HomeMy WebLinkAboutMinutes - Minutes - City Council - Meeting Date: 2/17/2009 *PLEASE NOTE: Since the Glendale City Council does not take formal action at
the Workshops, Workshop minutes are not approved by the City Council.
•
MINUTES
CITY OF GLENDALE
CITY COUNCIL WORKSHOP
FEBRUARY 17, 2009
PRESENT: Mayor Elaine M. Scruggs, Vice Mayor Manuel D. Martinez, and
Councilmembers Joyce V. Clark, Steven E. Frate, David M. Goulet,
Yvonne J. Knaack, and H. Phillip Lieberman
ALSO PRESENT: Ed Beasley, City Manager; Pam Kavanaugh, Assistant City
Manager; Craig Tindall, City Attorney; and Darcie McCracken,
Deputy City Clerk
1. GLENDALE CENTERLINE UPDATE
PRESENTING THIS ITEM: Dick Bowers, R.A. Bowers & Associates; and Ruth Yabes,
Associate Professor, ASU School of Planning ASU Students
Pursuant to City Council direction this is a request for the City Council to engage in
dialogue facilitated by Richard Bowers regarding the City Council's efforts to enhance
the vitality of the Glendale Avenue Corridor and create a vibrant city center. This is the
fourth of a series of planned Council Workshops on this topic.
The Revitalization Strategy addresses several Council Strategic Goals, which include
the following:
o Strong neighborhoods
o Quality economic development
o Vibrant city center
o A city that is fiscally sound
At the Glendale City Council Goal Review and Strategic Planning Retreat held on
November 26, 2007, the Council discussed key objectives and goals for Fiscal Year
2008-2009. The primary objective identified by the Council was a desire to create a
clear vision for redevelopment and revitalization within the city. Aspects included in this
objective are a focus on infill development throughout the city and creating a vision and
action for downtown Glendale.
In order to develop a strategy for achieving this objective, the Council agreed that
substantial discussion would be needed to set the foundation for a downtown visioning
and revitalization process. In order to achieve this, the Council requested workshops
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throughout 2008 to facilitate the discussions that will lead to a comprehensive strategy
policy direction by Council.
Implementation of the Council's direction will include developing tools, conducting
research, and formally engaging content experts to assist with benchmarking,
community involvement, branding, design, and action plan concepts.
In May of 2008, research visits were completed by the Mayor, Council, and staff to cities
in Southern California, the greater Denver area and the greater Portland area. These
visits will assist in the development of a set of core principles, policy options and images
that will help define the downtown vision and create a frame of reference for continued
dialogue.
The Council has directed that an open and ongoing dialogue with citizens be developed
as a component of the effort to assure that the community has input, is kept informed,
and is pleased with the direction to be forged. Ultimately, the Council's policy direction
will provide a framework for staff to implement the strategy and provide measurements
of progress.
Currently, the City of Glendale encompasses approximately 56 square miles and has a
population of almost 250,000. As the city has grown, shopping and employment areas,
including the downtown and commercial corridors, have developed, matured, and
changed their orientation. Smaller parcels often overlooked by developers are now
becoming more attractive for infill development. As a result of these changes, the
downtown area and commercial corridors, such as Glendale Avenue, have become
underutilized and are in need of comprehensive revitalization and redevelopment.
At the March 18, 2008, August 12, 2008, and December 16, 2008 City Council
Workshops, the Council engaged in dialogue facilitated by Richard Bowers regarding
the City Council's efforts to enhance the vitality of the Glendale Avenue Corridor and
create a vibrant city center. These were the first and second of a series of four planned
Council Workshops on this topic.
At the Glendale City Council Goal Review and Strategic Planning Retreat held on
November 26, 2007 and facilitated by Richard Bowers, the Council discussed key
objectives and goals for Fiscal Year 2008-2009. This topic was also re-visited at the
Fiscal Year 2009-2010 Council Strategic Planning Retreat in November of 2008.
Objectives and goals discussed at that time focused on downtown redevelopment and
revitalizing the Glendale Avenue Corridor, which is encompassed by the City Center
Master Plan (CCMP).
The Council adopted the CCMP on July 23, 2002 by Resolution No. 3602 New Series.
Resulting vision, plans and action will provide an enhanced sense of place, a
destination, and an identity for Glendale that will strengthen the sense of community,
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enhance Glendale's image and attractiveness throughout the region and nation, and
strengthen the city's economic foundation.
Revitalization and redevelopment plans will provide for more effective uses of many
properties to better support residential, commercial, and public facilities development at
appropriate locations and diminish incompatible uses.
Revitalization, infill, and redevelopment of the downtown and existing commercial
corridors will permit Glendale to continue to be the focus of the West Valley. These
efforts will offer a fresh vision of downtown as the center of a vigorous and growing
community and will result in high-quality public and private investment along the
Glendale Avenue corridor and other commercial corridors.
Infill, by utilizing vacant or empty lands in developed areas, will achieve economies;
including taking advantage of existing infrastructure and ensuring that new development
activities work in concert with each other to achieve the vision of downtown.
