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HomeMy WebLinkAbout1987-01-05 City Council Summary MinutesCITY COUNCIL MINUTES PALO ALTO CITY COU NCI t M EPINGS ARE BROADCAST LIVE VIA KZSU- FREWE NCY90.1 ON FM DIAL - Regular Meeting January 5f 1987 ITITEM PAGE Oral Communications 7 9 5 7 Minutes of December 8, 1986 7 9 5 7 1. Election of Mayor and Vice Mayor Consent Calendar 2. Contract with Amtech Elevator Company for Elevator Maintenance and Repair at Civic Center Building and Webster -Cowper Garage 3. Conveyance of Former DeAnza School Site 7 9 6 0 Below -Market -Rate Duplex Lot to Palo Alto Sousing Corporation 5. Amendment No. I to Contract No. 4606 with 7 9 6 0 Coopers and Lybrand for Audit Services Study Session re Noise Issues 7 9 6 4 Final Adjourment at 10:30 p.m. 7 9 6 4 7 9 5 8 7 9 6 0 7 9 6 0 7 9 5-6 1/05/87 Regular Meeting Monday, January 5, 1987 The City Council of the City of Palo Alto met on this date it the Council Chambers, 250 Hamilton Avenue, at 7:31 p.m. PRESENT: Bechtel (arrived at 7:34 p.m.), Cobb, Fletcher, Klein, Levy, Patitucci, Renzel, Sutorius, Woolley Mayor Cobb announced the Council would adjourn upon conclusion of the meeting to a Study Session re Noise Issues. ORAL COMMUNICATIONS 1. Ben Bailey, 454 Forest Avenue, said he previously brought to the attention of the Council that of 108 complaints to the Palo Alto Police Department in 1985, 101 found the cfficcr acted properly. Of the 55 complaints on which he had information in 1986, only three were sustained. He was abused by the Palo Alto Police Department and his complaint was whitewashed. He believed the item was important and should be age sdized. 2. John Mock, 736 Barron Avenue, was distressed that the Stud► Session of December 13, 1986, was not fully described in the minutes. Nowhere was it mentioned that the Study Session re Priority Setting involved having the priority that received the most votes not listed in the final agenda of priorities. He hoped the public would be able to read about that evening's Study Session in more detail than what appeared in the newspaper. MINUTES OF DECEMBER 8 198.6 Councilmember Fletcher submitted the following corrections: Page 7918, fourth paragraph, 5th line, "not Without any analysis,* should read not significant.* Page .7918, fourth paragraph, 9th line, *Palo Alto's* should be deleted. Page 7918, fourth paragraph, 10th line, "Inter -City Council" should read. "Interstate Commerce Commission." MOTION; Councilnenber Sutorius moved, seconded by Woolley, approval of the Minutes of Decor S,. 1986, as corrected. 7 9 5 7 1/05/87 NOTION PASSED unanimously. 1 e 1. ELECTION OF MAYOR AND VICE MAYOR (701) Mayor Cobb said the City Charter stated the Mayor and Vice Mayor should be elected by the Council at the first meeting in January to serve for one year or until their successors were appointed. The first Councilmember to receive a majority of five votes would be elected Mayor. Couneilmember Levy intended to east his vote for Vice Mayor Woolley to become Mayor. Vice Mayor Woolley was a long-time resident of the community, had raised a family in Palo Alto, lived in Southgate, and knew the neighborhoods in Palo Alto because of her outstanding work in the area of historic preservation. She was ealso a school teacher. He believed Vice Mayor Woolley possessed the personal qualifications to cope with the City Council and to lead the community well in the coming year. Mayor Cobb and Vice Mayor Woolley were excellent leaders during the past year. Mayor Cobb introduced a number of creative innovations into the running of the Council and into the leadership of the community. Councilmember Sutorius concurred with Councilmember Levy. RESULTS OF THE FIRST ROUND OF VOTING FOR MAYOR City Clerk Gloria Young announced the results of the first ballot: VOTING FOR WOOLLEY: Levy, Renzel, Patitucci, Klein, Woolley, Cobb, Sutorius, Bechtel, Fletcher. Ms. Young said Mayor Woolley received nine votes and was appointed Mayor. Councilmember Cobb observed that in the last five years Council made a practice of rotating the office of Mayor among Ceencilmembers. The job was fun and easy to get attached to, and he trusted the tradition would continue. He tried hard to keep his promises of a yea a.yo to be fair. He believed Council had a good year •and accomplished a great deal, and the spirit of teamwork and cooperation had been extraordinary. It was a special privilege to serve as Mayor of Palo Alto, one, he would always cherish, and he hoped