Recommendation to receive and file the Fiscal Year 2014 Year-End Budget Performance Report, and increase appropriations in several funds across several departments for various purposes to reflect final expenditures.  (Citywide)
Thank you. Next item, Madam Clerk. Item seven Report from Financial Management Recommendation to receive and file the fiscal year 2014 year end budget performance report and increase appropriations in several funds across several departments for various purposes to reflect final expenditures citywide. Thank you. I know, Mr. West, you wanted to make a report on this, and then we have a motion. Well, go ahead and make a report. And then I have Councilwoman Pryce, first mayor, councilmembers. A brief report by our budget manager, Lee Erickson. Good evening, Mayor and City Council. This is the year end performance report for FY 14 for the period ending September 30th. It reports on our performance for the fiscal year and also includes a few technical technical adjustments. Generally, this report is good news. Citywide urine spending came in under budget appropriation, including for the general fund. Also in the general fund, revenues did exceed estimates. Overall, the general fund had a 3.2 million surplus, and this is in addition to the $5.5 million of surpluses which was already set aside for CalPERS stabilization fund. Also, there was a $3.5 million surplus in the Uplands Oil Fund in accordance with City Council policy. The city manager is proposing that 5% of the surplus in both the general fund and uplands be set aside for unfunded liabilities. Other proposals include the establishment of an innovation and efficiency initiatives revolving fund, and if that is approved, the mechanics of that fund will be brought back to the Budget Oversight Committee for review and recommendations. As this idea was generated in part at the BMC in the fall. A variety of other proposed uses are also recommended, including the special election in district for the Bloomberg team match. Setting aside funds to build a two month uplands oil reserve and implementation of the pavement manner management plan. There would be there will be a study session on the pavement management plan scheduled hopefully for some time in March . Lastly, there are three technical adjustments, as I mentioned before this, and they're all offset by revenues. So this concludes the staff report and I'm available for any questions you may have. Thank you. Let me go to Councilwoman Price. I actually want to make a motion in regards to this item, and I want to. Make a have a modification to the proposed. Proposed plan for the use of the expenditures. Would this be an okay time to do that? Yes. Okay. So I would like to reduce the $2 million that we have allocated for innovation and efficiency initiatives. And with that $2 million, I'd like to reduce that $2 million to $400000 to allow some seed money there. Put 500,000 in reserves. Allocate 900,000 for infrastructure to be divided by the nine districts. And allocate $200,000 to the Long Beach Fire Department to invest in their search program. Did you want to? That's the motion, correct? Okay, great. Counts Councilwoman Mongo. I appreciate the additional funding to our reserves. I think that this is a great investment. Also, the next big emergency could be any day. And I think that ensuring that our CERT program is properly funded, we've heard time and time again Council member Urunga and I attended the CERT Citywide event in the in Hartwell Park several months ago, and the program is in dire need. And I worry that if we don't invest, we might not have what we need to make sure to shelter in place for seven days. My district use recently has undergone several outages and we have realized how completely unprepared our communities are for an upcoming emergency. So I appreciate the emotion as stated. Thank you, Susie. 200,000. The fire department needs 300,000, but we're going to help them with an independent fundraiser to raise the other hundred thousand. Okay. Thank you. That's been the motion to the second next have council member Austin. Thank you. Can you repeat the emotion again and how you wanted to allocate that? We allocate this or we propose to do so. Absolutely. And I hope that the numbers added up, but I'll go again slowly. So $400,000 seed money, which is for the innovation and initiative efficiency initiatives from the 2 million reduced to 400,000, so that there's still some seed money there for staff to have the opportunity to pursue some of those initiatives. Right. 