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Commission Minutes
GREENWOOD
METROPOLITAN DISTRICT
MINUTES OF THE
May 27, 2009
Regular meeting
The regular meeting of the
Greenwood Metropolitan District Commission was held
Wednesday, May 27, 2008 at 3:00 p.m., in the Training Room
of Greenwood Metropolitan District’s Technical Service
Facility, 110 Metro Drive, Greenwood, SC 29646.
In attendance:
Commissioner Bob Haynie,
Chairman Richard
Coleman Paige Holley
Commissioner Byron Smith
Vice Chairman George
Martin Marsha Meyer
Commissioner Gene Hancock,
Secretary Ken
Davis Danny Ware
Commissioner Michael G.
Monaghan
Gayle Grogan Mark Warner
Commissioner Henry
Watts Roy
Hemphill
Commissioner Tim Burke
I.
Chairman Haynie called the meeting to order and gave
the statement of compliance with the notification
provision of the Freedom of
Information Act.
II.
Mr. Martin gave the invocation.
III.
Vehicle Bids
Bidder
Amount Make/Model
Year
Burns Automotive
$26,293 Chevy Silverado 1500 4WD Extend Cab
2009
Vic Bailey (State)
$24,465 Ford
F150
2009
Dick Smith
$30,335 Ford F250
X-21 2009
Ballentine
$27,287 Ford F150
XL 2009
Ballentine
$26,891 Ford
F150
2010
Benson Ford
$26,289 Ford F150
XL 2010
Benson Ford
$28,289 Ford F150 XLT
2010
Staff will review the bids
to assure compliance with the specifications. If the bids
are in compliance, the bid will be awarded to the
responsible low bidder at the next Board Meeting.
IV.
Wilson Creek Upgrade
Mr. Danny Ware of Davis and
Floyd, Inc (D&F) noted the monthly report was emailed to all
Commissioners. The Wilson Creek Trunkline is flowing into
the new influent pump station. The BNR has not started up;
there are issues with one of the drain valves. Commissioner
Monaghan inquired on the severity of the drain valve issue.
Mr. Ware said the issue is not serious from the standpoint
that the basin will need to be drained again to get to the
valve to clean it. He said before the contractor started to
fill the BNR, D&F informed them to make sure all of the
drain valves were cleaned and sealed properly. There is a
leak in the RAS force main. The BNR cannot start until this
leak is repaired. Mr. Ware said on the permit side
everything is ready to go once those items (drain valve and
leak in force main) are resolved. The overall project
schedule seems to be back to the original schedule the
contractor provided. The contractor is almost finished
pouring the new concrete slab for clarifier #4. The
contractor has started to pour the walls for the clarifier.
There are no change orders.
V.
Minutes
Commissioner Watts made a
motion to approve the April 22, 2009 minutes as amended;
Commissioner Smith seconded, and the motion was unanimously
approved.
VI.
Financial Report
Manager Coleman said the
$200,000 that was budgeted for the GASB 45 has not been
expensed. Manager Coleman said GASB 45 is a calculation of
Metro’s ARC. Metro can choose not to fund or to partial
fund it; but no matter how it is funded, in the audit it
will count as an expense and will count against Metro’s bond
coverage. Manager Coleman said the forecast is Metro’s
projection of coverage for the next year and the following
year. As long as Metro has the coverage there is no
problem; GASB 45 is an expense whether it is funded or not
funded. GASB 45 has to be accounted for in the audit for FY
09. Chairman Haynie asked for a definition of “coverage”.
Manager Coleman said coverage is income minus expenses and
that number has to equal to 1.2 times the debt retirement.
Commissioner Monaghan said Metro is above the coverage
amount now. Manager Coleman said currently Metro is above
the number, but they are not projected to be above the
number for FY 10 based on the current situation. Manager
Coleman said the actuarial calculation is for the ARC, is
the amount of money Metro needs to fund for GASB 45 on an
annual basis. Commissioner Burke said there are some policy
issues that will need to be addressed during the budget
workday to get Metro on the right track to where they want
to be. Commissioner Monaghan asked for an update on the
government delay for GASB 45. Manager Coleman said he is
not aware of the government delaying GASB 45. He said it is
written where the company does not have to fund GASB 45.
Commissioner Monaghan said he thought because of the economy
the government gave public agencies a grace period on GASB
45. Chairman Haynie said Metro has the option on whether or
not they want to fund GASB 45. Commissioner Burke wanted to
know when Metro will be required to use the GASB 45
accounting practices. Manager Coleman said Metro has to
account for GASB 45 starting in this fiscal year (FY 09).
He said Metro has budgeted an amount but the amount has not
been expensed. Commissioner Monaghan said the government
and major health providers are trying to reform the
healthcare system. He hates to fund something not knowing
if the healthcare system will change. Commissioner Burke
said the problem is putting the funds in an irrevocable
trust which is based on the GASB 45 guidelines.
