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LEGISLATIVE COMMITTEE MINUTES

MARCH 10, 2008

Municipal Council of the City of Vermilion

Municipal Complex, 685 Decatur Street, Vermilion, Ohio  44089

In Attendance:  S. Holovacs, F. Ostrander, B. Brady, M. Rossini, H. Strickler, D. Roth, J. Gabriel, G. Fisher, Mayor Anderson, D. Squires, C. Schmidt, B. Kish, C. Howard.  Absent:  W. Hamilton

Call to Order:  J. Gabriel, Chairperson, RESOLVED THAT this Legislative Committee comprised of Heidi Strickler, Vice, and Barb Brady, Member does come to order.

TOPIC ONE:  PRIVATE SEWER LATERAL REGULATIONS AND PROCESSES

D. Squires stated that they were going to discuss how they will address the private lateral issues as they relate to illegal connections of storm water into the sanitary sewers.  He said the first project will be the elimination of the VOL overflow which has to take place by August. 

G. Rigby of Underground Utility Services Inc. presented a power point to council.  He said the purpose of the presentation is to talk about testing and defining abandoned sanitary service laterals.  He said they are trying to establish a process in terms of how to address these.  He said they are also drafting a plan to deal with compliance issues and defining those responsibilities for maintaining sewer laterals.  In the process, they need to start with defining roles and responsibilities which unfortunately are not defined now.  He said to clean the process up they are recommending to install a sewer clean out.  B. Brady asked if the clean out was the responsibility of the homeowner.  G. Rigby said from the clean out to the sewer main it would be the city’s responsibility and from the clean out to the building it would be the property owner’s responsibility.  In his power point he presented results from a WERF survey of various states defining private laterals and the various programs these states put into effect in addressing these laterals.

G. Rigby said the responsibility of maintaining the sewer laterals is defined per the current written policy as follows:

“The City of Vermilion Utilities Department will be responsible for a sewer lateral failure when it occurs under a dedicated paved street or within an existing berm.

To confirm the lateral failure occurs in the area described above it must be done by electronic location.  A licensed plumber or contractor at the homeowner’s expense must do locating.  The Utilities Department will do locating for a fee only when an exposed functioning clean out exists in the yard between the house and the sewer main.  All locating done by a licensed plumber or contractor must be verified and witnessed by Utilities Department employee.

All repairs done by the city to the sewer lateral will include installation of a clean out at the edge of the right of way at the homeowner’s expense.” 

G. Rigby stated that the above policy does not address problems in regards to I/I in either the public or private portion of the sewer lateral.  He provided the city with draft legislation for existing sewer lateral standards/testing, abandoned sewer laterals, and property owner compliance issues.  The proposed legislation must be a part of an overall strategy to eliminate / minimize I/I derived from sewer laterals both the public and private portions.  Specifically requiring property owners to remove sources of I/I (rain water) from the sanitary sewer and where they have inadequate storm systems to divert it to is a problem.  This is an extremely difficult process, specifically dealing with private property owners.  The source of leadership in addressing the I/I problem, must come from the City, to whom the residents have paid their monthly fees for years to maintain the system both for today and in the future.  However, the City hasn’t the right by law to enter onto private property, nor is it their responsibility to maintain private sewer laterals.  This makes addressing the problem a joint venture.  Maintenance of a sanitary sewer system as a whole belongs ultimately to the customers who support it and the officials they elected to manage this often complex system.

He said it makes more sense to put that cleanout in the most logical place (not necessarily at the right of way).  There are other specific features that the city may want to include such as televising both sides of the lateral and lining the sewer.

The overall objective in the proposed regulation and plan is to move from finding/defining the problem to a solution as expeditious as possible, and with minimal cost to both the City and property owners by gaining access and doing the testing which is very time consuming for both the city and the property owner.  Another objective is to provide acceptable resolutions to anticipated common problems.

D. Squires said this will be a city-wide lateral connection issue.  The elimination of the VOL overflow is top and center. They want to take a look at things of establishing the point of responsibility.  He felt it was a good idea to establish the clean out location and enforce the repairs, which has to be done through legislation.  He has a document that addresses lateral connections and allows entry to a homeowner’s property.  He said they need to take a look at enforcing water shut offs if they do not comply.  The relining process only works on legal connections because illegal connections will be removed from the sanitary.  When you remove these legal connections this is where the culvert replacement and ditch cleaning will help.  He stated that if the homeowner does not have the financial means of making these repairs, then the question becomes whether or not the city will pick up the contractor’s prices and do an assessment. If they have a lot of illegal connections will they want one contractor do them all.  These are the areas that council will want to zero in on.  He asked for council’s feedback by the next council meeting because they do need to move this forward.

H. Strickler said she has a lot of questions which may be better served at the utilities meeting in two weeks. She asked if the law director will review the draft legislation as presented.  D. Squires said he will present this plan to the law director so that he can put the legal language into the document. 

F. Ostrander said that he read an article recently whereby Norwalk was trying to address this similar issue and wondered if the administration looked at them in their survey.  G. Rigby said he is not familiar with this.  F. Ostrander asked if there was any equipment that can meter the flow rate effectively.  G. Rigby stated that there is a device that does this. 

B. Brady asked if the city has relied on the smoke tests of where the problems are.  G. Rigby said the smoke tests guided them in a direction.  B. Brady said if they follow through with turning off water than they may be punishing the rental properties (tenants) instead of punishing the property owners. 

H. Strickler stated that this ordinance will have to have teeth if it’s going to work.  She said if there are no consequences to not complying then there is no sense of even passing an ordinance like this.  She said she was fine with the repercussions.  J. Gabriel said they need to pay attention to the right of appeal process.  He said they are asking $250 to appeal.  He said if they are doing 200 houses throughout a two-month period, than they could have some contractor issues or timing issues.  G. Rigby said that the $250 is nothing more than a token amount of money that says you’re not just wasting his time.  J. Gabriel said when they determine who would sit on this board they must do their best to make sure this person is qualified in this field and has knowledge of the ordinance, and what they are trying to accomplish.

H. Strickler said that every other neighborhood won’t be under such a time crunch.  However, they are under EPA mandate for the VOL.  She said the Marcy Kaptur grant will help with the sanitation and the relining of the main line.  A question that would be best answered at the next utilities meeting is discussion on overflows.  She said that all basements that have sewage in them are considered overflows by the EPA and the city has to correct those.  The VOL is not the only area because there are four to five basements in her ward that had sewage during the last rain.  She said that Morton Road has them too so she wondered what the time line was for these.  D. Squires assumed their most important elimination would be the overflow going directly into Lake Erie.

F. Ostrander asked the engineer if he has dealt with these issues in the other communities he has worked in.  C. Howard said he has not but knows it is a very touchy situation in other cities.  He noted that other cities don’t have findings against them.

B. Brady said in order to make the August mandate they have the $600,000, plus the city’s $100,000 which is the city portion of the job.  She asked if the city could get that far and cut the infiltration back enough past August and then attack this issue further.  G. Rigby stated that it starts with the legislation process and implementation of the program.  B. Brady said the city needs to avoid further fines. 

C. Howard said based on the studies there are some areas that need point repair.  The big issue is the existing pump station because it’s inadequate and the wet well needs to be bigger in storage.  It needs to be sized accordingly and the private issues need to be dealt with city-wide.

