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HomeMy WebLinkAboutMinutes - 2007.06.07 - 36183MIKE ROGERS Chairperson EILEEN KOWALL Vice Chairperson HELAINE ZACK Minority Vice Chairperson June 7, 2007 Chairperson Rogers called the meeting of the Finance Com mittee to order at 9:11 a.m., in the Board of Commissioners' Committee Room A, Commissioners' Wing, County Service Center, Pontiac, Michigan. COMMITTEE MEMBERS PRESENT Mike Rogers, Eileen Kowall, Helaine Zack, Sue Ann Douglas, Hugh Crawford, Tom Middleton, Christine Long , Helaine Zack, Dave Coulter, Tim Greimel COMMITTEE MEMBERS ABSENT WITH NOTICE Jeff Potter, David Woodard OTHERS PRESENT CLERK Joe Rozell, Director of Elections EMERGENCY RESPONSE Gail Novak, Chief EXECUTIVE OFFICE Jerry Poisson, Deputy Bob Daddow, Deputy Phil Bertolini, Deputy FISCAL SERVICES Tim Soave, Manager Nancy Fournier, Chief LaVerne Smith, Supervisor Linda Pearson, Analyst Monica Tinsley, Analyst HUMAN RESOURCES Nancy Scarlet, Director Jennifer Mason, Manager Judy Fandale, Supervisor INFORMATION TECHNOLOGY Ed Poisson, Director Janette McKenna, Chief MANAGEMENT AND BUDGET Laurie Van Pelt, Director Art Holdsworth, Deputy Director PURCHASING Scott Guzzy, Chief SHERIFF Michael McCabe, Undersheriff Dale Cunningham, Business Manager AXE & ECKLUND John Axe, President COMMUNITY MENTAL HEALTH Mary Griffiths, Director of Admin. Operations OAKLAND COUNTY BOARD OF COMMISSIONERS 1200 N. TELEGRAPH ROAD, PONTIAC, MI 48341-0470 Telephone (248) 858 -0100 FAX (248) 858-1572 FINANCE COMMITTEE Sue Ann Douglas Hugh D. Crawford Tom Middleton Christine Long Jeff Potter David Coulter David Woodward Tim Greimel FINANCE COMMITTEE Page 2 June 7, 2007 OTHERS PRESENT CONTINUED BOARD OF COMMISSIONERS Larry Doyle, Administrative Director Harvey Wedell, Sr. Analyst Sheryl Mitchell, Sr. Analyst Julia Ruffin, BOC Liaison Helen Hanger, Sr. Committee Coordinator APPROVAL OF THE PREVIOUS MINUTES Middleton moved approval of the minutes of May 17, 2007 as printed. Supported by Douglas. Motion carried on a voice vote. PUBLIC COMMENT None. 5. FY 2007/FY 2008 C ONTINGENCY REPORT The Contingency Fund balance of $310,221 will remain unchanged by actions taken at today’s meeting. Kowall moved to receive and file and Contingency Report dated June 1, 2007. Supported by Middleton. Motion carried on a voice vote. AGEMDA Items #8 (Sheriff’s Office – FY 2007 Global Arson Grant Acceptance) and #13 (Department of Management and Budget / Purchasing Division – Request Renewal of Contract Coats Communication ) were removed from the agenda as they had not yet been presented to their liaison committees. There were no objections. REGULAR AGENDA 6. DEPARTMENT OF HEALTH AND HUMAN SERVIC ES/HEALTH DIVISION – 2007 MARCH OF DIMES CHAPTER COMMUNITY GRANT AWARD FOR THE TRANSPORTA TION OF PREGNANT WOMEN – GRANT ACCEPTANCE The Health Division is requesting acceptance of a $15,000 grant from the March of Dimes Michigan Chapter, Transportation for Pregnant women Project. Funds will b e used to purchase approximately 150 round-trip transports for non-Medicaid pregnant women for prenatal care visits. No County match is required and existing staff will be utilized to administer the program. A budget amendment will be made as outlined in the Fiscal Note. Zack moved approval of the attached suggested Fiscal Note. Supported by Coulter. Motion carried unanimously on a roll call vote. 7. COUNTY EXECUTIVE – EMERGENCY REPONSE AND PREPAREDNESS – PERFORMANCE GRANT AGREEMENT FOR FISCAL YEAR 2007 ACCEPTANCE Emergency Response and Preparedness is requesting acceptance of a $44,996 grant from the Michigan Department of State Police Emergency Management Homeland Security Division for the purpose of FINANCE COMMITTEE Page 3 June 7, 2007 developing comprehensive disaster preparedness and assistance plans, programs, capabilities and organizations by the State and local governments for FY 2007. The grant also funds a portion of the ERP administrator’s salary and fringe benefits. Revenue from thi s agreement is already included in the FY 2007 budget. Coulter moved approval of the