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MIN CC 05/02/19891 CITY COUNCIL MEETING MINUTES OF MAY 2, 1989 BOOK "P" 333 MINUTES OF THE HUNTSVILLE CITY COUNCIL MEETING HELD ON THE 2ND DAY OF MAY, 1989 IN THE CITY HALL COUNCIL CHAMBERS, LOCATED AT 1212 AVENUE M IN THE CITY OF HUNTSVILLE, COUNTY OF WALKER, TEXAS AT 6:45 P.M. The Council met in a regular session with the following members present: Jane Monday, Mayor Ila G. Gaines City Officers Present 0. Eugene Barrett William G. Green Gene Pipes, City Manager Gary Bell William L. Hammock Ruth DeShaw, City Secretary James L. Carter Percy Howard, Jr. Scott Bounds, City Attorney William H. Knotts, Jr. CITIZEN INPUT Mr. John Birkner. East Texas Folk Festival Mr. John Birkner, Chairman of the 1989 East Texas Folk Festival, advised the Council of the great success of the 1989 Festival and expressed his appreciation to the Mayor and Council for their volunteer efforts and to the city staff for all the work that was done to make it a success. He said while the final figures are not all in, it is estimated it will be even more successful than the first effort last spring. INTRODUCTION OF SPECIAL FOREIGN GUESTS Mayor Monday then asked Councilmember Gary Bell to introduce his special guests. Councilmember Belt! introduced Ahmed Mohamed Ghanem, Education Researcher, National Center for Education Research and Development in Ministry of Education for Egypt; and Ramokotudi Cecil Bodibe, Head of Student Services, Mamelodi Campus, Visti University, South Africa. Mayor Monday then asked the Council to join her as she presented them special greetings confirming them as Honorary Citizens of the City of Huntsville. Professor Judy Olson of Sam Houston State University introduced her special guests at the City Council Meeting, as follows: Takeshi Shimidzu, Vice President, Saitama Women's Junior College; and Shinichi Miyazawa, Professor, Saitama Women's Junior College. The Council again joined the Mayor in the presentation of special greetings of Honorary Citizenship to these two distinguished guests. Professor Miyazawa then presented the Mayor and Council a special Japanese beverage as a gift. CONSIDER BIDS Consider bid for H M.A C annual contract to Pavers Supply as indicated to be paid from C.I.P. street funds Mr. Pipes presented these bids for approximately 25,000 tons of Hot Mix Asphalt Concrete to be used by the street maintenance division and the capital street division in their maintenance operations for the next twelve months. He advised bids were taken F.O.B. City Service Center (vendor delivers) and F. 0. B plant. He said to determine the low bidders on the F.O.B. plant material, the staff has added $0.12 per ton to the base bid price for each mile from producers plant to the Service Center. He then recommended of the two bids received, that the bid be awarded to the low bidder, Pavers Supply Company of Huntsville, who has been furnishing H.M.A.C. to the city for the past several years. He said this bid price is $0.25 /ton less than the amount the city is currently paying, which will result in a $7,500 savings on the estimated 25,000 tons the city expects to use during the next year. Mr. Pipes advised this is the same company that opened their business all around the clock for the city crews to get more rock to place on the streets during the ice storm in early February. Councilmember Howard made the motion to approve of the bid of Pavers Supply and Councilmember Gaines seconded the motion. All were in favor and the motion passed unanimously. Consider bid for liquid asphalt to Gulf States Asphalt at $.6847 per aallon and Elf asphalt at S.70 per aallon as available. to be paid from maintenance and C.I.P. street funds Mr. Gene Pipes, City Manager, advised four bids were received for liquid asphalt for use by the capital construction crews. He presented the staff's recommendation of the two low bids as captioned. He CITY COUNCIL MEETING MINUTES OF MAY 2, 1989 BOOK "P" 334 said the only concern in awarding the bid to a single low bidder in this case is that Gulf States Asphalt stipulated a 24 hour notice, which is sometimes difficult to give if asphalt is needed at 8:00 A.M. the following morning, as weather plays a rote in this tight scheduling. Therefore, he advised it is the staff's recommendation that if Gulf States is unable to provide the product when the city needs it, the city will be allowed to purchase from Elf Asphalt at the 5.70 /gallon price, which would amount to an extra $76.50 on a 5,000 gallon toad. Councitmember Barrett made the motion to approve of both the two low bidders, as outlined above, and Councilmember Howard seconded the motion. Discussion: Councilmember Barrett asked where the two low bidders are located? Mr. Johnny Poteete, Director of Public Works, advised both are out of Houston. Councilmember Barrett asked why one can deliver without 24 hour notice whereas the other needed that time? Mr. Poteete said he did not know how many transport vehicles each one had. Mr. Pipes felt that if the company has two or three tank trucks and two or three jobs going at the same time, it would be a matter of scheduling trips and the other company may just have more trucks. Mr. Poteete said experience has been that Gulf States was only able to provide the city with one toad on one day when it needed two, so it got the second toad from Elf and it is because of this experience that this purchase arrangement is recommended. Councitmember Barrett asked that his motion be recorded to mean the city can order from both of these tow bidders, as deemed necessary. Mayor Monday then called for a vote on the motion. All were in favor and the motion Passed unanimously. CITY MANAGER'S REPORT - -GENE PIPES (Water line easement acquisition --HISD Mr. Gene Pipes, City Manager, said the city has an opportunity to bring a 12 inch water main from 10th Street up to 8th, across to 7th, and at the same time the consideration for the removal of an unused awning and the access easement through there to add another lane of traffic to University to expedite the flow of traffic around the School District for a very reasonable cost in conjunction with the planned street