his colleagues would join ham in giving that same cooperation and teamwork to Mayor Woolley who would do an excellent job in t: a Coming year. 7 9 5 8 1/05/87 Mayor Woolley said being on the City Council in Palo Alto was a privilege, being Vice Mayor made it more special, and being Mayor made it very special. She thanked her colleagues for their sup- port and confidence and believed they could make the next year a good one for the residents of Palo Alto. Mayor Cobb was a tough act to\follow, and one of the main things she could do was to follow through on some of the new directions he had- started. A Council first in Palo Alto was the retreat the previous September. The most immediate outcome was to make the meetings . more effi- cient, and she believed some progress had been made but Council should continue to work on that area. Two new directions she wished to adhere to were the monthly study sessions and focusing on priority issues. Futurecast 2001 was the exception. It was a valuable exercise, but she would like Councilmember Cobb to con- tinue overseeing the project and carry it to a conclusion. She wanted to emphasize increased communication between the City gov- ernment and citizens. She particularly would like to keep the doors open with the Palo Alto Unified School District and also with the Chamber of Commerce. However, she hoped all citizens would consider the door to City Hall open and to that end she would keep some regular hours in City Hall in the afternoons. The public could find out those hours from the City Clerk. Since she came to the Council via the route of historic preservation, it was appropriate she spend, time looking ahead during the year to Palo Alto's one -hundredth birthday in 1994. She hoped that would be a very meaningful celebration for all residents and one that would involve all ages and interests, and it was important for a few wheels to start turning on some of the major and long-range projects. Councilmember Klein intended with a great dell of pleasure to vote -for Jack Sutorius for Vice Mayor. His service on the Council had been diligent, distinguished, energetic, and extremely helpful to the entire community. Councilmember Sutorius also served as president of the Northern California Power Agency, which was a great contribution to the City and consumed a treat deal of his time. The Councilmembers all appreciated Councilmember Sutorius' numerous activities behind the scenes which were beneficial, and in the role of Vice Mayor he would be able to serve even better. RESULTS OF THE FIRST ROUND OF VOTING FOR VICE MAYOR City Clerk Gloria Young announced the results of the first ballot VOTING FOR SUTORIUSI Levy, Fletcher, Bechtel, Woolley, Cobbf Klein, Patitucci, Menzel. ABSTAINIi4Gz Sutorius. Ms. Young said Council weber Sutorius received eight votes and was elected Vice Mayor. 7 9 5 9 1/0'5/87 Vice Mayor'Sutorius appreciated Councilmember Klein's comments and thanked his colleagues for their support. He pledged to Mayor Woolley the type of effort, diligence, and cooperation that she provided, to Mayor Cobb during her year as Vice Mayor. CONSENT CALENDAR Item 4, Agreement with Malcolm Jones & Associates for Fuel Cell Applications Feasibility Study, was removed at staff's request. MOTIONi Councilmember Cobb moved, seconded by Levy, approval of the Consent Calendar. 2. CONTRACT WITH AMTECH ELEVATOR COMPANY FOR ELEVATOR MAINTENANCE AND REPAIR AT CIVIC CENTER BUILDING AND WEBSTER-COWPER GARAGE (810-02-01).(CMR:612:6) Staff recommends that Council: 1. Authorize the Mayor to execute the contract with Amtech. Reliable Elevator Company in the amount of $16,788 for -calendar year 1987, $17,280 for 1988, and $17,760 for 1989. 2. Authorize staff to execute change orders to the contract of up to $2,500 for each of the three calendar years. 3. CONVEYANCE OF FORMER DEANZA SCHOOL SITE BELOW -MARKET -RATE DUPLEX LOT TO PALO ALTO HOUSING CORPLRATION (810-02°- } (CMR:611:') f , RESOLUTION 6582 AUTHORIZING CONVEYANCE OF REAL PROPERTY TO THE PALO ALTO HOUSING CORPORATION GRANT DEED NOTION PASSED unanimously. 