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BUDGET, FINANCE & INVESTMENT COMMITTEE
April 4, 2002 6:15 P.M. Courthouse
MINUTES:
Members Present: Others Present: Others Present: Others Present: Comm. Joyce Ealy Evans Maples Steve Smith Jim O’Keefe Comm. Paul Johnson Tommy Sanford Regina Nelson Katie Lynch Comm. Tina Jones Judge Don Ash Jeff Sandvig Lisa Glenn Comm. Steve Sandlin Tracy Hill Tim McLaughlin Paul Long Comm. Dwight Throneberry Tommy Brown John Davis Elaine Cawthon Comm. Jimmy Evans, Chair. Ginny King Alfred Smith
Chairman Evans presided and called the meeting to order with six members being present.
Approve Minutes:
The minutes of the March 7, 2002 meeting were presented for approval. Comm. Sandlin moved, seconded by Comm. Throneberry to approve the minutes as presented. The motion passed unanimously by acclamation with Comm. Peay being absent.
INVESTMENT REPORT:
Mr. Evans Maples, Trustee, presented the monthly Investment Report for the information and use of the committee. Mr. Maples advised that 93.22% of the property taxes have been collected as compared to 92.61% for the same period last year. Mr. Maples advised the LGIP interest rate for the month was 1.93%. He explained the investment transactions that occurred during the month. Comm. Ealy moved, seconded by Comm. Jones to approve the Investment Report as presented. The motion passed unanimously by acclamation with Comm. Peay being absent.
FUND CONDITION REPORT:
Finance Director Paul Long presented the Fund Condition Report for the month ending March 31, 2002. Mr. Long advised the Development Tax collections for the month of March were $233,250. The year-to-date collections totaled $2,502,000 as compared to $1,760,250 for the same period last year. Mr. Long reviewed the Fund Cash balances. He noted the Road & Bridge Department has transferred $2,000,000 from the ending fund balance to the General Capital Projects Fund to fund the new Highway Department Facility. Mr. Long noted the Employee Insurance Fund is showing some improvement, and he hopes to be able to pay back the $1.5 million note in the next few weeks. He advised the committee that the liabilities in the fund at any given time are between $2.6 million and $3 million. He reported there is still a fund deficit. He reported there would probably need to be a premium increase built into the budget effective January, 2003. The total cash balances are $120,588,806, with $87,490,888 being operating funds and $33,097,918 being borrowed funds. Mr. Long reviewed the
remainder of the revenue and expenditure report. He advised there is still a
cash flow problem in Fund 121, which was established to account for the grant
programs. He explained that Budget Minutes April 4, 2002 Page Two
only 9.18% of the projected revenue had been received from the Federal Government. He reported the Domestic Violence Coordinator is doing an excellent job in requesting her funds on a monthly basis. He reported he has sent the Sheriff a letter advising him of the status of the law enforcement grants. He stated the revenue is approximately $65,000 behind on the law enforcement grants. He advised there were no other unusual conditions to report at this time. A discussion was held regarding the cash balance in the Manson Pike project, as well as the Blackman Furniture & Equipment and the Blackman Middle School and Rock Springs Middle School. Comm. P. Johnson moved, seconded by Comm. Sandlin to approve the Fund Condition Report as presented. The motion passed
unanimously by acclamation with Comm. Peay being absent. REAPPRAISAL PLAN THROUGH TAX YEAR 2006:
Mr. Tommy Sanford, Property Assessor, addressed the committee regarding the four-year Reappraisal Plan for 2006. He advised his department had to submit a reappraisal plan to be approved by the State Board of Equalization. He reported the plan has to be approved by the County Commission, signed by the County Executive, and forwarded to the Division of Property Assessment before it goes to the Board. Mr. Sanford explained the budget requirements to complete the visual inspection for fiscal year 2003 is estimated to be $327,043. For fiscal year 2004, the estimated budget is $405,275. For fiscal year 2005, the estimated budget is $429,348. For fiscal year 2006, the estimated budget is $769,001. The grand total for all four years is $1,930,667. Mr. Sanford requested approval of the Resolution authorizing a continuous four-year reappraisal cycle, and to forward the same to the full commission. The committee discussed the number of additional personnel that would be needed over the four-year period. Mr. Sanford advised the reappraisal plan included three additional personnel over the four-year period. Mr. Sanford advised the county has been receiving grant funds from the state to help toward reappraisal. However, the state is now considering this grant money has non-recurring funds, and Rutherford County may lose that. The Finance Director advised the cities would have to pay their share of the amount lost from the state. He stated approximately 35% of the parcels are outside the unincorporated areas. Therefore, the cities would have to pay half of the remainder of the cost. Following discussion, Comm. P. Johnson moved, seconded by Comm. Throneberry to approve the four-year Reappraisal Plan for 2006 and to forward to the full commission a resolution authorizing a continuous four-year reappraisal cycle. The motion passed unanimously by roll call vote with Comm. Peay being absent.
