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CC SR 20210330 02- SR FY 21-22 Budget Assumptions FINAL CITY COUNCIL MEETING DATE: 03/30/2021 AGENDA REPORT AGENDA HEADING: Regular Business AGENDA TITLE: Consideration and possible action to begin developing the FY 2021-22 Preliminary General Fund Budget. RECOMMENDED CITY COUNCIL ACTIONS: 1. Review the budget assumptions used to develop the FY 2021 -22 Proposed General Fund Budget and provide Staff with direction on the following: • Affirming the FY 2021-22 budget assumptions which include: i. Restoring 100% funding for the Permit Technician, Building Official, and Assistant Planner positions. ii. Maintaining the 3% Utility User Tax for FY 2021-22. • Funding priorities for the FY 2021-22 City Council goals. • Funding priorities for the projected surplus for FY 2021 -22 (projected revenues less projected expenditures) which may include: i. Funding options based on the new Pension Guidelines. ii. Funding options based on the revised City Council Policy No. 41 Reserve Policies. FISCAL IMPACT: N/A Amount Budgeted: N/A Additional Appropriation: N/A Account Number(s): ORIGINATED BY: Christopher Browning, Senior Administrative Analyst Vina Ramos, Deputy Director of Finance REVIEWED BY: Trang Nguyen, Director of Finance APPROVED BY: Ara Mihranian, AICP, City Manager ATTACHED SUPPORTING DOCUMENTS: A. City Council Goals Budget Requests B. Draft FY 2021-22 City Council Goals and Work Plan BACKGROUND: The City’s budget is a financial plan based on anticipated revenues and expenditures in a fiscal year starting July 1 through June 30. Each year, the City’s budget is prepared 1 applying the City’s long tradition of fiscal responsibility, prioritizing public safety, and providing the highest possible service levels to the community. To start the process, the City Council holds workshops on goals and the proposed budget which document the General Fund budget assumptions based on mid-year and year-end figures that frame the following year's budget. Prior to presenting to the City Council, Staff reports the General Fund budget assumptions to the Finance Advisory Committee (FAC) and the capital projects to the Infrastructure Management Committee (IMAC). In general, the City Council’s budget process this year consists of the following: In preparation of the FY 2021-22 Budget Workshop, Staff has prepared a list of assumptions used in the development of the FY 2021 -22 Proposed General Fund budget. For the second consecutive year and based on the available information at this point in time, Staff included the potential impacts from the economic downturn resulting from the COVID-19 pandemic. The details are reported in the sections of the staff report, where applicable. These assumptions have also been incorporated into the City’s five-year model to forecast the City’s financial position over the next five years. This future forecast helps determine the direction Staff needs to take to maintain a structurally balanced budget. Over the past two months, several meetings were held between the City Manager, Director of Finance, and Department Heads to build the proposed budget. The meetings started with a baseline budget for FY 2021-22 by discussing the status of the current budget, year-end outlook, and the potential changes for services or programs that were approved by the City Council in the current year. Additional changes were also made to account for regulatory/mandated changes, contractual obligations, and department requests, while incorporating cost containment in response to the economic downturn. Based on the discussions from these meetings, Staff prepared this staff report with an emphasis on the General Fund. The information presented tonight for the City Council’s review and input are as follows: • FY 2020-21 General Fund Year-End Estimates • FY 2021-22 Revenue Assumptions • FY 2021-22 Expenditure Assumptions City Council Goals Workshop February 22 Budget Workshops March 30 (GF) April 12 (CIP) Preliminary Budget May 18 Public Hearing June 1 Budget Adoption June 15 2 • FY 2021-22 Fund Balance Summary • Overview of the Five-Year Model and Assumptions • Maintaining the 3% Utility User Tax for FY 2021-22 • City Council Directions on Other Funding Priorities Furthermore, the information before you tonight have also been reviewed by the Finance Advisory Committee (FAC). The FAC’s recommendations and/or comments are included in the Additional Information section of this staff report. DISCUSSION: FY 2020-21 General Fund Year-End Estimates Staff estimates the fund balance for the General Fund on June 30, 2021 to be $22.6 million, including transfers out. The estimated fund balance is projected to increase by $1.2 million or 6% from the revised budget. After applying the City Council Reserve Policy of 50% of the operating budget, the estimated unrestricted excess reserve will be $9.6 million, which is an increase of approximately $1.9 million or 24% from the revised budget. While the revenues are projected to come in lower than estimated by $1.2 million over the revised budget, the significant increase in excess reserves are from the combination of the reduction in transfers out and the reduction of the 50% City Council Reserve Policy. A summary of the FY 2020-21 Fund Balance calculation is illustrated in Table 1 below. A detailed analysis of the year-end report is also presented tonight in a separate staff report. Table 1: FY 2020-21 General Fund – Fund Balance Summary General Fund FY 2020-21 Adopted Budget FY 2020-21 Additional Appropriations FY 2020-21 Revised Budget FY 2020-21 Year-End Estimates Beginning Fund Balance - 7/1/2020 21,748,709 21,748,709 21,748,709 Add: Revenues 28,969,900 28,969,900 27,748,100 Add: Transfers-In 230,000 230,000 230,000 Total Revenues 29,199,900 - 29,199,900 27,978,100 Less: Expenditures (26,836,900) (516,486) (27,353,386) (25,975,585) Less: Transfers to CIP (1,934,000) (206,500) (2,140,500) (1,117,200) Less: Other Transfers-Out (30,000) - (30,000) (30,000) Total Expenditures (28,800,900) (722,986) (29,523,886) (27,122,785) Unaudited Ending Fund Balance - 6/30/2020 22,147,709 (722,986) 21,424,723 22,604,024 50% Reserve Policy 13,418,450 - 13,676,693 12,987,793 Unrestricted Excess/(Deficit) Reserve - 06/30/21 8,729,259 (722,986) 7,748,030 9,616,232 3 General Fund — FY 2021-22 Revenue Assumptions Overview For the development of the FY 2021-22 proposed budget, Staff has factored in several revenue and expenditure assumptions to the FY 2020-21 base budget as well as targeted several cost saving actions. Staff estimates General Fund revenues will reach $29.7 million, an increase of approximately $520,000 or 1.8%, compared to the FY 2020-21 current budget and $1.7 million or 6.2%, when compared to the FY 2020-21 year-end estimates, including transfers in. The effects of the COVID-19 pandemic have remained throughout FY 2020-21 and it is still yet unknown how long the economic slowdown will linger. Although there is still much unknown about the future recovery of our economy, Staff can provide the City Council with its best estimates using the information available. Staff will continue to monitor economic conditions and work with our consultants to update revenue projections and assumptions as necessary. Below is a detailed discussion and analysis of the General Fund’s major revenues sources. Property Tax Property Tax continues to be the largest and historically most stable revenue source in the City. Revenue is projected to reach over $14.9 million, an increase of 4.9% over FY 2020-21 year-end estimates. Revenue growth primarily comes from growth in assessed property values, which is capped at 2% annually. Additional growth can come from home sales which trigger property reassessments and Proposition 8 value recaptures. There are three primary factors that determine the annual change in property tax revenue received by the City: • Inflation (Based on the California Consumer Price Index – CCPI) All properties not reduced by Proposition 8 are subject to a maximum CCPI increase of 2% annually. For FY 2021-22 the County Assessor will be applying a 1.036% increase to these properties resulting in a $138 million increase to real property value within in the City. • Transfer of Ownership (Sale of property to new owner) For those properties that have sold between January and December 2020, the increase in value has been factored into the property tax revenue calculation and provided an additional $294 million in property value. • Proposition 8 Recapture (Additional increase in assessed property value) Proposition 8 allows for properties that have experienced a decrease in value due to a downturn in the housing market to have the value used in the calculation of their property tax be based on the current market price. As home values 4 recover, properties that received this this relief can experience an annual increase in assessed value at a rate greater than the 2% CCPI limit mentioned above. This recapture in value accounted for an additional $41 million in property value. The three factors mentioned above plus several other factors used in the calculation of property tax combined to make an expected 3.52% increase in overall property value. This increase plus Property Tax Transfer revenue, which is generated when a property is sold, property tax revenue received in lieu of vehicle license fees, and other small revenue sources were used in creating the projection of almost $15 million for FY 2021- 22. Property Taxes FY 19-20 Actual Revenue: $14,183,892 FY 20-21 Year-end Estimate: $14,260,700 FY 21-22 Proposed Budget: $14,960,300 FY 21-22 Net Change: +$699,600 or 4.9% Transient Occupancy Tax (TOT) The City projects it will receive $3.5 million in TOT revenue, an increase of 46.8% when compared to FY 2020-21 year-end estimates. Since the temporary closure of Terranea Resort and all amenities from March 19, 2020 through May 10, 2020, and several months of Stay-at-Home orders that were put in place across the state, TOT revenue has been challenging to project. It is still unknown how demand for leisure travel will be impacted as the vaccine rollout continues and the state slowly reopens. For this reason, Staff has taken a conservative approach and assumed a more substantial reduction in revenue during the 1st quarter of FY 2021-22. Revenue from July through September will be estimated at 40% of revenue received during the last unaffected fiscal year, FY 2018-19. From there, revenue will be projected at 70% of FY 2018-19 levels through the second quarter and 75% through the remainder of the fiscal year. Of the $3.5 million of TOT, $3.3 million or 97% is from Terranea. Staff will continue to monitor revenue and economic trends and will provide updates accordingly. Transient Occupancy Tax FY 19-20 Actual Revenue: $3,909,799 FY 20-21 Year-end Estimate: $2,366,000 FY 21-22 Proposed Budget: $3,472,500 FY 21-22 Net Change: +$1,106,500 or 46.8% Sales and Use Tax During Staff’s preliminary analysis, revenue is projected to increase by $191,100 or 9.7% reaching over $2.1 in FY 2021-22 when compared to the FY 2020-21 year-end estimate. This growth is projected to be the result of a more stable and consistent 5 reopening of businesses across the state. This estimate brings revenue in line with what the City received during FY 2019-20. As we proceed through the remainder of FY 2020- 21, a clearer picture should develop of future sales tax revenue . Staff will continue to monitor this revenue source and provide updates if necessary. Sales and Use Tax FY 19-20 Actual Revenue: $2,163,342 FY 20-21 Year-end Estimate: $1,972,300 FY 21-22 Proposed Budget: $2,163,400 FY 21-22 Net Change: +$191,100 or 9.7% Permits and Fees This revenue source is comprised of roughly 17 permit and fee types, such as building and safety permits, plan check permits, planning and zoning permits, and animal licenses. Due to the variety of items, revenue can vary from year-to-year. The Community Development Department, which brings in over 93% of all license and permit revenue, estimates that this revenue source will see a slight increase of $78,000 or 4.3% over the FY 2020-21 year-end estimate of $1.8 million, bringing total revenue to $1.9 million. Staff will continue to monitor the situation and will work with the Community Development Department to provide updates to revenue projections if necessary. Permits and Fees FY 19-20 Actual Revenue: $1,916,822 FY 20-21 Year-end Estimate: $1,805,500 FY 21-22 Proposed Budget: $1,883,100 FY 21-22 Net Change: +$77,600 or 4.3% Franchise Tax Staff is projecting franchise tax revenue will remain flat when compared to FY 2020 -21 year-end estimates, with $2.15 million in revenue. The City receives payments from franchisees for the use of municipal rights-of-way. This revenue source is primarily received from Southern California Edison and Southern California Gas Company. The main drivers for this revenue are the