5. AMENDMENT NO. I TO CO` TRACT NO. 4606 WITH COOPERS AND LYBRAND FOR AUDIT SSRVZC S -0 ) City Auditor Michael Northrup introduced Cathy Shindledecker, a partner. in Coopers & Lybrand. He recommended the price of the City's external serviLces contract with Coopers & Lybrand be increased by $14,650, which would raise the contract price from $49,000 to $63,650,. plus a contingency of $8,350. He expected most of the contingency to be spent so the total cost of the contract would be approximately $72,000. The cost increase resulted from the inability of City staff to meet certain agreed upon timetables tor preparing schedules needed by the auditors to 7 9 6 0 1/05/87 complete their work in a timely manner, and the preparation of a checklist and questionnaire by the outside auditors to be used by City staff and certain community agencies to better comply with federal regulations for the use of federal funds. Together the two areas represent about $6,000 of the requested increase. The third area required approximately 325 hours, or $17,000, to address how certain accounting issues were handled in the past. Some of the issues involved how the City previously computed and booked certain benefit accruals, self-insurance liabilities, the way the City handled its joint venture accounting issues for the Northern California Power Agency (NCPA) and the Transmission Agency of Northern California (TANG), and required documentation which the auditors were required to prepare for discussion and reporting of the prior period adjustment. There were several other issues. Coopers & Lybrand did not anticipate the issues during the bidding process and could not have anticipated them. Had the additional issues not arisen, the contract price would not have exceeded the contingency funds already approved for the con- tract. Vice Mayor Sutorius asked about the initiation for the question- naire and the associated costs. Mr. Northrup said the questionnaire and checklist had to do with the way City staff and certain community agencies, i.e. the Palo Alto Housing Corporation and the Senior Coordinating Council, used federal funds funneled through the City to those agencies. The questionnaire and checklist would help the community agency accounting and finance staff to better control the funds and it would help',City staff better control the way the agencies used the funds. The total cost for the staff -caused delays and the questionnaire amounted to approximately 150 hours worth of Cooper's and Lybrand's time; and approximately 60 hours of the 150 hours had to dowith the questionnaire at a cost of approximately $30000. Vice Mayor Sutorius asked about the delay factor on the part of the City which contributed to the additional hours. Director of Finance Mark Harris believed staff was over ambitious in terms of what they believed they could accomplish given the state of the current accounting system and their training and expertise. Two senior accountants were hired in the February and March timeframe, and although staff believed the time schedule would work, Coopers and Lybrand conducted the most thorough audit the. City ever went through, which resulted in some data requests staff was unprepared to handle. Staff was not up to speed on some ofthe utilities accounting and some of the issues surrounding it. Staff needed more time than originally anticipated. 7 9 5 1 1/05/87 1 1 Vice Mayor Sutorius said when the City entered into the subject contract with Coopers & Lybrand, there was a separate contract in the amount of $30,000 for accounting services to facilitate closing the books for the prior year. He asked about the number of hours expended and the final costs. Mr. Harris did not have the precise hours, but said 750 hours were budgeted. The final number of hours expended were about 3.00 short of the 750 hours. Councilmember Levy said most of the additional costs were related to either accounting treatments previously used or an inability to reconstruct information from previous work papers. He asked about the accounting treatment problem areas and. the associated costs versus inadequacies with previous work papers. Ms. Shindledecker said the issues were not all resolved which was part of the reason for the request for increase in fees. A major issue had to do with sick pay accrual✓. In the old sick pay plan, sick pay liabilities vested, i.e, they were either paid in cash or employees got the time off when sick. Liabilities needed to be accrued under generally accepted accounting principles and the liabilities were not accrued in the books or records of the City. Secondly, the City was self -insured for health, dental, worker's compensation, and general liability. Anytime the City was self - insured, there needed to be an accrual or a liability recorded for the amount of the claims likely to be incurred as well as for an amountfor incured liabilities not yet reported. Those