Through the months of November and December of 2008, the Roving Centerline Booth
project was conducted as a way to inform residents about the project and gather citizen
feedback and input. Staff took the booth to residents throughout the following areas;
Arrowhead Mall, Main library, the Community Center, Glendale Glitters, Foothills
Aquatic Center, the Adult Center and various city parks.
On October 22, 2008, a Small Group Workshop, conducted by ASU, was held at the
Glendale Adult Center, with a combination of volunteers, community leaders, residents,
and businesspersons who participated in a small group workshop starting with a student
presentation followed by focused questions and brainstorming.
On October 18, 2008, a Visioning Fair was held at Murphy Park to engage the public in
creating a vision for the Glendale Avenue Corridor.
On September 20, 2008, a Congress of Neighborhoods was held at the Glendale Civic
Center to inform and gather input from a select group of community members. •
On September 16, 2008, a Business Breakfast was held at the Glendale Civic Center to
engage the local business community in the Glendale Avenue Corridor initiative. All
Councilmembers were invited to attend and participate.
The recommendation was to provide updates regarding the information gathering and
public input process to date.
Mayor Scruggs began the meeting with welcoming Glendale's Mayor Youth Advisory
Commission. She explained they were here today for Student Government Day and
had been shadowing various members of city staff. She thanked them for all they do for
the city.
Mr. Bowers introduced this item and reviewed the process to date. He introduced Dr.
Ruth Yabes, as well as Ms. Sarah Dickerson and Mr. Alexander Keen, the two speakers
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who represent the 19 students. Dr. Yabes thanked the Mayor, Council and city staff for
the opportunity to work on the Glendale Centerline. She stated the students have
learned a lot and was delighted to have had this opportunity. She indicated what will be
presented are only recommendations and possibilities. She added none of the
recommendations have a budget and are not hard concrete options. She explained she
felt the need to clarify this point because of the current economic environment.
Mr. Keen provided a PowerPoint presentation on the project assessment and research.
The downtown area has been the historic, cultural, and civic heart of the city since it
was established in 1892. The downtown contains many of Glendale's historic
neighborhoods and landmarks, as well as the Glendale City Hall, Civic Center and
various municipal structures. Over time, the current area has been characterized by its
auto malls, antique stores, and industrial complexes. However, Mr. Keen stated that the
city was in a phase of transition with the character of the area shifting and moving these
industries to other places. He discussed the demographics, neighborhoods, historic
properties, crime and safety, public facilities, art and culture. He reported approximately
11,000 people are in the Glendale Centerline area as revealed by the U.S. Census. He
explained that the largest concentration of people was between 59th and 67th Avenues.
The average household income for the Glendale Centerline is $36,583, with 35% of the
Centerline occupants having some sort of college or above education. He stated this
education and income data indicated a need for enhanced education, career training,
and job opportunities. He noted the 2000 Census data shows 67% of residents
identified as "white" followed by 24% identified as "other". However, when the
Hispanic/Latino community was accounted for, 61% of the people in the Glendale
Centerline identified as "Hispanic/Latino". This is a significant majority and should be
taken into consideration in regards to community involvement, culture, and history as
the area is developed.
Mr. Keen reported on land use, zoning, and transportation. Zoning districts in the City
of Glendale include residential, commercial, industrial and agricultural categories. The
general plan and its future land use map and zoning ordinance, with its zoning maps,
are two separate documents created by the city. The zoning ordinance is reflective of
the current city layout, whereas the general plan depicts a possible future blue print. He
added that when looking at the conflicts between them, they can identify what areas of
the city are likely to change in the future. He discussed vacant properties being an
important starting point for redevelopment. The majority of the vacant lots, 70%, are
residential with the remaining vacant lots, 16%, are industrial. 14% are commercial. He
noted that with vacant properties scattered throughout, the foundation exists for future
redevelopment in the Glendale Centerline. He also provided information on housing
trends and cost in the Glendale Centerline area, as well as property owners in Glendale.
The largest owners of residential properties in the Glendale Centerline are local
businesses with rental and real estate licenses. Individual owners and real estate
companies also own the majority of the rental properties throughout the area. He
reviewed general recommendations for the Centerline which included enhancement of
the downtown's attractiveness, creation of identifiable destinations and anchors,
preservation of historic areas and enhancement of transit and transportation options.
He noted the discovery tours taken by the Council had been very useful in obtaining
pertinent information for their study.
Ms. Dickerson continued with the presentation discussing community involvement. She
stated that community involvement and input were essential to achieving successful
redevelopment goals. Glendale hosted several public involvement activities this fall to
gather ideas about the future of the Glendale Centerline. This included the Business
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Breakfast, the Congress of Neighborhoods, and the Vision Fair. The studio class also
facilitated an ASU community workshop where residents worked in a hands-on setting
with students, locating areas for redevelopment and brainstorming future possibilities.
