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02 City Council (8/26/03)MINUTES OF THE REGULAR MEETING OF THE CITY COUNCIL AUGUST 26, 2003 The City Council of the City of Paris met in regular session, Tuesday, August 26, 2003, 6:00 P.M. at Paris Junior College, Bobby R. Walters Applied Technology Building, Room 1206, 2400 Clarksville Street, Paris, Texas. Mayor Curtis Fendley called the meeting to order with the following Council Members present: Jim Bell, Joe E. McCarthy, Francine Neeley, Willie Weekly, Sr., and Benny Plata. Also present were City Manager Michael E. Malone, City Attorney Larry W. Schenk, and City Clerk Mattie Cunningham. Mayor Fendley announced that the special meeting was called for the purpose of having a budget workshop session. Mayor Fendley called for receiving input from interested citizens of Paris proposing services or projects to be included in the 2003-2004 City of Paris Budget. No one appeared and the City Council moved into the budget workshop. Mayor Fendley announced that the first department to be considered was the Warehouse. Mr. Anderson passed out a budget narrative and the budget for the Warehouse and advised it is actually down from last year. Mr. Anderson said he would like to focus on the Water Billing Office. He said on Page 235, Account No. 10-02-9-81-00, Minor Apparatus, that the thousand dollars is for a phone tree set-up. He explained that it is an automated dialing set-up utilizing a PC and it is a software item. Their intention is to reduce delinquent turn-off lists. At a certain point they would download the information, and call persons who are delinquent reminding them to pay their water bills before service is discontinued. Mr. Anderson said there are no complaints on the paper notice except that some people say they do not receive the notice. He said they are just trying, with the reduction of one meter reader, to keep the cut off list as small as they possibly can in order to physically be Regular City Council Meeting August 26 , 2003 Page 2 able to turn them on and turn them back on the same day. Mr. Bell asked if we would be affected by the no call list. Mr. Anderson stated that the city is not selling anything. This is a reminder for the citizen to pay the bill before the water is cut off. Mayor Fendley questioned accounts 10-0398 and 10-0399, franchise fee and an administrative fee. Mr. Anderson advised that the administrative fee is the amount of money that is transferred from the Water and Sewer Fund to the General Fund for the services that the General Fund provides and he normally waits until the end of the year to do that transfer. Mr. Anderson advised that the utility franchise fee is exactly that. It is a 3% franchise fee. Mr. Anderson said some of the utilities pay the city 4%, but the city transfers 3% for the city's utility fund. Mr. Anderson said the top line item on Page 236 (10-0217-800, Furniture & Fixtures Minor) has $6,500.00 for the purchase and installation of a new drive through window for the water office. He said the current window was purchased used in 1986 and both the speaker and the drawer are worn out. He advised that he repairs it all the time and it will not hold up. Mr. Anderson said Account No. 10-0318-81-00 is for Consultants in the amount of $30,000.00. He said that $25,000.00 of that is for a water and sewer rate study. We have talked about updating that every year and that is the reason he placed $25,000.00 for this service and it should be more than enough to do that on an annual basis. Mr. Anderson said the other $5,000.00 is for a portion of that Performance Plus, Inc., Training, and as it has been removed from the General Fund and he is assuming that the Council will remove it from the Water and Sewer Fund. Mr. Anderson said the item that Councilman Weekly asked about is 10-0510- 81-00, Electronic Data Processing, on page 237. This includes ordinary hardware and software maintenance, training, and the lease of billing and Regular City Council Meeting August 26 , 2003 Page 3 collection software totally $10,500.00. The remaining cost of $49,000.00 provides the city the ability to allow utility payments via the Internet or via phone. It also allows customers to receive their account on a real time basis. The cost is being provided because the previous Council desired the staff to be proactive in the areas of e-government. It is strictly an optional item. He said he did not feel it was cost effective to do it, but he wanted the City Council to know what it would cost to implement this system. After discussion of this item, a motion was made by Councilman McCarthy, seconded by Councilman Bell, to cut the $49,000.00 from budget account no. 10-0510-81-00. The motion carried unanimously. Mr. Anderson explained Account No. 0-0601-81-00, Water Purchase in Annexed Areas. He said Lamar County Water Supply District is still providing water to some homes inside the newly annexed areas until the city purchases the lines. The meters belong to the city. They are read by the city and the city sends the bill. The city sends the consumption numbers to Lamar County Water Supply and they send us a bill to pay for the water. This is a