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Minutes 06/20/2012 DRAFT MINUTES OF THE COLLIER COUNTY PRODUCTIVITY COMMITTEE Naples, Florida, June 20, 2012 LET IT BE REMEMBERED, the Collier County Productivity Committee in and for the County of Collier, having conducted business herein, met on this 20th day of June, 2012, at 2:00 PM in REGULAR SESSION in Building "F" of the Government Complex, in the County Manager's Conference Room, Naples, Florida with the following members present: Chairman: Steve Harrison Joe Wall James Gibson, Jr. Vlad Ryziw Joseph Swaja Gina Downs (by phone) Excused Absence: Tom Lykos Absent: Cheryl Pavilick, with 3 Vacancies Commissioner Coletta was unable to attend due to his attendance at the Florida Association of Counties (FAC) Conference. ALSO PRESENT: Winona Stone, County Manager's Staff Liaison Pat Lehnhard, Staff Liaison— Clerical Mark Isackson, Director, Corporate Financial Planning & Management Svcs. Connie Murray, Finance Operations Director, Clerk of Courts Office Andrea Marsh, Finance Director, Collier County Sheriffs Office Joanne Markiewicz, Interim Director, Purchasing Department Joyce Fletcher, League of Women Voters Katherine Albers, Government & Transportation Reporter, Naples Daily News Norman Feder Iry Berzon Harold Hall Page 1 Z DRAFT Any persons in need of the verbatim record of the meeting may request a copy of the audio recording from the Collier County Communication and Customer Relations Department. Introduction A. Call to Order—Steve Harrison, Chairman Mr. Harrison called the meeting to order at 2:00 p.m. and a quorum was established. Mr. Harrison advised Gina Downs would be participating in the meeting by phone and would be included in the voting. B. Approval of today's meeting agenda After review of agenda by Mr. Harrison, Vlad Ryziw made a motion to approve the agenda, seconded by Joe Swaja, and approved unanimously. C. Approval of the Productivity Committee Meeting Minutes from 5/16/12. Jim Gibson made a slight change to the minutes. Second page last line, instead of "through email" it should read "as correspondence". Vlad Ryziw made a motion to approve the minutes from May 16, 2012, as amended, seconded by Joe Swaja and carried unanimously. II. Old Business A. Membership Vacancy and Applicants Update Chairman advised that Leslie Prizant had resigned due to additional workload placed on her at her job. We wish her well. This now makes 3 vacancies. Winona stated there had only been one application received and Ian was going to re-advertise. She previously notified Ian to re-advertise for 3 vacancies. B. Quarterly Report on Impact Fee Revenue — Amy Patterson — Continued to next meeting due to technical issues. C. Proposed Projects for 2012 1. Update members on individual conversation with Commissioners — Steve Harrison Steve reported he had met with Commissioner Fiala and Commissioner Coyle, along with County Manager Leo Ochs. He asked for feedback on what projects they would support. Commissioner Fiala agreed to go with the three items she originally supported at the prior BCC Meeting, which were (1) Identifying Alternative Funding Sources for Utilization in 2014; (2) Asset Management; and (3) Review the contract management functions and administrative policies, procedures and practices in place in Purchasing. Page 2 3 DRAFT Commissioner Coyle would like us to focus on anything that would save the County money. Steve has asked for feedback from Commissioner Hiller, but to date, she has not responded. 2. Discussion on possible projects Committee members have reviewed the Ordinance regarding Productivity Committee's responsibilities, and it does not state anywhere that the Committee needs to get approval from the BCC to work on any specific project. Jim Gibson said historically the Committee would not take to the Board in their formal meeting. We always did a courtesy correspondence to BCC and County Manager advising them of projects we were looking at to undertake. 3. Future actions for consideration (possibly including but not limited to: send informational memo to BCC on projects selected, send memo to BCC on projects selected for inclusion in a BCC meeting, no notification to BCC on selected projects) Gina stated she is not willing to work on projects that are not approved by the BCC. It was agreed that an informational memo would be sent to the BCC on projects selected. Steve will prepare a draft and send to Winona for distribution to members. Steve said the Committee has the support of staff on the Purchase-to-Pay project. Vlad Ryziw asked what had changed from the last Committee meeting where a letter listing the projects was going back to the BCC. The majority of the Committee said that's not what was agreed upon. Vlad asked if the BCC told the Committee to come back. Winona said she did not have a transcript of the BCC meeting, but as she recalls the BCC did not approve the work