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08/24/2010 City CouncilEDMONDS CITY COUNCIL APPROVED MINUTES August 24, 2010 At 6:15 p.m., Mayor Cooper announced that the City Council would meet in executive session to discuss a pending claim /potential litigation and labor negotiation strategy. He stated that the executive session was scheduled to last approximately 45 minutes and would be held in the Jury Meeting 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 City Attorney Scott Snyder, Attorney Mark Bucklin, Human Resources Director Debi Humann, and City Clerk Sandy Chase. The executive session concluded at 7:54 p.m. The regular City Council meeting was called to order at 7:01 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 Steve Bernheim, Council President D. J. Wilson, Councilmember Michael Plunkett, Councilmember Lora Petso, Councilmember Adrienne Fraley- Monillas, Councilmember Strom Peterson, Councilmember Diane Buckshnis, Councilmember 1. APPROVAL OF AGENDA STAFF PRESENT Al Compaan, Police Chief Stephen Clifton, Community Services /Economic Development Director Brian McIntosh, Parks & Recreation Director Lorenzo Hines, Finance Director Rob Chave, Planning Manager Debi Humann, Human Resources Director Carl Nelson, CIO Debra Sharp, Accountant Rob English, City Engineer Sandy Chase, City Clerk Jana Spellman, Senior Executive Council Asst. Jeannie Dines, Recorder i i i i i i i 1 1 C i , i i i i 1 i i 1 i COUNCILMEMBER BUCKSHNIS MOVED, SECONDED BY COUNCILMEMBER PETERSON, TO APPROVE THE AGENDA IN CONTENT AND ORDER AS AMENDED. MOTION CARRIED UNANIMOUSLY. F�Kil►f.`l i1 ►Y WA" 91117111 Y i1► (.`l Councilmember Peterson requested Item F be removed from the Consent Agenda. COUNCILMEMBER PLUNKETT MOVED, SECONDED BY COUNCILMEMBER FRALEY- MONILLAS, TO APPROVE THE REMAINDER OF THE CONSENT AGENDA. MOTION CARRIED UNANIMOUSLY. The agenda items approved are as follows: Edmonds City Council Approved Minutes August 24, 2010 Page 1 A. ROLL CALL B. APPROVAL OF CITY COUNCIL MEETING MINUTES OF AUGUST 16, 2010. C. APPROVAL OF CLAIM CHECKS #120748 THROUGH #120863 DATED AUGUST 19, 2010 FOR $868,092.51. APPROVAL OF PAYROLL DIRECT DEPOSIT AND CHECKS #49687 THROUGH #49848 FOR THE PERIOD AUGUST 1 THROUGH AUGUST 15, 2010 FOR $667,388.42. D. ACKNOWLEDGE RECEIPT OF A CLAIM FOR DAMAGES SUBMITTED BY DONNA L. BRESKE ($344.67). E. ACCEPTANCE OF LIST OF BUSINESSES REAPPLYING FOR LIQUOR LICENSES WITH THE WSLCB. G. RESOLUTION NO. 1233 — APPROVING PUBLIC PARTICIPATION PLANS FOR THE 2010 PROCESSES RELATING TO THE UPDATES OF THE STREET TREE PLAN, COMPREHENSIVE PLAN PURPOSE, EFFECT AND CONTEXT STATEMENTS, AND CAPITAL FACILITIES PLAN, ALL ELEMENTS OF THE EDMONDS COMPREHENSIVE PLAN. ITEM F: CONFIRMATION OF REAPPOINTMENT OF MARIA MONTALVO TO THE EDMONDS PUBLIC FACILITIES DISTRICT BOARD. Councilmember Peterson disclosed Maria Montalvo is his wife. COUNCILMEMBER PETERSON MOVED, SECONDED BY COUNCILMEMBER PLUNKETT, FOR APPROVAL OF ITEM F. MOTION CARRIED UNANIMOUSLY. 3. AUDIENCE COMMENTS Marianne Zagorski, Edmonds, Edmonds Economic Development Commission, explained in addition to the tremendous potential that fiber optics has to improve the City's revenue stream, fiber optics will also play a crucial role in healthcare in the future. Swedish Hospital plans to invest $100 million in the coming years to upgrade services and technology; fiber optics will play a key role. The City needs to act now so that the City is ready to provide Swedish with fiber capacity when they need it. If the City is not ready, the result will be either decreased income for the City and /or a delay in high quality healthcare services resulting in the potential for increased illness and increased loss of life. She urged the Council to approve the fiber optics proposal that will be presented later on the agenda; the life they save may be their own. Natalie Shippen, Edmonds, reiterated two questions she has asked the City Council, first, what are the multimodal connections mentioned in the ferry system's long range plan for $26 million in Edmonds to enhance multimodal connections. The City's reply was this was a placeholder for unspecified future enhancements to multimodal connections. No specific projects have been scoped at this time. The second question, what is the one important project scheduled to be completed in Edmonds in the 2029 -2031 biennium that will total $26 million. She has received no reply from the City to that question. She viewed the use of the word placeholder as a dodge rather than an answer. Edmonds and three other port towns will receive major improvements in the not too distant future of 15 -20 years; the improvements in the other cities are identified: Mukilteo will relocate its terminal but not the overhead loading to a site to the north, Anacortes will replace its terminal building, Seattle will replace the north trestle, terminal building and electrical upgrades. She displayed a drawing of the Main Street ferry terminal with a second slip, one of five drawings illustrating a second slip contained in a 1994 Ferry Terminal Improvements report. She Edmonds City Council Approved Minutes August 24, 2010 Page 2 asserted the ferry system knew exactly what they planned to do and she urged the City to ask on her behalf or their own behalf what $26 million project would be constructed in Edmonds. Donna Breske, Edmonds, requested the City refund the stormwater utility fees for the undeveloped lot that she and her husband own at 9330 218`'' Place Southwest. She relayed the Washington State courts found stormwater fees convey an area wide benefit and allow fees to be applied to developed and undeveloped properties. However, that finding does not apply to their situation since the City asserts that their lot is a drainage facility. The Edmonds Hearing Examiner's decision of August 2008 states the City has regarded lot 1 as a drainage facility for the plat of Westgate Village. There is a City - installed storm drainage system capable of conveying stormwater runoff from the applicable 2.5 acre area within the plat of Westgate Village that was installed by the City in 2002. However, she is not allowed to use that drainage conveyance system. A May 14, 2008 letter from the former Public Works Director Noel Miller states any work the City has performed previously adjacent to lot 1 was to alleviate flooding incidents to the adjoining residential properties within the plat of Westgate Village and was not in any way to promote the development of lot 1. She referred to an engineering drawing they submitted a year ago with an infiltration gallery under the house. City Engineer Rob English's response dated September 8, 2009 required lot 1 be the drainage repository for a 6.5 acre basin of which 4 acres are outside the plat of Westgate Village. She summarized the City could not determine her lot to be a drainage facility for the plat and also collect drainage utility fees and the perhaps the City should be paying them stormwater utility fees. Roger Hertrich, Edmonds, urged the Council to heed Ms. Breske's comments. Next, with regard to fiber optics, he urged the Council to reach a conclusion with regard to the financial status of the project. With regard to his previous comments that WSF would park a ferry overnight if a second slip were constructed, he stated the ferry would be a spare and parked there all day blocking views. He referred to Ms. Shippen's comments regarding a $26 million project, and urged the Council to seek a response from WSDOT regarding that project. With regard to land use project permits, Mr. Hertrich estimated the number of permits were down 50% in 2008 and 2009 and suggested the City could reduce staff by that amount. He questioned the response to his comments at the Citizen Levy Committee meeting about determining employees' qualifications. 4. AMENDMENT TO INTERLOCAL AGREEMENT WITH SNOCOM. Police Chief Al Compaan explained this item was removed from last week's Consent Agenda and a decision delayed to allow Councilmembers to seek further information. The agenda memo describes the issue in detail and he offered to respond to Council questions. COUNCILMEMBER PETSO MOVED, SECONDED BY COUNCILMEMBER WILSON, TO AUTHORIZE THE MAYOR TO SIGN THE AMENDMENT TO THE INTERLOCAL AGREEMENT TO RETURN FIRE DISTRICT 1 TO SNOCOM AS A VOTING MEMBER. Councilmember Wilson commented this was unanimously approved by the SnoCom Board and both he and Chief Compaan supported it. MOTION CARRIED UNANIMOUSLY. 