City Council

Minutes from the Petersburg City Council Special Called meeting held on: July 11, 2017 -1– ______________________________________________________________________________ The Special Called Meeting of the Petersburg City Council was held on Monday, July 11, 2017, at the Union Train Station. Mayor Parham called the Special Called meeting to order at 6:30p.m. 1. ROLL CALL: Present: Council Member Charles H. Cuthbert, Jr Council Member Annette Smith-Lee Council Member W. Howard Myers Council Member Darrin Hill Vice Mayor John A. Hart, Sr. Mayor Samuel Parham Absent: Council Member Treska Wilson-Smith Present from City Administration: City Manager Aretha R. Ferrell-Benavides City Attorney Joseph E. Preston Executive Assistant to City Manager Stephanie Harris 2. CLOSED SESSION: City Attorney Joseph Preston stated that City Council will now move to go into closed session for the purpose pursuant to Section 2.2-3711.A (1) of the Code of Virginia, 1950 as amended, Council will be in closed session for evaluation of City Council appointees where the evaluations would involve the discussion of the performance of specific individuals; and pursuant to Section 2.2-3711.A (29) of the Code of Virginia, 1950 as amended, Council will be in closed session to discuss the award of a public contract, involving the expenditure of public funds, including bidders or offerors and discussion of the terms or scope of such contract, where discussion in an open session would adversely affect the bargaining position or negotiating strategy of the public body. Council Member Hill moved that the City Council go into closed session for the purposes noted by the City Attorney. The motion was seconded by Vice Mayor Hart. There was no discussion on the motion, which was approved on roll call vote. On roll call vote, voting yes: Cuthbert, Smith-Lee, Myers, Hill, Hart and Parham; Absent: Wilson-Smith City Council entered closed session at 6:31 p.m. CERTIFICATION: Mr. Preston stated that City Council now moves to come out of closed session and certify that only public business matters lawfully exempted from an open meeting requirement pursuant to the Virginia Freedom of Information Act and only such business matters as were identified in the motion by which the closed meeting was convened were heard, discussed or considered in the closed meeting. Council Member Hill made a motion to return City Council into open session and certify the purposes of the closed session. The motion was seconded by Council Member Cuthbert. There was no discussion on the motion, which was approved on roll call vote. On roll call vote, voting yes: Cuthbert, Smith-Lee, Myers, Hill, Hart and Parham; Absent: Wilson- *Audio available  Minutes from the Petersburg City Council Special Called meeting held on: July 11, 2017 -2– ______________________________________________________________________________ Smith 17-R-43 A RESOLUTION CERTIFYING, AS REQUIRED BY THE CODE OF VIRGINIA, SECTION 2.2- 3712, THAT TO THE BEST OF EACH MEMBER’S KNOWLEDGE, ONLY PUBLIC BUSINESS MATTERS LAWFULLY EXEMPTED FROM OPEN MEETING REQUIREMENTS OF VIRGINIA LAW WERE DISCUSSED IN THE CLOSED SESSION, AND ONLY SUCH PUBLIC BUSINESS MATTERS AS WERE IDENTIFIED IN THE MOTION CONVENING THE CLOSED SESSION WERE HEARD, DISCUSSED, OR CONSIDERED. Council Member Myers made a motion to authorize the City Manager to direct the Operation and Purchasing Manager to enter into an emergency procurement pursuant to Petersburg Section 2-393 and Virginia Code 2.2-4303F for Emergency Procurement to reserve the interest of the City to maintain proper functions of the government to maintain the official rendering of public service and start negotiations and development of contract documents with the International Association of Assessor’s Office (IAAO). He stated that the contract should not exceed $90,000, including expenses. The motion was seconded by Vice Mayor Hart. The motion was approved on roll call. On roll call vote, voting yes: Cuthbert, Smith-Lee, Myers, Hill, Hart and Parham; Absent: Wilson-Smith Council Member Hill made a motion that City Council approve amendment #2 of Contract #17-003 between the Robert Bobb Group LLC and the City. He stated that this second amendment approves continuation of Tom Tyrrell services as Interim City Manager during the period of July 1, 2017, through July 14, 2017, which add an additional $10,000 to the July 31, 2017, enforce. He stated that this amount shall come from the contingency fund. He stated that City Council shall direct the City Manager to direct and allow the City’s Operation and Purchasing Manager to finalize and execute the second amendment to contract #17-003 to modify purchase order #17290 and to finalize the necessary change order documents on behalf of the City. The motion was seconded by Council Member Myers. The motion was approved on roll call. On roll call vote, voting yes: Cuthbert, Smith-Lee, Myers, Hill, and Parham; Absent: Wilson-Smith; Abstain: Hart 3. PURPOSE: a. Consideration of an ordinance to create position of collector of City taxes for the City of Petersburg. BACKGROUND: On May 6, 2017, the City Council passed a resolution to immediately direct the City Manager to implement a process to recruit suitable and qualified individuals to be considered for appointment by Council to the position of Collector of City Taxes. It is council’s intent to appoint a Collector of City Taxes as soon