consumption and price of natural gas. Staff uses historical data and industry projections for this revenue estimate. FY 2021-22 revenue is projected remain relatively flat and Staff is not anticipating any significant impact to this revenue source. Franchise Taxes FY 19-20 Actual Revenue: $2,146,037 FY 20-21 Year-end Estimate: $2,150,000 FY 21-22 Proposed Budget: $2,150,000 FY 21-22 Net Change: +$0 or 0% 6 Utility User Tax (UUT) UUT is dependent on outside factors including weather conditions, consumption of utilities, natural gas prices, and rate increases. Staff used historical data, information available pertaining to the price of natural gas, and the projected increases estimated by the Bureau of Labor Statistics for the Consumer Price Index for All Urban Consumers (CPI-U) in the calculation of this projection. UUT revenue is on pace to reach FY 2020- 21 year-end estimates which are slightly higher than historical average. This is partially attributed to an increase in utility usage as a higher percentage of the population worked from home. For FY 2021-22, Staff projects revenue will return to levels experienced prior to the pandemic. A decrease of $184,700 or 8.8% when compared to FY 2020-21 year-end estimates is projected, however this brings revenue in line with FY 2019-20 levels of $1.9 million. UUT FY 19-20 Actual Revenue: $1,912,370 FY 20-21 Year-end Estimate: $2,099,700 FY 21-22 Proposed Budget: $1,915,000 FY 21-22 Net Change: -$184,700 or 8.8% At this time, Staff determines that the UUT rate of 3% continues to be a necessary revenue source for the City’s operating needs and therefore included in the FY 2021 -22 Proposed General Fund Budget. Staff seeks City Council affirmation on maintaining the 3% Utility User Tax for FY 2021-22. Other Taxes and Miscellaneous Revenues An overall decrease of $268,400 or 8.7% when compared to FY 2020-21 is projected for FY 2021-22. Other Revenue consists of over 20 unique revenue sources including business license tax, golf tax, interest earnings, rental/lease, and parking lot fees. This revenue source can vary widely from year to year due to the various revenue sources that are included in this category. Despite a significant loss of revenue from facility rentals, Point Vicente Interpretive Center (PVIC) sales, business license, and interest earnings, revenue is still expected to exceed FY 2019-20 revenue of $2.99 million by $102,000, reaching nearly $3.1 million in FY 2020-21. This is due primarily to $515,000 in federal grant revenue in the form of COVID-19 relief funds, which have been used to offset costs associated with the City’s response to the pandemic. Revenue in FY 2021-22 is projected to fall by $268,000, or 8.7%, to $2.8 million as facility rental and programs and events revenue recover but is offset by the loss of grant revenue. Other Taxes and Miscellaneous Revenues FY 19-20 Actual Revenue: $2,991,743 7 FY 20-21 Year-end Estimate: $3,093,900 FY 21-22 Proposed Budget: $2,825,500 FY 21-22 Net Change: -$268,400 or 8.7% In total, FY 2021-22 General Fund revenues are estimated to reach $29.7 million, an increase of roughly $1.7 million or 6% from FY 2020-21 year-end estimates of $28 million. Table 2: FY 2021-22 Proposed General Fund Revenues Chart 1: FY 2021-22 Proposed General Fund Revenues FY 2021-22 Revenue Current Budget Year-End Estimate Proposed Budget Property Tax $14,129,700 $14,260,700 $14,960,300 $699,600 4.9% Transient Occupancy Tax 3,762,500 2,366,000 3,472,500 1,106,500 46.8% Sales Tax 2,312,300 1,972,300 2,163,400 191,100 9.7% Permits & Fees 1,819,200 1,805,500 1,883,100 77,600 4.3% Franchise Tax 2,167,500 2,150,000 2,150,000 0 0.0% Utility Users Tax 2,099,700 2,099,700 1,915,000 (184,700)-8.8% Other Taxes & Misc. Revenues 2,679,000 3,093,900 2,825,500 (268,400) -8.7% Subtotal $28,969,900 $27,748,100 $29,369,800 $1,621,700 5.8% Transfer 230,000 230,000 350,000 120,000 52.2% Total Revenues $29,199,900 $27,978,100 $29,719,800 $1,741,700 6.2% FY 2020-21 FY21-22 Proposed Budget vs. FY20-21 YE Estimates 8 As illustrated in Chart 1 above, Property Tax continues to be the largest and historically most stable revenue source in the City projected to be 51% of the total General Fund revenue. TOT is expected to be the next largest revenue source at 12% of total revenues. Chart 2 below shows the General Fund Revenues by type and their respective contribution in percentage (%) terms to the City’s overall total revenue. Chart 2: FY 2021-22 Proposed General Fund Revenues FY 2021-22 General Fund Expenditure Assumptions Overview Based upon the most current information available, the estimated proposed operating budget for General Fund is $26.9 million, excluding transfers out, which is less than the FY 2020-21 revised budget by $428,200 or 2%. The transfers-out is estimated at $1.9 million, a decrease of $319,200 or 15% over the FY 2020-21 revised budget. The total proposed budget including transfers out is $28.8 million, a decrease of $747,400 or 3% over the FY 2020-21 revised budget. As previously mentioned, during the development of the FY 2021-22 budget assumptions, Staff accounted for regulatory/mandated changes, contractual obligations, and department requests, while incorporating cost saving methods. Although the total budget has a decrease of $747,400 or 3% over FY 2020-21 revised budget, there are estimated increases in FY 2021-22 from various categories. The major increases are a combination of the new rates from the Los Angeles County Sheriff for public safety services, equipment replacement charges, salaries, and benefits. As illustrated in Table 3 below, the increases are then offset by the savings from repairs and maintenance, professional and technical, legal services, supplies, and lower transfers out based on projected TOT revenues. 9 Table 3: FY 2021-22 Proposed General Fund Expenditures A detailed analysis highlighting the budget assumptions that were used to prepare the General Fund proposed expenditures in FY 2021 -22 are discussed as follows: Personnel Costs Personnel costs account for the salaries and benefits for City employees, including full- time, part-time, City Council, and Planning Commissioners. Overall, based on the assumptions, the personnel budget is estimated at $11.8 million or 41% of the budget, including transfers out. This is an increase of $751,000 or 7% over FY 2020-21 revised budget, which is highlighted below. Personnel Costs FY 20-21 Revised Budget: $11,075,000 FY 20-21 Year-end Estimate: $10,093,000 FY 21-22 Proposed Budget: $11,826,000 FY 21-22 Net Change: +$751,000 or 7% Salaries Currently, the City is in the collective bargaining process with the Rancho Palos Verdes Employee Association (RPVEA). The agreement for next fiscal year has not been finalized, hence, Staff estimated personnel costs for FY 2021-22 using the same terms from the contract that is currently in place. Additionally, a majority of the vacant positions are assumed to be restored by FY 2021-22 and therefore included in the personnel costs. In February 2021, the City Council also approved a new parking enforcement program to address parking and access issues at the Palos Verdes Nature Preserve. The budget assumptions include the new positions related to this program. Although the new program increased the budget, Staff anticipates the revenues from parking fees and fines that will offset a majority of the costs. Expenditure Type FY 2020-21 Revised Budget FY 2020-21 YE Estimates FY 2021-22 Proposed Budget Salaries 8,338,100$ 7,382,363$ 8,498,500$ 160,400$ 2% Benefits 2,736,900$ 2,710,515$ 3,327,400$ 590,500$ 22% City Attorney 975,000$ 905,000$ 940,000$ (35,000)$ -4% Sheriff Contract 7,110,900$ 7,101,900$ 7,150,200$ 39,300$ 1% Supplies 608,025$ 514,402$ 574,500$ (33,525)$ -6% Professional/Technical 3,025,946$ 2,887,200$ 2,256,700$ (769,246)$ -25% Repairs and Maintenance 3,067,940$ 2,958,620$ 2,492,400$ (575,540)$ -19% Training/Conference 311,400$ 258,231$ 325,100$ 13,700$ 4% Misc. Expense 1,179,175$ 1,257,355$ 1,360,400$ 181,225$ 15% Total Opreating Expenditures 27,353,386$ 25,975,585$ 26,925,200$ (428,186)$ -2% Transfers Out 2,170,500$ 1,147,200$ 1,851,300$ (319,200)$ -15% Total Expenditures 29,523,886$ 27,122,785$ 28,776,500$ (747,386)$ -3% Variance 10 The estimated budget for salaries in FY 2021-22 is $8.5 million, a projected increase of approximately $160,400 or 2% over the FY 2020-21 revised budget. The increased amount is a combination of restoring full funding for a few vacant positions and accounting for new staffing to support new programs approved by the City Council in FY 2020-21. To offset a majority of the increases, salary savings were proposed by continuing partial funding for some of the positions through deferring recruitments. The major budget assumptions that account for $8.5 million in salaries for FY 2021-22 are as follows for each department: • City Administration $1.5 million or 17% • Community Development $2 million or 24% • Finance $980,100 or 12% • Public Works $1.7 million or 21% • Recreation and Parks $2.1 million or 26% • $78,900 of over-time salaries The following highlights the major changes between the FY 2020-21 revised budget and the proposed FY 2021-22 budget. • $225,700 has been added to fund 100% for the Building Official and Assistant Planner positions in the Community Development Department. In the FY 2020-21 revised budget, both positions were funded at 75% and 50%, resp ectively, therefore, the net increase is $74,900 to fully restore the positions in FY 2021-22. • $65,500 has been added to restore the funding for the vacant Permit Technician position in the Community Development Department. • $250,300 accounts for COLA and merit increase for full-time employees based on current contract between the City and RPVEA. This budget amount is an estimated net decrease of $30,000 or 11% over FY 2020-21 revised budget due to the lower COLA anticipated in FY 2021-22. o COLA at 1% based on the January CPI-U o Merit/merit bonus at an average of 3% o Amounts are subject to change based upon the final agreement between the City and RPVEA. • $76,000 accounts for new programs for Parking Enforcement Staff at the Palos Verdes Nature Preserve. o Includes salaries for three part-time Staff, 25 hours a week. • To achieve the least amount of growth in salaries, the increases are offset by additional savings realized from streamlining the projections for Recreation and Parks part-time salaries, lower overall costs for newly hired employees and future employees, and underfilling the following positions: 11 • Staff Assistant I in the Public Works Department • Accountant in the Finance Department • Accounting Supervisor in the Finance Department • For cost savings, there are several vacant positions in the past few years that have been frozen and are excluded in the current FY 2020-21 revised budget. While some positions have been restored, the following positions continue to remain frozen in the budget assumptions for FY 2021-22: • Executive Assistant in the City Manager’s Office • Assistant Planner in the Community Development Department • Senior Engineer in the Public Works Department Staff seeks City Council direction on restoring 100% funding for the Permit Technician, Building Official, and Assistant Planner positions for FY 2021-22 as described above. Benefits The estimated Benefits for FY 2021-22 Proposed Budget is $3.3 million with a projected increase of approximately $590,500 or 22% over the FY 2020-21 revised budget. Most of the increases are attributed to the annual CalPERS unfunded actuarial liability payment, increases in benefit rates, and additional benefit costs for restored and new positions. The major highlights for the budget assumptions to develop benefits of $3.3 million for FY 2021-22 are the following: • $1 million for the CalPERS Unfunded Actuarial Liability payment, an increase of $208,000 or 26% over the FY 2020-21 revised budget. The payment is the City’s unfunded liability inclusive of current employees and retired employees that are in Tier 1, Tier 2, and Tier 3. Of the $1 million required payment, Tier 1 accounts for $971,600 or 97%, Tier 2 is $17,300 or 2%, and Tier 3 is $13,900 or 1%. • $643,600 for the CalPERS normal rate payment, a decrease of $21,600 or 3% over the FY 2020-21 revised budget. The payment is the City’s normal cost for current employees that are in Tier 1, Tier 2, and Tier 3. The payments are $259,00 or 40% for Tier 1, $181,500 or 28% for Tier 2, and $199,500 or 31% for Tier 3. • $1.7 million for health, dental, vision, worker’s compensation, Medicare, and other ancillary benefits. This an increase of $401,400 or 32% over the prior year’s revised budget. The increases are mainly from 5% estimated c ost increases for health benefits, increases in the contribution to Health Savings Account (HSA) aligned with the same amounts established by IRS (previously approved by the City Council in December of 2020), and additional benefits for the restored and new positions. 