5. QUARTERLY UPDATE ON ACTIVITIES OF CASCADE LAND CONSERVANCY AND SUSTAINABLE EDMONDS Councilmember Plunkett requested in the future the reports from Sustainable Edmonds and Cascade Land Conservancy be included in the Council packet. Edmonds City Council Approved Minutes August 24, 2010 Page 3 Todd Cloutier, Sustainable Edmonds, explained Sustainable Edmonds is an all volunteer, non profit committed to finding ways to make Edmonds a more sustainable community. He presented the second quarterly update of the Save Energy Now program, a program the Council voted to support with $5000 in funding last December. He displayed a comparison of 2008 and 2009 electricity and natural gas consumption. Edmonds citizens spent $38 million on utilities in 2009. He displayed a comparison of average 2008 and 2009 commercial and residential electricity and gas utility bills, approximately $9100 /year for a business and $1900 /year for a residence. A 10% savings on utilities represents an approximately $4 million "stimulus" package. Save Energy Now was a pilot project to find the most cost effective ways for homes and businesses in Edmonds to reduce utility usage via 10 homes and 10 businesses participating in a pilot program. The Council funding is used to partially offset the cost of a home energy audit. The audits are useful in identifying and prioritizing energy savings actions. Based on what the auditor finds, the participants then begin taking action to reduce their usage as much as possible, for as little investment as possible with a goal of at least a 10% sustained savings on their utility bills. During the program, which lasts for one full year, Sustainable Edmonds tracks participants' progress in lowering their bills. Sustainable Edmonds also tracks utility bills of all Edmonds residents as well as the weather. Sustainable Edmonds set up an online blog ( http : / /edmondsenerg .blogspot.coM) where lessons learned by participants are posted. They also email this information to the Sustainable Edmonds email list of friends, about 300 families. Their goal at the end of the pilot program is that all participants have saved 10% in their utilities and that they can sustain that savings over time. Mr. Cloutier reported six months into the program, the combined utility bills of participants are down 12 %. Although this is ahead of the goal of 10 %, approximately 7% is due to mild weather. The goal was 10 businesses to participate in the program, to date 5 have signed up. He explained the average home has already achieved savings of $250+ this year. One family has saved $460 and are committed to reaching a $1000 savings by the end of the year. He displayed a graph comparing 2009 usage, the 10% savings goal, heat demand, and actual natural gas usage, summarizing the program was ahead of goal with regard to natural gas usage. He displayed a similar graph for electricity, explaining the program is slightly below goal in electricity but well under 2009 usage. A graph of the costs illustrated approximately $2500 savings this year for the 10 families participating in the program. Barriers to the success of their program include that more business participants are needed and the challenge to communicate lessons learned from the pilot project to other residents. Opportunities include the Sustainable Works program that was presented to the Council last week that mirrors much of the Save Energy Now program as well as provides subsidized retrofit work and subsidized energy audits for some income levels. He encouraged Edmonds and Lynnwood residents to learn more and sign up for the Sustainable Works program online at www,sustainableworks.com. Approximately 20 people were signed up for the program at Saturday's Farmers Market. Mr. Cloutier provided the Sustainable Edmonds email address: SustainableEdmonds @gmail.com for anyone interested in obtaining more information or businesses interested in signing up for the program. Councilmember Fraley- Monillas asked how information was disseminated to Edmonds citizens. Mr. Cloutier explained the Save Energy Now program was first advertised to families on the email list and then door -to -door. They advertised the program via the Chamber of Commerce's email list as well as a door -to -door campaign. Several businesses have indicated inability to participate due to landlord tenant relationships. He suggested interested landlords could also apply for the Sustainable Works program. The Edmonds City Council Approved Minutes August 24, 2010 Page 4 Save Energy Now program subsidized by the City is at its capacity for residents; the City Council funded 10 homes and 10 businesses as a pilot project to show that it works. The pilot project illustrates to residents that the energy audit will assist them in identifying the most cost effective ways for energy savings such as insulation, water heaters, and reduced consumption before making large investments such as windows which are more expensive and provide less energy savings. Councilmember Buckshnis requested Mr. Cloutier email his PowerPoint presentation to the Council. As one of the ten homes participating in the Save Energy Now program, Councilmember Peterson thanked Sustainable Edmonds for developing the program. He commented the energy audit was a painless process and he was impressed by the professionalism of the company conducting the audit, their ideas and findings. The auditor found the windows in his 1970s home were in good condition and recommended other ways to save energy such as turning down the water heater and adjusting the thermostat. By doing those things, they have realized a significant reduction in their bill. Jeff Aken, Cities Program Project Manager, Cascade Land Conservancy (CLC), relayed the City Council voted last December to become a leadership City, a $5000 contract that committed CLC to provide the City with a livability assessment, 25 hours of staff time and participation in the Learning Network of Member Cities. He provided a quarterly update, explaining they have been giving presentations to area organizations including the Rotary and the Port as well as discussing with Sustainable Edmonds ways to work together. They have also conducted outreach to Edmonds Community College, Edmonds Bike Club, Edmonds Boys & Girls Club and various citizen groups and citizens. He reported the Livability Assessment is underway; the City is in the process of completing the questionnaire which will be followed by interviews conducted by CLC and a presentation of the findings. The Assessment looks at policies where Edmonds is showing leadership and opportunity for sustainable urban development in the built environment, and other cities' ideas that may work in Edmonds. He described the Community Stewards Program, a grant funded program CLC brought to Leadership Cities. The goal of the program is to engage citizens in the planning process in a proactive, positive manner at the policy stage. This began with the workshop on May 27 where a presentation on Complete Streets Policies was attended by approximately 35 Shoreline and Edmonds residents. An Edmonds - specific event was held on July 13 with approximately 17 community members. This was an opportunity for CLC to learn about transportation issues in neighborhoods. They have also begun outreach regarding Complete Streets with City staff and Councilmembers to determine the City's interest in the policies and whether it would be appropriate for CLC to draft a model ordinance for Council consideration. The Learning Network is underway and included a presentation on Complete Streets Policies in May. Future meeting topics include community gardens /urban agriculture and a form -based code workshop with America Association of Architects. Leadership City members receive reduced or free admission to those events. The 25 hours of staff time will be used for CLC to work with the UW students /instructors on the Five Corners and Westgate project. CLC will engage the community, community participation and feedback, and provide visuals /pictures of potential development in those areas. Councilmember Buckshnis advised Council President Bernheim and Councilmembers Fraley- Monillas, Peterson and she were working with CLC on Complete Streets presentation in early September. Edmonds City Council Approved Minutes August 24, 2010 Page 5 8. CONTINUED DISCUSSION AND POTENTIAL ACTION RELATED TO A PROPOSED MARKET STUDY FOR THE FIVE CORNERS AND WESTGATE COMMERCIAL CENTERS. Planning Manager Rob Chave explained this was a follow -up to the Council's discussion earlier this month regarding the proposed market study. Jill Sterrett, University of Washington, provided a memo recommending the lower