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HomeMy WebLinkAboutFinance 07-22-08 NOTICE OF COMMITTEE MEETING AND AGENDA ST. CROIX COUNTY FINANCE COMMITTEE DATE AND TIME: Tuesday July 22, 2008 — 8:30 A.M. LOCATION: Room 1281, St. Croix County Government Center, 1101 Carmichael Road Hudson, Wisconsin CALL TO ORDER ROLL CALL ADOPTION OF AGENDA DATE OF NEXT MEETING: August 7, 2008 APPROVAL OF MINUTES OF PREVIOUS MEETINGS: July 3, 2008 OLD AND NEW BUSINESS: 1. Building Services Report a. Heating/Cooling System for Government Center b. Government Center Roof Choices, Timelines and Cost Estimates c. Update on HHS Buildings Roof Repairs d. ADRC Office Expansion Option 2. Human Resources Report a. Joint Meeting with Ad Hoc Negotiations Committee — 10:30 a.m. Closed session per WI Stat. 19.85 (1) e for the purpose of discussing bargaining strategy for LAW contract. Reconvene into open session to complete other agenda items. b. Proposed Behavioral Health and Youth Community Support Services Reorganization in Health & Human Services ** 3. Finance Report a. Request to Reallocate Department Budget for Employee Portal Module in Finance Software b. Bond Process for Borrowing 4. Risk Management Report a. 2009 Liability Distribution 5. Administrative Coordinator Report a. 2009 Budget Issues i. Non - represented Compensation and Benefits Package Options ii. Work Schedules and Business Hours of Operation Options b. Interim Budget Steps Continued i. Review of department revenues and expenses ii. 2008 budget actions relative to carryover for 2009 budget iii. Discussion of hiring and purchasing freezes 6. Short and Long Term Planning Goals — Follow Up to Board Goal Setting Session ADJOURN (Items may be taken in different order) * *Additions /Changes /Corrections Items for County Board approval must be submitted to the County Clerk's office by Wednesday morning preceding a County Board meeting. 2:18 PM 7/16/2008 OFFICIAL -approved 817108 MINUTES OF THE ST. CROIX COUNTY FINANCE COMMITTEE JULY 22, 2008 Meeting called to order by Chair Standafer at 8:30 a.m. Present: Esther Wentz, Sharon Norton - Bauman, Lorin Sather and Daryl Standafer; Clarence Malick arrived at 8:36 a.m. Staff present: Administrative Coordinator Chuck Whiting, Finance Director Michelle Pietrick, Human Resource Administrator Tammy Funk, and County Clerk Cindy Campbell. Others present: Roger Rebholz, Julie Speer, Roger Larson, Dick King. Media present: Judy Wiff. Motion by Wentz, 2„d by Sather to adopt the agenda. Carried unanimously. The date of the next meeting is August 7, 2008 beginning at 8:30 a.m. Motion by Sather, 2 by Wentz to approve the minutes of July 3, 2008. Carried unanimously. 1. Building Services Report. a. Heating /Cooling System for Government Center. Building Services Director Art Tobin and Robert Aschenbrenner of Karges - Faulconbridge, Inc. (KFI) were present. Review of comparison report summary which included comparisons of a base case: high efficiency water - cooled chiller, condensing -style boiler — installed cost: $1,672,500 with yearly utility cost estimated at $155,200; geothermal option: high efficiency water -to -water heat pumps with installed cost of base case plus $675,000 and yearly utility costs to base case minus $8,900 with a simple payback period of 75 years; and ice storage: uses base case chiller / boiler plant, but includes ice storage with installed cost base case plus $67,500 and year utility costs base case minus $4,900 with a simple payback period of 14 years. Demand of electrical charges and other costs discussed. Malick asked if we were on the threshold of a step function for greater efficiency and less costs and consideration of potential development on the Government Center site which may lead to other buildings needing heating and cooling installation. Discussion regarding generators. Tobin stated the new generators would use both oil and gas. Standafer expressed concerns about making decisions on a piecemeal basis instead of the big picture and concerns of getting into a situation that in two to four years the configuration does not meet the needs of this building. Aschenbrenner stated from a mechanical perspective we need to look at what we've got and replace it and added if future expansion is necessary the ice storage system could be expanded. Malick questioned the volatility of the estimates and asked if there would be a change in costs? Aschenbrenner stated the construction costs include a minimum and maximum with contingency included. Amounts are based on recent bids. Aschenbrenner indicated in order to have firm number he needs to send this to KFI's estimating department and would not likely have firm numbers ready by August 7th Motion by Sather, 2 nd by Wentz to go with ice / thermal storage base case chiller / boiler plant. Discussion to add an alternative to include ice / thermal storage. Aschenbrenner stated bids would include the added alternative. Motion by Malick, 2 " d by Sather amending the motion to include authorization for KFI to proceed at the county's expense to obtain from KFI's estimate department a tighter number and proceed in the direction to include an add alternative ice / Finance Committee July 22, 