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05/03/2011 City CouncilEDMONDS CITY COUNCIL APPROVED MINUTES May 3, 2011 At 6:00 p.m., Mayor Cooper announced that the City Council would meet in executive session regarding labor negotiations. He stated that the executive session was scheduled to last approximately 60 minutes and would be held in the Police Training Room, located in the Public Safety Complex. No action was anticipated to occur as a result of meeting in executive session. Elected officials present at the executive session were: Mayor Cooper, and Councilmembers Bernheim, Plunkett, Fraley- Monillas, Buckshnis, Peterson, Petso and Wilson. Others present were Sharon Cates and Rosa Fruehling- Watson with the City Attorney's Office, Human Resources Director Debi Humann, Public Works Director Phil Williams, and City Clerk Sandy Chase. At 7:00 p.m., Ms. Chase announced to the public present in the Council Chambers that an additional 15 minutes would be required in executive session. The executive session concluded at 7:14 p.m. The regular City Council meeting was called to order at 7:19 p.m. by Mayor Cooper in the Council Chambers, 250 5`h Avenue North, Edmonds. The meeting was opened with the flag salute. ELECTED OFFICIALS PRESENT Mike Cooper, Mayor Strom Peterson, Council President Steve Bernheim, Councilmember D. J. Wilson, Councilmember Michael Plunkett, Councilmember Lora Petso, Councilmember Adrienne Fraley- Monillas, Councilmember Diane Buckshnis, Councilmember ALSO PRESENT Peter Gibson, Student Representative 1. APPROVAL OF AGENDA STAFF PRESENT Al Compaan, Police Chief Stephen Clifton, Community Services/Economic Development Director Phil Williams, Public Works Director Carrie Hite, Parks & Recreation Director Jim Tarte, Interim Finance Director Carl Nelson, CIO Leonard Yarberry, Building Official Debi Humann, Human Resources Director Rob English, City Engineer Mike Clugston, Planner Kernen Lien, Planner Jeff Taraday, City Attorney Sandy Chase, City Clerk Jana Spellman, Senior Executive Council Asst. Jeannie Dines, Recorder COUNCIL PRESIDENT PETERSON MOVED, SECONDED BY COUNCILMEMBER BUCKSHNIS, TO APPROVE THE AGENDA IN CONTENT AND ORDER. MOTION CARRIED UNANIMOUSLY. 2. CONSENT AGENDA ITEMS Councilmember Petso requested Item B be removed from the Consent Agenda. Edmonds City Council Approved Minutes May 3, 2011 Page I COUNCILMEMBER PLUNKETT MOVED, SECONDED BY COUNCILMEMBER WILSON, TO APPROVE THE BALANCE OF THE CONSENT AGENDA. MOTION CARRIED UNANIMOUSLY. The agenda items approved are as follows: A. ROLL CALL C. APPROVAL OF CLAIM CHECKS #125160 THROUGH #125253 DATED APRIL 28, 2011 FOR $584,989.02 D. FEMA BIOLOGICAL OPINION E. MAYORAL PROCLAMATION DECLARING THURSDAY, MAY 5, 2011 TO BE NATIONAL DAY OF PRAYER IN THE CITY OF EDMONDS. ITEM B: APPROVAL OF CITY COUNCIL MEETING MINUTES OF APRIL 26, 2011 COUNCILMEMBER PETSO MOVED, SECONDED BY COUNCILMEMBER WILSON, TO APPROVE ITEM B, CHANGING "$10 MILLION" IN THE FIRST PARAGRAPH ON PAGE 8 TO "$2 MILLION." Councilmember Plunkett suggested City Clerk Sandy Chase verify the audio and the minutes be approved at a subsequent meeting. COUNCIL PRESIDENT PETERSON MOVED, SECONDED BY COUNCILMEMBER WILSON, TO TABLE APPROVAL OF THE MINUTES. MOTION CARRIED UNANIMOUSLY. 3. RESOLUTION IN SUPPORT OF EDMONDS SENIOR CENTER'S CREATIVE TRANSITIONS PROGRAM. Council President Peterson explained the Edmonds Senior Center is seeking grassroots support for their new program working with unemployed seniors and baby boomers. The creators of the program spoke to Councilmember Buckshnis and him to request the Council's support of the program. Council President Peterson read a resolution expressing the City Council's support of Edmonds Senior Center's Creative Transition's program. COUNCIL PRESIDENT PETERSON MOVED, SECONDED BY COUNCILMEMBER BUCKSHNIS, TO APPROVE, RESOLUTION NO. 1250 IN SUPPORT OF EDMONDS SENIOR CENTER'S CREATIVE TRANSITIONS PROGRAM. Councilmember Buckshnis explained she drafted a more extensive letter regarding the program that Councilmembers could sign. Councilmember Fraley- Monillas reported she attended the Transition Program training held at the Senior Center and found the information very interesting. The definition of "senior" for the program is 54 years and older. Many people 54 years and older are currently unemployed. The Creative Transition program provides a great deal of information about getting hired, etc. THE VOTE ON THE MOTION CARRIED UNANIMOUSLY. Mayor Cooper advised he also provided a letter of support for the program creators to use when describing the program in other communities. Edmonds City Council Approved Minutes May 3, 2011 Page 2 4. REVIEW OF PLANNING BOARD RECOMMENDATION ON PROPOSED AMENDMENTS TO ECDC 18.05 AND 20.50 CLARIFYING DEFINITIONS AND PROCESSES FOR REGULATION OF WIRELESS COMMUNICATION FACILITIES (FILE NO. AMD- 2010 - 0004). Planner Mike Clugston explained the Planning Board has been reviewing this issue for the past year and held a public hearing on April 27 on amendments to the wireless communication code. Mr. Clugston explained this issue arose in January 2010 when several citizens on 96m Avenue West expressed their concerns to the Council regarding a PUD utility pole retrofit south of Westgate Elementary. He displayed a photograph of the utility pole as it currently exists. At that time, the Council referred the matter to the Planning Board, asking that the Planning Board be as restrictive as possible with regard to new poles without limiting coverage. Amendments to the code are a Type V legislative action; the Planning Board makes a recommendation to the City Council. The Planning Board met nine times between April 2010 and April 2011 to discuss amendments and the Architectural Design Board (ADB) also reviewed the amendments at their February 16, 2011 meeting. He explained federal regulations prohibit local municipalities from excluding wireless communication facilities and wireless facilities cannot be regulated on the basis of health impacts if they meet federal criteria for radio frequency emissions. Within those federal regulations, Edmonds can regulate the location of different types of facilities and the appearance using design standards. He explained Edmonds is largely residential and hilly. As a result of previous Council action, the current code does not allow new monopoles in residential areas and states co- location on existing taller structures such as utility poles and buildings is preferred. Wireless regulations are currently contained in two sections of the Code: • ECDC 18.05 — Utility Wires. Addresses facilities in unzoned rights -of -way. Updates in 2006 and 2008 added the following: • Specified wireless antenna separation distance for mounting on utility poles • Required use of wooden poles • Initiate public notification process • Additional design standards for facilities • ECDC 20.50 — Wireless Communication Facilities. This chapter addresses: • Wireless code for zoned parcels • Existing design standards for certain types of antennas and facilities • Interrelated with ECDC 18.05 o Last updated in 1996 He displayed a photograph of a large metal pole on Edmonds Way following a retrofit and a better designed wooden pole with several antennas at the top. He displayed a chart with the location, design review required, and size requirements for micro, mini, macro, monopole 1, monopole 2 and lattice towers. The Planning Board found the current regulations of antennas and monopole and lattice towers needed to be revised. He displayed a photograph of a typical looking monopole located near Highway 99, identifying the pole structure, sets of antennas, and equipment enclosure. He also displayed a photograph of antennas on top of the Swedish - Edmonds Hospital building that blend well and illustrate a good use of co- location. At a July 28, 2010 Planning Board public hearing, a variety of changes were proposed for ECDC 18.05 and ECDC 20.50. Testimony at the hearing led to reconsideration of the proposed changes and further work on both 18.05 and 20.50.The following concepts were identified for incorporation: • Cannot regulate based on health impacts • Technology changes Edmonds City Council Approved Minutes May 3, 2011 Page 3 Prioritized location preferences, encourage co- location, use existing sites to prevent new monopoles FCC "shot clock" established permit timeframes — requires municipalities review co- location permits within 90 days of complete application and new monopoles within 150 day Clear permitting and review processes As a result of the public hearing and concepts for incorporation, it was determined the existing wireless code in ECDC 20.50 needed a comprehensive overhaul. He described the new framework of 20.50, identifying new sections that provide additional guidance for staff and the industry. Prohibitions in ECDC 20.50 include: • Guyed or lattice towers • New monopoles in: o