City Council Minutes

Mayor Johnson called the meeting to order at 7:00 p.m. in the Northville City Hall Council Chambers, 215 West Main Street, Northville, Michigan.

Present: Mayor Christopher Johnson, Mayor Pro Tem Carolann Ayers, Councilmembers Kevin Hartshorne and Jerome Mittman.

Absent: Councilmember Thomas Swigart (excused)

Also Present: City Manager Gary Word, Assistant City Manager/Finance Director Nicolette Bateson, DPW Director James Gallogly, City Clerk Dianne Massa, Police Chief James Petres, Fire Chief James Allen, Assistant Finance Director Sandi Wiktorowski, Assessor/Deputy Treasurer Jena Shepardson, Wayne County Appraisal/Assessor John McLenaghan, Police Chief James Petres, Parks and Recreation Director Traci Sincock, Police Detective/Sergeant Michael Carlson, Police Sergeant Dustin Krueger, and one citizen.

A. Citizen Comments

Larry Parks, 632 N. Center Street, questioned whether the budget document is available for public review and if the public could ask questions during the budget sessions. It was responded that the budget document is available for public review and checkout at the City Clerk’s office. Questions are welcomed at any time during the budget review.

Motion Ayers, seconded by Mittman to approve the agenda presented. Motion carried unanimously.

Overview and Revenues (pages II-2, 101-1, 101-6):

Assistant City Manager/Finance Director Bateson introduced the budget review session with an overview of the factors influencing the FY2005-2006 budget.

The amount of unlevied operating millage continues to be diminished due to the restrictions of Proposal A and the Headlee Amendment.

Despite the City’s efforts to control the millage rate, the Headlee limitation is quickly being eroded. This is due to the combined effect of how uncappings are handled with the combined effect of Proposal A and the General Property Tax Act. It is likely the City will reach the Headlee limitation within the next few years.

While property values continue to escalate, the increase in taxable values for FY2005-2006 are limited to 2.3% under Proposal A. The disparity between State Equalized Value (SEV) and Taxable Value is 26%. The percentage of general fund expenditures financed by property taxes, consistent with last year, is at 73%.

Historically, state-shared revenues have provided the General Fund with its second largest source of revenue. However, due to a slowdown in the economy, and the State of Michigan’s competing need for those funds, the City experienced a decrease in state-shared revenue in 2004-2005 and is not optimistic about increases in that revenue source for the next few years.

The FY 2005-2006 budget is based on an operating millage of 13.30 mills. The General Fund increased by 3.41%.

John McLenaghan, City Assessor, Wayne County Appraisal Company, pointed out several key facts regarding the property tax revenue.

The total assessed value of residential properties increased by 3.14%; the overall assessment change for all classes is 4.48%.

The taxable value for the community increased 5.08% to $344,444,025. The variance between the SEV and Taxable Value for total properties in the City is 26%.

With the Headlee Roll Back Formula, the current maximum millage rate for 2005 is 14.2988 mills.

The Assessors Office now values commercial and industrial properties using the equalizer program. Specialized neighborhoods for newer, larger homes were created, which assisted in developing more accurate assessments. Photos for almost every property in the City are now part of the assessment files. Sold properties are inspected to make sure the assessment records match the properties sold. Board of Review appeals increased slightly due to the new commercial and industrial assessments.

The following reports (included in the budget document) were reviewed: Sales Statistics for the Last Five Years, 2005 Tax Base Comparative Analysis, 2005 Tax Base Analysis/Taxable Value, 2005 Tax Base Analysis/SEV, Millage Roll-back Formula Analysis, Unlevied Operating Millage History and Projected Headlee Maximum, History of Millage Rates and Tax Base, Taxable Value History, and City Charter 9.1 Tax Limit.

A question was raised regarding the number of tax appeals made to the Board of Review due to hardship and the income level used when determining hardship. It was explained that a variety of factors in the federal guidelines, including property owner income levels, are used when determining hardship cases. It was also stated that the City is more generous than the federal guidelines.

Discussion ensued relative to the long term plan goal stated on page 101-2 of the budget document. The goals states, in part, that the long term plan is "…to continue to provide a high level of service to the community, implement capital improvements as necessary, and set the millage rate at a steady or decreasing amount…" There was reluctance to support this statement at this time. It was felt the Council should approach the budget with an open mind until the budget sessions are complete, and the Council had knowledge of the needs of the community and the status of all revenues. It was countered that, due to the Headlee Amendment, this statement is viewed as a general goal in which the City states it will remain fiscally conservative, while acknowledging that future adjustments might be necessary.

There were questions pertaining to the percent increase in expenditures for Elections (page 101-5). It was responded that the proposed budget includes reallocating a portion of the election clerk wages from the City Clerk’s budget to the Elections budget to accurately reflect how staff time is spent; federally mandated election equipment upgrades, which will be funded in part through grant funds; and the costs to administer the school district elections. The grant funds and the school district election costs have offsetting revenues recorded in the revenue section of the proposed budget document (pages 101-10, 101-12).

