View Agenda for this meeting
REGULAR MEETING OF THE COUNCIL OF THE CITY OF NOVI
MONDAY, NOVEMBER 28, 2011 AT 7:00 P.M.
COUNCIL CHAMBERS – NOVI CIVIC CENTER – 45175 W. TEN MILE ROAD
Mayor Gatt called the meeting to order at 7:00 P.M.
PLEDGE OF ALLEGIANCE
ROLL CALL: Mayor Gatt, Mayor Pro Tem Staudt, Council
Members Casey, Fischer, Margolis, Mutch, Wrobel
ALSO PRESENT: Clay Pearson, City Manager
Victor Cardenas, Assistant City Manager
Tom Schultz, City Attorney
Kathy Smith-Roy, Finance Director
Rob Hayes, Director of Public Services
APPROVAL OF AGENDA
CM-11-11-173 Moved by Staudt, seconded by Wrobel; CARRIED
UNANIMOUSLY:
To remove item #1 under MATTERS FOR COUNCIL ACTION – Part I
- Acceptance of proceeding with items approved and deferred in the
2011-12 budget (Civic Center roof, Single axle dump truck, Customer
Relations Management software, Gasboy Fuel Management System, and Senior
van), and the design phase of the City Council Chambers Video/Audio
enhancements using restricted PEG cable fees.
Roll call vote on CM-11-11-173 Yeas: Staudt, Casey, Fischer,
Margolis, Mutch, Wrobel, Gatt
Nays: None
CM-11-11-174 Moved by Margolis, seconded by Staudt; CARRIED
UNANIMOUSLY:
To approve the Agenda as amended
Roll call vote on CM-11-11-174 Yeas: Casey, Fischer, Margolis,
Mutch,
Wrobel, Gatt, Staudt
Nays: None
INTERVIEWS FOR BOARDS AND COMMISSIONS
-
Raymond Weidenbach – Election Commission – He gave a brief history
about himself. He has lived in Novi for 35 years, He has a
Bachelors, MBA from U of D, is a CPA, a member of the American
Association of CPA’s, Michigan Association of CPA’s, and has been a
member of the Election Committee for two years. Member Casey asked
which particular objective does he wish to accomplish or was there
anything he would like to see done? Mr. Weidenbach answered, not
really because it is flowing smoothly now. To give an example, the
last election one of the school districts forgot to notify the City
Clerk of a ballot proposal but everything was on the ballot. With
the checks and balances in place, it picked it up before the
election. We printed the ballots only once. Other than that it has
been smooth going for us. Member Wrobel thanked him for stepping
forward and thanked him for his current service on the commission.
He had no questions for him. Mayor Pro Tem Staudt had no questions.
He said he is very lucky to work with Maryanne. She does a great
job. Member Mutch had no questions and thanked Mr. Weidenbach for
stepping forward and offering to serve another term. Anything not
running well in the area in the city, we would be the first to know
about it. Member Mutch said at least in the last two years that he’s
been on the Commission things have run smoothly and actually for
many years before that things have run smoothly. He was satisfied
with the performance of the Commission and with his role on it.
Member Fischer wanted to thank him as well and had no questions.
Member Margolis asked Mr. Weidenbach what he learned most while on
the Commission. Mr. Weidenbach answered it is a little more
complicated than people think. As far as the City Clerk, she has
done the job of collecting all this information and for staffing of
all the precincts but trying to balance it between Republicans and
Democrats becomes a little bit of a chore, but she has done a really
good job with doing it. Member Margolis said people don’t really
realize what is involved so it was good for him to educate the
voters. Mayor Gatt said he didn’t have any more questions either. He
just wanted to say thank him for his service to our community.
-
Scott Teasdale – Library Board – He wanted to start by saying he is
a new Novi resident for the past 3 years. He said he is excited to
be here and to be part of the community and start giving back and to
start serving the community. So that is why he applied for the
library board. A brief overview of his education was that he has a
Bachelor's in Business from Western Michigan University, a teaching
certificate in Business Education at the High School level and an
MBA that he just completed at Eastern. Member Wrobel said on his
application, he wished to be on Parks and Rec and Library Board and
asked why the Library Board? Mr. Teasdale said it was a tie between
both of those areas as he was passionate about physical education
and activity and what that provides to the community. He was also
passionate about education and resources to a community. That was
reflected in his educational and business backgrounds. Mayor Pro Tem
Staudt noticed on his application that his job was to help
administer State and Federal Grants. How could that translate to his
participation on the Library Board? Mr. Teasdale responded his main
duties are budget development budget monitoring and general business
administration tasks for daily operations of Federal/State grants at
Eastern Michigan and he oversees a portfolio of grants that exceed
three million dollars in operation budgets annually. Just the record
keeping and budget development is a good skill to have that will
lend itself into that. Also working with schools and working with
different communities because we search three different school
districts and working with different level of sponsors lends itself
to seeing a larger picture and seeing how things integrate and how
that could be served and seeing political trends for the library.
