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COMMITTEE OF THE WHOLE - MINUTES - 9/22/2005 COMMITTEE OF THE WHOLE – CITY OF MUSKEGO Approved MINUTES OF MEETING HELD SEPTEMBER 22, 2005 Ald. Melcher chaired the meeting and called it to order at 7:04 PM. Those present recited the Pledge of Allegiance. ROLL CALL Present: Mayor Damaske, Ald. Borgman, Ald. Melcher, Ald. Patterson (arrived at 7:12 PM following the Teen Advisory Board meeting), Ald. Salentine, Ald. Schroeder, Interim Finance Director Mueller, Clerk-Treasurer Moyer, Deputy Clerk Blenski and Jeff Verburgt of the Tess Corners Volunteer Fire Department. Absent: Ald. Buckmaster and Ald. Madden STATEMENT OF PUBLIC NOTICE The Deputy Clerk stated that the meeting was noticed in accordance with the opening meeting law. REVIEW MINUTES OF PREVIOUS MEETING Ald. Salentine moved for approval of the September 15, 2005 minutes. Ald. Borgman seconded. The following corrections were requested: Page 6, “5013C” should be “501 (3)(C)” and Page 7, “Ald. Madden stated what she expected of the city administrator was to look at all the departments and recommend the department is staff to it capacity or not meet with all department heads before making staff recommendations.” Motion to approve the minutes as corrected carried. UNFINISHED BUSINESS 3. Continue Review of 2006 Operating Budget Clerk-Treasurer Janice Moyer appeared before the Committee regarding the Customer Service/Specialty Service Clerk position in her department. The position will become vacant as of November 21 as the employee will be retiring. She is requesting to discuss two of the existing job duties. Ms. Moyer is looking for direction as to whether the Common Council intends to fill the position. The first duty is rescue billing. About 50% of the employee’s workload is related to rescue billing that includes reviewing invoices monthly, preparing annual tax roll statements, processing delinquent invoices for collection, preparing insurance and Medicare/Title 19 claims, and contact with patients, attorneys and insurance companies. Ms. Moyer noted there was a $2,307 decrease to the fund balance of the Rescue Fund for 2004. Ms. Moyer has discussed rescue billing with the City of Brookfield, Village of Elm Grove and City of New Berlin. Those communities do outsource their rescue billing and have been pleased with the service provided. They commented that the expertise needed to do the billing was something they felt uncomfortable providing without having a medical background. The City has been fortunate to have a staff person in this position that has obtained this knowledge over the years. Finding a person with the same knowledge at the current pay grade may be difficult or not realistic. Based on the City’s 2004 collections, the annual cost for a billing service would be $20,000 to $23,000, which is about the same cost the City is incurring annually for staff to do the billing. The other issue is the City Hall Switchboard. Another duty of the employee is to answer the general number for City Hall. There are four incoming lines that ring at the switchboard. At this time, approximately 15% of this Committee of the Whole Page 2 September 22, 2005 position’s time is spent answering the phone. Ms. Moyer is requesting to explore the option of using some type of automated answering system. Ms. Moyer noted several options:  Continue to do rescue billing in-house and switchboard as is and keep the existing position as is, a full-time position.  Outsource the rescue billing and use automated answering for the switchboard. Do not fill the position and add an amount for overtime.  Discontinue in-house or outsourced rescue billing and use automated answering for the switchboard. Do not fill the position and add an amount for overtime. Ms. Moyer is looking for feedback at this point. In addition to the two duties noted, the employee spends about 20% on licenses, 5% on ordering supplies and 10% on miscellaneous duties. Ms. Moyer stated she would review how her department could handle these duties. She is requesting that some of the overtime removed from her budget be put back (approximately $1,000) to provide some flexibility. Ald. Schroeder stated he favors outsourcing the rescue billing. He asked the Clerk- Treasurer what she would do if an automated answering system were not used. Ms. Moyer responded she was looking for direction. She has implemented an answering system in the past and is confident that it can work. It has to be customer friendly. Education is key. Ms. Moyer suggested trying it for a year. Ald. Schroeder suggested keeping the position in the 2006 budget for now. Ald. Patterson questioned the level of knowledge that doing the rescue billing requires. Ms. Moyer stated more knowledge is required than you think. It has changed over time, with the new HIPPA law being one example. Ald. Patterson said he was not concerned with the rescue billing but did have a problem with an automated answering system. People are calling when there is a problem; an automated answering system can add to their frustration. He suggested the possibility of using two part-time people versus one full-time person. Ms. Moyer stated she has thought about that possibility and has discussed with a community that is doing just that. She has been told it works well. Ald. Schroeder suggested that the