Residential zones • Rights -of -way • Public and open space zones • Downtown Waterfront Activity Center as identified in the Comprehensive Plan He displayed a photograph of a lattice tower, advising they would not be allowed under the proposed amendments. Via a Conditional Use Permit, the code currently would allow a new monopole in the Downtown Waterfront Activity Center. The general design standards address co- location, noise, business license, signage, temporary parking for installation and maintenance, finish, design, color lighting, advertising, equipment enclosure, RF compliance, landscaping and screening. Chapter 20.50 identifies wireless location preferences: 1. Co- location of wireless antennas at existing wireless 2. Co- location at an existing site where additional height is necessary over existing 3. Placing antennas on a replacement pole or structure for an existing one 4. Placing antennas on a new pole or structure altogether 5. Wireless providers must demonstrate during the application process how a location meets their needs and if co- location is not proposed, why not Mr. Clugston displayed photographs of building- mounted antennas including somewhat visible antennas on the Harbor Building, and antennas mounted next to a chimney on a condominium that are less visible. He reviewed building mounted facility standards: • Downtown Waterfront Activity Center • No extra height allowed • Antennas flush - mounted to building • Existing over- height buildings okay • Equipment cabinet and cabling must be screened or painted to match • All other locations 0 9 feet extra height allowed o Integrate antenna appearance with existing structure o Equipment cabinet and cabling must be screened or painted to match Councilmember Wilson inquired about the location of the Downtown Waterfront Activity Center. Mr. Clugston displayed a map of the Downtown Waterfront Activity Center, advising it includes all the BD zones, Harbor Square, the waterfront, and up to 9`" Avenue. Mr. Clugston displayed photographs of structure- mounted facilities on a PUD pole retrofit and on the Esperance water tower. The proposed language for structure - mounted facilities includes: Edmonds City Council Approved Minutes May 3, 2011 Page 4 Utility pole retrofit language from ECDC 18.05 — 15 -foot separation distance, wood poles required Allow extra 6 foot height for antennas (currently no limit on height) Equipment cabinet, antennas and cabling must be screened or painted to match Mr. Clugston displayed photographs of monopole facilities including a monopole on Highway 99 and a shrouded monopole near Firdale where antennas are mounted within the structure. Regulations regarding monopoles include: • Least preferred alternative • Providers must prove why co- location is not possible • Location restricted • Equipment cabinet and cabling must be screened or painted to match • Conditional Use Permit (Type III -B) required if height proposed is in excess of underlying zone • Must meet setbacks of underlying zone; exception possible if new location retains existing trees and open space, provides better screening, or moves facility further from residentially -zoned property Mr. Clugston reviewed proposed permitting for wireless facilities: • Specific application requirements • Type of permit depends on type of facility • Building permit — co- location • Engineering right -of -way permit — retrofits • Conditional Use Permit (Type 11 for utility pole retrofits, Type 11 -B for monopole exceeding height requirement of underlying zone • Specific timeframes identified • Design review with every application • SEPA, as required by RCW • Co- location encouraged through simpler permit process Councilmember Plunkett referred to Exhibit 13, page 1, a photograph of the monopole on 96`h Avenue West next to a tree. He asked what prevented the City from requiring the provider to make the communication device look more like the tree in the photograph. Mr. Clugston answered the Planning Board did consider that. There is nothing that prevents it; some municipalities require that. In the examples the Planning Board reviewed, the end result was not always what the municipality had envisioned. For example on paper it may look like a pine tree but in practice it looks like a cell phone installation with sprigs sticking off a pole. The Planning Board concluded that a monopole designed to look like a tree did not fit in developed landscape. Councilmember Plunkett questioned why the result would be as Mr. Clugston described rather than look like a tree. Mr. Clugston reiterated on paper it may look one way but in practice it looks another way. Councilmember Plunkett questioned why a monopole could not be disguised better. Mr. Clugston commented in most of the pictures he has seen, it is not done well. He noted a few municipalities have actually gone away from requiring camouflage due to the poor results. Councilmember Plunkett commented the communication companies had enough money to install a pole and make it look like a tree if they wanted to. Mr. Clugston agreed it would seem enough money could make a pole look like a tree; however, the examples he has seen do not look tree -like. The Planning Board decided not to pursue that option, finding that adding antennas to an existing 60 foot utility pole within a developed landscape was not unreasonable. Monopole locations have been restricted in the proposed amendment. On Highway 99 for example where there may be no other vegetation, a fake "mono- tree" may look worse than a monopole in a developed landscape. Edmonds City Council Approved Minutes May 3, 2011 Page 5 Councilmember Petso relayed concerns from neighbors of the pole on 96`" Avenue West with vehicles visiting the site to do maintenance. Vehicles are either parked dangerously in the road or in residents' yards or landscaping. She asked if the regulations require parking for the poles. Mr. Clugston answered there is currently no parking requirement. The proposed regulations require the location of temporary parking to be identified whether it is in the right-of-way, in a private driveway, etc. Councilmember Petso asked if one or two parking spaces were required. Mr. Clugston answered the proposed regulation did not speak to the number but he anticipated it would be one. Councilmember Petso asked if more than one truck would be brought to a pole at a time. Mr. Clugston answered they could bring several. The requirement is to identify temporary parking in the right -of -way, on the property, on an adjacent driveway, etc. Two spaces could be required if the Council desired. Councilmember Petso asked where in the code the parking requirement was located. City Attorney Jeff Taraday referred to 20.50.050(f), "the application must demonstrate there is sufficient space for temporary parking for regular maintenance proposed for the facility." Councilmember Buckshnis recalled health concerns were raised in January regarding a Clearwire tower and asked whether that type of tower could be installed under these regulations. Mr. Clugston answered the installation on 96`" met the requirements in the existing code. The Telecommunications Act of 1996 does not allow regulation based on health impacts or the exclusion of wireless facilities. Councilmember Buckshnis asked whether studies had been done on health impacts. Mr. Clugston answered they have. Councilmember Buckshnis commented there are monopoles designed to look like cactus and palm trees. She asked why camouflage was not practical. Mr. Clugston answered it could be done; the end result often does not achieve the intent — to disguise the facility. In the examples he has seen, it looks like a monopole with some cactus kind of material around it or a spruce or fir tree that looks like a monopole with sprigs of tree sticking out. The Planning Board chose not to pursue that approach but it could be done. Councilmember Buckshnis noted the City did not bear the cost, the provider bore the cost. For example, the poles she has seen in San Diego actually look like palm trees from a distance. Councilmember Bernheim asked whether Mr. Clugston had seen examples of monopoles designed to look like a tree. Mr. Clugston answered he had not seen any in person, just pictures on the internet. Councilmember Bernheim asked if there were any in Washington. Mr. Clugston was not aware of any in Washington. He knew of a 200+ foot tall antenna in a rural area in New York with some evergreen -type material at the top. Councilmember Bernheim suggested for the public hearing that members of the public who think camouflage is a good idea pay particular attention to examples. There are camouflaged poles in Florida that are much more aesthetically attractive. If one considers that the poles provide service for their cell phone, they may not care what they look like. He suggested obtaining examples of poles that are designed to look like