Go Tigers! It is 0-0 as I write this and I am hopeful for a game 2 win!
This week, we had a relatively short meeting. We considered the resolution I mentioned last week setting the health care provider for union employees. The Ingham County Health Care Coalition, who is a coalition of the various employee groups and unions, investigated various plan designs and options for the County’s health care plan for 2013. After finishing it’s review, the Health Care Coalition recommended a small change in the prescription benefit.
The Coalition also reviewed a proposal by the Controller and County Commission that would switch from PHP to Blue Cross Bliue Shield and eliminate the high cost plan, which would save the County $500,000 per year while not costing the employees any money. The proposal would establish a trust funded with $300,000 per year that would offset any employee’s potential increase in out of pocket costs for co-pays and deductibles. The employees that would switch from the high cost to the standard plan would experience substantial savings in premium costs. Additionally, the employee’s out of pocket costs would be capped at an amount equal to their premium savings and the difference between the total out of pocket costs would be paid for out of the trust. The benchmark used to determine the employee’s contribution rate is recommended to increase 2% from the amount used in 2012 in accordance with historical practice.
Unfortunately, the Health Care Coalition rejected this plan and did not authorize the
proposed changes in health care for 2013, so it seems that we will maintain the status quo. The Coalition met once and rejected the proposal, then met again at the request of the county and again rejected the proposal. As such, unless the Coalition position changes, we will authorize Letters of Understanding with all of the collective bargaining units to accept the proposal from Physicians Health Plan of Mid-Michigan. The County will provide the same health insurance benefits to the
Managerial and Confidential Employees effective January 1, 2013.
We next considered compensation for Countywide Elected Officials (excluding judges). I discussed this last week. The resolution proposed to keep the compensation for the countywide officials in 2013 and 2014 the same as it was in 2012. Commissioner Dougan asked to divide out the County Clerk from the rest of the countywide officials. We unanimously approved the compensation for the Sheriff, Register of Deeds, Treasurer, Drain Commissioner, and Prosecutor. In the vote on the Clerk, Dougan complimented current clerk Mike Bryanton, who has served for 18 years and has done an excellent job. Dougan argued that the successor Clerk should not have same salary. He moved to amend to reduce the Clerk's salary by $6,000 to be equal to the Drain Commissioner and Register of Deeds. Commissioner Holman objected saying that this is the compensation for the job regardless of the person there. Commissioner Nolan said that the countywides have are receiving no raises for the next two years and haven't had raises for a while. U argued that the person coming in will have the same duties and responsibilities, and will also need to learn the intricacies of the job so they deserve the same compensation as the existing compensation. The amendment failed 3-11 (the three GOP there voted for it). The final resolution for the Clerk passed 13-1 (dougan voted no).
Finally, we considered the 2013 General Appropriations Resolution (the Budget for the 2013 calendar year). Commissioner Grebner, the Finance Chair, mentioned that there is a good summary of the budget in the budget document (which can be found at www.ingham.org) and that people can review the summary for the details
of the budged. He said the Controller was able to preserve the county's cautious fiscal approach, maintains the reserves by not drawing down at an alarming rate, preserves almost all services expected by the county citizens, keeps long term commitments to employees, cuts costs, does things that cost less and bring in more money, and reforms the pension system. All this done with less money from state, less in interest earnings, reduced property tax values. There were no angry mobs or people asking us to reverse a decision. The budget maintains the progressive innovative workings of Ingham County. No one was treated unfairly, and the pain was equally shared. The resolution passed unanimously.
My campaign for State Representative is now in the home stretch. Twelve more days. I am excited and exhausted and ready for the campaign to be over. I will try to do a preview of the races and give my thoughts on each one, if I have time. If not, please feel free to email me for my thoughts on any of the races. 517-618-1666. Thanks again for everyone's support!
