Budget and Government Efficiency Committee Meeting - April 13, 2016
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Budget and Government Efficiency Committee Meeting - April 13, 2016
The Budget and Government Efficiency Committee, chaired by Councilmember Gloria, met on April 13, 2016, with a quorum of Councilmembers Cole, Sherman, Kate, and Gloria. The meeting began with announcements about the FY2017 budget process, including the Mayor's budget release, budget review committee dates, and public input opportunities. The committee then addressed three agenda items: a disparity study recommendation, an appeal of a contractor pre-qualification denial, and a contract increase for parking citation services.
Consent Calendar
- The committee's record of actions from the March 16, 2016 meeting was approved by unanimous consent without discussion.
Public Comments & Testimony
- No public speakers for non-agenda items.
- For Item 1 (disparity study), Rosalind Winstead, a San Diego resident and business owner for 25 years, spoke in support of the Citizens Equal Opportunity Commission's recommendation for a disparity study. She expressed concerns about the city's data tracking, outreach, and the City Attorney's legal memorandum regarding the Commission's composition.
Discussion Items
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Item 1: Citizens Equal Opportunity Commission Recommendation for a Disparity Study
- Laura Warner, Chair of the Commission, presented the recommendation, citing data from the SANDAG 2014 disparity study showing low disparity indices for minority and women-owned businesses (e.g., African Americans at 16, Caucasian women at 49). The city's own data showed 0% contract awards to African American and Native American firms in construction. The Commission recommended a disparity study to set DBE goals, identify disparities, and provide legal framework.
- Councilmember Gloria directed the Independent Budget Analyst (IBA) to provide an overview of other cities' disparity studies and a cost estimate by the first week of May. The motion passed unanimously.
- Discussion included the cost ($1 million+), data issues with SAP and Planet Bids, and the need for qualitative interviews.
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Item 2: Appeal by ACO Engineered Systems Regarding Pre-qualification Denial
- David Stuckey, Public Works Contracts Manager, explained that ACO was denied pre-qualification due to negative net worth ($5.867 million) based on financial statements. Even after removing ESOP-related adjustments, liabilities exceeded assets.
- John Peterson, ACO CFO, argued that the negative equity was due to unearned ESOP shares, a non-cash item, and that the company had positive working capital ($80 million) and bonding capacity ($600 million). He stated that common stock and retained earnings totaled $150 million positive.
- The committee voted unanimously to deny the appeal, noting that ACO could reapply with updated financials or work as a subcontractor. The decision was based on the city's consistent application of pre-qualification rules.
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Item 3: Increase in Parking Citation Services Contract with City of Inglewood
- Deputy Director Didi Alari and Parking Program Manager Jonathan Carey presented the request to increase the not-to-exceed amount from $950,000 to $1,060,000 for FY16 and FY17, due to a 16% increase in citations (55,000 additional citations). The increase is offset by additional parking citation revenue of approximately $720,000.
- The contract processes about 475,000 citations annually, generating $28 million in revenue. The committee approved the increase unanimously.
Key Outcomes
- Motion to direct the IBA to provide a disparity study overview and cost estimate by the first week of May passed unanimously.
- Appeal by ACO Engineered Systems was denied unanimously; the company may reapply or work as a subcontractor.
- Contract increase with the City of Inglewood for parking citation services was approved unanimously.
Meeting Transcript
All right, good morning, ladies and gentlemen. I will call the meeting of the government and I'm sorry, of the budget and government efficiency committee. I'm not on my game this morning. I'm just going to telegraph that right up from the start so you could adjust your expectations accordingly. A quorum is now present consisting of uh council members Cole, Sherman, Kate, and myself. Uh before we begin uh with our business agenda, I want to let the public know about opportunities to weigh in on the city's uh fiscal year 2017 budget, which Mayor Faulkner will release later this week. Uh the council will convene as the budget review committee on May 4th, 5th, 9th, and 10th. We split that up, guys, so just be grateful. Um to review the proposed budget and receive public input on budget priorities and modifications. Uh we'll also hear public input at an evening council meeting at 6 p.m. on Monday, May 16th. The mayor will take the councils and the public's input into consideration uh and issue his May revise uh for the proposed 2017 budget on Tuesday, May 17th, hence May revise. Clever, right? Uh and the May revise will be uh reviewed by the budget review committee on Thursday, May 19th at 2 p.m. Uh City Council members' final 2017 budget priority memor memoranda will be due to the office of the IBA on Friday, May 27th. And final City Council decisions on the 2017 budget will take place at a council hearing currently scheduled for Monday, June 13th. As always, we encourage San Diego's to provide input on the budget at these public hearings and also by contacting your council members directly. Uh so with those introductory comments, and if you want more information, you just call my office, we can explain it to you in more detail. Uh but suffice to say, we're about to get into the thick of it, and if you want to see more road repair, less code compliance, whatever it is, this would be the time to speak or hold your peace. Um so moving right along, uh, the committee's record of actions from the March 16th, 2016 meeting will stand approved by unanimous consent unless pulled for discussion. Any member of the committee wish to pull that item? None? All right, we'll move right along to non-agenda public comment. This is the portion of the agenda that provides an opportunity for members of the public to address the committee on items of interest within the committee's jurisdiction. Comments are limited to two minutes and are not debatable. We have no requests from members of the public to speak at this time. Going going gone. Okay. Um so ask if there's any committee member comment. Ms. Cole. Thank you, Chair. I have to apologize for something I said yesterday. Um it was a number that I skewed out. And I think uh the department has just almost fainted when I did that. It was uh regarding the teen center. Instead of saying 1.5 million dollars to to do the teen center, it was a higher number. Much higher number. It was either wishful thinking, a Freudian slip, uh full paw, but nevertheless, instead of a beautiful number like five million, it is a fabulous number of 1.5 million that they're gonna do for the teen center at the Malcolm X library. So again, I apologize to the mayor's office. I apologize to the staff for five million. Again, it was just wishful thinking on my part. Uh so one point five is a wonderful number. It's going to be a wonderful teen center at the Malcolm X Library. So I just again 3.5, and I'll be my library. So again, thank you for the 1.5 million for the Teen Tech Center at the Malcolm X library. Thank you, Chair. Thank you, Ms. Cole. I just know you have high expectations in your district, and I think that's what you are trying to communicate.
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