Approved Minutes 11/10/2015 Page 66

City of Olmsted Falls Minutes of a Council Caucus Meeting Tuesday, November 10, 2015, at Olmsted Falls City Hall 26100 Bagley Road - Council Chambers, 6:30 p.m.

Council President Kathleen Fenderbosch called the Caucus Meeting to order at 6:35 p.m. Roll call was conducted. Councilmen Jay Linn, Linda Garrity (arrived at 6:40 p.m.), Bob Sculac, Kevin Roberts, Terry Duncan, and Sam Pulice were present.

Also Present: Ann Marie Donegan, Mayor and Gregory Sponseller, Law Director. Audience: 2.

Finance Committee: Chaired by Bob Sculac

a. Ordinance 26-2015 (Mayor’s Compensation Ordinance – Mr. Sculac stated that Mr. Presley put together information regarding four scenario’s. Mr. Presley stated that one scenario includes the same percentage Council received with their increase; mathematically that salary comes to $91,433.00. In 2017 there is an automatic increase in Council salaries which is 2% per annum; he took the ending 2016 salary and increased that by 2% for the salary beginning 01/01/2018 which is $93,262.00.

Mr. Presley stated scenario two includes the consumer price index. He used the U.S. Government price index. In 2002 it was 179.9 and in 2015 it would be 236.95; using that ratio and applying to the 2002 Mayor’s salary the calculated 2015 salary would be $72,219.00 rounded; using the increases from the bargaining units for 2016 and 2017 at the 1.75% and 2% the calculated amount would be $74,952.00 at the end of 2017.

He stated that under scenario three he asked the Clerk of Council to review previous union contracts and he applied the percentages for each of the respective years, except for 2006 as there was a flat dollar amount increase, which he used, he continued applying the percentages through 2017, using base rate increases for a firefighter to increase the Mayor’s salary to $75,803.00, which mirrors increases throughout the previous years.

He also used various city salaries and averaged those out to calculate a salary of $84,118.00. At the end of the day each Council in each city makes the determination he just blended them together. He also presented a comparison of the Olmsted Falls position salaries and with a CEO of an organization you would presume that individual would be paid similar to the top or higher than others. For example, Rocky River is very specific in that the Mayor shall always be the highest paid employee of the city, when they negotiate union bargaining contracts with police and fire, once completed the Mayor is established as the highest paid individual within the city. He is not stated this is right or wrong this is just an example. There are also other cities where the Mayor is not the top paid individual but is competitive with the other directors. Approved Minutes 11/10/2015 Page 67

Ms. Duncan stated that she would personally not consider scenario number one as she does not feel this is a good comparison. She stated that scenario two and three would work in her opinion. She stated that she believes a discussion needs to take place regarding the office and this increase will not take place until after the next election cycle. We need to take into consideration that this increase is for the office and not the individual. This office deserves, at least comparable to what the employees have received over this time period. To take it as high as a comparison with other mayor’s like Mr. Presley indicated every city is different regarding their decision making, which makes it difficult to say for example, Bay Village who has 5,000 more in population and assumes that property tax base and income is also higher. She stated that most of the cities are close to the $75,000 to $80,000 salary range. She believes we are talking about somewhere between $70,000 and $80,000.

Ms. Garrity has previously stated and has always felt that in the past keeping the Mayor’s salary low limited the competition which she does not feel is a good thing. She stated in 2010 Council discussed the Mayor handling the economic development of the city, which this Mayor has begun. Mr. Sculac stated that he believes this was an issue people were concerned over that the Mayor should handle this particular area since we do not have a large administrative staff. Plus, we are looking at today’s world and in the past the Mayor was part-time so anyone could fill the position, including anyone who currently had another job, for example, Dr. Mahoney had his practice and a number of others did the same thing. Today, this is a full time position so this individual does not have another job. He believes that the remuneration has to be such that somebody can either quit their current employment or if the position is held by someone who is retired then it is obviously extra income. In terms of someone leaving an already existing job he thinks we need to offer the kind of salary that would be enticing enough for someone to consider obtaining the office. Mr. Presley stated that if you take the $75,000 mentioned in the minutes and add 1.5% as an annual increase for five years the base would be $75,410. If you take the $75,000 for the same five years at 1.5% increase its $80,796.00. Mr. Sculac stated that personally he is considering the $75,000 range but how we get to that level is another question. He would like to offer two scenario’s for consideration. The first one is, beginning in 2018, which is the first year of a new mayoral term, we phase a salary in based on a $5,000 increase per year over the four year term which would be a total of $20,000. After the end of that term, a 2% increase beginning the third year of the term which is the second half of the term. The second scenario is a $10,000 salary increase in 2018 with another $10,000 in 2020 which would be halfway through the term. Then at that point a 2% starting the second year in 2019. These are his suggestions which would bring us by the end of the next term to roughly the $75,000 level. He would prefer the phase in increase over the four year time frame as opposed to trying to jump into a $20,000 increase tomorrow.

