HomeMy WebLinkAboutMinutes - Minutes - City Council - Meeting Date: 12/17/2002 * PLEASE NOTE: Since the Glendale City Council does not take formal action at
the Workshops, Workshop minutes are not approved by the City Council.
MINUTES
CITY OF GLENDALE
CITY COUNCIL WORKSHOP
December 17, 2002
1:30 p.m.
PRESENT: Mayor Elaine M. Scruggs, Vice Mayor Thomas R. Eggleston, and
Councilmembers Joyce V. Clark, Steven E. Frate, David M. Goulet,
H. Phillip Lieberman, and Manuel D. Martinez
ALSO PRESENT: Ed Beasley, City Manager; Terry Zerkle, Assistant City Manager;
Rick Flaaen, City Attorney; and Pamela Oliveira, City Clerk
1. TOTAL COMPENSATION PROGRAM REVIEW — 1 HOUR
CITY STAFF PRESENTING THIS ITEM: LaVerne Parker-Diggs, Human
Resources Director; Alma Carmicle, Human Resources Assistant Director and Ken
Wallace, Human Resources Manager.
Today's presentation will review results of the development of a total compensation
strategy for the City of Glendale. At the April 23, 2002 City Council Budget Workshop,
Mayor and Council directed Human Resources staff to conduct a comprehensive review
of the city's compensation and benefits programs to ensure that available resources
were being effectively utilized.
Human Resources staff and the Employee Total Compensation Task Force, comprised
of city employees, were involved in the review and development of the total
compensation strategy.
Previously compensation and benefits decisions at the City of Glendale were made
separately and independent of each other. Mayor and Council requested a human
resources strategy that would tie all human resources programs into one "big picture".
The development of the total compensation strategy included a review of the following
components:
1. Compensation — the central part of the city's new strategy includes pay
elements such as base pay, specialty pay, leave and holiday pay.
Compensation is responsible for creating a standard of living for city
employees.
2. Benefits — the second part of the city's new strategy to supplement the cash
compensation employees receive. Benefits include programs such as medical
and dental coverage, life and disability insurance. Benefits protect the
standard of living created through compensation.
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3. Work Intangibles — the third part of the city's .new strategy to highlight and
increase the value of other human resources programs that are important to
employees, but are less tangible than compensation and benefits. Work
intangibles may include recognition programs, work/life balance programs, and
development opportunities. Work intangibles allow the city to make the most
of opportunities to recruit and retain the brightest and best employees.
In addition to the April 23, 2002 Council Budget Workshop, at the April 2, 2002, Council
Workshop, Mayor and Council recommended a thorough review of several employee
programs. Staff developed and implemented the following strategies under the total
compensation approach:
1. Cost Distribution of Total Compensation — Council requested a breakdown
of all costs associated with total compensation. Staff has developed several
graphs to show the cost distribution of each part of the total compensation mix
included in the presentation for Mayor and Council's review.
2. Employee Development — staff amended the current tuition reimbursement
policy. Effective January 1, 2003, General Equivalency Diploma (GED) is
covered, eligible certification classes are covered and employees will be
reimbursed at the State University rate. Employees currently enrolled in
private universities, such as Ottawa, will be extended under the old policy until
December 31, 2003. In addition, certificate and associates degree programs
will be offered on-site through Rio Salado Community College.
3. Health Benefits Renewal Timeline — per Arizona State law, the City of
Glendale is required to go out for rebids on the medical insurance programs
every five years. The Benefits Office is managing the rebid process early to
provide Mayor and Council with benefits costs information prior to the medical
renewal period. This information will be presented at the City Council
Workshop on February 18, 2003.
4. Employee Communication — an extensive communication campaign to
educate city employees on the value of total compensation began the end of
April 2002. Human Resources staff attended over 15 staff meetings in various
departments to provide information and training to employees. Since October
2002, Human Resources staff held over 10 employee focus group meetings to
obtain employees' input and ideas. In addition, the City Manager's Office and
the Communications Department have established new lines of
communication with employees.
5. Employee Total Compensation Statement — in January 2003, employees will
receive total compensation statements reflecting the full monetary value of pay
and benefits programs that they received from the city during calendar year
2002. An example of the benefits statement is enclosed in the presentation.
6. Feedback and Evaluation — staff developed and is testing a number of
intranet/internet-based applications, allowing employees and citizens to
complete many human resources processes online. Enclosed is a survey
developed to measure external customer satisfaction.
