President of Council Marjorie Harlow called Council to order on December 21, 2011 , at
The governmental body and those in attendance recited the pledge of allegiance. Mrs. McNear gave the invocation.
Mrs. McNear took roll call. Present were Council members Diehl, Emerson, Hawkins, Knox,
Squires, Vanover and Harlow.
The minutes of December 7, 2011 were approved with seven affirmative votes with a couple of corrections. Mrs. McNear stated it should show Mr. Knox in attendance, not Mr. Galster. Mr. Vanover took roll call. On page 9067, last paragraph ala, should be a- la. Mr. Knox said on page 9064 it says Mr. Vanover nominated Mr. Diehl but it doesnt say for what.
COMMITTEE AND OFFICIAL REPORTS
Civil Service Commission - no report
Rules and Laws - no report
Finance Committee Mr. Diehl stated that the Finance Committee met December 8 and reviewed the budget which will be reviewed tonight.
Planning Commission - Mr. Vanover reported that Mr. Darby was re-elected as chair; Dave Okum as vice-chair and Carolyn Ghantous, liaison to BZA. The Cincy Mattress sign, 11750 Commons was approved to be over the beam. Hobby Lobby was tabled, and the final PUD plan for the outdoor device was tabled.
Board of Zoning Appeals Mr. Hawkins reported Robert Weidlich was elected chair, William Reichert, vice-chair and Jane Huber, secretary. The owner of 1053 East Crescentville Road requested a variance for the elimination of a garage. That variance was granted with an additional condition that they must maintain an operational garage door and operational door from the garage to the house.
Board of Health Mr. Squires stated the food license fee license regulation was passed. CDC has confirmed three cases of a new flu virus but it is not a concern at this time. The Health Department has given 208 flu vaccines and Maple Knoll gave 127 at our flu clinic. There are 70 plus doses left for anyone who may need to get a flu shot. The Healthy U Diabetes Workshop will be offered in February and March 2012. A restricted species proposed framework came from the Governors office to address the ownership of dangerous wild animals in Ohio.
O-K-I - no report
Mayors Report Mayor Webster said Id like to talk a little bit about the SOS Christmas program this year. Normally we end up serving 40-44 families. This year it ballooned up to 61 families including 145 children needing assistance. Its a project thats growing by leaps and bounds to the point that its almost outstripping our resources. Although weve had a lot of donors, a lot of businesses came through with product or financial consideration and they are still coming in. Its not too late. Any money that comes in will be used to replenish our Christmas fund. Thank you to all the people who did the shopping, wrapping, delivering of presents and food that was donated. Theres no doubt in my mind that the sixty-one families will be positively affected this Sunday as a result of the efforts of the volunteers.
Clerk of Council/Finance Director Mrs. McNear asked Jeff Williams to come to the podium. She said I received a letter of commendation for Mr. Williams from the Government Finance Officers Association stating we are pleased to notify you that your Comprehensive Annual Financial Report for the fiscal year ending December 31, 2010 qualifies for Certificate of Achievement for Excellence in Financial Reporting. The Certificate of Achievement is the highest form of recognition in governmental accounting and financial reporting and its attainment represents a significant accomplishment by a government and its management. There will be an achievement plaque sent to Mr. Williams. When you go into the Administrative office there are ten plaques on the wall attributed to this award Mr. Williams has consistently won. Thank you for all your efforts, Mr. Williams.
Mrs. McNear stated we have been working on the budget for some time, going over it with a fine tooth comb. Its an excellent budget, the best weve ever seen. I ask your indulgence and approval for the budget this evening.
Administrators Report Mr. Parham said Christmas and New Years Day are on Sunday this year so the recognition for the holidays will be Monday, December 26 and Monday, January 2.
Law Directors Report - no report
Engineers Report Mr. Shvegzda said the SR 747/I-275 ramp modification that will provide two turn lanes from northbound SR747 to westbound I-275 is scheduled for a bid opening March 8, 2012. Preliminary work for the Beaver Run Creek Riparian restoration project is scheduled to begin this week, but the major bank grading work will begin early January 2012. We are working with the businesses and Vineyard Church in regards to a traffic plan for the upgrade of Century Circle North. That project is scheduled for mid May with completion in late August. The signal system upgrade had gotten underway and has been concluded until the holiday season is over and they can more realistically block lanes to complete their work.
Mrs. McNear said I have two items. They are the certificates of results of the election of the issues we had for the electric and natural gas.
COMMUNICATIONS FROM THE AUDIENCE
Grover Davis, 1090 Fallstone, shared his concern that he got his local newsletter December 13 stating that the aggregation public hearing would be held December 7th.
Mrs. Harlow said thats why we moved it. We are required by law to have two meetings so we will have one this evening and then the second on January 4. We apologize for that.
How would I know if I wasnt at the meeting tonight?
Mrs. Harlow replied it would be in the Community Press and on our website. Is that correct, Mr. Parham?
Mr. Parham stated unfortunately when we placed the ad for the December 7 meeting with the Tri-County Press, it was not published by the paper. So we needed to re-schedule the hearings and advertise for tonights meeting, December 21 as well as January 4 because we are required to have two public hearings. Are you referencing the city-wide newsletter that had December 7 in it? Mrs. Harlow replied yes.
Mr. Parham said I had that comment from one or two other residents. Internally we need to make sure that that document hits the date it would be effective for you so well take a look at what happened in this particular case and we apologize for the residents not receiving the document until after the particular date.
Mr. Grover said my concern is how we are going to come to these things if this is the only way we are going to be notified and were not notified and cant make it. Mr. Grover asked do we opt out if we dont want to be part of the aggregate?
Mrs. Harlow responded yes. We are going to have a presentation during our public hearing which is next on our agenda and Mr. Parham will explain why we are entering into this aggregation and we have some representatives from Eagle Energy who will do a presentation. Then well have an open discussion and you will have an opportunity to come back to the podium and ask questions of the Administration and Eagle and to voice any concerns you may have.
Mr. Davis said I will wait as I have some more questions.
Mrs. Harlow stated I also received my City newsletter late and we certainly hope to have that remedied as well.
Mr. Knox said we also received ours late and I called the young lady here at the City who handles that. They were supposedly mailed on November 27 or November 29 and she is looking at what the delay was. Really the City did everything on time and somebody else dropped the ball.
PUBLIC HEARING - GAS AND ELECTRIC AGGREGATE
Mr. Parham said tonight we have an open discussion to speak to the electric and gas aggregation program that the voters passed on November 8 to authorize the City to put together a program that will allow the residents to begin to enjoy lower costs in their electric and gas expenses. The City has engaged the services of Eagle Energy with Mr. Don Marshall and two of his colleagues who are here this evening to lead the public hearing for us. They are the experts and will be able to answer the questions far better than I can. Ive tried to answer them the best I can but they have the expertise. The discussion tonight is to begin to form the plan that is necessary that will explain to residents that 1) how you are included in the program versus how you are not included in the program; 2) if you chose to not be a part of the program what steps you take to remove yourself or opt out of the program; and 3) how the program will be governed as we begin to move forward. With that being said, it would be appropriate to turn it over to Don Marshall and his cohorts.
Mr. Marshall said here with me this evening are Jim Macenko and Dick Lonneman. The three of us are partners and we have been in the business of supplying electricity and natural gas since 2001. Our primary focus is electricity. All three of us are retired from the former Cincinnati Gas and Electric Company. The Public Utilities Commission of Ohio (PUCO) requires a community, once the community adopts an aggregation plan, to become certified by the Ohio Commission. The certification process requires two public hearings. This is the first and the second will be January 4, 2012. The purpose of this public hearing is to develop what the certification process refers to as a Plan of Operations. The Plan of Operations ultimately becomes the terms and conditions by which you will receive service from an alternative supplier that is selected by the City of Springdale. Were in the process of the public hearing phase. After the second hearing we will develop a finalized Plan of Operations provided to the City. PUCO then has a minimum of thirty days to certify the City as a governmental aggregate. During the tail end of that thirty day process, my firm will issue a request for proposal from various suppliers of electricity and natural gas. We will evaluate those suppliers, make a recommendation to the City, the City will make a selection of a supplier of natural gas and a supplier of electricity for your consideration. It is an opt out plan which means everyone in the community is in the plan. You have to opt out, that is, contact the supplier to excuse yourself from the plan. Ultimately, the supplier that is selected by the City will send each resident a letter and give that resident twenty-one days to opt out of the plan. If the resident takes no action, it means they are in the plan. They will then receive a follow up letter from Duke Energy and will have ten additional days to decide to be in our out of the plan. The letter from Duke Energy basically says you have elected to take power from Company X, is that your final decision? You have two opportunities to take the initiative and opt out if for some reason you dont want to be in the plan. There are a couple of issues about the notice requirement. If you are presently taking natural gas or electricity from another supplier, you will not be notified about the Citys aggregation program. The rules prohibit a supplier to solicit you as a customer if you are taking power from another supplier. You can join the aggregation plan but you need to take the initiative. The first thing you should do is contact your supplier and find out if there is a fee for switching. Normally there is a switching fee which could be as low as $25 or as much as $250. The second issue deals with credit. PUCO does not allow any customer that is thirty days in arrears to be included. Their name is not included in the opt out list provided to the City. If you have a credit issue, you can join the program but you need to get the credit issue resolved. Its not the suppliers responsibility. Its Duke Energys responsibility. Generally, the Plan of Operations is a pretty luminous document but that plan ultimately will be attached to your opt out letter that is reduced to Terms and Conditions by which you will receive service. If there are any issues that you have that arent addressed in one of these that you feel is important to know, indicate that tonight or on January 4 and we will make that issue clearer in the Terms and Conditions document that will ultimately be filed with PUCO.
