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HomeMy Public PortalAbout12-20-1993 PROCEEDINGS OF THE COMMON COUNCIL OF THE CITY OF RICHMOND.INDIANA.SERVING AS A BOARD IN CHARGE OF THE OPERATION OF THE RICHMOND POWER&LIGHT PLANT MONDAY. DECEMBER 20.1993 • 1 The Common Council of the City of Richmond, Indiana, serving as a Board in charge of the operations of the 2 Richmond Power& Light Plant met in regular session at 6:30 p.m. Monday, December 20, 1993, in the Council 3 chambers in the Muncipal Building in said City. Chairperson Brookbank presided with the following 4 Councilmembers in attendance: Elstro, Lundy, Donat, McBride, Parker, Allen, Dickman and Hutton. The 5 following business was had to-wit: 6 7 APPROVAL OF MINUTES OF DECEMBER 6.1993 8 9 Councilmember McBride moved to approve the minutes of the previous meeting as prepared, seconded by 10 Councilmember Lundy and on a unanimous voice vote the motion was carried. Councilmember Parker moved to 11 approve the minutes of the February 22, 1993 meeting, second by Councilmember McBride and the motion was 12 carried on a unanimous voice vote. 13 14 APPROVAL OF BILLS. INVESTMENTS AND TRANSFERS 15 16 Upon recommendation of the Finance Committee,Councilmember Allen moved to approve the following bills for 17 payment,seconded by Councilmember McBride and by unanimous voice vote the motion carried. 18 19 Bills Already Paid 20 Payroll and Deductions 217,253.46 21 22 23- Investments Purchased From: 24 Cash Operating Fund 500,000.00 25 Bond Sinking Fund 26 Utility Bond Reserve Fund ' 27 Depreciation Reserve Fund 1,660,713.95 28 Insurance Reserve Fund 29 Consumer Deposit Fund 30 Cash Reserve Fund 107,215.63 31 Group Insurance Fund 32 33 Total Investments 2,267,929.58 34 35 36 Transfer to City in Lieu of Taxes; 37 38 Transfer from Cash Operating Fund to: 39 Cash Operating Fund for 40 Capital Improvements 266,593.56 41 42 Transfers from Depreciation Reserve to: 43 Cash Operating Fund 44 45 Transfers from Consumer Deposit to: 46 Cash Operating Fund 47 48 Transfers from Utility Bond Reserve Fund to; 49 Bond Sinking Fund 50 51 Transfers from Cash Operating 52 Interest and Bond Principal 53 Bond Sinking Fund 54 Cash Reserve Fund 55 Utility Bond Sinking Fund 56 57 Depreciation Reserve Fund Insurance Reserve Fund 58 Consumer Deposit Fund 59 60 Interest and Bond Principal 61 62 End of Month Petty Cash 63 Revenue Bonds 64 Interest Coupons Redeemed 65 Bond Coupons Miscellaneous Bills Already Paid 1,123,674.67 Total prepaid invoices 3,875,451.27 Total Bills Not Paid 509,055.68 Grand Total 4,384,506.95 • RP&L Minutes Cont'd December 20, 1993 Page 2 1 REMARKS BY CHAIRPERSON 2 3 None were made 4 5 UNFINISHED BUSINESS 6 7 Councilmember Lundy moved to increase the General Manager's salary by 4 percent, second by Councilmember 8 Hutton and the motion was carried on a unanimous voice vote. 9 10 Chairperson Brookbank said the Board had two resolutions, adding that initially there were four but two have been 11 moved to Council in the form of ordinances. City Attorney Thomas Milligan noted a correction in the salary of the 12 human resources clerk for the rate beginning October 1, 1992. He said it shows it as $10.40 but should be 13 changed to$10.92 which would make a bi-weekly pay of$873.60. He added that the position is correctly shown in 14 Resolution No. 6- 1993 at$12.40 per hour and recommended the amendment be made. Councilmember Parker 15 so moved,second by Councilmember Hutton and the motion was carried on a unanimous voice vote. 16 17 General Manager Irving Huffman said keeping in mind Resolutions No. 5 and 6 are identical except for different 18 dates appearing, he proposed the resolution submitted by the City Attorney be changed completely to reflect 19 what he intended to read, with the Board's permission. He explained that he had taken the old salary ordinance 20 and adjusted it, adding that it is what has been used in the past and accepted for many years. Chairperson 21 Brookbank asked Milligan if he had followed the Indiana Code in writing his resolutions and he answered that he 22 had. Huffman said what he wanted to read as a resolution was not in conflict with the Indiana Code, stating that it 23 even makes reference to the code. He said in a conversation with the State Board of Accounts they had indicated 24 that the split dollar insurance and the automobile should be made a part of the resolution because that is part of 25 the General Manager's salary and needs to be included in the salary ordinance. He added that historically the 26 ordinance had a provision to make merit increases, noting that the highest merit increase given was 3.3 percent. 