DEPOE BAY RURAL FIRE PROTECTION DISTRICT Board of Directors Meeting Tuesday, March 14, 2017 following 5pm Workshop Station 2200 Gleneden Beach MINUTES

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1 DEPOE BAY RURAL FIRE PROTECTION DISTRICT Board of Directors Meeting Tuesday, March 14, 2017 following 5pm Workshop Station 2200 Gleneden Beach MINUTES 1. CALL TO ORDER President Lloyd called the meeting to order at 5:30 pm. Pledge of Allegiance had been recited earlier at the Board Workshop. 2. ROLL CALL by Administrative Assistant Gina Geary: Present: President Dennis Lloyd Vice President Robert Batty Director Barbara Leff Director Paul Erskine Excused: Secretary-Treasurer David Perry A quorum was established. (Item Moved Forward) 10. B. AUDIT REPORT: Signe Grimstad, Grimstad & Associates Ms. Grimstad prefaced her report by explaining that because of transitions (retirement of administrative assistant Phyllis Palmer, hiring of Gina Geary) and the time when the books were ready, her report is a draft. She wants the Board to have plenty of time to review the audit report and recently completed MD&A. She reminded the Board that the District has an extension until April 30, Ms. Grimstad noted that the fire district had a busy fiscal year , including adding a third fund the Seismic Rehabilitation Grant fund. She is offering a clean opinion while pointing out that unauthorized interfund loans that have been taking place between the Seismic Rehabilitation Grant fund (hereafter referred to as Seismic Fund ) and the General Fund. This happened because bills for the seismic rehabilitation of Station 2300 must first be paid before the District can submit a reimbursement request. Once reimbursement checks are received, funds are returned to the General Fund. In a letter to the Board, Ms. Grimstad suggests that in budgeting this year, the District plan for loan reimbursements, at the same time adding that she understood that a receivable of about $77,500 due at the end of FY was reimbursed in FY Ms. Grimstad urged the Board to carefully monitor interfund loans and explained that a more correct way to have handled this would have been for the Board to pass a formal resolution documenting a loan either a lump sum or a draw. Since this practice has continued in FY , the Board can pass a resolution acknowledging the past practice, explaining the reasons, and formally approving an interfund loan going forward. Page 1 of 8

2 Ms. Grimstad also noted that there is a little bit of sharing between the Capital Reserve Fund and the checking account, which is fine and a matter that Ms. Grimstad has discussed with AA Geary. Ms. Grimstad said that she liked the job costing that s going on and grant activity monitoring. She did suggest that rather than trying to reconcile grant receipts and grant expenditures within one line item on the general ledger, that instead the District keep receipts and expenditures in separate line items and reconcile these grant receipts and expenditures in an Excel spreadsheet outside of the general ledger for monitoring. Ms. Grimstad said the books are in good shape. She noted work in progress on page 17 of the audit report, including the LED sign at Station 2200 that was being built but was not completed at fiscal year-end. The District s debt was paid off in August 2016, but as of June 30, 2016, there was still a balance of $51,999. She noted that one of the future disclosures will be the District s interest expense for the year and how much of that was capitalized. Because the District s activity is getting more complex, this will require more monitoring of grant activity going forward. Ms. Grimstad said that the overall presentation of the audit report has not changed from previous years, including a pension disclosure, bonds being issued, and total reimbursements this year. Ms. Grimstad pointed to reporting for the District s three separate funds and again pointed out that the Seismic Fund ended the year with a deficit balance and that the General Fund is supporting the Seismic Fund until reimbursement funds come in. Ms. Grimstad referred to Oregon Minimum Standards on pages 36-37, commenting on the Seismic Grant not having sufficient funds and having an unauthorized loan at year-end. She added that this is not too unusual and that she does not expect the District to hear anything back from the State on this other than a possible request for confirmation that the District is aware of it and that the interfund loan will be taken care of this budget year. Chief Williams mentioned that he would later be asking the Board to authorize creating an additional savings account into which the Station 2300 construction loan funds will be deposited. He asked Ms. Grimstad whether she recommended tracking the new account outside of QuickBooks with Excel? Ms. Grimstad answered that while it s not necessary, tracking grants and job costing in Excel is an excellent way to monitor account activity and bond expenditures. Director Leff asked for clarification about what it means to move out from QuickBooks to Excel. Ms. Grimstad explained that the information is copied from QuickBooks to Excel, but is not deleted. Copying certain information into Excel does not create a duplicate set of books. Excel is a tool that allows the Board to compare detailed revenue and expense data for certain projects while maintaining the integrity of the QuickBooks general ledger in accordance with local government budget law. Director Batty asked questions on behalf of audit committee member David Lantto, who Page 2 of 8

