DRAFT

CITY OF ROCKY RIVER

FEBRUARY 3, 2005

Finance Committee

The meeting of the Finance Committee was called to order by the Chairman, Mr. Hurtuk, at 2:04 p.m. in the David J. Cook Council Chambers.

Finance Committee Members Present: Mr. Hurtuk, Mrs. Bobst, Mr. Frost, Mr. Gollinger

Council members present: Mr. Potterfield, Mrs. Bartolozzi, Mr. Hagan

Administration: Mayor Knoble, Mr. Thomas, Mr. Linden, Lt. Hudec, Chief Flynn,

Mr. Patterson, Mrs. Calladine, Mr. Winterich, Mr. Reyes, Mr. Koran,

Mr. Beirne

Also present: Judge Fitzsimmons, Magistrate Valponi, Magistrate Serrat, Clerk of Court Gareau

Law Director: Not required or requested

Mr. Hurtuk opened the meeting with thanks to Council members and to Mr. Thomas for his timely report. He commented that his goal is to continue open dialogue with the Administration on appropriations. Council will not try to set policy and if discussions stray from the topic of appropriations provided for in the budget, Mr. Hurtuk will interrupt and refocus the discussion.

He asked the Mayor to comment on the budget and review some key points.

Mayor Knoble thanked Finance Director Thomas for his late night and weekend efforts. He indicated that the process of formulating the budget began with meetings with each individual department head to determine needs. His charge to each was to request only what was positively needed.

Since wages are determined by levels set by union agreements and necessary staffing, two large flexible areas are Capital Expenditures and Equipment. As always, the Mayor reiterated that the budget is a "work in progress". As an example, he mentioned that last Friday, Emil Rosol was involved in an accident in which the City Hall boiler blew up. Mr. Rosol was not seriously injured, but the boiler may require $14,000 in repairs to meet current boiler codes. The Mayor said that he realized that these things happen and the budget needs to be reviewed periodically during the year.

The Mayor noted that last year, all projects were not done, and all equipment budgeted was not purchased, and he does not expect to complete both lists this year. Items were included to compile a needed wish list. He has notified the three members of the Engineering Department who will be terminated at the end of March. He also met with union representatives to give the required six-month notice that pavement striping will be outsourced.

In revenue matters, state funding cuts could be between 10% and 20%, or over $80,000 to $160,000 per year. Since any cuts would go into effect with the fiscal budget in July, only about half that amount would apply for this year. Estate tax receipts last year were double the budgeted amount, or $3.3 million. This was very helpful to the City in meeting its obligations. Its future, however, is uncertain, as there is a move by State Representative Sally Conway Kilbane in the house to abolish the estate tax. This would negatively impact many cities, and they are organizing to protest. Westgate should not affect the City's budget this year, as the City is currently not receiving income tax from the vacant buildings that are in Rocky River.

• •Mr. Hurtuk confirmed that the City is currently in the third year of a three-year contract with union employees and asked the Mayor when he expects negotiations to begin. The Mayor said that realistically, not until October.
• •Mr. Hurtuk asked if the process will again be done in-house, and the Mayor said that he felt they would.
• •Finally, Mr. Hurtuk asked about the raises given to City Hall employees. The Mayor indicated that it was 3%, and the Court employees also received 3%.
• •Mrs. Bobst asked about notification of estate taxes. Mr. Thomas explained that when notified, the City can request an advance of 75%, which he did in December. He can call the County to monitor future filings.
  
  

Mr. Thomas opened discussion of his budget materials by referencing Tab 3, fund descriptions, and Tab 4, Estimated Fund Balances. He noted that the balances are unencumbered; that the General Fund has increased; that many funds have good balances, so that he does not expect to transfer funds until the amounts are depleted. He expects some savings because of the outsourcing of engineering and paint striping. Mrs. Bobst asked if fund balances for the last 5 years are available. Mr. Thomas said that they were.

• •Mr. Hurtuk confirmed that estate taxes are in the Permanent Improvement Fund.
• •Mrs. Bobst asked if Mr. Thomas is concerned about any of the ending balances or any of the funds. Mr. Thomas responded that he is comfortable with the projections and the ending balances.
  
  

Police Department appropriations were addressed by Safety-Service Director Linden and Lt. Terry Hudec. Mr. Linden explained that needs were reviewed at a meeting with the Mayor and the Finance Director. He feels that the result is a reasonable budget for this year.

