Title
ACCEPT: Finance Committee Meeting Highlights of May 4, 2012
Body
CITY OF SAN LEANDRO
CITY COUNCIL FINANCE COMMITTEE
May 4, 2012
8:15am - 9:45am
San Leandro City Hall
835 East 14th Street
San Leandro, California
(Sister Cities Gallery)
Committee Members: Mayor Cassidy, Councilmember Cutter, Councilmember Prola
City Staff Present: Assistant City Manager Marshall, Finance Director Baum, Interim Finance Director O'Leary, Public Works Director Bakaldin, Deputy Finance Director Rodriguez, Budget and Compliance Manager Perini, Sr. Accountant Galvin, Administrative Assistant III Perez
Public Present: Dave Johnson
The meeting was called to order at 8:15 a.m.
1. Follow-Up Discussion Regarding Recruitment of Members of the Citizen Oversight Committee Related to Measure Z
Interim Finance Director O'Leary reported to the Finance Committee that he is working with the City Clerk to develop the process, letters, applications, and Press Release for the Oversight Committee based on the approved resolution. Notices will be posted on the City's website and the San Leandro Times to alert any other interested party that is not on the mail out list. Mr. O'Leary stated that it is his intention to get the process started prior to his departure from the City on May 25, 2012. The deadline for submitting applications will be in June. Mr. O'Leary asked how the Finance Committee would like to conduct the interview process. Mayor Cassidy stated that he would like a summary of the potential candidates by July and that the Finance Committee will make the decision on the final candidate list to present to the entire City Council by July 16, 2012.
2. Continued Discussion Regarding Budget Work Session Follow-Up and Development of 2012-13 City Budget to be Distributed May 11, 2012
Mr. O'Leary reported to the Finance Committee that staff will present the City Manager's Proposed Budget at the May 21st City Council meeting and will hold the Public Hearing on June 4, 2012. Mayor Cassidy inquired if the goal is to adopt the budget at the June 4th meeting and Mr. O'Leary stated yes. Mayor Cassidy stated that he provided Assistant City Manager Marshall with a copy of the City of San Jose's budget summary and instructed Finance staff to create a similar summary document for the City of San Leandro for the community to assist in understanding municipal finance. The summary should speak of the current fiscal year and describe the future direction. Mayor Cassidy stated that he would like this document after the adoption of the budget and is hoping staff can have a draft available by the end of June.
Councilmember Prola agreed with providing the community with a summary as there is a misconception that all funds can be used and intermingled.
Councilmember Cutter suggested that the Finance Committee provide a format on what information should be included. Mayor Cassidy stated that what will be presented to City Council would be sufficient.
Mr. O'Leary asked the Finance Committee for direction that would assist staff prior to the presentation of the 2012-13 Proposed Budget at the May 21, 2012 City Council meeting. Mr. O'Leary said that City Manager Zapata stated he would like to move $50,000 from the City Manager's contingency account to the "One Time Needs" funds. The Finance Committee discussed potential uses and/or contributions for these funds, including: social services, the need for a Gang Counselor at the middle and high school level. Mayor Cassidy inquired about a Cherry Festival in 2013 and if the possibility is not feasible, perhaps the discussion of having the Cherry Festival should stop. Councilmember Prola suggested speaking with the Downtown Association on taking on the Cherry Festival and perhaps the City can donate some funds. Councilmember Prola also suggested using the $50,000 that the City Manager is providing and splitting it: $30,000 towards the Gang Counselor at the High School and $20,000 to Building Futures. Councilmember Cutter stated that she would like specific details on why Building Futures needs the City's assistance and although agrees there is a need for a Gang Counselor, she does not believe that the City of San Leandro should give money to the School District without getting more information from the Superintendent. The Finance Committee agreed there needs to be further discussion on how the funds should be appropriated.
3. Discussion on Quarterly Financial Report as of March 31, 2012 for the 2011-12 General Fund, Special Revenue Funds, Enterprise Funds, and Internal Service Funds Budgets
Mr. O'Leary stated that at the previous City Council Work Session, the City Council raised the question as to why the Internal Services Funds are so large. Mr. O'Leary explained to the Finance Committee that the need to continue to build the Internal Services Funds (Building Maintenance, Information Technology, and Equipment Maintenance) is that, over the next 5 years, there are repairs and replacements that must be made. These repairs and/or replacements include: repairs to the City's buildings, building HVAC systems, software upgrades, and fleet replacements. Staff recommends leaving the Internal Service Funds as they are. Public Works Director Bakaldin explained to the Finance Committee that currently the Building Maintenance and Equipment Maintenance Funds are inadequate and grossly underfunded. Mayor Cassidy instructed staff to provide a multi-year plan for the Internal Service Funds so that they may be able to analyze properly.
4. Staff Report
· Refinancing Opportunities for Existing City Debt
· Revenue Analysis and Summary, Alameda County Cities
· City Deposits Utilizing Local Community Development Bank
Finance Director Baum spoke to the Finance Committee on the opportunities of refinancing other City debts and inquired if the Finance Committee is interested and, if so, would they like to use the same refinancing team as with the Pension Obligation Bonds for the Public Safety CalPERS Side Fund. The Finance Committee agreed that the financing team of Public Financial Management and Jones Hall continue assisting the City. Mr. Baum stated that in reviewing the City's general fund debts, there is a potential net present value debt service savings of $400,000. Mayor Cassidy stated that he agrees we should look into refinancing the debt however does not want to extend the debt's final maturity.
Mayor Cassidy would like to have a discussion at a future Finance Committee meeting regarding parking rates and the idea of charging for parking at the Marina. Assistant City Manager Marshall stated that currently Engineering and Business Development are working on the City's parking strategy.
At the previous Finance Committee meeting, City Manager Zapata proposed investing funds in the Certificate of Deposit Account Registry Service (CDARS) through one of the local banks. Mr. Baum stated that he has reviewed banks in the city and unfortunately not one participates in the CDARS program. The closest bank to participate is in Oakland. Mayor Cassidy would like staff to continue to research and bring back to the Finance Committee in September. Mayor Cassidy suggested looking at banks in East Oakland as they are closer to the City of San Leandro and therefore may bring the City revenue. Councilmember Prola inquired where the City's money is currently being invested. Mr. Baum stated that $75-80 million is in the Local Agency Investment Fund and US government securities and unfortunately, yields are low and therefore the City is not earning much interest.
Finance Committee would also like to discuss the Revenue Analysis and Summary of Alameda County Cities in further detail at a future meeting
5. Public Comments
None
6. Committee Member Comments
Finance Committee would like to discuss future Finance Committee dates and times at the June 1, 2012 meeting. Councilmember Prola asked staff to provide reports to the Finance Committee sooner to insure time to review.
7. Adjourn
The meeting was adjourned at 9:45 a.m.