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HomeMy WebLinkAbout15 - Council Policy Manual Update for 2005CITY OF NEWPORT BEACH CITY COUNCIL STAFF REPORT Agenda Item No. is August 23, 2005 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: City Manager's Office Dave Kiff, Assistant City Manager 949/644 -3002 or dklff @city.newport- beach.ca.us SUBJECT: Council Policy Manual Update for 2005 and Public Meeting to Consider City's Statement of Investment Policy (Policy F -1) RECOMMENDATION: Approve the proposed revisions, additions or deletions to the Council Policy Manual: -- Revisions to B -1, B -2, B -6, B -7, B -8, B -10, B -13, B -14, F -1, F -2, F -3, F -15 and L -2; -- Addition of F -25; -- Deletion of B -5 DISCUSSION: Backqround: This agenda item contains two parts: • Part I — The annual review of the City Council's Policy Manual (with recommended changes, additions or deletions of 15 separate policies); and • Part II — The annual affirmation of the City's Statement of Investment Policy (Council Policy F -1) as required by California law. Part I -- Policy Manual Review. Council Policy D -3 directs the City Council to review the more than 100 policies in the Council Policy Manual annually. These policies exist to instruct the Council and City staff on how to process a variety of different issues -- from airport and annexations to voice mail and water service outside the City limits. This year, the 15 policies proposed for change, addition or deletion are summarized in Attachment A. Many of the proposed changes are minor and are NOT all summarized below. Noteworthy changes include the following: Council Policy Manual Update for 2005 August 23, 2005 Page 2 Statement of Investment Policy (F -1) Regardless of changes, this policy needs to be re- certified by the City Council every year, and we accomplish that as part of this process. The only changes this year involve revising the minimum credit rating for medium term corporate notes, and some non - substantive language changes intended to keep the policy consistent with terminology used in the industry. The changes were recommended by our Investment Advisors, from whom we solicit policy change recommendations each year. Reserves /Designation of Fund Balance (F -2) The recommended changes in this policy primarily involve the Stabilization and Contingency Reserves in the General Fund. The proposed revision will result in no change in the use of Stabilization Reserves for specific purposes. However, the generic 2% Stabilization Reserve is being combined with the Contingency Reserve. As a practical matter, the distinction between the purposes of these two Reserves has become less significant than was envisioned when they were established. In addition, a specific target minimum for the Capital Improvement Reserve is proposed to be established at $10 million. Grant Administration (New F -25) Grant applications are initiated by many individuals throughout every department within the City. Grant requirements vary by contract but invariably contain financial record keeping, reporting and audit requirements which often require interdepartmental coordination. A grant administration policy was necessary to provide grant applicants the basic financial and administrative responsibilities when accepting grants. This new policy establishes guidelines for the application, acceptance, administration, and financial reporting of grants and restricted donations. Part II -- Affirmation of City's Investment Policy. Following the County of Orange's bankruptcy in late 1994, the State Legislature adopted SIB 564 (Johnston) which requires each local agency to consider its Statement of Investment Policy (the City Council's Policy F -1) annually at a public meeting. The law reads as follows: Government Code § 53646 — (a) The treasurer or chief fiscal officer shall annually render to the legislative body of the local agency and any oversight committee a statement of investment policy, which the legislative body of the local agency shall consider at a public meeting. Any changes in the policy shall also be considered by the legislative body of the local agency at a public meeting. Council Policy Manual Update for 2005 August 23, 2005 Page 3 The Council's review of this policy at a public meeting (the August 23, 2005, City Council Meeting) completes this obligation. Prepared by: �akq Dav , Assistant City Manager Attachments: A — Summary of Proposed Council Policy Changes B — Council Policies — Strikeout and Underline Versions (except F -25, which is new) 3 I m m m m N Cl) I I I I I I� '� I I I I E Ig HO .r m° i Im 5 dr ` m O IU O I 10 ! tti L' N m d dl I I I I III I i� 10 l a� Inbc? 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LLJ > mw < z M� o 0 c CL w 0 E3 Im M A > M M LU 0 EL M 0 a a .5 8 L8 a 116 0 E > I b B 5 a t5 C m >:'C W a 0 u a 1 5 IT Z N L V) EL Ly > < EL LLI L) V) n 0 2 LU 0 0 p I I I I I I 4s 6 E E cl 0 Z ?"I o E � I", I SIM25 ;" - " Z la ;z I w- 6 E E cl 0 Z ?"I o E � I", I PARK FEE POLICY PURPOSE The City of Newport Beach maintains an extensive park and open space system. The acquisition and development of our park and open space properties is funded, in part, through the payment of park fees paid by persons or entities who subdivide properties. The Subdivision Map Act requires park fees to be used only for the purpose of developing new or rehabilitating existing neighborhood or community park or recreational facilities to serve the subdivision that paid the fees. The City is required to develop a schedule specifying how, when and where the park fees will be used. The purpose of this Policy is to establish the criteria to be used in deciding which facilities serve subdivision residents and schedule whereby park fees are properly and timely committed to appropriate projects. POLICY A. Service Criteria. The Recreation and Open Space Element of the General Plan states that community parks and view parks serve the entire City. Community parks are those with improvements such as community buildings, parking, swimming, facilities for picnicking, active sports and other facilities that serve a larger population. Neighborhood parks which include unique recreational facilities, such as basketball courts, tennis courts, turf areas, active sports fields, community buildings, unique play areas or view parks are also considered City -wide resources used by all citizens. Accordingly, park fees generated by any subdivision within the City may be used to develop new or rehabilitate existing community parks, view parks, and those neighborhood parks listed on Exhibit A. The Recreation and Open Space Element divides the City into 11 services areas consisting of relatively discrete residential communities. These service areas were created for the purpose of determining whether particular geographical areas were deficient in terms of park and recreational facilities and to identify acquisitions or improvements which would provide residents with greater recreational opportunities. Accordingly, park fees generated by a subdivision within any services are may be used to create new, or rehabilitate, existing park or recreational facilities within that services area and as provided in the Recreation and Open Space Element. 1 9 to B. Implementation Schedule. Park fees shall be placed in the General Fund immediately upon receipt with a special designation as Park Fees. These funds, after special designation, shall be used solely for the acquisition or establishment of new, or the rehabilitation of existing, park, open space and recreational facilities. The park fees shall also be placed on a schedule that lists the location of the subdivision, the fees paid, the date on which the fees were paid or the date on which building permits had been issued for 1/2 of the lots created by the subdivision (whichever occurs later), the service area within which the subdivision is located, the neighborhood park, recreation and open space facilities eligible for park fees generated by that subdivision, the date on which the park fees must be committed to specific project of improvements. The park fees shall be used only for the park and recreation facilities identified in the Recreation and Open Space Element and shall be utilized in accordance with the policies and standards specified in the General Plan. Designations for expenditures will be made as part of the annual budget adoption. [Attachment - Exhibit A] Adopted - June 27,1994 Amended - April 23, 2002 Amended & Reassigned - April S, 2003 Amended - April 13, 2004 Formerly 1 -1 2 /0 EXHIBIT A PARK DEDICATION POLICY PARKS GUIDE M The following view parks serve as citywide resources by reason of their unusual beauty and the view provided: Back Bav View Park Bayview Park Begonia Park Channel Place Park Cliff Drive Park Corona del Mar State Beach Park Ensign View Park Galaxy View Park Inspiration Point Irvine Terrace Park Castaways Park Jasmine View Park Kings Road Park Lido Park Lookout Point Newport Island Park Peninsula Park Rhine Wharf Park West Jetty View Park Westcliff Park The following Community and Neighborhood Parks serve as citywide resources by reason of the unique recreational opportunities they offer: Arroyo Park - Lighted multi- purpose field, basketball court, picnic areas and playground. Bonita Canyon Sports Park - Four youth baseball fields, one multi - purpose field, one soccer field, tennis courts, basketball court, 2 plavgounds and connecting trail to Arroyo Park. Bonita Creek Park - Community center, lighted softball and multi- purpose field, and basketball court. Buffalo Hills Park - Basketball court, baseball/ softball diamond, volleyball court, multi- purpose fields. Carroll Beek Community Center and Balboa Island Park - Basketball court tot playground and community center. 3 Community Youth Center /Grant Howald Park - Basketball court, tennis courts, community center, softball and multi- purpose field. Eastbluff Park - Baseball diamond, multi - purpose field, and view of the Back Bay. Harbor View Nature Park - Natural vegetation area. Las Arenas Park - Lighted tennis courts, aFA- basketball court and community center. Lincoln Athletic Center - Gymnasium, lighted baseball/ softball diamond and multi - purpose fields. Mariners Park - Multi- purpose room, baseball/ softball facilities, racquetball courts, lighted tennis courts, multi - purpose fields, and an ADA equipped play area. The 9asis -OASIS Senior Center - Multi- purpose senior facility with classrooms and large multi- purpose room. Peninsula Park - Beach sited multi- purpose field, playground (ADA compliant, picnic and barbecue facilities, baseball/ softball diamond and gazebo. San Joaquin Hills Park - Tennis courts`pentanque courts and lawn bowling facility. San Miguel Park - Ball diamond, athletic field, four racquetball courts, basketball court and an ADA equipped play area. Theater Arts Center - Ninety seat community theater. West Newport Park - Tennis courts, racquetball courts, basketball court and 3 playgrounds. 3811, Street Park - Basketball courts and playground (ADA compliant). N '1a INSTRUCTIONAL RECREATION ACTIVITIES The instructional recreational programs for children and adults provided by the Recreation & Senior Services Department will be conducted on the basis of being at least self - supporting. An amount equal to at least 25% of the costs incurred will be set aside for administrative overhead. Registration fees will be based on an amount sufficient to acquire independent contractors, class materials and the administrative overhead and a facility use fee. Occasionally, it may be necessary to conduct a specific class in which revenues are not sufficient to be self- supporting. However, each total recreation program, such as tennis, sailing, surfing, etc., will be at least self- supporting. The Recreation & Senior Services Director or designee is authorized to enter into agreements for securing independent contractors for apgroved instructional recreation activities. A sum of money equivalent to 20% of the gross annual revenues derived from the instructional classes in surfing shall be set aside and used for the purpose of purchasing new or replacement surfboards or development of aquatic and surf related activities. A total of 20% of the registration fees from tennis instructional classes shall be set aside annually for refurbishment or development of courts or development of new recreational programs or facilities. The Reereatien & Saenier gerviees— Director or designee is autherized to enter i ro activities. A total of 20% of the registration fees from the sailing instructional classes and 100% of the proceeds from the agreement for the use of the 29th Street public dock shall be set aside annually for refurbishment and replacement of the recreation sail boat fleet and development of waterfront activities program. Adopted - October 1963 Amended - August 30,1966 Amended - November 25,1968 Amended - March 1970 Amended - April 12,1971 Amended - August 9,1971 Amended - February 14,1972 Amended - March 13,1972 Amended - November 11, 1974 Amended - March 24,1975 Formerly I -6 Formerly I -2 Amended - December 8,1975 Amended - November 27,1978 Amended - November 28,1988 Reassigned -January 24,1994 Amended - February 27,1995 Amended - December 14,1998 Amended - May 8, 2001 Amended - April 8, 2003 Amended - April 13, 2004 l .J Ellm inteda}'s era e€ limited .eseu ees, support gretrps have Permed to render essentia a„sistanee, both it 4pe and money, te vertkwhQie publtcspregfanas and faei r; toe contest of a p alesephy Nvl4eh encett.ages- people -te help them6elves --in theif lire effertteprovide seder p.egratns and se=viees at the OASIS Senier The Department , eleomes velianteer supported intends by this peliey to den i€y 'he relationship, Y-eles and een4el beliveen the City of Nev,..., u,.,. and Ffie .a OASIS. A. The City, through the ..en & Senier Services Pepartment, is respen . . Per determining priorities ef use and oye a1.' -sehe' ulimg eF the OASIS Seder Center. 13. Senior citizen aeries shall havep.i�erity of is aeev danee ::'o 'mo=t l D..1..., R 12 Public Use of City Facilities. C. The the OASIS Senior Centef f fOrts s-at iii the Reereation & Senier Services Pepaf4nent the Friends rata e e Of OASIS; and Department progEams and in consideration of the significant of as volunteer by the Friends ASIS Iaeil4 ' ^ ^�^ eentribxden of � .'^ o, • -- -- - ----- - . -- .. M mr-URIM-92, IMF 2 1 5 �• �. �M 2 1 5 NEWPORT THEATRE ARTS CENTER BACKGROUND lame, RIVA The Newport Theatre Arts Center (Theatre) has been the site of community theatre productions since 1979. The Friends of the Newport Theatre Arts Center (Friends), a non - profit public benefit corporation, have, since 1980, managed the Theatre and offered first class theatrical productions and shows using dedicated volunteers from the community. The Friends have presented at least four productions a year, have funded their program through ticket sales and donations from the private sector, and have used excess funds to purchase theatrical equipment. The plays and shows presented by the Friends are affordable to all economic segments of this community and offer residents a unique opportunity to attend or participate in theatrical productions. The Friends represent the epitome of "community theatre' - a volunteer effort using principally non -equity performers that is self funded and offers performers of all skill levels an opportunity to develop their talents. MANAGEMENT /PRIMARY USE The City Council has, pursuant to a written management agreement, appointed the Friends as the primary user and manager of the Theatre in recognition of their dedication, skill and effort over the years. The City Council is aware that the consistent presentation of first class community theatre requires extensive pre - production use of the venue for rehearsal, set construction and related activities. The City Council has determined that the community theatre program offered by the Friends requires exclusive use of the Theatre for continuous and extended periods of time throughout the year and from year to year. As manager, the Friends are required to make the Theatre available, and to supervise its use, by other groups or organizations selected by the City (Third Party/Third Parties) for stage plays or artistic events during no less than two#hree (2 -3) two -week periods each year (Reserved Periods). The Friends are also required to allow and supervise use by residents and local business owners for short meetings or events of limited duration. The City Council expects the Friends, in supervising the use of the Theatre by any Third Party, to serve as a resource, if called upon, to facilitate the efforts of community groups authorized by City to present stage plays at the Theatre. 