SUMMARY MINUTES OF A BUDGET WORK SESSION

OF THE CHAPEL HILL TOWN COUNCIL

THURSDAY, APRIL 15, 1999 AT 7:00 P. M.

 

Mayor Rosemary Waldorf called the meeting to order at 7:00 p.m.

 

Council Members present were Flicka Bateman, Joe Capowski, Pat Evans, Kevin Foy, Lee Pavăo and Edith Wiggins.  Council Member Julie McClintock arrived at 7:08 p.m.  Council Member Joyce Brown was absent, excused.

 

Staff members present were Town Manager Cal Horton, Assistant Town Manager Sonna Loewenthal, Town Attorney Ralph Karpinos, Assistant to the Manager Ruffin Hall, Finance Director Jim Baker, Public Works Director Bruce Heflin, Fire Chief Dan Jones, Personnel Director Pat Thomas, Transportation Director Bob Godding, Parks and Recreation Director Kathryn Spatz and Town Clerk Joyce Smith.

 

Item 1—Consideration of Budget Working Papers as Desired by the Council

 

a.       Curbside Residential Refuse Collection

 

Mr. Heflin presented an updated version of a report previously brought to the Council.  He said that changes in the numbers were related to the method of financing equipment to lease/purchase rather than outright cash purchases.  Mr. Heflin, noting that this would mean spending money over the first couple of years, said that the eventual savings would amount to about $300,000 per year, through a reduction in personnel and equipment.  He said that about 7% of the population (about 600 people) would be exempt for medical or other reasons and would continue to be served at the back of the house as they were now. 

 

b. & c.   Yard Waste Collection Improvements and Residential Curbside Refuse and                  Yard Waste Collection Services

 

Mr. Heflin noted that there had been a gradual trend of increasing yard waste collection over the last five years.  He pointed out that yard waste constituted about one-fourth of the Town’s total collection in the residential sector.  Mr. Heflin said that this occasionally resulted in diminished service, adding that there had been times this year when the Department had not been able to meet its service objectives. 

 

Mr. Heflin said that there were various options for improving service, including:

·          adding two crews and temporary hours and collecting every other week ($331,900);

·          adding fewer resources and achieving a week certain within a given month’s service ($201,100);

·          guaranteeing once-a-week curbside garbage collection by buying pull-out carts ($42,400);

·          adding one more crew ($54,000). 

 

Mr. Heflin noted that requiring citizens to bundle their yard waste would increase efficiency.  Mr. Heflin said that there were options for that in the written report.

 

Mayor Waldorf summarized Mr. Heflin’s comments: enhancing the Town’s present curbside collection in any way would cost more money.   Mr. Heflin agreed.  He said that making an impact on the cycle over the long term would require additional resources. 

 

Mayor Waldorf remarked that the Council had asked for ideas on how to step up the frequency of curbside yard waste collection and on how to combine residential curbside trash collection and yard waste collection using the same crew.

 

Council Member McClintock said that the Town should not be picking up bags of yard waste.

 

Mayor Waldorf asked Council Member McClintock if she was speaking in support of regulations that would tell people more specifically how to put their yard waste at the curb.  Council Member McClintock replied that she was referring to the additional option on page six of Agenda Item 1b which would discontinue use of bags for yard waste. 

 

Council Member Foy asked Mr. Heflin about other options in addition to not bagging leaves.  Mr. Heflin referred to page three in Agenda Item 1b, which listed what other communities did to increase efficiency—such as requiring containers or bundles, eliminating bags, and making large loose piles.  He noted that the Town had a policy against letting yard waste piles sit.

 

Council Member Foy asked what people did when there was a limit on pile size but they could not use plastic bags.  Mr. Heflin replied that many communities required sticks and limbs to be put into four-foot bundles.  He said that roll-carts were efficient for grass clippings, as were many other containers with hard sides. 

 

Council Member Foy asked how the Town would enforce bundling with contract landscapers.  Mr. Heflin replied that it would be difficult to enforce because it would depend upon their good will.  He noted that contract landscapers often left the homeowner to deal with yard waste.

 

Mayor Waldorf suggested that both landscapers and homeowners be educated about this. 

 

Various Council Members spoke in favor of option six. Mr. Horton explained that the staff could draw up an ordinance to that effect.  The majority of Council Members agreed.

 

Council Member Pavăo asked if contractors were charged a fee for dumping yard waste at the landfill.  Mr. Heflin replied that landscapers could obtain permits from the Town and rent Town dumpsters for a fee of $12. 

 


Mayor pro tem Capowski asked if the $127,000 in option three to provide scheduled yard waste collection with once-a-week curbside garbage collection would stay constant after the second year.  Mr. Heflin replied that it would, and indicated a chart on page four that showed the cost would be down to zero by the fifth year. 

 

Council Member Evans asked if those figures included annexation and population increases.  Mr. Heflin replied that the figures reflected the system as it was in place now without assuming major changes of any kind.