500,000 for to go into reserves so that we've set some money aside, 900,000 to go into infrastructure to be divided by nine, and then 200,000 to go to the fire department to help with their cert program. I do want to point out that with the one time funds that we've received and reallocated, we have been able to provide a lot of resources for the Long Beach Police Department, and so it would be nice to invest in public safety a bit further and provide some of those additional resources to the fire department. They too have had major impacts to their budget. So this is something that they can do with one time funds. And of course, we all have infrastructure projects that are a major priority in our our districts and not knowing what the future infrastructure, budgets and divide by nine opportunities will be. I think this is a good way to allocate some cost savings that staff has been able to to together generate over the last year. So first of all, I think this is this is welcome news and this is a good problem to have, not a problem at all to have a surplus and extra resources to work with. I am going to be supporting your recommendation for the how to to to to allocate these resources, because I think it's important that we we do invest in our infrastructure, continue to do so until you have crumbling sidewalks and curbs and we need street repairs and we can never put enough money into infrastructure. That as a matter of fact, I mean, would that work? You know, we had a robust study session on medical marijuana. I would venture to guess that the vast majority of our residents in the city would love to have love us to have a study session on how we're going to fix the infrastructure in this city. And so this extra $900,000 divided by nine well will serve our districts well. And the vast majority of our residents will. The Innovation and Technology Fund we in fiscal year 14 and one time funds we put aside I believe, $200,000 for toward that. This bolsters that that that fund even more by adding an extra 400,000. I agree $2 million might have been a little little lofty in terms of that expectation. But the 400,000 innovation going to that, I will completely support the I do see on this a $200,000. Allocation from uplands for an attorney for labor negotiations. And that's that's questionable because I think we have a great city attorney's office and I know we have individuals who are our subject matter experts on labor negotiations. And so I'm I have some questions about that, that allocation, particularly because I don't think there's a whole lot of money on the table for labor negotiations and we're going to give $200,000 to the lawyers say no. I mean, you can pay me ten bucks to say that. I mean, it's it's going to be easy to do. I don't know that that that's that difficult or worth that investment. And and I'm glad to see us. I think overall, this is this is a balanced, balanced document with those corrections. So I will support the the motion on the floor. Okay. Thank you, Councilmember Richardson. Thank you, Mr. Mayor. So just a few questions. And so first with this innovation fund. So I see there's 2 million added here. How does this add to the 600,000 that we already discussed? Mr.. Mr.. MODICA Mr.. West, I'm going to turn that. Over to Mr. Modica and Mr.. Malik, if you can also address. Let me you know, let me complete the whole question and then we get a whole answer from you. I know we did. 600 K is that represented here? And this is us tidying that up because I know we talked about like the purpose for this fund, like some funds were going to go to that the Bloomberg match . But we also wanted to have a body of dollars as a revolving fund to incentivize departments. Help me understand this. Yes, sir. Mr. Mayor and Councilmember Richardson and members of the council. So what you voted on last week was to authorize us to to enter into an agreement with Bloomberg and to provide up to $1,000,000 with the match. The money that's in front of you tonight is actually those funds that you already said you're going to commit. So we were going to pay for the $1 million match with $400,000 of these funds. Plus, there was going to be a $2 million infrastructure I'm sorry, innovation and efficiency reserve, of which up to 600,000 would be used to to fund this implementation. And so, as I understand the motion tonight, you know, there isn't any other innovation and technology money out there. We don't have $200,000 set aside. What we would have would be $400,000 with a fund balance and 400,000 of the energy and efficiency, leaving us $200,000 short for our commitment for a Bloomberg Innovation Fund, which would have to be funded out of next year's budget. So how would that jeopardize our opportunity to have that Bloomberg grant? Well, the Bloomberg grant, we we will have committed to that. So that will be a commitment. We will just have to identify that fund somewhere else. We have two years to identify the funds so we could either get $200,000 back tonight or we would have to budget that in the next fiscal year and identify those resources to meet our grant obligations. Okay. So we set aside 400,000 that's represented here. And then the idea was because we would establish this fund 600. I know we had this conversation last week or last council meeting when we talked