This workshop provided invaluable input which was pivotal in moving the studio project
forward. She explained that based on research, community input, case studies and City
Council and staff feedback, seven general recommendations for the Glendale
Centerline were made. (1) Enhance downtown attractiveness through the design of the
physical and built environment. (2) Create identifiable destinations, anchors and niches
that retain a family-oriented, small-town feel, while encouraging entertainment and
nightlife in other sites. (3) Preserve historic character areas. (4) Promote mixed—used
development. (5) Market and expand commercial and retail development. (6) Enhance
transit and transportation options, creating a smooth flow and connections between the
different areas in the Centerline. (7) Celebrate and build on public participation, making
sure to include all stakeholders in Glendale Centerline redevelopment visioning,
planning and implementation. Next Ms. Dickerson explained the nine development
possibilities that reflect local conditions and encompass many of the redevelopment
principals. She noted that all the developed possibilities are proposed concepts and
none were set in stone. The development possibilities are meant to open new
possibilities of what the Glendale Centerline might be in the future, if some or all the
recommendations were implemented. She reported the following: (1) a gateway
entrance between the City of Phoenix and the City of Glendale, (2) a business park that
replaces the vacant auto dealerships lots and serves the new court house currently
under construction, (3) the Beet Sugar District that creates an anchor destination
between the Beet Sugar Factory and Cerreta's Candy Company, (4) a light industrial
park that consolidates the Glendale Centerline's industrial businesses into a single
location, (5) a mixed-income residential development that includes mixed-use
commercial sites, green space, a spray park and a mural, (6) a traffic calming and
streetscape proposal along Glendale Avenue to slow traffic that enhances pedestrian's
walk-ability and celebrates sustainable development, (7) a pedestrian mall courtyard
that has outside dining, commercial retail and entertainment activities to draw nightlife
into Glendale Centerline, (8) a regional park and recreational facilities for all ages that
make use of vacant properties and enhance the quality of life for surrounding
neighborhoods, (9) a theater that draws nightlife and enhances cultural opportunities in
the Centerline area. She stated this report was just one step in the revitalization
process of the Centerline and concerns beyond the scope of this studio must be
addressed with further research and additional insight of where the city is headed. She
thanked the city for allowing them to participate in the redevelopment process.
Mr. Bowers reported on upcoming events that will be occurring in the next couple of
months. He stated that a Centerline Property Owner's Breakfast will be held sometime
this month. There will also be a Business Owner's Breakfast held on March 11, 2009.
An internal discussion with staff will be held March 27, 2009 with a mid-term report from
design studio on May 7, 2009. A Citywide Centerline Congress meeting will be held
May 9, 2009 with a City Council Workshop session on May 16, 2009 to tie up all the
information provided.
Councilmember Goulet thanked Dr. Yabes and students for the wonderful job they were
doing and for their outstanding presentation. He commented on the potential conflict
with the zoning plan and the general plan. He asked Dr. Yabes for her thoughts on the
matter. Dr. Yabes explained the general plan was a policy document providing broad
strokes of what the opportunities were to guide land use. However, the zoning map and
codes are very specific and legally binding on what can be done with specific properties.
She noted that in the immediate future, they can look to redevelopment options through
the zoning code in terms of making specific recommendation and assessing if there is a
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conflict. Additionally, they can make some changes in the zoning code based on the
feedback received from property owners and stockholders, and use that information to
inform and shape the direction of the general plan.
Councilmember Clark thanked the presenters for a very exciting, innovative and
creative report. She asked the presenters to expand on their recommendations of
expanding commercial and retail developments, as well as celebrating and building on
public participation. She also wondered if a critical part of those recommendations
would be the development of a business district. Ms. Dickerson stated that a business
improvement district is a public/private partnership where the city works with the
business owners and specific areas. This is something the business owners can decide
on and which provides certain grants to improve their businesses. This set up is
determined by both the city and business owners. Councilmember Clark asked if the
research showed if this was to be initiated by the municipality or businesses. Ms.
Dickerson noted it depended on the city and the circumstance; however, in this case, it
should be done by the city since they have already started the process.
Councilmember Clark asked if she felt a business improvement district was critical to
the redevelopment of the Centerline. Ms. Dickerson indicated there were certain
aspects that could be considered, such as a concepts where businesses did not have
odd hours, as well as creating businesses run by professionals, not only hobbyists. Dr.
Yabes interjected stating that regardless of who initiates the business improvement
district, the partnership aspect was really the answer, with business owners being the
key to the success of the plan.
Councilmember Clark discussed the light rail project and asked how important it would
be to implement light rail or a cohesive transportation plan for the Centerline project.
Mr. Keen stated light rail poses a great opportunity to possibly connect downtown
Glendale to other parts of Phoenix. He added it really depended on how it is
implemented and used to its advantage. Dr. Yabes explained that the light rail aspect in
the report was only an opportunity should the light rail and alternatives be used. She
added they really had no power as to where light rail ultimately is developed. However,
should light rail go through Centerline Glendale, it will change the dynamics, energy and
activities that will happen in the area. Councilmember Clark inquired what specifically
would it change. Dr. Yabes explained how light rail would provide stations which thrive
on density to supply the need for pedestrian activity.
Councilmember Clark inquired as to how historic areas would be integrated and who
would be working on that process. Mr. Bowers stated he sees that as a key component
to be handled by the art and design studio as well as by using feedback from the public.
Councilmember Clark asked Mr. Bowers to expand on the demographic issue on
determining how to attract people to the Centerline area. Mr. Bowers indicated they
would try and envision the possibilities that will attract the market and then react to the
marketplace. He noted they will possibly work together and one aspect will adjust the
other. Councilmember Clark once again expressed her thanks and appreciation for the
work presented. Dr. Yabes asked to expand on the light rail issue. She explained that
connection was the critical piece driving the public transportation network which was
readily embraced by the people, partly because of the economy. She added this
network includes buses or like transportation and was not limited to only light rail.