Also, doing proposals for grants is a simple way to help and his
skills will lend itself there. Mayor Gatt said this was great and if
this does not work out be sure to come back for Parks and Rec
because we are always looking for grants there. Member Mutch stated
that from the perspective of our library patrons they obviously have
this beautiful new library to visit and use. What did he see as
opportunities from services that we could offer to the community or
new opportunities the library could take on that he would see as
possibilities that he could pursue as a library board member. Mr.
Teasdale replied technology and blending that technology service
with a brick and mortar location is a tough blend it is going to
become more predominate in the near future and is something the
library is doing well. But as technology changes you have to be on
your toes and keep that going. That is something that his skills
will lend to it because of his business education background and
certification is business marketing and technology where he can
understand the technology and maybe see some trends that can lend
itself to the library and serve the patrons and the citizens of
Novi. Member Fischer said it was great to see residents especially
early on in their residency to come forward. He asked if there was
anything specific to our library kind of branching out to this
opportunity thing but that he would push for as far as changes or
opportunities that he would want to implement specific to the
library as it is today. Mr. Teasdale said after looking at the
strategic plan, the one thing is outreach. You always are trying to
reach certain demographics and the one thing that he didn’t see that
was noted that he may lend some help in would be reaching mid 20’s
to early 30’s patrons. Since everyone is busy with their career
usually, especially in this area, maybe transient populations coming
in to work at the local corporations is to maybe team with the local
apartment complexes and see if we can get some media and some things
in the leasing packages and maybe do an outreach similar to a senior
outreach where you are doing the pickup on a Thursday once a month
to pick up media and things like from those apartment complexes
because most of the people in there are that age bracket and are
working on school. They have late hours. Even though it is
convenient to pull right up to the new drop box, they may not be
aware of that. Another thing would be an outreach maybe doing a
program off site at the apartment complexes and opening up that.
Also do concerts more in tune with that since we have that great
patio now to do a concert basically for that age group. Member
Margolis thanked him for stepping forward as the Library Board was
very near and dear to her heart. Since he talked about technology
and marketing and based on his knowledge, she thought they do some
wonderful things to embrace technology. She asked if had had any
thoughts in terms of what they could do better in that area? Mr.
Teasdale responded the tablet PC’s would be great and reaching out
doing that. Maybe job fairs networking is using that technology
incorporated give it the 21st century job skills for the
citizens. Specifically speaking though, would be the tablet PCs and
keeping on board with that next newest trend where the media is
going. Member Casey noted this board was also near and dear to her
heart as well. She noted he had given Council a little bit of
insight into his thoughts on outreach related to a particular age
range. Were there other marketing initiatives that he would suggest
or want to see carried forward if he became a member of the library
board? Mr. Teasdale replied when he looked at the strategic plan, to
measure your demographic in your marketing plan is going to be so
specific to all those age ranges all the demographics so maybe just
being specific to that and after looking at more data then maybe if
he was on the board, then a specific plan could be created for that
and reach out. Mayor Gatt did not have any questions but just wanted
to thank him for coming out. It was gratifying to see somebody who
has only been here for only a short time to want to volunteer. That
is what makes Novi so great.
-
Carol Spennachio – Public Access Promotion Committee – She thanked
them for the opportunity for the Pomo committee in 2011. It has been
a great experience, great people and great energy. David and Brian
put together an eight week program to train people. People are still
working through this presenting their own program so really great
things are happening. And we have created some advertisement that
was shown on the overhead screens at the Farmington civic theatre.
We have a lot of plans for this year and she hoped Council would
give her that opportunity of being part of that committee again. She
looked forward to putting forth more energy this next year and
getting more involved in the training. Possibly writing the manuals
with David’s and Brian’s expertise. She could put that together from
her business background and her own private interest was of course
seeing some additional health programs put on the air. Mayor Pro Tem
Staudt said he was the newest appointee to the SWOCC board and
looking forward to finding out a lot about what is going on there.
He didn’t have any questions at this point. Member Mutch thanked Ms.
Spennachio for stepping forward again and being willing to serve.
The question he had was that she alluded to a number of forth coming
projects that the group will be working on asked if she could talk
about one of those items coming forward that she was most excited to
see come to fruition? Ms. Spennachio one of the things was about
this curriculum that David and Brian Golden have developed. It is an
eight week program the people have been coming every single week.
They spend two to three hours and were developing their own program
working together. We are developing new ideas of how we can reach
out to people that have taken the training in the past but have kind
of slipped through the cracks. So we would like to get in touch with
those people do a face to face, voice to voice, email to email or
whatever we can do to see if we can stir up some more interest
because it is a phenomenal tool that many countries would want to be
able to do. So we are very fortunate to have this SWOCC studio that
we do and the support staff that is there. Member Mutch said he was
looking forward to seeing that come forward and seeing the results
of that work and her continued involvement on the committee. Member
Fischer thanked her for stepping forward again and he looked forward
to her to continue to serve and bring some of those programs to
light. He asked about which groups should be targeted for outreach
or more general. Ms. Spennachio said she’d like to spend an evening
dedicated to brainstorming to explore all of the possibilities to
see who has strength in what area. This year was a lot of fact
finding for her and she’s done a lot of training with choir
directing and theatre work but not specifically in the television
industry. The energy we have been building this year she sees as
growing and would like to see a really great brainstorming session
and maybe even Mr. Staudt would like to join us or at least be
invited. The training they offered in the summer time was well
attended. We had about 20 people who came and we need to reach out
to those people to pull them back in to say you know you were on
fire then let’s build on that let’s really bring this to the
community to see where it goes. Member Fischer appreciated the
enthusiasm she brought. Member Margolis remembered when Ms.