work. He then presented a series of pictures taken on University Avenue at 8th Street and over to 7th Street on the Mance Park Junior High campus at the West Wing building. He said the water line presently goes up six or eight feet behind the curb on University Avenue to the fire hydrant and then proceeds up to 7th Street where it is part of a 12 inch inner loop system. He said University Avenue is an offset street and this has been historically a problem even when it was the old state highway. He said the next block is inset about 15 feet which causes a water line problem. He said the water line lays parallel to the school awning- covered sidewalk on 8th street. Mr. Pipes explained the different views from the series of pictures as it concerns the lay of the land and the water line location in question. He said these photos show the problem the city has in keeping the water line there in its proper location, back of the street right -of -way, which will cause the city to go through the center of the overhang of one of the buildings. He said the city is proposing to HISD that they consider granting an easement so that this water Line can progress due north from the block below 7th Street on University over to 7th and go underneath the overhang of the metal frame school building, which overhang seemingly has no purpose now and perhaps could be removed, noting the school would have to remove that overhang. He said the School District maintenance and staff people see no problem with removing it. He said the trade -out that is being discussed with the School District is that the city would bring the curb line over to create a travel lane or parking lane to take the east side offset out of University Avenue, but there would still be an offset on the western side, and create a left hand turn lane especially on 7th Street where the traffic turns and goes back west. He said this would make a better traffic flow around the Junior High School. He said the city will be doing construction work there anyway and there will be approximately $12,000 additional costs to move this over, without any costs in removing the slab as the School District will be responsible for that. He said he wanted the Council to be aware of these negotiations. He said this particular project, being a utility project, gives the city the opportunity to straighten out a very long standing problem on one of the offset streets, and one that will carry a lot of traffic. He said as discussed in the transportation master plan earlier, if Sam Houston Avenue north goes all the way out to FM 247, then the interior circulation of having improved traffic flow on University would also be of benefit to the FM 247 traffic on Sam Houston Avenue. 1 u CITY COUNCIL MEETING MINUTES OF MAY 2, 1989 BOOK "P" 335 He said the deeds and records in this area are fouled up and the property lines, the streets, etc. occurred by virtue of the confusion that existed between the various instruments that were in effect. He said he does not know what the School District's thoughts are, but he wanted the Council to be aware of this before any information gets into the newspaper. The Council then expressed their positive consensus to proceed with this plan. Consider final elements of the draft comprehensive plan --Date Brown Mr. Pipes said the purpose of this discussion is to summarize all of the discussions had before and come back to the Council in the next couple of weeks with a final draft for potential approval. Mr. Dale Brown, City Planner, noted the water and sewer section is devoted to discussions of upgrading existing facilities, rehabilitation of existing facilities, and expansion of existing facilities to serve future populations. He discussed the 12 inch loop system and noted it is proposed that the city continue to work towards the completion of the 12 inch loop system. Mr. Brown proposed the 12 inch line be connected to the 12 inch that dead ends where the street dead ends behind the West Hills Mall and continue it through the Smither property, ultimately connecting to the 12 inch on the I -45 feeder road. He said the city then has a 12 inch that currently comes along Crosstimbers and continues out eastward. He said one of the major stretches of 12 inch left to do is from Crosstimbers to Walker Byrd Building Materials or the TDHPT building. He said there has been discussion about TDC renting their land in this area and each time that discussion arises, we discuss again the plan to extend this 12 inch because anything that is developed along the interstate there wilt need the water from this 12 inch line. Finally, he said on the Loop system, the city has a 12 inch water line along FM 2821 that dead ends essentially where the Henderson Land Company development ends and another segment of the loop to be completed would be to bring it over from FM 2821 and connect it into the Walker Byrd Building Materials site also, which would essentially complete the Loop. He said the city has a radial along with the loop system and in combination with it, it is talking about radial ties to improve the water circulation. He said currently there are 6 and 8 inch water lines out along Highway 75 North. At such time as the upgrading of 75N to four lane occurs, the city has been discussing a radial tie on the 12 inch that would replace the 6 and 8 inch lines because the city would have to move the water line out from the present location as it did with the line on FM 1374 to make room for highway) expansion. He said this would allow the city to expand it up to the radial tie to help the efficiency. He said this is the reason to mix this area between loop and radial tie because the city would propose that it would be built essentially from this point to this point because the highway would cover that whole area anyway. He said under the radial tie again an 8 inch to connect the 12 inch along 7th Street to the 12 inch on FM 2821 and some radial ties in and around the University area to help with general water flow and around the University to other parts of the city. He said the last segment radial tie is along Elks Drive. He said the city has a 12 inch that is coming from the Spring