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HomeMy WebLinkAbout09-05-01 Personnel & Finance tommgttte pout: ikrisoratel anti finattre (ommttt*e. The September 5,2001 meeting of the Personnel and Finance Committee was called to order by its Chairperson, Council Member James Aranowski at 3:01 p.m. in the Council Informal Meeting Room. Persons in attendance included Council Members Aranowski, Varner, Coleman, and White; Mayor Stephen J. Luecke, Public Works Director Gary Gilot, City Engineer Carl Littrell, Director of Central Services Matt Chlebowski, Fiscal Officer Joe Kuzmits, Director of the Division of Environmental Services John J. Dillon, Director of Bureau of Sewers and Streets Sam Hensley, Director of Budgeting & Financial Reporting Tom Skarbek, Director of the Bureau of Water Works John Stancati, Utilities Finance Director Rozanne Hayden, Dave Sypniewski and Kathleen Cekanski-Farrand, Council Attorney. Council Member Aranowski welcomed everyone to the Committee meeting and called for a presentation on the proposed 2002 budget for Public Works. Mr. Gary Gilot, Director of Public Works, provided an overview of the public works operations. Mr. Gilot noted that his first 1 1/2 years have been challenging. Mr. Gilot noted that there are approximately 400 people who work in Public Works. The # 1 problem is the lack of resources for streets in light of the drop in revenue from the local road and street funds. He suggested that the City lobby in Indianapolis to address the local road and street allocations. Council Member Coleman noted that the Council will have its quarterly meeting with the State Senators and State Representatives and that this revenue concern could be addressed at that venue. Mr. Gilot noted that Michigan increased its gas tax by 3-4 cents. Streets are rated on a ten (10) point system and Mr. Gilot's goal is to maintain city streets at a"7"or above. Mayor Luecke stated that reassessment will also complicate this situation, as well as the loss of state cash reserves. The Mayor is a member of the"Metro Mayors"and have lobbied for additional road and street monies. 2002 Engineering Division Budget (General Fund # 101-0602) 2001 Budget: $ 6,951,575 Expenditure increase, excluding capital: 5.4 % 2002 Budget: $ 6,825,708 Total Expenditure increase: $ 351,593 City Engineer Carl Littrell then summarized the information provided in the footnotes on the "Summary of Major Changes" sheet. Mr. Littrell noted that the City has already realized savings from monies allocated for consulting services by the hiring of an in-house engineer. This engineer is being used on CDBG projects. With the retirement of Joseph Doran, that part-time position has been eliminated. Mr. Littrell stated that the Traffic and Lighting Division has been transferred to the Street Department. The budget reflects an 18%increase of the actual current expenditure level of hydrant cost. The budget also reflects an increase of$ 85,000 due to the costs of gas and electricity for the top three (3) floors of the County-City Building, which is based on an estimate from the County Auditor. Personnel and Finance Committee September 5, 2001 Page 2 The construction on the Public Works Service Center is approximately three (3) weeks behind due to unexpected environmental delays. During the course of construction, five (5) underground storage tanks were located. Mr. Littrell noted that the City has negotiated with AEP and that the new electrical service will be underground by the MSF and new Public Works Service Center. It is hoped that occupancy of the new building will be during the 3rd week of October as opposed to October 1st. 2002 Motor Vehicle Highway-Street Division Budget (General Fund # 202) 2001 Budget: $ 3,571,479 Expenditure increase,excluding capital: 64.1 % 2002 Budget: $ 5,859,768 Total Expenditure increase: $ 2,288.289 Director of Bureau of Sewers and Streets Sam Hensley highlighted major changes on the "Summary Sheet" for the proposed budget. The budget reflects the transfer of the Traffic and Lighting Division to the Street Department as reflected in the $ 2,157,820 line item transfer..Mr. Hensley stated that the transfer of traffic and lighting is"a