27 He said adjustments had been made in four shift supervisors because of some comparison of other jobs within 28 the utility that needed to be increased along with one of the other supervisors at the Whitewater Valley station. He 29 said from a merit standpoint the increases have been at an absolute minimum. 30 31 Huffman told Board members they needed to keep in mind that RP & L is a $40 million a year electric utility, 32 noting that it is not operating with tax money and a business of this type should not be operating under regulations 33 that are not good for the operation of the utility. He said the ordinance that has been used in the past does 34 address the fixing of the number of employees and allows the General Manager to change that number and it 35 could be approved at the next meeting. He said it also allows any merit increase to be permitted and that could be 36 fixed at the next meeting. He said when the ordinance was drafted by the Board back in the 1970s it was drafted 37 with the idea to allow the utility to operate prudently and it has been operating under those rules. However, he 38 said, it appears there is some concern that now a new interpretation is being expressed but what has been done 39 in the past has been under the scrutiny of many other attorneys and he said he cannot see any problem with 40 what he suggests. 41 42 In answer to a question by Chairperson Brookbank, Huffman said the last time the ordinance was passed was in 43 1992 but it was not passed in 1993 because his salary had not been included. His salary has been adjusted and 44 is retroactive to October 1, 1993 and that makes it possible to go ahead and the salary ordinance will be in 45 complete accordance. Chairperson Brookbank asked Milligan if the resolution suggested by Huffman was 46 acceptable and Milligan answered that it was not, noting that it simply fails to follow the Indiana Code. Milligan 47 stated that it is a question as to whether or not the Board follows the rules or doesn't follow the rules, noting that 48 the question before, this body is the adoption of Resolution.No. 5 - 1993 as amended. He said there is no 49 resolution such as was read by Huffman before this body at this time. He explained that the question, 50 parliamentary wise,would be Resolution No.5- 1993 as amended to correct page 2 of Schedule A and the Board 51 would simply vote on that 'resolution. Councilmember Elstro: moved that the resolution that Huffman read 52 supercede Ordinances No:5 and 6 previously given to the Board. Milligan said Councilmember Elstro's motion 53 was out of order because the Board could handle only one proposition at a time, noting that it is not an ordinance 54 but a resolution. Councilmember Allen moved to amend Resolution No. 5'to include the split dollar life insurance 55 as well as the'automobile and the raise for the General Manager since all of that does go under the salary 56 ordinance,second by Councilmembe r McBride. 57 58 Milligan said Councilmember Allen has made a motion to amend the matter•that is.before the'Board which is 59 Resolution No.5- 1993 to incorporate the split dollar language and the General Manager's automobile. He added 60 'that Huffman has stated the State Board of Accounts has requested that be put into it and that is an appropriate 61 motion to the matter.before the Board. He added that Huffman's rate in Resolution No. 5 1993 is the rate which 62 was set last May which was retroactive-back to October 1, 1992. He said Jim Daugherty did not include in that 63 rate the cost to-the utility of the-split dollar life insurance and the automobile but it would be appropriate to put 64 those items in there, adding that he assumed they could be ascertained as to value. . • • RP&L Minutes Cont'd - December 20, 1993 Page3 • • • • • • 1 Chairperson Brookbank said there was a motion on the floor.to amend and a second plus the increase in salary 2 and the motion was carried on a unanimous voice vote. Councilmember Hutton asked Huffman if new employees 3 are started at a probationary rate and he answered in the affirmative. She also asked about his policy in giving 4 raises and Huffman answered that new employees come up for review every six months for a two-year period 5 and at that time an increase is generally expected to be granted if they are progressing as expected. She asked 6 whether or not the employees started out at the-top dollar of the last person who left and Huffman said they start 7 at the entry level position. Councilmember Hutton moved to insert the provision that the General Manager has the 8 authority to give merit raises. 