2008 Page 2 of 6 thermal storage. Amendment carried unanimously. Discussion regarding obtaining a solid estimate. Aschenbrenner stated he is confident with the numbers related to equipment and real -time. Whiting requested KFI bring back bid phase amounts to the August 7 th meeting. Standafer requested cost estimates for the remainder of services. Standafer summarized the amended motion is to authorize approval of the base chiller / boiler concept and ask KFI to proceed with a tight estimate and explore the ice / storage thermal option emphasizing the estimate be completed as soon as KFI can. Carried unanimously. b. Government Center Roof Choices, Timeliness and Cost Estimates. Discussion regarding bids from Derrick Construction and Fischer Company. Tobin reviewed job sites done by both companies. Duralast and Fischer Company have solar panel products which would be welded onto the roof. Tobin stated there's a possibility of a $250,000 grant for solar panels. The Duralast roof estimate is $457,000 which includes insulation replacement. Discussion regarding the high density concrete and jail pod if drilling into high density concrete is possible. Tobin is waiting to hear from Ayres Associates on this issue. High density concrete would cost more. Tobin stated the companies could start in five to six weeks after notification and possibly completed in two to three weeks. Fischer is working on estimates to include solar panels. Warranties discussed. Tobin will review looking at extending the warranty to 20 years. Standafer confirmed $500,000 for planning purposes for the roof replacement and requested solid numbers back by August 7 Malick would like to see one more estimate on solar panels and integrate into the roof for solar to electric and solar to heat on all suitable surfaces. C. Update on HHS Buildings Roof Repairs. Tobin stated the HHS roof repairs from the storm damage last month is approximately $180,000. Risk Manager Kristin Ziliak, contacted the insurance carrier and for the six roofs in the New Richmond campus the County is responsible for up to $15,000, leaving a balance $165,000 carried by insurance. Tobin stated this is for the committee's information. d. ADRC Office Expansion Option. Present: Art Tobin, ADRC Director Brad Beckman, and HHS Director Fred Johnson. Standafer expressed frustration with the lack of discussion about space issues without it following a random course of who is dealing with it and requesting it. Tobin stated the plan for ADRC is currently seven people on staff with an additional six others or for a total of 12.5 people in the ADRC suite. Tobin expressed the need for a conference room with teleconference equipment. Tobin is obtaining amounts for electrical work, changing walls from temporary to sheetrock, and in -house work for a cost savings. Staffing issues, furniture and traffic flow within the department addressed. Estimate for work and furniture is $70,000. Johnson noted the space behind the ADRC suite was vacated by IT and is part of the plan for additional space. The plan all along was to have a "one -stop shop" for ADRC and the Government Center is more accessible and inviting for consumers. Discussion regarding HHS building and the future of the building with transitioning six staff out of HHS and into ADRC. Johnson indicated state funding available for renovation costs which he believes is $39,000 but will confirm this with the state and how it will be rolled out. ADRC will open its doors on August 1 St and others will transition in by the end of the year. Funding will kick in on August 1st. Norton - Bauman expressed the need for a long -range plan for space but in the meantime felt approval of $30,000 with the state's $39,000 for the renovation is needed. Motion Malick, 2 nd by Wentz to approve. Discussion regarding other office space at the Government Center. Standafer asked why a determination is necessary now and suggested waiting Finance Committee July 22, 2008 Page 3 of 6 until there's a better idea of what and where the space needs are since ADRC will be up and running August 1. Beckman stated $39,000 needs to be used in 2008. Motion by Malick, 2 " by Sather to table until the next Finance meeting so ADRC can weigh in on the concept. Carried (Norton - Bauman voted no.). 2. Human Resources Report. a. Joint Meeting with Ad Hoc Negotiations Committee — 10:30 a.m. Closed session per WI Stat. 19.85 (1)(e) for the purpose of discussing bargaining strategy for LAW contract. Reconvene into open session to complete other agenda items. Motion by NB, 2 " by Wentz to move into closed session per WI Stat. 19.85 (1)(e) for the purpose of discussing bargaining strategy for LAW contract. Roll call - all ayes. Carried unanimously. Others present in the closed session: Ad Hoc Negotiations Committee members — Supr. Leonard and Supr. King. Also present: Rebholz, Speer, Whiting, Funk, and Sheriff Hillstead. Motion by Sather, 2 "d by Wentz reconvene into open session. Carried unanimously. (11:16 a.m.) b. Proposed Behavioral Health and Youth Community Support Services Reorganization in Health & Human Services. Present: Fred Johnson, Ron Kiesler and Kathy Dunlap. Johnson stated this proposal for