HomeMy WebLinkAbout2001 - MINUTES - 1/31/2001 - STUDY SESSIONSTUDY SESSION
CITY OF PALM SPRINGS
JANUARY 31, 2001
CONVENE IN OPEN SESSION
A. Call Back to Order-Large Conference Room
B. Flag Salute
C. City Attorney Report on Matters Discussed in Closed Session-See Page 2 of
Agenda this date.
D. Public Comments
James Drum, resident, stated that the MVP has changed the residential
neighborhood around the DeMuth Park area; that traffic has increased; that all
the homes shake; that commercial traffic should be prohibited; and
recommended that the school bus boarding stop be at the Youth Center.
Wendy Busig-Kohn, reviewed a handout, copy attached.
E. COUNCIL COMMENTS/QUESTIONS/REPORTS
Councilmembers commented on various civic functions attended.
Councilmember Hodges stated that PM10 is becoming an issue in the Valley and
must be addressed before all construction is affected.
Mayor reviewed awards presented by the PSDRCVB, copy attached.
F. CITY MANAGER COMMENTS – None
G. STUDY SESSION
1. WASTEWATER TREATMENT PLAN RATE MAKING METHODOLOGY
Assistant City Manager-Operations reviewed a power point presentation, copy
attached.
City Attorney stated that there had been some controversy over regarding rates;
that staff has reviewed the rates that are in place for the City; that the rates
reveal winners and losers; that some rates will go up, while other will go down;
that the new methodology will set in place a user fee system; that the fees will
represent the service provided; and that this will fulfill the requirements of Prop
218.
2. QUARTERLY BUDGET REVIEW
Finance Director reviewed a power point presentation, copy attached; and added
that the sewer rates in the City of Palm Springs are at least 30% lower than the
rest of the Valley; and in answer to questions by Council stated that the fire
department is running over the budgeted amount in overtime costs; that the
overtime is the result of retirements, minimum manning and contractual
obligations; that the paramedic program did impact the fire department budget;
and that in the next year budget much of the overtime will be accounted for as
discretionary; that the minimum manning is now set at 17; that the TOT is not
progressing as well as last year and that the projects are for March to be flat with
no increase; that sales tax is up 6% due to car sales; that in response to Council
request a TOT monthly report will be given to Council with comparisons of other
Valley Cities; that some of the parades could be marketed in packages; that the
APOA conference did show a sharp spike for increased TOT; that there was a
bump in November 1998-99; that research will be done and the results reported
to Council with what was the differing factor; and that ERAF funding will again be
present for budget calculations.
ENERGY ISSUES
Mayor questioned if SCE was continuing to pay the UUT; and if there would be
penalty if it were not paid.
Director of Finance stated that the UUT is being paid and there is no ramification
is it is not paid by the Utility.
Procurement Manager stated that the price for gas did spike in higher rates; that
the rates were not projected; that normally the trend is for natural gas rates to be
higher in the winter months, then drop off; that with the current increases due to
the adjustable rates, the City has no control; that staff is proposing a long term
agreement to purchase natural gas; that the agreement will safeguard against
the volatile market; that once the agreement is in place the rates will be locked in;
and that the option could be for 12 or 24 months.
Assistant City Manager stated that Cogen is being impacted to a great extent;
that the plants are in good working order; that they were doing a good job until
the rates of natural gas went up; that it is now costing the City to produce
electricity to sell to SCE; that if the price can be lowered the sales may break
even; that there are regulations in place to operate the plants; that if the plants
are shut down, it will cost millions to restart; and that hopefully if the rates of
natural gas can be maintained the cogen plants can operate efficiently.
Mayor questioned if SCE is paying for the electricity generated.
Director of Facilities stated that the bills are being paid; that the last payment
received was in December, and that January has not yet been paid, or would it
be paid before this time.
Assistant City Manager stated that if the payments are not made by SCE there
might be a way out of the agreements.
Mayor stated that staff should investigate what other Cities are doing for long-
term contracts.
Economic Development Director stated that the energy crisis is affecting
business retention, expansion and recruitment; that if the energy can not be kept
up, there will be an impact with the hotels; that there were site visits last week
with the larger hotels for energy consulting; that New West Energy did take part;
that the hotels are very concerned with the availability of electricity and the fines
they will get if they use during restricted periods; that options were put on the
table; that work will continue with the hotels; that the there is some concern of
shut downs and of corporations moving out of state; that the impacts are
immeasurable; that the State must get a reliable power source; that other States
have already started to lure businesses away from California; and that experts
such as Coast Intelligen and New West Energy are needed to work with the City
for possible solutions.
Procurement Manager stated that on February 21, 2001 Council will be asked to
consider entering into an energy advisory agreement with New West Energy,
copy of report attached.
Economic Development Director stated that the I-6 customers are not longer
being required to curtail power or be fined; that it is not clear if the fines will be
waived retroactively; but that the issue of power is not resolved.
Mayor stated that the bottom line is that there is not enough power; that there
may be rolling blackouts to communities; that this is stressful for the residents
and bad for tourism; that everyone is a possible target for a blackout; that even
with the I-6 waiver, tourism is at risk.
Procurement Manager stated that those businesses and schools on the I-6
program will still get calls to “power down”; that there will be no fines levied, but
that the requests will be made.
Mayor stated that consistent power is needed by the State; that the issue impacts
everyone in the State; that it may be wise to partner up with an energy
consultant; that there were blackouts 2 or 3 years ago that resulted in vandalism;
that the recent blackouts were handled well by the public; that the pavilion and
the desert highland center are equipped with generators incase citizens need
someplace to go that will have power and that hopefully a solution will be found
before the summer months.
ADJOURN