HomeMy WebLinkAboutFinance August 11 19981
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WHATCOM COUNTY COUNCIL
Finance And Administrative Services Committee
August 11, 1998
The meeting was called to order at 9:30 a.m. by Committee Chair Marlene Dawson in the
Council Committee Room, 311 Grand Avenue
Also Present:
L. Ward Nelson
Connie Hoag
Absent:
None
(Clerk's Note: Due to a technical error, the audio recording of this meeting is inaudible.
Minutes are transcribed from the Clerk's notes.)
COMMITTEE DISCUSSION AND RECOMMENDATIONS TO COUNCIL
1. RESOLUTION CANCELING FLOOD CONTROL FEES ON DEPARTMENT OF
NATURAL RESOURCES TIDELANDS (AB98 -299)
Karen Frakes, Senior Civil Deputy Prosecutor, stated that the question was whether the
statute applies to flood districts. In looking at that issue, she talked with Jeff Monsen, Public
Works Director, and other attorneys. The statute applies. Another issue is that it states the
County can only assess state land if it specially benefited from the improvements. Tidelands
would not be benefited from the types of improvements the district would do.
There was discussion regarding stormwater and the County's request to the state to
collect fees in the future.
Hoag moved to recommend approval.
Motion carried unanimously.
COUNCIL "CONSENT AGENDA" ITEM
1. REQUEST AUTHORIZATION FOR PAYMENT OF COUNCIL MEMBER
EXPENSES AND /OR TRAVEL (AB98 -143F)
Hoag moved to recommend approval.
Motion carried 2 -1 with Nelson opposed.
2. RESOLUTION ESTABLISHING COUNTY ROAD PROJECT NOS. 998004 AND
Finance Committee, 8/11/98, Page 1
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998005, AND REQUEST AUTHORIZATION FOR THE EXECUTIVE TO AWARD
THE CONTRACT FOR THE STRUCTURAL OVERLAY OF BIRCH BAY - LYNDEN
ROAD AND HARBORVIEW ROAD, TO THE LOWEST RESPONSIVE BIDDER,
WILDER CONSTRUCTION COMPANY, IN THE AMOUNT OF $759,842 (AB98-
309)
Nasser Monsour, Public Works Assistant Director, stated that there are ongoing
improvements on Birch Bay road. The project would stop at Lincoln road.
Nelson moved to recommend approval.
Hoag questioned why there was only one bid in the packet. Monsour stated that only the
company recommended by Public Works to receive the bid be enclosed in the packet.
Hoag questioned why there were only two bids. Monsour replied that everyone is busy
during the summer season.
Motion carried unanimously.
Dawson questioned Barbara Cory, Treasurer, about agenda item #1.
Cory stated that a letter must go forward to the state to try and collect future taxes. The
flood control staff should make the request. Dave Wareing, Deputy Administrator, stated that
the letter could also come from the Executive.
Hoag questioned why the administration did not come forward with an answer to the
committee's request for information regarding the statute. Wareing responded that
administration was waiting for information from the Deputy Civil Prosecutor regarding the
history and the statute.
Nelson clarified that the County wants the capability of imposing a fee on Department of
Natural Resources (DNR) tidelands. The County needs permission. It is taxpayers' dollars
either way. Wareing responded that he would rather have the opportunity to spend the tax
dollars in Whatcom County than elsewhere in the state. The administration will write the letter
to DNR.
3. REQUEST AUTHORIZATION FOR THE EXECUTIVE TO AWARD BID #98 -87
FOR THE ANNUAL SUPPLY OF COMMISSARY GOODS FOR THE WHATCOM
COUNTY JAIL TO THE LOWEST RESPONSIVE BIDDER, LEE WHOLESALE
GROCERY, IN THE AMOUNT OF $40,167.24 (AB98 -310)
Nelson moved to recommend approval.
Motion carried unanimously.
Finance Committee, 8/11/98, Page 2
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4. REQUEST AUTHORIZATION FOR THE EXECUTIVE TO AWARD BID #98 -92
FOR THE ANNUAL PURCHASE OF FUEL AND DELIVERY TO THE CENTRAL
SHOP, TO THE LOWEST RESPONSIVE BIDDER, YORKSTON OIL CO. INC., IN
THE AMOUNT OF $123,402.66 (AB98 -311)
Dick Prieve, Public Works Department Maintenance and Operations Assistant Director,
stated that this is the annual bid for fuel. The County has the option to extend the bid award for
four years.
