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HomeMy WebLinkAboutApproved Minutes - 2009-04-27 Special°o CITY COUNCIL SPECIAL MEETING MINUTES April 27, 2009 p[fAN Mayor Jack Hoffman called the special City Council meeting to order at 6:35 p.m. on April 27, 2009, in the West End Building, Santiam Room, 4101 Kruse Way. Present: Mayor Hoffman, Councilors Jordan, Johnson, Olson, Moncrieff, and Tierney. Councilor Hennagin was excused. Staff Present: Alex McIntyre, City Manager; David Powell, City Attorney; Robyn Christie, City Recorder; Kim Gilmer, Parks & Recreation Director Youth Council Pres nt: Youth Councilors Kosloff, Cooper, and Silbert. LO School Board Present: Chair Lepardo, Members Brown, Sheinin, and Swindells. Mr. Akerman was excused. 3. JOINT MEETING OF THE LAKE OSWEGO SCHOOL BOARD AND LAKE OSWEGO CITY COUNCIL 3.1 Welcome and Introductions Mayor Hoffman welcomed the Lake Oswego School Board. He noted that one reason for this joint meeting was the feedback received during the November 2008 campaign that the City Council was out of touch with the community and various organizations. As a result, the candidates promised to do public engagement and outreach. He indicated that this meeting was part of a two- year public engagement process by the Council. The Council and School Board members introduced themselves and described the journey that he/she had taken to reach his/her elected position. Mayor Hoffman spoke of the Council and the School Board meeting on a regular basis to check in with each other. 3.2 Comments from Mayor of Lake Oswego Mayor Hoffman discussed the short-term and long-term issues at the City. He noted that the Council has spent much time on the long-term issues (20 to 50 years out) because it was the role of the City to anticipate how things changed. He mentioned that the Council was working through a process to obtain public feedback on the Council's proposed strategic plan for the West End Building. He observed that another short-term issue was balancing the City's budget. He pointed out the short-term and long-term nature of the infrastructure issues facing the City, such as fixing the sewer system today while making sure that it lasted for 75 to 100 years. He indicated that the City was going out for full faith and credit bonds, paid for with revenues from the sewer system. He mentioned the meeting that City officials had with the ratings agencies in San Francisco to get the rating the City needed in order to borrow money, beginning with $60 million this year. He noted that the message he took home from the meeting was that the rating analysts wanted to know how the City would manage the money and what its plan was. He said that he had forcefully emphasized that the City would raise utility fees to cover the bond if necessary; the City would never pay for utility bonds using general fund monies. City Council Special Meeting Minutes Page 1 of 9 April 27, 2009 He reported that both rating agencies gave Lake Oswego a AAA rating, making it one of half a dozen cities to receive that rating at this time and allowing the City to save ratepayers dollars. He noted that this was also in spite of Moody placing every municipality, including school districts, on the negative outlook list. He mentioned that the rating analysts told the City officials that they would be watching the City; if it decided to use its reserves or operating money to pay for the sewer, then the agencies would reassess the City's bond rating. He noted other short-term issues, such as the continued revitalization of the downtown through urban renewal, the desire to revitalize Lake Grove and Foothills, the work on bringing the streetcar from Portland into Lake Oswego, and the water system project. He spoke of long-range issues in light of the community's changing demographics. He observed that people coming to the region put pressure on Metro to bring Stafford into the Urban Growth Boundary. He noted that Lake Oswego had many residents without children and many residents on fixed incomes who wanted to age in place. He mentioned another issue of mutual concern to the School Board, that the community was losing young families with children. He commented that according to the experts, a dynamic city was one with a mix up of ages and socio-economic levels. He raised the question of whether they could change the demographic trends occurring today. He held that they could do so but only with the help of parents, the schools, and the School Board. He mentioned two other primary issues for the City: emergency response and the library. He commented that the recent snowstorm and landslide brought home Mr. McIntyre's insistence that the City's emergency response capacity was of greater importance than it has been in the community up until now. He noted the importance of intergovernmental relations in helping the City obtain infrastructure funding for the state and federal governments. 