12 Non-personnel Costs The non-personnel category includes the Los Angeles County Sheriff contract, legal services, professional and technical services, repairs and maintenance, supplies, training and conferences, and miscellaneous/other expenses. This category represents $15.1 million or 52% of the proposed budget, including transfers out. The FY 2021-22 proposed budget includes a decrease of $1.2 million or 7% over FY 2020-21 revised budget. The decrease is a combination of the City taking the necessary and prudent steps reviewing operational spending to maximize budget. In particular, the majority of the reductions are due to Staff identifying maintenance costs that are eligible for funding from special revenue funds, such as Measure W and Measure R, instead of the General Fund. Additionally, Staff reviewed the line item budgets, performed analysis using historical information, and adjusted the budget accordingly. The adjustments were carefully reviewed by the Finance Department and Departments Heads with final approval from the City Manager to verify that the requested budgets accurately line up with the City’s anticipated needs, while maintaining current high service levels to the community. Non-Personnel Costs FY 20-21 Revised Budget: $11,075,000 FY 20-21 Year-end Estimate: $15,882,700 FY 21-22 Proposed Budget: $15,099,300 FY 21-22 Net Change: -$1,179,100 or 7% less The major highlights for the budget assumptions to develop the non-personnel budget of $15.1 million for FY 2021-22 are as follows: Sheriff’s Contract • Accounts for $7,150,200 or 25% of the proposed budget, including transfers out. • Includes Sheriff Contract increase of $101,000 or 1% over FY 2020-21 contract. The slight increase is due to dramatic budget curtailments and overtime mitigation. • Includes general law safety services and 11.5% liability insurance. Legal Services • Accounts for $940,000 or 3% of the proposed budget, including transfers out. • Includes general legal services, code enforcement, litigation, labor negotiation, and legal services related to public records act req uests. • Proposed budget is a decrease of approximately $35,000 or 4% from the prior year’s revised budget. The decrease is based on projected litigation needs in FY 2021-22. Professional and Technical Services • Accounts for $2,256,700 or 8% of the proposed budget, including transfers out. • Majority of this category includes managed information technology services, engineering, environment planning, code enforcement, flagging/crossing guard 13 services, recreation program instructors, special events, inspections, the peafowl program, other legal services, audit services, and other miscellaneous consulting services. • Proposed budget is a decrease of approximately $769,400 or 25% from the prior year’s revised budget. Most of the decreased amounts are as follows: o City Clerk’s election costs are estimated to decrease by $135,000 due to one - time costs from the prior year are no longer needed in FY 2021-22. o Public Works’ services are expected to have a net decrease over FY 2020-21 revised budget of roughly $364,000. The reduction is attributed to Staff identifying maintenance costs that are eligible to be funded from special revenue funds instead of General Fund. About $320,000 of the reduction in the General Fund is allocated to Measure W. Additionally, Staff identified further cost savings by maximizing and reducing c ontract costs. o Community Development’s services are expected to have a net decrease of about $101,000. The reduction is attributed to restoring the full funding for salaries of vacant positions. Therefore, augmentation of services for planning and building safety contract services is no longer needed in FY 2021-22. o The remaining $169,300 decrease in professional services is from various divisions including City Administration, Non-Department, and Recreation and Parks. The decreased amounts are a combination of identified costs savings and one-time services that are no longer needed in FY 2021-22. Repairs and Maintenance • Accounts for $2.5 million or 9% of the proposed budget, including transfers out. • Majority of this category includes licensing and support for technology services, tree trimming, landscapes and median maintenance, fuel modification, traffic control, custodial, graffiti abatement, building and park maintenance, and utilities. • Proposed budget is a decrease of approximately $575,500 or 19% from the prior year’s revised budget. Most of the decreased amounts are as follows: o Repairs and maintenance allocated in Public Works are expected to have a net decrease over FY 2020-21 revised budget of roughly $200,000. The reduction is attributed to Staff reviewing operational spending and identifying potential cost savings from various contracts. o Additional $100,000 reduction for pavement and marking maintenance services. Staff identified that this maintenance is eligible to be funded by a special revenue fund, Measure R. o Additional $165,000 from the Storm Water Quality maintenance was identified as eligible for Measure W funding. Supplies, Training and Conference, Miscellaneous Expense • The remaining non-personnel costs are supplies, training and conference, and miscellaneous expenses, which represent $2.3 million or 8% of the proposed budget, including transfers out. 14 • Majority of this category includes supplies for custodial, building, office, repairs, small equipment, parks, special events, programs, training and conference, bank fees, property tax assessments, general liabilities premium, and equipment replacement charges. • Proposed budget is an increase of approximately $161,000 or 8% from the prior year’s revised budget. The increase is mainly from increasing the funding for the equipment replacement charges that are saved for future purchases. Transfers Out Transfers out are considered a part of General Fund expenditures which include transfers to the CIP and other funds such as the City’s Improvement Authority for Portuguese Bend and Sub-region One. Transfer Out to CIP The transfer out of General Fund revenue to the CIP Fund has been a factor of the City’s public safety contract with the Los Angeles County Sheriff’s Department since FY2017-18. In FY 2017-2018, with the City Council’s goal to continue to enhance public safety services for the residents of Rancho Palos Verdes, the City Council approved reducing the TOT transfers to the CIP Fund by the cumulative annual increases in the public safety contract. As a result, the cost increases of the public safety contract reduced the transfers to the CIP. For FY 2021-22, Staff estimates receiving approximately $3.3 million in TOT revenue from Terranea. Based on this estimate, the TOT transfer to the CIP Fund is approximately $1.8 million or 6% of the proposed budget after applying the cumulative annual increases (since FY2017-18) of $1.6 million in the public safety contract as illustrated in Table 4. Table 4: FY 2021-22 Transfers Out to CIP Table 5 illustrates how the large drop in TOT revenue from Terranea combined with a gradual return to typical pre-pandemic revenue levels is projected to cause a sharp FY 2021-22 TOT Estimates (Terranea)$3,322,500 Less Public Safety Increases:($1,556,200) FY 2017-2018: $893,000 FY 2018-2019: $200,500 FY 2019-2020: $260,800 FY 2020-2021: $101,000 FY 2021-2022: $100,900 FY 2021-22 Proposed Budget - Transfer to CIP $1,766,300 15 increase in the TOT transfer to CIP in FY 2022-23. This is followed by a gradual decline as the annual increases to the Sheriff’s contract of roughly 6% on average outpace the much slower growth of expected TOT revenue as demand returns to normal. If all factors remain constant, it is projected that the General Fund’s TOT transfer to CIP will be phased out by FY 2029-30. Table 5: Impact to TOT Transfer to CIP Chart 3 illustrates that if the City were to cease the reduction of the General Fund transfers of TOT revenue from Terranea Resort by the annual cumulative increases in the Sheriff’s contract, and instead transfer the full amount, the expenditures would exceed General Fund revenues during FY 2022-23 by roughly $2.4 million. Chart 3: General Fund 10-year Trend, Transfer of All Terranea TOT Revenue FY 21-22 FY 22-23 FY 23-24 FY 24-25 FY 25-26 Terranea TOT Revenue $3,322,500 $4,860,900 $5,400,500 $5,427,500 $5,454,600 Public Safety Increase Since FY 17-18 $1,940,100 $2,394,700 $2,876,600 $3,387,400 $3,928,800 TOT Transfer to CIP $1,382,400 $2,466,200 $2,523,900 $2,040,100 $1,525,800 FY 26-27 FY 27-28 FY 28-29 FY 29-30 Terranea TOT Revenue $5,481,900 $5,509,300 $5,536,900 $5,564,500 Public Safety Increase Since FY 17-18 $3,974,900 $4,549,000 $5,157,600 $5,802,600 TOT Transfer to CIP $1,507,000 $960,300 $379,300 ($238,100) 16 To address the potential phasing out of General Fund transfers to CIP, in March 2021, the City Council approved the revisions of the City Council Policy No. 41, Reserve Policies addressing the funding sources for CIP. Pursuant to the revised policy, during the budget process, the City Council may reduce the General Fund transfer amount to the CIP by a portion or all of the increases in the public safety contract. Additionally, if deemed necessary, the City Council may allocate all or a percentage of the prior year’s General Fund unrestricted excess reserve to the CIP. This is further discussed in the next section of this staff report. Other Miscellaneous Transfers Out In terms of Sub-region One and the Improvement Authority, transfer outs are intended to cover annual maintenance charges and to maintain endowment requirements. Since the estimated interest earned in the funds are not enough to cover the costs incurred in these funds, the General Fund will need to transfer funds to subsidize Sub -region One in the amount of $30,000 and the Improvement Authority for Portuguese Bend for $55,000, totaling $85,000 for FY 2021-22. This is an increase of $55,000 or 183% from the prior year’s revised budget. The increase is mainly due to lower interest rates anticipated in FY 2021-22, along with increased demand for maintenance services that are requested by residents. In closing on expenditures, the following Chart 4 shows the General Fund expenditures by type and their respective contribution in percentage (%) terms to the City’s overall total expenditures. Chart 4: FY 2021-22 Proposed General Fund Expenditures Staff will continue to monitor the local California economy and the impact of the pandemic on revenues. Any changes to the budget assumptions used in the 17 construction of the five-year model will be updated when Staff prepares the draft model for review by the City Council in June. FY 2021-22 General Fund - Estimated Fund Balance Overall, based on the assumptions, Staff estimates the fund balance for the General Fund on June 30, 2022 will be $23.5 million, including transfers out. The estimated fund balance is projected to increase by $2 million or 10% from the revised budget. After applying the City Council Reserve Policy of 50% of the operating budget, the estimated unrestricted excess reserve is $10.1 million, which is an increase of approximately $2.3 million or 30% from the revised budget. A summary of the estimated FY 2021-22 Fund Balance calculation is illustrated in Table 6 below. Table 6: FY 2021-22 General Fund – Fund Balance Summary Five-year Model and Assumptions The City’s long-term financial outlook is documented in the Five-Year Model, which forecasts economic conditions including scenarios of future sources of revenues and future spending. The Mayor and the City Council recently asked staff to look into expanding the five-year model to a ten-year or longer model. Staff is working diligently with a consultant to explore opportunities for this transition. For FY 2021-22, Staff will continue with the current model and will come back to the City Council on a status of the ten-year model at a later date. The Five-Year Model is an additional tool that the City utilizes annually to engage discussions and provide guidance with decision-making related to the City’s future General Fund FY 2020-21 Revised Budget FY 2020-21 Year-End Estimates FY 2021-22 Proposed Budget FY 2021-22 Changes Beginning Fund Balance - 7/1/2021 21,748,709 21,748,709 22,604,024 855,315 Add: Revenues 28,969,900 27,748,100 29,369,800 399,900 Add: Transfers-In 230,000 230,000 350,000 120,000 Total Revenues 29,199,900 27,978,100 29,719,800 519,900 Less: Expenditures (27,353,386) (25,975,585) (26,925,200) (428,186) Less: Transfers to CIP (2,140,500) (1,117,200) (1,766,300) (374,200) Less: Other Transfers-Out (30,000) (30,000) (85,000) 55,000 Total Expenditures (29,523,886) (27,122,785) (28,776,500) (747,386) Unaudited Ending Fund Balance - 6/30/2022 21,424,723 22,604,024 23,547,324 2,122,601 50% Reserve Policy 13,676,693 12,987,793 13,462,600 (214,093) Unrestricted Excess/(Deficit) Reserve - 06/30/22 