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HomeMy WebLinkAbout2011-12-05 Finance Committee Minutes FINANCE COMMITTEE December 5, 2011 Minutes Councilors: Durgin, Sprague, Gallant, Gratwick, Blanchette (voting members) Hawes, Longo, Weston Staff: Cyr, Yardley, Morgan, Conlow Others: Andy Sturgeon, Elizabeth Sutherland 1. Consent Agenda A motion was moved and seconded to approve the Consent Agenda. Gratwick spoke of the importance of the hazardous universal waste collection and disposal. a. Bids Awarded by Staff – November 2011 b. Ratification of Grant Application 2. Bids/Purchasing a. Utilities Survey – Engineering – Sewall Company As part of the FY12 budget, the Council appropriated about $40,000 to further assist the City’s internal GIS mapping. A portion of that was awarded earlier by the Finance Committee. The tax maps have been converted on the GIS system. The parcels do not line up requiring someone to physically go back to place them appropriately at an approximate cost of $16,000. There is approximately $24,000 remaining from the $40,000 appropriation. The next part is to survey all of the City’s data points; i.e. utilities, light poles, sewer, water. It will be a long term project. Four sewer subsections were identified dealing with stormwater and the urban impacted stream designation. Surveying and the collection of data point information can be done by a variety of methods depending on each individual company and their equipment and staff. The City was not able to go out for a fixed bid but sought proposals. Six were received. Engineering staff reviewed all proposals. The recommendation from staff is to award the contract to Sewall Company due to their extensive existing survey and control that they maintain within in the City. The Sewall Company maintains a Boresight Survey Control Network within the City’s boundaries and these are 30 survey control points that are permanently established and maintained by Sewall. These are very well known data points and, from that, they can read other data points needed by the City as well as set control points that would be used further down the line to establish data points. Sewall has agreed to allow the City to use this network for other City projects as well. The cost proposed by bidders varied from $50 to $60/hour. The prices were all similar but could not be defined as a low bid situation. Staff looked at the equipment, the manning and the experience of each firm. The City will be charged by Sewall on a per hour basis, and the work will cease once the $24,000 cap is reached. Morgan noted that he was happy with the interest expressed by the proposers and with staff recommendation. Weston asked if there is an estimate as to scope of work to be established for the $24,000. Morgan felt that the $24,000 will cover one-fourth of the City. Staff will be meeting with Sewall on a weekly basis. In response to Gratwick, Sean Gambrel will be processing the data received from Sewall. Gallant asked if the ‘four areas’ are actually defined in the contract. The end results need to be itemized and clearly defined. Morgan noted that scope of work to be accomplished has been clearly identified in the contract. Blanchette spoke of the City’s valued working relationship with Sewall. A motion was made and seconded to approve staff recommendation. The vote was unanimous. 3. Order, Accepting and Appropriating Funds Raised by the Bangor School Department for Fuel Assistance Yardley noted that the Bangor School Department approached him with an idea to do a ‘Bangor Spirit Day’ the last day that school is in session before the Christmas break. They will be collecting food and cash, and Yardley was asked to find appropriate uses for both. The plan calls for students to bring in canned goods and Yardley will distribute it to area food cupboards. The second piece is for those who wish to donate cash and the funds generated will be donated to Health and Community Services to meet the need of those in need of heating oil who do not qualify for general assistance. Staff asked for Committee approval for Yardley to distribute the items and money once gathered. Blanchette and Gallant commended the School Department for the effort. A motion was made and seconded to approve staff’s recommendation. Blanchette also urged Council Members to bring in their monetary or food contribution. Gratwick suggested plastic for window coverings. Yardley thanked him for the suggestion. Blanchette noted that the plastic sealing is a fire hazard. The vote was unanimous. 