volunteer efforts and small event sponsorship in the form of materials would be collected and monitored by the department. A monetary contribution would be collected by Finance. When would a venture of this nature be effective? The time frame for implementation is dependant on the type of contribution and determination of which level to pursue. Some of types are already functioning. With a commitment for a large scale private/public sponsorship it would occur after Council endorsement and direction to staff. 65 4 Section E BACKGROUND MATERIALS This section provides the following background materials: Contents s Memorandum from the CAO dated November 5, 1992 regarding the status of the Performing Arts Center 1 ■ Memorandum from the CAO dated January 22, 1993 regarding budget season impacts on City employees and the City Council's role 4 0 Total cut solution guidelines and direction to staff 6 ® r �►i�►�II�II�IIIIIIIIIIIIIIIIIII IIS 1A111111111111 I city of sAn luis oBispo 990 Palm Street/Post Office Box E100 • San Luis Obispo, CA 93403.8100 November 5, 1992 MEMORANDUM To: City 'Council, Council-Elect From: JohnDun Subject: Perf min is Center When Bill Statler and I met with and spoke to groups of our City employees about the City's fiscal situation, it became obvious to the employees, after hearing/seeing Bill's mid-range forecast, that the City needed to dramatically reduce its expenditures, which would probably result in both service and personnel cuts. One question that was asked in response to this situation was: why doesn't the City do away with, or defer, the Performing Arts Center project, so that this money could be used for other City purposes? I answered these two questions in very definite terms and, I believe that most of those employees who heard the answer were satisfied that to proceed with the project is a correct course for the City. However, I fully expect questions regarding the Performing Arts Center to be raised this spring as we go through the budget ocess, particularly when we have to consider personnel cutbacks. I will describe, with augmentation, what I told the employees: The City first started to take a serious look at the possibility of a Performing Arts Center within the City in about 1983. In 1985 the City, by itself, had paid for a major planning/evaluation study for a performing arts center performed by the firm of Hall, Goodhue, Haisley & Barker. The HGHB study, after assessing community need/desire, started by looking at a location in the downtown. It was quickly realized that a parcel of sufficient size, with adjacent parking, and at a cost which could be afforded, was not to be had in the downtown. Concurrently it was realized that if such a facility were going to happen in San Luis Obispo, it would have to be in conjunction with other parties. That realization caused the search for a cooperative working relationship which ended up with a consultant recommendation that the facility be built on the Cal Poly campus, with major University assistance, and that the University and City efforts be augmented by a strong private sector fund-raising campaign. In 1986, a "memorandum of agreement" was entered into between the University, the Foundation for the Performing Arts (a private non-profit corporation) and the City. In 1987 and 1988 the three parties worked together to produce a "development agreement" which basically set forth the kind of facility that was desired, and the basic responsibilities of the three parties to the its eement. All three parties agreed and approved the agreement, which vided for the land 'to be donated by Cal Poly, and for the construction to be paid 1/6 by the City, 1/6 by the Foundation and 2/3 by Cal Poly. The three parties then hired the architectural firm of Arthur Erickson & Associates, who made subF ntial progress on the "cor -pt development" plan, 1 then went bankrupt. Subsequently the three parties hired the firm of Carl Warnecke & Associates, working in conjunction with Daniel Mann and Johnson Mendenhall (DMJM - "Dim Jim") . . Warnecke/DMJM is presently well advanced in completing the working drawing stage. The pre-1987 early planning of the project happened before I was in San Luis Obispo. However, in reading the HGHB report and talking to others, it is fair to say that a Performing Arts Center was thought necessary to give the area the kind of cultural events desired by a large number of people, to create a proper facility for the kind bf cultural events that would be attractive to both our own residents and which would be a factor in attracting people from other areas, as is the case for .the Mozart Festival. From the beginning, the Performing Arts Center has been thought of as a major enhancement to the area's cultural environment as well as an -augmentation of current efforts at visitor attraction and local business generation. More recently, as an expansion on the earlier ideas, I have heard various people in the visitor industry refer to the increased need to broaden the base and to "focus the image" of the visitor industry in San Luis Obispo County, with the thought being expressed that this could probably best be done by enhancements in major outdoor recreation activities (golf, sailing and scuba diving, as examples) and cultural activities. While a relatively small number of people are attracted here because of cultural activities alone, analogous to Thursday night, discovery of a rich cultural environment while visiting causes visitors to prolong their stay or to come back later for another stay. As the Council is aware, the three parties to the agreement sighed a breath of relief this fall when, despite unprecedented cuts to the State budget over the past two years, the State's share of the construction money, approximately $17, 000, 000, was preserved for this project, with the anticipated construction start-up date being this coming spring. Two major points in relation to the City's portion of financing the Performing Arts Center should be made. First, going back to the 1987-89 City financing plan, the City Council's stated intent at that time was that the Transient Occupancy Tax (hotel/motel tax) be raised from 6 to 8% for the purpose of raising the City's share of the Performing Arts Center. Last year the City Council raised the TOT rate from 6 to 9%, which raises an additional $600,000 per year, $400, 000 which would be used for the annual bond redemption for the project, and $200, 000 which goes into the City's General Fund; to help pay for city operations. Second, long-term bonded indebtedness can only be used for long-term, community benefit public facilities, and cannot be used to pay for annual operational expenses. Except for the four enterprise funds (Water, Sewer, Parking and Transit) , it is the City's General Fund which pays for all other City operations. Now back to the employees' basic questions: could the City save about $4, 000, 000, or approximately $400, 000 per year for the next 20 years, if we ended our participation in the project? The answer is, yes, the City would save that money, which could be used for other municipal purposes. The "other shoe" would be that the current three-party agreement would be abrogated, the project would collapse, and the available State money would be irrevocably lost. Additionally, a construction project with positive economic impacts for our area would be lost, staffing for the Performing Arts Center would be lost, cultural and performance opportunities would be lost to the area, and anticipated assistance to the visitor economy would not occur. I explained .that before ar•, such decision could be maO- by the City Council, Councilmembers would havc o work with the other pat as to the agreement, 2 listen to our own citizen including many who have an intense interest in the artistic and cultural life of the community, and would have to weigh the costs saved versus the cultural and economic benefits lost. I also said that 40 there were any solid thought the City was going to give up its 1/6th share the project, causing the project to die, and if this matter were placed on City Council agenda, a large number of people would turn out to argue against the decision. These people would represent diverse interests, cultural and performing organizations, citizens and business representatives who are counting on/desiring the Performing , Arts Center, unions and contractors and construction workers who would bemoan the loss of a $25, 000,000 building project to our area, friends and supporters of Cal Poly and the Foundation for the Performing Arts, participants and supporters of the visitor industry and the local economy and others. For the City to make a unilateral decision to pull out of the project would effectively kill the project, and this is not necessarily what the people of this area want or would tolerate, because it would be harmful to both the local cultural environment and the short-term and long-term economic environment. The question: "why can't the project be deferred for just two or three years?" has a simple answer. We either build it now, when the State money is available or we lose the State money, and the project. We would also lose the continuity/momentum created by the long standing efforts of the Foundation for the Performing Arts, which is essential to the project, both for a substantial portion of the construction cost (equal to the City) and for creating a substantial endowment to assist with the operation, particularly during the first critical years. The Foundation has raised approximately $7,900, 000 (contribution and endowment) to date and has a c^irrent goal of raising $11,200, 000. In summary, in our meetings with employees there were some negative perceptions expressed towards the City,s plan for proceeding with the Performing Arts Center, to spend $4, 000,000 or $400,000 a year on a major public facility when the City is facing a serious financial situation. Some employees had a perception that the Center is some kind of cultural arts frill, not fully justified in difficult economic times. When the project was more fully explained in terms of the money and the visitors which would come into the area as a result of the facility construction and use, generally there was a much greater acceptance of the project. Other cities and communities have made such a commitment during tough times, based on the long-term needs of the City, and the desires of the citizens. A facility that should have a useful life for 75 or 100 years or longer, which will stimulate the cultural and performing arts, and the visitor economy, should be a source of community betterment and pride. The ultimate question is whether this project is worth it in the total life of the community. As you know, a great many people in the City and throughout the County believe it is. JD:mc C. Management Team Members - Employee Working Group President Warren Baker, Cal Poly ' Dr. Glenn Irvin, Chairman, PAC Steering Committee Mr. Warren Sinsheimer, Foundation for the Performing Arts Dr. Jim Jamieson, Executive Director, Foundation h/pac 3 r...- u���� city of sAn is OBISPO 990 Palm Street/Post Office Box 8100 • San Luis Obispo, CA 93403.8100 January 22, 1993 MEMORANDUM To: City Council From: John Dunn Subject: BUD T SE IMPACTS ON CITY EMPLOYEES AND THE CITY COUNCIL'S ROLE As the Council is aware, I have asked each of the departments to submit a budget proposal based on two levels, the City's current $2 . 5 million operating deficit and an additional $1. 5 million revenue loss from the State. In this exercise these figures are not moderated by any assumptions about what the employee groups may be willing to do in terms of lesser salary or lesser working days, or what the City Council might be willing to do in regard to increased revenues, until the City Council has given policy direction in these areas. Needless to say, this exercise,. which is open to our employees, has generated a great deal of concern among our City employees. Some are concerned about the possibility of losing their job, their source of income. While this is a very negative aspect of the unfortunate position we are in, there seems to be no way around this issue, given the fact that we are a democratic organization rather than a closed one, and our departmental personnel are an integral and necessary part of our decision-making process. . Because of this situation, if individual employees or representatives of employee associations contact you, I would expect you to follow your basic instincts and to listen and be empathetic. However it would be best not to make or infer promises or give intimations as to what you and the Council might be doing. You do not want to give false expectations nor to restrict your own subsequent decision-making ability. Sometime during our budget operation and review period (admittedly, with a bit of simplification) the City Council will have to make a policy decision between two basic choices: 1. The Council could decide to go through the budget line item by line item, and position by position, and make hundreds of individual, painful choices. 4 2 . The Council could decide to place itself in a policy-directing position, primarily examinin4 the public service impacts and the revenue/expenditure/deficit determinations, and empower the staff to make those decisions necessary to implement the City Council's policy direction. While this latter course implies the need for trust in the staff, and some delegation of decision-making authority, it may be the only practical way to get us through a very difficult season without placing the City Council in a very unfamiliar and uncomfortable and unrewarding role. These are some thoughts, given to you in advance of budget decision-making, which might be further discussed prior to your giving policy direction in these areas. Thank you. JD:mc h/contacts _.. 5 Total Cut Solution Goal • Identify service level/expenditure reductions that will close the projected gap between revenues and expenditures without any new(or increased)revenues or labor cost savings Guidelines w No sacred cows - must be real w- No revenue offsets - must be expenditure reductions only,net of any reduced revenues r No speculative reductions - must be a cost area over which management has control (ie,no attrition nor personnel actions that are likely to get bogged down in meet-and-confer) W No delays- must be able to immediately begin implementation upon adoption of the 1993-94 Budget W No contract employee savings(unless their existing contract extends beyond 1992-93) - we assume these! mo- No deferred savings - facilities,equipment&infrastructure must be maintained at levels that will preclude the need for major rehabilitation in the future Meehn 'these fdeliaes means thatalmostall of' rirreduchons will have to Mme hoai`re ularsta@Fn Target Reduce General Fund Expenditures By r $25 million to address projected revenue/expenditure gap r Additional$15 million to address potential state revenue cuts to cities as part of their budget process Content Same basic format used in preparing the S%and 1090 expenditure reductions. W Organized by$25 million and$15 million level,summarized by program W Description of cut and its service impact W Summary of regular positions affected and annual savings(including related operating savings) Due Date Submittals from the departments are due Wednesday,February 11. Tar is 1992-93 Revenue end Gap State -Aways GENERAL FUND Budget Amount Staffing* Amount Staffin • City Council 140,900 16,200 0.0 9,700 0.0 Administration CAO's Office 512,000 59,000 1.1 35,400 0.6 Cultural,Social&Economic 698,400 80,500 0.0 48,300 City Attorney 254,500 29„300 OS 17,600 03 City Clerk 350,500 40,400 0.7 24,300 0.4 Personnel 516,500 59,600 1.1 35,700 0.6 Finance 1,029,500 118,700 22 71,200 13 Insurance&Non-depart'l 980,900 Community Development 1,584,700 182,700 33 109,600 2.0 Recreation 1,343,300 154,900 2.8 92,900 1.7 Public Works 5,185,700 598,000 10.9 358,900 65 Utilities 58,600 6,800 0.1 4,100 0.1 Police 5,844,800 674,000 123 404,400 7.4 Fire 4160 900 479,900 8.7 287,900 52 TOTAL`GENERALFUND .:22,66100 2.. 00'000: 43 T :; `:1` 00000 :26.1 Water 3,970,000 436,700 7.9 Sewer 2,355,900 259,100 4.7 Enterprise funds are not Parking 680„300 74,800 1.4 required toidendr ,cuts Transit 778,600 85,600 1.6 related to State revenue cuts Golf 289,300 31,800 0.6 to cities Whale Rock 615,600 , 67,700 12 TOTAL 31.550.9001:.:.::.::3,455.700.7.:7.....:...: 61.1j..... 1`500 262! ' Egivalent level of regular staffm- g cuts necessary to achieve the target 6 Section F "TOTAL CUT SOLUTION" OPTIONS This section includes the "total cut solution' options presented to the CAO by the operating departments. The purpose of this very rigorous and difficult process was to identify the service and expenditure reductions that would be necessary to address the City's projected revenue/expenditure gap in the General Fund if no new revenues or labor cost savings are implemented. Options were developed by departments at two tiers: ■ Cuts necessary to balance the City's projected revenue/expenditure gap in the General Fund as previously presented to the Council on November 10, 1992 (estimated at $2.5 million annually at that time). Even though the enterprise funds are self-supporting through their own revenue sources, they also participated in this very difficult process by developing expenditure/service reductions that reflected the same proportional cut in operations as a $2.5 million cut in the General Fund. ■ An additional $1.5 million (total contingency cut of $4 million) to address potential state revenue cuts to cities as part of their budget process (General Fund operations only). It should be emphasized that it was never the intent of this process to ultimately recommend or implement cuts at this level; however, surfacing options at this level was a clear goal in order to: ■ Provide Council with an array of reasonable policy choices. ■ Demonstrate the impact of these reductions as an important starting point in developing mitigation strategies. Each department submittal is preceded by an overview of the process used by them in developing their "total cut solution". Contents Summary of Expenditure/Service Reduction Options ■ City-wide 1 ■ By Department 2 Departmental Expenditure/Service Reduction Options ■ City Council 6 ■ Administration g ■ City Attorney 14 ■ City Clerk 17 ■ Personnel 20 ■ Finance 26 ■ Community Development 32 ■ Recreation 42 ■ Public Works 46 ■ Utilities 65 ■ Police 77 0 Fire 86 Summary of Expenditure Reduction Options (General Fund) Recommended Contingency Cost Savings Regular Staff Cost Savings Regular Staff SUMMARY BY DEPARTMENT Amount Cut City Council 16,200 0.0 9,800 0.0 Administration - CAO's Office 99,000 15 0 0.0 - Special programs 80,700 0.0 48,100 0.0 City Attorney 0 0.0 76,200 1.0 City Clerk 53,800 1.0 37,600 0.0 Personnel 95,300 15 0 0.0 Finance 133,100 3.0 56,800 1.0 Community Development 172,100 25 121,900 1.6 Recreation 105,800 2.0 144,700 2.0 Public Works 553,600 6.5 408,300 4.0 Police 504,600 6.0 571,300 8.0 Fire 375,600 , 6.0 394100 4.8 TOTAL .2,189,800: :::"30:0 :4.868.800. 22.4 Percent Cot City Council 12.1% 0.0% 73% 0.0% Administration - CAO's Office 20.1% 25.0% 0.0% 0.0% - Special programs 12.2% 0.0% 73% 0.0% City Attorney 0.0% 0.0%u 31.9% 33.3% City Clerk 16.2% 16.7% 113% 0.0% Personnel 195% 2.5.0% 0.0% 0.0% Finance 13.6% 17.6% 5.8% 5.9% Community Development 11.8% 11.2% 8.4% 7.2% Recreation 8.2% 15.4% 113% 15.4% Public Works 11.1% 9.9% 8.2% 6.1% Police 8.9% 7.1% 10.1% 9_5% Fire 9.2%.l 11.0% 9.7% 8.8% TOTAL;': 10.0% 10 8°6: ': 8 69b BTS%' NOTE: Vacant positions are highlighted in the following table. STATUS OF RECOMMENDED POSITION CUTS Administration PabGcWorks(Coatiaued) ;VaeadrPoWtioallotes�.:':��:.::.: : Administrative Analyst Filled Transportation Manager Vacant Administrative Secretary Filled Parks&Bldgs Manager Filled a. There are currently no City Clerk Project Coordinator Filled Battalion Chief vacancies,but Office Assistant Filled Supervising Civil Engineer Filled one incumbent is about to Personnel Maintenance Worker Vacant service retire. Health Work Coordinator Filled Heavy Equipment Operator Filled Personnel Assistant Filled Police b. There are currently only two Finance lieutenant Filled firefighter vacancies,but one Accounting Assistant(2) Filled Crime Prevention Coordinator Filled additional position is about to Customer Services Supv Filled Police Officer Vacant disability retire. Community Devlpmat Sergeant Filled Graphics Technician Vacant Communication Technician Filled c. All General Fund vacant Associate Planner Filled Records Clerk Vacant positions are cut under the Recreation Fire recommended scenario except: Recreation Coordinator Filled Battalion Chief-note a Filled Signal Maintenance Tech; Recreation Supervisor Filled Fire Engineer(3)-note In Vacant Computer Systems Tech;and Police Public Works Public Education Specialist Filled Officer. Secretary Filled I Fire Prevention Staff Filled tcsr=3-4-93 1 Summary of ExpendiLure Reduction Options (General Fund) Recommended Contin.,encv CITY COUNCIL Cost Savings Regular Staff Cost Savings Regular Staff Line item reductions Total 16,200 9"800 Pircent Reduiifion::::.: ADMINISTRATION CA O's Office Administrative Analyst 59,000 1.0 Administrative Secretary 20,000 0.5 Newsletter 20,000Total . 99,000A........ Percent Redii 1.%.... ..:25.0% 0.0% Special Programs (Same 9a reduction as overall General Fund cuts) Human Relations grants 9,000 29,600 Cultural activities grants 8,700 6,700 Community Promotion 24,000 19,800 Homeless shelter None Econ Stab(cut to$100,000) 39,000 (8,000Total1 .. ...... .. 80,7000 ::.....::: 0.0 ::...�:48,100. 0.0 [Percent:Reduction.....:: (TrY ATTORNEY Assitant City Atto ey 76.200 1.0 Total 76`200 10 1 ..�..3:Percent Reduction:.-:..::::. ......... 0 00% 0 .0% .9 .333% CITY CLERK Office Assistant 33,700 1.0 1st tier line item cuts 6,800 Other savings(2nd tier) 18,700 Council Secretary 5,600 0.1 Elections.... 13-300 13,300 Total ............... .37600 Percent Ttednctron .......... 0.0 PERSONNEL Risk Management Work Health Coordinator !44,700 1.0 Claims 14,900 Personnel Administration Personnel Assistant 19,200 0.5 Contract services 16,500 [Percent Reduction : : .25.0% 6.0 FINANCE Information Systems Temporary staffing 5,500 Contract services 7,200.0 Computer Systems Tech 49 600.0 Accounting Temporary staffing 9,600 Accounting Assistant 35,500 1.0 Revenue Management Accounting Assistant 35,500 1.0 Customer Services Supv 47000 1.0 Total 133 100<< .: ....30. 56 800 1.0 I Percent Reduction. .::. ::::.136% 1 7. 0.6% $.8%:: :..:.:..::5.9% 2 Summary of Expenditure Reduction Options (General Fund) Recommended Contin rencv Cost Savings Regular Staff Cost SavingsRe lar Staff COMMUNITY DEVELOPMENT Building& Safety Plan Check Engineer 7777722 12,000 03 Other savings(all @ 1st tier except training&trips) 6,800 5,300 commissionslCommittees Salaries 17,100 Printing 5,000 Meetings/trips 1,700 Other 2,900 Planning Office Assistant 11,000 , 03 18,400 0.5 Graphics Tech ......... 2800 0j. (8,300) (02: Associate Planner 49,700 1.0 56,600 1.0 Temporary staffing 10,000 11,800 Postage 500 Office/photo supplies 2,400 Drafting/blueprint supplies 400 Planning/MIS services 26,000 Office equip maintenance 4,000 Microfilm services 1,000 Training,etc 4,200 Material&supplies 5,000 , 172,100.;0.::.:..................: ...2-5 ..:.121900 1.6: Percent Reduction.:. ::::8.4%:: :. . ........ 7.2% RECREATION Administration Vehicle fleet reduction 7,800 Training 600 Recreation Coordinator 44,700 1.0 43,800 1.0 Recreation Supervisor 33,800 1.0 Office Assistant 32,900 1.0 General Recreation 1st Tier Temporary staffing 27,300 Related line item reductions 15,600 2nd Tier Temporary staffing 4,000 Aquatics Line item reductions 1,700 600 Special Instruction Temporary staffing 1,800 Special Events Temporary staffing 5,000 Line item reductions 8,300 Trips& Outings Reduce activites- 2nd tier 6,600 Reduce activities - 1st tier 16,000 Total.... 2.0 144700J.: Percent..... Reduction. 15.4% 3 Summary of Expendhure Reduction Options (General Fund) Recommended Contin tencv Cost Savings Regular Staff Cost Savings Regular Staff PUBLIC WORKS Administration Employee recognition 2,000 Temporary staffing 2,700 Office supplies 6,000 Printing 9,000 Secretary 19,100 OS Parks&Landscape Trash removal 7,300 Portable restrooms 5,700 Parks&Bldgs Manager 68,000 1.0 Maint/CMC labor 4,000 Weekend park maint 12,200 Ballfield maintenance 19,700 Minor service contracts 3,000 Minor construction contracts 10,000 Landscape maint contracts 44,300 Restroom maint contracts 18,000 Swim Center Maintenance Janitorial service contract 11,000 Tree Maintenance Promotion 3,000 3,000 Tree planting 4,100 4,200 Building Maintenance Library meeting room setup 5,000 Plant maintenance 2,500 Janitorial maint contracts 28,200 General Street Maint Sidewalk repair(Maint Wkr) 1.0 Lane line repainting 22,500 Welding repairs 5,700 Sidewalk grinding 6,500 Downtown sidewalk cleaning 20,000 Streets Maint Supervisor 52,000 1.0 Pavement Maintenance Thurs nite barricade removal 5,000 Trash removal 7,500 Project Coordinator 55,000 lA Sweeping(Heavy Equp Oper) 50,000 1.0 Traffic Signals and Street Lights Mid-block street lights 46,000 Vehicle&Equip Maint Fueling&washing 7,000 Engineering Consultant services 3,000 Temporary staffing 3,000 Blueprint supplies 4,000 Supervising Civil Engineer 72,700 1.0 CADD mapping(Eng Asst) 52,200 1.0 Inspection(Eng Tech) 41,000 1.0 Transportation Planning Transportation Manager 91"000 3:0. Traffic Engineering 52,200 1.0 Various Programs Standby duty 21,500 , Total :553,600:::: &5 .408 00 %4.0 Tercent:Reduction. 11 T% 9:9% '8:2% 6. V 4 Summary of Expenditure Reduction Options (General Fund) Recommended Contin en Cost savings Regular Staff Cost Savings Regular Staff POLICE Administration Animal regulation contract 14,000 Training/communications 34,500 Lieutenant 87,200 1.0 Crime Prevention Coordinator 51,900 1.0 Sergeant 78,600 1.0 Captain 92,900 1.0 Patrol Crossing Guards 30,000 Booking Fees 75,000 SORT Sergeant 78,600 1.0 Police Officer 121,600 2.0 Traffic Police Officer(commercial truck enforcement) 60800 10 Sergeant 78,600 1.0 Investigations Police Officer ARE 60-80 1.0 Police Officer(NTF) 60,800 1.0 Support Services Reords — temp staffing 5.500 Records Clerk 37100 0 Comunication Tech 48,000 1.0 48,000 1.0 Fleet reduction 12,000 Total ... . . .... ..... .........504.600: .571'300 Per&xit:Rednaio: .9% % FIRE Administration Line item reductions 18,500 Temporary staffing 10,200 Emergency Response Fire Engineers(see note) ::: :1.4 `600 :. : .:.: ...3.0 56,000 Overtime 25,500 Captains 775,400 3.0 Hazard Prevention Secretary 10,100 03 Fire Education Spec 26,400 0-5 Fire prev regular staffing 54,300 1.0 54300 1.0 Technical Services Graphics Tech 21,50 22,800 0.5 Training Battalion Chief(see note) Trainine 20,000 Total 600 375 , : ....... .:394 100 4:8. .tion 7. 92% .0%: 7%:1.: NOMS. 1. There are currently Only two firelighter vacancies,but one additional position is about to disability retire. Z There are currently no Battalion Chief vacancies,but one incumbent is about to service retire. �TOTAL ... >`: > 189`800 30 0 .. 1868`800 .. .. ....... . .Percent: eductiow: 10.8%1 ............ MTN 5 CITY CLERK MEMORANDUM r .....::.::::.............::.......:....,:.::............. :.:::.: ::.:..........:.......................:.:.:.............. ... ...,.::: :. ::..::::........:. ........ .............. 0-1 x.........:. ........:::::::........ :...:.:. ti2r �'< (' '$ '> ;>;�;;;;;;; '; '#�� r :i1.2:::::::::::::'::ri,2::i::s: ::::_:: ;i:::i::: : 2. February 23, 1993 TO: John Dunn, City Administrative Officer FROM: Diane Gladwell, City Clerk SUBJECT: Approach to Budget Cuts We applied the same budget development approach to all three budgets. Records Administration and Elections The City Clerk and Assistant City Clerk generated a draft budget. Layoffs and cutbacks were determined with the goal to position the department to best serve the communities' needs in the future. We chose not to fund the election in off-years, returning $26,600 to the general fund. The impacted members of staff were told privately of the recommendation where a lay-off or cutback in hours was recommended. The draft was then opened for discussion and input to the department and discussed at a staff meeting. Options presented last year by Hughes, Heiss and Associates were incorporated based upon the necessity to reduce our staff by one to meet target cuts, and include implementing a volunteer program. Other recommendations have been put in place, but some (including a records management program) would not be able to be provided under these cuts. Staff reductions in this report were based upon divesting responsibilities to other departments or eliminating highly-valued services (from the public's perspective), which I have not incorporated in my recommendations. City Council The Council budget was developed with the Assistant City Clerk and Council Secretary, then discussed with each Council Member before recommendations were made. 6 COUNCIL BUDGET PROPOSED CUTS FOR FISCAL YEAR 93-94 16,200 9,700 Budget Cut Cut By State Account 92-93 Net Impact Take-Aways Net Impact Salaries 62,800 82,800 82,800 Stationary 1,000 500 500 no Council stationery 200 300 moderate use City stations Impact inting 3,700 1,700 2,000 smaller quantity 530 1,470 restrictive printing of printed material policy iCeSupplies 3,000 1,200 1,600 minor Inefficiencies 400 1,400 defer In process purchases ublications 900 400 500 combine or forego 100 400 some Rublicatiorts nntmg Contracts 3,800 800 3,000 smaller quantity 200 2,800 reeVietrve panting of printed material policy adio Ad 6,200 2,400 8,600 broadcast adjourned 8,600 (add') meetings Council Meetings 3,500 1,500 2,000 major reduction in 500 1,500 further reduction snacks&meals in meals Advisory Boy Meeting 4,500 2,500 2,000 ow-cost 1,500 500 recognitions (includes 5200+/yr for dinner only/quarterly quarterly AB Mtgs.) meetings League Peg Pinard :;3.0002,000 750 100 650 Dave Romero 750 reduce expenses 100 650 combine travel Allen K.Settle 750 100 650 Penny Rappa 750 100 650 Bill Roalman 750 100 650 trips and Meetings 1000 shift burden Soo 500 shift burden to other to other accounts accounts ro. ev.(out -county) 30 cut 80 cut Peg Pinard 1,600 540 1,260 reflects 900 360 shRtto Dave Romero 1,500 450 1,050 average 750 300 lr•Courrty Allen K.Setae 1,500 450 1,050 historical 750 300 expenses Penny Rappa 1,500 450 1,050 spending 750 300 Bill Roalman 1,500 450 1,050 750 300 Mileage SO%cut 80%cut Peg Pinard 1,000 500 S00 300 200 use Dave Romero 400 .200 200 120 110 City vehicles Allen K Settle 400 200 200 120 80 when possible Penny Rappa 400 200 200 120 80 Bill Roalman 400 200 200 120 Bo Misc.Prof.(in-county) 25 cut 40%cut Peg Pinard 1,800 450 1,350 reflects 270 1,080 Dave Romero 1,200 375 825 historical 105 720 Allen K Settle 1,200 375 625 spending 105 720 Penny Rappa -" 1,200 375 625 105 720 Bill Roalman 1,200 375 825 105 720 tart-Up 1,000 1,000 1,000 (Finance omitted) TOTALS 136,600 16,240 120,360 9,800 110,560 MEMORANDUM February 12, 1993 TO: John Dunn, City Administrative Officer FROM: Ken Hampian, Assistant City Administrative Officer SUBJECT: Total Cut Solution Submission Attached are the cuts identified as a part of the 'total cut solution" exercise for programs organized under the "Administration" program. In terms of the process used to identify these reductions, the Administration operation budget (staff/services and supplies) was dealt with separately from the various programs managed by Administration (HRC, PCC, and Economic Stability). Thus, reductions in the Grants-In-Aid programs, for example, could not be used to serve as the proposed reductions for the Administration operating program and vice versa. With regard to the Administration Department staff and operating program, given the required reduction amount, and prior cuts, there was basically no alternative other than to reduce staffing by one Administrative Analyst. In making this reduction, and given the recent transfer of the Transit Division, a reduction in the Administrative Secretary position to half time is also identified. Together, along with the elimination of the newsletter, these two reductions meet the target at the $4 million level. With respect to the Administrative Secretary position, an alternative to this reduction would be for Administration to absorb Council secretarial support, albeit at a reduced level from the current arrangement (approximately one-half time versus full-time). Another possibility: If an economic stability position is eventually created under the CAO, then I would reverse this recommendation, since two full secretaries would be essential to reasonably support the office. With regard to the newsletter, and although it is a valuable public relations tool, the loss in both production and staff time is just too high, if the second Analyst position is eliminated. In terms of the other programs, there are essentially two options offered: First, there are reductions equivalent to the target amounts identified in the 'total cut solution" exercise; second, there is an option that outlines reductions that go beyond only the target levels, given the somewhat discretionary nature of these programs. Discussions with employees who may be affected by the reductions occurred almost immediately after the total cut solution exercise was assigned. Both Administrative Analysts also reviewed the attached material prior to submission. cut.mem s ADMINISTRATIVE OFFICE BUDGETS 1993-95 Target Budget Reductions Option 1 Option 2 Option 3 $2.5 Million $4 Million Target Target Target Administration $ 59,000 $ 94,400 $94,400 Human Relations 24,150 38,600 49,700 Community Promotion 27,370 43,790 52,000 Cultural Activities 9,660 15,410 33,755 Economic Stability 19,320 31,000 67,000 Total $139,500 $223,200 $296,855 Option 1 - $2.5 Million Target Reductions Under Option 1, Administration has prepared budget reductions that meet the targets established for the $2.5 Million Target Reduction scenario. The Department's overall target at this level is $139,500 and can be met with the following proposed reductions: ■ Administration (Target: $59,000) - This will result in the elimination of one Administrative Analyst position ($57,000) and a 20% reduction in various operating accounts ($2,000). If a full-time Analyst position is eliminated, the CAO's Office will lose 25% of its professional staff. Therefore, the office will be unable to maintain the same level of staff support now provided, with some level of reduction expected in the following four areas: (1) coordination of the citywide customer relations program; (2) HRC and PCC support; (3) legislative advocacy; and (4) special projects. The loss of an Analyst position will also have an impact on the level of time the City Administrative Officer and Assistant City Administrative Officer can devote to organization-wide issues, since reduced staff support will inevitably require a greater proportion of their attention to be diverted to "project issues". Examples of expected reductions include: (1) reducing the number of publications or eliminating the City Lights newsletter (we will explore other options, such as integrating with recreation publications, or persuading the TT to print an occaisional "City Column"); (2) disbanding the Customer Services Working Group, and depending more on individual departmental efforts; (3) focusing legislative advocacy efforts on only a few very high priority issues; (4)transferring support for special ceremonies to the Council Secretary; (5) issuing fewer press releases and reducing some other public information activities; and (6) taking on fewer special projects. .g Page 2 Target Budget Reductions In addition, with only one analyst, it will not be possible to support the Promotional Coordinating Committee and Human Relations Commission at the same level without neglecting important organization wide issues (e.g. budget, productivity reviews, cable television, smoking ordinance administration). Thus, staff could explore limiting meetings to quarterly as opposed to monthly. This can only be done by reducing the scope of both commissions in some manner (the commissions will be consulted prior to recommending an approach). If, however, the City eventually staffs an Economic Stability Program, then staffing of the PCC could be transferred to that program. Staff support to the HRC could be transferred to the Personnel Department, and maintained near the existing level. This latter approach will be pursued initially. ■ Human Relations (Target: $24,150) - This will result in a 10% reduction ($12,000) to the City's contribution to the Homeless Shelter and a 17% reduction ($12,150) to the Human Relations Commission's Grants-In-Aid Program. If the City's contribution to the Homeless Shelter is reduced by 10%, it is likely that the County will reduce their contribution toward homeless programs by a similar amount. The City and County have always "unofficially" contributed like amounts of funding for homeless programs- although -the County divides their contribution between the Homeless Shelter ($95,000) and the Salvation Army ($25,000). In order to absorb this type of funding loss, the Shelter will have to consider service level reductions on the level of reducing the number of hours the Shelter is open each week (e.g., not opening until 8:00 pm as opposed to 4:00 pm), eliminating the dinner meal, etc. Reducing the Grants-In-Aid Program by 17% will leave $72,550 available for allocation (down from $84,700). ■ Community Promotion (Target: $27,370) - This will result in across-the-board- reductions of 13.5% (or $27,370) to contracts with the Chamber of Commerce, Visitors and Conference Bureau, and Barnett, Cox & Associates to carry out the City's Community Promotion Program. Assessing the impact of this reduction is difficult to quantify - however - examples of the types of reductions that could take place include such things as reducing the Visitors Center's hours of operation, charging for promotional literature requested by tourists, and reducing promotional advertisements in major publications, etc. 10 Page 3 Target Budget Reductions ■ Cultural Activities (Target: $9,660) - This will result in a 15% reduction ($9,660) to the Promotional Coordinating Committee's Grants-In-Aid Program. Reducing the Grants-In-Aid Program by 15% will leave $66,095 available for allocation (down from $75,755). ■ Economic Stability (Target: $19,320) - This will result in a 13% reduction (leaving approximately $147,000) in "seed monies" available to support an enhanced economic stabilization program in 1993-94. Option 2 - $4 Million Target Reductions Under Option 2, Administration has prepared budget reductions that meet the targets established for the $4 Million Target Reduction scenario. The Department's overall target at this level is $223,200; our reductions total $227,800 and can be met with the following proposed reductions: ■ Administration (Target: $94,400 / Actual: $99,000) - In addition to the $59,000 in savings identified in Option 1 (eliminating a full-time Analyst and $2,000 in other operating expenses), this option will reduce an Administrative Secretary from full- time to half time ($20,000) and eliminate the City Lights Newsletter ($20,000) for a total of $99,000 in reductions. With the loss of an Analyst (as outlined in Option 1) and the transfer of the Transit Manager to Public Works (which has already taken place), a half-time Secretary position to support the Assistant Administrative Officer and remaining Analyst position should be possible, with some occaisional assistance from the CAO's Secretary. However, less than half-time support would not be possible. Eliminating the City Lights Newsletter will reduce the City's ability to conveniently communicate information to our residents, causing the City to rely more heavily on the local news media, unless reasonable alternatives to City Lights can be identified, as noted earlier. ■ Human Relations (Target: $38,600) - This will require the City to reduce its contribution to the Homeless Shelter by a total of $19,225 (or a 20% reduction overall) and its Human Relations Commission Grants-In-Aid Program by a total of $19,375 (or a 30% reduction overall). With respect to the Homeless Shelter, funding losses at this level will result in a greater eroding of the services provided to the homeless. Specifically, the Shelter (assuming the County reduces its contribution also), will be forced to consider 11 Page 4 Target Budget Reductions options for further reducing hours of operation, abandoning some neighborhood relations commitments, and searching for other revenue alternatives. Reducing the Grants-In-Aid Program by 30% will leave $65,325 available for allocation (down from $84,700). ■ Community Promotion (Target: $43,790) - This will result in across-the-board- reductions of 24% (for a total of $43,790) to contracts with the Chamber of Commerce, Visitors and Conference Bureau, and Barnett, Cox & Associates to carry out the City's Promotional Program. Again, assessing the impact of this reduction is difficult to quantify - however - examples of the types of reductions would include more drastic versions of the reductions listed under Option 1. ■ Cultural Activities (Target: $15,410) - This will result in a 26% reduction ($15,410) to the Promotional Coordinating Committee's Grants-In-Aid Program. Reducing the Grants-In-Aid Program by 26% will leave $60,345 available for allocation (down from $75,755). ■ Economic Stability (Target: $31,000) - This will result in a 23% reduction (leaving approximately $136,000) to monies available to support economic stabilization activities in the City. Option 3 - Additional Alternatives Option three represents an alternative for the City Council to consider in addition to the formal target budget reductions outlined above. This alternative represents the maximum reductions that Administration and its associated programs could "weather" and still maintain the basic core services and programs it provides. Under this alternative,the City could save a total of $ 296,855 annually by making the following reductions: ■ Reducing Administration's Budget as outlined in Option 2 (Total Savings: $99,000) - This includes elimination of: a full-time Analyst position, a half-time Secretary position, the Newsletter and $2,000 in other expenses. ■ Reducing the Human Relations' Budget by an a total of $49,700 - Under this alternative, the City would reduce its Homeless Shelter contribution to the County's actual contribution level of$95,000 (representing a$25,000 or 26% reduction) and • Grants-In-Aid Program funding to $60,000 (down from $84,700). 