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Admin Committee Minutes 2005 01-06-05 i Page 1 of 8 APPROVED WITH REVISONS 2 -3 -05 UNITED CITY OF YORKVILLE ADMINISTRATION COMMITTEE MEETING THURSDAY, JANUARY 6, 2005 6:30 PM City Hall Conference Room CITY OFFICIALS IN ATTENDANCE: Mayor Art Prochaska (arrived 6:45pm) Police Chief Harold Martin Alderman Paul James City Administrator Tony Graff Alderworpan Wanda Ohare Finance Director Traci Pleckham Alderman Joe Besco (left 8:00pm) City Treasurer Bill Powell (arrived 7pm) Alderman Larry Kot City Attorney John Wyeth Denise Kasper, Payroll & Benefits Specialist, United City of Yorkville OTHERS IN ATTENDANCE: Hugh Robinson, Tri -Land Properties Greg Hafemann, Tri -Land Properties Kathleen Field Orr /TIF Attorney, Kathleen Fields Orr & Associates Jeffrey Warren of Burke, Warren, Mackay &_ Serritella Representing Tri -Land Properties Joe Roberts, Caywood & Associates Andrea Visione, EBC Harold Oliver Mason Oliver The meeting was called to order at 6:34pm by Chairman Paul James. NEW BUSINESS 1. Countryside Center TIF - Alternate Revenue Bond Ordinance Kathleen Field Orr, TIF Attorney, was present to speak about the issuance of bonds in conjunction with Countryside Center. She stated a total investment of $26 million is required for the rehab of Countryside Center. The developer believed that TIF permitted reimbursement for acquisition and that the City would assume acquisition costs. However, that is not the case. She further stated that the money the City will contribute cannot be used for acquisition. Further, the problem with this property is that money must be spent to tear down the present structure. Page 2 of 8 Alderman James asked what the City liability would be. Ms. Orr explained what she considered the "worst case" scenarios: 1. purchaser does not close on property 2. purchaser buys property and does not secure a lease within 3 years. The City would then lose $500,000, but the property would be more marketable after demolition. If the developer can't pay the debt service on bonds and the City must pay, this would reduce the $2.2 million note. She proposes that The City should withhold City money until some movement is seen and that will reduce the City's overall liability. Ms. Ohare added that the taxpayers' money must be protected. Ms. Orr summarized the project: 1. Once the owner acquires the property and demolishes the buildings, the City issues $2.5 million in bonds. 2. The owner secures a lease 3. When the work is completed, an additional $2.2 million note is issued 4. If any City fundsare_used, the amount of money for the developer is reduced Ms. Orr stated that TIF's are successful at least 75% of the time. If a plan does not proceed as scheduled, it can be amended. Administrator Graff asked Ms. Orr about a "trigger date" for sales tax to be used to pay down to the developer's note. Ms. Orr stated the tax is used as soon as it is generated or at the opening of the retailer. The Mayor left the meeting at this point of the meeting. Following additional discussion, Alderman James recapped Ms. Orr's presentation: 1. Developer must acquire property and raise all the money to purchase same 2. Reimburse purchaser for demolition: $500,000 3. Time frame for bond sale: March 22 4. Timeline for demolition to contract is 2 years 5. Time frame to secure contract and then building permit: not more than 3 years 6. $2.5 million is then released 7. Time frame is driven by business, written timeline will be provided. 8. The longer it takes for this process, the less money developer receives 9. Economic incentives built in i Page 3 of 8 This matter now goes before the C.O.W. on January 18 Administrator Graff asked Ms. Orr to prepare the agreement and a timeline of development events for that meeting. He also asked her to be present on January 25 at the City Council meeting. (moved forward in agenda to Presentations) PRESENTATIONS 1. Health and Employee Benefits Presentation a. Joe Roberts of Caywood and Associates b. Andrea Visione of EBC Mr. Roberts reiterated that the City's current dental and vision plan does not meet the guidelines of a qualified plan and has extreme liability. Mr. Roberts had been asked to research the best price possible for employee benefits. At this point, Mr. Graff introduced new City employee Denise Kasper, Payroll and Benefits Specialist who has been working with Mr. Roberts. MetLife was recommended as the dental insurance carrier- -they currently provide the life insurance for the City. VSP was recommended by Mr. Roberts, as the vision plan. Based on 60 employees (33 families), the total premium would be (monthly) $3753 for dental and $634 for vision, for a total annual premium for both of $52,644. Ms. Pleckham said that approximately $40,000 was spent last year for employee claims. She also said that the employees have been asking for this type of coverage. More discussion will be held to determine if the employees must share in the cost. The proposed new program would be scheduled for a May 1 St implementation. Alderman Besco voiced his approval that the program is HIPPA compliant. Alderman James then stated there were 2 decisions to be made: 1. Whether to terminate self-insurance and utilize proposed policy 2. Will the