Tuesday, May 21,2002
St. George City Council Minutes
May 21, 2002 7:00 A.M.
Administrative Conference Room
Mayor Daniel McArthur
City Council Member Rod Orton
City Council Member Suzanne Allen
City Council Member Robert Whatcott
City Council Member Larry Gardner
City Manager Gary Esplin
City Attorney Jonathan L. Wright
Deputy City Recorder Ren? Fleming
Assistant to the City Manager Mark Mortensen
City Attorney Wright offered the opening prayer. The Mayor welcomed everyone to the early morning meeting.
Consider resolution proposing the creation of the southwest Mosquito Abatement and Control District for the purpose of providing mosquito abatement services to the municipalities and unincorporated areas of Washington County and providing that a Public Hearing and an election to be held on the question of whether the district should be created.
The Mayor explained this resolution would set a public hearing for June 6, 2002 at 6:00 p.m. It would create a map that shows the areas involved in the district. He commented that there haven't been a lot of complaints for a few years.
Council Member Orton made a motion to approve the resolution and set the public hearing for June 6, 2002 at 6:00 p.m. Council Member Gardner seconded the motion. The Mayor called for a roll call vote
Council Member Gardner – aye
Council Member Whatcott – aye
Council Member Orton – aye
Council Member Allen - aye
Review and Discussion of Fiscal Year 2002 – 2003 Budget
City Manager Esplin began the discussion by reviewing the revenue projections. The general fund was reviewed. Property tax is projected to be $4 million, which is about a 5% increase based on the new growth. Sales tax is estimated at $8.9 million or it may reach $9 million for the current year, 2002 – 2003 is estimated at $9.2 or a 2% increase. The franchise fees are increased as a result of higher utility rates. There is no change in licensing and permits revenues from the current fiscal year. He noted the airport has been taken out of general fund and a new fund created titled the Replacement Airport Fund. Grant revenues are approximately $350,000 and are primarily police grants. There are about $100,000 in trail grants from the State. He explained the City should not expect any State grants other than what has been awarded, as the State budget is limited.
Council Member Gardener commented that the sales tax dollars received by the City come from the private sector and it hasn't been a good year for many businesses due to Sept. 11.
Mayor McArthur commented that everyone wants to receive something and changes are viewed as a taking something away.
The group discussed the philosophy of entitlements and how to make changes and cut backs.
City Manager Esplin commented the other caveat with the State financial condition is it does affect the sales tax revenue as 50% of the sales tax we receive is from the state level. That is why the estimates are conservative on the sales tax projections. The Class C funds are basically the gas taxes, projecting the same amount as we estimate for the current year. A certain percentage of the tax on liquor also comes back to the City.
City Manager Esplin explained the airport revenues are from leases and the City's share of the fuel tax. The Resource Officers are the monies billed to other communities. The Police Services are alarm charges and other types of sundry charges for police services. There is $300,000 for the City's percentage of 911 fees paid on telephone bills. The $200,000 in dispatch fees is a new source of revenue. In past dispatch fees have been charged based on the number of calls each community had during the year, including the County. The new plan has the charge based on the population of each community in the County. An interlocal agreement is being circulated and should be signed by all parties by July 1, 2002.
City Attorney Wright indicated the County has agreed to sign it.
City Manager Esplin explained the Planning fees are the variances and zone change charges. The Recreation fees of $300,000 include softball and soccer fees. He commented the swimming pool continues to loose money. He has sent a letter to Santa Clara City indicating they need to pay for their portion of the maintenance on the Sand Hollow Aquatic Center (SHAC) for this year and past years or their residents will be charged an additional fee. He explained the cities of Santa Clara and Ivins each paid 7% to build facilities. The first year the City of St. George paid for all the maintenance. The second year Ivins paid for their portion of the maintenance and Santa Clara City paid ? of the amount due for their share of the maintenance. Currently Santa Clara City owes $19,000 in maintenance fees. In discussions with Santa Clara City, their staff indicated the rates for the Aquatic Center should be raised. That was done last year and attendance dropped. The rates are as high as the market will bear. In the letter sent, Mr. Esplin gave Santa Clara City the option to charge their citizens $2 more per person to cover the maintenance fees.
City Manager Esplin discussed SHAC CO/Gen plant project and explained it is in the Power Department budget for the upcoming year, but it is uncertain if it will be done.
