City Council - Special Meeting

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Robert S. McKinnell City Clerk Kevin A. Larson City Treasurer Jennifer Lampman City Administrator Christian L. Bettenhausen City Attorney Placentia City Council Placentia City Council as Successor to the Placentia Redevelopment Agency Placentia Industrial Commercial Development Authority Placentia Public Financing Authority AGENDA June 2, 2025 Council Chambers 401 E Chapman Ave. Placentia, CA 92870 Phone: (714) 993-8117 Email: administration@placentia.org www.placentia.org KEVIN KIRWIN Mayor District 2 CHAD P. WANKE Mayor Pro Tem District 4 THOMAS HUMMER Councilmember District 1 WARD L. SMITH Councilmember District 5 JEREMY B. YAMAGUCHI Councilmember District 3 Mission Statement The City Council is committed to keeping Placentia a pleasant place by providing a safe family atmosphere, superior public services and policies that promote the highest standards of community life. Vision Statement The City of Placentia will maintain an open, honest, responsive and innovative government that delivers quality services in a fair and equitable manner while optimizing available resources. Copies of all agenda materials are available for public review in the Office of the City Clerk, online at www.placentia.org, and at Placentia Library Reference Desk. Persons who have questions concerning any agenda item may call the City Clerk's Office, (714) 993-8231, to make inquiry concerning the nature of the item described on the agenda. Procedures for Addressing the Council/Board Members Any person who wishes to speak regarding an item on the agenda or on a subject within the City's jurisdiction during the "Oral Communications" portion of the agenda should fill out a "Speaker Request Form" and give it to the City Clerk BEFORE that portion of the agenda is called. Testimony for Public Hearings will only be taken at the time of the hearing. Any person who wishes to speak on a Public Hearing item should fill out a "Speaker Request Form" and give it to the City Clerk BEFORE the item is called. The Council and Board members encourage free expression of all points of view. To allow all persons the opportunity to speak, please keep your remarks brief. If others have already expressed your position, you may simply indicate that you agree with a previous speaker. If appropriate, a spokesperson may present the views of an entire group. To encourage all views, the Council and Board discourage clapping, booing or shouts of approval or disagreement from the audience. PLEASE SILENCE ALL PAGERS, CELL PHONES, AND OTHER ELECTRONIC EQUIPMENT WHILE COUNCIL AND BOARD MEMBERS ARE IN SESSION. Special Accommodations In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the City Clerk's Office at (714) 993-8231. Notification 48 hours prior to the meeting will generally enable City staff to make reasonable arrangements to ensure accessibility. (28 CFR 35.102.35.104 ADA Title II) In compliance with California Government Code § 54957.5, any writings or documents provided to a majority of the City Council regarding any item on this agenda that are not exempt from disclosure under the Public Records Act will be made available for public inspection at the City Clerk's Office at City Hall, 401 East Chapman Avenue, Placentia, during normal business hours. Study Sessions are open to the public and held in the City Council Chambers or City Hall Community Room. Closed Sessions are held in the Council Caucus Room. While the public may be in attendance during oral announcements preceding Closed Sessions, Closed Sessions are not open to the public. 1

NOTICE AND CALL OF SPECIAL MEETING PLACENTIA CITY COUNCIL SPECIAL MEETING AGENDA - CLOSED SESSION June 2, 2025 4:30 p.m. - City Council Chambers 401 E. Chapman Avenue, Placentia, CA CALL TO ORDER: ROLL CALL: Councilmember/Board Member Hummer Councilmember/Board Member Smith Councilmember/Board Member Yamaguchi Mayor Pro Tem/Board Vice Chair Wanke Mayor/Board Chair Kirwin ORAL COMMUNICATION: At this time the public may address the City Council and Boards of Directors concerning any items on the Closed Session Agenda only. There is a five (5) minute time limit for each individual addressing the City Council and Boards of Directors. The City Council and Boards of Directors will recess to the City Council Caucus Room for the purpose of conducting their Closed Session proceedings. CLOSED SESSION PROCEEDINGS: The City Council and Boards of Directors will recess to the City Council Caucus Room for the purpose of conducting their Closed Session proceedings. Pursuant to Government Code Section 54957(b)(1) PUBLIC EMPLOYEE EMPLOYMENT/APPOINTMENT Title: City Administrator Pursuant to Government Code Section 54957(b)(1): PUBLIC EMPLOYEE PERFORMANCE EVALUATION Title: City Administrator RECESS: The City Council and Boards of Directors will recess to their 6:00 p.m. Special Meeting. 2

