Finance Committee Meeting Minutes – Wednesday, June 17, 2020
For your consideration, please read the minutes from the Finance Committee Meeting that was held on Wednesday, June 17, 2020 at 3:00 p.m. in the Commission Meeting Room.
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, June 17, 2020 at 3:00 PM
FINANCE COMMITTEE MINUTES
Bob Duncan, Committee Chairman
Donald Elliott, Commissioner
Andrew Burroughs, Executive Director
Ben Turnipseed, Commission Chairman
Charles Cook, Commissioner
John Donaghy, Chief Financial Officer
LaDonnah Roberts, Deputy Executive Director
Charlie Dorminy, Legal Counsel, H.B.S.
Janice Meridith, Executive Commission Admin.
Tripp Stephens, Commissioner
Chairman Duncan called the meeting to order at 3:00 PM.
Commissioner Elliott made a motion seconded by Commissioner Duncan to add as Item #5 for Approval and forwarding to full Commission a Leak Adjustment Request for Baymont Inn & Suites. Motion carried 2-0-1. (Commissioner Stephens was absent from the meeting.)
PUBLIC COMMENT PERIOD
There being no citizens that wished to address the committee, Committee Chairman Duncan closed the Public Comment Period.
- Minutes from the May 20, 2020 Finance Committee Meeting
Commissioner Elliott made a motion seconded by Commissioner Duncan to approve the minutes from the May 20, 2020 Finance Committee Meeting. Motion carried 2-0-1. (Commissioner Stephens was absent from the meeting.)
- Minutes from the May 20, 2020 Finance Committee Executive Session
Commissioner Elliott made a motion seconded by Commissioner Duncan to approve the minutes from the May 20, 2020 Finance Committee Executive Session. Motion carried 2-0-1. (Commissioner Stephens was absent from the meeting.)
- Surplus Equipment and Inventory – A. Burroughs
Mr. Burroughs commented that as part of the ongoing review of the assets in inventory, it was determined that there are 3 push cameras that can be surplused. They have various malfunctions, more so with electronic issues, color issues or flashing issues on the screen. Staff is recommending to surplus these 3 push cameras, which will then be placed on GovDeals to determine if anyone would like to purchase them. This will clear them off of the asset list.
Commissioner Elliott made a motion seconded by Commissioner Duncan to move that the Finance Committee recommend that the full Commission review and approve the above referenced items be declared as surplus and disposed of in a manner mist beneficial to the JWSC.
Commissioner Duncan asked how many cameras JWSC maintains, and Mr. Burroughs responded that there are 2 CCTV trucks that each have 2 separate cameras on them; one is a lateral launch camera that can go up in a 4-inch lateral and then there is the main camera which is on wheels and more of a robotic that goes down the line and has a cable on the end of it. He added that there are a few of the push cameras which allow staff to go in from the top side of a lateral and come back down in the case the lateral camera won’t go far enough, these push cameras can also be used in manholes.
Commissioner Cook asked how long items are left on GovDeals for sale. Mr. Burroughs provided that they are on the site for 30 to 60 days, long enough to determine if there is any interest. If no interest, the items are normally scrapped.
Motion carried 2-0-1. (Commissioner Stephens was absent from the meeting.)
- Pump Station 4003 Contract Award – A. Burroughs
Mr. Burroughs provided that this is the approval for the Pump Station 4003 SPLOST Project in the City of Brunswick. Bids were solicited and five bids were received for that Project which will include new pumps, new piping, a new odor control system, and a new wet well at that facility. The low bid was from Petticoat-Schmitt Civil Contractors out of Jacksonville at $1.99M, which is under budget and the anticipated project duration is 240 consecutive calendar days. Mr. Burroughs noted that there was a gap in-between the bid from Petticoat-Schmitt and the other providers, and that staff has spoken with them to ensure that their numbers are firm and they are satisfied with the bid as submitted. He added that most of the difference in price was in the installation of the wet well, however there was one other contractor that was cheaper on the wet well than Petticoat-Schmitt, so there does not appear to be any imbalance issues. Commissioner Elliott asked what kind of wet well was going in, and Mr. Burroughs responded that it is a 12 x 14 pour in place concrete wet well that will be lined with calcium-aluminate. Commissioner Duncan asked if this was immediately adjacent to the existing station, and Mr. Burroughs said yes that the existing wet well is on the north side of the station and the new wet well will be poured on the south side of the station; and the other wet well will be filled with sand with holes drilled in the bottom of it so that water will drain out of it.
Commissioner Elliott made a motion seconded by Commissioner Duncan to move that the Finance Committee recommend awarding the contract for Lift Station 4003 Upgrades 2016 SPLOST Project No. 703 to Petticoat-Schmitt Civil Contractors, Inc., in the amount of $1,998,690.00.
Commissioner Elliott inquired about the alternate bid items and asked if there were going to be done. Mr. Burroughs advised no, that the alternate was an odor control system from a different manufacturer which would simply be replacing one type system with another, and with the lower bid being the base bid the alternate bid was not accepted.
Motion carried 2-0-1. (Commissioner Stephens was absent from the meeting.)
- Leak Adjustment – A. Burroughs
Mr. Burroughs stated that the Baymont Inn & Suites had a sizeable leak during last year, and according to Ordinance anything over $2,000 must come before the Commission for approval. He referenced the calculation of the leak amount plus the system generated late fees which all totaled a leak adjustment of $2,653.38.
