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HomeMy WebLinkAbout1987-01-28HUNTINGTON BEACH PUBLIC FACILITIES CORPORATION AMENDED MINUTES ADJOURNED MEETING OF JANUARY 28, 1987 The Adjourned Meeting of the PFC was called to order by President Wight at the City of Huntington Beach Central Library, Huntington Beach, California at 4:00 P.M. on aforementioned date. Roll call was taken as recorded below. There were present from the Board: Stephen Wight Lorraine Faber Thomas West Melvin Carpenter Absent: Joseph Garafalo Also attending were: Councilwoman Ruth Finley Councilman Peter Green Robert J. Franz, Deputy City Administrator Joan Arneson, Bowie Arneson Kadi and Dixon Dan Villella, Assistant Secretary Shari Donoho, Recording Secretary Don Kiser, Assistant Secretary Ron Hayden, Library Director, Community Services Department The first order of business was the approval of the December, 1986 minutes. Motion made, seconded and approved to accept the December, 1986 minutes. The next item was the treasurer's report for the month of November, 1986. Motion made, seconded and approved to accept the treasurer's report. Mr. Wight requested that the treasurer's report be prepared on a quarterly basis to better synchronize with the Board's meetings. A motion was made, seconded and approved to adopt a quarterly format for the treasurer's report. Under old business, the reports from legal counsel, Joan Arneson, regarding the disposition of funds and terms of office were reviewed. Mrs. Faber indicated that she would like to review the meeting between the board representatives and city administrative staff that was held January 14, 1987 relative to the childrens wing of the central library. The board inquired of Ms. Arneson if such a topic could be discussed in lieu of the new amendments to the Brown Act and the fact that this item had not been placed on the agenda for this meeting. 4 Ms. Arneson stated that the board could discuss the item, but in order to take action on such an item a 2/3rds vote or if less than 2/3rds present a unanimous vote of the board would be required to determine that a need to take action arose after the agenda had been posted. Mr. West indicated that discussion of the January 14, 1987 meeting could be addressed under informational items. The board needed to address a motion which had been taken at the December meeting, however, reformatting a motion into a resolution so that monies could be distributed into appropriate funds. Ms. Arneson stated that two motions were required. The first motion should reflect that the Board has determined that the need to act on the item arose after the agenda was posted. Motion relative to adding the moving of the funds to appropriate categories made, seconded and passed. Ms. Arneson stated that this motion now placed the item on the agenda. The board may now act on the item just as though it had originally appeared on the agenda. Mr. West moved that the board distribute the funds according to the treasurer's report of October 31, 1986 with the proviso of $110,000 which would be placed into the administrative fund for future use by the corporation. The residual amount to be placed into the construction fund. Mr. Villella advised that he would prepare the resolution but had some question to the retention requirement of the debt service fund. Some discussion was then held with regards to the debt service requirement of principal and interest. Ms. Arneson suggested that the resolution contain wording that indicates the board is so directing the trustee pursuant to Section 504(b). The board held discussion that the $110,000 could remain in the bond redemption fund and need not be transferred to the administrative fund. Mr. West then restated the last portion of the resolution to read; be it resolved that the board directs the trustee to distribute the funds according to the trustee's report of October 31, 1986 with the proviso that the residual amounts from the bond redemption fund be transferred to the construction fund consistent with Section 504(b)(iii). Motion introduced, seconded and passed. Under informational items, Mrs. Faber introduced councilmembers Ruth Finley and Peter Green to the boardmembers and Ms. Arneson. Mrs. Faber asked for input from the council liaisons. Mrs. Finley indicated that it was difficult to share any personal thoughts she may have relative to the Library at this point in time predicated on the outcome of the current library needs study and the goals and directions of the council. Mrs. Finley did state that she was appreciative for the invitation by the board to attend this meeting and was present as a spectator to listen and learn and to provide whatever assistance she may in the way of answering questions as long as such questions would not compromise her position as it must be understood that she could not speak for the entire council.. .V• -2- Tape 87.001/2939j Mr. Green advised that to be considered also is the voting direction that the four new councilmembers will be taking. Mr. Green stated that it was too early to determine the direction the council would take, as the majority of the members have been in office for only one month. Mr. Green relayed that this was a time to weigh things and encouraged the board to prepare their case as strongly as possible for a childrens wing at the central library facility, as well as other activities which the board would like to see accomplished. Mr. West responded that the Public Facilities Corporation is not promoting the construction of the childrens wing. The board is being responsive to the library and its constituents in terms of their desires, ambitions and goals and a plan has been presented to the board. As guardians of this resource, the board has certain obligations and one of those obligations is to assist with the facility, within the limits of their