attached suggested Fiscal Note. Supported by Douglas. Motion carried unanimously on a roll call vote. 9. DRAIN COMMISSIONER – GEORGE W. KUHN DRAINAGE DISTRICT REFUN DING BONDS – FULL FAITH AND CREDIT The George W. Kuhn Drainage District Board, through the Drain Commissioner, is requesting that the Board of Commissioners pledge the County’s full faith and credit for payment of principal and int erest on Drain Refunding Bonds, Series 2007 in an aggregate principal amount not to exceed $13,500,000 to refund all or a portion of Series 2000B Drain Bonds maturing in the years 2010 through 2022 and Series 2001E Drain Bonds maturing in the years 2013 through 2024, bearing inte rest rates not to exceed 6%. Series 2000B Drain Bonds were originally issued in the amount of $6,570,000 per MR #00188, at an interest rate of 8%. Series 2001E Drain Bonds were originally issued in the amount of $9,870,000 per MR #01201, also at an interest rate of 8%. This action will achieve debt service savings for fourteen southeastern Oakland County communities as identified in the resolution. Douglas moved approval of the attached suggested Resolution. Supported by Greimel. Motion carried unanimously on a roll call vote. 10. MR #07134 – HUMAN RESOURCES DEPARTMENT – SALARY ADMINISTRATION PLAN 2 ND QUARTERLY REPORT FOR FY 2007 The Human Resources Department has completed its review of 3 classifications / 6 positions under the Salary Administration Plan and is recommending that all 3 classifications / 6 positions be upgraded as detailed in the written material. Budget amendments will be made as outlined in the Fiscal Note. Middleton moved approval of the attached suggested Fiscal Note. Sup ported by Douglas. Motion carried unanimously on a roll call vote. 11. MR #07133 – DEPARTMENT OF INFORMATION TECHNOLOGY – SECOND QUARTER 2007 DEVELOPMENT APPROPRIATION TRANSFER Information Technology is requesting authorization to appropriate and char ge 2007 Second Quarter development costs to benefiting departments. Charges are $1,158,828.69 for data processing development, $17,498.24 for imaging development for General Fund/General Purpose departments, $279,221.72 in direct charges to Special Revenu e and Proprietary fund departments, $97.60 for non - governmental imaging development and $372.10 to non -county agencies. Potter moved approval of the attached suggested Fiscal Note. Supported by Kowall. Motion carried unanimously on a roll call vote. FINANCE COMMITTEE Page 4 June 7, 2007 12. DEPARTMENT OF MANAGEMENT AND BUDGET – FISCAL YEAR 2007 SECOND QUARTER FINANCIAL FORECAST AND BUDGET AMENDMENTS Management and Budget is requesting authorization to implement various budget amendments as detailed in the Resolution in accordance with the General Appropriations Act, Sections 22 and 23. The June 1, 2007 Letter of Transmittal indicates an overall favorability of $14,926,799 in General Fund/General Purpose operations resulting from receiving $13,486,129 more revenue than anticipated and e xpending $1,440,670 less than budgeted. Mr. Soave explained several of the larger details of the forecast. Favorable revenue of $10.3 million is a result of this being the last year for the County to receive an accelerated tax payment due to the tax shift and would not be repeated. Investment income is slightly up over what was budgeted due an increase in interest rates but, over time with a tightening budget, cash flow will decrease and there will be less to invest. Convention facility tax dollars received were more than anticipated but may be cut by the State next year. Cigarette Tax revenue has declined . Expenditures were less than budgeted primarily due to staff turnover. This figure is shrinking as more people hold on to their jobs due to the slow economy. Unfavorability in the Sheriff’s Office is a result of a budgeting error for fringe benefits. The Deputies Contract has been in negotiation for four years and every year the assumed salary increase was built into the budget but the impact to fringe benefits was not included. This has been corrected for 2008. Several other issues of