SUMMARY MINUTES OF A WORK SESSION
OF THE CHAPEL HILL TOWN COUNCIL
WEDNESDAY, APRIL 24, 2002, AT 4:00 P.M.
Mayor Kevin Foy called the meeting to order at 4:00 p.m.
Council members present were Flicka Bateman, Pat Evans, Ed Harrison, Bill Strom, Jim Ward, and Edith Wiggins. Council Members absent, excused were Mark Kleinschmidt and Dorothy Verkerk.
Staff members present were Town Manager Cal Horton, Assistant Town Managers Sonna Loewenthal and Florentine Miller, Town Attorney Ralph Karpinos, Assistant to the Manager Bill Stockard, Finance Director Jim Baker, Parks and Recreation Director Kathryn Spatz, Human Resources Director Pam Eastwood, Fire Chief Dan Jones, Police Chief Gregg Jarvies, Inspections Director Lance Norris, Engineering Director George Small, Public Works Director Bruce Heflin, Information Technology Director Bob Avery, Housing Director Tina Vaughn, Library Director Kathy Thompson, Internal Services Superintendent Bill Terry, Assistant Transportation Director Rick Hannegan, Parking Services Superintendent Brenda Jones, Traffic Engineer Kumar Neppalli, and Town Clerk Joyce Smith.
Mayor Foy announced an upcoming meeting of various North Carolina mayors, noting the projected discussions which would focus on the ½% sales tax and the other revenues not forthcoming from the State. He responded to the question asked by Mayor pro tem Evans of whether the State would keep the ½% sales tax revenue or return it to the Town, by saying that this would be discussed and he did not know the answer. He said the State could keep the revenue.
Mayor Foy proposed that all discussion on the Town budget be during today’s meeting and at a public hearing, and that a certain time be set aside at a Council meeting scheduled at the end of May for a Council vote, with no further discussion.
Mr. Horton said the Governor had transferred some funds and impounded them, which ordinarily would have had the effect of increasing the amount the Town would receive from the fund which represented the taxes collected on fuels. He said this may reduce the amount received by the Town to about $60,000. He said the State would be asked to forward reimbursement to the Towns a year early, July 1, 2002, the ½% sales tax revenues, which would replace $680,000 in the General Fund, and $50,000 in the Transportation Fund and would produce about $1.3 million. Mr. Horton recommended that the Council pursue this formula for collection and distribution with the State Legislators when they meet with them.
Mayor Foy asked if the reimbursements were the same as the franchise tax. Mr. Horton said they were not the same as the franchise tax or the beer and wine tax. Mr. Horton said if the Governor did not impound the beer and wine and the franchise taxes, the Town would be in much better shape and recommended that the Council members also pursue this recommendation at the May 2 Legislative breakfast.
Mr. Horton added that it might be a good thing to take a pause in the budget deliberations in order to see what possibilities there would be for more revenues from the State. He said the Council could adopt an interim budget, allowable by law, to determine what tax rate to set and which projects to authorize in the Capital Improvement Program and the compensation package. Mr. Karpinos had determined that a tax rate must be set by August 1, so Mr. Horton said in no circumstance would the staff authorize any delay past that date, unless the Legislature changed the law to make it possible to go beyond that date.
Mr. Horton said the format for the budget this year was to show where it reflected the Comprehensive Plan, and the key fact is that the Town is losing about $3 million and had the effect of about 7.1 cents on the tax rate. He added that by having no pay increases, holding operations expense even, and by significantly restraining the Capital Improvement Program the tax rate could go no lower than 6.6 cents. Mr. Horton said the budget was about the same as other years, with the addition of the Rental Licensing Program.
Council Member Harrison said there were no good ideas heard from any other location that were any better than the Council and staff had already heard for cutting the budget. He said legislation was really encouraging.
Mayor pro tem Evans suggested that it was important to make the Council’s budget as lean as possible, and suggested that a policy be set on attendance at conferences by making attendance at only one in-State conference the rule. Mr. Horton said that in the past attendance was for two in-State conferences or meetings.
Mayor pro tem Evans said the Council should try to adopt a policy to reduce the amount of money spent on conferences. She said it would show that the Council was also cutting back, along with the staff and the rest of the community.
Mr. Horton said the documentation of the policy was on pages 6 and 7 of the detail budget. He said in the past the Council had participated in the North Carolina League of Municipalities meetings and the Legislative session, and had participated in the National League of Cities and the Annual meeting of this League. He said in some years none of the Council had attended these meeting, and in other years several had.