GENERAL FUND BUDGET AMENDMENTS
PROPERTY ASSESSOR: Mr. Tommy Sanford requested approval of the following budget amendment from the Property Assessor Account to the Board of Equalization Account to provide adequate funding for the hearings to be conducted by the Board of Equalization due to the reappraisal:
Budget Minutes April 4, 2002 Page Three
From: Property Assessor 101-52300-106 – Deputies - $4,310 To: Board of Equalization 101-51210-191 – Board & Committee Members Fees - $4,000 101-51210-201 – Social Security - 250 101-51210-212 – Employer Medicare - 60
Comm. Jones moved, seconded by Comm. Throneberry to approve the budget amendment as requested. The motion passed unanimously by roll call vote with Comm. Peay being absent.
ARCHIVES: Finance Director Paul Long requested approval of the following budget transfer for the Archives Department to provide adequate funding for the Postal Charges Account: From: 101-51910-709 – Data Processing Equipment - $150 To: 101-51910-348 – Postal Charges - $150
Comm. Paul Johnson moved, seconded by Comm. Ealy to approve the budget transfer as requested. The motion passed unanimously by roll call vote, with Comm. Peay being absent.
CIRCUIT COURT JUDGE: Judge Don Ash was present to request approval of the following budget transfer to provide funding to connect to the County computer network to improve communications with County offices and between Circuit Court personnel. Judge Ash advised none of the judges are on the County’s internet. He reported he has included this in next year’s budget for every judge, but this transfer will provide County internet for himself, his judicial assistant, and his court officer/law clerk. He advised it would also allow for the purchase of a computer for the law clerk:
From: 101-53110-719 – Office Equipment - $1,869 To: 101-53110-709 – Data Processing Equipment - $1,869
Comm. Sandlin moved, seconded by Comm. Jones to approve the budget transfer as requested. The motion passed unanimously by roll call vote, with Comm. Peay being absent.
ANIMAL SERVICES:
Ms. Tracy Hill, Animal Services Director, requested approval of the following budget transfer to provide adequate funding for the Communications Account for the remainder of the fiscal year:
From: 101-55120-357 – Veterinary Services - $4,500 To: 101-55120-307 – Communications - $4,500
Comm. Jones moved, seconded by Comm. Ealy to approve the budget transfer as requested. The motion passed unanimously by roll call vote with Comm. Peay being absent.
