2.1 Respnse to Saline County Health Department Proosal CITY OF SALINA
REQUEST FOR CITY COMMISSION ACTION DATE TIME
7/16/13 4:00 P.M.
AGENDA SECTION ORIGINATING DEPARTMENT: FISCAL APPROVAL:
NO:
BY:
ITEM CITY MANAGER'S OFFICE FINAL APPROVAL:
NO:
Page I BY: Jason A. Gage, City Manager BY:
ITEM: Resolution No. 13-7022
Consider a resolution responding both to Saline County's rejection of the City's "Salina-Saline County
Building Proposal" and their respective counterproposal.
BACKGROUND:
The condition of the existing Health Department building has been a major concern both for the City of
Salina and Saline County for over a year. On July 1st, the City submitted to Saline County a proposal
to build a new building on the existing site ("Salina-Saline County Building Proposal") and took an
action providing legal notice to Saline County of dissolution of the current Joint Board of Health. On
July 2"d, Saline County rejected the City's proposal via a news release. On July 9th, Saline County by
letter provided a counterproposal asking the City to fund $500,000 towards the repair of the existing
building and giving up its interest in remaining fund balances that will be available at year-end upon
the final dissolution of the Joint Board of Health.
Attached is a resolution for City Commission consideration that responds to Saline County's
counterproposal. This resolution address the following points as follows:
o The City will agree to provide $500,000 to Saline County for building roof repair and release
Pikul Engineering for design services if Saline County agrees to declare that it has no further
legal claim against the City regarding this matter.
o The City will retain its full interest in the balance of funds remaining upon dissolution of the Joint
Board of Health in accordance with its rights under Section 6 "Termination" of the Joint
Resolution (City Res. No. 04-6312 and County Res. No. 04-1843).
o Absent an agreement for a new building, the City believes that selection of a suitable, existing
building from within the community that can be reconfigured for the Health Department needs is
the next best long-term and most cost-effective alternative.
o The City asks Saline County to consider continuing to work with us to find a suitable
building/site and to remain in a joint health board arrangement for the future; recognizing that
this request is not linked to our agreement to repair the existing roof.
o If the County should choose not to work with the City to find a suitable building/site within the
community, the City expresses its intent to reduce our final mill levy to offset the budget cost
reduction for public health care services, while retaining an amount sufficient to fund animal
control and shelter services.
FISCAL NOTE:
The fiscal impact is $500,000 for the repair of the existing building and amount unknown and not yet
CITY OF SALINA
REQUEST FOR CITY COMMISSION ACTION DATE TIME
7/16/13 4:00 P.M.
AGENDA SECTION ORIGINATING DEPARTMENT: FISCAL APPROVAL:
NO:
BY:
CITY MANAGER'S OFFICE
ITEM FINAL APPROVAL:
NO:
Page 2 BY: Jason A. Gage, City Manager BY:
obligated to for a future building/site.
RECOMMENDED CITY COMMISSION ACTION:
The following options are available for City Commission consideration:
1) Approve Resolution No. 13-7022.
2) Do not approve Resolution No. 13-7022 at this time.
Staff recommends Option #1.
Attachments: Resolution No. 13-7022
Saline County Press Release dated July 2, 2013
Saline County Letter dated July 9, 2013
RESOLUTION NUMBER 13-7022
I
A RESOLUTION RESPONDING TO SALINE COUNTY'S REJECTION OF THE
CITY'S "SALINA-SALINE COUNTY BUILDING PROPOSAL" FOR THE HEALTH
DEPARTMENT AND THEIR SUBSEQUENT COUNTERPROPOSAL.
