City Council to Act on Health Insurance

Last month San Angelo City Councilwoman Charlotte Farmer talked about getting staff salaries up to 85 to 90% of the national averages.  Other council members offered a different comparison group, cities our size or in our region.  Wages are but one component of total compensation, which includes benefits.  One key benefit is on City Council's published agenda:  

29. Consideration of matters related to Request for Proposal HR-01-14: 

a.Discussion of proposals submitted for Request for Proposal HR-01-14 for benefits regarding health/Rx, clinic, dental, flexible spending accounts, employee assistance program (EAP), voluntary benefits and COBRA administration. 

b. Consideration of selecting Benefit Providers related to Request for Proposal HR-01-14, authorizing staff to negotiate contracts, and authorizing the City Manager to execute said contracts and related documents Presentation by Human Resources Director Lisa Marley) 

The city budget projected health insurance costs to soar, with the city picking up a portion of the increase.  How much will employee costs for health insurance rise?  How much will retiree health costs increase?  Several years ago the city hammered employee and early retiree dependents with massive health increases.  It caused nearly 200 people to drop city sponsored health insurance.  The irony was City Council had access to Early Retiree Reinsurance Program funding and chose not to use a penny.

Last year HR Director Lisa Marley changed faces on health insurance costs between budget and council proposal   In one month the projected number swung nearly $1 million.  (fiscal year)

The City's 2013 Comprehensive Annual Financial Report (CAFR) revealed the health insurance fund to be much lower than budgeted, $469,000 vs. the expected $1.23 million. (fiscal year).  The actual drop was even larger.. 

In July Marley flashed a slide showing a projected $2 million increase in health insurance costs (fiscal year).  Staff proposed Council fund $750,000, leaving $1.25 million for employees and retirees to shoulder. 

Former Police Chief Russell Smith has been the voice of retirees on this issue.  Their pay was a fraction of their peers in other cities, yet the selling point was city benefits.  These retirees got neither fair pay or the promised free lifetime healthcare. It must gall retirees to see staff get a 5% across the board increase while their retirement income remains fixed.

Both staff and early retirees will pay more for health insurance coverage.  The question is how much?  Another question is how many positions will no longer have health insurance benefits due to the city's contracting out numerous functions formerly performed by employees? 

Council's discussion should include a deep and honest discussion on health insurance.  That has not occurred in years.

City Sits on Hands while Republic Refunds

The City of San Angelo contracted out its trash and landfill franchises to Trashaway-Republic Services for the last two decades.  Republic's overbilling of commercial customers came to light during the RFP evaluation process, which would determine the trash and landfill operator for the next ten years.  The City abdicated its oversight role, yet again, allowing Republic to audit bills and issue refunds.  At no time dig City leaders call for or conduct an internal investigation into how Republic promulgated these unauthorized fees.  Will Wilde, Ricky Dickson and Shane Kelton all "oversaw" Republic's contract with the city.

Since the city has been hands off Republic can say things like:

All the amounts to be refunded were charged in good faith.

Possibly in good faith that Republic's profits would be maximized, but they did not conform to contract or city ordinance.  The unnamed international accounting firm isn't on record with their findings.  No letter has been made available to the public as to the scope and methodology of their work.

The city failed to explore how this overcharge in excess of $6 million occurred.  No investigative body is exploring the long term bilking of commercial customers.  It's all packaged for public consumption for Halloween, which is symbolic given Republic tricked commercial customers for ten years.   

A class action lawsuit is all that remains between Republic and clear skies.  Republic's legal response to the lawsuit closed with prayer.  Or is it prey-er?

Update 12-7-14:  The Standard Times reported trash customers reaction to the refund and higher trash fees.

MedHab Ready to Announce Major Partnership

MedHab's big news will be revealed next week at a press conference.  City Council representatives and Development Corporation Board members have been invited to attend. 

Update 10-23-14:  MedHab is partnering with the Michael Johnson Performance, Inc.  Johnson is still the world record holder in the 400 meter. 

Water Rebate Consideration Time is Now

There is only one time during the year that it makes sense for San Angelo's City Council to consider rebating a portion of their water fees.  It is after the close of September's financials.  It is both the end of the fiscal year and the end of high water usage as summer's heat begins to abate.

Somehow the City's award winning financial department conned Council into examining rebates in April and November of each year.  The November account is paltry or empty.  Finance transfers fund excesses, often in the multi-million dollar range, as part of its year end close (done in October).  April is also too early as it's before the Water Department's big summer months.

Recall have far the water revenue budget was behind earlier this year?  A $2.4 million figure comes to mind.  The just approved City Budget for 2014-2014 shows a projected deficit of $606,608 in the Water Operating/Enterprise Fund for this year.  This is after the transfer out of $6.1 million to other accounts.

Budgets are projections, so the final tape on water revenues could be shared at the October 21st City Council meeting.  I hope it is.  The public deserves to know.  If not October, then the public will hear something in November.  The question is what?

Michael Dane: Well, each April and November we have an ordinance on the books that requires Staff to look at the fund balance in the water fund and to consider whether the rates, the revenue generated warrants, or has created the situation where we can provide a rebate to rate payers. We’re gonna do that in November anyway; we’ll be discussing results of operations, the net income, or the net loss; that’d be the perfect time to discuss this opportunity so, if this passes we’re interpreting this as a “Be ready to discuss this in November when you talk about the water fund balance.”