1 f+ RAM RESERVED PERIODS The City, through the Recreation & Senior Services Director, is responsible for selecting the Third Party/Third Parties that will be permitted to use the Theatre to present stage plays or other artistic productions during the Reserved Periods. Third Party use of the Theatre shall be granted pursuant to a special event permit and license agreement (permit). In selecting among applicants, preference shall be given to public benefit non- profit corporations in good standing that have received a tax exempt determination pursuant to Section 501(c)(3) of the Internal Revenue Code. Since the theatre is one of very few venues in the area that is capable of accommodating live stage performances, preference shall be given to an applicant seeking permission to use the Theatre for live theatrical performances presented during at least one entire Reserved Period. The City shall use the following criteria in selecting among qualified applicants that have submitted timely applications requesting use of the Theatre at the same time during all or a portion of any Reserved Period: A. Previous experience in presenting live stage productions of a magnitude similar to that proposed in the application; B. Firm commitments from technical, artistic and support staff capable of producing a live stage play; C. The extent to which Newport Beach residents are involved in the production; D. The extent to which the production involves or generates educational opportunities for youth; E. Whether the applicant has secured the rights to produce the play and the extent to which the applicant can demonstrate the ability to pay required fees and charges. F. The potential for recurring use by the applicant. In the event that no application is submitted and approved by the City authorizing presentation of a live theatrical performance during any Reserved Period, preference shall be given to the applicant who first submits a timely application to present a cultural or artistic event that is consistent with the historical usage of the Theatre. The Recreation & Senior Services Director is authorized to meet and confer with applicants who have submitted conflicting requests in an effort to determine if the 2 it M-1 applicants are willing to modify the requests to avoid the conflict. The Recreation & Senior Services Director is also authorized to partially grant or modify any application to eliminate conflict or to preserve use of the Theatre for the City or for other purposes. While the Recreation & Senior Services Director will generally determine Third Party use of the Theatre pursuant to the application process. However, the City Council may, upon a determination that a requesting group substantially complies with the selection criteria in A - F and at a noticed public meeting, authorize Third Party use of the Theatre for multiple or consecutive Reserved Periods subject only to execution of the required permit. PROCEDURES A. Subject to the provisions of Subsection B, any individual, group or organization requesting permission to use the Theatre during all or a portion of any Reserved Period, or for any event that requires a special event permit pursuant to Chapter 5.10 -11.03 of the Newport Beach Municipal Code (applicant) shall file an application for a permit. The application shall be filed with the Recreation & Senior Services Department no less than 45 days prior to the first date of the Reserved Period during which applicant proposes to use the Theatre and shall be accompanied by the fee established by resolution of the City Council. The application shall be submitted on forms provided by the Recreation & Senior Services Department, all requested information shall be provided and an individual authorized to bind the applicant shall sign the application. The applicant shall clearly specify the requested dates and times for use of the Theatre and describe, in detail, the production to be presented as well as the technical, artistic and support personnel to be involved in the production. B. In the event that the City Council has authorized use of the Theatre by a Third Party pursuant to the provisions of the "Reserved Periods' section, the Third Party shall submit the information required by Subsection A within fifteen days after the action by the City Council but is not otherwise required to comply with the procedures specified Subsection A. CONDITIONS All use of the Theatre shall be subject to strict compliance with this Policy, the application submitted, the "House Rules" (Exhibit A) and the terms and conditions of the Special Event Permit and License Agreement (Permit). The House rules and the Q. l� MM Permit shall be provided to the applicant when the application is filed. In addition, each Permittee shall strictly comply with the following conditions: A. The Theatre shall not be used, or open for use, by any person before 8:00 a.m. or after 11:30 p.m. on any day. B. The Permittee shall take all reasonable steps to ensure that all users respect nearby residents by minimizing noise, parking and other impacts. C. The Permittee shall use the property, the Theater and the Theatre Equipment with due care and in a manner that avoids any damage, any injury to any person, and minimizes wear and tear. D. The Permittee shall comply with all applicable laws and shall take all reasonable steps to ensure that guests and invitees also comply with all applicable laws. E. The Permittee shall fully and immediately comply with all requests of the Recreation & Senior Services Director and the Chief of Police or their employees. FEES Use of the Theatre by any Third Party shall be subject to the payment of fees to the City for the use of the Theatre (Property Fee) and to the Friends, to the extent applicable, for use of the stage and sound equipment (Equipment Fees) and skilled personnel qualified to operate the Equipment (Operator Fees). The Property Fee, Equipment Fees and Operator Fees are as specified in the Fee Schedule (Exhibit B). The Recreation & Senior Services Director may waive all or a portion of the Property Fee upon request and a showing of good cause. The Recreation & Senior Services Director shall collect, and remit to the Friends, any Equipment Fees and /or Operator Fees. [Exhibit A - House Rules] [Exhibit B - Fee Schedule] H i7 Adopted - July 27,1981 Amended - October 22,1984 Amended - November 28,1988 Amended - October 22,1990 Amended - January 24,1994 Amended - May 22, 2001 Amended & Reassigned - April 8, 2003 Formerly I -18 Formerly I -6 RE Magi 5. Gi L.M. HOUSE RULES The following rules apply to all use of the Newport Theatre Arts Center (Theatre) by any Third Party using the Theatre. A. THEATRE USE The right to use the Theatre includes only the main theater consisting of the 90 seat auditorium and stage, "green room', entry lobby and public restrooms, box office area, two downstairs dressing rooms and bathroom, all access ways, parking area and exterior grounds. In no event shall Permittee use any office equipment or telephones owned by the Friends of the Newport Theatre Arts Center (Manager), the kitchen /office maintained by the (Manager), backstage workroom, or costume, prop and set storage rooms. Use of these areas is non- exclusive and Manager's agents may also occupy the designated areas provided they do not interfere with Permittee's use of the Theatre or the production. Only technical personnel approved by the Manager are allowed to enter the tech booth. B. MANAGERS PROPERTY /EQUIPMENT Permittee shall not use Manager's tools, costumes, props, or sets. Permittee may use the telephone provided by the City. C. SUPERVISION Access to, and use of, the Theatre shall be pursuant to the supervision of a Stage Manager or House Manager designated by the Manager. D. MARQUEE Permittee is to provide the layout for inclusion of text in the marquee and Manager approved personnel will install the lettering or supervise the installation by Permittee. Only layouts that utilize existing Theatre lettering will be allowed. The marquee will be available to Permittee only during the Use Period. Exhibit A 1 :RIN . E. CLEANING The carpeted areas and seats in the Theatre must be completely covered by Permittee during any set construction, painting or other work on the stage or in the auditorium area to protect those facilities against dust and damage. At the conclusion of the Use Period, Permittee shall return all facilities and equipment to the condition immediately prior to use by Permittee. F. SOUND MONITORS The sound monitors are permanently located and Permittee shall not move or relocate the monitors. G. FOOD BEVERAGES Food or drink is permitted only in the lobby. No food or drink may be taken into the auditorium. Permittee shall consult with Manager, and receive Manager's approval, prior to any sale or distribution of food or beverages on or from the Theatre. H. BOX OFFICE PERSONNEL Permittee shall provide box office personnel as well as tickets and /or reservation services. Permittee shall also provide any security or admission personnel. Manager may be able to supply box office personnel if Permittee makes a timely request and pays required fees. I. DECORATIONS Permittee shall not use confetti, glitter, spray paint, liquid paint, burning objects or helium balloons on the property. Permittee shall obtain Manager's approval of a decorating plan prior to installing any decorations. J. DRESSING ROOMS The dressing rooms are reserved for the use of the actors and stage personnel. In no event shall the dressing rooms be used for entertainment of guests or the storage of equipment. Smoking and alcohol are prohibited in dressing rooms. Exhibit A 2 ,- n :. K. RIGHTS AND ROYALTIES Permittee shall provide evidence that they have applied for the rights to stage, at the Theatre, the production described in the application for permit and that all required royalties and rentals have been paid. In no event shall Permittee be allowed access to the Theatre without providing proof of rights and royalties. Permittee shall not film or reproduce any production unless and until Permittee provides evidence that publisher or owner of the performance rights has given express permission to do so. Adopted -May 22, 2001 Reassigned - April 8, 2003 Formerly I -6 Exhibit A 9 W. FEE SCHEDULE Effeetive May 1, 2003 through july 31, 2004. FEES CHARGED ARE IN ACCORDANCE WITH THE MASTER FEE SCHEDULE WHICH IS ANNUALLY ADJUSTED BY RESOLUTION OF THE CITY COUNCIL. A. Lighting Designer to hang, focus and program lights _ -or - Lighting Technician who will program existing hanging lights only and operate lights for shows - $r.00 per hour with 3 hour. minimum. B. Sound Designer to place sound equipment in locations, adjust microphones and program equipment, etc. $250 400: C. Additional technicians to operate lights and /or sound equipment during performance -- each $20. 00 per hour wwith �3 hour minimum. D. Stage Manager who will monitor backstage activities and assist with matters involving use of stage and curtain only _$20:00 -per hour with 3 hour minimum. E. House Manager who will monitor front of house, direct ushers and assist with matters involving front of house only _$18:00 -per hour with 3 hour minimum. F. Ushers -_ $1 45-per usher per show, from 30 minutes before performance t-1r-a through intermission. G. Lamp and lighting equipment use, including dimmer packs, computers, light board, hanging fixtures, lamps and gels -_ $30 -per hour or part of hour, including programming time, as well as running time for show. Rate to be $36- different per hour if both lighting and sound equipment are used. H. Permittee reimburse the City epAlanager-for all charges or costs associated with services requested by Permittee. No charge for use of small piano other than tuning charge if user wants piano tuned. Small piano moving and replacement to original location to be done by Permittee. Property Fee is chad$30040 -per day of use. Adopted - May 22, 2001 Amended & Reassigned - April 8, 2003 Formerly I -6 Exhibit B i SPECIAL EVENT PERMIT REQUEST PROCESSING PURPOSE r.M►i To set forth City policy concerning administration and control of special events. Special events include activities as defined in Chapter 11.03 of Title 11 of the Newport Beach Municipal Code. Requests that include activities for which the Municipal Code requires that a permit be obtained may be included in the special event permit process. POLICY It is the policy of the City Council to ensure that the numerous special event activities permitted by the City do not negatively affect the community, that requests for permits are efficiently processed by staff, that City liability is eliminated, that all appropriate insurance requirements are met, and that costs for municipal services provided are kept at a reasonable level and recovered from the event sponsors. Affected City departments shall be notified of special event permit requests in accordance with the schedule attached and provide recommendations on how to conduct the event safely, lawfully and with a minimum negative impact on the community. It is the responsibility of the Recreation & Senior Services Director to coordinate the administration of special events and to be the central contact point for residents or other event sponsors, as well as the various City Departments having influence or control over aspects of any given event. Requests for special event permit applications will be received by a special event coordinator in Recreation & Senior Services and routinely routed to appropriate departments for investigation. Each department will investigate the proposed event and make a recommendation for approval or denial of the event. If recommended for approval, recommended conditions for approval will also be presented. Events that include the following activities or aspects shall be additionally reviewed by the departments indicated: Activity Reviewing Department Fireworks Fire Department Police Department City Manager 1 rr Tents & Canopies Requests on the Harbor Requests on the Balboa Pier Requests on McFadden Plaza Requests on the Newport Pier Requests on Public Beaches Requests in a Public Park Requests to Deviate from Use Permit Requests at a Commercial Location Signs & Banners on Private Property Signs & Banners on Public Property Amplified Sound at a Commercial Location Amplified Sound at a Residential Location Temporary Street or Sidewalk Closures Sidewalk Sales Fire Department Building Department Harbor Resources Division Sheriff's Harbor Department Public Works Public Works Public Works Harbor Resources Division General Services Fire Department Recreation & Senior Services Department General Services Planning Department Planning Department Planning Department Public Works Planning Department Police Department Revenue Division Public Works General Services Public Works Planning 2 (A'G Use of Public Property Public Food Service Use of Back Bay Drive Risk Manager Health Department Department of Fish & Game General Services Public Works X37 If each department reviewing a special event permit application recommends approval of issuance of the permit, a permit will be issued to the applicant listing the conditions provided by each department. The City Council may authorize approval of any request for special event permit when: A. Required by Municipal Code. B. When a Level 3 Special Event Permit has been denied and the applicant chooses to appeal the denial. Adopted - January 24,1994 Amended - February 24,1997 Amended - May S, 2001 Amended & Reassigned - April S, 2003 Amended - April 13, 2004 Formerly I -7 3 'r 3' :: BIKE, FOOT RACE AND SURF CONTEST EVENT POLICY The purpose of this policy regarding the use of City streets and beaches for conducting bicycle races, running events, surf contests and other athletic contests is to minimize the inconvenience to City residents, and to eliminate any potential City liability for injuries resulting from the event. All bicycle races, running events, surf contests or events and similar athletic contests events shall be required to secure a Special Event Permit, comply with all of the conditions to the permit, and comply with the provisions of this Policy. Races, running events and other athletic contests events using City streets shall not be conducted during the summer (June 15 through September 15). No more than twelve (12) such events shall be permitted during any calendar year and not more than four (4) in one geographical area in one year. Surf contests using City beaches shall not be conducted during Memorial Day weekend or summer (June 15 - September 15). No more than eight (8) large and/or commercial events shall be permitted during any calendar year and events shall be scheduled at least three (3) weeks apart. All Surf competitions, no matter what the size, are required to register with the Recreation & Senior Services Department a minimum of one month prior to the scheduled event in order to receive approval for use of the requested location. There is no fee for registration of a surf competition, only for the Special Event Permit, if needed. All responsible parties must be able to provide upon request proof of a valid registration approval during the hours of the surf competition. Surf contest permits will be granted for specific dates only. No more than one surf contest will be scheduled per day. Surf contest permits do not allow for the exclusive use of the ocean or contest area and are always subject to blackball rules and reQUlations. There can only be a maximum of six (6) large and /or commercial contests at any one location per calendar year. The Fire Department determines acceptable locations for surf contests. The person or entity primarily responsible for administering the event must prove their ability to pay for all required City safety and maintenance services prior to issuance of any permit. Proof of ability to pay for these services shall be in the form of a cash deposit, bond, or similar instrument. The permittee shall, prior to the event, provide the City with evidence of insurance, with the City named as an additionally insured, with minimum coverage of one (1) million dollars per occurrence unless the City Attorney and City Manager determine that due to the circumstances surrounding the event, more insurance coverage is necessary. 