3.21.22 Special Session

The Council met in special session on Monday (3.21.22) to discuss two things.  The first was a goal setting session.  After discussion, the Council agreed on three goals for the upcoming year:

1.  Develop a plan for fiscally and structurally sustainable budget.  Being sustainable means that our budget cannot rely on one time funding or reserve spending.  Cloven pushed for agreement that our goal should be to have one unified message around whatever is agreed upon to address our looming budget shortfalls - to which I responded that that would be premature.  Without knowing the specifics of a proposal or plan, I stated that I would reserve judgment as to the efficacy.  Instead, I suggested the goal that we actually adopted.

2.  Have a discussion around bringing our staff tools and resources up to modern standards.  It's been mentioned at different times some of the challenges that staff work through on a regular basis.  This goal is essentially to assess those, and discuss potential approaches to mitigate or alleviate those challenges.  One theme that was raised was related to the growth of the city, and the growth of the bureaucracy required by the state.  While our staff size has remained relatively flat over the years, the population of Clayton has increased which increases the need for city services.  Some of these services are scalable, but many are not.  In addition to population growth, the requirements that the state imposes for regulatory compliance reporting have increased as well.  The volume of reporting is not affected by city size so the administrative burden these requirements impose is not insignificant.

This is an important matter to be addressed, but why it was needed to be established as a goal as part of our annual goal setting session seemed odd to me.  The Mayor controls the Council agenda and this discussion item could have been placed on the agenda at any time.

3. Submission of a Housing Element that is compliant with the law.  This too seemed odd as a goal as it's commonplace to comply with the law.  The law requires a compliant Housing Element be submitted every eight years and we've already done significant work as a city to meet this requirement.

There was also discussion around a change to Council Guidelines.  Nothing in the guidelines supersedes what is established in the CA Gov Code, and nothing in the guidelines is binding on the Council.  The guidelines are established however, as a way to communicate norms that may make the operations of the Council smoother.  Our City Manager proposed a change to the way that items are agendized.  The practice of the Council has been that any Councilmember can request an item be brought forward on the agenda and anything that is requested would then be brought forward for a future discussion.  City Staff don't take action unless directed by the Council collectively, but we can discuss among ourselves if we want to provide that direction.

The proposal that was advanced was to have Councilmembers vote on whether something is ever put on the agenda.  I was opposed to this for a couple reasons.  First, we as Councilmembers are not allowed to discuss among ourselves any issue that has not been agendized, either at a Council meeting, or outside of a Council meeting.  This means that we would need to vote on whether we want to take up an issue, before actually understanding what that issue was.  Without ever getting to the merits of an issue, something could be dismissed.  This limits overall discussion.  Second, this would mean that a majority could prevent an issue ever being raised or discussed on the merits.  

Ultimately we did not adopt this proposal.

3.15.22 Meeting Summary

Last night the Council discussed a few significant items:

The action plan to correct audit findings was presented.  The work is in early stages and still at the point where the work is being assessed and sized.  It seems like there is quite a bit of work ahead to resolve issues discovered.  We've been in contact with multiple outside parties to assist with this effort and when they are able to scope the work staff will reconvene with the budget and audit committee to inform of progress.  The plethora of issues we are facing are significant and wide reaching - from lack of monthly close procedures, to not being able to reconcile accounts, to challenges using our internal software.  I'm glad staff is working to address all of the issues and look forward to the next update.

We discussed the mid year budget review and while we are currently in the 9th month of the fiscal year (fiscal year ends in June), the mid year review was presented as of 12.31.21.  There appears to be several puts and takes, but nothing significant that would warrant action now.  We also agreed to create a new fund to tract ARPA dollars.

We engaged with a new contract City Engineer.  Previously we used a different firm, however at our last contract renewal the rates were less favorable so we moved to a new firm.

We got an update on the CEMEX reclamation plan revision.  The current plan calls for using a large portion of the quarry to fill in the pit that has been dug over the many years.  This would be a many decades long process requiring a high volume of earth moving, which would create an abundance of noise and dust, among other things.  The proposed revision would call for leaving more of the visible land in tact, digging a larger pit, and allowing rainwater to eventually form a lake in its place.  This was informational only as the quarry is outside the city - approval of the revision sits with the County.