12 Page 5 Target Budget Reductions The impact of this alternative is slightly more severe than the version outlined in Option 2. However, it basically represents the most extreme reductions the Homeless Shelter and Grants-In-Aid Programs could endure without significant program alterations. ■ Reducing the Community Promotion Budget by a total of$ 52,000- Under this alternative, the City would eliminate the promotions contract with the Chamber of Commerce ($32,000) and make across-the-board reductions of 10% ($20,000) to the remaining Community Promotion Program contracts. Under the City's current contract with the Chamber of Commerce for promotional services, the Chamber devotes staffing to generating free publicity for the City-the value of which should exceed contract expenses. As an example, instead of paying for an advertisement in Sunset magazine, the Chamber would persuade Sunset to include a story featuring San Luis Obispo in an upcoming magazine. The Chamber is able to accomplish this through providing the magazine with appropriate contacts, background materials and photographs - in essence - making it at easy and attractive as possible for a reporter to write a story. The Chamber then provides a monthly report to the Promotional Coordinating Committee summarizing their efforts and results. Eliminating the promotional contract would reduce the Chamber's ability to promote the City to the degree that it has over the last several years. However, given the nature and duties of the Chamber, it is likely that a reasonable level of promotion would continue even without City funding. Therefore, elimination of this contract in combination with 10% across the board reductions to the remaining contracts represents the maximum reductions that could be endured by the Community Promotion Program without drastically altering its basic goals. ■ Reducing the Cultural Activities Budget by a total of $33,755 - Under this alternative, funding for the Promotional Coordinating Committee's Grants-In-Aid Program would be reduced to $50,000 (down from $75,755). Again, this alternative represents the maximum reduction the cultural activity grant program could endure and still maintain the basic goals of the program. ■ Reducing the Economic Stability Budget by a total of $67,000 - Under this alternative, there would still be approximately $100,000 available as economic stability "seed money" for 1993-94. I:bud-tar 13 MEMORANDUM FROM THE OFFICE OF THE CITY ATTORNEY February 11, 1993 TO: John Dunn FROM: Jeff Jorgenseff SUBJFCT: "Total Cut Solution" Assignment Attached for your consideration is the "total cut solution" assignment for the City Attorney's Office. In addition, at the February 5, 1993 Management Team meeting, you requested a description of the process used by our office to accomplish the assignment. A brief summary follows. After thorough discussions with my staff about the scope of the financial crisis facing the City, and the requirements and ramifications of the "total cut solution" assignment, I solicited from them their comments, suggestions, alternatives and any other information they considered important to completion of the task. Based on the responses provided, and my own investigation and analysis, I prepared a discussion draft for further review and requested my staff to provide additional comments, suggestions, and alternatives. As a result of further discussion with them, a final proposal was developed. JGJ/sw attach. t 14 CITY ATTORNEY 'ENUE EXPENDITURE GAP Regular Annual Program/Description Staffing Savings LEGAL SERVICES Assistant City Attorney Reduce Assistant City Attorney to half-time .425* $29,300 SERVICE IMPACT: Representation at meetings and advice to Planning Commission and Personnel Board will be eliminated. City Attorney partici- pation in criminal prosecutions (i.e., noise ordinance) municipal code enforcement (i.e., high occupancy residential, nuisance abatement, building code), and collections (i.e., business tax) will be greatly curtailed or eliminated. City Attorney support to risk management activities will be greatly curtailed. TOTAL REDUCTION .425* $29,300 *NOTE: Because there are only three employees in the department; there is very little flexibility in making personnel reductions. Because a legal secretary is essential to the proper functioning of the office and the City Attorney is directly appointed by the City Council,the only available option if across the board reductions are not allowed is a reduction to the Assistant City Attorney position. . While a reduction of the Assistant City Attorney position.to half-time is shown here for the purpose of meeting the theoretical requirements of the "total cut solution," it is not a feasible alternative because: reduction to half-time will have the practical effect of eliminating the position entirely. The total compensation for. the position; (salary and all benefits) is approximately $33.00/hour. The incumbent will not remain in a half-time position at this level of compensation, and it will not be possible to recruit a new assistant on a half-time basis when the compensation.is less than the salary. for a beginning paralegal (and without any benefits). If required, the equivalent or a half-time. position reduction.. can. be accomplished through an across-the-board reduction in hours for all employees in the City Attorney's Office, with the impacts noted above. There is a unanimous commitment by the Department to the . concept of an across-the-board reduction should it be required. 15 CITY ATTORNEY rE TAKE-AWAYS Regular Annual Program/Description Staffing Savings LEGAL SERVICES Assistant City Attorney Eliminate Assistant City Attorney Position 680* $46,900 SERVICE IMPACT: Access to the City Attorney's Office will be sharply limited. Response to public requests for information will be minimized. Participation at management team meetings will be reduced. Requests for legal opinions will be accepted only by formal written request from department heads, and limited to critical requests only. Response time will be significantly delayed and greater reliance on office automation devices such as voice mail will be required. Representation of City departments in personnel matters will be sharply limited. TOTAL REDUCTION .680* $46,900 *NOTE: The.680 position reduction target effectively means.the elimination of the Assistant City Attorney position.sin. there are only three employees in the office aad therefore no t]exibiLty to ma further personnel reductions without crippling the Departmen77.t 16 CITY CLERK MEMORANDUM ..........:.............,:..:......o...........................................................,:.:.:......,.............. .. ::::::.�.:...:................u::.:.. ,:. ...: February 23, 1993 TO: John Dunn, City Administrative Officer FROM: Diane Gladwell, City Clerk " 0 SUBJECT: Approach to Budget Cuts b We applied the same budget development approach to all three budgets. 11,11, 1111.11 Records Administration and Elections The City Clerk and Assistant City Clerk generated a draft budget. Layoffs and cutbacks were determined with the goal to position the department to best serve the communities' needs in the future. We chose not to fund the election in off-years, returning $26,600 to the general fund. The impacted members of staff were told privately of the recommendation where a lay-off or cutback in hours was recommended. The draft was then opened for discussion and input to the department and discussed at a staff meeting. Options presented last year by Hughes, Heiss and Associates were incorporated based upon the necessity to reduce our staff by one to meet target cuts, and include implementing a volunteer program. Other recommendations have been put in place, but some (including a records management program) would not be able to be provided under these cuts. Staff reductions in this report were based upon divesting responsibilities to other departments or eliminating highly-valued services (from the public's perspective), which I have not incorporated in my recommendations. City Council The Council budget was developed with the Assistant City Clerk and Council Secretary, then discussed with each Council Member before recommendations were made. 17 CLERK BUDGET-RECORDS ADMINISTRATION PROPOSED CUTS FOR 93-94 Budget 40,400 24,300 Account 93.94 Cut Net Impact Cut Impact SALARIES w/benefits Secretary 1 34,186 34,186 Assistant City Clark 46,509 46,509 City Clerk 65,132 65,132 Office Assistant 31,847 31,847 Office Assistant II 33,572 33,572 0 mass mailing delays/volunteer needed staff absorbs job duties may slow response to copies/info no minutes for study sessions Council Secretary 40,927 40,927 5,550 work week reduced to 35 hours SUBTOTAL 252,173 33,572 218,601 5,550 Postage 450 350 100 50 Stationery 700 400 300 Printing Supplies 600 600 300 Office Supplies 3,200 3,200 500 Publications 700 400 300 150 Computer Supplies 2,400 400 2,000 no newprogram/upgrade purchases 1,500 equipment breakdowns not repaired Office Equipment 0 SUBTOTAL 8,050 1,550 6,500 2,500 Printing Contracts 4,200 1,200 3,000 reduced information In agenda packet 350 reduce again copyingb staff In-house Advertising 21,750 21,750 1,000 smaller display advertisement Equipment 1,800 600 1,200 attempt repairs in-house if possible 600 no maintenance contracts Maintenance I rotation/sharing of equipment Secretarial Swv. 3,000 add 8,50 9,500 paid volunteers/temporary help 9,500 all in-house Contract Services 3,850 3,950 0 M icrolilming 4,500 1,500 3,000 defer some record series 2,000 film vital records only SUBTOTAL 39,200 7,250 38,450 13,450 Professional Orgs. 400 100 300 only Clerk/ACC retain memberships League Convention 1,300 600 700 700 do not attend League Convention Professional Cont. 3,540 1,740 1,800 only Clerk attends CCAC,IIMC Confs. 1,800 Ino conferences Commission/ 380 380 0 Committee Mtgs. Trips 8 Meetings 1,400 1,000 400 attend Gold Coast meetings only no trins SUBTOTAL 7,020 3,820 3,200 Municipal Code 6,700 700 6,000 TOTAL 313,143 40,392 272,751 24,300 18 CLERK BUDGET-ELECTIONS PROPOSED CUTS FOR 93.94 Budget Recommend 24,300 94-95 Account 93.94 Cuts* 93.94 Cut Impact Requirement Salaries(romps) 3.000 3,000 3,500 Postage 5,000 5,000 1,600 Printing Supplies 8.200 7,900 400 Office Supplies 1,100 850 250 no supplies 250 Publications SUBTOTAL 14,300 Printing Contracts 1,000 add 500 800 reduce candidates'nomination information 17,500 Contract Labor 6,000 Contract Services 7,550 7,550 1,000 Microfilming 1,000 1,000 300 Micellaneous Expenses 500 200 200 300 SUBTOTAL 10,050 Professional Or s. 600 450 150 rely on Clerks'organizations 150 League Convention 0 0 0 Professional Confs. 1.720 1.000 300 double up on accomodations,etc. 1,000 Trips&Meetings 400 200 200 200 SUBTOTAL 2.720 TOTAL 30,070 26,650 1,900 32.200 'these reductions were not counted toward the 40,400 goal. 19 MEMORANDUM March 1, 1993 TO: John Dunn FROM: Ann Slate 0 SUBJECT: Total Cut Solution Process - Personnel Department The first objective in the Total Cut Solution process was to identify and prioritize Personnel programs and responsibilities. This included participation from our mid- management level, review of our Mission Driven Service Levels report and current budget expenditures to date. The next priority was determining how to best maintain and deliver the services required of the Personnel Department. Discussions focused on a realistic review of historical spending and what I visualize our future work load to be. As an example, the next several year are highly impacted by the number of required MOA negotiations, ADA compliance and a predictable increase in the number of grievances. Another review of the Wellness Program reinforced our decision that although staffing will be cut, a significant effort will be made to retain part of the program because we feel, from a risk management perspective, the program has a O very positive impact on city employees. Realizing we are a highly visible support department, every effort was made to make cuts that had the least impact on the level of services delivered to all departments and not preserve programs we, as a department, individually held to be priorities. O 20 PERSONNEL DEPARTMENT BUDGETS 1993-95 Target Budget Reductions Option 1 Option 2 $2.5 Million $4 Million Target Target Staffing $44,700 $63,900 Contract Services 16,500 Claims 14,900 14,900 Target $59,600 $95,300 DESCRIPTION OF IMPACTS Option 1 - $2.5 Million Target Reductions At the $2.5 million reduction scenario,the Personnel Department proposes reductions in the Wellness Program in Staffing of $44,700 and in the Risk Management Program in Claims of $14,900. ■ STAFFING Eliminate the Work Health Coordinator Position (Target: $44,700) The Department recommends the elimination of the Work Health Coordinator Position which would result in a budget reduction of $44,700, or 60% of the total Wellness Program budget. The Wellness Program could be continued by shifting the duties of the Coordinator to other regular staff and enlisting additional support from Cal Poly internships. This represents a return to the level of staffing devoted to Wellness when it was originally developed in 1987.: Specific responsibilities in the areas of safety training and wellness counselling would be assigned to the Personnel Analyst with the associated clerical tasks being assumed by the Personnel Assistant II and the Executive Secretary. Assistance with Wellness Testing would be provided by Cal Poly students majoring in Corporate Fitness serving as interns. Even with the reassignment of Wellness duties to other staff, some loss of continuity and program effectiveness can be expected due to the loss of the highly specialized professional resources and expertise the City has devoted to its Wellness Program. Those responsibilities related to the Fire Department Fitness Program would be absorbed in part by the Personnel Department and on-duty Fire Department staff. Although the Personnel Analyst will have some time available due to anticipated reductions in recruitment and selection activity, she will be 21 confronted with the significant workload that ADA compliance presents as well as the various other Wellness and training responsibilities that will be transferred to the her. ADA compliance has been assigned to the Personnel Department. Reductions in Building Division staff as well as other affected Departments will shift a greater burden onto the Personnel Analyst that will more than compensate for any reductions in workload caused by fewer recruitments. Significant decreases in workers' compensation claims in the Fire Department over the past few years are in part attributable to the effectiveness of their fitness program. Because the Department's commitment to safety and fitness continues to be a very high priority it is not anticipated that workers' compensation costs will be adversely affected by the elimination of the Work Health Coordinator. There will be some loss in the Personnel Department's ability to provide fitness training to employees which addresses specific problem areas. For example, currently offered is individualized training for employees who return to work after a worker's compensation injury, back classes, carpal tunnel prevention classes, etc. Without this type of aggressive prevention program, there may be an increase in cumulative trauma type workers' compensation claims. Since the Health Fitness Coordinator also provides significant support to the City's Safety Program as required by SB 198; the Risk Manager will now have O to assume responsibility for developing and implementing all new safety policies and required record keeping. The Work Health Coordinator also is responsible for updating and creating all Codes of Safe Practices and ordering all safety and wellness educational materials. Again, these duties would be assumed by the Risk Manager. Additionally, the Work Health Coordinator is responsible for coordinating the Bloodborne Pathogens Exposure Program which will have to be taken over by the Risk Manager. Without the Work Health Coordinator's support for the Safety Program, the Risk Manager's responsibilities will be spread even thinner and her ability to address all the requirements of the Risk Management program will diminish. Increases in meet and confer activity resulting from not only the current trend of shorter term contracts and the increased frequency of formal negotiations but also the implementation of layoffs and required impact bargaining. The management staff of the Personnel Department will be faced with significant workload increases due to negotiating "around the clock." It is conceivable that after the City organization is "right sized", labor relations stabilize and ADA compliance has been accomplished that further reductions to Personnel staff may be warranted. However, this would most likely be identifiable during the second year of the upcoming financial planning period. O 22 ■ CLAIMS Risk Management Insurance Premiums (Target: $14,900) If we discontinue the direct City payment of property damage claims under $500 and instead instruct Carl Warren Company, our insurance adjuster through the JPA, to pay all claims, this account can be eliminated. This is in actuality a cost shifting strategy and not a true elimination of an expenditure. Additionally, the City some time ago eliminated a deductible repayment program which served as the genesis for this account. This, along with the implementation of an aggressive sewer maintenance program causing claims costs to fall under $3,000 per year, will have minimum impact on our liability claims deposit with the JPA. Option 2 - $4 Million Target Reductions In order to reach the targeted amount as posed in the $4 million reduction scenario, additional reductions in Staffing of $19,200 and Contract Services of $16,500 are necessary to meet the departmental target of $95,300. ■ STAFFING Personnel Assistant II (Confidential) position is reduced to a half-time position. (Target: $19,200) Currently the Personnel Assistant II reports to a Personnel Analyst and performs clerical functions in support of recruitment activities, maintains employees' personnel files and required records, answers the main telephone line, provides counter assistance to the public, operates the Sigma applicant tracking system and processes Special Events insurance. Reducing this to a half-time position will have an impact on the workload of the Executive Secretary and the Personnel Analyst. The Executive Secretary, in addition to her considerable risk management and claims support duties and clerical backup for meet and confer activities, will assume the remaining receptionist and records maintenance duties. The Risk Manager and Director who rely upon the Executive Secretary for clerical support will be unable to delegate as much secretarial work and will perform their own clerical tasks at a much higher level than they are currently. Since the services provided by the Personnel Department are by their very nature management support services, i.e., human resource management, the option of reducing mid-management staff to meet this target is not 23 recommended. Those tasks currently performed by the Department's management personnel which consists of a Personnel Analyst, Risk Manager and Department Director, are highly technical, and professional level and are not within the scope of the clerical staff to perform. On the other hand, the clerical staff in the Personnel Department, whose primary responsibilities are in support of the management staff, have duties that can be assumed by the other staff. The Personnel Department, unlike the some of the other City departments, has a management staff that possesses clerical skills and is accustomed to using them. The reduction in staffing as proposed to meet the $4 million target will have the least impact on the community the Department serves, not only externally but also internally. To minimize workload impacts resulting from staffing reductions, the department will schedule the half-time position to coincide with the busier hours at the counter. The Department can anticipate that recruitment-related correspondence will be slower and filing will be difficult to maintain at the current level placing a greater burden on meeting statutory guidelines for workers' compensation and liability claims administration. ■ CONTRACT SERVICES (Target: $16,500) By reducing expenditures by 26% in Contract Services, an additional $17,500 can be realized. The Department has already experienced a reduction in O recruitment activity due to hiring freezes and can continue to expect a decline in recruitment simply due to reducing staff City wide. Therefore, impacts will be minimal, specifically in the areas of Printing and Reproduction Contracts (typically the professional brochures we produce for management positions), Advertising, and Personnel Services (assessment centers and commercial testing services). As part of the reduction in Contract Services, the Personnel Department is recommending the discontinuation of Pre-Employment medical examinations for sedentary classifications. Such examinations would be continued for those positions that have significant physical ability requirements, (all safety and manual labor classifications). By requiring new employees to complete a health history questionnaire,the City can minimize its exposure to risks arising from employees who have pre- existing industrial injuries or disabilities. This change in practice would decrease the number of medical examinations by 44% for a savings of $5,000, and like our past policy is in compliance with ADA. As stated above, the Personnel Department will be heavily involved in 24 negotiations with all bargaining units during the next year. Short term contracts which represent a significant departure from prior City practice of long term MOA's with longer period of "labor peace" have become necessary in this current unstable fiscal environment. To meet this target, reductions in the use of a professional negotiator is proposed. Although the negotiator will be retained for those negotiations involving Police and Fire Associations who also use professional negotiation services, a negotiator will not be used in any other negotiations nor in any ad hoc advisory capacity. There will be a greater reliance on existing City staff and the advantage of outside perspectives, and familiarity with successful solutions implemented in other agencies will be diminished. _ 1 25 MEMORANDUM February 11, 1993 TO: John Dunn, City Administrative Officer FROM: William C. Statler, Director of Financeo�/ SUBJECT: TOTAL CUT SOLUTION FOR THE DEPARTMENT OF FINANCE OVERVIEW This memorandum transmits to you the "total cut solution" for the Department of Finance. Given our current financial situation, it is highly likely that some, if not all, of the service/expenditure reduction options presented in this report will be implemented as part of the 1993-95 Financial Plan. Of necessity, then, I have strived to present options that are "doable". However, it is important to note that even though they are "doable", they will result in significantly reduced service levels to the community as well as to the organization. They will also weaken our internal control systems: more errors will be made, more of them will go undetected, and we will have limited ability to correct them when we do find them, let alone develop and implement systems that will prevent them from occurring in the future. We will simply have to accept a higher level of uncertainty in this area. But this is not necessan7y bad For example, changing the kinds of services and the ways we provide them may not mean O a reduction in service, but simply a redefinition of an equal but different level of service - one the customer (both internal and external) may actually believe is better than the one they're getting now because it removes a layer of administrative infrastructure (ie, red tape) that doesn't have a commensurate level of value-added. In terms of internal control, we need to recognize that we don't have a perfect system now, and we'll simply have a less perfect one in the future. We need to be realistic - no internal control system can provide absolute assurance that an organization's assets will be safeguarded against unauthorized or inappropriate use. Because of this, it is a basic tenant of internal control principles that management must make judgements regarding the relative value of an internal control practice and its related cost. In our case, there probably won't be any significant monetary costs associated with the proposed reductions in our management and internal control abilities. On the other hand, we need to realize that financial operations are typically transaction rather than dollar driven, and mistakes that result in a $10.00 loss or error are often the same kind that can result in a $100,000 error (it's just a few zeros and decimal points away). So what wiH we lose with these cuts? We will not lose our basic ability to issue bills, take in payments, make bank deposits, process invoices, issue financial reports, pay employees, or reconcile bank statements. LAN's will operate, computers will turn-on, copies will be made, and phones will ring. All of our "core" services will remain in tact. 26 We will lose (at.least in the interim) our current bias for excellence - to constantly seek out better and new ways to do things in improving service to our customers. Will this bias for excellence return? Of course, because I believe it is our organizational nature to do so. But first we have to make the difficult decisions ahead of us - and the sooner we can do this, the sooner we can return to our commitment to "continuous quality improvement". The Council needs to act soon and decisively in order to get these issues behind us so we can focus our efforts on the organization we want to be in the future, instead of dwelling on the organization we were in the past. PROCESS In response to your request, the following is an overview of the process used in developing the "total cut solution" for the Department of Finance: ■ Department Management Staff Briefing After receiving the CAO's memorandum directing the preparation of General Fund service/expenditure reductions totalling$2.5 and $4.0 million, I met with department management staff to brief them on the assignment and to solicit their views on the process we should use in arriving at these reductions. It was our goal to involve the entire department to the maximum extent possible in this process. Rather than decide this process ourselves,we agreed it would be better to ask the staff themselves how they would like to be involved. ■ Department-wide Briefing No. 1 Shortly after the management staff briefing,we held a department-wide staff meeting to discuss the City's fiscal situation in general, the CAD's eight point budget strategy, our department's reduction target, and how the staff would like to be involved in developing these reductions. I made four points clear at this point: the exercise was a difficult but necessary one; I wanted the involvement of all staff members to whatever degree they were comfortable in participating; I would be consulting with department managers in preparing my recommendations; but the final recommendation to the CAO would be my responsibility. After discussion, we agreed to get back together as a group within a week to discuss what the process should look like. ■ Department-wide Briefing No. 2 Within one week from our first briefing, the staff got back together to discuss the process. There was general consensus that the process for involving the staff would have two major components: 1. Individual staff members would submit their recommendations to me in writing within one week. These could be anonymous, and did not have to address all four regular position reductions - any level of suggestions would be helpful to me. Impacts and recommendations for mitigation would be included in the submittals. 2. After receiving the recommendations, I would summarize them,and we would get back together as a group to discuss them. 27 ■ Department-wide Briefing No. 3 As agreed, I prepared a summary of the written suggestions I received (Attachment A). Before discussing them, I outlined what my goals were - and weren't - for this meeting: Were: to present a summary of the submittals, to discuss their impacts, and to ensure that I fully understood what was being recommended. Were not to try to reach consensus on them, vote on them, or in any way make decisions as a group. As stated earlier, this would be my responsibility - after thoughtful consideration of the advice provided to me by the staff and consultation with department managers. Within this context, the staff's recommendations and their impacts were discussed. I also answered a number of questions regarding what the rest of the budget process would look like, and I stressed the importance of the March 13 Council meeting in making difficult decisions and setting budget direction. ■ Budget Meeting with Division Heads Following the third department-wide briefing, I met with the three division heads (Accounting Manager, Revenue Manager, and Information Systems Coordinator) to solicit their views and advice. ■ Final Recommendation to the CAO After considering the advice of all department staff members as well as consulting with others in the organization, and after a great deal of personal thought and discernment about the Department's current resources and its mission, goals, and values, I arrived at the recommendations contained in this report. I have met personally with the staff members directly affected by this recommendation, and a copy of this report has been distributed to all members of the department as requested by them. SUMMARY OF RECOMMENDATIONS Recommended service/expenditure reduction options along with their impacts are presented in Attachment B. These options total $189,900 and reflect cutting four regular and two temporary positions. Our "total cut solution" target is $118,700 at the $2.5 million General Fund level and $189,900 at the $4.0 million General Fund level. These reductions are balanced both programmatically (all three program areas are affected - accounting, revenue management, and information systems) and organizationally: taking into consideration recent Council action to eliminate the Support Services Manager position, these options represent a 33% reduction in mid-manager staffing and a 30% reduction in our clerical/technical staffing. ATTACHMENTS A. Summary of staff suggestions B. "Total Cut Solution" for the Department of Finance 93-9581\DOFTOTAL.WP 28 Potential Regular Position Reductions Attachment 'Total Cut Solution' DEPARTMENT OF FINANCE Z6193 The following summarizes recommendations submitted by Department of Finance staff regarding regular positions that should be reduced as part of the Department's"total cut solution." Following a process agreed upon by the staff themselves at a departmentwide meeting,these suggestions were submitted to the Director in writing. It was agreed at this meeting that the recommendations could be anonymous,and did not have to address all four position reductions necessary to meet the department's reduction target— any level of suggestions would be helpful. Of 14 regular employees(excluding the Director), 12 suggestions were received. These suggestions were discussed by the group at a follow—up meeting. Although the final recommendations to the CAO are the sole responsibility of the Director,these suggestions were seriously considered by the Director,and along with consultations with department managers and others in the organization,were significant factors in the final recommendations. Posrtton Im act/Comments Computer Systems Tecbnician ► Plan&execute fewer special projects w Shift more"hands—on"work to Information Systems Coordinator W Current system,although not perfect,is better than it has been without an additional support position Customer Services Supervisor/ Plan&execute fewer special projects Accounting Supervisor 0- Accept lower level of customer service improvements W Reduced quality control 0- Shift more"hands—on"work to Revenue and Accounting Managers Information Systems Coordinator r Plan&execute fewer special projects;there won't be funding for any new major system improvements anyway .► Reduced planning&organization capability .► Reduced in—house professional advisory capability Administrative Secretary r I Reduced level of administrative support to the Director&department as a whole Amounting Assistant/ W Plan&execute fewer special projects Account Maintenance W Accept a less than perfect world 0- Limit improvement changes W Reduced level of financial reporting services to the operating departments Accounting Assistant/ W Shift reponsibilites to other desks General Accounts Receivable 0- Bill TOT quarterly 0- Purchase A/R sotware for LAN's and decentralize invoice preparation to operating departments 0- Transfer utility bill responsiblity from the customer to the property owner. Other Suggestions W I Keep System 36 responsibilites/transfer citywide coordination back to Administration W Implement work furlough program fdbr 29 Recommended 'Total Cut Solution' Attachment DEPARTMENT OF FINANCE 2111193 Revenuel xpenditure Gap Target 1 $118,7001 SAVINGS SUMMARY Regular Annual INFORMATION SYSTEMS PROGRAM Staffing Costs Temporary Staffing Eliminate all temporary staffing in the Information Systems Division Impacts: This cut will require: w Reducing our technical support and in—house training to the operating $5,500 dept's—this may result in a decline in overall organizational productivity. ACCOUNTING PROGRAM Temporary Staffing Eliminate all temporary staffing in the Accounting Division Impacts: This cut will require: mo,. Relying on the standard reports prepared by Finance and significantly $9,600 reducing our response to special purpose requests from staff and public. w Curtailing payroll check distribution as an internal mail service. .► Reducing our ability to respond to peak workload needs without impacts on our day—to—day service delivery. W Reducing frequency of various internal control procedures. Accounting Assistant Eliminate Accounting Assistant position in the Accounting Division Impacts: This cut wN require: w Planning and executing significantly fewer special projects. 1.0 $35,500 W Significantly reducing improvement efforts/greater acceptance of existing capabilities and services. r Eliminating special research assignments from the operating departments — we will assist them in doing the research themselves. Further reducing the frequency of various internal control procedures NOTE: These impacts will be mitigated if overall organization activities are significantly reduced as workload demands should be lower. REVENUE MANGEMENT PROGRAM Accounting Assistant Eliminate Accounting Assistant position in the Revenue Management Division Impacts: This cut will require: o. Transfering responsibility for payment of utility bills from the customer 1.0 $35,500 to the property owner— this will significantly reduce our customer service request workload(starts and stops). r Purchasing A/R software for all of our LANs and decentralizing invoice preparation&A/R management to the operating departments. W Billing transient occupancy taxes quarterly rather monthly. Customer Services Supervisor Eliminate Customer Services Supervisor position Impacts: This cut will require: Accepting a significant reduction in our customer service improvement 1.0 $47,000 efforts.This in an area where we have made significant imnprovements over the past year.Spec accomplishments included: — Implementing phone—in requests for utility service. — Eliminating customer deposits. — Piloting credit card program. — Improving our overall customer service policies and strategies. It will simply not be possible to develop and implement these kinds of improvements in the future without this management resource. w Planning and executing significantly fewer special projects. Recent examples include the business tax update and water rate structure review. w Reducing our quality and internal control capabilities. TOTAL REVENUE/EXPENDITURE GAP CUT LEVEL ;`1A'`;` $133100 30 Recommended °Total Cut Solution' DEPARTMENT OF FINANCE . 2/11193 State TakeawayContingency Target s 189,90-01 SAVINGS SUMMARY (Includes revenue%xpendituregaptarget) Regular Annual Staffing Costs Carryover from 'Revenue enditure Gap"Cut Level 3.0 $133,100 INFORMATION SYSTEMS PROGRAM Contract Services $7,200 Eliminate funding for fmancial management information system software support except for basic maintenance Impacts: This cut will require: ml� Accepting our current capabilites as they exist without any improvement or modifications;any changes— however minor — will require case—by—case funding approval. Computer Systems Technician 1.0 $49,600 Eliminate Computer Systems Technician position Impacts: This cut will require: W Significantly reducing support and training capabilites to the operating departments. W Reducing our ability to plan,organize,and coordinate most effective use of our MIS resources and responding to future needs as the Information Systems Coordinator will have to take on a more technical role to meet day—to—day support requirements of the operating departments. TOTAL STATE TAKEAWAY CUT LEVEL 4`0 >S189'900' 31 M':r:^.¢:3.^..+i'g'?':::Y^.:Y.yS^ :";,..,,:::,;:::c :. aa::�a<.......:...:::.::•a`:a;a;c>Y;:<:::.•;"y:::;::;•:::a:::i:::;:;:r.'x%":+:>:.:...;.:.::...:...:..:: 3::::::::. MEMORANDUM ..�. ._a..,:...:...:....::..:.,....:...,.:....:.:.,<.:.,....,.«.v.,.:.a<:::.::::<::�:<..+<,:.�a�a: ::<:..�"..n: < Date: February 10, 1993 To: John Dunn, CAO 0 From: Arnold Jonas, ommunity Development Director Subject: Process Used to Develop "Total Cut" Strategy Following presentations by the CAO and Finance Director, the Building and Planning Divisions discussed at separate staff meetings the overall impacts of the "Total Cut" process and its potential for reduced service levels. After the staff meetings, the Director and mid-managers of the department held a series of meetings to discuss specific alternatives. An attempt was made to correlate costs with the service levels of the department, but this was discarded as being too time-consuming and imprecise. The Administrative Analyst was then given the task of formalizing the concepts and preparing a list of the options, the corresponding cost savings for each and impacts on service levels. Initially the focus was on reducing any remaining non-staffing operating costs. Then eliminating all part-time/temporary staffing was included. Taking these steps first reduced the impact on the remaining regular staffing, thereby mitigating reductions in service levels. , Affected staff members were contacted individually and were given the opportunity to comment on the recommendations. At the department's weekly staff meeting today we will be presenting the final recommendations and answering questions. 