• •Mr. Hurtuk asked about the work force. Lt. Hudec indicated that one new employee has been added, a Community Service Officer who will be a non-sworn, unarmed officer, in uniform, who will perform non-police functions such as releasing cars from the impound lot, unlocking cars and jail duty, to free sworn officers for police duties. This will be a part-time position at an hourly rate. In response to a question from Mr. Frost, the Mayor noted that this officer will not take over park duties such as unlocking gates, but will do more jail duty, since the jail frequently has 5 inmates, which creates a great deal of work.
• •Mr. Frost asked about the significant increase in the longevity appropriation. The Mayor indicated that the increase was due to the fact that many employees are now in their sixth year and qualify. The Youth Services Coordinator has also finished a two-year probation and will receive a salary increase. Mr. Frost also asked if park guards will be continued. The Mayor responded that all three would.
• •Mr. Gollinger asked about the impact of the officer on leave from the department. The Mayor noted that staffing had not been increased. The officer is currently on sick leave and when his position is finalized, a decision will be made.
• •Mr. Frost asked about the pension allocation for which the actual expenditure was much higher. The Mayor acknowledged that the budgeted amount was incorrectly calculated and a supplemental appropriation was made during the year. He pointed out that a correct calculation would be 19.5% of the wage amount.
• •Mr. Frost then raised the question of vehicle maintenance. Mr. Linden mentioned that there had been few accidents this year, and the Mayor added that light bars had been installed on new police cars.
• •Mr. Hurtuk confirmed that the Police Department has 32 officers, and Lt. Hudec did not foresee retirements.
• •Mrs. Bobst pointed out that in Tab 7, Equipment Purchases, there was no subtotal for Police, and that the subtotal shown combined Police and Recreation.
  
  

Chief Flynn rose to speak for the Fire Department. He commented that the department had had a good year with successful grant writing.

• •Mr. Frost asked about the exhaust system recently installed. The Chief said that it works extremely well and has reduced exhaust both in the Fire Station and in City Hall.
• •Mr. Frost then noted that overtime has been increased less than 1% for this year. The Chief explained that he is cautiously optimistic; last year a lieutenant was on sick leave for six months and that required a great deal of overtime.
• •Mr. Frost then asked about education. Chief Flynn explained that the first figure is a benefit received by qualified firefighters who had reached certain levels of education, e.g. paramed, EMT. The second figure is for outside instructors from the Ohio Academy for in-service education.
• •In equipment purchases, Mr. Frost asked if the Chief foresees any purchases not yet allocated. Chief Flynn noted that some upgrades of defibrillators may be required as well as gradual replacement of airpacks which are taken into fires to allow firefighters to breathe.
• •On p. 25, Mr. Frost noted that the first payment toward central fire dispatch has been appropriated. The Mayor commented that more information should be available after the Mayors' meeting on February 8.
• •Mr. Hurtuk confirmed that the work force is 29, with no retirements foreseen, and one firefighter on probation.
• •Mayor Knoble observed that the Administration continues to struggle with the issue of level of training v. community needs. Beyond the EMT training and basic pistol training which all agree are necessary, other services may not be as regularly used and the question is whether the use justifies the time and expense necessary for training. An example is the dive team; training on overtime is very expensive. Is this a service that our community needs? The same is true of equipment where advances come quickly and constant upgrading is possible.
  
  

The next department, Courts, was represented by Judge Fitzsimmons, Magistrates Valponi and Serrat, and Clerk of Courts Gareau. Mr. Gareau noted that, as to revenues, it had been a good year for the Courts. Mr. Hurtuk thanked the judge, magistrates and the clerk for coming to keep lines of dialogue open between Council and the Courts.

In the Clerk's budget, Mr. Gareau noted that wages rose by 3%. The Computer Tech funds have good balances. New computers were purchased last year. This year main server and firewall server will be replaced at a cost of approximately $54,000. He noted that even with a reduction in cases this year, revenues have not fallen, and a collections program begun last year is going very well. A proposal under consideration now by the judges would include those who have never appear in court as ordered. E-payments also have helped.

Judge Fitzsimmons noted some early concern because 4900 fewer cases were heard this year. However, she noted an increase in civil filings which offset revenue losses. In cases where people have failed to appear, there are probably minor traffic infractions, and persons too busy to come. If notified of collections, however, they will forward fines.

