Committee Minutes

MINUTES/FINANCE COMMITTEE
January 31, 1995 - 3:30 p.m.

Members present: Carpenter, Babinchak, Geller, McCabe.

1. Matter of delinquent water assessment at 1401 12th Ave.S.
Steve Akerlind stated he purchased property from Duane Knutson in September, 1993, and received assessment of $1916.55 for delinquent water bills from 1992 for Ron and Tim Badurek who rented property from Mr. Knutson and when received special assessment was first he found out about it. He noted that bills had been sent to renter and not to property owner and that Mr. Knutson was not aware of delinquent bill either; and was asking for removal of the assessment from his property. It was noted by the committee that the assessment is due in one payment.

Mr. Schmisek reviewed procedures that utility billing follows re. delinquent bills; that they were unable to collect that bill, and according to Code this bill follows property and is special assessed; that they continue to try to collect from the tenant and if do so, reimbursed to owner of the property if they have paid the bill in the meantime. He stated that normally when the tenant moves out there is a notice to the owner that the tenant left a balance and that we are trying to collect it. He noted that they then turn over to collection bureau, however, when this is done and if they collect, the City only gets 50% of the funds. He also reported new owner assigned new account number by water utility; that in previous cases finance committee has upheld.

Geller present.

Mr. Swanson advised that there is not any notice required to owner of the property, and under our Code owner of property responsible for tenant's bill. He also noted they have ability to search records at City Hall, this information available as well as assessments in process. Mr. Schmisek stated they have no specific policy as to collection time, etc.

After further discussion it was moved by McCabe and Geller to cancel the assessment and to discuss new policy.

The committee asked if they could cancel part of the assessment; Mr. Swanson stated they have ability to cancel assessment, but don't have ability to alter assessment, could require payment and then refund.

McCabe and Geller withdrew their motion; and the committee asked Mr. Schmisek to meet with Mr. Akerlind to work out equitable settlement and bring back to committee in 2 weeks. The committee also asked Mr. Schmisek to bring back policy re. timelines, etc.

2. Application for abatement of 1993 taxes by North Dakota
Automobile Club, 2701 S. Columbia Road.
Bob Simons stated he is a certified and licensed general
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property appraiser in the State of North Dakota and property tax consultant, and was appearing in behalf of Triple A who owns office building at 2701 South Columbia Road; that for the year 1993 the City valued this property at $944,900, and that they believe that value excessive, unjust and inequitable for the following reasons: that a detailed narrative appraisal made by Ray Reilly Appraisal (Mr. Anderson) indicated a value of $722,100, which was $222,800 less than the City's appraisal, and primary difference was in the handling of the physical, functional and economic depreciation on the building. He stated this building has very limited access, bi-level building with poor floor plan, and this is very measurable in the rents they are able to collect, 53% of building vacant. He stated that Reilly Appraisal measured economic and functional depreciation at 25% (City allowed 10% physical depreciation); and stated that in their research several other office buildings in the city had been given functional and/or economic depreciation on their valuations creating an inequity between competing buildings (ie., Columbia Woods, Gate City building, Columbia Center). He stated that the building owner directed him to file abatement on 1993 valuation, and appeal 1994 to the Board of Equalization and last April finance committee recommended that the value be reduced to $787,000 which was assessor's estimate of value from income approach; and they are requesting that the 1993 valuation be reduced to $787,000 which is the assessor's value based on income approach and that be made applicable to year 1993 as well.

Mel Carsen, city assessor, stated that report he had prepared in September 1994 had been included with committee's packet; stated that the main issue in the Reilly appraisal is the measuring of functional obsolescence, and reviewed report (Exh. 1 - comparison to determine possible functional obsolescence) with the committee, and distributed copies of Exhibit 2 (income approach and breakdown of potential gross income) and Exh. 3 (comparable sales) and stated that their original appraisal used a depreciation of 10% (probably should be 20%, which would reduce value to $856,500).

After further discussion it was moved by Geller and Babinchak to place the market value on the property at $856,500 for 1993. Motion carried.

