City Council Meeting November 17, 2008

0:02:04thank you all for coming tonight I'd like to call the meeting of November 17th 2008 city council meeting to order I'd like to ask uh the mayor protim to lead us in the pledge please join me to the flag of the United States of America and to the Republic for which it

0:02:28stands under God indivisible with liberty and justice for all thank you uh let the record reflect that all members of the city council are present tonight do we have any uh staff Communications Council um yes I just have uh one uh communication um and I'm doing this

0:02:55pursuant to AB uh 1234 I attended did the climate Allstars conference uh one day Conference held in San Francisco um this month and um we received an honorable Miss um mention for an award for the work that we had done to implement um what we had said that we would do a year ago when we went

0:03:20um or when I went anyway and um so um we have that award and um uh G that award actually and he's when he gets it ready he's going to be forwarding it to a place where we'll be able to see it um and um I thought what I would uh mention uh for this report is what I

0:03:43thought was the most important takeaway that I got from the conference and uh that was um what one could do that would really make a difference um in um climate protection and we at one of the sessions that I went to we talked about the value of doing the what you might call the little

0:04:05things that would be things like uh changing a light wind light bulb out or um you know things like that and what this discussion was about is even if you do a lot of those little things um they're really not going to do the what we need to be done so what we're really

0:04:22going to have to do in order to really make an impact um on uh the climate is to reduce our consumption so you know all those little things put together are just not enough and um that was the first time I'd ever actually been anywhere and heard that Express that way so um that was the uh

0:04:44the biggest takeaway that I got from that conference which was a really good one and uh we had a number of speakers including um the author of assembly Bill 32 uh whose name is uh Fran pavley and she is an outgoing assembly member who will be moving over to the Senate side

0:05:06um and um that's and then I also received and I think I haven't brought this before the aani principles for climate change and I thought I would give it to the city clerk to uh distribute copies of to our packet thank you that's my that's my report thank you you or Sandy you have any I just had a a

0:05:33couple quick things uh next meeting will be uh the induction of our new city council members that's assuming that the um the county certifies the vote as scheduled and we will be meeting on Tuesday December 2nd rather than Monday December 1st and primarily because of

0:05:53that to try to ensure that um we do have a certification by our by our first meeting in December member and that was set by Council uh what a month or so ago so we will be meeting dece uh Tuesday December 2nd that meeting we will also be uh uh honoring the latest Wall of Fame uh

0:06:15member and so uh it'll be quite an evening for uh celebration sounds like anyway thank you very much I ask the city count uh city clerk to introduce the next agenda item please next item me next item on the agenda is oral Communications from the public this place on the agenda is reserved for

0:06:37comments and inquiries from the public regarding matters on the agenda and matters which do not otherwise appear on the agenda all persons wishing to speak should sign up with the city clerk remarks are limited to 3 minutes per person please state your name and city

0:06:50of residence for the record comments regarding consent calendar items will be heard first please take notice of our new speaker timing system located at the top of the presentation table up here a green light is activated when you start speaking a yellow light will appear when

0:07:06you have 1 minute left and when you see the red light you will know that your time has concluded with that we have three three speakers the first is Al [Applause] Miller good evening El Miller [address removed] here in El I just wanted to take a few minutes to tell you of the very uh interesting and

0:07:35rewarding Saturday morning I spent as a backer Creek Steward down in our Gateway Park uh I'm embarrassed that I don't remember the young woman's last name but uh you can't forget her first name ocean uh was there uh supervising it and instructing it uh my son and

0:07:54daughter-in-law and three grandchildren and one of their friends uh all went down there and there was one other woman there working also uh but ocean spent the first hour hour and a half very patiently walking us up and down uh the pathway explaining the different uh

0:08:12flora and fauna and the different stages in the recovery of the the creek site explaining what it was as a railroad area yard before uh why some of the areas haven't started coming back yet but they are coming back and it was Revelation to me I thought I knew something about the area but not only

0:08:34the facts that she put out but her ability to hold the attention of these four uh kids from 8 to 12 while we were doing that uh after that we took a short water break and then she put us to work removing the non-native plants or invasive plants and uh the thing that I will remember is

0:08:57that she actually wore out three of the four the only one that she didn't wear out was a 12-year-old she wore me out before any of them but anyway there'll be another one December 13th uh which she has planned to do much the same and I highly recommend and urge

0:09:16anyone with or without grandchildren's or Sons or daughters uh to go out and take part it's a very enjoyable and rewarding experience especially when we have such a nice day like we did thank you and thank ocean excuse me what time do you know uh 9:30 it starts 12:30 it

0:09:33ends scheduled thanks next speaker please Peter Lal um good evening I'm Peter lobal first of all I'm glad to see our two council members Electa here and and Greg and maybe if they notice in Washington they let Barack Obama attend governmental meetings too it would be

0:09:57helpful and and uh I know Greg was here I think two meetings ago when um John Joya supervisor Joya praised ELO for being so Democratic as Democratic as letting me speak for 3 minutes that proves you know we have differences of opinion well uh I'd like to let the two new members know that

0:10:23Evolution gave us two ears and one mouth so that we could listen and I feel that this Council hasn't listened they just tolerated 3 minutes of criticism and I suggest that you learn to listen uh what I really came to talk about is that four weeks ago uh you had three citizens address

0:10:44you on the issues of Street of uh closure of schools I think this is a major issue yes it does concern the Unified School District but it is a major issue in elero there's nothing more important in elero than schools uh we we know that uh we're losing we're losing uh pupils and losing money and

0:11:07therefore that threatens with school closure there's a contradiction there because I'm sure some of the parents are happier with the with the smaller schools and uh I find it very ironic that this is happening at a time where we just opened up a new city hall uh we

0:11:23have to pay off a bond of believe believe eight maybe 10 million $10 million and that cost as much as maintaining those schools would have so uh personally I would have been happier to uh to see the kids stay in their schools in the elementary schools unclosed and uh uh I and have the

0:11:43managers and I think all all government should be in temporary buildings they probably do a better job uh so though it's beautiful here I think you did not do uh do right by the citizens of elero by not getting involved in schools thank you very much thank you next speaker

0:12:03please no other speakers at this time okay thank you next agenda item please the next agenda item is presentations Doctor's Medical Center update presentation by Joe Stewart chief executive officer Doctor's Medical Center welcome thank you very much it's good to be with you you all tonight

0:12:30maybe tell you some good stories um I'm Joe Stewart the CEO of uh Doctor's Medical Center I've actually been there for the past uh year and three months I came in as part of the national Consulting Group to uh put the hospital back together again and uh after that I was asked to

0:12:54consider staying on as um uh hesitate to use the word permanent CEO uh but as a CEO and I decided to do that and started on October 1st so I am here uh moved into the county and um continuing the work that we've been able to accomplish at the the hospital as you might first

0:13:16of all be aware that uh we went through the terrible trauma of financial difficulties which is certainly not unknown to government social agencies uh anybody in this day and age who is trying to make do with limited resources of the people's money uh realizes that this is a a big

0:13:35Challenge and so for this Hospital which is uh the largest provider of healthc care in West Contra Casta as the uh second largest uh provider of Emergency Services in the entire County uh this was a very strong wakeup call that we need to pay attention to this because

0:13:55there would have been a great hole in the provision of care to a large part of uh the West Contra Casta population uh I'm pleased to tell you if you uh had not been tracking it that as of uh August we completely came out of bankruptcy and uh provided both the court and the creditors with a

0:14:15three-year plan that uh provided uh acceptance by them to bring us out of bankruptcy and that of course brought us to really the most important thing that we were supposed to be doing and that was paying attention to the care of our fellow citizens I must tell you that bankruptcy which I had never uh

0:14:34experienced before in a hospital in my career is a terrible nightmare uh it uh diffuses the focus in a very important uh Community organization and you begin to talk to people in the courts in the judicial system judicial system as opposed to the people of the community saying how do we

0:14:54care for you I realize it's a necessary step an important one but it is it truly absorbs resources uh that would be better spent in taking care of the business of the people I'm happy to say though that uh subsequent to August that we have recovered that focus and have paid a particular

