 Ladies and gentlemen, we can begin or it takes an already sit down I will call this special committee of them whole meeting to order Foreign Excuse both excuse Bowers. Yeah Decker excuse Hammond present Hannah Vitamin here Pat here Kibblesen is here Montemayor here Rene Flesch here Racler here Samson Vanderwheel here Versi here and one come in here Thank you, please rise for the Pledge of Allegiance like a legions to the flag of the United States of America and to the Republic for which it stands one nation under God Indivisible with liberty and justice for all I need approval of the previous minutes so move second Motion made Montemayors seconded by Hammond Prove the previous minutes all in favor say aye. Aye chair votes aye posed Motion carries now before we begin on the discussion on 2011 budgets the president had asked for a few minutes Thank You Chairman Just a brief message here Wanted to let everyone know council documents 1631 regarding cell phone usage during common council meetings was received by all of us The communication was referred to the committee of the whole for further discussion I guess I would like to say as a friendly reminder to everyone Please make sure that all electronic devices that you carry with you are turned off and out of sight During common council meetings As you already know cell phones and other electronic devices can cause unnecessary Distractions to those around us and I would ask out of courtesy and respect unless of course an emergency arises That you refrain from using these items during council meetings. Thank you so much for your consideration Thank You president kill some One idea would be a beginning of the council year to Enact the council policy of the Buckingham phone goes off for rings or vibes Buckingham at the end of the year Maybe we'll give a donation or or do something for nice for the sue or the mayor or something with that money But do try to refrain it's good In two hands, it's it's good The public knows that we're taking this seriously We're not distracted by outside addition and yet further item is if we're there's no way of knowing if we're texting for the All-Persons and if we are texting up for all the persons those texts become public records So it urge you not to do so just to keep that clean as well and again, there's no way of knowing So all right moving on discussion on the 2011 budget The reason why I wanted to have this meeting today I did invite all the department heads as the Wells the mayor and public to attend On the state level when especially when it comes down to budget time the two parties meet as a caucus to kind of describe You know throw out ideas figure out what what the plan of attack was going to be We obviously don't have two parties here We have one party and then we're the party the taxpayer elected represent them the other differences that unlike the caucuses in Madison We have to be in public so a little bit different here. I hopefully though that we all feel comfortable enough with each other to Here's some ideas Toss them around to bait them. I don't you know, we cannot take any action this evening There's no document in front of us. It is simply an informational question answer If you'd like to ask a question of the department head, please, you know signal, which one we'll call them up And hopefully we can kind of get some ideas out here The budget as presented by the mayor is the acting documents So we're just help simply having discussion on that document any changes that that would have to be done on the after the public hearing on the 22nd 24th and finally the 29th Are the meetings that we have at least scheduled at least unless we have a budget done before that So again, I urge you to listen to ideas throw some things out there ask things like what would happen if we did this Who would be affected if we did this that kind of thing? So this meeting could be five minutes. It could be three hours It's up to you and how much information you would like to do And would anybody like to begin? All of them and Thank you very much, mr. Chairman As informal you may sit in this session. Yes, I got a stick because I got a hand something out. So very good Thank you. I don't have a helper If you'll indulge me, I'm gonna hand this out in order to kind of expediate We when I say we Finance office the mayor's office And myself have been working to look at different options and I think we came up with What we feel is a pretty good solution To this sure we should have enough extra for Mike and Bob to Have one as well. If there's any left feel free to send them backwards if we took a look at the Top portion again, you see the original proposed reductions the revised reductions and Then what you have so for example police department original reductions are 441 We're looking at basically a $213,000 Amount that we would need to keep the police officers on the force same thing with fire public work So on and so forth and the funding for the SCEDC So what we're looking at is a million-dollar deficit million-plus Leaving the tax rate the same as it is $8.35 versus the Loring or what the came back in at this year of $8.27 Would free up about 200,000 The public works our partners in the labor union have agreed to on there It says no raise but essentially they're going to decrease or increase their contribution to the medical And that'll be about a hundred and thirty and then four full-time people Through retirement would would come off the books. That's four hundred and thirty-four The Contingency we have a contingency in there Taking that out of about a hundred thousand the city development manager From one of the all Paulette's old position Not funding that would stay in the table of organization, but wouldn't be funded for 2011 The administration the motor vehicle fund when looking at that Taking about a hundred and twenty five thousand out of that We looked at how much time our city Employees finance purchasing HR the attorney's office is spending and There just wasn't it wasn't accounting for all the time So that would be a hundred and twenty five thousand and then