3.3 Comments from Chair of Lake Oswego School Board Chair Lepardo noted that School Superintendent Bill Korach and Finance Director Stuart Petzler were both present. She indicated that Bill Swindells would be taking over as Chair on July 1. She read from a prepared statement. Chair Lepardo pointed out that as representatives of the School District and the City, the School Board and the City Council had an enormous impact on the viability and livability of the community. She recalled that in the past, circumstances, such as strong and stable State funding, community support, and inspired leadership, allowed the creation of strong schools and educational programs, and a focus on continuously improving the quality of instruction through factors, such as smaller class sizes and more electives. She observed that the current need to address the massive funding shortfall heading the District's way was a situation that would affect the livability of the community. She spoke of the residents' investment in the schools, from families with children to empty nesters relying on property values to local businesses. She commented that the greatest risk was to the children. She pointed out that District could not navigate the unprecedented economic challenges facing it alone: it needed the entire community. She expressed the District's appreciation of the support it has received from the City through their productive and mutually beneficial partnership. She spoke of continuing to explore common interests and expanding the possibilities of collaborative efforts on behalf of the community. Mr. Swindells noted the past relationship between the District and the City. He mentioned the tremendous community support of the District, as evidenced by the recent passage of a local option levy by a higher margin than five years ago in a community where 65% to 70% of the households did not have kids in the schools. He commented that this year's fundraising effort by the Foundation was actually the best it has ever had. He referenced the District packet provided to the Council. He explained that the 'best case' scenario actually meant the 'least worst case' scenario. He expressed his confidence that the District administration and the teachers association would work together to address the problems City Council Special Meeting Minutes Page 2 of 9 April 27, 2009 identified in the document. He mentioned marketing the District and attracting 98 out -of -district families by offering a competitive educational experience at half the price of the top private schools in the area, which was a good source of revenue. He concurred with Chair Lepardo that their first priority was the critical needs of the students so that they could keep advancing their education. He mentioned their hope that the District could continue to work with the City and remain a great attribute and draw to the community. 3.4 Opportunities to Enhance Cooperation Ms. Brown wondered whether the demographic study, to which Mayor Hoffman had referred, took into account an urban growth boundary. She commented that one of the District's problems was that Lake Oswego was essentially built out and not adding the new housing that normally attracted new families with young children. She questioned how the community could be dynamic and attract new families when there was no room to do so in the most common way, which was to build new housing. Mayor Hoffman pointed out that expanding the UGB to include Stafford would not help the Lake Oswego School District because West Linn and Wilsonville School Districts had that area. He mentioned the alternative housing used by other communities to attract young families, such as the Great House concept in New Jersey and market-based housing in Vancouver, B.C. Councilor Johnson spoke of the need to encourage young people to return to Lake Oswego after finishing college, instead of them living in Portland and becoming attached to that community, instead of to Lake Oswego. She suggested working towards attracting young families by building a sense of community for several generations, as Lake Oswego would never have housing as cheap as other areas. She pointed out that Lake Oswego had selling points, such as the School District and a high quality community worth paying a little more to live in. Councilor Moncrieff mentioned retaining and creating jobs as another way to attract young families and singles. She spoke of the Council's work on economic development and finding ways to help startup businesses be successful. Mayor Hoffman indicated to Mr. Swindells that economic development was collaborative in terms of business alliances within the County and the region. He commented that it was not competitive with neighboring suburb communities because each community was different. Mr. Swindells mentioned that two-thirds of Clackamas County residents left the County to work elsewhere. He asked how many Lake Oswego residents left to work somewhere else. Mayor Hoffman said that quite a few people lived here and worked some place else. He indicated that the Council has discussed sustainability and the importance of transit in lowering transportation costs. Councilor Olson commented that the Council has also discussed how to improve the situation of many of Lake Oswego's first responders and City employees not living in the community. Mayor Hoffman asked how many Lake Oswego graduates completed college. Chair Lepardo said that the District's high school parents group tracked how many kids gave feedback on whether their first and second years were successful. She explained that colleges and universities did not necessarily want to track how many freshmen went on to graduate or reveal their graduation rates. Mr. Swindells pointed out that if a student made it through his/her freshman year, then almost the only reason he/she would leave school after that was money. He said that getting second and third year responses from Lake Oswego students was a good indicator that they were completing their college