0:15:14attention to reestablishing our credibility and our care uh with the citizens and we've done that um in a lot of different ways um part of our success has been to reduce a debt uh of almost $30 million negative we brought that down to 1,900,000 negative last year and we'll

0:15:36present to the um the uh Board of Trustees the Tuesday before Thanksgiving our budget for 2009 which will be positive by some $4 million so that's a really important turnaround for uh those of us uh who are very concerned that that hospital remains stable um what as you know that

0:15:58for-profit institutions always turn that money back into the institution to help it grow and we've already begun that reestablishing of the hospitals uh core services and core equipment uh We've completely uh reestablished all the equipment in the laboratory uh the basic

0:16:16uh diagnostic tool of any hospital is uh and most important tool is its laboratory services because there you get the clues and the and the uh details of what is going wrong with that particular patient and you might suspect in this day and age a lot of that new

0:16:31equipment is um computerized and comes in real time and it gets connected to our computer so that information gets out to the Physicians and the nurses within um uh very short time after those tests are taken that was all completely redone uh we also began to take care of

0:16:50uh uh some of the basic structures of the hospital that while they're not glamorous really had to be taken care of we replaced and put an entire new uh fire detection and alarm system in the hospital um we're in the process of replacing the uh Transformer by which

0:17:06all the power from pg& comes into the hospital and has to be transformed for our uses uh that was in danger of uh not succeeding in the near-term future and uh we also have um put a number of improvements in all areas of uh patient care um and we'll continue to do that uh

0:17:28We've our budget for this year and Capital Equipment was $6.9 Million returned into the hospital for the renewal of equipment we've turned our attention to basic care and in particular we are looking to improve and to be outstanding and two areas of care very important to

0:17:47Americans most of us get sick and um most of us die from heart disease and cancer and most of us do that in our community hospitals so it's really important for our Community Hospitals to really pay attention to those particular areas that most of us uh suffer from and

0:18:05also to realize that uh technology has migrated uh to these Community Hospitals where care that was once only available in University uh hospitals tertiary institutions is now available um in the community hospital why is that important first of all it's important because we

0:18:23know now that the sooner that uh we get to care in the areas of cancer and heart disease we actually can save lives uh reduce the um damage being done by those diseases and particularly in the areas like cancer the biggest cure for cancer is really early detection the sooner we

0:18:43know that cancer is there the sooner that we can get to it and uh Our intention is to excel in both of those I'm pleased to tell you that our Cancer Center uh recently went through our national accreditation program which is conducted by the American College of

0:18:59Surgeons and the cancer program was given um it's full accommodation and rece uh accreditation and receive seven commendations in terms of great care there are only 52 institutions in the united cancer centers in the United States of America that have that designation we're really proud that we

0:19:17can provide that level of service to uh the people of West Contra Casta uh we are going to make a major investment and expand those services in the next year or two uh as we speak we are uh preparing for presentation to uh the city of San Pablo our building plans to

0:19:36extend the cancer center and put in a brand new linear accelerator this piece this uh piece of uh medical equipment provides all the radiation oncology for cancer victims two main ways we deal with can three main ways one is surgical one is medical with drugs and the third

0:19:53is radiation uh we will provide uh a uh almost $8 million reinvestment into the cancer center by the time we're done which will be approximately about another year and a half we also are putting a major we put a major commitment into the treatment of heart disease in um in Contra Casta

0:20:13County we have been designated as one of What's called the stemi center uh a stemi center is a series of initials that mean uh refer to the fact that we are a center that is a destination Center to go when you've believe that you have got something going on with

0:20:29your heart and that Center is equipped to provide you with an incredibly fast service and detection and ability to get you to the proper level of treatment in under 1 hour that is a very important step for the treatment of heart disease because what's going on when someone's

0:20:47having a heart attack the heart is literally beginning to die and the sooner that you can intervene with that you stop that death uh we've already um begun to see some very remarkable results were people coming in saying and usually uh men will typically say I think I have indigestion or some kind of

0:21:06a really bad stomach ache and they'll come in and uh other people will just say have this tremendous discomfort uh these are always signs that are taken very seriously and we are able to get those uh people to the proper care as they said into an into an an hour this

0:21:23is in coordination with the county we work very closely with um Emergency Medical Services uh the entire Hospital comes into play to make that happen um we're also going to introduce a whole new track in the emergency room as you know uh the emergency rooms in the United States of America have become

0:21:44for all practical purposes the National Health uh safety net the national health insurance program all emergency rooms are required under federal law that any human being that puts their foot into them must be taken care of with without regard to cost we now have almost 44

0:22:01million people in the United States who have no care no place to go and those people are going to emergency rooms to seek their care uh before we begin to think of who that stereotype of person might be uh the greatest number of these people are our young people our sons and

0:22:17daughters who are perhaps married with their first child and who have very strain resources and uh have to put food on the table and pay the rent and really don't have enough money left over for health insurance these young people are showing up um into these emergency rooms

0:22:33because they simply have no place else to go um the emergency rooms therefore are filled 44,000 people is like a little city that we see and uh one of the problems in emergency rooms is typically when you talk to people is the weight I have t it take me so long to go

0:22:52through that emergency room uh we have uh begun and we have uh tested this uh in October and we'll put it into full swing here as we go into December a rapid medical evaluation in our emergency room so that uh when you come into the emergency room you're going to

0:23:11be if there is uh a determination there's a true emergency a stroke a heart attack serious trauma accident uh you obviously are going to be treated in the emergency situation and we'll get U obviously all the treatment that's required if the assessment is that this

0:23:27is something that could be handled in a more expeditious manner a high fever of a child a a chronic uh uh cold that just simply doesn't go away other kinds of distress we will put you through our rapid uh treatment so that uh our goal is that you will have no longer uh more

0:23:46than a an hour or hour and a half weit be the time you come in to the time you go out uh that's going to be a very important addition uh not only to the emergency room but because of what I said to you A lot of times today people are using that emergency room as their

0:24:01primary care physician uh when they have no access or they can't get in to see that physician um we're in the process now of recruiting our um to replace the Consulting team that has come in to help the hospital to have a whole new um executive team and there in terms of our

0:24:21nursing structure in terms of our operations and our finances and that will be in place in a by the end of this month we'll have that in there um also to you may or may not be aware that the county is considering replacing the Richmond County clinic that uh now sits

0:24:39down in the iron triangle area uh it seems that Lowe's uh Home Improvement seems to want uh that particular particular piece of property and it seems as if this is a good time to replace the County clinic the Richmond County clinic at this particular point the county has come before for the uh

0:24:58District Board of the of Contra West contracosta Healthcare District board to ask their consideration of placing that clinic on the campus of the medical center um which would be on as you face the hospital on the West Side the right hand side in that particular Corner um

0:25:16this um will take approximately almost a year in planning if the West Contra Casta healthcare district board uh decides to use its land in that particular fashion um there is a feeling that there could be a real good Synergy there they for example not having to build Laboratories or

0:25:34Radiology equipment and using that of the hospital you can have uh significant savings there and also to um by having a greater coordination between the emergency room and the clinic you may be able to provide more of a steady level of care to patients that normally don't

0:25:52have a primary care physician obviously have to go through all sorts of planning and eval evaluations and so on uh involves you can imagine an awful lot of um thinking through of sewers Roads Traffic uh we have a helicopter pad there as well uh they estimate this if

0:26:11it gets uh approval at the district level it will probably take a good 12 to 18 months of just planning alone uh as I understand it this is a $60 million investment uh so it's a very major investment uh for healthc care in in the county and um for needed one in West

0:26:29Contra Casta County as you know a lot of residents here on the West side of rude 80 complain how difficult it is to get to the East side and particularly to the county facilities in Martinez so it becomes extraordinarily important that they have access to care uh with um that

0:26:46is able to be reached in a reasonable amount of time even with public transportation which is not the case on the um east side of the county um those are some of the major highlights I don't know if you have any questions of me or things that you want me to address are there any services

0:27:03that doctors provided before the Hiatus that haven't yet been brought online in the new facility or new um as you know before the uh be before the bankruptcy there was a complete uh OBGYN service there and the obstetric part of that uh was uh closed uh before the bankruptcy