Mr. Marshall said one of the very first issues is service to be provided. The services will be natural gas and electricity just as you are receiving today. You will not see any difference in the entire process. When the lights come on tonight you probably dont know or dont care if Duke generated the power or they are buying it from somebody else. That continues to be the course of action. The only thing that changes is the cost. These conditions apply to both gas and electric but there will be two different certifications, two different opt out letters. The only significant difference between the two is that Ohio Electric Utilities has in your bill what is called an excise tax. There is no issue on electricity. You continue to pay to Duke the Ohio excise tax. However, if you switch gas suppliers, the Ohio excise tax rate of 4 34/% will be eliminated from the gas bill but you will begin to pay Hamilton County sales tax which is 6 ½%. Generally when you are solicited at home, suppliers dont make that clear that your proposed price does not include Hamilton County sales tax. We make it crystal clear so that everyone in the City of Springdale is aware of the prices with the tax and without so you can make a legitimate comparison of what you are paying Duke and what your current supplier of gas cost. Thats the only difference between the gas and electric. The rates and charges will be crystal clear hopefully in the document that is delivered to your home. Generally, it is a fixed rate for a term of two to three years. All of that is subject to negotiation but the letter you will ultimately receive will state what your rate is and what the term of that rate will be. The disclosure notice is what we are talking about tonight and will be reduced to Terms and Conditions. Ten days before the letter is mailed to you we need to provide that to the Commission for their review to make sure that the Terms and Conditions comply with the Rules and Regulations of the Commission. We will make sure the Ohio Commission gets the proper documentation. The aggregation pool is all the residences and we recommend that small businesses be included. A small business is defined as a customer that uses less than 900,000 kwh/year. Larger businesses are not allowed to be included in the aggregation pool but they can join the aggregation plan. Obviously Tri-County Mall would not be included but they could join the pool on their own but they have to take the initiative. A resident normally uses about 1,000 kwh a week. The opt out program is very important. You will be given a minimum of twenty-one days. There will be a post card attached to the form that you can mail in. There will be an e-mail address so that you can contact the supplier directly or there will be an 800 phone number so you can call directly. You need to do it with the supplier. You dont deal with Duke in this process. You deal with the supplier which will be clearly identified in the letter. The rate classes generally deal with the aggregation pool. Duke has designated rate classes like residential. If you look on your bill you will see RS. All the suppliers that serve residential customers in an aggregation program have accounts receivable agreements with Duke which means the charges will appear on your Duke bill. You will only receive one bill from Duke. If you are a business customer you will probably receive two bills, one from Duke and one from the alternative supplier. Business customers use more energy. They are usually aware of two bills coming into their accounts payable department. Generally speaking, alternative suppliers do not require any deposits. If you have a deposit on file with Duke, that is sufficient. The real issue is, if you are thirty days in arrears on your bill, you will not be included in program.
Mr. Marshall said the Terms and Conditions and Plan of Operations will have how you contact Duke, the supplier, the Commission or the Ohio Consumer Council. The Ohio Consumer Council is a legal agency that represents all residential customers in the State of Ohio. If you have an issue that hasnt been resolved to your satisfaction, we would recommend that you go to the Commission first because they are more familiar with the aggregation program. If you are still not satisfied go to the Ohio Consumer Council. Were available as well. If there is an issue you are really dissatisfied with, we have a relationship with most of the suppliers that serve the Cincinnati area. Unfortunately, if there are customer details you, the customer, needs to deal with the supplier but we can help you with the Commission if it escalates. Its our experience that the customers have been very satisfied with the aggregation program. If a customer moves into Springdale from another area, they will not be in the program, but once they become aware of the program, they just need to contact the supplier. If a customer moves from one home to another in Springdale, they will be able to remain in the program. If a customer moves out of Springdale, obviously the program does not follow them. Mr. Marshall said the City has done the right thing in initiating the process. You have the protection of the City. You have our willingness to help in whatever way we can and the process should be very smooth. Are there any questions or any concerns that you would have that you would like to see addressed in the planning operation.
Mr. Grover Davis asked how can you guarantee that these prices are going to be lower than Duke? When you compare in this letter you are going to send us, do you compare the prices with Duke and what year are you comparing, the last two years or this year?
Mr. Marshall showed a copy of his bill. We will draft the opt out letter. You may have read the article in the paper last Friday or Saturday. The significance of the article as I understand it is it indicated that Dukes rates are coming down as of January 1 by 17%. Currently if you look at your bill at home, on the second page, you will see a sentence about price to compare. Right now the price to compare is 9 cents. We think the new price to compare is around 7 cents. So the opt out letter will compare Dukes current rate with the alternative supplier rate and indicate the savings. It will not be customer specific. It will be for the average customer. The opt out letter will clearly state this is how much you are paying Duke currently and this is what you will be expected to pay to the supplier. The rate generally will be fixed for a term of two to three years. With Dukes auction, the rates become effective January 1 and will be effective through May 2013. In May 2013, they will have another auction for the period of June 2013 through May 2014. It is expected that Dukes rates will come down slightly. In May 2014, they will have another auction. The rates will be effective June 2014 through May 2015. That rate is supposed to increase if you listen to all the experts. In May 2015, Duke will file another rate plan for rates for the following three years.
Mr. Davis said I am concerned that Duke does not charge Hamilton County sales tax. In this program you charge Hamilton County sales tax on the gas. You can show me a situation where the gas bill looks cheaper but the sales tax hasnt been added on yet.
Mr. Marshall stated the letter you will receive from the supplier through the aggregation plan will have the price with and without sales tax. At my home we are still buying gas from Duke but what you can do, the gas cost recovery rate. In November, Dukes gas price was $6.83. You want to compare Dukes gas cost which includes an excise tax of 4 ¾% with the suppliers rate including the sales tax of 6 ½%. If you are solicited at home by a gas company, chances are the price they are quoting does not include the sales tax.
Peggy Manis, 11921 Crossings Drive, asked can you opt out at any time?
Mr. Marshall replied yes. All the communities we represent currently are served by Dominion Retail. They know us well enough to know when they quote a price not to include a switching fee as we will negotiate it away. That would be our expectation for the City. If you are with a supplier currently you need to be careful.
Ms. Manis asked what things will be in your bid?
Mr. Marshall stated first and foremost we want to make sure they are certified by PUCO. What is their financial backing? Where are they securing the generation assets? Do they own generation or do they buy from another source. What are the terms of the agreement and how many customer complaints have they had with the Ohio Commission.
Ms. Manis asked can you ask for the energy to be renewable or will that make the price larger?
Mr. Marshall responded part of the opt out process is either you will receive it or you will be driven to a spot on the website that will have the renewable percentages. Generally speaking, if you want green power its very expensive.
Ms. Manis asked will businesses be sent a letter?
Mr. Marshall replied small businesses will receive a letter. Large businesses will not be included.
Mrs. Emerson asked how are rates based for the residents? Do the larger communities that have aggregations get lower rates because there are more of them? Would it behoove us to get more residents in or if Tri-County Mall joins, does that affect the residents rates?
Mr. Marshall said it could. Right now we have eight communities. Springdale, Amberley Village and Columbia Township all had the issue on the ballot and we are in the process of getting them certified. Five other communities are ready to go. Our goal is to merge the eight communities. Including Tri-county Mall would not really impact the residents rates. Unfortunately, Tri-County Mall is already under contract with an alternative supplier.
Mr. Knox asked what is the earliest possible date for residents to be receiving the letter?
Mr. Marshall said after the public hearing January 4 we would file the certification application. The Commission has a minimum of thirty days. In the interim Mr. Parham will request a customer list from Duke. The supplier of choice will take that list and sanitize it to make sure that only Springdale residents are notified. It takes about three weeks to do that. You need to file the letter and that takes ten days. The residents have a total of thirty-one days so our best guess is probably March.
Mr. Knox said so the residents will have at least two of the 2012 bills from Duke so they can compare apples to apples.
