Finance Committee

Finance Committee Monday, August 19, 2024, 8:00 A.M. Virtual meeting pursuant to Chapters 113 and 115 of the Codified Ordinances (as amended in Ordinance 22-28), and Resolution 22-29, enacted on March 22, 2022. Members present: Council Member, Nancy Moore, Chair Council Member, Anne Williams Council Member, Carmella Williams Council Member, Kim Bixenstine Citizen Member, Martin Kolb Citizen Member, Anthony Moore Citizen Member, Ketan Patel Citizen Member, Kandis Williams Others present: Mayor, David E. Weiss Chief Administrative Officer, Jeri E. Chaikin Director of Finance, John Potts Chief of Fire, Patrick Sweeney Director of Planning, Joyce Braverman Assistant Chief of Fire, James Heath Human Resources Analyst, Jennifer Coe Planner, Anna Mates Frank GoForth, League of Women Voters Sara Schiavoni, Citizen Member of Safety & Public Works Committee * * * * APPROVAL OF THE MINUTES OF THE REGULAR MEETING JULY 15, 2024. Chair Nancy Moore stated that the minutes of the July 15, 2024 meeting were unanimously approved. * * * * REQUEST TO AUTHORIZE A GRANT APPLICATION TO, AND TO ACCEPT A $6.99M INFRASTRUCTURE GRANT FROM, THE OHIO PUBLIC WORKS COMMISSION (OPWC) WITH APPLICATION TO THE DISTRICT ONE PUBLIC WORKS INTEGRATING COMMITTEE (DOPWIC) FOR STATE CAPITAL IMPROVEMENT PROGRAM (SCIP) FY 2026 FUNDING FOR THE LEE ROAD RESURFACING & RECONSTRUCTION PROJECT. Director of Planning, Joyce Braverman requested to authorize a grant application to, and to accept a $6.99M infrastructure grant from, the Ohio Public Works Commission (OPWC) with application to the District One Public Works Integrating Committee (DOPWIC) for State Capital Improvement Program (SCIP) FY 2026 funding for the Lee Road Resurfacing & Reconstruction project. Ms. Braverman stated that this is funding for the Lee Road reconstruction and resurfacing project. Projects are selected through a competitive statewide process, and applications are due September 12th. We will have preliminary rankings as of December 6th and final awards in July. This is part of implementing the Lee Road Action Plan, which council adopted in March of 2024 and is a targeted reinvestment plan for Lee Road. The project elements of this $25 million project includes border to border roadway resurfacing and reconfiguration signalization enhancements, crosswalk and intersection improvements. Improved lighting south of Van Aken will include an off-road bike path, streetscaping, and a crosswalk mid-block. We do anticipate working with the county and will begin construction in Spring of 2027. We hope to be done about a year later. Right now we have amassed almost $17 million in grant funds, and those are all listed out from various sources. In addition, we also have a $1 million contribution from the county toward engineering. This did go to the Safety and Public Works Committee on August 1st and they unanimously approved it. There was discussion about our coordination with Cleveland and with Cuyahoga County. We are still coordinating with Cleveland. They are engaging in pre-engineering in the next year. They are about a year behind us, and the county has proven to been to be an extraordinary partner especially on the configuration of Warrensville, Chagrin and Van Aken. Council Member Bixenstine asked if the bike lanes on Lee will connect with the bike lanes on Van Aken. Director Braverman stated that they would and that they have to work out during engineering work how they will connect, but the off-road bike lane for Lee, they are hoping to start at around City Hall and go south and then north of City Hall. We think there will be bike shoulders which are a little narrower than a bike lane, and that will be inroad. The Finance Committee approved the request to authorize a grant application to, and to accept a $6.99M infrastructure grant from, the Ohio Public Works Commission (OPWC) with application to the District One Public Works Integrating Committee (DOPWIC) for State Capital Improvement Program (SCIP) FY 2026 funding for the Lee Road Resurfacing & Reconstruction project. * * * * REQUEST TO AUTHORIZE A $150,000 GRANT APPLICATION TO, AND TO ACCEPT A GRANT FROM, THE CUYAHOGA COUNTY DEPARTMENT OF DEVELOPMENT 2025 MUNICIPAL COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM (CDBG) FOR HILDANA PARK IMPROVEMENTS. Page 2 of 11 Planner, Anna Mates requested to authorize a $150,000 grant application to, and to accept a grant from, the Cuyahoga County Department of Development 2025 Municipal Community Development Block Grant Program (CDBG) for Hildana Park Improvements. Ms. Mates stated that this grant application will be for Hildana Park improvements. Improvements were last made to Hildana Park in 2018 when chess and backgammon tables were installed and an interactive public art piece was also commissioned and installed. The proposed improvements will include new benches, additional trees, repaved paths, and new public artwork that will be developed with community input. The Cuyahoga County Department of Development has allocated $1.5 million for the 2025 CDBG Grant