HomeMy WebLinkAbout1988-08-30 - City Commission Workshop Meeting Minutesti of rgM99
7525 NORTHWEST 88TH AVENUE 0 TAMARAC, FLORIDA 33321-2401
TELEPHONE (305) 722-5900
August 25, 1988
NOTICE OF
CITY COUNCIL
WORKSHOP MEETING
There will be a Workshop Meeting of the City Council on
Tuesday, August 30, 1988 at 10:45 a.m. or immediately
following the City Council Meeting scheduled for 10:00 a.m.,
in Conference Room #1 (Room 103), City Hall, 7525 N.W. 88th
Avenue, Tamarac, Florida.
The purpose of this meeting is to review the Utilities
budget, Utility rates and other related budgetary matters for
Fiscal Year 1988/89.
All meetings are open to the public.
•
Carol A. Evans
City Clerk
CAE/nr
AN EQUAL OPPORTUNITY EMPLOYER
POLICY OF NONDISCRIMINATION ON THE BASIS OF HANDICAPPED STATUS
CITY OF TAMARAC
CITY COUNCIL BUDGET WORKSHOP MEETING
TUESDAY, AUGUST 30, 1988
TAPE 1
CALL TO ORDER: Mayor Abramowitz called this meeting to Order on
uesday, August 30, 1988 at 11:00 A.M. in Conference Room #1 (City
erk's Office).
PRESENT:
Mayor Norman Abramowitz
Vice Mayor ,lack Stelzer
Councilman Dr. H. Larry Bender
Councilman Bruce Hoffman
Councilman Henry Rohr
ALSO PRESENT
John P. Kelly, City Manager
Ken Burroughs, Finance Director
Pauline Walaszek, Special Services
Secretary
UTILITIES BUDGET
City Manager Kelly said the primary purpose of this
meeting was to discuss the disposition of the surplus
funds in the TUW Account. He said the City Council
received recommendations from the Finance Director and
the Director of Utilities Engineering regarding the
recommended options for the surplus. He said he would
recommend that some type of surplus be maintained and he
was opposed to reductions in the Debt Service because of
the fluctuation of rates this would cause. He said the
rates for water and sewer presently being charged should
be addressed.
C/M Hoffman said asked if the Debt Service was a rate
marked "Debt Service" and City Manager Kelly said the
Debt Service was a source of revenue.
C/M Hoffman said the Debt. Service was placed in the
General income of the Utilities Department for expenses
and City Manager Kelly agreed.
C/M Hoffman said he was concerned with how 1.5 million
dollars could be accumulated as surplus in 1-1/2 years
without over charging the residents. He said if the City
was overcharging, it should be stopped; however, if the
City was not overcharging an explanation of how the
surplus was being accumulated was needed.
C/M Hoffman said before he could recommend how the
surplus should be used, he would like to receive an
explanation. He said the City Council has been informed
for several years that certain rates had to be charged in
order to comply with the City's needs. He said the City
Council has approved the rate structures recommended by
the Utilities Department.
C/M Hoffman said in 1985, the rates were increased from
30% to 50%; however, he was not a Councilmember at this
time and he could not say why this occurred. He said he
would like an explanation of why the rates were increased
and if the rates may have been increased too much.
Page 1
8/30/88 - Workshop
Bob Foy, Director of Utilities/Engineering, said in
Fiscal Year 1985/86, the rates were increased because of
a rate study. He said the rates were changed from $.60
to $.80 per thousand gallons of water. He said the
service availability remained the same which was $4.65
and has remained at this cost since 1982. He said the
sewer rate was increased from $.70 to $1.50 and the
service availability was reduced from $6.20 to $4.90. He
said the rate change adjusted the single family bills
from $18.35 to $22.82, which was an increase of
approximately 25%. He said it had been anticipated that
there would be capital replacements completed by the
Utilities Department and, after reviewing the study, he
found that there were approximately 1.5 million dollars
in capital improvements budgeted for Fiscal Year 1985/86.
He said he determined that the rate increase generated
revenue of approximately $850,000.00.
