SUMMARY MINUTES OF A WORK SESSION
OF THE CHAPEL HILL TOWN COUNCIL
WEDNESDAY, MAY 19, 2004 AT 4:00 P.M.
Mayor Foy called the meeting to order at 4:00 p.m.
Council members present were Sally Greene, Ed Harrison, Cam Hill, Mark Kleinschmidt, Bill Strom, Dorothy Verkerk, Jim Ward, and Edith Wiggins.
Staff members present were Town Manager Cal Horton, Deputy Town Manager Florentine Miller, Assistant Town Manager Bruce Heflin, Town Attorney Ralph Karpinos, Interim Public Works Director Bill Terry, Planning Director Roger Waldon, Fire Chief Dan Jones, Interim Finance Director Kay Johnson, Parks and Recreation Director Kathryn Spatz, Transportation Director Mary Lou Kuschatka, Engineering Director George Small, Police Chief Gregg Jarvies, Inspections Director Lance Norris, Information Technology Director Bob Avery, and Town Clerk Joyce Smith.
Item 1- Presentation of Proposed Budget Revisions as Requested by the Council
Noting that the Council had requested a significant reduction in the proposed 4.3-cent increase on the tax rate, Mr. Horton presented a revised recommended a budget that would allow a combined tax rate increase of 1.8 cents, or about $18 per $100,000 of assessed property. He also strongly recommended that the Town develop a stormwater utility this year that would charge residents $39 per 2,000 square feet of impervious surface, with modifications allowing for smaller increments as the year progresses. Mr. Horton then reviewed the following summary of changes from his original recommended budget:
General Fund
The revised recommended General Fund Budget would require a tax rate increase of 1.04 cents and the recommended revisions are listed below.
Personnel
Revisions to the personnel costs include:
· Moving the start date for competitive employee pay adjustments by one month from October 1, 2004 to November 1, 2004.
· Moving the start date for a web programmer analyst position to January 1, 2005.
· Correction of an error to eliminate savings from organization changes in the Fire Department, mistakenly shown as $4,600 earlier.
· Elimination of an information systems technician position, a senior planner position for current development, and three high school interns for the summer.
A Traffic Signal Technician position is retained, because the position would be fully funded by reimbursements from the North Carolina Department of Transportation.
The cost to increase health insurance for Council members to full-time coverage has been added as an increase of $40,926.
Operating Costs
Revisions to proposed operating costs include:
· Reduction of $2,500 in the estimated cost for an update of aerial photography topographical Geographical Information System ($42,500).
· Stormwater fees that the Town would need to pay ($40,000).
· Decrease in vehicle replacement charges ($151,000).
· Increase in projected charges from Orange County for animal control services ($20,000).
· Increase in transportation planning grant match requirements ($34,000).
· Replacement cost for police mobile data units ($60,000).
· Increase in the projected cost of fuel ($21,000).
· Elimination of aggregate increase in departmental operating costs and increased cost of road resurfacing materials.
Debt Service
· Addition of $55,000 in cell tower rental fees to help pay General Obligation debt service (previously included in base).
Transfer to Capital Improvements
· Transfer of cell tower rental fees from Capital Improvements Program to debt service.
· Reduction in the Capital Improvements Program by $320,000.
Special Programs and Service Contracts
· Reduction of $5,000 in amount for support of Public Art Program to equal 2003-04 budget ($70,000).
Revenues
· Increase in Stormwater Management Utility first year impact ($25,000).
· Increase in Federal Emergency Management Administration tipping fee reimbursement estimate ($5,000).
· Addition of donation from Carol Woods ($125,000).
· Upward revision of sales tax estimate ($42,000).
Transportation Fund
The revised recommended Transportation Fund budget would require a tax increase of .76 cents. Recommended revisions are listed below.
Personnel
· Moving the start date for competitive employee pay adjustment by one month from October 1, 2004 to November 1, 2004.
Operating Costs
· Increase in the Town’s portion of the projected cost of gasoline ($3,652).
In summary, Mr. Horton said that the revised recommended budget would require a tax rate increase of 1.04 cents in the General Fund (from 50.2 cents to 51.24 cents) and would require a tax rate increase of .76 cents in the Transportation fund (from 5.1 cents to 5.86 cents). The combined tax rate increase would be 1.8 cents, which would be a total of 57.1 cents per $100 of assessed property, he said.
