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HomeMy WebLinkAbout2023-06-26Minutes City Council/Public Financing Authority City of Huntington Beach Monday, June 26, 2023 5:00 PM — Council Chambers 6:00 PM — Council Chambers Civic Center, 2000 Main Street Huntington Beach, California 92648 A video recording of the 5:00 PM and 6:00 PM portions of this meeting is on file in the Office of the City Clerk, and archived at www.surfcity-hb.org/government/agendas/ 5:00 PM — COUNCIL CHAMBERS CALLED TO ORDER ADJOURNED REGULAR MEETING OF THE CITY COUNCIL/PUBLIC FINANCING AUTHORITY — 5:32 PM ROLL CALL Present: Kalmick, Moser, Van Der Mark, Strickland, McKeon, Bolton, and Burns Absent: None CITY COUNCILMEMBER COMMENTS (3-Minute Time Limit) Councilmember McKeon thanked the community for their patience through the budget process, and read a prepared statement to express his disapproval of certain budget decisions made by the previous City Council and his frustrations regarding campaign mailers recently distributed by Councilmember Kalmick that in his opinion presented false information and misrepresented the Council majority’s pledge for fiscal responsibility. Mayor Pro Tem Van Der Mark thanked community members for their participation in the budget process, and read a prepared statement to make clear the Council majority’s pledge for fiscal responsibility, and her opinion that financial decisions made by the previous City Council are responsible for the City’s current financial standing. Councilmember Kalmick thanked the community for attending, disputed the validity of statements made by Councilmember McKeon and Mayor Pro Tem Van Der Mark, and looked forward to a productive budget discussion. Mayor Strickland acknowledged the City’s financial position, emphasized strong Council support for the Police Officers’ Association (POA) and unanimous approval of the POA MOU. He also acknowledged the hard work of staff and Council to consider potential budget cuts necessary to achieve a balanced annual budget, and informed the public that cuts proposed in the original Budget Balancing Plan related to library services and beach maintenance, among other things, had been removed from consideration. City Council/PFA Adjourned Regular Meeting Minutes June 26, 2023 Page 2 of 13 ANNOUNCEMENT OF SUPPLEMENTAL COMMUNICATIONS PERTAINING TO CLOSED SESSION ITEM (Received After Agenda Distribution) Pursuant to the Brown "Open Meetings" Act, City Clerk Robin Estanislau announced supplemental communications that were received by her office following distribution of the Council Agenda packet, which were all uploaded to the City's website and Councilmember iPads: Closed Session Item #1 (1 email communication) PUBLIC COMMENTS PERTAINING TO CLOSED SESSION ITEM — None. A motion was made by Burns, second by Van Der Mark, to recess to Closed Session for Item 1. RECESSED TO CLOSED SESSION — 5:34 PM CLOSED SESSION 1. 23-567 CONFERENCE WITH LEGAL COUNSEL-EXISTING LITIGATION. (Paragraph (1) of subdivision (d) of Section 54956.9). Name of case: Clayton-Tarvin (Gina) v. City of Huntington Beach, et al.; OCSC Case No.: 30-2023-01329927. 6:00 PM — COUNCIL CHAMBERS RECONVENED CITY COUNCIL/PUBLIC FINANCING AUTHORITY ADJOURNED REGULAR MEETING — 6:00 PM ROLL CALL Present: Kalmick, Moser, Van Der Mark, Strickland, McKeon, Bolton, and Burns Absent: None PLEDGE OF ALLEGIANCE — Led by Councilmember Moser CLOSED SESSION REPORT BY CITY ATTORNEY — None. ANNOUNCEMENT OF SUPPLEMENTAL COMMUNICATIONS (Received After Agenda Distribution) Pursuant to the Brown "Open Meetings" Act, City Clerk Robin Estanislau announced supplemental communications that were received by her office following distribution of the Council Agenda packet, which were all uploaded to the City's website and Councilmember iPads: Consent Calendar Item #2 (1 email communication) City Clerk Estanislau announced that staff made copies of the latest Revenue Opportunities and Budget Reductions worksheet for distribution to all. City Council/PFA Adjourned Regular Meeting Minutes June 26, 2023 Page 3 of 13 PUBLIC COMMENTS (3-Minute Time Limit) — 27 Public Speakers The number [hh:mm:ss] following the speakers' comments indicates their approximate starting time in the archived video located at http://www.surfcity-hb.org/government/agendas. Cari Swan was called to speak and thanked Councilmember Burns for his focus on a balanced budget, even during his City Council campaign, and noted that people in the private sector well understand budget cuts are part of responsible management. (00:18:06) Sharon Petersen, a resident of Huntington Beach for over 30 years and former teacher, was called to speak and shared her opinions on the importance of public libraries, and services for senior and disabled residents. (00:20:49) Ada Hand was called to speak and shared her opinions and concerns related to the Air