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HomeMy WebLinkAbout02-02-21Minutes of the Pulaski Town Council Meeting held at 5:30 p.m. Tuesday, February 2, 2021 in the Council Chambers of the Municipal Building at 42 First Street, N.W. The meeting also featured a general live cast to the public via the Town's Facebook page. In attendance were: Mayor: Shannon Collins, presiding Councilmen Present: G. Tyler Clontz; Brooks R. Dawson; Greg East; Lane R. Penn; James A. Radcliffe; Michael P. Reis Administration: Darlene L. Burcham, Town Manager Legal Counsel Spencer A. Rygas, Town Attorney Staff: Rebecca Leeper, Finance Director David Quesenberry, Clerk of Council Jordan Whitt, Social Media Manager Others Present: Emily Viers 1. Call to Order Mayor Collins called the meeting to order at 5:30 p.m. 2. Roll Call of Council The roll was then called. Present for roll call were Mayor Collins; Mr, Clontz; Mr, Dawson; Mr. East; and Mr. Penn. Absent for Roll Call was Mr. Radcliffe and Mr. Reis. With a majority of Council members present a quorum existed for the conduct of business. 3. Modifications to the Closed Session Aaenda Mayor Collins noted there were no modifications to the Closed Session agenda. 4. Closed Session Mayor Collins then requested a motion to go into Closed Session for the following matters: two items under Va. Code 2.2-3711 (a) 7, consultation with legal counsel pertaining to real or probable litigation regarding a zoning matter and an issue concerning Town property; and, one item under Va. Code 2.2- 3711 (a) (8) consultation with legal counsel regarding a zoning matter. Mr. Penn moved to enter Closed Session as requested. His motion was seconded by Mr. Dawson and approved on the following roll call vote: Lane R. Penn -Aye James A. Radcliffe -Absent Brooks R. Dawson -Aye G. Tyler Clontz -Aye Gregory C. East -Aye Michael P. Reis -Absent Closed Session began at 5:32 p.m. Mr. Reis arrived at 5:34 p.m. and Mr. Radcliffe at 5:37 p.m. and entered the Closed Session. 5. Certification of Closed Session Council returned from the Closed Session at 6:49 p.m. Mayor Collins then requested a motion that Council only discussed those three items for which it went into Closed Session: two items under Va. Code 2.2-3711 (a) 7, consultation with legal counsel pertaining to real or probable litigation regarding Page 1 of 7/February 2, 2021 a zoning matter and an issue concerning Town property; and, one item under Va. Code 2.2-3711 (a) (8) consultation with legal counsel regarding a zoning matter. Mr. Penn moved to approve the requested closed session certification motion, which was seconded by Mr. East and approved on the following roll call vote: Lane R. Penn -Aye James A. Radcliffe -Aye Brooks R. Dawson -Aye G. Tyler Clontz -Aye Gregory C. East -Aye Michael P. Reis -Aye 6. Pledge of AHeciiance At 7:00 p.m., Mr. Dawson led the Pledge of Allegiance. 7. Invocation Following the Pledge, Mr. East gave the Invocation. 8. Modification of the Public Session Agenda No modifications to the Public Session Agenda were required. 9. Guests and Visitors Mayor Collins welcomed guests who were present and those who were online. 10. Appointment to the Housing Authority, Resolution 2021-01 Council next considered Resolution 2021-01, regarding an appointment to the Housing Authority. Mr. Reis moved to adopt Resolution 2021-01, appointing Mr. Penn to the Pulaski Redevelopment and Housing Authority as written. The motion was seconded by Mr. Dawson and approved on the following roll call vote: Lane R. Penn -Abstain James A. Radcliffe -Aye Brooks R. Dawson -Aye G. Tyler Clontz -Aye Gregory C. East -Aye Michael P. Reis -Aye Council next heard a presentation concerning the FY 2019-2020 audit. 11. FY 2019-2020 Audit Presentation Mrs. Emily Viers of Robinson, Farmer, Cox Associates, CPA, L.L.C. presented the findings of the FY 2019-2020 audit to Council. Audit presentation summaries were given to the Council for reference during the presentation. Mrs. Viers reported that the Town had a clean unmodified opinion meaning that the financial statements presented by the Town were materially correct. The Town also received a clean unmodified opinion concerning the "yellow book" report at the end of the presentation summary. The previous year there had been a finding related to a material audit adjustment that was proposed as part of procedures. She reported that finding was not present in this year's review. There was a management comment related to audit adjustments because of the proposed procedural adjustments. However it did not rise to the level requiring reporting as a finding unlike the previous year. She noted that a schedule of the last five fiscal years was created to allow comparisons between revenues, expenditure and other financial data to see where balances were increasing or decreasing over time. Page 2 of 7/February 2, 2021 Mrs. Viers reported that the undesignated fund balance declined $325,000 which was lower than last year's decrease. Her explanation for the decline involved revenues from Other Financing Sources/Uses, which from 2016-2018 the Town received large amounts from Water Fund Transfers, the sale of a cell tower and a debt issuance. Recommendations were made at that time against making large transfers from the Water Fund since it was inflating the General Fund's fund balance to the detriment of the Water Fund, since it could not afford to make those transfers. As a result in 2019, there were no offsetting revenues that replaced that revenue source. In 2020 there was a capital lease issuance of $420,000 which offset previous transfers received from the Water Fund. Mrs. Viers noted the heavy reliance of the Town on Other Financing