FINANCE, ADMINISTRATION AND ECONOMIC DEVELOPMENT COMMITTEE MEETING The Finance, Administration and Economic Development Committee meeting was called to order at 7:30 p.m. by Mr. Neil S. Sader, Chairman. The following members were present, constituting a quorum: Mr. David G. Belpedio, Vice Chairman; Mr. Carl R. Gerlach; Dr. Jack Halligan; and Mr. Byron C. Loudon. Also present were: Mr. John M. Nachbar, City Manager; Mr. Bob Jones, Director of Human Resources; Mrs. Kristy Stallings, Director of Finance, Budget and Administration; Mr. Marc Farrar, Assistant City Manager; Mr. David Scott, Manager, Finance and Accounting; Mr. Sig Anderson, Senior Assistant City Attorney; Mrs. Karen Arnold-Burger, Administrative Judge; Mr. Keith Taylor, Municipal Court Judge; Mr. Mike Russo, Administrator of Retirement Plans; Ms. Marian Cook, City Clerk; Mr. Sean Reilly, Manager, Communications; Ms. Michelle Mendoza, Assistant to the City Manager; Ms. Cynthia Boecker, Manager, Budgeting; Mr. Mike Garcia, Manager, Personnel Services; Mr. Ken Rodney, Manager, Information Technology; Mrs. Vicki Bartholow, Switchboard Operator/Receptionist; Mr. Brad Cooper, Kansas City Star; and Ms. Nancee Ellis, Senior Recording Secretary. MISCELLANEOUS INSURANCE NON-OWNED AIRCRAFT Mr. James Charlesworth, Risk Manager, advised that the City s insurance program has always been on a March 15th cycle. He said he is in the process of marketing the City s insurance program this year, and he asked that the coverage s be extended to April 1, which would allow more time in the marketplace. Mr. Charlesworth said all of the insurers were agreeable to extending the date to April 1 with the exception of the aircraft liability insurers who chose not to renew the City s policy this year. The major change involved going from Great American Insurance Company to Old Republic. Mr. Charlesworth commented that Old Republic was an excellent insurer, noting that they insure numerous airports that Mr. Charlesworth represented. He said the limit was still $5 million for bodily injury and property damage. Another change that was made was going from four pilots to one, and the premium was reduced slightly due to that. The annual premium is $5,500 plus $242 for a policy extension, and he asked that the policy run from March 15, 2000 to April 1, 2001, so that all of the policies will be on the April 1st cycle starting next year. Dr. Jack Halligan moved to recommend to the Council a change in insurers from Great American Insurance Company to Old Republic as recommended by Mr. Charlesworth. The motion was seconded by Mr. David Belpedio and passed by a 5 to 0 vote. ACCOUNT APPLICATION FOR VANGUARD 500 INDEX FUND POLICE RETIREMENT PLAN Administrator of Retirement Plans Mike Russo said the Police Pension Plan Board of Trustees adopted a written Investment Policy Statement in October 1997. The policy
Page 2 statement provides an asset allocation guideline for the Trustees to follow when investing the Plan s assets. He said the Trustees voted to reallocate the excess in the International Equities to the Domestic Large Cap Equities. However, instead of transferring the excess to the current active money manager, Harris Investment Management, who is a Large Cap Value money manager, the Board elected to invest the monies in the Vanguard 500 Index Fund. Mr. Russo advised that by the terms of the account application for the Vanguard 500 Index Fund, the Plan Sponsor, which is the City of Overland Park, must sign the application and agree to indemnify and hold Vanguard and its affiliates harmless from any loss, cost, liability or expenses incurred in connection with any action taken upon oral or written instructions reasonable believed by Vanguard or its affiliates to have originated from the named Trustees. The account application allows the applicant to determine the number of Trustee signatures required in order to process a transaction. Three Trustee signatures are required for all written transactions regarding the Vanguard 500 Index Fund. Mr. Russo said staff recommends that the City approve and authorize execution of the Vanguard account application. Dr. Halligan moved to recommend to the Council that staff be authorized to execute the Vanguard account application as explained by Mr. Russo. The motion was seconded by Mr. Carl Gerlach and carried unanimously. WAIVER OF BID PROCESS-CHERYL AXON, CFP, TO REVISE AND UPDATE