J. Gabriel said in his industry he deals with the EPA frequently and it’s a progress thing. He said you should start with the legislation.  He felt the EPA understands because the wheels of government turn slowly.  If they don’t meet the August deadline then at least they have things in place and the EPA will see that they are close to meeting the deadline.  D. Squires said this would be a best case scenario.  He said the EPA was adamant in wanting this overflow eliminated by August since the City has been made aware of it since 1992.

H. Strickler asked if the grant could be used to fix the lift station as well.  C. Howard said yes and advised that the city has an Issue II – OPWC grant for $324,000.  He said anything above and beyond that is the assessed portion of the project. 

D. Squires asked council to review the information and give consideration to the strong points they feel need to be in the legislation.  He said he will be bringing this to council next week.

TOPIC TWO:  Review of Ordinance 2008-13 (Group Hospitalization Insurance)

J. Gabriel said when he originally put this item on the agenda it was to add some wording to clearly define the elected or appointed positions that are on the insurance.  He was aware that there were people in the audience wishing to speak on this issue and asked them to kindly keep their remarks somewhat brief because there were so many present.  He explained that there is a misconception about this ordinance.  This ordinance as written will not affect the Local 860 or the police unions.  This specific ordinance basically pulls the non union employees in the city by disconnecting them from the Local 860 for healthcare, and puts them into a group insurance, which the police department would already fall under. 

No matter how council votes on this ordinance it will not change the healthcare for the police department.  He said they can address the larger issue of the health care of the police department if the employees choose to do so since it is a fitting topic.  He said just because of the outcry they have had, he thinks the police or the others who would be affected by this ordinance, whether it would be the non union employees, clerk of court, and the employees from every corner in the city; what they say is that they were shocked at the size of the deductibles.  He said depending on the income this is hitting up into the 10 percent of their income for quite a few of them.  Once they start hitting these numbers and has somebody in the family with a pre-existing condition, then those numbers add up quickly.  He asked the administration to consider sitting back down and reconsider the course of action on this. He suggested that they sit back down with the police and with the non union portion of the workforce. 

He didn’t think anybody in the room didn’t recognize that there were going to be changes in the healthcare because at the existing rate it was high, and he didn’t know if the City could have kept on going at the rate it was going.  He thought the police were all too willing to work because as he read that portion of the labor agreement there was a proposal in there that was accepted to have a board.  The board to him was a negotiating board and he didn’t know that it was treated as such.  He said as he was told, a proposal was brought in and put down without really any discussion or input with it.  He didn’t know what council necessarily can do, but from his personal standpoint he would like people to sit down.  He said it doesn’t save them any money if the entire workforce is angry.  He felt there is a middle ground to be found between what they had and where they went.  He thought they just went too far.

H. Strickler said if she wouldn’t have heard from city employees, she would not have had any idea why there were so many city workers in the audience last week.  She said council was never apprised to any of this and from her knowledge she didn’t believe the binding arbitration agreement had even been signed.  She questioned how they could go and change the health care insurance when this agreement has not been signed.  She thought it was in breech of a binding arbitrator. She felt they put the city on really slippery ground.  She said there has to be some kind of committee formed like the binding arbitration agreement, so that there could be some middle ground that is reached.  She was a little disappointed that the finance director was not present, but noted that the mayor is present and she is every employee’s boss, and she should be able to answer the questions that will be asked because she is their boss, even more so than the finance director. 

B. Brady said they could put this discussion under the employee relations committee and ask for representatives from each of the unions to sit down for open discussion.  She said she can sit as the representative for council on this group.  She asked the mayor if there seemed to be a problem with sitting down and hashing this out to see what their options are.

Mayor Anderson said first of all she would like to say that the first that she heard of the problems was at the last Monday night council meeting. 

Secondly, she stated that she has tried to pass the word to all the employees every opportunity she has had that it is their full intention to go through the health care that has been proposed.  She said she doesn’t have the same understanding that council has. 

Mayor Anderson stated that they are going to meet once again with Dick Sheldon to make certain that the specifics are understood by her as well as all of the employees because she doesn’t understand the deductibles to be interpreted as they understand them.   She said they have not had the opportunity to meet with Dick Sheldon.  She apologized that Wayne Hamilton was ill and advised that he is not able to meet with Dick Sheldon at this point in time.  He had asked her to hold off on their discussions until he can be a part of those meetings and those discussions because he has been involved from day one. 

She stated that she is of the understanding that the arbitrator’s ruling; the conciliation; the binding arbitration, set forth stipulations. It has been decided already as far as how the result of the negotiations came out and it has been mandated.  She thinks they are all aware of the four points that were considered in that negotiating process.  She stated that the union was decided that the raise; the percent; the income adjustment, and also kept longevity.  She said this was decided as mandated by the conciliator.  Neither the union nor the city has any recourse in that opinion and that judgment that was handed to all of them.  She said what the city was mandated to be in charge of or get from that negotiation process was the me-too clause in the union agreement, and also the right to establish the health care policy and program.  Out of this came the establishment or the advisement sort of speak to set up a health care committee that would involve representatives from the unions and the administration. She believed this was the first meeting that happened on that Friday.  She said she was not a part of that meeting and thought there was some confusion from that meeting.  She said they haven’t been able to resolve this up to this point in time, but could assure them they would resolve it. 

She stated that they will have to realize that there will be some adjustments in the health care provision by the city.  She wanted them all to understand that as she is the administrator for the City of Vermilion and is technically the “boss” of all the employees here; she wants what is good and in the best interest of all the employees.  She said they all work together and are all a team.  She recognizes that these are some major shifts in the way things have happened in the past and how they will probably continue to happen in the future.  She said as they all realize they have “x” number of dollars and there is one pot of money from which to draw from.  At the same time, she realizes that she represents and has the interest of the taxpayers in mind in this city as well because they are the ones that are paying the bills.  They are paying the bills for health care, for raises, for roads, for police protection, and the taxpayers are paying those bills for everything and their interests do have to be represented.  She said they haven’t seen them with any more taxes and they haven’t been willing to come forward and up their participation in the city expenses, so the pot remains rather fixed at this point in time. 

She knows as mayor she is working with all of the commitment and dedication she can offer to bring economic development into this city and increase the job base, so that the city will have a larger tax pool with which to fund all the things they provide in the city.  She thinks this is where she is trying to focus her efforts and thinks it’s the best thing she can do for all of us.  She stated that it is a difficult position and feels the employee’s situation as well as she feels the financial crunch, and the ability to pay for all of the taxpayers. 

With this said, she believed the ordinance on the agenda doesn’t pertain to the health care policy that they will be deciding upon.  It has to do with the city’s responsibility to provide insurance and the city deals with an opt out clause; out mandate to offer COBRA there are some other aspects to our city health insurance and that’s what this ordinance is dealing with.  She said they are very comfortable holding off on voting on this ordinance if they would be more comfortable waiting to discuss this with Wayne when he comes back.  She said it is unrelated to the health care program that they are talking about with the employees.

She said as far as the community relations committee she wants everyone to know and be assured of the fact that we have the mandate to work with a committee on the health care policy already.  That was a part of the makeup of the provision that came out of the negotiating process.

B. Brady asked if they could set a date just for everybody’s piece of mind and look at the calendar right now and say on this date we will meet with representatives of the union so that everybody has something to look at.  Mayor Anderson said in her mind that would have happened already if Wayne were in the health condition that we could do that.  She said that W. Hamilton has asked that he would still be a part of that process since he was in on it from the beginning, but certainly they could do that.  She said she is perfectly able to pick up where he is not able to participate.  She said that she hasn’t up to this point in time.

