Folsom City Council Regular Meeting - February 9, 2021
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Folsom City Council Regular Meeting - February 9, 2021
The Folsom City Council held a regular meeting on February 9, 2021, at 6:30 PM in the City Council Chambers. The agenda included a financial report for fiscal year 2020, a follow-up on a residential project in the historic district, a housing element study session, and a discussion on commercial organics recycling compliance. All council members were present: Mayor Mike Kozlowski, Vice Mayor Sarah Aquino, Councilmembers YK Chalamcherla, Kerri Howell, and Rosario Rodriguez.
Consent Calendar
- Items 4 and 5 were approved unanimously (5-0). Item 3 (Resolution No. 10585 with Black & Veatch) was pulled by Mayor Kozlowski due to a recusal (potential client) and then approved 4-0 with the mayor abstaining.
- Consent items included professional services for risk assessment, allocation of Proposition 68 grant match funding, and application for a Caltrans Sustainable Transportation Planning Grant.
Public Comments & Testimony
- Item 2 (908 Bidwell Street): Beth Kelly, President of the Heritage Preservation League, expressed disappointment in staff error leading to unapproved demolition. She recommended hiring a planner with historic preservation expertise and called for robust technical review processes. A letter from resident Bob Delp was read into the record, stating that the unapproved demolition invalidated the basis for granted variances and urging that future non-conforming work be suspended and returned to the Historic District Commission.
- Item 6 (Housing Element): No public speakers were present, but written comments from the Sacramento Housing Alliance and others were acknowledged.
- Item 7 (Organics Recycling): No public comments.
Discussion Items
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City Manager's Financial Report (Item 1): Finance Director Stacey Tamani presented the audited Comprehensive Annual Financial Report (CAFR) for FY2019-20, which received an unmodified opinion with no findings. The general fund unassigned balance fell to $13.8 million (14.4% of expenditures), below the council's 15% policy. For FY2020-21, revenues are projected at $87.6 million, expenditures at $89 million, with a projected deficit of about $400,000 after CARES Act reimbursements. Sales tax and Transient Occupancy Tax are at budget but depressed; parks and recreation fees are down 35%. Enterprise funds for water and wastewater are healthy, but the solid waste fund faces a structural deficit due to unfunded mandates (AB 1826), projected to use over $1 million of reserves annually, leaving working capital well below the recommended $6 million. The risk management fund used $3.5 million of net position to smooth costs but is unsustainable beyond one year. Council discussed budget principles and the need to replenish reserves.
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Follow-Up on 908 Bidwell Street (Item 2): Community Development Director Pam Johns explained that staff erroneously issued a building permit allowing more demolition than the Historic District Commission and City Council had approved (only 120 sq ft rear portion and 81 sq ft accessory structure). Due to building code conflicts, the west and rear walls were demolished, invalidating the three variances granted based on the existing non-conforming structure. Staff apologized and proposed three improvements: early technical review by building plan check staff for historic district projects, modified conditions of approval specifying demolition limits, and improved demolition notes in the electronic permitting system. Councilmember Chalamcherla asked about penalties for future violations; City Manager indicated that red tagging (work stoppage) is used. Council expressed support for the proposed changes and commended staff transparency.
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Housing Element Study Session (Item 6): Consultant Chelsea Payne presented the draft 2021-2029 Housing Element. The city's Regional Housing Needs Allocation (RHNA) is 6,363 units, including 3,500+ for lower-income households. The sites inventory shows capacity for 13,930 units, including projected 194 Accessory Dwelling Units (ADUs) and 387 multigenerational units. The surplus for lower-income sites is only about 500 units, raising concerns about maintaining adequate sites. Key programs discussed: H2 (increase density in East Bidwell Corridor, transit stations, Folsom Plan Area), H4/H5 (ADU design workbook and incentives), H14-H16 (affordable housing on city-owned sites and land trust fund), H29 (homeless services including RT travel vouchers), and H31 (affirmative marketing). Planning commission recommended changes: encouraging rather than requiring marketing, eliminating H29 and H16 (use of housing trust fund for land purchase). Council members provided input: Vice Mayor Aquino supported retaining discretionary hearings, opposed eliminating H29, suggested encouraging not requiring marketing, and emphasized housing for middle-income workers. Mayor Kozlowski questioned measurable goals and suggested removing a program requiring solar on multifamily given SMUD's carbon-free goal. Council approved Resolution 10588 (5-0) authorizing submission of the draft to the Department of Housing and Community Development (HCD) for review.