about the Bloomberg fund, and that's why I noticed these things. So so we would need at least $600,000 in the Innovation Fund in order to do what we attempted to do last week. Yes. If you wanted to fund it this year, yes. You would need 600,000. Correct. Okay. And can you just elaborate on the purpose of the innovation fund? So the Innovation Fund was something that has been talked about in last year's budget but wasn't funded, was talked about by the Budget Oversight Committee and staff, was requested to come back. And the concept is to create a revolving fund. Often in departments. We have innovative ideas. We got a lot of things that need to get funded, but there's not a funding source to front the money in order to implement the savings. And so that was the idea of this fund. Is there a concrete example? Yes, I can give you an example. For example, it could be investing in energy efficiency. We've seen a number of projects where if you put in an h-back system for a two or $300,000, you can save several hundred that or several thousand dollars each year in terms of energy efficiency, water efficiency, irrigation improvements, we're even looking at things like fiber for revenue, putting in city fiber and seeing if we can and, you know, make money off of putting in city fiber. Those would be some examples. Okay. I think that makes sense. I got to before I move on, I got a question. Councilmember Price, I want to I want to understand how you arrived at the number 400,000 for innovation. Well, and I have to say, I talked with the city manager about this yesterday, and I'm learning some new information tonight because it wasn't as clear to me yesterday. My understanding was the 400,000 that we had already allocated for the Bloomberg grant that was going to be part of three payments over the quarter, not payments, three match . Amounts over a three year period. Correct. And that the $2 million that we had put in this was to encourage staff to come up with innovative and different ways to apply for grant funding, etc. that would help them be more efficient and innovative. And that's why, to me, $2 million for that process at a time when, you know, we have so many other needs, I guess seemed a little bit high. So if if, if, in fact what Mr. Modica said is, is accurate, we may want to and I'd be totally open to if somebody wants to make a friendly. I still got the floor. Okay. I know. So, so just so where I came up with that 400,000 is that that give them some. See I thought that was seed money to encourage staff to apply for different grants. That's what I thought it was. So if we want to make that 600, then we can take, you know, potentially from the reserves and make that 600 and maybe even fully fund the fire department's cert program at 300 and just have less money for reserves. But that's just a thought. Okay. So I think there might need to be some adjustments to this innovation fund, particularly, one, we need to make whole the $600,000 commitment we voted on. And then if we if the idea is to invest another 400,000, then that would need to be a minimum $1,000,000 to make that whole our past commitment. And then what we want to do today. Then I would say this reserve here, which reserve is this out being allocated to. This half million dollar reserve proposal. Well now? Well, it depends on what that amount is, but it would go into the General Reserve. So which reserve would you place? The same as a city manager? Well, we've got a number of reserves. Lia. That's an unfunded liability. Right now we are reserves are actually within the financial policy limits. We do have several of them. So we have an operating reserve. We have an emergency reserve. We have our CalPERS stabilization fund. We have unfunded liabilities. Or we could leave it in the general fund in funds available, and that would also count towards our total reserves . So we so we have a number of reserves that I mean, our obligation, our reserve obligations are healthy. This. So would you we're you saying that you want this to go into pension stabilization fund or General Reserve. So the 500,000 that we currently have as the recommendation by staff, we would just add to that so that we would have whatever, whether it's a million or 700,000 if we decide to. You mean the uplands reserve oil? Flic flood fluctuation, up to 2,000,002 months reserve. Remaining ending funds available. So so that's not a reserve. Those can be allocated tonight. So those aren't. The 500,000 that we would have left over. Yeah. So. So this is not a reserve. So this is allocate we can allocate that tonight. So you're saying that's the funding that you want to place in to the reserve? Now. Leah, can you explain that? Do you understand what I'm trying? Here's where I'm at. I've. I've added up. Hold on. I understand where I'm going. Let me get there. There's $400,000. That was a proposal to innovation. There was $500,000 to a reserve. There was $900,000 