03/16/2009
CITY COUNCIL WORKSESSION MINUTES
CITY OF CLEARWATER
March 16, 2009
Present: Frank Hibbard Mayor
George N. Cretekos Vice-Mayor
Carlen Petersen Councilmember
John Doran Councilmember
Paul Gibson Councilmember
Also present: William B. Horne II City Manager
Jill S. Silverboard Assistant City Manager
Rod Irwin Assistant City Manager
Pamela K. Akin City Attorney
Cynthia E. Goudeau City Clerk
The Mayor called the meeting to order at 9:00 a.m. at City Hall.
To provide continuity for research, items are in agenda order although not
necessarily discussed in that order.
Presentations
Service Awards
Three service awards were presented to City employees.
Josue (Josh) Cordero, Public Utilities, was presented the February 2009 Employee of
the Month award.
The Council recessed from 9:03 to 9:04 a.m. to meet as the Pension Trustees.
Office of Management and Budget
Amend the City's fiscal year 2008/09 Operating and Capital Improvement Budgets at First
Quarter and pass Ordinances 8045-09 and 8046-09 on first reading.
The Fiscal Year 2008/09 Operating and Capital Improvement Budgets were adopted in
September 2008 by Ordinances 8005-08 and 8006-08. Section 2.521 of the City's Code of
Ordinances requires the City Manager to prepare a quarterly report detailing income,
expenditure estimates, collections, the explanation of significant variances, as well as the
financial status of all capital improvement projects. The memorandum and the accompanying
report provide this information and outlines the issues at first quarter that require amendment.
In his First Quarter Budget Review - Amended City Manager's Annual Budget Report,
dated February 25, 2009, the City Manager reported the First Quarter Budget Review is in
accordance with the City Code of Ordinances. The report is based on three months of activity
Council Work Session 2009-03-16 1
(October, 2008 through December, 2008) in this fiscal year. The report comments on major
variances, as well as documents all proposed amendments.
Significant Fund amendments are outlined below:
General Fund -General Fund revenues and expenditure amendments reflect a net
increase of $751,113. The major reason for the overall General Fund expenditure increase
includes the appropriation of General Fund retained earnings of $486,870 at first quarter to
include the following items: $107,000 to fund the Matrix contract; $100,000 for the Clearwater
Golf Course Acquisition, $135,380 to support the Homeless Shelter, and $144,490 for the
2007/08 IAFF (International Association of Fire Fighters) contract. All of these amendments
have been previously approved by the City Council.
Other amendments include the allocation of $182,160 to the Fire Department budget for
training incentive funding that had previously been captured in a special program project and
$54,000 to establish the operating budget for the Royalty Theater with like operating revenues.
General Fund Reserves – In order to ensure adequate reserves, the City Council’s
policy reflects that General Fund unappropriated retained earnings of 8.5% of the City’s
budgeted General Fund expenditures must be maintained as a reserve to guard against future
emergencies. With the closing of the year-end 2007 books, and the allocation of reserves noted
above, estimated General Fund reserves at first quarter are approximately $15 million, or 12.4%
of the current year’s General Fund budget, exceeding the reserve policy by $4.8 million.
Significant amendments to other City Operating Funds are noted as follows: 1)
Stormwater Fund -
At first quarter, the Stormwater operating budget reflects an increase of
$24,418 of Stormwater retained earnings representing excess cash in the debt service funds
representing interest earnings in the bond construction funds for the last six months, and the
related transfer of these funds to the capital improvement project for Storm Pipe System
Solid Waste Fund -
Improvements; 2) Budget amendments to the Solid Waste Fund reflect a
decrease of $47,000 reflecting a slight reduction in operating expenditures to offset an expected
Marine Fund -
loss in revenues for the year; 3) First quarter expenditure amendments in the
Marine Fund reflect a net decrease of $296,200 to offset the loss of revenues anticipated for the
Parking Fund -
fiscal year; 4) Budgeted expenditures in the Parking Fund at first quarter reflect
an increase of $279,420 to provide an additional FTE Police Aide position and increased
operating costs for temporary parking, all of which have been previously approved by the City
Central
Council. Increased revenues will more than cover all expenditure amendments; 5)
Insurance Fund -
At first quarter, the Central Insurance Fund operating expenditures reflect the
allocation of Central Insurance Fund reserves for $300,000 to support the CIGNA health
insurance contract and $1.6 million to support the Downtown Streetscape Phase II project; 6)
Capital Improvement Fund -
First quarter amendments to the Capital Improvement Fund
reflect an increase of $2,195,309. Major project amendments include the establishment of the
Royalty Theater project in the amount of $2,650,000, the Downtown Streetscape Phase II
project at just over $2.6 million, and the Aging Well Center for a total of $1,029,720. A list of
capital improvement project budget increases that have been previously approved by the City
Council was included in this report.
