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HomeMy WebLinkAbout2008-07-14• E IDIAN~- IDAHO MERIDIAN CITY COUNCIL SPECIAL MEETING /WORKSHOP AGENDA Monday, July 14, 2008 at 1:00 p.m. City Council Chambers 33 East Idaho Avenue, Meridian, Idaho "Although the City of Meridian no longer requires sworn testimony, all presentations before the Mayor and City Council are expected to be truthful and honest to best of the ability of the presenter." Roll-call Attendance: X David Zaremba )C Joe Borton ~ Charlie Rountree X Keith Bird X Mayor Tammy de Weerd 2. Adoption of the Agenda.: ~r~~~P 3. Presentations and Discussions of the Proposed Enterprise Fund Budget (approximate times): ~'reS,~ 1:00 pm Introduction /Preparations 1:15 pm Enterprise Fund 5:00 pm Council Budget Decisions Meridian City Council Special Meeting /Workshop Agenda -July 14, 2008 Page 1 of 1 All materials presented at public meetings shall become property of the City of Meridian. Anyone desiring accommodation for disabilities related to documents and/or hearing, please contact the City Clerk's Office at 888-4433 at least 48 hours prior to the public meeting. ~E IDIAN* IDAHO MayorTammy de Weerd City Council Members: Keith Bird Joe Borton Charles Rountree David Zarernba • NOTICE OF SPECIAL MEETING / WORKSIiOP MERIDIAN CITY COUNCIL NOTICE IS HEREBY GIVEN that the City Council of the City of Meridian will hold a Special Meeting /Workshop in the City Council Chambers at Meridian City Hall, 33 East Idaho Avenue, Meridian, Idaho, on Monday, July 14th, 2008 at 1:00 pm. The Meridian City Council will be discussing the following agenda items: Presentations and Discussions of the Proposed Enterprise Fund Budget (approximate times): 1:00 pm Introduction /Preparations 1:15 pm Enterprise Fund 5:00 pm Council Budget Decisions The public is welcome to attend. DATED this 10~h day of July, 2008. .~ ~, YCEE L. HOLMAN - C ~' ~ ~ o B~AL = w, ,~~ '-, r~s~• ~,~ Meridian City Council SpeciakVVo~kshop /Meeting -July 14, 2008 All materials presented at.public-meetings shall become property of the City of Meridian. Anyone desiring. accommodation for disabilities related to documents and/or hearings, please contactahe CitjeGlerk-s Office at 888-4433 at least 48 hours prior to the public meeting. Meridian City Council Special Meeting July 14, 2008 A meeting of the Meridian City Council was called to order at 1:00 p.m., Monday, July 14, 2008, by President Charlie Rountree. Members Present: Mayor Tammy de Weerd, Joe Borton, Keith Bird, Charlie Rountree and David Zaremba. Others Present: Bill Nary, Tara Green, Anna Canning., Stacy Kilchenmann, Todd Lavoie, Rita Cunningham, Tom Barry, Public Works personnel. Item 1: Roll-call Attendance: Roll call. X David Zaremba X Joe Borton X Charlie Rountree X Keith Bird X Mayor Tammy de Weerd Rountree: Okay. We are ready to open the budget workshop at 1:00 o'clock for Public Works. Stacy, did you have some comments you want to make first? Okay. Excuse me. We need a roll call to make it official. Green: The Mayor will be late Item 2: Adoption of the Agenda: Rountree: She will be .late. And the next item on the agenda I need a motion to adopt the agenda. Borton: Mr. President? Rountree. Joe. Borton: I move we adopt the agenda as published.. Zaremba: Second. Rountree: Moved. and seconded. All those in favor? Opposed? MOTION CARRIED: ALL AYES. Item 3: Presentations and Discussions of the Proposed Enterpirse Fund Budget. Introduction/Preparations Enterprise Fund Meridian City Council Special Meeting. /workshop July 14, 2008 Page 3 of 61 the putting together of this presentation. Bob Field is a volunteer who works for us and he did a lot of the behind-the-scenes work as it relates to rates and benchmarking. Certainly Clint Dolsby, our acting city engineer and Kyle Radek, our assistant city engineer, had helped substantially provide an enormous amount of information to -- to this presentation., as did Rick Clinton and Tracy Crane from water and wastewater. And, then, our consultant Ed Squires was also instrumental in putting information as related to water infrastructure and future needs. Here is the agenda for today. We have quite a bit of information to cover and as Stacy mentioned, this is going to be a bit different, I think, than you -- than at least I have been told you have been used to. I thought we would frame the meeting with a brief agenda. We will go quickly through our departmental information, including who we are, what we do, and who we serve. We will move onto an accomplishment section that holds us accountable to things you charged us with last year. We will, then., look at the Enterprise Fund status, looking at both trends and statistics, sort of benchmarking where we are and where we have been. We will look at the Fund administration study that we worked together with finance on. We will review the administration practices that we have evaluated. We will look at the findings and., then, also I will propose recommendations as it relates to that study: Then, we will get into the fiscal year '09 budget. We will talk about our base and our enhancements and our capital replacement needs. From there we will move on and talk about at least from where we sit now our best guest as to future needs and projections as it relates to ..primarily water and wastewater utilities. Then, having accomplished that, we will take an intermission and, then, after the intermission we will come back and we will begin discussions on the utility rate history and, then, look at the rate model results. We were asked to run three models as it relates to rate history -- or, excuse me, not rate history, but rates -- rates for the Enterprise Fund.. Those models will be discussed. We will talk about the assumptions and the approach that we used, as well as the scenarios that we ran and, then, compare those to regional benchmarks as well. We will follow up with a summary and a conclusion and, then, allow time for questions and answers. So, moving onto our departmental information, the Enterprise Fund houses four divisions, if you will, or work groups. The Public Works division or work group, which is 24 employees or 28 percent of the Fund. The water department, which is about 23 employees or 27 percent of the funding. Wastewater Department, 32 employees, or 38 percent of the funding. And., then, we have six employees from the utility billing component of the Enterprise Fund or seven percent. Here are the general functions. You`re pretty familiar with these. I don't think anyone in the audience is new to this, so we won't spend any time, but, essentially, this categorizes very, very briefly and succinctly our general components under each of the divisions I just mentioned. Here is our infrastructure map as it relates to how Meridian is shaping up, at least through time to presently. This year we added one new drinking water well that was the Bitter Creek Well. We also added eight miles of new water lines and seven miles of new sewer lines. You will notice that those numbers are markedly different than the numbers presented last year. We ,had double digit mileage increases for both water and sewer. Both last year and the year prior. We have added five new pressure producing valve stations and, then, we added almost a -- well, 928 residential accounts, 120 commercial accounts, and 42 sprinkler accounts. Our existing infrastructure information is up there just for your reference. You know, essentially, we have as a total Meridian City Council Special Meeting /Workshop July 14, 2008 Page 5 of 61 cross-disk filters to provide redundancy for that filtration system and. to help us with our water reuse project. And, then, finally, wastewater pretreatment program information was submitted to the Environmental Protection Agency for review and approval and we are waiting on that. Here is a couple pictures of the plant improvements. As you know, we have -- the plant's been under a 22 million dollar expansion. Here are a couple of photos from that expansion. This particular -- these particular photos come from the stream expansion project, which includes the addition of two aeration basins, a primary clarifier, and a secondary clarifier and we are modifying the overall processes for liquid stream for a total cost of about 8.4 dollars. The project is substantially complete, as I mentioned earlier, and will help us increase our overall stream rate capacity by 65 percent. The bio solids improvement project is nearing completion as well. This project included the addition to two digesters, a control building, a centrifuge, with modifications also to the existing processes, for about 10.3 million and we hope that start up will begin in August of 2008. Here is the lift station I spoke of just a little bit earlier. We have provided quite a bit of information on this. So, I won't spend anytime on it, other than to show you at least the latest .photos as it relates to overall construction process -- or progress, rather. One of the things I'd like to comment on briefly is the recalibration of the effluent flow meter at the wastewater treatment plant and this is important, because we brought in an independent certifying agent to come in and have a look at our effluent meter and help us to understand -- you know, just to make sure that the meter was reading accurately. When that work was done we found out the effluent meter was reading high. As a matter of fact, upwards of 400,000 gallons per day high. When we recalibrated that -- and that's what you see in the graph there. You see an immediate reduction, essentially, in the amount of flow at the plant because of the recalibration, so -- so we gained, essentially, by recalibrafiion of the meter -- it just happened to work out in our favor -- we gained almost half a million gallons of capacity. at the plant per day, which is fantastic. Addifionally, I wanted to comment that our optimization efforts have yielded us about 1.2 million gallons a day of additional flow, which the Department of Environmental Quality has approved and we have also noticed the Environmental Protection Agency on that statistical analysis. So, with total improvements and upgrades, our plant capacity will be greater than ten million gallons per day by year end, which is wonderful. We have got quite a bit of room there for continued growth. Moving to GfS division accomplishments. Several accomplishments in the GIS work group have been achieved. We converted our water model into GIS. We also created a direct link from GIS to digital record drawings. This helps us easily access information electronically and reduce paper waste. We created a direct link also from valves and GIS to valve maintenance records, so that staff can download that information arid access it easily. We expanded also the number of GIS users in water and wastewater engineering development services and also planning staff as well. In the future we will convert the sewer model into G1S and this will allow us to model, as well as more easily track information in our Geographic Information System. We also enhanced and are updating an accuracy processes and expand our user count. That's the hope at least. We also want to increase the training of GIS users, so that we can put more powerful tools in their hands and help them to .pull information off the system that's' readily available for their use and create data layers of all past city projects with links to the digital record drawings, again, increasing access to information that we currently house. Meridian City Council Special Meeting /Workshop July 14, 2008 Page 7 of 61 work more. and more toward the ability to use both trending and projecfing as it relates to the development of our budgets and the adjustments in our rates moving forward. We believe that this is a more responsive and reasonable way to move forward the utilities overall, small changes over time to help us achieve the goals that -- that we feel we need to achieve as a utility. So, here is an historical perspective of revenue over time. You know, we had quite a bit of revenue from '02 increasing up to around '05, a lot of this is related -- I have got to get used to these buttons.. A lot of that is related to developer assessments and, you know, a lot of other things. But after around FY-05 we start seeing revenue dropping off. The revenue drop off is related to a couple of things. One of the things it relates to is the economy. We are seeing less development revenues. As I just mentioned, we took in about two and a half million less -- or believe we will for fiscal year '08 alone, but also the revenues are decreasing as it related to usage, because we charge by the gallon, essentially, by the thousand gallons in water. What you can see over time here is that in 2002 our average users were around 15,000 gallons for water. Now, that usage has come down over time and as that usage comes down over time, so does the revenue associated with the sale for water. We do see a bit of an increase here in 2007. That correlates pretty well with the overall change in climactic situation last year when we had, essentially, a very dry season and irrigation water turned off early and we believe that a lot of folks continued to irrigate with city water, just converted over and irrigated with city water and that explains in part some of the usage increases there. So, essentially, wastewater, as you know, is an average of winter usage and so we see it a little bit more steady, increasing and decreasing throughout the years, but, really, the revenues -- the loss of revenue, as you can see, as it relates to usage correlates fairly well with -- over time. Here you go projecting -- or not projecting., but trending backwards the revenue per customer. You can see that in the water, which is the bottom line, and that relates to usage in large part, we were getting about 240 dollars per year in 2001 for each water customer and 2005 that dropped to a low of about one -- what would that be, 155 or so. One fifty there, It's come up just a little bit and, again, we believe that this is related to usage during -- for irrigation -- supplemental irrigation usage. That wastewater -- again, you can see sort of ups and downs. I'm not really sure about this data point here, but this is -- this is what the data we are trending at least historically. As you know, our operational expenses continue to rise. We take on more infrastructure, more lines need to be cleaned.., .more valves need to be exercised, booster stations and lift stations need to be maintained. So, we continue to have an increase in our operational expenses, but what you will notice here is that we have flattened out a little bit between '06 and '07. Again, I don't have '08's numbers yet, .but we do see a break here and a flattening out. We believe that '08 will show that. and particularly '09 when we get into the discussion of our budgets you will see that and we have really been able to, essentially, curb the increases in operating expenses moving forward. If you look at our capital construction expenses over time, you can see some variability between 1999, essentially, and about 2003. But, then, after 2003 you see a marked increase in the investment related projects for the utility. So, I'm just trying to paint a picture here of revenue decreases over time., increases in costs, because we are getting to a couple slides here that are going put all of this in perspective. Essentially, in 2007 we were over 20 million dollars with capital construction related expenses. 2008 will be a hefty year as well, but we Meridian City Council Special Meeting /Workshop July 14, 2008 Page 9 of 61 our capital infrastructure needs into the future. We also are looking at capital project financing. How do we finance our capital investments? We also want to look at debt coverage, because you may -- we may need in the future the ability to take on some debt to cover some of the obligations that we might be forecasting into the future and so if we were to have to do that we also want to make sure that we can cover that debt. Again, I mentioned reserve capabilities of the overall utilities and, again, as Stacy alluded., we did not in this study look at developer assessments, there just wasn't time for us to do that as it related to putting this presentation together. We hope to undertake that endeavor in the very near future.. So, the first observation that Finance staff and Public Works staff came to was related to fiscal reporting and accountability. Because we have one Enterprise Fund and we have a lot of divisions, as I mentioned at the 'beginning of the presentation, which draw their expense monies from this single fund.., when it relates to water and sewer it's pretty difficult for us to identify specific revenues and specific expenses in the water and the sewer utilities. These are, of course, the largest -- how do I say it? They, essentially, got the largest budgets of the entire Enterprise Fund and so we wanted to make sure that we didn't have one utility subsidizing another utility and there was really no way for us to know that until we broke out the revenues and expenses. Again, that made it difficult to identify the cash position insolvency of the water and wastewater utilities and so by -- and you will see we are recommending that at least internally we separate those activities, so that we can better track our revenues and expenses for each of the utilities. We hope that will improve overall fiscal controls of each of the utilities. We also found out that we need to improve the allocation of our funding, making sure That we place money where it is most needed. So, the recommendations as it relates to this first observation are to strengthen our fund reporting and reconciliation capabilities of overall fund activity. We also want to move towards the utilization of cash position for solvency. This will help us to quickly identify and position ourselves for adjustments that relate to overall cash positions of the utility. We also feel like we need to be doing a better job sticking to budgets as it relates to projects, as it relates to reimbursement agreements, as it relates to, essentially, everything that we are doing. I mean, again, 9.1' million dollars in amendments. for the year is not something we want to continue into the future. We also want to improve our project estimating capabilities and also tracking capabilities. We want to identify at least the Public Works budget gate keeper, somebody who is going to be looking more closely at both trending and projecting and financials as it relates -- the financials as it relates to the operation of the Public Works Department, utility billing, wastewater, water, we feel that that would be a major asset, because I think some of the signs that we see now were there a couple years back, if we had only been looking for them. So, we feel like -- we feel strongly that we need somebody to be looking at that and maybe the modifications that we will be talking to later in the presentation could -= could.. have been discussed earlier with less significant adjustments being recommended.. The budget amendment accountability -- I mentioned that. We definitely want,to make sure that we don't have many amendments and that if we have amendments that we are accounting for them. And, then, we also want to make sure that we are encumbering funds which as of the just a couple months ago we started doing, so this will vastly help us to improve our overall financial tracking. The second observation has to do with capital planning and financing.. We recognize that we have a near term financing Meridian City Council Special Meeting /Workshop July 14, 2008 Page 11 of 61 improve the number of projects we are working on. We because we -- we realize that we are really not spending much activity as it related to the overall project and we projects or utilize our time elsewhere to -- in the utilities. De Weerd: Tom? Barry: Yes, ma'am. De Weerd: I think Mr. Bird has a question. Barry: Yes, sir. could take on more projects, as much, so there is not as can assign them additional Bird.: Tom, when you award the contract do you award it for the 2,225,000? Barry: Yes, sir. And that's agood -- Bird: And., then, what's going to guarantee if they only do 125,000 in '09 or 350 in '10 and -- in '11 they are only going to do 1.7. Barry: It's a different way of budgeting, IVIr. Bird, and so -- and I have used this for a number of years in my past work, but, essentially, what you would have to do is change -- the Council would have to approve the project in its entirety, okay, but, then, only authorize the expense of the funds as outlined in the year that we have requested it. We would also have contingency monies appropriated to this, so there would, in each of these, have a certain line for contingency and let's take the water reservoir project, the 125 here could represent say for example the acquisition of easements, the filing of permits, and the preliminary design. And that's all we would scope for 2009, because we know how long that will take and we know that we can't really do much more than that with all the other things going on, unless it's a priority project and we condense the project life cycle. So, what we would do is we would ask the Council in 2009, let's just say, for the 2.25 million dollars, but only to authorize the appropriation of 125,000 for fiscal year '09. What this does is it commits us to the project, so that we know the project will be completed and that Council has approved the project in its scope and in its essential overall purpose, but Council will only be allowing, essentially -- and it's tied to each fiscal year -- the authorization of the monies needed in order for those phases of the project to move forward.. Does that answer the question, Mr. Bird? Bird: Well, it answers the question, but I don't agree with it. Barry: Okay. Bird.: I don't -- I think instead of simplifying your accounfing you're adding to it, but that's just my pea brain. Go on with your report. Meridian City Council Special Meeting /Workshop July 14, 2008 Page 13 of 61 in the presentation. And we have very, very limited debt coverage capability. This is important, particularly if we get into a position where we are going to need to take on debt. Recommendations here are that we develop an additional dedicated capital improvement program or project revenue stream, which is financed from the rates. This would position the utilities -- not only would it help us to put -- place infrastructure where we would like infrastructure to be placed, it would also position the utility to take on debt, because currently we don't have a revenue stream by which we can take on debt. The monies that go to covering operations .and maintenance are not eligible, generally, for coverage as it relates to paying back your debt on a bond. If you also take developer assessments, which is another source, a main source of revenues for the utility, bonding companies will either not use developer assessments or use a very small percentage of developer assessment revenues as an adequate debt coverage payment. That means if we are only taking in on the order of three million dollars, for example, in developer assessments and bond company says, well, you can only use 20 percent of that, because it's a variable revenue. We are not going, to allow you to back a bond on variable revenue beyond a certain percentage and sometimes they won't at all. That means we really have no other way to cover any debt into the future, because we don't have a CIP revenue stream and., generally, that is the revenue stream that would be used to secure the debt and cover the debt into the future for years to come. Because we don't have that revenue stream, we are not in a .position to take on debt. The next thing I wanted to do is give you an example. We have talked to some bond agencies as it relates to coming up with a scenario for debt. The Idaho Bond Bank, as an example., would -- could issue municipalities a 20 year bond. This has -- this was as of two months ago. A year 20 year bond at four and a half percent would require one million dollars annually for every 13 million dollars borrowed. Okay. That's an important number. So, if we could cover a debt for a million dollars, our debt -- our debt liability would only be 13 million dollars and when you talk about a plan expansion that might cost you on the order of anywhere between 50 and 70 million., you just do the math and you can find out how much you would actually need in a capital transfer in order to cover the debt. The same thing applies to water infrastructure as well. So, four and a half percent bond., 20 years, four million dollars of debt coverage only gets you 13 million dollars of borrowed money. So, that's something to think about into the future. Borton: Mr. President? Rountree: Mr. Borton. Borton: Tom, do they -- do you have any information on the treatment of revenue streams from impact fees associated with these types of Public Works capital improvements? Barry: Well, yeah, the impact fees we are talking about developer assessments, I believe. Borton: No. If there were. If there were, we'd still exist now, but -- Meridian City Council Special Meeting /Workshop July 14, 2008 Page 15 of 61 money to do it. Right now our depreciation reserve is very, very small and it is one that does not compound over time. We, essentially, set aside a small portion of money and, then, if we don't use it, it goes away and we reprogram it for the next year with a very slight increase. That's dangerous as it relates to preserving the integrity of the systems we have into the future. We have no capital reserve. Now, capital reserve here isn't necessarily critical, okay? It would be nice to have, but usually capital reserves are either set aside as a capital reserve or they are the ending fund balance, provided that you have set aside an operational reserve and a depreciation reserve. So, capital reserve, not as much concern, although we can talk at more depth at the question and answer time as to what that might get you in the future. Recommendation here, of course, establish and set aside a six month operating reserve for both the water and the wastewater utility. That equals about four million dollars for both utilities. Addifionally, recommend the establishment and setting aside of a dedicated and compounding depreciation reserve that grows over time as our infrastructure ages. That's going to be, again, as I say, important to do over time. And, then, of course, establish a capital reserve, but as I mentioned, this is less important. You might be able to use the ending fund balance as an alternative. The fifth observation and the last observation is the -- it relates to anticipatory planning and budgeting. One of the things we want to do is make sure that we position ourselves for revitalization projects, that we also position ourselves to take on various plant upgrades or expansions and well infrastructure improvements and new well construction and also that we meet our regulatory compliance obligations as it relates to the operation of our utilities. So, for this reason one of the things we should think about is adjusting our capital planning and financing strategies to accommodate these anticipated needs. Again, this goes back to the way we have historically, as I understand, been budgeting and that is going year by year by year looking at revenues, looking at expenses, and making sure we have a positive number. So, what we would like to do is move that horizon -- the planning horizon and the financing horizon and strategic horizon further out, so that we are in a position to make adjustments now that make a substantial difference four, five, six, seven years into the future. So, with that we will go ahead and begin our discussion by the Enterprise Fund budget and talk about, first of all, the FY-09 base budget. You have this graph in your -- in your documentation there. This talks about total Enterprise Fund,, including enhancements for the fiscal year '09. You .will know that the total budget with enhancements is about 23.6 million. 2.1 of that's in Public Works, which is nine percent of the budget. About 640 of that is in -- or three percent is in utility billing. Thirty-four percent or 8.1 is in water. 