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WHATCOM COUNTY COUNCIL
Finance and Administrative Services Committee
April 20, 1999
The meeting was called to order at 12:00 p.m. by Committee Chair L. Ward Nelson in the
Council Chambers, 311 Grand Avenue, Bellingham, Washington.
Also Present:
Tom Brown
Robert Imhof
Absent:
None
(Clerk's Note: Due to audiotape malfunction, there is no audio recording of this meeting.
Minutes are taken from the clerk's notes.)
COMMITTEE DISCUSSION AND RECOMMENDATIONS TO COUNCIL
1. REQUEST AUTHORIZATION FOR PAYMENT OF COUNCIL MEMBER
TRAVEL/EXPENSES (AB99 -022D)
Nelson stated that Dawson has removed her request.
Imhof moved approval of the request, minus Dawson's request.
Motion carried unanimously.
Nelson stated that the items approved included Hoag's request and Brenner's request.
2. ORDINANCE AMENDING THE WHATCOM COUNTY CHARTER, TO BE
SUBMITTED TO THE PEOPLE, REGARDING THE LEGISLATIVE BRANCH OF
GOVERNMENT (AB99 -090)
Imhof suggested moving this item to the end of the meeting.
The committee concurred.
(Clerk's Note: The following discussion took place after the remaining items were
discussed.)
Finance and Administrative Services, 4/20/99, Page 1
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Imhof proposed that they put on a charter amendment that would increase the Council
pay in the year 2000. In 2001, Nelson, Dawson, Imhof, and Hoag's positions would be narrowed
to two at -large positions. In the year 2003, the second group of Council members would be
elected, and then as of January 1, 2004 the Council would become full time. Everyone would be
able to go through a full cycle. In the meantime, it would give everyone a reasonable return for
the work that is done.
Nelson stated that he would rather see it separated out to two issues, one being a pay
scale increase and the other a full time Council.
Imhof stated that the full -time Council would be paid at 55% of the Executive's salary.
They could separate out the issues: 1. Increase pay of half -time Council members, and 2. Enact
a full -time Council.
Brown stated that there isn't the support to put it on the ballot for a full -time Council. He
couldn't support giving the voters the option of going to a full -time Council without also giving
them the option of an appointed administrator. If this will go forward, it should be next year
when no one is running for election.
Hoag liked the idea of having the change in the number of seats the same time as four of
the Council members' terms expire. If they change to five Council members, then they need to
become full -time, at the same time. Also, anything going forward should be on next year's
ballot. The issue is not the about pay. The issue is trying to provide better government.
Imhof stated that what the Council members are currently paid hardly covers expenses. It
takes away time from families and other jobs. There should be just compensation. Now is the
time.
Nelson asked Imhof to draft his proposal before this evening's meeting.
The committee concurred.
3. DISCUSSION REGARDING CONSTRUCTION OF VESTIBULE AT THE
COURTHOUSE SOUTH ENTRANCE (AB99 -128)
Dave Wareing, Deputy Administrator, stated that there are several options. The problems
on the doors have to do with the impact of the wind. The most recent option is #IA, and the
administration recommends that option #1A be further modified to include doors that open both
to the south and the east. It would take into account eventually putting in metal detectors for
security, although it is not necessary at this point in time.
Brown asked the cost of the new option, #IA. Wareing stated that it would cost $50,000 -
$55,000. It would include doors that are compatible with Americans with Disabilities Act
(ADA) requirements. The current doors would become inner doors.
Finance and Administrative Services, 4/20/99, Page 2
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Imhof moved to recommend approval of option #lA, with the double doors.
Motion carried unanimously.
4. ORDINANCE TO RECLASSIFY THE SOLID WASTE FUND FROM AN
ENTERPRISE FUND TO A SPECIAL REVENUE FUND (AB99 -138)
Eric Schlehuber, Public Works Administrator, stated that the annual financial statements
were reviewed by the State auditor, who advised reclassification due to the nature of the revenue
source.
Imhof stated that it used to be a user fee, now it is an excise tax.
Brown moved to recommend approval.
Motion carried unanimously.
5. DISCUSSION ON THE COUNTY -WIDE GAMBLING TAX (AB99 -148)
Barbara Cory, County Treasurer, stated that the first page of her report shows a history of
the gambling tax. Revenue has been declining. In 1997, there was a change in statute in which
non - profit organizations paid the tax based on net receipts instead of gross receipts. The next
page was an explanation of what is currently collected, both for non - profit and profit
establishments. There was an explanation of a spreadsheet on individual establishments.
Dawson commented that the tribes are involved in a contract for law enforcement.
Wareing stated that the Nooksacks paid for law enforcement for a short time. The Lummi
Casino didn't pay when they were in business because they had their own law enforcement.