Council Member Strom pointed out that some formerly recommended capital improvements had unconventional funding sources. He noted that the Wallace parking facility, for example, would be funded through the Parking Fund. Council Member Strom confirmed that there was no suggestion to move money from the Parking Fund into the General Fund. He had formerly suggested using that $76,000 to put that deck into the possible mix at Lots 2 and 5, he said, and he asked why the Manager had not recommended that.
Mr. Horton replied that he would not recommend dropping the maintenance schedule, since decks become more expensive when maintenance is deferred. The Town could defer portions until the Council is clear about what it wants to do, he said. But he advised them to proceed with raw maintenance, such as repairing concrete and irrigation systems. Council Member Strom remarked that insulation of an upper deck drainage system could be eliminated if the plan was to put residences and a roof system over that structure. Mr. Horton agreed and recommended that Council members hold that money until they reach a decision.
Assistant Town Manager Bruce Heflin agreed with Mr. Horton's statement. The Y2000 maintenance plan included maintenance of the concrete and other components of the deck, particularly in the plaza area, he said. Mr. Heflin noted that there was a leaking problem at the deck and explained that the leak could ultimately compromise other systems. Mr. Heflin agreed with Mr. Horton that the maintenance plan should be followed until the Town determined some other possible use of the top level.
Mr. Horton stated that the Town might need to figure out how to pay normal debt service and operating costs in the absence of a regular income stream from Parking Lots 2 or 5. And it will need as much financial strength in the parking system as possible if it gets to that point, he said. Mr. Horton advised Council members to conserve the funds that had been, and would likely be, accumulated in the parking system.
Mayor Foy ascertained that the Parking Reserve Fund was on page 207 of the budget. Interim Finance Director Kay Johnson explained that there were two funds: one for on-street and one for off-street parking. The parking deck was in the off-street parking fund, she said. Ms. Johnson noted that proceeding with maintenance charges to the fund would mean that the remaining undesignated fund balance at the end of next year would be approximately $233,000. Mayor Foy verified that there was about $300,000 in the fund, if the Town did not do the maintenance. He asked why it mattered if maintenance was done now or not if was merely money being shifted, or not, out of the fund. Mayor Foy determined that this was in the budget because the staff needed the Council's authorization to expend the funds in that way.
Council Member Strom asked if these funds were included in the $5 million reserve or if there was a separate line in the budget. Ms. Johnson explained that the $4.8 million General Fund reserve included the $800,000 that the Town uses for designated fund balance.
Mayor Foy suggested not going through the recommended changes line by line. He reminded Council members that anything they do not discuss would become part of the budget. Mayor Foy noted, for example, that the three high school summer interns was not in the budget, and he recommended putting that item back in. Some Council members expressed a preference for going line by line.
Mayor Foy proposed moving the effective date of employee pay adjustments to October 1, 2004 rather than November 1, 2004. Mr. Horton said that the staff would be delighted if it was moved to October 1st and the Council retained the recommended 4% merit increase.
Mayor pro tem Wiggins expressed support for moving the date to October 1st and suggested polling the Council on that.
Council Member Ward did not think the Town could afford 4%, he said. Council Member Ward asked what 12 months worth of 4% would equal next year. Human Services Director Pam Eastwood replied that it would be $980,000. Mr. Horton stated that the total cost would be $1,224,000, including costs for all recommendations that had been made on an annual basis in all funds. These include Parking at $21,000, Housing at $32,000 Transportation at $253,000, and General Fund at $917,000, he said.
Council Member Ward commented that the number before the Council was only a portion of what the Town would inherit next year. He inquired about the ramifications of changing that number to one lower than 4%. Ms. Eastwood replied that the Town had done flat percentage amounts for the past two years and that the pay plan was proposing doing adjustments for below and above job rate people. In addition, the plan proposed adjusting the steps themselves so that they are 4% apart rather than 3.78% apart as she and the Council had discussed in January, she explained. Ms. Eastwood said that the goal was to bring employees in the bottom half of the pay range up to the midpoint job rate for their position. The staff would also make adjustments to ensure that the range itself stays current with the marketplace, she said.
Council Member Ward asked why the Manager could not distribute 3% in a combination of flat rate increase and merit pay. Ms. Eastwood replied that that amount would not be sufficient to break into two pieces and make a substantial difference in an employee's total compensation. Mr. Horton remarked that it would essentially mean abandoning the notion of the pay plan and going to a policy similar to the State's, where the Council would decide each year what the amount would be. He believed that the State's practices had lead to long term difficulties, Mr. Horton said. He told Council Member Ward that he respected the reasons why he was wrestling with this notion but could not endorse it.
