Committee Minutes

MINUTES/FINANCE COMMITTEE
Tuesday, February 10, 1998 - 3:45 p.m.

Members present: Carpenter, Babinchak, Bakken, Hamerlik.

1. Matter of insurance for bought out properties.
Mr. Schmisek reported that committee had received listing of properties purchased that have potential for rehabbing; and ques-tion arose whether to place on State Fire & Tornado Insurance for the properties.

Mrs. Jerath, deputy city auditor, reported she had received listing from Dennis Borowicz, manager of City bought out properties, Urban Development, that she talked to Mr. Carsen, assessor, houses valued at approx. $35-40,000 each, and called insurance company for cost of insurance. She reported the figures given to her were: for $35,000 house, premium $20.20/year, and for $40,000 house, $23.08/ year. She reported that they sent application which will require lot of information (photo, drawing for each structure, construction classification, number of stories, floor area, use, etc.) and based on the average value and premium charges. She reported there are about 101 properties (structural coverage in case of fire, etc.) It was noted that they provide liability coverage under City's current blanket policy. Mrs. Jerath reported that in talking with Dennis, he noted that houses in Phase II worth saving. Mr. Schmisek suggested that they are looking for establishment of policy as there will be more houses (Mr. Borowicz reported approx. 1200 properties purchased but not for rehabbing.)

Moved by Bakken and Babinchak to establish policy that City insure with State Fire Insurance & Tornado Fund houses acquired under the voluntary acquisition program.

Mr. Schmisek reported that when they were saying rehabbable, house sold and moved for rehabbing. Committee questioned funding for insuring houses; Mr. Schmisek reported out of CDBG admin. portion of the budget.

Gene Schneeweis, 1004 University Avenue, asked why is City rehabbing to resell; Committee noted that City not rehabbing, but if property has potential for rehabbing, could be sold for moving and rehabbing. Mr. Schneeweis asked if funding from sale of houses would go back to FEMA. Mr. Swanson reported that some houses pur-chased through CDBG, and those decisions not made. It was also noted that if houses rehabbable could be given to Habitat, etc. and it was noted that decisions not made.

Upon call for the question, the motion carried.

2. Matter of Blue Cross/Blue Shield settlement.
Rick Duquette reported that the Mayor was unable to attend, that Mayor Owens suggested helping defray future health care costs for employees paying portion of premium now and these dollars applied to that.
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Dan Gordon, exec. director Human Resources, reported that if look at those in January who are recipients of health insurance (family or single coverage) talking about 372 people, total cost of slightly over $16,000; if go back to June of 1997 talking about small percentage of difference, that these are full-time classified employees or benefitted part-time people, not much difference in number of people since June, and settlement of $58,000 would cover about 3 1/2 months of increase of family or single coverage.

Committee asked what settlement was for. Mr. Gordon reported that the reason for settlement was when City self-insured, Blue Cross/
Blue Shield discounted hospital for charges and did not discount premium rates (self agencies went together for law suit), and was for around a five-year period (1986 to 1991).

There was some discussion re. current employees that weren't here in 1986 and 1991 and why should they benefit. Mr. Gordon stated that were looking at what happened in May for increase on current employees and this would off-set that payment, would be simpler and hopefully increase some of the issues of this issue.

Hamerlik expressed concern that this should go before Pension & Insurance Committee; that there is meeting on February 17. Jim Schothorst reported that during that period of time he was actively involved in negotiations with the City, for two years was chief negotiator for employees and that they had self-funded insurance program that they kept afloat; had large number of instances that drove deeply into the red and for two of five year period of time entire wage negotiation went into the self-funded insurance fund; that even after going into another plan funding for several years went to insurance fund rather than given to employees because of outstanding claims and until those claim cleared there was a dispersion of money at that point of time. He stated he was not sure what should be done, and thought the matter should go to the Pension and Insurance Committee at their next meeting.

Mr. Gordon stated this is an unexpected gift to employees and to make as fair as possible to every group of employees, that going back to 1986 don't know how will work, that mayor's recommendation clear, and that it's committee decision and not employees. He reported that if there is much argument with it, is to place this pool of money into a fund and use that for potential funds for cost of living increases, is a one-time offer and can be used for other means. He stated this will be as wage study, when get 372 employees in this issue, will not be resolved for year, is simple and is a gift. Mr. Schmisek reported overriding nightmare if have to go back to 1986 or 1991 and determine who was in plan, etc. and simple approach was received now and pick up load for those who picked up increased premium.

Mr. Schothorst stated he has no idea of how money should be
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dispensed but do have Pension and Insurance Committee and should wait one week and to bring to committee for discussion. Hamerlik suggested sending to the Pension Committee as well. Carpenter suggested to send to committee to hear their comments but to bring back to finance at their next meeting, and that finance would act with or without recommendation from Pension Committee.

Moved by Bakken to refer to the Pension and Insurance Committee, and to bring back to the finance committee at next meeting. Motion carried. (committee only)

3. Matter of review of private vehicle reimbursement policy.
Mr. Schmisek reviewed background information on the policy adopted in 1995 for 1996 and reviewed in 1996 for 1997; basically the only things that change annually now is the IRS allowable mileage reimbursement; and that in 1996 asked that this be brought back for committee's review and consideration. He reported they have not heard anything from employee groups who receive this who are looking for any type of adjustment. Mr. Schmisek reported that the IRS rate for 1998 is 32.5 cents/mile and is automatic rate adjustment each January 1. Mel Carsen reported he has not talked with any other department but his department is satisfied with this approach, gives base plus mileage reimbursement, and no complaints from his department since this instituted.