plan, but did not instruct the Committee to report back to the BCC. [Note from Winona on BCC action after the Productivity Committee meeting adjourned: "Reject work plan and continue working on budget review and produce a work plan that falls within their purview. " Motioned by Commissioner Hiller, seconded by Commissioner Fiala, vote 3-2, with Commissioners Coletta and Henning dissenting.] III. New Business A. Update on Taxable Values and Planned Internal Budget Review Activity: 1. Update on ad valorem values being updated by Tax Assessor—Mark Isackson Mark stated that numbers we receive in June are estimates, the Property Appraiser certifies them in July and that is what is used for budget purposes. Numbers received Page 3 • ' DRAFT in June from Property Appraiser, county-wide are up .54%. There is a wide range of disparity in taxable value especially when you go farther into the eastern areas of the county. Still have difficulty rebounding. CRA's are down. Mark is still very cautious of trend going forward. Mark advised that the budget book is on line and if you take a look at the Overview section, it will give you information on what is happening. MSTU's are down. For example, Sabal Palm Road MSTU is down almost 10%, Immokalee Beautification MSTU is down about 9%. Unincorporated area, as a whole, is up .14%. Jim Gibson asked about the City of Naples proper. Mark believes they are up about 2%. Vanderbilt MSTU is down .49%; Pelican Bay is up .92%. In our family of taxing authorities, it's still not consistent enough where we can classify this as we've turned the corner. Again, as we go from 2013 to 2014, Mark hopes the trend holds. At a millage neutral tax rate, we are picking up approximately $411,000 in the General Fund. Remember we are doing this budget to budget, so the July numbers we got last year at budget time, for example in Fund 111, were down. Even though the taxable value is up, the amount of money we're raising is down from the budget last year because the July number last year is higher than the new estimate we got this year, where it's vice versa in the General Fund. We've been able to grow our General Fund Reserves. We'll probably still need to do some mid-year adjustments in 2013, but not as bad as in 2012. Steve asked Mark if he would come back in July to update the committee if there are material changes. Mark said he would, and advised if we do get an increase, he is going to recommend it be put into Reserves. Gina remarked that after she looked at the budget on line, she noted the biggest change is in the CRA's. They are down more than anything else. Mark said that it is an area of concern that is being addressed. At a time when revenue was coming in, the CRA's staffed up for that. Our biggest challenge is on the grant side going forward, managing those grants on the compliance side of it. We are trying to avoid the problems we had on the housing side. We are closely monitoring their activities. Gina said that with the Debt Service being down $12M, she wanted to congratulate staff on a great job. Steve said in past years there have been unencumbered budget items and wanted to know if this was a material amount this year. Mark responded on the capital side there is about $260M. There are several funds involved in that total. Approximately $109,000 of that is new money. Gina said she saw in the paper where the State Legislature is side-swiping some of the Constitutional Officers' budgets. It's still not clear how much will be cut. If the cut happens, how do you keep abreast of that and do you anticipate the county having to fill in that void? Mark said he would let the Sheriff speak to his operations. Mark has had conversations with Crystal about what is going on at the Clerk's side of the house. All Constitutionals submitted their budgets. Our guidelines were pretty severe. If they could play along, they did; and if they couldn't, they explained and justified what they needed from us. Reserves in General Fund are also for the Page 4 DRAFT Constitutional Officers. There may be some surprises that might surface, but Mark has not heard of any at this time. The Committee thanked Mark for attending and giving update. 