City pay for the entire program or are employee contributions necessary? Employees must receive a 90 -day notice whenever a plan changes. February 1 St would be the date the City must advise employees that this plan is being considered. Literature will be distributed to all employees. Alderman James asked Mr. Graff to advise the City staff that the Administration committee favors this plan and then he would like to bring this matter back to committee. He would like to review what has been spent in the last 3 years and also explore some options or variable costs depending on different scenarios. Alderman Kot said that if the City can afford the premium costs, it would be a goodwill gesture to not require the employees to share in the cost. A capped payout option is another alternative. Mr. Roberts then reminded the committee that he had previously suggested looking at a plan called the "125 Plan" which deals with pre -tax programs. He then also introduced Ms. Andrea Visione of EBC (Employee Benefits Corporation) to explain this program. She explained that the "125 Plan" gives employees /employers a "legal tax dodge" by I i Page 4 of 8 using flex plans. She said the average employee would save 25 cents tax on each dollar when using this plan. There are 3 items that the IRS code will allow under the "125 program" 1. Employee categories which do not apply to the employees at present 2. Voluntary health care reimbursement account FSA (Flexible Spending Account) which uses no -tax dollars (the downside is that funds are forfeited if not used) 3. Day care expense account with a cap of $5,000. The cost to the City is $720 for the set -up fee for the first year, with a fee of $450 annually thereafter. Alderwoman Ohare asked what the benefit to the City is. Employees in these flexible spending programs tend to pay more attention to costs in these consumer- driven programs. The other benefit is this gives some "insulation" to the City- - when/if the employees must help pay premiums, the City can remind them these FSA's are available to help absorb out -of- pocket expenses. A survey of the number of employees interested in the programs offered, will be taken and reported back to Administration in February. Alderman Kot concluded that these programs are excellent and education of the employees regarding these programs is very important. This discussion concluded at 7:55pm. 2. Director of Public Works Salary Survey Alderman James explained that Eric Dhuse' salary range needs to be aligned with department heads in neighboring towns. His salary was overlooked in a previous survey of other department heads in the City. If a raise were given, it must be recommended by the City Administrator and would be part of the budget process. Alderman Kot suggested that the budget be researched for any available money to give Mr. Dhuse a raise prior to the next budget. This issue will be brought back to the February Administration meeting. It was decided that a range will be determined by City staff. Administrator Graff will then call each committee member with that range in order to expedite this matter and move it onto C.O.W. At this time in the meeting, Alderman Besco left due to illness. Page 5 of 8 Treasurer Powell asked that "Old Business" Budget Report and Treasurer's Report be covered at this time. (next 2 items out of sequence) OLD BUSINESS 2. Monthly Budget Report for November 2004 Ms. Pleckham noted that the budget is on track on the revenue portion with the expenses being down. The budget is at 58.3% of the fiscal year, the incoming revenue is at 60% and 45% has been spent. Revised budget numbers will be on the December report. 3. Monthly Treasurer's Report for April 2004 Ms. Pleckham and Mr. Powell said there will be many treasurer's report at the next meeting. No further discussion. This moves to the consent agenda. (next item out of sequence - ; from New Business) NEW BUSINESS 3. IRS Code Section 61 Rule on Cell Phone Usage The IRS has a new rule that now considers cell phone usage for personal use, as a benefit that must be applied as wages or must be reimbursed. Mr. Graff said some options will be presented at the next Administration meeting. He added that Nextel has an option to have one line designated for business use and the second line designated for personal use. Personal calls would be billed directly to the employee. Auditors will be asked for direction on this new ruling and this issue will be discussed in February. OLD BUSINESS 1. Minutes for Approval/Correction: December 1, 2004 & December 15, 2004 Minutes were approved for both dates. (items 2 & 3 discussed earlier) 4. Quarterly Department Vehicle Reports These reports have been moved from a monthly review to a quarterly review. Alderman Kot noted that Public Safety Committee reviews the police reports on a monthly basis. Page 6 of 8 S. Draft Donationl5ponsorship Policy Intern Bart Olson completed a revision on this policy for a final review. Mr. Graff noted that the Mayor is asking for money in the budget for the Human Resource Commission. The Commission will be asked to research grants for special events sponsorship requests. The Commission would then make a recommendation to the Council. This issue moves to C.O.W. 6. Draft Wearing Apparel Policy