 

Mayor pro tem Capowski asked if there was any way the Town could do a curbside garbage collection without investing in roll-out containers.  Mr. Heflin replied that it would be cheaper if residents took their own containers to the curb.  He added, though, that they would lack uniformity, might be heavy, and could be more susceptible to animals, wind damage and bag breakage than roll-out containers.

 

Mayor pro tem Capowski asked if the Town would save money under a plan which eliminated the oldest trucks but required buying $462,000 worth of roll-out carts.  Mr. Heflin referred to a chart in Item 1 that compared costs and savings, and explained that carts lasted a long time while trucks needed to be replaced on a fairly constant basis.  He added that the biggest savings would be in personnel, noting that maintenance costs for carts were fairly low.  Mr. Heflin noted that the budget included the cost of replacing damaged carts on an annual basis, and explained that there were various ways of maintaining carts, such as having Sanitation Department employees responsible for them.  He pointed out that some cities had their residents eventually become responsible for maintaining carts.

 

Mayor Waldorf, noting that Mayor pro tem Capowski was basically asking if this programmatic switch really would save money, said that she had heard other Council Members ask that question as well.  She said this was a legitimate concern because the reasons for switching would be to save money and to create more humane working condition for the people who collect trash.  Mayor Waldorf stated that she accepted the staff’s figures that indicated that the Town would save a penny on the tax rate every year by full implementation.

 

Council Member Evans pointed out that the design for Southern Village included alleyways for garbage pick-up.  Mr. Horton replied that the Town had never agreed to do alleyway pick-up at Southern Village. 

 

Mayor Waldorf asked Council Member Evans why her question was relevant.  Council Member Evans replied that many residents of Southern Village had driveways in the back of their houses because the Town had encouraged developers to use a neo-traditional design.  She pointed out that back alleyways did not fit well with curbside roll-out.  Council Member Evans also noted that rolling a cart was not easy for some people.  She pointed out that those over 65 might have trouble with it, as well as those who did not have a paved driveway.  

 


Council Member Evans said that she was disappointed not to see the information she had requested on once-a-week rather than three-times-a-week pick-up.  Mr. Heflin replied that staff had done some analysis on that and had given the Manager information that showed the bottom line did not change.  Mr. Heflin said the only way to achieve savings would be to reduce employees and equipment. 

 

Council Member McClintock asked if the equation would change if the Town were to have regular brush collection at the curb.  Mr. Heflin replied that it would not, explaining that what determined productivity in garbage collection was how far you travel, what you do when you get there, and how many times you do it.  He said that the Town’s current system was the least efficient of all systems because trash collectors walked the farthest distance and they did it twice a week. 

 

Mr. Heflin explained that eliminating one collection a week would lengthen the amount of pick-up time because employees would have to make more trips back to the truck.  He added that this had been confirmed by actual time studies on Town employees.  Mr. Heflin pointed out that there were only six and a half garbage routes and explained that eliminating one route would mean having to get almost 15-20% additional savings through productivity. 

 

Council Member McClintock asked if productivity would improve if the Town were organized in a different way.  Mr. Heflin stressed that the two immediate outcomes would be higher employee turnover and fewer weeks when the Department would meet its brush collection objectives.  He said that employees would find it punitive to have to collect four weeks worth of garbage at the rear of the house because it would be so physically demanding. 

 

Mr. Horton pointed out that employees would continue to collect the same volume in one route collection that they now made in two.  He explained that this would require them to make more trips back to the truck because the barrel would fill up faster. 

 

Council Member Evans asked if recycling had made any difference.  Mr. Heflin replied that they had seen only slight reductions in the total amount of tonnage, but acknowledged that there was a slight downward trend because people were recycling.

 

Council Member Foy remarked that eight employees would be eliminated with curbside collection.  He asked what effect a “pay as you throw” program might have if it were combined with once-a-week pick-up.  Mr. Heflin replied that the results from other communities varied greatly, ranging from a few percent to double-digit reductions. 

 

Council Member Foy stated that there must be some point at which a reduction in volume would be sufficient to eliminate a crew.  Mr. Heflin replied that he did not know the answer to that. 

 

Council Member Foy asked if the new routing software would have an effect.  Mr. Heflin replied that the software would interface with the Geographic Information System program and would help the Department lay out routes without the labor-intensive house counting processes of the past. 

 

Council Member Wiggins informed the Council that a number of garbage cans in Town were still sunken underground.  She asked, noting that this created difficult working conditions for garbage collectors, whether Council Members were interested in an ordinance that would speak to that as well.  Mayor Waldorf replied that she would be interested if the Town did not institute curbside collection. 

 

Council Member Wiggins stated that she believed there would not be enough votes for curbside collection and asked if the Council was interested in an ordinance to address the underground garbage can problem.  Several Council Members expressed support for that.

