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 CITY COUNCIL AGENDA ITEM NO. 19

Meeting Date: November 18, 2008

Subject/Title: Local Preference Program Ad Hoc - Subcommittee Update. 1) Receive report from the Subcommittee; 2) If Council desires further research into becoming a charter city, establish a new ad hoc subcommittee to examine specifically that issue; 3) Direct the new subcommittee to report back to the Council in early 2009, as part of the Council’s goal setting for 2009/10.

Prepared by: Bailey Grewal, Director of Public Works/City Engineer
Damien Brower, City Attorney

Submitted by: Local Preference Program Subcommittee (Council Members Richey
and Stonebarger)


RECOMMENDATION
1) Receive report from the Subcommittee;

2) If Council desires further research into becoming a charter city, establish a new ad hoc subcommittee to examine specifically that issue;

3) Direct the new subcommittee to report back to the Council in early 2009, as part of the Council’s goal setting for 2009/10.

PREVIOUS ACTION
On June 24, 2008, the City Council established the Local Preference Program Ad Hoc Subcommittee, consisting of Council Members Richey and Stonebarger, to explore local preference programs for the Civic Center and other CIP projects to create job opportunities for local businesses and employees.

BACKGROUND
On August 4, 2008, the Local Preference Program ad hoc Subcommittee (the “Subcommittee”) met and was provided with an overview of local preference issues, including the differences between general law and charter cities; a review of the constitutional challenges associated with implementing a local preference program; a status update on the City’s current local preference regulations; and a summary of other cities local outreach programs intended to promote the hiring of local employees and businesses.

Given the additional difficulties associated with a general law city implementing a local preference program, the Subcommittee asked staff to return with a brief overview on the costs associated with becoming a charter city as well as the possible advantages and disadvantages of becoming a charter city. In addition, the Subcommittee asked staff to research the success or failure of local outreach programs implemented by other cities.

On September 29, 2008, the Subcommittee met and was provided information related to some of the costs associated with becoming a charter city. By way of background, in California, there are two types of cities - general law and charter cities. The authority of a general law city is derived from the powers granted to it by the general laws adopted by the state Legislature and from the police power granted to it by the state Constitution. On the other hand, a charter city’s power is not defined or limited by the state’s general laws. Instead, with respect to municipal affairs, a charter city’s powers are defined by the city’s own charter, subject only to the limitations of the state and U.S. Constitutions.

There are two ways that a city charter may be adopted. The first involves a charter commission. The commission is elected by a vote of the residents and has the responsibility of drafting the charter. In the alternative, a city council, on its own motion, may draft the charter. In either case, the charter is not adopted until it is ratified by a majority of the city’s voters and any modifications to the charter would also require approval of the city’s voters. Most costs associated with becoming a charter city relate to the charter election or any necessary elections for charter modification. Such costs vary; however, depending on when the election is held. For instance the costs are much lower if the election is held during a regular election than if it occurs as a stand alone election. The following chart, based on information provided by the County Registrar of Voters, provides an estimate of election costs.

2008 Presidential Election $38,500

2008 Primary Election $50,000

2009 Special Statewide Election $71,500

2009 Stand Alone Election $160,000


In addition to election costs, there would be staff costs associated with drafting the Charter.

The Subcommittee was also provided with information on the advantages and disadvantages of becoming a charter city. The following list is not exhaustive, but provides a broad overview of the possible advantages and disadvantages of becoming a charter city.

Possible Advantages

• Greater local control on issues currently regulated by State statute
• Ability to exempt the City from Public Contract Code
• Flexibility in election procedures such as the ability to provide for mail-in elections
• Council voting flexibility (ability to pass measures on a 2/1 vote when only 3 members are present)
• Zoning does not need to be consistent with general plan
• Ability to levy greater fines for code enforcement violations

Possible Disadvantages

• Expenditures in drafting/election costs
• Some charters too specific – limited flexibility on day-to-day city operations
• If not regularly reviewed, charter can become outdated
• Modifications to a charter require voter approval
• Potential litigation
• Special interest ability to amend charter

In addition, the Subcommittee was provided information related to the success or failure of other cities local outreach programs. Current local outreach programs in place with other cities vary contracting preferences based on different factors, such as local business base, number of local employees and small business status. These preferences are typically “goals” for the contractors to meet when entering into agreements with the City for public projects. The success of the projects has been dependent upon the enforcement capabilities of the cities, with general law cities realizing the goals are not legally enforceable. A positive byproduct of local workforce promotion has been a database of available employees for contractor’s reference. A common theme heard from other cities, is that without legal means of enforcement, contractors will not voluntarily comply with goals. The program then only becomes as successful as the constant monitoring, oversight and assistance of staff.

Finally, the Subcommittee was provided the results of an employee and business residency survey of construction companies that have contracted with the City. The purpose of which was informational in nature to identify the company base and number of local employees of a sampling of construction companies that have contracted for public projects within the last few years. A summary of the results are as follows:

• 35% of the contractors surveyed are Brentwood based businesses
• 21.2% of that workforce are Brentwood residents
• 43.9% of that workforce are East County (Pittsburg and further east) residents

The number of Brentwood business licenses issued to construction companies was also summarized, the results included 1,008 licenses issued to construction related companies. Of the 1,008 licenses, 199 (19.74%) were issued to businesses located within Brentwood.

In considering the above information, the Subcommittee felt that although there were constitutional hurdles that still had to be overcome; Brentwood would have a better chance at implementing a local preference program as a charter city than as a general law city. In addition, given the greater local control enjoyed by charter cities, the Subcommittee was interested in exploring further the possibility of Brentwood becoming a charter city. As the Subcommittee recognized that further review of the charter city issue would exceed the authority granted them, they are requesting that the City Council consider establishing a separate subcommittee to examine the issue and direct the subcommittee to report back in early 2009, as part of the Council’s goal setting for 2009/10.

FISCAL IMPACT
None.


 
City Administration
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