Clerk-Treasurer research outsourcing the rescue billing and automated phone service. The position will remain in the budget with the Clerk discussing any personnel decisions following her research with the City Administrator. Ald. Melcher stated his opposition to an automated phone system. He believes that personal contact is very important. Ald. Salentine stated she favors outsourcing the rescue billing and would support a “user friendly” automated phone service. Ald. Borgman also agreed with outsourcing the rescue billing and was willing to try an automated phone service. He has not experienced any that are “user friendly.” Ald. Schroeder would like to see information on both issues as stated earlier. Ald. Patterson also supported the outsourcing and reiterated his opposition to the automated answering system. Ald. Melcher stated the first contact someone has with the City should be a human voice. Committee of the Whole Page 3 September 22, 2005 Ald. Melcher was concerned with how the other department staff felt. The Clerk- Treasurer stated she has been communicating with her staff but has told them she is not sure what will happen with the position, as the Council will make the decisions. Ald. Schroeder requested that Ald. Buckmaster and Madden be contacted for their input. He stated the Clerk should move forward if a positive response is received from them. Ms. Mueller requested that Mr. Verburgt be allowed to provide input. Mr. Verburgt stated losing an employee who has been doing this type of work for years would certainly be a detriment. The rescue service is going to be implementing new software to do the rescue reports. The state is requiring that within a year, they be able to electronically upload information. All rescue reports will be done electronically. All of the data will be kept here. A separate module is available for $6,500 that could save time and provide assistance with the billing. Mr. Verburgt acknowledged that the employee does not only spend time working on data retrieval and input. There is a considerable amount of telephone time as well. IS Director Sommers was going to put this module in the 2007 Capital Budget. Ms. Moyer said it was her understanding that the dollar amount was higher. Ald. Patterson suggested the Clerk-Treasurer and employee look at the program. Ms. Moyer pointed out that even if the computer “does it all,” someone still has to have oversight. That is a concern of hers. The billing is not the only part of this. A large part is customer service, which includes listening to people. In addition, only $3,000 is being included for administrative services. The City is losing money by doing the billing in house. Ms. Moyer noted that the City does not have to be involved in the billing at all. Ald. Borgman suggested letting Tess Corners learn the system, outsource the billing for 2006 and look at the software for 2007. Ald. Patterson suggested that perhaps the employee leaving would entertain the idea of working as a contracted service until the issues with the billing are resolved. Ald. Schroeder stated the Clerk has been given direction; no decisions will be made this evening. The Clerk will research the software, outsourcing the rescue billing and the automated phone system. She can discuss staffing with the City Administrator and bring her findings back to the Committee. The Committee took a recess at 8:17 PM. NEW BUSINESS 1. Presentation of 2006 Special Revenue Budget Following a brief recess, the Committee reconvened at 8:27 PM. Interim Finance Director Mueller presented the 2006 Special Revenue Funds. Ms. Mueller stated these funds generate revenue and are tracked and associated to specific expenses. The net fund balance at the end of 2006 is projected to be $5.6 million. The total page reflects a closeout of TIF Districts 2 through 7. Ms. Mueller proceeded to review each of the specific funds: Committee of the Whole Page 4 September 22, 2005 Park Dedication Fund The major revenue source comes from subdivider fees. The 2006 budget reflects a conservative revenue amount assuming a decrease in development. The expenses listed are for various projects to help improve the City’s parks or to acquire additional parkland. Ald. Schroeder noted that one of the financing sources comes from the landfill (10% of the host fees) and perhaps when the contract is renegotiated in the future, that percentage could be decreased and money allocated to other funds, such as storm water. Special Assessment Fund This fund reflects the assessment on the Movie Plex property for grading work handled by the City. There are nine years remaining after 2006. Refuse/Recycling Fund Most of the revenue is generated from fees charged to residents for refuse/recycling services. With the increase in the number of customers, it is projected that the fund will continue to operate with a positive fund balance. The expenses are made up of wages and benefits for leaf collecting and administrative functions and outside service costs. The fund reflects a transfer of $33,000 to the General Fund to assist in covering additional operating expenses. Ms. Mueller recommends that the rate for refuse/recycling service remain the same for 2006. Ald. Schroeder agreed especially since funds are being transferred out. Ms. Mueller noted that the refuse portion used to be in the General Fund. Revolving