 

Mayor pro tem Capowski said that the issue had three components:  cost per household, working conditions for collectors, and aesthetics.  He noted that the Town would not see any substantial savings until the fourth year and would then only reach a penny on the tax rate in the sixth year.  Mayor pro tem Capowski said that the “humane issue” disturbed him, but pointed out that garbage collection was dirty, hard work regardless of whether the homeowner or the trash collector moved it to the curb. 

 

Mayor pro tem Capowski added that the aesthetics issue called for staying with side yard or backyard pickup.  He suggested making changes only in conjunction with “pay as you throw” or, if the uproar over the yard waste issue became so strong, the Town could synergize the two changes.  Mayor pro tem Capowski said that he would not vote to change the side yard/backyard system without making other changes as well.

 

Mayor Waldorf summarized the options that the Council had before them: whether to go curbside or stay backyard; several on whether—or at what level—to improve curbside brush collection; and whether to combine curbside garbage and brush collection. 

 

Council Member McClintock said that she wanted to know what the people of Chapel Hill wanted and suggested that the Town take a statistically valid survey.  She said that she did not feel comfortable moving to curbside collection if the majority of citizens did not want it.

 

Council Member Pavăo agreed with Council Member McClintock, noting he had received phone calls that favored leaving the system in place.  He noted that callers were mostly concerned about aesthetics and the ability to get roll-out carts up a gravel driveway and asked Council Member McClintock how large the survey sample would have to be.  Council Member McClintock replied that the University could assist in answering that. 

 

Council Member Pavăo expressed support for keeping the present system.

 

Council Member Foy asked Mr. Heflin to elaborate on Option IV of 1b that would provide for an increase in personnel and a realignment of assets.  Mr. Heflin explained that it would mean adding two people and keeping one more brush collection crew on the street, virtually every day,
doubling it on some days and increasing it by about 50% on others.  He said that this coupled with the preparation requirements that the Council had discussed would make it possible for the Department to reach its two-week goal. 

 

Mayor Waldorf stated that if the Council wanted to retain backyard garbage collection and increase the frequency and reliability of curbside brush collection, and do it at minimal cost, then this was the right approach.  Mr. Heflin agreed, adding that this was especially true if it was coupled with preparation requirements. 

 

Council Member Foy said that he supported the approach, but noted that it was not in the Manager’s recommendations.  Mr. Horton replied, “not yet.”

 

Council Member Wiggins asked Council Member Foy if he had seen the price tag. 

 

Mr. Horton reaffirmed that citizens complained more about brush collection than any other Town service.  He noted that it had grown worse each year for several years beginning with Hurricane Fran.  Mr. Horton said that people who called the Town staff were angrier about this than they were about parking tickets.  He pointed out that it was the one thing that the Council could do to improve the appearance of the community in a dramatic fashion, and advised the Council to keep it as a high priority.

 

Council Member Evans asked how much difference it would make if landscapers hauled their own debris away.  Mr. Heflin said that it would not make a big difference.  Mr. Horton added that it would be insignificant in most neighborhoods because most houses did not have a landscape service with that kind of volume. 

 

Council Member Wiggins expressed the desire to put this item in the budget, but added that she wanted to wait and see what would be taken out.  She commented that some neighborhoods treated curbside collection as a neighborhood watch, calling each other if trash cans had been left out too long.

 

Mayor Waldorf expressed support for adding $42,000 this year, rather than the option (Option IV from agenda #1b) which would add $54,000 this year and would be a continuing and probably increasing cost.  She cautioned Council Members that twice-a-week backyard garbage collection as the Town did it now, plus Option IV, would be expensive.  Mayor Waldorf said that many people liked things the way they were and described backyard collection as perhaps the Town’s one last really inefficient service.

 

Council Member McClintock asked if there was majority support for Option IV brush collection. 

 

Mayor pro tem Capowski proposed putting the $54,000 on the spreadsheet as one of the options for consideration.  There was general Council agreement.

 

Council Member Wiggins expressed support for Agenda Item 1c, as did Council Member Bateman. 

 

Mayor Waldorf noted that the Council had previously voted five to three to continue backyard, twice-a-week garbage collection and to consider Option IV under Agenda Item 1b.  She noted that there also was a request for the Manager to look at an ordinance to deal with buried garbage cans, adding that everyone should bring forward anything they thought of as a problem for the collectors and/or would make brush collection more efficient.  

 

Council Member Wiggins asked if the tax rate equivalent of Option IV would be .18.  Council Member Foy said that it would.

 

d.             Downtown Commercial Refuse Collection—Athens, Clarke County, Georgia

 

Council Member Evans asked if anyone could think of a better way of collecting refuse in the downtown area.  Mr. Horton replied that having the private sector provide commercial waste services and getting the Town out of the business altogether would be a better way.  He added that a number of cities were not involved in commercial collection. 