natural". The 2001 projected expenditures are $ 274,592 over budget; and the 2002 budget deficit is projected at$676,606. In light of the MVH cash balance the projected MVH Fund cash balance as of December 31, 2001 is to be $ 167,960. The proposed thermal plastics should last 5-7 years. Mr. Hensley noted that the city is broken into quadrants which may cost more in the short-run but will save the city monies in the long-run. There is a projected $ 30,000 savings in overtime anticipated. Mr. Hensley stressed the need for more monies for streets. Council Member White noted that Mr. Gilot mentioned that the City of South Bend is striving for a rating of"7"for its streets. She inquired what percent of our city streets are at this level. Mr. Hensley noted that the city has five hundred (500) centerline miles and 2,200 lane miles which equals 2,400 segments. The lowest rating of the City's streets would be a rating of 5.1; with at least 30-40%o more needed in funds to rehab. Mr. Hensley stated that he would be able to give more detailed information in the Spring of 2002. Mr. Hensley stressed that the lower the rating of the City streets the more money it will take to improve them. Mr. Gilot stated that guidelines with the use of video tapes are being used to remove human bias during the evaluation process of the city street system. Council Member Coleman inquired about seasonal activities. Mr. Hensley stated that approximately 200 city blocks are addressed each summer. In September the leaf program gets underway, with targeted dates being October 22nd to Thanksgiving. December 1st begins the snow operations programs. There is ongoing alley work, crack sealing. He noted that there are two (2) types of street sealing one which uses liquid in winter and emulsion in the Summer. Grading takes place when weather permits. The City is also using an AMZ patcher which pulls behind a trailer. It is being rented for a 2-month period. Mr. Hensley noted that the City recently had a good media presentation on the new street sweepers. There is one operating in each quadrant which should bring better accountability. Two (2) sweepers are used at night, one on the east side and one on the west side addressing the Personnel and Finance Committee September 5, 2001 Page 3 downtown and all major thoroughfares. The decibel levels are low on the new sweepers therefore allowing night-time operations. Prior to the new purchase, the city had ten (10) sweepers. The old sweepers had a 2.5 hopper capacity; and the new sweepers have a 7.5 hopper capacity. In response to a question from Council Member Coleman, crack sealing lasts between 2-3 years and approximately eight hundred(800) blocks per year are crack sealed. Dave Sypniewski questioned whether the City would use street sweepers in a similar manner as snow route operations. Mr. Hensley stated that this concept is under consideration. 2002 Project Releaf Budget (Fund # 655) 2001 Revenue Budget: $ 160,500 Expenditure increase, excluding capital: 4,5 % 2002 Revenue Budget: $ 154,440 Total Expenditure increase: $4,522 Mr. Hensley noted that the City would hire twenty (20) part-time employees for the first week of operation of Project Releaf, and then hire twenty (20) part-time employees at a later point of the operation. The City of South Bend will be visiting the City of Elkhart to see a bailor-type operation for leaf pick-up. Mr. Gilot noted that the city needs staging areas for the more than 85,000 cubic feet of leaves. The City is considering a quadrant deployment and other new ideas. Dr. Varner inquired about mulching, and was advised that mulching takes place currently. 