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HomeMy WebLinkAbout08-28-03 Personnel & Finance S I tammit part Virrsorungt and, fine= toutittittu The August 28, 2003 meeting of the Personnel and Finance Committee was called to order by its Chairperson, Council Member James Aranowski at 3:30 p.m. in the Council Informal Meeting Room. Persons in attendance included Council Members White, Aranowski, Kuspa, Kirsits, Varner, Kelly and Coleman, Mayor Stephen Luecke, City Controller Rick 011ett, Director of Budgeting & Financial Reporting Tom Skarbek, Fire Chief Luther Taylor, Asst. Chief of Operations Robert Quinn III, Asst. Chief for Services Rick Switalski, Asst. Chief for Inspections & Prevention Howard Buchanon II, Battalion Chief for EMS Randy Magdalinski, Battalion Chief for Special Operations James Lopez, President of Local#362 Ken Marks and other fire union representatives, Studebaker Museum Director Rebecca Bonham, John Farrell, Youth Services Bureau Bonnie Stryker, South Bend Regional Museum of Art Executive Director Susan R. Visser, Jim Cierzniak, Benefits Manager Susan Wallace,and Council Attorney Kathleen Cekanski-Farrand. Council Member Aranowski welcomed everyone to the budget hearings and stated that they would begin with receiving presentations on a series of miscellaneous funds today. 2004 Studebaker Museum 2003 Expenditures $219,010 General Fund # 101.0409 2004 Expenditures $222,932 Studebaker Museum Director Rebecca Bonham made the presentation. She introduced John Farrell, their Treasurer and thanked the Council for their past support. She noted that they have been in a holding patter in light of the proposed move to the corner of Chapin and Thomas. Six(6) entities are involved with the City of South Bend pledging $5 million and the Studebaker Museum pledging $1.5 million. Fund-raising is aimed to raise an additional $3 million. 2004 would begin the design phase. She noted that recently they have had water problems at the museum. They are scaling back on the exhibits and have had increases resulting from the health insurance premium increases. She noted that they may need more money to pay for moving expenses. Dr. Varner requested that the last five (5) years of audited statements, attendance records and available cash be made available as well as an update on the success of pledgesnoting that the last documents provided to the Council were in 1998 or 1999. Mr. Farrell stated that those documents could be provided. Council President White inquired about the moving expenses. Ms. Bonham stated that a"normal" moving expense would be $69,000, however the Indiana State Museum spent $200,000. They anticipate a cost cif ssibte,,J1.Q0_000_ _.Ms Bonhamfurther_noted_that_she_n3av_be_back_Jater_this year on this topic since less admissions may result. Dr. Varner inquired who the six (6) entities were. Ms. Bonham noted that they included the City of South Bend, St. Joseph County, Center for History, South Bend Heritage, the Studebaker Museum and families who own homes in the immediate area. Mr. Farrell noted that the Drivers Club was not a part of the proposed transaction. Ms. Bonham noted that more pledges have been collected from the Drivers Club,a point which Dr. Varner suggested be made known publicly. Mr. Farrell stated that the percentage of contribution from the City of South Bend to the museum was 40% five years ago, and now it is 33% of the revenue. In 2005 the Century Center loan payment will be paid in full. Personnel and Finance Committee August 28, 2003 Page 2 2004 Youth Service Bureau 2003 Expenditures $75,000 General Fund # 101-0407 2004 Expenditures $75,000 Executive Director Bonnie Stryker made the presentation. She noted that the Youth Service Bureau is most appreciative of the ongoing relationship with the City of South Bend. From 1972 to 1985, the Youth Services Bureau was part of City government. Since that time they have operated as a not-for-profit agency with a 19-member Board of Directors. Their overall mission is to help children and youth during critical times. In the past they operated the court appointed special advocate program (CASA) from 1987 to 2002, which was transferred to the Juvenile Court. They had 81 volunteers and had a federal grant. Youth Services Bureau operates the "Youth as Resources Program" for junior and high school students. They work as volunteers who work to fund community service projects. The students raise money for projects, receive donations, and evaluate projects. They have four (4) grants ranging from $50 to $500. In October they will have a"Community Youth Forum on Diversity" for all high school students. It will be held at Calvary Temple. They develop action plans which are they presented to the school boards. They also operate "Safe Station" which act as runaway shelters. They had 121 youth last year who received assistance under this program. "Safe Places" are identified by the large yellow signs posted on the buildings with all Burger Kings, Partnership Centers,Memorial Hospital ER being just some of the locations. They then contact Safe Station so that the issues can be addressed and resolved. Presentations