11.3 in wastewater at 48 percent. One percent in other government, which we talked about in the General Fund presentation. And, then, about five percent in General Fund transfers, which support the operation of. the entire Enterprise Fund on a division. This is the Enterprise Fund base budget by department over time. We have got this graph again. Won't really speak to it, other than to say that we have had increases as we have grown as a municipality. One of the things we did in Public Works and Enterprise Fund wise -- wide, is I challenged the staff to bring forward., you know, a fiscal year budget for '09 that was responsible, but also responsive, and one that we would be able to achieve as much reduction as we could as it related to our operations and I'm pleased to report that all staff have risen to the challenge.. There is an exception, that's the wastewater group, and they rose to the Meridian City Council Special Meeting /Workshop July 14, 2008 Page 17 of 61 Radio read program. We are asking. for 183,000, in combination of both retro fit money and registers, 137,600 of that is for retro fit money to -- to add additional use to the radio read program. One thing that I do kind of want to go back and emphasize what Tom had mentioned earlier is that our overall water department budget is down nearly two million dollars from last year's request. We were at 3.9 million dollars last year and we are under two million this year. I think everyone is fairly familiar with the benefits of the radio read program, so I won't dwell on that. Consulting we are asking for 100,000 to provide regional water supply planning and coordinafion study solutions for the brown water .problem and pursuit of alternative water resources. Well rehab. This is a one time -- no, it's ongoing. We are asking for 150,000. I think we currently have been asking for 100,000 the last couple fiscal years and we are finding that that doesn't cover our rehab. So, we have upped it and we are taking apro-active approach that we would like to continue to do this in a more pro-active manner and stay ahead of the well rehab. Locating equipment. This is a fairly simple low cost request. Last winter when we were reading meters the snow prohibited us from finding the meters and this is just simply equipment to allow if we have another heavy snow fall year, we can find the meters, so that we can read the touch read meters in a very timely fashion. We were really handicapped last winter. Water line extensions. There is 585,000 dollars in water line extensions. A majority of that, I think 485,000 of it is for ACRD-related projects and there is 100,000 in there for flush lines to help us stay on top of the reduction in ground water that we had the pleasure of experiencing. Water main replacement. This is for the older areas of town that are outside of the downtown urban renewal area. You may recall that we had a water main rupture that got us in the news media a couple years ago and this was the start of wanting to allocate funds specifically to rehab some of the older part of town that aren't in that downtown rehab area. And, then, of course, the downtown urban renewal, we are asking, for 250,.000 there. Well 23 aquifer blending.. This one's a fairly important one to me. Our need is to reduce the uranium content in the existing well to below the MCL by either utilizing an on-site well for blending water or two separate aquifers -- with two separate aquifers or an aquifer storage and recovery project. Basically, right now we are only allowed to run that well 59 days per year, because of the limitation on uranium. So, we really want to see us get that well operable year around. Land and easement acquisition. This enhancement and the next enhancement both., I would like to point out to the Council we would request that both of these, even though they were submitted .as one time enhancement requests, are request is that they are ongoing and we have 50,000 dollars in acquisition and, then, we have another 75,000 dollars in just miscellaneous water system improvements. And I guess 1 would make that request to the finance division as well. And that's a summary of our -- of the water division. De Weerd: Thank you, Rick. Clinton: Do you have any questions before I step away from the mike? De Weerd: Council, any questions at this time? Borton: Madam Mayor? Meridian City Council Special Meeting /workshop July 14, 2008 Page 1'9 of 61 Clinton: Other questions? De Weerd: Anything? Rountree: Madam Mayor'? De Weerd: Yes. Rountree.: Question on the role as -- aquifer blending. You have identified two options to do that. What's the likelihood of being able to use the test well for blending and is there really a legitimate benefit crossed there? Do we know that that test well would provide us sufficient water for sufficient time to compensate for a half million dollars worth of expense? Clinton: We are about to enter a scope of service to do a study for that very thing. Originally it looked more favorable -- and., again, I'm not -- I'm not providing the consultant backed official opinion here, but I was originally hoping that we could blend the two waters and that's -- that has been my preferred choice, but it's looking like we have higher manganese in that lower aquifer and it seems to me like when we originally constructed the well we had a meeting and tried to decide which was the best aquifer to utilize. That lower aquifer, as I recall, also has higher uranium in it, so that's one of the tasks that will be coming up is to look at that and see if it is the most economical alternative to getting that well to come into compliance. The other one is aquifer storage and recovery and I don't have a whole lot of background and experience in that, but I have been advised by a couple different consultants that it may very well be a good option. I think the one thing that I want to clarify here is that a good share of this capital would be for the construction of it and not just -- that's not all just consulting money. Did that answer your question, Councilman Rountree? Rountree: Madam Mayor. I would hope that the study that you undertake would give us a benefit cost analysis and it may well be that we abandon that well and, then, we are looking at even a bigger expense. But in the long run it may be the appropriate expense. Clinton: Yeah. The one thing that I have seen trending around the Treasure Va11ey is that uranium is not affecting just the City of Meridian, it's affecting a lot of smaller wells and this particular well was drilled prior to that uranium rule coming online. But, yes, that's the goal is to identify those options. Rountree: Madam Mayor. My last comment is is that it may be better to budget the study this year and better budget the fix next year, unless we have a situation where we really have to get something done this next year to get that online. Clinton: And that's acceptable to us. Borton: Madam Mayor? Meridian City Council Special Meeting /Workshop July 14, 2008 Page 21 of 61 De Weerd: Thank you. Crane,: Okay. I will try to keep this as brief as possible. This first enhancement slide, what we are wanting to show here is that we have notably reduced the enhancement request this year. Total enhancements approved last year was 7.94 million. The total request this is year is significantly less at 2.46. Enhancement one, Professional Consulting Services, to define current and future operational and regulatory challenges and develop strategies for (unintelligible). Enhancement two is for chemically enhanced primary treatment. The chemically enhanced primary treatment aids in the removal of .phosphorus, helps prevent strubite formation and may increase the plant capacity by two MGD. The remaining chemicals are necessary to control foam and provide for increased use of bio solids polymers due to growth. Enhancement three is for sewer maintenance. We have an additional -- we have a need for additional sewer line cleaning. Currently we are on about an eight to ten year cleaning cycle, but we have a goal of three to four. We have fallen behind in this area due to increased amount of infrastructure and escalating cleaning cost. This enhancement will not bring the existing schedule current, but it will establish a new four to five year schedule. As a note, these funds are not needed if enhancement five is approved... So, we are going to continue with the theme of wastewater being different. We are going to skip the slides. Enhancement five is also for sewer line maintenance. It's for a sewer cleaning truck and a camera and a camera truck as well. bt provides for routine cleaning of sewer lines every three to four years. As I stated earlier, we are currently contracting arid falling short of the goal. We have about 500 miles of sewer and we need to clean about 130 to 180 miles a year to meet the goal. Right now we are doing about 80. So, I have sort of a summary slide of these two enhancements. De Weerd:: Tracy, hold on for a minute. Crane: Okay. De Weerd: Mr. Bird. Bird:: Yeah. Trace, on that, we would also have to hire personnel, wouldn't we? Crane: Yes, sir. And that's included in the ongoing cost on this enhancement right here. Bird.: And what would it be? Two people? Crane: It's two people to run the truck. Yes, sir. Bird: And one other question, Trace. Do you have an idea of what we spend a year in outside contracts doing this? Crane: Well, we have -- originally we have budgeted for -- in this summary slide it's here. Meridian City Council Special Meeting /Workshop July 14, 2008 Page 23 of 61 Borton: Okay. Good. Thanks. Crane: So, now we will. jump back to enhancement number four. This is for computer software to improve effectiveness. An air compressor for servicing vehicles and for using air tools. Enhancement number six. This is for the design and installation of utilities in conjunction with ACRD roadway projects and other miscellaneous -- miscellaneous, excuse me, sewer line extensions and replacement. Enhancement seven is 125,.000.. This enhancement will provide funding for sewer improvements in the downtown corridor. We .are currently working in conjunction with the Meridian Development Corporation to identify sewer infrastructure needs in the downtown area. There is no eight. So, we will jump to enhancement nine. Enhancement nine is an ongoing -- is that correct? It should be -- that slide should be just an ongoing 100,000, not a one time cost of 100,000. This request would provide us a fund to design and build wastewater system improvements that are not accounted for in other funds. This would be an ongoing program that would build a fund to be able to seize strategic opportunity when they arise. And, then, we have enhancement number ten, which is for right of way, sewer line extensions, and this is for maintenance and repair of sewer pipe lines in the right of way from the property line out to the sewer main. And Tom is going to go ahead and present number 11 and, then, when he's done we can stand for questions. Barry: Okay. Enhancement number 11 is the enhancement we spoke about during the General Fund presentation that I'm bringing to the Council`s attention. It's a new ,enhancement. You may recall during the General Fund presentation Mr. Siddoway, the parks director and myself, had come up with a way to partner on the Heroes Park project. There is definitely an opportunity for the wastewater and water utilities to incorporate some improvements into the park as it relates to decreasing overall potable water usage., as well as increasing the amount of reclaimed water usage. So, for that reason I am introducing enhancement number 11 for a total one time cost of 378,000. The 78,000 of that would go to the Heroes Park project as originally scoped and designed. by the Parks Department. That 78,000 is for some engineering, as well as the bathroom improvements, since we have to separately plumb those for reclaimed water, and a couple other minor improvements, contingency, those sorts of things, to get us to about 78,000. We are also seeing an opportunity to expand by -- expand that project by incorporating infrastructure at the park that would help to bring or draw attention to the benefits of reclaimed water. We are not -- we want to make sure that the public has an opportunity to see firsthand the benefits and learn of them as it relates to reclaimed water and we think that Heroes Park has a -- would.provide a wonderful opportunity for us to do just that. We could be talking about small water features. We, obviously, are talking about the bathroom improvements. We could be talking about a water life garden and other sorts of amenities that would provide educational opportunities for the public to come and see the benefits of reclaimed water, since it is part of a larger strategy for us moving forward, we want~to make sure that the public is comfortable with the benefits of re-use and that they fully understand those benefits, so that they will work with us hand in hand in moving forward this important work. So, for that reason we are asking for a total of 378,000 #or first phase of the water re-use interpretive Meridian City Council Special Meeting /Workshop July 14, 2008 Page 25 of 61 may start talking about infrastructure to do this on a broader -- in future years, not this year? Barry: Yes, sir, that is -- Zaremba: Is that the direction we are going? Barry: That is the plan. This is the testing of the water, so to speak. We are not sure we can do the full test with 300,000., but we can get part way there. The goal here, again, is -- one of the biggest detriments in moving forward reclaimed water or bringing it into a community is the yuck factor. This is the community's tolerance for and often ignorance, really, .for the utilization of reclaimed water for a water source. There are many major benefits of reclaimed water as it relates to that use of that particular resource. If you compare, for example, water quality with typical irrigation water -- Mr. Zaremba, you asked the question at the General Fund presentation last week, I was nudged quite hard by our wastewater treatment co-manager, we have the information and we actually draft that information. It's remarkable, actually. The fecal coliform numbers in irrigation water, standard irrigation water, as well as the e.coli counts, are very high in irrigation water as compared to reclaimed water, which is very very low, largely because of the chlorination that we utilize for reclaimed water. Also irrigation water is not, from a water quality standpoint, regulated, but reclaimed water is heavily regulated.. So, we believe that utilizing the right -- the right water for the right use makes a lot of sense as you have suggested. In moving forward, if we are successful with the introduction of this -- of this concept in the community, we would like to move forward and expand that project into undeveloped areas of the community first, after which we can, then, talk about retrofits. But retrofits are, actually, very expensive as compared to placement of new infrastructure during the development process. So, I have worked with a couple developers already between those couple. We have identified about five or more hundred acres of the opportunity here. One of the developers is across the street from Heroes Park and so that would be a great first site.. We are currently taking statements of qualifications from four'different consultants on helping us put together a business case analysis for whether or not this makes sense logically, technologically, financially, on a lot of different fronts and we hope to have that information for the Council to consider into future. Regardless, we believe that this project here as presented will help fhe community, as well as the Council have afirst-hand opportunity to see just what the benefits are of reclaimed water and thus our introduction of it at this time. Zaremba: Thank you. Barry: We are very excited about it. Borton: Madam Mayor? De Weerd: Mr. Borton. Meridian City Council Special Meeting /Workshop July 14, 2008 Page 27 of 61 water, which is generally bracketed by whatever water allotment they have and what the climate is and so we know that using this on open space makes a lot of sense. We believe it makes a lot of sense, particularly from a best case analysis for bringing it to new development, but that is the study that we want. to do. This particular project doesn't even -- doesn't even touch or embrace any of that. This is just what can we do at the park. Let's get -- you know, one of the things is that if we did the best case analysis and we find out it works fantastic, but the community doesn't like it, it will fail,, as it has in many communities, because the communities haven't done their research -- they haven't really invested in educating the population to embrace and move forward the utilization of reclaimed water. So, I don't know if that helps explain at all or not, but that's our line of thinking currently. Borton: Okay. Barry: It also would help us to reduce phosphorus, which is an immediate concern at the treatment plant. So, it will be able to take some phosphorus loadings immediately out of the plant by applying this water to Heroes Park and other open spaces as well. So, that part we feel very comfortable with. Borton: Madam Mayor? De Weerd: Uh-huh. Borton: One last question, Tom. On the -- the enhancement, I think three and five, be either/or? Barry: Yes, sir. Borton: Is there -- if we had a decision point this year that -- by way of example, if we wanted to fund enhancement three, but the next year switch over and perhaps fund five, I mean is that an option or do you have to make. your determination and choose one? Barry: It is an option, Mr. Borton. You could choose to fund enhancement three. If you start the clock today, the pay back time equivalent would be greater than 49, as we have projected, .but certainly you could do that. Borton: Okay. Thanks. Barry: Uh-huh. Okay. This is just a graph of our enhancement history. Again, we are trying to be accountable for what we have done in the past by demonstrating how we have performed. You ,will see it as gross picked up, so did our request as it related to capital infrastructure, largely through enhancements. 2007 it dropped significantly off. 2008 you can see where it is. And, again, compared to 2009, we do see about a 26 percent reduction in overall enhancements between fiscal year '08 and fiscal year '09. So, again, we are trying to tighten our belt, along with all of the other departments as it relates to base operations and our enhancements for capital infrastructure. This is a Meridian City Council Special Meeting/ Workshop July 14, 2008 Page 29 of 61 for us to do that. Intra-tie connectivity. One of the things that we were -- we wanted to discuss, at least with our neighbors, is the possibility and/or viability of us interconnecting some of our resources. This would be particularly important when we have times of crisis or in climatic severe long term climatic fluctuations where we may need., as a community, to come together and rely on one another in order to sustain our individual communities. So, there needs to be some study on that .and possible -- that might end up being possibly projects. Of course, this would be something that we would need leadership and guidance from as it relates to the Council. So, we would not be moving forward on this without Council's authority. But it's just one of those things to be thinking about. Conjunctive management's already here, although we have our consultants diligently working on whether or not Meridian should be a conjunctively managed municipality. What their consulting costs, legal costs, a bunch of other costs associated with conjunctive management, which we are currently wrangled into. So, we have needs in that area as well. Water rights issues. Well abandonment. Acquisition of new rights. Those are very, very important things for us if we want to continue to prosper and continue to grow as a municipality. So, we are going to need to devote resources to that as well. We have some aquifer characterization studies that I feel strongly we need to be pursuing. We don't really know what's below our feet. We have an idea. We know we are pulling water from below the ground. We don't really know which aquifers have what kind of contaminants or which aquifers have different kinds of concentrations of contaminants. We don't know the volumes in those aquifers. We don't know the recharge rates. We don't know -- we don't know a lot. We don't know very much at all, actually, about our sub surface water resource and it makes a lot of sense for us as we continue to see growth in this valley to invest~in understanding the resource from which we sustain life beneath our feet and get a good handle on introducing strategies and technologies and other sorts of things to make adjustments into the future, again, to be -- to be considerate of our citizens and also prosperous as a community. The aquifer storage and recovery. This is -- this is a strategy that is used to rehabilitate wells that have full water quality. It's not always successful, but it is a project where oftentimes we can amend in situ, that just is a fancy word for in place, the geochemical characteristics of the -- of the aquifer and at a later time pull up a better water quality. That is at least the hope through geochemical restoration of the resource at the well head. Mr. Bird, it looked like you had a question. Bird: Yes, I did.. Madam Mayor. Tom, on the storage and recovery on the aquifer, water -- that reclaimed water that we are getting out of the plant, is there any way we could get that to get in =- back into the aquifer, because by the time it got down there would think it would be beautiful purified water. Is there any way we can -- if it isn't successful putting in lines throughout the city, is there any way we could at least dump it back into our aquifer at different locations? Barry: Yes, sir. I like your thinking. IYs very visionary. And the next slide -- when we get to the wastewater department -- Bird: You're one step ahead of me, then. Meridian City Council Special Meeting /Workshop July 14, 2008 .Page 31 of 61 sustainable or arguably is sustainable, this is just an .average. So, you know, we could have years where we are at six, eight, ten percent and years we are at two and if you averaged it out over time at four percent, this is what you would look like. Each of these little arrows is a development of a new drinking water well. So, over that period you have got ten to 12 wells between now and, essentially, the next 22 years. That's about a well every other year for the most part on average. And that's just something to think about when we talk about well development costs and production costs being about a million dollars for a new well, so -- so this alone, just growth related infrastructure, represents, over a 22 year horizon, about -- and this doesn't include construction costs inflafiion, but, essentially, you're talking about a million, so you have got ten to 12, so talking about to ten to 12 million just for new wells. Doesn't include new lines or treatment or booster stations or any of that kind of stuff. De Weerd: So, that includes new wells and replacements? Barry: No. Just new wells. De Weerd: Now, if new wells serve 4,000 homes -- Barry: Uh-huh. De Weerd: That's pretty aggressive compared to over the last couple years what we have added.. Barry: We have added quite a bit and a lot of that's for fire flow. A lot of that is for development of .pressure states -- pressure zones in the city. There is a lot behind the investment in the wells in the past and., arguably, we weren't necessarily from a water capacity standpoint and we are trying to get the numbers out of the SCADA systems. We have a feeling that we weren't and maybe even, at least in one pressure zone, not able to achieve the kind of capacity requirements we would like as it relates to the water infrastructure. We may not have enough -- enough reserve supply of water in certain zones as we would like and I'm trying to pull that information out of our SCADA system and we haven't been able to do that just yet, so we hope to have that information at some point in the near future. Bird: Madam Mayor? De Weerd: Mr. Bird. Bird: Yeah. With your projection -- and I don't think you are too far off, if you don't hit four percent, but I think you're going to need 11 new wells over that many years, 22 years, but what about water rights, Tom? You know, that -- if you don't have water rights you're not going to drill a well. Barry: This is correct, Mr. Bird. Each one of these new wells would require a new water right. Meridian City Council Special Meeting /Workshop July 14, 2008 Page 33 of 61 Barry: Okay. We are, as you know, in the middle of a departmental reorganization, a realignment with staff, and what we are trying to do is retool the resources, so that we can focus on these planning efforts, because right now we don't really have the staff to be doing this work. Does that mean we need new staff or we can reposition existing staff -- we are going through the process now to answer those questions and I hope to be able to bring that back to you and have the Council's guidance as an input as it relates to that. But I just wanted to say, yes, we see a need and this is just the water department. We need to make sure that we have adequate resources to put to this need in order to get the work accomplished. Bird.: Yeah. You're right. De Weerd: Mr. Zaremba. Zaremba: Madam Mayor, Ijust -- just in a similar vein, I would add that this slide also shows the importance of doing aquifer studies. I mean fhe question is by the time you get to well number six will there be water to draw: Barry: I really appreciate the Council's forethought in this, because that's, again, visionary and it's absolutely critical that we -- that we do just that. We don't want to be continuing to invest in the sub surface aquifer if its yield is going to be decreasing over time and it won't produce, so why invest that -- those resources into the aquifer, why not look for an alternative source. So, that's absolutely something we want to do. Thank you, Mr. Zaremba. Zaremba: Thank you. Barry: Okay. I just -- just for giggles. Some of you may not appreciate this slide, but I just wanted to show you the difference between a three percent growth. This slide we talked about already, is four percent growth and the timing of new well infrastructure. This is what seven percent growth looks like. In this particular scenario we are talking about -- instead of the ten to 12 drinking water wells over the 22 year period., we are talking about 25 to 27. Now, this is at seven percent growth. As you know, we had about two or three years of 15 percent growth. So, you know, we know that's an anomaly, but is seven realistic going forward into the future? If you look at population trends nationally and internationally, what we are seeing is that the population curve is a J curve, it is not a linear curve, and we will continue to see. more and more people tomorrow than was here today and so on and so forth into the future. So, I don't know if it's seven percent growth, I just wanted to throw it out there to show you what the difference of just a menial three percent does as it relates to infrastructure. These slides are important, at least in discussing how we need to look at developer assessments into the future, which we haven't done as part of fhis study. t_et's look at wastewater. We know wastewater has future needs and -- and we did the same exercise for wastewater as I just did in water. We know that the regulatory environment in wastewater is pretty high. We have a lot of things that we need to be thinking about. One of the biggest ones that is right on the edge, we are getting the ruling we expect Meridian City Council Special Meeting /Workshop July 14, 2008 Page 35 of 61 De Weerd: Tom, how does that happen if -- at a local level? I can't imagine code enforcement going out and checking everyone's. cupboards. That -- you know, how does that work if it's not a statewide initiative? Barry: Madam Mayor, I'm not familiar enough with those types of programs to be able to comment intelligently, but I can tell you that there are municipalities out there that do sample the storm drains coming off of various sectors of the community and utilize those water quality indices to, then, come up with fees associated with whatever constituent is trying to be controlled. So, there are ways to do some of that stuff. I have no comment as it relates to how we might want to think about that. Certainly, a lot of regulations on the books go unenforced and it's really just a strategy for EPA, you know, or for the community to say we are trying our best, but a lot of times there is not staff resources or there isn't financial resources for the monitoring and enforcement of those types of programs. Again, that's why we want to look at it as a strategy and identify whether or not it was a viable strategy for us to pursue. De Weerd: Thank you.. Barry: Phosphorus is not the only constituent we have concerns about. We have other nutrients in nitrogen and other sorts of things at the plant, which are coming. We don't know when they will get here, but we know that they are coming. The requirements environmentally have tightened over the years and will continue, I imagine, in the future to do -- to do so. Water reuse, an area that we'd like to begin exploring as an opportunity for us to divert loads for whatever constituents might be coming through the plant. Imagine for a moment if we had a treatment plant in which all of the resource that we currently waste to the stream and it's highly regulated and that alone requires us to meet certain types of environmental requirements, is all of a sudden gone, because the resource is pumped into the ground or it's used through water reuse programs to irrigate the various lands around the city. Imagine if we d'idn't have to invest in those or worry about those -- many of those types of environmental regulations, because the resource was diverted from surface waters, which are waters of the United States, and, therefore, under the jurisdiction of the Environmental Protection Agency. So, something to think about as part of our overall strategy. Again, water reuse, a big component of that. Aquifer storage. Again, Mr. Bird and several of you have mentioned this. What if we just took the water and put whatever we didn't use back into the ground and -- whether we used it or not, we'd put it into the ground, would that be suitable for us to help off load the loadings for various constituents. We don't know that yet. We will have to look -- you know, talk with the agencies, -talk about aquifer characteristics to know what can go into the aquifer. We can't mix and pollute and those kinds of things in the aquifer, so we want to look at that holistically as well. In flow and infiltration continues to be a problem for us. As you know, particularly during irrigation season, a lot of fiimes we will have gains in the plant from water that comes from groundwater through flood irrigation.., cracks in pipes and whatnot allow for the seepage of groundwater into our pipe network and, therefore, what you see on the graphs oftentimes is higher flows at the treatment plant during the summer months and a large part of that is due to in flow and infiltration. Meridian City Council Special Meeting /Workshop July 14, 2008 Page 37 of 61 Barry: We tried to be sensitive about that, Mr. Rountree. Here is 20.08. We are coming off of a 1.2 million gallon flow improvement. Basically, this is our statistical analysis through optimization and a 22 million dollar recent plant expansion, which took us from about seven million gallons to about ten million gallons. If we can get chemically enhanced primary treatment, which is in enhancement that we submitted to you today for your consideration., we believe we can .add another two million gallons of capacity for only a million dollars. I mean that's a steal. Of course, it's not as big a steal as doing the analysis here for pennies on the dollar, really, and to get 1.2 million gallons of capacity. So, if we can add two more million gallons per day flow in the next year, we would be sitting pretty well, at least as it related to four percent growth.. We wouldn't have to have our next construction completed until 2023, back off four to five years from that to start your design and your, permitting and all that kind of stuff, you need to start spending money probably in 2018, 2019, maybe 2020. So, again, we are moving forward and we need to just be considerate of these intersections here, because we want to be prepared for that and embrace that. So, here is what you see, what we expect in order to get five million gallons of plant expansion. It's escalated.., meaning we have inflated the cost, because of inflation over time. If you did that, in 2024 that's going to cost you about 76 million. So, if you take a phosphorus, CEPT, and five million gallons of expansion between now and 2024, you're looking at what? Bird.: A hundred and eleven million. Barry: Exactly. A little over a hundred million. 