2002 Water Works Operations (Fund # 620) 2001 Budget: $ 7,518,165 Expenditure increase •: 6.5 % 2002 Budget: $ 8,006,216 Total Expenditure increase: $ 488,051 2002 Water Works Capital (Fund # 622) 2001 Budget: $ 13,654,676 Expenditure increase : 10% 2002 Budget: $ 11,323,469 Total Expenditure increase: $ 1,031,653 2002 Water Works Sinking Fund (Fund # 625) 2001 Budget: $ 2,773,421 Expenditure increase : 19.6 % 2002 Budget: $ 3,317,253 Total Expenditure increase: $ 543,602 Director of the Bureau of Water Works John Stancati noted that the Water Works budgets were prepared by Utilities Finance Director Rozanne Hayden. They noted that the proposed budget reflects a proposed overall rate increase of eighteen percent (18 %) which should provide a net fourteen percent (14 %) increase. Mr. Stancati noted that the City has begun using "radio reads", however it will take 5-8 years for this program to be totally in place. They plan to reduce the workforce by four(4)individuals with such reduction taking place by attrition. Personnel and Finance Committee September 5, 2001 Page 4 2002 Water Repair/Insurance Fund (Fund # 644) 2001 Budget: $ 779,929 Expenditure increase 22.2% 2002 Budget: $ 656,182 Total Expenditure increase: $ 119,253 Mr. Stancati stated that in 2000 an interfund transfer was needed to cover a cash short-fall, which should be repaid in 2001. He noted however that due to continued cash flow problems, another loan will be necessary at the end of this year to avoid a negative cash balance. A loan of$ 125,000 is anticipated to take place from the Water Works Capital Fund # 622 which would be repaid in 2002. Mr. Stancati anticipates that the monthly rate charge for water repair/insurance will be increased from $ 1.15 to $ 1.50. Mr. Stancati noted that the number of breaks in service lines have increased. Mr. Stancati also noted that Dr. Varner's concept of having varying deductible amounts is being considered. Dr. Varner inquired whether the "opt out" option is being considered, and was advised that it was not. At this stage, Council Member Kelly joined the meeting. 2002 Sewer Repair/Insurance Fund (Fund # 640) 2001 Budget: $ 520,220 Expenditure increase 14.5% 2002 Budget: $ 595,393 Total Expenditure increase: $ 75,173 Director of the Division of Environmental Services John J. Dillon noted that the number and average cost of sewer repairs have increased significantly during 2001. He noted the following statistics: 1998 129 repairs @ $ 1,872 average 1999 170 repairs @ $ 1,841 average 2000 209 repairs @ $ 2,444 average 2001 240 repairs @ $ 2,473 projected Mr. Dillon noted that the projected 2001 revenue shortfall is $ 191,858 and the 2002 projected revenue shortfall is $ 114,673.00. Dr. Varner inquired how many different contractors are being used for this program. Mr. Dillon said"about 6", noting that bonding for contractors is a problem. He has periodic meetings with all contractors and they review overall guidelines. Council Member Kelly inquired if the age of the sewer system is a contributing factor,and inquired about storm & sanitary systems vs. Combined systems. Council Member Kelly noted that problems in his neighborhood and Councilmanic District continue. Mr. Dillon stated that problems have occurred throughout the City, with the older houses being more susceptible. He noted that lots with more trees typically have more problems unless the Personnel and Finance Committee September 5, 2001 Page 5 laterals are well maintained. New technology is being used in the Riverpark area on an experimental basis. 2002 Sewage Operation Expenditures (Fund # 641-0621) 2001 Budget: $ 2,580,255 Expenditure increase 7.5% 2002 Budget: $ 2,773,833 Total Expenditure increase: $ 193,578 2002 Wastewater Operation Expenditures (Fund # 641-0630) 2001 Budget: $ 6,772,584 Expenditure increase • 16.6% 2002 Budget: $ 7,895,755 Total Expenditure increase: $ 1,123,171 2002 Sewage Works Capital Fund (Fund # 642) 2001 Budget: $ 2,670,194 2002 Budget: $ 2,708,311 2002 Sewage Works Sinking Fund (Fund # 641-0621) 2001 Budget: $ 2,580,255 Expenditure increase 7.5% 2002 Budget: $ 2,773,833 Total Expenditure increase: $ 193,578 Mr. Dillon noted that these funds address two (2) basic operations: sewage operation and wastewater operation. With the new upgrades, the City should save $ 100,000 in fuel per year. By the end of this year, Mr. Dillon hopes to get a permit to look at CSO's and mitigate and improve the water quality in the St. Joseph River. The cost is estimated at $ 80 to $ 100 million over a twenty(20) year period. Mr. Dillon noted that rate increases may be necessary next year in light of the costs and service studies. In response to a question from Council Member Coleman,Mr. Dillon stated that the City borrowed from