MINUTES
ORO VALLEY TOWN COUNCIL
Town Council Special/Study Session
April 9, 2008
ORO VALLEY COUNCIL CHAMBERS
11000 N. LA CANADA DRIVE
 
CALL TO ORDER

ROLL CALL

PRESENT:
Paul Loomis, Mayor
Al Kunisch, Vice Mayor
Paula Abbott, Council Member
K.C. Carter, Council Member
Helen Dankwerth, Council Member
Barry Gillaspie, Council Member
Terry Parish, Council Member

1.

DISCUSSION REGARDING THE RECOMMENDATION TO UPDATE THE COMPENSATION AND CLASSIFICATION POLICIES AND PROCEDURES


Human Resources Director Sandra Abbey reviewed the recommended changes to the Compensation and Classification Policies and Procedures. 

Ms. Abbey then highlighted the following:
~ Compensation Administrative Procedure
 - Establishes Town’s compensation philosophy to provide externally competitive and internally equitable compensation for all employees.
 -  Defines compensation terminology.
 -  Provides standardized written procedures for making compensation decisions.
 -  Provides management guidelines for completing approved employee status changes.
 -  Details procedures for posting and selection of competitive promotional opportunities, including career path progression within designated job families.
 -  Outlines written steps for making special or interim assignments.

~ Classification Administrative Procedure
 -  Structured, consistent, quantitative techniques for evaluating and classifying jobs.  
 -  Market salary data determines salary range within classification (external competitive positioning).
 -  Clearly outlines specific approval responsibilities of the Council, Town Manager, Human Resources and Department Directors for implementing the system.
 -  Provides written direction for classifying existing jobs under the new system.
 -  Includes good faith steps to maintain employee salaries during the transition from the current market-only classification structure to the new internal equity and market position classification bands system.

Ms. Abbey provided a summary of actions to be taken as follows:
~ Bring updated policies to Council for adoption by Resolution.
~ Finalize and implement Administrative Directives upon approval of Town Manager.
~ Begin participative process with employees and supervisors to evaluate jobs and create job families applying internal and external classification factors (before July 1, 2009).

In response to questions from Council, Ms. Abbey explained that:
 ~ The recommended changes were presented to an Employee Focus Group (all employees were invited) in November 2007 and also to the Town’s employee ABOVE group. 
~ Once the Administrative Directives are in place, there will be more employee participation.
~ Special Assignments are currently only used at the Police Department (i.e. multi-jurisdictional assignments, undesirable assignments or dangerous situations, Special Events Coordinator, School Resource Officers).
~ Current system is not broken but there is a lack of documentation of procedures.  These updates would put the procedures in writing and standardize the processes so that there is an understanding of how the procedures are implemented and so that they are not done on an arbitrary basis.
~ The Town Council reviews the pay and the classification of the positions during the Budget process.

Discussion followed regarding:
 ~ Creating career ladders for each position rather than have the Town Manager classify/re-classify positions (addressed in Compensation Procedures Section IV).
 ~ Promotions are not automatic (would depend on the needs of the Department and the Town, employee must meet the minimum requirements of the new position and there must be a promotional opportunity available)
~ Clarify creation of new positions so that there is no ambiguity (creation of upper level positions should come to the Council for final approval).
~ Policy 12 (Compensation) Section 2 - Only remove last sentence of this section.
~ Market adjustments/annual adjustments are approved by the Council.
~ Compensation - Promotions within job family - employee’s salary has to be at minimum of new pay range. 
~ Classification Procedures - Studies would be requested by the individual Department Director if they feel a position should be reclassified. 
~ Provide additional information regarding classification career ladders and paths. 
~ Create a communication plan so that more employees are aware of the recommended changes before the policy changes are presented to Council for final approval (information can be provided at the Oro Valley Public Library and on the Town’s Intranet).

2.

DISCUSSION REGARDING PROPOSED WATER RATES, FEES AND CHARGES


Water Utility Director Philip Saletta introduced members of the Water Utility Commission and thanked them for attending the meeting.