are made to junior and high school students each year,with 5,000 students being reached each year. Bonnie Stryker then reviewed "Young Mom's Self-Sufficiency Program" which assisted 78 mothers and 88 children, with the mothers ranging in age from 16 to 24 years of age. They provide food and shelter assistance and work with each of them on education skills, employment and parenting. Their fiscal year is July to June. 21 mothers have enrolled in academic programs to date. She further noted that they annually help approximately 5,000 youth each year and have outreach programs to approximately 5,100. They also have "Youth Links" where they are trying to get computerized dada to see what needs are being met and what resources can be brought together from such entities as Madison Center, Goodwill, etc. $34,000 needs to be raised for this project. Their overall goal is for cooperation and collaboration. They will be approaching United Way. They will have a help line with them and hope to increase the number of Safe Place locations. Dr. Varner inquired if they are a 501C3 entity and was advised that they are. He requested copies of the Youth Service Bureau's IRS reports for the past two (2) years, noting that he believes that all not-for-profit agencies receiving monies from the city should routinely provide this information. Dr. Varner further noted that it would be important to review such documents in the Council's role of accounting for such dollars and the services provided in return. In response to a question from the Council Attorney, Bonnie Stryker stated that she would provide a break down of the youth assisted showing how many were from the City of South Bend, as well as the County and Mishawaka. She further noted that there were 1,200 referrals made to other agencies last year including to the various township trustees. Council President White inquired about the budget of the Youth Services Bureau. Bonnie Stryker noted that their total budget is $1.2 million with the request to the City being $75,000. She noted that they pursue many grants each year. She further noted that their are many problems involving Personnel and Finance Committee August 28,2003 Page 3 "sofa surfers"who are disconnected. Council President White inquired about the Youth Services Bureau relationship with the various school corporations. Bonnie Stryker stated that they partner with Mishawaka and Penn, for at risk children and have contracts in place with them. They do not have a similar contractual relationship with the South Bend schools. 2004 Museum of Art 2003 Expenditures $125,000 General Fund # 101-0408 2004 Expenditures $125,000 South Bend Regional Museum of Art Executive Director Susan R. Visser provided two (2) handouts to the Council namely the Fall 2003/Winter 2004 SBRMA programming brochure and a 3-page handout entitled "Promising Efforts in 2003/2004" (copies attached). She noted that $65,000 is a rent subsidy which is a direct pass thru to the Century Center for occupancy. $60,000 is the Studebaker debt repayment to pay for the loan which the city provided during the renovation in 1997. Ms. Visser noted that the programming brochure goes out three(3) times per year. They have had flat revenues for two years despite the same demand for programming. Exhibits have been changed quarterly instead of every 4-6 weeks. The programming brochure will be cut back to twice per year. Ms. Visser then reviewed the"Teen Program"and the exhibitions which focus on "Identity" which are addressed in the 2nd handout. She noted that they have partnered with other museums which has resulted in enhanced opportunities for the community. 2004 Fire Department 2003 Expenditures $16,650.997 General Fund # 101-0901 2004 Expenditures $18,007,230 2003 Revenues $2,186,696 2004 Revenues $2,293,856 Fire Chief Luther Taylor welcomed the opportunity to present the proposed 2004 budget for the fire department and noted that his administration staff and representatives of Local #362 were also present. The proposed budget is up approximately $1.3 million dollars. Salaries reflect a 4.1% increase for the 248 sworn firefighters. The budget also includes a 76% increase in health insurance. Personnel costs reflects increases of 9.1% overall when the health insurance costs are included. Supplies have been reduced by 21.7%, and utilities are proposed to be increased by 3.8% to reflect costs for the new fire station which will be in services for the last seven months of next year. Chief Taylor and Asst. Chief Switalski noted that the fire department will bring in revenue of approximately 2.3 million dollars from their EMS contract with St. Joseph County, EMS fees, Neo-Natal services with Memorial Hospital, Critical Care Services with St. Joe Med Center, and service contracts with the University of Notre Dame. As a result of these services and the revenue which they generate the fire department's net budget is reduced to$15.7 million. They noted that of the 248 sworn firefighters one is currently serving in the military and one is currently on family medical leave. They have not budgeted for a full-time maintenance person for the new fire station which should be occupied by July 2004, noting that they are working with Gary Gilot and Sam Hensley on this. They also noted that Memorial Hospital have put several Personnel and Finance Committee August 28, 2003 Page 5 Chief Taylor stated that there were also Homeland Security funds available from the Department of Justice through a grant process, however in light of the matching cost to the city, that they did not apply for such funding. 