cost, $10,000. The goal at this stage is a planning level study and it is likely the City may wish to do future follow -up study but it is not needed at this early planning stage. Councilmember Buckshnis expressed her support. She asked whether the $10,000 cost of the study could be reallocated from the vacant Development Services Director position. Mr. Chave responded there were more than sufficient funds available from that source that could be allocated to fund this study. COUNCILMEMBER BUCKSHNIS MOVED, SECONDED BY COUNCILMEMBER PLUNKETT, TO ALLOCATE $10,000 FOR THE MARKET SURVEY FROM THE SALARY SAVINGS OF THE VACANT DEVELOPMENT SERVICES DIRECTOR POSITION. Councilmember Petso explained since voting against the neighborhood study, she had conducted further research including meeting with members of the Economic Development Commission (EDC). She was not convinced this would be more than "another study for the shelf." She was also not convinced this was the most important proposal /request for funds from the EDC; it was simply the first request to be presented to the Council. She suggested the EDC prioritize future funding requests. Councilmember Plunkett asked what additional requests the EDC planned to make. Councilmember Buckshnis, Council liaison to the EDC, responded the recommendations in the resolution from the EDC that the Council approved contains seven items including a Strategic Plan that may have funds associated with it. She planned to submit a recommendation to the Council to extend the EDC for an additional 18 months. She emphasized the study done by the UW students will provide a template for Westgate and Five Corners. The Port is undertaking a similar study for Harbor Square utilizing UW students. Councilmember Plunkett commented the resolution also references the EDC's involvement with a business plan /marketing for fiber. Councilmember Buckshnis expressed a preference to begin budgeting for studies such as this in the future. Mr. Chave explained the timing of this request was related to the ability to utilize UW classes that may not be available next year and the required relatively low cost. Council President Bernheim commented development at Five Corners was one of his high priorities and he was supportive of this project. He supported utilizing UW students at fairly affordable rates. Councilmember Peterson explained this was one of the top priorities in the seven recommendations in the resolution the Council adopted and planning for Five Corners and Westgate has been one of the Council's top priorities. This funding request and the funding the Council previously approved for Sustainable Edmonds and Cascade Land Conservancy are examples of what a nominal amount of money can do via leveraging organizations that have a great deal of volunteer and community support and, in the case of the UW, have great graduate and under - graduate students. He thanked the EDC and staff for coordinating this effort and expressed his enthusiastic support. MOTION CARRIED (6 -1), COUNCILMEMBER PETSO OPPOSED. 9. EDMONDS FIBER OPTIC BROADBAND INITIATIVE — BACKGROUND AND UPDATE Councilmember Plunkett explained this was not an effort by only the Citizens Technology Advisory Committee (CTAC); it was a collaborative process between CTAC, the Economic Development Commission (EDC) and staff. He thanked the members of CTAC, recognizing several members who were Edmonds City Council Approved Minutes August 24, 2010 Page 6 in the audience. He also recognized EDC members who were involved in the effort, as well as staff members. He referred to materials in the Council packet including a background paper, fiber financial information and a resolution reaffirming the Council's commitment to this project. This presentation is an opportunity to update the public and Council on the financials associated with the Fiber Optic Broadband Initiative. In addition to business aspects of fiber, the City is also saving money as a result of fiber. Public Education Accounts (PEG) provide revenue. Targets of opportunity will be presented to the Council with a cost/benefit analysis and opportunity to approve an Interlocal Agreement. An overall business plan is being developed by CTAC and EDC. CTAC supports continuing the fiber project, the EDC has approved it from an economic point of view, and Mr. Hines has vetted the numbers. He recognized Darrol Haug for developing the background paper that describes the history of the Fiber Optic Broadband Initiative. The background paper indicates the project began in 2005 with 24 strands and excess capacity. Approximately $500,000 has been expended to date; those funds will be recouped by 2015 if no new accounts are added. Finance Director Lorenzo Hines explained in 2005 WSDOT offered Edmonds access to a fiber optic backbone network as a result of a right -of -way transaction where the City was allowed to keep this asset. With that opportunity came the challenge of determining how Edmonds could utilize the capacity of the backbone for the benefit of the citizenry. He displayed a map of the existing multi- strand fiber network from the ferry terminal to downtown Seattle. He provided a comparison of broadband capabilities, from dial -up (64 Kpps phone line) to 100 Mbps Ethernet, explaining one strand of fiber provided tremendously more capacity. Fiber is a great asset for moving information and a great asset to make available to businesses and citizens. The Council created the CTAC in 2004 to explore options to optimize the savings and revenue from the network and to develop alternatives to use the capacity for internal savings and position the City to sell excess capacity to citizens, businesses, and non - governmental entities in order to generate revenue in excess of costs. In 2009 the City sought court approval to sell its excess capacity to customers other than governmental agencies. In October 2009 the Superior Court of Washington granted the City's motion supporting the City's ability to sell excess capacity to private individuals and non - governmental businesses. CTAC initially approached Comcast and FrontierNerizon and they were not interested in partnering with Edmonds. FrontierNerizon initially announced plans to install their FIGS network throughout the City by 2021. FrontierNerizon later decided to advance the installation of a fiber network within the City with the intent of completing the system in 2009. This action made it less likely that the City could penetrate the consumer market. CTAC believes Frontier moved up its schedule as a direct result of Edmonds proposing its own network. The City of Edmonds is currently using the fiber optic network for its internal use and is already enjoying infrastructure flexibility and cost savings. In addition to internal savings, he, EDC, and CTAC are looking for targets of opportunity. As those targets are identified, a cost/benefit analysis will be presented to the Council. The current target market is PEG, other governmental entities, private sector businesses and educational entities as well as healthcare providers. Mr. Hines reviewed the project financials, explaining since 2006, the City has spent approximately $492,022 to activate the network, internal City utilization, and preparing for offering services to other entities. He provided a description and expenditures for supplies, small equipment, professional services, Edmonds City Council Approved Minutes August 24, 2010 Page 7 communications, rental and lease, repair and maintenance, miscellaneous equipment. Additional expenditures include pole rental and consortium dues, ISP services and Cisco maintenance of $16,352 /year. There are also recurring savings and revenues from replacement of the City's two T -1 lines, reduced transportation and reduced jail days due to video arraignment, and one customer, NetRiver that results in annual savings of $97,428 or a net savings of approximately $81,000 /year. Mr. Hines explained fiber optics allows the City to recoup costs in their totality by 2015 and provides a positive cashflow in future years. Any additional targets of opportunity will be secured via an Interlocal Agreement that will be reviewed and approved by the City Council. He advised it was unlikely that targets of opportunity that did not provide a positive cashflow would be presented to the Council. Councilmember Petso asked how far the effort could proceed before it would be necessary to add City employees? Mr. Hines answered the program was not at that point yet, the opportunities are not very numerous because FrontierNerizon has taken the bulk of the