Hoag moved to recommend approval.
Motion carried unanimously.
5. REQUEST AUTHORIZATION FOR THE EXECUTIVE TO ENTER INTO A GRANT
AGREEMENT BETWEEN THE WHATCOM COUNTY PUBLIC WORKS
DEPARTMENT AND THE DEPARTMENT OF ECOLOGY FOR COMMUNITY
LITTER CLEANUP PROGRAM ACTIVITIES IN THE GRANT AMOUNT OF
$30,000 (AB98 -312)
Dawson stated that the activities would be coordinated between the Sheriff and the Public
Works Departments. The corrections crew will be doing the work.
Nelson moved to recommend approval.
Motion carried unanimously.
Nelson questioned Council packet page #55. Nasser Monsour, Public Works Assistant
Director of Administration, stated that Public Works applied for the grant, but the Health
Department would administer it.
Nelson questioned item G on Council packet page #55. Dan Gibson, Senior Civil Deputy
Prosecutor, stated that the language is pursuant to a state Executive Order to maintain control.
The language governs all state contracts that the Executive agencies enter into. Nelson
questioned the scope of the Executive Order. Gibson stated that there are two points to consider:
1. The language is only a request and encouragement, not a requirement, and 2. The language is
applied broadly. Nelson stated that the County goes though the State Environmental Protection
Act (SEPA) review. Gibson responded that the language in effect makes the state people feel
good in that that they've done something good about wetlands. Dave Wareing, Deputy
Administrator, stated that the language is contract "fluff' and the language has no teeth.
6. REQUEST AUTHORIZATION FOR THE EXECUTIVE TO ENTER INTO A
CONTRACT BETWEEN WHATCOM COUNTY AND LARRY E. HALVORSON,
FOR PROFESSIONAL NEGOTIATOR AND LABOR COUNSEL
Finance Committee, 8/11/98, Page 3
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REPRESENTATION IN THE ANNUAL AMOUNT OF $49,836 (AB98 -313)
Nelson moved to recommend approval and commended Halvorson for his work.
Hoag questioned why this service is contracted out. Karen Sterling - Goens, Human
Resources Director, stated that services could be handled in- house, however there is a cost
attached whether they are contracted or handled in- house. Sterling - Goens stated that the
contract represents about 960 hours of legal advice in three years. Human Resources is an
administrative function. The County tries to hire technical negotiators. The County has nine
labor agreements. Another factor was that the County has had wage freezes, which are tough to
negotiate with the unions.
Hoag questioned why the retainer has increased. She is not comfortable with the
increase.
Nelson commented that Halvorson has kept his hourly wage at the same rate. Sterling -
Goens stated that the last contract was very advantageous to the County. He used the previous
time spent on County issues to calculate the new rate.
Hoag questioned the $150 per hour rate. This is in addition to retainer fee.
Hoag moved to amend the retainer fee to $3,000.
Wareing stated that the administration explored this issue a few years ago. They decided
it was not in the best interest of the County to handle the negotiations in- house. All this attorney
does is negotiations regarding human resources issues. He is an expert in the field and the
County is well served. This fee is the amount the attorney will work for. Administration
recommended the full retainer fee.
Wareing further stated that in comparison, Halvorson has provided more assistance at a
lesser cost and is familiar with Whatcom County issues.
Hoag supported contracting the services if the County can't do with current staff.
However, the increase is not justified.
Nelson questioned Hoag's reasoning why the increase is too large. Hoag responded that
it is too much of an increase and he also would receive the extra $150 per hour. Nelson asked
why it is too much of an increase. Hoag responded that the economy in general and Whatcom
County in particular cannot justify the increase. Everyone has stated that the economy will go
down. The state and federal governments are saying everyone should cut costs.
Nelson asked Wareing what the current retainers are for comparable attorneys. Wareing
responded that retainer fees begin from $150 and go up.
Hoag stated that the hourly rate should be higher than the retainer rate. The retainer is
Finance Committee, 8/11/98, Page 4
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designed to save the County money because he is there. Nelson asked Hoag if she believed the
County could get someone else qualified to replace Halvorson if he does not accept Hoag's
recommended retainer. Wareing stated that this fee is a projection of the hours he worked in the
past that were not paid for. The County is trying to establish a fair contractual relationship with
a good attorney that will save the County hundreds of thousands of dollars. He will not over -bill
the County. The $4153 per month represents a fair compensation.
group.
Dawson stated that his job has increased 26% because he is negotiating with a new
Wareing stated that if the economy does get worse, the County will need him even more.