reorganization was supported by HHS. Kiesler explained driving factors to reorganize ten positions in the Behavioral Health and Youth Community Support Services Department include: the resignation of a Behavioral Health Therapist; resolve Behavioral Health Therapist vacancy in a timely manner to reduce disruption to outpatient services to clients; current reduced need for Adult Community Support Services; current increased need for Youth Community Support Services; 2008 -2009 Behavioral Health Strategic Plan initiative to develop a centralized intake and assessment position/unit; 2008 -2009 Youth Community Support Services Strategic Plan initiative to centralize information flow. Kiesler stated the proposal is for 20 positions (19 1/8 FTE) compared to the current organization which is 20 positions (19 1 /10 FTE) with an approximate savings of $6,225. No action taken. 3. Finance Director Report. a. Request to Reallocate Department Budget for Employee Portal Module in Finance Software. Finance Director Michelle Pietrick explained there's an Employee Portal Module available for the finance software in the amount $4,260 which would allow employees access to their information such as direct deposit slips, W -2s, etc. This allows the Finance Department to stop printing direct deposit slips and eliminates the need to fold and stuff them in envelopes. Pietrick will reallocate part of her budget to purchase this portal. The committee agreed. No action. b. Bond Process for Borrowing. Nick Dragisich, Brenda Krueger and Joe Murray of Springsted were present. Dragisich stated Springsted is a full service advisory firm and was asked to evaluate the County's financing needs for the Government Center's HVAC and roof options. Springsted is compensated for services, not on a percentage of bonds. Murray explained $2,000 is built into the Costs of Issuance line item for Springsted estimated costs. The Costs of Issuance totals $24,750 which also includes fees for the bond counsel and paying agent registrar and rating. This is based on the assumption of $2,000,000 borrowing. Murray explained the financing is anticipated to be publicly issued as General Obligation Promissory Notes that would be paid back over ten years with Finance Committee July 22, 2008 Page 4 of 6 the first interest payment April 1, 2009, and semi - annually thereafter, but postponing the first principal payment until April 1, 2010 to wrap around the County's large debt service payment of $2,751,007 in 2009 for existing debt. Murray added the County could also shorten the proposed term of the notes to less than 10 years resulting in a savings in interest cost. Best interest rates will be obtained through the competitive bidding process. Krueger reviewed services in the financing process. She added the bids are collected in the St. Paul office and reported back to County. Assuming bonds are awarded, Springsted completes the process through the closing. There will be two resolutions -- one sets the sale and the other sells the bonds. One resolution is required to have a three- fourths vote of the entire County Board (24 votes) which they prefer to have on the first resolution. Net Debt Service Schedule reviewed. Murray reviewed the potential schedule for County consideration. Initial proposal presented July 22 and the Finance Committee decides to proceed with public financing Springsted moves forward to work with bond counsel for next meeting, August 7 th which outlays the promissory notes, including terms and schedule, and authorizes Springsted to work with the County. The Finance Committee would make a recommendation to the County Board at the August 19 meeting which begins the debt service schedule. The sale date is anticipated to be October 20 to go back to the County Board and on October 21 allow the proceeds to be wired on or about November 15. 4. Risk Management Report. a. 2009 Liability Distribution. Risk Manager Kristen Ziliak explained the Liability Fund is allocated into each county department budget which is a process to build the Liability Fund. Ziliak provided options for consideration for the 2009 budget. The entire WMMIC Incurred Reserves amount would be $969,387 for department allocation. The liability insurance fund is $1,697,530. Pietrick explained the auditors record it as a liability and expense. Ziliak provided various percentage proposals. The 2007 audited fund balance was $728,000; and the annual aggregate was $1,500,000. Ziliak recommends a 46% allocation for 2009. Incurred but not reported withheld is $969,387 which is an unfunded reserve. Ziliak stated Option C which is a 46% allocation still builds the fund. Motion by Malick, 2 "d by Sather to adopt the recommended budget Option C. Carried unanimously. Standafer stated this should be part of the budget instructions to the departments. 