as feasible. It is proposed that the Collector of City Taxes collect all taxes and assessments which may be levied by the City of Petersburg. RECOMMENDATION: Recommend City Council approve the ordinance to create the positon of the Collector of City Taxes. Mr. Bobb gave an information on the Tax Collector position and information on an option with the finance department taking on the collection of taxes for the City. Council Member Cuthbert made a motion that City Council enacts the ordinance that City Council has before them to amend and re-ordain the 2000 code of the city of petersburg by adding division 7 to article iii of chapter 2 of that code, such division entitled “collector of city taxes”, such division prescribing the authority, duties, and functions of that office; and amending those sections of that code that place billing and collection functions with the treasurer by placing such duties with the collector of city taxes. The motion was seconded by Council Member Myers. *Audio available  Minutes from the Petersburg City Council Special Called meeting held on: July 11, 2017 -3– ______________________________________________________________________________ Ms. Harris opened the floor for public comments. Gloria Brown, 1557 S. Sycamore Street, stated that she was looking over the document. She stated that she had a couple of questions that she continues to ask in a City that claims that they do not have money. She asked what is the real number of this line item being created. She stated that they are talking about a tax collector. She stated that two employees were just eliminated in the department. She stated that in reading the document she sees that the position is also open for deputy. She stated that the deputy has to have a salary. She stated that this is $110,000 for the collector plus the deputy salary. She stated that they would need staff to do the collecting. She stated that then they would have to set up an office and infrastructure. She asked what is the true number of the line item that they now have to put in the budget for new position. She stated that what people need to realize is that the City Treasurer still has to be in place. She stated that this is just adding up and adding up. She asked what the true number to move forward. She stated that this is her only issue. Samuel Rhue, 1952 S. Westchester Drive, stated that his concern is on the City Tax Collector. He stated that currently they look at the budget that was approved for FY18. He stated that the City has $72 million in revenue and that this is not including the liquidity part. He stated that $50 million dollars of that money comes from real estate taxes, personal property taxes and fees. He stated that they have proven in the City that they are not good at cash management and collecting taxes. He stated that they cannot go through the year without collecting almost $50 million dollars in real estate and personal property taxes to make the budget. He stated that from his experience and from what he sees here is that they do not have the technology and that they may not have the skill set. He stated that the City does not have the staffing in order to collect the funds. He stated that a tax collector is where they need to be because they cannot take the risk of not having a budget in 2018. He stated that it is imperative that they meet the numbers in the revenue side. He stated that a majority of the money comes from taxes and that they have to move forward with this. Richard Stewart, 129 Rolfe Street, stated that it is his concern that when he goes into City Hall that it is like an antique shop. He stated that everything is old. He asked if the firm is going to bring 21st Century computers in the office and move the City through. He stated that right now everything is so ancient. He asked are they going to eliminate the jobs of the clerks that are currently in the office. He asked are there going to be two people standing at the window. He asked how is the reconstruction going to be. He asked are people still going to have their jobs or are the contractors going to come in and take over. He asked which contract are they are going decide on because there were three different contracts. He stated that they all have three different ideas. Michael Packer, 1245 Woodland Road, stated that he speaks in favor of the ordinance that is before City Council tonight. He stated that from a historical perspective he believes that it was in the late 1970s when the City Collector retired. He stated that they had a City Collector for many years prior to that. He stated that after that time the City Treasurer came to the City and said that they believe that they can perform the duties of the collector and that treasurer and save the City some money. He stated that this person went on to say that if they could not perform their duties then they can appoint a City Collector. He stated that as City Council may know that in the Charter the City Collector is one of the five positions that the City Council appoints and supervises. He stated that they are at the point that they need to appoint a collector. He stated that he got his water bill on yesterday. He stated that he pays his water bill the same day that he gets. He stated that he pays it electronically on the computer and the bank somehow sends the money to the City. He stated that yesterday he got his bill for two months. He stated