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6.1.A. - Page 16 Dr. Robert Bell provided the initial opening remarks stating that Redwood City has embraced a multi-prong approach that has served the City well. He noted some economic climate changes such as the demise of the Redevelopment Agency (RDA) but generally the expected deficits fall within the estimated ranges. He outlined the agenda for the evening which included his introductory remarks, followed by the comments from the Finance Director, Community Development Director Ekern's. Thereafter, Council discussion and direction. Mr. Ponty (presentation on file) began by discussing national high level items and then zoomed in the City's budget followed by an analysis of reserves. Mr. Ponty covered the unemployment rates for the nation and statewide and in San Mateo County. He noted that last year 48,000 jobs were created in San Mateo County. However, the assessed valuations have not seen an increase but the hope is that the trend of additional jobs will spread to increased valuations. Mr. Ponty believes the future deficits look manageable however there are uncertainties like RDA and PERS. He reassured Council that his assumptions were conservative. Council Discussion: Various Council Members inquired about the assumptions. In regards to the RDA funds, Mr. Ponty believes that some of the money that will come back will be used to backfill the current fiscal year expenditures, and for the future, staff will make recommendations on what to cut. Mr. Bill Ekern then spoke about the RDA and the fact that the recent actions will dissolve the RDA. He noted that staff is in the process of putting together an inventory of housing and assets and there is a lot of complexity around these issues. He noted that Sequoia station is a signature project from the RDA. He congratulated the Council on the last 30 years of projects which have revitalized the downtown. Mr. Ekern commented on the ongoing programs that attract people to our downtown. The enforceable obligations document was briefly touched upon as it then becomes the document upon which the funds return to the City. He also mentioned that there are about 2 million dollars in salaries spread through the City and staff is trying to sort this out. City Manager Bell will look at further shared services and regionalization. There are a variety of these items on the shelves. One Council Member feels uncomfortable about having no contingency and he would like to have a cushion; and, as Council moves forward, he wants Council to consider options and not just backfill RDA. He opined that regionalization and shared services still need to be on the table. Another Council Member wants to have contingencies and options should things not go well. Dr. Bell reiterated that staff is ready to review the array of services and RDA assets and have Council decide what to keep and let go. He confirmed that the goal is a Status Quo budget for current fiscal year and use reserve money for RDA takeaway for the current year. He also said that staff will continue on the three-prong approach and continue finding redundancies, restructuring, looking at vacancies, combining departments, and working on using technology as much as possible. He spoke about CITY COUNCIL February 6, 2012 MEETING MINUTES PAGE 7