WEDNESDAY, FEBRUARY 4, 2009

REGULAR MEETING

7:00 P.M.

1. ROLL CALL. Mr. Fix called the meeting to order at 7:00 P.M., with roll call as follows: Mr. Sabatino, Mrs. Hammond, Mr. Smith, Mr. Fix, Mr. Sauer, and Mrs. Sanders were present. Mr. Wisniewski was absent due to a family member’s illness. Others present were Mayor O’Brien, Tim Hansley, Lynda Yartin, Linda Fersch, Nate Ellis, Dennis Schwallie, Brian Fox, Frank Hirsch, Paul Martin, and others.

Mr. Fix stated prior to getting into the agenda, he understood some individuals were present this evening that would like to address the Committee.

Mr. Brian Fox, Pickerington. Mr. Fox stated he was present this evening to discuss the Lions Club Labor Day parade, fish fry, and other Labor Day festivities. Mr. Fox stated he was requesting Council exempt the Lions Club from any future requirement to pay police overtime that the police incur for the Labor Day festivities. He stated he understood the City had a tight budget, but he felt the Lions Club should not be looked at as an expense. Mr. Fox ascertained Mr. Sabatino had provided a copy of an e-mail he had sent that listed several things the Lions Club has done in the past, such as volunteering for Parks Department activities (Halloween Haunted Village, Easter Egg-stravangza), outfitting a “soft room” for the Police Department, building the Victory Park Shelter House, donating the funds to move the Sycamore Creek Covered Bridge, etc. Mr. Fox stated the Lions Club has given much to the City and his point was that the Lions Club has given much to the City and he felt they were not an “expense” but a “partner” with the City. He stated when the City asks for something, if they can help they do, whether it be large or small, monetary, volunteer, or whatever they are there for this community. Mr. Fox stated the City has never asked them to pay for the police department overtime and he would request that we keep that same policy.

Mrs. Fersch stated Mr. Schwallie was present for the discussion regarding Diley Road financing, and Mr. Hirsch and Mr. Martin were present to discuss the Health Department issue.

2. APPROVAL OF MINUTES OF January 14, 2009, Regular Meeting. Mr. Smith moved to approve; Mr. Sabatino seconded the motion. Roll call was taken with Mrs. Hammond, Mr. Fix, Mr. Sabatino, Mr. Smith, Mr. Sauer, and Mrs. Sanders voting “Yea.” Motion passed, 6-0.

Mr. Fix stated he would take discussion regarding Item 3.C. on the agenda, Review and discussion regarding financing options for Diley Road.

Mr. Dennis Schwallie stated he, Mrs. Fersch, and the City’s financial advisor Mr. Kramer, have been discussing various options on the Diley Road financing. He stated three options had been distributed to the Committee. Mr. Schwallie stated Scenario 1 was to continue with the annual payment of $723,140 as scheduled until 2014 and then refinance the balloon payment with bonds for an annual payment of $292,625 for 20 years; Scenario 2 was to refinance the entire SIB loan with bonds in 2009, and have an annual payment of $604,875 for 20 years; Scenario 3 was to continue the SIB loan payments until 2014, but borrow the full balloon payment in 2009 with bonds which would mean an annual payment of $906,523 for 22 years. . Mr. Schwallie stated Mr. Kramer had estimated the interest rate at five percent; however, it is difficult to guess what the interest rates will be at that time. Mr. Schwallie stated the estimated total interest to be paid under Scenario 1 is $3,567,984; Scenario 2 is $4,478,875; and Scenario 3 is $2,694,043. He stated the option of doing nothing at this time would be Scenario 1. Mr. Smith clarified Mr. Kramer’s hope was that the interest rates would be better than five percent when we would go out for bonds. Mr. Fix stated he felt the question was if we could make the higher payment now that is in Scenario 3 so we would pay $873,000 less in interest. Mr. Sabatino stated we also need to consider the fact that $723,000 now is through 2014 when our payment will decrease. Mrs. Fersch stated if the income tax had passed we could make the higher payment, but without another source of additional revenues coming in, she felt it would be very difficult to commit to that payment. Mr. Schwallie stated in Scenario 2 the annual payment was less, but you were paying more in interest. Mr. Sabatino clarified with Scenario 1 in 2014 our annual payment would go down to $292,625 by refinancing the remaining SIB for 20 years. Mrs. Fersch stated we made two payments on the SIB loan last year and we will be making two payments this year. She stated we will not be paying the full $723,000 this year because we have not borrowed the full amount of the loan, but that full amount will probably kick in in 2010. Mr. Schwallie stated he would point out that under Scenario 1 you are really financing Diley Road over 30 years and that is fairly long for a road improvement. Mr. Sauer stated in 2014 we will still have the option of determining what type of bond we want to go after and we might be in a situation where we would want to go out for ten or fifteen years rather than twenty. Mr. Sauer further stated he felt over ten years $900,000 was a lot and could be used for other improvements around the City instead of paying it to the banks in interest. Mr. Hansley stated he was concerned that what would hurt us in the short run is the annual payment no matter which of the scenarios you look at. He stated we needed the income tax to pass to pay debt, and this is an example that any of the three options you are sacrificing operating for this major capital improvement that we took on. Mr. Hansley stated whichever scenario you choose, this payment must be paid first before other operating expenses, so you would sacrifice operating programs. He stated he thought staff would support Scenario 2. Mr. Smith stated he would like to see a modified Scenario 2 where it is financed for a lesser time than 20 years. Mr. Smith further clarified that you cannot prepay on bonds for at least ten years. Mr. Sauer stated he felt you bite the bullet for four years for a decision that was made, you meet your responsibilities, and after that time look to see what can be done. He stated he had a problem with committing the City to a $604,000 payment for the next 20 years and also asking the citizens to pay another $900,000 in interest over that period of time as well. He stated if there is anything we can do to sacrifice now so that over the long term we are better off, he felt that was the more responsible way to go. Mr. Hansley clarified that Mr. Sauer was in favor of Scenario 1. Mr. Sabatino stated Scenario 1 is less than half of anything else that is proposed and once you get to 2014 you have 20 years of paying half as much. Mr. Sauer stated even if the bond rate fluctuates and it goes up and we were paying another $100,000 it was still $200,000 lower than the next highest one. Mr. Hansley stated with Scenario 1, you budget for that first at the expense of anything else, that debt has to be paid. Mr. Schwallie stated again with Scenario 1, Council would not do anything. Mr. Fix stated as he understood it, it was the consensus of this Committee to stay with Scenario 1, and in 2014 a decision would need to be made. Mr. Sabatino stated he felt in 2013 there would be a better idea of what to do in 2014.