1. REGULAR AGENDA: 1.a Presentation of the Proposed Fiscal Year 2025-26 Operating Budget and Capital Improvement Program (CIP) - Study Session NOTICE AND CALL OF SPECIAL MEETING PLACENTIA CITY COUNCIL June 2, 2025 6:00 p.m. - City Council Chambers 401 E. Chapman Avenue, Placentia, CA CALL TO ORDER: ROLL CALL: Councilmember/Board Member Hummer Councilmember/Board Member Smith Councilmember/Board Member Yamaguchi Mayor Pro Tem/Board Vice Chair Wanke Mayor/Board Chair Kirwin INVOCATION: PLEDGE OF ALLEGIANCE: CLOSED SESSION REPORT: ORAL COMMUNICATION: At this time the public may address the City Council and Boards of Directors concerning any items on the Closed Session Agenda only. There is a five (5) minute time limit for each individual addressing the City Council and Boards of Directors. The City Council and Boards of Directors will recess to the City Council Caucus Room for the purpose of conducting their Closed Session proceedings. CITY COUNCIL MEMBER COMMENTS: FY 2025-26 EXPENDITURES: $92,686,878 REVENUE: $89,665,708 It is recommended that the City Council take the following actions: 1. Review and discuss the Proposed Fiscal Year 2025-26 Annual Operating Budget and Capital Improvement Program (CIP) and potential budget reduction options and provide input and direction for final budget adoption. ADJOURNMENT: The City Clerk will adjourn the Special City Council meeting to a regular City Council meeting on Tuesday, June 3, 2025 at 7:00 p.m. CERTIFICATION OF POSTING I, Nancy Albitre-Seely, Interim Deputy City Clerk for the City of Placentia hereby certify that 3

the agenda for the June 2, 2025 Special Meeting of the City Council was posted on May 30, 2025. ______________________________________________________ Nancy Albitre-Seely, Interim Deputy City Clerk 4

PLACENTIA CITY COUNCIL AGENDA REPORT Meeting Date: June 2, 2025 Submitted by: Nancy Albitre-Seely From: City Attorney's Office Subject: Pursuant to Government Code Section 54957(b)(1) PUBLIC EMPLOYEE EMPLOYMENT/APPOINTMENT Title: City Administrator Pursuant to Government Code Section 54957(b)(1): PUBLIC EMPLOYEE PERFORMANCE EVALUATION Title: City Administrator 5

Agenda Item No: 1.a PLACENTIA CITY COUNCIL AGENDA REPORT Meeting Date: June 2, 2025 Submitted by: Jennifer Lampman From: Finance Subject: Presentation of the Proposed Fiscal Year 2025-26 Operating Budget and Capital Improvement Program (CIP) - Study Session Financial Impact: FY 2025-26 EXPENDITURES: $92,686,878 REVENUE: $89,665,708 Summary: In accordance with City Charter Section 1203, the City Administrator must present the Proposed General Fund Operating Budget to the City Council for consideration at least 35 days prior to the beginning of each fiscal year. This item being presented for the City Council’s review and consideration is the Fiscal Year 2025-26 Proposed Operating Budget and Capital Improvement Program (CIP). Staff presented the Proposed FY 2025-26 Annual Operating Budget and CIP to the City Council on May 20, 2025, at which time the City Council requested a special meeting to discuss additional budget reduction options. Recommendation: It is recommended that the City Council take the following actions: 1. Review and discuss the Proposed Fiscal Year 2025-26 Annual Operating Budget and Capital Improvement Program (CIP) and potential budget reduction options and provide input and direction for final budget adoption. Discussion: See attached staff report. Fiscal Impact Summary: The Proposed FY 2025-26 Budget totals $92,686,878 in expenditures for all funds, with the General Fund comprising $52,654,458 of that. Budget reduction options identified by staff total $363,200. If approved, these reductions could decrease the burden on the Section 115 Trust and/or further add to reserves, either of which would help the City’s long term fiscal sustainability. Attachments Attachment 1 Budget Reduction Options.pdf 2025-26 Proposed Budget Study Session Presentation 6

Staff Report - 2025-26 Proposed Budget Special Meeting 6.2.25.docx Attachment 2 FY25-26 Proposed Budget 6.3.25.pdf 7

