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HomeMy WebLinkAbout11-18-2002 CITY OF AUBURN FINANCE COMMITTEE November 18, 2002 MINUTES I. CALL TO ORDER - 6:30 PM, CONFERENCE ROOM NO. 1 Chair Fred Poe called the meeting to order at 6:30 PM in Conference Room 1 located on the first floor of Auburn City Hall, 25 West Main Street, Auburn. Members present included: Chair Poe, Vice Chair Trish Borden, and Member Cerino. Others present during the meeting included: Finance Director Shelley Coleman, City Attorney Daniel B. Held, Human Resources Director Brenda Heineman, and City Clerk Danielle Daskam. Also present was Ben Moore of Freddie's Club Casino. II. APPROVAL OF MINUTES A. Minutes of the November 4, 2002 Finance Committee meetin.q Member Cerino moved and Vice Chair Borden seconded to approve the November 4, 2002 Finance Committee minutes. MOTION CARRIED UNANIMOUSLY. 3-0. III. CONSENT ITEMS A. Vouchers 1. Claims F4,9,5 Claims check numbers 315717 through 316101 in the amount of $1,833,517.98 and dated November 18, 2002. 2. Payroll F4.9.2 Payroll check numbers 502160 to 502329 in the amount of $573,765.93 and electronic deposit transmissions in the amount of $924,692.15 for a total of $1,498.458.08 for the period covering October 24, 2002 to November 15, 2002. B. Bad Debt Write-off , F4.12 Page 1 Finance Committee Minutes November 18, 2002 City Council to authorize the write-off of utility account bad debts in accordance with City policy in the total amount of $12,718.45. C. Surplus Property F4.6.1 1. Finance Department City Council to authorize the surplus and disposal of the following described property, which is of no further use to the City: Hewlett Packard Scan Jet 5100C Scanner 2. Parks and Recreation Department City Council to authorize the surplus and disposal of the following described property, which is of no further use to the City: Temporary Storage Container Finance Director Coleman reviewed the bad debt write-off. She explained that the accounts have either filed bankruptcy or are otherwise highly uncollectible. Vice Chair Borden moved and Member Cerino seconded to approve the consent items. MOTION CARRIED UNANIMOUSLY. 3-0. IV. ORDINANCES AND RESOLUTIONS ^. Ordinance No. 5697 F4,14 An Ordinance of the City Council of the City of Auburn, Washington, creating and establishing a Narcotics Buy Fund for the purpose of financing law enforcement and investigation activities of the Narcotic Unit. Finance Director Coleman presented Ordinance No. 5697, which officially establishes a Narcotics Buy Fund. The fund supports narcotic investigative activity and is replenished periodically from forfeited narcotic monies. Vice Chair Borden moved and Member Cerino seconded to recommend approval of Ordinance No. 5697. Page 2 Finance Committee Minutes November 18, 200? MOTION CARRIED UNANIMOUSLY. 3-0. B. Ordinance No 5703 F6.4 An Ordinance of the City Council of the City of Auburn, Washington, amending Auburn City Code Section 3.80.060 entitled "Tax - Levy - Social Card Games" contained in Auburn City Code Chapter 3.80 entitled "Gambling Activities" to increase the tax rate on social card games as defined in RCW 9.46.0282 from twelve percent to fifteen percent effective January 1, 2003. Chair Poe introduced Mr. Ben Moore, General Manager of Freddie's Club Casino in Auburn, in attendance to comment on proposed Ordinance No. 5703. Mr. Moore advised that the principals of Freddie's Club Casino learned today that the proposal to increase gambling taxes would be on the Finance Committee's and Council's agenda for this evening. He requested that the Committee postpone action on Ordinance No. 5703 to allow time for Freddie's Club to make a formal presentation to the Committee. Mr. Moore indicated that increasing the gambling tax on card rooms from 12% to 15% would severely impact Freddie's Club Casino operations. He noted that Freddie's Club in Auburn pays in excess of $700,000 in gambling taxes to the City each year and provides a $4 million payroll for the area. He stated that Freddie's club business has slowed and has been impacted by the Muckleshoot Casino. He stated that the tax increase would so severely impact the business, the casino may