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1997-08-19 Regular CC MinutesREGULAR MEETING OF THE CITY COUNCIL TUESDAY- - -AUGUST 19, 1997- - -7:30 P.M. Mayor Appezzato convened the meeting at 7:40 p.m. (97-456) Mayor Appezzato announced that he would be leaving the meeting early and Vice Mayor DeWitt would preside over the meeting after the Special Orders of the Day. Mayor Appezzato held a Ribbon Cutting Ceremony in recognition of the beautiful new City Council Chambers; he invited Councilmembers and former City officials seated in the audience to participate. Former Mayors Raymond Kranelly and William McCall, Sr., former Vice Mayor Lil Arnerich, and former Councilmember Mark Hanna joined the Mayor and Council. The Pledge of Allegiance was led by Vice Mayor DeWitt. The Invocation was given by Pastor Don Taylor, Central Baptist Church. Roll Call: Present: Councilmembers Daysog, DeWitt, Kerr, Lucas and Mayor Appezzato. - 5. [Note: Mayor Appezzato left the meeting after Special Orders of Day.] Absent: None. PROCLAMATIONS AND SPECIAL ORDERS OF THE DAY (97-456A) Video Presentation: West End Revitalization. [5 Minutes] Following the video presentation on the West End, Mayor Appezzato reviewed recent City accomplishments and projects, and stated things were going very well in the community. (97-457) Norma Arnerich, Alameda, invited the City Council to the dedication of the Norma Arnerich Teaching Academy at the Chuck Corica Golf Course Complex on September 12, 1997. CONSENT CALENDAR Mayor Appezzato announced that the report on the Midway Shelter Regular Meeting Alameda City Council August 19, 1997 281 Operations [Paragraph No. 97-460] and the Report on Mastick Senior Center [Paragraph No. 97-462] had been removed from the Consent Calendar for discussion. Councilmember Kerr moved approval of the remainder of the Consent Calendar. [Items so approved are indicated by an asterisk preceding paragraph numbers.] Councilmember Lucas seconded the motion, which carried by unanimous voice vote - 4. [Absent: Mayor Appezzato - 1.] (*97-458) Minutes of the Special City Council Meeting held on July 29, 1997 and the Regular City Council Meeting held on August 5, 1997. Approved. (*97-459) Report from Mayor Appezzato regarding Committee to replace City Hall Tower with private funds. Accepted. (97-460) Report from Community Development Director recommending authorization to execute FY 1997-98 CDBG Grant Agreement with Human Outreach Agency for Midway Shelter Operations. Neil Patrick Sweeney, Alameda, spoke in support of the staff recommendation. Don Bergen, Alameda, stated there are few Alamedans at the Midway Shelter and that he opposed the staff recommendation. Tony DeSimone, Mayor's Fundraising Committee for the Homeless, stated the Midway Shelter provides a very valuable service and helps people find their way. Ginny Krutilek, Alameda Homeless Network, stated most of the people who have been housed at the Midway Shelter have been single parents with children, and that the Shelter has done a wonderful job. Jim Franz, Alameda, stated families often become homeless because of a crisis, and that short term assistance can help them get back into their homes. Gerhard Degemann, Alameda, stated people who are homeless deserve help to become productive citizens of society. Don Roberts, Alameda, stated San Leandro received $1.7 Million in federal funds for the motel at the Naval Air Station, in order to provide fifty-four housing units; San Leandro will not be able to deny admission to Alamedans; the Midway Shelter should be phased out at some point; and Alameda's homeless should be allowed to live in the kind of housing San Leandro will provide on the Base. Vice Mayor DeWitt stated the City should review Mr. Robert's Regular Meeting Alameda City Council August 19, 1997 suggestion. Councilmember Kerr stated it is important to note that the Grant Agreement is for one year; Alameda is undergoing base conversion and short of money; and Council should review the entire matter .-axt year again. Councilmember Lucas stated the program should be re-evaluated next year, and better facilities and training could be provided perhaps. Councilmember Lucas moved approval of the staff recommendation. Councilmember Daysog seconded the motion. In response to Councilmember Daysog's inquiry regarding finances, the Community Development Director stated there were several different approaches: there would be 20 to 24 people at the Shelter versus 30, longer stays, and the Human Outreach Agency would be raising funds to expand services. On the call for the question, the motion carried by unanimous voice vote - 4. [Absent: Mayor Appezzato - 1.] (*97-461) Report from Public Works Director recommending Council