Creek Water Plant. Mr. Brown advised the city built a 12 inch on Montgomery Road as a result of highway construction and is proposing a connection of the 12 inch at Elks Drive down to the 12 inch at the Interstate. He said these are the proposals for the long term expansion of the internal water system. Mr. Brown said the other thing he is suggesting is to keep in mind as the population grows is the master plan scheduled upgrades for the TRA surface water treatment plant, and the city's two sewer treatment plants. He said the city is basically on schedule as it has had upgrades in the south sewer plant. He said the north sewer plant is not scheduled for upgrades in the near future as it is still at approximately 65 percent capacity. The TRA plant is scheduled for upgrade in 1993 or 1995 but that is on a look- and -see basis, Mr. Glenn Isbell, Director of Design Engineering, reported. Mr. Brown noted when the population gets to the point where it is time to start looking at the upgrade for future development, the city's alarm will sound to give it a couple of year's advance notice so it can be designing and building so it is not without the capacity by the time it needs it. Councilmember Carter said he just took a class out to the wastewater treatment plant and noted there is a large volume of water the city is sending out of those treatment plants into the streams. He said it seems to him we would almost have enough water out of the treatment plants that we would not have to upgrade CITY COUNCIL MEETING MINUTES OF MAY 2, 1989 BOOK "P° 336 he TRA plant if we made use of it back into the water treatment system. Councilmember Green noted that ater would be better than the water we get into the plant initially. Councilmember Carter said every class e has ever taken there is happy with the idea. Mr. Brown said this has been discussed over the years. Mr. oyd Wilder, Director of Public Utilities, said the main idea concerns the volumes that are involved, even hough it is clean water, we still have to go through a water treatment process, so we either build another reatment process there or we pass it to an existing treatment process. Mayor Monday noted some day this ay be an option when we begin to investigate expansion of the system. Mayor Monday noted 60% of Harris ounty's water supply is recycled. It was noted the Bedias reservoir concept has been shelved temporarily. r. Pipes said while it is on hold for now, the initial study has been completed and it is feasible and it ill produce water and it will have a positive yield, but there aren't sufficient customers at the present ime to need the reserve. Councilmember Carter asked that a statement be included in the master plan that art of the long range plan so people can become familiar with the idea. He said if people really object to t, they can come down to tell us they don't want it in their plan. Mr. Brown then reviewed some of the maps concerning capital improvements. He noted the council unded $100,000 a year to eliminate the presently unsewered areas within the city limits. He produced a map repared by Mr. Isbell of those nonsewered areas. He said in many cases they are small, say two to three ouses in small bunches. He said in some cases, the map is a little distorted. He said the largest f FM 1374. He said one place recently completed is the church property across from the Goree Unit, which as one of the identified areas. He said three additional areas will be provided sewer through the ommunity Development Grant - -FM 247 (Midway Road); Watkins Street /Ryan Ferry Road; and Pine Hill /Montgomery oad (FM 1374). At this point, he said, from examining all the areas, these three areas are about the last reas eligible for funding through a grant as sewer projects. He said we have to have a minimum 60% of ow /moderate income and at every one of the other places needing sewer, the income levels are sufficient hat they are disqualified, based on the 60% level. He said once we finish the present grant, we will have o look at other options; i.e., going outside the city limits to annex new areas that aren't sewered, or we an look at water areas, which will probably be limited because it has been found there are very few areas n town that do not have water as that has always been the least expensive to extend. The other area in hich grants can be acquired concerns housing rehabilitation, but that area rarely gets funded, he said. Mr. Brown said the Council's suggestion on how to handle the money that it is funding for these non red areas was to look at it in sort of a ring configuration, from the center of the town, so that the s that have been in the town the longest would be the first ones we would approach to solve the problem we would then work our way out. Mr. Brown said the staff will work with the Council on some more time rather than sotely on which one is in the city the longest. He said one thing to consider, which be more than the E100,000, is that since we are having the grant project in south Huntsville, we may to consider Majestic Forest's need for sewer at the same time and essentially take care of this whole He said the city may want to look at some of the small areas very quickly, but that can be worked ugh this summer as we budget. Mr. Brown advised the Council that sewer problem areas need addressing which are either above their apacity or the sewer line is on such a minimum slope that it is, in some cases, dysfunctional at least some f the time. He said in times of low flow, it is essentially not flowing until it builds up enough water. r. Brown said in the old days one could run a private line to get city sewer and that practice was ncouraged by the city. He said at this point, we are getting to where it is difficult for the property wner to continue to maintain the extremely long private lines and they are coming to the city wanting ssistance. He said while we are looking at upgrading the sewer map to include situations like that, in I fl L CITY COUNCIL MEETING MINUTES OF MAY 2, 1989 BOOK "P" 337 many cases, it is going to be as a result of complaints, or just on a lot by lot examination basis, because the city does not know how many