Nick Kiniski, Breakers and Reef Tavern, Point Roberts, stated that the net amounts in
Cory's report are misleading, and don't include expenses such as labor costs and overhead. 1/4 of
his tax payment is more than what he makes in a year. He is not much different than other
establishment. They depend heavily on the Canadian dollar. There have been many setbacks in
the business. There are fewer people crossing the border. Jobs have been lost. There has been
growth in the Canadian gambling establishments. There is a lot of competitiveness in the
industry. This tax was to be for the offset of related costs of law enforcement and emergency
services. 50% of the tax must go to law enforcement. The gambling inspectors inspect the
premises. It is too much money to pay for the law enforcement that they receive.
Brown stated that there is a new card room law, which allows leeway for more tables. He
questioned how they are taxed. Cory stated that she was unsure.
Finance and Administrative Services, 4/20/99, Page 3
I Nelson stated that the answer could be to look at net. He questioned whether they take the
2 net off of the immediate sale of the merchandise, or after the other costs are taken out. Cory
3 stated that they are only allowed to deduct the prize amounts, no overhead.
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5 Imhof stated that they have to figure in a realistic overhead.
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7 Nelson stated that Sumas reduced their tax to 1.5% on the gross and Ferndale remained at
8 3 %. Blaine is at 0 %.
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10 Dave Wareing, Deputy Administrator, stated that was correct. It was reduced a few years
11 ago in response to the establishments' request. There has been a great deal of impact due to the
12 Canadian dollar and also the Canadian government. Administration and Council needs to weigh
13 the balance to determine the viability of this tax. He read from a portion of RCW 9.46.
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15 Imhof suggested the Council talk further with the administration and come back in two
16 weeks with a recommendation one way or another.
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18 Allen Warwick, Forest Grove Card Room, stated that reducing the tax will not solve
19 everyone's problem, but will help. The Gambling Commission requires a reporting of the
20 gambling net. That reporting is required throughout the State on the same basis. It may not be
21 possible to manipulate the net to allow deduction of various costs. He currently has 74
22 employees at his card room. The gambling business is labor intensive.
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24 Hank Peltier, Hank's Backhoe Service, Point Roberts, stated that Point Roberts is really
25 depressed at this time. The bar owners are having a hard time. They employ about 70% of the
26 work force in Point Roberts. He requested that the County take a look at this issue, using Point
27 Roberts as an example. The Point Roberts Registered Voters endorse some sort of relief.
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29 Dawson stated that she did not want to postpone this issue. She suggested a reduction
30 from 3% to 1.5 %.
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32 Hoag questioned whether gambling is the biggest business that they do at the restaurants
33 and whether they will go out of business if they do not reduce the tax. Kiniski stated that it is the
34 biggest money- maker. There is no money in food. They try to stimulate prices by lowering the
35 cost of the food. They are competing against Canada. If he did not have the gambling, he would
36 have to close the business altogether.
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38 Hoag stated that her concern was that they are discussing encouraging gambling. She is
39 not interested in promoting gambling. He said that they are not talking about promoting
40 gambling, but about staying in business.
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42 Nelson stated that they are discussing the issue in context of what is allowed by law. He
43 will not entertain a discussion about ethical points of view.
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45 Jim Trull, Birch Bay Golf and Country Club, stated that the County is in a position to
46 advance tourism in Birch Bay. The businesses should support the County. The gambling is
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entertainment to the customers, but it is a dying business. The 3% tax is a major burden. Other
types of entertainment would enable Birch Bay to expand. He encouraged the County to make
an investment in Birch Bay, and put the gaming tax back to a fair percentage.
Brown stated that all of the businesses should be paying on the same basis, either net or
gross. He moved to recommend that they tax the profit businesses on their net at a rate of 5 %. It
would be about half of what they are currently paying.
Imhof suggested keeping it at the gross at 2 %. It would be a little more than Brown's
motion. Also, that would take effect after the first of the year.
(Clerk's Note: End of tape 1, side A.)
Imhof continued to state that this is already budgeted for this year. The non -profit
organizations are paying 2% of their net.
Hoag stated that lowering the tax encourage gambling.
Wareing stated that there needs to be a clarification about the idea that reducing the tax
will increase the number of gamblers. The administration's interest is in preserving businesses
and jobs.
Nelson questioned whether it makes a difference administratively on collecting the taxes
if there is a difference between net and gross. Cory stated that it would not make any difference
at all. It is no problem to track. When reports are filed, the Treasurer receives a copy of the
financial report that is filed with the Gambling Commission.
Nelson stated that a $100,000 reduction in criminal justice is significant.
Motion to change from taxing on the basis of gross to net, and stay at 3 %, beginning
January 1, 2000 carried unanimously.
Wareing stated that the administration would make that adjustment.
Karen Frakes, Senior Civil Prosecuting Attorney, stated that the Council does need a new
ordinance, but it would not be needed until the year 2000.