Mayor Scruggs inquired if there might be a transportation conflict between narrowing
Glendale Avenue from four lanes to two and the developing public transportation
enhancement. Mr. Keen stated the concept behind that thought was that they wanted
the Centerline to be a destination not only a drive-thru. He added the two lane concept
was still an advantage, even with the possibility of public transportation. Ms. Dickerson
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also agreed with the two lane concept and added there were other ways to address the
transportation options, such as having a bypass. Dr. Yabes added it was likely that
more people would be out of their cars reducing traffic and street space, which
increases pedestrian traffic as was the goal. She noted that this was again, only a •
suggestion and none of these ideas were set in stone. They will continue to study the
traffic patterns along the area. Mayor Scruggs discussed the transportation traffic
constraints as it relates to the city and state. Ms. Dickerson noted that the Centerline
had the lowest traffic counts in the entire area.
Vice Mayor Martinez also thanked Dr. Yabes and the students for their fine work on this
project. He asked for further clarification on development opportunities, densities and
relocation possibilities as explained on page 8 in the booklet. Mr. Bowers explained that
relocation was always a sensitive subject and nothing is implied or suggested as far as
relocation of businesses, but rather a long term vision and concept. He stated that
many times, these things are solved by the private sector on their own. Dr. Yabes
commented the only place they got specifics regarding relocation was in number four,
light industrial district, because there had already been some movement. She added
there was no place on the map that was completely vacant. Vice Mayor Martinez
commented on the Gateway concept. He stated he really liked the concept and would
support it. He asked Mr. Beasley if there was any new information regarding the Sugar
Beet Factory. Mr. Beasley noted the city has become aware it has been transferred to
another owner and the city has had some preliminary discussion as to its use. Mayor
Scruggs asked if the new owner was local or from another state. Mr. Beasley stated he
believes the owner was local. Mr. Tindall interjected adding he was not sure if it was a
corporation or an individual; however, it was known that the owner was working on the
property. Mayor Scruggs asked if they were working with city staff. Mr. Tindall
responded he was not sure; however, they would have to consult the city on some level.
Councilmember Lieberman commented on the Centerline Theater and its potential use.
Mr. Keen responded he envisioned this concept as a movie house and a performing
arts theater. He noted once they identify what exactly people would be interested in; it
would be possible to incorporate it into many different aspects. He explained the
structure had many different possibilities. He added the nice thing about theaters was
they were very versatile in their use of space. Councilmember Lieberman agreed and
stated he liked that whole idea very much. He thanked them all for their time and effort
on this project. He commented on the many theaters in the valley.
Councilmember Knaack commented on the business uses along Centerline. She asked
for their thoughts on the decline on Mill Avenue attributed to chain stores. Ms.
Dickerson explained that professional businesses and chain stores were not necessarily
the same thing. She added she believes that public/private partnerships with small
shops should be protected and built upon. Councilmember Knaack agreed and added
they had wonderful businesses along the Centerline now and would like to see them
enhanced, rather than have chain stores and mix-used retail and offices come in.
Mayor Scruggs discussed how she witnessed the effect of chain stores in Pasadena,
California. She stated those stores had suffered when a mall opened in the area and
those stores preferred the traffic the mall provided and therefore relocated.
Mayor Scruggs commented she would like to focus on process. She asked if this
booklet would be available for the Business Breakfast Meetings scheduled. Mr. Bowers
stated the information would be available after today on the internet. She inquired if the
property and business owners would be asked to reflect and respond to this information
or come up with new ideas and build on the recommendations. Mr. Bowers explained
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they were more than welcome to respond; however, he would like to begin the meetings
with the same kind of structure as before, with meaningful questions they would like to
seek answers to from the business community. The questions should be more design
specific and rise to the next level. He added nothing was sealed and this step was only
a piece of the puzzle. Mayor Scruggs commented on the advantage of having only five
to ten property owners because once they were bought into the project, things were
able to get done rapidly. Dr. Yabes explained it could be both an advantage and a
disadvantage. However, property owners with large parcels do create great
opportunities once they were on board. She noted also there were multiple property
owners that have to be approached individually.
Mayor Scruggs commented on a letter received from property owners along the
Centerline. She stated it essentially said they liked the traffic in the area, but wished
more would stop. The letter also proposes they receive a trial period to try some of the
recommendations outlined, such as outdoor dining. Mayor Scruggs explained and
assured the owners they will see what can be done to expedite the trial period and not
wait until the whole study is adopted to attempt something.
Councilmember Frate stated that what was important was to have an open dialogue
between the property owners and the city. He indicated that using fresh eyes and new
ideas on this project benefited everyone. He congratulated the students for their diligent
work on this project. He appreciated how they walked the areas proposed to get a feel
for all the possibilities of development. He stated the construction of the Courthouse
would be a great kick start to this project. He commented on the entry area possibility,
as well as the large parcel on 67tH Avenue. He remarked it was very exciting to know
that 13 pairs of eyes were looking at this project as a new beginning and pushing
everyone out of their comfort zone. He indicated that for years, the City Council has
wanted for to see more people living downtown. He added this will not occur overnight;
however, they were now working towards a vision and a goal of what they had
envisioned for downtown.