32 :`iVIENT REVEN. .:-EXPENDITURE GAP ' COMMUNITY DEVEL Regular Annual Program/Description Staffing Savings COMMISSIONS AND COMMITTEES Eliminate Commissioner Salaries $17,100 Service Impact: Unknown. It may be more difficult to find citizens willing to commit extensive time and resources to advisory body positions. Reduce Printing Expense $5,000 Service Impact: As proposed, the Historic Plaque Program would be eliminated, fewer copies of the Historic Walk brochure would be produced, and funding for all other commission-related printing would be eliminated. Reduce Office Supplies $300 Service Impact: Funding for awards (ie. framed certificates of appreciation) to outgoing advisory body members would be eliminated Some funds would remain to purchase cassette tapes for recording meetings and new name plaques as needed. Reduce Funding For League Meetings $1,700 Service Impact: Commissioners wishing to attend the League of California Cities conference or Planning Commissioner Institute will be required to pay some of the cost. Reduce Funding For Professional Conferences $900 Service Impact: Commissioners will be limited to the number of conferences they attend. Commissioners will be required to pay some of the costs. Reduce Funding For Commission/Committee Meetings $1,000 Service Impact: As meals for commissioners was _ eliminated last year, funding is no longer needed for this J function. However, funds are provided for one annual dinner meeting for each advisory body. 33 Regular Annual Program/Description Staffing Savings Eliminate Funding For Miscellaneous Trips and Meetings $700 Service Impact: None. Funding provided in other accounts. TOTAL REDUCTION 0.0 $26,700 0 COMM.GAP 34 COMMUNITY DEVEL 2MENT REVE1. c-EXPENDITURE GAP Regular Annual Program/Description Staffing Savings PLANNING Reduce the Office Assistant II position From 0.8 to 0.5 0.3 $11,000 Service Impact: Prompt response to the public at the counter and to phone calls will be reduced, resulting in delays to requests for information. The ability to have clerical support at the public counter at all times will become more difficult. Some tasks (maintaining the Planning Library, filing, agenda preparation) will have to be reduced or reassigned. Support for the Building Division clerical staff will become more difficult. Reduce the Graphics Technician position from 1 .0 to 0.7 0.3 $12,500 Service Impact: Legally-mandated maps and materials essential to the operation of the department will continue to be maintained, however creation of new maps and graphics would be limited. Conversion of manually-drawn maps to computer format would be eliminated, requiring greater time for maintenance. No mapping or graphic services would be provided to other departments. Purchase and distribution of city-wide stationery would be eliminated. Reduce One Associate Planner Position to 0.7 0.3 $14,900 Service Impact: Reduction of planning staff will cause an incremental decrease in efficiency and increased delays in permit processing. The service impacts will be mitigated somewhat through implementation of an effective permit streamlining program (already under way). However reduced staffing will delay the implementation of those improved regulations. Eliminate Most Part-Time/Temporary Staffing $21,800 Service Impact: Most tasks (ie. microfilming, posting of property, legal notification, delivery of advisory body agendas) will be transferred to regular staff, at the same time we are reducing regular staffing. Regular staff would, in turn, eliminate other tasks to accommodate legally-mandated functions thereby reducing service 35 gular Annual Program/Description Staffing Savings levels for processing planning applications. Costs to the City for legally-mandated tasks, such as notification, would be higher if done by regular staff. Funding would continue for Planning Commission minute clerk. Reduce Postage $500 Service Impact: No funding will be provided for public surveys or bulk-mailing done by outside contractors. If such services are authorized by the Council, specific requests will be submitted for additional appropriation. Reduce Office Supplies $1,900 Service Impact: None. Based on stringent.purchasing guidelines, expenses for office supplies has decreased over the past year. If staffing is reduced, less funding will be required in the future. Reduce Drafting Supplies $200 Service Impact: None. If the graphics position is reduced to half-time, then less funding will be required to support the position. Reduce Blueprinting Supplies $200 Service Impact: None. If the graphics position is reduced to half-time, then less funding will be required to support the position. Eliminate Planning and Research Services $23,700 Service Impact: No ongoing funding will be provided for unanticipated contract services. If consultant services are necessary, additional appropriations will be requested from the Council. Reduce Data Processing Services $2,300 Service Impact: Funding is for maintenance of existing applications only. Additional programs or functions could not be created without additional appropriation. Existing staff would have to be trained to take on minor 36 .%egular Annual Program/Description Staffing Savings programming and data manipulation functions. Service levels to other staff or governmental agencies which utilize our data will be reduced. Reduce Office Equipment Maintenance $4,000 Service Impact: None. New office furnishings and equipment will require less repair and maintenance. Reduced staff will required an incremental reduction in support functions. Reduce Microfilm Vendor Expense $1,000 Service Impact: Microfilming of back-logged files will be eliminated (ie. tracts, abandonments, signs), and the boxes will be placed in "dead" storage making access more difficult. New planning applications will continue to be microfilmed annually. Eliminate Memberships, Reduce Travel and Meeting Expense $4,200 Service Impact: Staff will be required to assume some or all of the costs of professional development and education. As such, fewer will be willing to participate thereby reducing the professional standards of the department. Reduce Camera and Photo Supplies $500 Service Impact: None. Based on previous expenditures, funding for this item may be reduced. Reduce Materials and Supplies $5,000 Service Impact: If office improvements (brought about by recent staffing reductions) can be implemented prior to the end of the fiscal year, funding at this level can be reduced with no significant service impact. TOTAL REDUCTION 0.9 $103,700 PIANNING.GAP 37 COMMUNITY DEVE. IMENT REVEL :-EXPENDITURE GAP - Regular Annual Program/Description Staffing Savings BUILDING AND SAFETY Eliminate the Plan Check Engineer position 1.0 $41,700 Service Impact: Plan check duties will be distributed among remaining staff. Large projects will be sent out to consultants for plan check; Engineering and Plan Check Services account will be allocated $20,000 to accommodate consultant services. Because inspection staff will assume a portion of the plan check function, same day inspection service will be eliminated. Reduce Printing $500 Service Impact: None. Implementation of an enhanced automated permit processing system will reduce the number of pre-printed forms used in permit processing. Eliminate Radio Appropriation $1,500 Service Impact: None. Acquisitions of additional or replacement radio equipment is not anticipated. Radio repairs are funded City-wide by an account in another departmental budget. Reduce Data Processing Services $3,000 Service Impact: Additional programs or functions cannot be created without this appropriation. The remaining funds are adequate for maintenance of existing applications only. Reduce Microfilm Vendor Expense $1,500 Service Impact: -None. Recent expenditure history and reduced permit activity allows a lower funding level for this function. Reduce Professional Conferences and Education $5,000 Service Impact: Staff will be required to assume some or all of the costs of professional development and education. As such, fewer will be willing to participate 38 gular Annual Program/Description Staffing Savings thereby reducing the professional standards of the department. Eliminate Miscellaneous Trips and Meetings $300 Service Impact: None. Expenditures for this item are not absolutely essential to the mission of the Division. Reduce Camera and Photo Supplies $300 Service Impact: None. Based on previous expenditures, funding for this item may be reduced. TOTAL REDUCTION 1.0 $53,800 BUILOING.GAP J 39 COMMUNITY DEVEL..diMENT STATE TAKE-AWAYS Regular Annual Program/Description Staffing Savings PLANNING Eliminate the Remaining 0.5 Office Assistant 11 Position 0.5 $18,400 Service Impact: Prompt response to the public at the counter and on the phone will be significantly reduced. Time required for processing planning applications will increase. There may be times when clerical staff cannot serve the public at the counter. Record keeping will become less thorough, with an increasing potential for inaccurate information to be used by staff and the public. Existing clerical functions will be transferred to other staff or may be eliminated. Support for the Building Division secretary will be significantly impared. Major restructuring of clerical support functions will be required. Eliminate the Remaining 0.7 Associate Planner Position 0.7 $34,800 Service Impact: Elimination of one Associate Planner in the Development Review Division will reduce efficiency and delay permit processing by as much as 25%. The service impacts will be mitigated somewhat through implementation of an effective permit streamlining program (already under way). However reduced staffing will delay the implementation of those improved regulations. Department priorities will shift to emphasize planning permit processing at the expense of special projects, such as revised ARC Guidelines and ordinance clean-up/streamlining. Eliminate Second Associate Planner Position 1.0 $56,600 Service Impact: It will be difficult to respond in a timely manner to Council requests for special projects or studies (such as repealing park in-lieu fee limits, airport area studies, or even powered blower issues). Although higher-priority general plan implementation programs could proceed during 1993-94, lower priority programs would be deferred an additional year or more. Updating safety, energy and parks elements would be deferred an additional year. There would be less staff involvement in preparing specific plans other than Margarita (ie. Irish 40 sgular . Annual Program/Description Staffing Savings • Hills Or cuff, or plans for existing neighborhoods). TOTAL REDUCTION 2.2 $109,800 PLANNING.STA 41 �►IIOIIIiI�il�lll�llll��������� ��II�IIIIIII�III IIS city of sAn luis oBispo 990 Palm Street/Post Office Box 8100 • San Luis Obispo, CA 93403.8100 MEMORANDUM TO: JOHN DUNN FROM: JIM STOCKT N 5 DATE: FEBRUARY 11, 1993 SUBJECT: FIRST AND SECOND LEVEL BUDGET REDUCTION SCENARIOS FOR FISCAL YEAR 1993-94 In addressing the tasks associated with preparation of the two level budget reduction scenarios, the results thereof forwarded under this cover, the Recreation Department Budget Team' s first concern was that all regular employees be kept fully aware of the fiscal situation the City faces as we approach a new Fiscal Year. Other Budget Team considerations focused on the negotiated MOA' s between the City, the City Employee Association and Mid-Managers to determine how, within the dictates of the MOA' s, job assignments O could be adjusted. The final hurdle considered by the Budget Team before applying the red pencil was how to cut $1 . 00 from our budget without cutting our revenue generation by $ . 50 since our current practice shows a 50 percent return of all Recreation Department operational costs to the General Fund. In accomplishing first level reductions, temporary staff, the historical backbone of recreation programming, took the biggest hit . This recommended action was in accord with the CEA MOA which indicates that temporary positions go before regular positions. It was also necessary to discontinue the services of one regular staff position to meet first level budget cut target . To minimize service cuts and to maintain our current level of revenue generation, remaining staff will be required to redevelop a much closer or "hands-on" approach in programming. Second level reductions required significant service cuts and these program deletions resulted in a corresponding reduction in revenues . An additional 1 . 2 regular positions were eliminated to descend to targeted levels . 42 ,mikhlEISURE. CULTURAL & SOCIAL SERVICES $2.5MILLION REVENUE/EXPENDITURE GAP EDUCTION TARGET: $154,900 Regular Revenue Net Program/Description Staffina Loss Savings VEHICLE FLEET REDUCTION Eliminate two sedans Reduce the number of vehicles by two sedans leaving two trucks registered as Recreation vehicles. SERVICE REDUCTION: Increased coordination among staff for access to transportation. Trucks are the primary vehicle assisting in the production of events, programs and activities. -0- -0- 7,800 RECREATION ADMINISTRATION Training SERVICE IMPACT: Reduces professional organization membership, and training for regular employees. -0- -0- 555 Regular Staffing Eliminate 1 Recreation Coordinator II SERVICE IMPACT: Will require redistribution of brochure production, distribution, small event operations and pre-school administration between existing staff. -1- -0- 44,696 GENERAL RECREATION Salaries: Temporary Employees Reduce temporary employees and associated employee costs, lie: medicare, work comp,etc) SERVICE IMPACT: Reduce scope of low revenue recovery programs for teens including teen ski club movie club, teen trips, teen sports activities, special events for families including Halloween In The Plaza, reduction of 27 hours/week of operation at Activity Centers. -0- -0- 27,300 Line Item Reductions Associated program costs resulting from program reductions targeted above. SERVICE IMPACT: Program supplies for discontinued rograms for teens, Halloween, Easter Week, Thursday Might Activities, janitorial supplies, first aid supplies quipment replacement. -0- -0- 15,600 43 . Revenue Net Proaram/Description Staffing Loss Savinas SPECIAL EVENTS Salaries: Temporary Employees Reduce temporary employees and associated employee costs, (ie: medicare, work comp, etc) SERVICE IMPACT: Eliminates paid assistance and requires additional volunteer recruitment and training. -0- -0- 5,000 AQUATICS Eliminate 1 Recreation Supervisor SERVICE IMPACT: Implement the two supervisor alternative proposed in the Hughes/Heiss Reorganization Analysis. Will require alignment of divisions to two supervisors, five coordinators. Requires addition of $8,000 to Aquatics temporary salaries to assist in program operation. -1- -0- 33,805 Line Item Reductions Costs associated with contract services, training for regular staff, equipment replacement costs. SERVICE IMPACT: Extend use of equipment for O classes, (ie. kickboards, safety and first aid equipment, etc,) eliminate contractual arrangement for the masters program -0- -0- 2,, 344 SPECIAL INSTRUCTION Salaries: Temporary Employees Reduce temporary employees and associated employee costs, (ie: medicare, work. comp., etc) associated with babysitting costs with payment to be absorbed by instructor. -0- -0- 1,800 TRIPS AND OUTINGS Line Item Reductions Reduce those trips and outings activities that could be provided in the private sector or are not recovering total expenditures. -0- -0- 16,000 TOTAL REDUCTION -1- -0- 154,900 44 fEIS2R.E CULTURAL & SOCIAL SERVICES 4 MILLION_REVEN E EXPEND. GAP EDUCTION TARGET: $92,900 Regular Revenue Net Proaram/Description Staffina Loss Savingj GENERAL RECREATION Salaries: Temporary Employees SERVICE REDUCTION: Eliminates Little Rec'ers preschool program. -0- 12,000 16,000 RECREATION ADMINISTRATION Regular Staffing Eliminate 1 Clerical Assistant II SERVICE IMPACT: Will require redistribution of facility reservation responsibilities, reduce customer service response time with phone lines, registration capabilities and information responses. Shift registration emphasis to mail-in and on site. -1- -0- 32,850 Regular Staffing Eliminate 1 Recreation Coordinator II SERVICE IMPACT: Eliminates program areas of special events and trips as described below. -1- -0- 43,783 (RIPS AND OUTINGS Line Item Reduction SERVICE IMPACT: Eliminate trips and outings program that provides ski trips and amusement park trips for teens and sporting event trips for community citizens. -0- 10,850 17,500 SPECIAL EVENTS Line Item Reduction Eliminates special events of Great Pumpkin Run, Youth Amphibathon and Triathlon and Mission Plaza special events of Fourth of July and Christmas in the Plaza. -0- 40,500 48,800 TOTAL REDUCTION -2- 63,350 158,933 NET REDUCTION 95,583 45 PROCESS FOR PREPARING THE PROPOSED TOTAL CUT SOLUTION PUBLIC WORKS DEPARTMENT As we began to formulate the total cut solution for public works department, we established the following objectives to supplement the general guidelines from finance department: 1. Make the process participative by involving all mid-managers in the decisions and by reviewing proposals with all employees as often as possible. 2. Eliminate temporary positions which perform ongoing, year-round program activities in violation of the City's human resources management policies. . 3. Eliminate contract services which can be accomplished by rearranging the workload of the regular workforce. 4. Focus on cutting activities at the C and D service level. 5. Protect regular positions as much as possible to preserve valuable experience and expertise. 6. Spread cuts for regular positions from top to bottom through the organization. We realized the following results in trying to accomplish these objectives: 1. We solicited suggestions for cuts from all employees and particularly the mid-managers. We reviewed the process and the proposed cuts with all employees at two open meetings. We also distributed revisions to all employees as they were submitted. Inviting this participation was often painful, but the O employees throughout the department don't feel anything has been hidden from them. 2. All temporary positions which perform ongoing, year-round activities were included in the first tier of cuts. 3. Over the last 10 years, we've responded to demands for additional or expanded service by contracting out as many services as possible. With nearly all of our recent budget growth concentrated in contract services, we looked there first for potential budget cuts and included them in the first tier of cuts. Because these contracts are so cost-effective, though,we eventually moved many of them into the second tier of cuts. 4. Although we focused on cutting activities at the C and D service level, we recognized that we couldn't realistically avoid cuts at the B service level. In our general fund reductions, 27 percent of the first tier cuts and 67 percent of the second tier cuts were at the B service level. Essential maintenance would continue under our proposals, but with a marked reduction in quality and a shift in emphasis from preventive to corrective work. 5. We originally grouped nearly all of the required reductions for regular staffing into the second tier cuts. Later, as we moved cost-effective contract services into the second tier, we had to bring some regular staffing cuts up into the first tier. 6. Our final proposals included a 31 percent cut in mid-management staffing and a 10 percent cut in general employee staffing. wimd 2/24/99 46 PUBLIC WORKS DEPARTMENT SUMMARY OF TOTAL CUT SOLUTION-GENERAL FUND Service Regular Annual Program and Description of Cut Level Staffing Savings PUBLIC WORKS ADMINISTRATION PROGRAM Employee Recognition C 0.0 $2,000 Temporay Clerical Staffing C 0.0 2,700 Offift Suppler C 0.0 6,000 Contract Printing and Reproduction C 0.0 9,000 Corporation Yard Clerical Staffing B 0.5 19,100 PARKS AND LANDSCAPE MAINTENANCE PROGRAM Trash Removal from Containers in Parks C 0.0 7,300 Portable Restroom Maintenance D 0.0 5,700 Parks Maintenance Management B 1.0 68,000 CMC Labor for Park Maintenance B 0.0 4,000 Weekend Park Maintenance C 0.0 12,200 Ballfield Maintenance D 0.0 19,700 TREE MAINTENANCE PROGRAM Tree Promotion Activities D 0.0 6,000 Tree Planting C 0.0 4,100 BUILDING MAINTENANCE PROGRAM Library Meeting Room Setup D 0.0 51000 Houseplant Maintenance D 0.0 2,500 Janitorial Maintenance B 0.0 28,200 GENERAL STREET MAINTENANCE PROGRAM Sidewalk Repair and Reconstruction B 1.0 58,600 Lane Line Repainting B 0.0 22,500 Welding Repairs C 0.0 5,700 PAVEMENT MAINTENANCE PROGRAM Thursday Night Barricade Removal D 0.0 5,000 Trash Removal from Street Containers C 0.0 7,500 Streets Project and Contract Coordination C 1.0 55,000 TRAFFIC SIGNAL AND STREET LIGHT MAINTENANCE PROGRAM Residential Street Lighting-Mid-block B 0.0 46,000 VEHICLE AND EQUIPMENT MAINTENANCE PROGRAM Vehicle Fueling and Washing C 0.0 7,000 ENGINEERING PROGRAM Engmeenng Consultant Services C 0.0 3,000 Temporary Clerical Staffing C 0.0 3,000 Blueprinting Supplies C 0.0 4,000 . Engineering Design Supervision B 1.0 72,700 47 PUBLIC WORKS DEPARTMENT SUMMARY OF TOTAL CUT SOLUTION-GENERAL FUND Service Regular Annual Program and Description of Cut Level Staffing Savings TRANSPORTATION PLANNING AND ENGINEERING PROGRAM Transportation Management Staffing C 1.0 91,000 VARIOUS PROGRAMS Standby Duly C 0.0 21,500 SUBTOTAL OF CUTS TO COVER REVENUVEXPENDITURE GAP 5.5 $604,000 PARKS AND LANDSCAPE MAINTENANCE PROGRAM Minor Service Contracts for Perks Maintenance B 0.0 3,000 Minor Construction Contracts for Park Maintenance B 0.0 10,000 Maintenance Contracts for Small Landscaped Areas B 0.0 44,300 Parks Restroom Maintenance B 0.0 18,000 SWIM CENTER MAINTENANCE PROGRAM Swim Center Janitorial Maintenance C 0.0 11,000 GENERAL STREET MAINTENANCE PROGRAM O Downtown Sidewalk Cleaning D 0.0 20,000 GENERAL STREET MAINTENANCE OR PAVEMENT MAINTENANCE PROGRAM Street Maintenance Crew Supenmm B 1.0 52,000 PAVEMENT MAINTENANCE PROGRAM Street Sweeping Frequency C 1.0 50,000 ENGINEERING PROGRAM Engineering CADD Mapping C 1.0 52,200 Engineering Inspection B 1.0 41,000 TRANSPORTATION PLANNING AND ENGINEERING PROGRAM Traffic Engineering B 1.0 52,200 SUBTOTAL OF CUTS TO COVER STATE TAKE-AWAYS 5.0 5353,700 TOTAL CUTS-GENERAL FUND 105 $957,700 48 is PUBLIC WORKS - GENERAL FUND REVENUE/EXPENDITURE GAP Regular Annual Program and Description of Cut Staffina Savings PUBLIC WORKS ADMINISTRATION PROGRAM Employee Recognition (Service Level C) Eliminate the budget for employee recognition activities. Service Impact: No direct effects. 0.0 $ 2,000 Temporary Clerical Staffing (Service Level C) Eliminate one temporary technical assistant position (360 hours/ 0.2 full-time equivalents). Service Impact: There might be a shortage of clerical assistance for the transportation planning and engineering program. 0.0 2,700 Office Supplies (Service Level C) - Reduce the budget for office supplies from $10,000 to $4,000. Service Impact: No direct effects. Current expenses for office supplies are running at an annual rate of about $4,000. 0.0 6,000 Contract Printino and Reproduction (Service Level C) Reduce the budget for contract printing and reproduction from $13,000 to $4,000. Service Impact: No direct effects. Current expenses for con- tract printing and reproduction are running at an annual rate of about $4,000. 0.0 9,000 Corooration Yard Clerical Staffing (Service Level C) Reduce one regular secretary position from full-time to half-time. Service Impact: If public works and finance can work out a simplified system for preparing payment vouchers, there should be little effect on clerical operations. With fewer hours available for answering forwarded phones and relaying messages, super- visory employees at the Corporation Yard might have to use answering machines on their phones while they were out in the field. 0.5 19,100 49 PUBLIC WORKS - GENERAL FUND REVENUE/EXPENDITURE GAP Regular Annual Program and Description of Cut Staffina Savinas PARKS AND LANDSCAPE MAINTENANCE PROGRAM Trash Removal from Containers in Parks (Service Level C) Eliminate.one temporary field worker position (1,000 hours/0.5 full-time equivalents) assigned to collect trash from containers in parks. Service Impact: Regular employees would collect trash from containers in their assigned areas when containers were near full. Trash might remain in containers for several days instead of being picked up daily. 0.0 7,300 Portable Restroom Maintenance (Service Level D) Eliminate one temporary field worker position (780 hours/0.4 full-time equivalents) assigned to set up and maintain eight portable toilets on two trailers for Thursday night farmers mar- kets and for about four special events each year. Service Impact: The BIA would have to revert to its former practice of renting portable toilets for Thursday nights, or down- town merchants would have to reopen their restrooms to the public now that the drought has eased. Otherwise, there would not be enough toilets for Thursday night farmers markets. Regu- lar employees could take care of set up and maintenance for the few special events for which the portable restrooms were needed each year. 0.0 5,700 Parks Maintenance Manaaement (Service Level B) Eliminate the parks and buildings manager position. Service Impact: All of the parks and tree maintenance programs would be consolidated with the streets and equipment mainte- nance programs under one manager. The building maintenance program would be placed under public works administration. First-line supervisors would have to assume more budget and policy responsibility, with assistance from public works admini- stration. The streets manager's span of control would expand to five supervisors. 1.0 68,000 0 50 PUBLIC WORKS - GENERAL FUND REVENUE/EXPENDITURE GAP Regular Annual Program and Description of Cut Staffina Savinas PARKS AND BUILDINGS MAINTENANCE (continued) CMC Labor for Park Maintenance (Service Level B) Discontinue contracting for the use of inmate labor from Califor- nia Men's Colony. Service Impact: Because CMC can no longer pay for required supervision, it will not be offering the use of inmate labor until further notice. In the past, the parks and landscape maintenance program has used about 4,000 hours of inmate labor each year. Time spent on tasks such as litter control, weed control, edging, and rough pruning would be substantially reduced and would result in poor appearance of open space areas and medians. 0.0 4,000 Weekend Park Maintenance (Service Level C) Eliminate two temporary field worker positions (1,670 hours total/0.8 full-time equivalents) assigned to open and close parks and clean up trash on weekends. Service Impact: The work schedules for two regular employees would be changed so they would work Saturdays and Sundays. They would be on hand to open and close parks, although they might not be able to clean up trash as thoroughly because they would be performing their regular landscape maintenance tasks. There would be a minimum 20 percent reduction in on-site main- tenance of two parks. 0.0 12,200 Ballfield Maintenance (Service Level D) Eliminate five temporary field worker positions (2,200 hours total/1.1 full-time equivalents) assigned to groom and mark baseball and softball diamonds from April to November where the cost of such work is not reimbursed. Discontinue leasing trucks for these positions. Service Impact: Regular City employees would continue to mow, edge, water, and fertilize the turf. The work to be eliminated would include only dragging the infields and chalking foul lines and batter's boxes. Leagues would have to contract for this work or find volunteers to do it. 0.0 19,700 51 PUBLIC WORKS - GENERAL FUND REVENUE/EXPENDITURE GAP Regular Annual Program and Description of Cut Staffing Savings TREE MAINTENANCE PROGRAM Tree Promotion Activities (Service Level D) Eliminate the budget for the citizen reforestation project adver- tising and the budgets for Arbor Day and Heritage Tree activities. Service Impact: The citizen reforestation project has success- fully promoted awareness of the importance of trees to the com- munity and encouraged citizen participation in tree planting. Revenues from citizen contributions are adequately financing the project. A portion of each contribution to the project would be earmarked for advertising and mailing costs. 0.0 6,000 Tree Plantina (Service Level C) Reduce the budget for tree planting from $8,300 to $4,200. Service Impact: Fewer new trees would be planted each year, and first priority would be replacing trees damaged or destroyed. This reduction would not affect the citizen reforestation project, which would continue to finance new tree planting at a level commensurate with contributions. 0.0 4,100 BUILDING MAINTENANCE PROGRAM Library Meeting Room Setup (Service Level D) Eliminate one temporary janitor position (680 hours/0.3 full- time equivalents) assigned to set up meeting rooms at the City/ County Library. Service Impact: As Recreation Department assumes responsi- bility for scheduling use of the meeting rooms, it has agreed also to take care of setting up the rooms with existing staff. 0.0 5,000 Houseplant Maintenance (Service Level D) Discontinue the contracts to furnish and maintain houseplants at City Hall, 955 Morro, and the Corporation Yard. Service Impact: Hallways and open office areas would look more stark as plants were removed. Employees would have to assume maintenance responsibility for the few remaining plants owned by the City. 0.0 2,500 52 PUBLIC WORKS - GENERAL FUND REVENUE/EXPENDITURE GAP Regular Annual Program and Description of Cut Staffina Savings BUILDING MAINTENANCE PROGRAM (continued) Janitorial Maintenance (Service Level B) Discontinue contracts for janitorial maintenance at the Meadow Park Rec Building, Sinsheimer Stadium Concession Stand, 860 Pacific, the Recreation Center, the Senior Center and the Corpora- tion Yard. (Service at 955 Morro has already been discontinued.) Reduce the service performed by the regular janitorial staff at City Hall and spread the workload over the remaining locations. Service Impact: Regular employees would perform only the fol- lowing minimum basic janitorial tasks at all assigned buildings: cleaning and sanitizing restrooms and breakrooms, mopping and buffing hard floors, emptying central containers for trash and recyclable materials, and replenishing paper supplies. Building occupants (including possibly recreation staff at recreation build- ings and seniors at the the Senior Center) would be responsible for all other services such as: emptying trash and recyclable materials from offices and workstations, vacuuming carpets, dusting furniture, and washing windows. 0.0 28,200 GENERAL STREET MAINTENANCE PROGRAM Sidewalk Repair and Reconstruction (Service Level B) Eliminate one regular maintenance worker position ($38,100) and and one temporary field worker position ($4,000/500 hours/0.3 full-time equivalents); eliminate the budgets for sidewalk recon- struction by contract ($10,000) and sidewalk grinding by contract ($6,500). Service Impact: Two regular maintenance workers and a part-time temporary field worker would continue sidewalk repair and recon- struction work, but the backlog of reconstruction work would grow. In lieu of reconstruction for areas outside the downtown, the main- tenance crew would step up the level of sidewalk grinding, a quick method of repair where the concrete is simply ground down to elimi- nate hazardous displacements. To perform this work the mainte- nance crew would need a grinder and trailer at a one-time cost of $10,000. After identifying hazardous displacements, the mainte- nance crew would apply temporary patches to maintain some safety and then return within two weeks for grinding. Risk management staff believes this procedure may actually reduce trip-and-fall claims (which average about two per year) because patches will be removed more quickly and be less likely to cause hazards themselves. 1.0 58,600 53 PUBLIC WORKS - GENERAL FUND REVENUE/EXPENDITURE GAP Regular Annual Program and Description of Cut Staffina S vin s GENERAL STREET MAINTENANCE PROGRAM (continued) Lane Line Repainting (Service Level B) Discontinue the contracts for lane line repainting. Service Impact: These contracts are no longer required. The street painting crew has discontinued curb painting and repainting where posted signs suffice and safety can be maintained. Also, the crew has finished converting street legends ("STOP","SLOW", etc.) to long-lasting paint. These changes have freed up enough time for the crew to resume all lane line repainting work. Some contract lane line painting would continue under reconstruction, resurfacing and chipsealing projects. 0.0 22,500 Weldina Repairs (Service Level C) Eliminate the budget for welding repairs to tree well frames, signposts and other street furnishings. Service Impact: Brick and sand tree wells would replace steel frames when repairs could not be accomplished by city workers. The appearance of a few tree wells would not be consistent with others. 0.0 5,700 PAVEMENT MAINTENANCE PROGRAM Thursday Niaht Barricade Removal (Service Level D) Eliminate two temporary field worker positions (total 680 hours/0.3 full-time equivalents) assigned to set up and take down barricades for Thursday night farmers markets. Service Impact: Regular employees would set up barricades at the end of their shift. At the end of farmers market, police patrol officers or BIA merchants would have to move barricades out of the street for disassembly and removal the following morning. This procedure would duplicate past practice, which worked well but was somewhat less convenient. Public works staff has notified the BIA of this proposal and has preliminarily received no objections. 0.0 5,000 54 PUBLIC WORKS - GENERAL FUND REVENUE/EXPENDITURE GAP Regular Annual Program and Description of Cut Staffina Savinas PAVEMENT MAINTENANCE PROGRAM (continued) Trash Removal from Street Containers (Service Level C) Eliminate one temporary field worker position (1,000 hours/0.5 full-time equivalents) assigned to collect trash from containers in the downtown and at bus stops. Service Impact: Aggressive reconstruction and chipsealing work has reduced the level of minor pavement failures which require patching. This reduction would allow redirection of regular employees from patching work to trash removal work. 0.0 71500 Streets Project and Contract Coordination (Service Level C) Eliminate the streets project coordinator position. Service Impact: Engineering would have to manage minor capital projects for streets. The wastewater reclamation coordinator would have to assume primary administration of the Corporation Yard local area computer network. Public works administration would have to assume coordination of service contracts. 1.0 55,000 TRAFFIC SIGNAL AND STREET LIGHT MAINTENANCE PROGRAM Residential Street Liahtina - Mid-block (Service Level B) Tum off 270 mid-block street lights in residential areas. Service Impact: Because 530 other street lights at intersec- tions would remain lighted in residential areas, there would be little affect on vehicle traffic safety. The perception of security for pedestrians and parked cars might be diminished. Bicyclists riding after dark might not be able to see as well. 0.0 46,000 VEHICLE AND EQUIPMENT MAINTENANCE PROGRAM Vehicle Fuelina and Washina (Service Level C) Eliminate one temporary field worker position (1,000 hours/0.5 full-time equivalents) assigned to fuel and wash vehicles. Service Impact: There would be minor reductions in field crew • productivity as crews would have to fuel and wash their own vehicles. 0.0 7,000 55 PUBLIC WORKS - GENERAL FUND REVENUE/EXPENDITURE GAP Regular Annual Program and Description of Cut Staffina Savinas ENGINEERING PROGRAM Enaineerina Consultant Services (Service Level C► Eliminate contingency budgets for planning and research and for laboratory services. Service Impact: No direct effects. 0.0 3,000 Temporary Clerical Staffina (Service Level C) Eliminate a temporary technical aide position (400 hours = .2 full-time equivalents). Service Impact: There would be no secretarial staffing during vacation and sick leave periods. There would be no extra help during periods of heavy workload. 0.0 3,000 Blueorintina Supolies (Service Level C) Reduce the blueprinting supplies budget from $10,000 to $6,000. Service Impact: No direct effects. Current expenses for blue- printing supplies are running at an annual rate of about $6,000. 0.0 4,000 Enaineerina Desion Supervision (Service Level B) Eliminate one supervising civil engineer position. Service Impact: The engineering program staff would be consol- idated under one supervising civil engineer, whose span of control would be four or six, depending on the organization of design section into either of two alignments. If one of the engineering assistants were to become registered as a civil engineer, then design section might be organized under that position. An alter- native organization might create three design teams leach with one engineering assistant and one engineering technician) which would report to the supervising civil engineer. The engineering assistants would have to take on more responsibility for scheduling and monitoring progress on CIP projects and for keeping standard specifications up-to-date. The engineering program would lose valuable structural engineering experience. 1.0 72,700 56 PUBLIC WORKS - GENERAL FUND REVENUE/EXPENDITURE GAP Regular Annual Proaram and Description of Cut Staffing Savinas TRANSPORTATION PLANNING AND ENGINEERING PROGRAM Transportation Management Staffina (Service Level C) Eliminate the regular transportation manager position. Service Impact: The city engineer would have to work at least half-time supervising the transportation section. 1.0 91,000 VARIOUS PROGRAMS Standby Duty (Service Level C) Transfer to supervisory employees the responsibility to stand by for notification of after-hours emergencies. Service Impact: Supervisory employees would have the addi- tional burden of unpaid standby duty either one night each week or one week every seven weeks. 0_0 21.500 SUBTOTAL OF CUTS TO COVER REVENUE/EXPENDITURE GAP 5.5 $604,000 57 PUBLIC WORKS - GENERAL FUND STATE TAKE-AWAYS Regular Annual Program and Description of Cut Staffin Savinas PARKS AND LANDSCAPE MAINTENANCE PROGRAM Minor Service Contracts for Parks Maintenance (Service Level B) Eliminate contracts for restroom painting and parking lot cleanup. Service Impact: Regular employees would perform this work as needed in their assigned areas. Emphasis would shift from prevention to correction. 0.0 3,000 Minor Construction Contracts for Parks Maintenance (Service Level B) Eliminate the contingency budget for contract construction work. Service Impact: Regular employees would have to temporarily forego routine maintenance tasks to work on repairs. 0.0 10,000 Maintenance Contracts for Small Landscaped Areas (Service Level B) Discontinue the maintenance contracts for small landscaped areas near parking lots, buildings, median islands, and sound walls. Service Impact: This work includes trimming, weeding, mowing, edging, fertilizing, spraying, trash removal, and sidewalk cleaning -- everything except irrigation maintenance. Regular employees would assume less than one third of the work, and maintenance intervals would be extended. Regular employees would apply growth control chemicals to selected areas and plants, but these areas would look overgrown and unkempt for most of the year. Other park maintenance would suffer as regu- lar employees shifted some of their time to these areas. Future capital improvement projects might replace existing planted areas with hardscape or very low maintenance plants. 0.0 44,300 Parks Restroom Maintenance (Service Level B) Discontinue the maintenance contracts for eight parks restroom buildings. Service Impact: Regular employees would service the restrooms in their assigned areas. This maintenance takes about one hour per day per restroom building, so maintenance effort in other areas of the parks would decline by about 11 percent. Less trimming, weeding, edging, fertilizing, and spraying would leave the parks looking less manicured, particularly from late spring to early autumn. 0.0 18,000 58 PUBLIC WORKS - GENERAL FUND STATE TAKE-AWAYS Regular Annual Proaram and Description of Cut Staffing Savings SWIM CENTER MAINTENANCE PROGRAM Swim Center Janitorial Maintenance (Service Level C) Discontinue contract janitorial maintenance at the Swim Center. Service Impact: The regular maintenance worker assigned to the Swim Center would take over the janitorial work. In tum, the regular pool maintenance technician would have to assume some of the equipment maintenance work now performed by the maintenance worker. The public would likely notice a decline in the overall appearance of changing areas and restrooms. 0.0 11,000 GENERAL STREET MAINTENANCE PROGRAM Downtown Sidewalk Cleanina (Service Level D) Discontinue downtown sidewalk cleaning by contract. Service Impact: If the BIA could not afford this service, side- walks would become unsightly as grime accumulated. Grease from food vending on Thursday nights could cause slipping hazards and could be tracked into stores. The City would allow the BIA to use a recently purchased scrubbing machine, which is significantly more efficient than the old model. This new machine could either reduce contract cost for the BIA or allow merchants or their employees to perform the sidewalk cleaning work. 0.0 20,000 GENERAL STREET MAINTENANCE PROGRAM OR PAVEMENT MAINTENANCE PROGRAM Street Maintenance Crew Supervision (Service Level B) Eliminate one regular streets supervisor position. Service Impact: Two streets maintenance sections 00 employees total) would be consolidated under the supervision of one streets supervisor. Maintenance crews would have to operate more inde- pendently. Streets division would lose expertise in either pave- ment maintenance or general street maintenance procedures. 