0:27:26and then coordinated with uh basically a lot of that care went to um alates um there is still strong interest within the community for obstetrical services we still are able to handle and do handle those in an emergency situation in the emergency uh room as well as gynecological Services the

0:27:45gynecological services remain but the obstetrical services uh were um the second floor of the hospital was closed to those Services um I I can't tell you that they will come back but uh most Community Hospitals and most communities have a strong desire to have an

0:28:02obstetrical service they want to have uh women want to have be able to have children close to home not have to travel get into traffic and things like that can't tell you that is ruled out uh but in the in this three-year period by which we um pay off the bankruptcy it

0:28:19probably would not appear would be first considered after that is concluded anything else um now all the other services uh were there um and um we've actually have increased services in our um as as I told you in cardiology and cancer um can't think can you think of it was

0:28:44there a burn center uh the burn center had been uh closed sometime before that uh the need for the bird center decrease uh as the industrial sites particularly the refineries uh really took uh safety much more seriously within their own uh facilities and proactively uh manage those uh the need

0:29:08for the uh Burn Center in terms of the the volume that we receiving uh declined and almost disappeared uh so that burn center has been gone for some time burn centers are extraordinarily expensive and they need to be very regionalized to to get people to them thank

0:29:29you any question Sandy I just have one what is your long-term uh plans and and outlook for financing since you were near bankruptcy so that financing was a huge uh concern uh going forward what's it look like right now I think it looks good because in order to get out of bankruptcy we

0:29:53really did uh some really radical restructuring and radical exam mination and correction first of all of our basic Financial structure our whole finance department billing um there were um there were a number of areas by which as the Consulting Group we were able to

0:30:11bring in almost uh 5 six million per year of additional money that was improperly build and needed to be properly built a hospital uh finan and building is extraordinarily complicated there's hundreds of places you're building and if you miss a particular cor or forget to put this in a

0:30:28particular place it gets rejected and then you have to kind of go through that we correct it most if not all of that we have a new um we had a new computer system it has grown and it has become much more sophisticated um so I would say the first place that we did is we looked at

0:30:46the whole financial structure if you will of the business part of the hospital corrected that made that much more agile much uh probably state-ofthe-art in terms of how it works uh we also renegotiated uh all of our contracts with the thirdparty payers the insurance companies which had not been

0:31:04done for several years that brought in a much more fair pricing uh from the insurance companies uh we also uh introduced a much more careful matching of the workforce with the actual census of the hospital uh rather than have that stay uh static the uh the U Workforce

0:31:24there's always a flow to the patients in in a hospital in the United States and it usually follows the weather in the summertime uh there's not as many people in a hospital as there is in the winter we're about ready to enter That season particularly as the flu sits begins to

0:31:38set in and the kids start school and they bring that stuff home and stuff like that people tend to get sicker go inside more I think we've been a little bit delayed here with the good weather um but we've also made a much more careful matching of our resources to to

0:31:53the people that come into the hospital our third area is in any business you watch your costs you grow your revenue and that is to look at additional and expanded Services um I told you about the two areas in cardiology and heart and the next one we'll look at is

0:32:08orthopedics there's an awful lot of work that's being done in terms of Orthopedics today to help people live longer lives with their joints and replacement of these and uh we intend to uh provide the additional service in that area uh and give even more reason for people to come to the hospital great

0:32:26thank you any other questions you've really described well the problems with emergency room overcrowding and limited access to health care and the state legislature repeatedly continues to suggest ways to reform the healthcare system and I was wondering I don't want to put you on

0:32:47your on the spot and ask your opinion of how we can fix it all but if it would be possible possibly to get um analysis or recommendations from your group as we are sometimes asked to make resolutions in support our opposition of these initiatives I think that would be very

0:33:05helpful to hear from folks who are on the front line um who may have more information than we have as a city council to tackle this really difficult problem that I I know that we're going to have to in the years ahead well I can agree with you more we as a country we

0:33:20Face a terrible dilemma we've never really uh fixed our health care System uh if you go internationally and you study the systems of other countries uh from Australia to Germany to Great Britain to Scandinavia you find them um doing a much more organized attempt at

0:33:37healthc care than than we are um I think we're going to it's going to become worse be before it becomes better because as you know as Americans we're aging and the greatest amount of us who have been aged is occurring now for the next 20 or 30 years and as we age we use

0:33:52the Health Care System more than any other time in our lives um to to kind of try to I my my own and here's one single editorial comment uh to try to fix what we have uh which is basically an acute care system which means that when you get seriously ill we're there and we

0:34:11will help you is really probably in the end going to bust us financially I don't think that's a good English word but it makes the point uh why is that the case is because and uh because we just simply don't have enough resources for that many Americans to be acutely ill so

0:34:28what's our choices is to help them not become acutely ill and one of the one of the good things about American Healthcare is we've allowed people to survive things like heart attacks and cancer and so they live on but a lot of times they're living on with chronic

0:34:42diseases uh or in the need for chronic care like diabetes uh our system waits till something goes very wrong like for example with diabetes some infection is going on something has to happen in terms of an outer Limb and now you're brought into into the hospital as

0:34:57opposed to we're really on top of trying to track you and making sure that um that you stay healthy and out of your chronic situation what would I do with that well one of the things I mentioned to you about that County clinic I'd look for an Innovative way for the hospital

0:35:13in that county Clinic to start some sort of a chronic disease program where we will actively track and work with people to help them to stay out of that if we can do one the good thing keep you healthy and keep you out of the institution that way would be an extraordinary

0:35:28savings uh for American Healthcare um so that that would be one example I think we all living in a time when we have to realize the institutions we grew up in may not survive Us in the way they were good in the 1800s and the 1900s a lot of these institutions have to reinvent

0:35:45themselves from government to health care to schools uh unless we do that we're going to be paying for old systems that I believe um just are not serving our current needs thanks so can I just follow up on that I think um that was very helpful but part of the question

0:36:01was can we call on you oh absolutely I think that's part of uh hopefully what we're here for as fellow citizens we spend all of our time in healthc care and working on it uh you spend all of your time trying to kind of pull together all the agendas of the public

0:36:17we're more than happy to help you with this particular agenda in any way we can day or night I had uh one question you the hiring we hear periodically at least in the public that um there's shortages shortages of doctors particularly shortages of nurses however

0:36:38uh I've known some people that are very qualified people that can't get into nursing uh schools where do you see is that improving uh if if I wanted to be a nurse or somebody wanted to be a nurse and are qualified every other way is there a spot for them to learn and

0:36:55become a nurse very good question uh I went through orientation this morning at the hospital and 90% of the new employees were nurses uh coming through there and I had a chance to talk to them directly and I actually got educated about something as you know we've we've

0:37:11had this tremendous shortage of nursing throughout the country uh both government and large foundations like the Robert Wood Johnson Foundation the Band-Aid money has put a tremendous effort to interest young men and women into nursing and it is paid off so much

0:37:25so that I was talking to this one nurse who was joining us saying that it took him three years from date of application to get into a nursing school uh I don't know how widespread that is but there seems to be so much success in attracting young men and women into

0:37:42nursing that the other part of it having a um enough seats for them in these schools of nursing seems not to have caught up with that and it's introduced a waiting period the other is uh we have uh I don't know what the state statistics are but we have very little

0:37:58vacancy for nurses in our Hospital California is probably one of the best payers of nurses in United States of America so a lot of people want to work here and when they graduate from schools or want to come here there really aren't that many jobs that are available and

0:38:13they find themselves having to go to other parts of the country so um I don't think we've solved the problem I think it's going to redistribute itself throughout the country particularly me California is a delightful place to wind up practicing nursing as opposed to a colder climate in the

0:38:28winter um but I think we're we still have a way to go to get the those young men and women into the schools and out it seems to be a bottleneck right now thank you any other questions thank you very much for your time information to be able to get back anytime you need me well it's very good

0:38:48news thank you very good news thank you next agenda please next item on the agenda is the adoption of the consent calendar including minutes for approval employee vacation cash out policy establishing an assistant program supervisor classification pavement management

