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Minutes for the Finance Committee meeting on April 20, 2006.
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Finance & Administration Committee Minutes
Thursday, April 20, 2006
3:00 p.m.
Members Present were: Darrel Dover, Jim Hargis, Harold Perrin and John Street. Councilman Alec Farmer and Councilwoman Ann Williams were unable to attend.
PAST PENDING ITEMS
Banc of America lease: Mayor Formon discussed the Banc of America lease. He said originally, the lease had a 3.49% interest rate with a $6 million line of credit. But, when Mr. Larry Flowers called Banc of America Monday, one of the staff members named Bridget stated she was unsure whether the interest rate was still good. Mayor Formon tried to get a hold of Mr. Tim Cummins who had worked with the City on the lease deal. They left messages with Mr. Cummins asking to call back. Mr. Cummins returned their call and said the interest rate was still good. Then, on Wednesday they e-mailed Mayor Formon and said the interest rate was no longer good and it would go up to 3.75%. After several attempts to contact Mr. Cummins, Mr. Cummins finally e-mailed back and blamed the City Clerk’s office, saying the ordinance wasn’t published in a timely fashion. Mayor Formon then checked with City Clerk Donna Jackson, who verified the ordinance was published in the Jonesboro Sun a little over a week after it was passed by the City Council. Mayor Formon then stated he tried to call Mr. Cummins back, but did get a hold of a co-worker of Mr. Cummins’. The co-worker stated the mistake was made by Banc of America and they are to blame for the problem. Mayor Formon then contacted one of Mr. Cummins’ superiors, Ms. Hammill in Chicago. Ms. Hammill stated the best Banc of America could do now is 3.65%. Mayor Formon further explained he contacted several of the companies who submitted proposals for the original bid. Bausc stated they probably could give the City a 3.88% interest rate. It was questioned whether the ordinance would need to be published again if the only thing changed was the interest rate. It was stated that if the City decides to go with another company, the lease would have to be re-bid. But, if the City stays with Banc of America with a different interest rate, then the ordinance can just be amended. It was suggested for Mayor Formon to fax a letter to Banc of America verifying the new interest rate and allowing for Banc of America to sign the letter, locking them in for the new interest rate. Mayor Formon stated he was told by several bank institutions recently that the City did not have to bid the lease; the City could choose someone to go with. But, the City did bid the lease to try and get the best interest rate. City Clerk Donna Jackson questioned the legalities of Banc of America backing out the interest rate since the ordinance was passed, adopted and published in the correct time frame. It was stated City Attorney Phillip Crego has not looked at the lease to see what the City’s legal rights are. It was stated the ordinance would probably not have to be re-published. Mr. Brian Wadley stated Banc of America needed an answer by Monday, April 24. Councilman Street motioned, seconded by Councilman Dover, to allow Mayor Formon to accept the 3.65% interest rate from Banc of America for the lease. All voted aye.
PENDING Self-insured insurance: Chairman Perrin asked Ms. Hackney to contact Ms. Beverly Sharp to make a presentation on facts and figures to look at full-insured vs. self-insured.
PENDING Electronic Plat Submission: Mr. Alan Young stated he met with City Planner Otis Spriggs and has a proposed new ordinance. The ordinance has not been written yet. The proposed ordinance asks for subdivisions smaller than 5 acres to tie to either two GPS monuments or two existing street centerlines. For subdivisions greater than 5 acres, they must tie to either two existing monuments or set two new monuments according to established standards. Mr. Young said he would draft the ordinance to present to the Finance committee at a later date.
Chairman Perrin stated he would like to start getting the agenda and pertaining items a week before the meeting. Ms. Jackson questioned where the department heads should start contacting Chairman Perrin concerning the agenda, so he can see the items quicker. He stated the agenda items should come from Ms. Jackson. He further stated if there’s a deadline, then the items can be submitted earlier. Ms. Jackson stated that was fine, but she has no control to enforce the deadline. Councilman Street discussed an item by Ms. Gayle Vickers relating to the downtown sidewalks. The item had been discussed and approved by Public Works, but needed to be passed by the Finance committee since it calls for an extra $30,000. Chairman Perrin stated it’s not fair to the committee to be brought those things at the last minute. He further stated Ms. Vickers knew about the item before today, so it should’ve been addressed sooner. He stated if there is an item on the agenda, he wants the supporting documentation. Councilman Street stated the reason for the delay with the grant approval was because the price went up, so Ms. Vickers had to research the new cost. Ms. Jackson proposed purchasing the Legistar software to help address issues such as these. She explained the software would require the department heads scan in their items and related documents, then sends it through the approval process. She stated the software would be a solution to the problem. She added cut-off dates will only work if department heads are required to follow them and they’re not. Mayor Formon stated the software would help department heads keep track of their items better. Chairman Perrin stated he would like to research the software more before spending the money on it. He stated they’d try to take care of it as soon as they can.