charge. When the library staff came forward they had indicated that they had master plans which called for a childrens wing. The board has identified a need, in the interest of and responsibility to the city council and the city, to place these monies in the construction fund with the anticipation as to what the city does fully intend to accomplish. Mr. West reiterated that the board was not taking the position to promote the childrens wing as a lobby group, but present only to do the job of the Public Facilities Corporation Board. Mr. Green felt that this was a very, important distinction as to the position of the PFC. Mr. Carpenter stated that he felt Mr. West had been precise as to the position of the board, but wished to add that by Charter, the PFC was only interested in lending monetary assistance to the central library facility only and not to the satellite structures. Mrs. Faber stated that it was the consensus of the board not to assume authority to make decisions for expansion, but to reserve the right to advise on situations pertinent to the city's facility. The role of the board is that of landlord of the central library facility. Also, the board is to be responsive to the direction the council decides to take, or not to take, in regards to expansion of the central library facility. Mrs. Faber then recapped the meeting of January 14, 1986. As directed by Chairman Wight, Mrs. Faber and Mr. Garafalo met with council liaisons Ruth Finley and Peter Green, along with city administration. Mr. Garafalo and Mrs. Faber reviewed with these dignitaries the accomplishments of the board this year, i.e.; initial orientation to the facilities and legal documents, the city's decision to self insure, the defeasance, as well as initiating legal counsel's review of the arbitrage situation. Mrs. Faber indicated that the step which was taken at todays meeting to realign funds, will assist in creating a more defendable position with regards to arbitrage. Mrs. Faber advised that a topic at the meeting was whether it was important to respond to the City Council's request for rebate immediately, or whether such action could be delayed until such time as the consultant report was submitted. It was Mrs. Faber's :8z Tape 87.001/2939j understanding that such action could be delayed until after the report had been received. Mrs. Faber inquired of Mr. Franz whether her interpretation had been correct. Mr. Franz indicated that he felt her interpretation was basically correct from a city administration point of view but that the issue of the request for a rebate to the city should not cloud the other question before the PFC that relating to the arbitrage situation. Mrs.'Faber stated that Mr. Franz had brought into focus the fact that if a corporation, such as the PFC, were being established today, it would not have as many powers. Mrs. Faber stated that while this may be true, the PFC must deal within the framework that has been established in the governing legal documents of the corporation. Mr. Franz advised that what he was attempting to convey was that the money would not be accumulated over the years as it has with the PFC funds. That under todays structuring of a corporation, each year when the rent became due there would be a rebate. Ms. Arneson indicated that the monies would serve as a credit to the city. Mrs. Finley and Mr. Green concurred that the meeting proved to be positive and conveyed a cooperative relationship between the board, city staff and council. Mr. Carpenter inquired if council had been advised that the PFC had offered to fund the consultant study. Mrs. Faber advised that this offer had been conveyed, but that it was an administrative decision that the study would be paid with city funds. Mr. Hayden stated that he was somewhat sensitive to the suggestion that library staff had approached the board about funding of the childrens wing. Mr. Hayden indicated that the board had been addressed in response to a request from the board to be provided an opportunity to learn of capital improvement projects that had been mentioned in the capital improvement document. Mr. Hayden went on to clarify that it was a presentation only, that there was never any request for funding ever made of the PFC by library staff. The board agreed with Mr. Hayden's clarification. Mr. West went on to state that if his comments had been misconstrued, it was not his intention to imply that library staff had approached the board regarding funding of capital improvement projects. Mr. West's sole intent was to have Councilman Green understand that the board was not lobbying on the behalf of the library. Mr. Wight felt that the motion to adopt the resolution regarding the distribution of funds needed to be amended to reflect the cause for such action. Mr. West indicated that at the December meeting, the board had held discussion relative to the distribution of monies to appropriate the funds. The board had, at that time, requested that the motion reflect that the residual amount would be placed in the construction fund earmarked for the capital -4- Tape 87.001/2939j -improvements of the libraryconsistent with the original master plan and any update. Pursuant to the motion as referenced on page 6, paragraph 3 of the minutes of December 8, 1986, the resolution made at this meeting was passed so as to be within the legal constraints as stipulated in Section 504(b)(iii) of the indenture, specifically earmarking the funds, as stated in the original motion. The board reviewed the amendment to the bylaws relative to election and term of offices. Mrs. Faber stated that the reference to an annual June meeting was no longer consistent with the quarterly meetings of the board. Mr. West suggested that this be placed on the agenda for the April meeting as an action item to make the required change to the bylaws, reflecting July instead