'So, we have got some challenges as it relates to moving forward. Bird: Madam Mayor? De Weerd: Mr. Bird. Bird: I got a question, Trace and Tom. For our expansion and what we get, I don't believe Meridian, within the next 50 years, is going to get 180,000 people. But, anyway, if they should., have we got enough acreage out. there? Because I do know there is some property that we had looked at around thereto buy that attaches to it. Is that 47 acres big enough to double this plant? Crane: I'm not sure about double. I know that there has been plans for the five -- the extra five that's shown up there in the back of the plant property that we already own and, then, there has been several approaches that you can take to add membranes and maybe get it up higher than that. I am not sure I would commit to saying we could double it to 20 million. I think that's our goal -- Dan's shaking his head yes. So, essentially, they are saying we can double our capacity on the site. Bird.: On the existing 4'7 acres. That's what I have always been told, but I just wanted to make sure that -- Crane: I see our consultant out there shaking his head yes. Meridian City Council Special Meeting /Workshop July 14, 2008 Page 39 of 61 Barry: Okay: So, we have explained this slide, again, just to see the difference between three percent growth, you get something that looks like this. So, at seven percent growth we see that we need to make our first investment, not at 2024, but at 2017, which means three to five years behind tha# we need to have money in order to do this. That's 1'09 million to get a nine million dollar plant expansion with an escalated cost and.., then, again, over a very short period of time another nine million gallon expansion at 138 million dollars escalated cost in order for us to keep up with steady growth of seven percent on average into the future. Again, who knows what the growth rate will be. I just wanted to throw it out there, because if we don't at least look at it, we won't be able to know what it looks like later. So, in any event, the last thing is food for thought and the Mayor pointed this out. We have about 3,500 homes, which equals one new drinking water well and 4,000 homes .is roughly equivalent to one million gallons per day of plant capacity. So, as we continued to grow, you know, multiply those home numbers by about 2.96, which was the 2000 census, and that's what the population is and that's what we used in the graphs prior to this. So, we know that the demographics are changing, we know that the overall population growth rates are changing, but we of least have some idea as how that impacts our ability as a utility to move forward into the future.. So, with that we will go ahead and take an intermission and I think some of our staff has treats for the Council. De Weerd: Hey, Tom, before we break you want to introduce everyone in the room you have with you. Barry: Absolutely. Okay. Not from our department, but certainly an important -- in a supporting role, Mr. Bill Nary on .the far right there. Stage left. De Weerd: Low hanging fruit. Barry: Dan Aires in the back row on the -- on your right is our consultant for CH2M Hill, working with us on the improvements to the wastewater treatment plant. He helped put some of these slides together and I appreciate his time and effort. We also have Dennis -- oh, Dennis, what was your last name? Yeah, that's why I can't remember. Dennis Calinado for Wilbur Smith and Associates. He has been instrumental in helping us with our storm water program, as well as some other projects we have going on around the city. Let's see, again, important, but part of our department, the Planning Director Anna Canning. You know Stacy. I can't see everybody. So, Stacy, Rita, and Todd. Absolutely critical. I cannot say . enough good things about our finance department. Bird.: They have got -- they have got the quarters out to give you. Barry: They are great and I will be given them dollars today, so that's great. Bird:: Wow. Meridian City Council Special Meeting /Workshop July 14, 2008 Page 41 of 61 we need to take this out, we need to take three to four months of operating reserve out. And., then, we have -- the other typically use is the Capital Improvement Fund, which we do have the Capital Improvement Fund that we have used for the whole city on the General Fund side and a lot of the -- I think the thinking in the Capital Improvement Fund was if the Council wants to identify -- like doing a savings account and they want to identify what they are saving for, so it's -- instead of just having to go back and look through the financial records and say, yeah, this came from here and this came from there, it's a way for the Council to say we have identified this source and we want it to go here. So, it's kind of a controlled tool or monitoring tool. In the case of the Enterprise Fund, they are quite a bit different, because they are afee -- they are afee -- they are run by fees. They are like a business. And so, typically, in a business it becomes more important to identify like a reserve for depreciation, a reserve for capital improvement, an operating reserve, and we just haven't done that with the Enterprise Fund, we have just chunked it all into one fund., so I don't -- does that answer your question or -- Zaremba: It does. Kilchenmann: Or does it make it more confusing? So, on the General Fund side it's more of a Council tool and like we talked about the public reserve -- or the safety fund and the -- public safety is about 80 percent of our budget and so if there is savings it's usually they can generate them, which doesn't say that that should all go into public safety, but when you have some large projects like you do, it's a way to start saving for those and identify those funds and I think that was the thinking like with the fire truck fund when it was set up, you knew you couldn't buy a fire truck in one year, but you wanted to keep working toward that goal:. And so it's just a formal way to do it, I guess, rather than doing it with, you know, an Excel spreadsheet. Zaremba: Thank you. Bird.: Madam Mayor? De Weerd: Mr. Bird.. Bird: Stacy, correct me if I'm wrong, but, David, what I was told was the Enterprise Fund is strictly fee driven. No tax dollars go to the Enterprise Fund. , Kilchenmann: That's correct. And there actually are entities that do use tax funds for an enterprise fund. McCall is a good example. Bird: Well, we don't want to be like McCa11. Kilchenmann: And we don't want to be like McCall. That's a example, not agood -- well, agood example of -- Meridian City Council Special Meeting /Workshop July 14, 2008 Page 43 of 61 Baird: He likes you to be visionary now. Kilchenmann: I'm trying. Bird: Thanks, Stacy. De Weerd: Okay. Anything else, Council? Bird: No. De Weerd: Thank you. Tom. Thanks, Stacy. Barry: Thank you, Madam Mayor, Members of the Council.. It's my pleasure to reconvene and continue the discussion regarding the fiscal year '09 Enterprise Fund budget. As you know, on the agenda that we talked about earlier, we were going to spend some time discussing the rate models that we came up with and the scenarios that we ran under the rate model and so the next portion, essentially, from now until the end of our presentation we will be talking about the need for us to move and look forward. We have talked a lot about what we have done and how we have performed in the past five to six years and we have talked to you about what we need currently and., then, now we are going to transifion and speak to you about what we need to consider as we move forward and how we be ieve the projections that we~have identified here require changes in what we do today to insure that we can embrace those funds and challenges into the future. So, the next portion is on, essentially, rate history, rate setting, trending., those sorts of things. And I will start by saying we, the department, as Public Works Department, as well as Stacy I know in fihe Finance Department, need your guidance and direction as it relates to this next section, because so much of what we do, as you know, is based upon the fee structures or the rate structure, rather, that we accommodate as a utility and so our budgets and our strategies and our initiatives and the infrastructure investments and all of those things are dependant wholly on what that fee structure or rate structure looked like. If we don't have the monies associated with the strategies we want to move forward., then, developing those strategies is really a fruitless effort. So, we really do need your guidance and we don't expect, necessarily, answers today, but we expect this to be a primer for discussion into the future and certainly if you could give us any direction at all as it relates to what we talk about here, so we can go back and bring you. things to consider or whatnot, we would welcome that. So, without further adieus we will begin our discussion, essentially, on the rates. The first slide here that we are going to talk about is to look at how we did as it relates to our rate history. If we look at just the water utility and the wastewater utility, which, essentially, are the largest earners in the Enterprise Fund -- and this is because we do charge -- it's a service based utility, so we charge people fees or rates, if you will, for the services that we provide and that is providing the water service or providing them sewer service or both.. Here if we look at our water rate history, what you will notice is we have the water history or the rate history divided up into our base, our -- that's, essentially, the initial charge or your base that usually, you know, counts for a thousand gallons or four thousand gallons or five thousand gallons, depending upon what municipality you're Meridian City council Special Meeting /Workshop July 14, 2008 Page 45 of 61 challenges that we are experiencing comes from a reduction in rates. We also know that there has been recent significant capital spending, which has been fantastic for us, but we have had a lot of capital spending in a very, very short period of time. Most communities are doing that kind of investing over much longer periods of time and, therefore, have a longer horizon on which to -- to make savings and save up to -- if you're using a pay go or pay as you go policy. So, we have had very short spending. We have reimbursement agreements. The initial pay offs that we made, as I understand in the past as it related to reimbursement agreements, was a mechanism to help us alleviate some of the administrative perils associated with the reimbursement program., but those certainly had an impact on the overall fund balance and, then, we have many many reimbursement agreements that are being paid in full upon completion of the project work. I mentioned just in the last fiscal year alone through the end this year we will have about four and a half to five million dollars in amendments for a program we have only budgeted 600,000 for in reimbursement agreements. We are, as you know, moving forward to adjusting that policy and hope to bring forward to you through some workshop amendments to the reimbursement agreement policy and ordinance. We have declining interest rates, so we are earning less. It doesn't really impact us as much now, because we have less balances, but it certainly does impact us. Recent economic trends also are resulting in less assessment revenues. We mentioned -- or I mentioned earlier that we have about two and a half million dollars less in .projected assessment revenues for this year alone, largely resulting from development down turn in the economy. Rising costs of capital construction. You have certainly seen that we have increasing costs for materials. We have increasing costs primarily for shipping. We have increasing costs for oil products, like asphalt and other sorts of things. So, construction costs are increasing. And the next thing I wanted to talk with you about is to move forward into, essentially, the model that we put together for the Enterprise Fund. You may recall that we have used on our existing rate model, essentially, a one year model and this model was a complex model. It looked at several factors and it's a very good model.. But it has some limitations and one of the limitations is that it really is a blinder model., meaning it only looks at the year that you're modeling, and does not project out or has no capability of projecting out what you do today and how it impacts you in the near future. It can tell you whether or not you will be solvent for the year you're running the model, but it can't really tell you if you're going to be solvent years after that. So, with the help of the finance department, we worked together to develop amulti-year rate projection model. Now, what we did in this model is we separated the operations of water and wastewater. We wanted. to make sure that we could identify what the cost and the revenues for each of the utilities was. We, then, separated out from each of the water and wastewater utilities the functional areas, such as operations and capital. We not only wanted to see whether one utility -- what it was doing from a revenue and expense standpoint, but what components of that fund were actually -- we were actually able to cover. So, we separated out the operations portion both in revenues and expenditures .from the capital portion, both in revenues and expenditures for each of the water and the wastewater utilities. So, essentially,. you can imagine that we took the Enterprise Fund and we divided it up into four quadrants. On the left you have water operations and water CIP and on the right you have wastewater operations and under that wastewater C1P. And that's literally what we did. Then, we Meridian City Council Special Meeting /Workshop July 14, 2008 Page 47 of 61 Barry: Fantastic. All right. Well, up .here -- so, what I have done here is you have essentially -- this is the water .rates and you will want to get used to this graph, because this is going to be a graph that's going to be repeated several times, but with different numbers on it. So, what you have on the left side -- the whole graph is water and the graph on the right is wastewater. The first column here is the current water rates. The light blue is base rate and the green is usage charges. So, obviously, here -- and, then, the middle column is proposed.. So, we see no difference, because we said it was status quo. We ,are not raising rates. We are just leaving the rates the way they are, so you have., essentially, a zero percent difference in both the base rate and a zero percent difference in the usage rate. The same thing is repeated over here. Here is sewer. Sewer base rates. You can see they are the same, because we are not making any changes from current to proposed. And, then, sewer usage, they are the same, because., again, we are not making any changes from year to year, from current to proposed. Again, zero percent difference. We encapsulate the summary of the information down here by saying the average family water -- I'm not sure I can read that. Is 15 dollars and 16 -- $15.16. That would remain the same under the proposed, meaning status quo. So, there is zero percent difference. And, then, average family for sewer, this is an average family of four, $19.94. Doesn't change. Total bill $35.10. Zero percent difference across the board. The assumptions in all of the models have been the same. We have 8,000 gallons for an average water user and 5,000 gallons for an average sewer user. So, now having said all that, this is what no change looks like. The top line represents our cash position for the water utility. The green line represents our cash position for the wastewater utility. You will notice that zero is right here and runs across the. board.. What happens is that although our water utility can continue -- although it's somewhat flat, continue to maintain a somewhat healthy ending fund balance. The wastewater utility does not. Because we have separated these utilities out only internally and they are still one fund, when one fund performs poorly, so will the other. And what we see here is this red dashed line, because this is what happens to your overall fund balance. Now, the fund balance is actually much higher here. Going backwards it goes way up, because you got to add water and wastewater and your points up here would be higher, but I just want to show you where it deviates and you will notice that your cash position for the water utility begins to decline to make up the lost -- or the additional expenses for the wastewater utility. So, that means that the wastewater -- even though the water utility would be solvent, all through the five year scenario, your wastewater utility is not solvent, but what happens is that the wastewater utility in 2011 becomes insolvent, but it pulls down somewhere between 2011 and 2012 your overall cash balance for the Enterprise Fund, meaning that the entire fund becomes insolvent right around 2012.. That's important. What's also important here is that this scenario again does not include any reserves. So, nothing to fall back on. We are insolvent by 2012. So, that means., obviously, the status quo is not likely going to benefit us after 1211. So, we need to probably be thinking about what we can do. I just ran three scenarios and they are sort of high, medium, low, if you will, to give us a starting point of discussion. The second scenario is kind of the medium scenario. This scenario -- these assumptions include, again, all enhancements and base budget recommendations as proposed to you today. It includes an operational reserve. The Meridian city Council Special Meeting /Workshop July 14, 2008 Page 49 of 61 enhancements discussed, that's not changed. We are also including, just like in scenario two, an operational reserve of four million dollars. That covers both utilities. And we include a capital transfer. So, that's the same as scenario two. The things that differ are that we are adding a depreciation reserve in fiscal year '09 and that we are including some dollar savings -- we are setting aside money to respond to regulatory compliance needs in the future and we have quantified those regulatory compliance needs on the best available information we have to date. Again, keeping in mind we know we have an incomplete picture. If you look here at the model scenarios, what you end up seeing is that, again, related to current -- I will walk you through these numbers. The current base with 4.04 for water and 1.39 for usage, proposed base for water will be $5.34, with a usage charge of $1.84. Total dollar difference -- oh, excuse me. I'm reading scenario two again, Because I can't read the screen up there. So, let me start this slide over~if you do not mind and correct that. Okay. The water base., 4.04, again, is our current. And water usage is $1.39 current. We are proposing under this particular scenario increase -- let's see here. Okay. Increasing the base to 5.64, with a -- for water and an increase in the water usage to 1.94. The overall difference here in base is $1.60, with 55 cents for usage being the difference. Over on the wastewater side, again, current base is 4.74. Current usage is 3..04. Wastewater increases significantly in based to $12.43 and in usage to $7.97. The percent difference here, at least in dollars or the dollar difference, 1 should say, is $7.69 for the sewer base and $4.93 for the sewer usage. Overall impact to the average family, again, current water, the average family is paying about $15.16. Proposed would be $21.17. A difference of $6.01. ~ Here we are in the average family for sewer, we have $19.94, with a proposed increase of 52 dollars -- not increase, but, rather, proposed rate of $52.28.. So, the dollar difference in this case would be $32.34 or 162 percent increase. The average bills are down here. Total monthly bill would be $35.10 currently or increasing that to 473.44. For a total dollar difference of $38.34 or a percent increase of 109 across the board. We are not suggesting this rate. We will not suggest this rate. But I just wanted to show you what avery -- not very, but a conservative and highly anticipatory rate would do and what it covers. Here what you see is the same sort of -- same sort of tend where you still have to make the improvements to the plan in 2012, you do see an increase in -- in ending fund balances over time for the water utility and one thing you notice here is that the trend between the first part of the five year cycle and the last part of the five year cycle shows a significant recovery after the initial investment at the plant. So, you're able to recoup your dollars much more quickly over time. Now, these particular scenarios can be run any number of different ways. The model can be run a number of different ways. But what's important here is that we now have a vehicle by which we can look into the future, to the best of our ability, with the information that we have and try to see what we need to do today to help into the future. I wanted to give you some perspective as to where we are from a rate standpoint. We did some benchmarking for the water department -- well, for water rates and, essentially, what you see here is Meridian is on the very right here. Our base rate is about $4.04, with our usage charge -- these are current of $1.39. Twin Falls, moving to the left here, shows a base of $6..84, with no usage charge. That means once you pay your 6.84 you get unlimited water. The question mark here and all of these other marks up here refer to an anticipated rate increase for this year. Twin Meridian City Council Special Meeting /Workshop July 14', 2008 Page 51 of 61 most of our regional neighbors. Here, again, the water -- regional benchmark. Meridian is on the far right. As compared to the others. The wastewater, Meridian is -- other than Boise., is the lowest among all the municipalities. And., then, that transfers, of course, to overall average bills. Twin Falls being the exception here. Meridian is the second lowest. Now, they are somewhat close here. We have fairly close numbers. But between Meridian and Lewiston we are talking about a total dollar difference of ten dollars in rate. So, just various things to think about as we -- as we continue our discussion into the future.. So, in summary, our financial position has -- has many contributions or many things contributing to it. Again, energy .price volatility impacts our expenses. We have increased capital spending over a short period of time, which impacts our revenues, as well as our expenses. We have local, regional, national changes in the economy, which impact our revenues and expenses as have been described throughout the presentation. A reduction in rates, as well as a reduction in consumption have both contributed to changes in our fiscal position. We have increasing regulatory requirements, which will continue to impact our future expenses and as they have had impact on our historical expenses. And, then, of course, the rising cost of capital construction. But, in conclusion, I do want to say that we have a balanced budget. Even if we did nothing today, we made no change today, we have a balanced budget and we have a reserve if you use -- so if you so choose to use the ending ,fund balance as your reserve, we would have a reserve that's marginal, but would be acceptable, in my opinion. In our budget we have worked very very hard to reduce our personnel and our operating expenses utility wide by 12.7 percent, with the exception of wastewater. Again, if you add wastewater in, we have a net increase of only 0.3 percent. We have reduced our enhancement requests by 26 percent over last year and using the just in time capital financing strategy, we freed up 6.1 million dollars that we can utilize either for an operational reserve or however the Council so chooses. Through this exercise we have gained a better awareness 'and better reporting and tracking of our financials. We have worked and are transifioning toward a longer term planning horizon. We will continue to be fiscally conservative and we will try to strive to be more anticipatory with regard to our budgeting and our budgeting approach. We see this as an opportunity as a utility, as a fund, an Enterprise Fund, to make some mid course corrections and I assert that those corrections must be made today if they are to have the greatest impact moving forward. I# we do that, then, we believe that we can make better use and programming and leveraging of our existing dollars to meet our future needs. And with that I'm open to taking any questions or comments from Council. We also have ancillary staff here to help address any questions or comments as it relates to their functional area. Bird: Madam Mayor? De Weerd: Mr. Bird. Bird: Tom, I agree wholeheartedly with -- let's get -- let's get some fees added and started and it takes public hearings. I think you need to sit down with your liaison and figure out a deal. Anything that you can -- anything that you can prove cost-wise, I certainly will get on board and support. I`m a rate payer just like everybody -- like all of Meridian City Council Special Meeting /Workshop July 14, 2008 Page 53 of 61 set period of time and what time period that might be. Again, Tom said correctly that they can -- they can model, they can craft, they can put whatever assumptions we wish and whatever numbers we wish into the model and they can -- and they can back calculate what a rate might be, but they need some guidance, otherwise, we are just sitting there generating numbers and if we can tell them what number we are shopping for, they can do it quickly, as opposed to do it over a number of months. But I agree with Councilman Bird, it's something that poor direction was given six or seven years ago and we wouldn't be quite in this fix, but we would still be behind the curve in terms of inflation and needs. We have got -- we have got to do something about it. We cannot put ourselves in a situation where -- and I believe we are headed this direction, where we have to do debt financing to take care of some of the problems that we are going to have and that's not -- that's not something I'm even wanting to entertain. Bird: Madam Mayor? De Weerd: Mr. Bird. Bird: I agree with Councilman Rountree. We got to -- we got to give them some kind of direction, but this is one councilman that would sooner take the political hit with an increase. I will -- I shouldn't say never, but I don't think I would ever vote for any financial debt in this area. So, I think that we need to be practical about whatever we can back up we do. I don't like to see 109 percent increase right off the .bat either, I'm like -- but -- and I think another thing, Tom, that we have talked about every year -- every year that we are going to review fees every year and there is four people -- five people sitting up here that don't see that it's done and that's certainly not you guys' fault. And that's all fees. But we just need to make sure that the fees are looked at more and more often, so -- I don't know. Zaremba: Madam Mayor? Bird: We got somebody with their hand up back there. Zaremba: Just as a personal -- De Weerd: If you will wait. Zaremba: -- comment, when we do get to talking about having fees that cover the actual costs, I will put it that way, and including the future needs and the actual costs, my instinct is to say I would more heavily raise the user portion of the fee than the base portion of the fee and my instinct on that is -- I know I, myself, as a user like to think can have some effect on my bill by how frugal I am with my water use and the greater impact -- the greater control people think they have -- if we are going to send the meter readers out to read the meter anyhow and have a use charge, I would like to see the bulk of the recovery by being the usage chart and that gives people a sense of control. De Weerd: Well, to a degree.. Meridian City Council Special Meeting /Workshop July 44, 2008 Page 55 of 61 Canning: Oh. Bird: I just let that go in one ear and out the other, that part of it. Canning: I'm proud of it. Bird.: I don't blame you. De Weerd: Tom, I guess the bottom line question is as you prepared your budget, what was that budget -- based on what kind of rate? Status quo? Barry: Our budget was based on the status quo., yes, ma'am.. We -- much of the anticipatory things we have talked about were not included -- for a large part because we are not really ready for them. We don't know what we don't know yet and we really need to devote resources to figuring that out and, then, doing our gap analysis and., then, identifying the resources, both staffing and material and financial resources, to moving forward on those -- those various initiatives that the Council, with their guidance, would help us to identify as important for the community. So, one thing I was sensitive to doing is -- you know, being my first year here I don't know the Council promises. Mr. Rountree and I have talked and I am grateful for his guidance, but I did want to present a budget for fiscal year '09 that was reasonable and responsible and does kind buy us some time on a couple of different fronts and would not compromise our fiscal position beyond what it would otherwise be had we not begun to reposition our fiscal assets and strategies. So, Madam Mayor, I'm not sure if that answers your question, but that was the goal. De Weerd: Weil, I asked it knowing the answer. But I guess what -- too, we need to look at is a time frame and moving forward on your next step. Barry: Oh, I'm sorry, for the rate setting? De Weerd: Uh-huh. Barry: Yeah.. And recommendations. Absolutely. And time is of fhe essence there. We know enough now -- maybe I misunderstood your question. We know enough now to position -- to make the mid course correction. Do we know enough to know how significant those corrections need to be -- every day we know more, but we definitely know what we need to do. You know, that secondary scenario is one that gets you kind of close. It could be a little greater or a little less than that. We just -- we have to refine it a little bit more. But particularly as it relates to what you'd like us to work on and that goes back to our enhancements and fhat goes back to our base budget and those sorts of things.. Keep in mind, because -- I hope that you have gathered that there is an enormous amount work for us to do. We have been a department that has been -- I have got to tell you a new director -- one of the biggest things you worry about coming on board is the staff you inherit and are they competent, are they capable, are they Meridian City Council Special Meeting /Workshop July 14, 2008 Page 57 of 61 De Weerd: Mr. Zaremba. Zaremba: I guess I would comment on using loans or borrowing to factor into this system. I, like several of the other Councilmen, I am generally adverse to that. I would prefer ghat we do a .pay as you go system. But I would add that there are circumstances where I would consider it. The big example is the GARVEE funding for statewide transportation, where for .huge capital projects it's cheaper to build them with today's dollars and pay them back over time. I certainly would not use that for small things or things that have just showed up, but while I would be very slow to approve it, I could see that there could be a place in the .mix for the big major projects. Personal opinion. Rountree: Madam Mayor, I don't disagree. with that, but right now we see the train just starting to come out of the train yard at a fairly slow speed and if we can anticipate some of the things that's going to bring to us, let's do it within our budget. If EPA decides to run over us with. a major regulatory compliance issue with the wastewater treatment facility, we may very well have to seek some kind debt financing to accommodate that. But if we can anticipate some of this stuff, that would be my preference. I think. at this point we need to give some guidance to the Enterprise Fund and Public Works as far as some of the enhancements they have talked about and from what I have heard and those that seem to have some flexibility, I would suggest that the Well 23 enhancement be dialed back to the cost of the study and the funding of whatever might need to be done advanced for next fiscal year, that we do enhancement number five in wastewater and delete number three and direct those budgeted amounts to the new enhancement number 11, because I think fihat's going to pay us some big benefits in the future. De Weerd: Okay. Council, are there comments? Rountree: .Those are my three or four suggestions from what I have seen. Barry: Madam Mayor? De Weerd: Yes. Barry: Mr. Rountree, I was wondering if I could get a bit of clarification on your comment relating to Well 23. Mr. Borton had made the suggestion of you that monies for Well 23 should be restricted to the studying of aquifer recharge or aquifer recharge storage and the difference would be reverted to miscellaneous water. system improvements. Is that still your is -- is that your recommendation here or are we talking about -- Rountree.: My recommendation would be to cut -- cut whatever the difference is and either move that to a reserve account or an unrestricted enhancement account. Barry: Okay. Meridian City Council Special Meeting /Workshop July 14, 2008 Page 59 of 61 Rountree: Yeah. De Weerd: Okay. Were there any other questions or discussion points on any of these other enhancements? Rountree: Not that I recall. De Weerd: No? Rountree:. Good to go. Borton: Madam Mayor? De Weerd: Yes. Borton: Tom, can you a-mail us a copy of your Powerpoint or print it or either? Barry: Yes, sir. I think a-mail would be problematic. It's about I think 17 megs. We can do -- we can print it and put it in your Council boxes if you like. Borton: Okay. Rountree: Madam Mayor? De Weerd: Yes, Mr. Rountree. Rountree: If there aren't any further comments on the enhancements, I just wanted to thank Tom and all the Public Work folks for the good job you did and I'm not going to use the word visionary -- but the thought that you put into our future as a committee and as well your future in your working environment and the same goes to the rest of the staff, particularly finance., for helping the generation of a model that I think will be very beneficial for us. With that, Tara, if you would make a note that I would like to -- I know about one item for the August workshop and I would like to hold the August workshop to have that one item and I think that's a discussion from our friends at Meridian Heights and a discussion with Tom and staff about the model and, then, start giving some guidance from Council to them in terms of what it is -- or where our political will is going to be as far as rate increases, so we can get something going possibly in September or definitely in October. De Weerd.: Well -- and once you receive a copy of the Powerpoint, if you have any other thoughts or suggestions, , I'm sure Public Works would appreciate them in advance, so that they can lend something additional or change as desired. So, any comments -- and Tom and other staff leaders, I, too, appreciate how you have rallied together behind this. This is -- you know, I guess I did hear the comment, you know, why didn't we increase this over time.. We have had increases. The modeling or the Meridian City Council Special Meeting /Workshop July 14, 2008 Page 61 of 61 decided. We will go ahead and a-mail to that you, too, for the Enterprise Fund, so you can see what it looks like. Rountree: I would suggest probably October after we get through budgeting process and it's still fresh, give these guys a little bit of a break. Kilchenmann: Yeah.. Just a little break before we start year end. Rountree: Yeah.. Kilchenmann: But, yeah, we -- I think there does to -- we have gotten so much bigger and so much more complex, I think there does need to be time for you to get the data, go digest it, and., then, give staff time .to answer questions, so like Steve, they are not running around franticly and, you know, trying to come up with answers and so forth. And, then, I think there is some suggestions from the back of the room,. too. They are both nodding at me, so -- De Weerd: Okay. Very good.. Well, thank you all. And I would entertain motion to adjourn. Rountree: So moved.. Boston: Second.. Bird: Second. De Weerd: All those in favor say.aye. All ayes. Kind of. MOTION CARRIED: ALL AYES. MEETING ADJOURNED AT 4:00 P.M. (AUDIO ORDING ON FILE OF THESE PROCEEDINGS) .~ (J d MAYOR.TAMMY De WEERD DATE APPROVE ~~~~„ri u u ~ ~,,,,~~ ,~~~~ ~y ~ ERIp~'''•,,~~% r ~'L -, . ATTEST: ° JAYCE . 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W ~ ~ o~ o n . o ~ Q o ~ v a ~ ,~ ~ _ ~ ~ = n ° ~ ~ ~ n `G ~ O ~ = _ ~ - ~ ~ ~ ~ ~ -~ O -~ ~Isl O ~ ~ y Efl U1 U1 X71 ~ O ~ W O W O O O ~ O O O ~1 A O ~ j ~~ ., ~. O ~ E_fl ~ ~ ~ n n W ~I W OOp U1 S ~ O O S 0 0 0 0 0 0 ~ o° ~ °o °o o° ~ a ~D ~D ~ ~ ~ y a° a, O O ~ ~ 1'1 N O m a m .~ m ~ ~ OD o, z ~~ ~3 a~ rn ~ O v ~ ~ ~ v ~ ~ c~ ~ ~~ W ~ O O Oo N ~ ~~ ~~ ~~ oo°Oo 00 0~ ~ ~ O O n n ~~ zz X ~ (gyp ~ ~ ~ ~ ~a~ N N U1 N Efl p~ O O O O ~ ~ N ~ O V ~ tN0 ~ 01 Eiri ~G Cif C7 O W CO m c° ~ Q O _ (~D ~~ ~Q ~~ ~, v ~_ m ~' `G 0 v ~~ ~Ig ~~ W 00 U1 O O W N ~ ~ N~ ~ ~ ~ ~ V ~ ~ ~ N O W ~1 v m c~ w O OO 4 ~ Q N C t?1 ~ n O v N ~ ; W ~ ((Q~~ ;,. C71 O O 01 v ~, 0~ n ~_ n 0 • I ~ ~_ C7 ~ ~ ~ W ~. ~ ~ ~ ~ ~ ~ ~ 0 o c~ ~ ~ ~ ~ < c~ ~ ~ ~ ~ ~ ~ iv CD CD O ~ CQ ~ C~ ~ ~ Cep ~. ~ X CD ~ ~ C7 N ~ ~ ~ ~ ~ D C7 C7 ~_ ~ O ~ ~ C7 ~ ~ ~ ~ ~' ~ Q ~ < ~ ~ ~. ~ n ~ Q O _ ~ ~ ~ ~ c~D O `~ ~~ ~~~ ~~~ ~~~~ • O ~ ~ ~ ~ 0 C ~ 11 ~, O y ~ ~ ~~ ~D y CD C CD 0 CD CD _~ n~ CD D ~n° 1 ~ a Efi Efl ~A C~1 O tJ1 O Cn O O O O O O O O O O O O O O O ® ER O O O O O O O O O O T \` ~ ~ ~ ' I ~ O ~ ~D W ~ ~ I ~ ~ O ~ ~, ~P ~ ~ TI r~{ : i ~ rn ~~~ ~ o ~~ ~ ~ ~ ~ ~ ~ ~ ~d' ~ O ~ P ~ 'i~ = A ~F ~ ~ ~ ~ _ v ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ a. ~ a c~ ~ ~ = c~ „ ~ ~1 ~' ~ ~=-f ~ ~ ~ ~ ~ ~. ~ ~ ~ ~ n ~ ~. ~~ ~ rn ~~ rn ~ ~~ rn~ ^ 1 V T rn~ ~' V O m~ V n, ~++ ~ n c~ ~ ~ ~ ~~ ~ .~~c~.~~~~ JUL' 4 ~ 200 City of Meridian City Clerk o~Ce Fiscal irresponsibility within governments and corporations has focused public and media attention on the propriety of accounting rules, regulations, and financial reporting practice and on the ethics of financial officers and organization management. Resulting changes in generally accepting auditing standards, generally accepting accounting principals, and government accounting standards board pronouncements have made compilation of year-end financial reporting and audit complex, highly technical, and time-consuming. The Finance staff is ultimately responsible for ALL financial actions taken by the City and must communicate acceptable .practices to City staff while striving to maintain the highest level of transparency and accountability for City stakeholders. r External changes in technology and regulations and growth in the intricacy and size of City operations continues to increase the volume and complexity of transactions that flow though the Finance Department. Thos requires our relatively small staff to have professional skill sets and the ability to improve operating efficiencies as well as plan for expansion in customer service. (Credit card processing, fee modeling, GASB reporting, long range pro forma statements) ~~: i C~~0 • G The current economic climate does not decrease our workload. G The need for long term planning, carefully formulated fee models, and fast accurate financial information sent to managers and elected officials for decision making has increased. G While the number of title changes in Utility Billing has dropped off the number of turn-offs (300 + per month), bankruptcies, foreclosures., and rental arrangements has increased. G Five year pro forma and fund balance analysis for each of the City's funds. Best practices documentation for the budget process with an emphasis on controlled base growth, long range planning (decrease amendments)., funding for capital projects, and matching of revenues and expenses. 2 t • • r Performance Budgeting and benchmarking - standard format already recommended by GASB - could become a requirement. a Formal Council adoption of Capital Improvement Five year budget. -Comprehensive update of General Fund and Enterprise Fund projects. c Categorization of expense line items r Variable - i.e. energy costs ~ Standard - i.e. employee. incentive Fixed -cannot overspend - i.e. dues and licenses c Zero Base -Justify each year -electronics c Fee based programs -street lights? ~ - .. - c~ X00 .. - ~ - . . ~jp ~0 . .. - e . • Operations • ABRA • Accounts Payable . Paperless software and technology • MI'P -Fund Accounting . Module upgrades • Policy and Procedures . IRS, GASB, State of Idaho and city citizens • MUBS . ACM Electronic Check processing 3 i f . [app Q~0 - .. - ~ . . • Budget • Software . Web-based tool to consolidate budget data • Audit • Controls and Procedures . Contract with third party consultants to assist in complicated tax and financial laws. • Purchasing • Software Purchase c~ 100 - • • New for FY2009 Other Government in all three funds • Most new City Hall expenditures are now budgeted under Other Government for the General, Enterprise and Development Services Funds. • Many departments have seen an overall decrease to their individual budget that can be associated with the reclassification of expenses to Other Government. • Consolidating specific City Hall expenses will make it easier for overall analysis to the cost of the new building and will reduce time spent on account coding for each department and finance. • Examples of what is now in Other government: • Electricity, Gas., Telephone, Postage, Coffee, Soda, Janitorial, Building .Maintenance and other items related to supporting the new City Hall. • An analysis was conducted to determine how much square feet each department occupied. This analysis created a percentage that will be used on allocating shared expenditures associated with occupying the new City Hall. • Web-Based tool to track, report, analyze, communicate and organize all City projects. 4 Meridian Parks & Recreation Budget Presentation Fiscal Year 2009 Department Mission *To enhance the community's quality of life by providing well-designed and properly maintained parks and recreational opportunities for all citizens. - _ m ~ r•= ~ l ~~' ~ ~ r.j t F-'~ 2048 AIC Awards *Meridian Pathways Master Plan `~ r' *Movie Night in Meridian ~"° ° ~~~'~ -~ *MYB Complex `~'"5'>= y ~ .i~~ ~ ,ii -_~ ~~ ' ~~ , :' ~ -~ ~ ' ~ -: l ~ ~ ~,,- ~_ ~ .~~c~ ~~~ IV~.~ ~nymf, ®?408 ~~1~~~ Benefits of Parks & Recreation 'k Economic Benefits *Health Benefits *Family-oriented Entertainment ~ "& _~ ~' E :'. ~ r - _ i :~~ ! ._.. ........__._. ~ '._.~r .. ...~ Meridian's Parks ~ ;~ ~ {, Cin of ~lcnJian ,T V} Park _ ~I ~ '`i j ~ - d- ~ i~- _ r u- ~ i;' ~ 11. `~ ~t7 Meridian Settlers Park Current Amenkies • Atlventure ISWntl • WaterSpWSh Pad ~L„_-~ - - 8 BaIPFlelds ~_ j 5 Soccer Fells a • Fishing Pond ~ ~e~t ~ '~~ ~ Walking PaNs s x ' Shelter , - ~ '~ { Future Amenkies ' _ ~ 1 - Horseshoe Courts 1 -., J.; 7Tenn6 Courts _ • CommunityPlaza 2 I 1 c Meridian Settlers Park Concessions picnic shelter Stand & Restrooms _ .._._... ~ Adventure ~` -,~-~ ~ 2sland ~:~ Playground ~~ c>_ _....~".'~ Meridian Youth lex Baseball Com ~~ ~ ~ . ~~~u~'~ ' Splash Pad p ` ~' ~ ~ G Meridian Community Parks Tully Park Bear Creek Park ~...~ a. ,~,~ ~ ~ M ~~" v. ~J Storey Park Heroes Park ~.~.._~ i ~ ~~ }~ Meridian Neighborhood Parks Renaissance Park Seasons Park 8'" street Park k`'I i ` .w Champion Park Chateau Park Kiwanis Park r,~~ ~ d - ~` ~,~at ~~ } ~ t ~.,~._~ • 3 Poeket Parks City Mall Park Generations Plaza ,~} ~, t 3'~ - ~~_ ,~ r i ~ ~~ ~ ~`~~ ~' 1 C Cent nnial Park Flre Station #4 y 4_~ ~ ~ - Y ~y - /' - -sn 1 ~~~•.._....M.. _... _.~ Activity Guide 3 Guides Released Every Year Spring/Summer Guide FalfGuide Winter Guide Released in April Released in Augus[ Released in December J k ~:~t l i~LL? ~ ~ iSrClY5h0Ei , ~~y t ~ I 1 y 7"R 1,~ !i ~ ~ 13A11 t~" i `~ ~ S ~ ~ Summer Camps r---z ,~ a ,~ ~ - - F ~ ,: ,i--ti---, ~ ~ 1, l ` _.~_ j 6 '~ ' rf ~ ~.+ ~~wd i R~ ~' ~'r~".~n 's-~"~ ... , Sports Camp :~+~ ! ~`~` CampMer-Ida-Moo ~'` ~ f ..i .t,j: Jump Rope Camp ', y ~' Outdoor Adventure Camp ~yi~ ~ 5.~.{ Art Camp 4 Sports Leagues Volleyball Basketball Co-Ed, Men's & Women's Men's & Women's .~G... , ~ ~ r ' ~" - 1 4, ~ '~ I ~ Girl s Fast itch c i ~ ~1 .. ,. ( - --- H ,`----~ Softball '. ~ ^ -{~' ~ '~ ~` „ ~ ~~ a '~ ~ ..~ softban _ ~ ~~ ~ ~ CaEd & Men's 3 ~ 1 4i '~' .(~ ~ .. ~,, ,,.. v ~ E ,..__._. ._. __.. ..'.' Z Movie Night. in Meridian Every Friday during June, July, and August, ~~U.~lf:5o"dE11C Meridian Parks and Recreation sets up ,R their HUGE inFlatable movie screen at ti~, Settlers Park and invites the public to come enjoy afamily-friendty movie for FREE! -:1 in Mwiclian ~., ~ ~ ~~ - f _ f~-~~C 5 Movie Night. in. Meridian Christmas Tree Fighting ~lR `~ _ ~.. S~_....... ~ Y ~', ~~ n0 ~ ~~ 3 `[ -, ~ 2 Friday After y ~. ,A : ` ~- ~ „ ~ Thanksgiving ~, o More. Community Events & Activities * Barn Sour Race ~~~ ` ~ ~~` * ] OK and 6K Races ~ ~^~' ~'~ •~ ~~. ~r * 1 Mile Fun Run '"~'" ~ ;`~- ~: ~ ~ ,'.7, ~< *Teen Activities Club *Meridian Middle School / --~ *After School ~~~~~' ~ ~~ ~~ v ~i ~ -`'~ I ~ ~' Program ~~`Y~ ~,4 ._ ~ '. 6 !' • Parks Statisl~ics * 203 acres maintained * 139 acres Regional & Community Parks * 43 acres Neiehborhood Parks * I acre Pocket Parks * 7 acres Pathways * 13 acres Other Landscapin_ * 423 shelter resenrations so far this year *~L5.000 Revenue * Current Park LOS *2.5 Acres per 1;000 , * Last Year 22 Acres per 1;000 Sports League Tlrends MPR Sports Leagues '2~s5 soon '' 2tOr ~r.mrv 2500 ~_ _ 2000 ~ ISif wr. mrv mm m 1500 m~~.mrvmm 1000 ~ r~+ - ~ravayr ~ d II 21105.2006 20062007 2007-2008 BuEgal Year Activity Guide Participation Activity Guide Enrollments 2500 ~o '2t89+ 2000 ,136 Total 1500 ~ i Enrollments 1000 ~~ 500 ~ 0 ~x 2006 2007 2008 Year 7 1, Parks & Recreaticm Staff * Parks Staff * 9.i fear-round * R Seasonal Maintenance * -0 Splash Pad Auendmns * Recreation Staff * 4 fear-round * I S Seasonal Day Camp Staff * 10 Scorekeepers * Administrative Staff * I Admin Secremry * I Director * Total * 5G Taal Employees during Peak Season * 16S fear-round * Does not include 17 Independent Comractors FY08 Project Highlights Sutlers Parts Splash Pad -New additlons aM up9rade5. to rhe5plash Patl at Settlers Park will make the fea W re even more ftm and Safe. „y - .M ..~ 4` Adventure Island Playground-The 9M andfinal Z r j `~' phase of mis amazirgdaygrataM InSetders Park inUtdes }, ~ r , Me Dttle CiN of Rocks and a Music Garden. .. ~ .4 -~ ~% •. ~i: ~d Settl rs Village square-CG6tilKti0n documerrcs ere - - t I ',(f ,P p [edthis spnrg for tcma courts, horseshoe Pts, ~ j - aM apimic shelter. Greenup of the comer is competed ~ ,\r tt~~ M roes Park - taMSrapinq aM paving aramO the t U_ .~ . existing cerkirg la area iz complete. ~ • ~/ ~ ~ Fg~ @. + x .1 Btfi street Park Pedestrian erossin -This new~pedesMan owning w.., must the SMile Geek connecting 6th Street Park with,lhe Bud Porter Padnvay. MMS Ballfidds - We htld a granW opening a the new SOftballfields a[ Heritage Middle School. Renaissance Park - the newest NeighbNhootlPark had a grand'ocening and was named thragh aneighbarrwod comcetltion. Future Parks ]alias M. Kleiner Memorial Park - on the corner of Fairviewantl Fa le [his will be ~~~•,,-, %`~-~'.c y~~P~ . -~ ~Y g ; a 60.acre park built in association with [he . ?,.` ~ I ~ ..~.r s Meridian Town Cen[er project. William Watson Dark- bra[ed in[he ~, ' ~~ ~`.~ ~~ ry/..,KS_ ~ T7~ Bainbridge subdiv'tsionoff TeAMile~ROad between MCMiIWn andChinden; [his wilfbe ~r~ q~ A`, ~,.. ~ -i ~~r w a 7 8acreneighborhood park. ~ ~_ J Unnamed Park (Boron Drocertva-The ~~ - city currentryowns a 30-acre piece of land ' on Cherry~Wne just east of McDermott. - - , Some Conceptuabplan5 have been completed bu[ a finalsi[e pWn has not'been _ .-. ~ a ~ , determined. The City will wait until water ~ - ~ „Y r antl~5ewer accessare available to start any construction on this future park. • 8 // Parks & Recreation Fees * Impact Fees Increased Febntar`y 1, 2008 * Residential: $1.334 * Commercial: SO ; * Recreation Fees Reviewed Annually * New Pees Adopted May 20; 200.0 * Will analyze Nonresident fee structure this Fall * CPP needs updating * Current costs & projects *Needed for accurate Impact Fee Cost Savin;~s * Shelters * Basic 20x20 Shelter Delivered: 510.0011 • Terry Whipple In-house Fabrication: $4.500 * Tree Well Frames '` * City Hall IS Frames + If ordered. $6225. Our costs, $?250 _ __. ~ ,r~~ * Volunteer Efforts i ~~~ , * Eagle Projects. Bud Porter Cleanup, etc! * Ada County Juvenile Service Hours * Partnerships/Donations * Meridian youth Baseball $1.4 M * Tuscany Development $1.4 M • Police Activities League $325K+ Enhancements * I. Heroes Park Improvements * 2. Settlers Village Square Phase I * 3. Meridian Community Center * 4.4x4 Truck and Snowplow * 5. Meridian Middle School Improvements * 6. Christmas Decorations & Banners * 7. Heritage Middle School Ballfield Fencing * 8. Turf Equipment * 9. Adult Sports Expansion * I0. Shop Renovation * I I .Tree Inventory Software * 12. Storey Park Restroom Locks * 13. New Computer 9 ~, Heroes Park Im~~rovements - - T' B ', ~ ~ I tL 1 ( t ~ P ~~~ - ~ ~ ..: ~"~ ~ ~ ~ ~ ~ a - - e ~a I 7 1 i ~ - .. __ (J ` _ ~ ~ ~ ~~ i . 1. Heroes Park Improvements * $940.750 * Restroom/Maintenance/Concessions Building * Playground, Swings, Benches; Softf~ll * 2 Shelters * Trash Cans. Ten Mile Frontage * Pathway and Trees * Plans, Permits, and Signage * I Seasonal Employee * Enhances Amenity Value to Surrounding Community 2. Settlers Village Square Phase ,...., i J ~ i r ~ '~a1 Ra ~ x =+~ *~ .'~~"~ " ~ y a ~ ~ . 'd. J..r.# ( a ~. '. t y ~ ~ ~s _ y , i ~ ~e ~ ~{ 3 ~3 ~~r s!~i LF~~ ~a ~~`~ ' ~ ~ r ~.:p 10 I /, • Settlers Village Square Phase 1 * Construction Documents Completed this Spring. * Phasing Plan Presented in May ~ rt f s~~~ ~ z 4 ~~ ~ y. ~? ~" ., ~ ., \ , s Sett ers Village Squ~l.re Phase 1 *$150,000 of $603,000 need~,d to build first phase *2 Tennis Courts, Horseshoe Pits, new Shelter *Utilities, lighting, irrigation *This year vs. next year construction start 3. Community Center ]Furnishings F ~, „~ ., I * $26,350 'Council motion approved in _ ~~~ ''''~ . ~, June for Parks & Rec to receive old Boys & Girls Club/Police Building *Needs basic furnishings to hold recreation classes & camps *Tables, chairs, room dividers; maintenance * Partnership with Police/Fires Departments 11 1' 4, 4x4 Truck & Snowplow *Truck needed year-round *Existing fleet light-duty * Only one 4x4 truck *Snowplow needed in winter *Existing one used from early morning until after-hours *No back-up *Needed to get to all City perking lots, parks, and pathways in a timely manner 5. Meridian, Middlle School. * 54,000 *Contribution for improvements at school *Partnershipwith MMS * Recreation Classes, Summer Camps, Sports Leagues, and After School Program. * In the spirit of partnership, we would like to contribute toward the upkeep of their facility, as we contribute to: the wear and tear. 6. Christmas Decorations & Banners * Original: $83;500 ($37,500 City) * REVISED: $42,900 ($20,600 City) * Christmas Lights at new City Hall .~ ,~ "'S @ *On Building and Trees # * New I6-foot tree for City Hall Foyer * Snowflake lights for Main Street ~ ~~ t~ Light Poles tit ~ ~,; +; * Year-round banners and lights ~ . . _ ~.. * MDC Partnership for Funding 12 1' 7. Heritage. Middle; School Ball Field Fencing. * 539,500 * Raise existing sideline fencing from 4-feet to 8 feet *Add outfield fencing ' *School District willing to fund 520,000 *Needed for safety * Propose increasing our tearn fees to help recoup our costs 8. Turf Equiprr~ent 'Turf Slicer ' * Part of Turf Management Program ,t Similar to Aerator, but no messy plugs *Helps with soil compaction from heavy use ~kAvoids more costly renovation 9. Adult Sports Expansion * $5,000 * Sports program continues to increase in popularity and # of sports offered ~kEnhancement will be offset by Revenues • 13 1, 10. Bower Street Shod Renovation * 59,250 * Minimal improvements to ~, ~ hold us over until we get a neq~ ~ shop/location ~ ~ I * Two offces will be unused wlie n we move into City Hall ~ hw.,.,-°° * Convert area in needed shop - - "- -" space ~ ~' ®i YaA .. ii 1, _,. _.., * Roll-up Door i * Remove interior walls ll. Tree Inventory Software * Over 1000 Trees in existing park ~'~y system ~ ~-~` ~~._._H * Hundreds more anticipated in next several years * Long-range management plan needed, monitoring of "urban forest" health, replact;ment, pest control programs * Citrix License, GPS, ArcGIS, T'reeWorks Professional Program 12. Storey Park Restroom *$1 1,200 *Only restroom without autotnatic door locking systern *Susceptible to vandalism 'System requires new doors, jams, power supply, time clock, and associated wiring ~~~ `.~ 1 -~.. • 14 OJ 13. New Computer *51,650 *Need 2"d Workstation at front counter in new City Hall *Shelter reservations; course. reservations, sports reservations from public *Computer, software, and monitor Questions/Discussion 7~i~1 VK y~Gh •Working the f lan Piene Sheltf;rs Shelters are available to rent ~- T at the following parks: Settlers Park -r",.-.'~,.=--;°` r ~~~ ~ • Storey Park ; ~ ,~, ~ • Tully Park r_ • Bear Creek Park • Chateau Park ~,+j r_=~__...~~„ • Champion Park ;~_ ° ti~"~'~ ; " • Seasons Park ~ ~- t ~ ! ~ • Renaissance Park ~` ` U 15 o " o° ~ o rn v ~ ~ ~ ~ F_I rrW, rrid, F~+°I w d ~ ° 0 0 0 0 0 0 0 0 0 0 0 0 0 0 o O O ~~ O N ~ O M O O 0 t0 ~ ~ ~ ~ ~ 0 gyp N 'O. 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N L . -a o °~ O ~ ~ C w ~ O ~ ~ ~~ L rn ~ O Y ~ f0 O ~ UC7 f0 N = M ~, °c' U j O O w ~ rn~ L ~ D7 Y ~ ~ C in c p c '~' 3 CO ~ 3 c w 0 ~M.c O N y ~ ~ f0 ~ O ~ p c y ~ ~ N O N rn w d C L ~ ~ •~ ~ ~' o ~ o ~ ~ C ~ ~ w ~ ~ UQ _p O ~ o a m o0 0 M ~ ~~ ~ - rn -o ~O• ~ L L 7 ~ a •~ N C N ~ ~ w ~ c p C L ~ f0 N L w N f6 ~ ~ ~ >p ~ ~ ~ > p >' w ~ °o .° - LL ~ C .~ m pa c c n O M U ~ o m 3 a N w C w O c O N U c N 7 a d U c U a> N N m t ~3 N N O a .c C 3 0 c O C 7 c :~ •3 vi ~ O c °a C L m a L ._ O ~ O 30 o w ~ ~ y o ~w Trn ~_ m O L _ ~3 N w c ~ ;O f6 ~ O m ~ O ~ U y ~ f6 m a o O C c N O .3 z f0 2 ~ .~' L U °~ O N r C N ~ w .c a ~ ~ N C ~ w ~ o •° c •~ c y c d ~ 7 L ao N w o N 0 N O 0 N r HUMAN RESOURCES CITY ATTORNEY INFORMATION TECHNOLOGY 1 Fiscal year 2009 * Budget Presentation _ ~ duly 9, 2008 I• ~ ~3; i ,~~ BILL NARY ii Ciry Attorney/HR Direttor TERRY PATERNOSTER * ITManager ~j~E$IDI, 'Salary Market Adjusunent for FY 09: 3% Merit Pool proposed for FY 09: 4% ~ FTIPT Employees: 287 ('6 of employees to population is lower than all comparable Cities) (+46 seasonal, 2 interns) • Applications in 2007: 1132 * Employees hired/terminated in 2007: * New Hires: 41 * Promotions: 42 * Terminatims: 37 * Seasonal Hires: 34 ~jV(. EIZ,IDIAI` ' 'Blue Cross. PPO Tentative Total Increase `Delta Dental I I.O2%* (wilt be marketing '81Ue Cross - V$P ~ this plan for renewal) `Flexible Spending and Benny Cards (138 Employees now!). i~`United Heritage Life Insurance $SOK per/employee STD/LTD ~~ jEAP *iF.E.R.S.I. 9 ~j~EI2\IDIA ~~ ~~~~ ~uL ~ ~`~ ®1008 ~~~~~ 1 ~~ ~ilness Committee ~` ~ ~~ ... *Alternative Transportation Survey ~ - -~, , *Employee Work Out Room ~`iV(EI~IDIAr ty Policy Revisions ~b~ Lo ~~ ~ 1~ ~ '~ *Travef * Drug Free Work Place ~l t Accomplishments cont. _ ! ~.^_ ~_ Multl-Departmental Code ..Enforcement Team ~ o a SALE R~ ~ .~ *'Police * City Attorney FOR + Planning SALE * Building ~jQ~E IDIAN*--- OP~~L 2 C~ ' ' Accomplishments cont. 'Enhanced IT Services to City Staff ~ Help Desk Software and Staff * Improved PB,Z Application Process * ABRA Software * Intranet Lookup * Email Management ~ *Automated Timesheets * VPN -~`~ * Graphic Design Intern Cj~E IDIZ IANs_- ~~~,,/ Achievement Award for Internship ram with MTC1-1S ~ ,. ,~ I: ~j~/~E IDIZ IAN*- oavo MEET FUTURE NEEDS Needs: ' 1~E IDIAN •~ City Hall Workspace • Department Alignment ~r'op, uz,ooo IDAHO +~Evolving Workforce A *PublicConnectiviry ~ :. * Expectations of Others ~ *Technology Improvements * Consistency of Applications 1 *Fuel Savings Policy *Alternative Transportation Issues Lj~E IDIAN*- ,ner.. • 3 • Hui man Resources & City Attorney Staff p ~~ '~ ,a ; t (~ ', ~~ • Bill Nary, City AttomgMR Direcror * Ted'.Bavd. Deputy Attorticy Nancy Powvs. HR Andya FmiyKane. Deputy Attorney Audi Omton. Benefn SpecaGrt + Michelle Abertson, Leg I Support Harilyn.Ri~e, O~ Aavsant Smices Admiristntor ~j~E IDIAN~- City Attorney Enhancement f t Receptionist ~ _ P '.' $51,227 "~ ~ - `r ' ~\ ~~ (City Hall Workspace * £ustomer Service and Resporee . t ~ -~'~ * Accountability to the Public ^~ *IEfficient Use of Legal Resources Lj~E IDIAN!- CAHn - ~ H R Analyst $87,736 ~} i Re-Alignment * Internal Training *~ Provide for succession planning * ` HR Outreach and contact point \ *~ nvestigative Expertise ~j~E IDIAN*-- OAHO 4 HUMAN RESOURCES ENHANCEMENT #2 y l~ Professional Services $72,000 - ~ i ~; . ~ ~ Expand Training ~~~~~ ' °'- Provide Continuous Improvement for Leadership *~Maintain Momentum * Improve Compliance (~j~E IDIAN~-- ~o ?~~r ,,;'~''~~1~,., I ~ ~ . r + ~ aay Pacenrosrer, IT Manger + David Ticdc; Server Adminisuawr ke Tanner, Sr. Daobase.Devdaper + eith Danklsen,.1T NesworkSpttialin • 8rad.lbyd. IT Sipporr Tech + ;Nie sl,annon. lr Inrem S ~E IDIAN3-- #~ Fiber Build Out $44,000 Connect City Hall, Water Tower, Pblice and Fire Stations I and 4 with fiber Increased connectivity, speed and reliability Advancing technology Install jointly with ACWD =cost effective ~j~E IDI • 5 • __ 'INFORMATION TECHNOLOGY ~.`~ ENHANCEMENT #2 ~~ '. Training. Lab _ !~ $22.000 ~,` ~., l~ ~_:. 4~.. Internal Training opportunity ~ ~`i e Cost savings for on site training .i ~Y ~ Improved customer service ° , ~= ~, Lj~E IDIAN*- 'INFORMATION TECHNOLOGY ENHANCEMENT #'3 ' WEB Content Engineer $83,840 Iriiprove City Website ~~+~"~ w' Enhance Functionality for the Public -- , =~ Focus attention on technological need NFORMATION TECHNOLOGY ~. ENHANCEMENT #4 Consistent Application of Software City-Wide 'Enhanced functionality within the City Mic+msoft' ~j~E IDIAN!~- 'Microsoft Office Upgrade $75,000 '~ 6 ~y ENHANCEMENT #5 Back Up Software ~, $37,500 Better efficiency in saving data _ „ _ ~~Limit risk of data loss L/V! t _ 'INFORMATION TECHNOLOGY ~ ENHANCEMENT.#6 ' -' ` t' WEB Consulting •• i $33,500 `';.,./ *' * Improve WEB Design I ~J1 ' ; ,- ~ Create better access and use ~ ~~ = * ~ ost savings ~jQi~E IDIAN~- 'INFORMATION TECHNOLOGY ,~ ENHANCEMENT #7 _~'' Enterprise Software $847,452 .r-- r~ .i l r ,oM_ 2 °ooJ ~. ~j~E IDIAN*-- i 7 • _INFORMATION TECHNOLOGY .; ~ ENHANCEMENT #7 cont. enhancement based upon recommendation of City Wide ethnology Committee and Public Works Director Improve quality and functionality of City's most crucial systems " f Improve Operations of Permitting (Building, Electrical, Liquor, l endor, Dog Licensing, etc.), Code Enforcement, Fire, Manning, GIS, & Document Managementllmaging 4 Phased process is the long term solution that has been sought tfor many years • ecessity to hire programmer to implement and maintain cj~E IDIAN~- - Custodial :icy Half and City Buildings * Tentative Custodial Contract (WBM) - $236,.139 C~1` ~ ~ 1 'k Propdsed Custodial Staff * 3 FIT Custodians for ='"~` ,~-~ all City Buildings except Fire Stations~,$202;1291~<„~ $188, 579 i~.8«~ c~/rE IDIAN';- o.,„„ _ ~_ Thanks! t Know the budget process feels a lot like this F ~ _~ y ~ `w 9 .; .~ cVI E IDIAN*--- ; $ a N O O z d d ~ E o ~ o rs w :n V+• ~' ~ ~ n ~~~ n~ a ~~ rnrn 3p ~~ z~ ~_ rnrn 3 ,n Z~ ~~ r1/ Vf p rn~ 3rn ~~n ~~ ~~ s$~~ •. ~~ ~~ o ~ ~~ a 0 °+Aa a~z rt ~ c°i3 ~ ~ ~~ya, ~ ~ ,. ~~ _~ ~ ' ,' d H 01 _ ~ 1 j I ~ 3 E o G ~ N ~ 3 a O `C ~ d ~'~' O N o ui o .n .~. 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Cost for Services ~'le~.~~ The Boise City Attorney's office proposes to continue to offer Meridian City a flat annual fee to be billed in monthly installments to provide the services described in this proposal. Primar~Legal Services Primary prosecutorial legal services include: • Prosecutorial intake screening and review of all police-generated misdemeanor reports and citations; • Timely filing decision and notification back to MPD and customer; • Prosecution of infractions and misdemeanors occurring within the Meridian City limits or pursuant to the Memorandum of Understanding between MPD and BPD; • Coverage of the additional caseloads in the new criminal courtrooms assigned by the Trial Court Administrator. Primary civil legal advice and guidance to the Meridian Police Chief and MPD include: • Access to members of the Public Safety Division for immediate assistance 24 hours a day, 7 days a week through cell phone and/or pager under MPD's protocol; • On-site legal services by the dedicated assigned Police liaison attorney two half-days each week; • Routine review and approval of the MPD's public records requests and property dispositions; • Superior legal training for Block Training and Advanced Academy on search and seizure, trial preparation, investigations, and domestic violence; • Training on other needs (including those identified through the screening process) by request of the Meridian Police Chief; • Regular legal bulletins, including Idaho case law, U.S. Supreme Court, and the Ninth Circuit. Annual Cost - $255,744 Monthly Installment - $21,312 ~' %Y09 Police Budget _~. ~ ii. Financial Stewardship ,~. ~ , ~. ~a._ ~ ~ ~; .eee~ ~~~. WD ne.a ~e me m.eme ~a~.eaoeee e~ 2 Meridian Police Department !~j~,;a, ,. ~t*r,rj E~\ C' /~. 1'- Chief Jeff A. Lavey 3 RECE~~E~ JUL 101008 ~ity~fMerid' `' Office 1 • Command Staff * Deputy Chief -Vacant * Lieutenant John Overton -Community Services * Lieutenant Bob Stowe -Uniform Patrol * Lieutenant Tracy Basterrechea -Investigations * Lieutenant Scott Colaianni -Uniform Patrol Thank You * I want to thank the men and women of the Meridian Police Department for another great year. I enjoy and share the pride and professionalism that they display. Our Team * The Meridian Police Department proudly serves our community with 79 officers, 23 support members and 4 part time members for a total of 106 employees. We are organized into three major divisions: Patrol, Criminal Investigations and Community Services. * We partner with our citi2ens in our department and this accounts for over 6,710 volunteer hours of time in 2007. 