FEDRAC MINS 02-26-2008
City of Federal Way
City Council
Financel Economic Developmentl Regional Affairs Committee
Tuesday, February 26, 2008
5:00 p.m.
City Hall
Hylebos Conference Room
MINUTES
Committee Members in Attendance: Chair Park, Member Duclos and Member Faison.
Council members in Attendance: Kochmar.
Staff Members in Attendance: Assistant City Manager Iwen Wang, Economic Development Director Patrick
Doherty, Information Services Director Mehdi Sadri, Deputy City Attorney Aaron Walls, Senior Financial Analyst
Mark Turley, and Deputy City Clerk Krystal Roe.
1. CALL TO ORDER - Chair Park called the meeting to order at 5:32 p.m.
2. PUBLIC COMMENT - Derek W. Purton addressed the Committee with concerns regarding the rate at which
the utility tax is increasing - especially as it relates to an inequality with wage increases and that it also does
not appear to be keeping pace with other taxing revenues. He further expressed concern about the internal
accounting checks and balances in place to ensure Proposition 1 utility tax revenue is applied only to legitimate
Proposition 1 expenses. Last, he stated that because of the high utility tax revenue, it should no longer solely
be applied for capital expenditures.
Chair Park asked Ms. Wang to speak to Mr. Purton's points. Ms. Wang explained the City's accounting
measures and summarized that the City meets all government accounting practices in regards to all issues -
including utility tax expenditures. All savings and costs from variable staffing levels are pro-rated percentage
wise for the Proposition 1 funds. When a savings is realized because the number of employees falls under the
number allowed by Proposition 1, that account realizes a savings. When staffing levels rise, the account
realizes a cost. Ms. Wang further explained that position vacancy fluctuations will continually occur due to
employee terminations, sick leave, etc. and that the fluctuations will impact the amount of actual Proposition 1
expenditures.
3. COMMITTEE BUSINESS
A. Approval of Minutes: December 4, 2007 FEDRAC Meeting - The Committee mjsjc to approve the
minutes as presented.
B. Legislative Update - Doug Levy, Legislative Lobbyist addressed the Committee via conference call and
gave a brief update regarding legislative issues, including:
Budget Funding: The Senate has approved $500,000 toward the Performing Arts Center in Federal
Way - by far one of the largest earmarks made this year. Mr. Levy noted that of the $4,000,000
Senate budget, Federal Way received one of the largest earmarks. Mr. Levy further reported Senator
Eide's support for the earmarked funding. To date, the House has not recommended funding for the
project and Mr. Levy requested that the City Council convey its importance to Representative Priest
and Miloscia. Councilmember Duclos agreed to contact both representatives on February 27 to request
their support for this important project as well as to request funding for the Dumas Bay Beach
Management District.
Transportation: Mr. Levy was pleased to report that the status of transportation-related legislation is
good and on track with Federal Way's goals. Both the House and Senate budgets have allocated
millions for the Triangle Project and also allocated pre-construction funding for the 1-5/509 and 1-
5/272nd projects.
Executive Session Meetings: The legislation requiring taping of City Council Executive Sessions died.
C. Small Business Development &. Outreach Activities - Mr. Doherty gave a brief history of the City's
partnership with the Highline Small Business Development Center (SBDq and remarked on the program's
success with Federal Way business owners.
He also stated that Lillian Yeh, Economic Development Assistant, has conducted weekly out-reach visits to
small business owners to provide them with brochures and information about the services available to
them through the SBDC, shares how the City functions, and the services available to them at City Hall.
Mr. Doherty introduced Zeg Siegl, Certified Business Advisor with the SBDC. Mr. Siegl spoke regarding the
positive partnership between the City and Highline and the success the program has recently experienced.
Ms. Jackie Muth, Mahrt & Associates, shared her positive experiences expanding her CPA firm with the help
of the SBDC.
D. Report on 2007 FCC form 1205 as filed by Comcast - Mehdi Sadri addressed the Committee and
described the process of setting cable rates. The City hired a consultant to audit the rate adjustment
proposal and found some areas of concern.
After studying the issue, it appears as if the cost of fighting the rate adjustment would be more expensive
for consumers than it would be to allow Comcast to use their rate calculations. Comcast generally charges
less than they are allowed to by law. If the City challenges the rate adjustment and prevails with the
consultant's rate, Comcast may decide to charge the maximum allowed by law which would be an increase
to Comcast customers.
Therefore, staff has negotiated a preliminary rate adjustment settlement with Comcast and will be coming
to Council for approval at a later date. The Committee concurred that staff should proceed with this issue
and bring it back to Committee/Council for final approval.
The consultant also found areas of concern that Comcast will not settle. Therefore, the consultant and
staff recommend that the City issue a rate order. The rate discrepancies between Comcast's figures and
the consultant's vary as much as $2.00 for some services. The Committee concurred that staff should
proceed with filing a form 1205 rate order for these rate adjustments.
Last, Mr. Sadri stated Comcast may be filing paperwork in the future to eliminate the requirement for a City
franchise agreement based on their opinion that there is effective competition for cable; the City will need
to formally file to stop their motion.
E. Sprint Franchise Amendment - Mr. Walls presented the staff report and noted the diagrams in the
document are initial concepts and not necessarily final plans. The project still needs to go through
permitting. Also, the private property owner would need to agree with the final proposal.
The Committee mjsjc to approve the proposed Ordinance and forward to full Council for first reading at
the March 4, 2008 City Council Meeting (Option 1).
F. Amendment of Right of Way Activities' Ordinance - Mr. Walls presented the staff report to the
Committee and noted the difference between construction-related right-of-way permits and right-of-way
activity permits (parades, demonstrations, community events, block parties, etc.). Mr. Walls highlighted
and reviewed the proposed changes to the ordinance - most notably that the group definition has been
increased to 25 persons and constitutional provisions have been made.
The Committee mjsjc to approve the proposed Ordinance and forward to full Council for first reading at
the March 4, 2008 City Council Meeting (Option 1).
G. Approval of November through January Vouchers:
The Committee mjsjc to approve the vouchers as presented and forward to the March 4, 2008 City Council
meeting.
H. 2007 Year End Financial - Mr. Turley presented the staff reported and highlighted key figures. He
explained the Police overtime was due to reduced officers available and that staff will be looking to adjust
this number in the next budget cycle to reflect a more realistic figure.
He also remarked that the Community Center is still about 27% below its anticipated revenue amount and
staff still anticipates a higher than estimated gap between expenditures and revenue. Staff is working to
reduce the gap without negatively impacting current users.
I. 2008 Carry Forward Budget Adjustment Ordinance - Ms. Wang presented her staff reported and
highlighted the requests not previously brought forward to Council. The Committee discussed the long-
range budget projections, anticipated economic changes/fluctuations, and major budget adjustments which
have set the City in a favorable status.
4. OTHER - None.
5. FUTURE AGENDA ITEMS - Two items need to be brought forward: $25 million LIFT plan and neighborhood
districts.
6. ADJOURNMENT - Chair Park adjourned the meeting at 7:02 PM.
d~~st:
Dini Duclos
Committee Member
-0?CUf:,ecl-
Eric Faison
Committee Member