market share. The focus will be small targets of opportunity from educational institutions and private sector business who do not fit FrontierNerizon's customer profile. If the City took on 30 -40 new customers, it may be necessary to add employees; he did not anticipate that happening at this time. Councilmember Petso pointed out some customers, SnoCom, Snohomish County and Lynnwood, were not providing any revenue. Mr. Hines advised those entities are partners; what the City does not receive in cash it may receive in services or other mutual benefits. CIO Carl Nelson explained the City uses their services or they use the City's services and via those savings they are a customer. He continues to seek benefits from those partnerships and in the future there may be an opportunity to sell them service. He has been approached by entities interested in fiber when they renew their internet provider contract. Councilmember Buckshnis asked why the three entities are not shown as benefits in the revenue factor. Mr. Hines responded only quantifiable revenues /savings were included in the financials; it is difficult to quantify a mutually beneficial relationship. Councilmember Plunkett recalled approximately two years ago the previous Finance Director posted $104,000 to the fiber account that some thought should have been posted to Information Services and therefore fiber is burdened with an additional $104,000 in expenses. Mr. Hines explained there was a difference of opinion on CTAC; there were some who felt that the assets that fiber and the City shared could be separated out to Information Services and to fiber. Separating the amounts would lower the $492,000; he preferred to take a more conservative approach by overshooting the costs rather than undershooting the costs and causing suspicion. The former Director booked that entry; it appeared just; he was comfortable with it, and it has been audited. Councilmember Wilson commented the Transportation Benefit District (TBD) was created by the City Council, a new government without its own staff, who approved placing an increase on the ballot. Last year the Council voted to move forward with a property tax levy and later decided not to pursue it. In this case, for the past five years the Council has asked for a proposal to expand the fiber. He referred to language in the resolution, "WHEREAS such action on the part of the City has the potential to develop significant revenue for the City of Edmonds" asking how the Council could get to an actionable proposal that could be taken to the voters? He recalled when he first joined the Council, Mr. Jenness provided this same information to him. Mr. Hines responded CTAC was not ready to make a proposal to the Council until they can prove fiber optics works in a business sense. While they have taken small steps to get customers and work with other entities to utilize the asset, the next step is to identify additional customers to whom the City provides a service and they provide revenue. Once a clear pattern of customers can be established, a proposal could be made to capitalize on it. Edmonds City Council Approved Minutes August 24, 2010 Page 8 Councilmember Wilson commented it may have been the general request of Council to reach that point before making a proposal to capitalize the project, that would not be his ask of CTAC now. Although he supported the proposed resolution which directed CTAC to continue their current efforts, he wanted to do more. He suggested rather than CTAC identifying 10 additional customers, they explore a range of business models such as being a wholesale provider, providing residential service, etc. and then allow the Council to make a decision regarding capitalization, return on investment, etc. He commented several Councilmembers are interested in taking a proposal to the voters to capitalize on CTAC's efforts. Councilmember Plunkett commented although it may seem nothing had happened in two years, in actuality, a lot had happened, most importantly the Superior Court ruling. During that same period, the worst economic conditions have occurred which has slowed the acquisition of PEG accounts. He encouraged the Council to reaffirm continued development of fiber optic opportunities as a source of City revenue. Councilmember Wilson agreed the court case limited the ability to proceed; pointing out Seattle is using Edmonds' court case to move forward. Their Council and Mayor are supportive of pursuing fiber. He questioned how Edmonds could proceed similarly, noting it may be necessary to identify funds for staff. He urged CTAC and information technology and finance staff to help the Council understand what needed to be done to put a funding proposal before the voters in November 2011. COUNCILMEMBER BUCKSHNIS MOVED, SECONDED BY COUNCIL PRESIDENT BERNHEIM, TO PASS RESOLUTION NO. 1234, EXPRESSING THE COUNCIL'S SUPPORT OF CONTINUED DEVELOPMENT OF FIBER OPTIC OPPORTUNITIES AS A SOURCE OF CITY REVENUE. .. i . V OWN y go I W.110 11511011 1 1 COUNCILMEMBER PLUNKETT MOVED, SECONDED BY COUNCIL PRESIDENT BERNHEIM, TO AMEND THE RESOLUTION BY REPLACING "ENTERING INTO" IN THE PARAGRAPH THAT BEGINS, "NOW THEREFORE..." "WITH CONSIDERATION OF." THE VOTE ON THE AMENDMENT CARRIED UNANIMOUSLY. M-91001011 I W 105 '' R.111 W 16VAMMI 1 Councilmember Peterson commented the way he read paragraphs 2 and 3 was contracts with a net cost would not be presented to Council. He questioned if the Council wanted to review all proposed contracts regardless of the net cost/benefit. Councilmember Plunkett asked if the Council wanted an opportunity to review all targets of opportunity. Mr. Hines has stated CTAC would not present a target unless it was it had net revenue. Councilmember Fraley- Monillas was comfortable with the amendment, noting information regarding targets of opportunity would be provided to the Council quarterly. Councilmember Wilson anticipated City Attorney Scott Snyder would say the Council could not waive or abrogate its contractual responsibility; any contract would need Council approval. He preferred all targets of opportunity be presented to the Council and allow the Council to consider them case -by -case. For Edmonds City Council Approved Minutes August 24, 2010 Page 9 instance the City already has a contract in place with SnoCom that provides no revenue which would be in violation of this resolution. He planned to propose an amendment to delete paragraphs 2 and 3. Council President Bernheim noted the goal was for new customers not to result in a net cost to the City. THE VOTE ON THE AMENDMENT CARRIED (6 -1), COUNCILMEMBER PETERSON VOTING NO. COUNCILMEMBER WILSON MOVED, SECONDED BY COUNCILMEMBER FRALEY- MONILLAS, TO AMEND THE RESOLUTION BY STRIKING PARAGRAPHS 2 AND 3. Councilmember Wilson explained defining net cost can be a policy question and his intent was not to have staff make policy decisions. He preferred staff present anything that made sense to the Council. He did not want to preclude existing contracts such as with SnoCom and Snohomish County because they did not comply with the resolution. He suggested replacing paragraphs 2 and 3 with a statement such as it is the policy of the City of Edmonds to review any worthwhile, legitimate contract with any provider that would serve the interest of the community. He summarized he did not want to limit the proposals that staff could present to the Council. Councilmember Peterson expressed his support for the amendment, commenting there may be opportunities to partner with entities such as the Sno -Isle Library. Even if there were some upfront costs, there may be an overall benefit. He preferred to provide staff the flexibility of presenting all options to the Council. TAE TOTE 011�--�—AITIEIIIJITIEIIT CARRIED (6-1), C0411CILMEIRBER PLIVIAxTT VOTING NO. COUNCILMEMBER WILSON MOVED, SECONDED BY COUNCILMEMBER PETERSON, TO INSERT A STATEMENT IN THE RESOLUTION "IT WILL BE THE POLICY OF THE CITY OF EDMONDS TO REVIEW ANY LEGITIMATE CONTRACT OR OPPORTUNITY THAT SERVES THE INTEREST OF THE CITIZENRY OF EDMONDS." Council President Bernheim suggested the language was unnecessary, the direction from the Council was for CTAC and staff to continue exploring opportunities and to report to the Council. He was comfortable with providing no parameters, recognizing the great work CTAC has done so far. Councilmember Peterson voiced his support for the amendment, pointing out although the present Council's understanding is as Council President Bernheim stated, this would provide guidance to future staff and Council. THE VOTE ON THE AMENDMENT