• •Mrs. Bobst asked where case reduction has occurred. Judge Fitzsimmons responded that, most noticeably, in North Olmsted which has decreased its STOP program (similar to POPAS). Westlake and Fairview Park are also showing decreases. Rocky River has had more building cases.
• •Mayor Knoble indicated that on monthly statements, the City will show costs for custodial help, full and part-time, for the Courts, utilities and supplies. That cost is roughly $150-$175,000 annually. If the Courts have no overage, or not enough to meet these costs, the City will lose. Overages do not begin until these costs have been met. The Attorney General has ruled that the City has nothing to do with the Court. Even though Court employees are City employees, the Court is independent, with its own rules, even its own employee manual. The Mayor complimented them on a job well done.
• •Mr. Hurtuk asked what technical equipment purchases are foreseen. Mr. Gareau explained that Mike Bracken, their computer consultant, has been attempting to keep equipment rotated so that it will always be functional. His aim is for a complete overhaul every 3-5 years. The funds are available from their Computer Tech Funds. Judge Fitz-simmons commented that Mr. Bracken had recently presented a three-year plan which keeps equipment in top condition. The Courts and judges have cooperated in this endeavor.
• •Mr. Hagan asked about the probation program. Judge Fitzsimmons indicated that it is continuing to expand. It pays for itself, and has financed a part-time employee to help each judge. Because those on probation pay fees to fund the program, it has been self-sustaining, and has had a surplus to help pay for other aspects of the program.

Again, Mr. Hurtuk thanked those attending for keeping Council apprised of Court developments.

Director Patterson then came forward to discuss recreation. He noted that this past year had seen installation of artificial turf at the high school; construction begun at the Family Aquatic Center; the first full year for Elmwood Cabin and new playground equipment at Linden Park. He noted that Recreation programs are up 10%, with increased participation and additional programming. Elmwood Cabin was rented almost 200 days last year, and appears to be increasing for this year with virtually all weekends already reserved.

• •Mrs. Bobst noted that revenue figures are conservative, e.g. pool 2004 revenue was $133,000 and estimated 2005 is $210,000, even with the pool renovation which allows additional programming. The number of employees has remained stable with part-time lifeguards and park employees.
• •Equipment purchases are replacement items such as skates and some new equipment, as well as a part of the new server shared with the Senior Center.
• •Mrs. Bobst asked how the Cox Cable Fund, designated for Recreation, will be spent. Mr. Patterson responded that the matter had been discussed at the budget meeting and that $15,000 will be used to resurface the tennis courts at Linden Park, last done in 1988 and showing wear. Further, a deck will be added to the back of Elmwood Cabin. Mr. Patterson noted that the Jr. Women's Club has expressed interest in participating in this project, which will cost $12,000 to $17,000, according to three proposals received. In addition, $25,000 may be spent on a potential skate park and $10,000 as part of the City's share of improvements to Rocky River Park. $20,000 will go to improve the Bates Road Tot Lot, and improvements to the rink lobby and restrooms will cost $150,000.
• •Mr. Hurtuk asked about the pool construction. Mr. Patterson noted that the company was five weeks ahead of schedule when the cold hit, with the floor already poured. Work is progressing well, although weather always remains a factor. Mr. Patterson commented that a contest will be held to name the facility. He noted that in Bay Village, attendance figures held up well for the second year of the facility despite unfavorable weather.
• •Mr. Frost asked about needs for the Zamboni machine which has had recent problems. Mr. Patterson observed that after an initial problem period of 2-3 weeks, it has been working very well. The same situation occurred last year.
  
  

Next on the agenda was Director Calladine of Senior Services. She stated that, in expenditures, their largest item is transportation, and the largest events are the Volunteer Luncheon and the 90+ Birthday Celebration. Fortunately, both events are financed by the Cleveland Pops Concert and the Craft Show which provide sufficient revenue to cover both.

• •Mr. Hurtuk asked about the cost of the Volunteer Luncheon. Mrs. Calladine responded that is was about $2000. This year it will also be open to others from the community because she feels more should know about the work of the volunteers, and also she would like to attract more volunteers.
• •Mrs. Bobst asked if revenues and expenses of the luncheon or the craft show are reflected in the budget. It was determined that the events are not separately listed, but are combined in revenue and expenditure figures. Mrs. Calladine also noted that the department operated at a surplus of $2919.17
• •It was pointed out that in salaries, last year's figures were higher because Director Umerley was included for part of the year.
• •When asked about social services, a non-budgeted item last year, Mrs. Calladine explained that in past years, this was included under different line items. It is required for seniors who do not have family close by, for example, and require a nurse's assessment or emergency nursing care. She also mentioned that the caregivers' program was off to an excellent start.
• •Land Improvement will be spent for a walkway all around the building which now has only

2 ½ sides of safe walkways. This is necessary because with an evacuation plan in place,

safe footing for the seniors leaving the building in an emergency is necessary.