 

Council Member Foy asked how that would work.  Mr. Horton replied that the Town would give notice that after a certain date it would cease all commercial collection service and that it would then be the responsibility of anyone who needed it to arrange for service with a private company.  He said that the Town would then stop collecting on the stated date.   Mr. Horton pointed out that the Town probably would have to employ an inspector for a while to visit establishments and make sure they were receiving proper services.

 

Council Member Foy explained that businesses in many other places had trash collected by a private service as part of their cost of doing business. 

 

Mayor Waldorf asked if doing this would save the Town a significant amount of money.  Mr. Heflin replied that the cost this year for commercial collection was about $926,000, not including revenues for those who received an extra two collections per week. 

 

Council Member Foy requested the staff’s recommendations, noting that it was not just a cost issue but a fairness issue as well. 

 

Council Member Evans asked if there were North Carolina companies set up to do commercial collection.  Mr. Heflin replied that there were, noting that Raleigh, Cary and Garner used such services, while Durham, Charlotte and Winston-Salem used a combination of private and municipal collection. 

 

Mayor Waldorf agreed that the possibility was worth looking at in the future. 

 

Council Member Foy quipped that it would be the “ultimate ‘pay as you throw.’” 

 

Mayor Waldorf noted that it would not necessarily lead to waste reduction.  Mr. Horton said that it would create a clear understanding in the private sector between how much they pay and how much they throw. 

 

e.            Comparison of Council Members’ Salary and Calculation as a Percentage of the Total Budget

 

Council Member Foy suggested that Council Members’ salaries be linked to the same annual increase granted Town employees.  He said that the policy should be passed once and should not have to be revisited. 

 

Council Member Evans, referring to a chart in the Manager’s report, noted that towns with higher Council salaries also had higher budgets than Chapel Hill. 

 

Mr. Horton pointed out that those budgets were higher because those towns were providing utilities as well.  He added that while Chapel Hill’s budget did not include utilities, it included a bus system, landfill and library.

 

Council Member Wiggins, remarking that she and Council Member Foy probably were the only Council Members interested in raising salaries, asked the Council to consider limiting the number of meetings they had if they did not intend to raise compensation.  She pointed out that there already had been four meetings that week, adding that Council Members served as liaisons to other boards and committees as well. 

 

Mayor Waldorf asked if anyone else was interested in the salary issue.  Council Member McClintock replied that it sounded reasonable to her since it was not very much money.

 

Mayor pro tem Capowski stated that the chart showed that Council Members’ salaries were neither too high nor too low, adding that he would not support raising salaries if they raised taxes this year. 

 

Council Member Foy argued that a 4% raise for all Council Members would total about $3,000 annually.  He said this was insignificant considering the total budget, and pointed out that the last time the Council’s salaries were raised was 1986.  He argued that it would be better to have an annual increase that was linked to other Town employees’ raises than to go for years without a raise and then increase it by 100%.

 

Council Member Wiggins agreed, pointing out that the chart did not have a column for the number of Council meetings. 

 

Council Member Evans expressed the wish that compensation were linked to numbers of hours spent so that citizens could understand what they were paying for. 

 

Mayor Waldorf suggested asking the Manager to calculate an increase of 4.75% in the Council’s salaries.   

 

f.               Increase in Town Workers’ Compensation Premiums 

 

Mayor Waldorf said that this issue seemed clear to her. 

 

Mayor pro tem Capowski asked if there would be higher and higher premiums for the next decade. Pat Thomas, Personnel Director, replied that she would expect so because premiums were based on actual payroll.  Mr. Horton added that some of the increase had been a function of aberrational claims experience.  He noted that the Town had had good experience for a number of years, but pointed out that there would be bad experiences and that it took time for the repercussions of those to work through the system. 

 

Mayor Waldorf noted that a police officer had had her fingers shot off, resulting in significant workers’ compensation.  Mr. Horton added that a Fire Department employee had to retire much earlier than would be expected because of a bad back.  

 

Mayor pro tem Capowski asked if the Wellness Program had helped.  Mr. Horton replied that the Program was not developed enough to be evaluated in that way.  He said that the safety aspects had saved the Town money, but the wellness aspects, which were limited to Police and Fire Departments, could not be generalized.

 

g.            Cost Estimate for Black Public Workers Association (BPWA) Salary Increase Proposal 

 

Mayor Waldorf presumed that the Council could not approve this $1 million expenditure even though they might like to. 

 

Council Members McClintock and Evans noted that $1 million was an immense amount of money.  

 

Council Member McClintock said that changes to the pay system would address the concerns behind this request.  Ms. Thomas said that the changes would help employees with up to five years of service, but that the BPWA had been targeting those with more than five years of service. 

 

Council Member Bateman asked what the current longevity schedule was.  Ms. Thomas replied that it was $500 at five years, $650 at 10 years, $800 at 15 years, $1,000 at 20 years, $1,200 at 25 years.  Mayor Waldorf added that this compensation was paid in a lump sum.  Mr. Horton noted that it was much appreciated and considered one of the most valuable benefits provided to Town employees. 