Mr. Marshall said through December 31 they will have on your bill the costs to compare for residents. With their new rate structure, I dont know if thats going to continue or not. I would assume so but their entire rate program with this energy auction has changed. I dont know if there will be a price to compare element on the bill or not but if there is not, we will make sure its in the letter.
Mr. Diehl asked when do you think everything will be completed?
Mr. Marshall replied I would say the meter reading date in March. They enroll customers on meter reading dates. That means the customers bill in April would reflect the lower rates.
Mr. Diehl said you said the new rate will be 7 cents. In your educated guess, what would be the aggregate rate?
Mr. Marshall said the electric rate would be around 5.8 cents. Assuming a customer uses 1,000 kilowatts that would be about $12 a month savings.
Mr. Diehl said you indicated new people moving into the community wont be in the plan. How do they get to be in the plan?
Mr. Marshall stated they have to be aware of the existing plan. Once they are aware of that, they have to contact the supplier.
Mr. Diehl said if you are thirty days behind you cant join the program. What happens if you catch up in a couple of months? Do you contact the supplier?
Mr. Marshall replied no, in that case you contact Duke. The supplier gets their money through accounts receivable from Duke so the arrearage goes to Duke.
Mr. Parham said when the customer has caught up, they contact Duke. Are they contacting Duke to say they want to leave and become a part of Springdales program? How do they gain access to the Springdale program?
Mr. Marshall said they need to clarify that their credit issue has been resolved. Then Duke will notify the supplier that the credit has been cleared up and then the supplier will notify the customer.
Mr. Parham said once Duke notifies the supplier, does the supplier then initiate the contact with the resident?
Mr. Marshall replied yes. That will be spelled out in the Plan of Operation. The customer indicates to Duke that they want to be part of the plan and Duke will notify the supplier. The supplier will then enroll that customer. It should be automatic but you should always advise customers to follow up with the supplier to make sure the enrollment has happened.
Mr. Parham said when we know the rates, the City will publicize what the rates are in the city-wide newsletter and on our Facebook page and on the Citys website so that residents do know that the program is in place and the rates are X. You talk about the Duke rate is anticipated to be around 7 cents. There is an article about Springfield Township locking in a rate of 5.346 cents that is far less than what the Duke program is anticipating at this time, just to let everyone know that those types of opportunities are out there.
Mr. Marshall said that rate was negotiated with the Township last summer prior to when it was known that Duke was going to require suppliers to pay their capacity costs. Capacity costs deal with the physical generation plant, the rate of return, and appreciation. Duke filed their plan in June. The initial plan was that all customers pay capacity costs. Duke initiated a series of settlement discussions. The case was ultimately settled in late November and part of that settlement was only suppliers would pay the capacity costs, not customers. The reason that rate is so attractive is that it was initiated before First Energy knew they were going to be paying capacity costs. My expectation is you are not going to see a rate as low as Springfield Township because the environment has changed.
Mr. Parham said the part you added in helps us understand that yes, this was an exception before a number of other things took place.
Mayor Webster said I told many residents that once we go out to the market and did this, if those rates are higher than what Duke has published then we certainly wouldnt enter into an agreement.
Mr. Marshall said that is absolutely correct. Youve done the right stuff in going through this process, but if wholesale rates are higher, then obviously you dont want to go forward. But when wholesale rates do become cheaper, then youre ready to go.
Mayor Webster said you just walked us through a process where Duke is going to have new rates at certain intervals. If this rate we get from our alternate supplier is for three years and Dukes rates change and would fall below what were paying, then youre saying we would have the ability individually to opt out of this alternate supplier and go back to Duke.
Mr. Marshall said yes, there will not be any switching fees. Green Township had a similar situation and 5, 000 customers went back to Duke.
Mr. Parham said Duke cannot charge a switching fee. You dont have to worry about a switching fee with our program or with Duke.
Mr. Vanover said the supplier will have to pay the capacity charge but the fact is it will be passed onto us. Thats the difference you see between the 5.3 the township got and the 5.8. Its not like were not being affected because we are. Its not coming out of an imaginary pot someplace.
Mr. Diehl said you mentioned that my rate is now going to be 5.8 in your best guess. Mr. Davis mentioned Hamilton County sales tax. Where does that fall in that 5.8?
Mr. Marshall replied thats on natural gas, not electricity.
Mr. Diehl said if Im buying today from ABC Company would my rates be less, about the same, more?
Mr. Marshall said I would guess it would be less.
Mr. Diehl asked Would Duke be charging me a user fee for hardware, etc.?
Mr. Marshall replied no. There are distribution/delivery charges. Those stay the same. The aggregations program is generation and transmission. You are not using the generation and transmission equipment of Duke. You are using another supplier. You are paying the other supplier a lower cost than Duke Energy. The distribution costs, meters, poles in the street, do not go away.
Mrs. Emerson said say we enter into a three-year fixed rate with a supplier and Duke Energy comes out with a better rate a year into that. Wouldnt it be in your best interest or the suppliers best interest to stay below them? Obviously the more people they have in their program, the better. Sometime in the middle of that contract can you come back and lower it to a different percentage or are we stuck where were at even though Duke drops?
Mr. Marshall said one of the issues when we rate suppliers is that Dominion specifically, does not have its own generation. If they are the successful bidder for the City, they enter into a contract with another supplier for the power necessary to provide the City. Because they have a contract with someone else, it is very difficult for Dominion to lower its rates. So in the decision making process, if you are looking at Dominion and another company that actually has generation capabilities but may be slightly higher, you may want to think about that higher rate. They have the ability to lower their rates if they so desire but it would be very hard for Dominion to lower their rates.
Mrs. Emerson said I can still opt out any time I want so Im at no risk there?
Mrs. Manis said you are going to do this regardless? You go out for bid and you dont find anything. You can go out for bid again six months later, right?
Mr. Marshall said the process of getting certified is at least thirty days. Once you are certified you are set to go. You are required to be certified every two years.
Ms. Manis said so if the rates arent good, you can wait and go out again in three months?
Mr. Marshall said Indian Hill waited two years. Green Township waited two years.
Ms. Manis asked, in three years when our bid is up, who will do that again?
Mr. Marshall said we like to represent the communities. You have your hands full buying salt, doing budgets. You need some expertise in this area. We do not charge the community. We get a commission from the supplier.
Mr. Parham asked Mr. Marshall, can you speak to the equal billing program and how it will affect the resident? Then we have been talking a lot about electric and Mr. Davis brought up questions on the gas side. We can lock in for an extended period of time on the electric side. What about on the gas side? How long would you lock in with a supplier on the gas side? My understanding is that the gas tends to fluctuate with the market while the electric is compared to the fixed rate of Duke over a period of time.
Mr. Marshall said if you are on a budget billing plan now that will not change. Unfortunately, even though your costs are going down, Duke will not lower your budget billing plan amount unless you call them. They will reconcile it in the twelfth month but they will not automatically adjust it unless you call. When we solicit gas prices, we will ask for a fixed rate and variable rate. The variable rate is generally cheaper but changes from month to month. Thats what you have with Duke. You never know what you pay for gas until you get your bill. Unless its really significantly different we kind of not recommend the variable rate. Because of the warm weather there is a lot of gas in storage driving gas prices down. Yet because gas prices are coming down, that means electrical generation is going to be fired by gas, not coal. Thats going to add upward prices. There may be some savings on gas but not as significant as electric. You can go forward with one or both.
Mrs. Harlow said the City could go forward with one or the other or both, but the resident will have to follow what the City does, correct?
Mrs. Parham said the City has the option of going with both a gas and electric program, a gas or electric program, or no program because it hasnt come back favorable enough to generate a savings for the residents. The resident still has the ability to stay with Duke but because there is no City program in existence, they still have the ability to join with one of the other groups. Now they have to also understand, if they join one of those groups, if they decide when the Citys program comes about or Dukes rates are lower, there is a potential switching fee that they will have to pay to leave that particular supplier.
Mayor Webster said I think the question here is if the City offers both, the resident can opt out of one of them and take the other one. The resident does not have to go with both gas and electric.
Mr. Marshall said if everything goes well there will probably be two letters to the residents, one for gas and one for electric unless you decide to delay one. If you think about it, were going to be past the heating season so you may want to delay implementing a gas program.
Mr. Parham said I think its important for the residents to understand that those residents who have taken an initiative to move away from Dukes program and are with one of the others, Duke Retail, Dominion, or First Energy, those residents will not receive notification from the City or the Citys supplier. If you keep in mind we are expecting our program to be up around March or April. Keep your eyes peeled for the newsletter, the website and Facebook because we want to be able to notify you that the program is up in place so you can make the educated guess as to which program is best for you. Again, the program is not for the City organization. The program is the designed to help the residents reduce their costs.
Mr. Vanover asked with the even billing adjustments, will that be a refund or credit?