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Project budget increases not previously approved by the Council are also summarized in
the report. The largest of these proposed increases is an increase of $25,418 recognizing
revenue from Stormwater interest earnings applied to a Stormwater capital project.
Special Program Fund -
The Special Program Fund reflects a net budget increase of
$1,470,132 at first quarter. Amendments include the recognition of more than $328,463 in
grants proceeds supporting programs for Americorps, tactical weapons illuminators, and
Juvenile Welfare grants supporting neighborhood recreation programs. Other significant
amendments reflect more than $676,000 for the special events and sponsorships programs in
the last six months, $196,000 from police fines and court proceeds to support public safety
programs and $253,000 in revenues for police outside duty contractual services.
Budget Director Tina Wilson reviewed the amendments. Tax revenues were coming as
expected but other revenues are down 6% to 8%. Cost for the additional police aide in the
Parking Fund was $21,000, a temporary/part-time position with no benefits.
Financial Services
Approve the purchase of property and equipment breakdown insurance from April 1, 2009
through April 1, 2010, at the level of insurance recommended, at amount not to exceed
$2,264,125. (consent)
The Risk Management Division of the Finance Department has requested Arthur J.
Gallagher & Co. - (Florida) to obtain quotes for the property insurance program expiring April 1,
2009. This insurance coverage as recommended is identical to the program currently in place;
however different insurers are in place at different layers. The primary layer as recommended
remains the same.
Risk Management reviewed several proposals with different levels of insurance. Risk
also reviewed a pooled approach to coverage, with both the Florida League of Cities and with
PGIT. Both declined to quote.
Several other options of coverage were offered, including: limit of $20M Named Storm +
$30M AOP ($1,405,520); limit of $60M ($2,228,168); limit of $50M without AIG companies
($2,357,760); and limit of $60M without AIG companies ($2,460,160).
Risk Management is recommending a $50M limit with Lexington, an AIG company,
sharing the first $20M of coverage, at an annual premium of $2,125,770. Additionally, it is
recommending that the City renew its equipment breakdown policy with Travelers at a premium
of $11,244. Risk Management believes that should this coverage be placed, the City’s property
risks are covered at levels and rates which, when taken together as a whole, represent a
reasonable insurance program for the City.
In response to questions, Risk Manager Sharon Walton said the level of insurance being
recommended was same basic level as last year. Gallagher/Bassett Representative Greg
Butterfield said U.S. insurance subsidiaries were sound and would not be part of any parent
company bankruptcy filings.
Council Work Session 2009-03-16 3
Human Resources
Approve increasing the not-to-exceed amount from $40,000 to $240,000, to pay Lincoln
Financial for life insurance premiums for CWA Life, SAMP Life, SAMP Supplemental Life, City
Basic Life, and LTD coverages for the period from October 1, 2008 to September 30, 2009.
(consent)
The City has contracted with Lincoln Financial for all life insurance coverages currently
offered and has combined all services into one purchase order. The City currently provides for
the following group life insurance benefits: 1) CWA Life in an amount equivalent to 1 ½ times
the employee’s annual base salary not to exceed $50,000; 2) SAMP Life in an amount
equivalent to 1 times the employee’s annual base salary; 3) Voluntary SAMP Supplemental Life
in incremental amounts equivalent to an additional 1-3 times the employee’s annual base
salary, the premiums for which are payroll- deducted from the employee’s salary; 4) Basic Life
insurance in the amount of $2,500 for all employees except CWA and 5) Long Term Disability
Insurance for those employees who do not participate in the City Pension Plan.
The total amount of the annual expenditures now exceeds $100,000 with this single
vendor. The Purchasing Manager has previously approved a purchase order in the amount of
$40,000 and this request is for an additional $200,000 to cover expenses for the remainder of
this year. Funds have been budgeted and are available in the City’s Central Insurance Fund.
Human Resources Manager Allen Del Prete said the City now has only one provider and
there were no increases from last year.
Approve staff recommendations to offer retirement incentives to eligible employees. (consent)
Creating an incentive for retirement eligible employees to retire during the current FY will
benefit the City’s current budget reduction initiatives in several ways. They are: 1) It will create
vacant FTE’s that may be considered for elimination; 2) It will afford the City additional options
to accommodate employees that are displaced from other positions being eliminated and 3) If it
is necessary to backfill the positions, the new employees will be hired in at a significantly lower
salary.