MINUTES
Councilman Dover moved, seconded by Councilman Street for the approval of the minutes for the March 16, 2006, regular meeting; March 30, 2006, special meeting; and the April 13, 2006, special meeting. All voted aye. Copies were provided to all those in attendance.
ADMINISTRATION
PENDING Status of deed identification by Mr. Vic Young for City real property: Mr. Young explained the project is ongoing and should be delivered early next year. It was asked for Mr. Young to provide the committee with the contract, the scope of work, and information regarding how much work has been done in comparison to how much has been paid to the company. Mr. Young also stated the software will tie items to the data from the assessor’s office and will help with property identification. But, the City may want to do some clarification because of the way things are classified in the assessor’s office. After the project is done, he suggested hiring someone to separate and clear up the data.
Community Movie Showcase agreement: Mr. Wadley explained it is through the Arkansas Municipal League with CGI Communications. They want to create a movie and place it on the City’s web site to advertise the City. The City will be able to approve the video before it is made public. Mr. Wadley noted the video is of no cost to the City.
HUMAN RESOURCES
PENDING Firefighter pay: Ms. Hackney explained Mr. Condrey had plans to visit Pine Bluff and stop in Jonesboro during his trip. But, she no longer believes Mr. Condrey will be visiting Pine Bluff. She is going to look into how much it would cost to have Mr. Condrey visit Jonesboro to talk with the committee about the firefighter pay.
PENDING Elected officials’ survey: Ms. Hackney stated she is still receiving working on the survey and will have something at the next meeting for the committee.
PENDING Pension multiplier: Mr. Flowers stated the results should be back for the next month.
PENDING Secretary for Planning Department: Ms. Hackney explained Mr. Spriggs is holding interviews for the secretarial position today. Approximately 50 to 60 people applied for the position. Mr. Spriggs will also be going on a trip to a convention where he will be able to interview qualified candidates for the Assistant City Planner position.
Military active duty replacements: Ms Hackney asked the committee what should be done about the positions held by City staff that has been called for active duty. The staff members were told their duty could be for 18 months. Discussion was held regarding hiring replacements with the understanding their position turn into a permanent position, but at this time is temporary. It was suggested for Ms. Hackney to meet with the department heads and see what they wanted to do about the positions and if the person hired could be added permanently with the City after the active duty staff members returned from their tour.
Advertising budget: Ms. Hackney stated she only have $4011.77 left in her advertising budget. She has already spent 53% of her budgeted amount. Ms. Hackney explained she will be coming to the committee and asking for an appropriation in a few months because she’ll need more money.
INFORMATION SYSTEMS
Financial software update: Mr. Young stated there is nothing new with the software. It was questioned where the City was concerning direct deposit. It was explained they’re still trying to work out some issues with the holdback for direct deposit and the subject would need to be discussed more with the employee representative committee. Ms. Hackney said at least three days would be needed, but most places have a week holdback. It was also suggested to decide whether the City would require everyone to participate in direct deposit, or if people would be able to choose. It was asked how the Springbrook software is performing and if everything is balanced. Mr. Young stated the software works fine and he has not been told of any problems with the software. It was asked what the auditors think of the software. Mr. Young stated the auditors have no issues with the software at this point.
PENDING Fleet software: Mr. Young explained he is still working on getting the training scheduled. He has not studied the software yet and has not been given a timeline for how long the training will last. The company also has not given Mr. Young an estimate on how much the training will cost.
FINANCE & AUDIT
Request from A&P Commission for an audit of 2004 tax remittances: Mr. Flowers stated this item can be pulled from the agenda. Ms. Becky Sharp handed out a report last time and is satisfied with the tax remittances.
PENDING Privilege license update: Mr. Flowers said Ms. Sharp is still comparing rates and does not have an update at this time.
Cost estimate for non-uniform pension plan multiplier increase: Mr. Flowers stated Ms. Hackney had already covered the topic.
OTHER
Councilman Street presented the committee with the item from Ms. Vickers concerning the downtown enhancement phase II sidewalks. The engineers had to go back and get a new price for the sidewalks due to the access ramps being estimated at the phase I rate. The budget will need to be amended approximately $30,000 because of the higher prices for phase II. The additional money would come from the Capital Improvement Fund. Councilman Street motioned, seconded by Councilman Dover, to approve the appropriation. All voted aye.