AMBULANCE SERVICE: Mr. Tommy Brown, Ambulance Service, requested approval of the following budget amendment to appropriate $34 received from teaching a CPR course at the Rutherford County Board of Education and
Budget Minutes April 4, 2002 Page Four
to appropriate donations in the amount of $500 from Pack’s Towing & Recovery and $25 received from a transported patient:
Increase Revenue: 101-43990 – Other Charges for Services - $34 Increase Expend.: 101-55130-196 – In-Service Training - $34
Increase Revenue: 101-44570 – Contributions & Gifts - $525 Increase Expend.: 101-55130-599 – Other Charges - $525
Comm. Sandlin moved, seconded by Comm. Throneberry to approve the budget amendments to appropriate the $34 received from the Rutherford County Board of Education and the donations in the amount of $525 as requested. The motion passed unanimously by roll call vote with Comm. Peay being absent. Mr. Brown requested approval of the following budget transfer to allow for the purchase of a truck for the Maintenance/Custodial employee. They have been utilizing a retired ambulance that has over 150,000 miles, but this vehicle became very unreliable and was in need of constant service and repair: From: 101-55130-307 – Communications - $21,788 To: 101-55130-718 – Motor Vehicles - $21,788
Comm. Sandlin moved, seconded by Comm. Ealy to approve the transfer to purchase a truck for the Maintenance/Custodial employee as requested. The motion passed unanimously by roll call vote with Comm. Peay being absent. Mr. Brown requested approval of the following budget transfer to purchase a basic copy machine for the Telecommunications Center and to provide a service contract for the copier: From: 101-55130-708 – Communications Equipment - $4,800
To: 101-55130-719 – Office Equipment - $4,476 101-55130-312 – Contracts w/ Private Agencies - 324
Comm. Sandlin moved, seconded by Comm. Throneberry to approve the request for the copy machine and the service contract as requested. The motion passed unanimously by roll call vote with Comm. Peay being absent.
APPROVE HAZARDOUS MATERIALS PLANNING GRANT FOR EMERGENCY MANAGEMENT: Mr. Steve Smith, Emergency Management Director, advised the committee of an 80%/20% Hazardous Material Emergency Planning Grant received from the U. S. Department of Transportation. The total amount is $7,012 with the Federal Government share being $5,610, and the County’s share being $1,402. He advised the funds would be used to purchase equipment for the program. Mr. Smith requested approval of the following budget amendment to recognize the federal revenue, as well as a transfer for the County’s 20% match:
Increase Revenue: 101-47230 – Disaster Relief - $5,610 From: 101-54430-499 – Other Supplies & Materials - $1,402 To: 101-54430-790 – Other Equipment - $7,012
Comm. Jones moved, seconded by Comm. Throneberry to authorize the County Executive to execute the Grant Agreement between the State of Tennessee, Department of Military, Tennessee Emergency Management Agency and Rutherford County for the Hazardous Material Planning Grant and to approve the budget amendment recognizing the revenue and the transfer for the 20% County match as requested. Budget Minutes April 4, 2002 Page Five
The motion passed unanimously by roll call vote with Comm. Peay being absent. SHERIFF’S DEPARTMENT: Chief Regina Nelson requested approval of the following budget amendments to appropriate $2,946 received for Commissary Sales to Prisoner Clothing, $335 received for stall rentals to the Mounted Patrol, and $6,050 received for donations for the Mounted Patrol and the N.E.T. program and the memorial gardens:
Increase Revenue: 101-44131 – Commissary Sales - $2,946 Increase Expend.: 101-54210-441 – Prisoner Clothing - $2,946
Increase Revenue: 101-44120 – Lease/Rentals - $ 335 Increase Expend.: 101-54110-399 – Other Contracted Service - 335
Increase Revenue: 101-44570 - Contributions & Gifts - $6,050 Increase Expend.: 101-54110-399 – Other Contracted Service - $6,050
Comm. Sandlin moved, seconded by Comm. Ealy to approve the budget amendments as requested. The motion passed unanimously by roll call vote with Comm. Peay being absent. APPROVE AMENDED CONTRACT BETWEEN RUTHERFORD COUNTY AND TENNESSEE DEPARTMENT OF HEALTH: Finance Director Paul Long advised the committee that the Health Department Director was requesting to add two full-time RNs effective April 15, one part time RN effective April 15, and one Nutritionist effective June 10 to the State contract. He advised the contract between Rutherford County and the Tennessee Department of Health would need to be amended to include these positions. He also explained Account 55190, Other Local Health, had sufficient funding to cover these positions