HomeMy WebLinkAboutResolutions - 2014.04.17 - 21258MISCELLANEOUS RESOLUTION #14071 April 17, 2014
BY: FINANCE COMMITTEE, THOMAS MIDDLETON, CHAIRPERSON
IN RE: ESTABLISHMENT OF OAKLAND COUNTY 9-1-1 CHARGE RATE (FORMERLY TELEPHONE
OPERATING SURCHARGE) FOR THE PERIOD JULY 1,2014 TO JUNE 30, 2015
TO THE OAKLAND COUNTY BOARD OF COMMISSIONERS
Chairperson, Ladies and Gentlemen:
WHEREAS the County has created and operated an interoperable public safety radio
communications system for over a decade for the benefit of local law enforcement, fire, emergency
medical services, hospitals, homeland security and other operating purposes; and
WHEREAS the County constructed this public safety radio communications system through a 9-
1-i charge (fee) on devices, as defined by the Emergency 9-1-1 Service Enabling Act, Michigan Public
Act 32 of 1986, MCL §484.1101 et seq., as amended; and
WHEREAS the Michigan statutes requires that county boards of commissioners annually approve
the 9-1-1 charge rate for the fiscal year period from July 1 through June 30 each year (including the
period under consideration in Oakland County of July 1, 2014 through June 30, 2015); and
WHEREAS the State requires that a certified copy of the board of commissioners resolution be
submitted to the Michigan Public Services Commission no later than mid-May of each year covering the
ensuing July 1 through June 30 fiscal year; and
WHEREAS the County's 9-1-1 charge rate is $.20 per month per device as defined by Michigan
statutes and is well below the authorized limit established by State statute; and
WHEREAS an attached Memorandum dated March 25, 2014 from the County Administration
covering the financial, programmatic, and capital status and needs of the Radio Communications Fund for
the funding period July 1,2014 through June 30, 2015 has been prepared; and
WHEREAS the attached memorandum has recommended a continuation of the 9-1-1 charge rate
of $.20 per month per device as defined by Michigan statutes; and
WHEREAS the operating budgets adopted by the Board of Commissioners in September 2013
for the FY-2014, FY-2015 and FY-2016 operating periods contemplated the use of a 9-1-1 charge rate of
$.20 per month per device as defined by Michigan statutes.
NOW THEREFORE BE IT RESOLVED that the County's Board of Commissioners hereby
approves the 9-1-1 charge of $.20 per month per device as defined by Michigan statutes for the period
July 1, 2014 through June 30, 2015.
Chairperson, on behalf of the Finance Committee, I move the adoption of the foregoing
resolution.
FINANCE COMMITTEE
FINANCE COMMITTEE VOTE:
Motion carried unanimously on a roll call vote.
OAKLAND
L. BROOKS PATTERSON, OAKLAND COUNTY EXECUTIVE
COUNTY MICHIGAN
Robert J. DaddoW
Special Projects Deputy County Executive
TO: Finance Committee'
Radio Oversight Committee
Mike McCabe
Phil Bertalini
Laurie VanPelt
Jamie Hess
Jeff Werner
Pat Coates
Holly Conforti
Shawn Phelps
rikk4 FROM: Bob Daddow 41-1 "
SUBJECT: Radio Project Status at December 31, 2013 and Proposal for 9-1-1 Charge
Charge (e.g. Telephone Operating Surcharge) Rates for July 1, 2014 to
June 30, 2015
DATE: March 25, 2014
The State statutes associated with the "9-1-1 charge" (e.g. telephone operating surcharge)
require that County Board of Commissioners approve the fee on an annual basis for each
fiscal year ending June 30 in this case, for the period from July 1,.2014 through June
30, 2015. The funding provides capital and operating support for The County's public
safety radio communications system operated on behalf of the County's Sheriffs Office,
local units of government's po.lice, fire and emergency medical services, hospitals and
other related. parties. The resolution approving the telephone operating surcharge by the
Board. must be .submitted to the State no later than May 15, 2014 in order that the
-surcharge can be placed on the.telephone .bills starting July 1, 2014.
Oakland County has a $.20 per wireline wireless device as defined charged to County
users for the period July 1, 2013 through June 30, 2014. In addition, the Radio
Communications Fund receives funding from a State distribution, toWer fees and other
miscellaneous revenues. The revenue source controlled locally is the 9-1-1 charge
approved annually by the Board of Commissioners in accordance with State statutes.