Sources and recommended against relying on that revenue source since ideally they were "one time" transactions that would not repeat every year. She recommended that in considering future budgets not to have heavy budget reliance on Other Financing Sources. Ideally revenues would equal expenditures and debt service. If there were plans for capital projects during the year, they were generally funded through built up reserves, debt issuance or specific grants. If grants were used, those had to be taken into account in revenue numbers. A second issue Mrs. Viers discussed was difficult to see because the Town's Intergovernmental Revenue combined both Federal and State revenues. The Federal revenue involved EPA funding for the brownfields projects and other CDBG funds for capital projects. If the Federal funds were removed and the capital lease issue was included, the revenues amounted to $1.4 million while the expenses totaled $1.6 million, resulting in expenditures exceeding revenue by $200,000. Concerning the comparison of unassigned fund balance to expenditures, Mrs. Viers said that the GFOA recommended that there be two months of reserves, approximately 17%. For 2020 the Town's percentage was 6% which had dropped off in the last couple of years due to the loss of proceeds from cell tower sales and transfers from the Water Fund. She said that she would like to get those percentages back up to the 2016-2018 balances. Mr. Reis asked if it would be fair to say that the problem started in 2016, but enough funds were received that it did not show up as a problem. If the one-time items were taken out and put in a different line, it would show that we had that problem for five years at least. Mrs. Viers said that's what it looked like to her. She did not know how reliance came to be on Other Funding Sources/Uses or if it was intentional at one time since it was known that the revenue would be coming, but just kept flowing through the budget every year. This was illustrated by the five year schedule in the handout. Mrs. Viers said the important thing was actions to address this downward trend. After discussions with the Town Manager and the Finance Director, steps had been taken which included: expenditures would no longer exceed budgeted amounts; project funds were being moved out into their own fund to see revenues and expenditures more clearly; and some direct costs were moved to the Water Fund which allocated an employee's time to the proper fund instead of having the Water Fund reimburse the General Fund which was fronting the costs. Mrs. Viers said she did a high level review of the FY 2021 budget and noted that budget amounts, revenue and other financing sources were budgeted more conservatively She felt like management was taking the proper steps to address the trend which hopefully would come back up. The Water Fund was becoming more self-sustaining but was not at the level where it could fund a cost allocation plan reimbursement to the General Fund of overhead costs. It might be considered in the next couple of years, but she did not know if it would be at the level it was previously. Mrs. Viers then conducted a brief review of revenue sources venturing that Intergovernmental Revenues would go up significantly due to programs such as the CARES reimbursement, other Page 3 of 7/February 2, 2021 program reimbursements through the County, and grants for proposed CDBG utility projects. She felt the Town would have an audit of Federal programs next year since federal aid would exceed $750,000. The audit would look at a single program to see if the Town was in compliance. Mrs. Viers did a brief review of expenditures noting an increase in community development expenditures. Regarding Long Term Obligations, the Water and Sewer Funds were included to make the debt per capital amount more comparable with the state's averages from the APA Comparable Cost Report. She also reviewed Other Post -Employment Benefits (OPEB) noting for Council the liability for each type of OPEB along with estimates for a 1% decrease or increase in the discount rate used in estimating these amounts. The information came directly from VRS and an actuarial evaluation provided by them. After a brief review of the letter of Communication and the Management Recommendations, on which Mrs. Viers noted that action had already been discussed and steps taken, she encouraged Council if they had questions to contact her at any time. Her presentation then concluded. 12. Citizen Concerns Regarding Fishing at Gatewood No action was taken concerning this item. Council next considered Hardie Project documentation. 13. Approval of Documents for DHCD/ARC for the James Hardie Project Mrs. Burcham reminded Council that the Town had received grant funding for the James Hardie Project from the ARC, CDBG and the EDA. Each grant had separate requirements and an administrative agreement was to be ready by February 12th, but an additional environmental review had pushed the date back to May. James Hardie would also contribute financially to the multi-year project. Separate accounts would be set up for each grant to show revenues and expenditures to ensure that the funds went for their intended use. Most of the documents were standard documents that Council may have encountered before, such as anti -discrimination provisions. Mr. Penn asked how the funds were to be used. Mrs. Burcham responded they would be applied to the James Hardie Project to create an injection facility to ensure their wastewater would be treated closer to the area where it's transferred to Peppers Ferry. Mr. Pedigo would come to the next meeting and brief Council on the Phase 2 Sulfate Study. An