The group discussed what the fees recreation currently charged cover. They pay for the cost of the operations not for staff salary and benefits. The SHAC is like the parks and the regular swimming pool; certain facilities don't pay for themselves but are an important part of the community.
City Manager Esplin continued with the explanation of revenues. There are no changes in irrigation and cemetery fees. The court fines are up a little bit. Other revenues are from First Night, the Marathon and the Arts Festival. He noted interest income is down significantly. The transfers from other funds are charges made to other enterprise funds to cover costs of operations, collecting, billing and overhead. The total amount of revenue is projected to be $27,000,030. He cautioned the City Council not to spend the projected 2% increase in sales tax revenue until we have a better idea whether those increase will actually occur.
Mayor McArthur commented the basic difference between 2002 and 2003 FY is the way the airport fund is handled.
City Manger Esplin agreed. He reviewed expenses and provided an overview of General Government expenditures. There is no real change in General Government other than one new person in Administrative Services. A new position of a Webmaster is going to be created. He explained currently staff is trying to keep the web page up with 2 part time people. The proposal is to hire a full time Webmaster and eliminate the two part time positions.
Mayor McArthur commented the web page is a necessary part of doing business.
Council Member Orton asked if there have comments from citizens?
City Manager Esplin indicated that citizens and City employees have commented on the web page and that it doesn't function well. He estimates the salary of the Webmaster will be about $40,000.
Mayor McArthur asked if that Webmaster would be involved in developing a way for people to follow status of the permits online?
City Manager Esplin explained the Building Department would get the program operating and the Webmaster would get the program working on the web page. He indicated the web page could be expanded and utilized more effectively if there was a Webmaster on staff. He explained there is nothing new in the Finance, Legal Services or City Buildings budgets. The integration of new Dixie Center people is new. The Building Maintenance department has asked for a couple of people for help in maintaining the buildings, however, he thinks some of the employees at the Dixie Center can help with that. Due to airport safety issues the Public Safety Department has hired 2 new people. It is anticipated about 6 months worth of federal funds will help with those costs. There will be overtime funds in budget to cover all of the shifts required for security. In 6 months the federal government will take over the security operations at the airport and the 2 new employees will be integrated into the police department. He explained the Drug Task Force received some monies through Senator Bennett's office. The Police Dispatch is a new account. All of the dispatch finances have been removed from the police budget and will now be billed off of the dispatch account. This is so the other entities will be able to review the account information if they choose to.
City Manager Esplin explained the Fire Department asked for 8 new full time people to staff a new fire house on the west side of town and 20 new volunteers for various stations. He indicated he approved1 new fulltime position and 15 new volunteers. He told the Chief as long as there are people willing to volunteer; the City needs to let them because it keeps the community spirit going. The new fulltime position will be an Administrative Captain in charge of training. He explained the ride along program, which pays for volunteers to fill in for sifts when the full time personnel is short, has been very successful.
Council Member Orton asked if there are adequate numbers of people on the volunteer list waiting line. Does the City maintain its fire rating status with this approach?
City Manger Esplin indicated the insurance fire rating status has gone down, which is good. The department does get deductions on some things, such as not having the amount of ladder trucks recommended. He explained the only station that has a problem is the downtown one. There are no residences in that area so there are only 2 or 3 people that respond from that station.
Council Member Orton asked if that is taken into consideration when adding volunteers?
City Manager Esplin indicated it is. There are approximately 10 volunteers for each station.
Mayor McArthur indicated there is a bill in the legislature to make anything that happens health wise after a fireman retires considered as work related. All incidents would fall under workers compensation, which could significantly affect workers compensation.
City Manager Esplin explained those involved in the fire business have established a standard mandating the number of people in the vehicle before it can respond to a call. If the vehicle leaves and there is a problem, that standard will be used if it goes to court. He indicated the City has bypassed the regulation in the past because the fire department is part volunteer. The fire unions are primarily the group behind this issue because of job security. The fire department is proposing a new building in the Dixie Downs area and a new fire truck. Part of the new building will be a communications center. It will be a shell that won't be equipped right now. This would be a back up communications facility.
Council Member Whatcott noted the personnel number in the Community Development Department went down. He asked if that is because Joe Empy has not been replaced?