work. Councilor Tierney said that he thought that the housing stock drove much of the population for the schools. He spoke of the upcoming Comprehensive Plan update as an opportunity for the District to advocate for housing for all populations. He mentioned a Neighborhood Planning Task Force and a plan that currently discussed assessing the existing housing stock but not expanding City Council Special Meeting Minutes Page 3 of 9 April 27, 2009 the housing stock to attract young families with children. He held that advocacy coming from all directions was important to change plans and attitudes. Councilor Jordan discussed her concern with the State's method of funding school transportation, which encouraged bussing kids to school, instead of reducing the energy footprint. She mentioned the City's desire to increase walkability, bicycling, and the use of non -energy burning fuels. She commented that she saw an opportunity for a mindset change at the State legislature to allow the schools to spend the allotted transportation funds on things other than transportation, while making sure that the kids got to school safely. She acknowledged Mr. Swindells' point that the transportation money would simply go away if the schools did not use it on transportation. She reiterated that Salem needed a mindset change towards becoming more green and energy-efficient. Ms. Brown mentioned hearing from several neighborhoods about the lack of safe walking conditions for the children. She suggested that the District and the City together explore the Safe Routes to School program. Councilor Moncrieff agreed that that was a great opportunity for cooperation between the City's Transportation Advisory Board, the School District's PTAs and PTOs, and the neighborhood associations. Councilor Moncrieff mentioned a model on Safe Routes to School done by the Westridge Neighborhood Association in conjunction with Westridge Elementary School. She spoke of coordinating efforts between other neighborhood associations and elementary schools and prioritizing funding through transportation grants. She noted that State Senator Devlin was a proponent of the Safe Routes to School program. Chair Lepardo asked what the plans were for Foothills. Mayor Hoffman explained that the private property owners and their developer were working with the City towards a preliminary development agreement in a potential public/private partnership. He indicated that while the City was moving in the direction of transforming Foothills from an industrial area into a residential/commercial/retail area, the private property owners drove the discussion. He commented that the idea was to increase the vibrancy of downtown Lake Oswego and to connect the city with the river, while also creating more affordable housing stock, such as condominiums. Mr. Sheinan commented that another issue was people like himself with kids already graduated who wanted to stay in Lake Oswego. Mayor Hoffman asked for an overview of the District's current situation. Ms. Brown mentioned a letter from the Governor asking the District to plan for a best -case scenario of a $7.4 million gap between what the State would provide and what the District needed. This represented a 15% reduction of the current annual operating budget of $55 million. Ms. Brown noted that the worst-case scenario was a $10 million gap. She said that the District has been working on it but still had a $1.7 million gap (best case) or $3.8 million gap (worst case) to cover. She indicated that the best case translated to the equivalent of 24 teachers, and the worst case to 54 teachers. Mr. Swindells commented that the tradeoff that came up was always class size versus specialists. He indicated that parents always erred towards class size, while others felt that it was important to keep the elementary school specialists and high school electives needed in a college prep district. Mr. Swindells indicated to Councilor Olson that the District has looked into the impacts of closing a school. Right now, that action would not generate sufficient savings to offset the collateral damage of redistricting, etc. He explained that the situation was more census driven than money driven. If the District lost a lot of kids, then closing a school might become a more viable option. He indicated to the Councilor that Lake Oswego did not have the small schools with only 150 kids that Portland did; Lake Oswego had optimally sized schools, and closing a 400 -student school did not make sense. Ms. Brown indicated that Westridge had only around 200 students, but reiterated that it did not make sense to close the school because of the redistricting required. City Council Special Meeting Minutes Page 4 of 9 April 27, 2009 Chair Lepardo indicated to Mayor Hoffman that the District would know how much the funding gap would be after the May 15 forecasts were in. Ms. Brown indicated to Mayor Hoffman that the District would plan all next year for how to do things differently in 2010/2011. She observed that there was a point in cutting items where one lost the integrity of the entire system, such as cutting too many electives lost the college prep designation, or eliminating art and music lost elementary school families. She spoke of looking at partnerships and opportunities for providing services in different ways. She directed the Council to the packet, which demonstrated that the District has looked carefully at everything, including facility use and maintenance