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HomeMy WebLinkAboutStaff Report 2.A 04/13/2009CITYOFPy1V E�T�A7LUUMA, CALIFORNIAy AGENDA BILL W April 13, 2009 Agenda Title: Resolution Authorizing Reorganization, Layoffs and Meeting Date: April 13, 2009 Abolishing the Following Positions in the Community Development Department for Fiscal Year 2008-2009 due to Lack of Work or Funds: One Meeting Time: ® 7:00 PM Assistant Director of Community Development; One Associate Planner; One Administrative Assistant; and One Permit Processing Technician. Category: ❑ Presentation ❑ Consent Calendar ❑ Public Hearing ❑ Unfinished Business © New Business Department: I Director: Contact Person: Phone Number: City Manager's Office I John C. Brown John C. Brown 707-778-4345 Cost of Proposal: The proposed layoffs and abolishment of positions will Name of Fund: Community result in a net savings of at least $63,000 in the Community Development Development Enterprise Enterprise and General Fund. Fund/General Fund Amount Budgeted: N/A Account Number: Recommendation: It is recommended that the City Council take the following action: Adopt the attached Resolution abolishing four positions from the FY 2008-2009 budget due to lack of work or Rinds and determining that it is necessary to layoff four employees occupying the abolished positions or any positions to which such employees have and invoke displacement rights. Summary Statement: In June 2008 the City Council approved establishing an enterprise fund to support the staffing and work program of a portion of the Community Development Department. The enterprise portion of the CDD budget was based on estimated revenues from building permit applications and cost recovery for anticipated development and zoning applications. Revenues have not kept pace with expenditures due to a decrease in development activity. To bring department expenditures in line with revenue estimates, staff recommended and the Council approved abolishing 12 positions in the department, and laying -off 12 employees in September 2008. That action was not sufficient to balance revenues and expenses through the remainder of the year. A deficit continues to grow in the CDD enterprise, now supported by the General fund which lacks the capacity to provide that support. Pursuant to this recommendation, four positions in Community Development would be abolished and the four employees occupying the abolished positions or any positions to which such employees have and invoke displacement rights would be laid off. The CDD Director will remain through much of this fiscal year to assist with evaluating options for continued services into the future, and to manage current and advance planning functions during the transition. Continuity of current planning services will be provided by existing employees who will be brought back on a strictly part time and cost recovery basis, and by the temporary and contract planners currently utilized by the department. Attachments to Agenda Packet Item: 1) Draft Resolution Reviewed by Finance Director: Reviewed by City Attorney: Approved by City Manager: Date: Date: Date: Rev. # Date Last Revised: File: CITY OF PETALUMA, CALIFORNIA APRIL 13, 2009 AGENDA REPORT FOR Resolution Authorizing Reorganization, Layoffs and Abolishing the Following Positions in the Community Development Department for Fiscal Year 2008-2009 due to Lack of Work or Funds: One Assistant Director of Community Development; One Associate Planner; One Permit Processing Technician; and One Administrative Assistant, Effective April 30, 2009 RECOMMENDATION: It is recommended that the City Council adopt the attached resolution. The Council's action is necessary to implement the layoff procedures identified in the applicable memoranda of understanding, compensation plans and personnel rules in order to reduce deficits projected in the Community Development Department budget for the remainder of the fiscal year, and their impacts on the General Fund. 2. BACKGROUND: In June 2008, the City Council approved a proposal to establish an enterprise fund (the enterprise) to support the staffing and work program of a portion of the Community Development Department (CDD). The enterprise was intended to support the Planning, Building, and Geographic Information System functions of the department, including current and advance planning, General Plan implementation and public policy work anticipated in the coming fiscal year. The larger department budget also included a General Fund subsidy of approximately $370,000 (for administrative costs and Code Enforcement) and the various funds that support the Housing Division. The Housing Division budget will not be directly affected by this proposal. The enterprise budget was based on estimates of projected revenues from building permit applications and cost recovery for anticipated development and zoning applications. By August 2008, actual revenue receipts showed a significant decline from original estimates. To bring department expenditures in the enterprise in line with revised revenue estimates, staff recommended and the Council approved abolishing 12 positions in the department, and laying -off 12 employees in September 2008. That reduced the CDD budget by approximately $1.1 million. Beginning in October, 2008, department functions that were not directly tied to a source of permit or cost recovery revenue were curtailed to match anticipated revenue. Service reductions included: • Reduced public counter hours and direct phone access; • Access to staff by appointment only; • Building inspection schedules on specified days of the week with longer lead times for