unfavorability within Central Services and Public Services will be addressed with second quarter budget amendments. Fuel cost increases will be addressed with the third quarter report. Commissioner Douglas asked that Management and Budget produce a 10 -year chart to show the changes in the County’s budget favorability. Commissioner Zack asked why the County had received additional Court Equity of $424,600. Mr. Soave explained that Court Equity is based on a State formula involving the number of cases in the County’s Circuit and Proba te Courts. Convention Facilities Tax, coming from both hotel and liquor taxes, is also formula based and fluctuates. All hotel tax es go to pay down Cobo Hall debt. Oakland County gets a portion of the liquor tax payment but all 80 out-state counties get their entire liquor payment and a portion of the tri-county as well. To remain conservative, th e County takes the State’s estimate for Convention Facilities Tax and reduces it. Public Services/Animal Control is unfavorable as a result of their being first responders so the County is required to provide rabies shots every few years and this was not budgeted for. They are also doing mo re spading and neutering. Zack moved approval of the attached suggested Resolution . Supported by Douglas. Motion carried unanimously on a roll call vote. 14. RESOLUTION APPROVING SUBLEASE IN CONNECTION WITH THE OAKLAND COUNTY COMMUNITY MENTAL HEALTH AUTHORITY HOUSING PROJECT LOCATED IN OAKLAND COUNTY The resolution would authorize a sublease between the County of Oakland and the Oakland County Community Mental Health Authority (CMH) for 18 existing group home facilities to be acquired by the Oakland County Building Authority. The Sublease provides that the Building Authority is authorized to issue bonds in the aggregate principal amount of not to exceed $5,500,000, at a net interest cost not to exceed 4.75% per annum . Mr. Daddow explained that this action will save CMH no less than $150,000 a year and will build equity after 20 years once the bonds are paid off. The County’s $9.6 million annual match to CMH would cover debt service payments if CMH cannot. The Administration has talked to Moody’s and Standard and Poors and they are very favorable on this type of sharing arrangement . FINANCE COMMITTEE Page 5 June 7, 2007 Messrs. Daddow and Axe explained that about 95% of what the County borrows is for others, mostly for Drain activities. A very small amount is used for County purposes, such as the Rochester Hills Substation and the Work Release facility. The County’s AAA Bond Program requires that the project must be for a government oriented purpose and must be a physical asset. Until that asset is paid off, title rests with the Building Authority. This specific project is relative to County government because the Board of Commissioners appoints CMH Board members and the County provides a local funding match. Zack moved to recommend approval of the attached suggested Fiscal Note . Supported by Kowall. Motion carried on a voice vote. 15. HUMAN RESOURCES DEPARTMENT – DEFERRED DEFINED BENEFIT RETIREMENT BUYOUT Human Resources is requesting authorization to initiate a Deferred Retirement Buy -Out Plan to offer deferred retirees the opportunity to buy-out accrued, vested retirement benefits through a “Lump -Sum” payment actuarially equivalent to the present value of their accrued benefit, contingent upon the deferred retiree’s signed waiver of rights to any and all other retirement we lfare benefits, including the right to future County funded health c are. Vested former employees will be notified in writing that they have an irrevocable one time election continuing for no less than seven days and not more than sixty days to decide whether to participate in the Buy -Out Plan. Those who accept a lump -sum buy-out, effective September 1, 2007, will be able to rollover these fund to another tax -qualified retirement plan or Individual Retirement Account. Ms. Fandale explained that on two p rior occasions the County had offered such a buyout program. The first time was in 1994 