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HomeMy WebLinkAbout2009-11-16 Finance Committee Minutes FINANCE COMMITTEE November 16, 2009 Councilors: Stone, Palmer, Weston, Bronson, Hawes, Blanchette, Gratwick, Wheeler Staff: Little, Barrett, Farrar, Dawes, Caruso 1. Consent Agenda a. Election Ballot for Municipal Review Committee Board of Directors b. Cargo Scales – Airport – Alliance Scale - $12,367.50 A motion was made and seconded to move the Consent Agenda item (a) and to ask that the item (b) Cargo Scales item be referred to New Business on the agenda due to the fact that new information has been provided. 2. Bids/Purchasing Cargo Scales – Airport – Alliance Scale $12,367.50 Caruso said that staff’s original plan had been to recommend award of bid to Alliance Scale from Canton, Massachusetts but he requested that the item be removed and replaced with the recommendation to award the bid to the next lowest bidder, Mettler- Toledo from Georgia. Unfortunately, the Airport had received inaccurate information regarding the reliability and accuracy of the scale bid by Alliance. Caruso provided some background information noting that the Finance Committee had given the Airport approval a few months ago to put a cargo scale out for bid to replace the current scale, which only handles up to 5,000 pounds. The Airport needs one that handles up to 20,000 pounds. Towards the end of December of this year, the Airport will expand its cargo operation for a major cargo carrier and the new cargo scale is required. Six responses were received for the bid request. The lowest bidder technically did meet the qualifications and there were two items that staff researched. One was the reader, which met the specifications. Alliance bid on a scale that could read upwards of 20,000 pounds but put it with two load cells versus the four that the bid specifically required. The two load cells were rated for 10,000 pounds each and, due to its configuration the scale, would not be accurate or reliable for cargo operations. Caruso confirmed this information with the State of Maine Weights and Measures division and they do require scales that are national type evaluation programmed standards. Staff’s recommendation again is to award the bid to Mettler-Toledo, the second lowest bidder, in the amount of $15,684.00. Responding to Bronson, Caruso said that staff did look at the third lowest bidder from Portland, Maine in terms of its proximity and maintenance. Mettler-Toledo has guaranteed reliable and on time service. The scales are required to be calibrated annually. Weston asked about the false information received. Caruso said staff had originally received the information from the lowest bidder. Staff had done research and was contacted by a source late Friday afternoon that recommended that BIA not go with the two load cell system due to its inaccuracy especially for aircraft weight and balance where accuracy is critical. Staff then did further research about the two cell load versus four load cell system. As previously stated, Caruso then confirmed the information with the State of Maine. Responding to Palmer, Caruso said the equipment will enhance the Airport’s cargo handling capability. He would like to see it heavily used. The scale’s lifespan is approximately ten years. Wheeler asked the location of Dacula in Georgia. Bronson asked if another set of scales is available or will the airport be solely dependent upon the new set. Caruso said there is a current scale that only reads up to 5,000 pounds. Barrett noted that Dacula is approximately 20 miles northeast of Atlanta. Responding to Nealley, Caruso said that the annual calibration is an out of pocket expense. Palmer asked if the FAA is satisfied with the equipment. Caruso replied yes so long as the State/Federal standards are in place. Stone asked the true cost over a 5-10 year period in terms of the annual calibration. Caruso indicated he would research Stone’s question and report back to the committee but he noted that due to a time constraint he would need approval to make the purchase from either the Georgia or the Portland, Maine firm. Stone suggested a motion to direct Caruso to research the true costs involved with the annual recalibration letting Caruso make the decision rather than coming back to the Committee. Barrett agreed with the approach of Caruso’s research, build that into the price over a ten-year period and then go with whichever of the two companies has the lowest bid. Blanchette expressed concern with changing the rules in the middle of the process. She feels that the bid process is being undermined and the action would set a poor precedent. A motion was made by Weston to direct Caruso to look at the annual costs of calibration and to make the decision that’s best for the Airport. Nealley seconded the motion. Bronson thought the motion would have contained language that the purchase would not exceed the higher of the prices discussed which is $16,753.60. Weston refined his motion stating that Caruso be given authority to make a decision on the purchase of the cargo scale based on time and need for either the Dacula, Georgia or Portland, Maine firm in an amount not to exceed $16,753.60. The motion was seconded by Nealley. a. Loader – Fleet Maintenance – Beauregard Equipment - $175,695 Dawes said that this item is used in all seasons. Bids were received on a five-year guaranteed buyback which means the City will have the equipment for five years and, at that time, the dealer will buy it back for a total of $92,465. To rent the same piece of equipment would cost $4,000-$4,500 per month. The low bidder was Beauregard Equipment in the amount of $175,695 for a Case Loader. Responding to Gratwick, Dawes said the first five years are the most economical for the dealers in terms of large repairs. In years 5-10, it would extend the instance where it might cost the dealer more money. Responding to