Show settlement, and balanced budget options being considered. She asked that Council focus on eliminating homelessness, adopting a housing plan, and making Huntington Beach safer. (00:22:51) Allie Plum, a Huntington Beach "immobile" homeowner for a decade, was called to speak and shared her delight at just learning there are no plans to cut library hours or close any libraries. Ms. Plum asked all Councilmembers to communicate facts and truth. (00:26:05) Tim Geddes, a resident of Huntington Beach since 1983 and former Finance Commission Chair, was called to speak and shared his support for not cutting back on any library services, especially the Banning Branch which serves his neighborhood. (00:28:16) David Rynerson was called to speak and shared his opinions and concerns related to the Air Show settlement. (00:30:56) Joseph Wilson, a concerned Huntington Beach homeowner, was called to speak and shared his opinions and concerns related to the Air Show settlement. (00:32:33) Michelle Ferry, Community College Instructor, was called to speak and shared her opinions and concerns related to proposed library service cutbacks (00:34:57) Shammy Dingus, a 40+-year resident of Huntington Beach, was called to speak and shared her opinions and concerns related to proposed budget cuts. (00:38:06) Jeanne Farrens was called to speak and shared her opinions and concerns related to proposed budget cuts. (00:41:41) Unnamed Guest was called to speak and expressed her appreciation for the budget changes in the latest Revenue Opportunities and Budget Reductions worksheet distributed at this meeting. She also noted the amazing Summer Reading Kick-off at the Library this past weekend. (00:44:45) Unnamed Guest was called to speak and thanked Councilmembers for budget changes in the latest Revenue Opportunities and Budget Reductions worksheet distributed at this meeting. He also asked for more details on specific line items. (00:47:23) Mike B., a long-time Huntington Beach resident, was called to speak and thanked his fellow citizens for publicly sharing their knowledge. He also shared his opinions related to the on-going concerns about City Council/PFA Adjourned Regular Meeting Minutes June 26, 2023 Page 4 of 13 potentially objectionable library materials and stated his support for continuing the Community Café Forum. (00:50:39) Suzanne Hart was called to speak and stated her support for not making cuts to library services, and shared her concerns about potential consequences from other proposed budget cuts. (00:53:44) Mary Jacobs was called to speak and asked what is happening with Carr Park plans, and shared her concerns about any plans to reduce service to any City parks. Mayor Strickland asked her to complete a blue card for staff follow-up. (00:56:38) Unnamed Guest, a 43-year resident of Huntington Beach and former teacher, was called to speak and shared her appreciation for Councilmember concerns about the budget and their efforts to fix things that have been broken for a long time. (00:58:26) Russell Neal, a resident of Huntington Beach, was called to speak and shared his opinion that the current Council has not inherited a great financial situation. He further shared his concern for the physical safety of Mayor Pro Tem Van Der Mark after the many derogatory comments made during last week's discussion on her concerns regarding age-appropriate materials in the City's libraries. (00:59:51) Russell Carpe, a Huntington Beach resident for more than 13 years, was called to speak and shared his opinions and concerns related to proposed budget cuts. (01:02:46) Debra Falese was called to speak and shared her concerns about situations within the City which do not include freaking out about Pride flags or library books. (01:05:58) Mary Madigan, a resident of Huntington Beach, was called to speak and shared her opinions and concerns regarding proposed budget cuts. (01:07:47) Paul Simonds, Curt Pringle and Associates, representing their client Circuit, was called to speak and shared statistics to document the positive impact Circuit provides to Huntington Beach, especially for the Downtown area. (01:09:30) Ashley Dos Santos, a concerned and involved mother who lives in southeast Huntington Beach, was called to speak and shared her and her young daughter's concerns about any proposed library service cut-backs. (01:12:12) Kathy McGuire, a resident of Huntington Beach for over 30 years, was called to speak and thanked Councilmembers for their service. She read a written statement and summarized her sentiments by sharing her expectation that everyone be treated with kindness and acceptance as part of the mosaic of Huntington Beach. (01:15:29) Perry Clitheroe was called to speak and shared his opinions and concerns related to homelessness and the increasing costs of housing, and his support for free-market processes to improve economic