1 .. No permit shall be issued for any race, running event, surf contest or athletic contest event which is sponsored or financially supported by a tobacco or alcohol company and no alcohol or tobacco shall be permitted to be dispensed or available in the event there are participants under the age of 21. Nor will any sig_nage promoting alcohol or tobacco company be allowed to be displayed at the contest /event Adopted - February 14,1953 Amended - November 14,1953 Amended - September 22,1956 Amended - January 24,1994 Amended - July 25, 2000 Amended & Reassigned - April S, 2003 Amended - April 13, 2004 Formerly I -21 Formerly I -S 2 {a Pq Adopted - February 14,1953 Amended - November 14,1953 Amended - September 22,1956 Amended - January 24,1994 Amended - July 25, 2000 Amended & Reassigned - April S, 2003 Amended - April 13, 2004 Formerly I -21 Formerly I -S 2 {a USE, PRIORITIES AND FEES FOR MARIAN BERGESON AQUATIC CENTER The Marian Bergeson Aquatic Center MBAC is a 50 meter pool complex located on the Corona del Mar High School campus. The Newport -Mesa Unified School District NMUSD as the legal owner of the property, has entered into an agreement with the City of Newport Beach CITY to allow public use of the facility after official school use. This agreement has resulted due to the significant contribution to the pool construction by the City. PURPOSE OF USE The foregoing facilities and equipment therein shall be used for activities which are recreational, social or civic in character, and offer services of interest or need to the community. PROCEDURE Any group desiring to use the Marian u,...,.eso Aquatic Genie MBAC shall make application on forms provided by the Recreation & Senior Services Department (Department) and shall provide such additional information as may be required by the Department to assure compliance with priorities. Applicants may be required to satisfy the Department that activities will be conducted in an orderly manner and that such person(s) or groups are financially able to respond to damages arising therefrom. Prior to the use of any facility, the application must have been approved by the Recreation & Senior Services Director or a designated representative. SCHEDULE The City of Newport Beaelrrand the Newport Mesa OF fiea SEhoe' TMstrk- NMUSD establishes the use of the aquatic center as follows: Pool Use Criteria (As Dictated by School District -City Agreement) School Year A. 6:00 A.M. - 3:00 P.M. District use only. B. 3:00 P.M. - 6:00 P.M. Joint use City/District w /District as first priority. .�J W-1 C. 6:00 P.M. - 9:00 P.M. City exclusive use. Holidays, Summer Vacation, Saturdays A. 6:00 A.M. - 9:00 A.M. 011101TIFEWLTAIELOXITOW1 Sundays Joint scheduling w/ City priority. City exclusive use. A. 6:00 A.M. - 9:00 P.M. Joint City/ District. (Use includes showers, restrooms and ancillary facilities.) A. All official n,,,...eation r- Senior Serv:ees Department /City of Newport Beaeh initiated and /or conducted activities. B. All official Reereatien & Senior ServiRT Department co- sponsored groups and /or activities. The aforementioned are community groups and activities which are nonprofit, self - governing, privately organized aFg-of a recreational nature whieh may be brought under the sponsorship of the Reerea lien & ge- c° Services Department by application. C. Official School District sponsored programs and activities. D. Official public agency sponsored programs and activities not included in the above categories. E. Recreational, social or civic activities and /or groups (resident) promoted and sponsored by local nonprofit organizations which are open to the public and have 50% or more of memberships consisting of Newport Beach residents. P. Recreational, social or civic activities and /or groups (nonresident) promoted and sponsored by nonprofit organizations which are open to the public, not qualifying under Priority No. E. G. Private resident and nonresident use. H. Commercial or profit making groups. 2 -� ') 1 SPECIFICATIONS FOR AQUATIC TIC r->vnrrnn MBAC USERS A. Determining factors of priority shall include, but not be limited to, the number of Newpert Beae4rCresidents on the playing teams, recognized seasonal sports, and past contributions to facilities by sponsoring groups. This policy shall not be exclusionary to any group. Staff has the right to revoke a permit for specific times if the facility is not being used. B. Recognized seasonal sports shall be determined where at all possible one year in advance. All non - seasonal sports shall be accommodated, but scheduled secondarily to seasonal sports. Special tournaments/ regional playoffs, even if off - season, shall be accommodated whenever possible. Applicable fees will be charged to the hosted group. Special events shall be applied for at least six months in advance and not more than 18-12 months in advance. C. Staff will coordinate and chair quarterly meetings to determine equitable use of available athletic facilities. Groups not satisfied with the results of this procedure can appeal the staff determinations to the Parks, Beaches and Recreation Commission. The Parks, Beaehes & Reereation Commission- designated e :.} ...,bers will attend tive of these meetings (early fall and early spring) for the purpose ef: reviewing the sueEess of the programs, and gathering D. The MBAC may be closed for periodic maintenance and renovation at a time determined by SEh^ et NMUSD staff to be least disruptive to all parties. E. Any group claiming nonprofit status must submit, at request of staff, a copy of the group's constitution, bylaws or rules and regulations. Membership and meetings or activities must be open to the public. Fees, donations or admissions charged by the group must be limited to essential expenses of the group. The group treasurer will be required to submit a financial report following each activity when any of the above is collected. Aetivities shall net invelve individual ual g r be in the nature of „ eenunereial enterprise. FEES AND DEPOSITS A. The fees charged for use of the _^_g uat__ CentCente MBAC shall be establish a are in accordance with the Master Fee Schedule which is annually and pefiediaally adjusted by a- resolution of the City Council 4 IM B. The intent of these fees shall be that the Marian Bergeson A EfaafiE MBAC be operated on a self- supporting basis. C. The NMUSD requires a custodial fee from groups to clean and maintain the facility both during and after a rental. Adopted - June 25, 1990 Amended - January 24,1994 Amended & Reassigned - April S, 2003 Formerly I -24 Formerly I -11 PUBLIC USE OF CITY FACILITIES PURPOSE B -13 City of Newport Beach (Citvl facilities, which include parks, playing fields, gymnasiums, community rooms and swimming pools, are available to the public for civic, social, educational, athletic and cultural activities. It is the intent of this Policy to provide use regulations and application and scheduling procedures to accommodate all groups that wish to use City facilities. PROCEDURE A. Applications to use the City facilities must be made on forms provided by the Recreation & Senior Services Department (Department). — Applicants must provide all information as may be required by the Department to assure compliance with the requirements and regulations of this Policy. B. Applicants will be required to pay a security deposit in an amount that will promote use of the Recreation & Senior Services facilities in an orderly manner without damage to the facilities. Security deposits will be refunded upon inspection of facilities and confirmation that no property damage has occurred. C. Applicants will be required to acknowledge that neither the City nor the n,,,.,.eati,.,, & c.,BiOr- See ViEes Department assumes any liability for injury or loss of personal property. Prior to the use of the facility, the application must have approval of the Recreation & Senior Services Director or designated representative. D. Approval or denial of an application will be provided within five working days of receipt of a completed application. E. Reservations for use of ReEreation & Senior c,.,.,.:,.,,,. Department facilities may be made up to six months in advance, but no later than five working days before the event. Any organization using City facilities on an ongoing basis shall notify the Reereati n & e,..-.;,,,. c,.,.,.; Department when there is a change of officers or of organizational policy. F. The City of Newport Beaehris not liable for any and all accidental injury to any and all persons or loss or damage to group or individual property. When it is deemed to be in the best interest of the general public, the City of Newport Bead; 1 B -13 will require the permittee to furnish a Certificate of Insurance naming the City of Newport Beach as an additional insured. The amount of the insurance shall not be less than $1,000,000 per occurrence of commercial general liability insurance. G. A contract shall not be transferred, assigned or sublet. All contracts will be issued for specific facilities and for specific hours, and the premises must be vacated as scheduled. H. The application must be completed and signed by an adult age 21 and over who will attend, supervise and be responsible for the entire event or activities. Proof of residency may be required at the time of application in order to receive the resident rate. REGULATIONS AND RESTRICTIONS All uses of Recreation u Senior c Departinent facilities will be subject to the following regulations and restrictions: A. Alcoholic beverages are prohibited and shall not be permitted in or on any municipal facilities operated by the Recreation v_ Senior Services Department, except beer and wine may be served for special occasions at the OASIS Senior Center multi- purpose room when done in compliance with State Alcohol Beverage Control regulations and approved in writing by the Recreation & Senior Services Director. Approval to serve beer and wine at the OASIS Senior Center shall not be deemed to approve service of alcohol in violation of Section 25604 of the Business and Professions Code. The Recreation & Senior Services Director will require the permittee to pay City costs to provide additional security. B. Smoking is prohibited in all City facilities including restrooms and with 20 feet of all entrances, windows and within 25 feet of all plavgounds. C. For all indoor facility rentals involving young people, 18 years and under, there shall be at least one adult for every 20 minors, or increments thereof, in attendance, who shall remain in the facility for the duration of the activity. D. No group's activities shall interfere with the administration of the Recreation Senior Department. 2 B -13 E. Non - profit 501 (c) (3) groups may use the facility for fundraising activities and charge entrance fees and collect donations provided that a detailed plan of the event, including the expenses, marketing plan and procedure for collecting fees, is submitted with the rental application. The group treasurer will be required to submit a financial report following any such activity. F. Facilities and equipment are to be left in the same condition as they were prior to the rental. The permittee is responsible to pay for any damage to property or loss of property. A fee equal to total replacement cost will be charged. It shall be the responsibility of the permittee to see that unauthorized portions of the facility are not used. Continued or repeated use of City facilities will be contingent upon care of the facility, property and equipment, and observance of all approved rules and regulations. G. No gambling of any kind shall be conducted on, or in, City facilities, and the permittee shall insure that no disorderly or illegal conduct shall be allowed in any facility. H. The use of public address equipment will be limited to that provided by the facility, unless written approval has been secured by the R..,...eatior r- Se- Se -ices Department through a Special Event Permit. I. Private groups wishing to collect fees, donations or admission charges will be considered commercial users. J. The capacity of City facilities shall not be exceeded. K. Storage space will not be granted to any ongoing activity or uses. L. Facilities are not available for reservations on the following holidays: Christmas Eve, Christmas Day, Easter, President's Day, Independence Day, Labor Day, Martin Luther King Day, Memorial Day, New Year's Eve, New Year's Day, Thanksgiving and Veteran's Day. M. All persons using the facilities shall observe and obey regulations of this policy, the rules of the ReEreation & Senio, ges=ieeTDepartment and all applicable City, State and Federal laws, rules and regulations. FEE CLASSIFICATIONS - PRIORITIES OF USE 3 B -13 Permission for use of City facilities shall be granted on a first come first served basis, subject to the following priorities: A. All official p,,,...eatio & Senior Services Department initiated and /or conducted activities, including those of the Friends of OASIS at the OASIS Senior Center. B. All official City of Newport Beach activities. C. All official City co- sponsored groups and /or activities such as community groups and activities which are non - profit, self governing, privately organized and of an educational nature which may be brought under the sponsorship of the Recreation & Senior Services Department. D. Official public agency sponsored programs and activities not included in A, B, and C above. E. Youth Sports Commission Member Organizations. F. Resident non - profit youth serving organizations with 50% or more of membership consisting of Newport Beach residents. G. Recreational, social or civic activities of groups which are resident promoted and sponsored by local non - profit* organizations which are open to the public and have 50% or more of memberships consisting of Newport Beach residents. H. Recreational or social activities of private Newport Beach residents which are not open to the public. I. Recreational, social or civic activities and /or groups which are non - resident promoted and sponsored by non - profit organizations which are open to the public, but not qualifying under D above. J. Schools, colleges, hospitals and other similar civic groups not qualifying under the definition of non - profit. K. Others. * Non - profit status is defined as an organization that is so defined by the Infernal Revenue Semice, § 501(c) (3) and has a State of California Tax Identification Number. FEES, DEPOSITS AND CANCELLATION PROCEDURES n B -13 Fees may be charged for the use of City facilities and shall be established and periodically adjusted by the Parks, Beaches & Recreation Commission and approved by the City Council. Fees are imposed to cover overhead, processing, deposits, maintenance