H. Strickler addressed the mayor by stating that the employees were told at that meeting that April 1 was when the new health care was going to take effect and that they really didn’t have a choice.  She asked the mayor if she was saying that as of now any new health care plan is on hold and she is not going to go forward with this until she meets again with the representatives from the different unions.  Mayor Anderson said, “Yes”. 

S. Holovacs asked how many plans there were.  He understood that 860 are on a different plan than the police department is on.  He asked how many other plans they have in the city.  He said $250/$500 deductible is the 860 and the police are under a $500/$1000 deductible on the current.  He asked if there are any other plans in the city and if when they do make the change will every employee in the city, other than the union contract; will the rest of the employees, the administrators and everybody else be on the same plan.  Mayor Anderson said that as the ordinance is set up currently, the non union employees, not a part of the FOP or OPBA, follow the 860 contract negotiations.  S. Holovacs asked about the administrators, the mayor, the service director, and everybody else.  He asked if they would follow the 860 contract.  Mayor Anderson said they have been following the 860 and it was there interpretation of the ordinance. 

S. Holovacs said that through the time there were negotiations with the police department and the administration on the new contract; at the end when the arbitrator came in and had his final say and they went through the raises and all, he had a misunderstanding which he hoped somebody could help him with because it was all hearsay of what he heard and what happened on the presentation of the new plan that was presented.  He thought they were putting together a committee from the police department and a committee from the administration to meet.  He said his understanding and if he is totally wrong because it is hearsay from the employees; from the police department; that there were no negotiations and they were just handed a new policy.  He asked if this was correct.  He thought they were going to get together the two groups to discuss hospitalization. To him it sounded like they were just handed something without any negotiation.

He said he had a chance to sit down with Wayne who showed him the different policies and premiums and he wondered how they were going to go from $500/$1000 to the $2,000/$4,000 deductible because they almost have to go through negotiations again.  He said it is a dollar value when they change $500/$1000 to $2,000/$4,000.  He was surprised that they were going to try and change the policy and sit down and talk, because usually it is give and take in negotiations.  He said for him to take money away from a police department or union he would have to give them something, so he is kind of loss on how they got to the point of putting these two committees together and then if it’s true what he was told, they were just handed a new policy.

Mayor Anderson said she did not bring the written report with her so she can’t read it verbatim, but her understanding was what she explained earlier.  How the negotiation process ended up with the arbitrator saying that the police union was going to get the raise that they had asked for and to keep longevity.  Those were parts of what was negotiated.  The city was going to determine the health care policy and they did get kind of the me-too clause worked out of the contract.  And, part of the setting of the health care policy wasn’t that they were going to negotiate a policy.  They were going to have a meeting that explained the policy to them because the negotiation for that didn’t exist anymore.  She said this is her understanding of the conciliator’s report.  She said she could be wrong on but this is her understanding of this and it’s how it was explained to her.  She said that they in a sense; their union agreed to give us that ability and we gave them the raise that they negotiated for.

J. Gabriel said while he would agree with those comments, Officer Mayer sat here a week ago and had said that one of the reasons they were so willing to give that over is because; in their eyes, under good faith there was a committee established where health care concerns would be addressed jointly.  He said this is where he thinks the rub is.  He said where they said okay they are willing to concede this point as long as they do have some input.  He said there was no input basically and that’s a big problem they have right now.

Mayor Anderson said she wasn’t there but she has stated every chance that she gets is that their purpose is not to put hardships on the employees’ finances, but at the same time they did have to. She thinks the understanding with council and the negotiation process was that they wanted it to turn out to be relatively a wash.  So, if they gave salary they would like to get it back in health care.  If they got health care then we wanted it back in salaries.

H. Strickler thought the perception from the employees is they agreed and got this pay raise, but in reality it is not a pay raise if they are going to have to be shelling out that much money.  They are actually losing money in the contract and she thinks this is negotiating in bad faith because they agreed to something not knowing what they were going to be making.

Mayor Anderson said they have to get the report out and will have to read it, and will have to get a legal opinion on what it actually says and what the result of the negotiation was. 

H. Strickler asked the mayor if the police have been paid their back pay yet because according to the arbitrator they were supposed to get it in January.  She asked if they had received any of it.  Mayor Anderson said she didn’t believe they have received their back pay.  (Note: City employees in the audience stated, “No!”)

Diane Dlugos full time dispatcher of the Vermilion Police Department stated that she was as the meeting with Officer Grassnig which was there first and only committee meeting.  She showed council what they were given which is a piece of paper that outlines the current plans in effect, and then the bottom line it was told to them what they would be getting.  She said there was no committee making recommendations on health care containment.  She said there were no meetings prior to that.  She said this is the first they heard.  They thought they were going to start their committee meeting and start deciding what would be in the best interest of the employees and the city on health care.  She said they realize that they have to make concessions but not that much.  This is taking a lot more out of her pocket than the raises put in; a lot more.  She said she has both arbitrators’ findings on the FOP.  She read that the city agrees to establish a joint advisory committee on health care benefits.  She said it wasn’t joint advisory.  It was just a committee where basically they were presented what they were going to get.  She read that the joint committee will periodically evaluate the benefits and costs and make recommendations to the city for cost containment measures.  The city agrees to present any pending changes to the health care insurance committee prior to the effective date of such change.  She said the OPBA one reads pretty much the same and it does say that they may implement reasonable health care changes, including increased deductibles and co-pays during the life of this agreement.  She said they had already agreed on the $40 a month and have already been paying the $10/$20/$30 for a long time that the other employees haven’t been paying, and they have had the higher deductibles.  She said they agreed to it to help the city out and they have been doing that for a long time.  She said they went from one of the ok plans to the worst and the deductibles are on the paper.  She asked the mayor if she got a copy. Mayor Anderson said she did not.  D. Dlugos asked her if she wanted a copy.  Mayor Anderson said she would.

B. Brady asked if these were deductibles or is the max out of pockets; the $2,000/$4,000.  D. Dlugos said it is $2,000 for single out of pocket and $4,000 for family.  B. Brady asked if they were sure they are not max out of pocket.  She said this isn’t what she has been able to get from anybody.  D. Dlugos said it is the deductible, plus the city will pay 80 percent of anything over that, up to $10,000.  B. Brady asked if it is 80/20 percent after the $2,000/$4,000.  D. Dlugos said yes and right now they are paying 100 percent up to $6,000, so this would be more out of their pocket.  She said if anything happened to her tonight she would have to pay $2,000 right up front as the deductible, plus 20 percent of anything over that.  B. Brady said so this is an extra $2,000 so it makes the total out of pocket $4,000.  D. Dlugos said she would like to have a committee and have give and take.  B. Brady said they have not seen the plan.

J. Gabriel said that Barb is right and this is yet another issue because council was given information showing raw numbers that after the negotiations are done they are going to shop out and these could potentially be the plans and potentially could be the savings.  He said not once did he ever see a deductible.  He said that he has insurance and has kids with operations and knows exactly what those deductibles mean, so he doesn’t want anybody to think he doesn’t.

S. Holovacs said he did have a meeting when they discussed the budget and he spent a few minutes with Wayne and they looked at the different policies. He said he looked at the deductibles and the premiums and the only comment he made to Wayne was; because he too wondered how they were going to go from $500/$1000 to $2,000/$4,000.  He said he explained to him that his company does it a little different.  They offer their employee’s three deductibles and two of them have a co-pay, and the last one is even higher than this.  He said their last one with no co-pay is $2,000/$6,000, but they have a $500/$1000 with a higher co-pay.  He said he told him that this was a way their company was able to start saving money on their hospitalization.  He said he didn’t know how the city was going to offer them one because there is no offering.

