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June 22, 2012

DHS City Council - June 19

The audio recording of this meeting of the Desert Hot Springs City Council is available here.

Councilmember Adam Sanchez was absent from this meeting due to "a training program that he had to attend," Mayor Parks explained. Mr. Sanchez had emailed that information to her. The Mayor asked that his absence be excused.


Mayor Pro Tem Pye, who has been doing the "Invocation/Moment of Silence" since the Ministerial Fellowship stopped doing it, took this opportunity on June 19 to read an excerpt from an essay on the subject of Juneteenth. It was June 19, 1865, Union General Gordon Granger in Galveston, Texas, announced publicly that all slaves were free, 2½ years after the Emancipation Proclamation. It has been a Texas state holiday since 1980 and is now recognized in 41 states. In addition to the repudiation of slavery, the holiday recognizes the "need for a deep heart change to a consciousness where we cherish and not just tolerate one another."

Closed Session Report

The closed session agenda listed five items:

  1. Anticipated litigation
  2. Labor negotiator conference - Teamsters Local 911
  3. Existing litigation - Collard WC claim
  4. Existing litigation - Heath WC claim
  5. Existing litigation - McCrumb WC claim

Attorney Duran said only two items were actually considered (items 1 and 2). The other items were too early and would be discussed at the next closed session council meeting. Item 1, "a litigation threat the city was received from a lawyer representing a hotelier in town over a TOT dispute," no reportable action. That's got to be the DHS Spa/Miracle Springs Resort TOT dispute.

Senior Center Update

Erin Begley made this presentation. The Family Service Association took over management of the Senior Center in March 2011. Hours at the center are Monday through Friday, 8 AM to 2 PM. The monthly average of clients served is up to 1,538. Six months ago that number was 1,044. They've upgraded the interior, painting, changing the lighting. The newsletter continues to expand. An advisory council has been set up. Satisfaction surveys of Senior Center uses showed a 4.7 (out of 5) approval rating in February 2012 and 4.8 on a much more recent survey. She shared photos from several events at the Senior Center. The winner of a Senior Center talent contest was a singer/yodeler - and why she was not present at this city council meeting was left unexplained!

Ms. Begley then introduced Bob Harper, a Senior Center participant, who expressed his support for the Senior Center. He said it's like Christmas every day there, and the food is like what you would get in a nice restaurant.

Ms. Pye, Councilmember Betts and Mayor Parks expressed their support for the Senior Center.

Mandatory Commercial Recycling Plan

Public Works Department Associate Engineer Daniel Porras introduced this item. California AB 341 requires that a "business (includes public entities) that generates four cubic yards or more of commercial solid waste per week or is a multifamily residential dwelling of five units or more shall arrange for recycling services" effective July 1, 2012. Mr. Porras showed a photo of one of the standard blue dumpsters that businesses use. That dumpster is 3 cubic yards. If a businesses has one of those and its being emptied twice a week, then they are at or above the 4 cubic yard threshold and must arrange for recycling. (Here's a photo a 3 cubic yard dumpster.)

Chris Cunningham from Desert Valley Disposal spoke next. He said a business could get one of DVD's standard blue 96-gallon recycling bin. There are 3 cubic yard recycling containers available, as well as larger sizes. A business can get a container up to the same size as their trash bin, and the first pick up per week is free. Special pre-arranged pickups can be done.

City Manager Rick Daniels took this opportunity to say that Mr. Porras, after much hard work, had passed his exams and is now a registered professional engineer.

Public Comments

Dot Reed spoke about respect. She said she was taught to respect others, especially those in elected or appointed offices. She also talked about courtesy, saying it made a big difference. She also looks forward to more recycling.

Bruce Montgomery talked Helene Nelson's upcoming Homeless Walk. The fundraising dinner, originally scheduled for June 27 has been rescheduled for July 25. The goal is to raise funds for a homeless shelter in Washington and for Roy's Desert Resource Center. Her overall goal is $200,000. Ms. Pye asked when and where on July 25. Mr. Montgomery said he wasn't sure of those specifics. Mayor Parks said the luncheon would be at Roy's. Mr. Montgomery said he thought it was $25. Councilmember Matas said it was a luncheon.

Mr. Montgomery also clarified that Grace Church is "Grace Church," not Grace Chapel or Grace Baptist.

Russ Martin, speaking as a director of the Mission Springs Water District, read this opinion piece in The Desert Sun:

Substantial and wise investment in water safety

Good news for Desert Hot Springs residents: The water district has scored a $10.3 million grant package to replace some of the city's septic tanks.

About 1,525 parcels, most in Desert Hot Springs, will get sewer service as part of the Mission Springs Water District program.