issues. Mr. Swindells mentioned that the District's scheduling systems for 7th and 8th grades and for the high schools were very different. A profound and innovative change that could gain efficiencies in staffing across six grades, instead of across a few, was making those scheduling systems identical. He emphasized that the District was making a proactive effort to address the situation. Ms. Brown indicated that the District has been examining the situation every month. She said that the District had to have its budget finalized by June 30. She noted the question of whether the State would be able to come up with the money to fund the schools, given that it did not provide the promised $1.2 million last year. She emphasized that these tremendous uncertainties drove the District to look at every partnership and operational change that could save general fund money in order to protect the District's core mission: a college- prep complete education. Chair Lepardo mentioned that the teachers have once again stepped up to the plate and passed on their raise next year, which would save the District $1 million. Mr. Sheinan recalled that Dr. Korach proactively made many cuts in the 1990s, many of which have continued to the present. Consequently, the District did not have much fat to cut. Mayor Hoffman commented that the economic situation has also affected higher education, citing the PSU President's request that all administrators take a 10% salary cut to save programs. Councilor Olson indicated to Mayor Hoffman that Oregon City was closing their smallest elementary school in hopes of saving approximately $7 million. She explained that lacking a local option, the economic times were hitting Oregon City harder than Lake Oswego. She mentioned that Oregon City lost 70 students at the beginning of the school year, which started them off in the red. Ms. Brown indicated to Mayor Hoffman that West Linn being a growth district has helped its situation. She mentioned that West Linn had also purchased property in anticipation of that growth, which gave them something to sell as a fallback. She noted that some districts were using their reserves and waiting quietly to see what everyone else did. She reiterated that Lake Oswego preferred proactive planning, as parents would not tolerate sudden disruptions in the K-12 system. Councilor Olson indicated to Chair Lepardo that the Oregon City parents' response to the school closure was the equal of how Lake Oswego parents would respond to such news. Dr. Korach indicated that a $10 million gap would require the District to close six elementary schools. He pointed out that right now their elementary schools were full of programs. The District was in that awkward place where it was not small enough to close those schools well, and therefore this was not a good time to use that strategy, although they would have to consider that strategy seriously next year. He agreed that the emphasis now was to get from this year to the next year and to approach on a tactical basis how to save as much as possible. Mr. Petzler indicated to Councilor Jordan that it cost the District around $160,000 per day to run the schools. Councilor Jordan commented that she understood that the District was not planning to cut days, but, even if it did, the shortfall gap was so big that cutting three months would not solve the problem. City Council Special Meeting Minutes Page 5 of 9 April 27, 2009 M . Brown concurred that they could not 'cut' their way out of this. She spoke of relying on community support and doing things differently. She cited Councilor Johnson's taking advantage of electives at Lakeridge as laying the foundation for her current success. She argued that they could not risk losing those opportunities or they risked losing students. She indicated that the question facing the Board next year was how to provide complementary rich programming. She mentioned that the Board has the administration's suggested plan and was currently listening to the public before making its final choices and setting its budget. She observed that the District was dependent on Salem for its funding, something that the public might not know. The Council explained that the City's general fund revenues came from property taxes capped by Measure 5, with other monies coming from self-supporting utility funds and program fees. Mr. McIntyre indicated that the Council set the property tax rate, which it has not adjusted for many years. Councilor Jordan commented that there was very little rate left under the cap that the Council could assess. Mayor Hoffman explained that if the City needed money for public safety improvements, then it had to go out for a vote, the same as the District. He concurred with Chair Lepardo that the City had stable funding year to year. He pointed out that its funding was dependent on property taxes, and not on income or sales taxes. Dr. Korach indicated to Mayor Hoffman that losing 20 to 30 teachers meant driving the elementary class size up to 31 to 32 students and high school classes up even more than that. He noted that Lake Oswego has never experienced large class sizes. Ms. Brown commented that given the current classroom ratio of 1:20, the parental experience of the first day of school would dramatically change with such large class sizes. She said that a teacher could not give individualized attention in classes with more than 30 kids. Councilor Jordan pointed out that this situation affected every district