D. Dlugos thought the OPBA has to go with the non union employees on the insurance plan and the FOP goes with the best plan in place at the time.  She said they are little bit different.  She said that she is not in the non union but this is going to be hard on them too.

B. Brady asked if they could set a date that they can sit in small group and talk.  Mayor Anderson said to be right about this, W. Hamilton has set up a meeting with the insurance representative so he would like to go through that information and then meet with the committee that met, and open up conversation and discussion in that meeting that was established, and at least make the presentations where everything is understood and there is discussion back and forth.  She said they would like to bare minimum have that meeting with the insurance representative.  She said there are some other avenues they are exploring as well.  B. Brady said that they need to give them a time frame.  J. Gabriel said that council is going to need a lot of information because they have been totally blindsided by this.  He said that his phone started ringing on Saturday and it rang all day long.  He said that he understands people are upset.  He said how bad does he look when they call him and tell him they got this new health care plan and these are the deductibles, and then he is asked what council is doing or what they think.  He said he didn’t have any idea of what they were talking about.  He said that council is going to have to get inside the loop on some of this.

M. Rossini said he would like to see this meeting set up and it should almost stop this conversation.  He said he would also like to have a representative of council and he would designate Barb Brady because she seems to be informed.  He said he would like to have somebody come back from council beside somebody else telling them.  He stated they are coming to a point where they are going back and forth.  He said he was in the meeting that the police union negotiated and that is binding arbitration.  B. Kish said there are negotiations and then there is fact-finding and then council voted to reject the fact-finding report, and then it went to binding arbitration.  He said what the arbitrator ruled is basically binding on the city unless it is taken to the Court of Common Pleas or Court of Appeals.  He said a committee was supposed to be established to discuss reasonable health care which is in the contract that was basically put upon the city by the arbitrators. 

F. Ostrander said they should table Ordinance 2008-13 until some day when it comes back to life.  J. Gabriel said absolutely and H. Strickler agreed.

Steve Davis of the Vermilion Police Department told the mayor that she made a comment that the insurance was to offset their raises.  He said as the chief just said this is something they won in arbitration.  He said that the administration didn’t want to give them a raise.  They asked for a raise and as a matter of fact the raise they got is less than what Amherst just got.  They just got 3.75 percent raises and they also make a couple dollars an hour more than them, and their insurance is less than them.  His suggestion was that whoever is going to be on this committee that they contact Amherst, or contact Avon Lake and other places where the insurance isn’t as outrageous as it is here.  He said their deductible is already one of the highest and according to what Mr. Hamilton gave them it would put them way out of line, plus their pay is still lower than other departments even with that raise.  He said this is something the arbitrator decided.  The arbitrator said there could be a committee with reasonable changes.  He didn’t think a 300 percent raise in their deductible is reasonable and he doesn’t know anybody that would.  Finally, he said if they are going to have a representative on council they would prefer Mr. Gabriel to be on it since he seems to be the one that is on this particular committee.

Michelle Fiegelist of the Vermilion Municipal Court stated that she is one of the non union people.  She said she is very confused because Mr. Gabriel started out saying that he thought this would only deal with the non union employees.  J. Gabriel said the ordinance before them is really an ordinance that addresses a couple of things from the city.  One is to preempt Ordinance 2003-17 which is the ordinance that ties the non union employee’s health care to the 860.  M. Fiegelist said the ordinance states that the city will provide the dental, the optical, the medical care, and the maximum they would pay is $40.  J. Gabriel said that this ordinance preempts that and it would put them into the group insurance that would follow everybody outside of the 860 at this point.  M. Fiegelist asked how many people would this might be.  J. Gabriel said this is an assumption but he is guessing that depending on whether they can get it amended, it would be the police department; he wasn’t sure if the FOP had a me-too with the 860 or not.  D. Duglus said the FOP does not and their me-too only ever applies to within their department.  J. Gabriel guessed this would include the directors, the administrators, the non union, court, clerk of council, and all non bargaining. 

M. Fiegelist said the reason she asks and she doesn’t know anything about insurance or unions and never has been involved in unions or anything, but it always seems to her with insurance that the more people you have the better price you get.  She said if they tie everyone in, it would seem to be a cheaper amount.  She said that the mayor did say that she tried to inform everyone about this, but she never heard a thing about it.  She said the only thing she personally heard was through the police department and that is not right.  She said that is a given.  She said to not even be told how or that they were working on a change; you don’t treat you’re employees that way.  You just don’t.  She stated that a couple years ago she came to a council meeting asking about the money that the city is supposed to get from the counties for a portion of the Judge’s salary, the bailiff’s salary, and the clerk’s salary which is all in the revised code.  It is approximately $90,000 a year and to her knowledge that has not been collected for years, not just in this administration but in the previous administration.  She asked what they are doing.  She was told at that time that it was being factored in.  B. Brady said actually it is being looked into.  M. Fiegelist said she was told two years ago this.  She said that she knows that Barb has been in talking about it and so has Mr. Gabriel.  J. Gabriel said in his defense he just came in on Friday asking about this.  He said this is money owed the city by both counties.  M. Fiegelist said this is money that could be used to be paying these employees that are costing the taxpayers money, of which she is a taxpayer because she lives here and pays taxes.  She said this is just bad form.  J. Gabriel told her it is a point well taken.

Gwen Fisher, Clerk of Council commented because she is kind of in the same boat as Michelle and just by sitting here listening to certain comments she agreed that the non union employees never heard anything about this.  She said they heard it through the police department.  She felt there is no respect for the non union employees at this point.  She said she is also disturbed by the fact that the mayor said at the last council meeting that this was the first time she heard about it.  She said that she would think as the Chief Executive Officer that she would have known about this as instructing the finance director.  She said to her this is disturbing along with the rest of this whole insurance plan.

Mayor Anderson said she was aware of the meeting and was aware of the fact that Wayne was going to present the policy to them.  She said what she was unaware of the reaction that came out of the meeting.  She said she was not in that meeting so it was not what she was referring to that she was not aware of.  She said she was not aware of the disfavor or the displeasure, or the reaction on the part of the employees until the meeting that Monday night when they appeared.  She said as far as the non union employees are concerned they have always followed the 860 contract and those negotiations have not happened yet.  Gwen Fisher stated that the ordinance preempts that so the non union employees will not follow the 860 anymore with this ordinance.  J. Gabriel said that is true.  B. Brady said that yes the ordinance changes it.

J. Gabriel said their best bet is to sit back down to see if they can come up with a solution to this because they are going to be looking at trouble two years from now in negotiations.  He said if they lose all faith right now then good luck to them a couple years from now. 

J. Gabriel MOVED; H. Strickler seconded to recommend to council table Ordinance 2008-13.  Vote 3 YEAS.  MOTION CARRIED.

Mayor Anderson said they will set up a meeting just as soon as Wayne is able to participate but if it looks like he is not going to be well enough in a short period of time, then they will schedule that meeting with the insurance representative and will get their arms around this health care situation.

Liz Henderson of the Vermilion Municipal Court asked if there would be non union representation in this meeting.  M. Fiegelist said she would be happy to represent the court.  F. Ostrander told the clerk of council that she could attend as well.  Mayor Anderson said she personally doesn’t think there is anything wrong with anybody participating in the discussions that involve our health care policy for all the workers in the city.  She said it is something they all will have to be confronted with so anybody that wants to participate in her mind is welcome.