Hoag stated that this estimated fee represents an anomaly because 26% of his time was
spent on one group. Wareing stated that he spent more time on all contracts, this one group was
just an example. This is a fair projection of what his costs are. He is not trying to negotiate an
advantageous position, but trying to be justly compensated.
Dawson stated that it is not good to unilaterally say that the proposal is not appropriate
without researching what alternatives are available.
Nelson asked Wendy Wefer - Clinton, Human Resources Representative, what fees other
jurisdictions are expending. Sterling - Goens responded that typically this is on a billing per hour
basis. Halvorson was not even realizing $100 per hour from the County. He is not trying to pad
his services, the County is just trying to pay market price which is typically $150 - $200 per
hour. Gibson stated that he went through the original interview process with Halvorson. At the
time Halvorson entered into the agreement, he was moving into solo practice and looking for
something stable and he was willing to set the price to guarantee some stability. Now he is
established.
Nelson questioned whether the $150 per hour rate is very competitive. Gibson stated that
it is very competitive.
Dawson restated the amendment to change the retainer to $3000.
Hoag questioned the amount of hours Halvorson has spent on the County. Sterling -
Goens responded that he has spent approximately 960 hours in three years.
Motion to modify the contract failed 1 -2 with Hoag in favor.
Nelson moved to recommend approval.
Motion carried 2 -1 with Hoag opposed.
7. REQUEST AUTHORIZATION FOR THE EXECUTIVE TO ENTER INTO A REAL
ESTATE PURCHASE AND SALE AGREEMENT BETWEEN WHATCOM COUNTY
Finance Committee, 8/11/98, Page 5
I AND THE TOM AND INGEBORG NESSET FOUNDATION FOR THE PURCHASE
2 OF REAL PROPERTY FOR ACQUISITION OF THE NESSET FARM PARK,
3 UTILIZING GRANT MONEY RECEIVED FROM THE WASHINGTON STATE
4 INTERAGENCY COMMITTEE FOR OUTDOOR RECREATION AND
5 CONSERVATION FUTURES FUNDS FOR A TOTAL AMOUNT OF $980,000
6 (AB98 -301A)
7
8 Roger DeSpain, Parks Department Director, stated that the contract is the purchase and
9 sale agreement for the Nesset Farm property. He demonstrated the area on a map. The area is
10 approximately 106 acres. The property has gained another 30 - 40 acres due to an oxbow in the
11 river. Tom Nesset brought the property to the County. Russ Pfeiffer -Hoyt, Executor for the
12 Nesset estate for the last ten years was present for questions. Through an agreement with the
13 Whatcom County Land Trust and the Nesset Foundation, the idea is to sell the property to the
14 County for $980,000. Different appraisals of the timber and the property and structures on the
15 property stated the value is in excess of $1.7 million dollars. From those funds, $200,000 will go
16 into improvements on the property and the remainder the funds would be invested. Gains from
17 the investments go into a fund for Maintenance and Operations (M &O) of the Nesset Farm.
18
19 He has never known of an arrangement such as this. Conservation Futures dollars would
20 be used for M &O which normally can't be done. Because of the arrangements the Nessets have
21 created, the money would be kept in perpetuity to keep the park operating. This property is part
22 of the larger regional park concept.
23
24 Hoag stated that this is a great opportunity. She questioned Council packet page #65
25 regarding the memo to Pete Kremen, County Executive, from DeSpain which referred to two
26 appraisals that were done on the property. One appraisal was done on the land and one on the
27 timber. The summary sheets that were referenced in the memo were not attached. DeSpain
28 provided the summaries. The timber value is $1.2 million and the land and structures are valued
29 at $384,000.
30
31 Hoag questioned the conservation easement restriction to never log and why the timber
32 value was included in the grant. DeSpain responded that state grant processes always look at
33 total value. He wanted to make sure the property owner gets their fair value.
34
35 Hoag questioned the grants. DeSpain stated the County applied for Interagency
36 Committee (IAC) grants and they require appraisals. It is always a good idea to get appraisals so
37 one can say what the value is.
38
39 Hoag asked if the County would not be able to get the $64,000 grant without the
40 appraisal of the timber. DeSpain stated that had to do the appraisal anyway. She questioned
41 why the selling price is so much higher than the value of the structures and property when the
42 timber can't be harvested.
