Here’s what you need to know:

  • The Council (3-0) voted revisions to the Mobile Food Truck Ordinance, including adjusting operating hours to 5:00 am to 12 midnight. 
  • Regarding the financial health of the City of Kerman CaPERS Plans, the City is in the Caution Zone. The most current actuarial report received in July 2021 shows a funded status within 61 percent to 90 percent.
  • A category in the American Rescue Plan Act (ARPA) rules that claims up to $10 million awards for general government purposes provides “useful” flexibility for the City to offset COVID impacts and fund projects.

The Scene

According to its website, the City Council serves as the policy-making board of the City. The Kerman City Council has five members, including the Mayor. The City elects its mayor for a two-year term and Council Members for four-year terms.  

The City Council meets on the second and fourth Wednesday of each month at 6:00 p.m. at the Kerman City Hall, 850 S. Madera Ave. The meeting is accessible through Zoom.

Officials Present:

  • Mayor Gary Yep 
  • Mayor Pro Tem Ismael Herrera 
  • Council Member Jennifer Coleman 
  • Council Member Kevin Nehring

Officials Absent 

  • Council Member Bill Nijjer 

Others Present:

  • City Clerk Marci Reyes
  • Carolina Camacho
  • John Jansons
  • Ismael Herrera
  • Mary Rodriguez
  • Michelle Zaragoza
  • Josefina Alvarez
  • Ariana Mendoza
  • (559) 567-6159
  • (559) 567-8470


The Council (4-0) unanimously approved the items as follows:

A. Council approve March 9, 2022 – Special Called/Regular meetings 

B. Council approved the payroll as presented. 

C. Council approved warrants and electronic bank transfers as presented. (Under Government Code 37208) 

D. Council waived the full second reading and by motion adopted an ordinance amending Section 2.55.060 of Title 2, Chapter 2.55 Regarding By-District Elections and Adjusting the Boundaries of City Council Elections Districts Required by Law. 

F. Council by motion adopt a resolution accepting the 2021 Housing Element Annual Progress Report and authorize staff to submit it to the California Department of Housing and Community Development and Governor’s Office of Planning and Research. 

G. Council by motion adopt resolution reauthorizing remote teleconference public meetings by the City Council and all boards, commissions, and standing committees of the City under Assembly Bill 361. 

Department Reports include the following: 

A. City Council reviews and considers the City’s current Mobile Food Vendors Ordinance and determines. Mayor Yep recused. 

1. Maintain the current ordinance (Kerman Municipal Code Sections 8.40.010 to 8.40.060) as is; or 

2. Amend the current ordinance to adjust operating hours to 5:00 am to 12 midnight, or 

3. Amend the current ordinance to change hours of operation and conditions of approval.

A couple of months ago, the current regulation and hours related to the food truck ordinance were problematic for the operators. 

The Council requested the Chamber of Commerce to provide a survey, which helped address the issue.

Residents and business owners prefer food truck options. The food truck ordinance has been ongoing for two years. 

The operating hours are limiting, and operators sought to capture lunch business.  The ordinance is open to revision.

Susan Juanfranco recommended a committee to handle the sanitation of food trucks.

The Council (3-0) voted revisions to the Mobile Food Truck Ordinance. 

B. Council reviewed the Mid-Year Budget Report and adopted a resolution amending the Fiscal Year 2021-22 Budget. 

The City adopted the 2021-22 budget on June 23, 2021, with a General Fund deficit of $2,853,622 when considering Measure M operational & capital project expenses, or $1,030,056 taking out Measure M expenses, from the other (General Fund) GF departments. 

One of the budget goals for the Fiscal Year 2021-22 is to complete the Master Fee and Cost Allocation Study to update the Citywide fees for services according to their actual cost and diminish the subsidy the GF provides to render these services to our community and investors.

Because of the unexpected increase in property taxes, sales taxes, increased fees for services, and intergovernmental revenue (ARPA),  staff recommends adjustments to the General Fund and the Enterprise Funds to the adopted budget. 

General Fund (GF) budget 2021-22 had a deficit of $2,853,622. 

Mid-Year budget review projects the deficit to change into a surplus of $1,576,288 due to the recognition of ARPA funds into GF. 

General Fund cash reserves at June 30, 20201 were $8.410,469 and are expected to increase by $1,576,288 to end FY 2021-22.

This increase is due to the ARPA funds and the delay in completing the capital projects appropriated for this Fiscal Year under Measure M.

The General Fund (GF) accounts for taxes and other general-purpose revenues (e.g., sales taxes, property taxes, franchise fees, permits, rents, and fines).

GF provides essential general governmental services (e.g., legislation, administration, city clerk, police, parks and recreation, public works, and planning and development). The GF’s two primary sources are sales taxes and property taxes, with 80%

When the FY 2021-22 budget was approved, the expectations for the GF’s two primary revenue sources, sales tax, and property tax, were conservative due to COVID 19 regulations and uncertainty. 

