COUNCIL PROCEEDINGS

January 9, 2006

 

 

The Regular Meeting of Titusville City Council was called to order by Mayor Sanford in Council Chambers at Titusville City Hall at 5:30 p.m.  The Invocation was given by Mr. Saintz.  The Pledge of Allegiance was led by Mayor Sanford.  Present at the meeting were Mayor Sanford, Councilmen John Frye, Jeffrey Saintz, Dennis Peden, Robert Mayer, Mary Ann Nau, City Manager, and Herbert Butcher, Solicitor.  Holly Matthews represented The Titusville Herald.  Chris Fiely represented GBS. 

 

PUBLIC PARTICIPATION - (Pertaining to Agenda Items)  - None.

 

OLD BUSINESS

COUNCIL PROCEEDINGS

Feberuary 13, 2006

 

The Regular Meeting of Titusville City Council was called to order by Mayor Sanford in the Community Room at Benson Memorial Library at 5:30 p.m.  The Invocation was given by Mr. Frye.  The Pledge of Allegiance was led by Mayor Sanford.  Present at the meeting were Mayor Sanford, Councilmen John Frye, Jeffrey Saintz, Dennis Peden, Robert Mayer, Mary Ann Nau, City Manager, and Richard Winkler, Solicitor.  Holly Matthews represented The Titusville Herald.  Chris Fiely represented GBS. 

 

It was moved by Mr. Frye, seconded by Mr. Mayer to accept the minutes of the regular meeting of 11/14/05, 11/28/05, 12/12/05, 1/9/06 and the minutes of the special meeting of 12/6/05, 12/27/05, and 1/3/06 as submitted and place on file.  Vote on the motion was:  Mr. Saintz, Mayor Sanford, Mr. Mayer, Mr. Frye - yes; Mr. Peden - abstained.

 

Mayor Sanford stated that he would like to read something that was in the minutes of the November 14, 2005 Council proceedings reported in the newspaper.  It also was reported on GBS Television.  It says: "Mayor Sanford stated that he would make a recommendation that anyone in the community who is interested in the finances and the budget that the City is about to begin work on, to come to the budget work sessions and make their feelings known.  Offer suggestions.  Think outside the box.  Give them some ideas of maybe where they would like the community to go if it is not going in the direction they think it should.  Mayor Sanford stated that this Administration has been very careful to not point fingers at past mistakes which they are living with.  Decisions that were made that they had no input on, but they have had to face the circumstances and deal with the outfall, and they have done that quite successfully for six years, but it appears that it is going to get more difficult.  There are going to be some hard choices to be made.  They are faced with some choices that will be made that will affect the future of this community for years to come.  Mayor Sanford stated that any amount of input that can help them reach resolution and come up with a plan to make this work, it would certainly be welcomed.  Anyone who has interest or some thoughts on how they might be able to do this better, they certainly welcome the input at this time."

 

Mayor Sanford stated that before they move on to public comment he would like to make another few remarks.  For some background, in August of 1999, the City of Titusville was on the verge of declaring Act 47 distressed status.  The criteria for such status was met, and by any standards set forth by the Commonwealth, we should have been declared distressed.  A group effort to prevent this was successful and greatly appreciated.  Mr. Nystrom may have forgotten, but I was a participant in some of these meetings.  

 

Jeff, Bob, and I opted to run for election in the May 1999 primary simply because our community was in serious trouble.  No individuals had stepped forward to fill current vacancies on Council, and we believed we could and should invest our time and talents helping our community.

 

At our first gathering, (Bob, Jeff, and myself) we committed to each other that:

 

1.We would develop a procedure to employ the most qualified individuals we could afford to carry our mission forward.

 

2.We would attempt to identify every condition within the City that was either unfair, unethical, illegal, or wasteful.

 

3.We committed to continue the necessary corrective action until our goal was accomplished.  That goal being the restoration of equitable, accountable, and responsible local government for the citizens of Titusville.