Mr. Fix stated he would address Item 3.D. on the agenda, Review and discussion regarding Franklin County Board of Health proposal, at this time.

Mr. Frank Hirsch, Fairfield County Health Commissioner, stated he was present this evening to address concerns about Pickerington pulling out of the merger with the City of Lancaster and County of Fairfield. He stated he has very major concerns about that and there are several things he would like to address. He stated he understood that the reason for the possible pull out of the merger was to save money and that is understandable. He stated Franklin County Health Department is about the same size as Fairfield County, but their budget is probably about ten times what his budget is so they do have advantages. Mr. Hirsch stated in 2009 Pickerington would pay around $89,000 and in 2010 that would be $90,000. He stated Franklin County had made a proposal where Pickerington would pay around $82,000 or $83,000, so the savings would be about $10,000 a year. He stated, however, there are several things they can offer and they can work with to almost match that amount. He stated the Board of Health would rather negotiate and try to rework the merger or rework some other arrangement so that the subsidy amount could be met and he felt they could meet or even beat what Franklin County would offer. Mr. Hirsch stated if Pickerington would pull out of the merger that would leave the rest of the County to either make up the difference or there would be drastic cuts, or a combination thereof. Mr. Hirsch stated further he felt Pickerington must consider what they are giving up as a legal authority. He stated when a nuisance occurs, a solid waste violation, or you have to condemn a house, we use the County Prosecutor and the County Prosecutor’s office in Fairfield County does not charge. He stated he is not sure what kind of an arrangement Franklin County has. He stated he would suggest Pickerington look to see which court system would be responsible for enforcing a lot of the nuisance complaints or other violations that occur. Mr. Hirsch further stated he felt the allegiance to Fairfield County comes into play as well. Mr. Hirsch stated you currently have a representative on the Board of Health that can help set policy for the County and you would not have that representative if you have a contract with Franklin County. Mr. Hirsch stated they were also looking at other sources of income, and while no one likes a levy in Fairfield County it would almost force the Health Department to seriously consider that in the future in order to subsidize their operations.

Mr. Sabatino clarified that Fairfield County has applied to be designated a federally qualified health center and once they were designated that would be a $500,000 grant every year. Mr. Hirsch stated you need to apply for the grant every year, but it is not a competitive grant, so it would be continuing. Mr. Hirsch stated also they would then be able to get enhanced reimbursement for Medicaid and Medicare. Mr. Sabatino stated Franklin County has offered to do plumbing inspections with a split of inspection fees and questioned if Fairfield County can offer that as well. Mr. Hirsch stated that was something that he believed could be considered. Mr. Sabatino stated if he had something to look at on an “apples to apples” basis it would help him make his decision.

