Minutes of The Special Price City Council Meeting
City Hall: Price, Utah
May 3, 2000, 5:00 p.m.
Mayor Lou Colosimo
Roy A. Nikas Joanne Lessar, City Recorder
Betty P. Wheeler Pat Larsen, Finance Director
Joe L. Piccolo Keith Wight, Human Resource Director
Stephen L. Denison Gary Sonntag, PWD/City Engineer
1. ORDINANCE #2000-004 - Regulation of Telecommunications Rights of Way In Price City
FRANCHISE AGREEMENT - Carbon/Emery Telcom, Inc.
Joanne Lessar presented Ordinance #2000-004, an ordinance for the regulation of telecommunications rights-of-way in Price City. She also presented a franchise agreement with Carbon/Emery Telcom, Inc. Upon approval from the Public Service Commission, Carbon/Emery Telcom, Inc., will purchase from U.S. West, the telephone communications system throughout Price City and Carbon County. MOTION. Councilmember Nikas moved that Ordinance #2000-04 be adopted, that the Mayor and City Recorder be authorized to sign the ordinance and that it become effective 20 days after publication. Further, that the franchise agreement be approved, that the Mayor and City Recorder be authorized to sign the agreement and that the term and renewal of the agreement be set at ten (10) years. Motion seconded by Councilmember Tatton and carried.
2. BUDGET WORKSHOP - FY2000/01
Pat Larsen reported that the budget is out of balance by $1.7 million. She presented a summary of estimates of employee earnings and benefits for the fiscal year 2000/2001. The only options of changing anything for retirement is on the 401K portion. There is presently a limit of 15.6% set for retirement costs. Of that, .06 is for long term disability, 4.5% is the portion that the City contributes to the 401K plan, plus 10.31% to the Utah State Retirement System. Pat indicated that approximately 45% of employees participate in the 401K. Councilmember Nikas recommended that the City should participate on the 401K only with those employees that are participating themselves. If the employee puts in a dollar, the City puts in $.50 or based on a percentage of their gross income. Councilmember Denison recommended dollar per dollar up to 3%. Councilmember Nikas stated that he would rather see a cut back on the benefits and save money and turn around and plug the difference of that money in wages as long as it doesn’t exceed last years budget. Councilmember Piccolo stated that there will be an increase in wages over last years budget. You can put what you save from other benefit areas back into wages. The benefit package of Price City does keep even the entry level employees here. The first couple of years may not have an effect on them, but a big portion of our work force is on the lower end of the pay scale. If they are not here for the benefits, they are certainly not here for the wages. He feels our retirement is a rich program, but he also would like to give the employee when they are young the opportunity to have a few more dollars on their check, but also have the ability to donate to their retirement when they can. They need to be educated to realize if they donate $15/month to their retirement fund what it will do for them in 10-15 years. He feels the City has not taken the time to explain to employees what is there. He would like to see this take place as part of this process before we go in and chop it down. He would like to take one year and inform employees about the 401K and what it will build over a period of time. If you have someone making $9/hour and you tell them he is getting too much retirement, he is not sure it will come across very well. Councilmember Nikas stated that the City is already contributing 10.31% to retirement, excluding the Police Department. Councilmember Piccolo feels there are a lot of employees working for the City because of the benefits. Councilmember Wheeler agreed that is where the job market it. Councilmember Piccolo recommended working on the health benefits. How much would this save in comparison with retirement. Perhaps go to a higher deductible and ask the employee to pay more of their health insurance instead of retirement. After further discussion, it was the general agreement to match up to 3% for the employee’s 401K program, including the Police Department.
Pat stated that medical insurance costs increased $85,000. This does not include the rate for the new option of $500 deductible. If the Council chose this option for medical coverage, it would cost the City $15,000 over last years costs. Councilmember Nikas recommended keeping medical costs at what they were last year. He would like to see participation on the employees side for dependents and that whatever the savings is between this year and last years budget, that this amount be applied towards wage increases. Does the City want to give employees more wages across the board if it can save on health insurance benefits by having them participate on their dependents cost. Councilmember Piccolo stated that his would be unfair for those employees that make only $10.00/hour and have a wife and family. The $80/month doesn’t mean much for someone making $3,000/month, but it will mean a lot for the $10/hour man to have to pay part of the medical for his wife and kids plus the deductible. Councilmember Wheeler agreed. There are at least 40 employees who earn less that $10-$12/hour. Councilmember Nikas stated that those employees making $10-$12/hour should be making $12-$14/hour. Councilmember Piccolo stated that the City wouldn’t save that much to be able to give that type of raise to them. Health costs raise no matter what you do. This is an employee cost. Employees are your most valuable asset. This is part of doing business. In regards to medical coverage, it was recommended that the $500 deductible option be selected and that employees participate by paying 10% of dependent costs.
The Council discussed the Cafeteria Plan submitted by Utah Local Governments Trust. A concern was expressed pertaining to the cost of check charges. Each time a claim is submitted and a check issued, the City would be charged a fee for the check. Councilmember Nikas directed that Keith Wight request proposals on different cafeteria plans.
The request for new employees was discussed. Pat indicated the budget for wages for temporary employees is $138,000. It was recommended that the pool supervisor be hired to replace Scott McDonald, but that the Assistant Pool Supervisor and Parks/Cemetery Laborers be eliminated.
Pat stated that the 3.3% cost of living increase will cost of $93,000 and the 2-3% anniversary increase will cost $75,000.
Overtime costs were reviewed and it was recommended that the overtime be budgeted the same as last year.
Councilmember Nikas stated that from the last meeting versus this meeting, he would like to take the $100,000 budgeted for storm drain work taken out of Capital Improvements instead of the Street Dept. budget. This leaves the $100,000 extra to add to the $378,000 in projects. This would expand the number of street projects that need to be done so that the waterline projects can be caught up.
Pat presented the list for equipment leases. Those items include a truck for the Inspection Dept., 2 cars for the Police Dept., a sedan for Public Works, a grader and asphalt milling machine for the Streets Dept., a 3/4 ton dump truck for the Parks Dept., and an imaging system for the IS Dept. The only change is to lease the grader for 5 years instead of 3 years and possibly look for a used one.
Pat indicated with what was saved in insurance, overtime, and benefits, the budget is still out of balance $1.6 million. The General Fund has a fund balance of $779,000, Class ‘C’ Roads has a fund balance of $79, 000, which is being used, the Electric Fund has a fund balance of $2 million, and the IS Dept. has a fund balance of quarter of a million. It was recommended to take the following amounts out of fund balance - $229,000 out of the General Fund, $1 million out of the Electric Fund, and $200,000 out of the IS Dept. The budget of $70,000 to remodel the Library was deleted, and $40,000 was cut from the Swimming Pool. Pat stated that there is also an additional $100,000 that was going to be used for Meads Wash, which the funds for that are going to be taken out of Fund Balance. Pat stated that she will take the above numbers, rework the budget to see where it stands.
Meeting adjourned at 7:45 p.m.