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Good morning.

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Good morning, and welcome to the February 28th meeting of the Santa Cruz County Board of Supervisors. Could we start with a roll call?

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Supervisor Friend, Coonerty, Caput, McPherson, Terry Leopold.

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Here.

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We start this meeting with a moment of silence in the Pledge of Allegiance.

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Today's moment of silence, I'd like to remember a member of the county family who passed away unexpectedly.

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I want to refer a little bit from his obituary, Bill Manov was a long time resident of Santa Cruz who recently retired after 28 years of dedicated public service as the Santa Cruz County alcohol and drug program director.

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For more than 41 years, Bill served tirelessly as an advocate in the field of substance use disorder treatment.

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he was a community builder who positively impacted the lives of many people in need.

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More importantly, Bill was a kind and caring human being who never failed to bring a smile to those around him.

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His positive outlook on life was infectious and his capacity to love boundless.

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Bill was always took time to hear what others had to say and his wise counsel and good humor left everyone in his orbit better equipped to face their challenges.

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At home, Bill was completely devoted to family and his favorite told memories were centered

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on the rich life he shared with them.

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Bill adored his children and through them found great hope for the world in its future.

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Bill's great love and music found expression in his guitar playing with a local blues band

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for many years in his talented songwriting.

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More recently he had begun to explore the wonders of the jazz guitar.

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Bill loved nature, particularly its majestic high mountain ranges.

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He could frequently be spotted along nature's hiking trails with his backpack or skiing its graceful slope.

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On behalf of the board, I just want to share that our thoughts are with his family during this difficult time

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and may his memory be a blessing.

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And as we take our moment of silence, please think of Bill and his contributions.

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Good

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morning, Ms. Morello.

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Are there any late additions to the agenda?

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Good morning. We do have a few. I want to thank you for those kind words about Dr. Manoff. We're all going to miss him very much.

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Today there are public comments that are related to specific items on the agenda that are available for viewing electronically on the county's website.

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In addition, we have a number of changes on the consent agenda item 15. We have additional materials which is an administrative form 29

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line for the multidisciplinary interview center facility lease.

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That's attachment B. On item 32 we have a replacement board memo.

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The subject line is corrected to read by annual report of the first five commission.

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We have an agenda to the consent agenda which is item 46.1 to accept the letter opposing

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Governor Brown's decision to cease operation of the coordinated care initiative and dismantle

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the county in-home supportive services maintenance of effort, cost sharing, arrangement, and directing

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the chair to write letters as outlined. And that says recommended by Chair Leopold and

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Supervisor McPherson. With that item, we have a letter of the two Supervisors'

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date of February 23rd, 2017. On the regular agenda, we have item 51. We've listed that as

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additional materials, there's a corrected board memo, we did have a bit of a computer

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challenge on this item, the agenda back at materials were correct, however there was

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a web link for this item which was incorrect and some of the members of the public may have

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seen the old version of that memo via the link.

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The problem has been corrected and in an abundance of caution the correct version was also included

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as an attachment so people can have their attention drawn to it.

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So, with that, I think that's it for this morning.

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Okay.

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Thank you.

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Next, I'll go to members of the board.

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If there are items on the consent agenda that you'd like to comment on our pool,

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now would be the time.

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Good morning, Supervisor Coonerty.

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Good morning.

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Good morning, everybody.

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Thank you for coming.

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Three items I wanted to briefly talk about today on the consent agenda.

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The first is item number 13 with a status report and an update on homelessness prevention.

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I want to appreciate the work of our homelessness coordinator, who's both solved sort of short-term

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crises around the winter shelter as well as starting to put into place long-term efforts.

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Going forward, I think it's helpful for the board to actually get the actual numbers on

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the number of people housed or people who are prevented from becoming homeless by program

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So that we can see how each one of these programs is doing on a regular basis and evaluate

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where we're investing our dollars to prevent serious crisis in our community.

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On number 17, which is looking at solar installations, I'm potentially five sites around Santa

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Cruz County on Santa Cruz County property, I'm glad this is moving forward.

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It's been in progress for a while.

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Two years ago, this board set up a goal which would be to have 40% of our energy, meaning the county's institutions, power, come from renewables.

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And I think the installation of these solar facilities or solar opportunities can move a long way towards reaching that goal.

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And finally on item number 39, which is the roads, there obviously have been tremendous

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impacts.

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The roads that are designated today as a priority working with federal and state, the federal

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and state governments.

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One of the roads is not on a list of swan, which is severely impacted in having a real impact

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on our fire department's ability to have response times on the coast.

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And I'm hoping while this, it doesn't fit under this category, I'm hoping that we move it forward under any measures we can and make it a priority.

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So thank you very much.

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Thank you, good morning, Supervisor Friend.

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Good morning, Chair.

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I have nothing to pull just a couple of brief comments on item number 15, which is the District Attorney's Multidisciplinary Interview Center.

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this is a significant step forward to ensuring that victims of crime, especially younger victims

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of crime, have an opportunity in a safe location to have the issues handled for them right

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now.

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The way that it works is that multiple agencies end up coming in to different locations.

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Victim actually has to go to either multiple locations or deal with different types of people

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during a traumatic event.

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This brings us in line with a lot of other best practices, but the state into one safe, secure

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location is designed exactly for this and really is victim forward and I appreciate the district

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attorney taking the lead on that. On item 36, just honoring the president of the Land Trust,

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Terry Corwin, who's retiring has done a lot to ensure agricultural and open space protections and

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also ensuring that the community has access to both. She has a remarkable legacy that this county

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will forever be grateful for so I appreciate that the board is recognized around that and I appreciate

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Supervisor Leopold taking the lead on that.

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Item 39, again, regarding the roads and the letter to Cal Transistor Director, five Tim Govins.

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I held a pretty large community meeting last night regarding Valencia with public works and

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public safety agencies last night and I appreciate that these roads are listed on there and

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I appreciate the continued work I recognize that there has been a significant amount of work by county staff.

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Especially public works, not just to try and restore these roads, but

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to go through the state and federal process to expedite it.

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It is, as they know, and many of the community know,

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people are very concerned about access

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and about what the next stage would be

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if we're unable to restore some of these access components

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and this work through Cal Transit is the best way

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to expedite that process.

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I appreciate Public Works taking the lead on that.

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The last item is just item 42,

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regarding the C-cliff Village Street Skate Plan

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and State Park Improvement Project.

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This is long awaited by the community there

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We'll make a significant improvement to the access to the State Park and for

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Apptops in general, and so I appreciate that, even though we've got a lot of other emergency items going on that long-term projects are still being seen through by Public Works, I wanted to commend them for continuing to do the day-to-day operations as well.

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Thank you, Chair.

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Thank you. Good morning, Supervisor Caput.

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Thank you.

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Yeah, I'll just make a comment on item 38.

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I think it's good we're lowering the for the requirement for first time home buyers.

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Normally they would have to come up with 5% for an affordable house that's in the program.

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And we're lowering that to 3% for the down payment.

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That makes it a lot easier, it'll be instead of coming up with the down payment for lower

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lower income families from $26,000 down payment down to about $15,000.

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So it helps people especially with high rents today and everything the job market is, you

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know, and everything combined the price of homes in Santa Cruz County is actually running

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away from your lower middle class and middle class being able to buy a home in Santa

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I don't know how many homes are available if anybody has that figure that are actually available in the county for first time home buyers that can participate in this program.

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I'm not sure that we have that number available this morning, but we'll see what we could find in and get somebody to send your memo about that.

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Good morning, Supervisor McPherson.

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Thank you.

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I too would like to address item number 11 and 39.

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I think this is the third continuation or fourth, maybe,

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a continuation of our emergency natural disaster declaration.

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And it just seems to keep going on.

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Thank heavens we have a little sunset on today.

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But I think we're nearing the estimated $40 million mark.

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I don't know, I do know that we're going to have a discussion on budget items later today,

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but I don't know if we should have an update from the public works director.

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I think we have 130 disaster sites, $40 million.

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You had a community meeting.

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I know up in the summit area I did last night, also from the Los Cumbres at Lakeside School

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the last night was Santa Clara Supervisor Mike Wasserman about the situation.

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We're taking a little, we're trying to get some emergency funds for four major roads,

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as was mentioned, and get so we can move very quickly on those.

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I would like to mention too that Nelson Road was a rather innovative way to get a bridge

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It take two railroad flatbeds from railroad cars and put them across what was turned into

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a river and now they have access to their places for those 30 to 50 residences.

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I don't know if it's ingenious but it's a very, very clever way to do it and they have

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their access as they need it so that's great.

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I on item 25, project five, I think this is terrific that in line with the few foundation policies to increase our public safety efforts for those services of victims and to reduce the recidivism of survivors of violence as well, but that's very, very important and I appreciate that.

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I also, you scant over it, thank you for your discussion or your introduction on Bermanteau.

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Manoff, he was a fantastic person, did so much for so many people and was a leader in

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that field that he was in, and he loved it, and people loved him for what he did.

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And I can also say the same for the Terry Corwin, and thank you for getting the resolution

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for her. She, at the Land Trust of Santa Cruz County, has made that an example of how to

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go about getting a community behind preservation of our natural resources. She has been fantastic

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for 11 years as a leader of that agency. And we appreciate her efforts through the years

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very much too. Thank you. Thank you. I don't have any items to pull. I'll just comment on

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a couple of them on item 18, I know we're going to be returning on June 6th for this water

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tender because they're still working on it, but this is a great example of a community

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stepping up and raising $350,000 to purchase a water tender for the Loma Prieta Fire Department

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and it's all part of County Fire and I appreciate the work of mountain residents and the ongoing

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going relationship we have with Cal Fire and County Fire.

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On item number 37, I think it points to the difficulty, as always, in building affordable

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housing, when you have resources but you don't have a project, it creates a lot of problems

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and I want to remind the board that where we can build housing is part of housing developments

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that's always a good strategy because even as we see here, even with money, it takes

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It takes a lot to build a multi-family housing project.

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On item number 39, I'm really glad to see SoCal San Jose Road on this.

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There's a lot of roads in crisis in the first district.

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This is obviously a hugely significant road not only to district

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I know there's been some extraordinary work that's gone on by public works, geotext staff, and looking at creative ideas. And hopefully, CalTrients will recognize the prioritize these four roads so we can get them up and running as quickly as possible. On item number 43, I just want to recognize our parks department as well as our public works department for doing this property exchange to help with the heart of SoCal Parkway project.

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This is a, we've built a beautiful park, we're trying to make sure that it links up with

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all of SoCal to make it a more pedestrian friendly community.

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In addition to this work, we've recently met with the SoCal School District,

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who's going to make land available at the back of SoCal,

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a entry to complete this to the bridge over to Lyon Street Park,

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which will make basically all of SoCal easily to walk.

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So this is an exciting development for SoCal and I want to thank the staff for their work on it.

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With that, I'll look to see if there's members of the public who want to address us on items on the consent agenda.

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Good morning, Ms. Dineburner.

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Good morning, and thank you.

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And I want to thank you for all of your good work.

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These are very trying times, and I recognize that and I know you're nerd a lot of stress with all the storms, and I just want to thank you for all your good work.

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I do want to

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call into question item number 15 expenses and I looked into the documentation.

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I think this idea is very good in terms of making a multidisciplinary interview center

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for these people, these young people.

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But what I want to ask is if there isn't some place that the county already has, maybe even

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the school district, just we've got a huge, huge debt in front of our county with everything

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we have to repair.

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And I think we've got to start really looking at these outside contracts, $35,000 to hire

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a consultant to find a place and then another $30,000 a year to secure the place.

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And I just think, it's adding up and to that end, I also want to bring a similar concern regarding Bowman-Williams and

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the Seacliff Village streetscape, adding another $50,000 onto their $331,000 contract.

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that $50,000 is for them to manage the contractors and again, that's $50,000 that I think are staff that we already have could probably do that job, even though they're really taxed right now, but that's what we have these people on board to do and that's $50,000 that our county could have for other uses.

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And then I want to make also a comment about item 18 and the delay of the Loma period of fire department getting their piece of equipment that they raised money to buy and I was not able to contact Mr. Alex Lehman.

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And I'm really trying to take your suggestion to hired Chairman Leopold of contacting people.

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There's just so precious little time before, between the time the budget comes out and

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before I am here before you.

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But I just want to point out that that community raised the money to buy that piece of equipment that they needed.

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And there's money available in Prop 172 funds, $17 million a year.

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That needs to go to capital improvements for our county fire.

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Thank you.

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Thank you.

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Anyone else for the consent agenda?

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If not, I will bring it back to the board for a motion.

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Move approval.

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Second.

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Motion by community, seconded by McPherson.

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All in favor, signify by saying aye.

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Aye.

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Any opposed?

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Motion carries unanimously.

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Next, we will move on to oral communications.

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Can I get a raise, people to raise their hands is who wants to speak during all communications.

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I don't usually do this, we have a very full agenda today, a very long day, or at the board.

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So we're going to try to limit the oral communications to 30 minutes.

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It says that on our agenda, we'll try to get everybody in here.

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So if you could please come forward, I'd appreciate it.

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Good morning.

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Good morning.

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And thank you.

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I want to bring to the attention of the board a project that our neighborhood objects

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to.

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It's on track to being approved.

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The address is 26.11 a state's drive in Aptos.

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Supervisor Friend has been on some communications regarding this project.

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This is being approved, considered as a ministerial application, because it supposedly meets the guidelines of a single family residence.

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However, I assert that it is anything but ministerial because it's unprecedented in the county.

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The most recent iteration of this project is five bedrooms, seven and a half bathrooms, and 2,900 square feet.

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In a neighborhood that has nothing like that, and however, and so that in itself looks

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like a single family residence according to the Planning Department.

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However, the original application was for an 11 bedroom, six and a half bath house,

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with commercial style kitchen, key card entries, emergency exits.

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That was declined because it was clearly not single family residence.

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although that was the claim by the applicants.

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This progression, so taking the current iteration does it meet it, I guess, you know, apparently it does, but when you look at it as a whole,

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and the progression clearly reveals the pattern of its intent not to be a single family residence, but as some sort of commercial endeavor.

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Again, no other doing a search on MLS, no other residents with seven-and-a-half bathrooms

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came up and certainly none under 3,000 square feet.

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So this is truly an unprecedented structure based on the design of it and projected costs

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to construct something like this.

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It's only economically viable uses as a commercial use.

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It's going to, there's safety concerns.

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The neighborhood is a loop with a single ingress egress.

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It has narrow roads, undivided, no sidewalks, no street lights.

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And so increasing any traffic into that area is dangerous.

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I live on a blind curve on their, my kids live across the street from my grandparents that are here.

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And they're running across all the time, increased traffic is going to create a real problem.

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Being that we think that it is actually a commercial entity that something like that could decrease the value of the homes in that neighborhood significantly, depending on what it is that they put there, we suspect we know what it is that's going to go there based on what the applicants say.

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originally and that original plan.

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So I say that I would like this project to be considered as a discretionary permit

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if possible because of its unprecedented nature.

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Thank you.

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Tony, could you give her a name for the record?

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Tony Crane.

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Okay, thank you.

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Good morning, Mr. Arnold.

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Good morning, German supervisors.

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I believe that the California's shepherd's movement is going to have great consequences

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on this county and self-government to encourage people or for people to advocate California's

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separate state is freedom of speech. But when you have elected officials that are taken

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in oath to support the Constitution and conspire against the Constitution to destroy self-government

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really is treason. There have been numerous semi-secret meetings with Governor Brown

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with various people including Eric Holder who's the science advisor for the

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President of the United States. He wrote a book where he advocated Putty's

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sterlance and water and food. The other people joining in this alleged, well

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not alleged, the movement is there, but it's also alleged that the Mexican cartels

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are very interested in a separate state and read China. What has occurred in the

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The color revolutions throughout Europe and the Arab Spring have been at the forefront of these invasions or overthrows or coups has been open borders and immigration.

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I know our county has a program in which the taxpayers pay for people that are not citizens and not on a track, the paper track, to spend taxpayers money to integrate people from any place in the world.

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And right now the United States has 95 million people that are unemployed.

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Now Mexico has more billionaires than almost any other country in the world because they've

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destroyed the middle class and they have cheap labor.

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And I believe that your organization through was at the County Action Board and spending

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money there is actually a counter to the people that live who are your constituents.

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You're undercutting wages, you're stealing jobs, you're adding to the crime, you even release criminals in the community to threaten the seniors, you're not looking out for the Americans, you have a different program, which is one of World Government.

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We find again the same foundations, California forward, funded by huge tax exempt foundations throughout the state.

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And we also have the red Chinese interest on display at the courthouse steps.

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Udel A.C. has two honoring plaques for him.

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Udel A.C. went to Communist China.

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He met there with John Stewart's service and John Aft, who was American's Communist

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spy, who became part of the Chinese intelligence network.

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Also, we've had people here on the board who received red Chinese money thousands of

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dollars.

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I ask you to remove those plaques and get rid of that immigration program, it's counter to the interest of this county.

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Thank you. Good morning.

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Good morning. My name is Lauren Tobin, and I'm the chairperson, or the four person pro-tem of the Santa Cruz County civil grand jury.

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And on behalf of the grand jury, I'd like to thank you all for your proclamation,

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designation, designating February 2017 as civil grand jury awareness month.

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I've worked with this group for the last eight months, a group of intelligent, hardworking

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people who not only strive to shine a light on areas where our local city and county governments

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can do a better job, but also to acknowledge where changes have been made and where jobs

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have been well done.

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As you know, we don't have any judicial or enforcement power, but we wield our influence

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through our reports and we'll be issuing those reports over the next several months

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to bring to light and to demonstrate and help,

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so where county governments can do better

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in terms of ethics, transparency, and efficiency.

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And just lastly, I wanted to mention that as of last spring, the grand jury is now open

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to applications.

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And so if any of you are your staff, know of anyone in your districts who might be suited

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to this type of service to our community, we hope that you will encourage them to apply.

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And we thank you again for your support and recognition.

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Thank you for your service.

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Thank you.

304
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Good morning.

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00:28:20,580 --> 00:28:35,680
Good morning, Chairman Leopold and Board, I'm Stony Brook and I'm here today for your Santa Cruz Veterans Memorial Building and the Board of Trustees as well as the United Veterans Council.

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On the 23rd of this month, as you're aware, we held a Veterans Visiting Summit at the Veterans Building.

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We took a head count, we had about 75 people in attendance, we went into small groups, came

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up with some wonderful ideas, had an opportunity for people to build relationships with one

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another, as well as work on some ideas of how to bring the building back to its former glory,

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to bring in the public, to be able to utilize that facility with art, theater, and music.

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and we felt all in all that was an extremely good event.

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What I wanted to also share with you is we've now installed a computer lab

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and an educational facility in the building for veterans to have access

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to be able to use computers and be able to hopefully transfer to Cabrillo.

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We've also installed a 60-inch TV courtesy of the Aptos Lions Club

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and furniture in the basement as a recreational facility

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and that was donated by Costco, a tremendous thing.

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I also wanted to let you know that our lunch and pantry project

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have continued since the first of the year.

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We're serving now about 60 people each Wednesday

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at the service day.

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It's working fine.

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We're staying within budget.

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Everybody is doing great.

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We've also working with the volunteer initiative program with the county. We're going to be developing a screening process for the people who provide services in the building to make sure that everybody's safe and they're appropriately trained for the jobs we're trying to offer up. We're going to be hosting a job fair in early April. That'll be four days. Three days are going to be services to help develop jobs, application skills, filling out resumes, being able to be interviewed.

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in the fourth day, we have 15 employers who are going to be coming into the building ready

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to hire people on the spot. Now, while it's going to be in the veterans building, the

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focus is on the general community, so everyone will be welcome to come and participate in

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this project. This will be in-sponsored by the Board of Trustees and the United Veterans

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Council. And last but not least, the weekend of Memorial Day, May 27th through 29th, we hope

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to have an open house with historical displays, and we're trying to work with the Museum of Art and History to help bring that building back to the way it used to look.

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It's a gorgeous place and it's been underutilized. That's our commitment to you and the community. Thank you very much.

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Thank you.

334
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Good morning.

335
00:31:21,880 --> 00:31:32,060
Good morning. My name is Becky Steinbruner. I'm a resident of Apptoss, and I want to talk with you this morning about something that I saw in the Santa Cruz Sentinel over the weekend.

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And that was that the lands, the privately owned lands that are supposedly in tax default

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are now going to be auctioned online.

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I happen to know somebody whose farm is on that auction block.

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And I think this is putting making the executioner's faceless to do it online.

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And I will also point out that in this person's case, it isn't taxes.

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It's leans from red tags that were supposed to have been expunged, but were not.

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This person did send in some money, and the check was cashed, but there's no record

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of it in the assessor's records, in the planning department records, where some of these

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leans are coming from, and the leans are being charged 21% interest per month.

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That's robbery.

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How can someone ever do that?

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And so I want to bring to you, and it fits right in well with what Mr. Crane has said here this morning that we really need to bring back the Citizens Building and Fire Appeals Board, where the citizens had, before your board disbanded it, an opportunity to raise appeals without paying $1,800,

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dollars and hiring in a very expensive lawyer to represent them, to fight this kind of thing.

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We have nothing now other than having to spend tremendous amounts of money to uphold our rights and have it some justice.

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So I'm asking you to please bring back the citizens board of building and fire appeals.

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The Santa Cruz, it is a state law that you have it.

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And currently, now when I looked on the website for the appeals, your board is the appeals board.

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And I really think that you could be using your time in a better way.

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And I think that the panel that used to be the appeals board who were building and

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professional people did a very good job and

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And then another appeal board like that could be brought back to the people for appeals at a low cost.

357
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Thank you.

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Good morning.

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I'm Toria Nelson-Weeks from La Selva Beach, and of course I recognize Mr. Friend.

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What I would like to propose here is that as a community county and so for us that we consider

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acknowledging all of the people and organizations that responded regarding the last storms and

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I understand I guess public works is going to have some kind of acknowledgement but I'm

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talking about the people who came for PG&E from Fresno, a lot of these people who responded

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here in all organizations, Davie Tree, the firefighters, the Cal Trans police, CHP,

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and I'm sure in many communities there were probably just individuals that saw something

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and that needed to be done, maybe got their tractor and pulled one of these large trucks out

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of the mind. So I'm thinking that as churches, other organizations and so forth, that maybe

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on the 4th of July, when we do have our barbecues and parades and so forth, that something

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should be done to acknowledge these people. I also think personal letters would be a wonderful

370
00:35:38,600 --> 00:35:44,340
I think it's very important and you'll have to forgive me as I'm very emotional

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regarding just being here today and listening to the other people.

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Thank you for your service.

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Thank us all.

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Thank everyone of us.

375
00:36:00,210 --> 00:36:01,050
Thank you so much.

376
00:36:01,550 --> 00:36:02,030
Thank you all.

377
00:36:06,770 --> 00:36:07,470
Good morning.

378
00:36:08,070 --> 00:36:08,810
Good morning.

379
00:36:09,370 --> 00:36:10,770
Thank you for your time today.

380
00:36:10,770 --> 00:36:16,050
My name is Mueller Geeson, and I'm one of the residents on the Estates driving out

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00:36:16,050 --> 00:36:19,470
toss, and I'm speaking on behalf of the neighborhood there.

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I just like to say that thousands of people have made their decisions prior to the owners,

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the current owners of 2611, and made their decisions in the past based on the neighborhood

384
00:36:30,630 --> 00:36:35,850
and the financial decisions that we all did when we moved into that neighborhood.

385
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So, you know, we carried those properties through good times and in bad, a lot of the neighbors

386
00:36:44,150 --> 00:36:47,830
had been in there for a long periods of time and carried them through a lot of financial

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00:36:49,630 --> 00:36:52,570
periods of time where that was very difficult myself included.

388
00:36:54,430 --> 00:36:59,810
You know, in particular for myself, I do have children that play in the street on blind

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And you know, the neighborhood does it like Tony said, only have one in grass and one e-grass.

390
00:37:06,910 --> 00:37:14,050
But as Tony had stated, this is definitely not consistent with the neighborhood that we have.

391
00:37:14,230 --> 00:37:22,790
This is definitely a commute, you know, in my opinion, a commercial development and based on the comments of the people that we've spoken to on the project.

392
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It stated in the general plan and it's a mandate that for future growth and the development

393
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is in a manner consistent with the goals and quality of life desired by the Santa Cruz County

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00:37:34,370 --> 00:37:34,850
citizens.

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00:37:35,390 --> 00:37:40,490
In this case, the family will benefit financially at the expense of the other 58 owners in

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the neighborhood.

397
00:37:41,370 --> 00:37:46,590
This is clearly not what was intended with the framers of the general plan because of this

398
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Unprecedented nature of this project and the potential financial repercussions,

399
00:37:52,630 --> 00:37:58,630
we respectfully request that you reconsider this application as discretionary permit.

400
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Thank you.

401
00:38:00,770 --> 00:38:01,070
Thank you.

402
00:38:09,160 --> 00:38:16,680
Good morning, since these LED lights were put in, feels worse than ever, and I want to

403
00:38:16,680 --> 00:38:26,520
You draw people's attention to an interview, Dr. Mercola Dia on the dangers of LED lighting

404
00:38:26,520 --> 00:38:29,580
with a photobiologist.

405
00:38:31,440 --> 00:38:43,320
In addition, we are exposed to a lot of microwave radiation from all these antennas,

406
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life, I et cetera, this young man was talking about the quality of life being very important.

407
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This is damaging our quality of life to be exposed to all these toxins.

408
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Here's a quote, forget who from my speech you've see out from the indigenous people.

409
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All things are connected like the blood which unites one family.

410
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Whatever befalls the earth, befalls the people of the earth.

411
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We did not weave the web of life.

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We are merely a strand in it.

413
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Whatever we do to the web, we do to ourselves.

414
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We need to respect and protect the web of life.

415
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And that's what I'd like to see this for the supervisors too.

416
00:39:40,040 --> 00:39:49,800
Unfortunately, not seeing that, when former supervisor Jan Buse received correspondence

417
00:39:49,800 --> 00:39:56,760
from Olga Stone about 10 years ago about the proliferation of radiation emitting cell

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00:39:56,760 --> 00:40:07,500
towers in her neighborhood and all over now, she told of her brain cancer that she finally

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00:40:07,500 --> 00:40:18,000
died of and the cancer that dogs got, and indeed what happened to Olga's stone is consistent

420
00:40:18,000 --> 00:40:25,060
with surveys around these radiation emitting cell towers that are now being put on utility

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00:40:25,060 --> 00:40:32,740
poles for 5G, 4G technology is in my neighborhood, totally degraded the quality of life.

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Surveys around these towers show people experiencing fatigue headaches, memory loss, cardiovascular

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problems, as well as increased cancer.

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And she concluded her letter to Supervisor Jan Budes, do we want the health effects of

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cell towers to proliferate in our community?

426
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It feels like an invasion.

427
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Indeed, it is an invasion who are being assaulted by these frequencies.

428
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You can't remove them.

429
00:41:12,180 --> 00:41:17,660
The Board of Supervisors should be protecting our health, not corporate wealth.

430
00:41:18,000 --> 00:41:18,320
Thank you.

431
00:41:22,040 --> 00:41:25,040
Give a few more minutes for oral communications.

432
00:41:26,420 --> 00:41:30,500
Seeing no one, I'll bring it to the back to our regular agenda.

433
00:41:31,480 --> 00:41:44,660
Item number 48, which is considered recognition of Department of Public Works Transportation Division for their work on the county roads during the winter 2016-17 season as outline in the memorandum of Supervisor Coonerty.

434
00:41:46,140 --> 00:41:54,920
So as was noted, we've had a lot of different county workers and private sector workers and regular citizens out there working hard in these storms.

435
00:41:55,200 --> 00:42:00,460
It was a natural disaster, several natural disasters over the course of the last month.

436
00:42:01,120 --> 00:42:03,740
And I just want to take a moment to thank our public works,

437
00:42:04,940 --> 00:42:08,760
Rhodes Cruz, who have been out there working overtime trying to fix it up.

438
00:42:09,140 --> 00:42:12,280
Normally, we'd have them come in and we'd have a celebration.

439
00:42:13,100 --> 00:42:20,900
Well, some of them are here, but I know that many of them are out there working today as they have been every day for the past couple of weeks.

440
00:42:21,360 --> 00:42:30,040
So we had cookies delivered to the road crews around the county today, and I just know me and my colleagues just want to say thank you.

441
00:42:37,840 --> 00:42:38,620
Thank you, Chair.

442
00:42:38,620 --> 00:42:45,660
And it's been amazing how 24 hours a day the public works crew has been.

443
00:42:46,140 --> 00:42:51,100
We've been hearing from public works in the middle of the night when we've had issues that we've had to get out.

444
00:42:51,220 --> 00:42:53,420
Before Valencia, elementary had to be closed.

445
00:42:53,600 --> 00:42:57,260
I was receiving text messages from Ray in the middle of the evening.

446
00:42:57,980 --> 00:43:01,200
Making sure that the school was communicated with, making sure I was communicated with.

447
00:43:01,360 --> 00:43:07,880
We held a large community meeting last night and assistant director Steve Wiesner was there until almost a little after 9 o'clock.

448
00:43:07,880 --> 00:43:09,460
making sure everybody's questions are answered.

449
00:43:10,860 --> 00:43:13,320
This is going on every single day and it's been going on since December.

450
00:43:14,140 --> 00:43:16,640
And we've hit multiple storm sets.

451
00:43:17,620 --> 00:43:20,360
And during these times of sun doesn't mean the public works isn't doing anything.

452
00:43:20,360 --> 00:43:25,840
In fact, they are doing a lot to address the nearly 140 permanently damaged

453
00:43:26,460 --> 00:43:30,720
unincorporated roads in our county that have reached about $40 million in damage

454
00:43:30,720 --> 00:43:36,320
to put in perspectives about, you know, it's a significant undertaking, significant effort.

455
00:43:36,320 --> 00:43:42,500
And over the last couple of years this board has heard public works talk about all because

456
00:43:42,500 --> 00:43:46,320
the gas tax and other elements about how the roads crews actually have been cut funding

457
00:43:46,320 --> 00:43:47,800
and staffing over time.

458
00:43:48,560 --> 00:43:53,200
And I haven't heard a single complaint from any member of public works over the last two

459
00:43:53,710 --> 00:43:54,520
and a half, three months.

460
00:43:55,020 --> 00:43:59,360
In fact, all I hear is that a lot of them tell me they're excited to be able to get people

461
00:43:59,360 --> 00:44:00,380
to get back to their homes.

462
00:44:00,380 --> 00:44:05,100
And this is why they signed up for this job and that kind of, it was really admirable.

463
00:44:05,100 --> 00:44:06,160
It's just really admirable.

464
00:44:06,840 --> 00:44:10,880
It's a group of people, I've talked to Director Presley about this group of people that don't

465
00:44:10,880 --> 00:44:11,320
like praise.

466
00:44:12,140 --> 00:44:16,740
I just want to go out and do work and do good work, but we're hearing it all the time from

467
00:44:16,740 --> 00:44:22,000
our constituents about how much they appreciate the fact that within really, within no time

468
00:44:22,000 --> 00:44:25,520
for when something happens, they're out there assessing the engineers are there, they're removing

469
00:44:25,520 --> 00:44:29,320
the damage, they're making sure at least one lane is passable and some people get in and

470
00:44:29,320 --> 00:44:29,940
out of their homes.

471
00:44:30,600 --> 00:44:34,820
We really do appreciate what all of you have done and all the time commit that you're putting

472
00:44:34,820 --> 00:44:45,280
and recognizing we're still in some respects in the beginning stages of all that we have to do here in the county and the rebuild process, but we're confident in putting it in your hands and all the stuff that you guys would do. Thank you.

473
00:44:51,800 --> 00:44:59,920
There's the thanks can't be overstated. The public works department in particular that rebuild or try to rebuild what we can as quick.

474
00:45:00,000 --> 00:45:29,880
Please, we can. We haven't seen anything like this. I mean, people said this is worse, it's been worse on our infrastructure than the earthquake, or the storm of A2, or the flood of 55. It just, and it goes on and on and on. This is the worst that we've experienced yet. I think we might be hearing a little more about that. But I am not only public works, but the public safety personnel throughout the fire departments, CHP, the police department,

475
00:45:29,880 --> 00:45:36,800
Mrs. Sheriff's Office, everyone has just stepped up an extra notch and put in extra hours, believe me.

476
00:45:37,360 --> 00:45:46,620
And PG&E has done a phenomenal job, too, of trying to catch up with what in other AT&T and so forth as quickly as we can.

477
00:45:46,720 --> 00:45:56,460
It gets complicated when you have to deal with wires before the trees are filled and it just is a complicated situation that needs a lot of coordination.

478
00:45:56,460 --> 00:46:03,140
And that's not always easy to come by when I understand public works gets, it's been

479
00:46:03,140 --> 00:46:07,560
getting at least 75, at 85 calls an hour at some times.

480
00:46:08,320 --> 00:46:14,620
And so other agencies are getting like phone calls and to try to coordinate that all at

481
00:46:14,620 --> 00:46:16,940
the same time is not easy.

482
00:46:17,360 --> 00:46:23,140
I think we will look back and we'll see how we can approve on coordinating those activities.

483
00:46:23,140 --> 00:46:42,780
But for what we have and the effort, the damage has been placed upon us in Santa Cruz County and I understand it's probably about 10% of the total storm damage in the state is what's going on here when we're closing in on the $40 million damage estimates that we have now.

484
00:46:42,780 --> 00:46:49,920
So I just want to thank you, I think, that there's three levels that we want to get to

485
00:46:49,920 --> 00:46:56,580
first, general public safety, get people who are isolated because of road closures, get

486
00:46:56,580 --> 00:47:03,100
them to get back to the community and to get our major roadways going.

487
00:47:03,260 --> 00:47:07,640
I understand that Highway 152, that's a state highway, of course, but that was just open

488
00:47:07,640 --> 00:47:14,360
this morning, again, but it's unbelievable when you go out there and you see it when

489
00:47:14,360 --> 00:47:20,720
you see Bear Creek Road right after the bridge in Boulder Creek and you look down about,

490
00:47:20,760 --> 00:47:25,000
I don't know, at least 40 or 50 feet and it's just a cliff now and there's one lane.

491
00:47:26,700 --> 00:47:33,560
I have been to several community forums one time or another last night as I think I mentioned

492
00:47:33,560 --> 00:47:39,740
Before Lakeside School, last night in Santa Clara County, with Public Works Director John Presley,

493
00:47:40,260 --> 00:47:46,280
we coordinated a meeting with Santa Clara Supervisor Mike Wasserman to let the people,

494
00:47:47,140 --> 00:47:50,820
let them know where we are, how, this is going to take a long time to come back.

495
00:47:51,580 --> 00:47:57,800
And we have to let things dry out, the engineering process and so forth is going to be a long haul.

496
00:47:58,140 --> 00:48:02,660
But I really want to thank the general public too for their resiliency,

497
00:48:02,660 --> 00:48:18,040
They're patients. Some people have lost their patients a little, but the best story, the whole storm system has been when a couple of our neighbors just pulled out the chain saw some highway 17 and cleared the road in no time at all.

498
00:48:19,000 --> 00:48:27,600
That's not because Calcran couldn't do it. It's just they were there and they did it and they acted and everybody's helping everybody else as much as they can.

499
00:48:27,600 --> 00:48:36,640
And I want to thank the departments that I've mentioned, but for the general public to just maintain your cool, be patient.

500
00:48:36,960 --> 00:48:38,640
This is going to take a long time to recover.

501
00:48:39,040 --> 00:48:44,440
We're still waiting to see just how much the federal and state governments may be able to assist us.

502
00:48:44,560 --> 00:48:49,980
They will be an assistance to us, but it's going to take some time.

503
00:48:50,440 --> 00:48:53,080
And thank you for your patience and just keep them.

504
00:48:53,680 --> 00:48:53,940
Thank you.

505
00:49:00,460 --> 00:49:11,700
I want to thank Public Works also, District 4, we had our problems and we had one major

506
00:49:12,440 --> 00:49:18,420
project that they called the right people and got everybody there, granite rock, that

507
00:49:18,420 --> 00:49:25,640
was the big break and leakage going on by coward road off of Riverside Drive, Riverside

508
00:49:25,640 --> 00:49:31,700
road and also between Thompson. That could have been, you know, major flooding, mostly

509
00:49:31,700 --> 00:49:39,460
in the agricultural land. But if that broke in that area, it would have, you know, could

510
00:49:39,460 --> 00:49:48,740
have been a problem also in senior village area. I want to thank public works for proactive

511
00:49:48,740 --> 00:49:58,020
work with the bench excavation project of the Pauho River. We could have our experts come

512
00:49:58,020 --> 00:50:03,520
up, but I believe if we didn't do that work, we would have had some major damage in

513
00:50:03,520 --> 00:50:11,440
District 4. What I'm talking about is three years ago, removing 300,000 cubic yards of sediment

514
00:50:11,440 --> 00:50:15,060
that had built up on the banks of the Pajaro River.

515
00:50:16,120 --> 00:50:20,640
That was removed, that was 30,000 truckloads that was removed.

516
00:50:21,020 --> 00:50:27,920
They had to go through a huge amount of paperwork with the Army Corps of Engineers,

517
00:50:28,280 --> 00:50:33,920
the State of California, Fish and Game, Federal Wildlife Refuge.

518
00:50:33,920 --> 00:50:44,300
And we did have problems, but with all of that removed and the widening of the banks,

519
00:50:45,060 --> 00:50:47,940
I believe I have the figures right.

520
00:50:48,320 --> 00:50:53,880
It increased the flow of the Pauho River and also took pressure off the Corleedis Creek

521
00:50:53,880 --> 00:51:00,660
and the South-Supredis Creek and increased flow by about 3,000 to 4,000 gallons per second

522
00:51:00,660 --> 00:51:05,500
And in a storm that was water actually being able to get out of there.

523
00:51:07,640 --> 00:51:14,080
The water levels raised up to almost flood level in a certain area of the district for.

524
00:51:14,860 --> 00:51:17,640
And within a couple of feet of going over the banks.

525
00:51:18,240 --> 00:51:23,680
So with all that sediment being removed, I just want to thank you for all the work you did.

526
00:51:23,680 --> 00:51:26,460
and also Carlos Palacios and Susan Morello

527
00:51:27,280 --> 00:51:31,280
for focusing on South County about three years ago

528
00:51:31,560 --> 00:51:33,540
and making sure we were proactive.

529
00:51:34,260 --> 00:51:36,260
One other little story too.

530
00:51:37,360 --> 00:51:38,740
The Lake and community,

531
00:51:40,200 --> 00:51:44,380
one home was, did have water enter into the house.

532
00:51:44,960 --> 00:51:48,040
It's a care facility for people

533
00:51:48,040 --> 00:51:49,700
and they did have to be removed.

534
00:51:50,900 --> 00:51:53,100
That was a buildup of college lake

535
00:51:53,100 --> 00:51:58,140
and there's a stream back there, I call it a ditch really, but it's overflow from

536
00:51:58,140 --> 00:52:02,720
Pinto Lake and it runs into that area. So you have Cornelitis Creek, South

537
00:52:02,720 --> 00:52:09,100
Subway's Creek, the Pinto stream, all running into one culvert behind the

538
00:52:09,100 --> 00:52:16,660
lake and community. That culvert branch broke off in the middle of one of the

539
00:52:16,660 --> 00:52:23,260
storms and was right out the culvert, and we called public works.

540
00:52:24,000 --> 00:52:25,140
They came out right away.

541
00:52:25,380 --> 00:52:27,920
It was a very dangerous kind of a situation.

542
00:52:29,420 --> 00:52:34,500
They had to actually walk out on the culvert, which is about six foot wide, six foot in

543
00:52:36,020 --> 00:52:42,780
diameter, and reach out with a pole cutter and actually cut those branches up into small

544
00:52:42,780 --> 00:52:47,620
pieces so that it could actually flow through the culvert rather than jam it.

545
00:52:48,720 --> 00:52:55,680
College Lake, if that, if some of this work was not done, that area, the lake and community

546
00:52:55,680 --> 00:52:58,800
of about a hundred homes would have had major flooding.

547
00:52:59,460 --> 00:53:07,520
So anyway, I could talk on and on about heroic action that took place by fire department and

548
00:53:07,520 --> 00:53:14,100
the sheriff's police, city crews and everything coming to come together.

549
00:53:14,420 --> 00:53:18,080
So thank you very much and God bless you for all you're doing.

550
00:53:19,820 --> 00:53:20,780
Thank you.

551
00:53:25,170 --> 00:53:31,250
You know, when I think about our public works transportation division, the men

552
00:53:31,250 --> 00:53:37,610
and women who really help keep our road network strong and have placed

553
00:53:37,610 --> 00:53:45,070
such a critical role over the last six weeks in trying to keep our roads open. I think

554
00:53:45,070 --> 00:53:54,230
of the expression that never has so much been done by so few for so many. The road crew

555
00:53:54,230 --> 00:54:05,710
is probably half the size it was ten years ago. And last year when we went out to ask

556
00:54:05,710 --> 00:54:09,890
the public to support measure D. One of the things we wanted to see as part of that

557
00:54:09,890 --> 00:54:13,670
is to actually increase the size of our road crew to do the ongoing work and maintenance

558
00:54:14,110 --> 00:54:23,470
that are necessary. What we've seen in these storms is a really fierce commitment to making

559
00:54:23,470 --> 00:54:27,570
sure that people can get to their homes, they can get to their businesses, they can get to

560
00:54:27,570 --> 00:54:35,690
their schools. And that commitment has been from bottom up, from top down. There has

561
00:54:35,690 --> 00:54:40,250
hasn't been in the conversation with the Director John Presley or Assistant Director Steve

562
00:54:40,250 --> 00:54:47,870
Weasner in the last weeks where this wasn't their primary focus, whether helping ensure

563
00:54:47,870 --> 00:54:53,830
that the resources were there to support the road crew and all the contractors who were

564
00:54:53,830 --> 00:54:59,410
doing the work or going out and helping us identify funding or creative strategies.

565
00:55:00,130 --> 00:55:04,530
And to the road crew, it's been an extraordinary work.

566
00:55:05,070 --> 00:55:12,270
My office has worked with Don, Harmon, and Augie Waltrip for work up in the summit.

567
00:55:13,690 --> 00:55:18,610
You know, there are some roads that we have that you wonder how we ever let them go in,

568
00:55:19,210 --> 00:55:23,230
because they're in such precarious positions even in the best of times.

569
00:55:23,230 --> 00:55:30,750
And as we've seen our road system deteriorate in some ways because of this extraordinary amount

570
00:55:30,750 --> 00:55:40,670
of water that's been coming down, the efforts to clear slides, remove trees, find work

571
00:55:40,670 --> 00:55:44,210
around that the help people get to where they're going have been really extraordinary.

572
00:55:44,770 --> 00:55:49,550
I want to express my appreciation and the appreciation and the board and all the residents of the

573
00:55:49,550 --> 00:55:53,950
first district for the work that you guys do in the last couple of weeks, but you do all the time.

574
00:55:54,410 --> 00:55:58,230
And we'll work to make sure you have more folks to help you do that work in the future.

575
00:55:58,570 --> 00:56:01,230
So thank you for your work, and we really appreciate it.

576
00:56:01,810 --> 00:56:06,050
We do have a proclamation, maybe Supervisor Coonerty wants to present this proclamation.

577
00:56:17,570 --> 00:56:22,050
So here's a proclamation signed by every member of the Board of Supervisors thanking you.

578
00:56:22,650 --> 00:56:29,230
I don't know if this or the cookies are more valuable, but as you heard,

579
00:56:29,230 --> 00:56:34,210
We're so appreciative of your efforts, so we know it hasn't been easy, and we know there's a road to go,

580
00:56:34,370 --> 00:56:35,910
but thank you, thank you for your efforts.

581
00:56:42,080 --> 00:56:48,300
I want to say something, but I'd like to say that it's, we are a family.

582
00:56:48,760 --> 00:56:50,240
You get closer to the mic so we can hear you.

583
00:56:50,240 --> 00:56:55,580
We are a family, and there are very few of us, but, as you said, we are all dedicated

584
00:56:56,280 --> 00:57:00,600
to getting people home, getting roads open, and keeping everybody safe.

585
00:57:01,300 --> 00:57:06,900
This is for the people that are out there 12, 16 hours a day who don't complain,

586
00:57:07,560 --> 00:57:12,280
who are happy with pizza at the end of the day, go home and take a bath and come back

587
00:57:12,280 --> 00:57:14,880
the next day, so thank you very much.

588
00:57:22,850 --> 00:57:24,870
All right, but just keep it to roads, not waterways.

589
00:57:25,250 --> 00:57:26,190
I know, I'll make it a real good.

590
00:57:26,770 --> 00:57:29,490
A word of precaution, we're still in the winter.

591
00:57:30,330 --> 00:57:37,870
The crew has to be vigilant, and I think it was in the 1990s we had a big storm in March.

592
00:57:38,490 --> 00:57:54,250
And that was a very close to major flooding damage, so we're doing well, we're doing best we can, but we do have to keep vigilant until we get into the middle of the spring problem.

593
00:57:54,630 --> 00:57:55,250
Thank you.

594
00:57:55,970 --> 00:57:56,350
Thank you.

595
00:57:59,610 --> 00:58:02,470
And I'm not sure if the director wanted to say anything.

596
00:58:04,030 --> 00:58:06,590
I know you're going to be speaking during the budget study session.

597
00:58:11,890 --> 00:58:13,490
John Pressley, director of public works.

598
00:58:13,790 --> 00:58:17,650
I can honestly say I would call out in the middle of the night and there will be these folks

599
00:58:17,650 --> 00:58:20,350
who are out there working, so they're very remarkable.

600
00:58:22,470 --> 00:58:25,970
We are hoping to see some transportation funding come down from the state.

601
00:58:26,150 --> 00:58:30,270
We can rebuild the road crew over time and replace equipment.

602
00:58:30,270 --> 00:58:33,630
and I'll talk more about that later today at 1.30,

603
00:58:33,750 --> 00:58:36,810
but they are a remarkable group of people,

604
00:58:37,090 --> 00:58:40,310
and we should be very appreciative of the work they do.

605
00:58:40,550 --> 00:58:42,130
And thank you for honoring them today.

606
00:58:42,490 --> 00:58:45,810
It's really well, this is a great thing for them.

607
00:58:46,290 --> 00:58:48,090
Yeah, thank you for your leadership.

608
00:58:48,370 --> 00:58:48,650
Thank you.

609
00:58:52,400 --> 00:58:55,080
Now we're going to move on to item number 49,

610
00:58:55,640 --> 00:58:57,820
which is consider resolution approving

611
00:58:57,820 --> 00:58:59,460
the joint powers authority agreement,

612
00:58:59,820 --> 00:59:02,400
establishing the Monterey Bay Community Power Authority,

613
00:59:02,400 --> 00:59:08,040
A firm that the Monterey Bay Community Power Authority is exempt from the requirements of the California Environment

614
00:59:08,040 --> 00:59:29,780
Equality Act, approve the County of Santa Cruz as a founding member of the authority, approve ordinance and concept authorizing the implementation of a community choice aggregation program, and take related actions as outlined in the memorandum of the general services director, included as a resolution, the MPCP joint powers agreement and the ordinance.

615
00:59:30,460 --> 00:59:32,160
Good morning, Mr. Palacios.

616
00:59:32,940 --> 00:59:36,220
Good morning, Carlos Palacios, Assistant County Administrative Officer.

617
00:59:36,740 --> 00:59:38,800
We are very excited to be here today.

618
00:59:40,060 --> 00:59:45,180
Today is the culmination of over three years of effort to form this joint powers authority.

619
00:59:46,240 --> 00:59:50,820
We have held more than 26 public meetings throughout the tri-county region and

620
00:59:50,820 --> 00:59:53,560
heard over 100 hours of public testimony.

621
00:59:54,640 --> 00:59:59,820
I'm trying to bring 21 jurisdictions in three counties to agreement on a very complex

622
01:00:00,000 --> 01:00:10,720
This project involving technical, policy, and governance issues is no easy task, and yet we have almost done it. We're right at the finish line.

623
01:00:11,680 --> 01:00:26,700
Monterrey Bay Community Power has officially been born. The JPA actually exists with the approval of second readings in San Benito County, Hollister, Scott's Valley, and Capitola. A number of other jurisdictions have already approved the first reading of the ordinance.

624
01:00:27,400 --> 01:00:34,800
Throughout this process, our leader and champion has been supervisor Bruce McPherson and is aid Jenny Johnson.

625
01:00:35,200 --> 01:00:42,380
They have spent countless hours traveling to every jurisdiction in our tri-county region to listen and inform and advocate.

626
01:00:43,400 --> 01:00:44,760
Thank you for your leadership.

627
01:00:45,720 --> 01:00:52,220
The CAO's office, General Services, County Council and our consulting team have provided this staff report to this effort.

628
01:00:52,220 --> 01:00:56,780
And we should be very proud that Santa Cruz County is where this effort began.

629
01:00:57,360 --> 01:01:01,840
And Santa Cruz County has been the lead in bringing this initiative to culmination.

630
01:01:03,440 --> 01:01:11,880
I'd like to now introduce Carol Johnson, our administrative services manager in the general services department to give today's presentation.

631
01:01:17,240 --> 01:01:20,600
Excuse me, good morning, Chair Leopold, members of the board.

632
01:01:21,220 --> 01:01:26,200
We are here this morning to present some next steps in the formation of Monterey Bay Community Power.

633
01:01:26,200 --> 01:01:49,180
That includes the adoption of the resolution approving the joint powers authority agreement establishing Monterey Bay Community Power, the execution of the agreement and to affirm that Monterey Bay Community Power is exempt from the requirements of the California Environmental Quality Act, to approve and concept the ordinance authorizing the implementation of a community choice aggregation program.

634
01:01:49,940 --> 01:01:55,840
Direct staff to move forward and participate in discussions regarding the county's share of the Credit Guarantee,

635
01:01:56,720 --> 01:02:02,880
appoint two representatives of your governing body to serve as primary and alternate to the newly formed

636
01:02:02,880 --> 01:02:08,180
Monterey Bay Community Power Policy Board of Directors, direct the clerk of the board to place

637
01:02:08,180 --> 01:02:14,560
the second reading of the ordinance on the next available agenda for final adoption, consider providing

638
01:02:14,560 --> 01:02:19,800
in direction to the representatives of this governing board regarding policies proposed by local

639
01:02:19,800 --> 01:02:26,220
labor representatives, and request authority to attach the final executed exhibit B of

640
01:02:26,220 --> 01:02:29,900
the JPA agreement once all parties have adopted the ordinance.

641
01:02:30,660 --> 01:02:35,920
But first, I'd like to present the following slide which provides history, background, best

642
01:02:35,920 --> 01:02:41,120
practices, and recommendations of the Project Development Advisory Committee that have gone

643
01:02:41,120 --> 01:02:44,520
into the documents we are requesting your board's approval on today.

644
01:02:45,140 --> 01:02:48,100
At the end of the presentation, we are available for questions.

645
01:02:49,000 --> 01:02:51,880
We also have Sean Marshall here from Lean,

646
01:02:52,820 --> 01:02:55,180
Ginny Johnson, as well as David Carlson.

647
01:02:58,700 --> 01:03:03,780
This slide identifies all the partners that have gone into developing the Monterey Bay

648
01:03:04,440 --> 01:03:05,380
community power.

649
01:03:05,640 --> 01:03:11,340
They include the counties of Santa Cruz, San Benito, and Monterey in all 18 cities

650
01:03:11,340 --> 01:03:12,720
within the tri-county area.

651
01:03:12,720 --> 01:03:29,280
We also worked with three regional joint power authorities, including Monterrey United Air Resources District, the Salinas Valley Solid Waste Authority, Monterrey Regional Waste Management District, and one of our key partners with the Community Foundation of Santa Cruz County.

652
01:03:32,450 --> 01:03:42,830
Monterrey Bay Community Power Goals include, to reduce greenhouse gas emissions, provide electric power and other forms of energy to customers at competitive prices.

653
01:03:42,830 --> 01:03:48,550
in Monterey, Santa Cruz, and San Bonito to reduce energy consumption and stimulate the

654
01:03:48,550 --> 01:03:51,370
local economy by creating local jobs.

655
01:03:53,260 --> 01:04:00,670
The formation process include numerous meetings including three special study sessions for

656
01:04:00,670 --> 01:04:06,410
elected as well as executive staff between May and June.

657
01:04:06,410 --> 01:04:15,230
We also provided numerous board presentations and in December and January we held ad hoc meetings

658
01:04:15,580 --> 01:04:21,870
to discuss in-depth details about finance information options as well as governance.

659
01:04:23,060 --> 01:04:28,430
Some of the deadlines that we were able to meet included passing the Monterey Bay Community

660
01:04:28,430 --> 01:04:34,750
power resolution of intent by September of 2016. That was passed by 18 governing boards.

661
01:04:36,550 --> 01:04:40,950
As Carlos mentioned, we've asked councils and boards to take action to form the JPA

662
01:04:40,950 --> 01:04:48,190
by today. So four have actually done so and have the second reading. We have additional

663
01:04:48,190 --> 01:04:55,430
meetings at the City of Santa Cruz today, City of Delray Oaks, City of King, as well as

664
01:04:55,430 --> 01:04:58,930
the City of Watsonville are all having meetings today on this very topic.

665
01:04:59,750 --> 01:05:05,290
And our goal is to have phase two formation and begin launch in spring of 2018.

666
01:05:14,640 --> 01:05:19,420
Some of the key guiding principles that were developed by the PDAC included offering competitive

667
01:05:19,420 --> 01:05:24,580
rates at the same or less as what is PG&A is currently charging.

668
01:05:25,180 --> 01:05:31,140
And those electrical services will include no unbundled racks, coal or nuclear resources.

669
01:05:31,140 --> 01:05:38,140
They recommended supporting rapid investment in local renewable energy at generation, control

670
01:05:38,140 --> 01:05:43,860
and safeguard of customer revenues and pursuit of long-term power procurement, maintaining

671
01:05:43,860 --> 01:05:49,440
a firewall between assets and liabilities of the CCE agency and those of municipal general

672
01:05:49,440 --> 01:05:49,940
funds.

673
01:05:50,960 --> 01:05:56,400
They recommended implementing effective risk management practices to ensure transparency

674
01:05:56,400 --> 01:05:58,940
and accountability to the local community.

675
01:05:58,940 --> 01:06:04,840
We also want to offer complementary programs that serve the community in the interest, such

676
01:06:04,840 --> 01:06:10,840
as feeding tariff, net metering, energy efficiency, retrofits, demand response, community

677
01:06:10,840 --> 01:06:14,820
solar, electric vehicle battery targeting as well as battery storage.

