LEGISLATIVE, FINANCE, AND ADMINISTRATION COMMITTEE
The Legislative, Finance, and Administration Committee meeting was held on July 13, 2009 at 6:00 p.m. with Chairman McGlumphy presiding. Members present were Mr. Leary, Mr. Salters, Dr. Jones, and Mr. Shevock. Members of Council present were Mrs. Williams, Mr. McGiffin, and Mr. Hogan. Mayor Carey was also present.
AGENDA ADDITIONS/DELETIONS
Dr. Jones moved for approval of the agenda, seconded by Mr. Leary and unanimously carried.
Review and Recommendation - Filling of Critical Positions
During their meeting of February 23, 2009, members recommended approval of the Hiring Freeze for Fiscal Year 2008-2009, but to allow the hiring of critical positions through the review and approval of the Legislative, Finance, and Administration Committee and City Council. It was suggested that there be a “standing” agenda item to consider the filling of critical positions and, if there are no positions to consider, the item could be removed.
Mr. McGlumphy noted that there were no critical positions to be considered; therefore, no action was required of the committee.
Elimination of Medicare Part B Reimbursement
Mrs. Mitchell, Controller/Treasurer, reminded members that the Governmental Accounting Standards Board passed an accounting standard which requires governmental entities to recognize the cost of retirement health care during the term of the employee’s employment and not pay as you go after the employee retires.
Mrs. Mitchell advised members that one of the benefits the City currently provides is reimbursement of the individual’s Medicare Part B premium that is deducted from Federal Social Security or disability benefits. After researching how other governmental entities in Delaware address Medicare Part B premiums, staff discovered that the City of Dover is the only employer that provides this reimbursement. She stated that in 2006, upon learning of the draft standard and completion of a preliminary actuarial analysis, the City included in their Union negotiations the elimination of this benefit. Mrs. Mitchell stated that all unions have subsequently agreed to the elimination of the premium reimbursement for their current membership. In January 2009, the City Manager submitted benefit changes for non-bargaining employees so that they would have parity with the Unions. The elimination of the Medicare B premium reimbursement for non-bargaining employees was not included in that submission.
Mrs. Mitchell provided members with four (4) alternatives, as completed by the Actuary, to incorporate all other persons not currently represented by a Union. It was noted that the alternatives can stand alone or be combined.
Mr. McGlumphy noted the complexity of this issue and suggested that staff only address alternative #1, suggesting that alternatives #2, #3, and #4 be tabled until receipt of the Consultant’s Report.
Mrs. Mitchell explained the alternatives, as follows: Alternative #1 would provide for no reimbursement to all future retiree’s (new hires) upon approval by Council; Alternative #2 would align benefits and bring parity to all employee groups by January 31, 2010; Alternative #3 would be to continue the practice and place a $100 cap on reimbursements, except current union membership where applicable; and Alternative #4 would provide no reimbursement for all current and future retiree’s not receiving Medicare B medical benefits as of January 31, 2010, except current union membership where applicable.
Mr. Tim Mullaney, 88 Marietta Drive (retired 1992 from City of Dover Police Department), stated that upon his retirement he was advised that he would be provided Medicare B when he became eligible for its receipt. He requested that Alternative #4 not be considered a viable option.
Mr. Les Blakeman, 209 Falmouth Way, reminded members that there are two (2) classes of employees that would be affected by a change: represented employees and non-represented employees. He explained that the non-represented employees have always been able to put their full trust and reliance on Council action to protect their benefits. They do not have the benefit of a written contract, only an agreement. Mr. Blakeman noted that there are 70 individuals listed on the retirement list who could be impacted and that it could result in a 27% reduction in retirement pay. For a retiree receiving $29,397, the elimination of the benefit would result in a 3.4% permanent, on-going, cost of living reduction that would increase each year, which he explained could be detrimental when there is no built-in cost of living increase to off-set expense increases in future years. He explained that any change would establish a guaranteed reduction in retirement benefit every year.
Mrs. Frances Hettinger, 63 Sackarackin Avenue, advised members that she currently receives the Medicare B reimbursement. She explained her concern with the City taking a benefit away from a retiree who has been depending on the benefit. Concurring with Mr. Blakeman, she felt confident that Council would protect the benefits of current employees and retirees, indicating an understanding with implementing a change for new hires.
