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HomeMy WebLinkAbout2011-05-16 Finance Committee Minutes FINANCE COMMITTEE May 16, 2011 Councilors: Bronson, Durgin, Nealley, Weston, Palmer, Blanchette, Longo, Gratwick Staff: Cyr, Conlow, Willette, Ring, Moore, Heitmann, Beaton, Bradley, Courtney, Dawes Others: Deschane, Russell, Civiello, Thomas, Dravegis 1. Bids/Purchasing a. Lawn Maintenance – Parks & Rec – Johnson Lawn Care - $13,992 There are some smaller parcels within the parks and in the downtown that are mowed on a contractual basis rather than being maintained by Parks and Recreation. Willette reviewed the entire list of locations this year and made some changes. Cyr noted that the service was placed out for bid and three responses were received. Staff recommends award to Johnson Lawn Care for a three-year contract. Their first year price was higher but their subsequent year prices are lower. Overall, the three-year cost would be about $1,500 less than the second bidder. The City has used Johnson Lawn Care for more than nine years with very good service. A motion was made and seconded to approve staff recommendation. Responding to Bronson, Willette said it is more efficient and less expensive to contract out the service rather than using Parks and Recreation staff. Willette further indicated, responding to Bronson, that the lawn maintenance service will be extended beyond the Peirce Memorial to the edge of the Bangor Public Library. Bronson asked about the lawn around the former Police Department on Court Street. Cyr said that she follows up with the County each year asking them to include it when they do their property. The Committee vote was unanimous. b. NSP Realtor Contract – Community Development - Realty of Maine The City was awarded nearly $1.2M to purchase foreclosed or abandoned properties in order to turn them back into habitable neighborhoods or demolish those that need to be demolished. The City has purchased 10 properties thus far, six are single family homes which have been rehabbed and the City would now like to place them on the market to qualifying home buyers. In order to do so, the City would like to engage the services of a professional realtor. This came before the Business and Economic Development Committee, a proposal was issued, all Bangor real estate agents were notified, an interview process was conducted and the selection team’s recommendation is to award the contract for selling the houses through the Neighborhood Stabilization Project to Tara Roy of Realty of Maine. The commission would be 5.5%, and it is renewable if both parties deem appropriate and necessary. A motion was made and seconded to move staff recommendation. Responding to Gratwick, Bradley said the foreclosed prices ranged between $60,000-$99,000, rehab work ranged from $40,000- $50,000 and some was in excess of $100,000, and the asking prices have not yet been determined. In looking at other areas and similar properties, Bradley anticipates between a $85,000 to $150,000 range. The NSP regulations stipulate that the City cannot charge more than what it paid and what it expended for rehabilitation. The NSP is not intended to generate revenue. The money made on program income has to go back in to finish-up properties that the City has or used to purchase more foreclosed properties. The NSP extends until 2014. Responding to Durgin, Bradley said other than nd the one on Pine Street the homes are typically in the Parker, Sanford, 2 Street areas. The Committee vote was unanimous. c. Sound and Video System Upgrade – City Hall – Maine Video Systems - $80,750 The City has been struggling with its sound and video equipment used to broadcast Council related meeting on the City’s government channel. A funding source specific to this purpose is the public education and governmental contributions received from the cable franchise agreement. Staff had previously asked the Committee for authorization to issue bids ahead of time. A single response was received from Maine Video Systems of Portland in the amount of $80,750. Courtney spent some time with Carpenter, who had done a similar project for the City of Old Town, and the project mirrors Bangor’s requirements. Carpenter prepared the specifications for Old Town, and Maine Video installed the Old Town system. Staff is comfortable with the quality of work and the technical aspect. Staff’s recommendation is to award the bid to Maine Video Systems in the amount of $80,750. Responding to Durgin, Cyr said the $80,750 is generally in line with Old Town’s project, which was part of a bid process. If approved this evening, Cyr anticipates the project to be fully completed by the end of June. Weston spoke of having seen Old Town’s equipment. Cyr noted that the project will include replacement of all cameras, the mixing board, four data ports, two 60” wall mounted screens. Money was set aside last year for microphones and, while Maine Video is here working, staff will try to resolve the microphone set up and layout. One of the current audio issues is that there are 8 plugs for microphone set up at the committee meeting, and the plugs share channels. With the new system, the channels will be totally separate. Nealley spoke about the reserve account, and Cyr said the current franchise agreement expires in 2012. In response to Nealley, Cyr said that live-streaming will be a discussion item in the upcoming franchise agreement. Gratwick expressed concern that only one bid was returned from two issued. Cyr said that the City notified 10-15 companies and placed an ad in the local newspaper. One of the requirements to submit a bid for this project was that the responder needed to do a mandatory on-site inspection. Only two contractors showed up and only one submitted a bit. She feels that the integrity of the bid process was maintained. Responding to Longo, Cyr said that once the project is completed there should be no difference between the broadcast quality of cable channel 5 and 7. Palmer asked to hear from Courtney regarding the upgraded system. Courtney