Spenacchio came to interview before. She was impressed then and
really appreciated the time that she put in. She noticed Ms.
Spenacchio attended every single meeting during that time and
appreciated that and definitely had her support. Member Casey had no
questions but echoed Member Fischer’s comments that appreciated her
enthusiasm. It shines through. Member Wrobel also served on the
committee years ago for a number of years. It was very interesting
and there were a lot of opportunities to do things. He asked what
the biggest hindrance SWOCC has right now. Ms. Spennachio the
positive side is a little bit stronger. We have a phenomenal team.
We have so much energy together. We are really great. We have
support from the staff, and we are looking forward to just doing
more than we did last year. Mayor Gatt didn’t have any question but
wanted to say her for your enthusiasm and volunteering.
-
John MacInnis – Historical Commission – He would like to be
reappointed to the Historical Commission. He has lived in Novi for
34 years and was retired from the construction industry. He has a
degree in Civil Engineering and a strong interest in history. He’s
read quite a few of Civil War books. He belongs to the Northwood
Genealogical Society. He’s been on the commission for three years.
Member Mutch was very familiar with his background and service on
the Historical Commission. He’s attended just about every Historical
Commission event or been present serving on behalf of the Commission
as much as some of the other members. He was one of the faces that
people most recognize with the Historical Commission in Novi. He
asked what was the one initiative he was most interested in
pursuing. Mr. MacInnis replied there were a lot of projects that we
are working on. The first project that we are working on is trying
to improve all the communication we have with the City, our mapping
better, get our historical sites better and then he would like to
particularly to have tours at the historical sites. We are strongly
trying to improve our information in the Historical room at the
library. In the short run, he would like to see us have something
related to the Civil War because we are currently in the 150th
anniversary of the Civil War and how Novi ties into the Civil War.
We have a few events that are going on. Those are some of the things
we are working on. Member Fischer stated he’s met him several times
and gotten to know him a little better at many events in the past
year. He was definitely one of the more familiar faces on the
Commission. What can Council do to assist in reaching their goals
and objectives? Mr. MacInnis thought Council has been very good,
particularly this past year encouraging them to build the obelisk on
Eight Mile. That was their biggest project this year. Member
Margolis stated the baseline project was a wonderful event and
really raised the profile of the Historical Commission. She loved
the idea about the City tours. She found that when she walked the
City, she would run across a historical maker that she hadn’t seen
before. She asked if they’ve done any work on that and is the
Commission looking at that closely? Mr. MacInnis said one tour was
held a year ago led by Kathy Mutch. It was very enlightening to him.
He lived and worked in Novi in over 40 years and was surprised how
little he knew about the history of Novi. I think we need to
communicate much better on what we are doing and where all the
historical sites are. One of the things we want to do is to put
signs up and to get the places noted on city maps with the help of
the GIS Department. Member Casey appreciated him seeking another
term on the Historical Commission and asked if he had any thoughts
around ways to market or to bring people in some of your events and
get larger attendants? Mr. MacInnis said we wanted more people to
come to their events. Their big event is the Heritage Festival in
June. It is a wonderful event. They are looking for ways to
communicate. Our main communication is through the schools. We are
not getting to the slightly older group of the City. We had a
display this past year and he was a little disappointed how many
showed up for that event. Member Wrobel asked about the Landings and
their ideas to commemorate it. Mr. MacInnis noted they wish to put
some signs up there. They have not done enough work in that in that
area. Mayor Pro Tem Staudt said he noted there were so many
residents near that property that have a huge amount of history.
Also, with former Chief Begole having been there when the casino
burnt down, there are a lot of things we can bring to the forefront.
In addition to the Indian burial ground, he would like to see a
review done of that property because as time goes on, he thought
that was going to be one of the ear marks that Council would spend
some effort to bringing that forward. It would be nice if they could
help with that process.
-
Kimberly Holdaway – Historical Commission – She thoroughly enjoyed
the opportunity to serve the community through the work of the
commission. She has been a resident for about 7 years now. Local
history was extremely important to her. She had driven by the
Landings site for ever and never knew what was there until she
served on the Historical Commission. She liked the opportunity to
interact with the community in some of our events. Especially, at
the Historic Fair the festival that they host. It was fun to give
the community a little taste a little of the history of the area and
how we lived in the past. She would appreciate a reappointment on
this Commission. Member Fischer asked what could Council do to
better support their goals and objectives as a Commission. Ms.
Holdaway said she appreciated having the local history room in the
new library. It was a great welcoming environment for the public. It
would be better if more people knew about this room. She also
suggested some type of publication in Engage to have the support of
the community in the local history room. Member Margolis noted in
terms of the outreach of the Historical Commission, the City
certainly could do more to help. People like to learn in little
nuggets these days. She’s learned as she walked around the City as
she ran across a marker. She asked how they could promote the
knowledge in new ways? Ms. Holdaway said she was working toward an
on-line map with historical markers of what remains within the City.
