Minutes - Council Work Session - 05/01/2012

Home

Public Works Director Olson stated he is unable to answer the question about reduction in the level of service or who will take on the burden of the work he has undertaken over the course of the last 12 years. City Administrator Ulrich stated the budget as presented in the last scenario would use more contracted services and leave a base of staffing, which could include an intern. That proposal has not been reviewed by the Personnel Committee. He explained the Public Works Director position can be filled, replaced with a consultant, partly covered by an engineering intern, or not replaced and the work responsibilities divided among staff. He supported a solution that kept the money in the budget at a full funding level to allow for either scenario because those duties need to be covered in some form or another, especially if road projects are increased. Councilmember Elvig noted cuts in engineer are a "double whammy" because outsourcing engineering also outsources the revenue stream and budget projections include some revenue from projects. Finance Officer Lund stated the amount is $236,000 and she had factored in a $100,000 decrease. Public Works Director Olson explained that over the course of the last three years, the Engineering Department has provided more revenue than expenditures. Councilmember Elvig asked what is the impact to Engineering staff if the Council adds $3 million of road projects. Public Works Director Olson expressed concern with staff's ability to handle that level of road projects if his position is not filled. He explained how project costs and contingencies are calculated, noting some consulting engineers charge a 24% overhead and staff generally charges 18-21% but it can be as low as 15 %. Councilmember Elvig agreed there is an anomaly with engineering and if talking about raising funds, the City can either keep it in house and parlay those funds, or pay it out of house. He stated he wants to make sure the City maximizes its net revenue capture. Mayor Ramsey stated staff can figure that out but he wants to protect against saying the City needs a level of staff to maximize money coming in for six months but then carrying those staff costs the other six months. Councilmember Elvig noted that is why staff uses interns and consultants for peaks. Councilmember McGlone asked why government does not just charge what it costs. Public Works Director Olson stated from an engineering's perspective, the beauty of staffing for baseline improvements is the flexibility to stop plan preparation and do plan review if growth starts. In addition, it provides more consistency in how residents are treated. He noted that last year, staff was so busy that it could not respond to resident's concerns as fast as it wanted to. City Council Work Session / May 1, 2012 Page 9 of 15