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Minutes May 16, 198904 CITY OF DENTON CITY COUNCIL MINUTES MAY 16, 1989 The Council convened into the Work Session at 5:30 p.m. in ~he Civil Defense Room. PRESENT: Mayor Stephens; Mayor Pro Tem Ayer; Council Members Gorton, Hopkins and McAdams. ABSENT: Council Members Alexander and Boyd 1. The Council received a report from Coopers and Lybrand representatives on the Management Study and Actuarial Audit of the Employee Insurance Fund. Tom Klinck, Director of Personnel, stated that the study was a part of the 1988-89 budget. In January of 1989, the contract was awarded to Coopers and Lybrand, a firm that had extensive experience with government work and which was currently working with Texas Woman's University and the University of North Texas on their insurance program. The firm was also very familiar with the medical provider climate in Denton. Dave Palatiere, Coopers and Lybrand, presented an.update of the City of Denton medical plan status. He stated that relevant factors in the City's health plan included a medical trend for higher premiums, the physician/provider community, instability of providers, large individual claims for a small employee base, historically lower rates compared to other governmental entities, and a generous benefits package by design. He reviewed the rate increase history which showed a 0-15% increase of the City's rates as compared to other entities with a 50-60% increase in rates. Palatiere presented the rate levels to fund the current benefit structure in relationship to current rates, break even rates for 1988 (premiums versus claims) and break even rates for 1989. This rate structure would assume no deficit recoupment. The plan's financial statistics were then reviewed stating the number of participants in the program, the revenue, expenses and net loss for October 1987-September 1988, actual October 1988- April 1989, and projected October 1988-September 1989. A projected ending fund balance deficit of approximately $1.6 million was seen. Megan Cross, Coopers and Lybrand, reviewed the method of projecting the ending fund balance. Palatiere then reviewed the plan utilization statistics from November 1, 1987 through October 31, 1988 noting the paid claims, top three health problems, top five hospitals serving employees, inpatient costs per day, and fact that four patients accounted for 38% of the total paid claims. City of Denton City Council Minutes May 16, 1989 Page 2 Palatiere then presented various alternatives to the current City health plan. Those alternatives included: (1) Continue the current plan as is with a free choice to use or not use the network facilities. With a 50% increase in rates, this plan would still lose money and there was a concern with competition with HMO. (2) Modify the plan design with provider arrangements for a per diem amount for hospital stay. If the network facility were not used, the plan would only pay the per diem amount and the employee would be responsible for the remainder. A 90% rate increase would be necessary for break even status with this alternative and negotiations would be necessary with providers for an acceptable per diem amount. There was a concern with HMO competition. (3) Plan Design A would be similar to (2) except if the network provider was not used, only 50% of the charges would be covered. An 80% increase was needed to break even with again a concern with HMO competition. (4) Plan Design B would pay 50% of all charges with a 40% increase in rates. Concern would be present with HMO competition due to the plan design. (5) Plan Design C would increase the deductible to $2,500 and would encourage employees to use the Delta Plan. A problem with this alternative was the at the present time, only 17% of the City's employees participated in the Delta Plan ~nd would not be seen as a benefit. 05 Council Member Boyd joined the meeting. (6) Terminate the medical plan and pursue HMO coverage was the last alternative presented. Palatiere also stated that additional options were being explored through the Texas Municipal League and from independent insurance carriers for the City health plan. Council Member Gorton felt that considering the history of HMO's in the area, employees may not trust them and there would not be a mass exodus to the HMO's as may be feared. Palatiere stated that the HMO was an option but not a very good option. He felt it would not be known until open enrollment how the employees actually felt about the HMO and that it was crucial for as many employees as possible to learn about the options available. Lloyd Harrell, City Manager, then presented two staff suggestions for Council and asked for direction. Those suggestions were (1) the formation of employee focus groups to help inform all employees of the status of the health fund and to receive feedback from employees regarding alternatives for the program, and (2) a strategy for the elimination of the projected $1.6 million deficit by year end. A plan was needed 06 City of Denton City Council Minutes May 16, 1989 Page 3 to reduce most, if not all, of the deficit. Harrell presented a suggested plan of action for this reduction and stated that formal budget amendments would be necessary. Consensus of the Council was to proceed with the focus groups and the amendments to the budget as proposed. 