Proposed FY 2025-26 Budget Reduction Options Department Reduction Rationale/ Impact Reduction/New Revenue Amount City Administrator Allocate partial CA salary to Enterprise Funds Allocate 8% of City Administrator's salary to Sewer and Refuse Funds 28,700$ City Administrator Total 28,700$ Community Services Bring digital brochure & promotional material design in house No impact to community 5,500$ Community Services Change software used for scheduling No impact to community 2,500$ Community Services Eliminate Eggcitement event Staff is proposing partnering with faith based organization in support of their Easter egg events saving staff time with little to no impact to the community. 8,000$ Community Services Let's Dance Special Needs & Adaptive Programming Change timing of event from monthly to quarterly and eliminate free dinner for guests 4,000$ Community Services Eliminate Fall/Holiday movies in the park There would be less opportunities for families to enjoy movies in the park. Savings in staff time. 3,000$ Community Services Eliminate after school program at Whitten The program is underutilized due to competing programs at school next door which would have capacity to absorb current program attendees 4,000$ Community Services Drain McFadden Pool The City cannot open McFadden pool until it fixes the decaying pool deck per the County of Orange. The pool deck is beyond basic repairs and would require much more intensive replacement costing approx. $800,000. Staff is proposing to drain the pool, eliminating the need for annual chemicals and maintenance. 18,000$ Community Services Reduce size/ amenities of Heritage Festival Staff is proposing focusing on the Heritage parade & car show for the annual event, and reducing the amenities and size of the festival portion of the event 25,000$ Community Services Tamale Festival Stage Staff is recommending use of a mobile stage in lieu of the more elaborate setup that has been used in years' prior. 10,000$ Community Services Total 80,000$ Finance Reduce salaries Reduce Deputy City Administrator/ Director of Finance to Director of Finance position, 47,000$ Finance Total 47,000$ Police SWAT Ballistic Helmets Can move purchase from General Fund to Asset Forfeiture and/or JAG grant. Department is confirming rules for compliance with Department of Justice 10,000$ Police SWAT Ballistic Vest Plates Move cost to Asset Forfeiture (need prior approval from DOJ) 20,000$ Police Bulletproof vests Move cost to Asset Forfeiture (need prior approval from DOJ) 30,000$ Police Mobile Command Unit (MCU) Maintenance The MCU is inoperable and staff intends to sell the vehicle at auction 5,000$ Police Records Document Destruction Staff will complete this task with funds saved in current fiscal year 4,000$ Police Reduce staff training Officers will be limited on the mandatory training they attend 5,000$ Police Reduce part-time cadet position Reducing cadet in Investigations will require volunteers to continue to help with investigations 22,000$ Police Reduce Citizen's Academy supplies No impact if academy only offered once per year 1,500$ Police Reduce overtime to current fiscal year's level Will require reducing Citizen's Academy to one class per year (alternating english/ spanish language each year) 35,000$ Police Total 132,500$ 8

Public Works Eliminate sidewalk replacement (operating budget) This reduction would leave only $175,000 in CDBG funding for citywide sidewalk replacement which would impact repairs to existing trip hazards previously identified by Public Works. 50,000$ Public Works Reduce Fuel If the City partners with a private fueling station for purchase of fuel, the City could realize net savings on fuel costs. 25,000$ Public Works Total 75,000$ 363,200$ 9

Proposed Annual Operating Budget & CIP Fiscal Year 2025-26 June 2, 2025 City of Placentia 10

Budget Reduction Options General Fund Department Reduction Rationale/ Impact Reduction/New Revenue Amount City Administrator Allocate partial CA salary to Enterprise Funds Allocate 8% of City Administrator's salary to Sewer and Refuse Funds 28,700 Community Services Bring digital brochure & promotional material design in house No impact to community 5,500 Community Services Change software used for scheduling No impact to community 2,500 Community Services Eliminate Eggcitement event Staff is proposing partnering with faith based organization in support of their Easter egg events saving staff time with little to no impact to the community. 8,000 Community Services Let's Dance Special Needs & Adaptive Programming Change timing of event from monthly to quarterly and eliminate free dinner for guests 4,000 Community Services Eliminate Fall/Holiday movies in the park There would be less opportunities for families to enjoy movies in the park. Savings in staff time. 3,000 Community Services Eliminate after school program at Whitten The program is underutilized due to competing programs at school next door which would have capacity to absorb current program attendees 4,000 2 11