1.0 52,000 59 PUBLIC WORKS - GENERAL FUND STATE TAKE-AWAYS Regular Annual Program and Description of Cut Staff inSavings PAVEMENT MAINTENANCE PROGRAM Street Sweeoing Frequency (Service Level C) Eliminate one regular heavy equipment operator position. Reduce the budgets for street sweeper fuel and replacement brooms. Service Impact: Current street sweeping frequency is six times a week on downtown streets, twice a week on major arterials, and once every two weeks on remaining streets. Frequency would be reduced to five times a week on downtown streets, once a week on major arterials, and once every four weeks elsewhere or as needed to keep storm drainage systems from clogging with debris. Streets would be marginally dirtier. Debris on major arterials would remain in bicycle lanes for a longer period. 1.0 50,000 ENGINEERING PROGRAM Engineering CADD Mapping (Service Level C) Discontinue general fund financing for one regular engineering assistant position assigned to CADD mapping of City infrastruc- ture. Continue financing this position at half time via the water and sewer enterprise funds, which would benefit by having their systems mapped. Service Impact: The Hughes, Heiss organization study recom- mended eliminating this position when the streets system CADD mapping was completed. To satisfy public demand for accurate, up-to-date utility system mapping, the CADD mapping work should continue and be financed directly from the utilities enterprise funds. 1.0 52,200 Engineering Inspection (Service Level B) Eliminate one regular engineering technician position. Service Impact: The remaining engineering technicians would have to spread the drafting and inspection workload. The en- gineering staff could no longer produce maps and graphics for other divisions and departments. Design drafting capacity would decline by about 25 percent, so there would be less flexibility to add CIP projects in the future. 1.0 41,100 60 PUBLIC WORKS - GENERAL FUND STATE TAKE-AWAYS Regular Annual Proaram and Description of Cut Staffina S vin s TRANSPORTATION PLANNING AND ENGINEERING PROGRAM Traffic Ennineerina (Service Level B) Eliminate one engineering assistant assigned to traffic engineering. Service Impact: Another engineering assistant from engineering design section has traffic engineering experience and would be assigned to work one day each week on traffic engineering. (To cover the loss of design productivity, an engineering assistant from development review section would devote time to design as needed and as recommended in the Hughes, Heiss organization study.) Response to citizen complaints would be delayed and there would be a large backlog of unwritten traffic work orders. With an 80 percent reduction of traffic engineering time, the transportation planning and engineering program would lose valu- able engineering and measurement capacity. 1_0 52.200 SUBTOTAL OF CUTS TO COVER STATE TAKE-AWAYS 5.0 $353.700 TOTAL CUTS - PUBLIC WORKS - GENERAL FUND 10.5 $957,700 61 PUBLIC WORKS DEPARTMENT SUIIAMARY OF TOTAL CUT SOLUTION;ENTERPRISE FUNDS Servlee Regular Mnual Frog. -and'Desoription of Cut Level Staffing Savinge PARKING PROGRAM ConlraetSenfim 1B. 0.0 $74:800 TOTAL CUTS='PARKING FUND 0.0 $74,800 TRANSIT PROGRAM Weekday Trolley Service D 0.0 518,700 Weekend Fixed Route Transit Service B O.0 . 60,400 Roue f Tandem Service B 0.0 fi,700 TOTAL CUTS=TRANSIT FUND 0.0 585,800 '62 . PUBLIC WORKS - PARKING FUND REVENUE/EXPENDITURE GAP Regular Annual Program and Description of Cut Staffina Savinas PARKING PROGRAM Contract Services (Service Level B) Reduce the amount budgeted for contract services from $227,700 to $152,900. Service Impact: No effects. Based on recent contract contract renegotiations the budget for contract services in 1993/94 should include the following purposes and amounts: Citation processing $ 50,000 Coin collection 40,400 Garage and office cleaning 38,000 Coin counting 5,000 Security service 8,000 Fire alarm and sprinkler service 2,500 Trustee service 5,000 Elevator service 4.000 $152,900 About $1,000 should be left available but unencumbered in the coin collection area to allow for periodic additional collections. 0_0 $74,800 TOTAL CUTS - PUBLIC WORKS - PARKING FUND 0.0 $74,800 63 PUBLIC WORKS - TRANSIT FUND REVENUE/EXPENDITURE GAP Regular Annual Program and Description of Cut Staffina Savinas TRANSIT PROGRAM Weekday Trolley Service (Service Level D) Eliminate weekday trolley service from Monday through Thursday. Service would continue on Thursday evening, Friday, Saturday, and Sunday. Service Impact: This reduction would eliminate about 14,000 passenger trips. It would be less convenient for visitors and shoppers to travel around downtown on weekdays. Visitors staying at motels on Monterey Street would be less likely to visit downtown on weekdays. 0.0 $18,700 Weekend Fixed Route Transit Service (Service Level B) Eliminate fixed route transit service on weekends. Service Impact: Transit-dependent employees who work weekends in the Foothill Boulevard and Madonna Road commercial areas would lose their only convenient commuting option. Many seniors and low-income residents without cars could not shop on the weekends. Operating costs would fall by $76,000, but cash fare revenue would also decline by $15,600. 0.0 60,400 Route 1 Tandem Service (Service Level B) Reduce Route 1 tandem transit service by two hours per day. Service Impact: There may be no loss of passengers because of this reduction, but there would be severe overcrowding on Route 1 regular service and Route 5 tandem service. Because most of the passengers are Cal Poly students or staff, and the university pays for their rides, there would be little cash fare revenue lost. 0_0 6,700 TOTAL CUTS - PUBLIC WORKS -TRANSIT FUND 0.0 $85,800 64 ����iiii►►►►�►►�►�I II 1111111 pl��►iiii�pl 111111 II city osAn tuis oBispo 955 Morro Street • San Luis Obispo, CA 93401 MEMORANDUM February 11, 1993 To: John Dunn, City Administrative Officer ��7y�" From: John E. Moss, Acting Utilities Directo;% / SUBJECT: UTILITIES DEPARTMENT - "TOTAL CUT SOLUTION" SUBMITTAL Attached is the Utilities Department's "Total Cut Solution" submittal. As you can see, the Department has identified a total of $782 , 080 of budget reductions for your review and discretion. The reductions are presented at three levels, A, B, and C. The process used to identify these reductions was one of cooperation and involvement by all department staff. A memorandum was prepared and distributed to all section supervisors, at our regular staff meeting, explaining the process and the need for the department's involvement. The section supervisors were requested to share the memorandum with their staff and to solicit ideas and support for the necessary expenditure reductions. The Utilities Director and Water Division Manager then met with each section separately to answer questions and receive recommendations. Recommended reductions were submitted from each section and impacts identified. The reductions were then placed in order of departmental and City priority and categorized as previously explained as either A, B, or C level reductions. Our intent in this process was not to eliminate programs, services or personnel unless warranted, but rather reduce the operations of existing programs to minimum service levels. This was an important concept in gaining staff support for the reductions in that it demonstrated, as we believe, that all of our existing programs are high priority and are valued by the organization. The more significant reductions to the Water Conservation and Wells programs recognized the reality of our current water supply status, but in addition, recognize the significant accomplishments made in those programs in attaining their key program goals to a point where operating program reductions are possible. With this submittal I would like to take the opportunity to recognize and commend all members of the Utilities department in their support and participation in this exercise. All staff demonstrated a genuine commitment to the City, and as members of the "City team" recognize that their participation and cooperation during these difficult times is essential in maintaining the health of the overall organization. 65 UTILITIES _ REVENUE EXPENDITURE GAP Regular Annual Proaram/Desaintion Staffina Savinas "A"level Cuts - Included in Departmental Base Budgets (eliminates ability to proceed with any program developmet not currently underway or encumbered. Maintenance of existing programs only and eliminates cloud seeding and any drought planing(: WATER FUND - 050 WATER TREATMENT PLANT (5062) Miscellaneous Chemicals (012 accounts) Reduce funding for chemicals. SERVICE IMPACT: Minimal impact to service as need is reduced due to level of water conservation. If demand increases beyond projected levels, this level of funding may not be sufficient. 0 $14,000 WATER ADMINISTRATION AND ENGINEERING (5065) Contract Services (008-119) Eliminate funding for cloud seeding. SERVICE IMPACT: Cloud seeding activities are redundant at this time as reservoir is full. If water storage changes, Council can direct staff to begin cloud seeding activities. 0 $113,700 Prof Organizations, Training, Trips & Meetings (010-131,143,144) Eliminate all funding for conferences and meetings. SERVICE IMPACT: Reduced professional development and training of employees. Long term reduction in employee effectiveness as programs progress. 0 $2,500 WATER CONSERVATION (5066) Printing Supplies (002-012) Reduce funding for printing. SERVICE IMPACT: Reduced public information due to current favorable water storage. 0 $5,500 Other Advertising (008-035) Eliminate funding for public information. SERVICE IMPACT: Reduced public information services due to current favorable water storage. 0 $5,200 'J 66 UTILITIES REVENUE EXPENDITURE GAP Regular Annual Wram/Desc ' Staffna Savinas elevision (008-034) Eliminate funding for television advertising. SERVICE IMPACT: Eliminates funding targeted for television advertising during mandatory rationing. 0 $9,800 Contract Services (008-119)- Reduces funding for consultant and contract services to educate public on water conservation issues and methods. SERVICE IMPACT: Reduced water conservation public relations services and eliminate special projects such as the xeriscape demonstration garden. 0 $16,900 Subtotal Water Level "A" Cuts: $167,600 SEWER FUND - 052 WATER RECLAMATION FACIUTY (5071) Fencing (012-170) Eliminate funding for fencing. SERVICE IMPACT: Future fencing requests will be presented as CIP projects. 0 $2,000 WASTEWATER ADMINISTRATION AND ENGINEERING (5072) Printing, Office Supplies, Subscriptions (002-012, 014, 017, 008-013) Reduce funding by 50%. SERVICE IMPACT: Reduced ability to fund reclamation project activities. 0 $2,125 Trips & Meetings (010-143) Eliminate all funding. SERVICE IMPACT: Reduced professional development and training of employees. Long term reduction in employee effectiveness as programs progress. 0 $2,125 Engineering, Legal Services (008-081,083) Reduce engineering and legal consultant services related to consent 67 UTILITIES REVENUE EXPENDITURE GAP Regular Annual Proaram/Descrintion Staffna Savinas decree and reclamation project from $30,000 to $9,000, a reduction of 70%. SERVICE IMPACT: As potential activities exceed budget, staff will return to Council for specific authorization to proceed. 0 $21,000 PRETREATMENT Hazardous Materials Program No increased funding to department for assuming these responsibilities. Fire department estimated their costs at $50,000 and have reduced staff accordingly. Savings to General Fund through shift to Sewer Fund activity. SERVICE IMPACT: Reduced frequency of Class I Industrial Users inspections. See explanation. Undetermined. Contract Services (008-119) Reduce funding for contract services related to program administration. SERVICE IMPACT: Minimal impact - will reduce some program development. Program will operate in maintenance mode. 0 $2,100 Laundry and Linen Services (008-111) Reduce funding by 100%. SERVICE IMPACT: Current staff elected not to wear uniforms. 0 $600 Subtotal Sewer Level "A" Cuts: $29,950 WHALE ROCK OPERATIONS (064) Electricity (Whalerock Pumping) (005-051) Reduce projected pumping costs by 20% due to improved pump efficiencies. SERVICE IMPACT: Assuming efficiency assumptions are accurate and Salinas water quality is acceptable to meet projected deliveries, should have no impact on services. 0 $69,400 Equipment Maintenance (008-092) Reduce funding for equipment maintenance from $5,600 to $2,600, a reduction of 46%. 68 UTILITIES REVENUE EXPENDITURE GAP Regular Annual ER:ram/Desoi i Staffina Savinas IMPACT: Pump Upgrade Project resulted in new pumps and staff has replaced rotating components in existing pumping units. 0 $3,000 Lab Services (008-093) Eliminate funding for lab services. SERVICE IMPACT: Lab services will be performed by City Water Treatment Plant staff. 0 $1,000 Building and Construction Contracts (008-100) Reduce funding for building contracts by 50%. SERVICE IMPACT: Since the residence is unoccupied, funding is required only for the administrative buildings. 0 $500 Subtotal Whale Rock Level "A" Cuts $73,900 Water $167,600 Sewer 29,950 Whale Rock 73.900 Total "A" Cuts $271,450 69 UTILITIES REVENUE EXPENDITURE GAP Regular Annual Program/Description Staffino Savinas "B"level Cuts - Will result in further reduction of key program activities and effectiveness, with greatest reductio in Water Conservation, Wells and Whale Rock Fishing programs. WATER FUND (050) WATER TREATMENT PLANT (5062) Misc 012 Accounts (Chemicals and supplies) Reduce funding for various equipment and supply accounts. SERVICE IMPACT: May impact ability to respond to equipment failures. 0 $8,225 WATER DISTRIBUTION (5063) Associations, Prof Conferences, Trips & Meetings (010-130,141,144) Reduce funding by 93%. SERVICE IMPACT: Reduced professional development and training of employees to minimum mandated safety training programs. 0 $1,400 Contract Services (008-119) O Eliminate funds for trench repair. SERVICE IMPACT: Trenches would be repaired with cold patch only. More permanent repairs could be accomplished as a part of city street resurfacing program. 0 $65,000 CUSTOMER SERVICE (5064) Overtime (010-003) Reduce funding for overtime. SERVICE IMPACT: May limit or reduce response to lower priority system repairs. May result in additional loss of water and lengthened customer disruptions. 0 $3,000 Water Meters (012-293) Reduce funding to replace damaged meters. SERVICE IMPACT: Meters with broken glass and fogged meters would not be changed out. May slow down meter reads. 0 $5,000 70 UTILITIES I REVENUE EXPENDITURE GAP Regular Annual ro rarnlDesui Staffma Savinas ATER ADMINISTRATION AND ENGINEERING (5065) Contract Services (008-119) Eliminate funding for engineering services. SERVICE IMPACT: Eliminates ability to proceed with water projects when outside engineering review is required. Will require Council review and approval of any proposed engineering service, with funding coming from Fund Balance. 0 $27,000 Printing, Office Supplies, Computer Supplies (002-012, 014, 017, 018) Reduce funding by 20%. SERVICE IMPACT: Will require careful scrutiny and prioritization of requests for printing, office supplies and computer part replacements. 0 $1,020 WATER CONSERVATION (5066) Salaries: Temp Employees (001-002) Eliminate one position in Oct 93. SERVICE IMPACT: Eliminates school program, )mmunity event participation, water offset inspections, and reduces staff time for water waste code enforcement, water auditing activities. .75 (Contract)$18,750 Reproduction, Publications, Computer Supplies (002-013,017,018) Reduce funding for reproduction, publications and computer supplies by 59%. SERVICE IMPACT: Reduced ability to produce new information and materials. Significantly impacts ability to provide free information to public. 0 $2,400 Advertising-Newspaper and Radio (008-031,033) Reduce funding for public outreach activities by 57% . SERVICE IMPACT: Reduced ability to inform public of city long term water efficiency practices and water supply status. 0 $21,100 71 UTILITIES REVENUE EXPENDITURE GAP Regular Annual Proaram/Desuiotion Staffina Sav'vras Contract Svcs-Toilet Rebate Program (008-119) Reduce funding for retrofit rebate activities by 49%. SERVICE IMPACT: Limits long term water demand management, a cost-effective water supply option. Program would be reduced to annual funding of $70,000/year, which will reduce retrofit activities. Retrofit upon sale program marketability is enhanced by this option. 0 $67,500 Education and Training (010-143) Reduce funding for training by 38%. SERVICE IMPACT: Reduced development and training of employees. 0 $1,200 Materials and Supplies (012-249) Reduce funding for supplies by 100%. SERVICE IMPACT: Eliminates any public education activities. 0 $2,100 WELL OPERATIONS (5069) Electric Utility Service (005-051) Reduces funding by 47%. SERVICE IMPACT: Continued reduced groundwater program. Estimated total production at 500 acre feet/year. Development of "Cemetary" and Autopark Way Wells will no longer be pursued. 0 $65,000 Contract Services (008-119) Reduces funding for lab services by 51%. SERVICE IMPACT: Continued reduced groundwater program. Estimated total production at 500 acre feet/year. Development of "Cemetary" and Autopark Way Wells will no longer be pursued. 0 $23,500 Materials and Supplies (012-249) Reduce funding for supplies by 63%. SERVICE IMPACT: Continued reduced groundwater program. Estimated total production at 500 acre feet/year. Development of "Cemetary" and Autopark Way Wells will no longer be pursued. 0 $12,500 Total Water Fund "B" cuts: $324,695 72 UTILITIES REVENUE EXPENDITURE GAP Regular Annual ram/Desc ' tion Staffna Savinas EWER FUND (052) WASTEWATER COLLECTION (5070) Professional Conferences, Trips & Meetings (010-144) Eliminate all funding for conferences and meetings. SERVICE IMPACT: Reduced professional development and training of employees to minimum mandated safety training programs. 0 $650 WATER RECLAMATION FACILITY (5071) Conferences, Associations, Training (010-130,141,143) Eliminate all funding for conferences. Reduce funding for training by 61% and funding for associations by 76%. SERVICE IMPACT: Reduced professional development and training of employees to minimum mandated safety training programs. 0 $3,575 PRETREATMENT (5073) Conferences, Meetings (010-141) iminate all funding for conferences or meetings. SERVICE IMPACT: Reduced professional development and training of employees. Long term reduction in employee effectiveness as program progresses. 0 $680 Sewer Fund Level "B" Cuts $4,905 WHALE ROCK FUND (064) WHALE ROCK OPERATIONS/FISHING PROGRAM (5095,5096) Engineering and Plan Checks (008-081) Funding for engineering services will be reduced by 100%. SERVICE IMPACT: Engineering services will need to be performed by City staff or specialized services included in CIP requests. 0 $1,500 Trips and Meetings (010-144) Eliminate all funding for meetings. SERVICE IMPACT: Reduced professional development and training of employees to minimum mandated safety training programs. 0 $850 73 UTILITIES REVENUE EXPENDITURE GAP Regular Annual Pros�rarrJDescriotiion Staffing g_ Contract Services (008-119) Reduce funding for hatchery services. SERVICE IMPACT: Staff will pursue alternative funding sources such as Grants and Fines monies available from the State. Will pursue use of volunteer services. 0 $1,500 Salaries: Temporary Employees (001-002) Eliminate seasonal fishing facility staff. SERVICE IMPACT: Fishing program services would be assumed by reservoir operations staff. This reduces public contact and assistance to only 2 positions periodic surveillance and enforcement. .9 $17,200 Laundry and Linen Services Reduce funding by 100%. SERVICE IMPACT: Reflects reduction of temporary fishing staff from laundry service costs. 0 $600 Whale Rock Fund Level "B" Cuts $21,650 Water Fund Level "B" Cuts $324,695 Sewer Fund Level "B" Cuts 4,905 Whale Rock Fund Level "B" Cuts 21,650 Total Level "B" Cuts $351,250 74 UTILITIES REVENUE EXPENDITURE GAP Regular Annual Amemornmescriation Staffma Savinas 19 C-/eve/Cuts - Significant reduction in services and activities in key areas through reduction in staffing. WATER FUND (050) WATER DISTRIBUTION (5063) Temporary Staffing 1001-002) Eliminate temporary staffing for valve maintenance services. SERVICE IMPACT: Will reduce operability of distribution system, increasing time and water waste during repair of breaks. Shut downs of water service to repair system breaks may affect larger areas. .5 (Temp) $7,000 WATER ADMINISTRATION AND ENGINEERING (5065) Contract Staffing (001-013) Eliminate clerical position in Dec 93. SERVICE IMPACT: Reduced departmental clerical support to one departmental secretary, shifting more clerical duties to project managers. 1 $13,000 WATER CONSERVATION (5066) alaries: Temp Employees (001-002,003) eliminate remaining two positions and overtime in Oct 93. SERVICE IMPACT: Eliminates water conservation activities except for enforcement of retrofit upon sale ordinance, a limited rebate program, minimal public information and low income auditing. Will shift hotline responsibilities 2 positions to Rnance and inspection responsibilities to Building. 1.5 $43,5000 Printing, Reproduction, Publications, Supplies (002-et all Significantly reduce any funding for printing and supplies. SERVICE IMPACT: Eliminates ability to produce any free conservation program materials to offer to the public. 0 $7,900 Advertising - Newspaper, Radio (008-031,033) Reduce funding for public information through media. SERVICE IMPACT: Use of media to educate public about long term water efficiency or water storage will be severely limited. 0 $8,000 75 UTILITIES REVENUE EXPENDITURE GAP Regular Annual ProaramlDescriation Staffina SQL Contract Services (008-119) Further reduction in funding for consultant services related to public relations efforts for water conservation. SERVICE IMPACT: Eliminates consultant services for public relations for water conservation activities 0 $2,000 Contract Services -Toilet Rebate Program (008-119) Eliminate funding for retrofit rebate activities. SERVICE IMPACT: Loss of ability to offer any financial assistance to persons who may wish or may be required to retrofit to water efficient hardware. 0 $70,000 WHALE ROCK OPERATIONSIFISHING PROGRAM (5095) Salaries: Temporary Employees (001-002) Eliminate temporary reservoir operations staff. SERVICE IMPACT: Reduced ability of regular staff to respond to scheduled maintenance and emergency situations, resulting in reduced level of service to Commission member agencies. .2 (1 pos) $7,900 Water Fund Level "C" Cuts $151,400 Sewer Fund Level "C" Cuts -0- Whale Rock Fund Level "C" Cuts 7,900 Total Level "C" Cuts $159,300 76 MEMORANDUM TO: John Dunn, City Administrative Officer FROM: James M. Gardiner, Chief of Police tn�? DATE: February 12, 1993 SUBJECT: Department Total Cut Lists Attached are the lists for the Department's participation in preparing the City's 'Total Cut" scenario. The list is my best recommendation based on the information which I have at this time. Both of the primary labor associations, SLOPOA and SLOPSOA, have had input into my decision making. The list has been reviewed by each of the Associations. As of the time of this memo,each Association has concerns regarding the impact of these recommendations on their members. At this point they have not taken an official position on the lists. For review and decision making purposes, the following information is included relative to current staffing. The Department currently has two open Police Officer positions and one open Records Clerk position. A Police Officer currently assigned to Patrol is on a long term IOD status following spinal surgery and the eventual status of this officer has yet to be determined. The Administrative Lieutenant position has been an.authorized "overstaff' for nearly three years. Naturally, each level on these lists reflects a loss of resources with commensurate impacts on our community and our organization. While I have provided a summary of each impact, there are a multitude of considerations and consequences for each decision. I look forward to discussing these issues with you as they affect our ability to provide service to the community and as they affect my personnel. 77 SAN LUIS OEISPO POLICE DEPARTMENT SUMMARY OF SERVICE IMPACTS PRIORITIZED Level A: (First Target = $674,000) Annual Salary Benefit 1. Crossing Guards $301000 2. Animal Control Contract 142000 3. Line Item Accounts 349510 4. Booking Fees 75,000 5. Temporary Employees 52500 6. Records Clerk II 377127 7. Police Lieutenant (Admin) 879237 8. Crime Prevention Coordinator 519923 9. Police Officer (D.A.R.E.) 609770 10. Police Officer (Commercial Enforcement) 602770 11. Police Sergeant (Traffic) 78,572 12. Fleet Reduction (Savings) 127000 Q 13. Communications Tech I 48,019 14. Police Sergeant (S.O.R.T.) 78,572 TOTAL $6749000 78 SAN LUIS OBISPO POLICE DEPARTMENT SUMMARY OF SERVICE IMPACTS PRIORITIZED Level B: (Second Target = $400,084) Annual Salary Benefit 15. Police Officer (NTF Detective) 609770 16. Communications Technician I 489019 17. Police Sergeant (Admin) 787572 18. Police Officer (S.O.R.T.) 60,770 19. Police Officer (S.O.RT.) 609770 20. Police Captain 922832 TOTAL $4012733 79 DETAILS OF SERVICE IMPACTS POLICE DEPARTMENT Level A Service Impacts 1. CROSSING GUARDS $307000.00 Impact: Cost recovery only. The School Superintendent has indicated his willingness to explore contracting with the Department to pay for these services. We will still retain the responsibility for hiring, training, supervising, and filling in vacancies with on-duty personnel if a guard is unable to make the assignment. 2. ANIMAL CONTROL CONTRACT $147000.00 Impact: None on the Department. Recommended changes are eliminating $9,000 for the City's portion of the school educational programs and $5,000 for dead animal pickup. Public Works has O indicated that they can handle the animal pick-up and disposal 3. LINE ITEM ACCOUNTS $34,510.00 Impact: These cuts reflect additional reductions in POST and non-POST training accounts, meetings, and selected reductions in pagers and cellular telephones. This will reduce training to state mandated or job essential levels. The reduction in pagers may mean some extended responses for off-duty investigators and line SWAT personnel. 4. BOOKING FEES $752000.00 Impact: Unknown impact at this time. We will begin releasing all misdemeanor arrestees who are not a danger to themselves or others on their 80 written promise to appear without booking them at the County Jail. This may increase or decrease the amount of time an officer is away from the field with an arrestee. 5. TEMPORARY EMPLOYEES $57500.00 Impact This will eliminate the phone back-up and Records Unit relief position. This will mean a return of peak phone work loads to Communications, Records, and secretarial positions. It will also mean more overtime should we have extended illnesses or vacancies in the Record Unit. 6. RECORDS CLERK 11 $379127.00 Impact, This will eliminate one Records Clerk from the unit. During busy times of the year, this will mean an extended turn around on routine reports to the public. It will also mean a continuation of the recent changes in the hours that Records is open to the public. This will be done to ensure that court documents are ready - within legal time requirements. 7. POLICE LIEUTENANT $879237.00 Impact This will eliminate a Police Lieutenant position. While we will evaluate the situation in light of total cuts, the recommended reduction will probably be the Administrative Lieutenant. His program management functions for nuisance abatement, false alarms, second response violations, cost recovery, and permits will be tasked to units in both the Administrative and Operations bureaus. These will impact the workloads of these other units and will reduce available field time for those tasks assigned to patrol staff; 81 8. CREWE PREVENTION COORDINATOR $512923.00 Impact: This will eliminate the non-sworn crime prevention position. This position has been the primary position responsible for keeping crime statistics, facilitating crime prevention presentations, coordinating the ride-along program, and representing the Department in community events. These duties will be divided amongst both the Operations and Administrative Bureaus. This will limit the number of public presentations we are able to make and will potentially decrease available patrol time as some field officers are used for presentations. 9. POLICE OFFICER $60,770.00 Impact: This will eliminate Department funding for the D.A.Rl3 officer. The only reason for placing the position on this list is the current efforts of local businesses to raise funds to ensure the continuation of the program Should this fail to materialize we will reevaluate this recommendation based on the extent of budgetary impacts. 10. POLICE OFFICER $60,770.00 Impact This will eliminate the Commercial Enforcement Officer position. We will lose the specific commitment to commercial vehicle enforcement. We may also see some decline in overall enforcement revenue by reducing this Traffic Unit position. This also represents a direct loss of field police resources. 11. POLICE SERGEANT $78,572.00 Impact This will eliminate the Traffic Sergeant position. 82 This will require restructuring supervisory responsibilities for the unit and will remove a uniformed supervisor from field deployments. This is a direct loss of available police resources in the field. Administrative duties such as special events coordination and representing the Department on various City committees will be reassigned within the Operations Bureau. 12. FLEET REDUCTION $12,000.00 Impact: With the loss of field positions, we would anticipate this amount of annual savings based on the reduction of the fleet and reduced maintenance costs. 13. COMMUNICATIONS TECMIGCIAN $482019.00 Impact This will eliminate one Communications Technician position. We will lose the additional staffing provided for peak activity periods. We can also expect an increase in overtime to fill in for periods when vacancies exist either for extended illness or replacements due to resignations. 14. POLICE SERGEANT $782572.00 Impact This will eliminate one Police Sergeant position. At this level it would most likely be the SORT supervisor position. The overall supervisory responsibilities would be assigned directly to the Operations Captain with daily functional supervision assigned to the Watch Commanders. This would be a direct loss of field police strength and direction. For many unit operations, it would require the use of other sworn personnel to assist. SUBTOTAL LEVET, A 674,000.00 83 POLICE DEPARTMENT Level B Service Impacts 15. POLICE OFFICER $602770.00 Impact: This will eliminate one Police Officer position currently assigned to the Narcotics Task Force. This would reduce the strength of the Task Force in dealing with the major narcotics problems facing the City. It would also eliminate the immediate involvement of our Department in establishing priority cases for the unit. 16. COMMUNICATIONS TECHNICIAN $482019.00 Impact: This will eliminate one Communications Technician and would require the Communications Supervisor to be assigned full time to a regular shift. This would also increase the use of overtime as noted in the impact of the reduction of the first Communication Technician position. 0 17. POLICE SERGEANT $78,572.00 Impact: This will eliminate on Police Sergeant position, most likely the Administrative Sergeant. All training functions would be tasked to patrol supervisors with the attendant loss of field time. Those administrative tasks which had been picked up from the loss of the Administrative Lieutenant would be reassigned to personnel in both the Administrative and Operations bureaus. 18. POLICE OFFICER $60,770.00 Impact: This would eliminate one Police Officer position currently assigned to SORT. This would directly impact the Department's ability to work street narcotics and gang problems. It would also 84 lessen the available pool of resources to supplement patrol staffing. 19. POLICE OFFICER $607770.00 Impact This would eliminate one Police Officer position assigned to SORT. This would effectively eliminate the SORT unit. The remaining officer position would be reassigned back to a patrol shift 20. POLICE CAPTAIN $921832.00 Impact This would eliminate one Police Captain position assigned to the Administrative Bureau. At this level an entire review of the Department structure would be necessary. The organization would be providing basic services and would be in a maintenance mode. SUBTOTAL LEVEL B $401,733.00 GRAND TOTAL 40753,733.00 85 MEMORANDA TO: John Dunn, CAO nn FROM: Bob Neumann, Fire Chief V` DATE: February 23, 1993 SUBJECT: Fire Department Budget Process At the onset of the new year 1992-93, I met with all three shifts individually in a continuing series of "Fireside Chats". The chats were held in early January. These initial discussions explained the City's financial condition, the condition of the State of California and my general perception of how the budget process would unfold in the spring of this year. Your eight-point budget memorandum was reviewed. I formulated a three-step plan that assigned various tasks to: A Budget Review Committee composed of all four labor units, the Fire Department Captains and the Fire Department's management staff. A short review of those assignments follows. 1. The Budget Review Committee was assigned the task of developing specific recommendations as to how the $2.5 and $4.0 million cut could be absorbed in the Department. I met with this group on at least three occasions. 2. On January 13, I met with the Department's Captains in a four hour meeting in which we, in a role-play exercise, reorganized the Fire Department with the only guideline being a $3.5 million budget. (Our current budget is $4.1 million). Many creative ideas were generated in this meeting. 3. On January 19, the Fire Department management staff, five Battalion Chiefs and myself, developed a separate $2.5 and $4.0 million total cut solution. In mid-February, I returned to the entire Fire Department, via Fireside Chats to review the Captains' proposals, update the crews on budget status and to request additional proposals from the Firefighters and Fire Engineers. Also, in mid-February, the Fire Department staff's proposal was reviewed by the Budget Review Committee with a request to a counterproposal by late February. It should be noted that these meetings were held in a spirit of cooperation. While we were never able to reach total consensus on budget cut solutions, the Associations' members were well informed as to the background and reasoning behind my decisions. In closing, it should also be noted that two department members served on two city-wide committees: Grants-In-Aid Committee (Firefighter Jeff Zimmerman) and Public Safety Tax Over-Ride (Battalion Chief Erwin Willis). 86 8 8 O N O c+1 a� y -gg e 7 y y 00s+ �-i a z •E ��-.,, 01 .5 ° � o 'p � w 0 7 ca 'Zi CL y a� (y cd d O V = r o G d to Ncd ., 69 y. G y C° d ° Vyi Qty b e ca C Qw y y bo O vi N ° y U CC eon c ea c o� c� u w w r OR co�'w 1 C o °e o0 rA L' Co V •� C Qf� FU a3S 3 3 �. 0 3 3w° c° Vl ° a W o o w c to °u E. E '� •: c a lu w a a4 a A 87 N C •� � � rr y Q to N ONO N fI9 y9 b�' •--� V'f O Opp w ce � 3a�i oor1a4, 8 � 8 rArA .80 w y w ° C U a •�� 7U •�C�Cr wt�E �dE3 O>y, f' � y ° v'pO CCN `cd �, C° " C -'•S� 0.Cntw°u cc oewoe 0. 2.Gun p e. uywwh 0 ° >% G-,' E FA N '.7 .0 yC = y = rE eE ° o 'fl0E2 >%o ' � w �ec� fl to cg fi. 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RZ IS V7 N y y 'C CLO tE CO) 02 22w � � 3 e y CL w 0 G a a w �H U W �n R 90 v � COPIESTC rn Dew& km rn00 ^—� r dl ❑ D DIR (,�Z MAR 1 1993 f' T. El FmEcHiEF CITY COUNCIm1momic. ❑ FWDIR Date : March 12, 1993 SAN LUIS OBISPO, ca ❑ POUCE CIL To: Council Collea es ❑ mcmT.mum ❑ PEC Da ❑ READ FILE ❑ L From: Penny ��, Re.: Budget LL�� l� T a The challenge of balancing our budget has given each of us an ft a opportunity to re-evaluate how we "do business" . In reviewing the budget materials, I whole-heartedly support the concept of 1 across the board, shared pain and no sacred cows . I would like the council to consider several suggestions not currently before US . 1 . COUNCIL BUDGET - As proposed, $16, 200 . 00 - 12 . 1% is the recommended reduction for the council ' s budget . Just as we are asking our employees to suggest creative "short term" solutions , I am very willing to consider additional reductions . Our needs vary and respecting the individual needs of each other is a priority for me in seeking additional savings . Just as our organization has collectively sought solutions which effect each department differently, I would request the council consider the same approach. One of us may choose to forgo certain allocated monies for travel or mileage or professional development another' might choose a salary reduction. The cumulative effect can be a reduced dollar amount that could then be "plugged back" into programs reflective of the council ' s goals. 2 . COUNCIL SECRETARY - Technically this is not under the direct control of the City Council, but the council members, individually and collectively, benefit from this position. Throughout our organization employees are being asked to accept more job responsibilities. I am very willing to do more for myself . Recognizing the Mayor' s needs from this position are much greater than the other council members, I have no problem in prioritizing those needs over my own. The Mayor has the added responsibility of representing all of us . My request is that the Council request staff to evaluate reducing the Council Secretary position to a half-time status and return with a recommendation at our next budget session. Recognizing that position changes affect real people, this suggestion is very difficult for me to make . After a great deal of thought, I sincerely believe it is for the benefit of the entire organization. 3 . CDBG FUNDS - with the knowledge that we have approximately $200, 000. 00 in "old" CDBG funds that can be used to offset expenditures from the General Fund, I am requesting that the council direct staff to consider those monies be used to pay our annual contribution to the EOC Homeless Shelter. This suggestion would be pending the final decision on the grant application for the women' s Shelter scheduled for next Tuesday. All of these suggestions are being offered with the idea that the council may want to "mix and match" some of the staff recommendations for program cuts and revenue enhancements. Please give me a call to discuss any of the items listed above. Gtr �� 03/12/93 17:27 S 005 239 9144 Meadowlark Farms P.01 MEETING13 AGENDA DATE_ITEM # 1 3/12/93 Dear City Council, VIA FAX This letter is to voice my concern regarding the proposed reduction (30%) in police personal for the City of San Luis Obispo. My feeling is that we must keep our city safe and not make deep cuts in this area. we are inviting gangs to take at fool; hold in our community if we don't have the personal to take control of the situation before it gets out of hand. I propose that during this financial short fall we pull funds from optional projects like adding bike lanes and funding for the Center for the Arts until the economy is in a better state. Sincerely, �r Chuck Young 4124 Poinsettia San Luis Obispo, CA 544-6615 Ii",AR 1 1993 CITv C0!JNCIL SAN L12-IS 081SF0, CA COPIESTO: ❑-Denotes Action ❑ FYI I(Counal P/CDDDIR ICAO W FIN.DIF la'ACAO ❑ FIRE CHIEF RrTTORr1EY ❑ FW DIF ISG CLERK/0FIG. ❑ POLICECH. ❑ ixGMT-1VI-NI D P.EC.DiF ❑ PEP FL 1 IJTILDIR. f NG 3- AGENDA DATE =_L_. ITEM 0 ,�.. 