9 10. Councilmember Allen commented on Huffman's mention of merit raises, noting that the information given the 11 Board was confusing and Huffman said the merit increases are in the third column and the progressive increases 12 in the first. He added that the annual yearly increases are in.the second column. Pointing out the specific 13 increases, Huffman said the average merit increase was 2.47 percent and the total merit increases were 14 approximately .00236 percent of the total take home pay. Councilmember Allen said it was confusing since it 15 covered a two-year period. Commenting on the article in the Palladium-Item addressing RP& L's salary ordinance 16 Huffman said it was printed without any input from anyone at RP & L, adding that he felt the newspaper was 17 remiss in not asking for that input. Councilmember Dickman asked if the progressive increases only applied to the 18 first two years of employment and Huffman answered in the affirmative. In answer to Councilmember Dickman's 19 questions as to whether or not there were exceptions, Huffman said only in cases where a job was changed 20 drastically to include a lot more duties. Merit increases, he said, are given,for example, when a person becomes 21 a C.P.A. or receives a certain educational degree which gives some measuring device to look at. Chairperson 22 Brookbank said there is a motion and a second to amend Resolution No.5- 1993 giving the General Manager the 23 authority to give merit raises not to exceed five percent.The motion was carried on a unanimous voice vote: 24 25 Huffman said the way Resolution No.5 -1993 stands now he is restricted to hire anybody, noting that if he fils a 26 new position in the utility he must come back to this Board. He added that he will do that if it is the Board's 27 pleasure but he has had the authority in the past and now that will be removed. Milligan responded, saying that 28 Huffman has the statutory authority to hire persons and he can appoint supervisors and dismiss employees of the 29 utility, but it is mandated under the statute that the Board fix the number and compensation of employees. He 30 added that this can not be delegated to the General Manager as the last amendment proposed. He said the 31 reason is that the Board is either going to follow the rules or it is not going to follow the rules. He said Huffman 32 can come to the Board in any one of its meetings and state that he recommends a person in a position be paid 5 33 percent more and the Board can adopt that and it amends this standing resolution and fulfills the statutory 34 purpose. He said the Board fixes the compensation and Huffman can get Board approval in three meetings a -35 month, 36 times a year to adjust anybody's compensation. Milligan said it is Huffman's prerogative as General 36 Manager to recommend but it is not his prerogative under the statute to fix it. That, he added, is the Board's 37 responsibility and it cannot be delegated to the General Manager. 38 39 Resolution No.5- 1993 as amended was adopted on a unanimous voice vote. 40 41 Councilmember Hutton moved to amend Resolution No. 6 - 1993 with all three provisions included in Resolution 42 No. 5- 1993,which were the split dollar life insurance program, an automobile use allowance and the authority to 43 grant merit increases up to an additional 5 percent for any employee, second by Councilmember Parker who 44 stated that the salary for the General Manager should also be inserted. Milligan said the General Manager's rate 45 increase effective Oct. 1, 1993, based up the information Daugherty .gave him and reflecting the 4 percent 46 increase voted on here tonight, would be $40.89 an hour, making his bi-weekly salary increased to $3,271.20. 47 Chairperson Brookbank asked for a vote on the amendments and second and the motion was carried on a 48 unanimous voice vote. She asked for a vote on the entire Resolution No. 6 - 1993 and received a unanimous 49 voice vote adopting Resolution No. 6- 1993. 50 51 STREET LIGHT COMMITTEE REPORT 52 53 Councilmember McBride said he had turned a request over to Grimes-to take to the Board of Works and that had 54 been turned over to Robert Hankosky at RP & L for his approval. . 55 56 MISCELLANEOUS BUSINESS 57 58 Councilmember Allen moved to strike Resolutions No. 7 and 8, second by Councilmember Parker and the motion 59 was carried an a unanimous voice vote. 60 61 REPORT BY GENERAL MANAGER 62 63 Huffman said the 1994 RP&L budget has been discussed at several meetings, noting that the expense budget is 64 a projection of the expenses and there didn't seem to be any questions or concern about it, adding that most of 65 the attention is focused on the capital budget. RP&L Minutes Cont't December 20, 1993 . . - •- . Page 4 : . . - . • • 1 The capital budget proposed for 1994 is$7,982,425, Huffman said, noting that many different items had been 2 proposed which had been explained in great detail but asked if anyone had questions.Councilmembers Allen and 3 Dickman questioned the imaging system and Huffman said it had been proposed because RP &L does have a 4 need to get into it. He asked Tim Broering,the Management Information Systems manager,to comment on the 5 imaging system. 