Huntington Beach City Council Meeting June 26, 2023: Budget Adoption and Police Management MOU
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Huntington Beach City Council/Public Financing Authority Adjourned Regular Meeting – June 26, 2023
On Monday, June 26, 2023, the Huntington Beach City Council/Public Financing Authority convened an adjourned regular meeting at 5:00 PM in Council Chambers, recessed to closed session, and reconvened at 6:00 PM. The council adopted the FY 2023/24 budget, approved a new Police Management Association (PMA) MOU, and made several other decisions. Closed session involved existing litigation (Clayton-Tarvin v. City of Huntington Beach); no report was given.
Consent Calendar
- Adopted Resolution No. 2023-33 appointing Mark D. Alvarado as Interim Chief Financial Officer and approving his employment agreement. The consent calendar passed 7-0.
Public Comments & Testimony
- More than 50 public speakers addressed the council, most focusing on the FY 2023/24 budget. Many speakers expressed relief that library closures and reduced library hours had been removed from the revised budget plan, and urged the council to permanently protect libraries.
- Several speakers supported the Circuit ride-sharing service, citing its ridership (over 165,000 trips), reduction of vehicle miles (274,000), gasoline savings (17,000 gallons), and user rating (4.96/5). They asked the council to continue funding it.
- Multiple speakers opposed the proposed expansion of the city attorney’s office (four new positions) and criticized the office’s budget increase while other departments faced cuts. A few speakers challenged the city attorney’s argument that in-house legal work has no marginal cost.
- Several speakers raised concerns about the air show settlement, including the $7 million payout (though one council member later stated the actual figure was $4.9 million with $1.9 million paid this year) and the separate $550,000 CEQA environmental review cost, questioning transparency and the use of public funds.
- Some speakers criticized the last-minute distribution of a revised budget on the night of the meeting, calling it unprofessional and a disservice to transparency, while a few appreciated the council’s response to community input.
- A smaller number of speakers voiced support for the council majority and the budget process, commending staff for their work in difficult circumstances.
Discussion Items
- FY 2023/24 Budget (Public Hearing Item 23-5663): Staff presented a structurally balanced General Fund budget of $283.1 million with a planned surplus of $1.7 million. The budget included the use of $4.9 million in AES reserves, $3.9 million in equipment replacement reserves, a return to a 12-year paving cycle, adoption of the Gann Appropriation Limit ($1,171,687,773), a retirement property tax levy, classification plan amendments (Graphic Designer, Multimedia Coordinator, Homeless Services Manager, Municipal Records Manager), a revised reserve policy, the fire inspection report, contract approvals (Mind OC, NDC, Hinderliter), and a budget balancing plan to address projected FY 2024/25 deficits. The revised plan presented at the meeting eliminated most proposed service cuts (including libraries and downtown maintenance) and achieved $7,039,530 in ongoing savings, reducing the projected FY 2024/25 deficit from $7.4 million to approximately $400,000. The original motion to adopt the budget as revised passed 7-0. A substitute motion by Councilmember Kalmick (to adopt the earlier June 6 budget with only revenue-raising items and to remove city attorney positions) failed on a 3-4 vote.
- Police Management Association MOU (Item 23-5684): The council approved Resolution No. 2023-32 implementing a three-year PMA MOU (July 1, 2023 – June 30, 2026) with 5% wage increases each year, adjustments to pay programs, and increased health benefit contributions. The fiscal impact over three years is $1.2 million. The resolution passed 7-0.
Key Outcomes
- Adopted Resolution No. 2023-33 (Interim CFO appointment) – approved 7-0.
- Adopted the FY 2023/24 budget, including the revised budget balancing plan and related resolutions – approved 7-0.
- Defeated substitute motion to adopt the earlier budget version without certain reductions and without city attorney position increases – failed 3-4 (Kalmick, Moser, Bolton in favor; Strickland, Van Der Mark, McKeon, Burns opposed).
- Approved Resolution No. 2023-32 (PMA MOU) – approved 7-0.
- The next regular meeting is scheduled for July 18, 2023; the July 5, 2023 meeting was cancelled due to lack of quorum.
Meeting Transcript
I'd like to call uh order uh uh to the regular meeting of the city council public finance authority. Uh clerk, please call the roll. Councilmember Kalmick here. Councilmember Mosier. Here. Mayor Pro Tem Vandermark. Here. Mayor Strickland. Here. Councilmember McKeon. Here. Councilmember Bolton. Here. Councilmember Burns. Here. All present. Thank you. Uh now, members going down to the agenda. We have uh council comments. Is any councilman have a comment? I would. Mr. Councilman McKinnon. Thank you. Yeah, I just want to thank the community for their patience while we work through the critical budget process. I've seen some comments in the community that we, the new elected council members are responsible for the the forecasted budget deficits in the coming years. And nothing could be further from the truth. We have been on the job six months and are not responsible for the actions of the previous city councils and previous city managers' decisions that have led us to this point. They went on a three-year taxpayer spending spree. They created a bloated and unnecessary homelessness administration and public health department. That is the responsibility of the county. They allowed the Elon and Breakwater properties to be purchased for quote workforce housing, whereby the city foregoes five hundred thousand dollars per year in property tax for the next thirty years, big pay increases during COVID, etc. The only reason they showed a surplus was the one-time COVID funds, which are now gone. Our budget is structurally balanced this year for fiscal year 2324, but the actions of the past councils have left us with an untenable financial situation in the coming budget years beyond 2324. You hear the analogy all the time on the federal level about kicking the can down the road. Well, we are at the end of the road. It was also important that we gave our police department the tools they need to be able to recruit officers to fill our 30 police officer vacancies. The national sentiment that has been created of defund the police and vilifying police officers has created an arms race with other cities that have been given large pay raises in order to recruit a diminishing talent pool of police officers. Public safety is the number one role of government. Everything flows off of having strong public safety. It allows our businesses to be successful and our citizens to be safe, which creates prosperity and a high quality of life. We need to run this city like a business where we maximize and harness our assets to increase revenue and trim our expenses where we can to cut wasteful spending. We directed the department heads, as they know best, to come up with options to create revenues and trim expenses, which is what you see in the budget balancing plan. Not every option will be implemented, but it was important to understand all of the options that are available. We appreciate everyone's patience, and please know that this will be an ongoing continual process where we seek to find efficiencies every day moving forward so that we can make adjustments throughout the year by being fluent and flexible with course corrections if determined to be beneficial. And lastly, Mayor, I just want to apologize to the community on behalf of the city council. As for the second week in a row, our colleague, Councilmember Calmick, has sent out a campaign email filled with lies, smears, misrepresentations, and miserable. Again, um everybody you all have three minutes to speak, and we'll be very respectful to each and every one of you on that three minutes. Uh please be just as respectful to each and every event whether you agree or disagree, be respectful to all the council members in their comments, please. Thank you.
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