On-a quarterly basis ; the County administration issues a letter of transmittal covering the
quarterly operating results, financial statements and explanatory comments for the Radio
Communications Fund. No current, significant capital expenditures are being made, but
EXECUTIVE OFFICE BUILDING 41 WEST • 2100 PONTIAC LAKE RD DEPT 419 • WATERFORD MI 48328-0409 • (248) 858-1650 • FAX (248) 452-9215
EMAIL: daddowr@oakgov.com
several are contemplated in the near future as discussed herein. The report for the year
ended September 30, 2013 was previously submitted to the Finance Committee. The
financial statements for the Radio Communication Fund for the quarter ended December
31, 2013 are attached as Exhibit A.
This memorandum covers the financial status of the Radio Communications Fund and its
capital and operating needs for the next several years. Since the 9-1-1 charge (fee) is the
principal source of controllable revenue for the Fund, the sizing of the charge is critical
for the periods July 1, 2014 through June 30, 2015 and beyond.
RADIO COVERAGE PROJECTS
The County's radio communication system has been fully operational for many years
with the last public safety agencies being brought on-line in the fall of 2010. Since that
time, the County has enhanced the radio communication coverage by constructing or
acquiring lease space on a dozen tower sites. It is presently anticipated that no significant
funding will be required on completing the improvements necessary in the radio
communications coverage.
At present, the radio communication system has 51 towers (County owned, locally owned
by governmental units within the County or leased space from private vendors), 1,995
mobile radios and 4,163 portable radios in use. Radio consoles are located in 21 public
safety dispatch centers (PSAPs) throughout Oakland County. There are 13 hospital
emergency rooms tied to the County's radio communication system and a number of
private ambulance companies as well. Some non-public safety units use the County's
radio system for a monthly operating fee.
Radio Consoles
Because the County distributed the radio consoles located in the dispatch centers first
(circa 2003 through roughly 2006), this equipment is aging rapidly. Replacement is
planned for FY 2015 through FY 2016. While the County has yet to assemble an
estimated cost of the replacement of this equipment based upon a formal study, the cost
could approach $4 million to $6 million, depending upon the number of dispatch centers
remaining in Oakland County at the time of replacement. The original deployment of
consoles cost roughly $5.9 million for 31 dispatch centers. There are now 21 dispatch
centers. Presently, there are no active discussions in the consolidation of dispatch centers
in the County.
The difficulty in calculating the amounts needed to be set aside for a console replacement
program involves several factors:
• The State has been actively encouraging local units of government to consolidate
services. In doing so, just how many dispatch centers will need to be outfitted
with new consoles at the time of replacement cannot be determined. Prior,
unsuccessful attempts by the State Legislature have been made to force local units
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to combine dispatch functions. Given the uncertainty over how many dispatch
centers will require conversion to the new equipment, the County must assume
that all present centers will require conversion.
• Technology costs generally decline over time. The original consoles were
deployed from 2003 through 2006 — meaning they have been in use for 7 to 10
years. The equipment is expected to last another one to two years as the County
gears up for the conversion to the new equipment.
• Some of the original costs were likely one-time installation and start-up costs not
requiring replacement. The one-time costs would have included the County's
issues with a radio vendor involving installations and parts that failed, as well as
other matters. These costs would likely not recur in a future installation. There is
no way of assessing how much of the $5.9 million may have been related to these
one-time installation costs.
• The Sheriff's Office is reaching its facility capacity without moving the dispatch
operations to another site. While certainly a few smaller dispatch center
operations could be consolidated into the Sheriff's operations, any sizable
dispatch operations may be too large to consolidate absent a change of venue.
There is no current plan to secure additional space in the Sheriff's Office dispatch
to accommodate a larger dispatch center.
At December 31, 2013, the unreserved equity-designated for projects includes $3.0
million set aside to address the console replacement anticipated to be purchased and
installed in FY 2015 as well as additional reserves of $2.0 million to finish the
installations in FY-2016.
Mobile / Portable Radios
Last year, County administration was notified that the radio communications vendor will
no longer support the mobile and portable radios at the end of calendar 2017. The
County's radio communications system is the life-blood of public safety
communications. Having portable and mobile units not supported by the underlying
vendor could be problematic (of course, an assessment of this matter would have to be
made circa 2016 / 2017 to determine if the hardware truly needs replacement). However,
even as the radio communications vendor will no longer support the radios, the County
has assumed the operations and maintenance of the system and the radios will still have
practical, useful life beyond 2017.
While the County administration has been notified that the radios will be end-of-life at
the end of 2017, history would suggest that few governmental units (unlike the County)
set money aside for the replacement equipment. As such, as the end-of-life date closes
in, governments seek federal / state assistance and / or bring pressure on the vendor to
delay the actual end-of-life date. While the County cannot be assured of a delay in the
future, County's maintenance efforts, ability to use the equipment beyond 2017 and the
3
potential delay of the actual end-of-life date suggests that the actual replacement period
would be in 2018 to 2020.
