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HomeMy WebLinkAboutFC_2009-08-24_Minutes Finance Committee Notes Monday, August 24, 2009 9:00 a.m. Atascadero City Hall 6907 El Camino Real, Atascadero, California Members Present: Mayor Ellen Béraud, Mayor Pro Tem Roberta Fonzi, City Manager Wade McKinney, Administrative Services Director Rachelle Rickard. Members Absent: City Treasurer Joe Modica Staff Present: Deputy Administrative Services Director Jeri Rangel Administrative Assistant Victoria Randall Call to order: 9:02 a.m. by Mayor Béraud. Public Comment: None. Mayor Béraud closed the Public Comment period. Business: 1. City of Atascadero Purchasing Policy – Revisions Administrative Services Director Rickard reviewed changes to the City’s Purchasing Policy. She explained that the local vendor preference was increased from 2% to 5% in this revision; other changes were minor and basically clarified procedures. Mayor Pro Tem Fonzi asked that preference for local vendors for professional services, when feasible, also be reflected in the policy. Ms. Rickard explained that regular meetings are held with Department Heads to review their budget and monitor expenditures. This communication ensures compliance with City policy and prudent spending. Public Comment: David Bentz said it is important to interject competition into the purchasing policy and said the lowest responsible bidder award should not rely on price alone, but also on who is able to Finance Committee Page 2 of 3 deliver the project. He suggested the City set up a centralized store inventory, as well as a cooperative purchasing arrangement with surrounding cities to access better pricing. Mr. Bentz suggested that the City needs someone who can ensure prudence in all purchase decisions, adding that he did not think the purchasing policy is strictly adhered to in all cases. Mayor Béraud invited Mr. Bentz to contact City Manager McKinney or Administrative Services Director Rickard with any concerns. Mayor Béraud closed Public Comment. 2. City of Atascadero Investment Policy – Revisions Ms. Rickard stated that the City has been preparing monthly investment reports for the Council, but is requesting approval for quarterly reports instead. Reconciliations would continue to be done monthly, and staff would notify the Council of any significant issues, should they occur. She explained that City Treasurer Joe Modica works with brokers and dealers to shop for investments and get the best deal. He also reviews all monthly statements. Mayor Pro Tem Fonzi suggested money market funds be considered in lieu of normal checking accounts, since FDIC insures them for $250,000. Ms. Rickard discussed the Local Agency Investment Fund (LAIF), a statewide fund into which local agencies can make deposits for short-term use. She stated that LAIF is state-protected and funds are liquid. Ms. Fonzi requested additional information on LAIF; Ms. Rickard will follow up. Ms. Rickard explained that City investments are limited to those allowed by the Government Code. The City avoids risky investments, using only CDs and government securities. Public Comment David Bentz shared his experiences as Administrative Services Director at San Juan Capistrano. He concurred that LAIF is very safe, but stated that could change. Mr. Bentz said the City should prepare monthly investment reports instead of quarterly so that the Council can provide a check-and-balance for the City Treasurer. Mayor Béraud closed Public Comment. Mayor Pro Tem Fonzi stated she shared the concerns expressed by Mr. Bentz and opposed quarterly investment reports. Mayor Béraud stated she supports staff’s recommendation for quarterly reports and asked that this matter be brought before the City Council for a decision. Public Comment David Bentz requested that the City Treasurer explain the investment reports in a monthly, public meeting of the Council. Mayor Béraud closed Public Comment. Finance Committee Page 3 of 3 Ms. Rickard explained the staffing impacts associated with frequent reporting cycles. City Manager McKinney said that staff could investigate reporting options, and he suggested that further discussion on the investment policy be arranged in October. Mayor Béraud and Mayor Pro Tem Fonzi approved the Purchasing P olicy, but withheld approval on the Investment Policy until more information can be obtained. 3. General Financial Update Ms. Rickard provided a general update on the City budget and impacts imposed by the State. She stated that repayment of the $700,000 Prop 1A take may present an opportunity for the City, as the State is currently considering 6% interest on the payback. Due to the economic uncertainty, the City is maintaining a conservative approach on vacant and chilled positions. Sales tax and property tax figures are not yet finalized. The City’s conservative approach will allow us to deal with more economic challenges, should they occur. City Manager McKinney explained changes in coverage at City Hall due to staff reductions adding that staff is considering a modification of the hours City Hall is open to the public in an effort to mitigate some of the staffing challenges. Ms. Rickard discussed the impacts of gas prices, stating that gas taxes are still an unknown. The City continues to maintain a balance of providing optimal services to the community within the constraints of existing resources. Ms. Rickard stated that even with the $1.3 million and $275,000 takes, the RDA will survive, although projects must be postponed. She added that staff will be working with experts to determine the City’s bond strategy. In addition, SLESF and Motor Vehicle In-Lieu fees may both be targeted by the State, but the City is in a position to adjust. Public Comment: David Bentz suggested the City do competitive bids for bonds and stated that if CRA wins its lawsuit, that could impact the bonds. He added that the City might consider borrowing from the Low-Income Housing Fund to address the takes. Mr. Bentz offered to help locate software that can run City reports. Adjournment Mayor Béraud adjourned the meeting at 10:56 a.m.