scheduling; • Using part-time or contract planning and building staff commensurate with workload and available finds from application fees; Curtailment of advanced planning, including work on the Development Code update, "Green" programs, Public Art program coordination, and programs such as flood plain administration. To maintain continuity for those projects that were in process at that time and new projects since, the department has used a combination of contract services and part-time employment provided to staff members who were subject to layoffs. These activities were intended to be self-supporting, through cost recovery from project applicants. DISCUSSION: Development activity has not reached the levels anticipated in the revised CDD budget. Associated revenues continue to lag expenses in the enterprise, resulting in a current deficit of approximately $286,000. Actual expenses charged to the enterprise, as of April 8, 2009, were $1,274,225. Revenues for the same period were $998,444. The shortfall is now being supported by the General fund, which, without this impact or further adjustment to its appropriations is also presently estimated to end the fiscal year out -of -balance. A listing of permanent full-time personnel assigned to the CDD (excluding Housing functions) follows: Director of Community Development Assistant Director of Community Development Geographic Information System Manager Associate Plamier Senior Building Inspector Neighborhood Preservation Coordinator Administrative Assistant Permit Processing Technicians (2) Of these positions two, the Senior Building Inspector and one Permit Processing Technician, are assigned to the Building function. Their activities are fully supported by permit revenues, and are currently not affected by the recommended action. Revenues associated with current planning are also sufficient to support activities, insofar as they apply to the direct processing of those applications which is done on a cost recovery basis by contract and part-time hourly planners. Shortfalls are associated with the positions providing management, administrative, and functional support current and advanced planning, and building activities. These positions include the Director and Assistant Director, Administrative Assistant, and Geographic Information System Manager, most of which are supported, in varying amounts, by the General Rind. One additional position, the Neighborhood Preservation Coordinator, is funded entirely in the General fund, and one position. a Permit Processing Technician, provides half time support to the Neighborhood Preservation Coordinator, funded by the General Fund, and half time support to cost recovery activities associated with current planning in the enterprise. 3 Because the enterprise has no reserves, and because the General Fund lacks the capacity to absorb this deficit, this recommendation is coming to the City Council, to bring projected enterprise revenues and expenditures into balance as quickly as possible to halt the growth of the operating deficit in the enterprise and its corresponding impact to the General Fund. Reductions to both the enterprise and the General Fund supported activities of the CDD are necessary to halt the budget shortfall. These actions are not sufficient to fully eliminate the deficit. Effective April0, 2009 the following actions are recommended: abolish the Assistant Director, Associate Planner, Administrative Assistant, and one Permit Processing Technician, and lay off the employees occupying those positions. The Geographic Information System Manager will be transferred to the Information Technology division of my office, where the costs of that position will be distributed to the departments and other funds utilizing his services. The Neighborhood Preservation Officer will be transferred to the Police department. That action groups code enforcement with similar enforcement functions, and substitutes a portion of the administrative support currently provided to that position by the Permit Processing Technician. It should also be noted that although the Administrative Assistant position is recommended to be abolished, the employee occupying that position was offered a position in the Water Resources Department and will commence work there on April 20, 2009. All of these actions will save, between the combination of the enterprise and the General Fund, an estimated $63,000 after gross savings are adjusted for the leave pay -outs associated with the separation of these employees from service. Additional savings will be derived from supplies that will not be used as a consequence of any lay- offs, although that amount has not been calculated. It will also be recommended, on a subsequent agenda, that effective either May 31, or June 30 depending on the decision of the Community Development Director, that his position will be abolished. Costs of approximately $11,500 per month will accrue to the General Fund in the meanwhile, but are necessary to provide for continuity in current and advanced planning and the development of a transition plan. The proposed layoffs will have some effect on current planning services, particular those associated with staffing the counter and phones, and responding to inquiries from the public. It will also require the transfer of tasks such as alcoholic beverages enforcement and flood plain management to other departments. The most significant impacts of this recommendation will be in the area of advanced planing, which will still need to be funded at some level through the General Fund, but which will have slower tum -around times due to the lack: of adequate resources to address