Council Member Verkerk stated that an inherent problem with the step plan was that two people doing the same job get the same raises even if one is doing it well and the other is not. This is bad for morale, she said, adding that many companies had abandoned such an approach. Council Member Verkerk wondered if the Town could move to an all merit 3% increase. Mr. Horton replied that they could if they wished to abandon the pay plan. He pointed out that the staff had created the system after nearly two years of work with employees and the Town Council.
Mr. Horton explained that one portion of the pay plan was intended to move employees to the area job rate and the other portion allows those above the job rate a set amount of money that is divided based on the ratings of employees. The intent was to provide pay steps for persons who are in the beginning of their service and variable rates for persons at or above the job rate, based on performance, he said. Mr. Horton noted, however, that the Town had not had any merit increases. "We're sliding right back into the mess that we were in a couple of years ago when we had so much compression that a lot of senior to junior employees were virtually within the same pay level," he said. Mr. Horton expressed concern that getting back into that situation would make it as hard to get out as it was the first time.
Council Member Verkerk explained that she was not balking at 4% because she begrudged the money. She works with the people who write those checks who are getting only 2% raises themselves, she said. Mr. Horton replied that he understood, but pointed out that by paying employees reasonably well the Town had been able to hold down other expenses. The problem was trying to find the right balance, he said, adding that he would always favor paying employees decently and expecting them to do better than average work in return for being treated fairly.
Mr. Horton pointed out that the Council had a good record of treating employees fairly and said he hoped that would continue. He did not mean any disrespect for the Council, he said, explaining that he was making his comments solely out of his belief that employees will do their best if the Town Council is able to continue the kinds of policies that they've had in the past.
Council Member Greene ascertained that 4% was the lowest increase that would allow the Town to implement the merit system it wants. Mr. Horton pointed out that the Council always had the option to change the steps in the merit system so that they were 3% apart rather than 3.78% or 4% apart. He did not think that would be the kind of difference the Council would want to have between experience levels, he said, but it would be better than nothing. Mr. Horton noted that doing so would require a basic change in the alignment. It would be very difficult to do, he said, and there would be difficulties in explaining it to employees.
Mayor Foy remarked that, since the current steps were 3.78%, changing the increase to 3.78%" could work. Ms. Eastwood explained that doing so would give the people in the bottom half one step and merit would be assumed to be a part of that step. Mayor Foy pointed out that increasing it by 4% and changing the pay range to 4% would accomplish the same thing.
Mayor pro tem Wiggins expressed agreement with Mr. Horton's comments about the positive effect that 4% would have on employees. She assumed he meant that employees who feel well compensated will be in a better frame of mind to work with inconveniences because they would feel more committed to the organization in this tight budget year and would feel that the Town had at least addressed them as individuals. Mayor pro tem Wiggins urged Council members to focus on the work environment and work conditions for employees.
Mayor pro tem Wiggins asked why the Police Department needed to replace guns if their guns were not being frequently used. Mr. Horton explained that there were new training requirements that meant a greater use of weapons than in the past. Mayor pro tem Wiggins stated that this was one item that she would not mind eliminating. She stated that guns were becoming obsolete because they were being used so much for training rather than for law enforcement. Mr. Horton pointed out that these were State requirements. Mayor pro tem Wiggins recommended that the Council look at items that support employees and let some of the other things take a lower priority.
Mayor Foy noted that the Council could decide on a 3.78% increase, stick to the step system as it is, and not disrupt the pay plan. He ascertained from Ms. Eastwood that this would lead to about $100,000 savings per month. Ms. Johnson pointed out that the savings would be about $40,000 if the pay plan were implemented in October.
Council Member Ward remarked that a 3.78% increase was more than he could justify asking taxpayers to subsidize. He was concerned about this year and even more concerned about next year, he said. Council Member Ward said that he would go along with the increase, however, if the Council maintained a November 1st starting date. Ms. Eastwood agreed to work out the amounts for various starting dates and the Council agreed to revisit the issue later in the meeting.
Mayor Foy suggested putting the high school interns back in the budget, and Council members supported that idea.
Council Member Ward expressed opposition to the Council receiving full time health benefits. "It is not fair. It is setting us up as special people…We are not full time employees," he said. Council Member Ward stated that to do this at the same time that they were struggling to give employees pay raises "smacks of self-interest." He described the proposal as appalling. "It galls the heck out of me, and I can't believe there's a majority of people that want to do this and can do it in good conscience," he said.