J. Gabriel said they will come up with a date and get that out to everybody and hopefully they will be a lot more efficient as far as getting information.

F. Ostrander confirmed that nobody’s insurance will change at all until after this meeting.  Mayor Anderson said correct.  F. Ostrander said after this it will come back as an amended ordinance and sometime after that they will vote on it.  B. Brady didn’t think it would be amended because the ordinance doesn’t carry what the deductibles and the co-pays are.  It just says who is moving into the other contract.  B. Brady said it just doesn’t specify what the contract is going to be. 

J. Gabriel said he actually put this item on the agenda long before the week before last. The reason he wanted it on is because in his view he would to amend this ordinance. He thought it would have to come back before legislative because he would like to amend the ordinance to include the exact wording that says it includes positions where it deal with full time employees.  He said he would also like to include the specific wording that says, “Including positions elected or appointed who qualify for insurance”.  He said if they are going to do group than he wants everybody in there.

TOPIC THREE:  Driveway Culvert Replacement Project

D. Squires reported that he provided council with a storm water management program.  In order to move forward with this plan it was his opinion that they address the ordinances that deal with culvert replacement and ditch cleaning (Chapter 1026.01-1026.99).  He referred to Ordinance 2007-56 which is the pipe specification for replacing the culverts.  He asked council if they had any input or concerns. 

S. Holovacs asked the service director which streets they finished last year.  D. Squires stated they finished Brownhelm Station Road.  H. Strickler asked how they were billed.  D. Squires said there was no billing because it was a city ditch cleaning project.  He noted that there was an appropriation for ditch cleaning and culvert replacement on Hazelwood and they have not done any work on Hazelwood.  However, it is at the top of their list to do.  There are some adjustments and he thinks they need to consider moving forward with this plan. 

H. Strickler asked the engineer if he reviewed this plan and whether he was part of the specifications of what the pipe should be.  C. Howard said he was involved with the ordinance that changed the pipe sizes and material as passed in 2007.

B. Brady said in Chapter 1026.06 it states that you have to have a certified person to do this so does this eliminate somebody from doing it themselves.  D. Squires said yes, however, he asked council if they want homeowners to hire their own contractor to replace a culvert pipe.  The culvert pipe if not set property could affect everything upstream at the higher elevation.  B. Brady thought there should be some give and take on that if the problem is an emergency.

D. Squires said the ordinance specifically states that once a permit is requested the engineer will have the approval on. . .  B. Brady interjected by saying that that the hard thing is setting a line all the way down the street. 

S. Holovacs said for a hardship case it would either be the administration’s decision or the engineer’s decision to allow someone other than the city to set it as long as they follow the grade and came back with a final inspection.  He said if they are responsible for putting it in then they will be responsible for taking it out if the grade is wrong.  He preferred to see the city set them and then the grade is set right.  He asked if the engineer would be comfortable with this.  C. Howard stated that in the past he requested the homeowner to submit a sketch showing what they were going to do and then they would go out and field verify the work to make sure they actually installed it.

J. Gabriel said when they are talking about private property ditches and culverts is the city doing this work and then assessing the property owner.  D. Squires stated that he wants to focus on the culverts.  The ditch cleaning is the city’s responsibility as far as a true ditch cleaning program as far as excavating out material and cutting in a swale. They are now talking about replacing the culvert which will be in right the way, which is within the city’s property.  The ditch too is in the right of way.  There is a policy in the city that he would like to transform to ordinance format that culvert pipes which are in violation of the city standard 12” minimum diameter will be replaced.  The owner of the property will pay for all materials, pipe, and backfill.  The city will provide the labor.  Per the initial projects outlined in the storm water management program these are the ones he would like to start on.  However, he has been maintaining a list of problem areas within the city which is comprised of 24 known locations.  He doesn’t want to make these point repairs so that they appear to be just a band-aid fix and their not looking at the overall scope of the program.  They do want to do an entire street, but he wants to address these issues first because the 24 areas in violation are really affecting many more homeowners, rather than just the one.  Again, he said the city will provide the labor and the property owner will provide the material. 

J. Gabriel asked why the city is providing the labor.  He said these are private property issues and in Chapter 1026.04 it says no owner or occupant shall block or obstruct to permit to become blocked or obstruct any ditch or drain tile.  To him this is pretty clear cut that these are private property issues.  Although they lead to a larger public issue, individually these homeowners have responsibilities to maintain these ditches and culvert pipe.  He asked why as a city would we hire manpower and extra labor/hours to do all this work when we are really talking private property responsibilities.  D. Squires felt they would get something done rather than leaving it up to the resident and trying to enforce it.  He thought it was part of their overall master ditch cleaning/storm water program because they have to do something in the neighbors that J. Gabriel is well aware of.  J. Gabriel said he is and is not saying that nothing shouldn’t be done, but wouldn’t they be better off looking for more of an enforcement tool to have people take care of their own personal property instead of incurring those kinds of expenses, especially in the budget they are talking about.   D. Squires stated that the labor costs will be transfers from the storm water fund to pay for this work.  J. Gabriel said they have such a large expense with Elberta and it would be very easy to consume quite a bit of that when we have major outfall issues in the Elberta area.  They are talking about $838,000 worth of expense and if they start taking the money here and there and providing labor for people’s culverts and cleaning out their ditches, then it wouldn’t take long before they take a good chunk.  Over the course of years he feels they are talking about quite a sum of money.  He said if they start a program where do they start and where do they stop.  This is a concern.

B. Brady said one problem is that it has been started and a precedent has been set from past administrations to do the work.  She said it’s not that somebody can dig their ditch and only affect themselves.  You can’t do one house, it has to be a whole list and go down to the outfall or it’s a worthless thing.  So, if individuals are cleaning their own ditches how do they initiate if they don’t have a piece of that to get the water to where it has to go in the end.  She said the city has set a precedence to do it and to provide the manpower in the past, so unless they are going to do a major turnaround and completely disregard what they have done in the past they need to continue along the same lines.  She said this isn’t something other cities don’t do.  She stated that in reviewing Westlake’s policy, they do the whole job and charge $2.50 per linear foot which includes seeding, replacing driveways, the whole bit. 

H. Strickler said they set precedence when they had money and now they don’t have money.  She said that Westlake is loaded and has a lot more money than Vermilion so to use that as an example.  She asked how the city is going to pay for this and where is the money going to come from and what are they going to cut in another area.  She asked if it was more beneficial and wiser with the taxpayer’s money if the resident’s just do it themselves.  She thought it was a good conversation to have now.

D. Squires said what he doesn’t want to do is be here in June talking about a culvert and ditch cleaning program because they have so many storm water issues in the city. He feels this is a good way to start drying up bad areas.  This will make an impact more than just putting it on the responsibility of the homeowner.  He didn’t they would be able to enforce this enough.  His fear is that they won’t have any work done come fall.  He said they also need to be concerned that as far as maintaining the culvert he doesn’t think the resident’s should have to maintain them as far as keeping the flow of storm water through it.  He didn’t know of any homeowner that can clean a culvert pipe and believes this should be the city’s responsibility.  The homeowner should be responsible for maintaining their open swale or ditch and keep it free of loose debris.  Secondly, another important point is that when you find a culvert pipe in violation (being under 12”) and it’s a under a concrete or an asphalt apron, who pays for that replacement.  He feels that is the homeowner’s responsibility and not the city’s.  He felt this is a program that should be implemented.  He said he also feels they will see the fruits of their labor quicker than if they put it on the responsibility of the homeowner.