3 was unable to attend the board meeting because of illness. Mr. Lantto was particularly concerned about the term unauthorized loan on page 15. Ms. Grimstad confirmed that this term was used to describe the situation discussed earlier a loan from the General Fund to the Seismic Fund that had not been acknowledged by the Board as of June 30, Mr. Lantto had expressed worry that someone reading the report might be concerned about this negative term. Ms. Grimstad again noted that the unauthorized loan can be addressed by a resolution by the Board. Board options include transferring money to an account for the Seismic Fund so that no borrowing is necessary or passing a resolution authorizing a loan to be reimbursed within a certain time frame. As long as a loan is reimbursed by the end of the fiscal year, all is well, and the loan has no budget impact whatsoever. A resolution leaves a good trail and shows that the Board is aware that the District is borrowing from another fund. Director Batty asked if further explanation would be included in the audit report. Ms. Grimstad answered that the paragraph on page 15 was the explanation. AA Geary apologized for her ignorance in this matter and offered to talk with Mr. Lantto about what has been happening the District receives bills for the Seismic Rehab, the District pays them, and only after paying them can the District submit a request for reimbursement. AA Geary also asked what would the best way to handle the situation going forward For the Board to authorize loaning the Seismic Fund a large lump sum temporarily? Month-bymonth? Ms. Grimstad answered that this is at the discretion of the Board and depends on the District s overall cash flow needs. A large lump sum loan might be easier logistically than month-by-month loans, and a projection of expenses and reimbursement times may be helpful. President Lloyd commented that this seems similar to a revolving loan. Ms. Grimstad answered yes, it is like a line of credit. AA Geary explained that, because of her ignorance of the matter, the interfund loan has continued during the current fiscal year without a Board resolution. Ms. Grimstad suggested summarizing interfund activity in a financial report and then acknowledging the activity with a Board resolution, perhaps with language along the lines of stating that the funds were inadvertently borrowed, that this was brought to the Board s attention, and stating any current loan need. (Ms. Grimstad noted that she is not an attorney and cannot give advice about exact wording of a resolution.) Director Batty said that Mr. Lantto had also asked about the pension. Ms. Grimstad declined to talk about the pension as a matter out of her area of expertise and suggested that the Board consult call a pension and/or PERS expert. She added that an OPEV review is coming up in two years, and they will use the same process for future projections, and the District will probably book another liability. Ms. Grimstad noted that the actuary is audited as well, and she and her staff look at how they re being applied and make sure that there s not an error to the best of their ability. To change the projection calculations, the numbers themselves, is up to legislature. In closing, Ms. Grimstad reminded that Board that she had shared a DRAFT report and asked everyone to proofread carefully for typos and corrections. She added that the transition between Phyllis and Gina went well, particularly since Gina was under the gun for jumping in and moving forward. Page 3 of 8

4 President Lloyd asked if basically the only thing the Board really needed to do was the resolution for the interfund loan. Ms. Grimstand replied yes, and monitor the fund going forward while being aware that the Seismic fund does not have a bank account at this time and probably will not have one. AA Geary commented that the hope is that the Seismic Fund and grant can be wrapped up within this current fiscal year, which would be a good, clean break. Director Erskine asked if the District got an extension to the original grant deadline of March Chief Williams confirmed that the grant deadline was extended through June 1, APPROVAL OF MINUTES President Lloyd called for approval of minutes of the February 14, 2017 regular Board Meeting. Motion by Leff, seconded by Erskine. No further discussion. MOTION carried unanimously. 4. FIRE CHIEF S REPORT Chief Williams reported that arbitration with the Union has been rescheduled due to illness. An exact date has not yet been picked, but the meeting is planned for some time in April. Chief Williams also asked to add something to the agenda CREATION OF SAVINGS ACCOUNT. Board members agreed that it would be more convenient to discuss the matter immediately rather than later in the agenda. Chief Williams explained that he has been notified by USDA that the District needs to have an interest-bearing account in which to place the interim loan funds. The finance adviser hired through USDA had thought the District could just use its checking account, but USDA requires a separate account. A benefit of this requirement is that it should make the District s accounting cleaner and easier. To open a savings account at Columbia Bank, the Board will have to go through the same process required to open the checking account, including board approval, signature cards, and minutes from tonight s meeting signed by Secretary-Treasurer. Chief Williams asked the Board for a motion to establish a savings account and also a directive of who the signers on that account will be. Director Erskine moved that the Board open said savings account at Columbia Bank and that the signers include: Charles Dennis Lloyd, President Robert A. Batty, Vice President David Perry, Secretary-Treasurer Barbara Leff, Director Paul M. Erskine, Director Joshua Williams, Fire Chief Director Leff offered the possibility of only a few signers rather than the entire Board, but availability of signers was deemed important. Motion seconded by Leff. No further discussion. MOTION carried unanimously by roll call vote: LLOYD YEA BATTY YEA LEFF YEA ERSKINE YEA Page 4 of 8