Mayor Scruggs thanked them once again for all their hard work. She added the
property and business owners were really anxious to provide additional input. She
expects there will be much excitement and anticipation in the weeks ahead.
Mayor Scruggs suggested a 5 minute break to transition to the next item.
2. FISCAL YEAR 2008-09 SECOND QUARTER GENERAL FUND STATUS
CITY STAFF PRESENTING THIS ITEM: Horatio Skeete, Deputy City Manager; and
Sherry M. Schurhammer, Management & Budget Director
This is a request for the City Council to review the Fiscal Year (FY) 2008-09 second
quarter report on the city's General Fund (GF) budget. The second quarter report
covers October, November, and December of FY 2008-09.
The FY 2008-09 GF second quarter report is consistent with the Council's goal of
ensuring the city's financial stability by conducting timely reviews of expenditures and
revenues.
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In response to Council requests, staff committed to providing quarterly reports on the
GF beginning with FY 2003-04. In addition to these quarterly reports and during these
times in which the state and federal economies and legislative actions require daily
monitoring, additional memos and communication have and will continue to be provided
to the Council, employees and the public as new and timely information is secured.
During the second quarter report staff identified an additional $2.5 million in reductions
that are in addition to the $1.5 million in reductions implemented earlier in FY09.
Additional expenditure management steps that have been undertaken to include a
voluntary furlough and retirement efforts, elimination of non-essential contractual
positions, consolidation of programs, and modifications to the replacement schedules
for vehicles and desktop computers.
Staff conducted a comprehensive review to minimize impacts to the community.
Further information will be provided to Council prior to the budget process.
General Fund
At the end of the second quarter, both GF revenues and expenditures are below
budget:
o GF revenues are $9.3 million or (10%) below budget.
o GF expenditures are $7.3 million or (7.8%) below budget.
As stated previously, staff is working to balance revenues and expenditures through
additional 10% reductions that equates to $2.4 million.
General Fund Revenues
• The following table reflects a comparison of the GF revenue budget and GF actual
collections for FY 2008-09.
•
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YTD Comparison
Budget to Actuals, FY 2008-09
(in 000s)
FY 2008-09 FY 2008-09 Percent
YTD Budget YTD Actuals Over(Under)
Budget
L x tt t
City Sales Tax $32,446 $26,733 (17.6%)
State Income Tax $17,344 $18,134 4.6%
State Sales Tax $11,750 $10,244 (12.8%)
State MV In-Lieu $5.021 $4,537 (9.6%)
HURF $8,808 $7,085 (19.6%)
Primary Prop Tax $2,042 $2,186 7%
All Other $15,145 $14,352 (5.2%)
$92,556 $83,271 (10%)
GF revenue receipts through the second quarter of FY 2008-09 are $9.3 million under
budget.
GF city sales tax collections are $26.7 million. This amount is $5.7 million under
budget.
State-shared revenue collections are $32.9 million. This amount is $1.2 million under
budget.
HURF revenues are commonly called the gas tax even though there are several other
transportation-related fees that comprise this revenue source. This revenue source is
based primarily on the volume of fuel sold rather than the price of fuel. HURF receipts
are $1.7 million under budget.
The All Other category, which includes such items as court fees, permit fees, business
licenses, and recreation revenue is $793,000 under budget.
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The following table is a comparison of the second quarter actual revenues between FY
2007-08 and FY 2008-09. This comparison is important because it indicates changes in
actual collections between fiscal years.
Comparison of
FY 2007-08 to FY2008-09 Actuals
(in 000s)
FY 2007-08 FY 2008-09 Percent Change
1 ge �rmcr r� r YTD Actuals YTD Actuals From FY 2007-08
City Sales Tax $31,133 $26,733 (14.1%)
State Income Tax $17,055 $18,134 6.3%
State Sales Tax $11,041 $10,244 (7.2%)
State MV In-Lieu $4,947 $4,537 (8.3%)
HURF $8,198 $7,085 (13.6%)
Primary Prop Tax $2,110 $2,186 3.6%
All Other $17,713 $14,352 (19%)
1, ,a1dT'atal * $92,197 $83,271 (9.7%)
3jrzt,,A i
GF revenue receipts through the second quarter of FY 2008-09 are $8.9 million or 9.7%
less than the same period in the prior FY.
City sales tax collections of $26.7 million are $4.4 million or 14.1% less than the $31.1
million collected through the second quarter of the prior FY.
State-shared revenue collections, which include income tax, state sales tax, and motor
vehicle in-lieu receipts, of $32.9 million are $128,000 less than the $33 million collected
through the second quarter of the prior FY.
The All Other category is $3.4 million less than last year's collections primarily due to a
decrease in development services fees.
The following chart reflects the year-to-year comparison for revenue collections, but by
quarter rather than as a total.