and replacement costs for application and scheduling and maintenance of the facilities. A. A security deposit will be required for all room rentals. All or a portion of the deposit may be retained by the Recreation & Senior S,....,;ces Department after inspection of the facility by the Recreation & Senior Services Director or a designated representative and a determination that the facility has not been left clean and /or in good repair. B. A separate additional cleaning fee will be charged for rental of the OASIS Senior Center multi- purpose room. C. No fee or deposit shall be charged for use of City facilities by the City of Newport Beach, "he Prip_4;ds s OASIS when utilizing the OASIS S... ie f Confer, dur-ing normal business operational hours, or events co- sponsored by the City of Newport Beach or its departments, with the exception of set -up charges and fees for lighting usage. D. Cancellations for any facility other than the OASIS Senior Center multi- purpose room may occur seventy -two hours prior to the scheduled use of facilities without forfeiting fees collected by the City, with exception of a City service refund processing fee. Cancellations with less than seventy -two hours notice will be charged a cancellation fee established by resolution of the City Council. In the event of cancellation by the City, notice will be given as far in advance of the scheduled use as possible. E. Cancellation of rentals by users for the OASIS Senior Center multi- purpose room that occur less than thirty days prior to the scheduled use of the facility will be charged 25% of the rental fee. Cancellations with less than seventy -two hours notice will be charged the entire rental fee. Adopted - May 26,1998 Amended - May 8, 2001 Amended - April 23, 2002 Amended & Reassigned - April 8, 2003 9 J,U M Amended - July 22, 2003 Formerly I -25 07 :- TEMPORARY SIGNS WITH SPONSORSHIP RECOGNITION IN CITY PARKS AND BEACHES Temporary signs which recognize sponsorship of City sponsored or co- sponsored sports programs may be posted in a City park or beach when the signage complies with the criteria set forth in this policy. The Recreation & Senior Services Director will require that sponsorship signs meet the following guidelines and that any other approvals which may be required are obtained: A. The signage must relate to a program sponsored or co- sponsored by the City of Newport Beach. B. The signage must: 1. Not exceed twenty-four (24) square feet in size; 2. Be posted in a location not visible from public streets and pre- approved by the Recreation & Senior Services Department; 3. Be posted only during the designated priority season for that sports group; 4. Be aesthetically appealing, with consideration for the surrounding area. C. No signage related to fe -- alcohol or tobacco is permitted. D. The applicant is responsible for placement and removal of signage and for storage, damage, theft, or loss of any sign posted. Adopted - September 14,1998 Amended & Reassigned - April 8, 2003 Amended - April 13, 2004 Formerly I -26 1 `1 h STATEMENT OF INVESTMENT POLICY PURPOSE F -1 To set forth the City's policy concerning the investment of temporarily idle funds. It is the policy of the City to invest funds not required for immediate expenditures. Investments will be in compliance with governing provisions of law and the policy contained herein. Primary investment goals are security of principal, adequate liquidity maintenance, and yield, in that order. Investments shall be placed only in securities as outlined below. The balance between various investment instruments may change in order to provide the City with the best combination of yield, liquidity, and a consideration for other factors, such as placement of an appropriate percentage of available investment funds locally. It shall be the main responsibility of the City Council, in adopting this policy and reviewing the investment holdings on a monthly basis, to preserve the investment principal. INVESTMENT AUTHORITY Under the direction of the City Manager, the investment authority has been delegated to the Director of Administrative Services, who is responsible for administration of the City's investment program, and who shall thereafter provide a monthly report regarding the status and changes in the City's investment portfolio to the City Council. This authority shall be renewed annually as part of the review and update of this Policy. In addition to the monthly investment report that is submitted to the City Council, the Administrative Services Director shall provide more detailed investment information to the City Council as requested. The City Council shall be briefed directly by the City's investment advisors on a quarterly basis whenever possible. Sections 53600 -53601 of the California Government Code provide basic investment limits and guidelines for government entities. In the event an apparent discrepancy is found between this policy and Sections 53600 - 53601, the more restrictive parameters will take precedence. FINANCIAL INSTITUTIONS The City shall not deposit funds with any financial institution not receiving a minimum overall satisfactory rating for meeting the credit needs of California Communities in its most recent evaluation ( §53635.2). 1 q1 F -1 LIQUIDITY Sufficient funding to accommodate at least two- week's projected cash outflow is to be maintained in immediately available investments, such as the State Local Agency Investment Fund, maturing certificates of deposit, or similar liquid instruments. An analysis of cash flow must be conducted at least weekly to serve as the basis for determining appropriate maturities for investments. At no time shall the liquid cash on hand be less than 5 percent of the City's total investment portfolio. For purposes of this policy, cash on hand includes all cash and investments accessible within 48 hours. ACCEPTABLE INVESTMENT INSTRUMENTS The following are types of investments made by the City and the guidelines for investing in each. In all cases, investments shall be made in the context of the "Prudent Ma- tInvestor Standard," ru4e; spelled out in the California Government Code, Section 53600.3 as follows: "When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency. Within the limitations of this section and considering individual investments as part of an overall i es ~ strategy, investment may be acquired as authorized by law." In this light, the City of Newport Beach does not purchase or sell securities on margin. Additionally, any institution, which holds either the collateral or the investment instruments themselves in safekeeping for the City, must maintain at least one billion dollars ($1,000,000,000) in assets. A. Certificates of Deposit Only fully collateralized certificates of deposit with FDIC insured institutions will be utilized in investment of City funds. Government securities having a market value of 110 percent of the total amount of investment are acceptable as 2 F -1 collateral. Noncollateralized CD investments may be made in amounts less than $100,000 so long as they are fully insured by the FDIC. Not more than 10 percent of the City's investment portfolio shall be invested in certificates of deposit with any one institution. CD's will not be placed for a period of longer than one year. Further, an institution must meet the following criteria to be considered by the City: 1. The institution must maintain at least $1 billion in assets ($100 million for fully insured CD's of $100,000 or less). 2. The institution must have been in business at least three years. 3. The institution must have a net worth to asset ratio of at least 6 percent. 4. The institution must place and maintain on file with the City an audited financial statement not more than one year old. 5. Interest shall be paid to the City on a monthly basis. B. Negotiable Certificates of Deposit As a matter of policy, the City invests in Negotiable Certificates of Deposit only with U.S. Banks whose underlying securities are rated A -1 or P -1 by one of the top two rating agencies and having assets in excess of $10 billion, so as to insure security and a large, well - established secondary market. Ease of subsequent marketability is further ascertained prior to initial investment by examining currently quoted bids by primary dealers and the acceptability of the issuer by these dealers. No one issuer shall exceed more than 10 percent of the portfolio, and maturity shall not exceed one year. The California Government Code Section 53601 limits investment in negotiable certificates of deposit to 30 percent of the portfolio. C. Bankers Acceptances The City may invest only in Bankers Acceptances issued by the 100 largest banks in the world, which are eligible for purchase by the Federal Reserve System, the short term paper of which is rated at the highest category by Moody's and Standard & Poor's. In the case of foreign banks, the Bankers Acceptances must 3 q3 F -1 be written by their U.S. branches. Maximum maturity shall be 180 days. No more than 30 percent of the City's overall investment portfolio shall be placed in Bankers Acceptances, with no more than 10 percent of the City's portfolio invested in the banker's acceptances of any one commercial bank. D. U.S. Treasury Issues The City may invest in treasury notes, bills and bonds. Maximum maturity of any U.S. Treasury issue shall be five years. E. Federal Agency or United States Government- Sponsored Enterprise Obligations Securities of this type that are acceptable for the City's investments are Federal National Mortgage Association, Federal Home Loan Bank notes, Federal National Mortgage Association notes, Federal Farm Credit Bank notes, Federal Home Loan Mortgage Corporation notes, or any other U. S. Government Agency security. F. Commercial Paper The City may only invest in commercial paper of "prime" quality with the highest ranking or of the highest letter and number rating as provided for by a nationally recognized statistical -rating organization (NRSRO). The entity that issues the commercial paper shall meet all of the following conditions in either paragraph (1) or paragraph (2). 1. The entity meets the following criteria: (A) Is organized and operating in the United States as a general corporation. (B) Has total assets in excess of five hundred million dollars ($500,000,000). (C) Has debt other than commercial paper, if any, that is rated "A" or higher by a nationally recognized statistical- rating organization. 2. The entity meets the following criteria: (A) Is organized within the United States as a special purpose corporation, trust, or limited liability company. (B) Has program wide credit enhancements including, but not limited to, over collateralization, letters of credit, or surety bond. (C) Has commercial paper that is rated "A -1" or higher, or the equivalent, by a nationally recognized statistical -rating organization. Ell L C� F -1 Commercial paper shall be used solely as a short -term investment not to exceed 270 days. No more than 25 percent of the City's portfolio may be invested in commercial paper. Investment in commercial paper of any one issuer shall not exceed 10 percent of the portfolio. G. Repurchase Agreements ( Repos) and Reverse Repurchase Agreements Repos and reverse repos shall be used solely as a short -term investment not to exceed 30 days. The institution from which the City purchases a Repo must deliver adequate collateral to the City's safekeeping account (either directly or through a third party safekeeping agent), consisting of U.S. Treasury or Agency securities at the rate of 102 percent of the face value of the repo. The amount of this collateral must be sufficient to compensate for fluctuating market conditions. Repos will only be purchased from Primary Dealers. The City must own assets for more than 30 days before they can be used as collateral for a reverse repurchase agreement. No more than 10 percent of the portfolio can be involved in reverse repos. H. Passbook Savings Accounts Savings accounts may be used as a repository for customer deposits, or for similar purposes. Consistent with the requirements for CD investments, funds deposited in savings accounts must either be FDIC insured or collateralized. I. Local Agency Investment Fund (LAIF) (State of California) State Regulation of LAIF is set forth in California Government Code Section 16429.1. The current limits on any one City investment in this fund is $40 million, and the number of transactions (deposits or withdrawals) is limited to 15 per month. The City's participation in LAIF shall conform to State Regulation. In general, it is the City's intention to use investment in LAIF as a temporary repository for short -term funds needed for liquidity purposes. The Administrative Services Director shall maintain on file appropriate information concerning LAIF's current investment policies, practices and performance; as well as its requirements for participation, including, but not limited to, limitations on deposits or withdrawals and the composition of the portfolio. 5 ql F -1 J. County Investment Funds Los Angeles County provides a service similar to LAIF for municipal and other government entities. This Fund is available to certain cities outside of Los Angeles County, including Newport Beach. Investment in this pool is intended to be used as a temporary repository for short -term funds used for liquidity purposes. At no time shall more than 5 percent of the City's total investment portfolio be placed in this Pool. The Administrative Services Director shall maintain on file appropriate information concerning the county pool's current investment policies, practices and performance; as well as its requirements for participation, including, but not limited to, limitations on deposits or withdrawals and the composition of the portfolio. The City shall not invest funds with the Orange County Pool. K. Medium Term Corporate Bonds/ Notes Investments of this type will only be in corporations rated AA-A or better by nationally recognized rating services. Maximum term to maturity for individual securities shall not exceed four years. No more than 30 percent of the City's investment funds shall be placed in securities of this type. L. Mortgage- backed Securities and Asset - backed Securities Investments in securities of this type are limited to mortgage- backed pass - through securities issued by a US government agency; or consumer receivable pass - through certificates or bonds. Securities eligible for investment under this subdivision shall be issued by an issuer having an "A" or higher rating for the issuer's debt as provided by Moody's Investor Services and S &P. The security itself shall be rated in a rating category of "AAA" or its equivalent or better by Moody's Investor Services and S &P. The maximum final stated maturity of any security of this type shall be five years. No more than 20% of the City's investment funds shall be placed in securities of this type. M. Municipal Bonds Municipal bonds rated AAA, or AA and insured, are acceptable investments for the City. Investments of this type are limited to obligations of the State of 3 F -1 California and local agencies within the State. Not more than 15 percent of the portfolio shall be in investments of this type. N. Money Market Funds The City may invest in Money Market Funds subject to the following constraints. Investment in these funds is primarily intended for short -term "sweep account" purposes, not for longer -term investments. 1. Shares of beneficial interest issued by diversified management companies that are money market funds registered with the Securities and Exchange Commission under the Investment Company Act of 1940 (15 U.S.C. Sec. 80a -1.) 2. The company shall have met either of the following criteria: a. Attained the highest ranking or the highest letter and numerical rating provided by not less than two nationally recognized statistical rating organizations. b, Retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than ten years' experience managing money market mutual funds with assets under management in excess of one billion dollars ($1,000,000,000). 3. The purchase price of shares of beneficial interest purchased shall not include any commission that the companies may charge. 4. No more than 20 percent of the City's investment portfolio shall beinvested in money market funds. 5. The City shall invest only in Money Market Funds that have a policy of maintaining a constant daily net asset value per share of $1.00. 