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CITY OF DIAMOND BAR CITY COUNCIL AGENDA
April 02, 2019
Next Resolution No. 2019-06 Next Ordinance No. 03(2019)
Public Comments is the time reserved on each regular meeting agenda to provide an opportunity for members of the public to directly address the
Council on Consent Calendar items or matters of interest to the public that are not already scheduled for consideration on this agenda. Although the City Council values your comments, pursuant to the Brown Act, the Council generally cannot take any action on items not listed on the posted agenda. Please complete a Speaker's Card and give it to the City Clerk (completion of this form is voluntary). There is a five-minute maximum time limit when addressing the City Council.
Staff Present: Dan Fox, City Manager; David DeBerry, City Attorney; Ryan McLean, Assistant City Manager; David Liu, Public Works Director; Greg
Gubman, Community Development Director; Dianna Honeywell, Finance Director; Anthony Santos, Assistant to the City Manager; Christy Murphey, Recreation Superintendent; Marsha Roa, Public Information Manager; Cecilia Arellano, Public Information Coordinator; and, Tommye Cribbins, City Clerk.
Forecast that meets the City Council s strategic goal of Responsible Stewardship of the Public s Resources. This 10-year forecast of the General Fund
is consistent with City Council decisions over the past couple of years related to fiscal sustainability, study of the special events subcommittee, and reduction of other subsidies in transit programs, etc. This is a tool to help the City make proactive and prudent, budgetary decisions for long term.
decisions. The City has revenues coming in which was the foundation for building a reserve that at one point reached 32 million. Next month the City
will celebrate its 30th birthday. The City has new amenities such as the Diamond Bar Center, City Hall/Library, improvements in infrastructure and capital projects, expanded programs and services, and with each of those they provide greater value to the community as well as, come with a cost which is generally long term maintenance and operations costs. With that, the reserve has been drawn down to expand those
services and build those facilities. After mid-year, the unrestricted General Fund Balance is at about 16,500,000 and the City is beginning to see
the impacts of that growth as it transitions to a more maintenance-oriented community. Revenues are now expected to be outpaced by expenditures and by continuing that pattern the City can expect a deficit unless the Council makes a decision to offset some of those expenditures. Prioritizing expenditures and prioritizing capital improvement
Diamond Bar and one of the issues is that as a primarily built-out city, Diamond Bar has limited sales tax growth opportunity. There have been 10
straight years of growth which exceeds the 6 or 7 year threshold of economic downturns forecasting that it is likely that within this period there will be a slow down or a down turn. The City is also very reliant on the sale of fuel. Of the City s top 25 generators of sales tax revenue, 44 percent are gas stations and when there are variances in gas prices the City feels it which means that diversifying the City s tax base is something for the Council to look at. New development has included the Sprouts Center providing residents with new shopping opportunities, improved aesthetics, etc. However, looking at the Sprouts Center as a revenue generating standpoint, what the City realizes from the sales tax revenue is not enough to pay for a single deputy, as an example.
expected to be fully funded with special funds (SB1, Measure M) which will not impact the General Fund. What is left to be funded are the park
development projects, some of the maintenance projects and renovation projects which are currently unfunded. If those projects were to move forward at this point, any grant funds that may become available in the future, would have to be funded with General Fund Reserves. The Council has not approved those projects and has the discretion and authority to determine which of those projects would move forward. The total of the assumed unfunded projects amount to a little more than 12 million.
Council has a reserve policy mandatory minimum of 4.5 million for emergency contingencies. If all projects were funded, three years out the balance
would be below the minimum. Staff recommends that the City Council revisit this policy to make adjustments to raise the minimum or setting up different funding requirements for some of the side funds. Research indicates that the mandatory minimum reserve policy was adopted in 2011 and was intended to represent three months of operating income.
INCREASING OPERATIONAL AND MAINTENANCE COST As the City has
grown and as it has offered more facilities such as the Diamond Bar Center, the City Hall and Library, while attractive and well-used facilities, in
order to keep those facilities at their current level the City has to invest in maintaining that level and it is likely the Council will need to consider prioritizing future maintenance/upkeep projects as opposed to constructing new facilities.
to 7 percent, which meant they were expecting lower returns on investment which leads to an increase in the City s percentage. In addition, CALPERS
has introduced a mandatory payment on the unfunded liability which is the amortized amount to fund benefits for current members. The City s current UAL and funded accrued liability is about 5.6 million. All cities that are in the plan at this point are on a 30- year amortized schedule with options to go to a 15 year. Currently, all participants default to the 30-year schedule which means the City will be making an additional payment as part of the budget going forward. Because the City is 30 years old, it has more employee members that have been participating in CALPERS which factors into increases in liability.
City is in year three of the plan and there are a lot of items queued to be finished, many of which are labor intensive. Staff is not proposing to
add anything this next year. In his view, staff and the Council will have their hands full this year to finish what has been started and next year will be the beginning of developing the next three-year strategic plans.
Staff Present: Dan Fox, City Manager; Ryan McLean, Assistant City Manager; David DeBerry, City Attorney; Ken Desforges, IS Director; David Liu,
Public Works Director; Dianna Honeywell, Finance Director; Greg Gubman, Community Development Director; Christy Murphey, Parks and Recreation Superintendent; Anthony Santos, Assistant to the City Manager; Marsha Roa, Public Information Manager; Alfa Lopez, Senior Management Analyst; Cecilia Arellano, Public Information Coordinator, and Tommye Cribbins, City Clerk.