Mr. Leary moved to recommend approval of Alternative #1, which would provide no reimbursement to all future retiree’s upon approval to be effective upon approval by Council, noting that this alternative refers specifically and only to new hires. The motion was seconded by Dr. Jones and unanimously carried.
Mr. Leary moved to table Alternatives #2, #3, and #4 until receipt of the Consultant’s Report, seconded by Mr. Shevock and unanimously carried.
Mr. McGlumphy noted that, in addition to the consideration of the four (4) alternatives for future Medicare Part B premium reimbursements, staff also recommended authorization to solicit a Request for Proposal for a Health Care Consultant to assist the City with options for managing its health care costs.
Mr. Leary moved to recommend authorization to solicit a Request for Proposal for a Health Care Consultant to assist the City with options for managing its health care costs, seconded by Mr. Salters and unanimously carried.
Responding to Mr. Leary, Mrs. Mitchell stated that it is staff’s intention to involve all parties, including retirees, by scheduling workshops and requesting their review.
Revenue/Cost Saving Ideas Submitted for Consideration (Items #1 - 10)
Mr. McGlumphy advised members that he was provided a list of revenue/cost saving ideas developed by employees. He noted that the 30 suggestions would be considered by members 10 at a time (items #1-#10 at this meeting, items #11-#20 at the next, and #21-#30 at the following meeting). He reminded members that, during their meeting of May 19, 2009, Council reviewed the budget for Fiscal Year 2009/2010, which included a budget shortfall in the amount of $986,781 (across all three funds). In light of the shortfall, Mr. Kenneth Clendaniel, along with the IUE, provided a list of suggestions to save money and increase revenue throughout the City of Dover.
Mr. DePrima, City Manager, advised members that he received the list directly from the Union representatives several weeks ago. After reviewing the list with the representatives, he indicated that he would review the list with various department heads that would be impacted and would keep them apprised of the progress. He also advised them that there was nothing on the list that he felt would cause him to alter the budget. However, some of the ideas, if implemented, would certainly increase revenue and/or reduce expenses. Mr. DePrima felt that it was important to note that this list was not vetted by the Union leadership and that any idea expressed by a member was added to the list. Although some items on the list would not require anything more than his approval or the approval of a department head, he noted that there are other items, such as the various suggested fee increases, that would require Council approval.
Staff recommended that the full list be referred back to the City Manager for consideration and further handling. Mr. DePrima requested that members provide guidance by indicating those items that members find particularly interesting and those that they find utterly unappetizing. He assured members that he would keep them updated on the status of the ideas.
Mr. McGlumphy explained that due to concerns regarding communication gaps between employees, the City Manager, and City Council, members will be discussing the suggestions publicly, as follows:
#1 - For scheduled appointment no shows for inspections, fines should be issued ( $50.00 fine 1st offense, $100.00 each additional offense)
Mrs. Townshend, Director of Planning and Inspections, explained that there have been instances when property owners have not showed up for their housing inspection for their rental properties. To her knowledge, summonses have been issued when there have been “no shows”. This is something she felt could be handled administratively within the department.
#2 - Code Violations and Housing inspections- If violation is not corrected within 30 days a $50.00 re-inspection fee should be assessed for second inspection in addition to any summonses issued
Mrs. Townshend advised members that although a re-inspection fee for construction inspections is codified, an ordinance would be necessary for a re-inspection fee for violations.
At the request of Mr. Salters, Mrs. Townshend indicated that she would provide correspondence received from the Deputy City Solicitor indicating that an ordinance cannot be considered that would allow for the fee to be included as a lien on the property and included on the property tax bill. Mr. Salters suggested that a formal legal opinion be obtained regarding this issue.
In response to Mr. Leary, Mrs. Townshend advised members that these outstanding summonses have just recently been forwarded to the Administrative Services Department for submission to the collection agency. Since this was just recently accomplished, she suggested that staff report back in approximately six (6) months in regards to the results of these collection efforts.