Commissioner Monaghan asked if Metro should wait to see what
the proposal will be on the healthcare system. Commissioner
Burke said Metro does not have the need to issue a revenue
bond in FY10. Chairman Haynie suggested for the Commission
and staff to address this issue in more detail during the
budget workday. Commissioner Watts wanted to know how often
the labor expense will be affected by the change of payday.
Manager Coleman said the change of payday should not affect
the remaining two months. Commissioner Watts inquired would
be a saving to pay the employees bi-weekly instead of
weekly. Manager Coleman said Metro might save money on
processing the payroll. Chairman Haynie said when he was
with the County they looked into that and the employees did
not like the change. Commissioner Watts wanted to know who
will own the City Pond sewer lines. Manager Coleman said
Metro will own the lines. Commissioner Watts and Chairman
Haynie asked for more information on the changes to the
property taxes that the County collected (see page 22 of
packet). Mrs. Grogan said it appears that there was a
formula that was incorrect and the County Treasurer’s Office
corrected the error. Commissioner Monaghan said he does not
understand why the figure is so much different than last
year’s figures. Mrs. Grogan said per an email that she
received earlier from the County Treasurer’s Office Metro is
to receive some property tax money in the near future.
Commissioner Monaghan wants a definite answer on why there
is a difference. Mrs. Grogan said she asked that question
each month and has not been given a definite answer. She
will forward the last answer she received to Chairman Haynie
and other Commissioners per Chairman Haynie's request.
Commissioner Monaghan suggested that Metro ask someone above
the County Treasurer. Chairman Haynie inquired if Metro is
still waiting on the fee-in-lieu of taxes. Commissioner
Monaghan asked if Metro knows the amount of tax money they
are suppose to receive. Manager Coleman said Metro gives
the County the amount of money needed for the debt
retirement and the County sets the millage amount.
Commissioner Hancock said he would like a copy of the
formula the County uses. Manager Coleman said Metro should
collect $1,091,408. Commissioner Monaghan asked if Metro
expects to receive more than the $1,091,408. Manager
Coleman said the amount of money Metro asked for is
$1,091,408 and that is the amount Metro expects to receive.
Chairman Haynie said that is the amount the County should
have levied. Commissioner Hancock wanted to know who
receives the money from the assessed taxable property.
Manager Coleman said the money goes into the calculation for
the millage. Commissioner Watts wanted to know the status
of the Bailey Street Repair Project. Mrs. Grogan said that
project is completed. Chairman Haynie inquired if the
project came in 9% under budget. Manager Coleman said Metro
paid 91% of the project bid total. Commissioner Watts asked
if the project still needs to be listed if it is completed.
Mrs. Grogan said she keeps all completed projects on the
list until the end of each fiscal year. Commissioner
Monaghan wanted to know why the sale of the Administrative
Building is under the “Gain/Loss Sale of Investments” rather
than “Other Income”. Mrs. Grogan said Metro had a gain from
the sell and that is where the auditors told her to list
it. Commissioner Monaghan asked if that amount is the
entire $600,000 or the difference. Mrs. Grogan replied the
difference was list in Gain/Loss Sale of Investments.
VII.
Action Items
a.
Budget Workday
The Commissioners will have
a budget workday on Wednesday, June 24th at 8:00
am. Breakfast and lunch will be provided. All department
managers will be available to answer questions regarding
their departments. Commissioners are encouraged to email
their questions in advance. Rates will be discussed during
the budget workday.
b.
Banking Agreement
Chairman Haynie wanted to
know when Metro signed the last agreement. Manager Coleman
said Metro signed the last agreement with the County Bank on
May 10, 2006 and the agreement was for a 5 year period
starting January 2007. Chairman Haynie said Metro signed an
agreement with the County Bank if they (County Bank) agreed
to annex the property at 583 By-Pass 72 NW. Manager Coleman
said that is correct. Chairman Hayne wanted to know why
Metro would be extending the current agreement. Manager
Coleman said the County Bank is building a new building on
Reynolds Ave and they have agreed to annex if Metro would
extend their current agreement with the County Bank.
Commissioner Monaghan said he did not know that County Bank
was asking Metro to agree to another extension. He said CPW
has agreed to extend their (CPW) agreement with County
Bank. Chairman Haynie said he supports annexation but he
does not think Metro has anything to do with the annexation
issue. He does not think Metro should take a position on
whether anyone decides to annex into the City or not because
it does not affect Metro. Chairman Haynie noted this
property is already in the Metro District. Commissioner
Monaghan said the last property The County Bank annexed did
affect Metro. He said this is not the same situation as the
last time; there is already sewer in this area.
Commissioner Smith said by extending this agreement it will
tie Metro to the County Bank longer than the first
agreement. He noted that the Commissioners are satisfied
with how the County Bank is handling Metro’s accounts.
Commissioner Hancock commented that Metro is already banking
with the County Bank now. Manager Coleman said Metro is
still obligated to use County Bank based on the previous
agreement.