 

What we discovered was astonishing.  Today, even with all the corrective action taken we still, and will continue to, uncover moves by previous administrations that are both costly and inequitable.

 

Beginning with the WWTP, the City had entered into a Federal Consent Order and Agreement with the EPA in 1997.  A Scope of Work had been mandated with Phase I to be completed by 12/31/01.  The most preliminary work had not begun.  The order required PA DEP specifically grant all new waste connections and any re-connection of abandoned lines.  Consequently, no new construction could take place in Titusville without permission from the DEP.  Sewage rates for some of Titusville's largest wastewater contributors had been arbitrarily established by City management.  There was no basis for setting the rates, the ordinance essentially being ignored.  Responsible system users were subsidizing these organizations through their own service payments.  Adding insult to injury, the City was being fined nearly every month for violations, taking away a portion of the funds needed for corrective action.   The end result was completion of a $9.2 million project, with $1.9 million being met with grant funds.

 

On the Water side, we were faced with similar issues. Throughout the community were users without meters, creative connections to help "special" users to avoid paying the base rate, meters that had been intentionally estimated low for years, meters that were worn out or otherwise inoperable and in some instances, meters that had never been read. Yet another instance of responsible citizens, those that pay their water bill every month, subsidizing rates for others.

 

Collection on service accounts was averaging in the lower 80th.  percentile. No procedure was in place to insure that customers could be compelled to pay their bill or even have their service discontinued for non-payment. The computer system, an IBM System 36 was inadequate for establishing an appropriate collection procedure. This system, which automatically purged records older than 12 months, allowed thousands of dollars owed to the City to simply disappear every quarter. In spite of this knowledge, the prior administration spent several thousand dollars on the system to make it Y2K compliant. We found it impossible to make informed decisions with incomplete and inaccurate data.

 

We concluded that the infrastructure necessary to provide the most basic of City services, namely water and sewer, was in need of a complete overhaul. This has been ongoing, and will continue until it's being done correctly and responsibly. Most important, every customer using City services has the right to be treated equally. We are very aware that we can't anticipate every problem before it arises, and we promise corrective action whenever necessary.

 

Regarding uniformed pension contributions, taxpayer obligation to the funds for Fire and Police has increased in the neighborhood of $300,000 annually. This increase can be directly attributed to generous contract and retirement benefits agreed to by previous administrators and councils. Additionally, these pension funds were granted distressed status by the Commonwealth and the City was invited to participate in the Commonwealth's Act 205 Pension Recovery Act of 1984. Though the City recognized the need for assistance at that time, the necessary actions of Council were never fully consummated, resulting in a loss of much needed aid. Unfortunately, this program was terminated by the Commonwealth in 2003.

 

The City had farmed out services that could be more efficiently provided in-house at less cost. City Service bills were collected at the local bank. This resulted in a charge to the system of about $7,000.00 annually. This work is now done at City Hall with the same number of personnel previously employed. No additional hours were added to complete the work.  Payroll was also moved in-house. The clerk responsible for its preparation prior to 2001, is able to both prepare and process payroll in less time than it took to put it together for the contractor that prepared it. This improvement paid for itself in less than two years.

 

Regarding responsible management and cost control, we found no evidence of a financial planning procedure. Department heads made capital requests using general approximations, the requests were granted, purchases were made and any left over money was kept for discretionary use by the particular department. There was no oversight of the purchase process or any incentive to provide taxpayers with the best value for their dollar. Crisis management was the order of the day. Until a need was imminent, no provision was made to plan for future eventualities.

 

Council representation on boards and committees with responsibility for allocating and spending City dollars was abandoned sometime in the 1990's.  This allowed entities with no vested interest in the resident taxpayer, to spend your tax dollars.

 

The control function necessary for checks and balances within the City's finances was nearly non-existent. The City was unable to properly track both income and expenses. This allowed taxpayer dollars to be re-directed at times for personal use. In addition to the above, we discovered:

 

·    Tax dollars being loaned to employees, interest free, paid back through a payroll deduction plan.