Program and will award 10 grants of up to $150,000 each. The Planning Department is proposing to submit a grant application for $150,000, which is the maximum amount available. We held a public meeting on July 24th for residents to learn about these grant opportunities and to share project ideas. Restoring the public art at Hildana Park was proposed at this meeting. However, the public art is currently in disrepair, has design flaws and urgently needs complete reconstruction or replacement based on this and other improvements that residents would like to see, including increased shade and updates to the deteriorated benches and paths. Project funding will come from grant funds and neighborhood project funds appropriated in the capital budget. Parks are a critical part of the neighborhood's infrastructure and residents enjoy the passive nature of Hildana Park. As mentioned, having free recreation amenities directly in the neighborhood is important. Moreland residents have expressed that they consider parks and art as critical for community building and building neighborhood pride. The improvements will create an improved public space that will continue to serve residents of the immediate neighborhood. On August 1st, the Safety and Public Works Committee recommended approval of this application. The grant application and supporting legislation is due to the Cuyahoga County Department of Development on September 16th and recipients will be notified of awards in the Spring of 2025. Council Member Bixenstine inquired about the design flaws in the current public art that is disrepair in the park and what recommendations the Planning Department has and how to prevent having design flaws in the replacement public art. Ms. Mates stated that the design flaws are both in the materials that were used and in the actual design of the artwork. The City would do a call for artists and would make sure that we are working with the artist and ensuring that the materials are of a higher quality. Council Member Carmella Williams asked if the new benches would include built in chargers and if they would be solar powered. She also inquired if additional trees would be taken into account when placing those benches. Ms. Mates stated that they plan to include benches that do not have charging stations and the benches they would be similar to benches that are used in other parks throughout the city. There would be a plan to place a few new benches where there is already shade, but to also plant trees in areas where there will be more shade as the trees grow. The Finance Committee approved the request to authorize a $150,000 grant application, to accept a grant from, the Cuyahoga County Department of Development 2025 Municipal Community Development Block Grant Program (CDBG) for Hildana Park Improvements. Page 3 of 11  * * * * REQUEST TO AUTHORIZE A $50,000 GRANT APPLICATION TO, AND TO ACCEPT A GRANT FROM, THE CUYAHOGA COUNTY DEPARTMENT OF DEVELOPMENT 2025 SUPPLEMENTAL GRANT PROGRAM (CDSG) FOR HILDANA PARK IMPROVEMENTS. Planner, Anna Mates requested to authorize a $50,000 grant application to, and to accept a grant from, the Cuyahoga County Department of Development 2025 Supplemental Grant Program (CDSG) for Hildana Park Improvements. Ms. Mates stated that the grant would be for Hildana Park improvements and in conjunction with the CDBG grant. This has been done previously when CDBG and CDSG Awards were used to fund the Chagrin Lynnfield Intersection Improvement Project, and most recently, the Lee Road Storefront and Exterior Improvement Program. The Cuyahoga County Department of Development has allocated $1.5 million for the 2025 CDSG Program and will award 30 grants of up to $50,000 each. The Planning Department is proposing to submit a grant application for $50,000, the maximum amount available. Based on the condition of the existing public art and other improvements that residents would like to see, the Planning Department recommends applying for the grant. The Safety and Public Works Committee recommended approval of this application. The Finance Committee approved the request to authorize a $50,000 grant application, to accept a grant from, the Cuyahoga County Department of Development 2025 Supplemental Grant Program (CDSG) for Hildana Park Improvements. * * * * ACCEPTING THE RECOMMENDATIONS OF THE CITY’S TAX INCENTIVE REVIEW COUNCIL (TIRC) TO CONTINUE THE EXISTING DEVELOPMENT AGREEMENTS FOR TAX EXEMPTION AND PAYMENTS IN LIEU OF TAXES (PILOTS), PURSUANT TO OHIO REVISED CODE SECTION 5709.85. Director of Economic Development, Laura Englehart requested to accept the recommendations of the City’s Tax Incentive Review Council (TIRC) to continue the existing development agreements for tax exemption and payments in lieu of taxes (PILOTs). Director Englehart stated that the Tax Incentive Review Council or TIRC meets annually to review all of our active agreements that grant property tax exemptions for private developments. We have City citizen members, residents of Shaker, that are on the TIRC, but it is a County body. There