 

Mayor Waldorf repeated her opinion that the Town could not approve the request this year.

 


h.             Report of Revenue Growth in the General Fund 

 

Mayor Waldorf stated that this was clear and no discussion was necessary.

 

i.               Parking Rental Rates 

 

Mayor Waldorf suggested that the Town become a “price leader” and charge whatever they could. 

 

Bob Godding, Transportation Director, said that they had found only one other rental operation within the Town that charged more than the Town did.  He noted that the Council had increased rates by $5 last year, adding that he was comfortable leaving them as they were. 

 

Mr. Horton said that he would be comfortable raising them $5 more, from $60 to $65.  Council Members agreed. 

 

Mayor pro tem Capowski asked if there was a good balance between the number of places the Town rented monthly, or should it rent more of fewer lots.  Mr. Godding replied that the Town had two lots that were exclusively monthly rentals: Lot 4 and Lot 6, which were too small to change; and Lot 5, which included some meters.  He added that staff were in the process of monitoring Lot 5 to see if it would be better utilized as hourly spaces, or converted to a staff lot, or maybe eventually converted to a parking deck.

 

Mr. Horton added that the Town had reduced the number of spaces available for lease in the Rosemary Street parking deck.  He said it continued to lease 50 of the 305 spaces, noting that this had declined from 100 a few years ago.  Mr. Godding said that the Town made more money from hourly parking.  Mr. Horton added that the turnover at Lot #2 was high and the Town made a good return there.  He pointed out that the Town was not achieving that rate of return at the Rosemary Street parking deck, but added that it was getting closer each year.

 

j.               Parking Violation Rates—Fire Lanes 

 

Mr. Godding supported the recommendation to increase fines as they were laid out in item #1k,  including increasing fire hydrant violations to $100, the same as they were for handicapped parking violations.  He said that the Fire Department supported this increase as well.  Mr. Godding agreed that raising the general meter violation from $10 to $15 was reasonable and that other violations, such as blocking loading zones and bus zones, should be increased from $20 to $40.

 

Council Member Bateman asked for the estimated revenue difference.  Mr. Godding replied that he could provide that at a later date. 

 

Council Member Evans said that it was logical to have the same fines as the University because people did not know whether they were at a Town or a University meter. 

 

Council Member McClintock supported the fire zone increase, and the other recommendations, as well. 

 

Mayor Waldorf said she also supported the proposal. 

 

Mr. Horton pointed out that Mr. Godding and the Parking Services Division had made changes in the way they responded to citizen inquiries.  He said that this had resulted in a significant decline in the number of complaints and appeals to the Town.

 

k.             Information Report Concerning Fines at UNC-CH 

 

Mr. Godding noted that University rates were higher than Town rates and that the University gave more permits, such as loading/unloading permits. 

 

L.            Potential Resource Reallocations 

 

Mr. Horton pointed out that the Council had asked the staff to look over the budget for potential reallocations.  He explained that the staff had focused on the General Fund and concluded that changes requiring layoffs would not be reasonable given the service needs of departments.  Mr. Horton said that the staff believed that no undue harm would be caused if the Council acted on the following recommendations:

·           eliminate the proposed grant to Triangle Land Conservancy ($20,000);

·           reduce hotel/motel occupancy tax grants to others ($14,500);

·           hold vacant one Recreation Specialist II position in the Parks and Recreation Department’s “mainstream” program ($36,100);

·           hold vacant one police officer position in fiscal year 1999-2000 ($34,000); and

·           hold vacant one construction worker position in fiscal year 1999-2000 ($30,500). 

 

Mr. Horton pointed out that the total savings available through these reallocations would be $135,000.

 

Council Member Bateman asked how many vacant positions the Town had.  Mr. Horton replied that there were 14 or 15 and that most of them were recent vacancies. 

 

Council Member Foy noted that this would basically be a trade for six firefighters, which would cost $140,000.  He expressed support for the Manager’s proposal. 

 

Mayor Waldorf noted her support, but said she regretted losing a construction worker who could build sidewalks.  She asked the Manager if he could predict the loss of productivity in the Public Works Department if the position were held vacant.  Mr. Horton replied that he could not because the Town had never had a full crew there long enough to get a sense of what it could do.

 

Mayor pro tem Capowski noted that $134,000 was 4/10 of a penny on the tax rate, and expressed support for the Manager’s suggestions.  He said that he would like to see them on the spreadsheet, at least. 

 

The Council unanimously supported the Manager’s recommendations. 

 

Mayor Waldorf repeated that she was disappointed over not getting a construction worker to help build sidewalks.  Mr. Horton replied that the Town was finishing up the sidewalks on Piney Mountain Road, and would soon be working on Oxford Road.  He said they would work on Weaver Dairy Road after that. 

 

Council Member Foy explained that Engineering Director George Small had told him that the Town was having trouble getting contractors to bid on the Raleigh Road sidewalk.  He asked how extensive that problem was and what could be done about it.  Mr. Horton replied that there might be trouble getting contractors to bid on federally funded projects, with federal wage rates and federal stipulations.  He added, though, that the Town usually did not have trouble obtaining bids, eventually. 

