City Council - workshop

Over here on my end.

Okay, I got it. Go on. Just to recap, Monterey Park is one of about 500 cities in the state of California. And like most of those cities, it provides similar services, public safety, infrastructure, and other kinds of amenities like parks. Specifically in the city of Monterey Park, we have a police station with 130 employees. We have three fire stations with over 60 employees. The city maintains nearly 120 miles of streets and roads just in the city of Monterey Park, if you can believe it, and probably about an equal amount of other kinds of infrastructure that we don't see, water pipes, sewage pipes, et cetera, storm drains underneath the roads. The city maintains a library. There are 14 parks that comprise over 100 acres. There's a public pool. And this is not everything that the city does, but it's a lot of what we are talking about when we talk about general city services. And we wanna talk a little bit about those and some of the city's goals, really, which are built around a lot of these services. The goals is adopted by the city council for the year 26 and 27, it's a fiscal year. This year's goals are to ensure public safety, to maintain, build, excuse me, and modernize infrastructure. to maintain the stability of the city's fiscal and human resources, its budget and the people that provide these services, to expand access to community resources and services, to strengthen our local economy and enhance housing opportunities, and then to enhance public communication and civic engagement. And we thank you for being part of that goal by joining us tonight. So what are some of the city's recent accomplishments on these goals? Right. So I mentioned there are 120 miles of streets and roads. City has actually resurfaced 73 miles of those city streets. But it's a little bit better at math. I tell you what that percentage is, but it's definitely more than half and doing pretty good. The city has also replaced water and sewer mains and made improvements to traffic signals and crosswalks. City was recently awarded nearly $6 million in grants for various city services and programs, and has been making improvements to parks and other amenities. The city is also very focused on public safety and trying to maintain public safety in the community and the services that support those. But to give you a bit of a sense of the scope and scale of what that entails in the city of Monterey Park, on average, there are more than 5,500 calls to 911 in Monterey Park each year for medical emergencies, things like heart attacks, strokes, car accidents, and others. And that's actually the bulk of the calls to 911 for the fire department. That's about 83% of the 911 calls to the fire department are for such medical emergencies. And that number has been going up recently. It's up by about 10% in the last five years. There's also over 50,000 calls, 53,000 calls for service to the police department every year. That included reports for nearly 1,500 property crimes. That's things like auto thefts and burglaries. And I would say that both sides of this equation, the police and the fire side, these are trends that are affecting not just Monterey Park, but cities kind of all around LA and all around Southern California are seeing increases in calls for service. We have more people and just a higher demand for these kinds of services. So to meet those challenges, the city is responding and they've added four additional police officers since 2022 and now has over 80 sworn police and is looking to budget, I think, for a couple more. The city also created a deputy fire chief position to try and support fire services and is also planning to maintain current staffing levels across all its other departments throughout the city to try and maintain those service levels. The city also, as I mentioned, it has a lot of physical assets, infrastructure that is in need of ongoing repair or modernization. Road engineers, independent engineers have recently reviewed the condition of our city streets and found that one third of the streets and roads in the city of Monterey Park were in just fair, poor, or even very poor condition. However, as I mentioned, as we have updated those resurface those streets, the 73 miles of resurfacing, that has improved that rating to good citywide, and future investments are planned to try and maintain this rating. The city also must protect public safety and comply with federal laws that require replacement maintenance of aging pipes, some of which can be several decades old. And there are also many buildings in the city, community centers, neighborhood parks, et cetera, that are in need of essential and ongoing health and safety repairs, ADA accessibility, and then just, again, the general good working order of the facilities so that they remain safe. The city is also working on housing. That's another key goal in its housing element, which is kind of the basic plan for how it plans to provide housing for a growing community. That was approved in March of 2023, and you can see here a number of new developments coming to town by virtue of that. And I mentioned that supporting the local economy was also a goal. And just in the first quarter of this year, from January to April of 2026, the city's approved over 100 new businesses, over 113 new businesses that includes things like restaurants, coffee shops, gyms, and more. But as we start to look at the city's budget, and it is kind of budget season for the city of Monterey Park, the new fiscal year is set to start here I think in just a couple days on July 1. The city's monitoring a number of issues that could strain its revenues and its resources for these services. That includes things like national economic issues, tariffs, inflation, the kinds of trends that are affecting all of us that we think about every day, these affect the local government too. And that works on the cost side as well. A lot of the costs for provisioning things like public safety and maintaining our streets and roads, those are going up. So just like our businesses are seeing rising costs for fuel, utilities, labor, just like we at home are experiencing rising costs from inflation that's affecting the local government too and the city's trying to look for ways to try and maintain its service levels and its resources to try and maintain those and I think to tell a little bit more about that I'm going to have Martha speak a little bit to the current city budget and Martha I'm happy to advance the slides for you as we go okay thank you so