That means safer water in the city. It also means better roads, as many will be torn up and repaved during the installation process.

The money — one half grant and one half loan — marks the single largest infusion of nonlocal funding for sewers in the district's history.

The water district has come under fire from citizens who are fighting a rate increase that went into effect last year.

Maybe it's time for those residents to take another look at what they're getting for their money from the district, as this sewer project seems like a very wise investment.

He then went on to read the district's press release about their balanced budget which I have posted here. He thanked all of his fellow board members and congratulated General Manager Arden Wallum for the work to put together a balanced budget.

Mike Platt said Little League All Star games would start on June 30. On July 15 there will be girls softball sectionals. Little League will have a fireworks booth at Rite Aid starting on June 28. The fall ball season will be announced soon.

Voting Delegate For 2012 League Of Cities Conference

Mayor Parks said she would like to be the voting member with Mr. Matas as first alternate and Ms. Pye as second alternate. All three are active in the league. Mr. Betts moved for approval. Approved 4-0.

Budget For FY 2012-13

Here's the proposed budget, by fund. Here's the summary of revenue and expenses for the General Fund.

After an introduction by City Manager Daniels, interim finance director Steve Elam took over. He pointed out the part of the resolution that said the use of reserves is temporary and will be replaced when the two large sales tax items come in - that's $2.75 million from CPV Sentinel and $473,000 from the Board of Equalization.

Mayor Parks asked the council not to rehash all prior discussions, but to bring up new items, undiscussed items, unanswered questions.

Ms. Pye said that the council will be getting monthly budget statements.

Mr. Betts said he was not happy with the budget process. He said we won't be in a great place a year from now. He thinks using reserves is risky. He wants the city to try to get better bids on contracts. He said the Police Officers Association has already made sacrifices and shouldn't be asked to make more, but the salaries of higher administrators should be looked at.

He also listed items where he thought the money should be shifted to better benefit the community, including $75,000 for CVEP, $20,000 for a facilitator for the goals setting workshop,

Mr. Matas said the council had been presented with a list of options that would have balanced the budget. One of them was personnel cuts that would have reduced the police, but that was rejected because quality of life would not be preserved if that was done. The funds to replace the reserves are real and will be received. We have the ability to preserve city services now and should do so. He congratulated city staff.

Ms. Pye said this is a balanced budget, not a deficit budget.

Mr. Betts said that when expenditures exceed revenue, then you are in deficit. He thinks that the city could have reduced expenditures and taken less from reserves.

Mr. Matas moved for approval of the budget as presented by staff. Approved 3-1 with Mr. Betts voting against.

Fraud Prevention & Detection Policy

In the most recent audit the auditors included a recommendation "to consider a more formal, proactive approach to preventing fraud." The staff report for this city council meeting says...

The above recommendation is being made by auditors to virtually all public and private organizations in the wake of the past corporate accounting scandals and the resulting Sarbanes-Oxley Act. It in no way reflects on past actions or circumstances within the City of Desert Hot Springs. The City’s management response to the Management Letter recommendation was that it concurred and would adopt a formal fraud and detection program through the assistance of the City Council Finance Committee during FY 2011-12.

Here is the proposed Fraud Prevention & Detection Policy. It includes whistleblower protections.

Mayor Parks emphasized that this was a best practices recommendation.

Mr. Betts said it was nice to see this being addressed. He is concerned about situations where employees are treated as vendors. An employee may buy a significant number of items and then are reimbursed by the city. He thinks all purchasing should go through a purchasing agent. Mr. Elam said that practice is not in accordance with the city's current purchasing policy.

Ms. Pye moved for approval. Approved 4-0.

New Market Tax Credit Deal

This is part of the complex financing of the Health & Wellness Center project. There were only a few people in the room who might be able to fully grasp new market tax credits: Attorney Duran, another attorney from Meyers Nave, and Michael Busch. They all spared us an attempt to get us to understand.

The important thing is it gets us $4.6 million for the center. Michael Busch made it clear that all the documents were drafted by Meyers Nave attorneys, but they have been reviewed by "many, many other attorneys" including attorneys for the healthcare district.

Mr. Betts said the council must rely on staff expertise on this issue.

Approved 4-0.