CARRIED (6 -1), COUNCIL PRESIDENT BERNHEIM VOTING NO. COUNCILMEMBER WILSON MOVED TO ADD AS PARAGRAPH 6 IN THE RESOLUTION, "THE ECONOMIC DEVELOPMENT COMMISSION AND THE CITIZENS TECHNOLOGY ADVISORY COMMITTEE WORKING TOGETHER WILL BRING THE COUNCIL A PLAN FOR THE CAPITALIZATION OF A COUNCIL APPROVED BUSINESS STRATEGY BY A VOTE OF THE PUBLIC BY NOVEMBER 2011. . MOTION DIED FOR LACK OF A SECOND. Councilmember Petso supported moving forward but suggested as opportunities are pursued equity be kept in mind. With regard to land use, she assumed any issues would be presented to the Council. She Edmonds City Council Approved Minutes August 24, 2010 Page 10 envisioned it would be less expensive to string cable above ground rather than underground. She wanted to avoid any view blockage as a result of overhead fiber optic cable. Council President Bernheim thanked everyone involved in bringing the fiber project to this stage. He recalled attending a Council meeting as a citizen when the CTAC committee was originally formed. He was very satisfied with the way this economic development opportunity was progressing. Councilmember Wilson asked whether the resolution limited the City from reviewing other business models. Councilmember Plunkett answered no, assuring the members of CTAC and EDC wanted to consider all possibilities whether it was a different model, the existing model, targets of opportunity, etc. Mr. Hines assured they were open to any and all business models that result in a positive cash flow. The targets of opportunity currently being considered lend themselves to a costibenefit model; other targets may lend themselves to other models. They will be as flexible as is necessary. Councilmember Wilson responded it was his intent to move forward as quickly as possible. Councilmember Wilson asked whether it was necessary to identify tasks CTAC would undertake and what tasks EDC would undertake. Councilmember Plunkett responded a collaborative process has enabled the project to reach this point. 19soI&IIIIIMUNINII10204 Ell 1610► tell Y[1101yMV\ /130/111 DIIZV11199101IIII►/ \►11► U11MI/1•� 10. DISCUSSION REGARDING PROFESSIONAL SERVICES CONTRACTS. Council President Bernheim suggested as part of the budget process the City ask qualified providers of legal services to bid on the City's professional services work. The City's Hearing Examiner contract expires at the end of the year and although there have been no issues with the work performance, there may be opportunities for modest savings. With regard to legal services, Finance Director Lorenzo Hines provided him a report that indicated legal expenses January 2009 through today are in excess of $1 million. Councilmember Petso suggested the City also seek bids for actuarial services. Mayor Cooper questioned whether the City had a contract for actuarial services and whether it was up for renewal. The contracts Council President Bernheim has proposed the Council seek bids on are due to expire at the end of this year. The option is to renew the contract or seeks bids. It was his understanding the only contracts expiring this year are the Public Defender, Hearing Examiner and the City Attorney. Councilmember Petso offered to research the actuarial contract. Councilmember Peterson referred to a letter the City received today from Toweill Rice Taylor, the City's current Hearing Examiner, advising they would not be seeking renewal of their professional services agreement. With regard to soliciting requests for proposals (RFP) for legal services, he acknowledged the City's legal fees have increased in recent years and he suggested comparing the City's costs with other cities' costs. One of the reasons for increased legal fees is the increase in public records requests which is epidemic statewide. Before embarking on a time consuming RFP process, he suggested investigating whether other cities were experiencing increased legal fees. If everyone's costs are increasing for the same reasons, it was doubtful the City would realize a significant cost savings. If there were issues regarding quality of service, that was a different discussion. Councilmember Buckshnis advised the Citizen Levy Committee (CLC) has requested information on all the City's consultants. Council President Bernheim, Mayor Cooper, Mr. Clifton, Debi Humann and she attended a seminar this week and talked to a number of cities. Renton recently made a change from a contract City Attorney to an in -house attorney. She offered to contact Renton regarding a cost Edmonds City Council Approved Minutes August 24, 2010 Page 11 comparison. She commented another consideration is the longevity that the City's current City Attorney Scott Snyder provides. He provided the CLC pros and cons of a contract City attorney and an in -house attorney. He also provided the CLC information regarding moving emails to the web in response to a new law that will allow public requests to be directed to a website as long as the website was identified. She noted this would save paper although it would not save staff time. Councilmember Wilson advised it was his understanding that actuary services were contracted for on a project by project basis. Those projects were relatively rare, occurring only once every couple years. Councilmember Wilson commented Edmonds uses Mr. Snyder far more than other cities use their City Attorney. As a consultant working with various cities, in his experience cities are typically very regimented in the use of their City Attorney. Edmonds has a policy of the City Attorney only attending Council meetings the first and third Tuesdays but he often attends other meetings and is has become a central resource for the Council. He noted although the Council sees Mr. Snyder, the City gets the benefit of his entire firm. If the Council replaced Mr. Snyder with one attorney, there would be a significant reduction in servicing the City's needs. If the City hired an in -house attorney, it was likely 3 -5 additional support staff would be necessary. Councilmember Fraley - Monillas suggested researching an in -house attorney. Other groups with budgets similar to the City's have moved from a contract attorney to an in -house attorney. Advantages of an in- house attorney include that he/she is present in City Hall and his /her schedule is established in accordance with the City's needs. She agreed in addition to an in -house attorney, the City would need to hire a paralegal and possibly a part -time assistant. The other groups who have changed to an in -house attorney found it provided better coverage of legal representation. Mayor Cooper explained the $1 million Council President Bernheim referred to is all the legal costs, not just Ogden Murphy Wallace. It includes litigation costs that Mr. Weed and other attorneys have charged the City. Finance Director Lorenzo Hines advised the $1,031,000 was all costs associated with the City Attorney function, both retainer and litigation fees. It did not include costs for the prosecuting or defense attorneys. Mayor Cooper observed there have been two options discussed, 1) a RFP for a City Attorney, and 2) researching hiring an in -house City Attorney rather than a contract City Attorney. He asked Council President Bernheim clarify his request. Council President Bernheim responded his request was a RFP for legal services in the manner in which they are currently provided. He was not interested in restructuring the way legal services are provided at this time. He was satisfied there were many qualified firms and lawyers who could provide the same or better quality legal advice for the same or better price. Councilmember Peterson suggested if there was some uncertainty regarding whether the Council wanted to have a contract versus an in -house attorney, qualified law firms may not apply to a RFP. He asked the timeline for a RFP and whether there was time to have a further discussion regarding the City Attorney. Mayor Cooper answered the Council needed to provide direction on how to proceed at one of their September meetings in order to provide sufficient time for a RFP, interview and selection process and to have an attorney under contract by January 1, 2011. Councilmember Peterson reiterated his request to research cost increases other cities are experiencing to determine whether Edmonds legal costs were out of whack before directing staff to proceed with a RFP process. Councilmember Fraley - Monillas asked whether Councilmember Peterson was interested in a comparison of fees from cities with in -house and contract attorneys. Councilmember Peterson answered