0:39:06system contract Amendment the matat loal local appointment list and the September 30 2008 quarterly investment report okay any comments or adjustments here move adoption of the consent calar second it it's been moved and second it to approve the consent calendar item

0:39:28five all those in favor I opposed motion carries next agenda item please next agenda item ISL under policy manners a budget update presentation by Scott Hannon city manager thank you um before I turn it over to Scott I I brought I put this on the agenda because I thought it was

0:39:52important that um given the current uh National and National situation and it filters down to the to the uh public level that we take a look at it before our uh normal midyear budget uh review in February I think it's important that we set a benchmark maybe that's a little

0:40:14more current than the July when we passed the uh budget in July and uh certainly I think this will uh give it give us some uh IDE of where we're headed and uh also answer some of the questions that the public has had is uh where are we going how do we stand so thank you Scott sure thank you uh as the

0:40:40mayor said um a number of people in addition to him have asked how everything going on in the economy and the world affects us um the city of elero so I wanted to start with sort of the broadest and I don't claim to be an economist and I don't claim to really understand as it seems most

0:40:58people don't seem to fully understand what is going on out there and I'll talk about that a little bit but certainly a lot is happened since we adopted our F current fiscal year budget back in June um the first slide first two slides really uh without reading the whole

0:41:15thing it's was really astonishing to go back and do a little homework on what's happened since uh really the last two months at the beginning of September as the slide shows the Dow was at 11,500 roughly as a comparison on July 1st when the budget began uh it was at just under

0:41:3811,400 so really a lot of what we're feeling and have certainly feeling uh as a city has happened really in the last two months um and continues in November but uh just to Rattle off some of the events that the chronology is almost scary because a whole bunch of these and I

0:41:56didn't go into everything happened day after day after day in uh September and October but as you may recall with Fanny May and Freddy Mack the treasury seize control and inserted $100 million to each of them additionally uh Leman Brothers filed for bankruptcy which was

0:42:15the largest in history soon thereafter uh Bank of America bails out Merl Lynch the government bailed out AIG which was 85 billion I believe it's considerably more than that now uh more importantly I think for us and just for uh people's nervousness uh money market funds couldn't maintain a

0:42:34dollar share price which is where most people Park their cash um in between Investments so if it goes below a dollar you're essentially losing your money wherever you leave it other than uh your mattress the three-month treasury bill rate dipped to just above zero and um

0:42:51soon after that the federal reserve put the first 60 billion into the finan cial system and then the much talked about tarp 700 billion bailout plan began being talked about in September Washington Mutual which is very prominent around here was seized by the FDIC and sold the JP Morgan Chase uh it

0:43:11continued in October and I thought some of the things going on in the world were also interesting that I didn't realize was that the EU has has committed over 1.8 trillion EUR to guarantee their Banks uh additionally they took equities stakes and two of the five largest banks

0:43:28in Europe and the our Federal Reserve provided unlimited dollars to the European Central Bank to help prop up uh the European market $250 billion was used for direct equity in the banks which again is is something that is unusual in our history and then the federal funds rate dropped to uh

0:43:491% and now as as I'm sure everyone knows the automakers are looking to get in on the bailout also I didn't put on here wacovia also essentially has disappeared and was absorbed by Wells Fargo the Dow Jones ended the month at 93 just over 9,300 which is a 2,000 Point drop in the two

0:44:11months and for those of you are interested it closed at just under 8,300 today so another thousand Point drop for those who prefer it graphically you can see um if you look at essentially July the market was down only around 4% when our budget was uh budget began let alone

0:44:35when it was adopted it was closer to only being down 2% for the year if you look at what happened in September October uh the market has fallen uh through October 44 points and now that number is in the ' 50s so I just wanted to point that out as it relates to municipal bonds which

0:44:56is really uh critical for us um you know it's certainly not immune to what's going on in the private sector the what's what's really scary for municipal Bond folks is what's happened to the insurance industry and I'll talk a little more about that uh and the underlying credit ratings because the

0:45:15insurance this this insurance industry which is historically considered one of the most safe places to uh invest has really had trouble this past the past 3 to four months really um the use of tax exempt and taxable Municipal buyers which uh is getting smaller and smaller

0:45:36so for instance um six months ago nine months ago a year ago when our Redevelopment agency went out and issue bonds we were we were pretty certain we were going to get a good price and get competitive bids which has always been the case um up until the last couple

0:45:50weeks we were reasonably certain that if we tried to sell agency bonds we would have no no takers at all that's really how the market has swung and that's just in a matter of months uh in October uh this is the words of our financial adviser use the term dysfunctional uh and the number of

0:46:08issuances uh were way down and the interest rates were way up as an example when you think about our timing when we last bonded for the measure a streets program uh we our bonds went out at 4.8% if we were doing that now it would be somewhere between 6 and a half and 8%

0:46:28which would be significant amounts of money that we'd be spending on interest rather than on asphalt and again Redevelopment agencies are typically hurt more about this because of the nature of what they are and relying on tax increments so uh the city is less at risk because of its the

0:46:46multiple of Revenue sources compared to the Redevelopment agency the available buyers uh are expecting much higher interest rates and demanding more for purchasing lower lesser rated credits so we are not generally a lesser rated credit but it's just generally becoming harder to sell

0:47:06and much more expens expensive to sell bonds um I'd love to take credit for this slide but our our financial adviser actually put this together and the reason the main reason I wanted to show this is because what's going on many of you may have heard about credit default

0:47:23swaps which is behind a lot of the chaos in the market which are described essentially as private unregulated insurance against corporate bond defaults there's no Clearing House no regulatory framework and I really wanted to point out where no transparency and that's something that's discussed a lot

0:47:40here a lot with government and it's somewhat ironic that with all of this going on the main reason that the credit Mark markets have seemed to seize is because none of them as depicted here has any idea what the others are doing and how leveraged they are and how much

0:47:57exposure they have how much risk they have so they've all sort of ducked their heads and said we're not lending money to anybody uh until it works itself out but again as you as we have talked repeatedly here I mean we try very hard on the government side and particularly

0:48:12on the elero side uh to be very transparent and from our our financial reporting check registers up to our crime reports on our website to broadcasting meetings and webcasting meetings it's just interesting that so much of the world is in the private sector and where we are where we are um

0:48:32the only Point other point I want to make about this is the amount of money uh is really unknown according to our finance team of what what the risk is out there and how much it's really going to take to write this um so moving on I'll talk a little more about getting a

0:48:48little more elero specific there's certainly with all of the mortgage crisis there's a lot of talk about housing and property taxes is certainly a big part of where we get our Revenue as you can see from the top chart uh housing sales have been relatively consistent although it's it's

0:49:06interesting how volatile they are based on Seasons you can see that line jumping up and down but uh I think a few things that are really important and that have really been helpful to us is as you can see in October 206 the market was very high we had 14 properties sold this

0:49:24October we had 14 property sold uh the big change is the volume on the market and that's that's where our property tax if it's lower that's where that's the reason but we accounted for that as I'll show when we put our budget projections together as it relates to property

0:49:43tax on the next slide uh again graphically it shows the last two years and I and I do want to point out this big $194,000 change it was really an anomaly October 06 there must there may have been some house or houses that sold so far above you know asking price but the

0:50:04but if you look at November or the months before and after essentially home prices two years ago were in the sold for in the $640,000 range and currently they're selling in the $600,000 range so here homes home prices have remained relatively constant certainly compared

0:50:22to what's going on in excuse me in other places additionally in 2003 the sale price was 495,000 so as homes change we still well above the price from 5 years ago um the other thing that I would point out where the property tax changes is on uh home sales the current median single family home

0:50:48price in Els Sero assessed value is 263,000 so when a home sells for 600,000 it's typically reappraised at the sale price is where we get the biggest benefit in terms of property tax is is essentially turnover on the next slide um wanted to give another snapshot on the property

0:51:08tax and assessed value I showed the cities who've had the their assess value reduced the most going into this fiscal year that really hurts their Redevelopment agencies um and I showed the top four with elero being the fourth uh just under 4% the average for the