City Manager Esplin indicated it is an error as the position is being advertised at this time. The airport manager in the past has been part of the Community Development budget. The new airport manager will be part of the Public Works Department. The new airport manager will be on board June 3, 2002. He is from Cody Wyoming, has a degree in aeronautics from Denver and worked at the Denver Airport for a while. Jack Jeppson, the current manager, has been told he will move back into the building inspector position. Mr. Jeppson didn't meet the minimums requirements established for the position.
Council Member Allen asked about the status Shanna Buehler.
City Manger Esplin indicated Ms. Buehler has done a really good job. However, her husband is in bad health and she needs care for him. The City would like to keep her, so the department is considering hiring 2 part time people do fill in while Ms. Buehler's husband is ill so she can return to her job at a later date.
City Manger Esplin explained the only new position in the Public Works Department is the new airport manager, which is now a full time position in that department. He is hoping the new airport manager will be able to take over some of the work done by the consultant. That would reduce consulting costs, which are about $240 per hour. The federal government is paying 90% of the consultant's fees, but Mr. Bullock has been told that the consultant should be used less.
City Manager Esplin indicated in the Leisure Services Department budget there are 2 new positions for the Parks Department. The City has taken on several new parks and trails that have necessitated the need for the new positions. Parks Superintendent Scott has documented the cost to maintain common landscape areas on 66' wide streets at $9,000 per lot for 50 years of maintenance. Mr. Esplin suggested homeowner associations maintain right of ways as the City can't afford the maintenance costs. A new division called the Marathon has been created to better determine the cost of running the event.
Council Member Allen suggested getting a volunteer program going to maintain the landscape areas on the 66' wide streets. It may turn into something competitive which will keep the landscaping looking very good.
Mayor McArthur asked if the City has refinanced everything possible at the lower rates.
City Manager Esplin indicated everything but the golf course debt has been refinanced. The golf course debt refinancing would result in approximately $15,000 annual savings on a $4 million note. The short-term interest rates are good, but long-term rates are not as low.
The group discussed the golf course debt, the payment and note amounts as well as when the notes would be paid in full.
City Manager Esplin reviewed the enterprise funds. The Water Department has a $42 million dollar budget; revenues are primarily from $30million in bond proceeds. The capital improvement projects are new wells, a regional pipeline from the Sand Hollow Reservoir, and a pipeline in the Snow Canyon well field to handle the additional wells that have been developed in the last couple of years. Also planned is the development of the Tolman wells and additional storage tanks.
Council Member Whatcott asked about the status of the regional Sand Hollow pipeline as far as support from the other communities.
City Manager Esplin explained the City of Ivins is committed to the project; he is not sure how strong the commitment is from Santa Clara City, as they haven't come up with any funds. The project is scheduled to be under construction this winter.
Council Member Gardner commented the arsenic regulations are taking a different flavor, he doesn't think the nation understands the impact of this ruling. He indicated the Tolman wells have almost no arsenic.
City Manager Esplin explained the staff has estimated the cost to treat the water for arsenic is .65 per 1000 gallons using current technology. He explained the request for an additional person in the Water Department. The position is for an engineer as suggested in the strategic plan done by RW Beck and the Water and Power Department staff. Superintendent Kell has done a good job and has worked well with rest of departments. The new engineer position would assist in planning and will work with Superintends Kell and Childers.
Council Member Gardner commented that one thing that came to light with the Kemp Study is that on Phillip Solomon's level, there is a need some more help.
City Manger Esplin commented that especially as the City goes forward with managing water additional staff might be needed. He explained the Waste Water Department is also requesting an additional position for a new operator. This is primarily a result of taking over maintenance of private systems in Planned Development Communities.
Council Member Allen asked what cost there is for these systems.
City Manager Esplin indicated it is about $30,000. He also explained there is a lot of employee turn over in that department, the operators go to other departments within the City because of the market and the way it is set up. The Waste Water employees are at the lower end of the pay scale.
The group discussed when wages are reviewed and data collected from other cities. The market adjustments were discussed as was the timing of pay raises and benefits packages.
City Manager Esplin indicated the health insurance premiums have been put out to bid and there will be 14.68% increase for this year. He is suggesting the City pick up 10% and employees pick up 4.68% of the increase. He also explained that over all utilization of health insurance is low, about 75% to 79% and there is still an increase. He is not sure what can be done; the national scene says it will be jumping in double digits for the next few years.