2074Y Street { San Luisis Obispo, California"93461 MOTOR INN, 805/543-2777 i CA 800/543.2777 Como: ❑•Dotes ActionFYI G �`-t3 'March 12, 1993 ❑ �Caancil P/CDDDIR �,Ciu CAO [3 FDD.DIR CITY �Dg;SPO,CA ACAO ❑ FRECHIEF gpN LL.S , C��1 Dear Honorable Mayor Peg Pinard & I�'CLRK/Q C. 0 pOLICEC]- Councilpersons Penny Rappa, Allen Settle, Dave Romerd 13 ?fCN1T.iLLh.,, CI T:ECDfR and Bill Roalman: . °EADFLE ❑ UTILDIP. As owners and manage.rs. of La Cuesta Motor Inn we are writing to you to state our opposition to the proposed increase in the Transient Occupancy Tax and decrease in the Promotion Budget for the City of San Luis Obispo. As some studies have shown, increasing taxes decreases the number of rooms sold. Enclosed is an article for your review of the subject. As proof of the devastating effect that raising taxes has, . we at La Cuesta Motor Inn experienced a decline in occupancy from 1991 to 1992 when the city raised the bed tax from 6 percent to 9 percent. We have not raised our rates since before you raised the bed tax. We believe that decreasing promotion spending by the City would be a major mistake. Our revenues have increased on the average of 5 percent per year over a 4 year time span when we increased promotion spending from 1 percent to 3 percent at the beginning of that same time period. We employ approximately 25 people which is an increase over previous years when we were not renting as many rooms. These San Luis Obispo County residents depend on their jobs and are looking to their leaders, you and I to make sure they have that job in the future, especially when considering the state of the economy: In summary, we need to maintain or increase San Luis Obispo's revenues. As individuals we cannot accomplish this alone. We need our city to look to the long term future and generate additional revenues so that economic stabilization is achieved. If travelers decrease then there aren' t as many people to buy other goods and services in restaurants and other business establishments and there are overall less City revenues. We realize you are in tough position but you will wind up with less revenue with these two proposals. We urge you to consider the above facts when you vote on the city staff recommendations being brought to the city council. Thank you. Sincerely, /thia Wood Herbert Hindler Terri Reay Managing Partner General Partner General Manger 0111i,., '9,V3� 14:38 FROM CLIP TO 08055' '6961540 P.01 TO'- ' ontinues Its Toll By Anita Kramer,Executive Vice President Industry California Lodging Industry Association(CLIA) Purdue University. has finally given they will-it's still a bad tax!)to contributed in fiscal year 1988-89. credence to;what hoteliers have been provide revenue for tourism promo- During 1989-90,the statewide average j . .1 saying for years..o=pancy tabes are tion. This new tax would be Ln daily room rate rose a.mere 1.8 making profits 4arder w come by! addition to what you may already be percent (Sources: California Depart-' paying in local TOT As we go to ment of Commerce and Smith Travel Ai t study conducted press with this article,the legislation is Research) by Purdue University,every 10 not yet in writing and we have no -The Transient Occupancy Tax IS a percent increase in room rates due to further specifics on how the surcharge Tax an Californians.Figures com- taxes results in a 4.4 percent drop in would work or the amount that would piled by the California DepirtinenE of room nights. That translates into an be imposed. Please know,CLIA will Commerce reveal that 60 percent of all occupancy drop of 3.1 percent. do everything in its power to defeat persons staying at least one night at a such a proposal. If ever any type of California hotel or motel are Califor- According to Stephen J.Hiemstra, statewide hotel/rnotrl tax is enacted,it nia residents. Thus,the transient professor of restaurant,hotel,and is only a matter of time before it occupancy tax is a tax imposed upon institutional management at Purdue, reaches an intolerable level. Californians.-and any new or increased "with the break-even point for occu- bed tax or guest mom surcharge would nancy about 65 percent,that decrease As always,the most effective way of be a tax increase on California resi- :a rooms rcnted can mean the differ- controlling TOT is to educate your I dents. (Source:California Department ence between profit and loss." local city officials and in turn,your of Commerce,Number and Character- state legislative representative to the istics of Travelers to California)988. T, iudy.which involved 400 value of tourism and the dangers ;,"--1989) ginpertiespationwide,found that the inherent in the imposition of TOT at average room is taxed 9.8 percerit, either the local or state level. -For Every 10 Percent Increase in with about six percent going to the the Cost to Rent a Guest Room state and the remainder to the county To assist you in your local battles and Hotel and Motel Occupancy.Falls and city. About 5.9 percent of the to arm you with knowledge you can 3A Percent By increasing the bed local tax isgeneralsales tax;the rest is use to educate your elected officials, tax,the cost of renting a guest room lodging specific. the following data has been compiled, becomes higher,ultimately causing a Please use it aggressively in your local negative impact on the number of Hiemstra also found,not surprisingly, efforts to curtail TOT. if you would guest moms rented due to the price that hoteliers wouldn't mind the like a reprint of this article,just give sensitivity on the part of travelers. additional if the revenue were us a call.here at CLIA. (Source:Stephen J.Hiemstra,Ph-D. used to promote tourism through and Joseph A. Ismail,M.S.,Impact of advertising,financing of visitor Room Taxes on the Lodging Indusay. bureaus or construction of convention FACTS ABOUT THE TAXATION Purdue University,March 1991)Had centers. Only about half of the money OF THE LODGING INDUSTRY occupancy rates declined 3.1 percent is now earmarked for those purposes, from the 1991 statewide occupancy of the respondents said. -Transient Occupancy Tax Rates 62A percent,more than 2.5 million are Rapidly Escalating. Levied fewer mom nights would have been In this tough economic climate,I'mexglusively on lodging facilities by sold. Fewer occupied rooms trigger a afraid we will see stronger and stron- cities and counties against the cost of negative employment and economic ger efforts by local city governments renting a guest room, California hotels ripple effect,e.g.,loss of Iodging and tc vase levels of local TOT to and motels paid in fiscal year 1989-90 related jobs;diminished bed tax support general fund activities. In (latest figures available)nearly me-z revenues;reduction in expenditures by fact,CLU has learned them is pro- half billim($482-3 million)in lodging guests for meals.Vansporta- posed legislation that would establish sientoccupancy Cbed")taxes,a 4,4 tion,retail puiduAses,etc.;and lower a statewide"surcharge"(call it what percent increase over the$462 million sales tax receipts. 1: : 1 FRi)i'i iL1A TO 080554406961540 P.02 Aghk Adak ,Transient Occupancy Tax Receipts (properties with no restaurant opera- attendees staying at San Francisco- are NOT Spent to Promote Travel, tions)lost an average of$741 per located hotels and motels,along with Tourism and Convention Business. guest room. For full-service opera- the number of room nights used by When the California legislature tions,this loss was mon:than 50 • convention delegates,declined 6 gramcd local jurisdictions the author- percent higher than the average loss percent and 6.2 percent,respectively. ity to levy a tax on the privilege of nationally of$2,851 per guest room Putting this drop in convention c,curpying a guest room,the monies after fixed charges and before income business into economic perspective, raised by this"transient occupancy taxes. For limited-service properties, convention delegates staying at San tax"were to be used for the promotion this negative balance was almost four Francisco hotels and motels spent of tax-generating travel,touiittm and times the national average loss per twice as much per day than the convention activities. Contrary to the guest room of$192 At$10,239 per average per day total expenditures by intan of the 1964 enabling legislation. guest room,fixed charges for Califor- ail visitors staying at Sari Francisco a report issued by the League of nia full-service properties were more lodging facilities($304 versus$154, California Cities states that nearly than 26 percent higher than the respectively). (Source: San Francisco two-thirds(65.7 percent)of cities used national average of$8,135 per guest Convention&Visitors Bureau,The bed tax revenues for general fund room. Similarly,fixed charges of Bureau Book. 1990) pto aw ._, ses u.—.1atei profitable local $6,127 per guest room for limited- . • P.�.., tourism promotion. Nearly 66 percent service lodging establishments in Increasingly,one of the major factors of total bed-tax revenues collected by California were 35 percent higher than for meeting planners in deciding on a cities statewide are used for general the national average of$4529 per location for a convention is the fund purposes (Source:League of guest room. (Fixed charges include transient occupancy tax rate and how California Cities,Transient Occu- land and building rem,property taxes. the bed tax revenues am appropriated. panty Tax Report:Survey Results and insurance,interest.depreciation and In 1991.the Washington,DC-based Summary. 1989) amortization.leased equipment and Convention Liaison Council adopted 2 misedUaneous fixed charges.) resolution opposing discriminatory -Health of California Lodging (Source: Smith Travel Research and tourism taxes,including the,tra=en Industry Listed as Critical. In 19911, Arthur Andersen&.Company.The occupancy tax,that are levied to funs* California's Hotels and motels expert- HOST Report. 1990) projects unrelated to the enhancement cried a 2 percent decline in occu- of convention,exposition,meeting ane panty compared to 1990. Coupled *Lodging Industry Sales Tax Re- tourism activities. The resolution with lower occupancy,the statewide ceipts Down. Sales tax receipts. pointed out that such discriminatory average daily room rate for 1991 another barometer of the state of the taxes jeopardize jobs and threaten declined.5 percent (Source: Smith health of the California lodging economic growth. Among others,the Travel larch) industry.were off 9 percent in the Convention Liaison Council's 24 second quarter of 1991 (latest figures members include major meeting -Lackluster Business,Lower Room available)compared to the second groups such as the American Society Rates and the High Cost of Doing quarter of 1990. (rhe effective sales of Association Executives.Council of Business in California Contributed tax rate was 3 percent higher in 1990.) Engineering and Scientific Society to the Industry's Poor Economic (Source: California State Board of Executives,Meeting Planners Interna- Per*�rmance in 1990. According to a Equalization) tional.National Coalition of Black report compiled by the nationally Meeting Planners,Religious Confer respected lodging industry consulting *Lucrative Convention Business ence Management Association, firm of Smith Travel Research and Down in California. Convention Society of Corporate Meeting Planner; published by the international account- business m California,which gener- 'and Society of Government Meeting ing firm of Arthur Andersen&Com- ates the highest tax revenues in terms Planners. (Source: Convention pany,California-situated M-service of per capita spending,is down. For Liaison Council) lodging establishments(properties example,the city and county of San with reSiaw=operations)lost an Francisco witnessed in 1990 a 6 average of$4,498 per guest room after percent drop in convention attendees. ,ri&rqwbmdfnm Ae Aprr7199?issue fixed charges and before income taxes. compared to 1989. During this same nodsing Update.pabgdwd by da ca Limited.service lodging facilities period,the number of convention Lodging tndnsVy A=xidi=_:. 03/11/1993 16: 51 FROM CLIA TO 080554406961540 p,02 • Occupancy Taxes: No 'Free Lunch s T, Many municipalities have enacted room or occupancy taxes as a means of gaining "free" revenue—money from travelers, who are not constituents. But this form of taxation without representation also has its down side, in the form of reduced occupancy by Stephen J.Hiemstra government,or even for no purpose Room taxes are intended to be and Joseph A.Ismail specifically designated at the tune imposed on nonresidents who do of the imposition of the tae.The not have a voice in the imposition TAXES ON away-from-home purpose of this article is to consider or use of the tax.Perhaps for that lodging services are often viewed and discuss the hotel guests' reason they are considered to be a as a painless way to raise revenues economic beha-wrior in reaction to. "free good"to the community. in a community,particularly if the room taxes. Room taxes have gained consider- need is for revenues to bund The taxes usually are ad valo- convention centers,to purchase rem taxes applied to room rates, Stephen-Y Hiemstra, Ph.D., is assets for use by tourists,or to but sometimes are applied as a flat professor of hospitality marketing promote local tourism.However, charge per room-night,either alone in the Restaurant,Hotel, and room-tax receipts often are or in combination with an ad Institutional Management Depart- collected for other purposes,such valorem tax.These taxes may be meet at Purdue University, where as general support of the imposed either in place of or in Joseph A Ismail, who has ten addition to a general sales tax in a years'industry experience, is a 01982,Ceram Univera ty. community. Ph-D. candidate. 84 THE CORNELL H R.A. QUARTERLY 16: 52 FROM CLIA -- TO 0805544F '1540 P.03 ii !/41 Roo `� ZMIG f3(,L �., rte• T} FR;'S To MUCR ' ?; To S5V 0 E. . Wv Co Uo 74E- Room IS • PENSIVE L, %ll.wJ 7744V /rim' D g 03/11/1993 16:53 FROM CLIP TO 180554406961540 • EXHIBIT 1 Price elasticity of demand for various industry segments in terms of loss in the number o' Number or Rooms rooms rented and drop in per- Room Rates 1.150 151-300 301.600 >600 Average centage of occupancy at various �Sao.00 -.40 -.19 -.OS n.a. •.34 levels of taxation. s40.013-74.99 -.68 -.28 •.16 -.07 -.38 The overall elasticity relation- 575.00-95.99 -.91 •.44 -.18 -.10 -.38 ship was measured at-.44(see ),Slog-Do n.a. -.72 -.34 -.10 -.67 Exhibit 1).That number means Average -.78 -.38 -.21 ..09 -,44 that for every increase of 1 perce-` age point in the tax, which source:eased on PurouerAHSMA Model.•lmpa=o1 Room Taxes on 1he Lodging industry'Mardh 1991amounts to a 1-percent increase in room rate,one would expect to have 0.44-percent fewer rooms able popularity,with little or no An additional question to con- rented per day. consideration for the impacts of sider is the nature of the consumer If that doesn't seem to be a large the tax on the lodging industry. response to a room tar.,or,indeed, figure,let's examine the effect of Until recently,the general to any increase in room rates. that demand elasticity on a typical consensus regarding room taxes Some observers suggest that guests property.The U.S.average room has been that such taxes have have little alternative except to pay tax was measured at 9.8 percent in little adverse effect on the lodging the tax if the tax is applied uni- spring 1990,including lodging- industry because the taxes are formly in a given metropolitan specific taxes,general sales taxes paid largely by businesses indi- area.Others point to-the options applied to rooms,and taxes rectly or by people on vacation available to guests.One of them is assessed by all state and local with relatively,high incomes. to stay in less expensive rooms so jurisdictions.3 At that level of tax, Indeed,early studies of this that the total outlay is about the the industry as a whole would subject seem to confirm these same.Another is to stay in the next experience a decline of 3.1 percent- assumptions.'Demand was found county or municipality,which may age points in occupancy rate,and to be:relatively inelastic;that is, have lower taxes.Travelers may the average property would record relatively large price increases also stay with friends or relatives, a loss of 5.3 rooms rented per day. were associated with relatively or shorten their stay by a day or Effect by Seg ' rits as small decrees in quantities of two.Of course,some guests are not services purchased. concerned with costs and therefore Data on price elasticities and More recently,people are will make no change in their resultant impacts on room rentals beginning to question the earlier behavior. Obviously,the reactions are presented for 16 industry studies and the conventional will differ among various guests on segments in Exhibits 1 and 2 wisdom that the taxes have little the basis of their sensitivity to because we found that the tax adverse impact.In a study of prices- effect differs significantly among Hawaii,for example,J.Mak found CIf R different parts of the industry,as that the effects there likely are The OSoOOM Tares one might expect.The data are quite large.'Furthermore,the tax The effects of room taxes on the stratified into four different room- rates are getting high enough that lodging industry were measured in rate segments and four size-of. they cannot be ignored.When a statistical analysis based on a property groups within each confronted with a double-digit tax national survey of the members of rate segment to reflect these on a$100-a-night room,guests the American Hotel and Motel different segments. An individr^'. have been known to be quite Association(AH&MA).We derived property's approximate price upset That,in itself,indicates an estimate of the average price elasticity is determined by that room taxes must be having an elasticity of demand for lodging selecting,the appropriate size--,7,111 impact izesr- impact on consumer behavior. services in-the United_States. property and room-rate category Development of the model is within Exhibit 1. IJ.H.Combs and B.Elledg%'E9yects of a lamed in the box on a 89, , Room Tax on Resort Motela&tcls,Nadoael Tat exp p JA.Ismail and S.J.Fiemstra.'Room T=•-. Journal,3Z No.2(1979),pp.210.207;and and the results are presented in A Growing Burden on the Hospitality Industn " J.Mak sad E.Nishimura,'rhe Economics of a the an accompy ying tables b The BcaomUne.6.No.2(April/May 1991). Hotd Rom Tale,'Journal of Tmvel Resewch, pp.20-28.Also see:Hiema.ra and Ismail. 18(1979),pp.2$ various industry segments,as 'Amounts and Types of Roma Taxes Loci-a w. V.Mak,'raldng Hotel Room Ffentsh in the the Lodging Industry.'April 1990,Informsu.... 1s Ja�aat of t Research.27(1988). defined by room rate and size of "7 Center.AH&tdA(1301 Nc�v York Ave.:r.�.., p.10-1s. property.The results are expressed washingun,.P.c.20oos). 86 THE CORMELIL-H.RA QUARTERLY -1-, 11/1993 16: 54 FROM CLIA TO 0605544 1)1540 P.05 s EXHIBIT 2 B folio the same procedure Drop in number of rooms rented and impact on occupancy rates Y wing P associated with various levels of tax rates with Exhibit 2,and also selecting the appropriate tax rate for its Number of Rooms community,a property's manage- Room- 1.150 151-300 401.500 A00 ment can approximate the effects Rate Rooms oea Rooms ox. Rooms Oce. Rooms Oce. ,f the tax on occupancy and Groups Per Day Rate Per Day Rate Per Day Rate Per Cay Rate number of rooms rented $40,0D Selection of the segmen?s for g 1% -0234 -0271%-0.252 -0.129%-0.203 -0.051% a.l:alysis was based on the results & 5 -1.17 -1.36 -1.26 -0.64 •1.02 •0.26 Not of the statistical model used.As ,: 10 -2.34 -2.71 -2.52 -1.29 •2.03 -0.51 Available can be noted from the model in the a 15 -3.51 -4.06 •3.78 -1.93 -3.04 -0.76 box on page 89,room-rate and 020 -4.68 -5.42 •5.04 2.58 x.06 1.02 property-size categories were !40•a0A4.99 -z on the most significant vari- $ 1% -0.382 -0.434 -0-400 •0.186 -0.420 -0.113 -0.425 -0.060% B a 5 -1.91 -2.17 -2.00 -0.93 -210 -0.56 -2.12 -0.30 ables in the model.The segments 10 -3.82 -4.34 -4.00 -1.86 -4.20 -1.13 -4.25 -0.60 were chosen rather arbitrarily to =15 -5.73 -6.51 -6.00 -2.79 -6.30 -1.70 -6.38 -0.90 uiv;de the sample into meaningful 3 20 -7.64 -8.68 -8.00 -3.72 -8.40 -226 -8.50 -1.20 groups of somewhat equal size. •g9 The room-rate segments were 1% -0.618 -0.680 -0.607 -0.297 -0.611 -0.135 -0.614 -0.073 identified as(1)less than$40 per 5 3.09 3.40 -3.03 -1.48 -3.06=• .-0.68 •3.07 -0.36 dav, (2)between $40 and$75,(3) 10 -6.18 -6.80 -6.07 -2.97 -6.11 -1.35 •6.14 -0.73 between 875 and$i00,and(4) =15 -9.27 •10.20 -9.10 -4.46 -9.16 -2.02 -9.21 -1.10 •e 20 -12.36 -13.60 -12.14 5.94 -12.22 -2.70 •12.28 1.46 $100 and over per day.The four $100 00 -:c-n-size groups were(1)fewer 1% -1.026 -0.508 -1.044 -0.262 -0.880 -0.076 Lnan 150 rooms, (2)between 151 ¢ 5 Not -5.13 -2.54 -122 -1.31 -4.40 -0.38 2nr1300 rooms, (3)between 301 10 Available -10.26 -5.08 -10.44 -2.62 -8.80 -0.76 .' 600 rooms,and (4)more than '15 -15.39 -7.62 -15.66 -3.93 -13.20 -1'14 vvv rooms.The resulting 16 3 20 -20.52 -10.16 -20.88 -5.24 -17.60 •1.52 categories conform to usual group- Source:e ings,but they are not necessarilySued°"Purouea lino Modet nntimum.Data for two of the -cements were omitted in both property with under 150 rooms and the local government.This conclu- ,.ables because those outlying an annual average nightly room sion was tested in the statistical Camps lacked a sufficient number rate between$40 and$75,the model and verified by the results. _: :rnple observations for reliable approximate elasticity is-.68. In Exhibit 1,average elasticities estimation even though property At the mean number of rooms for each room-rate category are was used as the basis for and room rates for this particular given in the far right column,and .�Lratif}ing the original sample. segment,a.68-percent decline in the average elasticities for each number of rooms rented normally property-size group are given in Examining Elasticity will be expected for each 1-percent the bottom row.These averages are To use the table in Exhibit 1 for increase in price reflected in the more stable than for the individual :s_essing the tax effects for a room rate.This increase in price cells.They show that,on average, specific property,one needs to should be interpreted as being the price elasticities decline(in locate,at the top of the table,the above the cul rent rate of inflation absolute terms)as property sizes appropriate',Number of Rooms" in the'economy,as perhaps mea- increase and that the elasticities range within which the property is sured by the Consumer Price increase as room rates increase. identified.Then,locate the appro- Index.All net additional price Intuitively,one might be surprised priate"Room Rate"range for this increases to the consumer would be that higher room-rate segments ^*nperty.The numnPr at the inter- expected to have an adverse impact face more price-sensitive customers _ection of the selected column and on consumer response.It makes no than do lower room-rate segments. row is the price elasticity for the difference whether the price However,in a sense,higher room- =;went exhibiting the selected increase was due to an increase in rate groups•perhaps face stronger ;:o:nbination of number of rooms the room rate charged by the competition than do lower room- s. and room rate.For example,for a property or due to a tax added by rate groups.If rates increase, OCTOBER 1992 87 03/11/1993 16:54 FROM CLIA TO OP"554406961546 ;nests can easily"trade down by is equal to the effect of a 5-percent rate would be about 3 percentage 7oing to a budget property, rate plus that of a 1-percent rate. points higher,or about 68 percent, This calculation is possible because in the absence of all room taxes. ..ffect on Occupancy the effects by segment are linearly 'These are not Trivial results.A ;xhibit 2 shows the conversion proportional over various tax rates• change in occupancy rate of 3 rrom the price elasticities shown in That is,the effect of a 2-percent tax percentage points a substantial .hlbit 1 to actual declines in is twice that of a 1-percent tax,and gap that often would make the .erms of number of rooms sold and the impact of a 20-percent tax is difference between profit and loss. :.he resultant drop in occupancy approximately twice that of a 10- Moreover,the impact varies :ates.As in Exhibit 1,the data are percent tax.The statistical model substantially in different segments presented for each of the 16 room- was specifically tested using of the industry.The effects were rate and property-size segments interaction and squared terms to found to be proportionately highest previously identified_However, measure any lack of linearity in the for the smaller properties and F,xhibit 2 adds a third dimension data,but such terms were not those charging relatively high room by listing effects at various tax-rate found to be significant(with the rates.But the adverse effects of levels rather than showing results single exception noted in the room taxes on industry sales are only for a 1-percent change as in model). considerable for all segments of the the case of Exhibit 1.This third As noted earlier,the adverse industry. dimension makes the table a bit impact of taxes on the number of Tmistaafl.'We conclude that it more complicated but it eliminates rooms rented was found in this is not true that-taxing room rental some calculations for the typical study to be the same as,a compara- is a"free lunch"as some have user. ble increase in room rates,after claimed.The lodging industry finds Use of Exhibit 2 involves the allowing for inflation.Some itself as the target for"taxation same procedure as outlined for the observers have questioned the without representation"by state table in Exhibit 1,with two addi- validity of this finding on the basis and local officials Iooking for tions.First,for each segment that taxes are assessed at check- revenue without having to face the ;dentified by"Number of Rooms" out and that tax rates are often not taxpayer at the polls. Information nd"Room Rate Group)*the advertised by the lodging that.is available f com earlier impact of taxes is given in two establishment. studies suggests that the upward columns both in terms of changes However, the statistical model trend in tax rates has been sub- in number of rooms rented per day was run by defining room rates stantial.Witness the recent tax and changes in occupancy rate. both with and without room taxes increases in New York City and Secondly,these two measures of added, and the resulting effects Chicago of about 5 percentage impact for each segment,are_given were almost identical.Certainly, points. for five levels of taxes ranging from the fundings were not significantly On the other hand,room taxes 1 to 20 percent.The appropriate different.This finding verifies the offer some offsetting benefits to the level of tax rate to use is the total maxim about fooling some of the lodging industry from the use of all room taxes that prevail for a people some of the time,but not all made of the tax receipts.This given property in a local com- of the people all of the time.After study found that about 22 percent munity.However,the effect of paying high"exit taxes"once or of room-tax revenues were being taxes from different sources(e.g., twice,price-sensitive guests are on used directly for some type of county sales tax,city occupancy the alert for those add-ons. visitor-related purposes,such as tax)can be determined separately supporting activities of convention because the effects of each tax are Not Trivial and visitor bureaus and supporting additive.The occupancy rates As we stated earlier,the results the operation or construction of indicated are given in terms of showed that when the average civic centers.It is also known that percentage changes, elasticity of-.44 was applied to a many state-and local areas use It is possible to determine the total room-tax assessment of 9.8 some general funds`or these impact of tax rates other than the percent,nearly 5 fewer rooms were purposes as well. five levels represented by simply rented per day by the average Atter making an allowance for multiplying the tax impact for a property of 107 rooms.Applying 1•pexceat rate by the actual tag this loss of rooms rented to the "TherC ain't no such thing as a free lunch." See.for instance:Rabat A Heinlein.Thr Noon rate for that segment.Similarly, average occupancy rate of about 65 1,7t=Haran mjur ae(Flew York:Aa Books. `.he impact of,say,a 6-percent rate percent implies that the occupancy 19877). 88 THE CORNELL H.R-A. QUARTERLY 03/11/1993 16:55 FROM CLIR TO 080554406961540 P. �r Deriving the Data , j1.The first step in the study was to here. It included a number of variables 4.Then we multiplied the statistical !. conduct a broad survey of individuai to explain statistically the tactors pric"uantity relationships(elasticities) j properties in the lodging industry to associated with differing numbers of by the tax rates,to estimate the overall t collect basic information about the rooms rented among the sample tax impacts on the lodging industry in : behavior of their guests in relation to the properties.Only by holding constant a terms of number of rooms not rented. tax.A stratified national random sample large number of these factors is it Those results were translated into of the membership of the AHBMA was possible to measure the net relationship overall impact on occupancy rates. used for this purpose. Usable informa was between room rates and number of 5.We applied the resuits of the model tion was obtained from a total in 375 rooms rented.The results of this to various Segments of the industry,the individual properties. analysis were used in calculating the results of which are presented In Exhibit, 2.We determined how much tax was price elasticities of demand found in 2.This step amounts to disaggregating I being assessed on the lodging industry. Exhibit 1.2 the overall totals in step four into their This process proved to be complex.We components.This process is accom- j turned to several different sources to 'For tuner intomtation on the levels of taxes plished by holding constant most of the determine the tax rates on urcefound and how the tax rates were Oetem+med.see variables in the model while varying,in I lodging, Hismstra and tsmafl.1990. tum,the values of the segment of j j including Gavel international Directory, =Applying oemand parameters developed from published by Meetings& Conventions c ;sealo dataifetC behavior interest, shasn m rates or reof Magazine a report by the Advisory � esa changes can be grope n othe results a approximated by studying responses of different applied to the various levels of taxes 1 Commission on Intergovernmental individuals to Common variables after adjusting for Relations, Signrfia:ant Features of ditierences in those variables among the assessed on properties in those Federalism:and 1989 survey data from individuals. segments.-S.J.H.and J.A. i. I{the International Association of Convert- tion and Visitor Bureaus.These major j sources of secondary data were supplemented by a survey of state The Demand Model ' offices in all 50 states. t Tax rates were identified by conven- The following are the statistical model and summary statistics fmm wt+irh the elasticin.n; tion and visitor bureaus and by state, demand for lodging services was calculated.Demand is measured'.r. .mc of numD^• as well as by type of taxing jurisdiction rooms rented.and the price elasticity of demand was measured at - .:,ut the weigt:'.. and to of tax.In particular,taxes sample means of average room rate.Data were trom a "ndoii, were identified to the extent that they of about 375 respondents that were members of me AH&MA it;spi i a7w. were lodging-specific as opposed to being general sales taxes applied to Frot"binty ? sample weiui-.: this industry. In addition,an attempt variables CoefRdents T Values >T •. Means Me'r' was made through phone calls to the , states to identify the extent to which Number of rooms rented= 242.63 1 C use of the taxes was lodging-related.' Intercept 94.16 (12.1) .0001 - 3.Next,we analyzed this information Average room rate -0.72 (-3.3) .0002 75,52 65• ) to determine the statistiW relationship F&B revenue/day 0.0048 (172) .0001 11246.73 4266.S:i t between room rates including taxes Guess: business 0.86 (4.01 .0001 40.87 45.85 1 and the number of rooms rented,after conference(°i°) 0.68 (22) •0258 21.81 allowing for differences among the Ownership:independent -26.57 (-2.6) .0111 .67 r properties due to size of property, City population:<100 •27.62 (2.6) .0091 .57 average room rates,types and Property size:1-150 mms -257.69 (-11.5) .0001 .35 t location of properties,and ownership 151.200 -21.9.96 (•10.7) .0001 .26 and management of those properties. 301-600 -164.06 (•9.5) •0001 .25 t Similar relationships were measured Room rates: $1-39.99 -89140 (-3.9) .0001 .13 f for room rates without room taxes to $40-74.99 -74.56 (-4.5) .0001 .40 , see how the relationships compared interactions: ' with room rates including taxes. Guests tourists x no.Mrs 0.0051 (122) •0001 For this purpose,we established a Room rate$75.99.99 x cross-sectional,multiple-regression property size 151-300 -5128 (-2.1) .0325 model.The final model used is shown Rz=.924;N�310 general ftcls used for lodging- Note:The above results are"M a multipie4"ression analysis using a Prac Reg statistical program related purposes,we estimated from PC W.Souroe:Purdue universitylAH&MA Lodging Survey.-Analysis of Room Taxes Levied that the equivalent of about one- half-of ne- halfof all room taxes collected goes to support lodging-related.activities determine the efficiency in use of study of this question would be a in some way.However,it was these funds in generating increases logical f0Uow.up to the study O beyond the scope of this study to in rooms actually rented.Further presented here. Co OCTOBER 1992 89 M" -ING AGENDA Mr. 3 ITEM # Dear S.L.O. City Council: As a prominent businessman in S.L.O. I would like to comment upon the current funding request of our police department. I question why they should be treated differently than other types of public service areas subject to budget cuts. When I see adds like the one the S.L.O. police department sponsored in Mondays Telegram Tribune I become concerned. The use of scare tactics with emotional crime issues to maintain financial security lacks integrity and is in "poor taste" . Please recognize this a current trend whereby law enforcement attempts to hold society "hostage" if they are not funded as they see fit. The issue of crime needs to be considered rationally without threats of rape and murder. I feel community involvement and neighborhood cooperation is a far more efficient tool. In many ways this type of solution is difficult when" enforcement for revenue" takes precedent over "protection of the people for the people" . I ask you consider these concerns because they are representative of many who reside or work in S.L.O. . We recognize the necessity for police, however, there are other necessary programs that need continued funding such as education, health care, and environment, which ,J contribute to the quality of life in this beautiful city. Sincerely, A Concerned Citizen COPo�AcLon z D ;ia.� " 993 ❑ 1� 20�Co`-mc1 DDIR CITY COUNCIL YCAO K FIN.DIR SAN LUIS O'ISFO, CA VACAO ❑ FIRE CHIEF V ATTOR NEY ❑ FW DIR. CLERK/OTIC. ❑ POLICECFi MGMT.MVM ❑ REC.DR ❑ C READ FILE ❑ UTIL DfR. Full Council has IF l.E �P bliC received this document este t!e(gear�iwwif VVk MEETING AGENDA ■ � DATE "`3 till 8= E MCLIIITOCKS SALOON&DINING HOUSE ---- - March 9 , 1993 Full Council has �1tAR 4 )�i61,i received this document CITY COUNCIL SAN LUIS Oa;Spp, CA The Honorable Peg Pinard Box alio San C; tin �1 San Luis Obispo , GA 93403 Dear Mayor Pinard: I am writing to express my concern in the council recommendations to cut our police services budget and decreasing the number of officers on the street that not only protect my business interests , but also the personal protection of my family. In the San Luis Obispo of today, there is increasing crime and criminal elements as attested to in the newspaper , television, and by the increased gang related programs that are seen in our schools . These problems are not going to go away. They are on the rise , and it is necessary that you in the City Council be realistic about these special social changes that are happening in San Luis Obispo city and '': county. Now is not the time to cut police protection or police programs . I realize that in today 's recessionary trend and budget crisis that we all need to be aware of budgeting , however, I do feel that there is less important excess in our city government that can be ,alleviated before ever thinking about police services that are important to the protection of its all . Unfortunately, law enforcement protection is a factor that is becoming more necessary everyday. Please keep these basic ideas at the forefront of your thoughts when your are v tin 'sAAI t is for our city and our families . jPr COPIESTO: i n y r t a l i ❑*Denotes Action ElFYI s i nt `dCaunol ❑ DDDz CAO FIN.DIP. V, Luff ❑ FIRE CI MF V ATTORNEY ❑ Fw D13L TO/nb UrCLc�ftK/ORiC. ❑ POLICECR ❑ MCMT.TFA1+1 0 rFc Dim ❑�,ch FILE C1 uncut 750 MAITIE ROAD • P.O.Box 239 • SHEu BEACH,CALIFORNIA 93448 • FAX(805) 773-5183 • OFFICE(805)773-3050 • RESFRVATIO\S(805) 773-1892 MEETING 93AGENDA March 11, 1993 DATEsL,�=—TEM # COPIESTO: 1 ❑'Denotes Action ❑ FYI VCocnci1 DDIR Full Council has Aldora Santos VCAo Qf FI1q.DIR ��thisdocvmeTt ACRO ❑ FIRECHIEF 631 Caudill S t. ATTORNEY ❑ Fw DIR. San Luis Obispo Ca 931 ]VCLEPK/CP.iG. ❑ POLICE CR ❑ MCMT.Tr_A%1 0 REC.DIF O_ rDF.LE L�.UII agLNf_. To Members of San Luis Obispo City Council: In the pest by closing your eyes and not concerning yourself about the plight of our citizens , our beauti- ful city is dying. Business like J.C. Penney, Montgomery Wards and T.A.W. , naming only a few had to close its doors. Sears and others had to relocate because of the high rents. You have discouraged instead of welcoming new busi- ness to our city that would create jobs and revenue. Downtown looks like a War Zone with all the vacant build- irgs . Now you wart to distroy whet is left. We could boast ar.:d be proud of our clean city and beautiful parks. We have a responsible fire department and po3-ice force, me to be proud of. For the size of our city, '• crime has beer kept at a minimum, cut our police force "Boom" Crime City. So now, you think we can do without city maintenance. . Our city streets will become filthy, full of grime and papers floating in the wind. Chuck holes, to ruin our cars and bicycles , cracked and broken sidewalks just waiting for a accident to happen. You better have good attorneys on hand beeause of the law s,A is which will be filed. Our parks Pre neat and clean. These things can' t be done by volunteers. Sure we, that clean in front of our property, pick up in the parks will con- tinue to do so. Those thpt don' t, won't! We fire proud of our clean city and call it the jewel of the Cental Coast. Why do you think tourists and businesses wants to come to our city? It' s sure not for the recreation. It' s for the quiet, crime free, clean city. Who keeps the Mission Plaza clean, watered, pruned etc? Not the Homeless! I'm glad that we can take care 1993 CITY COUNCIL SAN LUIS 02:SP0, CA of them but it is the city employees that maintain It for us and the tourists . Don' t cut back on city employees , loss of a well maintained city will be loss of tourists and new business which we depend upon. May I suggest instead of laying off police., fireman and city maintance workers , . as employees retire or quit don' t replace them if all possible. By laying off these people you are displpcing whole families. Where will they go? Out of state or to join the home- less. I believe that the defecit needs tc be reduced. But you' re talking about chucking the Emerson School property, al :-e;idy a lot of money has been invested In property and plansfbr the new fire station. Now you want to buy the Southern Cal Gas Company property. . where is the money for that coming from? The Per- forming Arts building, the courcil had their heads In the sand when they approved a joint venture to build this on Cal Poly Campus. Poly will hpve first use of it, good luck waiting for the city to use it. So stop throwing money away , wait till the economy Improves. You must er.courpge large stores and businesses to locate here , and make it easier for them. Put out a WtLCOrE MAT, not a NO TRESPASSING SIGN. Keep our sales tax hFre, not in Santa Maria. Even Paso Robles and Atasc--dero have better, 1prger stores. Say yes to these businesesses , and welcome them to beautiful S.L.O. I' ve lived here for 53 years and raised my family here. I'm proud to call SLO my home. Lets keep it that way by looking forwprd to a new .prosperous beginning. By slashing city jobs you will be slashing our city' s throat . Concerned citizen and tax payer! Sincerely, Aldora Santos M 'ING AGENDA DATE Ila-13 ITEM # COPIES TO: ❑'Denotes Action ❑ FYI VComcil ❑ADD DIR YCAO F7PI. Q///'ACAO ElFIRE CHIEF nD.%IEY ElFW DIR r, CLERK/ORIG. 13P01ICECH �L`%J ❑ MGMZTF.AM CI REC DIP. C!T� COU: ❑ LML DIR YCIL ❑ READFIL£ SAiJ LUIS Oi;;;>P0, CA 288 Del 'far Court San Luis Obispo , California 93405 March 8 , 1993 Full Council has received this document Councilwoman Penny Rappa , City of San Luis Obispo Dear Penny , You have a tremendous responsibility along with the other council members in dealing with the city budget cuts . With so many cuts to be made , it must be very difficult . It is very disturbing that our city administrator and his staff are recommending so many job cuts amongst the long term employees . It doesn' t seem like seniority carries any significance . If positions need to be eliminated , I would think the city would have a lateral transfer or have the option to bump down . Moreover , it is hard to believe the city would cheat these long term employees that are within five to ten years of retiring out of a fair retirement . Most of these employees have had a long term love affair with San Luis Obispo and have established deep roots . Like you , they take great pride in seeing the positive changes that have occurred . Penny , good luck to you and your fellow council representatives as you face the challenges of balancing the city budget . Sincerely , )Xan Wilson Mr"TI'3G-/�93 AGENDA S DH,� ITEM # u� San Luis Obispo City Employees Association P.O. Box 8100, San Luis Obispo, CA 93403.8100 COPit2- TO: i ❑•Denotes Action ❑ FYl I March 11, 1993 l(Councd ❑ CDD DIR. 9 CAO E(IN.DIR. V A0W ❑ FIRE CHIEF l A770RNEY ❑ RV DIR. CLERK/ORIG. ❑ POLICE CH. TO: Honorable Mayor and C' Council ❑ C READ-LE U P.Ic DIR. Y �Y , ❑ C P.1+.D FZE EJ.LTIL BIP.y.