S. Holovacs agreed that if a culvert has to be replaced and they need to cut through a concrete or asphalt driveway to do it, then they should have something in writing that says it is the homeowner’s responsibility.  He said they should put teeth into this or the city is going to be replacing aprons.

F. Ostrander said he doesn’t have a problem with the city cleaning ditches but when it comes to undersized culverts then the city should be treating them as any other property management where they have defect, and have 30 days to fix it or the city will fix it and set a fee and do the work.  He didn’t’ think the city should be giving this stuff away because there are hundreds of them.

D. Squires said he just wanted to bring it to committee’s attention that this has been past practice and they have done a couple jobs already where the city provided the labor; property owner provided the material, and the project went real well.

Skip Griffith of Timberview said there is a large percentage of this town; Valleyview being one of them that have working up to date modern storm water systems.  The residents are paying $3 per month into a fund that the city wants to take and use to maintain, and to continue substandard systems.  He said if they are worried about a drainage problem or a storm water problem then assess it and put in the storm water system at the standard the rest of the town has.  He asked why should they, when they have an ordinance on the books that says the property owner is responsible for his driveway tile and his ditches; make him do it.  If he has to pay for it and has to replace it, or pay to have the ditch cleaned out than maybe he won’t be so anxious this fall to rake his leaves into there, and throw his old engine blocks in it, drive over it, so he just has a place to park.  He said, “Make him pay.  Then he’ll maintain it”.  He asked why the city is taking their money; the money they pay into that storm water fund to maintain these substandard systems.  He said this is not getting ahead of the game.

D. Squires responded that all resident’s pay into the storm water fee and wherever those monies are needed; it may be in Skip’s neighborhood, it may be in someone else’s neighborhood.  Again, he felt this was an adequate way, a feasible and affordable way to start managing their storm water.  He said if they don’t do something they will be sitting here in the fall or next year having done nothing.

J. Gabriel said this isn’t a critique on D. Squires whatsoever because he knows he has put effort into this plan.  However, what they really have to decide is if they will continue on with past practice and if they can afford to.  M. Rossini agreed that the cost of the material and the pipe should be borne by the homeowner, and also agrees that they need to have some fee for digging it up because if they keep eating into that money they don’t have. . .  He said anytime a homeowner has to have somebody do something, they have to pay for it.  He said it is a cost regardless if the city does it or somebody else does it.  Anytime you let an individual do it you don’t know if you’re going to get the job done correctly. 

D. Squires asked how they should go about establishing this fee.  M. Rossini said they must have some idea of what it cost.  B. Brady asked that every time the city digs a ditch they will assess that person.  M. Rossini said that whenever they set a culvert they charge for digging and setting that culvert.  B. Brady asked if the resident doesn’t have a ditch the city will dig the ditch and won’t charge that resident.  M. Rossini said if it isn’t a 12” pipe and it doesn’t meet code. . .  B. Brady said part of the problem is whether it met code when it was put in.  She said they credit the homeowner for pipe in the ground if it was put in according to the specs at the time.  Thereupon the city is going to end up giving them credit for 90 percent of the work and it will actually cost the city more than if the city charges them for the material and the stone.  M. Rossini said he never heard anybody say anything about credit.  B. Brady said this is what the storm water says.  It says that if you have existing pipe in the ground that was put in according to standards at the time, you get a 90 percent credit.

S. Holovacs thought there are a lot of weekend warriors to where they do work on Saturday or Sunday and then cover it up with dirt.

H. Strickler said the 90 percent credit is totally thrown out the window now that they have changed the storm water ordinance for Edson Street.  She said that Edson Street was an improved storm water at the time, but now with the new ordinance they are paying 90 percent of it.  She said that Hazelwood will be paying 90 percent rather than 10 percent. 

J. Gabriel asked council if this was the policy they are going to follow or are they of the mind to do something else. 

B. Brady asked how many dollars the administration is anticipating to put in these culvert pipes.  D. Squires said to do the ditch cleaning on Brownhelm and ditch cleaning and culvert replacements on Hazelwood was $24,000.  He felt they could do a culvert in half a day, which would be a backhoe operator, possibly a part timer, and a truck driver.  He said they could do two a day.  B. Brady asked what kind of labor costs are they looking at.  D. Squires stated that he doesn’t have this broke down but can get back to council quickly on this.  He said it is probably around $80.00 to $90.00 per hour for the two full time employees, including benefits.  S. Holovacs asked what they are charging for the equipment; $75.00 for a backhoe, $50.00 for a dump truck.  He said this would be $300 for a backhoe for a half day and $200 in a dump truck, which is $500.

H. Strickler thought Hazelwood was done last year.  D. Squires said it was not.  H. Strickler asked if they put money aside for that.  D. Squires said they did but they never transferred the dollars.  G. Fisher replied that council did pass an appropriation ordinance for this.  D. Squires said the administration still needs to present council with an invoice in expenditure format to make that final transfer according to the ordinance, and they have not done that yet.  H. Strickler asked how much money was put aside when they were working on the budget for this.  She said they would have had to put so much money aside to do this.  D. Squires said he would have to go through the general fund.  Again, he noted that he is trying to get something done in the city and is trying to dry up a lot of their bad areas, so they are either going to do this or they’re not going to do this.  H. Strickler explained that it would help if they knew how much it was going to cost so they could make this decision.  She felt this was a fair question.

M. Rossini said it sounds like it is going to run a homeowner $500 in using the city’s workers and equipment.  S. Holovacs said the old rate quite a while ago was $75 an hour for a backhoe and $50 for a dump truck, so this would be $500 just for a half day, not including the $80 to $90 per hour for labor which would be another $320 or more.  This would be approximately $800 plus.  M. Rossini said there are not too many contractors that will do the work for that much less.

J. Gabriel asked the service director to get numbers together for this program for the next utilities meeting.  H. Strickler said they are having a special budget meeting next week.  J. Gabriel wasn’t sure they would want to discuss the details of this in a budget meeting.  H. Strickler said the cost they would.  D. Squires said he can very quickly put together the machine time and what three laborers would cost.  J. Gabriel said he is looking for the overall hit that the storm water fund will take from this because he has things that he wouldn’t mind seeing as priorities out of this fund, and they include three or four neighborhoods.  D. Squires stated that this will depend on how much work they can get done.  He asked if he has $50,000 to work with or $10,000.  He asked how he should do this.  H. Strickler would have thought that this was part of the budget process.  If this was a priority of the administration it should have already been built into the budget.  She said obviously this is a priority of the administration because they have talked about it for a couple of years.  If they really want it to happen then they should tell council what it will cost and then they can make it happen.  She stated that she isn’t against this but just wants to know the cost.  D. Squires said this isn’t his final proposal and it’s really not budgeted into Street M&R because that is where some of the labor would be coming from.  He will have to come up with actual cost both on the labor side.  He already knows what the homeowner’s portion will be.  He confirmed that council wanted the cost but to do how many.  J. Gabriel asked him what his priorities are as to what streets he feels need to be done.  D. Squires said he has 24 spot repairs that he does want to make.  J. Gabriel told him to bring council the numbers on the 24 spots.  D. Squires stated that he would like to do that and would also like to give council a number on doing all of the streets listed in the plan of which he’ll separate the two individually.  H. Strickler said that when they get a balanced budget then maybe they can’t do 24 but instead 12 this year. 