3. Matter of approval of plans and specs. for parking ramp.
Mike Murie, EAPC, rep. Parking Authority, Mr. Jackson and Mr. Tingum were present. Mr. Murie reported that the finance committee and council had approved preparation of plans and specifications for bidding the ramp, and they were now requesting approval of the plans and specs., setting a bid date of March 8
and approval to publish the advertisement for bids for that date. He stated he had set of plans and specs. available; that cost estimate has not been revised substantially from previous meeting MINUTES/FINANCE COMMITTEE
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and would be doing that again before bid opening date. Mr. Schmisek stated that bids need to come in on line because they are trying to use funds left from previous parking ramp and it would appear that if at the $850-900,000 range should be able to do that but would still have to sell bonds in advance of that with the anticipation that council will approve transfer of those excess parking ramp funds each year to help pay for this project.

Don Tingum reported they have max. could go to of $925-930,000 by extending the assessment from 10 to 15 years; they will draw up payment plan for the bonds sometime after the bids opened so know if can afford project or not; that they will be meeting with Special Assessment Commission tomorrow to determine formula on bond issue of somewhere around $400 to 425,000, but that depends on how bids come in. He also stated that once formula established and bids in they plan to hold public hearing on March 9 informing all property owners within district explaining the project and how it's going to be paid for. He noted there would be no additional special assessments, unless they do not continue to pay the full amount or if the council declines from approving an annual payment for the next four years. He noted that protest period expires 17th and bids will go to the council on the 20th. It was noted that the location of the ramp is the intersection of North 3rd Street and 1st Avenue North.

Moved by McCabe and Babinchak that we pass a resolution approving the plans and specifications for this construction and further that the city auditor be directed to advertise for bids on the project with a bid opening date of March 8, 1995. Motion carried.

4. Matter of affordable housing:
a) reducing City charges for lots that would be devoted for
homes costing less than $100,000.
b) reducing 50% upfront cost for special assessments for
lower cost housing.
c) extending or increasing new home tax abatement for mod-
estly priced spec. homes to encourage more developers
to look at this market.
Mr. Carpenter reported that when they met in joint meeting with public service, the finance committee was to review and recommend any specific actions, that he is willing to put together package based on joint meeting, but would like to know whether to do for this building season or wait and see what happens in market place. He stated reason to wait is there are couple potential developments in process and see how they do and whether there is a market for that type of housing, and 2) do have Air Base closure process going again; and some arguments because of perception problem to take some action, looking for guidance. He stated that if people aren't interested in having City take some
action this year, nothing would be put together, but if want to MINUTES/FINANCE COMMITTEE
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do something this year, would try to put together plan to bring to finance that would address reducing City charges and upfront costs and tax exemptions on a targeted basis and package together to specifically assist affordable housing, and would define that within the package.

There was some discussion re. Sun Land West development, success or failure of development, whether want to develop policy and say this is direction want to move public policy in. Mr. Carpenter stated that if Sun Land West development a success, don't need package; if failure, need to know why; that if Base stays, will provide incentive for multi-family housing. Babinchak was in favor of waiting until next year to see what Sun Land does and what happens with Base. Mr. Schmisek stated he felt they were premature with this, that Mr. Schmaltz developing area, that Mr. Lamb putting together development of lower priced homes, and not anticipating any change in these policies. Geller stated that he would like to send message to developers that we want to do what can within reason to encourage some kind of affordable housing development, and what other cities doing not concern (concern is that we don't put ourselves in a position that we were in 20 years ago), but do we want to put those policies in place.

Moved by McCabe and Geller that the committee develop package this year for council consideration. McCabe and Geller voted in favor of the motion, and Carpenter and Babinchak voted against the motion. Chairman Carpenter declared that the motion failed. Mr. Swanson advised that recommendation doesn't move forward but could be brought to full council. The committee stated they could bring up Monday night as added item.

5. Matter of funding retroactive pay for reclassifications.
Mr. Schmisek reported they have three departments that have retroactive pay outstanding (assessing, streets and police) to the amount of $181,615.95, and need to do budget adjustment for 1995 for the police and street departments totaling $142,578.12, for a total of $324,194.07; that we have $50,000 budgeted in the 1995 budget for reclassification requests, for a net needed of $274,194.07. He stated he was directed by this committee to review the carryover amounts that we would have coming in this budget or alternatives, that they had talked about sales tax and Loan and Stabilization Fund, but in looking at area in general fund of wages & salaries and fringe benefits, they are carrying
forward $258,961.53 and he would suggest that be used as unanticipated funds available to fund the retroactive pay, leaving a balance of $15,232.54, and suggested that they take that from the pooled carryover amount looking at at the end of 1994 in the amount of $335,533.00; that this does not affect any of the individual departments and is more of a pooled amount that comes out of the Misc. Fund budget in the general fund. Mr. Carpenter stated this is provides committee with opportunity
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without having to take out of any individual department budget or tap special sources of funds.

