TO:
Honorable Mayor and Members of the City Council
THROUGH:
Bruce Moe, City Manager
FROM:
Steve S. Charelian, Finance Director
Julie Bondarchuk, Financial Controller
SUBJECT:Title
Consideration of Adopting Resolution No. 23-0158 to Modify the Storm Drain Measure Ballot Question on Resolution No. 23-0149 (Finance Director Charelian).
(Estimated Time: 20 Mins.)
ADOPT RESOLUTION NO. 23-0158
Body
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RECOMMENDATION:
Staff recommends that the City Council adopt Resolution No. 23-0158 to modify the ballot language in Resolution No. 23-0149, originally adopted on November 7, 2023. This resolution will also modify the ballot question in the Procedures for the Conduct of a Mail Ballot Election relating to a proposed storm drain fee increase, as well as the requirements of the ballot return envelope.
FISCAL IMPLICATIONS:
There are no fiscal implications related to this action.
BACKGROUND:
As City staff has previously informed the public and the City Council, the General Fund provides subsidies to the Stormwater Fund. Finance staff presented a report on Revenue Enhancements to the Finance Subcommittee (FSC) on April 2, 2023. The report identified the Stormwater Fund as an enterprise fund that requires attention. Ideally, enterprise funds should be self-sustaining, with incoming revenues covering outgoing costs. However, the Stormwater Fund has been operating at a deficit for many years and has required over $6 million of General Fund subsidies over the past five years. An additional $11.6 million of General Fund subsidies is projected for the next six years with $8.35 million attributed to capital projects.
The amount of General Fund subsidies projected for the Stormwater Fund continues to increase annually and has the potential to crowd out funding for General Fund services. The transfers out are projected to wipe out the unreserved General Fund balance in the next couple of years. Services funded by the General Fund may be impacted or the City may have to defer capital projects to balance future budget years. During the meeting, the Finance Subcommittee recommended staff move forward to City Council with a consideration for a proposed storm drain fee increase.
On May 16, 2023, staff presented a report to City Council on the status of the Stormwater Fund and its negative effect on the General Fund. The report also highlighted options for proceeding with a process to raise storm drain fees. City Council approved going forward with obtaining an engineer’s report with updated rates and conducting a survey to poll constituent sentiment on a proposed storm drain fee increase.
On September 5, 2023, staff presented a report with an engineer’s report with updated rates along with the results of a survey that measured citizen support for a potential increase to the City’s storm drain fees. City Council approved initiating a Proposition 218 process, authorizing the mailing of protest notices and setting a Public Hearing Date for the proposed storm drain fee for November 7, 2023.
On November 7, 2023, City Council conducted a Public Hearing on the proposed storm drain fee increase. During the meeting, City Council approved Resolution No. 23-0149 confirming that there was no majority protest and calling a special mailed ballot election with ballots due on January 17, 2024.
DISCUSSION:
After confirming there was no majority protest on November 7, the City engaged a communications professional to assist the City in educating the public with impartial factual information about the proposed storm drain fee increase. The professional recommended the following ballot question in order to enhance transparency:
To fund repairs, operations, maintenance, and improvements to the City of Manhattan Beach’s aging storm drain system, including:
• Reconstructing or replacing aging storm drains that are at risk for collapse or failure;
• Installing and maintaining storm drain devices that protect local beaches, waterways, and the ocean from trash and pollution;
• Inspecting and testing storm water quality regularly to ensure clean water standards;
• Removing pollutants, toxic chemicals, and infectious bacteria from runoff; and
• Reducing illegal discharges of pollution in local waterways;
Shall the City of Manhattan Beach’s proposed increase to the existing storm drain fee be approved until repealed by voters, subject to annual adjustments based on the Consumer Price Index, audits, and with all funds dedicated to the Manhattan Beach storm drain system only?
Resolution No. 23-0149 approved election procedures which required a signature line on the return envelope. Since the ballot itself contains a signature line for the voter, the requirement for the return envelope to also have a signature line was removed in the amended election procedures to avoid redundancy and streamline the process.
The mail date was originally scheduled for November 27, 2023, with ballots due on January 17, 2024, which provided a 51-day window to return ballots. With the time the printer needs to set-up the mailing, the ballots are anticipated to be mailed the week of November 27. This new timeframe still allows for at least 45-days between the mailing of the ballots and the ballot deadline. This change does not impact the January 17, 2024, ballot deadline.
Staff recommends City Council adopt Resolution No. 23-0158 to modify the ballot question adopted in Resolution No. 23-0149 and to adopt amended election procedures.
ATTACHMENTS:
1. Resolution No. 23-0158
2. Procedures for the Conduct of a Mail Ballot Election