Mr. Foy said for Fiscal Year 1986/87, the Utilities
Department without a rate study, increased the water
rates from $.80 to $1.04 and the service availability
remained the same. He said the sewer rates were
increased from $1.50 to $1.61 and the service
availability was increased from $4.90 to $5.70. He said
at this time, the Debt Service of $4.15 was instituted
for sewers. He said he figured that the revenue
increased to 1.4 million dollars and the increase in the
rates was required because this was the first year the
City had to begin paying for the Sewer Bond. He said the
payment of the Sewer Bond was l.2 million dollars and he
could not find information regarding where the remaining
$200,000.00 was applied.
Mr. Foy said he wanted the City Council to be aware that
the rates were increased during Fiscal Year 1985/86
because of the Montgomery Study which included some 41
capital improvements. He said in reviewing this matter a
surplus of $300,000.00 was present over the capital
improvements. He said the second rate increase occurred
because of the Sewer Bonds.
C/M Rohr said the accumulation of surplus presently was
created because of an under estimated revenue and
expenditures for capital projects. He asked if the
increase in rates were established for anticipated
capital improvements. Mr. Foy said certain projects were
budgeted each year from the list of projects he presented
to the City Council.
C/M Rohr said he was concerned with a reduction in rates
that would use all of the surplus resulting in the City
having to raise the rates again. He said this was not a
good business practice and, if the City Council could be
assured that some of the surplus could be used to reduce
the rates without affecting the City or the Department in
the future, he would agreed to a reduction in rates.
V/M Stelzer said he has disagreed with the former
Director of Utilities/Engineering for several years. He
said he felt that the Utilities Department has been
receiving too much money because of his review of the
rate structures in the previous years.
V/M Stelzer said in 1985, $207,000.00 was received from
the operating income and expenses and $23,000.00 was
eliminated because of the ESM matter which resulted in a
surplus of $1,000,000.00.
Page 2
8/30/88 - Workshop
V/M Stelzer said in 1986, the rates and the income
increased from $4,700,000.00 to $5,900,000.00. He said
the operating income increased from $207,000.00 to
$1,209,000.00.
V/M Stelzer said during 1986 and 1987 the revenue
increased from $5,900,000.00 to $8,135,000.00. He said
the operating income less expenses increased from
$1,209,000.00 to 12,150,000.00.
V/M Stelzer said he informed the previous Director of
Utilities/Engineering, Bill Greenwood, that the surplus
being accumulated was not correct. He said regardless
what questions were asked of Mr. Greenwood, he could not
receive appropriate answers. He said after Mr. Greenwood
resigned, Mr. Foy and Mr. Burroughs analyzed the Accounts
and found that there would be a profit at the end of
Fiscal Year 1987/88.
V/M Stelzer said he felt the figures were over estimated;
however, the Finance Director felt the figures were
correct. He said he would rather consider the figures as
being over estimated and make reductions in certain
areas. He said he would suggest the City use the
recommendations of reducing the water and sewer rates and
leave the Debt Service as it is.
V/M Stelzer said the City Council may not be aware that
the homeowners paid $4.15 for Debt Service and the
Hospital was paying over $1,000.00 per month for the Debt
Service. He said he would like to use one half of a
million dollars of the surplus to handle the capital
improvements ignored in the City for several years. He
10 said if the Finance Director was correct in the figures
and, there would be an additional $500,000.00 in surplus,
it could be used next year for capital improvements.
V/M Stelzer said the current Budget allotted for
$1,000,000.00 for capital improvements and, in the
previous years, capital projects have been included with
the rate structure. He suggested that $250,000.00 be
used for a reduction in the rates for water and sewer.
He said the City was using an increased water pressure
which resulted in more water use than ordinary. He said
Mr. Foy recently reduced the pressure by 15 pounds.
Mr. Foy said when more water was needed, an additional
pump was turned on; however, there were very few
complaints recently regarding the water pressure.
V/M Stelzer said the only complaints the Utilities
Department should be receiving are the higher charges for
the water because of the pressure. He said the residents
using sprinklers had a tremendous spray of water
resulting in more water being used. He said providing
the City and the Utilities Department did not suffer in
the future, the residents would be happy with their rates
being reduced.
C/M Bender said one of the items he has been working on
for several months was the rate structure for water and
sewer. He said he began his study with the City Code to
see what was required by the City. He said Section
27-36.1, Rate and Charges, stated that a review would be
made annually to determine the necessary or advisable
revisions of rates and charges. He said he reviewed the
Department's previous 5 years and he could not find any
data regarding the rate structure; therefore, he
Page 3 /
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8/30/88 - Workshop
investigated why there were no fluctuations in the rates
with the exception of September 16, 1986, when the rates
were increased by 20%. He said he could not find
justification for the rates being increased at that time.