2. Staff process on further analysis performed on operating budget and how such relates to the Productivity Committee conducting a budget analysis between June and September—No comment made on this item. Jim Gibson asked if he could make a comment about the Naples Daily News article that recently appeared in the paper. He felt the Committee was portrayed in a negative manner as it stated we used it as a stepping stone to run for a higher office. He wanted it made clear to Ms. Albers that several of the members have served 10 years or more on this Committee with no intention of running for a higher office. Ms. Albers said point taken. B. Purchase-to-Pay Project 1. High level overview briefing on current Purchasing Policies, Processes and Practices—Joanne Markiewicz Joanne advised that Purchasing was funded for 17.6 FTEs, although that number would drop to 16.6 in FY 2013. Currently, there are 14.6 FTEs filled in Purchasing. Steve Carnell was Director of Purchasing, but is now Interim Administrator of Public Services Division; and Joanne moved in as Interim Director of Purchasing. An Organizational Chart had been distributed to members. Page 25 of the Committee's packet reviewed statistics, including solicitations, contracts, and protests. Page 26 includes Purchase Order data. Vlad asked if the PO data included change orders, etc. Joanne advised it did, but it also includes Blanket PO's, such as for office supplies. Page 27 shows the Purchase Card data. Joanne advised there are 460 cardholders. The Department Director has discretion on who receives a card within their operating department. Distribution is done through Purchasing after the individual receives training on the purchasing card. Joe Swaja asked what the limits were on these cards. Joanne advised $1,000 per transaction and $10,000 monthly limit and are chargeable to the holder's budget. Vlad asked if there were items that could not be charged on the card. She advised exclusions are cash, personal purchases, gas, meals, and other items identified in the CMA. Steve asked if capital items could be purchased with the card. Joanne said exceptions have been made. Steve asked if a chair could be purchased with the card and charged to Capital if there was money left over. Joanne said no. There are checks and balances both with Purchase Orders and P-Cards. Steve also wanted to know if the program could be expanded, and Joanne advised that it could. Page 5 6 DRAFT Joe Swaja asked what the penalty is for violating use. Joanne advised there is a progressive step program in place. First step is suspension of card for 30 days and retraining. If the operating department does not take action, the Purchasing Department can suspend use of all cards within their department. Page 28 shows invoice data by fiscal year. Paid dollars are inclusive of purchase order payments, credits and direct pays. There are a number of transactions [direct pays] within the county not on purchase orders or P-cards, such as, utilities, employee travel, etc. Vlad asked if there was a consistent format used on contracts for invoicing. Joanne advised they are attached to contracts. Joe asked if there is a target date set for contracts. Master target date is 45 days by Florida Statute; construction 25 days, but they do try for payment within 30 days of receipt of invoice. Question was asked how payments are made. Connie Murray, Clerk's Finance Operations Director, advised they go out electronically. Steve asked if there was any measurement between check cut date and date it goes into the mail. Connie advised checks are cut on Wednesday and go out in the mail Thursday morning. The Clerk's office handles approximately 80,000 transactions annually. Pages 29-51 are high level flow charts of the Purchasing Department's ten (10) large processes. Joanne advised she does not have time allowance on these processes. This may be something the Committee might want to look at. These charts take us through issuance of the Purchase Order. Steve suggested when members look at these charts, there are processes where they require BCC approval on contracts/amendments and are placed on the Board's Agenda. Gina stated, to her knowledge, this is not done in any other county in Florida. Since the flow charts included in the Committee's packets did not copy well in black and white, Winona will send color copies electronically to members. Steve said it is his understanding Purchase Orders are put in SAP. Joanne advised the operating departments put the request into SAP through their fiscal person. Once that occurs, depending on the dollar amount, the request goes into certain departmental work flows. Work flows are set as follows: If$100,000 or less, there is one step of approval; if greater than $100,000, there is a two step approval. If it is a work order or change order on a construction project, there are more layers of approval. All contracts over $50,000 go to the Board for approval. Vlad asked relative to procedures and processes, does the Purchasing Department have a contract management and acquisition management manual? Joanne advised there is one manual for both processes. Many of the procurement specialists take a contract from point of request through bidding to contract management. Page 6 7 DRAFT Connie advised audit is done on all payments. They look at whether they are legal, serve a public purpose and BCC authorized. 