REGULAR MEETING OF THE COUNCIL OF THE CITY OF NOVI
THURSDAY, APRIL 23, 1998 AT 7:30 P.M.
NOVI CIVIC CENTER - ACTIVITIES ROOM - 45175 WEST TEN MILE ROAD
Mayor McLallen called the meeting to order at 7:40 p.m.
ROLL CALL: Mayor McLallen, Mayor ProTem Crawford, Council Members DeRoche, Kramer, Lorenzo, Mutch, Schmid
AUDIENCE PARTICIPATION - None
APPROVAL OF AGENDA
Mr. Kriewall requested that they add Information Technology, Finance Department and Treasury Department as Item I under Balance of Funds. Further, Mr. Kriewall requested that they add Staff Planner Budget Amendment as Item J under Balance of Funds.
CM-98-04-121: Moved by Crawford, Seconded by DeRoche, CARRIED UNANIMOUSLY: To approve Agenda as amended
Vote on CM-98-04-121: Yeas: McLallen, Crawford, DeRoche, Kramer, Lorenzo, Mutch, Schmid
PURPOSE OF MEETING - 1998-99 Budget Study Session
PROPOSED BUDGET REVIEW: White Yellow
1. Library - Page (½ hour) 138 n/a
Mayor McLallen asked Mr. Kriewall to explain the relationship between the Library and the city. Based upon the city attorney’s opinion, Mr. Kriewall understands Council appoints the Library Board members. He further understands the expenditures are their own ordinance and that Council only has jurisdiction on the amount of millage levied (1 mil by Charter). Mr. Kriewall further believes they have been levying at their maximum; John Chambers of the Library Board agreed.
Mr. Chambers reported there are increases in the proposed budget for salaries and benefits, and part of that is based upon the American Compensation Association’s study. He reminded Council that they hired Plante & Moran a couple of years ago to reevaluate the library personnel, their positions and their compensation. He then advised that based on that study they put formulated a range and that the Library Board then updates the ranges annually.
Mr. Chambers reported they are currently considering hiring additional part-time staff because they are extremely busy; especially on weekends. Further, Mr. Chambers noted their Fund Balance is somewhat higher than what they would like to have and he believes they will lower it by the end of the year.
Mayor McLallen wondered why they were keeping a 12% reserve. Mr. Chambers knows that amount can vary depending upon the circumstances. However, he added that they have reserved $100,000.00 for roof repairs and reminded Council that the building is twenty two years old. Therefore, they are trying to prepare for any major repairs that may occur.
Mr. Chambers then reminded Council about the study conducted by Wayne State University regarding the type of clientele the library services. Mr. Chambers also provided a copy of a study (Library Space Needs by Anders C. Dahlgren) that the library commissioned to address their space needs. Mr. Chambers summarized the recommendations cited in the report that addressed those issues the library must address so they can adequately meet the community’s needs.
Mayor McLallen reminded Mr. Chambers that the library is governed by a charter millage and noted they are currently at the maximum of their charter millage. Therefore, the Mayor understands that a bond issue must accomplish any proposed improvements. Mayor McLallen asked if the Library Board has determined a target year for a bond proposal. Mr. Chambers replied although the board has targeted a variety of time frames, they need to have specific information before they can specify a target year. He added that the board also needs to know what time frames are involved in terms of moving forward with a bond or a millage. Mayor McLallen advised that information can be provided to the Library Board by the Clerk’s office and the bond attorney.
Mr. Chambers advised that the Library Board would provide more information in June so that Council and the Board can mutually agree on a time frame.
Councilman Schmid asked whether there is any funding provided for the library besides the millage? Mr. Chambers replied they receive state aid and funding from state penal fines
Councilman Schmid asked whether the library qualifies for funding from trusts or endowments, and so forth? Brenda Evans believes that could be a possibility in the future.
Councilman Schmid wondered whether there is a potential to develop trusts and so forth from a tax standpoint. He added that he does not believe it would take many to make a significant impact. Further, Councilman Schmid believes it is time to determine another way to provide funding besides tax dollars.
Councilman Schmid asked if the Library Board thought about having an investment fund? Mr. Chambers replied that issue is raised when they talk about Fund Balance and is more of an accounting issue.
Mr. Chambers added the Library Director has applied for various grants and they have received some funding from that.
Councilwoman Mutch believes it is important for Council to remember one advantage the library has is that they have their own identity and therefore, people do not necessarily perceive it as attached to the City of Novi. Consequently, she believes a millage request from the library can be successful in the same year that the city may have a millage request. Councilwoman Mutch added that the library offers services in terms of staff that bookstores and so forth cannot provide. Councilwoman Mutch then described the features of the Friends of the Library store located in the Northville Library.