C/M Bender said in previous years there were more charges
and now the City was using the 201 Program and the
wastewater plants have been eliminated. He asked if the
elimination of the wastewater plant should result in a
decrease for sewer rates.
C/M Bender said he was frustrated because he could not
get supporting data regarding these rates. He said he
could not make logical and reasonable conclusions without
further data and explanations.
V/M Stelzer said the City was supposed to set the rate
structure every year by an Engineer; however, the rate
structure used every year was supplied by Mr. Greenwood.
He said the City would have to inquire how the rates were
calculated through Mr. Greenwood.
Mayor Abramowitz said the record should indicate that he
was not an Engineer or Scientist; however, as a
businessman, he was puzzled. He said at this time, he
did not understand certain matters regarding the surplus;
therefore, he would not cast his vote until he received
further information.
Mayor Abramowitz said at the Town Hall Meeting, the City
was unaware that the installation of a second meter for
water cost the resident approximately $1,500.00. He said
the City Council inquired about this matter and found
that cost was too high. He said the Utilities
Department has been a kingdom unto themselves and he will
not determine who, where, what or when but, this excess
surplus should not be allowed to continue. He said he
would like to know why there was a surplus over and above
the City's needs.
Mayor Abramowitz said he understands that the Budget
could not be estimated exactly and, there may never be
enough money to do the capital improvements needed in the
Utilities Department; however, there are other
considerations. He said the City Council had concerns
with the surplus being accumulated this year and he did
not want millions of dollars waiting to be used. He said
he has received several complaints regarding the
tremendous charge in water and sewer rates since he
became Mayor. He said he is shocked that these matters
have been allowed to continue for so many years.
Mayor Abramowitz said he can not blame any specific
person or object because he did not know the reasons. He
said he can see that these matters were held in a very
clenched fist and rightly so. He said he had the utmost
confidence in staff and when he asked a question and
received an answer, he had to assume that the answer was
correct. He said he wanted to receive further
information regarding the actual figures for the rates,
surplus and capital improvements. He said he does not
want the City to continue operating as it has in the past
if it was not appropriate.
Mayor Abramowitz said if he were asked to vote on this
matter, he could not cast his vote because he was not
comfortable with his knowledge on the matter.
Page 4
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8/30/88 - Workshop
C/M Hoffman asked when Mr. Burroughs needed the figures
for the rates to complete the Budget and Mr. Burroughs
said he would like the adjustments far line items in the
Budget submitted no later the evening of September 1,
1988 so there was time to make adjustments for the Public
Hearing scheduled for September 6, 1988.
C/M Hoffman asked what would happen if the adjustments
were not submitted at that time and Mr. Burroughs said
there was nothing precluding the presentation of the
91 Budget as it stands because adjustments could be made
thereafter. Mr. Burroughs said the revenues would be
adjusted accordingly and could be made at the second
Public Hearing; however, he would not appreciate the
Budget being adjusted at the second Public Hearing if
there were several items to be adjusted.
Mr. Burroughs said the City Council could present the
Budget as it stands for the first Public Hearing and make
the final determination at the final Public Hearing.
Mayor Abramowitz asked how this would affect the process
of finalizing the Budget and Mr. Burroughs said the
Utilities Billing Department would have to be informed of
reducing the rates by Resolution.
Mr. Foy said a Rate Resolution would be needed and could
be passed at the end of September, 1988, and the
Utilities Billing Department would be directed to make
the necessary changes.
Mayor Abramowitz said he was more interested with the
City Council being provided with information they need to
make the appropriate decisions.
10 Vickie Beech, Resident, asked if the Debt Service
incorporated more than the Bond Referendum for the 201
Program like the old Bond issue for the purchase and
refinancing of the Sewer Plant.
Mr. Burroughs said it was surprising that such an item
was included in the bills. He said the Debt Service
charge should be included in the availability charges;
however, to his knowledge, the rates for Debt Service are
determined by the amount of principal and interest due on
the 1986 Bond issue which was the 201 Program.
Mr. Foy said the Debt Service charge of $4.15 was
calculated to take care of the 1.2 million dollar Debt
Service on the 1986, Bond which was the sewer Bond only.