7. Total Compensation Task Force — the task force will meet prior to any
recommendations to Mayor and Council for changes or funding for any part of
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the total compensation mix. The task force will evaluate the extent to which
any proposed changes in one part of the mix may impact any other areas.
No additional budget funds are being requested at this time.
Dr. Diggs explained the model began with the Mayor and Council's vision and included
the City Manager's business model. She said they then developed a total
compensation reviewing strategy utilizing input from the task force and Council. She
said the task force included a number of representatives from Human Resources as
well as employees from various other city departments. She explained the task force
attempted to define total compensation as it relates to the city by first reviewing the
definition formed by the American Compensation Association. She said compensation
includes every tangible and intangible benefit that employees receive for their services.
She noted the city is required by law to provide certain benefits, including Social
Security and Worker's Compensation. She explained intangible benefits include tuition
assistance, training programs, awards, flexible work programs, employee assistance
programs and a safe, secure work environment.
Dr. Diggs stated the distribution of compensation and benefits for FY 2001/02 totaled a
little over $104 million. She said nearly 50 percent of the General Fund revenues goes
to fund Public Safety Services, 18 percent goes to public services, seven percent goes
to community development, six percent goes to public works, seven percent goes to
administrative services, four percent goes to the City Manager's Office, and four
percent goes to Non-Departmental. She reviewed a slide depicting total compensation
distribution for total payroll compensation, stating the intangibles are less than one
percent, costing $244,702. She said, while the cost of the intangibles is small, their
value to the employees is great. She then reviewed a slide depicting the total
compensation distribution for the Operating budget, noting total payroll is 45 percent
and the Operating budget is 55 percent. She said the total Operating budget equals
$244 million, with total payroll totaling $100,612,276. She said total compensation
distribution for General and Street Funds for FY 01/02 were 37 percent for payroll and
63 percent for General and Street Funds.
Dr. Diggs stated the total compensation strategies employed by the task force included
employee development, specifically tuition reimbursement. She said they have made a
change to the city's tuition reimbursement policy effective January 1, 2003, explaining it
will include reimbursement for obtaining a General Equivalency Diploma and for
required certifications. She said they would also reimburse at the state university rate,
even if the employee attends a private school. She stated they are also exploring the
opportunity to have an onsite co-work program for Certificate and Associate Degrees.
Dr. Diggs said their original schedule had them returning to Council on February 18,
2003 for approval of a benefit vendor. Ms. Carmicle said Mr. Beasley directed them to
look at holding open enrollment in the fall to allow Council an opportunity to review all
aspects of the compensation package as a whole during the budget process.
Dr. Diggs reviewed their communications plan, stating they want to ensure all strategies
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are aligned with Council goals. She said they would then obtain the City Manager's
approval and conduct department head briefings. She stated their intent is to give
every employee in the organization an opportunity to hear from them, either through
written communication or through meetings. She said employees would be given
training and written materials to ensure everyone has a full understanding of the total
compensation strategy and the language and terminology being used. She noted every
employee would receive an accounting in January of all of the benefits and
compensation they received for the year.
Dr. Diggs stated the total compensation strategies will be evaluated and reviewed and
feedback will be solicited from external customers. She noted they are using the
intranet to provide self-service opportunities to internal customers.
Councilmember Clark asked for an example of flexible and employee assistance
programs. Dr. Diggs said flexible programs include flex-schedules and telecommuting,
while the employee assistance program provides employees with counseling services,
financial assistance and so forth. Councilmember Clark pointed out Page 9 lists total
payroll at $100 million; however, Page 6 lists it as $104 million. Dr. Diggs explained
Page 6 depicts the actual payroll for FY 2002, whereas Page 9 refers to the budgeted
amount. Mr. Beasley offered to provide Council a breakdown of the $4 million
difference.
Councilmember Martinez asked about variable pay and who determines which
employees will receive group and individual bonuses. Dr. Diggs said it is a fairly new
concept and intended to reward employees who, for instance, made tremendous efforts
and dedicate long hours to specific projects. Councilmember Martinez asked how
Glendale's intangible pay compares to other cities. Dr. Diggs said intangibles differ
between the cities; therefore it is difficult to make comparisons.
Councilmember Lieberman asked for an explanation of the $500,000 earnings
adjustment. Ms. Carmicle said for example, an earnings adjustment occurs when an
employee's temporary assignment pay is paid retroactively.
Councilmember Clark asked how a pay adjustment and an earnings adjustment differ.
Ms. Carmicle explained pay adjustments occur when an employee pays the city back.