to. What is this? Infrastructure. I mean, we've got $200,000 for cert. That's $2 million. Now, that was in lieu of the innovation and efficiency initiatives, $2 million. That means this 500,000 that's at the bottom that we can allocate tonight is still on the table. That's correct. That's not allocated to a reserve. Well, it is it is referred to as a reserve. If I if you're asking me a question and I'm referring to Lia to answer that question, because she just answered, I. See those as unallocated dollars. Yeah. A reserve is something we're specifically intentionally reserving for purpose. I think we're just calling them different things, but thinking about the same the same pot of money. I mean. When I think about when I think about a reserve, we've got our pension stabilization fund, we've got a number of reserves, as Lia mentioned, with different purposes. So I think if we talk about a reserve, we need to be specific. So I would just. Move on from there. So I'm going to I'm going to say that I would like to offer a substitute motion. And before I do that, how do we arrive it like I'm a cert graduate. I went through it with my wife. Support that program. How do we arrive at $200,000 is the number they need. The chief says they need 300,000. And if, in fact, we were willing to move the numbers around a little bit, I think there would be support to fund them at the full 300,000. I think council would like to do that if we can find a way to do that. I get it. So so the issue I have is typically I like to get budget requests from department heads through the city manager in the by agenda so that we have the opportunity to talk with them about this. I haven't heard of any need from for this for cert. I know that we had a conversation a while back about saving this CERT coordinator position, and there was a lot of discussion about that. And what they ultimately decided to do was they found other grant funds to keep that program going. So what was the specific purpose for the 200 or $300,000 that we allocate tonight? Will allow them to fully fund their cert program. Is. Is anyone here from the fire department? I'd like to better understand what that means. My understanding was, I mean, they have one position. A mayor and city council, Rich Brant, deputy chief, actually saw programs under fire prevention. Actually, we don't have any more grant funds. We are funding our CERT coordinator currently out of our budget the best we can. With the recommendation of the city manager. What we're trying to do is move that into a civilian spot where I can get somebody in who can coordinate number one. And number two is we're working with Cal State Long Beach right now and their emergency management program to try and get some interns as well. We have over. 400 people on a waiting list. Plus, we have numerous high schools that need to serve programs as well. We just don't. Have the resources to be able to train. Those people at. At. Our current levels. So you want to utilize this, too, so you don't. So the coordinator position that you currently have. You don't have funding so you're making do you use this in relief to could support that position as well as internships to move your program? That's part of it, yes. And then we also have resubmitted a U.S. grant for U.S. grant funding because of the containers that we're going to put in each district that are going to fund our resources and our materials that we need for our people. To respond. In case of those types of emergencies where they can take care of their neighbors for at least 72 hours prior to us getting there. Thank you, Deputy Chief. So the the issue that I take with that is that we don't fund positions with one time dollars and we do through overtime with PD. But this is a slippery slope. If we get into there's a position that was grant funded and we're going to use one times to extend it. Now we're getting into system support. We're calling a program ongoing through one times when that's not necessarily the case. So I think that's an inconsistent fiscal policy that we shouldn't necessarily do that. However, if we had a commitment from the fire department that this is not going to support positions, I think there is a place where we can help support this program without saying this goes to full time positions and FTE within the department. So I'm going to make a substitute motion to make the Innovation Fund at $1 million by taking this $500,000 reserve in place and into placing it into innovation. I'm going to take this cert $200,000 and I'm going to offer 1000 $100,000 to help support that program. And then the remainder remainder which it should be $600,000, which is the $500,000 as unallocated plus the $100,000 we have from CERT. I would ask that we take that and divide that $600,000 by nine, and that would be my motion. Oh, that's in addition to the $900,000 already and into this infrastructure fund. So right. So we're now we're at 1.5 