his interest Edmonds City Council Approved Minutes August 24, 2010 Page 12 was in determining whether other cities' legal costs have increased whether their attorney services are provided in -house or via a contract. He anticipated legal costs were increasing due to increased public records requests regardless of whether a city had an in -house or contract attorney. Councilmember Fraley- Monillas was interested in researching what other cities paid for in -house and contract attorneys. COUNCIL PRESIDENT BERNHEIM MOVED, SECONDED BY COUNCILMEMBER PETSO, THAT THE CITY ISSUE AN RFQ FOR CITY ATTORNEY SERVICES AND HEARING EXAMINER SERVICES WITH ALL DELIBERATE SPEED. Councilmember Plunkett commented he had a great deal of faith and trust in Mr. Snyder but in these economic times he was interested in investigating what other possibilities were available and the cost. Councilmember Wilson suggested rather than directing staff to do a great deal of work on in -house counsel versus a contract attorney, consideration be given to hiring a legal staffing consultant to determine how an in -house attorney's office would be structured based on the City's case load. He was uncertain whether the City's limited Human Resources staff had the capacity to provide that information. If the Council was serious about changing the form of its legal services, the City should use a labor negotiator separate from Ogden Murphy Wallace as he feared it could be complicated if labor negotiations were not concluded by December 31. He suggested when researching the cost of an in -house attorney, the City determine the true cost including medical benefits, and union contracts for support staff now and in the future. Councilmember Plunkett asked whether AWC or Municipal Research Services Center could provide the information Councilmember Wilson requested. Mayor Cooper advised Human Resources staff has done some preliminary work on that matter at his request and could provide the information to the Council at a future meeting. Councilmember Wilson supported the request to research other cities' costs. His request was to determine the cost of an in -house legal department to accomplish Edmonds' workload. He emphasized other cities have different work loads; researching other cities costs for in -house staff would be informative but not necessarily comparable to Edmonds. He reiterated his suggestion to consider hiring a legal staffing consultant. Mayor Cooper suggested the Council keep the two items separate. The motion is to seek bids for a City Attorney. If the Council decides during the budget process or some other time to do a study or consider an in -house legal department, there will be a transition period and the City likely would need a contract City Attorney at least through 2011 even if a decision was made to pursue an in -house attorney. THE VOTE ON THE MOTION CARRIED (6 -1), COUNCILMEMBER PETERSON VOTING NO. 6. 2010 SECOND QUARTER BUDGET REPORT. Finance Director Lorenzo Hines referred to the 2010 second quarter report, explaining the City's revenue position was approximately 55% of budget and expenditures were approximately 48% of budget. The second quarter budget report contains two pending budget amendments that were included because they were material and needed to be reflected in the budget. The first was an expenditure authority amendment regarding a Council action that occurred earlier this year. The Council decided the proceeds from the sale of fire assets would be moved out of the General Fund into a special reserve fund, the Public Safety Reserve. Approximately $600,000 was moved into the Public Safety Reserve. The Council also made a Edmonds City Council Approved Minutes August 24, 2010 Page 13 decision to move $100,000 to the Facilities Fund. The transfer was made; however, expenditure authority needed to be granted, basically a technicality. In completing the Fire Department transactions, it was discovered that there was approximately $700,000 in the Equipment Rental Fund set aside for fire vehicles and one fire engine. Since the City did not have a need for those funds in the Equipment Rental Fund, a decision was made to move those funds to the General Fund as the funds were originally the result of General Fund contributions. That adjustment was also included in the second quarter budget amendment. Both adjustments are described on page 2 of the second quarter budget report. Councilmember Petso posed the following questions: • EMS transport fees of approximately $700,000 were budgeted. Page S of the report indicates the City has received only $184,000. Is that revenue stream expected to recover? Mr. Hines advised that determination would be made in the latter half of the year. It appears that EMS transport fees are not being received as budgeted. He offered to research and if necessary, reduce the budgeted amount via the next budget amendment in late November, early December. • $700,000 was budgeted to be received from the Transportation Benefit District fee. The report indicates the City has received $271,000. Mr. Hines offered to research. • She was told TBD funds were not placed in the General Fund, page 5 identifies them as a General Fund revenue source. Mr. Hines advised the funds are transferred to funds where they can be accessed by Streets and Public Works. • Where is that transfer in the second quarter report? Mr. Hines advised the transfer had not yet been made. • What is the Interfund Reimbursement — contract services for $1.3 million. Mr. Hines advised he is researching that item. • Sale of fixed assets (page 6), $7.7 million are anticipated to be sold. Accountant Debra Sharp advised that was the original sale of the Fire Department rolling stock. The actual amount was $1.4 million which was part of the amendment. She explained $1.7 million was budgeted; the City received $1.4 million. The budget amendment reduces the $1.7 million to $1.4 million. As part of the accounting transactions to remove the assets, the sale in the 511 (Equipment Rental Fund) must also be shown. Therefore it is moved from the General Fund to the Equipment Fund and then the funds are transferred again via an interfund transfer. • If the City received $1.4 million for selling the rolling stock; why was that amount not placed in the Public Safety Reserve Fund? Mr. Hines explained the $1.4 million was reduced by approximately $800,000 in firefighter vacation. • Three interfund transfers on page 7 are not identified. She suggested in the future the fund to which the transfer is made be included. Mr. Hines advised the interfund transfer of $25,000 was from Fund 113, the $25,086 transfer was from Fund 121 and the $54,000 transfer was from Fund 411. He agreed to include that information in future quarterly reports. • Page 8 includes a list of funds but not all funds are listed such as the Emergency Financial Reserve Fund, the Council Contingency Fund, the Sister Cities Fund. She requested all the funds be included in future reports. Mr. Hines answered historically only selected funds were included in the quarterly report. He agreed to expand the list to include all 26 funds. • When funds are allocated to a certain fund, isn't administration constrained to spending within the limit of the allocation? Mr. Hines answered spending must stay within the limit Council sets. If staff finds that authority will be exceeded, a budget amendment is proposed explaining the reason the spending authority will be exceeded. • In REET 125, $1.3 million has been spent when only $1.1 million was appropriated. She inquired how those funds were spent and why it was not presented to the Council. Mr. Hines Edmonds City Council Approved Minutes August 24, 2010 Page 14 explained these were costs from a Parks construction project that was originally to have occurred in 2009. The expenditure did not occur in 2009 and was moved into 2010. This issue has been brought to the Parks & Recreation Director's attention. An amendment will be made in the next mid -year amendment. He offered to forward the Council an email describing the project. Councilmember Wilson expressed concern that the expenditures in Fund 125 did not match the appropriation, noting it was incumbent on staff to highlight that information in the Council packet so that Council did not have to ask so many questions at the Council meeting. He found the expenditure in excess of the allocation in Fund 125 egregious. Councilmember Wilson recalled the Council's intent when moving the funds remaining after the sale of assets was that they be placed in a separate fund and not