Session 06-28 a Special Meeting of the Homer City Council was called to order on November 20, 2006 at 7:01 p.m. by Mayor James C. Hornaday at the Homer City Hall Cowles Council Chambers located at 491 E. Pioneer Avenue, Homer, Alaska and opened with the Pledge of Allegiance.

PRESENT: COUNCILMEMBERS: HEIMBUCH, NOVAK, ROBERTS, STARK, WYTHE

ABSENT: SHADLE (excused)

STAFF: DEPUTY CITY CLERK JOHNSON

CITY MANAGER WREDE

FINANCE DIRECTOR HARVILLE

LIBRARY DIRECTOR HILL

PUBLIC WORKS DIRECTOR MEYER

Councilmember Shadle requested telephonic participation but was unavailable when called.

Department Heads may be called upon from time to time to participate via teleconference.

AGENDA APPROVAL

(Addition of items to or removing items from the agenda will be by unanimous consent of the Council. HCC 1.24.040.)

No item may be added.

The agenda was approved by consensus of the City Council.

PUBLIC COMMENTS UPON MATTERS ALREADY ON THE AGENDA

Public may comment on any matter on the agenda except Public Hearing Items: Ocean Drive Loop Peterson Addition Sewer Improvement District, Ordinance 06-61 and 06-61(S) and Budget.

Jane Tollefsrud, city resident, expressed her thanks for the denial of the utility permit to four members of the Country Club Estates. The matter is now at the Superior Court level as Attorney Gordon Tans has filed a reply in support of a dismissal or stay. Mrs. Tollefsrud believes the City is within its rights to deny or revoke the permit, as AS 42.05.251 includes conditions for municipalities to make exceptions to utilities, permits and rights. City Manager Wrede’s letter to HEA explains the reasons for the exceptions in great detail. It is her thought if the case needs to be argued further it should be put before the State Regulatory Commission instead of a lawyer hired by the utility company.

CONSENT AGENDA

(Items listed below will be enacted by one motion. If separate discussion is desired on an item, that item may be removed from the Consent Agenda and placed on the Regular Meeting Agenda at the request of a Councilmember.)

A. Memorandum 06-182, from City Clerk, Re: Request for Executive Session Pursuant to AS § 44.62.310(C)(1), Matters, the Immediate Knowledge of which would Clearly have an Adverse Effect upon the Finances of the Government Unit and for a Discussion of Matters Protected by the Attorney-Client Privilege. (Ocean Drive Loop Bluff Erosion Control Project (Seawall) and the HEA/Country Club Estates Case.) Recommend approval and request that Council conduct this session prior to final action on Ordinance 06-60(S)).

NOVAK/WYTHE – MOVED FOR THE APPROVAL OF THE RECOMMENDATIONS IN MEMORANDUM 06-182.

There was no discussion.

VOTE: YES. ROBERTS, WYTHE, STARK, NOVAK, HEIMBUCH

Motion carried.

PUBLIC HEARING(S)

A. Ocean Drive Loop Peterson Addition Sewer Improvement District.

There was no public testimony and the public hearing was closed.

B. Ordinance 06-61, Of the City Council Amending the FY 06 Operating Budget by Transferring $1,684.50 from the Sewer Department’s Tools and Equipment Line Item to Public Works Fleet Reserve Fund, Authorizing the Purchase of a Sewer Jet from Denali Sewer and Drain of Anchorage, Alaska, Sole Source, in the Amount of $51,684.50, and Authorizing the City Manager to Execute the Appropriate Documents. City Clerk. (First Reading and Introduction October 23, 2006, Public Hearing and Second Reading November 20 2006.)

B.1. Ordinance 06-61(S), Of the City Council Amending FY 06 Operating Budget by Transferring $1,684.50 from the Sewer Department, to Sewer Reserves, Au Authorizing the Purchase of a Sewer Jet from Denali Sewer and Drain of Anchorage, Alaska, Sole Source, in the Amount of $51,684.50, and Authorizing the City Manager to Execute the Appropriate Documents. City Clerk. Fiscal Note: Transfer from Account 200.500.5990 Sewer Department, to Account 215-379-4992 Sewer Reserves in the amount of $1,684.50 Addition to the existing $50,000.00 153-383 to 215-379. (Contains amendment requested by Finance and approved by the City Manager.)

There was no public testimony and the public hearing was closed.

Mayor Hornaday called for a motion to adopt Ordinance 06-61 by reading of title only for second and final reading.

HEIMBUCH/WYTHE – MOVED TO ADOPT.

There was no discussion.

STARK/WYTHE – MOVED TO AMEND BY SUBSTITUTING ORDINANCE 06-61(S) BY READING OF TITLE ONLY.

There was no discussion.

VOTE: YES. (motion as amended) NON OBJECTION. UNANIMOUS CONSENT.

Motion carried.

C. BUDGET FOR 2007

Barbara Howard, city resident and Parks and Recreation Commissioner, complimented city staff for their hard work in making the 2007 budget easy to understand. The City’s webpage is outstanding and represents the City well. Mrs. Howard requested funding for Parks Day in the amount of $1,000, stating the event will be well attended and appreciated by the residents of Homer.

