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CITY COUNCIL

REGULAR ADJOURNED MEETING MINUTES

DATE OF MEETING: April 20, 2004

TIME OF MEETING: 7:00 P.M.

PLACE OF MEETING: RED BLUFF COUNCIL CHAMBERS, CITY HALL

The agenda for this meeting was posted pursuant to Resolution No. 28-1995

Councilmembers Present: Forrest Flynn, Mayor

Larry Stevens Mayor Pro Tem

Gregg Avilla

Andy Houghton

Russ Frey

Councilmembers Absent: None

Staff Present: Susan Price, City Manager

Richard Crabtree, City Attorney

Gary Antone, Director of Public Works

Charles Hayden, Planning Director

Gloria Shepherd, City Clerk

Margaret Van Warmerdam, Director of Finance

Tessa Pritchard, Human Resources Director

Al Shamblin, Police Chief

Robb Gibbs, Director of Parks and Recreation

J.D. Ellison, Sr. Building Director/Official

Venita Philbrick, City Treasurer

1. Annual Public Employee Performance Evaluation, City Manager, Government Code Section 54957 (b) (1)

City Council decided that in lieu of the economy and budgetary restraints they could not approve a raise for the City Manager, but it was decided to extend the contract for the City Manager position for another five years. Appreciation was made to her for doing a good job and the staff is well rewarded for the work and efforts Susan Price does daily as the City Manager.

2. Conference with Legal Counsel – Anticipated Litigation – Government code Section 54956.9 and 54954.5 (c)

No action was taken on this item due to time constraints and will be brought back at a later date

Chuck Young, Tehama County Police Officers Association President, led the Pledge of Allegiance at the request of Mayor Flynn and the assemblage joined in.

Robert Harvey, Tehama County resident, spoke in regards to the sewer project being proposed for the Antelope Valley Area and submitted a letter to City Council explaining what his purpose was. He had also made this presentation to the Board of Supervisors and the request is that the City and County open all staff meetings regarding the sewer proposals to the public and advertise them so that they can attend.

Alan Abbs, Tehama County Red Bluff Landfill Management Agency, mentioned that Thursday, April 22, 2004, is Earth Day and that in celebration, a Mercury Thermometer Exchange is being held at St. Elizabeth Community Hospital and is being hosted by the Landfill Management Agency. You can turn in your old mercury thermometer and receive a new free thermometer.

Green Waste of Tehama is also sponsoring an annual neighborhood clean-up event this coming weekend, putting out four dumpsters for citizens to throw out waste.

A series of Household Hazardous Waste Events is starting this weekend and will be running through the end of May for four hours each Saturday. They will be accepting household hazardous waste free of charge with a limit of 50lbs per load.

Mayor Flynn presented the proclamation to Chuck Young, President of Tehama County Peace Officers Association, recognizing the important role our Police Officers have in maintaining a free and peaceful society. He proclaimed May 12, 2004 a Memorial Day in commemoration of those Peace Officers who have given their lives in the line of duty and flags located at City Hall and the Community/Senior Center will be flown at half-staff on this day.

Chuck Young, President of Tehama County Peace Officers Association, thanked the City on behalf of all law enforcement agencies in the county and invited everyone to participate in a special Memorial Event at Bethel Church on May 12, 2004 at 7:00 p.m.

Approved 5-0-0

RATIFY/APPROVE MARCH PAYROLL CHECKS NUMBERS 15630-15758; FEBRUARY/MARCH PAYROLL DIRECT DEPOSIT NUMBERS 3139-3414; MARCH PAYABLES CHECK NUMBERS 44321-44639

Approved 5-0-0

RESOLUTION NO. 16-2004; STREET CLOSURE BOAT DRAGS “SHOW AND SHINE:

RESOLUTION NO. 17-2004, DESIGNATION OF LOADING ZONE AT VILLA COLUMBA 460 MAIN STREET

REQUEST BY TEHAMA LOCAL DEVELOPMENT CORPORATION EXECUTIVE DIRECTOR FOR WAIVER OF $8 MILLION IN CITY DEVELOPMENT IMPACT FEES FOR COUNTY PROJECT TO HOOK UP TO THE CITY’S WATER AND SEWER SYSTEMS

Susan Price, City Manager, reviewed the staff report and gave staff’s recommendation to hear the request from the Executive Director of Tehama Local Development Corporation, for a waiver of $8 million in City Development Impact Fees for a County project to hook up to the City’s water and sewer system and provide direction to City staff.

Dexter Wright, Executive Director of TLDC, read a brief letter and then gave an explanation for the request that the City Council waive the City’s $8 million estimated Development Impact Fees. This request is being made for a company that is considering building on property located in the County, which would need to hook up to the City’s water and sewer systems to operate.

The Project Cypress Company is a major manufacturer of high quality non-alcoholic beverages that wants to build a plant to bottle and distribute approximately 55 million cases per year to the Western United States. The project will provide 335 F/T jobs averaging $50,000 per year. Additional 216 jobs will be created in the community as a result of this project and there will be a 900,000 square foot commercial building built with a 10 year Economic Impact of approximately $315 million.

