MINUTES OF THE METRO COUNCIL BUDGET & FINANCE COMMITTEE

Wednesday, February 28, 2001

Council Chamber

Members Present:  Susan McLain (Chair), Carl Hosticka (Vice Chair), Bill Atherton, David Bragdon, Rex Burkholder, Rod Monroe, Rod Park

Members Absent:  None

Chair McLain called the meeting to order at 2:08 PM.

1.  Ordinance No. 01-891 For the Purpose of Adopting the Annual Budget for Fiscal Year 2001-02, Making Appropriations, and Levying ad valorem Taxes, and Declaring an Emergency.

Tony Mounts, Administrative Services Department (ASD) Financial Planning Manager, spoke to the Central Service and Miscellaneous Funds overview. A copy is included in the public record of the meeting. Chair McLain asked when the last audit was done. Mr. Mounts said it was done in 1994 and was due again. Councilor Park asked if Metro was fully self-insured. Jennifer Sims, ASD Director/CFO responded no, Metro bought coverage above certain liability and property deductibles. Metro insured for anything over $500k liability and had $100k deductible.

Councilor Burkholder asked about coverage for possible liability for clean up at Willamette Cove. Ms. Sims said Metro had a $6m pollution liability fund. Metro had no additional insurance; it was not cost effective at this time. Councilor Burkholder asked about the sharp rise in allocated costs to the Zoo over the past two years. Mr. Mounts said the activity level had gone up by approximately 20 FTE due to the addition of Stellar Cove, the gift shop and catering. The result was that the Zoo processed more transactions through Metro. In addition the allocation level went up with agency growth in other areas. Councilor Atherton asked about the Risk Management benchmark compared to other organizations. Scott Moss, ASD Assistant Manager, said Metro spent less money on risk management than other public agencies. Councilor Atherton noted that the premium ratio to overhead was excellent.

Councilor Burkholder asked why debt service on the parking lot had increased. Mr. Mounts said some project money was included in the sum this year. The assumption was that full revenue for the facility would increase over time. Chair McLain hoped to discuss Metro policy and structure of the General and Enterprise Funds and growth under long term funding issues at the Council Retreat or at a later committee meeting.

Lilly Aguilar, Human Resources (HR) Director, spoke to the HR Presentation. A copy is included in the public record of the meeting. Councilor Burkholder asked if the $50k compensation study was a standard contract. Ms. Aguilar said yes, it was the estimated cost to hire a consultant to assess current salaries and make recommendations. Councilor Monroe asked what percentage of HR services supported MERC. Ms. Aguilar promised to give the committee a matrix that showed what services were performed by Metro for MERC. MERC’s HR person handled policy and labor relations issues for their staff while Metro handled most of the support services including personnel actions, recruitment and selection, analysis of Pay for Performance program, etc. The amount of Metro staff time devoted to MERC was significant. Councilor Monroe asked if Ms. Aguilar considered this division of HR work the most efficient method of service. Ms. Aguilar believed that this question was a policy decision for Council; the two personnel systems were not consistent. She said MERC and Metro were different in philosophy, policies and labor agreements. Councilor Atherton asked what the philosophical differences were. Ms. Aguilar said one of the most significant differences was the compensation systems.

David Biedermann, Information Technology (IT) Director, reviewed IT Department FY01-02 Proposed Budget. A copy is included in the public record of the meeting. He noted the additional FTE included a change from.5 to 1.0 FTE for the Help Desk; it was impossible to hire a half-time person at the salary allocated. No additional position funds were requested, instead it would come from within the existing department appropriation. The other 2 FTE added were for the web program. Councilor Atherton asked why the cost per FTE was so high. Mr. Biedermann said that a lot of the cost was for agency software licenses, not salary.

Councilor Park asked if the web position in Creative Services was an allocated position. Mr. Bieder-mann said it was; its location was just an organizational issue. Councilor Bragdon asked about IT becoming host to the Zoo’s web site. Mr. Biedermann said that a local firm had developed the Zoo’s web design pro bono, and had provided the site until it closed the Portland shop and moved their employees to Seattle. IT was able to find a low cost server and made a seamless transfer of the program to it.