trees. Councilmember Petso asked if the City can prohibit wireless facilities in parks. Mr. Clugston answered the proposed regulations prohibit monopoles in parks. An antenna would be allowed if there were existing structures buildings in a park that could be used. Councilmember Petso asked whether a wireless facility could be prohibited in a park. Mr. Clugston answered no. If there is a gap in coverage and the only place for a provider to locate is in a park, the City could not deny it. Councilmember Petso asked how the only possible place for siting a facility in park would be determined. Mr. Clugston advised the new regulations ask providers to describe how they chose the location. A provider would be encouraged not to locate in a park but if there was no other suitable location such as a nearby PUD pole, they could site an antenna in the park to fill a gap in coverage. The application process will include a description of how they addressed the gap in coverage. Edmonds City Council Approved Minutes May 3, 2011 Page 6 Councilmember Plunkett asked if there were any legal problems with requiring a pole look like an indigenous tree and be good enough to pass the ADB's and Council's review. Mr. Taraday answered there were potential issues with subjective interpretation. For example, reasonable minds could differ over what looks like an indigenous tree. If the Council wanted to proceed in that direction, to have new monopoles appear tree -like, he recommended developing specific design review examples. He did not anticipate a significant legal issue if there were appropriate pictures to guide administrative discretion and if what was illustrated was commercially feasible. Councilmember Plunkett inquired about ADB review of wireless facilities. Mr. Clugston answered the ADB currently reviews monopoles. In the future there will be design standards in the regulations that will be reviewed at staff level. Councilmember Plunkett commented the Council could require ADB review. Mr. Taraday advised the permit procedure is up to Council discretion. There are strict federal timelines in the process; whatever procedure the Council chooses must meet those timelines. Mr. Clugston commented if appropriate design standards that include pictures and language are adopted, review could be done at the staff level. Council President Peterson asked if there was risk in making an installation prohibitively expensive via the design standards. Mr. Taraday cautioned the City against requiring anything that was prohibitively expensive. Given the current prioritization for new antennas, the monopole is last on the list. The fake tree concept is only an issue if a provider cannot meet one of the other location priories. It is unlikely that many new monopoles will be needed due to the prevalence of utility poles and other structures where an antenna can be located. COUNCILMEMBER BERNHEIM MOVED, SECONDED BY COUNCIL PRESIDENT PETERSON, TO SET A PUBLIC HEARING. COUNCILMEMBER PLUNKETT MOVED, SECONDED BY COUNCILMEMBER PETSO, TO REFER THIS TO THE PLANNING BOARD WITH DIRECTION TO CREATE A TREE MONOPOLE WITH ADB REVIEW THEREOF. Council President Peterson commented because the Planning Board had considered that issue and due to the amount of time they have devoted to the issue of wireless facilities, he preferred to hold the public hearing and seek input from the public. Following the public hearing the Council could refer it to the Planning Board or provide direction to staff. Councilmember Bernheim preferred to hold the public hearing, commenting it is an appropriate point in the process for the public to voice their concerns to the City Council. If there are additional concerns, they can all be referred to the Planning Board rather than just the tree -like appearance of a pole. Councilmember Plunkett agreed with Councilmember Bernheim. He asked if revisions to the code related to requiring a pole look a tree would require further review and recommendation by the Planning Board. Mr. Taraday answered State law contemplates that City Councils will make changes to Planning Board recommendations. The Planning Board considered that issue so it would not be necessary to return it to the Planning Board. COUNCILMEMBER PLUNKETT WITHDREW HIS MOTION WITH THE AGREEMENT OF THE SECOND. THE VOTE ON THE MAIN MOTION CARRIED UNANIMOUSLY. Council President Peterson advised the public hearing will be scheduled on June 7 which will give staff sufficient time to conduct additional research. Edmonds City Council Approved Minutes May 3, 2011 Page 7 Councilmember Wilson commented he is particularly interested in public comment regarding the tradeoff between a wooden monopole and a tree -like pole. 5. DISCUSSION OF LEVY OPTIONS. (PUBLIC COMMENT WILL BE RECEIVED) Mayor Cooper advised several staff members were present to answer Council questions. Interim Finance Director Jim Tarte will review the up -to -date forecast and Building Official Yarberry will address the question raised at the last Council meeting regarding staffing in the Planning & Building Departments. Public Comment Ron Wambolt, Edmonds, repeated the comments he made at the April 26, 2011 meeting as that meeting was not televised due to technical difficulties. Although $32.5 million is a lot of revenue to operate the City for one year, it is not enough when imprudently allocated. He expressed concern that staffing costs funded at boom year levels left little for street overlays or other infrastructure maintenance. He cited Development Services as an example of boom -year staffing; there were three times as many projects three years ago, Architectural Design Board meetings are frequently cancelled because there are no proposed projects to review and not a single project has been constructed in the five BD zones since they were created five years ago, yet staffing levels have not been reduced. Although other government bodies in the State have negotiated a variety of concessions from their workers to help alleviate revenue shortfalls, the Council has been unable to do the same. He acknowledged some staff took 9 furlough days in 2009; however due to the COLA increase, their total pay in 2009 was still above 2008. Because the Council has misallocated the use of City revenues, he urged voters not to support a levy in 2011. He suggested the 2012 budgeting process do what the Council or Mayor would not do, cut staffing costs and reduce expenses to bring them in line with revenue and reduced demand for certain services. He was hopeful after elections in November, concessions will be negotiated to allow restoration of some of the 2012 budget cuts before they are implemented. Citizens may then be more inclined to vote for a smaller levy in 2012. Don Hall, Edmonds, pointed out Mayor Cooper's proposed levy will only fund half the amount needed for street overlays. If the Council supports a levy, he urged them not to do it halfway, fund the $1.5 million needed for overlays. Other items in Mayor Cooper's proposal such as Yost Pool and the Flower Program in the General Fund are emotional issues that get people to vote. He did not support a levy unless concessions were made in employee contracts with regard to contribution to healthcare costs. The State and other cities ask for and receive concessions from their employees. Although the Council is working to stabilize costs, there will be increases over time and he supported the employees and employer sharing the increase. Although it will be a long time before the economy recovers, when it does, the City will need money to do the things it has not been able to do. Everyone needs to contribute, the taxpayers and employees, to solve the City's long term budget problems. Al Rutledge, Edmonds, referred to the Mountlake Terrace May 2 City Council meeting where there was a presentation regarding Lake Ballinger. Mountlake Terrace is proposing funding for Lake Ballinger and they have indicated Edmonds is not involved. He suggested the Council, 1) include funds in a levy for Lake Ballinger, and 2) consider consolidating the Fire, Police and Parks departments to reduce expenses. Roger Hertrich, Edmonds, referred to the Executive Summary — Current Forecast that indicates increases in salaries and wages and benefits through 2016 and substantial increases in supplies. He suggested salaries not be increased unless revenue was increased. There would be no need for a levy as long as wages are kept equal to revenue and the City held the line on wage negotiations. He commented on the cost of the survey initiated by Mayor Cooper, asserting the questions were designed to obtain the answers the survey wanted. He asked the survey taker who was behind the survey and was told the City of Edmonds. Mayor Cooper indicated he had hired a company to conduct the survey to find out whether Edmonds City Council Approved Minutes May 3, 2011 Page 8 citizens would support a levy. Mr. Hertrich