Shewmaker Suggests Changes, Council Approves Budget Amendment That Lowers Reserves

The five hour meeting ended after a lengthy back and forth on the general fund reserve policy


Jessica Shewmaker takes the oath of office for a second time on Feb. 5. Photo Credit: Joshua Sanchez/SAC.Media.

Her first day on the dais, Jessica Shewmaker provided suggestions and solutions to the council’s discussion of accessory dwelling units, “unexpected” expenditures, and tried to explain the council’s confusion to the finance director on Feb. 5,

With regards to the ADUs, she was thanked by residents for mentioning that people moved to West Covina for the lot sizes and advocated for a larger than 5 foot setback to properties. Shewmaker then suggested that different standards and rules be set for different spaces. Garages and other buildings would be separated by being attached or detached and whether or not people are living in the space, under Shewmaker’s proposed revision.

This led to Shewmaker recommending action be taken on the public hearing item, which had been moved to right after the presentations for eight speakers concerned about ADUs. She added that the old changes of the planning commission should be adopted now, and that the issue should be brought back as changes to the entire code with consideration to how the law will change before it is brought back.

After much deliberation, the council voted in favor of enacting the previous ordinance at a 4-1 vote. Mayor Pro Tem Tony Wu made the vote against this decision, arguing that the state will likely enforce a similar law to the new ordinance in the future.

The city had received 76 letters in opposition before the meeting, but one speaker held 84 letters on behalf of 118 residents. At one point while Wu spoke, they handed out some of the letters to other people in the chambers against the new ordinance, and the group held up the letters.

Wu and Shewmaker were on the same page about the “unexpected” expenditures that led to a budget amendment. Both questioned how the city staff was not able to anticipate paying off legal fees and expenses of that nature.

Wu brought up that one of the lawsuits started in 2015, and Shewmaker added that there needs to be a real discussion on how much money is needed for legal and other expenses.

“We cannot continue to have two million dollar surprises,” Shewmaker said.

The last surprise of the evening was a back and forth between the new finance director and Wu. Where Wu kept asking the director why 17 percent of the unassigned fund balance is being used to cover operating expenses, if it were to be a reserve.

The director did not understand what Wu meant and kept referring to the change in percentage from 17 to 15.23 percent as “cash flow” which would not affect the 17 percent reserves. They added that they should not have included the slide reflecting the budget amendment but were requested to do so.

It took Shewmaker explaining that the council perceives a reserve as a savings account for the director to, after more back and forth, agree that the amendment lowered the reserves down to 15.23 percent.

The total of 17 percent reflected $11,122,534 in unassigned fund balance, which would cover two months worth of expenditures.

With the amendment, it sits at $10,310,736 and 15.23 percent.

The city of West Covina, still in bad shape from bonds and litigation, will now have to come up with a two million dollar revenue surprise to revert back to the 17 percent policy.