temporary procedure and he wanted to inform the Council why it is happening. Anthony Bethel, Director of the Paris/Lamar County Health Department, came forward explaining that the Health Department is funded by grants ~at eeme from the State of Texas that cover most of their funding. Mr. Bethel said they have fees that they collect from different services such as restaurant inspections, immunization, and what is left in their budget at the end of the year, the City of Paris and Lamar County split that deficit 50150. Mr. Anderson said there are a couple of corrections that he wanted to point out. On page 296, the revenue side for the Lamar County contribution number should have been $160,157.00 instead of $122,049.00 and the same thing for the City of Paris's contribution for 2003-2004. Mr. Anderson said the Bio-terrorist grant should be deleted. Regular City Council Meeting August 26 , 2003 Page 4 Mr. Bethel said the only thing that may change in their funding may be because last year they received $50,000.00 for immunization. Mr. Bethel advised that he had just turned in a new grant that should be funded by January 1, 2004. If they receive that grant it will be for $221,000.00, which may increase the immunization revenue. Mr. Bethel informed the Council that the state is going to stop auditing the immunization records at the schools that they give and if we get this grant, the Health Department will have to do that. He felt that he would only have to add one person to do the work. Mr. Anderson advised that the revenue account for the immunization grant should go to $66,697.00 and this is just for a four month extension that they gave the Health Department. Mr. Bethel said they have a lot of things in their budget and they may take $2,000.00 out in one place and move it to another place. Once a year the state requires them to do a time study to come up with a weighted figure on how much times was spent on certain activities such as immunizations. Mr. Anderson advised that the grants are restrictive and are for specific medical services. The state audits every year and if money has been spent on the wrong thing the Health Department will be asked to give the money back. Mayor Fendley asked if the employees of the Health Department fall under the city's work plan. Mr. Anderson advised that the Health Board voted several years ago to ask the city to allow them to come under our plan and the City Council voted to allow them to do so. They follow our personnel policies and pay plan, but they pay their own way in regard to insurance. Mr. Anderson said he is allowed to charge 10% of the salary number for AC only for doing their accounting. The amounts to $10,000.00 to $12,000.00 a year. Mr. Anderson said he had determined that the electrical expense for Woodall Baseball Park was $10,666.00 for the last twelve months. This number is in the Parks and Recreation budget. Regular City Council Meeting August 26 , 2003 Page 5 Mayor Fendley told the City Council that they still had time and if they had anything they would like to make any recommended changes on that they would like staff to look at tonight, they could give that to them so they could start working on amending the numbers. Councilman Plata said that Mr. Anderson has budgeted $25,000.00 for consultants for doing an annual Water and Sewer Study, but he did not remember anyone saying they wanted to do that annually. Mr. Anderson advised that it was discussed and staff recommended that it be done every year. Mr. Anderson said as they discussed last night, the direction that they are going on the Campbell Soup negotiations is essentially wiping out the last rate increase that was approved at the direction that the city is heading. Mr. Anderson said it needs to be looked at again next year and he felt the $25,000.00 would cover the cost. City Attorney Schenk advised that in the negotiations with Campbell Soup, they have requested that the contract provide the city to have some type audit and study every year and incorporate that into the rate structure because the city will be doing annual adjustments now, rather than the way the city was doing before, which was every three years. He said they were going to have to have some basis to doing that. The City Attorney said the way Campbell Soup has asked for this contract to be done, it is going to be based on peaking factors that they are going to collect. Based on their performance during that year the city will have to do a minimum amount of calculations to determine what the peaking factor should be for the following year. Mayor Fendley wanted to know if rate studies are required by law. Mr. Anderson said they were not required, but what you get into is having to prove it first. City Manager Malone advised that a rate study is part of the cost of furnishing water. Regular City Council Meeting August 26 , 2003 Page 6 After discussion, Mayor Fendley said that they can discuss this with Campbell Soup and clarify that with them. Mayor Fendley said he would like to discuss employment benefits regarding health coverage. He said that the city has gone from paying $290.00 per employee to $500.00 per employee. He said he did not