However, the revenue collection for the first half of the fiscal year shows differently.

Overall, the revenue collected at mid-point is 76%, compared to the budget amount projected. 

The recommended adjusted ending Budget 2021-22 for General Sales tax is $2,121,739 or 5% decrease when compares to budget adoption, Measure M Sales and Use Tax $2,768,311 or 6% increase, and Property Tax revenue amount is $2,452,248 or 5% increase, in the aggregate, an amount of $7,342,298 or 3% increase.

There are other General Fund revenues adjustments. 

  • Increase fees for services by developing projects such as residential homes by Century Communities, Crown Homes, and the Valero gas station /convenience store.
  • Increase intergovernmental revenue by taking the standard allowance for governmental services authorized in the final rule released in January 2022 for Non-Entitlements Units (NE), cities under 50K population, like the City of Kerman.
  • Increase rental fees due to the increased use of City facilities and the completion of lease agreements.
  • Increase miscellaneous revenue due to our worker’s compensation insurance reimbursement for 4850 claims.

The revenue collected for the first half of the year, December 31, 2021, is $3,831,165 of the annual budget amount of $6,990,497. 

Most Enterprise Funds exceeded or were at the expected 50% projection at mid-point. 

Overall, revenue collected during the first half of the fiscal year is 55% compared to the adopted budget amount.

The adopted budget General Fund (GF) total expense for FY 2021-22 is $11,777,004, which includes $4,423,679 appropriated for Measure M’s operational and capital projects; at the mid-point, the GF has used only 39 percent if compared to the adopted budget amount.

The recommended adjustments to the General Fund expenses that are not part of Measure M accounts for $465,796. 

  • Increase Administration Department expenses due to one-time incentive and recognition payment to employees in appreciation for the extra effort was made to provide the services required by our City residents during the COVID 19 pandemic.
  • Decrease Measure M expenses due to the limited resources available to procure the capital projects allocated for 2021-22 due to the COVID 19 pandemic, such as the East Side Park project. The timing and results of grants applications such as Clean California for the downtown revitalization and the denial of the grant application for the Multigenerational Community Center.
  • Increase legal services due to the labor negotiations and personnel matters.
  • Increase Engineering and community Development Department expenses due to services required by the development occurring in the City.
  • Increase in Recreation Administration and Senior Center Department due to the rise in the cost of electricity and reduction on the compensated absences liability

The Enterprise Funds in the aggregate show a total expenditure of $3,541,058 as of December 31, 2021, of the annual adopted budget amount of S6,548,700. 

At mid-point, most Enterprise Funds are close to 50 percent of the budget, except for the Sewer Fund at 61 percent and the Technology-(ISF) at 68 percent. 

The City adopted the Enterprise Funds (water, sewer, solid waste, storm drain, ISF, and L&LD) for budget 2021-22 with a surplus of $441,797 (excluding major capital outlay items). 

Mid-Year budget review projects an ending budget of 2021-22 with a surplus decrease of $104,805 to end FY 2021-22 at $336.992.

Enterprise Funds (water, sewer, solid waste, and storm drain) cash reserves at June

30, 2021 were $4,241,189.

For the Fiscal Year Ending 2021-22, it would increase by 14 percent at $4,836,927. 

This projected surplus will allow the City of Kerman to continue leveling back the reserves and savings to invest in future required infrastructure projects in the water and sewer systems.

Regarding the financial health of the City of Kerman CaPERS Plans, the City is in the Caution Zone. 

The most current actuarial report received in July 2021 shows a funded status within 61 percent to 90 percent. This range, according to CaPERS, is considered to be a Caution Zone.

The City can do the following:

  • Establish a policy to address the stabilization of future contributions payments to CaPERS if the City encounters a deceleration of the economy, creating a shortage of revenue required to make those future payments. 
  • Propose change in CaPERS policies such as the amortization period or the discount rate, which will create a significant increase in the required payments affecting the liquidity to cover budget appropriations to regular operational expenses. 

Staff is currently working with a recommendation for developing and implementing this policy and will come back in a later meeting to introduce the subject.

C.American Rescue Plan Act Program and Use of Funds (JAJ) 

1. Receive a presentation on the American Rescue Plan Act, including compliance and reporting requirements, and 

2. Authorize staff to pursue the Standard Allowance under the U.S. Treasury Final Rule for ARPA funds.

In March of 2021, Congress authorized the ARPA program. The program awarded the City of Kerman was $3.6 million. 

The first payment to the City was on July 2021, which was $1.8 million and accompanied by guidelines for allowable use. 

A category in the American Rescue Plan Act (ARPA) rules that claims up to $10 million awards for general government purposes provides “useful” flexibility for the City to offset COVID impacts and fund projects. 

The Council adjourned at 9:00 pm. The next Council meeting will be on Wednesday, March. 23, 2022, at 6:00 pm through Zoom. 

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