2. Specific policy and practice issues to confirm— Steve Harrison On Pages 74-77 of the packet is an e-mail Steve sent to Len Price. Steve stated after talking to Len, he prepared a draft of a hypothetical chart on a $100,000 transaction, which is attached. The Committee reviewed. There are several areas of complexity. Transactions can be anywhere from routine to complex. Joanne advised with the county being involved in so many grants, it is a new complexity and should be looked at as well. A break was taken at this time. Steve is proposing that this project be called "Purchase-to-Pay". We'll look at policies, processes and practices in order to identify opportunities to improve efficiency, economy, effectiveness and controls. We will also consider statutory requirements for auditability. We will look at informal recordkeeping in departments, how things are approved, and multiple signatures depending on what. Also look at communications with vendors either by Purchasing or operating department. We will look at approval of goods receipts and payment of invoices. Vlad recommended they include in memo to BCC the complete scope of this project covering user departments, purchasing department and Clerk's office. Joyce Fletcher from the League of Women Voters commented that going through this process may make Collier County look more business friendly. Gina responded that she doesn't think the Productivity Committee's goal is to make Collier more business friendly. If it does, then great. Joe Swaja thinks it should be included. Making Collier more business friendly is a desirable outcome and the Committee should work toward that. 3. Possible sub-divisions of project—Steve Harrison Gina advised she is not available to do anything on the project until mid July. Steve said project needs to be segmented into three pieces. Joe Swaja suggested looking at major construction contracts first. Joanne will send Winona a copy of list of contracts, which she will send to committee members. Joe Wall and Steve Harrison are going to review the Policy & Procedures before the next meeting. Vlad wants to take a look at the Contract Management and Acquisition Manual. Joanne will send to Winona for distribution. Vlad asked when Len was planning to take the new ordinance to the Board. Ordinance will be going to the BCC on July 24, which is their only meeting in July. Gina stated she has read that other areas in Florida are moving to a regional approach to purchasing. She asked Joanne if they have had any involvement in that. Joanne Page 7 f • DRAFT said they are doing some of that now. We share group of contracts with Lee County and Sarasota. We also do a lot of State contracts. 4. Set initial subcommittee meetings for work plan projects and verify subcommittee members for those projects selected for review Jim Gibson stated he thinks each Productivity Committee member needs to ruminate individually on this. Right now this project looks like a project of magnitude. After all have had a chance to review information submitted, it was agreed by the members to have a meeting July 10 at 10:00 a.m. to discuss going forward with this project. Winona said she will check on conference room availability and will advise members. C. Authorization by the Chairman for Pat Lehnhard, Interim OMB Operations Coordinator, to sign official documents on his behalf The Chairman advised from time to time he is not available to sign letters or memos sent on behalf of the Committee, and in the past, the clerical staff liaison would let him know when something was ready for his signature and he would ask her to sign on his behalf Since there has been a change in the clerical staff, Joe Swaja made a motion that Pat Lehnhard, Interim OMB Operations Coordination, have authorization to sign official documents on behalf of the Chairman; seconded by Vlad Ryziw and unanimously approved. D. Discussion regarding Summer"Break" Joe Swaja made a motion that the Productivity Committee not meet in August; seconded by Gina Downs and unanimously approved. IV. Committee Member/Staff Comments -None V. Public Comment Joyce Fletcher invited all to the League of Women Voters' Forum Monday, June 25 at 5:30 p.m. in the Board Room. There will be 4 members who are running for Constitutional Offices. On Wednesday, June 27, at 5:30 p.m. in the Board Room, the League will be hosting a Forum for Commissioner candidates running in the Primary Election. There will be a moderator for both meetings and questions from the public. Iry Berzon who used to work for the county wanted to let the committee know how impressed he is with the items they undertake. VI. Adjourn — Next regularly scheduled meeting of the Committee is July 18, 2012 at 2:00 p.m., with a special meeting called for July 10, 2012 at 10:00 a.m. Joe Swaja motioned to adjourn the meeting; seconded by Joe Wall; carried unanimously. Page 8 9 DRAFT There being no further business for the good of the County, the meeting was adjourned by Order of the Chair at 5:00 p.m. COLLIER COUNTY PRODUCTIVITY COMMITTEE Chairman, Steve Harrison These Minutes were approved by the Board/Committee on , as presented or as amended Page 9 /b