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HomeMy WebLinkAboutCity Council Committees - Operations Committee - 11/07/2017Operations Committee Minutes Approved November 21, 2017 Page 1 of 5 Date: November 7, 2017 Time: 4:00 p.m. Place: Chambers East Attending: Bill Boyce, Les Thomas and Dana Ralph, Chair Agenda: 1. Call to Order. 2. Roll Call. 3. Changes to the Agenda. There were no changes to the agenda. 4. Approval of Check Summary Reports dated 10/1/2017 thru 10/15/2017. L. Thomas moved to approve the check summary report dated 10/1/2017 thru 10/15/2017. B. Boyce seconded the motion, which passed 3-0. 5. Approval of Meeting Minutes dated October 17, 2017. B. Boyce moved to approve the Operations Committee meeting minutes dated October 17, 2017. L. Thomas seconded the motion, which passed 3-0. 6. Emergency Management Performance Grant - Recommend. Emergency Management Division Chief John Madson and Emergency Management Specialist Jenny Keizer asked members to move forward the acceptance of the annual emergency management performance grant. The $70,697 grant was awarded by the Washington Military Department’s Emergency Management Division and the U.S. Department of Homeland Security. It is required that activities conducted using grant funds should have a direct relation to five elements of emergency management, they are: prevention, protection, response, recovery, and mitigation. Any incurred costs will be paid by the Puget Sound Regional Fire Authority Operating budget and reimbursed by the State. L. Thomas moved to recommend Council authorize the Mayor to accept and sign the Emergency Management Performance Grant from the Washington Military Department/Emergency Management Division and the U.S. Department of Homeland Security, in the amount of $70,697, sign all necessary grant documents and authorize expenditure of the funds in accordance with final grant terms and conditions acceptable to the city attorney. B. Boyce seconded the motion, which passed 3-0. Operations Committee Minutes Approved November 21, 2017 Page 2 of 5 7. Medical, Dental, Vision, Basic Life, Voluntary Life, and Long Term Disability Insurance Vendor Contracts – Recommend. Human Resources (HR) Benefits Manager Laura Horea and Risk Manager Chris Hills asked members to authorize the renewal for: 1) medical, dental, and vision insurance, and 2) Basic Life and Accidental Death & Dismemberment (AD&D), Voluntary Life and Long Term Disability insurance. As part of the renewal process, the HR Benefits Division conducted two separate requests for proposals between April and August 2017, bids were collected by both current and non-current providers. Current providers, Premera, Delta Dental, and VSP are each recommended to renew for an additional three-year contract and Kaiser Permanente (formerly Group Health) for a one-year renewal. This recommendation is based on the strength of their plans, overall costs, customer service, discounts, and overall administration and billing accuracy. The second recommendation is to move from current vendor, Standard Insurance, to Cigna for long-term disability services, basic life insurance, AD&D, and employee and dependent voluntary life insurance. Reasons for the recommendation involve: $100,000 savings per year for the three-year contract; employee basic life insurance coverage increase from 1 x salary up to $50,000 to $100,000 and; employees will have the opportunity to purchase additional voluntary life insurance for themselves and their family members at a significantly lower rate than the current vendor provides. All bids were reviewed by the HR director, the benefits manager, and discussed with members of the City’s Healthcare Board. B. Boyce moved to recommend Council authorize the Mayor to approve renewal of the City’s contracts for medical, vision, and dental benefits with Premera, Vision Service Plan (VSP), and Delta Dental for three years, and Kaiser Permanente (formerly Group Health) for one year, and to approve switching from Standard Insurance to Cigna for a new 3-year contract for Basic Life, Voluntary Life, and Long Term Disability insurance, subject to approval of final terms and conditions by the Human Resources Director and the City Attorney. L. Thomas seconded the motion, which passed 3-0. 8. Consolidating Budget Adjustment Ordinance for Adjustments between July 1, 2017 and September 30, 2017 - Recommend. Deputy Finance Director Barbara Lopez made a request to move forward the second quarter technical gross budget adjustment ordinance reflecting an overall budget increase of $3,117,760. Of that amount, $1,620,760 was previously approved by Council for the following items: $782,200 Highway Safety Improvement Program Grant for the Valley Signal System Project; $750,000 Transportation Improvement Board grant for South 224th Street Operations Committee Minutes Approved November 21, 2017 Page 3 of 5 Project; $50,000 Commercially Sexually Exploited Children (CSEC) Grant for the CSEC Taskforce Support; $36,560 King County Sheriff Grant for the WASPC Sex Offender Program; $1,000 Police Mini Grant for Heroes & Helpers Program and; $1,000 WASPC grant for safety equipment. Adjustments totaling $1,497,000 have not been previously approved by Council. Of that amount adjustments include: $750,000 transfer from the General Fund to the Health Care/Benefits Fund to cover additional medical claim costs; $300,000 in additional Criminal Justice budget for contracting bed space at other prison facilities; $387,000 for various police equipment, including an evidence tracking system, drying cabinet, firing range baffle support, handgun flashlight/holsters, rifle suppressors, and a utility bucket truck and; $60,000 to increase the marketing budget paid from lodging tax revenues, as approved by the Lodging Tax Advisory Board. L. Thomas moved to recommend Council approve the consolidating budget adjustment ordinance for adjustments made between July 1, 2017 and September 30, 2017, reflecting an overall budget increase of $3,117,760 . B. Boyce seconded the motion, which passed 3-0. 