Mr. Marshall responded in the month that your twelve month period ends they will do an adjustment, then readjust the billing.
Mr. Parham thanked Mr. Marshall and said they will be back January 4, 2012 for the second public hearing. Mrs. Harlow closed the public hearing.
2012 BUDGET PRESENTATION
Mr. Diehl said we are going to review the highlights of the 2012 budget and Mr. Parham is going to walk you through the first thirteen pages of the presentation. Afterwards we will cover department by department and allow you to ask any questions you may have.
Mr. Parham said over the last two years we have gone through some rather challenging times. We have watched as our revenues at a very drastic pace spiraled downward. So to be able to present the 2012 budget with the effort that the department directors as well as the rest of the staff, Mr. Thamann and our administrative assistants that helped with this project, makes us very proud for what we are going to present to you this evening. As Ive indicated over the last two years, on the very first page, first paragraph talks about we tried to reduce our expenses to keep pace with the rapidly declining revenues. There were three goals we kept in mind and tried to accomplish: 1) to reduce expenses, 2) avoid any negative effect on the service delivery to the residents, and 3) to avoid any potential layoffs especially in the essential service departments. However, clearly overall, we did not want to have a need to reduce employees. The second paragraph is the one I feel most encouraged about. This time a year ago we were presenting a document to you in which we were striving to provide a year end balance of $1.5 million. In order to function for one month its about $1.4 million. The goal this time last year was to trying to achieve at least $1.5 million. Today, the estimate that we are very proud to present to you as a year end balance for 2011 is $4,308,830. Thats a tremendous difference from where we were a year ago. We were expecting a decline of our 2011 revenues of about 7% or $1.163 million. Instead we are seeing more of a decline of 2.24% for $358,000. Thats a decline but not nearly as significant as what we were anticipating. At the same time, the 2011 general fund revenue budget is expected to be exceeded by $804,587. We have had very good news for the organization as we move forward. Our 2011 revenues are projected to come in about $804,000 above the budgeted number. Our 2011 projections are $16,026,000. We budgeted $15,222,000. In the past, the earnings tax has been the identifier to recognize when we are losing revenue. This particular year is the first time in six years that the earnings tax has actually reflected a growth. Over the last five years weve had a decline in our earnings tax. The earnings tax comes in about 10.44% above our budgeted figure. It is about 4.1% above the 2010 actual figure. The earnings tax for the organization is about 78% of our revenues. Whenever we have experienced that decline in our earnings tax, it has had a tremendous impact on our budget and our ability to provide services. The culprit in showing a decline in our overall revenues have been generated from decisions made outside our power, coming out of Columbus. There are a number of reimbursements and other funds that the City has received from the State of Ohio through the years that has been either reduced severely or they have been eliminated. One of the first ones is the Public Utility reimbursement. This reimbursement was part of the personal property tax. It was scheduled to be eliminated by 2016. Our last payment would have been received in 2015. It was one of those that would eventually fade out. In 2010, we received $11,579. In 2011 we were anticipating receiving $11,570. Instead we received $4,790. In 2012, we will no longer receive any funding from this particular source. The personal property tax has a much more significant impact on us. It too was scheduled to fade away in 2018. In 2010, we received $244,000. We anticipated we would receive $211,000 this year. Instead we received $35,000. This funding source will no longer be available to us. We know that the State Legislature and the Governors bi-annual budget will eliminate the estate tax beginning in 2013. We will receive estate tax in 2012. We will probably have some trickling effect into 2013 but there will be no more estate tax beginning January 1, 2013. We have identified three of the local government funds that the Governor and State Legislature have begun to reduce as well. In 2010, we received $309,000 from the general revenue fund. We estimate to receive $308,000 in 2011, but down to $215,000 in 2012. After that we anticipate receiving only $160,000 each year following. Thats almost fifty percent. Another source that has hit us pretty heavily is our general property tax. In 2010, we received $1.2 million in property tax. This year we are down to $950,000 which is a loss of over $251,000. That is something we are realizing today and we expect it will drop down to $928,000.
We have had a number of successes throughout the community relative to new employers coming into town. Weve had discussions over the last two budgets about two large employers, as to whether they would remain in the community or leave. One is GE. As we spoke last year there were 900 jobs under consideration. We believe that we may retain at least 300 of those jobs, however, it is still up in the air what will happen with the other 600 jobs. The other large employer is Avon. Originally, Avon identified by 2012 that they would close the facility here in Springdale. About a year or so ago they indicated that they have a desire to sell the facility; however, to remain in the facility with two of the three functions. Manufacturing would go away. The returns function would remain as well as the call center. We estimate maybe 400 jobs will remain in the community. The decision will not occur until the facility is sold and the new owner takes over and decides what they wish to do with that facility. As long as its Avon, its functioning and generating revenue for the City.
Mr. Parham stated in 2009 at the beltway center you saw Golf Galaxy, Garden Ridge, Dave and Busters and the large solid wall. Now you have Morris Furniture, Ashley Furniture, and Front Room Furniture. Home Emporium is in the old WalMart location. We now have The Vitamin Shop, Aspen Dental and Verizon Wireless at the formerly vacant lot at Princeton Pike (SR 747) and Kemper Road. There are some businesses that have simply relocated from one location to another, but they have stayed within the City of Springdale. We have had success with others moving into the community. One is Warehouse B, which is part of Best Buy. When you lose retail, it is very visible. They need the visibility in order to attract customers. When you see them you see that there is life again. Some of the restaurants that opened in the community are Smoq and Dos Amigos. We have identified some of the goals from a year ago that remain valid even this year. There are: 1) we will continue to look for ways to reduce our expenses; 2) we will continue to engage in opportunities that will generate additional revenue; 3) we will protect the vital City services while maintaining the quality of service delivered to the residents; 4) we want to maintain to the best of our ability each full time position, particularly in our essential services departments and functions; and 5) one of the most critical things is when you go from a time frame where you are looking at a $1.5 million balance to a $4.3 million balance, there is a tendency to rush out and begin to replace the many things we have delayed. In order for us to make sure we are moving forward properly in a wise manner, we need to proceed strategically about how we are going to go about restoring those vital resources, be they people, vehicles, rolling stock, equipment, etc. I would not run out and scream and say we are out of the woods. We dont know whats going to occur in 2012. We know we have some very positives. Humana is one major player that is not considered in this process. They are calculated into the 2012 budget numbers but they are not part of the 2011 year end balance. Thats a very positive situation for the City. In this particular budget, as last year, we did not include any mandatory cost containment measures as we did as part of 2010. This budget does not reflect a cost of living pay increase for employees. We will get into further discussion about our recommendation in that area. That also includes the three unions, the police patrol officers, supervisors and firefighters. Nothing is anticipated as far as a pay increase in 2012. In 2011, the only employees who received a pay increase were the supervisors and that was to recreate the difference between the patrol officer and the supervisor level position. As we have in past years asked the department directors to focus on reductions in their budgets, we have not done that in this budget. We have asked them to attempt to maintain their budgets where they are; but in areas where they can make cuts, lets make those cuts and reductions. The numbers reflect that they have done an excellent job. We have continued to focus on capital improvement projects that will provide a significant amount of outside funding for the organization. We have been very successful in that vein. The budget identified six projects that we have received seventy percent of outside funding. The overall capital improvement budget is $3.2 million. Of that, seventy-seven percent or $2.4 million is made up of those six projects. Of the total cost of $2.7 million for those projects, $1.8 million is provided by outside funding. The Citys share is expected to be $824,000. With the SR 747 northbound to I-275 westbound project, we are estimating that project, if the cost is $300,000 our share is only $18,000.