Councilmember Goulet complimented the task force and Human Resources on the
study. He asked what would happen to the tuition assistance program if the state
universities were to increase their tuition. Dr. Diggs stated the city would amend the
reimbursement rate during the next budget year.
Ms. Carmicle offered to provide a list of all compensation terms. Mayor Scruggs asked
staff to amend the glossary so that it matches the list of expenditures.
In response to Vice Mayor Eggleston's question, Dr. Diggs explained base and variable
pay is subject to I.R.S. tax rules.
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Councilmember Clark asked if an employee has to declare tuition reimbursement on
their taxes. Mr. Lynch stated any compensation provided to employees is recorded as
such for tax purposes. He noted the I.R.S. looks at reimbursements differently if they
are job related. He assured Council that the I.R.S. codes for all taxable items are set
up in the city's payroll system and the appropriate withholdings are made.
Dr. Diggs clarified for Councilmember Lieberman that uniform allowances are paid to
Field Operations, Police and Fire personnel. She offered to provide the number of
employees who currently receive uniform pay.
Councilmember Frate asked how the task force feels about the process. Dr. Diggs said
it was a mutual learning process. Ms. Carmicle explained the task force was selected
based on their previous participation either in the benefits program or in the
compensation program. She said, therefore, the members brought a lot of knowledge
to the task force. John Holland said he learned to appreciate his job with the city.
Paula Moloff said they were not aware of all of the benefits provided by the city.
2. SEWER SERVICE IN AREA WEST OF LUKE AIR FORCE BASE — 1 HOUR
CITY STAFF PRESENTING THIS ITEM: Ken Reedy, Deputy City Manager
RECORP has requested a small package plant approval for sewer service to their
development in the Glendale Strip annexation area. That approval from Glendale is
necessary since the Maricopa Association of Governments (MAG) Water Quality
Management Plan (208 Plan) indicates that Glendale is the planned service provider for
the area.
The 640-acre project is called White Tank Mountain Park Ranch and is located east of
Perryville Road, west of Citrus Road and between Olive and Peoria Avenues. The
master planned development includes 1732 residences, an elementary school,
commercial area. and a small wastewater treatment package plant. None of the
development is inside the 65 ldn noise contours for Luke Air Force Base.
The proposal by RECORP indicates that a small package plant is the temporary
solution to sewer service in the area of Citrus Road and Olive Avenue. In the long term,
they recommend a regional treatment facility and have prepared a feasibility analysis to
show where the regional facility might best be located and what area it would be able to
provide service to. That analysis indicates that approximately twelve square miles of the
Glendale Strip annexation area on the west side of Luke Air Force Base could be
served by a regional facility.
Staff has reviewed the documents presented and generally agrees that the analysis is
appropriate and seems to be accurate. From a technical review standpoint the
proposed solution is feasible. However the proposal also recommends that the service
be provided by Arizona American Water Company (formerly Citizens Utilities). Since the
area is in the Glendale service area the City Council must decide if service to the area
will be provided by the City of Glendale or if the City will allow another service provider
to serve the area.
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Development in this area is happening at an increasing rate. The Planning Department
has reviewed the proposed development and determined that the RECORP project
does comply with the General Plan being prepared for this area.
Another issue in this matter is related to the development outside the Glendale City
jurisdiction. Each housing unit or other development that is constructed in the County
reduces the financial ability of the City to serve the area in the future. All development
that is constructed when we annex the area will not have paid impact fees for city
services. The effect of that situation will play a significant role in the evaluation of what
services the City will be able to afford to construct to make the area truly a part of
Glendale.
If the City were to annex the area, there are many areas that are provided water service
by Arizona Water Company. The City would need to evaluate if the area will continue to
be served by private water utilities or if the City would purchase the service area from
the provider. Also included in the evaluation is the complexity of providing sewer
service to properties that are served water by another service provider. When one utility
provides both water and sewer service, if the customer does not pay their bill the water
shutoff is an effective solution to prevent additional loss of service. When the services
are separated, the provider of the sewer service cannot easily disconnect customers for
non-payment. Due to recent events in the Northwest Valley, there is new concern
about private utilities operating inside a city's jurisdiction. He said the most cost
effective time to acquire the service area would be before the developer completes
construction and dedicates it to the private company.
If the City committed to serving the area, the ideal solution would be to provide both
water and sewer service. Since Arizona American Water Company holds a certificate of
convenience and necessity to provide water to the area; it would be necessary to
purchase the service area from them prior to development to minimize the costs of the
purchase. The Citizen Bond Committee recently recommended that the City Council
seek citizen authorization for bond capacity to allow the orderly development of the
water and sewer system. Those bonds could be a resource for the acquisition of the
service area.