C/M Bender asked how the $4.15 Debt Service charge was
determined and Mr. Foy said the charge was determined by
the Bond amount due divided by the number of equivalent
units that were available in the City in 1986/87 then,
divided that amount by 12 which equalled approximately
$4.15.
C/M Bender said there were excesses available at that
time and he asked why the excesses were not deducted from
the charge and Mr. Foy said he did not know if the
excesses were truly available.
C/M Bender said he had evidence that there were excesses
available and Mayor Abramowitz said Mr. Foy was not the
Director and decision maker at that time..
Page 5 i
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8/30/88 - Workshop
C/M Bender said he was only inquiring about this matter
and submitting it to Mr. Foy for investigation.
C/M Bender said the Bond issue charge was figured in 1985
and there have been three years since where the number of
residents has increased. He asked why the charge has not
been recalculated to reduce the Debt Service charge.
Mayor Abramowitz said the City Council can be assured
that the charges would be recalculated in the very near
future. It
Mayor Abramowitz said the City Council seemed interested
in taking the excess surplus and distributing it back to
the residents; however, the method to do so was in
question. He said he was more interested in providing a
decrease that would not fluctuate and he did not want the
decrease to handicap the Department in doing what was
needed to provided services to the City. He asked V/M
Stelzer why he suggested the City pursue A and B of the
recommendations. (SEE ATTACHMENT #1)
V/M Stelzer said the recommendation was to reduce the
water rate from $1.04 to $.89 which would result in a
$250,000.00 reduction for the year and use the remaining
money of $924,000.00 for as many capital improvements as
possible without eliminating the funds. He said he felt
the Finance Director's figures were higher than they
should be; therefore, there should be surplus available
for an adjustment, if needed.
Mayor Abramowitz said capital improvements were already
Budgeted and V/M Stelzer said if the rates were reduced,
the needed capital improvements would have to be
reviewed.
Mayor Abramowitz asked if the Debt Service should be 41
reduced and V/M Stelzer replied, no. V/M Stelzer said
only the rates for water and sewer should be reduced.
C/M Rohr asked if there would be a difference and V/M
Stelzer said the difference would be that the Debt
Service may have to fluctuate from year to year.
V/M Stelzer said Mr. Burroughs indicated that there would
be $924,000.00 available in surplus if the rate reduction
was implemented. He said a portion of the $924,000.00
should be included for capital improvements.
Mayor Abramowitz asked what would happen if the City
decided to use $1,000,000.00 of the surplus to reduce the
rates and V/M Stelzer said he would not approve of this
because there may have been a mistake in estimating.
Mayor Abramowitz said if possible, he would like to
reduce the rates with more than one half of a million
dollars of the surplus.
V/M Stelzer said Mr. Foy indicated that if $1,000,000.00
of the surplus was used to reduce the rates, the rates
would have to be increased by Fiscal Year 1989/90 to make
up for one half of a million dollars and then, do the
same in Fiscal Year 1990/91 for the same reason.
Mayor Abramowitz said since last year, there was
approximately 1.5 million dollars in surplus. He said if
the surplus was used as a cushion and a rate reduction of
$1,000,000.00 was implicated, one should wash the other.
Page 6
8/30/88 -- Workshop
V/M Stelzer said he was not positive that the 1.5 million
dollars was correct. He said he would like to use one
half of a million dollars for the rate reduction in case
the figures were estimated wrong.
Mayor Abramowitz asked if V/M Stelzer felt that the
estimated income was incorrect and V/M Stelzer said he
felt that the estimated income may be wrong. V/M Stelzer
said if the figures were wrong and the City reduced the
rates with $1,000,000.00 of the surplus, there would be
problems in the future.
C/M Hoffman suggested 3/4 of a million dollars from the
surplus be used to reduce the rates and V/M Stelzer said
if this was done, the rates would have to be raised too
soon.
Mayor Abramowitz asked if the rates would have to be
increased if 3/4 of a million dollars from the surplus
was used to reduce the rates and Mr. Foy said the rates
would have to be raised by Fiscal Year 1990/91.
C/M Rohr said there would be no surplus to use in Fiscal
Year 1990/91 if the rates are reduced with 3/4 of a
million dollars of the surplus.
Mayor Abramowitz said if the rates could be reduced to a
safe rate, the surplus would be there; however, not as
much as before the rates were reduced.