the State of Indiana $ 20 million at 0 % for the first two (2) years and three percent (3 %) thereafter in interest which was used for the headworks building and other upgrades including remote monitoring cameras, clarifiers,engine projects, air flow controls, etc. 2002 Solid Waste Operating Fund (Fund # 610) 2001 Budget: $ 3,863,468 Expenditure increase 0.9% 2002 Budget: $ 3,898,972 Total Expenditure increase: $ 35,504 2002 Solid Waste Depreciation Fund (Fund # 611) 2001 Budget: $ 4,131,194 Expenditure increase 0.3% 2002 Budget: $ 4,050,814 Total Expenditure increase: $ 11,420 • Personnel and Finance Committee September 5, 2001 Page 6 Mr. Dillon stated that Solid Waste has approximately 36,000 customers of which 7,200 are seniors. Rates are $ 8.00 with seniors being charged $ 5.50. There are ten (10) residential routes currently which will be reduced to nine (9) routes. Solid Waste utilizes an "incentive program" which permits employees to go home as soon as they complete their route. A pilot program utilizing nine (90) gallon containers with lids is underway in one (1) area of the city without a strong neighborhood group and the other in an area with a strong neighborhood group in place. They are considering going from a four(4) day work week to a five(5) day work week. The projected Solid Waste Fund cash balance as of 12-31-01 is$ 588,358. Mayor Luecke noted that special pick-ups continue. Code currently uses a five (5) day compliance letter, then takes a picture and then sends out the clean-up crew. Approximately one (1) month ago a new system was implemented with items to be picked up by Jack Dillon's employees in at least five (5) working days. Dr. Varner suggested that a two(2) working day period be the goal. 2002 Central Services-Equipment Services (Fund # 222-0605) 2001 Budget: $ 2,214,581 Expenditure increase • 4.6% 2002 Budget: $ 2,317,371 Total Expenditure increase: $ 102,790 Fiscal Officer Joe Kuzmits was then introduced by Director of Central Services Matt Chlebowski. He reviewed the information contained in the footnotes on the "Summary" page. He noted that labor rates were established in 1994 and new labor rates are proposed as follows: From $44 to$46 From $42 to$ 44 From $32 to$34 Council Member Varner inquired about the preventive maintenance costs since it was his understanding that the police vehicles were being sent to places like Insty Lube for at a cost of$ 25 to$30 and then being charged at the City rates. Mr. Chlebowski denied that such action had taken place and stated that all police vehicles have been worked on in-house for such preventive maintenance checks. Tom Skarbek noted that savings are realized by the City since the Central Services operations performs services in the middle of the night. 2002 Central Services-Central Stores (Fund # 222-0612) 2001 Budget: $ 109,947 Expenditure increase 4.3% 2002 Budget: $ 114,643 Total Expenditure increase: $ 4,696 Mr. Chlebowski noted that there has been a consolidation of Central Services postage cost which is reflected in the proposed budget. s ` Personnel and Finance Committee September 5, 2001 Page 7 2002 Central Services-Print Shop (Fund # 222-0613) • 2001 Budget: $ 159,133 Expenditure increase 2002 Budget: $ 164,585 Total Expenditure increase: $ 5,452 $ 5,452 Mr. Chlebowski noted that he anticipates an increase in the volume of printing and therefore the budget should be in the black. Dr. Varner inquired whether the Print Shop could receive information by disc and email, and he was advised that it can. Approximately 45 % of the revenue comes from printing forms for the South Bend Police Department. 2002 Central Services-Radio Shop (Fund # 222-0614) 2001 Budget: $ 229,455 Expenditure increase 2002 Budget: $ 239,839 Total Expenditure increase: $ 10, $ 10,384 Mr. Chlebowski stated that the Radio Shop is now doing repairs for the Sheriff's Department, the St. Joseph County Highway Department, as well as the North Liberty and Roseland police departments. Council Member Aranowski thanked everyone for their presentations, and then adjourned the meeting at 4:50 p.m. Respectfully submitted, Council Member James Aranowski, Chairperson Personnel and Finance Committee KCF:kmf