Council Member Wiggins said she understood what Mayor pro tem Evans was trying to achieve, but she had not found that personally troublesome. She said some members don’t attend any meetings and others do, so it balanced out as a budget item, but she suggested that each of the members of the Council indicate what they intended to do. She said she felt the conferences were very important. She suggested working on this at another time.
Mayor Foy said he did not think the travel allowance was being abused. Mr. Horton said the staff had done the best they could to preserve funds for development for employees because they were an important resource and encouraged the staff for improvement and development. He added that there was value in Council Members participating in training, and he hoped they would not be overly restricted.
Mr. Horton introduced Pam Eastwood, the new Human Resources Director. Ms. Eastwood said the pay system recommendations had been prepared with the knowledge that the money was not there for them to go into effect, but the staff wanted the Council to know what the local market was. She said the staff had used a purchased survey for the private sector regarding pay in the area. Ms. Eastwood said the Comprehensive Pay Plan was the current status, but if there were to be funds available the Town is below both the public and private sector, the 75th percentile of the market. She said action must be taken in the future for the pay plan if the Town was to remain competitive. Ms. Eastwood said the recommendations were, if funds were available:
Scenario #1, effective October 1, 2002
· Those employees below the job rate, about 60%, would receive a step increase of 3.78% on October 1, 2002
· Average of 4.5% merit improvement for those people, 40%, at or above the job rate.
· 2.5% increase to ranges and range increases for those employees below Job Rate
Scenario #2, effective January 1, 2003
· 3.78% step increases
· 4.3% job rate increases
Council Member Bateman said it looked like giving the lower end of the job rate was hurting those at a lesser rate than those in the highest end. Ms. Eastwood said the market analysis showed that the Town was farther behind the public and private sectors on the middle and upper end of the job rates. S he said many entry-level jobs were substantially above the market average. She said another option would make the increase a flat rate for everyone.
Council Member Bateman said she would prefer that option, philosophically. Mr. Horton said this was in the lower half of all of the pay ranges.
Council Member Strom said the numbers were fluid and there will be a lot of adjustment, and he asked if it would be wiser to wait 18 months for a job study, when things have settled down more. He was concerned about the 75th percentile goal being taken so literally by the Town, instead of taking each year for making adjustments. Ms. Eastwood said if the Town waited another 18 months it will have been almost 4 years since the jobs were reviewed and some other practices would have to be adapted to make up for the comparisons. She said the job study would be done by the staff, because the staff had the information.
Council Member Harrison asked what the 75th percentile was as compared with 50th percentile. Ms. Eastwood said the 50th is the amount that half the people pay more than and half pay less than. She said the 75th is that figure that 75% of the employers pay less, 25% pay more. Mr. Horton added that the conclusion reached by Ms. Eastwood was that it may be more practical to compete with the private sector at the 50th percentile, and the public sector with the 75th percentile.
Mayor Foy asked if there was a difference in what the Health Care Systems are doing and what other public sector employers are doing. Ms. Eastwood responded that there were differences in what they were doing and what positions were not competitive with the Town’s.
Mayor Foy asked how the Town made a direct comparison with the others. Ms. Eastwood said it was based on managers making decisions on a set dollar amount. She said it was very difficult to make direct comparisons.
Council Member Strom asked if the staff was looking at the market in a weighted average in the positions, and were there any adjustments made for longevity. Ms. Eastwood explained that it averaged out.
Council Member Strom asked why towns like Mebane and Hillsborough were excluded from the survey. Ms. Eastwood said they were not excluded, but the staff surveyed the market area requested by the Council. She said it was a voluntary survey, so some of those asked did not respond.
Mr. Horton, in answer to a previous question by Mayor Foy, said the numbers 2.5 - 3.5 percent were of the total payroll; the Town’s numbers would be the equivalent of 3% of payroll.
Council Member Bateman said she would like to see an heroic effort made to place more minorities in supervisory positions.
Mr. Horton said he was recommending the options to the Council, and in the event that the State could restore funding to the Town, the first priority should be employee compensation, and restoration of Capital Improvement Projects. He said, if the first priority could not be funded, then the staff would recommend Scenario #2 to the Council for its consideration.
a. Report on Use of Town Vehicles.
Mr. Horton said staff could justify each of the items in the Report, and he would not recommend delineation of any of the equipment beyond those already reported by the staff that replacement could be deferred.