 

Council Member Wiggins asked how many people were on the sidewalk crews.  Mr. Horton explained that it depended on what they were doing, the stage of construction, and the kind of traffic that was there.  He added that there typically were three to four people on a crew. 

 

Item 2—Consideration of 1999-2000 Budget Priorities as Desired by the Council

 

Mayor Waldorf, referring to the spreadsheet provided, asked if there were any items that Council Members wanted to keep in this year’s budget that were not part of the Manager’s preliminary recommendation. 

 

Council Member Foy said that he was convinced that the Town Clerk needed assistance and would like to continue to talk about that. 

 

Council Member Bateman proposed earmarking $100,000 from Fund Balance for sewer assistance. 

 

Jim Baker, Finance Director, said that Fund Balance had improved this year but was still low when compared to other jurisdictions of the same size.  He argued that the 10-11% level was the minimum that the Town needed to adequately protect its bond ratings and to protect itself against emergencies.

 

Mr. Horton pointed out that designating $100,000 for sewer assistance would mean that money would no longer count.  He agreed that the balance was at the minimum and noted that some might suggest that it should be two to three times higher because the Local Government Commission in North Carolina was very stringent. 

 

Mayor Waldorf noted that the Local Government Commission’s recommended ratio was 8-12%.  Mr. Horton replied that the Commission had written a letter to the Town last year noting that the Town was 1/3 to 1/2 below where they should be. 

 

Council Member Bateman said that, in that case, she would like to leave sewer assistance on the list for discussion. 

 

Council Member McClintock suggested keeping it in the budget, but at $50,000. 

 

Mayor pro tem Capowski expressed confusion about why the Town’s Fund Balance of 10-11% was considered inadequate by the Local Government Commission, whose recommended standard was 8-12%.  Mr. Baker explained that the official stated policy was that 8-12% was a minimum amount that a jurisdiction should maintain.  He added that the Commission grouped cities according to population and made comparisons that showed that most of the other cities in Chapelill’s comparison group have significantly hnbigher fund balances.  HHUHH

 

HHH Hill’s comparison group had significantly higher balances. 

 

Mayor pro tem Capowski stated that this year’s budget consisted of add-ons to last year’s.  Mr. Horton replied that it was a reformulated base budget that was similar to last year’s. 

 

Mayor pro tem Capowski, noting that they would have to levy a tax increase this year, pointed out that the Town must look hard at its philosophic decisions in the base budget and create a list of expenditures that could be eliminated. 

 

Mr. Horton replied that the staff had provided such a breakdown in the preliminary report and would be providing one again in the final budget.  He added that the Council could further restrict the amount of grant money in either the hotel/motel area or in human services.  Mr. Horton agreed to present the information in a form that would be easy to understand.

 

Council Member Evans supported Council Member Foy’s suggestion to add the yard waste brush collection enhancement to the list. 

 

Council Member McClintock said that she would like to put $10,000 back into the Manager’s budget for NC 86 landscape improvements for those who needed it the most, with the idea that the Town would do more next year.  She also recommended that the new computer analyst be the one to upgrade the website as part of his/her duties, rather than hiring someone else for that purpose.  Council Member McClintock also said that she would like more information on the stormwater management engineer, adding that she wondered about sharing that position with the County. 

 

Council Member McClintock stated that she had some concerns about downtown cleaning, and asked if the Town could use a small amount of money and make a big difference.  Mr. Horton replied that it was difficult to determine whether small increments would make a big difference. 

 

Council Member McClintock asked what the Parks and Recreation Department would be losing if the position were not funded.  Mr. Horton noted no significant effect should be realized.  Katherine Spatz, Parks and Recreation Department Director, said that the real opportunities for growth in programming were in special events, particularly for teens, and for a liaison with the schools. 

 

Council Member Bateman pointed out that not funding the position would not curtail anything the Department was currently doing.  She added that she and Ms. Spatz had discussed some ideas for creative shifting of positions.  Ms. Spatz replied that the Department could get by using the funding for a half-time special event assistant for a half time mainstreaming special event person instead, and then hiring a full-time teen arts employee.   

 

Mayor Waldorf suggested that the Council go through the list of potential add-ons, do a straw vote to give the Manager direction, and then go through his potential list of adds and give him some direction on that as well.

 

Mayor pro tem Capowski noted that there was a $31 million General Fund budget, two-thirds of which (roughly $20 million) was salaries and benefits.  He pointed out that the biggest item on the spreadsheet was the $710,000 for the 4.75% salary increase.  Mayor pro tem Capowski pointed out that dropping that increase down to 4.5% would save $20,000 and dropping it to 4.25% would save an additional $20,000.  Mr. Horton explained that this was because of the changes that the Council’s new pay system would make, such as alleviating compression and other problems.  He explained that it did not arithmetically relate to the percentages because there were other costs built into it.