2 General Information * From 2006 to 2007 we have experienced an increase in reported crime. The total for 2006 was 9,231 and for 2007 the total was 9,232, an increase of less than 1% in reported crimes. The number of offenses in this same period increased by 2%. The city's population increased by approximately 13,000 during this time. * We have the second lowest per capita crime in the State of Idaho. * Decrease of 13 % per capita in crime overall. Crime Rate Comparisons * Kuna 45 per 1000 *Boise 75.1 per 1000 *Nampa 75.4 per 1000 *Caldwell 92.2 Per 1000 *Garden City 104.4 per 1000 * Meridian 40.8 per 1000 How Do We keep Our Crime Rate so Low? • 3 . • • .. ~ ~ ~ ~ ... - _~. - oa .:r. Cc7cl~6a(~Bo~9 p~~u~~o~ ~~c7 C~uf~~~~~ General Information *The number of calls for mm uru om m.arvk. service from 2006 to 2007 increased from „~ _ 51.,578 to 55,422, an increase of 7%. The ;~ highest volume of calls ~°~-~ ~ ~ m ~a ~=-~4 ~~ ~a xi a- Oi OJ 6f 0] OB II~J i5 1] i9 3i D was between 10:00 pm and 11:00 pm. Noteworthy Accomplishments * Graduated 5"' Public Safety Academy class. * Town Hall meeting for Underage Alcohol Consumption. * Neighborhood Watch Community Luncheon. * Re-established the Patrol Bicycle Program. * Participated in first Unified Command for Dairy Days * Established Radio [nteroperability with Fire and EMS. * Governor's Idaho Brightest Star award for MADC. * Third Annual Downtown Neighborhood Cleanup. ]z 4 • • Noteworthy Accomplishments * Added a drug detection dog named Bowser and handler Seth Washburn. * Added Patrol dog named Kai and handler Jeremy Lindley (Kai isheaded back to Holland and we are awaiting a replacement) * New dog has been selected and will be shipped next week (weather dependent). * Partnership with Mountain View High School media students to produce MPD's first recruiting video. * Debut targeted for the Police and Fire Games. t p r~~a~,. C~Y'~ EF IDI~~N .-- FY09 Enhancements I sPeefnily var wl,lwR 9o.ao z cnn,n,aaay sa.,aoas c9m tcronn n.uo s].79o las.zw 1a FY08AIgIro,~N Figures 1]II,OIp) 117.45U1 (88.000) 7 CID ASSI. ~ 54,]]] 1,835 59.053 4 Weapons Mainlcnuncc 5.425 2.920 8.74s 5 Police Twining Sollwam wilhJrawn p 0 Fircorins Safely LVUIP. d,]25 0',]25 7 I~WOOr Range wilhvrvwn 0 a ~ Swlion nxpansi9n wilhOrawn 0 9 FACFS Commcl 9,8]3 9,8]2 10 Dcl¢lives 121 wilhJnwn 0 II SRO 80.]5] 2.1]5 91.17] TOTAI, SJdQ981'.00 5 • • Capital Replacement -Vehicles * 2005 Ford Crown Vic poor 83,000 miles $37,000 * 2005 Ford Crown Vic poor 94,200 miles $37,000 * 2005 Ford Crown Vic poor 93,300 miles $37,000 * 2007 Ford Crown Vic wreck N/A $37,000 * 2001. Dodge Intrepid poor IOS,498 miles $19,500 * 2001 Dodge Intrepid Engine 74,002 miles $19,500 * 2000 Chrysler Van poor 75,445 miles $19,500 * 2005 Honda Motor wreck N/A $19,000 * Total $225,500 16 Capital Replacement -Vehicle Total = $225,500 *$22,500 reduction from FY08 *One Intrepid has blown engine *One replacement for totaled patrol vehicle * One replacement for totaled patrol motorcycle *Insurance reimbursement did not cover replacement costs and I chose to not ask for a budget amendment for 2008 *ICRMP donated crashed motor to PD for parts ,~ Capital Replacement - Computers ~ Computer 2004 Admin Secretary poor $1,450.00 * Computer 2004 Crime Prevention poor $1,450.00 * Computer 2002 Library (Training) poor $1,450.00 * Computer 2002 Library (Training) poor $1,450.00 * Computer 2002 Library(Ttaining) poor $I,4S0.00 * Computer 2002 Conference room poor $1,450:00 * Computer 2002 Public Meeting room poor $1,450.00 * Printers HP LaserJct 4 & Inkjet 2200 poor $1,200.00 * Printer HP CL13000{CSD) tiroke $1,200.00 * Total $12,550.00 tfi 6 • • Enhancements *Total $340,981 (personnel, operating, capital) *FY08 total request was $1,136,788 'Note: Each patrol vehicle will have approximately 25,000 additional miles before replacement. General Information The Battle over Fuel * 323,155 total patrol miles driven in 2007 (does not include, supervisory, investigations, support or admin~ * Approved additional staff for 4/1'0 work week * Added Bicycle Patrols ,t Increased Foot Patrols * Doubled Of£cers in Cars on Overlap Shifts * No Idling of Cars unless Emergency Scene or K-9 Vehicle * Smaller vehicles, smaller engines Additional Items of Note *'Proposed indoor range enhancement totaling approximately 6 million dollars withdrawn. No Capital Improvement Funds. * Proposed building expansion of approximately 5 million dollars withdrawn. No Capital Improvement Funds. * We still need a permanent place of adequate size to [rain with firearms. * Our evidence room is at 87 percent capacity, records is beyond capacity for adequate work space and records storage takes up most of [he room. * Patrol is at capacity and additional work space for report writing is needed. * Women's locker room is beyond capacity. 7 Where Do We Go From Here? * Propose moving savings in 2008 police personnel costs to Public Safety Reserve or a percent of all operations savings be placed into this fund as proposed by finance. * Final PD Payment is 2011 -Continue to place this amount into the Public Safety Reserve Fund. * Seek Funding to promote a Lieutenant and assign them as full-time Project Manager. * Develop Business Plan. * Seek out Potential Financial Partners. * Seek Out Private Industry Interest. End of FY09 Police Budget Presentation *Questions w, :.~.i- .t I t i • Tightening the Belt * Withdra\vn Enhancements * Parks/Pathways Planner SS4,344 *Settlecs Village Square Ph. 2 SI.ZI?,3~5 Heroes Park Options * Remove Construction Nl~mt -$71.594 * Keclaimed Water Parmership* -$75.000 * Constriction Docs S6K -$149.594 * Restroom Bldg $SOK * I rriSat ion $i K * SiCnage $ I K * Trees $ I OK * Comingency $3K * Previous Total $940.750 *Revised Total $790,856 * PAL Partnership Reimbursement $325,000 * Impact Fee Eligible Reimbursement up to $500,000 'Depends on approving Enferpdse Fund Project Settlers Village Square Ph. 1 * Borrow from Land Purchase Account (Impact Fees) *Replace using $150,000 Enhancement *Build This Fall * Best chance for project to be under budget *Elig~ible for Impact Fee Reimbursement C~jV~ ~ ~~~ ~ ®zQOs ~~~~ 1 ~~ • ' New Truck (Year Round) * 1 Ton 4WD $21.000 * 1 Ton 2 W D $15,000 *=Y4 Ton 4WD $20.000 * Difference -54,675 *Sno~wplo~~~ needed *Cannot get to e~~erv location in a timely manner * Backup Community Center Furnishings * 10 Tables $700 * Witl look into Recycled materials HMS Fencing *$20,000 Offset from School District *$25 per Team Fee Increase * Will research/report on benefit to City of Meridian 2 '! ~ .., Tree Inventory Software * Remove Tree\\/orks Software -S7.000 * Remove Rroaram Sbtpport -5600 *Keep GIS. Cin-ix License. GPS *See if PW Asset i\rlQmt Soft~a~are can work over next year (if funded). Christmas Decorations * Reduce SS3;500 (56,300 City) request to 542.900 (520;600 City) Summary * Heroes Park* -$149,894 * Settlers Village Square Ph 1 ~ Reimburse with Impact Fees * Transfer to Impact Fee Eligible Park ~r New Truck -$4,675 * HMS Fencing -$20,000 * Tree Inventory Software* -$7,600 ~ Christmas Decorations - 35.700 * Total -$217,869 * Note: Additional Funds will be offset by Impact Fees and PAL Partnership 'Depends on approval o/ other projects 3 ~~ RECEIVED ~UL f 0 2008 City lei ~~ Office of the Attorney General Idaho Ethics In Government Manual ,~. ~r ~~ ,, s ,~ JULY 2007 LAWRENCE WASDEN Attorney General 700 West State Street Boise, ID 83720-0010 www.ag.idaho.gov State of Idaho Office of Attorney General Lawrence Wasden INTRODUCTION Honest and open government is fundamental to a free society. The Idaho Legislature has formalized our state's commitment to honest and ethical government by enacting several statutes governing the ethical behavior of public officers. These laws are intended to ensure that public officials remain public servants. Idaho has three primary statutes governing ethics in government: the Bribery and Corrupt Influence Act; the Prohibition Against Contracts with Officers Act; and the Ethics in Government Act. In addition, statutes that govern a particular state agency; state subdivision or municipal corporation o8en contain provisions regulating the ethical behavior of public officials. Any complete analysis of an ethical question involving a public official must include the three acts named above as well as statutes dealing specifically with the governmental .agency, office or subdivision involved. Specific statutes relating to the particular agency or subdivision will control over the more general statutes. When two or more general statutes apply to the same subject, an attempt should be made to reconcile the statutes. All of us who accept public office, whether elected or appointed, also accept an ethical duty to serve honestly and in the public's interest. While the state and the people must demand compliance with Idaho's ethics laws, public officials should understand that these laws set a minimum standard of behavior. Crossing these lines can result in fines and incarceration. Responsible and ethical public officials hold themselves to an even higher standard than mere compliance. My Intergovernmental and Fiscal Law Division has prepared this legal manual for your information. I hope it assists you when. presented with applicable situations. Sincerely, LAWRENCE G. WASDEN Attorney General TABLE OF CONTENTS RELEVANT STATUTES ...........................................................................................................................................1 BRIBERY AND CORRUPT INFLUENCE ACT ..................................................................................................................1 PROHIBITIONS AGAINST CONTRACTS WITH OFFICERS ...............................................................................................E> ETHICS IN GOVERNMENT ACT ...................................................................................................................................8 MISCELLANEOUS STATUTES ....................................................................................................................................11 QUESTIONS AND ANSWERS ................................................................................................................................14 STATUTORY INTERPRETATION .................................................................................................................................14 PURPOSE OF ANALYSIS OF ETHICS STATUTES ........................................................................................................14 PUBLIC EMPLOYEES OR OFFICIALS COVERED BY ETHICS STATUTES ......................................................................14 NEPOTISM ................................................................................................................................................................15 CONFLICTS OF INTEREST/PROHIBITED CONTRACTS ................................................................................................1 E BRIBERY/CORRUPT INFLUENCE & GIFTS TO PUBLIC OFFICIALS .............................................................................18 INCOMPATIBILITY OF OFFICE ..................................................................................................................................20 CONSANGUINITY CHART ...................................................................................................................................22 INDEX OF ADDITIONAL CONFLICTS OF INTEREST STATUTES .............................................................23 Idaho Ethics In Government RELEVANT STATUTES Briberv and Corrupt Influence Act 18-1351. Bribery and corrupt practices -Definitions. Unless a different meaning plainly is required in this chapter: (1) "Benefit" means gain or advantage, or anything regarded by the beneficiary as gain or advantage, including benefit to any other person or entity in whose welfare he is interested, but not an advantage promised generally to a group or class of voters as a consequence of public measures which a candidate engages to support or oppose. (2) "Confidential information" means knowledge gained through a public office, official duty or employment by a governmental entity which is not subject to disclosure to the general public and which, if utilized in financial transactions would provide the user with an advantage over those not having such information or result in harm to the governmental entity from which it was obtained. (3) "Government" includes any branch, subdivision or agency of the government of the state or any locality within it and other political subdivisions including, but not limited. to, highway districts, planning and zoning commissions and cemetery districts, and all other governmental districts, commissions or governmental bodies not specif cally mentioned in this chapter. (4) "Harm" means loss, disadvantage or injury, including loss, disadvantage or injury to any other person or entity in whose welfare he is interested. (5) "Official proceeding" means a proceeding heard or which may be heard before any legislative, judicial, administrative or other governmental agency or official authorized to take evidence under oath, including any referee, hearing examiner, commissioner, notary or other person taking testimony or deposition in connection with any such proceeding. (6) "Party official" means a person who holds an elective or appointive post in a political party in the United States by virtue of which he directs or conducts, or participates in directing or conducting party affairs at any level of responsibility. (7) "Pecuniary benefit" is any benefit to a public official or member of his household in the form of money, property or commercial interests, the primary significance of which is economic gain. (8) "Public servant" means any officer or employee of government, including legislators and judges, and any person participating as juror, advisor, consultant or otherwise, in performing a governmental function; but the term does not include witnesses. (9) "Administrative proceeding" means any proceeding, other than a judicial proceeding, the outcome of which is required to be based on a record or documentation prescribed by law, or in which law or regulation is particularized in application to individuals. 18-1352. Bribery in official and political matters. A person is guilty of bribery, a felony, if he offers, confers or agrees to confer upon another, or solicits, accepts or agrees to accept from another: (1) Any pecuniary benefit as consideration for the recipient's decision, opinion, recommendation, vote or other exercise of discretion as a public servant, party official or voter; or • Idaho Ethics In Government (2) Any benefit as consideration for the recipient's decision, vote, recommendation or other exercise of official discretion in a judicial or administrative proceeding; or (3) Any benefit as consideration for a violation of a known legal duty as public servant or party official. It is no defense to prosecution under this section that a person whom the actor sought to influence was not qualified to act in the desired way whether because he had not yet assumed office, or lacked jurisdiction, or for any other reason. 18-1353. Threats and other improper influence in official and political matters (1) Offenses defined. A person commits an offense if he: (a) threatens unlawful harm to any person with purpose to influence his decision, opinion, recommendation, vote or other exercise of discretion as a public servant, party offcial or voter; or (b) threatens harm to any public servant with purpose to influence his decision, opinion, recommendation, vote or other exercise of discretion in a judicial or administrative proceeding; or (c) threatens harm to any public servant or party official with purpose to influence him to violate his known legal duty; or (d) privately addresses to any public servant who has or will have an official discretion in a judicial or administrative proceeding any representation, entreaty, argument or other communication with purpose to influence the outcome on the basis of considerations other than those authorized by law. It is no defense to prosecution under this section that a person whom the actor sought to influence was not qualified to act in the desired way, whether because he had not yet assumed office, or lacked jurisdiction, or for any other reason. (2) Grading. An offense under this section is a misdemeanor unless the actor threatened to commit a crime or made a threat with purpose to influence a judicial or administrative proceeding, in which cases the offense is a felony. 18-i353A. Threats against state officials of the executive, legislative or judicial branch Whoever knowingly and willfully deposits for conveyance in the mail or for a delivery from any post office or by any letter carrier, any letter, paper, writing, print, missive, or document containing any threat to take the life of or to inflict bodily harm upon any state elected official of the executive or legislative branch, or any justice, judge or magistrate of the judicial branch, or person appointed to fill the vacancy of a state elected official of the executive or legislative branch of the state of Idaho, or knowingly and willfully otherwise makes any such threat against a state elected official of the executive or legislative branch, or any justice, judge or magistrate of the judicial branch, or person appointed to fill the vacancy of a state elected official of the executive or legislative branch of the state of Idaho is guilty of a misdemeanor and upon conviction thereof shall be fined not to exceed one thousand dollars ($1,000) and shall be sentenced to not to exceed one (1) year in the county jail. If such threat is made while the defendant exhibits a firearm or other dangerous or deadly weapon, the defendant shall be guilty of a felony. Upon a second or subsequent conviction of an offense under this section, the defendant shall be guilty of a felony and shall be sentenced to a term of not to exceed five (5) years in the state penitentiary. 18-1354. Compensation for past official behavior A person commits a misdemeanor if he solicits, accepts, or agrees to accept any pecuniary benefit as compensation for having as public servant, given a decision, opinion, recommendation or vote favorable to another, or for having otherwise exercised a discretion in his favor, or for having violated his duty. A person commits a misdemeanor if he offers, confers or agrees to confer, compensation, acceptance of which is prohibited by this section. 18-1355. Retaliation for past official action. Idaho Ethics In Government A person commits a misdemeanor if he harms another by any unlawful acts in retaliation for anything lawfully done by the latter in the capacity of public servant. 18-1356. Gifts to public servants by persons subject to their jurisdiction (1) Regulatory and law enforcement officials. No public servant in any department or agency exercising regulatory functions, or conducting inspections or investigations, or carrying on civil or criminal litigation on behalf of the government, or having custody of prisoners, shall solicit, accept or agree to accept any pecuniary benefit from a person known to be subject to such regulation, inspection, investigation or custody, or against whom such litigation is known to be pending or contemplated. (2) Officials concerned with government contracts and pecuniary transactions. No public servant having any discretionary function to perform in connection with contracts, purchases, payments, claims or other pecuniary transactions of the government shall solicit, accept or agree to accept any pecuniary benefit from any person known to be interested in or likely to become interested in any such contract, purchase, payment, claim or transaction. (3) Judicial and administrative officials. No public servant having judicial or administrative authority and no public servant employed by or in a court or other tribunal having such authority, or participating in the enforcement of its decisions, shall solicit, accept or agree to accept any pecuniary benefit from a person known to be interested in or likely to become interested in any matter before such public servant or a tribunal with which he is associated. (4) Legislative officials. No legislator or public servant employed by the legislature or by any committee or agency thereof shall solicit, accept or agree to accept any pecuniary benefit in return for action on a bill, legislation, proceeding or official transaction from any person known to be interested in a bill, legislation, official transaction or proceeding, pending or contemplated before the legislature or any committee or agency thereof. (5) Exceptions. This section shall not apply to: (a) fees prescribed by law to be received by a public servant, or any other benefit for which the recipient gives legitimate consideration or to which he is otherwise legally entitled; or (b) gifts or other benefits conferred on account of kinship or other personal, professional or business relationship independent of the official status of the receiver; or (c) trivial benefits not to exceed a value of fifty dollars ($50.00) incidental to personal, professional or business contacts and involving no substantial risk of undermining official impartiality. (6) Offering benefits prohibited. No person shall knowingly confer, or offer or agree to confer, any beneft prohibited by the foregoing subsections. (7) Grade of offense. An offense under this section is a misdemeanor and shall be punished as provided in this chapter. 18-1357. Compensating public servant for assisting private interests in relation to matters before him (1) Receiving compensation. A public servant commits a misdemeanor if he solicits, accepts or agrees to accept compensation for advice or other assistance in preparing or promoting a bill, contract, claim, or other transaction or proposal as to which he knows that he has or is likely to have an official discretion to exercise. (2) Paying compensation. A person commits a misdemeanor if he pays or offers or agrees to pay compensation to a public servant with knowledge that acceptance by the public servant is unlawful. ~- ~a Idaho Ethics In Government 18-1358. Selling political endorsement -Special influence. (1) Selling political endorsement. A person commits a misdemeanor if he solicits, receives, agrees to receive, or agrees that any political party or other person shall receive any pecuniary benefit as consideration for approval or disapproval of an appointment or advancement in public service, or for approval or disapproval of any person or transaction for any benefit conferred by an official or agency of the government. "Approval" includes recommendations, failure to disapprove, or any other manifestation of favor or acquiescence. "Disapproval" includes failure to approve, or any other manifestation of disfavor or non-acquiescence (2) Other trading in special influence. A person commits a misdemeanor if he solicits, receives or agrees to receive any pecuniary benefit as consideration for exerting special influence upon a public servant or procuring another to do so. "Special influence" means power to influence through kinship, friendship, or other relationship apart from the merits of the transaction. (3) Paying for endorsement or special influence. A person commits a misdemeanor if he offers, confers or agrees to confer any pecuniary benefit, receipt of which is prohibited by this section. 18-1359. Using public position for personal gain. (1) No public servant shall: (a) Without the specific authorization of the governmental entity for which he serves, use public funds or property to obtain a pecuniary benefit for himself. (b) Solicit, accept or receive a pecuniary benefit as payment for services, advice, assistance or conduct customarily exercised in the course of his official duties. This prohibition shall not include trivial benefits not to exceed a value of fifty dollars ($50.00) incidental to personal, professional or business contacts and involving no substantial risk of undermining official impartiality. (c) Use or disclose confidential information gained in the course of or by reason of his official position or activities in any manner with the intent to obtain a pecuniary benefit for himself or any other person or entity in whose welfare he is interested or with the intent to harm the governmental entity for which he serves. (d) Be interested in any contract made by him in his official capacity, or by any body or board of which he is a member, except as provided in section 18-1361, Idaho Code. (e) Appoint or vote for the appointment of any person related to him by blood or marriage within the second degree, to any clerkship, office, position, employment or duty, when the salary, wages, pay or compensation of such appointee is to be paid out of public funds or fees of office, or appoint or furnish employment to any person whose salary, wages, pay or compensation is to be paid out of public funds or fees of office, and who is related by either blood or marriage within the second degree to any other public servant when such appointment is made on the agreement or promise of such other public servant or any other public servant to appoint or furnish employment to anyone so related to the public servant making or voting for such appointment. Any public servant who pays out of any public funds under his control or who draws or authorizes the drawing of any warrant or authority for the payment out of any public fund of the salary, wages, pay, or compensation of any such ineligible person, knowing him to be ineligible, is guilty of a misdemeanor and shall be punished as provided in this chapter. (f) Unless specifically authorized by another provision of law, commit any act prohibited of members of the legislature or any officer or employee of any branch of the state government by section 67- 5726, Idaho Code, violations of which are subject to penalties as provided in section 67-5734, Idaho Code, which prohibition and penalties shall be deemed to extend to all public servants pursuant to the provisions of this section. Idaho Ethics In Government (2) No person related to any member of the legislature by blood or marriage within the second degree shall be appointed to any clerkship, office, position, employment or duty within the legislative branch of government or otherwise be employed by the legislative branch of government when the salary, wages, pay or compensation of such appointee or employee is to be paid out of public funds. (3) No person related to a mayor or member of a city council by blood or marriage within the second degree shall be appointed to any clerkship, office, position, employment or duty with the mayor's or city council's city when the salary, wages, pay or compensation of such appointee or employee is to be paid out of public funds. (4) No person related to a~ county commissioner by blood or marriage within the second degree shall be appointed to any clerkship, office, position, employment or duty with the commissioner's county when the salary, wages, pay or compensation of such appointee or employee is to be paid out of public funds. (5) (a) An employee of a governmental entity holding a position prior to the election of a local government official, who is related within the second degree, shall be entitled to retain his or her position and receive general pay increases, step increases, cost of living increases, and/or other across the board increases in salary or merit increases, benefits and bonuses or promotions. (b) Nothing in this section shall be construed as creating any property rights in the position held by an employee subject to this section, and all authority in regard to disciplinary action, transfer, dismissal, demotion or termination shall continue to apply to the employee. (6) The prohibitions contained within this section shall not include conduct defined by the provisions of section 59-703(4), Idaho Code. (7) The prohibitions within this section and section 18-1356, Idaho Code, as it applies to part-time public servants, do not include those actions or conduct involving the public servant's business, profession or occupation and unrelated to the public servant's official conduct, and do not apply to a pecuniary benefit received in the normal course of a legislator's business, profession or occupation and unrelated to any bill, legislation, proceeding or official transaction. 18-1360. Penalties. Any public servant who violates the provisions of this chapter, unless otherwise provided, shall be guilty of a misdemeanor and may be punished by a fine not exceeding one thousand dollars ($1,000), or by incarceration in the county jail for a period not exceeding one (1) year, or by both such fine and incarceration. In addition to any penalty imposed in this chapter, any person who violates the provisions of this chapter may be required to forfeit his office and may be ordered to make restitution of any benefit received by him to the governmental entity from which it was obtained. 18-1361. Self-interested contracts -Exception. Where there are less than three (3) suppliers of a good or a service within a fifteen (15) mile radius of where the good or service is to be provided, it shall not constitute a violation of the provisions of subsection (1) (d) or (e) of section 18-1359, Idaho Code, for a public servant or for his relative to contract with the public body of which the public servant is a member if the contract is reasonably necessary to respond to a disaster as defined in chapter 10, title 46, Idaho Code, or if the procedures listed below are strictly observed. For purposes of this section, "relative" shall mean any person related to the public servant by blood or marriage within the second degree. (1) The contract is competitively bid and the public servant or his relative submits the low bid; and (2) Neither the public servant nor his relative takes any part in the preparation of the contract or bid specifications, and the public servant takes no part in voting on or approving the contract or bid specifications; and Idaho Ethics In Government (3) The public servant makes full disclosure, in writing, to all members of the governing body, council or board of said public body of his interest or that of his relative and of his or his relative's intention to bid on the contract; and (4) Neither the public servant nor his relative has violated any provision of Idaho law pertaining to competitive bidding or improper solicitation of business. 