freedom and tax revenue. (01:17:43) Rick Brown was called to speak and shared his opinions and concerns regarding the Air Show, and budget issues the current Councilmembers inherited. (01:19:55) City Council/PFA Adjourned Regular Meeting Minutes June 26, 2023 Page 5 of 13 Valentina Bankhead, a resident of Huntington Beach, was called to speak and asked Councilmembers to be accurate and cautious with budget decisions, and shared her opinions and concerns on budget issues. (01:22:25) Connie Boardman, Former Mayor and Councilmember who also served during a time of economic downturn, was called to speak and shared her concerns about the published proposed budget cuts that would directly affect quality of life for residents. (01:25:13) COUNCIL COMMITTEE APPOINTMENT ANNOUNCEMENTS — None. AB 1234 REPORTING — None. OPENNESS IN NEGOTIATION DISCLOSURES — None. CONSENT CALENDAR 2. 23-570 Adopted Resolution No. 2023-33 appointing Mark D. Alvarado as Interim Chief Financial Officer and approving the Employment Agreement A motion was made by Kalmick, second Burns to adopt Resolution No. 2023-33, "A Resolution of the City Council of the City of Huntington Beach appointing Mark D. Alvarado as Interim Chief Financial Officer"; and approve and authorize the City Manager to execute the "Employment Agreement between the City of Huntington Beach and Mark D. Alvarado." The motion carried by the following roll call vote: AYES: Kalmick, Moser, Van Der Mark, Strickland, McKeon, Bolton, and Burns NOES: None PUBLIC HEARING 3. 23-566 Continued from June 20, 2023 with Public Hearing open — Adopted Resolution No. 2023-24 to Adopt a Budget for the City for Fiscal Year 2023/2024 and Authorized the Corresponding Appropriation and Transfer of $4.9 Million of AES Reserves and $3.9 Million of Equipment Replacement Reserves and Return to a 12-year Paving Cycle; Resolution No. 2023-25 Establishing the Gann Appropriation Limit for Fiscal Year 2023/2024; Resolution No. 2023-23 Levying a Retirement Property Tax for Fiscal Year 2023/2024 to Pay for Pre-1978 Employee Retirement Benefits; Resolution No. 2023-27 Amending the City’s Classification Plan by Adding the Classifications of Graphic Designer, Multimedia Coordinator, Homeless Services Manager, and Municipal Records Manager; Resolution No. 2023-28 to Adopt a Revised General Fund Reserve Policy; Resolution No. 2023-26 Acknowledging Receipt of a Report Made by the Fire Chief of the Huntington Beach Fire Department Regarding the Inspection of Certain Occupancies Required to Perform Annual Inspections in such Occupancies Pursuant to Sections 13146.2 and 13146.3 of the California Health and Safety Code; Approved and Authorized the execution of Amendment No. 2 to the Agreement between the City of Huntington Beach and Mind OC for Pilot Mobile Crisis Response Program; Approved and Authorized the Execution of Professional Services Contract between the City of Huntington Beach and National Council for Community Development (NDC) for Technical Assistance Services; Approved and City Council/PFA Adjourned Regular Meeting Minutes June 26, 2023 Page 6 of 13 Authorized the Execution of Professional Services Contract between the City of Huntington Beach and Hinderliter, De Llamas and Associates for Sales and Use Tax Allocation and Audit Services; and, Approved the Budget Balancing Plan to Proactively Address the Fiscal Year 2024/25 Projected General Fund Deficit No Councilmember had any ex parte communications to disclose. Sunny Han, Acting Chief Financial Officer, and Tom Herbel, City Engineer, presented a PowerPoint communication titled: City of Huntington Beach FY 2023/24 Budget Adoption with slides entitled: Presentation Overview; Proposed FY 2023/24 General Fund Budget Review; FY 2023/24 General Fund Proposed Budget Review; FY 2023/24 General Fund Proposed Revenues - $283.1M; FY 2023/24 General Fund Proposed Expenditures - $290.2M; Recommended FY 2023/24 Authorized Positions (3); General Fund Reserve Policy (2); FY 2023/24 Capital Improvement Program (CIP); FY 2023/24 CIP Budget; CIP AES Funding Summary; AES Projects Map; Budget Balancing Plan (2); Level 1 Options - Effective July 1, 2023 (3); Level 2 Options - Effective January 1, 2024 (4); Summary of Budget Balancing Plan; General Fund Long-Term Financial Plan (2); Boards and Commissions (2); FY 2023/24 Budget Approval Requested; and City Council Approval Requested (3), and Questions? Councilmembers and City Attorney Michael Gates discussed in greater detail proposed staffing needs for the City Attorney's Office. In summary, City Attorney Gates noted that if the listed positions are not approved by City Council, the alternative would be to contract with outside legal firms at a magnitude cost to the City of two or three times the cost of hiring additional staff. City Attorney Gates noted the current workload requires current staff put in 