Loading...
HomeMy WebLinkAbout2010-04-19 Work Session Minutes Deschutes County Board of Commissioners 1300 NW Wall St., Suite 200, Bend, OR 97701-1960 (541) 388-6570 - Fax (541) 385-3202 - www.deschutes.org MINUTES OF WORK SESSION DESCHUTES COUNTY BOARD OF COMMISSIONERS MONDAY, APRIL 19, 2010 ___________________________ Present were Commissioners Dennis R. Luke, Alan Unger and Tammy Baney. Also present were Dave Kanner, County Administrator; Erik Kropp, Deputy County Administrator; Dave Inbody, Assistant to the Commissioners; David Givans, Internal Auditor; Marty Wynne, Finance; Susan Ross and Teresa Rozic, Property & Facilities; and Hillary Borrud of The Bulletin. Chair Luke opened the meeting at 1:30 p.m. 1. North County Campus Financing & Feasibility. Dave Kanner explained that the State pays $1.42 per square foot for leased space at four different locations, and the leases expire next year. Central Oregon Intergovernmental Council is also leasing at this time. Both agencies are willing to work with the County on a new location to consolidate their services. The building would be need to be about 40,000 square foot, with room for future expansion. Therefore, if something is to be done in conjunction with the State in regard to a new facility, this is the time to act. Bond rates are very low and it is, in general, a good time for this kind of endeavor. It puts local residents to work and will benefit Redmond. The real question is whether the County can do this. Commissioner Luke asked about the differences between building new or buying and remodeling. Commissioner Unger replied that some has to do with traffic impacts and location. The employees are already affecting the system, so SDC’s would be the difference. Commissioner Baney said that some are interested in the Evergreen School site. Mr. Kanner stated that the City of Redmond might be interested in this location, in conjunction with a private developer. Minutes of Board of Commissioners’ Work Session Monday, April 19, 2010 Page 1 of 5 Pages Minutes of Board of Commissioners’ Work Session Monday, April 19, 2010 Page 2 of 5 Pages He said that funding has been set aside for a north County campus for some time, as it was a stated Board goal. (He referred to a handout regarding the Projects Fund and Cash Flow Projections.) There would be about $1.5 million available for this project. COIC would also like to occupy the building. With that lease and those of the State agencies, about $5.25 could be bonded. It would cost about $8 million, so approximately $1.25 million would need to be borrowed. (He provided a handout with loan and debt assumptions.) Commissioner Unger asked if perhaps the State employment agency could be included along with the Department of Human Services, as they have a synergistic relationship with State employment. Mr. Kanner stated that the County needs 15,000 square feet, and an additional 15,000 or more within 20 years, depending on the economy. As is the case with other buildings the County shares with the State, over time the State picks up more of the cost, which reduces the debt quickly. Mr. Kanner said that the information shows clearly that the County can afford to do this. Commissioner Luke stated that when 1300 Wall Street and the OSP/911 buildings were built, times were much better. He said that he has a problem with putting in new buildings in competition with the private sector. The County will have to find and purchase ground for this purposes before the State will commit. Susan Ross said that if a State agency partners with another agency, they no longer require a full competitive process. Mr. Kanner stated that they do not have to go out to bid if they are leasing. Commissioner Baney asked if $1.42 a square foot is too high in the current economy. Ms. Ross said that the State likes to partner with the County and wants to consolidate their departments, as does the County. Mr. Kanner suggested that there are some properties that might work already, based on a previous solicitation, and they could be asked to provide a formal document. Commissioner Unger feels there is only one building that is big enough to accommodate all of this. Otherwise, the County will have to build. Ms. Ross stated that there are advantages and disadvantages to one or two story buildings, whether to remodel or build, and so on. Minutes of Board of Commissioners’ Work Session Monday, April 19, 2010 Page 3 of 5 Pages Mr. Kanner said that his goal is for the County to pay in cash and repay itself over time. Finance Director Marty Wynne prefers to borrow it all in case something else comes up that requires cash. He said that something might come along years from now and the time might be good then to do something with cash rather than borrowing. Commissioners Unger and Baney support moving forward. Commissioner Luke said that he has a problem with competing with the private sector, where there is a lot of vacant property. He understands, but feels that everyone should just get by at this time. He feels the money may be needed for operations. Commissioner Unger stated that it is a positive, adding jobs and infrastructure. If they are looking at a downtown location, now is the time to do it while there are adequate choices and the prices are low for labor and materials. Commissioner Baney said that she wants to proceed with moving forward. Mr. Kanner stated that they could look at what is out there to satisfy just the needs of the County, and also look at the larger picture. Also, instead of borrowing, they could use project development funds. However, the Board had already considered that for offsetting jail bed expenses. 2. Health Benefits Trust Projection and Recommendations. Mr. Kanner said that there are an infinite number of scenarios regarding this projection. (He referred to a PowerPoint presentation at this time.) If charges are not raised and they have another challenging year like last year for several years, the negative amount could be bad. A similar year of claims costs is not likely. “Scenario D” was discussed at this time. The worst-case scenario is that no payments change and there are no savings, and claims remain high. Mr. Kanner said that the average nationwide increase in health costs is about 9% a year. Mr. Wynne stated that at one time the fund had to be subsidized. It was determined that it would be budgeted at the average stop loss amount, plus about 30%. Mr. Kanner said that the plan is not a Cadillac but a Chevy. They would raise departmental charges by 8%, but that would be partially offset by PERS. There are a couple of funds where there would be a small increase. At their first meeting in January, the PERS board changed how to determine the rate. They limit rate increases in each biennium. There just has to be enough in reserves to get the County through four years. Minutes of Board of Commissioners’ Work Session Monday, April 19, 2010 Page 4 of 5 Pages The other element is that raising the health benefits amount does not get it to the right place. He would like to use $65 as s the wellness incentive amount. If someone does not enroll in the health wellness program, it stays there instead of going down to $50. They will establish health assessment programs, which will push people to be more responsible with their health. Mr. Wynne said that Scenario D reflects an 11% increase annually in claims, and the wellness program and on-site clinic are included. This evaluation should take place every year, projecting out five years. If the employee increase were raised 8.3%, it would be on line with other agencies. (Mr. Kanner presented a comparison study of what other jurisdictions are paying.) Discussion occurred about what percentage the employees pay and what the deductibles are. There is a variety of programs and it is hard to compare the different plans. Mr. Kanner noted that the three-month run-out means you have to have enough to cover three months. More will be presented tomorrow at the EBAC meeting. 3. Audit Committee Appointments. David Givans reviewed the recommendations. One position is required, and two others would be optional. The Commissioners like the idea of having all three on board. (Chris Earnest, Jean Pedelty and Jennifer Welander). UNGER: Move that all three be appointed. LUKE: Second. VOTE: UNGER: Yes. LUKE: Chair votes yes. 4. Update of Commissioners’ Meetings and Schedules. Commissioner Unger said he is working with COIC regarding transportation issues. The latest proposal is a partnership with COIC and Redmond to establish a maintenance facility for Cascade East Transit and the City. This would consolidate operations.