678
01:06:16,450 --> 01:06:21,300
We hope to establish criteria for the use of surplus revenues that ensures geographic equity

679
01:06:21,300 --> 01:06:24,020
and adheres to economic justice principles.

680
01:06:24,020 --> 01:06:31,260
And another principle is to develop a long-term strategic goal of regional energy self-sufficiency

681
01:06:31,260 --> 01:06:37,740
by building out local, renewable general projects using local workers making prevailing

682
01:06:37,740 --> 01:06:38,120
wages.

683
01:06:41,490 --> 01:06:47,610
Additional best practices that came from the three years of the PDAX work included recommending

684
01:06:47,610 --> 01:06:55,450
a standalone joint powers agency for economics of scale and procurement, financing, and long-term

685
01:06:55,450 --> 01:07:01,550
operations, keeping local control of operational decisions and revenue streams, taking advantage

686
01:07:01,550 --> 01:07:05,950
of existing CCE expert consultants and back-end administrative services.

687
01:07:06,550 --> 01:07:09,850
There are numerous CECEs that have been formed.

688
01:07:10,030 --> 01:07:14,630
We've worked with Representative Des from Snowma Clean Power, Marin Clean Energy.

689
01:07:14,910 --> 01:07:20,890
They have provided in-depth expert advice that we have been able to take advantage of.

690
01:07:20,890 --> 01:07:28,770
We're recommending regional, equitable representation relative to population and electric, electric

691
01:07:28,770 --> 01:07:29,690
CD usage.

692
01:07:30,250 --> 01:07:33,970
And as you'll see from the forthcoming slide, we're recommending a manageable number

693
01:07:33,970 --> 01:07:37,150
of board members comprised of elected with alternates.

694
01:07:37,610 --> 01:07:42,550
We're also recommending a technical advisory committee of industry experts without conflict

695
01:07:42,550 --> 01:07:47,910
of interest and board representation that's structured similar to the Monterey Bay air

696
01:07:47,910 --> 01:07:48,750
resources district.

697
01:07:48,750 --> 01:07:49,930
So

698
01:07:52,520 --> 01:07:57,360
this slide shows the policy and operations board composition.

699
01:07:57,820 --> 01:08:05,780
Until such time as the JPA reaches more than 11 member agencies, the seats will be allocated on a one jurisdiction, one seat basis.

700
01:08:06,400 --> 01:08:16,820
Once the JPA reaches more than 11 members, the policy and operations board composition will shift to a regional allocation based on population size.

701
01:08:17,820 --> 01:08:23,400
There are five jurisdictions with populations of 50,000 and above that will have a permanent seat.

702
01:08:24,020 --> 01:08:29,040
Pending passage of the JPA resolution of ordinance, these would be Santa Cruz County,

703
01:08:29,640 --> 01:08:34,020
Monterey County, and the cities of Salinas, Santa Cruz, and Watsonville.

704
01:08:34,540 --> 01:08:41,280
We're also recommending that the County of San Bonito would have a permanent seat in recognition of its large geographical area.

705
01:08:41,900 --> 01:08:48,900
The remaining five shared rotating seats would be one for the Santa Cruz small cities, one shared seat for

706
01:08:48,900 --> 01:08:53,700
peninsula cities, one for coastal cities, one for Salinas Valley cities, and one for the

707
01:08:53,700 --> 01:08:59,300
San Bonito County small cities. The board also includes technical and advisory committees.

708
01:09:00,520 --> 01:09:04,980
We're recommending that the board structure will include a policy and operations board.

709
01:09:05,340 --> 01:09:10,340
The policy board will be composed of elected, who will have authority in the areas of strategic

710
01:09:10,340 --> 01:09:15,680
planning, adoption of the implementation plan, passage of the budget, customer rates,

711
01:09:15,780 --> 01:09:21,640
large capital projects, and financing as well as hiring of the CEO, Council, Treasurer,

712
01:09:21,880 --> 01:09:22,320
and Auditor.

713
01:09:22,980 --> 01:09:28,040
The operations board will be composed of senior executive staff who will focus on the routine

714
01:09:28,040 --> 01:09:29,200
day-to-day operations.

715
01:09:31,100 --> 01:09:36,920
As Carlos mentioned, four jurisdictions have approved the APA, adopted the resolution,

716
01:09:36,920 --> 01:09:42,200
and have the first and second readings of the ordinance based on this government structure

717
01:09:42,200 --> 01:09:43,460
that we have presented here.

718
01:09:45,780 --> 01:09:53,160
The next slide shows the policy and operations board composition that Monterey County is

719
01:09:53,160 --> 01:09:53,780
recommending.

720
01:09:54,460 --> 01:10:01,180
This design is the same as what you saw previously except Monterey County is recommending that

721
01:10:01,180 --> 01:10:07,640
there would be one additional extra vote, not a seat, but a vote for jurisdictions above

722
01:10:07,640 --> 01:10:15,640
100,000 on the policy board, and those are identified as the county of Santa Cruz, the county of Monterey, and the county of Salinas.

723
01:10:16,360 --> 01:10:17,660
Excuse me, the city of Salinas.

724
01:10:22,870 --> 01:10:31,110
So these next few slides talk about financing, Monterey Bay community power, and the need to, what types of support will need.

725
01:10:31,530 --> 01:10:38,870
Those include funding for startup costs, which are those costs incurred prior to CCE service commencement,

726
01:10:38,870 --> 01:10:42,490
working capital requirements as well as reserved deposits.

727
01:10:42,930 --> 01:10:49,430
The size of the start-up capital will depend on the size of the overall program, depending on how many jurisdictions actually join.

728
01:10:50,010 --> 01:10:58,790
The planning process, the number of customers, a marketing budget, also as well as the availability of municipal staff to support the project.

729
01:10:59,310 --> 01:11:08,550
So if county staff can assist through that process, as opposed to billable time, also includes the complexity of the initial CCA program.

730
01:11:08,550 --> 01:11:11,030
and how many moving parts it actually has.

731
01:11:12,290 --> 01:11:16,830
This slide outlines some of the costs that we are expected to incur.

732
01:11:18,190 --> 01:11:23,450
This total shows $2.25 million, but it also depends on what the number of jurisdictions

733
01:11:23,450 --> 01:11:27,970
that actually join, so this dollar amount could fluctuate, could be higher, could be lower.

734
01:11:28,730 --> 01:11:34,410
Some of the things that we'll need to cover are expanding the technical study that's already

735
01:11:34,410 --> 01:11:40,390
than done. We'll need to have staffing, marketing, and communications will have extensive outreach

736
01:11:41,070 --> 01:11:45,930
to the community in regards to this process, and as well as security

737
01:11:45,930 --> 01:11:49,410
deposits, and a CCE bond that's required by the CPUC.

738
01:11:51,950 --> 01:11:53,490
Through the PDAP recommendations,

739
01:11:54,050 --> 01:12:01,190
they're recommending a hopefully a potential zero and low interest rate loan to be repaid

740
01:12:01,190 --> 01:12:05,470
through a program of revenues, a credit guarantee for the start-up one.

741
01:12:06,590 --> 01:12:10,470
The County of Santa Cruz issued an RFP for banking services.

742
01:12:10,730 --> 01:12:17,010
Those, the RFP responses are received as of February 1st, and we're currently reviewing

743
01:12:17,010 --> 01:12:23,470
those and determining next steps, but we hope to return to your board in April with a recommendation.

744
01:12:27,270 --> 01:12:31,770
Longer term credit needs include working capital, which would be linked to the size of initial

745
01:12:31,770 --> 01:12:38,010
customer enrollment, the initial JPA operating cost as well as the size and cost of energy contracts.

746
01:12:38,890 --> 01:12:44,290
So again, the types of credit include startup capital, working capital, a credit guarantee,

747
01:12:44,790 --> 01:12:51,650
and a letter of credit and bond financing for additional power contracts and project development.

748
01:12:55,250 --> 01:12:59,150
This slide is the summary of all the city council meetings,

749
01:12:59,150 --> 01:13:06,950
support of supervisors, meetings, as you can see, again, four have passed the resolution

750
01:13:06,950 --> 01:13:13,950
and had their second readings. So the GP agreement states that after three jurisdictions

751
01:13:13,950 --> 01:13:22,350
have passed, the GP will be formed. We now have four, so we are official based on this

752
01:13:22,350 --> 01:13:22,910
information.

753
01:13:25,470 --> 01:13:32,810
So, this last slide is just a summary. 285,000 customers now spend 355 million

754
01:13:32,810 --> 01:13:39,310
per year on electricity, 30% of which comes from renewable resources. Our analysis shows

755
01:13:39,310 --> 01:13:44,810
that we can double our use of renewable energy resources, reduce our greenhouse gas emissions

756
01:13:44,810 --> 01:13:53,090
from electricity, use by 70% and still pay the same or comparable to PG&E rates. After a

757
01:13:53,090 --> 01:13:58,090
In a few years of full operations, building organizational capacity and paying sort of debt,

758
01:13:58,530 --> 01:14:01,730
the study shows surplus revenues of 8 to 9 million.

759
01:14:02,270 --> 01:14:07,510
These are funds that can help build local renewable projects, create jobs, and lower rates.

760
01:14:09,050 --> 01:14:16,730
Existing CTEs use a JPA similar to the one before you today and have accounted for 833 megawatts

761
01:14:16,730 --> 01:14:23,530
of new California renewables as of January 2017 and 1 billion in construction to date.

762
01:14:24,010 --> 01:14:30,230
The performance to date of the CCEs under JPA's similar to ours presented here suggests

763
01:14:30,230 --> 01:14:36,030
that more than ample capacity exists to derive the desired benefits from Monterey Bay Community

764
01:14:36,030 --> 01:14:42,490
Power, local workforce and the business community as well, while protecting ratepayers by allowing

765
01:14:42,490 --> 01:14:48,190
and locally controlled decision-making to have full flexibility to meet dark market demands.

766
01:14:49,250 --> 01:14:51,070
And now we're available for questions.

767
01:14:51,930 --> 01:14:55,790
All righty. I'll look to my fellow board members of their questions.

768
01:14:58,890 --> 01:14:59,970
No, I guess the-

769
01:15:00,000 --> 01:15:04,500
I want to hear from the public first. Is there members of the public who would like to come forward?

770
01:15:12,810 --> 01:15:36,790
Good morning supervisors. I'm Glenn Schaller. I'm the political coordinator at the Monterey Bay Central Labor Council AFL CIO. We're the union of unions for Monterey and Santa Cruz counties. We have over 70 unions in about 35,000 working families. I'm also speaking today for the Monterey Santa Cruz County's Building and Construction Trades Council. Both labor coalition strongly support the formation of the Monterey Bay Community Power.

771
01:15:36,790 --> 01:15:40,990
joint powers authority. Now you've received correspondence from Andy Hartman,

772
01:15:41,170 --> 01:15:44,750
and he's president of the building trades and business manager and financial

773
01:15:44,750 --> 01:15:49,990
secretary of IVW Local 234. We are concerned about the creation of good-paying

774
01:15:49,990 --> 01:15:54,590
jobs, the development of local renewable energy, the formation of a robust

775
01:15:54,590 --> 01:15:59,230
community advisory committee, and the creation of the innovators and far-reaching

776
01:15:59,230 --> 01:16:02,970
business plan. We're glad that the joint powers authority can address these issues

777
01:16:02,970 --> 01:16:07,610
as it forms, and we hope that the Monterey Bay Community Powers, Monterey Bay Community

778
01:16:07,610 --> 01:16:12,410
Power Joint Powers Authority, looks carefully at the Alameda County-based Community Choice

779
01:16:12,410 --> 01:16:17,210
Aggregation Model, which is recently formed. It's the East Bay Community Energy, and although

780
01:16:17,210 --> 01:16:22,510
I understand that Sonoma and Marin have been successful, we're very excited about a new

781
01:16:22,510 --> 01:16:26,410
model, and I'm hoping that the Joint Powers Authority will address that. We're proud as

782
01:16:26,410 --> 01:16:30,050
the two labor coalitions in our region to support the formation of the Monterey Bay Community

783
01:16:30,050 --> 01:16:35,150
power. During powers authority, and we look forward to assisting in its best start possible.

784
01:16:35,690 --> 01:16:40,810
Thank you. Mr. Schaller, can you just say briefly what's the difference between the

785
01:16:40,810 --> 01:16:46,890
Alameda County? Yes. So the East Bay Community Energy, which is recently formed, covers Alameda

786
01:16:46,890 --> 01:16:50,510
County and many of the jurisdictions there. Now, I have decided that at the beginning,

787
01:16:50,530 --> 01:16:54,590
at the formation of the JPA, that they'll address some of the issues that have been discussed

788
01:16:54,590 --> 01:17:00,970
in the formation of this, but have not been built into the agreement that jurisdictions are, no, I'm signing on to.

789
01:17:01,370 --> 01:17:06,930
We had asked at the beginning of this process about a month ago for jurisdictions to put in amendments.

790
01:17:07,190 --> 01:17:11,830
And we stopped asking for that because there's a disagreement amongst attorneys, that's never happened before.

791
01:17:12,110 --> 01:17:14,350
No, about whether amendments slow up the process.

792
01:17:14,770 --> 01:17:19,230
So what Alameda did, what East Bay did, is make sure that it's built into the JPA from day one.

793
01:17:19,690 --> 01:17:23,810
And I think the business plan from there needs to be looked at, I think, bringing some folks down from there.

794
01:17:23,810 --> 01:17:29,330
to talk as we move into the process of having the first meeting in the JPA could be very helpful.

795
01:17:30,090 --> 01:17:42,010
The other part is that it's not a dissimilar situation in terms of having one large jurisdiction in that case, Oakland, and then smaller jurisdictions, where in our case, we have Salinas and our cities combined.

796
01:17:43,290 --> 01:17:53,730
But I think also the question of governance, we're not asking you all to look at it, I understand that Monterey County has a dog in this hunt in terms of trying to make sure that the city of Salinas is well represented, the county's well represented.

797
01:17:53,730 --> 01:17:55,970
I think that can still be worked out.

798
01:17:56,550 --> 01:18:00,210
And I'm hoping we have 21 jurisdictions represented on that very first day.

799
01:18:00,990 --> 01:18:01,490
Thank you.

800
01:18:01,650 --> 01:18:02,210
All right, thank you.

801
01:18:04,740 --> 01:18:05,280
Good morning.

802
01:18:05,680 --> 01:18:06,040
Good morning.

803
01:18:06,380 --> 01:18:07,380
Good morning, supervisors.

804
01:18:08,000 --> 01:18:13,620
Rick Lonzani, today I'm representing the Sierra Club Santa Cruz County Group with 3000 members.

805
01:18:14,360 --> 01:18:17,380
And we basically want to echo Glenn Schauer's comments.

806
01:18:18,380 --> 01:18:25,240
We've written a letter that says that we would like to see an advisory board and

807
01:18:25,240 --> 01:18:37,380
and that we'd also like to encourage that this Monday Bay Community Power focus on renewable energy that's sourced locally rather than just statewide.

808
01:18:37,680 --> 01:18:46,220
We think that would create more local jobs but besides that, it would make our community more energy resilient for the hard times that may be coming ahead.

809
01:18:46,220 --> 01:18:55,360
So, thank you very much. We support this measure and encourage you to do what it takes to set up a community advisory board. Thank you.

810
01:18:55,480 --> 01:18:55,780
Thank you.

811
01:19:00,710 --> 01:19:01,290
Good morning.

812
01:19:02,110 --> 01:19:19,330
Good morning. My name is Becky Steinberger and I just want to lend my support to this great project and hope that as the speakers before me have said that it is local jobs built in to the agreement and that there is a good level of representation, local representation.

813
01:19:19,330 --> 01:19:26,470
I also want to ask a question if the folks from deep water, from deep water diesel have

814
01:19:26,470 --> 01:19:33,630
been brought into this discussion because they are planning a very large solar array

815
01:19:33,630 --> 01:19:41,970
down in the, I understand the Pinotu Valley to supply power for the deep water diesel plant

816
01:19:41,970 --> 01:19:46,750
with an auxiliary plant there in a backup of the PG&E plant there.

817
01:19:46,750 --> 01:20:16,650
It's not owned by PG&N anymore, I guess, but in Moss Landing and that will fund, that will power their data center, so I did look at, and this goes back a bit since an item on the consensus agenda, but the Monterey Bay Regents Solar Collaborative Procurement Initiative that this county is looking at six different sites, so I just want to make sure that that site that's already in the works and has a lot of money behind it is that they're at the table.

818
01:20:16,750 --> 01:20:17,730
Thank you.

819
01:20:18,110 --> 01:20:18,470
Thank you.

820
01:20:19,390 --> 01:20:21,190
Are there other members of the public?

821
01:20:23,860 --> 01:20:25,880
Well, seeing none, I'll bring it back.

822
01:20:26,180 --> 01:20:36,840
Maybe someone could answer the questions about local job creation and local energy generation and how that's going to be addressed as part of this new JPA.

823
01:20:38,560 --> 01:20:45,360
Those will be addressed in the implementation plan primarily, which is one of the first tasks of the policy board of this new JPA.

824
01:20:45,360 --> 01:20:54,000
Okay, and so that doesn't come back to this board that will go to that new board.

825
01:20:54,320 --> 01:21:07,160
That's correct, and that is why one of our recommendations was for you to consider whether you want to provide any direction regarding those issues to the representative from this board on that policy board.

826
01:21:07,480 --> 01:21:07,700
Okay,

827
01:21:13,370 --> 01:21:14,010
other questions?

828
01:21:15,370 --> 01:21:21,990
No, I just would like to say, I do appreciate when we first started talking about this four

829
01:21:21,990 --> 01:21:29,470
years ago in my office, we were looking at Santa Cruz County only and much of the dismay

830
01:21:29,470 --> 01:21:34,430
of those who wanted to get this done quickly, we said, let's see if the other two other

831
01:21:34,430 --> 01:21:41,350
counties would be interested, which would be probably the first tri-county community

832
01:21:45,110 --> 01:21:56,250
This is the benefit from this project can't be overstated, especially in the environmental sense of doubling our dependence on renewables.

833
01:21:56,870 --> 01:22:09,270
We can reach the goal that is set by the state for us for greenhouse gas emissions by probably 2020 or 21 for those goals that are set and are met by 2030.

834
01:22:10,190 --> 01:22:18,150
That's just something I know that the community of this county and the tri-count area will be very excited about.

835
01:22:18,870 --> 01:22:30,210
But keeping it at probably the same cost and getting to that double, doubling our dependence on renewable energy sources, local governance,

836
01:22:30,210 --> 01:22:40,190
and keeping capturing the revenues that come in for us to do more in the future for maybe low income residents.

837
01:22:40,410 --> 01:22:46,910
I know this is to be decided by the JPA itself or for school districts or whatever the case may be.

838
01:22:47,430 --> 01:22:56,830
The opportunities are just really tremendous for us to look forward to once this has been formally established.

839
01:22:56,830 --> 01:23:00,710
And the creation of jobs is going to be very important as well.

840
01:23:01,670 --> 01:23:14,590
This is an important element of all of this, but I think this is something that this state hasn't seen before, and it's going to be a tremendous asset for many, many years for the people of this county and the tri-county area.

841
01:23:15,330 --> 01:23:16,030
Thank you.

842
01:23:18,290 --> 01:23:19,330
Thank you.

843
01:23:19,690 --> 01:23:23,870
First, I want to take a moment and just recognize Mr. President Fearson and his staff,

844
01:23:24,010 --> 01:23:28,790
Danny Johnson, and the county staff who has worked heroically to take this move this

845
01:23:28,790 --> 01:23:29,490
project forward.

846
01:23:30,110 --> 01:23:35,470
We're watching at the federal level us go in the wrong direction in terms of climate change

847
01:23:35,470 --> 01:23:42,030
and environmental goals, and the fact that this region is going to be able to move and not only counteract

848
01:23:42,030 --> 01:23:49,230
counteract some of that negative actions, but actually move forward in a way that makes us more sustainable,

849
01:23:50,130 --> 01:23:55,190
creates more local jobs and proves our local economy, all that money that's being shipped out of this county,

850
01:23:55,770 --> 01:23:59,530
out of these counties every year, now states here it can be invested locally.

851
01:24:00,390 --> 01:24:03,910
Thank you for your vision and thank you for your hard work, I know it hasn't been easy,

852
01:24:04,390 --> 01:24:08,250
but this is a transformational project in the history of this region.

853
01:24:08,250 --> 01:24:13,750
And I'm, it's a big day, and you all should be very proud of your work.

854
01:24:16,630 --> 01:24:22,610
And I'm prepared to move the recommended action, the recommended actions.

855
01:24:22,950 --> 01:24:30,850
And for, in terms of appointing our members to the JPA, I would recommend that we appoint

856
01:24:30,850 --> 01:24:35,490
Sue Reiser McPherson as a primary member, and I'll nominate myself as the alternate.

857
01:24:35,490 --> 01:24:41,530
I also, in recognition of some of the members that spoke, the community members that spoke,

858
01:24:41,790 --> 01:24:47,130
the additional direction that I would offer if there's, if there's approved by the board

859
01:24:47,130 --> 01:24:51,950
would be that the board directs our appointees to the JPA to support the development

860
01:24:51,950 --> 01:24:56,810
of a business plan within two years that includes a road map for the development,

861
01:24:57,050 --> 01:25:02,630
procurement and integration of local renewable energy resources with a focus on local job

862
01:25:02,630 --> 01:25:04,990
of creation, transparency, and accountability.

863
01:25:05,990 --> 01:25:09,450
The business plan should be developed in partnership with the community, and

864
01:25:09,450 --> 01:25:11,810
should be a public document available for review.

865
01:25:12,250 --> 01:25:16,380
I'll second the supervisor friend.

866
01:25:16,660 --> 01:25:18,680
Thank you, and thank you for that additional direction.

867
01:25:19,200 --> 01:25:23,180
Again, supervisor McPherson, thank you for your leadership role on this, Ms. Johnson as well.

868
01:25:24,200 --> 01:25:29,520
This is, in many respects, is a historic moment as far as this, not just for

869
01:25:29,520 --> 01:25:32,700
this county, but I think for environmental protection for the multiple counties.

870
01:25:32,700 --> 01:25:38,440
as we move forward. It's been important to me the entire time that we have a focus on local

871
01:25:38,440 --> 01:25:43,840
renewable energy and a focus on local job creation. I think that those are elements that need

872
01:25:43,840 --> 01:25:49,420
to be brought into this process. And I think that it's important that it will be addressed at the

873
01:25:49,420 --> 01:25:53,860
next stage. But I appreciate that those elements were brought forward by the community. And I think

874
01:25:53,860 --> 01:25:58,800
that the different people will take different elements from this. Some people will focus on rights,

875
01:25:58,800 --> 01:26:24,520
Some will focus on the renewables, but I think everybody can get behind the fact that when you're creating good local jobs and you're having local renewable energy, I think everybody can agree that those are important elements and some looking forward to this moving forward. It's interesting to see something come from such a significant element come born from just an idea that was presented the board a few years ago and to watch a come through the entire process. So it's an exciting step forward for many. So thank you. Supervisor Capit.

876
01:26:25,900 --> 01:26:26,940
Supervisor Capit.

877
01:26:27,260 --> 01:26:30,500
Just a second motion, so I agree.

878
01:26:31,460 --> 01:26:36,860
Well, let me just say that I appreciate all the hard work that has gone into the creation

879
01:26:37,380 --> 01:26:38,980
of Monterey Bay community power.

880
01:26:41,800 --> 01:26:48,840
We have an opportunity here to have sort of a multiple, a double or triple bottom line,

881
01:26:48,840 --> 01:26:52,760
which is reducing our greenhouse gas emissions.

882
01:26:53,960 --> 01:26:56,800
The electricity generation is second only to transportation,

883
01:26:57,240 --> 01:26:58,400
but it's a huge part.

884
01:26:58,980 --> 01:27:01,120
And when we looked at our climate action strategy,

885
01:27:02,280 --> 01:27:05,880
reducing our emissions from our electricity generation

886
01:27:05,880 --> 01:27:09,040
was a big way in which we could meet our goals.

887
01:27:10,040 --> 01:27:14,180
This effort is the single biggest way

888
01:27:14,180 --> 01:27:17,240
that we could reduce our greenhouse gas emissions.

889
01:27:17,240 --> 01:27:18,520
So, that's fantastic.

890
01:27:19,280 --> 01:27:27,140
The local jobs and economic development aspect of it, the fact that there will be resources

891
01:27:27,140 --> 01:27:36,460
and a drive to build local energy generation that's renewable, will mean that people here

892
01:27:36,460 --> 01:27:41,620
in Santa Cruz or in the tri-county area have the possibility of being involved on the cutting

893
01:27:41,620 --> 01:27:46,080
edge of new technology and development of new energy resources.

894
01:27:47,140 --> 01:27:55,300
Lastly, the idea of giving the local community control over the power company is something

895
01:27:55,300 --> 01:28:01,360
that we hear pretty regularly when people have problems with PG&E, and the idea that

896
01:28:02,080 --> 01:28:09,780
it will be local government that will have the voice in the direction of our energy choices

897
01:28:09,780 --> 01:28:21,400
in the future. It's hugely important. I appreciate the addition of this direction about

898
01:28:21,400 --> 01:28:27,060
a business plan. I think it's the right move. We previously directed our appointees to

899
01:28:27,060 --> 01:28:33,320
also talk with the JPA about a project labor agreement as these new jobs are created.

900
01:28:33,320 --> 01:28:42,860
And I think it's an important way to ensure that what we local government help sponsor actually benefits the local community in lots of different ways.

901
01:28:43,200 --> 01:28:50,080
That's what local government does. It really looks about our environment, our economy, and the people who live here.

902
01:28:50,580 --> 01:28:55,440
So I'm really excited about this step today, and I'm going to support the motion.

903
01:28:55,440 --> 01:28:59,980
There's been a motion made by Supervisor Coonerty, seconded by a Supervisor

904
01:28:59,980 --> 01:29:02,680
Capit, all in favor signify by saying aye.

905
01:29:03,140 --> 01:29:03,460
All right.

906
01:29:03,680 --> 01:29:05,920
And he opposed motion carries unanimously.

907
01:29:06,600 --> 01:29:06,940
We're

908
01:29:11,420 --> 01:29:15,860
going to do one more item before break, which is item 50, considered the appointment

909
01:29:15,860 --> 01:29:20,380
of Stephen Horlock to the oversight board of the Scotts Valley, redevelopment successor agency.

910
01:29:21,860 --> 01:29:23,060
Move approval.

911
01:29:23,460 --> 01:29:23,820
Second.

912
01:29:24,320 --> 01:29:28,380
Motion by Coonerty, seconded by Mike Fiercen, anyone from the public?

913
01:29:28,380 --> 01:29:31,020
All in favor signify by saying aye.

914
01:29:31,280 --> 01:29:32,400
All right.

915
01:29:32,400 --> 01:29:32,820
Any opposed?

916
01:29:33,140 --> 01:29:34,140
Motion carries unanimously.

917
01:29:34,820 --> 01:29:37,100
With that, we were going to take a 15 minute break.

918
01:29:37,780 --> 01:29:41,560
And I will mind the board members that we have some birthday celebrations.

919
01:31:25,140 --> 01:31:55,120
Starting in 1996 with the Compassionate Use Act, then moving forward to the Medical Cannabis Regulatory and Safety Act of 2015, and then most recently last year, the Adult Use of Marijuana Act of 2016, which for the first time legalize the recreational use of cannabis products. Santa Cruz County has been keeping pace with the changes in state legislation and has enacted a number of different ordinances. And those ordinances address each of the different types of activities involved in the case.

920
01:31:55,120 --> 01:31:55,960
cannabis industry.

921
01:31:56,580 --> 01:32:02,500
At this point, it's probably best to take a look at how we address the cannabis industry.

922
01:32:02,920 --> 01:32:10,660
We kind of look at it in a supply chain order, so we look at cultivation, we look at manufacturing, and then we look at the retail sales or the dispensaries.

923
01:32:11,420 --> 01:32:25,100
On the cultivation end, the board has been considering for the past year back in June, August and November of 2016, a proposed cultivation ordinance that would regulate the commercial cultivation of medical care.

924
01:32:25,100 --> 01:32:29,880
cannabis, and your board has directed staff to prepare an environmental impact report

925
01:32:30,310 --> 01:32:35,340
that took a look at the proposed cannabis cultivation licensing program.

926
01:32:35,820 --> 01:32:40,800
Staff is currently working with the consultant firm of AMEC Foster Wheeler to prepare the

927
01:32:40,800 --> 01:32:46,040
environmental impact report, and at this time I will turn this over to Pia Levine, who will

928
01:32:46,040 --> 01:32:46,940
talk about the EIR.

929
01:32:47,320 --> 01:32:47,780
Thank you.

930
01:32:47,860 --> 01:32:48,560
Good morning, everybody.

931
01:32:49,720 --> 01:32:52,320
So the EIR on cannabis regulation is underway.

932
01:32:52,320 --> 01:32:56,980
Currently, the consultant team is working to analyze information, continue collecting

933
01:32:56,980 --> 01:33:02,860
information, and they've been performing initial field work that will inform their work.

934
01:33:03,440 --> 01:33:08,060
The notice of preparation for the EIR was released February 13th.

935
01:33:08,060 --> 01:33:12,920
That began a 30-day period for receiving comments on the scope and the content of the document,

936
01:33:13,420 --> 01:33:15,880
and that period ends March 15th.

937
01:33:16,840 --> 01:33:20,220
Last evening, we had a scoping meeting at the Simkin Swim Center.

938
01:33:20,220 --> 01:33:26,380
It was very well attended. There were 60-plus people there. We received comments on the zoning

939
01:33:26,380 --> 01:33:32,000
in which cultivation will be allowed, particularly TPA and A, when it is near residential zoning,

940
01:33:32,740 --> 01:33:38,240
comments on minimum parcel size, comments on where manufacturing should be allowed, and there

941
01:33:38,240 --> 01:33:42,300
was interest in characteristics of the alternatives that the EIR should analyze.

942
01:33:44,040 --> 01:33:49,140
It's unusual to have a detailed idea of project alternatives this early in an EIR process.

943
01:33:49,140 --> 01:33:56,380
The alternatives usually come out of the analysis and they're contemplated as ways of mitigating

944
01:33:56,380 --> 01:33:58,120
any impacts that are identified.

945
01:33:58,700 --> 01:34:03,880
In this case, we have some information about alternatives that the EIR will look at,

946
01:34:03,980 --> 01:34:09,500
and the goal of that is to give your board information about the right range of situations

947
01:34:09,500 --> 01:34:13,220
so that you can do your thinking ultimately when you look at the project.

948
01:34:13,220 --> 01:34:20,540
But the EIR will analyze the proposed project, which is the proposed replacement ordinance 7.128,

949
01:34:20,780 --> 01:34:23,720
and also a more permissive version of that project.

950
01:34:24,260 --> 01:34:29,460
And also, a typically, the EIR will look at both of those in an equal level of detail.

951
01:34:31,640 --> 01:34:37,700
The EIR will look at some alternatives to those two projects, including a more permissive alternative

952
01:34:37,700 --> 01:34:45,560
that will allow cultivation in yet more situations and a more restrictive alternative that will

953
01:34:45,560 --> 01:34:48,880
look at allowing cultivation in many fewer locations.

954
01:34:49,720 --> 01:34:54,140
The alternatives are analyzed in less detail than the two projects, and according to

955
01:34:54,140 --> 01:34:57,460
SQL, we also will be looking at no project alternative.

956
01:34:58,860 --> 01:35:04,800
Lastly, the EIR is expected to, a draft EIR is expected to be published by June 1.

957
01:35:04,800 --> 01:35:08,820
That will lead to a 45-day comment period on the draft.

958
01:35:09,420 --> 01:35:14,500
We are thinking it would be a good idea to have a study session with your board during

959
01:35:14,500 --> 01:35:19,500
that 45-day period to allow a look at the draft altogether.

960
01:35:20,520 --> 01:35:24,200
And a final is expected out in mid-September.

961
01:35:25,020 --> 01:35:30,060
Public hearings would follow that, planning commission, we believe could look at the document

962
01:35:30,060 --> 01:35:35,620
in October and the project, and your board would be seeing that in November of this year.

963
01:35:38,020 --> 01:35:42,620
That concludes the status report. I'm available for questions, and thank you very much.

964
01:35:43,320 --> 01:35:44,600
Anything else, Mr. Peterson?

965
01:35:45,820 --> 01:35:46,740
Not on the EAR.

966
01:35:47,420 --> 01:35:51,680
Any questions, particularly about the EAR, then we'll continue on.

967
01:35:52,500 --> 01:35:56,900
Okay, very good. Moving on, still with the cultivation theme,

968
01:35:56,900 --> 01:36:04,660
The county held a 90-day registration process for people who wanted to apply for a commercial cultivation license.

969
01:36:05,020 --> 01:36:12,640
That 90-day process ended on November 6th of 2016, over 950 applicants opened an online account.

970
01:36:13,780 --> 01:36:21,700
760 people actually finished the process, submitted all the required documentation, and paid the registration fee.

971
01:36:21,700 --> 01:36:30,720
Of those 760, 489 of those individuals registered anonymously, while 271 did provide their

972
01:36:30,720 --> 01:36:34,020
name and their address and the characteristics of what they were proposing.

973
01:36:34,700 --> 01:36:41,040
Those non-anonymous registrants do have a benefit in that they are eligible to receive

974
01:36:41,040 --> 01:36:43,920
a pre-licensing inspection of the cultivation site.

975
01:36:44,360 --> 01:36:46,820
These inspections are completely voluntary.

976
01:36:47,220 --> 01:36:49,840
They are considered to be a benefit to the applicant.

977
01:36:49,840 --> 01:36:58,860
My team and I would go out to their site, would review the characteristics of this site and compare them against the requirements in the proposed ordinance code.

978
01:36:59,460 --> 01:37:06,100
And would come up with a list of any concerns that could possibly interfere with the applicant finally receiving their license.

979
01:37:06,700 --> 01:37:12,940
And we would also go over options of how the applicant could come into compliance prior to the final licensing process.

980
01:37:12,940 --> 01:37:26,240
The final benefit would be that the people who go through the pre-licensing inspection process would also receive priority when it comes times to the final issuance of a license because we've already done so much of the legwork on those parcels.

981
01:37:29,550 --> 01:37:44,610
That leaves us to cultivation for personal use. Currently our ordinance code chapter 7.126 allows individuals who are qualified patients to cultivate up to 100 square feet of cannabis

982
01:37:44,610 --> 01:37:46,370
this for personal medical use.

983
01:37:46,950 --> 01:37:54,310
Staff has not seen any issues with how this is performing and does not recommend any changes to the cultivation on the medical side.

984
01:37:55,030 --> 01:37:58,850
The adult use of marijuana act, which was passed in November of last year,

985
01:37:59,750 --> 01:38:08,870
changed the rules and now allows people to grow people over the age of 21 to cultivate up to six plans for personal use non medical.

986
01:38:09,430 --> 01:38:13,370
So this is a change and it's not currently addressed in any of our ordinances.

987
01:38:13,370 --> 01:38:28,090
After working with local stakeholder groups, we recommend that if agreeable to the board, staff work with county council and we would come back to you with a proposed ordinance on personal cultivation for non-medical use, that would include the following provisions.

988
01:38:28,810 --> 01:38:37,630
Number one would be that only one cultivation site is allowed per parcel, so you couldn't have a number of adults on a single parcel each growing their own six plants.

989
01:38:37,630 --> 01:38:45,830
No more than six living plants may be cultivated indoors inside a residential structure, or within an

990
01:38:46,870 --> 01:38:49,690
Ancillary building to that residential structure.

991
01:38:50,350 --> 01:38:54,070
The residents must be occupied by a person over the age of 21.

992
01:38:54,630 --> 01:39:00,190
If it's a permanent structure that's being used, it has to be, it has to have all the necessary required permits.

993
01:39:01,050 --> 01:39:06,570
All buildings where cannabis is cultivated or stored would have to be secured against an authorized entry,

994
01:39:06,570 --> 01:39:08,850
protected against children or visitors.

995
01:39:09,410 --> 01:39:13,830
If the occupant of the residence is not the owner, then the occupant would be required to

996
01:39:13,830 --> 01:39:18,750
get written consent from the owner for cultivation or processing of cannabis products.

997
01:39:19,210 --> 01:39:24,230
There would be no flammable products allowed for the cultivation or extraction of cannabis.

998
01:39:25,070 --> 01:39:29,450
And then finally cannabis plants must not be visible from the public right of way or from

999
01:39:29,450 --> 01:39:30,350
adjacent structures.

1000
01:39:31,270 --> 01:39:41,110
So, what we propose is that staff would return to the board with a draft ordinance for your provision or for your consideration, and we could return before budget hearings with that.

1001
01:39:44,280 --> 01:39:47,820
I have a question, so this is the end of this section.

1002
01:39:48,020 --> 01:39:49,900
Yeah, if you want to ask questions about this.

1003
01:39:50,300 --> 01:39:54,020
Sure. So, two questions. One about the commercial cultivation piece.

1004
01:39:54,020 --> 01:40:01,540
If we have some of our current registrants are not paying taxes, do we plan on reopening

1005
01:40:01,540 --> 01:40:08,360
the registration process in order to allow potentially new growers to pay, who may be willing

1006
01:40:08,360 --> 01:40:08,980
to pay taxes?

1007
01:40:09,680 --> 01:40:14,580
Well, Ashley, this is a good point I was going to discuss this under the Canada's business

1008
01:40:14,580 --> 01:40:17,160
tax section, but you are absolutely correct.

1009
01:40:17,320 --> 01:40:21,760
We've only had 39 new businesses that have registered to pay taxes.

1010
01:40:21,760 --> 01:40:28,440
their cannabis business tax since November. Obviously, if we have 760 applicants for commercial

1011
01:40:28,440 --> 01:40:34,920
cultivation, we should have more. Now, one of the issues is that is our timing. Measure

1012
01:40:34,920 --> 01:40:43,220
e past in November, we missed the outdoor harvest and sales for outdoor grows. That took place

1013
01:40:43,220 --> 01:40:49,740
since September, October. So, what we should be seeing now are periodic spikes in revenues from

1014
01:40:49,740 --> 01:40:53,380
the cannabis business tax as the indoor grows are cultivated and those are typically on

1015
01:40:53,380 --> 01:40:54,300
a three month cycle.

1016
01:40:55,200 --> 01:40:59,960
So what I'm hoping will happen is that we will see a spike within the next few weeks where

1017
01:40:59,960 --> 01:41:02,640
we start seeing the first harvest of those indoor grows.

1018
01:41:03,400 --> 01:41:11,700
However, because we have seen such a low application rate or excuse me, submittal rate for paying

1019
01:41:11,700 --> 01:41:17,100
their cannabis business tax is what we would like to do is send out a letter to everybody

1020
01:41:17,100 --> 01:41:23,920
who has requested a commercial cultivation license telling them that they have to register

1021
01:41:23,920 --> 01:41:31,340
with the auditor by June 30th of this year for the cannabis business tax payment or they

1022
01:41:31,340 --> 01:41:34,800
would be considered disqualified from moving forward in the licensing process.

1023
01:41:35,240 --> 01:41:41,200
I think that a lot of folks have either under the impression that they don't have to register

1024
01:41:41,200 --> 01:41:46,840
until it gets up to a dollar amount that seems reasonable or they simply haven't had any

1025
01:41:46,840 --> 01:41:48,860
revenues yet because they're doing outdoor grows.

1026
01:41:49,380 --> 01:41:54,920
This would encourage people to register for paying their taxes and would make sure that

1027
01:41:54,920 --> 01:41:59,920
the cannabis community understands that paying your taxes is a prerequisite to having a license.

1028
01:42:00,160 --> 01:42:06,580
But at this time, we are not considering opening up a phase two registration application process.

1029
01:42:06,580 --> 01:42:15,320
Quite bluntly with 760 applicants at this point, we're going to be pretty busy for the remainder of this year just going through all of those and doing the site inspections.

1030
01:42:16,060 --> 01:42:23,140
I would propose that I come back before the Board in late summer, early fall, and give you an update on how we're doing on that.

1031
01:42:24,280 --> 01:42:35,300
And then my second question is around the personal grows. Actually, it's two questions. One question is by eliminating it to indoor grows.

1032
01:42:35,300 --> 01:42:42,620
But what are we looking at in terms of making it easy for people to be in compliance

1033
01:42:42,620 --> 01:42:51,660
with greenhouses or sort of hoop houses in different ways that are not costly to be able

1034
01:42:51,660 --> 01:42:53,320
to meet this requirement?

1035
01:42:54,140 --> 01:42:59,160
And that's a very serious consideration that we had given.

1036
01:42:59,300 --> 01:43:03,240
And that's why the language was crafted in such a way that we said ancillary building,

1037
01:43:03,240 --> 01:43:08,180
not a structure. The definition of a structure means it's a permanent, non-movable building.

1038
01:43:08,700 --> 01:43:14,160
However, an ancillary building would include something that could be movable, that could be temporary,

1039
01:43:14,480 --> 01:43:19,020
and would allow something less than a full-blown permitted structure on a foundation.

1040
01:43:19,720 --> 01:43:26,340
Okay. And the second part is sort of why do we want to get into the business of regulating personal for us?

1041
01:43:27,280 --> 01:43:30,380
Well, the biggest reason is simply neighborhood compatibility.

1042
01:43:30,920 --> 01:43:35,920
One of the biggest complaints that I've experienced, both in Sutter County and

1043
01:43:35,920 --> 01:43:41,060
Ube County and then down here, is the fact that outdoor grows, quite bluntly, they smell.

1044
01:43:41,820 --> 01:43:46,780
And if you grow them too close to an adjacent property, it really does affect their neighbors.

1045
01:43:47,360 --> 01:43:50,320
That's why indoor grows that can be secured.

1046
01:43:50,640 --> 01:43:55,280
And also, the prevent the smell and the visual impact on their neighbors,

1047
01:43:55,280 --> 01:44:01,860
It seems to be a very good idea, and hopefully by being not terribly restrictive

1048
01:44:01,860 --> 01:44:08,500
and allowing the use of ancillary buildings should keep it from being too monetarily

1049
01:44:08,500 --> 01:44:10,340
expensive for people to comply.

1050
01:44:11,000 --> 01:44:16,360
And this doesn't impact people who are growing from medicinal purposes.

1051
01:44:16,580 --> 01:44:16,960
Not at all.

1052
01:44:17,220 --> 01:44:19,780
That continues to be covered under the existing orders.

1053
01:44:20,460 --> 01:44:20,560
Okay.

1054
01:44:20,700 --> 01:44:20,940
Thank you.

1055
01:44:21,560 --> 01:44:23,220
I had a question related to that.

1056
01:44:23,220 --> 01:44:29,340
the question of indoor outdoor. You talked at the end about not having it visible from a public

1057
01:44:29,340 --> 01:44:38,000
right away, but if it's indoors, I mean, I mean, I'm not sure we need to have an indoor

1058
01:44:38,000 --> 01:44:43,420
only restriction. I would like this to see if, you know, we allow people currently to

1059
01:44:43,420 --> 01:44:52,560
go up to 100 square feet if they have a card to grow indoor or outdoor. But if we're only

1060
01:44:52,560 --> 01:44:58,760
if you're suggesting that we only limit up personal grows to indoor locations.

1061
01:45:00,000 --> 01:45:12,960
And we have this list of things they have to get through. The idea that somehow it's going to be nom observable by anybody seems a little much.

1062
01:45:15,600 --> 01:45:27,060
I think there's six plans that it doesn't create a visual blight or even an extraordinary smell for people who want to grow outdoors.

1063
01:45:27,060 --> 01:45:33,100
And so, I hope when we talk about this, that we can talk about whether let people

1064
01:45:33,100 --> 01:45:38,440
grow indoor or outdoor, but it seems extraordinary to say you can only grow indoor, and it still

1065
01:45:38,440 --> 01:45:43,780
has to be non observable by anybody driving by because or by a neighbor or anything,

1066
01:45:43,980 --> 01:45:50,060
because you know, then you're talking about a windowless room, and that may or may not

1067
01:45:50,060 --> 01:45:54,840
be something that people want to do, and it seems like an extraordinary request.

1068
01:45:55,760 --> 01:46:02,220
If I could just add to Dan's response, again, the idea here is not indoor meaning like

1069
01:46:02,220 --> 01:46:02,760
in a building.

1070
01:46:03,000 --> 01:46:07,660
It would include any kind of enclosure that would just make it not be visible to the

1071
01:46:07,660 --> 01:46:12,860
people around it and to be able to secure it from an authorized entry.

1072
01:46:13,320 --> 01:46:21,340
So even something like a garden enclosure would be sufficient as long as the sides again

1073
01:46:21,340 --> 01:46:23,320
were not visible.

1074
01:46:23,320 --> 01:46:27,960
So the idea is not that it would be in a building or in your garage or in your home.

1075
01:46:27,960 --> 01:46:32,600
It would be in some kind of a greenhouse structure or a hoophouse structure or some kind

1076
01:46:32,600 --> 01:46:36,760
of, you know, a garden enclosure that would allow it to be somewhat secured.

1077
01:46:37,120 --> 01:46:42,720
What we're trying to do is avoid a million telephone calls from people who are concerned

1078
01:46:42,720 --> 01:46:45,280
about their neighbors growing plants and their yards.

1079
01:46:45,620 --> 01:46:52,400
So we just want to try to suggest that we provide these enclosures as a means of minimizing

1080
01:46:52,400 --> 01:46:53,180
I think some of that?

1081
01:46:53,660 --> 01:46:57,460
Yeah, it just, it seems, you know, there's a lot of things that people do in their

1082
01:46:57,460 --> 01:46:57,940
backyards.

1083
01:47:00,140 --> 01:47:04,420
And some of the things, some of the things aren't very pretty, right?

1084
01:47:04,480 --> 01:47:10,280
I mean, I mean, you know, if we looked at people's backyards, we would see, you know,

1085
01:47:10,420 --> 01:47:11,080
rusted structures.

1086
01:47:11,180 --> 01:47:15,240
We would see shacks that have been broken down.

1087
01:47:15,460 --> 01:47:17,600
It's visual blight, but it's their backyard.

1088
01:47:17,600 --> 01:47:23,180
And so the idea that somehow we're going to try to prevent someone from seeing a plan

1089
01:47:23,180 --> 01:47:28,340
just, it seems like we're drawing an unnecessary line.

1090
01:47:28,720 --> 01:47:31,900
So certainly that's your board's ultimate decision.

1091
01:47:32,200 --> 01:47:33,280
I appreciate your perspective.

1092
01:47:33,900 --> 01:47:38,300
If there are any more questions about personal cultivation, Supervisor Caffer?

1093
01:47:39,240 --> 01:47:44,480
Well, if you looked at my back here, I just see a lot of broken toys.

1094
01:47:44,480 --> 01:47:46,260
So anyway.

1095
01:47:46,580 --> 01:47:47,140
We nat up.

1096
01:47:51,240 --> 01:48:02,200
If maybe I'm one of the few that don't get it, there seems to be, if you can define anonymous

1097
01:48:02,200 --> 01:48:13,260
and nonanonymous applications, because I'm not sure there's a lot of anonymous applications

1098
01:48:13,260 --> 01:48:14,720
compared to the other way.

1099
01:48:15,480 --> 01:48:20,120
The anonymous applicants, all they had to provide, was a working email address,

1100
01:48:20,320 --> 01:48:23,460
which is how we contact them, and how we identify them.

1101
01:48:23,520 --> 01:48:26,160
They did not provide their name or their eye address.

1102
01:48:26,700 --> 01:48:31,000
Mostly due to concerns about security, they didn't want any chance of their

1103
01:48:31,000 --> 01:48:35,400
cultivation site being published, you know, the address being published, so that

1104
01:48:35,400 --> 01:48:37,960
people could pay them a visit in the night and borrow their plants.

1105
01:48:38,640 --> 01:48:42,960
The people who filed this non-anonymous, obviously, they did provide

1106
01:48:42,960 --> 01:48:47,220
their name, their address, their phone number, that means of contacting, and provide a lot

1107
01:48:47,220 --> 01:48:53,640
of other data that is very useful for us in terms of trying to anticipate how many indoor

1108
01:48:53,640 --> 01:48:58,000
grows, how many outdoor grows, what region are they growing in, are they growing up in the hills,

1109
01:48:58,200 --> 01:49:02,640
are they growing down in the valley area, what water source are they going to use. And those are

1110
01:49:02,640 --> 01:49:11,180
things that are of great interest to us. And really, we try to incentivize people to register

1111
01:49:11,180 --> 01:49:21,240
as a non-anonymous applicant by virtue of the pre-licensing inspections, which we think will benefit both the county and the individual applicants.

1112
01:49:22,880 --> 01:49:39,480
And then with, eventually, anonymous would have, they would have to, if they went through the whole process and they were granted, let's say, a permit or whatever, they would then become non-anonymous.

1113
01:49:39,480 --> 01:49:49,340
That is correct. Once the EIR is completed and the board has adopted the final version of the ordinance we would be sending out an email telling the anonymous applicants.

1114
01:49:49,340 --> 01:49:56,740
Now you have to decide if you want to proceed with the process. You will have to become a non-anonymous applicant at this point.

1115
01:49:56,840 --> 01:50:04,280
You will have to provide a name and an address which is necessary for us to go out and do the site inspections and do all of the background checks.

1116
01:50:04,860 --> 01:50:09,140
So yes, at some point before a license is issued, they have to make that transition.

1117
01:50:09,760 --> 01:50:17,440
Okay, and I guess the last thing I'll ask, if you noticed, since the election in November,

1118
01:50:18,680 --> 01:50:22,640
we have, you know, recreational use is going to be okay.

1119
01:50:23,360 --> 01:50:28,480
And then all of a sudden, that changes everything from compassion to money.

1120
01:50:28,480 --> 01:50:35,220
So money is money now the driving force rather than compassion for all these

1121
01:50:35,220 --> 01:50:41,920
grows. That's obviously money, right? I think it depends on the grower. I would

1122
01:50:41,920 --> 01:50:46,500
have to say during my five months here now in Santa Cruz County I've had the

1123
01:50:46,500 --> 01:50:53,040
honor of meeting a number of the cultivators and I have been very impressed by the

1124
01:50:53,040 --> 01:50:57,780
fact that many many of them are not in this for the money that they truly do have a

1125
01:50:57,780 --> 01:51:03,440
desire to provide a quality medical product. Obviously, there are going to be business

1126
01:51:03,440 --> 01:51:09,580
people that are going to be cultivating for profit. Absolutely nothing wrong with that,

1127
01:51:09,680 --> 01:51:16,700
but I do not see that the Adult ESA marijuana act is going to impact natively those growers

1128
01:51:16,700 --> 01:51:19,100
that are truly doing it for a medicinal purpose.

1129
01:51:20,220 --> 01:51:21,080
Thank you.

1130
01:51:22,280 --> 01:51:25,440
Why don't you continue, Mr. Peterson, with your presentation.

1131
01:51:25,440 --> 01:51:31,080
So, moving away from the cultivation cycle, now move to the next step, which is the manufacturing.

1132
01:51:31,840 --> 01:51:36,560
Currently, our ordinance code does not address the manufacturing of cannabis products.

1133
01:51:37,360 --> 01:51:49,080
And after consultation with county council, staff believes that the board may wish to consider adopting a new ordinance that does regulate the manufacturing of cannabis products.

1134
01:51:49,080 --> 01:51:56,820
A very, very preliminary draft was provided for the board to generate discussion and to

1135
01:51:56,820 --> 01:51:58,540
promote input.

1136
01:51:59,280 --> 01:52:05,400
As currently envisioned, the ordinance would require licensing for manufacturers of cannabis products,

1137
01:52:05,860 --> 01:52:10,260
and would restrict manufacturing activities into appropriate zoning districts.

1138
01:52:11,420 --> 01:52:15,980
If you look at manufacturing, one can broadly break it into two categories,

1139
01:52:15,980 --> 01:52:26,100
extraction, and then everything else, the infusion and actual preparation of products intended for consumption or in some form of a cream or anointment.

1140
01:52:26,900 --> 01:52:35,020
Now, the extraction can be further broken down into two subcategories, and we call them volatile and non-volatile, although I think will probably change those terms.

1141
01:52:35,860 --> 01:52:43,900
But quite generally speaking, the extraction activities that use volatile solvents, such as butane, hexane, propane,

1142
01:52:45,900 --> 01:52:53,060
CO2 carbon dioxide that's raised to pressures beyond 5,000 psi, we would categorize in a higher

1143
01:52:53,060 --> 01:52:59,300
risk category that would be restricted to a manufacturing zone, an M1, an M2, or an M3.

1144
01:52:59,900 --> 01:53:03,900
And by the way, the chart that was in the draft ordinance left off M1, so M1 should be

1145
01:53:03,900 --> 01:53:04,420
allowed on there.

1146
01:53:05,140 --> 01:53:10,820
Extraction activities that are using non-volatile solvents, and that includes carbon dioxide with

1147
01:53:10,820 --> 01:53:17,180
pressures less than 5,000 psi would be allowed in commercial zones and the manufacturing zones

1148
01:53:17,180 --> 01:53:22,960
plus in CA and A. And the reason that we're proposing this is that makes it consistent

1149
01:53:22,960 --> 01:53:29,620
with the existing regulations, zoning regulations that apply to vineyards and wineries and a production

1150
01:53:29,620 --> 01:53:36,120
of wine. Manufacturing activities on CA and A would still be permissible to the extent

1151
01:53:36,120 --> 01:53:41,220
that manufacturing process, that specific process is consistent with requirements of that zone.

1152
01:53:41,980 --> 01:53:49,380
Any extraction process that is utilizing a liquefied hydrocarbon, such as a butane or a propane,

1153
01:53:50,080 --> 01:53:55,320
would have to be a closed loop system and would also have to be certified by a licensed engineer.

1154
01:53:56,400 --> 01:54:02,160
And then finally, the activities that involve the infusion of cannabis into final products,

1155
01:54:02,160 --> 01:54:03,760
such as edibles or creams.

1156
01:54:04,600 --> 01:54:07,960
Those would be allowed once again in commercial zones,

1157
01:54:08,400 --> 01:54:11,780
in manufacturing zones, and also in CA and A,

1158
01:54:12,340 --> 01:54:15,540
and in special use zones if the underlying general zone designation

1159
01:54:16,500 --> 01:54:18,180
allows that type of activity.