7 q.r F -1 PROHIBITED INVESTMENTS Consistent with California Government Code 53601.6, inverse floaters, range notes, mortgage derived interest -only strips, or any security that could result in zero interest accrual if held to maturity are specifically prohibited, except to the extent that they are shares of diversified management companies registered under the Investment Company Act of 1940. The City shall not purchase any security rated Al and or A+ or below if that security has been placed on "credit watch" for a possible downgrade by either Moody's Investor Services or Standard and Poor's. Investments not specifically approved by this policy are prohibited. ASSET/ INVESTMENT MANAGEMENT AGREEMENTS The City may employ the services of asset/ investment management companies. Such companies must have a history of producing no losses and relatively high net returns. They must also be well established and exceptionally reputable. Members of the staffs of such companies who will have primary responsibility for managing the City's investments must have a working familiarity with the special requirements and constraints of investing municipal funds in general and this City's funds in particular. They must contractually agree to conform to all provisions of governing law and the collateralization and other requirements contained herein. At no time shall more than 30 percent of the City's total investment portfolio be placed in any one investment management account. In order to implement this requirement, the City's portfolio assets will be reallocated annually among its investment managers. SAFEKEEPING /THIRD PARTY CUSTODIANS .All cash and securities in the City's portfolio, including those that are being managed by private sector asset/ investment management companies, shall be held in safekeeping in the City's name by a third party bank trust department, acting as agent for the City under the terms of a custody agreement executed by the bank and the City. The City will contract separately with major banks or other well - established, reputable financial institutions, which provide custodial services to maintain custody of cash and securities in the City's portfolio. In the case of a major financial institution, the City may have an asset/ investment management relationship, and a custodial relationship, with the same entity. However, the services must be provided by separately managed 8 Ii C F -1 departments within that entity, and the City's assets must be held in the City's name completely separate and distinct from the assets of the institution and from all other portfolios managed by the institution. All securities will be received and delivered using standard delivery versus payment (DVP) procedures, the City's safekeeping agent will only release payment for a security after the security has been properly delivered. The only exception to the foregoing shall be depository accounts and securities purchases made with: (i) local government investment pools; and, (ii) money market mutual funds, since the purchased securities are not deliverable. BOND PROCEEDS The investment of bond proceeds will be made in accordance with applicable bond indentures. RATING AGENCY CHANGES In the event a security held by the City is the subject of a rate drop which brings it below accepted minimums specified herein, or the security is placed on negative credit watch, where downgrade could result in a rate drop below acceptable levels, the investment advisor who purchased the security will immediately notify the Administrative Services Director or Deputy Director of that fact. The course of action to be followed will then be decided on a case by case basis, considering such factors as the reason for the rate drop, prognosis for recovery or further drop, and market price of the security. The City Council will be advised of the situation and intended course of action by e -mail or fax. REPORTING REQUIREMENTS In addition to the Monthly Investment Report, the City Council and City Manager shall receive a detailed quarterly listing of all investments in the City portfolio. The report must show the type of investment, issuer, date of maturity, par and dollar amount of deposit/ investment, and rate of interest. Quarterly reports from outside investment managers must also include market valuation of assets under their management and the source of that valuation, and shall also include a statement of compliance with investment policy. Current ratings of non - government securities, either Moody's or Standard & Poor's, will be included. E ✓1 /V/ F -1 In his report to Council, the Director of Administrative Services shall include a statement denoting the ability of the City to meet its expenditures for the next six months, and shall also include a statement of compliance with investment policy for assets under his direct management. In addition, the City Council shall be notified whenever 5 percent or more of the total portfolio is invested, withdrawn, or moved from one Investment Advisor or Pool to another. Adopted - April 6,1959 Amended - November 9,1970 Amended - February 11, 1974 Amended - February 9,1981 Amended - October 27,1986 Rewritten - October 22, 1990 Amended - January 28,1991 Amended - January 24,1994 Amended - January 9,1995 Amended - April 22,1996 Corrected - January 27, 1997 Amended - February 24,1997 Amended - May 26,1998 Reaffirmed - March 22,1999 Reaffirmed - March 14, 2000 Amended & Reaffirmed - May 8, 2001 Amended & Reaffirmed - April 23, 2002 Amended & Reaffirmed - April 8, 2003 Amended & Reaffirmed - April 13, 2004 Amended & Reaffirmed - 10 50 RESERVES /DESIGNATIONS OF FUND BALANCE PURPOSE F -2 To establish City Council policy for the administration of financial reserves and fund balances. DISCUSSION A. Background. Prudent financial management dictates that some portion of the funds available to the City be reserved for future use. Future uses are categorized as either pre - planned projects or unforeseen financial emergencies. For clarification, the City also has a number of Special Revenue Funds. These Funds are somewhat similar to reserves in that they act as a repository for money that can only be used for specific purposes. Reserves are generally distinguished from Special Revenue Funds in that decisions regarding the purpose and /or the amounts to be set aside, as well as the circumstances for use, normally fall within the authority of the City Council. That authority normally rests largely with an external entity in the case of Special Revenue Funds. B. Structure and Funding of Reserves. This Policy establishes Reserve Accounts or designated Fund Balance levels for moneys being held in reserve. In addition, the sources and eventual use of Reserve Funds are set forth. It is the policy of the City Council that each Reserve identified herein is to be fully funded as part of the annual budget process. If operational or other considerations require the City Council to temporarily override this policy during any fiscal year, the City Manager will recommend to the City Council a plan to restore any Reserves falling below required minimum levels. Reserve levels will be restored as soon as practical, but in not more than 5 years. Each of the City's fiscal reserves is established and maintained for one of four purposes listed in general order of importance below. If the reserve requirements of this policy are unmet in any fiscal year, the City Manager will recommend funding prioritization to the City Council as part of the Budget. Use of Reserves. The City Council decides whether to appropriate funds from Reserve Accounts. Even though a project or other expenditure qualifies as a proper use of Reserves, the Council may decide that it is more beneficial to use 1 51 F -2 current year operating funds or bond proceeds instead, thereby retaining the Reserve funds for future use. Reserve Funds will not be spent for any function other than the specific purpose of the Reserve Account from which they are drawn without a separate City Council Resolution approving that specific action. Information regarding Annual Budget Adoption and Administration is contained in City Council Policy F -3. C. Categories of Reserves. 1. Accounting Reserves. Generally accepted governmental accounting practices require identification of generic reserve funds for certain purposes. These accounts represent the unspendable portions of fund balance, such as inventories and long -term receivables, as well as funds that are legally restricted by some external source, such as debt service reserves and encumbrances. Reserving funds for a contract awarded in one year but not completed until a succeeding year is one example of an accounting reserve for encumbrance. 2. Contingency Reserves. Contingency Reserves represent funds for unexpected financial emergencies. One example requiring the use of this Reserve is the adverse impact of natural disasters such as earthquake or flooding on revenue availability, as well as increased demand for City services. Other examples are unexpected loss or reduction of a key revenue source; special projects, programs, or price changes mandated by another government entity; and emergency capital projects needed to deal with unforeseen structural failure. 3. Designated Reserves. These Reserves are designated for known or anticipated events. Such events require large, non - recurring financial outlay, such as the replacement of systems and equipment or major capital improvements. 4. Stabilization Reserves. Stabilization Reserves enhance the orderly management of the Operating Budget by stabilizing revenues and expenditures, which fluctuate beyond the ability of City staff to control or predict. One example is the annual change in retirement contribution rates mandated by the Public Employee Retirement System (PERS). Other examples are changing prices for utilities and fuel, market value adjustment for investment earnings, and volatility in certain special program funding. In the General fund, tThese Reserves will normally be 2 c J�� F -2 established for specific purposes when significant fluctuations to the normal trend in a particular revenue or expenditure are projected. provide stability by "smoothing out" year to year volatility in the City' finances. FUNCTION AND ADMINISTRATION OF RESERVE ACCOUNTS Reserves are identified below by fund, category and specific function. The specific numbers of accounts where these Reserves are physically located change from time to time as the overall account structure is updated and modified. However, the Fund Balance Statement, which is available for ready reference in the City's Annual Budget document, identifies balances, past -year activity, and projected current year activity for each of these Reserves. A. General Fund. 1. Accounting Reserves. a. Reserve for Inventories. The value of inventories purchased by the City but not yet issued to the operating Departments is reflected in this account. b. Reserve for Debt Service. Funds are placed in this Reserve at the time debt is issued. The provisions governing the Reserve are established in the Bond Indenture, and the Reserve itself is controlled by the Trustee. C. Reserve for Long Term Receivables. This Reserve is used to identify and segregate that portion of the City's financial assets which are not due to be received for an extended period, so are not available during the budget year. d. Reserve for Encumbrances. This Reserve accommodates spending for contracts or other items, which are legally committed but not expended by fiscal year end. 2. Contingency Reserve. This Reserve has a target balance of not less than twelveen percent (17012 %) of annual General Fund expenditures. The City Council authorizes expenditures from this Reserve. 3 r; 3 J F -2 3. Designated Reserves. a. Capital Improvement. Generally accepted governmental accounting practices do not provide for the depreciation of assets of Governmental Funds such as the General Fund. Therefore, special procedures are required to set aside money (a "sinking fund ") for replacement or renovation of fixed assets such as, but not limited to, City Hall and Police Department buildings, Fire Stations, and Library Branches. The Capital Improvement Reserve will accumulate and hold funds only for infrastructure items financed through the General Fund. Infrastructure assets of Enterprise Funds, as well as those of Governmental Fund, for which non - general fund money is available, are not components of this Reserve. Funds from this Reserve are restricted to replacement or acquisition of periodic, major projects or improvements typically exceeding 0.7 percent (0.7 %) of the annual General Fund Operating Budget (not including capital projects). Projects for which this Reserve is intended generally have the effect of extending the useful lives of infrastructure items. The City Manager will update the status of items of the General Fund infrastructure inventory on an annual basis. lReluded of- tke-The City Manager's budget proposal will include provisions to set aside advanced funding for anticipated projects, as described above. The level of advanced funding will be determined by prudent analysis of the overall financial situation during budget development each year. Notwithstanding this analysis, funds set aside for a given project or asset replacement should not exceed be a plan to fund this Reseiwe at a level ef. net Enere than one hundred percent (100 %) of the replaee Rent- _expected cost of each asset by the year in whirh replace Rent at the time the actual expenditure is anticipated. The overall target minimum for this Reserve is $10,000,000. b. Senior Citizen Site. This Reserve is established by Council Policy I -5, which specifies that ten percent (10 %) of revenue collected from rental of facilities at the Oasis Center be set aside for equipment replacement and /or refurbishment at the Center. 4 5 F -2 C. Park Fees. This Reserve contains Park Fees collected by the construction permit process. Use of Park Fees is governed by Council Policy I -1, which limits their expenditure to park, open space, and recreational facilities. d. Off Street Parking. Newport Beach Municipal Code 12.44.025 establishes this Reserve and governs its administration. Fifty percent (50 %) of parking meter revenue collected in designated areas is set aside for acquisition, development, and improvement of off street parking facilities within those areas. e. Paramedic Program (Hoag). This Reserve was established by the City in conjunction with debt issuance agreements with Hoag Hospital. In addition to the original amount(s) deposited to this reserve, effective July 1, 2000, any excess revenues generated by this program, after accounting for General City Overhead of fifteen percent (15 %), shall be deposited to this reserve account for future paramedic related purposes, to a maximttfn of $250,00 Funds in this reserve account may be used for any paramedic related purpose as directed by the City Council. TaF,et level fey tl is operations and eapital expendit-ares, f. Recreational Instruction Reserve. City Council Policy I -2 establishes reserves for surfboard replacement and refurbishment, development of tennis courts, and development of new recreational activities. The Policy requires twenty percent (20 %) of gross annual revenues derived from specified recreational classes be set aside. g. In Lieu Parking Reserve. This Reserve is established by NBMC 12.44.125. The City requires commercial businesses to provide adequate off - street parking. In some cases where this is not possible, businesses are afforded the opportunity to pay an annual fee and use parking spaces in a municipal lot, providing such a lot is located within specified proximity to the business. This Reserve is the repository for these fees. Special purposes of the use of these funds have not been established by the City Council. 