are a problem until they are brought to its attention. Mr. Brown noted as the city expands, it will have to look in the area of sewage treatment at more than the two existing sewer treatment plants He produced a map of the drainage areas, noting each is a totally different drainage area and theoretically the sewer systems would function best with individual sewer treatment rather than have the multiple lift stations we now have. He said the city has discussed in depth the Robinson Creek proposal and we are leaving that to the future with the understanding that our ultimate development will allow for more sewage treatment plants. He said it is possible that the south sewer treatment plant is almost at its maximum design while some additional expansion could Perhaps be made. if any major additional caoacity on the south side is needed the city should start considering shiftina some of the sewage that is going to the South Plant over to Robinson Creek and doing away with some of the lift stations. He said there are three lift stations just to get the sewage to the treatment plant in one case. Mr. Brown said the staff wants to bring to the Council in the CIP program, specific projects it can define by cost and by time. Mayor Monday asked if the CIP will be ready by July. Mr. Pipes said it will come forth with the budget. Mr. Brown said this concludes his comments on the comprehensive plan. He said he has been trying to internally balance the plans between the expansion of the system to serve new or future development and the needs to rehabilitate the aging existing infrastructure. Linda Pease to discuss Goal 6 of the Comprehensive Plan concerning the cultural activities in tourism Ms. Pease spoke regarding the section in the comprehensive plan dealing with providing supporting facilities to individuals and groups sponsoring cultural activities in tourism - related events within the community. She brought to the Council's attention a goal and some objectives which were formulated by the Huntsville Arts Commission. In 1985, she said, it was required that the Arts Commission design a three year plan in order to be considered for a grant it had just gone through culminating in activities and designs for downtown. Prior to that, she said, there was one overall goal that had been accepted by the city which was that the Huntsville Arts Commission is to support, encourage and nourish an environment for the growth of a broad range of the arts in Huntsville with the aim of integrating such art into the total life of the community. She said when they formulated their plan four specific objectives were developed by the Arts Commission and incorporated into that proposal: 1. to encourage an increase of quality arts programs providing for school age children; 2. to stimulate cultural diversity in local arts programs; 3. to create ways to involve more senior citizens in audiences for the arts; and 4. to provide an orderly plan for the acquisition of visual arts for public display. She said the recommendation is that this wordina be incorporated into the wording of Goal 6 of the Comprehensive Plan. She said the Arts Commission has recently agreed to continue these goals. She said there is a backup plan to achieve those goals which she can make available. Mayor Monday then asked Mr. Brown to prepare a final draft of the comprehensive plan for adoption. Audit Committee to Meet Mr. Pipes asked that the audit committee plan to meet some time next week for the purpose of scheduling a review of the city's audit for next year. He said proposals will need to be solicited and in order to get this done in a timely fashion, the auditor will need to be designated by this summer so preliminary work can begin. CITY COUNCIL MEETING MINUTES OF MAY 2, 1989 BOOK "P" 338 Mr. Pipes advised the city has been considering the employee retirement program and has made a uple of overview type presentations, and subsequently responded to questions raised at that time. In dition, the City has brought the representative from the TMRS to answer any questions the Council may have that program. He said last week the city responded to a series of questions that were provided. Thus r this week, he said, the city met on Friday morning with the retirement committee to gather up any estions they had been provided by any of the employees during the previous two to three weeks and sponded to several questions at that time. He said none of the questions were particularly surprising or sconcerting and although the city feels it has answered all of those questions, he did indicated to the unit last week that this item would be back on the agenda this week for discussion prior to formal action xt week. He asked that any additional questions be asked at this time so that answers can be provided fore the item comes back for formal approval. Discussion: Councilmember Carter asked if ICMA has portability. Mr. Pipes said it is very portable s it is a 401a plan and when one terminates, it goes with the employee as it is a lump sum disbursement. e said it is portable from the standpoint that one can leave it in there and if one goes to another city nd they have ICMA, it can be transferred. He said it is not portable in the technical sense of transfer redit, but rather, it belongs to the employee as an individual. Mr. Scott Bounds, City Attorney, said ears of service will not transfer with the ICMA plan. He said the money the employee is vested to is ubject to lump sun distribution or he can roll it over into an IRA. Mr. Pipes said that is the portability eature. Councilmember Carter noted then portability is not an advantage TMRS has over ICMA. Mr. Pipes Councilmember Green asked if one is in an ICMA city and then goes to a TMRS city, what is the fference between that and what the city is proposing, in the sense that the city says we have a plan now d it is not portable into TMRS, but when we come into TMRS the employee will get prior years' service edit? Mr. Pipes answered "No," in that the employee only gets prior years' service credit when he starts e program. He said if he, as an employee of the City of Huntsville, were to go to another city that is a RS city, he