2004 Fire Department-EMS Capital 2003 Expenditures $297,089 Fund # 288 2004 Expenditures $743,645 2003 Revenues $1,375,805 2004 Revenues $1,404,800 Asst. Fire Chief Switalski noted that this dedicated fund has been in existence since the early 1980's. He noted that it has been a good year with collections up. They are paying down on lease payments and also make an interfund transfer to the General Fund of $250,000 each year. They do not want to do anything that would make individuals not utilize 911 when they need to do so. Overall costs to provide services in this area is$3.6 million. Dr. Varner inquired about the fees charged and whether any adjustments are anticipated. Asst. Chief Switalski stated that the fees were last changed in 2002. The federal government will be reviewing their rates of Medicare reimbursement in October and they will look at our fees thereafter,noting that they are required to review the fees every two(2) years. Chief Taylor stated that they are continuing to pursue a training facility with the major obstacle being the location of a proper site. They will continue pursue this objective and are looking at a fire district. 2004 Liability Insurance 2003 Expenditures $2,326,860 Internal Service Fund # 226 2004 Expenditures $2,271,312 2003 Revenue $2,328,642 2004 Revenue $2,273,454 Council Member Aranowski noted that he would not be present at next Tuesday's Committee meeting and that he has asked Dr. Varner to chair that meeting on the budget. City Controller Rick 011ett noted that Safety&Risk Specialist Keegan Rauen was ill,and therefore he would review this fund. Mr. 011ett stated that loss control fees are going down which is resulting in cost savings. There has been a reduction of workers comp claims, which he credited Mr. Rauen for his services in reducing such claims. He noted that property insurance had gone up 20% last year but it has gone down $50,000 this year.. They are proposing a promotion for Mr. Rauen which will result in a$33,51 salary increase in light of his"aggressive program on safety". 2004 Self-Funded Employee Benefits 2003 Expenditures $7,966,447 Internal Service Fund # 711 2004 Expenditures $11,584,483 City Controller 011ett noted that another presentation to the Council on this topic is planned for September 8th. Expenditures drive this fund. Benefits Manager Susan Wallace noted that the market has corrected somewhat in this area. Personnel and Finance Committee August 28, 2003 Page 6 Council Member Aranowski noted that a $2.4 million additional appropriation has been projected for this year. Mr. 011ett noted that it may be mitigated somewhat and further noted that the budget is based on the first 26 weeks. 2004 Studebaker Bond 2003 Expenditures $658,760 Redevelopment Commission-Fund # 310 2004 Expenditures $661,375 City Controller 011ett noted that the Studebaker Corridor bond matures in 2006. Dr. Varner noted that once it matures it would drop from the tax rolls. Dr. Varner then inquired about the auto excise revenue of$36,902 and the commercial vehicle excise tax revenue of$3,270. Director of Budgeting&Financial Reporting Tom Skarbek stated that such revenue is permitted by the state to pay off this obligation. 2004 Hall of Fame Bond 2003 Expenditures $1,407,400 Redevelopment Commission-Fund # 313 2004 Expenditures $1,407,400 City Controller 011ett noted that this fund reflects the debt service payment with the Hall of Fame bond maturing in 2014. Dr. Varner inquired about the guidelines when revenue falls short. He noted that this fund also utilizes auto excise revenue of$79,263 and commercial vehicle excise tax revenue of$7.022. Mr. Skarbek stated that he would provide additional information to the Council on the permitted usage of auto excise revenue and commercial vehicle excise tax revenue. Mr. Jim Cierzniak of 1156 East Victoria stated that he thought that the Hall of Fame bond was a 17 year bond. Mr. 011ett stated that the original issue was in 1997 and that it was refinanced in 2000. Council Member Kelly noted that the refinancing resulted in a lower interest rate. Dr. Varner inquired whether the refinancing dropped the payment amount or the payment term or both. Mr. 011ett stated that he would check into the details and report back to the Council on this question. 