City Manager Esplin reviewed the Power Department budget. The department has asked for 2 new people, a Computer System Administrator (CSA) and a Resource Coordinator. These 2 positions are recommended in the strategic plan. He is not recommending hiring them currently. He discussed the changes in Power Generation Superintendent position. The position has been advertised as an Operations Engineer. Regarding the CSA, a City wide analysis is being done. Mark Mortensen has been asked to review this situation.
The group discussed the problems with decentralization of the computer system administration responsibilities as well as striving for uniformity with regard to software.
Council Member Allen asked if there a possibility the police department will be on the same system as the rest of the City.
City Manager Esplin explained that the nature of the police department system and how the department has to handle reporting prohibits it. He explained there has been discussion as to whether the patrolman that maintains the system should be a patrolman or a computer person.
The group discussed the financial reporting with regard to the power department. It was noted the purchases from UAMPS is significant, particularly at this time of year. It was discussed that when the monthly financials are prepared Phil Peterson has to estimate the UAMPS bill because it does not arrive until the third week of the following month.
City Manger Esplin indicated the Power Department is trying to sell what any power purchased on long term contracts that are more than what is needed to meet demand.
Council Member Orton commented the demand and resources should be reviewed and projections made monthly. He asked if the council is in a position to change rates quickly.
City Manger Esplin explained that hopefully revenues and expenses will level out over the year, he doesn't want to lower the rate in the spring and then raise it again in the summer when the demand is higher and power purchases are required.
Council Member Gardner commented that there is a very fine relationship between purchasing and pricing. Raising rates doesn't always solve the problem. He also indicated the effect of the UAMPS billing cycle on the monthly financials has been an ongoing discussion of the Water and Power Board. He indicated it is an issue that the board and the staff have not been able to get on top of.
City Manager Esplin reviewed the budget for the golf courses. The department had a great April and a steady May. Long term the golf course strategy is simple, the goal is to try and hold the system together until 2008. After 2008, the bonds will be paid and the golf courses should do better. The estimate is to have about $600,000 - $700,000 extra in the golf fund once the debt is paid. He explained Dave Terry has some ideas about pricing scenarios and trying to maximize funds. For 9 months of year there is ample space on the course. He commented consideration of what the market will bear with pricing has to be taken into account when setting green fees. He indicated it's not really what everyone thinks it is as far as making money in golf business.
Council Member Orton commented that the positive effect the golf courses have for economics in community is immeasurable.
City Manager Esplin indicated the more golf courses of quality for the winter season the better. But they have to be marketed and Dave Terry is working with other courses to market them better.
Council Member Whatcott commented that an article in Salt Lake Tribune newspaper indicated the number of golfers is stable while the number of courses has grown across the country. The marketers say the number of golfers hasn't increased because of prices and there are no public courses being built anymore.
City Manger Esplin pointed out that golf courses are part of the economic development. He said Dave Terry has pointed out the golf courses have a significant affect on the economy. He also commented that the Dixie Center is subsidized because of economic impact it has on community and the same could be true for the golf courses. Although he is not suggesting they be subsidized indefinitely, but the impact on community economics has to be considered. He explained a grant of about $17,000 in federal funds has been awarded to teach children how to play golf.
City Manager Esplin explained the building authority covers the debt services at Sunbrook Golf Course, the Police Building and the Opera House. He explained the Waste Water Treatment Department is looking at $2.3 million in costs for the first portion of the reuse plant. Currently, the department is trying to figure out what to do with all the water from the wastewater plant. They would like to put in Gunlock mix it and send it down the Santa Clara River. However, there is some question of people's willingness to ski and swim in reuse water. There has to be a place to store some of that water. Putting it in Gunlock will not be a permanent solution as 6 out of 10 year's excess water is spilled over at the Gunlock Reservoir. There is a site out by Ivins and Santa Clara cities. There is not enough capacity in golf course ponds to store the water.
The group discussed how water would get to the storage facilities and possible storage facilities. Also discussed was the right of Ivins and Santa Clara cities to access some of the water. The reuse pipeline to be constructed as a result of the Shivwits settlement would have to be sized to meet those access rights. The City will receive $16 million from federal government to build the plant and the line. There was discussion about the work being done at Sand Hollow Reservoir and if it was going to address any of the ground water recharge issues. Concerns of the water quality, particularly the salt levels were discussed as well as how the issue can be addressed when the Quail Creek Treatment Plant is expanded.