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Actual;Revenues
0noous)
$100,000
$90,000
$80,000
4+4444-4-4444.4.4444...4.444
$70,000 _ ; :'
$60,000 t _$40x$6 ♦
$60,000
$40,000 •
$30,000 •
$20,000 $44,434 $42,411
$10,000 •
$0
FY 2007-08 FY 2008-09
❑First Quarter o Second Quarter
General Fund Expenditures
The FY 2008-09 budget expenditures and actuals for the GF operating and pay-as-you-
go (PAYGO) capital expenditures are shown in the following table.
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Expenditures Comparison
Budget to Actuals, FY 2008-09
fry' j �, '1 �' G` �� ' = FY 2008-09 FY 2008-09 Amount
YTD Budget YTD Actuals Under/(Over)
Budget
GF Salaries/Benefits $62,338 $60,770 $1,568
GF Non-Personnel $2603 $23,561 $3,122
GF Debt Service(leases) $1,458 $865 $593
PAYGO Capital $3,198 $1.162 $2,036
TOTAL $93,677 $86,358 $7,319
Overall, the second quarter actual expenditures are $7.3 million or 7.8% less than the
amount budgeted.
Designated Sales Tax Receipts
At the end of the second quarter, the transportation sales tax budget to actuals
comparison shows that this fund collected $2.2 million less than the amount budgeted.
YTD Comparison
Budget to Actuals, FY 2008-09
(in 000s)
"gauln FY 2008-09 FY 2008-09 Percent
Budget Actuals Over/(Under)
�'
- Budget
Transportation $13,403 $11,242 (16.1%)
Sales Tax
The following table shows a comparison of budget to actuals for FY 2008-09 for the two
components of the public safety sales tax.
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YTD Comparison
Budget to Actuals, FY 2008-09
(in 000s)
+7? FY 2008-09 FY 2008-09 Amount
Lily-1,r, LLic, Budget Actuals Over/(Under)
'PJ k Budget
1, tS L Fryi t tit ii Hr .04 .' 1
Police sales tax $7,958 $6,323 (20%)
Fire sales tax $3,933 $3,158 (20%)
At the end of second quarter, the police component of the public safety sales tax was
$1.6 million less than the budget and fire was $775,000 less than the budget.
Similar to the General Fund, the expenditures of these funds are being paced to match
the revenue levels.
This is a status report on the General Fund for Council's information covering the
second quarter report for FY 2008-09.
Mr. Ed Beasley prefaced the next item. He indicated that staff will review the 2nd quarter
status report regarding revenues and expenditures from July to December. However,
the December Christmas numbers were not available. He commented on the current
challenges the city has had during these hard economic times and the measures that
they had put in place. The internal measures included voluntary furloughs, hiring
freezes, contract position reviews and retirement packages.
Mr. Art Lynch provided a brief overview of the economic cycle and its downturn. He
explained the downturn represented itself in a reduction in investment, spending,
reduction in labor force and contracting. He stated an added factor to this economic
downturn was the impact on the credit markets and the ability to borrow money being
frozen. He indicated this characteristic was extremely troublesome because of the
major scope of the struggling financial institutions. He explained this is affecting all
major businesses, both large and small with the inability to rely on the credit markets.
He discussed the workforce reduction experience the county was dealing with and
noted this was a widespread problem not only being felt in Glendale, but throughout the
country. He reported on the stimulus package being enacted which willaid the financial
market. He commented the city had dealt with economic downturns and slowdown and
throughout those times, the city has always had a plan to successfully weather the
storm and this was no different.
Mr. Skeete continued the discussion explaining how the national economic levels have
impacted the city and state. He stated the state impact was very similar to what was
going on around the country. He reported that the Arizona economy was built and
driven by growth, which drives tourism and residential. In states that the majority of the
revenue is derived from sales tax activity, growth, or the lack of it, has a large impact on
revenues. He stated Arizona has always been in the top for population and job growth,
however; in 2008, Arizona fell to number 48. The Glendale economy is slightly different
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from the rest of the state. While Glendale has not seen an absorbent amount of growth,
the city has fared as well as could be expected. He said overall, the recession has
seen a reduction in sales tax which represents a lack of growth.
Ms. Schurhammer reviewed the PowerPoint presentation. She explained that the
bottom line for the general fund was that revenues were about $9.3 million dollars less
than budgeted. However, this shortfall in revenue is offset by the fact that expenditures
are $7.3 million dollars less than budgeted. Results of revenue collection in the second
quarter reflect the more challenging economic conditions which have dominated the
news the last several months. The collections shown do not reflect the December
Christmas sales at the retail level. She explained those numbers will be reflected in the
third quarter report. She reported sales tax has been impacted the most with this year's
collection being about $4.4 million dollars less for the city's tax and about $800,000
dollars less for state sales tax. She explained the state's tax was faring better than the
city's because the state has a narrower sales tax base than the city of Glendale. She
commented that the slowdown also shows a decline in construction and related permit
fees. She stated that measures have been enacted to combat the challenges the city
faces with the steps as outlined by Mr. Beasley. She noted a report will be provided on
all the measures that will be used and enacted as part of the budget workbook. She
reviewed the budget process that will be started with discussions on March 17, 2009.
Councilmember Clark asked for further clarification on the budget shortfall. She asked
how they will be making up a loss of $1.5 million YTD as depicted in the budget. Ms.