#3 - Stronger collection method to collect unpaid summonses (60-65% of all summonses are unpaid)
Mr. McGlumphy noted that the previous discussion will address this suggestion.
#4 - More enforcement of fire lane and handicap parking
Mr. DePrima suggested that the Police Department provide statistics regarding these violations.
#5 - Enact a yard sale/garage sale permit. (Most other communities charge $5.00 fee)
Mrs. Townshend explained her concern with enacting a yard/garage sale permit is that these events are typically held during the weekends when there are no inspectors available to enforce the permit. It was her opinion that requiring such a permit would either not be fair for those that do obtain a permit or that the City would be paying over-time or comp-time to provide enforcement; therefore, this suggestion would not be cost effective.
#6 - Enact chronic nuisance property ordinance that includes higher violations fees for those who are chronic violators. To include press releases of problem properties and also implement a program that will have the city repair the violation and place a tax lien on the property for the cost. Properties classified as "chronic nuisance" will not be able to re-new rental permits with large amounts of unpaid violations (this will avoid mailings and casework)
Mrs. Townshend advised members that staff is currently working on addressing chronic violators and noted that staff has not confirmed that an ordinance is necessary, explaining that staff has been re-structuring fines that would differentiate between chronic violators and others. As an example, she stated that there are property owners that are provided summonses for grass cutting on a regular basis and that these fees are placed as a tax lien on the property.
#7 - All unpaid fines and fees should be paid through a tax lien on the property
As previously mentioned, Mr. Salters stated his desire for a proposal that would allow for unpaid fines and fees to be included as a tax lien on properties.
#8 - Charge additional fees for copies of violations, permits, maps, etc.
Mr. DePrima advised members that the fees for copies are set by the City Clerk by determining the City’s costs for producing copies. He explained his concern that it sometimes is not worth the time and effort to collect small fees since the costs to administrate such collections would be more than the actual fees collected.
#9 - Increase late fees assessed for all rental and business licenses that are not renewed by the renewal date, in additions to any other fees or fines
Mr. DePrima reminded members that during a past Retreat, members of Council had indicated a desire to consider revisiting fines and permit fees proposed by staff. He stated that staff intends to present recommendations which will include late fees.
#10 - Require merchant licenses at all events on the Green. (Old Dover Days, African American Festival, 4th of July, Art Festivals, or even Music Venues on the Green)
Mr. DePrima stated that organizations that are holding events actually charge a fee to participate. A policy was established several years ago that if the merchants participating in the festival were paying a fee to the festival organizers, then the City would not charge a fee and explained that this was the City’s effort to support such events.
Referring to items #1-#10, Mr. McGlumphy requested that staff develop policies or ordinances that can be enforced, along with recommendations regarding the 10 ideas submitted by employees.
Phase II of the MAG Study
During their meeting of June 22, 2009, staff provided a handout containing an Organization of Recommendations related to Phase II of the MAG Study with proposed changes grouped according to subject area. Mr. McGlumphy reminded members that there would be no action taken on the matter at this time and that the study will continue to be returned to the table until all six (6) exhibits related to the report can be reviewed.
Mr. Leary moved to remove the matter from the table, seconded by Mr. Salters and unanimously carried.
A continuation of an overview of the Organization of Recommendations was presented by Mr. DePrima and Mrs. Hawkins, as follows:
Grading Definitions
Mrs. Hawkins explained that MAG 5, 6, and 7 recommendations are definition changes for performance labels.
Council Evaluations
Mr. Leary felt that there should be no changes to the manner in which evaluations for Council Appointees are accomplished, which involves all members of Council.
After much discussion, Mr. McGlumphy requested that staff prepare a committee action form regarding the manner in which evaluations for Council Appointees should be accomplished. Mr. DePrima suggested the inclusion of a recommended change in the review of employees’ goals to better coincide with the presentation of the budget.
Mr. Leary moved to table the matter until the next meeting, table, seconded by Mr. Salters and unanimously carried.
Mr. Leary moved for adjournment, seconded by Mr. Shevock and unanimously carried.
Meeting Adjourned at 6:59 P.M.
Respectfully submitted,
William P. McGlumphy
Chairman
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