1160
01:54:19,260 --> 01:54:23,760
So, I would like to reiterate that this is a very rough draft

1161
01:54:23,760 --> 01:54:26,200
that we presented to the board of the manufacturing ordinance.

1162
01:54:26,760 --> 01:54:29,780
We are still refining the terms and trying to decide

1163
01:54:29,780 --> 01:54:39,140
which manufacturing processes go into that volatile category and which go into the non-volatile alcohol distillation, for example, is one that could go either way.

1164
01:54:39,420 --> 01:54:46,560
We're working with the fire chiefs to come up with the best definition and the best siding requirements for those.

1165
01:54:47,380 --> 01:54:53,400
And we will return at some point with an improved draft at the Board's direction.

1166
01:54:54,400 --> 01:54:55,200
Supervisor Friend.

1167
01:54:55,420 --> 01:54:55,880
Thank you, Chairman.

1168
01:54:55,980 --> 01:55:00,520
I have a question just for clarification on the manufacturing activities on C&A because

1169
01:55:01,000 --> 01:55:07,100
the language here is quite vague to the extent that the manufacturing process is consistent

1170
01:55:07,100 --> 01:55:08,800
with the requirements of that zone.

1171
01:55:09,460 --> 01:55:13,340
When we were going through the initial scoping for the EIR, we'd add discussions about in

1172
01:55:13,340 --> 01:55:16,500
the coastal zone that we didn't want new structures to be constructed, and then we were

1173
01:55:16,500 --> 01:55:19,160
trying to prioritize those that were existing structures.

1174
01:55:20,100 --> 01:55:39,400
I have a concern that in a CAIR A zone that this would lead to a significant amount of new development of manufacturing structures on primarily agricultural parcels, which I don't think would be the intent of the board to do that kind of, quote-unquote, conversion of eggplant, even though it's for an ag purpose, but it's still the construction of a structure.

1175
01:55:39,860 --> 01:55:43,300
Is there any differentiation here in the language?

1176
01:55:43,300 --> 01:55:47,620
which again all I have is a sentence here that says consistent with the requirements of

1177
01:55:47,620 --> 01:55:52,600
that zone. Under what you're arguing for the vineyard he would theoretically be consistent

1178
01:55:52,600 --> 01:56:00,360
but given that this has a different margin I'd say that a vineyard would have and which

1179
01:56:00,360 --> 01:56:04,880
is why there's so much interest in this and some respects. I have concerns of a wholesale

1180
01:56:04,880 --> 01:56:10,360
change over or a sort of what would be deemed the highest best use to CA and A because

1181
01:56:10,360 --> 01:56:14,980
is the value of this and turning some of those lands into manufacturing locations,

1182
01:56:14,980 --> 01:56:19,400
which is not really, I think, the goal of the board or historically the board.

1183
01:56:19,460 --> 01:56:22,100
So I just want to make sure that there's language that actually, or if you could

1184
01:56:22,100 --> 01:56:24,340
as an answer that, or there's some sort of protections that would prevent that.

1185
01:56:24,760 --> 01:56:28,160
And at this point, we are still working on the language that goes into there.

1186
01:56:28,600 --> 01:56:34,740
What I've been told by the planners that have been assisting us on this is that in CA and

1187
01:56:34,740 --> 01:56:48,500
A zones, the manufacturing is going to be an ancillary activity, it's not going to be the primary activity on that site, and we're going to be restricting it, and we haven't decided what percentage of the total parcel size is restricted to.

1188
01:56:49,260 --> 01:56:58,100
However, when you look at a manufacturing center or facility, they're typically quite small.

1189
01:56:58,700 --> 01:57:06,700
It only takes maybe 150, 200 square feet for an extraction machine, and then you'd have a dryer.

1190
01:57:07,400 --> 01:57:11,760
So, you're only looking at a few hundred square feet on a parcel that would be dedicated

1191
01:57:11,760 --> 01:57:16,560
towards manufacturing unless it was a commercial kitchen or something of that nature.

1192
01:57:16,680 --> 01:57:21,940
And we will be putting language into the ordinance that puts an upper limit as to how much

1193
01:57:21,940 --> 01:57:24,400
of a facility you can put on a CA or an A-land.

1194
01:57:24,400 --> 01:57:54,380
I appreciate that. I appreciate that. I'll say that within my district, this is completely unrelated, but as a point of illustration, I have an individual that runs a skydiving business that actually lands as skydiving individuals on a land because he actually grows turf on that land. And so therefore landing people on the grass is ancillary use is primary use is the fact that he grows turf unique interpretation of the code to say the least, but actually defended mostly by planning as true.

1195
01:57:54,400 --> 01:58:00,300
right? Because it's not as primary usage of the land. I just want to raise a note of caution

1196
01:58:00,300 --> 01:58:06,360
about how hard we fight to protect agricultural primary uses in this county and that I don't

1197
01:58:06,360 --> 01:58:12,620
want to see a and a lands converted over into manufacturing locations as defined by

1198
01:58:12,620 --> 01:58:18,360
Ansler uses or even the primary use, basically just being whatever it is in order to really

1199
01:58:18,360 --> 01:58:24,260
have the financial component being the manufacturing element. So I want to make sure we lock down

1200
01:58:24,260 --> 01:58:26,760
on the language on that, and that we don't see areas

1201
01:58:26,760 --> 01:58:28,500
throughout my district or the Pahero Valley turn

1202
01:58:28,500 --> 01:58:30,180
into what just looks like a bunch of structures

1203
01:58:30,180 --> 01:58:30,680
for manufacturing.

1204
01:58:31,760 --> 01:58:32,020
Understood.

1205
01:58:32,300 --> 01:58:32,540
Thank you.

1206
01:58:32,880 --> 01:58:32,960
Thank you.

1207
01:58:34,020 --> 01:58:34,820
Supervisor McPherson.

1208
01:58:34,920 --> 01:58:35,000
Yeah.

1209
01:58:35,100 --> 01:58:36,800
I don't know if it's the right way to categorize it.

1210
01:58:37,160 --> 01:58:39,540
How many, what percentage of our manufacturer

1211
01:58:39,540 --> 01:58:42,900
are volatile or non-volatile, or are the processes?

1212
01:58:43,980 --> 01:58:46,500
Do you have any estimate about the percentages?

1213
01:58:46,740 --> 01:58:46,980
No.

1214
01:58:47,280 --> 01:58:47,920
I don't.

1215
01:58:48,420 --> 01:58:50,360
The one thing I can't tell you is, at first,

1216
01:58:50,460 --> 01:58:53,060
when I started this process, I was inclined to just

1217
01:58:53,060 --> 01:58:55,680
simply say we weren't going to allow volatile extraction whatsoever.

1218
01:58:56,540 --> 01:59:01,840
And it wasn't until after I sat down and spoke with Dr. Leff, I learned that the volatile

1219
01:59:01,840 --> 01:59:07,900
extraction is necessary to preserve the entire entourage is what they call it of cannibloids

1220
01:59:07,900 --> 01:59:12,720
which provide medicinal benefit, so you have to have not just the THC which is the fun

1221
01:59:12,720 --> 01:59:17,360
stuff that gets you high, but the CBD and the terpenes which have, you know, when placed

1222
01:59:17,360 --> 01:59:20,920
together this effect that makes it effective is medicine.

1223
01:59:21,860 --> 01:59:35,460
So volatile extraction is necessary if you're going to keep it as a medicinal product and that's so the bottom line becomes how much of the product is going to be sold for medicinal purposes where you want that full on tarage and how much is going to be for recreational.

1224
01:59:36,320 --> 01:59:43,040
There will probably be a bit of a shift in that ratio because of the passage of a Yuma after January 1st of 2018.

1225
01:59:44,060 --> 01:59:48,480
Right now I really don't have a good idea as to what the proportions would be.

1226
01:59:51,280 --> 01:59:54,320
I just had a couple comments about the cultivation ordinance.

1227
01:59:54,680 --> 01:59:58,860
I know it's just a start that's going to be fleshed out a little bit more.

1228
02:00:00,000 --> 02:00:16,180
I reviewed it, it looked like there were some areas that were unclear to me about indoor or indoor only or outdoor only or anything that it would be good to get some clarification in a future draft.

1229
02:00:16,180 --> 02:00:18,340
on the manufacturing on the main factory.

1230
02:00:18,980 --> 02:00:24,240
Yeah, we did have an error in there where we said it would be allowed on CA and A land indoor only.

1231
02:00:24,500 --> 02:00:24,600
Yeah.

1232
02:00:24,820 --> 02:00:28,360
And that is going to be changed for two reasons.

1233
02:00:28,560 --> 02:00:34,060
Number one, it's very common to have mobile units that will actually go out and visit a farm

1234
02:00:34,060 --> 02:00:36,840
and process the plants right there on site.

1235
02:00:37,500 --> 02:00:42,060
And that by definition is considered outdoor even though it's normally inside the back of the trailer.

1236
02:00:42,060 --> 02:00:50,040
And then number two, there's going to be a number of operations that would simply be working under a canopy or under some type of the shade structure.

1237
02:00:50,400 --> 02:00:52,700
So we will be amending that in the future.

1238
02:00:53,400 --> 02:00:54,100
I appreciate that.

1239
02:00:56,300 --> 02:01:01,340
Also, I see that we adopted the language about the prohibition of advertising.

1240
02:01:01,700 --> 02:01:09,580
And I think we want to limit advertising for cannabis because we're concerned about its effect on young people.

1241
02:01:09,580 --> 02:01:16,680
And I think that the balance we struck in terms of allowing commercial locations or

1242
02:01:16,680 --> 02:01:21,620
dispensaries to advertise makes a lot of sense.

1243
02:01:21,960 --> 02:01:26,600
In the manufacturing side, it seems to me that if you're in the manufacturing business

1244
02:01:26,600 --> 02:01:35,160
that you may have a need to do advertising to other cultivators or other businesses because

1245
02:01:35,160 --> 02:01:41,380
because it's more of a business-to-business transaction, and I would hope in a future iteration

1246
02:01:41,380 --> 02:01:46,540
of the manufacturing ordinance that we can look at that language to recognize that

1247
02:01:46,540 --> 02:01:54,380
kind of transaction, because I think it may be a restriction on a business that would

1248
02:01:54,380 --> 02:02:01,060
be unnecessary, because that doesn't necessarily meet our concerns that we would have generally

1249
02:02:01,060 --> 02:02:06,220
about advertising, but this is a different kind of business and it should be treated differently.

1250
02:02:06,320 --> 02:02:14,440
I agree. The last thing I'll just say is that I'm sure that you found in your five months

1251
02:02:14,920 --> 02:02:22,980
that it's hard to fit everything neatly into one box, that there are topography,

1252
02:02:25,900 --> 02:02:32,440
the situations are all just a little different and require some amount of discretion.

1253
02:02:33,140 --> 02:02:37,340
And I hope we have language in there to give you some discretion based on the circumstances

1254
02:02:37,340 --> 02:02:43,620
at a site to be able to make the best decision possible because I think that we did that in

1255
02:02:43,620 --> 02:02:47,600
our cultivation ordinance and I think that's helpful in the manufacturing ordinance because

1256
02:02:47,600 --> 02:02:52,320
you're going to be there, and there's not everything that we can conceive of up here,

1257
02:02:52,620 --> 02:02:57,640
but you'll need to have some wiggle room to be able to deal with down the line.

1258
02:02:58,320 --> 02:03:00,760
Agreed, and I will work with County Council to get that in there.

1259
02:03:01,300 --> 02:03:05,120
The other thing which I think would be helpful, I know it will be helpful for my district,

1260
02:03:05,360 --> 02:03:10,000
and my colleague can say it would be helpful for their districts, is getting some idea of

1261
02:03:10,000 --> 02:03:19,620
mapping. What I've learned in the course of developing ordinances with buffers is until

1262
02:03:19,620 --> 02:03:29,580
you actually see a map of what it actually means on a real spatial map, you can't pick

1263
02:03:29,580 --> 02:03:35,920
out a number in this one at 600 feet. But maybe that means there's no place in the first

1264
02:03:35,920 --> 02:03:41,720
district for someone to manufacture. I don't know that. I have an ad time to call GIS and

1265
02:03:41,720 --> 02:03:47,000
get mapping, but I think it would be helpful when a manufacturing ordinance comes back

1266
02:03:47,000 --> 02:03:52,660
that we have some idea of what those maps might look like. I know I would like it for

1267
02:03:52,660 --> 02:03:57,420
the first district, and I'm going to make a request to GIS, but if others care about it,

1268
02:03:57,420 --> 02:04:02,700
because if we're looking to create something to support something, we allow people to

1269
02:04:02,700 --> 02:04:08,900
grow this plan, we should make sure that we are creating some, an ordinance that gives

1270
02:04:08,900 --> 02:04:10,000
them no place to manufacture.

1271
02:04:10,820 --> 02:04:11,080
Absolutely.

1272
02:04:11,860 --> 02:04:15,160
I just think that's an important part of the development of this ordinance.

1273
02:04:16,400 --> 02:04:19,380
There are no more questions about manufacturing, I'll let you continue on.

1274
02:04:19,780 --> 02:04:20,080
Okay.

1275
02:04:20,620 --> 02:04:24,460
So we're moving to the next phase, which is the retail sale and the dispensaries.

1276
02:04:25,260 --> 02:04:32,400
The current ordinance code chapter 7.130 identified 13 dispensaries that are eligible to apply

1277
02:04:32,400 --> 02:04:38,720
for a level one dispensary license. All 13 submitted applications, staff has reviewed those

1278
02:04:38,720 --> 02:04:44,020
applications, has inspected the sites, and is currently going through the final process.

1279
02:04:44,740 --> 02:04:51,580
No licenses have been issued at this moment due to a number of outstanding compliance issues

1280
02:04:51,580 --> 02:04:57,360
with the buildings. Almost every one of the dispensaries had put up security cameras and safety

1281
02:04:57,360 --> 02:05:04,620
lights and installed security hardware, not all of those comply with our building permit

1282
02:05:04,620 --> 02:05:11,380
process and sometimes the door hardware doesn't comply with the fire safety code to allow

1283
02:05:11,380 --> 02:05:18,380
immediate or emergency exit. So we are working with the dispensaries to correct those issues.

1284
02:05:19,240 --> 02:05:25,520
Planning has designated a staff person that will assist on bringing these people into compliance

1285
02:05:25,520 --> 02:05:30,920
an assist with the permitting process, so we can expedite that, but we would like to

1286
02:05:31,440 --> 02:05:35,460
inform the board at this time that it's possible that not all 13 dispensaries will ultimately

1287
02:05:35,460 --> 02:05:36,320
receive a license.

1288
02:05:37,840 --> 02:05:42,380
But on a happy note, it's very likely that the first license will be issued within the

1289
02:05:42,380 --> 02:05:43,000
next day or two.

1290
02:05:45,260 --> 02:05:51,620
So moving on, there's been discussion about additional dispensary licenses, a Phase II registration,

1291
02:05:51,620 --> 02:05:54,560
and also discussion about veterans' access.

1292
02:05:55,540 --> 02:05:59,500
Before I dive into that, I've got some statistics I should share and

1293
02:05:59,500 --> 02:06:04,020
that may kind of reflect as to how staff is thinking.

1294
02:06:04,800 --> 02:06:09,560
But on average, California counties have one dispensary for every 84,000 residents.

1295
02:06:10,320 --> 02:06:13,580
In Santa Cruz County, we have 13 dispensaries.

1296
02:06:13,800 --> 02:06:19,320
So the ratio is one dispensary for every 18,257 residents.

1297
02:06:19,320 --> 02:06:36,680
So because of this staff doesn't really feel that there is any issue with the ability of the public to access legal cannabis products, and we do not recommend any general expansion of the cannabis dispensary license at this time.

1298
02:06:37,080 --> 02:06:47,200
That said, the board is also directed staff to report back on the Santa Cruz Veterans Alliance, and in general the veterans access to cannabis.

1299
02:06:48,400 --> 02:06:54,560
As a reminder to the public, the Veterans Alliance does operate a compassion program where they

1300
02:06:54,560 --> 02:06:57,680
donate or provide free medical cannabis to veterans.

1301
02:06:58,380 --> 02:07:07,560
However, with us right in the middle of finishing the first phase of dispensary licenses, staff

1302
02:07:07,560 --> 02:07:14,540
requests that I would return on May 23rd with all the necessary recommendations to respond

1303
02:07:14,540 --> 02:07:16,920
on to the board's concerns about the cannabis access

1304
02:07:16,920 --> 02:07:18,720
for veterans and for the veterans alliance?

1305
02:07:20,040 --> 02:07:22,020
Are there questions about dispensaries

1306
02:07:22,020 --> 02:07:23,000
of the veterans alliance?

1307
02:07:23,420 --> 02:07:25,660
No, I was gonna bring that question up

1308
02:07:25,660 --> 02:07:29,040
because you said we were gonna wait until we got into phase two

1309
02:07:29,040 --> 02:07:31,200
of this and I'm glad we're moving in that direction.

1310
02:07:31,960 --> 02:07:37,040
So would you have then the ratios then with one in 13

1311
02:07:37,040 --> 02:07:41,540
or 13 and then or 14 and I mean one might be dropped,

1312
02:07:41,640 --> 02:07:42,760
I know we're at 13 now.

1313
02:07:42,760 --> 02:07:48,820
If one's dropped, then one's available in essence, but the ratio could be pretty simple,

1314
02:07:48,900 --> 02:07:57,940
I guess, to get, but I think that was a point of discussion on our first go around about

1315
02:07:57,940 --> 02:07:59,080
the veterans alliance.

1316
02:07:59,400 --> 02:08:05,520
But I think it's something that we really directed, we were interested in that.

1317
02:08:05,640 --> 02:08:07,280
I know I am in this phase too, as well.

1318
02:08:09,100 --> 02:08:10,020
Supervisor Caput.

1319
02:08:11,740 --> 02:08:20,980
Yeah, I'm concerned also, and I'd like to see the veterans' alliance included, is

1320
02:08:20,980 --> 02:08:22,680
again, back to money.

1321
02:08:23,380 --> 02:08:28,560
If they're going to give it away, compassionate use, give away a lot of it for free.

1322
02:08:29,080 --> 02:08:32,820
That means there's no taxes, there's no tax money.

1323
02:08:33,320 --> 02:08:35,640
I don't want us to get into where the money is now.

1324
02:08:36,980 --> 02:08:44,160
if they want to give it away, how are we going to work that out?

1325
02:08:44,900 --> 02:08:49,840
Well, as I understand it, and if I misspeak, then I hope somebody from the Veterans Alliance will correct me,

1326
02:08:50,060 --> 02:08:55,920
but the Veterans Alliance donates 10% of everything that they have to the compassion program.

1327
02:08:56,180 --> 02:09:03,800
So 90% is still for profit, and they would be paying their cannabis business tax on that 90%.

1328
02:09:03,800 --> 02:09:22,320
Okay. Supervisor Coonerty. So just to, just because I think there's probably some interested folks in the crowd, maybe telegraph where we might end up, do you think that the Veterans Alliance could be included not in a phase two, but in the phase one?

1329
02:09:23,020 --> 02:09:32,620
And do you think you could do that in, you think you could bring something to us for consider by mid to late May for that action to take place?

1330
02:09:32,620 --> 02:09:38,600
I would defer to legal counsel on that because as I understand it, it would require an amendment

1331
02:09:38,600 --> 02:09:40,860
to ordinance 7.130.

1332
02:09:41,520 --> 02:09:47,240
We would prefer to not add them to Phase 1, but to come back whenever your board says,

1333
02:09:47,360 --> 02:09:51,280
meant to late May, with a Phase 2 or whatever you want to call it, that doesn't require

1334
02:09:51,280 --> 02:09:54,700
us to make major amendments to the ordinance that's already in effect.

1335
02:09:55,780 --> 02:09:56,180
Okay.

1336
02:09:56,180 --> 02:10:04,920
Yeah, I mean, I too, as no surprise to anybody, support this idea for the Santa Cruz Veterans

1337
02:10:04,920 --> 02:10:05,420
Alliance.

1338
02:10:06,060 --> 02:10:07,980
They're located in my district.

1339
02:10:08,300 --> 02:10:14,980
They've been doing some really great work with veterans making a variable of free or

1340
02:10:14,980 --> 02:10:21,500
low cost, participating in the studies with Stanford, and working with the local veterans

1341
02:10:21,500 --> 02:10:22,880
organizations quite frankly.

1342
02:10:24,700 --> 02:10:30,600
We've been talking about a phase two licensing program for nine or ten months.

1343
02:10:30,900 --> 02:10:36,280
We originally wanted this to come back in the middle of November, then we put it to December.

1344
02:10:36,860 --> 02:10:39,640
Then we put it to January, and here we are at the end of February.

1345
02:10:41,260 --> 02:10:46,640
So when it comes time to emotion, I wouldn't mind moving this up to our first meeting in April,

1346
02:10:46,640 --> 02:10:56,600
which is April 11th to have an ordinance come back because at some point we should start

1347
02:10:56,600 --> 02:11:02,980
making decisions rather than bringing it back to talk about it to make some conclusions.

1348
02:11:03,980 --> 02:11:09,700
So I'll just offer that because it seems like we've been putting this off, putting it off,

1349
02:11:09,820 --> 02:11:12,380
putting it off, and it'll be nice to get it done.

1350
02:11:12,380 --> 02:11:17,780
So other questions about the spenceries of the Veterans Alliance, then

1351
02:11:19,830 --> 02:11:20,990
we'll move on to the next category.

1352
02:11:21,150 --> 02:11:23,830
The final subject, cannabis business tax.

1353
02:11:24,710 --> 02:11:31,530
So Santa Cruz County, the voters enacted measures K and E, which establishes cannabis business tax.

1354
02:11:32,110 --> 02:11:38,790
It allows the board discretion to impose a tax up to 10% on every category of cannabis activity.

1355
02:11:38,790 --> 02:11:44,850
the cultivation, manufacturing, retail sales, transporting, packaging, whatever.

1356
02:11:45,710 --> 02:11:50,230
And then in addition to that, the Adult Use of Marijuana Act, which passed back in November,

1357
02:11:51,150 --> 02:11:55,530
imposes or will impose new taxes effective January 1st of 2018.

1358
02:11:55,870 --> 02:11:57,990
And these are fairly substantial taxes.

1359
02:11:58,650 --> 02:12:08,150
There is a state tax on cultivation, which is $9.25 an ounce on dried flowers and 275 per

1360
02:12:08,150 --> 02:12:14,750
ounce on dried leaves. There's a excise tax on retail sales that applies both the medical

1361
02:12:14,750 --> 02:12:21,150
and non-medical. That's 15% of the retail price. There's the existing state sales tax.

1362
02:12:22,110 --> 02:12:27,370
And when you add all of those up, it's over 23% right there exists for the state taxes.

1363
02:12:28,270 --> 02:12:31,290
And then you add on the local taxes on top of that.

1364
02:12:33,440 --> 02:12:35,840
The local cannabis business tax for

1365
02:12:35,840 --> 02:12:39,500
Santa Cruz County is currently set at 7% for all categories.

1366
02:12:40,140 --> 02:12:45,240
The budgeted revenues for this fiscal year, fiscal year 2016, 2017, is approximately

1367
02:12:45,240 --> 02:12:46,640
$3.2 million.

1368
02:12:47,560 --> 02:12:53,780
Our year-to-date receipts are currently, once again, rough number, $1,485,000.

1369
02:12:54,640 --> 02:13:02,020
It looks as if we're behind in getting our revenues, however, once again I would like to inform

1370
02:13:02,020 --> 02:13:07,920
From the board that the revenues are not going to be linear across the calendar year because

1371
02:13:07,920 --> 02:13:13,220
of the spikes in when the cultivators actually harvest and sell their product.

1372
02:13:13,740 --> 02:13:17,520
We miss the outdoor sale, which normally occurs in September, October.

1373
02:13:18,260 --> 02:13:23,740
So what we are expecting to see are spikes on a three-month intervals, which, which occurs

1374
02:13:23,740 --> 02:13:28,320
are reflects the three-month cycle for indoor cultivation.

1375
02:13:29,400 --> 02:13:35,620
So at this point, it's just too early to predict I don't have any baseline data or experience to go off of.

1376
02:13:38,060 --> 02:13:47,700
Going back to the state sales tax and the state excise tax, we're looking at the 23% tax minimum on the state point.

1377
02:13:48,880 --> 02:13:55,120
That is going to possibly affect how we want to address our taxes, our local taxes.

1378
02:13:55,120 --> 02:13:58,560
So there's a number of different options that the county could consider.

1379
02:13:58,760 --> 02:14:01,940
We could leave the tax as is at 7% at each category.

1380
02:14:02,780 --> 02:14:10,060
The county may want to consider dropping the tax on each category, but having it flat across,

1381
02:14:10,060 --> 02:14:13,820
so maybe a five, five and five on cultivation manufacturing dispensing.

1382
02:14:14,600 --> 02:14:17,180
We could implement a rebate program.

1383
02:14:17,400 --> 02:14:21,600
We could elect to only tax wholesale transactions.

1384
02:14:21,600 --> 02:14:41,460
We could allow, or we could consider only taxing retail sales, or we could consider a stepped or incremental approach where we start off with lower taxes to allow businesses to start up and then those taxes increase over time, all of those are different options that the county may want to consider.

1385
02:14:41,460 --> 02:14:48,440
And because of the changing nature of the state taxes with the changing effect of January

1386
02:14:48,440 --> 02:14:53,180
1st of 2018, staff has been discussing the taxing issues with a number of industry

1387
02:14:53,180 --> 02:14:59,040
stakeholders, and at this time we'd like to express thanks to those individuals who participated

1388
02:14:59,040 --> 02:14:59,980
entered in.

1389
02:15:00,000 --> 02:15:26,820
The names are listed in Attachment 3. But this group, while not speaking for the entire industry, did provide a lot of input from the industry perspective. And they were very concerned that if the taxes are too high, not only would purchasers go to the black market, but very likely it would discourage cultivators and manufacturers from coming forward and paying their taxes and getting the license as well.

1390
02:15:27,460 --> 02:15:37,360
Well, and while staff appreciates and understands that perspective, we're a little bit of a disagreement

1391
02:15:37,360 --> 02:15:43,880
here, I would point out that once again as we discussed, only 39 new businesses have elected

1392
02:15:43,880 --> 02:15:49,940
to register to pay their cannabis business tax, even though we have 760 cultivation applicants.

1393
02:15:50,780 --> 02:15:57,620
We feel that there's going to be a period of time that will expire before these people

1394
02:15:57,620 --> 02:15:59,280
come forward and start paying their taxes.

1395
02:16:00,340 --> 02:16:04,580
That's why as we discussed earlier, we would like to send out letters to all of the prospective

1396
02:16:04,580 --> 02:16:09,140
cultivators, to all those applicants and let them know that there's a deadline of June 30

1397
02:16:09,140 --> 02:16:10,080
of the 2017.

1398
02:16:10,780 --> 02:16:15,140
They have to register to pay their cannabis business tax by that time, otherwise they

1399
02:16:15,140 --> 02:16:18,520
may be considered as non-eligible to receive their license ultimately.

1400
02:16:19,520 --> 02:16:25,640
And then we would also then propose that we come back before the board sometime late summer

1401
02:16:25,640 --> 02:16:32,700
perhaps in August and discuss what our actual revenues were from the cannabis business

1402
02:16:32,700 --> 02:16:38,460
tax from this current fiscal year and then once again review the options moving forward as

1403
02:16:38,460 --> 02:16:43,520
to how the county may or may not want to react to the new state taxes that go into effect

1404
02:16:43,520 --> 02:16:44,920
on January 1st to 2018.

1405
02:16:47,500 --> 02:16:48,200
Supervisor McGee.

1406
02:16:48,200 --> 02:16:53,340
This is one of the most complicated parts of this whole thing I think because I think

1407
02:16:53,340 --> 02:16:58,700
that from what I've heard that Colorado, Washington, Oregon, once you get over the 25% threshold

1408
02:16:58,700 --> 02:17:11,840
or something, the number that goes in the black market. I hope is that we can get as many

1409
02:17:11,840 --> 02:17:17,120
Many people participate in the tax structure, shall we say, from the get-go because I think

1410
02:17:17,120 --> 02:17:24,100
once we freeze them out or just make them run away from this because of the taxes, I would

1411
02:17:24,100 --> 02:17:25,700
rather have them in the system somehow.

1412
02:17:26,480 --> 02:17:32,540
That could have an impact on our revenue or income, I know, and it's going to be one of

1413
02:17:32,540 --> 02:17:38,020
the biggest decisions we have that how do we do this to really have people participate

1414
02:17:38,020 --> 02:17:43,180
Because I think if we get over a certain threshold, it's going to be those kinds of numbers

1415
02:17:43,180 --> 02:17:46,320
that you've already released about the numbers we're participating.

1416
02:17:47,160 --> 02:17:48,800
That's just a huge concern of mine.

1417
02:17:49,040 --> 02:17:50,460
I know we're going to have to look at it.

1418
02:17:50,480 --> 02:17:53,980
We're going to talk about it a long time, or not too long a time.

1419
02:17:53,980 --> 02:17:55,120
We've got to implement it.

1420
02:17:55,260 --> 02:17:59,680
And one of the things is this 15 percent exercise section of the state, very little

1421
02:17:59,680 --> 02:18:03,940
if any really comes back to local government who's going to have to really be the ones

1422
02:18:03,940 --> 02:18:06,420
that are overseeing this process directly.

1423
02:18:06,420 --> 02:18:16,720
So that's disturbing. I'd really like to call the state to say why don't you just do it at 5% and let us go for the other 10 or something, but I don't think that's going to happen.

1424
02:18:17,360 --> 02:18:30,420
So anyway, it's just a concern of mine that I think we have to weigh and have to get real about what we can anticipate, whatever the figure is, we decide on.

1425
02:18:30,420 --> 02:18:35,840
What is the going to be the revenue structure because we already have some folks out there that are looking to this

1426
02:18:35,840 --> 02:18:42,980
Vananza of revenue coming into the county and how how we can just spend it because our pockets are full and I don't know that

1427
02:18:42,980 --> 02:18:45,100
We can really count on that kind of a

1428
02:18:45,960 --> 02:18:50,320
An outcome. It's just going to be a real careful decision that we have to make but

1429
02:18:51,260 --> 02:18:53,000
I wish we could get the state to

1430
02:18:53,680 --> 02:18:54,860
kind of ease its

1431
02:18:54,860 --> 02:19:00,400
It's 15% but it's not going to do it, so we just have to act accordingly.

1432
02:19:04,560 --> 02:19:05,380
Supervisor Secretary.

1433
02:19:06,740 --> 02:19:10,300
So, and I agree that this is one of the more complicated areas.

1434
02:19:11,140 --> 02:19:17,680
My question first is, Monterey County was looking at estimated cannabis revenues of $30 million

1435
02:19:19,780 --> 02:19:21,500
in their budgets.

1436
02:19:22,240 --> 02:19:26,740
Is it reasonable to think that we're a smaller county, but not significantly different,

1437
02:19:26,740 --> 02:19:29,560
that we could have annual revenues in excess of $10 million.

1438
02:19:37,010 --> 02:19:44,810
Unfortunately, I didn't bring those numbers with me, but personally, I do not think that it's unreasonable for us to anticipate those types of revenues.

1439
02:19:46,150 --> 02:19:56,890
From the information has been provided to me and hasn't been vetted, we are looking at the dispensaries do $35 million worth of business a year.

1440
02:19:59,210 --> 02:20:04,350
The cultivators may be doing $70 to $80 million per year.

1441
02:20:04,470 --> 02:20:05,270
We're not really sure.

1442
02:20:05,450 --> 02:20:06,690
We'll have a much better idea once

1443
02:20:06,690 --> 02:20:08,630
for through the registration and licensing process.

1444
02:20:09,610 --> 02:20:13,110
The manufacturing is a really unknown,

1445
02:20:13,290 --> 02:20:14,710
and there's a very wide range.

1446
02:20:14,910 --> 02:20:18,110
The absolute lowest limit is $15 million per year

1447
02:20:18,110 --> 02:20:19,570
of gross receipts on manufacturing.

1448
02:20:20,330 --> 02:20:24,150
But I've had folks in the industry tell me

1449
02:20:24,150 --> 02:20:27,730
that the real estimate is somewhere between $40 and $70 million per year.

1450
02:20:28,430 --> 02:20:33,710
So when you add all of those together, you're looking at something that's between $177 million

1451
02:20:33,710 --> 02:20:37,790
and $225 million or $250 million per year.

1452
02:20:37,970 --> 02:20:39,710
This is a major industry.

1453
02:20:40,430 --> 02:20:48,710
And if we are successful in getting the members of the cannabis businesses to become licensed

1454
02:20:48,710 --> 02:20:53,470
to pay the taxes, then yes, absolutely, those are reasonable estimates.

1455
02:20:54,110 --> 02:21:00,210
And then my second question, it's a question slash comment, which is, I agree that the

1456
02:21:00,210 --> 02:21:06,370
7 plus 7 plus 7 plus 15 plus sales tax gets to a place where you're overtaxing.

1457
02:21:06,810 --> 02:21:11,710
But I'm curious as to how much of that is actually going to occur, because from what I understand,

1458
02:21:12,290 --> 02:21:17,250
90% of the cannabis grown is exported, so that would only be taxed once.

1459
02:21:17,250 --> 02:21:23,070
plus we're giving cannabis growers the chance to manufacture to some extent.

1460
02:21:23,450 --> 02:21:25,650
So that would be just taxed once, seven percent.

1461
02:21:26,370 --> 02:21:32,870
We're giving potentially some of the dispensaries the chance to cultivate.

1462
02:21:33,770 --> 02:21:35,650
So that would just be taxed once.

1463
02:21:36,910 --> 02:21:38,230
So I'm trying to get it.

1464
02:21:38,450 --> 02:21:44,350
How are we getting to two or three percent of potential cannabis sales?

1465
02:21:44,350 --> 02:21:50,230
that, and then some cannabis is not manufactured, it's just grown and then sold.

1466
02:21:50,670 --> 02:21:56,110
So, are we talking about 2% of the potential market that's actually being taxed at this,

1467
02:21:56,390 --> 02:21:58,430
potentially taxed at this 21% rate?

1468
02:21:59,810 --> 02:22:03,750
So, I'm going to, unfortunately, have to go into a bit of detail to answer your question.

1469
02:22:04,070 --> 02:22:04,110
Sure.

1470
02:22:04,790 --> 02:22:09,990
Starting off with the fact that, yes, from what I've been told, that probably 90% of the cannabis

1471
02:22:09,990 --> 02:22:13,770
was cultivated in Santa Cruz County as exported to other parts of the state.

1472
02:22:14,430 --> 02:22:19,810
And perhaps 85% to 90% of the manufactured products are actually exported out of the county.

1473
02:22:20,610 --> 02:22:22,790
So they would only be paying the 7% once.

1474
02:22:23,390 --> 02:22:29,150
The question becomes for us is that 7% competitive with other counties,

1475
02:22:30,050 --> 02:22:36,910
or would we then be encouraging people to not necessarily report everything that they've done,

1476
02:22:36,910 --> 02:22:44,730
or not register whatsoever, on the part, on the portion that's actually sold here in Santa Cruz County.

1477
02:22:45,230 --> 02:22:53,690
Roughly, from what I've been told, roughly 40% of the sales are from manufactured products and the remaining 60% is on the actual buds.

1478
02:22:54,090 --> 02:23:02,150
And most people project that ratio will change with more and more of the manufactured products being purchased.

1479
02:23:02,970 --> 02:23:10,050
So, a good number, 40% of what's sold in the dispensaries is actually going to be hit with the 7-7-7,

1480
02:23:10,290 --> 02:23:15,990
unless the dispensary is also the cultivator.

1481
02:23:16,490 --> 02:23:20,110
From what I've been told in order to supply a dispensary,

1482
02:23:20,710 --> 02:23:24,410
it probably takes 10 cultivators for everyone dispensary,

1483
02:23:24,550 --> 02:23:28,650
simply because your harvesting is going to hit at different periods of the year,

1484
02:23:28,650 --> 02:23:33,570
And once again that three month cycle, different growers specialize in different strains.

1485
02:23:34,290 --> 02:23:39,310
And normally when you go into dispensary you will see an array of maybe 15 or 20 different

1486
02:23:39,310 --> 02:23:41,790
types of product up there, different buds.

1487
02:23:42,750 --> 02:23:51,330
And then finally if something happens, if somebody gets hit with mold or mildew or mites,

1488
02:23:51,410 --> 02:23:55,130
somebody could lose an entire crop and the dispensary can't afford that.

1489
02:23:55,130 --> 02:23:58,950
So, that's why they have to have a minimum of 10 different cultivators applying them.

1490
02:23:59,370 --> 02:24:06,770
The bottom line is, at the dispensary 40% of those products sold would see that 777 hit.

1491
02:24:07,870 --> 02:24:15,310
The other 60% could range anywhere from 7% to 14% to paying upon whether the dispensary

1492
02:24:15,310 --> 02:24:17,030
owner was also the cultivator or not.

1493
02:24:17,410 --> 02:24:24,850
But when you also have cultivators who are manufacturers, so in that 40% not all that-

1494
02:24:24,850 --> 02:24:25,310
That is true.

1495
02:24:25,530 --> 02:24:26,130
That would be taxed.

1496
02:24:26,130 --> 02:24:27,110
That is true, right as well.

1497
02:24:28,410 --> 02:24:28,650
Okay.

1498
02:24:29,270 --> 02:24:29,710
Yeah.

1499
02:24:29,810 --> 02:24:36,670
I mean, I'm going to have a series of questions, I think, to prepare realities we don't really know a lot right now.

1500
02:24:38,150 --> 02:24:44,710
And if we come back in August along the series of questions that I'd like to see in order to better inform this discussion.

1501
02:24:45,290 --> 02:24:45,550
Very good.

1502
02:24:46,850 --> 02:24:54,050
If I could just also, and we also have the changing landscape at the federal level in terms of the tax structure

1503
02:24:54,050 --> 02:24:59,370
structure in the role of the counties in cannabis cultivation, and that's going to add

1504
02:24:59,370 --> 02:25:03,370
another level of uncertainty. But I think you're right, there's a lot we don't know.

1505
02:25:06,710 --> 02:25:12,410
Mr. Peterson, I wonder if you could share with us what you know about the research about

1506
02:25:13,790 --> 02:25:14,990
taxing this product.

1507
02:25:15,990 --> 02:25:19,470
Well, there's been a considerable amount of research, and of course it's focused around

1508
02:25:19,470 --> 02:25:25,570
Colorado, Washington and Oregon, and a great deal the research had to do with at what

1509
02:25:25,570 --> 02:25:35,490
point do regulations and taxes that cause an increase in prices affect the black market

1510
02:25:35,490 --> 02:25:37,730
and the effect the sales and the revenues.

1511
02:25:38,270 --> 02:25:42,870
There's something called an elasticity of demand, which is a business term that I just learned

1512
02:25:42,870 --> 02:25:49,130
recently, and basically what it means is that as you raise the price of a commodity, then

1513
02:25:49,130 --> 02:25:51,750
And as certain, the demand will go down.

1514
02:25:52,190 --> 02:25:55,010
And what that ratio is varies according to the product.

1515
02:25:55,730 --> 02:25:59,310
And then in the case of cannabis, it's not only will the demand go down if it gets too

1516
02:25:59,310 --> 02:26:04,970
expensive, but also will it drive people to the black market because there is an available

1517
02:26:04,970 --> 02:26:07,150
source out there for black market cannabis.

1518
02:26:08,390 --> 02:26:16,470
Early studies from 2010 through 2013 had a fairly low elasticity of demand, which meant

1519
02:26:16,470 --> 02:26:21,390
that raising the price really wasn't going to affect sales much. However, the latest study

1520
02:26:21,390 --> 02:26:27,750
from 2015, and that was a study was commissioned by the state of Colorado, came up with an

1521
02:26:27,750 --> 02:26:33,030
elasticity of demand of negative 3.4. And what that means is, for every increase in price

1522
02:26:33,030 --> 02:26:40,870
of 10%, your sales at a dispensary will go down 34%. That's an enormous elasticity of demand

1523
02:26:40,870 --> 02:26:46,470
factor for cannabis, and once again what the authors concluded was it was because

1524
02:26:46,470 --> 02:26:47,870
of the availability of the black market.

1525
02:26:49,530 --> 02:26:52,770
Well, that's, I think that that's interesting.

1526
02:26:53,370 --> 02:26:56,370
You know, I'm not sure if everybody got the elasticity of demand.

1527
02:26:56,750 --> 02:27:05,850
The former economic student understood it, but the idea that as we put the price up,

1528
02:27:05,970 --> 02:27:07,610
people will go to other sources.

1529
02:27:07,610 --> 02:27:12,470
I mean, I think from a policy perspective, what we've been trying to do, at least in my

1530
02:27:12,470 --> 02:27:18,870
mind, is work collaboratively with this group, right, whether they be dispensary owners,

1531
02:27:19,230 --> 02:27:26,770
cultivators, the general public, to come up with a reasonable set of regulations that achieve

1532
02:27:26,770 --> 02:27:31,790
our policy goals, right, protect the environment, protect the neighborhoods, and ensure access.

1533
02:27:31,790 --> 02:27:43,710
And at least in my opinion, I found that better that when we work with people, we get a lot more done than when we try to just make them do what we want.

1534
02:27:45,070 --> 02:27:59,530
And so when I hear something like a negative 3.4 elasticity of demand in a state of Colorado study, the state that had legalized recreational cannabis the longest.

1535
02:27:59,530 --> 02:28:03,550
so they have the best data that we could take a look at.

1536
02:28:04,090 --> 02:28:09,190
I think it should give us pause about the casualness in which we set rates

1537
02:28:11,050 --> 02:28:16,390
and our efforts, we really are looking at two pieces, right?

1538
02:28:16,450 --> 02:28:21,750
We're looking at the next nine to ten months, and then we're looking after January 1st, right?

1539
02:28:21,750 --> 02:28:36,370
So I would argue that we have an institutional interest to get people into the system and benefit from the volume of sales that you mentioned.

1540
02:28:36,570 --> 02:28:47,490
When you look at a $200 to $250 million group of sales, we don't need the high tax rate if we can tap a lot of that.

1541
02:28:47,490 --> 02:28:57,430
And what we've heard from the cannabis community for years is legalize it, regulate it,

1542
02:28:57,650 --> 02:28:58,230
tax it.

1543
02:28:59,710 --> 02:29:02,170
So, that's what we're trying to do.

1544
02:29:02,870 --> 02:29:12,850
But we shouldn't perceive to be in a green rush to try to just generate as much money as possible

1545
02:29:12,850 --> 02:29:19,390
because as the research shows that you could push it too far and then you drive people the other way

1546
02:29:19,390 --> 02:29:23,970
and that creates a lot more problems for us because if people choose to go to the black market

1547
02:29:24,690 --> 02:29:31,350
then we have to spend enforcement resources, more enforcement resources trying to capture those

1548
02:29:31,350 --> 02:29:38,070
folks, stop those operations and not benefit from the tax sales. I'd rather have legalized cultivators

1549
02:29:38,070 --> 02:29:43,730
paying taxes and adding to the general fund. I think that should be our policy goal.

1550
02:29:44,950 --> 02:29:51,870
The choices that we have here are in some ways interesting, but in some ways not realistic

1551
02:29:51,870 --> 02:29:58,070
as choices, because there isn't enough information, right? I mean, it's, you know, we've had this

1552
02:29:58,070 --> 02:29:59,850
We're both tax fasts.

1553
02:30:00,000 --> 02:30:29,980
Since the beginning of November, and a local tax rebate program might be a great program, but there's no meaningful information in this report that would tell us how you would do that, what it would mean, what kind of revenue might be generated from it. So, I could come up with three other ways in which the exact same amount of information is here. So, we've recently received a letter from a number

1554
02:30:29,980 --> 02:30:36,020
number of cultivators and dispensary operators asking for a modest decrease.

1555
02:30:36,400 --> 02:30:41,900
I would declare modest of lowering everything down to 5 percent.

1556
02:30:42,500 --> 02:30:47,180
And I think that, I would just say, I think that's in our interest to try to work with

1557
02:30:47,180 --> 02:30:55,300
them to help make that happen and use our partners in the cannabis community to help us bring

1558
02:30:55,300 --> 02:30:59,700
people into the system rather than trying to figure out a way in which, if you don't

1559
02:30:59,700 --> 02:31:06,260
or do it by June 30th, there's a consequence, and then we're going to be playing whack-a-mole

1560
02:31:06,260 --> 02:31:10,880
like we've done in the past, and I don't think that achieves our policy goals.

1561
02:31:11,460 --> 02:31:20,520
So I think I'm similar to where Supervisor McPherson was, and when I'd be interested

1562
02:31:20,520 --> 02:31:23,240
to take a look at that research for the State of Colorado, because I think that should

1563
02:31:23,240 --> 02:31:25,960
tell us something about what we're doing here in California.

1564
02:31:28,000 --> 02:31:34,420
So, is there any other pieces? Any other questions? People had? Well, now we're going to open

1565
02:31:34,420 --> 02:31:41,900
up to members of the public, then. Thank you, Mr. Peterson. Thank you. And we have a lot

1566
02:31:41,900 --> 02:31:47,300
of things on our agenda today. I know there's a lot of interest in this. So, be helpful to see

1567
02:31:47,300 --> 02:31:51,600
how many people want to testify today. Could I see a show of hands?

1568
02:31:56,470 --> 02:31:57,850
I'm going to give you two minutes

1569
02:31:58,710 --> 02:32:00,730
and the hopes that we could hear from everybody.

1570
02:32:01,590 --> 02:32:02,630
So two minutes.

1571
02:32:05,620 --> 02:32:06,300
Good morning.

1572
02:32:06,580 --> 02:32:06,800
Good morning.

1573
02:32:06,900 --> 02:32:09,840
Morning to the board and to Santa Cruz County residents.

1574
02:32:10,500 --> 02:32:12,560
I want to be able to say that this is good policy.

1575
02:32:12,880 --> 02:32:16,440
These are critical services that are needed for the American public.

1576
02:32:17,100 --> 02:32:19,160
And I want to be able to say your report was really nice

1577
02:32:19,160 --> 02:32:23,540
and the way you gracefully presented it was very really welcoming.

1578
02:32:23,780 --> 02:32:26,100
And I want to be able to thank you for your leadership.

1579
02:32:26,100 --> 02:32:29,200
You know, I have a charismatic can.

1580
02:32:29,480 --> 02:32:31,720
I don't know if members of the public can see that, right?

1581
02:32:31,880 --> 02:32:34,440
And I do suffer from PTSD, right?

1582
02:32:34,760 --> 02:32:38,240
As a member of the public, sometimes my economic structure is a little difficult.

1583
02:32:38,780 --> 02:32:47,440
So being on the medical cannabis, getting the car going to the doctors doing all that stuff is very difficult.

1584
02:32:48,140 --> 02:32:55,680
But being able to enjoy the decompressing recreational use of cannabis will help.

1585
02:32:56,480 --> 02:33:01,100
So being able to regulate and make it friendly in Santa Cruz County, I think it's a good thing.

1586
02:33:01,600 --> 02:33:06,780
And then also having a wheat festival where we bring people from the public to come and

1587
02:33:06,780 --> 02:33:10,960
participate so that it has a good reputation, I think it would be important.

1588
02:33:11,180 --> 02:33:11,480
Thank you.

1589
02:33:11,740 --> 02:33:13,980
But I want to ask the board to support this.

1590
02:33:14,440 --> 02:33:14,680
Thank you.

1591
02:33:16,930 --> 02:33:17,550
Good morning.

1592
02:33:17,870 --> 02:33:18,550
Good morning board.

1593
02:33:19,090 --> 02:33:20,570
My name is Colleo Mitalo-Keele.

1594
02:33:20,890 --> 02:33:24,770
I am a director for the County People's Collective as well as a board member for the ASC.

1595
02:33:25,350 --> 02:33:26,470
I'm going to read you what I've written here.

1596
02:33:26,470 --> 02:33:33,110
I would like to thank each of the supervisors and the county staff for the years of sincere efforts to create sensible regulations for cannabis,

1597
02:33:33,590 --> 02:33:35,710
perhaps at times this recognition has been lost.

1598
02:33:36,470 --> 02:33:39,850
And instead viewed as an entitlement which is not the case.

1599
02:33:40,350 --> 02:33:46,870
The resources the county has dedicated to cannabis is staggering and remains a testament to the commitments and values of our board and our community.

1600
02:33:47,070 --> 02:33:47,450
So thank you.

1601
02:33:48,370 --> 02:33:49,990
Today I'd like to focus on taxes.

1602
02:33:49,990 --> 02:33:58,290
The tax issues have been discussed over dozens of hours during the last several meetings between the licensing manager at the CAO's office and community members, including myself.

1603
02:33:58,770 --> 02:34:05,390
My takeaway is that the industry is overburdened with the tax rate that is severely reducing the revenue potential for the county.

1604
02:34:06,090 --> 02:34:17,750
The spend trees continue to shoulder the tax burden while producers and manufacturers remain reluctant to step forward simply for the hope of receiving a license, while paying a tax rate two to three times the rate since surrounding counties.

1605
02:34:17,750 --> 02:34:18,590
That is an issue.

1606
02:34:19,570 --> 02:34:24,470
Measuring requires all cannabis businesses to pay taxes, yet few are at this point in time.

1607
02:34:25,030 --> 02:34:32,030
There are thriving businesses who need incentive to participate, so let's not drive them away after years of innovation and persistence towards compliance.

1608
02:34:32,750 --> 02:34:37,770
The beauty of this is that the county and the industry's objective are symbiotic in nature.

1609
02:34:38,390 --> 02:34:44,590
We can cast the wide network cultivators and manufacturers by lowering their specific tax rates to only 2.5%.

1610
02:34:44,590 --> 02:34:51,130
Samultaneously, give dispensaries a break down from 7% to 5% for being good partners with

1611
02:34:51,130 --> 02:34:56,110
the county for many years now, having low impact on the county resources and faithfully

1612
02:34:56,110 --> 02:34:59,410
paying overestimated tax revenues for the last several years.

1613
02:35:00,390 --> 02:35:03,770
Do this and watch the revenues skyrocket overnight.

1614
02:35:05,290 --> 02:35:11,410
To clarify some statements made earlier today, the county is only behind on the CBT this year

1615
02:35:11,410 --> 02:35:13,910
due to the deficit from non-retail businesses.

1616
02:35:14,510 --> 02:35:19,030
Retailers, however, continued to pay close to 300% of what was originally advertised on the ballot.

1617
02:35:20,230 --> 02:35:24,730
There's a rude awakening coming with this 15% tax in 2018.

1618
02:35:25,370 --> 02:35:26,890
That's not the knife at, thank you.

1619
02:35:27,030 --> 02:35:27,230
Thank you.

1620
02:35:32,630 --> 02:35:33,510
Good morning.

1621
02:35:34,250 --> 02:35:35,330
Still this morning.

1622
02:35:36,510 --> 02:35:37,350
Thank you.

1623
02:35:40,510 --> 02:35:49,730
There are eight action items that you gentlemen are supposed to act on today on this item on the agenda.

1624
02:35:50,550 --> 02:35:58,310
There's no two minutes, two hours, we couldn't address all the various issues that you're faced.

1625
02:35:59,110 --> 02:36:06,990
And so, what I want to address is the process that gets you to solve these issues.

1626
02:36:06,990 --> 02:36:16,150
And the process that has gone on so far has been fits and starts and then public meetings

1627
02:36:16,150 --> 02:36:23,410
where you are faced with a line of people giving your two-minute input when what you need

1628
02:36:23,410 --> 02:36:35,370
is real data, you know, some real sophisticated analysis, I mean this tax issue is a perfect

1629
02:36:35,370 --> 02:36:45,230
For example, I mean the permutations are endless and you could with the data that is available

1630
02:36:45,230 --> 02:36:51,170
which, you know, there is no data, really.

1631
02:36:51,550 --> 02:36:56,750
You know, one point, one data point is what we've seen is what the dispensaries sell.

1632
02:36:56,970 --> 02:36:57,410
That's it.

1633
02:36:59,570 --> 02:37:06,690
And I would like to see the board get back to getting more people involved in this process.

1634
02:37:07,230 --> 02:37:12,410
And I think that that's the only way that you're going to be able to have the information

1635
02:37:12,410 --> 02:37:14,350
that you need to come to good decisions.

1636
02:37:14,870 --> 02:37:18,770
So I'd ask you to come up with one more policy objective.

1637
02:37:18,990 --> 02:37:25,450
You've got your three. I'd like to see the board recognize that the cannabis industry

1638
02:37:25,450 --> 02:37:36,090
is a valuable part of this community and partner with them to create a sustainable, productive,

1639
02:37:36,430 --> 02:37:40,250
new industry in the county that benefits all of us. Thank you.

1640
02:37:40,370 --> 02:37:40,470
Thank you.

1641
02:37:44,860 --> 02:37:47,760
Good morning. Jump right in. My name is Jeff Nordall.

1642
02:37:48,180 --> 02:37:54,100
I want to specifically address manufacturing. I did read the draft proposal.

1643
02:37:54,100 --> 02:38:22,620
and this is just a not a great but a constructive feedback on manufacturing and what I'd like to potentially propose is there's all different levels of manufacturing but a lot of them including some processes that I'm involved with involve nothing more than a crock pot, a blender, a juice machine and some spatulas and they require just

1644
02:38:22,620 --> 02:38:34,000
maybe 10 feet by 12 feet of space and so as far as requiring that type of

1645
02:38:34,000 --> 02:38:40,460
processing for especially for edible type products or body products like

1646
02:38:40,460 --> 02:38:48,040
salves and such, the requirement to house those in commercial zones seems

1647
02:38:48,040 --> 02:38:54,360
excessive and what else it would be very limiting to people trying to do start-up

1648
02:38:54,360 --> 02:38:59,240
businesses with this type of manufacturing. To give an example of another

1649
02:38:59,240 --> 02:39:07,040
industry that's operating in Santa Cruz, small family vineyards, I did a number

1650
02:39:07,040 --> 02:39:15,600
of parcel research lookups on GIS and it turns out a lot of these vineyards can

1651
02:39:15,600 --> 02:39:23,060
can cultivate harvest, crush the grapes, store the wine on site, then bottle it and actually

1652
02:39:23,060 --> 02:39:30,480
have tasting rooms all on rural ag or special use with no special site designation plan.

1653
02:39:30,780 --> 02:39:37,820
So hopefully we can follow that model for this very simple and I would call it non-solvent

1654
02:39:38,120 --> 02:39:42,980
or solvent free manufacturing where it's basically cannabis, food and body products.