5 �c ,%J F -2 h. Park In Lieu Reserve. This Reserve was established by NBMC 19.52. The City requires dedication of land or payment of fees for park or recreational purposes in conjunction with residential development. When fees are paid, the funds are placed in this Reserve. Specific guidance regarding use of the funds is contained in 19.52.030 and 19.52.070. i. Neighborhood Enhancement Reserve A. This Reserve was established by NBMC 12.44.027, which directs that Revenues from parking meters in Zone 9 shall be apportioned to this Reserve. Funds in the Reserve will then be used for the purpose of enhancing and supplementing services to the West Newport area. Both the nature of the supplemental services and the definition of the area served are set forth in the Code Section above. j. Neighborhood Enhancement Reserve B. This Reserve is almost the same as Reserve A above. The difference is that this Reserve pertains to the Balboa Peninsula, and it specifies that fifty percent (50 %) of the parking meter revenue will be apportioned to the Reserve. Specific details are contained in the Code Section. k. Ocean Front Restoration Reserve. In the early 1990's, it was discovered by survey that improvements to several ocean front parcels were encroaching onto the public beach. The encroachment was relatively minor. The negotiated solution was for the property owners to pay a permit fee each year to the City. Revenue thus generated may only be used for ocean front restoration projects and incidental costs of improvements and maintenance to enhance public access and use of ocean beaches as approved by the City Council. This Reserve is the repository for those funds. City Council Policy L -12 contains additional background and details about the encroachment issue. NBMC 12.44.027 establishes this Reserve Account, governs its administration, and defines areas in and purposes for which funds in the account may be spent. 1. Other Designated Reserves. The Administrative Services Director may add additional designated reserves as required. This will normally be done in response to new programs or policies established by the City Council or another government entity 0 5O F -2 providing funds to the City. Examples are the Oil Spill Recovery Reserve and the Public Library Fund Reserve. 4. Stabilization Reserves. r. .e PUMMMM WIM MON. W W1,11101-11 Wi�. t4.-a. Reserve for Appropriations. This is a temporary repository for funds not yet fully appropriated in the annual budget. It is normally used during the budget process to set aside funds for known or strongly anticipated expenses that will need to be addressed by budget amendment during the budget year. Sometimes the dollar amount and /or appropriate account breakdown for such expenses cannot be specifically identified at the time the budget is adopted, even though the funds will be needed. In such cases, the funds will normally be budgeted to the Reserve for Appropriations. &b Change in Fair Market Value of Investments. As dictated by GASB 31, the City is required to record investments at their fair value (market value). This accounting practice is necessary to insure that the City's investment assets are shown at their true value on the balance sheet. However, in a fluctuating interest rate environment, this practice records market value gains or losses which may never be actually realized. In any case, it causes the gains or losses to be recorded well ahead of actual cash flows. Therefore, although actual cash investment earnings may be relatively stable, investment income recorded on the City's books will often be artificially volatile. From a budgeting standpoint, actual cash investment earnings should be considered as available for the annual budgeting process, whereas market value fluctuations should not. Therefore in order 7 r� F -2 to mitigate any such adverse budgetary impact, the City records two Stabilization Reserves related to Market Value fluctuation: Reserve for Prior Year Unrealized Market Value Gains: This is a known value that will be reserved annually during the City's closing process since the early recognition of investment earnings will reduce the investment earnings potential in the new year. (Target Balance = to Prior Year MV Gain) Reserve for Potential Current Year Market Fluctuation: This is a defensive reserve that may be utilized to avail resources during the next budgeting cycle if interest rates rise sharply relative to the investment portfolio's current stated return. (Target should be 2% of General Fund's position in total Investment portfolio). 4c. PERS Rate Reserve. This Special Subdivision of the Stabilization Reserve has been established for the specific purpose of helping to smooth out (for internal budgeting purposes) the year -to -year fluctuations in PERS rates. PERS rates have been one of the most volatile and unstable elements on the expense side of the City's annual budget process. The long -term goal is to budget the normal cost of PERS rates, setting aside the extra money in this Reserve when actual rates are below that level. Conversely, when actual rates are above that level, funds from this Reserve can be drawn upon. At this riling (2003 signifiEant PEES rate increases in the B. Tide and Submerged Land Fund. Within this Special Revenue Fund, special Designated Reserves have been created. Upper Newport Bay Restoration Reserve. This reserve is the repository for funds mandated by SB573, as well as special fees charged to permit holders as an alternative to meeting certain specified mitigation criteria. In addition to the mitigation fees, 10% of Beacon bay lease revenue is placed in this Reserve. Funds in the Reserve are designated for Upper Newport Bay restoration projects. Oil and Gas Designated Reserve. This designation was established by the City with the intent to build a reserve that will provide funding to abandon wells and N. 6 F -2 facilities as they go out of service. Annually, $40,000 will be set aside from the oil and gas field production revenues to fund this reserve. C. Permanent Endowment Fund (Robinson Skinner Annuity). Similar to the above Fund, there is a Designated Reserve within this special purpose Fund. The Newport Bay Dredging Reserve (Robinson- Skinner Annuityl. This Reserve is the repository for the Robinson - Skinner Annuity funds. In general, the endowment specifies that the principal amount will not be depleted, but that investment earnings may be used for dredging projects in Newport Bay. D. Water Fund. (City Council Policy L -20 contains additional information concerning budgeting and rate setting within the Water Fund.) 1. Accounting Reserves. The same four Accounting Reserves identified in the General Fund will also be used in the Water Fund. 2. Contingency Reserve. Water System Reserve. This Reserve is used for emergency repair to the water system. The target level for this Reserve is thirty -five percent (35 %) of the annual budget for operations. 3. Designated Reserves. Future Water Infrastructure Reserve. This Reserve is used for large designated projects that are part of the water distribution system. System replacement/ upgrade and most improvement /major maintenance projects are funded within that amount. However, certain large -scale projects are projected on a ten -year horizon, which is updated and refined each year. The purpose of this Reserve is to set aside partial funding for those projects in advance. Included as part of the City Manager's annual budget proposal will be a plan to fund this Reserve at a level of not more than one hundred percent (100°1%) of the projected cost of planned projects by the year in which contract award is anticipated. Projected future costs notwithstanding, a minimum of ten percent (10 %) of the annual budget for operations will be 9 j F -2 set aside to this reserve each year. The City Council must approve the ultimate fund transfer from this Reserve to a designated Water Enterprise Fund Capital Project Account as part of the Budget process. No new funds will be added to Designated Reserves unless Contingency and Stabilization Reserves are fully funded. 4. Stabilization Reserve. Water Rate Stabilization Reserve. This Reserve is used for water rate or fee stabilization to offset large expenditures changes such as water purchase, energy or treatment costs. The intent of the Reserve is to provide funds to offset cost increases that are projected to be short - lived, thereby partially eliminating the volatility in annual rate adjustments. It is not intended to offset ongoing, long -term pricing structure changes. The target level of this reserve is twenty-five percent (25 %) of the annual budget for operations. Funds will be set aside only if target Contingency Reserve level is met. The City Council must approve use of these funds, based on City Manager recommendation. See also City Council Policy L- 20. Change in Fair Market Value of Investments. This Reserve will be used in the Water Fund in the same manner it is used in the General Fund. E. Wastewater Fund. 1. Accounting Reserves. The same four Accounting Reserves identified in the General Fund will also be used in the Wastewater Fund. 2. Contingency Reserve. Wastewater System Reserve. This Reserve is used for emergency repair to the Wastewater system. The target level for this Reserve is seventy percent (70 %) of the annual budget for operations. 3. Designated Reserve. Future Wastewater Infrastructure Reserve. This Reserve is used for large designated projects that are part of the City's Wastewater system. Funds are reserved for large -scale future projects, which cannot be 10 J F -2 accommodated within the annual budget of the year in which they are planned. In the years prior to estimated contract award, the City Manager's budget proposal will include a plan to set money aside in this Reserve sufficient to accumulate not more than one hundred percent (100 %) of the projected cost of such projects. Projected future costs notwithstanding, a minimum of ten percent (10 %) of the annual budget for operations will be set aside to this reserve each year. The City Council must approve the ultimate fund transfer from this Reserve to a designated Wastewater Enterprise Fund Capital Project Account as part of the Budget process. 4. Stabilization Reserve. Wastewater Rate Stabilization Reserve. This Reserve is used for wastewater rate or fee stabilization to offset large expenditure changes such as energy or operational costs. The intent of the Reserve is to provide funds to offset cost increases that are projected to be short - lived, thereby partially eliminating the volatility in annual rate adjustments. It is not intended to offset ongoing, long -term pricing structure changes. The target level of this reserve is twenty-five percent (25 %) of the annual budget for operations. Funds will be set aside only if target Contingency Reserve level is met. The City Council must approve use of these funds, based on City Manager recommendation. Change in Fair Market Value of Investments. This Reserve will be used in the Wastewater Fund in the same manner it is used in the General Fund. F. Internal Service Funds. Internal Service Funds receive moneys from departmental operating budgets. There are two Internal Service Funds: the Equipment Maintenance and Replacement Fund, and the Insurance Reserve Fund. One of the functions of Internal Service Funds is to act as reserve accounts. 1. Equipment Maintenance and Replacement Fund. The Equipment Maintenance and Replacement Fund receives operating moneys from the Departments to provide equipment maintenance and to fund the regular replacement of major pieces of equipment (mostly rolling stock) at their economic obsolescence. 11 F -2 a. Equipment Maintenance Account. In order to provide adequate funds for unexpected extraordinary costs due to damage or mechanical failure to a large piece of equipment, five percent (5 %) of the total annual budget for equipment maintenance is retained in the Fund. b. Equipment Replacement Account. Departmental operating funds are charged amounts sufficient for the replacement of rolling stock in accordance with Council Policy F -9. Equipment replacement needs vary from year to year; therefore the year -end Fund balance will fluctuate. It will increase substantially in the years preceding major purchases or when an unusually large percentage of the fleet is scheduled for replacement. The City Manager annually determines and adjusts the rates for collection of funds from the Departments based on pricing, future replacement schedules, and other variables. 2. Insurance Reserve Fund. The operating budgets of City's Departments are charged for Liability, Workers' Compensation, and Compensated Absences. a. Liability and Workers' Compensation Accounts. These accounts each serve three purposes: Payment of insurance premiums; Payment of the deductible (self - insured retention) for liability or workers' compensation claims; Reserve for future claims. i. Collection of Funds. Each year, the City Manager will determine and adjust the internal collection rates from the Departments. ii. Short Term Expenditures. The Budget will account for projected expenditures during the coming year. 12 F -2 iii. Future Costs. Money will be set aside each year to accommodate projected long -term cash outflow. The annual funding level will be sufficient to offset the estimated cost of known claims. Resolution of most claims falls within a three -year window. At this time, the target fund balance each year is eighty percent (80 %) of the estimated overall liability for known or anticipated claims, based on the City's general experience in the past. 3. Compensated Absences Fund. a. Background. Employee benefits such as accumulated flex leave, vacation leave, and sick leave, have a cash value. Accounting practices require that the book value of the City's compensated absences liability reflect the cash outflow as if all absences were cashed out immediately. Much of this cash outflow will never occur, since the benefits will be taken in the form of time off, rather than cash. Additionally, the cash outflow could occur all at once only if the City dissolved and made full payment for all accumulated leave amounts. The largest portion of leave -to -cash conversion is at an employee's retirement. That amount can be estimated with reasonable accuracy. b. Policy and Practice. The City will fund an appropriate amount, but not the entire long -term book liability, for compensated absences. i. Each year, the City Manager will project the amount of expected short -term cash liability for compensated absences and budget expenditures from the Compensated Absences Account. ii. The City Manager will establish a target closing balance that will fund not less than twenty -five percent (25 %) of the long- term liability for compensated absences. 4. Retiree Medical Fund Reserve. The City has established a special program whereby medical insurance costs of its retirees are partially offset by limited contributions from the City and members of the active duty 13 r. F -2 workforce. In addition to covering each year's required costs on a "pay as you go" basis, a special Reserve has been established for the long -term accumulation of money to offset the unfunded liability of this program. The City contributes $20 per full -time active employee per month to this Reserve, and each full -time active employee contributes $10 per month. This Reserve is the repository for these long -term accumulation funds. Money in this Reserve is not to be used to partially offset annual costs of the program at any time until the unfunded liability of the program is fully covered by the balance in the Reserve. At that point, funds in the reserve may be depleted for use in paying annual expenses, or replenished each year if inadequate, depending on the status of the unfunded liability. The goal is for the balance in the Reserve to cover the unfunded liability on an ongoing basis. Adopted - January 24,1994 Amended - April 10, 1995 Amended - April 27,1998 Amended - March 14, 2000 Amended - May 8, 2001 Amended - April 23, 2002 Amended - April 13, 2004 Amended - 14 BUDGET ADOPTION AND ADMINISTRATION PURPOSE F -3 To establish the policy for the preparation, adoption, and administration of the City's Annual Budget. POLICY A. Revenues and Expenditures. With rare exceptions, the City's policy is to identify and separately budget and account for revenues and expenditures. However, in some cases the Administrative Services Director may determine that certain funding coming in to the City is more properly reflected as abatement to an expense than as revenue; or that certain expenditures of funds are more properly reflected as abatements to revenue than as expenses. The Accounting Division will keep note of all such entries, and maintain the ability to separately identify the component transactions. Examples of transactions where such recording is often appropriate are earnings on compensating balances, which directly offset the City's expenditures for banking services, and credit card processing charges, which decrease actual revenue received. B. Organization and Development of the Annual Budget. Each year the City shall prepare and adopt, by formal Resolution, an annual budget as required by the City's Charter and as provided for in the City's Budget Instructions. The Annual Budget is published in three volumes, the Resource Allocation Plan (RAP), the Budget Detail and the Capital Improvement Program (CIP). The RAP provides an overview of each department's mission, functions, statistical information, and budget. It also provides summary information regarding the Capital Improvement Program, as well as summary information for budgeted and historical overall City revenues, expenditures, and fund balances. The Budget Detail contains line by line information regarding operating expenditures for the prior year, current year and budget year. The CIP document provides a summary of current and future planned projects, basic descriptions of each project, the funding source and the scope of work to be performed. The City programs expenditures into four classifications. These are Salaries and Benefits, Maintenance and Operations, Other Charges, and Capital Expenditures. Capital Expenditures are subdivided into Capital Outlay, which is generally used for items of operating equipment or other purchases in excess of $500, and 1 F -3 Capital Projects, which generally deal with Public Works related improvements for a distinct and identifiable purpose and function. Policy guidelines regarding budgeting for upkeep and improvement of City buildings are as follows. • Cleaning, maintenance, and minor repair expenses are funded within departmental Maintenance and Operations budgets. This includes janitorial, limited painting, and routine electrical, plumbing, and minor structural repairs. • Most capital equipment outlays are also budgeted at the department level. These include expenditures for furniture (free- standing and most built - ins), carpet replacement, and electronic equipment. • Building expenditures that are for a more substantial and relatively infrequent purpose are funded as Capital Improvement Projects above the departmental level. These include such items as roof replacements, significant plumbing and /or electrical upgrades, or remodels involving structural changes. Budgeted Expenditures for all four classifications are aligned in the Budget Documents by Department Budget Units, which usually coincide with Operating Divisions within the City's organizational structure; and, separately, by Capital Projects. Therefore within each Division Budget, there will be sections for Salaries and Benefits, Maintenance and Operations, Other Charges, and Capital Outlay. During December of each year, the Administrative Services Department shall prepare preliminary fund balance estimates for the current year and preliminary revenue estimates for the next fiscal year. In January of each year, the Administrative Services Department shall prepare a budget calendar and issue budget instructions and expenditure detail to each department for use in preparation of the next year's City budget. Included in these instructions will be budget guidelines and appropriation limits for each department. These guidelines will be developed by the Administrative Services Director and approved by the City Manager. In accordance with City Council Policy F -2 (Reserves/ Designations of Fund Balance), the status and possible changes in Reserve Accounts shall be addressed as part of this process. After submission of revenue and expenditure appropriation requests by each department, the Administrative Services Department shall summarize the 2 ,r;n F -3 requests for review by the City Manager and Department Heads. After review by the City Manager and Department Heads, the Administrative Services Department shall prepare the City's proposed budget for the next fiscal year and shall submit said proposed budget to the City Council. Thereafter, the City Council shall hold as many budget study sessions as it deems necessary. Council budget study sessions shall be recorded. All proposed Council changes in the City Manager's proposed budget shall be added to a budget checklist. Subsequent to Council review and prior to its final adoption, the City Manager shall provide each Council Member with an itemized list of all proposed changes to permit a roll call vote by the City Council on each item during a Council meeting. The City Council shall hold a budget hearing and shall adopt a budget on or before June 30 as required by the City Charter. C. Administration of the Annual Budget. During the budget year, Department Heads and their designated representatives may authorize only those expenditures that are based on appropriations previously approved by City Council action, and only from accounts under their organizational responsibility. In addition, budget expenditures may only be authorized in the year appropriated. Any unexpended appropriations, except valid encumbrances, expire at fiscal year end unless specifically reappropriated by the City Council for expenditure during the new fiscal year. Department Heads are responsible for not authorizing expenditures above budget appropriations in any given expenditure classification within their purview, without additional appropriation or transfer as specified below. 1. New Appropriations. During the Budget Year, the City Council may appropriate additional funds for special purposes by a City Council Budget Amendment. The City Manager has authority to approve requests for budget increases not to exceed $510,000 in any Budget Activity or Capital Project. (This must be specifically included in each year's Budget Resolution to remain valid.) 2. Grants & Donations. The City Manager may accept donations or grants or donations of up to $5000-30,000 on behalf of the City. However, if a new or additional appropriation is required, the City Manager's authority to create new appropriations is limited to $10,000 as stated above. a.ppfepria-tee the fiartds fef the pur-Pese hk#enaca. The City Council will be formally notified of such actions on a quarterly basis by way of the City 3 f) F -3 Manager newsletter to the City Council. (This provision must be specifically included in each year's Budget Resolution to remain valid.) Additionally, grant appropriations approved by City Council may be carried forward to the following fiscal year(s) as long as the grant terms remain valid, the expenditures are consistent with the previous Council authorization, and the funds would otherwise need to be returned to the granting or donor agency. Also, see Council Policy F -25 for specific grant acceptance and administration procedures. Grant contracts and restricted donations in excess of $30 5000 must be specifically approved by the City Council. Often such a grant is approved in advaneeofreeeipt by the City 999• ^8, butOccasionally, the terms and conditions of a grant are approved by City Council in a year prior to when the program activity will take place and }' ^- therefore, the funds are not appropriated to carry out the grant at that time. In such cases, the City Manager may appropriate the funds when they are received, provided the expenditures clearly meet the amount, terms, nature and intent of the grant or donation previously approved by City Council. 3. Assessment District Appropriation. Assessment district projects are typically funded by property owner contributions and bond financing secured by property assessments. City staff will initially seek appropriation to advance City resources for the assessment engineering and the design work related to a proposed assessment district. Since the City's advance is at risk until a district is formed at a public hearing, the appropriation related to advanced resources shall be subject to the normal budget policies. However, once the district has been formed at a public hearing, the City Council will adopt a "project- length" budget for the district and City staff will be allowed to roll the appropriations forward into future fiscal years without rebudgeting the project through the formal CIP process. When assessment bonds are issued to finance the improvements, the bond issuance costs are estimated at the maximum amount that would be required to complete the improvements because it is not known how many property owners will opt to pay the assessment in full during the cash collection period. Finance staff will also have the authority to reduce Council appropriations (related to bond issuance costs) after bonds are resized and sold. 4 it F -3 4. Transfers. During the fiscal year, actual expenditures may exceed budget appropriations for specific expenditure line items within departmental budgets. If a total departmental budget, within a specific Classification, is not exceeded, the Administrative Services Director has the authority to transfer funds within that Classification and Department, to make the most efficient use of funds appropriated by the City Council. (Salaries and Benefits, Maintenance and Operations, Other Charges, and Capital Expenditures are the City's four Classifications.) 5. Realignments. Further, funds may be realigned between one Department Budget Activity and another, within the same Classification, with City Manager approval. For example, if a Fire Department function and the employee who accomplishes it are replaced by a slightly different function assigned to the Police Department, the City Manager may authorize the transfer of appropriate funds to support this function. 6. Reprogramming. Any reprogramming of funds among the four Classifications (Salaries and Benefits, Maintenance and Operations, Other Charges, and Capital Expenditures) within a given fund requires the City Manager's approval. Any budget revision that changes the total amount budgeted for any fund (other than the minor provisions contained in paragraphs B.1. and B.6.b.) must be approved by the City Council. 7. Capital Projects. The Department Head having primary responsibility for a Capital Project (usually the Public Works Director) is authorized to encumber and approve subsequent expenditure of City funds for Capital Projects. However, contracts in excess of $30,000 require specific City Council authorization at the time of contract award. In addition, any contracts not of format and wording already approved by the City Attorney require specific City Attorney review and approval prior to contract award. Once a contract has been awarded, change orders may be approved by the Public Works Director, or other Department Head having responsibility for the Project, so long as the net total amount committed to the Project remains below 110 percent of the original contract award amount; and so long as the original amount appropriated for the Project by City Council is not exceeded. C� � F -3 Change orders exceeding the above thresholds may be approved by the City Manager as follows: a. Total spending for any single contract may not exceed 125 percent of the original contract award amount without City Council approval. In certain situations the Public Works Director and the City Manager may determine that a change order exceeding this 125 percent threshold is needed, and that the timing is such that a work stoppage or other undesirable consequence will result if approval of the change is delayed until the next City Council meeting. In those instances, the City Manager may approve a change up to 150 percent of the original amount. However, the City Manager will notify all City Council Members individually if this situation develops, and if there are any objections to the increase, a special meeting of the City Council will be called to address the issue. b. The total amount authorized for a capital improvement project may be increased by transferring funds from one Project to another or by reprogramming funds from any of the other three classifications (see C.5), so long as the new total does not exceed 110 percent of the original amount appropriated by Council. C. In the event that the transfer or reprogramming action in C.6.a. or C.6.b. above would result in a material reduction in the scope of the capital project or other City activity from which funds are to be withdrawn, City Council authorization is required. For example, the movement of five percent (5 %) of the funding from one large project to another large project of the same general category could be approved by the City Manager, whereas the elimination or significant reduction of two small, unrelated projects to provide funds for a five percent (5 %) increase in a much larger project would require City Council approval. In all instances, notification of any changes to capital project contract amount or budget authority must be communicated to the Administrative Services Director. All unexpended and unencumbered capital projects will be canceled on June 30 of each fiscal year. The appropriation balance of these canceled C: 70 F -3 projects will be recorded in the Reserve for Capital Improvements or another appropriate Reserve Account by the Administrative Services Director at fiscal year end (see also paragraph D.2. below). 8. Reserves. Funds from unappropriated contingency reserves may be transferred to active Classification accounts only by City Council Budget Amendment. D. Additional City Council, City Manager, and Administrative Services Director Responsibilities. The Administrative Services Director is responsible for checking purchase requests against availability of funds and authorization as per the approved Budget. The City Manager is responsible for approving expenditures which do not conform to the approved Budget, but which fall within the exceptions noted in this policy statement. It is the responsibility of the City Manager to administer the City's budget within the framework of policy and appropriation as approved by the City Council. I. Special City Council Expenditure Approval. Once the final Budget has been approved by the City Council, specific City Council approval to make expenditures consistent with the Budget will not be required, with two exceptions (see also Purchasing and Accounts Payable Procedures): a. Capital Projects in excess of $30,000. b. Consultant Contracts in excess of $30,000. All other budget administration actions, including the routine filling of vacancies in staff positions authorized within the Budget, will not require further City Council approval. However, new positions and other new expenditures do require City Council approval, and the City Council and City Manager reserve the right to impose any special fiscal control measures, including a personnel hiring freeze, and other spending controls, whenever circumstances warrant. Since the annual Budget is approved by formal Resolution, a request by a City Council Member for review of a portion or portions of the Budget, with a view toward changing amounts appropriated or the purposes for which they were appropriated, requires a majority vote of the City Council. 2. At fiscal year end, the Administrative Services Director is authorized to realign, reprogram, and/or transfer money among accounts within each Fund in order to close the books of accounts of the City of Newport Beach 7 171 F -3 in accordance with generally accepted governmental accounting principles as established by the Government Accounting Standards Board, Government Finance Officers Association, and other appropriate accounting or auditing pronouncements. Any net shortage within a Fund will be recorded as a decrease in Fund Balance and reported to the City Council. Any net excess will be recorded as an increase to one or more appropriate Reserve Accounts as recommended by the Administrative Services Director and approved by the City Manager. (Information regarding appropriation of Funds from the Reserve Accounts is contained in City Council Policy F -2.) Adopted - January 24,1994 Amended - February 27,1995 Corrected - February 26, 1996 Amended - May 13,1996 Amended - May 26,1998 Amended - August 8, 2000 Amended - May 8, 2001 Amended - April 23, 2002 Amended - April 8, 2003 Amended - April 13, 2004 Amended - Formerly F -10, F -11, F -12, and F -21 E ANNUAL AUDIT PURPOSE F -15 To establish City policy regarding contracting for annual audit services from an external accounting firm. POLICY Consistent with the practices of other cities, as well as larger corporations in the private sector, the City Council retains the services of an external accounting firm to audit the City's financial procedures and records on an annual basis. The primary staff point of contact for this contract and the day to day work done by the auditors is the Administrative Services Director, but the auditors will have direct access to the City Manager or City Council on any matters they deem appropriate. The financial statement audits will be conducted in accordance with generally accepted auditing standards as promulgated by the American Institute of Certified Public Accountants in their audit guide, Audits of State and Local Governmental Units, and will accordingly include such tests of the accounting records and such other auditing procedures. The accounting and reporting principles adopted by the Governmental Accounting Standards Board will be applied. The compliance audit, the Single Audit, of the City will be performed as a single audit as defined in Office of Management and Budget (OMB) Circular A -128 Audits of State and Local Governments. The audit will encompass all Federal funds administered by the City. Furthermore, it will be conducted in accordance with the provisions of: Government Auditing Standards (1988) promulgated by the U.S. General Accounting Office, which pertain to financial and compliance audits; Compliance Supplement for Single Audits of State and Local Governments. After soliciting and receiving written proposals from interested accounting firms, the City will normally award an audit contract for a threefour -year period. The audit contract may be renewed for an additional tlffeefour -year period, without going through a new invitation for bid procedure, with the same firm, if the City Council is satisfied with the performance of the auditors and authorizes the extension. Only one such extension is authorized without going through formal bid procedure. 