THE RETIREMENT SOLUTION As relayed in a memo to this Committee from Human Resources Director Bob Jones, dated February 23, 2000, staff requested a waiver of the bid process to contract with Mrs. Cheryl Axon, CFP, one of the original authors, for the revision and update of The Retirement Solution at a cost of $5,000. The book includes chapters about each of the retirement plans available to the employees. It also includes chapters dealing with general financial topics such as Risk Management, Health Insurance, Investments, Estate Planning, Medicare, Mortgages, Wills, Trusts, and Estates. Dr. Halligan moved to recommend to the Council waiving the bid process and authorizing staff to contract with Mrs. Axon to revise and update The Retirement Solution. The motion was seconded by Mr. Byron C. Loudon and carried by a 5 to 0 vote. DEFERRED COMPENSATION PLAN RESOLUTION NO. 2265,B AMENDMENT 1 TO PLAN JOINDER AGREEMENT RESOLUTION NO. 3137 Mr. Russo stated that currently the City s deferred compensation plans allows for participation by employees, appointed and elected officers whose employment is not seasonal or temporary and who work at least 1,000 hours per year. He said staff has received interest from part-time and regular part-time C employees to participate in these plans. In checking with both plan providers, ICMA and Aetna, staff learned that the City of Overland Park is one of few employers who do not allow for all employees
Page 3 who earn income from their employers to participate in the 457 plan. Mr. Russo said since there is no cost to the City other than nominal administrative expenses, staff recommends that all eligible employees except for temporary and seasonal employees be allowed to participate in the City s 457 plan Mr. Gerlach moved to recommend to the Council approval of Resolution No. 2265,B; Amendment 1 to Plan Joinder Agreement; and Resolution No. 3137. Mr. Loudon seconded the motion, which passed by a 5 to 0 vote. RESOLUTION NO. 3106 MUNICIPAL COURT JUDICIAL REVIEW PROCESS Director of Human Resources Bob Jones advised that Resolution No. 3106 includes proposed amendments and revisions to Resolution No. 3061 which pertain to the Municipal Court and Municipal Court Judges. Referring to his memo to this Committee, dated February 23, 2000, Mr. Jones stated that the significant revisions/ amendments fall into two categories; Compensation Section 10 and Terms of Office (Evaluation and Retention) Section 8. Included in the memo was an executive summary to clarify the proposed amendments as follows: Section 10 (d) maintains the April 1 review by this Committee with the adjusted compensation taking effect June 1. Section 10 (e) establishes an adjustment formula; each year, the base compensation of municipal court judges would be increased by an amount equal to the average merit increase granted to full-time City employees in the preceding year. Section 10 (f) offers three alternatives for compensating the Presiding Judge (Administrative Judge) for duties and additional responsibilities. Section 10 (f1) sets a flat dollar amount of $650. This amount was derived through a broadband assessment of the value of the additional administrative duties and responsibilities. Mr. Jones stated that this Committee could review the proposed amount and adjust it yearly, if appropriate. Mr. Belpedio asked how the $650 figure was determined. Mr. Jones said it was based on an evaluation of the list of duties received for the last study and trying to assess what the value of those duties are. Based on that, $650 was fairly close to the difference between one salary grade midpoint and another salary grade midpoint within the City s overall compensation. Section 10 (f2) sets a percentage amount of 8 percent for the additional administrative duties and responsibilities. The actual amount paid would be a function of the base salary paid to the Presiding Judge. Mr. Jones advised that this alternative has a built-in inflation faction. Section 10 (f3) does not establish a specific differential between the Municipal Court Judge and Presiding Judge. Mr. Jones said instead, it creates a differential ceiling between the Municipal Court Judge and the Presiding Judge. The differential between the two judges would never be less than 8 percent. This alternative does not set a specific compensation level for judges and it assumes additional compensation for additional duties are built into the base