of June. Mr. Wight directed the item be placed on the agenda for the month of April. Ms. Arneson inquired whether it was the intention of the board to move the election of the directors to July. Indicating that normally, the terms of office would expire in January. Mrs. Faber stated that this was correct. Ms. Arneson then inquired if it was the intention of the board to elect directors to cover the six/seven month period. Mrs. Faber advised that it was the board's intent to operate under article 4, section 2 of the bylaws, in that if there is no election, the directors in office would continue until the annual election. Mr. West requested that Chairman Wight instruct staff to forward this information to the city council and indicate that the current directors will continue to serve until the elections are held in July. Mr. Green felt that being afforded a copy of the. current and amended section of the bylaws relative to election and terms of office would prove beneficial, for comparative analysis, by the other councilmembers. Mrs. Faber advised that no other city board members are elected annually inquiring of Mrs. Finley and Mr. Green as to the appropriateness of staggering the terms of office for the PFC directors and expanding such terms to three years. Mr. Green advised that this was appropriate and felt it would guarantee continuity. Mr. Green requested that in the aforementioned communique to council the reasons for staggering and extension of terms be listed to inform all councilmembers. relative to this issue. The Brown Act amendment was reviewed and discussed. Mrs. Faber to work with the recording secretary in preparation of a response to the Mayor's letter of January 8, 1987, which shall address not only the current directors serving until the elections in July, but shall afford councilmembers with the current and amended section of the bylaws relative to election and terms of office, as well as the reasoning for staggering the terms of office of the directors and expansion of the terms to three years. Mr. Wight indicated that he would like an agenda item for the April meeting to discuss whether or not the board would like to offer a matching amount of money to the city council for funding the library needs study. 572 Tape 87.001/2939j Under director's comments, Mrs. Faber indicated that she would like to have audience communication moved to 43 on the agenda and entitled "public input". Ms. Arneson suggested that some public bodies add another agenda item near the beginning as a special item under which items that need to be added, such as the one that was taken earlier this meeting, entitled "items to be added - 2/3rd vote required". Staff was requested to make these changes to the agenda format. Mrs. Faber felt that the agenda and notice should be posted at the library facility, as well as city hall. Mrs. Donoho advised that this was being done currently. Mr. West made an observation regarding the library needs study. It was Mr. West's feeling that $25,000 would not provide adequately for the consultant study which was needed. Mrs. Finley inquired whether or not the $25,000 was in addition to staff time. Mr. Franz advised that the dollar amount was in addition to staff time. Mr. Hayden indicated that three consultants were contacted, the ballpark figures given ranged from $17,000 to $27,000. Mrs. Faber requested that staff provide all directors with the forms for statement of economic interest which must be filed by April. Staff will check with the City Clerk's Office and respond back to the board members. Mr. Wight indicated that he would like staff to provide him with a report which outlines what was brought in on the original library bond issue, what was spent for constructions to reflect excess, what was paid in rents and what was generated as interest - more specifically, what was overpaid in rents. Mr. Villella indicated that. rents was fairly simple - $399,000 per year. The board and staff held discussion as to exactly what Mr. Wight wanted in the way of a report. Mr. Wight specified that the start date for the report would be at the end of all construction. Further, Mr. Wight indicated that at the end of construction there was a specific dollar amount the PFC maintained that the city did not pay in rents. He wished to know what that figure was, what the excesses or underages were for the ten year period, and what the accumulated interest figure would be. Mr. Villella inquired if Mr. Wight was attempting to determine, of the current excess amount, what portion is directly attributable to the different aspects. Mr. Wight answered affirmatively. Mr. Villella stated that problems could be encountered, indicating that the board has had various expenses throughout the years, what was the source of those expenses. Mr. Wight felt that a portion of the funds could be identified as administrative expenses and pulled from the report, as Mr. Villella would not be working under a budget for each one of the funds. Mr. Villella clarified that all that was required was the revenue side - how much money has ever come into the possession of the PFC from day one. Mr. Wight felt that it need not be very complex. Indicating that Mr. Villella could start with a dollar figure in the year 1975, stating that the building has been assumed by the city and that these .were the -6- Tape 87.001/2939j `funds available. Mr. Villella clarified his understanding, indicating that the dollar figure that he would bring back to Mr. Wight would be several million dollars. Mr. Wight stated that he was aware of this fact. Mr. Villella indicated that somewhere in the computation he would. have to net and was unsure as to what Mr. Wight intended to be net, nor from which one of the sources. Mr. Wight indicated that what he understood Mr. Villella to say is that to be considered is not just principal and