Loan Fund Ms. Mueller stated this was set up with state funding in the amount of $320,000, which is owed back to the state if the program is closed out. There has been no activity in this fund in over a year. However, a new application was recently approved through an adopted resolution of the Council. The amortization schedule has not been received yet so the fund does not reflect any estimated interest that will be realized. EPI Standing Committee Fund This fund was set up to track revenues and expenses related to monitoring the landfill operations. The City receives $10,000 annually from Onyx under the terms of the contract. The expenditures reflect administrative and committee related expenses. Priority Lakes Fund This fund will close out by the end of 2006 since State funded programs and assistance grants are no longer available. Ms. Mueller noted that the balance of the Conservation Coordinator ‘s wages and benefits has been transferred to the Conservation Fund because this fund could no longer support the percentage (25%) that was allocated to it. Cable Fund The main revenue source is cable franchise fees. The expenses are mostly made up of a percentage of recreational staff wages and benefits to maintain the records and audit costs. Ms. Mueller proposes an increase in the transfer to the General Fund to compensate for the increasing operating costs. This still leaves a fund balance of $71,400. Ald. Patterson expressed concern about the proposed $140,000 transfer to Committee of the Whole Page 5 September 22, 2005 the General Fund. Ald. Schroeder agreed noting he prefers a fund balance of closer to $100,000 (instead of the $71,400). Landfill Fund The main source of funding here is host fees received from the landfill. Projected for 2005 is approximately $1.464 million based on 615,000 tons of waste. This is a conservative estimate as we have already exceeded 515,000 tons of waste through August, which is 73% greater than where we were a year ago. Moving forward, Ms. Mueller will continue to estimate conservatively as there appears to be no real trend looking back over the last five years. She estimates the 2006 host fees to be approximately $1.342 million based on 536,000 tons of disposal. Expenditure amounts have been increased to reflect higher attorney and landfill audit fees. Ms. Mueller reviewed the transfers to other funds. Two of the transfers are driven by contract obligations. Those are Park Dedication and Land Conservation, which equate to 10% of the host fees. The City is still in the process of establishing more reserves for the Well Protection Fund so $29,453 will be transferred into that fund. This transfer will continue to decrease as interest earnings rise. The last two transfers are to fund storm water and capital expenditure projects. Of the $421,675 transferred to storm water, $255,440 is to fund the storm water basin project for the Industrial Park, with the balance of $166,235 to reduce future debt service obligations for past borrowings related to storm water projects. The transfer of $158,174 to the Capital Expenditure Fund is to support the 2006 capital project requests. That leaves the Landfill Fund with a projected $1.7 million fund balance for 2006. Ms. Mueller asked if a transfer should be made to the Compensated Absences Fund. Ald. Schroeder supports that especially since a transfer was not done in 2005. He suggested at least $400,000 to make up for funds that were not transferred in 2005. Ms. Mueller stated that she is comfortable with a transfer of $300,000. Future Parkland Landfill Committee Fund There has been very little activity regarding this fund. It will continue to cover the expenses of the Standing Committee, primarily being those for the consulting engineer. Well Testing Reserve Fund This fund covers the cost for testing private wells once the landfill closes. Ald. Schroeder prefers the 2006 amount transferred from the landfill fund remain at $33,000 (plus interest) as in the past. Land and Open Space Conservation Fund 2005 revenues include the second half of a grant received for the Ewald Engel property. The $338,620 amount includes $137,000 additional grant funding that is being applied for. The wage and benefit expenditures have increased to reflect the Conservation Coordinator’s portion, which is no longer funded by Priority Lakes. The $134,227 transfer in represents the 10% of landfill host fees and the $137,000 transfer to debt service is to fund future principal and interest payments related to the 2003 borrowing for the Ewald Engel acquisition. Ald. Melcher requested additional information on the Trail Fee line item. Committee of the Whole Page 6 September 22, 2005 Storm Water Fund This fund reflects $255,440 in 2006 for the storm water basin project in the Industrial Park. This was designated as priority one during capital project discussions. Ald. Schroeder asked where the funding for the Tess Corners bridge was coming from. Ms. Mueller stated the engineering portion of $50,000 was budgeted for in the Public Works Capital Improvements Program with discussion that it may be moved to 2007. She noted that the fund balance of $252,887 was to fund the future Boxhorn Channel Dredging Project. Rescue Fund This fund recognizes payments for rescue services to the Tess Corners Fire Department. The revenue is based off of billings