from Capitol Park improvements Again through the capital improvements budget, there's going to be a significant amount put into our parks this year So that gives us a total of one 1.9 million 19,000 solves a gap keeps the firefighters keeps the individuals in the TPW and also funds the police department and I guess I would entertain any questions. I don't know Just receive that anybody have questions or comments on the while you've seen so far One question. Yeah, good Just looking at the taking the hundred thousand from the contingency. I know we're looking at I Guess a question I have is a reference to library Would this meet the satisfaction of the money they need or would? This doesn't do anything with the library It's gonna primarily deal with the police fire and DPW. Okay, I think you know as the resolution that we put forth on Monday I think we may want to wait until the Attorney General responds To our request To find out whether we meet maintenance of effort because depending on how that comes back we may be meeting So we know that we're gonna get an answer from the Attorney General by money Don't know for sure, but I would suspect in an issue like this We've probably and if we don't then we'll have to deal with it then but the letter has been drafted Or in the process of being drafted and it'll be sent out I can't guarantee obviously as as the Attorney McLean mentioned on Monday, but I would suspect with an issue like this that we'd hopefully But until we know for sure Whether there did not answer or not so then With this as it stands the library is out of its Separate issue. We did not increase any funding for the library over the over the From the from the budget as proposed right to us Which would be the 300,000 cut 294 294 And that would be a question if you're looking at finding a way to establish that that obviously whatever You know, we had back in there has to come from somewhere So again, that's why we have discussion points here now making coming to a solution today at least how long I'm in Thank You. Mr. Chairman I for one could not support a budget that Does not fund the library to the maintenance of effort I mean, I really think there's got to be some way we can come up with this And I guess I'm gonna ask a what if question what if we don't get an answer back from there Have you got plan B? No You know the library is the cornerstone of our of our educational system and for less than $3,000 not to fund it is absolutely ludicrous. I mean, I can't imagine this the to clarify Yeah, I would like to 300 that the three thousand or so the two thousand and forty would be an increase from the current year's budget Which means we actually have to find Just under three hundred thousand. We have to find two hundred ninety seven thousand eight hundred and forty five dollars But we go through this every year with the library and you know Let's face it education is prime these days it's Foreign countries such as the Asian countries are outstripping us left and right all over the place and We can't afford not to do this. I mean to do it. This would make no sense whatsoever It's one of the most important things that we can do What's more important than education and the library is the main repository of education in Sheboygan County I was just telling Alderman bowers I can remember years ago and an alderman made a remark and said why does the library have to buy new books every year? Don't they have enough? I mean that shows a complete lack of understanding of how to live how important it is and I'm afraid that some people have that kind of an attitude and You know, I find it reprehensible. I really think that this is primary in our Duties as an order minutes to fund the library to the necessary extent And just to clarify the plan here was simply brought forth by one particular older person who did you worked with? Does that just on your own? No, I was in conjunction with the finance department in the mayor's office finance department The mayor's office is just one plan. We're not voting on accepting this or not if you desire to You know look for increasing the funding refining the just under to 300,000, you know, that's that's up for discussion You know, and I guess the question then are you looking for the tax levy hike or what are you looking for for that aspect? So that's under discussion. Helen Bowers you're next Yes, I have a question regarding the Budget insurance seems to be a two million dollar increase in claims. I've been trying to investigate this and I've talked to our Two of the three attorneys that I know we have on a retainer I've been able to get an answer why our Reserves are up or our claims are up and I believe I don't I don't think this is in health insurance I think this is in other insurance could someone explain the two million dollar increase Dr. Modio you have that information would like to respond If you would please the mic because we're on televised so thank you This year when we went out for insurance quotes We got a quote and we picked um R And um R is just a claims processor if you will an administrator But the value of the claims that the city pays is Based on the claims submitted by the employees who use that service Based on our experience to date Which was for the past 12 months They do an actuarial comp Compilation and come up with a minimum claim value and a maximum claim value Based on the exposure we used as a as a city over the past 12 months The minimum value was 7.4 million I believe and the maximum value was 8.5 million in the past The reserves required To keep Into the the fund excuse me should be at a 25 to 30 percent level which Basically funds about 90 days worth of claims so for example If we were a business or if the city went out of business Whatever claims that were in process Normally take 90 days to bring to fruition and get paid so the reserve balance we need to keep is roughly 90 days worth or 25 percent of the claims value In the past the claims Value reserve has been used for other purposes the fund balance As of the end of 2009 was roughly a million dollars on seven and a