4. Review of Budget Variance Report – September 2011 Cyr reviewed a prepared detailed report dealing with 2012 budget variances for the first quarter of the year. Gratwick expressed appreciation for the information provided. He questioned the amount of staff time involved. Responding to Gratwick, Durgin agreed that this level of detail has not been available in the recent past and will be provided once a month. Currently, the City’s software is not equipped to provide a dashboard review. Staff is working on RFP for updated software and equipment. Durgin referred to the information as a transparent approach to show the citizens of Bangor what the City’s finances are and how they are being handled. This information will also be posted on the City’s website. Cyr said it takes a longer amount of time for the first report to be set up. For a couple of months, it will require 4 hours of time to prepare. Conlow said the budget is built based on what has already taken place. She spoke of state revenues, trends, and what comes out of the Legislature and the Assessor’s assessed evaluation. Weston noted that there is not a window component to the City’s current software, which is 17 years old. Sprague and Cyr spoke about Enterprise Funds specifically the Economic Development Fund. Overall, the Committee expressed appreciation to Cyr for the report. Responding to Blanchette’s question about revenue gained from Hollywood Slots, Cyr said she would include the information in the same email to Council regarding the Republic Parking contract question. Longo asked about monies available to pay Bangor schools to participate in local parades. Durgin noted that the Bangor Rotary Club is the parade sponsor and handles all of the parade financing. He agreed but said that the matter needs further discussion. Weston questioned Durgin’s yes response. He feels that Bangor pays the School Department $50M a year already and paying an additional fee for a band to participate in a local parade would be out of bounds. 5. Order 12-017, Authorizing Refinancing of Certain of the City’s Existing Bond Obligations Cyr explained that this Order would authorize the issuance of $5,347,300 general obligation bonds to refinance previously issued debt ($5,230,000 in outstanding 2002 bonds, $117,300 to finance the cost of issuance which includes $52,300 in premiums to bondholders). In total, as the short term municipal bond market remains favorable, the City anticipates issuing approximately $6,525,000 of 10 year debt in January. The rest of the financing has been previously approved in separate bond orders to finance current capital improvements. Based on current market conditions, the City anticipates realizing significant savings over the remaining life of the debt. The City’s financial advisor has indicated that we can expect an interest rate of approximately 2.5% on the new issue compared to the rates currently carried by the existing debt of 4.20% to 4.75%. By taking advantage of the current interest rate environment, it is anticipated that this refinancing will result in interest cost savings over the next 10 years of approximately $500,000 within the General Fund, School Department, and Sewer and Parking Funds combined. Responding to Gratwick, Durgin said there are going to be costs of issuing the bonds, legal fees which can only be estimated at this time. As the actual bonds are being prepared, a final figure will be available. Cyr said the major unknown is when the City issues debt it does so on a bid basis. The interest rate estimate is provided by the City’s financial advisor. A motion was made and seconded to recommend approval. The item will appear on the upcoming December 12 Council agenda. It will require a public hearing at that time. 6. Order, Accepting Donation of Website Content Management System from Sutherland Weston Marketing Communications Cyr noted that during last fiscal year the City was looking to use about $20,000 to hire an outside firm to assist in building a website. The money was available through a position vacancy in Information Services. Due to the hiring of Megan Collins, who has an extensive website design background, it was then not necessary to hire a company to perform the design work. The City only needed to obtain a content management system, which is necessary to author and maintain the content of a website. It provides the necessary framework, the template, and standardized styling to display the website content. Councilor Weston offered to donate the website content management system of Sutherland Weston to the City at no cost. Had this donation not be made, the City would have needed to purchase the system as well as incur an annual maintenance fee. This Order would accept the donation of a website content management system from Sutherland Weston Marketing Communications. Cyr noted that the acceptance should have been done a few months ago when it was donated. Gratwick made a motion to move acceptance, and the motion was seconded. Speaking of business law at Husson College, Longo said that when decisions are made without a board’s approval it is not good thing unless the board ratifies it. It creates the CEO or the City Manager in this case liable for damages incurred. He said that when one Councilor gives a donation it gives the perception that other Councilors may not have the same access to staff. Not all Councilors are in a position to make a donation. Longo expressed concern that this item was not previously brought before the Council. Longo asked if there was a conflict of interest for Weston to be discussing this item. Longo mentioned that Sutherland Weston had bid $29,000 for the marketing contract for Pay as you Throw/Single Stream. He again mentioned perception by impropriety. Durgin asked Conlow to comment. Conlow said there was a procedural issue and she apologized. The City does business with a lot of people and the City gives everyone equal access. When a bid is