see how they can budget this type increase. The Mayor said there could be a happy medium in there somewhere. They need to decide what number the city is going to pay per employee, such as $450.00 or $425.00, and then go back and look at our plan and possibly change benefits. He said that is what everyone is doing. They are either reducing their benefits or employees are participating in the cost. If you cut it to $425.00 or $450.00 there would be a$300,000.00 savings. He said he would rather do that and give another 1% raise than look at the figure on the health benefit side because some people do have high medical costs. Mayor Fendley said he would like to see some numbers run on that, and set that money aside in the contingency fund and see what they can find in a benefit plan. Mayor Fendley said that he had checked with the hospital here and they had to do the same thing. They were on a self-funded plan and they have gone to where the employees have the 90/10 plan they pay 25% of that and if they want to go with the 80/20% plan, the cost is different. Mr. Anderson said he was expecting preliminary numbers any day now from TML. He advised that he had asked them to look out of the network and asked them to look at 80% in and 50% out. Mayor Fendley said that the largest savings are your co-pay and drug card. He would like to see some numbers on that. Councilman Plata said he would like to take a look at the 2 for 1 on the pension plan and see if something could be cut down some, even ifyou go down to 10% where it is 12%. He would like to see the savings that it would produce. Councilman Plata said that is still high compared to what businesses are paying Regular City Council Meeting August 26 , 2003 Page 7 right now. He said they do not put in near that much and they are not compensated near that much. Mr. Anderson said the trade off is how the city competes with industry because the city cannot compete salary wise with industry but with the benefit plan and that is how the city retains employees. Anyone can go out to Campbell Soup and Kimberly Clark and make a lot more money than working for the city. If you reduce the benefits significantly, the city will lose any ability to retain employees. Councilman Plata said he would like to see the difference it would make by going back to a 5110 match. Councilman McCarthy asked if they just went to the 6% this year. Mr. Anderson said that is correct and that is the most requested thing from the employees in terms of what they wanted, if they could have anything they wanted. They wanted to be able to contribute more to their retirement. Councilwoman Neeley said she would like something to be looked at where there is just not across the board percentage raises because the employees on the bottom are not seeing very much on their check. Councilman Guest entered the council chambers at 5:58 P.M., and assumed his seat at the council table. Mayor Fendley brought Councilman Guest up to date on what departments they have gone over and recommendations that have been made by the Council. Councilwoman Neeley departed the council chambers at 6:00 P.M. Mayor Fendley said Councilwoman Neeley was referring to the step and grade plan the city is currently under. He thought the new Human Resource person could look into that policy. Regular City Council Meeting August 26 , 2003 Page 8 Mr. Anderson said the City of Paris is not an exception to the rule when you look at all the cities who participate in TMRS. Councilman Bell asked if they could furnish the Council with information on what cities in TRMS are in 2 for 1 and 6% or 7%. Mr. Anderson said he has a book that has it in there. Mr. Haynes advised that he was working on that right now and two or three of the cities are at 2 for 1 and 7% and he has not seen any that are not 2 for 1. He has seen only one city that is at 5%. Mayor Fendley announced that the City Council would take a short break at 6:03 P.M. Mayor Fendley reconvened the meeting at 6:14 P.M. Mayor Fendley said that the next Department for consideration would be the Utilities Department. Herb Campbell, Director of Utilities, explained that in his departments they start the budget with a clean sheet of paper. They go back and make estimates on what they think it it going to take to operate each division for the coming year. Mr. Campbell said that Department 82 is going to be down with a negative 3.1 Department 86 is going to be down in the operating end by 3.6% and the lift station is down 0.9%. He said if you put in capital improvements in Department 86, which is the Wastewater Treatment, it is going to be up a total of 2%. Mr. Campbell said they have cut one person in each of his departments, which were vacant slots. He said that some of the good news is that the lost water in the city has gone Regular City Council Meeting August 26 , 2003 Page 9 from 17% to 11 That will translate into a savings of about $140,000.00. Mr. Campbell said in addition to the lost water being down, it looks like Lamar County is now paying the full amount. They were selling more than they were buying for a good while last year, but now they are back to buying 9.2% more than they are selling. Councilman