Novato City Council Meeting - June 25, 2024

The Novato City Council held a regular meeting on June 25, 2024, at 6:00 PM. Key actions included adopting the FY 2024/25 budget (including a $200,000 parking study), introducing an updated mobilehome rent control ordinance, and ratifying an appointment extension. The council also heard public comments on the city's fiscal sustainability.

Consent Calendar

• Approved routine items, including adoption of updated police department job descriptions, salary schedule, acceptance of Hamilton Village subdivision improvements, GANN appropriations limit ($134,866,120), reciprocal use agreements with Novato Unified School District (NUSD), recreation service contract with North Bay Basketball Academy (up to $180,000 per year), and resolutions for landscape assessment districts (A-81, A-03, C-91, A-91) with public hearings set for July 9, 2024.
• Councilmember Wernick recused from item G.9 (San Marin Landscape Assessment District A-81). The consent calendar passed 4-0-1 (Councilmember Farac absent).

Public Comments & Testimony

• General Public Comment:
  • Paul Shaw (President, Novato Police Officers Association) and Alex Mueller (Board Member, NPOA) expressed deep concern over the city's chronic fiscal deficits and lack of revenue. Both urged the council to bring the sales tax to a full cent to adequately resolve the deficit and maintain services.
  • Bernie Myers (former councilmember) supported a sales tax increase but advocated for guardrails, including a finite duration, supermajority approval for loans/expenditures, timely audits, and sunset provisions. He argued the sales tax is regressive.
  • Fred Reese complained about illegal fireworks on the 4th of July at Hill Recreation Field, urging proactive police enforcement.
• Public Hearing on Mobilehome Rent Control (I.1):
  • Stephen Rosenfeld (Secretary, Los Robles Mobile Home Park HOA) urged adoption of the revised ordinance, thanking staff for collaborative process.
  • John Hansen (President, MVMCC PAC) commended the work but raised concern over defining "fair and reasonable profit" in future disputes.
  • Katie Cartwright (President, Los Robles Mobile Home Park HOA) echoed support and appreciation for the inclusive process.
• Budget Adoption (J.1):
  • Carol Joy Harris thanked the council for including urgently needed maintenance at Marin Valley Mobile Country Club (MVMCC) in the budget and for pursuing exclusive negotiating agreement.
  • John Hansen (MVMCC) asked the council to consider reducing the debt service coverage ratio (DSCR) from 2.0 to 1.5 for the park's loan (remaining $1.4 million), which could free up $300,000 and potentially avoid rent increases. He noted 16% of residents are acutely low-income.

Discussion Items

• Mobilehome Rent Control Ordinance (I.1): City Attorney Gary Bell presented amendments requested at the May 7 meeting: 1) clarifying exemption of leases under state law, and 2) leaving fees for reconsideration petitions as cost-neutral (petitioner pays). Councilmember Eklund asked about renting rooms for financial hardship and 24-hour home care; Bell noted separate rules apply and will review. Councilmember Wernick asked about capital improvement petition fees; Bell said fees could be adopted later by resolution. Council expressed strong approval for the collaborative process, with Mayor Pro Tem O'Connor noting it was "the most synergistic approach" he had seen. The ordinance was introduced on first reading (4-0).
• Budget Adoption (J.1): City Manager Amy Cunningham and Finance Director Carla Carvalho-Degraff presented the FY 2024/25 budget. Highlights:
  • General fund revenues: $50.3 million; expenses: $54.3 million (excluding parking study), resulting in a $4.05 million deficit.
  • General fund reserves projected at $4.7 million by end of FY 2024/25, down from $13.7 million.
  • Staffing: 198 FTEs (down 10.5 from FY 2019/20); salaries/benefits 69% of expenses.
  • One-time funds exhausted; deficits continue for fifth year.
  • Capital Improvement Program (CIP): $4.1 million for ongoing projects, $2 million for three new projects (including electrical switch, ADA clubhouse, clubhouse roof at MVMCC).
  • Parking study: $200,000 proposed; council debated inclusion. Councilmember Eklund preferred to wait for year-end surplus, but the majority supported adding it to the general fund budget to signal priority. Motions passed 4-0 for both City of Novato budget and Novato Public Finance Authority budget.
• Appointment Extension of Dave Dammuller (J.2): Ratified an extension of retired annuitant Dave Dammuller as Special Advisor to the Deputy Public Works Director through December 31, 2024, at $78.11/hour with a 960-hour annual cap. Passed 4-0.

Key Outcomes

• Adopted FY 2024/25 operating and capital budgets for the City of Novato and the Novato Public Finance Authority, including $200,000 for a downtown parking study (4-0 votes).
• Introduced an ordinance amending mobilehome rent control (Chapter XX of Novato Municipal Code) on first reading (4-0). Second reading and possible adoption will occur at a subsequent meeting.
• Ratified the appointment extension of Dave Dammuller as a retired annuitant (4-0).
• Set public hearings for July 9, 2024, to: (1) confirm landscape assessment levies for four districts, (2) receive survey results on a potential sales tax measure, and (3) review the five-year general fund forecast and pavement condition index.
• City Manager advised that the emergency reserve will be insufficient to maintain services into FY 2026/27 without new revenue, and discussions on a sales tax measure will begin July 9.