60+ hours per week, and this is not a sustainable way to operate. He believes the solution is to hire more staff, or contract with outside legal firms, and this budget presents the least expensive option. City Attorney Michael Gates clarified for the benefit of the public that all public comments are documented in the records, and the court system could review Public Hearing speaker comments if there is future litigation on the Public Hearing topic. Pursuant to the Brown "Open Meetings" Act, City Clerk Robin Estanislau announced supplemental communications that were received by her office following distribution of the Council Agenda packet, which were all uploaded to the City's website and Councilmember iPads: Public Hearing Item #3 (327 email communications, and 1 Interdepartmental communication) Public Hearing Speakers — 25 Shirley Dettloff, Huntington Beach resident since 1964, was called to speak and thanked staff for an excellent job under very difficult circumstances in preparing this budget. Ms. Dettloff encouraged Councilmembers to allow appropriate time for citizen education and feedback during the budget process to ensure their concerns are adequately addressed. (02:47:38) Cathey Ryder, Huntington Beach resident since 1985, was called to speak and asked if every department made an attempt to reduce their budget. She shared her opinion that services should never be cut for seniors. She also requested a step back to review possible budget reductions for City Council, City Attorney and City Treasurer Departments. (02:50:43) City Council/PFA Adjourned Regular Meeting Minutes June 26, 2023 Page 7 of 13 Pat Goodman was called to speak and asked that the balanced budget presented on June 6, 2023, be approved because in her opinion it provides a prudent way to proceed with the City's business. Ms. Goodman asked that Councilmembers take the time to ensure budget issues are addressed in ways that engage and inform the community, and shared her concerns about how some proposed cuts may impact potential revenue. (02:53:24) Ken Inouye, a 50-year resident of Huntington Beach, was called to speak and thanked Acting Chief Financial Officer Sunny Han for her outstanding service. Mr. Inouye referenced page 27, specifically the three years ending FY 2026/2027, which shows a budget deficit of $33M, and suggested now is the time for the City to come together to develop a comprehensive financial budget plan that addresses the upcoming deficit. He encouraged Councilmembers to listen to residents’ budget concerns and prepare a fiscally responsible plan. (02:56:33) Debbie Cook, former Councilmember who has lived in Huntington Beach most of her life, was called to speak and shared her opinions and expectation that newly-elected Councilmembers should first observe to learn the culture of the community they serve. Ms. Cook shared her concern about the City paying for a private vendor's California Environmental Quality Act (CEQA) EIR, and stated to the best of her knowledge a legal firm has never been hired by the City on a contingency basis. (02:59:05) Jonathan Rust, a resident of Huntington Beach since 2007, was called to speak and stated his opposition to cutting any of the library’s services. He also stated he doesn't understand why the City Attorney’s Office is the only department that apparently has made no budget cuts. Mr. Rust asked that the relationship with the vendor providing the Air Show be reviewed as he finds it unusual to continue a relationship with a company that has cost the City so much. (03:02:59) Kay Goddard was called to speak and shared her concern about why there isn't more transparency from the City Attorney’s Office. She stated support for leaving the libraries, parks and beach services alone because they are important not only for the residents but also out-of-town guests. She asked for far more transparency and inclusion if the Council decides to move to a two-year budget process. (03:04:42) Jacqueline Brodt, Huntington Beach Wetlands Conservancy Member and Friends of the Library Former Member, was called to speak and shared her opinion that this Council is not listening to a majority of their constituents. She expressed her appreciation for the last-minute decision to not cut any library services in the current budget proposal. (03:07:02) Erin Spivey, AKA Erin the Librarian, was called to speak and stated her opposition to any Library and Community Services budget cuts. Ms. Spivey invited everyone to attend the Main Street Library program, Books and Bikes, Wheels and Wonder on Saturday, July 1, 2023, before the Downtown carnival kick-off, providing an opportunity for people to decorate their bikes, scooters and strollers as well as safety checks. (03:09:26) Russell Carpe was called to speak and stated appreciation for the staff presentation and Councilmember interactions. He also expressed