in the state. She held that all parents were going to have to volunteer more and be more involved. She observed that every district would face one or two of the drastic measures, whether it be larger class sizes, a shorter school year, or reductions in programs. She commented that people likely found it hard to understand that the allocations they saw on their tax bill for schools, city, and county were all separate allocations. She recalled the court cases filed in the last ten years, which yielded decisions clearly stating that the different allocations had to stay separate: school money was school money and city money was city money. Councilor Jordan indicated to Chair Lepardo that the City paying for after school sports had been an avenue pursued after Measure 5 but before the court cases. Mayor Hoffman recalled that for three years, the City had levied $9 a year for after school activities. After Measures 45 and 50, that $9 was rolled into the City's permanent tax rate. In 1999, schools were given the authority to go out for their own levies. He mentioned that the District had gone out for a $3 million local option levy at that point. Councilor Johnson asked if Jesuit High School was also losing students. Mr. Swindells said no. He indicated that they kept an eye on the alternative schools, such as Jesuit, Westside Christian, and charter schools. Ms. Brown discussed the District's dependence on community support through the Foundation, as those funds formed a significant portion of the budget these days. She commented that if the people thought that the District was not using that money to lower class sizes, then they risked losing that community support. She spoke of the long history of the District and the City working together to help each other through a variety of avenues, including shared -use partnerships on field maintenance and use of tennis courts. She suggested that they might find more opportunities to work together if they looked at the partnerships and agreements that they have developed over time. City Council Special Meeting Minutes Page 6 of 9 April 27, 2009 Councilor Moncrieff spoke in support of working towards partnerships and agreements. Ms. Brown confirmed that the best -case scenario was a $1.7 million shortfall, or 24 full-time positions, and the worst-case scenario was a $3.8 million shortfall. She mentioned hearing that Salem was planning to study revenue enhancements over the next two years, but that would not help the District in its current effort to survive year to year. Ms. Brown confirmed to Mayor Hoffman that the District could implement a construction excise tax. She asked if the City assessed system development charges against new construction only or also against new additions. Councilor Johnson clarified that the City charged SDCs only if there was an increase in dwelling units; a tear down and replacement generated no SDCs. Mr. Powell pointed out that the City applied different SDCs differently, depending on the circumstances. Ms. Brown asked, given that an excise tax was based on square footage, if the City had any sense of how much new construction there might be. Mayor Hoffman said that while the Building Department could provide the District with the City data on new building in 2008/2009, that information would not help the District much, as there was unlikely to be much new construction this year. Ms. Brown commented that the nice thing about an excise tax was that it was not restricted as bond money was, but could be used for a wide variety of things, excepting personnel. Chair Lepardo asked if a School SDC would be equivalent to the Parks SDC. Ms. Gilmer explained that the City based its Parks SDC on a 20 -year capital plan and population growth calculations. She said that the District would have to develop a plan and base its SDC on that plan; therefore, the two SDCs were not comparable. Councilor Tierney spoke in support of looking at current partnerships in order to identify other avenues to help the District address these significant financial issues. Mr. McIntyre indicated to the Councilor that the City did not face a time crunch on doing so, although the District might. Ms. Brown commented that looking at their past partnerships might provide guidance on what was potentially available to use today. Youth Councilor Kosloff said that he moved to Lake Oswego two years ago for the schools. He commented that he found the discussion about maintaining the flow of families coming to Lake Oswego for the schools interesting. He said that what drove his family to move to Lake Oswego was a cost benefit analysis: the excellent education and educational environment offered by the schools offset the expensive housing. He spoke of developing a plan to communicate clearly that Lake Oswego exceeded expectations in most everything it did. Youth Councilor Cooper mentioned serving on the Pacer Council at Lakeridge. He said that they have been discussing the potential budget cuts. He indicated that most of the students remembered the District cutting school days when they were in elementary school. He reported that their primary concern was losing their block scheduling of eight periods and one and a half hour long classes. He described this scheduling as unique to Lake Oswego and cherished by the students. He indicated that anything that would preserve and prioritize maintaining the eight class periods would benefit the students. Youth Councilor Cooper indicated to Chair Lepardo