oppose the Professional Engineers in California Government (PECG) Initiative, SB479 and AB376. Accepted. (97-462) Report from Public Works Director recommending award of contract in the amount of $641,300 to Golden Bay Construction for Mastick Senior Center Accessibility Improvements Project, No. P.W. 01-97-01. Neil Patrick Sweeney, Alameda, discussed the use of Irrevocable Living Trusts for the purpose of raising funds. Councilmember Lucas moved approval of the staff recommendation. Councilmember Daysog seconded the motion, which carried by unanimous voice vote - 4. [Absent: Mayor Appezzato - 1.] (*97-463) Report from Public Works Director recommending award of contract in the amount of $247,700 to Steiney Electric for Park Street Signal Coordination, Phase 2, No. P.W. 05-97-11. Accepted. (*97-464) Resolution No. 12916, "Rejecting all Bids and Authorizing Public Works Director to Negotiate and Execute an Open Market Contract Pursuant to Charter Section 3-15 for Minor Street Patching with Asphalt Concrete." (Requires Four Affirmative Votes) Adopted. (*97-465) Ratified bills in the amount of $2,323,159.53. Regular Meeting Alameda City Council August 19, 1997 REGULAR AGENDA ITEMS (97-466) Resolution No. 12917, "Appointing Danielle A. Bailey as a Member of the City Social Service Human Relations Board." Adopted. Councilmember Lucas moved adoption of the Resolution. Councilmember Kerr seconded the motion, which carried by unanimous voice vote - 4. [Absent: Mayor Appezzato- 1.] (97-467) Public Hearing to consider Parcel Map, PM-7150, to divide a 39,550 square foot lot, which contains two office buildings, into two parcels, with each parcel containing a commercial building. The proposal includes a condition that the Applicant prepare an agreement to establish shared parking on Tynan Avenue prior to recording the parcel map. The property is located at 2100/2150 Mariner Square Drive. Applicant: John Beery for Mariner Development Company; and Resolution No. 12918, "Approving Parcel Map, PM-7150, at 2100/2150 Mariner Square Drive, for Mariner Development Company." Adopted. Neil P. Sweeney, Alameda, urged the City Council to approve the Parcel Map. Councilmember Kerr requested clarification on the matter of parking spaces. The Planning Director responded the existing off-site parking spaces are located within the rail right-of-way and have leases; there are conditions that require the developer to record an easement on adjacent property across the street should any of the 26 spaces fall out of lease agreement. Councilmember Lucas stated the matter was approved by the Planning Board, and that she supports the Board's decision. Councilmember Lucas moved that Council close the public portion of the Hearing and approve the Parcel Map, based upon the findings and conditions contained in the Draft Resolution. Councilmember Kerr seconded the motion. The motion carried by unanimous voice vote - 4. [Absent: Mayor Appezzato - 1.] (97-468) Public Hearing to consider an Appeal by Edward J. Murphy of the Planning Board's Decision (ZC-97-5) regarding re-development of properties located at 2607 Santa Clara Avenue, 1500 and 1506 Broadway Street, Alameda. Applicant/Appellant: Edward J. Murphy; and Regular Meeting Alameda City Council August 19, 1997 Resolution No. 12919, "Upholding the Planning Board's Decision (ZC- 97-5) Regarding Properties Located at 2607 Santa Clara Avenue, 1500 and 1506 Broadway Street, Alameda." Adopted. The public portion of the Hearing was opened. Speakers Edward Murphy stated that his comments would apply to both Hearings [Paragraph Numbers 97 -468 and 97 -469]; the record pertaining to both Appeals is before the City Council; the record is lengthy, contains all the matters at issue and clear; there is no purpose to be served by reiterating the matters at this; and he will await the decision of the Council, unless there are questions. Public portion of the Hearing was closed. Councilmember Lucas stated that the Planning Board voted on the issue; the vote was unanimous; and that she supports the decision of the Planning Board. Councilmember Lucas moved that Council uphold the Planning Board's decision by adopting the Resolution. Councilmember Kerr seconded the motion. On the call for the question, the motion carried by unanimous voice vote - 4. [Absent: Mayor Appezzato - 1.] (97 -469) Public Hearing to consider three Appeals by Edward J. Murphy of the Planning Board's Decisions (ZC -97 -7, ZC -97 -8, and ZC- 97-9) regarding re- development of properties located at 2607 Santa Clara Avenue, 1500 and 1506 Broadway Street, Alameda. Applicant /Appellant: Edward J. Murphy; and Resolution No. 12920, "Upholding the Planning Board's Decisions (ZC -97 -7, ZC -97 -8, and ZC -97 -9) Regarding Properties Located at 2607 Santa Clara Avenue, 1500 and 1506 Broadway Street, Alameda." Adopted. Public portion of the Hearing was opened. Speakers Edward Murphy [see comments under previous Hearing on ZC- 97 -5]. Public portion of the Hearing was closed. Councilmember Kerr moved that Council uphold the Planning Board's decision and adopt the Resolution. Regular Meeting Alameda City Council August 19, 1997 Councilmember Lucas seconded the motion, which carried by unanimous voice vote - 4. [Absent: Mayor Appezzato - 1.] (97-470) Public Hearing to consider a Proposed Negative Declaration of Environmental Impact, IS-96-14, for the temporary relocation of the Alameda Main Library to the West Wing of the Central Building of the Historic Alameda High School, 2200 Central Avenue. The proposal is to move the library for approximately five years, to allow seismic upgrading of the Carnegie Library Building; and Resolution No. 12921, "Approving a Negative Declaration, IS-96-14, for the Temporary Relocation of the Alameda Main Library to the West Wing of the Central Building of the Historic Alameda High School." Adopted. Public portion of the Hearing was opened. There being no speakers, the public portion of the Hearing was closed. Councilmember Daysog moved acceptance of the report and adoption of the Resolution approving the Negative Declaration, IS-96-14. Councilmember Lucas seconded the motion, which carried by unanimous voice vote - 4. [Absent: Mayor Appezzato - 1.] (97-471) Report from the Public Utilities Board regarding the Telecommunications Business Plan and recommending that the Board control and manage Telecommunications; and Report from Acting General Manager regarding Telecommunications Activities of the Bureau of Electricity. Ken Hansen, Chair, Public Utilities Board, stated telecommunications is an exciting new concept for the Bureau; the Bureau is capable of performing said operations on behalf of the citizens; the Bureau provided approximately $3 Million annually to the General Fund from earned income; and the departure of the Navy requires new ideas to replace losses, and the Board urges the Council to support the concept of the Bureau entering into a new business: telecommunications. Diane Coler-Dark, Alameda, stated Council was being requested to approve the Bureau going into telecommunications before the Court validation. Don Roberts, Alameda, stated the Bureau has spent over $400,000 for telecommunication activities; based upon Section 12-5 of the City Charter, the City does not have the authority to delegate [authority for telecommunications] to the Bureau; cable television and fiber optics cable are new businesses which require voter Regular Meeting Alameda City Council August 19, 1997 286 approval; for the Telecommunications Act to preempt the City Charter, it will have to mandate every public and private utility to go into telecommunications; and that he urges the City Council to defer action and direct the Board to stop spending money [on telecommunications] until a Judge has ruled on the City Attorney's opinion, or the people vote on the matter. Richard Sussman, Alameda, praised the Bureau for its innovative and forward thinking. He stated the Bureau should study a variety of consumer and industrial fiber technology applications, including how the proposal would affect the average Alamedan. At the request of Vice Mayor DeWitt, the City Attorney addressed certain concerns expressed by the speakers. The City Attorney stated Council previously directed that a validation action be filed with the Court; a validation action was filed in April, 1997; the Bureau has been proceeding to go out to bid to get a contract to present to the Judge; the contract to be validated did not have any bidders, so the Bureau is going out with a new proposal; a validation action is expected to be filed within the next month or two; the action tonight is subject to the validation proce?Aing; and tonight the Council is deciding on whether to delegate authority for telecommunications to the Bureau and on a business plan. The City Attorney further explained telecommunications is a public utility business serving an end-user; and that leasing out excess space in fiber optic cable is considered incidental to existing electric utility business and is not a separate public utility business. In response to Councilmember Daysog's inquiry regarding fiber optics, the Acting General Manager, Bureau of Electricity, stated the use of fiber optics in command and control in electric utilities is quite common; that because of the unreliability of the current provider, the Bureau has been investigating, since 1995, the installation of fiber optics as a means of command