� FROM: San Luis Obispo City Employees' Association SUBJECT: Proposed "Downsizing of the Organization" We know you are being pulled in many directions at this time, and we hope you will have time to review and consider yet another idea. All facts seem to show the most appropriate solution to our projected long-term ailment is a reduction in the work force. To this means, the City Administrative Officer has proposed some reductions to the work force. The philosophy behind these cuts is to make them quick with little regard for morale, then rebuild the organization. This seems to be a callous approach to an already stressful situation. It is agreed that something must be done in the way of bridging the revenue/expenditure gap. In this bleak situation, there are still opportunities we hope the council will take advantage of to enable the city to flourish once again. There are areas in the CAD's proposal that we are in agreement with such as increasing fees and taxes, and trimming departmental budgets to a bare minimum. The area of disagreement is in the CAO's philosophy about personnel cuts. The SLOCEA cannot go along with such a reduction proposal. (We find it interesting that the proposed management cuts are only within the technical and mid-management areas.) It is felt by the association that if a reduction in the work force is necessary, it could be accomplished through attrition, combined with some training and departmental restructuring. We would request the Council to empower Administration to use some reserves and create the incentives for retirement which would allow a reduction to the work force on a voluntary basis. The net effect would be an immediate rise in morale, possible training or transfer opportunities and refilling vacant positions, alleviating a portion of the unemployment in our community. A;AR � > ' J CITY COUNCIL SAN LUIS OB;SPO, CA DATE 3-45-23 TEM # MEMORANDUM -------- March 12, 1993 To: Honorable Mayor and City Council Members From: The Mid-Management/Confidential Employees' Association Subject: LAYOFF MITIGATION The employees'association supports the recommendations of the City Administrative Officer and encourages the City Council to strongly consider additional revenue enhancements and employee concessions in an effort to prevent loss of essential services and employees of the City. We recommend that the Council direct Administration to negotiate jointly with representatives of all associations and return to Council with specific recommendations to protect vital community services which will be jeopardized by the loss of essential positions. Respectfully submitted: n. Mid-Management/Confidential Employees' Association President, Dennis Cox COPIESTO: ❑/•Dewtes AcSon ISE ❑ FY1 coup . ❑��DDIR ICAO hG FIN.DIR CyY AG1O ❑ FIRE CHIEF A-ITMNEY ❑ FVV DiR. CLERK/ORIG. ❑ POLICE CH. ❑ MGMT:TEE^rl ❑ REC DIR MAR 1 1993 CITY COUNCIL SAN LUIS OBISPO, CA MEETING AGENDA . DATE Dear Council.Member: We supportour police ofFacers and are opposed reduction in police."personnel or'poIice servi � a COMMENT: TIVrC rm�si �� Some blip tui 4u�a c_ 11' C'" of he r 4+ A-VI c am a NAME: IGNATURE: ADDRESS: - w ' f SIGNATURE: C4 PHONE: 5N7V 0c�o7 k ,—✓' tab '�''� wyn.ya 'T S..wyar"rh ��txg0,kk� � �0' vo-'S � y, i `Dear Ceuncil�'Member: V`Zupp?ort our oliee officeµrsa Arid ;are opposed to .a •'' ,°-` • �gv ♦ rt'� a..ars -6 tx f 2 .� +„ • it�. -„s. • i 2reducfion m poUce personnel or policeF services. - . ,COMMENT: tQLa 'asi1:I'O: 0 i����� w� L1/ 'rw�+`'W« x�� viu "CrC<.r" s+� y.;d,�s,v"na" .d. "�.Y.r t'k&"c�tx♦"` ._�F�� .'E. a •tJaWtai Action ❑ f 1, „ • ,. ;�� q C 4 '�✓. y'^� <` �"Y Ycotmal ❑ CDDDIR r ]L/ � CAS ��EL9 .Vt�. ,7 d z P.i •ss 45',<� Y' ,a►t""s�. �'.a �a + ACAO ❑ FIRE �iX A—j TMJL I ❑ FW DI\. X L Av CLERK�CF-C. ❑ POLICE L° X63 4��r E `i Cl mGIv[?.IcA11 ❑ RECDIRm x � rv <'a, Lit`xwt a ate. *s, 'a- Yt Yt`n<a u� N "x t �. JrCwSDF',LE Q urILO �'�5"tr 77 _- }NAME• �� GNATU 'r, �i{`�' 1131 - dFti,..,A .?.^ � r ADDRESS: ; ea «yxa v;*r " >ri�r"'Xgf} a^"'-t: 't°"F'yi ,� `' < ,k ` A��k'7�,� .' .� as ..x�a� } ACL Y.�w s tX Jyy�,�"+y"t„�1�PONE.�•�l �r \�/./���} } ,,. .;,x.�yvi4. -4t•�' Y A .h'S+ �'e �`.+.. '-1" -..3 ski r��ti Rdiro� e �1r .Y ' ysw.++•'t6� �X�rP � ,�,Y, iyb� rot 4�� ^r��+�".+,vw��s .. ��xx �- r ---Isd�' a a.z.x, ,,w d it:µ MEETING AGENDA I -� Dl'" 3-/,5-9 3 ITEM # Dear Council Member: We support our police officers and are opposed to .0 reduction in police personnel or police services. COMMENT: s . NAME: &:L2�r E/ T' Lr�«tC�- SIGNATURE: ADDRESS: SIGNATURE. MAR 1 :' 1993 CITY CLERIC SAN LUIS OBISPO, CA Dear Council Member: We support our police officers and are opposed to a reduction .in policepersonnel or police services. COMMENT: fc1' ,1�� �' fir NAME•,,Z.r �i • S(GNATURE• ADDRESS/ ¢ SIGKIATURE: ' - aif�i� ,y+ PH,ONE �—.3 UAP 1 t4o . l MiEET' ' AGENDA / DATE =-1 "93 ITEM #_._1---- Dear.Council Member: We support.our police officers and are opposed to a reduction in police'personnel or police services.. COMMENT: iDOPJMTO: ❑-Denotes A,&,, ❑ FYI U 0 U 'Cama1 ❑ CDD DUL �7 CAO B'RN.DIR. rA0 ❑ FIRE CHHIEFF iIOr:4EY ❑ FN DFR € VA -rte's C❑i POLICE T>� C NAME: _SIGNATURE: ❑iC,$EADF7s 1:1 UII�DIfC. Fla • S: 1(�� SIGNATURE: ADDRES �. Q1lQN.a, PHONE: 5t(3 �o l q7 Dear Council Member: We support our police officers and are opposed to a reduction in police personnel o o ice services. COMMENT: .. t 1w a! VT( gip!;:;C ;. GF. NAME: �g4 Q ,/SIGNATURE: ADDRESS: 2 SIGNATURE: 3 -a PHONE: �y9vb EMBASSY Su TF_5®HOTEL 333 MADONNA ROAD MEETING ADENUA / SAN LL,SOBISPOCA 93405 DATE ITEM # — �,BS549BB 7MBASSY FAxaos-sassz7s SUrrESs" FOR RESERVATIONS CALL -' - - 1-800-EMBASSY March 12,' 1993 Mayor Peg Pinard CITY OF SAN LUIS OBISPO City Hall San Luis Obispo, CA 93401 Dear Mayor Pinard: Tourism is the lifeblood of this community. To raise our bed tax is to discourage tourism; which ultimately will lessen bed tax revenues. Embassy. Suites alone contributes approximately $350,000 per year in ,bed taxes to the city of San Luis Obispo. In 1991, 'when the Transient Occupancy Tax was increased from 6% to 9%, our business declined 4%, which equated to $13,000 in lost bed tax revenue for the City. Based on our knowledge of the industry, and considering what happened. in 1991,. we would anticipate a loss of $90,000 in rooms - revenue, • if the bed tax is once again increased. That would represent $9,000 in TOT revenue. , Increasing the TOT will discourage the ever-important tourist from traveling to San Luis Obispo. They' do have a choice. This urgent appeal is sent in the hopes that the City Council will work toward another viable option for achieving .a balanced budget. Thank you for your consideration. Sincerely, Sue rnall Gene al Manager COPIt'S, TO: ❑ SA:taS �/*Denotes Adim ❑ FYI LI Quncil `DD DIL r� Q ACRO AA❑3 FiRE�i-i3EF ATrCIVEY =❑ FW DIR. Sr a.mx/O 1C-. [a POUCE 01 R ] �� 1993 ❑ MCMT MMM CJ RM Da ❑ CREADM ❑ UTTLDIR. CITY COUNCIL SAN LUIS 031SF0,.CA MEETING AGENDA DP" ITEM # i��ll�llll�llllll811111��������@IIIIIII II � IIII C "tOf SiAn k-11 S_ OBIS 990 Palm Street/Post Office Box 8100 • San Luis Obispo, CA 93403.8100 TO: CITY COUNCIL. FROM: MARION WOLFF, HUMAN RELATIONS COMMISSION CHAIRPERSON RANDY BAUDENDISTEL, GRANTS-IN-AID CHAIRMANO SUBJECT: GRANTS-IN-AID FUNDING FOR THE 1993-95 FINANCIAL PLAN The Human Relations Commission has reviewed the City Administrative Officer's recommendations for Commission funding during the 1993-95 Financial Plan. While the Commission understands that the City is facing serious financial constraints, we still feel it is extremely important that funding for the Grants-In-Aid Program be retained at its current level ($85,700). Given the state of our local economy and the loss of funding at all levels of government, the community will only rely more heavily on programs supported through the Commission's Grants-In-Aid Program. In fact, we received three additional requests for funding from agencies for the coming Grants-In Aid cycle (a total of 31 requests; up from 28). It is also important to add that the Commission has already given up,its reserve of $5,000 which, represents a 6% loss of funding in an effort to cooperatively resolve the City's fiscal problems. Again, we strongly urge the Council to retain full funding for the Grants-In-Aid Program. Please feel free to contact either one of us if you have additional questions. cc John Dunn COPIESTO: ❑•Denotes Action ❑ FYl VCouncI ❑iCDDDIR VCAO �FIN.DSR 9 ACAO ❑ F1RE_t IlEF 9?0VrOMQ-Y ❑ TW DR i2rCL£RK/ORIO. ❑ POLICE CH. I ❑ Md&TELIA ❑ P.EC,DIP. t r ❑�Cr EAADF.Le Q UnLDIR I �.�rt•: � .� �• _ Mj R 1 :, 1993 CITY COUNCIL SAN LUIS 0BISPO, CA OThe City of San Luis Obispo is committed to include the disabled in all of its services, programs and activities. Telecommunications Device for the Deaf(805)781.7410. N, 'ING AGENDA Southern California Chapter DATE 3" . ' 3 ITEM # Central Coast Unit ® ® 1160 Marsh Street,Suite 221/San Luis Obispo,CA 93401/(805)541-1721/(800)549-3f 537_FAX:(805)781-3165 ARTHRITIS FOUNDATION A CURE IS WITHIN REACH. coP1IBTo: ❑' Denotes Action ❑ FYI March 10, 1993 vcouncil ❑ CDD D11 5 CAO EN.D11 VACAO ❑ FIRE CHEF _ATTMNV . El nW DL � C3 P - ti Mayor Peg Pinard and City Council MGjXr.TEV4 ❑ rMDUL .. P.O: sox 8100 0 tFA Flu ❑ UnLD11 San Luis Obispo, CA 93403-8100 ' J - Dear Mayor Pinard: As the Executive Director of the Arthritis Foundation/Central Coast Unit, I would like to express my concerns regarding the possible cut in funds for tourism promotion. Every year the Arthritis Foundation hosts the Central Coast Wine Festival on the Saturday of Labor Day Weekend. The event is held in beautiful Mission Plaza. Eighty percent of the participants are from the Los Angeles Area (800-1,000 tourists) . Last year our. attendance dropped by 400 attendees. Part of this drop in attendance may be. attributed to the economy but, part may have been due to the cut back in the amount we have to spend on advertising out of town. �1 The proceeds from the Central Coast Wine Festival are used for programs and services for the residents of the Central Coast'. Several hundred residents rely on our programs to help relive the pain of America's number one disabling disease. If we do not meet our fundraising goals programs and services will be cut. Speaking on behalf of the Arthritis Foundation/Central Coast Unit Advisory Board we are strongly encouraging the city council to not cut funds for tourism promotion. Tourism brings much-needed .money into the city. This is the time when we. should be encouraging tourism, and we will all benefit. inc ely, Raynette ornej Executive Directo cc: All Council Members ".:R i 1993 CITY COLNCIL SAN LUIS op,: CA Please remember the Arthritis Foundation in your win. '"!�•� ryry!!}} 7 Licensee r .,an Luis Obispo 2750 Broad St. County Airport Clip COU;NC11 San Luis Obispo,CA 93401 901 Airport Drive IAN LUIS 06i' CA 8055443777 San Luis Obispo.CA 93401 Fax 805 7813057 Out o1 Town,Reser,lV A GG EMNG AGENDA o 1'!111���has 3,133 � ? ' mum received this document ®®V 7carl7ental March 8 , 1993 Dear Councilperson Romero : We own and operate. Thrifty Car Rental in San Luis Obispo. We understand that the City of San Luis Obispo ' s promotional funds are up for renewal , and ask for your serious consider•- - ation . regarding the importance of funding tourism promotion. Our two rental locations serve travelers arriving by airplane, train and bus , and local residents and business people who rent vehicles for out-of-town trips and local uses . This affords us insight into not only the amount and character of the incoming tourist trade , but also into how this major industry affects our local economy. We firmly believe that tourism benefits more than just the hospitality and travel- related businesses in our area. Tourism is a principle factor in the economic health of our total community. For example , Thrifty Car Rental , which employs twelve local people, is intricately dependent on both tourism dollars , and the residual effect of those dollars on the. spending capabil- ity of our local customers . In turn, we spend a considerable amount of .money locally each year on supplies , service's , and .DMV registration fees , which provide revenue for the : City. Because of tourism dollars , we are also able to support our community through donations to the Arts , Cal Poly, Hotline , Special Olympics , Rotary, The Police Benevolent Association and various other organizations and charities. Thrifty does our part to promote a good first impression of San Luis Obispo once the traveler reaches our "doorstep" by giving them a . warm welcome, friendly service , directions .and information on lodging , restaurants , and local. attractions . But 'we need help attracting them here.! Unfortunately, mass advertising outside . of the area is too cost prohibitive for most individual business owners . We depend on the City' s promotional funds to get the word out to potential tourists. Tourism promotion will keep much-needed revenue coming to our . city. Tourists -- even when they don' t rent cars -- spend money on local goods and services , help increase our local cash-flow, and improve. the economic condition of our county. We need tourism, and we need your support to keep' the tourism promotion funds intactl thank you ! COPIEST'O: ❑'DMWtesAction ❑ FYI Sincerely, Q/CDDDIR. CAO EZ FIN.di � � ACRO ❑ _FIREQm=F;. A7TOIM IEY ❑ FW Dut .. .CLERK/01ZIC. ❑ PO=CFL Robin Dudley Carl Dudley MQVTlEAM EJ REC.DIFL 0XJZFADKU El UM DR ME ' IG AGENDA DATA '1 3 ITEM # V,0 CITY COUNCIL SAN LUIS OBISFO, CA Tuesday, March 9, 1993 PUB Ccuncilhas received this docs nent Mayor Peg Pinard and City Council P. O.. Box 8100 San Luis Obispo, CA 93403-8100 RE: Don't Cut Tourism Contracts Dear Councilperson Dave: I think that, of all citizen groups, local business people can really commiserate with the .plight of budget planners. The stories and ads in the TT last evening certainly, reinforces the difficult decisions being faced= decisions with lasting effect upon the lives of co-workers. We have experienced this economic upheaval also, among our restaurant clients, for the last several years and have seen the demise of more than one good eating establishment due to the lack of travelers, diners, etc. Even though our City budget is really feeling the crunch now, travelers are beginning to re-appear and Californians are turning to the more frequent, shorter, closer 'vacation climes. We are one of the absolute prime areas for encouraging this type of destination. We really need; now, of all times, to continue to reach.previous visitors as well as.new ones. It would be worse yet to discourage those. who may be attracted by increasing bed tax rates. Please consider what has occurred. in Morro Bay. I understand that the city withdrew Tourism support and that they are "dying on the vine." This is the time we- should increase this investment, not dilute it. The return on those dollars could save some city jobs in the future, not to . mention the merchant hands those returns pass through! Sincerely, Wanda Strassburg San Luis Obispo Chamber Board Member cc: All Council Members ❑ Denotes AciSon ❑ FYl i � p�MDDM • Cro•nril CAO 65 FIN.DM i ' ' ,�/ACAO ❑ FiRECFnEF ATf.7Ri.�EY ❑ FW DM VcLmxro�c. ❑ PPcuCE CK ❑ MCMT.r�0+z G.r.ECDIR 3580 Sueldo San Luis Obispo, Califomia 93401 (805) 5436142 Printed on rec clew paper . 1EETING AGENDA DATE ITEM March 110*1993 f{!AR 1 ;1 1993 CITY COU.VGL SAN LUIS OBISPO, CA Honorable Mayor Peg Pinard CITY OF SAN LUIS OBISPO City Hall San Luis Obispo, CA 93401 HAND DEUVERED. Dear Mayor Pinard: On behalf of Sterling Hotels Corporation, let me voice an urgent appeal to you and the other members of the City Council to avoid .raising city bed taxes in an attempt to achieve a balanced budget. We, like all other hotel and motel owners in the City, have struggled over the past few years to maintain a quality product in an economy where across-the-board cutbacks have become'a way of life. A study.distributed last fall revealed_ that many .of the hotel and motel rooms in San Luis Obispo have been.vacant,. while our.neighbors to the north and south have enjoyed increased occupancies. This should be reason enough to avoid raising room taxes, whichwill result in increased room rates, and even more empty beds in.the City, diluting even further the volume of bed taxes collected! Tourism is a lifeline for this community. To take action that will further deter tourists from our city is .a ludicrous, .and. self-defeating prophecy. Please encourage your colleagues ,to vote against this drastic measure, and look for alternative ways to cut the budget. Increased bed tax.is not the answer. Thank you for your consideration. Sincerely, COKMTO: ❑ D=tm Acdm FYl C mcd p/CDD DUL STERLING HOTELS CORPORATION c 0 0 Fir.m>z LAC.AO ❑ -r1kECihU I�7I,A�-ro1Z,r ❑ FW Dm.. GG dMZ /0FiG. ❑ POLICEO-L ❑ N,GMM TFCIM r P.Er-DIR ❑ Fii.fi ❑ (JIILDiR. R. Morgan Burkett ❑ President 4211 SOUTH BROAD STREET, SAN LUIS OBISPO, CALIFORNIA 93401. (805) 546-9388 FAX (805) 546-9741 PrUING AGENDA 1 h. I , 3ffW # ® 333 MA 4 %**.%A R HOTEL TEL 805 549.0800 333 titADONNA ROAD FAX 805 5.43-5273 SAN LI'IS0B1NP1,1;.4L1FORN1A93405 FOR NATIONWIDE RESERVATIONS CALL 1-800-ENIBASSY EMBASSY SUITESw March 11, 1993 • ...wa - .. lA Y .. FIAR 1 - 19t�"i Honorable Mayor Peg Pinard to i Y CO'J;JCI L CITY OF SAN LUIS OBISPO SAN Lu:s OBISPO, CA City Hall San Luis Obispo, CA 93401 RAND DELIVERED Dear Mayor Pinard: As an Embassy Suites Hotel partner, allow me voice an urgent appeal to you and the other members of the City Council to avoid raising city bed taxes in an attempt to achieve a balanced budget. We, like all other hotel and motel owners in the City, have struggled over the past few years to maintain a quality product in an economy where across-the-board cutbacks have become a way of life. A study distributed last fall revealed that many of the hotel and motel rooms in San Luis Obispo have been vacant, while our neighbors to the north and,south have enjoyed increased occupancies. This should be reason enough to avoid raising room taxes, which will result in increased room rates and even more empty beds in the City, diluting even further the volume of bed taxes collected! Tourism is a lifeline for this community. To take action that will further deter tourists from our city is a ludicrous, and self-defeating prophecy. Please encourage your colleagues to vote against this drastic measure, and look for alternative ways to cut the budget. Increased bed tax is not the answer. Thank you for your consideration. Sincerely, �J'-'ATO: SAN LUIS OBISPO BONIFACE AFFILIATES ❑-Denotes AsEon ❑ ryl � �/cocna7 �/CDDDR. �0 CAO MT.DIP, ` V ACAO ❑ riRE CrL�r ATF ,TEY ❑ R:`D.R c[ zxra-rc. Cl POL:CCECR R Morgan Burkett ❑ 1AG.N,T Tr-V',A C 1 RECUR. � General Partner c�� !� unLo IEETING AGENDA DATE '/ - _ 3 ITEM# e e e RL .WED March 11, 1993 CITY COUNCIL SAN LU;S 03ISF0, CA Honorable Mayor Peg Pinard mY OF SAN LUIS OBISPO City Hall San.Luis Obispo, CA 93401 HAND DELIVERED Dear Mayor Pinard: On behalf of Sterling Hotels Corporation, let me voice an"urgent appeal to you and the other members of the City Council to avoid raising city bed taxes in an attempt to achieve a balanced budget. We, like all other hotel and motel owners in the City, have struggled over the past:few years to maintain a quality product in an economy where across-the-board cutbacks have become a way of life. A study distributed last tali revealed that many of the hotel and motel rooms in San Luis Obispo have been vacant, while our neighbors to the north and,south have enjoyed increased occupancies. This should be reason enough to avoid raising room taxes, which will result in.increased room rates and even more empty beds in the City, diluting even further the volume of bed taxes collectedl . Tourism is a lifeline for this community. To take action that will further deter tourists from our city is a ludicrous, and self-defeating prophecy. Please encourage your colleagues to vote against this drastic measure, and look for alters_native ways to cut the budget. Increased bed tax is not the answer-. Thank you for your consideration. Sincerely, COPusTO: ❑•Ochs Anion ❑ ni CoLmci ❑,,cCDDDDui. STERLING.HOTELS CORPORATION �I�f CAO CdFIN.DIR. . 17" A•:AO ❑ FlREaiMF ATTORTdEY ❑ mbik CLERKio;=,c. ❑ POu=-L ❑ C FE4 F►.s ❑ unL D2-L Terry.L. Westrope - ❑ Vice President-Administration 4211 SOUTH BROAD STREET, SAN LUIS OBISPO, CALIFORNIA 93401 (805) 546-9388 FAX (805) 546-9741 . MEETING AGENDA MAR 1 2 1993 DATE "q CITY CLERK SAN LUIS OBISPO,CA March 11, ,1993 Ms. Peg Pinnard P.O. Box 8100 San Luis Obispo, CA 93403-8100 RE: City staff recommendations on cutting tourism contracts and raising bed taxes. Dear I am writing you- as a concerned citizen and business owner of san Luis Obispo. I would like to state my opposition to the proposals referenced above because they negatively impact the quality of life of all San Luis Obispo residents. What has been proposed represents a "quick fix" and does not address the real problem, .balancing the budget without cutting services. To accomplish this the city needs to generate more revenues. Both of these proposals threaten to decrease revenues to the city. Tourism is one of our largest revenue sources, to intact a proposal that is detrimental to this industry in. the . face of rising. competition for tourists dollars and increased budget short falls seems short sighted and foolish. I have inclosed some information on the impact of how rasing bed tax rate decreases revenues in the hospitality industry. Please . review it, I think,what is.expressed in these articles is something that needs to be considered during your decision making process. I believe that you have the same aspirations as I do, to make San Luis Obispo as good as it can be, in fact I am counting on it . . Please call if you have questions or if there is any additional information I can provide. Very truly yours, COP113TO: I ❑•Denotes Action ❑ FYI &(C andl �DDUL 5Z CAO MI.DUL eo a ewland ACAO ❑ rlxEMW ATrM%MY ❑ FWDR CLMK/0;ic. ❑ POUCECR 1635 Hillcrest Plac max fr.TF-ina CJ ric.Dix. San Luis Obispo, CA ❑ r-RrAn.FnE ❑ UTILD;R. Business 541-5001 C �� ❑ Home 543-6654 ie Niel IN &AR Study . . . S. T�Roon Taxes aw. �•f� .. . Iu twn��It ustry 7 9mencan Hotel'�Motel Association offersproof that room tbxes drive away,customers. w(f s'I.b.Y9�l•i��s.+,p,�4atM M ^- :' .�. ._ ": room tax the hotelier's and local hotel associations have 'The Purdue study has been use- enemy,or friend?Scorns of lobbied vigorously to defeat new tax ful because it documents what we ^��' ••'� a state and local governments proposals.The effort has garnered in the industry know is the case, w�• -•W •+�=t• ':have recently approved mixed results;there's been a lack of but we've never been able to prove,' '^ wrx:+'.;.•.- room tax hikes,and dozens clear evidence that the tax is self- says Phil Peach,executive director of others are considering defeating. of the Oregon Lodging Association. proposals.Government offs- .That is,until now. r Authors Hiemstra and Ismail also . rials Bay the lion's share of the tax found other disturbing side effects is spept to promote tourism,which AH&MA Produces Evidence of the tax: pute.more heads in beds and boosts A new study done for the American ■ The est winds u guest P paying the economy. Hotel&Motel Association indicates the tau,but the indust suffers This trend,however, taxing that,on average,the number of industry the patience of many hoteliers. by renting less rooms. They say the added fees actually rooms rented declines "The guest pays the room tax ini- °' - tially.However,it is ' drive away customers because they, recognized in effect,raise the nightly room about 4.4 percent for that the final burden of the tax is • te'^e' partly shifted to the lodging indus- '^r eve 10 percent increase in try,indirectly,as ram rates, �ihe traveling public today is every P including taxes,are increased," _ secretive to cost.Even smell either room rates or taxes. write IHemstra and Ismail.'While ,•mashing to noticed, onea this analysis indicates that most of }'btw!i+n•Washington,D.C.general manager y W!d USAE last March when the This amounts to a drop in the tax burden ultimately is paid by eaty'government announced plans the guests rather than the lodging to increase its hotel occupancy's occupancy rates of about 3.1 percent. industry,neither party gains.The 4ea(it.,epri.•tax:.Me proposal was eventually The new dp evidence can be found quantity impact of the reduced ' in a report called,'Impacfs of Room industry demand as guests pay y".flu a auah'taxation may higher prices due to the tax contin- useItl9ltWJlt". Taxes on the Lodging Industry," ,� ;:eppeor to generate'new dollars'it which was written by Stephen J. the o be borne ce the industry in also 'gnificantiy reduces the the form of reduced occupancy lay. +�• .,b-. +�, Hiemstra and Joseph A.Ismail of els." -at roc�tvgpess of a destination for the Restaurant,Hotel and FngeL1ago and,tourism,thus rmov Institutional Management ■The average room tan(rough- :r '1ng�ouasm and visitor dollars and Department of Purdue University. ly 10 percent)results in 6.3 per- •ultimatelyreducing tax revenues," cent fewer rooma being(The study,which is based on a sur- g rented adds Edwin t GrilCE, of a ti ve of every day than if no tax existed. president and CEO of Meeting can be obtained� �fr from the AH&Nul of room 'fhia adverse impact _ Planners International• Iefomation Center,the cost is taxes translates into a reduction in _ V✓orried that travelers are fed up $16.00 to members and$30.00 to average occupancy rate from 69.3 with'riseng loom rates,many state nonmembers.) percent to 66.2 percent,a decline of __ ,,. • ''•LOWING16E"EMBER 1991 ,w fir•r F .. ✓ r 3.1 for the average property with relatively high incomes...In Peach,executive director of the responding to the survey,"the study additinn.the taxes are imposed on Lodging Oregon Assncintion. states, purople(whin are away from home "Now that everylxaly is in at bud- 0 Smaller properties,those and have no vote in either the deci- get crisis,the hotel tax is being with 150 rooms or less,are hit sion to tax or the use of the funds." exercised more than ever hardest by the lax.The drop in The authors tempered their find- before." occupancy rate for this group aver- ings with some hopeful remarks The total room tax in New York ages 5.4 percent compared with that the room tax can,as some gov- now stands at a whopping 21.25 7 percent for hotels that have ernments claim,promote tourism. percent,which means that a only 0. only or.more rooms. "This analysis measures only the guest pays an additional$42.50 adverse impacts of the tax on room at a$200-a-night hotel.Seeking ■ When room taxes are relief from state officials,the imposed,the occupancy rate relitaly, 1(opefit)ly, the Hotel Association of New York decline is highest(6.8 percent) , ,, n+l'll'is !tsC(Ul to (fit- City estimates that the tax could for properties that have less spur a 16 percent loss in hotel than 150 rooms and nightly lodging industry in revenues during the next three room rates between$75 and years. $100' ctimulatinj;increased Wayne County,which includes (EDITOR'S NOTE:The data is the city of Detroit,is considering based on the average daily rate con- a five percent room tax hike to tinuin for 365 days a year,with no travel soft offsetting, W at G 5 help finance a replacement for allowance for seasonality.) ;C;tsl some dcf;fCC, lhC adverse Tiger Stadium,the home of base- 0 The adverse tax impact ball's Detroit Tigers.Detroit increases significantly with irtllr:vrtsoftltetnxes,"theycaid. hotels guests now pay al2per- increasing average room rates. cent room tax.Area hoteliers say The number ofroomsnot rented at Thcauthorsconcluded that the increase,if enacted,could a 10 percent tax increases from 2.3 spell doom for their already percent for properties charging less :thotlt half of room taxes struggling businesses. • The Texas Hotel&Motel than$40ope per night i 9.3 percent :ire iised for industr related purposes. Association has formed a"legal for properties charging$100 or Y• PTP more per night.These numbers defense fund,"which petitions ' translate into declines of 2.3 per- "It was not possible,however,to local governments to reveal how cent to 4.8 percent in occupancy assess the efficiency in the use of room tax money is allocated. rates this tax in increasing occupancy of State low requires that the the industry,"they write. funds be spent on tourism pro- Why? motion.But the Texas legal Lobbying Efforts team,which is supported by con. If room tare so harmful to However,until evidence is produced tributions from state hoteliers, hotels,whhyy a are state and local gov- that the room tax helps rather than has found that the money is ern'Specentsial so anxious to pass them? hurts,the lodging industry will often used for other purposes. 'Special taxes is s are often work to defeat new tax initiatives. For example: home lodging services are often For example: The Jacksonville Chamber of viewed s n atom ss way to raise Commerce sent its vice residrnt revenues in a community,particu- The District of Columbia govern- P larly if the need is for revenues to ment this year proposed increas. to Dallas for a seminar at a cost build convention centers,to pur- ing the city's room tax from a of$900-paid by room taxes. flat$1.50 a night to 2.5 percent The city of Addison spent more chase assets for use by tourists ors to 3 percent of the room rate. than$300,000 in room tax promote teal tourism,"the authors mono on a local write. The Hotel Association of y college enter- However,they note that room Washington and area hoteliers tainment choir called, taxes are not always used for those lobbied to defeat the plan,which "Celebration USA." purposes. was eventually rejected by the The county of EI Paso spent "Room tax receipts often are col- city council. room tax funds to buy new golf lected for other purposes,such as Several Oregon cities and coun- carts for a county golf course. general support of the government, ties have passed room tax These disclosures and others increases,or are considering have prompted many Texas cities to de even for no purpose of the impcally doing so.The Oregon Lodging discontinue the practice ofspending designated of the time Of the ys. Association has proposed legisle- room taxes on programs unrelated anion of the tax;the study goys. 'Me general consensus(by govern- Lion that would place a cap on to tourism. ment officials)has been that such local room taxes. 'But some of them are still doing taxes...have little adverse impact "H'e're letting them(legisla- it and we're going after them; on the lodging industry because the tors)know how much revenue is promises Don Hansen,executive raised locally and just how little vice president of the Texas Hotel& taxes are paid largely by cosiness indirectly or people on vacation is spent on tourism,"says Phil Motel Association ■ 40 Looc!ac/Ssmi,iu a 1991 Ask 1 � yJim ALesson in already be charging him the extra dol- decrease in the number ofroomsrent lar?Hewasnot impressed.Weavreedto Because of the tax rate increase tip.. Economies disagree, and to argue our different amount of tax collected(T1 plus T2)is points ofviewinfront ofthecitycounci' eater even though the number of Following is the analysis that I presente,. oms rented is reduced.The amount of to the city council. hotel revenue (112) is less than before Figure 1 is a tradition' :ply and (R1) because of the decrease in the `' dem anddiagram.Thesuf .:veSSis number of rooms. • y sloped to show that at hig;,, : prices the The adjustment of price and quan- '` _ quantityof rooms availablewill increase; tity to a new equilibrium is a behavioral at lower prices therewill be fewer rooms fact. It happens,whether some or all of available. The demand curve DD is the parties involved are Republicans, t sloped to show that at lower prices Democrats,Communists,Presbyterians, there will be a demand for more rooms; or Socialists.The effects of this adjust- at higher prices customers will i-ent fewer ct ust- athigherpricescustomerswilh-entfewer mentare almost ascertain.Tlieeffect of rooms.Thevertical axis measures price increasing the tax rate will, for the first and the horizontal axis shows quantity. year at least,indeed result in increased David Morgan,President For this purpose we think of price as the revenue to the city.It will also decrease California Lodging Industry Association average daily rate,and quantity as the hotel revenuefromR1 tQR2.Theamount number of rooms rented during a year. of the decrease is rectangle R3. The The intersection of the supply and de- hotel owner will have less money avail- This is atrue real-life hotel story.When mind curves at the price'of P1 and the able to pay his expenses.His mortgage it happened to me,I thought"This is the quantity of Q1 represents economic payment will not decrease,nor will the kind of thing you read about in a maga- equilibrium.At the average price of P1 cost of his supplies or maintenance. zine." Here it is. the hotel will rent the quantity of Q1 One area where he might cut back is Late last year thecity manager in our rooms in a year.The product of these payroll. hie might work the front desk town began worrying about the next two values (P1 times Q1 equals total himself and save the salary of a &0 municipal budget.According tohis pro- revenue)is the amount of money spent clerk.We don't know exactly what i jections, the budget was not going to annually by hotel customers. The price hotel owner will do.We do know that lie balance. Expenditures were going to the customer pays consists of the price will have less money to put back into the exceed revenue.To balance the budget of the room plus the tax.The total rev- local economy.We know that each dot- he began looking for ways to increase enue is also two parts,tax(rectangleTI) lar he spends into the local economy revenue.One place he looked was tran- and hotel revenue(re ctangleRI). has a multiplier effect as the person who sient occupancy tax(1'OT). Figure 2 shows how the situation is receives it spends it again.In California Hisofficecalled theChamberof Com- changed when the tax is increased. The the multiplier is around five.This means coerce to schedule a meeting with the price the customer pays increases from that each dollar that the hotel owner local hotel owners. At the meeting lie P1 to 112. As a result, the number of spends intothe local economy becomes explained that there would be less rooms rented decreases from Q1 to Q2. five dollars as it is spent and re-spent money coming to the city from the state Rectangle 71 is reduced in size by the (Continued on page 25) next year.He said that he was going to recommendthatthecity council raisethe TOT from 8%to 10%because he felt he hadadutyto increase revenuewherever D S D S possible.Hetold us that he had a master's degree and that he felt therewould beno financial impact on the local hotels or P1 economy.He said that the tax on a fifty T2 dollar room would increase from four P1 P2 dollars to five dollars.He made the state- T1. T1 4 ment that he thought that most of our R1 R2 93- customers would not notice a dollar and that the eventual result would be an S D S D actual increase of 25% in TOT revenue for the city. I asked him the obvious question,that Q1 Q1 ifthe customer actuallywould not notice FIGURE FIGURE a dollar increase,then why wouldn't we California Lodging Update -JanuarylFebruary 1993 5 Improvement Districts-Seismic Safety Privacy President's Message AB 1965(Areias):This bill expands and AB 1168(Moore):This bill,whiclrfailed (Continued from p(Jge 5) restates the power of a municipality under passage Hould,havetequired.anyperson locally.Italso means that each decrease he Municipal Improvement Act of 1993 to using a computer network to collect and of a dollar means five dollars less to the nakefundsavailable tobring real property distribute defined'personal 'information and private,and public buildings into com- about an individual for commercial pur- local economy. pliance.with seismic safety standards and poses to notify the individual and, if re_ After explaining Ificecononliclheury regulations. It covers earthquake damage, quested,to provide a copy of it to the indi- to the council,I then told them what the repair work and the removal of damaged victual. specific effect would be in our town. buildings in guhenatorially designated di- The tax increase of T2 and the hotel saster areas. The,bill was signed by the Pay Phones revenue decrease of R3 would each be Governor. SB 1548 (Rosenthal): 'This measure re- abouttwent hvethousanddollars.That quires the Public Utilities Commission to y Water.Closets adopt and enforce an operating require- amount would not have a significant SB 1224(Killea):Thislegislationrequires ment for coin-activated and credit card- effect on the projected budget deficit. that on or after 1/1/94,all water closets and activiated telephones available for public On the other hand, it could mean the associated flushometer valves sold or in- use,whether owned by telephone corpora- loss of a couple of hotel jobs and a loss stalled in California shall use no more that tions or persons other than telephone cor- of over one hundred thousand dollars an average of 1.6 gallons per flush and must porations, which requires that every tele- to the local economy.Jobs and the local meed specified performance standards of phone display a not ice tfiat surchargesmay economy are politically sensitive stir the American Society of Mechanical Engi- apply to operator-assisted and calling card neers. The bill would exempt from those calls.It was signed by the Governor. jects here.Ourcitycouncil meetings are requirements blowout water closets and televised. 1 pointed out that a vote to . associated flus-6ometer valves, and situa- Advertising Plans increase the'TOT would not only not tions,in which the installation of water clos- SB 1678 (Killea): Existing law specifies solve the budget problem,but it would' ets meeting those standards would require that certain practices which,when used as be a move in the wrong direction with modifications to plumbing system compo- part of an advertising plan or program,are respect to two areas in which the coun- nents located beneath a finished wall or deceptive and constitute unfair trade prac- surface or,in a home or building which has tices. Specifically excluded from this provi- cil purports to have an interest. I asked been identified as a historical site. The bill Sion are Incentive opportunities to stay in a them if, now that we all understand was signed by the Governor. hotel or in other resort acconnnod:itGnis at what is happening, this .is what they a discount if specified conditions are inet, really wanted to do. Building Standards Effective Date including that theaccommodations offered Thevotefailed topass.Our towngot SB 1588(Kopp):This measure specifies for sale are located. 'This bill revises the what it deserved,agood decision by iat changes to the California Building Stan- exception permitting stays in accommoda- citycouncil.Maybe more people ingov- Liards Code by the State Building Standards tions that are within a 20 mile radius of the ernment need an economics lesson. Commission shall not become effective ear- property on which the accommodations Hope teed n'economi off well for lier than Che date the Code is available for offered for sale are located. It further pro- p purchase by the public. vides for a required statement that the re- You.The year is sure to bring more TOT. cipient is responsible for payment of any challenges to CLIA members and we'll Miscellaneous government imposed taxes directly related continue to provide the best resources Unclaimed Property to the offer and any personal expenses in- possible in helping you fight it. I hope AB 2457(Klehs):Under existing law,per- curred. The measure was signed by the this article provides a new perspective sons finding or saving the property of another Governor. that you can put to good use in your worth$10 or more are required to tum the individual battles with TOT. property over to the local,police or sheriff depending on the jurisdiction where the prop- Happy New Yearl ertywas found.This bill increases the require- mentstopropertyworthmorethan$100.The bill was signed by the Governor. ll - Ly-man S. Robbins y Real Estate Broker—Northern California Specialist ; Hotels, Motels, Resorts — Bed & Breakfast Inns Call Lyman Robbins now at c�nir�d r r • r � �.. C mdai (707)578-4811,Ext.241 Mcn bM m (707)578-8456 Eves. _°,q > CLIA Associate•PAII Associate 3554 Round Yarn Blvd.,Santa.Rosa,CA 95403 .,`, 'j • "-�1�ti," California Lodging Update -Januaryffebruary 1993 25. 9 C, . ° � 9 00 Uc) y 44 l w sift z c °° � `1� z _ . O 0 I'n s W z O NN ono U) InN n r CL Z N r r G ao ao aD ao n c00c. W LL. � y m W c co a O _ � W W cr W O c t' W W C E z O Z Q V M ^ ft Lo o a N oc a N o o M U)a s a "� M U) "� coo Cn c� a 3 W r_ O V C ILU. �. m 0 Wm y z =. J O Q O y W N ca M tt M LO N !h M Z v � G LL O L Q v' z.= 0 y O y L C y M G m �.� . 0 Cv. U. O w yV coC1 C O d 0 e c '° c c c E a 'a H V N H N Z 0 • cij ! .. 5o 5 g P -C CIO dic M, cz 5-4 y °❑ml��bmagi� w loo fi. I W ZI zO _ Li m L J W y _ f f LL W Q I= 3 1 W- O. O d m to It Ln co N v p # r- O (D O n ua N V N O N cc i IL co n n n n co W It cc u. p w z z O di c F:, O Im O c (n7 W O v• lA W 04 k, r: to ZWcis r a 0C.) a z p H m o n o C" .