that the reason is that the payment somehow on the date that he received the bill and paid it did not get processed. He stated that there is not penalty for it. He stated that he knows of at least two or more examples of real estate taxes not being posted. He stated that when real estate taxes that are paid but not posted and someone wants to sell their land then this puts a cloud on the title. He stated that they will not close and people are not able to get the loan. He asked can they imagine if a big real *Audio available  Minutes from the Petersburg City Council Special Called meeting held on: July 11, 2017 -4– ______________________________________________________________________________ estate owner had this situation happen to them and it could cause hundreds and thousands of dollars. He stated that they have to get this fixed and that they have to do this quickly. He stated that this is a no brainer. He stated that he is wondering why this is taking two years. He stated that he finally realized that this is one of the four positions that they appointed. He stated that the previous City Manager drove the City into disaster for three years. He stated that the City Attorney has been allegedly charged with lying to the City about some threat regarding a council meeting. He stated that there is no City Assessor in the assessor’s office at this current time. He stated that the land book has not been certified and that it is after July 1st. He stated that real estate taxes are the City’s largest source of income. He stated that he was happy tonight to hear that they have taken some emergency action to straighten this out. He stated that he is thinking that they have not appointed an assessor because they have not gotten any of the other’s one right. He stated except for maybe Joe and the clerk. He stated that they are three down. Michael Edwards, 409 Grove Avenue, stated that Mr. Cuthbert put a very well written article in the paper. He stated that he will read a quick snippet of it. He read, “Even so it is only a question of time before we again have a treasurer who allows delinquent taxes to rise to unacceptable levels, thereby sending the City into financial tail spin once again. It is reasonable to expect that the $110,000 cost of eliminating this risk will be more than offset of millions of dollars in effective collecting from the $10.8 million in delinquent taxes.” He stated that yesterday they entered into a new era in the City. He stated that they have brought on three key positions. He stated that they cannot continue to go and worry on if they are going to pay the bills. He stated that the City should not sink and that they City should stay afloat. He stated that they have to keep and remain aggressive on what is owed to the City. He stated that what is owed out of the $10.8 million is what really troubles him. He stated that he and Mr. Cuthbert have talked about this. He stated that it is regarding how much of the $10.8 million can the City still collect. He asked how much of the $10.8 million of people are still living and can they seize in a tax sale. He stated they need to learn from their mistakes. He stated that the vote today would be the City learning from their mistakes. He stated that he asks they pass this position. Johnathan Tolbert, 418 Beauregard Avenue, stated that he pastors a church in the City. He stated that for the last three or four years he has been wrestling with the City in regards to tax bills. He stated that Mr. Myers helped him out. He stated that in this last year the City went into the churches bank account and removed the money. He stated that he came to the City and he met with the treasurer and then the treasurer sent him to the assessor and then he met with the City Manager. He stated that after meeting with them they were told that they should not have been charged taxes and that their money would be put back in the account and fees would be paid. He stated that the following year they went through the same thing again. He stated that last year he sat with the then Mayor Myers to fix the problem. He stated that the problem was handled. He stated that it just recently happened to him again. He stated that they need a person that the citizens can go to who can be held accountable for their actions. He stated that this has been a strain on his church that they have to go through this every year. He stated that he hopes that this position handles everything and that he does not get another tax bill since they are 501c-3. Seeing no further hands, Ms. Harris closed the public hearing. There was discussion among City Council Members and staff. The motion was approved on roll call. On roll call vote, voting yes: Cuthbert, Myers, Hill and Parham; Voting No: Smith-Lee and Hart; Absent: Wilson-Smith 17-ORD-30 AN ORDINANCE TO AMEND AND RE-ORDAIN THE 2000 CODE OF THE CITY OF PETERSBURG BY ADDING DIVISION 7 TO ARTICLE III OF CHAPTER 2 OF THAT CODE, SUCH DIVISION ENTITLED “COLLECTOR OF CITY TAXES”, SUCH DIVISION PRESCRIBING THE AUTHORITY, DUTIES, AND FUNCTIONS OF THAT OFFICE; AND AMENDING THOSE SECTIONS OF THAT CODE THAT PLACE BILLING AND COLLECTION *Audio available  Minutes from the Petersburg City Council Special Called meeting held on: July 11, 2017 -5– ______________________________________________________________________________ FUNCTIONS WITH THE TREASURER BY PLACING SUCH DUTIES WITH THE COLLECTOR OF CITY