and control; the lease of dark fiber is clearly within the purview of existing businesses, e.g. the Bureau selling space on poles and in the conduits for other utility providers; and that the Bureau is not serving an end-user itself, it is leasing space to a third party vendor. In response to Councilmember Lucas's inquiry regarding the legal question concerning preemption of the City Charter, the City Attorney stated the Telecommunications Act of 1996 is a federal law and applies nationwide; that in her opinion that law preempts the City Charter; that she issued an Opinion in February, 1996; since the City is dealing with a new law and a significant investment of money, she had recommended that her Opinion be subject to a Validation Action; the Validation Action is a conservative action: the City would be suing itself to find out if the Opinion is correct; that she conferred with numerous attorneys specializing in Regular Meeting Alameda City Council August 19, 1997 7 the area, there are 75 other municipalities going into the telecommunications business, the FCC issued a number of preemptive decisions and has been aggressive in interpreting the Telecommunications Act; and that she believes the Court will uphold the action. Councilmember Kerr stated that she understood the Validation Action had not yet been initiated, to which the City Attorney responded in the affirmative. Councilmember Kerr further stated the Business Plan was comprehensive and thorough, however, information on: 1) whether there are any commercial lenders to loan $8 Million, 2) the net worth of the Bureau, and 3) the market value of the Bureau's share of NPCA should be provided; the question why Pacific Bell and others abandoned installing fiber optic should be answered; deregulation is a serious set back for Alameda and will not save the ratepayer any money; that she would support the Bureau going into the telecommunications business, or other appropriate business(s), if non-City capital could be found; the proposed company should have a legal structure to protect the City, Bureau and others if the proposed company goes bankrupt; and the matter should have been placed on the ballot. In response to Councilmember Kerr's inquiry regarding existing cable, the Acting General Manager stated that approximately $50,000 per year of lease revenues would be coming in over the next five years, which would pay for the installation of much of the existing system. In conjunction with the Acting General Manager's comments, the Assistant General Manager of Operations [Mr. Hubbard] stated the Bureau is receiving approximately $65,000 per year; the Bureau has a lease for 10 years, which is renewable; within a six-year period, the Bureau will have paid for all of the cable in the ground; the Bureau is receiving $85 per fiber per mile; the lease is with ICG Access for eight fibers. Councilmember Kerr inquired whether a survey was conducted of high tech companies regarding usage of the facility, to which the Assistant General Manager of Operations responded that the Bureau met with a number of the high tech companies. In response to Councilmember Kerr's inquiry regarding floating the $8 Million loan, the Acting General Manager stated that she spoke with two underwriters who indicated they would be looking at the legal ramifications--the delegation/Validation question; both underwriters believe they could do it; the availability of the reserves being set aside to meet competitive needs and the cost of outside capital should be compared, and the least risky way of generating funds to start the new business considered; and that the Regular Meeting Alameda City Ccuncil August 19, 1997 286 Plan recommends borrowing from the reserves at commercial rates. In response to Councilmember Daysog, the Acting General Manager stated over the past ten years the Bureau's transfer to the City [General Fund] has been as high as $3.6 Million, and that this year the transfer is $2.8 Million. Councilmember Daysog questioned whether deregulation and competition could lower the amount of the transfer, to which the Acting General Manager responded there could be a possibility; that it currently depends on a competitive difference between the Bureau and PG&E, which will substantially change. Councilmember Daysog stated that if nothing is done, there is the risk of the market forces driving the Bureau out of business. The Acting General Manager stated if the competitive electric utility industry is looked at as it will emerge in January, 1998, it will show that the monolithic holding companies of the past are separating into the generating business, transmission business and wires [delivery] b,siness; the delivery of service is the bottom