• City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
  • City of Cambridge Maryland
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muc meeting minutes

April 28th, 2011
 

Municipal Utilities Commission

Minutes

April 28, 2011

The Municipal Utilities Commission met on Thursday, April 28th, 2011 at the Council Chambers, 305 Gay St., Cambridge, Md.  In the absence of the Mayor, Commissioner Rex Marshall convened the meeting at approximately 6:30pm.

 

Present: Rex Marshall - MUC Commissioner

              Andy Pasden - MUC Commissioner

              Norma Alschbach - MUC Commissioner

              Glenn Ford - MUC Commissioner
              Steve Williams - MUC Commissioner

              Gary Newcomb - Manager

               Kevin Johnson - Asst. Superintendent

              Greg LeBlanc - DPW Asst. Engineer                 

Expenses

Commissioner Rex Marshall asked for approval of expenses for February and March 2011.

Mr. Newcomb said looking at Ck# 21266 to MD Unemployment Insurance Fund for $2,464.00, the city does not pay unemployment insurance.  We had a gentleman leave to reduce our workforce.  We have to be responsible for a certain percentage of the charges associated with his unemployment.  We will end up paying in the neighborhood of $6500 or so for unemployment benefits.  This is something you do not see very often.  Ck #21267 to Edward Pierce for $5.40 is for an overpayment of an account at transfer.  We normally do not refund amounts on any active accounts. Ck#21306 for $78,311.46 to the City of Cambridge is for retirement expense for MUC employees.  At our previous meeting he mentioned last years expense was $58,161.55, with one less employee and no increase in salaries, you can see the substantial increase to the pension system that the Governor has increased for the MUC to contribute.  It went from .0758% to .108%. It was substantial, which we did not have budgeted.   This amount, we will be over budgeted.

Mr. Pasden questioned Ck#21277 and #21308 to Will Brown's truck repairs.  They are pretty substantial truck repairs. His question is, do we have trucks that need to be replaced?

Mr. Newcomb said basically our trucks are in good shape.  Ck# 21277 was for the annual inspections required for our Dump trucks. Also included in that was repairs to our air compressor. Ck#21308 was repairs to Sylvester's truck and if you add them up, he did not see anything too alarming. The largest repair was the new radiator for the MACK dump truck.  Sylvester's truck was the rotors, and the hubs alone was $500 a piece.

The total expenditures for February are $176,213.83.

Motion to approve expenses for February 2011 was made my Ms. Alschbach, seconded by Mr. Pasden.  Passed.

Expenses for March 2011 were submitted for approval.

Mr. Newcomb said the first pay period of each month we pay health insurance. Ck# 21326 for $17,174.75 includes the health insurance amount of $14,756.00.

This consists of employee insurance for $471.67 and employee with dependent is $1,066.77 per month.  This also pays for 5 retirees.  We are trying to keep health insurance for the city at a minimum.  Ck#21334 to USA Blue Book for $1,787.24 is for an automatic dialer for the Stone Boundary Station. It will monitor pressure, flows and anytime we lose power or pressure would drop, it will do an automatic notification to myself or Sylvester or Police Dept for a 24 hr monitoring when installed.  USA Blue Book is a supplier of wastewater and water products.  It was a budgeted item this year. Ck#21371 to Travers Enterprises for $3,673.88 is for a starter that shorted out and a disconnect at our Washington Street pump station that had to be replaced.

Total Expenses for March was $107,664.85.  All items in March were within budget.

Mr. Marshall questioned ck#21349 to Fleet Services for $2,475.55.

Mr. Newcomb stated this is Exxon and it is for Fuel.  We are taking measures to reduce fuel usage.  We have parked one truck.

Motion to approve expenses for March 2011 was made by Ms. Alschbach, seconded by Mr. Pasden.  Passed.

Minutes

 Motion to approve the minutes of  February 24, 2011 meeting was made by Ms. Alschbach seconded by Mr. Ford.  Passed.