5 5. VOLUNTEER ASSOCIATION REPORT Chief Williams referred board members to report in board materials and added that the Volunteer Association is currently looking at planning the banquet. The Association is also considering ways to strengthen the Association, such as quarterly meetings. 6. TRAINING UPDATE: AC Johnson AC Johnson reported that 3 more sessions are left in the EMT Advanced class before state testing in April. Attendees report that training is going well. Completion of this training enable the District to have at least one advanced EMT on every shift of two or better plus paramedics on two shifts, allowing us to provide a higher level of care to citizens. In February crews participated in extrication training with North Lincoln Fire. Crews have requested additional equipment for next budget year. Last weekend some crew members attended a class offered by a retired battalion chief out of the Denver area called The Art of Reading Smoke and The Art of Reading Buildings, a 16-hour course that was well attended. A grant from the Central Oregon Coast Training Officers Association helped pay for the instructor s costs. Coming up will be confined space training with North Lincoln Fire. 7. ITEMS NOT ON THE AGENDA Add 11. B. APPOINT BUDGET OFFICER FOR FY Director Leff moved that the Board appoint Chief Williams as Budget Officer for FY Seconded by Erskine. No further discussion. MOTION carried unanimously. 8. SECRETARY-TREASURER S REPORT & STATEMENT OF BILLS Vice President Robert Batty reported on bank balances, various fund transfers, payroll, accounts payable, expenditures, and income for February 2017 as noted in the Secretary- Treasurer s report and other financial reports in the Board book. Director Batty called for a motion to approve Secretary-Treasurer s report as well as Accounts Payable and Payroll activities for February 2017, noting there was not a potential or conflict of interest. Motion by Batty, seconded by Erskine. No further discussion. MOTION carried unanimously. 9. CORRESPONDENCE A. Media articles as presented in the DBFD Media Record. B. Newsletter to Fire District and Responders should have been received by Board members by U.S.P.S. mail, and a copy was also provided at meeting. President Lloyd encouraged all to share with himself and Chief Williams suggestions and comments for what to include in the next newsletter. President Lloyd suggested that perhaps the newsletter include an article on each of the staff members, one per newsletter, so the community can get to know who their firefighters are. Director Page 5 of 8

6 Batty praised the newsletter, especially the fire station update. Chief Williams also mentioned a letter received from a family member, thanking the crew for their assistance on a call at which, unfortunately, someone was deceased. The family member was very pleased with the District and the response of the EMTs. The crew was notified of the letter and given a copy. Although the letter did not make it into the Board book, it will be included next time. 10. OLD BUSINESS A. Station 2300 Construction/Financing Update: Chief Williams reported that after ongoing negotiations and discussions with the District s attorneys about the contractor s perceived issues with the USDA loan, the contractor agreed to increase the contract by 2% (rather than 5.25% to 10.5% discussed). The District now has a contract that is signed and executed. The USDA has accepted it. The interim financer is happy with it, and the District has a closing date of March 21, On that, money will be deposited directly to the new savings account. Director Lloyd asked if that increase was within what the Board had approved last month. Chief Williams confirmed that it was, although it will impact the contingency budget. He added that this increase also dashed any hope that funds budgeted from the Capital Reserve Fund might be spared. The District will definitely have to use some Reserve Fund money. The USDA is also looking into the possibility of a cost overrun grant for up to $50K, which would be a big help. Chief Johnson has been working with Kathy Bowman from Mackenzie on credits for LED lighting, energy-saver appliances, and better insulation. Renovation should be past the point where big surprises present themselves. Contractors are currently in the carpentry stage upstairs. The changes that have been made to the building have addressed specific issues (e.g. rot, design flaws) rather than added to the scope of the building. Another example is that the Chief s Office, a.k.a. the fish bowl, has settled by a few inches and needs to be repaired. Chief Williams added that Chief Johnson will be moving down to Depoe Bay and using this as his new office. Chief Williams added that the financing situation contributed to the interfund loan issue described by Ms. Grimstad in the audit report because the District did not anticipate going so long using its own money. Conditional Occupancy is planned for March 31, 2017, at which time crews should be able to move back into the fire station. The key to this date is the finish work and the second means of egress (the deck and the door from the second story). Chief Williams added that even though the building is sprinklered, as an added safety precaution, he and Chief Johnson would like to add a folding ladder to each room. Chief Johnson noted that the elevator is in and that all four bay doors are in and have been widened. President Lloyd asked how this all affects repavement. Chief Williams answered that there will not be enough money for pavement, but he has applied for a grant through Page 6 of 8