would not get his experience with the City of Huntsville. Mr. Bounds said he would get that edit only if the new city adopted the TMRS program for the first time after he started to work there as is is the only time p2rior service credit is in effect. Mr. Pipes said this feature would not exist in y other set of circumstances. Councilmember Green asked with regard to the point at which we choose to retire, what sort of ptions does an employee have at that point with regard to what he can do with his money? Mr. Bounds said here are six alternatives and all of them involve some type of annuity. He said he can take a straight ife annuity, a combination straight -life annuity, guaranteed ten year payout or fifteen year payout. He aid one can take a joint life annuity (employee and spouse) and there are a couple of variations on that. e said the feature that has to be taken with any of these combinations involves an annuity over the mployee's life time. Mr. Pipes said an employee can take a ten year payout annuity. Councilmember Green hat money administered and paid out by someone else who may be better. Mr. Bounds and Mr. Pipes said that s correct, the employee would be fixed in this regard with TMRS. Mr. Pipes said the only flexibility the urrent employees would have would be with the money they have in the current fund (Kansas City Life) and hey can roll that into an individual IRA or some other type of system and have accrued interest over that ime and that could be contracted as an annuity. Councilmember Green asked if any of the options available to the employee at retirement make an Ltowance for his children if he, or his spouse, does not use up all of the benefits when they die? Mr. ounds said on the combination joint annuity, ten year payout, there is a combination joining the employee's ife annuity payout to ten years to a trust and some type of arrangements could be made to provide for that. 1 1 CITY COUNCIL MEETING MINUTES OF MAY 2, 1989 BOOK "P" 339 Mr. Pipes said that would be just taking the annuity at such a rapid rate that one would be accumulating surplus beyond the living expenses to exhaust the fund in ten years. Mr. Glenn Klussman, Local Agent, Kansas City Life, asked if he could speak at this point (behalf of Kansas City Life]. Mr. Klussman was recognized. He then said that last statement really does not apply because if the employee takes a ten or fifteen year option, the joint survivorship pays as long as each one person lives. He said if both spouses die within a two year period, their money will still be made available within a ten or fifteen year period and they are not penalized that much for taking the joint option with a ten year period. He said if the employee has $200,000 and he and his spouse die in two years, the children will still get all of that money under a regular annuity. Mr. Bounds said this is not a regular annuity in that sense. Mr. Klussman said he knows what TMRS does as he used to be a councilperson in Brenham. He said while TMRS is a good plan, one of the other things that bothers him is that if he had $200,000 and he retired at age 65, he would want the best type of annuity available. He said right now Manufacturers Mutual has that. He said he is not placing the renewals of his annuities with Kansas City because they are a little under Manufacturers Mutual. He said he did a test on a person in another town and on $137,000 on today's market, the man being 65 and the lady 68, there was $101 difference per month for the rest of their lives. Mr. Bounds said in this regard, he would have some doubts as to whether Mr. Klussman properly) calculated the TMRS projections. He said generally when we get to the projections of TMRS, the only thing they will guarantee is the 5% annuity rate, which is the minimum provided by statute. As a matter of policy, he said, they have paid an additional two and one -half months annuity. He said the effective rate is very competitive with what you will find in the open market. He said they will pay the absolute best annuity rate. He said the annuity rate they have paid out has been a very good annuity rate based on past history. Mr. Klussman asked what those rates were. Mr. Bounds invited Mr. Klussman to come by his office sometime to see the information he has on all of the payouts. Mr. Bounds said that is just one factor in the overall evaluation of the plan and to indicate that he looked at an individual's retirement package, without looking at how much money they have actually put into the plan and what they are paying out, it is very hard to come up with just a side- by-side comparison. Mr. Klussman said it really isn't because if you have two people and they are both 60 years old and you have $200,000, it is easy to determine. Mr. Bounds said given the way the TMRS system works, one is credited for money in his account to begin with that he does not necessarily put into the account. He said there is a lump sum value at the end- -the amount of money the employee actually had to put into the plan, to come up with that lump sum value and that will vary on a TMRS plan to a standard 401 plan in order to come up with the same lump sum value from which one starts out calculating the annuity. Mr. Klussman asked if the council understood that because he didn't. Mr. Bounds asked Mr. Klussman if he understands the prior service credit and updated service credit provisions of the TMRS plan? Mr. Gene Pipes. City Manager, advised he did not think it is appropriate that this discussion continue under this format from the standpoint that if Mr. Klussman or any other private provider wants to discuss any aspect of this plan he and Mr. Bounds do have office hours and the council is certainly available. but this is intended to be a discussion of questions from the Council. Mayor Monday then asked if any of the council had additional questions. Councilmember Knotts said he is either not very knowledgeable about insurance matters or insurance matters are lust very complicated. noting the city has hired consultants for telephones. etc. , and he would just feel more comfortable if the city had an independent consultant to really go through and