Budget Reduction Options General Fund Department Reduction Rationale/ Impact Reduction/New Revenue Amount Community Services Drain McFadden Pool The City cannot open McFadden pool until it fixes the decaying pool deck per the County of Orange. The pool deck is beyond basic repairs and would require much more intensive replacement costing approx. $800,000. Staff is proposing to drain the pool, eliminating the need for annual chemicals and maintenance. 18,000 Community Services Reduce size/ amenities of Heritage Festival Staff is proposing focusing on the Heritage parade & car show for the annual event, and reducing the amenities and size of the festival portion of the event 25,000 Community Services Tamale Festival Stage Staff is recommending use of a mobile stage in lieu of the more elaborate setup that has been used in years' prior. 10,000 Finance Reduce salaries Reduce Deputy City Administrator/ Director of Finance to Director of Finance position, 47,000 Public Works Eliminate sidewalk replacement (operating budget) This reduction would leave only $175,000 in CDBG funding for citywide sidewalk replacement which would impact repairs to existing trip hazards previously identified by Public Works. 50,000 Public Works Reduce Fuel If the City partners with a private fueling station for purchase of fuel, the City could realize net savings on fuel costs. 25,000 3 12

Budget Reduction Options General Fund Department Reduction Rationale/ Impact Reduction/New Revenue Amount Police SWAT Ballistic Helmets Can move purchase from General Fund to Asset Forfeiture and/or JAG grant. Department is confirming rules for compliance with Department of Justice 10,000 Police SWAT Ballistic Vest Plates Move cost to Asset Forfeiture (need prior approval from DOJ) 20,000 Police Bulletproof vests Move cost to Asset Forfeiture (need prior approval from DOJ) 30,000 Police Mobile Command Unit (MCU) Maintenance The MCU is inoperable and staff intends to sell the vehicle at auction 5,000 Police Records Document Destruction Staff will complete this task with funds saved in current fiscal year 4,000 Police Reduce staff training Officers will be limited on the mandatory training they attend 5,000 Police Reduce part-time cadet position Reducing cadet in Investigations will require volunteers to continue to help with investigations 22,000 Police Reduce Citizen's Academy supplies No impact if academy only offered once per year 1,500 Police Reduce overtime to current fiscal year's level Will require reducing Citizen's Academy to one class per year (alternating english/ spanish language each year) 35,000 Total $363,200 4 13

Measure U Funding Options • Measure M and Gas Tax projections lower than originally projected- $395,155 • $880,000 of Measure U funds previously identified for use by the Underground Storage Tank (UST) replacement could:  Be allocated towards tank installation  Be allocated toward the City Hall roof repair project. • Combined with $220,000 from Public Safety DIF to fully fund $1M project (Staff recommendation)  Backfill street project deficit  Remain unallocated at this time 14

FY 2025/26 Gas Tax Projections 15

Recommendations 1. Discuss budget reduction options and provide direction to staff. 16

Questions? 17

Placentia City Council TO: CITY COUNCIL VIA: ACTING CITY ADMINISTRATOR FROM: DIRECTOR OF FINANCE DATE: JUNE 2, 2025 SUBJECT: STUDY SESSION: PRESENTATION OF THE PROPOSED FISCAL YEAR 2025- 26 OPERATING BUDGET AND CAPITAL IMPROVEMENT PROGRAM (CIP) FISCAL IMPACT: FY 2025-26 EXPENDITURES: $92,686,878 REVENUE: $89,665,708 SUMMARY: In accordance with City Charter Section 1203, the City Administrator must present the Proposed General Fund Operating Budget to the City Council for consideration at least 35 days prior to the beginning of each fiscal year. This item being presented for the City Council’s review and consideration is the Fiscal Year 2025-26 Proposed Operating Budget and Capital Improvement Program (CIP). Staff presented the Proposed FY 2025-26 Annual Operating Budget and CIP to the City Council on May 20, 2025, at which time the City Council requested a special meeting to discuss additional budget reduction options. RECOMMENDATION: It is recommended that the City Council take the following actions: 1. Review and discuss the Proposed Fiscal Year 2025-26 Annual Operating Budget and Capital Improvement Program (CIP) and potential budget reduction options and provide input and direction for final budget adoption. DISCUSSION: In accordance with City Charter Section 1203, the City Administrator must present the Proposed General Fund Operating Budget to the City Council for consideration at least 35 days prior to the beginning of each fiscal year. This item being presented for the City Council’s review and consideration is the Fiscal Year 2025-26 Proposed Operating Budget and Capital Improvement Program (CIP). Staff presented the Proposed FY 2025-26 Annual Operating Budget and CIP to the City Council on May 20, 2025, at which time the City Council requested a special meeting to discuss additional budget reduction options. Approximately $360,000 have been identified as possible reductions. AGENDA REPORT 18