his disappointment that Channel 3 did not have a posting for this meeting. Mr. Carpe shared his opinion that money should never be taken from the budgets of parks, libraries or beaches. As a disabled senior citizen who regularly uses Circuit, he stated support for keeping that service available. (03:12:52) Terry Rose was called to speak and stated her confusion on what is or is not being cut from the current budget. Ms. Rose asked if the Library's Collection Development process will be impacted by the new City Council/PFA Adjourned Regular Meeting Minutes June 26, 2023 Page 8 of 13 budget, and recommended that formal process be used by individuals rather than having the City dictate which books can be in the library. (03:14:39) Kimberly, who resides very close to Huntington Beach, was called to speak and shared her opinions regarding Councilmember transparency, costs for City lawsuits, and support for libraries, parks and beaches. (03:16:51) Chris Kluwe, a 15-year resident of Huntington Beach, was called to speak and shared his opinions related to the Mayor Pro Tem's proposed book ban. (03:20:38) Unnamed Guest was called to speak and expressed appreciation for learning that library services will not be cut in the proposed budget, and stated support for continuing the Circuit program and Community Café events. Unnamed Guest also stated opposition to increased costs for added staff in the City Attorney's Office, and support for properly addressing homelessness, libraries, parks and public work projects. (03:24:01) Mary Jacobs was called to speak and shared her opinion that the City Attorney has done a good job in past years of controlling costs, and her disappointment with the 36% increase in costs for this proposed budget. Ms. Jacobs shared her opinion that "empire building" shouldn't have any place in Huntington Beach, or the City Attorney's office. (03:26:21) Randy Kokal was called to speak and shared his opinions related to the direction Council appears to be heading which he believes is opposed by a majority of residents. He listed private censorship, secret settlements by the City Attorney, paying California Environmental Quality Act (CEQA) EIR costs for a private company, and systematic beheading of City Hall department heads as examples of actions the community does not support. (03:29:29) Karen Jackle was called to speak and shared her concerns related to street paving and requested there be enough funds in the budget for temporary repair of potholes. She also shared her opinions related to people not being properly prepared for Board and Commission meetings. Mayor Strickland asked Ms. Jackle to complete a blue card for staff follow-up. (03:32:51) Larry Slonim, a 42-year resident of Huntington Beach, was called to speak and shared his opinions regarding recent inappropriate comments made by Councilmembers. He further shared his frustration at not having enough information and time to clearly understand the proposed budget which does not give him a sense of confidence nor provide proper transparency. (03:35:04) Linda Moon, a 49-year resident of Huntington Beach, and retired Attorney, was called to speak and shared her opinions regarding proposed budget cuts for beaches, streets, sidewalks, parks, landscaping, libraries, senior services, and community recreation services which she believes will negatively impact quality of life in Huntington Beach. (03:38:46) Kane Durham was called to speak and shared concerns that this last-minute budget change may not be legal, and appears to be a violation of the Brown "Open Meetings" Act. He noted the numbers discrepancy between the staff presentation and the last-minute 3-page budget change. Mr. Durham expressed support for Circuit and the Community Café Forum, and stated opposition to the proposed addition of Full Time Employees (FTE) for the City Attorney's Office, as well as adding new multi-media employees. (03:42:01) City Council/PFA Adjourned Regular Meeting Minutes June 26, 2023 Page 9 of 13 Amory Hanson was called to speak and stated his support for Item 3 (H), the creation of three new positions in the Communications Department. (03:44:44) Oscar Rodriguez, a 26-year resident of Huntington Beach and Council Candidate in 2022, was called to speak and shared his support for the importance of library services to the community. He stated his opinion that this City Council appears to be defunding programs that provide vital services for low-income residents and seniors. He asked Councilmembers to get priorities straight to support seniors, youth and the great residents of Huntington Beach. (03:45:13) Barry Kielsmeler, a resident of Huntington Beach for 35 years, was called to speak and stated his appreciation to staff and Councilmembers for the extensive time put into the budget process. He stated that the last-minute 3-page budget information