study this to help the city figure out what is best for the employees, best for the city, and best for the citizens. He said the only thing that really bothers him is that we have to go back and pay prior credit. He said it is going to be rather hard to explain to the citizens. He said if the city has a few thousand dollars it can pay a consultant in this particular field that could explain and explore all of the possibilities of everything involved, he would feel better about it, noting it is just too complicated for the Council to take on face value to really solve. Councilmember Carter felt this to be a good idea, noting it has not CITY COUNCIL MEETING MINUTES OF MAY 2, 1989 BOOK "P" 340 come up before. He was concerned about the time table and how rushed we may be at this point. He said without expressing any dissatisfaction or lack of faith in the people who have been representing the programs to the Council, they are probably not independent as they are part of the process and will be recipients of the program. He said he is not at all opposed to a consultant if there is money and there is a possibility of doing this with an independent expert who would be available. Mayor Monday noted then the question is whether there is a time frame. Councitmember Green felt he didn't know if the consultant is the thing to do at this point, although it may have been a good idea three or four months ago but it is perhaps not feasible to do now. Mayor Monday asked if he felt the staff should take a look at this and bring back their recommendation next week. Councilmember Green noted it may be worth everyone's satisfaction if it could be done relatively quickly and inexpensively and he didn't know how much money this will require or the time table. He said for those reasons, he is reluctant to suggest one way or the other. Councitmember Barrett asked the City Manager about the time frame, noting none of the Council is able to make a decision along this tine and it has received a lot of information, but the bottom Line is what the employees want. He said they have all been able to study it and have gone into it indepth. He felt if they are happy with it, the Council should consider their recommendation without an outside opinion. He said the opinion is no better than the person one gets to give it. He said if we have someone available who would be unbiased, he would not mind having them do it in a quick manner, however, to draw this out any longer concerns him. He felt we have gone into this in detail and while none of the council are insurance people, they to want what is best for the employees. Mr. Gene Pipes, City Manager, said while he does not want to be defensive, many hours of work have obviously been spent in this process. He said the committee was selected last fall to review the current program because the ten year contract was up and there had been some very unusual changes in that initial program in the last couple of years that had subsequently created some administrative problems for the city. He said the committee began its program of work by soliciting proposals from anyone who had anything to offer from the private sector and the public sector. He said a number of things are involved in any decision. He said any actuarial or insurance based program is very complex and it is basically an individual type thing, employee to employee and it changes on an employee to employee type basis. He said one or two points on the annuity rate will get a sometimes substantive difference in the monthly payout, etc., noting there are all kinds of factors involved. He said the committee felt it had not exhausted all of the companies that were available in the private market, but felt having a presentation by the current carrier. Kansas City Life: three other insurance companies: the TMRS• and ICMA [which is an independent non - profit administrator of retirement funds], that the committee had covered the spectrum He said Councilmember Knotts is right as there is not a soul on that 18 member committee that will claim to be totally neutral and unbiased because each one of the committee members are members of the retirement program so there is a vested interest on their part in the outcome and seeing to it that it is the best possible solution among all that is available. He said the committee members did try very diligently to be as objective as possible. He said a minority report was requested by Councitmember Bell, however because of secret ballots so as not to put pressure on anyone, a minority report would not be available. He said while there was a split vote in the process of making an interim report to the Council, there were some other opinions, among which may have been staying with Kansas City, but he does not know. He said the vast majority of this study committee did concur with the recommendation he presented to the Council some six weeks ago. He said since that time there has been some question as to whether there are any other opinions out there, and he is sure there are some employees whose individual circumstances do not fit the generic idea of the pension plan under TMRS. He said some would be advantaged more than others. Mr. Pipes said he didn't know that there aren't independent retirement actuaries out there, but mostly, they represent some plan or other, or some company or other, or some program type on which they will be glad to provide information. Mr. Bounds said when one tries to evaluate different types of retirement systems, how one ends up evaluating them is going to be relatively difficult. He said one can look at their historical performance, 1 1 CITY COUNCIL MEETING MINUTES OF MAY 2, 1989 BOOK "P° 341 but that is not going to necessarily guarantee how they are going to perform in the future. He said we can Look at their current performance and that may be only related to their historical or their future plans. He said one can just simply describe their differences between the systems and look at the different systems to see if they have a history that has been satisfactory and evaluate them in that mariner. He said that is primarily the method the committee used. He said one can go