J. Gabriel recessed the meeting to go into the Health & Safety meeting.

TOPIC FOUR:  Review of Ordinance 74-104

J. Gabriel called the legislative meeting back to order. 

J. Gabriel said the reason for putting this ordinance on the agenda for discussion is because it is his feeling that council made a decision back in 1974 that we’re following today.  He said he would like to amend this ordinance to say that in any given year that transfers have to be agreed upon by not only the administration but get approval by council before any money is transferred.  To him it is that simple.  He said why they would let a council back in 1974 decide the monies to be transferred today; conditions change and they are in a much different environment.  He stated that he wasn’t sure what the environment was then but is guessing that it was better than it is today. 

He said it is to the administration’s credit that they didn’t transfer any money this last year because there was no money to transfer.  With this being said he thought council has the spending authority within the city and should have final say in any given year.  As he looks as this ordinance there are a couple things that he disagrees with. The ordinance is based upon 25 percent numbers and then he looks and says, “Is the Director of Public Safety really spending 25 percent of its time on water and sewer issues, and does the Law Director really spend 25 percent of his time, President of Council, Members of Council, and Clerk of Council.”  He said this ordinance has a lot to be desired.  Back in the day when money was good maybe. He said back in the day there was probably a reason for it and he isn’t judging those reasons.  He is not saying get rid of the ordinance even but to amend it to say that council must approve before any money is transferred.

F. Ostrander said he would like to add the language that says, “Money is not moved out in the year they were considered to be earned or lost”.  He said sometimes they say that they didn’t collect that from two years ago and should collect it now, and this previous administration did the same thing.  He would like to say that if the money isn’t collected by December 31 of the year it is earned then it’s lost.  B. Brady said that council should have to address it at a certain time so how would they do that.   F. Ostrander said from two years ago when it wasn’t collected he doesn’t want them to take it out today and that is what he is objecting to.

B. Brady stated that this is an enterprise fund and they have to keep in mind that it is supposed to be funding itself.  She asked how they are going to decide on how much time these people spend.  She said they certainly don’t want them to keep a time clock, so how they come up with these numbers she honestly doesn’t know.

J. Gabriel didn’t necessarily object to the overall sum but questions some of it.  He sees where they just grabbed a number, but his thought in protecting the funds is that council and the administration should be in complete agreement before any money in any given year is transferred. He said that council is the final authority and why they let an ordinance way back in the day make that decision for them year in and year out is. . .  He said they are kind of pushing their job off on an ordinance that was written when he was eight years old. 

B. Brady said she would also like to see a date where council has to address it by.  G. Fisher said it could be set up like the water and sewer rate ordinance.  J. Gabriel agreed to this as and suggested doing it in February.  B. Brady said they can budget the money into the budget rather than doing it after the fact.  H. Strickler said the past couple of years they have been in the negative and they can’t afford to pay.  J. Gabriel said at that point they would say, “No.”  He said all he is saying is that before this ordinance is acted out in any given year, council has the final say.  In his view they are not doing their job by allowing this ordinance to sit out and allowing it to be other people’s discretion.

H. Strickler stated that 50 percent of these salaries from these two enterprise funds seem very high.  She could see the city engineer and service director since this is where they spend the majority of their time on. 

S. Holovacs stated that a couple years ago they tried to stop the transfer and it didn’t go through so he thinks this is a great compromise to the whole situation.  He didn’t have a problem with the ordinance but wanted to see wording included that it has to come back to council for approval.

J. Gabriel said he liked Fred’s suggestion about any given year instead of coming back five years later and doing a massive transfer.

B. Sasala said he would like to have a business like that where there is a legitimate bill that is due the general fund for the services rendered.  “Come the end of the year you say you don’t have any money and you’re not going to pay the bill.”  People like Madio and other people who don’t get water and sewer are subsidizing that service to the water and sewer users and that to him is unfair.  He thought they need to set some kind of a bill for the services rendered and they don’t like the $45,000 then drop it to $20,000 or some other legitimate number, but to say you don’t have to pay your bill at the end of the year isn’t quite fair because that money now is not available in the general fund to give services to those people.  He said to look at it each year and manipulate the cost; they know what the cost increase is each for things and if they decide on what it is this year; inflation next year and you’re going to add something or leave it like that for a number of three years.  But, to say that you don’t have to pay the bill to him is not a way to do business.

J. Gabriel said what they are doing is the very thing they are doing themselves.  He said they went last year and never transferred any money.  Correct?  B. Sasala said yes because the rates aren’t up there where they can generate the money that should be paying the bill.  J. Gabriel said he is arguing right into his point. He is saying the same thing. Instead of them making that decision it’s really council’s decision to make and they will sit down as a group as their responsibility in appropriating the money and spending it.  He said it is to protect the funds.  He thought that if they continue to let this ordinance go they are really sidestepping their responsibilities.  B. Sasala asked, “But is it not a bill?  What would happen if they had to put a person in the water and sewer departments to do invoicing and purchasing? What would that cost you?”  J. Gabriel felt he was making an assumption that council is going to say no every year.  He said if the money is there and the transfers can be justified he doesn’t see why any reasonable council wouldn’t go along with it.  B. Sasala said if council says no one year that’s like saying they don’t have to pay their bill.  J. Gabriel said they just did that last year.  B. Sasala said he knows that but that is because the rates aren’t adjusted to where they can pay that legitimate bill.  J. Gabriel said they are arguing the same point and all he is saying that instead of the administration saying it, he feels it’s council’s responsibility to say it; over the seven members of this council.  That is what they are voted up here to do.  B. Sasala said he is hearing that they are saying, “We’ll forgive you.”  J. Gabriel said then he is not hearing him correctly.  All he is saying that year by year city council should look at this ordinance and say, “Do we have enough money to cover these expenses, and if so, we are in agreement”.  He said he is not asking to repeal this ordinance by any means but just feels they need to be responsible for it. B. Sasala said what he said is that they will look at it year to year and if the money isn’t there they won’t pay the bill.  J. Gabriel said this is just what they did last year!  He didn’t understand why it was okay for them but not for them.  B. Sasala said they did it out of there because the rate structure isn’t where it should be.  J. Gabriel thought they were arguing the same point again.  B. Sasala said the rates need to be adjusted to cover that legitimate bill.

H. Strickler said that Bob is saying that they should probably raise water rates 25 percent to make sure there is a positive.  J. Gabriel said that some years it just isn’t going to happen. Your new housing growth is not going to be and there are just some years where it’s not just feasible to transfer money.  He said he’ll stand by his original statement that it is council’s decision to transfer money, whether it is between funds or whatever.  That is council’s job.

Mayor Anderson thought it was a little bit of an exaggeration from Councilman Strickler for her to say that Bob is suggesting they raise water rates 25 percent.  H. Strickler said it was 20 percent over the last two years. Mayor Anderson said the point is the enterprise funds support themselves by the fees that are put in place; the rate structure to provide those services.  So, what Bob just explained is correct.  If those enterprise funds are not paying their due bill then taxpayers are paying that due bill and some of the taxpayers that are paying that aren’t receiving services from that fund.  So, the point of that ordinance is to put in place a bill to those enterprise funds for the services they are getting from people that are paid for in the general fund because that is what enterprise funds should be doing.  They should be paying their costs based on the fees that are being charged.  “Our problem is that we don’t have fee schedules in place that support the costs in those funds.”  So, we are faced with a situation right now where council has just passed a 4-1/2 percent rate increase in the sewer fund, which is inadequate.  “Now, if we hold to that line of logic there is going to be no reason to increase fees or rates in that fund to pay their bill to the general fund, so I think that’s the concern that we do charge those enterprise funds for the services that they are truly receiving.” 