Council Member Greene stated that she could vote in favor of health benefits "in very good conscience," noting that Alamance and Chatham Counties give their Council members full time benefits. And Orange County provides retirement benefits, she said. Council Member Greene argued that it was not correct to describe it as a full time benefit for a half time job. "This is a job that requires enough of our time that it prohibits most of us from having a full time job," she said. Council Member Greene pointed out that the Town Council did not include people from the lower economic ranges. Making health insurance available was a good policy decision, she said.
"We could talk about this all day," said Mayor Foy, and he suggested moving the discussion along.
Mayor pro tem Wiggins said that the argument that offering health insurance would increase diversity among people who run for the Town Council was a "red herring." One way to increase diversity would be to have people come up through the boards and commissions, she said. But Mayor pro tem Wiggins stated that a recent African American applicant for the Transportation Board had received only one vote even though he was as qualified as any other applicant. Also, having to do 10-15 questionnaires and forums during the campaign process is a deterrent to many, she said. Mayor pro tem Wiggins predicted that the Council would not become more diversified as a result of providing health insurance alone.
Council Member Kleinschmidt stated that he believed in the benefit even though he did not intend to take it. He had associates whose backgrounds were similar to his, he said, and losing benefits if they were to run for Council creates an obstacle for them. Council Member Kleinschmidt mentioned an African American resident of Northside who had come up through the Planning Board. This benefit will make ultimate Council service a possibility for that individual, he pointed out. Council Member Kleinschmidt stated that he thought there was validity to the argument that Council Member Greene and others had made.
With regard to the Operating Costs section, Council Member Harrison inquired about the repercussions of not having budgeted for an aggregate increase. Mr. Horton replied that it would mean that, in cases where supply of materials might have gone up 5%, the Town had found a way to cover it as a part of the 2.1% allowance and would have to find a way to make do with fewer supplies. They would work with departments to realign their line item budgets, Mr. Horton said.
Council Member Strom asked if aerial photography must be done annually. Engineering Director George Small explained that there had been errors in the topography report. It was important to get that corrected given the stormwater utility, he said. Mr. Small explained that the company that had done that work had gone out of business. Council Member Strom verified that this would be a $42,500 contract.
Council Member Verkerk asked the Council to put the $48,000 for biodiesel fuel back into the budget. Council Member Ward expressed support for that idea.
Mayor pro tem Wiggins ascertained from Mr. Horton that the Town uses kerosene for the transit system and biodiesel fuel in places where the Town has diesel engines. She verified that these were the vehicles to which Council Member Verkerk was referring.
The Council voted unanimously to put the $48,000 back in the budget for diesel fuel.
Council Member Verkerk asked if there was money in the budget for a master transportation plan. Mr. Horton replied that the staff had been charged with finding grant funds to carry out that goal. But the staff had not yet had time to figure out how much it would cost to establish a transit master plan, he said. Mr. Horton estimated that the cost would be at least $100,000.
Council Member Strom said that UNC was very interested in participating in a transit master plan with the Town and that they might be willing to pay half the cost. He described that as a significant step and the direction in which the Town should be heading. Council Member Strom suggested that the Council put some money aside for pursuing a transit symposium.
Mayor Foy agreed that there was a great deal of support for that and that it was a Council goal. But there is no money for it, he said, and he suggested revisiting the idea later in the discussion. Council Member Strom agreed.
With regard to the employee pay plan, Mr. Horton noted that the net impact of moving it a month earlier and reducing it from 4% to 3.78% would be $55,000.
Council Member Ward asked what the additional savings would be if the start date were November 1, 2004. Ms. Johnson agreed to work that out. Mayor Foy commented that the net impact on the revised recommended budget would be an additional $25,000.
Mr. Horton remarked that the additional savings with the November 1st start date would be a few thousand dollars. It would not make any difference on the tax rate, he said. Mayor Foy, noting that the Council must make a decision on the personnel issue, asked if 3.78% was acceptable.
Council Member Ward said that he could support 3.78% with the November 1, 2004 date.
Council Member Greene commented that the Manager had just said the date would not make much difference.
Mayor Foy recommended coming back to this issue after finding out what that amount would be. Council Member Hill said that it would be $4,075. Ms. Johnson agreed that the effect of one month regardless of whether it is 3.78% or 4% would be very little money. Mayor Foy stated that he understood what Council Member Ward was saying but argued that it would be disruptive to use the November date if there were no real benefit to the Town.