1655
02:39:43,460 --> 02:39:44,100
Thank you.

1656
02:39:48,710 --> 02:39:51,750
Again, I'm Mark Rio from Larkin Valley.

1657
02:39:53,670 --> 02:39:56,050
Two things, I believe two things.

1658
02:39:56,450 --> 02:40:00,950
Yesterday, I attended the forum regarding the Environmental Impact Report.

1659
02:40:01,630 --> 02:40:05,070
It's my understanding that an environmental impact report,

1660
02:40:05,070 --> 02:40:09,590
according to CEQA, has a requirement to give alternative,

1661
02:40:10,050 --> 02:40:17,610
an alternative or alternatives to what the proposed or the direction is of the environmental impact report.

1662
02:40:17,610 --> 02:40:32,690
There was one, there was one for a more permissive alternative to the proposed report, but there was not one regarding an alternative proposal, which was more restrictive.

1663
02:40:33,270 --> 02:40:47,590
I'll point out that when I looked at both of the maps of the county, the majority of the area of the unincorporated portions of the county showed zones that would be permissible.

1664
02:40:47,590 --> 02:40:54,490
or cultivation of marijuana. The second thing I have to say is that I was told by one

1665
02:40:54,490 --> 02:41:02,810
of the employees of Mr. Peterson's department, and I have not had an opportunity to speak

1666
02:41:02,810 --> 02:41:10,670
with him directly, but I was told that the process for licensing would be ministerial after

1667
02:41:10,670 --> 02:41:19,530
the ordinance was passed and that in all likelihood Thao's ministerial approval parts would

1668
02:41:19,530 --> 02:41:23,210
be rushed through to get to the deadline before the end of the year.

1669
02:41:23,890 --> 02:41:26,790
I'll point out that this is a drug weed.

1670
02:41:27,210 --> 02:41:32,610
This is not just a structure that falls within the purview of normal permitting process of

1671
02:41:32,610 --> 02:41:34,190
the planning department.

1672
02:41:34,190 --> 02:41:44,370
During the registration process, there was no provision for public hearing for possible registration per parcel.

1673
02:41:44,930 --> 02:41:53,490
I think it is part of the due process, it's necessary, for a public hearing for each parcel for licensing.

1674
02:41:54,090 --> 02:41:54,510
Thank you.

1675
02:41:57,820 --> 02:41:58,600
Good afternoon.

1676
02:41:58,960 --> 02:42:01,280
Good morning, good afternoon, and good night knowing.

1677
02:42:02,220 --> 02:42:06,260
I just wanted to thank everybody really quick so I can get through all my points.

1678
02:42:06,260 --> 02:42:11,560
Thank you to every single person in here and all your staff, because quite simply we're

1679
02:42:11,560 --> 02:42:16,180
blessed to be in Santa Cruz and to have such a great county to work with.

1680
02:42:16,720 --> 02:42:19,380
So with that said, I'm going to try and get through everything.

1681
02:42:19,540 --> 02:42:27,720
I think what my main concern here is who's going to be most at risk from this 7% tax as it is right now

1682
02:42:27,720 --> 02:42:33,520
for the next nine months. And let's put aside the composite 21% for a minute.

1683
02:42:33,520 --> 02:42:40,060
7% as it translates is the highest tax bracket in the state.

1684
02:42:40,480 --> 02:42:47,100
So who you're affecting right now in Santa Cruz County are small, local, family-run businesses

1685
02:42:47,100 --> 02:42:48,000
like myself.

1686
02:42:48,960 --> 02:42:53,220
And we have to compete in the state market, that's just a fact.

1687
02:42:54,000 --> 02:43:01,600
So right now we, especially manufacturers, we don't have the luxury of setting our rates,

1688
02:43:01,900 --> 02:43:02,740
it goes by state.

1689
02:43:02,740 --> 02:43:07,780
So, we're consuming the tax rate right now, which is on the highest tax bracket.

1690
02:43:07,980 --> 02:43:12,240
So, what we're just requesting right now is to be in that middle tax bracket.

1691
02:43:12,720 --> 02:43:19,220
So, to help give our small local family businesses the chance to survive the changing current.

1692
02:43:19,940 --> 02:43:29,620
So, with that said, we didn't add on January 1st, the 9-11% grocery seats that is going to be added to cultivators.

1693
02:43:29,620 --> 02:43:38,300
That was translated based on, again, it was 2016 benchmark pricing on price per pound

1694
02:43:38,300 --> 02:43:43,720
and trim, and I calculated that with Kirsten Nevedal, who is one of the experts on the state

1695
02:43:43,720 --> 02:43:49,400
and local levels on dealing with taxes, so it wasn't just pulled out of the air.

1696
02:43:49,980 --> 02:43:59,260
The rebate, we went over that with staff, and unfortunately a rebate would not give the

1697
02:43:59,260 --> 02:44:01,940
end user, the patients that rebate.

1698
02:44:02,280 --> 02:44:04,320
And so it wouldn't lower prices on the patient level.

1699
02:44:04,480 --> 02:44:05,940
And so that was a big concern for us.

1700
02:44:06,400 --> 02:44:07,120
Thank you so much.

1701
02:44:09,840 --> 02:44:10,500
Good afternoon.

1702
02:44:12,520 --> 02:44:15,680
Good afternoon, Chair, Vice Chair, members of the board,

1703
02:44:16,360 --> 02:44:16,860
county staff.

1704
02:44:17,520 --> 02:44:18,680
My name is Jason Sweat.

1705
02:44:18,780 --> 02:44:21,260
I'm director and co-founder of Santa Cruz Veterans Alliance.

1706
02:44:22,180 --> 02:44:25,020
Since we've stood here before you last June,

1707
02:44:25,900 --> 02:44:28,460
we've made, we've done a lot of things.

1708
02:44:28,460 --> 02:44:38,220
We've, you know, concluded a study with the Veterans Administration and Stanford University on the effects of cannabis with PTSD, TBI, and sleep.

1709
02:44:38,840 --> 02:44:44,500
We're waiting to hear those results back that are being published as we move forward throughout the year.

1710
02:44:45,780 --> 02:44:54,520
We've also donated, you know, through our toy drive that we do every year, you know, to the Veterans community back in December.

1711
02:44:54,520 --> 02:44:59,980
We held the lease of Tukach held the Operation Lover Vats and everything where we provided toys for.

1712
02:45:00,000 --> 02:45:16,160
Or the members of the community. So I highly, I respectfully request that this board allows us to continue our mission throughout the year and into the future. Thank you.

1713
02:45:24,620 --> 02:45:37,920
It's great honor to be here before the Board of Supervisors. And I'm Albert Brett. I'm a Vietnam veteran. I'm an Idaho resident. I've lived here since October 15 as a medical

1714
02:45:37,920 --> 02:45:38,600
Sojourner.

1715
02:45:38,920 --> 02:45:43,340
And in Idaho, I'm a criminal, I have a war now for my arrest, I've been fighting my

1716
02:45:43,340 --> 02:45:50,740
pancreatic cancer with high quantities of cannabis, full spectrum, and I take it as

1717
02:45:50,740 --> 02:45:51,080
an oil.

1718
02:45:52,020 --> 02:46:00,200
I'm currently getting it through the veteran's alliance here, Jason, and I'd be lost

1719
02:46:00,200 --> 02:46:00,780
without it.

1720
02:46:01,160 --> 02:46:02,080
I wouldn't be lost.

1721
02:46:02,280 --> 02:46:05,360
I would be, I have endocrine pancreatic cancer.

1722
02:46:05,360 --> 02:46:12,200
It was taken out of me on June of 2014, that I've gone for cat scans.

1723
02:46:12,380 --> 02:46:16,820
I am currently, there's no evidence of my, of that disease in my body.

1724
02:46:17,340 --> 02:46:18,900
However, it's been taken out of me.

1725
02:46:19,060 --> 02:46:21,260
It's the very one that got Steve Jobs.

1726
02:46:22,620 --> 02:46:24,760
I don't have the money for a new pancreas.

1727
02:46:26,000 --> 02:46:27,580
He was able to afford when it did work.

1728
02:46:28,640 --> 02:46:35,020
But the cannabis is stopping the gene progression of that of the replicating cells.

1729
02:46:35,020 --> 02:46:47,740
Now, you know, I wish I was before, I wish I was standing before our United States Senate and I asked for the scheduled one to be taken off.

1730
02:46:48,280 --> 02:46:55,900
I need my medicine. I'm getting it. I'm a member of WAM. WAM wants $1,500 a month for my medicine.

1731
02:46:55,900 --> 02:47:03,340
I'm able to procure it with assistance through Jason and his end to go.

1732
02:47:04,080 --> 02:47:10,180
Anyway, please, please allow these men to give us our medicine.

1733
02:47:10,660 --> 02:47:11,420
Thank you.

1734
02:47:12,680 --> 02:47:12,680
Good

1735
02:47:18,790 --> 02:47:19,750
afternoon.

1736
02:47:20,490 --> 02:47:21,630
Hi, my name is Brian Anderson.

1737
02:47:21,970 --> 02:47:24,410
I'm a member also of the Santa Cruz Veterans Alliance.

1738
02:47:25,170 --> 02:47:27,490
I'm a disabled service-connected veteran.

1739
02:47:27,490 --> 02:47:32,190
And if it wasn't for them, my pocket would be empty.

1740
02:47:32,830 --> 02:47:36,230
The cannabis is my only pain medication that I use.

1741
02:47:39,370 --> 02:47:43,730
If it wasn't for it, I wouldn't be able to function on a daily basis.

1742
02:47:44,390 --> 02:47:50,310
And the SCVA covers at this point about half of what I need to consume a month.

1743
02:47:50,870 --> 02:47:52,870
The other half comes out of my pocket.

1744
02:47:52,870 --> 02:48:19,710
I get a whole $1,500 a month through the VA as my income, and approximately $400 of that has to be put out for my medicine, and it's a great strain, and if it wasn't for the SCVA, there would be a lot of veterans in this county, because there's just a minimal few of us here today that belong to the group.

1745
02:48:19,710 --> 02:48:27,050
And we would be resorting back to black market industry and so forth.

1746
02:48:27,270 --> 02:48:33,870
And like myself, I find that I would prefer to go to a club so that I know what I'm getting.

1747
02:48:34,390 --> 02:48:42,390
The quality, that there's no pesticides, the organic manufacturing of it.

1748
02:48:42,650 --> 02:48:44,670
So that I know what I'm consuming.

1749
02:48:44,670 --> 02:48:58,430
And if it wasn't for them, and their efforts, there would be quite a few people in this county right now that are veterans, that have served the country, that are in need of this thing.

1750
02:48:58,610 --> 02:49:07,230
So I would ask the councilor to please allow them to continue giving us our medicine and the way that they do.

1751
02:49:07,810 --> 02:49:08,450
Thank you.

1752
02:49:08,650 --> 02:49:10,030
Thank you. Thank you for service.

1753
02:49:14,470 --> 02:49:14,910
Good afternoon.

1754
02:49:14,910 --> 02:49:19,390
Good morning, Chairman Leopold, county board members, staff.

1755
02:49:19,830 --> 02:49:24,050
My name is Seth Smith, I'm a member and an employee of the Santa Cruz Veterans Alliance.

1756
02:49:25,070 --> 02:49:28,410
Many of you have met with me over the last several weeks or a few months.

1757
02:49:29,070 --> 02:49:34,670
I promise we will stop, I'll stop counting you and follow you as soon as this is all over with.

1758
02:49:35,290 --> 02:49:39,430
I just wanted to come up here today and say, you guys all know my feelings already on this.

1759
02:49:39,430 --> 02:49:45,010
And we've spoken about this a lot, and you'll hear from a few other people who support us at our mission.

1760
02:49:46,450 --> 02:49:49,250
We really want to be a part of this community long term.

1761
02:49:49,430 --> 02:49:54,570
We're trying to find a way to do what we do, you know, accomplish our mission in a sustainable way.

1762
02:49:54,890 --> 02:49:58,190
That's in keeping with the values of the community, the county.

1763
02:49:59,370 --> 02:50:01,830
We're totally on board with being regulated.

1764
02:50:02,150 --> 02:50:04,290
We're totally on board with this market coming into the light.

1765
02:50:04,810 --> 02:50:09,870
We see the benefits of this on a daily basis with the members, our veteran patients that

1766
02:50:09,870 --> 02:50:10,170
we treat.

1767
02:50:10,790 --> 02:50:16,010
We currently have over 500 veteran members in the San Cruz County area, and they're coming

1768
02:50:16,010 --> 02:50:23,270
to us for anything from chronic pain to disease, to anxiety and PTSD, to traumatic brain injuries,

1769
02:50:23,810 --> 02:50:25,050
and they're seeing great results.

1770
02:50:25,130 --> 02:50:29,910
A lot of them are self-transitioning off of opioids, which are much more addictive, or cannabis

1771
02:50:29,910 --> 02:50:34,130
isn't addictive at all, but opioids which are addictive and potentially very harmful, and

1772
02:50:34,130 --> 02:50:35,510
and their self-transitioning on to cannabis.

1773
02:50:35,990 --> 02:50:37,850
We'll be advocating for this at the federal level,

1774
02:50:37,930 --> 02:50:38,530
at the state level.

1775
02:50:39,050 --> 02:50:40,570
We'll be taking a lot of your concerns

1776
02:50:40,990 --> 02:50:43,210
that you have regarding the federal laws

1777
02:50:43,210 --> 02:50:46,030
and state laws to those law makers as well

1778
02:50:46,030 --> 02:50:47,090
and advocating there.

1779
02:50:47,730 --> 02:50:49,310
So we wanna be a part of this community long term.

1780
02:50:49,510 --> 02:50:50,470
We hope that you guys see that.

1781
02:50:50,670 --> 02:50:51,850
We hope that you see that we're interested

1782
02:50:51,850 --> 02:50:53,230
not just in cannabis, but in veterans

1783
02:50:53,630 --> 02:50:55,310
and community across the spectrum.

1784
02:50:55,310 --> 02:50:56,370
And we're trying to participate

1785
02:50:56,370 --> 02:50:59,510
and be active leaders in that realm.

1786
02:50:59,870 --> 02:51:01,210
So thank you for your consideration.

1787
02:51:01,450 --> 02:51:02,750
Thank you for all your time.

1788
02:51:02,750 --> 02:51:04,510
We ask that you please let us continue this mission.

1789
02:51:04,750 --> 02:51:05,050
Thank you.

1790
02:51:05,070 --> 02:51:05,390
Thank you.

1791
02:51:10,860 --> 02:51:11,300
Afternoon.

1792
02:51:11,940 --> 02:51:13,500
My name is Socrates Rosenfeld.

1793
02:51:13,720 --> 02:51:17,200
And to be honest with you, I actually didn't know that I was going to get up here and speak.

1794
02:51:17,260 --> 02:51:20,040
But just through what transpired today, I thought compelled to do so.

1795
02:51:20,440 --> 02:51:21,580
I'm a military veteran.

1796
02:51:22,440 --> 02:51:23,860
I graduated from West Point.

1797
02:51:24,640 --> 02:51:26,900
I was a Ranger Qualified Apache helicopter pilot.

1798
02:51:27,180 --> 02:51:31,200
I commanded a attack helicopter unit in Baghdad, Iraq, in 2009.

1799
02:51:31,920 --> 02:51:35,980
I never consumed cannabis before my entire life until I actually left the Army.

1800
02:51:36,800 --> 02:51:41,140
wasn't diagnosed officially with PTSD, fortunately, I don't have pancreatic cancer.

1801
02:51:42,620 --> 02:51:46,560
But what it did for me was it brought me a sense of well-being that I could not replicate

1802
02:51:46,560 --> 02:51:47,480
with any other product.

1803
02:51:48,180 --> 02:51:53,060
I used to chew tobacco, I used to drink a lot of alcohol, and this plant was the only thing

1804
02:51:53,060 --> 02:51:55,340
that really brought me back to homeostasis.

1805
02:51:56,200 --> 02:52:01,340
And we make delineations between medicinal and recreational, but this is really a product

1806
02:52:01,340 --> 02:52:05,320
that enhances the well-being of others, whether that's connecting to loved ones.

1807
02:52:05,320 --> 02:52:13,120
Thank you, really appreciating even a sunset out here on the West Coast for me, that's well-being.

1808
02:52:14,400 --> 02:52:27,600
And I was fortunate enough, I graduated from MIT, I brought my take company out here to Santa Cruz with the intent and purpose of providing legitimate accountable access to cannabis for consumers, veterans and non-veterans alike.

1809
02:52:28,020 --> 02:52:32,080
And I was fortunate enough to link up with Santa Cruz Veterans Alliance.

1810
02:52:32,080 --> 02:52:44,540
And their values are pretty serious, and they overlap with the values in the veteran community, the values in Santa Cruz, and the values of the cannabis community as a whole.

1811
02:52:44,760 --> 02:52:48,660
So I hope they can continue their mission, and I appreciate your time today, thank you.

1812
02:52:48,820 --> 02:52:49,720
Thank you, thank you, thank you,

1813
02:52:52,760 --> 02:52:53,740
good afternoon.

1814
02:52:54,340 --> 02:53:03,360
Good afternoon, my name is Chad Payton, I'm a resident of Santa Cruz County, and I actually don't even use cannabis.

1815
02:53:03,360 --> 02:53:18,740
I'm West Point grad with these guys, I also serve in Iraq and Afghanistan, but what I have seen is the direct and profound impact it has on people who do suffer from PTSD or any of the other wide range of effects due to their combat activities.

1816
02:53:19,800 --> 02:53:23,860
And, you know, I met up with these guys after I saw what they were doing out here.

1817
02:53:23,860 --> 02:53:32,780
And just through their compassion program and also just employing veterans locally and just the services they provide locally to this county.

1818
02:53:33,200 --> 02:53:45,160
I just have to echo exactly what these guys are saying and what hope that you guys would allow them to continue to help veterans and be a part of this community because I think they're going to make it better.

1819
02:53:45,800 --> 02:53:46,280
Thanks.

1820
02:53:46,600 --> 02:53:47,040
Thank you.

1821
02:53:47,260 --> 02:53:48,160
Thank you, service.

1822
02:53:51,070 --> 02:53:51,890
Good afternoon.

1823
02:53:51,890 --> 02:53:51,950
Thank you.

1824
02:53:52,390 --> 02:53:53,030
Good afternoon.

1825
02:53:54,310 --> 02:53:55,390
Thank you very much, Board.

1826
02:53:55,910 --> 02:53:56,130
Staff.

1827
02:53:57,050 --> 02:54:00,930
My name is Aaron Newsom, I'm the co-founder and operations director of the Santa Cruz Veterans

1828
02:54:00,930 --> 02:54:06,010
Alliance and also an Afghanistan combat veteran in the United States Marine Corps 2004-2005.

1829
02:54:07,110 --> 02:54:11,410
We really appreciate the language that was put into the draft ordinance pertaining to the

1830
02:54:11,410 --> 02:54:13,870
Veterans Alliance and the veteran community here.

1831
02:54:14,430 --> 02:54:17,070
I know you're all aware of the community we're trying to build here with our Veterans

1832
02:54:17,070 --> 02:54:22,770
compassion program. We would like to continue to give out free medicine to disabled low-income

1833
02:54:22,770 --> 02:54:28,490
and in-need veterans here in Santa Cruz. As you know we've completed the study with the Department

1834
02:54:28,490 --> 02:54:33,570
of Veteran Affairs in Sanford University in the process of publishing that. We would like to do

1835
02:54:33,570 --> 02:54:39,130
more studies with the VA. We will be doing more studies with the VA and we just ask for a safe

1836
02:54:39,130 --> 02:54:45,270
and welcoming place to do that. I think this is a much bigger issue than some people might think.

1837
02:54:46,170 --> 02:54:50,550
The veteran's suicide rate is 21% higher than the general population.

1838
02:54:51,730 --> 02:54:55,550
Veteran opioid overdoses are almost double the national average and

1839
02:54:55,550 --> 02:54:59,870
prescriptions for hydrocodone, oxycodone, methadone, and morphine have jumped

1840
02:54:59,870 --> 02:55:03,730
270% in the last 12 years amongst VA patients.

1841
02:55:04,730 --> 02:55:08,790
We have to show our veterans that we really care and that we're really willing to do

1842
02:55:08,790 --> 02:55:11,430
something and put some backbone into what we say.

1843
02:55:12,250 --> 02:55:14,830
not just give lip service and not just a pat on the back.

1844
02:55:15,730 --> 02:55:25,070
As veterans, we're used to the struggle, we're used to the game of hurry up and wait, and we're used to play in the long game, which we will continue to play.

1845
02:55:26,950 --> 02:55:33,070
And we're in it for sustainability, longevity, and this mission will sustain, and we really appreciate your support.

1846
02:55:33,310 --> 02:55:34,270
Thank you very much for your time.

1847
02:55:35,110 --> 02:55:35,570
Thank you.

1848
02:55:35,570 --> 02:55:36,670
Good

1849
02:55:39,520 --> 02:55:48,020
afternoon. I'm Brenda Chadwick. I'd like to thank every veteran here, men and women. I hope there are some women here for their service.

1850
02:55:49,380 --> 02:55:59,260
And I 100% support their effort. Even though I'm not a veteran, I have donated to the Santa Cruz veterans.

1851
02:55:59,980 --> 02:56:05,800
But curiously, I'm not going to be able to do that once the new ordinance has passed.

1852
02:56:05,800 --> 02:56:12,300
I do have a personal medical cannabis garden.

1853
02:56:13,100 --> 02:56:18,980
I've been involved ever since I found out there was a C4 committee attending them.

1854
02:56:19,620 --> 02:56:22,980
I registered non-anonymously.

1855
02:56:23,500 --> 02:56:25,520
I am registered to pay my taxes.

1856
02:56:26,380 --> 02:56:30,000
But my little garden is a 10 by 10.

1857
02:56:33,620 --> 02:56:42,260
And the first time that I sold my access was to pay for medical bills that I didn't

1858
02:56:42,260 --> 02:56:43,000
have the money for.

1859
02:56:44,760 --> 02:56:49,380
So that was really life saving for me.

1860
02:56:51,480 --> 02:56:58,820
I want to be part of the answer, I want to be part of the process, I want to feel that

1861
02:56:58,820 --> 02:57:01,820
that I am contributing to my community.

1862
02:57:02,900 --> 02:57:05,220
I'm doing everything in my power to do that,

1863
02:57:05,580 --> 02:57:09,920
but the ordinance leaves me out

1864
02:57:10,720 --> 02:57:12,120
because of where I live.

1865
02:57:13,540 --> 02:57:17,960
I'm moving forward because that's how much I believe

1866
02:57:17,960 --> 02:57:19,800
in what needs to be done.

1867
02:57:20,720 --> 02:57:22,680
And I will continue to do that

1868
02:57:23,240 --> 02:57:27,780
and hope that your board will be more inclusive

1869
02:57:27,780 --> 02:57:44,400
In the small growers who do want to participate, and lastly, I wouldn't just quickly remind everyone that the registration process started before knowing that the type I see license tier through the state.

1870
02:57:44,780 --> 02:57:46,820
So I hope you take that into consideration.

1871
02:57:47,280 --> 02:57:48,100
Thank you all very much.

1872
02:57:48,260 --> 02:57:48,520
Thank you.

1873
02:57:53,680 --> 02:57:54,460
Good morning.

1874
02:57:54,460 --> 02:57:57,860
My name is Peter Brazil, I'm here on behalf of Suncrest Nurseries.

1875
02:57:58,140 --> 02:58:04,060
It's an agricultural operator who has been in the county for decades, who is interested in cannabis cultivation.

1876
02:58:05,440 --> 02:58:14,100
Their first concern is regarding the indoor only kind of language within the current cannabis ordinance, cultivation ordinance.

1877
02:58:14,580 --> 02:58:22,380
They want to point out that greenhouses are much more agriculturally friendly environment from which to grow in.

1878
02:58:22,380 --> 02:58:28,740
there is a need, we do recognize need for indoor grow, it provides a different kind of flower product in greenhouse wood.

1879
02:58:29,160 --> 02:58:36,500
There's quite a few greenhouses in this county as there are in the surrounding counties which suffered greatly from NAFTA and a few other regulations of the 90s.

1880
02:58:36,920 --> 02:58:39,720
This is allowing them, repurposing of these greenhouses.

1881
02:58:40,340 --> 02:58:48,760
We're not saying using every single one of them for them, many of these will operate smaller, but they want the ability to cultivate within those facilities.

1882
02:58:48,760 --> 02:58:54,620
In addition, addressing another aspect of concern is the limitations on acreage for these facilities.

1883
02:58:54,840 --> 02:58:58,520
Again, we're talking about an agricultural product and an agricultural region.

1884
02:58:59,340 --> 02:59:03,060
Anybody who's familiar with that understands the margins and fluctuations that occur

1885
02:59:03,060 --> 02:59:07,700
and unless you can ramp up your size, you many times cannot compete or survive.

1886
02:59:08,700 --> 02:59:13,220
Lastly, I'd also like to point out some issues regarding multiple permits

1887
02:59:13,220 --> 02:59:17,360
for some people called premises, parcel, lot, whatever you want to call it.

1888
02:59:17,360 --> 02:59:22,880
Again, this goes to the idea of being able to ramp up a ramp down and modify your operations

1889
02:59:23,340 --> 02:59:24,900
to reflect the changing industry.

1890
02:59:25,280 --> 02:59:26,280
Thank you very much for your time.

1891
02:59:26,380 --> 02:59:26,700
Thank you.

1892
02:59:27,160 --> 02:59:27,640
Good

1893
02:59:29,850 --> 02:59:30,190
afternoon.

1894
02:59:30,650 --> 02:59:30,670
Hi.

1895
02:59:30,990 --> 02:59:34,790
I'm Grant Palmer, Canacruz Collective, and Santa Cruz Normal.

1896
02:59:36,090 --> 02:59:38,510
First of all, I just want to say I agree with everything Peter said.

1897
02:59:39,010 --> 02:59:45,370
The only way to really keep middle-class people to afford to keep farming is to allow them

1898
02:59:45,370 --> 02:59:51,190
use more their property to cultivate, they can't, you know, not every farmer can afford 25 acres in Santa Cruz.

1899
02:59:52,670 --> 02:59:59,910
The other issue is, this year last year, we gave away $550,000 and gave away and discounted.

1900
03:00:00,000 --> 03:00:29,980
We're the cannabis last year. A lot of that to our really serious cancer patients and so on, it comes in the form of oil, because that's what I can afford to give people. A lot of these seriously ill people require a tremendous amount of milligrams of cannabis, and I can't afford to give them that much cold water hash. There's not that much. I have my store. It requires all the solvent extraction. And when we are basically having that in very such a way,

1901
03:00:29,980 --> 03:00:35,920
limited zoning, there's not going to be any place to produce it, and it's going to go back to the black market.

1902
03:00:37,220 --> 03:00:43,420
We need to have those zones available, and most of these solvents used are already on farms.

1903
03:00:43,620 --> 03:00:48,560
You know, most farms have a propane tank on site, so this really isn't that different.

1904
03:00:49,060 --> 03:00:52,260
I'd like to at least study that in the environmental impact report, thank you.

1905
03:00:52,560 --> 03:00:52,880
Thank you.

1906
03:00:56,470 --> 03:00:57,310
Good afternoon.

1907
03:00:57,310 --> 03:01:06,850
Good afternoon, my name is Ashley Shields, I am the new executive director of Santa Cruz Normal, I'm very happy to be here today.

1908
03:01:07,190 --> 03:01:14,970
I'd like to thank all of you for your contributions and your persistence in continuing to develop a fair regulation for cannabis.

1909
03:01:14,970 --> 03:01:17,090
We very much appreciate that in this county.

1910
03:01:18,930 --> 03:01:25,510
I would like to address my concerns regarding personal use guidelines.

1911
03:01:26,470 --> 03:01:33,950
I noticed in some literature that we are limiting personal cultivation to one per parcel.

1912
03:01:34,850 --> 03:01:40,170
In the event that there's multiple duplexes on one parcel, or an apartment complex on one

1913
03:01:40,170 --> 03:01:45,190
parcel, this presents a little bit of a conflict of interest regarding everybody's

1914
03:01:45,190 --> 03:01:50,010
individual ability to have a personal cultivation of six plants or up to six plants.

1915
03:01:51,050 --> 03:01:58,390
I am also concerned regarding the requirement of a written letter from a landlord.

1916
03:01:58,630 --> 03:02:02,330
At this point, we're putting our landlords in the position to commit a federal crime

1917
03:02:02,330 --> 03:02:03,050
in writing.

1918
03:02:04,130 --> 03:02:08,570
I am inclined to think that they are not going to be willing to do this, which also puts

1919
03:02:08,570 --> 03:02:12,430
restrictions on personal use that are not actually written.

1920
03:02:12,650 --> 03:02:13,870
They're much more subtle at that point.

1921
03:02:13,870 --> 03:02:22,870
I noted as well that there was language regarding viewability, AMA references that personal

1922
03:02:22,870 --> 03:02:25,010
cultivation should not be viewable by the public.

1923
03:02:25,570 --> 03:02:31,430
I noted in our literature that that also is inclusive of adjacent parcels.

1924
03:02:32,090 --> 03:02:36,910
I'm concerned that that is going to promote privacy breaches.

1925
03:02:38,170 --> 03:02:41,610
We're encouraging other people to look into other people's windows at that point.

1926
03:02:41,610 --> 03:02:48,550
If it's a medical growth, then you're also addressing HIPAA breaches, which is a whole new type of privacy regulation.

1927
03:02:49,830 --> 03:02:55,230
I would like to also support everybody who's spoke regarding high taxation.

1928
03:02:55,850 --> 03:02:59,690
This absolutely does push the black market and encourage the black market.

1929
03:03:00,250 --> 03:03:10,030
So for me, I would very much like to caution the board that over regulation of personal use,

1930
03:03:10,030 --> 03:03:14,310
high tax rates and a trust that is that regarding the permitting process.

1931
03:03:15,490 --> 03:03:16,330
Thank you.

1932
03:03:16,610 --> 03:03:17,590
Thank you, Alphe.

1933
03:03:23,900 --> 03:03:29,320
My name is Becky Steinbruner and I want to thank all of you and Mr. Peterson for your good

1934
03:03:29,320 --> 03:03:34,720
work and thank all of the people that took the time out of their day to come here and say

1935
03:03:34,720 --> 03:03:35,180
their thoughts.

1936
03:03:36,020 --> 03:03:40,800
I also want to bring you to why there have been two sheriff's deputies brought into the

1937
03:03:40,800 --> 03:03:43,500
room in addition to the security guard.

1938
03:03:43,500 --> 03:03:52,960
I have not seen them here this morning earlier, and I think it is a bad form to bring in law enforcement to this meeting.

1939
03:03:53,980 --> 03:04:02,300
I want to take issue with a district two exclusion for outdoor cultivation on any acreages less than five acres.

1940
03:04:02,720 --> 03:04:07,300
I want the board again to remove that district two outdoor restriction.

1941
03:04:07,880 --> 03:04:10,860
I know why it's there, and it's not fair.

1942
03:04:11,880 --> 03:04:16,020
I have seen what happens when people are forced to grow indoors.

1943
03:04:16,320 --> 03:04:20,460
There were double structure fires in my neighborhood because of that indoor growing.

1944
03:04:21,600 --> 03:04:26,380
Indoor growing even in a greenhouse as plastic hoop house requires ventilation.

1945
03:04:26,940 --> 03:04:35,920
That increases energy use, that increases a plastic pollution demand to create a hoop house even.

1946
03:04:35,920 --> 03:04:41,380
And it increases costs for those who are low income and just trying to grow their own medicine.

1947
03:04:42,040 --> 03:04:46,300
And that's the bottom line here. This is medicine for many, many people as you have heard.

1948
03:04:47,260 --> 03:04:55,380
It also increases the fire risk for the outdoor areas that are being forced to grow indoors due to poor wiring.

1949
03:04:56,120 --> 03:05:02,580
This is a very high tax on an industry who has come forward and willingly cooperate with you, with a C4.

1950
03:05:03,060 --> 03:05:09,320
They have so much, they've come to you and asked to cooperate and you're penalizing them with a tax.

1951
03:05:09,460 --> 03:05:11,980
Supervisor Leopold, I want to thank you for your good words.

1952
03:05:12,400 --> 03:05:15,740
The county is being greedy with this high tax.

1953
03:05:15,960 --> 03:05:23,640
I would like a 1% tax, get these people in, gain their trust, and reward them for the good work that they have done with you.

1954
03:05:23,640 --> 03:05:27,400
So please let the Veterans Alliance in on phase one.

1955
03:05:27,520 --> 03:05:32,340
You've heard why, and there is a definitely need if you do a cost benefit analysis.

1956
03:05:32,760 --> 03:05:33,060
Thank you.

1957
03:05:42,700 --> 03:05:42,880
Hi.

1958
03:05:43,500 --> 03:05:44,680
My name is Julia Giddinsky.

1959
03:05:44,900 --> 03:05:48,900
I'm a long-term resident of Bonnie Dune, I've spoken here two several times.

1960
03:05:50,040 --> 03:05:54,900
Today I want to address the issue of personal grows and why I think it is actually very critical

1961
03:05:54,900 --> 03:06:01,020
that they'd be regulated, and it's primarily due to the current reality and history of diffuse

1962
03:06:01,020 --> 03:06:08,740
growing in this county. According to the numbers in the memo for today's agenda item 951 people

1963
03:06:08,740 --> 03:06:15,440
began the registration process for legal permits to grow 760 completed them. And according

1964
03:06:15,440 --> 03:06:22,940
to my conversations with Mr. Peterson, only about 300 to 350 people will be allowed to have

1965
03:06:22,940 --> 03:06:30,880
legal permits to grow in this county if something like 7.128 is passed. That leaves some

1966
03:06:30,880 --> 03:06:42,340
Somewhere in the neighborhood of 500 plus or minus 100 people who want to grow cannabis in this county may indeed already be growing cannabis in this county without a legal outlet to do so.

1967
03:06:42,920 --> 03:06:54,560
So to think that personal grows are not going to be pressured and abused by such a large body of people who want to grow a very valuable crop, I think it's extremely unrealistic.

1968
03:06:54,560 --> 03:07:02,360
And I think it is absolutely critical that personal grows be regulated and that it would be done so in a very clear manner.

1969
03:07:03,140 --> 03:07:11,500
And to that end, I think the regulations that Mr. Peterson has put forward are very reasonable, especially the one grow per parcel.

1970
03:07:12,220 --> 03:07:17,880
And I also think that the indoor grow only is very important because it's enforceable.

1971
03:07:18,420 --> 03:07:21,500
And none of these regulations are going to mean anything if they're not enforced.

1972
03:07:21,500 --> 03:07:27,380
and personal grows are going to be extremely difficult to enforce, especially since we know

1973
03:07:27,380 --> 03:07:33,080
the pattern of diffuse growing throughout the county. So, the other point I want to

1974
03:07:33,080 --> 03:07:37,740
make is to the degree that personal grows are abused. They will be undercutting the

1975
03:07:37,740 --> 03:07:42,140
growers that are coming into the legal system and are paying the taxes. So, thank you.

1976
03:07:42,700 --> 03:07:42,900
Thanks.

1977
03:07:46,600 --> 03:07:51,740
Good afternoon. Good afternoon. My name is Shabba Calintari Johnson and I'm a member

1978
03:07:51,740 --> 03:07:55,580
of community prevention partners, a drug and alcohol prevention coalition.

1979
03:07:56,140 --> 03:08:00,320
Thank you to the board and the staff for the tremendous work that you've done and really

1980
03:08:00,320 --> 03:08:05,180
listening to and integrating the various perspectives that are part of this complex

1981
03:08:05,180 --> 03:08:05,660
issue.

1982
03:08:06,260 --> 03:08:11,820
I'm here to talk about part of the prevention and public health perspective, just a few

1983
03:08:11,820 --> 03:08:12,220
points.

1984
03:08:13,500 --> 03:08:20,140
To reiterate Ms. Kudinsky's points, we also believe that personal growth, there is a potential

1985
03:08:20,140 --> 03:08:25,600
for misuse of personal grows and for them to turn into a black market in which young people

1986
03:08:25,600 --> 03:08:30,560
can access recreational cannabis so that we hope that there is some sort of oversight and regulation

1987
03:08:30,560 --> 03:08:39,580
on personal grows. We hope that the board and staff will keep in mind the lessons learned from

1988
03:08:39,580 --> 03:08:44,320
alcohol and tobacco when we're talking about manufacturing and when we're talking about advertisement

1989
03:08:44,320 --> 03:08:49,860
and potentially loosening the restrictions on advertisement. Two other pieces in manufacturing

1990
03:08:49,860 --> 03:08:55,580
We'd like the board to consider restrictions on products that resemble cartoon characters,

1991
03:08:56,000 --> 03:09:00,320
animals, things that would be attractive to young people, and also restrictions on packaging

1992
03:09:00,320 --> 03:09:01,300
that appeal to youth.

1993
03:09:02,140 --> 03:09:09,620
And final point is the CBP and our advocacy, our prevention advocacy groups, really support

1994
03:09:10,320 --> 03:09:16,520
businesses and programs that put into place compassionate programs such as the Veterans Alliance.

1995
03:09:16,520 --> 03:09:31,100
We hope that the Board will allow for an opportunity for the Veterans Alliance to obtain licensing and to implement their programs, and we hope that the Board will look at ways of incentivizing compassionate programs for other cannabis businesses.

1996
03:09:31,600 --> 03:09:32,140
Thank you.

1997
03:09:32,640 --> 03:09:33,000
Thank you.

1998
03:09:38,110 --> 03:09:39,950
Good afternoon, Dr. Andy Hospitaler.

1999
03:09:40,310 --> 03:09:45,570
Long term resident of the first district and also have a registered cultivation site in the second district.

2000
03:09:47,410 --> 03:09:51,610
I work up at UC Santa Cruz, I run a center for the National Science Foundation.

2001
03:09:51,890 --> 03:09:58,510
Recently, it was qualified as a court expert witness by the federal and the state of California in Metacannabis.

2002
03:09:58,850 --> 03:10:03,610
I want to thank Dan Peterson's office for pulling it together and getting us some regulation that we can work with.

2003
03:10:04,190 --> 03:10:06,150
This is a big step, so thank you very much.

2004
03:10:06,730 --> 03:10:08,970
I'm here to talk about two things I want to comment on.

2005
03:10:09,290 --> 03:10:12,950
First of all, what I call explosive solvents.

2006
03:10:12,950 --> 03:10:16,670
an explosive solvent, specifically, or isopropane and butane.

2007
03:10:16,950 --> 03:10:22,010
There are currently no sources of medical grade butane, sold within Santa Cruz County.

2008
03:10:22,310 --> 03:10:28,050
So any butane that's used for processing is being transported into Santa Cruz County, which is automatically a hazard.

2009
03:10:28,610 --> 03:10:35,050
In my personal scientific opinion and my professional opinion, there's no reason to use butane to process cannabis.

2010
03:10:36,170 --> 03:10:38,190
Well, that's fun.

2011
03:10:40,350 --> 03:10:44,430
And isopropane, there is no medical grade of isopropane that should be used to process.

2012
03:10:44,630 --> 03:10:46,010
So there's no reason to use these gases.

2013
03:10:46,350 --> 03:10:50,390
We can do better using alkanes, alcohols, and CO2.

2014
03:10:51,070 --> 03:10:56,710
The second comment I have is today we learned that somewhere between $3.2 million and $10 million

2015
03:10:56,710 --> 03:11:00,770
of tax revenue is expected from cannabis tax.

2016
03:11:00,770 --> 03:11:04,870
And my understanding is the majority of that is going into enforcement.

2017
03:11:05,290 --> 03:11:09,370
I'd like to suggest to the county that we could return some of that to the benefit

2018
03:11:09,370 --> 03:11:13,330
of the community by allowing it to be spent on research and development,

2019
03:11:13,690 --> 03:11:18,150
to do studies for our own residents that would benefit them that have pancreatic cancer,

2020
03:11:18,530 --> 03:11:21,910
that have PTSD, and do this locally at the Santa Cruz level.

2021
03:11:22,210 --> 03:11:24,910
Certainly, we're not talking about a billion-dollar drug trial.

2022
03:11:25,050 --> 03:11:27,510
We're talking about something that can be done very simply here.

2023
03:11:27,510 --> 03:11:38,510
In the past, they did one in 2014 for pancreatic cancer, and in 2015, for REM behavioral sleep disorder associated with Parkinson's disease, I'd be happy to do that as well.

2024
03:11:39,010 --> 03:11:39,570
Thank you so much.

2025
03:11:39,790 --> 03:11:40,150
Thank you.

2026
03:11:44,050 --> 03:11:45,610
Good afternoon, Supervisor.

2027
03:11:45,810 --> 03:11:46,650
It's Colin Dishirune.

2028
03:11:47,450 --> 03:11:57,450
I'm a board member of the Association for Standardized Cannabis and the Executive Director of Santa Cruz Naturals, and I have been working in the cannabis industry for quite some time.

2029
03:11:57,450 --> 03:12:00,590
And I also have a degree in resource and park management.

2030
03:12:01,880 --> 03:12:10,150
And I, having grown up in a very Republican household and diverting towards the democratic

2031
03:12:10,150 --> 03:12:15,550
side of things, when I opened Santa Cruz Naturals, my dad told me that doing so was one of

2032
03:12:15,550 --> 03:12:17,370
the most Republican things I could have done.

2033
03:12:18,910 --> 03:12:27,390
And in doing so, one of the Republican viewpoints that I have been sharing is the reduction

2034
03:12:27,390 --> 03:12:35,310
in taxes, as associated with cannabis industry, and that being said, I believe that by lowering

2035
03:12:35,310 --> 03:12:42,390
taxes, and this is as we've seen in Oregon and Washington and Colorado, we are going

2036
03:12:42,390 --> 03:12:47,410
to see an increase in revenue coming into the county. And that's because it's going

2037
03:12:47,410 --> 03:12:53,750
to bolster businesses. And right now, what we're seeing obviously is this high tax rate

2038
03:12:53,750 --> 03:13:06,330
is scaring a lot of people away. So I would encourage you to really consider lowering the tax significantly and increasing the amount of businesses that are going to be generating tax revenue.

2039
03:13:06,630 --> 03:13:15,750
That's one. The other thing that I want to talk about today is the special conditions that the second district have with regard to cultivation.

2040
03:13:16,610 --> 03:13:22,210
I believe that there are good intentions behind it, but there are unintended consequences

2041
03:13:22,210 --> 03:13:23,450
that are going to be a result.

2042
03:13:24,090 --> 03:13:28,550
One of those really important unintended consequences is going to be the continued

2043
03:13:28,550 --> 03:13:33,350
environmental impact that's going to be caused by people who cannot bring their cultivation

2044
03:13:33,350 --> 03:13:40,410
sites up to code, and they're going to be dodging the system and continuing to do their operations

2045
03:13:40,410 --> 03:13:41,010
as it is.

2046
03:13:41,010 --> 03:13:46,450
That's going to lead to increased code enforcement, increased law enforcement, and increased environmental impact.

2047
03:13:46,850 --> 03:13:55,090
And the last thing that I want to add is that there will be an increase in buildings that are going to be vacant in five years when the cannabis industry crashes.

2048
03:13:55,290 --> 03:13:55,650
Thank you.

2049
03:14:00,070 --> 03:14:00,850
Good afternoon.

2050
03:14:01,130 --> 03:14:02,310
Good afternoon, board and staff.

2051
03:14:02,830 --> 03:14:03,750
My name is Bryce Barriessa.

2052
03:14:04,010 --> 03:14:07,290
I'm a local dispensary operator and cannabis business owner in the county.

2053
03:14:07,750 --> 03:14:13,970
I'm familiar with all of you and first off, I want to say thank you for all of the time we've put in over the years to get to this point.

2054
03:14:13,970 --> 03:14:17,630
Our joke at the ASC has always been that we try to get you to treat us like every other business.

2055
03:14:17,850 --> 03:14:19,790
So as soon as you do, we can then lobby against all the regulation.

2056
03:14:20,170 --> 03:14:21,630
So we're almost to that point.

2057
03:14:22,270 --> 03:14:25,130
So in spirit of that, I would like to lobby against taxes.

2058
03:14:26,330 --> 03:14:32,850
Your board passed or the voters passed a tax measure in November that allows your board to lower or raise the taxes as you see fit.

2059
03:14:33,250 --> 03:14:40,090
I'm here to encourage you today to take a little bit of leap of faith in the betterment of not only the industry but the county of Santa Cruz and lower the taxes.

2060
03:14:40,970 --> 03:14:45,230
The RCSC put out a terrific letter that I hope you all had the opportunity to read, advocating

2061
03:14:45,230 --> 03:14:50,230
to lower it to 5% across the board for now, get some data, see the revenue come in.

2062
03:14:50,970 --> 03:14:55,290
I signed on for both of my businesses to that letter, although I believe that the tax rate

2063
03:14:55,290 --> 03:14:58,810
for manufacturing should be quite a bit lower to that than that, but I think it's a great

2064
03:14:58,810 --> 03:14:59,170
start.

2065
03:14:59,170 --> 03:14:59,970
I wish I was-

2066
03:15:00,000 --> 03:15:29,400
I was coming to you in a position of strength saying, look at all of us that have come and paid taxes and the floodgates have opened since November. Unfortunately, that's not the case, which makes us a little bit of a one-sided argument. But what I can guarantee you is that we have a wonderful, deep robust, innovative creator of jobs and wonderful products in the Santa Cruz community. And I think that given them a little care, it would very much help them feel solidified as we're going through this process to develop manufacturing ordinances. And I encourage everyone behind me to step up to the bat and spread the word.

2067
03:15:29,400 --> 03:15:32,280
like wildfire to have people get in and start paying those taxes.

2068
03:15:32,800 --> 03:15:57,400
And I think that you're going to get a lot of buy-in and a lot of appreciation and more importantly you're going to get a lot of really well-established, well-intentioned businesses that are here currently that employ hundreds of people throughout the county to stay here, because it's 7% especially for manufacturing where we have to compete across the state unlike the dispensaries where we're only competing with 13 others, 7% the de facto ban, we can't afford to do business, we have the highest operating cost of any segment in the industry for manufacturing.

2069
03:15:57,400 --> 03:16:04,380
And we're one of the greatest employers and I think it's really important to protect the manufacturing community and a little gesture would go a long way.

2070
03:16:04,600 --> 03:16:04,900
Thank you.

2071
03:16:10,600 --> 03:16:13,520
Hello, Pat Mello, lifetime resident.

2072
03:16:13,800 --> 03:16:17,800
I say I'm only hoping to be able to continue to live here in the future.

2073
03:16:18,300 --> 03:16:26,540
So I'd like to thank the board for including a lot of issues that we need to get to, or the staff and

2074
03:16:26,540 --> 03:16:30,300
Dan Peterson, including all the issues we need to get moving on.

2075
03:16:30,780 --> 03:16:33,940
I like that we have the beginnings of the manufacturing draft.

2076
03:16:34,160 --> 03:16:41,760
I like that we're starting a conversation about taxes and what they need to be for us to go forward.

2077
03:16:42,200 --> 03:16:48,000
I really like that the EIR process has been open to the public.

2078
03:16:48,000 --> 03:16:49,860
We had a wonderful meeting last night.

2079
03:16:50,320 --> 03:16:55,920
And just a comment on an insight that I kind of was thinking about at the EIR yesterday is that

2080
03:16:55,920 --> 03:17:01,680
We might have one of the first EIRs in history where the less or the more permissive

2081
03:17:01,680 --> 03:17:07,140
option has less environmental impact than the more conservative option or the draft

2082
03:17:07,140 --> 03:17:10,220
board, and that's for a very unique situation.

2083
03:17:10,440 --> 03:17:16,460
It's because that the more people that we include in this new thing called regulated

2084
03:17:16,460 --> 03:17:20,400
cannabis, the less people that are going to be excluded.

2085
03:17:20,400 --> 03:17:27,100
And we've heard from the lab, from individual after individual saying how their gardening situation,

2086
03:17:27,460 --> 03:17:31,860
their manufacturing situation, is not going to work under this new ordinance.

2087
03:17:32,180 --> 03:17:37,780
And more often than not, those are the smaller producers, those are the ones who have the least ability to move.

2088
03:17:38,520 --> 03:17:47,480
And so, John, you had a good statement about the tax revenue and we don't have time to get into that with other things.

2089
03:17:47,480 --> 03:17:55,400
But, you know, we can either get this whole system right, be inclusive, capture the tax revenue or we can capture the cultivators.

2090
03:17:55,700 --> 03:18:03,420
And let me remind everyone that in Trump's America, in Santa Cruz County, capturing anyone has become unacceptable.

2091
03:18:03,920 --> 03:18:04,740
So, thank you.

2092
03:18:11,360 --> 03:18:14,900
Charlie Smith, I also came to talk about inclusion.

2093
03:18:14,900 --> 03:18:23,000
I talked once before here, your CA regulations allows a one acre, but your RA says five acres.

2094
03:18:23,520 --> 03:18:26,540
I ask again, why five acres?

2095
03:18:27,000 --> 03:18:30,200
How many parcels in the RA areas are five acres?

2096
03:18:30,220 --> 03:18:33,300
You're excluding the smaller and middle size people.

2097
03:18:34,140 --> 03:18:40,360
I mean, if you make it one acre, if you make it two acres, that I can supplement my income

2098
03:18:40,360 --> 03:18:43,140
as a retiree, I really don't want to rent a room out.

2099
03:18:43,700 --> 03:18:50,220
On Airbnb, you're picking your pockets of your constituents by having such a high

2100
03:18:50,220 --> 03:18:51,700
level of regulation.

2101
03:18:52,240 --> 03:18:56,700
It is unnecessary, by the way, it's just a draft for that size right now, correct?

2102
03:18:57,860 --> 03:19:04,200
Well, that how can he threaten that my anonymous license would go away in June when

2103
03:19:04,200 --> 03:19:06,100
that acreage has not been finalized?

2104
03:19:06,520 --> 03:19:08,780
I'm sure you could appreciate it if I find that offensive.

2105
03:19:08,780 --> 03:19:16,860
In any case, I ask again that you reconsider the RA designation so that more people can

2106
03:19:16,860 --> 03:19:17,400
be included.

2107
03:19:18,360 --> 03:19:23,700
Another option in that RA designation, I have a wife and two adult children over 25 on

2108
03:19:23,700 --> 03:19:29,180
my parcel, would be four grow areas, but your new one says it only one grow area on that

2109
03:19:29,180 --> 03:19:29,580
parcel.

2110
03:19:30,080 --> 03:19:33,480
Again, that's restricting what I think is my freedom and rights.

2111
03:19:34,160 --> 03:19:35,080
Thank you very much.

2112
03:19:35,400 --> 03:19:35,680
Thank you.

2113
03:19:40,770 --> 03:19:46,270
If they everyone, cricket here, wants to be know who I am, I have a couple thoughts.

2114
03:19:46,930 --> 03:19:54,090
One is multiple licensing to be able to be grouped together as a way of consolidating

2115
03:19:54,490 --> 03:19:56,450
for the cannabis cultivation side of it.

2116
03:19:57,010 --> 03:20:03,070
And this is the final thought I was thinking about how we have a pre-registration situation

2117
03:20:03,070 --> 03:20:04,150
for cultivation.

2118
03:20:04,630 --> 03:20:08,290
I was thinking that maybe it might be a good idea to do that for manufacturing.

2119
03:20:08,290 --> 03:20:12,870
So we could get a feel for who's here and who wants to participate.

2120
03:20:13,310 --> 03:20:16,470
So I thought this would be a great opportunity to plant that seed with all of you.

2121
03:20:16,950 --> 03:20:17,210
Thank you.

2122
03:20:17,430 --> 03:20:17,710
Thank you.

2123
03:20:21,610 --> 03:20:23,710
Last chance for any public comment.

2124
03:20:25,070 --> 03:20:30,250
I'll bring it back to our board for discussion and bottle action.

2125
03:20:30,970 --> 03:20:31,890
Supervisor Caput.

2126
03:20:35,790 --> 03:20:38,870
I'll go through this quick because I know people have been waiting a long time.

2127
03:20:40,470 --> 03:20:49,470
applications I noticed was about 81 in District 4. It looks like about 81. Who has

2128
03:20:49,470 --> 03:20:57,370
send runs of valley? It looks like 188. I mean, that's a lot. Is that your area? Okay.

2129
03:20:59,980 --> 03:21:06,800
If I had an 188, I don't think I'd be going along with this, but I was worried about

2130
03:21:06,800 --> 03:21:12,080
too much going into District 4. It looks like it's not going to be that way. I calculated

2131
03:21:12,080 --> 03:21:17,960
it out to about 9 and a quarter percent for cultivation. It would be in District 4.

2132
03:21:20,640 --> 03:21:27,200
Anyway, I'm the guy that was in the beginning for compassionate use and medical marijuana

2133
03:21:27,200 --> 03:21:34,520
grows and all that. I voted against recreational use. I think it's a mistake, but anyway,

2134
03:21:34,520 --> 03:21:41,200
way we had the vote in California at past and so what I'm getting at is I'm a reluctant

2135
03:21:42,320 --> 03:21:50,980
participant in this process right now and recreational I believe in my opinion is taken

2136
03:21:50,980 --> 03:21:58,200
it now from compassionate to money. It's becoming a big money generator. I'm not I'm sure the

2137
03:21:58,200 --> 03:22:05,920
the only supervisor that's been asked on a number of occasions by constituents and people

2138
03:22:05,920 --> 03:22:11,140
saying, well, once you get to marijuana tax, you can fix up all these potholes.

2139
03:22:11,700 --> 03:22:17,740
Once you get the tax, you can start working on that levy and getting it all done.

2140
03:22:18,580 --> 03:22:26,000
It's almost become like this, or even a non-profit said, hey, how about give it some money for

2141
03:22:26,000 --> 03:22:33,600
are not profit. It's serious business when we get into recreational use and all that.

2142
03:22:35,240 --> 03:22:42,180
The marijuana I've been told today is from 50 times to 100 times stronger, more refined

2143
03:22:42,580 --> 03:22:50,560
than the marijuana of the 1960s. So there's a tipping point there how careful people have

2144
03:22:50,560 --> 03:22:55,200
to be and how prevalent it'll become in the society.

2145
03:22:56,240 --> 03:23:03,000
So we do have to be careful in going through this whole process, very serious.

2146
03:23:06,300 --> 03:23:10,780
The big thing for me is protecting the environment.