Guest asked when the city buys the lines from Lamar County Water Supply, what impact will that have on our residents. Mr. Anderson advised that they have some of the revenue that they are still serving with their meters, so it is not a full conversion over and he really cannot tell at this time. Mr. Campbell said the budgets this year are pretty straight forward, but there are a few changes that they need to make like account 10-0209 on page 241. If you will notice, in the year 2001-2002 it was about $6,000.00 and last year they budgeted $7,000.00 and it has jumped up to $13,200.00. In the past, they have budgeted minor apparatus items that were more of a capital expenditure, but since they were not over $5,000.00, Mr. Anderson moved those into this account. The maj or thing is a meter for the lagoon outfall where the water at the wastewater treatment goes and a communication upgrade. Mr. Campbell said every year they seem to add onto the existing computer system that they have. This next year they are going to add more chlorine analyzers in the distribution system and they will be hooked up to their computer system at the Water Treatment Plant. Mayor Fendley asked about the utilities in account 0308 being so high. Mr. Anderson advised that what they need to do is move $170,000.00 out of this line item and move it over to Terry Townsend's Department No. 83. Mr. Campbell said also some of the problem is the poor billing system of First Choice. Regular City Council Meeting August 26 , 2003 Page 10 Mr. Campbell discussed the chemical cost with Councilman Bell and he questioned why he had budgeted $367,000.00 compared to what he spent $240,000.00. Mr. Campbell explained that their largest chemical expense is during the hottest part of the year as that is when they produce the most water. He also explained that he has not spent all of the money for chemicals at this time. Councilman Weekly asked about Account No. 0204, Street and Alley Repairs. Mr. Campbell said they are going to spend $12,000.00 on improving the gravel road that goes to the pumping station at Pat Mayes Lake. He advised that sometimes Richard Drake spreads the gravel for them. Mr. Campbell said there is another change in Department No. 86, Page 261, Account No. 0204- Wearing Apparel, he did not catch it but the superintendent put some of that money over into the Laundry and Cleaning Account instead of Wearing Apparel and that should increase by $4,000.00. It should be $8,000.00 for Wearing Apparel and the Cleaning account 0210 should be reduced by $4,000.00 making it a total of $3,200,00. On Page 263, Account No. 0405 it shows a negative number, Screening and Landfill and that is a fee that they pay to haul off the screening which is the solid waste that comes out of the sewage and he felt that $6,500.00 would be enough to cover it. Councilman Weekly asked about Account No. 0405 Building and Grounds, on Page No. 263. Mr. Campbell said they have budgeted $15,000 to replace the asbestos roof that is leaking on the master lift station. Councilman Plata said that Mr. Campbell has two 4-wheelers in the budget and he wanted to know how they are going to be used. Mr. Campbell advised that those 4-wheelers are replacing two pickup trucks that have milage of 194,000 and 214,000 miles. Mr. Campbell explained that those two trucks were hand- me-downs from the Lift Station to the Wastewater Treatment and they are Regular City Council Meeting August 26 , 2003 Page 11 totally worn out. Mr. Campbell said currently they have five vehicles and they will be getting rid of two of those and that will leave them three. He said they have never had any four wheelers before and a lot of people are going to them. Mr. Campbell discussed the purchase of a tractor with the Council and how it will be purchased, but they will go around and get bids. Mr. Campbell said on Page 266, there is $28,000.00 for a variable speed drive for the Number 3 pump at the Master Lift Station. Mr. Campbell discussed the car in his department with Councilman Weekley. He said Environmental Services has the only department car. He said with the new rule which came up a few years ago, he drives his own vehicle and is paying his on expenses and he does not have a car allowance. Mr. Campbell said they use the city car when they go for training and different places. Mayor Fendley said they have meetings scheduled for tomorrow and Thursday night, but they had asked Mr. Anderson to run some numbers for them. It was the consensus of the Council to skip Wednesday night and meet Thursday. City Attorney Schenk presented the following petition for rezoning: Paris Historical Preservation Committee, Santa Fe - Frisco Depot from Light Industrial District to Historical Overlay District. Mayor Fendley referred the petition to the Planning and Zoning Commission for their study and recommendation at their meeting scheduled for October, 2003. There being no further business, a motion was made by Councilman McCarthy, seconded by Councilman Weekly to adjourn the meeting. The motion carried unanimously. Regular City Council Meeting August 26 , 2003 Page 12 CURTIS FENDLEY, MAYOR ATTEST: MATTIE CUNNINGHAM, CITY CLERK