5. Administrative Coordinator Report. a. 2009 Budget Issues. i. Non - represented Compensation and Benefits Package Options. Pietrick stated currently the salary rolled into the 2009 budget is at 0% for non - represented employees and LAW union. Pietrick stated the Finance Committee needs to decide on a number now and deal with it in the budget, or make no decision and then add into the budget. Pietrick stated one option is to figure the percentage and Springsted costs and increase the Contingency Fund by that percent. Discussion. Motion by Malick, 2 " d by Norton - Bauman to recommend a 0% increase for 2009 non - represented salary increase into budget preparation. Whiting reminded there is also health insurance figures. Norton- Bauman stated the committee needs more time to review budgets before plugging in a number which is locked in the budget. Malick suggested making Health Reimbursement Account (HRA) mandatory for non - represented employees starting in 2009. King suggested treating Finance Committee July 22, 2008 Page 5 of 6 non- represented employees the same as union employees. Malick requested a future agenda item be a resolution presented indicating no new positions. Carried unanimously. Funk requested a decision be made if HRA and Retirement Health Savings Plan (RHS) options are going to be optional or mandatory. Discussion regarding making it optional in 2009 and mandatory in 2010. Motion by Norton - Bauman, 2 " d by Sather that 2009 be optional for HRA for non - represented employees and mandatory in 2010. Standafer prefers to make it mandatory January 1, 2009. Motion by Malick, 2 "d by Norton - Bauman to amend the motion to make the HRA deadline mandatory January 1, 2009 for non - represented employees. Amendment carried 4 — 0 (Sather abstained). Amended main motion carried 4 — 0 (Sather abstained). Sather left the meeting at 12:34 p.m. Retirement Health Savings (RHS) addressed. Funk explained conceptually this equates at the end of the year there will be no discretion in terms of sick leave payout which will be a specific policy. The cash option goes away and the County does not manage their money. Whiting stated this will be cashed out at the time of retirement. Funk stated there are 58 employees greater than 55 years of age which have a long term sick bank which equates to $635,000. Motion by Malick, 2 " by Norton - Bauman to mandate the RHS on January 1, 2009. Carried unanimously. ii. Work Schedules and Business Hours of Operation Options. Whiting asked if the committee would consider options in changing work hours. Whiting stated Tobin suggested if this building was not open as often it would save on energy costs. Discussion regarding problems with changing work week and work hours and cost savings to individual employees commuting. Malick suggested considering making this voluntary giving employees the option with supervisor approval a four -day work week in exchange for no salary increase for a year for non -union employees. Options discussed. Norton - Bauman would like to hear the Judges' position on four -ten work days or four -nines and asked how much money is saved. Funk asked what the public perception would be because we provide a service. Malick suggested a rewrite of the policy with regard to the county's attitude of job sharing for consideration on the next agenda and proposed Whiting present this at the next Department Head meeting. Motion by Malick in which non - represented employees would be offered, effective January 1, the option of a salary freeze combined with a four -day work week of the same number of working hours (lateral transfer of hours) with supervisor's approval. Standafer called for a second. Motion died for lack of a second. Wentz left the meeting at 12:57 p.m. b. Interim Budget Steps Continued. Whiting has nothing to propose for this item. A "no new position resolution" will be placed on the next Finance Committee agenda. this item. i. Review of Department Revenues and Expenses. Whiting has nothing to propose for ii. 2008 Budget Actions Relative to Carryover for 2009 Budget. Pietrick stated there will be a carryover from the Nursing Home but will report on this in August. It was clarified the Finance Committee July 22, 2008 Page 6 of 6 carryover is not a profit from the Nursing Home, but is unspent dollars. Any perceived carryover is budget minus expenses. iii. Discussion of Hiring and Purchasing Freezes. Discussion regarding purchasing freeze. Pietrick reported on a recent run on purchases of computers and chairs. Pietrick asked parent committees review departments where they are at in their current budget. Malick suggested making that part of the budget review. Malick suggested extending position vacancies for one month unless there's County Board approval. Funk asked for consideration of overtime and loss of revenue. Discussion regarding early retirement incentives. Malick requested a proposed policy for early retirement incentives be brought to the August Finance Committee meeting. Norton - Bauman asked if the Finance Committee should consider meeting more than once a month and asked to receive meeting materials in advance. 6. Short and Long Term Planning Goals — Follow -Up to Board Goal Setting Session. Whiting reviewed the 2008 goals. Discussion regarding performance measures by department and numbers to show achievements during annual department reports and to review previous department annual reports for comparisons by going back five years. Meeting adjourned 1:45 p.m. Sharon Norton - Bauman, Secretary Cindy Campbell, Recording Secretary