2147
03:23:12,100 --> 03:23:18,120
We're here, we're at where we are now, in my opinion, because of the failure to be able

2148
03:23:18,120 --> 03:23:24,540
to regulate and actually be able to control illegal growing anyway.

2149
03:23:25,280 --> 03:23:28,760
It's just what is happening, destroying the environment.

2150
03:23:29,460 --> 03:23:38,380
And if we can get this cooperation of the growers, public safety, to actually make sure

2151
03:23:38,760 --> 03:23:45,660
that who is growing it has got permits, got a license, we're going to do a lot to protect

2152
03:23:45,660 --> 03:23:56,200
the environment in our county so it's something we do have to be careful about and I don't want

2153
03:23:56,200 --> 03:24:06,440
to see money take this over and become a type of greed where if we tax enough we're going to get

2154
03:24:06,440 --> 03:24:14,980
money and we're going to have money for all kinds of government programs and giving raises to people

2155
03:24:14,980 --> 03:24:24,640
at the top or whatever. That's not my motivation. My motivation is the environment being protected,

2156
03:24:25,260 --> 03:24:29,980
also looking out for neighbors that are living next door to people that are going to do the growing,

2157
03:24:30,800 --> 03:24:36,220
and also that, of course, compassionate youths for people that do need marijuana,

2158
03:24:37,060 --> 03:24:43,340
or it's probably less toxic to their system than a lot of other drugs that they are taking.

2159
03:24:43,340 --> 03:24:58,340
So the other last thing I'll say is, if the Veterans, Santa Cruz Veterans Alliance is not included, I may change how I'm leaning in May.

2160
03:24:59,000 --> 03:25:11,780
Okay, so anyway, I'm going along with this today, but I'm going to look real close on what's happening with veterans out there and make sure they're included in the May review.

2161
03:25:12,200 --> 03:25:12,460
Thank you.

2162
03:25:12,460 --> 03:25:13,500
Thank you.

2163
03:25:13,700 --> 03:25:14,640
Supervisor McPherson.

2164
03:25:14,760 --> 03:25:15,340
Thank you, Mr. Chair.

2165
03:25:17,720 --> 03:25:20,940
I'm proud to be a representative of the Fifth District that includes the Santa

2166
03:25:20,940 --> 03:25:21,600
Ones of Alley.

2167
03:25:24,580 --> 03:25:29,780
But I do want to accept the recommendations that have been presented.

2168
03:25:30,100 --> 03:25:33,680
And I want to thank our Dan Peterson for the excellent job.

2169
03:25:34,300 --> 03:25:41,520
He's had a short window to get this together and to add that he's done that because

2170
03:25:41,520 --> 03:25:43,980
of the cooperation with many of you who have spoken today.

2171
03:25:44,340 --> 03:25:45,520
So I do appreciate that.

2172
03:25:45,640 --> 03:25:47,700
I think we are moving in the right direction.

2173
03:25:48,720 --> 03:25:53,820
And I would like, I would be supportive of the recommended actions here.

2174
03:25:54,340 --> 03:25:58,580
I do think that the tax structure issue is going to be one that we're going to have

2175
03:25:58,580 --> 03:26:00,240
to have particular attention to.

2176
03:26:01,720 --> 03:26:06,520
And maybe it will be something when we come to budget sessions that we do something

2177
03:26:06,520 --> 03:26:11,220
that goes through this calendar year, but changes in year 2018.

2178
03:26:11,340 --> 03:26:13,540
I'm not sure how we'll work that out.

2179
03:26:13,700 --> 03:26:15,240
That's going to be extremely a lot of discussions

2180
03:26:15,240 --> 03:26:19,700
and what, if it's manufacturing, cultivation and so forth,

2181
03:26:19,700 --> 03:26:23,940
and if there can be adjustments on percentages of each of those.

2182
03:26:24,240 --> 03:26:26,580
I mean, I'm open to listening to that.

2183
03:26:27,080 --> 03:26:29,220
I have listened to some of that from some of you,

2184
03:26:30,080 --> 03:26:32,860
but I'm ready to just follow the recommended actions

2185
03:26:32,860 --> 03:26:37,060
and I agree that the Veterans Alliance

2186
03:26:37,060 --> 03:26:39,240
out of receipts and consideration as well.

2187
03:26:44,600 --> 03:26:47,320
So I just had a couple quick questions based off public comment.

2188
03:26:47,480 --> 03:26:51,500
The first was a question around limits on packaging and advertising.

2189
03:26:51,860 --> 03:26:54,600
I know that it's a fine line with first amendment,

2190
03:26:54,860 --> 03:26:56,460
but are you looking at that?

2191
03:26:57,060 --> 03:26:59,360
Yes, we are, but at the moment,

2192
03:26:59,540 --> 03:27:02,700
Auma also includes provisions as to what is allowed

2193
03:27:02,700 --> 03:27:04,800
for packaging and advertising.

2194
03:27:04,800 --> 03:27:08,700
So we will be following the statement requirements very, very closely.

2195
03:27:08,940 --> 03:27:09,900
Does that preemptus?

2196
03:27:10,300 --> 03:27:11,260
No, it does not preemptus.

2197
03:27:11,320 --> 03:27:13,940
We can be more restrictive, but we can't be less restrictive.

2198
03:27:14,660 --> 03:27:14,820
Okay.

2199
03:27:15,340 --> 03:27:21,800
Second, do you, you had mentioned that you meant to include M1 as a potential area for manufacturing?

2200
03:27:22,840 --> 03:27:25,780
Do you need direction on that or is that just part of what you're going to be doing?

2201
03:27:26,500 --> 03:27:29,800
Well, I obviously appreciate all direction that I received.

2202
03:27:30,380 --> 03:27:32,260
But at this point, that's my intent.

2203
03:27:33,460 --> 03:27:42,280
The second thing was brought up around butane and isopropane, and whether I assume you'll

2204
03:27:42,280 --> 03:27:44,860
be looking at those particular materials in more detail?

2205
03:27:45,360 --> 03:27:45,700
Absolutely.

2206
03:27:47,240 --> 03:27:54,700
And I'm ready to make a motion which is to move the staff recommendation with the additional

2207
03:27:54,700 --> 03:28:00,860
direction that on personal growth, ancillary structures is defined as to include backyard

2208
03:28:00,860 --> 03:28:21,640
are greenhouses, including kid or pre-fabricated greenhouses, that staff return to us on April 11th with a process for the Santa Cruz Veterans Alliance to apply for a dispensary license, and that staff report back to the board in August with a report on taxes that addresses some questions I passed out, and I just gave it to my fellow board members.

2209
03:28:22,100 --> 03:28:30,660
I'll read in the record and share it to you, but from a tax perspective, this is what I need to know, and I'll say parenthetically

2210
03:28:30,660 --> 03:28:35,400
that the hotel industry could fill this room and say we could make a lot more money if

2211
03:28:35,400 --> 03:28:40,860
we lowered the TOT and I hear every day that if we lowered our sales tax which in Watsonville

2212
03:28:40,860 --> 03:28:45,480
and Santa Cruz is one of the highest in the states, we'd be more competitive and it's

2213
03:28:45,480 --> 03:28:49,700
hurting family owned businesses and some of those arguments are good and some of those

2214
03:28:49,700 --> 03:28:56,560
arguments I don't entirely agree with but we try to base it on data and what we can see

2215
03:28:56,560 --> 03:29:00,000
from the numbers and I think we need to do the same thing with this tax.

2216
03:29:00,000 --> 03:29:05,900
And so the questions I have that I'm looking forward to getting answered are what percentage of cannabis and

2217
03:29:05,900 --> 03:29:10,120
registrants estimate what is a percentage of cannabis and

2218
03:29:10,120 --> 03:29:15,900
registrants estimated there will be subject to the 777 compound attack Santa Cruz County.

2219
03:29:16,360 --> 03:29:21,200
What is the estimate for how much cannabis is cultivated, manufactured, and or sold locally?

2220
03:29:21,660 --> 03:29:25,700
How much are Santa Cruz County dispensary sales from cannabis that are cultivated themselves?

2221
03:29:25,920 --> 03:29:28,740
And therefore not subject to the compound attacks rate?

2222
03:29:28,740 --> 03:29:35,880
How many cultivators will also manufacture products and therefore not be subjected to the compounded tax rate?

2223
03:29:36,380 --> 03:29:38,200
How many tax paying cultivators do we have?

2224
03:29:38,420 --> 03:29:41,000
How many cultivators and manufacturers will end up getting state licenses?

2225
03:29:41,840 --> 03:29:46,220
Has the current tax rate to press sales at Santa Cruz County's dispensaries?

2226
03:29:46,460 --> 03:29:47,680
What's the evidence of this?

2227
03:29:48,380 --> 03:29:50,160
What are the percentage of cannabis products?

2228
03:29:50,500 --> 03:29:55,260
What percentage of cannabis products overall costs are from taxes versus land, labor, and

2229
03:29:55,260 --> 03:29:59,960
other costs, and for each sector, and what are the predictions for growth in the records?

2230
03:30:05,340 --> 03:30:28,880
I think we can come back and set up tax rate. Again, I think all our goals are the same, right? We want to foster a good local industry that maximizes a sale to get the maximum tax rate. But we want to make sure we set that right. And because we're an, essentially, an exporting county, we're bearing a lot of costs of cannabis that then get it.

2231
03:30:28,880 --> 03:30:31,020
gets exported to other places and tax other places.

2232
03:30:31,680 --> 03:30:34,160
And so how do we recover some of those costs going forward?

2233
03:30:34,660 --> 03:30:40,200
And just to go off public comment, my anticipation is that we not spend all this money on

2234
03:30:40,200 --> 03:30:46,600
enforcement, my anticipation, so we spend this on mental health policies and youth programs.

2235
03:30:48,660 --> 03:30:54,320
We offset some of the amazing cuts that will be coming to us from the federal government.

2236
03:30:54,320 --> 03:30:58,600
And so, so it's very important to me that we hit these numbers because these are

2237
03:30:58,600 --> 03:30:59,920
lives that we're going to invest.

2238
03:31:01,560 --> 03:31:04,480
We're going to help serve by, with this, with these dollars.

2239
03:31:08,280 --> 03:31:10,560
So, somewhere at the beginning of that, there was a motion.

2240
03:31:12,340 --> 03:31:14,180
And somewhere at the end of that, I'll second it.

2241
03:31:15,980 --> 03:31:18,360
Is our clerk aware what the motion is?

2242
03:31:18,520 --> 03:31:21,320
So, maybe it could be clearly restated.

2243
03:31:21,320 --> 03:31:26,440
Okay. Maybe, well, the clerk gets that I could just go ahead and jump in because I think

2244
03:31:26,440 --> 03:31:31,280
there are a couple of other recommendations that your board will let the land hold

2245
03:31:31,280 --> 03:31:32,000
on right there.

2246
03:31:32,260 --> 03:31:32,280
Okay.

2247
03:31:32,400 --> 03:31:33,120
Just hold it.

2248
03:31:33,640 --> 03:31:38,740
Maybe, if you haven't written down, could we just read it in so we're clear what the motion

2249
03:31:38,740 --> 03:31:39,180
is?

2250
03:31:39,360 --> 03:31:45,040
So I'll read it, which is to adopt staff's recommendations and also the additional

2251
03:31:45,040 --> 03:31:49,960
direction that personal grows include ancillary structures that the staff return

2252
03:31:49,960 --> 03:31:54,780
to us on April 11th with a process for the Santa Cruz Veterans Alliance, and that,

2253
03:31:55,800 --> 03:32:00,720
when the staff reports back to us in August, on taxes that they address, the questions

2254
03:32:00,720 --> 03:32:01,380
that I just read.

2255
03:32:02,720 --> 03:32:03,500
And we'll hand it on to the board.

2256
03:32:03,780 --> 03:32:05,900
So is that clear for the seconder?

2257
03:32:06,000 --> 03:32:06,340
Yes, sir.

2258
03:32:06,520 --> 03:32:11,980
And just for the audience knows, Susan Galloway is our clerk of the board, and she has the

2259
03:32:11,980 --> 03:32:18,560
very unhappy job of trying to transfer what we say up here in long sentences.

2260
03:32:18,560 --> 03:32:22,020
There's something short that can be put in the minute, so thank her if we get it right.

2261
03:32:22,540 --> 03:32:24,260
Or if she gets it right, we look good.

2262
03:32:26,020 --> 03:32:27,160
Supervisor Friend, do you have any more?

2263
03:32:27,400 --> 03:32:32,860
Just briefly, I just wanted to congratulate Colin Dishroon on coming full circle to believe in

2264
03:32:32,860 --> 03:32:34,580
ergonomics. You're doubt to be really proud.

2265
03:32:36,080 --> 03:32:38,440
Triple down apparently works in your industry too.

2266
03:32:38,960 --> 03:32:42,460
But anyway, I appreciate that everybody has stuck it through this long.

2267
03:32:42,560 --> 03:32:48,480
We are getting closer and closer to something as both the state and federal landscapes shift and

2268
03:32:48,480 --> 03:32:55,480
And I appreciate, I fully agree with Supervisor Coonerty's questions, the component on taxation is important,

2269
03:32:55,900 --> 03:32:59,060
but we can't be arbitrarily saying any number, right?

2270
03:32:59,200 --> 03:33:03,660
I mean, right now we're, we're set at a number, but just as some are saying it could be too high, without

2271
03:33:03,660 --> 03:33:05,860
information, we don't know where too low is either.

2272
03:33:06,000 --> 03:33:10,820
We actually need to have a sense through this analysis to really have a sense of how many people

2273
03:33:10,820 --> 03:33:14,420
had impacts and what that would mean for us on the mitigations that we promised.

2274
03:33:14,560 --> 03:33:18,320
Remember, we went to the voters twice and associated with that, we made commitments to

2275
03:33:18,320 --> 03:33:27,100
than that this was associated with mitigating impacts and also providing services for the community in order to have this industry exist and come into the light within Santa Cruz County.

2276
03:33:27,500 --> 03:33:32,620
We have to recognize that the voters overwhelmingly agreed with that and asked us to do exactly what we're doing right now.

2277
03:33:33,140 --> 03:33:40,320
And so therefore I think it's reasonable for us to take a solid look at what that number should be because the voters asked us to do exactly that.

2278
03:33:40,540 --> 03:33:43,500
We committed to them that we'd be providing services associated with this.

2279
03:33:43,700 --> 03:33:46,000
We provided to them that we would also be mitigating impacts.

2280
03:33:46,000 --> 03:33:48,240
That's what we need to be doing, so thank you.

2281
03:33:49,380 --> 03:33:58,420
I know our CAO is concerned about all the other aspects of the recommended actions that may have not have been captured in the original motion.

2282
03:33:58,660 --> 03:34:13,600
Yes, I just wanted to remind you that Supervisor Friend did ask us to assure that both CA and AUses, especially in the coastal zone, do not promote the development of structures on agglans for manufacturing, paying careful attention to the definition of ancillary use.

2283
03:34:13,600 --> 03:34:16,260
So, is that intended to be included in the motion?

2284
03:34:16,480 --> 03:34:19,520
Well, let me say that I believe that the board had already provided that direction.

2285
03:34:19,620 --> 03:34:24,600
The EIR regarding the coastal zone, my statement was by way of extension, this language was vague

2286
03:34:24,600 --> 03:34:27,360
and didn't say anything in general regarding the CA.

2287
03:34:27,540 --> 03:34:30,860
And I thought that was already sort of decided for the coastal zone as far as the EIR went.

2288
03:34:31,680 --> 03:34:36,060
So, I didn't know if you needed that as a formal element as part of the direction.

2289
03:34:36,200 --> 03:34:37,340
I just wanted to make sure that we don't know.

2290
03:34:37,340 --> 03:34:38,320
We'll make sure it's in there.

2291
03:34:38,360 --> 03:34:41,880
We just wanted to make sure you didn't want to include it in your direction at this time.

2292
03:34:42,720 --> 03:34:49,940
So when you're sure it's in there, and then Supervisor Leopold had asked for further review of the indoor and outdoor provisions

2293
03:34:49,940 --> 03:34:52,440
and the manufacturing ordinance, I believe it was-

2294
03:34:52,440 --> 03:34:53,620
No, it was in the personal cultivation.

2295
03:34:54,380 --> 03:34:54,780
And you also-

2296
03:34:54,780 --> 03:34:56,120
Oh, also in the manufacturing.

2297
03:34:56,840 --> 03:34:57,860
Right, you asked for both.

2298
03:34:58,900 --> 03:35:01,000
And we talked about advertising requirements.

2299
03:35:01,680 --> 03:35:05,780
I don't know if there's any additional direction with regard to advertising requirements,

2300
03:35:06,260 --> 03:35:10,480
the flexibility for discretion for the licensing officer and the request for mapping.

2301
03:35:10,480 --> 03:35:12,300
So those were the other items you mentioned.

2302
03:35:12,580 --> 03:35:16,200
If you'd like to include those, we'd be happy to do so.

2303
03:35:16,200 --> 03:35:19,220
Yes, I mean, I think that's, I think you were trying to get some sense of direction.

2304
03:35:19,220 --> 03:35:23,760
I didn't hear anybody speak out against those very issues and so-

2305
03:35:23,760 --> 03:35:28,640
Whether it needs to be a part of the minutes of mean motion, I'll leave to someone else.

2306
03:35:29,040 --> 03:35:29,260
Okay.

2307
03:35:30,520 --> 03:35:31,920
I do want to make a couple of remarks.

2308
03:35:32,220 --> 03:35:37,540
First of all, I want to thank everyone for coming here today and I really appreciate the hard work

2309
03:35:37,540 --> 03:35:44,220
that Mr. Peterson and his staff have put into getting us to where we are today.

2310
03:35:44,940 --> 03:35:48,620
Five months is not a long time, but you've shown that you've been able to advance a lot more

2311
03:35:48,620 --> 03:35:51,620
than we have as a board in six years.

2312
03:35:52,000 --> 03:35:53,320
So thank you for that.

2313
03:35:53,860 --> 03:35:58,860
And you're actually putting sort of meat on the bones of what we're trying to create here.

2314
03:35:59,000 --> 03:35:59,880
And that's not easy.

2315
03:36:01,040 --> 03:36:02,720
It's not easy here in Santa Cruz.

2316
03:36:02,800 --> 03:36:03,860
It's not easy in California.

2317
03:36:03,860 --> 03:36:09,220
It's not easy in this country because of the weird way in which we are doing rulemaking

2318
03:36:09,220 --> 03:36:16,740
and laws, and for us to be able to come up with good information using real data, I support

2319
03:36:16,740 --> 03:36:20,540
that, and I appreciate what you've been able to do.

2320
03:36:21,100 --> 03:36:31,080
I think on this issue of the taxes, we did make assertions to the public, but we also don't

2321
03:36:31,080 --> 03:36:36,220
have, there wasn't a debate about 7% or 5% or 10% in there.

2322
03:36:36,440 --> 03:36:40,240
We gave ourselves the ability to move this by a majority vote of this board.

2323
03:36:41,820 --> 03:36:48,560
And what we're left with is we will, if we wait till August to decide what the tax rate

2324
03:36:48,560 --> 03:36:54,860
should be in 2017, we will have, with the de facto saying it's 777.

2325
03:36:55,300 --> 03:37:00,820
So I think that's, I think we need to come back sooner than that to look at the tax rate

2326
03:37:00,820 --> 03:37:06,520
for this year, and if the staff is unwilling, maybe there are board members who would be willing

2327
03:37:06,520 --> 03:37:09,220
to work and make a suggestion so we could actually have a meaningful discussion.

2328
03:37:09,480 --> 03:37:13,540
I don't think it's agendized today, whether we could have that discussion today or not.

2329
03:37:15,840 --> 03:37:20,760
So that should come back to us, at least to have that discussion, because data makes a difference.

2330
03:37:21,640 --> 03:37:25,560
But we're not going to have enough, as one speaker pointed out, we only have one data

2331
03:37:25,560 --> 03:37:25,880
point.

2332
03:37:25,880 --> 03:37:32,940
It's not a meaningful amount of data, and we're really looking about some policy goals, in my opinion,

2333
03:37:33,420 --> 03:37:37,960
rather than what kind of information we've gotten from a couple of months of activity.

2334
03:37:38,840 --> 03:37:44,340
I will point also out to my colleague that the hotel industry did come into this room and

2335
03:37:44,340 --> 03:37:47,400
did get us to reduce taxes after they brought a lot of people.

2336
03:37:47,400 --> 03:37:59,960
So we had a proposal to move the TOT up to 12% and they came and they threatened us and this board back down.

2337
03:38:02,000 --> 03:38:10,100
So that's not a good model for us to use and we shouldn't have to get me in that kind of confrontation, especially with people who want to work with us.

2338
03:38:10,100 --> 03:38:16,120
The city sales taxes are different because people are asked to increase their sales tax

2339
03:38:16,120 --> 03:38:20,500
in order to get something, and the city of Santa Cruz, the city of Watsonville, public safety

2340
03:38:20,500 --> 03:38:22,760
roads, a whole bunch of other pieces.

2341
03:38:23,780 --> 03:38:27,780
That's what communities should do, and they should ask what they want to do to invest in themselves.

2342
03:38:28,580 --> 03:38:35,740
So those high tax rates are because the communities have chosen to invest in themselves, and I applaud

2343
03:38:35,740 --> 03:38:42,580
those efforts. But it can't be used to say, well, now we want to lower the taxes

2344
03:38:42,580 --> 03:38:47,720
because you went out to the public, you asked them, and they agreed. This is slightly different

2345
03:38:47,720 --> 03:38:55,200
because we basically asked people to give us the ability to go up to a limit. But one could make an argument

2346
03:38:55,200 --> 03:39:02,720
that they gave us the prerogative to make reasonable choices that would reflect the goals that we identified

2347
03:39:02,720 --> 03:39:09,800
in the measure. So I want to do this through collaboration rather than

2348
03:39:09,800 --> 03:39:16,000
confrontation. And I think there's an opportunity to do that. I think we should do

2349
03:39:16,000 --> 03:39:20,340
that and hopefully we'll be able to get to that in a different meeting.

2350
03:39:21,100 --> 03:39:23,740
You know, several people brought up their concerns about what they wanted to see

2351
03:39:23,740 --> 03:39:27,880
in the cultivation ordinance. That's actually not what's on our agenda today. We do,

2352
03:39:28,100 --> 03:39:31,520
we've had a very involved discussion about that. That's why we're doing this

2353
03:39:31,520 --> 03:39:37,820
environmental impact report, as it was discussed, that will come back to us in a first iteration

2354
03:39:38,320 --> 03:39:44,140
at the beginning of June. We'll have a study session on that. We'll talk about what's in the EIR,

2355
03:39:44,500 --> 03:39:48,680
not what it's going to be in the ordinance. We're going to talk about the information.

2356
03:39:49,140 --> 03:39:55,420
Then a final EIR will come out and should we certify it, it will be the document that guides

2357
03:39:55,420 --> 03:40:06,940
what the ordinance will look like. So, stay tuned in September or sometime like that, we will actually be adopting an ordinance and we'll be making changes based on real information.

2358
03:40:08,200 --> 03:40:18,700
I think where this process takes a lot of patience as we found, I think we can continue to move forward.

2359
03:40:18,700 --> 03:40:36,780
I think that what's been laid out here for the manufacturing ordinance is a good start and I think with further refinement that we have an opportunity to craft something based on now our lots of experience with cannabis and the active participation of people involved in the industry to make sure we have an ordinance that really works out.

2360
03:40:37,280 --> 03:40:43,760
So I look forward to seeing that final ordinance when it comes back to us in the coming months.

2361
03:40:43,760 --> 03:40:51,940
If there's no more comments, then I will call for a vote on the motion made by Supervisor

2362
03:40:51,940 --> 03:40:53,640
Community Seconded by Supervisor Friend.

2363
03:40:53,980 --> 03:40:55,660
All in favor, signify by saying aye.

2364
03:40:56,780 --> 03:40:59,160
Any opposed, the motion carries unanimously.

2365
03:41:00,100 --> 03:41:04,300
And with that, we will go into closed session.

2366
03:41:04,920 --> 03:41:08,020
We have a 130 item, but we have a number of items in closed session.

2367
03:41:08,160 --> 03:41:10,260
Will we have anything to report out of that closed session?

2368
03:41:10,400 --> 03:41:12,820
There's a chance that one of the items is reportable.

2369
03:41:12,820 --> 03:41:21,120
Okay. Well, I encourage you to go out lunch and if you want to see what happens with our mid-year budget review, come back at 1.30.

2370
03:41:21,760 --> 03:41:22,120
Thank you.

2371
03:47:59,220 --> 03:48:29,040
is considered a mid-year financial update for fiscal year 2016-17 and conduct a study session of the 2017-18 county proposed budget as outlined in the memorandum of the auditor controller, treasurer, tax collector, and county administrative officer. There's an attachment of the ACTTC mid-year report. And I believe Ms. Morello is starting off. Yes, we're just going to I'm just going to turn it over to Edith Triscoll or auditor controller and Carlos Palacio.

2372
03:48:29,040 --> 03:48:33,180
The Assistant County Administrator will be delivering today's report, close.

2373
03:48:35,900 --> 03:48:36,920
Good afternoon.

2374
03:48:37,920 --> 03:48:38,660
Good afternoon.

2375
03:48:39,360 --> 03:48:40,880
First, we have the agenda for today.

2376
03:48:42,200 --> 03:48:45,640
Auditor control or treasure tax collector will be giving her mid-year report.

2377
03:48:46,380 --> 03:48:50,260
Following that, I'll be giving an overview of the budget at mid-year,

2378
03:48:51,180 --> 03:48:56,840
followed by a preview of some initiatives that we are proposing to include in the budget this year.

2379
03:48:57,780 --> 03:49:03,760
After that, we will have department overviews that include the major emerging issues that they are facing.

2380
03:49:03,920 --> 03:49:06,000
There will be five departments that will be speaking.

2381
03:49:06,780 --> 03:49:15,280
Public works will come up first, then we'll have our public safety, the sheriff, and county fire, and then we'll have health and human services finally.

2382
03:49:16,280 --> 03:49:24,300
And then at the very end, I'll come up and give a summary of next year's challenges and also a preview of next year's budget as well.

2383
03:49:25,100 --> 03:49:27,880
And so following that, we'll go ahead and start.

2384
03:49:30,770 --> 03:49:33,290
Good afternoon, Chair Leopold and members of the Board.

2385
03:49:33,750 --> 03:49:35,010
I'm not sure your back of photos on.

2386
03:49:35,190 --> 03:49:36,110
The green light is on.

2387
03:49:36,710 --> 03:49:36,870
All right.

2388
03:49:37,370 --> 03:49:38,350
I need to put some of the photos on.

2389
03:49:38,350 --> 03:49:39,470
Point it at you.

2390
03:49:40,470 --> 03:49:41,690
All right, I'll start again.

2391
03:49:42,270 --> 03:49:44,530
Good afternoon, Chair Leopold and members of the Board.

2392
03:49:45,110 --> 03:49:47,990
As previously introduced, Edith Triscoll, out of her controller,

2393
03:49:48,490 --> 03:49:50,610
Treasurer Tax Collector for the County of Santa Cruz.

2394
03:49:51,190 --> 03:49:53,590
I'm pleased to provide the Board and the County staff

2395
03:49:53,590 --> 03:49:57,970
with the mid-year financial update for the fiscal year 2016-17.

2396
03:49:58,810 --> 03:50:03,270
In your board's agenda packet you have my mid-year report, this afternoon I'll be highlighting

2397
03:50:03,270 --> 03:50:05,550
that report using some PowerPoint slides.

2398
03:50:08,660 --> 03:50:12,760
I'm beginning today with an overview of the entire budget that your board originally approved

2399
03:50:12,760 --> 03:50:15,660
for the 2016-17 fiscal year.

2400
03:50:16,420 --> 03:50:21,280
The budget presented here is broken down by categories of funds, so we'll discuss each

2401
03:50:21,280 --> 03:50:27,960
category briefly. The general fund, which is budgeted at $400 million, $480 million, you're

2402
03:50:27,960 --> 03:50:33,100
very familiar with as it's frequently discussed here at your board. The special revenue funds

2403
03:50:33,100 --> 03:50:38,540
budgeted at $65 million include housing funds, park identification funds, and the road fund.

2404
03:50:39,580 --> 03:50:44,960
Special district funds budgeted at $50 million are the county service areas including

2405
03:50:44,960 --> 03:50:49,780
providing CSA 48 county fire protection and many of your flood control districts.

2406
03:50:50,620 --> 03:50:56,020
The 96 million budgeted in internal service funds includes the Public Works Department,

2407
03:50:56,840 --> 03:51:01,920
information services department, and the various insurance funds including workers' compensation

2408
03:51:01,920 --> 03:51:03,440
and unemployment insurance.

2409
03:51:04,580 --> 03:51:10,240
And finally, the enterprise fund budgeted at 20 million is related to CSA 9C, the county

2410
03:51:10,240 --> 03:51:16,940
disposal site, and Davenport in Freedom Sanitation, and a few of the other sanitation-related funds.

2411
03:51:18,080 --> 03:51:21,240
The total comes to $711 million as presented here.

2412
03:51:23,040 --> 03:51:33,440
And I seem to have lost an additional slide, but I did want to focus that the county has a strong alliance on federal and state funds, as they make up 41% of that total revenue.

2413
03:51:33,940 --> 03:51:36,520
The total revenue of $711 million.

2414
03:51:37,180 --> 03:51:37,740
There

2415
03:51:44,680 --> 03:51:45,060
we go.

2416
03:51:46,260 --> 03:51:52,720
Continuing to stay focused on the total county revenues, the total county budget, this

2417
03:51:52,720 --> 03:51:55,480
pie chart reflects the sources of total county revenues.

2418
03:51:56,300 --> 03:51:58,460
Intergovernmental revenues are 42%.

2419
03:51:58,460 --> 03:52:02,080
These represent the federal and state funds that I discussed just a moment ago.

2420
03:52:03,060 --> 03:52:06,940
Charges for services and then taxes are the other two large revenue sources.

2421
03:52:08,400 --> 03:52:12,200
I'll go into these in greater detail on further slides in the presentation.

2422
03:52:22,510 --> 03:52:28,590
As you see here, salaries and benefits are the largest expenditure, followed by services and supplies.

2423
03:52:29,270 --> 03:52:36,570
You often hear us refer to the greatest expense of the county as salaries and benefits, and as you see that's 43% if we're looking at the total budget.

2424
03:52:41,310 --> 03:52:42,890
Now onto General Fund revenues.

2425
03:52:43,950 --> 03:52:48,730
The General Fund budget, as we saw in the first slide, is budgeted at $480 million.

2426
03:52:48,730 --> 03:52:55,290
Since the beginning of the year, your board has accepted additional revenue bringing the budget to 481 million.

2427
03:52:58,150 --> 03:53:05,030
For the general fund, federal and state money make up 51%, that's the category listed here as Intergovernmental Aid.

2428
03:53:05,570 --> 03:53:09,850
So more than 50% of your general fund budget is federal and state funds.

2429
03:53:10,890 --> 03:53:17,530
The tax area includes not only property tax but also your TOT and CBT.

2430
03:53:19,050 --> 03:53:22,370
transit occupancy tax and cannabis business tax.

2431
03:53:28,400 --> 03:53:32,620
This slide reflects the status of meeting our general fund revenue budget.

2432
03:53:33,380 --> 03:53:38,900
For the first seven months of the fiscal year, we received 42% of the budgeted amount

2433
03:53:38,900 --> 03:53:40,720
of the total general fund revenues.

2434
03:53:42,400 --> 03:53:48,180
This exceeds receipts received in the comparable period of the prior year when only 38% of

2435
03:53:48,180 --> 03:53:49,920
the budgeted revenues had been received.

2436
03:53:51,720 --> 03:53:55,480
Intergovernmental aid from state and federal government is the largest revenue source for

2437
03:53:55,480 --> 03:53:56,920
the general fund, as I just mentioned.

2438
03:53:57,780 --> 03:54:01,980
To date, 36% of budgeted intergovernmental revenues have been received.

2439
03:54:02,680 --> 03:54:06,700
This exceeds the prior year comparable period of only 32% being received.

2440
03:54:07,360 --> 03:54:12,140
These revenues traditionally lag during the year because they're tied to expenditures, and

2441
03:54:12,140 --> 03:54:13,620
are paid on a reimbursement basis.

2442
03:54:13,880 --> 03:54:17,940
Departments submit to claims, and later in the year or potentially in the following year

2443
03:54:17,940 --> 03:54:18,920
we received those funds.

2444
03:54:20,120 --> 03:54:24,800
These general fund intergovernmental revenues very slightly from the total county revenues

2445
03:54:24,800 --> 03:54:29,480
regarding their fund and state mix, showing that we have a greater reliance on federal

2446
03:54:29,480 --> 03:54:31,080
and state funds for the general fund.

2447
03:54:33,040 --> 03:54:38,520
As of January 31st, 2017, we have received 52 percent of the budgeted amount of total tax

2448
03:54:38,520 --> 03:54:42,640
revenues, which is similar to this time last year when we have received 52 percent.

2449
03:54:43,440 --> 03:54:49,680
This year, the county has received a one-time final clean-up payment in the triple payment—excuse

2450
03:54:49,680 --> 03:54:53,820
me, triple-flip payment—from the state of California in the amount of a million three.

2451
03:54:54,920 --> 03:54:57,900
Detailed receipts of tax revenues are provided on the next slide.

2452
03:55:02,960 --> 03:55:04,020
General fund taxes.

2453
03:55:04,500 --> 03:55:07,080
This graph provides a breakdown of the tax receipts.

2454
03:55:08,950 --> 03:55:13,910
The county contracts with HDO and associates to perform sales tax monitoring and reporting.

2455
03:55:13,910 --> 03:55:20,770
You'll see here that sales tax represents 8% of our budgeted revenues.

2456
03:55:22,150 --> 03:55:28,930
The county, Santa Cruz County saw a decrease of 0.6% over the comparable time period from

2457
03:55:28,930 --> 03:55:31,870
prior year according to HDL's most recent report to us.

2458
03:55:32,570 --> 03:55:40,310
Actual sales activity grew 1.5%, but when reporting abbreviations were factored out, it was reduced to 0.6.

2459
03:55:41,210 --> 03:55:44,650
The central coast region as a whole is up 2.2%.

2460
03:55:46,970 --> 03:55:54,570
Additionally, looking at this slide, you can see property checks is equal 52% of the total revenue brought in, budgeted.

2461
03:55:59,950 --> 03:56:07,730
Comparing these tax revenues for the first seven months of the year to the same seven months of the previous year, you can see our receipts are slightly ahead of where we were.

2462
03:56:11,820 --> 03:56:18,880
And again, you'll notice in the sales tax and new category that reflects the one-year, the one-time payment we received this year, the payoff amount.

2463
03:56:18,880 --> 03:56:26,590
The county's property tax delinquency rate is a key element in highlighting to highlight

2464
03:56:26,590 --> 03:56:28,110
when reviewing property tax revenues.

2465
03:56:28,590 --> 03:56:31,850
For fiscal year, 1516, the rate was 2.3%.

2466
03:56:32,460 --> 03:56:36,630
The delinquency rate has been on decline for several years, which is very important to

2467
03:56:36,630 --> 03:56:36,970
the county.

2468
03:56:37,790 --> 03:56:40,590
Higher delinquency rates create a cash flow issue for the county.

2469
03:56:41,350 --> 03:56:45,790
However, the county does eventually receive the taxes, penalties, and interest when the property

2470
03:56:45,790 --> 03:56:47,470
is sold or brought current.

2471
03:56:48,910 --> 03:56:52,330
San Chris County is on the teeter plan for porting property taxes.

2472
03:56:52,810 --> 03:56:57,830
The teeter plan allows the county to distribute taxes to cities and special districts based

2473
03:56:57,830 --> 03:57:00,270
on their calculated share of the property tax role.

2474
03:57:01,010 --> 03:57:06,070
This allows cities and special districts to rely on a definite amount of tax revenue with

2475
03:57:06,070 --> 03:57:11,110
the county absorbing the risk of delinquencies along with retaining the late penalties and

2476
03:57:11,110 --> 03:57:12,210
delinquency assessments.

2477
03:57:16,310 --> 03:57:18,910
Now we'll switch focus to the general fund expenditures.

2478
03:57:19,750 --> 03:57:22,730
This graph reflects categories of general fund expenditures.

2479
03:57:23,430 --> 03:57:27,610
Sours and benefits are almost 50% of general fund expenses.

2480
03:57:34,330 --> 03:57:37,430
How is the county performing compared to budget regarding expenditures?

2481
03:57:38,150 --> 03:57:41,710
This slide will provide you information for the first seven months of the fiscal year.

2482
03:57:42,610 --> 03:57:48,070
As reflected above, 53% of sours and benefits have been expended,

2483
03:57:48,070 --> 03:57:50,170
which is reasonable at this point in the fiscal year.

2484
03:57:50,170 --> 03:57:51,090
This

2485
03:57:56,660 --> 03:58:01,960
next graph reflects the board's progress towards reaching a 10% general fund reserve goal.

2486
03:58:02,620 --> 03:58:07,620
Your board's fund balance reserve policy strives to reach 10% by 2021.

2487
03:58:08,820 --> 03:58:14,220
The first three years reflected on the left are rates that are reported based on final

2488
03:58:14,220 --> 03:58:19,100
CAFRA amounts. The final calculation on the right is based on the adopted budget.

2489
03:58:20,340 --> 03:58:24,400
The county's reserve policy has helped the county maintain a strong fiscal position

2490
03:58:24,400 --> 03:58:26,360
and whether negative economic trends.

2491
03:58:32,180 --> 03:58:35,060
Having a strong gem of fund benefits the county's ratings

2492
03:58:35,060 --> 03:58:35,960
for borrowing.

2493
03:58:36,420 --> 03:58:38,780
The county maintains both short and long-term ratings

2494
03:58:38,780 --> 03:58:40,660
from standard and poor's and moody's.

2495
03:58:41,060 --> 03:58:43,260
The long-term ratings I'll highlight here,

2496
03:58:43,740 --> 03:58:44,960
I don't have a slide for this.

2497
03:58:45,440 --> 03:58:48,020
Standard and poor's, we currently have a AA negative rating

2498
03:58:48,440 --> 03:58:50,080
and moody's we have an A1.

2499
03:58:50,780 --> 03:58:55,720
In October of 2016, Moody's did a review of our rating

2500
03:58:55,720 --> 03:58:58,060
and upgraded us from an A2 to an A1.

2501
03:58:58,060 --> 03:58:58,980
The

2502
03:59:02,430 --> 03:59:06,290
information I just presented is available on the County Auditor Controller's website.

2503
03:59:06,870 --> 03:59:11,430
Both county budget documents as well as many different annual financial statements

2504
03:59:11,430 --> 03:59:17,520
and the CAFR are shown here on my website and highlighted with the red arrows.

2505
03:59:18,760 --> 03:59:22,020
Additionally, we have a new item we want to highlight and we're shown to you today.

2506
03:59:22,720 --> 03:59:25,780
The Auditor Controller's office is continuing to focus on transparency

2507
03:59:25,780 --> 03:59:29,580
and providing current fiscal information to citizens and staff.

2508
03:59:29,580 --> 03:59:33,940
We're pleased to introduce to you an online financial tool called EasyGov.

2509
03:59:34,560 --> 03:59:36,320
The tool is available here on the site.

2510
03:59:43,760 --> 03:59:48,480
The tool will continue to modify, the county will continue to modify the tool to include

2511
03:59:48,480 --> 03:59:54,480
predefined graphs as users' request things, such as COT or CBT taxes or budget to actual.

2512
03:59:55,360 --> 03:59:59,900
The tool provides data to users in various forms from charts, graphs, or principal reports.

2513
04:00:00,370 --> 04:00:16,150
The users log in and define the type of data they want to receive. Again, budget to actual. Data is updated quarterly. So the benefit of this tool is you'll be able to see how we're doing on a quarterly basis and citizens can access this without needing to do a public records request.

2514
04:00:21,540 --> 04:00:34,560
In summary, general fund revenues are at 42.28% of budget and expenditures are at 49.8% of budget. Current year expenditures are as expected at this point in the fiscal year, although revenues lag behind.

2515
04:00:34,560 --> 04:00:38,960
Both revenues and expenditures are similar to last year at this seven-month period.

2516
04:00:39,800 --> 04:00:41,780
Property tax delinquencies remain stable.

2517
04:00:42,560 --> 04:00:46,820
Care must be taken in the upcoming budget year to ensure that expenditures do not outpace

2518
04:00:46,820 --> 04:00:51,180
revenues, and that fund balance amounts continue to follow the county policy.

2519
04:00:52,100 --> 04:00:54,660
Thank you for providing me with the opportunity to present this report.

2520
04:00:56,280 --> 04:01:00,240
I'm going to see if Board members have any questions about this report.

2521
04:01:00,820 --> 04:01:06,020
Or you may want to consider listening to the CEO's presentation and combining your questions,

2522
04:01:06,140 --> 04:01:06,880
whichever you prefer.

2523
04:01:07,280 --> 04:01:09,560
Let's just see if anybody has any quick question.

2524
04:01:10,000 --> 04:01:10,480
A brief one.

2525
04:01:11,080 --> 04:01:16,580
Under the general fund expenditure, expenditures, there's a 15 percent pi called other charges.

2526
04:01:16,820 --> 04:01:17,540
You didn't say what that is.

2527
04:01:17,620 --> 04:01:22,500
Can you just give me a sort of a highlight of what would make up one seventh of that of our total pi here?

2528
04:01:23,040 --> 04:01:25,360
So you have salaries and benefits, services, and plies, I get that.

2529
04:01:25,820 --> 04:01:26,360
Other charges.

2530
04:01:30,750 --> 04:01:33,230
I am going to take input from the CAOs.

2531
04:01:33,370 --> 04:01:38,210
It includes a lot of contracts and contract payments like menu programs, things like that.

2532
04:01:38,390 --> 04:01:43,730
I believe that's also where we reflect some of the debt service payments and the like, but I'm not sure.

2533
04:01:44,570 --> 04:01:46,630
You can just give that information to me later, that would be happy to.

2534
04:01:46,750 --> 04:01:47,010
Thank you.

2535
04:01:47,990 --> 04:01:49,690
I also just one quick question.

2536
04:01:50,630 --> 04:01:54,970
You mentioned that this year was the last year of the triple-flip pay.

2537
04:01:54,970 --> 04:01:55,130
Correct.

2538
04:01:56,030 --> 04:02:00,230
Those were funds that the state owed us it hadn't paid.

2539
04:02:00,610 --> 04:02:00,750
Correct.

2540
04:02:01,330 --> 04:02:02,810
Did they still owe us any more money?

2541
04:02:05,070 --> 04:02:05,310
No.

2542
04:02:06,490 --> 04:02:07,810
Right, that was the true up.

2543
04:02:07,970 --> 04:02:08,990
Yeah, that was the true up.

2544
04:02:09,190 --> 04:02:09,590
It was the final payment.

2545
04:02:09,590 --> 04:02:10,170
That was the final payment.

2546
04:02:10,630 --> 04:02:14,210
All right, well then let's continue Mr. Flosios.

2547
04:02:24,200 --> 04:02:24,440
OK.

2548
04:02:26,000 --> 04:02:29,080
Looking at the mid-year budget, and this

2549
04:02:29,080 --> 04:02:31,140
is going to sound strange given all the things

2550
04:02:31,140 --> 04:02:34,180
that we're facing at the state and national level at this time

2551
04:02:34,180 --> 04:02:39,960
and given all the storm impacts. Right now we are actually doing pretty good, and that's

2552
04:02:39,960 --> 04:02:46,320
a testament to a few things. One is that our revenue growth has been modest, but it

2553
04:02:46,320 --> 04:02:53,180
has been steady. And the other factors that we have been vigilant in controlling our expenditures,

2554
04:02:54,400 --> 04:03:00,500
and therefore our revenue growth has been able to keep pace with our expenditures, and in

2555
04:03:00,500 --> 04:03:07,860
even surpassed that. And so that's all good news. And I think the board deserves a lot of credit for that

2556
04:03:09,400 --> 04:03:13,420
for maintaining our expenditures in a way that is

2557
04:03:13,420 --> 04:03:18,320
below our revenue growth. Now the danger that is that we are facing

2558
04:03:21,140 --> 04:03:27,020
some storm clouds on the horizon. And we know that these are very serious

2559
04:03:27,020 --> 04:03:29,720
challenges that await us in the future.

2560
04:03:30,740 --> 04:03:35,020
One is that the economic recovery that we are currently in is slowing.

2561
04:03:36,140 --> 04:03:46,160
We know that the state budget contains significant risks for the county and we're going to talk about this later in particular with the in-home supportive services, actions that the governor has taken.

2562
04:03:47,100 --> 04:03:55,800
We know at the federal level that there's lots of movement on the Affordable Care Act, which could have severe ramifications both for our community but also for our budget.

2563
04:03:56,820 --> 04:04:06,120
We know that we have significant deferred maintenance and infrastructure needs, which has been compounded by the storm impacts we've had it to our roads.

2564
04:04:06,980 --> 04:04:17,680
And so those three things, state issues, federal issues, are storm impacts, and then a possible economic slowdown in the future all make us a little bit nervous.

2565
04:04:18,080 --> 04:04:23,460
And so that when we want to keep making progress towards our reserves, which your board has done every year.

2566
04:04:23,460 --> 04:04:28,860
And we are on track to reach the 10% goal that your board has set for us.

2567
04:04:30,140 --> 04:04:31,720
So we look at the governor's budget.

2568
04:04:32,380 --> 04:04:36,320
Mainly the governor has emphasized fiscal restraint and being conservative.

2569
04:04:37,120 --> 04:04:42,440
He's emphasizing both strange state reserves, keeping the budget balanced,

2570
04:04:42,760 --> 04:04:44,480
maintaining expenditure control.

2571
04:04:45,480 --> 04:04:51,280
And unfortunately, he also took the action of shifting and

2572
04:04:51,280 --> 04:04:53,140
I don't support services cost to counties.

2573
04:04:54,400 --> 04:04:59,960
We know that he's doing this partly because of a potential coming recession.

2574
04:05:01,620 --> 04:05:05,640
After the great recession which took place in 2008 and

2575
04:05:05,640 --> 04:05:09,340
2009, we have been in an eight year recovery right now.

2576
04:05:09,420 --> 04:05:11,540
We're in our eight year of recovery since that recession.

2577
04:05:12,460 --> 04:05:15,920
And the average length of a recovery is typically five years.

2578
04:05:17,020 --> 04:05:19,280
So we're three years beyond the average.

2579
04:05:19,280 --> 04:05:32,040
So that makes us nervous a little bit, and I think that makes the governor nervous that we're past due so to speak for a recession, and we have seen that the economy is slowing down somewhat.

2580
04:05:33,820 --> 04:05:42,560
Looking at the economy, unemployment rates are good, this is probably the lowest, I think, since before the great recession.

2581
04:05:42,560 --> 04:05:48,300
You can see in November of 2016, we're 6% unemployment, which is very low for this county.

2582
04:05:49,180 --> 04:05:55,800
It's slightly above California and the national averages, but that's mainly due to the agricultural industry and

2583
04:05:55,800 --> 04:05:58,840
the characteristics of employment in that industry.

2584
04:05:59,440 --> 04:06:02,240
And so we're always going to be a little higher than the state and national averages.

2585
04:06:02,460 --> 04:06:06,560
But it's actually good news in terms of the strength of our economy.

2586
04:06:07,640 --> 04:06:12,060
Looking at the economic forecast, what I would say is that it's modest.

2587
04:06:12,060 --> 04:06:17,480
but positive. That's the good news. It's still moving in a positive direction. It's slowing,

2588
04:06:17,920 --> 04:06:22,760
it's modest, but it's positive. Job growth, less than a percent, but it's growing.

2589
04:06:23,580 --> 04:06:31,240
Saur is expected to increase by about 3% this year. Population under a percent. Real per

2590
04:06:31,240 --> 04:06:37,500
capita income expected to increase by about 3%. And so all of these trends point to modest

2591
04:06:37,500 --> 04:06:42,340
increased in our tax revenue, and our tax revenue for our general fund is very important.

2592
04:06:44,460 --> 04:06:49,180
So if we look at our main primary revenue growth and in particular taxes,

2593
04:06:51,220 --> 04:06:58,340
this is part of the good news that we are now projecting that we will come in about $3.6 million

2594
04:06:59,020 --> 04:07:05,160
ahead of our budget, that's about 3% and we're led by property taxes.

2595
04:07:05,660 --> 04:07:12,940
property taxes still increasing, other taxes slowing a little bit, and you'll note that

2596
04:07:12,940 --> 04:07:18,100
the cannabis tax there is a little bit under what we projected mainly due to the cannabis

2597
04:07:18,100 --> 04:07:22,840
too, cultivation. At this point, we really have seen very little revenue from the cultivation.

2598
04:07:23,020 --> 04:07:27,380
Now, we just don't have data on that. We don't know, I know that we just had that conversation

2599
04:07:27,380 --> 04:07:33,280
with our cannabis licensing official, and it's possible that we could have, it could

2600
04:07:33,280 --> 04:07:34,680
It's going to be very cyclical, right?

2601
04:07:34,920 --> 04:07:38,680
And that could show up and we could meet the budget in the end of the day.

2602
04:07:38,760 --> 04:07:43,980
But right now, it's, we're a little concerned on the lack of registrations and the lack of payments.

2603
04:07:44,380 --> 04:07:47,680
But be that as it may, we're still running positive.

2604
04:07:49,680 --> 04:07:55,160
If you look at our overall general fund budget, you'll see that when, in the left hand column,

2605
04:07:55,300 --> 04:07:59,180
this is 16, 17 budget, you'll see that when we adopted that budget,

2606
04:07:59,180 --> 04:08:02,960
that we had a 8 million, 8.1 million dollar net county cost.

2607
04:08:03,620 --> 04:08:06,640
We've also characterized that in the past as the structural deficit.

2608
04:08:07,760 --> 04:08:12,980
$8 million dollars, while it's significant, and then you have to put it in context.

2609
04:08:12,980 --> 04:08:18,280
If you look at it as a percentage of total expenditures, it's only about 2% of the general fund.

2610
04:08:19,100 --> 04:08:23,560
If you look at it as a percent of departmental net county cost, it's about 6%.

2611
04:08:24,120 --> 04:08:28,780
So it's not huge, but it is, of course, always a concern.

2612
04:08:28,780 --> 04:08:32,500
Although it's very common for counties to have a structural deficit of some kind.

2613
04:08:32,700 --> 04:08:37,280
We've been meeting that structural deficit by fund balance, basically, every year, and that's how we funded this.

2614
04:08:38,080 --> 04:08:50,600
The good news is that we are projecting that we're going to make up that net county cost by both increased general purpose revenues of about $5 million.

2615
04:08:51,340 --> 04:08:55,940
And our departmental net county cost is down by about $3 million, this is the projections.

2616
04:08:55,940 --> 04:09:05,520
And so we basically are projecting that we're eight million dollars to the good so that net county costs and this this current mid year, we're gonna make it up.

2617
04:09:07,570 --> 04:09:15,010
If you look at our department net county costs, it's I think it's an important thing for us to keep in mind.

2618
04:09:15,770 --> 04:09:25,770
We start the budget as our treasure tax collector auditor controller pointed out with over $700 million.

2619
04:09:26,530 --> 04:09:30,290
And then you take out a bunch of the special district and enterprise funds,

2620
04:09:30,430 --> 04:09:34,370
internal service funds and so forth, and you get down to the general fund of about $480 million.

2621
04:09:35,070 --> 04:09:40,630
And then out of that, you take out those expenditures, which are directly related to a revenue production.

2622
04:09:41,130 --> 04:09:44,590
And you get down to the net county cost of about $128 million.

2623
04:09:46,190 --> 04:09:55,630
And that is typically what a board supervisors would say is really what the discretionary nut at the core of the county budget is.

2624
04:09:55,630 --> 04:10:08,330
But then you look at that and you see that over half of that is public protection, so that's to share of the jail, public, the district attorney, probation, so forth.

2625
04:10:08,930 --> 04:10:23,530
And then if you add the health and sanitation and to public assistance and you get to about 17% and so if you add the 17% to the 57%, pretty soon you're at 74% to the budget.

2626
04:10:23,530 --> 04:10:29,310
which is leaves you with a pretty small, truly discretionary amount.

2627
04:10:30,170 --> 04:10:33,070
And then when you look at that discretionary amount, that so-called discretionary amount,

2628
04:10:33,190 --> 04:10:36,910
a lot of it is state mandates, such as our assessor, for example, or

2629
04:10:36,910 --> 04:10:39,870
our auditor controller office, our elections office, and so forth.

2630
04:10:40,330 --> 04:10:46,310
And so that's why even though we have a large budget, over $700 million, our room to maneuver is relatively limited.

2631
04:10:46,490 --> 04:10:50,970
And that's why we try and be very vigilant in watching expenditures.

2632
04:10:52,370 --> 04:10:57,390
I'd like to present to you now a few things that are looking forward towards this year's

2633
04:10:57,390 --> 04:10:59,250
proposed budget that we will be including.

2634
04:10:59,630 --> 04:11:04,830
The first two things will be a new budget and CIP format, that's our capital improvement

2635
04:11:04,830 --> 04:11:05,890
plan.

2636
04:11:06,810 --> 04:11:13,710
And then we will also be proposing three initiatives, strategic planning, performance measurement,

2637
04:11:13,930 --> 04:11:15,470
and continuous process improvement.

2638
04:11:15,470 --> 04:11:24,710
And that would be proposed in the budget and if your board approves them, adopts them, then they would be initiated in the coming fiscal year.

2639
04:11:25,530 --> 04:11:27,010
So let me get in a little bit of detail.

2640
04:11:28,650 --> 04:11:37,150
The budget is really the board's method for setting priorities, for setting its values really.

2641
04:11:37,830 --> 04:11:40,730
It's a most important policy document that you do.

2642
04:11:41,710 --> 04:11:51,990
The other thing that a budget is, is it's a communication document, it's really how we communicate to the public about not only how we spend our money, but what our priorities are.

2643
04:11:53,250 --> 04:12:00,730
And so our staff wanted to do something in terms of making the budget more easily understood.

2644
04:12:01,590 --> 04:12:07,190
We wanted to focus on clarity, consistency, ease of understanding for the public.

2645
04:12:08,070 --> 04:12:13,610
So we looked at pretty much almost every county budget in the state and a lot of city budgets.

2646
04:12:13,930 --> 04:12:16,890
And what we did is we took the best of what we saw.