line; to that extent, the Bureau is in good shape; the Bureau has an excellent distribution system and one that is extremely reliable and is operated in a reliable manner; the Bureau can divest itself from unnecessary generation and the small amount of transmission outside of the City limits, and may be in a good position to continue its service to the community and be the pass-through utility for all the energy providers who want to sell to other entities in Alameda; and that her belief is that the Bureau has a good solid basis for continuation into the future; and the Bureau cannot continue to transfer $3 Million dollars a year to the City unless it does something to augment what it is currently doing. Councilmember Kerr noted at a recent Special Council Meeting a speaker from the NPCA discussed the different treatment the State was giving to investor-owned utilites and to municipal utilities on recovering stranded costs; that the speaker advised municipal utilities to recover costs at an accelerated rate if necessary, in order to be competitive with the investor-owned utilities by 2002; stated that she wondered if the Bureau could recover stranded costs by the year 2002 and also contribute $3 Million to the City's General Fund. The Acting General Manager responded that her guess would be no; she stated the Bureau is beginning the process of updating its Business Plan, which will include forecasts for operating costs and costs such as transfers to the General Fund; the Bureau has been requested to work closely with the City Finance Director in regard to ensuring that those figures are included the City's financial plans; staff is working diligently to review all costs, including outstanding debt through NPCA; NPCA is working diligently to find Regular Meeting Alameda City Council August 19, 1997 1 ways to refinance and reconstruct that debt; the Bureau may have to find some creative ways to deal with a couple of years between 1999 and 2002; and staff continues to investigate and review those issues almost weekly. Councilmember Daysog inquired over what period of time the $8 Million loan would be repaid. The Acting General Manager responded that the repayment period will depend upon the financing; there is about $400,000 or $500,000, in the General Plan, estimated for the eight-month start-up effort; the money loaned from the reserves will not have a substantial immediate impact on the use of the reserves; during the start-up period, additional outside financing will be investigated; $7.5 Million is not large financing in the municipal bond market; attracting investors may be a greater problem than finding an underwriter; and the repayment period is usually 15 years; and that the underwriter will provide advice on the matter. In response to Councilmember Lucas's inquiry regarding the Business Plan, the Acting General Manager stated that one of the first steps would be to conduct intense market surveys of potential cable television customers in Alameda; if there was not enough interest to support the Plan, the Bureau would report back to the Public Utilities Board and seek direction. In response to Councilmember Lucas's inquiry regarding the viability of the fiber optics business, Jim Fleming, Bureau employee, stated that fiber optic technology is the preferred and future technology in the industry. In response to Councilmember Daysog's inquiry regarding telecommunications, Mr. Fleming stated that marrying fiber optics with co-ax is one of the keys to telecommunications in the future, and businesses are attracted to a community with telecommunications. Councilmember Lucas stated it is clear the Public Utilities Board and Bureau staff are conscientiously trying to come up with alternative financial resources for the City; that at this point, the Council would not be authorizing the telecommunications business, it would be delegating authority to the Public Utilities Board to control and manage the telecommunications business to be developed; there should be no delay; and that there is enough protection if the Bureau had to back out. Councilmember Lucas moved that Council approve the recommendation. Councilmember Daysog seconded the motion. Under discussion, Councilmember Kerr stated that she could not Regular Meeting Alameda City Council August 19, 1997 ju support a Business Plan that did not have the financial protections she discussed earlier. Acting Mayor DeWitt stated that the City would be moving forward one step at a time; that Council would not be committing to the expenditure of any money until there was a Validation judgment by the Court; the Business Plan indicates a small investment and an opportunity to increase revenues; that he views fiber optics