suggested the $18,000 Mayor Cooper spent on the levy could have been used to explain the City's financials to the Council and to determine whether the City needs more money. When he told Mayor Cooper the survey questions had little validity, Mayor Cooper responded the survey results will show the Council the need for a levy. Building Official Leonard Yarberry displayed Development Service staffing as presented during the 2011 budget discussion: 3 FTE Administration (including vacant Director) 6 FTE Planning 4 FTE Building 3 FTE Permitting 16 FTE Total Mr. Yarberry displayed a graph of staffing/1000 population and building permits issued 1985 -2010. He noted staffing levels have fluctuated slightly but remain fairly consistent. The current 16 employees are not dissimilar to staffing in the early 90s, late 80s. During the peak periods in 2004 -2006, the City used a lot of consultants. Expenditures for consultants in those years were fairly high, particularly in building and planning. That was due to projects sent out to plan review consultants rather than reviewed in- house. The City also had a part -time inspector during peak periods. With regard to staffing, the question is what service level the Council wishes to provide. Through April 2011, Building has issued 305 permits; the total construction valuation for those permits is $8.7 million. Through April 2005, Building issued 358 permits with a construction valuation of $26.8 million. Approximately 50 more permits were issued in 2005 but 3 times the construction valuation. He summarized there was not a decline in the number of permits but the size and type of permits. There are fewer bigger projects and more small projects. People are spending money on small projects to improve their homes, small additions, and maintenance. Those types of projects tend to take more staff time because the applicants are do- it- yourselfers who tend to have less expertise than professional contractors and developers doing larger projects. He offered to provide further details. Mayor Cooper asked how many building inspectors the City has and whether two were sent out on a project. Mr. Yarberry answered the City has one dedicated Building Inspector. On occasion two people do visit a project but that is unusual. For example, today the Building Inspector and Plan Reviewer visited a site that originally started under an old permit; the permit had elapsed, the bank took over the project, and a new contractor is working on the project. Typically only one inspector visits a site. Mayor Cooper assured staff continued to consider staffing levels during the budget process. Council President Peterson suggested Mr. Yarberry provide a comparison of expenditures in the boom years for outside consultants compared to now. Mr. Yarberry recalled when the 2011 budget was prepared the consultant line item was reduced by 60 -65 %. Councilmember Fraley - Monillas asked about the fluctuation in the number of permits in the past five years. Mr. Yarberry reviewed the line graph illustrating building permits for 1985 -2010, noting the peak years 2005 -2006. Councilmember Fraley - Monillas noted the number of permits does not appear to fluctuate much. Mr. Yarberry commented the scope of the projects change, not the number of permits. That is illustrated by the valuation differences; this year the construction valuation of the permits through April was $8.7 million versus $26.8 million in 2005. Councilmember Fraley - Monillas asked how many permits were issued in 2009. Mr. Yarberry estimated slightly over 900. Councilmember Fraley- Monillas asked the number of permits issued in 1985. Mr. Yarberry answered 600. Edmonds City Council Approved Minutes May 3, 2011 Page 9 To Mr. Wambolt's comment that citizens should not support a levy, Councilmember Wilson noted if he claimed citizens should support a levy, he would be accused of electioneering from the podium. He suggested there be less of that in the future. There have been considerable employee give -backs in healthcare; at the bargaining table they are being moved to a new health plan with higher co -pays and a different benefit design that saves the City $30,000 /month. That is a considerable give -back. He disagreed the Council was not looking at expenses; consideration is given to expenses all the time. During the levy review process two years ago, it was clear to all participants that the problem was not an expense problem but a revenue problem. There have been some very aggressive, animated, enthusiastic conversations at the bargaining table with unions. He assured the Council was trying its best and would not ask the public to consider a levy had they not bent over backward to reduce expenses. For example a Development Services Director has not been hired due to reduced activity and the City laid off a cop last year. He summarized he wanted to counter the claim that the Council was doing nothing to reduce expenses. Interim Finance Director Jim Tarte explained he has been the Interim Director for six weeks. Mayor Cooper and he applied the 2010 unaudited actuals to the forecast; the forecast previously contained an estimate of 2010. The ending working capital was $2,815,000; applying the actual 2010 numbers reduced that to $2,759,000, dropping the balance by a mere $56,000. The Finance Department reports the numbers; the individual directors are responsible for following the budget. In his private industry experience, he had not seen actuals that close to the estimate. Mr. Tarte referred to the 2011 budget and 2011 . outlook on the Executive Summary — Current Forecast, explaining the 2011 outlook incorporates the 2010 actuals and projected revenues and expenses. The revised forecast incorporates the following changes: 0 $100,000 budgeted in 2011 for the ECA payment was increased to $200,000 0 $350,000 deduction due to implementation of a new healthcare plan January 1, 2012 Councilmember Buckshnis asked Mr. Tarte if he planned to attend the May 10 Finance Committee meeting as she has several questions. Mr. Tarte advised he will attend the meeting. Councilmember Buckshnis explained the mid -year amendment that balanced all fund balances was the reason the actuals are so close to the budget. She asked whether $2,759,000 was the General Fund ending cash balance. Mr. Tarte explained that was the City's working capital balance. Councilmember Buckshnis asked whether he was still using the modified working capital approach. Mr. Tarte answered yes; the City has always used a modified working capital approach. Councilmember Buckshnis advised that would be discussed at the Finance Committee meeting as there is interest in moving toward a modified accrual accounting standard, which is a cash basis. Councilmember Bernheim asked Mr. Tarte if he was aware of any other city that used the beginning working capital accounting methodology. Mr. Tarte answered he had not researched any other cities' approach. He will research that in the week before the Finance Committee meeting. Councilmember Bernheim asked whether he was aware of the accounting methodologies used by other cities in Washington. Mr. Tarte answered no; his background is in private industry. Councilmember Petso referred to Mr. Hertrich's comment regarding the substantial increase in the supply line item, an increase of over $100,000 between 2011 and 2012. She asked the reason for the increase. Mr. Tarte suggested he research that for the Finance Committee meeting. Councilmember Petso suggested the Executive Summary — Current Forecast be scheduled as an agenda item for the Finance Committee. Mayor Cooper answered it was presented tonight in response to the Council's request for long term projections and how that related to the one month reserve target. With regard to the increase in the supply line item, that had not been changed and was the same number shown in the budget approved by the Council. He agreed the reason for the increase needed to be explained. Edmonds City Council Approved Minutes May 3, 2011 Page 10 Mayor Cooper commented there are varying opinions regarding a modified accrual accounting system versus a cash based accounting system. He asked whether changing to a different accounting system would affect how far in the red the City was in 2013. Mr. Tarte answered no; changing from one accounting method to another did not miraculously add cash to the bank account. It basically changes how revenues and expenses are recognized; the bottom line does not change by a material amount and leaves more subjective reporting of accruals in the hands of the accountants which can be problematic if the accruals are wrong. Mr. Tarte pointed out the ending working capital balance is approximately $700,000 below the target in 2012, significantly below the target in 2013 and the ending working capital balance is a negative amount in years 2014 and beyond. Mr. Tarte commented as he