Ms. Fenderbosch stated that Mr. Sculac’s suggestions makes her a little more apt to voting for this increase. Her concern is that we do not know what the next couple of years will bring in terms of revenue. Her next thought was since the increase does not go into effect until the next term would it be better to wait a year and revisit this issue with the new Council but she does like Mr. Sculac’s suggestions. Perhaps there could be something that states if the finances are not available for some reason we would have the ability to halt the increase. Mr. Presley indicated that would be difficult as you have to establish the rate of compensation and it can’t be contingent on another event because you have to know the increases before the term begins and he does not believe that the elections board would allow a salary contingent upon an event. Ms. Fenderbosch stated that she agreed. Mr. Sculac stated that the city negotiates our bargaining unit contracts over a three year Approved Minutes 11/10/2015 Page 68 period and we don’t rescind any of that after the second or third year if we feel we are sliding as those are pretty much carved in stone.

Mr. Sponseller stated that you always try to reopen the contracts if financial conditions change but that is subject to collective bargaining. For the most part all things being equal we are bound by the three year term of the agreement which will expire at the end of 2017. The only legal obligation is that Council has to establish the salary and send the information to the Board of Elections no later than the filing deadline for the election which he believes is August of 2017. Council does have time and one of the advantages in dealing with this now or early next year is it makes the issue less political and the whole point is to avoid politicizing the office. As Ms. Duncan pointed out earlier this is the office not the person we are talking about. Mr. Sculac stated that he believes Council has always been reluctant in the past to raise Council’s salary because it is always kind of an election time. When Council decided to increase the salaries for the next term the consideration was due to the fact that the last Council increase was in 2002 which is 13 years. He also believes that was the last Mayoral increase and since there will be another two years before the increase takes effect that will be a 15 year span between the last increase. He also believes something needs to be done and is ready to make a motion.

Ms. Garrity requested that Mr. Sculac repeat his suggestions, which he did (see above).

Mr. Sculac stated that if Council decides on a specific scenario this evening, or another scenario, he would ask the law director to produce legislation in order to allow for three readings before the end of the year. Mr. Sponseller stated that Council already has legislation before them that can be amended. Mr. Sculac stated that he would prefer three readings with a new piece of legislation which outlines the specifics.

Mr. Sculac stated that with scenario two, beginning in 2018 the salary would be $64,830; in 2019 the salary would be $66,127; in 2020 the salary would be $76,127; and in 2021 the salary would be $77,650.

Mr. Sculac moved to increase the Mayor’s salary as follows: beginning in 2018 the salary would be $64,830; in 2019 the salary would be $66,127; in 2020 the salary would be $76,127; and in 2021 the salary would be $77,650; Ms. Garrity seconded.

Mr. Linn stated that he sees the fire salaries Mr. Presley has referred to and asked if those salaries were for firemen. Mr. Presley replied yes and it is a base firefighter. Mr. Linn asked if these figures were appropriate to use as Council is discussing the Chief Executive of a community. Mr. Presley stated that all he used were the percentage increases. Mr. Linn stated that he would equate the Chief Executive to the Chief of Fire or Police and believes that the Mayor’s position is more intense and time consuming. The law director, police chief, fire chief, police lieutenants, assistant fire chief are higher and does not know how we can use numbers that equate to a five year fireman. The Mayor oversees each department and runs the entire city; in reality probably putting in a lot more hours. He believes it is more appropriate to use those salaries than the average fireman and believes that method three is flawed. Mr. Presley indicated that method three uses the percentages, the fire column is just to show the increases. Mr. Linn stated that he would like to see what the numbers would be if you apply the other salaries to the same scenario. Mr. Presley stated that the other positions are as of today, so if you took those and added the 1.75% for 2016 and 2% for 2017 on the average of those full time positions the salary would easily be in the low $80’s. Mr. Linn Approved Minutes 11/10/2015 Page 69 stated that was his point as the Mayor’s job equates more, in his opinion, to the chief of police, fire chief, assistant fire chief and so on and then what we’ve done in method three is applied just the base fireman to the scenario and he would like to see those increases applied to the Mayor’s position in line with the chief’s positions. He believes that is an appropriate number and would fall somewhere in the middle as he does not consider the Mayor a base fireman. Mr. Presley indicated that he is not comparing that position to a fireman he just used the percentages to figure the Mayor’s salary and skipped so at the end of 2017 the salary would be $75,803. He also agrees with Mr. Linn that the Mayor should be much more competitive with the police and fire chiefs. There are other places where he has seen the mayor in the competitiveness with those positions. Mr. Linn stated that if the salary starts in 2018 than four more years increases need to be included.

Ms. Duncan stated that the Mayor is the CEO of the community however, the fire chief and police chief have gotten to that salary because they have been doing the job for years and years. Future Council’s down the line can vote to increase the Mayor’s salary as CEO. She is very uncomfortable with kicking something higher than that particularly for a position that may only last four years. She is personally more if favor of the $5,000 a year increase rather than $10,000 at the beginning and then $10,000 two years later but she is not comfortable with kicking the mayor’s salary higher than your chiefs. The only reason the finance director is relatively low is because it is a part time position.