are a number of Cuyahoga County staff members and experts included on the TIRC. The City met with the TIRC on Page 4 of 11 July 11th, and at that meeting the TIRC did unanimously approve all of our agreements in Shaker to be in compliance, and they recommended that each of those agreements be continued. Director Englehart give a brief review of the TIRC discussion and explained the types of tax incentive agreements that the City has. The first is an Urban Renewal District, often called our 725 as that is the chapter of the Ohio Revised Code that authorizes these types of agreements. This is a geographical area that's focused around the Chagrin Lee intersection. For new development that happens within certain boundaries, the City signs an agreement with that property owner that includes a provision, a very partial tax exemption, in the entire district, no matter what the project is, 75% of the value of the improvements done to that property are converted into payments in lieu of taxes or PILOTs. So the owner pays their full property taxes, 75% of that is redirected, and the City keeps that in a fund to pay debt service on bonds that we issued many years ago to make public improvements within the district. Historically we have seen a deficit where the City has not collected sufficient PILOT payments to pay the full debt service. This past year, there was a deficit of about $3,700 that was subsidized by the City through the general fund to pay that debt service. Our Finance Department's projections expect that no subsidy will be required beginning in 2025. We do have a couple new projects coming online, but we are expecting 2025 that the full debt service will be able to be covered annually by the pilot payments in this Urban Renewal District. Moving to our TIFs or Tax Increment Financing, we have three active TIFs right now, all within the Van Aken District. One is on what we call the Phase 1 District which is the Van Aken District. Shaker Plaza is the shopping center right on the other side of the RTA tracks in the Van Aken district. And then we have a public improvements TIF on the Wendy's property that was reconstructed. Funds were distributed either to the developer, the Shaker schools, or retained for future public improvements based on each agreement. Moving on to the Commercial CRAs, we have two agreements in the Warrensville Farnsleigh CRA. One is with the Shaker Rocks climbing gym, and the other is with the Nest Schools. Each of those are also in compliance. Those businesses committed to creating jobs and payroll, and they both did that according to their agreements. The Nest Schools was originally constructed as Le Chaperon Rouge. When the business sold to a new operator and owner, we were able to look again at the finances. When we transferred the agreements and allowed the exemption on the taxes to continue, we realized that their financials did not warrant the full term. And so we were able to reduce the term of the exemption from 15 years to 10 years. Mayor Weiss commented that we put these agreements in place when we believe that the end result will be a benefit to the City, both in terms of improvements or jobs. As time goes by on these agreements, we monitor them and file them regularly. Director Potts and I frequently talk about the progress that we're making on each of these projects which ultimately will benefit the General Fund. These projects are in keeping with Shaker's approach of investing early and benefiting in the long run. We are very pleased to see that we continue to have compliance with all of the agreements we have. Page 5 of 11 Chair Moore asked about the results of the Board of Revisions case for the Wendy's reevaluation. Director Englehart stated that there were two Board of Revisions cases on the Wendy's property. One is resolved completely and we did receive an additional payment already. There is also an additional Board of Revisions case on the Wendy's property that is still able to be appealed. So there may be some ongoing changes on that property, but to date, the resolution of the first Board of Revisions case did result in additional property tax payments made. Citizen Member Patel commented that he did participate in his first TIRC meeting earlier this summer. He shared compliments on the team which is a combination of the Finance, Law and Economic Development departments and that the County staff was really appreciative of the efforts that Shaker takes in abiding with its responsibilities relating to the TIRC. The County said that Shaker's preparation materials is far ahead of what most cities do when they come before the TIRC. The Finance Committee approved the request to accept the recommendations of the City’s Tax Incentive Review Council to continue the existing development agreements for tax exemption and payments in lieu of taxes (PILOTs). * * * * REQUEST TO AMEND THE CURRENT CONTRACT WITH HOME REPAIR RESOURCE CENTER (HRRC) TO INCREASE THE CONTRACT AMOUNT BY $60,500, FOR A TOTAL NOT-TO-EXCEED CONTRACT AMOUNT OF $208,100. Director of Economic