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HomeMy WebLinkAbout04-10-2007 Clerical CommitteeCLERICAL COMMITTEE Tuesday, April 10, 2007 - 6:30 p.m. Historic Depot, 50 North 4th Avenue Aldermen in attendance -Joe Berardi, Jim Hartford, Craig West, Larry Sarff, Kevin Meade, Les Carl, Eric Schenck, Sonya Lewis. Absent: None. Others in attendance: Mayor Rodney W. Heinze, City Clerk Nancy Whites, Deputy City Clerk Diana Tucker, City Treasurer Kathy Luker, Interim City Attorney John McCarthy, Police Chief Jeff Fritz, Fire Chief John Stanko, Public Works Director Clif O'Brien, Wastewater Treatment Plant Supt. Joe Carruthers, Water Treatment Plant Supt. Greg Pollitt, Zoning Officer Clark Wilson, Street & Garbage Supt. George Spahn, System Maintenance Supt. Bill Terry, Maurer Stutz Inc. engineer Keith Plavec, Joe Ginger video service. In the audience from the Journal Star Jenny Freeman, Daily Ledger John Froehling, WBYS Mark Bixler, Auditor for the City Jim Hocker, SRPED Mark Rothert, several residents of Lawrence Drive, Lee Puelo, Chad Murphy, Dennis deBourbon, Candidate for office in Ward Two Kurt Skender, DeCott representatives Scott Child and Steve Guy, Energy Resource representative Mark Pruitt. Finance Committee Alderman Les Carl, Chairman Bills. Motion and second by Aldermen Sarff/Meade, all bills be refer to council. The motion carried by voice vote, and was unanimous. Treasurer's Report. City Treasurer Kathy Luker stated that the report was for 11 months of this year. The ESDA account shows a negative balance of $7,010.53, and Kathy will bring a Resolution to the next council meeting for transferring of funds into the ESDA account. The Health Care fund showed $3,924.00 in the black. The reason for this was claims were down for the last two weeks of March. On page two under the TIF Accounts Recap for IH Balance is $72.05. Kathy Luker said next month she would be receiving Tax Levy funds, so this account should have a higher balance. Budget Report. Motion and second by Alderman West/Sarff, to refer the Budget Report to council. The motion carried by voice vote, and was unanimous. 1 Clerical Committee meeting 4-10-07 MFT Bid of Letting results on April 9th. Keith Plavec from Maurer & Strutz Inc. reported that three bids were turned in. None of the bidders provided a Certificate of Eligibility with their bids as specified in the Project Specials, therefore this requirement was waived and the bids were read. The bids were as follows: Engineers Estimate: Bidders: R.A. Cullman Laverdiere Construction Advance Asphalt $ 77,290.00 $ 78,139.88 +1.10% $105,952.42 +37.08% $ 77,283.08 -0.01 The improvements will be along Spruce Street, Avenue C, ad Olive Street; new storm sewer along Spruce Street from Avenue B to Avenue C; miscellaneous sanitary sewer Manhole replacement; sanitary sewer lining; sanitary sewer point repairs. Keith Plavec recommended to award the low bidder of Advance Asphalt of Princeton. Motion and second by Aldermen Sarff/West, to accept the low bid of Advance Asphalt for $77,283.08 for the bid of letting, and refer to council. The motion carried by voice vote, and was unanimous. GASB 43/45. Jim Hocker the City of Canton's CPA Auditor reported from the report of MarAcon, LLC who did the actuarial valuation of the City's retiree health insurance program under the applicable GASB accounting standards. Jim reported the postretirement benefit obligations and annual expense under the accrual accounting standards of GASB 45, using a valuation date of Apri130, 2007, are as follows: Actuarial Present Value of Future benefits $13.3 million. Actuarial Accrued Liability $11.1 million. Annual Accrual Expense -year One $1.3 million We projected the City's annual pay-as-you-go retirees costs over the next 25 years. Suggested several alternative contribution patterns for pre-funding the City's future retiree benefit obligations. We recommend that the City establish an 2 Clerical Committee meeting; 4-10-07 irrevocable trust to pre-fund future retiree benefits. Reasons for pre-funding include enhanced benefit security for both retirees and active City employees, as well as the actual and perceived financial soundness of the City in the medium to long term. The City is not yet required to adopt accrual accounting standards for retiree healthcare benefits, but this will happen in the near future. The new GASB standard, GASB 45, published in June, 2004, will have an effective date of July 1, 2007 for the City. GASB 43, pertaining to the financial statements of the retiree fund itself, would take effect one year earlier; however, the City has no fund at present so GASB 43 is not yet applicable. Both standards encourage early compliance. There are two considerations regarding GASB 43 and GASB 45 that needs to be mentioned. 