In previous contacts about service to this area the Council was asked to decide if the
City would provide service to the Russell Ranch project at Camelback Road and Citrus
Road. In that instance the Council decided to allow the area in the extreme southwest
corner of the Strip Annexation area to be served by Citizens Utilities in a small package
plant and have the area served in the future by a regional plant the Citizens Utilities was
planning farther west.
No Citizens Participation has been done on this project outside our current jurisdictional
boundaries.
Analysis of the costs are complex and will need to be determined after some direction is
received from the City Council on the policy regarding service to the area. If service will
be provided by the City, much of the costs will be born by the developer to install the
infrastructure including the lines and treatment systems. Any operational costs will be
designed into the rates and fees to recover the costs of operating the systems.
Staff's recommendation would require the developer to construct the water and sewer
facilities to city standards and dedicate them to the City of Glendale. With Council
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concurrence with the recommendation, staff will work with the developer to create
agreements and return for additional discussion of the agreements and the operating
alternatives.
Mayor Scruggs asked about serious development issues in the area referred to as
AUX1, explaining a home is currently being developed in an area where Luke Air Force
planes fly 200 feet above the ground. She said the city has to look at all areas to be
sure they do not inadvertently endorse development in sensitive areas. Mr. Reedy
stated that he was told by the developer that Luke has reviewed the project and does
not object.
Councilmember Clark asked how the project will impact the White Tanks plan,
specifically the county's master plan for those mountains. Mr. Reedy said the only
significant concern he has heard from the County is with regard to who will provide
sewer service.
Councilmember Lieberman expressed his opinion the best thing the city could do would
be to annex the area and let it be developed in a manner the city feels is best. He
pointed out the city would have no say if the area is developed in the county. He said
annexing the area into the city would best protect Luke Air Force Base.
Mayor Scruggs stated it is not simply a noise issue; explaining protection of the
southern departure corridor is imperative. She explained the live ordinance requires
planes taking off from Luke Air Force Base to fly to the southwest. She stated they
need to look at Luke's maps and routes to see how they impact Glendale's strip annex
area. She pointed out Luke has increased the amount of training it conducts because
of the increased need for pilots. She stressed the importance of protecting Luke's flight
corridors, stating that is the city's ultimate goal. She stated Bill 1525 requires a
developer to notify and provide the base with an opportunity to comment on any
proposed developments, even if they fall outside the noise contours. Mr. Reedy said he
will verify that has occurred. Mayor Scruggs pointed out some people would like to see
the protected vicinity expanded.
Councilmember Frate asked if the area has to be annexed into Glendale or if it could be
annexed into Surprise, which is considerably closer. He questioned whether it would be
in Glendale's best interest to annex the area. Mr. Reedy stated that is a Council policy
decision. He explained the current Council policy identifies the strip annexation
boundary established in 1977 as the boundary for what will eventually become
Glendale. He cautioned against de-annexing the area to a city that has not shown the
same level of interest in protecting Luke Air Force Base.
Mayor Scruggs stressed the need to obtain maps depicting Luke's flight paths. She
said the Air Force has told the city they need to have the southern departure corridor
and access to the range located around the White Tank mountains protected.
Mr. Paladini explained a state overlay of compatible uses exists inside the noise
contours and the proposed site is clearly within that vicinity. He pointed out the
developer would be required to disclose the development's proximity to the base and
the associated impacts of its location to potential homebuyers. He said Luke's approval
of the project indicates they do not have a problem with the development. He noted the
proposed zoning of two to three units per acre is consistent with their White Tanks
Master Plan. He said, while annexing the area into Glendale would provide the city with
some control over its development, Glendale would be required by state law to adopt
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equivalent zoning.
Mayor Scruggs asked Mr. Paladini to explain HB1525 and identify the areas that have
defined compatible land uses. Mr. Paladini explained the area within the noise contour
line has a state use matrix and the area outside of the noise contour, referred to as the
vicinity area, requires notification to the base and to potential buyers. He stated the
maximum density for residential development within the noise contour lines is one unit
per acre. He noted schools and other high-density uses are not allowed within Luke's
accident potential zones. He said the county has been fairly good about following the
state matrix and working with Glendale to ensure consistency. Mayor Scruggs pointed
out the area known as AUX1 was zoned several years ago, before anyone knew Luke
used the area for precision flying. She said Supervisor Wilson has been working
diligently with landowners in the area to resolve issues.