7,748,030 9,616,232 10,084,724 2,336,694 18 financial health. Table 7 on the next page summarizes the assumptions that were used to prepare the FY 2021-22 proposed budget and used as a baseline to create the current 5-year model. Table 7: Five-year Model Budget Assumptions Chart 5 below illustrates the 10-year trend for the General Fund revenues and expenditures, excluding transfers. For FY 2022-23 and beyond, the figures are based on the assumptions from Table 3 above. Revenues are estimated to grow on an average of 4.5% per year compared to expenditure growth estimated at an average of 4.4% per year. Chart 5: General Fund 10-year Trend, Excluding Transfers ECONOMIC MODEL INPUT FACTORS 2023F 2024F 2025F 2026F REVENUES PROPERTY TAX-NET GF ESTIMATE 4.0% 4.0% 4.0% 4.0% PROPERTY TAX-IN LIEU OF VLF (VLFAA) 4.0% 4.0% 4.0% 4.0% TRANSIENT OCCUPANCY TAXES 46.3% 11.1% 0.5% 0.5% SALES TAX 2.0% 2.0% 2.0% 2.0% FRANCHISE TAX 0.5% 0.5% 0.5% 0.5% UTILITY USERS TAX 0.5% 0.5% 0.5% 0.5% PERMIT REVENUES 0.0% 0.0% 0.0% 0.0% INVESTMENT INTEREST 0.8% 1.0% 1.0% 1.0% EXPENDITURES CONSUMER PRICE INDEX 2.0% 2.0% 2.0% 2.0% PERSONNEL EXPENDITURES 8.5% 4.5% 4.5% 4.5% HEALTH INSURANCE 2.0% 2.0% 2.0% 2.0% PERS NORMAL COSTS 2.0% 2.0% 2.0% 2.0% PERS UNFUNDED LIABILITY 10.1% 5.8% 5.7% 3.2% SHERIFF CONTRACT 6.0% 6.0% 6.0% 6.0% 19 As shown above, the operating revenues continue to support operating expenditures through FY 2025-26. Even when the transfer of Transient Occupancy Tax (TOT) revenue to the CIP Fund is applied, net of the public safety increases, revenues still exceed expenditures through FY 2025-26, as depicted in Chart 6 below. Chart 6: General Fund 10-year Trend, Including Transfers City Council Directions on Other Funding Priorities In addition to seeking the City Council’s direction on the FY 2021 -22 budget assumptions which includes restoring 100% funding for the Permit Technician, Building Official, and Assistant Planner, Staff seeks City Council direction for the other funding priorities described below to develop the FY 2021 -22 Preliminary Budget: • Funding priorities for the FY 2021-22 City Council goals. • Funding priorities for the projected surplus for FY 2021 -22 (projected revenues less projected expenditures) which include: o Funding options for the new Pension Guidelines o Funding options for the revised City Council Policy No. 41 Reserve Policies. According to the budget schedule, direction provided this evening, staff wil l present the preliminary budget at the next Budget Workshop on May 18, 2021. Funding Priorities for FY2021-22 City Council Goals On February 22, 2021, the City Council held its annual Goals Workshop to review the progress of the current FY2020-21 Goals and to set the framework for the upcoming FY2021-22 Goals. Based on direction provided at the workshop, on March 16, 2021, the City Council reviewed the draft Goals for FY 2021-22 and provided staff with further 20 direction on goals to be included and the priority. At this meeting, the City Council directed Staff to align funding with its draft goals. At this time, the updated draft goals for FY2021-22 are attached for reference purposes (Attachment B), and to consider amending if changes are identified with the proposed budget. To assist with the budget discussion as it relates to the goals, attached is a worksheet that extracts certain goals requiring funding through the budget process (Attachment A). Based on the discussion at tonight’s meeting and the upcoming CIP budget workshop scheduled for April 12, Staff will update the City Council Goals and present a more comprehensive report to review in May for eventual adoption with the City’s budget in June. Funding Priorities for Projected Surplus for FY2021-22 Over the past year, the Finance Department and the FAC have worked on creating and updating two of the City Council financial guidelines/policies addressing a financial plan for the pension liability and improving the reserve policies. Both were reviewed and recommended by the FAC in September 2020 through January 2021, and subsequently adopted by the City Council in February 2021 and March 2021. Based on the budget assumptions, Staff projects a surplus of over $943,000 for FY 2021- 22. In accordance with the recently adopted guidelines and policies, Staff seeks City Council’s direction on the funding priorities for this surplus. The following are v arious funding options for the City Council’s consideration: • CalPERS Pension Plan Guidelines: o City Council may set aside the first annual funding in an Employee Pension Plan Service Fund to relieve the General Fund of payment in excess of $900,000. o City Council may set aside the initial funding in an Employee Pension Plan Service Fund to relieve the General Fund of payment in excess of $900,000 equivalent to at least two years but no more than three years of the incremental increases to the annual UAL payment from the General Fund Unrestricted Excess Reserve to the Employee Pension Plan Service Fund. • The estimated amount of the incremental increase for two years is $307,000 or $640,000 for three years. • City Council Policy No. 41 Reserve Policies: o City Council may consider adjusting or suspending the reduction of the General Fund transfers to CIP based on the cumulative increases in the public safety contract when the General Fund does not have a balanced budget. 21 o If deemed necessary, City Council may allocate all or a percentage of the prior year’s General Fund unrestricted excess reserve to the CIP during budget adoption process. The estimated unrestricted excess reserve for FY 2020-21 is $10.1 million. Staff seeks City Council direction on how to allocate the projected surplus of over $943,000 for FY2021-22 based on the above options which may include one or any combination of the options provided. ADDITIONAL INFORMATION: American Rescue Plan Act of 2021 Over the next few months, the City Council will be asked to consider funding options on a possible City allocation from the $1.9 trillion American Rescue Plan Act of 2021. The Plan was approved by Congress and subsequently signed into law by President Biden on March 11, 2021. The relief package provides funding in several areas such as state and local aid, education, rental assistance, and transit. Based on the preliminary information that the City received from the Government Finance Officers Association and the League of California Cities, the City’s allocation under the state and local fiscal aid of $350 billion is estimated to be at $7.8 million. Based on the current information, the City will receive the allocation in two payments, the first one within 60-90 days after enactment, and the final payment one year later (likely part of FY2022-23). At this time, the estimated $7.8 million allocation is not included in the proposed budget because the City is still waiting for confirmation of the final allocation and for a more solid timeline on when the funds will be disbursed to the cities. The timing of the allocation disbursement affects the fiscal year during which the City can record this as revenue. Additionally, since this is a federal funding, the implementation can be an extensive process as new guidelines are being developed. The guidelines would help cities on how to properly spend the funds. That said, based on the most current information, eligible uses may include: • Revenue replacement for the provision of government services to the extent the reduction in revenue due the COVID-19 public health emergency relative to revenues collected in the most recent fiscal year prior to the emergency. • Premium pay for essential workers • Assistance to small businesses, households, and hard-hit industries, and economic recovery • Investments in water, sewer and broadband infrastructure. There are the following two restrictions on eligible uses: • Funds cannot be used to directly or indirectly offset tax reductions or delay a tax/tax increase. 22 • Funds cannot be deposited into any pension fund. Staff will continue to monitor this funding and will report any available updates in the Preliminary Budget meeting. Finance Advisory Committee’s Recommendations On March 18, 2021, Staff presented the FY 2021-22 General Fund budget assumptions, fund balance summary, and the Five-Year model to the FAC. At this meeting, FAC supported and appreciated the conservative approach that Staff has taken to develop the FY 2021-22 proposed budget. Lastly, FAC added the following recommendations for City Council’s consideration: • Utilize the American Rescue Plan Act of 2021 stimulus fund to invest in the City’s infrastructure. • Consider additional funding for trail maintenance due to the increase in usage. • Develop a creative funding approach by receiving donations from patrons for park usage. Review of Golf Tax Rancho Palos Verdes Municipal Code Section 3.40.140 requires a legislative review of golf tax every four years, to be completed prior to the adoption of the budget prepared for the corresponding next fiscal year. The golf tax ordinance directs the City Council to determine, based on the needs of the City, if any modification to the tax rate is necessary or if the tax should be repealed. In FY 2020-21, the City Council approved the golf tax without any modifications. Accordingly, the next review will be in FY 2023-24. CIP Workshop On Monday, April 12, 2021, the City Council will conduct a workshop on the Capital Improvement Program (CIP). At this workshop, staff will present the status of FY 2020- 21 capital projects, propose new capital projects, and the five -year CIP for discussion. Any direction provided by the City Council will be incorporated in the Preliminary Budget to be presented on May 18, 2021. Public Notification On March 15, 2021, the City posted on social media and issued a listserv message announcing tonight’s public workshop. To date, no public correspondence has been received. Any public correspondence received after the transmittal of this staff report will be provided to the City Council as late correspondence at the workshop. 23 CONCLUSION: Considering the ongoing financial impact of the COVID-19 pandemic, Staff continues to take a more conservative approach when preparing the FY 2021 -22 proposed budget. Similar to the prior year’s budget process, to alleviate the estimated revenue loss, the Finance Department in collaboration with the City Manager and Department Heads, determined the operational needs that are necessary to maintain current service levels for the upcoming year. Additional goals within this process were for the budget team to identify cost containments when possible from personnel and non-personnel budget line items, and to identify costs that are eligible for special revenue funds (grants). As a result, Staff estimates the General Fund revenues of $29.7 million will exceed expenditures operating revenues of $26.9 million by $2.8 million (surplus), before transfers out. After applying the transfers out of $1.9 million, the revenues will exceed expenditures by $943,200 (surplus). This would result in a $2.1 million increase in the fund balance over the FY 2020-21 revised budget, totaling $23.5 million. After applying the 50% City Council Reserve Policy, Staff estimates an unrestricted excess reserve of $10.1 million, an increase of $2.3 million from the FY 2020-21 revised budget. Any directions from the City Council tonight will be incorporated in the Preliminary Budget to be presented on May 18, 2021. 24 FY 2021-22 CITY COUNCIL GOALS BUDGET REQUESTS No.Goal Department Operating/ Capital?Budget? Budget Request Notes/Comments PUBLIC SAFETY Goal: Maintain a high level of public safety with public engagement. 1. Law Enforcement 1a Reduce Part I Crime by 5% for FY 2021-22 compared to FY 2020-21 Admin Operating Yes -$ Included in the operating budget 1b Expand Neighborhood Watch to five (5) new communities.Admin Operating Yes -$ Included in the operating budget 1c Provide $30,000 in grants to residents and neighborhood groups for the acquisition of safety-enhancing tools and technologies Admin Operating Yes -$ Included in FY 21-22 proposed budget 2. Emergency Preparedness 2a Prepare a Landslide Emergency Sanitation Plan in coordination with LA County Sanitation District on how to respond to an emergency break in the above-ground sanitation line located on Palos Verdes Drive South within the Landslide Area.PW Operating No -$ Will be done in-house 2b Implement at least two of the EPC-recommended action items to mitigate wildfire risk in RPV, including: Enhanced Emergency Communication; Emergency Evacuation Plan/Peninsula-wide and school district emergency preparedness plan; Wildfire Hardening; Public Safety Power Shutoff response; and Cal Fire Risk Assessment and Insurance Rates Admin Operating Yes -$ Included in the operating budget INFRASTRUCTURE Goal: Maintain and improve all public infrastructure (including transportation systems, parking, utilities, storm drains, and sewers). 