A lot of the history of Novi is gone. There is the possibility of an
on-line tour. We took a tour as a commission and it was very
interesting. Member Casey asked if she had any goals or objectives
to accomplish in her next term? Ms. Holdaway answered they are
working toward a display to educate the public what the Commission
does. Her favorite event is Fall for Novi because it is an
opportunity to be in the community and talk to people. We tell them
about the library historical room. Member Wrobel thanked her for her
service and for stepping forward again. He noted it seemed like
opportunities are there to teach to school children and wondered if
there could be a partnership with the schools to put on
presentations? Ms. Holdaway said it was a great idea and she knew
that in third grade, the focus on history is local. She noted their
experience with the obelisk project based on the information they
had on Novi’s history. We have a lecture series that we could bring
into the schools. Mayor Pro Tem Staudt appreciated her efforts. One
of the first things he saw on cable was the special on the Walled
Lake casino. He thought if they could put together what they learn
in the Commission, that would be of great value. This is a good time
to relay our priorities. There hasn’t been much of a funding request
in the past several years. Keep doing a good job and produce those
TV shows. Member Mutch noted looking at the business history of Novi
and corporate community members who have been a part of Novi’s
history, the corporate community tends to turn over a lot more. Many
have been key pieces of the City of Novi. He would like to see the
Commission identify some of those members and give recognition to
them. The cost of signs has always been an issue. Maybe on the
technology side, we could take things like the mapping concept and
identify sites around the community of business members and have it
online or through a smartphone application. It would be a way for us
to share a lot more information with a broader audience. Mayor Gatt
noted they could focus on people as well as places with all the
history in Novi.
-
David Ghannam – Zoning Board of Appeals – Mr. Ghannam stated he is
the Chairman of the Zoning Board of Appeals and an attorney with an
emphasis on real estate. Member Margolis appreciated his service on
this Board. She had no questions. Member Casey thanked him for
stepping forward and for his past service. Member Wrobel mentioned
he had the opportunity to work with Mr. Ghannam. He supported him
for another term. Mayor Pro Tem Staudt appreciates him continuing to
serve. He had no questions. Member Mutch appreciated the care with
which he handles the ZBA board and decision making process as he is
a good role model. It is not an easy position. He liked the way he
handled unusual requests. Member Fischer said he also had the
opportunity to serve with him and agreed he was one of the better
minds on the board and had no questions. Mayor Gatt thanked him for
coming out and for his service
James Gerblick – Zoning Board of Appeals – He began that he’s the
newest full time member and voted in the last meeting. He is a CPA
with a wide range of experience with government compliance and
financial audits. He’s enjoyed serving and learned a lot the last
couple months and would like to serve another term. He would like to
learn what the ZBA board is responsible for. Member Casey thanked
him for coming out and had no questions. Member Wrobel asked what
was the biggest challenge he’s faced being on the Board for such a
short time. It is a unique position. Mr. Gerblick replied that many
members are attorneys by trade. The legal aspect and compliance with
ordinances. Your decisions are more of a judicial decision. You have
to apply the ordinances and make sure the request fits within them.
It has been a challenge but definitely a welcoming one. Mayor Pro
Tem Staudt said he will support him for a full term. He thanked him
for his service and the city is very fortunate to have attorneys and
CPA’s to serve. Member Mutch thanked him for stepping forward again
and had no questions. He was glad he could take on the role as a
full time member and looked forward to him serving in that capacity
for several more years. Member Fischer asked about one of the more
challenging cases that he saw in the last few months. Mr. Gerblick
said a case that first comes to mind where he voted against it and
the rest voted for it. It was actually approved. He found it
challenging because when you look at these ordinances there is a
very strict set of guidelines that the requests have to meet and if
they don’t meet the guidelines you really aren’t supposed to grant
approval. The particular case was to move a sign forward for an
apartment complex. He felt the need was more for a desire of the
apartment owners rather than a need. Member Margolis said that
having the courage to vote against the other board members in the
first meeting was impressive. She noted that he had perfect
attendance. His interest in learning was an important attribute.
Member Gatt had no questions and thanked him for his service.
Jeffrey Gedeon – Zoning Board of Appeals; Board of Review - He is a
four year resident of Novi. He now works at the law firm of Carrier,
Blackman & Assoc. He’s served on the ZBA for 18 months and is up for
re-appointment. Member Mutch thanked Mr. Gedeon for stepping forward
again. You are a brave soul who is willing to serve on the ZBA which
is challenging enough. It shows that he obviously must care a lot
about this community and with his background was willing to put it
to where it best can be used. Member Fischer said he didn’t have any
specific questions as related with the Zoning board. Member Margolis
said she didn’t have any questions. She was very familiar with his
work. She really appreciated him stepping forward being willing to
serve. We are very fortunate. Member Casey had no questions but
thanked him for his term on the ZBA and his willingness to serve
another term. We need more residents like him to step forward and
serve the City. Mayor Gatt had no questions. He thanked him for his
time and his service.
Ronald Boron – Board of Review – He could not attend.