extension of the permit process for James Hardie had been granted that would allow improvements to be studied. Noting the anti -displacement document, Mr. Reis asked if that was a standard document or was residential displacement expected. Mrs. Burcham responded it was a standard document and no housing related issues were involved. Mr. East, referencing the auditor's review, asked if the issues with past grants had been addressed. Mrs. Burcham responded that older grants were separated out earlier and new grants would have separate funds. Applied to Hardie, it would be clear that the money could only be used for that project and that revenues and expenditures would have to balance. In the past some grants were appropriated into the General Fund and not spent for a particular grant because the money wasn't tracked on the expenditure side to that revenue. A deficit situation resulted because money was spent to those levels that were anticipated on the expenditure side, but the revenues were not available for the expenditures. That issue had been corrected. Mr. East ventured that resulted in the reduction of the unassigned fund balance. Mrs. Burcham said requirements for fund balance use for grants had been ended. She reminded Council that the budget revision in August reduced both expenditures and revenues in light of COVID and certain trends to be sure funds were not expended. If use of the fund balance was needed, that had to be brought to Council first. Page 4 of 7/February 2, 2021 Mr. Reis asked if each individual grant for the project was being tracked. Mrs. Burcham replied that certain monies could be used for certain things. Mr. Sharp from the NRVRC had been engaged by the Town to track each grant given his familiarity with the different requirements. The Town was tracking those requirements and had submitted a budget for planned expenditures. Mr. Reis asked if staff was getting more grant experience and felt it would be good to have more in- house experience as future grants were received. Mrs. Burcham felt the most critical piece presently was the financial aspect especially in incurring and requesting reimbursement. The Finance Department was set up to address this. She noted that staffing was "thin" for tracking grants and she was getting Mr. Deal to assist with some of them. She suggested, concerning future grants, that there be a dedicated position on staff that would be solely responsible for grants, because of the difficulties with grants and the amount of time their administration required. Mr. Reis asked if the grants allowed the Town to "capture" a percentage of in-house costs. Mrs. Burcham responded some grants allowed a 10% administrative cost that could be reimbursed while others did not. Mr. Reis moved to approve the documents necessary for the DHCD-ARC grants for the James Hardie Project as listed in the agenda under Item 13. The motion was seconded by Mr. Penn and approved by the following roll call vote: Lane R. Penn -Aye James A. Radcliffe -Aye Brooks R. Dawson -Aye G. Tyler Clontz -Aye Gregory C. East -Aye Michael P. Reis -Aye 14 Public Comment Period No comments were received by the Council. 15. Consent Aaenda-Minutes of January 19, 2021 Mayor Collins then asked for consideration of the minutes of January 19, 2021. Mr. Dawson moved to approve the January 19, 2021 meeting minutes. Mr. East seconded the motion which was approved on the following roll call vote: Lane R. Penn -Aye James A. Radcliffe -Aye Brooks R. Dawson -Aye G. Tyler Clontz -Aye Gregory C. East -Aye Michael P. Reis -Aye 16. Council Comments Mayor Collins opened the floor for comments, starting with Mr. Penn. Mr. Penn asked if there were CARES funds left over from the installation of the drive-through window. Mrs. Burcham responded that the Town was still doing some CARES projects. Mr. Penn asked if an overhang could be placed over the drive-through window. Mrs. Burcham replied that was something that was being looked at and planned for, with the question being where it would be installed and what it would be connected to. Engineering was reviewing the issue which had become more important with increased drive-through use and the upcoming removal of the drop box. Mr..Dawson complemented Mrs. Burcham for her work in making an accurate determination of where the Town was at financially. Referring to the suggested 15% recommended undesignated fund balance, he noted there was a $1 million difference in where the Town was and where it needed to be. Addressing that question was not a one year matter. The budget and financial plan could not get the Town where it wanted to be with what he described as that "big of a hole". He felt it might not be possible in five years without knowing how much Council would have to change possible budget funds Page 5 of 7/February 2, 2021 to be "put back". Council he felt would have to commit to a certain amount to be saved with all else having to work around it. The question he continued was finding a reasonable way to do that, which should start being considered now. The problem was there before and there were items and sales that covered up a divide between the true revenues and expenditures. A broader spectrum would be required as to where the Town wanted to go and what needed to be changed to get there. Mr. East had no comment. Mr. Radcliffe thanked Mrs. Burcham for all of her work and for guiding Council. He also complemented Public Works for a good job during the recent snowfall and noted he had heard nothing but complements. He noted that Mrs. Hale had approached him as to why the Town did not have a "LOVE" sign and suggested there might be ways to get groups to help and asked for information at