without any budget amendments. Following discussion, Comm. Jones moved, seconded by Comm. Throneberry to approve the amended contract between Rutherford County and the Tennessee Department of Health to add two full-time RN’s effective April 15, one part-time RN effective April 15, and one nutritionist effective June 10 as requested. The motion passed unanimously by roll call vote with Comm. Peay being absent. REQUEST FOR FUNDING TO PROVIDE AIR CONDITIONING FOR VARIOUS SCHOOL GYMNASIUMS: Mr. Jeff Sandvig addressed the committee requesting $600,000 in funding to provide air conditioning for the last nine school gymnasiums that are not currently air conditioned: Christiana Elementary, McFadden Magnet, LaVergne Primary, Walter Hill Elementary, Old Eageville, Smyrna High, LaVergne High, Central Middle and Riverdale High. The committee discussed whether this request was a “want” or a “need”. Chairman Evans stated there would be other “wants” and “needs” that may be a higher priority. He stated the air conditioners would probably be installed in the summer and would not be ready until the fall. He stated if the request was postponed a year, due to the uncertainty at the State and the uncertainty of the sales tax revenue and other revenue, it might not be detrimental. It was discussed that the Riverdale High School gym had an air conditioner that was provided by a parent, and it was not big enough. Oakland High School was not on the list, and it was discussed if Oakland’s gym was air-conditioned, why Riverdale’s gym was not air-conditioned.
Budget Minutes April 4, 2002 Page Six
Following discussion, Comm. Throneberry moved, seconded by Comm. P. Johnson to deny the request and review it again next fiscal year after the budget is approved and see how the revenue situation stands. The motion passed by roll call vote with Comm. Sandlin voting “no”, and Comm. Peay being absent. REQUEST FOR FUNDING FOR ROOF REPAIR/REPLACEMENT AT VARIOUS SCHOOLS: Mr. Sandvig requested funding in the amount of $1,723,500 for roof repair/replacements for four buildings in the following priority order: 1. David Youree - $325,500 to replace a large portion of the school. It can’t be repaired because the old roof contains asbestos. 2. Central Middle Annex - $185,000, replacement, the roof is old and leaking badly. 3. Adult Education Building - $36,000, replacement, the roof is old and leaking. 4. La Vergne High - $1,177,000, the roof is sixteen years old and was built for a 10-year roof. There are many roof problems and heavy leaking exists on the school.
Mr. Sandvig advised when most of Central Middle was replaced last year; it did not include the annex. It was discussed if the roof replacement at the Adult Education Building also included the Maintenance Building. Mr. Sandvig stated he believed it was just for the old Board of Education Building. The committee discussed that at a cost of $36,000 for the Adult Education Building for 6,000 square feet, that would be a cost of $6 per square foot. The committee questioned if this was an accurate estimate. The roof replacement for David Youree at $325,500 for 84,000 square feet would be $3.89 per square foot. The committee also questioned if this was an accurate estimate. Following discussion, Comm. Throneberry moved, seconded by Comm. Sandlin to defer action on the $1,723,500 for the roof repair/replacements and to send the request back to the Health & Education Committee for further review and to request that Tim McLaughlin be present to explain the cost estimates. The Health & Education Committee to forward a recommendation back to the Budget Committee. The motion passed unanimously by roll call vote with Comm. Peay being absent.
RECOMMENDATION TO PROVIDE FUNDING FOR DRAINAGE STUDY: Mr. John Davis, Planning Director, addressed the committee regarding a recommendation by the Public Works Committee to appropriate $150,000 to start a drainage study contingent upon Murfreesboro, Smyrna, La Vergne and Eagleville participating financially on a pro-rata basis. Chairman Evans asked if a pro-rata share was discussed? Mr. Davis advised that no pro-rata amount was discussed. The Finance Director stated it was his understanding it would be based on either population or square miles. Mr. Davis noted it would probably be best to base it on square miles. It was discussed that a drainage study of the entire county could cost an estimated $1.5 million. Mr. Davis advised the $150,000 appropriation would allow them to study one drainage basin. He stated they would start with the area that had the worst problems. He reported the Public Works Committee was looking at this as a starting point. He advised the particular drainage basin had not been selected at this point.