C/M Rohr suggested one half of a million dollars from the
surplus be used to reduce the rates for this year and
next year, if there was a big surplus, the rates could be
reduced again. He said if the surplus was used to
ID drastically reduce the rates this year, there may be
problems in the coming years which would cause the rates
to be increased.
Mayor Abramowitz said he would like more information on
this matter and the figures for the future before he made
a decision.
Mr. Burroughs said by his review of the figures, if a
$500,000.00 rate reduction is implemented starting
October 1, 1988, by 1989, there would be $924,000.00 in
surplus. He said if the same rate structure was carried
over to Fiscal Year 1989/90, the surplus would be reduced
to $280,000.00 without an additional rate increase.
Mayor Abramowitz asked what would be done with the
present 1.5 million dollars in surplus and V/M Stelzer
said $500,000.00 would be used for a rate reduction and
the remaining would stay as surplus.
Mayor Abramowitz said if the rates were reduced by
$500,000.00, the income for next year would be reduced,
not the present 1.5 million dollars in surplus.
V/M Stelzer said the surplus would be used for capital
improvements and Mayor Abramowitz said the Budget already
.contained funds for capital improvements.
TAPE 2
Mr. Foy said, using hypothetical numbers, there was
revenue of $10,000,000.00 with expenses of $10,000,000.00
which balance and a surplus of 1.5 million dollars. He
said if one half of a million dollars was taken out of
the revenue by reducing the rates, after so many years,
Page 7
8/30/88 -- Workshop
the rates would have to be raised because the surplus was
being used to accommodate the loss in revenue to pay for
the expenses.
Mayor Abramowitz said the present rate structure and
expenditures created a surplus; however, he did not want
the City to put themselves in a position where money was
needed to pay for the expenses. He said the accumulation
of surplus should not have occurred in such a great
amount and he would be very pleased to have this matter
corrected in a way that all would benefit. It
C/M Bender asked if the expenditures were self-imposed or
State mandated and he asked if there were any
restrictions as to when the expenditures had to be
completed. He said he had concerns with expenditures
that could be completed in 3 years as opposed to one
year.
Mr. Foy said things did not happen to the Utilities
Department overnight and he was not saying that if the
projects were not completed, the services of the
Utilities Department could not continue. He said he has
seen businesses where new owners fire the personnel and
sell off the assets causing the business to expire which
was not going to happen to the Utilities Department as
long as he was the Director.
C/M Bender said he wanted to make sure that the
expenditures anticipated would not place the City in a
bind if accomplished sooner than needed. He said he
would like more information on the expenditures and the
time frame for each one.
Mr. Foy said he was convinced that the projects and
expenditures requested for this year were necessary. He
said he submitted a wish list of projects and 44
expenditures that would have to be done in the future and
the list was long and the costs were large.
C/M Bender asked if the City could get Grants to offset
some of the expenditures and Mr. Foy replied, no. Mr.
Foy said Grants are things of the past and C/M Bender
said the City Council as legislators should worry about
getting Grants.
C/M Bender said he would like an explanation on the
projects, their costs and when and why they needed to be
done.
C/M Hoffman asked how much surplus was accumulated last
year and Mr. Burroughs said the surplus as of October,
1987 was $425,000.00. C/M Hoffman said approximately
$1,000,000.00 was accumulated last year.
C/M Hoffman asked if the City would accumulate
$1,000,000.00 this year if everything remained the same
and Mr. Burroughs said the surplus could have been
generated because the revenues to be received this year
were under estimated. He said the revenues were 17--1/2%
more than anticipated and C/M Hoffman said the revenues
should remain the same if nothing was changed.
C/M Hoffman said if the rates were reduced by
$1,000,000.00, the operations versus the expenditures
should break even leaving enough money to•cover the
capital improvements. He said this would also allow
Page 8
8/30/88 -- Workshop
remaining .funds in the surplus; therefore, the City
Council wanted to reduce the fees to cover the needs and
avoid additional surplus.
Mr. Burroughs said he did not believe that there would be
a recurring surplus because the estimates are higher this
year to cover the
funds being
used for capital
expenditures. He
said the revenues would not be
increasing in the
future.
C/M Hoffman said
the revenues
should remain the same and
Mr. Burroughs said
hopefully.