said that the system will be redesigned and the only thing remaining will be the microphones. The pc’s which currently run the power point slides will be replaced by a device that will be easier to manage and won’t freeze as currently happens from time to time. He noted that two new overhead speakers will replace the current two on the side of the room to improve the Chamber’s sound quality, and the wiring on the floor under the u-shaped table setting will be gone. Bronson was also disappointed that only one bidder responded. He mentioned a single video monitor in the City Manager’s area. Courtney said there will be four smaller monitors that control each of the cameras but one preview monitor. Bronson suggested that there be two monitors: one for a preview of what goes to Time Warner and one for the operator to see if the broadcast is actually going out on the air. Courtney agreed. Weston has spoken with Time Warner about online streaming and it seems to be a fairly routine addition for renewed municipal contracts. Responding to Gratwick, Courtney said if presentations are no longer on an easel but rather converted to power point or a digital application it will be a different experience according to what he saw in Old Town. Responding to Longo, Courtney said it is not recommended to wall mount the 60” screen but rather place it on an industrial audio/video cart. The unit could be turned or swiveled. The Committee vote was unanimous. d. Fuel Tank Painting – Airport – West Virginia Paint - $37,500 This will be the first time that the Airport has undertaken this project on its own. When ExxonMobil ran the fuel farm, they were responsible for bidding out these types of projects. A bid was issued and 6 responses were received. The low bidder is West Virginia Paint of Clifton, NJ, in the amount of $37,500. The second low bidder was Copia Specialty of Brewer for $38,300. The percentage difference between the bids is just over 2.1%. The initial staff recommendation would be to award the low bid but can clearly make the argument that with the $800 difference and a 2.1% bid difference that the bids are equal. In that case, the bid could very easily be awarded to Copia Specialty. West Virginia Paint has been painting the tanks for ExxonMobil for a number of years. Although Copia does not have experience in painting fuel tanks, the City has good experience with Copia Specialty on Wastewater Treatment Plant projects. Nealley made a motion to accept the Copia Specialty bid. The motion was seconded by Durgin. The Committee vote was unanimous. Blanchette asked Moore to discuss the WWTP’s experience with Copia. Responding to Blanchette, Moore said that the WWTP has had two separate contracts with Copia. Technically, there are similar issues between the Treatment Plant projects and the fuel tanks. Moore said that Copia was able to commit the personnel necessary to complete the work with a tight timeframe. Overall, Moore said he was satisfied with the two contracts. Blanchette agreed with leaning toward the local vendor. Gratwick spoke about a policy dealing with local vendor preference. Cyr said this has come up a couple of times this year and the plan is for staff and the Finance Committee to review the entire purchasing procurement policy over the summer months. She has some concerns about stating a specific local preference from a competitive standpoint. She doesn’t agree with setting a flat percentage or flat dollar amount noting that a 1% difference on a $10M project is significant. Weston said that formalizing such a policy for local vendor preference could put the City in a sticky situation. Palmer thinks that staff’s recommendation is a good one. He also spoke of artwork on the fuel tanks. Blanchette clarified that she was not implying that a policy should be in place whereby every bid would go to a local contractor. The purpose and flexibility of allowing the Finance Committee to recommend to the Council to deviate from a lower bidder and go to the next low bidder is something that should remain in place. Durgin agreed. The Committee vote was unanimous. e. Request to Sole Source – Primary Clarifier Part – WWTP Staff is requesting sole source authorization to purchase parts for the WWTP’s primary clarifier. The request is to return to the original equipment manufacturer. Over the years, other manufacturers have been tried and the fits do not exactly lined up. The City has had good experience in returning to the original manufacturer, Polychem. Moore explained the need for the original manufacturer parts. He noted that one component will be purchased from Lane as they can produce the right fit. Weston made a motion to approve staff’s recommendation. The motion was seconded by Durgin. The Committee vote was unanimous. f. Various Fuels – City Wide – Maine Energy and Dysart’s While the City uses natural gas to heat a number of its facilities, it is still dependent upon fuel. Cyr said that the City issued a request for bids for all fuel contracts and clearly stated in the bid that the City would look at entering into more than one contract if it was in the City’s best interest. For the last 6-9 years, the City has been with Irving who has provided all fuel. Staff’s recommendation is to split the bid. Cyr explained the difference between a straight truck delivery and a transport truck delivery. The straight truck is the ones that service residential clients with #2. The transports are the long tractor trailers coming to the gas stations. The City requests a rack price, the price the dealers pay and charge the City for supply on a certain day. The other piece of the request deals with any charges per gallon for transportation and the mark up per gallon for the particular product. The mark up drives the volatility or the uncertainty of the cost. The City has not been able to lock-in prices for several years. The City now doesn’t use enough #2 to lock into a price. Natural gas costs far less than #2. Staff recommends all of the straight truck deliveries be awarded to Maine Energy, who bid transportation and markup per gallon at .089 cents per gallon which is well under all of the other submitted bids. Their next lowest bid is 12 cents per gallon. Staff recommends the transport truck deliveries be awarded to Dysart’s, who came in with a .03 cent markup per gallon. Cyr anticipates a three year contract with a three year ability to renew. Both are Bangor businesses. Palmer and Dawes discussed the pros and cons of using compressed natural gas for the City’s buses. Dawes said that diesel hybrid might be part of the future for Bangor. A motion was made and seconded to move staff’s recommendation. The Committee vote was unanimous. 