through dollar comparisons of TMRS versus a 401 plan. He said one can look at historical earnings rate with insurance companies. He said while some use a blended interest rate, some do not, so it depends when one gets into the system what interest rate they earn. He said they use a net fee or a gross fee. He said when one gets comparable things down on paper, the TMRS and ICMA were competitive on the annuity rate. He said they recognized that small differences in the annuity rate will make a big difference in what one would ultimately receive in retirement benefits. He said it is difficult for anyone, and no one will, at the present time, guarantee what the annuity rate will be five or ten years from now. He said the life tables that a company uses will have a big influence on the annuity rate. He said there are several different factors that come into play in that calculation. He said the committee evaluated the TMRS system and the ICMA system and determined they were both good systems, designed for municipal type situations. He said they evaluated them from an employee benefit standpoint and from a city cost standpoint - -how much it is going to cost the city as an entity to have that type of retirement system. He said he talked to an attorney that specializes in termination and evaluation of benefit programs, who could provide the Council with a list of disclosure items, problems and potential long term problems with the different systems and costs. Mr. Pipes said this is one area he is intentionally leaving out. He said the most major thing common to all plans is the tax impact situation. He said the city has been talking to Mr. Ken Davis, City Auditor, to determine, through some change or circumstances in the current tax laws, if we would result in unintentionally and inadvertently handicapping someone's financial position. He said Mr. Davis is presently in the process of reviewing that sort of thing for the city. Mr. Pipes said Mr. Davis is not going to be in a position, nor is any CPA or anyone else, to pass judgment more effectively than is the committee the city had on whether ICMA or TMRS is better or worse, because we are talking about a future condition twenty years hence, and while past performance is an indicator, it is no guarantee. He said virtually all of the insurance companies presented to the City had very good program features, such as loans, etc. Mayor Monday surmised then that Mr. Bounds and Mr. Pipes do not feel it is possible to get independent consultants to analyze the programs and present them to the Council. Councilmember Knotts clarified that he was not wantina to aet an analysis of the program on which one would produce the most. but what he was asking is that we try to take what we have today and incorporate it into what we want. He said in the event that the city sometime may be required to get back under the social security program. then of all of these possibilities what would be the best course to take today. Mayor Monday stated then the consultant would make that recommendation. Councitmember Knotts said the consultant would recommend the _best long term retirement program that we could have instead of lust wiping the slate clean and starting over. Mr. Bounds said an attorney can be hired. Councilmember Knotts noted there are one or two in Austin that can do this as they are estate planners and this is their profession. He said he is trying to get the best thing for the employees at the least cost to the City of Huntsville. Mr. Bounds said he is sure we can find someone to do the work: but feels they will end uo basically duplicating the work that has been done and redoing what the city has spent six months doing. Mr. Pipes said the time line is such that the city was targeting due to the administrative budget season to try to complete action by June 1 so that this process does not go on into the summer budget process. He said obviously the discomfort level is such that this schedule may not be practical and we may be doing this in July and August. Councilmember Knotts clarified that we are not losing what we have now. Mr. Pipes said we are just paying into the current program, that may be disbursed in the near future, on a monthly basis, money that the city doesn't need to be paying. He said that is, as a practical matter, the only reason to go ahead and conclude the relationship with Kansas City Life and move on to another program. Councitmember Bell said he has been one of the most persistent questioners throughout this whole program, but he is wondering, as he listens to Councitmember Knotts' proposal, whether the person we hire CITY COUNCIL MEETING MINUTES OF MAY 2, 1989 BOOK "P° 342 Ad be duplicating the kinds of work that Mr. Bounds has already done. He said we pay a fairly healthy Lary to the City Attorney on an annual basis, and he suspects much of his time over the last couple months s been spent analyzing retirement programs in order to come up with an independent conclusion on what he inks would be best for the city as well as for the employees. He asked if perhaps we don't already have e expert, but the fact that he is a current employee may make us just a tittle less accepting of the kinds recommendations he is making. He said this is just a thought that is going through his minx) that he nted to throw out here. He asked Councilmember Knotts what he thinks about that. Councilmember Knotts said that is fine with him, but he is just so unknowledgeable about insurance n terms of annuity matters and he always felt comfortable in his own personal experiences if he found omeone that was an insurance salesman and someone that would really try to get the best program. ouncilmember Barrett said he agrees with Councilmember Bell that the city will reinvent the wheel if it eeps going back to review things that have already been covered. He said he didn't want the City of untsville to be taken advantage of on this program, but certainly the people who have been doing this esearch are not going to let something slip when it affects them personally. He said this TMRS has 549 ities in its program, so there is certainly safety in numbers. He felt the city may be