3. Portuguese Bend Landslide 3a Complete the EIR for the Portuguese Bend Landslide Remediation Project for certification by the City Council PW Capital Yes -$ Proposed 2021-2022 CIP includes this request 3b Prepare funding opportunities for Phases 1 & 2 of the Portuguese Bend Landslide Feasibility Plan for City Council consideration. FIN Operating Yes -$ Carry-over from existing contract. 3c Develop a mitigation plan to address land movement at Altamira Canyon based on the following phases: Phase One - Perform the drainage/erosion analysis for the entire canyon and its tributaries and establish a priority list based on current erosion. Phase Two - Prepare detailed engineering plans to resolve the erosion and making sure there is positive drainage along the canyon. Phase Three - Award construction contract for the proposed improvements.PW Capital No -$ Carry-over from existing contract. 3d Develop a feasibility analysis with Rolling Hills for installation of an underground sanitary sewer system to replace the existing septic tanks to reduce ground water seepage within Portuguese Bend landslide.PW Operating No -$ 4. Asset Management 4a Create a detailed inventory and maintenance schedule of the City's public infrastructure and assets.PW Capital Yes -$ CIP includes request for $365,000 in FY2021- 2022 and additional $335,000 over FY22-FY23; which would create an asset management program for Roads, Sidewalks, Storm Drains, and Facilities. An asset management program for other such as Traffic Signals and Streetlights is being evaluated and funding requests will be made in future budget cycles. A-1 FY 2021-22 CITY COUNCIL GOALS BUDGET REQUESTS No.Goal Department Operating/ Capital?Budget? Budget Request Notes/Comments 5. Small Wireless Facilities 5a Develop a Citywide 5G Small Wireless Facilities (SWF) Master Plan that identifies the preferred and least intrusive locations to install small wireless facilities including co-locations. PW Operating No -Will be done in-house 6. Electric Utilities 6a In coordination with SCE, develop a Utility Resilient Advancement Master Plan to harden above-ground utility lines including a tentative timeline to potentially underground utilities; and continue to lobby the California Public Utilities Commission to modify the requirements for Rule 20A undergrounding funds to include high fire risk areas.PW Operating Yes 100,000$ $50,000 to $100,000 6b Identify alternative energy resources with the capability to store energy or sell it back to the grid system, which could power the City. The first phase is to identify potential alternative energy and the cost associated with this plan.PW Operating Yes 50,000$ $25,000 to $50,000 6c Increase electric system reliability and safety in the City by reducing the average amount of power outages by 25% compared to FY 2020-21 by the end of FY 2021-22 through the undergrounding of at least one mile of utility lines in open space areas.Admin Operating Yes -$ Included in the operating budget 7. Sanitary Utilities 7a Develop a public sewer program to encourage on-site sanitary sewer systems to connect to the public sanitary sewer system based on the following phases: Phase 1: Map areas in the City that are served by a sanitary sewer system or on-site sanitary sewer system.PW Operating No $ - Will be done in-house Phase 2: Feasibility study of the areas which are not currently being served and prioritize the need for installation of the sewer system and identify costs to connect to the sewer system.PW Capital Yes $ 100,000 Phase 3: Design the sewer system.PW Capital Yes TBD Estimated to be millions, Phase 4: Installation of the system.PW Capital Yes TBD Estimated to be multiple tens of millions 7b Prepare a new financial plan for the Abalone Cove annual sewer rates that reduces City maintenance subsidy by at least 50% for City Council consideration.FIN Operating Yes -$ Carry-over from existing contract. 8. Roadways 8a Develop a Citywide Speed Mitigation Plan for reducing vehicular speed within City streets (traffic calming)PW Capital Yes -$ CIP includes request for funding to develop plan in Fiscal 2021-2022 9. City Beautification 9a Develop an Arterial Fences and Walls Master Plan for the City Council's consideration that retains neighborhood identity and describes the type (material and height) of fence or wall, if any, to be placed along major arterial streets in the City.CDD Operating No 40,000$ 9b Create a City Entry Master Sign Plan at various points of entry to the City utilizing the following phases: Phase 1: Issue an RFP for the design. Phase 2: Design. Phase 3: Construction.PW Capital Yes 255,000$ CIP includes this project on needs/wants list with funding in a future year to be determined A-2 FY 2021-22 CITY COUNCIL GOALS BUDGET REQUESTS No.Goal Department Operating/ Capital?Budget? Budget Request Notes/Comments CITY LAND AND FACILITIES Goal: Maintain and improve all City-owned properties. 10. Ladera Linda Community Center and Park 10a Complete the CUP/CEQA planning entitlement processes.CDD Operating No -$ Will be done in-house. 10b Complete construction-ready documents for City Council consideration.PW 10c Complete bid process for construction firm and present contract to the City Council consideration.PW 10d Break ground on construction based on Council-approved plans.PW 11. Civic Center Master Plan 11a Present Civic Center development financing options to the City Council for consideration.FIN Operating Yes -$ Carry-over from existing contract. 11b Initiate discussions with DOJ and FEMA for a land-use swapping agreement as a part of the Civic Center Master Plan process.Admin Operating Yes -$ Included in the operating budget 11d Explore potential Civic Center partnerships that are compatible with the City Council approved program document, and coordinate appropriate usage with civic, business, and non-profit agencies to consider locating at the civic center Admin Operating Yes -$ Included in the operating budget 11e Present draft Civic Center Master Plan for City Council consideration which will include a new possible Peninsula-wide EOC, Sheriff substation, and fire station.Admin Operating Yes -$ Included in the operating budget 12. Trails Network Plan Update 12a Complete the Consultant's review of the draft update to the Trails Network Plan that provides user-friendly trail descriptions with graphics and detailed maps illustrating trail routes and uses in a clear and concise manner based on existing legal trails, community input, and feasible trails.R&P Operating Yes -$ The contract with Alta Planning was approved by City Council 1/15/2019 in the amount of $29,422 with a 10% contingency of $4,442 These funds are now in 101-400-5122-5101. The contract expires June 2021. In order to continue the work to an extended end date of June 2022, Alta Planning requests $5,250 to support additional project management costs associated with the extended timeline and an additional round of review an comment than originally scoped. 12b Conduct a public workshop to solicit community feedback on draft plan.R&P Operating Yes -$ Carry-over from existing contract. 12c Adopt the Updated Trails Network Plan R&P Operating Yes -$ Carry-over from existing contract. 13. Natural Communities Conservation Plan / Habitat Conservation Plan (NCCP/HCP) 13a Amend the Management Agreement with the PVPLC to reflect the City Council-adopted NCCP/HCP.R&P Operating No -$ Will be done in-house. 13b Create the NCCP/HCP-required Preserve Access Protocol to establish appropriate vehicular access to the Preserve including provisions for access during weather events (red flag days, tidal conditions, rain etc.)R&P Operating No -$ Will be done in-house. 13c Record the NCCP/HCP-approved conservation easements over all Preserve properties.R&P Operating Yes -$ Included in the operating budget 13d Update the Public Use Master Plan for the Palos Verdes Nature Preserve to reflect the Council-adopted NCCP/HCP.R&P Operating No -$ Will be done in-house. 13e Prepare a Preserve Master Parking Plan identifying parking opportunities to accommodate visitors to the Preserve that minimizes impacts on neighborhoods and resources.R&P Operating Yes -$ Included in the operating budget A-3 FY 2021-22 CITY COUNCIL GOALS BUDGET REQUESTS No.Goal Department Operating/ Capital?Budget? Budget Request Notes/Comments 14. Park Improvements 14a Explore establishing a partnership, joint use, and/or lease agreement with the U.S. Coast Guard for the Point Vicente Lighthouse property, buildings, and WW II Battery Barnes outpost owned by Coast Guard, Facility-commonly referred to as Coast Guard bunker (located at the Civic Center).R&P Operating No -$ Will be done in-house. QUALITY OF LIFE Goal: Maintain and improve the quality of life for RPV residents. 15. Western Avenue Redevelopment 15a Develop a SWOT analysis of commercial properties along Western Avenue to identify economic development opportunities to enhance retail establishments and create mixed-use projects. CDD Operating No 50,000$ This a max fee; scope of work will be phased. 15b Create a Traffic Flow Improvement Plan in coordination with Lomita, Los Angeles, and Caltrans to improve traffic flows and provide connectivity between retail outlets and residents. PW Capital Yes -$ CIP includes request for funding of $305,000 from City Prop C funds and $600,000 from approved Measure M grant funds in Fiscal 2021- 2022; $700,000 in approved Measure M grant funds in Fiscal 2022-2023, $1,100,000 of anticipated Measure M grant funds in Fiscal 2023-2024, and $1,570,000 of anticipated Measure M grant funds in Fiscal 2024-2025. 15c Develop a streetscape beautification plan to enhance the aesthetic character of Western Avenue.PW Capital Yes $ 400,000 For design; construction to be determined. CIP includes this project on needs/wants list with funding in a future year to be determined 16. Economic Development 16a Create a promotional economic development campaign to improve RPV's jobs/housing balance by supporting home-based businesses and encouraging business with high-quality jobs to locate in RPV.Admin Operating Yes -$ Included in the operating budget 17. Environmental Sustainability 17a Electric Vehicles: Adopt streamlined EV permitting policies in compliance with AB 1236 CDD Operating No -$ Will be done in-house; may have City Attorney costs. 17b Water Conservation: Develop and publish a Low Impact Development (LID) Standards Guidebook as resource to the development community to comply with the City's storm water ordinance and LID standards.CDD Operating No -$ Will be done in-house; may have some costs for JLHA support. 17c Develop program in collaboration with EDCO to recycle/divert organic waste from residential waste PW Operating No Will be done in-house. 18. Municipal Code Amendments 18a Update the City's Sign Ordinance (Section 17.76.050)CDD Operating No -$ Will have City Attorney costs. 18b Update the Wireless (private property) Facilities Ordinance (Section 17.76.020) CDD Operating No -$ Will have City Attorney costs. 18c Continue working with the Planning Commission Zoning Code Update Subcommittee on targeted code amendments to the Zoning Code Initiate remaining text amendments to complete the comprehensive update to Title 17 (Zoning Code) of RPVMC and Zoning Map. Target completion of 50% of updates by end of FY.CDD Operating No -$ Will have City Attorney costs. A-4 FY 2021-22 CITY COUNCIL GOALS BUDGET REQUESTS No.Goal Department Operating/ Capital?Budget? Budget Request Notes/Comments 19. Community Programs 19a Provide services for aging and disabled members of the community through the of a new Aging and Disability Resources Connection (ADRC) program Admin Operating Yes -$ Included in the operating budget 19b Launch a “Keep RPV Clean” campaign throughout the City’s open space areas R&P Operating No -$ Will be done in-house. CITIZEN INVOLVEMENT & PUBLIC OUTREACH Goal: Engage residents and community partners in assisting the City Council, City Committees/Commissions and City Staff facilitate the decision-making process. 20a Host Annual Leadership Academy for residents.Admin Operating Yes -$ Included in the operating budget 20b Host five City sponsored events or activities at the Civic Center throughout the fiscal year R&P Operating Yes 75,000$ $50,000 - $75,000 GOVERNMENT EFFICIENCY, TRANSPARENCY & ACCOUNTABILITY Goal: Maximize the use of each tax dollar and optimize services delivered to RPV residents. 21. Operations & Customer Service 21a Review View Restoration Ordinance and bring options to the Planning Commission and City Council to consider amending the guidelines.CDD Operating No -$ Will have City Attorney costs 21b Present Transient Occupancy Tax (TOT) rate options to FAC and City Council FIN Operating No -$ Will be done in-house. 