The committee stated their concerns that significant amount does apply to one department and they are not having to come up with any funds; also concerns that grade level change approved by Civil Service prior to first and second reading of the final budget approval for 1995 and they weren't informed of that by the departments; that departments need to be more careful when things are approved and council not informed when in budget process and have significant ramification on the budget; need to make departments more responsible/accountable for their budgets. It was also noted that if not for this would have funds available for other things, and could be used as additional carryover or spent in preparing 1996 budget. Mr. Schmisek noted that other departments had reclassifications that were funded and impacted other budgets, and not fair to change policy now, set policy in the future; 40 employees in fire department reclassified in 1992 and were funded. Mr. Carpenter stated they need to fund this way, but message is that if departments support reclassifica- tions, and reclassifications can be justified and approved by civil service, but department may have to recognize that they may have to find different ways to cover that cost through reduced equipment, maint. and operation or number of employees within the department.

Moved by Babinchak and McCabe to fund the retroactive pay from sources identified by Mr. Schmisek. Motion carried.

6. Matter of Civil Service Code amendment allowing employees
with break in service due to on the job injury to retain
seniority (and other benefits).
It was noted that this involves one employee, Jeff Kavadas, police department. Mr. Swanson reported that the ordinance has been amended and Mr. Kavadas is asking for adjustment in pay scale, prior service and any re-employment changes, and that he be granted benefit of having additional seniority. Mr. Kavadas stated that request was to make retroactive to July 1, 1987, and Mr. Swanson advised that he would not be able to take advantage of that for any promotional activities or re-assignments that may have occurred.

Moved by McCabe and Babinchak to grant retroactive pay, both in
terms of step increase and vacation accrual and longevity, and that in all future personnel decisions that he be given credit for total years of service.

Carpenter asked how funded; Mr. Schmisek stated they would have to look at it and determine funding source. Mr. Kavadas stated
amount was approx. $6600. Dan Gordon stated he couldn't assume figure, and would have to re-calculate. Mr. Carpenter stated
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that if can't find other funds, may have to take from carryover and use reclassification money for this, and increase $15,000+ to $21,000. Mr. Schmisek stated they could transfer funds from the Contingency Fund.

Upon call for the question, the motion carried.

7. Matter of clarification of City Code re. holiday pay (Section
6-0402(3).
Dennis Koback, PSAP, requested that the wording from the old civil service code pertaining to shift employees, be reinstated in new Code; that under new Code person scheduled to work holiday would be able to call in sick, receive their sick leave pay in addition to holiday pay; that in past practice it has been that person receiving holiday pay not allowed to receive sick leave or vacation pay. Mr. Swanson reported that they had eliminated prohibition on combination of vacation or sick leave with holiday pay; that it was a specific decision by the review committee to delete that restriction. Mr. Swanson stated that no one is eligible for triple time for the combination; and that review committee questioned why shouldn't employee be able to combine holiday time with the use of sick leave or vacation because as an employee are depleting an asset, and there was no discussion at that time from any of the departments that in changing the code there would be an inordinate impact; the committee did debate; and their office doesn't take position. He stated for example there is inequity for shift employee taking long weekend over holiday over non-shift employee; but Mr. Kobach stating they have problem when someone calls in sick, can't get anybody to come back to work. Mr. Swanson stated this is policy decision and only affects shift employees. Chief Aulich and Hazel Fetters-Sletten stated they would support old policy.

Mr. Swanson proposed that if the committee wishes to move forward and adopt that policy that they be allowed to draft proper language to be placed in the present Code, that the committee move forward and introduce an amendment to Section 6-0420, Holiday Pay, to provide for the exclusion of holiday pay for employees utilizing vacation or sick leave. Moved by McCabe and Geller.

There was some discussion re. proration of holiday pay if for some reason the employee only worked part of the holiday. Mr. Swanson stated that an employee eligible for 8 hours of holiday pay. Motion carried.