Nancy Lord, city resident and Chair of Library Advisory Board (LAB), said the new library is a great success. All spaces are being utilized, the children’s program has increased and it is a busy place with young people after school. The library staff is excellent; they are hard working and made the transition well. To continue with essential services, one new position is vital, as the library is five times larger than the old one and usage has doubled.

Mayor Hornaday questioned Finance Director Harville on library budget items. The library is asking for $150,000 more than last year to cover employee fees, increased operating expenses and debt payments.

Michael Hawfield, non resident representative on the LAB, encouraged the Council to support the City Manager’s budget recommendations. He advocated for a new staff person that would connect free volunteer labor resources to provide increased and enhanced projects.

Joy Steward, Director of the Homer Foundation, asked for funding for Homer’s non profit community. Since 2000 the Homer Foundation has helped distribute $176,000 City dollars into the non profit community with no fees involved. She welcomed Councilmember Roberts, encouraged funding on the endowment fund and distributed annual reports from the foundation.

The public hearing was closed.

ORDINANCE(S)

A. Ordinance 06-60(S), Of the Homer City Council Amending the FY 2006 Operating Budget by Appropriating $20,000.00 to the Public Works Reserves Account for the Purpose of Addressing Maintenance and Repairs on the Ocean Drive Loop Erosion Control Project (Seawall); and Stipulating that a Proportionate Share of these Funds shall be Repaid by the Property Owners in the Assessment District Through Special Service Area Property Taxes or Other Payment Method Approved by the Council. City Manager. Fiscal Note: Appropriating $20,000 from the General Fund Reserves, Account Number 100.000.1000 to the Public Works Reserves, Account Number 156.369.4992. (First Reading October 9, 2006, Public Hearing and Second Reading October 23, 2006, Second Reading postponed on October 23, 2006 to November 20, 2006. Main motion is on the floor as postponed on October 23, 2006.)

Mayor Hornaday recessed to Executive Session at 7:29 p.m. and reconvened the Special Meeting at 8:37 p.m.

Motion on the floor: HEIMBUCH/WYTHE - SO MOVED FOR THE ADOPTION OF ORDINANCE 06-60(S) FOR SECOND AND FINAL READING BY READING OF TITLE ONLY.

There was no discussion.

VOTE: NO: STARK, NOVAK, HEIMBUCH, ROBERTS, WYTHE

Motion failed.

Councilmember Novak stated the Council took the advice from the attorney on the Seawall.

B. Ordinance 06-62, Of the City Council of Homer, Appropriating Funds for the Calendar Year 2007 for the General Fund, the Water - Sewer fund, the Port/Harbor Fund, Debt Funds, and Capital Reserve Funds (Conditional Expenditures). City Manager. Fiscal Note: General Fund $10,521,747.00, Water-Sewer Fund $3,343,780.00, Port/Harbor Fund $3,275,528.00 Capital Projects $2,519,372.00, Internal Service Funds $1,524,000.00, Total Expenditures:$21,184,427.00 (First Reading and Introduction November 20, 2006, Public Hearings November 20, 27 and December 4, 11 2006, Second Reading December 11, 2006.)

B.1. Resolution 06-Number to be assigned, Of the City Council of Homer, Alaska Extending the City Attorney Contract with Perkins Coie for the Period of January 1, 2007 through December 31, 2007 in the Amount of $7,650.00 per Month for Forty Five Hours, Increasing the Hourly Rate from $185.00 to $200.00 and Authorizing the Mayor to Execute the Contract. City Clerk.

B.2. Resolution 06-Number to be assigned, Of the City Council of Homer, Alaska Revising Certain Portions of the Port and Harbor of Homer Terminal Tariff No. 600. City Clerk.

Note: At this time there are no water, sewer or other fee schedule changes.

NOVAK/HEIMBUCH - MOVED TO INTRODUCE ORDINANCE 06-62 BY READING OF TITLE ONLY.

There was no discussion.

VOTE: YES. NON OBJECTION. UNANIMOUS CONSENT.

Motion carried.

After attending the AML (Alaska Municipal League) conference Councilmember Heimbuch has concerns in sufficient funding for operating expenses. He suggested adding $100,000 to the depreciation account and $100,000 for operating expenses. Discussion ensued as to the method Council is to make changes to the budget. Change request forms will be distributed to councilmembers for their input. Although an unbalanced budget from one meeting to the next is to be expected, the budget must be balanced when approved.

City Manager Wrede noted the Council passed a resolution providing direction to administration for maintaining healthy depreciation reserve accounts. When putting the budget together they were cognizant of the resolutions, but also of the competing interests and public input. They were not able to increase the contribution to depreciation reserves and still include the other expenditures.

Finance Director Harville noted the depreciation reserves were increased by $555,000.

Councilmember Stark believes if the City can make it through to the middle of next year the Governor stated $.5 billion will be allocated to PERS and TERS and spread among the state. AML is proposing a revenue sharing program of $175M and $1M will be coming to Homer prior to the middle of the fiscal year. Councilmember Wythe responded that punting is not what the Council is here to do. They are to create financial stability for members of the community and should a windfall be received it would be after the fact that it would be decided how to be spent. It is imprudent to spend before you receive, and the Council was elected to develop a reasonable budget.