43
44 Pfeiffer -Hoyt stated that the conservation easement does not prohibit but limits logging to
Finance Committee, 8/11/98, Page 6
I preserve old- growth timber. The value is still there. The County can choose to log in the future
2 in a small way. As a park it is not practical, but the value is still there. DeSpain stated that the
3 price of timber is volatile.
4
5 Hoag questioned the reference about personal property on Council packet page #67 and
6 asked who would be liable if the property is owned by the seller and permanently loaned to the
7 County. DeSpain responded that the County has a similar arrangement with Semiahmoo.
8
9 Hoag questioned Council packet page #69, item 3, regarding monies used to support the
10 park. The remainder of the net sale proceeds shall be held by the seller as an endowment fund to
11 be used only at the election of the seller for capital improvements. Because the County is using
12 the proceeds from the investment of the sale for M &O, she would like to see the County have the
13 ability to approve whether the funds are used on the capital improvement expenses..
14
15 Pfeiffer -Hoyt stated that Hoag's suggestion makes sense. It is implied in the agreement,
16 but it would be good to improve the language. This refers to utilizing just the principal
17 endowment funds, which is separate from the interest. The intent as a foundation is to attempt to
18 not reduce the principle, but it exists in case of some major expense.
19
20 Hoag moved to amend the language on Council packet page #69, section 7.4(c)(3) to add
21 "...to the Property, subject to approval of the County."
22
23 Nelson questioned the process of approval and whether the proposal would first go to the
24 seller, and then the County to approve. The County, as the responsible agency that runs the park,
25 usually does capital improvements. The procedure seems backwards. DeSpain stated that
26 improvements would go through the budget process. DeSpain stated determining need for
27 capital improvements would be a partnership.
28
29 Wareing suggested the following language, "...or with such improvements shall be made
30 with the concurrence of the County." Hoag stated she preferred the word "approval" which has
31 a direct impact on tax dollars and it is important to protect their interest.
32
33 Motion carried unanimously.
34
35 Nelson stated that these are tax dollars. He questioned the master plan for the area.
36 There is a concern regarding the restrictions on use. The County does not know if the trust
37 would remain in the current hands. The language states that the Trust could be passed on to
38 another agency agreement. DeSpain stated that the property has been passed on to a foundation.
39 Pfeiffer -Hoyt stated that the intent of the Foundation is to sell the land to the County. The
40 Foundation consists of the Park Department Director, a Park Board member, the Whatcom
41 County Land Trust, and a neighbor of the property. That is the present makeup of the
42 landowner, the Nesset Trust.
43
44 Nelson stated that he was concerned about the transfer of the conservation easement to a
Finance Committee, 8/11/98, Page 7
I qualified organization. He would like the County to have the first right of refusal. Pfeiffer -Hoyt
2 stated that the Whatcom County Land Trust owns the conservation easement. That language is
3 in the conservation easement in the event the Whatcom County Land Trust ceased to exist.
4
5 Nelson can't vote in support until the County taxpayers are protected and the County has
6 right of refusal.
7
8 Wareing stated item A is a separate legal document that is unto itself. The County should
9 have the contract evaluated by an attorney. DeSpain stated that Gibson looked at the contract
10 earlier. Wareing stated that the agreement should be sufficient with a letter of intent, which
11 should be in the purchase and sale agreement.
12
13 Gibson stated that the property is being purchased subject to the conservation easement,
14 which is not under negotiation. It may be assigned to a qualified organization so long as the
15 organization is concerned with ecological and aesthetic considerations consistent with the terms
16 of the conservation agreement as specified in the contract. The Whatcom County Land Trust
17 determines where the passage of the easement may go, consistent with the language in the
18 easement. The County can't negotiation with the assignment. Nelson is looking for a level of
19 assurance from the Whatcom County Land Trust that they won't pass it on to an organization
20 that would be bad. That is hard to guarantee.
21
22 Hoag asked Gibson to suggest language. Gibson stated that the easement is between the
23 Nesset Foundation and the Whatcom County Land Trust and can't be modified except by the
24 Whatcom County Land Trust and the grantors. The Foundation could renegotiate their
25 agreement, but the County would not have control over that negotiation, except insofar as they
26 may want to do that.
27
28 Wareing pointed out that section 8. 1, on Council packet page #69, regarding the use of
29 the property, states that the property must be used as a public park and the facilities must be in
30 compliance with the conservation agreement.
31
32 Nelson stated that the open space laws require public access, but they are not necessarily
33 accessible. There is a broad range of definition of what is public access and public use. He
34 suggested expressing the County's concerns regarding the conservation easement and request the
35 Nesset Foundation alter their conservation easement agreement to address the County's
36 concerns.