Mr. Parham said the earnings tax, for the first time, has seen a positive for us. Our 2011 beginning budget shows a balance of $3.5 million. On page 5, in the table you see the revenue we are showing for 2011 as well as projecting for 2012 and then the expenditures of 2011 and proposed expenditures for 2012. If you look at the estimated 2011 expenditures we budgeted $16,751,000. We were able to save $1.4 million showing $15,310,000. This does not consider the amounts that will be turned back as the department directors will begin to cut back on their spending at the end of the year so the number will be even more impressive. We have had to do a number of things differently than we have in the past. In 2010, were extremely fortunate that we had ten employees who retired. We always said we wanted to reduce our work force through attrition. We had another employee who resigned that year. In 2011, four more employees retired with two more resignations. Personnel costs are 75-78 percent of the budget. In the public safety departments, the number grows as high as 90 percent. Even small departments such as the Building Department with very little other expenses, most of their expenses are made up of personnel costs (wages, health insurance, pension, etc.). It is extremely expensive to employ people. As a result, we have chosen not to fill some of these positions back on a full time basis. At one time, we had eighteen employees in Public Works. Today we have nine. We were fortunate to bring back three employees on a part-time basis. They are probably working 25-30 hours a week, but were paying a smaller pension, not paying health and life insurance. Youre short a few hours but you are getting a very productive employee that is very familiar with our operations. We have one employee scheduled to retire in 2012, the Public Works Inspector. A number of employees in Mr. Williams office have identified 2013 as their retirement year. In the Police Department, after an employee reaches 25 years of service and the age of 48, they can enter into the Drop Program. Under the program, they must stay a minimum of three years but no longer than eight years. We have a number of officers who are going to hit the end of their drop in 2013 and 2014. Two will retire in 2013 and one in 2014. We have budget the replacement of those three individuals in the 2012 process. We are taking applications for those positions right now. If you can appreciate the time it takes to get an officer on the road, go through our process, go through the Academy if necessary and then bring them back for field officer training, and then for the supervisor to feel comfortable that they are ready to go out on the road by themselves. By the time we get these individuals on the road in that comfort zone, we will be very close to the retirement of these officers. At the end of 2012, even with the replacement of those positions we will still have 21 vacant positions throughout the organization. Currently we have five vacancies in the Fire Department. The plan is to fill two of those positions. We had two resignations and will fill those but leave three vacant in the Fire Department. The other position I want to share with you is to reinstate the Senior Administrative Assistant position that assists Mr. Thamann and me. Currently, we have been sharing the services of Ms. Rudemiller with the Community Center, where shes here two days and there three days. Both of us desperately need her in our different departments so the plan is to have her relocate to her full position in Parks and Recreation and replace the Senior Administrative Assistant position. Over the next five years, we will have another forty-one employees who become eligible for retirement by 2016.
One of the real successes in the capital improvements category is that we are extremely happy to hear that the SR 747 Grade Separation project is finally done. The State closed that project after four years. We had anticipated our costs would be $326,000. Instead the State indicated we only owed them $38,529. That is a savings of $288,000. Weve already gotten the traffic signal project up and going. Chamberlain Park Beaver Run bank stabilization project is up and underway. Were meeting with the property owners in the area of the Century Circle North reconstruction. We were successful in receiving OPWC funding at 50 percent or $195,000 for the Merchant Street project. Our cost would be at least $195,000 to match. The one project that is added into the budget document is the SR 4 Urban Paving project. This project was approved around 2007 or 2008. We decided to ask the State to postpone this project to allow us to use the funding on another project. It was then set for 2013. Earlier this year, I received an e-mail to confirm that the City was still looking at 2013 for this project and I confirmed that we were. Two weeks ago, I received another e-mail from a different person at ODOT saying they had now scheduled this project for 2012. They had not contacted us to see if we had budgeted funds for it. After some discussions they have now reset it for 2013. Of course, this occurred after we had placed it into the 2012 budget. I would suggest we not move the project again. If they come back at a later date and change their mind, in 2012 we have funding available. If not, we encumber those dollars and go over to 2013.
Over the last three years, due to the financial situation, we have limited the annual street program to a budgeted amount of $100,000. With such a small amount it creates a challenge to have some significant impact on curbs, gutters and streets in the neighborhoods. The projects we just talked about focus on our business community, the commercial, retail and clearly we need to continue to invest in that infrastructure because we then enjoy those opportunities when the Humanas of the world decide they are looking for somewhere to go. They can come to Springdale because there are easy, passable roadways, well managed and cared for. At the same time, because of our financial situation we have gotten behind in our neighborhoods. The last three years we budgeted $100,000. This year we increased it to $400,000 that will allow us to put together a program that will allow us to get back in the neighborhoods and get back to the curbs and gutters and some of our streets.
Mayor Webster said I asked Mr. Parham to pull the figures from 2002 through this year. From 2002 to 2008, we averaged $637,000 budgeted for the summer street program. Some years went as high as $1.2 million, some down to $150,000. We spent about 87 percent of that. We averaged $557,000 a year on the summer street program. The last three years we put $100,000 each year. This year we are recommending we bump that up to $400,000. Thats still woefully short of what we need to maintain the streets. Ive walked every street in the City this fall and I can tell you we have neighborhoods that really need attention. I strongly support leaving that in there.
Mr. Parham said the only debt the City has is the Community Center debt which we annually pay the principle amount of $400,000 plus interest. This year the interest came up to $103,800. As a result, we paid $503,800 in 2011. We anticipate that the interest in 2012 will be $89,600 and our payment will be $489,600. The debt is scheduled to be paid off December 1, 2017. At the end of 2010 we had about $2.3 million remaining on that debt.
The Northwest Business Center TIF (Pictoria) is simply a pass through of the City receiving the funds and passing them on and allowing the debt to be paid off. There is a special assessment that the property owners have to make payments whenever the service payment has not reached the debt. For the Tri County Mall TIF, I think its very unlikely that we will see a recovery of our funds because the valuation of the property has been reduced to such a level that it is not generating any income. At the same time, I think the investment that was made there will serve the community well. It has enhanced the egress and ingress into the mall as well as it will well work towards the redevelopment of the Cassinelli Square property. We still at some point would like to receive our funds back from Tri County Mall. Im willing to answer any questions you may have.
Mr. Diehl led Council through the budget document department by department.
Mr. Knox said in the Police Department five year budget it states that the medical costs are expected to increase fifteen percent in 2012, 2013, etc. The hospitalization for the Police Department, the 2011 expenditures were a little more than $385,000, the proposed is $484,000. Thats a twenty-five percent increase. Im wondering why we have that large an increase.
Mr. Parham responded the costs in 2011 reflect 33 employees. The costs in 2012 will include three new officers. You will have more employees and we have anticipated a fifteen percent increase in hospitalization. We hope it will be lower than that but it could come in higher.
Mr. Knox said we have ten percent more people so it would be ten percent more than fifteen percent which would make the twenty-five percent.
Mr. Diehl said the actual expenditure in 2010 was $222,000. In 2011 we anticipate that number to be $385,000. Unfortunately, there has been a big increase in health insurance across the board for everybody.
Mayor Webster said if you take the $385,000 we are anticipating this year and divide that by thirty-three people, then multiply that number times thirty-six and then multiple that by 115 percent, you come out to $483,834. We have $484, 000 in there.
Mr. Knox said thats just what I said a while ago. Ten percent more people, then fifteen percent.
Mr. Parham said you do see a dramatic increase when you go from 2010 to 2011. We have to also remember that we changed the program then. In the old program, the claims expenses were found in the Health Insurance Trust Fund. The only thing we were showing in the departmental budgets was the fixed costs that we were paid for the re-insurance.
The only other items I would point out is things such as uniforms, uniform cleaning allowance, seminars and conventions, if you look at the notes on the opposite page, you will see why the cost increased. You will notice that those line items reflect the addition of the three new officers.
Mr. Knox said the radio costs this year were $17.05. Next year it goes to $18.30. I suggest to the residents that if you have a real emergency please use 911. If you dont have a real emergency please save the City $18.10 per phone call.
Mr. Parham said in the Fire Department under capital improvements you will see the addition of self-contained breathing apparatus (SCBA). We are extremely fortunate to have partnered with the City of Cincinnati where they are making a change over in their SCBA. They are getting rid of their old ones. Because they have multiple chiefs, brigades, etc. they have these sitting in a vehicle not being used and are now switching to something new, they are going to get rid of those old, unused units. They have agreed to sell the old units to the City for a cost of $10,000. We have already received six of those units to date and our people are going through training to make sure they fit properly and get accustomed to them. We will get thirty SCBAs, thirty additional face pieces, and twenty spare cylinders. I asked the Chief what the cost would be if we were getting those on the market ourselves. The number he has given me is around $200,000. Its a tremendous savings for us and in most cases they have not been used.
Mr. Vanover shared with Council that a resident had a fire at her home indicated that the Fire Department had to open up the wall and ceiling of her home. One of the comments she made was she was thoroughly impressed that the employees had thoroughly cleaned up before they left.
Under Parks and Recreation Mayor Webster said the Budget does include the cost of opening the center on Sunday for the full year. Realistically it will probably be February before we actually get everything ramped up but the expenses are in the budget to accommodate it for the entire year.
Mr. Knox said on page 10, it says Springdale Senior Citizens Club luncheons, I suggest we remove the word club.
Mr. Parham asked they no longer call it the club?
Mr. Knox replied its called the club but the City does not fund the luncheons put on by the Senior Citizens Club.
Mr. Parham stated there are some luncheons and I asked Mr. Karle to share with me the cost of the holiday luncheon where the participants paid. In that instance members paid $14 and guests paid $16. In a number of programs I understand that we help organize the program and then they pay back into the program for their participation.
Mr. Knox said let me check back but I dont think that was specifically a club function.
Mayor Webster said this probably refers to the overall senior group not the Springdale Senior Group but well look into it.
Mr. Knox said Ill look into it but I dont think it was a Capital C club function.
Mr. Parham said we can remove Club.