separately from the cable business; and fiber optics can be installed and leased. Councilmember Daysog stated there are tremendous challenges in making the investment; $8 Million spread over fifteen years is a lot of money; the Business Plan puts the City into the 21st Century, and will be a boon in terms of economic development for the City; and, hopefully, the City will receive the $3 Million per year transfer from the Bureau to the City's General Fund again. On the call for the question, the motion carried by the following voice vote: Ayes: Councilmembers Daysog, Lucas and Acting Mayor DeWitt - 3. Noes: Councilmember Kerr - 1. [Absent: Mayor Appezzato - 1.] ORAL COMMUNICATIONS, NON-AGENDA (Public Comment) (97-472) Neil Patrick Sweeney, Alameda, stated Councilmember Daysog should participate in the City of Oakland's Trade Commission Trip to the Philippines; that the government recently mandated digital satellite television by the year 2006, and it should be included in the Bureau of Electricity's [telecommunications] study; and that everyone should be instructed on the homeowners' accelerated mortgage payment plan. (97-473) Gerhard Degemann, Alameda, commented on construction projects that involve digging up and patching streets, such as the project on Otis Drive which now needs to be revisited because the street is waving; stated work is being done on Park Street and when contractors or agencies dig up streets after a couple of months there are deep compressions; and requested Council to direct the City Manager to make sure streets are maintained. Vice Mayor DeWitt stated said matter was noted by the Assistant City Manager. (97-474) Don Bergen, Alameda, stated between ten and twelve thousand Alameda residents ride AC Transit to the TransBay Terminal; that proposed destruction of the terminal is a political land grab; and urged Councilmember Daysog to change his stand on this issue. Regular Meeting Alameda City Council August 19, 1997 (97-475) Don Roberts, Alameda, commented on an article in the Alameda Journal by Mr. Sussman regarding the City Manager; stated that the City Manager is doing a good job; and urged the City Manager to select the Acting General Manager of the Bureau of Electricity as the Bureau's General Manager. COUNCIL COMMUNICATIONS (Communications from Council) (97-476) Consideration of Mayor's nominations (3) for appointment to the Economic Development Commission. [2 Community-At-Large Members and 1 Member with Marine/Waterfront Expertise.] On behalf of Mayor Appezzato, Vice Mayor DeWitt nominated Anne Cook and Pattianne Parker for reappointment and John Abrate for appointment to the Community-at-Large seat. (97-477) Written Communication from League of California Cities and Designation of Voting Delegate for League's Annual Conference. Vice Mayor DeWitt stated that the Mayor would like to continue to serve as the delegate to the League's Annual conference and he [Mayor Appezzato] suggests Councilmember Lucas serve as the alternate. Councilmember Lucas agreed that this arrangement should be continued. In response to Vice Mayor DeWitt's question regarding conference attendance, the City Manager stated all Councilmembers have been registered for the conference and asked Councilmembers to inform his staff if they choose not to attend. Councilmember Kerr stated that she plans to attend. (97-478) Councilmember Kerr stated one of the nicest features of the new Council Chambers is the comfortable seating for the people of Alameda, it is a great addition and was long overdue. The City Manager recognized Chief Building Official Steve Davis and Public Works Director Bob Warnick for their work on the renovation of City Hall. (97-479) Councilmember Lucas stated residents on Fernside Boulevard hear the beeping of Tidewater Sand and Gravel trucks; noise could be nearly eliminated by adding a $600 piece to their trucks; resolving this matter would take the cooperation of Tidewater Sand and Gravel, who are located on the Oakland side; she requested the City Manager to determine the best way to approach Tidewater Sand and Gravel--a letter from our Mayor to the President or by requesting Oakland officials to contact the President. Regular Meeting Alameda City Council August 19, 1997 ADJOURNMENT (97-480) Vice Mayor DeWitt stated he would accept a motion to adjourn. Councilmember Kerr moved adjournment of the meeting. Councilmember Lucas seconded the motion which followed by the following voice vote: Ayes: Councilmembers Daysog, DeWitt, Kerr and Lucas - 4. [Absent: Mayor Appezzato - 1.] Respectfully submitted, Diane B. Felsch, CMC City Clerk The Agenda for this meeting was posted in accordance with the Brown Act. Regular Meeting Alameda City Council August 19, 1997