Hi everybody again. So on May 27th, we presented to council and the public through a budget workshop, the fiscal year 26-27 budget. And on June 17th, council adopted that budget. The budget for fiscal year 26-27 is $188.2 million. 60% of those expenditures are are for dedicated funds. And then the other rest, the other 40% is from general fund monies. The general fund monies are 77.8 million. To tell you a little bit about dedicated funds, dedicated funds are specific funds that are legally required to be used for specific purposes. So for example, when we collect water, water is specific to water services, water supplies. When we collect sewer, the same thing. Streets and roads, we have some propositions, some measures when that revenue comes in, it's specific to streets and roads. So those are dedicated funds and about 60% of our budget comes from dedicated funds to pay for those services supplies that are related to dedicated funds. So next slide, please. So we're going to focus a little bit more on the general fund. The general fund, we're allowed to use a little bit more. The council can use it for just about anything. The general fund, most of it goes to police and fire. If you see here on this pie chart, police and fire are about 60% of our budget. So they take up most of the general fund budget. And the rest is for other general fund services and supplies that the other departments have to also pay bills to pay. The next slide, please. Okay, so here's how the revenue comes in. Earlier, I was showing you how we expense the budget or general fund and how it's divided between departments. This is how the budget revenue comes in. Most of our revenue comes in from property tax and sales tax. And that's also about 59, 60% comes from specifically from property tax and sales tax. The rest of it comes from other types of services. For example, service charges. Those are the kinds of charges that when somebody uses a pool and they pay $3, $4 to use a pool, that is part of service charges or when they rent the facility. We also have transient occupancy tax, which is something that we're going to be talking a little bit more in later on in the presentation. We also have business license tax that was recently in 2024 voters approved a methodology change that allow us to earn an additional 1 million per year. And then we also have utility user tax that, that also generates about 5% of revenue of general fund revenue. We're going to, And then let's talk a little bit more about how that money comes to be. Next slide, please. So property tax is an annual levy and is based on the value of the land and structures. Property tax comes to nearly 35% of the city's own source of revenue. Sales tax is what's called Bradley Burns, the 1% that we get. So even though the city collects 10.5%, we only get 1% of that 10.5 for Bradley Burns. And then we get an additional 0.75 or three quarters cent for Measure MP that was passed by the voters in 2020, 2022. And that Measure MP, we generate about 9.2 million a year from Measure MP. on top of about the 10 million that we get from the Bradley Burns 1%. The utility user tax, I'm sorry, the utility user tax is another tax that is charged. The city hasn't been changed in many years. The residents pay 3% and commercial users pay 5.5% and it's for electric, gas and telephone services.

Next one.

Business license tax, again, we took it to the voters and the voters in 2024 passed Measure LG, sorry, Measure BE. Measure BE generates about an additional 1 million and that's changed the structure. We used to charge, a business license tax used to be paid based on employees and now it's based on gross revenue so that it evens it out and it makes it more equitable among the businesses. And our next one, which when it goes back to when Rob finishes this presentation, we're going to talk a little bit more about TOT. TOT is a hotel tax. It's kind of like a, you know, it's a hotel tax. And it's also a short-term rental tax. So it's anything when you're staying overnight somewhere using a bed. This is imposed on the rent of hotels, motels in the city. The current tax is 13%, and that was approved by Measure LG, by the voters, Measure LG in 2024. This 13% also applies to short-term rentals such as an Airbnb. Next slide. Okay, so I'm going to pass it back to Rob, who's going to talk about our budget outlook and talk a little bit more about TOT. Okay.