in the Public Safety Reserve Fund. Mr. Hines explained the $600,000 from the fire proceeds were placed in a separate fund, the Public Safety Reserve Fund. There is a $1.9 million balance in the City's Emergency Reserve Fund which is a separate fund. Councilmember Wilson suggested renaming the Public Safety Reserve Fund to avoid confusion. With regard to transport fees, Councilmember Wilson expressed concern that Fire District 1 may not be accurately charging or billing the transport fee. He requested staff research whether Fire District 1 was accurately collecting those fees. Councilmember Buckshnis recalled at this time last year, the revenue from transport fees was $217,000 or 30 %, similar to this year. At fiscal year end 2009, the City received $682,258; the budget was $700,000. With regard to TBD receipts, Councilmember Wilson explained the TBD is a separate governmental entity that does not actually employ any staff or provide any services; the TBD contracts with the City to collect the fees and to do the work. The funds collected are deposited into the General Fund and transferred to the TBD. It may be appropriate to revise the Interlocal Agreement to identify a different fund to receive those fees. Councilmember Wilson asked for clarification of the sale of fixed assets on page 6. Mr. Hines explained the City initially anticipated receiving $1.7 million; within that amount was approximately $350,000 in aid cars. As a result of negotiations between the City and Fire District 1 it was decided Fire District 1 would pay for the aid cars and the associated sales tax. As a result the City received $1.4 million versus $1.7 million. The City also paid out approximately $786,000 in firefighters vacation. Councilmember Wilson questioned the $974,844 for sale of fixed assets as of June 30, 2010. Mr. Hines anticipated there were accounting mechanisms that created the $974,844 figure. The numbers will change in the next quarterly report as Fire District 1 transactions are completed. Councilmember Wilson asked whether the $700,000 in the Equipment Rental Fund was reflected in the 511 transfer on page 11. Mr. Hines answered it was. Councilmember Wilson concurred with Councilmember Petso's request to expand the list of funds within the General Fund. Councilmember Wilson commented he did not have a high degree of confidence that today's numbers with regard to Fire District 1 exactly reflected the numbers the Council discussed last September /October. He requested Mr. Hines provide a full report to the Council within the next few months comparing the costs, savings, etc. that were proposed and the actual numbers. For example he recalled the Council was informed by Fire District 1's Fire Chief in his July 1, 2009 presentation that SnoCom would be a savings to the City. In reality the City will continue to be liable for those fees. Edmonds City Council Approved Minutes August 24, 2010 Page 15 Councilmember Buckshnis posed the following questions /comments: • At the end of July staff was still settling the 2009 Fire District I transaction. Will the CAFR need to be revised? Mr. Hines answered no, all the Fire District 1 transactions occurred during fiscal year 2010; the contract took effect January 1, 2010. • The recently adopted financial policies will require reporting of fund balances and for all funds to balance. • The executive summary current forecast on the website for January 25, 2010 and June 5, 2010 uses January 20, 2010 actuals. She requested these be updated when the June information is available. Mr. Hines responded the 2009 column has been updated to reflect yearend actuals. The report will be released to the Council following review by Mayor Cooper and hopefully to the Citizen Levy Committee on Thursday. 7. 2009 -2010 MID -YEAR BUDGET ADJUSTMENT - 08/24/2010 Finance Director Lorenzo Hines explained the mid -year budget adjustment was a housekeeping issue; the majority of the adjustments were to bring forward fund balances from 2009 into 2010. There are also transactions to accommodate the sale of the Fire Department in 2009 and transactions to reflect activities that occurred in 2009 that are brought forward into 2010. There were two incidents in 2009 where the expenditure authority was exceeded. The State Auditor indicated because this is a biennial budget the expenditure authority could be addressed in the next year. Mr. Hines reviewed the General Fund summary: Beginning Fund Balance Increase (Decrease) 902,405 Increases in revenue that increase the ending fund balance: Fire Asset allocation from Fund 511 464,693 TBD 2010 Transportation Benefit District Revenue 580,000 Utility Utility Tax Increases from 2009 726,000 Fire Additional Fire District 1 savings — amended during the mid- biennium 12/15/09 145,230 Total revenues that increase ending fund balance 1,915,923 Decreased in revenue that decrease ending fund balance Police Loss of Mountlake Terrace Animal Control Contract 3( 5,820) Total revenues that decrease ending fund balance (35,820) Decrease in ex enditures that increase ending fund balance: Multiple depts. 2010 B -Fund contribution eliminated during 2009 budget review (336,393) Police March 13, 2009 police services cuts made for 2010 (119,128) Total expenditures that increase ending fund balance (455,521) Increase in expenditures that decrease ending fund balance: City Clerk Temporary assistance due to extensive public records requests 10,588 Fire Department 2009 fire costs paid in first part of 2010 13,898 Fire Department Fire contract adjustment — amended during mid- biennium 12/15/2009 98,449 Utility Hydrant maintenance 340,000 Edmonds City Council Approved Minutes August 24, 2010 Page 16 Non - departmental Transfer to Public Safety Reserve Fund & Facilities Maintenance Fund 700,000 Community Services Carry forward of Verizon/Frontier unspent grant money 8,514 Total expenditures that decrease ending fund balance 1,171,449 Revenues & expenditures that do not effect ending fund balance due to offsetting revenues or expenditures: Non - departmental Eliminated SnoCom Director Services in 2009 (179,022) Public Works Administration N. Miller payout 52,000 Mayor L. Carl payout 16,800 Community Services HUD EDI pass through grant to PFD 91,447 Police Equip purchased w/2009 Recovery Act Edward Byrne Memorial Justice Asst Grant 12,876 Multiple depts. Energy Efficiency Conservation Block Grant (EECBG) Purchases and Dept of Energy 76,204 Non-departmental Allocate cable utility tax revenue from franchise revenue 460,000 530,305 Ending Fund Balance Increase (Decrease) 2,066,580 Councilmember Petso referred to Mr. Hines' indication that some items had been addressed in prior budget amendments. Mr. Hines explained a number of amendments were made in 2009 that also needed to be reflected in amendments in 2010. Councilmember Petso clarified all the above amendments were 2010 amendments. Mr. Hines agreed. Councilmember Buckshnis suggested better labeling, descriptions and page numbers for the amendments as she was unable to trace the amendments to the quarterly report. She observed all the funds were out of balance and needed to be brought into balance with actuals. Mr. Hines explained the City just finalized its 2009 financial statements and the numbers are now accurate and agreed to by the State Auditor. He was now comfortable moving those numbers into the individual funds to illustrate the state of the funds in 2010. He was not comfortable doing so until the CAFR (Comprehensive Annual Finance Report) had been released. Councilmember Buckshnis offered to illustrate how the General Fund balances to the CAFR. Mr. Hines advised the CAFR was a point in time as of December 31, 2009. Council President Bernheim suggested at the next Finance Committee meeting, September 14 or at a special Finance Committee meeting, Mr. Hines, the Finance Committee and Mayor Cooper discuss the mid -year budget adjustment and return it to the Council at the next possible opportunity. Mr. Hines explained he is in the process of developing a 2011 budget; he cannot create the 2011 budget until he knows what 2010 looks like which requires adoption of the mid -year budget adjustment. The Council has scheduled a budget workshop on Tuesday, August 31; the adjustment needs to be finalized in order for the budget workshop to be meaningful. A special Finance Committee meeting was scheduled for Monday, August 30 at a time to be determined. It was agreed to notice the meeting so that all Councilmembers could attend. City Clerk Sandy Chase advised a special meeting required 24 hours notice. Councilmember