• •In equipment, six new computers are needed for office personnel. Currently, their computers do not have Word and are not compatible with other City Hall computers.
• •Finally, the budgeted van is the one currently in the process of being purchased. It was also noted that the former police car being used for transportation for mobile seniors is of great help, freeing the van for other uses.
  
  

Mayor Knoble reiterated the challenge faced by Senior Services in helping keep active seniors busy and interested and helping people who really need help from a psychological and physical standpoint.

An extremely busy department, Service, was represented by Commissioner Winterich, who noted that his department is working hard at snow removal and coping with repairs necessary to the equipment.

• •Mr. Gollinger mentioned the Bombadier which has been used to clear sidewalks. Mr. Winterich indicated that driveway aprons and sidewalks are not addressed until main and secondary streets are clear, currently about 8 hours. Mayor Knoble indicated that the cost of an additional machine is about $45,000, and additional staff would be required. Mr. Linden recalled that in 1966 the City had two and were cleaning all sidewalks in the City. That was changed by Mayor Martin and now sidewalks around City property and schools are cleared.
• •Both Council and the Administration feel that Service matters are being well-handled, and have no real concerns.
• •Mr. Gollinger asked about yard waste, noting that trucks used to bring a chipper and shred yard waste in the streets. Mr. Winterich explained that it was felt that this was too noisy and left too much debris on the street, so now materials are collected and brought to a central location and chipped. Mr. Gollinger suggested that a future newsletter article can make their job easier by counseling residents to cut and bundle yard waste.
• •The Mayor reported that it is not the Administration's intent to operate the bait shop at the pier. This will free another man for use on a road crew. He plans to pave some streets and continue the sidewalk program. Communication with unions on a regular basis has led to less conflict and faster resolution of problems.
• •Mrs. Bobst asked about a salt storage building and recalled that the Administration was studying the possibility of sharing the expense of such a building with another suburb. Mr. Winterich expressed possessive feelings about the City's supply of salt, and the opinion that sharing such a structure would not be practical.
• •Mrs. Bobst also mentioned resident requests for commingled paper recycling at curbside. Mr. Winterich reported that the cardboard bin at the Service Department is always busy and residents make an effort to recycle their paper. Mr. Winterich was open, however, to the suggestion of curbside pickup if Council wished to pursue the idea. Mr. Potterfield asked if the situation has changed since the time when only metal recycling is fiscally feasible. Mr. Winterich said that currently, cardboard materials bring $30/ton. Mr. Linden added that, even after trucking, a net profit of $3.63/ton is realized in addition to savings of materials not added to the landfill. Under these circumstances, a once-a-month pickup could probably be justified.
  
  

Mr. Reyes, Assistant Service Commissioner and Forester, next came forward to discuss the Mayor's proposal to extend a tree planting program patterned after that in Bay Village. Under this program, every year a street will be chosen to have trees planted on tree lawns. Last summer, the City commissioned a tree survey with a computer list of every tree on public property and proposals for each street. It is the Administration's intent to begin this year with $25,000 in the budget to plant at least one street in each ward. Residents may decline a tree if they so desire or they may opt to contribute for their tree, but if not, the trees will be planted at City expense. Contributions will mean that more trees can be planted.

• •Mrs. Bobst noted that Tab 6, p. 18 shows the elimination of an employee who will be absorbed in other jobs. She asked about gas and electricity and their costs. The Mayor said that some departments can be included with NOPEC, but the problem now is that there are no sellers.
• •Under equipment, Mrs. Bobst asked about the Rockhound. Mr. Reyes explained that this is a machine used by landscapers to remove small rocks and stones from dirt. He plans to use this machine to help clean the beaches of debris and mussel shells. It will take fewer workers and do a better job. The beaches are typically cleaned once when plantings are complete in April, once in May, and then as dictated by nature.
• •As to other equipment, Mr. Reyes noted that lawn mowers and weedeaters are replaced every two years. What is not covered by the state is done by the City along with 38 cul-de-sacs. The water equipment will be used to water plantings in areas where residents are not available to help out, such as the downtown area. The old equipment holds 300 and 500 gallons, while this holds three times as much for less refilling and more efficiency.
  
  

The Economic Development/Building departments were represented by Director Koran and Commissioner Beirne. Mayor Knoble explained that currently, the Building Department reports to the Engineer. With the dissolution of the Engineering Department, the Building Commissioner will be responsible for new construction, including renovations, supervising Mr. Nugent and the Building Department staff, and property maintenance with Mr. Zell, Mr. Minko and a third inspector, will be under the direction of Mr. Koran.