 Budget FY-12

Mr. Newcomb stated the budget changes he has made for the new budget.  The vehicle purchase for $30,000, and the reduction of one employee and we're going to try to make due with our vehicles for one more year, we should not have a problem.  The other item was to incorporate the Ground Storage Tank at the Washington Street pump station  in our maintenance agreement.  At the end of the budget you see a revised proposal from Utility Service for renovation and repairs to the tank.  If it is adopted, we will still be getting other prices.  This is a number we can get it for but at least we have a figure to work with.  It is the only large tank we do not have under maintenance.  He said he is pushing it back until it is absolutely necessary because it is an expensive tank to renovate.

It will have to be draped because of the lead paint issues.  It will be blasted to metal and repainted and so on.  Of all the tanks, the largest we have had to spread out over three years is $58,000. This would be $70,569. spread over four years. With the exception of this tank, we have committed over $65,000 a year for the maintenance of all the other tanks.

With this, we would be looking at over $135,000 of our budget for the next four years for tank maintenance.  Our tanks look good and are well maintained.  The other tanks we are paying for, we could get out at any time.  Once we get thru renovation costs we go to the annual basic fee, there is no long term commitment.  It is his opinion we should not get out of this commitment.   It is something that we could.  If you look at the $70,569 times four is what you are looking at to renovate the tank.  He left everything in the budget expect the deletion of the truck and now the $71,000 which was $11,000 increase but had deleted the $30,000 for the truck.  He had included in the budget, increments for all employees that had good evaluations.  The Mayor called him after a meeting to let him know that there had been some City Council members that had got information which was not correct, questioning why MUC was putting in for any kind of salary increases.  As manager of MUC he is following what the City manual says.  The manual says if an employee does a satisfactory evaluation they are entitled to an increment on the salary schedule the City has.  It is also been clear that if the City does not have funds, then we cannot support raises.  That would be at a different level. He felt at his level, he should submit a budget with raises for his employees and show a revenue source to support it, which he has done.  He said he was surprised at the remarks. 

Mr. Pasden asked if pay increases have to be approved by City Council?

Mr. Newcomb said the code states that the MUC be compensated according to the City Salary schedule. Historically, the City Council have to approve the MUC budget  and over the years, they have approved what the MUC board approved.  It says in the code that the City Council has to approve any rate increase. Again, he doesn't know any time the MUC request a rate increase that the City did not go along with it. 

Mr. LeBlanc says they should ask the other City employees how they feel about not getting raises. 

Mr. Marshall stated, he thought in the past, it was approved at this level and they denied it.   If City Council approves MUC, what would the other City employees say  and would there be friction between departments.

Mr. LeBlanc said they haven't had a raise in three years and there was a load of Police Officers at the Council meeting Monday night stating they will start looking elsewhere for jobs.  You have to keep morale up.

Mr. Newcomb said presently all employees other than sworn officers have to pay 5% into the pension fund.  As of July 1st, it will go up to 7%. Employees will have to pay an additional 2%.  Also next year there are 27 pay periods, so your salary will be divided by 27 instead of 26 periods.  It looks like the employees will be hit with a double wammy.

Mr. LeBanc said he thinks health insurance is also going up.

Mr. Newcomb said his opinion stands that if you can show the revenue for it, then we should submit it that way.  He feels all department heads should submit it that way.  If the council denies it, that's what they do.  I don't know if Council realizes there are 27 pay periods coming up.  So basically it looks like your salary is less.

Ms. Alschbach asked if the pension fund is federally insured?

Mr. Newcomb said he is not sure.  This is strictly a State Pension Plan.

Commissioner Williams said it is not.

Sworn Police officers will only go up 1%. They are on the LEOPS program, which is a much better retirement system.

Mr. Williams asked is there no cost of living, just the steps?

Mr. Newcomb said that is correct. There has been times in the past when Council has approved cost of living and increments, but that is rare.  All employees in the City have been at the same step for three years, plus furlough days added on top of it, which decreases it by 4%.