·    Employees using City accounts to make tax exempt purchases.

·    City equipment and labor being used for private work both in and outside the City.

·    Employees determining their paycheck by establishing their own work schedules to build in overtime and premium pay.

·    City facilities being used as personal car washes and repair sites for both employees and certain "special" non-employees.

·    Individuals using the City's tax I.D. No. for personal purchases.

·    A loan made to the pension fund from the general fund in 1999 of $5,000.00 that was somehow forgotten.

 

This is just the tip of the iceberg.   We have faced staggering increases in the actual cost of providing basic, required services for any City of any size. The increase in pension contributions alone amounts to nearly 5 mills of property tax. The loss of more than $81,000 annually in property tax revenue for the Titusville Opportunity Park by itself equates to 1.3 mills in lost revenue. Just these two issues alone would force less committed organizations to significantly increase property taxes.

 

It has not been the practice of this Council to lay blame. Pointing at yesterday's culprits will not pay tomorrows bills. I've articulated here a brief synopsis of what took place in the past, how we arrived at the current situation, and with your support and input, how the City of Titusville will move beyond our problems. The citizens of Titusville deserve and have a right to a government that treats them all equally. I assure you we've been working at top speed for six years to recover the City that our predecessors "frittered" away.

 

Mr. Peden stated that that statement is pretty broad and as a past Administrator of this Community, 99% of that does not go back to his period of time.  Mayor Sanford stated that is true.  Mr. Peden stated to make a broad statement that it has been all past administrations and Council is not true.

 

Mr. Saintz stated that he agrees with most everything that Brian put forth.  Back in 1999 when they decided to run for Council he thought maybe he could bring something to the table.  Mr. Saintz stated that he got on Council in 1999 and he has seen some things and found out some things that Brian mentioned specifics that were very loose.  They got new auditors.  What they told the new auditors was audit the books.  Give us internal controls so that when standards are applied to one group of people they apply to everybody including the City.   Mr. Saintz stated that for folks to say they don't take into consideration folks on fixed incomes and things like that is just wrong.  Some time ago, Mr. Nystrom mentioned alternate parking and we had a conversation about alternate parking and we are probably going to review alternate parking again in the future.  I think we have a disagreement on some of this, but alternate parking was one of the concerns that I had.  Mr. Saintz stated that they had asked the Public Works Director how is that going to reduce the costs of the City.  Unless you eliminate individuals, the costs are the same.  Mr. Saintz stated that they are investing time and energy to make things more efficient or easier for Public Works at the inconvenience of taxpayers.  Mr. Saintz stated that they should be concentrating their efforts on making things easier and better and more cost effective for the taxpayers and if that inconveniences Public Works, work around it.  Mr. Saintz stated that some of the things that they have agreed to purchase have been to make Public Works more effective but to produce tangible results for the taxpayers. 

 

Whenever they instituted the EMS tax at $52.00 a big chunk of employees who work at the hospital live outside of Titusville, many outside of Crawford County, but yet they would always complain to him about the condition of Main Street, about how slow the Police Department is to come up and unlock their car door and on and on.  Mr. Saintz stated that they had the opportunity to adopt that so that people coming in and using services like that would make a contribution and have a stake in repairs and snow removal and at the same time they eliminated the resident tax and the per capita tax.  Mr. Saintz stated that it concerns him that the decisions and positions that he takes are painted as showing no regard to people on fixed incomes.  Mr. Saintz stated that they are not going to move this City forward by looking over our shoulder into the past.  Mistakes were made in the past, in the distant past, and weeks ago and we will continue to make mistakes, but we need the input from folks on better ways to do things.  Costs have been going up.  Hospitalization costs continue to go up.  We do not get a lot of relief in ways that we can generate additional revenues.