Mayor pro tem Evans said that in the past, the age of each vehicle was listed. Public Works Director Bruce Heflin said he did have that information, and the average age of the fleet, when the fleet replacement program began, was 7 years old.
Mayor pro tem Evans asked if the program could take one step back in order to save money in replacement. Mr. Horton said that Bill Terry, Internal Services Superintendent, had already done that quite aggressively this year. Mr. Terry said that on the advice of the consultant the Town had changed the financing from 5 years to 7 years to spread it out, and the black and white vehicles used by the Police Department would be replaced on a four-year schedule instead of three. He said each vehicle is assessed every year for replacement, and adjustments are made.
b. Report on Commercial Garbage Collection Options.
Mr. Heflin discussed the three options:
· Option #1. No change—continuation of basic once weekly collection at no fee and use of fees for additional services. The Manager’s preliminary base budget estimates for next year were based on no change in service. This would cost the Town about $890,000.
· Option #2. Add fees for all services to present commercial refuse collection services using fees for all services, which would raise the income by $390,000, assuming it was for nine months, and the net cost to the Town would be about $590,000.
· Option #3. Eliminate Town collection of commercial refuse. Costs to the Town would be a savings of about $830,000 on an annual basis. A nine-month basis $690,000, assuming elimination of three positions.
Council Member Strom said he wanted it to be made clear to the community that if the Council selected Option #2 the Town would still be significantly subsidizing commercial trash pick up. He asked what the fee would be to cover 100% of the Town’s cost and how much money would the Town continue to subsidize the non-residential pick up. Mr. Heflin said if Option #2 were selected, the fee would be $750 per year, based on costs and what the private sector trash pick up would cost.
Council Member Strom said that even with the fee the Town was subsidizing about $500,000 per year for this Option.
Mayor pro tem Evans asked what percent of the commercial pick up would be multi-family residential trash pick up. Mr. Terry said he would provide the numbers, but did not have them at hand.
Mayor pro tem Evans said that the word “subsidize” for multi-family residential would be the same as single family residential pick up, all of whom pay taxes.
Council Member Harrison asked if there were other area communities which were using the same approach to collecting in residential areas. Mr. Heflin said that the Town was not unique in its approach to single family zoning. He said that Colony Lakes and other like places have dumpsters, and there had been considerable discussion over the years with the Town regarding trash pick up. Mr. Horton added that it was not unusual in the region and in the country for trash collection to be done in this manner. He said one reason was these developments were high density and for profit, so that one of the considerations that governing bodies had made over the years is to ask what they are going to get in return for these considerations.
Council Member Wiggins asked why one of the disadvantages of Option #2 would be that it would not reduce the general fund expenditures. Mr. Heflin said there was the same level service with the same resource requirement, and the only change would be on the revenue side. Mr. Horton added that the net cost would be reduced.
Mayor Foy said the working paper pointed out the need for the Council to initiate some conversation with the Commissioners about solid waste policy, and for the County to start identifying the sources of funding. Mr. Horton said the staff appreciated the help given in this preparation from the County staff.
Council Member Strom said the Council needed to have a conversation with the County about when the landfill would be closing. He said it needed to have a conversation with the Commissioners to have some funding mechanisms, other than the tip fees, to give the Town some flexibility to make the solid waste reforms that it supported. Mr. Horton suggested that on April 29th the County had requested an Assembly of Governments meeting, and he could focus on this issue, and raise it as an issue for the Council to discuss, and present data collected by Public Works.
Council Member Bateman asked about elimination of positions in Option #3. Mr. Heflin said ideally the three positions would not have to be eliminated, but the turn-over in the Department had been almost none in the last 2 years, and these positions were higher level positions, and it was more difficult to make a transition. Mr. Horton said he would not recommend a layoff, but to make other options within the system available.
Council Member Bateman agreed that the Town owed this to long-term employees. Mr. Horton said these transitions would be made keeping the salaries the same for those employees affected, and the staff would try to make the transition one to use the abilities of the employee. He stated he felt that in the future, with retiring personnel, these transitions would even out.
Council Member Wiggins asked when the Council would be making the decision. Mayor Foy suggested getting all the information today, and at the next public hearing. Mr. Horton said the Council could come to some tentative decisions at the Public Hearing on May 15th and then the Council might want to pause for a while to figure out what the Legislature might do, before coming to a final conclusion.
Mayor Foy suggested a straw vote at the end of May, with a vote in June. Mr. Horton said the Council could approve an interim budget.
c. List of Planned Road Resurfacing for the Coming Year.