the upcoming work session. Mrs. Burcham informed Council that there were plans for a "LOVE" sign which had been designed. Mr. Whitt had been trying to find the person who had volunteered, if materials were provided, to do the work. The Town had purchased the materials for the sign when, if built, would qualify the Town to receive a small grant from the state. Mrs. Burcham said she would bring information for Council to the next meeting. She felt the project "lost momentum" when the pandemic occurred. The primary need was for someone to fabricate the sign. She added that she would get the design for Council's review to see if they were comfortable with it. Mr. Radcliffe added that Mrs. Hale had offered to help with the project. Mrs. Burcham said the focus was on getting someone to fabricate the sign. Mr. East complemented the Public Works employee who cleared the sidewalks remarking that they did a good job and that they were out at 6:00 am on a very cold Sunday morning. Mayor Collins remembered that the "LOVE" sign was to go at the Train Station and that the Pulaski Theater had created a smaller version. Mr. Clontz had no comment. Mr. Reis expressed his appreciation to Public Works for their work during the storm emphasizing the long hours they had put in. He then asked Mrs. Burcham were there any ideas what the reassessment had done. Mrs. Burcham responded that the Town had not received the book from the County that would answer that question, but that it would be critical to the budget's development. Council next received the Manager's Report. 17. Manager's Report Mrs. Burcham reported that the Senior Center had relocated to the Train Station and would probably remain there until the end of February. Cable had been installed earlier in the day, so they could have television along with their other programs. She complemented Ms. Hopkins on keeping the seniors informed and said and earlier she had assisted a 94 year old woman to get her COVID vaccine. Mr. Radcliffe encouraged Council to meet Ms. Hopkins, describing here as a "godsend" to the seniors. Mrs. Burcham noted that the Building Official's position was filled by Tom Hager and the new Human Resource Manager, Jacqueline Reid, began her duties the previous day. The Redevelopment and Housing Authority met last week and re-elected Mr. Penn, Chairman. The Housing Authority was made aware that the Town on behalf of Calfee School had applied to the Appalachian Regional Commission for $500,000 in funding. The grant required no match and the Calfee representatives were informed that the Town would not be putting up local funding for these Page 6 of 7/February 2, 2021 various grants that were being requested. The Town was acting as an agent and it would be some months before anything would be heard from the ARC grant. There would be a public hearing in March on the CDBG application for the Calfee School. Mrs. Burcham then reviewed the Town Code provisions for rental inspections and vacant building registration, deeming both programs important in providing residents with safe housing. She felt there was a time, when Council was comfortable, to reinstitute those programs. There would be time needed for educating the public and for implementing the programs. A staff position would be allocated to assist the effort. After these two programs were implemented, Mrs. Burcham said she would return to Council and seek to apply for the state's ARS (Acquire, Renovate, Sell) Program. The program would allow the Town to receive federal and state funding to make homes available for acquisition. The homes would be renovated and sold with allotments for rehabilitation repaid to the state and any remainder accruing to the Town for other housing activities. She asked Council to consider the two programs or remove them from the Town Code. If a decision was made to move forward it would require some education for the public. Mr. East referred to previous discussion on the program and said the vacant building ordinance was implemented because of Main Street. He felt both were good programs. A drop in assessed values years back resulted in a "buy up" of homes in which there was no further investment. He thought there was with rental inspection, some method of gaining funds to support a position. Mrs. Burcham said there was an application fee when the structure was registered. There could be four year certificates issued upon a successful inspection. The inspection checklist she noted was similar to a HUD Section 8 checklist which focused on safety issues. A time for compliance was given with the first re -inspection performed at no cost. Fees were charge for additional re -inspections. She did not anticipate that the fees could support a position. Mrs. Burcham said her intentions for the programs was due to the conditions of some properties in the Town. Mr. East responded that the rental inspection program was a good program given the percentage of rental properties in Pulaski and felt it was critical to moving forward. Mrs. Burcham noted that Public works was out Saturday night and after a break was pushing snow at 3:00 a.m. Given the state of -their equipment, they did an incredible job and she was very pleased with their work. 18. Reminder of Future Council Meetings and Adjournment Mayor Collins reminded Council of its next meeting on Tuesday, February 16, 2021, with the Closed Session beginning at 5:00 p.m. and the Public Session at 6:30 p.m. Being no further business, Mr. Reis moved to adjourn. The motion was seconded by Mr. Penn and carried by unanimous voice vote at 8:00 p.m. Approved: W. Shannon Collins Mayor ATTEST: David N. Quesenberry Clerk of Council Page 7 of 7/February 2, 2021