Councilor Bragdon asked who maintained the MERC web site. Mr. Biedermann said MERC contracted with Sawnet Technologies for the service. Councilor Bragdon asked if IT could host it more cheaply. Mr. Biedermann said it could be done by IT within MERC’s current allocation. The cost of hosting a site was not a significant amount of money; it entailed having a server on which to run it. He felt it would be simpler to host all the web sites in one place. Peggy Coats, Council Analyst, asked what the upkeep cost of the Zoo web site was, and what the costs of updating and expanding an existing web site might be. Mr. Biedermann said Metro did not do it currently, but IT would review web redesign this year, focusing on Metro’s site initially. MERC contracted for actual design services, but made file transfers to update to their site.

Alexis Dow, Auditor, spoke to the Office of the Auditors Budget Presentation. A copy is included in the public record of the meeting along with her opening remarks. Councilor Park asked about FY 00-01 budget FTE count and contract services. Ms. Dow said last year the .5 FTE was deleted by the Executive Officer and reinstated by Council. It was budgeted under the Personal Services line item as a temporary half time. Councilor Park asked if this position was permanently funded and on staff now. Ms. Dow said it was. John Houser, Council Analyst, asked if the same individual filled this position yearly. Ms. Dow said no, it was activated as needed for particular audits. Chair McLain asked if the Auditor considered the Council Committee Work Plans and their priorities when deciding where to direct her audits and in what order. Ms. Dow said she took both Council and Executive Officer priorities into consideration. Chair McLain noted that there was little information included in the budget presentation. Ms. Dow responded that the information could be found in the Budget Notebook. Chair McLain asked about the $14k audit costs. Ms. Dow said it would go out as an RFP.

Chair McLain noted that Executive Office/Council Office (Support Services) Departments had covered their material at the 2/14 meeting.

Dan Cooper, General Counsel reviewed the FY 2001-02 Budget Schedule and Process Office of General Counsel. A copy is included in the public record of the meeting. Councilor Park asked if Council could require material for the record from interested parties to be submitted in a standard format to facilitate record duplication in case of future litigation. Mr. Cooper said he had not considered such an option, but it might be done. However, it might cause legal problems for the agency. Councilor Park asked if, altern-atively, the charges for staff time could be passed on to those who submitted the material. Mr. Cooper said he did not know, but felt it would be hard to charge people up front to exercise their right to address their local officials. Councilor Bragdon asked how Mr. Cooper determined when to engage outside counsel. Mr. Cooper responded that in certain types of cases, e.g. personal injury litigation, Metro did not have enough claims to justify having a specialist on staff. On certain matters like solid waste-related work, he felt an expert should be engaged who was capable to taking the case to the highest level needed.

Karen Withrow, MCCI staff, reviewed the Office of Citizen Involvement (Support Service Fund) Presentation. A copy is included in the public record of the meeting.

Ms. Sims spoke to the ASD Presentation to the Metro Council Budget and Finance Committee. A copy is included in the public record of the meeting. Councilor Atherton asked if there were further unfunded mandates such as those from the State. Ms. Sims said she was not aware of any. Councilor Hosticka asked if it was typical of government agencies that departments showed no breakout between outside contracts and in-house services under materials and services. Ms. Sims responded that Oregon law mandated it be done by personal services, material and services and capital outlay, so these expenses were grouped together. However, it was broken out individually in the line item budget. Also there was a agency contract list circulated that specified each contract service was as well as the length of the contract. Councilor Hosticka asked if the agency’s reliance on contractors could be presented in a global form. Ms. Sims said it had not been presented in that form, but it could be. Chair McLain asked Mr. Houser to add this item to his department questions.

Ms. Coats distributed Zoo and MERC Council Analyst Questions/Issues Related to Enterprise Fund Departments. Copies are included in the public record of the meeting. Chair McLain noted that each budget amendment should include a method of funding it.

2.  Councilor Communications

Chair McLain noted that MPAC would be held at Bonneville Power today at 5:00 pm.

Chair McLain adjourned the meeting at 4:15 PM.

Respectfully submitted,

Pat Weathers

Council Assistant

ATTACHMENTS TO THE PUBLIC RECORD FOR THE MEETING OF FEBRUARY 28, 2001

The following have been included as part of the official public record:

i:\minutes\2001\budget&finance/022801bdm.doc