Mayor Hornaday has not determined any decision on the part of the Legislature. The PERS money would not be given directly to the City; it goes to pay off some of the debt. It would loosen up money in the City’s budget. With a new governor and new combination in the Senate relying on anything is uncertain. Councilmember Wythe added if PERS money is obtained it could not be reallocated to other things, as a reserve account is already committed.

When asked about adding money in for operating reserves, Ms. Harville said the auditors have asked for six months of operating fees in the fund balance. It should be considered when the auditors ask for it.

Mayor Hornaday referenced the earlier executive session, stating Councilmember Beth Wythe was excused from HEA discussions.

PENDING BUSINESS

A. Memorandum 06-184, for Mayor and Council, Re: Adoption of the Decision on Code of Ethics Complaints Filed Against Councilmember Doug Stark.

Mayor Hornaday noted the lack of quorum at tonight’s meeting after Councilmembers Stark and Novak are excused from the proceedings. Mayor Hornaday ruled Memorandum 06-184 will be continued to the November 27, 2006 meeting.

RESOLUTION(S)

A. Resolution 06-153, Of the Homer City Council Authorizing the City of Homer Participation in House Bill 161, a Bill Enacted to Allow Reemployment of Individuals who are Currently Receiving a Retirement Benefit from the Public Employees' Retirement System (PERS) and Adopting the City of Homer Retiree Rehire Policy. City Manager.

Memorandum 06-183, through City Manager, as backup.

Mayor Hornaday called for a motion for the adoption of Resolution 06-153 by reading of title only.

HEIMBUCH/NOVAK – MOVED TO ADOPT.

There was no discussion.

VOTE: YES. NON OBJECTION. UNANIMOUS CONSENT.

Motion carried.

B. Resolution 06-154, Of the Homer City Council Condemning Councilmember Doug Stark for Unethical Behavior.

In the absence of a quorum with Councilmembers Stark and Novak excused, Mayor Hornaday ruled Resolution 06-154 will be continued to the November 27, 2006 meeting.

COMMENTS OF THE AUDIENCE

Sandy Stark, city resident, commented on the alleged ethics violation against her husband Councilman Stark. It is her belief the incident in question was completely inadvertent and was not planned. Any of us are capable of making mistakes and need to recognize them and apologize. She hopes to see the Council function as a good body working for the citizens of Homer.

Frank Griswold, city resident, questioned the cost on the ethics probe for Councilman Stark. His thought is Mr. Stark should voluntarily reimburse the City for all expenses incurred, rather than imposing the financial burden on innocent taxpayers. Since the ethics code was adopted by resolution penalties cannot be enforced. It should be enacted by ordinance and made part of the City Code and the political activity section should be expanded to apply to elected and appointed officials. An unethical council will impose restrictive filing fees and limit standing for those filing ethics charges like the 2005 council did when it enacted Ordinance 05-17(A) regarding appeal procedures. Mr. Griswold questioned the necessity of an executive session, stating it was a violation of the Open Meetings Act that says litigation should be discussed in front of the public. The public has been kept in the dark about the Seawall project and now about the Country Club Estates project. He questioned why Councilmember Wythe was not allowed to participate in the executive session when she was ruled without a conflict of interest in the proceedings.

COMMENTS OF THE CITY ATTORNEY

City Attorney Tans was not present.

COMMENTS OF THE CITY CLERK

Deputy City Clerk Johnson had no comments.

COMMENTS OF THE CITY MANAGER

City Manager Wrede had no comments.

COMMENTS OF THE MAYOR

Mayor Hornaday had no comments.

COMMENTS OF THE CITY COUNCIL

Councilmember Wythe commented on public education regarding city finances. A coffee table slot on KBBI was requested for December 6^th. Question of the Week materials could include the public’s feelings on reduction of services or continuation of property taxes. It will heighten community awareness as to who the City is. A community meeting could be held as an informal session for the public to ask questions of the Council as to finances and the budget. Editorials for the newspapers could be written and a generic cost revenue information sheet with dollar amounts relating to budget could be made. Mrs. Wythe believes there is a disconnect between who the government is. Public education on a city level would help members of the community recognize when taxes are collected they are building reserve funds that will plan for the future financial stability of the city.

Councilmember Stark clarified any misunderstanding from earlier discussions that the budget will be balanced on 12/31/06. Additional money may come our way. While in Juneau he talked with Legislators, the Governor and the Municipal League.

ADJOURNMENT

There being no further business to come before the Council, Mayor Hornaday adjourned the meeting at 9:12 p.m. The next Regular Meeting is scheduled for Monday, November 27, 2006 at 7 p.m. and the next Committee of the Whole is scheduled for Monday, November 27, 2006 at 4 p.m. All meetings scheduled to be held in the Homer City Hall Cowles Council Chambers located at 491 E. Pioneer Avenue, Homer, Alaska.

________________________________

JO JOHNSON, DEPUTY CITY CLERK

Approved: _______________________