He said the City should be
able to keep the
present surplus and reduce the rates to
prevent an additional
surplus
next year.
Mr. Foy said this would not be addressing the cost needed
to run the Utilities Department plus the capital
improvements. He said in round numbers, last year the
costs were $9,000,000.00 and this year the costs were
$10,000,000.00. He said if the expenses were maintained
this year as they were last year, capital improvements
and other things could not be accomplished.
C/M Rohr said Mr. Foy was stating that 1 million dollars
for capital improvements was in the coming Budget and it
was anticipated that the next Budget would contain
another million dollars in capital improvements. He said
it is anticipated that each year, there would be 1
million dollars in capital improvements; therefore, if
the rates are reduced, revenues would have to be raised
in a few years.
Mayor Abramowitz asked how much was Budgeted for capital
ID expenditures last year and Mr. Foy said he did not have
the exact information; however, it was approximately
$100,000.00.
Mr. Burroughs said before the City Council reviewed last
year's Budget, he, City Manager Kelly and the previous
Director of Utilities/Engineering had a very difficult
time because expenses had to be cut to balance the
Budget.
Mayor Abramowitz said he would like to avoid Budgeting
for projects that could not be completed because there
was no money available. He said he did not want to
reduce the rates and turn around and raise them 1 to 2
years later or hurt the City by using the money that was
needed for Utility services. He said if he could give
back money to the residents that should not have been
charged, he would be in favor of the refund; however, the
City Council was surprised with the information they have
recently received.
Mayor Abramowitz said the City Council agreed that this
matter should be corrected and he would like to see it
corrected in the most prudent, sensible way.
The City Council AGREED to review this matter further
before coming to a decision.
Mayor Abramowitz said he was not comfortable with the
information; therefore, he suggested the City Council
submit their questions to City Manager Kelly which can be
answered at another meeting.
Page 9
8/30/88 - Workshop
City Manager Kelly said when he became employed with the
City, there was concern about the Utilities Budget which
has been on -going. He said the rates have been an issue
and reviewed in an economical development perspective.
He said his biggest concern was with the water and sewer
rates and, if possible, he would like to see them
reduced. He said he dial not want to see the surplus
money eliminated which was being generated at this time
because the money would be used on the capital projects
that are necessary and have been identified for the
coming years. He said the longer the City waits to
complete the necessary capital improvements, the worse
they will become. He said the City should implement a
conservative reduction that would allow a sufficient
working reserve for capital needs.
C/M Bender said if he had the correct figures, he would
be able to suggest a conservative reduction.
Mayor Abramowitz said he did not want to see this happen;
however, Mr. Burroughs said he would work on the Budget
during the Labor Day weekend if needed. He said he would
like to have his questions answered so he could cast an
intelligent vote.
City Manager Kelly said in regard to looking for Grants,
it was staff's responsibility to get the Grants. He said
City Council could suggest where the Grants could be
obtained; however, they should not involve themselves in
getting the Grants.
At 12:05 P.M., Mayor Abramowitz RECESSED the meeting and
RECONVENED at 12:20 P.M. with ALL PRESENT.
INSURANCE BUDGET
Larry Perretti, Personnel Director, said on August 19,
1983, he submitted new insurance rates that were quoted
by telephone from the Florida League of Cities. He asked
the City Council to disregard the August 19, 1988 rates
because a 3% credit would be applied for this year's
rates. He said quote "A" was showing $1,500,000.00 with
no deductible for 1987/88 and 1988/89 General Liability
and Auto Insurance and the additional cost would be
$110,502.00. (SEE ATTACHMENT #2)
Mr. Perretti said quote "B" was for $1,500,000.00 with a
$10,000.00 deductible, the additional cost would be
$3,307.00.
Mr. Perretti said quote "C" was for $1,000,000.00 with no
deductible, the additional cost would be $69,957.00.
Mr. Ferretti said quote "D" was for $1,000,000.00 with a
$10,000.00 deductible, the additional cost would be
$37,238.00 less than the present cost.
C/M Hoffman asked if the premiums would be reduced by
over $100,000.00 with a $10,000.00 deductible and Mr.