Ms. Garrity stated that she is in favor of the $10,000 in 2018 because as if you go review the minutes of 2010 we are pretty close to where we discussed adding the economic development piece. From 2010 to 2015 that position she feels has suffered for five years and that is why she does not have a problem with the $10,000 increase for the first year of the term. She believes what Mr. Linn is trying to say is that from this point until January of 2018 he feels there needs to be an adjustment. Mr. Sponseller indicated that you cannot make adjustments during the term. Mr. Linn stated that all the other increases will not stop today once we this legislation is passed and will continue to rise so this should be adjusted accordingly.

Mr. Sculac stated that he believes the Mayor’s salary needs to be increased but at this point he sees the chief’s as being long term on the job and he does have a problem with that suggestion. He has always been in a position where the boss made more money than everyone else but at this point he has to look at where we are realistically.

Mr. Presley reiterated that with this motion on option two the Mayor’s salary would be set at $64,830 for 2018; $66,127 for 2019; $76, 127 for 2020; and $77,650 beginning 01/01/2021.

Poll: 4 ayes; 3 nays (Linn, Roberts, Pulice). Motion carried.

Mr. Sculac asked for legislation for the Mayor’s salary in order to place it on first reading and be able to run three readings by the end of the year. Mr. Sponseller stated that procedurally he would prepare an amendment by substitution for 36-2015. It will still be on third reading but you may want to simply announce at that time that you will let it run three readings to give the public further opportunity to comment. Mr. Sculac stated that would be transparent if anyone wants to comment to Council members. Approved Minutes 11/10/2015 Page 70

Mr. Sculac asked if the budget would be prepared as Council is meeting next Tuesday. Mr. Presley stated that he has to review the final version with the Mayor and they will be in your packets no later than Friday.

Ms. Duncan stated that regarding insurance Mr. Presley received quotes from other companies and the main company, who is apparently the 2nd largest company came back with a quote that is actually less than what we currently pay by about $6,000. That quote is from Arthur Gallagher in the amount of $61,051 and Jackson Dieken’s was $70,000. Even though the city would change insurers they are a large insurance company with a good track record with cities. Mr. Presley stated that the renewal premium offered by Jackson Dieken is $70,410 with the same comparable plans the Gallagher program is $58,908 which is $11,500 less. The reason he is proposing $61,061 is because he would recommend including a cyber liability premium of $2,185. With all the hacking that is out there we have information, if not for any of the outside residents but for the employees ourselves, that people can potentially hack and get social security numbers and dates of birth. Once hacked we have certain requirements that we have to put in place notifying not only the employee but the federal government and part of this cyber liability would help us meet those requirements of notification. This would also include some of those programs that you see relative to like a life lock offering coverage for the employee or resident whosever information is hacked that the city had that was in fact breached. He would recommend for a small premium of $2,185 for a million dollar coverage cyber liability coverage and it was not included in the proposal from our current carrier. Ms. Duncan stated that as the victim of an office personnel management breach she is well aware that there are huge issues out there and believes we definitely need to add that to our coverage. Mr. Presley stated for full disclosure he would also indicate that he received an additional proposal from USI Pep, the public employees pool insurance program, which did come in even less than what he is proposing but it is not a traditional insurance plan. It is a pooled insurance plan with other townships and municipalities and would be his recommendation that we not accept a pool plan at this point. Additionally, there were two other quotes that come in even higher that were not competitive with the information which were in the $75,000 to $82,000 range and are not up for discussion this evening.

Ms. Garrity stated that the last time we went out for insurance RFP’s for insurance Jackson and Dieken lowered their quote by $10,000 to keep our business. Mr. Presley stated that he has not let anyone make any adjustments to their original proposal. Ms. Garrity stated that she is just seeing if this would be an option to pursue. Mr. Presley indicated that his belief is when you seek proposals from businesses you review them and make sure they match up and you accept the lowest proposal. What would be the reason next year or two years from now for any insurance company to take the time and research the costs to submit a proposal if they know we are just going to negotiate pricing with our current carrier.

Mr. Sculac asked if this was the initial proposal from Gallagher. Mr. Presley replied yes. He has not let any of the firms make any pricing adjustments. He received one quote from each and they are being reported to Council now.

Mr. Roberts asked who the carrier’s were in these respective quotes. Mr. Presley replied Trident would be the carrier under the Gallagher plan and U.S. Specialty under the Jackson Dieken plan; both are very solidly rated. Approved Minutes 11/10/2015 Page 71

Adjournment Mr. Sculac moved to adjourn; Ms. Duncan seconded. Poll: 7 ayes; 0 nays. Motion carried.

The meeting adjourned at 7:20 p.m.

Kathleen Fenderbosch, Council President Angela Mancini, Clerk of Council