Schurhammer explained as part of the expenditure reductions, that will be implemented,
they are expected to generate a savings of $1.5 million. The next round of reductions to
be implemented immediately, are expected to generate $2.5 million. Councilmember
Clark asked if any of Glendale's services have been impacted or compromised because
of these reductions. Ms. Schurhammer replied they had not. Councilmember Clark
asked for assurance that trash collection, police and fire, as well as libraries and parks
to date have remained the same. Ms. Schurhammer responded those items had not
been impacted. Councilmember Clark remarked what she understood was that
reductions thus far have only been internal. Ms. Schurhammer stated she was correct.
Councilmember Goulet commented on the many entities outside the city that provide
services of all sorts to Glendale. He asked if they had factored in if any of those
businesses were unable to perform under contract, would that force the city to provide
that service. Mr. Skeete explained the city was constantly monitoring contracts from
outside entities and at this point, they have no indication of anyone failing to deliver. He
added that during the budget process for next year, they will be doing a more in-depth
analysis of the matter and develop "what-if' scenarios.
Mayor Scruggs commented on the economic downturn and how it has continued. She
noted even though December's numbers were not in, she does not believe those
numbers will be strong enough to save the budget trend. She suggested looking further
into the future, not only the next quarter. She reported how other cities have been
projecting numbers far into the future with dire results. She noted they need to
implement a longer range plan to look into the future, such as what other cities were
doing with five-year plans. She said she does not see this being over soon and
believes there will still be problems after 2010. She also discussed drawing down the
general fund balance as one of the answers. Ms. Schurhammer explained she agrees
and a portion has already been built into this year's budget.
Mayor Scruggs remarked sales tax was a huge component of everyone's budget.
Glendale's fund balance at the end of first quarter of 08/09 was $39,277,000, which falls
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short of staffs goal of $60 million. She thanked Mr. Lynch and staff for their leadership
and guidance in making sure this component stayed a priority. She explained she
appreciated all the professional advice that was not always well received because it was
always more fun to spend money; however, with staff guidance they had this fund to fall
back on. She noted that in those instances where the sales tax is not sufficient to meet
the bond debt, the result would be to acquire it from the general fund balance. Mr.
Skeete replied it generally works that way.
Vice Mayor Martinez commented on the 1st quarter report being better than most cities
fared. He noted everyone knew it would get worse before it got better. He thanked Mr.
Beasley for his leadership and appreciated the steps that had been taken. He asked
staff to explain the voluntary furloughs further. Mr. Skeete stated at the beginning of
last week, employees were asked to volunteer and accept the furloughs from now to the
end of the fiscal year. The feedback received has been that those employees were
willing to participate at some level. He stated everyone recognizes the reality of the
situation and are willing to help where possible. He will present the final numbers by the
end of next week.
Vice Mayor Martinez commented that the numbers provided thus far do not seem to be
as bad as expected; however, believes it might get worse in the future and asked what
staff expects in the future regarding the economy. Mr. Schurhammer noted the
economists predict a slow turnaround beginning about a year from now. She discussed
how the stimulus package might aid in the economy's turnaround by putting more
money in people's pockets. Vice Mayor Martinez rejected the idea that the economy
will turn around in a year and believes it will take much longer than that. He related that
there have been very few people not affected by this economy, starting with job and
house losses and hard times being felt by many. He explained they had been through
some recessions before; however, nothing like this one. He stated at the November
retreat he had eluded to the fact that some programs will have to be cut, at least
temporarily. He asked if staff had some sort of list of possible cuts in programs or
areas. Mr. Beasley commented they do have those cuts included in this budget cycle
report. He explained many did not know that the city has no choice but to balance their
budget, and cities have to do whatever is necessary. He remarked that part of that
process could be service cuts, depending on what happens. However, those cuts will be
a policy decision. The budget will reflect choices and steps that would have to be made
and what has been done to date. It will also show what those choices will do to the
revenue savings. He explained that before they start laying-off employees, they will
enact voluntary furloughs, and if need be, progress to mandatory furloughs and
mandatory retirements. Additionally, there will be lay-offs and program cuts if needed.
He added they were already looking to the next quarter.
Mayor Scruggs spoke to the unfairness of voluntary furloughs. She stated these people
were being asked to give up and sacrifice part of their pay for others to keep their jobs.
She understood that this was a necessary process, however, believes something
should be done about this matter. She stated it seemed this was an unfair process
which could affect someone's retirement fund. Mr. Beasley replied he understood her
point; however, for that reason, they were doing everything possible to minimize the
consequences, such as meeting with the employees to help them understand their
options and help them with the process. He explained depending how the process is
carried out, it might have very little impact on their retirement fund.
Mayor Scruggs commented on the impact this could have on people's retirement in the
long run and would like to possibly find a way to lessen their consequences down the
road. She added she would hate to have people suffer long range penalties because
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they were trying to be helpful. She remarked she had looked into possibly modifying
her own salary; however, found it was involved, since it was in the Charter.