18-1361A. Non-compensated appointed public servant -Relatives of public servant -Exception. When a person is a public servant by reason of his appointment to a governmental entity board for which the person receives no salary or fees for his service on said board, it shall not constitute a violation of the provisions of subsection (1)(d) or (e) of section 18-1359, Idaho Code, for a public servant or for his relative to contract with the public body of which the public servant is a member if the procedures listed below are strictly observed. For purposes of this section, "relative" shall mean any person related to the public servant by blood or marriage within the second degree. (1) The contract is competitively bid and the public servant or his relative submits the low bid; and (2) Neither the public servant nor his relative takes any part in the preparation of the contract or bid specifications, and the public servant takes no part in voting on or approving the contract or bid specifications; and (3) The public servant makes full disclosure, in writing, to all members of the governing body, council or board of said public body of his interest or that of his relative and of his or his relative's intention to bid on the contract; and (4) Neither the public servant nor his relative has violated any provision of Idaho law pertaining to competitive bidding or improper solicitation of business. 18-1362. Cause of action. A prosecuting attorney or the attorney general may bring an action in the district court of the county in which a public servant resides to enjoin a violation of the provisions of this chapter and to require the public servant to make restitution to the government of any pecuniary gain obtained. The prevailing party shall be awarded his costs and reasonable attorney fees. Prohibitions Against Contracts with Officers 59-201. Officers not to be interested in contracts. Members of the legislature, state, county, city, district and precinct officers, must not be interested in any contract made by them in their official capacity, or by any body or board of which they are member. 59-201A. Remote interests. (1) A public officer shall not be deemed to be interested in a contract, within the meaning of section 59- 201, Idaho Code, if he has only a remote interest in the contract and if the fact and extent of such interest is disclosed to the body of which he is an officer and noted in the official minutes or similar records prior to the formation of the contract, and thereafter the governing body authorizes, approves, or ratifies the contract in good faith by a vote of its membership sufficient for the purpose without counting the vote or votes of the officer having the remote interest. As used in this section, "remote interest" means: (a) That of anon-salaried officer of a nonprofit corporation; or (b) That of an employee or agent of a contracting party where the compensation of such employee or agent consists entirely of fixed wages or salary; or Idaho Ethics In Government (c) That of a landlord or tenant of a contracting party; or (d) That of a holder of less than one percent (1%) of the shares of a corporation or cooperative which is a contracting party. (2) Although a public official's interest in a contract may be only remote, a public official shall not influence or attempt to influence any other officer of the board of which he is an offcer to enter into the contract. Violation of the provisions of this subsection shall be a misdemeanor as provided in section 59-208, Idaho Code. Any contract created or entered into in violation of the provisions of this subsection shall be void. 59-202. Officers not to be interested in sales. State, county, district, precinct and city officers must not be purchasers at any sale nor vendors at any purchase made by them in their official capacity. 59-203. Prohibited contracts voidable. Every contract made in violation of any of the provisions of the two (2) preceding sections may be avoided at the instance of any party except the officer interested therein. 59-204. Dealing in warrants prohibited. The state treasurer and state controller, the several county, city, district or precinct officers of this state, their deputies and clerks, are prohibited from purchasing or selling, or in any manner receiving to their own use or benefit, or to the use or benefit of any person or persons, whatever, any state, county, or city warrants, scrip, orders, demands, claims, or other evidences of indebtedness against the state, or any county or city thereof, except evidences of indebtedness issued to or held by them for services rendered as such officer, deputy or clerk, and evidences of the funded indebtedness of such state, county, city, district or corporation. 59-205. Affidavit of non-violation a prerequisite to allowance of accounts. Every officer whose duty it is to audit and allow the accounts of other state, county, district, city or precinct officers, must, before allowing such accounts, require each of such officers to make and file with him an affidavit that he has not violated any of the provisions of this chapter. 59-206. Provisions of chapter violated -Disbursing officer not to pay warrants. Officers charged with the disbursement of public moneys must not pay any warrant or other evidence of indebtedness against the state, county, city or district, when the same has been purchased, sold, received or transferred contrary to any of the provisions of this chapter. 59-207. Suspension of settlement or payment -Prosecution of offenders. Every officer charged with the disbursement of public moneys, who is informed by affidavit that any officer whose account is to be settled, audited, or paid by him, has violated any of the provisions of this chapter, must suspend such settlement or payment, and cause such officer to be prosecuted for such violation. 59-208. Violation. A violation of the provisions of this chapter, unless otherwise provided, is a misdemeanor and shall be punished by a fine not exceeding one thousand dollars ($1,000), or incarceration in the county jail for a period not exceeding one (1) year, or by both such fine and incarceration. Idaho Ethics In Government 59-209. Non-compensated public official -Exception. When a person is a public official by reason of his appointment or election to a governing board of a governmental entity for which the person receives no salary or fee as compensation for his service on said board, he shall not be prohibited from having an interest in any contract made or entered into by the board of which he is a member, if he strictly observes the procedure set out in section 18-1361A, Idaho Code. 59-210. Violation relating to public contracts. Officers shall not commit any act prohibited by section 67-5726, Idaho Code, violations of which are subject to penalties as provided in section 67-5734, Idaho Code, and which prohibitions and penalties shall be deemed to extend to all public officers governed by the provisions of this chapter. Ethics in Government Act 59-701. Short title. This act shall be known and may be cited as the "Ethics in Government Act of 1990." 59-7.02. Policy and purpose. It is hereby declared that the position of a public official at all levels of government is a public trust and it is in the public interest to: (1) Protect the integrity of government throughout the state of Idaho while at the same time facilitating recruitment and retention of personnel needed within government; (2) Assure independence, impartiality and honesty of public officials in governmental functions; (3) Infonn citizens of the existence of personal interests which may present a conflict of interest between an official's public trust and private concerns; (4) Prevent public office from being used for personal gain contrary to the public interest; (5) Prevent special interests from unduly influencing governmental action; and (6) Assure that governmental functions and policies reflect, to the maximum extent possible, the public interest. 59-703. Definitions. -For purposes of this chapter: (1) "Official action" means any decision on, or proposal, consideration, enactment, defeat, or making of any rule, regulation, rate-making proceeding or policy action or non-action by a governmental body or any other policy matter which is within the official jurisdiction of the governmental body. (2) "Business" means any undertaking operated for economic gain, including, but not limited to, a corporation, partnership, trust, proprietorship, firm, association or joint venture. (3) "Business with which a public official is associated" means any business of which the public official or member of his household is a director, officer, owner, partner, employee or holder of stock over five thousand dollars ($5,000) or more at fair market value. (4) "Conflict of interest" means any official action or any decision or recommendation by a person acting in a capacity as a public official, the effect of which would be to the private pecuniary benefit of the person or a • Idaho Ethics In Government member of the person's household, or a business with which the person or a member of the person's household is associated, unless the pecuniary benefit arises out of the following: (a) An interest or membership in a particular business, industry, occupation or class required by law as a prerequisite to the holding by the person of the office or position; (b) Any action in the person's official capacity which would affect to the same degree a class consisting of an industry or occupation group in which the person, or a member of the person's household or business with which the person is associated, is a member or is engaged; (c) Any interest which the person has by virtue of his profession, trade or occupation where his interest would be affected to the same degree as that of a substantial group or class of others similarly engaged in the profession, trade or occupation; (d) Any action by a public official upon any revenue measure, any appropriation measure or any measure imposing a tax, when similarly situated members of the general public are affected by the outcome of the action in a substantially similar manner and degree. (5) "Economic gain" means increase in pecuniary value from sources other than lawful compensation as a public official. (6) "Governmental entity" means: (a) The state of Idaho and all agencies, commissions and other governmental bodies of the state; and (b) Counties and municipalities of the state of Idaho, all other political subdivisions including, but not limited to, highway districts, planning and zoning commissions or governmental bodies not specifically mentioned in this chapter. (7) "Members of a household" mean the spouse and dependent children of the public official and/or persons whom the public official is legally obligated to support. (8) "Person" means an individual, proprietorship, partnership, association, trust, estate, business trust, group or corporation, whether operated for profit or not, and any other legal entity, or agent or servant thereof, or a governmental entity. (9) "Public office" means any position in which the normal and usual duties are conducted on behalf of a governmental entity. (10) "Public official" means any person holding public office in the following capacity: (a) As an elected public official meaning any person holding public office of a governmental entity by virtue of an elected process, including persons appointed to a vacant elected office of a governmental entity, excluding members of the judiciary; or (b) As an elected legislative public official meaning any person holding public office as a legislator; or (c) As an appointed public official meaning any person holding public office of a governmental entity by virtue of formal appointment as required by law; or (d) As an employed public official meaning any person holding public office of a governmental entity by virtue of employment, or a person employed by a governmental entity on a consultative basis. • Idaho Ethics In Government 59-704. Required action in conflicts. A public official shall not take any official action or make a formal decision or formal recommendation concerning any matter where he has a conflict of interest and has failed to disclose such conflict as provided in this section. Disclosure of a conflict does not affect an elected public official's authority to be counted for purposes of determining a quorum and to debate and to vote on the matter, unless the public official requests to be excused from debate and voting at his or her discretion. In order to determine whether a conflict of interest exists relative to any matter within the scope of the official functions of a public official, a public official may seek legal advice from the attorney representing that governmental entity or from the attorney general or from independent counsel. If the legal advice is that no real or potential conflict of interest exists, the public official may proceed and shall not be subject to the prohibitions of this chapter. If the legal advice is that a real or potential conflict may exist, the public official: (1) If he is an elected legislative public official, he shall disclose the nature of the potential conflict of interest and/or be subject to the rules of the body of which he/she is a member and shall take all action required under such rules prior to acting on the matter. If a member requests to be excused from voting on an issue which involves a conflict or a potential conflict, and the body of which he is a member does not excuse him, such failure to excuse shall exempt that member from any civil or criminal liability related to that particular issue. (2) If he is an elected state public official, he shall prepare a written statement describing the matter required to be acted upon and the nature of the potential conflict, and shall file such statement with the secretary of state prior to acting on the matter. A public official may seek legal advice from the attorney representing that agency or from the attorney general or from independent counsel. The elected public off cial may then act on the advice of the agency's attorney, the attorney general or independent counsel. (3) If he is an appointed or employed state public official, he shall prepare a written statement describing the matter to be acted upon and the nature of the potential conflict, and shall deliver the statement to his appointing authority. The appointing authority may obtain an advisory opinion from the attorney general or from the attorney representing that agency. The public official may then act on the advice of the attorney general, the agency's attorney or independent counsel. (4) If he is an elected public official of a county or municipality, he shall disclose the nature of a potential conflict of interest prior to acting on a matter and shall be subject to the rules of the body of which he/she is a member and take all action required by the rules prior to acting on the matter. If a member requests to be excused from voting on an issue, which involves a conflict or a potential conflict, and the body of which he is a member, does not excuse him, such failure to excuse shall exempt that member from any civil or criminal liability related to that particular issue. The public official may obtain an advisory opinion from the attorney general or the attorney for the county or municipality or from independent counsel. The public official may then act on the advice of the attorney general or attorney for the county or municipality or his independent counsel. (5) If he is an appointed or employed public official of a county or municipality, he shall prepare a written statement describing the matter required to be acted upon and the nature of the potential conflict, and shall deliver the statement to his appointing authority. The appointing authority may obtain an advisory opinion from the attorney for the appointing authority, or, if none, the attorney general. The public official may then act on the advice of the attorney general or attorney for the appointing authority or independent counsel. (6) Nothing contained herein shall preclude the executive branch of state government or a political subdivision from establishing an ethics board or commission to perform the duties and responsibilities provided for in this chapter. Any ethics board or commission so established shall have specifically stated powers and duties including the power to: (a) Issue advisory opinions upon the request of a public official within its jurisdiction; (b) Investigate possible unethical conduct of public officials within its jurisdiction and conduct hearings, issue findings, and make recommendations for disciplinary action to a public official's appointing authority; 10 Idaho Ethics In Government C~ (c) Accept complaints of unethical conduct from the public and take appropriate action. 59-704A. Non-.compensated public official -Exception. When a person is a public official by reason of his appointment or election to a governing board of a governmental entity for which the person receives no salary or fee as compensation for his service on said board, he shall not be prohibited from having an interest in any contract made or entered into by the board of which he is a member, if he strictly observes the procedure set out in section 18-1361A, Idaho Code. 59-705. Civil penalty. (1) Any public official who intentionally fails to disclose a conflict of interest as provided for in section 59- 704, Idaho Code, shall be guilty of a civil offense, the penalty for which may be a fine not to exceed five hundred dollars ($500), provided that the provisions of this subsection shall not apply to any public official where the governmental entity on which said official serves has put into operation an ethics commission or board described in section 59-704(6), Idaho Code. (2) The penalty prescribed in subsection (1) of this section does not limit the power of either house of the legislature to discipline its own members, nor limit the power of governmental entities, including occupational or professional licensing bodies, to discipline their members or personnel. A violation of the provisions of this chapter shall not preclude prosecution and conviction for any criminal violation that may have been committed. Miscellaneous Statutes 31-2606. Prohibitions. No prosecuting attorney must receive any fee or rewards for or on behalf of any prosecutor or other individual, for services in any prosecution, or business to which it is his official duty to attend or discharge; nor be concerned as attorney or counsel for either party other than for the state, people or county, in any civil action depending upon the same state of facts, upon which any criminal prosecution commenced but not determined depends, and no law partner of any county attorney must be engaged in the defense of any suit, action or proceeding, in which said prosecuting attorney appears on behalf of the people, state or county. 33-507. Limitation upon authority of trustees. It shall be unlawful for any trustee to have pecuniary interest directly or indirectly in any contract or other transaction pertaining to the maintenance or conduct of the school district, or to accept any reward or compensation for services rendered as a trustee except as may be otherwise provided in this section. The board of trustees of a school district may accept and award contracts involving the school district to businesses in which a trustee or a person related to him by blood or marriage within the second degree has a direct or indirect interest provided that the procedures set forth in section 18-1361 or 18-1361A, Idaho Code, are followed. The receiving, soliciting or acceptance of moneys of a school district for deposit in any bank or trust company, or the lending of money by any bank or trust company to any school district, shall not be deemed to be a contract pertaining to the maintenance or conduct of a school district within the meaning of this section; nor shall the payment by any school district board of trustees of compensation to any bank or trust company for services rendered in the transaction of any banking business with such district board of trustees, be deemed the payment of any reward or compensation to any officer or director of any such bank or trust company within the meaning of this section. It shall be unlawful for the board of trustees of any class of school district to enter into or execute any contract with the spouse of any member of such board, the terms of which said contract requires, or will require, the payment or delivery of any school district funds, money or property to such spouse, except as provided in section 18-1361 or 18- 1361A, Idaho Code. When any relative of any trustee or relative of the spouse of a trustee related by affinity or consanguinity within the second degree is considered for employment in a school district, such trustee shall abstain from voting in the 11 • • Idaho Ethics In Government election of such relative, and shall be absent from the meeting while such employment is being considered and determined. 59-102. Legislators disqualified from holding certain offices. It shall be unlawful for any member of the legislature, during the term for which he was elected, to accept or receive, or for the governor, or other officials or board, to appoint such member of the legislature to, any office of trust, profit, honor or emolument, created by any law passed by the legislature of which he is a member. Any appointment made in violation of this section shall be null and void and without force and effect, and any attempt to exercise the powers of such office by such appointee shall be a usurpation, and the appointee shall be deemed guilty of a misdemeanor, and, on conviction, shall be fined not less than $500 nor more than $5000. 67-5726. Prohibitions. (I) No contract or order or any interest therein shall be transferred by the contractor or vendor to whom such contract or order is given to any other party, without the approval in writing of the administrator. Transfer of a contract without approval shall cause the annulment of the contract so transferred, at the option of the state. All rights of action, however, for any breach of such contract by the contracting parties are reserved to the state. No member of the legislature or any officer or employee of any branch of the state government shall directly, himself, or by any other person in trust for him or for his use or benefit or on his account, undertake, execute, hold or enjoy, in whole or part, any contract or agreement made or entered into by or on behalf of the state of Idaho, if made by, through, or on behalf of the department in which he is an officer or employee; or if made by, through or on behalf of any other department unless the same is made after competitive bids. (2) Except as provided by section 67-5718, Idaho Code, no officer or employee shall influence or attempt to influence the award of a contract to a particular vendor, or to deprive or attempt to deprive any vendor of an acquisition contract. (3) No officer or employee shall conspire with a vendor or its agent, and no vendor or its agent shall conspire with an officer or employee, to influence or attempt to influence the award of a contract, or to deprive or attempt to deprive a vendor of an acquisition award. (4) No officer or employee shall fail to utilize an open contract without justifiable cause for such action. No officer or employee shall accept property which he knows does not meet specifications or substantially meet the original performance test results. (5) Deprivation, influence or attempt thereat shall not include written reports, based upon substantial evidence, sent to the administrator of the division of purchasing concerning matters relating to the responsibility of vendors. (6) No vendor or related party, or subsidiary, or affiliate of a vendor may submit a bid to obtain a contract to provide property to the state, if the vendor or related party, or affiliate or subsidiary was paid for services utilized in preparing the bid specifications or if the services influenced the procurement process. [I.C., § 67-5726, as added by 1975, ch. 254, § 2, p. 686; am. 1991, ch. 158, § 5, p. 374; am. 1994, ch. 110 § 1, p. 243; am. 2001, ch. 36, § 7, p. 55.] 67-6506. Conflict of interest prohibited. A governing board creating a planning, zoning, or planning and zoning commission, or joint commission shall provide that the area and interests within its jurisdiction are broadly represented on the commission. A member or employee of a governing board, commission, or joint commission shall not participate in any proceeding or action when the member or employee or his employer, business partner, business associate, or any person related to him by affinity or consanguinity within the second degree has an economic interest in the procedure or action. Any actual or potential interest in any proceeding shall be disclosed at or before any meeting at which the action is being heard or considered. For purposes of this section the term "participation" means engaging in activities which constitute 12 Idaho Ethics In Government • deliberations pursuant to the open meeting act. No member of a governing board or a planning and zoning commission with a conflict of interest shall participate in any aspect of the decision-making process concerning a matter involving the conflict of interest. A member with a conflict of interest shall not be prohibited from testifying at, or presenting evidence to, a public hearing or similar public process after acknowledging nonparticipation in the matter due to a conflict of interest. A knowing violation of this section shall be a misdemeanor. 13 • Idaho Ethics In Government QUESTIONS AND ANSWERS STATUTORY INTERPRETATION • Question No. 1: Is there overlap between the various ethical statutes pertaining to public employees and officials, and how should the statutes be analyzed? Answer: Yes. The first step in analyzing which statute applies to a particular situation is to determine whether there is a specific statute dealing with the governmental entity or the public position in question. For example, Idaho Code § 33-507 contains a prohibition against school board trustees contracting with the school district. This statute controls the more general anti-contracting provisions found in chapter 13, title 18, or chapter 2, title 59, Idaho Code. See, Attorney General Opinion No. 93-10. In addition, when dealing with the more general ethics statutes, there may be some overlap. In the case where two or more general statutes apply to the same situation, an attempt should be made to reconcile the statutes. Too often, conflict analysis begins and ends with an analysis of chapter 59 of title 7, the Ethics in Government Act. Chapter 59 covers acts by members of legislative or administrative bodies and does not necessarily prohibit any act, but merely requires disclosure. However, the action creating the conflict may be prohibited by other provisions contained within the Idaho Code. PURPOSE OF ANALYSIS OF ETHICS STATUTES Question No. 2: What is the purpose of the analysis of the ethical statutes with regard to the actions of public officials? Answer: The purpose of the ethical statutes is to establish a ground floor for conduct by public officials. Proper analysis of ethical statutes should not be for "loopholes" or "technicalities" by which one can take advantage of government, the public, or other interested parties. If your analysis requires that you find a "loophole," within Idaho's ethical statutes, then your conduct is likely unethical. Ethics for public officials is also tricky for another reason. Within public service, there are often two courts: the traditional legal system, and the court of public opinion. A win in one does not guarantee a win in the other. When determining the proper answer to any ethics determination, a public official should be mindful of the impact his decision may have both legally and publicly. Public officials, by the trusteeship given them by the electorate, are held to a higher ethical standard. PUBLIC EMPLOYEES OR OFFICIALS COVERED BY ETHICS STATUTES Question No. 3: Who is subject to Idaho Code §§ 18-1351 et seq., the Bribery and Corrupt Influence statutes? Answer: Idaho Code §§ 18-1351, et seq,. regulate the conduct of public servants in the areas of bribery and corrupt practices, including conflicts of interest and nepotism. Unless otherwise stated, these statutes apply to all "public servants," which is defined to mean: "any officer or employee of government, including legislators and judges, and any person participating as juror, advisor, consultant or otherwise, in performing a governmental function; but the term does not include witnesses." Question No. 4: Who is subject to chapter 7 of title 59, the Ethics in Government Act? Answer: All "public officials" are subject to the Ethics in Government Act. "Public official" means any person holding public office in the following capacity: (a) As an elected public official meaning any person holding public office of a governmental entity by virtue of an elected process, including persons appointed to a vacant elected office of a governmental entity, excluding members of the judiciary; or 14 • Idaho Ethics In Government No person related to a county commissioner by blood or marriage within the second degree shall be appointed to any clerkship, office, position, employment or duty with the commissioner's county when the salary, wages, pay or compensation of such appointee or employee is to be paid out of public funds. The commissioner's son/daughter-in-law is clearly related by marriage within the second degree, and will be compensated for the performance of his/her duties. The county would be prohibited from hiring the commissioner's son/daughter-in-law. CONFLICTS OF INTEREST/PROHIBITED CONTRACTS Question No. 10: What action is required under chapter 7 of title 59, Idaho Code, the Ethics in Government Act, if a conflict of interest exists? Answer: The Ethics in Government Act requires certain action when a conflict of interest exists. A conflict of interest is generally defined as any "official action or any decision or recommendation by a person acting in a capacity as a public official, the effect of which would be to the private pecuniary benefit of the person or a member of the person's household, or a business with which the person or a member of the person's household is associated." When a conflict of interest exists, the public official must disclose the conflict. Under the Ethics in Government Act, disclosure does not affect an elected public official's authority to be counted for the purpose of determining a quorum and to debate and to vote on the matter. The public official may seek legal advice on whether a conflict of interest exists. If the legal advice is that a real or potential conflict may exist, generally, the public official must prepaze a written statement describing the matter required to be acted upon and the nature of the potential conflict, and shall file such statement with the entity set forth in the statute pertaining to the appropriate elected or appointed office. Disclosure of the conflict or consultation with counsel satisfies the requirements of the Ethics in Government Act. It does not, however, permit the public official to engage in acts prohibited by other