Consent Calendar

Approved 4-0 without discussion:

  • An additional $21,200 for video services. The current video contract was awarded in August 2010. The rate is hourly, but meetings average $1,200 each. The additional $21,200 covers broadcasts in the current fiscal year and extends the agreement to September 2012. In July an RFP will be issued and a new agreement will come to the council September 4.
  • A 36-month lease for the hardware store (RDA property) at $4,700/month. One-year notice required. (Mr. Betts recused himself from this one).
  • The Treasurer's Report


Mr. Betts said he attended the CVAG CVCC meeting. They acquired a couple pieces of property, including one on Dillon Road near DHS. He also filled in for the Mayor on the CVAG E&E committee which was uneventful. At SCAG they discussed future transportation improvement programs. They are looking at "green rail" that would move cargo from ports on automated electric movers. He suggested DHS as the site for the warehouses to handle all these goods.

Mr. Matas said he attended an RCTC meeting where a billion dollar budget was approved. Nothing major in the Coachella Valley. Someone on the Parks Committee is working on a fenced dog park.

Ms. Pye said the economic development committee would meet next Wednesday at 6 PM and then go dark for July and August.

Mayor Parks pointed out that every high school in the valley has received Desert Sun coverage of their proms and graduations, except DHS High School. She wants to know why, and she hopes everyone wants to know why. [Kate McGinty can be reached at Kate.McGinty@thedesertsun.com]

City Manager Daniels said an arrest warrant has been issued for the owner of Hyundae Hotel. The place has been redtagged. He attempted to open it to guests over Memorial Day weekend with a revoked certificate of occupancy. It has no permits and no licenses.

The fire at the Flamingo Hotel is being investigated. City crews have secured the building. The owner has been notified that he must repair or demolish the burned part.

Chief Williams said that through the end of May 2012 all Part 1 crimes are down 26% from calendar year 2011.

Filed under Desert Hot Springs | permalink | June 22, 2012 at 09:04 PM


I think that when the contract with JAS for code enforcement was renewed they agreed to invest some in the city's data system at no charge to the city, but I don't think they dropped their price. End result was that the city got more.

One possible result of putting out contracts for re-bid is that when new bids come to the city council for approval, the city council may vote to stick with the current provider, even if they are not the lowest bidder. If somebody came in $50,000 cheaper than JAS, for example, would we go with the lower bidder and risk giving up the most productive contract we've got? JAS currently brings in hundreds of thousands of dollars more than they cost us.

Posted by: Ron's Log at Jun 26, 2012 9:52:23 AM

I got a good laugh at that. I'm not Karl, but I guess I agree with his position re: Mr. Betts. Ron is absolutely correct in his assessment of this situation. Putting graffiti, code enforcement, admin, etc. out to bid mid-contract is just asking for trouble. From what I recall, the contractor for code actually lowered their cost by 10% at the last renewal. Breaching a contract simply to find the "low cost leader" is foolish and short-sighted.

P.S. Sanchez missed the meeting because of "a training program that he had to attend,"?? And emailed the Mayor? So funny. Even when he's not there, he never fails to provide comic relief.

Posted by: Nate at Jun 26, 2012 9:42:19 AM

I've seen no indication that Nate is actually Karl (I assume Gabriel means Karl Baker). Nate's comments don't sound at all like Karl. But more important than that, Karl has no reason to be in the closet if he wants to leave a comment. He would put his own name on it.

Posted by: Ron's Log at Jun 25, 2012 4:35:51 PM

Ron, Thanks for correcting Karl's, I mean Nate's comments.

Your buddy, Gabriel

Posted by: Gabriel at Jun 25, 2012 4:06:44 PM

I can answer part of Nate's comment - almost all of the contracts include a provision to cancel with fairly short notice, usually 30 days. So the city wouldn't be in breach of contract. I would, however, expect that some of the contractors who had a contract for X years with the city would not enjoy having to re-bid for that contract. Some might consider it enough of an annoyance that they wouldn't re-bid. Others, seeing what we did, might not bid at all. OTOH, some starving businesses would see this opportunity and bring us a bid. If it's a small field of bidders and some businesses don't bid, the newer bids could actually be higher - in which case we stick with the existing contract and the only thing wasted is staff time and a little money.

Seeking a lot of new bids on existing contracts would create a new workload for staff. Other stuff might be delayed. How much staff time should be expended in pursuit of what could be a $600,000 savings, the estimate provided by Mr. Betts.

Posted by: Ron's Log at Jun 25, 2012 2:21:16 PM

Betts - why don't you just apply for the City Manager position? Obviously your years of cutting hair and acting as resident curmudgeon on the Council make you uniquely qualified to deal with large contracts. You want to put the top 20 out for bid right now? Correct me if I'm wrong, but wouldn't that open up the City to potential lawsuits, attorney fees, and/or penalties for breach of contract? Where exactly do you see $600k in savings? You make these bold statements, but have absolutely no data or facts to back them up.

Posted by: Nate at Jun 25, 2012 1:18:00 PM

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