PUBLIC HEARING - None
PRESENTATIONS
- City of Novi identified as one of seven Top Performing Communities
in the State for fostering entrepreneurial growth and economic
development; and City of Novi recognized as a Four Star Community – Ara
Topouzian, Economic Development Director for Novi, said the City of Novi
has been identified as one of seven Top Performing Communities in the
State for fostering entrepreneurial growth and economic development. A
study had been done by researchers at I Labs, which is part of the
University of Michigan Dearborn Center for Innovation Research. More
than 100 cities, townships and villages participated in this annual
project which helps local governments understand how to encourage small
business growth and benchmark their economic development efforts. In
addition to performing all the numerical portions for 2010, the seven
top performing communities are recognized for programs that foster
entrepreneurial growth. These communities demonstrate that they
understand what small businesses need to be successful by communicating
with them and providing connections to broader resources and insight on
trends. Novi along with other communities was honored a few weeks ago at
a ceremony at the U of M Dearborn campus and presented the award for our
accomplishments.
- Comprehensive Annual Financial Report Audit Presentation for Fiscal
Year Ended June 30, 2011 - Andrews Hooper & Pavlik – Randy Morse
congratulated Novi on an overall good year. He thanked Kathy Smith-Roy,
Marina Neumaier, and all their staff. What Council sees is their
financial report. What belongs to Andrews, Hooper and Pavlik (AHP) is
their opinion. Everything else is prepared by the Finance Department and
pulled together. It is presented to AHP for them to audit. A lot of the
work goes into it by the Finance Department. The big booklet is prepared
by the Finance Department. They have done a lot of great work. They had
great cooperation with management, but recognize they report to City
Council and their responsibility is with Council. They prepared required
communication and they are all to the affirmative. There were no
significant matters noted during their audit. They did have an
unqualified opinion which is the top opinion they can provide. The City
continues to be a low risk which means for the past two years there have
no findings or questionable costs to the expenditures. There were no
internal control deficiencies. Also, there was no letter of
recommendations. On an overall basis, there were just excellent results.
In addition, Novi is one of the first large cities to have their
consolidated annual financial report uploaded to the State’s website.
That means that the systems in place to close the books and get the
audit completed and uploaded are very efficient in their function. That
is a great accomplishment, also. One thing when going through the
financial report, when reading the discussion analysis, it does provide
a good set of results. As you go through you can look at the
fluctuations from one year to the next. A lot of the explanations are in
there. The City has a Standard and Poor’s bond rating of AA+. Population
increase is 16.5% based on the 2010 census. Family Circle Magazine rated
Novi one of the top ten best cities for families. Opening of Novi Public
Library this year. For the city as a whole, an increase in government
wide net assets of 5.5 million to 331 million. There was a decrease in
bond payable of 8.7 million to 56 million. Government-wide revenue
increased approximately 1.7 million. Government expenses increased about
1 million to get to government wide net assets at June 30, 2011 of
approximately 331 million. Related specifically to the general fund,
there was an increase of fund balance of 1.7 million. General fund
revenue transfers increased approximately 2.1 million and general fund
expenditures decreased slightly about 200,000 dollars. The increases are
where they need to be and expenses are controlled. Good job by the City.
Property taxes show a decrease from 37 million to 32.5 million. State
shared revenue is up to 3.7 million and that is based on the population
increase. Investment earnings and all other stay pretty consistent from
one year to the next. The trends are favorable. Governmental funds,
general fund, and the total governmental funds from 2010 to 2011are 66
million compared to 59 million. The fluctuations include decreases in
personnel costs. We had a 14% staff reduction. We also had wage and
benefit concessions go throughout the year to continue to keep those
expenses down from one year to the next. Government expense trends are
pretty consistent from one year to the next. The revenue trends have
property taxes with a slight decrease and building & planning reviews
with a slight increase. No big significant changes but consistent from
one year to the next. The constitutional part of the State shared
revenues was where the increase was. The expenditure trends in the
general fund are consistent from one year to the next. There’s a good
show of monitoring expenses. General fund balances was in total, 11.4
million for 2011 compared to 9.7 million. There’s an increase in the
general fund balance. The unassigned fund balance last year was 8.5
million to approx. 7.1 million this year. The unassigned fund balance as
a percentage of budgeted of annual expenditures, 2011 is 24.6% compared
to 28.6% for previous year. It is consistent going through each of those
years. Unrestricted net assets from the governmental activity side of
the equation is 12.2 Financial net assets, which takes the total net
assets on your government wide set of statements, subtract what is
invested in capital assets and then pull out your unfunded pension to
get to 23.1 million. For water and sewer operations, revenues were 18.4,
operating expenses 16.9 to get you to the working capital of 43.3. It
excludes depreciation. Then on working capital for the 2011 year
includes 31.3 in capital replacement at June 30, 2011. To summarize the
results of the audit, there were no issues. The good news was there were
no surprises. They want to make sure they do their professional
skepticism and make sure that they ask those questions so that they can
provide the opinion and give Novi the results they need to see. On an
overall basis, a clean opinion, no findings questioned costs, great
cooperation with management and the results were very good.