TAXES. b. Consideration of a resolution to proceed with the detailed proposal stage under PPEA for the acquisition and operation of the City of Petersburg Water and Wastewater Utility Assets. BACKGROUND: Following the receipt of the initial unsolicited proposal, the City requested approval from City Council to form a negotiation team of City staff and consultants (financial, engineering, legal) and moved forward with consideration of the proposed project in accordance with PPEA requirements. In minutes for the regular council meeting on December 13, 2016 council voted and approved for the City Manager to review and accept for public competition competing proposals for purchase of its water and sewer systems from a private entity under the Virginia "Public-Private Education Facilities and Infrastructure Act of 2002 (PPEA). The City's PPEA Guidelines call for a two-step proposal process, with the first step being receipt of "conceptual proposals.” The City received two such proposals on February 7, 2017. The second step is the receipt of “detailed proposals.” Once City Council approves the attached resolution Both proposals from Aqua Virginia, Inc. (the original proposer) and Virginia-American Water Company indicate substantial experience in the ownership and operation of municipal water and sewer systems. The City considered many criteria during the evaluation of these proposals and the following was among the most important to the City: the price paid by a private entity, benefit to the public including ensuring a clear understanding and rationale for customer water and sewer rates, and the proposer's ability to meet the City's financial goals including investments by the proposer for much needed water and sewer system capital improvements. The approval of the attached resolution will allow City staff the continuation of the PPEA process. Adoption of the proposed Resolution does not commit the City to entering into an agreement regarding the water and sewer systems, but authorizes moving forward to a "detailed proposal" phase with these two companies, and makes findings required by the City's PPEA Guidelines in order to proceed with a competitive negotiation process with these two companies. The negotiation process may lead to an agreement with one of these companies, which would have to come before City Council for review and approval before it would be effective. RECOMMENDATION: Recommend City Council approve the attached resolution which does not bind the City into an agreement but allow the City to take the necessary steps to obtain more detailed proposals. Mayor Parham stated that this is just a presentation and that they will not voting on the resolution. Mr. Tyrrell stated that he is thrilled to see everyone tonight. He stated that they will be showing a PowerPoint presentation on the PPEA process. He stated that this is the 6th presentation to City Council over the last several months. He stated that they had a community meeting as well. He stated that the utility system is still in a crisis. He stated that the system is still failing a little bit every day. He stated that some days more than others. He stated that they really do not know what is going to happen next. He stated that the next thing that may fail is the main line into the City. He stated that if this happens they have no water coming into the City until it is restored. He stated that they are asking again they authorize the administration to proceed with the detailed proposal phase and allow them to negotiate the best terms that they can get with AQUA and American Water and bring back the recommendations back for council’s review and public comment. He stated that they still *Audio available  Minutes from the Petersburg City Council Special Called meeting held on: July 11, 2017 -6– ______________________________________________________________________________ have to be mindful that they are in a place where they do not have access to the credit markets. He stated that they do not have the critical tool that City’s normally have to respond to do bond issuance or maintenance repair with bond issuance. He stated that they are not that City right now and that they need to be. He stated that he spoke on this when they did the briefing of the CAFR. He stated that there are things that they can do to do a liquidity event. He stated that when they arrived the City was drowning in financial submissions. He stated that they believe and hope that they would agree that they are not drowning now and that they are treading water. He stated that they are not moving any closer to the shore. He stated that until the City gets a positive fund balance and access to the credit markets and an ongoing operational balanced budget they are always going to be in tremendous risk of slipping back down the hill. He stated that these are all things to keep in mind while they deliberate. Mayor Parham stated that they will not take any action tonight. He stated that he thinks everyone for coming out. He stated for everyone to please keep Councilwoman Treska Wilson-Smith in prayer with her family. He stated that she had an illness and she could not make it tonight. He stated also the clerk had a death in her family and for everyone to keep her in prayer as well. 4. ADJOURNMENT: City Council adjourned at 8:05 p.m. _________________________ Clerk of City Council APPROVED: _________________________ Mayor *Audio available