Mayor Foy said he felt the list would be very helpful to the Council in making decisions on what roads they wished resurfaced. Mr. Horton said the staff was not able to give the Council the effect of postponing some of the items. He said an instrument for measuring was not available.
Mayor pro tem Evans said it would seem that there might not be as much concern to postponing the resurfacing of cul de sacs, as there would be for resurfacing through streets. She suggested that the routes where buses run should be considered first. Mr. Heflin said the staff does take into consideration the amount of traffic on the road and the condition of the asphalt.
Item 4 – Transportation Department
a. Maintenance Cost Per Mile on Standard Small Buses.
Assistant Transportation Director Rick Hannegan was present to answer questions.
Council Member Ward asked if the streets could be maintained and last longer with the use of small buses instead of the larger buses. Mr. Horton said this would take a great deal of research.
Council Member Harrison said he felt the information would be helpful, agreeing with Council Member Ward, that he would like the information.
b. Report on Various Parking Issues.
Mr. Horton said the staff was still working on some of the parking issues.
Mayor pro tem Evans asked if there was a parking fee for residential parking permits. Parking Services Superintendent Brenda Jones said there was not a fee. Mayor pro tem Evans said the Town should consider charges for these permits as a revenue source. She said for leased parking, undercover, a higher rate could be charged, but she knew, from conversations with business owners in the downtown, that the more the charge at the meters, the more customers will park elsewhere where the parking is free. Mr. Horton said one of the measures the staff will apply would be what is received from non-leased spaces, and what the revenue would be per month on leased parking spaces. He said that leased fee was now $65 per month, and will go up to $75 per month or higher. He said the staff was working on charging higher fees for peak traffic hours, to encourage more bus use. Mr. Horton said it would be the objective to have no leased spaces at all, because per hour fees generate more money.
Council Member Strom said he was interested in the “smart card” technology. Ms. Jones said the last 210 meters purchased were able to accept “smart cards.” She said the proposal was to purchase cards and loaders for the cards, there was a possibility of having them on the streets.
Council Member Strom said he would be interested in a proposal for on-street cards. He said the “smart card” idea seemed like an easy way to have charges in the lots, such as Lot 3, go up to 9:00 in the evening. Mr. Horton said the lots should go up to 11:00 p.m. He stated he would bring the proposal back to the Council.
Mayor Foy said it would be appropriate for the Public Hearing discussion.
Council Member Ward asked if there were other options to extend the charges later into the evenings on week-days and week-ends. Mr. Horton suggested Sunday mornings should also have charges in the lots and the parking deck.
Council Member Ward wondered if that might cause more people to park on the streets, making the streets more dangerous. Mr. Horton said the parking on Sunday morning was very heavy on both the streets and the lots.
Mayor Foy asked if the downtown businesses and the Chamber of Commerce and the Downtown Commission could issue parking tokens for the meters. Ms. Jones said that was possible.
Mayor Foy asked what happens to people who leave their cars in the lots or on the deck overnight because they are unable to drive. Ms. Jones said there was a charge. Mr. Horton said the staff could look into the safety issue, and make some allowances if there was an early removal on the next day.
a. Status of Water/Sewer Assistance Fund.
Mr. Horton said the money is allocated, and if somebody else comes in and wishes to file a petition, the Council will have to reallocate the money now available or come up with the funding.
b. Report on Meadowmont Traffic-Calming Funding.
Mr. Horton said the funds had been pledged and spent. The Pinehurst lawsuit was not separate from the money, he said.
a. Report on Neighborhood Traffic-Calming Signs.
Council Member Harrison said he lived on a cul de sac street off Pope Road. He stated that because his street is actually wider than the main road, some drivers traverse it at high speeds, and his neighbors have complained to him. His understanding was that, since it did not connect at the end to another street, his cul-de-sac street was not eligible for a speed limit sign. Council Member Harrison is interested in seeing what kind of signage is available to help slow traffic. He also suggested that the "Dead End" sign at the head of the street was apparently not visible from some angles. He said that some drivers could not tell use it as a connector. Council Member Harrison said that most of his neighbors on the street had indicated that they themselves did not know there was a "Dead End" sign at the head of the street.
Item 7 – Parks and Recreation Department
a. Report on Savings if July 4 Celebration Concluded
Parks and Recreation Director Kathryn Spatz suggested an alternative to the traditional July 4th celebration. She suggested an alternative would be to have a downtown event with no fireworks. The Council agreed by consensus.
The meeting adjourned at 6:06 p.m.