At this time and assuming that a future assessment would require replacement, the
aggregate original cost of the mobile and portable radios as of December 31, 2013 was
$17.36 million. The County has restricted equity relating to depreciation in the amount
of $13.5 million as of December 31, 2013, but needs to continue to set aside additional
funds of $6.5 million over the next 4 to 5 years to ensure that there is sufficient available
resources to replace the mobile and portable radios beginning in FY 2018 through
anticipated completion in FY-2020.
Based on current cash flow projections it is estimated that the equity could be
underfunded by $2.5 million to $3.3 million in FY-2020. While the projected cash in FY-
2020 may be short, when adding the then accounts receivable and other liquid assets at
that time (principally the amounts receivable shortly after the quarter's end from the
telephone companies and State), the amount of cash and near-cash items in FY-2020
leaves a shortage of just under $1.0 million. Since the amount and time frame are so far
off and there are actions that can be taken to resolve this matter in the interim (depending
upon events that cannot presently be predicted), the difference is not considered to be
presently significant.
Because the County has been informed that the portable and mobile radios will be at the
end-of-life at the end of calendar 2017, the depreciation schedules were adjusted to
reflect that all of this equipment would be fully depreciated no later than December 31,
2017. Purchases of future portable and mobile radios currently in use will be measured
against the knowledge that they may have to be replaced in roughly 5 years; such efforts
should result is some capital savings over the next several years.
Computer-Aided Dispatch Project
The County's computer-aided dispatch center equipment software for CLEMIS is being
re-written as the vendor-acquired software is no longer easily maintained and the
software licensing to maintain this equipment is very costly. The County has recently
started this project. The estimated cost of this project is $3.5 million and will be funded
out of the Radio Communications Fund with $2,540,654 remaining to be expended in
unrestricted equity-designated for projects. Presently, the amount set aside is considered
adequate to complete the project. The launch of the first pilot dispatch center is expected
in April 2014.
NG-911 Project Needs
In 2009-2010, the County acquired new call-taking equipment (NG-911 Project) on
behalf of the local public safety dispatch centers. Unlike older telephony-based call-
taking equipment, NG-911 systems are IF-based software-driven systems and can be
expected to have a shorter useful life that earlier systems before requiring a technology
refresh. It is therefore anticipated that the call-taking equipment at the 21 local PSAPs
4
will need to be replaced in the 2016-2018 timeframe. Additionally, the County needs to
prepare for the establishment of a local NG-911 ES1net (Emergency Services IP network)
through either a leased commercial network or the enhancement/expansion of the present
OakNET fiber, as the present 911 network provider gradually migrates away from the
legacy copper-wire trunks.
Radio Communications and Information Technology staff will begin a needs analysis in
2014 toward the development of a request for proposal for call-taking equipment and an
NG-911 ESInet so that costs can be quantified in 2015. Presently, the Fund has set no
amounts aside for these capital needs.
SUMMARY OF EQUITY AND PROJECTS' RESERVES
The ending equity has been classified as 'unrestricted' in Exhibit A as of December 31,
2013. The components of the Radio Communications Fund equity follow:
• Funding of depreciation: $13,548,583 has been set aside currently in equity to be
used towards future capital projects. The amount is short by between $2.5 million
to $3.3 million for the future capital needs through FY-2020 depending upon
events affecting the Fund (consolidation of dispatch centers for example) between
now and then. The difference will need to be accumulated over the next half
dozen years to meet future capital needs.
• PSAP software implementation: $3,500,000, less costs incurred of $959,346 for a
net remaining amount of $2,540,654,
• Console replacement - $3,000,000 for equipment replacement beginning in FY
2015. Anticipating setting aside an additional $2,000,000 for this need until the
amount reaches $5.0 million (or a better estimate is obtained).
• Total equity for the Radio Communications Fund is $19,236,475 ($19,089,237 in
designated for projects with the remaining amount in unrestricted equity).
REVENUE / OPERATING ANALYSIS
The County operations are largely funded from two sources: 9-1-1 charges (e.g. fees and
formerly called 'telephone operating surcharge') imposed on County residents and
businesses at $.20 per communication device per month, as defined. In addition, there is
a companion State-wide fee charged to all State residents and allocated back to the
counties on a set funding formula. Only the County-imposed 9-1-1 charges (fees) can be
adjusted by the Board of Commissioners for the fiscal year ended June 30, 2015.