We also saw a demo of a cloud based budgeting software package.  This software would move staff input from spreadsheets to the cloud, and put a front end UI to allow for data visualizations that could be accessed by staff and the public.  On a periodic basis, our actual data would be loaded and also viewable by the same parties.  The license cost of this application was proposed as $16,500/year with a three year contract.  The Council voted to move forward with application on a vote of 3-2.  Myself and Councilmember Diaz voted no.

While I think the application had a lot of utility, I voted against spending the near $50K for two reasons.  The first was related to the first item I discuss above.  There are a number of basic accounting functions that we need to shore up, or start doing.  Getting our basic operations up to speed to me is a higher priority than a tool that while better than our current process, doesn't address the fundamental issues within the finance group.  The team is small (two people) and there is a functional limit to bandwidth.  Until we get our basic operations on solid footing, I did not think it prudent to shift focus.

The second reason I voted against spending on this new software was based on information that we learned about ARPA funding.  Previously we were told that ARPA funding had a limited set of eligible uses, and a time window in which the funds needed to be used.  This meant that there were only a few different ways we could spend the money, if we didn't spend the dollars, at some point we'd lose them.  It is with this in mind that we created the Clayton Cares program to assist our local small businesses and residents most impacted by the pandemic.

Last night however, we learned the rules regarding ARPA funds have changed significantly.  Now, there is essentially no restriction on the types of eligible uses of funds, and no time limit upon which they must be spent.  Now, the ARPA funds (approximately $2.8M, of which $680K has been used) function more as general unrestricted fund balance.  This completely changes the character of the dollars and any spend of these dollars is more akin to spending down our reserves.  Whereas before there was both a time and use incentive to use the funds quickly, now I believe we need to evaluate spend more critically as we would any spending of reserves.  This is especially true given our structural deficits.  

Unfortunately it appears the City is treating the ARPA funds as a means to increase spending and as a way to plug various holes, as is suggested throughout the mid year budget review presentation.

Upcoming Meetings - Budget/Audit Committee 3.14.22 and Council Meeting 3.15.22

There are two meetings this week - The first is a Budget/Audit subcommitee meeting today, and tomorrow's regularly scheduled Council meeting.

Budget/Audit Subcommitee 3.14.22:

• We will be discussing the Accounting Action Plan to address the prior year audit findings
• We will be receiving a presentation regarding ClearGov budgeting software
• We will be discussing the mid year budget presentation

All of these items will be considered for recommending to be sent to the full Council.

Council Meeting 3.15.22:

There are a few significant items on the agenda:

• Discuss the Accounting Action Plan to address the prior year audit findings
• Discuss the ClearGov budgeting software and whether to appropriate funds to purchase and implement
• Discuss the mid year budget review and authorize the establishment of a separate fund to track these monies
• Adopt resolution to engage a new City Engineer
• Discuss an update on the CEMEX Land Use Permit Revision Application pertaining to the Clayton Quarry Reclamation Plan

If you have any thoughts or questions on these items, please let me know.

3.1.22 Meeting Summary

Last night there was only one item that we discussed and that was whether there would be a quorum for the 4.5.22 meeting.  That meeting takes place over MDUSD spring break and there was a thought that folks may not be available at that time.  There was no indication this would be the case so no action was taken and the scheduled meeting remains on the calendar.

There were a few comments regarding the door hangers that went out over the weekend.  While I am glad to continue to get the word out about the Clayton Cares program  (https://claytonca.gov/claytoncares/) providing funding assistance to businesses and households in Clayton, I was disappointed when I saw the Housing Balancing Act (https://clayton.abalancingact.com/example-sim-da) site launched.

When we originally discussed the potential sites for upzoning at our 1.4.22 meeting, there were a limited number of sites identified.  I inquired at the time whether we could consider additional sites, consider changes in density, etc.  It was represented at the time that that discussion was just an early itteration, that there would be more time to discuss and flesh out ideas.  This was what our hired consultants had come up with, but we were told we would be able to further discuss other options that may not have been considered.  That seemed reasonable so I was anticipating a time that we would be able to discuss further.

Unfortunately that future discussion has yet to come to pass, and the above linked site was launched asking for resident input.  The site however only has the limited options that were presented back at that  January meeting.  This means that when folks go to vote or offer input, they are guided to the options presented.  There is of course room for people to enter free form comments, however like push polling, this will bias the results of the tool towards the options presented.

Councilmember Diaz requested last night that we actually have the discussion that was promised previously so hopefully we'll be able to start having these more meaningful conversations before it's too late.