spending money selessly when all of this research has already been done. He said we do not have to come to a conclusion onight, but he feels this thing has been investigated indepth and he didn't feel the city needed to find nother person to give it another opinion to confuse it more. Mayor Monday advised there is a question on the floor as to whether or not to ask the staff to said before she gets a consensus on that, she asked if there are any other questions of the Council. MAYOR'S REPORT - -JANE MONDAY Mayor Monday presented an invitation from the TRA General Manager, Mr. Danny Vance, for the Mayor nd Council to go to Arlington to tour the TRA headquarters. She noted he will send transportation to untsville to get the Council. She encouraged the Council to take this opportunity to have an overall view f the TRA operations throughout the region. Several dates will be set that might be appropriate for the ouncil to consider, she noted. Mayor Monday advised Mr. Glenn Isbell, Director of Design Engineering, volunteered to take the ouncil on a tour down from Bedias by canoe or motor boat to the inlet structure so that the Council can see t. She said suggested times will be scheduled soon. Mayor Monday advised the TAC is concerned about funding for the state and for the aeronautics ram. She said the City was recently awarded the Outstanding Model Aviation Award for the Huntsville cipal Airport. She said House Bill No. 2812 will be introduced tomorrow by Representative Russell from nI �J 1 CITY COUNCIL MEETING MINUTES OF MAY 2, 1989 BOOK "P" 343 aviation education. She said the TAC has asked for Huntsville's support of this legislation. With the Council's Permission. she said. she will write letters requesting Huntsville's legislators to support this house bill. The Council asked questions for clarification and then indicated they had no objections to Letters of support in this regard. Southland Conference Spring Festival Mayor Monday advised she represented the City at the Southland Conference Banquet at Waterwood Friday night. She said she visited several of the Presidents and the Athletic Directors at this function. She said overall the participants felt they had a very good conference here and were very positive about the City of Huntsville and the Tourism Division's response. The Tourism Division prepared baskets decorated in orange and white, containing Huntsville memorabilia and mini -gifts which were placed in all of the rooms, she noted. Advertising was done for the Conference all over town and the Southland Conference as a whole received a very warm reception, Mayor Monday reported. Sam Houston Distinguished Alumni Banquet Mayor Monday advised she represented the City at the Distinguished Alumni Banquet at Sam Houston State Univesity on Saturday evening. She said she had a chance to visit with U. S. Congressman Charles Wilson, who was among those being honored. Reception for Visiting Foreign Educators Mayor Monday advised she attended a reception last evening for the visiting foreign educators. She said they are visiting around the United States and have been in Washington, Los Angeles and are now in Huntsville to look at various education systems. She said they will be considering those education ideas to use in their own countries. She said it was very interesting to hear their perception of our American education system and some of the ideas they are going to take back home. She encouraged the Council to take the time to visit with them before they leave. National Nurses' Dav Mayor Monday said this morning she proclaimed May 6 as National Nurses' Day. Lunch with State Comptroller The Council was advised the Mayor had lunch with State Comptroller, Bob Bullock today. The Mayor said he has launched his candidacy for Lieutenant Governor and spoke at the Courthouse this afternoon. She said they talked about financing and he was very encouraged with the budgetary figures and what he is seeing coming out of Walker County. He feels we are definitely on the recovery, she said. Highway 19 Association Meeting in Athens Mayor Monday asked the Council to try to schedule to go with her and Mr. Pipes to Athens on Tuesday, May 9. to attend the next meeting of the Highway 19 Association. She said it will be a good opportunity for the Council to meet with the other groups who are working with Huntsville. She said Mr. Tom Randle will be sworn in as President of this group and Mr. Gene Pipes will be the Secretary of that group. She said they will leave at 9:00 A.M. and return around 4:00 or 5.00 P.M. CITY COUNCIL MEETING MINUTES OF MAY 2, 1989 BOOK "P" 344 COUNCIL ACTION Councilmember Bell asked that a third field trip be scheduled for the Council to look at the inage problems in the city, especially near the Diagnostic Unit and at the railroad sour. Mayor Monday d this trip can be scheduled as well. Councilmember Carter advised he has received an anonymous letter suggesting an environmental impact tatement should be prepared concerning the effect of the University's concrete laying activity on the nvironment. Councilmember Carter said he didn't know how these impact statements apply to Sam Houston tate University or even if they do, but he is raising the question again as the city is facing drainage roblems and Sam Houston State University may be causing some of the biggest problems. He said sooner or ater Sam Houston has to realize this, if they want to continue to be a good neighbor. Mayor Monday said he City will be working with them as well as the Texas Department of Corrections to work out the pportunities we have there to maximize the usage of the land for all of us. Councilmember Knotts encouraged the Council to travel through Palestine on their trip to Athens on uesday rather than take Loop 256. He said Palestine is as old as Huntsville and he encouraged them to go hrough the old part of that city. He said they have adopted zoning and he wanted them to see the Mayor Pro tem Howard advised he presented a proclamation at the Green Acres Nursing Home on Saturday behalf of the City to promote the Junior - Senior Games program. ADJOURNMENT Respectfully submitted, Ruth DeShaw, City Secretary May 2, 1989