Commissioner Smith made a
motion not to extend the current banking agreement with The
County Bank; Commissioner Watts seconded, and the motion was
unanimously approved.
Commissioner Burke suggested
that Metro sends a letter of explanation to the County Bank
stating why Metro did not agree to extend the current
banking agreement.
VIII.
Other/Old Business
a.
Rates
Manager Coleman updated the
Commissioners on the current rate standings. He noted the
top halves of the hand-out (Attachment A) the Commissioners
have seen before which is projecting a 9.9% rate increase
and the critical number is on line 8 draft #2 where the
coverage is 1.20. To get the 1.20 coverage includes a
$400,000 capitalized interest from the revenue bond.
Manager Coleman said Metro is projecting to only receive
$122,000. Based on the updated information under draft #3
the projected rate increase is 16.5%. Commissioner Monaghan
wanted to know what the effect of using more money from the
reserves would have on the rates rather than taking it from
bonds. Manager Coleman said in both cases Metro is taking
the money down to $8 million by the end of July.
Commissioner Monaghan asked if that would affect the
coverage number. Manager Coleman said it would affect it
from the standpoint of Metro not having as much interest
income when Metro takes money out of the reserves. Manager
Coleman said the amount of money in the reserves is not
income. Commissioner Monaghan said but the money is a part
of Metro’s assets. Manager Coleman said that is not a part
of the calculations. The calculation is income minus
expenses. Chairman Haynie said if Metro had a 16.5% rate
increase this year then the next few years the increase
would be 5%. Commissioner Monaghan asked if that includes
an increase on the base rate. Manager Coleman said the
percentage coming in from sewer services will need to be,
depending on how the rates are done, either 9.9%, or 16.5%
higher than the previous year. Commissioner Monaghan said
if Metro does not increase the base rate, then the rate that
Metro publishes is going to be higher than 16.5. Manager
Coleman said he did calculate it on the 9.9% and if Metro
keeps the base rate the same the volumetric rate would
increase 12.5%. Commissioner Monaghan wanted to know what
the affect would be if Metro raises the Capacity Fee.
Manager Coleman said that would have very little effect on
the rates. Commissioner Monaghan wanted to know if Metro
was going to issue any Revenue Bonds next fiscal year.
Manager Coleman replied no, Metro is projecting to issue
Revenue Bonds in FY13. Commissioner Monaghan said it would
not affect Metro since they are not going to issue any
Revenue Bonds. Manager Coleman said it would because Metro
would not have coverage on the current debt. Commissioner
Monaghan wanted to know what would happen. Manager Coleman
said he thinks Metro would be forced to raise the rates to
have the adequate coverage. Commissioner Monaghan wanted to
know who would force Metro. Manager Coleman said the bond
holders would force Metro to have the needed coverage.
Commissioner Monaghan wanted to know what caused this
issue. Manager Coleman said the biggest item was the lower
volumetric sales. Commissioner Monaghan wanted to know if
Metro had enough coverage this fiscal year. Manager Coleman
said the coverage for this year is around 1.7. Commissioner
Monaghan said Metro has more income right now than they had
last year. Manager Coleman said yes, because Metro raised
the rates. Manager Coleman said another way to keep the
percentage down is to have the rate increase earlier in the
fiscal year. Commissioner Monaghan said Metro is only
$100,000 net operating difference than last year. He wanted
to know if the $100,000 made that much of a difference in
the coverage. Manager Coleman said one big difference in
the expenses projected for next year is GASB 45. Chairman
Haynie said the effort increase (rates) but the production
(volume) did not increase. Chairman Haynie said this is
something that will need to be discussed during the budget
process. Manager Coleman suggested having Mr. Daryll Parker
available by conference call. Commissioner Monaghan said
the bottom line is the unemployment rate in Greenwood County
is 13.5%. He thinks it would be a financial hardship on
Metro’s customers to have a 16.5% rate increase.
Commissioner Burke said that is correct; the Commissioners
and staff need to figure out a way to decrease the budget.
b.
LMI Grant Project Information
Mr. Martin said if Metro can
spilt the Seaboard Ave Phase I Project into two projects
they might be eligible for another $500,000grant. Metro
will meet with Mrs. Ruth LaForge Thursday to discuss this
possibility in more detail. Metro will have a pre-bid
meeting on the Seaboard Ave Phase I Project on Wednesday,
June 3rd at 10:00 am at the office. Manager
Coleman said the current project is estimated to cost $1.7
million with Metro receiving a $500,000 grant.
IX.
Miscellaneous Administrative Matters
a.
Report from Partnership
Mr. Mark Warner reported an
announcement for job opening (around 65 jobs) was issued
last week and another announcement should be issued in four
to six weeks for an estimated 450 – 550 jobs from two
different companies. They have been working with Duke
Energy on the site readiness for the City Pond site.
X.
With no further business, the meeting was adjourned.
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