Mayor Gatt said the document was a
testimony to our City manager and his staff and City Council for being
economically conscious. Member Mutch’ question was in reference to page 34,
not having a policy for custodial credit risks of investments. He was
curious if that was typical for a community this size in the nature of the
deposits investments and where those funds are invested or is that is
something the City should put in place. Mr. Morse said it is typical. The
footnote is a general requirement. Member Mutch asked if there was any harm
in having a policy or is it not applicable in this situation. Mr. Morse it
comes down to whether it is needed. No sense in having the policy just to
have the policy. Member Mutch asked about the processes in the audit where
they might want to do something different or was flagged to be evaluated
further. Mr. Morse did not have any of those recommendations. He was glad he
mentioned what an audit entails. It is not 100% sampling. It is a risk based
approach. They look at the significant systems in place. He talked about
Novi being one of the first large cities to upload the financial reports to
the State web site. A good system is in place. In order for that to work,
they look at financial reporting as significant system with many
transactions and a lot of dollars flow through. They look at that as a
significant system so then they are going to document that system and look
for the controls in place. There are two aspects they look at. One, is the
system properly designed and is it functioning the way it is supposed to be
designed. Novi has a good system in place and then they implement that
system to make it very efficient. Every time they come in, they are still
looking through the systems taking their experience dealing with other
governmental entities and also dealing with business enterprises and seeing
if it is more efficient or more effective to do it a certain way. Each year
we have come through with those systems and felt Novi had a good system in
place and operating effectively. They also do a little bit extra work that
may not be a normal part of an audit. It shows that the staff is always
looking for ways to improve also. Member Mutch wanted to note that the City
paid off 8.6 million in debt obligation and that was a real testament to the
focus Council has in paying off long term costs. Some of it is mandated. It
is showing that we are making a real effort as a city to take care of the
long term costs especially if you look at other communities across the State
and see they haven’t been as diligent or they simply don’t have the
financial resources to pay off those debts. We continue to move in the right
direction. Mayor Pro Tem Staudt noted Council was looking at going to a two
year budget cycle. He asked what their experience was with that and what are
the pros and cons? Mr. Morse stated you always have to operate on a going
forward basis thinking five to ten years out. The expenditure side is
generally easy to budget. As long as your first year budget is good, that
you are making sure to understand the assumptions being used in the second
year, using it for your higher level of decisions not the lower level type
decisions because things may change from one year to the next. When looking
back on the crash we had nobody expected the result to be what it was. The
expenditure side will be easier to do than the revenue side of the equation.
Two years out isn’t as bad. He said when management is doing the budget they
are always thinking through the future. It is evident in the expenditure
control. It wasn’t that you had to cut 30% because you had no controls.
Again next year’s budget, if you do two or three years, just remember when
you start making decisions on those, understand the assumptions, especially
on the revenue side of the equation because they are going to be less easy
to control. Mayor Pro Tem Staudt noted some people at the County feel we are
anywhere from 2-6 years away from recovering. Mr. Morse stated everything he
has heard with emphasis on the residential mortgage side of the equation and
they have a very large financial institutional practice; they continue to
say that we haven’t seen rock bottom. The property taxes will continue to
decrease and many banks have a lot of real estate on their books or reposed
property. They can’t sell it at depressed prices. It costs banks to hold on
to that. They are going to start to get rid of that and if they start to do
wholesale sales, that would have a significant impact on the overall market
from that stand point. We are seeing improvement in Michigan economy. He
would say you should look outward to a three year time frame. Mayor Pro Tem
Staudt said that some of these large bond holding organizations are selling
a significant property at extremely low prices. They mentioned some
properties in and around Novi. One was his old office building. What kind of
effect do those kinds of commercial sales where an entity that has tens of
billions of dollars of bonds and are dumping property? They are getting rid
of the properties partly because of maintenance costs and nothing to do with
the actual value of the property but with the long term upkeep of the
property. Mr. Morse explained that there are banks that have a significant
amount of commercial properties. We have to ask how many new businesses are
coming into the State. That commercial property is not moving. As mentioned,
if you hold a building there is a cost to it. So at some point it is better
to move than to hold on to it and that has to have a negative impact from an
economic standpoint. Mayor Pro Tem Staudt asked how he would characterize
where we are currently in our policy maintaining an 18 – 22% minimum fund
balance. Mr. Morse explained that it is not an easy answer when you look at
that. The reason is there are a number of municipalities within the State
that would love to have Novi’s balance sheet. Maintenance costs going
forward are going to be less on new buildings like the library. If you have
older buildings and have a deferred maintenance, it will require you to have
a larger fund balance than somebody else that has 10% fund balance but
everything they have is relatively new. It is not easy. When he looked at
the fund balance, he thought the fund balance policy is a good policy to
have and Novi has been staying within that. On a personal level you don’t
always spend your entire paycheck. You are always putting something away on
an annual basis because you never know when you are going to have something
that you will need to take care of. Member Fischer asked about a GASB
classification change? Mr. Morse said it happened this year but didn’t have
a significant impact. It is just differences in wording. Member Fischer
mentioned revenue was greater and expenditures were lower and less than 1%
difference or variation. He commended the staff on getting that variance
down year after year. Member Margolis asked about the financial highlight
section, page 2 from the Leadership group memo and asked if he could explain
it to her. It said that we made excess contributions of 375,000 into
post-retirement health care and it talks about the standard that was used
when we made those excess contributions was a percentage of payroll. In
other words, for those who have retired prior to June 30, 1994. So we were
paying for those employees a percentage of current payrolls? Kathy
Smith-Roy, Finance Director, stated how the retiree health care works and
how that additional contribution is being figured is a percentage of payroll
and actuarial amount that we are given to contribute is a fixed amount, so
there is a slight variance there. There is a slight additional contribution
from that. The larger portion from the contribution comes from the retirees
that were on the pension plan for 1994. So we made a conscious decision when
we started the retiree health care program to start funding it forward,
however the general fund funds those retirees before 1994. So we weren’t
draining the fund that we were trying to build. So that counts towards our
additional contributions because they are part of the retiree health care
plan in total. Member Margolis mentioned our funded ratio for the
post-retirement health care based on the valuation of 2009 and asked if she
was correct that since this was published, that we got another valuation?