half million dollars of claims So if you do the math, it says we were short six or seven hundred thousand dollars It was the city's position that we fund to the maximum level In an effort to increase the fund balance so that we would have a minimum of 90 days claims payable on hand It doesn't mean that we're going to get eight and a half million dollars worth of claims Hopefully maybe seven point eight or seven point nine and we'd have the ability to keep six hundred thousand dollars in the reserve balance That's what we used Talking about health health claims or medical health. Yes. I'm not talking health. I'm talking in the next page What page is that? Claims 54 0205 claims three million 686 Okay Right these go to five point six right. This is what the city pays the balance is paid through paid to employee contributions This isn't health insurance. Oh, this is something else. I know this would be difficult Director Amodio, I'm sorry, I know it'd be difficult especially on reaching the mic in the book here Just if you give us direction of where we're at right here is a hill on page 99. This is the revenue on 704 It's the health insurance fund. This is Particularly looking at object number or general ledger number 540 205 This is this is Yeah, this is how we okay estimate how we pay for the claim. Yeah, and then on the second page Expenses that equal the revenues So the claims are up to two million down the reserves, but no not the reserve the estimate for claims paid We've got stop loss And we've got actually prescription drugs right which is added to that for a total of seven right And these are the administrative fees that we pay There's retiree claims that are not in these these are active employees. These are retirees These are the prescriptions for the retirees And these are the Claims for retirees with Medicare, okay Here and these are these are actually people in the city that are on Cobra. Yep, which means they pay for their own premiums But of course, okay, so this over here is But we're paying we estimate what the premium is going to be. Yes. All right So this should add up to all this, right? Okay, that's a 12.5. I see that okay now I guess what I Questions I have on the city's other insurance, which is liability and autumn and I Have been able to find out how much we're paying out in claims each year These are the three law firms. I've been able to find out that has represented us in the past year Conways a local one is for This one is Rosenberg I believe that's an out-of-town firm too. Okay, so the deductible was four hundred thousand dollars Okay, claims charged to the department has been the same 2010 and 2011 correct. Okay, so actually we're reserving or setting aside the same amount of money. Yes, so did we pay out this last year? 400,000 I'd have to look I don't know that off the top. Okay Because it would seem to me if we didn't pay out to 400,000 and we could take that 400,000 off and put it in here Yeah, true let's say we paid three hundred thousand last year that would leave us a hundred thousand here So we wouldn't have to allocate 400,000 this year right we wouldn't have allocated the same if it was less So we did pay out this last year. I'll have to find that out for sure. Okay. I don't know off the top and in our premium I guess this is a premium for automobile and probably a public official bond 130,000 yep each year. That's not a premium and that that's More or less the premium we pay. That's the premium we pay for all of these cities Okay, so I guess what we're looking at here is to see if we paid out 400,000 last year if we didn't it we could add some of that or take it off this year right huh? Yeah, all right Could you do that for me? Absolutely. All right. Thank you If you would for the sake of the microphone people at home give a review of what you two gentlemen had discussed Yeah, and we can hear the immediate area, but people at home Yes, what we were going through was liability insurance And there's a portion in the liability insurance that is for for deductibles and if we didn't pay out the deductible amount that we had budgeted We'll look at that to see if there's anything we can do to reduce that cost in the liability insurance fund All the racer if you just want to have one second chairman's of one other follow-up for you First of all, I'd like to thank Alderman Hannah and others who put the document together. I think it's great work. Oh Sorry, Hammond. I actually make the same mistake. We're gonna call it consiglary from now on Thank you for the work you put I think it's a great starting point and hopefully a lot of Conversation can be generated Monday and next Wednesday, I guess one of my final comments for for this part of it And I'll leave it lately for tonight is on the library I guess I just want to warn everybody that I will probably try to introduce Taking the money from the contingency the additional and adding it on there For the library for the 294 300 whatever just to edit on so I guess I want everybody to know that I'm going to do that so that they can think about it That's something that they want to support and I guess in repaying that money I kind of follow back up on what Alderman Bauer said is at the end of 2010 There is hopefully going to be some additional money that will be out there. I'm hoping for things that bills that are Didn't meet the total amount that we thought they would you mean as far as budget versus actual for 2010, right? Right, I'm hoping and maybe from that we can take that money put it back into the contingency I think what we go anyway and replenish the money of the Money that we're spending so I don't know if that's a viable option or if that's gonna You know, I thought normally normally when we fund and we fund the library funded from taxes. Yeah I'm just looking at making the motion to from the contingency fund and then Hoping that the money that's left over from the I don't want to carry over if the right word But money that's not spent from 2010 would then be able to go back in the contingency to cover Maybe all of the $400,000 that we would use maybe