Councilman Hargis discussed the regularity of the financial reporting. He stated the last report was confusing since it was for two months together. He asked for more financial reporting and asked them to be more meaningful. He explained he’d like for the reports to state how much money came in, how much money went out, what are the ongoing projects, etc. He noted the format of the report is alright, but the information in the reports is not meaningful. Councilman Perrin suggested he get together with Mr. Flowers to come up with a better monthly report. Mr. Flowers stated the reason behind the quarterly reports is because quarterly reports give a better feel of the money situation. He added Councilman Farmer asked for the monthly reports to be prepared in that particular form because the Council needed the summary information. Mr. Flowers stated Councilman Farmer put together the format. Mr. Flowers further explained Springbrook provides a lot of reports, but he’s unsure what kind of reports the committee would like. Councilman Perrin stated he would get together with Mr. Flowers before the next Council meeting to come up with a better financial report.
Ms. Jackson further discussed the Finance agenda process. She stated when Councilman Farmer was Finance chairman he took care of the agenda. Councilman Perrin stated he was asked to temporarily fill in as chairman for the Finance committee, but it ended up being permanent. Ms. Jackson explained she was trying to be helpful by putting together the Finance agenda, but the process isn’t working well anymore. Councilman Perrin suggested getting together with Mr. Wadley and Ms. Jackson to work things out. Discussion was held regarding who should be in charge of the Finance committee agenda and items that should consistently be on the agenda, like financial reports. It was added the Nominating and Rules committee was going to look at some of the procedures and processes, but hasn’t done anything yet. Mr. Wadley stated they should start by setting a deadline for the Finance agenda. It was added if an item isn’t on the agenda, it shouldn’t be discussed.
It was questioned why a financial report is not given at the monthly Finance meetings. Mr. Flowers stated he doesn’t give a monthly financial report because Councilman Farmer had suggested at a Council or committee meeting that a report to the full Council was more appropriate.
Councilman Perrin stated he can get together with Ms. Jackson concerning the Finance agenda. It was suggested not having an agenda, but Councilman Perrin stated he didn’t want to hold a meeting without an agenda. He further stated the agenda process needs to be looked at, fine tuned, adopted and then enforced. He explained the process needs to be looked at so they can work things out. It was stated Nominating and Rules has said the committee’s chairman is supposed to be responsible for the agenda. Councilman Perrin stated he will have the agenda prepared at the next meeting. It was further stated the committee should have the item information and supporting documents the Friday before the Finance meeting. Mayor Formon questioned who was responsible for items passed from one committee to another before going to Council. Ms. Jackson stated it should be the responsibility of the department heads to take care of their own items. She added if the City would purchase Legistar, the software would route the items automatically. Mayor Formon noted the software also keeps a history of items and would work with Outlook to help keep things organized. It was questioned why the price of the software went up to $81,000. Ms. Jackson explained the price went up because of added hardware that would need to be purchased for the IT Department. She added the proposal did not include purchasing of laptop computers for the Council members. Discussion was held regarding Legistar’s capabilities. Ms. Jackson stated she would like to get the software so it’s up and running before 2007. She noted Mr. John Cichon from Daystar, who held the online demo with the Finance committee last month, would be at the City Council meeting on May 2. It was suggested to have Mr. Cichon hold another demo of Legistar after the Council meeting on May 2 for any interested Council members.
PENDING Firefighters old pension fund: Mr. Flowers provided the committee with a written summary of the LOPFI actuarial study results. Discussion was held regarding LOPFI’s actuarial results. Mr. Flowers stated the City would take on additional costs if the portion of the millage dedicated to the old plan and the insurance turnback for the old plan exceeded what the City pays in. Mr. Flowers stated the payout is probably exceeding what is currently being credited to the old plan from the millage and the state turnback. Discussion was held regarding the firefighter’s old pension fund and how much the fund takes in and pays for. It was questioned how much the City is paying in for the old plan and how much total. Mr. Flowers stated he didn’t have the figures with him. Mr. Wadley stated as of March 30, the balance in the LOPFI account for the City of Jonesboro was $816,405.45. It was stated if the City is paying a deficit, then there shouldn’t be a balance in the account. Mr. Wadley stated the City has not been fully expending the account in a year. Mr. Herbert Wicker stated he sent the Mayor a letter asking for a $300 a month increase across the board. Questions were raised concerning what the City pays as opposed to what is credited by the millage and the insurance turnback. Mr. Flowers did not have the information available to explain how much the City is paying. Mr. Dan Melton stated their research shows there should be enough money in the account to pay for a $300 a month increase plus the 3% annual COLA. It was asked what the City’s payment was to LOPFI last month. Mr. Flowers stated he didn’t know what the City paid. But, he said before the City makes any decisions, things need to be looked at closely. It was asked for Mr. Flowers to bring a spreadsheet to the meeting showing all the money in the account and how it is spent. Councilman Perrin stated a special Finance committee meeting would be held next week to discuss the firefighter’s old pension fund. It was also stated the special meeting would only cover the firefighter’s pension fund. Mayor Formon added they were unsure about the legalities of using the money leftover from the millage. Mr. Melton stated they were having someone look into that.
ADJOURNMENT
With no further business, the meeting was adjourned.