Development, Laura Englehart requested to amend the current contract with Home Repair Resource Center (HRRC) to increase the contract amount by $60,500, for a total not-to- exceed contract amount of $208,100. Director Englehart reminded the Committee that in January the City entered into a contract with the Home Repair Resource Center. The City has done this on an annual basis for some time and for the past three or four years, the Home Repair Resource Center has administered the city's home repair grant programs, along with providing a myriad of other services around home repair to residents. In the original contract, $111,000 was reserved as grant funds available to Shaker residents for home repair on their homes. There is a high need and demand this year, and we made some additional changes to our programs. And so we are finding now at this point in the year that the demand is exceeding the available grant funding that we have today. And the grant funding of $111,000 that we originally reserved is now fully committed as of the end of July. We have additional projects that we expect need funding, and that will also come in between now and the end of the year. We are requesting the Committee to approve an amendment to our existing contract with HRRC. That would increase the contract amount by $60,500 and of that new amount, $55,000 would be reserved as additional grant funds. The remainder is retained by HRRC as an administrative fee of 10% on each project that is completed. The additional $60,500 is currently available in the Economic Development department’s operating budget for 2024 so no new Page 6 of 11 appropriation is needed at this time. However, additional home repair grant funding will be discussed as part of our budget process for 2025. The City updated our home repair grant programs this calendar year for the first time in many years. We had conversations last year about the need to address increased home repair costs, increased home repair needs and so we did increase the maximum grant amounts and we did increase income eligibility that changed from 80% of area median income up to 100%. The City did expand eligibility and grant amounts, and that is the reason we are expanding additional dollars this year. The use of our home repair grant programs is often and historically cyclical. It will go up and down based on our Building and Housing departments exterior inspection cycles that occurs every five years, and it's done by neighborhood. This year we are seeing a significant number of applications and home repairs in the Moreland, Lomond and Sussex neighborhoods based on the inspection cycles that preceded this year. We do not know if this high need will continue as the inspection cycles change so we will be evaluating that and coming back to you to talk about that in the future. But today we know we need additional funds to service the residents and get the home repair projects completed that are already in the pipeline. We have had 47 home repair grant projects already either completed and fully paid or have received approval to proceed this year through July alone. That has amounted to more than $109,000. That is significantly exceeding any prior use of the program. We already have an additional 15 homeowners that are ready to proceed waiting for us to approve these additional funds. There are pending applications, many of which will not be ready to move until next year, but some of which may also proceed this year as well. Council Member Anne Williams asked how the Economic Development Department arrived at the $60,500 number for the increase. Director Englehart explained that it comes from the 15 homeowners that are ready to proceed and that they know exactly how much money those grants will be. That totals approximately $40,000. There will also be a few others in the pending applications that we currently have that will be able to proceed this year. The $60,500 is to ensure we are accommodating under the contract. HRRC gets a 10% per project fee for all of their administrative work. So that is included in that total requested amount. The Finance Committee approved the request to amend the current contract with Home Repair Resource Center (HRRC) to increase the contract amount by $60,500, for a total not-to-exceed contract amount of $208,100. * * * * REQUEST TO AUTHORIZE THE PURCHASE OF FIVE (5) LUCAS CPR DEVICES FROM STRYKER AS A SOLE SOURCE VENDOR FOR AN AMOUNT NOT TO EXCEED $125,000.00. Fire Chief Patrick Sweeney requested the authorization to purchase five (5) Lucas CPR Devices from Stryker as a Sole Source vendor for an amount not to exceed $125,000.00. Page 7 of 11 Chief Sweeney explained that the Stryker devices are automatic chest compression devices that are carried on our three rescue squads. These were introduced to the pre-hospital environment and fire departments by University Hospitals back in 2015. They donated several of these units to the city. They also donated a lot of them to other greater Cleveland fire departments. We have since added these to all of our squads. We