Mr. Smith stated he would like to address Mr. Hirsch’s comment about the allegiance to Fairfield County, and Council was elected to represent the residents of Pickerington and do what is best for the residents. Mr. Smith stated his biggest problem with the current merger agreement is the financing, that it is not based on per capita but on property valuation. He stated when he looked at the services provided, they seem to be more related to per capita than to property valuation, and that is the biggest hurdle he has to get over in how the cost of a merged health department operates.

Mrs. Hammond stated she works with various organizations and in the last year there have been a lot of complaints about food licenses for the vendors at the different events. She stated this seemed to be an area that could be worked on because there have been some very unhappy people. Mr. Hirsch stated he knew of the complaints, and once they were made known they were able to be more flexible. He stated the bottom line is the protection of the public’s health.

Mayor O’Brien stated in order to give Fairfield County a fair shot at dealing with a budget cut or in order to give Franklin County notice either way, because March is the budget meeting for Fairfield County Board of Health, he would suggest that a decision be made and be on the next Council agenda. He stated if a first reading is done, that would give either Board of Health notice of the direction we intend to go so they would not have to wait. Mr. Hirsch stated that would be helpful and they would work with Pickerington because they want to do what is best for all of their constituents.

Mr. Sauer stated he had noticed that Franklin County does not offer the WIC program and he wondered if Mr. Hirsch knew how much that was utilized in this particular area of Fairfield County. Mr. Hirsch stated he did not have that information with him, but he could get it and forward it to Council. Mr. Hirsch stated even if a split would occur, Fairfield County would still be required to provide the WIC and vital statistics program. Mr. Sabatino stated again if Mr. Hirsch had something that they can look at to compare on an equal footing basis he would ask that it be provided in time to be utilized in their decision-making. Mr. Hirsch stated he would be glad to do that. Mr. Sabatino stated if he worked with Mrs. Fersch she could tell him exactly what they need.

Mr. Fix stated he appreciated Mr. Hirsch’s willingness to work with the City. He stated his biggest concern was Fairfield County’s long-term financial situation that they are faced with. He stated his concern was not the immediate financial situation or the services provided, but what would happen in 2010 or 2011 that changes their financial picture, that brings them out of the deficit situation they are in and allows them to pay the bills that aren’t being paid right now and still continue to provide all the services they are providing without going for a tax levy. Mr. Hirsch stated he was putting a lot of faith in the economic stimulus package and there are a lot of different sources of money through the Federal government you can apply for and hopefully get. He stated the clinic has been one of the biggest draws on their budget and now it is almost breaking even and when they receive the federal designation that will make it much easier. Mr. Paul Martin stated he is the President of the Fairfield County Board of Health and three of the Board members are residents of Pickerington.

Mr. Fix stated the budget expense subcommittee was charged with trying to find ways to reduce expenses for the City by either removing services or by outsourcing services. He stated this was one of the programs identified to outsource. He stated the bottom line was we wanted to save money, and what he has been hearing from the Fairfield County Board of Health is that they are willing to help us save money and meet or beat what Franklin County has offered. Mr. Fix stated this has since evolved into looking at services and what Fairfield County brings, what Franklin County has, and he felt that was a separate discussion. Mr. Fix stated a decision needs to be made on where we want to go and he did not feel they had all of the information they needed to make that decision. Mr. Fix stated his thought would be to ask Mrs. Fersch and Mr. Hansley to work with the Board of Health in structuring a 2010 contract that shows the financial gain we expect to get in making the transition, bring that back to this Committee, and call a special Finance meeting for next week. He stated once they can compare the proposals they can make an informed decision. Mr. Sabatino stated what he would like to do is get something specific back from Fairfield County and then make a value judgment based upon the specifics. He stated he felt Council needs to look at what is best for Pickerington’s citizens. Mr. Sauer stated he has heard a lot about the condition of the building the Board of Health occupies and questioned if that was going to be a cost that will be coming up down the road. Mr. Hirsch stated they are looking at different options. He stated they currently own the building and they are paying close to $200,000 a year on maintenance and utilities. Mr. Hirsch stated he felt they could go out and rent a smaller space and actually come out ahead. He stated again, he is just now starting to look at these options. Mrs. Sanders stated she would also like to get information that she can use as a comparison prior to making a decision. Mr. Fix clarified the Committee was asking Mrs. Fersch and Mr. Hansley to work with Mr. Hirsch and whoever they need to, to come back with a proposal that will match or beat the financial proposal received from Franklin County.

Mr. Fix stated he would like to schedule a Special Finance Committee meeting for February 17, 2009, at 6:30 P.M. for the specific purpose of a comprehensive review of the financial impacts of staying with Fairfield County or going with Franklin County Board of Health and the differences in services provided by both.

3. FINANCE DEPARTMENT.

A. Finance Director’s Report. Mrs. Fersch stated she had provided a written report to the Committee and she would answer any questions.