2. Review of Proposed Charter Amendment – Borrowing Conlow noted that earlier in the year Pauline Civiello and Linda Thomas met with the Finance Committee to discuss a proposed charter amendment on bonding limitations. At that time, the Finance Committee directed staff to work with Civiello and Thomas for the purpose of making sure that the drafted language would not damage the future borrowing for capital projects in the long term. As a result, a proposal was drafted. Conlow has spoken with the School Superintendent regarding issues including the $3M borrowed for the school’s roof. If the proposed language was in place, the City would have had to seek a vote on all or a portion of the bond including the $3M. The proposed draft has the ability to grow over time and Conlow pointed out that $1.2M is fairly low. Thirdly, Conlow said that current Charter provisions work in essence citing the recent referendum dealing with the arena project. Cyr noted that staff had presented a brief overview at the Committee’s last meeting. Durgin spoke of the concerns previously mentioned by Conlow as well as the length of time it would take to go from a perceived need, the ability to get a bond in front of the voters, and then go to bonding. Durgin served on the Charter Review Committee in 2010 and this area was thoroughly reviewed. No recommendations came forth at that time dealing with bonding. From a citizen’s perspective, Nealley said he understands some of what is being asked of the City to consider. It is well intended but he isn’t certain it will achieve the result of the citizens. Blanchette and Gratwick asked to hear from the citizens. In her 17 non-consecutive years of service on the Bangor City Council, Blanchette has never felt that the City Council has been reckless in bonding. If this proposed Charter change does go to referendum, Blanchette asked that 50% or more of the registered voters be required to approve or not approve a bond. She doesn’t think that the Council has abused its borrowing powers since 1834, the date of the City’s incorporation. Longo spoke of the threshold amount and wouldn’t be opposed to a significantly higher amount. Bronson noted that should the Council determine any particular bond should be sent to the voters that the Council would have that capability. Palmer noted that one of the greatest ways for change is how the Council body is elected. Every year a third of the councilors are on the ballot. The elective process works. Linda Thomas addressed the Committee. Regarding the arena vote petition, she heard many citizens ask how 6 or 9 people can vote to spend the money without the voters having a voice. Thomas said the answer was because the Charter allowed it. Thomas and Civiello researched various charters and, out of 44 Maine municipalities, there are 16 that have spending limitations. They specifically looked at the Charters of Lewiston, Augusta, South Portland, and Portland. In working with Cyr and Heitmann, Thomas and Civiello were appreciative of their assistance and insights into wanting not to interfere with any normal operations of the City. Portland’s formula seemed the most logical. Thomas said they are looking to provide a voice for the voter when there are significant bonding decisions to be made. She said that some concerns were voiced about being able to have a quick turnaround when the Council has something on the table that needs to be taken care of. She saw that in action when the referendum for the arena took place. There was a date set for the election very quickly. She doesn’t see that concern as an obstacle in terms of timing. Responding to Bronson, Thomas said she was quoting off hand when speaking of the 44 municipalities. She was referring to an article. Heitmann clarified that the numbers were correct and that it was a Maine Municipal Association article. Civiello said that when speaking with Cyr and Heitmann it was clarified that the Council would have first say. If the Council voted yes on a bonding, then it would go to the voters and would require a 20% voter turnout. If 20% voters did not participate, it would rest with the Council’s decision. Thomas added that the ballot would have a State Treasurer’s statement on the back so the voter would be informed both on the amount of the indebtedness that would be incurred as well as the amount of projected tax levy impact. Nealley spoke about the inference that setting public policy based on the existing Charter has been flawed. Durgin noted that the State and Federal governments do not make decisions by referendum but by the elected officials. Two-thirds of Maine communities have the ability to do this chose not to. He stated that he does not see a compelling reason to change the City’s Charter. Gratwick spoke about governments of special interest citing California where referendums have been used and over used. If this Council does not accept this proposal, Longo asked there would be another possibility for the citizens to go through to enact the policy. Heitmann said that a Charter Amendment would need to be approved by the voters. Charter amendments can be placed on the ballot by the Council or by referendum. Heitmann spoke about the required percentage of voters. A motion was made by Weston and seconded by Blanchette not to recommend approval to Council. The vote was 4-1. 