handed out at the beginning of this meeting indicates to him that something is dysfunctional, and suggested approving the June 6, 2023, balanced budget and making the changes recommended this evening at the mid-year budget review. (03:47:04) Cathy Green was called to speak and stated her support for maintaining the Ranger Program in Central Park. Ms. Green provided a brief history of the program start-up and first-year costs provided through efforts of the Huntington Beach Police Officers’ Association, Huntington Beach Hospital, and support from many citizens and private organizations. She noted the City agreed to provide on-going costs for this successful public safety program. (03:50:12) Arline Kaplan, a resident of Huntington Beach for 45 years, was called to speak and shared how important the City's libraries were to her children. She stated support for libraries as places to learn as well as locations for essential community gatherings. Ms. Kaplan stated her opinion that some Councilmembers are using the budget to impose their hierarchical morality agenda. (03:52:45) There being no more speakers, Mayor Strickland closed the Public Hearing. Councilmember Kalmick thanked staff for their efforts in providing a balanced budget and shared his opinion the rushed process since May is a disservice to everyone. He further shared his belief that the City is not being funded at appropriate levels for world-class services. He noted the challenge of revenue increasing by 2 percent through property taxes while the cost of goods can triple or quadruple, and shared his concerns about the 2025/2026 budget currently projected at being upside down at $4.5M – $5.7M. He stated support for continuing the Circuit program, and suggested staff be asked to direct some one-time dollars to buy time and provide an opportunity to back-fill with anticipated State dollars. Councilmember Bolton stated support for Councilmember Kalmick's comments and shared her opinion this chaotic process is a disservice to residents. Councilmember Bolton and Acting Chief Financial Officer Han discussed budget line items in greater detail related to potential fees, fines and penalties related to the Housing lawsuit. Councilmember Bolton stated her opinion that Council decisions related to housing and the Airshow are putting the City at financial risk, and her expectation that moving forward residents will be provided ample opportunities to provide budget input. Councilmember Moser shared her concerns regarding the chaotic and compressed timeframe for the budget process; continuing the Managed Hiring Process; employee turnover and loss of institutional knowledge; no budget cuts and increased costs in the City Attorney's Office; Airshow settlement and CEQA EIR costs; financial ramifications from not having a certified Housing Element; eliminating the Community Café Forum unless sponsors and donors step forward; and her support for libraries and the many services they provide. She stated support for proceeding with the 2023/2024 balanced budget and allowing for more public input moving forward. City Council/PFA Adjourned Regular Meeting Minutes June 26, 2023 Page 10 of 13 Mayor Strickland explained that after the POA Agreement was passed by a Councilmember vote of 7 – 0, the reality of the budget impact became apparent, and in early June he asked staff to engage Department Heads in balancing the 2023/2024 FY Budget, plus two years. Mayor Strickland emphasized that any proposed budget cuts during this process were provided by staff and were not Councilmember recommendations. He added that when it became apparent to staff that some of the budget cuts would not be supported by Councilmembers, they came forward with the budget presented today. Mayor Strickland stated that if his amended motion is approved, there will be a $6M surplus next year vs a $7.4M deficit if Council does nothing. He shared his opinion that fixing the budget today is preferred to waiting for an emergency situation to develop which could limit options, and noted many economists are predicting a recession for next year. Mayor Strickland commended Acting Chief Financial Officer Han, City Manager Zelinka, and Department Heads for providing accommodations to create a budget which is good for maintaining services, good for the taxpayers, good for Huntington Beach, and a good financial path for the next two years. Councilmember McKeon cleared up the misunderstanding expressed by many that the City's budget shortfall was caused by the Airshow settlement. He clarified the actual settlement amount was $4.9M with a $1.9M payment made this year and the remaining amount will be paid in increments of $500,000 over the next six years. He confirmed with Acting Chief Financial Officer Han that the $500,000 payments over the next six years are incorporated in the presented budget numbers for the