2004 College Football Hall of Fame 2003 Expenditures $810,991 Fund # 310 2004 Expenditures $825,000 City Controller Rick 011ett stated that the two(2) main sources of revenue are the hotel/motel taxes which are projected to be $474,820 for next year and from the professional sports development fund receipts from the NFF which will be$350,000 for next year. Dr. Varner asked why the amount was not capped in light of the increasing revenues. He noted that to the best of his knowledged the NFF did not ask for more monies. Mr. 011ett stated that there is a five-year agreement in place. Mayor Luecke noted that the agreement set minimums. He also noted that despite the increase in the number of hotel/motel rooms that the income is basically the same in light of lower rates and the Personnel and Finance Committee August 28, 2003 Page 7 economy. Council Member Aranowski noted that when the professional sports development fund was created that the sales tax was 5% and now the sales tax is 6%. He stated that the extra 1% should stay with the City of South Bend. Mr. 011ett stated that he would check on this issue and report back. Dr. Varner noted that the city should insist on better reporting from the N1-.F. He noted that the format utilized by Mr. Kish was a much better format and found the one-page report which he finally received just this week (copy attached) embarrassing. He added that the NFF must be accountable and that we should not have to continually ask for such information. Dr. Varner also noted that he has repeatedly requested for a copy of the NFF 501C3 IRS filing, and believes that all not-for-profit agencies should be routinely filing a copy of their forms with the city. He noted that he believes the Council could make this a requirement by ordinance and further added that the Council does have subpoena powers. He further noted that IRS form 990 is a public record. The timeliness is also an issue. Dr. Varner suggested that the city should not sent monies until all information is received. Mr. Cierzniak inquired why the city cannot find out what the salary is of the College Football Hall of Fame Executive Director. He voiced concern in light of the amount of city monies paid to the Hall. He also voiced concern of the"blanket category"of$325,000. Mayor Luecke stated that the city does not require any not-for-profit agency to disclose personnel information. In response to a question from Dr. Varner,the Mayor stated that he does not know whether the city is precluded from receiving such information on not-for-profit information. 2004 County Option Income Tax 2003 Expenditures $12,506,410 Fund # 404 2004 Expenditures TBD in Feb 04 2003 Revenue $6,392,413 2004 Revenue $6,236,716 City Controller Rick 011ett noted that they are in a January/February time frame with $235,000 to $236,000 less revenue anticipated which is related to the economy. He noted that Fort Wayne will experience a double digit percentage decrease in COIT revenues. Council Member Aranowski noted that Indiana has the highest number percentage-wise of sub- chapter S corporations. Mr. Cierzniak stated that on March 8, 1995, Mayor Kernan stated that there would be an accounting of what COIT monies are used for each year. Council Member Aranowski noted that the reports are received and reviewed each February. Mr. Cierzniak stated that COIT appears to have become a "cash cow", which should instead be used for city needs such as in the public safety and public works area vs. "Social welfare spending"such as the$150,000 spent on after school programs. e } Personnel and Finance Committee August 28, 2003. Page 8 Council Member Coleman stated that his recollection was that there would be at least three priority areas and a multitude of uses of the COIT revenues. 2004 Cumulative Capital Dev. Fund 2003 Expenditures $1,072,049 Fund # 406 2004 Expenditures TBD in Feb 04 & $268,532 2003 Revenue $1,066,003 2004 Revenue $1,174,916 City Controller Rick 011ett noted that the tax rate will remain the same at $0.5 per $100 net assessed valuation and has not been reduced as a result of the commercial vehicle excise tax assessment of$14,162. He noted that it would also address computer equipment city-wide. Dr. Varner noted that this fund contains auto excise tax revenue for next year at $56,429 and commercial vehicle excise tax revenue at $14,162. He asked for an explanation. Tom Skarbek stated that he would check into this matter. 2004 Cumulative Capital Imp. Fund 2003 Expenditures $695,270 Fund # 407 2004 Expenditures TBD in Feb 04 & $590,110 2003 Revenue $626,801 2004 Revenue $610,676 City Controller Rick 011ett noted that the sources of revenue were from the cigarette tax distribution,hotel/motel lease payments,and the South Bend Community School Corporation lease payments. He noted that expenditures are for the Century Center bond payments and curb & sidewalk programs under the Good Neighborhoods program. Dr. Varner asked what the amount is which is returned to the General Fund. Mr. 011ett stated that he would check into that. 2004 Economic Development Income Tax Fund 2003 Expenditures $5,334,957 Fund # 408 2004 Expenditures TBD in Feb 04 & $3,363,804 2003 Revenue $3,821,202 2004 Revenue $3,684,634 City Controller Rick 011ett stated that this fund is used for debt service expenditures. Council Member Aranowski reminded the Committee at the next meeting on the budget would be next Tuesday. Respectfully submitted, Council Member James Aranowski, Chairperson Personnel and Finance Committee KCF:kmf Attachments