with 160 people participating at a cost of $5.1 million, saving $34 million in future health care costs. The second program was offered in 1998 with 32 people particip ating at a cost of $1.2 million, saving $6.8 million in future health care costs. There are currently 224 deferred retirees eligible for this new program. Funds for lump sum payments will be drawn from the assets of the Oakland County Public Employees’ Retirement System, which is fully funded. Commissioner Rogers asked that the Administration report back on the number of individuals who take the buyout. Zack moved to recommend approval of the attached suggested Fiscal Note. Supported by Middleton. Motion carried on a voice vote. 16. AN ORDINANCE TO CONFIRM AND RESTATE OAKLAND COUNTY’S EXISTING CONTRACTUAL OBLIGATIONS TO PROVIDE FOR MEDICAL BENEFITS FOR CERTAIN RETIRED COUNTY EMPLOYEES AND THEIR ELIGIBLE DEPENDENTS The Ordinance, which shall be known and may be cited as the Retiree Medical Benefits contractual Obligations Ordinance, is intended to provide a clear, comprehensive confirmation, reaffirmation and restatement of the County’s contractual obligations to p rovide retiree medical benefits . The ordinance provides a history of the County’s obligations for retiree medical benefits, confirms existing contractual obligations and provides for dispute resolution and severability. The ordinance shall become effective upon adoption by the Board of Comm issioners and approval by the County Executive. Mr. Axe explained that the ordinance also identifies in chronological order the many things that the County has done in the retiree health care area since these benefits were granted to retirees in 1965. FINANCE COMMITTEE Page 6 June 7, 2007 Mr. Poisson explained that after doing some research they felt that by taking action through ordinance, rather than resolutions which perform the ministerial functions of government, the County would be provided with the permanency and the legal power to provide for this alternative funding mechanism. If a future Board were to rescind this action, they would still be bound to pay off the debt. Middleton moved to recommend approval of the attached suggested Ordinance. Supported by Kowall. Crawford moved to amend the ordinance to add Section 8, Section 8. Authority to adopt ordinance. The Oakland County Board of Commissioners is granted authority by Section 6 of Public Act No. 139 of the Public Acts of Michigan of 1973, as amended, to adopt ordinance s necessary for the conduct of county business. Supported by Kowall. Motion to amend carried on a voice vote. Main motion, as amended, carried unanimously on a roll call vote . 17. ORDINANCE TO ESTABLISH AN ALTERNATIVE FUNDING MECHANISM FOR OAKLAND COUNTY TO FULFILL ITS CONTRACTUAL OBLIGATIONS TO PROVIDE RETIREE MEDICAL BENEFITS FOR RETIREES AND CERTAIN ACTIVE EMPLOYEES OF THE COUNTY; TO AUTHORIZE THE FORMATION BY THE COUNTY OF AN OAKLAND COUNTY RETIREE MEDICAL BENEFITS FUNDING TRUST FOR THE PURPOSE OF ISSUING TAXABLE CERTIFICATES OF PARTICIPATION TO PROVIDE FUNDS TO PAY A SPECIFIED AMOUNT OF THE UNFUNDED ACCRUED ACTUARIAL LIABILITIES OF THE COUNTY FOR THE ESTIMATED COSTS OF FULFILLING SUCH OBLIGATIONS; AND TO APPROVE THE FORM OF A CONTRACT BETWEEN THE CO UNTY AND SUCH FUNDING TRUST The Ordinance, which shall be known as the Retiree Medical Benefits Funding Ordinance, shall authorize an alternative to the County’s traditional mechanism for funding the costs of fulfilling its contractual obligations to provide retiree medical benefits (an “Alternative Funding Mechanism”) to better maintain the actuarial integrity of its retiree medical benefits (RMB) program and to reduce the financial burden to the County of the Subject RMB unfunded accrued actuarial liabi lities (UAAL). The Alternative Funding Mechanism will enable the County to enter into a transaction (the “Funding Transaction”) to fund the subject RMB UAAL. The Ordinance shall establish the Funding Trust (defined within the ordinance), designed to work in conjunction with the Intermediate Trust (defined within the ordinance) and the