- N (a j O Ln m O o ao � ca Ln � d > > a oLn n.. O M 00 Ln M Ln O c Cop. M Z ft ta o ci eh ri of 4 ;, o CL un Ln d w v M to c C r V u m w V < ao •C N LL " •O p z 3 O O m = W _ N Q et °• Ln r- N o qa Ln co co n d n N N d Ln d w cn 0o M d N N N C7 k . o. z _ p z w rn LL auml Q z W y y { b m 3 m c 'ty'gri.• N . N Fn•Y 3k.:. ' r LL NC c0 N H V A ?a.. C . N LO V d r s A. m cc a cc 0 m o a v Lr va Ln e z (n' ..L, N -ING 3-9 AGENDA''=, - ITEM #_,1.._.__ john M. Martin 252 Westmont Avenue •San Luis Obi A 0 FYI Residence:(805)543-1338 Id Camdt ❑ CDDDUL VCAo UrFuv IX ACRO ❑ FMeO S.L.0. City Council ATfCIIi,VEY ❑ FINppt, 990 Palm Street CLERK/OR1G. ❑ POUCE CR San Luis Obispo, CA 93405 MGMrTEAm U r.BCDR ❑ CRFADFRE ❑ UnLDUL To all members,` — ❑ It .is with great displeasure that I read in the newspaper about the proposed elimination of jobs in the police and fire departments. I strongly urge you to cut these two departments as a very last resort. I am the .previous owner of Campus Bottle Shoppe here in San. Luis Obispo and have been a direct benfactor of the Police Department. I was in need. of help at the time of the riots and in a number of other instances as well. I can tell you first hand that I believe strongly that the Police Department should not lose any officers in the -proposed cuts. I also believe that if any officers must be layed off that the newest hires to the city should be the ones let go,' and that the most experienced remain on the job. Hopefully You will be able to avoid any cuts in this area. Another area that has me baffled is the project with Cal Poly students patroling or responding to party calls as a first effort instopping a possible situation. I would be all for a project of this nature if the funds were available and we were not in the budget crisis we are now in. It seems to me that at this time the money allotted for this project would be better used to help keep the Police Department at its current level. When the economy turns around and there are available funds a plan. of this type should be tried, not when we are faced with the prospect of a shrinking police force and a decrease in the public safety it provides. It is my belief that areas in which do not result in the loss of emergency personnel should be targeted first. The streamlining of departments like the planning department could save money and only delay projects, not jeopardize emergency services. As .a last thought I would like to see a very strong effort to see the mall expanded to draw some larger stores. This is needed to keep the locals here to shop,thus keeping a lot of tax dollars at home. Only then will the downtown become vitalized again. 1 cerely/�/� RECEIVED n �M"artin� MAR 1 1 .1993 CITY CLERK SAN LUIS OBISPO,CA F urtc — Ti AGENDA DATE —q3.MR SUMMARY ECOSLO has exceeded every requirement of its 1992-3 contract with the City of San Luis.,Obispo. We have enjoyed a good working relationship with the City and hope to continue providing professional environmental assistance. Our 1993-5 proposal speaks to, the same basic service level and offers some additional options that we feel would be of real value to the City. Please find enclosed the following program options: 1) MAINTAIN THE CURRENT ECOSLO/CITY OF SLO CONTRACT •Maintain current service levels to the public and city departments with no increase in staff in spite of a significant. . v increase in demand. *Presumed funding to be General Fund. 2) PROTECTION OF THE MORROS *Addresses several top City priorities .*Funding from City promotion funds 3) CITIZENS TO THE RESCUE *This was developed in response to council suggestions ,*Funding would come from the General Fund. with g projected offsets of three to one = a real value in anyones book 4) POLY POTENTIAL •This- is a specific application of #3 with projected possible benefits 5) HOME COMPOSTING EDUCATION • This proposal is intended to address .a portion of the City's AB 939, solid waste reduction obligations through a backyard composting. COPIESTO: VAR 1993 Acd „ ❑ Pn CITY COUNCIL dZama ❑ cnDDIIt SAN LUIS OBISPO,CA RAV O YMN.DUL AO ❑ �ChW , OiL�iEY FIN DIR l CLERK/PRIG. U PaXECH. ❑ MCM?.TEAM ❑ P.EC.DIR ❑ C READ ❑ U nLDUL �-FLZE Ll--` o1 14 I MAINTAIN THE CURRENT ECOSLO/CITY OF SLO CONTRACT ECOSLO has diligently and faithfully met and exceeded the requirements of its contract with the city of San Luis Obispo. The mandates of AB 939,the California. Waste Reduction Act of 1989,and its attendant"$10,000 per day fines for non- compliance,loom little more than years away. Our struggling_local economy dictates cutbacks in city programs and services.Inthe midst of this dilemma, ECOSLO's lean management and controlled expenses of the downtown center offer the city a"cost-effective opportunity.to meet its obligations in educating the public on recycling and"source reduction: Staff review of the quarterly reports submitted by ECOSLO will reveal the depth and range withwhich ECOSLO has acheived its contractual obligations: eNot only does ECOSLO answer recycling questions,but it petitioned for a grant to offer 24-hour voice mail on a wide variety of recycling and conservation issues. eNot only did ECOSLO compile a list of local vendors who carry recycled products,but it developed a consumer-friendly Recycled Product Guide. . eNot only did ECOSLO sponsor an annual event to enhance public awareness, but it has chosen"cuttingledge" topics,offered specific tools for local policy-makers,and sought to bring environmental issues to a "mainstream audience,' ECOSLO has many goals for promoting recycling and environmental issues, " including increased attention to household hazardous waste safe disposal and recycling,preparing a school environmental curriculum targeted at,K:12 education and facilitating greater interaction in land.use planning with local businesses and agriculturalists.The continued presence of the downtown environmental center is vital to achieving even a small percentage of those goals. We look forward to continuing to serve the citizens of San Luis Obispo from 967 Osos St. and with the city's support we are confident that ECOSLO will. continue to offer innovative solutions to the challenges facing our city as we enter the.next millenium. Environmental Center Budget Non-Personnel Rent $14,400. Telephone $ 2,400. Utilities $ 1,200. Postage&Supplies $ 1,296. Repairs and-Maintenance $ 500. Insurance $ 11000. Printing1$ 0,000. Non-Personnel Total $30,796. Personnel 1 Full-time equivalent coodinator $22,000. I Part-time assistant 8,000. Personnel Total $30,000. Environmental Center Total . $60,796. ANNUAL FUNDING REQUEST. Request for city funds to maintain city contract at current program level - including producing a 1994 Recycled Product Guide: $25,000. t PROTECTION OF THE MORROS For decades the protection/preservation.of the Morros (the area bounded by Los Osos Valley Road and Highway 1 and lying between San Luis Obispo and Morro Bay) have been a7toppriority for the City and the County of San Luis Obispo. To date, each jurisdiction has developed some policy and taken some action dealing with sensitive resource areas, hillside-protection against building encroachment, etc. The County developed the Preservation of rhe Morro plan over twenty years ago, but, to date, no comprehensive "preservation" has taken place outside a grant of land at the top of Bishop Peak and the purchase of the flood.plain known as Chorro Flats next to Morro Bay. In 1991 there was a proposal to build a convention center with golf course at the base of Hollister Peak that sparked significant public uproar and reminded everyone just how unprotected the area really is. The Morros are critical to the area as a: • geological feature • archeological feature • natural habitat • watershed for the estuary • significant_ ecotourism feature • viewshed • green belt:between San Luis Obispo and.Morro Bay The advantage of protecting the Morros falls primarily to the Cities of San Luis Obispo and.Morro Bay as well as the County of San Luis Obispo,but is clearly`of regional and national interest. ECOSLO proposes to coordinate, much like the Morro Bay Estuary Task Force effort, a systematic approach to achieve protection of the Morros. This is a complex process involving multiple agencies at local, state, and federal levels. To get started there needs to exist a common local effort, namely the working together of the County and adjoining cities. The product •A detailed strategy for the preservation of the Morros •Coordination and integration of interest groups *Negotiate agency labyrinth •Produce "Moods of the Morros" a promotion/coffee table document Departments supported This effort would complement th on-going open space efforts of the planning dept., expand the opportunities of the recreation dept:, and significantly bolster the city's promotional efforts. Funding sources The most obvious discretionary funding source would be the City's promotional budget with some staff support from the Planning and Recreation Depts. Annual Needs/cost Planner 1/2 time 177500 staff support 3,200 office needs 41800 publication budget (partial) 6,300 Total $31,800/year Distribution San Luis Obispo $13,200/year Morro Bay $5,400 County.of San Luis Obispo $13.20 Total _.$31,800/year CITIZENS TO THE RESCUE Each member-of the city council has recognized that the greatest asset of the city is .the people that live here. Their range of talents, their collective, wisdom, their sheer strength of numbers, and their sense of community make the citizens of the city critical players in dealing. with the financial struggle that lies ahead. To date, the truth of these observations is clear in the many that donate. their time to boards and commissions and that actively participam in the political process. The current financial crises that hangs over all of us, including our city, makes it clear, that this more than ever before, is the time to .rely 'on each other, to pull together for the common , good. The city should seize .the obvious and reach out to its' people. _. There are any number of. tasks that could be accomplished by a coordinated volunteer effort. ECOSLO has extensive experience in working with volunteers on a variety of public service issues. Theses talents could readily be applied to the City's every day needs. To accomplish this, two things need to happen. First, the city would need to articulate all, and oversee- some, of the tasks . to be performed. Second, ECOSLO would expand and implement its program to recruit volunteers from the _general populous, local business, and schools; and develop a database that will cross-reference individuals .and. groups based on interest, expertise, and availability. The resulting information would then be matched with the specific need of the city, and the arrangements made to get the jobs done. This is no small undertaking, but the rewards to the city, the . participants, and the bolstered senseof community would more than offset the effort/expense. Conservative assumptions and projections suggest there are significant potential rewards to all concerned. Assume 1) City population 42,595 2) 5% participation 29130 3) participate 1 hr/mo. 12 hr/yr 3) $4.25/hr value 2,130 participants X 12 hrs./yr X $4.25/hr (min. wage) $108,630/yr - •o•(see attached "Poly Potential") , The a Product • Any number of needed civic objectives, from building a..new park to painting curbs would be. accomplished, and at a fraction of the normal cost. Community pride would escalate because , of the direct involvement in the common effort. Department support This program has tremendous potential to nearly all city departments because of the wide diversity of talents the citizens of San Luis Obispo. Funding Sources We expect that most of the funding would have to come from the General Fund, but that there are several other options such_ as PIC, homeless shelter offsets, and CBBG grants. Needs/cost One coordinator 20,500 . staff support 59760 Office:expenses 4,800 Publicity 4,400 total $35,460/yr •• This program could be done. in-house but we believe that the. reception wouldn't be asgood and it would likely become more costly: I t POLY POTENTIAL Situation San Luis Obispo is. a company town and Cal Poly is the company. Cal Poly's mission is .to provide post. secondary education and training to students so that "they, 'can become productive, contributing members of the world community. Cal Poly achieves" this with practical, hands-on; ""learn by doing" programs. What would be more reasonable then using the entire city of SLO as: a laboratory? *Cal Poly employs a talented .staff, enrolls intelligent students, " and works at its"learn by .doing" policy OCal Poly's budget cuts have produced a real "need for "new" funding *The students are facing increasing fees and have a narrow background of work experience *The city has critical work that it can't afford to perform. Public needs should become Cal Poly projects The students can perform meaningful projects. The City can get the job done at an affordable price by paying Cal Poly 1/3 the normal price, and Cal Poly receives income it wouldn't otherwise. Some obvious projects are: •The median planters at entries to city on Santa .Rosa and Broad streets are candidates for OH unit projects *The restructuring of"Morro St: offices should be. done as an Arch/Engineering/Con E project •The recreation programs should be operated—by PE/Rec majors as a training exercise, much as the childcare program has been handled on campus for years. Public Education Involves Public Service In an effort to keep .the cost of education down and gain. practical experience, all students would take the equivalent of one three unit class/yr providing community service. Assume 1) Cal Poly has 141198 FTE students 2) each student .works 3 hrs/wk one qtr. 3j value calculated at $4.25/hr 42198 students X 3 hrs/wk X 10 wk=425,940 hrs/yr X .$4.25 ,$ -million of potential community contribution (the equivalent of 202 full time employees) at little or no cost to the city of SLO. The course would be free if the work was done, or the students could choose to miss out on the experience and simply pay for the class. If all students choose 'to pay rather then be involved .the. r e v e n u e would amount to approximately SM --million =dollars. In either case it is a tremendous, much needed public contribution and student experience opportunity. HOME COMPOSTING EDUCATION Introduction Each year 98,000 tons of municipal solid waste are generated and disposed of in the City of San Luis Obispo. About 9% of this material is organic, compostible. yard and kitchen waste, as confirmed in the 1990 Waste Stream Profile performed--by Brown, Vance and Assoc. for city. Public Resources Code Sec.40051 (AB939: California Integrated Waste Management Act of 1989) mandates that composting must be a priority in.-a comprehensive Antegrated, waste management .program. While there are_ many different composting techniques, the low inputnature of home composting. makes it a very feasible and . efficient element of an integrated solid wastesolution for San Luis Obispo. •lt requires very little capital investment •It, involves people directly in managing their :own wastes *There is ,no need to develop markets for the compost; since the producer uses it •It is legally considered source. reduction, the preferred method in the AB939 hierarchy of waste management practices. The goal .of the program is to inform and encourage San. Luis Obispo city residents in the :use of simple, adaptable techniques to recycle their own organic wastes. A. concerted effort to educate the public in the benefits and techniques of home composting can have a significant impact on .the volume of waste entering the waste stream. Successful home composting education programs such as those in Seattle, Washington and Alameda County, California, have proven the benefits of.home composting on a large scale. The Program The first year of the home composting education program will have three components: • Free Composting Workshops to be held at local nurseries • A self-guided tour and permanent demonstration site at the ECOSLO yard • A series of "garden" parties hosted with local gardening clubs Each .segment of the .program demands trained composting instructors, educational_ tools (brochures, handouts, a resource phone line) and advertising.. It :is proven that this three-pronged approach will educate the largest number of people while simultaneously making the greatest use of resources in seeing that instructors, tools and advertising are maximized to the benefit of the entire program. Composting Workshops-Nursery,:.,, Program ECOSLO will host educational "workshops at, nurseries, lumberyards and home improvement centers as an expression of public/private partnership. Through the. ECOSLO program the city is able to exercise its responsibility to educate citizens on the benefits of source reduction and composting while the business owner is able to draw attention to their business; bring in potential new business and, with some entreprenuership, sell. a new "product" ( composting kits). NURSERY PROGRAM -12 Programs- Personnel Administration $6500. Master Composters $1.200. Personnel Total $7700. . Non_-Personnel Space Rental Costs $1800. Equipment and Supplies. $ 380. Telephone $ 540: Liability Insurance , $ 600. Instructional Tools and Materials $ 400. Printed Materials and Advertising $1400. Non-Personnel Total $5, 120. NURSERY PROGRAM TOTAL $12,82O.-Per Year Garden Parties San Luis Obispo is fortunate to have a wide variety of groups interested in landscaping, xeriscaping, and community maintenance as well. as professional gardening associations. While it might be argued that targeting this group for composting information is "preaching to the converted", a random poll indicates that many . members have been "meaning to get going on composting" ._ but seem to have .the same lack of knowledge and skills that could .be. ascribed to the general populous. The difference? They appear anxious to learn. We propose to. enlist the help of some of these groups. Through the groups we will find 5 host homes in 5 San Luis. Obispo neighborhoods: •Laguna Lake *Downtown -*Johnson Ave. *Grand , Ave. *Foothill Blvd. In exchange for providing an instructional venue for a group of 20 friends or club members, the program will provide a composting bin to the host for their permanent use. We intend to develop a "compost package" of completed bins and associate tools for sale at the :garden parties, in the.event that participants do not care to construct their own. GARDEN .PARTY. PROGRAM 5-Presentations Personnel Master Composter Instruction $500 Administration $500 Personnel Total $19000. Non Personnel Tools&Materials $175($ 400 in Nursery Program) Advertising & Printed Material$ 00($1400 in Nursery Program) Non Personnel Total $ 175. GARDEN PARTY PROGRAM TOTAL $1,175.Per Year Demonstration Site at ECOSLO Yard ECOSLO intends to convert an 8' X 40' trailer, currently used for storage, into a self-guided tour featuring elements of. source reduction, recycling and composting. The composting: section. would feature wall graphics which would complement the information outlined in the composting brochure; and would tailor tours for school age children. Brochures will be available to take home. In addition to the pallet bin and wall .graphics, the self-guided tour will .feature worm-composting. (should appeal to children) and a few of the alternative bins available. The area around the trailer will be landscaped with drought- tolerant plants and the advantages of composting- in the garden made apparent. The site will be open 6 days per week from 9:00AM- to 3OOPM. Help in .design will be solicited from Cal Poly School of Landscape Architecture and the School of Resource Management. ECOSLO YARD DEMONSTRATION SITE Personnel Administration $1500. Maintainance $ 960. Personnel Total $2460. Non-Personnel Compost demonstration bins $ 300'. Landscaping and demonstration garden $ 300. Upgrade existing demonstraiton trailer $1000. Displays and graphics $1500. Non-Personnel Total $3100 ECOSLO SITE TOTAL $5560. 1st Year $1960. 2nd Year HOME COMPOSTING PROGRAM $19,555.1st Year $15,955.2nd Year Expected Public Participation: Nursery Program 20 participants per workshop X 12 wkshps 240 Garden -Party Program 20 participants per .program X 5 100 ECOSLO Yard Demonstration Site 25. per wk X 52 wks 1300 TOTAL HOME COMPOSTING .PARTICIPANTS 1640 Although major municipalities including Alameda .County project a 100% participation rate, year-end surveys :reveal a closer to 75% rate in establishing home composting: Alameda County also assumes that 30% of workshop participants wily assist a neighbor or friend in starting their composting. (disciple effect) We conservatively project the following rates in actually establishing backyard compost systems: Nursery Program 65% /166 people Garden Parties 75% / 75 people ECOSLO Site - 25% / 325 Reople SUB-TOTAL 566 people Plus Disciple Effect 170 people TOTAL 736 people *The average household is 2.5 people, therefore . these 736 people will effect those in their household multiplying their influence to 1840 people. (736 X 2.5) •From the SLO City Waste Stream Profile we know that in grass and prunings SLO residents generate 400 pounds per person per year. •In the seven, years., until the year 2000 each of those people .will generate 1.4 tons of grass and prunings. (1.4 tons X 7 years) +If we teach 1840 people to compost we will divert 2576 tons over. those seven years PROGRAM COST $19,555/2576 TONS DIVERTED= $7.59 per ton .nNQ AGENDA DATE_.ITEM# � DeffinerArchltecture 663 M11 Street, San Luis Obispo, Ca. 93405 805 5414864 FAX 80S S41 486S March 5, 1993 COPlESM: _❑_,/•Denotes Action ❑ r-YI Mayor Peg Pinard d�O1II1� ❑ DDIR City of San Luis Obispo XktAO ❑ frtEGiW 990 Palm Street . �,ATTORNEY ❑ FW DIR. San Luis Obispo, Ca 93401 ►3 cLERtc/o?uc•'❑ POL CZ eH ❑ WIGMT.fFaW ❑ r,EC Buz i ❑ CRF.ADM.Ef ❑ UTILDIFL RE ECO-SLO BUDGET REOIIESTS [ _"_ ❑- 1993-95 City Bu*d Dear Mayor Pinard: On Saturday, Match.13, your Council will be reviewing budget requests for the upcoming 1993-95 City Budget. ECOSLO has submitted four proposals for funding by the City of San Luis Obispo. Since I will be out of town-on the 13th, I am writing to you to urge your support of these valuable programs. As you know, ECOSLO provides our community with numerous programs dedicated to the health and well being of our local environment. It is imperative to the continued quality of life here on the Central Coast, that ECOSLO continue to receive the financial and governmental support,necessary to carry on its vital work. I know that the task to develop a viable budget, in these difficult financial times, is a serious challenge. A healthy City budget can only exist in a community with a healthy business. climate. A healthy environment-is good business. We must support all credible means to guarantee our environmentaland financial health.. I urge your support of all four of the outstanding ECOSLO programs proposed to be included in the 1993-95 City Budget. Sincerelid _avy C. Dettmer, AIA Architect cc: City Council Members John Dunn, City Administrator ECOSLO BAR 81993. Crry SAN pU COUNCIL L CA PS TO:. .motes Arnot, ❑ Fy! L,�'I/Ctxmct ❑ CDD DIIi tJ 99 Patricia D r. CA0 j1M"pM an Luis Obispo, Ca . 93405 PTA' CAo El FIRE CHIEF 44-2970 S' ❑ FW DIX � CLE?K/01�1G. ❑ noucECR Ref. Budgetary. Process ❑ t cmr TEAM ❑ PXCC DIR. Peg Pinard Mayor _ cRESDFUE3LTrLD" March 8, 1993 City of Sart Luis Ob ` ❑ San Luis Obispo, Ca . 93401 MEETING AGENDA / J Dear I%Tayor Pinard, = SEMS California seems to be experiencing an expanding financial. crisis , making it difficult for state , county and local governments to provide basic reeds much less desirable -rograms for their con- stituents . It seems prudent at this time for the city of San Luis Obispo to concentrate on providing a solid financial' base for basic services and to postpone or severly reduce many desirable current programs for an indefinlie-ttme.. With this in mind, as a resident and home owner in San Luis Obispo, I suggest the following ideas for your consider- ation white preparing the current budget. ° List each department or service in descending -order of importance to tree majority of the people in the city beginning with those involved with the basic needs for health and safety . ` Have each department deveLop a budget that meets the basic needs ^f the people. Some departments -a;; need to expand and others to- contract. ° Select a figure that seems to rer..resent the total revenues ex- nected ,.rithout any additions . or increases of charges , fees ,. taxes , etc . than are presently in effect. Place .a freeze on all wages ,. salaries and benefits of all personnel. ` As an example of showing their commitment to the budgetary, process , all' administrative and City Council members should consider reducing their salaries. Be prepared for the painful task of transfering, reassigning, demoting.. or terminating personnel as indicated by the proposed budget. Assemble t',ae tentative budget by subtracting each departments budget in order of descending priority from the total revenues expected. When• the monies are depleted, the budget is complete . Some departments or services tay not be funded. ° Review and revise the tentative budget to reflect the best interests of the Dublic. . . .ie minor adjustments . Yours and the City Councils thoughtful'_ consideration of these suggestions will' be appreciated. 1P5ee reL'yMp W. hnson SAN Lug:. Vu.:.rU, CA 1, RAPEMEETING AGENDA � DATE ITEM #_ CRISIS CENTER SAN. LUIS OBISPO COUNTY March 5, 1993 Mayor Peg Pinard P.O.Box 8100 SLO, Ca 93403-8100 To Mayor Peg Pinard: I am writing as a supporter of the Women's Shelter Program in San Luis Obispo County.The women's Shelter provides a unique service to women who are victims of domestic violence by providing shelter and support, education and counseling.The shelter has a vital roll in the community and the shelter house is a basic necessity to ensure the safety of women and children in San Luis Obispo. It is imperative that the city council find an acceptable solution which ensures the continued existence of a shelter for victims of domestic violence. 'Sincerely" Marilyn Hamiloton i O Ami► 13j Executive Director,RCC RU(* f c«, ❑ C�DDIR i Q cAo Ga'Pnv.rnR 77 ORNEy ❑ MDR a.nuc/aUC. ❑ PoIlaoi ❑ MG'Vn:TEAM ❑ REC DIR . �� O vriLD:R � FzECEI ED (4AR 19943 CITY COUNCIL SAN'LUIS OBISPo,CA P.O.BOX 54 SAN LUIS OBISPO CALIFORNIA 93406 805.549-5798 44-hour crisis intervention service ♦ victim witness assistance ♦ district attorney liaison service ♦ court escort child/teen abuse prevention program ♦ comprehensive sexual assault training and education ♦.counseling services Set- MEETING AGENDA DATE - ITEM# _ Ids Pec �intV'd CDPIFS T0: ❑•.Deroc�nc"m ❑ FYI l�Eano l¢ O� Tad'. FINDDI Dm ACAO ❑ FMCHIEF 1 CumK/O?,IG. ❑ POLICL7m ❑ mcmT.TFAhf ❑ P,EC DIR i� '` Sq^ O�OI S O �,C DFax O U77L DIR C_ AR NG P 1 G J\S o loc 4- Axl nn � SSLYv<<R�S Q� S�nShQ.t,••.Q�' Y'�O� . U wn urr.a kt r kt-Q, Q-t nvau, rw� t�.u9 At.a')/ oU!" �oo c AA mo s.a� S�ts►s:ons � � rQa� � � h�°h� of •kS 0^ vaj A% wy �of 4-AU Q � r � 1 I L � MEETING[ AGENDA ' DATES - �,:� - ;��,. r, - -' San Luis Obispo - ' Comparison of Cross Sales aA TOS' Gross Sales Gross Sales % Difference TOT TOT 1992/93 1991/92 1991/92 to 1992/93 1992193 1991/92 July 2,635,167 2,590,167 1.74% 237,165 155,410 August 2,989,867 3,008,300 -0.61% 269,088 180,498 September 2,363,145 2,353,300 0.42% '212,683 141,198 October 2,027,345 2,012,345 0.75% 182,461 181,111 November 1,657,745 1,816,278 -8.73% 149,197 162,465. December 1;491,700 1,529,411 -2.470/6 134,253 137,647 January 1,388,789 1,434,867 -3.21% 124,991 129,138 Total $14,553,758 $14,744,668 -1.29% $13309,838 $1,0879467 MAR CITY COUNCIL SAH LL;1S OSiSPO, CA }r S. COPIBTO- DmuAw Aetim C] FYI i Camel QCDDDIR. Rf CAO VJ FIN.DIEL RT ICAO ❑ FIRE dba IuQ AITMNEY ❑ FW DBL VamK/ORIG.'❑ POLICECR ❑ mcmT.THAM C1 P.EC.Dm CRFADFRE ❑ VTR D' t ff3 { N N CEJ W 0 U7 . O m O U1 O cn O 0 . 0 O 0. - 0 0. O O ol O O O O . O O O . O O_ O ' . O O O O O O O O O e. N oo fD N A � � COCA) Cr p . 0 1CL CDNCD CD In 3 � . N ) W cn 0 0 0 0 0 O 0. . O 0 0 O 0 0 0 0 0 0 0 0. YrtI 00 N an //4 . W 0; •ate:. �^�>.• . � a��.s,�xr"n •g.� cr Mll Q California Bureau Budgets 1993 Location TOT Rate No. of Rooms. Bureau Budget Monterey 10% 10,500 $ 693,000 Napa 10.5% 2,500 327,320 Santa Cruz Cnty .10% 803 6299733 Ventura 10/8% 1,060 . 410,000 Santa Maria 10% 10550 381,000 Santa Barbara 10% 4,500 11142,000 Visalia 8% 950 250,000 Solvang 10% 746 353,000 .Palm Springs 9-10.8%. _ 16,000 2,900,000 Pismo Beach 10% 10900 257,020 Redding 1.0% 2,450 6399620 SLO County 6-10% 80000 245;5000 City of San Luis Obispo Tourism Expenditures 1991 Total Expenditures $1749817,500 Employed 2,652 Payroll $34,848,580 Local Taxes Paid $21521,480 - - 03i11i1993 15:24 FROM. CLIGI TO 080554394981540 P.02 i TOT Continues its 'Toll . On IndustryBy Anita Kramer,Executive Vice President Californla Lodging Industry Association(CUA) Purdue University has finally given they will-it's still a bad tax!)to contributed in fiscal year 1988-89. credence to what hoteliers have been provide revenue for tourism promo- During 1989-90,:the statewide average saying for years..,occupancy taxes are tion. This new tax would be in daily room r,ue rose a mere 1:8 making profits harder to come by! addition to what you may already be percent. (Sources: California Depart- paying in local TOT. As we go to went of.Commerce and Smith Travel According to a recent study conducted press with this article,the legislation is Research) by Purdue University,every 10 not yet in writing and we have no -The Transient Occupancy Tax I a percent increase in mom rates due to further specifics on how the surcharge . Tax.on Californians.Figures com- takes results in 14.4 percent drop in would work or the amount that would piled by the California Department of room nights. That translates into an be imposed. Please know,CLIA will Commerce reveal that 60 percent of all occupancy drop of 3.1 percent. do everything in its power to defeat persons staying at least one night at a such a proposal. If ever any type of California hotel or motel are Calfoi- According to Stephen J.Memstra, statewide hotellmotel tax is enacted,it nia residents: Thus,the transient . professor of restaurant,hotel,and is only a matter of time before it occupancy tax is a tax imposed upon institutional management at Purdue, reaches an intolerable Ievel. Californians,and any new or increased "with the break-even point for occu- bed tax or guest room surcharge would pancy about 65 percent,that decrease As always,the most effective way of be a tax increase on California resi- in rooms rented can mean the differ- controlling TOT is to educate your dents. (Source:California Department once between profit and loss." local city officials and in turn,your of Commerce,Number and Character- state legislative representative to the Istics of Travelers to Califarn1a)988. °fue study,which involved 400 value of Tourism and the dangers 1989) properties nationwide;found that the inherent in the imposition of TOT at average room is taxed 9.8 percent, either the local or state Ievel. -For Every 10 Percent Increase in with about six pertxirt going to the the Cost to Rent a Guest Room, state and the remainder to the county To assist you in your local battles and Hotel and Motel Occupancy Falls and city. About 5.9 percent of the to arm you with knowledge you can 3.1 Percent. By incrcrasing the bed Iocal tax is general sales tax;the rest is use to educate your elected officials, tax,the cost of renting a guestroont .lodging specific, the following data has been compiled. becomes higher,ultimately causing a Please use it aggressively in your Iocal negative impact on the,number of Hiemsira also found,not surprisingly, efforts.to curtail TOT. If you would guest moms rented due to the price that hoteliers wouldn't mind the like a reprint of this article,just give sensitivity on the part of travelers. additional taxes if the revenue were us a call here at CLIA. (Source: Stephen J.Hiearstra,Ph p. . used W promote tourism through and Joseph A.Ismail,M.S.;Impact of advertising,financing of visitor Room Tazes on the Lodging Industry. bureaus or construction of convention FACTS ABOUT THE TAXATION Purdue University,Mardi 1991)Had centers. Only about half of the money OF THE LODGING INDUSTRY occupancy rates declined 3.1 percent is now earmarked for those purposes, from the 1991 statewide occupancy of the respondents said. *Transient Occupancy Tax Rates 62,4 percent,more than_25 million VVI Rapidly Escalating. Levied fewer room nights would have.been In this tough economic climate,I'm a cl iv 1 on lodging facilities by sold. Fewer occupied rooms trigger a afraid we will see stronger and stron- cities and counties against the cost of negative employment and economic ger efforts by Iocal city governments renting a guest Croom,California hotels ripple effect,&g:,loss of lodging and increase levels of local TOT to and motels paid in fiscal year 1989-90 related jobs;diminished bed.Tax .,apport general find activities. In (latest figures available)neatiy,gnM revenues;reduction in expendinues by =4 CLIA has learned there is pro- half billion($4813 million)in Iran- lodging guests for meals,transporta- posed legislation that would establish sientoccupanry("bed")taxes,a 4.4 tion,retail purchases.etc.; and lower a statewide"surcturge"(can it what percent increase over the$462 million sales tax i+eceipts. 93/11/1993 15: 25 FROM CLIC TO 080554394981548 P. 03 -Transient Occupancy Tax Receipts (properties with no restaurant opera- attendees staying at San Francisco- are NOT Spent to Promote Travel, tions)lost an average of 5741 per located hotels and motels, along wit'- Tourism and Convention Business, guest room. For full-service opera- the number of room nights used b) When the California Legislature tions,this Ioss was more Chari 50 - convention delegates,declined 6 granted local jurisdictions the author- percent higher than the average loss percent and 6.2 percent.respectively. ity to levy a tax on the privilege of nationally of$2,851 per guest room Putting this drop in convention occupying a guest room,the monies after fixed charges and before income business into economic perspective, raised by this 'transient occupancy taxes. For limited=service properties, convention delegates staying at San tax"were to be used for the promotion this negative balance was almost four Francisco hotels and motels spent of tax-generating travel,tourism and times the national average loss per twice as much per day than the convention activities. Contrary to the guest room of$192. At$10,239 per average per day total expenditures by intent of the 1964 enabling legislation, guesi room,fixed charges for Califor- all visitors staying at Safi Francisco a report issued by the League of nia full-service properties were more lodging facilities($304 versus $154, California Cities states that nearly than 26 percent higher than the respectively). (Source: San Francisco two-thirds(65.7 percent)of cities used national average of$8,135 per guest Convention&Visitors Bureau, The bed tax revenues for general fund room. Similarly,fixed chases of Bureau Book. 1990) purposes unrelated to profitable local $6;127 per guest room for limited- tourism promotion. Nearly 66 percent service Iodging establishments in increasingly,one of the major factors of total bed-tax revenues collected by California were 35 percent higher than for meeting planners in deciding on a cities statewide are used for general the national average of$4,529 per location for a convention is the fund purposes. (Source:League of guest room. (Fixed charges include transient occupancy tax rate and bow California Cities,Transient Occu- land and building feat,property taxes, the bed tax,revenues are appropriated. pancy Tax Report:Survey Results and insurance,interest,depreciation and. In 1991,the Washington,DC-based Summary. 1989) amortization,leased equipment and Convention liaison Council adopted a miscellaneous fixed charges.) resolution opposing discriminatory -Health of California Lodging (Source: Smith Travel Research and tourism taxes,including the trans/ Industry Listed as Critical. In 1991, Arthur Andersen&Company,The occupancy tax,?that are levied to California's hotels and motels experi- HOST Report. 1990) projects unrelated to,the enhancement enced a 2 percent decline in occu- of convention,exposition,meeting and pancy compared to 1990. Coupled •bodging Industry Sales Tax Re- tourism activities. The resolution. with lower occupancy,the statewide cefpts Down. Sales tax receipts, pointed out that such discriminatory average daily room rate for 1991 another barometer of the state of the taxes jeopardize jobs and threaten declined .3 percent. (Source: Smith health of the California lodging economic growth. Among others.the Travel Research) industry,were off 9 percent in the Convention Liaison Council's 24 second quarter of.I991..0=9 figures members include major meeting -tactduster Business,Lower Room available)compared to the second groups such as the American Society Rates and the High Cost of Doing quarter of 1990.`CM effective sales of Association Executives,Council of Business In California Contributed tax rate was 3 percent higher in 1990.) Engineering and Scientific Society to the industry's Poor Economic (Source: California State Board of Executives,Meeting Planners Interna- Performance in 1990. According to a Equalization) tional-National Coalition of Black report compiled by the nationally Meeting Planners,Religious Confer- respected lodging industry consulting •Lucrative Convention Business ence Management Association, firm of Smith Travel Research and Down in California. Convention Society of Corporate Meeting Planners published by the international account- business in California,which genet- and Society of GovernmentMeeting, ing firm of Arthur Andersen&Com- aces the highest tax revenues in terms Plarmeis. (Source: Convention pany,California-situated full-service of per capita spending.is down. For Liaison Council) lodging establishments(properties example,the city and county of San with restaurant operations)Iost an Francisco witnessed in 199Oa.' 6 average of$4,498 per guest room after percent drop in convention attendees, fixed charges and before income taxes. core to 1989. L04i reUpda d fio►n died by s IQ9210_of 1� �g this soma 1.x;,,8 u�p���rhe�a� Limited-service lodging facilities period,the number of convemdon 104bW ledrvrry Avwktfip .. 