Finance Committee Meeting Minutes February 15, 2017

For your consideration, please review the minutes from the Finance Committee Meeting on February 15, 2017:

Finance_Committee_Meeting_Minutes_February_15,_2017_with_Attachments

To read the minutes please open or download the pdf from the link above, or you may see more below:

Brunswick-Glynn County Joint Water & Sewer Commission

1703 Gloucester Street, Brunswick, GA 31520

Commission Meeting Room

Wednesday, February 15, 2017 at 2:00 PM

 FINANCE COMMITTEE MINUTES

PRESENT:                             

Donald M. Elliott, Chairman

Steve Copeland, Commissioner

Mike Browning, Commissioner

Jimmy Junkin, Executive Director

John Donaghy, Chief Financial Officer                                          

ALSO PRESENT:                 

Thomas Boland, Deputy Director

Charles Dorminy, Legal Counsel

Pam Crosby, Director of Procurement

 Chairman Elliott called the meeting to order at 2:00 PM.

 PUBLIC COMMENT PERIOD

There being no citizens that wished to address the Committee, Chairman Elliott closed the Public Comment Period.

ADOPT:

  1. Compensation Policies – J. Donaghy

John Donaghy discussed the proposed amendments to the evaluation and compensation policies and procedures packet to the Committee.  He explained that the process had started previously when the performance evaluation form was reviewed due to it being a one size fits all type of evaluation.  It has some duplication within the form.  There were criteria included which were not applicable to all employees.  The proposal is for the actual evaluation form itself be changed to incorporate more applicable attributes to the nature of the job the employee is performing, along with the revision of the compensation policies.  Under the current system employees are evaluated on their hire date or hire date in position anniversary and receive a pay increase based on their evaluation score, which in effect awards a percentage increase in salary based on a chart.  With the evaluations happening every month, it affects planning for the upcoming fiscal year due to wages changing throughout the year.  Under the proposed system, they are proposing that a cost of living increase be granted to all employees on July 1st of each year based on the previous year’s CPI index. Then, during the year with the evaluation, if the employee just meets standard, they receive no further increase. The evaluation form rates the employee from 1 to 5.   If one gets a 3, they just meet standard.  If an employee scores a 4, they do receive a step increase.  If they score a 5, they receive 2 step increases.  So, if an employee is just meeting standard in their position, they will not get a step increase.  This type of system should make the budgeting more predictable. A maximum salary growth percentage for the year is proposed to be a total of 5% which would include the COLA and the 2 step increases. The additional proposed change is to revise the Condrey Salary Scale that was implemented in 2015 and increasing that scale each year by the COLA for the salaries would keep pace with the Cost of Living Increases each year.  There is also a “top out” provision where if someone does reach the top pay in their grade, they would only receive the COLA as a one time payment for that year rather than a cumulative growth of their salary after that point. If an employee does not perform above just meeting standard performance, they will be advised of growth expectations and if they are rated at a 1 or 2, they would be required to follow a performance improvement plan in order to maintain their job.  Another proposal put forth is for the probationary period of a new hire to be increased from 6 months to 1 year.  This proposal has been brought before the Human Resources and Finance Committees from the previous Commission.  These proposals were not put into place for Adoption or Approval, but are to be brought back before the Human Resources & Safety Committee and then the Full Commission later in March.

  1. Intergovernmental Agreement – C. Dorminy

Charles Dorminy discussed the Intergovernmental Agreement and explained that in order for JWSC to have control over the SPLOST proceeds for the North Mainland projects, an Intergovernmental Agreement between the City, the County and JWSC must be put into place.  Otherwise, JWSC will not be reimbursed for the project expenditures if they proceed with them.  If the agreement is put into place, then the JWSC can have direct disbursements from the SPLOST funds for those projects.  The draft of the Agreement is still in process with the County’s Legal Counsel. The Intergovernmental Agreement is deferred for Adoption or Approval until the draft is ready and it has been brought before the Commission.

DISCUSSION:

  1. January End of Month Financial Comparative – J. Donaghy

John Donaghy presented the financial end of month report for January 2017 to the Committee.  On the Balance Sheet it is reflected that the Cash and Cash Equivalents have increased significantly from June 30, 2016 to January 31, 2017.  Part of this is due to the need to transfer some of the funds to the balances in restricted reserves and capital needs reserves.  When these transfers are made, that will reduce some of the cash balance. The bond sinking fund has increased from $300K to $1.6 M due to the accumulation of the funds from the bond trustee for the next principal and interest payment that will be due June 1st of 2017. Accounts Receivable have gone up mainly due to rate increases, even though they have not been as aggressive in collection efforts due to the implementation of new software. Under Restricted Cash Accounts, the JWSC Reserves have gone down from $16.3 M to $12.7 M, with the direct offset of that being in the Capital Assets and Construction in Progress increasing form $3 M to $6 M. Under Current Liabilities, the Accounts Payable has gone down from $2.2 M to $400 K, which is due to the process at the end of the previous fiscal year requiring that the books to be held open longer and allow lagging invoice to come in and record those.  This is not done on a normal monthly basis.  Under long term debt, there shows $38.7 M outstanding at the time, which is due to the Long-Term portion of the Bond Payable and the Long-Term Portion of Capital Lease which was for the purchase of 4 new Vac-Con Machines under a capital lease.  The Schedule of Cash Balances was also discussed, which indicated the amounts of the Capital Improvement Fee Reserves that are being held for Capital Improvements in the 4 separate districts of which the JWSC is currently restricted to use in those districts specifically. The Commission Report listed by Departments was then reviewed and discussed, as well as the Project Report for 2016-2017.  The Project Report gave the Total Project Costs to Date along with the Balance to Complete for each Project.  The overtime budget versus actual was discussed in detail, and is to be confirmed as to whether the numbers being reflected are Pro Rata or actual.

DIRECTOR’S UPDATE

Mr. Junkin expressed that he does have concerns about JWSC’s long term financing.  After review of the Master Plan and projects that he realizes need to be addressed, he indicated his belief that the current business model the JWSC has is not going to hold the organization for the next 5 years.  He discussed a need to meet with Representative Carter in the case he can help JWSC with assistance from the federal government for capital projects and improvements such as those projects required at the FLETC and in understanding the big picture for those capital needs.

Thomas Boland added positive commentary to the meeting regarding that 5,000 feet of the pipe has been laid in the ground down Frederica Road on St. Simons Island for Project 505/PS 2032 Force Main Improvements, and with 2 more pulls they will be starting down Palmetto toward the plant.  There have been very few traffic delays.  T.B. Landmark is the contractor for this project, which is going very smoothly at this time.

Meeting was adjourned at 2:54 p.m.