Kathy Smith-Roy said that is correct we are now at 60% funded in the retiree
health care. Member Margolis said we see a lot of indications of our
financial health. There are always the pieces the public doesn’t see. We are
still collecting 99.5% on our tax levies. It is higher than in previous
years. Our assessments are still holding on and we are collecting on our
assessments. The City has been paying down debt without issuing a lot of new
debt. We have been paying a lot of capital projects through current dollars
that we used to issue bonds four years ago. Debt to value is the lowest it
has been when you go back to 2002, it was 2.3 and now it is 1.0. So many
things in the audit including the number of employees is lower than the
employees we had in 2002 even with a huge population boom. She thanked the
staff, City Manager, Administration and to have this kind of financial
statement with a drop in staff and a huge raise in population is impressive.
Thanks for making our job easier by what you do every day. Mr. Pearson, City
Manager, thanked the Mayor for the comments and for all the work of the
staff and the auditing firm. He noted this is their second year with us.
They have given us a fresh perspective and he challenged them to find new
ways for the city to work on things. He wanted to say something about the
City transparency efforts as we have the web dashboard and it has a link to
the Munetrix website that compares the City of Novi audit numbers to others.
It gives people a taste for not only how we are doing but compared to other
jurisdictions that we try to bench mark against. It is available on line now
with the help of the staff. Mayor Gatt thanked them for coming out and for
their service to the city.
REPORTS:
1. MANAGER/STAFF – Novi Road Link Opening - Mr. Pearson
reported on the Novi Road Link Opening last Wednesday. The Road Commission
for Oakland County opened all 5 lanes of Novi Road, Wednesday, He thanked
both the Road Commission and staff Engineers for their work on this project.
2. ATTORNEY - None
AUDIENCE COMMENT – Kathy Crawford, County Commissioner, was
present to congratulate everyone on the election. She also noted how
fortunate the community was with all those who volunteered for the City of
Novi. She brought brochures that explained what Oakland County Commissioners
did and she also brought the Oakland County Directory for all Council
members. She will be presenting a proclamation to the Library for receiving
the award as a Library leader, as the Library received the only award in the
State. She was pleased to hear Council talk about the history of the
community. She reported that $4,000 would go toward having a Novi history
display cabinet on the first floor of the Library. She also noted she hosts
a Commissioner’s Corner cable TV show. She will interview George Miller,
Oakland County Medical Director. She will also interview Jean Meyer about
Providence Hospital’s services. The City staff and administration have been
doing this work for a very long time and contributed to this for many years.
She noted the familiarity with the two word story. Novi’s would be Open?
Open. This includes transparency, creative solutions, open and welcome to
diversity, partnerships, etc. Novi was excelling because of forward
thinking.
CONSENT AGENDA REMOVALS AND APPROVALS (See items A-J)
CM-11-11-175 Moved by Fischer, seconded by Mutch; CARRIED
UNANIMOUSLY:
To approve the Consent Agenda as presented
Roll call vote on CM-11-11-175 Yeas: Fischer, Margolis, Mutch,
Wrobel, Gatt, Staudt, Casey
Nays: None
A. Approve Minutes of:
- November 14, 2011 – Regular meeting
B. Approval of the final pay estimate to Matzak, Inc. for the
2010 Sanitary Pump Station Upgrades project in the amount of $8,840.95.
C. Approval of the final balancing change order and final pay
estimate to Metropolitan Power & Lighting, Inc. for the Beck Road and Cider
Mill Traffic Signal Installation project in the amount of $10,394.54.
D. Approval to award an amendment to the engineering services
agreement to URS Corporation for additional construction inspection services
related to the Beck Road and Cider Mill Traffic Signal Installation project
in the amount of $1,998.75 (which is offset by the charges to the
construction contractor for exceeding the number of crew days that were in
the construction contract).
E. Approval to award a unit price Pathway Snow Clearing
Contract to Brien’s Services, Inc., the low bidder, in an annual estimated
amount of $29,000.
F. Approval to Award the Purchase of Natural Gas Supply for the
April 2012 through the March 2013 billing cycle to Interstate Gas Supply,
Inc. (IGS).