them. In the short-term, the Director will continue to provide these services, as well as to manage current planning services. In the longer tenn, a different management model will be necessary. With respect to the transition, to maintain continuity and to assure that new and existing projects are not unnecessarily delayed in process, laid off employees will be brought back on a strictly hourly and fully cost recovery basis through at least June 30, 2009, unless they take alternate employment sooner. During that period, staff will evaluate three options: privatizing current planning functions; contracting for these services from another public agency; and exploring a model that duplicates a private contract but which is delivered using the existing group of permanent, part-time, and contract planning staff. CDD. No recommendations are forwarded at this time regarding the Building Division, as it fully self-supporting. Staff will evaluate whether this function can be established as a stand-alone department, as it has been in the past, whether it should be organized with another City department, or the services provided through the oversight of another public agency. The focus of the Director's work during this transition period will be to insure that the department is able to fulfill its basic legal and procedural obligations to review and act on zoning, development entitlement and building permit applications as required by and in accordance with applicable local, state and federal law. At the same time, those services need to be balanced with anticipated revenues. With respect to advanced planning, it is anticipated that those responsibilities will shift to my department. I will return to Council with a plan for managing those functions within the next two months. 4. FINANCIAL IMPACTS: This recommendation is necessary to stop the growing deficit in the Enterprise, and its corresponding negative impact on the General fund. The deficit has grown approximately $36,000 during the past month and would, at that rate, increase the burden to the General Fund by approximately $90,000 by the end of the fiscal year. Since the vast majority of the department's expenditures are in personnel costs, staff is recommending that the City Council abolish 4 full-time equivalent positions in the Community Development Department due to the anticipated lack of funds. The proposed reduction in force, combined with comparatively minor reductions in related supplies and services, will result in proposed department expenditures being in balance with estimated revenues for the remainder of fiscal year 2008-2009. Resolution No. 2009 -N.C. S. of the City of Petaluma, California AUTHORIZING REORGANIZATION, LAYOFFS AND ABOLISHING THE FOLLOWING POSITIONS IN THE COMMUNITY DEVELOPMENT DEPARTMENT FOR FISCAL YEAR 2008-2009 DUE TO LACK OF WORK OR FUNDS: ONE ASSISTANT DIRECTOR OF COMMUNITY DEVELOPMENT; ONE ASSOCIATE PLANNER; ONE ADMINISTRATIVE ASSISTANT; AND ONE PERMIT PROCESSING TECHNICIAN WHEREAS, for fiscal year 2008-2009, the City Council established the Community Development Enterprise Fund and assigned revenues from building permit applications and cost recovery from the processing of certain development entitlement and zoning applications; and, WHEREAS, said revenue was intended to support the planning, building and geographic information systems functions of the Community Development Department; and, WHEREAS, the Community Development Department budget for fiscal year 2008- 2009 included estimated total revenues from building permit applications and development entitlement applications to be approximately $2.1 million; and, WHEREAS, actual revenues as/of September 2008 were approximately 60% less than the May 2008 estimate; and, WHEREAS, in September 2008, to bring anticipated department expenditures into line with the latest revenue estimates as quickly as possible, staff recommended and the City Council abolished 12 positions supported by the Community Development Enterprise Fund and to layoff the 12 employees occupying the abolished positions or any positions to which such employees have and invoke displacement rights. WHEREAS, due to a decrease in the volume of anticipate development applications revenue has continued to fall short of expenditures, such that the Community Development Enterprise Fund currently has a $286,000 deficit, which is being supported by the General Fund; and Resolution No. 1008-184 N.C.S. Page 6 WHEREAS, current estimates of General Fund balance suggest that the General fluid does not have the capacity to absorb the Community Development Enterprise Fund deficit, so that further staff reductions in the Community Development Department are necessary; NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Petaluma does hereby authorize the reorganization, layoff and abolishment of the following positions in the Community Development Department for fiscal year 2008-2009 due to lack of work or finds: One Assistant Director of Community Development; One Associate Planner; One Administrative Assistant; and One Permit Processing Technician. And that said reorganization and layoffs shall occur in accordance with applicable memoranda of understanding, compensation plans and personnel rules. Under the power and authority conferred upon this Council by the Charter of said City. REFERENCE: 1 hereby certify the foregoing Resolution was introduced and adopted by the Approved as to Council of the City of Petaluma at a Regular meeting on the 15°' day of September. form: 2008. by the following vote: AYES: NOES: ABSENT: ABSTAIN: ATTEST: City Clerk City Attorney Mayor Resolution No. 2008-184 N.C.S. Page 7