In Administration, Mr. Parham said questions came up at the Finance Committee meeting as to whether we were charging individuals for the credit card machine. No, were not. The other was whether we charge defendants for subpoenas. Yes, we do.
Under Street Repair Mrs. Harlow asked about the street sweeper.
Mr. Parham said as part of our NPDES (storm water quality control regulations) permit we are required to sweep our streets on a quarterly basis. Our current sweeper was purchased in 1994 and it is not always picking up the material as effectively as we need. We also use it to clean catch basins and other things. It is at a point that it just isnt performing productively so were looking at replacing the street sweeper. To finance the street sweeper over a three year period just as we did for the ambulance, the first payment will be in 2012. Mr. Williams was able to get quotes on a lease to own from Fifth Third at 1.98 percent, PNC at 2.75 percent and Huntington at 2.15 percent.
Mrs. Harlow said so we have two pieces of equipment that we are replacing this year, the ambulance and the street sweeper.
Mr. Diehl said I would like to thank all the City employees for their fine efforts over the last couple of years. Secondly, Id like to echo what Kathy McNear said, Mr. Parham that this is an excellent, excellent budget that you put together.
Mayor Webster said this is a document that Mr. Parham has lived with for the last three months. I think thats why it took so long to go through it, because hes proud of it and he should be. Its an outstanding document.
Mrs. McNear said I have been through the document many times. One of the comments I made during the Finance Committee meeting was as you go through the documentation, as you look at the calculations you think thats something that makes me want to ask additional questions. If you look to the left of the book the answers were right there. I think you notice as we went through each department this time there werent a lot of questions because the questions were answered right there in the book.
Mrs. Harlow echoed Mrs. McNears comments.
ORDINANCES AND RESOLUTIONS
ORDINANCE NO. 48-2011
IMPOSING A MORATORIUM FOR A PERIOD OF SIX (6) MONTHS (180 DAYS) ON THE GRANTING OF ANY PERMITS ALLOWING THE OPERATION OF SWEEPSTAKES/INTERNET CAFES WITHIN THE CITY OF SPRINGDALE, AND DECLARING AN EMERGENCY
Mr. Squires made a motion to adopt and Mr. Vanover seconded.
Mr. Forbes said I want to give Council the latest update on this. Just a day or two ago I read that the bill that has been introduced at the State level that had been directed to a committee, that a substitute bill has been submitted. The one significant change is that the original bill had a provision that townships and municipalities would have the authority to completely ban this type of use. That has been removed as I expected it would have been and it now says the townships and municipalities will have the right to regulate these uses. That is the path we are heading down and we will continue to keep an eye on this bill as it makes it way through the State and also review what regulations may be required here no matter what the State does.
Ordinance 48-2011 passed with seven affirmative votes.
ORDINANCE NO. 49-2011
AMENDING ORDINANCE NO. 22-2009 AND ORDINANCE NO. 19-2011 TO PROVIDE FOR WAGE INCREASES AND DECLARING AN EMERGENCY
Mr. Vanover made a motion to adopt and Mr. Knox seconded.
Mr. Parham said there have been no wage increases identified in the budget presentation. However, as weve discussed with the Finance Committee of Council we would like to recommend and what this ordinance would do is provide a 2.5% wage increase for all full-time employees of the City of Springdale as well as part-time firefighters. The other part that this legislation does is keeps us compliant with the State of Ohio minimum wage law.
Mayor Webster said I didnt hear you say non-union. This is for the non-union people. The police supervisors tag along with the other one so the other two unions have opened negotiations so this does not include the union folks. That will be resolved at a later date. Id like to call everybodys attention that the last raise these people have had was in 2009. In 2010 they were asked to take a 3.8% decrease. We restored that this past year so really theyve been treading water. Our employees have suffered through the bad times with us and as Mr. Parham indicated in his budget report, were not totally out of the woods but were a lot better off than we were this time last year and the year before that. I think its only fair that we take care of the employees.
Mrs. Harlow said I agree that our employees have been the backbone of our community. They stepped up. Theyve taken pay cuts. Theyve taken responsibilities and I personally have not heard any complaining when they had to take on additional work.
Mr. Mayor said believe me theyve all taken on additional work as evidenced by the number of open positions weve operated the City with over the past few years.
Mr. Hawkins said along the lines of what you said Mr. Parham talked about doing the voluntary furloughs again, over the last few years employees have also helped the City save money by doing the voluntary furlough. I am also in favor of the 2.5 percent increase.
Ordinance 49-2011 passed with seven affirmative votes.
ORDINANCE NO. 50-2011
SUPPLEMENTAL APPROPRIATION / ESTIMATED RECEIPTS ORDINANCE TO MAKE APPROPRIATIONS FOR CURRENT EXPENSES AND OTHER EXPENDITURES AND ADJUST ESTIMATED RECEIPTS FOR THE CITY OF SPRINGDALE, OHIO DURING THE FISCAL YEAR ENDING DECEMBER 31, 2011
Mr. Vanover made a motion to adopt and Mr. Squires seconded.
Ordinance 50-2011 passed with seven affirmative votes.
ORDINANCE NO. 51-2011
TEMPORARY APPROPRIATION ORDINANCE FOR THE PERIOD JANUARY 1, 2012, UNTIL THE FISCAL YEAR 2012 APPROPRIATION PERMANENT ORDINANCE IS ADOPTED BY CITY COUNCIL
Mr. Vanover made a motion to adopt and Mr. Squires seconded.
Mrs. Harlow said these are our end of the year housekeeping items that we do every year.
Ordinance 51-2011 passed with seven affirmative votes.
RESOLUTION NO. 26- 2011
RESOLUTION OPPOSING CENTRALIZED MUNICIPAL INCOME TAX COLLECTION IN THE STATE OF OHIO
Mr. Knox made a motion to adopt and Mr. Vanover seconded.
Mr. Squires said I have read a couple of editorials written by CPAs and they seem to be in favor of this. Could you give me some idea why they would want to do this and what kind of fees are they going to impose upon us to redistribute that money to us?
Mayor Webster said we dont know. A lot of the discussions that are taking place are not open to the public at this point. As far as I know there is no bill that has been made public. I think maybe the reason some of the CPAs may be in favor of it is because there are small taxing entities that maybe dont have a full-time finance officer like we have; records probably arent kept as well as they should be so it makes it harder for a CPA to do his job. We very much are opposed to this. I think the resolution says it all as far as being an infringement on home rule charter. I asked Mr. Williams to work up some numbers for us as far as expenses versus collections. Naturally the higher the collection the lower the percent. This year, for instance, it looks like we are going to spend 3.37 percent of our revenues collected for expenses to run the Tax Department. Last year it was 3.68 percent and in 2009 it was 3.15 percent. I would be willing to bet you that the State cannot do it that efficiently. In addition to that, the staff also administers the cinema admissions tax, entertainment tax, and the transient occupancy tax so we get that for literally nothing with the staff thats over there. My concern is that it is an infringement upon our rights. Once we send this money to Columbus, its Columbus money to give back to us and they will give it back at their schedule. Its a matter of time until somebody in Columbus says look at all this money were sending back to Springdale, Sharonville, and Blue Ash. Maybe it would be a good idea to spread this out to a town or village that doesnt have a tax and give everybody some of it. I dont think for a minute that long term wise well get 100 percent of our money back. There could be more taken out of there than just a nominal collection fee. I think we have to resist this with all our might and I also would like to see instruction given to the Clerks office to have a certified copy of this sent to all the members of the legislature and the Governors office.
Mr. Squires asked to our two attorneys, doesnt our constitution guarantee or at least state that we are a home rule state?
Mr. Forbes replied Ohios constitution grants what we call home rule authority to municipalities. Its the constitution and state law that gives you the authority to have a municipal income tax in the first place. This is kind of contrary to everything that is established locally. It is a local income tax that is administered at the local level which is what the home rule amendment to the constitution is all about, keeping local issues local. This seems to be contrary to that.
Mrs. McNear said you think about the services that are provided by our Tax Department. You can bring up all your tax information and the folks in the office will actually help you prepare your taxes. The people have a relationship with our Tax Department and that would never happen from Columbus so I am vehemently opposed to this. It takes away the timeliness of us having our money when we need it so we can provide services. There will be fees when they put that in place, then what happens the next year. There are just too many opportunities with their hands in our pockets to further destroy our financial base here.
Mr. Hawkins asked do we have any idea how imminent the danger of this coming out as legislation? Obviously they have had discussions but how far along are they?
Mr. Forbes said my understanding from some Legislative Bulletins that I received from the Ohio Municipal League and you probably get them here, I know there are discussions right now and if the legislation has not been introduced already, it is being prepared to be introduced.