2647
04:12:17,150 --> 04:12:18,310
We took best practices.

2648
04:12:18,550 --> 04:12:23,710
We thought what are the things that are the best way of presenting information,

2649
04:12:23,990 --> 04:12:27,630
complex information, and incorporated into a template.

2650
04:12:27,850 --> 04:12:31,570
And so this is the preview of what the template will look like in this year's proposed budget.

2651
04:12:31,570 --> 04:12:35,550
It has 12 common elements that will be shared by all departments.

2652
04:12:37,490 --> 04:12:43,890
And we'll be consistent within every department so that hopefully the public will find it easier to understand.

2653
04:12:45,190 --> 04:12:52,910
It'll also, the budget will also be centered on functional groups so that we will take now our budget as opposed to doing it alphabetically.

2654
04:12:52,910 --> 04:12:59,290
We will be doing it by functional groups, for example, health and human services, public safety, planning and

2655
04:13:01,270 --> 04:13:09,810
So we hope that when we come forward on this, that it will be something that your board really enjoys and that the public will enjoy in terms of understanding the budget.

2656
04:13:10,470 --> 04:13:14,790
We also are going to be including a new format for our capital improvements program.

2657
04:13:15,630 --> 04:13:25,430
This will be a section of the proposed budget. It will capital assets will be divided into plant and infrastructure plant.

2658
04:13:25,430 --> 04:13:31,390
We'll have every project that we're proposing to fund in the budget document itself.

2659
04:13:32,110 --> 04:13:53,370
And then some of our bigger projects we will have highlighted similar to the description on the right with the, you can see how it has pictures, project names, description, and it has funding as well included in the proposed budget as well as in completion date and future allocations as well for major projects.

2660
04:13:56,530 --> 04:14:00,170
We'll also be proposing three initiatives in the budget.

2661
04:14:01,050 --> 04:14:14,690
One is strategic planning, strategic planning really allows the board to set long-term priorities to really set a long-term focus for the county organization as a whole.

2662
04:14:15,250 --> 04:14:18,450
It also allows the board to get in front of the budget.

2663
04:14:18,450 --> 04:14:25,910
And often the board would may feel that you're at the back end of the budget process.

2664
04:14:26,130 --> 04:14:34,630
Typically, a strategic planning process would be done in the summer and fall prior to the work on the budget.

2665
04:14:34,770 --> 04:14:38,230
And then the strategic plan would then drive the budget process and

2666
04:14:38,230 --> 04:14:43,550
incorporate your priorities and values so forth in that document.

2667
04:14:43,550 --> 04:14:48,970
Again, the other thing that, and here's a couple of examples, this is San Diego and

2668
04:14:48,970 --> 04:14:54,730
Alameda counties, this is their overarching goals, their vision, mission statements, and

2669
04:14:54,730 --> 04:14:55,530
their overarching goals.

2670
04:14:56,330 --> 04:14:59,830
And then you'll see this is an example from Yolo and

2671
04:15:00,000 --> 04:15:29,980
So after they set these overarching goals, for example, in yellows, which is the blue one, they have overarching goal, thriving residents, and then under that, they have goals and objectives, for example, implement the Community Health Improvement Plan as one of the goals and objectives. And then they have homeless reduction, homelessness reduction as another goal. This then would allow you to drive the budget and then eventually start performing

2672
04:15:29,980 --> 04:15:36,600
performance measurement, and this is San Diego, where they have an overarching goal of operational excellence,

2673
04:15:36,780 --> 04:15:39,700
for example, and then they have specific goals.

2674
04:15:39,700 --> 04:15:44,420
This is related to the district attorney as part of the San Diego County, and

2675
04:15:44,420 --> 04:15:47,880
then they have performance measures that are driven by those goals.

2676
04:15:48,660 --> 04:15:52,940
And so once you've adopted a strategic plan, it hopefully drives your budget and

2677
04:15:52,940 --> 04:15:58,660
then eventually on the back end leads you to develop a performance measurement program.

2678
04:15:58,660 --> 04:16:07,860
And again, this is not a quick effort, this is multiple years that we take, you're talking a few years just to get it going and to get it fully implemented.

2679
04:16:07,920 --> 04:16:13,980
I think you probably need three years to really get to the point of doing performance measurement, but I think it's a very worthy, worthy goal.

2680
04:16:15,920 --> 04:16:21,980
Another initiative that we are going to include as a proposal in the budget is continuous process improvement.

2681
04:16:22,520 --> 04:16:25,580
This relates to how do we improve the delivery of our services.

2682
04:16:27,600 --> 04:16:33,360
We know that that is always an issue with every organization both in the private and public sector.

2683
04:16:34,240 --> 04:16:41,220
This process was actually initiated after World War II and by Toyota when they actually,

2684
04:16:41,360 --> 04:16:44,500
that's how they approved their production facilities after World War II,

2685
04:16:44,600 --> 04:16:50,060
was actually an American professor who came up with this method of performance, a process improvement.

2686
04:16:50,060 --> 04:16:58,080
And locally, Granite Rock, they've won the Ball Bridge Award a number of times based on this very same process.

2687
04:16:58,360 --> 04:17:03,280
And I've attended a few of their classes that they've given on this as well.

2688
04:17:04,060 --> 04:17:08,080
And so it's basically a ground bottom up process, not a top down.

2689
04:17:08,080 --> 04:17:11,220
It's not a consultant coming in and saying, here's how you do things better.

2690
04:17:11,360 --> 04:17:16,800
It's really getting our employees to give their ideas about how to improve our processes.

2691
04:17:17,580 --> 04:17:24,940
It's giving employees the time and the structure to have the input and how to improve our service delivery.

2692
04:17:25,760 --> 04:17:32,400
And again, this is an example on the screen of a number of jurisdictions that have done continuous process improvement.

2693
04:17:33,780 --> 04:17:41,700
And it is something again that will take a number of years to implement, but I think is again another worthy goal to pursue.

2694
04:17:42,860 --> 04:17:46,200
So that concludes the first part of my presentation.

2695
04:17:46,560 --> 04:17:50,980
I'll come back at the end and provide a preview of next year's budget.

2696
04:17:51,660 --> 04:17:56,080
But at this point, I'm open to questions, and then if not, we'll get into the departmental presentations.

2697
04:17:56,880 --> 04:17:58,080
All right, questions.

2698
04:17:58,500 --> 04:17:59,640
Supervisor Coonerty looks eager.

2699
04:18:00,160 --> 04:18:02,500
Sure, so first of all, thank you for this.

2700
04:18:02,580 --> 04:18:06,640
I think it's really transparent and it's moving in a good direction.

2701
04:18:06,640 --> 04:18:10,660
I know it's going to take a while to get there, but I'm excited that we're moving.

2702
04:18:10,660 --> 04:18:11,680
We're heading this direction.

2703
04:18:12,380 --> 04:18:16,060
One of the things we talked about was the possibility of starting to look at two-year budgets.

2704
04:18:16,580 --> 04:18:25,660
Recognizing we have to do a budget every year, but that basically you free up staff to do performance measurement in the off year.

2705
04:18:26,560 --> 04:18:30,800
What do you, and San Mateo and Moran and other counties have moved in that direction?

2706
04:18:31,020 --> 04:18:32,520
What do you think about that going forward?

2707
04:18:33,100 --> 04:18:37,840
One structure that we looked at that we thought was very promising is during a multi-year strategic plan.

2708
04:18:37,840 --> 04:18:48,580
And so five to six year strategic plan over arching goals and then two year operational plans where you get down to the goals and objectives and two year timeframes and then tying that two year operational plan to two year budget.

2709
04:18:49,320 --> 04:18:49,520
Okay.

2710
04:18:50,900 --> 04:18:51,500
That's great.

2711
04:18:51,900 --> 04:18:53,820
And look forward to heading that direction.

2712
04:18:53,960 --> 04:18:59,920
And then the second piece is I like how you're starting to group the departments by sort of the service area.

2713
04:19:00,240 --> 04:19:07,180
I'd also encourage that when we look at the metrics that actually we don't just look at department by department.

2714
04:19:07,180 --> 04:19:22,140
There are metrics because so many of the problems in our community require a number of different departments to work together that we figure out what those within that area, what our goals are, and then everyone, each department can play a role in that.

2715
04:19:22,340 --> 04:19:28,840
I understand this is taking steps, but that's where I'd like to end up.

2716
04:19:29,500 --> 04:19:53,540
And the third one is, I think just because there's so many department heads in the room, I think one of the things that will be interested in a budget time is, when you're doing your presentations, what do you plan to do that's risk or an innovation that we will understand may not work in the following year, but sort of how are you building innovation into your department and something you're going to try.

2717
04:19:53,540 --> 04:20:05,260
So just as a heads up, when we're heading towards June, I think I'm going to be asking all the departments to present what that looks like within their department.

2718
04:20:05,440 --> 04:20:10,580
So starting talking to your managers and supervisors and line level staff would you want to do.

2719
04:20:11,300 --> 04:20:12,160
But thank you.

2720
04:20:14,810 --> 04:20:15,090
Questions?

2721
04:20:16,250 --> 04:20:20,510
Yeah, I think it's reassuring to hear that, you know, we're holding steady.

2722
04:20:21,530 --> 04:20:42,750
Generally, though, I have never gone into a budget session with more uncertainty, and it's not because of what we are doing, but what the federal government, especially with the Affordable Care Act, may or may not do, and then with the IHSS situation that if unchanged, will mean what about $3 million to our county?

2723
04:20:43,930 --> 04:20:51,670
The IHSS, yes, we're going to hear more about that, but it could be $39 in sort of the

2724
04:20:51,670 --> 04:20:52,490
worst case scenario.

2725
04:20:54,750 --> 04:21:01,350
Yeah, it's just kind of the uncertainty of it all is troubling, but it's reality as

2726
04:21:01,350 --> 04:21:01,550
well.

2727
04:21:01,910 --> 04:21:08,010
And we won't know that until probably the spring anyway until the May revise, certainly

2728
04:21:08,010 --> 04:21:08,690
from the state.

2729
04:21:09,650 --> 04:21:20,210
I do understand though that we are making efforts to the counties throughout the state to get the governor to reassess his IHS's decision.

2730
04:21:21,450 --> 04:21:29,330
With the reserve accounts, it's hard to gauge maybe when you go up a notch on the ratings and all.

2731
04:21:29,490 --> 04:21:31,030
How much that actually saves you.

2732
04:21:31,030 --> 04:21:44,350
But can you give any, you know, if we're, we were, we were down at 7% for a while at a long time for five years ago anyway, we're up over nine now.

2733
04:21:44,590 --> 04:21:55,390
How much is that? I don't know. How do you measure that? How good that is for us to do this? Because I think it's hard to explain to people when you have so many needs, the value of us having to reserve.

2734
04:21:56,970 --> 04:21:58,030
Certainly, I'll answer that.

2735
04:21:58,250 --> 04:22:01,950
There is not a definite answer that we get from rating agencies.

2736
04:22:02,590 --> 04:22:05,170
We tend to get the negative answer if we're too low.

2737
04:22:05,630 --> 04:22:09,610
Mary Jo Walker, who was in this position before I was, when she was beginning to work with

2738
04:22:09,610 --> 04:22:13,570
you on the reserve policy, was beginning to get indications from the rating agencies that

2739
04:22:13,570 --> 04:22:14,310
we were too low.

2740
04:22:14,850 --> 04:22:18,530
And that's when you began the process of going to 7% and now to 10%.

2741
04:22:19,450 --> 04:22:24,490
When we hear back from rating agencies this past year, we went out and did many refinances.

2742
04:22:25,070 --> 04:22:29,610
They will tell us the thing that will make your rating go higher, is if you have more reserves,

2743
04:22:30,390 --> 04:22:33,930
if it goes lower, if you have less, they won't give you a finite answer.

2744
04:22:34,350 --> 04:22:39,010
The one thing that we can do for you the next time we go out is pay attention if, at the same

2745
04:22:39,010 --> 04:22:44,550
time, that we're issuing debt if there happens to be another entity who has a lower rating,

2746
04:22:44,650 --> 04:22:49,710
that's issuing debt, but it's not something we can just get a number for.

2747
04:22:49,710 --> 04:22:55,510
Yeah, and you know I was when I was looking at the budget and we'll get into more details

2748
04:22:55,510 --> 04:23:01,010
and housing and all I was just seeing how this housing problem with the high prices and

2749
04:23:01,010 --> 04:23:08,590
I think just as today or yesterday the median price was over $100,000 which conflictuated

2750
04:23:08,590 --> 04:23:14,410
with one high price sale I know but I just looked at what California had been doing and

2751
04:23:14,410 --> 04:23:22,990
their target of producing 100,000 units per year is well below their target of 180,000

2752
04:23:22,990 --> 04:23:23,690
units per year.

2753
04:23:24,510 --> 04:23:28,970
So this is a real troubling situation for us.

2754
04:23:29,070 --> 04:23:34,530
We know the need is there, the affordability is not there for many, many people, but how

2755
04:23:34,530 --> 04:23:41,230
we really address this issue with cooperation from the state that is almost falling in half

2756
04:23:41,230 --> 04:23:48,070
of what its target is, is really something that's really a concern to me.

2757
04:23:48,250 --> 04:23:54,210
I know it's all of us to have families have their homes here, the moderate and affordable

2758
04:23:54,210 --> 04:23:57,010
income housing families.

2759
04:23:57,490 --> 04:24:03,570
So it's just something that I think the general public needs to know that we're facing because

2760
04:24:03,570 --> 04:24:07,190
we're a high priced county as far as housing goes.

2761
04:24:07,970 --> 04:24:12,670
I mean, you hear we might be the highest price in the nation, or the state, or wherever

2762
04:24:12,670 --> 04:24:19,190
the measurement is, but I just, in the state, I just saw that one third of the people

2763
04:24:19,190 --> 04:24:26,910
spend more than half of their income on the household, on housing, or one half spend

2764
04:24:26,910 --> 04:24:32,450
at least a third, one way or the other, it's high, and we're really not on the right side

2765
04:24:32,450 --> 04:24:35,270
of that one, but it's going to be hard for us to catch up.

2766
04:24:35,270 --> 04:24:42,950
I think general public should know too that it's going to be a difficult mountain to climb to provide

2767
04:24:42,950 --> 04:24:48,710
this housing element for the people of Santa Cruz County who really need it in the middle income range.

2768
04:24:51,060 --> 04:24:53,600
Thank you. Supervisor Cap, you had some questions?

2769
04:24:53,620 --> 04:24:57,460
Yeah, I guess on that, the reserves just following up on that.

2770
04:24:57,680 --> 04:25:05,480
That affects credit rating and how we do business with other lending or bonds or things like that, right?

2771
04:25:05,480 --> 04:25:05,880
Correct.

2772
04:25:06,220 --> 04:25:07,960
How are we rated right now?

2773
04:25:08,300 --> 04:25:10,780
What's our rating with, would that be Moody?

2774
04:25:11,460 --> 04:25:16,320
We have ratings, but again, long-term and short-term ratings with Standard Imports and

2775
04:25:16,320 --> 04:25:20,480
Moody's, and let me get back to that information and I can provide it to you.

2776
04:25:25,070 --> 04:25:30,070
So our long-term rating with Standard Imports is double A negative, and Moody's it's A1.

2777
04:25:30,370 --> 04:25:34,610
Again, we were upgraded recently, we had a review in October of 2016.

2778
04:25:35,130 --> 04:25:35,250
Right.

2779
04:25:35,250 --> 04:25:39,450
A couple of years back it was a B something, right?

2780
04:25:39,990 --> 04:25:41,950
I wasn't involved at that time.

2781
04:25:42,150 --> 04:25:43,490
I don't think it was that low.

2782
04:25:44,490 --> 04:25:44,590
Yeah.

2783
04:25:44,930 --> 04:25:45,850
No, it wouldn't have been that low.

2784
04:25:46,610 --> 04:25:52,670
I guess the thing that I'm worried about is the crisis of the vanishing middle class.

2785
04:25:53,550 --> 04:25:55,230
I mean, we've got to watch out really close.

2786
04:25:56,430 --> 04:26:03,510
If you own a home, that'll make somebody upper class and everybody else will be renting.

2787
04:26:03,510 --> 04:26:07,430
and they'd be in a lower economic class.

2788
04:26:08,790 --> 04:26:10,690
There's got to be something in the middle there

2789
04:26:10,690 --> 04:26:12,830
with the rising costs of homes now,

2790
04:26:13,150 --> 04:26:17,010
almost to where they were before the crash.

2791
04:26:20,890 --> 04:26:24,190
I mean, that's something we've got to look at.

2792
04:26:24,330 --> 04:26:25,770
I don't know how we're going to fix that.

2793
04:26:26,810 --> 04:26:28,570
Well, just circling back down to these ratings,

2794
04:26:28,730 --> 04:26:31,350
I do want to emphasize the better rating we have,

2795
04:26:31,550 --> 04:26:32,650
the better price we're going to get

2796
04:26:32,650 --> 04:26:36,330
that when we go out to borrow money, and that in turn saves money for the county.

2797
04:26:36,750 --> 04:26:37,570
That's correct.

2798
04:26:39,170 --> 04:26:39,570
Thanks.

2799
04:26:41,890 --> 04:26:45,030
Well, I just want to say thanks for this information.

2800
04:26:46,010 --> 04:26:48,990
I just want to get back to the structural deficit question.

2801
04:26:50,710 --> 04:27:00,090
You look at it as these figures around $8.1 million, but because of the carryover of the fund balance,

2802
04:27:00,090 --> 04:27:03,570
that you think that that that will be a problem for this year.

2803
04:27:05,910 --> 04:27:06,950
Not in the current year.

2804
04:27:07,050 --> 04:27:10,210
The current year, we're making up the structural deficit with increased

2805
04:27:10,210 --> 04:27:12,010
revenues and carryover.

2806
04:27:13,030 --> 04:27:17,570
Next year, increased cost increase again and we're always paying catch-up, right?

2807
04:27:17,750 --> 04:27:19,710
So that's why we have that ongoing structural deficit.

2808
04:27:20,210 --> 04:27:25,350
Yeah, no, I mean, and the board has worked, I mean, this past year to try to add money

2809
04:27:25,350 --> 04:27:26,150
to the bottom line.

2810
04:27:26,150 --> 04:27:32,810
Yes, and it's actually we hope that it won't increase and we're trying very hard to make that happen.

2811
04:27:34,670 --> 04:27:41,810
I really like the new budget format and I spend a lot of time with that document so I think it'll be a lot easier to read,

2812
04:27:42,590 --> 04:27:46,110
at least in some of the format changes that you're talking about.

2813
04:27:47,210 --> 04:27:50,670
I wanted to get a little bit more information about the CIP question.

2814
04:27:50,670 --> 04:28:00,890
I understand CIP projects being in the budget, but we're used to the red book, which was a hard to read document.

2815
04:28:01,490 --> 04:28:05,230
And I thought we were trying to get to a CIP that was going to look at projects.

2816
04:28:05,470 --> 04:28:09,770
Maybe they weren't going to get funded this year because we could know that it was going to be funded in 2019.

2817
04:28:10,930 --> 04:28:16,110
Is that going to be part of it or is it only the ones that are going to be funded in the current year part of the CIP?

2818
04:28:17,650 --> 04:28:21,950
Right, so what we will do is, in the budget, we will include all projects that are going

2819
04:28:21,950 --> 04:28:26,050
to be funded, and then we will have a separate CIP document that will have all the other

2820
04:28:26,050 --> 04:28:30,330
projects, and they will also be reformatted to hopefully be more user-friendly.

2821
04:28:30,770 --> 04:28:31,710
Yeah, I think it will be great.

2822
04:28:31,950 --> 04:28:38,730
I mean, the sanitation district done a really good job, and I think that's a very important

2823
04:28:39,170 --> 04:28:43,830
document for someone who doesn't know a lot can read it and understand it, so I think

2824
04:28:43,830 --> 04:28:44,670
this is a good move.

2825
04:28:47,110 --> 04:28:50,530
The strategic plan process looks also very interesting.

2826
04:28:51,590 --> 04:28:55,510
And you mentioned in your remarks

2827
04:28:56,270 --> 04:28:58,710
that it would probably take us three years

2828
04:28:58,710 --> 04:29:00,830
before we could start looking at performance measures.

2829
04:29:02,170 --> 04:29:05,690
And then in the question from Supervisor Coonerty,

2830
04:29:06,250 --> 04:29:10,250
you talked about a five-year process or a five-year strategic

2831
04:29:10,250 --> 04:29:18,250
plan and I'm trying to get a sense of what we're, I imagine what you're suggesting is that we would start in the summer or fall of

2832
04:29:19,030 --> 04:29:27,410
2017 to start working on the strategic plan and are we going to be looking at, do you think that we're going to be looking at a three year or five year

2833
04:29:27,890 --> 04:29:31,230
plan as part of that, our initial strategic plan?

2834
04:29:31,810 --> 04:29:39,710
Yes, we were thinking of a five to six year plan with the overarching goals and then two year operational plans.

2835
04:29:40,330 --> 04:29:53,290
Do you expect before the budget hearings to come to us with a more fleshed out about what that process might look at, or is that something that would be that we wouldn't get it till August?

2836
04:29:54,090 --> 04:29:58,750
No, oh no, we intend to have that drain budget hearings, so you would have more detail

2837
04:29:58,750 --> 04:29:59,970
about what a proposed part-

2838
04:30:00,000 --> 04:30:23,500
The process would look like in that way you can give us feedback. And that way, once if we can come to an agreement on a process, we can start this summer, potentially. Right. Well, I hope that we get detailed information about it, not just a line item and graphics, but it would be really helpful to get detailed information. Okay, why don't we start with the department? All right. Public works will be the first department.

2839
04:30:47,860 --> 04:30:51,480
Good afternoon, Mr. Presley. Good afternoon, Chairman.

2840
04:30:51,480 --> 04:30:52,940
and they pulled in board members.

2841
04:30:54,020 --> 04:30:56,240
I'm going to go to the first slide here, I think.

2842
04:30:56,640 --> 04:30:57,320
I can find it.

2843
04:31:05,780 --> 04:31:06,020
Very good.

2844
04:31:11,370 --> 04:31:12,450
Much better with robots here.

2845
04:31:12,450 --> 04:31:12,990
It's not working.

2846
04:31:13,570 --> 04:31:13,930
There it goes.

2847
04:31:14,150 --> 04:31:16,590
Okay, I'm John Presley from the Department of Public Works.

2848
04:31:16,730 --> 04:31:19,830
I do have staff here today, so I welcome them as well.

2849
04:31:20,710 --> 04:31:23,070
I'm going to start off a little bit about the storm damage.

2850
04:31:24,470 --> 04:31:27,650
And as you know, this has been an extraordinary year for us.

2851
04:31:29,330 --> 04:31:30,370
Like no other.

2852
04:31:30,950 --> 04:31:33,870
The good news is we still have a few intact roads out there.

2853
04:31:35,070 --> 04:31:41,010
The not-so-good news is these numbers that are shown here, the 30 million, is probably closer to 40 million.

2854
04:31:41,710 --> 04:31:51,090
And the one million on the Forest Account, and that's where we're opening up roads, removing slide materials, and you know, where people get home, that's probably over 2 million at this point.

2855
04:31:52,090 --> 04:31:58,730
We have met with Cal OES and FEMA at this point and we're documenting all the

2856
04:31:58,730 --> 04:32:03,810
storm damage through disaster survey reports. We're also met with Cal Trans

2857
04:32:03,810 --> 04:32:08,430
Briefly and we hope to meet with FHWA as early as next week, working with

2858
04:32:09,230 --> 04:32:16,050
Congressman Panetta, Congresswoman's, and an issues office. So they've been very

2859
04:32:16,050 --> 04:32:22,550
helpful to kind of catch the attention of FHWA, which is the Federal Highway Administration.

2860
04:32:24,700 --> 04:32:32,610
What we're also looking at is internally is ability to do a recovery unit within public

2861
04:32:32,610 --> 04:32:39,990
works and that's going to include where we maybe bring on or work with our analysts and

2862
04:32:39,990 --> 04:32:45,710
and accountants to coordinate most of the storm activities in working with our engineering

2863
04:32:45,710 --> 04:32:51,470
staff. Our engineering staff need the time to actually do the engineering work. So we

2864
04:32:51,470 --> 04:32:59,990
can do all the other stuff of the planning preparation for financing, timing of construction,

2865
04:33:00,270 --> 04:33:06,290
all those through our analysts and our accountants. Also develop the internal funds that we need

2866
04:33:06,290 --> 04:33:11,670
to support the local match for all the damage out there.

2867
04:33:13,230 --> 04:33:17,690
One of the other things that we're also exploring, and we did mention this at the Lake

2868
04:33:17,690 --> 04:33:17,930
View.

2869
04:33:18,130 --> 04:33:22,530
I brought this up at the Lake View meeting with Supervisor McPherson last night, was the

2870
04:33:22,530 --> 04:33:25,810
idea of maybe looking at a CSA.

2871
04:33:26,830 --> 04:33:30,070
And that was brought to us by Supervisor Cooner, D's office.

2872
04:33:30,890 --> 04:33:35,750
There is a chance that we could look at that through a benefit assessment over the existing

2873
04:33:35,750 --> 04:33:37,370
91, 2 and 3.

2874
04:33:38,950 --> 04:33:46,030
We could look at a 3-5-year recovery emergency effort, it would be a, if we declared an emergency,

2875
04:33:46,190 --> 04:33:50,450
we could do a 50% plus 1 vote and it might be as simple as a mail-out ballot.

2876
04:33:51,170 --> 04:33:54,710
So we want to study that a little more, work with County Council.

2877
04:33:54,710 --> 04:34:00,470
So if that's a, if that's a go, we'd like to do a poll and possibly move forward with that.

2878
04:34:01,310 --> 04:34:07,490
So, and the idea is we would, there is 391 North Midd County and South County.

2879
04:34:07,710 --> 04:34:13,830
We would poll each, each of those districts or each of those three areas and see if there's a support for that.

2880
04:34:13,990 --> 04:34:17,710
It seemed to be the residents in Santa Cruz County were very supportive last night.

2881
04:34:17,710 --> 04:34:22,070
I think we're ready to sign up right now for improving our roads as a local match.

2882
04:34:22,070 --> 04:34:29,170
So I'm not so sure about the South County or Mid-County, but we can certainly do a poll and look at that if your board was interested

2883
04:34:30,170 --> 04:34:34,890
And try and get on the tax roll right now is the time to do this because of the

2884
04:34:36,450 --> 04:34:43,910
The amount of damage and the concern of the public out there. So moving on, you said let's look

2885
04:34:45,510 --> 04:34:47,170
There he goes. Okay

2886
04:34:48,390 --> 04:34:49,210
Street maintenance

2887
04:34:51,090 --> 04:34:58,050
We typically, we run about 12 million a year on street maintenance, and that's for basic roadway maintenance.

2888
04:34:58,610 --> 04:35:04,990
It's also for take care of our fleet, our roads, our drainage, litter, graffiti of maintenance, so it's in mowing.

2889
04:35:06,530 --> 04:35:14,750
We have probably a, I don't want to use structural deficit, but we have a deficit of about $150 million, and it's probably climb since then,

2890
04:35:14,750 --> 04:35:18,630
only because of the magnitude of the storms that we've seen.

2891
04:35:19,990 --> 04:35:25,850
Funding sources that we have and we plan on having in the future for street maintenance

2892
04:35:25,850 --> 04:35:31,130
is obviously the measure D which we would like to use for repairing our roads or resurfacing

2893
04:35:31,130 --> 04:35:31,670
our roads.

2894
04:35:32,010 --> 04:35:36,790
We have a new traffic impact fee which $600,000 this year and it goes to 1.4 next year.

2895
04:35:37,390 --> 04:35:43,650
We have existing CS890 which generates 2.7 and this is where we place a benefit assessment

2896
04:35:43,650 --> 04:35:46,790
on top of this for emergency repairs.

2897
04:35:47,730 --> 04:35:51,250
We also have existing gas tax of five to six million dollars.

2898
04:35:52,370 --> 04:35:57,690
We supplement that often with grant money that comes in so we try to do a lot of grants,

2899
04:35:58,010 --> 04:36:02,930
you know, we pursue a lot of grants for resurfacing or safety improvements.

2900
04:36:03,130 --> 04:36:05,430
So that's, I didn't put that on the slide, but that's out there.

2901
04:36:06,050 --> 04:36:10,690
Now the future funding, SB1, AB1, obviously we've been working at that for several years.

2902
04:36:10,690 --> 04:36:17,350
I heard that they got through a second committee, the Senate Environmental Committee, which

2903
04:36:17,350 --> 04:36:23,730
is good, and from Supervisor Stone's office they're talking about a vote as soon as April

2904
04:36:23,730 --> 04:36:24,610
6th.

2905
04:36:24,730 --> 04:36:29,010
So I am sending out a global letter to all the public works directors to get down there

2906
04:36:29,010 --> 04:36:33,630
and meet with your legislators and pursue educating them on the need for AB1 SB1.

2907
04:36:34,250 --> 04:36:39,870
So that's an ongoing process, we hope to see that pass this spring.

2908
04:36:41,090 --> 04:36:42,610
Okay, equipment facilities,

2909
04:36:46,120 --> 04:36:50,920
one of the, one thing about you say county roads, we have probably

2910
04:36:50,920 --> 04:36:53,820
the oldest equipment in the state of California, it is old.

2911
04:36:55,060 --> 04:36:58,840
We have a couple dump trucks that are, well, we have a number of dump trucks that are not

2912
04:36:58,840 --> 04:37:04,800
going to meet car regulations anymore after probably early this spring, there are diesel vehicles

2913
04:37:04,800 --> 04:37:11,060
that need to be replaced, we're looking at purchasing two vehicles and if we keep our dump trucks

2914
04:37:11,060 --> 04:37:15,720
below a thousand, thousand hours, we can use the rest of them throughout the rest of the

2915
04:37:15,720 --> 04:37:17,820
year, but at some point we need to replace our dump trucks.

2916
04:37:18,280 --> 04:37:25,080
We also have patch trucks that are, you know, the 1989 variation or age.

2917
04:37:26,000 --> 04:37:30,660
Generally, I have a 10-year lifespan, we've exceeded that, and we have pickup trucks that

2918
04:37:30,660 --> 04:37:31,140
need to replace.

2919
04:37:31,340 --> 04:37:32,160
We have backhows.

2920
04:37:32,380 --> 04:37:38,320
So, part of that whole transportation funding that I just talked about would go towards purchasing

2921
04:37:38,320 --> 04:37:39,400
some of the new equipment.

2922
04:37:40,480 --> 04:37:41,520
Bromor facility.

2923
04:37:42,060 --> 04:37:44,400
You can look at any of our road facilities.

2924
04:37:44,820 --> 04:37:46,360
They need some basic work.

2925
04:37:46,680 --> 04:37:50,100
So we started the process of looking at that, improving,

2926
04:37:50,840 --> 04:37:54,020
you know, the roofing the windows and the eating out there.

2927
04:37:54,300 --> 04:37:57,020
So we're hoping to see, you know, ideally,

2928
04:37:57,400 --> 04:37:59,740
we'll see a new gas tax this spring,

2929
04:37:59,820 --> 04:38:01,360
and we can do some upgrades,

2930
04:38:01,360 --> 04:38:03,940
and then we can really get back to fixing our roads.

2931
04:38:10,330 --> 04:38:19,990
This is another thing that we're working at, the state level, is trying to develop some new ideas on drainage and how we can support it at a statewide level.

2932
04:38:20,570 --> 04:38:25,470
Primarily through the County Engineers Association and through the California State Association of counties.

2933
04:38:26,230 --> 04:38:35,330
We definitely need to look at future funding needs, both environmental and infrastructure improvement water quality.

2934
04:38:35,330 --> 04:38:40,670
for a number of our zones, in particular zone 4, 5, 6, and possibly 7,

2935
04:38:41,950 --> 04:38:44,610
probably need to, you know, need to be increased.

2936
04:38:44,950 --> 04:38:49,270
There is a prop 2, 18 condition on that, so it's going to have to go out for a public vote,

2937
04:38:49,290 --> 04:38:53,950
but it certainly is something that we have some aging culverts out there.

2938
04:38:54,030 --> 04:38:57,390
We need to do better maintenance on our channels and things like that.

2939
04:38:58,110 --> 04:39:00,410
Pump stations as well, upgrades on that.

2940
04:39:01,370 --> 04:39:04,330
The power river, oh, let me talk about.

2941
04:39:04,330 --> 04:39:08,610
We're also seeing some new regulations coming down from the State Water Board and the Regional

2942
04:39:08,610 --> 04:39:08,850
Board.

2943
04:39:09,370 --> 04:39:12,170
And, you know, they're really sticking to a lot of agencies.

2944
04:39:12,410 --> 04:39:17,150
I hate to use it sticking, but there's new requirements of water quality issues that

2945
04:39:17,150 --> 04:39:23,890
we're constantly at the pay attention to, and they're increasing their fees for the permits

2946
04:39:23,890 --> 04:39:24,830
on a yearly basis.

2947
04:39:25,510 --> 04:39:29,690
The power river, obviously, there's some complexity of that working with the Corps of Engineers.

2948
04:39:31,850 --> 04:39:36,850
We're going to bring that back on March 21st for further discussion, but it's a constant

2949
04:39:36,850 --> 04:39:38,090
up and down battle with the Corps.

2950
04:39:38,270 --> 04:39:42,950
Every time we think we take a step back, we get pretty much kicked in the teeth and

2951
04:39:42,950 --> 04:39:50,150
knock back two steps so ongoing issues with them, but we'll give you more complete details

2952
04:39:50,150 --> 04:39:53,610
on March 21st on the zone 7 meeting.

2953
04:39:53,610 --> 04:39:54,590
And

2954
04:39:57,570 --> 04:40:03,360
then solid waste, we are, we're doing fairly well.

2955
04:40:04,270 --> 04:40:09,280
We do have some new regulations from Cal recycle about the organic so that's been implemented

2956
04:40:09,280 --> 04:40:14,780
through for large producers, especially grocery stores and stuff.

2957
04:40:15,280 --> 04:40:20,260
We do not want to bury organic in our solid waste facilities anymore, they generate methane

2958
04:40:20,260 --> 04:40:21,920
gas, so things like that.

2959
04:40:22,280 --> 04:40:23,880
So we're working on our organic program.

2960
04:40:23,880 --> 04:40:31,000
We are also looking at some land purchases for building a new facility for organic waste

2961
04:40:31,000 --> 04:40:32,660
and green waste recycling.

2962
04:40:34,660 --> 04:40:36,480
We're near on our franchise agreement.

2963
04:40:36,660 --> 04:40:38,220
We want to bring that back to your board shortly.

2964
04:40:38,980 --> 04:40:41,500
That's the franchise horror.

2965
04:40:42,200 --> 04:40:51,620
And then we're working on also the green waste franchise or green waste recycling contract

2966
04:40:51,620 --> 04:40:54,380
as well, which we're going to bring back to you in the near future.

2967
04:40:55,120 --> 04:41:01,200
I think you'd be impressed with the negotiations that went on for those contracts.

2968
04:41:02,320 --> 04:41:09,320
Just to let you know, we've put about 12,000 tons of storm damage material out at Boinevista.

2969
04:41:09,580 --> 04:41:14,560
We hope to recycle that out at some point or so at a cost of about 190,000 dollars.

2970
04:41:15,380 --> 04:41:19,100
One thing that we could use in this county is a place to put land.

2971
04:41:20,460 --> 04:41:29,100
Well, just material, yeah, I'd say material third soil, when we have these massive landslides

2972
04:41:29,100 --> 04:41:35,320
on our county roads, so we're working with Scotts Valley right now to dispose of it, some

2973
04:41:35,320 --> 04:41:39,680
of it on an interim basis, but ideally we need to purchase a future facility.

2974
04:41:40,380 --> 04:41:42,580
So that completes it.

2975
04:41:42,820 --> 04:41:47,980
I think we have a lot of stuff that's happening right now that's progressing.

2976
04:41:47,980 --> 04:41:49,660
I didn't mean to get to the sheriff's here.

2977
04:41:50,280 --> 04:41:50,800
Okay.

2978
04:41:51,120 --> 04:41:54,580
Let me see whether board members have questions about public works.

2979
04:41:57,520 --> 04:41:58,440
Supervisor McPherson.

2980
04:41:58,980 --> 04:41:59,100
Yeah.

2981
04:41:59,700 --> 04:42:03,600
You've heard the congratulations for everything your department's doing.

2982
04:42:05,340 --> 04:42:07,480
Cookies and all, but today.

2983
04:42:07,880 --> 04:42:13,100
But one thing about with the storm situation, and this is not specifically at this budget,

2984
04:42:13,100 --> 04:42:17,900
but when we have this down, so many trees, and especially up in the Valle,

2985
04:42:19,940 --> 04:42:30,320
I don't know if we can, it's a matter of money, but for people to be able to deliver some of their rubbish to the, you know, on the weekends in particular.

2986
04:42:30,560 --> 04:42:36,920
That's what they've been always asking. We'll get into that. I'm sure more in the budget sessions, but that's something that is a layering question.

2987
04:42:37,100 --> 04:42:43,120
It just goes on and on. I'd like to see if, you know, we look into that as we go into next year's budget too.

2988
04:42:43,120 --> 04:42:50,440
if we can get that kind of service on a weekend or in response to a storm like some of the storms like we've had.

2989
04:42:50,920 --> 04:43:12,860
I mean, reopening on a Sunday or would it be, you know, so we've sort of looked at that, would it be a replacement of, could we close on Monday, for example, you know, just kind of offset that because it is, it's a very expensive process to open up on Sunday and we don't really see any new revenue increases, something like $800,000 more to open up on a Sunday through the whole year or so.

2990
04:43:13,560 --> 04:43:16,960
Yeah, I don't know, I just looked into that certainly.

2991
04:43:17,020 --> 04:43:21,480
Yeah, if you didn't, weren't open Monday and you were open Sunday or one day of the weekend.

2992
04:43:21,680 --> 04:43:22,580
We could certainly look at that.

2993
04:43:22,960 --> 04:43:31,160
And then with the, I think it would be interesting to me, everybody worked very hard on this measure D to pass and thank heavens it did.

2994
04:43:31,820 --> 04:43:42,300
But to put in a fee, a temporary fee of maybe five years or something on the 90, three zones or areas, that would be, I'd be interested to see how,

2995
04:43:42,300 --> 04:43:47,120
Well, what the response is to that, what we had at Lakeside School last night was very positive.

2996
04:43:47,460 --> 04:43:53,060
But if we're going to push the button on something like that, this would be a good time to do it.

2997
04:43:53,220 --> 04:43:54,180
It's fresh in people's minds.

2998
04:43:54,620 --> 04:43:57,180
And it's the only way we're going to get more revenue for it, I think.

2999
04:43:57,380 --> 04:43:59,060
Yeah, I think you're right.

3000
04:43:59,720 --> 04:44:03,460
When we actually tabulate everything up, we'll see what our local match is.

3001
04:44:03,720 --> 04:44:10,380
We can gear that out, or sell that out, or provide it to the public and say, this is the type of resources we need.

3002
04:44:10,380 --> 04:44:14,720
this is why we want a certain amount on that CSA or benefit assessment for that particular

3003
04:44:14,720 --> 04:44:15,080
district.

3004
04:44:15,580 --> 04:44:21,640
So that's part of that recovery unit that I'm looking at is how we kind of couch everything

3005
04:44:21,640 --> 04:44:25,780
and sell it out there to the public and say, this is what we need to actually rebuild

3006
04:44:25,780 --> 04:44:26,200
the roads.

3007
04:44:26,680 --> 04:44:30,240
And we look at some of the revenue coming from measure D and all we look at, we just think

3008
04:44:30,240 --> 04:44:35,540
of roads and the surface roads, but the stormwater, the drainage facilities which got clogged

3009
04:44:35,540 --> 04:44:42,240
evident as gave in a lot of instances, could that specifically be part of, or is it now part

3010
04:44:42,240 --> 04:44:47,140
of the recovery process, or the ongoing maintenance process, I guess?

3011
04:44:47,280 --> 04:44:49,720
I'd like to have that be part of it.

3012
04:44:50,120 --> 04:44:56,060
We could, I mean, it's not as, you don't see it as much, but boy, it's invaluable as we're

3013
04:44:56,060 --> 04:44:59,380
learning today, that if we would have a better storm water.

3014
04:45:00,940 --> 04:45:27,760
System to handle that onslaught of water, which we don't expect every year, but it'd be helpful. I think it should be part of our re-building process. It's not really a good thing when you run a redwood tree through a culvert that's underneath the road sometimes, and they tend to block up and we lose the road, so. But there are undersized culverts that we need to upgrade on a lot of our rural roads, and we could factor that in as well. So.

3015
04:45:30,820 --> 04:45:48,180
I think you're heading in the right direction, I guess my only message would be how much faster we can move, you know, a month of sunny, sunny weather and the willingness to pay a tax goes down or additional fee for a short period of time goes down significantly.

3016
04:45:48,620 --> 04:45:55,940
So I think we want to move as quickly as possible, and also the same with measure D where we have a great bond rating,

3017
04:45:56,600 --> 04:46:00,420
money's cheap, we know that interest rates are going to rise three times the next year.

3018
04:46:01,140 --> 04:46:08,460
The longer we wait to borrow, and I know we're hamstring a little bit by the RTC, but whatever we can do to finance the interim,

3019
04:46:09,120 --> 04:46:18,160
It seems like this is the time we want to figure out how to bond out while we'll get more bang for our buck.

3020
04:46:18,520 --> 04:46:22,140
So trying to move this quick, understanding you're getting pulled in a lot of directions.

3021
04:46:22,360 --> 04:46:28,120
But we've got to move, I think for both of those things sooner rather than later or we lose money.

3022
04:46:28,560 --> 04:46:32,960
Okay, we're going to try and expedite that. We do have to do an engineer's report and we really want to do a poll.

3023
04:46:33,520 --> 04:46:36,140
So we'll get on that right now.

3024
04:46:36,140 --> 04:46:36,420
So,

3025
04:46:39,100 --> 04:46:41,380
could you just thank you for the presentation.

3026
04:46:42,420 --> 04:46:46,240
CSA 90, could you just remind us with a geographical destination?

3027
04:46:46,680 --> 04:46:48,600
Is that the entire county or is that?

3028
04:46:48,940 --> 04:46:50,460
It's broken up in three sections.

3029
04:46:52,000 --> 04:46:53,320
There's, it's hard to say.

3030
04:46:53,540 --> 04:46:57,880
It's, you know, your live oak is probably a border line for North County up.

3031
04:46:58,260 --> 04:47:02,180
And you're from North County where your border, where your district starts,

3032
04:47:02,180 --> 04:47:08,300
It goes down to maybe the Apples area there, so that's Mid County.

3033
04:47:09,020 --> 04:47:19,380
Generally the North County and Mid County generate the most resources and it's about 2.3 million between the two of those and there's $400,000 generated by the South County.

3034
04:47:20,820 --> 04:47:28,380
Because I think it may be a wise strategy but we will be faced with some difficult questions if not everybody passes it.

3035
04:47:29,240 --> 04:47:36,040
So, for instance, in the example you used if the North County folks were willing to tax

3036
04:47:36,040 --> 04:47:42,280
themselves, but the mid-county folks just failed to get to the required threshold, but

3037
04:47:42,280 --> 04:47:42,720
we're close.

3038
04:47:43,480 --> 04:47:48,260
It doesn't mean that Valencia Road or SoCal San, I mean we still have to fix those roads.

3039
04:47:48,680 --> 04:47:54,940
So it creates, when we do this by zone, it creates kind of a problem as to which pot of

3040
04:47:54,940 --> 04:48:01,400
money we're going to get to, because on some of these critical roads, they're used by everybody in the county, right?

3041
04:48:01,680 --> 04:48:08,180
I mean, it isn't just that the people of the summit area or the Aptosales or the Sailor-Renz over Alley-Due

3042
04:48:08,180 --> 04:48:16,540
where don't want to do this, but these are, some of these roads are used by everybody, and that's going to become our challenge to figure out how to do it,

3043
04:48:16,620 --> 04:48:19,000
whether if I don't, you know, I'll look forward to the polling.

3044
04:48:19,000 --> 04:48:29,100
And I think the polling will identify hopefully what people are willing to pay for that into that benefit assessment could be $25, $50, $100.

3045
04:48:29,800 --> 04:48:44,840
So that's kind of like the tipping point there, maybe South County, $35, Mid County, $40 and San Lorenzo Valley is maybe $100 per year for next three to five years.

3046
04:48:44,840 --> 04:48:51,700
Because sunny days, I agree with my colleague that sunny days may convince people you know that things are not great

3047
04:48:51,700 --> 04:48:56,480
But if you have to go you know five miles out of your way just to get home

3048
04:48:56,480 --> 04:48:59,760
Whether it's on a sunny day or a rainy day, you know

3049
04:48:59,760 --> 04:49:03,000
It's you get reminded of that pretty pretty regularly

3050
04:49:03,000 --> 04:49:08,000
And I know for constituents of mine in the rural areas when roads have been knocked out for a long period of time

3051
04:49:08,000 --> 04:49:12,340
They never fail to mention it to me every time I see it. Yeah, we've got that problem, too

3052
04:49:12,340 --> 04:49:16,640
Yeah, I mentioned a lot, so the other, and then the other sort of

3053
04:49:18,920 --> 04:49:24,000
The the challenge as we will hear is, you know, county fire is gonna come up here

3054
04:49:24,000 --> 04:49:28,660
And they might need to go out to the ballot and you know the parks have talked about going out to the ballot

3055
04:49:28,660 --> 04:49:34,940
So it's gonna be we're gonna see where polling is and what's most likely and where we need the resources

3056
04:49:35,500 --> 04:49:38,460
But I think we have to it's a strategy. We have to at least pursue

3057
04:49:39,280 --> 04:49:42,160
Until we know have a better idea. Yes, but thanks for the work

3058
04:49:43,220 --> 04:49:44,320
Supervisor Capit.

3059
04:49:44,760 --> 04:49:45,020
You bet.

3060
04:49:45,320 --> 04:49:51,440
Well, it's been in the news lately, the gas tax, the gas prices per gallon going up maybe

3061
04:49:51,440 --> 04:49:58,280
in the spring as much as up to $4 a gallon, but you know, that's of course a projection

3062
04:49:58,280 --> 04:50:00,040
just to the newspaper right now.

3063
04:50:00,740 --> 04:50:08,500
But how much would that raise in price per gallon actually affect the money coming into

3064
04:50:08,500 --> 04:50:09,480
your work crew?

3065
04:50:10,840 --> 04:50:12,740
How much would it raise?

3066
04:50:13,000 --> 04:50:16,800
How much more money would revenue would that bring in?

3067
04:50:17,120 --> 04:50:21,960
We would see around $8 million command for county public works for road maintenance purposes.

3068
04:50:22,580 --> 04:50:23,740
As it is right now.

3069
04:50:24,180 --> 04:50:30,880
No, as new money would come in, if they, if they may be one, yeah, SB one, if it was passed it would be around $8 million.

3070
04:50:31,320 --> 04:50:38,420
Now it's just not all gas tax, it's also, you're looking at electric vehicle motorists, drivers,

3071
04:50:38,420 --> 04:50:38,600
drivers.

3072
04:50:40,860 --> 04:50:47,800
They would see an extra charge on their DMV license. They are not paying anything

3073
04:50:47,800 --> 04:50:51,460
for road maintenance right now. Anybody drives electric cars, not paying any maintenance.

3074
04:50:51,740 --> 04:50:53,400
Yes, but they are saved.

3075
04:50:53,640 --> 04:50:55,540
There is a fairness to this, my fellow.

3076
04:50:55,920 --> 04:51:00,160
Yes, but they are saving the, they are helping the environment.

3077
04:51:01,060 --> 04:51:01,560
Most certainly.

3078
04:51:01,760 --> 04:51:01,980
Definitely.

3079
04:51:02,900 --> 04:51:08,260
Yes, and I guess the other is, what do I tell people in the Lycan community? I know if

3080
04:51:08,260 --> 04:51:16,060
If we don't get the 100-year plan or whatever going, I mean, what more can we do there with college lake and

3081
04:51:16,580 --> 04:51:18,580
quarterly this creek and

3082
04:51:19,120 --> 04:51:25,680
self-supporting creek and Pinto stream all running together on that one culvert. We need a bigger levy system

3083
04:51:25,680 --> 04:51:32,420
when we need out there and that's that's something that will continue to support through the Corps of Engineers.

3084
04:51:32,420 --> 04:51:38,260
players, whether or not they're going to ultimately construct it or not, that's still out there.

3085
04:51:40,720 --> 04:51:46,060
That's something we hope to resolve one way or another in the next year, whether or

3086
04:51:46,060 --> 04:51:48,140
not we need to do something other than the core.

3087
04:51:49,440 --> 04:51:52,020
Can we actually go in that to covert?

3088
04:51:52,220 --> 04:51:55,380
This is a pretty big one, six foot and actually just clean it up.

3089
04:51:55,840 --> 04:52:01,360
I know a fishing game will get involved in that big time, but it's actually not bad.

3090
04:52:01,360 --> 04:52:04,380
Yeah, it's actually been cleaned out with the recent flows.

3091
04:52:04,800 --> 04:52:08,880
There is debris that comes in and I know that our staff went out there and pulled debris

3092
04:52:08,880 --> 04:52:09,360
out of there.

3093
04:52:09,660 --> 04:52:14,860
But, you know, that channel is fairly clean right now because of all the mass amount

3094
04:52:14,860 --> 04:52:15,920
of water that came through there.

3095
04:52:16,680 --> 04:52:21,940
So it's, we'll continue to monitor it, as we always do.

3096
04:52:23,140 --> 04:52:28,520
But it's, the whole system's been flushed pretty well through these storms.

3097
04:52:28,520 --> 04:52:34,480
Yeah, I guess would cause the backup is just too much water coming from three different sources.

3098
04:52:34,860 --> 04:52:39,680
That is correct. That's what there was tremendous amount of water and it all came in at the same time.

3099
04:52:39,760 --> 04:52:47,760
And I guess the fastest moving stream actually gets through there quickly and that backs up the slower moving ones, right?

3100
04:52:48,040 --> 04:52:48,140
Correct.

3101
04:52:48,920 --> 04:52:49,380
Okay,

3102
04:52:51,500 --> 04:52:52,700
thank you very much. Thank you.

3103
04:52:55,030 --> 04:52:56,390
Next, we move on to the sheriff.

3104
04:52:56,970 --> 04:52:59,130
Sheriff and county fire will both come up right now.

3105
04:53:13,340 --> 04:53:20,400
Good afternoon. Chairman Leopold, super registrar. Jim Hart, sheriff corner. Today I'm going

3106
04:53:20,400 --> 04:53:24,260
to talk to you about not so much where we're at today, but some items that we're looking

3107
04:53:24,260 --> 04:53:29,480
at moving forward, particularly in the 17-18 budget. And supervisor Kennedy, you mentioned

3108
04:53:29,480 --> 04:53:33,420
that you're looking for some innovations, and there's a number of things that we're in

3109
04:53:33,420 --> 04:53:39,420
the process of doing right now and intent on doing in the future that are very innovative.

3110
04:53:39,420 --> 04:53:44,120
and I think we'll really move our department in public safety and a positive direction.

3111
04:53:54,170 --> 04:54:04,210
Wrong way. Area. So with the designation of the national monument, we're anticipating

3112
04:54:04,210 --> 04:54:07,350
somewhere in the neighborhood of several hundred thousand visitors on the North Coast

3113
04:54:07,890 --> 04:54:13,830
in addition to what we already have and then also with the opening of the San Vicente Redwoods

3114
04:54:13,830 --> 04:54:20,330
in the next year to two years, it's an 8500 acre parcel that will, our public land will

3115
04:54:20,330 --> 04:54:27,550
be opened up for public use. The need for public safety up on the north coast is, it's

3116
04:54:28,330 --> 04:54:32,850
badly needed. I think it's an extremely underserved community. And so we're doing some things

3117
04:54:32,850 --> 04:54:38,170
right now. The sheriff's office along with the county parks department is looking at partnering

3118
04:54:38,170 --> 04:54:49,890
with some private funders to provide park services and public safety in and around the San Vicente Redwoods property, and then also with the national monument status.

3119
04:54:51,110 --> 04:55:07,890
I'm not convinced that BLM is in a position to provide any kind of public safety on that property, but not so much on the interior of the property that I'm worried about, it's mostly along the roadways and the beaches and the increased traffic, traffic parking, overnight camping, beach use.

3120
04:55:07,890 --> 04:55:13,330
So, those are all areas that we will be dealing with as a sheriff's office on that north coast.

3121
04:55:13,830 --> 04:55:21,130
And so, moving forward into the 1718 budget, I'm looking at increasing staffing on the north coast

3122
04:55:21,130 --> 04:55:23,430
and getting more of a permanent presence up there.

3123
04:55:24,830 --> 04:55:27,790
How many acres is that, good to me?

3124
04:55:29,920 --> 04:55:31,060
57 hundred.

3125
04:55:31,540 --> 04:55:37,880
I thought there's a lot of other land, San Vicente's, double that, next door.

3126
04:55:37,880 --> 04:55:49,080
Under facilities, as you know, we are currently in the construction process for our rehabilitation and reentry facility on our Roundtree South County campus.

3127
04:55:50,260 --> 04:55:58,220
And that money came from the state under one of the governor's release for jail improvements and jail constructions.

3128
04:55:59,180 --> 04:56:04,100
And with that, we're building a facility for long-term inmates.

3129
04:56:04,100 --> 04:56:24,760
It's back in 2011 when prison re-alignment hit, our county jail system turned into a state prison where we're now housing an average of 70 state prison inmates on any given day in the county jail system for as long as 12 years and the existing facilities we have are not conducive to staying for that length of time.

3130
04:56:24,760 --> 04:56:34,580
And so the rehabilitation and reentry facility is built for long term stayers and it's going to be focusing on vocational training, programming.

3131
04:56:35,260 --> 04:56:39,920
We're partnering with Cabrio College to get these people some college units as well.

3132
04:56:40,780 --> 04:56:43,020
But with that, it's opening up some opportunities.

3133
04:56:43,420 --> 04:56:52,520
And because Blaine Street for women, which is a minimum security facility and the way that the justice system has changed over the last few years,

3134
04:56:52,520 --> 04:56:55,400
Because we're just not housing that level of inmate any longer.

3135
04:56:56,440 --> 04:57:01,020
And most of the minimum security females are out on electronic monitoring.