The Council voted unanimously to increase employee pay by 3.78% effective October 1, 2004.
With regard to Operating Costs, Council Member Ward asked how the Town would achieve the $151,000 reduction. Ms. Johnson replied that they had reduced the reserve, eliminated the Town's contribution to the reserve, and taken an amount out of the current reserve. She explained that the staff had also reduced the number of vehicles they plan to purchase in the next year.
With regard to the Town Hall generator, Mayor pro tem Wiggins asked the Manager and Ms. Eastwood to address how employees could stay home from work when Town Hall is 40 degrees and not use vacation time. Mr. Horton explained that the Town could proceed with a generator that would be a diesel engine rather than natural gas fired. This would allow a reduction in some of the public works improvements associated with it and would result in a somewhat reduced cost, he said.
Mr. Horton pointed out that the Town also needed to make arrangements to serve its computer systems during power failures. It might be possible to do that with the funds they have this year, he said. By adding just a little more funding they could arrange for a rental generator to continuously operate a portion of the first floor, Mr. Horton explained. He said the staff believed that this could generate enough power for a small skeleton workforce to operate in a comfortable condition. They would then adopt a policy of asking other employees to work in other buildings that had power, Mr. Horton said. He pointed out that all of the fire stations would be available for that purpose, as would the police station if they get a generator.
Mayor Foy determined that a generator would cost $21,000 next year, a little less than $50,000 the following year, and then there would be a declining balance for a total of ten years.
Mayor pro tem Wiggins asked if that meant office employees would always be working in environments where their health, safety and welfare would not be in jeopardy. Mr. Horton replied that he could imagine an extreme emergency in which the Town might ask for volunteers to work in adverse conditions. But they would not order people to do so, he said.
Mayor pro tem Wiggins asked how the Council could examine specifics, such as employees not having to use vacation time when their buildings are not heated. Mr. Horton offered to bring back more information before the Council adopts a budget on June 14, 2004.
Mayor Foy proposed that the Council appropriate the $21,000 but refer the item to the Sustainability, Environment and Energy (SEE) Committee for further discussion. He recommended that the Manager to come back to the Council, but that they not hold the budget up over $21,000. Mr. Horton agreed that this was an excellent way to proceed. It would give the staff more time to figure out the best way to move forward, he said.
In response to a question from Council Member Kleinschmidt, Mr. Horton explained that the $21,000 would combine with $30,000 for paying the engineering costs incurred for Town Hall and the Police Department. So a generator system for all of Town Hall would cost $51,000 in the first year, he said.
Mr. Heflin explained that $23,000 had already been appropriated this year toward the Police Department's generator. They were asking for $19,000 more, which will make up the $42,000 first payment toward a five-year installment purchase for the Police generator, he said.
Council Member Kleinschmidt noted that the amount had originally been only $5,000. Mr. Heflin replied that $5,000 had been for a ten-year period. But they had shortened that to five years because the borrowing costs were significantly less, he said. Mr. Horton explained that these figures were complicated by the financing arrangements. The total cost is smaller for the Police generator system, so five-year borrowing makes sense there, he said. But the number is larger for the Town Hall system and a longer financing period makes sense.
Council Member Kleinschmidt commented that this gets the Town back to where it was with the original recommended CIP budget. Mr. Horton agreed that this is what the proposal on the floor would do. He noted, though, that he had recommended cutting the money for the Town Hall generator, leaving money for the Police Department generator, and fixing the Town Hall building so they could have a rental generator brought in if needed. Council Member Kleinschmidt stated that he strongly shared Mayor pro tem Wiggins's concern about people losing vacation days and would like the Manager to take that as a work item.
Mayor Foy noted that his suggestion to put money in the budget so that they could proceed with the generator meant that they would proceed.
Council Member Strom stated that the cost of generators would be $525,000. And the Council had not had a policy discussion about what the generators should accomplish, he pointed out. Council Member Strom agreed with Council Member Kleinschmidt that it would take much more analysis to understand the overall costs. He agreed with the proposal to hold off and send it to the SEE Committee for discussion.
Council Member Hill agreed, stating that generator needs were obvious in the Police Department. Maybe the Town Hall staff should just stay home when outages happen, he said.
Council Member Ward agreed that Council members should hold back on this expenditure until they have a more comprehensive understanding of ways to solve those needs. He expressed support for renting a generator for computers, telephones and a small service area. Mr. Horton pointed out that many people, such as inspectors, must come to work during adverse conditions even though they might not be in the building. He also noted that the Town must continue to pay bills, issue paychecks, and handle emergency service management during storms.