21c Enhance internal and external customer service and efficiency so that all inquiries are acknowledged within the day received and that, when surveyed, internal customers indicate 95% satisfaction with responsiveness by colleagues, and external customers indicate 95% satisfaction with responsiveness by Staff.CDD Operating No -$ Will be done in-house. 21d Establish an efficient and streamlined development process between the Community Development and Public Works Departments to decrease the initial review time for applications to no more than 10 business days. Enhance the one-stop permit process.CDD Operating No -$ Will be done in-house; may need to tap into some IT operating budget. 21e Reassess the Study Session Admin Operating Yes -$ Included in the operating budget 21f 91% of RPV Employees say RPV is "a great place to work." Admin Operating Yes -$ Included in the operating budget 315,000$ Operating Budget Requests 755,000$ Capital Budget Requests 1,070,000$ TOTAL BUDGET REQUESTS A-5 2021-2022 Goals and Action Plan 0 100% - completed 6 56% - 99% - accelerated/near completion 10 26% - 55% - on target/on schedule 40 0% - 25% - behind schedule/at risk 0 N/A - not recommended/not necessary or New Goal 27 Priority Goals Number PROJECT / OBJECTIVE/OUTCOME/TASK RESPONSIBLE DEPARTMENT BUDGET ITEM TARGET DATE FOR COMPLETION REVISED DATE FOR COMPLETION ACTUAL DATE OF COMPLETION STATUS (%)COMMENTS/STATUS UPDATE 1. Law Enforcement 1a Reduce Part I Crime by 5% for FY 2021-22 compared to FY 2020-21 Admin 06/30/2022 0%New goal. 1b Expand Neighborhood Watch to five (5) new communities.Admin 06/30/2022 0% Staff has begun discussions with the City's Neighborhood Watch Coordinator to explore expanding the program to include multi-family and market specifically to communities not currently participating in the program. Revised goal that incorporates Goal No. 3 of FY2020/21 Goals by deleting multifamily NW participation and expanding the program to include more than multifamily. 1c Provide $30,000 in grants to residents and neighborhood groups for the acquisition of safety-enhancing tools and technologies Admin Yes 06/30/2022 0% New goal. Budget allocation is pending upcoming budget review. Safety enhancing tools and technologies may include ring doorbells and continuing the matching grant program for the flock safety cameras 2. Emergency Preparedness 2a Prepare a Landslide Emergency Sanitation Plan in coordination with LA County Sanitation District on how to respond to an emergency break in the above-ground sanitation line located on Palos Verdes Drive South within the Landslide Area. PW Yes 6/30/2021 20% The Sanitation District is working with a consultant to prepare an Emergency Sanitation Plan. City Staff has had preliminary discussions with the Sanitation District on elements to be included in the plan. This goal may be addressed with the completion of the utility white paper being prepared for the Peninsula Public Safety Committee. 2b Implement at least two of the EPC-recommended action items to mitigate wildfire risk in RPV, including: Enhanced Emergency Communication; Emergency Evacuation Plan/Peninsula-wide and school district emergency preparedness plan; Wildfire Hardening; Public Safety Power Shutoff response; and Cal Fire Risk Assessment and Insurance Rates Admin 6/30/2021 60% The Emergency Preparedness Committee has identified 21 actionable recommendations relevant to emergency response planning in Rancho Palos Verdes. On August 18, 2020, the City Council authorized sending a letter to residents expressing the City’s commitment to risk reduction, and measures residents can take to “harden” their home from a potential wildfire. On October 8 and October 12, the Emergency Services Coordinator and Committee Members met with the City of Malibu and the Topanga Coalition for Emergency Preparedness (T-CEP) for guidance on communication systems best practices and lessons learned. On November 18, 2020 the Emergency Services Coordinator presented Peninsula-wide wildfire mitigation preparedness efforts on behalf of the Peninsula Cities during a virtual Wildfire preparedness Town hall meeting hosted by Asm. Al Muratsuchi. On November 11, the Emergency Services Coordinator conducted a hybrid EOC Surprise Exercise for City staff. This exercise was conducted with no advanced notice to City Staff to assess our readiness in the event of a real emergency. City staff has drafted an After-Action Review report identifying lessons learned from this exercise. 3. Portuguese Bend Landslide 3a Complete the EIR for the Portuguese Bend Landslide Remediation Project for certification by the City Council PW Yes 12/31/2021 25% On May 19, 2020, the City Council approved a professional services agreement with the Chambers Group to prepare the environmental document. The Draft Initial Study was published for public review between November 12, 2020 and January 15, 2021. A public scoping meeting was held on December 19, 2020. The City's consultant has started work on the draft EIR. COLOR DESCRIPTION AND COUNTS PUBLIC SAFETY Goal: Maintain a high level of public safety with public engagement. INFRASTRUCTURE Goal: Maintain and improve all public infrastructure (including transportation systems, parking, utilities, storm drains, and sewers). Last updated: :03/16/2021 1 of 9B-1 2021-2022 Goals and Action Plan Number PROJECT / OBJECTIVE/OUTCOME/TASK RESPONSIBLE DEPARTMENT BUDGET ITEM TARGET DATE FOR COMPLETION REVISED DATE FOR COMPLETION ACTUAL DATE OF COMPLETION STATUS (%)COMMENTS/STATUS UPDATE 3b Prepare funding opportunities for Phases 1 & 2 of the Portuguese Bend Landslide Feasibility Plan for City Council consideration. FIN No ongoing 50% Staff is pursuing various potential funding opportunities for this project. The South Santa Monica Bay (SSMB) Watershed Area Steering Committee (WASC) met on May 19, 2020. WASC reviews all projects for Measure W funding. A Measure W application was submitted to the County for the Portuguese Bend Landslide Remediation Project in October 2020. Staff is also working with Blais and Associates to identify potential grants for this project, and City Staff is discussing potential funding opportunities with state and federal legislators. Staff anticipates to have some funding options for the City Council's consideration in summer 2021. Staff met with the FAC on Feb. 11 to propose continuing this goal to FY 2021-22 and the FAC supported staff recommendation. 3c Develop a mitigation plan to address land movement at Altamira Canyon based on the following phases: Phase One - Perform the drainage/erosion analysis for the entire canyon and its tributaries and establish a priority list based on current erosion. Phase Two - Prepare detailed engineering plans to resolve the erosion and making sure there is positive drainage along the canyon. Phase Three - Award construction contract for the proposed improvements. PW Yes Phase One: 6/30/2022 5% On November 4, 2020, the City Council approved a professional services agreement with Harris and Assoicates to perform the Phase One work. The procurement process is being completed and Notice to Proceed is expected to be issued in March 2021. 3d Develop a feasibility analysis with Rolling Hills for installation of an underground sanitary sewer system to replace the existing septic tanks to reduce ground water seepage within Portuguese Bend landslide. PW Yes 12/31/2021 50% Comments from Rolling Hills on the draft feasibility study were received on June 18, 2020 and provided to the consultant. The Draft Rolling Hills Sewer Concept Design (feasibility study) has been received and preliminary discussions with Rolling Hills were held. Review of the draft concept design has identified the need for further analysis of concept viability before finalizing the feasibility study for public review. 4. Asset Management 4a Create a detailed inventory and maintenance schedule of the City's public infrastructure and assets.PW Yes 6/30/2023 25% An inventory of assets is being mapped on the City's GIS. Funding for a condition assessment and development of a maintenance schedule will be requested through the CIP process. New goals and reordered tasks to accomplish this goal. Originally listed under Utilities in FY2020-21 Goals. 5. Small Wireless Facilities 5a Develop a Citywide 5G Small Wireless Facilities (SWF) Master Plan that identifies the preferred and least intrusive locations to install small wireless facilities including co-locations. PW Yes 12/31/2021 20% Phase One: hire a consultant and map preferred locations Staff issued an RFP in June and received two proposals from “Magellan Advisors” and “CTC Technology & Energy”. These proposals are being evaluated prior to bringing a professional services agreement to the City Council for consideration. Staff also has recently learned that the primary 5G SWF engineering and construction company on the Peninsula has developed a map showing preferred locations from an operability perspective. Staff intends to review this information and use it as a reference to establish least intrusive locations that are also sufficiently operable. New goals and reordered tasks to accomplish this goal. Originally listed under Utilities in the FY2020-21 Goals. 6. Electric Utilities 6a In coordination with SCE, develop a Utility Resilient Advancement Master Plan to harden above-ground utility lines including a tentative timeline to potentially underground utilities; and continue to lobby the California Public Utilities Commission to modify the requirements for Rule 20A undergrounding funds to include high fire risk areas. PW 6/30/2022 5% Public Works is in the process of setting a meeting with SCE to begin discussions on the Master Plan to safeguard the system through active maintenance and identifying needed improvements to the system. Southern California Edison's representative for this effort has been re-assigned; staff is working with the new representative to continue this initiative. New goal and reordered tasks that correlate in accomplishing the goal. Originally listed under Utilities in the FY2021-22 Goals and Action Plan. Combined Goal No. 81 from FY 2020-21 goals as it supports the effort of advancing undergrounding projects. 6b Identify alternative energy resources with the capability to store energy or sell it back to the grid system, which could power the City. The first phase is to identify potential alternative energy and the cost associated with this plan. PW 6/30/2022 5% At this time, City Staff is exploring how solar energy can be used to power City facilities and banked as a potential alternative energy source. New goals and reordered tasks that correlate in accomplishing the goal. Originally listed under Utilities in the FY2021-22 Goals and Action Plan. Last updated: :03/16/2021 2 of 9B-2 2021-2022 Goals and Action Plan Number PROJECT / OBJECTIVE/OUTCOME/TASK RESPONSIBLE DEPARTMENT BUDGET ITEM TARGET DATE FOR COMPLETION REVISED DATE FOR COMPLETION ACTUAL DATE OF COMPLETION STATUS (%)COMMENTS/STATUS UPDATE 6c Increase electric system reliability and safety in the City by reducing the average amount of power outages by 25% compared to FY 2020-21 by the end of FY 2021- 22 through the undergrounding of at least one mile of utility lines in open space areas. Admin Yes 06/30/2022 0% New goal recommended by the EPC. Budget allocation is pending upcoming budget review. 7. Sanitary Utilities 7a Develop a public sewer program to encourage on-site sanitary sewer systems to connect to the public sanitary sewer system based on the following phases: Phase 1: Map areas in the City that are served by a sanitary sewer system or on- site sanitary sewer system. Phase 2: Feasibility study of the areas which are not currently being served and prioritize the need for installation of the sewer system and identify costs to connect to the sewer system. Phase 3: Design the sewer system. Phase 4: Installation of the system. PW Yes 6/30/2021 80% Based on information available at City Hall and from LA County Environmental Health, Staff is working with the City's GIS Staff to finalize a map showing areas of the City served by onsite waste water sewer systems (Phase 1). 7b Prepare a new financial plan for the Abalone Cove annual sewer rates that reduces City maintenance subsidy by at least 50% for City Council consideration.FIN No 6/30/2022 50% Staff has estimated long-range costs for maintenance, operations, and capital costs of the system. The 18-year historical costs have provided a good baseline for future costs. Additionally, staff has identified capital improvements that will likely be needed in the next 5-10 years, due to the wear and tear on the pipes, grinder pumps, and lift stations. Staff is working with Abalone Cove residents to address the future Sewer Rates in order to reduce the City subsidy. On October 6, the City Council amended the Municipal Code with the current CPI-U and approved a connection fee. Staff is working with a consultant to perform an evaluation and assessment of the sewer system. This will provide staff with an updated annual maintenance cost estimate to properly prepare a financial plan. Staff will meet with the Portuguese Bend Community Association Board and conduct virtual neighborhood meetings to review the consultant's analysis before bringing this item to the City Council which Staff anticipates to have some options for the City Council's consideration in spring 2021. Staff met with the FAC on Feb. 11 to propose continuing this goal to FY 2021-22 and the FAC supported staff recommendation. 