City Council Agenda June 2, 2025 Page 2 of 4 The Proposed Budget provides a funding guide that reflects the City’s priority to provide effective, high-quality public services that foster safety, quality of life, and economic prosperity throughout our community. The proposed budget was developed with a focus on repositioning the City’s financial position to one that’s sustainable in both the short and long term, prioritizes economic development that will enhance the City’s sales and transient occupancy tax bases, enhances public safety, replenishes reserves, and allows flexibility to respond to changes in the economy outside our control such as tariffs, inflation and changes in consumer spending. The City, like many other public agencies, is facing economic challenges that has necessitated a return to fundamentals wherein every program, contract, capital project and service offered by the City have been carefully scrutinized with only the most vital included in the proposed budget. While challenging, this analysis will enable the City to focus its resources on providing the highest level of service in its core functions while pausing or reassessing auxiliary programs. FY 2025-26 Proposed Budget Summary The proposed FY 2025-26 citywide operating budget is $92.7 million, a decrease of 6.6% from the Adopted FY 2024-25 budget. These expenses are supported by $89.7 million in revenue, a decrease of 5.9% from the current fiscal year’s Adopted budget, as well as unassigned fund balance in some special revenue funds. These total figures reflect revenues and expenses for all funds citywide including the General Fund, Enterprise Funds, Debt Service Funds and Special Revenue Funds. General Fund The General Fund is the primary operating fund of the City and supports fundamental services including Police, Fire & Life Safety, Development Services, Community Services and general administration. Revenue for this fund comes from general taxes such as property tax, sales tax, transfers from Measure U, transient occupancy taxes as well as a variety of user and permit fees and other smaller sources. The Proposed Budget for FY 2025-26 for the General Fund is $52.7 million in operating expenses, an increase of $1.7 million or 3.4% from the Adopted FY 2024-25 budget, supported by $53.5 million in operating revenue, an increase of $3.1 million or 6.2% from the Adopted FY 2024-25 budget. Compared to fiscal year 2024-25, the FY 2025-26 budget does not incorporate the use of the 10% reserve contribution from Measure U of $888,600 outlined in Policy 460 to support day-to-day operations. Instead, these funds will be added to the General Fund Measure U Contingency Reserve to replenish reserve fund balance which has decreased in recent years due primarily to construction of the public safety building. To balance the General Fund, $1,000,000 in Section 115 funds are proposed to be used to support the $461,000 increase in CalPERS’ Unfunded Actuarial Liability (UAL) and approximately fifty-three percent (53%), or $539,000, of the annual retiree medical costs. In addition, 19

City Council Agenda June 2, 2025 Page 3 of 4 approximately $500,000 in one-time revenues from the closing of outdated funds and incorporating those funds into the General Fund. As a result of the use of these one-time funds, and the need to address structural budget concerns, the City Council requested staff to identify additional budget reductions that could be incorporated into the Proposed FY 2025-26 budget. A complete list of these reduction options is attached to this agenda report, but some highlights include: Reduction Justification/ Impact Amount Drain Whitten Pool Pool has been shut down for 2 summers due to a deteriorating deck. Estimates to repair are over $800K for deck, pump room and staff office. No pool access for 3-5 summers. $18,000 Reimagine Heritage Parade & Festival Slim down the costs of rentals and stage/sound options. Eliminate VIP area and any frills. Treat the parade separately from the festival. Turn the festival into a car show/concert day. Limited vendors and a need for rentals. Possibly change parade route $25,000 Eggcitement Eliminate City sponsored event, partner with a faith- based organization to support their event $8,000 Cut Fall/ Holiday movies in the park Less staff and screen rentals needed, would reduce number of movies in the park available to the community $3,000 Reclassify Deputy City Administrator/ Director of Finance to Director of Finance No impact to operations $47,000 Reduce part-time cadet position in investigations Volunteers will need to continue to help with investigations, potential impact to pace of investigations $22,000 Reduce overtime in Police Reducing overtime to current fiscal