years indicated. He added that litigation with the oil company responsible for the leak is still pending. Councilmember McKeon confirmed with City Attorney Gates that of the 40 current active lawsuits, two are housing lawsuits, plus the Petition for Review submitted to the Supreme Court. City Attorney Gates stated that most of the lawsuits handled by his office relate to defending the good work of the Police Department, public property and vehicle accident cases. City Attorney Gates added that he has never requested funds for an office remodel, and has no idea where that information originated. Councilmember McKeon clarified for the record that no libraries are being closed, nor are hours of service being reduced; cuts are not being made to Senior Center hours, tree trimming, beach restroom cleaning, Call Center staffing, Park Rangers, Edison and Murdy Park hours, Downtown power washing, Pier Plaza, Blufftop and Sunset landscaping, nor Code Enforcement Technician and Economic Development Manager positions. City Attorney Gates clarified there will always be unknown costs with litigation, and stated that when work is done in house, the lawyer costs for their time does not increase with additional lawsuits. He added that if it becomes necessary to involve outside counsel, there are additional costs incurred. In response to a request made by Councilmember Bolton, City Attorney Gates agreed to provide her with a complete list of active litigation cases. Councilmember Kalmick stated he believes there are lawsuits which take hardly any staff time, and others that may utilize a lot of staff time. He stated that the City Attorney's Office requesting four more attorneys is a problem for him and many residents. City Attorney Gates replied that there are less than five cases where the City is a plaintiff, and the City is a defendant for the remaining cases, and that he is only asking for one more litigator. City Council/PFA Adjourned Regular Meeting Minutes June 26, 2023 Page 11 of 13 Councilmember Kalmick stated he does not believe staff had the time to do a thoughtful dive into the budget which could take a year. Councilmember Kalmick and Mayor Strickland further discussed whether or not it is necessary to make cuts tonight for funds that might not actually be needed until FY2025/2026. Councilmember Kalmick stated his objections to the fact that not even staff has a copy of the Airshow settlement, and in his opinion the information that has been made public is missing substantial information that the public needs to see. City Attorney Gates clarified there are a host of reasons the Airshow settlement is not yet a public document, the number one reason being pending litigation, and there is no requirement to disclose a document that may impact pending litigation. Secondly, he explained Councilmembers are aware there is some additional information in the settlement which is not part of the final settlement that results in the dismissal. He further stated he will not take any action that deviates from what the law requires him to do that could ultimately compromise the City, but noted if instructed by a judge to release more information, he will oblige and also noted that he has the support of other attorneys for this position. Councilmember Kalmick asked for clarification, and Mayor Strickland confirmed, that no changes are being made to the City Attorney's budget. There was Councilmember agreement to move the Circuit program to Level 2 Budget Reductions (January 1, 2024) to allow time to secure anticipated funding. A motion was made by Kalmick, second Bolton to approve the budget proposal first presented on June 6, 2023; adding revenue sources more recently identified; removing the FTE positions for the City Attorney's Office; and providing Budget Study Sessions over the next few months for resident input regarding the 2025/2026 Budget, including discussions on additional revenue sources. The motion failed by the following roll call vote: AYES: Kalmick, Moser, and Bolton NOES: Van Der Mark, Strickland, McKeon, and Burns A substitute motion was made by Strickland, second Burns to adopt Resolution No. 2023-24, "A Resolution of the City Council of the City of Huntington Beach Adopting a Budget for the City for Fiscal Year 2023/2024" (Attachment 2) as amended to include the impacts of the Police Officers' Association (POA) MOU, additional parking revenues, and revised Budget Balancing Plan as amended (N); and, authorize the Professional Services included in the FY 2023/24 budget to be representative of the services projected to be utilized by departments in FY 2023/24 (Attachment 3); and, authorize the appropriation and transfer of the full balance ($4.9 million) of the AES Reserve from the General Fund to the AES Mitigation Fund 1284; and, authorize the appropriation and transfer of $3,903,803 from the General