have three of them and they are currently at end of life. We've had great success with these devices here, and we're to the point where we want to replace them. In addition to replacing these three, we would like to add two more to our inventory and put them on each fire engine. So there would be one on every rescue squad, three of those, and on every fire truck. So five of them total. The reasons we want to put them on the fire trucks is more often than not when our rescue squads with the medics are out on calls, a fire truck will be a first responder and so we've equipped these fire trucks to be advanced life support fire trucks with all of the medications and all of the equipment to take care of patients out in the field. Council had appropriated $125,000 in the 2024 capital budget and we now have pricing on these units. Stryker makes a lot of equipment for the medical industry and these are some of the devices that they make for us. They are the sole source vendor for these devices. This was presented to the Safety and Public Works Committee back on August 1st and Citizen Member Salmon inquired as to how often we use these devices. We know that we're using them on average once a week. The Finance Committee approved the request to authorize the purchase of five (5) Lucas CPR Devices from Stryker as a Sole Source vendor for an amount not to exceed $125,000.00. * * * * REQUEST TO WAIVE COMPETITIVE BIDDING FOR THE PURCHASE OF TWO (2) ELECTRIC VEHICLES FOR THE FIRST CALL PROGRAM AT A COST NOT TO EXCEED $36,000 PER VEHICLE. Assistant Chief James Heath requested to waive competitive bidding for the purchase of two (2) electric vehicles for the First CALL Program at a cost not to exceed $36,000 per vehicle. Assistant Chief Heath stated that this request is similar to the two vehicles that Police purchased earlier this year for the First CALL Program. The Fire Department has been tasked with purchasing the second set of two vehicles, which will complete the purchases for the vehicle needs of the program. In May, the city took delivery of two Chevy Bolt electric vehicles, which the police had previously taken to the Finance Committee and Council for approval. Unfortunately, those vehicles are no longer available. At that time, the vehicles were not on state bid and there were no proposals submitted through the formal bidding process. When asked for the reason nobody bid, one dealer said that the demand is so high, that they can find buyers without having to go through a bidding process, put up a bid bond and hold the vehicles pending award of the bid and issuance of a purchase order. Page 8 of 11 We have been unable to locate any electric vehicles available on the state bid contract. After reviewing the currently available electric vehicles, we have identified the Hyundai Kona Electric as a suitable option for the final two vehicles. It is a four-door sedan that has 200 miles of estimated mileage per charge, and it retails an estimated price of $34,070. We would like to bypass the formal bid process and move to purchase the vehicles. This matter was brought before the Safety and Public Works Committee on August 1st. During this meeting, Council member Moore supported this request and agreed that the city needs to be more nimble in the procurement process, in an effort to not be locked out of necessary and time sensitive purchases. Mayor Weiss also explained that the city is focusing efforts on specifically purchasing electric vehicles for the First CALL program. The City has made great efforts around sustainability by purchasing vehicles and equipment that are environmentally conscious. Mayor Weiss also added that additional vehicle chargers will be installed at the Police Department to support the electric vehicles for the First CALL program. The Safety and Public Works Committee unanimously supported the request for this purchase and to waive competitive bidding. The Finance Committee approved the request to waive competitive bidding for the purchase of two (2) electric vehicles for the First CALL Program at a cost not to exceed $36,000 per vehicle. * * * * REQUEST TO ACCEPT A FEMA ASSISTANCE TO FIREFIGHTERS GRANT FOR $226,345 WITH A 10% CITY MATCH OF $20,577 FOR TRAINING AND PROFESSIONAL DEVELOPMENT. Fire Chief Patrick Sweeney requested to accept a FEMA Assistance to Firefighters grant for $226,345 with a 10% city match of $20,577 for training and professional development. Chief Sweeney stated that back in March the Fire Department applied for a FEMA Assistance to Firefighters Grant specifically to seek funding to support the professional development needs in the Fire Department. This grant is funded every year by Congress. The Fire Department has been fortunate over the years to receive awards to help support a wide variety of needs in the department. This past July we received notification from FEMA that they were awarded our full grant amount. The department has had pretty significant turnover over the last five to seven years and we have added, through retirements, some additions to the