8. Roadways 8a Develop a Citywide Speed Mitigation Plan for reducing vehicular speed within City streets (traffic calming)PW Yes 6/30/2022 10% Staff have been working with Traffic Safety Committee to determine the scope of a Citywide Speed Mitigation Plan. The scope will be development of a masterplan that identifies speeding concerns on arterials throughout the city and develops specific mitigation measures to address those concerns; along with a robust public education and outreach component. Funding for development of the masterplan will be requested through the CIP process. 9. City Beautification 9a Develop an Arterial Fences and Walls Master Plan for the City Council's consideration that retains neighborhood identity and describes the type (material and height) of fence or wall, if any, to be placed along major arterial streets in the City. CDD Yes 6/30/2023 10% Staff continues to seek a consultant to assist with preparing a draft plan. Carryover to FY 2021-22 if funded in FY 2021-22 budget. 9b Create a City Entry Master Sign Plan at various points of entry to the City utilizing the following phases: Phase 1: Issue an RFP for the design. Phase 2: Design. Phase 3: Construction. PW Yes 06/30/2021 5% The City Staff is developing parameters for a City Entry Master Sign Plan to be incorporated in the scope of work for an RFP for the development of concepts of City Entry Signs. Concepts will be presented to Council for input. Funding for the design work will be requested through the CIP process. CITY LAND AND FACILITIES Goal: Maintain and Improve all City-owned properties. Last updated: :03/16/2021 3 of 9B-3 2021-2022 Goals and Action Plan Number PROJECT / OBJECTIVE/OUTCOME/TASK RESPONSIBLE DEPARTMENT BUDGET ITEM TARGET DATE FOR COMPLETION REVISED DATE FOR COMPLETION ACTUAL DATE OF COMPLETION STATUS (%)COMMENTS/STATUS UPDATE 10. Ladera Linda Community Center and Park 10a Complete the CUP/CEQA planning entitlement processes.CDD Yes 6/15/2021 75% Staff deemed the application complete for processing. At this time, it has been determined that the project is categorical exempt pursuant to CEQA. Public hearings on the planning entitlements (CUP, etc.) occurred on January 23, 2021 and February 23, 2021. Planning Commission approved entitlements on February 23. City Council voted to appeal the Planning Commission approval at its March 2 meeting. City Council appeal hearing to be held on April 6, 2021. 10b Complete construction-ready documents for City Council consideration.PW Yes 9/30/2021 60% Construction drawings have been suspended while the City processes the CUP/CEQA documents. 10c Complete bid process for construction firm and present contract to the City Council consideration.PW Yes 12/31/2021 0% Work will not commence on the bid process until planning entitlements are issued and construction plans completed based on Goal Nos. 25 and 27. 10d Break ground on construction based on Council-approved plans.PW Yes 12/31/2021 0%Referred to Goal No. 22 in 2019. construction will not commence until Goal Nos. 25, 26, 27, and 28 have been met. 11. Civic Center Master Plan 11a Present Civic Center development financing options to the City Council for consideration.FIN Yes 6/30/2022 50% In March, City Staff initiated discussions with Kosmont Transaction Services (KTS), but paused further discussions due to changes in the leadership team and to reassess the financial impacts of the economic downturn. Staff has developed a preliminary budget for this project that was confirmed as reasonable estimates by KTS. On October 15, Staff met with KTS to discuss funding options for the project. Staff has requested additional information and is working with Blais and Associates on identifying grant opportunities. Additionally, since September 2020, Staff has been meeting with consultants from various aspects of the development sector including project management consultants, developers, and other agency representatives to further understand, among other things, financing and product delivery options. Staff anticipates having some options for the City Council's consideration by early 2021. Staff met with the FAC on February 11, 2020 to propose continuing this goal to FY 2021-22 because there are still a substantial project decisions that still need to be made before the financial analysis can begin. The FAC supported staff recommendation. Reordered tasks that correlate in accomplishing the goal. 11b Initiate discussions with DOJ and FEMA for a land-use swapping agreement as a part of the Civic Center Master Plan process.Admin 12/31/2021 5% Communication with respective agencies established. Additional dialogue to continue in FY 2021-2220-21. Reordered tasks that correlate to accomplishing the goal. 11d Explore potential Civic Center partnerships that are compatible with the City Council approved program document, and coordinate appropriate usage with civic, business, and non-profit agencies to consider locating at the civic center Admin 03/30/2022 0% New Goal Last updated: :03/16/2021 4 of 9B-4 2021-2022 Goals and Action Plan Number PROJECT / OBJECTIVE/OUTCOME/TASK RESPONSIBLE DEPARTMENT BUDGET ITEM TARGET DATE FOR COMPLETION REVISED DATE FOR COMPLETION ACTUAL DATE OF COMPLETION STATUS (%)COMMENTS/STATUS UPDATE 11e Present draft Civic Center Master Plan for City Council consideration which will include a new possible Peninsula-wide EOC, Sheriff substation, and fire station.Admin 06/31/2022 30% Requires hiring a design firm to prepare a master plan and a robust public engagement process. Earlier this year, the Civic Center Advisory Committee (CCAC) prepared a draft Design & Architectural Services RFP. The City Council Subcommittee also reviewed the RFP. During this process, Staff realized that issuing an RFP to onboard a design firm, at this time, is premature until financing options is considered by the City Council. This is because the financing model the City Council finds most palatable will determine the development process including the master planning. Since September 2020, Staff has been meeting with consultants from various aspects of the development sector including project management consultants, developers, and other agency representatives to further understand, among other things, financing options, before issuing an RFP. At this time, Staff is considering issuing a Request for Interest (RFI) to glean more information on the development process for the Civic Center. City Council approved CCAC requests on Feb. 2 to proceed with a) an RFP for a project management consultant firm and b) facilitate a public workshop addressing municipal financial capital projects. A project manager will determine when to proceed with developing a master site plan. Staff has begun discussions with Captain Powers to obtain a written commitment that the LASD is interested in a substation at the Civic Center site. In 2018, L.A. County Sheriff Jim McDonnell sent letters indicating his support to place a facility at the Civic Center site. On December 9, 2020, Captain James Powers of the Lomita Sheriff Station provided verbal support of the project but cautioned that staff must receive support from Sheriff Villanueva before proceeding. A site tour was scheduled for January 2021 but was postponed for Spring 2021 due to current health orders. Reordered tasks that correlate in accomplishing the goal and combined Public Safety No. 2 in the FY2021-22 Goals and Action Plan. Getting EOC, Sheriff station and fire station are goals, and written commitments are tasks. 12. Trails Network Plan Update 12a Complete the Consultant's review of the draft update to the Trails Network Plan that provides user-friendly trail descriptions with graphics and detailed maps illustrating trail routes and uses in a clear and concise manner based on existing legal trails, community input, and feasible trails. R&P Yes 7/31/2021 50% Referred to Goal No. 26 in 2019. Transferred to R&P in May and Staff regrouped with consultant, Alta Planning and Design, to complete the draft Trails Network Plan. A status update was provided to the City Council at its June 16 and September 15 meetings. City working group and IMAC Trails Subcommittee coordinating on content of document, and updating process. The consultant continues to update the administrative document which is now anticipated to be completed by May 2021 because Staff commitments have shifted to Preserve-related parking strategies. 12b Conduct a public workshop to solicit community feedback on draft plan.R&P 8/31/2021 10% Based on City Council direction on June 16, there will be one additional public outreach meeting led by Staff to solicit community feedback on draft plan. Over the next several months, Staff, with the assistance of the Alta Planning and Design consultant will prepare and disseminate information to maximize public awareness and involvement. Staff continues to work with its consultant on the format and presentations for the upcoming workshops. 12c Adopt the Updated Trails Network Plan R&P 12/31/2021 0% Staff and the consultant will update the draft TNP to include Planning Commission input prior to presenting to City Council. Dates that the TNP will be presented to City Council will be finalized, but is anticipated to occur December 2021, and the document will be released three weeks prior to meeting. 13. Natural Communities Conservation Plan / Habitat Conservation Plan (NCCP/HCP) 13a Amend the Management Agreement with the PVPLC to reflect the City Council- adopted NCCP/HCP.R&P 12/31/2021 5% Over the next several months, Staff will coordinate with the City Attorney's Office and the PVPLC to continue identifying potential amendments for the City Council's consideration in December 2021. Last updated: :03/16/2021 5 of 9B-5 2021-2022 Goals and Action Plan Number PROJECT / OBJECTIVE/OUTCOME/TASK RESPONSIBLE DEPARTMENT BUDGET ITEM TARGET DATE FOR COMPLETION REVISED DATE FOR COMPLETION ACTUAL DATE OF COMPLETION STATUS (%)COMMENTS/STATUS UPDATE 13b Create the NCCP/HCP-required Preserve Access Protocol to establish appropriate vehicular access to the Preserve including provisions for access during weather events (red flag days, tidal conditions, rain etc.) R&P 12/31/2021 40% These protocols are required to be completed within a designated period of time after the City receives the NCCP/HCP permits from the state and federal wildlife agencies. The City has received its federal permit, and is awaiting the state's permit decision. Staff is currently working with the Wildlife Agencies to proceed with these documents. Park Rangers are educating authorized agencies about appropriate vehicular access and installing signage. 13c Record the NCCP/HCP-approved conservation easements over all Preserve properties.R&P 11/30/2021 30% Staff has met with a surveyor and is working with the City Attorney to finalize the contract for City Council approval in August, 2020. The conservations easements are required to be recorded within a designated period of time after the City receives the NCCP/HCP permits from the state and federal wildlife agencies. The City has received its federal permit, and is awaiting the state's permit decision. Approval of contact with surveyor expected by December 2020. Completion date is April 30, 2021. The City Council approved a contract with McGee Consulting on January 19, 2021 to create the required property descriptions to place conservation easements over Preserve properties. Working meetings and site visits are taking place. 