Weston, Beauregard did not meet specification because of not being certain they could obtain a coupler, which is ordered from a separate company, and knowing that it would be a week late. A motion was made and seconded to approve staff’s recommendation. b. Update on Pending Bids Dawes spoke about the WIC (Women, Infants, Children at Health and Community Services) wanting to lease a van. WIC is 100% federally funded and the only allowable option for a vehicle is to lease one. The Federal government reimburses the City. The van is up for renewal at the end of December. It is a closed end lease where the City states what it wants for a specified timeframe with specific miles and the low bid is accepted. Caruso spoke about a manlift for BIA. Earlier this year, the Council approved the capital purchase of a manlift in the 2010 budget for $16,000. It would replace the current unit which is a 1987 model. Parts are obsolete. The unit is narrow and unstable at some heights. The new unit would be able to reach in excess of 25 feet which gives the mechanics the greater ability to work on some of the larger aircraft. c. Discussion Regarding Recruitment & Selection of Position of City Manager Stone indicated that Farrar would led this discussion and also noted that at the end of the discussion the Committee will have to decide if it will allocate funds for the RFP process to select a consultant or perform a search in house. He further stated that it was a decision in which the entire Council should participate. Farrar referred to a detailed outline he had prepared of options available for the recruitment and selection of a City Manager. The information was provided with the Committee’s agenda packet. The request for information came forward from both the immediate past Council Chair and the current Council Chair. Farrar outlined the two options. The first is to engage an executive search and recruitment firm to assist in the process. If selected, this firm would include but not be limited to meeting with the Council to help identify a preferred management style, the traits and characteristics desired also known as a recruitment profile, help develop and implement a recruitment plan that would include advertising, networking strategy to aggressively move forward to identify candidates that might not be willing to come forward without the assistance of a third party, pre-screen applicants and identify those who possess the qualities desired, help in the process to narrow that list down and also include assistance in developing questions, rating tools, conducting in depth background reference and previous employment checks, and help to negotiate an employment agreement once a preferred candidate has been identified. The second is that the Council would undertake all of the work involved potentially with some assistance from existing City staff as the Council would deem appropriate. The estimated cost to engage a firm would be $15,000 to $50,000 depending on a number of unknown factors including what the final scope of services would be, where the firm is located, and obviously the number and location of the candidates to be interviewed. Farrar spoke of the advantages and disadvantages of each option. In terms of hiring a firm, it would be a professional neutral firm to help the Council through the myriad of steps necessary to select a new City Manager. When the City Manager vacates his position, it will create a hold on and there will be a considerable workload to be shared among the senior staff in order to carry on those duties. If hired, the firm would enable that work in terms of the selection process to be done such that existing staff would be freed up to carry on the day to day duties. The firm certainly would have the expertise to handle the very critical phase of the process and that would be to undertake the negotiation of the final agreement but more importantly the background reference and previous employment checks. In the packet provided, Farrar had provided a proposed timeline and he reviewed it with the Committee. Farrar spoke about the City vision update as well as the use and composition of a preliminary screening/interview committee. He had been directed to at least place the two items onto the table as there was some interest in using an additional committee to help with the screening process. Farrar distributed examples of a recruitment profile, which would be developed by a recruit firm to assist with the recruitment process. Palmer said it is the City Council that selects a new City Manager and would hope that the City Council would be involved in the process. The City should not exclude or preclude internal candidates for the position and a process is needed by which interested internal candidates can apply for the position. Palmer spoke in favor of an executive search and recruitment firm realizing that it will be expensive. Wheeler felt that a recruitment and search firm should be engaged. He thinks that Option 2 is a dangerous one because of the time involved and the lack of expertise. It will be expensive but much more expensive if left in the hands of a Council that is very part-time and very ill equipped to conduct the search. Nealley agreed with the engagement of an executive search and recruitment firm. He is concerned about the timeframe for the RFP preparation process. Gratwick agreed with the use of an outside firm to assist in a nationwide search. He spoke of the need for assistance for the Council to find its bearings. He thinks that the public expects the Council to set a vision. Whether the position is filled with a local or non-local individual, it is important for that individual to know that he/she was part of a nationwide search. Bronson supported the seeking and hiring of an executive search and recruitment firm. It will not take the Council out of the process. He would like to see the proposed timetable tightened