Craig Fortner of Shadylake said it’s not any secret that he is totally against this ordinance.  He asked how much is the mayor’s salary or the service director’s salary is contributed to this transfer.  J. Gabriel stated that it is 25 percent of the annual salary of all these different named municipal officials, and then 25 percent of the annual salary to the sewer fund.  C. Fortner said, “Am I led to believe that this administration spends 50 percent of their time on these two funds.  Absolutely not!”  “That’s prosperous.  That’s ridiculous.”  In addition, they heard the rate structure doesn’t support it and he thought Councilwoman Strickler is right on point.  “What are you going to raise it to?”  “You raised it 10/11 percent over the last two years and you’re talking another 10 percent.”  He said they are still not able to meet the debt structure.  He stated that they have heard from Wayne Hamilton from the auditor, which said the city’s debt is out of control.  So, if you’re going to take more money out of these funds and supplement the general fund, then what are you going to do.  You’re going to have to borrow more money and then you have to keep continually raising rates.  You’ll never be able to do any projects and never be able to pay for them.  He said they are looking at funds now that are in the negative and this is after a 10/11 percent increase over the last three years.  He asked what the factual amount is that the rate structure doesn’t support.  What is the rate structure that would have to be increased to provide for the debt and to provide for this ordinance.  He said he would be curious to hear that number.

S. Holovacs said it was no secret that they were in the negative and were running low in the water and sewer. He said if they take away that 37 percent of loss water then what point are they wasting money that way.  He said if you start adding up the losses this may be why those funds are not making money.

B. Brady said she looks at the huge part of the problem as being the debt.  Without the debt, the funds are probably fairly stable, but when they look at $400,000 in debt and making a $200,000 interest payment this is huge.  This comes from years back.  This isn’t debt that they incurred last year or from the year before.  It goes back into the 1980’s and they are just accumulating and accumulating and she doesn’t think any of them run their home on a debt.  Most of them probably don’t because they plan ahead. If they’re going to buy a car they start saving today to buy a car in three years.  This is what they are not doing in these funds and as much as she hates the idea of raising taxes, they have to get these funds on stable ground, so they have to get rid of the debt.  She said she knows it sounds like a joke that they will lower rates at some point in time, but if they are running on today’s dollars maybe they will be able to afford that.  She said maybe they should set up a capital fund.  She said they have residents that leave for the winter that are taking advantage of the fact that they are improving the sewer plant, but they’re not paying into that for months out of the year.  She said this is a piece that all of them should fund whether they add $1 or $2 for a capital expense fund and keep their rates stable.  Maybe that would help with this by spreading it out a little bigger.  She agreed that the 50 percent of the salaries are too high, but thinks they do have to make some type of a transfer to keep these enterprise funds on their own.  She said she is guessing that the administration can also refuse to let the enterprise funds use the engineer and at that point it’s going to cost them a lot more money.  J. Gabriel asked her if they were going to start paying water and sewer bills then.  How far down the road are we going to take this?  He said they are getting way of track of what his intention is.  He wants to take an ordinance on the books and have council look at it every year to see if it is feasible that year.  B. Brady said it shouldn’t be feasible but reasonable.

F. Ostrander noted that the engineer bills his time out so that everything is specifically.  

H. Strickler said if they take half of everybody’s salary, with leaving the engineer out, this is $120,000 in salaries and they are not doing this now and it isn’t feasible to say that they can pay that much back every single year.  She said they have an ordinance that really isn’t being followed anyway so what is the point of having it.  She said it is used when the have a shortfall and they transfer the money when they need to make up a deficit in the general fund, and that’s not the purpose of the ordinance.  J. Gabriel said his hope is to take this ordinance and look at it at a year to year basis.

Mayor Anderson wholeheartedly agreed with reworking the ordinance.  It should be reasonable not feasible. She suggested reworking the percentages.  She said at no time have they raided those funds to balance the general fund.  She thought this was done in previous administrations but they have not done that.  That is not the intent of those administrative costs. She said rework it and come up with percentages they think are reasonable and then they should be responsible and make sure that they have rate structures in place to support those services.

H. Strickler MOVED; J. Gabriel seconded to recommend to council to amend Ordinance 74-104 that city council would review this ordinance every February to look over the transfers and to authorize the transfers, and they have to be transferred by December 31 of that same year.  Vote 3 YEAS.  MOTION CARRIED.

TOPIC FIVE:  Review of Ordinance 2006-73

J. Gabriel stated that Ordinance 2006-73 falls along the same line.  It establishes 60 cents for administrative fees and he is asking for the same consideration.  He stated that he was surprised that this has been building up for years and then it was transferred under postage without any input from council whatsoever.  In fact, if he hadn’t looked through the green bar there would have been a good chance that it would have gone unnoticed.  To him this is wrong because any time a chunk of money is moved between accounts then council should be aware of it, and they should be the ones saying this is how you do it and you have our blessing.  He said to him he doesn’t know how they move money between funds like this without council approval and if it’s based on an ordinance back in the day, they should be on board with these transfers and know what exactly is going on because council is in charge of the money.

B. Brady felt differently about this because this is a more black and white issue because they are collecting exactly 60 cents and they know exactly what the 60 cents is for.  She thinks the error is that it’s not regularly transferred and they should build this into the ordinance that on this date that the amount of money in the fund is transferred to a specific place, whether its postage or whatever.  She said they should set this rather than reviewing it every year.

J.Gabriel said in this case the money was transferred to the water fund from the sanitation fund.  B. Brady said they should decide where it’s going to be transferred.  J. Gabriel said without any appropriation or wording from council this is the direction it goes.  He said if they are truly talking about splitting the meter reader and the people who work in the water and billing office between sewer and water, and then technically didn’t half this money belong to the sewer department.  H. Strickler asked much the transfer was for.  J. Gabriel said it was $150,000 and it was listed under postage. 

S. Holovacs said he didn’t have any problem with amending this ordinance but he wanted the administration to come back every year with an appropriation ordinance to tell council where this money is going.  He said they have been doing it way for years where at the end of the year they are short and they are transferring money.

B. Sasala said that the finance director had talked to council about the method to balance the water fund this year and he spoke of transferring that $150,000.  S. Holovacs said he pulled this at the last minute though.  J. Gabriel said this wasn’t brought to council or brought out in the open as to how they were going to do this.  It was done and he found it in the green bar and actually went to Wayne and asked how the $150,000 for postage was possible.  He said that Wayne told him that it wasn’t really postage per se; it’s the administrative cost of billing over the course of a number of years.  B. Sasala said the water fund has carrying the brunt of the transfers to the general fund on the other direction.  Back in 2005, in the final appropriation bill there was $191,000 transferred from the water fund to the general fund to pay the bills.  He said the water fund absorbed all of that debt in that year.  The transfers to the general fund in the last five years have been mainly coming out of the water fund.  The sewer fund really owes the water fund if they want to split it up again.  He said this is something that hasn’t been consistent and it should be.

B. Brady said they should decide where the money should go and split it up between two funds.  H. Strickler said from the 60 cents collected they should put half to water and half to sewer.

H. Strickler MOVED; J. Gabriel seconded to recommend to council to amend Ordinance 2006-73 that by December 31 of each year, 50 percent would go to the water fund and 50 percent would go to the sewer fund.  Vote 3 YEAS.  MOTION CARRIED.

No further discussion was heard, therefore, Chairman Gabriel adjourned the meeting.

Next Meeting:  April 14, 2008 at 7:00 p.m.

Note: Unofficial meeting minutes.  Changes may be pending.

3/19/08

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