13d Update the Public Use Master Plan for the Palos Verdes Nature Preserve to reflect the Council-adopted NCCP/HCP.R&P 3/31/2022 10% Staff is making advance preparations for updating the Public Use Master Plan, including referencing appropriate sections of the NCCP/HCP and updating trail maps. 13e Prepare a Preserve Master Parking Plan identifying parking opportunities to accommodate visitors to the Preserve that minimizes impacts on neighborhoods and resources. R&P 12/31/2021 70% On March 17, 2020, the City Council received a report on parking improvements at Del Cerro trailhead. Staff continues to research options and explore alternatives to minimize impacts on neighborhood parking and residents' quality of life both short-term and long- term. On August 18, 2020 and September 1, 2020 meetings the City Council directed Staff to continue social medial campaign to inform and educate public and direct visitors to alternative locations including Alta Vicente. SEO contract with Tripepi Smith approved. Modified a two-month temporary parking moratorium along Crenshaw south of Crest. Public informed via listserve, website, and social media. Burma and Rattlesnake trailhead gate contracts approved. Staff directed to research alternatives for parking enforcement and pay system options. Staff directed to look at holistic approach to Preserve parking. A Preserve public forum was held on October 13, 2020. A City Council meeting was held on October 20, 2020. The City Council provided direction on a number of issues including holistic Preserve parking analysis, parking enforcement and a parking reservation system, a 60-day extension of parking moratorium on a section of Crenshaw, a citation/fee analysis, Preserve capacity study, and Alta Vicente trailhead beautification. Holistic planning continued at meetings on January 19 and February 16, 2021. As a result, the following elements of a holistic approach to Preserve Parking and Access are underway: • Preserve capacity analysis • Web and social media campaign • Traffic and parking analysis • Parking solutions specific to Crenshaw Boulevard and Park Place • Increasing parking enforcement • Establishing reservation and fee-based parking system • Increasing parking citation fines • Installing access gates at Burma Road and Rattlesnake trailheads • Dispersing public use to alternative reserve locations • Beautifying Alta Vicente Reserve/Civic Center • Establishing a Preserve Pilot Shuttle program 14. Park Improvements 14a Explore establishing a partnership, joint use, and/or lease agreement with the U.S. Coast Guard for the Point Vicente Lighthouse property, buildings, and WW II Battery Barnes outpost owned by Coast Guard, Facility-commonly referred to as Coast Guard bunker (located at the Civic Center). R&P 12/31/2021 40% Staff has reached out to the Coast Guard to initiate dialogue about the future use of these properties. Staff and several City Council members took tours of Coast Guard properties with USCG personnel in October 2020 and held informal discussions of potential acquisition and partnership. The USCG expressed a strong interest in developing a partnership with the City. Additional meetings are being planned to begin brainstorming partnership arrangements. Last updated: :03/16/2021 6 of 9B-6 2021-2022 Goals and Action Plan Number PROJECT / OBJECTIVE/OUTCOME/TASK RESPONSIBLE DEPARTMENT BUDGET ITEM TARGET DATE FOR COMPLETION REVISED DATE FOR COMPLETION ACTUAL DATE OF COMPLETION STATUS (%)COMMENTS/STATUS UPDATE 15. Western Avenue Redevelopment 15a Develop a SWOT analysis of commercial properties along Western Avenue to identify economic development opportunities to enhance retail establishments and create mixed-use projects. CDD Yes 6/30/2021 10% The City prepared a potential redevelopment site analysis and has met with four potential developers to explore mixed use projects. In May, the City was awarded a $160k from the SB 2 grant fund to develop a mixed use plan for Western Avenue. Additionally, the City applied for the Local Early Action Planning (LEAP) grant to seek an additional $150k to support mixed use planning efforts that will enhance economic development opportunities in the City. Reworded the goal to be more SMART. 15b Create a Traffic Flow Improvement Plan in coordination with Lomita, Los Angeles, and Caltrans to improve traffic flows and provide connectivity between retail outlets and residents. PW Yes Phase One: 12/31/2022 25% Metro Board approved $1.33 million for Western Avenue Congestion Improvement Project to be used for a Project Study Report (PSR). Staff is further refining the scope of work and coordinating with the California Department of Transportation; who owns Western Avenue and has approval rights over any work in the corridor. The timeline of this project is subject to the CalTrans coordination and review times. review and approval timelines. 15c Develop a streetscape beautification plan to enhance the aesthetic character of Western Avenue.PW Yes 6/30/2023 5% The CIP for FY 2020-21 includes $150,000 for the design of the Western Avenue Beautification Project. Staff received proposals in response to an RFP for the design of the beautification of Western Ave and selected a qualified firm. Fee negotiations are ongoing and a professional services agreement will be brought to Council for award when negotiations conclude in the next month. Funding for final design will be requested through the CIP process. 16. Housing Economic Development 16a Create a promotional economic development campaign to improve RPV's jobs/housing balance by supporting home-based businesses and encouraging business with high-quality jobs to locate in RPV. Admin 6/30/2022 5% City Staff is in the early stages of developing a branding campaign for Western Avenue that will incorporate Goal No. 47 of FY 2020-21. The branding campaign will bring together the traffic flow, beautification, and economic development projects for Western Avenue. Staff is collecting information on potential marketing consultants. 17. Environmental Sustainability 17a Electric Vehicles: Adopt streamlined EV permitting policies in compliance with AB 1236 CDD 6/30/2022 0% New goal. Goal 17a was developed based emissions reduction, pursuant to ERAP Measures Land Use and Transportation (LUT) Measure A: Accelerate the Market for EV Vehicles. Goal 17a we added to address LUT Measure A1 (EV Parking Policies), LUT Measure A2 (EV Charing Policies) and LUT Measure A3 (Administrative Readiness). 17b Water Conservation: Develop and publish a Low Impact Development (LID) Standards Guidebook as resource to the development community to comply with the City's storm water ordinance and LID standards. CDD 06/30/2022 0% New goal. 17c Develop program in collaboration with EDCO to recycle/divert organic waste from residential waste PW 06/30/2022 0% New Goal. This goal will support Measure Solid Waste A2. Diversion/recycling of organic waste reducse green house gas emissions by reducing methane gas produced when organic waste decomposes in landfills. 18. Municipal Code Amendments 18a Update the City's Sign Ordinance (Section 17.76.050)CDD 9/30/2021 25% Staff is working with the City Attorney's Office on the preparation of a draft code amendment for review by the Planning Commission. Draft regulations in development stage. Planning Commission likely to consider in January 2021. Staff is working with the City Attorney's Office on the preparation of a draft code amendment for review. Planning Commission to begin consideration of new code standards in February. On February 9, 2021, Planning Commission directed the Zoning Subcommittee to work with staff and the City Attorney's office on the development of an updated sign code. QUALITY OF LIFE Goal: Maintain and improve the quality of life for RPV residents. Last updated: :03/16/2021 7 of 9B-7 2021-2022 Goals and Action Plan Number PROJECT / OBJECTIVE/OUTCOME/TASK RESPONSIBLE DEPARTMENT BUDGET ITEM TARGET DATE FOR COMPLETION REVISED DATE FOR COMPLETION ACTUAL DATE OF COMPLETION STATUS (%)COMMENTS/STATUS UPDATE 18b Update the Wireless (private property) Facilities Ordinance (Section 17.76.020) CDD 10/31/2021 10% Staff will begin updating the wireless facilities section of the code in early 2021. Staff is working with the City Attorney’s Office on the preparation of draft language for review. The Planning Commission likely to consider before Summer 2021. This goal is recommended to be continued to FY2021-22. 18c Continue working with the Planning Commission Zoning Code Update Subcommittee on targeted code amendments to the Zoning Code Initiate remaining text amendments to complete the comprehensive update to Title 17 (Zoning Code) of RPVMC and Zoning Map. Target completion of 50% of updates by end of FY. CDD 06/30/2022 0% New goal. 19. Community Programs 19a Provide services for aging and disabled members of the community through the of a new Aging and Disability Resources Connection (ADRC) program Admin Yes 12/30/2021 0% Staff is developing the ADRC to provide resources and programs for aging and disabled members of the community, establishing a volunteer network to assist with the programs including reinstating the Handyman Program, and creating a Special Needs Registry to have information for community members in the event of an emergency. New Goal and subsection to Quality of Life. New subcategory and goal. Budget may be required for Handyman and Special Needs Registry program. 19b Launch a “Keep RPV Clean” campaign throughout the City’s open space areas R&P 12/31/2021 0% New goal. Work with community partners by launching a community clean up program which includes a social media campaign, monthly volunteer events, and developing and distributing information and incentive packets for families and/or neighborhoods to keep City Parks, Preserve, Beaches and streets clean of litter. 20a Host Annual Leadership Academy for residents.Admin 06/30/2021 0% Referred to Goal #35 in 2019. Staff recommends deferring this until 2021. Staff is finalizing a new version of the Bi-Annual Leadership Academy. Applications will open in Spring and will be conducted virtually. 20b Host five City sponsored events or activities at the Civic Center throughout the fiscal year R&P Yes 06/30/2022 0% 21. Operations & Customer Service 21a Review View Restoration Ordinance and bring options to the Planning Commission and City Council to consider amending the guidelines.CDD 12/30/2021 5% Staff is reviewing the existing ordinance and guidelines to determine the scope of the proposed amendments. Staff is reviewing the existing ordinance and guidelines to determine the scope of the proposed amendments. Planning Commission likely to consider Summer 2021. 22b Present Transient Occupancy Tax (TOT) rate options to FAC and City Council FIN No 6/30/2022 50% Staff presented the TOT trends and analysis to FAC on Sept. 26, 2019. Due to the economic downturn and the recent impact on the travel/hospitality industry, staff will resume discussion with FAC in January/February of 2021. Staff met with the FAC on Feb. 11 to propose continuing this goal to FY 2021-22 due to the uncertainty in the travel and hospitality industry. CITIZEN INVOLVEMENT & PUBLIC OUTREACH Goal: Engage residents and community partners in assisting the City Council, City Committees/Commissions and City Staff facilitate the decision-making process. GOVERNMENT EFFICIENCY, TRANSPARENCY & ACCOUNTABILITY Goal: Maximize the use of each tax dollar and optimize services delivered to RPV residents. Last updated: :03/16/2021 8 of 9B-8 2021-2022 Goals and Action Plan Number PROJECT / OBJECTIVE/OUTCOME/TASK RESPONSIBLE DEPARTMENT BUDGET ITEM TARGET DATE FOR COMPLETION REVISED DATE FOR COMPLETION ACTUAL DATE OF COMPLETION STATUS (%)COMMENTS/STATUS UPDATE 23c Enhance internal and external customer service and efficiency so that all inquiries are acknowledged within the day received and that, when surveyed, internal customers indicate 95% satisfaction with responsiveness by colleagues, and external customers indicate 95% satisfaction with responsiveness by Staff. CDD 10/31/2021 25% Work will commence in fall Progress is limited based on staffing levels. Carry over goal. Staff anticipates preparing memorandum regarding findings before Fall 2021. An employee (internal customer service) survey was issued on September 30, 2020 with a deadline date of October 14. Staff tallied the results and generally speaking employees are somewhat satisfied. Department Heads are assessing the results of the employee results to identify areas to improve employee satisfaction. A follow-up survey will be issued in Fall 2021 to compare results after enhanced measures are implemented. In addition to the resident survey presented to the Council on February 16, 2021, Staff is preparing a specific customer service survey. It should be noted that in the resident survey 71.8% of respondents indicated that they were somewhat or very satisfied. 24d Establish an efficient and streamlined development process between the Community Development and Public Works Departments by working together to prepare a comprehensive Uniform Development Process public handout and to decrease the initial review time for applications to no more than 10 business days. Enhance the one-stop permit process. CDD 12/31/2021 20% New goal. 25e Reassess the Study Session Admin 12/31/2021 0%Activity on this goal is pending further review of the City's study session policy. 26f 91% of RPV Employees say RPV is "a great place to work." Admin 11/30/2021 75% Referred to Goal #48 in 2019. Survey was sent on September 30, 2020 with a deadline date of October 14. Staff is tallying the results. Human Resources tallied the results and determined 79% of RPV employees would say "it is a great place to work." Department Heads are assessing the results of the employee results to identify areas to improve employee satisfaction. Last updated: :03/16/2021 9 of 9B-9