Mr. Knox said this is déjà vu all over again. They tried this ten years ago. A group of us from southwest Ohio joined with a bunch of other people from the state and we went to Columbus and told them what we thought of it. We found out most of the legislators had no idea what they were talking about in this case. It was $5.2 million just to get it started and then they would be charging us 1.5 percent. It was all done in the name of efficiency. If we do this all over the state everybody is going to benefit from it but as the Mayor was pointing out and Mrs. McNear was pointing out, we cannot do away with our tax department because there are too many things to do there. There really isnt any efficiency. It will end up costing us money even if it works well. As we all know the State is not good at doing certain things and this would be one of them. This is a bad, bad idea and I am vehemently opposed to it and Id be happy to go back to Columbus and tell them that.
Mayor Webster said this is not the first assault we have had. They have tried it ten years ago and they just continue to come back. They get rebutted and it dies for a few years and they bring it back up. They are bound and determined that they are going to centralize this collection process.
Mrs. Harlow asked would our voices be better heard if we band together like we do with the Center for Local Government, if we get other communities to also join us in our cause?
Mayor Webster said there is a meeting of the Hamilton County Municipal League January 30 and that will be one of the topics of conversation. Im sure coming out of there well probably send something to Columbus. I think we ought to go it alone here and then join any other effort that comes around.
Mr. Vanover said one percent was what they were saying ten years ago. The fact or the matter is unlike our local departments, adding responsibilities at the state level incur adding more people. Theres also a penalty we will pay with increased state taxes. Even if they dont more of our money is going up there because we are paying for this bigger, governmental entity and bureaucratic BS. Were giving our rights away. At some point we have to take a stand. I agree with the Mayor that we do it here and then if someone wants to join up with us they join up with us. Its not the first and it wont be the last, you can almost guarantee, but we have to take a stand. If we are silent we are giving a vote of approval and thats dangerous.
Resolution R26-2011 passed with seven affirmative votes.
Mrs. Harlow asked Mrs. McNear to send certified copies to the State legislature and the Governor.
COMMENDING STEVE GALSTER FOR HIS DEDICATION AND SERVICE TO THE CITY OF SPRINGDALE
Mrs. Emerson made a motion to adopt and Mr. Vanover seconded.
Mayor Webster said I would like to take this opportunity to express to Mr. Galster my appreciation for his effort over the years. He certainly made a difference in the City and I enjoyed very much serving with him not only on City Council but also on the Veterans Memorial Committee. He and I worked very closely together getting the earnings tax increase from one to one and one-half percent. I appreciate his efforts in that regard and everything else he did for the City.
Mrs. Emerson said I want to thank Mr. Galster for his many years of service to the City as a Councilman. Although Ive only been privileged to work with him over the past two years its been a pleasure. I will miss Steves independent thinking and diverse ideas here on Council. I always admired Steve for speaking out and sharing his ideas even though they may not have been the most popular at the time. Popularity was never in Mr. Galsters vocabulary. He just wanted what was best for the City. Thanks Mr. Galster. Well miss you.
Mr. Vanover said I give a tip of the hat to Mr. Galster. I served with him on Planning Commission. The resolution is correct. He was a big integral drive in bringing the Veterans Memorial to fruition. I remember the Taste of Springdale and the festivals and hes in the booth hawking tee shirts and everything else we could put a moniker on. Once he set his mind to it he went after it. Its been a pleasure serving with you Steve, calling you a fellow Council member and Planning Commission member.
Mr. Hawkins said I spent six years with Steve on Planning Commission and two years on Council. I thought he was a great role model as I was starting out on Planning Commission. He always had a poignant face for the applicant to look into. I thank him for his great service and hes been a great city servant.
Mr. Knox said Steve and I were part of what I called the class of 1995. The Mayor was elected for the first time. Steve has done a whole lot of good things for the City and he will be missed. I hope he gets to relax for a while.
Mr. Diehl said a message to Steve, job well done.
Mrs. Harlow said I think we have a very beautiful Veterans Memorial and I do know that Mr. Galster put a tremendous amount of effort and work into that. Im very proud of that memorial. Every time I pass by it I thank our soldiers and people who have served in our military. I know it was a long, arduous task getting that completed. Its something the City can be really proud of and Steve can hang his hat on that one. I think Mr. Galster had a nitch in Planning Commission, something he had a passion for and it came across. I think he served the City very, very well in that capacity.
Resolution R27-2011 passed with seven affirmative votes.
RESOLUTION NO. R28-2011
COMMENDING ROBERT EMERSON FOR HIS DEDICATION AND SERVICE TO THE CITY OF SPRINGDALE
Mr. Vanover made a motion to adopt and Mr. Squires seconded.
Mr. Squires said I was a member of the Board of Zoning Appeals for many years. I think of Bob Emerson as an outstanding member of that board. His insight and dedication, his homework as to the variances that came before that board was inspiration to a lot of us because he always did his homework. He had an insight into a lot of things that he brought into the discussion and I enjoyed working with him. He was an outstanding member and will be sorely missed.
Mr. Hawkins stated I also worked with Mr. Emerson on the Board of Zoning Appeals and echo the sentiments of Mr. Squires. He was always very well prepared and a true asset to the board.
Mr. Vanover said I unfortunately didnt have the opportunity to serve with Mr. Emerson on BZA but having served on that board, I think it is one of the toughest boards because you have to look your neighbors and friends in the eye and sometimes you have to say no. Thats tough. Theres always a little blood and emotion on that board with some of the decisions especially if they dont go the way the applicant wanted. It is a tough board and I think he did a yeomans job and I think the City is better off because of it. Thank you Bob.
Mrs. Harlow said I also had the pleasure of serving on BZA with Mr. Emerson. It is a hard board. He did a good job and I thank him for that.
Mrs. Emerson said Bob would like to pass on an apology for not being here tonight. He had a prior commitment but there were a couple of things he wanted me to say. He wanted to thank the City for their support and he wanted to put out a special thank you to Mayor Webster for giving him the opportunity to serve the City.
Resolution R28-2011 passed with seven affirmative votes.
Mayor Webster said Id like to talk about an issue that was raised by a resident at the last Council meeting, that being former Mayor Ron Pitman. Im sorry he isnt here tonight. He raised some interesting questions about our Housing, Building and Fire Appeals Board. He is right, that is a board appointed by the Mayor. Its a three member board with an alternate. I have staffed that with four residents of the City. We talked about the lack of training and what we may do to shore that up. In talking with Mr. McErlane who has been our Chief Building Official and head of the Building Department for the last twenty-five years and we do have minutes. Mr. Pitman was wrong about that, we do have minutes and I have them right here from the meeting a few weeks ago. In the last twenty-five years we have had five meetings of that board. We can spend all kinds of money schooling and training these four individuals but whos to say they are going to be there if they meet on average once every five years. I propose to restructure the board in this way. I propose to have the Law Director serve as the director of that board. Right now Mr. McErlane does that. I would not want to be in a residents shoes appealing as Mr. Pitman was, a decision that Mr. McErlanes department had made and then walk into the meeting and Mr. McErlane is instructing the board on how to handle this. I can see where there is a little perceived unfairness. Im sure Bill bends over backwards to be fair. I propose, if its a Building Department issue, Mr. McErlane would certainly be there but not directing the meeting. I would have the Law Director maybe meet five to ten minutes with the board, let them elect a chairperson or spokesperson for the board, which they dont have now. The Law Director would then direct the meeting, here is the evidence, heres what you need to do, serve at the elbow of the chairman. Hopefully that would suffice instead of worrying about trying to keep these people constantly trained.
Mrs. Harlow said that sounds like an excellent idea. Let Mr. Forbes be the facilitator and keep it on track. Those are your appointees.
Mayor Webster said Council created the committee but the Mayor shall staff it.
Mr. Vanover said we have had some discussion amongst ourselves and I think its time to listen at a couple of Charter issues, specifically the terms or committee assignments. I as a district representative am appointed to a committee and I serve my term. I have no problem but it becomes tough for whoever the sitting president is because they have one or two less people they can assign on committees. I think it hinders our growth as Council members because we get tied in. Ive sat on Planning Commission for seventeen years. Ive served on other committees too. We have stymied or hindered the development of others. The presidents term is two years so the incoming president comes in and their hands are tied because you have a Council person who is assigned to a committee for four years. It could be two years into a term. I think its time to take a look at it. Have Charter Revision look at it. Give them direction and then turn them loose.
Mrs. Emerson said Mr. Vanover, we had lengthy discussions over this last year. Mr. Hawkins and I both went over the Rules and Laws and I think we came to the consensus that it was that way because we wanted continuity on those committees and we also wanted to keep experience in there instead of putting two people who are not experienced on those two committees.
Mr. Vanover said continuity is a good thing but that point of view disseminates the idea that Council members direct the other five with their point of view. I know thats not the case. With continuity, there is more than just Council on that committee. Theres the appointments of the Mayor so I dont see where the Council appointments would be that big a threat.
