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HomeMy WebLinkAbout2011-04-19 Council Minutes - Work SessionCITY OF KENAI BUDGET WORK SESSION CITY COUNCIL CHAMBERS APRIL 19, 2011 6:00 P.M. AGENDA ITEM 1: OVERVIEW ITEM 2: AGENDA REVIEW a. Changes to Health Care b. Review of Budget by Department ITEM 3: SCHEDULE ADDITIONAL WORK SESSIONS► ITEM 4: ADJOURNMENT CITY OF KENAI BUDGET WORK SESSION CITY COUNCIL CHAMBERS APRIL 19, 2011 6:00 P.M. NOTES Council present: M. Boyle, R. Molloy, T. Bookey, R. Marquis, J. Moore, P. Porter, B. Gabriel Staff present: C. Freas, M. Joiner, M. Bondurant, M. Kebschull, K. Stearns, B. Frates, K. Lyon, R. Craig, J. Dye, R. Koch. T. Eubank Mayor Porter called the work session together at 6:00 p.m. City Manager Koch thanked the City Attorney, City Clerk and staff for their efforts in producing the budget document and noted, the budget had to be recalculated after receiving notice of a large increase to health care costs. ITEM 1: OVERVIEW Finance Director Eubank presented an overview of the draft budget, provided a handout of his presentation and a memorandum indicating changes from the FY 2011 budget, etc. ITEM 2: AGENDA REVIEW 2 -a. Changes to Health Care A lengthy discussion took place related to health care costs and the proposed plan submitted by Administration, i.e. a three - pronged approach of the employee monthly premium, employee deductible, and unutilized self- insurance refund. Koch and Eubank reviewed the differences between the current plan and proposed plan. Comments included: • Some employees understood and were acceptable of the proposed plan, others were not. • Concern employees felt the proposed plan was declared to be what would be. • Suggestion a secret ballot vote could be taken of employees to know really how they felt about the proposed plan. • The proposed plan would be the equivalent of a $2,000 loss to each employee in a take- home -pay perspective and without notification to the employee, could make budgeting very difficult or an extreme financial hardship for some employees; suggested the City pay more this year and move into a new health care plan more gradually. • Increases in health care costs not unique to the City of Kenai. • Concern in asking the employees to double their premiums which was done the last time the cost of health insurance increased; felt the City needed to balance the costs if this was going to be the trend; this would be a hardship to some of the lower paid employees; and, felt it was unfair. • No objection to eliminate the unutilized self - insurance refund. COUNCIL BUDGET WORK SESSION APRIL 19, 2011 PAGE 2 Belief employees need to share in some of the costs, but would like to look at a less burdensome plan. Review of increases in the plans followed. It was noted, if the plan changed to require employees to pay a portion of their health care, an amendment would be required to KMC 23.40.120. Discussion continued, with comments including: Did not like that an employee did not pay for health insurance. The Borough's health plan did not charge the employee for health care. A comparison of some private sector wages was provided. • With the one percent COLA planned this year, employees would be taking more responsibility for costs. Next year, a larger COLA would probably be given and employees would be better able to handle a health insurance increase. • Suggestion to take back the unutilized self- insurance refund and do a lesser increase to see how it would affect employees before deciding on health care. • Removing the unutilized self- insurance refund would still be a loss of income to employees; would favor the City taking the brunt of the cost this year; and, the proposed plan would be a big change from how the City had taken care of its employees for a. long time • An amendment to the Code would be required to charge the employee a fee for health insurance. Approval of the plan by Council at this point would be premature. • Belief the proposed plan was acceptable. • Felt when doubling the premium, there would be a risk the City would drive employees away and, attended one of the meetings with employees and felt the tenor of the presentation was the plan choice was not negotiable. • Stated support of Administration's proposal. • The State and Etna were still negotiating the renewal. Suggested Council set a target of cost to work toward. BREAK TAKEN: 7:50 P.M. BACK TO ORDER: 8:00 P.M. Public Comments: Mike Navarre -- Health Care: Cost of insurance takes away from community needs. Boys & Girls Club: Requested City's financial support for the Kenai Clubhouse; encouraged renegotiating the Recreation Center management agreement; reviewed changes made to lessen their operating costs, i.e. raising fees, cut hours at the Center, cut staff, etc.; the funding request was for the Kenai Clubhouse. Jennifer Beckman, CARTS Executive Director -- Requested a $5,000 donation toward the CARTS program; funds received would be used to leverage for grant funding. COUNCIL BUDGET WORK SESSION APRIL 19, 2011 PAGE 3 Dale Sandahl, Mike Navarre -- Discussed the possibility of building a covered, turf multipurpose facility; believed there were many needs in the community for such a facility; suggested an advisory question be placed on the fall ballot to find out if citizens would be interested in building such a facility; and, it would be a quality of life issue. It was suggested a survey be sent to Kenai residents. Another suggestion was to prepare a conceptual drawing for residents to consider, then do a survey. Estimated cost for drawing and survey was stated as $25,000. Council stated no objection for Administration to investigate grant funding that may be available to pay for the conceptual drawing. 2 -b. Review of Budget by Department Department budget reviews would be taken up at the next budget work session. ITEM 3: SCHEDULE ADDITIONAL WORK SESSION(SI A second budget work session was scheduled for May 9, 2011 to begin at 6:00 p.m. ITEM 4: ADJOURNMENT The work session ended at approximately 8:40 p.m. Notes prepared by: CV II/ et Carol L. Freas, City Clerk