2. Parks and Recreation - Page (½ hour) 131-135 27-32
Dan Davis advised that the Parks & Recreation Commission goes through a goal setting process and then proceeds into a process through the CIP plan. He then reported that the department’s administrative staff compiles their individual goals and objectives. Mr. Davis explained that each administrative staff member is responsible for providing goals and objectives, from which they develop their program budgets. Mr. Davis then summarized the 1998-99 Parks & Recreation Budget for Maintenance, Recreation, and Special Recreation (Senior Citizen program).
Councilman DeRoche asked whether Mr. Davis sees the senior program paying for itself without help from the General Fund? Mr. Davis replied he does not believe they will be increasing their subsidy for the senior program.
Councilwoman Lorenzo understands the department is proposing to expand the senior transportation service to Walled Lake; Mr. Davis agreed. Councilwoman Lorenzo would like to be certain that portion is fully funded by Walled Lake. Further, she wondered whether Walled Lake would pay the City of Novi for staff time for this program. Mr. Kriewall replied Walled Lake is expecting Novi to charge a premium for this service and added that municipalities are encouraged to share services because many communities cannot afford to provide their own. However, he added there should be some benefit provided to the community that provides the service.
Councilwoman Lorenzo is concerned with Objective A., Clearing the Wooded Area at Community Sports Park. Mr. Davis advised that objective describes an area near the front of the park where there was a lot of overgrowth because the house located there had been vacant for quite some time.
Councilwoman Lorenzo understands they cut down many trees along the right-of-way at the Community Sports Park. Mr. Davis replied they removed the trees along Eight Mile Road that created a sight distance problem. He added that they worked with the city forester who evaluated the trees to determine which trees they could remove.
Councilwoman Lorenzo believes parks and recreation is a basic service that a city should provide and she does not believe Novi spends enough money in developing its park land. Further, she is concerned that they are developing all of the parks in a piece meal fashion. Therefore, Councilwoman Lorenzo suggested that they free as many funds as possible in the General Fund to provide further park development. She explained she understands there is $70,000.00 in the tree fund and she would propose to eliminate the $10,000.00 from the General Fund for the Forestry Department for trees and dedicate a portion of it to the Sports Park to continue their landscaping efforts.
Councilwoman Lorenzo further suggested that they look at other funds so they can begin to provide other services. She added that she would like to try to find money for an additional restroom at Lakeshore Park, and would suggest for the next budget year that they split the cost between HCD and the General Fund. Councilwoman Lorenzo restated that she believes they should be in partnership with Parks and Recreation, and therefore, she will be looking more closely at the funding in the General Fund to try to start fully developing the parks.
Councilwoman Mutch asked whether Parks and Recreation plans to keep Lakeshore Park and the tree farm separate? Mr. Davis does not believe they must necessarily keep them separate. He explained their design shows a connection and a utilization of a continuation of Lakeshore Park.
Councilman Schmid understands that the golf course study will be completed by June or July and asked whether Parks and Recreation will come back before Council at that time? Mr. Davis agreed they would.
Councilman Schmid asked what equipment is currently housed in the Fuerst Barns? Mr. Davis understands the barns are still housing school district equipment and according to the agreement, they will continue to use them until the city needs them. Mr. Davis continued by stating that they are currently transporting a lot of equipment to Power Park and they are also storing equipment on the Police Department’s parking lot. Therefore, Mr. Davis believes they may possibly use the barns to store equipment.
Councilman Schmid asked how many Novi seniors actually participate in the senior program because he understands many outside seniors are using the program? Mr. Davis replied the outside seniors are usually previous Novi residents that have been a part of the program for years.
Councilman Kramer asked whether the Community Park capital outlay will complete the development of the park? Mr. Davis advised it would not and noted they have another $200,000.00 budgeted next year for its further development (i.e., landscaping, fencing the ball fields, perimeter sidewalks, etc.).
Councilman DeRoche would prefer that the Parks and Recreation Department make every effort to subsidize one program to another when possible. Mr. Davis advised that there are programs that generate revenue over and above their expenditures, and those monies then allow the department to provide other programs that do not generate money (i.e., Easter Egg Hunt).
Mayor McLallen asked whether they have explored the option of paid advertising on the ball field fencing? Mr. Davis replied they have talked about it, but it has a low priority at this point as far as fencing is concerned. He explained it has been their goal to get the fencing purchased with the idea of advertising paying for that capital outlay. However, he noted they need to find the time to solicit that type of option. He then added they have been successful with Coca-Cola who paid for new score boards last year. Further, AT&T‘s proposal to construct a cell tower at Power Park will also benefit the community and the department for some of the other needed improvements (i.e., fencing).
Because of the city’s strict sign regulations, Councilwoman Mutch would not fully support erecting signs without giving consideration to the city’s sign ordinance. Mr. Davis advised they would be sensitive to the city’s ordinances and added the signs would be seasonal.