Mr. Saletta then reviewed the proposed water rate increases and highlighted the following:
Financial Considerations:
 - Three funds - Enterprise Fund, Alternative Water Resources Development Impact Fee (AWRDIF) and Potable Water System Development Impact Fee (PWSDIF) funds.
 - Debt service coverage ratio of 1.30.
 - Cash reserves of 5% of Budget.
 - Minimize rate shock.
 - Existing cash reserves.
 - Capital Expenditures.
 - American Water Works Association rate setting principles and methodology.

Financial Analysis:
 - Prepared Water Rates Analysis Report
 - Key assumptions:
   - Growth, reclaimed system, existing and future debt.
   - Tucson Water increase for reclaimed water.
   - CAP water delivery system and operating costs.
   - Phase-in Groundwater Preservation Fee over 5 years.
   - Levelize rate increases in future years.
   - Review by Red Oak Consulting.

Discussion followed regarding the following:
 ~ Tiers 1 - 4 and average water consumption rates
 ~ Higher consumptive users (Proposed rate increase was applied across the board.)
 ~ Conservation measures. Need to take strong proactive measures. 
 ~  Rate structure is geared towards conservation.  The average customer has the opportunity to be in the lowest tier if they conserve. 
 ~ Tucson Electric Power (TEP) rate increase filing and affect on Town’s proposed rate increase.
 ~ Possibly create one more tier in the future and weight higher tiers more so that customers would be more apt to conserve.  Create a structure that rewards conservation.
 ~ Groundwater Preservation Fee - provide information regarding GRF rate increases over the past 4-5 years.

ADJOURNMENT

MOTION: A motion was made by Council Member Parish and seconded by Vice Mayor Kunisch to adjourn the Study Session at 6:40 p.m. 

MOTION carried, 7-0.

SPECIAL SESSION AT OR AFTER 5:30 PM

CALL TO ORDER - 6:41 p.m.

ROLL CALL

PRESENT:
Paul Loomis, Mayor
Al Kunisch, Vice Mayor
Paula Abbott, Council Member
K.C. Carter, Council Member
Helen Dankwerth, Council Member
Barry Gillaspie, Council Member
Terry Parish, Council Member

EXECUTIVE SESSION AT OR AFTER 5:30 PM

MOTION: A motion was made by Vice Mayor Kunisch and seconded by Council Member Parish to go into Executive Session at 6:42 p.m. for the following purpose: Pursuant to ARS 38-431.03(A)(5) discussion or consultation with designated representatives of the Public Safety Employee Group with the Oro Valley Police Department regarding salaries, salary schedules and Memorandum of Understanding (MOU) Agreement

Mayor Loomis announced that in addition to the Town Council, the Town Manager, the Assistant Town Manager, the Town Attorney and the Deputy Town Clerk, Finance Director Stacey Lemos, Police Chief Danny Sharp, Human Resources Director Sandra Abbey and Commander Aaron Lesuer would also be present in the Executive Session.

In response to a question from Council Member Parish regarding going into Executive Session, Town Attorney Tobin Rosen explained that Open Meeting Law provides for these types of situations for negotiations to be discussed in Executive Session at any stage of the proceeding.

Town Manager David Andrews further explained that he requested this item as the Town Manager’s recommended budget is in process.  He stated that he was recommending a 1.5% annual adjustment with up to 4% merit raise due to budgetary constraints.  He further explained that the Town has been in negotiations with the Public Safety Employee Group regarding salaries, etc. and they want 2.5% increase for an annual adjustment.  He stated that the negotiation team has stated that they are at an impasse.

MOTION carried, 4-3 with Council Member Dankwerth, Council Member Gillaspie, and Council Member Parish opposed.

(Council Member Parish left the Executive Session at 7:20 p.m.)

ADJOURNMENT

MOTION: A motion was made by Council Member Carter and seconded by Vice Mayor Kunisch to adjourn the Executive Session at 7:37 p.m.

MOTION carried, 6-0.

MOTION: A motion was made by Council Member Dankwerth and seconded by Council Member Gillaspie to adjourn the Special Session at 7:38 p.m.

MOTION carried, 6-0.