Thursday, October 25, 2012
Saturday, October 20, 2012
Property Assessed Clean Energy, Health Care for County Employees, County-Wide Official Pay
This week, we had a County Services committee meeting. We first considered a resolution that would create a Property Assessed Clean Energy (PACE) district. There was a presentation by Andy Levin of Lean and Green Michigan. He talked about how creation of this program would be a tremendous economic development driver in the county. All funding would be from private sources. Commercial and industrial property owners would save energy and money by making buildings more energy efficient. Buildings more be comfortable and attractive to tenants. It would put county workers to work with the retrofits. It would raise the tax base over time. And there would b no risk to the county. This was created and allowed by PA 270 of 2010, which allows PACE for commercial, industrial, and multi-family property throughout the county (but not residential homes). It allows flexible financing arrangements, and up to 100% financing. No downpayment would be needed, and the whole energy project can be financed. This would be friendly to banks as well because if there was already a mortgage, the bank that holds the mortgage on the property has to give consent. Another benefit is that PACE would help property owners to pay the mortgage because they will have increased property values and taxes, so banks are likely to give consent. All traditional energy efficiency improvements can be financed - lights, windows, HVAC, thermostat, permeable parking lots, and everything that makes a building use less energy and use water more efficiently.
The PACE district can be financed through a special assessment mechanism. This would provide for secure, long-term financing. There are no taxpayer dollars, no Tax Increment Financing, nothing public. Business owner can voluntarily take on a special assessment if they choose. The special assessment would be first in line for payoff should a bankruptcy happen, so it is secure for whoever lends the money. The debt is on the land, not on the person. So if the property is sold, the new property owner has the debt. Typical bank loans are 3-5 years, and when the loan is paid off the company is still in the red. PACE, on the other hand, is a 7-20 years loan. It would be for the useful life of the restoration. Their is a lower, fixed interest rate due to stronger lien position and reduced risk for lender. The contractor that does the work must guarantee the savings, and the contractor must write a check for the difference if it doesn't happen (according to law). Lean and Green has private partners (banks and private funds) that can finance these projects, and there are private funders looking to finance deals. The county votes to get into the program, which is statewide, and can vote to get out at any time. There is no contact and no county dollars encumbered. Additionally, this can satisfy the state revenue sharing requirements in terms of the cooperation component (20% of the dollars that the county receives). On Tuesday, there be a public hearing on the PACE districts, then the resolution can be adopted. This has been used for office buildings, corporate headquarters, data centers, synagogue, funeral homes, etc.
Commissioner Grebner had several excellent questions. He asked if bonds are sheltered from federal taxes. The answer was that bonds are not federally tax advantaged but are state tax advantaged, which makes a difference with state banks. There is no liability for the the county. Questions were also asked about delinquent taxes and was told they are not part of this. The community has the option regarding whether or not to turn over taxes when they are delinquent. The County Treasurer gets to decide.
27 states and the District of Columbia have these. There were also questions about whether this applies to agricultural property, and the answer is that it does apply (except for incinerators and digesters). Additionally, water reclamation projects are included. Wells and reservoirs and other water conservation are going to request this. Farms are eligible. There were also questions about the special assessment. The answer is that it is guaranteed and is handled by the county, which would be a new thing for Ingham County and similar to the drain office. There were many follow up questions about what happens to the property if there are lot splits and the parcel is developed for another purpose. The administration burden can be worked in to the project costs and recaptured by fee on property owner. Also, we are not precluded from any other firm that wants to do this outside of Lean and Green. We can create another district or could replace the existing entities. Others can also work in the district if the county takes action to allow for this. Treasurer Schertzing was asked if this will be a big burden for him, and he responded that it won't be. He said that the county does economic development and this fits into that model.
Finally, questions were asked about how the length of the time frame is set. The answer is that Lean and Green requires an investment grade audit of the energy conservation measures, then approves that the financing is less than the useful life of the equipment. This is based on the weighted average of the equipment. It is up to the parties to decide on the time frame. Some want longer, some don't want long term debt. The County Treasurer gets the final determination, but this is usually driven by market conditions. Commissioner Grebner commented that this is a powerful tool because it is a burden on the land and not the owner, and because it has priority over a mortgage. People with money at stake could use this as a new tool. Commissioner Grebner commented that this can be used for mobile home parks and other water uses, and Lean and Green needs to be ready for all of the activity that would come as part of farmland and other water issues. The resolution now goes to a public hearing on Tuesday then will come back for consideration the week after in committee.
