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2004-37-Minutes for Meeting January 07,2004 Recorded 1/14/2004COUNTY OFFICIAL TES NANCYUBLANKENSHIP, COUNTY CLERKS COMMISSIONERS' JOURNAL Il01/14/1004 11;46:56 PM uuu um.lInaim ■ aMIR 2004-37 DESCHUTES COUNTY CLERK CERTIFICATE PAGE This page must be included if document is re-recorded. Do Not remove from original document. Deschutes County Board of Commissioners 1130 NW Harriman St., Bend, OR 97701-1947 (541) 388-6570 - Fax (541) 388-4752 - www.deschutes.ora MINUTES OF BOARD MEETING DESCHUTES COUNTY BOARD OF COMMISSIONERS WEDNESDAY, JANUARY 7, 2004 Commissioners' Hearing Room - Administration Building - 1130 NW Harriman St., Bend Present were Commissioners Michael M. Daly, Dennis R. Luke and Tom De Wolf. Also present were Mike Maier, County Administrator; Susan Ross, Commissioners' Office; Les Stiles, James Ross, Larry Blanton, and Sue Brewster, Sheriffs Office; Tammy Credicott, Property Management; Mark Pilliod and Laurie Craghead, Legal Counsel; and Marty Wynne, Finance Department. Also in attendance were Steve Scott, the County's Real Estate Broker of Record; media representatives Barney Lerten of bend. com and The Bugle, Chris Barker of the Bulletin, and Jeff Mullins of KBND Radio; State Representative Gene Whisnant; and three other citizens. Chair Mike Daly opened the meeting at 10:00 a.m. 1. Before the Board was a Decision regarding a Litigation Issue. The following action follows an executive session discussion held earlier in the day regarding Wisdom v. Deschutes County. DALY: Move that Legal Counsel be authorized to proceed with negotiations on the terms of a settlement according to the earlier discussion with Legal Counsel in executive session. DEWOLF: Second. VOTE: DEWOLF: Yes. LUKE: Yes. DALY: Chair votes yes. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 1 of 24 Pages 2. Before the Board was a Decision regarding Real Estate Negotiations Issue ("Elliott property"). DEWOLF: Move that the County's Real Estate Broker of Record and County staff proceed in securing the property and draw up an addendum for the Board's signature, as discussed in executive session. LUKE: Second. VOTE: DEWOLF: Yes. LUKE: Yes. DALY: Chair votes yes. 3. Before the Board was a Decision regarding Real Estate Negotiations Issue (Sale of County -owned Property to the City of Redmond). DEWOLF: Move that the County's Real Estate Agent of Record (Steve Scott) and County staff negotiate the sale of the County's 122.8 acres (located within the City of Redmond's urban growth boundary) with City representatives, according to the parameters discussed in executive session, and report back to the Board with the final negotiations. LUKE: Second. DALY: I have a comment to make. I am very much objecting to the part "including the agent of record" in the negotiations on this. The agent of record has not been involved in this issue up until just the other day when he was brought in by Mike Maier for negotiations. I think we have three lawyers working for this agency, and we have a real estate department. The issue is very cut and dried. I can't imagine why we need an agent of record to be involved in this. If, for some reason he is involved, I would suggest that he proceed under his contract where he is being paid $100 per hour for his advice. That's the way I feel about it. LUKE: As strange as it may seem, and this is probably the first time I've disagreed with you on an issue, the agent of record has been involved with this property ever since I've been here, since he's been under contract with the County. He has worked different aspects of this and hasn't charged us for most of that work. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 2 of 24 Pages This is not a simple, cut and dried, straight real estate deal; it's complicated. We talked quite a bit about it over the last few days. Tammy (Credicott) is not a licensed real estate agent. We made that decision quite a while ago because of the liability that the County would assume if she were a licensed real estate agent. And it takes more than just an agent, because an agent doesn't have the knowledge of a broker. You need somebody with that knowledge to make sure, since this is a complicated deal. And I'd like to make sure it goes through. The agent of record has proposed that he get I%, since some of the negotiations of this are a counter-offer to increase the price for different things. I think the original number that he put out, I believe it was $17,000 something, should be the commission. And he should move forward and get this thing done. PILLIOD: I realize a lot of this is yet to be fulfilled, but I think the idea was that it would be contingent upon a sale. LUKE: It's contingent upon a deal. As always. DEWOLF: I agree with Commissioner Luke. We do not have a real estate department, as you said, Mike. We have a property management department, and Tammy's responsibility is managing the properties that we have. When we have simple sales, she handles them. We've had a lot of those that go out to public bid and what have you. It's these complicated pieces that we were originally looking at in a very different direction for this piece of property. Steve's been working to prepare that property for sale, and would have been the agent of record, and it would have been a 10% commission on bare land. I think this is more than fair. He has worked his tail off on this property for us. For the five years that I've worked with Steve in this position, and the years prior to that when I've worked with Steve when he and Jim Crowell lead the effort to raise the money to restore the old downtown gym for the Boys and Girls Club, he's been a part of this community since he was a little kid. And I think he knows the community and that knowledge serves us as a County so well, having someone like Steve as our real estate agent of record. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 3 of 24 Pages I don't think we're tossing any bones here; I think we are saving money here. I want to maintain that good relationship with Steve for as long as he is our real estate agent of record. Take his personality completely out of it. I want to treat our real estate agent of record fairly so that if Steve is no longer in that position, that we will still have other people who will want to be our real estate agent of record because we do treat people fairly for the work they perform for us. If we were going out and buying and selling property and using a real estate agent every time, we would spend a fortune. Much more than we have spent in the years we have had Steve under contract. He has saved the taxpayers of this County a lot of money, and he's doing so again on this. I'm going to support Dennis and the I% commission on this piece of property. LUKE: It should be 1% of the original offer. MIKE MAIER: The only thing that has been proposed is adding the $17,000 and change for the environmental cleanup work. There would be no commission on the participation amount either. DALY: I have another question. I'm not through. We have a contract with an agent of record. In that contract, there are two ways to go. He either gets a commission if he has it listed, or he gets a payment of $100 an hour for his advice. Now, I'm talking about this piece of property. Not all of the other things you're talking about. DEWOLF: I'm talking about this piece of property. DALY: I'm talking about this piece of property. Has he got a listing on this piece of property? PILLIOD: I don't believe so. Okay. Has he ever asked for a listing on this property? Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 4 of 24 Pages PILLIOD: I don't know. DALY: According to the contract that we have with the real estate agent of record, the only option he has to get paid on this is the $100 an hour that is included in there for his participation in the negotiations. PILLIOD: Under the contract we currently have. DALY: Thank you. TAMMY CREDICOTT: Tammy Credicott, property management -- DALY: I haven't asked for any further discussion yet. LUKE: I would like Tammy's input, please. DALY: But -- LUKE: Mike, you're Chair, not a dictator here. Okay. There are three Commissioners here. Tammy, could we have your input, please? CREDICOTT: It's my understanding that this would be treated like any other property, and at the time we are ready to negotiate we would sign a listing agreement with Steve. Similar to the Elliott property. So at this point we would sign a listing agreement stating the I% commission. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 5 of 24 Pages DEWOLF: And we have had different percentages on the real estate fee on different pieces of property throughout this. If we were going to - what we have been doing with Steve over the last few years on this piece of property is preparing it to sell. And whether we were going to do all of that work ourselves, or now that Redmond has finally decided that they want to buy it, to have them do it - either way, it was moving towards the point where we would be signing a listing agreement with Steve Scott. And if we would have just gone forward the way we were, it would have been at 10%. This is a hell of a deal. PILLIOD: It sounds to me as though the County has established a bit of a practice of specifically negotiating particular listing agreements on individual pieces of property, which amounts to an amendment to the contract that he has. I mean, if we are talking about, strictly speaking a listing, bare land sale, it would be 10% or an hourly consulting fee. Tammy has now mentioned that on a case by case basis we enter into a listing agreement with Steve and adjust the percentage or the fee. Then as a matter of law, the contract and practice, we have established precedent for allowing particularized fees based upon particular cases, incidents, sales and transactions that we have with him. LUKE: I'd like to point out that on the Lafayette properties he actually charged us less commission than he was entitled to, which was actually a change in the contract, too, because he wasn't paid what the contract said he was entitled to. PILLIOD: Certainly. There's nothing that prevents the Commission from asking the real estate agent of record to quantify in some fashion the effort and time that has been brought to bear on this to this point. That doesn't mean that he is entitled to the fee we are now talking about; that's a decision you are about to make one way or the other. You could require some narrative or statement that sets out more particularly why this amount, $17,000 and change, is a fair amount, given the history and the transaction. That's entirely up to the Commission at this point. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 6 of 24 Pages DALY: I think that it would be entirely appropriate. I mean, we are talking about $17,000, and basically he only entered into this situation with the City of Redmond on this particular deal yesterday. As far as I know, he spent a total of a couple of hours in a meeting here. To pay the man $17,000 of public money just because he was brought in at the very last minute of these negotiations, is absurd. I think, I've talked to Mayor Alan Unger about their realtor of record, and was told that they have kept him out of it since this is a deal between two public entities. They didn't want to involve him. So, you've made your motion, and if you want to do this, it's up to you. I don't have the votes to change it. I do think that Steve ought to give us something in writing to justify this expenditure. It's public money and I believe that anytime we are going to spend that kind of public money, it ought to be justified. DEWOLF: And if he had entered into this yesterday, I would agree with you. But I reject your notion that he entered into this yesterday. He has been working for us on this piece of property for years, preparing it to the point where we could sell the property. That is the facts. Now, you can reject that if you want, but that's your problem, not mine. We have never before said, hey, Steve, on every real estate deal where you are going to get a contract at some point, where we are going to sign a listing and you are going to get 10% if it is commercial or bare land, or 7% if it is residential, we also want you to keep track of your hours. That has never been done before. He was working towards getting this ready to a point where he would have probably multiple listings because it would have been multiple pieces of property once we partitioned it and then subdivided the property. And each one of those would have had a commission of 10%, as the contract calls for. The fact is, we changed our minds. We changed the decision; he did not. We are the ones who changed this. And for you to say that yesterday is the first time he has been brought into this particular deal isn't fair. There's a certain way that you can squirrel through and make that an accurate statement because yesterday is the first time that we received an offer from the City of Redmond. In that very narrow way of looking at it, you could say that's the first time on this particular part of this deal that Steve's been brought in. But he has been working on it for years, with the full expectation that we would honor our end of our bargain with him. And I intend to do so. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 7 of 24 Pages DALY: If he has been working on this for the last four years, I would suggest that he could probably put that in writing, and everything that he has done to get the property ready. I think Legal Counsel is correct, that we ought to have some kind of backup information before this commission is paid. DEWOLF: I'm going to call for the question. DALY: Okay. Could I have the motion read back? (The original motion was read back to the Commissioners.) LUKE: I withdraw my original motion. DEWOLF: I withdraw my second. LUKE: I move to direct staff, including the agent of record, to negotiate and do a counteroffer with the City of Redmond on the 122.8 acres; and that the real estate agent of record be paid $17,220 in commission for a completed transaction. If there's no deal, there's no commission paid. DEWOLF: Second. VOTE: DEWOLF: Yes. LUKE: DALY: (Split vote.) Yes. Chair votes no. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 8 of 24 Pages 4. Before the Board was a Discussion of Document No. 2004-006, an Intergovernmental Agreement between Deschutes County and the Cities of Sisters, Redmond and Bend regarding the Defense of the Revised Population Forecast (if Appealed). Laurie Craghead explained that this is a preemptive agreement. The last time the forecast was challenged, the cities did not intervene. The planners suggested that in the case of an appeal, the cities should agree to intervene and share in the cost of defending the forecast. This document has not yet been presented to the cities formally, but they are aware of it. Commissioner DeWolf asked what constitutes "adequate" findings. Ms. Craghead said that this would be determined by LUBA (the State Land Use Board of Appeals). DEWOLF: Move approval. LUKE: Second. VOTE: DEWOLF: Yes. LUKE: Yes. DALY: Chair votes yes. 5. Before the Board was a Discussion of the Upcoming Sheriffs Levy. DALY: Are we going to make a decision on the levy today? Is that the plan? LUKE: That would be my hope. DEWOLF: Mine, too. 1x0,114 i Whatever the decision is, the campaign has to be put together and people organized. The sooner, the better. LES STILES: With me are Undersheriff Larry Blanton and Business Manager Jim Ross. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 9 of 24 Pages There have been a number of public meetings over the past eight weeks. There have been reams of paper and a host of documents presented. Bottom line, at one of those meetings I heard what I thought might be a consensus in terms of at least an operating levy rate. There remains some debate as to whether it should be three or five years. But in the end, what I heard was essentially two options. One option was maintaining our current .78/1.12 rate, which we've been on for seven years. As a result of that rate, each year for the last three years we have systematically taken our unappropriated ending down from a high at one point of $2.3 million to this year, where the latest estimate is around $345,000. I think that's highly optimistic and doesn't take into account the ballot measure that we are going to vote on in a couple of weeks. Independent of that, the bottom line is that it is clear that this rate has not, and will not sustain our current level of operations, much less take care of our future needs. The other rate that I have heard some discussion on during our meetings was a rate of .82 for the urban area and 1.60 for the rural area, which would be an increase of .04 for urban residents and .48 for the rural. That said, what I've done is work with staff to prepare a financial and operational scenario. (Copies of the document were distributed at this time. A copy of the document is attached as Exhibit A.) Scenario #1 is .82/1.60. Scenario #2 is .78/1.129 the current rate. Scenario #3 is, what are the consequences if the levy fails. There are risks in any decision we make, regardless of the rate. Those risks should be clearly identified up front, and not seen somewhere down the road in April or whenever as being some type of "you're just saying this because" as a scare tactic. JIM ROSS: The three columns represent the following. The first column is the levy rates at .82/1.60, which we consider a rate that sustains our current operations. The second column is the current rate, .78/1.12. The third column is what I call our doomsday scenario - what happens if the tax levy fails. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 10 of 24 Pages The numbers in red means a change from the previous scenario. So we're starting at .82/1.60. Then we're showing what changes when we go to .78/1.12. Obviously, under the resources side, we go from resources of $18,118,000 at the .82/1.60, and we fall to $16,100,000 at .78/1.12. And that's simply because our tax revenue would be less at the lower rates. Then, going to the column where the tax levy fails, we would get no tax revenue from the current year, so that's a decrease of $12 million. We would end up getting $6 million of funds from the collection of room tax and from other services that the Sheriff has contracts for, such as the City of Sisters and the 1145 funding for inmates. STILES: Before you move on, Jim, you'll see that throughout this, at the bottom there is going to be an asterisk, not only on this document but the following document where there is a narrative of what each of these means. Everything is predicated on our current level of funding for 1145. Should anything disrupt that, be it Ballot Measure 30, be it the new legislative session, or the possibility that some of the counties will opt out. Based on the house bill for disappropriations, if the measure fails in three weeks, which means a $26 million cut, or $780,000 to Deschutes County, $325,000 to us, it may trigger what we already saw last years when Lane, Marion and a number of counties opted out. LUKE: Did anyone opt out entirely? STILES: They retracted. They submitted their letters to the Department of Corrections, but the legislature put back in exactly the amount to not trigger opt out, so they withdrew their letters. I think that yo-yo is creating a level of frustration in other counties besides ours. DEWOLF: You have one year during which you can withdraw. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 11 of 24 Pages STILES: As long as the state has taken no substantive steps in furtherance of your opt out. Frankly, the last legislature clearly understood, and demonstrated that by putting $30.6 million back into DOC. They understood clearly what the consequences are. The State cannot afford to have all of the county prisoners dumped back into their lap, when they have neither the resources nor the staff to deal with it. What will happen in July is a wild card, but I wanted to make sure that these figures clearly show the wild cards that we cannot predict or forget. LUKE: There could be a big void of leadership in some of these issues with the new legislature. The .82/1.60 is the current service level?, STILES: That will be exactly what we have today, and not a single thing more. No work center and no additional deputies. What that means as a practical matter is that we will start what I call "the City of Bend gradual decline". This is where you have increasing population, static staff, increasing demands for service, decreasing customer service, decreasing ability to clear crimes and to do the kinds of things you want. It will be a gradual shift. The first two years it will be almost unnoticed. In years three, four and five, if we go to a five year levy, I think you'd see a more dramatic drop. LUKE: What's your recommendation, three or five years? STILES: Well, that depends. One of the items we discussed in our public meetings in the past was the idea of this blue ribbon committee reinvestigating the concept of permanent tax districts, and trying to resolve some of the philosophical issues around how we allocate costs. The intent I believe was that this committee would attempt to bring this issue forward in two years. If that's the case, and there is a serious commitment to move on that, I would suggest three years. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 12 of 24 Pages Frankly, with a five year operating levy at this rate, years four and five are going to start seeing us doing the same kinds of things we've been doing for the last three years in terms of financial resources. LUKE: So, your recommendation is? STILES: We're going to be really scraping the bottom of the barrel at .82/1.60 in years four and five. I would recommend a three-year levy if we are going to take a substantive step toward the formation of that blue ribbon committee that Tom talked about. We should actually start on that right now and take it to the voters in May of 2006. I know that the City of Sisters and the City of Redmond definitely want a seat on that. If that were going to be done, I'd say three years. In terms of operational stability and the impact on morale in our agency and the ability to do what we need to do on a continuing day to day basis, obviously five years is better. Permanent is the optimum. MIKE MAIER: Can you do both? Five, and proceed post haste with this? STILES: We can, and Legal Counsel assured me that we can vacate at the moment the permanent tax districts come into being. DEWOLF: You would have two years left on your levy, and people might say, why should I vote for this change now. STILES: Bingo. Plus the fact that the only five-year levy that Deschutes County has ever presented to the voters failed. Five years is a long time, and if there's a substantial change, and I think it's a risk, by moving from three to five, we're taking a risk. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 13 of 24 Pages DEWOLF: You've got another huge issue here. That is, none of the four of us agree that this is the right way to go. STILES: Which might make it a perfect solution. DEWOLF: It could be. But it's only for the short term. The reason for the blue ribbon committee is to try to get it away from being all of the elected officials dealing with this, and including law enforcement from the three areas and interested citizens from throughout the County to go to work on this, have a healthy debate, and really look at and dig out the evidence. As I contend, there's a huge benefit to having a Sheriff s office for city residents as opposed to what is being presented, that City residents are paying too much. I know it's a huge compromise for you, and it's a huge compromise for me. That's the only reason I am interested in going forward, is the agreement that we have this committee go to work on this right away and put this on the ballot in two years. The only way that I am interested in that personally is a three-year levy. I think a five-year levy takes all the incentive out for moving towards a permanent levy, where we need to get. LUKE: So a three-year levy would take effect in July of 2004, through June of 2007. So you would vote in 2006, probably November. If it goes down, it would give you an opportunity to pass another serial levy. STILES: Exactly. It gives us a nine-month window and the opportunity to reevaluate. There are two major benefits. One, it gives us that nine-month window to start looking at a new rate, so we'd be back where we are today. Plus, it would also give us the opportunity to evaluate the rate itself. I remain very concerned about what I believe is an effective compromise rate for years four and five. It will also give us the option to evaluate what's happening after the first two years, especially if our growth rate and demand curve keeps going in the direction it's going. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 14 of 24 Pages MAIER: I'd like to compliment Jim on this document. It is really good information. We've had a lot of big spreadsheets, but this really helps. JIM ROSS: The main thing is to look at the consequences of keeping the rates at the current level. There are some major consequences. LUKE: I believe the citizens of Deschutes County have a good relationship with the Sheriffs Office. I've been at fires with you people and know how you work with other agencies. I hear very little bad comments from the public regarding the relationship your deputies have with the general public. You have a very high quality staff. The level of service that we're at right now I think the citizens of the County expect. I would have a problem supporting a rate that would significantly reduce that level of service. I think the public should have an opportunity to vote on a rate that at least maintains the level of service they have right now. There is no increase; we're not reopening the work center now. We should at least try to maintain the level of service we have now. STILES: I concur with that. Even that will result in a gradual decline in service. Cutting anything will just exacerbate that. What isn't shown here is that if we keep it at .78/1.12, July 1 of this year we will have to lay off 19 people. The following July we will have to lay off additional people, and will continue layoffs each year for the life of the levy. If it fails, we will have to lay off 112. LUKE: There have been discussions as to city residents versus rural residents, but to me they are all County residents. And that will discussion will continue. This is a major compromise for all of us. DALY: At the last meeting we had to talk about the rate, you thought maybe we were all on board. I think I said I wanted a week to think about it. I didn't make a decision at that time. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 15 of 24 Pages When I came back after thinking about it, and we're talking about this rate of 1.60/.82, what this does is basically jump the rural folks' cost per thousand almost .50 a thousand, which is a huge jump. I'm thinking about the older, retired people and fixed income folks who live in La Pine, and all over the County, that basically can hardly make it on what they have now. Suddenly they are going to have to pay more. Also, we have schools putting levies on the ballot at the same time, to try to get additional money. The combination of the two is going to make a huge hit. I agree, I would really like to see the Sheriff have permanent funding. I agree with this blue ribbon panel, and think that we need to go forward on it. I agree with a three-year levy. I'm worried that if we put the .82/1.60 on the ballot and it fails, then we end up in this right hand column. I think to play it safe, I would rather see the .78/1.12 go on the ballot. I think you have a good chance of it passing. Obviously we would lose people and everything else. But to me it doesn't put us into the right hand column. I think you do a great job, and if we can get to a permanent funding system, I'll support that 100% at a rate that's equal throughout the County. But the three-year levy at the current rate, that's playing it safe. That's where I'm at. I think we should play it safe and not get over into the right hand column and lose all police services if the levy fails. STILES: Mike, I hear your concerns and understand them. We gave that a great deal of thought. We did not come in asking for a rate without recognizing the consequences. The flip side is that when we made our decision, one of the responsibilities and duties of the Sheriff is public safety. And when we were looking at this, this past calendar year alone I've already laid off 24 people at our .78/1.12 rate. I shut down the work release center, I triggered matrix in the jail, and we've got an OMNI Group study telling us and giving us a pretty clear picture of what they believe is coming in the years 2005, 2010 and 2015. We're the fastest growing county in the state. When you get behind the curve -- in my experience with the City of Bend, they were going to annex the 11,000 to 14,000, whatever it was, City management clearly understood that there were consequences and said they must hire 23 officers. They never did it. They now sit at 63,000 with the lowest staffing ratio of police officers in the state of Oregon for municipal agencies. I have seen their demand curve go up, and I've seen their customer service curve go down, and I can't in good conscience recommend that. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 16 of 24 Pages If we stay at .78/1.12, we will cut 1/3 of our patrol positions. There will be dramatic consequences and we will never catch up. Then, if you try to catch up, what is the rate we'd be looking at in three years? Will the impact be any less then than it is now? I know it's a tough choice, and know these are tough times and I recognize that we are looking at tough issues. But I have faith that the voters will choose what is in their best interest. I'm very sorry that we are going to see competing interests pitting education against public safety on the same ballot. We all live with the consequences of Salem. We all live with the consequences of the perceptions of the people in Salem. I'm sorry that we are at the point we're at. The fact of the matter is, I can't in good conscience recommend staying with a rate that I know is going to substantively cut and make the pain that much greater in three or five years. LUKE: I don't relish going out with a higher rate. If we could maintain current service levels with the existing rate, I'd be there. I don't look forward to going out and campaigning for this because of the rate increase. But I do look forward to the fact that you have a high level of service and people expect that. I think personally that they should be given the opportunity to vote, to see if they are willing to pay for that. If they're not, then we go back in September and adjust the rate. I think we can make the case for this, that you need this money, it doesn't go into the general fund but goes directly for Sheriff services. I think we can make the case that this money is needed to maintain the current level of service. LARRY BLANTON: You know, almost a year ago we started a strategic plan at the Sheriff s Office. It's our job as administration to support and assist the Sheriff with potential upcoming issues with a growing county like this. That strategic plan identified some issues that we need to keep up with the current level of service and demand for service. We need to increase employees, equipment, materials and service. That's not going to happen. The .82/1.60 is a concern to me as to how long we can keep providing the same level of service. We shouldn't be at the .78/1.12 today. We can't live on that rate. It's because of very good financial management in the Sheriff s Office that we can still push patrol cars down the street at that rate. We can't continue to do that. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 17 of 24 Pages Mike, I agree with you. Our concern is about the older folks and retirees, and who is going to answer the 9-1-1 calls. If we're not careful, there won't be anybody to answer those calls. It's a concern and an issue we have struggled with. We have cut costs, we have pinched pennies, and that's what is demanded and rightfully so by the public to make sure we are getting every drop of juice out of a penny, and we've done that. We're at the end. We've done some creative things with scheduling, with cutting vehicle fleets, and with cutting personnel to make sure we have adequate staff responding to 9-1-1 calls. We can't put people out there by themselves. I'm concerned, and we lay awake at night thinking about it. It's a proactive approach. That's our job, to identify in a proactive way upcoming issues. It's our job to try to stay up with a study that the County paid for about potential upcoming issues. This isn't just the Sheriff s Office we're talking about. If we have to cut and make adjustments in the jail and how we receive prisoners from the cities of Bend and Redmond and outlying entities, it's going to affect their level of public safety as well. If I were the Chief of Police in Redmond or Bend, I would tell my people not to adjust what they are doing on the street. Continue to arrest the same number of people for the same crimes, and let the Sheriff sort it out at the jail. It's the County's responsibility as soon as they come in the door. There is a huge issue with potential liability if we don't continue to provide enough money to make sure we stay out of hot water when we are providing this service. DEWOLF: I want to clarify one thing. The 24 positions that were lost were certainly not all due to the .78/1.12. There was a lot of 1145 money lost as well. STILES: The 1145 money was the straw that broke the camel's back. But it was not the sum total. We could have absorbed some of the 1145 loss from the State of Oregon and continue to scale down the work center. The aggregate of the .78/1.12, lack of revenue, 1145 and a host of issues is what resulted in that. DEWOLF: Each of the three of us has a problem. And that is, we each need two votes to do anything. And I can't get two votes for what I would do today. What I would do is to go forward at $1.24 for everybody. That's what I would do. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 18 of 24 Pages I think that when we created this split rate, we created something that was a shot in the dark. We didn't have the evidence to support it then, and we don't have the evidence to prove it now. I think you, Jim, came up with the 1.24 as the number that would adequately preserve what we have now if we had it across the board. I can't get a second vote to do that. So I'm forced to either go with what Mike or what Dennis wants to do. They're both in the same position. The thing that this does is move in a direction that I don't want to go. It moves in the direction that reduces the city residents' portion of this entire levy. Currently, at .78/1.12 the city rate is at 69% of what the rural rate is. At .82/1.60, the city rate is 51% of what the rural rate is. That's a big jump in that gap, and it goes against what I believe. The only solace that I take in this compromise is that when we started out the original proposal was at $2.85 for rural areas, and it's now at $1.60. That's $1.25 per thousand lower than where we started. The problem that I have, Mike, with the position of staying at .78/1.12 is that we have moved in this direction for the past three years with a budget that all three of us and the other three members of the budget committee have approved. We've allowed this unapprorpiated balance to drop each year, knowing that this day was coming, and knowing that those rates would need to rise. I live in the City of Bend. I know there's more crime in the city. I should pay more to be safe, because it happens. I mean, I've had crime take place at my home as many people have. I've had it take place at businesses that I have owned, as many people have. You know what, I save in other areas because I don't have to drive as far, it's not as expensive for a variety of services that I'm able to access, and it's my hunch that on balance, it's pretty fair. There are obviously people who disagree with that, and I respect that. That's the reason that I think it's critical that we form this committee to look at all those issues. To listen to what I have to say, to listen to what Allan Bruckner has to say. We've been friends for a long time and when we disagree we still stay friendly, but argue the facts of these issues. That's what I hope will continue to take place. What this compromise does in my opinion is buy us some time. It buys us the time to get a permanent district on the ballot at a rate that we can agree to. I'm willing to be proven wrong, but I want evidence. And I hope you are all ready to be proven wrong based on the evidence that is brought to this committee during the next eighteen months. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 19 of 24 Pages I look at a .48 per thousand increase in the rural area on a $150,000 home being $72 per year. For some people that is a lot of money. For others it is no big deal. It's a difficult pill to swallow at all because of the difficulty with tax issues. The one thing that I guess I would offer up is that we at Deschutes County have been very frugal. We've built the Becky Johnson Center in Redmond, the Human Services building in Bend, and we're putting up the new office building to share with the State -- we've done that without going to the taxpayers for additional dollars by the way that we've been able to work with other government entities and save money in other areas to make those things happen. When Dennis and I were here the first two years, we levied less than the full rate that was allowed by law. I think we were the only municipality in the State of Oregon to do that. We left money in people's pockets. I guess what I'm saying is, now we're asking people to dig a little bit into their pockets. I'll be honest with you; this is against my own self-interest. As a city resident, if I went with your most optimistic deal, my rate would drop and I'd save some money. Dennis and I would both benefit by doing that. Mike, you don't live in a city so this impacts you in a much more negative way than it does us. The thing is, none of the three of us are doing this because of our self-interest. We are looking out for what we believe is best for the people in the County. Even though I don't like this rate and don't agree with it, I respect the fact that you disagree with me and we've got more work to do to get to a place where we can all be on the same page. I think what this does is move in the direction that those who disagree with me wanted to see this go. It puts more on the backs of rural residents than it does on city residents, but it still has what I think is an adequate increase for city residents. It's a 5% increase for city residents and a 30% increase for rural residents. But I will vote to put this on the ballot at .82/1.60 with a three-year levy. I think we need to have the fire on all of our feet to put this working group together to study the issue and make a recommendation for a rate for a permanent tax district. This should begin right after the election. It should have a good representation of law enforcement people and citizens, with wide geographical representation, socioeconomic representation, gender, age, and that we really put together a matrix that will consist of a good group of people committed to the hard work that this is going to take. In May of 2006 we should have permanent districts on the ballot so we can get out of this mess that we've been in. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 20 of 24 Pages LUKE: There is a difference in the amount of money that a penny brings in the urban and rural areas. What is that? ROSS: It's approximately $40,000 per penny in the rural areas, and $70,000 per penny in the urban areas. LUKE: I would move that staff be directed to prepare the language to place a levy on the May ballot for three years at a rate of $.82 in the urban areas and $1.60 in the non -urban areas. DEWOLF: I would go for March to give us a window to come back in May. But since I can't get support for that, I'll second your motion. DALY: Anyway, any more discussion? I want to be sure everyone has a chance to say their piece before this vote happens. The only thing I've got to say is that I will vote against it, simply for the reasons I stated before. I just don't think we have the climate for any kind of a tax increase. The February election will give us a good indication of how people feel about increasing taxes. I support the Sheriffs Office 100%, but just want to play it safe and make sure we don't lose Sheriffs services. LUKE I appreciate it. I went to some of the town halls with the Sheriff, and at the one in La Pine, the people who attended there were very supportive of paying additional money to maintain their services. They don't want a decrease in services. I think Terrebonne is the same way. We are going to have to go out and justify it. But it's about public safety for the citizens of Deschutes County, and I'm willing to go out a work on it. DALY: I hope I'm wrong. I hope the citizens will support you. But I can't in all- good conscience support the .50 increase in the rural areas. It's a huge increase in one step. I have a problem with that. I just can't support this. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 21 of 24 Pages BLANTON: Anything we do here is a risk. It would certainly be nice, and I would ask you to reconsider, if we had the full support of the County Commission instead of having to answer questions about why it was a two -to -one vote and us having to answer issues relating to this. DALY: I appreciate your concern. As I said before, in this issue I hope I'm wrong. l don't think I am, and I'm afraid we're probably going to lose at the ballot box. hope I'm wrong. STILES: If we do, the consequences are clearly laid out. DEWOLF: We've been going down this road for years, like I said before. The one thing that I believe is that without public safety in our communities, everything else falls apart. When we get to budget time, I don't look at individual departments and keeping them whole; we look at an entire system. Public safety is one key component, just like mental health is. When it comes time for voting, consistently our voters have supported public safety because people don't like to be scared and people don't like to be threatened in their homes or out shopping or driving on the roads. Mike, I hate this. I am disappointed that you won't support this, because for me personally I'm really biting the bullet to agree to go along with this. The philosophy is wrong. But I'm willing to set that aside because I believe so much that we have to maintain the service levels that we have out there. And it's not just the growing population; it's the growing tourist population. I mean, we have 15,000 people a day here on average; 365 days a year, and they do not live here. All of that combined together puts so much pressure on not just this department but the cities as well. They are critically important to keeping everyone in the cities safe, too. I hope that when all is said and done that what we see when we come to a permanent district is one flat rate for one district countywide. I'm willing to see something else happen as a result of an intensive study of the benefits to city residents. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 22 of 24 Pages Although I appreciate the fact that you disagree with it, so does Dennis and so does Les. But we're going to support this thing. STILES: I'd like to make one final comment. I strongly support your idea of a single common rate. We are the only county in the state that exists to the degree that we do on the split operating rate levy. When the idea first came up, I know it wasn't this Board, the consequences are, in every other county the tax rate for the county includes public safety services. In our case, that would be represented by the $1.24. And you'd still be one of the lowest taxed counties around, even if you added the $1.24. The real question becomes, that would be the optimum solution. It takes away this whole issue of who gets what and who it is designed for, from the standpoint of allocating dollars. DEWOLF: What I'm saying, bottom line, is that we will be asking the voters to give us these three years of a little bit higher rate than they want to pay so that we can get through a good, solid, reasonable process with a blue ribbon committee to help us make a good decision on permanent districts. That's what I'm asking. If someone is paying an extra $72 a year, there will be three years of that. That's what we're asking people to do. I think that is reasonable in this case. DALY: The question has been called for. Any further discussion? VOTE: DEWOLF: Yes. LUKE: Yes. DALY: Chair votes no. (Split vote.) This meeting was continued to 1:30 p.m. Continued.- Present ontinued: Present were Commissioners Michael M. Daly, Dennis R. Luke and Tom DeWolf,- also present were Mike Maier, County Administrator; Anna Johnson and Judith Ure, Commissioners' Office; Mark Pilliod, Legal Counsel; and media representative Chris Barker of the Bulletin. Minutes of Board of Commissioners' Meeting Wednesday, January 7, 2004 Page 23 of 24 Pages 6. Before the Board was a Discussion of the Selection of a Federal Lobbyist to Represent the County. The Commissioners, Mark Pilliod and Judith Ure gave an overview of the feedback they had received from references they had contacted about the three federal lobbyist finalists. After a lengthy discussion, and noting that the choice was very difficult to make, the Board came to a conclusion on their selection. DEWOLF: Move approval that a one-year contract be entered into with The Ferguson Group. DALY: Second. VOTE: DEWOLF: Yes. LUKE: Yes. DALY: Chair votes yes. Being no further discussion or items brought before the Board, the meeting adjourned at 2:45 p.m. DATED this 7th Day of January 2004 for the Deschutes County Board of Commissioners. ATTEST: Recording Secretary Minutes of Board of Commissioners' Meeting Page 24 of 24 Pages Dennis R. Luke, Commissioner Tom DeWolf, Commissioner Wednesday, January 7, 2004 Deschutes County Sheriff's Office Financial and Operational Scenarios Levy Rates at $.82 and $1.60 Levy Rates at $.78 and $1.12 Tax Levy Fails Resources $18,118,521 $16,100,301 $6,161,846 Requirements Operating $18,118,521 $16,100,301 $6,161,846 Non -Funded Employee Liability $75,481 $421,103 FTE Funded 171 152 59 Sheriff's Staff Sworn Positions Captain & Undersheriff Captain & Undersheriff Captain & Undersheriff Non Sworn Position Six staff working 5 day weeks Reduce Staff Reduce Staff & Work Days Automotive Communications FTE Manager/Mechanic/Techni cian Manager/Mechanic/Techni cian Manager/Technician Number of new vehicles purchas Thirteen Eight None Investigations/Evidence Captain 60% Code, 40% Investigations and Management 60% Code, 40% Investigations and Management 60% CODE, 40% Evidence/Civil Detectives Six Six None Sergeants Two Two Forensic Sgt only who also handles evidence CODE Detectives Two Limited, if detective I positions cut None Major Crimes Rape, Robbery, Homicide Rape, Robbery, Homicide Patrol responsibility if available Evidence Handling & Storage Two Technicians Two Technicians Captain & Forensic Sgt Patrol/Civil/Traffic Patrol Teams Four Teams with 11 Deputies per Team 24 hours per Day Four Teams with 9 Deputies per Team 24 hours per Day. Reduction in Patrol hours. 4 Staff Sisters, 6 Staff other areas working 16 hours per day civil duties and emergency response if available Response Time 30 minutes or less Significantly Reduced Emergency calls only, response time unknown K-9 Four Deputies lFour Deputies None Civil Service One Full time Tech & Deputies Deputies only Captain, Lieutenants & Sgts Traffic Team Four deputies, one sergeant Four deputies, one sergeant None Code Enforcement One Law Enforecment Tech One Law Enforecment Tech None Animal Control Four Law Enforecment Tech None, No response to calls None, No response to calls SRO's Four Deputies None, no longer participate None, no longer participate Substations LaPine, Sisters, ITerrebone I LaPine, Sisters, ITerrebone Closed January 6, 2004 Exhibit 19 Page ( of Z Deschutes County Sheriffs Office Financial and Operational Scenarios Levy Rates at $.82 and Levy Rates at $.78 and Tax Levy Fails $1.60 $1.12 Adult Jail/Transport/Court Securi Total Beds 228 228 108 Four Teams with ten Four Teams with ten Four Teams with 5 Deputies Deputies, one Sergeant & Deputies & one Sgt. No and one Sgt *(see note) One Program Deputy Program Deputy Corrections Deputies Four Deputies Four Deputies None, Transport perfomed by Mgmt (Undersheriff/Captain) Transport/Court Security Limited Limited Religious required, Reduce NA, AA & GED Inmate Pro rams Inmate Transport As Requested and As Requested and Limited, done by Deputies available Deputies available Undrsheriff/Capt, Medical emergency reduced Increases risk of litigation Contract with Aramark Contract with Aramark Aramark may opt out of contract requiring remaining staff to provide services Kitchen Services Inmate Release Increase use of Matrix due Increase use of Matrix due Focus will be to lodge most to overcrowding in Jail to overcrowding in Jail serious criminals. Estimate arrestees from local law enforcement agecies for lodging maybe booked and Impact of other Law Enforcemen None None Longer waiting period booking inmates Laundry, cleaning etc Laundry, cleaning etc No inmate work program Inmate Work Program Control Room Upgrade Limited maintenance No capital improvements Jail Maintenance *(note)This does not assume any further reductions of S131 145 funds (High Risk) Emergency Services Emergency Manager (Grant Fun Funded lFunded Funded Special Services/SAR Funded Funded Forest Service and SAR Sergeant 50% Title III Funded Office Assistant 80% Title III Funded Funded Funded Operational Operational Severely limited operations SAR Two Deputies Two Deputies Not Performed unless Marine Patrol & USFS patrol services contracted Training Funded Funded No Programs, Sergeant moves to Adult Jail Training Sergeant Notes: Jail po ulation is estimate only Aramark Contract status is unknown Could have impact on Juvenile Immate worker program changes need to be defined January 6, 2004 Exhibit Page of Z