1. Both statements specify that in order for a retiree fund to be counted as "assets" for purposes of the statements, the fund must be set aside in a separate, irrevocable trust, that may not be used for any purpose besides the payment of plan benefits to retirees, and is beyond the reach of creditors of both the employer and/or the plan administrator, if any. For example, an earmarked reserve within the General Fund is not expected to meet this definition of "assets". We recommend that the City consider taking steps to establish a retiree fund that meets the GASB requirements, as soon as practicable. 2. There is considerable confusion among public agencies over what GASB 45 and does not require: specifically, many agencies initially believed that GASB 45 required pre-funding of retiree health insurance programs. This is not the case -the standard applies to the expense to be charged to the agencies' income statements. Contributing to the confusion is the terminology used in both GASB 43 and GASB 45 for the annual expense -it's called the "Annual Required Contributions" even though it's neither required nor (necessarily) contributed. We do not believe that it is necessary or even desirable for an agency to contribute the full ARC on a cash basis each year. In some cases the recommended funding contribution will be higher than the ARC, in other 3 Clerical Committee meeting 4-10-07 cases lower. The reasons for this are a bit complex and beyond the scope of this report, but the important thing to understand are that GASB 45 pertains to the income statement and funding pertains to cash flow, and there is no need for the two to be directly linked, at least for now. We have determined that the annual expense for the fiscal year 2007-2008 under GASB 45, if adapted early, would be $1,252,020. This amount is referred to as the "Annual Required Contributions", or "ARC", under GASB 45. The $1,252,020 is comprised of the present value of benefits accruing in the current year. (called the "Service Cost") and a 25-year amortization of the UAL. Because the City is expected to pay $422,266 for the 2007-2008 fiscal year in healthcare costs on behalf of its retirees, the change to accrual accounting would represent an increase in annual expense of $829,754. Alderman Carl said it would be in a future budget for funding. Alderman Carl thanked Jim Hocker for coming and explaining GASB 43 and GASB 45. Electricity Discussion. Alderman Carl thanked City Treasurer Kathy Luker and Alderman Joe Berardi for seeking help with finding alternative electricity supplier for the City of Canton. Kathy then introduced Mark Pruitt of the Energy Resource Center. Mark mentioned this is the government organization that would be purchasing the energy for the City of Canton under the State Bid Program. Mark said he received a refresh price quote from the Energy Resource Center. For example, it we had the ability to purchase our electricity today through Energy Resource Center, the cost savings would be $54,989.95 and you have a copy of the proposal that I e- mailed today. The approximate fee cost of .5% would be $1,868.99. Mark said he was also asked if other entities such as hospitals, park districts, libraries, or businesses could sign up for the State Program? In response Mark answered, small businesses and non-profits don't fit that description, so they cannot join this program. However, if the city has an interest, I am certain that my Director would allow me to design a program that would make it easy for local businesses to get good pricing and terms from a supplier or multiple suppliers. In fact, we've floated this idea to the Illinois Department of Economic Opportunity in the past, so if there was an interest among your business 4 Clerical Committee meeting 4-10-07 base, we might be able to convince the Agency to support the minor costs associated with developing the program. In any case, we are willing and able to assist private entities get through this as well. Please let me know how best to help. Mark said he could have refreshed pricing on either Monday or Tuesday for your Baard meeting. Interim City Attorney John McCarthy said he reviewed their contract and it is similar to the State of Illinois bid for police cars and the like. Allows the City of Canton to terminate with a 15 day notice without penalty. Alderman Schenck ask about if the City of Canton would still be receiving free therms on some of the city owned property? Interim City Attorney John McCarthy