provisions of the Idaho Code. Question No. 11: Are there exceptions to the definition of conflict of interest in chapter 7 of title 59, Idaho Code, the Ethics in Government Act? Answer: Yes. Under the Act, there is no conflict of interest if the pecuniary benefit received arises out of: (a) An interest or membership in a particular business, industry, occupation or class required by law as a prerequisite to the holding by the person of the office or position; (b) Any action in the person's official capacity which would affect to the same degree a class consisting of an industry or occupation group in which the person, or a member of the person's household or business with which the person is associated, is a member or is engaged; (c) Any interest which the person has by virtue of his profession, trade or occupation where his interest would be affected to the same degree as that of a substantial group or class of others similarly engaged in the profession, trade or occupation; (d) Any action by a public official upon any revenue measure, any appropriation measure or any measure imposing a tax, when similarly situated members of the general public are affected by the outcome of the action in a substantially similar manner and degree. Question No. 12: What is the effect on a contract entered into in violation of the conflict of interest provisions of Idaho law? 16 Idaho Ethics In Government Answer: The answer depends upon the specific statute and how the courts may have interpreted that statute. Violations of Idaho Code § 59-201 are voidable by any party, except the interested official, but not void from the beginning. Idaho Code § 59-203. However, violations of other ethics statutes may cause the contract to be void. For instance, in Independent School Dist. No. 5 v. Collins, 15 Idaho 535, 98 P. 857 (1908), the court addressed violations of Idaho Code § 33- 507, stating: [S]uch contracts are absolutely void. If money is illegally paid on such void contract, the district may recover it back, and in case the district refuses to do so, any taxpayer of the district may, for and on behalf of the district, maintain an action for the recovery of the money so illegally paid. 15 Idaho at 541. In any contract or transaction entered into which is ruled void, the public official would be required to refund any money he/she receives pursuant to a contract or transaction with the board. Such a challenge could be initiated by the board or by a taxpayer within the respective governmental entity. Question No. 13: May the employer of a city council member contract with the city? Answer: The answer is "yes," under certain circumstances, such as when an interest is defined to be remote under Idaho Code § 59-201 A and, therefore, not a conflict of interest. "Remote interest" means: (a) That of anon-salaried officer of a nonprofit corporation; or (b) That of an employee or agent of a contracting party where the compensation of such employee or agent consists entirely of fixed wages or salary; or (c) That of a landlord or tenant of a contracting party; or (d) That of a holder of less than one percent (1 %) of the shares of a corporation or cooperative that is a contracting party. However, even if the interest is remote, the public official must disclose the remote interest prior to the formation of the contract, and the governing body must approve the contract on a vote sufficient for that purpose without counting the vote of the officer having the remote interest. Furthermore, the public off cial cannot attempt to influence another officer of the board of which he is an officer to enter into the contract. Question No. 14: Are there any circumstances where a public official can personally contract with a board of which he or she is a member? Answer: In rare circumstances a public official can contract directly with the board of which he/she is a member whether or not he or she is an elected or appointed public official. Under Idaho Code § 18-1361, a public official or his/her relatives can contract with the board if: (1) The contract is competitively bid and the public servant or his/her relative submits the low bid; and (2) Neither the public servant nor his/her relative takes any part in the preparation of the contract or bid specifications, and the public servant takes no part in voting on or approving the contract or bid specifications; and (3) The public servant makes full disclosure, in writing, to all members of the governing body, council or board of said public body of his/her interest or that of his/her relative and of his or his relative's intention to bid on the contract; and (4) Neither the public servant nor his/her relative has violated any provision of Idaho law pertaining to competitive bidding or improper solicitation of business. 17 Idaho Ethics In Government Question No. 15: May a school district conduct business with a business establishment whose owner is a spouse of a school board trustee? Answer: Idaho has along-standing tradition of forbidding school board trustees from doing any business with or receiving any pecuniary benefit from the district they serve. Idaho Code § 33-507 states in relevant part: It shall be unlawful for any trustee to have pecuniary interest, directly or indirectly, in any contract or other transaction pertaining to the maintenance or conduct of the school district, or to accept any reward or compensation for services rendered as a trustee except as may be otherwise provided in this section. (Emphasis added.) Purchases by the district of material from an establishment owned by the spouse of a school board trustee provide a direct or indirect pecuniary benefit to the member of the school board. The school board trustee would certainly benefit from any transactions between the district and the business establishment. Even if there is not a written contract between the business establishment and the district, it does not take the situation outside the reach of Idaho Code § 33-507. There would still be a contractual relationship between the business and the district. Moreover, the contract would be void. Idaho Code § 33-2106 incorporates Idaho Code § 33-507 and makes the limitations on the authority of school district trustees applicable to trustees of junior college districts. Question No. 16: May a county employee purchase property that the county has for sale? Answer: There is no express prohibition against a county employee purchasing county property, unless that individual is a county commissioner or other officer. See Idaho Code §§ 31-807A and 59-202. This rule applies to county employees generally. Sheriffs' deputies selling property at sheriffs' sales are prohibited from participating in the sale. BRIBERY/CORRUPT INFLUENCE & GIFTS TO PUBLIC OFFICIALS Question No. 17: Would a regional tour sponsored by a chamber of commerce to acquaint legislators with a region of the state, provided without chazge to every member of the Idaho Legislature, violate the Bribery and Corrupt Influence Act? officials: Answer: Idaho Code § 18-1356 regulates gifts to public servants. Subsection (4) relates to legislative No legislator or public servant employed by the legislature or by any committee or agency thereof shall solicit, accept or agree to accept any pecuniary benefit in return for action on a bill, legislation, proceeding or official transaction from any person known to be interested in a bill, legislation, official transaction or proceeding, pending or contemplated before the legislature or any committee or agency thereof. (Emphasis added.) There have been no allegations, nor has it ever been suggested, that the efforts of the members of the chamber of commerce are made in return for legislative action on their behalf. Therefore, the tour in general does not violate Idaho Code § 18-1356(4). Consideration must also be given to Idaho Code § 18-1359(1)(a), which provides: No public servant shall: (a) Without the specific authorization of the governmental entity for which he serves, use public funds or property to obtain a pecuniary benef t for himself. 18 • • Idaho Ethics In Government It is the opinion of the Attorney General's Office that the legislature, by enacting Idaho Code § 18-1359(1)(a), did not intend to prohibit and criminalize participation in activities such as this tour. The combination of official business with conferences and social activities is a fact of modern life, and it is the opinion of this office that the legislature did not intend to eliminate that reality. This tour is a legitimate function of the legislature, and the expenses associated with the tour, if submitted on a voucher, could be financed by the state. As such, they are clearly not pecuniary benef is inuring to the legislators' personal or private benefit. Question No. 18: Would a business trip by legislators for the purpose of viewing demonstrations of a product purchased by the state, in which airfare, food and lodging were paid for by the vendor, but not entertainment events, violate either the Ethics in Government Act or the Bribery and Corrupt Influences Act? Answer: Idaho Code § 59-703, the Ethics in Government Act, is "directed primarily towards improper activities of public officials in the course of their official duties." In this case it is apparent that the public officials would derive some pecuniary benefit from the trip. However, the pecuniary benefit does not appear "personal" in nature because the trip is for business purposes only, without any entertainment or personal activities on the agenda. The facts do not reveal that any "official action or any decision or recommendation" has been made by the public off cials to the benefit of the company sponsoring the trip. The trip does not relate to any upcoming bidding or contracting process in which the company stands to gain or lose. The trip does not seem to violate the Ethics in Government Act. Idaho Code § 18-1359(1)(a) is also not an issue in this case. The officials are acting strictly in their official capacity, there will be no private or personal gain in the form of entertainment or other purely personal activities, and the business trip appears to be directed solely at a legitimate legislative function--gathering technical information relevant to the state's interest in a product. This type of informational business trip does not call into question the type of private pecuniary gain or official action in return for such gain which Idaho's ethics laws clearly and strongly outlaw. The trip would not violate either the Ethics in Government Act or the Bribery and Corrupt Influences Act. Question No. 19: Can members of the Idaho Legislature accept gift packs from a marketing association in the state of Idaho in which the products are intended to promote the variety and quality of merchandise produced in Idaho? Answer:According to Idaho Code § 59-703(4), a conflict of interest occurs when a legislative official takes official action or makes an official decision or recommendation, the effect being to the "private pecuniary benefit" of such person, the person's household or business. Based on the facts in this case, it is difficult to foresee any legislator having a conflict of interest resulting from the acceptance of one of the complimentary gift packs. A conflict of interest requires some official action by the legislator. From the facts presented in this case, there is no indication the receipt of the gift pack was the result of any official action, decision or recommendation taken or proposed by any legislator. Mere acceptance of the gift pack does not violate the provisions of Idaho Code § 18- 1359(1)(b). In addition, under Idaho Code § 18-1359(1)(b), trivial gifts or benefits, which do not exceed $50.00 in value, are not prohibited if they are incidental to personal, professional or business contacts and do not affect official impartiality. Question No. 20:If a major corporate officer of a firm which performs a great deal of work for one of the state departments should become a member of the Idaho Legislature, would there be any possibility of a "conflict of interest" arising out of his holding public office and voting on appropriations while continuing to be a corporate officer of a private firm? Answer:Yes. Idaho Code § 59-201, provides: Members of the legislature, state, county, city, district and precinct officers, must not be interested in any contract made by them in their official capacity, or by any body or board of which they are members. 19 • Idaho Ethics In Government In addition to constitutional and statutory provisions, the rules of the senate or house of representatives may require that members declare their interest or abstain from voting in cases involving conflicting personal and public interests. Similarly, Idaho Constitution art. 3, § 9, provides in pertinent part: Each house when assembled shall choose its own officers; judges of the election, qualifications and returns of its own members, determine its own rules of proceeding, and sit upon its own adjournments; .. . INCOMPATIBILITY OF OFFICE Question No. 21: May an individual serve in the Idaho Legislature and as the mayor of a municipality at the same time? Answer:Idaho has no constitutional or statutory provisions prohibiting a state legislator from concurrently holding another public office. However, the common law doctrine of incompatibility of office should be examined. The common law doctrine of incompatibility as it relates to one person holding two public offices is based upon the public policy that public service requires the discharge of official duties with undivided loyalty. In the question presented, the two positions are not incompatible. The office of mayor is wholly independent from the state legislature and cannot in any sense be viewed as subordinate. The duties of the mayor do not conflict or clash with the duties of a state legislator. Finally, it has been suggested that holding dual offices violates the distribution of powers clause of Idaho Constitution art. 2, § 1. This section provides: The powers of the government of this state are divided into three distinct departments, the legislative, executive and judicial; and no person or collection of persons charged with the exercise of powers properly belonging to one of these departments shall exercise any powers properly belonging to either of the others, except as in this constitution expressly directed or permitted. In relation to the separation of powers between state and local governments (prohibiting a person from serving in an executive capacity on the local level and as a legislator in the state government), this office has been unable to find any authority indicating that the doctrine has any application. The fact that a state legislator is also a municipal executive officer does not in any sense impinge or intrude upon the authority of the state judicial or executive branches. Similarly, the fact that a city mayor is also a state legislator does not intrude upon the authority of the respective city council. Thus, holding dual public offices, one municipal and one state, does not violate art. 2, § 1 of the Idaho Constitution. This office can fmd no statutory or common law prohibition preventing a city mayor from serving in the Idaho Legislature. Question No. 22: May a member of a county planning and zoning commission serve as a city councilman without creating a conflict of interest? Answer:The Local Planning Act contains a conflict of interest provision: A member or employee of a governing board, commission, or joint commission shall not participate in any proceeding or action when the member or employee or his employer, business partner, business(,) associate, or any person related to him by affinity or consanguinity within the second degree has an economic interest in the procedure or action. 20 • • Idaho Ethics In Government Idaho Code § 67-6506. Because a city council member is an agent of the city he/she represents, this section would probably prevent him/her from participating in any county zoning decisions that may affect the city's economic interests. However, there is no provision requiring the council member to resign his/her position. There is also present a question of incompatibility of office. The common law doctrine applies if there is a potential conflict between the two offices such that one individual could not give absolute allegiance to both offices. Incompatibility is most often found where one office supervises the other or when the interests of the two offices are antagonistic to each other. 3 McQuillin on Municipal Corporations, §§ 12.66 et seq. In the area of zoning, the interests of the county and the city may frequently be at odds, and it is not uncommon for cities and counties to sue one another over zoning disputes. Under such circumstances one person could not fill both offices without a conflict of loyalty. If two offices are incompatible, one office should be vacated. The Attorney General's Office recommends that one office be vacated to eliminate the incompatibility problem. Question No. 23:May a person serve as a chairman of a county political party and as a member of the Idaho State board of Correction? Answer:It appeazs that a person cannot serve as chairman of a county political party and retain a position on the board of correction. Idaho Code § 20-204 provides: The members of the boazd of correction and its officers and employees shall not, at any time of appointment nor during their incumbency of office, serve as the representative, officer, or employee of any political party. The language of this code section is clear and unambiguous. An individual cannot serve as a representative, officer or employee of a political party and also serve on the state boazd of correction. 21 u Idaho Ethics In Government CONSANGUINITY CHART 4 Great Grand UnclelAunt 3 3 hild of Great Great Uncle/ Uncle/Aunt Aunt ~" 2 2 Second Cousin Uncle/Aunt Cousin sin3s Ghild~~NephewlNiecel~ Sibling Grand phewlNiece • 4 Great Great Grandparent 3 Great Grandparent r 2 Grandparent 1 Parent 1 Person'A' 1 Child 2 Grandchild 3 Great Grandchild 22 • Idaho Ethics In Government INDEX OF ADDITIONAL CONFLICTS OF INTEREST STATUTES Idaho Code § 16-106 Duties of coordinating council. Idaho Code § 19-871 Appointment of additional counsel. Idaho Code § 19-5109 Powers of the council -- Standards of training, education and employment of peace officers -- Certification -- Penalties. Idaho Code § 20-236 Board of Corrections -- Members or employees of board not to be interested in contracts. Idaho Code § 20-804 Authority of county or city to house prisoners in a private prison facility. Idaho Code § 22-436 Seed arbitration. Idaho Code § 23-211 Liquor Dispensary -- Personnel not be to interested in private liquor traffic. Idaho Code § 30-1450A Department of Finance -- disclosure of relationships with licensed persons or qualified organizations. Idaho Code § 31-807A County Commissioners -- Purchase and Sale of County Property. Idaho Code § 31-2606 Prosecuting Attorneys -- Prohibited Acts. Idaho Code § 31-2806 Coroner to act as substitute for sheriff. Idaho Code § 31-4905 Conflict of interest prohibited. Idaho Code § 33-1208 Revocation, suspension or denial of certificate -- rounds. Idaho Code § 33-1254 Professional codes and standards -- Adoption -- Publication. Idaho Code § 31-4505 County Commissioner -- Pollution Control Financing. Idaho Code § 31-4905 Regional Disposal Districts -- District Board. Idaho Code § 33-2106 Junior Colleges, Trustees of Junior College Districts. Idaho Code § 33-2120 Junior Colleges -- Dormitory Housing Projects. Idaho Code § 33-3004 Idaho State University. Idaho Code § 33-3403 Idaho School for the Deaf and Blind. Idaho Code § 39-1328 Organization of board -- Seal -- Duties of treasurer -- Compensation of members -- Financial statement. Idaho Code § 39-1446 Organization meeting -Chairman -- Executive director -- Surety bond and conflict of interest. Idaho Code § 39-5603 Standards for provision of personal assistance services. Idaho Code § 39-6412 Organization. Idaho Code § 39-6607 Organization. 23 • Idaho Ethics In Government Idaho Code § 39-7408B Site review panels -- Members, chairman, quorum, meetings, staff. Idaho Code § 39-7908 Site review panels established. Idaho Code § 40-409 Turnpikes. Idaho Code § 40-612 County Commissioners--Commissioner not to have interest in highway contracts. Idaho Code § 41-208 Department of Insurance -- Director. Idaho Code § 41-4937 Petroleum clean water trust fund -- Plan Management. Idaho Code § 42-1757 Water Resource Board. Idaho Code § 42-3209 Organization of board -- Accounts of treasurer -- Compensation of members -- Annual audit -- Removal of directors. Idaho Code § 42-5227 Ground Water Districts--Directors and Officers. Idaho Code § 43-320 Irrigation Districts--Directors and Officers. Idaho Code § 50-2017 Municipal Corporations--Urban Renewal. Idaho Code § 50-2705 Municipal Corporations -- Industrial development program. Idaho Code § 54-829 Board of Cosmetology -- Affiliations of members wit schools of cosmetology or company selling cosmetic supplies. Idaho Code § 54-909 Board of Dentistry. Idaho Code § 54-1202 Idaho Code § 54-1525 Idaho Code § 54-1720 Idaho Code § 54-1806A Idaho Code § 61-207 Idaho Code § 63-3802 Idaho Code § 66-119 Idaho Code § 67-1406 Idaho Code § 67-4713 Definitions. Optometrists--Referrals by optical firms prohibited. Other duties -- Powers -- Authority. Board of Profession Discipline--physicians and surgeons. Public Utilities Commission. Members. Department of Health and Welfare--State Hospitals. Employment of attorneys restricted -- Exemptions. Department ofCommerce--Travel and Convention Industry Council Idaho Code § 67-4909 Organization of board -- Accounts of treasurer -- Compensation of members -- Annual audit -- Removal of directors. Idaho Code § 67-5252 Presiding officer -- Disqualification. Idaho Code § 67-5726 Prohibitions. 24 • Idaho Ethics In Government Idaho Code § 67-6221 Housing and Finance Association. Idaho Code § 67-6407 Conflict of interest. Idaho Code § 67-6506 Conflict of interest prohibited. Idaho Code § 67-7405 Commission -Appointment -- Chairman. Idaho Code § 67-7443 Conflict of interest. Idaho Code § 67-7704 Bingo-Raffle advisory board -- Members -- Appointment -- Qualifications. Idaho Code § 68-108 Power of court to permit deviation or to approve transactions involving conflict of interest. Idaho Code § 70-1410 Port Districts Idaho Code § 70-2105 Port Districts--Economic Development Financing Act 25 ~1~ 1Pos~ fir' ~c~~ ~ c1L~Cs~ -T~Lg~r~.~'-mil ~~ ~~" MayorTammy de Weerd City Council Members: E IDIAN*.~-- Keith Bird Joe Borton Charles Rountree ®~ ~ ® David Zaremba NOTICE OF SPECIAL MEETfNG /WORKSHOP MERIDIAN CITY COUNCIL NOTICE IS HEREBY GIVEN that the City Council of the City of Meridian will hold a Special Meeting /Workshop in the City Council Chambers at Meridian City Hall, 33 East Idaho Avenue, Meridian, Idaho., on Monday, July 14th, 2008 at 1:00 pm. The Meridian City Council will be discussing the following agenda items: Presentations and Discussions of the Proposed Enterprise Fund Budget (approximate times): 1:00 pm Introduction /Preparations 1:15 pm Enterprise Fund 5:00 pm Council Budget Decisions The public is welcome to attend. DATED this 10th day of July, 2008. ~'' YCEE L. HOLMAN - Li \\„~ ~ ~, ~~l 11Q,,~,11 d ': tea SISAL - ,~~ o :' r ts'~ • ~~~ ,,.~ .~ ,,,~~ ~11N7'r , \\~,,~ /~~/ll ~l1lf~l1 \1\1\\\ Meridian Gity Council' SpecialVNo~kshop /Meeting -July 14, 2008 AIF materials presented at. public meetings shall become property of the City of Meridian. Anyone desmng a~comrrrodation for disabilities related to documents and/or hearings, please contaEtahe GitjtGlerk-sC3ffrce at 888-4433 at least 48 hours prior to the public meeting. i • ~' 1 J ~1'r~l ~.~ , ~~ FY09 Enterprise Fund Budget Presentaction .~t~ i~ coos r ~/ ua.ro ; ~1'~J~~JI~K~ Mayor Tammy de Weerd Council Pres. Charlie Rountree Stacy Kiichenmann Todd Lavoie Reta Cunningham Becky Licari Karie Glenn Bob Reid Clint Dolsby Kyle Radek Rick Ciinton Tracy Crane Ed Squires ~ • • Agenda - General Departmental Information - Who we are - What we do - Who we serve - FY08 .Dept. Accomplishments - What we've done - Enterprise Fund Status: Trending & Stats - Where we are: Current Status - Where we've been: History - Fund Administration - How we are doing - Review of administration practices - Findings - Recommendations - FY09 Budget - What we need - Base - Enhancements CCf' IE'~°1O'^r'~- wcue Agenda (Cont.- - Future Needs and Projections - What we expect Intermission - Utility Rate History - Where we've been - Rate Model Results - What we should think about - Assumptions and approach - Scenarios - Regional benchmarks - Summary - Conclusion - Q8~A ~iri roeR inNy~ weuo morb nep.rtm.vc 2 • • Public Works General Departmental Information Lj11 E[~iDIAN¢- vonuo~/ Demographic Enterprise Fund Employees by Division 6 Employee 7% 28% 24 Employees 32 Employees 36°/n n 27% Public Works ®Water O Wastewater ^ MUBS (~EIZIDIAN¢- r°nuo mo.bneP:.rtmenc 3 • a • s~ {Enterprise_.~ Fundy Fun~ct~o 4 _ ~~ 1 l 1 ~ ~~ ~ ~ _ ~ ~ z ~ -~. '` ~- N E IDiZ IAN; 1IDA£i0 / 1~ IN~E ~/ ' S New ° _ 1 Well ~ 8 Miles of Water Lines 7 Miles of Sewer Lines 5 New PRV Stations 928 Residential Accounts 120 Commercial Accounts i " ~ J 42 Sprinkler Accounts I ,~- l tl ~ ~ i] X S ~ ~ ~ ,i _ - 388 Miles of Water ~ ~- 1 Booster Station ~~~` ~ = ~-- -~ _~ ~ ~ ~ ~- ;I _ ~ 15 PRV Stations , ~~ ~ ` 18 Wel Is _ __ 23,892 Accounts ~ ~ ~ 492 Miles of Sewer ~ ~ - _t~ 10 Lift Stations i ` ` '- ~ - ~ ~ r 9,000+ Manholes _ ~., ~ 6.9 m d Max .Flow ~~~ - ~---- 4 • Public Works FYO8 Accomp tishments ~,~v~.ERIDIAN~ wnuo ~JJ worts nepenmeni Public Worlcs Accomplishments - Updated Water and Sewer Models - Completed Phases 4A, 4B & 4C of the Black Cat Sewer Project - Implemented process changes for coordinating stubs and services for property owners which has resulted in a savings of over $100K. - Developed., presented, and implemented innovative flood hazard .prevention ordinance -changes that make Meridian a leader in floodplain administration in the Treasure Valley. - Completed $1.5 M in water and sewer construction in coordination with ACRD projects. ~E~Nr Pot„ 5 • • Water Divisi®n Accomplishmen#s -Zero positive bacteria samples for the 7th consecutive year -Constructed 5 new PRV Stations Installed SCADA telemetry systems at 4 PRVs for improved monitoring and coordination (bringing the total to 13) -Completed the drilling of Well #27 -Significantly reduced brown water calls- from 297 in 2007, to only 57 so far in 2008 . - Improved our safety program through training and employee awareness -Completed construction of a new office/shop building.. Ribbon cutting and open house held in December'07 - Increased meters equipped with "radio read" to 40% of total in system. 99 % of commercial meters are now converted to radio read c4f~~~ Water Divisi®n Accomplishments Lanark -Commercial Water Connection ~ Bower Street Extension F_, ~ _ .. ~. ~ ~~ s~ ~ ~_ ~ ,, 4 t ;' t ,1C _...iY]4'ri ,_.._ .~_°.'.'~,.--..v--.x_.'11 Connections through UPRR and JSD property and upsizing the Bower Street main provides more robust fire flow to commercial areas. Fire flow amounts improved by 10-25%. Cost: $106K and $36K. may` ERIDIANq- weuo ~J mc.ts uew.eme. 6 • Water Division Accomplishmen#s Black Cat Water Main 's y~-=e- `~'~ ~ 1_ ~s_. I ~` ~ i~ Project included 9,000 _ ~ `~~ linear feet of 12-inch ' ~~ , ~ waterline into northwest ~' Meridian to serve future ~_~ P develo ment ?~ Cost: $755K. ~~" ~- ~ ' -~ GCf ~ is~~ wnu. voxk. Depvem.nt Waste Water Divisi®n Accomplishments - 1St Municipal Class A Reclaimed Water Permit in Idaho - Completed third bank of ultraviolet disinfection - North Black Cat Lift Station (60% complete) - Wastewater Treatment .Expansion Liquid Phase Project (substantially complete) - Biosolids Improvement Project (90% complete) - Facility Plan accepted and approved by DEQ - Completed Aquadiamond Tertiary Filter - Designing cloth disk filters to provide redundancy for filtration and wastewater reuse. - Wastewater Pretreatment Program submitted to EPA for review and approval c~C~~," Works Deps`Imevt 4 7 • • i Waste Water Division Accomplishments Wastewater Treatment Plant Liquids Stream Expansion This Project includes the addition of two Aeration Basins, Primary Clarifier and Secondary Clarifier with modifications to the existing processes for $8,367,500. This project is substantially complete and has increased liquid stream rate capacity by 65%. :. --- ~s t` ~ ---'~'~t'~i' a.~. ~:=. ~'.. Waste Water Division Accomplishments Wastewater Treatment Plant Biosolids Improvement Project This Project includes the addition of two Digesters, control building and a centrifuge with modifications to the existing processes for $10,314,000. Start-up anticipated in August 2008. _; ;~ i~ ~' ~ '~~"- -r ' ~ r ~ ''~ t ~;~=~ .'1 r~~ ~~ I '~ j-~ ~~ ~ ~ ~ ~~~ ~~~,,,;;;nnn f ~~~ ~ si ~ ' i ~ ,r~ 8 • Waste Water Division Accomplishments North Black Cat Lift Station This Project includes construction of a site built, cast-in-place concrete sewage lift station, building,, site excavation, shoring, dewatering, yard piping, exposed interior piping, fittings, valuing, and three(3) 40 Hp non-clog centrifugal sewage pumps . ~ u _. ~ ...,. ,p.T ~ ~, ~' ~ ~ ~r~--~.~r ~ - _ .. L~ ... ~- Waste Water Division Wastewater Flows s.5 - :calibrated s.o Effluent „„° . I - E 5 5 Flow Meter I . _ I i L - - - - . T a.s ~.___ _._ 0 4.0 I I I ~ ~ 3.5 I i ~ 3.0 2.5 2:0 J F M A M J J A S O N~ D Month - 1997 ~-1998 -1-1999 -31r 2000 2007 -~ 2002 f 2003 ~- 2004 -2005 ~-2006 -+-2007 -~2008Projected may` EI~roIANr wnu~ ~i mo.k.ueoe~wa~ 9 i • • G1S Division Accomplishments Completed - Converted Water Model into GIS to allow for enhanced upkeep and visualization - Created direct link from GIS to digital record drawings for ease of information lookup - Created a direct link from valves in GIS to valve maintenance records - Expanded the number of GIS users in Water, Wastewater, Engineering and Development Services. Upcoming - Will convert the Sewer Model into GIS to allow for enhanced upkeep and visualization - We will enhance our updating and accuracy processes - We will further expand our user count - Increase training of GIS Users - Create a data layer of all past city projects with links to Digital Record Drawings .GIS Division Accomplishment GIS Field Measuring Capabilities ~- .-. _r_ a ...-.. ~~ _ ..rte. ~~ °....,~ ~~ ~ ~ n....