3136
04:57:01,240 --> 04:57:03,900
We're just don't house minimum security inmates anymore.

3137
04:57:04,860 --> 04:57:08,520
And so our daily average daily population at Blaine Street reached two.

3138
04:57:09,480 --> 04:57:15,100
And so we have temporarily closed that facility and moved those two women back over to the main

3139
04:57:15,100 --> 04:57:15,380
jail.

3140
04:57:16,360 --> 04:57:21,300
And sometime this month we're going to be moving about 35 women down to round tree, medium security.

3141
04:57:21,300 --> 04:57:24,200
and we've already cleared the space for them

3142
04:57:24,200 --> 04:57:25,400
and one of the housing is there.

3143
04:57:26,100 --> 04:57:30,720
And those 35 women will be living in that medium security jail,

3144
04:57:30,860 --> 04:57:34,240
which is much more appropriate for good programming

3145
04:57:34,240 --> 04:57:35,560
and visitation.

3146
04:57:35,940 --> 04:57:42,480
And I think it's going to meet the needs of our women's population as well.

3147
04:57:43,500 --> 04:57:47,540
We're also looking at various systems we have internally

3148
04:57:47,540 --> 04:57:57,860
And we're looking at using a gender specific assessment tool in particular to women because there's been some argument that we're overclassifying the women.

3149
04:57:58,440 --> 04:58:06,180
And so when we go to this tool, it may be that some of the women that classify as medium or maximum may be able to classify down and we'll be able to reopen Blaine Street.

3150
04:58:06,420 --> 04:58:09,460
But as of right now, Blaine Street is temporarily shuttered.

3151
04:58:09,460 --> 04:58:13,760
But with the opening of the new Roundtree Rehabilitation Reentry Facility,

3152
04:58:14,000 --> 04:58:17,260
we'll be housing about 154 people down on that Roundtree campus,

3153
04:58:17,340 --> 04:58:19,460
which is about a third of our entire jail population.

3154
04:58:20,120 --> 04:58:23,520
So there'll be a significant number of people staying down there.

3155
04:58:24,100 --> 04:58:26,540
The second thing that we're looking at is we have a large,

3156
04:58:26,620 --> 04:58:31,320
shelled out space at our headquarters facility that has always been intended

3157
04:58:31,320 --> 04:58:32,440
to be a shooting range.

3158
04:58:32,640 --> 04:58:34,800
We ran out of money when we built a facility.

3159
04:58:35,540 --> 04:58:38,680
And so we have a number of trusts that we're building up some dollars

3160
04:58:38,680 --> 04:58:44,600
on, but right now our staff, our sworn staff, has to qualify at the shooting range quarterly.

3161
04:58:44,900 --> 04:58:48,920
So every three months we either have to get them down to Mark Lee's down in Watsonville or Santa

3162
04:58:48,920 --> 04:58:52,220
Query County Sheriff's Office or San Benito Sheriff's Office and use their ranges.

3163
04:58:52,980 --> 04:58:56,540
And so we're looking at building a range at our headquarters campus.

3164
04:59:05,760 --> 04:59:14,000
Another emerging issue is we have a very sound forensic services unit and they focus primarily

3165
04:59:14,000 --> 04:59:21,580
on latent fingerprints, they work on skeletal remains, and then also forensic digital evidence.

3166
04:59:22,900 --> 04:59:27,880
And in the next three to five years, we have a plan to also move that laboratory to have DNA

3167
04:59:27,880 --> 04:59:36,020
capabilities. And the advantage to the community on this will be that when we have a remarkable case,

3168
04:59:36,020 --> 04:59:43,800
if it's a series of violent offense, we submit DNA to the Department of Justice. And those are

3169
04:59:43,800 --> 04:59:49,720
priority cases, the turnaround time on those cases are 6-8 weeks to get DNA evidence back.

3170
04:59:50,440 --> 04:59:55,880
And if we have our own lab, we'll be able to turn around evidence in 24-48 hours, which

3171
04:59:55,880 --> 04:59:59,920
I think will greatly enhance our investigative abilities and our abilities.

3172
05:00:07,720 --> 05:00:28,120
There's a sort of several steps to get to DNA accreditation. The first one is to get our current forensic lab accredited. And it's going to cost a few dollars, particularly the dollars are going to be dedicated for DNA software. And we have a trust right now, a DNA trust that will pay for a majority of those expenses.

3173
05:00:30,770 --> 05:00:33,350
Another emerging issue is under our recovery centers.

3174
05:00:33,350 --> 05:00:36,990
You might recall two years ago we opened up a recovery center for chronic inebriance.

3175
05:00:37,350 --> 05:00:41,990
My goal was to divert a large population of people who are arrested for

3176
05:00:41,990 --> 05:00:45,450
being drunk in public from the county jail system into a recovery center.

3177
05:00:46,150 --> 05:00:51,690
We were able to get some federal funding and partner with Janice of Santa Cruz to run the facility.

3178
05:00:51,990 --> 05:00:55,510
It's currently located in the blue house across the street on jail property.

3179
05:00:55,510 --> 05:01:19,990
And so far in about the first 18 or 19 months of operation we've diverted over a thousand people from county jail into that recovery center and Janice Santa Cruz also provides services to these folks as they're leaving and there's been a number of success stories on people who've actually accepted services and they're no longer the person who is frequently arrested and coming in and out of jail.

3180
05:01:19,990 --> 05:01:29,690
That grant expires on December 31st, and I will be proposing in the upcoming budget to continue our partnership with Janice Santa Cruz.

3181
05:01:30,250 --> 05:01:37,630
We're looking at running that facility with some reduced staffing, we're also looking at how we can increase the use of that facility.

3182
05:01:38,350 --> 05:01:48,490
As the grant is written, it was written that local police agencies had the option of taking their drunken public arrests to county jail or to the recovery center.

3183
05:01:48,490 --> 05:01:57,670
And I think moving forward, if we self-fund this, we'll make it mandatory that if a person is not fighting or violent that they will have to go to the recovery center, we won't accept them at the county jail.

3184
05:01:58,170 --> 05:02:03,510
And we're also currently accepting first time DUI offenders, and we'll make that mandatory as well.

3185
05:02:03,670 --> 05:02:14,410
And then I also think there's opportunities for people coming in, for low level drug violations, in particular under the influence of drugs, to not go into the county jail system and go into the recovery center.

3186
05:02:14,410 --> 05:02:22,670
So I think we'll be able to do it a little bit less expansively and also increase the use moving forward after we get a little more control outside of the grant.

3187
05:02:32,140 --> 05:02:36,940
Staffing has been an issue for a number of years with your board support and also the support of the CAO.

3188
05:02:38,240 --> 05:02:47,380
We've been able to refund a lot of our deputy sheriff positions that were lost during the recession as you might recall about two and a half years ago we were 22 positions down from 2006 levels.

3189
05:02:47,380 --> 05:02:52,460
And we've been able to refund 18 of those positions, so we're currently four positions down.

3190
05:02:53,600 --> 05:03:02,140
This graph shows that the narrative on the left shows that we have 126 deputies, that's not counting sergeants, lieutenants, chief deputies, or myself.

3191
05:03:02,260 --> 05:03:07,420
But we have 126 deputies shares, 122 of those positions are funded.

3192
05:03:08,280 --> 05:03:17,040
And compared from 2016 to today, our excuse me, back to 2006, we're answering about 2000 more

3193
05:03:17,040 --> 05:03:22,440
Our priority calls every year, and our population is increased by about 25,000.

3194
05:03:23,180 --> 05:03:28,120
And so what I'm working towards is at least getting to the same staffing levels we were a decade ago,

3195
05:03:28,360 --> 05:03:31,800
and I'll be asking for the refunding of those four deputy sheriff's positions.

3196
05:03:32,540 --> 05:03:38,480
The graph on the right just gives you an idea, and I understand municipal police departments are much different than sheriff's offices,

3197
05:03:38,880 --> 05:03:43,280
but just to give you an idea of geographical areas to cover population and staffing levels.

3198
05:03:43,280 --> 05:03:50,600
If you look to the far right under Capitola, they have an average of three police officers on duty per shift.

3199
05:03:51,040 --> 05:03:54,480
Each police officer serving a population of about 3,300.

3200
05:03:55,100 --> 05:04:04,300
Scott's Valley has three officers on duty in a given day, servicing a population of about 3,900 and servicing two square miles for each officer.

3201
05:04:05,080 --> 05:04:07,920
Watsonville Police Department has five officers on duty.

3202
05:04:07,920 --> 05:04:14,860
service, each officer services a population of about 10,500 people and they have one square mile they're responsible for.

3203
05:04:15,380 --> 05:04:20,980
Santa Cruz City, please, they have seven people on duty at any given time, servicing a population about 8,900.

3204
05:04:21,780 --> 05:04:25,620
And they have each officer has two square miles to patrol.

3205
05:04:26,460 --> 05:04:35,660
And the county, our deputy shares, we have about eight people on duty in patrol at any given time, servicing a population of a little over 16,000.

3206
05:04:35,660 --> 05:04:39,520
and servicing each deputy service is an area 52 square miles.

3207
05:04:46,920 --> 05:04:53,340
So under budget impacts, under some new staffing that we'll be asking for is we're going

3208
05:04:53,340 --> 05:04:59,720
to be asking to upgrade our current forensics services manager to a lab director and that's

3209
05:04:59,720 --> 05:05:01,360
part of the accreditation process.

3210
05:05:02,220 --> 05:05:08,980
As I mentioned we'll be asking to refund for deputy sheriffs and then what we found on our body

3211
05:05:08,980 --> 05:05:14,820
warrant camera system, which is working very well, by the way, that we just began full implementation

3212
05:05:14,820 --> 05:05:20,420
in January of this year. We have about 135 cameras that are in service right now, and

3213
05:05:20,420 --> 05:05:26,180
then including court security will be coming online here in the next few weeks. But there

3214
05:05:26,180 --> 05:05:31,940
are about 3,000 video segments that are being generated each month right now.

3215
05:05:35,240 --> 05:05:38,960
And what we're

3216
05:05:38,960 --> 05:06:08,940
to go through in order to attach each video segment to a report or an incident and there is an error rate and there does need to be some level of oversight on this body-worn camera system and so we're going to be asking for a property and evidence clerk to manage this this body-worn camera system to make sure that these thousands of video segments that are coming out each month or attached to the appropriate case we did do a study and some departments are saying that for every 100 cameras that they have out that they need one full time employee to manage the

3217
05:06:08,940 --> 05:06:13,480
those 100 cameras, but we think we can do the 135 cameras with one person.

3218
05:06:15,300 --> 05:06:17,320
Other needs I'd mention the recovery center.

3219
05:06:17,480 --> 05:06:21,900
We have a number of software systems that we're looking at purchasing, and most of that's

3220
05:06:21,900 --> 05:06:24,680
behind the DNA and funded with DNA trust dollars.

3221
05:06:25,620 --> 05:06:30,760
And the last thing I want to touch on, and I'm not, I almost feel bad mentioning this

3222
05:06:30,760 --> 05:06:38,700
after hearing John Presley talk about his fleet, but our fleet is, we, during the recession

3223
05:06:38,700 --> 05:06:45,760
We went five years without replacing a patrol car, and so our people drive in very dangerous situations sometimes,

3224
05:06:45,860 --> 05:06:52,140
they drive fast sometimes, and those cars were exceeding 150,000 miles on them.

3225
05:06:52,740 --> 05:06:59,400
With your boards help and the CAO's assistance, we've been able to replace our entire fleet during the last three years,

3226
05:06:59,600 --> 05:07:06,580
which has been hugely helpful, and so in this budget cycle, we're asking to continue that process,

3227
05:07:06,580 --> 05:07:09,820
and replace a third of our fleet, our patrol fleet.

3228
05:07:10,820 --> 05:07:16,160
A patrol car has a shelf life of about three years, and those cars get driven hard, and

3229
05:07:16,160 --> 05:07:18,940
they're constantly turned on and they get driven a lot of miles.

3230
05:07:19,840 --> 05:07:26,040
And so we'll be asking for patrol car replacement along with a number of investigations vehicles as well.

3231
05:07:27,640 --> 05:07:29,260
And that concludes my presentation.

3232
05:07:29,260 --> 05:07:31,400
I'm happy to answer any questions you might have.

3233
05:07:32,140 --> 05:07:33,860
The questions to

3234
05:07:35,980 --> 05:07:36,720
revise them will be here soon.

3235
05:07:38,040 --> 05:07:41,120
Congratulations on doing a great job with the amount of W's you have.

3236
05:07:41,300 --> 05:07:48,300
I hope we can help again this year with the Cotani Cotani Cotani Costari's National Park.

3237
05:07:48,840 --> 05:07:53,320
I do hope this agreement with some private partner's works.

3238
05:07:54,580 --> 05:07:58,180
I think there's no question that the people of Santa Cruz County was excited about this

3239
05:07:58,180 --> 05:08:04,540
becoming a national monument but at the same time was scared that the fallback was going

3240
05:08:04,540 --> 05:08:09,140
be that we were going to have to be the ones to patrol it. And there's, um, those people

3241
05:08:09,140 --> 05:08:13,480
are going to come one way or the other. There's no way you can, but we just have to pressure

3242
05:08:13,480 --> 05:08:19,320
the federal government to try to, uh, to police that area if necessary. Is there, what

3243
05:08:19,320 --> 05:08:21,100
chance in the world would there be to do that?

3244
05:08:21,580 --> 05:08:26,660
You know, I've, I've met with, uh, with BLM on a number of occasions. And, uh, the outlook

3245
05:08:26,660 --> 05:08:32,940
is, is really gram. I, they're, they're making absolutely no promises. And, uh, in fact,

3246
05:08:32,940 --> 05:08:35,660
They're pretty clear that they won't be adding staffing.

3247
05:08:36,260 --> 05:08:40,280
I don't know if the CAO's hearing any differently, but at least in my conversations,

3248
05:08:40,380 --> 05:08:44,160
I'm not hearing about any additional staffing up on that property.

3249
05:08:44,460 --> 05:08:47,600
It's my understanding they have four rangers for an 11 county area.

3250
05:08:48,820 --> 05:08:52,620
And so with that, if there's a search and rescue situation, or

3251
05:08:52,620 --> 05:08:55,900
there's an injury in the park, or there's some sort of a criminal activity.

3252
05:08:56,480 --> 05:09:00,720
I really think it's going to fall on the sheriff's office to respond up there and manage that incident.

3253
05:09:00,720 --> 05:09:05,720
And not to mention, as I had said before, all the impacts on the town and down

3254
05:09:05,720 --> 05:09:08,380
on board and the surrounding areas from that level of tourism.

3255
05:09:08,980 --> 05:09:12,780
Well, I imagine my colleague, Ryan Cooner, has his concerns.

3256
05:09:12,780 --> 05:09:14,300
I know about that too.

3257
05:09:14,460 --> 05:09:19,700
And just to get the status, to get some of the language in that whole national

3258
05:09:19,700 --> 05:09:24,620
monument procedure to have a plan in place and all that will help.

3259
05:09:24,880 --> 05:09:29,260
But as far as public safety services, I'm really concerned about that.

3260
05:09:29,260 --> 05:09:37,740
We're not going to have, it's going to create some problems, but I just, I think that the recovery center is terrific.

3261
05:09:38,160 --> 05:09:41,540
I'm glad to see we're pursuing that and continuing to go down that line.

3262
05:09:41,680 --> 05:09:47,760
It seems to be a long time winner for everybody, not only budget wise, but for the people involved as well.

3263
05:09:48,140 --> 05:09:48,400
Thank you.

3264
05:09:51,610 --> 05:09:52,850
I had a couple questions.

3265
05:09:55,350 --> 05:09:56,950
I appreciate the presentation.

3266
05:09:56,950 --> 05:10:03,790
I really like, you and I have talked a lot about the rehabilitation and reentry facility

3267
05:10:03,790 --> 05:10:11,690
and where you're going with that, and I think that's where we need to be if we really want to turn the curve

3268
05:10:12,910 --> 05:10:15,830
on some of the recidivism that we see in our community.

3269
05:10:15,970 --> 05:10:17,810
So I really appreciate what you're doing there.

3270
05:10:18,430 --> 05:10:23,930
I know that the shooting range in the public safety campus

3271
05:10:23,930 --> 05:10:29,390
that was it's I've seen I've seen the shell you mentioned that you've been putting

3272
05:10:29,390 --> 05:10:33,030
way money I couldn't get in the sense whether you were going to ask for money or

3273
05:10:33,030 --> 05:10:38,790
whether you thought that you would be in a squirrel win enough dollars to be

3274
05:10:38,790 --> 05:10:43,550
able to do that yourself whatever it was five years ago they said it was a

3275
05:10:43,550 --> 05:10:46,570
million dollars I'm not sure what it cost today yeah it's it's somewhere in that

3276
05:10:46,570 --> 05:10:50,390
neighborhood between a million a million five and and what I'm trying to do is

3277
05:10:50,390 --> 05:10:53,230
build up some of these trusts so that we don't have any kind of a general fund

3278
05:10:53,230 --> 05:10:56,850
ask on this? Well, I can tell you, we appreciate that.

3279
05:10:59,030 --> 05:11:02,030
You mentioned about the DNA lab. Again,

3280
05:11:02,130 --> 05:11:09,490
I know that that was a long-term interest of the scientist building on the campus. Is there

3281
05:11:09,490 --> 05:11:14,930
any possibility of us getting resources from our neighboring cities who might be able to

3282
05:11:14,930 --> 05:11:21,890
use the DNA lab as a way of helping pay for it? Yeah, and I didn't mention that, but I believe

3283
05:11:21,890 --> 05:11:28,830
I believe that we would be able to contract out services to some of our law enforcement partners right now, Santa Query County Sheriff's Office.

3284
05:11:29,510 --> 05:11:39,710
They have a DNA lab and they contract out with a lot of their city partners and so I see that occurring here and it would definitely offset some of the expenditures on that.

3285
05:11:40,270 --> 05:11:47,850
Yeah, I mean I think that would be helpful and hopefully it means that they could get their information that quicker so that would be a win-win situation.

3286
05:11:47,850 --> 05:11:53,370
On the recovery center, you know, I think we're moving in the right direction in the 1,000

3287
05:11:53,370 --> 05:11:53,850
diversions.

3288
05:11:54,210 --> 05:11:56,090
It's very impressive and requiring it.

3289
05:11:57,830 --> 05:12:00,910
I think we're long past the point where that's a good idea.

3290
05:12:01,030 --> 05:12:02,110
I think that's an excellent idea.

3291
05:12:03,330 --> 05:12:08,530
The staffing issue is, you know, the board has invested a lot in staffing over the last

3292
05:12:08,530 --> 05:12:09,110
couple of years.

3293
05:12:09,210 --> 05:12:11,210
I think of 17 or more positions.

3294
05:12:11,210 --> 05:12:25,430
The statistics as you mentioned are hard to do an apple to apples comparison because municipal forces generally have better coverage of their more discrete cities than counties do.

3295
05:12:26,050 --> 05:12:32,150
Do we have statistics or could you provide statistics about what sheriff's departments look like?

3296
05:12:33,090 --> 05:12:35,810
You know, we compare ourselves to other counties all the time.

3297
05:12:35,810 --> 05:12:39,150
And there's these eight counties that we compare ourselves.

3298
05:12:39,590 --> 05:12:41,390
How do we look compared to those counties?

3299
05:12:42,130 --> 05:12:44,730
Yeah, and that's a good question, and each county's different.

3300
05:12:44,950 --> 05:12:52,390
Our county's a little bit unique in that a vast majority of our population lives in the unacorporated area of the county,

3301
05:12:52,410 --> 05:12:56,390
where it's say Santa Clara, most of their population lives in city jurisdictions.

3302
05:12:56,970 --> 05:13:02,190
And so we could do some research to find out service populations for

3303
05:13:02,190 --> 05:13:04,530
sheriff's offices and try to find comparisons.

3304
05:13:05,190 --> 05:13:20,490
We are intending, or we've applied for California Commission on Police Officer Standard and Training for them to come in here and give us a staffing assessment, which would sort of be a guide to where we're at and where we could be or might be moving forward.

3305
05:13:21,650 --> 05:13:28,890
We've asked for that service, they did it in corrections for, excuse me, they did it in our records division one year in the report was hugely helpful.

3306
05:13:28,890 --> 05:13:40,770
And so it just takes a while for them to catch up on their lists of requests, but they'll be coming in the next year or two and giving us an idea based on their formulas and their numbers.

3307
05:13:41,490 --> 05:13:50,530
Yeah, it's our deputies are really valuable members of the county family and they're also expensive members of the county family.

3308
05:13:50,710 --> 05:13:57,430
So trying to find that balance and what we might be able to give compared to all these other requests.

3309
05:13:57,430 --> 05:14:02,410
that's that all obviously becomes the hard part of our whole piece because I don't

3310
05:14:04,170 --> 05:14:10,030
just looking at all these requests you could say yeah we need them all and just

3311
05:14:10,030 --> 05:14:14,810
like Director Presley and I'm sure we'll hear from the other directors about

3312
05:14:14,810 --> 05:14:19,130
the needs and just trying to figure out what size of requests if we're looking

3313
05:14:19,130 --> 05:14:24,310
for given our resources is always the big issue. I understand and we're

3314
05:14:24,310 --> 05:14:26,710
We're continually seeking out grant opportunities.

3315
05:14:27,410 --> 05:14:34,390
We just applied for a prop 47 grant that could bring some resources to corrections and I think there's going to be other opportunities moving forward.

3316
05:14:35,050 --> 05:14:40,470
Problem with a lot of the federal level grants is that they really focus on municipalities and not so much on county jurisdictions.

3317
05:14:41,050 --> 05:14:42,570
Yeah, I know that that's been an issue.

3318
05:14:42,830 --> 05:14:49,370
I have seen the Sheriff's Department in the last couple years go for a lot more grant money than they have historically, so I appreciate that.

3319
05:14:49,630 --> 05:14:53,730
And it's part of the innovative way in what you're doing, so I appreciate that as well.

3320
05:14:53,730 --> 05:14:59,530
Thank you other questions seeing none I'll say thank you to the sheriff and

3321
05:15:00,560 --> 05:15:02,860
Say hello to the chief. Thank you.

3322
05:15:10,590 --> 05:15:27,530
Turn on the mic here and set on. Okay, good afternoon, Chair Leopold, supervisors, Ms. Morello, and Mr. Policios, and members of the community. I want to thank you for the opportunity to address you today regarding the matters related to the county fire department and emerging and critical issues.

3323
05:15:31,730 --> 05:15:40,750
I'd like to start with our emerging issues with our response capabilities. We continue to see an increase in the total number of calls for service in the county fire area.

3324
05:15:40,750 --> 05:15:46,250
In the past 10 years, we've experienced an increase of just over 800 responses for service

3325
05:15:46,250 --> 05:15:46,690
annually.

3326
05:15:47,830 --> 05:15:52,010
This increase calls for services and the complexity of the instance that we respond

3327
05:15:52,010 --> 05:15:57,870
to can lead to resource availability concerns and result in slower response times and the

3328
05:15:57,870 --> 05:15:59,910
reliance on mutual aid from other agencies.

3329
05:16:00,730 --> 05:16:07,510
An example, the North Coast, we're experiencing an increase in calls for rescue along the

3330
05:16:07,510 --> 05:16:09,610
cliff sides and the roadways on the North Coast.

3331
05:16:09,610 --> 05:16:19,630
Those types of incidents require us to commit resources for extensive period of time dealing with those complex types of calls for clip rescues and auto extrications.

3332
05:16:21,960 --> 05:16:25,620
Santa Cruz County currently sees approximately 3 million visitors annually.

3333
05:16:26,460 --> 05:16:35,320
And with a recent declaration of the Kontini Coast area's national monument and the potential for an additional several hundred thousand visitors to the area,

3334
05:16:35,320 --> 05:16:43,700
This will only add to that increased traffic congestion that we already experience as well as add to the increased calls for services in the county.

3335
05:16:44,560 --> 05:16:49,820
This will most likely lead to significant impacts for us to be able to provide timely response for service.

3336
05:16:50,780 --> 05:16:57,340
In addition, there's no increase for funding for the County Fire Department with the National Monument designation.

3337
05:16:58,680 --> 05:17:04,380
And it does not provide for any funding for response for calls for service in that general area as well.

3338
05:17:04,380 --> 05:17:05,380
All right,

3339
05:17:13,280 --> 05:17:17,740
our second emerging issue that we are dealing with is the Cal Fire contract.

3340
05:17:18,380 --> 05:17:24,220
Our Cal Fire Labor Group, local 2080-1, as well as our associated staff bargaining units

3341
05:17:24,220 --> 05:17:28,960
have negotiated new labor agreements that include an increase in compensation.

3342
05:17:30,040 --> 05:17:36,480
Additionally, the staff benefit rates are anticipated to increase as well, which will reflect in

3343
05:17:36,480 --> 05:17:40,100
the cost associated with the cooperative agreement with Cal Fire for services.

3344
05:17:41,120 --> 05:17:45,860
In addition to this, the state also is continuing to look at how the cooperative agreements

3345
05:17:45,860 --> 05:17:51,240
are structured to reach a cost alignment standard to balance the state's commitment of resources

3346
05:17:51,580 --> 05:17:52,400
to such agreements.

3347
05:17:53,340 --> 05:17:58,420
At this time, we're really not sure how this is going to impact the county fire department

3348
05:17:58,420 --> 05:17:59,120
in the future.

3349
05:18:04,080 --> 05:18:07,860
Moving on to some critical issues that we're to address.

3350
05:18:08,340 --> 05:18:10,100
First I want to start with our staffing model.

3351
05:18:10,100 --> 05:18:15,040
Currently, our staffing model in the county fire department is out of a combination model.

3352
05:18:15,740 --> 05:18:21,980
A combination model consists of volunteer firefighters that are primary service delivery means for the county fire department,

3353
05:18:22,220 --> 05:18:25,420
and they are supplemented by paid cal fire firefighters.

3354
05:18:26,420 --> 05:18:31,460
On a national level, there continues to be a decrease in public volunteering.

3355
05:18:32,580 --> 05:18:37,320
The National Fire Protection Association reports since 1986,

3356
05:18:37,320 --> 05:18:42,020
statistics, the number of career firefighters per thousand population has stayed constant.

3357
05:18:43,200 --> 05:18:48,740
What they are seeing is that same relevance for volunteer firefighters per thousand

3358
05:18:48,740 --> 05:18:50,400
population is decreasing.

3359
05:18:51,620 --> 05:18:55,120
Some of the reasons for the decline are associated with cost of living.

3360
05:18:56,120 --> 05:19:01,800
Many families today rely on a dual income, both parents having to work to provide and meet

3361
05:19:01,800 --> 05:19:02,360
their needs.

3362
05:19:02,940 --> 05:19:06,380
The days of living and working in your community are not.

3363
05:19:07,000 --> 05:19:12,740
People are having to change to that community society where they're on the road traveling to work,

3364
05:19:13,240 --> 05:19:16,620
which also reduces their time to be able to give back to their communities.

3365
05:19:17,840 --> 05:19:25,160
A notable reason in the time commitment is those requirements to meet standardized training.

3366
05:19:25,160 --> 05:19:35,560
And today's standards, volunteer firefighters, need to meet the same exact requirements that paid professional firefighters have, which is a tremendous time commitment on them.

3367
05:19:36,840 --> 05:19:44,940
Here locally the county fire department has seen an approximate 40% reduction in our volunteer firefighting force since 2008-2009.

3368
05:19:45,620 --> 05:19:54,120
We're in the process of establishing better methods of identifying why members are leaving and separating service so we can improve our recruitment and retention efforts.

3369
05:19:59,200 --> 05:20:21,160
One of the reasons that we have been able to identify is the recruitment of our new volunteers that are younger members are in the pursuit of a career in the fire service as a professional, and what we're finding as as they're successful in obtaining a career in the fire service, those new employees are not allowing them to volunteer any longer.

3370
05:20:21,160 --> 05:20:25,980
There's a lot of different requirements with purrs and workers compensation that does

3371
05:20:25,980 --> 05:20:29,440
not allow them to provide those same services elsewhere.

3372
05:20:32,320 --> 05:20:37,960
We've also seen a reduction in the number of paid firefighters from 24-18 during the

3373
05:20:37,960 --> 05:20:40,940
Amateur Contract period since 2008-2009.

3374
05:20:41,620 --> 05:20:46,320
This reduction has diminished our abilities to meet NFPA standards for deployment of fire

3375
05:20:46,320 --> 05:20:49,880
service operations for a combination fire department.

3376
05:20:51,340 --> 05:20:57,920
NFPA 1720 is a standard used for combination fire departments that sets the standard

3377
05:20:57,920 --> 05:21:05,360
for response to a standard residential structure fire in rural areas which states that we should

3378
05:21:05,360 --> 05:21:12,040
be needing six firefighters at the scene of the fire in 14 minutes, 80% of the time.

3379
05:21:12,900 --> 05:21:25,800
And suburban areas, which is all based on population base, which is a service area 500 to 1,000 folks for their study, increases that response to 10 firefighters in 10 minutes, 80% of the time.

3380
05:21:26,500 --> 05:21:38,900
So current staffing levels that we see in county fire associated with the paid staff and the volunteer responses, we're only able to provide 4.3 responders per fire in the 14-minute time frame.

3381
05:21:38,900 --> 05:21:42,340
the National Fire Protection Association recommends.

3382
05:21:42,940 --> 05:21:48,900
The remainder of the staffing comes from outside the time frames and usually is from the

3383
05:21:48,900 --> 05:21:51,320
Mutual Aid Department providing aid to us.

3384
05:21:52,520 --> 05:21:58,320
The reduction in staffing has greatly impacted our ability to ensure a timely response that

3385
05:21:58,320 --> 05:22:03,120
allows sufficient number of firefighters to operate safely and effectively on the scene

3386
05:22:03,120 --> 05:22:04,560
of an emergency incident.

3387
05:22:05,260 --> 05:22:08,620
Providing safety for our responders and the public is our number one priority.

3388
05:22:10,040 --> 05:22:13,040
On your staffing is-

3389
05:22:13,040 --> 05:22:14,960
Can we finish the presentation?

3390
05:22:15,060 --> 05:22:16,360
We have a lot of stuff to do today.

3391
05:22:16,540 --> 05:22:18,720
I want to finish the presentation and then we'll do the questions.

3392
05:22:21,000 --> 05:22:26,260
Our next issue that's critical for us is our deferred maintenance of our facilities.

3393
05:22:26,940 --> 05:22:29,500
Due to years of deferred maintenance of the county fire facilities,

3394
05:22:29,500 --> 05:22:33,680
we're experiencing a significant increase in the cost for repairs and maintenance.

3395
05:22:33,680 --> 05:22:38,980
An example is our Fall Creek Rift Repair and Replacement Project.

3396
05:22:39,600 --> 05:22:43,960
Once the evaluation process has started for that facility to determine what the needs

3397
05:22:43,960 --> 05:22:50,040
were going to be, the facility we were able to determine needed several additional items

3398
05:22:50,040 --> 05:22:53,740
addressed to bring the facility into compliance with current code.

3399
05:22:55,040 --> 05:23:00,680
We anticipate a 55% increase in the overall cost from our budgeted figure of $75,000 for

3400
05:23:00,680 --> 05:23:02,280
that roof replacement and repairs.

3401
05:23:03,220 --> 05:23:07,740
The current process used to determine the needs for that repair and maintenance are

3402
05:23:07,740 --> 05:23:11,820
very time-consuming to be able to get the engineer reports and everything needed to actually

3403
05:23:11,820 --> 05:23:17,040
get the bids out and get those bids returned has resulted in repair and maintenance costs

3404
05:23:17,040 --> 05:23:20,320
increasing significantly from originally budgeted estimates.

3405
05:23:21,600 --> 05:23:24,920
Our next item is our Mobile Equipment Replacement Plan.

3406
05:23:25,420 --> 05:23:30,660
The County Fire Department, as other departments within the county, we have a lot of equipment

3407
05:23:30,660 --> 05:23:32,200
that needs replacing over time.

3408
05:23:32,740 --> 05:23:38,200
These fire engines respond to emergency calls for service day in and day out.

3409
05:23:38,640 --> 05:23:41,720
Currently, we do not have an adopted mobile equipment replacement plan.

3410
05:23:42,440 --> 05:23:44,140
We refer to this as a MIRP.

3411
05:23:44,680 --> 05:23:50,760
The county fire department's fleet is aging and requires more maintenance as the years go on.

3412
05:23:51,840 --> 05:23:57,120
The cause of these maintenance and repairs increases the out of service time for

3413
05:23:57,120 --> 05:24:00,000
of these vehicles, as well as reduces the availability

3414
05:24:00,000 --> 05:24:02,140
of that vehicle to respond to emergency calls.

3415
05:24:03,180 --> 05:24:05,380
Though the County Fire Department has been able to purchase

3416
05:24:05,380 --> 05:24:07,880
a few new fire engines over the past few years,

3417
05:24:08,560 --> 05:24:10,900
as a result of money saved in the cooperative fire

3418
05:24:10,900 --> 05:24:12,340
protection agreement with Cal Fire,

3419
05:24:12,700 --> 05:24:16,280
these savings are a direct reflection of the drought.

3420
05:24:17,200 --> 05:24:19,940
As a drought is coming to an end,

3421
05:24:20,040 --> 05:24:21,900
and our fire seasons may not be as long,

3422
05:24:22,280 --> 05:24:23,660
we may not see those savings.

3423
05:24:24,420 --> 05:24:26,340
These savings are not a sustainable method

3424
05:24:26,340 --> 05:24:29,900
or replacement for the approved mobile equipment replacement plan.

3425
05:24:30,640 --> 05:24:35,340
With out reliable fire apparatus to respond to emergencies, our communities are at risk.

3426
05:24:38,280 --> 05:24:40,700
And our last item is long term funding.

3427
05:24:42,080 --> 05:24:45,640
The county fire department is not a general fund department.

3428
05:24:45,860 --> 05:24:51,520
It relies solely on property taxes and a 1997 voter approved assessment fee.

3429
05:24:52,040 --> 05:24:56,220
And then we also see some funding from grants when we're successful in that application process.

3430
05:24:57,380 --> 05:25:01,020
The county fire department continues year after year to struggle with funding.

3431
05:25:01,500 --> 05:25:13,160
As a direct result of the drought, county fire has been able to sustain the current service delivery system due to savings in that cooperative fire protection agreement with the extended fire seasons of Cal Fire.

3432
05:25:13,620 --> 05:25:22,900
County fires in the process of developing information to conduct a tax poll to gather additional information from our communities to determine our next option.

3433
05:25:22,900 --> 05:25:27,800
option, that option could be in resultant in a ballot to the voters for more funding.

3434
05:25:29,220 --> 05:25:34,940
Other options that are under review and discussion is the Lathco fire study for possible consolidation

3435
05:25:35,280 --> 05:25:42,140
of fire service agencies, as well as the distribution of state proposition 172 funds and the voter

3436
05:25:42,140 --> 05:25:43,800
approved measure K funds.

3437
05:25:43,800 --> 05:25:55,000
Both Prop 172, the 1993 tax increase in the Major K, the 2014 marijuana tax measures were approved by the voters to be used for public safety.

3438
05:25:55,320 --> 05:25:56,440
That includes fire departments.

3439
05:25:57,420 --> 05:26:03,740
However, the county fire department does not directly receive any funds from either funding source for any of our operations.

3440
05:26:05,080 --> 05:26:11,920
And in closing, without a long-term solution of our funding problems for the county fire department, we will struggle to continue with emergency services.

3441
05:26:13,800 --> 05:26:14,440
Thank you, Chief.

3442
05:26:14,800 --> 05:26:17,220
I know Supervisor Capitad had questions.

3443
05:26:20,500 --> 05:26:26,960
You said three firefighters versus two firefighters currently.

3444
05:26:26,960 --> 05:26:27,720
Where are you?

3445
05:26:28,020 --> 05:26:28,800
We're at two firefighters.

3446
05:26:29,140 --> 05:26:37,120
So when we had that staffing reduction in 2008, 2009, we went from three-o staffing to two-o staffing.

3447
05:26:37,220 --> 05:26:41,880
So we have two persons on the engine now versus what we had in 2008, 2009, where we had three.

3448
05:26:42,380 --> 05:26:47,180
That's the state mandate really calls for what, two in, two out?

3449
05:26:47,360 --> 05:26:51,660
Two in, two out is a mandate that we have for responding to structure fires.

3450
05:26:51,900 --> 05:26:56,480
So, when you respond in and make entry into a fire, you need to have, for every two persons,

3451
05:26:56,480 --> 05:26:57,860
and you need to have two persons out.

3452
05:26:58,180 --> 05:27:01,520
Right. So, actually, you're running out about a half staff.

3453
05:27:02,500 --> 05:27:02,680
Yes.

3454
05:27:03,760 --> 05:27:06,780
Wow. That's rough. That's rough. Okay. Thank you.

3455
05:27:07,020 --> 05:27:07,180
All right.

3456
05:27:10,320 --> 05:27:15,940
Not to get on the, of course, Derri's thing, but this is a concern, again, I think I can see that we're going to be called,

3457
05:27:16,180 --> 05:27:23,720
you're going to be called for emergencies that you can't fund so much, but, and then we blame for the, if you can't get there in time.

3458
05:27:26,320 --> 05:27:33,600
Exactly. It's going to be very difficult, especially that influx of, of populace or tourism that's going to come to that area.

3459
05:27:33,600 --> 05:27:39,400
The numbers of people we're talking about are just going to be tremendous and it's going to be very difficult for as far as

3460
05:27:39,400 --> 05:27:46,260
Increased revenue. I mean you see that probably the most realistic way to go is just to call for ask for another tax

3461
05:27:47,940 --> 05:27:53,180
You don't know you don't want to it's going to be very difficult as we've seen in the previous pollings that we've done

3462
05:27:53,700 --> 05:27:56,460
It sometimes is not a favorable option

3463
05:27:57,100 --> 05:28:02,900
But um, well, hopefully when we get done with our polling will be able to determine if that's going to be a favorable option or not

3464
05:28:02,900 --> 05:28:08,040
And this doesn't have anything to do with this, 172, prop 172 funding.

3465
05:28:09,020 --> 05:28:11,980
You don't have any, you don't have any to do with 172.

3466
05:28:12,180 --> 05:28:14,900
We receive no funding from prop 172.

3467
05:28:15,320 --> 05:28:16,220
They would like it.

3468
05:28:16,520 --> 05:28:17,500
Yeah, they would like it, okay.

3469
05:28:19,500 --> 05:28:20,900
I just had a couple questions.

3470
05:28:21,840 --> 05:28:27,180
You mentioned in your first slide, I think, that the state is looking at these cooperative agreements.

3471
05:28:27,480 --> 05:28:31,980
So we realize here in Santa Cruz County, we have a great cooperative agreement with Cal Fire.

3472
05:28:31,980 --> 05:28:37,780
Can you give us any more information about what might be under consideration there?

3473
05:28:38,000 --> 05:28:45,720
Yeah, the state has been looking at how those agreements are structured and how and what type of resources are utilized in those contracts.

3474
05:28:46,020 --> 05:29:01,400
So for example, a cooperative agreement such as the one in Santa Cruz County where we utilize Firefighter 1s as a staffing model may not be allowable long term.

3475
05:29:01,400 --> 05:29:08,400
They may be looking at a different classification more of a permanent firefighter position versus a seasonal firefighter position.

3476
05:29:08,880 --> 05:29:16,280
They're already doing that in our Schedule A contracts where they have re-evaluated that position that can't be utilized in that long-term funding.

3477
05:29:16,860 --> 05:29:22,180
So, if it's permanent firefighter position, what exactly does that mean for us then?

3478
05:29:22,880 --> 05:29:27,860
Well, it would mean an increase in cost, but those positions can be permanent intermittent.

3479
05:29:27,860 --> 05:29:31,740
So they would be a permanent employee, but they would be intermittently employed.

3480
05:29:32,000 --> 05:29:48,720
Okay. All right. And then when you talked about the repair estimates, the cost going up a lot more for your structures, is that have anything to do with requirements that our planning department has or is it other requirements beyond that?

3481
05:29:48,720 --> 05:29:59,980
No more so, I think it is when we come up with a budgeted figure, and by the time we get around to having all of the required elements, the engineering reports, and get it to...

3482
05:30:01,740 --> 05:30:23,260
And in this case, for a lot of our facilities, when we get there, we're specifically budgeting for one item to be repaired, for example, the roof at Fall Creek. By the time we expanded that and we inspected the facility more thoroughly, it needed to have sighting and everything else brought up to code at that same time. So those are increasing the cost because of that deferred maintenance.

3483
05:30:24,120 --> 05:30:30,080
Well, I'll just say, you know, county fire, I know it's not a mandated service for the

3484
05:30:30,080 --> 05:30:36,960
county to provide, RCAO reminds us of that regularly, but we know that our rural residents

3485
05:30:36,960 --> 05:30:43,920
without this fire service would not be able to get insurance on their homes.

3486
05:30:44,520 --> 05:30:50,980
They wouldn't be able to sell them and not to mention this, the great work that the fire

3487
05:30:50,980 --> 05:30:56,400
firefighters play in these communities. So we have a big challenge ahead of us in this next year

3488
05:30:57,180 --> 05:31:02,660
trying to figure out a long-term funding strategy for county fire. And I'm committed to working

3489
05:31:02,660 --> 05:31:05,900
on it and I hope my colleagues are because it's going to take all of us to figure it out.

3490
05:31:08,690 --> 05:31:14,690
There's no more questions. I'm going to suggest we take a 10-minute break. We've been here for a couple

3491
05:31:14,690 --> 05:31:21,230
flowers and I think would be helpful and so we'll be back at about five or four.

3492
05:36:43,480 --> 05:36:49,620
We return maybe for the last time today for the February 28th Board of Supervisors meeting

3493
05:36:49,620 --> 05:36:56,740
study session. I believe that our next is Health and Human Services, Mr. Palacios, do

3494
05:36:56,740 --> 05:37:01,520
you want to make any introductions? No, I don't. There we go.

3495
05:37:03,840 --> 05:37:04,800
Well, they've got a little

3496
05:37:04,800 --> 05:37:06,400
I'll be salty here at the end of the day.

3497
05:37:10,710 --> 05:37:12,290
Good afternoon, Ms. Denver Lake.

3498
05:37:12,450 --> 05:37:14,610
Good afternoon, Chair Leopold, members of the board.

3499
05:37:14,830 --> 05:37:17,330
I'm Ellen Timberlake, interim director of the Human Services Department.

3500
05:37:17,970 --> 05:37:21,870
Thank you for the opportunity to address three emerging federal and state budget issues

3501
05:37:21,870 --> 05:37:26,290
that will significantly impact our department in fiscal year 17-18 and beyond.

3502
05:37:26,910 --> 05:37:28,110
I'll start at the federal level.

3503
05:37:29,770 --> 05:37:35,790
As the Assistant CIO mentioned in his remarks, the uncertainty surrounding the repeal and replacement of the Affordable Care Act

3504
05:37:35,790 --> 05:37:38,030
is a critical emerging issue for our county.

3505
05:37:38,730 --> 05:37:43,530
Depending on what is passed and signed into law, we anticipate widespread consequences and impacts.

3506
05:37:44,370 --> 05:37:48,990
Since the implementation of ACA, covered California has been a leader at the national level,

3507
05:37:49,190 --> 05:37:52,430
enrolling record numbers of our fellow citizens into healthcare plans.

3508
05:37:53,150 --> 05:37:57,590
Couple with the successful expansion of Medi-Cal to cover non-disabled and childless adults.

3509
05:37:58,270 --> 05:38:04,710
California has reduced the number of residents in half, the largest decline in the uninsured rate of any state in the country.

3510
05:38:04,710 --> 05:38:12,570
In Santa Cruz County, we reduced that number by 67% with just over 13,000 uninsured in 2016.

3511
05:38:13,330 --> 05:38:19,010
This success has been supported through enhanced federal funding that if eliminated or reduced,

3512
05:38:19,270 --> 05:38:22,330
shifts significant costs back to the states and county.

3513
05:38:24,520 --> 05:38:30,360
As outlined in the initial House GOP replacement plan that was released earlier this month,

3514
05:38:30,560 --> 05:38:34,340
that although congressional actions remain uncertain at this time,

3515
05:38:34,340 --> 05:38:38,240
The general prohibitions of this plan make changes to tax credits,

3516
05:38:38,840 --> 05:38:42,600
expand existing limits on health care savings accounts, and

3517
05:38:42,600 --> 05:38:46,640
slowly dismantle enhanced federal funding for the Medicaid expansion program.

3518
05:38:48,730 --> 05:38:49,070
See,

3519
05:38:52,280 --> 05:38:54,780
too fast on the take here.

3520
05:38:54,900 --> 05:39:07,140
Depending on the final provisions of any new law, over 14,000 Santa Cruz County residents who enrolled and covered California health plans could see some facet of their costs and quality of their coverage impacted.

3521
05:39:07,140 --> 05:39:13,300
It, an additional 21,000 individuals newly eligible for coverage through medical expansion

3522
05:39:13,300 --> 05:39:14,720
could also lose coverage.

3523
05:39:15,260 --> 05:39:19,940
This group makes up almost 30% of our county's entire medical population.

3524
05:39:20,520 --> 05:39:24,960
If this program was eliminated, health care for these new beneficiaries would likely shift

3525
05:39:24,960 --> 05:39:25,760
back to the county.

3526
05:39:26,700 --> 05:39:31,760
There are also secondary benefit enrollment impacts if the expanded program were eliminated.

3527
05:39:31,760 --> 05:39:37,920
For example, under Senate Bill 75, the state established access for undocumented children

3528
05:39:37,920 --> 05:39:40,760
in California to receive full scope Medi-Cal.

3529
05:39:41,360 --> 05:39:46,000
In Santa Cruz County, 750 children are now benefiting from this program.

3530
05:39:46,740 --> 05:39:51,700
If the federal government eliminates coverage for the expanded population, optional programs

3531
05:39:51,700 --> 05:39:53,900
like SB 75 may be at risk.

3532
05:39:54,860 --> 05:39:59,300
Additionally, many single individuals who signed up for Medi-Cal through the expansion program,

3533
05:39:59,300 --> 05:40:01,820
have enrolled in CalFresh or general assistance.

3534
05:40:02,510 --> 05:40:05,900
We anticipate enrollment declines in these benefit programs

3535
05:40:06,230 --> 05:40:08,700
if the expansion program is negatively impacted.

3536
05:40:09,660 --> 05:40:11,280
With regard to workforce impacts,

3537
05:40:11,680 --> 05:40:14,120
any move to restrict access to Medi-Cal

3538
05:40:14,510 --> 05:40:17,340
or reduce federal financial participation levels

3539
05:40:17,750 --> 05:40:19,800
would likely impact our allocation

3540
05:40:19,800 --> 05:40:21,760
which in turn would affect our staffing levels.

3541
05:40:22,650 --> 05:40:25,360
It would also create a costly untangling

3542
05:40:25,360 --> 05:40:27,180
and reprogramming nightmare

3543
05:40:27,180 --> 05:40:31,520
measure of many of our automated benefit systems that help us establish eligibility.

3544
05:40:33,870 --> 05:40:38,090
With uncertainty at the federal level, the governor's proposed 1718 budget is based

3545
05:40:38,090 --> 05:40:42,630
on a current law structure, which means he incorporates no assumptions related to any

3546
05:40:42,630 --> 05:40:43,730
future ACA actions.

3547
05:40:44,770 --> 05:40:48,530
HSD's proposed fiscal year 1718 budget follows suit.

3548
05:40:49,750 --> 05:40:54,610
We've included this chart of current sharing ratios in the medical expansion program to

3549
05:40:54,610 --> 05:40:57,350
and illustrate potential impacts should this be eliminated.

3550
05:40:58,030 --> 05:41:03,290
As you can see, fiscal year 1718 is the first year that the state is slated to pick up

3551
05:41:03,290 --> 05:41:05,110
a 5% share per room cost.

3552
05:41:05,570 --> 05:41:12,370
This 5% share represents $1.6 billion in state general fund with a total medical expansion

3553
05:41:12,370 --> 05:41:14,150
budget of $18.9 billion.

3554
05:41:15,050 --> 05:41:20,030
Under the current version of the House GOP plan, enhanced federal participation is reduced

3555
05:41:20,030 --> 05:41:29,650
from 95% to 50% in 2020, leaving significant funding gaps at the state level, and likely shifting costs for this population back to the counties.

3556
05:41:30,670 --> 05:41:42,490
Other proposed Medicaid changes like block granting or per capita financing would also lock states into historic spending patterns and force the state to re-evaluate and prioritize medical eligibility.

3557
05:41:44,350 --> 05:41:48,390
Now, I'll move on to two emerging issues identified in the governor's proposed budget

3558
05:41:48,390 --> 05:41:51,870
that we'll have significant impacts on our department and the county general fund.

3559
05:41:53,610 --> 05:41:56,690
Let's start with the proposed cuts to the CalWORK signal location.

3560
05:41:57,330 --> 05:42:01,870
The California Work Opportunity and Responsibility to Kids, or CalWORK's program,

3561
05:42:02,470 --> 05:42:07,890
offers temporary cash assistance and employment services to eligible families who have children under the age of 19.

3562
05:42:08,510 --> 05:42:10,950
This is California's version of the federal TANF program.

3563
05:42:10,950 --> 05:42:20,490
The CalWORK's allocation supports four functions, eligibility, employment services, childcare, and our Cal Learn program, which serves the pregnant and parenting teams.

3564
05:42:21,230 --> 05:42:26,610
Under the Governor's proposed budget, next year's CalWORK's allocation will be reduced by 10%.

3565
05:42:26,610 --> 05:42:38,690
This reduction is on top of a current year allocation cut of 8% and is based on projected decreases in caseloads statewide, resulting from an improved economy and declining unemployment rates.

3566
05:42:38,690 --> 05:42:45,400
The back-to-back reductions in allocations will have significant impacts on our department

3567
05:42:45,400 --> 05:42:49,660
and the families we support, including proposed adjustments to our service model and the

3568
05:42:49,660 --> 05:42:51,240
unfunding of some vacant positions.

3569
05:42:52,020 --> 05:42:56,660
Reductions in the level of support for optional post-aid services like transportation and housing

3570
05:42:56,660 --> 05:42:57,160
subsidies.

3571
05:42:58,320 --> 05:43:02,080
Reductions and reductions in contract funding for some partner agencies.

3572
05:43:02,680 --> 05:43:06,940
Over a two-year period, the impact of these allocation cuts is $2.4 million.

3573
05:43:09,810 --> 05:43:19,550
The third emerging issue that has enormous implications for our budget and for all county departments is the elimination of the in-home support services, maintenance of effort or MOA.

3574
05:43:20,170 --> 05:43:27,150
Before I explain the issue, let me give you a brief overview of the IHSS program and the drivers of cost and sources of revenue that support it.

3575
05:43:27,950 --> 05:43:36,530
As you know, IHSS is a program that allows disabled seniors, adults and children to remain safely in their home thereby avoiding more costly out of home care.

3576
05:43:37,570 --> 05:43:42,490
Recipients of these caregiver services are medical eligible and must have certification

3577
05:43:42,490 --> 05:43:45,150
if they need assistance with daily activities of living.

3578
05:43:47,700 --> 05:43:52,020
The two main drivers of cost in the program are consumer need and provider payments.

3579
05:43:52,840 --> 05:43:57,980
Need is defined as the number of consumers that are eligible and the service hours they're authorized to receive.

3580
05:43:58,820 --> 05:44:02,160
IHSS providers are paid an hourly wage to provide these services.

3581
05:44:04,750 --> 05:44:06,390
I'm not touching it. What happened?

3582
05:44:06,390 --> 05:44:08,770
I think just go back if you can.

3583
05:44:09,350 --> 05:44:09,910
It's

3584
05:44:12,470 --> 05:44:13,410
got a mind of its own.

3585
05:44:14,090 --> 05:44:14,290
Yeah,

3586
05:44:17,420 --> 05:44:18,620
that's your slides.

3587
05:44:21,440 --> 05:44:22,500
Okay, here we go.

3588
05:44:24,260 --> 05:44:25,440
We call that a preview.

3589
05:44:25,860 --> 05:44:27,520
Yeah, thank you.

3590
05:44:28,760 --> 05:44:28,940
Okay.

3591
05:44:29,980 --> 05:44:33,560
IHSS providers are paid an hourly wage to provide these authorized services.

3592
05:44:33,920 --> 05:44:36,420
They're also eligible for benefits over time and sick leave.

3593
05:44:37,280 --> 05:44:40,740
IHSS entitlement cost, as well as our cost to administer the program.

3594
05:44:40,740 --> 05:44:43,780
are shared by the federal, state, and county government.

3595
05:44:45,160 --> 05:44:51,300
With the governor's proposed budget, the non-federal portion of these costs would shift significantly to counties.

3596
05:44:51,900 --> 05:44:58,300
To understand the shifts, let me briefly describe the coordinated care initiative or CCI, and the new cost sharing rules that came with it.

3597
05:44:59,080 --> 05:44:59,980
CCI is a joint-

3598
05:45:00,000 --> 05:45:04,460
Senate State and federal demonstration project that was implemented in fiscal year 2012-13.

3599
05:45:05,060 --> 05:45:07,960
To date, seven counties have participated in CCI.

3600
05:45:08,620 --> 05:45:11,660
Collective bargaining for those counties was shifted to the state.

3601
05:45:12,140 --> 05:45:14,740
We are not one of the seven participating counties.

3602
05:45:15,740 --> 05:45:17,280
The goal of the pilot was twofold.

3603
05:45:18,000 --> 05:45:23,360
One, achieve better outcomes for seniors and persons with disabilities who are eligible for both medical and

3604
05:45:23,360 --> 05:45:29,580
Medicare by improving the coordination of their health and long-term care services through a single health plan.

3605
05:45:29,580 --> 05:45:32,980
The second goal was to generate savings for the state.

3606
05:45:33,660 --> 05:45:42,400
When CCI was implemented, the state also established a new IHSS MOU funding formula which changed cost sharing between the state and all counties.

3607
05:45:43,460 --> 05:45:52,960
Each county's base MOU was set at IHSS actual expenditures for fiscal year 1112 with a required annual increase of 3.5%.

3608
05:45:53,500 --> 05:46:03,840
As a result of this formula, counties share of costs has grown modestly and predictably over the last five years, as the state has taken on a relatively larger proportion of the program's rising cost.

3609
05:46:04,660 --> 05:46:10,340
By statute, the state is required on an annual basis to determine if the CCI pilot is cost effective.