reviewed the numbers, he noticed miscellaneous revenues in 2010 of $1.9 million compared with $531,000 in 2009 and dropping again in 2011 and beyond. The $1.9 million includes the sale of a significant asset, the City's Fire Department. If the City had not done that, the ending working capital balance would be significantly less. As the Council considers a levy and the citizens consider whether to approve it, he pointed out without a levy or cuts in core services, the City will need to consider what assets it can sell. He noted that was simply his observation. Recognizing Mr. Tarte as someone who is here on a short term basis and does not have a dog in the fight, Councilmember Wilson expressed his appreciation for Mr. Tarte's observations, his frankness and the matter of fact that the City is where it is financially due to the sale of an asset. It's not rocket science, the City either needs to raise revenue, make cuts or sell assets. Mr. Tarte commented he had experienced this situation with private industry; when a company was in financial turmoil, costs can be cut but only so much before it cut into the ability to generate revenue. Councilmember Wilson viewed the City as an undercapitalized municipal corporation with depreciating assets and depreciating human capital due to poor morale. He was glad the City was able to buy a year via the contact with FD1. The City cannot continue to fund basic services without some additional revenue. He suggested anyone who doubted that to consider Mr. Tarte's objective perspective. The City will always be able to make the numbers look better but will not be able to keep the lights on unless a levy is passed. He urged the Council not to make perfect the enemy of good. Mr. Tarte can be considered an outside consultant who took a fresh look at the City's financials and has said the City needs to find more money, sell assets or make cuts. As the levy committees determined, the City has a revenue problem. The City has made cuts but at the end of the day, it is a revenue problem. The City can sell assets which cut into core services and /or the City's identity or the City can make a good presentation to the voters regarding why a levy is needed. Councilmember Plunkett thanked Mr. Tarte for his presentation, commenting it was a pleasure to have someone from the private sector review the City's finances. He also expressed the Council's appreciation for Mr. Tarte's confidence and his soothing approach. Councilmember Buckshnis offered to send Mr. Tarte her questions, noting the CAFR shows a $5,188,520 fund balance compared to the working capital balance which results in a lot of unanswered questions. Mr. Tarte agreed there was a great deal the City could do to make their finances more clear. Councilmember Buckshnis commented on her research of other cities' financial reports. Mayor Cooper relayed preliminary findings of the polling. He clarified he told Mr. Hertrich that he thought the polling information would be helpful to the Council as they deliberated their decision. He hired a very reputable company who he has worked with in the past. He hired this company without consulting with the City Council because he is authorized to execute professional services contracts in his position as CEO of the City and within certain guidelines established in City Code and State law. Some of the findings support the proposal he made to the City Council and some of details the polling company Edmonds City Council Approved Minutes May 3, 2011 Page 11 will present in more detail at next week's meeting support some of the things that have been proposed by Councilmembers. The polling consultant, Alison Peters, reviewed preliminary information with the directors and him today. Generally speaking, the voters are open to some form of a property tax levy and increasing their taxes; approximately 48% are willing to modestly increase their property taxes. A modest increase is the amount of his levy proposal, $130 /year on the average home in Edmonds. There are also a lot of red flags in the polling that staff and the Council will need to consider. One of those is the voters' highest priority was to use the money to shore up the budget to continue the City's current level of core services. Another clear message in the polling was support for maintenance rather than capital projects; taking care of what we have and not raising taxes to build new things. Respondents also placed a high priority on streets, parks and public safety. Nearly 3/4`" of the respondents placed the highest priority on the need for the City Council to gain unanimous approval and put forward a united package to the voters. The respondents asked the City to be specific about how the money would be spent. He summarized it was encouraging that a higher than average number of voters recognized that some type of levy was necessary as long as it was modest, took care of existing infrastructure and continued core services rather than capital projects. Ms. Peters will provide more details regarding the polling at the May 10 Council meeting. Councilmember Fraley- Monillas commented she will not base her decision for a levy on a poll; responses can be influenced based on how questions are asked. She did not believe a poll would convince her to do one thing or another. A poll can give an indication of how voters are leaning but she would not base her decision regarding a levy on a poll. Having been involved in politics for the past 25 years, she is aware that polling questions can manipulate the answer. She summarized the citizens deserved a greater thought process from an elected official than just a decision based on a poll. She advised she would be absent from the May 10 meeting. Mayor Cooper agreed Councilmembers should not base their decision solely on the information from the poll. The poll was written to collect statistically valid information and give the Council information regarding the voters' feelings to assist in their decision. After reviewing the polling information, he may suggest a different approach to a levy. There are two reputable polling companies in Seattle; the person he hired is one of the two. He encouraged Council to keep an open mind when reviewing the polling information. He assured the pollster would not tell the Council what to put on the ballot; they will simply relay what voters are thinking. That information will be very helpful to the Council as they package a levy. Councilmember Fraley- Monillas referred to Mayor Cooper's indication that one of the respondents' priorities was unanimous support by the Council. She questioned how that response had been elicited. Mayor Cooper explained there was a long list of questions for respondents to prioritize; unanimous Council support was prioritized very high by over 3 /4th of the respondents. Councilmember Fraley- Monillas asked if the Council will be provided the polling questions. Mayor Cooper answered the Council will be provided a presentation regarding the polling results and when the work is complete, the questions will be provided. He cautioned about looking at the raw questions without hearing the polling company's description of the statistics and how the questions fit together. He explained it was a question about what is important to the person; of the list of 10 -12 items, respondents rated the Council reaching unanimous consensus on a levy the highest. He acknowledged the Council did not have to reach unanimity but not doing so affected the ability of a levy to pass. Councilmember Fraley - Monillas looked forward to seeing the presentation, report and polling questions. Councilmember Buckshnis asked whether the Council will be provided the questions that were asked in the poll. Mayor Cooper answered when the pollster provides the City a finished product, the questions will be a public document. Edmonds City Council Approved Minutes May 3, 2011 Page 12 Councilmember Buckshnis advised during presentations to the Citizen Levy Committee, Lake Forest Park, Shoreline and the Edmonds School District agreed unanimously that a levy was important. Shoreline had one Councilmember who did not support the levy. The cities agreed Council and staff unanimity was also important. Mayor Cooper supported the Council working to get to a unanimous vote; if they cannot, that they continue working until a levy is developed that the entire Council can support. The more agreement there is on the Council, the more likely a levy is to pass. He referred to the 4 -3 decision to place the Transportation Benefit District (TBD) vehicle license fee on the ballot that the voters ultimately did not support. He recalled Edmonds School District Superintendent Nick Brossoit saying before the School District places a levy or bond issue on the ballot, they work on it until the entire Board supports it. That should be an important consideration for the Council. Councilmember