Page 4 compensation. The advantage of this approach is that it allows flexibility to hire a new or replacement judge at any amount as long as the differential is equal to or greater than 8 percent. Section 10 (g) provides for a lump sum award for exemplary services on a particular and significant program, event or activity. Mr. Jones believed that the best approach, from the choices outlined, was (f1) which sets a specific amount based on an assessment of the value of additional administrative duties. He said this is independent of the base compensation. If the Committee agreed to follow this recommendation, Chairman Neil S. Sader asked how they would base their evaluation of the $650 differential. Mr. Jones replied the evaluation would be based on a combination of some information they would get from the evaluation piece and from yearly information provided by Human Resources. Mr. Gerlach complimented Human Resources staff for offering a compromise that works well. Section 8 Terms of Office (Retention and Evaluation) Section 8 (a) establishes a 4-year retention for both judges. Section 8 (b) establishes a 5-person judicial review panel to review municipal judges performance for retention. Mr. Jones advised that he asked Manager, Personnel Services Mike Garcia to serve as project leader in the evaluation process this year, and he asked Mr. Garcia to convey what has taken place. Mr. Garcia advised that for 2000, a project team comprised of the municipal judges, members of the City Manager s office and Human Resources Department will develop a prototype evaluation and assessment process and instrument. Components will include the state of court report Judge Arnold-Burger compiles every year; a client feedback survey conducted by the court; a one-on-one assessment (telephone survey) with anyone who has had contact with the court; and a review and assessment of how well the court performs given City policies and procedures, personnel matters, and the use of technology. Mr. Garcia said the review panel would go into force beginning January 15, 2002, when Judge Keith Taylor s term of office expires. Mr. Jones noted that in Section 8 (b) the words the Chair of should be removed so the wording would read The Finance, Administration & Economic Development Committee shall appoint a five-person judicial review panel Dr. Halligan referred to Section 7 (e), which read: As a part-time judge, make a sufficient time commitment to being a part-time Municipal Court Judge to ensure the efficient and proper operation of the court and not engage in the practice of law as a criminal defense attorney or prosecutor in any municipal court during their term of office. He presumed this meant only in any Overland Park municipal court and that it would not exclude a part-time judge from defending or prosecuting in other criminal
Page 5 courts such as Lenexa or DeSoto for instance. Administrative Judge Karen Arnold- Burger said Overland Park does not presently have a part-time judge. Dr. Halligan referred to Section 8 (b) and hoped the five-person review panel would consist of at least one non-lawyer citizen because one of the objectives is to conduct this panel with the community at large and not merely with the legal community. Chairman Sader said language could be added to designate one at-large representative from the public. Dr. Halligan suggested that after the wording retired full-time judge the wording and one non-lawyer citizen of the City be added. In the same section, Administrative Judge Karen Arnold-Burger commented that it may be too limiting to use the word retired full-time judge and suggested that consideration be given to adding the wording current or former full-time judge. She pointed out that the idea is to allow someone who has been a full-time judge. Chairman Sader said that could be changed. Mr. Gerlach moved to recommend to the Council approval of Resolution No. 3106 with the following clarifications: Section 8 (b) to exclude the words the Chair of. Further in that paragraph, the wording should be changed to read: The panel shall consist of at least one member of the Committee, and at least one retired, current or former fulltime judge and at least one non-lawyer resident of the City. He further recommended adopting Section 10 (f1) and 10 (g), plus all other changes recommended by staff. The motion was seconded by