Budget Minutes April 4, 2002 Page Seven
Mr. Davis advised there are several really bad areas: theTwin Oaks Drive area, the Jefferson Pike/Stones River area, and the Lytle Creek area. He stated there were also some bad flooding problems in the Rockvale/Armstrong Valley Road area, as well as the Dilton Mankin/Bradyville Pike area. Mr. Davis advised the study would show what the volumes and capacities are in the drainage area. It will show what the build-out will do to it, construction-wise. It will also tell the pipe sizes and improvements that will need to be made to the streams to deal with the additional drainage. It should also give recommendations on any ordinance changes necessary. It will identify problem areas and how to resolve those issues. It will provide a capital project program. Comm. Sandlin asked if the County Attorney had given an opinion regarding the study? He stated he did not want to spend $150,000 of taxpayer’s money to do a study that was not going to do any good. Mr. Davis reported the Public Works Committee discussed that the study would be a preliminary tool to setting up a system to implement the study. He stated they identified five different ways of dealing with the drainage problems and maintenance problems. Public Works is going to review those and then make a recommendation to the County Commission on the best way to approach the drainage and maintenance problems. He stated that would be put in place along with the study. The study would give the administrative power to whomever is overseeing the drainage problems, whether it is the Highway Department, a separate Public Works Department, a contract issue, or through an inter-governmental agreement between the county and the cities. He stated a drainage authority could also be established. Comm. Sandlin stated he had been a county commissioner for 12 years. He stated one of the biggest things he wanted to tackle was drainage, especially in the rural areas. He stated the County Attorney has consistently stated that the County Commission’s hands are tied unless the Highway Department is changed to a Public Works Department, and then the County could only clean ditches. This may in turn cause a liability issue if a ditch is cleaned and causes flooding somewhere else. He stated everything goes back to the liability. Mr. Davis advised a drainage study would tell what would happen down stream when certain measures are implemented. He stated it would tell what could be done and what could not be done. Comm. Jones stated because implementing drainage measures has a cause and effect, it appeared to her that a drainage study of the entire county would have to be done at one time. Mr. Davis stated drainage does not work that way. He stated drainage basins are, themselves, autonomous. They are flowing into a major river or channel, so they are separate. He stated there are 10 or 12 drainage basins in Rutherford County, and they are all separate from each other. He stated the river capacity has already been determined by FEMA. He stated it does not need to be studied. Mr. Davis stated one thing that could not be done, is that the water elevation of the Stones River could not be raised one foot above the flood stage. He said that is a threshold to be dealt with, and the study will take that into consideration. Comm. Sandlin stated it appeared the study would work only for one problem area. He stated he had about six flooding problems in his district. He stated there are a lot of other drainage problem areas. He stated he did not believe $150,000 would start correcting the problem. He said a study will give recommendations, and then the County will probably have to change codes, etc. Chairman Evans stated he would like to know which basin is going to be reviewed first. He stated he would like for the problem areas to be prioritized. Comm. Sandlin stated he believed the Planning Commission needed to review this request, as well. Comm. Jones asked if the request was going to the Planning Commission? Comm. Ealy advised the Public Works Committee wanted to see a good faith effort made, even if it is a small step. She stated the majority of the committee wanted to start looking at the drainage problems.