department. Thus, there is a big need to provide some ongoing certifications and training to new officers and new firefighters. The grant requires a 10% city match which we believe we can cover through our existing training budget. If we are unable to do that, quite often the Emergency Management Agency in Cuyahoga County supports Fire Departments match portions of these grants. We have a call in to them to see if they can do that for us. This was presented to the Safety and Public Works on August 1st and they unanimous unanimously approved the acceptance and appropriation of these dollars. Page 9 of 11 The Finance Committee approved the request to accept a FEMA Assistance to Firefighters grant for $226,345 with a 10% city match of $20,577 for training and professional development. * * * * REQUEST TO ENTER INTO A RENEWAL OF THE CONTRACT FOR NEOGOV AT A COST OF $25,116.73 FOR THE PERIOD OF SEPTEMBER 1, 2024 TO AUGUST 31, 2025 FOR A PROFESSIONAL DEVELOPMENT LEARNING MANAGEMENT SYSTEM. Human Resources Analyst, Jennifer Coe requested to enter into a renewal of the contract for NEOGOV at a cost of $25,116.73 for the period of September 1, 2024 to August 31, 2025 for a professional development learning management system. Human Resources Analyst, Jennifer Coe stated that NEOGOV is the City’s online learning management system. It does some technical skills training such as computer programs that are used most often like Excel and Word. There are three different levels for each of those. There are also soft skills training such as customer service. The program has been used for one of our DEI trainings as well. This request is for a renewal of the contract. We first entered into a contract with them in September of 2021. We have been able to renew it since then because it has been under the $25,000 threshold which requires Council approval. This is the first time that the renewal is actually over that amount at $25,116. The Finance Committee approved the request to enter into a renewal of the contract for NEOGOV at a cost of $25,116.73 for the period of September 1, 2024 to August 31, 2025 for a professional development learning management system. * * * * AUTHORIZING THE EXECUTION OF CERTIFICATES BY THE DIRECTOR OF FINANCE AND THE PAYMENT OF AMOUNTS DUE UPON CERTAIN CONTRACTS FOR WHICH THE FINANCE DIRECTOR HAS ISSUED THEN AND NOW CERTIFICATES IN CONNECTION WITH CERTAIN EXPENDITURES. Director of Finance John Potts requested the authorization of the execution of certificates by the Director of Finance and the payment of amounts due upon certain contracts for which the Finance Director has issued Then and Now Certificates in connection with certain expenditures. The Finance Committee approved the authorization of the execution of certificates by the Director of Finance and the payment of amounts due upon certain contracts for which the Finance Director has issued Then and Now Certificates in connection with certain expenditures. * * * * Page 10 of 11 DISCUSSION ITEM: GENERAL FUND Q2 2024 YTD FINANCIAL UPDATE. Director of Finance John Potts presented the General Fund Q2 2024 Year-To-Date Financial Update. Director Potts explained that the City does not budget on a monthly basis but rather for the full year. Since we budget annually, when the numbers come in for June we are able to do an analysis of where we're at halfway through the full year budget. We are looking to see if our revenues are trending above 50% of budget, and our expenses are trending below 50% of budget. Operating revenue for the first six months of 2024 was $34.2 million, which was a 1.3% increase over last year. Our income tax receipts are above budget at 54.5%. Our ambulance runs are also up as we are almost at 70% of the full year budgeted revenue in that line. Some other comments on revenue, our RITA or Regional Income Tax Agency refund, which we get in the summer each year, was substantially higher than what we budgeted. We budgeted effectively what RITA tells us to budget. As interest rates are still very high, RITA has taken in a good amount of investment income, which works to offset their operational expenses for all of their members, so that has yielded a retainage refund to the City above our budgeted amount. On the expenditure side, from a compensation perspective, we're trending at around 47% of the 2024 budget, which is a positive. And our total operating expenditures, which is compensation plus our other expenditures are trending even lower at 44.5%. Council Member Anne Williams asked for an update on the General Fund Reserve. Director Potts explained that typically that percentage is calculated at a point in time and will be done as part of projecting out the rest of 2024 during budget season. Mr. Potts stated that the City would likely be a little above where we ended in 2023. * * * * There being no further business, the meeting was adjourned at 9:00 a.m. The next meeting will be September 16, 2024. * * * * Respectfully submitted, ________________________________ John J. Potts, CPA Director of Finance, Finance Committee Page 11 of 11