The following incentives are proposed to be offered to eligible retirees who leave
employment with the City under the established terms: 1) Retiree may receive $5,000 per year
for two (2) years to be paid toward the City-provided medical insurance premiums at the
applicable retiree rate. The retiree is required to elect the City's medical insurance coverage at
the time of retirement in order to be eligible for this incentive; or 2) Retiree may receive a one-
time lump sum of $10,000 cash, minus applicable withholding, in lieu of the payment for medical
insurance premiums or a combination of cash and payment of medical insurance premiums
($10,000 cash and no payment for premiums; $5,000 cash and $5,000 to be applied to medical
insurance premiums). In addition to either of the above, retiree who is eligible and leaves
employment with the City voluntarily prior to May 23, 2009, may receive an additional one-time
cash lump sum of $5,000, minus applicable withholding.
Council Work Session 2009-03-16 4
Eligible employees would be required to apply during a limited application window
(March 23 to April 17) and would be required to retire by September 25, 2009 (last pay period of
the FY). There are currently 170 employees across all departments/all funds that are eligible to
apply. This figure does not include unclassified employees who participate in the 401A Plan.
Should all eligible employees afford themselves of this opportunity, the City would incur
a one-time cost of approximately $550,000 for general fund employees and $580,000 for
enterprise fund employees for the incentives alone. Public safety employees would account for
approximately $360,000 of these costs. If all 170 eligible employees retired and every position
was back-filled at the entry rate of pay, the salary savings for the remainder of FY 2009 and all
of FY 2010 would amount to $3.1 million.
In addition to the costs for the incentives, the City would also incur costs of
approximately $3.7 million for general employees and $1.6 million for public safety employees
for sick and vacation leave payouts. These additional costs represent a current funded liability
that would exist regardless of whether or not the incentives are offered. The City estimates that
no more than 50 of the eligible employees will choose to afford themselves of this opportunity so
the cost, as well as the savings, would be considerably less.
The following chart shows these costs based on all 170 eligible employees retiring.
Estimated Costs/Savings
SAMP/CWA – Enterprise SAMP/CWA – General Sworn – Police/Fire Totals
# Eligible 55 58 57 170
Option 1 incentive 550,000 580,000 570,000 1,700,000
Vac/Sick Payout* 1,400,000 1,200,000 1,700,000 4,300,000
Total Costs 1,950,000 1,780,000 2,270,000 5,900,000
SAMP/CWA – Enterprise SAMP/CWA – General Sworn – Police/Fire Totals
Savings if not filled w/in 710,000 710,000 1,000,000 2,420,000
last quarter FY 08-09
Savings if not filled for 2,800,000 2,800,000 4,000,000 9,600,000
FY 09-10
Savings if all positions 1,800,000 1,700,000 1,000,000 4,500,000
filled at a reduced
salary
* existing retirement costs
Human Resources Director Joe Roseto reviewed the proposed retirement incentives and
said intent of the proposal was to create some FTEs to accommodate employees subject to lay-
off. Only 28 employees expressed an interest. Mr. Roseto said union contracts obligate the
City to bring CWA, IAFF and Police employees at the bottom of the pay scale when back-filling
positions.
Discussion ensued. It was stated that this would be the only offer made.
Direction given to eliminate Option 1.
Parks and Recreation
Council Work Session 2009-03-16 5
Approve the Second Amendment to Baseball Training Facility Lease Agreement and the
Second Amendment to Sports Facility Use Agreement between the City of Clearwater and the
Phillies, authorize the appropriate officials to execute same and approve a mid-year budget
amendment transferring $200,000 from unappropriated retained earnings. (consent)
The four field Carpenter Complex was originally developed in partnership with the
Philadelphia Phillies over 40 years ago to be the main spring training facility for the
Phillies. Their spring games were played at Jack Russell Stadium but the majority of the
teamwork was done at Carpenter.
In the early 1990’s the City made some much needed renovations to the clubhouse in
order to accommodate the needs of the Phillies. At the June 19, 2008 City Council meeting,
City Council approved a term sheet and established a CIP totaling $3,000,000 plus interest to
renovate and expand the existing City building at the Carpenter Complex.