9. Write-offs of Uncollectable Accounts - Recommend. Finance Director Aaron BeMiller made a request to members to write-off uncollectable accounts receivables from 2007 through 2016 in the amount of $150,006.24; of that amount, $28,602.57 is comprised of interest and finance charges. The write-offs represent four percent of $3,751,969.58, the accounts receivable balance as of October 31, 2017. The write-off summary includes:  $3,000 represents unpaid violations and fines;  $9,054.59 is for miscellaneous permits, tax and license fees;  $111,020.83 is for Parks fees and golf operations tenant debt; and  $26,930.82 is comprised of miscellaneous Public Works repairs and services. Clarification was made that the debt still exists and the write-offs do not relieve the obligation and are in collections with Alliance One. B. Boyce moved to recommend Council authorize the Mayor to write-off uncollectable accounts owed to the City in the amount of $150,006.24, subject to final approval of the Finance Director and City Attorney. L. Thomas seconded the motion, which passed 3-0. Operations Committee Minutes Approved November 21, 2017 Page 4 of 5 10. 2017 Refunding of Outstanding 2009 Utility Revenue Bonds - Recommend. Mr. BeMiller was joined by Pacifica Law Group Bond Counsel Deana Gregory to explain the refunding of the City’s 2009 Build America Bonds (Revenue Bonds). The refunding, called a “crossover” refunding, includes the issuance of new Revenue Bonds whereby the cash is deposited in an irrevocable escrow and will be held until December 1, 2019, the date the Build America Bonds (BAB’s) are callable. The “crossover” refunding allows the City to capitalize on both the current low rates in the bond market and BAB’s subsidy paid to the City from the Federal Government. BAB’s are qualified bonds that provide a Federal subsidy through a refundable tax credit on the interest paid by the issuer (the City). The refunding ordinance allows for the designated representative to approve the final refunding as long as the following conditions are met:  The aggregate principal amount of the Bonds does not exceed $16 million,  final maturity date is no later than December 1, 2029,  bonds are sold in the aggregate at a price not less than 97 percent and not greater than 130 percent,  savings associated with the refunding is at least 3 percent, and  The true interest cost for the Bonds does not exceed 3.00 percent. The refunding ordinance requires that the Finance Director provide a report to the Council describing the final terms of the refunding. The authorization in the ordinance extends to June 1, 2018. If the new Revenue Bonds are not sold by that date, additional Council approval will be necessary. The anticipated closing date on the refunding is December 28, 2017. Current estimates (November 2017) on the refunding are a net present value savings between $940,000 and $915,000 on the life of the bonds. L. Thomas moved to recommend council adopt Ordinance No. ________, providing for the issuance of combined utility system revenue refunding bonds in the aggregate principal amount of not to exceed $16,000,000 for the purpose of refunding, on a crossover basis, a portion of the City’s combined utility system revenue bonds series 2009B taxable (Build America Bonds – Direct Payment); providing the form, terms and covenants of the bonds; delegating certain authority to approve the final terms of the bonds; and authorizing other matters related thereto, subject to the approval of final terms by the city’s finance director and city attorney. B. Boyce seconded the motion, which passed 3-0. Operations Committee Minutes Approved November 21, 2017 Page 5 of 5 11. Square Footage Tax Increase – Recommend. Mr. BeMiller brought forward the recommended tax increase that committee members were informed on during the October 17th committee meeting. The doubling of the square footage tax increase would be used for capital purposes. It is estimated that 680 Business and Occupation (B&O) tax paying businesses will be affected, generating approximately $3 million in additional revenue for Parks or other purposes; the original $3 million B&O tax will still be applied towards street capital purposes as it is intended. A request was made to have a comparison of what neighboring cities’ B&O tax rates are. Mr. BeMiller made clear that not all cities that have a B&O tax include the square footage tax rate but will look into the request. Prior to voting, Councilmember Thomas stated he is not supportive and would not vote for the square footage tax increase as that was not the intent when the B&O tax was created. In order to allow the rest of Council to weigh-in, this item will be added to other business on the November 21st council meeting agenda. B. Boyce moved to recommend Council adopt an ordinance amending Chapter 3.28 of the Kent City Code to increase the City’s square footage tax to six cents for warehouse floor space and two cents for other business floor space, and to allocate one -half of the revenue received from the square footage tax to the Capital Resources Fund . D. Ralph seconded the motion, which passed 2-1. 12. Adjournment. The meeting was adjourned at 4:43 p.m. by D. Ralph. J. Hays Jennifer Hays Operations Committee Secretary