The annual amount of the surcharge revenue for the year ended September 30, 2013 was
$5,968,139 of which $5,315,072 applied to the State and County 9-1-1 charges (fees).
The two components are: State 9-1-1 charges (fees) of $1,842,471 and County 9-1-1
5
charges (fees) of $3,472,601. At $.20 per device, the calculated annual dollar benefit of a
penny on the fees is $173,630 (rounded = $175,000).
The quarter ended December 31, 2013 reflected surcharge revenues of $1,340,018 against
an operating budget for the quarter of $1,375,000 - for an unfavorable variance of
$34,982. The unfavorable variance may be attributable to changes in state statute
regarding the method in which prepaid surcharge is collected and remitted. The State had
not previously been aggressive in following up on stores selling prepaid telephone cards
but not remitting the collected fees to the State. Recently, the State has taken action to
improve these collections.
Over the last several years, the County's radio shop relied heavily (and to a lesser extent
in recent years) on outside consultants to assist in maintaining the County's radio
equipment. During the past several years, the County invested heavily in County-
employee training such that the reliance on outside consultants and repair shops could be
avoided. In late FY-2012, the radio shop now is responsible for maintenance; such
reliance on in-house efforts should help in controlling this operating cost. In addition, it
will assist the County in extending the useful life of the present equipment if necessary
later on in the decade.
The County's Radio Communications Fund has financially assisted local units when
dispatch centers were consolidated. The assistance involves the acquisition of equipment
and software, technical consulting support, networking, movement of equipment and
similar costs eligible under State statutes to be charged against the operating surcharge
revenues. The County's return on this consolidation, which would be significant if more
dispatch centers would consolidate, will be to avoid future equipment replacement costs
that are presently anticipated in the above projected capital needs. In addition, it would
reduce overall maintenance cost through fewer dispatch locations. At present, there are
no known consolidations under consideration. The County will continue to financially
assist the local units when a dispatch center consolidates.
In December 2012, the State imposed new minimum qualifications on dispatch personnel
that may be difficult for the smaller dispatch centers to honor, particularly when
temporary duty police officers are used as dispatchers. While there would be no
immediate need to consolidate as the local units grapple with these new standards, it is
highly likely that the smaller dispatch centers, facing sanctions from the State, may
choose to consolidate dispatch centers with surrounding communities or the Sheriffs
Office.
The FY-2013 operating statements indicated an operating loss is being incurred for the
FY-2013 of $4.3 million; however, much of this loss was created by the non-cash
depreciation expense of $5.5 million (essentially the difference between these two
amounts would largely be related to the funding of depreciation set aside in a reserve
within equity as noted above). The depreciation expenses are non-cash transactions
based on the capital costs of equipment acquired in prior years. No outstanding debt has
6
been issued against these assets. Essentially, the funding of a portion of the deprecation
should assist in future capital needs of the Radio Communications Fund.
The quarter ended December 31, 2013 had an operating loss of $1,072,000; however,
depreciation charged for the quarter was $1,478,000. The amount of positive cash flow
arising from the funding of depreciation (estimated at $406,000 for the quarter -
$1,478,000 less $1,072,000) is being adversely affected by the unfavorable variance of
the surcharge funds cited previously. The 'positive' cash flow may have declined but it is
still providing resources to be set aside for future capital needs.
OPERATING SURCHARGE FOR JULY 1, 2014 TO JUNE 30, 2015
The County's previous Fiscal Plans (e.g. Framework) cited that a 20% equity level would
be needed in most funds. While a decent benchmark for most County funds, it does not
work well for the Radio Communications Fund given the sizable and periodic capital
needs. Both the operating needs (primary) and the more flexible (as to timing) capital
needs must be considered.
For example, in approximately 18 months the County will be required to replace radio
consoles at a cost of between $4.0 million and $6.0 million ($5.0 million has been used
for this memorandum pending a formal bid request being issued). The County is
currently setting aside reserved equity arising from the funding of the depreciation up
until that time so that the equipment can be replaced. Once the consoles are replaced, the
equity will fall precipitously and the funding of the depreciation on the new equipment
will commence. Equity positions will be impacted even more so with the replacement of
the mobile and portable radios circa 2017.
On-going operations and maintenance costs relating to this Fund are relatively fixed (e.g.
should not vary from year to year). Other than the capital needs as discussed in this
memorandum, no amounts need to be set aside that cannot be addressed out of the
operations and maintenance component of the Fund. As such and because of the
substantial periodic capital needs in the coming years, the 20% equity target is not
germane for this Fund. Rather the adequacy of cash and near cash liquid items should
drive the operations and setting of the 9-1-1 charge (fee) rate.