be forced to close. Mr. Moore stated that if the tax increase had been enacted in January 2002, the casino would not make a profit this year. Mr. Moore reported that there are negotiations ongoing for the sale of the property by the Steiner Estate, and the proposed tax increase may jeopardize the sale. Mr. Moore also briefly discussed proposed legislation for the electronic lottery system. It was consensus of the Committee members to postpone action on Ordinance No. 5703 in order to provide Freddie's Club Casino an opportunity to comment on the proposed ordinance. Page 3 Finance Committee Minutes November 18, 200? Chair Poe recommended that Mr. Moore address both the Municipal Services Committee and Finance Committee at their meetings on December 2, 2002. V. DISCUSSION ITEMS A. Interpretation of Jail Service.~ Human Resources Director Heineman presented information on jail services and incarceration costs. She reported that since 1997, the City has experienced a 367% increase in incarceration costs. She reported on a recent meeting with Judge Burns, City Attorney Heid, Police Chief Kelly relating to jail costs. Judge Burns has indicated that he is amenable to the prosecutor's office petitioning him for early release of inmates for good behavior. This would enable the City to retain immunity for any early release of a prisoner. Ms. Heineman expressed concern with the potential liability if the City were to permit early release of prisoners without a court order or take reservations for incarceration as a means for reducing the City's incarceration costs. City Attorney Heid commented that the City could legally grant early release for prisoners without a court order and cited King County as an example. Director Heineman also commented on the use of the alternatives to incarceration including electronic home monitoring for pre- sentencing and drug and alcohol treatment alternatives. B. Airport Funding Finance Director Coleman presented a handout regarding Airport Roof Replacement Project for hangars 2 and 7 that is on the Council's agenda for award this evening. She explained that the 2002 Budget included $150,000 for the project. Of that amount, approximately $7,500 has been used for architectural and design fees, leaving approximately $142,500 available. The bid recommended for award this evening is $207,000. Ms. Coleman stated an additional $75,000 is needed for the construction project. She proposed utilizing funds from the insurance fund due to potential liability issues if the roofs were not replaced. Ms. Coleman projected the working capital balance for 2002 will be approximately $250,000. Vice Chair Borden and Member Cerino commented that the Airport budget should support itself, and the expense should come from its fund balance if one exists. Page 4 Finance Committee Minutes November 18, 200? Finance Director Coleman commented that the Airport anticipates a large grant next year from the Federal Aviation Administration for resurt'acing. The Airport Fund will need to provide a matching share for the grant. Chair Poe stated the Airport Fund must be self-supporting. If the fund needs to borrow money, a proposal can be made to borrow funds. It was consensus of the Committee to utilize working capital for the Airport roofing project. C. Utility Tax Finance Director Coleman presented handouts on potential revenue from utility tax increases, General Fund budget cuts for 2003 and unfilled positions by department. Approximately $1.5 million has been cut from General Fund budgets and approximately $600,000 in savings will be realized by unfilled positions. Ms. Coleman reviewed the impact of the utility tax increases on an average electric, gas, phone, and cable bill at increments of 0.5% up to 1.5%. Chair Poe expressed concern with passing utility tax increases without further opportunity for the public to comment. It was consensus of the Committee to discuss the proposed utility tax increases at the next Finance Committee meeting. VI. ADJOURNMENT There being no further business, the meeting adjourned at 7:28 PM. APPROVED THIS ~ DAY OF DECEMBER 2002. Fred P(~e, Chair ~ Da~.elle Daskam, City Clerk I:\clerk\finance\fcm~OO2fcrn 11-18.doc Page 5