3610
05:46:11,080 --> 05:46:15,220
Last month, the director of finance announced that the CCI is not cost effective.

3611
05:46:15,220 --> 05:46:22,580
And in accordance with state law, this determination means that effective July 2017, the IHSS

3612
05:46:22,580 --> 05:46:23,960
MOE will be discontinued.

3613
05:46:24,660 --> 05:46:30,240
As a result in barring any subsequent change to state law, the county MOE formula will

3614
05:46:30,240 --> 05:46:36,660
be rescinded and counties will go back to the 35% sharing ratio of non-federal IHSS cost

3615
05:46:37,260 --> 05:46:38,740
before the MOE was established.

3616
05:46:39,640 --> 05:46:44,660
The county cost will be affected by a range of factors that drive cost, including anticipated

3617
05:46:44,660 --> 05:46:49,320
a growth in enrollment, the gradual increase of the state's minimum wage, and

3618
05:46:49,320 --> 05:46:52,040
this current state rate cap of $12.10.

3619
05:46:54,450 --> 05:47:00,130
For counties in 1991, realignment is the dedicated revenue source that we rely on to pay for our share of cost.

3620
05:47:00,910 --> 05:47:06,250
It's a complicated structure, but suffice it to say that this primarily sales and

3621
05:47:06,250 --> 05:47:14,030
VLF tax-based revenue stream, even in a period of economic growth, simply cannot support the magnitude of cost shifts.

3622
05:47:14,030 --> 05:47:19,190
and future caseload increases and wage growth associated with IHSS.

3623
05:47:19,710 --> 05:47:30,310
In fiscal year 1718 alone, the statewide impact counties is projected at $624 million with a potential hit of up to $3 million in Santa Cruz County.

3624
05:47:30,770 --> 05:47:37,570
By fiscal year 2223, additional IHSS costs for our county balloon to $18 million.

3625
05:47:38,210 --> 05:47:42,250
If we were to experience a recession, these numbers become more grim.

3626
05:47:42,250 --> 05:47:54,170
It's important to note that with the elimination of the MOE, the governor assumes that counties pick up five years worth of prior caseload growth increases all in fiscal year 17-18.

3627
05:47:55,370 --> 05:48:06,390
Under 1991 realignment, counties are paid in their rears for increased costs, so we would not expect to see even partial reimbursement for these costs until fiscal year 18-19.

3628
05:48:06,850 --> 05:48:09,390
That's creating a major cash flow problem.

3629
05:48:09,390 --> 05:48:20,650
The governor's proposal also assumes that counties pick up 100% of a non-federal share for any wage and benefit levels in excess of the current state cap.

3630
05:48:21,210 --> 05:48:32,310
Once the state minimum wage exceeds Santa Cruz County's current wage rate of $11.90, we'll flip the bill for all non-federal cost up to $15.

3631
05:48:32,310 --> 05:48:33,590
This

3632
05:48:37,750 --> 05:48:40,070
chart shows the potential impacts to our county.

3633
05:48:40,590 --> 05:48:45,450
The brown bar shows the additional cost we must pay above our current MOE.

3634
05:48:46,750 --> 05:48:52,690
The cost increases above the yellow line are driven exclusively by minimum wage increases.

3635
05:48:53,630 --> 05:48:58,490
And the blue levels represent our share of cost if the MOE were maintained.

3636
05:49:01,480 --> 05:49:05,380
Future costs will also continue to accelerate due to demographics.

3637
05:49:05,380 --> 05:49:11,300
As baby boomers age, a number of IHSS eligible adults will climb.

3638
05:49:12,120 --> 05:49:18,160
The shortfall of 1991 realignment funds will also have serious impacts on other county programs.

3639
05:49:19,160 --> 05:49:24,980
Since the first draw on 1991 sales tax revenue goes to paying for caseload growth,

3640
05:49:25,620 --> 05:49:33,300
these projected IHSS cost increases will strip funds that currently flow to the health and mental health subaccounts.

3641
05:49:34,000 --> 05:49:40,040
In turn, this directly impacts programs provided by the Health Services Agency as well as all

3642
05:49:40,040 --> 05:49:42,420
county departments who rely heavily on general fund.

3643
05:49:45,190 --> 05:49:49,710
With regard to impacts on IHSS consumers, the elimination of the MOE will not change

3644
05:49:49,710 --> 05:49:52,590
the way we determine eligibility or authorized service hours.

3645
05:49:53,230 --> 05:49:59,790
However, in 2020, we anticipated 7% reduction in authorized hours due to the sunsetting

3646
05:49:59,790 --> 05:50:03,670
of a tax that helped restore these hours in 1516.

3647
05:50:03,670 --> 05:50:12,210
Since we are not a CCI pilot county, collective bargaining for our IHSS provider wages and benefits will continue to happen at the county level.

3648
05:50:13,010 --> 05:50:17,690
Finally, we anticipate funding shortages could impact staffing levels and work load.

3649
05:50:18,930 --> 05:50:29,790
Earlier today your board approved sending letters to the governor and various legislative leaders and budget committees expressing your opposition to dismantling the CCI and eliminating the IHSSMOA.

3650
05:50:29,790 --> 05:50:37,770
Similar letters have been sent by CSAC, along with the California Welfare Directors Association, and County Behavioral Health Directors Association.

3651
05:50:38,600 --> 05:50:48,230
This proposal in its current form is untenable, and as such, HSD's proposed 1718 budget does not address the elimination of the IHS MOA.

3652
05:50:48,690 --> 05:50:53,850
We have included our maintenance of effort plus a 3.5% increase only.

3653
05:50:53,850 --> 05:51:16,770
Secondly, as further information unfolds on short and long-term strategies to mitigate financial hardship to counties and to address structural revenue deficiencies associated with 1991 realignment, we'll return to your board with a supplemental budget and or potentially a mid-year budget modification after the governor's final state budget is signed, and that concludes my remarks.

3654
05:51:17,590 --> 05:51:25,110
Thank you. Are there questions? This may be a question more for Susan than the new which

3655
05:51:25,790 --> 05:51:30,290
is a lot of this, we're dealing with a lot of uncertainty at the federal and state level.

3656
05:51:31,010 --> 05:51:34,830
Are we really going to have to wait for the state budget to figure out what's going to

3657
05:51:34,830 --> 05:51:40,530
have with the IHSS or do you expect that there'll be an agreement sooner or some indication

3658
05:51:40,530 --> 05:51:41,090
sooner?

3659
05:51:41,450 --> 05:51:44,650
I'd like to defer that to Carlos. I think he's got that information.

3660
05:51:48,260 --> 05:51:49,440
We don't really know.

3661
05:51:50,060 --> 05:51:50,320
Okay.

3662
05:51:51,040 --> 05:51:53,180
I think there's a lot of uncertainty still.

3663
05:51:53,980 --> 05:51:57,380
We think though that we will know by the time we have a supplemental.

3664
05:51:58,080 --> 05:51:58,900
And so that's our hope.

3665
05:51:59,360 --> 05:52:02,200
So that we think in the mid-year when the governor does his update,

3666
05:52:02,200 --> 05:52:05,360
May 12th typically, that we'll have a more firm answer.

3667
05:52:05,620 --> 05:52:08,740
And that allows us to do it through a budget supplemental budget adjustment.

3668
05:52:09,440 --> 05:52:11,480
Worst case scenario is we have to do a mid-year.

3669
05:52:11,480 --> 05:52:17,560
And then in terms of cow works, we did see in the earlier presentation that our unemployment

3670
05:52:17,560 --> 05:52:19,800
rate is going down.

3671
05:52:20,860 --> 05:52:27,880
So in terms of the impact on people, are we seeing that relative drop in our caseload

3672
05:52:27,880 --> 05:52:29,060
that they're anticipating or?

3673
05:52:30,140 --> 05:52:36,440
We are seeing a decrease in our caseload by about 15% over the last two to three years.

3674
05:52:36,440 --> 05:52:42,220
I think the challenge for us is even though the caseloads have decreased, this particular

3675
05:52:42,220 --> 05:52:47,400
program serves individuals in a community that has an incredibly high cost of living

3676
05:52:47,780 --> 05:52:53,920
with poverty rates higher than the state average, both for families and especially for children.

3677
05:52:54,640 --> 05:52:58,780
And we also, with our CalWORPS population and those that participate in welfare to work,

3678
05:52:58,780 --> 05:53:06,220
have tremendous barriers and significant issues that we face on a daily basis in trying

3679
05:53:06,220 --> 05:53:06,960
to support them.

3680
05:53:07,080 --> 05:53:15,480
For instance, 60% of our welfare to work participants acknowledge having mental health issues close

3681
05:53:15,480 --> 05:53:21,540
to 50% domestic violence issues with a quarter of the welfare to work population experiencing

3682
05:53:21,540 --> 05:53:23,940
some form of substance use disorder.

3683
05:53:23,940 --> 05:53:46,360
So part of our challenge with these decreasing allocations is that, in a community that is the type of poverty here that we have in the high cost of living, as well as the challenges of some of our welfare to work population, those allocation reductions don't really reflect the type of service support that is needed to help welfare to work in cowards participants succeed.

3684
05:53:50,520 --> 05:54:00,380
I think the bleak I'll look that was presented is correct, although I had last week's board meeting of the CESAC,

3685
05:54:00,700 --> 05:54:06,300
the California State Association of Counties, this is the biggest issue on their plate 624 million statewide.

3686
05:54:06,560 --> 05:54:15,160
They did say Matt Kate, the executive officer of CESAC, did say that they've had continual meetings with

3687
05:54:15,160 --> 05:54:22,060
governor Brown faced face and it was almost like, wow, he knew what was going on of course,

3688
05:54:22,260 --> 05:54:24,740
but he didn't know it was going to be the significant of an impact.

3689
05:54:25,200 --> 05:54:33,600
It was kind of a positive response, but nothing like it's going to just reverse it and have

3690
05:54:33,600 --> 05:54:35,580
the state take on $625 million.

3691
05:54:36,280 --> 05:54:44,120
But it was a little uplifting of the bad news by the end of last week at least, that he's

3692
05:54:44,120 --> 05:54:45,900
in conversation with them about it, at least.

3693
05:54:47,160 --> 05:54:47,400
All right.

3694
05:54:49,880 --> 05:54:54,040
Correct my calculation here on, you know, the mathematics.

3695
05:54:54,860 --> 05:54:59,260
But we would pick up the whole $3 million extra cost.

3696
05:54:59,960 --> 05:55:01,880
Up to $3 million, we would pick that up.

3697
05:55:01,980 --> 05:55:04,360
Right, in addition to the $6 million, all right.

3698
05:55:05,660 --> 05:55:07,140
Okay, do we have that money?

3699
05:55:07,460 --> 05:55:08,060
We don't have it.

3700
05:55:08,760 --> 05:55:10,820
I mean, we don't have that money.

3701
05:55:11,040 --> 05:55:11,920
We don't have the money.

3702
05:55:11,920 --> 05:55:22,440
So the state raises the threshold, they're going to get money because they get state taxes out of, you know, somebody's payroll check.

3703
05:55:23,140 --> 05:55:28,360
So they're going to keep all the money but shift the whole responsibility to us.

3704
05:55:28,660 --> 05:55:30,740
It's not logical, it's not fair.

3705
05:55:32,420 --> 05:55:35,200
Anyway, is that what it looks like is happening?

3706
05:55:35,200 --> 05:55:59,160
Well, I think what's happening is that it's a convergence of a lot of unfortunate things all in one and one of the things that's happened is over time, the 1991 re-alignment source that was intended to support this IHSS program has been changed and modified, it is no longer the sales tax revenue, no longer supports.

3707
05:55:59,160 --> 05:56:03,980
many of the changes in the policy changes of the state level.

3708
05:56:04,100 --> 05:56:04,940
Let me give you two examples.

3709
05:56:06,000 --> 05:56:08,360
When we established the MOE in 2012,

3710
05:56:08,360 --> 05:56:12,000
that was prior to the state establishing a minimum wage law

3711
05:56:12,000 --> 05:56:16,500
that gradually increased wages up to $15 in 2022.

3712
05:56:17,520 --> 05:56:20,300
And the counties were not a part of that process.

3713
05:56:20,300 --> 05:56:25,580
However, when the wages go up and the MOE is eliminated,

3714
05:56:25,580 --> 05:56:34,920
We now hold 35% of those wage increases that we don't have the revenue to support through 1991.

3715
05:56:35,860 --> 05:56:45,220
Add on to that, other issues like the fact that the state is not making any statements about changing the wage cap at 1210.

3716
05:56:46,000 --> 05:56:54,820
When that happens, it creates an unbearable burden on counties to absorb all the non-federal share of cost.

3717
05:56:54,820 --> 05:56:59,800
if the state continues to keep its wage cap at $12.10, even though the wages keep going up.

3718
05:57:00,040 --> 05:57:03,640
We would be taking the whole burden without any benefit.

3719
05:57:04,660 --> 05:57:05,400
Without any revenue.

3720
05:57:05,600 --> 05:57:07,820
Without the revenue, which would be the benefit.

3721
05:57:09,780 --> 05:57:11,620
IHS has already underpaid.

3722
05:57:12,120 --> 05:57:13,600
I mean, they should get more, really.

3723
05:57:15,100 --> 05:57:16,740
I don't know what we're going to do.

3724
05:57:16,860 --> 05:57:19,500
We did face this about three, four years ago, right?

3725
05:57:19,660 --> 05:57:20,480
Same kind of thing.

3726
05:57:20,480 --> 05:57:27,460
I think the state did finally come through and help out, but we'll see who blinks first, sir.

3727
05:57:29,160 --> 05:57:31,100
Well, I think they have control of the blinking.

3728
05:57:31,520 --> 05:57:34,180
It's only a question of what's going to happen to us.

3729
05:57:35,400 --> 05:57:41,900
You know, the three or four years ago when we dealt with this, it was because the state was trying to not do their share.

3730
05:57:41,900 --> 05:57:51,600
and so we could aim our anger and the anger of the IHS recipients and caregivers to

3731
05:57:51,600 --> 05:57:55,220
the state for in order for them to do it and they came through, right?

3732
05:57:56,280 --> 05:57:59,560
Now the state is trying to get out of the business and put it all on us.

3733
05:58:00,200 --> 05:58:08,280
They've raised the wage rates but they're not going to stick around to actually pay the

3734
05:58:08,280 --> 05:58:09,020
increase wages.

3735
05:58:09,020 --> 05:58:14,520
So that's the policy inconsistency at the very least.

3736
05:58:16,520 --> 05:58:23,320
One of the things that you didn't cover in this, but I'm wondering what's going on.

3737
05:58:24,840 --> 05:58:35,400
Two weeks ago, it's two weeks ago now, we had this raid here in Santa Cruz, in Santa Cruz and Live Oak.

3738
05:58:35,400 --> 05:58:43,280
And what have we seen in terms of people seeking assistance as a result of those rates?

3739
05:58:45,750 --> 05:58:52,010
Our staff have been attending every community event that we can participate in to attempt

3740
05:58:52,010 --> 05:58:59,030
to provide accurate information to the community about public assistance and their access to

3741
05:58:59,030 --> 05:59:01,310
public assistance and what that looks like right now.

3742
05:59:01,310 --> 05:59:29,770
But I have to say that all the activities that are going on have absolutely led to individuals who currently are receiving some form of public assistance to be rethinking that on anecdotally, we are actually tracking trying to track this across multiple programs right now, but anecdotally on a daily basis, we have staff reporting to our managers that individuals are calling and saying, how do I get all of every program I'm on?

3743
05:59:29,770 --> 05:59:35,050
So, we're absolutely concerned about this because right now nothing has changed in a law,

3744
05:59:35,770 --> 05:59:42,470
but I think that some of the actions that are taking place with respect to ICE and other

3745
05:59:42,470 --> 05:59:49,550
executive orders and draft orders are having an effect of creating a lot of anxiety and the

3746
05:59:49,550 --> 05:59:54,290
community about what it means to be enrolled in anything, even if a law hasn't yet changed.

3747
05:59:54,290 --> 05:59:59,970
And do you see a need, and maybe it's a question for your colleague?

3748
06:00:00,000 --> 06:00:28,740
The colleague as well about providing resources to do the outreach necessary to help bring people back in because it's fear that's driving us. Not facts. And, you know, should we be, should we be thinking about doing some outreach? Because, you know, the people not getting their SNAP benefits as a direct, there's a direct hit on the health of our community.

3749
06:00:30,300 --> 06:00:43,840
Well, I agree with you that we should be doing everything possible to outreach and give people facts about what it means currently to be on benefits and to give them accurate information and we're doing that now.

3750
06:00:44,380 --> 06:00:55,420
We were at the Watsonville High School over the weekend and with people from our staff doing just that thing trying to enroll people on the spot,

3751
06:00:55,420 --> 06:01:03,100
give them accurate information, and unfortunately, and sadly, we got a report on Monday yesterday

3752
06:01:03,100 --> 06:01:04,340
that we had no takers.

3753
06:01:04,620 --> 06:01:09,580
Even with all the accuracy of the information and being out there, people are genuinely

3754
06:01:09,580 --> 06:01:10,120
afraid.

3755
06:01:10,820 --> 06:01:15,580
So any ideas and any different strategies we were just participating in South County lunch

3756
06:01:15,580 --> 06:01:22,840
today with a coordinated meeting across providers, school districts and the like, and we are looking

3757
06:01:22,840 --> 06:01:29,040
to possibly put together or be a part of putting together a day-long event in North and South County

3758
06:01:29,500 --> 06:01:36,660
to try to educate the community more deeply on some of these issues. So we will be at every event

3759
06:01:36,660 --> 06:01:42,300
and do everything possible to educate our community about public assistance and their right and their

3760
06:01:42,300 --> 06:01:48,320
access to those benefits right now and also to try to inform and address some of the understandable

3761
06:01:48,320 --> 06:01:49,760
more anxiety than it could exist?

3762
06:01:50,440 --> 06:02:00,000
Yeah, I do want to express my thanks to both you and your staff and Emily for being at

3763
06:02:00,000 --> 06:02:07,200
the forum in Live Oak because I think it was very helpful for the community just a couple

3764
06:02:07,200 --> 06:02:14,080
of days after this event to see county staff interested and wanted to help out.

3765
06:02:14,520 --> 06:02:17,460
So I appreciate that I imagine we'll be doing more of that in Live Oak.

3766
06:02:17,460 --> 06:02:18,280
So thank you.

3767
06:02:18,540 --> 06:02:19,140
Thank you.

3768
06:02:19,500 --> 06:02:20,600
You have last thing.

3769
06:02:21,060 --> 06:02:25,720
I don't want to bring it up now for discussion because it doesn't quite fit, but the community

3770
06:02:25,720 --> 06:02:29,780
programs does review, comes under human services.

3771
06:02:30,300 --> 06:02:34,520
So I do have concerns about that and we'll talk about them at a later date.

3772
06:02:35,460 --> 06:02:40,140
We have a letter coming to your board on March 14th that will give an update on the core

3773
06:02:40,140 --> 06:02:40,980
investments process.

3774
06:02:40,980 --> 06:02:44,280
I welcome any of your questions or concerns.

3775
06:02:44,280 --> 06:02:48,400
I don't want to see some programs lift up, but thank you.

3776
06:02:49,760 --> 06:02:54,540
Okay, not seeing any more questions from the Board, I'll ask Ms. DeWin.

3777
06:02:55,980 --> 06:02:59,860
Yes, good afternoon, Chairman Leopold and other members of the Board.

3778
06:03:00,820 --> 06:03:02,860
Jane Goen from the County Health Services Agency.

3779
06:03:03,080 --> 06:03:13,760
Before I begin my briefing this afternoon to your Board regarding major emerging issues pertaining to the health service arena, on behalf of the agency, I would like to thank you.

3780
06:03:13,760 --> 06:03:21,620
your board for this morning acknowledging and expressing condolences of our very last Mr.

3781
06:03:21,780 --> 06:03:27,840
Dr. Bill Manoff and it was very difficult for our department in the last few days.

3782
06:03:28,560 --> 06:03:34,800
Your caring is very much appreciated and our thoughts are with Bill's family and his

3783
06:03:34,800 --> 06:03:35,140
friends.

3784
06:03:35,540 --> 06:03:36,700
So thank you very much for that.

3785
06:03:36,700 --> 06:03:42,260
So, this afternoon, following the informative presentation from our Assistant C.A.O.

3786
06:03:42,440 --> 06:03:48,340
auditor controllers and my colleagues from other county departments on the behalf of HSA,

3787
06:03:48,560 --> 06:03:55,840
I'm here to inform advice board of six major emergent issues that have far reaching potential

3788
06:03:55,840 --> 06:03:57,600
impact at our local level.

3789
06:03:58,620 --> 06:04:02,800
I would try not to repeat the information which you already heard from other departments,

3790
06:04:02,800 --> 06:04:19,220
including the domino impact from the IHS-shifting cost-sharing arrangement between the state and counties because it does also impact on the health and public health and mental health realignment funds from 1991 funds.

3791
06:04:19,780 --> 06:04:21,420
So I will not repeat that information.

3792
06:04:21,420 --> 06:04:28,900
So, the sixth major emerging issue that I would like to take about 10 to 12 minutes to go

3793
06:04:28,900 --> 06:04:34,620
over this afternoon are the uncertainty of the future of the Affordable Care Act.

3794
06:04:34,980 --> 06:04:36,440
How can we not talk about that?

3795
06:04:36,620 --> 06:04:41,420
It's at everybody's dinner table, discussion now a day, and it's on TV everywhere.

3796
06:04:42,200 --> 06:04:47,500
And I want to talk about the second issue of very important as well is the potential change

3797
06:04:47,500 --> 06:04:55,380
to the Medicaid structure and funding to states, and the third one is the actual loss of funding

3798
06:04:55,380 --> 06:04:59,420
and anticipated further funding loss of our county mental health program.

3799
06:05:00,420 --> 06:05:05,280
Fourth, the plan to recommend moving forward with launching drug medical expansion

3800
06:05:05,280 --> 06:05:09,400
for our county, despite all these uncertainties, and I will explain that further.

3801
06:05:10,700 --> 06:05:16,860
Fifth, we would like to briefly mention about the community interest in adopting law's law.

3802
06:05:16,860 --> 06:05:23,040
or fighting appropriate alternative models to assist at risk individuals.

3803
06:05:23,520 --> 06:05:27,560
There are not engaging in behavioral health and other necessary services.

3804
06:05:27,800 --> 06:05:34,720
We'd like to mention that this afternoon, and we'll bring it to your board during budget hearing as well in details about this item.

3805
06:05:35,380 --> 06:05:42,380
Last but not least, we would like to brief your board about the anticipated primary care funding cliff for

3806
06:05:42,380 --> 06:05:44,340
or all community health centers nationwide.

3807
06:05:44,740 --> 06:05:46,520
There is funding loss associate to that.

3808
06:05:47,460 --> 06:05:50,800
So now I will brief your board with the first emerging issue,

3809
06:05:50,920 --> 06:05:54,060
which is the potential review of the Affordable Care Act

3810
06:05:54,520 --> 06:05:56,820
and a known replacement plan.

3811
06:05:57,800 --> 06:05:58,920
So as your board know,

3812
06:05:59,380 --> 06:06:01,960
briefly for general public reminder,

3813
06:06:02,280 --> 06:06:05,280
the ACA became law in March 2010.

3814
06:06:05,940 --> 06:06:09,060
It makes substantial changes to how healthcare services

3815
06:06:09,060 --> 06:06:11,860
and health insurance coverage are provided nationwide.

3816
06:06:12,480 --> 06:06:15,000
The major provisions of the ACA include

3817
06:06:15,000 --> 06:06:17,340
number one insurance market changes,

3818
06:06:18,060 --> 06:06:20,780
number two subsidized coverage for qualifying individual

3819
06:06:20,780 --> 06:06:23,500
through federal and state health benefit changes,

3820
06:06:24,220 --> 06:06:26,560
number three federal funding for an expansion

3821
06:06:26,560 --> 06:06:29,780
of program eligibility in state Medicaid programs

3822
06:06:29,780 --> 06:06:31,860
in California we call it MediCal.

3823
06:06:32,480 --> 06:06:35,400
Number four additional federal participation,

3824
06:06:35,400 --> 06:06:40,760
financial participation on other healthcare programs, and services, and

3825
06:06:40,760 --> 06:06:44,860
number five, new federal revenues coming to states and locals.

3826
06:06:46,240 --> 06:06:55,000
Vienna Progressive State, California took full advantage of the opportunities to expand and implement the ACA.

3827
06:06:55,440 --> 06:06:59,120
Now, almost seven years later, after the law was enacted.

3828
06:06:59,720 --> 06:07:05,000
California's healthcare landscape looked very different from 2013.

3829
06:07:05,000 --> 06:07:17,060
with the full implementation of ACA, and you heard from Ms. Timberlake earlier the remarkable success in the number of Medi-Cal and Cover California enrollee, so I will not repeat that information.

3830
06:07:18,020 --> 06:07:29,320
So the impact if this were to be repealed without knowing all the details, what part of it or how it's going to be replaced, if you could imagine if any of this would be repealed,

3831
06:07:29,320 --> 06:07:38,880
We are looking at an increase, again, in our uninsured population, which is very sad and very unfortunate if that were to happen.

3832
06:07:39,480 --> 06:07:47,040
According to the UC Berkeley Center for Labor Research and Education and UC LA Center for Health Policy Research,

3833
06:07:47,460 --> 06:07:55,660
Santa Cruz County ranked second highest in the state of California in reducing its uninsured rate by 67%.

3834
06:07:55,660 --> 06:08:03,900
We are right behind Solano and Stan Lewis, Stanislaus County, there are 68% with 67%.

3835
06:08:04,540 --> 06:08:09,600
So who stands to lose if the ACA is repealed with a known replacement plan?

3836
06:08:10,660 --> 06:08:25,640
It's very sad to say that lots of people, the poor, the low income, the working class people, the young and the old, those who have pre-existing medical conditions, those who have benefited from the ACA requiring all health insurance companies to ensure the tax.

3837
06:08:25,640 --> 06:08:30,080
10 essential health benefits in their coverage, and also the parity in

3838
06:08:30,080 --> 06:08:34,000
payment and benefit coverage for health and behavioral health conditions.

3839
06:08:34,680 --> 06:08:38,480
Not to mention the threat of federal funding loss for prevention and

3840
06:08:38,480 --> 06:08:42,540
public health funds that would impact the entire population of the nation.

3841
06:08:43,980 --> 06:08:48,040
Financial speaking, California would lose approximately $18 billion

3842
06:08:48,660 --> 06:08:53,700
alone for leveraging the cost of Medicaid expansion population,

3843
06:08:53,700 --> 06:09:02,440
for Santa Cruz, the economic impact would be approximately $86 million annually for HSA and

3844
06:09:02,440 --> 06:09:03,780
then zoom it down to HSA.

3845
06:09:04,340 --> 06:09:10,500
We projected approximately $12 million annual loss of federal funding alone just on the

3846
06:09:10,500 --> 06:09:11,400
Medicaid expansion.

3847
06:09:11,400 --> 06:09:18,140
I'm not talking about other public health prevention funding or the ACA related to the

3848
06:09:19,000 --> 06:09:21,120
cliffs that I'm going to be talking about next.

3849
06:09:21,120 --> 06:09:28,480
So with that, as you know, the dominant impact would be we would have to think about how to

3850
06:09:28,480 --> 06:09:32,340
how to provide some type of health coverages for an insure population.

3851
06:09:32,860 --> 06:09:37,360
We would lose all the good care coordination that have been going on across providers throughout

3852
06:09:37,360 --> 06:09:38,880
county in the last six years.

3853
06:09:38,880 --> 06:09:42,960
There has been great efforts of all providers trying to provide care coordination.

3854
06:09:42,960 --> 06:09:44,980
It would be really greatly disrupted.

3855
06:09:45,500 --> 06:09:50,240
And that of course prevention, early intervention, coordination and innovative care would be

3856
06:09:50,240 --> 06:09:51,320
dissensifies.

3857
06:09:54,190 --> 06:10:00,050
So right now in our plan to put in our recommended budget for next fiscal year,

3858
06:10:00,250 --> 06:10:07,030
we have not included any of this impact because the details are unknown. We want to make sure that we

3859
06:10:07,030 --> 06:10:13,610
remain vigilant, watching out what's going on at the federal and state level. We want to maintain

3860
06:10:13,610 --> 06:10:21,450
prudent, we want to be sure that we are prudent in our funding in our budget and to prepare for any

3861
06:10:21,450 --> 06:10:29,270
changes at the federal level and we want to make sure that we re-evaluate the relationship

3862
06:10:29,270 --> 06:10:34,470
we have with the state regarding the financial relationship, financing relationship with

3863
06:10:34,470 --> 06:10:42,970
the state as you recall. In 2014, the state recouped about $3.8 million from our county help

3864
06:10:42,970 --> 06:10:48,950
re-alignment funds in anticipation of the reduction of the in and show of population, so we really

3865
06:10:48,950 --> 06:10:57,790
lost that funding every year. So we need to rethink how we could work with the state to figure out the next financing relationship with the state would be.

3866
06:10:59,290 --> 06:11:13,250
And Ms. Timberlake say we have to watch for the elimination of SB 85, which was the last in for the state to provide full scope medical coverage for uninsured undocumented kids.

3867
06:11:13,250 --> 06:11:16,930
if they are going to do the last in-first out,

3868
06:11:17,170 --> 06:11:19,310
that would be the first program would be impacted.

3869
06:11:20,370 --> 06:11:22,390
And of course, we want to continue to work closely

3870
06:11:22,390 --> 06:11:24,530
with our community partners for any approach

3871
06:11:24,530 --> 06:11:27,050
to mitigate any of these cuts.

3872
06:11:28,730 --> 06:11:33,050
So the second issue emerging that has also been known

3873
06:11:33,570 --> 06:11:37,570
across the nation is the plan to restructure

3874
06:11:38,210 --> 06:11:40,850
the Medicaid funding for states.

3875
06:11:40,850 --> 06:11:49,210
So, there are talks about the federal government want to change the Medicaid to either a block

3876
06:11:49,210 --> 06:11:52,290
grant program or put capital allocated program.

3877
06:11:52,950 --> 06:12:00,950
Either those would have potential negative impact and a lot to be thinking about because

3878
06:12:00,950 --> 06:12:08,110
with those changes, the state would be asked to manage with an amount of money like the

3879
06:12:08,110 --> 06:12:12,590
block grants, we would get a fixed amount of dollars from federal for Medicaid program

3880
06:12:12,590 --> 06:12:17,210
and it's up to the state and the local level to manage the population, whether there's

3881
06:12:17,210 --> 06:12:22,610
a case look, growth, there's medical acuity level increases, et cetera, so we are at risk.

3882
06:12:23,210 --> 06:12:29,170
The pro-capital grant, the pro-capital allocation also would be a problem because we again would

3883
06:12:29,170 --> 06:12:36,130
have to look at how the state, the federal would look at the historical expenditure, what

3884
06:12:36,130 --> 06:12:40,390
year, they're going to base that on for base year, baseline year, and what kind of growth

3885
06:12:40,390 --> 06:12:46,290
they're going to give us, and also what kind of flexibility the Fed would give the state

3886
06:12:46,290 --> 06:12:48,350
in order to manage and control the costs.

3887
06:12:48,970 --> 06:12:55,530
So state might be thinking about ways to change eligibility criteria, medical necessity,

3888
06:12:55,970 --> 06:13:03,190
criteria, or any type of services that could control costs, and that raise the concern as

3889
06:13:03,190 --> 06:13:06,930
the rest of the nurse as the health director of Al County, I'm very concerned about any of

3890
06:13:06,930 --> 06:13:17,290
those changes. Next, the third important emerging issue that actually already happening to Al

3891
06:13:17,290 --> 06:13:22,810
County is right after you've already adopted the budget for HSA for this current fiscal year

3892
06:13:22,810 --> 06:13:30,530
in June. A few months later this date turned around and cut out realignment funding by $2 million.

3893
06:13:30,530 --> 06:13:42,330
So it's already impacting this fiscal year, and that has changed our base funding for 2011 realignment pot for Santa Cruz County behavior help.

3894
06:13:42,910 --> 06:13:51,170
So we have done our best to observe that cost, but moving forward, that is the permanent cut every year to our county.

3895
06:13:51,170 --> 06:14:12,110
And also starting next fiscal year, we anticipate losing approximately $1 million annually for the next 20 years from the Proposition 63 MHSA funds due to the state placing debt servicing obligation on counties for the $2 billion statewide initiative condo place like home housing bond.

3896
06:14:12,110 --> 06:14:18,030
This is an exciting opportunity, however, at already a loss to our county in terms of our base funding.

3897
06:14:18,990 --> 06:14:24,230
And we're hoping that we can continue working with the state to figure out a way to leverage

3898
06:14:24,230 --> 06:14:30,610
the no place like home to support our community and no opportunity to recoup the funding.

3899
06:14:32,740 --> 06:14:38,820
So because of that, we are faced with very tough decisions to make to bring to your board.

3900
06:14:38,820 --> 06:14:44,780
we need to re-evaluate and reprioritize our service delivery system, including the contracted

3901
06:14:44,780 --> 06:14:51,680
providers that we work with for behavioral services. And we anticipate to make additional

3902
06:14:51,680 --> 06:14:56,520
requests of net county cost to reward during budget hearing, to offset some of the loss

3903
06:14:56,520 --> 06:14:59,980
of revenue for behavior health and for increasing the

3904
06:15:00,000 --> 06:15:01,680
The staffing costs in our operation.

3905
06:15:04,940 --> 06:15:32,440
The next emerging issue is, I see that is an exciting thing, a good thing, is we plan to bring to your board very soon the plan to contract with the state to expand drug-medical services for our community. And I'm not going to bore your board with all these details. You heard about all these unmet needs and what we could do better. So if we were to move forward with this, we could double up the number of individual we serve for very important services, including case management,

3906
06:15:32,440 --> 06:15:37,280
punishment for people who have substance use disorder, and we can leverage further

3907
06:15:37,280 --> 06:15:42,080
federal funding for this. Now, this is a disclaimer on my part. This is pending

3908
06:15:42,080 --> 06:15:47,460
what the Fed might do with federal funding. But I think we should move forward

3909
06:15:47,460 --> 06:15:54,380
with a contract language with the state that we reserve the right to cancel the contract

3910
06:15:55,900 --> 06:15:58,740
if, in fact, we would lose funding from the Fed.

3911
06:15:58,740 --> 06:16:05,330
So the next very important issue as well for our community, you all have heard this.

3912
06:16:05,690 --> 06:16:08,350
A lot of folks have talked to us about Laura's law.

3913
06:16:08,710 --> 06:16:15,890
We know that every community we have individuals who might be at times at risk for themselves and for others.

3914
06:16:16,430 --> 06:16:24,870
And there have been talk about Laura's law because statewide few counties have implemented the program very costly.

3915
06:16:25,550 --> 06:16:30,850
Average cost per person is about $65,000 to $70,000 per person per year.

3916
06:16:31,330 --> 06:16:36,090
We know from talking our staff looking at other counties, looking at our data and

3917
06:16:36,090 --> 06:16:41,210
working with a lot of folks in the community, there are other alternatives that actually

3918
06:16:41,210 --> 06:16:47,750
could provide us better services and cash the net wider in terms of solving this population.

3919
06:16:48,430 --> 06:16:53,270
So behavior health director Eric Rair is not here right now, he's on vacation.

3920
06:16:53,270 --> 06:17:07,230
But he and I plan to present this to your board during budget hearing with options that your board could think about how to support the community with further enhance and expand services to serve this very important population.

3921
06:17:11,240 --> 06:17:17,840
I think this is the last one on my list to advise your board is the primary care funding cliff.

3922
06:17:17,840 --> 06:17:24,780
So, as you know, about 70% of the federal grant funding for community health center nationwide are

3923
06:17:24,780 --> 06:17:30,260
slated to sunset if there's no federal action is taken in my October 2017.

3924
06:17:32,600 --> 06:17:41,920
So, we could lose about $1.2 million in funding for our local county clinics here.

3925
06:17:41,920 --> 06:17:46,940
And, of course, the woman's health center was community health centers, and Salud would

3926
06:17:46,940 --> 06:17:48,480
also be impacted by this.

3927
06:17:49,300 --> 06:17:55,020
So we are working very closely with our national and state association to advocate to make

3928
06:17:55,020 --> 06:18:01,020
sure that they will renew this funding for all community health centers nationwide because

3929
06:18:01,020 --> 06:18:06,440
with that, this type of funding will be very difficult for us to sustain operation and continue

3930
06:18:06,440 --> 06:18:10,400
to provide access to our very media population.

3931
06:18:11,240 --> 06:18:15,420
In our budget, we did not reflect this loss because we're still waiting to see what

3932
06:18:15,420 --> 06:18:16,040
happened next.

3933
06:18:18,390 --> 06:18:22,170
With that, I would like to conclude my presentations and thank you very much for your

3934
06:18:22,170 --> 06:18:22,570
attention.

3935
06:18:22,910 --> 06:18:24,830
And if you have any question, I'd be happy to address.

3936
06:18:24,970 --> 06:18:29,390
And I have very good staff in the audience as well that they could help answer any question

3937
06:18:29,390 --> 06:18:30,550
that I might not know the answer.

3938
06:18:30,990 --> 06:18:31,150
All right.

3939
06:18:31,250 --> 06:18:32,050
We'll try to stump you.

3940
06:18:32,490 --> 06:18:32,890
Thank you.

3941
06:18:33,970 --> 06:18:34,770
Supervisor Capit.

3942
06:18:35,210 --> 06:18:37,410
A quick, I want to thank both of you.

3943
06:18:37,410 --> 06:18:46,310
And you're faced with both very tough decisions and some tough consequences that are going to come up in this year.

3944
06:18:46,850 --> 06:18:49,990
So we'll support you the best we can.

3945
06:18:50,650 --> 06:18:51,070
Thank you.

3946
06:18:55,190 --> 06:18:59,050
I know it all adds up to, but it's not on the plus margin.

3947
06:18:59,610 --> 06:19:00,350
It's unbelievable.

3948
06:19:01,590 --> 06:19:04,810
If all this comes to pass, we're dead broke.

3949
06:19:05,090 --> 06:19:06,970
I think every other county in the state is dead broke.

3950
06:19:08,990 --> 06:19:14,130
I don't know, just have to work our best way out of it and thank you for the efforts

3951
06:19:14,130 --> 06:19:16,550
that you're making and cooperating with others to do it.

3952
06:19:16,730 --> 06:19:23,730
I know that you would and I just hope for the best because we just can't do it.

3953
06:19:23,850 --> 06:19:28,410
This can't be, this is just not acceptable and we've got to do everything we can to not

3954
06:19:28,410 --> 06:19:28,990
let it happen.

3955
06:19:31,050 --> 06:19:31,850
Supervisor Coonerty.

3956
06:19:32,590 --> 06:19:33,410
Yeah, just real briefly.

3957
06:19:33,630 --> 06:19:36,610
I don't have any questions about meeting with both of you pretty regularly.

3958
06:19:36,610 --> 06:19:42,350
talk about this but I think just because I know your teams in the department and maybe watching

3959
06:19:42,350 --> 06:19:49,050
online that I appreciate that you both your departments although faced with these million

3960
06:19:49,050 --> 06:19:54,250
uncertainties and thousands of challenges have also tried to figure out better ways to serve

3961
06:19:54,250 --> 06:20:00,330
those who are most vulnerable and are looking at every approach possible and piecing together

3962
06:20:00,330 --> 06:20:08,470
other dollars and so I work with both you on that and just I think that while the challenges

3963
06:20:08,470 --> 06:20:13,750
are very real, I think I also appreciate your willingness to be flexible to best serve

3964
06:20:14,050 --> 06:20:17,270
the people who are most in need and who be most impacted by these cuts.

3965
06:20:17,590 --> 06:20:23,170
So thanks to both you and your teams for constantly looking at what they want to innovate.

3966
06:20:27,590 --> 06:20:29,910
I'll just had a question or two to ask.

3967
06:20:31,150 --> 06:20:35,290
You talked about the primary care fiscal cliff.

3968
06:20:37,030 --> 06:20:40,770
And you talked about $1.2 million locally.

3969
06:20:41,050 --> 06:20:44,690
Is that just the county's portion or the other clinics?

3970
06:20:45,090 --> 06:20:46,330
Is the county clinics alone?

3971
06:20:46,870 --> 06:20:47,750
Just the county clinics.

3972
06:20:47,750 --> 06:20:49,770
The EQHC grant that we get, the funding that we get.

3973
06:20:49,770 --> 06:20:50,230
Yes.

3974
06:20:50,510 --> 06:20:57,710
So do we have an idea of what the, those other FQHC clinics, you know, the Santa Cruz

3975
06:20:57,710 --> 06:20:59,530
community health centers in Salud?

3976
06:21:00,230 --> 06:21:05,610
I think they about the same amount, a little less depending the volume of when they started.

3977
06:21:07,150 --> 06:21:13,910
This happened before a couple of years ago and under the last president it got renewed.

3978
06:21:14,950 --> 06:21:21,430
And so right now the association on a very concern, they're thinking maybe they could help renew it again,

3979
06:21:21,970 --> 06:21:26,970
but again, we don't know with the new regime that we have right now in Washington, D.C.,

3980
06:21:26,970 --> 06:21:27,970
we're not sure what's going to happen.

3981
06:21:29,050 --> 06:21:35,910
Yeah, well, I've seen the President's doctor so I don't have great faith in his faith in the community health system.

3982
06:21:35,910 --> 06:21:46,370
You talked about the drug Medi-Cal waiver program and funding and the questions we have about that and the benefits that we know will see.

3983
06:21:46,990 --> 06:21:53,370
I know that we're that I think tomorrow we're submitting an application for this whole person care.

3984
06:21:54,190 --> 06:21:59,950
And so how does that figure into the budget request or what's your thought about that?

3985
06:21:59,950 --> 06:22:05,810
Yes, thank you, thank you for mentioning that because I spend the last 72 hours of waking

3986
06:22:05,810 --> 06:22:10,750
moments to write that application and we should be able to submit that very tomorrow.

3987
06:22:11,830 --> 06:22:17,250
So that project is a five-year project that we will be leveraging money from the federal

3988
06:22:17,250 --> 06:22:22,450
to show innovation in connecting data with health and housing.

3989
06:22:23,590 --> 06:22:28,350
And part of that project, we will leverage, we are going to be very innovative and we can

3990
06:22:28,350 --> 06:22:32,970
way to report that to you, Supervisor Coonerty, as well, when you say that, I say,

3991
06:22:33,090 --> 06:22:34,090
God, we got it, we got it.

3992
06:22:35,070 --> 06:22:39,070
We actually going, this idea, the crisis should go to behavioral health,

3993
06:22:39,330 --> 06:22:41,250
hemorrhagic, wirement, and Eric, and staff.

3994
06:22:41,770 --> 06:22:47,150
They want to come up with this idea to serve the seriously mental adults with tablets

3995
06:22:47,710 --> 06:22:50,570
that would be assigned to each of these 60.

3996
06:22:50,930 --> 06:22:56,430
This is, the population is going to be 100 a year, but the 60 folks in that pilot project,

3997
06:22:56,430 --> 06:22:58,490
It's going to be for seriously, not only for folks,

3998
06:22:58,930 --> 06:23:02,170
will masterlies housing that we're going to be working with

3999
06:23:02,170 --> 06:23:04,190
a contractor, to masterlies housing,

4000
06:23:04,270 --> 06:23:06,750
and each of those clients would get a tablet.

4001
06:23:06,970 --> 06:23:09,230
That would help them register their weight,

4002
06:23:09,670 --> 06:23:11,250
their blood sugar, their vital size,

4003
06:23:11,530 --> 06:23:14,270
and basic question like how are you feeling today,

4004
06:23:14,530 --> 06:23:16,390
do you feel suicidal, you take medications,

4005
06:23:16,530 --> 06:23:17,750
what's going on with you.

4006
06:23:18,190 --> 06:23:19,430
So in that data information,

4007
06:23:19,730 --> 06:23:21,870
we fed into our electronic health record system

4008
06:23:21,870 --> 06:23:23,930
so that we can have a live nurse,

4009
06:23:23,930 --> 06:23:29,610
a case manager to monitor those lines on a daily basis to make sure that not only the mental

4010
06:23:29,610 --> 06:23:34,450
health will be improved, but also the physical health, because we know people who have chronic

4011
06:23:34,450 --> 06:23:40,390
and persistent mental illness have a high rate of diabetes, hypertension, COPD, and obesity.

4012
06:23:41,170 --> 06:23:43,090
So that's very innovative in that part.

4013
06:23:43,630 --> 06:23:48,250
To answer your question about drug medical, it's also would be something that we could

4014
06:23:49,270 --> 06:24:08,410
But this application does not allow counties to double-dip, so we have to make sure that whatever is available to Medicaid, whether drug-medical or short-doy, mental health-medical, we cannot apply those to these whole-person care concept services.

4015
06:24:08,910 --> 06:24:16,430
So it have to be very clear delineation of not double-dipping, so we cannot leverage drug-medical for this whole-person care project.

4016
06:24:16,430 --> 06:24:22,410
And can you tell us the timeline as for decision on the whole person care?

4017
06:24:22,610 --> 06:24:30,390
Yes, the state anticipate to get back to county in July sometimes of their somewhat decisions.

4018
06:24:30,850 --> 06:24:33,590
So we should know in July what happened with that.

4019
06:24:33,950 --> 06:24:39,550
So would we be looking at some mid-year budget addition or correction or change?

4020
06:24:40,130 --> 06:24:44,290
Possibly, yes, because if the state approves our application for year one,

4021
06:24:44,290 --> 06:24:49,230
75% of whatever we request and they approve would be loaded to us for first year.

4022
06:24:49,470 --> 06:24:52,090
So first year is a baseline year, they pay us for implementation.

4023
06:24:52,790 --> 06:24:57,690
And then second year, third, fourth, fifth year would be incentive pay for performance kind

4024
06:24:57,690 --> 06:24:57,990
of deal.

4025
06:24:58,130 --> 06:25:01,050
We have to prove that we have outcome in order to pay us.

4026
06:25:01,350 --> 06:25:04,430
Yeah, well that's the first good news that we've gotten this afternoon.

4027
06:25:04,770 --> 06:25:05,290
So thank you.

4028
06:25:06,090 --> 06:25:08,430
I know if we tried hard enough, we'd find some good news.

4029
06:25:08,590 --> 06:25:08,750
Yes.

4030
06:25:08,750 --> 06:25:08,870
Yes.

4031
06:25:09,730 --> 06:25:15,830
Yeah, well, it's clear from just the few departments that we've heard from today that there's

4032
06:25:15,830 --> 06:25:16,690
great need out there.

4033
06:25:17,130 --> 06:25:20,590
And whatever resources we have, we're going to have to make some very difficult choices.

4034
06:25:21,910 --> 06:25:29,190
Knowing about whether people have basic services that those who are most vulnerable is always

4035
06:25:29,190 --> 06:25:32,790
a priority for me, and I think it's been a priority of this board.

4036
06:25:33,150 --> 06:25:36,070
So I appreciate you sharing this information.

4037
06:25:36,070 --> 06:25:41,590
And I'm glad we had this mid-year review to be able to hear what's going on in the programs.

4038
06:25:41,930 --> 06:25:43,950
Thanks, Ufeigh work, and thank you for the work of staff.

4039
06:25:44,130 --> 06:25:44,250
Thank you.

4040
06:25:46,690 --> 06:25:48,830
Okay, Mr. Sunshine's coming back up here.

4041
06:25:55,110 --> 06:26:03,170
I also want to thank our department heads and all our department staff for the hard work they have done in preparing this mid-year report.

4042
06:26:03,370 --> 06:26:10,130
And also in the work they're doing in the budget, we are deep involved in the budget right now and all our CAO and us are also working hard.

4043
06:26:10,130 --> 06:26:13,730
And I wanted to just give you a little bit of a preview.

4044
06:26:15,090 --> 06:26:19,770
General purpose revenues, we still haven't finalized our projections for next year.

4045
06:26:20,530 --> 06:26:24,830
However, if you assume that our revenues continue to grow at the current rate, which they have

4046
06:26:24,830 --> 06:26:28,550
this year and the prior year, they're growing about three to four percent a year.

4047
06:26:30,430 --> 06:26:37,810
And so that is actually good news and that we continue to have moderate but steady revenue

4048
06:26:37,810 --> 06:26:38,330
growth.

4049
06:26:38,330 --> 06:26:44,790
And also, next there would be a milestone in that would be the first year of recovery since our general

4050
06:26:44,790 --> 06:26:49,470
purpose revenues would be exceeding the revenues we had before the Great Recession.

4051
06:26:50,110 --> 06:26:53,610
So we would finally be in recovery, which would be an important milestone.

4052
06:26:53,930 --> 06:26:54,410
10 years.

4053
06:26:54,650 --> 06:27:03,570
We do know that we lost more than $10 million in the last recession that the revenues actually,

4054
06:27:03,570 --> 06:27:10,870
general purpose revenues were very flat for many years and that we've only now hit next year

4055
06:27:10,870 --> 06:27:16,210
would basically be recovering. So that's why we continue to worry about an upcoming recession.

4056
06:27:16,990 --> 06:27:22,890
We know that in regarding expenses for next year, we know some of it. We know our salary and

4057
06:27:22,890 --> 06:27:28,090
benefit increases will total about $7 million. We have other contractual increases of about

4058
06:27:28,090 --> 06:27:33,770
a million. So we know that just in the status quo budget we have about $8 million to absorb

4059
06:27:34,370 --> 06:27:39,050
just to achieve a balanced budget and that doesn't include all these other unknowns.

4060
06:27:39,650 --> 06:27:45,190
And so these risk factors that you're very familiar with and you heard from summarized today

4061
06:27:45,190 --> 06:27:52,230
included a number of issues due to the storm damage and our ongoing deficit and infrastructure

4062
06:27:52,230 --> 06:27:58,050
to make sure spending also the issues that we're just talked about in home supportive services

4063
06:27:58,050 --> 06:28:00,270
and affordable care act as well.

4064
06:28:01,550 --> 06:28:09,310
And so when we look at trying to add those up, we know that it's very hard to determine

4065
06:28:09,310 --> 06:28:09,730
right now.

4066
06:28:10,450 --> 06:28:17,750
We know that in home supportive services that in the governor's revise is one key date that we may see some news

4067
06:28:17,750 --> 06:28:21,270
and that will allow us to react by the time we have the budget.

4068
06:28:22,410 --> 06:28:27,490
If that, another possibility is that there's some kind of extension of the current practice

4069
06:28:27,490 --> 06:28:30,270
that would go into the next fiscal year would be more of a mid-year.

4070
06:28:31,030 --> 06:28:33,710
Affordable Care Act, we know, is very unknown.

4071
06:28:34,590 --> 06:28:37,690
Everyone knows that there's a lot of uncertainty at the federal level about that.

4072
06:28:38,490 --> 06:28:42,530
We do know that the storm repairs are going to have to proceed

4073
06:28:42,990 --> 06:28:46,970
and so we're going to have to work very hard to have some solutions included in the budget

4074
06:28:46,970 --> 06:28:50,930
it as well as some longer term solutions to take care of the magnitude of the problem

4075
06:28:50,930 --> 06:28:51,490
we face.

4076
06:28:52,350 --> 06:28:56,290
So when you look at all the unknowns and you add them up, it looks like a scary number.

4077
06:28:56,990 --> 06:29:02,170
The first three are the things that we know about that are pretty certain.

4078
06:29:02,610 --> 06:29:08,730
So you get close to $10 million there in terms of what you need to absorb just sort of certain

4079
06:29:08,730 --> 06:29:12,610
and then you have these other unknowns which you don't know about yet.

4080
06:29:14,310 --> 06:29:20,510
The good news is that we have been able to absorb our status quo increases in the past

4081
06:29:20,510 --> 06:29:22,130
few years just with revenue growth.

4082
06:29:22,710 --> 06:29:26,230
It's really all these uncertainties from the state, federal, and then the storm damage,

4083
06:29:26,470 --> 06:29:29,750
so it's other things affecting us out of our control that we're going to have to react

4084
06:29:29,750 --> 06:29:30,010
to.

4085
06:29:30,710 --> 06:29:34,570
And there are also points to the need on the future of doing strategic planning when you

4086
06:29:34,570 --> 06:29:40,330
really can plan long-term to address some of these issues in a way that is more proactive

4087
06:29:40,330 --> 06:29:46,370
in instead of reactive. That concludes the presentation we have for today and I want to

4088
06:29:46,370 --> 06:29:50,310
thank the Board for your patience in sending through a very long afternoon session but I

4089
06:29:50,310 --> 06:29:54,590
think it was very useful for all of us to hear the challenges we face as we go into developing

4090
06:29:54,590 --> 06:29:55,730
this year's proposed budget.

4091
06:29:58,230 --> 06:29:59,610
Thank you, Mr. Palacios.

4092
06:30:00,000 --> 06:30:28,920
As I look at the TBD sheet, just in what we heard today, I see over $70 million, and that doesn't include the deferred maintenance on the roads. Given that we have a general fund of $128 million, when you said we only actually have control over 10% of it, it's sobering to think.

4093
06:30:29,540 --> 06:30:35,160
What is, we will or won't be able to do in the coming year, and we're going to have to make some very

4094
06:30:37,080 --> 06:30:41,900
difficult priorities. And there might, we've outlined some things in which there may be some other

4095
06:30:41,900 --> 06:30:49,500
funding strategies, you know, going out to the voters, whether it be for fire or for roads, that

4096
06:30:51,280 --> 06:30:56,160
there may, you know, the ACA may not crap out this year. It may wait another year

4097
06:30:56,880 --> 06:31:07,160
until we lose $12 million there, but you can't look at it in any way that says it is

4098
06:31:07,160 --> 06:31:13,040
in a huge hit to the county this year. Any closing remarks from my colleagues.

4099
06:31:15,440 --> 06:31:16,060
I want

4100
06:31:16,060 --> 06:31:23,240
to thank Mr. Palacios and all the department who's presented here today for their good work

4101
06:31:23,240 --> 06:31:28,040
and putting this together, I think it's useful to do this at a mid-year rate to give some

4102
06:31:28,040 --> 06:31:34,860
idea where we are and I appreciate the number of other departments who sat in to hear

4103
06:31:34,860 --> 06:31:39,160
what was going on and so they understand sort of the challenges that we faced and the

4104
06:31:39,160 --> 06:31:40,240
opportunities that are out there.

4105
06:31:41,340 --> 06:31:43,980
Thank you very much and with that we are adjourned.