interest, but all expenses related which should then be applied. Mr. Villella inquired, all expenses of the corporation - from day one, how are they to be allocated from the original bond issue, versus rent revenue, versus interest revenue. Mr. Wight indicated all he was interested in was the bulk figures - just income. Mr. Wight indicated that he would call Mr. Villella directly and did not wish to take any more time on the subject. Ms. Arneson offered that perhaps the trustee would have available the information Mr. Wight was requesting. Mr. Wight asked that Mr. Villella make such an inquiry of the trustee. Under audience communication, Mr. Hayden advised the board that phase one of the library's public parking landscape project had been completed. This phase called for the removal of shallow rooted eucalyptus trees and the establishment of an irrigation system. Mr. Hayden indicated that phase two would include concrete work, replanting, but most importantly a ramp from the. auxiliary parking lot across Talbert to the public parking lot directly in front of the facility. Mr. Hayden stated that this ramp would be a much more safe and attractive means of entering the building. Phase two has been estimated at $43,000. Mr. Hayden provided the board with blueprints for their review. Mrs. Faber inquired if this was a request made by city administration, city council, or whether it was only for the board's information. Mr. Hayden indicated that he and Mr. Bowman had discussed the phase two project and that he was investigating means of financing the project prior to next year's budgetary process, as this area could remain in its present desolate state for quite sometime if it must be addressed through the budget. Mr. West made the suggestion to the other board members that financing for the project be entertained only if it comes as a request from the city administration and city council. Mr. West went on to state that protocol in this situation has dictated that a divisional request is made to the department head, from the department head to the city administrator, from the city administrator to the city council. The council would then advise the board of their desire to have the project funded. The board would then fund the project - that is the role of the board. If the request comes through in this fashion, the board would take action in April either to accept or not accept. If this process is followed in this manner, the board would be assured of not falling at odds with either city administration or city council. If the phase two project is accepted by council, Mr. Wight requested that the item be placed on the agenda for consideration and possible action in April. -7- Tape 87.001/2939j Mr. Franz inquired whether the request as made by city administration in December had been answered. Mr. Franz indicated he was unsure as to whether, by the actions, motions and resolutions to instruct the trustee, the board had intended to communicate to the city a response to the December letter/request. Mr. West clarified that what Mr. Franz was indicating was that the city needed a response to the December 5, 1986 letter. Mr. West felt a written response was due. The board held discussion as to what the context of the letter should convey to city administration. Mr. Wight indicated that the message would be that the money has been set aside into a fund and that if the council so chooses to direct the board to fund a capital program at the library the board would then consider such a request. The $43,000 phase two project submitted today by Mr. Hayden would fall into this category and would be consistent with how the board has operated historically. Mr. Wight requested that Mrs. Faber coordinate a response to the city administrator. Mrs. Faber will forward the letter to Mr. Wight and the other directors for final approval. Mr. Franz stated that it was his desire to close this final loop and felt that if a written response to Mr. Thompson's December 5th letter were received by city administration, that this would serve this end. Mrs. Finley stated that she knew what Mr. Franz was attempting to accomplish along these conversational lines, referencing the difference between what city administration wants done with the money as specified by council direction, and what the board has taken action to do at this meeting, placing the monies into the construction fund. Mrs. Finley indicated that placing the money into the construction fund is not the answer city administration had preferred, but it was an answer. Mr West indicated that the legal opinion rendered by Joan Arneson provided the board with four options. The December 5th letter was viewed by the board as a request by city administration, not a directive. The board's response to that request was to send liaisons to meet and obtain ground for mutual understanding, which has been done. Now the letter that will be sent is a confirmation of those understandings, reporting back the board's action, and an articulation of the procedure whereby the city will still have. open access to those resources to perform the kinds of project such as Mr. Hayden has brought before the board today. -8- Tape 87.001/2939j Mrs. Faber inquired whether the board desired Ms. Arneson's presence at the April, 1987 meeting. The board will advise Ms. Arneson at a later date if her attendance is required. The meeting was then adjourned to 4:00 P.M. on Wednesday, April 29, 1987 at the Central Library Facility, Balboa Room, 7111 Talbert Avenue, Huntington Beach, California. HARI K. DON HO Recording Secretary DAN T. VILLFILLA Assistant Secretary, H.B.P.F.C. Note: Statements referred to hereinabove are noted as being in general only and are not intended to be verbatim quotes. Approved: STEPHEN WIGHT President, H.B.P.F.C. LORRAINE FABER Secretary/Treasurer, H.B.P.F.C. -9- Tape 87.001/2939j