2. The Council convened into Executive Session to discuss legal matters, real estate, and personnel/board appointments (considered appointments to the Bicentennial Census Complete Count Task Force and an appointment to the Board of Managers of the DENCO Area 9-1-1 District) The Council then convened into the Regular Session at 7:00 p.m. in the Council Chambers. PRESENT: Mayor Stephens; Mayor Pro Tem Ayer; Council Members Boyd, Gorton, Hopkins and McAdams. ABSENT: Council Member Alexander The Mayor presented the following individuals with certificates for outstanding property in the "Keep Denton Beautiful" project: Mr. and Mrs. Frank Massey, Mr. and Mrs. James Garllng. Ed and Jeane Morrison, Mr. and Mrs. James Payne, and Ms. Claire Lloyd. 1. The Council received a citizen's Mr. Bob Powell regarding City participation dealing with the Upper Trinity Water District. report from in legislation Mr. Powell felt that the legislation had not addressed the people who would be responsible to pay for the District. He stated that the fault was a lack of direct accountability to Denton County by the Board of Directors with a poor method of selection for the Board. He felt that the legislation needed to make the Board accountable to Denton County. He asked the Council to reconsider support of the legislation - not the concept of the District but rather accountability of the Board. He suggested that the bill be rewritten so as to not put burden on Denton County taxpayers. Lloyd Harrell, City Manager, reviewed the sDecifics of the legislation. He stated that there would be no election for creating the overall District but that the overall District would have no taxing power. The subdistricts would require an election before formal adoption and election for Board members. There could not be a subdistrict in an ETJ or in a municipality without approval of that municipality. City of Denton City Council Minutes May 16, 1989 Page 4 Council Member Boyd asked if it were correct that the only way to Dwe money i~ the District was if a city contracted or a water supplier contracted ~or services with the District. Mayor Pro Tem Ayer stated that the only way a city would be obligated was through a contract with the Agency with the approval of the city council of that city. Austin Adams, Upper Trinity Water District, presented the philosophy of the subdistricts as set out in the legislation. Consent Agenda Mayor Stephens asked that Item 2.B.1. be pulled for special consideration. McAdams motioned, Hopkins seconded to approve the Consent Agenda with the exception of 2.B.1. Motion carried unanimously. A. Bids and Purchase Orders: 1. Bid #9974 - Landmark Company Item 2.B.1. was considered. Mayor Stephens expressed concern with regards to the closing of Myrtle Street. He stated that there were small businesses in that area which used Myrtle Street on a regular basis and questioned how they would have access to their businesses if Myrtle Street were closed. Frank Robbins, Executive Director for Planning, presented the proposed plan for the closure and indicated that the businesses would have access from the north but not from the south. Council Member Hopkins asked if the street could possibly be left one-way in order to accommodate the businesses in the area. Robbins stated that even if the street were left open, it would continue to create a traffic problem. A discussion was held regarding traffic problems and patterns in the area. Barrier placement and alternatives for traffic flow were also discussed. Gorton Item 2.B.1. motioned, McAdams seconded to approve Consent Agenda Motion carried unanimously. Be Plats and Replats Considered the preliminary plat of the Eagle Point Shopping Center, Lots 1 through 5. (The Planning and Zoning Commission recommended approval). 07 O8 City of Denton City Council Minutes May 16, 1989 Page 5 3. 'Ordinances A. The Council considered adoption of an ordinance accepting competitive bids and providing for the award of contracts for public works or improvements. The following ordinance was considered: NO. 89-062 AN ORDINANCE ACCEPTING COMPETITIVE BIDS AND PROVIDING FOR THE AWARD OF CONTRACTS FOR PUBLIC WORKS OR IMPROVEMENTS; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFOR; AND PROVIDING FOR AN EFFECTIVE DATE. McAdams motioned, Gorton seconded to adopt the ordinance. On roll vote, McAdams "aye, Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. B. The Council considered adoption of an ordinance approving an agreement providing for the lease of office space at 1607 East McKinney Street. Council Member Hopkins stated that she wanted it understood by both the Domino Club and the Council, as she understood it, that this was a one time contract for 12 months only. The Club would move to the Senior Center when completed or the City no longer would have any obligation to them. This was not to be a long term recurring lease. She also questioned the item stating that the City would be responsible for telephone services. As she understood it, that was to have been taken out of the lease. Lloyd Harrell, City Manager, stated that the sublease between the City and the individuals from the Domino Club would specify that the City would not be responsible for telephone and gas service. Council Member Hopkins asked for someone to state that her understanding was correct as to the duration of the lease and the obligation of the City. Mayor Stephens and Council Member Gorton both agreed that the lease was to be for one year. Debra Drayovitch, City Attorney, stated the lease could read that the lease would end upon expiration of the term. Presently, there was an option to renew the lease but it was not binding. City of Denton City Council Minutes May 16, 1989 Page 6 Steve Brinkman, Director of Parks and Recreation, stated that that particular clause was put in the lease so that there might be an option to renew if for some reason the Senior Center were not completed on time. Council Member Gorton stated that the agreement before them was between the City and the Bank and that the subsequent agreement between the City and the Domino Club for use of the facility would address many of the issues that had been brought up. The following ordinance was considered: NO. 89-063 AN ORDINANCE APPROVING AN AGREEMENT PROVIDING FOR THE LEASE OF OFFICE SPACE AT 1607 EAST MCKINNEY STREET, AND DECLARING AN EFFECTIVE DATE. Gorton motioned, McAdams seconded to adopt the ordinance. On roll vote, McAdams "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. 