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HomeMy WebLinkAboutCity Council Committees - Operations - 10/23/1990 OPERATIONS COMMITTEE MINUTES October 23, 1990 COUNCIL MEMBERS PRESENT: Jon Johnson Paul Mann STAFF PRESENT: Dennis Byerly Ed Chow Dea Drake Charlie Lindsey Roger Lubovich Tony McCarthy Kelli O'Donnell Don Wickstrom MEMBERS OF THE PUBLIC: Richard King The meeting was called to order at 4:35 pm by Acting Chairperson Paul Mann. APPROVAL OF VOUCHERS All claims for the period ending September 30, 1990 in the amount of$816,531.84 were approved for payment. All claims for the period ending October 15, 1990 in the amount of $2,416,144.44 were approved for payment. JOINT RESERVOIR EOUITY PURCHASE Public Works Director Wickstrom outlined the history of the joint reservoir owned by the City of Kent and Water District 111. Water District 111 is in need of storage for secondary water reserves which cannot be combined with the City's water supply. Consequently, the Water District is requesting that the City purchase their share of the reservoir which would enable them to build a new storage reservoir. The Joint Use Reservoir was constructed and financed jointly by Kent and Water District 111. The City owns 53% currently and shares the maintenance cost. The purchase of the Water District's share would be$608,780.38 in 1990 dollars. Funding for this purchase has been included in Public Works 1991 Capital Improvement budget request. Public Works Director Wickstrom requested authorization to execute a letter of agreement with the Water District in 1991. The letter of understanding would allow them two years to convert off of the joint reservoir to their own. Committeemember Johnson asked if they currently had property for such a reservoir. Public Works Director Wickstrom replied they did not currently have property, but they would have the funds if we purchased their share. It would also be cost effective to allow them to use some of the City's property because of the simplification of a one owner system. Finance Director McCarthy asked if the full amount of purchase was in the 1991 budget. Public Works Director Wickstrom noted that$100,000 was budgeted for 1991. Finance Director McCarthy suggested that it may be in the City's best interest to pay for the full amount out of the Water Fund instead of paying interest. Committeemember Johnson moved that the letter of agreement should be executed requesting that Finance Director McCarthy analyze whether the full purchase price should be paid in full or financed. The motion was seconded by Committeemember Mann. The motion carried with a vote of 2-0. AWARD OF LAUNDRY SERVICES CONTRACT Customer Services Manager Lindsey requested the Operations Committee approve his recommendation to award the laundry services contract to American Linen. Quotations were solicited from five companies. The lowest bid was from Aratex who is the City's current supplier. There have been a number of issues with Aratex during the past contract regarding the quality of service which were not addressed by the vendor to the City's satisfaction. American Linen's references all rated them high for customer satisfaction which included the State of Washington. Customer Services Manager recommended they be awarded the contract since a higher level of service and more responsiveness would offset the higher costs since it would require less City staff time. Committeemember Johnson moved that approval of the contract should be recommended to the City Council. Committeemember Mann seconded the motion. The motion passed with a vote of 2-0. SR. HOUSING BOND ISSUANCE Finance Director McCarthy introduced Richard King of Lehman Brothers to the Committee. Finance Director McCarthy noted that it was important that the Senior Housing Bonds were not issued until a definitive plan was in place. Recent information to the Council has laid out a plan which now indicates it is time to move forward with issuance. Over the past six months he had been researching whether to go with a competitive sale versus a negotiated sale. This question was brought to the Internal Budget Committee. The two major questions were raised: What will interest rates do? What will happen in the mid-East? Because of the current instability, the IBC felt a negotiated sale would provide more flexibility. At the November 6th Council meeting the Lehman Brothers Bond Purchase Proposal will be presented. Currently it is estimated by Lehman Brothers that the 20 year Housing bonds will be approximately 7.6%. Richard King outlined interest rates over the past ten years noting that in 1980 a ten year bond was at 14.5%. Lehman Brothers will present the official statement to the City Council on November 6th. Committeemember Johnson asked if slowness in spending bonds in the past had an effect