Budget Minutes April 4, 2002 Page Eight
Comm. Jones stated Rutherford County does not approve houses to be built in the flood plain. She stated the houses that are flooding, are not Rutherford County’s liability. Chairman Evans stated if some of the neighborhoods formed a non-profit organization and received a grant from someone and hired the same company that the county might hire that would relieve the county from any liability. However, if the county performed the work using county employees or hired a company directly to perform the work, then the county assumes liability. He stated he believed the county should take some action, but he believed it needed to be prioritized. He said since Public Works studies these issues, along with the Planning Commission, it might be appropriate to send it to the Planning Commission for review and to make a priority list and to request approval from the Public Works Committee. Comm. Ealy stated another issue would be if a Public Works Department is to be established, or if the work will be contracted. She stated it might be better to send it to the Planning Commission. Mr. Davis stated a study should not be done until it is decided if the necessary things are going to be done in order to implement the study. If the study is going to eventually cost approximately $1.5 million, the infrastructure to carry it out needs to be established. He stated the biggest problem would be maintaining the areas. Following discussion, Comm. Sandlin moved, seconded by Comm. Throneberry to forward the issue of a drainage study to the Planning Commission to prioritize the areas to be studied and to develop a plan of action and obtain the County Attorney’s opinion relative to the liability concerns. Once all is approved through the committee process, a recommendation for funding is to be forwarded to the Budget Committee. The motion passed unanimously by roll call vote with Comm. Peay being absent. REQUEST TO APPROVE FINANCING BY THE HEALTH, EDUCATIONAL AND HOUSING FACILITIES BOARD FOR BASPTIST HOSPITAL:
Mr. Alfred Smith and Mr. Jim O’Keefe representing Baptist Hospital, Inc. addressed the committee requesting approval of financing by the Health, Educational and Housing Facilities Board of Knox County, Tennessee. The proposed financing is not to exceed $30,000,000 for revenue refunding bonds to finance the cost of making a loan to Baptist Hospital, Inc. Mr. Smith advised a very small portion of the project involves making some improvements to a two-bed facility at Middle Tennessee Medical Center. He advised the State Health & Education statute requires that when the Health & Education Board in Knox County issues bonds for a project in Rutherford County permission be obtained from the Rutherford County Commission. The County Attorney provided a written opinion stating that “Rutherford County should have no liability as a result of the approval process. Rutherford County is not issuing the bonds and has no liability associated with the bond issue. The liability would presumably rest with Baptist Hospital, Inc. and/or the Knox County Health, Educational and Housing Facility Board, which is issuing the bonds. Further, the County will have no liability associated with the public hearing…” Mr. Smith advised the Federal Tax Law states if two projects are within 100 miles of each other, which is the case here, a single TEFRA hearing can be held. He advised this hearing would be held with the Metro Health & Educational Facilities Board on April 23. He stated after that hearing a form would be presented to County Executive Allen for approval. Following discussion, Comm. Sandlin moved, seconded by Comm. Throneberry to approve the resolution approving the financing of a project in an amount not to exceed $30,000,000 for revenue refunding bonds by the Health, Educational and Housing Facilities Board of Knox County to finance the cost of making a loan to Baptist Hospital, Inc.
Budget Minutes April 4, 2002 Page Nine
The motion passed unanimously by roll call vote with Comm. Peay being absent. 2002-2003 BUDGET CALENDAR:
Chairman Evans reminded the committee of the meeting on May 2, 2002 at 5:00 P.M. He advised meetings with individual departments would be scheduled at that time, and it would be helpful if the members would bring their calendars. Comm. P. Johnson stated relative to small budget transfers within a department’s budget, if some consideration could be given to allowing those departments to obtain permission from the County Executive and/or Finance Director without coming through the Budget Committee. Chairman Evans stated he had not had a chance to study the situation, and he was not really in favor of setting a precedent. He stated this would be discussed at a later date. Comm. Peay arrived, and stated he could be listed as absent for the meeting.
ADJOURNMENT: There being no further business to be presented at this time, Chairman Evans declared the meeting adjourned at 8:00 P.M.
____________________________________ Elaine Cawthon, Secretary
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