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� � 6 prospective legislation, noting that the Legislative Analyst has re- ported a rather bleak forecast. Mr. Fales continued, stating that the proposed 1979-80 Annual Budget will not make any assumptions about the possible receipt of "bail out" funds, since information will �robably not be available until �^ late May when the proposed Budget already will have been submitted to Council . He noted that Council can make the policy decision as �;� to the use of funds, if and when they are received. He said that he would probably recomnend that the much needed maintenance of the City's capital plant be undertaken, observing that if it is permitted to deteriorate further, major costs can be expected soon. Discussion followed and Mr. Fales and Director of Finance Ference corr�nented and replied to questions concerning the State Controller's interpretations of rese rves; the apparent desire of the Legislature that reserves be spent since cities which do not have reserves are to be awarded greater "bail out" funds; the possibility that the Legis- lature may divert an additional two cents of sales tax directly to local governments with one cent awarded 6ased on need and popula�ion and the other based on point of origin; whether restraints on cost- of-living increases will be continued; the fact that the League of California Cities is working on a "Cities Tomorrow" report regarding certain reorganization which may permit cities to be more effective at less cost in some areas and that representatives of private in- dustry are on the committee also; the lack of desire of Council to accept State funds with "strings" attached; the need for legislation defining "non-cash" items and determining whether June 30 or July 1 should be used by the State Controller; the fact that use of the State surplus for local government services was one of the arguments �,,,,, presented in support of Proposition 13; and the diminished capacity of cities to make decisions ]ocally as a result of the Proposition. � Mayor Barrett noted the presence in the audience of inembers of the Chamber of Commerce who wish to raise the issue of participation by the City in that organization which promotes business vitally beneficial to the City. He suggested the participation might be tied to a source related to Chamber activities such as the business license tax or the hotel/motel tax. Discussion followed and Mr. Fales commented and rep��ied to questions concerning the fact that most cities levy bu�iness license tax based on gross receipts rather than a flat fee; whether increasing business license taxes to include an amount for Chamber support might not cause businessmen to drop direct support of the Chamber; the fact that those who refuse to join the Chamber benefit from it at no cost to themselves now; the Chamber's need for income growth in order to have the funds necessary to bring in new business; and the desire of Council to welcome business. Bob Fou1k, Chamber of Commerce, stated he would prefer a stronger re- lati.onship between the City and the Chamber. MOTION: Councilman Leipzig moved, seconded by Councilman Biagi , to refer the matter of City participation in the Chamber of Commerce +�*-� to staff for review and recomnendation. �,,�, The motion carried unanimously by voice vote. (MINUTE ORDER N0. 79-35� (Council recessed from 10:40 to 10:50 a.m. ) . Adj.Mtg. 2/12/79 Page 2 � .. ��