charged to users for the service. Ms. Mueller noted that she and the Clerk-Treasurer would be doing research regarding the billing for rescue service. Capital Improvement Fund This fund has funded the cost of computer replacements over the last few years. Included in this fund is a 2003 transfer of positive distribution of tax increment. Ms. Muller projects that only half of the budgeted transfer will be needed to fund the General Operating Budget for 2005. That balance could be used in 2006. This fund will also be the holding place for the 2006 distribution of tax increment for future funding. Tax Incremental District Fund Only TID No. 8 and No. 9 are currently active and continue to collect taxes. TID Nos. 2 through 7 will be closing at the end of this year with their remaining fund balance to be distributed to the other governmental entities. The City will receive 20% or less of that distribution. Since the percentage is unknown at this time, no funds were transferred. Ms. Mueller will wait until after the audit. Sewer Utility or RCA Fund This will also close along with the TID funds; 80% of the fund balance will be distributed to the other governmental entities with the remaining 20% distributed to the City. Ms. Mueller has split the distribution by transferring $178,563 for capital improvements and $150,337 to fund the operating budget. Grant Fund This fund will always have a zero balance. In simple terms, the grant funding brought into this fund is also paid out as expenses. Most of the grants are for the Police Department. GIS Fund This fund has been set up in response to the operating budget discussions. It will support future GIS capital project requests. Ms. Mueller will discuss the GIS Planemetric item with the Plan Director. Recreation Ticket Sales Fund This program is operated by the Clerk-Treasurer Department. This fund increases by approximately $2,000 a year with revenues in excess of expenses. Committee of the Whole Page 7 September 22, 2005 Community Development Authority (CDA) Fund This fund continues to be supported by the General Fund. According to the Plan Director, future funding may come from property sales of leasing. At this point, this is still an unknown factor. Approximately 5% of the Plan Director’s and Secretary’s wages and benefits are allocated to this fund. Compensated Absences Reserve Fund The entire funding source comes from landfill transfers and interest earnings. As discussed earlier, an additional $300,000 will be transferred into this fund. Ms. Mueller noted that a levy limit worksheet was received. The levy could be increased as allowed by the state. She noted that was not the intent of the Council. Ms. Mueller noted some changes made to the Operating Budget since the Committee initially reviewed it:  $35,000 from operating to the CDA Special Revenue Fund  Cable is an additional $10,421  Tess Corners is requesting to budget exactly the same as in 2005, which would be a $3,800 increase. Mayor Damaske will review the change to the line items to see what the additional funds would be allocated for. Ald. Schroeder requested a presentation be done by the Muskego Volunteer Fire Co. regarding its operating budget. He does not understand why Muskego’s operating budget is $60,000 to $70,000 higher than Tess Corners’ budget. It might be justified but he would like to see an explanation. Ms. Mueller stated the main difference between the two budgets for the departments is the cost of training. The training processes of the departments were discussed with the suggestion joint training be reviewed as an option. Ald. Patterson would like to see the detail regarding training costs. Ald. Schroeder asked if the City could require a yearly audit for each fire department. The City does not know if all the money budgeted is being spent. Language that would require an audit is currently not in any of the agreements. Ald. Schroeder noted in 2004, Muskego’s budget was $257,400. The department requested a 12% increase for 2005 largely due to a corporate reorganization that was to occur. He does not know if that was ever completed. Muskego did note that the following year (2006), there would be a decrease. Now, the proposed budget for MVFC included another 12% increase which staff brought down to a 5% increase. Ald. Schroeder stated he would not approve anything above the 2005 budgeted amount ($289,000) especially since a decrease was promised. He reiterated the need to see a presentation. It was determined that the next meeting would be used for the fire department presentation and discussion with Engineering/Building Inspection Director McMullen. Ms. Mueller will make the contact. Ald. Schroeder discussed Training and Conferences. He said he does not approve of sending the same employee to a national conference every year. Mayor Damaske said some type of written report should be required. There must be accountability; the Mayor will discuss with the City Administrator. Ald. Melcher did not agree that the same Committee of the Whole Page 8 September 22, 2005 person should not attend an annual national conference. He suggested a ceiling cost. The employee may have to bear some of the cost for further education. ADJOURNMENT Ald. Salentine moved to adjourn at 9:45 PM. Ald. Patterson seconded; motion carried. Respectfully submitted, Jill Blenski, CMC Deputy Clerk