1 rf �5 F -15 After audit results have been communicated to the City, the Administrative Services Department is then responsible for responding to all findings within six months to the City Council and appropriate regulatory agencies. Adopted - January 24,1994 Amended - February 27,1995 Corrected - February 26, 1996 Amended - Formerly A -14 9 GRANT ADMINISTRATION PURPOSE F -25 To establish guidelines for the application, acceptance, administration, and financial reporting of grants including, but not limited to federal, state, local, and restricted donations (also considered grants for the purpose of this policy). POLICY A. Grant Application and Responsibility Individual departments are encouraged to investigate sources of funding relevant to their respective departmental activities. The individual department applying for a grant or receiving a restricted donation shall generally be considered the Program Administrator of the grant. The Accounting Division of Administrative Services may assist in the financial administration and reporting of the grant but the Program Administrator is ultimately responsible for meeting all terms and conditions of the grant, insuring that only allowable costs are charged to the grant program and is responsible for adhering to City budgeting and fiscal procedures. Individual Departments and Program Administrators are not authorized to execute grant contracts. Grant contracts should be reviewed by the City Attorney's office and executed by the City Manager and or City Council. B. Grant Acceptance & Appropriation by City Council Even though the funding source for an activity may be provided by a grantor /donor, only City Council can appropriate funds for official City activities except as authorized by Council Policy F -3 (Budget Adoption and Administration). Therefore, prior to the acceptance of a grant, the City Manager and City Council shall: 1. Approve the terms and conditions of the proposed grant including the specific City obligations that may be created by the grant contract in terms of required City matching expenditures or staff activities, even if the expenditures were previously appropriated through the budget adoption process. 1 rIV IJ IC6 i 2. Approve budget appropriations for the grant expenditures and City matching expenditures unless previously appropriated through the budget adoption process. 3. Approve and execute the Grant Contract(s). Note: The City Council review and approval of items 1 and 3 are not required if the grant is under $30,000 however, Council expenditure appropriation is required for all new appropriations in excess of $10,000 or as otherwise specified by Council Policy F -3. Any budget amendments requested by the Program Administrator or operating department shall be reviewed by the Accounting Division of the Administrative Services Department and submitted as a staff report to the Council for their review and approval. The Accounting Division of the Administrative Services Department along with the Program Administrator shall determine the proper amount of the appropriation request during the current and future fiscal year(s). C. Timely Reimbursement The Program Administrator is responsible and should pursue and /or request grant reimbursements or draw -downs on a timely basis. If requested, the Accounting Division of the Administrative Services Department will assist with grant reimbursements or draw - downs. All checks shall be made payable to the City of Newport Beach and remitted to Program Administrator. Grant checks should be deposited immediately with the City Treasurer along with supporting documentation received by the Program Administrator. Copies should also be forwarded to the Accounting Division of the Administrative Services Department. The Program Administrator will keep the Accounting Division of the Administrative Services apprised of the annual estimated grant revenues and expenditures and a tentative schedule of cash -flows for the grant program. D. Financial and Grant Reporting Grant reporting requirements vary widely by grant and sometimes include monthly, quarterly, and or annual reporting. Subsequent to the approval of a grant application, and during the project period, any required reports shall be 2 1/0 F -25 the responsibility of the Program Administrator, or if requested by the Program Administrator, the Accounting Division of the Administrative Services Department. Program Administrators submitting their own reports shall forward a copy of each report to the Accounting Division of the Administrative Services Department. E. Grants Containing Direct Federal Assistance of Federal "Pass- Through" Funds Program Administrators acknowledge that Federal Funds or Federal Funds that "pass- through" state and local programs are required to be reported on the City's Schedule of Federal Financial Assistance and included in the City's annual Single Audit (compliance audit of all Federal Funds). Program Administrators will identify and keep the Accounting Division apprised of those grant programs that contain direct Federal Funding or Federal pass - through funds identifying the Catalog of Federal Domestic Assistance (CFDA) number when at all possible. F. Record Keeping & Retention Requirements For the purpose of Grantor inquiries and grant specific compliance audits, Program Administrators are responsible for maintaining adequate records to evidence that program activities and expenditures met the terms and conditions of the grant and that all grant reporting requirements were met timely. Record retention requirements vary by grant but it is recommended that grant records should be maintained for a minimum of the life -of- the -grant plus three years, unless otherwise specified by the grant contract. G. Documents to be forwarded to Accounting: Information received from a granting or donor agency that is pertinent to the terms, conditions, approval, extension, denial, revocation, and administration of a grant shall be forwarded to the Accounting Division of the Administrative Services Department including but not limited to: Grant Award Notification Expenditure Authorization Date (if applicable) Grant Contracts Grant Extension Letters Grant Termination Letter Program and or Financial Reports Notices of Questioned Costs or instances of non - compliance W Any Document setting or modifying terms and conditions of the grant Adopted - 2005 IwdQ C! 7� DRIVEWAY APPROACHES GENERAL L -2 A. A permit will be required prior to any driveway construction within the street right -of -way. All construction shall conform with the Standard Plans and Specifications of the City of Newport Beach. Brick, textured concrete or flat stone surfacing may be used subject to Public Works Department approval. Such brick, textured concrete or flat stone surfacing may not be used on Bayside Drive. B. The number of driveway openings shall be kept to a minimum so as to preserve on- street parking and to reduce the points of traffic conflict. C. The term "Curb Opening" shall mean the total width of the approach including the slope distances on the curb. The term "Approach Bottom" shall mean the total width of the approach less the slope distances on the curbs. D. Curb openings shall not be constructed closer than 5 feet to the beginning of the curvature of a curb return, fire hydrant, traffic signal/ pedestrian street light, utility pole /anchor /pedestal, trees or vent pipe, unless approved by the Public Works Department. E. The entire curb opening shall be within the prolongation of the property lines except when cross easements provide for a common driveway along the mutual property line. F. No permit shall be issued for driveways on Clubhouse Drive, Glen Drive, Balboa Island or on the ocean side of Ocean Boulevard without City Council approval. No curb openings will be permitted on Ocean Boulevard when access is available from an existing alley, street or improved private roadway. G. No permit shall be issued if the driveway construction requires the removal of a street tree until such removal has been approved by the General Services Director. H. No permit shall be issued if the driveway encroaches on a crosswalk area. I. No permit shall be issued if the driveway construction requires the relocation of any public facility such as fire hydrants utility pole /anchor /pedestal, tree, vault, vent pipes, or street lights until approved by the Public Works Department and a 1 L -2 deposit has been made to cover the cost of relocation. Property owner shall pay all costs for the relocation of any public facilities. J. No permit shall be issued unless the applicant agrees that at no cost to the City he will remove any driveway opening that is or will be abandoned, and reconstruct curb, gutter and sidewalk (if applicable) to City Standards. K. Where practical, difficulties or hardships may result from the strict application of this policy, minor dimensional variances may be granted with written approval of the Public Works Director. L. Nothing herein shall be construed as preventing any person from appealing to the City Council for relief from the applications of this policy. M. No building permit shall be issued on a parcel whose access requires City Council review for an encroachment permit on public property, until said encroachment permit has been issued. RESIDENTIAL ZONES AND RESIDENTIAL USES - SPECIAL REQUIREMENTS A. The width of the driveway approach bottom shall not exceed 20 feet except when the driveway is to serve an enclosed three or four car garage, in which case the driveway approach bottom may be increased to 25 feet or 32 feet, respectively. B. One additional curb opening will be permitted to a single parcel subject to the following conditions: 1. The total width for all openings shall not exceed 50% of the total frontage of the parcel. 2. The openings shall be separated by at least 20 feet to retain maximum street parking. C. Street curb openings shall not be permitted to residential property which abuts an alley. An exception may be made in the case of corner lots where the street on which the curb cut is proposed is not an arterial street and street frontage is available for the full depth of the lot, subject to the following conditions: PJ �J 11a 1. Access from the street will be permitted where existing structures prevent full alley access, or additional covered off - street parking is being provided. 2. The width of the curb opening shall be limited to one -half of the lot depth. 3. The preferred design for a duplex or two -unit condo development provides for separate detached units or units attached by a common vertical wall and/or open space in accordance with applicable building codes. The resultant housing product informally subdivides the property to allow for separate units, front and back, with garage access for one unit on the alley and the second garage access on the side street to provide physically separated units that are more harmonious for the tenants /owners. 4. The street curb cut will not be allowed to provide access to anv of the required spaces. D. Driveway grades must not exceed the listed applicable maximum slope depending on application. Driveways to lowered or subterranean parking must rise above the flood level or a minimum of six inches above the flow line of the street or alley, whichever is greater, before transitioning to a downward slope. Slope transitions shall be a minimum of five feet in length and the change of slope cannot exceed eleven percent. Driveways providing only Barking access - Fifteen- percent maximum slope. Must have access directly from garage into residence. Driveways providing vehicle and pedestrian access - Eight- percent maximum slope. Driveways providing required parking spaces on the driveway itself - Five - percent maximum slope. Minor variations from the listed maximum slopes and slope changes may be granted by the Traffic Engineer when unusual site conditions are encountered. PRIVATE STREETS - SPECIAL REQUIREMENTS A. A grading permit will be required prior to the construction of any driveway apron, sidewalk, curb, gutter or wall within the private street rights -of -way. The 3 L -2 design parameters shall be in accordance with the City of Newport Beach Design Criteria and Standards for Public Works Construction. Also, the Public Works Department shall perform a brief review of plans prior to permit issuance. B. A Public Works encroachment permit will be required if improvements are to be constructed within 5 feet of a fire hydrant, street light or other public utility system appurtenance (i.e., valve boxes or manholes). C. A Public Works encroachment permit will be required when connecting to or relocating public utilities. COMMERCIAL USES A. The width of the driveway approach bottom shall not exceed 35 feet. B. The total width of all driveways shall not exceed 50% of the frontage of the parcel. C. Commercial driveway approaches may use a curb return design with a maximum curb radius of 25 feet and a driveway approach bottom of greater than 35 feet if the following conditions are satisfied: 1. The driveway serves as an entrance to a parking area or structure for 200 or more vehicles. 2. The number of driveways serving the parcel are at a minimum. D. The curb return commercial driveway approach may incorporate a divided exit and entrance if the separation structure (median island) is continued on -site in such a manner as to provide proper traffic design. CLOSURE OF ABANDONED DRIVEWAY APPROACHES BY CITY The City may close abandoned driveway approaches at high priority locations where two or more of the following criteria may exist: 0 L -2 A. The abandoned driveway approach is adjacent to a parcel of property where redevelopment and possible subsequent closure of the approach is not believed imminent; B. The driveway approach is at a location where there is a shortage of available on- street parking; C. The removal of the driveway approach is needed for safe pedestrian and /or bicycle passage; D. The closure of the abandoned driveway approach benefits not so much to the property owner as pedestrian and vehicular traffic in the area. When in the opinion of the General Services Department and /or the Public Works Department, a curb cut or abandoned driveway approach should be closed, and the adjoining property owner protests the closing, the protester shall be notified that he will have two weeks to appeal the staff decision to the City Council. That appeal must be in writing and may be filed through the mail. If an appeal is not made, the City shall proceed with the closure. If an appeal is made, a hearing shall be held by the City Council, and the decision of the Council shall be final. Nothing in this section shall be construed as relieving adjoining property owners from the responsibility for closure of abandoned curb cuts as a condition of permit approval for new construction or for obtaining a curb cut permit for an alternative driveway location on the same parcel. Adopted - January 24,1966 Amended - February 26,1968 Amended - July 24,1972 Amended - November 14,1977 Amended - October 25,1982 Amended - July 13,1987 Amended - November 27,1989 Amended - December 14,1992 Reaffirmed - January 24,1994 Amended - February 26,1996 Amended - May 8, 2001 5 �lJ