 

Ms. Thomas added that the reason dropping .25% or .5% did not save much was that it primarily affected people who already were over the job rate, which was about 35% of the workforce.  She explained that the remaining employees, who were currently in the bottom half of the salary range, would be getting compression adjustments, which was where the big costs were.

 

Mayor pro tem Capowski asked if the whole thing was scaleable, meaning if the Council agreed to $500,000 rather than $710,000 the staff could still “perform magic.”  Mr. Horton replied that it would be difficult to answer that question because of the number of changes in the new employee pay system.  Ms. Thomas added that the staff would have to start over and find out which of the consultant’s recommendations the Council wanted to eliminate.

 

Council Member Bateman suggested getting back to the list of expenditures that the Council wanted to discuss before focusing on any one.  She asked if the request for $11,000 from the Human Services Advisory Committee was included under “grants to others,” noting that the Council had agreed to add it.  Mr. Horton agreed that it needed to be added. 

 

Mayor Waldorf confirmed that it was a 7% increase, and added it to the list. 

 

Council Member McClintock asked if it was correct that the Town was not proposing moving salaries to the 75th percentile this year.  Ms. Thomas replied that the Town could not do that this year because they did not have the data. 

 

Council Member McClintock asked why they needed to do the job classification market study this year.  Ms. Thomas replied that those studies take about six months to do.  She explained that it would start on July 1st and the data draft should be in by January to be folded into next year’s budget figures on October 1, 2000. 

 

Council Member McClintock asked the staff to make a list of all the components of the new pay plan and to identify which would be the least odious to consider reducing.  Mr. Horton replied that they were working on a pay report that would do that, but were not far enough along in the process to present it tonight.  He explained that the pay report would show what each element would cost, but noted that the elements were interrelated and said that it would be challenging to pull individual costs out. 

 

Ms. Thomas noted that the $710,000 in the General Fund was only about $20,000 more than last year.  Mr. Horton added that the Council had directed a good process that had resulted in good recommendations for a much improved employee pay system.  He argued that the basic recommendations were sound and were essential to help the Town get out of the mess that it was in and be able to recruit and retain good people, particularly at the lower levels.

 

Mayor pro tem Capowski asked what would happen if the Council asked the staff to use 5/7th of the money.  Mr. Horton replied that he thought they would come back to the Council asking what kind of a pay system the Council wanted to have. 

 

Mayor Waldorf said that the money and time spent on the pay consultant would have been wasted. 

 

Council Member Bateman asked if the plan could be phased in, one section of the pay scale at a time.  Ms. Thomas said that implementing it later, but having the same percentages, would keep the same system, but would cost less for this fiscal year.  She pointed out that they already were planning a two-year implementation that would address key issues first, such as compression.  Ms. Thomas repeated her suggestion that changing the date might be the simplest way to save money.

 

Council Member Bateman said that she hoped the staff understood where the Council was coming from.  She noted that there were budget pressures now that did not exist back in the fall when they began this process. 

 

Mr. Horton said that he respected the need to review things as carefully as possible.  He pointed out, though, that the amount of money the Town needed to spend on increased pay for employees would be substantial every year because employees were the most valuable asset the Town had and constituted the bulk of the cost.  Mr. Horton advised the Council to move ahead with its original plan.

 

Council Member Foy said that he read the chart to say that if there were no merit increases for people above the midpoint it would still cost an extra $300,000.  He asked why the Town could not keep the portion of the $710,000 that was needed to resolve compression issues and reduce the percentage of increase in other salaries.  Mr. Horton replied that the staff could look at that and tell the Council what it might be but could not speculate tonight.  He said that if the recommendation was to cut the amount to $500,000, the staff would make a recommendation of how best to do that. 

 

Council Member Foy said that he did not see how doing this would destroy the Council’s efforts from last fall to try and do something about compression problems. 

 

Council Member Wiggins suggested following Ms. Thomas’ suggestion and changing the date of implementation while leaving the plan intact.  She noted that the State had done that on numerous occasions and argued that this would be a more equitable solution and one that employees would understand.  Mr. Horton pointed out that Town employees were invested in the plan and would be disappointed if it were dismantled now. 

 

Mayor Waldorf added that she personally would be disappointed if the Council took the plan apart.  She recalled that several Council Members had been unhappy with the pay plan for several years.  Mayor Waldorf said this had lead to the decision to hire a consultant, invest that money, and give every Town employee an opportunity to participate.  Mayor Waldorf, noting that more than half of the employees had participated in the study, said that she would be concerned if the Council started dismantling the plan now. 

 

Council Member Foy countered that the 4.75% option could be worked backward without having to dismantle the plan.  He asked why there could not be 2.25% rather than 4.75% increase.  Ms. Thomas replied that a below market increase would make the Town’s salaries less competitive. 