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Mandatory Commercial Organics Recycling Compliance (Item 7): Public Works Director Dave Nugent reported that the city is out of compliance with AB 1826 because CalRecycle requires 100% participation, but the city only provides education/outreach and lacks enforcement. The city currently contracts with three private haulers for commercial organics collection. Starting in 2022, SB 1383 will mandate residential organics recycling and require enforcement. Staff proposed three options: maintain current contracted haulers, explore franchising (which would require a charter amendment vote), or bring commercial organics in-house alongside the new residential program. Council strongly opposed franchising, citing the city's excellent service and charter restrictions. Council directed staff to not pursue franchising; instead, develop a combined commercial/residential ordinance with incentives rather than penalties (as suggested by the City Attorney), coordinate outreach with the Chamber of Commerce, and bring a draft ordinance for a study session in April 2021.
Key Outcomes
- Consent Calendar: Items 4 and 5 approved 5-0; Item 3 approved 4-0 (Mayor recused).
- Resolution 10588: Approved 5-0 to submit draft Housing Element to HCD for review.
- Organics Recycling Direction: Council directed staff to not pursue franchising; to draft an enforcement ordinance combining commercial (AB 1826) and residential (SB 1383) requirements with incentive-based compliance; and to return with a draft ordinance for a study session in April.
- Historic District Process Improvements: Staff will implement early technical review, modified conditions of approval, and improved demolition notes to prevent recurrence of the 908 Bidwell error.
Meeting Transcript
The meeting of the Folsom City Council for February 9th, 2021. Will the clerk please call the roll? Council members Aquino here. Chalum Charla. Here. Howell? Rodriguez and Kozlowski. Here. If everybody will please stand and join me for the Pledge of Allegiance. The United States of America and Republican for which it stands. One nation on the individual with liberty and justice for all. February, 2021. Just as a reminder to those of you that are on the conference call version of this meeting to please mute your phones. We're getting a little echo after the fact here in the chamber. Are there any agenda updates? Um, yes, Mr. Mayor. Item number six has two updates. Those have been provided to the council and are available to the public on the back table. Fantastic. Okay, um business from the floor, then you currently have no requests to speak under business from the floor. Are there any callers on the line who would wish to speak under business from the floor? This would be items that are not on the council's regular agenda. Okay, hearing none. Let's move on. Okay, we will move to scheduled presentation. Item number one. This is the city manager's financial report, including CAFR findings for fiscal year 2020 and the fiscal year 21 second quarter financial report. Good evening, Mayor, Council members. I'm Stacey Tamani, Finance Director and CFO. Tonight's presentation will be on the results of the audited comprehensive annual financial report. We call that at CAFE, and it's for the year ended June 30th, 2020. During that audit, the city received an unmodified opinion with no findings. That's good news. That's the type of opinion that we're always working to receive. And tonight I'll also be presenting our projections for how we will end this fiscal year based on the results of the first two quarters, July 1st through December 31st. This first slide presents the results of the last two annual audits. On the left, we have fiscal year 1819 in the middle 1920, and then our projections for revenues, expenditures, and fund balance for fiscal year 21. And this is all for the city's general fund. When we look at these results starting with fiscal year 19, this is when we saw an increase in our total fund balance. And that was right here where we had that 2.8 million dollar increase. And that got us that unassigned fund balance of just over 17 million or 20.1%. Now the results for fiscal year 20 are in the middle column. And we used about $5 million of total fund balance, and that brought our unassigned fund balance down to $13.8 million or $14.4%. And that's when you drop below your 15% requirement. This year we're projecting revenues at $87.6 million in total and expenditures at just over $89 million. That's a deficit that we're running, but we are expecting that the CARES reimbursement funding that we brought in this year that was for expenditures last year, is going to help us to only have to use around $400,000 of our total fund balance with some estimated encumbrance changes there on the line below that. And that's $14.7%. The reason that the percentage goes up a little bit is because we're comparing it to a much lower level of expenditures because of the reductions that we made for this fiscal year. And we've worked to replenish this balance up through fiscal year 19.
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