up to move along more quickly. Weston thinks the value of hiring an outside firm comes from what happens after the applicants come in and he agrees that it is not a process that the Council should shoulder itself. The Council does need to be as involved as possible and question that the City Council is ready to define what it wants. He feels that the Council has a lack of vision and lack of knowledge as to what that next person should be. He warned those in attendance that the Council should spend more time talking about exactly where the City is going and what it is going to be before bringing in a captain. He did support the notion of going with an external firm. Hawes felt that an outside firm is needed but the Council must be engaged at every step of the way. As for the vision, she said that in part it is already there but it’s not been solidified among the nine Council members. She stressed that it should not stop seeking firms to start the recruitment process. She stated that a firm definitely needs to be hired. Having been on the Council when the current Manager was hired and an executive search firm was engaged, Blanchette assured the Council that they will definitely be involved every step of the way. It will not be an easy job and it will be time consuming but the Council needs to be willing to put in the time. Blanchette definitely agreed with an outside firm. She stressed that the Council needs to decide what it wants. Palmer said that he feels the Council already has a sense of where it is going and are already on that path. It does need to be fine-tuned. Farrar again discussed the proposed timeline noting that he had reworked the proposed schedule several times to get it to its present form. The only way to tighten it up would be if the Finance Committee did not want to review the Draft RFP but he did not suggest that approach. Wheeler said he is comfortable with the timeframe proposed. 3. Discussion of Use of Facilitator for Visioning Session Stone noted that the visioning process needs to run in parallel with the RFP process of an executive search firm. Gratwick felt it appropriate to have an outside facilitator assist with a difficult and thus far unclear part of Bangor’s future. He thought it would be of assistance for each Councilor to put their vision in writing for discussion and review by the entire Council. Nealley said that facilitators have a tendency to look for compromise and consensus. It is the majority of the Council’s vision that should move forward. A facilitator needs to understand the nature of the Council body. Wheeler said his initial reaction had been not to have a facilitator but he now would be comfortable with a good facilitator. He agreed with Nealley’s comments that it is the full Council’s vision and it is the collective vision of the Council. Palmer said he had no issue with or without a facilitator. He recommended that the Council pick up on last year’s discussion at Hollywood Slots as a guide. There was a vision 365 days ago and it would be good to look at it to see what has been missed. He agreed with Wheeler that it will take all nine Councilors in the process. Blanchette said that if the majority rules in favor of a facilitator she is okay with that decision. Hawes had a different view. She feels that the Council as a whole is more than capable of having their own meeting with nine individuals sitting around the table and being able to discuss what their vision is, their hopes, and their future values are for the City. The Council Chair could moderate such a meeting. Weston noted that in his professional life he deals with facilitators on a weekly basis and agreed with Hawes. The facilitator itself is not going to deliver anything other than the expectations put to that individual in the beginning. If a facilitator is handed clear expectations, instructions and the definition of what the day will incur, it would be helpful in leading the direction but not so much in directing the topics of discussion. He said he would be in favor of either having a facilitator or not. Bronson said he could go either with or without a facilitator. He would like to see the end product be the will of the nine people. He would want a facilitator that is very transparent. What the Council does should not be in any way shaped by the facilitator. Wheeler said that he is beginning to think that the vision can be done without a facilitator with one significant caveat – it cannot be done in one day, one session. A vision statement is one of the most significant and expected action of the Council. He recommended three sessions without a facilitator. If at the end of the three sessions a consensus hasn’t been reached, then maybe outside help is needed. Wheeler felt that the Council had arrived at clear objectives last year and, within 60 days, they had faded. Gratwick said the end result is the need for a written product to be used in brochures, provide to the press, etc. He agreed with Wheeler that this is something that needs to be discussed over a period of time, not in one day or setting. Gratwick felt it helpful for outside assistance with the Council providing direction. Nealley noted that if all nine Councilors reach a consensus it is not representing the citizens at large. He has wanted change for quite some time in regard to the paradigm of economic development and growth but a lot of citizens to do not support it. It’s their opinion and position. He hopes the Council comes out of this with a majority consensus on vision and direction. He does not want uni-think. Weston said there might be parallel conversations about annual goals or tasks to achieve and a collective vision. The current vision reads more as a definition of a city rather than a vision of where it needs to go. Weston said the short term gains of what is to be accomplished in the next year is not a vision statement. It is something that stands the