Mr. Loudon. Dr. Halligan did not think an evaluation should be done every year. He thought it should be limited to a salary review. He said it is important to maintain the line of demarcation between the legislative and judicial branches. Mr. Gerlach said the evaluation would not include any of the judicial duties in the bench duties. The evaluation would only include the administrative duties outlined in Section 10 (f1); therefore, there is a clear separation. Mr. Loudon pointed out that the municipal court judge has no administrative duties, and there would be no evaluation. The motion passed by a 5 to 0 vote. REPORT TO THE GOVERNING BODY 00-07 PROCESS FOR SELECTION OF JD EDWARDS CONSULTANT TO UPGRADE FINANCIAL ACCOUNTING SYSTEM Manager of Finance and Accounting David Scott said he and Information Technology Manager Ken Rodney were present to answer questions regarding the referenced report. Report to the Governing Body No. 00-07, dated February 10, 2000, relayed that in the City s 2000 adopted budget, $135,000 was appropriated for migration of the City s current JD Edwards accounting system to the newest release of the system. The new release will be easier to use, produce more efficient results and operate on a client/ server platform. Due to the complexity of this system, an outside consultant is needed to assist City staff with this migration. The report continued that in 1994, the City purchased a financial accounting system package (FAMIS) from JD Edwards to run on the City s AS/400 computer system. Two years ago, JD Edwards announced a new release of FAMIS that presents
Page 6 windows like screens to the users, provides new functions and operates on a client/server platform. Migrating FAMIS to the client/server platform supports the City s plan to eliminate the AS/400 as a computer platform. This system will also improve integration among windows applications with financial information and facilitate web-based commerce. The report relayed that using an outside consultant is necessary because of the intricate nature in implementing client/server platforms from a technical aspect, as well as understanding and taking advantage of improved enhancements of the upgraded JD Edwards accounting system. The selection process being proposed for the consultant includes (1) Contacting JD Edwards to identify three potential consultants who have performed the migration for other JD Edwards customers; (2) Interview and evaluate the three consultants recommended by JD Edwards based on factors including expertise in migration of JD Edwards accounting software to client/server platforms; consultant s implementation strategy; and overall cost of consulting services; and (3) Presenting a contract to the City Council. Staff s recommendation is that the City use the process outlined in the report to select a consultant to assist with the migration of the JD Edwards accounting system. Dr. Halligan moved to recommend to the Council approval of staff s recommendation as outlined in Report to the Governing Body No. 00-07. The motion was seconded by Mr. Belpedio and carried by a 5 to 0 vote. REVIEW OF PLAQUE DESIGN/MATERIAL FOR COUNCIL CHAMBER Switchboard Operator/Receptionist Vicki Bartholow showed Committee members a sample of the material in the plaque, noting it was the same material as used in the Sister City plaque on the downtown clocktower. The cost is $1,390, with a $60 mounting fee. Dr. Halligan said the design is very attractive. He then moved to recommend approval of the design/material for the plaque as presented. After a second by Mr. Belpedio, the motion carried unanimously. DRAFT RESOLUTION SUPPORTING FAIRNESS IN THE ELECTRONIC MARKETPLACE Assistant City Manager Marc Farrar advised that staff was directed to draft Resolution No. 3132, included in packet information, in response to last month s Committee discussion, to be considered for adoption by this Committee. In an effort to be more direct, Chairman Sader said the issue relates to the taxation of sales on the Internet, and he asked Mr. Farrar about clarifying the wording in the statement of the resolution to that effect. Mr. Gerlach liked the wording fair and equal commerce. He thought by adding the words Internet tax, people would assume the City wants an Internet tax, which is not correct. Rather, the City is for fair and equal taxation regardless of whether it is retail, catalogs or the Internet.