I don't know. I guess we have to see how much is there I just wanted to make sure that everybody was warned Okay, we're talking about the contingency fund one of the members of the public had Actually know the representative of the ASME had talked about you know lowering the amount that we have in the contingency fund correct I had a While back understood that we really couldn't go below. We had in terms of the bond rating agencies Can you speak to that a little bit? Yeah at the end of 2009? We had in about 11 million 11.8 million dollars in the general fund balance all but three point eight of that Was designated if you will three point eight million was undesignated And going back and looking Through the documents in 2005 There was a resolution passed by the council that said that we should reserve or designate four million dollars of The general fund balance for working capital For the first few months of the new year in addition it also said that We should look at the prior years fund balance and spending in any amount that we were overspent to the prior year We should increase that Designated reserve of four million dollars by that same percentage We have not done that As a practice When we go back and look at it it would take that four million dollars to about four point five million dollars Because spending since 2005 in the general fund has increased significantly So it said it would leave us roughly 3.3 million dollars In the general fund as undesignated reserves as we know it at the end of 2009 And that would put us at about 26 or 27 percent Ailers who represents us in bond offerings and represents us with Moody's Said the average that they use as a general fund reserve that doesn't get questioned by Moody's is 25 percent So if we look we got a couple percentage points on three three point three million dollars It's worth some money But certainly not one point seven or two million dollars if that answers the question I'll go through next. Thank you chairman It was my understanding that we were short one point seven million with the library money. Is there that's not correct So it was we were short two million dollars. Yes Okay, so is there anything the one point seven million dollars was the general fund Deficit the three hundred thousand dollars was the Meade library fund deficit No Hammond I just wanted to kind of follow up on director of Moody O's comment First off, I think we it's it's not a contingency fund. It's a the general fund balance. It's the checkbook It's it's not as a contingency fund and secondly when we went through the bond rating You know there are many factors working against us right now for fortunately We've been able to keep our bond rating where it's at but there are factors that are working against us You know our the median household income is low Or lower than it's been obviously the job losses and all those types of things impact that so It would be easy to say take it out of the fund balance But that's going to cause us to have a higher cost to possibly have a higher cost of borrowing in the future Which you know what could I end up costing us even more than you know, whatever the hundred thousand that we pull out of it So I think we just need to get I understand There's a lot of passion on both sides of that But we also need to look at what's best for the long-term viability of what we're trying to accomplish So I guess I would just caution people when they're looking at using this three point three million dollars as a slush fund There's more to more tied into it than just a three point three million dollar checkbook. Yeah, there's some new legislation That's out to that changes in Government accounting standards. It's called Gatsby 54 that went into effect in 2009. It's effective for cities As of June 2011 and what it really does is it takes a look at the general fund specifically? Reserve balance and then breaks it out into four categories versus the two we know today, which is designated and undesignated funds For special purpose. What it also is doing is look at special revenue funds And see if the special revenue funds really qualify to the new standard definition Which says that those funds are set up for specific purposes There are specific streams of revenue that flow into that that support the majority of the expenditures out of those special revenue funds And when you look at the city's books, we've probably got 10 or 11 special revenue funds And there might be several that come close to not qualifying and could end up into the general fund An example would be ambulance fund Not using that because it's been a topic of conversation But that might be one that we set up to separately track Ambulance revenue and cost, but it really doesn't it may not really qualify as a special revenue fund under the new definition of the law So that might be something that ends back up into the general fund So we've got things like that going on as well that may take some of that 3.3 million and Reclassified into another category That is not for use Very good. Are there any other questions or comments this time? other than Bowers I See another one here and contracted services under insurance $40,000 now is that for administration costs or is that for Paying to lawyers that outside the lawyers fees Tom, you know what that contracted services under under that Okay, could you check that out? Okay, get back to us on Monday on these issues. Absolutely. Okay Anybody else today? We do have all the department heads here. Anybody like to ask any questions specific to them? All right, thus far we've had a plan presented to us One that will be officially presented on Monday Submitted to the council We've heard comments regarding funding the library and a plan for perhaps using reserve funds for that as well Things to think about on ourselves before we come back and actually make official motions on that There are ideas or thoughts at this time. I need a motion to adjourn Don't move second motion made in second to adjourn all in favor say aye Chair votes aye opposed motion carries. Thank you all for coming. We're done