on the bond rate. Richard King stated that it did not but put a managerial burden on Finance Director McCarthy and his staff because of the tax exempt rates. This was an information item only and will be presented at the Council meeting under Other Business. REQUESTED UTILITY ADJUSTMENT FOR KENT MEADOWS Customer Services Manager Lindsey requested that this item be removed from the agenda since Eric Schwabe was not present. Finance Director McCarthy reviewed the letter sent by Mr. Schwabe on behalf of Kent Meadows noting that the water was definitely used. Committeemember Johnson stated that Mr. Schwabe was welcome to bring the bill to the committee but, from the facts stated in the letter, the adjustment would be denied. It is the property owners responsibility to properly maintain the facilities. Committeemember Mann asked if there was a policy in place for these requests. Finance Director McCarthy stated there were six or seven steps before a request for adjustment is brought to Committee. DAYCARE COMMITTEE REPORT Daycare Committee Chairperson Drake presented the findings of the Daycare Committee to the Operations Committee members. She noted that the report had been compiled under the assumption that it would be a City sponsored, fee supported (users pay for facilities) daycare. Based on the information available it was found that such a daycare would provide substantial benefits for both the City and employees. A survey sent to all permanent employees had a return rate of 31%. Compilation of the returns showed a definite interest by employees both with and without children. The Daycare Committee also felt that if larger daycares could run for a profit the City should be able to break even. The Committee did not have the expertise to determine exact costs and recommended a professional study to determine costs. Finance Director McCarthy added that a study could determine what the bottom line would be, identify site, possibility of remodeling, etc. In addition, the City's current liability insurance would cover such a daycare with only a slight rate increase. The Internal Budget Committee felt a better assessment of the dollars necessary was needed as well as more analysis of the number of employees which would utilize the facility to determine how high the fee schedule would be. This information would be helpful to determine if the City would want to subsidize, the possibility of renting, and/or the feasibility of such a daycare. All of these questions could be addressed in a feasibility study as well as alternatives and Internal Revenue Service regulations. Committeemember Johnson concurred that affordability to employees would be a major factor. Daycare Committee Chairperson Drake pointed out that employees were not expecting reduced rates as much as quality and a say in their children's program through an advisory board. Committeemember Mann asked if other municipalities had such a daycare. Seattle, Washington State, and the Kingdome currently have various daycare programs. In addition,the Dependant Care Reimbursement Program could be utilized which exempts dollars spent on childcare and adult dependant care from FICA for both the employer and employee. Committeemember Johnson motioned to recommend funding of$7,500 for the Daycare Feasibility Study. Committeemember Mann seconded the motion. The motion passed with a vote of 2-0. r.orrection Facility Manager Byerly asked if such a daycare were started would this effect nggotiations for the Union. Daycare Committee Chairperson Drake replied that if the daycare were user supported as foreseen it would not be a benefit. It would be similar to the Wellness Committee which is voluntary participation. The need for 24 hour childcare was also addressed by James Miller who surveyed local daycare facilities to see if they would be willing to set up a program. He received no response. The number of employees who would utilize such a service would determine if it would be feasible. HEALTH SERVICES STUDY Assistant City Administrator Hansen was not present to present the Health Services Study. Finance Director McCarthy stated that King County annual contract fee with Kent increased 21% this year. Officials from Auburn and Federal Way had approached Kent concerning our interest in participating in a study of health services provided by King County. The proposal is to request approximately $7,500 from each city in south King County and retain a consultant to examine a number of common issues. The Internal Budget Committee has reviewed this issue and recommends the appropriation of$7,500 in the 1991 budget for this study. Committeemember Johnson made a motion to add this item to the 1991 budget. The motion was seconded and passed with a vote of 2-0. The meeting was adjourned at 5:20 p.m. by Acting Chairperson Mann.