Huntington Beach City Council & Public Finance Authority Meeting - February 4, 2025

The Huntington Beach City Council and Public Financing Authority met in regular session on February 4, 2025. The meeting included a closed session on labor negotiations, public comments on library petitions and other topics, a detailed financial forecast presentation, and a public hearing on a proposed tax-exempt bond issuance for a senior living project. Key outcomes included approval of the consent calendar, approval of a visitor kiosk agreement, and continuation of the TEFRA public hearing to February 18, 2025.

Consent Calendar

• The consent calendar (items 10, 12, 13, 14) was approved unanimously (7-0) without discussion after item 11 was pulled for separate action.

Public Comments & Testimony

• Regina Blakenhorn criticized the city for using resources to survey petition signers, stating it was an insult to the 17,000 voters who signed. She argued the city's actions mirror tricks used by Measure U proponents.
• Barbara Richardson objected to the city's survey about library petitions, asserting that a politically appointed review committee would effectively ban books. She urged the council to let residents vote.
• Andy Aynhorn condemned the release of January 6 insurrectionists, called for an end to the "MAGA culture war," and asked how the city would verify responses to its survey of petition signers.
• Tim Gaddis accused the council of disrespecting the democratic process by stalling the library petitions and urged immediate action.
• Mr. Amory Hanson spoke in support of renewing the agreement with Visit Huntington Beach for a visitor kiosk (item 11), praising its informational screen.
• Kenny Noah highlighted the city's $1.825 billion infrastructure deficit over 15 years, calling it a financial and public safety crisis. He proposed an independent ad hoc committee to monitor infrastructure spending.
• Jaden supported the non-sanctuary city declaration, arguing sanctuary policies protect criminals, disrespect legal immigrants, and cost taxpayers $23 billion annually in California.
• Charlie Jackson expressed that the council claims to be business-friendly but focuses on political issues over potholes and budgets. He supported the proposed senior living project (ISOR), noting it would provide needed facilities and $8 million in revenue.
• Paula Schaefer corrected the record on a prior incident: police were called only after a person shouting at petition signers refused to stop despite library security intervention. She denied that circulators lied, as petition text was available.
• David Reinerson accused the council of using a survey to distract from the real issue: the city's financial plan shows deficits through 2033 and underfunds equipment replacement, infrastructure, and emergency services.
• Chris Renee questioned the city's survey methodology, criticized Councilmember Vandermark for wearing disguises to sign the survey, and noted that the budget deficit is a more pressing issue than library changes.
• Justine Makoff promoted events at the Huntington Central Park Equestrian Center and urged protection of the library, noting it costs $6 million annually compared to $100 million for police.
• Elise Tobert shared her personal story as a homeless newcomer to Huntington Beach, thanking the city for its kindness and offering to volunteer.
• Valentina Bankhead voiced full support for the council's conservative stance on non-sanctuary city and library issues, stating that petition signers were lied to and that the council is protecting the community.

Discussion Items

• Financial Forecast Presentation: Interim CFO David Kane introduced Urban Futures (UFI) consultant Jim Morris to present the city's long-range financial plan. The baseline forecast, using 10 years of historical data and Moody's economic projections, shows annual operating deficits starting in FY26, reaching a cumulative deficit of about $50 million by 2032, before an inflection point in 2033 where revenues outgrow expenses. Fund balance would dip into committed reserves (economic contingency reserve) to cover deficits. Key items not included in the baseline: underfunding of equipment replacement, critical infrastructure (graded D needing $1.163B), departmental cuts restoration, and risks to EMS revenue. A scenario forecast modeling use of ROPS waterfront one-time revenues and a proactive UAL management strategy (e.g., using pension 115 trust funds to offset increased CalPERS costs) reduced cumulative deficits by about half and preserved fund balance at near 30% of expenses. Council members discussed revenue opportunities (events, short-term rentals, lease reviews) and expense reductions (B Well program at $1.5M and navigation center at $2M). Two town halls were announced: February 24 at City Hall and March 12 at the library, both at 5 p.m., to gather community input on budget priorities.
• Item 11 – Visit Huntington Beach Visitor Kiosk Agreement: Councilman Twine asked about a large digital display next to the kiosk. Community Services Director clarified it is part of the wayfinding program, not advertising. The sign code prohibits off-site advertising; changes would require council direction. The item passed 7-0.
• Public Hearing – TEFRA Bonds for Senior Living Project (Item 15): Interim CFO David Kane presented a resolution authorizing the California Public Financing Authority (Cal PFA) to issue up to $325 million in tax-exempt bonds for Marisol LLC to develop a 214-unit assisted living and memory care facility (initially entitled in 2020 with 226 units). The city holds a public hearing under TEFRA but incurs no liability. The developer will enter a Payment in Lieu of Taxes (PILOT) agreement to make the city whole for property taxes. Councilman McKeon asked about the bond ceiling and requested a personal guarantee of PILOT payments in case of default; developer representative said that would not be agreeable. Mayor Burns asserted the city is the sole geographic jurisdiction for approval; developer counsel later indicated alternatives existed but they chose to work with the city. One public speaker (Charlie Jackson) questioned why this project doesn't require a vote under Measure U. Councilman Burns clarified Measure U applies only to city-initiated zone changes with significant environmental impacts, not this project. Councilman Kennedy noted the downsides of PILOT agreements do not apply because this PILOT is equivalent to full property tax. The public hearing was continued to February 18, 2025.

Key Outcomes

• Consent calendar (items 10, 12, 13, 14) approved 7-0.
• Item 11 (Visit Huntington Beach kiosk agreement) approved 7-0.
• TEFRA public hearing on Marisol LLC senior living project opened, public comment heard, and continued to February 18, 2025, for final action.
• Financial forecast presented; council directed staff to continue budget development with a focus on near-term deficits, potential revenue enhancements, and expense reductions.
• Two town hall meetings scheduled: February 24 at City Hall and March 12 at the library, both 5 p.m., for community input on budget priorities.
• Council committee appointments made: Tisha Husseini to Community & Library Services, Laszlo Locke to Public Works, Alan Schreiber to Investment Advisory Commission, and Mel Williams to Harbor Commission.