G. Approval to award an engineering services agreement for
design engineering services for SAD 176 Woodham Road Water Main extension to
Spalding DeDecker Associates, Inc., in the amount of $9,023.
H. Approval of Change Order No. 1 to V.I.L. Construction, Inc.
for the Meadowbrook Lake Dam Renovations project in the amount of $77,284.
I. Approval to execute an affidavit terminating escrow and
returning a sanitary sewer easement to Tasmin Devco, LLC, associated with
site plan approval requirements for the Neher Sales office development
proposed to be constructed at 41700 Eleven Mile Road.
J. Approval of Claims and Accounts – Warrant No. 856
MATTERS FOR COUNCIL ACTION – Part I
1. Acceptance of proceeding with items approved and deferred in
the 2011-12 budget (Civic Center roof, Single axle dump truck, Customer
Relations Management software, Gasboy Fuel Management System, and Senior
van), and the design phase of the City Council Chambers Video/Audio
enhancements using restricted PEG cable fees. REMOVED FROM AGENDA
2. Policy discussion on the repair and replacement of mailboxes
damaged as a result of winter maintenance operations. NO ACTION TAKEN
Rob Hayes, Public Services Director/City Engineer spoke about
all the other communities that do not physically replace the damaged mail
boxes. They either provide a standard mailbox or in-kind cash. DPS spends
$20,000- $30,000 a year and 400-500 man hours replacing mailboxes. They are
looking for a practice or policy going forward. Member Wrobel asked if the
amount spent is a constant amount? Mr. Hayes said it is an estimated amount.
It was probably in the upper $30,000 last winter because it was a more
severe winter. Member Wrobel asked what steps have we taken to reduce
damage. Mr. Hayes said the damage is usually not from the plow but from the
snow thrown into the mailboxes. Also, they encouraged residents to shake
their mailboxes to make sure they are sound. Member Wrobel asked if the
style of the mailbox is a USPS requirement or could it be an ordinance? Mr.
Hayes said the USPS has minimum standards of what type of mailbox is
required. The standards are loose and lets a homeowner improve the minimum
standard. Member Wrobel was leaning towards a policy where the homeowner
gets a minimal reimbursement. Mayor Pro Tem Staudt thought we should not go
cold turkey this winter. He suggested we use this year to evaluate it and
restrict the amount to be reimbursed. He could not support it now. He asked
Mr. Hayes to provide detailed information documented on a per instance basis
after this year. Mr. Hayes said our practice is to put up a temporary
mailbox immediately, then in the spring put in the mailbox in April. Mr.
Wrobel said he would like more documentation. If we had some firm numbers in
the future he would be able to support something. Member Fischer asked if
the $20,000- $30,000 included the man hours? He continued to ask if there
are three mailboxes, would we reimburse the homeowner $150 or $50 for each
mailbox. Mr. Hayes said the way he has it written in the draft policy
resolution is a little more detailed. If only the box is damaged, we
recommend only a $25 reimbursement. In case one or more it would be $25 each
and if the post was damaged it would be another $25. Member Fischer asked if
there is a difference in the policy if the plow does the damage or the snow
does the damage. Mr. Hayes said he didn’t differentiate but it could be a
component of a policy. He commented that he could support some kind of
policy based on the dollar amount the City spent. He wanted to see
additional data. Member Margolis noted a resident near her had their mailbox
exploded. She had called the City and asked what they do. The City had come
out and fixed it. She said it is a positive thing for the City. She was not
in favor of this policy based on her experience. Mayor Gatt commented and
agreed with everything Member Margolis said related to mailboxes. His
concern for residents is that someone may not have the ability to have
someone assist them. He suggested hiring part-time staff to replace the
mailboxes. This was a public relations issue. We usually compare ourselves
to other cities, but not in this instance. Let us try to reduce the cost. He
said the USPS has a specific criterion for replacement. He would not be in
favor of a policy. Mayor Pro Tem Staudt questioned three houses side by side
that had very decorative mailboxes that were all damaged on the same day. To
him it was more than coincidental. He said something happened in that area
that needs to be identified because we shouldn’t have three houses on the
same day with their mailbox damaged. He continued to say that communication
is needed with the Association, resident, or if it is the design of the
mailbox. Mr. Hayes said he was not familiar with that specific case but what
will happen in cases like that, the posts may be rotted through and the
mailboxes will go in succession like that. Mayor Pro Tem Staudt said we
should not have liability where the posts are rotted. There are things down
the road we have to think about that should go in to this policy. Member
Margolis said she didn’t want staff to stop bringing these things to our
attention. They appreciated DPS approaching Council with it. Mr. Pearson
noted we will get more documentation.
AUDIENCE COMMENT – None
MATTERS FOR COUNCIL ACTION – Part II - None
COMMITTEE REPORTS - None
MAYOR AND COUNCIL ISSUES - None
CONSENT AGENDA REMOVALS FOR COUNCIL ACTION: None
AUDIENCE COMMENT - None
ADJOURNMENT
There being no further business to come before Council, the
meeting was adjourned at 9:07 P.M.
________________________________
________________________________
Robert J. Gatt, Mayor
Maryanne Cornelius, City Clerk
________________________________ Date approved: December 5,
2011
Transcribed by Jane Keller
|