Wilson disclosed Alison Peters is a friend of his and he has hired her on two occasions in the past ten years. He did not have any input into her selection to conduct this poll. Observing that Councilmembers will be absent from upcoming meetings, he asked whether they can participate by telephone. City Clerk Sandy Chase answered yes, that has been done in the past. Because May 24 is the deadline to communicate to the County Auditor, Councilmember Wilson asked whether the May 24 Council meeting could be rescheduled to May 23. Council President Peterson answered yes. Councilmember Wilson commented that would give the Council three more meetings after tonight to make a decision regarding a levy. He wants to have a levy on the August ballot and asked Councilmembers to comment on whether his suggestion last week regarding a $700,000 street maintenance levy and $400,000 - $500,000 in parks maintenance was something they could support. He would also like to add funding for the uniformed officer that was cut and for Crime Prevention. Councilmember Fraley - Monillas referred to the article in the Edmonds Patch from Chief of Police Al Compaan regarding the decrease in crime in Edmonds last year, relaying her concern with spending $200,000+ on a crime analyst. She recognized the Police Department's efforts in reducing crime but that article does not support a request for additional Police Department staff. Councilmember Wilson asked whether she supported funding for street and parks maintenance. Councilmember Fraley - Monillas explained she supported the TBD vehicle license fee increase and believes the City's streets need to be repaired. It was unfortunate that fee increase was not supported by the entire Council. Mayor Cooper commented if the Council makes its decision regarding a levy on May 23, the City Clerk needs to submit the following to the Auditor by the next day: • Resolution /ordinance • Explanatory statement for the ballot title • Appointments of the pro and con committees (pro and con statements due seven days later) Councilmember Bernheim commented it is interesting to compare the current levy proposal with the July 2009 proposal. The proposal that Councilmember Wilson and he developed in 2009 had funding for fire, police, parks, information systems infrastructure, a part -time Human Resources assistant and an additional employee in the City Clerk's office which is very different than the current levy discussions. He believed the voters were responsible citizens and would support a levy if they think about it rather than listening to positions they wish they could support. He acknowledged no one wanted to pay taxes but part of being a patriotic American was paying one's fair share of the social costs; it is un- American to say we must cut government spending and that mindset did a great disservice to society. He supported including funds in the levy dedicated to road maintenance, possibly along with other items. Repaving of roads cost $1.5 million /year; he supported including that in a levy along with a promise that maintenance would be deferred unless the funds were provided. If the citizens do not want to pay higher taxes for Edmonds City Council Approved Minutes May 3, 2011 Page 13 roads, the roads will continue to deteriorate. He summarized he was willing to start with $1 million - $1.5 million/year for roads. If the voters do not approve it, he was happy to stop resurfacing roads for a year. Councilmember Bernheim pointed out in the Tim Eyman era, government must bring proposals for tax increases to voters. Without requests for increases, revenues will continue to decline relative to government costs. It is completely unrealistic to demand the City not pay any more for labor this year when the cost of health insurance is increasing 10 -15 %. He summarized government would never be less expensive in subsequent years. He favored a $1.5 million levy for road overlays; if the voters did not approve it, the City saved $1.5 million. Mayor Cooper reminded there would be no savings as there are currently no funds in the budget for overlays. Council President Peterson commented the Council appears to be in general agreement on the need for revenue but there appears to be some stumbling blocks such as the lack of financial clarity. As Mr. Tarte stated, even if the methodology is changed, the numbers remain the same. If the method needs to be changed to achieve unanimity for a levy, there is a very tight timeline. He described the upcoming schedule: • May 10 — Special City Council meeting at 7:00 p.m. with Committee meetings at 6:00 p.m. Community Services /Development Services Committee may be cancelled as Councilmembers Plunkett and Fraley - Monillas are not available. Finance Committee meeting starting at 5:00 p.m. Some items on the Finance Committee agenda may be deferred to a future meeting. • May 17 — Decision regarding a levy so there is time to get the pro /con committees established, etc. • May 23 — Special City Council meeting (in lieu of May 24 meeting) if a decision is not made May 17 Council President Peterson expressed support for including funding in a levy for road maintenance and deferred maintenance. He suggested the Council agree on those two items and then begin discussing more contentious items such as funding for public safety. Councilmember Buckshnis explained in June 2010 there was a financial statement where an amendment was embedded that was not approved by the City Council which resulted in the General Fund being overstated by $735,000; in September the amendment was not changed or footnoted in the quarterly; in December there were no reports other than a data dump; and there are no reports for March. She expressed concern with the Council making a decision about operating based on nothing other than the updated projection which again used a modified working capital approach that is not sanctioned by GFOA and is not used by any other City and the CAFR reports a $6 million fund balance. She could support $1.5 million for streets, $500,000 for Public Works maintenance, and $300,000 for parks maintenance. With regard to operating, she preferred to wait for a November levy due to the numerous unanswered questions. Council President Peterson commented if Councilmembers cannot get beyond the City's financial reporting methodology, he needs to know that before calling a special meeting on May 23. Councilmember Buckshnis reiterated her willingness to support for $1.5 million for streets, $500,000 for Public Works maintenance, and $300,000 for parks maintenance. Council President Peterson referred to the updated forecast that illustrates the City will be in the red within the next couple years. Everyone supports road maintenance but that does nothing to the ending working capital balance because funding for road maintenance is new money. He did not expect that Mr. Tarte would be able to answer all the Council's questions at the Finance Committee meeting, but questioned whether enough progress could be made to reach a happy medium. He agreed with Councilmember Wilson's suggestion not to let perfection be the enemy of the good. Edmonds City Council Approved Minutes May 3, 2011 Page 14 Councilmember Buckshnis assured the goal was not perfection; she was interested in citizen - friendly reports. Two years ago the forecast showed the City would be in the red by 2012. The projection has been changed, without any increase in revenue, and suddenly the City is not in the red until 2014. Her goal is citizen - friendly reports that allow citizens to see that there is $1.962 million in the Emergency Reserve, $3 million in the General Fund, and $1.3 million in the Public Safety Reserve. None of that is explained and citizens are questioning why they should support a levy when they cannot see the City's financial condition on the City's website. She did not agree with the forecast provided tonight. Council President Peterson asked if the reports needed to be changed before a levy was placed on the ballot. The Council has a great opportunity to make progress next week with a fresh, unbiased set of eyes, basically a consultant who has no vested interest in the levy. If the Council continues to have this conversation at every Council meeting for the next three weeks and until the election, the levy will not pass. He was hopeful that holding the Finance Committee meeting prior to the Council meeting would allow the finance questions to be answered or at least get the process moving. Councilmember Wilson commended Councilmember Buckshnis for her determination on the reporting issue and recognized the reason she continually brings it up is because she has not gotten answers to basic questions. He anticipated that was changing as evidenced by a new approach in the Mayor's office and a new Finance Director. He appreciated her support for $1.5 million for streets, $500,000 for Public Works