answered, you can bundle your accounts, and you don't have to enter those receiving the free therms. Alderman Berardi said what was told on March 27, 2007 at the Mechanical Committee meeting does not reflect the $74,000 savings, I don't see any savings at all! Mark Pruitt answered, I disagree with you. I will provide for you estimates from Peoples Energy. Alderman Carl thanked Mark Pruitt for coming to make his presentation. Alderman Berardi introduced Steve Guy and Scott Child managing partners of DaCott Services. Scott Child gave their report again as Steve Guy made a presentation on March 27, 2007. You start with what that energy price is. The higher the load factor, the closer the price will be to the market price for block power. Energy usage is not typical. Most suppliers will not let you out of their contract. ICAA does not have fees to join. Take a look at your energy supplier plan, make sure it is what it is. Alderman Meade stated the main point here is the entry point! Alderman Carl said we need to made a decision tonight to recommend to council. Motion and second by Aldermen Meade, to allow for ICAA to do some comparisons for the City, and city attorney to draft a resolution. Discussion. Alderman Meade said we have not received a contract from ICAA. Scott Child said he would forward a contract to John McCarthy. 5 Clerical Committee meeting 4-10-07 Alderman Sarff mentioned for them to come to next weeks council meeting on April 18. The motion carried by voice vote, and was unanimous. The Finance Committee went into a break period for 5 minutes at 9:03 p.m. The Finance Committee came back into session at 9:08 p.m. HoteVMotel Tax request for Spoon River Blues Festival. Motion and second by Aldermen Meade/Sarff, to refer to council. Discussion. Dennis deBourbon is the contact person, and he is requesting $7,500 from the Hotel/Motel Tax. Interim City Attorney John McCarthy said they would certainly qualify for the funding if there is overnight guest. This will be held on July 28t'' according to Dennis deBourbon. Alderman Schenck stated this is a great thing and would like to see it tied in with something going on downtown on Friday or Saturday night. The motion carried by voice vote, and was unanimous. MSI's proposal for Professional Services for Avenue C Sanitary Sewer Design & Construction. Keith Plavec from Maurer Stutz Inc. said this agreement is in regards to the Avenue C Sanitary and Storm Sewer Project that received grant funding by the Department of Commerce & Economic Opportunity (DCEO). Our total fee is $67,000 for design, bidding and construction phase services. The grant will pay $42,000 of the total $67,000. The remainder of the funds is budgeted to come out of the 2007- 2008 Bond expense budget. The City will pay $25,000 and $11,375.00 will be under the bonding dollars. We are trying to create priorities after finding the problems. Alderman Schenck wanted to know the cycle time for applying for grant funds? Keith said at the end of this year he can and will submit a grant. Motion and second by Aldermen Sarff/Meade, to refer to council. The motion carried by voice vote, and was unanimous. Leander Construction & Inc. Application for payment #9 for Kilroy Pumping Station in the amount of $52,248.75. Motion and second by Aldermen Sarff/West, to approve payment #9 for Kilroy Pumping Station in 6 Clerical Committee meeting 4-10-07 the amount of $52,248.75, and refer to council. The motion carried by voice vote, and was unanimous. Budget 2007-2008. City Treasurer Kathy Luker explained the suggested changes. Credit to the expense are the following: 3% Employee Health Reimbursement $6,700.000 Administration $42,000.00 Police $24,000.00 Fire $10,000.00 Street $10,000.00 Garbage $2,300.00 Water & Sewer $1,300.00 Administration $3,800.00 System Maintenance $11,800.00 Water Plant $12,700.00 Waste Water Treatment Plant $2,400.00 Under Clear Well Project $1,500,000.00 Clear Well Project $1,500,000.00 Lime System $ 275,000.00 Reclassification Lime System $ 275,000.00 Suggested a $10,000.00 cut to Spoon River Partnership Economic Development Mark Rothert. And a suggested cut of $30,000.00 for the Dare Subdivision. Motion and second by Aldermen Meade/Sarff, to give $85,000 to the SPRPED by adding the $10,000.00 back into the amount. Discussion. Alderman Berardi said it's a conflict of interest for Alderman Meade to make the motion. Interim City Attorney John McCarthy ask Alderman Meade if he receives any pay for serving on the SRPED committee? Alderman Meade said he receives no pay for his position on their board. The motion carried by voice vote, and was unanimous. 