37
38 Hoag questioned Gibson on whether the County has the option to sell the property should
39 they determine the County couldn't operate the park under the easement. Gibson stated that to
40 ensure that ability, the County would have to have a ready pot of money for the seller. Hoag
41 stated that the principal would be sitting in the endowment fund.
42
43 Nelson stated that he would rather the County have sole ownership. This does not work
44 well with two people holding the contract, the Foundation and the County. The future of the
Finance Committee, 8/11/98, Page 8
I property could bring undesirable changes.
2
3 Hoag stated that she supported having a conservation easement. The family had a vision
4 for the land and are willing to share with the County and the public, but only under the their
5 terms.
6
7 Wareing stated that there are different agreements. The first agreement is the purchase
8 and sale agreement, the second is the conservation easement, which stands by itself. The County
9 actually owns the property. The easement document would state the easement terms, and the
10 endowment document that would govern the endowment.
11
12 Gibson stated that the property is a bundle of rights. County would own the entire bundle,
13 except the conservation easement, which governs use of the property in regard to various
14 activities. The remainder is held by the Whatcom County Land Trust or its successor, a like
15 organization.
16
17 Wareing stated that the County owns the timber, but is restricted on how the timber can
18 be managed. This is not uncommon for similar agreements.
19
20 Nelson stated that the agreement with Squires Lake was such that if the County decided it
21 is not an appropriate land base, the Whatcom County Land Trust can take it over. He would like
22 similar language in these agreements. The agreement prohibits building any other structures,
23 other than the one interpretive center; logging, except in a management plan; and removal of live
24 vegetation. The terms "negligible and significant" are arbitrary and sometimes subjective. He
25 cited examples in the agreement.
26
27 Hoag moved to recommend approval and then left the meeting.
28
29 Wareing stated that there are two mechanisms for continuing the process. One is the
30 endowment being set up by the Nessets to fund improvements.
31
32 Nelson stated that the question is whether the County wants to enter into agreement with
33 the endowment or purchase the property outright.
34
35 Wareing stated that another alternative is for the Land Trust and Foundation to develop
36 the park themselves and make it available to the County. The County would have use but
37 wouldn't own the property.
38
39 Nelson stated the County should not get locked into one option, especially with the
40 restrictions in the current agreement. Regarding public park use, and this is a sizeable amount of
41 money and land that is at issue, he questioned the purpose of purchasing more land. DeSpain
42 detailed the Master Plan for the area. Nelson stated that the language prohibits creation or
43 improvement of trails other than what already exists. The Whatcom County Land Trust governs
44 how the trails are maintained.
Finance Committee, 8/11/98, Page 9
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Pfeiffer -Hoyt stated that there may be an agreement between the Whatcom County Land
Trust and the County to clarify the intent of the agreements.
Dawson suggested tabling the discussion.
DeSpain stated that when tabling, the Council should remember that there is deadline.
The County may lose the $64,000 grant. There have already been three extensions.
Wareing suggested that the Whatcom County Land Trust, the Nesset Foundation, and
Whatcom County develop an interpretive agreement so the County could approve the purchase
subject to the agreement between all three parties.
Pfeiffer -Hoyt stated that the Whatcom County Land Trust would be agreeable to working
out the interpretive agreement.
Wareing stated that the administration would develop a three -way agreement between the
Whatcom County Land Trust, the Foundation, and the County to interpret intentions.
Dawson moved to approve the agreement subject to the development of an interpretative
agreement.
Motion carried unanimously.
OTHER BUSINESS
Nelson asked Dave Wareing, Deputy Administrator, if the County is prepared for Y2K
(Year 2000 conversion).
Wareing stated that the County would be ready.
Nelson asked for a report at the next Finance meeting in September.
Wareing stated that the administration has been working on the Victim Restoration
Grant. There has been a decision by a group to deny the grant. The state determined it is not
possible to contract out the work. The administration will proceed as originally planned.
ADJOURN
The meeting was adjourned at 10:50 a.m.
Jill Nixon, Minutes Transcription
Finance Committee, 8/11/98, Page 10
2 ATTEST:
3
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7 Dana Brown- Davis, Council Clerk
8
WHATCOM COUNTY COUNCIL
WHATCOM COUNTY, WASHINGTON
Marlene Dawson, Council Member
Finance Committee, 8/11/98, Page 11