Questions were raised relative to the unallocated reserve (page 101-5). It was noted that the increase in the unallocated reserve is due to unknown wage adjustments for the non-union group and the one remaining bargaining unit still in contract negotiations, as well as the "unforeseen."

City Staff responded to questions from City Council on the proposed FY2005-2006 and five year projected budget. Key items, questions, and discussion included:

City Council (page 101-13): Minimal decrease from the current year budget; the budget supports important City memberships, community contributions and relationships. The budget provides for $2,500 for both FY2005 and FY2006 (for a total of $5,000) for the 50^th Anniversary Committee’s planning of commemorative activities to recognize the City’s 1955 incorporation.

City Manager (page 101-16): Increase from the current year budget due primarily to fringe benefit costs. The increase in conferences and meetings (five year projected budget) is due to the location and cost of the international City Manager’s conference.

Elections (page 101-18): Proposed increases are due to reallocating a portion of the election clerk wages from the City Clerk’s budget to Elections to accurately reflect how staff time is spent; federally mandated election equipment upgrades as required by the Help America Vote Act (HAVA), to be funded in part through grant funds; and the costs to administer the school district elections. The grant funds and the school district election costs have offsetting revenues recorded in the revenue section of the proposed budget document.

City Attorney (page 101-21): Proposed budget provides for a nominal increase in attorney fees. Overall general and prosecution legal services budgets are at levels consistent with prior years.

Discussion pertained to outstanding litigation costs, negotiated prosecuting attorney rates, and the billing process.

City Clerk (page 101-23): Decrease from current year budget due to reallocating a portion of the election clerk’s wages and fringes to the Elections budget to more accurately reflect how staff time is spent.

Discussion pertained to the cost of staff time in responding to Freedom of Information Act (FOIA) requests.

Finance and Administrative Services (page 101-25): Increase from current year budget primarily due to increases in fringe benefit costs.

Discussion ensued relative to automatic payment of tax bills and it was responded that this service might be available in July.

Taxation / Tax and Assessing (page 101-28): Increase from current budget primarily due to increases in fringe benefit costs. Tax and assessing information continues to be the highest source of activity on the City’s website. Staff time will focus on expanding additional information available online.

Questions pertained to offering online payment services. It was responded that online payment services require a third party, usually a credit card company. The convenience fee is often high; usually a 3 – 5% fee. It was felt this convenience fee was excessive and would not be well received by the residents. Staff continues to explore other options that would not include this fee. Further discussion pertained to reevaluating building and land ratios, which is done so that each property has accurate assessment information on file.

Building and Grounds (page 101-30): Decrease from current year budget due to a reduction in expenditures for general operation and maintenance from previous years. This includes elimination of dust control and tree work in cemetery, reduction of cleaning at City Hall from 5 to 3 days per week, no window cleaning, and limits on city-wide tree trimming and removals.

Discussion pertained to the importance of maintenance and that eliminating routine maintenance will result in future higher costs. It was requested that the budget be revised to reinstate routine maintenance such as window cleaning, cemetery dust control, and tree trimming and removals.

Additional questions and discussion pertained to the landmark tree removal permits, revenues for new trees, the reserve account specifically marked for new trees, Our Lady of Victory’s (OLV) contribution to the new tree fund to replace trees removed as part of their school expansion project, and the need for a document that outlines OLV’s plan for replacing trees, which would include the proposed tree replacement location, replacement tree size, and replacement tree species.

Police (page 101-34): The proposed budget provides for a continuation of most of the services currently provided. Additional funding was included for firearms range rental, in-car video tape replacement, and the purchase of two new patrol vehicles. The Oakland County 800 MHz radio and CLEMIS system project upgrades continue.

Questions were raised pertaining to the bike patrol and it was suggested this service be reinstated on a more regular basis as it is valuable public service that allows police officers to be out of their cars and on the street. It was responded that filling this detail schedule is difficult due to two vacancies, as well as staff injuries and family leaves.

Discussion ensued relative to the walk-in traffic at the police department after hours. Staff continues to record this number and will present a report to City Council for a recommendation on the need to staff the police department for after hours walk-in traffic.

It was requested that Staff provide a qualitative and quantitative report on the joint dispatch and lock up operation, including the number of City dispatch calls compared to the total dispatched calls.