6 7 Broering said it is a relatively new technology,adding that one of the manufacturers RP& L is looking at has been 8 doing computer imaging for nine years. He said at RP&L they have had the capabilities to do imaging for 9 approximately six years since 1987 when the first visual system was purchased.He said most of the documents 10 such as purchase orders,bills and memos are generated from the computer system.He said the main thing that 11 was keeping RP& L from getting a computer imaging system was the ability for sharing that information among 12 multiple people within the utility and also keeping it in storage.He said a computer system that sells for$20,000 13 now,sold for$1 million five years ago. 14 15 He said there are several things that have allowed RP& L to take advantage of things that are currently in place 16 such as cheap disc space and cheap computing power.He said RP&L currently has a number of personal 17 computers in place and there is no need to buy any and it has the network which allows employees to share the 18 information, adding that the time is right for computer imaging. 19 20 Councilmember Allen asked how other people shared information and if only one person put the information into 21 the imaging machine then shared it. Boering gave the purchasing department as an example, noting that when 22 purchasing wants to cut a purchase order they type the information into the system then they print it out,in triplicate 23 and the forms are distributed, one to the vendor,one to the originator and purchasing keeps one. He said the copy 24 is stored electronically and at that point a message is sent to the originator or any one else who would need to see 25 a copy of the purchase order. He explained the principle of the electronic mail box, noting that information printed 26 on a computer printer and distributed would all be handled within the computer system, not printing triplicates. He 27 said everything would be routed by an electronic mail system and the image would be stored in one place but 28 would be used by many people. 29 30 Huffman said the computer imaging in the budget is broken down at$125,000 for the hardware and$134,000 for 31 the software. He mentioned the S.C.A.D.A. (Supervisory Control and Data Aquisition)system which had met the 32 Board's approval, noting that it is an important area to get into but it is going to take time. He said they would 33 probably not be receiving any hardware for the S.C.A.D.A.system until late in 1994 or early in 1995. 34 35 He said he would like the Board to focus on the overall budget for 1994 rather than a particular item. He said he 36 would like to see it done as the City does it in that Council advises the Mayor he has so many dollars to work with. 37 He said he would feel more comfortable and less restricted if that were the case. Councilmember Hutton moved to 38 cut the 1994 budget 7.5 percent and leave the cuts to the discretion of the management and the staff,second by 39 Councilmember Donat and the motion was carried on a unanimous voice vote.Councilmember Dickman moved to 40 delete the computer imaging from the budget for this year,commenting that he is sure imaging is in the future but 41 he doesn't think the time is right, noting that$259,000 is a big investment, especially in light of the fact that RP&L 42 is undertaking the$1.2 million computer S.C.A.D.A. project:He said he still thinks there is too much front end cost. 43 . 44 Councilmember McBride seconded the motion made by Councilmember Dickman and Councilmember Hutton 45 asked if that would be included in the 7.5 percent cut. Councilmember Dickman said it could come out of the cut 46 that had already been made.At the request of Councilmember Parker, Councilmember Dickman re-stated his 47 motion,saying that he moved to delete out of the 1994 budget the computer imaging system for the amount of 48 $259,000 and that deletion can come out of the 7.5 percent cut already suggested. 49 50 The motion was carried on the following call of the roll: . 51 • . . - 52 Ayes:Lundy, McBride, Parker,Allen,Dickman and Brookbank(6) • . . • 53 Nays:Elstro, Donat and Hutton (3) - 54 55 Councilmember.Hutton moved to approve the 1994 budget as presented and as amended, both the expense and 56 the capital,second by Councilmember Parker and the motion'was carried on a unanimous voice vote. 57 . • . 58 ADJOURNMENT - - - 59 - . . 60 There being no further business,,on a motion.duly 'made,seconded and passed the meeting was 61 adjourned. • - _ 62 - . . 63 . - , . . 64 . . . 65 Jane R. Brookbank, Chairperson . ATTEST: . Norma Carnes, City Clerk .