Page 7 Referring to the opening statement in Resolution No. 3132, Mr. Loudon suggested the words taxation of be added after the word equal so the statement would then read: A resolution by the Overland Park City Council in support of fair and equal taxation of commerce. Mr. Loudon moved to recommend to the Council that change and the motion was seconded by Mr. Belpedio, which passed by a 5 to 0 vote. STATE LEGISLATIVE POSITION STATEMENT ENSURING FAIRNESS IN THE ELECTRONIC MARKETPLACE As relayed in Mr. Farrar s memo to this Committee, dated February 22, 2000, at last month s Committee meeting, staff was directed to prepare additional information to assist in the consideration of a state legislative position regarding Internet commerce. Specifically, there was interest in gauging the number of users on the Internet, the amount of commerce conducted, the positions of the Congressional delegation on Internet commerce taxation and the views of those opposed to Internet taxation. Mr. Farrar s memo continued that staff members for Senators Roberts and Brownback, as well as Representative Moore indicated that they are waiting to review the upcoming report from the Advisory Commission on Electronic Commerce before taking a position on Internet commerce taxation. This will be an issue for discussion at the upcoming legislative conference hosted by the National League of Cities. Attached to Mr. Farrar s memo was a draft statement for Committee consideration regarding Internet Commerce and the City s position. He noted one change to be made was deletion of the first sentence in the second paragraph of the Background statement which read: Currently, Internet retailers are not required to charge customers a sales tax on transactions conducted over the Internet. Mr. Farrar said the last paragraph would then be inserted there. Mr. Farrar advised that this is a position for the State Legislative Program. Mr. Loudon moved to recommend to the Council that the State Legislative position statement be adopted as presented by Mr. Farrar. Mr. Belpedio seconded the motion, which passed by a 5 to 0 vote. RESOLUTION NO. 3046 MEMBERSHIPS/DUES IN CERTAIN ORGANIZATIONS (ANNUAL REVIEW) The referenced resolution authorizes payment of memberships and dues in certain organizations and rescinds Resolution No. 2976. The organizations include: Mid- America Regional Council; National League of Cities; Development & Retention Council of N.E. Johnson County; Johnson County Council of Mayors; League of Kansas Municipalities; City of Overland Park Chamber of Commerce; Debt Management Advisory Council; and Sister Cities International. Sr. Assistant City Attorney Sig Anderson said this resolution is in effect, and it is before the Committee only for their review.
Page 8 FAMILY SURVIVAL KIT Assistant to the City Manager Michelle Mendoza referred to her memo to this Committee, dated February 26, 2000, which relayed that the Family Survival Kit contains information to help parents and children face a wide variety of challenges that occur during a child s teenage years. Since 1997, the Finance, Administration & Economic Development Committee has approved an annual allocation of $12,000 to $15,000 from the City s Special Alcohol Control Fund to produce the Kit and mail it to the parents of children either in the first year of high school or the first year of middle school. In addition to the mailing, the Kits are distributed to all City facilities, including Court Services and several local resource agencies. The memo relayed that it is now time to determine whether the fourth production of the Kit should begin. In order to assist the Committee with their decision, the results of the survey distributed with the Kit in 1999 were included with the memo. Ms. Mendoza said staff is asking for approximately $12,000 from the Special Alcohol Control funds if the Committee wants to fund the program at the same level as was done in previous years. Chairman Sader asked if this program could be put on the Internet web site, and Ms. Mendoza said that was a possibility. Mr. Gerlach believed this was information that needs to be bestowed upon parents because they may not know or recognize there is a problem. Parents who know there are problems with their children usually seek information about the problem. However, in many cases, parents in today s society are not aware of the signs to look for in drug and alcohol abuse by their kids. He saw greater benefits to mailing the information to parents rather than putting the information on the Internet as an available resource. Mr. Gerlach said it could be put on the Internet in conjunction with the mailing. Mr. Belpedio asked Ms. Mendoza if it was possible to change the color of the folder to something brighter, and she indicated that would be no problem. Mr. Gerlach suggested it may be helpful to put some Overland Park figures into this information showing for instance the number of teenage alcohol related arrests. Ms. Mendoza said those statistics could be included. Chairman Sader commented that the survey information was great and asked if there was a way to increase the number of responses. Ms. Mendoza said staff would work on that. He also asked her to check into getting this information on the City s web site. As an incentive for returning the surveys, Mr. Gerlach suggested that those names could be put into a drawing for a free swimming pool pass for a year. Mr. Belpedio moved to recommend to the Council the continuance of the Family Survival Kit program at a funding amount up to $15,000, including putting the information on the City s web site and include a drawing for a free pool membership for returned surveys.