Mr. Pasden said he agrees with the earlier statement, submitting it, showing where it is coming from and let Council make the decision.  You can justify to your employees that you went forward with a raise for them and was turned down at a different level. 

Mr. Newcomb said he was just surprised at the comments made from Council at this time.

Mr. Marshall asked if we had a motion to submit the revised budget as discussed with no rate increases.

Mr. Newcomb said the public is not ready for any kind of increase with the county taxes going up, what is the City going to do?  We already know the increase of the Bay Restoration by $2.50.   Is the City going to increase the disposal fee?  He doesn't live in the City but he feels for the ones that do. It is not a good time to increase any charges to the public.  We should be obligated to help everyone get thru these tough times. We are not jeopardizing the water system or water quality but it is still a bare bones budget.

Mr. Pasden asked if all expenses are paid for the new well?

Mr. Newcomb said they are finishing up as we speak   They installed the pump, all that is left is the electrical.  The subs they were going to use went out of business so they are getting prices from contractors.  It looks like Travers Electric will be doing the electrical, which is who we normally use.  The contract price was $12,500, Travers' prices was $18,000 and is probably why the other company went out of business.  We have roughly $98,000 left and will be paying on that.

Mr. Pasden asked if this would be infringing on next years budget?

Mr. Newcomb said no.  He feels we can pay that without taking additional money out of reserve. Total cost of well will be $319,000.00.   We have only taken approximately $220,000 out of reserves.  We are using operating cost to pay the difference.

Mr. Marshall asked for a motion to approved the revised budget as submitted to the Board.

Ms. Alschbach made a motion to approve, seconded by Mr. Ford.  All in favor. Approved.

Utility Service Communications

Mr. Newcomb said previously, we had discussed contacting Utility Service for possible installation of communication on the Woods Rd tank. It was left that we get comments from Mr. Collison, city attorney and he has a copy of his comments.

His first is to shop around, he felt 70/30 is a little heavy. We have nothing on there.  We have tried and there has not been any real interest from anyone. Mr. Collison said the 10 year provision is too long.

Mr. Marshall asked if we have one on the other tanks?

Mr. Newcomb said we have one on the Fletcher Ave Tank. The revenue on that goes to the City. 

Mr. Marshall asked how long is that one. 

Mr. Newcomb said they just renewed in December.  They are doing some changes on the antennae and that is why we had to get Utility Service involved because we have a maintenance agreement with Utility Service.

Mr. Pasden said this is another example where MUC takes the risk and the City gets the reward.

Mr. Newcomb said he main reason for getting the antennae on the tank was to pay for the maintenance on the tank.  $17,000. That is what he wants to see on the Woods Rd tank.

He stated we will be lucky to find someone to utilize the tank.  Utility Service is nation wide.

Ms. Alschbach said the previous minutes stated you trust them.

Mr. Newcomb said if they are involved, they will make sure things are done correctly and not interfere with our maintenance contract. Mr. Collison's final comment was this was his recommendation.

Mr. Pasden said thank you and we should do what we were going to do.

Mr. Williams said he understands where Mr. Collison is coming from because he has been thru this before.  He agrees that we move forward but blend what Mr. Collison is saying to our benefit not Utility Service.  10 Years is a long lease.

Mr. Newcomb said he feels 10 years, if he talks to Utility Service would not be an issue.  The issue they would have would be number 1, the 70/30 split.  They are adamant if they are going to do all this, that is what they do.

Mr. Williams asked if  we get 30%. 

Mr. Newcomb said no, we get 70% and they get the 30%

Mr. Williams said if they get 30% and do all marketing and oversight from whatever revenue they can get, he agrees, it is not a bad deal.

Mr. Newcomb said they will get the most they can because they are getting 30% of the revenue.

Ms. Alschbach said it would pay for the maintenance.

Mr. Newcomb said it depends on what they can get.

Mr. Williams said he wrote a number of agreements for the county and we should stay more involved.  For example, we may not want too many antennaes on the tank or the citizens may complain that it is an eyesore.