Perretti said these figures were quoted and discussed
over the telephone. C/M Hoffman said this quote was
questionable and Mr. Perretti said on the $10,000.00
deductible there were 5 different types of insurance
using the deductible. He said the insurance was General
Liability, Police Professional, Public Officials,
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8/30/88 - Workshop
Emergency Medical Treatment and Auto Liability;
therefore, if the $10,000.00 was utilized in each of
those areas, $50,000.00 would be added which was a very
substantial savings.
C/M Hoffman said it did not sound right; however, if it
was, he would approve of quote "B".
Mayor Abramowitz said quote "D" indicated a savings of
$40,500.00 per year and VIM Stelzer said there would be
$100,000.00 saved in premium.
Mayor Abramowitz said there was discussion regarding
other Cities going bare and City Manager Kelly said those
Cities discussed had a tremendous cash surplus.
Mr. Perretti said C/M Rohr asked at the previous meeting
for quotes on $25,000.00, $50,000.00 and $100,000.00
deductibles. He said the the only way the Florida
League of Cities would operate was to go with a
$10,000.00 only or a $100,000.00 access where the City
would be responsible for the first $100,000.00. He said
the $100,000.00 access resulted in a tremendous amount of
money because of the additional personnel needed to
handle the insurance.
C/M Hoffman said he was in favor of quote "B" and Mayor
Abramowitz said quote "D" seemed appropriate because of
how the insurance awards were being granted lately.
C/M Hoffman asked Mr. Burroughs what quote he would
select and Mr. Burroughs said he would take quote "D".
Mr. Perretti said in property and liability insurance,
the companies are stating that deductibles were needed in
order to prudently save money.
Mayor Abramowitz asked if there was a possibility to find
another insurance company that offered larger deductibles
and Mr. Perretti said the City would have to go out to
bid. Mr. Perretti said the City did not have the time to
do that this year.
Mr. Perretti said one of the quotes by the Florida League
of Cities could be used this year and the City could go
to bid for next year for a higher deductible.
Mayor Abramowitz asked City Manager Kelly for his opinion
and City Manager Kelly said he would like to compare the
experience of this year.
Mr. Perretti said the City did not have a million dollar
expenditure for this year and Mayor Abramowitz said this
was why he favored a high deductible.
C/M Bender asked how much the experience dictated and Mr.
Perretti said the Florida League of Cities gave him the
loss experience which was 1.48 He said the experience
quoted was for the years of 1984, 1985 and 1986. He said
the study was always 2 years behind; therefore, the
increases came about because of the exposure and the
experience rating.
Mr. Perretti said the City was rated at .963 which was a
3.7 credit for last year and this year the rate was 1.55.
He said with the figures submitted, there was a 37%
increase due to the policies.
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8/30/88 - Workshop
Mayor Abramowitz asked how long ago the City had a large
exposure and Mr. Perretti said when the City was first
created.
C/M Rohr said he was concerned with the City's experience
and would like to receive this information before
determining if the City should take the higher
deductible.
C/M Bender asked how the rating was determined and Mr.
Perretti said he would get this information for the City
Council.
Mayor Abramowitz said based on personal experience, he
would prefer to pay the lower premium with a higher
deductible. He asked how the City Council felt regarding
the quotes.
C/M Hoffman and Mayor Abramowitz said they would choose
quote "D" and C/M Bender said he would choose quote "D"
providing he received the additional information from Mr.
Perretti. V/M Stelzer said he would choose quote "B" if
the $100,000.00 premium was correct on the $10,000.00
deductible. C/M Rohr said he would choose quote "D".
V/M Stelzer asked if the City would be operating without
a Risk Manager. He said he was against doing this and
Mayor Abramowitz said the City Council agreed to the
recommendations of eliminating the position of Risk
Manager.
V/M Stelzer asked if City Manager Kelly would be getting
the position of an Assistant to the City Manager. He
said the City Manager's Budget contained $35,000.00 for
the position.
Mayor Abramowitz said this did not mean the position had
to be filled at this time and V/M Stelzer said if the
position was in the Budget, the City Manager could hire
someone.
Mayor Abramowitz suggested that the City Council call
another Workshop to clear up all of the unanswered
questions.
With no further business, Mayor Abramowitz ADJOURNED this
meeting at 12:35 P.M.
1<2
CAROL A. EVA S, CITY CLERK
"This public document was promulgated at a cost of $126.30 or $3.51 per
copy to inform the general public, public officers and employees of
recent opinions and considerations of the City Council of the City of
Tamarac."
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