Watch for what staff brings to the meeting. I expect one month's performance for 2014-15 and their usual delta approach on how 2013-14 ended.  Hopefully, they'll bring more, show budget and actual performance while noting any water fund transfers made.

This may not be the year for rebates, but it's also not the year to raise fees dramatically to make up for a prematurely represented deficit. 

City Boards & Commissions Deja Vu

Discussion regarding how the City of San Angelo obtains new board or commission members is not new.  Consider this from an August 2011 administrative report:

Boards and Commissions:

Council approved Board and Commission structure on 3-1-2011.  Various recommendations were made and presented for review on 3-22-2011, specifically related to the recruitment committee and board consolidations. City Manager and City Clerk are working with Liaisons to work out an action plan.  Staff is scheduled to present their findings at the September 20th meeting.

Council discussed board consolidations on September 20, 2011 but did not address the process for recruiting new board or commission members.  City staff remain in charge of which names make it to the board or commission for consideration.  Boards are to provide vision, community input and oversight.

A number of highly qualified applicants heard nothing after submitting their names to the Animal Services Advisory Committee when it had two longtime vacancies.  Council appointed a person who is on record recommending illegal treatment of animals as an interim appointee for very same committee..

Obstruction is a strategy for maintaining the status quo.  It operates at multiple levels in at least one arm of San Angelo City government.  Will it continue in the new board member recruitment process?  

MedHab Contract for COSADC Board

Consider Economic Development Director Roland Pena's comments at the beginning of his presentation to the City of San Angelo Development Corporation on August 27, 2014.

"This is a very well respected board and you are on TV and I get the similar kind of comments."

That same meeting the Board received their long requested update on MedHab Inc.  Economic development staff did not have MedHab's contract at their fingertips when MedHab CEO Johnny Ross gave his update . As a public service the contract can be viewed below. 

Medhab Economic Development Agreement with City of San Angelo from jepysdad

How many members of the public could not believe that MedHab was on the agenda and staff did not have the contract?  It's a basic if the aim is to inform.  Otherwise "You are on TV" sounds like theater direction.  

So far the COSADC board has been very compliant with Roland Pena's suggestions.  

1)  The board shifted from two meetings a month to one with virtually no discussion.  
2)  They gave up check signing at their last meeting, allowing this to be done administratively.  Board members did not ask about accounting internal controls and how the new process would comply.    
3)  Roland suggested moving the monthly financial statements to the consent agenda.  After discussion the board decided to have the monthly statements in the background packet and for staff to present quarterly financial reports to the COSADC board.

A key responsibility for any board is fiduciary.  COSADC has the added burden of ensuring its funds go toward primary job creation.  How are they to fulfill this responsibility if checks are cut by staff and financials are only reviewed quarterly?  

BREP starts October 1.  This is supposed to be an automatic program.  If local employers meet the criteria, they'll get a check.  There needs to be much more sunshine in the Development Corporation arena.  Current leadership is dong the opposite, spreading shadows

Ports to Plains: The Rehabilitation of Charlotte Farmer

City Councilwoman Charlotte Farmer will return to the Ports to Plains Alliance board, given Mayor Dwain Morrison is vacating his position in favor of another, yet unnamed board.  San Angelo's City Council nominated Charlotte during its September 16th meeting.  

This move came a year after the same council removed her from the Alliance board, seemingly in punishment for casting stones at another City Council member, Marty Self.  Charlotte Farmer and Christian Reporter News pushed that Self  had a potential conflict of interest as his firm did significant business with the City of San Angelo.  She also broke a story regarding the Council not approving significant funds for the West Texas Water Partnership.  

Consider City Council minutes from September 17, 2013:

APPROVAL OF MAYOR MORRISON’S NOMINATION AND APPOINTMENT TO SERVE ON THE PORTS-TO-PLAINS TRADE CORRIDOR COALITION

Mayor Morrison informed of the quarterly meeting held in October 2013. Offering Councilmember Farmer the opportunity to step down, Ms. Farmer chose not to step down and wished to complete her two year term.  

Motion, to remove Councilmember Farmer and nominate and appoint Mayor Morrison as the Board of Director representative, was made by Councilmember Silvas and seconded by Councilmember Fleming. AYE:  Morrison, Fleming, Self, Silvas, and Vardeman. NAY: Wardlaw and Farmer. Motion carried 4-2.

Video of the meeting revealed the smack down.  Charlotte Farmer's good behavior for 364 days resulted in her reappointment to the Ports to Plains Advisory board.  

Farmer frequently serves as the institutional memory for City Council.  She spoke to her Ports to Plains role at a recent Development Corporation Board meeting.  Farmer omitted her punishment and period of parole in recapping her Ports to Plains involvement.  Image must be maintained.  It also outranks substance.

Update 10-12-14:  The Texas Pacifico trip to Mexico City encountered travel problems trying to leave San Angelo.  American Airlines cancelled their 6:00 am flight to DFW.  This happened three days in a row to relatives this summer.  City leaders knew to drive to Abilene to fly out.