that he knew many students who took the single year electives and enjoyed having the eight periods because they could fit in their required classes, the classes that might catch the eye of colleges reading transcripts, and the classes that they took for fun. Youth Councilor Silbert said that he also served on the Pacer Council at Lakeridge, and that he moved to Lake Oswego for the schools. He concurred with Youth Councilor Cooper's comments about the importance to the students of having eight classes. He indicated that a six period schedule would not work out well for him personally. He concurred with Youth Councilor Kosloff about the critical need for a plan. He argued that they first needed concrete details of what the budget cuts would be. He spoke of the importance of an outreach to the students, as well as to the parents. City Council Special Meeting Minutes Page 7 of 9 April 27, 2009 Youth Councilor Cooper commented that in making its tough decisions, the Board talking to the students might help the process by identifying what the students highly valued and what they felt they could do without, while still maintaining a college prep focus. Youth Councilor Kosloff expressed concern regarding which electives might be cut. He gave an example of one of his favorite courses, AP European History. While it was technically not required by the State, it was still a core class. He acknowledged that the District would choose a basic foundational core class, like Geometry, over an extra like AP Government or AP European History, yet the AP classes were what gave the schools their college preparatory nature. Chair Lepardo commented that the Youth Councilors were a good example to the public of why they wanted to keep the schools at their current level. She observed that the Youth Councilors' poise and ability to think on their feet surpassed many adults that she knew. Councilor Johnson spoke to asking the Youth Councilors to serve as one of the many needed advocates for whatever difficult avenue the District chose. Youth Councilor Silbert acknowledged that the students would be speaking of what was in their best interests, yet he argued that it was crucial to get their input on what should or should not be cut. Youth Councilor Kosloff said that once they received more details, the Youth Council would work to develop an opinion on the issue. He said that he knew that the Youth Council would be willing to do whatever it could to help the Board and the Council. Councilor Johnson said that she would work with the Youth Council. Dr. Korach indicated to Councilor Jordan that the District was preparing to make decisions on what the range of possibilities were, in order to make those decisions in the first part of June. He said that they needed to inform their staff of those decisions before school let out for the summer. Chair Lepardo asked what the Council was doing about the West End Building, noting that it was the number one issue in the community. She asked how the District could help. Mayor Hoffman explained that the Council has developed some goals and implementing strategies for the West End Building and other facility facilities, which it was taking out for public input through a variety of venues. He said that the Council did not plan to sell the building today, but rather to try to increase its value and to look at selling it or developing a public/private partnership several years down the road. He spoke of trying to get some income from the building, such as renting it for classroom space. Chair Lepardo commented that the Council's plan made perfect sense. Mr. Sheinan spoke in support of getting feedback from a broader spectrum of the community. Mayor Hoffman noted that the building cost the City three-quarters of a million dollars annually to operate and maintain. He indicated to Chair Lepardo that some outside groups have expressed interest in using a portion of the building but not in purchasing it. Councilor Jordan mentioned that numerous parents have asked why the City did not take over the swimming pool. Mr. Petzler indicated that the swimming pool operating costs were $180,000 a year. Citing the disinformation generated by rumors, Councilor Jordan suggested that the Council and the District send out a message together detailing what kinds of things the City could do to help the District at this point in time. Mayor Hoffman suggested forming a joint subcommittee of two School Board members and two Council members to discuss the joint agreements, such as field maintenance, and to explore options. Chair Lepardo commented that it was a good idea, although the Board would not have time until July. Councilor Olson concurred with setting up the committee. She commented that it was also important to let people know how much the City and the District cooperated already, such as the City paying for the School Resource Officer. Councilor Tierney suggested a joint resolution by the Council and the Board. City Council Special Meeting Minutes Page 8 of 9 April 27, 2009 Ms. Brown commented that this meeting has provided an opportunity for the Council and the Board to work together more closely than they have in the recent past. She spoke of making sure that people were aware of each organization's successes in areas where they did cooperate. 4. ADJOURNMENT Mayor Hoffman adjourned the meeting at 8:20 p.m. Respectfully submitted, Robyn 6ristie City Recorder City Council Special Meeting Minutes Page 9 of 9 April 27, 2009