The operating budgets for the Radio Communications Fund are based on the $.20 per
device per month, as defined, as the principal revenue source for the FY-2014 through
FY-2016 budgets adopted by the Board of Commissioners. The operating budgets reflect
a 'planned use of equity' annually of $3.5 million for FY 2014, $3.2 million for FY 2015,
and $2.9 million for FY 2016. The actual operations for first quarter of FY-2014 are
slightly unfavorable than the adopted budget including the unfavorable variance of the
surcharge as noted previously.
Projecting the quarterly operating loss out for the rest of the year on a straight-line basis,
the operating loss would be $4.29 million. The difference between the FY-2014
depreciation charged to operations and the operating loss would generate a positive cash
7
flow of approximately $1.62 million; such amount is considered adequate for the
proposed 9-1-1 Charge (e.g. Telephone Operating Surcharge) Rate for July 1, 2014 to
June 30, 2015.
SUMMARY
Given the above financial assumptions and the financial status of the Radio
Communications Fund as of December 31, 2013, the 9-14 charge (fee) rate of $.20 is
adequate to address operating and capital needs over the period July 1, 2014 through June
30, 2015. In addition, the $.20 rate should be used for the revenue base of the Radio
Communications Fund for the FY-2014 through FY-2017 operating budgets based on
current projections (such projections would be analyzed annually in connection with the
Board's responsibility for setting the 9-1-1 charges rate each spring).
Given the uncertainties of the number of dispatch centers that will continue to operate
(and thereby require equipment replacement in the coming years), it is difficult to
determine if the $.20 9-1-1 charge (fee) would be adequate to cover all capital needs
through FY-2020 (assuming no consolidation efforts over the next 6 years — which seems
unlikely),
Given the that the State statutes require the County administration and Board of
Commissioners to review the adequacy of the 9-1-1 charge (fee) annually and the capital
program covers an extended period, should there be a necessity for a rate increase in the
future there is adequate time to raises the rates to meet the capital needs.
8
EXHIBIT A County of Oakland
Radio Communications Fund
Statement of Net Assets
December 31, 2013
ASSETS
Current assets:
Cash and cash equivalents
Accrued interest on investment
Due from other governments
Accounts receivable
Inventories
Prepaid Items
Total current assets
Noncurrent assets:
Capital Projects in Progress
Tower rights
Equipment
Structures
Less accumulated depreciation
Total capital assets (net of accumulated depreciation)
Total assets
LIABILITIES
Current liabilities:
Vouchers payable
Accounts payable
Due to municipalities
Total current liabilities
Total liabilities
NET ASSETS
Invested in capital assets, net of related debt
Unrestricted-designated for projects
Unrestricted
Total net assets
$ 17,048,680.95
87,213.84
24,641.92
1,765,691.67
551,301.30
153,431.92
19,630,961.60
85,735.98
8,585,770.20
26,404,230.18
12,833,781.50
(16,886,308.64)
31,023,209.22
50,654,170.82
143,815.16
105,596.96
145,074.70
394,486.82
394,486.82
31,023,209.22
19,089,236.78
147,238.00
$ 50,259,684.00
County of Oakland
Radio Communications Fund
Statement of Revenues, Expenses, and Changes in Net Assets
For the Three Months Ended December 31, 2013
EXHIBIT A-.1
2014
Year to Date
Favorable
Amended Percent of
Budget Revenue Allotment
Percent of (Unfavorable)
Actual Revenue Variance
Operating revenues:
E-911 surcharge - Radio system
Antenna site management
Leased equipment
Parts and accessories
Outside agencies
Productive labor
Miscellaneous
Adjustment prior years revenue
Total operating revenue
$ 5,500,000.00
325,000.00
230,000.00
150,000.00
70,000.00
6,003,00
6,281,000,00
87.57% $ 1,375,000.00 $ 1,340,017.64
5.17% 81,260.00 72,400.00
3.66% 67,500,00 54,799.20
2.39% 37,500.00 71,481.56
1,11% 17,500.00 16,148.04
0.10% 1,500.00 2,013.00