0:51:29county was less than 1% and our budget projection for this year was 4% so we're essentially On Target before any of the homes that sell during this fiscal year which would be reflected in our supplemental property taxes now again on all of the revenues I talk about I really do want to stress

0:51:48that we're very early in the year for many of the sources of revenue we've received none or one payments for property taxes we haven't received anything yet so it's really difficult and at Mid we'll have a much better take on our revenues but um we're doing the

0:52:05best we can a few months in foreclosures are obviously something talked about in the news and something um in Els Sero we're very fortunate about if you look uh as of the end of last month there are only 11 foreclosures in the city and a of those at any given time there going

0:52:27to be a few if you compare that certainly to what's happening in East County um and some other places um I think you can see that elero Albany Berkeley and Kensington and I couldn't separate out the Kensington numbers the Foreclosure crisis has essentially swept

0:52:44over us what time period is this for this was as of um the end of October how many were in foreclosure at the end of October at a single period in October and this was reported um through this by the San Francisco Chronicle put all this together and then I just wanted to show

0:53:02a few others um so clearly this is a significant problem in different places but we are very fortunate here um I think largely because of our demographics our location and other things uh how long people have held their homes that we just it's just not really affecting us uh much

0:53:21here in terms of overall revenues uh again I wanted to keep it somewhat broad because it's early in the year anything on the graph that's green bright green or light green we're we're pretty comfortable that we're on target for this fiscal year based on performance to

0:53:39date as well as comparing current Year's performance to the last two or three years of performance and our projections the other Revenue category the reason we yellowed that was for the first time in October we saw a decrease in the number of permits pulled so we

0:53:57don't know whether that's a blip or whether people are starting to rethink uh uh doing work on their homes which clearly has an impact on our our permits and plan checks um in the time I've been here and before that that our number has been almost constant um the the the work

0:54:17being done in the city so we'll be we'll certainly be watching that but again it's we we did notice a significant change just in October we really didn't see it before that sales tax um obviously what's going on in the economy affects sales tax we have probably three

0:54:36things that affect our sales tax and why we the reason we made it Red is because we know at mid year we're going to recommend reducing sales tax uh last year sales tax numbers came in less than we thought they would at midyear and when we were putting the budget together so related to that our

0:54:53budget going forward tied to sales tax was higher than uh we expected to be and then you know we've all talked about the store closures we accounted for Target we didn't account for Mitsubishi um and there there some of the new players we just don't have any information on yet

0:55:12on how they're impacting us but we are we are reasonably certain that we're going to want to bring our sales tax projections down the other area that I wanted to mention was utility user tax in our budget proposal and subsequently budget adoption we talked about

0:55:28beginning collections as approved by our voters from the East Bay mud finally after decades almost not playing their share of the utility user tax um they have essentially agreed to do that and we're working on the mechanics and hope to bring that to the council in the next

0:55:45month or so we so far this year our numbers look strong with or without that collection but you know that's a collection that we feel uh certainly in these times would be would would be helpful and again we budgeted about $200,000 for it the only other comment I'd make on

0:56:03revenues is um the sales tax collected for measure a was right on Target in our first sales tax check as you recall we were very conservative with our debt coverage R ratio on sales taag so we are we're right on in our first check and that was probably a little bit low as people are

0:56:21getting up to speed so that that was a really good sign on the expense side and I'm speaking specifically of the general fund since that's where most of our services are paid for to date expenses are 3% below budget um so that's positive that's through four months and

0:56:41we have begun Bel tightening obviously with everything going on in the economy and unknowns um all of the vacancies and new hires that were approved for July 1st none of those positions were approved in the first quarter uh or none of the we didn't allow anyone to start

0:56:55in the first quarter we have filled a few positions others are still uh vacant and then we've had a few vacancies that have come up which we have not filled and we're we're taking sort of a wait and see approach as we get through the fiscal year on uh filling the remainder

0:57:10of the positions that are that are open uh in terms of our vehicle replacement fund over the last years we've done a really good job in replac replacing our vehicles and paying in advance for our vehicles and that fund has significant amount of money in it um one option similar to what we did with

0:57:29the police department this year is relying more heavily on the vehicle fund and I think that's also we've heard from our Auditors that it's consistent with our fire trucks as you may recall uh in the past two years we've decided to do lease purchase AG agreements with a

0:57:44number of our vehicles that has freed up capital in the fund because we're not laying out all that Capital up front for uh fire trucks however since they are assets of the city um there were properity to be recognized in the fund so that's something we're considering is

0:57:59is utilizing that fund a little more than we had planned but again that's cash on hand and we have no concerns about using some of that money that it won't hurt any replacement of our vehicles um obviously we're looking at all purchases uh about delaying purchases

0:58:16reducing purchases um again as uh just to be prudent as we work our way through the year and the only Capital project we've talked about out and at least on the staff level have reached somewhat of a consensus on delaying because again it was the only general fund Capital

0:58:31project in the budget is holding off or possibly postponing um the HVAC system for the community center there's two pieces to that project one is aesthetic improvements which we are going forward and we're are planning right now and those are um renovations to the

0:58:48bathrooms the flooring um paint and other other aesthetic features to make the make the community center much more renable it's never had I don't know about never well I don't know if it's ever had an HVAC system or certainly a functioning HVAC system not in the long time um that

0:59:05that's not the biggest problem the getting the Aesthetics done and everything um much more rentable including the courtyard improved we think should go forward but we are going to hold off on the HVAC system till either the end of the fiscal year or not at all this fiscal year and revisit it

0:59:23in the future one other expense that's been in the news a whole bunch that we just thought we would mention uh is fuel and in July uh for this fiscal year we increased our fuel budget by 20% and as you can see in July we were purchasing uh diesel at 397 and our most recent purchase price was

0:59:43down to 220 with the falloff so hopefully we will be comfortable uh with fuel although it certainly has gone up dramatically and maybe more so than we even imagine in terms of City Hall as I alluded to earlier the concern we have is related to our shity bond and this is

1:00:05something that's very common we've done it with the re in the redevelop Redevelopment agency in the past um we withh we hold back similar to when you're doing a mortgage um one year of Debt Service payment it was our intent and our financial team was very comfortable with this because what has

1:00:25happened has never happened before as far as we know in history um we had planned to replace The Debt Service fund with the de service the reserve fund uh with assurity bond and again that's very common lowrisk uh proposition however our our uh Bond holder or Insurance

1:00:46holder I should say uh ambach like most if not all of the other um Insurance writers as I mentioned on municipal bonds have been downgraded by the rating agencies so they are not in a position now and this is why municipal bonds are not moving to write uh insurance

1:01:04policies as you may recall a number of our bond ratings have been upgraded from sort of double A minus to AAA because we have shity Bond we have not shity Bond but we have insurance on the debt um all of these shy Bond potential shy Bond buyers are have been hurting with this

1:01:22economy our our potential exposure is $160,000 that we did not budget for for this fiscal year however we you right now we need to just sit back and wait because uh ambach as well as the others could certainly come back the way things are changing in the next few months we

1:01:42don't really have to make a decision for the next six to nine months on whether or not we'll be able to get uh uh the shy bond this year but that is something we just wanted to raise now as this was probably the only true unknown that we had no idea when the budget was approved

1:01:57that we could see this coming um what are what are we thinking about um what might we be coming back to the council with in the future right now the uh you know the best case scenario is we make our Revenue targets that would likely be done with sales tax down and other

1:02:17revenues up in the worst case and I this is what we perceive to be the worst case this early in the fiscal year is sales tax could be way down uh from where we budgeted and other revenues could fall off as I as I mentioned earlier uh where we could be about 700,000 behind in

1:02:37revenues how do how we would manage that as I talked about um through holding off on hiring keeping vacancies open and this is something we're already doing I mentioned the vehicle fund and just by General Bell tightening um not making certain purchases trying to find ways to

1:02:57do things more efficiently do it with less staff or less frequency depending on what the service is in the extreme uh we believe that we could do through vacancies and hiring the the savings shown here and again using the vehicle fund we're very comfortable with