million for infrastructure. We're at we're at 1.5 million for infrastructure. We're at $1 million for innovation, 1.4 million for infrastructure, $1 million for innovation and $100,000 for cert, a total of 2.5 million to be consistent with what we have. So that's my motion. Okay. There's been a motion by counsel or is there a second on the motion? There's a second. Councilman Austin, did you want to speak to your second or over speaker's list? No. Okay. Vice Mayor Lowenthal. Thank you, Mr. Mayor. I wanted to ask the city manager just a question about the Bloomberg fund, and then I wanted to address the motion. Is is that funding coming through today? Tom. So I'm sorry, could you restate the question? Is the funding coming through today? Yes. What's the status of that funding? Oh, the Bloomberg funding. So, yes, we do have $3 million committed. We are we've got the authority now from council to execute the grant agreement, and we're waiting for the actual grant agreement. Then we'll sign it and then the funds will be available. The $3 million, which is 3 million over over three years. Okay. Thank you. I appreciate that. I was also trying to. Councilmember Richardson, I think your substitute substitute had us overfunded by 400 unless you were looking at the remaining ending funds available. I'm not sure. Yes. So early. Earlier I checked with the city manager about that money and that is available for our purposes tonight if needed. Okay. I appreciate that. Well, I'd like to make a substitute substitute motion and. Take $600,000 for seed money for innovation and technology, 200,000 for the reserve, as Councilmember Price mentioned, 900,000 divided by nine and to fully fund the 300,000 to the CERT program. And Councilmember Richardson, you're correct in that we don't utilize one time dollars for ongoing expenses. I do believe we've done so with gap funding, especially for grant funded programs. And I can and and I take our policy. Initiatives very seriously, our especially your budget policies. And I do believe we should not use one time dollars for ongoing expenses, but I consider this gap funding and I'm comfortable with that. And so that's my substitute substitute motion, which I believe Councilmember Price is what you would articulate it earlier. So I have to make it. Okay. So there's been a motion and a second, and I just want to make sure I understand the motion. Right. I'm going to restate this whole thing and have staff restate it for us so that we're all on the same page. Can we restate the motion? And so that we know that and let's answer the questions that were raised and kind of lay out what vice mayors propose. Please. So, Mr. Mayor, the substitute substitute motion would be to to leave $600,000 in the Innovation and Efficiency Initiatives Fund, which would free up 1.4 million. And that 1.4 million would be allocated 200,000 to the CERT program, 900,000 to divide by nine. I'm sorry. Sorry. Reserves and then 300,000 to the CERT program. Okay. Hold on. Hold on 1/2. So there's only one person who has a floor. So Vice Mayor Lowenthal has the floor. I just have a question, Vice Mayor, if you don't mind, I what I want to make sure, because now I'm a little bit confused, is that the Bloomberg Innovation Fund is as whole as per the grant process that we went through last week. And so in the motion that that the vice mayor is making is the Bloomberg Innovation Fund Hall. Yes, we believe we have $1 million, then set aside 600,000 of which would come from the Innovation and Efficiency Fund. And 400,000 is as part of the item in front of you tonight from from ending fund balance for a total of $1 million. Okay. And that's and I'm glad you clarified that, Mr. Mayor. That's why the ending fund balance I don't view as being on the table in that regard, because as part of the Bloomberg are set aside for Bloomberg funding. And so so you articulated it correctly, is that it would leave that intact as my belief as well. Okay, great. And so now I have a motion and a second on that substitute. So I'm going to go to Councilman Mongo and then I'm going to go to the speaker's list. Councilmember Lowenthal I mean. Vice Mayor Lowenthal. So just to clarify, because I know there was some questions about operating reserve versus unfunded liability reserve and the 500,000 that might be the variance right now. 900 for infrastructure. Correct 304 cert. That puts us at 1200 600 for innovation. That puts us at 800, which gets us to the full million. That leaves 700 unallocated of the 2.5 million. So the 700 would be the unfunded liability reserve to get us that to the to 2.5. So we're not going to leave the 500 in the operating reserve. We're going to move it into the unfunded reserve, which is in the first line of the budget list. I'm going to look to Miss Eriksen, because in that calculation, I'm not sure that we we fulfill what Mr. Modica said. We did. Sorry, Madam Vice Mayor, we are fine with the