Bob Pheiffer of the Parks & Recreation Commission advised that they do not sell advertising in the form of a sign. He explained companies will often sponsor the back of nets or pay for labels.
BREAK - 9:35 until 9:55
3. Building and Grounds - Page (¼ hour) 97-98 12
Mr. Davis reported the Building and Grounds budget includes the actual operation of the Civic Center complex. Mr. Davis noted they have budgeted approximately $150,000.00 for carpet and tile replacement throughout the building. He added they have also budgeted $110,000.00 for parking lot replacement at the Civic Center over the next couple of years. Mr. Davis advised $40,000.00 is budgeted for Capital Outlay of which $25,000.00 is set aside for building improvements for the Fuerst property.
Mayor ProTem Crawford asked if the condition of the parking lot is such that the city would be liable for accidents? Mr. Davis advised they are currently doing temporary repairs to take care of the kinds of conditions that may be liability issues. However, he added those repairs are not a long term solution to the problem.
Mayor ProTem Crawford asked whether they are going to wait until they have all of the funds to repair the parking lot at once or will sections be repaired one at a time. Mr. Kriewall replied the entire parking lot should be replaced all at once.
Councilwoman Mutch asked whether they have given any thought to expanding the parking lot? Mr. Kriewall replied that the size of the parking is adequate at this time.
Councilman Schmid believes the city needs to decide what they are going to do with the Fuerst property and he does not believe they should maintain it as part of the General Fund.
Councilwoman Mutch advised they cannot apply for funds to maintain the Fuerst site without first having some idea about how much the repairs and improvements will cost. She noted that Mr. Klaver is in the process of gathering those estimates, but he has other job responsibilities that take precedence over this assignment. Councilwoman Mutch added that she does not believe that they had any intention of letting the General Fund assume the costs for the restoration of this site.
Councilwoman Lorenzo agrees with Councilman Schmid’s comments and further, she believes this committee must become very aggressive. She then stated she is unable to commit to the committee in that way herself because of her commitment to Council. She further stated that she believes the committee needs to recruit interested volunteers who have the time and commitment to put forth the effort necessary to solicit funding for this restoration.
Mayor McLallen asked whether they have resolved the problems with the evening cleaning crew? Mr. Davis replied that is an ongoing issue and although it seems to have improved, they are currently working with Ms. Kalinovik on that issue.
Mayor ProTem Crawford asked if any thought has been given to have a cleaning crew during the hours when most of the activity in the building is taking place? Mr. Davis advised Mr. Valente and other part time staff is available during the day. However, he advised that the outside cleaning contract is strictly for an after hours, six days per week cleaning with the option for a seventh day based upon need.
During the next budget year, Mayor ProTem Crawford suggested that they may want to consider contracting someone from 3:00 p.m. until 11:00 p.m. to supplement the other cleaning. Mr. Davis believes they would have a better situation if they considered a part time city position for this responsibility.
4. Balance of Funds (1 hour)
Les Gibson advised the budget is set up in major categories and added that the Special Revenue Funds have their own revenue source that can only be used for a specific purpose. He added the other main captions are the General Fund, Debt Service, Capital and the Enterprise Funds.
A. Police and Fire 130 n/a
Mr. Gibson reported the Police and Fire Special Revenue Fund is a special property tax levy that they will be running at its maximum. Mr. Gibson advised that revenue covers the fire department’s heavy equipment replacement and added there is currently a reserve being carried for that. Mr. Gibson explained they are removing $390,000.00 from this fund and adding it to the General Fund to accomplish the replacement of the three medical units. Mr. Gibson advised that the balance is for personnel costs to increase road patrol personnel and fire protection officers. Mr. Gibson then advised that they capture the revenue and transfer it to the General Fund as it is used.
Councilman Schmid asked for further clarification about Revenue Sharing, Interest Investments and Appropriation of Fund Balance on Page 130. Mr. Gibson referred to the last section of that page where it analyzes the Fund Balance. He explained once they completed the audit last year they had $277,253.00 in Fund Balance and they estimated the current revenues at $2,531,950.00.
Councilman Schmid understands the Fund Balance is money turned back; Mr. Gibson replied it is money that they turned back and it is a part of that reserve being drawn down. He explained over the years they have built up a reserve to replace the three medical units this year and this effectively draws down that reserve. He added once they replace the medical units, the balance in that reserve will be $180,000.00. However, he noted a portion of additional millage that they levy next year will be added to that reserve.
Councilwoman Lorenzo understands there is a request for two additional police officers and that is the sole reason that they would have to increase the General Fund millage; Mr. Gibson replied that is the way they have identified it.
B. Debt 139-158 n/a
Mr. Gibson noted they have identified the capacity on Page 139.
Councilman Kramer understands they need to strategize over time to determine what is the city’s capacity for bonds and what programs should fit into the program.