0.00% 6.76
0,00% 10,593.75
100.00% 1,574,250,00 1,567,459.95
85.49% $
4,62%
3.50%
4,55%
1.03%
0.13%
0.00%
0.68%
100.00%
(34,982.36)
(8,860.04)
(2,700.80)
33,981.56
(1,351.96)
513.00
8.76
10,593.75
(2,790.05)
Operating expenses:
Salaries 634,088.00 10.10% 158,522.00
136,325.26 8.70% 22,196.75
Fringe beneflts 390,868.00 6,22% 97,717.00 90,917.78 5.80% 6,799.22
3.58%
0.00%
1.69%
4.78%
0.14%
3,12%
0.01%
4.38%
0.02%
0.06%
0.01%
19.11%
0.01%
0,0/%
0,00%
0.64%
6.21%
0,36%
4.00%
44.01%
Contractual services:
Communications
Contracted services
Electrical service
Equipment maintenance
Freight and express
Indirect costs
Laundry and cleaning
Maintenance contract
Membership, dues
Personal mileage
Printing
Professional services
Rebillable services
Software rental lease purchase
Software support maintenance
Special projects
Tower charges
Travel and conference
Workshops and meetings
Total contractual services
225,000,00
-
100,000.00
300,000,00
8,500.00
196,000.00
700.00
275,000.00
1,000.00
3,500.04
500.00
1,200,000.00
500,00
700.00
40,000.00
390,000.00
22,500.00
100.00
2.764,000.00
56,250.04
25,000.00
75,000.00
2,125,00
49,000.00
175.00
68,750.00
250.00
875.00
125.00
300,000.00
125,00
175.00
10000.00
97,500,00
5,025.00
25,00
691,000,00
107,742.22 0.87%
900.00 0.06%
18,448.61 1.18%
126,953.19 8.10%
041,57 0,04%
43,317,75 2.76%
107.76 0.01%
0.00%
0.00%
1,263,71 0.08%
0.00%
112,298.13 7.16%
0.00%
11,676.00 0.74%
58,847.76 3.75%
0.00%
97,420.27 6,22%
0.00%
0,00%
579,610.97 36,98%
(51,492,22)
(900.00)
8,551.39
(51,953.19)
1,483.43
5,602.25
67.24
68,750.00
250.00
(388,71)
125.00
187,701.87
126.00
(11,601.00)
(58,847,76)
10,000.00
79.73
5,625.00
25,00
111,383.03
Commodities:
Dry goods and clothing
Expendable equipment expense
Metered postage
Office supplies
Parts and accessories
Shop supplies
Small tools
Total commodities
1,900.00
50,000.00
126.00
5,000.00
200,000.00
12,000.00
5,000.00
274,026.00
475.00
12,500.00
31.50
1,250,00
50,000.00
3,000.00
1,250.00
66,505,50
55,805.28
0.39
134.34
34,571.40
2,376.46
220,52
93,108.39
475.00
(43,305.28)
31.11
1,115.66
15,428.60
023.54
1,029.48
(24.601.89)
0.03%
0.80%
0.00%
0.03%
3.18%
0.19%
0.08%
4.36%
0.00%
3,56%
0.00%
0,01%
2.21%
0,15%
0.01%
5.94%
Depredation:
Equipment, structures and tower rights
Total depreciation
3,912,925.00
3,912,925.00
62.30% 978,231.25 1,477,717.45 94.27% (499,486,20)
62.30% 978,231,25 1,477,717.45 94.27% (499,48620)
0.45%
0.01%
19.12%
0,00%
3.41%
0.22%
0.55%
0.10%
0.45%
0.00%
5.62%
0,46%
3.59%
0.04%
0.06%
0.20%
Internal services:
Building space allocation
Convenience copier
Info Tech - GLEMIS
Info Tech - development
Info Tech - operations
Insurance fund
Maintenance department charges
Motor pool fuel charges
28,133.00
384.00
1,201,000.00
214,032.00
13,910.00
36,000.00
6,331,00
7,033,25
96.00
300,254,00
53,508,00
3,477.50
8,700.00
1,582.75
7,033,26
21.64
88,017.68
7,259.00
56,344.00
660.72
945.56
3,129.67
(0.01)
74.36
212,232.32
(7,259.00)
(2,836.00)
2,816.75
7,804.44
(1,546.92)
County of Oakland
Radio Communications Fund
Statement of Revenues, Expenses, and Changes in Net Assets
For the Three Months Ended December 31, 2013
Motor pool
Telephone communIcatIons
Total Internal services
Total operating expense
Operating income (loss)
2014
Amended Percent of
Budget Revenue
18,201.00 0.29%
27,574.00 0.44%
1,544,585.00 24.59%
9,520,472.00 151.58%
(3,239,472.00) -51.58%
Year to Date
Percent of
Allotment Actual Revenue
4,560.26 9,118.41 0.58%
6,893.50 7,692.95 0.49%
386,141,25 180,222.90 11.50%
2,380,118.00 2,557,906.74 163.19%
(809,868,00) (990,448.79) -53.19%
Favorable
(Unfavorable)
Variance
(4,568.16)
(799.46)
205,918.36
(177,790.74)
(180,580.79)
Nonoperating revenues (expenses)
Budgeted equity adjustment
Income (loss) from investments
Total nonoperating revenues (expenses)
Income (loss) before transfer
Transfers in
Transfers out
Change in net assets
Total net assets - beginning
Total net assets - ending
3,520,972,00
180,000.00
3,700,972.00
461,500.00
24,500.00
(486,000.00)
$ .