B. Review and request for motion to approve draft ordinance amending the 2009 appropriation, Ordinance 2008-92. Mrs. Fersch stated the Committee had received a draft appropriation ordinance and she would answer any questions. Mr. Smith moved to approve and forward to Council; Mrs. Hammond seconded the motion. Roll call was taken with Mrs. Hammond, Mr. Sauer, Mr. Sabatino, Mr. Smith, Mr. Fix, and Mrs. Sanders voting “Yea.” Motion passed, 6-0.

C. Review and discussion regarding financing options for Diley Road. Mr. Fix stated this was discussed earlier in the meeting.

D. Review and discussion regarding Franklin County Board of Health proposal. Mr. Fix stated this was also discussed earlier in the meeting.

4. PERSONNEL DEPARTMENT.

A. Personnel Director’s Report. Mrs. Fersch stated she had provided a report to the Committee and she would answer any questions. Mrs. Fersch stated the ad was in Sunday’s paper for the City Engineer and we have received two resumes as of today.

5. CHAIRMAN: Mr. Fix stated he had nothing to bring forward.

6. OTHER BUSINESS:

A. Pickerington Local School District Board Meeting – Update. Mrs. Sanders stated the District is finalizing the boundaries for the new school and working staffing.

B. Discussion regarding Lions’ Club Labor Day event. Mr. Sabatino stated he had provided the Committee with two e-mails last month and the members had also received a copy of the Police Chief’s estimate of an overtime cost of $1,155.75. Mr. Sabatino stated he felt the Lions Club has been here for over 60 years and they have demonstrated their involvement in the community. Mr. Sabatino stated he felt the City should waive the requirement that the Lions Club pay for the police overtime. Mr. Smith stated he felt the difference in this request from any other the City receives is the tangible benefit the City receives from the Lions Club. He stated Mr. Fox had presented a listing of actual dollars the Lions Club has put back into the community and he agreed they should not be billed for the police overtime. Mr. Sauer stated given the information provided to the Committee it definitely seems tangible benefits have been provided to the City by the Lions Club. He stated he did not have a problem with this request. Mrs. Hammond stated she certainly valued everything the Lions Club has done for the City; however, there are other organizations that have equally done things for the City. She stated she was not sure given our current situation that she would be comfortable with allotting this money for a parade. Mrs. Sanders stated she was torn on this issue since we did eliminate the Fourth of July celebration, and she would like to make sure the funds are there and that we wouldn’t be taking away from something else that should also be covered. Mrs. Sanders continued that if the money is there, she would be inclined to support this. Mayor O’Brien stated over the last year Council had talked about creating a sum of money that the City could afford, and then have the various organizations come in and make a presentation that was data driven. He stated he felt this is what the Lions Club has done, they have come in with hard numbers and no one else has. Mr. Sabatino stated he felt it was important to note that the Lions Club is not asking for any money, they are only asking not to be charged overtime for the police department. He stated some of the other requests we get are for actual hard dollar amounts. He stated since we do take in this bed tax, and he understood Mrs. Hammond’s concern about other groups, he agreed that we should take a percentage of that tax and reserve it for things like this. Mr. Fix stated Mr. Fox had presented a compelling argument that the Lions Club has made contributions to the City that are tangible in ways that other groups have not, and because of that he was inclined to support this. Mr. Fix moved to waive charging the Lions Club police overtime for the Labor Day event; Mr. Smith seconded the motion. Mr. Hansley stated staff is working on a special events application that will give credit for money going back into the community, is it a City event or co-sponsored by the City, etc. He stated there will be several questions on the application that will aid in determining what action should be taken. Mr. Sauer stated he hated seeing the fireworks eliminated and he would be glad to have this event this year. Roll call was taken with Mr. Smith, Mr. Fix, Mrs. Sanders, Mrs. Hammond, Mr. Sauer, and Mr. Sabatino voting “Yea.” Motion passed, 6-0.

7 MOTIONS:

A. Motion for Executive Session under Section 121.22(G)(1)b, Matters involving an employee’s or public official’s employment, Section 121.22(G)(2), Purchase or sale of public property, Section 121.22(G)(3), Conference with law director regarding pending or imminent court action, and Section 121.22(G)(4), Matters involving bargaining sessions with public employees. Mr. Fix stated an executive session was not required this evening.

8. ADJOURNMENT. There being nothing further, Mr. Sauer moved to adjourn; Mr. Smith seconded the motion. Mrs. Hammond, Mr. Smith, Mr. Fix, Mr. Sabatino, Mr. Sauer, and Mrs. Sanders voted "Aye." Motion carried, 6-0. The Finance Committee adjourned at 8:45 P.M., February 4, 2009.

RESPECTFULLY SUBMITTED:

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Lynda D. Yartin, Municipal Clerk