Funding in the amount of $3 million is available for this contract in the capital project
315-93606, Carpenter Complex Clubhouse Renovations as authorized in June 2008. An
additional amount of $100,000 is required under the contract for interest earned as described in
Section 2c of the term sheet. In addition, $100,000 is requested to cover the costs of
schematic and preliminary design costs that have been charged to the Parks and Recreation
operating budget, and were not addressed in the original term sheet. These costs have since
been moved to the project in order to capture all capital costs related to the project. A mid-year
budget amendment will transfer $200,000 of un-appropriated retained earnings to the project to
cover these costs.
Major elements of this project will be to enlarge the coaches locker room, restrooms,
meeting rooms; provide larger and enhanced kitchen and feeding facilities, new office areas,
storage facilities, a second floor totaling 5,650 sf in size to house additional offices, conference
room, restroom and observation areas. As part of this project, the Phillies will assume the year
round clay ballfield maintenance and custodial maintenance of the facility as well as be
responsible for traffic and public safety during spring training beginning in FY 2010. Total annual
savings to the general fund budget will be $219,330 for the remainder of the lease period with
the Phillies, which is 15 years. The project construction commences May 2009 to be ready for
spring 2010.
There will be no increase in operating budgets and staffing levels due to the fact that the
Phillies will pay a greater burden of the operating cost at the Carpenter Complex as well as at
Bright House Networks Field.
In response to questions, Parks & Recreation Director Kevin Dunbar said Spring
Training brings approximately $35 to $40 million into the local economy. The original estimated
cost for the project was $3.5 million; the current estimate was $4 million. The Phillies would pay
any overruns.
Official Records and Legislative Services
Council Work Session 2009-03-16 6
Appoint four members to the Marine Advisory Board with the term expiring March 31, 2013.
Consensus was to reappoint David Hemerick and appoint Eric Spaulding, Paul Lightfoot
and David Napoli.
Legal
Approve joining with multiple cities and counties to present a common defense and share the
cost of outside counsel to defend Addison v. City of Tampa Class Action suit.
Addison is a class action originally filed in 2003 in Circuit Court in Hillsborough County.
It has been brought by two attorneys as representatives of the class of all Florida lawyers who
pay a county or municipal license tax against the defendant class of all Florida counties and
municipalities that charge such a tax. The object of the suit is to invalidate the ordinances that
impose the taxes and collect a refund of all taxes paid, effective back to four years before the
suit was filed.
A class of defendants that includes the City of Clearwater has been certified by the trial
and affirmed by the court of appeals. The issue of whether purported defendants can “opt-out,”
i.e., be removed as a defendant, is presently before the trial court. Even if the City is given the
ability to opt-out, however, it faces the distinct possibility of being bound by whatever decision is
reached in Addison.
Discussion among several municipalities and counties has presented the opportunity of
joining forces and presenting a common defense. Those joining would share the cost of hiring
counsel from the firm of Holland & Knight to appear and defend City interests in the circuit court
in Tampa. The cost for each participant is not expected to exceed $5-10,000 to fund the
litigation through summary judgment. Should the plaintiffs prevail, the City could face the
prospect of refunding nearly $400,000 (and considerably more if prejudgment interest is
allowed) and losing the $37,230 in business taxes it collects from 292 attorneys each year.
It was stated that whether or not the City joins the class action, the City would be
affected by any case ruling. If ruled against the defendants, the City may have to pay $400,000
and lose future revenue.
City Manager Verbal Reports – None.
Council Discussion Items
CRA Clearwater Beach / Convention Center - Mayor Hibbard
Item pulled.
The Council recessed from 10:34 to 10:42 a.m.
Emergency Management Services (EMS) and Fire Service Contracts (WSO)
Council Work Session 2009-03-16 7
Fire Chief Jamie Geer provided a PowerPoint presentation on Pinellas County EMS.
Estimated budget shortfall for Fiscal Year 2009-2010 was $18.6 million. The Pinellas County
Board of County Commissioners would not increase the EMS millage rate to meet shortfall. The
Board proposed to eliminate funding for Rescue Units 46 and 50 and reduce service levels.
In response to questions, Assistant City Attorney Rob Surette said County proposal
would not meet national response time standards for first responders. Current contract requires
a 7.5-minute response time standard. Proposed response time standard would increase to 8.5
minutes.
Discussion ensued and concerns were expressed regarding the unknown impact to
response times and limitations set by Amendment 1.
Staff directed to draft a resolution urging Pinellas County to maintain current EMS
service levels for 2009-2010 and same basis for funding.
Other Council Action – None.
Adjourn
The work session adjourned at 11:51 a.m.
Council Work Session 2009-03-16 8