58.06%
2,87%
68.92%
7,35%
0,39%
-7,74%
0.00% $
880,243,00
45,000,00
925,243.00
115,375,00
6,125.00
(121,500,00)
,.
. 0.00% (880,243.00)
35.204.97 2.25% (9,795,03)
35,204.97 2.25% (890,038.03)
(955,243.82) -60,94% (1,070,618.82)
4,500,00 0,29% (1,625.00)
(121,500.00) -7.75% -
(1,072,243.82) -68,41% $ (1,072,243.82)
51,331,927.82
850,269.664.00
EXHIBIT A-2
Description
Budgeted Operating Transfer from Radio fund to Info Tech fund for
1st quarter FY 2014 OakNet operation costs regarding the
extension of the E911 surcharge approved on Res. 10-076
Budgeted Operating Transfer from Radio Communications fund to
CLEMIS fund for 1st quarter FY 2014 administrative support
Budgeted Operating Transfer from Radio Communications fund to
Info Tech fund for 1st quarter FY 2014 Help Desk support
Amount
59,000.00
50,000.00
12,500.00
Total $121,500.00
EXHIBIT A-3
Description Amount
Transfer from General fund, Sheriffs Dept. to Radio Communications 4,500.00
fund per Res. 13-224 for an Amendment to Sheriff's contract with
Orion Township.
Total $4,500.00
EXHIBIT A-4
RADIO COMMUNICATIONS FUND 53600
Fiscal Year 2014 — 1st Quarter
Brief Explanation of "Aetuals"
Following are some comments regarding Radio Communications Fund's 1st quarter FY 2014
financial statements.
STATEMENT OF NET ASSETS
• Radio Communications Fund reports all monetary assets as Cash. Available cash is invested
and managed by the Treasurer as a pool. Participating funds receive interest earnings based
on their percentage of the invested daily cash balance each month.
• Accrued interest on investment is interest earned by the fund on its cash balance in the
Treasurer's pool of investments; interest is paid when investments mature.
• Due from other governments is the amount due from municipalities for leased equipment.
• Accounts receivable includes $1,348,000 for accrued E-911 operational surcharge revenue
which is paid to the County quarterly. The balance is rent due from antenna site co-locators
and amounts due from non-governmental external users for leased equipment.
• Inventories are parts and accessories to maintain customer equipment and the radio system
including equipment purchased from Harris Corp. on completion of the radio system.
• Prepaid items are rent paid in advance per the lease agreements for co-location of radio
system equipment and maintenance contracts paid in advance,
• Effective FY 2002, the Radio Communications Fund was classified as an Enterprise Fund
with a capitalization threshold for Equipment of $5,000. The 821 MHz radio system was
fully operational on July 1, 2010 and all related asset expenditures for equipment and radio
tower structures were originally capitalized with a ten-year life. The useful-lives for all
portable and mobile radios were recently updated to end in 2017, when this equipment will
no longer be supported.
• Tower rights are the County's rights to co-locate equipment on towers constructed by the
Radio Fund on land owned by various municipalities. Ownership of the towers was
transferred to the municipalities upon completion of construction in 2010 in exchange for
ongoing rights to place radio equipment on those towers.
• Vouchers payable and Accounts payable are accrued 1st quarter expenses and prior year's
over-payments by E911 surcharge filers.
• Due to Municipalities is the City of Novi's share of lease payments by co-locators on Novi's
antenna site.
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS
Revenues:
• The Board of Commissioners Resolution 13-077 maintained the E-911 surcharge rate of
$0.20 for the period covering July 1, 2013 through June 30, 2014. The revenue reported for
the first quarter is based upon the prior year's filings at the same rate.
• Antenna site management is revenue from telecommunication companies that have placed
equipment on county owned towers. The first quarter's revenue is based upon the estimated
revenue anticipated from all Oakland County contracted telecommunications companies.
• Outside agency revenue is unfavorable due to fewer than anticipated non-public safety users
of the new system within Oakland County departments and outside agencies.
Prepared by: Y. Tipton — Fiscal Services
RADIO COMMUNICATIONS FUND 53600
Fiscal Year 2014 — 1st Quarter
Brief Explanation of "Actuals"
• Parts and accessories and Productive labor revenues are both favorable due to increasing
orders for replacement of damaged equipment by participating agencies.