The second big issue that we looked at was the resolution regarding health care options for county employees. We have a health care coalition, which is a coalition of our employee unions that decides on health care options. There were three options on the table at the last health care coalition meeting:
option 1 - status quo
option 2 - move to Blue Cross Blue Shield but retain the high cost plan, which would not create much in savings and would create a new vendor and all the trouble that comes with a new vendor (new rules, new cards that may not be available in time for open enrollment). option 3 - move to BCBS without the high cost plan which would ***
Although the county staff highly recommended the third option, the coalition passed option 1 on an 11-10 vote. It was pointed out, though, that they were split on the provider but did not want to eliminate the high plan. The resolution before us recommended status quo. The Commissioners wanted to move to Blue Cross without the high plan but need the health care coalition to agree as part of collective bargaining in order to create the savings. We amended the resolution to authorize staff to go with the existing option or with the commissioner-preferred option and allow for staff to try to convince the Health Care coalition again that this is the best plan for the county employees and county with the appropriate information. The UAW indicated that they are supportive of the county position. This resolution passed unanimously.
Finally, we dealt with a resolution setting the salary compensation for county-wide elected officials. These are the elected officials that serve the entire county, excluding the judges which are set by the state. The resolution included the same salaries for 2013 and 2014 for the Sheriff, Prosecutor, Treasurer, Clerk, Register of Deeds and Drain Commissioner that they had in 2012. The resolution also requires current these county-wide elected officials to contribute an additional 1.8% of gross wages to employee retirement, increasing the total contribution to 10.26% (which does not apply to county-wides under the new hybrid plan). Commissioner Vickers praised the work that Register of Deeds Hertel has done and was concerned that Hertel will be making less than the new Clerk. All committee members agreed that we should eventually have the Clerk, Drain Commissioner, Register of Deeds, and Treasurer to be equal when there are new people in the offices. With the state of the budget and the cuts we have had to make, though, no one moved to increase the salaries to match. Vickers did move to reduce the county clerk by $6,000, though, but there was no support for the motion.
Sorry for the late posting, but I have been busy lately. But more on that later...17 days until the November 6, 2012 general election!
The PACE district can be financed through a special assessment mechanism. This would provide for secure, long-term financing. There are no taxpayer dollars, no Tax Increment Financing, nothing public. Business owner can voluntarily take on a special assessment if they choose. The special assessment would be first in line for payoff should a bankruptcy happen, so it is secure for whoever lends the money. The debt is on the land, not on the person. So if the property is sold, the new property owner has the debt. Typical bank loans are 3-5 years, and when the loan is paid off the company is still in the red. PACE, on the other hand, is a 7-20 years loan. It would be for the useful life of the restoration. Their is a lower, fixed interest rate due to stronger lien position and reduced risk for lender. The contractor that does the work must guarantee the savings, and the contractor must write a check for the difference if it doesn't happen (according to law). Lean and Green has private partners (banks and private funds) that can finance these projects, and there are private funders looking to finance deals. The county votes to get into the program, which is statewide, and can vote to get out at any time. There is no contact and no county dollars encumbered. Additionally, this can satisfy the state revenue sharing requirements in terms of the cooperation component (20% of the dollars that the county receives). On Tuesday, there be a public hearing on the PACE districts, then the resolution can be adopted. This has been used for office buildings, corporate headquarters, data centers, synagogue, funeral homes, etc.
Commissioner Grebner had several excellent questions. He asked if bonds are sheltered from federal taxes. The answer was that bonds are not federally tax advantaged but are state tax advantaged, which makes a difference with state banks. There is no liability for the the county. Questions were also asked about delinquent taxes and was told they are not part of this. The community has the option regarding whether or not to turn over taxes when they are delinquent. The County Treasurer gets to decide.