There was some discussion re. rates: flat rate base plus mileage reimbursement for each mile traveled. It was noted that in-state and out of state rates same, and within purchasing guidelines it was requested that people travel together as much as possible. It was also noted that the City follows IRS rates rather than State rates for meals and motels, etc. as well as mileage. The Committee also noted that they have not heard any complaints. Mr. Carsen reported his department has 3 appraisers, deputy and himself who provide vehicles and policy is acceptable to employees, their department averages about $100/mo or less per employee vehicle; that City couldn't provide vehicle for that rate.

Moved by Bakken and Babinchak for continuance of the policy for 1998. Motion carried.

4. Consideration of bids:
a) mailing machine
Held for 2 weeks.

b) safes for water utility and MIS
Mrs. Jerath reported one bid received from Gaffaney's in the amount of $1,435 each and meets specifications. It was noted that they sent out 3 or 4 bids plus advertised in the newspaper (price comparable with catalogs). Moved by Bakken and Babinchak to accept the bid of Gaffaney's in the amount of $1,435.00 each. Motion carried. (committee only)
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c) mailing service for utility billing
Mrs. Jerath reported they received one bid, Fine Print of Grand Forks, Inc. at cost of $360/mo (that they bid $30/per 1,000 and City has about 1200 accounts), existing service by Nodak and are paying about $438/mo plus MIS employee spends approx. two days each month doing the work, they did not submit bid. It was noted that there is a discount rate of 10% per day if mailed after City's deadline. It was noted this will be an annual contract and renew-able. Moved by Bakken and Hamerlik to accept bid of Fine Print of Grand Forks, Inc. Motion carried. (committee only)

5. Matter of security locks for City Hall.
Mr. Schmisek reported that due to flood and some of the damage that occurred to some doors and locks were in a position that need to change some of those out and re-key, and in visiting with cus-todial staff it has become chore in keeping track of keys and is also very expensive with key system to get the plates and key prints that have to have so asked for a bid on a card system that can use our computers to update or cancel people out, plus can designate various doors that someone can get them into, etc. He reported they received bid from Keith's Lock & Key for $22,148.20 and other bid from Best Lock Company for $26,911.23. Bob Owens is recommending Keith's Lock & Key, that they went through systems with the two companies. Carpenter reported that First National has other system (not card system) asked whether that system had been checked, staff will check that system prior to the council meeting and if comes in within certain window bring back to committee. Moved by Hamerlik and Babinchak to award bid for card system to Keith's Lock and Key in the amount of $22,148.20. Motion carried.

6. Budget amendment.
Mr. Schmisek presented request for budget amendment for Youth Commission to reflect grant money in the amount of $17,000. He reported that Youth Committee is out of the City's main budget but were told to go ahead and seek grant fund, presently weaning off City's system and onto their own accounting system. Moved by Babinchak and Bakken to approve the budget amendment. Motion carried.

7. Matter of RFP identifying consultants to Assist in the design and installation of a Wide Area Network to connect several City
office buildings.
Mr. Schmisek reported this is request to consider proposals and introduced Mary Mitchell, new MIS office manager. He reported that they found very quickly during the flood that our communication among ourselves through computer network and data base centralized system was somewhat lacking and are pursing this for consultant to go ahead and get background to see what cost us to proceed.

Mrs. Mitchell reviewed RFP along with listing of companies they
will send RFP to in addition to advertising channels, want to make
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sure send to networks that handle full project (used companies in yellow pages under computer programming, and may put out on inter-net). She reported that the project will be a rather large pro-ject, hoping to get one company that can do project management and all phases of it. She reported they are asking for network archi-tecture and design and costs for the installation, a Novell to Windows NT Platform and Lotus Notes installation that will support our E-mail capabilities; it's an open architecture system we can do a lot of programming to track requests and can be used a number of different ways, and lastly internet consulting. She reported that timeline is with bids due on March 10, two weeks to review bids, select top three and bring back to finance for consideration, and if pursue, to council on April 6. She reported that she has asked in the proposal that they can do phasing of the project, as many different locations, and asked to prepare in a way by phase.

There was some discussion re. anticipated cost, staff say "shooting in the dark" and that's why proposal being phased. Mrs. Mitchell reported that the hourly rate for network consulting is $125/hr. but has talked to one of the companies sending proposals to get idea of cost and number of hours and depending on how do it, could run $50,000 to $250,000 to do networking and they seem to be able to have these numbers readily available without a large amount of pre-work, and would be surprised if consulting work over 40 hours to do whole thing. Mr. Schmisek reported that there are some funds in the Computer Replacement Fund to allow to get a start on this and some funding in MIS administrative budget under CDBG, part of this is flood-related, to try to centralize data and GIS mapping that has t do with flood and have checked that and is valid use of funding.

Moved by Hamerlik and Babinchak that we authorize request for pro-posals. Motion carried. (committee only)

Moved by Hamerlik and Babinchak to adjourn; meeting adjourned at 4:40 p.m.

Alice Fontaine
City Clerk

Dated: 2/10/98.