Fund Equipment Replacement Reserve to the Equipment Replacement Fund 324; and, approve the return to a 12 year paving cycle; and, adopt Resolution No. 2023-25, "A Resolution of the City Council of the City of Huntington Beach Establishing the Gann Appropriation Limit for Fiscal Year 2023/2024" of $1,171,687,773" (Attachment 4); and, adopt Resolution No. 2023-23, "A Resolution of the City Council of the City of Huntington Beach Levying a Retirement Property Tax for Fiscal Year 2023/2024 to Pay for Pre-1978 Employee Retirement Benefits" (Attachment 5); and, adopt Resolution No. 2023-27, "A Resolution of the City Council of the City of Huntington Beach Amending the City's Classification Plan by Adding the Classifications of Graphic Designer, Multimedia Coordinator, Homeless Services Manager, and Municipal Records Manager" (Attachment 6); and, adopt Resolution No. 2023-28, "A Resolution of the City Council of the City of Huntington Beach Adopting a Revised General Fund Reserve Policy" (Attachment 7) and authorize the City Manager or designee to execute all City Council/PFA Adjourned Regular Meeting Minutes June 26, 2023 Page 12 of 13 administrative and budgetary actions necessary to consolidate certain General Fund Assigned Fund Balances to the Economic Uncertainties Reserve in order to meet the City's two-month Emergency Reserve requirement; and, adopt Resolution No. 2023-26, "A Resolution of the City Council of the City of Huntington Beach, California Acknowledging Receipt of a Report Made by the Fire Chief of the Huntington Beach Fire Department Regarding the Inspection of Certain Occupancies Required to Perform Annual Inspections in such Occupancies Pursuant to Sections 13146.2 and 13146.3 of the California Health and Safety Code" (Attachment 8); and, approve and authorize the Mayor and City Clerk to execute "Amendment No. 2 to Agreement between the City of Huntington Beach and Mind OC for Pilot Mobile Crisis Response Program" (Attachment 9); and, approve and authorize the Mayor and City Clerk to execute "Professional Services Contract between the City of Huntington Beach and National Council for Community Development (NDC) for Technical Assistance Services" (Attachment 10); and, approve and authorize the Mayor and City Clerk to execute "Professional Services Contract between the City of Huntington Beach and Hinderliter, De Llamas and Associates for Sales and Use Tax Allocation and Audit Services" (Attachment 11); and, approve the Budget Balancing Plan to proactively address the Fiscal Year 2024/25 Projected General Fund Deficit; (Attachment 12); and, as amended move Budget Reductions identified in Level 1 to Level 2 per revised Plan: 3) Circuit (replace General Fund subsidy with user rate adjustment, ad revenues, vendor funding, or other alternatives); and Level 2 to Level 1 per revised Plan: 2) Reclassify Multimedia Officer to Multimedia Coordinator, 4) Reduce Various Public Works contract and maintenance budgets, and 6) Community Café Community Forum (costs for consultants, food and supplies only; continuation of event with sponsors, donations, and in-kind); and, authorize staff to meet with labor associations on modifications identified under Level 1 per Revised Plan: 2) Employee Work Enhancements; and, approve modifications to the frequency of selected Boards and Commissions ("BCCs") and direct staff to update Municipal Code Section 2.100, "Operating Policy for Boards and Commissions," to formalize a process for BCC directed assignments exceeding four (4) hours of staff time. as amended to defer to the Boards, Commissions, Committees (BCC's) Ad Hoc Committee. The substitute motion carried by the following roll call vote: AYES: Kalmick, Moser, Van Der Mark, Strickland, McKeon, Bolton, and Burns NOES: None Sunny Han, Acting Chief Financial Officer, noted for clarification that Recommended Action, Item A, is amended to include the impacts of the POA MOU, the additional parking revenue, and Revised Budget Balancing Plan; amended Item N for moving Items #2, #6, and #16 from Level 2 to Level 1; and authorizing staff to meet with Labor associations for modifications to Employee Work Enhancements (Level 1, Item 2) and considerations to keeping City Hall open Monday through Friday. ADMINISTRATIVE ITEMS 4. 23-568 Adopted Resolution No. 2023-32 Approving and Implementing the Memorandum of Understanding (MOU) between the Huntington Beach Police Management Association (PMA) and the City of Huntington Beach for July 1, 2023 through June 30, 2026 Theresa St. Peter, Interim Human Resources Director, and Travis Hopkins, Assistant City Manager, presented a PowerPoint communication titled Consideration of the Proposed Memorandum of Understanding with the Police Management Association (PMA) with slides entitled: Overview; Proposed Memorandum of Understanding; Fiscal Impact; City Council Options; and Questions?