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FM20050125 FINANCE COMMITTEE - CITY OF MUSKEGO Approved MINUTES OF MEETING HELD TUESDAY, JANUARY 25, 2005 The meeting was called to order at 6:44 PM by Mayor Slocomb with Committee Members Salentine, Madden and Schroeder present along with Ald. Borgman, Buckmaster, Melcher and Patterson. Also present were Deputy Clerk Blenski and Phil Cosson of Ehlers & Associates, Inc. Those present recited the Pledge of Allegiance. Mayor Slocomb stated the meeting was noticed in accordance with the open meeting law. APPROVAL OF MINUTES Ald. Salentine moved for approval of the minutes of the meeting held January 19, 2005. Ald. Madden seconded; motion carried. LICENSE APPROVALS Ald. Salentine moved to recommend approval of an Operator’s License for Alissa Beyer. The applicant was interviewed by Mayor Slocomb. Ald. Madden seconded; motion carried. UNFINISHED BUSINESS Continue Discussion of the Review and Possible Amendment to Business Credit Card Policy Including Compliance Policy (Deferred 1/19/2005) It was noted that a document entitled Standards of Conduct and Discipline was provided to the Committee for review. This currently is not a City of Muskego policy. Regarding the credit card limits for department heads, and potentially staff members, if approved, the Mayor requested that the limit be the same - $3,000. Purchases are made for equipment and supplies that warrant that amount. Ald. Schroeder asked where the Standards of Conduct and Discipline came from. Mayor Slocomb stated the detail came from policies of other communities and then tweaked by staff to fit the City of Muskego. He further stated this is what the City has been doing; it just has not been documented in this detail. Ald. Patterson questioned the need for nondepartment head employees to be issued credit cards with a $3,000 limit. The Mayor stated the issuance would be by specific request and approved by the Mayor. Ald. Patterson supports the original proposal: $3,000 for department heads and $1,000 for staff. Ald. Schroeder asked if the Standards of Conduct and Discipline would be adopted as a separate policy. The Mayor said it could be adopted as a separate policy. Ald. Buckmaster noted that he is still not in favor of the card being used for lodging or meals. He agrees that there should be one established limit; the $3,000 seems excessive. However, if there is confirmation to support that amount, he is fine with it. Ald. Buckmaster stated the less cards the better. There will be fewer problems. Ald. Buckmaster asked what the auditing policy was. Mayor Slocomb stated the statements are reviewed by the Accounts Payable employee, and then forwarded to the Finance Committee Minutes Page 2 January 25, 2005 Accountant for compliance with City policies. Any inconsistencies then go to the Finance Director who contacts the appropriate department head. If the issue could not be resolved at that level, it would go to the Mayor. The Mayor would make a final decision regarding the use in question. If the employee did not agree with the decision, the matter could be reviewed by the Finance Committee. He noted that no credit card issues have been presented to him since he has been here. Ald. Schroeder requested that the Standards of Conduct and Discipline be adopted as a policy of the City. Ald. Schroeder moved to amend the last paragraph of the Business Credit Card policy to read, “Noncompliance to any of the above or misuse of the authorized credit card in anyway, may result in a department or employee losing privileges of their card. Noncompliance may also include discipline in accordance with the City of Muskego’s Standards of Conduct and Discipline, possibly up to and including dismissal.” Ald. Salentine seconded. Ald. Buckmaster asked if compliance would be cited in the Standards of Conduct policy or separately on the credit card policy. Ald. Schroeder stated noncompliance to the credit card policy would be dictated by the Standards of Conduct and Discipline. It is also addressed in the last paragraph of the credit card policy. Ald. Buckmaster asked what determines misuse. Ald. Schroeder stated the past Finance Director explained the compliance procedure that is currently in place. It appears to be very complete. He is hopeful it will remain in place with the hiring of her replacement. Ald. Buckmaster requested if it is something that is routinely done, he would like it to be a written policy. Ald. Salentine agreed stating that the Standards of Conduct policy did really address credit card use except for one example. Ald. Buckmaster stated employees need to be held accountable. They need to be put on notice if noncompliance occurs. Ald. Schroeder stated