7 Clerical Committee meeting 4-10-07 Legal & Ordinance Alderman Craig West, Chairman Jeff Williamson -Lien. City Zoning Officer Clark Wilson remarked this is to pay for the demolition and tippage fees as a lien has to be filed on the property. Motion and second by Aldermen Sarff/Meade, to research the property and file a lien. The motion carried by voice vote, and was unanimous. Ordinance No Parking Sign at the 1000 Block of Lawrence Drive. Alderman Sarff said he has been working with the residents for several weeks on their issues of cars blocking mail boxes, they can't see to get out of the driveway, debris is bad, the kids congregate. Several of the residents were in the audience. Police Chief Jeff Fritz worked with the residents and thought had resolved by no parking on East side of the street for one block. Since that time the residents have come up with some problems. Chief said there are holes in the fence on school property on the north side of the school so they can park closer to the building. When the school changed the key system, this did not rectify the problem. Alderman Sarff said the residents leaf pickup and garbage pick up has been out of control last two years. He asked the residents if they approved of 2 hour parking for both sides of the street? They were in agreement and Alderman Sarff explained this will become an enforcement issue. Residents suggested having the 2 hour parking down to Ma-Gra-B1. Police Chief Jeff Fritz said that the officer would have to check the tires he marks in the 2 hour period. Resident Howard Dye did not feel the 2 hour limit would be enforceable. Alderman Sarff said do 2 hours from Linden to Ma-Gra-B1 on both sides of Lawrence Drive from 7:00 a.m. to 4:00 p.m. Monday through Friday. Motion and second by Aldermen Sarff/Carl, to have the city attorney draft the changes to the ordinance, and refer to council. The motion carried by voice vote, and was unanimous. Howard/Alice McAdams -Water Pre-Annexation A reement. Motion and second by Aldermen Sarff/Meade, to refer to council. Discussion. 8 Clerical Committee 4-10-07 Zoning Officer Clark Wilson mentioned that the property is in Westgate and not contagious to the City of Canton. Howard McAdams is a contractor and builds homes. The motion carried by voice vote, and was unanimous. Casey's Store & Gas Station -Liquor Request. Alderman West asked for someone to come forward and present their request, and no one came forward. The Legal & Ordinance Committee adjourned at 6:48 p.m. Community & Industrial Development Alderman Kevin Meade, Chairman Update Mark Rothert. Bill Kemper has a business in the Industrial Park. SBC/ATT was contacted to get high speed DSL. Their engineers are currently determining feasibility. A current business operator will be requesting a road expansion at the Industrial Park to accommodate the expansion of his business. Mark said he is working with an entrepreneur to start a small business at the Industrial Park as well as pursuing a lead with Alderman Berardi for another user at the park. Tony Fahrenbruch was recently approved for a low interest loan through the Prairie Hills Resource Conservation and Development, Inc. for his business at the Industrial Park. He will soon be up and coming. Blessings business at 74 North Main after their fencing went up they had a lot of favorable comments, and it looks great. Design facade for downtown guidelines, will check with Zoning Officer Clark Wilson before any acceptance is made. A grant for facade in the downtown kept the momentum going as Dick Versace did his building on the East Side of the Square and Leo Puelo on the 9 Clerical Committee meeting 4-10-07 North side of the Square has table and chairs outside in the summer months and the area is surrounded by fencing. WalMart, have been working with them to get them back interested in Canton. Alderman Schenck said it is very important to keep in contact as they are looking North of the City of Canton. Working on a IH Enhancement grant. In collaboration with IDOT on infrastructure around schools. The Community & Industrial Development Committee had finished their agenda under the Finance Committee, so the time could not be listed when adjourned. NEGOTIATIONS, GRIEVANCE & PERSONNEL Alderman Larry Sarff, Chairman There were no items listed on the agenda. Informational. The Negotiations, Grievance & Personnel committee will be having an executive session on Monday April 16 at 6:00 p.m. at City Hall, 2 North Main Street. Purpose being to discuss Public Works Contract. The Negotiations, Grievance & Personnel Committee adjourned at 10:00 p.m. Recording Secretary, Nancy Whites, City Clerk 10