Discussion and questions regarding:

use of City lock up (currently used for storage);

video cameras at the police department window (no internal camera system at this time);

the purpose of CLEMIS fees (fee is part of the advantage of being in the CLEMIS system);

the purpose of the amount budgeted for "Court Appearance – Prisoners Housing" (the City is responsible for the per diem rate to house prisoners for City violations);

budgeted amount for the replacement of two patrol vehicles (future budgets will propose earmarking funds in the police budget in a reserve account to purchase patrol vehicles when needed);

overtime costs (seasonal, depending on the racetrack as well as coverage for court appearances, civic events, covering shifts due to sick calls and vacations, and call-in pay driven on staffing levels and contractual obligations);

the purpose of the line item "compensation time"(part of base pay; line item shows where their time was spent)

Fire (page 101-46): The proposed budget remains in line with the current budget. A portion of the Building Department clerical wages and fringes were reallocated from the Fire Department to the Cemetery portion of the budget to more accurately reflect how staff time is spent.

Technology (page 101-49): Current budget reflects a continuation of multi-year projects, including: 1) implementation of Document Imaging System Phase II, 2) continuation of City website and e-government planning, and 3) continued evaluation of long-term goal of becoming a "24 hour city hall" via the Internet. The GIS project is delayed due to Wayne and Oakland County budget constraints and limitations on City staff time to devote to this project. The City continues to earmark a small amount of funds for this project so that the City is ready to participate when the opportunity arises and for staff training to remain current on the topic.

Discussion and questions pertained to the funds included in the proposed FY2006-2007 budget for network and computer upgrades.

Larry Parks, 632 N. Center Street, noted that the City has an excellent website, which has received high ratings. A question was raised relative to the "hit list" report. It was responded that City Council will receive a technology update next month and that hit list information will be added to the City’s website. Council requested the report include information on the number of City News subscribers.

Department of Public Works (page 101-51): Proposed budget provides for a level of service consistent in previous years.

Discussion and questions pertained to the analysis of the street lighting costs for both gas and electric power sources. During FY2004 and FY2005, the increased cost for gas over electric was over 6%. It was noted that Consumers Energy comes out twice a year to relight and clean gas fixtures. In between these maintenance visits, the City (DPW) is responsible for lumen adjustments, attempting to relight burned out fixtures, fixture cleaning, and replacing damaged and knocked down light poles.

Further discussion focused on the Michigan Municipal Risk Management Association (MMRMA) and Michigan Municipal League (MML) Electric Choice programs. In the past, setbacks in each program, due to legislative action and threats from the power companies, have made the programs less attractive. Staff will re-explore each program to see if joining would be beneficial to the City.

Larry Parks, 632 N. Center Street, questioned if the electric light fixtures were metered. It was responded that the fixtures were not metered and that DTE charges per fixture based on lumen output.

Planning, Zoning, and Inspection Services (page 101-55): The proposed budget provides for a consistent level of services. A portion of the clerical position’s wages and fringes were allocated to the Fire Department and Cemetery sections of the budget to reflect how staff time is spent.

It was noted that the Building Official’s routine office hours has improved.

Shared Services (page 101-58): This budget will be reviewed in detail during the April 11^th budget session.

Contributions to Other Funds (page 101-60): Current year activity consists of an operating transfer to the Local Street Fund (#203) to support operating activity, an operating transfer to the Public Improvement Fund for the payment of an installment purchase contract principal, and an operating transfer to the Fire Equipment and Replacement Fund (#402) to add to the reserve for future equipment replacement.

Discussion and questions pertained to the contributions to the retention fund for the City’s insurer, Michigan Municipal Risk Management Authority (MMRMA).

Debt Service (page 101-62): Proposed budget provides for annual debt service payment for the final payment for the 1990 Street Improvement Program general obligation bonds, the 2000

public safety bonds, Parks and Recreation installment purchase loan reimbursed to the General Fund, and the final payment for the City Hall copier installment purchase.

Insurance, Central Supplies, and Unallocated Reserves (page 101-64): The proposed budget reflects the costs to participate in a risk management pool, costs dealing with office supplies, copy machine supplies, office equipment maintenance, and postage. The unallocated reserve provides for unusual and unforeseen expenditures.

It was explained that the loss reserve established to cover deductibles and uninsured losses is a "trust in agency" fund through MMRMA.

Fire Equipment and Replacement Fund (page 402-1): The fund allows for the purchase of up-to-date equipment to meet current standards. Consistent with the 20 year plan, there are no purchases for FY2006.

It was noted that the FY2005 Thermal Imaging Camera and Exhaust Removal System projects were funded through federal FEMA grants with a 10% local match. Once received, the Fire Department will demonstrate the new thermal imaging camera at a future City Council meeting.

It was also noted that the Utility Rescue Unit received a write up in one of the national publications.

A. Mayor and Council Communications

Mittman noted that the concerns mentioned by users of the Senior Community Center during the March 7^th City Council meeting were reviewed by the Senior Citizens Advisory Council. The seniors did attend the meeting and Mittman met with the seniors after the meeting to explain how their concerns would be addressed.

B. Staff Communications None

There being no further business to come before Council, the meeting was adjourned.

Respectfully submitted,

Dianne Massa
City Clerk