Mr. Marshall asked if anyone had any concerns about the 70/30?

Ms. Alschbach said she agrees with Mr. Newcomb, it is more than we are getting now.

Mr. Williams said it seems fair since they are taking responsibility to do the marketing and protecting us.

Mr. Pasden said there is value in them seeing no damage is done to the tank.

Mr. Newcomb said they inspect anything that goes on the tank so it does not affect the integrity of the tank.

Mr. Pasden said you or someone on your staff would have to do marketing, someone to do the structural reviews and that they are installed properly and at the same time we don't violate the maintenance contract of the tank.  All of that costs money and time.  I agree with Mr. Williams. 

Mr. Williams said he recommends we do a 5 year agreement with renewals of two year increments. This allows everyone to sit back and re look at it again.

Mr. Marshall asked if Mr. Newcomb is going to take this back to Mr. Collison and we agree to keep 70/30 and will change number 2 and 3 and next month we will look at this again.

Mr. Newcomb said he will take this back to Utility Service to make the changes discussed and then let Mr. Collison look at it for our next meeting. It will still be at 70/30 and hope they find someone.

Mr. Marshall asked if we need a motion?

Mr. Newcomb said no, we will still pursue this but will make the necessary changes to accommodate Mr. Collison's suggestions.

Maces Lane Improvements

Mr. Newcomb said previously, Mr. LeBlanc stated the City will be redoing Maces Lane.

At that time Mr. Newcomb stated there are some things we need to do first. We have most of those accomplished. We have replaced some old plastic services, connected some services from the 2" line to 6" line.  The only thing left to do is to cut off the source of the 2" line. This will hopefully eliminate the possibility of having to go into the street after it is surfaced. We found five services that we hadn't previously replaced and transferred over. 

Mr. LeBlanc said  that is great.

Mr. Newcomb said this is something we were able to do and not affect the budget.

Mr. Marshall stated the work that MUC does in house and saving all this money, it is a wonder the City does not reward you in some way.

Mr. Newcomb said over the years we have done a number of improvements. We need a certain amount of people to cover maintenance and repairs. The leaks have come down and this helps free up some time to get other projects done such as this.

The Bypass Rd which has never been completed was a $300,000 job which we did for less than $50,000. Next years budget, shows nothing for installation of new water lines.

He may have to come back and ask for money from reserves for another project.  He did not show it in the budget because it would show us in the hole that much more. We have the funds and he may ask at a later date.

Mr. Pasden asked when Mr. Newcomb presents the budget, do you present narrative as well?  A written narrative?

Mr. Newcomb said yes, but I have not gone to City Council.

Mr. Pasden suggested we talk about successes, talk about employee contributions, about the savings we were able to do using employees without additional cost and how much  is saved, not only for the budget but justification for a salary increase.

Mr. Newcomb said he will most definitely.  Excellent point and he will make sure the employees are aware that the MUC commission recognizes that their work is keeping costs down.

Mr. Pasden said if we don't blow our own horn no one else will. 

Magaothy Well-Station 7

Mr. Newcomb said things are wrapping up as he previously stated. Mr. Travers just received notice to proceed Tuesday.  He has material he has to order and Delmarva Power has to do some things, so it may be a little lag in time getting his part done. 

He is anxious to get it completed.  We will need $94,000 less from reserves that we will not be spending. When I got the change order request of $5900, for things that were omitted , needless to say we did not agree with the change order.  The gentleman he talked to was on the other side of the fence. He told him that MUC expected him to fulfill his obligation to the signed contract.  The next day he received a call from the owner to inform him there would be no additional cost. They want us to be happy with the job.  I basically told him they were trying to get the additional $6,000 that the electrical was costing them. The owner appreciates our business.