Gil Nichola addressed a question to the City Council. He indicated there will be an AOPC meeting in a couple of days. There are a couple of topics that the organization needs answered. He indicated in the January 2002 City Council meeting water rates were increased by 15% and the AOPC was told their concerns regarding paying higher rates than individual residential units would be addressed. He explained that it is almost to June and asked when new water rates will be instituted.
Mayor McArthur indicated the staff has reviewed the difference rates and determined it is about 10% higher for PUD's.
Gil Nicola explained that when the AOPC did their study the PUD's were using more water, since that time they have reduced water use. In his development, Santa Fe, they are paying about a 10% higher rate. He explained the AOPC is looking for new water rates and asked why is it delayed so long.
City Manager Esplin explained that Phil Peterson has pulled all the meters of PUD's and is trying to determine the effect of a rate change will have on the capital fund and total system revenues. Hopefully Mr. Peterson will have it done by July 1, 2002.
Council Member Whatcott commented he has had conversations with Phil Solomon and others regarding trying to determine what will be equitable. The cost to developers of PUD's was less because of the reduced cost of impact fees when fewer meters are installed. Hopefully the reduced cost was passed on to the home buyer. In looking at retrofitting each unit with a ?" meter, the home owner will have to pay impact fee for meter. It could take 35 years to recover the impact fee costs by paying less for water. Paying 10% more for water may be less expensive than paying for the meter. The premise was the contractor passed on the savings to the people who bought the homes in PUD's.
Council Member Orton asked why individual meters are not installed for everyone.
Council Member Gardner indicated one issue is the landscaping. People live in PUD's expect the landscaping to be taken care of. If individual meters are installed, the development may loose the continuity of the community.
Gil Nicola commented that the residents pay for the landscaping and the roads.
Council Member Gardner asked Mr. Nichola how would he suggest the water bills be individualized and maintain the continuity of the entire development. One person will water lawn and others won't.
The group discussed the Ridge situation, which has a loop system. Seven meters service 197 homes. The developer avoided some of the impact fee costs. It was discussed if those savings were passed onto the home buyer.
Gil Nicola commented whether the savings are passed onto the home buyer is the question. He indicated in the Water and Power Board meetings implementing surcharges are being discussed. How will that affect the PUD's? The AOPC requested a meeting with City Council about 5 months ago and hasn't heard when it is scheduled yet.
The issue was discussed further. It is a complicated issue without an easy solution and has been sent back to staff for options. The staff is working on this issue and other projects at the same time. The group discussed that some choices people make they have to live with. One problem is that some people don't understand what they are getting into when they buy into a PUD. The group discussed the impact to the City if individual meters are installed on all PUD's units.
City Manager Esplin explained he has asked for recommendations from staff and is hoping to have them in the next 30 to 60 days, but he can't guarantee it as there are other projects also being worked on, such as the issue of the sewer systems in PUD's. With regard to scheduling another meeting with the AOPC, he commented at the last public meeting with the organization, people were rude and inconsiderate. He indicated dialog is great, however when answers to questions or the City's side of the facts are treated with rudeness, there isn't a lot of encouragement to have more meetings until we have all the facts. He indicated it's been a difficult year, requiring a lot of time and effort to develop water and power solutions. He indicated the staff is working on it and will get to it as soon as possible.
Council Member Whatcott expressed the solution has to be revenue neutral. The only way to do that is to raise rates for the other 45,000 residents so the 5,000 residents in PUD's are satisfied.
Mayor McArthur indicated the staff and council are not trying to avoid the situation, but trying to get to it as soon as we can. Changes in the waste water system have been made. He also explained Homeowner Associations are outside our responsibilities as a governing authority.
Gil Nichola suggested the staff think in terms of breaking up the system rather than individual home meters if they are considering a surcharge for water use. That may be a more logical way to approach it.
The next work meeting will be Thursday May 23, 2002 at 4:00 p.m.
Council Member Whatcott made motion to Adjourn. Council Member Orton seconded the motion.
Council Member Gardner – aye
Council Member Whatcott – aye
Council Member Orton – aye
Council Member Allen – aye
Motion carried unanimously.
Meeting adjourned at 9:35 AM.
Minutes recorded by:
Ren? Fleming Deputy City Recorder Date