 

Mr. Saintz stated that in his mind a lot of pension benefits should be the result of negotiations through the collective bargaining process, through compulsory binding arbitration with the Police but some things were just given away at the Pension Board level or wherever not subject to negotiations.  Mr. Saintz stated that many of those things indeed have been picked up and mandated by the state but there haven't been additional revenues forthcoming from the state.  Brian mentioned a $300,000 increase.  The revenues that were obligated through the defined benefit plans.  Pensions get real involved, and if you pay attention across the country, pensions are becoming a bigger and bigger problem.  Mr. Saintz stated that they struggle to meet those obligations.  Some of the bond obligations they inherited.  Some of the bond obligations they were forced to take over by DEP or EPA regulations.  Mr. Saintz stated that he volunteered to a couple of folks if they have questions or problems to give him a call.  Mr. Saintz stated that the hospital is going through some difficult times right now and one of the things that was said is there is nothing wrong that more doctors and more patients won't help them solve.  Mr. Saintz said there is kind of a parallel in this area that some of the things that are wrong, there is nothing wrong here that new businesses won't help.  We need to refocus efforts on that whether it is TRA, the Chamber and Council, and what they can do to help get those in here.  Mr. Saintz said he doesn't think we have frittered away a good community.  In this past week he talked to two individuals who have come to Titusville and they have come here for a lot of positive reasons.  Mr. Saintz stated that they need to concentrate on the positive things and work to move forward.  During the last meeting they had someone say that it costs more to live here than it does in West Palm Beach, Florida.  Mr. Saintz stated that moving from Titusville to West Palm Beach, Florida, depending on whether you own a home or rent, it costs 18% more.  Some of these things are said and they are simply not true.  Mr. Saintz stated that nobody is happy with the water and sewage going up.  They are looking for ways to get those things down.  Mr. Saintz stated that part of that is a water rate study to make sure that what is being charged matches up with the actual costs of doing business.  Mr. Saintz stated that they are trying to do their best and they welcome the input from people.  Mr. Saintz stated that it was tough when they started back in 1999.  Mr. Saintz stated that some things they can't change by regulation not just with pension, but in a lot of areas.  Some things are real difficult to change by virtue of collective bargaining agreements and those things don't change overnight, but they have gotten a lot of changes in there that he wouldn't have thought a couple of years ago.

 

Every union and non-union employee contributes to the cost of their hospitalization.  They are not going to resolve all the concerns in six years or eight years and that is part of why they have taken some efforts towards long term planning to anticipate some of these changes and try to do their best to meet those challenges.  They are all in it together.  They are all paying the same water rates.  They are all facing the same kind of challenges.  They have businesses coming to town.  Mr. Saintz stated that he talked to an individual over at Honeywell.  They closed a plant in Texas and moved people up here to work in that plant.  That is pretty significant.  Mr. Saintz stated that he thinks they need to get out there and do whatever they can to help keep them here. 

 

Mr. Mayer commented that he came back on Council in 2000.  He knew the City was in trouble.  He never realized what he got himself into.  Over the years they have done the best they could.  Mr. Mayer stated that what comes back to him is where was he in 1998 and 1997.  Mr. Mayer stated that it is his fault that they are here because he did not pay attention to what was going on in the City.  Mr. Mayer said all he can do is just keep trying to correct all the mistakes whether it is past, previous or not, but he feels that they tried their best to repair the problems that needed fixed.  Mr. Mayer stated that they all have to work together.

 

Mayor Sanford stated that that dissertation was not pointed at Dennis Peden's administration as City Manager.

 

Mr. Peden stated that he has been on Council for six weeks and found his name in a letter to the Editor already for something that happened umpteen years ago.  Mr. Peden stated that the biggest thing they need to do as a Council and as an Administration in this community is not just sit here and listen to you folks but open a dialogue with you.  Pay attention to what you are saying.  Make sure you get the answers.  Mr. Peden stated that the answers may not be the answers that they want, but make sure you get an answer.   

 

PUBLIC PARTICIPATION - (Pertaining to Agenda Items)   - None.