Voluntary Employee Benefit Association Trust (VEBA Trust) and the County’s entering into a related contract with the Funding Trust as a means for the County to fund the Sub ject RMB UAAL. The ordinance shall become effective upon adoption by the Board of Commissioners and approval by the County Executive. The draft ordinance includes revisions to the language to require the Chairperson of the Board of Commissioners and Co unty Clerk, and not the County Executive, to executive the contract and require the Chairperson’s approval of any changes to the ordinance. Crawford moved to recommend approval of the attached suggested Ordinance. Supported by Kowall. FINANCE COMMITTEE Page 7 June 7, 2007 Motion carried unanimously on a roll call vote . 18. RESOLUTION APPROVING THE 2007 OAKLAND COUNTY INTERMEDIATE RETIREE MEDICAL BENEFITS TRUST AGREEMENT BETWEEN THE COUNTY AND THE TRUSTEES DESCRIBED THEREIN, ESTABLISHING THE 2007 OAKLAND COUNTY INTERMEDIATE RETIREE MEDICAL BENEFITS TRUST The resolution establishes the 2007 Oakland County Intermediate Retiree Medical Benefits Trust (the “Intermediate Trust”), identifies initial Trustees as the same persons who are Commissioners of the Oakland County Employees Retirement Sys tem, indicates that all withdrawals from the Trust shall be solely for payment of Retiree Medical Benefits and administrative expenses of the Trust, indicates that the Trust and fund therein will be established on an actuarial basis, identifies that the Co unty Executive or any Deputy County Executive, acting on behalf of the County Executive, is provided authority to execute and deliver the Trust Agreement and all such other and further agreements and other documents and to do or cause to be done all such o ther and further acts necessary in connection with the Int ermediate Trust Agreement. The resolution shall take immediate effect upon its adoption and signature of the County Executive. Douglas moved to recommend approval of the attached suggested Ordin ance. Supported by Zack. Motion carried unanimously on a roll call vote. COMMUNICATIONS A. Department of Management and Budget / Purchasing Division – Contract Exception Report for the Month of May, 2007 B. 52-1 Novi District Court, FY 2008 SCAO Gran t – Drug Court Grant Application C. 52-2 Clarkston District Court, FY 2008 SCAO Grant – Drug Court Grant Application D. Circuit Court/Family Division - FY 2008 Michigan Drug Court Continuation (SCAO) – Juvenile Drug Court Grant - Application E. Circuit Court/General Jurisdiction - FY 2008 Michigan Drug Court Continuation Grant Program Through the State Court Administrative Office (SCAO) Adult Drug Court Grant - Application F. Circuit Court / Friend of the Court FY 2008 – Cooperative Reimbursement Contra ct Application G. Sheriff’s Office – FY 2007 Jail Alliance with Support for Inmates with Co -Occurring Disorders Grant Application H. Economic Development & Community Affairs Department – Planning & Economic Development Services – 2007 Rouge Green Corrido r Identify Demonstration Project – Phase 2 Grant Application I. Economic Development & Community Affairs – Marketing & Communications/Arts & C ulture – FY 2008 Michigan Council for Arts and Cultural Affairs Administration Program Grant Application J. Department of Information Technology – CLEMIS Funds – Financial Statements and Schedules for the Six Months Ended March 31, 2007 FINANCE COMMITTEE Page 8 June 7, 2007 K. Notice of Hearing to Request an Industrial Exemption Certificate for FACTON Inc. Located at 3250 University Dr., Suite 105, Aub urn Hills MI 48326 Middleton moved to receive and file Communications A - K. Supported by Greimel. Motion carried on a voice vote. OTHER BUSINESS/ADJOURNMENT Chairperson Rogers asked that budget hearings be scheduled for all departments. There being no other business to come before the committe e, the meeting was adjourned at 10:32 a.m. ________________________ _______________________________ Helen A. Hanger Lawrence M. Doyle Senior Committee Coordinator Administrative Director NOTE: The foregoing minutes are subject to Committee approval.