The committee decided to allow an employee to spend up to $60 per fiscal year for shirts and that amount can be reimbursed. Language will also be added stating the $60 reimbursement will be contingent upon available funds. This moves forward to C.O.W. 7. Draft Tuition Reimbursement Policy Other towns were surveyed regarding their policies on tuition reimbursement. One revision made in the policy was re- wording "Council approval" to "department head approval". This change was made because Councils in other towns were not involved in this function. It was noted that City Council approval is required in the Employee Manual. This moves on to C.O.W. 8. Draft Disposal of City Property Policy Ms. Kramer revised this policy. Mr. James noted that 2 storage units have excess items that will be disposed of when this policy becomes effective. The current rent on these 2 units is $75 per unit. This policy draft will move on to C.O.W. Consent will be requested at C.O.W. on the various policies that were discussed. 9. Special Census Full and partial censuses were explored. If a partial census were to be done, 13 new developments (577 units) would not be counted. The previous full census cost was $30,000 and $150,000 in revenue was gained. An application for a full census will be recommended. There is no limit to the number of times a census is taken. The City will attempt to use the previous census takers to minimiz the training. When the contract is received, the matter will betaken to C.O.W. A timeline will also be brought to C.O.W. to indicate when the next census should be done. Page 7 of 8 10. Utility Locator Position When J.U.L.I.E. requests are made, the City must also assist in these locations. Many more locates are being requested and as a result, a full time position might be justified. Ms. Pleckham said the current J.U.L.I.E. City locator estimates 5 hours per day are spent on this function. She is working on a job description for such a position, which would report to the Public Works Director. The job description moves to C.O.W. for information and for approval of such a position. In February, a draft of the job description will be reviewed by the Administration Committee. The memo in this agenda packet will be included as part of the annual report. 11. Last Five Years Medical Costs Mr. Graff reported that no premium costs were included in the information from Caywood, however, general costs were included. Blue Cross will provide the percentage and actual amount of increase to the City over the past few years. Administrator Graff noted that there is now a $40 monthly charge for the Police and he anticipates an increase of 35 -40 %. " I This item will be discussed again at the February Administration meeting. 12. RFQ Policy It was recommended to adopt a policy to require RFQ's for all professional services. One of the issues stressed was the interview process and who would be involved in the process. One suggestion was to require Council approval of all RFQ's before being advertised. Many more RFQ's are anticipated in the future. A policy will be drafted and moved to C.O.W. When approved by Council members, the matter would be sent to the appropriate committee for action. ADDITIONAL BUSINESS Alderman Kot said off -hour use of equipment (copiers, phones etc.) should be placed on the next agenda. Pass codes were suggested for all equipment users. It was noted that elected officials now have computer logons available. There is no cost for these logons. Fencing around the air conditioning units, for security /safety reasons, was suggested by Alderman Kot. Chief Martin added that the generators would also be fenced. This issue will be addressed at a future meeting. Alderman Kot asked that it be noted in the minutes that Intern Bart Olson has done a very professional job. i Page 8 of 8. Alderwoman Ohare noted that the City Hall flag is ripped and needs replacing. Any budget requests should be suggested to Ms. Pleckham prior to the February 3rd Administration meeting. A special meeting will be requested in February or March. Administrator Graff would like to initiate surveys of each department regarding their manpower allocation in relation to expected growth and how that compares to other communities. He would bring that information to the March meeting. He would also like to request staff input for redoing the bill list. Because of the growing bill list, he would like to suggest a list review meeting prior to the regular committee meeting. Chairman James cited the amount of time Ms. Pleckham must spend to prepare for questions regarding the bill list. Mr. Graff would like to research how other communities handle this procedure. This bill list matter will be placed on the Administration February meeting agenda. Alderman Kot reminded the committee that the bill list must still be approved by the Council, which in turn, opens the possibility of added discussion. Mr. Kot added that there had been previous discussion to expand the "detail" area of the bill list. There was no further business and the meeting was adjourned at.8:55pm. Minutes respectfully submitted by Marlys Young, Minute Taker PLEASE SIGN IN MEETING: DATE: NAME STREET ADDRESS CITY -13' U N t'✓ ArSA old Wiz-- P5 -� u V1 I A l 0 r , PCL, r �I