8. Matter of amendment to City Code re. payment of sick leave
upon termination of employment.
Mr. Swanson advised that they have identified series of minor
errors and modifications to the Code they are proposing to bring forward in a technical corrections ordinance. Mr. Schmisek
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stated there was concern that if employee should terminate prior to getting the ordinance changed; and Mr. Swanson stated those corrections would be adopted with a retroactive date of January 1, 1995. Hold for final form at next meeting.

9. Matter of part-time employees receiving pay for scheduled
holidays.
Mr. Schmisek reported this came up at department head meeting and it was more of a question of clarification. Mr. Swanson stated that if a permanent part-time employee worked on a holiday they would be entitled to time and a half for actual hours worked; if there's a permanent part-time employee not working on a holiday they are entitled to holiday pay at their normal rate pro-rated to the number of hours they would typically work. He stated that perhaps they need to draft a section to put into the civil service code dealing specifically with the benefits for permanent part-time employees, and they would draft. This was to enhance compensation for those classified as permanent part-time, gives additional benefit on pro-rated basis.

Donna Bernhardt, health department, stated she works 66% of full-time; and stated that University and United Hospital give pro-rated benefit to part-time employees.

It was noted that temporary positions are to be reviewed on annual basis.

Don Shields expressed some concern re. using 1994 as basis for determining benefits, as there may be change in number of hours working in 1995. Mr. Schmisek stated concern if use 1995, where
start, or how determine benefits.

After further discussion it was moved by Geller and McCabe to receive and file.

Mr. Carpenter asked that at the next department head meeting that Mr. Swanson be there to explain intent and respond to questions
and specific circumstances. Mr. Swanson stated he was at last meeting, there were questions and he is open to discuss further.
Mr. McCabe stated he has concern with employees attending long meetings with pay, and will bring up at next council meeting.

Motion carried.

RECESS FOR 5-MINUTES/RECONVENE AT 6:10 P.M.

10. Feasibility of including management of police building under
same management as City Hall and civic auditorium.
Ann Sande, 1110 Belmont Road, member of public safety committee, presented possibility of changing responsibility for
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management and maintenance of police building to those in charge of City Hall and civic auditorium. She stated that she has spoken with police officer (when went to take first ride with police that the animal warden was doing the floors) and when made inquiry as to how building run and managed, that one of the police sergeants, Byron Sieber, is the building manager (and also responsible for records management, computers, etc.) and she would like to see more time for policing and by relieving police department of building management function, give them more time for policing. She stated that she would like to see maintenance functions included with management of two other buildings; central purchasing, and thinks it would be good idea for City to establish Bldgs. and Grounds Dept. in some form and this should be managed through same group as City Hall and civic auditorium.
Chief Paschke stated that building manager is division commander, not Byron Sieber. He stated that Dale Sebanaler is a supervisor and other maintenance persons work under him. Mr. Sebanaler stated he is responsible for cleaning and maintenance of entire building, purchase supplies, etc. It was noted that the Civic Auditorium Bldg. & Grounds does grass cutting at the police building. Chief Paschke stated that security of the building must be kept extremely high. It was noted that intent is to transfer responsibility to civic auditorium and bldgs. and grounds manager, thus relieving police of non-police functions.

Mr. Geller stated that primary reason to even consider would be to see if savings and efficiency involved without compromising security, and that he would be interested in asking Mr. Owens and Chief Paschke to develop cost benefit transition plan and present to committee at some future date for consideration, seconded by McCabe. Motion carried. (committee only)

11. Matter of cancellation of sidewalk assessment, 1214 S. 12th
Street under CIP policy.
Mr. Schmisek presented request from Carlos I. and Pilar R. Gutierrez, 1214 South 12th Street, that their sidewalk assessment for five-year period be canceled, and that they qualify under income levels established in the CIP policy. Moved by Babinchak and seconded by McCabe that the assessment in the amount of $885.23 be canceled. Motion carried.

12. Matter of funding City's investment in North Dakota Small
Business Investment Company.
Mr. Schmisek reported that letter received from the North
Dakota Small Business Investment Company stated they will be requesting their funds fairly soon, and that City hasn't determined source of those funds, $100,000. Moved by Geller and Babinchak to transfer $100,000 from sales tax to the Growth Fund. Motion carried.

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13. Matter of sale of City property at 40th Ave.S. and S.
Washington Street.
Mr. Schmisek reported that the Red Cross Chapter is still looking at this item and have asked for temporary hold of approx. 30 days pending their further discussion; that they are still interested in that property and are looking at their over-all budget. Held in committee.