issued, the low bidder can win the bid just as any Councilor who bids on work within the City as part of their business. If they are not low bidder, they do not get the bid. Conlow noted that she is straightforward and above board. She cannot be bought for $7,000 on a free website. She noted that there was a bid of $3,000 on a website content management system. If the Council wishes to go with the $3,000 bid and not accept the free donation, the City can do so. The decision to accept the donation was not done in any way to creative favoritism for Sutherland Weston, who provided a free service. Sutherland addressed the Committee. Her company did put in a proposal for the Pay as you Throw marketing campaign that was determined not to be given to anyone as the project as scrapped. The difference between their bid and the competitors was that Sutherland Weston had $11,000-15,000 worth of media to pay local radio and tv stations. The intention was for it to be very clean and straightforward as to what they expected the City’s total cost to be for the project. Gallant said he wasn’t sure why the City wouldn’t graciously accept a donation from anyone. He questioned if there was a procedural process which was not abided by; it’s more perception. He moved to accept the donation. Durgin clarified that there was already a motion with a second on the floor. As an elected representative of the City, Weston noted that the Council has a responsibility to act in the highest integrity and Longo’s previously made comments violate that. Weston personally took offense to Longo’s comments about insinuation, perception and lack of integrity. That comment not only offended Weston but it offended a business, a taxpayer and an employer in the City of Bangor. Weston wished that Longo and others would watch their words carefully. He noted that Longo is one of nine elected to represent Bangor. He asked Longo to please respect the process and watch the perception of his own words as he moves forward. He asked that Longo respect not only the businesses at this table but businesses in the community. Blanchette said there is a process to follow when anyone makes a donation to the City. There are nine Councilors who should have known the rules. Ignorance of the law is no excuse. The Councilors are the policy makers, and the City Manager does as the Council directs her. For his protection and that of the City, Blanchette questioned if Weston should be involved in the discussion this evening. Blanchette felt a vote of the Council should be taken to determine if a conflict exists. Blanchette asked if a monetary donation has been made in the past by a seated Councilor. Blanchette requested Durgin to call for a vote on conflict of interest on Councilor Weston. Durgin noted that Weston is not a member of the Committee and does not have a vote this evening. Blanchette said that is not the issue. Weston is an elected official. Weston offered to leave the room. He noted that there is no financial interest on his behalf that would generate a conflict. Gallant said there needs to be a factfinding to determine the validity to the actual facts to determine if there is a Charter or a policy in place to deal with the situation at hand. Durgin referred to Conlow’s comments of earlier in the meeting about not bringing this to the Council sooner should satisfy Gallant’s question. Conlow suggested that she obtain an opinion tomorrow from the City Solicitor. The Solicitor had spoken with Longo earlier suggesting that the matter be handled through tonight’s Committee process. Gallant agreed. Gratwick felt a legal opinion is needed. He voted to pass the item onto the th Council at is December 12 meeting. Hawes commented that as the policy makers of the City the Council does have the right to look at anyone in terms of a conflict of interest. She, however, is not comfortable at this point to vote on a conflict. She did not agree with a Councilor feeling the need to leave the room when the discussion was almost at its end. As a group, the Council needs to be more aware of what potentially has a conflict and deal with it early on in the meeting. Blanchette noted that she had to leave the room earlier during the discussion due to a personal issue. Had she been at the table, she would have requested that a vote be taken on the conflict issue. Longo quoted a portion of the Charter dealing with gifts and favors. Durgin asked Conlow for a ruling from the City Solicitor on this issue. Durgin deferred the motion as a no vote tonight indicating that it will come forward to the Council at its December 12 meeting. Durgin declared the motion as out of order. Gratwick noted that a motion and second was on the floor. A motion was made and seconded to postpone the item until clarification is received from the City Solicitor. The vote was unanimous. Cyr suggested that the Executive Session be moved into another room in order to accommodate the upcoming meeting to be held in the Chambers. 7. Executive Session – 36 MRSA Section 841 (2) – Hardship Abatement A motion was made and seconded to move into Executive Session 8. Open Session – Hardship Abatement Decision A motion was made and seconded to approve staff recommendation Committee adjourned at 6:11 pm.