 

MANAGER'S REPORT 

 

Each year as part of the budget process the City Administration and all of its departments have put together a Year in Review which becomes a benchmark of where they were from the year before, where they have gotten to in some cases.  Mrs. Nau stated that she has the 2001 through 2004 Review here which is a part of every budget and each of Council has the 2005 Year In Review which is ready for them to put into their Budget document. 

 

Mrs. Nau stated that she looked at the 2001 through 2005 reports and there has been some major construction and renovations in this community in those years that she would like to review for everyone's sake in the meeting here tonight.

 

Built and/or rehabilitated or major renovations since 2001 have been: The All American Car Wash; Erie Homes for Children; Keystone Rehabilitation; Main Street School; Dollar General; Northwest Savings Drive-Thru; Titusville Area Hospital - numerous projects; Heavenly Grounds; Perk Place; Comfort Inn; Four Sons Brewery; Boonies Sports Bar; Charter Plastics; Taylor Ramsey expansion; Phase II of the Towne Square; the Lutheran Home which has been breaking ground up on Rockwood; Ice Cream business on Central Avenue; Erie Homes - second facility is being built; Fox's Pizza; Carter Field; Diamond Lunch expansion project.  Today I learned that Farley's is looking at expanding also at their present location.

 

New Home Construction - 604 Walnut, 422 E. Spruce, E. Elm St., W. Walnut Street have been constructed in some cases on lots that have become available because of some type of fire or demolition activity there.

 

The sewer inspections and home sales was put in place back in 2001 as a requirement of the DEP so that we could continue to meet the nine steps that they mandated in our recovery program.  In 2001 there were 82 inspections performed and homes certified; 2002 - 67; 2003 - 75; 2004 - 87; 2005 - 86.  These are people who have actually sold their home and someone is now occupying that residence.

 

Condemnations - We've only been tracking since 2004.  There were four condemnations in 2004 and five in 2005.  That is due to the stepped up efforts of the Code Officer, the Fire Department and the Police Department in some cases where we have had methamphetamine activity.

 

Demolitions - In 2002, there were three due to fire and two commercial demolitions for expansion projects.  Probably one would be to build the All American Car Wash because there were three dilapidated residential homes there that were torn down to make space for that particular expansion.  In 2003 there were six demolitions.  In 2004 there were thirteen demolitions.  Some were fire related and some were to make room for expansion for existing businesses and/or new businesses.  In 2005 there were four demolitions.

 

In going through these reports, listed below are things that I could see that were outstanding in regards to action taken by City Council to assist Titusville Redevelopment Authority in their development effort at the Titusville Opportunity Park.

 

The Planning Commission worked on an over-lay Zoning District which was then adopted by Titusville City Council for use at the Titusville Opportunity Park to allow for some lesser restrictions on zoning.  Water/Sewer Agreement was adopted. Vacation of portions of Spring and Caldwell Streets to allow for further development there.  Use of CDBG funds for demolition of abandoned buildings and also the transfer of surplus City property when we had something that they could use.

 

Titusville Renaissance, Inc. - We offered the use of meeting space for monthly meetings.  Office space provided in City Hall.  There was Capital project funds for a Main Street Manager designated for both 2003 and 2004.  There was a Capital $5,000 transferred to Titusville Renaissance, Inc. last year to allow a partnership with the Chamber for specific project completion.  The City reactivation of the Farmer's Market in 2003 crediting Titusville Renaissance, Inc. as a partner.  Titusville Renaissance, Inc. will officially take over that program in 2006 and a GIS overlay created of the downtown area to assist with project completion such as downtown inventory and other activities they need to do for the Main Street Manager Program.

 

With the Chamber there was the Holiday Parking Program.   City participation in the Business Fair.  Downtown lights before 2005.  That has since been taken over by an independent group.  Ban on skateboards/bikes in the Commercial downtown through adoption of Ordinance and shortened hours of parking meter enforcement to promote shopping in the downtown.