Mayor Foy said that the Council seemed to want to leave this out of the budget this year. He suggested referring it to the SEE Committee and having a review of the personnel policy regarding Mayor pro tem Wiggins's concerns.
Council Member Ward asked what the Town would not get as a result of cuts in small park improvements, paved bike path trails, and Homestead Park. Mr. Heflin replied that virtually all Town park parking lots were in need for repair. Walkways and sidewalks were deteriorating, and parking areas and buildings need repair as well, he explained. Council Member Ward asked if the reductions meant that those things would not get done. Mr. Heflin replied that it meant the Town would not do as much. Projects had been prioritized in terms of need, he said, and the Town would attempt to repair the worst ones first. Council Member Ward encouraged the Council to reestablish the original funding levels for these items. The issues are safety-related and are in areas of the Town that citizens use every day, he said.
Mayor Foy verified that the cost was about $71,000.
Council Member Harrison asked if those numbers would be the same next year. Mr. Heflin replied that there were several hundred thousand dollars worth of need. The staff envisioned multi-year funding at this level, he said. Council Member Harrison commented that there was a "fair amount of citizen support for this kind of expenditure."
Council Member Kleinschmidt asked why the projected costs would dip next year. Mr. Heflin described those as "balancing numbers" to reach an overall financial target. But they might change again before next year since some expenses from this year will have to be deferred, he said. Council Member Kleinschmidt wondered, since there will always be the need for these items, about knocking it down a little bit this year.
Council Member Ward replied that doing so would mean ending up with deteriorating parks.
Mayor Foy said, in summary, that Council Member Ward was proposing adding $71,000 back into the budget. This includes $25,000 for small park improvements, $25,000 for capital repairs for bike path repairs, and $21,000 for Homestead Park, he said.
Council members voted (6-3) to put that amount back in the budget, with Council Members Strom, Greene and Hill voted Nay.
With regard to Special Programs and Service Contracts, Mayor Foy mentioned that several Council members had talked with him about supporting the Public Art Program at a level higher than $70,000. He suggested discussing the possibility of eliminating commercial refuse collection. That potential savings would have an impact on his thinking about the rest of the budget, he said. Mayor Foy noted that doing so would save about $200,000 annually. He pointed out that the Council discusses this every year and had debated it in the past.
Mr. Horton proposed that the County Commissioners see the Inter-local Agreement that the Council had entered into as a commitment to continue operating in much the same manner as it had in the past. Orange County might see the Town getting out of that business altogether as a reduction in waste coming to the Orange County Landfill, he said, noting that this would cost the County revenue. Mr. Horton also commented that a July stop date would not be practical in terms of giving notice to those who are depending on the service. October would be a better time, he said.
Council Member Kleinschmidt asked if the Town would realize the same amount of savings if it charged for commercial pickup. Carrboro does that, he said, adding that Orange County had not objected to it. Acting Public Works Director Bill Terry offered to figure out how much rate increase the Town could entertain without pricing itself out of the business. Council Member Kleinschmidt reported that Carrboro had initially lost some business. But dissatisfaction with private haulers had caused many of them to come back, he said. Mr. Horton verified that $200,000 was a safe estimate of the annual cost savings.
Council Member Strom suggested that the Council give direction to the staff and put a figure in the budget as a placeholder. He recommended endorsing a change in the non-residential pickup scheme and bringing back a final plan. He wanted to know how the Council stood on this before making decisions on some of the other budget items. Mayor Foy expressed support for the idea, but contingent upon the Town not instituting changes before October, or even January, of 2005, and that no employee positions would be eliminated. Mr. Terry pointed out that the greatest savings comes from eliminating jobs. But this could be done through attrition, he said, noting that collection positions were graded similarly to transit and truck drivers.
Council Member Harrison asked Mr. Horton if he had not recommended this because of the Interlocal agreement. Mr. Horton replied that this was the reason, but noted that it was a policy choice for the Council to make. Council Member Harrison asked about the County Manager's opinion. Mr. Horton replied that it would be fair to say that Orange County Manager John Link believes that such a move would be contrary to the intent and spirit of the Interlocal agreement.
Council Member Strom pointed out that attrition had been the approach the Town had taken when going from backyard collection to curbside.