• The Prior year's adjustment is for an E91I settlement agreement accepted with AT & T
Corporation.
Expenses:
• Salary variance is favorable due to lower than anticipated overtime, on-call payroll and
unfilled positions.
• Fringe benefit variance is favorable because budgeted amounts are based on average fringe
benefit cost.
• Communications cost is unfavorable due to additional connectivity costs for several cell
tower sites used for coverage enhancements of the Radio system.
• Contracted services are for leased space at Oakland County International Airport.
• Electrical service is favorable due to decreased seasonal utility demand at tower sites.
• Equipment repairs and maintenance expense is unfavorable due to higher than anticipated
maintenance costs of the radio system.
• Indirect cost expense is based on the County's Indirect Cost allocation. It includes Human
Resources, Payroll, Treasurer, Accounting, and Budgeting and Administrative services. The
final allocation was established after adoption of the current budget.
• Maintenance contract expense is favorable due to the elimination of the Advanced Wireless
Telecom contract for Open Sky maintenance and support. Maintenance for this equipment is
now done in-house.
• Professional services expense is favorable due to the timing of costs relating to the CAD
Upgrade project.
• Software rental, lease purchase is unfavorable due higher than anticipated budgeted cost.
• Software support and maintenance is unfavorable due to reclassification of E911 related costs
after adoption of the budget.
• Special projects expense is favorable due to timing of proj ects.
• Travel and conference expense is favorable due to timing of expenditures and cost-cutting.
• Dry goods and clothing is favorable due to cost-cutting measures,
• Expendable equipment is unfavorable primarily due to the purchase of equipment required
for the CAD Upgrade project.
• Parts and accessories expense is favorable due to lower than anticipated parts cost.
• Small tool expense is favorable due to decreased usage.
• Depreciation is unfavorable due to the reduction of useful-lives for all portable and mobile
radios.
• Internal Service expense is favorable overall based on reduced actual usage.
Info Tech-CLEMIS charges are for the support of MDC, E911, and CAD operations.
Prepared by: Y. Tipton — Fiscal Services 2
RADIO COMMUNICATIONS FUND 53600
Fiscal Year 2014 — 1st Quarter
Brief Explanation of "Aetuals"
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS (Cont'd1
Non-Operating Revenues and Expenses:
• Budgeted equity adjustment represents the amount that is an offset to total revenue to balance
Radio Fund's FY 2014 budget per Fiscal Services management.
• Income from investment revenue is unfavorable due to a decrease in market value of the
County's pooled investments. All of Radio Fund's available cash, including cash received
for the E-91I operational surcharge, is invested in the pool managed by the Treasurer.
• Transfers in includes amounts received from the General Fund per Resolution 13-224 for
costs relating to an Amendment to the Sheriff's contract with Orion Township.
• Transfers out includes $62,500 for administrative and operating support provided by the
CLEMIS and Information Technology Funds. A budgeted operating transfer for $59,000
was also made to the Information Technology fund for OakNet operation costs relating to the
extension of the E911 surcharge as approved on Resolution 10-076.
Prepared by: Y. Tipton — Fiscal Services 3
Resolution #14071 April 17, 2014
Moved by Crawford supported by Zack the resolutions (with fiscal notes attached) on the amended
Consent Agenda be adopted (with accompanying reports being accepted).
Discussion followed.
Vote on amended Consent Agenda:
AYES: Dwyer, Gershenson, Gingell, Gosselin, Hatchett, Hoffman, Jackson, Long, Matis,
Middleton, Quarles, Runestad, Scott, Spisz, Taub, Weipert, Woodward, Zack, Bosnic,
Crawford. (20)
NAYS: None. (0)
A sufficient majority having voted in favor, the resolutions (with fiscal notes attached) on the amended
Consent Agenda were adopted (with accompanying reports being accepted).
I HEREBY APPROVE THIS RESOLUTION
CHIEF DEPUTY COUNTY EXECUTIVE
ACTING PURSUANT TO MCL 46.550A (7)
STATE OF MICHIGAN)
COUNTY OF OAKLAND)
I, Lisa Brown, Clerk of the County of Oakland, do hereby certify that the foregoing resolution is a true and
accurate copy of a resolution adopted by the Oakland County Board of Commissioners on April 17, 2014,
with the original record thereof now remaining in my office.
In Testimony Whereof, I have hereunto set my hand and affixed the seal of the County of Oakland at
Pontiac, Michigan this 17 th day of April 2014.
Lisa Brown, Oakland County