maintenance, and $300,000 for Parks maintenance. He reminded the Council that the City also needed enough in reserves to maintain the other core services for 3 -4 years. He did not support placing a $1.5 million levy on the ballot for streets and spending all that money without funds to cover the shortfall. He fundamentally believed the City needed more uniformed police officers and no one could change his mind. However, he was willing to set that aside, one of the reasons he ran for City Council in the first place, to get something on the ballot. If the Council placed a levy on the ballot in August and the voters approved it, the Mayor can provide a much better 2012 budget. If the voters do not approve a levy, then the next Council can make a decision regarding a spring 2012 levy. He did not anticipate the same kind of support for a November ballot. Councilmember Wilson observed most Councilmembers, with the exception of Councilmember Petso, were supportive of funding for streets in an amount ranging from $700,000 to $1.5 million. Most also support some funding for parks. He was willing to support funding for Public Works maintenance. He was willing to set aside funding for police if the Council could agree on other items. He asked whether the Council could support a levy with $700,000 for streets, $300,000 for Parks maintenance and $300,000 for Public Works for a total of $1..3 million plus an additional $1.2 million for the reserves, the approximate amount needed to get through 4 years. This is a total of a $2.5 million levy versus Mayor Cooper's proposed $2.26 levy. A $2.5 million levy is approximately $0.40 /$1.000 AV versus Mayor Cooper's proposal of $0.35/$1000 AV. He suggested staff be asked to prepare that in a formal draft for Council consideration and public comment next week. Councilmember Fraley- Monillas commented she needed more information such as what $700,000 for streets, $300,000 for Parks and $300,000 for Public Works would pay for. Although those amounts were recommended by the Citizen Levy Committee, she wanted to know how the funds would be used. Mayor Cooper commented there was approximately $285,000 /year in deferred parks maintenance. Parks & Recreation Director Carrie Hite reviewed a list of deferred maintenance she prepared after a tour of the City's parks that includes: • $50,000 subsidy for Yost Pool • $35,000 for the Flower Program 0 Citywide restroom improvements • Gateway signs and entrances Edmonds City Council Approved Minutes May 3, 2011 Page 15 • Turf and drainage • Citywide parking lot asphalt and pathway improvements • Replace downtown trash containers • Downtown street pruning • Rehabilitating tennis and basketball courts Mayor Cooper offered to provide the Council the list of deferred park maintenance projects. Councilmember Fraley - Monillas requested further detail also be provided by Public Works. Mayor Cooper encouraged the Council to review the PowerPoint that lists deferred building maintenance. He reminded deferred maintenance was not funded currently so funding for those items does not address the operating deficit. COUNCIL PRESIDENT PETERSON MOVED, SECONDED BY COUNCILMEMBER PETSO, TO EXTEND THE MEETING FOR 30 MINUTES. MOTION CARRIED UNANIMOUSLY. Councilmember Petso requested the Council differentiate between capital expenditures, maintenance expenditures and operating expense. Although Mayor Cooper stated the list of parks deferred maintenance would not address operations, there are operating items on the list in addition to deferred maintenance. If financial issues cannot be resolved to a certain level, she feared the degree of unanimity on the Council will be very different. If there is unanimity to propose a levy for $700,000 for street overlays, she suggested the Council agree on that and consider it step one. COUNCILMEMBER PETSO MOVED, SECONDED BY COUNCILMEMBER BERNHEIM, TO PUT A $700,000 LEVY ON THE BALLOT FOR STREET MAINTENANCE. COUNCILMEMBER BUCKSHNIS MOVED, SECONDED BY COUNCILMEMBER FRALEY- MONILLAS, TO AMEND THE MOTION TO $1.5 MILLIONIYEAR FOR THE NEXT 3 YEARS. Councilmember Petso commented unanimity had been lost with that amendment. Councilmember Fraley - Monillas commented $700,000 does not cover street overlays. In order to justify the $1.5 million, she would prefer to know first what it would pay for, whether it would fund more than citywide overlays. Councilmember Wilson agreed with Councilmember Fraley - Monillas' request for further information, not only for the Council's benefit but for the public's benefit. He would not support the amendment because he preferred a 4 year levy rather than 3. He could support $1.5 million for streets, but a levy must at least also cover the operating deficit for the next few years. He summarized new money was good but the operating deficit also needs to be covered. He was not currently willing to use the Public Safety Reserve Fund or the Emergency Reserve Fund. Unless funds are included in a levy to cover the operating deficit, the $1.5 million for overlays would not be a great deal of help; the City could buy asphalt but not pay staff to fix the streets. Councilmember Bernheim commented it is the City's responsibility to fix the streets. He reiterated perfect should not be the enemy of the good; if the City needs to raise money to fix the streets, that should be done while other problems are addressed. With regard to the amount, the impact of $1.5 million /year for 3 years on an average household in Edmonds was approximately $75/year. He reiterated citizens did not deserve to drive on the City's roads for free just because they paid for their car, gas, car tabs, insurance, etc. Citizens have to expect to pay the public portion of the cost. Everyone is focusing on their own selfish expenses such as gas and forgetting the social cost to keep qualified people in the Public Works, Police Department, Engineering, etc. He preferred to start with $700,000 for the first year in order to earn Edmonds City Council Approved Minutes May 3, 2011 Page 16 public trust. He noted unanimity was not necessary on specific proposals; the Council can be unanimous in their support for a final levy proposal. Councilmember Wilson did not envision a levy for streets alone would pass and he would not support the motion. He could support a levy with $1.5 million for streets if it also included at least $1 million for reserves to cover the one month balance over 4 years and at least $300,000 for parks. He reiterated the City had a revenue problem regardless of the numbers in the CAFR; revenues do not keep pace with expenses. Councilmember Petso commented she did not want to go to $1.5 million yet, she may consider that later. There may be other sources of funding for roads such as via the TBD; there are other maintenance needs, and she recognized that these are tough times. She suggested the City begin showing citizens it is responsible by doing overlays and increasing the amount when times are better. Mayor Cooper relayed $1.5 million would cost the property owner of a $400,000 house approximately $93 /year, slightly less for the average Edmonds home valued at $375,000. Councilmember Bernheim advised he would opposed $1.5 million as he favors $700,000. Councilmember Fraley- Monillas asked whether the $1.5 million would become a ballot measure if the amendment and motion are approved by the Council. Councilmember Wilson clarified the motion directs staff to prepare a resolution. Mayor Cooper suggested Public Works Director Phil Williams provide details regarding what $700,000 versus $1.5 million buys. 1\X119101704 1910111 V.111I a D1 7IK'f1LK11wrol I 11► iplain D1 A;11rf1 MI: 1.I fIuV ell I16NU M Do Councilmember Wilson restated the main motion as follows: DIRECT STAFF TO PREPARE A RESOLUTION COMMUNICATING TO THE AUDITOR THAT THE CITY OF EDMONDS WANTS TO GO TO THE BALLOT WITH A $700,000 STREET LEVY. COUNCILMEMBER WILSON MOVED, SECONDED BY COUNCIL PRESIDENT PETERSON, TO AMEND THE MOTION TO INCLUDE $400,000 FOR PARKS MAINTENANCE. Councilmember Wilson suggested starting with $400,000, advising he was willing to lower the amount. His intent was to have staff identify what that amount would fund such as the Senior Center, Yost Pool, general parks maintenance, etc. He urged the Council to approve the amendment, noting the amount could be lowered to $300,000 next week. Councilmember Fraley- Monillas asked whether the Edmonds Center for the Arts is funded by the Parks Department. Mayor Cooper answered that debt is primarily a General Fund expenditure and one of the reasons for the deficit. Councilmember Wilson explained his next amendment would be $1 million -$1.2 million for reserves for the levy period to fund all the deficits. Councilmember Plunkett commented Mayor Cooper's memo references $102,000 /year for parks and $285,000 in deferred maintenance. He asked for clarification regarding maintenance versus deferred