The ninth meeting of the Financial Review Team (FRT) was convened by Chair Steve Magyary at 7:47 pm at the El Cerrito Open House Senior Center.

Steve M. again asked that all questions be submitted to City/RDA Staff through him or George A. This is necessary to prevent confusion of Staff and to keep our efforts focused on our priority items.

The following individuals were present:

• Linda Blum
• Larry Damon (arrived about 8:30 pm)
• Anne Delehunt
• Evelyn Kiersen
• Peter Loubal
• Steve Magyary
• Al Miller
• M. Selph

1. In regards to the Agreement between RDA & City dated 3/6/91 signed by City Manager & RDA Manager, but no Council members/RDA members. Steve talked with Gary P. and was told that there was a City Council resolution concerning this agreement. A copy will be provided.
2. In regards to the subject of who decides where any budget surplus carry over is put. Staff decides where it should go and puts it there. The Council, in effect, approves this action when they conduct the mid-year budget review. this seems rather "loose" and the FRT needs to review this practice.
3. In regards to the discussion on the EDEN System. Steve reported that the contractor is sending him information about the Windows update. The new revision won't be available until next year sometime and may be expensive.
4. Concerning Web capability of EDEN System. The new revision will have improved HTML reporting capability to ease posting to web sites. We could actually do it now, if we wanted to and had the staff to do it.
5. RDA loan repayment options. Steve has talked to Elisa T. and reviewed the options we have been discussing. She made some useful comments and will review them further and see if she has any more. She offered that the $20K figure we assumed for the "holding pattern" option was too low, since the annual audit required by state law costs $24K. She also thought that 2% TIR growth is too conservative as she expects 5% next year. She thinks 3% is more reasonable. She also corrected some personnel figures. These discussions also revealed that the $300K RDA owes county may be negotiable to defer or forgive.
6. Steve announced that he had just received Howard S.'s report regarding the City/RDA agreement on loan repayment. This led into a general discussion on the E.I.R. for the Plaza Wilton-Terranomics project and the fact that the City paid 2 invoices from the E.I.R. contractor for this work before receiving the money from Wilton-Terranomics, the developer. The question of whether this amount of about $120K is part of the RDA debt to the City was raised.

Steve M. suggested that the FRT needs to review the benefits package provided to city employees along with the salary review. He suggested we invite a staff person to come to a future meeting to explain them to us, possibly the 9/98 meeting. It was suggested that the City Manager was the best person to invite. Steve agreed to talk to Gary P. about this. Al M. suggested that , if Gary P. does come, he should also address the question concerning the arrangement between the City and the City Manager concerning his residence. Anne D. asked that he also address the method used to evaluate performance of city employees.

This led into a general discussion on employee/manager accountability for questionable performance or judgment. As an example, the fact that the City paid 2 invoices from the E.I.R. contractor for this work before receiving the money from Wilton-Terranomics, the developer, was brought up again.

Steve then read portions of Howard S.'s report. Steve will provide copies to all FRT members. We went through a preliminary review of the document. In general, Howard's position is that the agreements are basically whatever the Council/RDA want them to be. Back dating actions, changing interest rates, forgiving loans are all allowed by the state law that set up RDAs.

A general discussion on where do we go from here to generate a commitment from the Council/RDA to not arbitrarily change any agreements, back date actions, forgive loans, etc., without acceptable public check and balance. One suggestion was a joint study session between the CotW and the RDA/Council to review and discuss this problem. Anne D. commented that there are other issues that need study sessions. Some examples are Budget presentation style and procedures; amount of potential deficit; Capital improvement planning; and priority of city services.

Steve ended this discussion by urging us not to draw any conclusions from the report until we have had a chance to read the complete document.

Steve said he would invite Gary P. to attend the 9/9 meeting to address the following:

1. City employee benefits package;
2. City/City Manager residence agreement;
3. Authority for City/RDA Staff to change administratively the % of repayment for City Staff support to RDA; and
4. Explain how City paid for Plaza E.I.R. before getting money from the developer, Wilton-Terranomics.

Next meeting was set for Wednesday, September 9 at 7:30 pm at The Open House Senior Center (Subsequently changed to the Fairmont Clubhouse).

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