The City is requesting $8 million in Development Impact Fees where the actual cost to serve the necessary utilities, water, and sewer, according to the Company’s calculations are approximately $1.3 million.

The Project Cypress Company is willing to pay the actual cost to connect to the City water and sewer services of $1.3 million, but not the estimated $8 million in Development Impact Fees. The Project Cypress Company has requested a waiver of the $8 million Development Impact Fees. It was suggested that in order to stay competitive with other sites in attracting this company, that the City move forward in a timely matter.

The benefit over other sites is that this piece of property was zoned correctly and would allow moving forward at a brisk pace. Financial incentive is a high priority to the decision by this company as well as the ability to move quickly on this site.

It was mentioned that negotiations and discussions could predicate that development of jobs over a specific period of time be made available along with the request for the waiver by the City.

The central location of Red Bluff is an advantage, where the product could be transferred either 1 day north or 1 day south serving a tremendous area with a lower cost of living, land, construction, and large work force.

Gary Antone, Public Works Director, explained the disparity between the $8 million and $1.3 million costs. The $1.3 million is the physical cost to connect to the system for this development to come on line. The $8 million Development Impact Fee is what is charged to all developers and it reflects the impact of the development fee on our system calculated on data from the Impact Fee Study where cities needing to have fees for mitigating needs for future expansion and capacity of the development.

Richard Crabtree, City Attorney, mentioned legal and policy issues that begin with concerns about a project that is outside of the City limits. Legally there is no obligation for the City to provide the service. The City does have broad discretion to condition an application for extension of service outside the city limits by applying these kinds of fees. This proposed plant would use approximately 50% of unused capacity in the sewer system and would put the City in an expansion mode. In order for a sewer system to work properly you don’t want to use a 100% and you need to have capacity built into the system. The expansion would have to be funded and paid for somehow.

Enterprise funds have been established, by collecting Impact Development Fees just like this one and the City is limited by law on how to spend these monies. You can only charge people a fee that has a reasonable nexus to the impact of the service or it becomes an illegal use of the development fees and as a result money would have to eventually come from the general fund. The impact fees are to pay for the individual project’s impact and there aren’t fees there to pay for someone else’s impact on the system. There might even be a problem providing this service with more volume and pressure than we have in the system and the City would have to provide a dedicated well for this business that will have to be paid for. It’s over simplistic to just view it as a fee waiver and the City needs to look further than that and see how it will pay for the capacity that it will be waiving fees on.

Councilmember Frey stated that the City would be charging the company a very good monthly fee to pay for water and sewer.

Mr. Crabtree stated that as the Public Works Director explained that the money can’t be used for expanding the facility.

Councilmember Frey asked why money that we take in for water and sewer can’t be used for expanding water and sewer capacity and it was explained that those monies could only be used for maintenance and operation.

Councilmember Frey questioned where the money goes that they would be paying for their water and sewer usage.

Mr. Antone explained that the User Fee is a monthly fee that everyone on the system pays and 20% is paid on a monthly basis back into the system to correct and replace and upgrade the existing system. If those fees were larger than what was needed to fund maintenance and operation they would be an illegal tax as they can’t set fees higher than the actual cost of maintenance and operation.

The Development Impact Fee is for capital improvements necessary to “extend service to undeveloped areas and expand capacity”. The City doesn’t negotiate Impact Fees but the actual demands and usage’s are given an approximate fee based on information provided.

Susan Price, City Manager, explained that one solution would be for the company to request annexation that would give the company the ability to acquire a Development Agreement that allows the City and the Developer to negotiate a Development Agreement.

Richard Crabtree, City Attorney, explained that the Development Agreement would give flexibility and may include deferral fees and that the City is still going to have to fund the expansion some how and this project dramatically impacts the water and sewer facilities of the City. The California Environmental Act requires a CEQA analysis by the City for all permits or discretionary actions that will generate traffic impacts on the City.

Other businesses in the area may end up arguing that under the equal protection laws the City is treating other businesses differently and the City would have to have a good public policy reason for the distinction of waiving these fees.

The discussion was that the City would agree that they will consider providing service and will negotiate the impact fee contingent upon the successful negotiation of the fee and further discussion and action by the Council would need to be soon.

Bill Goodwin, Tehama County Director of Public Works mentioned that there will be traffic issues and that the County Planning Department might not be able to condition this properly for the traffic impacts and this is the City’s opportunity in these negotiations to include other issues that are relevant such as these. He reminded the City Council that one of the things that Tehama County has is a lot of is quality water and it is very valuable at any cost.

M/S/C Stevens, Frey to authorize extending water and sewer service to this project located outside of the City Limits, contingent upon the successful negotiation of this project’s Development Impact Fees.

PUBLIC HEARING; MITIGATED NEGATIVE DECLARATION; 3 MG RESERVOIR PIPELINE REALIGNMENT PROJECT

Gary Antone, Public Works Director, reviewed the staff report and gave staff’s recommendation to:

2. Consider all public testimony and all other information relating to this project submitted to the City Council.

3. Approve the Mitigated Negative Declaration for the 3 MG Reservoir Pipeline Realignment Project with the Findings in the document titled “Conditions and Findings”.