Mayor McLallen understands that the city legally could become $107.0M more in debt; Mr. Gibson agreed.
Councilman Kramer suggested that the strategy should be to keep it level. Mr. Gibson agreed and added that the rating agencies believe the city is somewhat high in its per capita debt. He explained the operating millage for General Fund purposes is relatively low and therefore, they cannot fund much capital from it.
Councilwoman Mutch understands that the alternative would be that they would have a higher amount in the General Fund and less debt.
Mr. Gibson summarized the status of the remaining debt service funds.
C. Capital Projects 159-164 n/a
Mr. Gibson reported Capital Projects are primarily for bond proceeds. He then summarized the status of the various funding.
Mayor McLallen advised there is a Council consensus that there are no issues about Balance of Funds D-H and therefore, they will move forward to Item I.
D. Major Street 127 n/a
E. Local Street 128 n/a
F. Municipal 129 n/a
G. Drain Revenue 136 n/a
H. Drain Perpetual Maintenance 137 n/a
I. Information Technology, Finance 8
Department, Treasury Department
Mr. Kriewall advised they were able to hire someone for the Information Technology position and that person will start in approximately two weeks.
Mr. Gibson reviewed the 1998-99 Information Technology budget.
Mayor McLallen understands the new person has a Master’s Degree and she questioned the necessity to budget $2,400.00 in tuition. Mr. Gibson replied he will confirm that tomorrow and they will either remove half or all of that amount.
Mayor McLallen asked whether the amount for the salary, worker’s compensation and so forth for the two people in the department is a true number? Mr. Gibson stated it is somewhat high because they actually hired the new person for less ($5,000.00).
Mayor McLallen believes this is a department that they want to see succeed and therefore, if someone can make it work in a year, she would be willing to give the $5,000.00 back. However, she added that she does not believe the rest of the numbers in the budget make sense,
Mayor ProTem Crawford asked whether the revised numbers are close to what they think might be a good starting point for the new person; Mr. Gibson agreed.
Because they will not complete a full wrap up this evening, Councilman Kramer suggested that Mr. Gibson bring this back before Council.
Mr. Gibson summarized the Finance and Treasurer Department’s 1998-99 Budget.
J. Staff Planner Budget Amendment
Mr. Kriewall reported that Steve Rumple recently resigned and the options to filling his position are to advertise on the outside or to offer this position to Khanh Pham. Mr. Kriewall advised he supports offering this position to Mr. Pham.
Councilwoman Lorenzo is concerned about putting a nonprofessional in a professional position and noted that Mr. Pham’s background is not in planning. Further, she understands that the person recently hired in the department has a planning background and therefore, she would suggest offering the position to her.
Mr. Kriewall advised that he has discussed this with Mr. Wahl and it is their position that the new person is not ready for that position. He added that they feel Mr. Pham already understands the process.
Councilwoman Lorenzo suggested that if they raised the salary range that they would get a higher quality candidate.
Councilman DeRoche thinks good employees are extremely difficult to find and that any difference in what Mr. Pham makes now and what this position is paying would be easily used if they looked to the outside. He further believes it is Mr. Wahl’s responsibility to make these kinds of decisions.
Mayor ProTem Crawford is a firm believer of promoting from within if the employee is qualified and therefore, he will support the recommendation made by the administrative staff.
Councilwoman Mutch agrees that it might be an asset to have the degree, but she believes that education is not necessarily enough and that experience is equally important.
Mayor McLallen supports the proposal because she believes it is important to keep people that are knowledgeable in this department because of the great amount of turnover it has already experienced.
Councilwoman Mutch would suggest that they put Mr. Pham in this position temporarily at the proposed salary to give Administration the time to find an appropriate Staff Planner. She added that they should not change his title, but only his responsibilities and salary.
Councilman Kramer believes they are looking for a high quality replacement person with staff planning potential. He also suggested that they elevate Mr. Pham to fill that position and rearrange the responsibilities until they hire someone.
Mr. Kriewall believes they could consider that.
CM-98-04-122: Moved by DeRoche, Seconded by Crawford, CARRIED: To approve $1,343.00 budget amendment for Staff Planner position
Vote on CM-98-04-122: Yeas: McLallen, Crawford, DeRoche, Kramer, Mutch, Schmid
5. Preliminary Wrap-up (1 hour) - Wrap up scheduled for April 27, 1998
Councilman DeRoche advised he will not be present at the April 27, 1998 meeting.
Mayor McLallen requested that the Clerk confirm with the city attorney to determine whether Council must hold a separate session to review the compensation wages for the planning consultant.
There being no further business before City Council, the meeting was adjourned at 11:30 p.m.
Mayor City Clerk
Transcribed by Barbara Holmes
Date Approved: May 4, 1998