Council Member Greene asked about the history behind the Interlocal agreement and what would be compromised if the Town made this change. Mr. Horton replied that the language refers to the parties as "committed partners" and describes the intent to continue bringing material to the Orange County Landfill. The presumption at the time was that all parties would continue to collect material as they had been, he said. Council Member Greene verified that a commercial hauler could not be obligated to take trash to the Orange County Landfill unless the Town had a contract with the hauler.
Mayor pro tem Wiggins ascertained that Orange County could increase tipping fees to make up for budget shortfalls. She asked what else they were likely to do, and Mr. Horton replied that they could establish other types of fees to recover their cost of operation. Mayor pro tem Wiggins noted that the County had not consulted with the Town before instituting a $75 recycling fee. She wondered if there was any point in discussing the issue with them. Mr. Horton replied that he "absolutely agreed that it would be worth having that discussion." Mayor pro tem Wiggins pointed out that the Council might not be saving taxpayers any money because they might just have to pay it in another form.
Mr. Horton stated that the key question was how much solid waste would be diverted from the Orange County Landfill to some other landfill. And it was not possible to know that, he pointed out.
Mayor Foy commented that the County needs a certain amount of revenue to run the landfill. But the landfill will be closed permanently one day, he said, adding that there is never an accounting for it staying open longer and the benefit that would bring to the portion of the community that uses it. Mr. Horton commented that there still would be a disposal facility there. But it will be a transfer station rather than a landfill, he said.
Council Member Kleinschmidt recommended putting a placeholder in the budget and then either recovering the cost of commercial trash pickup by charging the full amount, or eliminating the service.
Mayor Foy asked Mr. Horton if it would be safe to say that the Town would save $100,000 by making either of those changes on January 1, 2005. Mr. Horton had just asked Mr. Terry to determine how much the fees would have to change to save $100,000, he said.
Council Member Strom suggested giving a quarterly notice and putting more than $100,000 in as a placeholder.
Council Member Ward expressed opposition to discontinuing the service at this time. Mayor Foy replied that making this change would not mean discontinuing the service. It would mean raising the amount so there would be no subsidy, he said. Council Member Ward asked where the material would go. Mayor Foy replied that it goes to private landfills and that the Town cannot collect that data.
Mr. Horton stated that the fee would have to be 40%-50% higher to recover $100,000. He predicted that the Town would lose a substantial amount of customers.
Mayor Foy verified that the fee was currently $550 per year, per dumpster, for service once a week. This was about $50 a month, he said, so it would increase to $60 to $70 a month. Mr. Horton offered to calculate that including a deterioration in the number of customers, noting that there would be a slight, calculated risk. Mayor Foy suggested putting in a placeholder for $100,000, and the Council unanimously agreed.
Mayor Foy recommended that the Town fund the Interfaith Council's (IFC) request for $30,000. It was not in the budget, he said, but explained that he had become convinced of the need for it this year. Mayor Foy said that he'd had several conversations with the president of the IFC and had told them that it should not be an ongoing appropriation. But he did not want to see the consequences of further disruption in the IFC, Mayor Foy said. Council members unanimously voted to support the IFC's request for $30,000.
Mayor pro tem Wiggins asked to add $14,400 to make the Special Olympics staff person's position full time.
Council Member Strom expressed concern about there being no money coming into the program from Orange County or Carrboro. He also commented that the position seemed to be "leap-froging over all other positions that the Council had eliminated in order to save money." Council Member Strom stated that he had been moved by the testimony of those who had to spoken on behalf of this position. But there should be a more orderly process, he said, and he suggested asking the Parks and Recreation Department to fund the position by raising money internally.
Mayor Foy agreed that the proper procedure was for this to come up through the budget process and be recommended by the Manager. Approving this position would encourage others to come outside the budget process and would leave the Council open to future difficulties, he pointed out. Mayor Foy noted that the Council had not funded another position last year because it had come to them in this way and they had wanted to maintain the integrity of the process.
Council Member Harrison noted that some of the people who had advocated for the full-time position had thought the Council was the Orange County Board, calling it “the Orange County mayor and town council.” There seemed to be a missing player at the funding table, he remarked, and expressed hope that there would be a more explicit participation from Orange County in a program that has its name on it.
Council Member Ward asked how the Council could advocate for the full time position to Orange County and Carrboro. Mr. Horton recommended that Mayor Foy call the Chair of the County Commission and ask for $10,000 and call the Mayor of Carrboro and ask for $4,000.
Council members agreed by consensus to ask Mayor Foy to do that.