 

Council Member Foy asked if doing so would dismantle the plan, and Ms. Thomas replied that it would undermine part of what the Town was trying to do, which was to remain competitive with pay increases granted throughout the range. 

 

Mr. Horton pointed out that people who had been employed by the Town the longest would receive the least.  He said that he agreed with Council Member Foy’s point, however, that the system could be scaled down, and offered to bring back a report on the potential effects and savings.  Mr. Horton cautioned that the competitive and senior employee effects were important as well. 

 

Mayor pro tem Capowski said that he hoped the staff did not think the Council was suggesting giving 0% increase to all employees.  Mr. Horton replied that he hoped the Council was not considering giving the senior group of employees only 2.5% in a year in which the labor market had moved to 4.5%. 

 

Council Member Wiggins again suggested delaying implementation.  She recommended asking the staff when the Town should begin implementing the plan in order to save the $200,000 that Mayor pro tem Capowski had suggested. 

 

Council Member McClintock noted that it was too early to make a decision on this before they even had a budget.  She agreed that the idea of delaying implementation had merit, and said that she also agreed with Council Member Foy’s request to take another look at the figures. 

 

Mayor Waldorf asked Mr. Horton if he understood what Council Members wanted.  Mr. Horton replied that the Council wanted a chart showing what the savings would be, week by week, for pushing implementation back.  He said that they also wanted to scale it back, quarter point by quarter point, to see what the impacts would be.  Mr. Horton said he might also try a combination that would have a portion go into effect on October 1st and another portion go into effect on January 1st.  He added that the staff would try to be creative and assured the Council that the staff understood the difficulty the Council was facing.  Mr. Horton said that he intended to present options that would preserve the pay system which the Council and the employees had worked so hard to develop.

 

Council Member Wiggins advised the Manager to keep it simple. 

 

Council Member Pavăo said that it needed to be simple, competitive with the market, and equitable for employees. 

 

Mayor Waldorf pointed out that there was no way around having a local government budget that was two-thirds employee costs.  She added that she increasingly believed that it was better to equitably compensate the people that you had and try to motivate them to be the best employees they could be, and if you have to make cuts, cut a service. 

 

Council Member Pavăo added that in any service organization the highest cost was the employees.  He noted that this was also the biggest asset and it had to be protected.

 

Mayor Waldorf added $4,000-5,000 for Community Cuisine to the list of items for consideration.  She took a straw vote on the list:

·          Five Council Members voted in favor of the Town Clerk’s assistant. 

·          Three voted for sewer assistance at a level of $50,000. 

·          Five voted for $54,000 brush collection enhancement. 

·          Five voted for $10,000 (or more) for NC 86 landscape improvements. 

·          No one voted for $36,000 for teens and events coordinator. 

·          Five voted for $11,000 to increase appropriation for the Human Services Advisory Commission. 

·          Five voted for $3,000-5,000 for Community Cuisine. 

 

Mr. Horton verified that the vote was to determine which items had majority support for staying on a consideration list.  He stated that these included the Town Clerk position with five votes,  the brush proposal with five votes,  NC 86 with five, human services with five, and Community Cuisine with five votes.

 

Mayor Waldorf suggested going through the Manager’s list.  She noted that the Council had discussed the pay system amount and questioned whether the Town had to do the Job Classification and Market Study this year.  Mr. Horton replied that it needed to be done every four years.  He added that the Town needed an outside objective review so that they could be certain they had the best data, especially if they were planning to carry the program out fully into the 75th percentile.  Mr. Horton said that he recommended it.

 

Mayor Waldorf, noting that they had created a short add list, asked if there was anything in particular that anyone wanted to question or ask about or encourage others to delete.  Council Member McClintock questioned the stormwater engineer, as did Mayor Waldorf and Council Member Wiggins.  Council Member Wiggins suggested putting it on hold until they got a job description and the report on joint funding. 

 

Council Member Foy asked what “alternate services” for the Town Attorney meant.  Mr. Karpinos replied that increasing the alternate services budget for hiring outside attorneys was in place of hiring a second attorney. 

 

Council Member Wiggins asked about the Sanitation Department’s crew and truck.  Mr. Horton explained that the staff had included funds in the preliminary proposal for annexation costs based on the belief that it would be timely to annex the Southern Village site.  He expressed concern that costs would exceed revenues if the annexation were effective July 1, 2000.  Mr. Horton explained that the fire station might not be ready by then, leading the staff to recommend postponing annexation for a year.  He added that he would have better data for the April 28th Budget Work Session, but the staff might recommend postponing hiring the sanitation crew for another year.

 

Mayor Waldorf stated that if there were no further questions the Council would get further reports on April 26th and then have a work session on the 28th. 

 

The meeting was adjourned at 9:45 p.m. 

 

 

 

The minutes of April 15, 1999 were adopted on the 24th day of May, 1999.

 

 

 

                                                                                                __________________________________________

Joyce A. Smith, CMC

                                                                        Town Clerk