1:03:14that amount does not threaten any vehicle purchases or replacement of any vehicles in the foreseeable future uh the shy Bond we have to pay for uh we had talked about holding off on the HVAC and what I describe as other is essentially us bringing in expenses 1%

1:03:31below budget uh which is 250,000 we have done that uh almost every year that I've been here so I I think that's something we could do I think that gets as we've talked about much harder to do every year because every year we seem to hold we talk a lot about the other expenses

1:03:49um that our Personnel is pushing about 80% so you you know when you're talking about saving uh $250,000 on the other 20% you know it certainly gets harder every year when that piece of the pi gets smaller and smaller and smaller but I think the point we're trying to make

1:04:07at at least at this time of the fiscal year we're not anticipating any Cuts in Staffing or any uh Cuts in service you know that could conceivably change but we don't we believe that we can get through this fiscal year uh without any of that and and certainly that's that's

1:04:24our plan in terms of our investments um we our policy as you see in quotes is to buy and hold to maturity we don't do a lot of trading uh we're not anticipating any losses in our investments we're still getting positive returns as you may have seen on this investment report as well as others we

1:04:47do hold Fanny May and Freddy Mack bonds which are very different than having a mortgage holding mortgage or shares in Fanny May or Freddy Mach we are we are actually not concerned and it is um that they are secure and federally insured and we are getting our return and the

1:05:04return is not significantly changed and we're actually not particularly concerned about it but I wanted to make sure that uh we did bring it up um Leif which uh which is where many if not most local agencies uh use uh through the state treasurer's office um is one of

1:05:23the safest places to invest and that's where we keep a majority of our money the return is better than a lot of other places although generally it's a low return uh low return very low risk our money market earnings where we essentially have fund our operations uh

1:05:40the return is very low like anywhere um but you know we certainly much would prefer to opt over uh safety over uh return at this point and the other thing I want to mention because it's been in the news a fair amount with municipalities who have variable rate debt we don't have any variable rate

1:06:01debt and don't plan on getting into any variable rate debt so that's why we're comfortable that we have all fixed rate obligations and are in as you can see in the investment report that was on the consent calendar our investments have are holding uh even though the the

1:06:16returns are less than they were maybe a year ago there're still they're still holding and we are still getting a positive return on our on our money the Redevelopment agency is probably where all of this um all of the changes in the economy have hurt the most um

1:06:33first of all the as many people are aware the state has essentially taking uh $362,000 from the city's Redevelopment agency to balance their budget this fiscal year uh we will be back uh to making it get that appropriated uh to send them a check which is particularly

1:06:55anointing frankly since we don't have the money we they're making us get the money and then cut them a check back so it's a little frustrating it's almost like they're they just want us to go through the fun of cutting that check and sending it off to them um the

1:07:12current What's called the ER shift it's an educational shift uh to state education funds doesn't hurt our debt capacity but future ER shifts uh could unlike in the past when the state has done a takeaway in the past they have often extended our plan or extended our

1:07:32ability to borrow in this case there was no benefits given back to the agencies there no extensions and no way for us to recoup the money so while this is a one-time takeaway now it's really questionable whether the state now in a 10 to 15 billion dollar hole again um

1:07:51we're obviously worried that they're going to come back to the Redevelopment agencies for more and make these Cuts permanent um the California Redevelopment agency has filed suit against the state and as some of you may recall when propun was passed to protect local government revenues um

1:08:11Redevelopment agencies and were assured by the state that they did not need to be part of that because they have constit constitutional protection from this kind of thing and that state is now Chang that argument and taken the money uh it hasn't been announced it but CRA

1:08:29is looking for some of the larger cities to go in with them for more visibility and more clout on the on the lawsuit and as we hear more we'll certainly share it and again you know we are watching that and would not be surprised if the state tries another shift um this year

1:08:47fortunately in our case for onetime ships ships we still have a cash balance so we're not making any cuts to cover it it's just a a check out of money that would have gone towards other projects such as the library the senior center San Pablo Avenue whatever those things

1:09:02would have been the impact of the economy generally is sure on the read about the previous slide you said the 362,000 we're writing a check though we don't have the money well explain you want to explain that no we have we don't have this year's money yet they will

1:09:21they will convey us the tax increment um through the county and then we will cut a check back to them and when this has happened in the past with the general fund they have taken the money due to us and deducted the amount they're going to keep but for some reason with the Redevelopment agencies

1:09:38they're making them go out do an appropriation and write a check back to the state so the state sends US money and then we send it back the state sends the money the counties collect it and send it to us they could remit that money straight to the state but instead the

1:09:53the state is billing us so thank you in ter again in terms of the agency and projects there are four projects listed here that receive their entitlements and for one reason or another but as far as we know mostly economic and ability to get financing particularly on projects that had owner

1:10:16occupied units um they're just not able to get financing for those projects at least not at at least not at this point um for the Redevelopment agency itself the loss of these potential projects is about $600,000 a year currently and 10 years out would be worth about a million

1:10:37a half dollars a year in terms uh over 10 years that's about $1 million and it impacts our affordable housing our passrs to other other agencies and our projects Debt Service programs and all of that we again we are we are comfortable with our tax increment and

1:10:57our bonds there there's no concern there at this time but it really inhibits our ability to do the lot of the projects that we've done like San Pablo Avenue and a lot of the talk about the senior center or the library other public projects we really need um the tax

1:11:12increment to continue to go up and not detract and new projects generate the largest opportunity uh for debt capacity as you can see on the next slide the $600,000 translate into almost $8 million of borrowing power and the credit Market crunch with the higher interest rates over the time will cost

1:11:35us almost $2 million more in financing charges than uh it would have 6 months ago and what's the remaining life of our Redevelopment agency I want to I'm believe it's 2023 but I would probably want to check that about that another thing uh since if we didn't have

1:11:58enough to keep keep our eyes on um something interesting happened last week um and it shows how volatile Commodities are and everything relates to everything else um almost over a weekend um the recycling Market World well it's it's worldwide but certainly the Asian market

1:12:16and the majority of recyclables particularly paper on the west coast are processed in Asia um the recycling materials markets essentially crashed from Friday to Monday almost and we're talking about somewhere in the 5060 $70 a ton positive to almost begging people to take the

1:12:35material so you don't have to pay to store it um as as many of you know I've been doing this on and off for over 20 years and while the markets have been volatile at times I we've never seen anything like this so so fast and so drastic and we're really going to have to sit back

1:12:52and watch it what that what that means for elero is the way we set our recycling rates is we have a long history of what we get for recycling markets and we budget looking forward and we reduce the rate based on what we think we're going to get in revenues we may because of this have to

1:13:11take a step back and budget as though we get no revenues see what we collect and then do a credit for the next year forward what that means in the short term is a bigger rate increase that you hopefully can offset in the in the future and um we are updating all of our

1:13:28forecasts talking to as many different buyers and vendors as we can and if we went to zero we're probably talking about as much as a dollar increase um to the recycling rates which is you know about $12 a year um we'll be back in December to talk more about that at it's

1:13:48the time we do our raid setting I I have a question about that um um I don't know if you felt much about the explanation for that if you have any idea but I was wondering if it related to a Slowdown in um the interest in materials used to produce other materials uh caused by the overall slow

1:14:09down in the economy oh yeah certainly I've heard that as a significant explanation of a glut of materials um which long-term contracts expiring which would mean I mean if that is in fact the case that um it means that really the price isn't the price is just reflecting the market yes it's it's

1:14:30like the real Market not the um the scare of what might happen it's it's that nobody wants it because nobody has a need for it right now much less of a need and there's enough of it out there that you don't have to pay for it because if we don't we could either give

1:14:48it away or we have to landfill it and pay to get rid of it so if there's enough out there and that's sort of just a law of supply and demand um will'll take your paper if you can get it to a dock what about other materials like um aluminum cans or my understanding is

1:15:08generally across the board prices are are either zero or close to it I mean there just seems to be the you know you we everyone focuses typically on gold and rare Metals but I think the whole commodity Market is it's just a ripple effect and like you said as um in terms

1:15:25of our materials Asia and specifically China is by far the biggest purchaser uh of recyclable uh postc consumer recyclable materials and if China is not producing all the things that they sell back to us made of or coming in cardboard or paper obviously that that's going to affect