27 states and the District of Columbia have these. There were also questions about whether this applies to agricultural property, and the answer is that it does apply (except for incinerators and digesters). Additionally, water reclamation projects are included. Wells and reservoirs and other water conservation are going to request this. Farms are eligible. There were also questions about the special assessment. The answer is that it is guaranteed and is handled by the county, which would be a new thing for Ingham County and similar to the drain office. There were many follow up questions about what happens to the property if there are lot splits and the parcel is developed for another purpose. The administration burden can be worked in to the project costs and recaptured by fee on property owner. Also, we are not precluded from any other firm that wants to do this outside of Lean and Green. We can create another district or could replace the existing entities. Others can also work in the district if the county takes action to allow for this. Treasurer Schertzing was asked if this will be a big burden for him, and he responded that it won't be. He said that the county does economic development and this fits into that model.
Finally, questions were asked about how the length of the time frame is set. The answer is that Lean and Green requires an investment grade audit of the energy conservation measures, then approves that the financing is less than the useful life of the equipment. This is based on the weighted average of the equipment. It is up to the parties to decide on the time frame. Some want longer, some don't want long term debt. The County Treasurer gets the final determination, but this is usually driven by market conditions. Commissioner Grebner commented that this is a powerful tool because it is a burden on the land and not the owner, and because it has priority over a mortgage. People with money at stake could use this as a new tool. Commissioner Grebner commented that this can be used for mobile home parks and other water uses, and Lean and Green needs to be ready for all of the activity that would come as part of farmland and other water issues. The resolution now goes to a public hearing on Tuesday then will come back for consideration the week after in committee.
The second big issue that we looked at was the resolution regarding health care options for county employees. We have a health care coalition, which is a coalition of our employee unions that decides on health care options. There were three options on the table at the last health care coalition meeting:
option 1 - status quo
option 2 - move to Blue Cross Blue Shield but retain the high cost plan, which would not create much in savings and would create a new vendor and all the trouble that comes with a new vendor (new rules, new cards that may not be available in time for open enrollment). option 3 - move to BCBS without the high cost plan which would ***
Although the county staff highly recommended the third option, the coalition passed option 1 on an 11-10 vote. It was pointed out, though, that they were split on the provider but did not want to eliminate the high plan. The resolution before us recommended status quo. The Commissioners wanted to move to Blue Cross without the high plan but need the health care coalition to agree as part of collective bargaining in order to create the savings. We amended the resolution to authorize staff to go with the existing option or with the commissioner-preferred option and allow for staff to try to convince the Health Care coalition again that this is the best plan for the county employees and county with the appropriate information. The UAW indicated that they are supportive of the county position. This resolution passed unanimously.
Finally, we dealt with a resolution setting the salary compensation for county-wide elected officials. These are the elected officials that serve the entire county, excluding the judges which are set by the state. The resolution included the same salaries for 2013 and 2014 for the Sheriff, Prosecutor, Treasurer, Clerk, Register of Deeds and Drain Commissioner that they had in 2012. The resolution also requires current these county-wide elected officials to contribute an additional 1.8% of gross wages to employee retirement, increasing the total contribution to 10.26% (which does not apply to county-wides under the new hybrid plan). Commissioner Vickers praised the work that Register of Deeds Hertel has done and was concerned that Hertel will be making less than the new Clerk. All committee members agreed that we should eventually have the Clerk, Drain Commissioner, Register of Deeds, and Treasurer to be equal when there are new people in the offices. With the state of the budget and the cuts we have had to make, though, no one moved to increase the salaries to match. Vickers did move to reduce the county clerk by $6,000, though, but there was no support for the motion.
Sorry for the late posting, but I have been busy lately. But more on that later...17 days until the November 6, 2012 general election!
Subscribe to:
Posts (Atom)
