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Minutes for the Finance Committee meeting on December 18, 2003.
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Finance & Administration Committee Minutes
Budget Overview
Thursday, December 18, 2003
5:00 p.m. - Huntington Building
Members Present: Alec Farmer, Darrel Dover, Jim Hargis, and Harold Perrin
Members Absent: Ann Williams Others present were: Judy Furr, John Street, Hubert Brodell, Larry Flowers, Bob Andrews, Jim Hargis, Suzanne Hackney, Alan Young, Rusty Grigsby, Butch Herring, Gene Barnett, Ron Shipley, Claude Martin, Bill Roddy, Dawn Riggs, Rick Elliott, Tim McCall, Floyd Johnson, Keith Inman, Jonesboro Sun and Donna Jackson, City Clerk.
MINUTES
Councilman Perrin moved, seconded by Councilman Dover for approval of the minutes for November 20, 2003. All voted aye. Copies were made available to those in attendance.
BKD - STREET AUDIT REPORT
Mr. Kevin Kemp and Ms. Cindi Hovis provided the final audit findings from the Street Department audit. It was explained the report did not contain findings on and financial statement review nor was it a fraud investigation, but rather their intent was to provide recommendations for areas of improvement and efficiency as it pertains to internal controls and procedures. Some of the findings listed were as follows: procedures did not coincide with policies; lack of proper educational background; lack of documentation of adequate work experience; and lack of certification of Arkansas Commercial Driver’s licenses. Regarding purchasing procedures they found a lack of requisitions and approval of requisitions, lack of appropriate bids taken, with an inadequate segregation of duties. Ms. Hovis explained there had been an allegation of illegal acts, fraudulent or inappropriate transactions with a certain vendor, and identified 63 transactions totaling $942,891.86 with the vendor during 1997 through 2000. The report stated the City Council approved contracts with the vendor, however a significant number of the items billed on the 63 invoices did not appear to be included in the contracts approved by previous City Council. Councilman Farmer stated questions regarding this matter should be referred to City Attorney Phillip Crego.
HUMAN RESOURCES
Compensatory Time & Salary Survey - Ms. Hackney explained it would take $8,476.98 to bring everyone down to forty hours comp-time and from that time forward no one would be allowed to accrue more than 40 hours of comp-time. Councilman Perrin stressed the policy manual needed to include who would be responsible for keeping up with compensatory time. Ms. Hackney stated the new software system would assist in keeping up with the comp-time, but it was agreed comp-time would have to be approved by department heads. Ms. Hackney also provided changes to the proposed compensation policy and procedures from the Condrey & Associates salary survey. The changes made were as follows: Page 6 - Section 2A to include the Mayor; Page 7 - Section E to include the Mayor and Section F removed the wording “subject to the Human Resource Director”; Page 8, number 6, pertaining to merit increases was deleted in its entirety. Finance Director Larry Flowers recommended changing the wording on Page 7 pertaining to part-time pay increases, “shall be determined by the yearly budget”. Councilman Perrin moved, seconded by Councilman Dover to recommend to the full council for approval of the proposed compensation policy and procedures contingent on the changes made as stated previously. All voted aye.
Councilman Perrin raised the issue of doing job descriptions. It was determined that Ms. Suzanne Hackney, Human Resources Director would provide recommendations to the committee.
Extended Medical Leave Request
Ms. Hackney stated she had a leave request from a police officer who has used all of her paid medical time, and recommended approving the request pending medical certification which Ms. Hackney had not been provided. Councilman Perrin stated prior to the committee being asked to approve extended medical leave there should be a form that has been signed off on by the Mayor, Human Resource Director, and appropriate department heads. The issue arose due to unanswered questions pertaining to how the employee intends to repay the city for the leave. Because the employee was out of time, Councilman Perrin moved, seconded by Councilman Dover to approve the extended medical leave for thirty days, pending medical certification. All voted aye.
Police Chief - Fire Chief Status
Councilman Farmer stated the process has been delayed because of the budget, and stated they are making sure all the ordinances are addressed so there is no conflict. It was explained that a job description is needed for Police Chief, Fire Chief, Asst Police Chief and Asst. Fire Chief along with a pay schedule which was not included in the Condrey Survey. Committee members were told this should be available at the next Finance Committee meeting.
BlueCross/BlueShield - Paperless Enrollment
Ms. Hackney reported the City Attorney has approved the online enrollment and Human Resources will begin enrolling employees online. Councilman Perrin requested a BCBS representative be available to answer questions for new employees who are enrolling in the plan.
COPIER LEASES
Finance Director, Larry Flowers stated Mr. Steve Kent, Purchasing Agent would begin the bidding process. Mr. Kent responded saying it would be after the first of the year before he could do anything. Mr. Kent was instructed to have different companies to do a study for the purpose of determining the needs of various departments prior to the bidding process.
FINANCIAL SOFTWARE CRITERIA & AMENDMENT 78 - LEASE PURCHASE
It was explained the first step in planning for the city’s financial software is to determine what the needs are of each department. It was recommended having a list of questions prepared prior to making any road trips to other areas.
ADMINISTRATIVE BUDGET TRANSFER
Mr. Flowers explained, based on the opinion of the Legislative Auditors, a transfer was made to the 2003 general fund from the proceeds of the ½ cent sales tax a pro-rated cost allocation of the following offices: Mayor, City Clerk, City Attorney, Administration, and Human Resources. Mr. Flowers explained it was based on the theory that since all these departments were doing work on behalf of the street department the $155,000 transfer was justified. He explained in 2004 $175,000 has been budgeted, but requested a legal opinion from the City Attorney with regard to being able to continue to fund the entire street department through the ½ cent sales tax money. Mr. Flowers was asked to get an opinion from the City Attorney and report back to the committee.
PROPERTY LIABILITY INSURANCE
Purchasing Agent Steve Kent reported the city’s insurance cost went up by $30,000.00 and has not been bid out in approximately five years. He stated every time the insurance was let for bid there would only be one bidder which was Gallagher & Gallagher, and the reason was because the City of Jonesboro was a high risk insurance group. It was requested that Mr. Kent provide a summary sheet regarding the City of Jonesboro’s coverage. Mr. Kent responded saying Gallagher & Gallagher would like to address the committee. Councilman Farmer asked that Mr. Kent set up the meeting with Gallagher & Gallagher for the February committee meeting. Mr. Kent reported he had requested five years ago to have the property and buildings valued in order to determine if they could be replaced. He explained Gallagher & Gallagher wanted the information.
PROPOSED FINANCIAL POLICIES
Councilman Farmer provided a model for financial polices. He explained it reduces to writing how the finances of the city should be handled.
ADJOURNMENT
With no further business Councilman Dover moved, seconded by Councilman Hargis to adjourn.