maintenance. Ms. Hite answered Mayor Cooper's proposal included $100,000 for parks to cover the Yost Pool operations subsidy and the Flower Program. The $285,000 covers citywide restroom improvements, gateway signs, parking lot asphalt and pathway improvements, turf and drainage, and play structure Edmonds City Council Approved Minutes May 3, 2011 Page 17 maintenance, replace trash containers, street tree pruning, and tennis and basketball court upgrades. The City does not currently have an ongoing play structure maintenance program and some of the maintenance has been deferred. Councilmember Wilson inquired about the line item for parks maintenance. Ms. Hite answered it was $1.379 million. Councilmember Wilson wanted to ensure some of that came from a dedicated funding source. Councilmember Petso advised she had gone as far as she could tonight and could not entertain any levy items until after next week's Finance Committee meeting. She was concerned with adding operating expenses such as Yost Pool, advising she fully expected Ms. Hite to operate Yost Pool in a revenue neutral manner like was done previously and was not inclined to ask the voters for money to subsidize pool operations. She agreed with Councilmember Fraley - Monillas that the ECA was a recreation facility and anticipated it may even be REET eligible. Councilmember Fraley - Monillas agreed with Councilmember Petso, finding it difficult to make decisions at 10:30 p.m. She suggested the Council continue this discussion next week. Council President Peterson expressed his support for this amendment and likely the next amendment. He emphasized these votes are not set in stone; the Council was directing staff to return with further information. The votes on these items direct staff to provide information for a more detailed discussion at a future meeting. The votes on these items did not mean that a Councilmember would support placing a levy on the ballot as evidenced by his support seven times two years ago for a levy and then he ultimately did not support a levy. Councilmember Plunkett explained his concern with the amendment was the difference between operating and maintenance. He requested staff provide an amount strictly for maintenance that did not include the Flower Program or Yost Pool operations. He was concerned with including funds for operating in a levy due to the lack of transparency. In spite of Mr. Tarte's review, he did not agree that the City had a revenue problem; there is also an expenditure problem. When one line item, medical benefits, increases by 30% over 5 years, that is an expenditure problem, not a revenue problem. Labor and wages increase 11% over 5 years. He summarized $2.6 million of the $4.8 million increase in expenditures over the next 5 years is in those two line items. He does not support $400,000, $300,000 or even $250,000 for parks unless he could be assured it was strictly for maintenance. Councilmember Fraley - Monillas advised she would not support the amendment or any further amendments tonight with the information that has been provided. COUNCILMEMBER WILSON MOVED, SECONDED BY COUNCIL PRESIDENT PETERSON, TO POSTPONE TO THE NEXT MEETING. Councilmember Wilson explained discussion on the motion and the amendment will be continued at the May 10 meeting. 104 Loll V 11100Y.] "1 11 3101 ri n. r,1 .11 a UG &I r r •� COUNCIL PRESIDENT PETERSON MOVED, SECONDED BY PLUNK TO EXTEND THE MEETING FOR 15 MINUTES. UPON ROLL CALL, MOTION CARRIED (5 -2), COUNCILMEMBERS PLUNKETT, WILSON, BUCKSHNIS AND PETSO AND COUNCIL PRESIDENT PETERSON VOTING YES; AND COUNCILMEMBERS BERNHEIM AND FRALEY- MONILLAS VOTING NO. Edmonds City Council Approved Minutes May 3, 2011 Page 18 Mayor Cooper explained Mr. Williams and Ms. Hite will prepare additional information in advance of the May 10 meeting regarding what maintenance means, how the money might be spent, etc. Councilmember Plunkett suggested staff also comment on deferred Public Works maintenance. Mayor Cooper advised there is a list of deferred building maintenance. He explained $1.5 million /year forever is needed to restore the City's overlay cycle. 6. AUDIENCE COMMENTS Ron Wambolt, Edmonds, was astounded by Councilmember Bernheim's statement that it was un- American to cut government spending. He referred to the Council and Mayor's reaction to his comments regarding the levy and offered the following rebuttal: in response to his claim that Development Services was overstaffed, he was reminded that Edmonds has far fewer employees relative to population than a city such as Lynnwood. To that he urged the City to benchmark itself with the best rather than the worst. In the boom years, Lynnwood's sale tax was five times Edmonds' and they employed a massive number of people and are clearly suffering in the current economy and have had to do severe downsizing. In response to his lament that the Council has done nothing to gain concessions from employees or reduce their numbers, he was reminded the Mayor has responsibility for managing staff. While true, during the 2011 budget process the Council could have questioned positions such as the Development Services Director, pressuring the Mayor to reduce staff and seek employee concessions. The issue he raised regarding concessions has not been addressed. His suggestion to reduce staff was countered with it is unwise to let staff go due to costly training when the economy improves. While a consideration, it is only prudent to maintain full staff if the surplus is expected to be short term. He hoped citizens would join him in urging the Mayor and City Council to make cuts before raising taxes. He acknowledged a levy increase is needed but cuts need to be made first. Al Rutledge, Edmonds, expressed concern that $1.5 million for street overlays equated to a $40 TBD vehicle license fee. Darrol Haug, Edmonds, explained earlier this year Mayor Cooper invited him to join Council President Peterson, Councilmember Bernheim and him to consider how report generation could be improved for the public. The City of Redmond's reports have been proposed as a good example; they are easy to read and available on Redmond's website. The Citizen Levy Committee visited Redmond to learn about their levy and met with Redmond's Finance Director and other finance staff. He contacted Redmond's Finance Director and obtained their entire report generator in Excel files. Today he entered Edmonds data and created six reports that he provided to the Mayor, Council President Peterson and Councilmember Bernheim as examples of how Edmonds' data might appear in a different format. He suggested the Council immediately begin creating a few of the reports to clarify the City's financial position. He urged the Council not to let hiring a new Finance Director slow the effort to create reports. He volunteered his time to assist the City in creating the reports. 7. MAYOR'S COMMENTS Mayor Cooper commented on Mr. Wambolt's statements. He assured staff expenditures were reduced in the 2011. In 2010, wages including merit pay were frozen for non -union staff and in 2011 the budget reduced the authorization for merit pay from 3% to 1.5 %. Concessions have been made and unions are working cooperatively with the City. 8. COUNCIL COMMENTS Councilmember Wilson commented in 2008, his first year on the Council, $1 million was cut from expenses during the budget process. Expenses in 2009, the year $1 million in cuts were made, were $32.9 Edmonds City Council Approved Minutes May 3, 2011 Page 19 million, $33.8 million in 2010 and budgeted to be $32.3 million in 2011. He summarized 2011 expenses are budgeted to be lower than 2010 and 2009 expenses. With regard to Council discussions about a levy, he was happy to be part of a discussion that will take as long as it takes. He assured Councilmembers Plunkett, Petso, Buckshnis and Fraley - Monillas that he will bend over backward to get their votes. If their vote required that all the funding for parks maintenance be allocated only to parks maintenance, that will be clearly addressed in the resolution. He expressed his appreciation for their input and engagement in the process. Councilmember Petso advised the Economic Development Commission (EDC) will soon have a vacancy created by the resignation of a member appointed by her predecessor, Dave Orvis. She invited anyone interested in serving on the EDC to contact her. Councilmember Fraley- Monillas commented while the City is in negotiations, the Council cannot make any statements. She assured Mr. Wambolt and others that the Council has heard their concerns but it is inappropriate to comment on labor negotiations. Councilmember Buckshnis thanked Mr. Haug for his comments and offered to assist him with creating reports. She wished all the moms Happy Mothers Day. U E_i With no further business, the Council meeting was adjourned at 10:50 p.m. Edmonds City Council Approved Minutes May 3, 2011 Page 20