Peterson suggested Councilmembers email questions to the Finance Director in advance of the Finance Committee meeting. Councilmember Wilson asked how the $902,405 beginning balance adjustment was determined. Mr. Hines offered to provide Councilmember Wilson a reconciliation as it was complicated. Councilmember Edmonds City Council Approved Minutes August 24, 2010 Page 17 Wilson asked why a $900,000 adjustment was necessary. Mr. Hines reiterated many of the adjustments were reflected in the 2010 budget were things that happened in 2009 and were reflected in the 2009 budget amendment. COUNCILMEMBER WILSON MOVED, SECONDED BY PETERSON, TO EXTEND THE MEETING 30 MINUTES. MOTION CARRIED UNANIMOUSLY. Mr. Hines continued his explanation, the 2009 -2010 budget is a biennial budget cycle; there were things built into the 2009 budget in 2008 and things that happened once the budget is enacted. In 2009 a number of things occurred that must also be reflected in 2010. Things that happened in 2009 do not automatically carry over into 2010. The 2010 budget was originally developed in 2008. The amendments make 2010 more relevant and current. Councilmember Wilson observed there were amendments made in 2009 that made 2010 more current. Councilmember Wilson observed the amendments made in 2009 carry over into 2010. Mr. Hines explained the mid -year adjustment is the vehicle by which they carry over into 2010. Councilmember Wilson suggested a simple narrative to help him understand the $902,405 beginning fund balance. Councilmember Peterson asked whether the $902,405 was primarily budget cuts made in 2009. Mr. Hines answered the cuts played a role in that amount. Councilmember Wilson asked whether the budget cuts were reflected in the CAFR. Mr. Hines answered they would have been reflected in the 2009 ending General Fund balance which is being moved forward into 2010. Councilmember Wilson asked whether the $902,405 reflected increases to the December 31 balance or everything from January 1, 2009 to June 30, 2010. Mr. Hines answered the December 31 balance reflects everything that occurred January 1 through December 31, 2009, the culmination of everything in and out of the General Fund during the year and $902,405 is the residual of those transactions. Mayor Cooper requested Councilmembers email additional questions to Mr. Hines prior to the August 30 Finance Committee meeting. Councilmember Wilson commented the discussions at Council meetings were very helpful to him in working through the materials. He cautioned he may not email a lot of questions but was likely to have additional questions when the Council next discussed the mid -year budget adjustment. 11�010016)1n.1 191911' A1. Y01►[ e11111 61111W0311041111151000T01\ 11112011 D1 By110 [!'L`1 Councilmember Plunkett distributed CTAC's recommendation to the Council on computer use in Council Chambers. Councilmember Peterson reported the Mayor's Climate Protection Committee met early this month and is moving forward with actionable items, moving from the theoretical stage to an action oriented stage. Councilmember Buckshnis reported the SeaShore Transportation Forum discussed the formation of a TBD. Edmonds and Lake Forest Park have formed TBDs and many of the other members are interested in the process. Next, she reported on the Economic Development Commission, advising two of the seven recommendations were reviewed by the Council tonight. She plans to present to the Council a request to extend the EDC another 18 months. The Citizen Levy Committee held its third meeting. The members have formed subcommittees to discuss specific issues. Councilmember Fraley- Monillas reported on a discussion at a recent Snohomish County Public Health District policy committee meeting regarding prioritizing services due to funding. Edmonds City Council Approved Minutes August 24, 2010 Page 18 12. MAYOR'S COMMENTS In response to the concern raised last week regarding the 911 call at Engels Pub, Mayor Cooper advised Assistant Chief Lawless sent Councilmembers an email describing the situation. Police officers were flagged by a bystander; the police used their tazer on a gentleman and the aid car was called. The Fire Department's response time was 4.5 minutes, well within average response times. The Fire Department remained in a staging area for another approximately two minutes because the Police Department felt the scene was not secure. When aid was allowed onto the scene, the individual tried to fight the medics. Mayor Cooper indicated he will forward the Council a much more detailed report from Fire District 1 Chief Widdis that shows actual Police and Fire response times from the dispatch center that illustrates the response times were well within acceptable levels and that they responded in accordance with their training. He thanked the Police and Fire Departments for their professionalism in handling a very difficult situation. Mayor Cooper advised the email to submit budget suggestions is now available: bud eg tsuggestions @ci.edmonds.wa.us. Approximately 10 -12 suggestions have been submitted since the press release was issued. With regard to Ms. Shippen's request regarding the WSF budget, Mayor Cooper pointed out the State legislature writes the transportation budget. The budget language in the long range plan was developed by WSF, not the City. Mr. Clifton has inquired with WSF and their consistent response is that the $26 million is for a future project. If the Council feels strongly about that language, he urged them to include it in the City's legislative agenda. Mayor Cooper reported he received a letter from the Chair of the Fire District 1 Commissioners, Commissioner Kenny, summarizing the agreement to move the 1938 Ford fire engine back into the fire station on a temporary basis until a long term solution can be worked out. Mayor Cooper planned to convene a group of stakeholders to discuss a long term solution. 13. COUNCIL COMMENTS Councilmember Wilson explained he had been a candidate for the Snohomish County Council position vacated by Mayor Cooper. Today the Snohomish County Council chose Lynnwood Councilmember Stephanie Wright to fill that position. Councilmember Buckshnis reported on the AWC budget conference, commenting it was interesting to learn about what other cities have done such as reducing overtime, reducing overall budget by 5 %, looking at ways to renegotiate contracts with City contractors, looking at leasing versus buying, scaling back, doing cost/benefit analyses, developing strategies where an employee is rewarded a day off for a good solution, and idling excess parts or supplies. Councilmember Fraley- Monillas congratulated Stephanie Wright on her appointment to the Snohomish County Council. She reported on the City baseball game that Councilmember Petso and she participated in; Edmonds beat Mountlake Terrace 15 -3. Councilmember Petso suggested the City seek clarification from WSF regarding the $26 million project, whether it is an improvement at the existing location or at an alternate location. She inquired about the mechanism for clarifying the intent with the State. Edmonds City Council Approved Minutes August 24, 2010 Page 19 With regard to the budget amendments and the transfer of funds in the 511 to the General Fund of funds intended to replace fire trucks, Councilmember Petso suggested the Council consider whether they wished to have those funds set aside in the same way that the proceeds of the sale of the fire trucks were. Councilmember Peterson congratulated the Edmonds Chamber of Commerce on another successful Taste of Edmonds and the Dave Stern Memorial Golf Classic. He announced the upcoming car show on Sunday, September 12. Council President Bernheim thanked Sustainable Edmonds for the Save Energy Now program, noting the smaller savings at the household level are the most important and result in the greatest aggregate savings. He urged other businesses to sign up. Council President Bernheim referred to the murals being installed downtown, another example of a small thing at a relatively low cost that adds a lot of value. He applauded the mural group for their efforts. He relayed comments from recent visitors regarding the beauty of the City's parks and flowers. He thanked Mayor Cooper for reaching an agreement with Fire District 1 on an interim resolution for the 1938 fire engine. He remarked it was nice that the Council was having discussions and getting along. 14. ADJOURN With no further business, the Council meeting was adjourned at 10:23 p.m. Edmonds City Council Approved Minutes August 24, 2010 Page 20