14. Matter of surplus property (drafting tables, equipment).
Al Grasser reported this property declared surplus approx. year with price established as $900 per table and $100 per machine, haven't had any takers at those prices and are proposing to reduce offer to sell for $500 per table and $75 per machine. Mr. Swanson advised that if already declared surplus, authorize department to sell at private or public sale. There was some discussion whether to offer for sale or to give to another city department who might be able to use the equipment.

Moved by McCabe and Babinchak to authorize sale of equipment at private or public sale and money be re-allocated to the engineering department. Motion carried. (committee only)

15. Matter of bidding process re. local preference.
Held for 2 weeks.

16. Matter of Handy-Mail processing City mail.
Mr. Schmisek reviewed memo sent to committee outlining costs and savings to the City - cost of approx. $7300 per year for the City to process and meter its own mail (in addition looking to remodeling of mail room), and cost of appox. $1,443.84/year for Handy Mail to process and meter. He reported that Grace Stromli had presented proposal to him, and deserves commendation.

Moved by McCabe and Babinchak that this matter be approved and that the proper City officials be authorized to enter into an agreement with Handy Mail for processing City mail. Motion carried. (committee only)

17. Matter of discussion on budget process for 1996.
Held for 2 weeks.

18. Temporary and overtime statement for December, 1994.
Mr. Schmisek reviewed the statement. Moved by McCabe and Babinchak to receive and file. Motion carried. (comm. only)

19. Request by Bob Hulst for City to donate land for amusement
park.
Bob Hulst, 713 1st Ave.NE, East Grand Forks, stated he is asking for donation of City land to start an amusement park so kids would have place to go and something to do - get kids off Washington Street; that he has 12 rides and will be getting more
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equipment; that he is requesting $25,000 funding through Park Board Ulland fund. He stated he is looking for approx. 3 acres of land. Mr. Schmisek questioned whether City could just donate property and don't know whether they have 3 acres of land, property scattered, lot size parcels; Mr. Swanson stated property would have to be declared surplus and put out for bid. The committee suggested to Mr. Hulst that he review inventory of lots available at city auditor's office, to come back if find something suitable, and then determine City's action. They suggested that he present his request to the Park Board and also to the Fair Board. He stated he had talked with Leker and Mr. Amundson and was told no (couldn't be in parks because he charges, and Fair didn't want competition for annual carnival). The committee referred the matter to the finance office.

20. Appointment to Small Business Investment Council.
Mr. Schmisek reported that they have been requested to appoint a rep. to the Advisory Board for the North Dakota Small Business Investment Company, and Mayor has recommended him for the appointment, would entail 3 or 4 meetings year with report back to council. It was reported that staff for the Jobs Development Authority is going to be either Urban Development and/or city auditor. Mr. Swanson stated that this would be member of Board of Directors of that non-profit corporation. Moved by Geller and McCabe to appoint John Schmisek as City's
representative on the SBIC. Motion carried.

21. Matter of budget amendments.
Mr. Schmisek presented the following budget amendments:
a) $172,205 - payback of 1994 unused health insurance.
b) $13,172 to increase budget for 1994 Health Insurance
payback FICA and Medicare deductions.
c) $97,281 - to carry forward balance of 1994 base retention fund.
d) $334.00 - city attorney's budget - reimbursement for 1994 air fare for NIMLO Conference.
Moved by Geller and McCabe to approve the budget amendments. Motion carried.

22. Meeting time.
Mr. McCabe stated that he has class until 3:25 on Tuesdays and asked if committee could move meeting time back by 10 minutes or so; committee changed meeting time to 3:45 p.m.

23. Matter of motion re. health insurance contribution for part- time employees at January 17, 1995 council meeting.
Mr. Swanson reported that at the last council meeting there was motion dealing with health insurance benefits for part-time employees and after drafted and approved, reads "effective January 17, 1995, the City will no longer contribute 100% of the premium for health care for part-time employees."; the intent was
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that for any employee seeking coverage after January 17, 1995; and suggested that the minutes of this committee reflect that discussion and that the minutes of the council meeting of January 17, 1995 should be amended when those minutes appear on council agenda for approval. Info. only.

Meeting adjourned.

Alice Fontaine
City Clerk

Dated: 2/01/95.