numbers were never determined so Coopers & Lybrand had to determine the liabilities.. Coopers & Lybrand actuaries in San Francisco were used to help keep the costs minimized. There was a dual problem in that the liabilities were never recorded and the numbers were not determined. Another issue related to accounting in the joint venture area for Northern California Power Agency (NCPA) and the Transmission Agency of Northern California (TANC) liabilities, which were significant. There were many disclosure issues involved and the question arose that because they were "take or pay* contracts, the City had to pay for the liabilities regardless of whether any energy was used. ' The question was whether they were really liabilities or commitments since disclosures were different for each. Research needed to be done on the question of reporting prior period adjustments. The capital project fund. balances would require audit review once it was determined what transfers, if any, needed to be made. The foregoing key issues arose after the determination of final audit fees made in June of 1986. 7 9 6 2. 1/05/87 Councilmember Levy said Council was recently informed that because of mishandling of the accounting of Capital Improvement Fund project carry-overs, there would have to be . a reduction in the area of $2 million in the City's uncommitted reserves. He queried whether there might be other reductions and asked about the dollar amounts being considered. Ms. Shindledecker clarified the issue was not yet resolved and the numbers were not yet determined. Most of the issues affected the general and enterprise funds. Any impact on the Capital Improve- ment Fund balance adjustments would be indirect because of the transfers which might be needed from other funds. Councilmember Patitucci asked whether the total costs for the audit would have been close to the amount originally contracted without the unforeseen issues. Mr. Northrup said the contract price was $49,000 and he expected the next contract price to be in the same area. Councilmember Patitucci said Council had to rely on staff to say whether expenditures were necessary to meet set objectives. He did not want to set in motion a process where the auditing costs were $66,000 per year rather than the $49,000 per year originally anticipated for a city the size of Palo Alto. Ms. Shindledecker said the $49,000 was a good ballpark figure for next year. However, a new, but as yet unidentified, accounting system would be installed, and she could not determine whether it would have a positive or negative impact on the audit fees. Councilmember Patitucci clarified an improved accounting system might provide better information and lower the audit fees. Ms. Shindledecker said it was possible; but generally in the first year of implementation, it was difficult to get that. benefit. NOTIONs Cesec i 3 *sbor Cobb , moved, seconded by Bechtel, to adopt the staff recommendation to approve the amendment to Contract No. 4606 for eater ai audit services, imam/Laing the contract price from $49,000 to $63,65►0,, and maimoipimg the current contract contiS0ency at $8,350. ANISNON8NT NO. 1 TO CONTRACT NO, 4606 Coopers & Lybrand Councilmember Cobb cautioned that next time cost overruns brought to Council's attention early in the game. e Councilmember Levy supported the motion, but was concerned about the potential impact on the City's uncommitted reserves. He would be unwilling to support further budget amendments until the accounting process was completed and Council had a complete picture of the City's financial status and its reserves. MOTION PASSED unanimously. ADJOURNMENT Council adjourned to a Study Session re Noise Issues at 8:10 p.m. STUDY SESSION RE NOISE ISSUES Assistant Police Chief Chris Durkin said most of the noise com- plaints involved leaf blowers. All investigations to date showed that gasleafblowers exceeded the maximum decibel level allowed by the ordinance. Manufacturers of leaf blowers were advised of the problem but had been unable to muffle the noise because it caused the machines to overheat. Lieutenant Ed Austin said some cities considered a ban on leaf blowers all together, other cities allowed leaf blowers on certain days during certain time periods. The Police Department will provide a report to City Council and the matter was tentatively scheduled to be agendized on Monday, February 23, 1987. FINAL ADJOURNMENT Final adjournment at 10:30 p.m. ATTEST: APPROVED: Mayor 7 9 6 4 1/05/87