test of time because of the thought and process put into it. There needs to be a collective umbrella vision that replaces the current vision statement, which is basically a definition of the City, and leaves it with a much more dynamic evolution that drives the Council to do what it does for all citizens. Bronson said that there may be some differences from last year’s session. If the current nine are to produce a vision statement of where to take Bangor, it is different than last year’s session. He thinks there should be philosophical discussion and debate but he strongly hoped that at the end of the exercise the Council has a vision that a substantial majority supports. In response to Stone, Barrett said it is very difficult for a group to self-facilitate. If, for example, the Council Chair were to facilitate, that individual would need to stand back from the discussion. It is important that the Council clearly define what it wants to accomplish. Last year’s process, in his opinion, was not helpful to staff. It produced a laundry list, which was included in the Council’s Orientation Manual. He recommended an outside facilitator for the Council without staff. Stone asked for recommendation. Barrett mentioned Jonathan Reitman and Jeff Wahlstrom. Palmer said it would be good to televise the planning process and make it available for public attendance. Blanchette spoke about televising a meeting at which the Council is attempting to craft a vision. The Council as a body never gets to spend time talking to each other. Sometimes disagreement brings out the best in both parties. She wasn’t certain she would feel comfortable doing so on camera. Palmer still felt the session should be televised. Stone said the Committee would be voting on whether or not to fund a facilitator. Secondly, Stone did not support televising the session. Gratwick said it needs to be a discussion among all nine Councilors and to exclude the Council Chair, if he were to facilitate a session, would be unfair. Bronson said he is convinced that a facilitator is needed. He felt that the session should not be televised. Stone asked if it could be in executive session. Barrett said it cannot be an executive session. Stone asked for a show of hands of those who would support funding for an outside facilitator. Barrett said there is approximately $2,000 in the Council budget set aside for the annual strategic session. The cost for the session will depend on the length involved. Wheeler suggested polling the Council again and to include that the Council’s desire or lack thereof for a multi-session process. Responding to Hawes, Stone clarified that $2,000 has been set aside for the annual retreat but it doesn’t mean that it can’t be used elsewhere. Hawes asked if there would be vision session and then a planning session in addition. Stone said it was open for future discussion. Wheeler suggested a three day session: the first with a facilitator, the second without a facilitator, and the third with a facilitator to refine all of the ideas that had come forward in the first two sessions. Stone felt that as the Council steps into it the process will become clearer in terms of sessions. Weston agreed with Palmer that this issue has been of great interest to the public and in the interest of transparency it is important to decide if or what funds are used and to know where it is coming from before knowing whether to support it or not. Stone said the $2,000 was budgeted for a retreat. He felt this session is more important than the budget retreat. Again Stone asked for a show of hands in support of an outside facilitator. Stone said the outside facilitator carries with Councilors Blanchette and Hawes in opposition. Stone asked Barrett to provide names and suggestions to him for facilitators. Responding to Stone, Farrar suggested that when the executive search and recruitment firm is hired and meets with the City to put a RFP together, it would be appropriate for the vision to be ready at that point. Palmer suggested Doug Hall at the University of Maine be considered as a facilitator. 4. Discussion of Section 511 of the Tax Increase Prevention and Reconciliation Act Little discussed a Council Resolve which would call upon our Congressional Delegation to support repeal of Section 511 of the Tax Increase Prevention and Reconciliation Act. This section of the Act requires any Federal, State, or local government that makes annual payments for goods and services in excess of $100M to withhold 3% from those payments and remit that withholding to the IRS. This poses a number of significant problems for the City and its vendors. The current payables software is not capable of tracking such withholding. To do so, the City will either have to upgrade its software at a potentially significant cost or devote considerable staff time to manual tracking. Vendors will also be impacted because it is unlikely that their accounting systems will recognize this withholding, resulting in overdue notices based on the 3% discrepancy between what they bill and what the City pays. This will result in both confusion and additional cost to both vendors and the City. It will create a particular hardship for smaller local businesses that may experience cash flow issues that would negatively impact their ability to do business with the City. This proposal unfairly targets only those who do business with government. As a result, the City anticipates that some vendors will either increase their pricing to offset the withholding requirement or cease doing business with governments, thus limiting competition and increasing costs. Proposals have been introduced in the House and Senate that would repeal Section 511 which is now scheduled to go into effect on January 1, 2012. This Resolve seeks the support of our Congressional Delegation in repealing Section 511. A motion was made and seconded to approve staff’s recommendation.