Page 9 Mr. Gerlach seconded the motion, which passed by a 5 to 0 vote. SISTER CITIES UPDATE Ms. Mendoza stated that at the Chairman s request, staff developed a summary of the events and funding for last August s activities. A memo from Ms. Mendoza to this Committee, dated February 26, 2000, relayed that on August 26th, a delegation of 15 City representatives and an 80-member youth band from Bietigheim-Bissingen, Germany, arrived in Overland Park to formalize the new Sister City relationship, introduce Bietigheim-Bissingen as Overland Park s Sister City to the community and continue business discussions that began in June in Germany. With regard to financing, in July 1999, the Sister City Committee presented the Finance, Administration & Economic Development Committee with a proposed budget for the August visit. Business sponsorships, along with $6,000 of Contingency Fund money approved by the Finance, Administration & Economic Development Committee was used to pay for the expenses incurred during the August visit. Due to meal expenses and non-budget expenses being larger than anticipated, the City Manager approved an additional $878.64 from the Contingency Fund to cover all expenses, resulting in a total Contingency Fund Expenditure of $6,878.64. Chairman Sader believed that for this concept to work, the Sister City Committee must meet on a regular basis, and Ms. Mendoza concurred, adding that was being planned. The Chairman asked Ms. Mendoza to comment on staff s contact with the City of Kansas City and what their comments have been in this regard. Ms. Mendoza said she met with the Chair of that group briefly but they did not have all the details together at this time. She said Hanover, Germany is Kansas City, Missouri s Sister City, and Mayor Kay Barns has approved the coordination of a jazz festival in Hanover. There has been some discussion with regard to asking Overland Park to invite musicians from here or musicians from Bietigheim to participate in that activity. NONAGENDA ITEM: CONTRACT FOR CONVENTION CENTER Chairman Sader stated that it is anticipated staff would be receiving the contract and convention center documents regarding the relationship between Overland Park and the developer and management of the convention center. Also, soon, there will be a Request for Proposal for a convention center manager and Chairman Sader suggested that some meetings be scheduled to review these documents. Director of Finance, Budget & Administration Kristy Stallings suggested the Committee select and reserve a few dates for the review and development of these documents. She noted that it is possible that all of the documents will not be available at one time for review. In approximately two weeks, the development agreement should be ready for review. She advised there are agreements that will be coming before the Committee probably later in March and early April. Chairman Sader suggested moving the regularly scheduled Committee meeting from March 15th to March 27th for the purpose of reviewing the development agreement on
Page 10 March 15th. Mrs. Stallings interjected that review of the City s property and liability insurance plans were previously done in February; however, that needs to be done before March 27th; otherwise, the Council will not have approved the contracts for the insurance prior to when they are effective. She asked if the Committee could meet briefly to review the contracts at a special Committee meeting on March 20th before the Council meeting. Committee members concurred. Mrs. Stallings said the development agreement could then be reviewed on March 27th, noting that there may be other agreements ready for review at that time. Chairman Sader suggested there be a motion to cancel the Committee s March 15th meeting; reschedule it to March 27th; and add a special meeting on March 20th to review insurance documents. Mr. Loudon moved to recommend approval of the meeting dates as discussed, Mr. Belpedio seconded, and the motion carried by a 5 to 0 vote. At 9:25 p.m. the Chairman adjourned the meeting. Minutes transcribed by Nancee Ellis. Neil S. Sader, Chairman