Mrs. Emerson said it could have potentially this time been a big threat because of the way members were moved around. There was a potential that all those mayoral appointed would not be reinstated into those committees so we had a potential of only having one of the same people because everybodys term ended. Thats a big turn over on a very important committee. I think we need some experience and stability.
Mrs. Harlow said maybe we should have Rules and Laws look at mandatory rotation so that one Council member doesnt sit on that committee term after term after term.
Mrs. Emerson said its never been that you have to serve term after term after term. I believe the Charter said its a four year appointment. That would be one term of a Council member. Like the issue with Steve Galster, he was placed on there every term after that. He served four years and then after that he was nominated again for another four years. It was at the option of Council and the President to move him at that time. I believe it says four year term so its not term after term.
Mr. Hawkins said I echo the sentiments of Mrs. Emerson. I understand as president you want to have more flexibility to move people around. I understand the idea that everybody on Council gets the opportunity to do different things and serve on different committees and boards. There are only two boards, Planning Commission and Board of Zoning Appeals, while there are only two spots that remain the same for that four year term, I do think that the Charter is such to have a continuity there. It goes beyond just the sheer numbers and some of this is about making sure the visions the City has continues on and is consistent. I cant remember how many years ago it was when we had the folks come in to do the presentation with regard to the Kemper Road/SR 747 area but they laid out a vision for that area that would transpire over the next ten, fifteen, twenty, twenty-five years. There is some value to having particularly City elected officials, City leaders in those positions where they can make sure those visions are continually adhered to as we go down the road. As Mrs. Emerson indicated, you are not tied to it for future terms; its just for that one term that you are set on it. We have been fortunate. At the same time there is cause for concern from some people, particularly on Planning Commission. We have been fortunate to have Tom Vanover and Steve Galster be on there and garner all that experience. I can understand when there is no Steve Galster and Tom Vanover ends up on a different committee or board, folks can say where is the experience. If we are sticking to the Charter as it is now, I think that continuity will be valuable. In terms of Planning we will be fortunate that we have several members who have served on Planning Commission, Mr. Diehl and me among others. On Board of Zoning Appeals this time around with Mr. Squires coming off, we had Council and Mayoral appointments and the appointment from Planning to BZA, we had three new members on Board of Zoning Appeals. If we had the opportunity to move the one Council member, myself, who was serving a four year term, we would have had a four person change including not having the same chairman we had previously. That is a pretty significant change on a board that is probably the fastest way we can end up down in Hamilton County Commons Pleas Court. Things like that create some concern for me in terms of the position we might be putting ourselves in as a City. I understand the concern that Mr. Vanover and Madam President have brought, if it goes to Charter Revision they can look at it and if they determine to put it on the ballot then the voters will speak to that.
Mr. Diehl said Mr. Hawkins and Mrs. Emerson, you bring up really good points. It s tough to argue with those points. However, I think you are missing one key thing. The Mayor appoints three individuals. The Mayor is elected every four years. The President of Council is elected every two years. He or she appoints that person. We are not talking about the term of the Council member. Im more concerned about the office that appoints those people. In two years, if you have a new President of Council, that President of Council should be able to pick and choose their own people for Planning and BZA. I think its more important who appoints them than the term of office.
Mr. Vanover said I put myself under the microscope, not just the two year but you mentioned something, Madam President, that weve had discussion about, cycling Council people through the various committees. It is easy and its status quo that we send me back to Planning Commission and I enjoy it. At some point in time, Tom Vanover is not going to be around the and the City is going to fall on the Lawrence Hawkins, Holly Emersons, Ed Knoxes, Box Diehls, Mrs. Harlows. Its going to have to go. We hamstring ourselves. As it says were not giving tomorrow. I could walk out and end up a bumper sticker on a bus. The fact is it would aid in development of all of us to be around. I served on just about every board that we have dominion over. Some are a lot more fun than others. Some are a lot more high profile. One of the factors of the continuity that we talk, speaking specifically to Planning Commission, is Mr. Bill McErlane, who has been the Building Official for twenty-five years. We have our legal counsel, City Planner Anne McBride. Were not without support. We are players on the stage. This seat was occupied by someone else before me and will be occupied by someone else after me. I think the flexibility for the appointments and also I think we ought to look at ourselves and invoke restrictions, or term limits. Mr. Diehl and I have had discussions about that to help stymie the continued status quo process. Thats where Im coming from.
Mayor Webster said I really dont have a dog in this fight so I could care less what you do but let me just give you the benefit of what I think has caused the problem. We used to not have the problem of people going to different committees because we used to not have the stipulation on BZA and Planning that you have to have one at-large and one district. If you stop and think about it, if you have three at-large people and one of them becomes President of Council, that only leaves two at-large people. One has to go on Planning and one has to go on BZA. Once theyre on there, the next time around, if you elect the same person president you will have the same people serve on the committees. You get yourselves in, I hesitate to use the word rut because you and Mr. Galster have done fine jobs on the Planning Commission, but you get the same people on the same committees, time after time after time. You serve four years, then you go back to your constituents and they say what did you do? You say I served on one committee. Through no fault of the president of council you dont have the flexibility to move people around. Four years on a committee is fine as long as you dont have to have one of this and one of that. But once we changed the Charter and we did that under the guise that we needed continuity on these boards, so we got that. But then with the four year term, the two of them arent compatible. I think one of those things needs to be taken out of the Charter and I think youd have a hard time going back to the people and unselling what we sold ten or twelve years ago. I think therein lies the problem.
Mrs. Harlow said going back a couple of years ago, and I am not beating up on Mr. Galster in any way, shape or form, I had an opportunity to move Mr. Galster off of Planning but with the economic situation our city was in I felt it was really, really important to have his expertise on Planning. We were going to have people coming into the City in a down economy and we wanted people sitting on Planning who knew what they were doing, who could be professional, who could sell the City and make things happen for that developer or that business that was coming in but I would like to have Charter Review take a look at it and see if there is a validity in taking it to the voters and see if they would like to change one or the other.
Mrs. Emerson said as far as the Steve Galster situation, we cant keep blaming that he was put on there four straight terms so you cant blame the Charter for what was set out. You have to blame us and the choices we made after that. What Mr. Diehl said with the consistency, if we dont have the common denominator of the president but every two years and we dont know whos coming in, why would you want to change the only consistency on that board which is the at-large and district Council people who are on it. That would be the only consistency you have on that entire board because you dont have the president who is elected every two years and then the mayoral appointed positions, none of those are for sure. The only for sure things you have are those two Council members. As a resident coming to that board asking for variances and stuff, I would not want to be that resident on a board with all new members and inexperience and not knowing for sure how things are carried out. I feel we owe the residents the experience on those boards.
Mr. Knox said I would like to mention a another facet of the argument that the Mayor and you made, Madam President, that we dont want to tie the hands of the President of Council by making strict rules that will stop she/he from appointing the best person for the job. Id be very careful what we put in writing.
Mr. Vanover said I think too, yes Im elected by a district quadroon but I serve no less than the entire city because my charge when Im sworn in is to uphold the U. S. Constitution, the State of Ohio Constitution, the Springdale Charter so its not that Im focused on one area. Im charged by the design of my capacity to serve the entire city. Unfortunately, thats where some of our compadres in Columbus and DC got off the track. I think that we all look at all of it as whats best for the city. I cant think of anything that would benefit Heritage Hills that wouldnt benefit the entire city. Its not like were trying to win pork for our district because I think this is the best example of what our founding fathers had in mind when government was set up. I think this is probably the purest form of a republic democracy that is left in tact, if you call it that. I dont think it can do any harm in throwing it to Charter and let them chew it over. We still have final say on whether or not it goes out to the electorate. Quite honestly, when I served on Charter Revision before I came to this side of the dais, that was one of our charges then, to go through and see where we could help the government operate more efficiently. We interviewed every department under the sun. We relegate Charter to a reactive board and the reality is it best serves us to be a proactive board. I think this very well could be a case.
Mrs. Harlow said we would need a consensus of Council. Mayor Webster said thats your call.
Mrs. Harlow said I will send this to Charter and ask them to make a recommendation to Council.
MEETINGS AND ANNOUNCEMENTS
Volunteer Firefighters Committee - Dec 22
Planning Commission - Jan 10
Board of Zoning Appeals - Jan 17
COMMUNICATIONS FROM THE AUDIENCE - none
UPDATE ON LEGISLATION STILL IN DEVELOPMENT
Adopting Annual Appropriation/Estimated Receipts - Jan 4
Mutual Aid with Hamilton County - Jan 18
RECAP OF LEGISLATIVE ITEMS REQUESTED
Resolution 1 Investment of Funds - Jan 4
Resolution 2 Payment from Hamilton County - Jan 4
Council adjourned at 10:32 p.m.
Clerk of Council/Finance Director
Marjorie Harlow, President of Council