 

Today we received notification from PennVEST that they have released the final payment on the Phase II sewer project and they have detailed the cost which was $5.2M.  The updated cost estimate was $5.2M.  The cost presented at closing was $5.3M.  The total expenditures of costs to date was $5.2M.  Attributed to borrower equity - $907,000.  Attributed to loan & grant - $4.3M.

 

Mrs. Nau reported that Early Intervention Programs are being prepared statewide and over half of those are in the Northwest.  They include Venango County, Jefferson County, and Lawrence County.  They include the City of Erie, Sharon, Meadville, New Castle, Oil City and Titusville.  Currently there are two communities in the Northwest who are Act 47 and that is the City of Farrell and the City of Greenville.  So in order to avoid turning into the cities of Farrell and Greenville, the Early Intervention Program is an important tool for this Administration to have to help guide in moving the City forward over the next five years.

 

It was moved by Mr. Peden, seconded by Mr. Mayer, and carried unanimously to accept the Manager's Report as submitted and place on file.

 

OPERATIONAL REPORTS - It was moved by Mr. Saintz, seconded by Mr. Mayer, and carried unanimously to accept the Operational Reports for the month of 1/06 (Police); 12/05 and 1/06 (Fire); and Finance (11/05 and 12/05) and place on file.

 

Mr. Peden asked the Police Chief for an update on how they are proceeding with the COPS Program.  Chief Simmons stated that the School Board tonight is supposed to be voting on whether or not they are willing to pick up the retention period or 9/12ths. of the Officer's salary during the retention period.  When the grant was originally written the Department had to have 15 Officers.  Through attrition in the last year, the Department has fallen below that number.  Without meeting the obligations of the grant there is one of two things that are going to happen.  Mr. Peden asked if that officer can be in that mix and be that 15th. officer.  Chief Simmons stated that the way the COPS Grant is written is you cannot hire the new person and put him in the Schools as the School Resource Officer.  You take an Officer you already have who is filling the School Resource Officer position.  The Grant is paying for the backfill to replace him as a street officer.  At this point in time we do not have that individual.  If we do not fulfill the obligation to that grant, they are going to send a letter in and review the City's finances and can either say yes you don't have the money and forgive it, or they are going to say you are not in that bad of financial shape.  You are either going to fulfill the position or pay back the money you've drawn down on the grant plus they will penalize you at which point in time the City would have to cut the Federal government a check.  The other alternative is to go ahead and move forward.  Hire the position.  Draw down the remaining money on the grant and at the time the grant expires the School District is going to pick up 9/12ths. of the School Resource Officer's salary for one year required retention period.   At that point, once retention period is met, then we are no longer obligated to fulfill the grant.

 

Mr. Peden asked where do they go from here.  Mrs. Nau stated that they are going to wait to see what the School District does this evening and then we'll come back and discuss where we go because we do not have a Civil Service list.  We are going to need to generate a Civil Service list eventually.   We do have retirements coming up in the Department.  Chief Simmons stated that it should also be noted that all grant funding for the City of Titusville, not just for the Police Department, falls under that grant number.  So if we don't fulfill that grant it is basically going to possibly axe all future federal money.  

 

Mrs. Nau commented that on all Department Reports she has asked them to include cost savings efforts that they have instituted in their Departments, and for the sake of the public, it might be nice if those were highlighted each meeting.

 

Mr. Peden asked for a copy of the December 31, 2004 Fund Account Balances.

 

MINUTES OF BOARDS AND COMMITTEES - It was moved by Mr. Mayer, seconded by Mr. Frye, and carried unanimously to accept the minutes of the Benson Memorial Library Board dated 11/15/05 and 12/13/05; Titusville Redevelopment Authority dated 12/5/05; Leisure Services Board dated 12/6/05; Titusville Renaissance, Inc. dated 11/9/05; Planning Commission dated 11/10/05 and 12/30/05 and place on file.