additional work needs to be done on compliance issues. Motion to amend carried. Ald. Patterson asked if there was a history to support the $3,000 limit. Mayor Slocomb stated the limit is needed for items such as equipment, supplies, and software purchases. The internet is commonly used for purchases. Ald. Schroeder moved to defer. Ald. Salentine seconded; motion carried. Review and Approve Clothing Reimbursement-Maintenance/Parks Personnel (Deferred 1/19/2005) Mayor Slocomb stated the detail requested has been provided. Ald. Salentine questioned if the Parks employees would have to purchase similar clothing because now they have uniforms. She believes they should wear clothing that identifies them as Park employees. The Mayor stated not all of the employees are wearing uniforms; it is not required. Ald. Buckmaster stated they should have to wear something that identifies them as Park employees. If not a shirt, perhaps a hat. Ald. Schroeder said the detail is still not clear as to how many employees are being provided uniforms and the total cost per employee. He agrees that the employees should be required to purchase similar clothing for identification purposes. He will not approve reimbursement for clothing that they may or may not wear for work. Ald. Patterson suggested the clothing be purchased from a specific catalog or vendor. Ald. Schroeder agreed and said the department head can make that decision with assistance from the employees. Ald. Schroeder moved to defer to allow the Mayor and Finance Committee Minutes Page 3 January 25, 2005 the Parks and Recreation Director time to discuss the issue with the employees pursuant to the Committee’s comments. He also requested a breakdown of the annual uniform rental cost per employee. Ald. Madden seconded; motion carried. NEW BUSINESS Recommend Approval of Quietwood East II Subdivider’s Agreements and Letter of Credit Ald. Schroeder moved to recommend approval. Ald. Salentine seconded; motion carried. Recommend Approval of Kenwood Place Subdivider’s Agreements, Model Home Agreement and Letter of Credit Ald. Schroeder moved to recommend approval. Ald. Madden seconded; motion carried. Recommend Approval of Lindale Villas Subdivider’s Agreements, Model Home Agreement and Letter of Credit Ald. Schroeder moved to recommend approval. Ald. Salentine seconded; motion carried. Recommend Approval of the Sale of $1,585,000 General Obligation Promissory Notes Mr. Phil Cosson of Ehlers & Associates, Inc. presented the 2005 Financing Plan (General Fund, Water Utility and Sewer Utility). He said the plan outlines financing the 2005 budgeted capital items. Mr. Cosson stated the 2005 capital items total $1,526,000. The breakdown of that is as follows: Water Utility Projects $ 600,000 Phone System 60,000 Public Safety Equipment 408,000 Transportation Equipment and Street Lighting 458,000 The water utility projects were added to the borrowing at this time because the size does not lend itself to doing a separate issue. The City will save the expenses that would be incurred if done separately. The amount will cover the 2005 and 2006 projects. The total amount of the borrowing is $1,585,000. Ald. Schroeder moved to recommend approval. Ald. Salentine seconded; motion carried. Mr. Cosson reviewed the Water Utility Analysis and noted that the utility is healthy. There should be no problem maintaining the A3 rating. The utility should be able to absorb future capital projects without any major rate adjustments. Recommend Approval of the Sale of $4,315,000 Sewer System Revenue Refunding Bonds Mr. Cosson then reviewed the Sewer Utility Refunding. The MMSD capital charges have more than doubled, which will take effect in 2005. That has created a cash flow issue for the sewer utility. A 33% rate increase went into effect in 2005 to help absorb the additional costs. In addition, refinancing and restructuring the debt was reviewed. The proposed revenue bond issue will reduce the utility’s debt from a little over $9 million to a little over $4 million over a 15-year period. The goal of the restructuring was to maintain a coverage ratio that was at least 2.25 or better. The concern is that Finance Committee Minutes Page 4 January 25, 2005 the utility maintain its A1 rating. Ald. Schroeder moved to recommend approval. Ald. Madden seconded; motion carried. VOUCHER APPROVAL Ald. Salentine moved for approval of payment of General Vouchers in the amount of $539,367.61, Tax Checks in the amount of $15,539.19 and Utility Vouchers in the amount of $334,763.20. Ald. Madden seconded; motion carried. ADJOURNMENT Ald. Salentine moved to adjourn at 8:03 p.m. Ald. Madden seconded; motion carried. Respectfully submitted, Jill Blenski, CMC Deputy Clerk