7 the City of Depoe Bay Urban Renewal. Director Leff noted that the Fire District was in the original Urban Renewal plan, so she expects the money will be awarded. AA Geary asked how soon the District will know whether the house will be needed for April. The District paid the last month (prorated) in March, but has an option to continue the lease in April day-by-day as needed. AC Johnson said he expected to have an answer at the meeting on March 22, Director Batty asked if there will be a fire pole in the station. Chief Williams confirmed that there will be a fire pole, and safety and liability issues were discussed. AC Johnson confirmed that there will be documented training for firefighters on how to safely use the fire pole. Chief Williams added that for this station, stairs have been a hazard, so the fire pole is intended as both a safety improvement and as a way to save time. AC Johnson said that the pole will have a cushion at the bottom and will be an enclosed space with a door with a high door knob to prevent children visiting the station from entering. AC Johnson also confirmed that only firefighters will be using the pole and that a policy will be written stating such. Although Pacific West Ambulance leases space at Station 2300, the ambulance crew will not be authorized to use the pole. President Lloyd stated that the District will need to start planning for an open house as Station 2300 when and what that will consist of. AC Johnson said that based on the punch list and other factors, he would estimate that early June may be a possible time for an open house. Chief Williams added that local fire dancers will perform at the open house. B. Audit Update: (Moved Forward in the Agenda) 11. NEW BUSINESS A. Wall Monument for Station 2300 Chief Williams referred Board members to examples of possible bronze plaques to be installed at the Depoe Bay station. A plaque is a requirement of the Seismic Rehabilitation Grant. Director Leff pointed out a typo in the draft examples of the plaque, and Chief Williams assured her that it would be corrected. Chief Williams explained that the old plaque will be replaced where it used to be on the building, and the new one will be placed beside it to show the history of the station. The plaque will be 20 x24 bronze, and the expense is reimbursable through the grant. Chief Williams and board members expressed a preference for Example 1 a rectangular plaque with a simple, dark background. 12. BOARD MEMBERS TRAINING OPPORTUNITIES A. SDAO Regional Networking Meetings: Chief Williams noted the SDAO update in Board materials. Page 7 of 8

8 B. OFDDA Fire Service Conference, October 26-28, Ashland, OR. Chief Williams has reserved six rooms at Ashland Hills Inn & Suites for board members, arriving the day before and leaving the day after. 13. PERSONNEL & INCIDENT RESPONSE STATISTICS INFO ONLY Chief Williams referred to reports in board materials and added that the District is ahead of last year in number of incidents. During a busy period last week, crews ran 23 calls in a 3- day period. He also mentioned that the mechanical CPR donated last year has been put to good use three times in the past week. The Board asked Chief Williams to send a followup note to the donor, thanking her for the dramatic difference it has made for the crews and community. 14. PUBLIC COMMENTS AND/OR QUESTIONS None. 15. AGENDA SUGGESTIONS None. ADJOURNMENT at 6:49 pm. Respectfully submitted by Gina Geary, Administrative Assistant. Secretary-Treasurer David Perry Date An audio recording of this meeting is located at the Depoe Bay RFPD Administrative Office, 6445 Gleneden Beach Loop, Gleneden Beach, Oregon. Page 8 of 8