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FC030921FINANCE COMMITTEE MEETING March 9, 2021 Elected Officials Participating Virtually Councilmember Vivian Olson Councilmember Diane Buckshnis CALL TO ORDER Staff Participating Virtually Dave Turley, Finance Director Jeff Taraday, City Attorney Phil Williams, Public Works Director Scott Passey, City Clerk The Edmonds City Council virtual online Finance Committee meeting was called to order at 6:00 p.m. by Councilmember Buckshnis. 2. COMMITTEE BUSINESS 1. Resolution adopting Electronic Signatures Policy and Budget Authorization Mr. Passey explained the City is allowed to use electronic signature platforms unless federal or state law requires a wet signature. The primary intent is to use electronic signatures on outside contracts. Electronic signatures must be given the same legal effect as a wet signature. Given changes in the way public agencies are doing business during a worldwide pandemic, use of electronic signatures is very commonplace. To use electronic signatures, an agency must first adopt a local policy. The packet contains a boilerplate policy used by several other cities authorizing an electronic signature platform. He favors DocuSign as they have the most market share among local government agencies. The annual cost is $3200-$5200; he anticipated the City's needs could be met by the lower cost product. He recommended adopting the policy on a future Consent Agenda. The cost will be included in a future budget amendment. Questions and discussion followed regarding DocuSign, effective date of the resolution, the policy as an attachment to the resolution, resolutions are not codified, and the remote notarization policy. Action: Schedule on upcoming Consent Agenda. 2. Job Order Contracting Mr. Williams explained this item is authorization to issue an RFP to develop, implement and administer a job order contracting (JOC) program for the City. Several other cities including Shoreline, Everett, and Tacoma utilize JOCs. JOC was established as a procurement method by the legislature in 2019. Once the City selects a JOC firm, there can be three JOC contractors that specialize in certain areas. He described the JOC process for developing project proposals, explaining it is similar to an ESCO project except the administrator is a private company working on the City's behalf. The original dollar limits established by the legislature have been increased and are expected to be increased against this year (current limits are $500,000 for a single job and $3M for the year). The City likely will not reach those limits as the plan is to start small. The price provided by the JOC is guaranteed and is based on a national database, RSMeans, that has costs by region including the Puget Sound area. JOC would allow work to get started more quickly. He was not aware of any downsides to the program. The purchasing policy was previously updated to allow JOC and a presentation was made to the PPW Committee tonight. The contract for the JOC administrator will come to Council for approval. 03/09/21 Finance Committee Minutes, Page 2 Questions and discussion followed regarding whether in-house staff could coordinate JOCs instead of contracting for a contracting officer, benefits of a JOC overseeing smaller projects, and ability for the City to try JOC and not continue if it doesn't work out. Action: Schedule on upcoming Consent Agenda 3. January 2021 Monthly Financial Report As there was not a lot to talk about for one month Mr. Turley provided background on the 1 % limit on property tax increases, a limit that was enacted 20 years ago. He displayed graphs illustrating the effect the 1 % limit has had on the City's finances: • Graph of property tax growth 2010-2020 - actual collections versus CPI-U o Conclusion: Property tax have grown slower than inflation • Graph of sales and use tax growth 2010-2020 - actual collections versus CPI-U o Conclusion: Sales and use tax have grown faster than inflation • Graph of collections compared to inflation (annual difference and cumulative difference) o Conclusion: Sales tax revenue has made up for the dollars left on the table by the 1 % property tax limit ($3M over 10 years) Mr. Turley highlighted the following in the January 2021 Financial Report: • REET: January budget was $195,000; actual was $625,840 • Sales tax: January budget was $661,963; actual was $774,198 Questions and discussion followed regarding reasons for increased sales tax, facilities maintenance expense in late 2020, the City's investment portfolio, and new buildings with MFTE that do not pay property taxes. Action: Forward to upcoming Consent Agenda 4. PFD Financial Presentation ECA Director of Operations Matt Keller, ECA Board Member and Chair of Admin/Fin Committee Rick Canning, Executive Director Joe Mclalwain, and EPFD Board President Dave Brewster were present. Mr. Keller reviewed the EPFD Income Statement, highlighting 2020 total net surplus of $228,000, sales tax revenue, grants received for capital projects, cost savings in payroll (staff's participation in shared work program cut payroll 30%), and contributions that exceeded budget and the prior year's contributions. Mr. Keller reviewed the 2021 Operating Budget which assumes reduced activity through September. Revisions to the budget are anticipated due to changes in the state's phases, additional fundraising activities, and grants. He reviewed the EPFD/ECA monthly cashflow projection for 2021 highlighting revenue/receipts, expenses/disbursements, non -operating, and potential initiatives to eliminate negative cash position. Questions and discussion followed regarding bond payments, what constitutes other income, EPFD not qualifying for a PPP loan as a municipal entity, potential for a SBA Shuttered Venue Operators Grant, lead time required to book and market quality performances, plans for a spring fundraising event, summer programming, and potential uses of the SBA grant. Action: Information only. Committee requested the EPFD return to the April Finance Committee to discuss refinancing 2012 bonds. 3. ADJOURN The meeting was adjourned at 6:58 p.m.