Councilmember Lieberman noted Buckeye expects 60,000 to 80,000 homes to be
developed over the next 20 years in the area it recently annexed. He pointed out the
city would only be required to adopt equivalent zoning for six months and then could
change the zoning to fit the city's needs. Mr. Paladini agreed the city could later go
through the down-zoning process. Councilmember Lieberman reiterated his position
that it would be best for the city to annex the area.
In response to Mayor Scruggs' question, Mr. Paladini explained cities couldn't down-
zone a property to agricultural or open space. He stated, however, zoning of two to
three units per acre is consistent with the city's recently adopted General Plan for that
area. Mayor Scruggs pointed out the city received a letter of no objection from Luke
prior to moving forward with the General Plan. She asked to see Luke's response to
the proposed development.
Councilmember Clark said placing residential developments west or south of Luke
would doom Luke in the future. Mayor Scruggs disagreed given Luke's approval of the
proposed project. She pointed out the purpose of the box was to give Luke the
opportunity to comment as to whether a particular development will negatively impact
the base. Councilmember Clark pointed out the proposed density would result in 1,700
homes in one square mile. Mayor Scruggs clarified that she is talking about the city's
legal authority and what they are directed to do by legislation, not the number of homes
they would like to see developed in the area. Councilmember Clark said all of the
Council members agree on the importance of supporting Luke's mission. She stated,
while Supervisor Wilson has been very sensitive to the issue of Luke, there is no
guarantee that all other Supervisors have been or will be sensitive in the future. She
expressed her opinion the real issue is whether Glendale should annex surrounding
lands in order to protect Luke's mission. Mayor Scruggs agreed Council needs to
discuss the city's annexation policy, stating, however, not just to preserve Luke's
mission.
Councilmember Lieberman pointed out the motors on the F22 and F30 twin-engine jets
are more powerful than the F16. Mayor Scruggs said that is why they fought so hard to
keep HB2565 in state statutes, explaining it was built on F15 noise contours.
Councilmember Lieberman noted the $1.5 million appropriated by the legislation in the
last six years has not been put into use. Mayor Scruggs explained $500,000 is
currently being used by the Department of Commerce for a Compatibility Usage Study.
Mayor Scruggs asked to see the letter from Luke wherein they state they find the
proposed use to be compatible, stating she would not want to move forward without
seeing proof of Luke's position. Mr. Beasley agreed Luke's letter is essential to the
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discussion and suggested they return to Council when the letter can be produced.
Councilmember Martinez asked what the project means in terms of cost to the city. Mr.
Reedy explained the developer would be required to construct the improvements to city
standards at its cost. He said the cost of operation could be put on the ratepayers.
Councilmember Martinez asked if the city would have any liability in terms of water
quality. Mr. Reedy stated that is why he recommends the city require the developer to
construct the facility to city standards and dedicate them to the city for operation. Mr.
Reedy noted an Arizona Municipal Water Association meeting was held specifically on
the subject of whether private utility companies should operate inside cities. He said
that group stressed the need for a city to gain control prior to the utility being developed.
Mayor Scruggs asked if the city would have to pay the developer at the time they turn
the facility over to the city. Mr. Reedy explained the city would require the developer to
construct the facility to city standards and give it to the city. Mayor Scruggs asked who
would receive the monthly payments. Mr. Reedy responded the city. Mr. Reedy noted
the city typically does not provide sewer service without also providing water, stating,
therefore, the developer is also required to dedicate water utility services to the city.
Mayor Scruggs directed staff to bring back information concerning the cost of operating
the sewer and water plants and buying water provision rights and how those costs
would affect ratepayers.
Vice Mayor Eggleston said his concern regarding annexing an area so distant from the
city. He said, while they have to consider the development's impact on Luke, assuming
their approval of the project, the city then has to look at what is best for the future of
Glendale.
Mr. Beasley stated they will return to Council after the first of the year with the letter
from Luke and financial information requested by Council. Mayor Scruggs asked Mr.
Beasley to also indicate if the project matches the designations in the city's General
Plan. Mr. Reedy stated the Planning Department has confirmed that it does match.
Mayor Scruggs asked if the owners of package plants that already exist in an area
being annexed are obligated to sell the facility to the city if the city wishes to purchase
them. Mr. Reedy said it varies depending on whether the city has made any prior
agreements with the private providers. He explained the city would be required by law
to acquire the facility at the fair market value or condemn if the owner chooses not to
sell. He said, typically, the owners agree to abandon the package plant because they
no longer want to pay the operating expenses.
ADJOURNMENT
The meeting was adjourned at 3:50 p.m.
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