Councilmember Lieberman commented on the stimulus package and the general belief
that it will not make much of a difference. He discussed how the government will be
borrowing about a trillion dollars from China, which the interest alone, will take away
operating dollars from the federal government. He remarked it seemed the only way to
catch up would be to devaluate the dollar as it had been done once in the last twenty
years. He cautioned people on what they were hearing about the national economy and
stressed it was not looking positive, should they rely on the stimulus package. He
asked Ms. Schurhammer how much more they anticipate they will be drawing down
from the general fund, between now and the start of the next budget year in paying the
debt. Ms. Schurhammer stated the general fund started the year at $49.5 million and
staff will have more information when they unveil the budget package next month.
Councilmember Lieberman commented that what he would like to know next month was
the amount being drawn down from the general fund and how much the debt was in
dollars and cents, as well as how much a month was paid on the debt.
Councilmember Lieberman remarked on how the revenue process was reported. He
stated they should have had exact figures for December by now and does not agree
with not knowing the impact the Christmas season had on revenue. He noted he liked
the accrual-based information, rather than cash information as that was how he has
always run his businesses. Ms. Schurhammer explained property tax information will
also be included in their budget workbook on March 17, 2009.
Mayor Scruggs remarked the general fund balance information to date was $39.7
million. Ms. Schurhammer stated she was correct. Councilmember Lieberman
responded that by his calculation, that figure ended in September of 2008. He would
like the most current information on the general fund balance for the budget meeting.
Ms. Schurhammer agreed to provide him that information after the meeting.
Vice Mayor Martinez commented on Councilmember Lieberman's comments on the
timeliness of the revenue information. He asked Ms. Schurhammer to provide a
timeline of how and when those figures are collected and reported. Ms. Schurhammer
stated those figures were due in January, which included a small grace period. The
information is then processed and calculated which takes a bit longer at the end of the
year. He asked if it was possible to have that information earlier. Mr. Skeete explained
they had found the difference in the accrual and cash information had a small difference
and believes the extra time needed was used to make sure all the information was
accumulated and processed. Councilmember Lieberman remarked that the last report
was off by half a million dollars. Ms. Schurhammer commented they provided revenue
information in the same manner the state does, therefore, are now consistent with the
state in how revenue was provided and processed. Mayor Scruggs commented she
they too were not providing December numbers.
Councilmember Clark asked when they were expected to see those December numbers
since it was now the middle of February. Ms. Schurhammer stated Council will be
receiving those figures in an email. Councilmember Clark thanked Ms. Schurhammer.
Mayor Scruggs summarized they will be receiving a booklet for the upcoming budget
process with critical information and asked staff if that was the case. Ms. Schurhammer
responded, yes. She added the booklet will include the recommended budget and
capitol plan in accordance with previous years. It will also include a summary by
department of reductions that have been implemented. Mayor Scruggs reiterated her
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concern that the city was not doing enough to look to the future as other cities were
doing. She referenced Vice Mayor Martinez's comments on the economy. She
explained she would feel more comfortable and believes the Council feels the same in
having a longer plan which includes the next three to five years. She suggested using a
workshop setting to discuss this issue. Mr. Beasley explained they could start on a plan
of action; however, cautioned not every city was the same and believes a five-year
projection was too broad a time frame. He noted this recession could last two to three
years. He would caution implementing plans and projecting losses that might not
happen since the economy changes regularly. He suggested an 18 month to two year
plan might be more suitable. Mayor Scruggs remarked she believed those kinds of
projections were extremely important when they look at spending money for new
activities or maintaining existing ones. She discussed how ASU was now in trouble and
proposes campus closings because they had not been prepared. She remarked she
wanted Glendale to be prepared or at least have a long range plan for which to turn.
Councilmember Clark commented on past years where staff had provided number
projections five years out. She stated these numbers had been merely guesses and not
reliable at all. She explained she would like to see numbers for the following year and
believes those numbers which represent the current economy will be fairly accurate.
She believes anything further than a year was guess work because no one knows when
the economy will turn around or how much worse it will get.
Mayor Scruggs reiterated her stand on the importance of having projections for at least
the next three years. In response to Councilmember Clarkes's comments, she
suggested providing each Councilmember with what they were comfortable with, as for
her, she would like to see projections for three years out. Mr. Skeete responded staff
has always provided the same information to each of the Council members, therefore,
each member can choose to disregard any information they do not see fit entertaining.
Mayor Scruggs commented on the city never wanting a multiyear budget; however,
sees the benefit of having one in place that might possibly provide a road map of what
actions would be taken if situations improve or decline. Councilmember Frate stated it
would be good to have even if they were only projections.
Councilmember Frate read from the NLC survey. In summary, it stated that all cities
expect the current economic hardship to continue well into 2009. Ninety two percent of
all cities expect to have trouble meeting their city needs throughout the year. Eighty
three percent of city finance officers have already responded to economic downturns by
cutting expenditures and services. Eighty percent anticipate making further cuts in the
next fiscal year. Most cities reported hiring freezes and staff layoffs, as well as delaying
capital projects. He stated one in five city finance offices reported across the board
service cuts up to 22%, in areas such as libraries, parks and recreation. He noted that it
was interesting to see this trend was occurring nationally and was not only happening in
Arizona. He remarked each city was unique in how they will handle this crisis, as well
as dealing with budget and services to their residents.
ADJOURNMENT
The meeting was adjourned at 4:05 p.m.
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