4. Resolutions A. The Council considered approval of a resolution creating a Census Complete Count Task Force to plan and implement local promotional activities for the 1990 census. The following resolution was considered: RESOLUTION NO. 89- -- A RESOLUTION CREATING A CENSUS COMPLETE FORCE TO PLAN AND IMPLEMENT LOCAL ACTIVITIES FOR THE 1990 CENSUS. COUNT TASK PROMOTIONAL Gorton motioned, Ayer seconded to approve the resolution. Mayor Pro Tem Ayer questioned whether this Task Force would allow appointment of individuals who were not members of the City of Denton. The resolution as written stated that the Task Force would be composed of residents of the City of Denton. City Attorney Drayovitch stated that several years ago, the Council passed an ordinance requiring all committee members except for certain ones, must reside within the City limits. It would be possible to amend that ordinance to provide that task forces that were created and established for a specific purpose and that would be disbanded upon completion of their charge, could be comprised of members other than residents of the City of Denton. 0¸9 City of Denton City Council Minutes May 16, 1989 Page 7 Council Member withdrew his motion. Ayer motioned, Gorton seconded to instruct the City Attorney to draft a proposed ordinance amending the current ordinance which prohibited non-residents from serving on committees to allow non-residents to serve on task forces. On roll vote, McAdams "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. Gorton motioned, Ayer seconded to postpone consideration of the above resolution until June 13, 1989. On roll vote, McAdams "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. B. The Council considered approval of a resolution approving the 1989 Final Statement of Objectives and Projected Use of Funds for the City's Community Development Block Grant Program. (The Community Development Block Grant Committee recommended approval). The following resolution was considered: RESOLUTION NO. R89-035 A RESOLUTION BY THE CITY OF DENTON, TEXASt AUTHORIZING THE CITY MANAGER TO SIGN AND SUBMIT TO THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT A FINAL STATEMENT OF OBJECTIVES AND PROJECTED USE OF FUNDS WITH APPROPRIATE CERTIFICATIONSt AS AUTHORIZED AND REQUIRED BY THE HOUSING AND COMMUNITY DEVELOPMENT ACT OF 1974, AS AMENDED; AND PROVIDING FOR AN EFFECTIVE DATE. Boyd motioned, Hopkins seconded to approve the resolution. On roll vote, McAdams "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion carried unanimously. C. The Council considered approval of a resolution authorizing the Police Department to use unmarked vehicles. The following resolution was considered: RESOLUTION NO. R89-036 A RESOLUTION AUTHORIZING THE POLICE DEPARTMENT TO USE UNMARKED VEHICLES; AND PROVIDING FOR AN EFFECTIVE DATE. Ayer motioned, Gorton seconded to approve the resolution. On roll vote, McAdams "aye," Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye," and Mayor Stephens "aye." Motion ca~ried unanimously. City of Denton City Council Minutes May 16, 1989 Page 8 De The Council considered approval of a resolution postponing the regular City Council meeting of June 6, 1989 to June 13, 1989. The following resolution was considered: RESOLUTION NO. R89-037 A RESOLUTION POSTPONING THE REGULAR COUNCIL MEETING OF JULY 4, 1989 TO JULY 11, 1989; AND PROVIDING FOR AN EFFECTIVE DATE. Gorton motioned, McAdams seconded to approve the resolution. On roll vote, McAdams 'aye,' Hopkins "aye," Gorton "aye," Ayer "aye," Boyd 'aye," and Mayor Stephens "aye.' Motion carried unanimously. E. The Council considered approval of a resolution closing a portion of North Lake Trail between Bowling Green and Auburn on May 21, 1989. The following resolution was considered: RESOLUTION NO. R89-038 -A RESOLUTION TEMPORARILY CLOSING NORTH LAKE TRAIL BETWEEN BOWLING GREEN STREET AND AUBURN STREET ON SUNDAY, MAY 21, 1989; AND PROVIDING FOR AN EFFECTIVE DATE. Ayer motioned, McAdams seconded to approve the resolution. On roll vote, McAdams "ayes" Hopkins "aye," Gorton "aye," Ayer "aye," Boyd "aye,' and Mayor Stephens "aye." Motion carried unanimously. Se Miscellaneous matters from the City Manager Lloyd Harrell, City Manager, presented the following item: A. H. B. 1106, regarding indigent health care, was passed by the House with amendments and was ready for the Governor's signature. 6. There was no official action taken during the Work Session Executive Session. 7. There were no items of new business suggested by Council Members for future agendas. 11 12 City of Denton City Council Minutes May 16, 1989 Page 9 8. There was no Executive Session held during the regular session. With no further business, the meeting was ~djourned at 8:40 p.m. CITY OF DENTON, TEXAS 3100C