Bloomberg grant. The remaining ending funds available is considered part of our total combined reserves, so it can remain there and there would be 700,000 left there and that would just be part of our total combined reserves. Thank you. So so, Councilmember Lowenthal, would you be open to slightly reducing the reserve and increasing the infrastructure to find the middle ground between the original amendment and the. Substitute amendment. Yes. Okay. Would we be comfortable with 500,000? You wanted to shift 500,000. Okay. Shift 500,000. So that would be 1.4 to infrastructure 600 Innovation 300 ASSERT and the remainder to the unfunded liability reserve. Yes, great. Okay, good. We have a motion on the floor, which I think we all understand. Councilman Price. Okay. Can't remember us. Well, what happened? Council member. Okay. Vice marathoning for you. Did you come back in? Okay. I'm confused. Got some free Ringo. Oh, I really love our discussion and especially the. The addition of infrastructure funds, but I think we should use some street repairs. But what I'm mostly concerned about at this point is I know we're adding these funds to the CERT program and and there were some other programs that we discussed earlier this year, like the Language Access Program that isn't addressed here and don't know. We were talking about finding some funds for that and I don't see that here in this budget and I'm not prepared right now to tell you how much it needs, because if I recall correctly, it was about 350,000. We we funded it up to about 225, if memory serves me right. So I would like to see that that program fully funded and take off on that. And also, in terms of the of the state program, we did go to that to that to that training. However, I did not see any kind of preparation for bilingual people on that. There's no there are no there were no speakers in Combi or in Spanish or any other language. So I would encourage the fire department to, uh, to use those additional funds that they're getting tonight to look at finding some translators or training for bilingual folks in that program, knowing that we have a very diverse community in Long Beach, some who would need the language services available as well. So please look at that as well. Okay. Thank you, Councilmember Richardson. I'm good. Okay. Mr. Modica. Just a clarifying question for Councilmember Mongeau. She was originally talking about putting $200,000 to ending fund balance, but in her last motion said $200,000 to the unfunded liability reserve. Can we get clarification on which one is correct? Mr. MODICA That was actually mine. Oh, excuse me. Vice Mayor Lowenthal, did you want to clarify that or. Your question was too shifted? It appeared that the $200,000 would be the ending fund balance. So that would be left over in our budget as a small amount of $200,000. I also heard that the $200,000 should go to the unfunded liability reserve. Just a clarification on where that 200,000 should go. So I think it would be wise to if we're able to hold it in operations until close of of filing is that. Yes, we would recommend that it would we would have a minimum of that $200,000 and ending fund balance. Okay. Thank you. Thank you. Okay. There's a motion on the floor. Any public comment on the item? Please come forward. Very good. You click as the aggressor. I'm glad the councilman pressed accountable on the price, pulled this off. I had to circle it. Actually, the first thing was more technical. When you have something like this and you can check with the city attorney and work it out with the city clerk. But I don't think this should have ever been said. Recommended to receive and file something like this for sale and receive or adopt. I think would have been a better word. Ordinarily, things that are received on file or not as important decisions. Clearly this is given the dollar amount in the appropriate discussion. But if my understanding is correct, also, this is a work this is based upon based upon the fact that the Mr. Bloomberg is willing to underwrite what some people already do and others may, such as the ninth U.S. Circuit Court and also James Comey's organization to underwrite what some people might rightly view as Tammany Hall West. Right. I would suggest holding off until you have the check in hand or the funds in the bank. If for some reason they do not approve it. Because that would mean you would have to come back and do some readjustments. It just doesn't make sense to commit to a project or to say this is what you know, to commit to a project until you had the cold, hard and ready in your hands or in the bank. Thank you. When I go to a vote. Members, please cast your vote. Motion carries seven zero. Item number eight. Item number eight report from Financial Management. Recommendation to approve the fiscal year 2015 first departmental and Fund Budget Appropriation Adjustments in accordance with existing City Council policy citywide.