Gary Antone, Public Works Director, explained that the hearing for the request for funding through the State Infrastructure Bank is on for April 27, 2004 and the authorization for funding is very close.

M/S/C Avilla, Houghton to approve the Mitigated Negative Declaration for the 3 MG Reservoir Pipeline Realignment Project with the Findings in the document titled “Conditions and Findings”.

RESOLUTION NO. 18-2004, ROBERT SCHMID PURCHASE OF 2224 WASHINGTON STREET PROPERTY

Gary Antone, Public Works Director, reviewed the staff report and gave staff’s recommendation to adopt Resolution No. 18-2004 authorizing the sale of the property at 2224 Washington Street to Robert Schmid for the net amount of $15,000 with the revenue placed in Fund 19-Transportation.

Councilmember Stevens inquired about putting the funds in the General Fund and transfer it later. It was explained that from an accounting point of view, to have the money set aside is better and that once it’s in the General Fund it’s more likely to be used.

M/S/C Avilla, Houghton to approve the Mitigated Negative Declaration for the 3 MG Reservoir Pipeline Realignment Project with the Findings in the document titled “Conditions and Findings”.

SOCIAL SECURITY ADMINISTRATION USE OF CITY COUNCIL CHAMBERS

This item was not discussed at this meeting and will be brought back to the agenda at another time due to the Social Security Administration representative being unable to attend this Council meeting.

USER FEE STUDY FOR THE COMMUNITY CENTER

Margaret Van Warmerdam, Director of Finance, reviewed the staff report and gave staff’s recommendation to discuss the three levels of service for preparing the Community Center rental fees along with the proposed fee associated with each level and provide direction to staff.

The Proposals to Evaluate Community Center Rental Rates were a result of a study by Maximus.

The first two services offered included a Comparison Market Rate Analysis and the third was based on a Unit Cost Analysis. The Unit Service without the Add-on service Market Analysis for $1,000 was preferred based on the lack of similar facilities to compare it to.

The Community Center caters to youth and seniors that include abbreviated rates with different tiers. The City and County will continue to subsidize the running of the Community Center along with the support of the Community Donations.

M/S/C Avilla, Stevens to authorize Service Level 3: Unit Cost Analysis - $ 4,000.

Margaret Van Warmerdam, Financial Director, reviewed the staff report and gave staff’s recommendation to discuss the dollar amount for a business license for events at the Community Center and direct staff to bring back to the City Council an amendment to the City’s ordinance for business license fees at the Community Center.

Events at the Community Center are mostly non-profits or small groups and the Community Center is not looking to recoup the costs but to offer a 1 to 2 day business license at a minimum flat fee of $2. This permits them to hold their event and abide by the Ordinance requiring a license, and for those who already hold a local business license the fee is waived.

M/S/C Avilla, Houghton to direct staff to bring back to the City Council an amendment to the City’s ordinance for business license fees at the Community Center.

Michael Damon, Fire Chief, reviewed the staff report and gave staff’s recommendation to authorize a Supplemental Budget Appropriation in the amount of $8,000 from Fund 19 and authorize the Public Works Director to include the Station II Roof Project with the Airport Roof Projects.

Fire Chief, Michael Damon, also mentioned that the State of California has cut loose $29,000 for the strike team that went to Southern California to fight the fires.

M/S/C Avilla, Stevens to authorize a Supplemental Budget Appropriation in the amount of $8,000 from Fund 19 and authorize the Public Works Director to include the Station II Roof Project with the Airport Roof Projects.

Councilmember Stevens attended the Transportation Commission Meeting and there was no new significant information.

Richard Crabtree, City Attorney, attended the Red Bluff Round-up with his family and had a great time.

Councilmember Flynn mentioned that the opening ceremony of the Red Bluff Round-up was very moving and well worth the admission.

Councilmember Avilla thanked the Fire Department for the opportunity to ride Putty Put Fire Engine along with Councilmember Houghton, in the Red Bluff Round-up Parade.

At 9:20 P.M. Mayor Flynn adjourned the meeting to May 4, 2004 at 7:00 P.M., in the Red Bluff City Council Chambers.

Approved 5-0-0

RATIFY/APPROVE MARCH PAYROLL CHECKS NUMBERS 15630-15758; FEBRUARY/MARCH PAYROLL DIRECT DEPOSIT NUMBERS 3139-3414; MARCH PAYABLES CHECK NUMBERS 44321-44639

Approved 5-0-0

Approved 5-0-0

RESOLUTION NO. 16-2004; STREET CLOSURE BOAT DRAGS “SHOW AND SHINE:

RESOLUTION NO. 18-2004, ROBERT SCHMID PURCHASE OF 2224 WASHINGTON STREET PROPERTY

SOCIAL SECURITY ADMINISTRATION USE OF CITY COUNCIL CHAMBERS

USER FEE STUDY FOR THE COMMUNITY CENTER

S/B FORREST FLYNN