COUNCIL "CONSENT AGENDA" ITEM
1. RESOLUTION ESTABLISHING COUNTY ROAD PROJECT NO. 998008/998009
AND THE AWARD OF CONTRACT FOR THE RECONSTRUCTION OF TYEE
DRIVE /APA ROAD AND POINT ROBERTS SHOULDER WIDENING TO FRIBERG
CONSTRUCTION INC. AS THE LOWEST RESPONSIVE BIDDER, IN THE
AMOUNT OF $737,816 (AB99 -149)
Finance and Administrative Services, 4/20/99, Page 5
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Imhof moved to recommend approval.
Motion carried unanimously.
2. REQUEST AUTHORIZATION FOR THE EXECUTIVE TO ENTER INTO AN
AGREEMENT WITH THE DEPARTMENT OF ECOLOGY TO PROVIDE FOR
ADOPT -A -ROAD AND JUVENILE OFFENDER LITTER AND ILLEGAL
DUMPSITE CLEANUP PROGRAMS, IN THE AMOUNT OF $32,000 (AB99 -150)
Brown moved to recommend approval.
Motion carried unanimously.
3. REQUEST AUTHORIZATION FOR THE EXECUTIVE TO ENTER INTO A
CONTRACT BETWEEN THE WHATCOM COUNTY HEALTH AND HUMAN
SERVICES DEPARTMENT AND CCG TECHNOLOGIES, INC. FOR THE
IMPLEMENTATION AND SUPPORT OF THE ACCLAIM SOFTWARE PATIENT
TRACKING AND BILLING SYSTEM, IN THE AMOUNT OF $72,780 (AB99 -151)
Benjamin stated that the amount should be corrected to $96,780. They have needed for a
long -time to get a software system in place to track the clients and increase revenue by properly
billing for services rendered. In the past, they had to write off uncollectable bills.
Nelson asked if they can get online adjudication. Benjamin stated that is the long -term
goal.
Hoag asked what services are being received for the $2,000. Benjamin stated that they
get support on the software system to ensure maintenance and proper running. Also, they will do
adjustments and modifications to software through the year 2002. The amount also includes
training on the utilization of the billing software, and the data conversion of any existing
software systems.
Brown moved to recommend approval.
Imhof offered a friendly amendment to change the amount to $96,780 because the
numbers were added incorrectly.
Brown accepted the friendly amendment.
Motion carried unanimously.
Finance and Administrative Services, 4/20/99, Page 6
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4. REQUEST AUTHORIZATION FOR THE EXECUTIVE TO APPROVE THE
PURCHASE OF THREE SPECIAL PURPOSE VEHICLES TO BE USED BY THE
WHATCOM COUNTY SHERIFF'S OFFICE, DESIGNATING THE VENDOR AND
AN AMOUNT NOT TO EXCEED $92,204.57 (AB99 -152)
Deane Sandell, Undersheriff, stated that they are replacing the exiting 4X4 vehicles used
for Search and Rescue (SAR), Newhalem, and Baker Lake. The Expedition size is for the
amount of equipment that is needed to respond to SAR incidents. They currently use the
Expedition in the Road Use vehicle. The Explorer is too small.
Nelson asked if it is equivalent to a half ton.
Mary Ewing, Public Works Equipment Rental & Revolve (ER &R) Manager, stated that it
is heavier than a half ton. It is closer to 3/4 ton. It has a V8 engine.
Sandell stated that the vehicles are used for dual purposes. They must haul prisoners in
addition to the equipment.
Brown asked why the Chevy Tahoe wasn't considered. Sandell stated that they looked at
the Tahoe, and they thought they could get a police package Tahoe. They went out to bid for
them, but they later found out that they could only get them in the 2 -wheel model, which also
cost $7,000 more than this proposal.
Imhof moved to recommend approval.
Nelson stated that there is a change in the engine size of the vehicle.
Sandell stated that the change in size is not so much because of the horsepower as it is the
size of the vehicle.
Brown asked if the sales tax specified was per vehicle or on the entire package.
Dave Wareing, Deputy Administrator, stated that is on the entire package. The County's
share of that tax is $66.
Brown moved to recommend purchase from the lowest bidder.
Hoag questioned why they would he get a V8 engine, with the high gas prices, if the
main concern is to haul. Sandell stated that they are still used in the same way as the sedans.
They need that engine to do the job that they do. They require that size in all pursuit vehicles.
Imhof stated that, if they didn't have engines that size, the people that they are chasing
would get away.
Hoag asked if this is the amount requested in the budget. Wareing stated that this comes
from ER &R. All three are replacement vehicles.
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"tar
Imhof accepted the friendly amendment.
Motion carried unanimously.
(Clerk's Note: The committee returned to item #2)
The meeting adjourned at 1:20 p.m.
Jill Nixon, Minutes Transcription
ATTEST:
Dana Brown- Davis, Council Cleric
WHATCOM COUNTY COUNCIL
WHATCOM COUNTY, WASHINGTON
L. Ward Nelson, Committee Chair
Finance and Administrative Services, 4/20/99, Page 8