3. Review of LEED Policy – Arena Project In 2007, Cyr said the Council adopted a policy requiring all new construction of City owned or funded buildings meet the Leadership in Energy and Environmental Design (LEED) certification. The arena project team has incorporated the various methodologies, technologies and management tools typically found in a LEED standard facility. In order to have a project certified, there are a number of additional costs that must be incurred not related to any of the investments in the building but related to a lot of paperwork time. The estimated cost is $250,000-300,000. Staff is diligently working with the design and the construction manager to come up with a project that meets all of the City’s goals. She noted that the $250,000-300,000 which could be spent on something that goes into the facility seems to be something the Council should discuss. Under the current City LEED Policy, the appropriate Council committee can waive the City’s LEED Policy if it feels it is in the City’s best interest. In order to qualify for a basic LEED certification, a score of 40-49 is needed. The silver certification would be 50-59. Cyr noted that the current proposed project is at about 48 points. The overall intent of the City’s LEED Policy would be met. Staff is asking that the Committee consider not going through the process of getting the structure officially certified recognizing that the LEED technologies and strategies will be used. In response to Bronson, Cyr said the LEED Policy was originally reviewed by the Finance Committee. Ring spoke about the construction aspects and the LEED criteria. Durgin asked if the City can prove that it qualifies for the 48 points. Ring referred to a standard checklist used by the arena team to track the points. In order to get the points that the design is eligible to do, a third party certification is needed. It cannot be done retroactively. Providing a breakdown of the additional costs, Cyr said that $160,000 relates to additional commissioning above and beyond of the mechanical systems. It is a fundamental as well as an enhanced commissioning. There is $30,000 to run an energy model, $55,000 related to everybody’s need to document everything to be turned in with their application. The registration and certification fee to the US Green Building Council is $21,000. Gratwick would like the City to have official documentation regarding LEEDS, and felt that the City should not back away. Gratwick said he would be interested in why the City is falling short of points on the arena project, asked if the money could be better spent to bring the project up to 49.3, and proposed that a different type of certificate given by an independent party who knows the project well. The certificate should be on the front of the building in a plaque. Ring will be keeping an eye on construction, etc. Palmer agreed that the money could be better used. It is important to do the best on the project. Longo asked if EMDC had been contacted about this. There might be an environmental organization willing to support the LEED certification. Bronson noted that he or Cyr would contact Aube tomorrow. Durgin referred to the City’s LEED Policy, which had been approved by the City, and quoting “that the requirement may be waived in an emergency situation under documented circumstances showing that compliance be cost prohibitive and/or create an unreasonable burden on the construction project of the City, have a negative impact of a historic structure, or if due to special specific circumstances, would defeat the intent of LEED certification. Any request for waiver must be accompanied by specific reasons and approved by a Committee of the City Council.” Durgin was surprised that this money had not been included as part of the project. If not approved, the Council needs to be sure of the ramifications. Conlow said that the Finance Committee originally set the policy and the waiver is in front of the committee. Conlow said the building will be energy efficient and a LEED certified building has never promised. Staff has assured the Council that the best available technology and life cycle cost will be used to determine the most efficient building in the long term. If the third party inspection is not involved, Bronson said it would be next to impossible to accomplish. The Committee needs to make a decision to spend the money or not spend the money. A motion was made by Nealley and seconded to approve staff’s recommendation to continue to build with LEED standards but not to spend the money to be certified. Responding to Durgin, Cyr said that an overall building budget was established but specifics within the building budget itself. Now that pieces of the building are costing out, pieces of the building project need to be looked at to see what works and what is in the best interests. The Committee vote was unanimous. 4. Resolve, Appropriating $85,000 from PEG Reserve to Fund Sound & Video System Upgrade Cyr noted that approval of this Resolve will recommend to Council that money be appropriated for the video and sound system upgrade. It will appropriate $85,000 from the PEG Reserve to fund the engineering/oversight and installation of a new sound and video system for the City’s Education & Government Channels. On May 16, 2011, the Finance Committee awarded a bid to Maine Video Systems in the amount of $80,750 to replace the current sound and video system. This project will involve the installation of new cameras, new mixing board, two sixty inch (60”) flat panel monitors and the installation of four presentation ports and is expected to be completed by the end of June. This system replacement is long overdue and will remedy the current audio and video broadcast and rebroadcast quality issues we have been experiencing. A motion was made and seconded to approve staff’s recommendation. Bronson noted that one item was not included on the agenda and that the Bangor Convention and Visitor Bureau will be returning to the Committee’s next meeting to discuss a request for an increase in their potential budget. Committee adjourned at 7:05 pm.