1:15:44the markets dramatically so but we're we could will be providing we had some information in your weekly report last week and we're we'll keep trying to get information on what happened and why and what the best course of action is on the future uh but again that was one that we did not see

1:16:00coming uh we didn't actually we didn't see coming three weeks ago uh so what we're doing is we we monitor uh revenues constantly I don't know I would say daily but close um you know much very much as thoroughly as I believe we've always done it we're look we're watching

1:16:19much closer we're watching expenses much closer we have already implemented a number of cost-saving things as I've talked about particularly around vacancies and hiring but we're also looking at everything we purchase and do um we'll be back in late December or

1:16:34second meeting of December to talk about recycling we continue to always look for efficiencies and cost savings and then we'll be back in February as we do every year with an update and possible adjustments going forward but overall certainly compared to a lot of cities

1:16:49and a lot of cities around us um we think we're in decent shape and we think we will come out of this year okay all as I said here all things considered but I I don't think there was any way that everything going on in the market was not going to affect us in some way shape

1:17:05or form so with that I'd be happy to take questions um Mary Dodge our finance director here um again we were not planning to go into a lot of detail at this point but we'll do the best we can if you have questions yeah CH yeah I I just have a couple comments um you know it is rather stunning to you

1:17:26know sit and listen to um what's going on not only in the country but in the entire world um you know JP Morgan alone wrote something like uh10 trillion of derivative contracts backing um their credit which is about 3/4 of the size the whole US economy I mean it's just

1:17:45sort of unfathomable and how that ties together those derivatives tie together with the whole Global um Financial world we're starting to see the repercussions of all that so obviously a lot of this we don't have much control over but when I look at this um I think that we've at

1:18:03least made some wise decisions in some of our policies in the past and the fact that we have the vehicle replacement fund which is you know something that we're always going to need to fall back on things happen to cars to trucks um to the Corp yard um uh Vehicles also our

1:18:19recycling so that was a wise decision that was made and um and the fact that we don't have any uh variable rate debt but when I look at some of the things we might have a little more oh and I wanted to make some comments about the permits I mean I think that's probably our

1:18:33direct relationship to um you know consumers financing and lending is really tight right now and I don't even know that many people can um get much line of credit so I don't imagine our permits um for um it's good that it's yellow in here because I don't think we're going to see much change in that

1:18:52and it might actually go down quite a bit um so I think that's understandable some of the sales tax I think is going to be a problem too because people aren't going to make those big purchase items although I think Honda actually has been somewhat steady at least

1:19:08through September which is kind of amazing but they do have a hybrid so maybe that's why um so I had a a couple comments about the East Bay mud uut now I know that we've looked at it it's not a lot of money but um $200 $300,000 right now would look pretty good so I

1:19:27know that there's been some issue um with them implementing how this might be collected and I'm not sure where we were at with that so I have one question about where we might be with that and how much more um assertive we could be in in moving forward and um then my

1:19:45second question was about the um Aesthetics to increase the rentability at the community center I was wondering how much money that might be I I know that the the big item is off the off the schedule right now but sure we still would leave uh I want to say close to

1:20:01I'm looking back where Jerry is I want to say that leaves about 280,000 still in there okay for the for those improvements and we're we were comfortable that they would come in less than that yeah and I I think that's probably good and I think that you know having the council chambers in the other

1:20:16room has decreased the another area where we can program and you know we we do have um um a lot of uh programs that our community really is very interested in and I think sometimes when you get into hard Economic Times people look for what they can do close to home and I I would

1:20:35like to see those continue they're they moving forward absolutely um so the my two questions were about the uut for the East Bay mud and then you answered my question about Aesthetics so thank you and again thank you for Mary because I think um she has a lot of insight into

1:20:53um a lot of the decisions we've made and I think that now we're seeing some payoff from it and I think that's a good thing in the fact that we're not over indebted the Redevelopment agency is a whole different BX but I don't think we have a lot of control over that with

1:21:06what's going on in Sacramento right now I would just add related to the East Bay mud the mayor our finance director and the City attorney were meeting over at East Bay mud and uh we are getting closer to being able to bring something to the council for hopefully with a recommendation on how

1:21:25to proceed with implementation but it's been very difficult to move that staff along um while they acknowledge that it's it's our right that our voters acted that yes they should be collecting on our behalf similar to any other utility or our franchises or anybody who

1:21:42collects a fee fee or tax in this case a tax on our behalf um they are doing everything in their power to make it as honorous as possible uh so we're hoping we can come to a resolution on that but uh you know in either case we'll be back to the council hopefully in the

1:22:01beginning of January that's great thank you and I I think that some of the um decisions that you're making about the free and on not only some of our own plans but also in the hiring are also prudent at this time I really appreciate this presentation today and I think it's

1:22:22great that the council member elects are here today also to engage in this update and to help us have more information as we move forward I get information every day like everyone else in the news and um through email through our weekly reports through talking with friends and

1:22:40families and it's a very uncertain time and I think it's worrisome and so this presentation really helps to put it in context what the impacts will be for the city of elero and I think that it's clear now that the economic downturn is affecting individuals and families and

1:22:57businesses and government and nonprofits and and we're all going to have to make adjustments so I found it really reassuring for us to understand right now what our major exposures are and the steps that we can take as we move forward to deal with the reduced sales

1:23:14tax and the issues um of the assurity bonds for um some of our Capital Improvements also um the question of recycling and I feel comfortable with um the belt tightening and some of the delays on hiring and other projects that youve discussed and um I just really

1:23:35appreciate it and I think that as you said all things considered we're doing really well so I appreciate it thanks I'll just um comment on the recycling Market or the recycling Revenue Commodities Market issue that also came up at the last waste Authority board meeting as they were doing the

1:23:54rate setting that is in fact when the issue was was live it had happened maybe the day before a couple of days before so um they're working through the very same issue having the same discussion because um the Waste Authority for the rest of West County does the same thing

1:24:09it takes in um recycling revenue and uses it to offset the rates to the rate payers so to the extent that we are struggling with this issue we can work with the Waste Authority to um use their resources to get more information as well but it it was a large part of our

1:24:26discussion at the board meeting last week any was there any uh conclusions to your to the thoughts that came up or um not really I mean they knew even less than we know right now and um I think the only thing that they were sure about is that um staff would be coming back to

1:24:45the board with more information and that the projections that went into um the rate setting and budget discussion that 6 months out um the board may be revisiting that thank you J yes I want to thank staff um for a very good presentation um and um it I think it was

1:25:09really clear what was what's going on within our our local um City picture um the one uh thing I'm um I still see in some of the meetings that I go to uh are parts of it that really are not what I would call internal but rather external um such as um you know the impact of

1:25:30what the state might do on us um and as we know there the uh legislature has been called back into an emergency session to to talk about it um one of the things that I'm actually going to be doing in the next few days is going down to a meeting um with um people from the

1:25:49league of California cities to set the uh goals for the next next year for the league and I'm sure that uh one of the things we will be talking about is um you know what the impact is going to be of what the state might do and um what we can do to protect ourselves against

1:26:07it and um as I think you all remember uh we did pass the voters that is uh prop 1A which goes a long way to protect Lo local government funds one area that it didn't uh really protect strongly was Redevelopment funding so um that's one um I think likely area where we may see some

1:26:32problems if they're going to occur because they could just go after that a lot easier than they could our um other revenues and um so it'll be interesting what happens this uh next weekend as I go down to um meet with other people from other cities and um we um I was at

1:26:54the um I'll just sort of halfway give my report now if that's okay because it's really this topic we had a um at the East Bay division of the lak of California City's meeting last week we had a presentation on the real estate aspect of this and um it was kind of

1:27:13interesting because we had had one a year ago when we were told basically that everything at by this time would be just fine thank you very much and as we know things are not fine thank you very much um they're maybe not as bad in elero as they are say in East County or

1:27:29somewhere else but they are you know we we see it too and um the um The Parting words we were left with by our speaker who uh represents the real estate industry um were that he doesn't know what's going to happen so I think it's just a big unknown uh you know if you go by what he