Commissioner Elliott made a motion seconded by Commissioner Duncan to move that the Finance Committee recommend approval of the leak adjustment in the amount of $2,653.38 to the account of Baymont Inn & Suites, and to forward this item to the full Commission. Motion carried 2-0-1. (Commissioner Stephens was absent from the meeting.)
- Self-funded Health Insurance Update – L. Roberts
LaDonnah Roberts recalled for the Committee that at the May 20th Committee Meeting staff presented a proposal to transition the employees from a health insurance coverage that is fully-funded to a self-funded plan. The full Commission did vote at the May 21st Commission Meeting to move forward with that proposal. Mrs. Roberts updated the Committee that since then, the process of updating the plan document and the summary plan descriptions have been started, and also a new period of Open Enrollment was started back on June 9th with conference call meetings held with the employees regarding Open Enrollment and the new self-funded insurance plan. Teamwork Services is contacting everyone who is on a Flexible Spending Account separately since with the change they are truncating the current plan year. The FSA is to be a 12 month plan year that will begin again on August 1st of 2020. There will have only have been a 5 month plan between March 1st and August 1st so Daphne Gable from T.S.I. met with each employee on a FSA plan and discussed their options with the Flexible Spending Accounts. Mrs. Roberts provided the next steps in this process of changing from fully-funded to self-funded health insurance. Staff is working forward to finalize the open enrollments of which 69 people still needed to complete. Staff and TSI are to meet with United Healthcare via WebEx next week to discuss administration of the plan, payment processes, how JWSC will pay UHC administrative fees, how JWSC will pay claims, etc.
Commissioner Elliott asked if there were any objections by any of the employees. Mrs. Roberts advised there were not and once everything was explained to them and they understood that their deductions and coverage were not going to change, and that all that was being asked of the employees was to enroll again to ensure that the coverage they had chosen earlier in the year was what they still wanted. This actually gave the employees the opportunity to make any changes to their plan if they chose to, as well as extended the deductible time frame to 17 months, the first 5 months plus the next 12 months. After this plan year, the time period will return to a 12 month time frame. Mr. Burroughs added that most people asked if they were going to be charged more, and did they need a new insurance card. They will not be charged more and they will receive a new insurance card with the same numbers. He also noted that the employees were informed of the plan next year to add the incentive for good B.M.I. and smoking cessation.
- Financial Statements Month End May 31, 2020 – J. Donaghy
Mr. Donaghy highlighted the Financial Statements for the month ending May 31, 2020 for the Finance Committee. First he discussed the Balance Sheet and noted the Cash and Cash Equivalents balance of almost $3.4M at the end of May. He commented on the Bond Sinking Fund being larger at $3.4M and on June 1st the bond payments will be made so that fund will decrease significantly. On the Schedule of Cash Balances the Elected Reserves established by the JWSC Commission, now shows a Group Insurance Reserve which was previously the Expansion Reserve which was renamed to cover the Self-Funded Insurance. Mr. Donaghy advised that there was significant cash in the investment accounts to transfer that money back over and fully fund that with an account at BB&T, where the money will still earn interest at BB&T but is separately funded. The Combined Revenue Statement was reviewed next, with notations on the 11 months ended May 31, the year to date actual net revenues before Capital Fees and SPLOST is $1.16M, with approximately $600K of outstanding encumbrances of which some will not be liquidated by fiscal year end and are not carried over from one year to the next. Mr. Donaghy added that what is not paid by the year end is closed out and new purchase orders are created towards the new fiscal year’s budget. He provided that projecting from those numbers, we are looking at $1.5M using percentages as far as the customer revenues and a pro-rata for the expenditures for the year. By this fiscal year end we should be somewhere between $1M and $1.5M in revenues over expenditures. Mr. Donaghy advised that there will be some year-end adjustments involved in the audit process that will affect that number, and also a sizeable inventory adjustment pending for the Water Division after the inventory has been checked and items that are no longer of use to the JWSC are removed from inventory. There will also be an adjustment due to the allowance for doubtful accounts, which is the estimate of the accounts receivable that will not be collected which currently is estimated at about $800K. The final portion of the Financial Statement that was reviewed was the Reserve Balance Summary.
Committee Chairman Duncan briefly summarized that the value of the Utility has increased due to the capital investments we have made in the fiscal year; Cash Reserves are obviously sufficient for us to continue business; our forecast for the fiscal year end this month is on a positive note even though we have had some uncertainty since the beginning of the calendar year; and in his view what this reinforces is very good execution on the operation of the company such that it generates financial flexibility for us, so that when we have uncertainty we can still land where we planned to land. Commissioner Duncan added that all of this also reinforces to our customers because again we look forward another year and say that we are not increasing the rates, and he noted a “thank you” to the entire JWSC team from everybody who is on the crew to all administrative staff in that we are just about to close out another fiscal year with a very positive story. Thank you.
Mr. Donaghy commented that the organization is in a very good financial condition. Commissioner Duncan also thanked Mr. Donaghy for what he has done, and commented that it has been a pleasure to work with him for the last couple of years and to get to know you and I appreciate what you deliver, your stewardship and mentoring to your team; Thank you very much.
Committee Chairman Duncan asked if there any other items to discuss.
Mr. Burroughs stated that JWSC did receive the official signed copies back on the GEFA Loan. Those documents were signed by JWSC at the last Commission Meeting. Now GEFA has returned their copies signed, and the Origination Fee is due by January 15, 2021 which we are more than prepared to pay so we can start drafting that account as work is available.
There being no further business, Chairman Duncan adjourned the meeting at 3:24 p.m.