~a ,~ ~ _.r.a {; ~,: ~_ l~M IEEE DIANy- ranu moha Deputment 10 • ~ • Enterprise Fund Status weu~ 11 v • • /~ Fund Statute ~~ ~~ ~~~~~~ ~" Fund 60 Fund 62 (J ~ Enterprise Latecomers Total Unrestricted Fund Balance @ 9130107 $29,500,907 $7,404,892 $36,905,799 Budgeted Capital Carry forwaM $18,532,919 $0 $18,532,919 Net Beginning FY08 Fund Balance $10,967,988 $7,404,892 $18,372,880 Fiscal Year 2008 Budgeted Revenue $18,276,725 $600,000 $18,876,725 Assessment Revenue Shortfall -$2,440,000 -$2,440,000' Fiscal Year 2008 Budgeted Expenses $17,974;047 $600,000 $18,574,047 Depreciation $3,000,000 $3,000,000 FY08 Net Change to Fund Balance -$5,137,322 $0 -$5,137,322 Net Projected Fund Balance@ 9130/06 $5,830,666 $7,404,892 $13,235,558 Total Amendments $5,429,990 $3,700,000 $9,129,990 Net FY08 YE Fund Bal after Amendments ~ $400;676. $3;704;892 $4,105,568 Reclassification of Capital Projects $6,060,264 $6,060,264 6 months of Oper. and Person Exp. -$4;000,000 -$4,000,000 Net FY06 YE Fund Bal after Op Reserves $2;460;940 $3;704,892 $6,165,832 C`~C ~J wnu~ mo.t. uep.,wan~ Enterprise Func! History Total Revenue Over Time szs,ooo,ooo -~ - --~ s~o,ooo,ooo s~s,ooo,ooo sio;aoo,ooo ss,ooo;ooo so FY02 FY03 FY04 FY05 FY06 FY07 ~w~nuo \~ mo.t. nev.~weoe 12 ~ • Enterprise Fund History . Monthly Usage Pe r Customer 1 s;ooo 1 a,ooo 12,000 c -° 10,000 u 8;000 6,000 4,000 Water Wastewate mo.k. oeP~meoc Enterprise Fund History/ Revenue Per Customer $zao.oo $2so.oo $2ao.oo $220.00 $zoo.oo $160.00 $1so.oo . $1ao.oo Water Wastewater C~ m Publle Woke Dapartmeot 13 - - - Water ^ Wastewater ~ 2002 2003 2004 2005 2006 2007 15,396 12,721 11,266 9,098 9;595 10,238 5,551 6,267 5;664 4,926 5,068 5,332 r -*- Water f Wastewater 2001 2002 2003 2004 2005 2006 2007 $238.29 $222.81 $991.36 $174.25 $153.35 $159.38 $173.76 $222.92 $234.03 $257.90 $238.46 $220.06 $224.96 $243.11 Enterprise Fund. History- ~F~~ppCmm;~~~~~ Poblle mocks DepeRmeot Enterprise Fund History Capital Construction Expenses -- szs;ooo,ooo -- s2o;oo0,000 sls,ooo,ooo slo;ooo;ooo ss,ooo;ooo so 1999 2000 2001 2002 2003 2004 2005 2006 2007 C~i~ roER inNC~ a.~nuo mu.k. nev.~weo~ 14 Enterprise Funci H istor~ Total Revenues vs Total Expenses ~ _ r02 FY03 FY04 FY05 FY06 FY u~ ~::% mo.t. n,P..weoc $35,000,000 '$30,000,000 $25,000,000 $20,000;000 $15,000,000 $10,000,000 $5,000,000 $0 Enterprise Funs! His#ory Change in Cash Position Over Time $4,000,000 $z,ooo,ooo ~ $939,724 $2,667,658 $388, -$z,ooo,ooo -$a,ooo;ooo $1,790,351 -$s,ooo,ooo $5,49 '89'f -$e,ooo,ooo -$10;000;000 -$az,ooo,ooo -$14,000,000 - 15 1 ~ 0,149 -$1s.ooo;ooo -$1a;ooo;ooo FY02 FY03 FY04 FY05 FY06 FY07 ~~ ~\_J mom nepartmecc I 15 ~~. Enterprise Fund History Enterprise Fund Balance History $as,ooo,ooo---- ------- $35,000,000 - -- -- -- --- - --- -- $25,000,000 - - - $20,000.000 ...._._.__ .-_... ...._ ............ ._....-- ----- ------. ...__._...- ----.. ......_..._ ...._.... Incl. $15.000,000 -- -- --- ---- -- -Res'- $10,000,000 -............_. ......__....... ------._ _.........._. $10.2M -noRes.~~~...---.... $5,000,000 .......__.._.. .._.....--- ........_...._. ._...._...._.56.,.2.Ms wlEh_Res...~~:.:.... _..._... $0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 ~J mom nev.nmen: Enterprise Fund mom nevyweot Fund Administration Study 16 a u • Enterprise Fund Review -3-Month Review of Enterprise Fund Administration -PW & Finance Staff Review - Looked at: -Fund History -Reporting -Cash Flow -Operational Coverage -Capital Coverage -Capital Project Financing -Debt Coverage -Reserve Capabilities -Did Not Review Developer Assessments csT'~ Enterprise Fund Review Results -Observation 1: Fiscal Reporting & Accountability - Water and Sewer revenues and expenses are difficult to track independently - Difficult to identify cash position and solvency of each Utility - Improve fiscal controls of each Utility's expenses - Improve allocation of funding -Recominendations: - Strengthen fund reporting and reconciliation of fund activity - Utilize cash position for solvency - Stick to budgets - Improve Project Estimating - Identify a PW budget gatekeeper - Budget Amendment Accountability - Encumber Funds ~E~„~,,~, weuo 17 i Enterprise Fund Review Results -Observation 2: Capital Planning and Financing Near term financing emphasis and planning horizon - Limits financing options - Full request budgeting unnecessarily strains budget - No inflationary adjustments utilized -Recommendations: - Better anticipate and quantify capital needs - Develop longer-term infrastructure and capital plans - Program inflationary costs - Utilize a "Just in Time" Capital Financing Strategy Current Financing Strategv Example: 2009 Water Reservoir $2,225,000 Plant Expansion $9,100,00 Annual Request $11,325,000 "JIT" Financing Strategv Example: 2009 2010 2011 2012 Project Total $125,000 $350,000 $1.,750,000 $2,225,000 $275,000 $575,000 $3,500,000 $4,750,000 $9,100,00 $400,000 $925,000 $5,250,000 $4,750;000 $11,325,000 Enterprise Fund Review Results -Observation.3: Capital Financing A Capital financing is developer driven - Capital infrastructure is developer driven; capital infrastructure lacking in some growth priority areas - Construction of capital infrastructure improvements largely by development community - No rate-funded revenue stream for capital infrastructure - Current capital financing not adequate to meet future capital investment needs - Very limited debt coverage capability -Recommendations: - Develop an additional dedicated CIP Revenue Stream financed from rates -Positions Utility to take on debt -Allows debt coverage ~Cp7~{~_ hblle 18 • Enterprise Fund Revd ew Res u I#s -Observation 4: Reserve Accounts - No operational reserve - No depreciation reserve - No capital reserve -Recommendations: - Establish and set aside a 6-month operating reserve for both the Water and Wastewater Utility = $4M total - Establish and set aside a dedicated and compounding depreciation reserve that grows over time - Establish a capital reserve -Could use EFB as alternative c4~E`V" mmka Deputmei Enterprise Fund Review Results -Observation 5: Anticipatory Planning and Budgeting - Revitalization - Plant Upgrades and Expansions - Regulatory Compliance -Recommendations: - Adjust capital planning and financing strategies to accommodate anticipated needs . C~E[ZIDIANg- roem moh, ne~.we. 19 • Enterprise Fund FY09 Base Budget LjV~.ERIDIAN~ roeuo mo.t, nev..~e, ~wnu~ ~% mmb nepuemei 20 ~jV{ `E` °t IAN ronu~ Personnel 8c Operational Costs Increo ase $7,000,000 - ---...- ----- --- ---. ..._._........ o......__... ---......... 6.0./0 _ _. p 2008 Reduction 000 000 $6 -... -_ - ------... . _..... _ ... ........... _ _. , , p 2009 r ~ - - $5,000,000 -- ---- ---- $4, 000, 000 4.9% - $3,000,000 ------ ---- -Reduction____ _ $2,000,000 -1..80- - ~ _ Reduction - - $1,000,000 -r~l -- ~ - - $0 Utility Billing Public Works Water Wast ewater C~EIZIDIAN~ wu0~ mo.c. OeP,~weoi 21 o ® ^ o ^ o '• Enterprise Fund Capita i Replacements ~E Iii DiAN}- vocuo mo.t. oey.xme~ Capital Replacement R ests ~% wo.~ oev.rtm~o~ ...._ _.. _.._.._-.__......... _............. ~ Personneli0 eratin s. Ex nse i Ca ital i eau: Total .CAPITAL REPLACEMENTS MUBS Com uter- 1548 1,450 1,450 MUGS G400 - Re lacement Furniture 2,975 2,975 PW Notebook Com uter - Y313 1,950 1,950 PW Corn uter-1334 1,450 1,450 PVN Com uter- 1335 1,450 1.,450 PW Com uter-4512 1,450 1,450 PW Com uter-4513 1,450 1,450 PW Com uter-4518 1,450 1,450 PW DeskJet Printer - 4847 ~ 500 500 PW DeskJet Printer - 4850 500 500 Water Com uter-3421 1,950 1,950 Water Com uter-4528 1,950 1,950 Water DeskJet Printer 1,200 1.,200 WWTP Laborato Dishwasher 8,250 8,250 WWTP Notebook Com uter- 3893 1,900 1,900 WWTP Com uter-4515 1,450 1,450 WWTP Com uter-4516 1,450 1,450 WWTP Com uter - 4517 1,450 1,450 WWTP DeskJet Printer- 3816 500 500 0 Total CAPITAL REPLACEMEN 0 0 4 475 30 250 34 725 22 ~ s Enterprise Fund Enhancements C~ IF,IZ DIANy- Pcbllc MUBS Enhancement Summary No FY09 Enhancements Requested Total FY09 Enhancements Requested.: $0 FY08 Approved Enhancements: $0 23 • ~~ Public Works Enhancement Summary Stormwater Program Total FY0.9 Enhancements Requested: $75,000 FY08 Approved Enhancements: $83,392 Public Works St01'117Wat@T PI'091'a111 Enhancement #1 One-time Cost: $0 Priority #1 Ongoing Cost: $T5,000 Need/Purpose: To continue to develop the Stormwater Management Program that was a part of the Comprehensive Surface-Water Program presented to Council in April 2008. Goals: To further the development of the Stormwater Pollution Prevention Program. We will provide follow up on work to investigate the Stormwater Phase 2 Program requirements that will likely include public education, involvement and illicit discharge control as well as SWPPP Plan review and inspections. CAE ro~aN~.- r,.nu mo.k. nev..~~~ 24 ;• Water Division Enhancement Summary 1. Radio Read Program 2. Consulting 3, Well Rehab 4. Locating Equipment 5. Waterline Extensions 6. Water Main Replacement 7. Downtown Urban Renewal 8. Well #23 Aquifer Blending 9. Land & Easement Acquisition 10. Miscellaneous Water System Improvements Total FY09 Enhancements Requested: $1,973,6601 FY08 Approved Enhancements: $3,908.,393 Water Division Enhancement #1 Priority #1 Radio Read Program One-time Cost: $183,660 Ongoing Cost: $0 Need/Purpose: Saves man hours in the field when meters are converted from Touch Read to Radio Read.. Goals: Utilizing Radio Read in the field will save man hours which translates into money saved for City. ~fi ~m~ ~~en~ 25 Water Division Consulting Enhancement #2 One-time Cost: $100,000 Priority #2 Ongoing Cost: $0 Need/Purpose: To provide Consulting in areas associated vvith regional water supply planning and coordination., study solutions to brown water, pursuit of alternate water sources, and future FY09 projects. Goals: To help increase water supply via new sources and to help maximize existing sources. cc t~E` Water Division Well Rehab Enhancement #3 Priority #3 ~ One-time Cost: $0 Ongoing Cost: $150,000 Need/Purpose: Increase the production capacity of a well which diminishes over time due to the impairment of ` screens.. Goals: To reestablish original well capacity for less than 25% of the costs to construct a new one. 26 Water Division Locating Equipment Enhancement #4 One-time Cost: $5,000 Priority #4 Ongoing Cost: $0 Need/Purpose: To provide equipment to aid field personnel in finding water meters that are located under the snow. Goals: Reduce the time required to locate and read water meters buried under snow. ~E~~~ water Division Waterline Extensions Enhancement #5 One-time Cost: $585,000 Priority #5 Ongoing Cost: $0' Need/Purpose: Expand the water system into areas between development projects to help City meet the needs of residential and commercial growth.. Goals: To meet demand growth has put on our water supply. Expansion will help maintain water pressure and fire flows throughout City. 27 • •, Water Division Water Main Replacement Enhancement #6 Priority #6 One-time Cost: $75,000 Ongoing Cost: $0 ~ Need/Purpose: To replace aging water mains in older sections of town as needed. Goals: Replacing older water mains before they rupture reduces the risk of damage to neighboring properties. rf~C~~- Water Division Downtown Urban Renewal Enhancement #7 Priority #r One-time Cost: $250,000 Ongoing Cost: $0 Need/Purpose: To replace aging and/or undersized water mains and fire hydrants in the designated Urban Renewal area. Goals: To provide adequate infrastructure to support the urban renewal process. Po ucE,~IAI~,¢" 28 • Water Division Well #23 Aquifer Blending Enhancement #8 Priority #s One-time Cost: $500,000 Ongoing Cost: $0 Need/Purpose: To reduce the uranium content of the existing well to below the maximum contaminant level by either utilizing an on site test well for blending the water from two separate aquifers or for an ASR (aquifer storage and recovery) project. Goals: To eliminate the current use restriction due to uranium level exceeding the maximum contaminant level. ~m~ ~~eo~ Water Division Land 8c Easement Acquisition Enhancement #9 One-time Cost: $0 Priority #s Ongoing Cost: $50,000 Need/Purpose: This request will ,provide us a fund to acquire land or easements needed for water facilities. This request supports the initiative of planning and implementing to accommodate growth. Goals: To have a fund available that will allow us to be proactive in acquiring property or easements. cCCE~~~- 29 Water Division Miscellaneous Water System Enhancement #10 Improvements Priority #10 One-time Cost: $0 Ongoing Cost: $75,000' Need/Purpose: This request will provide us a fund to design and build water system improvements that are not accounted for or applicable to other funds. Goals: Build a fund to be able to seize strategic opportunities when they arise. l~ I~~~ weu~ Wastewater Division Enhancement Summary 1. Consulting 2. Wastewater Treatment Chemicals . 3. Sewer Cleaning/Repair 4. Wastewater Capital 5. Sewer Cleaning/Camera Crew & Equipment 6. Sewer Line Extensions 7. Downtown Urban Renewal 9. Miscellaneous Wastewater System Improvements 10. Right of Way Sewer Line Extensions 11. Water Reuse Interpretive Project Phase I Total FY09 Enhancements Requested: $2,361,807 FY08 Approved Enhancements: $7,945,934 30 • Wastewater Division Consulting Enhancement #1 Priority #2 One-time Cost: $150,000 Ongoing Cost: $0 Need/Purpose: Consulting in areas of operational enhancements, plant optimization and future FY09 projects.. Goals: To improve efficiencies at the plant and refine processes. c4~t'E'~ J" wnuo marb Dapvrtmeut wastewater Division Wastewater Treatment Enhancement #2 Cf1eCt'11Ca~5 Priority #1 One-time Cost: $0 Ongoing Cost: $307,000 Need/Purpose: To enhance plant capacity with CEPT chemicals, provide additional polymer to the centrifuge, and control foaming of the effluent; also helps to remove phosphorus and struvite. Goals: To increase capacity of the .plant while controlling struvite formation and foaming. cRTE~~~" eaeu 31 • •, Wastewater Division Enhancement #3 Priority #3 Sewer Cleaning 8~ Repair. One-time Cost: $0 Ongoing Cost: $300,000 Need/Purpose: To clean the sewer collection system once every three years and maintain sewer odor complaints to less than three per year.. Goals: To reduce the cleaning cycle from once every seven to eight years to once every three years. ~E eoeuo ico.k. uew*~me Wastewater Division Sewer Cleaning /Camera Enhancement #5 Crew ~ Equipment Priority #4 One-time Cost: $603,550 Ongoing Cost: $153,907 Need/Purpose: This enhancement will provide an in- house sewer cleaning crew to clean the collection system once every three years. Goal: To provide sewer cleaning services once every three years in house. cCCE~- wnu 32 • Wastewater Division Sewer Cleaning /Camera Crew 8~ Equipment Enhancements #3 & #5 Comparison Annual Cost Cleaning Schedule .Results Current Program $~eo,ooo 8-10years Not adequately On-Going cleaning system Enhancement #3 $aso,ooo 4.5 years Improved Cleaning Oh-Going schedule Enhancement #5 $333,907 3-4 years Targeted Cleaning On Going Schedule ($146,093/year on- - $603,550 going savings over One Time Enhancement # 3) Enhancement #5 Benefits: • Break Even Point = $603,550 = $146,093/year = 49 months • Improves emergency and spill response (spills, blockages 8 overflows) c4fE~~~- marb Daputment Wastewater Division Wastewater Capital Enhancement #4 One-time Cost: $19,350 Priority #5 Ongoing Cost: $0 Need/Purpose: Ease maintenance and repair worK, allow access to data base from the field, and perform maintenance without taking equipment off-line. Goals: To meet our NPDES permit requirements while saving time and enhancing cost effective operations (~~ IEkt DIANy- ranm ~/ mo.e. aape.cmei 33 • • Wastewater Division Sewer Line Extensions Enhancement #6 One-time Cost: $0 Priority #s Ongoing Cost: $150,000 Need/Purpose: Sewer line extensions in conjunction with ACRD roadvvay projects and other FY09 projects. Goals: To develop sewer line collection system to serve the needs of Meridian residents. ~V(ERIDIANr- e~bue Wastewater Division Enhancement #7 Priority #7 Downtown Urban Renewal One-time Cost: $0 Ongoing Cost: $125,000. Need/Purpose: To replace and repair the sewer system in.the downtown corridor. Goals: ~ To increase sewer capacity in the downtown corridor in coordination with downtown development. l,/y~ Ec[ZIDIAN}~ Publl ~~ 34 • wastewater Division Miscellaneous Wastewater Enhancement #s System Improvements Priority #9 One-time Cost: $0 Ongoing Cost: $100,000 Need/Purpose: Operational and maintenance items and repairs as needed at the plant. Goals.: To provide for public facilities and complete infrastructure repairs that support the needs of Meridian. cCfE lPOrb Dvya=fineol Wastewater Division Rlgllt Of Way Sewer Enhancement #10 Line Extensions Priority #10 One-time Cost: $0 Ongoing Cost: $75.,000 Need/Purpose: The City is required to repair and maintain sewer service lines in the right. of way. Goals: To maintain and repair sewer pipes and sewer service Fines in the right of way. ~ . CQ.(E~ weu~ ~J Worb DeD~men[ 35 • • Wastewater Division Water Reuse Interpretive Enhancement #11 Project Phase 1 Priority #~~ One-time Cost: $378,000 Ongoing Cost: $0 Need/Purpose: This enhancement will provide Phase I of the waster reuse interpretive project in Heroes Park and enable Public Works to partner with the Parks Department for the Heroes Park Improvements. Goals: To provide Phase I of an interpretive center for wastewater reuse in the City of Meridian. Ljl4 E IR D[ANa- we0~ ~/ Worb DeVaRm^vt Enterprise Fund Enhancement History Enftancement History $30,000,000 --- --- -- $25.000.000 _______ ..____..__.. .__ ........... ..._.._____. .._....__...... ...... ..,,.,,... `. , ._.._..__. ._..__..___. ______...._ _____..__.. ._ $20.000,000 ............_... _._.-_. _-_...._ ......__._ _.: :..__..... .._.._.-._ .........,... ._..._...._._ ._ $15,000,000 ~--- --- --- -- -- ---- $10,000,000 ~-~ --- - -- ---- 551000.000 ........._..._. _...._.___. ._.___ _. ___ ....__ -. '. $0 2002 2003 2004 2005 2006 2007 2008 2009 ,..~,y ~ weue mo.t, n~v.,~rovo~ 36 • • Enterprise Fund Future Needs and Projections ~E Pob~c Future Needs & Projections Examples Water Department - Well Reconstruction ~ Rehab - Regulatory Response - Fire Flow Requirements - New Water Quality Requirements - New constituents and lower limits - Ur 8~ Others - Alternative Source Reconciliation 8~ Develop. - Interne Connectivity - Conjunctive Management - Water Rights Issues - Aquifer Characterization Studies - Aquifer Storage 8~ Recovery - Existing Infrastructure Replacements - Growth-Related Investments - Future Needs Studies 8 Rights Acquisition - New Well Construction ~E`~'^.~'~ weuo 37 • • New Well Projection Example 4% Growth 180,000 -----..... _...__....._ _._......_ ........_._. .._...---- ._-_._._ _...--- -- -. _ ,60.000 ---- -- --- -- -- ---- - 1- - - li__ ,40.000 _ _ __ _ _ --- ---- ---- _ _ l __ _ ____ ___ . 1-- ,ZO.ooo _ _ _ _ __ _ _- --l_ _ _ _ _ __ .. __ _ ---__ - -- -l 1- --=- -- --- - --- - ,oo,aoo 1 1 so,ooo _ _ __ __ __ -----_ __ - --- __ _ _ _ ---- ----- ----- . 60.000 eo m o ~ N~ v ~n c° n °° rn o N c~ c u> co a m m o O O N N N N N N N N N N t'7 N N N N N N N N N N N N N N N N N N N N N N N Public mmb Depvtmevt 38 • New Well Projection Example 7% Growth 350,000 --- -- --- --- --- ----..._ ~_._... ------ 2 2 2 - i 300,000 250,000 .:.._ ........... ...__..... ....__..._._. ._......._._. ............._..........2.......:..11-1-___............--- ..1..1.1__...---.- --- zoo,ooo ..---- ------ ...._......-- ---.._._... __ ..._..........._ _ _ 1- li ,so,000-- --- ,00,000 _ ___lll-. -- --- -- --- ----- ---- --.--- -- 50, 000 O O O ^ N f'7 ? to f0 I~ lD OI O N to V N f0 I~ °D W O N N N N N N N N N N In N N N N N N N N N N N N N N N N N N N N N N N ~~- n° Future Needs & Projections Examples Wastewater Department - Regulatory Response - Water Quality -new constituents and lower limits - Phosphorus =Between $25M and $35M in 5-40 years - Nitrogen =Unknown - Other Nutrients =Unknown - Water Reuse - Aquifer Storage - Inflow and Infiltration (I 8~ I) - Odor Control - Master Planning and Infrastructure Planning - Existing Infrastructure Replacement - Growth-Related Investments - Plant expansions ~,(EI~ro~,,,q- weue 39 • • Future Capital Needs Est. Five Yr. Total: $37.5M* *Does not include capacity improvements ~E IR DiAN}- wsuo ~/ WWTP Capacity •Projection Example Flow analysis adds CEPT adds 2 5 mgd expansion 1.2 mgd at minimal mgd capacity $76M -~ cost for $?.M (escalated) Recent Expansion ~ ~ for -$22M~ i ' I I I I i MMF ~ Plant Capacity ^p~ E IDUN wuu. m.rt. u. evc 40 . Wastewater Department • • WWTP Capacity Projection .Example 9 mgd expansion 9 mgd expansion $109M (escalated) $138M ~, Flow analysis adds (escalated) 1.2 mgd at minimal cost CEPT adds 2 mgd capacity Recent for $1 M Expansion ~ r ~ for -$22M ~ ~ i D MMF ~ Plant Capacity ~~pp~~ ~t~IERIDIAh'~ weuo me.t. no .rtmeor Future Capital Needs Food _ for Thought 3,500 homes ~ 1 New Water. Wetl 4, 000 homes ~ 1 MGD of Piant Capacity l.~ IDIAN wem me.s. ~a..cm~oi 41 • • Intermission Enterprise Fund Utility Rate History 42 • • Ra#e History Water Rate History $7 00 -t Water Base ~ 00 --~--Water Usage 0% ss.oo $a.w ~J ss.oo ~6% 0% 0% 3% 0% 4% 8% sz.oo s1.oo 0% -20% 0 0 0 0 0 0 so:oo 2000 2001 2002 2003 2004 2005 2006 2007 2008 ~% ivo.t, newrtmm Ra#e History Wastewater Rate History s,a.oo 0% -65% -rD- WN/ Base s12.oo --~}- WW Usage s,o:oo sfi.oo 5s.oo 0% - 0% - 3% - 0% - 8% s4.oo sz.oo 0% 7% 0% 0% 3% ~ 0% 4% 2% 60.00 2000 2001 2002 2003 2004 2005 2006 2007 2008 Po u 43 • • . Rate History S,O:UO ..._....__.:. $6.00 ....m.....: ~. 56.00 $4.00 - ~, N ' 52.00.... 50.00 2000 2001 2002 2003 2004 2005 2006 2007 2008 PobLc worts nevartm~oe Rate History ~ 2002-2007 Revenue Loss $~,ooo,ooo $o ($2,000,000) ._....----------------......---....__....-------....------..:_..__........_........_ __.:' _._.._- , --....._ ........ ($3,000.000) ...._...._..__.....------ ......................_......._..__....---.-........._.,........_-.._..._.._..._..----.......................__._. _ - ($4,000,000) '------ -...----_ ` _._... ($5,000,000) --- -~-- --- -- ($6.000,000) _._. _ .. _ _ ..._ - .......--- - -- - -.. _ __. ® Wastewater ($7,000,000) ---- -.._....--- ---._.......__- .._ ...............- __._ _..._ O Water ($9,000,000) FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY02-07 e Wastewater 559,359 (560,345) (5229,405) (5263,932) (5499,291) (5533,290) (51,526,904) D Water (5782,206) (5650,329) (51,051,151) ($1,039;456). ($1,398,252) (51,576,664) {56,698,079) ~v„bu~~% worts nsvsremsvr 44 • • Rate History Financial Challenges - Some Contributing Factors: - Reduction In Rates - Significant Recent Capital Spending - Reimbursement Agreement Policy - Initial Payoff - Payments In-Full - Declining Interest Rates - Recent Economic Trends Resulting In Less Assessment Revenues - Rising Cost of Capital Construction ~1~. IEF~ DIANt weuo ~~ lvmb DaDVtme~ Enterprise Fund Rate Model Results 45 ~. Rate Model Results -Existing Rate Model: - One year model -Development of Multi-Year Rate Projection ModeF: - Separates Water from Wastewater Utilities - Separates Water Operations from Water Capital - Separates WW Operations from WW Capital - Allows Variability in Projections - Includes Personnel, Growth, & Inflationary Factors - Projects results and impacts over 5 years -Cross-Checked Results With Existing Rate Model aVUrk. ~.~._ Rate Model Resul#s - Multi-Year Rate Projection Model Assumptions & Scenarios: - Developed. 3 scenarios - Scenarios based on fund recommendations and projected needs - All scenarios utilize a JIT capital financing strategy (saves ~$6.1 M) - Model attempts to anticipate current revenue needs based on future operational, capital, and regulatory needs NOTE: Capital needs will increase with increased system knowledge, new regulatory requirements, revised infrastructure 8 capital plans & upgrades, etc. cCf~~~~ work. Dep.rtmeui 46 • • Rate Model Results - Scenario #1: Status Quo - Assumptions: - Includes all FY09 Enhancements discussed - Does Not include an Operational Reserve - Does Not include a Capital Transfer -~ Does Not include a Deprecia#ion Reserve - Does Not anticipate Regulatory Compliance needs r,CCE`~" Rate Model Results (Scenario #1) Current Proposed $ Difference °,G Difference Average Family Water $15.16 $15.16 $0.00 0.00% Average Family Sewer 19.94 19.94 0.00 0.00% Total Monthly Bill $35.10 $35.10 $0.00 0.00% Assumes average use of 8k for WA 8 6k for WW _ a ,. ~j wnea mo.~. Oao.rtme°~ E&00 _._._ ^ Water Usage ~~~ 51 39 51 99 oWater Base . . Sa.W 53 00 . f4- 04 04 56 5200 00 : : 51. E0.00 50:00 :50:00 OLrreN RoposeE f0iflereee° o warm lka9e. at.39 st.a9 ao.uo o wa~a ease u.oa so.o4 so.oo E9.00 ~~ OSewer Usage [35ewer Base E7.00 ~ 53.06 x.04 ~, E5.00 54.00 i E3.00 H.74 b4.74 5200 51.00 E0.00 'SO:OD D°reN Ropma4 E C5f(erenca o saw ar uaa9a ' saoe E3.oa so.ao v sew ar ease 54.74 54.74 so.ao 47 • ~~ Rate Model Results (Scenario #1) Remaining Cash $4,000;000 .-. -_ -... -._ ~.:`_a.1 ----- - --- • '. ~~ Total Enterprise Fund Balance ""~(rio reserves $0 ($2,000,000) - :~• ... ($6,000,000) --_.._ -.._..__ . .................. _.....-.._ ._.......__.._ .._.-._. ..._...---. ..........._ .-- --...-- ($8,000,000) ....----- -- -----. -. ..-~- -- -- ($1.0,000,000) ..._......--- ------- -- -- ----- ---- - '-----... ._ _ ------ ($12,000,000) 2009 2010 2011 2012 2013 Water ~ 54,547,698 55,190,766 $5,275,519 $5,453,715 $5,731,114 ~Wastew ater 52,457,440 5940,447 ($1,120,799) ($10,213,181) (510;089,485) ~1~.ER[DIAN}- roeuo mo.~uoepartmeoe Ra#e Model Resul#s - Scenario #2: Assumptions: - Includes all FY09 Enhancements discussed - Includes an Operational Reserve - Includes a Capital Transfer - Does Not include a .Depreciation Reserve in FY09 - Does Not anticipate Regulatory Compliance needs ~E ~~~ weu~ wo.`s oevo.we=c 48 • • Rate Model Results (Scenario #2) Ee.OD - ^ Wafer Usage 57.00 6d E1 O WaferBase ~~ . E5.00 E1.J9 EI.00 53.00 Sb.34 Sd 04 f200 : E1.OD '51.30 SO.00 Currer4 Ropmed E [.1lference oWater lhapa. E1.39 51-.84 50.45 _ O Water Bate 54.Da E5.34 51.30 Et4.OD ' S U E t 200 ._...-_.._._... . ....._ ewer sage O O Sewer Bate E6.09 Et0.00 EB.00 E3.04 56.00 Y7.00 S7;9i E2.05 5200 54.74 ' ~ E0.00 CurreN Raiwsotl S dllererrce 0 Sawor lbepa E3.04 E6.09 52.06 OSew er Base 51.74 57.94 E3.20 Current Proposed $ Difference % Difference Average Family Water $15.16 $20:02 $4.86 32.08% Average Family Sewer 19.94 33.41 13.47 67.57 Total Monthly Bill $35.10 $53.44 $18.34 52.24% Assumesaverage use of 8k /or WA 8 8k forWW ~p r w6ue vrorb netr••wear Rate Model Results (Scenario #2) Remaining Cash $6,000,000 - ' $s,ooo,ooo - - - - $3,000,000 .............__ ...___. ....._........_ ........._....-' ---- _.............._ _._.._..- ---.... .-_._. _......... $2;000;000 - - - - - $1.000:000 .........._.._. __._.... ....-._ _.._- .. ............._... ..._._-, __.__. .__.__..... _............._ ____ $0 2009 2010 2011 2012 2013 Water $4,247,698 $4,831,392 $4;837,576 $4,916;687 $5,073;090 -Wastewater $5,457,440 $6,453,895 $7,305,496 $1,186,246 $4;344,031 l~ works Depsrtmevt 49 • Rate Model Res u I#s - Scenario #3: - Assumptions: - Includes all FY09 Enhancements discussed - Includes an Operational Reserve - Includes a Capital Transfer - Includes a Depreciation Reserve in FY09 - Includes anticipated Regulatory Compliance needs Rate Model Results (Scenario #3) Current proposed $ Difference % Difference Average Family Water $15.16 $21.17 $6.01 39.62% Average Family Sewer 19.94 52.26 32.34 162.16 Total Monthly Bill $35.10 $73.44 $38.34 109.24% Assumes average use or 8k.ror WA 6 6k ror WW ~~Ny L/' wEUC Worb Deportment ~.~ ^Water Usa e f7.00 Et.% g OWater Base 56.00 _........_. ._........ ~'~ b1.39 E4.00 ~ .. ~ E3.00 E5.64 E200 E4.04 p. E1.00 :E1.6U EO.OD CwreN Roposed E dffererce o Water Ucega E7.39 E7..94 E0.56 O Water Rasa E4.00 E5.6a E1.6D E25.00 ' O Sewer Usage ^Sewer Base E20.OD b7.97 E75.00 E10.00 Ed.97 b3.06 E12.b7 E6.00 ~ 57-59r . E4.74 SO.W Qllreat Roposed E dfleterce D.Saw er lHega E3.04 E7.97 Ea.93 D.Saw er Base E4.74 E72.43 E7.69 50 • Rate Model Results (Scenario #3) Remaining Cash $6,000.000 .....__._... ......---.._. ....._.__ . ................_ _......_........ -_..._._ _...._._....... ....._....._._. __...._._._ .._...-- $6,000,000- -- $5,000,000 - $4,000,000 ..............._ .._..__- ........- --._......... .................. _..._ _..- ~--~--..... ..._ .._.............. ..._.__. $3000.000 ---~'---. ._........ .---._...... _....... :---....._.. ____.. _..---- ......._...._ ..........-- --... $2;000,000 --- --- -- ---- -- --- ----- - $1.000000 -- ----.....- '----'-- ------.... ----- '------' ---- --- -`--...... _._._._ $0 2009 2010 2011 2012 2013 -Water $1;906,264 $2,907,958 , $3,332,502 $3,848,703 $4,455,311 ~Wastew:ater $2,921,910 $4,128,365 $5,056,266 $1,125,605 $6,747,637 ~eoeuo ~% Regional Benchmarks ~ Regional Rate Benchmarks: Water Szs.oo 7 So~oo p Water Usage Szo.oo ~ _._ _ ............. .. .................. ..........._..._ _._.. .....-- --'-- _ -. _.._._ . .. ~ ©Water Base 515.00 - - 51000 '? ~ 0% - 2o2 ~ 4.5% o - ~?% ~2 - -y - 1 s p ~ ¢ 0 00 ..:$2.32 . t~ N' ~ .~ 50.00 I Boise Post Falls. Lewiston Nampa Aene Twin Falls Meridian fa Is d Water Usage 50.00 $2.02 $0.86 $2.32 50.71 50.65 80.00 51.39 Water Base 521.00 58.11 58.06 85.59 $6.68 86:23 56.84 54.04 Extrapolated for 1,000 gallons of usage wn°~ wo.t, eepercmav~ I 51 • • Regional Benchmarks ~ Regional Rate Benchmarks: Wastewater $30.00 4.5% o $o.oo ~ /o O Wastewater Usage $25.00 - __..SO.oo.-- -~%.._:.--- -....._._.... 00 o Wastewater Base $20:00- - - --~-- $o;oo $15.00 - $25;58 $24.43 $0.29 $10.00 _ 21.77. _~....__? ................ .................. ~'~ar $5.00 - - - - - .,.. $6.1ls $4.74 $4.07 $0.00 post Cceur ' Idaho Lewiston. Twin Nampa Meridian Boise Falls d Alene Falls Palls Usage $0.00 $0.00 $0.00 $0.00 $0.29 $1.30 $3.04 $3.10 Base $25.56 $24.43 $21.77 $16.50 $11.24 $6.16 $4.74 $4.07 Extrapolated for 1,000 gallons of usage. l~ iE[Z, DfANg- wtao vco.t, uev.rtmen~ Regional Benchmarks Average Monthly Water and Sewer Bills $50 00 . .545.91 ~ Sewer $45.00 ~ - ' - - :84 - -~- .52 o Water $40.00 _ . ....38.74 -- - 37.50 -- -- --- - 535 86 ' . $35.1 0 $35.00 521.77 ' $19,55 ._. ........___ I, $30:00 ... _. $16.50 - ' __ ..... ____. ~~ 525.58 522.50 26:01 P $25 00 - - 518.9 4 _ . S24.43 $zo.ao - - - - - 51ssg "520.:14 $24.30 , $10.00 -- ' - ._ $2;1.!00 ,. ',,, _ .. ... .£1494 $16:ZD ' SA1.43 $15.1 6 313;32. i > $5.00 :._ . _ _ _. . ... 0 00 . $ Lewiston Boise/UW Post Falls Nampa Idaho Falls Coeur Meridian Twin Falls d'Alene Extrapolated for 8,000 gallons of water usage and 5,000 gallons o/sewer usage. most. navertmeoe 52 • Summary Financial Position - Contributing Factors.: - Energy price volatility impacts expenses - Increased capital spending over a short period impacted revenues 8~ expenses - Local, Regional, and National changes in economy impact revenues & expenses - Reduction in .rates impacted revenues - Reduction in water consumption impacted revenues - Increasing regulatory requirements will continue to impact future expenses - Rising cost of capital construction c~CE~~~ W.... ~o...m.o~ Conclusion - Balanced budget - Reduced personnel and operating expenses utility- wide by 12.7% over FY2008 (except 1NW) - Reduced enhancement requests by 26% over FY2008 - Freed-up ~$6.1 M in capital expenses by using JIT - Better awareness 8~ reporting/tracking - Longer-term planning horizon - Fiscally conservative - Anticipatory budgeting approach - Mid-course correction - Better use, programming, and leveraging of existing dollars ~` E ~J eoeuo wo." u.n~m.~ 53 • .~ ~y Dep~rtnieat Report Questions ~ Answers 54