1:27:48says and uh uh based on his track record I say he doesn't know so so um so that's a a pretty likely con conclusion but I think that our staff uh has has done a really good job of presenting all of the things that we have control over and I'm glad that you're taking what looked to

1:28:10me like preemptive efforts to make sure that things are safe uh and that safety comes first in in terms of protecting our resources in our city and uh continuing to provide the services that our residents depend upon so I want to thank the staff um for doing that and I

1:28:30assume that means Mary and her staff every everyone contributes to this thank you very much can I um just uh one thing I thought of when council member ablon was talking that I wanted to add and it's the reason the intergovernmental Revenue bar that I showed went from dark green

1:28:48to light green um we we focus on the fact that this you know the state is that giant sucking sound um but more closer to home um as you know there are a number of other agencies we rely on the city of Richmond for dispatch Services records Management Services uh

1:29:08for police and um the court system the county for animal control jail services and what we're seeing we've always seen it but what we're seeing more and more is while we struggle every year to keep our expenses as low as possible these pass through costs are going up clearly

1:29:29higher much higher than our colas our cost of livings and so everyone is looking down the food chain to try to solve their problems and we are the lowest form of government on that food chain um the police chief could speak to this much better than I can but when you

1:29:47look at our expenses in police we talk a lot about traffic program but you look at the actual revenues that we get it's a fraction of the cost to get it I mean the the theory that somehow the revenue from parking tickets or speeding tickets somehow you know making us uh a windfall

1:30:05um it's costing us a lot more to be out doing traffic enforcement than to do it because most of the money collected goes someplace else um related to Police Services there's a new fee and again I'm not overly familiar with it so again the chief is back there but it's our

1:30:23understanding the county is implementing a jail access fee this fiscal year now from a city manager perspective as opposed to maybe the police chief's perspective I would suggest that he just drops them off at Martinez in front of the building instead of in the building

1:30:37um but I mean I don't want to be too flip about it but we are getting hurt by all of the I mean this should be a very stable source of Revenue and it's not because every year everyone is trying to help themselves and it's something we really see with booking fees jail access fees um it

1:30:57really affects Public Safety Animal Control fees way up um so anyway I just wanted to put that out there because you may be hearing more about that at you know at mid year and there as you've seen in in weekly reports um the and Sky could speak to more than I can the City attorney um we've already

1:31:18gotten into it the cities throughout the uh state with the counties on admin fees related to collection of taxes and collection of fees because they've decided that it cost them so much more to collect even though it's sort of an initial input and then you're done and

1:31:34our again our share of the pie of throughout the state keeps getting smaller and smaller and smaller so I just wanted to raise raise that thank you any other comments I'd like again thank staff for uh doing this at this particular time I think it gives us is a good snapshot of where we're at

1:31:55um I I don't know where we're going to be if it fell that quickly in two months where we're going to be I there's things going on that hopefully will write the ship and we can uh uh kind of ride out 2009 and see where we're at at that point as far as the city's

1:32:14concerned um I did I did have a question could you go into a little bit more detail on why our investments in Freddy Mack and Fanny May are are not endanger at this time and were was that part of was that part of those two organizations um covered by their bailout or are they separately

1:32:41funded and and in bonded against or insured against there were the two different types of Securities there are the what's called agency bonds and then then there were the stocks which were the share items that Scott was talking about and it was the area in the share

1:32:57items that was basically devalued and had their problems with losses on the um on the bonds these are one of the four or five categories of agency bonds which are the fanny Maids the Freddy backs the home loan Banks and all of those have a federal Agency insurance and they are

1:33:18still insuring them so basically we would buy a 3E 5e whatever term bond at a fixed rate of earnings could have a call provision in it but if you which would basically mean they might say that uh if in 6 months they can get a better rate by buying it back and reselling it

1:33:39they can do that this is what the call provision would be but pretty much so you buy your bond you hold it to maturity you receive the interest rate they quote you at a federal federally insured uh backing so these are are very um stable Investments even fetan you may

1:33:56are they are they insulated is there a is there a wall between the bond and the and the stock into things are they insulated from what happens to their other part of their business that's being bailed out right now yes they are now exactly the structure between the

1:34:12two I don't know that I could explain that to you but I do know that the stocks had in fact I don't know if our City attorney knows more about this than I might but the different between the structure between the two within the stocks there was um a lot more volatility a lot more speculation and a

1:34:32lot more of the um credit backed mortgages as opposed to the structure of the entity selling Bonds in itself and I'm sure I could get more detail for you if you'd like but other than that um I do know that they are separate I do know that the bonds are guaranteed I do know

1:34:51that the the stocks are not great I appreciate that thank you and uh one other thing before we close I I really like the uh Team of Third Party Experts that we call on that uh I think we've used very well well at least the four years that I've been on but um it it is good to get that type of

1:35:17expertise going when we're looking forward and trying to make decisions that uh uh to run the city so that is very good anything else there a public speaker I ask for public speaking uh is there any public speaking people would like to come up and uh take three minutes to comment

1:35:39or Peter Lal interesting presentation but I still don't know why now in the lame duck session you'd have this meeting and I think I like to read between lines I see the well you just took away the last sentence and it says overall Elio is in decent shape All Things

1:36:08Considered and I think that maybe one reason for this meeting is so the two council members who are leaving can feel hey we're leaving elero in good shape well as Scott made it very clear things change from one day to the next they can unravel very quickly and I know a lot of

1:36:28people who expect high unemployment in the country and including in alaro and the very worried business people who who say there's a good chance that half the plaza will have empty store will be empty stores uh by by next summer and uh I don't see us or you dealing with it in this

1:36:50discussion other than Scot sort of reassuring staff we don't plan any staff layoffs now uh there's a lot of talk about Redevelopment and quite frankly listening to what you said about Redevelopment you know how do we stop the state from taking our money and yet

1:37:10watching what you're doing uh paying $4 million to land bank the uh tradeways and I I wish the owners well of course or land banking May F when uh Alan is here he knows very well that any amount all advisory Redevelopment committees that don't land bank yeah so you're land

1:37:31banking probably to make sure that the state can't get hold of the money but what you're not doing is for instance making sure that we get a good Library you the money might go away our our development money might go away and we'll end up with a movie theater and I

1:37:45still have kniv over and over again I've been asking what's happening with the 10,000 a month they're supposed to pay as far as I know they're not paying so there goes a $7 million subsidy Redevelopment money I hope the state I make sure the state knows about that and

1:38:00Target stores closed as far we were always told that if it's closed for more than 9 months I believe or 6 months uh that the land reverts uh to the city or to the agency no talk about that uh I think there's a lot of things missing in this presentation and our new council

1:38:19members will have their work cut out for them it'll be tough thank you very much thank you just reminder as it was before it was an overview of the current situation it wasn't on the agenda to discuss so we're in good shape there all right um Council assignments lays on reports

1:38:42any there I have one um the Alo crime prevention committee met on November 12th and there going to be planning a spring Bike Rodeo um this is a um an event that's been held in the past many years ago um focuses primarily on um inspection and safety um for bicyclists the police department will be

1:39:11participating in this um they'll probably have an obstacle course set up a helmet instruction and fit for residents and and um coincidentally in our Municipal Code all all people who ride bikes and ELR are supposed to have helmets as opposed to with the state law

1:39:30is which is just children um which is something I learned Chief's back there um potentially the date could be on Saturday May 16th and we don't have a site for it and the date might be changed depending on when the officers that are going to be participating are

1:39:49available that's all I had great um the only meeting I had was the Waste Authority and I provided a report when we discussed the revenue R recycling Revenue Commodities Market problem great thank you I just wanted to announce that um the arts and culture commission will be meeting this

1:40:09week Wednesday at uh 7 o' to discuss how we will select and manage a gallery space at City Hall on the second uh level and it should be a lively discussion and everybody is welcome to join anything else thank you just a reminder that uh our next meeting will be held Tuesday

1:40:30December 2nd uh beginning at 7:30 and since this is the last meeting before the Thanksgiving celebration uh to you and yours on behalf of the city council uh have a nice holiday we'll see you in December meanss journ thank you that