03/11/1'993 15:26 FROM CLIA '«^+i,, o '! r. TO 080554394981:,417 r.04 .A Lew' o1 In Economics ByDavid Morgan master's degree and that he felt there Quality 194 Mmin County would be no financial impact on the local hotels or economy. He said that the tax on a fifty dollar room woulddncrease from four dollars to five dollars.He made This is a true real-life hotel story.When the statement that he thought that most it happened to me,i thought"This is the of our customers would not notice a kind of thing you read about in a maga dollar and that the eventual result would zine."Here it is. be an actual increase of 25%in TOT Late last year the city manager in revenue for the city. our town began worrying about the next I asked him the obvious question, municipal budget. According to his that if the customer actually would not projections,the budget was not going to . notice a dollar increase,then why balance.Expenditures were going to wouldn't we already.be charging him the . exceed revenue.To balance the budget extra dollar?.He was not impressed.We he began looking for ways to increase agreed to disagree,and to argue our revenue.One place he looked was trap different points of view in front of the sient occupancy tax(TOT). city council. Following is the analysis His office called the Chamber of that I presented to the city council. ..Commerce to schedule a meeting with Figure I is a traditional supply and the local hotel-owners.At the meeting he demand-diagram,The supply curve SS is explained that there would be less sloped to show that'at higher prices the money,coming to the city from the state quantity of rooms available will increase; nextyear.He said that he was going to at lower prices there will be fewer iooins recommend that the city council raise available.The demand curve DD is the TOT from 8% to 10%because he felt sloped to show that at lower prices there' he had a duty to increase revenue wher- will'be a demand for more rooms;at ever possible.He told us that he had a higher prices customers will tent fewer ' D S D S F2 F1 T2 F1 Ti RI D R2 S S D L. FIGURE Qi Q2--Qi FIGURE 2 93/11/1993 15:27 FROM CLIP TO 980554394991540 P. 05 rooms. Th. .ertical axis measures price own ill have less money available to and the horizontal axis shows quantity. pay his expenses.His mortgage payment For this purpose we think of price as the will not decrease,nor will the cost of his average daily rate,and quantity as the supplies or maintenance.One area number of rooms rented during a year. where he might cut back is payroll.He The intersection of the supply and might work the front desk himself and demand curves at the price of PI and the -save the salary of a desk clerk.We don't quantity of Q1 represents economic know exactly what the hotel owner will equilibrium.At the average price of P1 do. We do know that he will have less the hotel will rent the quantity of Ql money to put back into the local rooms in a year:The product of these economy.We know that each dollar he two values (Pl times Q1 equals total spends into the local economy has a revenue) is the amount of money spent multiplier effect as the person who annually by.hotel customers. .The price receives it spends it again. In California the customer pays consists of the price the multiplier is around five.This means of the room.pIus the tax The total that each dollar that the hotel owner revenue is also two parts,tax(rectangle spends into the local economy becomes Tl) and hotel revenue (rectangle RI). five dollars as it is spent and re-spent Figure 2 shows how the situation Is locally.It also means that each decrease changed when the tax is increased. The of a dollar means five dollars less to the price the customer pays increases from local economy. Pi to P2. As a result,the number of After explaining the economic rooms rented de- theory to the council,I then told them creases from QI to Q2. what the specific effect would be in our Rectangle TI Is re- town. The tax increase of T2 and the ..he will hatie duced In size by the hotel revenue decrease o[R3 would each decrease In the number be about twenty five thousand dollars. leSS'M011ey of rooms rented. That amount would iot have a.signift- . to of back Because of the tax rate cant effect on the projected budget p increase the amount of deficit. On the other hand, it could mean into the local tax couected(Ti plus the loss of a couple of hotel jobs and a 12)is greater even loss of over one hundred thousand economy..." though the number of dollars to the local economy. Jobs and rooms rented is the local economy are politically sensi- reduced.The amount tive subjects here.Our city council of hotel revenue(R2) meetings are televised.i pointed out that is less than before a vote to increase the TOT would.not (RI)because of the decrease In the only not solve the budget problem,but it number of rooms. would be a move In the wrong direction The adjustment of price and quan- with respect to two areas in which the City to a new equilibrium Is a behavioral council purports to have an interest. I fad: It happens,whether some or all of asked them if,now that we all under- the parties involved are Republicans, stand what is happening,this Is what Democrats,Communists,Presbyterians, they really wanted to do. or Socialists.The effects of this adjust- -The vote failed to pass.Our town ment are almost ascertain. The effect of got what it deserved,a good decision by increasing the tax rate will, for the first the city council.Maybe more people to year at least,Indeed result in increased `government need an economics lesson. revenue to the city.It will also decrease Ardcte rep inted front dw lance'1993 Lu" hotel revenue from RI to R2.The amount aging Updata,plrUL*d by the CaWorfila of the decrease is rectangle R3.The hotel Lodg&g1ndz07Au0ciad0#1 July 30, 1990 ADWEEK Page 23 iReSnpond to Uncertain U.S. EconomyAgencs e New Strategies Recognize Consumers' Desire to Maintain a Quality Lifestyle Even as They Tighten the Purse Strings By Jon Berry advertisers because the economy is giving make your dollar go a little further." off somewhat mixed signals. The Confer- Langer sees new opportunities for prod- NEW YORK—It is March 1991.America is in a ence Board's Consumer Confidence Index ucts that can offer consumers "trade-offs," deep recession. On the television, on Main has been in a skid since March. Sixteen positioning that lets buyers get what they Street, Middle America,the owner of Geppe- states, according to employment growth want, but at a cheaper price—like telling to's Supermarket appears.Before the 30-sec- measures, have slid into recession. Automo- travelers to take a train instead of.flying. and commercial is over, he delivers the usual tive sales have been indecline. "There is a The strategy plays to consumers' desire to price special—fryers at 79 cents a pound.But bit of doom and gloom," says Chuck Weiss, keep up their lifestyle,if on a tighter budget. he also delivers an unusual message. an analyst with the Westport, Conn.-based "I don't think people want to give up their "We still believe in America," he says. market research firm,The Weston Group. goodies,"Langer says. "Everything is going to be OK" Not everyone is certain of that assessment While positionings are supposed to stand Are such commercials a far-fetched possi- yet. Consumer credit—after a general apart from economic winds,the specific ap- bility?Not at all, thinks �MLL slide—bounced back in peals of ads can be changed. Traditionally, Alan Causey,director of May, rising at its high- in economic downturns, value becomes the social analysis and fore- MORE LIKE'10 HAPPEN BY YEAR 2000 est rate since last Octo- buzzword, as marketers face the challenge casts at Ammirati & ber. A&P's Causey of convincing consumers that it will be worth perttntropendinQ9ikelymhappen' notes that the savings parting with the dollars the are holding Puris/N.Y. If Americas g P g Y g current signs of eco- •U.S.will lose economic independence rate—another bench- ever dearer. nomic malaise trigger a because of foreign investments mark—has not been as Researchers don't see any difference in full-blown' recession, 46°4 great as he would ex- the current environment. "Folks are going says Causey, consumers There will be another depression like pect if consumers were to be looking more at value," says Jack can count on advertisers p settling into a bunker Trout,a partner in Trout&Ries,Greenwich, to be there with"instant the one during the'3os c mentality to wait out a Conn."They're not necessarily going to pay reassurance." ®35�° downturn. top dollar. Advertisers need to skew their "Advertising has got- "It seems to me the message more to a value story." very responsive," powerful country n ve onsive " •U.S.willo longer be the most consumer is in a position "You have to stress worth," adds A&P's P .sys Causey, citing, as ®36% of sort of holding his Causey. "Consumers have to know that precedent, the calming breath and waiting," they'll be getting N4at they,pay for.If some- ads that came out of Causey says. "There's thing is expensive,Rb because it's worth it." Wall Street within days of the stock market not a horrible sense of pessimism, but nei- That theme dovetails into the overall crash of 1987. ther is there a great deal of optimism." trend emerging as America downshifts from Neither Causey nor his research peers in- In focus groups, some researchers say what Trout calls "the excessive '80s" to a side Madison Avenue's other major ad agen- they have seen growing decade of paying down cies are advising clients to start drawing up concern among con- CONSUMER CONFIDENCE DOWN America's staggering storyboards for recession commercials yet. sumers. Since the be- consumer debt, corpo- But,as bad news continues to pile up in sta- ginning of the year, March Apra May Iaae rate debt and federal tistics from the government and the private there have been "real 0 112 budget debt. sector, advertising's social scientists have increases" in the num- d 110 For several years, begun studying the economic currents much ber of subjects in focus a JWT's retai researcYii more closely. groups talking about s loa has shown a sharp In advertising strategy sessions, many the economy being bad, a swing in how consum- agencies are trying harder to be sensitive to and tightening their s 106 ers define themselves. whether their ads are out of step with con- purse strings, saysJu- ^ loa Barelv a quarter o sumers'anxieties about the economy. dith Langer, president m those aolled identified "We are doing much more cross-check- of the New York-based L 102 themselves as "value" ing,"says Peter Kim,senior vp/executive di- research firm Judith s o ers our ears rector of consumer behavior at J. Walter Langer Associates. s loo aeo. ore ernne rnsteaa- Thompson USA. "There is a much great- ,`E PoKR�.,� to think of themselves How responsive advertising should be to er sense of consumers as "Quality" oriented. winds of change in the economy is a perenni- being under financial pressure." Today, however, 40% say they are"value" al question, according to researchers. Ideal- Advertising agencies have a distinct advan- s o ers. ly, brands should be above the vagaries of tage in planning strategies for a recession this But it's not quite as easy as saying con- the temporal world. Part of the mystique of time around. They now have more data on sumers are just in search of the best price. a brand,should be its timelessness. It's hard consumers'shopping behavior and psychologi- After living a quality life,consumers are not to imagine, for example, the Marlboro Man cal mindset at their fingertips than ever,be- willing to trade that away—many want 'fighting up a cigarette in a soup line. fore,and agencies can fine-tune that data bet- products that let them have it both ways, "You don't ever want to fundamentally ter than ever before, with the cross-checking with an image of quality and a good price. change brand positions," says JWT's Kim. abilities of computer databases. Affordable luxuries—the kind of posi- "Positionings should be long term and en- The result—if the downturn continues— tioning that made Grey Poupon mustard a during. They should live for the lifetime of likely will be a quick shift to advertising that "fortune—could be the big winners, A&P's the brand." emphasizes different themes.Langer,for one, Causey says. 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M Ln :03 T ® •� �a Q t N o a c N t m m m Zca 'd' 2 > a) st ■ s- Ln ui _ v M a O mo a m COc � O 0 co co > N moi. �• Vf CIMW 0 Q1 i •C M - 0 ro m (' _fes-1I W u R os. , r� z `c Q o°c vi O RL��il ® ® C)I I L _ . C 4 u � C7 u L _ L' O U .� UJ^. O U u y; C S u L ^ N - � � O :. O O `) O •O C 1. - � — = L ' O = � t.0 4 C F1j o ■ :1 ;S :A 'n r O '� i c.Or .•yJ C Z CS a memo o c ° opo F � ❑ J _ o 0 O u •r. u � U rn L ;n � � L tj Opp 7 V _ O _ _ _ v •u v CA ._ J _ ho _ 1' _ o= - + v u ' ci ' " a — h ^e' toy to N w C N C ^ " = :J C C L U J M. ^I te tc ^cc = J � F O bo _ _ o ♦mo Z - oo > A C J > > - .u, v U ♦ cv o� � a = � � � N ? ? m u Other Cities Imitate Seattle's Mktg, Program 570/ 0 Participants' Frequency f Visit Seattle attractingin r r firs visitors to Seattle. o. ® First Time ® 1-3 Visits Over 3 Visits SOURCE: i tonlinued from page 3 Four Seasons to Sheratons, Best WHAT PARTICIPANTS Westerns and various local indepen- LIKED ABOUT SEATTLE: dents. "We were trying to decide • Friendly people what to do to pump more business and service staff into the first three months of the a Great shopping year, added !Morris. Similar efforts are underway in many destination ether markets. With mam. hotels stntg- • Wonderful hospitality in filing to stem an erosion in occupai ic. hotels and restaurants rates, many industry officials are urging • Pike Place Market operators to suspend competition and . Great clean city work together for their mutual gain. According to the post-market survey, • Easy and convenient . the most successful aspect of Seattle's to get around effort has the toll-free resenation num- ber, a one-time deal that allowed con- '.WHAT PARTICIPANTS`=' pu�%w�y sumers to make hotel reservations w.DiDNLIKEABOU7•SEATTT 'E:iR ,,T: : k w ; through the local Ticketmaster outlets �, • i30�: r - ,�,xa ;r More than 70% of respondents su•on— ^° o i00rn taX �r p :�w�,,,Pce..Ya:.:.-4:s•- e'er'- �=4.r�'-J. • Not enou haime t-doral ;Zi ly agreed that the toll-free component ��„��t a..,r- s. 9� - �. has extremely helpful and informative. T,- Parking ratee too higl:i' The scent of success has been picked ;a4•Traffic r up b} nearby cities such as Portland, i•'.,• j' r " . 4 which has asked the KCS\B about the :?-;':H'6h1218SS atld =• tran'sient populatig- � tinning program. Morris said the pro �¢- -r.„ _ 11 grain will be repeated this hinter. "M e I •No complaints plan to refine what we did last year fur ;; ;i'., n0 dislikes nextyear's program,"he said. sagilnbu! fo aagwnu 8 8 8 w 8 0 [-F4 D ri Ift irl Z < F Y zs W ^ 4 N t��rZ!17 �►: m in {b N r 0 San Luis Obispo County Visitors & Conference Bureau SAN LUIS OBISPO COUNTY VISITORS . & CONFERENCE BUREAU SAN' LUIS OBISPO 1992/93 ACTIVITY REPORT CARD YTD* 1991/92 1992/93 CONFERENCE SERVICES Number of. Conferences 28 12 Number of Delegates 3,832 2,282 Potential Economic Impact* $1,263,410 $656,835 FILMING INQUIRIES . Number of Inquiries 1- 5 Actuals: Num er of Commercials 0 11 ' Number of Feature Productions 0 0 Number of Television Productions 1 r0 Number of Video Productions 0 3 Number of Catalog Productions 0 1 Reported Economic Impact N/A N/A PUBLICITY NaiFer of Press .Inquiries 9 Number of. Column Inches 238 214 Paid Advertising Equivalent $ 59,500 $53,500 FAMILIARIZATION TOURS Number of media tours/visits . 4 Number of travel agent tours 3 2 . *As of 1/26/93 * Daily expenditure of $157/person/day is 'IACVB industry. standard 1041 Chorro Street, Suite E.San Luis Obispo, California 93401 (805) 541=8000 FAX (805) 543-1255 MF`�`1NG AGENDA / JAMES F. ARNDT DALEITEM # 1080 BLUEBELL WAY SAN LUIS OBISPO, CA 93401 co>nrsio: - ❑ Dalotes Action FY1 (805) 546-9709com, o CMDIR MARCH 13, 1993 9 cAo Q(RN,DIK 01 aeroRR cH VAT :.4'y .4'YRv DIR fi (CLMK/a,!c. 9r0uCECFL ❑ G REC DIR The Honorable Peg Pinard, Mayor MGMT.TEA N4 p,.c�DfiLE D U'IILDIR. Bill Roalman, Vice-Mayor -6to'cIfy crer sorr.:rC-0 Finance Director, Statler Penny Rappa, Councilmember Police Chief, Neumann Fire Chief, Gardiner Dave Romero, Councilmember Public Works Dctr.,McClusky Water Divn. Mgr., Henderson Arlan Settle, Councilmember Wastewater Divn. Mgr., Moss /!•35 4n� RE, SAN -LUIS 081SPO MUNICIPAL BUDGET FAAR l 1993 CITY COUNCIL CITY COUNCIL MUTING MARCH 1.3, 1993 . SAN Luis 08iSP0,CA Northcote Parkinson died Wednesday. He left us with many "Parkinson Laws" the most famous of which was WORK EXPANDS_SO AS TO-FI 'TH QLLFOR ITS-COMPLETION. This was an off shoot of his most famous adage HOW_SEVEN_ EMPLOYEES CAN BE MADE TO DO THE WORK OF ONF• It is my opinion that this adage is applicable to the administration of this SLO city. I have lived in this community for only three years but have been able to observe first hand several questionable time delay,/obstructions'from contact with "the administration". 1). When we moved into our condominium, we sought to add an enclosed patio cover. With complete specs., bids and check in hand, we applied for a building permit. it took us five months to secure a permit after many contacts by the contractor, my attorney and finally by myself reading the ordinance and interpreting it for the City. It was finally' conceded that my interpretation was correct and a permit was issued with no changes.to the application or,plans. it took less time to construct the cover than it took to get a permit. And to top it off,the "inspector" had to count the three trees in my front yard or the job would not have been approved! I talked to at least'seven City administrative employees before getting this permit. 2). Last year when.I discovered that I, with a one inch water meter, was being charged considerably more for water than those with smaller meters. I attempted to discover why by as at least seven City administrative employees. I never did find out. After six months, and.pages and pages of study, the City Council adopted a new water rate structure which eliminated the meter charge. However, after all the study, the.Council, at the last minute, changed their own recommendation from a "three tier".structure to a "two tier" structure. That was fine with me, but the study with reams of paper that went into it could have been much more economically accomplished. 3). French Park is still unfinished. We recognize that the drought brought on a delay. That aside, it now appears that there is a short fall in the $750,000 put aside. for the project. It seems the developer put up his $250,000 and the City put up its $250,000 but the City did not collect $750 from each of the early homeowners as was agreed to. We had to contribute our $750 in our home. purchase price but why didn't "the administration" see to the collection from all home buyers? Our Homeowners Association has dealt with at least seven City administrative persons and.still does not have an answer. 4). 1 am at a loss to understand how "the administration" was able to justify creating the document "GOAL SETTING APPROACH" composed of 175 pages of repetition and Qresented in this very room on February 6, 1993. And now L;have an additional 34 pages of{;pudget workshop material prepared for interested citizens and i can't imagine how many more pages are contained in "THE BIG NOTEBOOK" for each of the officials. I am sure that it took a lot more than seven full time persons. 5). Under "1993-1995 GOAL SETTING: Guiding PrtncJWje4 on page 8, 1 am particularly Impressed with the second principle: Balance budget while maintaining most critical basic services and minimizing overhead and other administrative . costs (emphasize change in how we do things, not in what we do). This statement is the. mostimportant precept of this entire presentation. HOWEVER, THE PARENTHETIC EXPRESSION IS BACKWARDS. It shouId. read: (emphasize change in what we do [which is zero-base budgeting] and not in how we do things). 'i onclusions and recommendations: The Proposed Budget reflecting "Current Re"sources" found on page 2 of,section A roughly gives the following budgets Public Works $ 4.9 million with 64 employees Police $ 5.7 million with 84 employees . Fire $ 4.1 million with 54 employees Administration $ 5.1 million with 60 employees Recreation $ 1.3,million with 1.3 employees Total General Fund $21.1 million with 275 employees. Water & Sewer $ 5.9 million with 26 employees So let us look at how the above activities affect the residents, taxpayers, and users: 1 ). Public Works affect everyone who is out of his home every day. Transportation leading to and from SLO and within SLO is the most used and visible activity the City ^rovides. Public Works also stands ready in case of emergencies such as earthquakes, Ioods and storms to keep the city moving. 1 r y: 2). Police are the front line when it comes to riots, gangs, drugs, automobile accidents and other emergencies. All of these are on the increase in the SLO, area and must be anticipated.. 3). Firefighters will' have to stand at the ready this summer with the increased potential of more fires resulting from more dry vegetation resulting from an abundance of water this rainy season.. 4). The City is investing $35 million in hew-sewer facilities 'and is demanding that the water supply be increased and stabilized. These two activities must be maintained or the City is out of business. RFCOMMFNDAT I ON: These four areas of activity are the heart of municipal responsibility and should not be reduced in scope. 1, as a taxpayer can adapt to other reductions, but I an concerned for the effectiveness of these four. 5). Administration? When I.look at the structure of the budget and see administrators, assistant administrators, analysts, and planners in proliferation, I as a taxpayer am not a happy person. RECOMMENDATION: There can be some great reductions in administration and overheadl ank you, JAMES F. ARNDT s, ME" IG AGENDA DATE 3-13- ITEM #� March 10, 1993 - ____...,,__ PETITION_ AGAINST INCREASED TRANSIENT OCCUPANCY TAX AND .DECREASED PROMOTION 'BUDGET FOR THE CITY. OF SAN LUIS OBISPO We,. the undersigned members of the Monterey Street Committee of San Luis Obispo, . California, are opposed to the proposed increase in the Transient Occupancy Tax and the proposed decrease in the promotions budget for the City of San Luis Obispo. We represent lodging establishments with 50% of the total rooms available in the City of San Luis Obispo and businesses involved in tourism, the -number .one industry in San Luis Obispo. We believe that if the City is interested in increasing revenue, it should lower the Transient Occupancy Tax rather than raise it. We refer to the Amer.ican .Hotel and Motel Association Study done by Purdue University as sited in .LODGING (September, 1991, pp 38, 40) : 1 ) "On average, the number of rooms rented declines about 4. 4 percent for every 10 percent increase in either room rates or taxes. 2) "The guest winds up paying the tax, but. the industry suffers by renting less rooms. " 3) "Smaller .properties, those with 150 rooms or less, : are hit hardest by the taxa" 4) "The adverse tax impact increases significantly with increasing. . average room rates. " We also believe that increased .promotion of San Luis Obispo is the best way to stimulate an increase in tourism .in our area, therefore increasing Transient Oc6upancy Tax Revenue for the City as well as Sales Taxes from pur.chaSes made by these potential visitors. COPIESTO: i ❑•Dedes Ataon Cl FYI ' srCamel ❑ CDDDIR. V CAO FIN.DIR Ga'ACRO, ❑ Fm CHISF V ATTOfLVEY ❑ MDR Z CLERK/M . ❑ POLICE CK ❑ MCMT.T A x9 CJ REC DIR: ❑ CREAD FaE ❑ urmDIP: , [AAR 1 ;,C COUNCIL S GEiSPO. CA o.�j/t/YsL^ MEETING AGENDA DATE 2.L3'_9_3 ITEM # I 'm. really disappointed that the S .L.O. Police Officers ' Association feels that it needs to resort to scare tactics in order to avoid budget cuts to the S .L.O . Police Department . I`m . referring to the half-page ad in the Telegram-Tribune on March 6 with the heading, "What do you expect when you dial 911" . We have a good police department in S .L .O . and we enjoy a' ,very low crime rate , but we need to understand that law enforcement is only one part of the struggle against crime ; indeed, only the last resort . Clean air, open space , parks , . clean streets , and well-funded social services all make a huge contribution as well . A strong sense of community and a sense of . well. being are our best defense against crime . People who live in a healthy, happy environment are less likely to commit-crimes•. Unfortunately, our society has been all too quick to fund the stick over the carrot . Simplistic solutions appeal to simple minds I suppose . It ' s just so much easier to slap on the cuffs and haul the "criminals" off to jail than to fight crime at its roots of poverty, hopelessness and apathy. The S .L .O. City Council is faced with serious budget ,cuts . Every City department is going to take a .hit . I don ' t -believe that any one department is so special that it can ' t bear its share . I hope the City Council and the citizens of S .L.O. won ' t cave in to the scare tactics of the S .L .O . Police Officers ' COPT STO: Association. ❑,�/'IeotesAdkm 0 Fil piI cm a CDDDIR ViiAR 12; 1993 9'CAO FDA.DtR Pat Veesart ��/�� ❑ ��W CITY COUNCIL jrQRAiEY ❑ FWDIR 1570 Hansen Lane. SAN LU:' Cs;SP0, CA [1r7tK/C?36. ❑ AOUCECH San Luis Obispo, CA 93401 ❑ MpyZ.Tsum 0 RM-DU 546-0518 10 CREADFLE UTILDn r:nit J m . l.�1.i.i that IasA n tougherwhcn Iherecovery rti finally rolled around. "Just look at what they've done to IBMand Sears,"says Ce- Z .HEN DOWNSIZING BECOMES (vote. nies. Th cut the heart out n these companies. 'I'hcy are blaming an over- ��SIZ staffed work force for bringing down prof- its.But that's not the real problem.These companies lost out competitively becnuse they didn't change their products." a I One of the most obvious effects of M downsizing is that the employees who sur- Z C7: I vive are forced to work longer and harder. ' v,� •.,: . - R Ate:. In February the manufacturing workweek i F o stretched to 41.5 hours,the longest in 27 y years. The resulting increase in stress ` o leads to discontent,lowers creativity and r % ; undermines corporate loyalty.A study by • r k_ : the American Management Association ,r 1 last year showed that of more than 500 firms surveyed that had cut jobs since Y, 1987, more than 75% reported that em- - ployce morale had collapsed.Indeed,two- _ thirds of the companies showed no in- crease in efficiency at all and less than half saw any improvement in profits. 1` Not only was there often no payoff on the bottom line,but corporate chiefs who expected at least some applause from Wall 1 Street for reducing labor costs also got a nasty shock. "Senior executives may think that a press release announcing lay- offs sends a signal like,'Look,I'm cutting costs, therefore reward me,"' says Carol Coles, president of Mitchell&Co.,a man- The pink slips are still flying. But with the fat long gone, man- agement "Butnsulting investors arin e of If .Iness is now cutting dangerously into musc0e. savvier than that. They know that firms that had major layoffs often have more sig- By BERNARD BAUMOHL faster pace this year than in 1992.Despite ni0cant problems.StreamlinTn�F a compa- signs of a brisker economy, at least 87 ny does not push stock prices higher." IGI1TSIz1IVG. RESTRUCTURING. large firms announced major job cuts in Coles studied 14 firms that announced RDownsizing. The terms are cold the first two months of 1993 alone. major staff cuts during the 1980s and found and unemotional. Yet the euphe- What is so troubling is that while compa- that the rise in theirstock prices lagged the misms of the early 1990s all mean hies do trim a bloated work force from time overall market by 7096 in the past three the same thing.layoffs.Over the past five to time,many of the recent layoffs may not years.For example,Bethlehem Steel began years,corporate America has been driven have been necessary. According to a new laying off workers in 1986.Yet its stock has by a single-minded mission to gut itself of study by Wayne Casein,a business professor fallen 50%,in contrast to rise of48%bythe "excess workers." It %mas supposed to be at the University of Colorado, I S&P 500. Monsanto started the fastest and easiest nmy to cut business companies have too often as- gCrrhere cutting its work force in 1985, costs,he more competitive and raise prof- sumed that if the competition but its stock rose a slim 30%. its—oral least that's what many top execu- was cutting costs by firing tremendous I Clearly these were troubled tives Ihought• workers,then they i:nd to fol- companies that would proba- But there is mounting evidence that low suit. Compaq Computer, bly have suffered sluggish this slash-and-burn labor policy is backfir- for example, announced last tooet / slack prices in any event,but ing. Studies now show that a number of October that it v.-is laying off n the study indicates that cut- companies that trimmed Iheir work forces 1,000 workers.Yet two wev.ks workers.11 ting labor costs did not make not only failed to see a rebound in earnings later, the company admitted Gmi Wall Street forgive their more ul NUI but found their ability to compete eroded that profits would double in deep-seated problems. even further."What's happened shouldn't 1992.Firms like General Elec- "There is a reverential he called downsizing. It's dumbsizing," tricandCampbellSoupcontin- belief that duringhard times, says Gerald Celente, director of the uedtoslashpersnnneleven though theybolh you can turn a company around,resusci- Trends Research institute in Rhinebeck, just had highly profitable years. '"I'here is tate its profitability and raise shareholder New York. "All thm. firings are going to tremendous peer pressu re to get rid of work- value by laying off workers,"says Alexan- end tip hurting our international competi- ers,"says A.GaryShilling,aneconomic con- der Iliam, author of Closing the Quality tiveness,not helping it." sultant."Everybody's doing it because they Gan. "But that's a huge myth." For both Whatever it is called, its effect on the think they have Io." individual companies and the economy as •icnn economy has leen painful and But the deeper problem facing some a whole,a true recovery may require dis- pi,nonod. More than 6 million permanent companies was an inability to respond pelting that myth and focusing once again pink slips have liven handed out since adroitly In changing markets, and deci- on real ways to increase performance and 1987,and layoffs are occurring at an even maling(heir work forces may have made crealivily. ■ TIME.MARCH IS 1993 55 MEETING AGEN' m= '13 DATE 3 _q �. -=ITEM if © .CI'iF570: E t ❑'Dcaotes Acdon ❑ FYI ! Counc U ❑ CDD DIR San L is it fi` r' Assod on V CAO Et FI:.DIR. 748. Pismo Street, San Luis Obispo, California 934olCHIE17- ®'A,—rmvEy ❑ Fvv Da CUE-RK/ORIG. ❑•POLICECii ❑ MGMT.Tc VA CJ PEC.DIR C FEED F,Lz Ear UTIL D R. Dear Council Member The proposed staffing reductions will place an excessive impact upon the Fire Department: Of all the departments in the City, only the Fire Department is to be cut deeper than its pre-1980 level. Special attention should be given before following the GAO's proposal. The performance of the department since 1980 has been noteworthy. The department's mission has expanded, and its productivity has kept pace with a continuously increasing workload. We the members of the San Luis Obispo Firefighter's Association implore you to consider the following documentation and suggestions. BACKGROUND Prevention is the optimum way to deal with all types of emergencies. Since 1980, the scope of the —City's fire prevention program has doubled in size and grown considerably in complexity. While civilian fire prevention staff are busily involved, it is the sworn "safety" personnel that are the backbone of the city's fire prevention program. Safety personnel routinely inspect over 3000 businesses to advance fire safety and prevention awareness. Usually, at least two visits are needed to each business by fire engine companies before compliance with fire codes is complete. Public Education is the key to reaching children for the purpose of fire prevention and accident avoidance. A public educatiorf specialist was added to the department in 1987. Since then the Department's:Public Education Program has exploded. With literally all department personnel involved, over 17,000 contacts were made withchildren and adults in 1992 alone. . Prevention through inspections and education can lower the incidence of emergencies. Fire sprinkler systems have helped contain or extinguish many structure fires in the city. However, most buildings remain unsprinklered. Emergencies will continue to occur and sufficient resources must be available to respond. In 1992, the number of incidents was 2400. This represents a 60% increase since 1980. The emergencies vary in size and nature with some so severe that the on-duty personnel and.resources are not adequate. . These situations can then deteriorate further while waiting for the arrival of off-duty .personnel and resources from other fire departments. While smaller in size, medical emergencies are most significant both in frequency and the value of lives saved. Of the 2400 incidents in 1992 approximately:.1400 were medical responses. This represents a 75% increase since 1980. Of the 1400 medical responses, 438 required advanced life support (ALS) from fire paramedics. Among the 438 ALS calls, 240 were calls with patients in critical condition..Many of these patients-would have died without the intervention of paramedics. Our city can take pride in the standard of care that has been established by past city councils. Those Councils deserve some of the credit for the priceless gift received by-four families in the month of December 1992 the life of their loved one. Each of these families had a member that was legally dead when fire paramedics arrived. All four of these patients are alive today. In fact, some of these,people have attended council .meetings for the purpose of expressing their appreciation to Council. Regrettably, there was not an opportunity for them to speak. GROWTH COMPARISON WITH OTHER DEPARTMENTS REGULAR POSITIONS STAFFING LEVELS The chart (fig. 1 ) shows the growth of the City's departments since 1979. The Department 1979 1993 Growth Proposed fire department had the lowest Level Level % Level percentage of growth - however the CAO's proposal seems to ignore this. Administration 3 6 100% 4.5 This is like imposing water rationing City Attorney 1.8 3 166% 3 and cutting everyone back the same Personnel 2 6 200% 5 percentage amount when some people Finance 10 17 70% 14 had a high baseline due to excessive Community Devel. 17.3 22.3 29% 19.8 usage and others had a low base line Recreation . 4 13 225% 11 from conserving all along. The CAO's Public Works 65 74.5 15% 68 proposal for elimination of positions Utilities 28 50 79% 50 appears particularly inequitable when Police 70 83 19% 77 comparing proposed levels with 1979 Fire 49 54.5 11% 48.5 levels for all departments: (fig. 2 ) ( Fig. 1 ) 80 Percentages show amount 1001ro 60 ____.CAUs proposed staffing 5% level exceeds 1979 level. 40 -------....._.- - -- 79°i° ( Fig. 2 ) 14% 20 _ _.^ 40% 175% 50% 67% 150% 0 Admin.Atmy Pers. Fin. C. tev.Recr.P.Wrks Util. Police Fire ■ 1979 [:1 Proposed page 2 The CAO has commented during recent meetings that to take departments back to the pre-1980 period would be impractical. .We agree. The demands and level of service has changed throughout our city. Our department is no exception. Our increase in services provided, i.e. Paramedic program, increased callload, increased prevention inspections has been accomplished with the same staffing level throughout the 12 years. We faced the challenges over the years with an attitude of "We Can Do It" rather than saying "We Need More". One example is the use of the Cal Poly Work Study Student Program with minimal cost to the city. Another would be utilization of the skills of firefighters other than firefighting(i.e. electrical repairs, remodeling of the station, etc.) The CAO's proposal is especially brutal on the City's emergency response capability. Since 1978 there 60 has been no increase in the number of fire "safety" personnel in spite of the fact that the city has grown and the 50 related amount of work for "safety" personnel (both routine and 40 46 emergency) has gone up dramatically. 45 41 CmTan 30 In actuality.there has already been a satetp drop of one (1) safety position in 20 1987. What is now being proposed is a further cut of four (4) safety 10 positions.. These five (5) positions represent an 11% drop from the 1979 level of service. (fig. 3 ) 0 1979 1993 Proposed (Fig. 3) . IldPACTS THE EIM IINATION OF ANY SAFETY POSITIONS SHOULD BE RECONSIDERED. All safety personnel, whether working a 56 hour/week "platoon" schedule or a conventional M-F 40 hour/week schedule ( ie. the Training Battalion Chief) are in great demand when emergencies occur.- At the very least, the elimination of safety positions reduces the number of off=duty, safety personnel available for emergency call back. We submit that the City's emergency force has been and continues to be at a barely acceptable level. As the level of emergency activity continues to rise the phenomenon of concurrent emergencies is happening more often. Two or three overlapping medical emergencies can require all on-duty personnel and leave the city unprotected. page 3 ■ THE EIXMNATION OF THE TRAINING BATTALION CHIEF POSPI'ION WELL HAVE A SEVERE LONG TERM EMPACT. The position can be deleted, but the function cannot be. Training, like prevention, is never appreciated enough until it is absent. An accepted axiom over the years has been that: FAILING TO TRAIN = TRAINING TO FAIL With the risk of hazardous materials accidents, earthquakes, nuclear disasters, and floods added to more common medical emergencies and fires, the scope of training for emergency responders is enormous. For a Firefighter, training correlates directly to safety. Training was attempted in this department many years ago without a dedicated position to oversee and coordinate it. It failed and the Training Officer position was created. If this position is eliminated we will follow this cycle again and have to later recreate the position and fill it. ■ THE ELDIINATION OF THE FIRE EDUCATION SPECIALIST ELMMATES THE BRIDGE TO EDUCATE OUR CMZENS, BOTH YOUNG AND OLD, WITH RESPECT TO FIRE AND LIFE SAFETY. As mentioned earlier, the position of Fire Education Specialist has been of enormous value to this city. The position has been instrumental in developing one of the best public education programs in the nation. Fire departments from all over the country have borrowed ideas from this city's program. If the City Council is sincere about desiring emphasis on prevention, it should avoid weakening a program that made over 17,000 contacts with children and adults in 1992. SUGGESTIONS ■ DON'T El.MMATE SAFETY POSMONS. FREEZE VACANCIES AND FILL MEMLATZR. We cannot in good conscience support filling present vacancies in this department when other current employees may be laid off. We suggest a freeze of the positions and delay filling until City finances improve. This will make any major incident more difficult to handle due to the reduction in the city's total emergency response force. This freeze will increase work-loads and stress the remaining employees in the department. page 4 OPEN DIRECT TALKS WITH REPRESENTATIVES OF EMPLOYES GROUPS. We, Firefighters, know of many good employee suggestions that have received little or no serious consideration. If there is interest in renegotiating contracts, have staff meet and confer with employee group representatives. COATEVUE TO PURSUE THE COST RECOVERY FOR EMERGENCY MEDICAL SERVICE PROVIDED BY FIRE PARAMEDICS. Patients are currently being:charged by the private ambulance company for both medical services provided by Fire Paramedics, and transport services provided by the ambulance. Beyond medical,service now provided by Fire Paramedics, significant further revenue is possible if the Fire Department begins providing ambulance transport service to the City and the surrounding area. This could be run effectively as an "enterprise.". ® - . CONSIDER CONSOLIDATING FIRE DEPARTMENT'S PREVENTION BUREAU AND TAE COMMUNITY DEVELOPMENT'S BUILDING DIVISION. Wetelieve that there is currently a duplication of functions.in these two departments. For example, inspection of new occupancies is made by both Fire Department and Building Division Inspectors. AGGRESSIVELY SEEK ALL POTENTIAL SOURCES OF REVF.IVUE Assign staff to study how the city of Santa Clara took over its local cable TV,service and made it into a public utility. We understand that this is now their single greatest producer of revenue. These are difficult times for all of us. We appreciate the difficulty facing you in making these tough decisions. If we can be of assistance or give you further information that you may desire, please ask. We will strive to continue to serve and protect the interests of San Luis Obispo's citizens. With sincerity on.behalf of The San Luis Obispo Firemen Association.- Dan Wunsch - Association President page 5 MEMORANDUM March 10, 1993 To: Honorable Mayor and City Council Members From: The City Employee Associations: SLOCEA, SLOPOA, ST..OFFA, SLOSPOA, Fire Battalion Chiefs' Assoc., Mid-Management/Confidential Employees' Association Subject: LAYOFF MMOATYON The employees'association supports the recommendations of the City Administrative Officer and encourages the City Council to strongly consider additional revenue enhancements and employee concessions in an effort to prevent loss of essential services and employees of the City. We recommend that the Council direct Administration to negotiate jointly Kith representatives of all associations apd return to Council with specific recommendations to protect vital community services which will be jeopardized by the loss of essential positions. RespccaUly submitted: SLOCEA President, Tim Girvin SLOPOA President, Thomas R Depriest SLOFFA President, Dan unsch SLOSPOA President, Tony Costa Fire Battalion Chiefs' Association President, Emir Willis Mid-Management Confides Employees' Association President, Dennis Cox �tll roc E Tz:> No Q(2 ► &?AUawzjZ� ala, 11V� PPvRCZF�D czwTpovEasr AG. aaT W C2lT1W PyLfv ttT MEETING - - AGENDA DATE -/ - 3 . 3.�� s� r� t� ►r1� �-Nc�a .��v�M�� ��n�xP►r�o�v _ G17 slot-. k)EE.D5 770 Bf- SGI�/E�llll� 1=02 k3l0L. DV�251(�r-tT� ffL�F"-Nt�726>��/�121 I?E. e-�11YG 0IO Af RJ P-KT-S 13101-- A'551;5s'ME4A 7' - - _ NODS TO BF- 01M. ov�-7zlGKis ' MA,R 13 .1993- 5 104.- .19935104._t5,5f:s5M.E1V 1iV1 r KVO ? `� . INADI✓QctG( S fi17,11TCL -`�Gffl�tiT f.Y . �3uuDD�FD Xaa-102541T� �tlL" VJ ATE 12 G-W �AJ)t 27' o f3D !� / A �� eF Er re= usF s - . SPt toE- FtC&U, 5A►U. 'S �19rsfb mf. pl 6015A uLY q vHc 14�5 7. 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ON GAS�^N--��21C /1C� �,V I W�• 21 � J��.I��j`"1�1� �Y C� I��y`Q r�T ���� T 1�G.U�. I . . :all l I�IR1 ..✓: r2I P. 15S:7Z�iG 3 /V r �-� (' ,fiVE. ND S -FF�J: lU�it% Voi b. ,,z:•Li IO S 10: - - A/l TXG A5 J J t�T/VE P�iki C.OPIM i0: ❑•Denotes Action ❑ FYI c« i C'CDDDIR. CAo ❑ > N.bIR._ . ACRO ❑ FIRECEl1EE iTOR�iEY ❑.FW DRC�Ci.� &Vzic. ❑ POLICEO-L ❑ MCMT.TFA.M LI P.EC DIR ` LE unLDIIL { Iv l,lsM�i�2 1 )F . M� �u L � S►ti. , {} 5-f I aI5 Q�isfC Gl7x� s5T- fF Pr D16X667-6HOIJ� 3E i%EING AGENDA DATE 3-13-93 I ITEM #_ IN -THf- G►T� !NG"Ik&A SITE'✓ RFLP Ik6U.RE INfo lWx GT`T--� �✓I,E1vT-5 M1t1)VWhWE t�N� �E1�EL�%�P��tFIVT �( c�TrS TD Y �VOL� ai:c; 3. �►�'T"I�� F► ,, Of,,.) E � �P,�-TD CWr4 J rWN_ GJ'Tff C}Tf��2 GtT� .�Pr�"IVl�1`�T� t`�� t"i �JJG!�:�►N��.C.�M�� 1l?1T�._.__ . xs9r9 FLA 4uL U-m,�5) 7"c.1,� tF�s itiin�lA L d�b1,a(�tC 1- b�-tv!f .. E.. f=, s EC.TS , of bEVE14Pn vT - � J LT.S T✓iDZC:;ICk L c:::�Aab 7 4 r � M i T 6AT-(^1JS �T- qrJt.42tSb i G{l: ti l� . U,.5 - G. 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