Of note in the Economic Development budget is the first lease payment for the Beachcliff Market Square garage. Although the garage is not projected to be finished in 2005, it is included in the budget in response to a promise to the developers in case the project is completed ahead of schedule. In streetscaping, funds are waiting for the project to move forward and will be combined with the $300,000 grant received last year to provide beautification of the downtown area. If no extensions are granted, the project must be completed by the end of October.

• •Mr. Hurtuk asked Mr. Koran how, in his experience in Euclid, building owners can be encouraged to refurbish office buildings. Mr. Hurtuk feels there are some buildings on Center Ridge Road in need of remodeling to remain viable. Mr. Koran commented that he shares Mr. Hurtuk's concern and has been working on updating his inventory of available office space. He would like to see remodeling like that of First Federal when it took over the BankOne space. He was surprised to see that the vacancy rate was only 6% to 17%, even in the oldest buildings on Center Ridge. His information came from owners/brokers. The City has historically never granted tax abatement; it is not a City policy. The Master Plan focuses on redevelopment, and Center Ridge is one of the focus areas. Tax abatement in limited places may be the only incentive available to the City. He also suggested that many people who rent on Center Ridge would like to own their property, and when property is newly acquired, renovations are common.
  
  
• •Mrs. Bobst asked about the Exterior Maintenance Program which is doing well. The $20,000 grant received from the County is providing help to some residents. However, Mr. Koran commented that some residents are hesitant to reveal income or other information necessary to apply for the grants. Therefore, it has been decided that the grant application will be made every other year, based upon need. Unmet needs may not be as great as originally thought, and there has been some difficulty in finding viable applicants.
  
  
• •Mr. Gollinger asked about the possibility of reapplying for a County grant for the Rockland/Shoreland area. Mr. Koran said that, unfortunately, the County's ITA area has changed and only Allen Ct. still qualifies and the remainder of the area no longer qualifies.
  
  

Mr. Beirne explained that among Building expenditures is a new program called City View. This software will enable City computers to incorporate pictures of every home (taken over a period of years), along with all information about the property including lot size, aerial views, sewer connections, violations, permits, etc., all on one file. Another digital camera will be necessary. The system will even show cleanouts and sewer information.

The final topic was capital improvements.

• •Mayor Knoble indicated that the Lake Road project will be delayed until ODOT's 2007 fiscal year which begins July, 2006.
• •The Bates Road project is additional work not covered by the contract.
• •The Yacht Club/Riverdale project has changed dramatically, and it is now feasible to complete it without the acquisition of property. This $25,000 will pay for the engineering.
• •The Mayor has met with Fairview Park and he believes there are funds from the Wooster project to cover sewers on Carolyn.
• •Center Ridge paving will need the $41,000 as the City's share of the ODOT program.
• •Curbs and basins are not included in the ODOT program and will require the $100,000 allocated in the budget.
• •Property acquisition at Shoreland and Wooster for a park and parking.
• •The I-90 sound barriers and landscaping on Hilliard following paving should be about $100,000 on a one-time basis.
• •Finally, the Detroit/Spencer culvert is being budgeted at $150,000, based on past experience.

Mr. Potterfield stated that he was under the impression that everything was included in the Orchard Park/Bates project. The Mayor agreed, but is now told by Mr. Lesiecki and Mr. Jurs that necessary work was not covered under the original contract or supplementals. Mayor Knoble acknowledged that in the event of a lawsuit with DiGioia, expert review may be necessary.

Mrs. Bobst asked if the Civic Center generator would be included under the expansion plan. The Mayor responded that it will be included in the specifications, as an alternate bid.

• •Mr. Frost asked if funds might be available from Homeland Security. The Mayor said that is being explored, but no conclusions have been reached.

Mrs. Bobst asked about the traffic signal at $100,000 for Elmwood and Lake. The Mayor said that should cover the entire cost.

Mr. Hurtuk thanked Council members and all participants in the process. He added that a draft of a financial summary should be available by Monday. This will provide a big picture.

He added that no Finance Committee meeting will be held Monday evening and further discussions will be held at the Committee-of-the-Whole.

There was no further discussion from Council, and the meeting was adjourned at 4:58 p.m.

_______________________________ _______________________________

Brian A. Hurtuk, Chairman Misao Kurokawa

Finance Committee Clerk of Council

Please note: This is a draft copy of the minutes of the Rocky River City Council Finance Committee of February 3, 2005. These minutes may be amended or revised at the next Legislative Meeting.