Woods Road Tank

Mr. Newcomb said he just wanted everyone to know that with our maintenance contract, they are out there now repainting the exterior of the Woods Road Tank.  They are almost completed.  It looks real good.  The weather has been a real issue with the wind and rain the last few weeks. We do not have to drain the tank when they paint the exterior this time of the year. It is not sweating too bad. This is what we are getting at the base price. If we decide to get out of the maintenance, then wait until the paint job is done.

Superintendent's Report

Mr. Newcomb said if you look at street openings on Leonards Lane, these are services that we switched over to the 12" line that was recently installed due to the construction out to Conifer Village.  We switched the services over and abandoned the old 2" line.

The street openings on Maces Lane is what we previous talked about. 

Mr. Newcomb said there is a section on Glasgow St from Glenburn down to Somerset that we have put a clamp on every joint in there.  It is a cast iron pipe with lead joints.

The new services are both out to Longboat.

Our monthly Pumpage report for February 2011 was 47,112,000 and billed was 41,517,000 with a 12% unaccountable. 

The month of March reported $51,959,000 pumped and 40,522,000 billed, with a 20% unaccountable.  Some of this is due to flushing of the Tech Park line.  That is 10,000 feet of 16" pipe.  This contributes to it.

We have a company, Johnson Control coming in next month at no cost to us and to do a water audit.  They will do an investigation and give us a proposal on trying to reduce unaccountable water.

Mr. Pasden asked if we have a figure on what unaccountable water costs us? Not lost revenue but the actual cost.

Mr. Newcomb said he could put a fiqure to it if you want to basically take our operating cost and divide it by total pumpage and come up with a figure. 

Mr. Newcomb said just today he had a gentleman come in from MDE and working on long term projects necessary for water systems. Mr. Newcomb said he was utilizing the master plan we revised a few years ago and the projects. We got into unaccountable water and we reviewed the numbers and he told him we review the numbers every month and the Commission pays close attention to the unaccountable.  He didn't think that it was too bad.  He has places that are not metered and don't have an accurate way to show how much they are pumping. With us being metered, we have a better feel for it.  The water audit we do, if you throw in a 3 to 4% for meter inaccuracies that will reduce the percentage as well. 

Mr. Pasden stated that the meter inaccuracies should balance out.

Mr. Newcomb said he feels we can't look at individual months, but 3 -6 months.

Mr. Pasden said when Johnson Control comes back with a proposal with money attached to it, we may want to do that type of analysis.  What does it cost us?

Mr. Newcomb said he is anxious to see what they come up with.

Ms. Alschbach asked about the status of the Rt 50 leak.

Mr. Newcomb said we are scheduled  to go in on Tuesday.  He explained where it is and hopefully it will be taken care of.

Mr. Newcomb went over the general ledger.  Acct# 1000 showing  $115,367.10 is the money we collected from credit card and debit accts.  This is our money and this is what he plans on using to pay the balance of the well without going into reserves.

He explained each account and shows what money is ours.   From acct#1090 and down are all reserve accts.

Ms. Alschbach asked if the credit card use has increased.

Mr. Newcomb said yes. Particularly on shut off days, we can get the water back on and the cost of doing business.

He went over sales, showing manufacturing has increased.  Commercial is slightly under.

Residential will pick up during warm weather.  We should be in good shape.

Expenses so far are under budget.  We did have a person resign and have not filled that position, but it will have to be done.  I have not filled it for a number of reasons, one is because we are able to do it. 

We are still under budget for fuel. Overall we are in good shape for maintenance even though we had some bills for repairs.

The Meters looks like we are over, but I will be presenting  a fiqure showing what we sold  which should come away from that fiqure and it looks like it will be close to the budgeted amount.  The Utility pumping stations are doing well.  He briefly went over the other categories. 

The revenues should exceed the budget.

He went over the billed amounts. He also stated that 20% of our customers are paying penalties .  If you took that $60,000 out of our revenue, we would be in trouble.

With no further business, motion to adjourn was made by Mr. Pasden, seconded by Mr. Williams.  Adjourned at approximately 7:30pm

Respectively submitted.

Jane Dorman