Thanks. And so, you know, as Martha's kind of walked through the current condition of the budget, as I alluded to, there are challenges that the city is trying to address and plan for in future years. And so with the cost for maintaining public safety and various services continuing to rise, the city's looking as an option, the potential to make changes to the hotel tax, the transient occupancy tax or TOT. Any funds from revising that would support the city's general fund that Martha walked through and that again funds a lot of services we've been talking about this evening, 911 response, keeping our public areas safe and clean, repairing streets and potholes and anything that's part of the city's general fund. and so just a little bit more on the hotel tax so again what we're talking about is a tax that people pay when they come and stay in local hotels or short-term rentals which you might refer to as airbnb in the community it's generally not paid by residents unless you are going to stay doing a staycation monterey park and staying at a local hotel A resident would not pay this tax. There'd be people coming to visit town who pay that tax, and it's a way for the city to try and recoup costs for folks that are coming and utilizing city services. They drive on our streets and roads. They may visit our parks. God forbid they may have an issue and they would need our public safety or 911 response, but this is a way for the city to recoup the cost of servicing those folks. The current rate in Monterey Park is 13%. That means for every $100 you pay in your hotel room rate, your nightly rate, you're going to pay a 13% tax on that. Many kind of similar cities and surrounding cities do charge higher rates. Monterey Park is not the lowest in the county, but Diamond Bar and Artesia charge 14%. Pasadena has an effective rate of 17%. And the should make clear that the tax also applies to, again, short term rental operators like Airbnb, like VRBO. Sometimes we just say Airbnb is a shorthand, but it's really all of these short term rental operators. They have to collect those taxes and pay those taxes as well. However, a recent study found that there's nearly 300 of these short-term rentals, Airbnbs and the other services that are operating within Monterey Park, but only 84 are currently registered with the city and paying that transient occupancy tax, less than a third of them. And it's important for the city to try and keep these facilities regulated and permitted. Unregulated short-term rentals, they can create health and safety concerns. They can turn into what they call party houses where people are renting them out and throwing big parties in neighborhoods. That can create noise, parking, nuisance impacts. And it's just important that the city knows that these... these facilities are safe for people to come and stay. Unfortunately, the city doesn't currently have resources to go out and monitor and enforce those 200-odd unpermitted facilities. So to that end, the city council is considering a measure that would increase or propose an increase to the voters, I should say, of the hotel tax, the TOT, by 1% for hotels, but by 3% for these short-term rentals like Airbnb. This would be a locally controlled general tax, which means that all of the funds collected go into the city's general fund. They can't be taken by the state of California or utilized by the county of LA for services outside the city. All of it has to be spent in the city. And again, it's generally not paid by the residents, but by the people coming and staying in these hotels and Airbnbs. The process for this is first to gather community feedback, and that's part of why we're hosting this meeting this evening. Hang on, maybe somebody in the waiting room. As well as, sorry, hang on a second. um we're trying to gather community feedback on this and then uh the next step in the process would be that uh the city council would have to discuss this and a super majority of them four of the five members would have to vote to place a measure on the ballot and then it would go the voters um you know conceivably in november of this year would have to be at a regular election And it would go on as measure A or measure B or whatever letter it's assigned. And then a majority of the city's voters would have to approve it, 50% plus one. And so with that, that's our presentation for the evening. We are, I think, happy to answer questions to the degree that any of you have them. And I know a couple of folks joined kind of midstream or later in the presentation. We are recording this and we'll post it on the city website. But I think we'd be happy to answer questions as you have them.

Absolutely, and I do just want to note that we have Shawn Aigo, our public works director, joining us as well. So happy to answer any questions about the presentation or any of the services or the budget that we discussed.

I have a question. Yeah, again, my name is Will. I've been living in Monterey Park for 30 years and as a long term resident of Monterey Park, I noticed that This is a city, there is a lot of immigrants coming in. And also we can see there are some small notes posted on the electric poles saying that you can, they offer some beds or even the rooms for the new arrivals, new immigrants. And I'm not sure, is this kind of things still allowed? The first question. Second, if it is allowed, does that fit into the TOT as Rob and Martha was talking about? Thank you.

Well, I can take a stab at that. Great question. Thank you for that. So I've seen those same notices on polls. I'll use my Google app to translate kind of what it is because often they're in Chinese. And to answer your question, it would it would depend while having a roommate or renting out a room in your house is is totally on the up and up. you may be, and if that's what's going on, there's no issue with that. But sometimes I think what you're referring to sometimes is what we see called something like boarding houses. So that would be an unlicensed, unregistered short-term rental or rental, right? And there are ordinances in our city code that prevent that. And so if you do suspect that that is going on in your city, neighborhood, you can definitely call that in and our code enforcement team will go and check that out. To add a little bit of nuance to your question, these boarding houses, even if they're not illegal, they are still responsible for paying short-term rental charges. So it's a bit of a kind of a loophole in the law that would allow us to, while we're doing our enforcement, go after these establishments financially for any unpaid short-term rental. Does that answer your question, Will?

Yes, very well. Thank you.

Thank you for that.

Any other questions?

Going once. If you do have a question, we're happy to take it, but I just want to take this opportunity to thank everyone for spending some time with us this evening, as I mentioned. recording of this online if you missed any portion of it. And there's some additional resources available on the city website. Do we have any last questions here on our way out? Diana, is there anything that we forgot to cover that you feel like we ought to before we conclude?

I don't think so. I do want to note that this is the last engagement that we have planned, but as Rob mentioned, we've done a few before and we will be recording this and putting this on our website. If you do want to go back to it or anything comes up question-wise afterwards, please contact either Martha or myself. We're happy to chat over the phone or via email.

If you have any more budget, if you have any budget questions, I'll please feel free to give me a call and I can explain a little bit better or in more detail.

Well, once again, thanks to all of you. Thanks so much, Diana and Martha and all the city staff that we have on. And I think we will bid you all a happy Monday.

Thank you.

Thank you, everybody. Good night.