Council Member Greene agreed that the proposal had not come through the process the right way. It would set a precedent for the Town picking up the whole tab for a service that is provided to the entire county, she said. Council Member Greene suggested that those who had come before the Council also go before the County Commissioners and the Carrboro Board of Aldermen.
Mayor pro tem Wiggins said she hoped Mayor Foy would be successful in getting the $14,400. The Special Olympics is an excellent program that needs to be supported at a full time level, she said. However, Mayor pro tem Wiggins said, she objected to comments about it being outside the process, since there were other items that the Council was planning to add to the Manager's recommendations.
Council Member Greene noted that the Council had talked about reallocating some things from the Hotel/Motel Tax.
Mayor Foy pointed out that human service agencies had been itemized on page XIV of the budget. Council Member Greene verified that this is where the $30,000 to the IFC would be added. She suggested moving $10,000 from the Visitors Bureau to the ArtsCenter.
Council members unanimously agreed.
Council Member Greene argued that $70,000 was too little for the Arts Commission, which had requested twice that amount.
Mayor Foy agreed and urged Council members to settle on an amount.
Council Member Verkerk proposed starting at $100,000 and "bidding up." Council Member Strom proposed $125,000, noting that the Commission had asked for $148,000. Some of that would come from the General Fund, he said, but he argued that it would be appropriate to take $10,000 from the Orange County Visitors Bureau.
Mayor Foy verified that there still would be a need to take $45,000 from the General Fund, and Council members agreed to do so.
Mayor Foy said that he had calculated an increase of $122,000 from the Manager's revised recommended budget. This included $25,000 for the pay plan, $3,000 for interns, $48,000 for biodiesel fuel, $71,000 for small parks, $45,000 for the Arts Commission, and $30,000 for the IFC, he said. Mayor Foy noted that this included subtracting $100,000 for pickup of commercial refuse.
Council Member Strom commented that the $14,500 for the Special Olympics was not included because the Council had decided to ask Parks and Recreation to fund it internally. Mr. Horton replied that it was not feasible for the Parks and Recreation Department to do that because their budget had been cut back as far as possible. Council Member Strom said that the funding would, therefore, have to come from Orange County and Carrboro.
Mayor Foy stated that the proposed additions to the budget totaled $150,000. He suggested putting at least $50,000 to $70,000 in a Council contingency fund for the transit master plan.
Council Member Strom agreed that this was the minimum amount needed. Mayor Foy suggested putting $75,000 into that fund, which would bring total additions to $225,000. This would be a 1/2-cent on the tax rate, bringing the tax rate increase to 2.3 cents, he said. Mr. Horton stated that the Finance Director had calculated the total increase to be $200,000 rather than $225,000.
Council Member Ward asked the Council to begin addressing problems at park restrooms by winterizing the one at Homestead Park, at a cost of $71,000.
Council Member Strom stated that he could not spend that much money to winterize bathrooms because one could frame and build an affordable house for that amount. He agreed that there was a need, "but not at that price." There must be another approach, said Council Member Strom.
Council Member Hill explained that the restrooms needed to be taken down and rebuilt. He agreed that it needed to be approached more thoughtfully, though, and perhaps made part of a bigger upgrade.
Council Member Ward said that he too had been astounded by the figures. But the cost had been similar at the UNC golf facilities and NC State Arboretum, he said. Council Member Ward stated that he would support a cheaper way of doing it if one existed. Mr. Terry explained that all of the facilities had been built with thin walls, louvers and open spaces. Trying to retrofit those now would be very complicated, he said, so the staff had decided to start with the oldest ones first and just tear them down.
Council Member Harrison noted that the skate park at Homestead Park had a winterized bathroom. He asked if it would be possible to reorganize the entry system and make it available to the rest of the park. Parks and Recreation Director Kathryn Spatz replied that the area would have to be supervised when the skateboard park was not open.
Council Member Hill wondered about putting portable toilets at the parks. This would be relatively inexpensive, he said, adding that winterizing the restrooms could become part of a capital improvement approach to the parks.
Council Member Ward expressed a willingness to go along with that. Ms. Spatz said that they had used port-a-johns in the past and that funding had come out of their operating budget. Council Member Ward asked how much it would cost to provide portable toilets more broadly. Mr. Horton offered to bring that information back on June 14, 2004.
Mayor Foy stated that the Council had added $200,000 to the Manger's recommended budget. This would be 2.25 cents on the tax rate, he said. Ms. Johnson commented that the amount would be slightly higher because they would need to include pay adjustments on the Transportation side as well.
The meeting adjourned at 6:38 p.m.