WHEREAS, by Joint Resolution Number 1576 dated June 28, 1955, the governing bodies of
Saline county, Kansas ("County") and the City of Salina, Kansas ("City") declared their determination
that the public health and sanitation of the county and city would be best promoted by the creation of a
joint board of health and created and established a joint city-county board of health, all in accordance with
K.S.A. 65-205; and
WHEREAS, the City and County are currently parties to a Joint Resolution (City Res. No. 04-
6312, November 22, 2004 and County Res. No. 04-1843, November 16, 204) (the "Joint Resolution") .
reconstituting and restating the organization of the joint city-county board of health("Board"); and
WHEREAS, on July I, 2013, the City provided to the County the "Salina-Saline County
Building Proposal" outlining the City's request to jointly fund a new health department building on the
existing site; and
WHEREAS, on July I, 2013, the City approved Res. No. 13-7019, declaring its intent to
withdraw from the agreement with the County relating to the Joint-Salina-Saline County Board of Health
and the City-County Health Department pursuant to the joint resolution reconstituting and restating the
organization of the joint City-County Board of Health and K.S.A. 65-209; but also expressing an intent to
remain willing to work with the governing body of the County toward "cooperatively" addressing the
public health needs in both the city and the county, potentially by entering into an interlocal cooperation
agreement prior to year-end; and
WHEREAS, on July 2, 2013, the County issued a press release rejecting the City's "Salina-
Saline County Building Proposal" and declaring its intent to repair the existing health department
building; and
WHEREAS, on July 9, 2013 the County submitted by letter to the City its intent once again to
repair the existing health department building in accordance with the "general plans and specifications set
forth . . ." of the "Structural Reinforcement Cost Estimates" report dated May 28, 2013 as provided by
Pikul Engineering to the City and County, requested that the City pay the sum of five-hundred thousand
dollars ($500,000) to the County to be utilized for the repair of the building, that the health department
has already approved the expenditure of$500,000 for the same purpose from the reserve fund, that the
City release its interest in the balance of funds remaining upon dissolution of the health department at
year-end and the County be allowed to retain the full balance of funds, and that the County would have no
further claim against the City regarding the repair of the health department building.
SO NOW THEREFORE, B E IT RESOLVED by the governing body of the City of Salina,
Kansas: .4 YU b
Section 1. e City agrees to pay the sum of five-hundred thousand dollars ($500,000) to the
County to be util' ed for the repair of the health department building and to fully release Pikul
Engineering to pr vide design services to the County for said purposes contingent upon the County
formally releasing from any and all claims relating to the building and terminating the existing building
maintenance agreement between the two parties.
Section 2. The City will retain its full interest in the balance of funds remaining upon dissolution
of the Joint Board of Health in accordance with the provisions of Section 6 "Termination" of the Joint
Resolution (City Res. No. 04-6312, November 22, 2004 and County Res. No. 04-1843, November 16,
it 204)and K.S.A. 65-210. -
Section 3. The City believes that absent agreement with the County for construction of a new
health department building, the joint selection of a suitable, existing building within the community that
can be reconfigured to the functional needs of the health department operation is the next best long-term
and most cost-effective alternative for the betterment of public health services in Saline County.
Section 4. That notwithstanding Section 1 and Section 2, the City re-asserts its willingness to
work with the governing body of the County toward"cooperatively"addressing the public health needs in
both the city and county through an interlocal agreement. In proposing to do this, the City requests that
the County:
A. Work with the City to seek a suitable, existing building within the community that can
reasonably meet the long-term, functional needs of the health department.
B. Utilize the expertise of each organization's respective managers and staff persons by
providing them with general policy guidance regarding expectations and then allowing them
to:
1) Jointly and confidentially inventory existing buildings within the community;
2) Prepare a list of building/site characteristics for each building suitable for comparative
decision-making;
3) Utilize the services of a local architectural firm to assist with comparative cost
estimation of needed renovations;
4) Coordinate all efforts with health department staff;
5) Provide to their respective governing bodies within sixty (60) days a comprehensive,
written report that includes a staff recommendation of suitable sites.
C. Jointly fund the purchase and renovation of an agreed upon building site, with the City
agreeing to issue related bonds.
Section 5. If the County does not agree to the City's request contained in Section 4, the City
expresses its intent to certify the final 2014 property tax mill levy on August 25, 2013 at a level that takes
into consideration a reduced cost of community health services, with retention of appropriate funding for
municipal animal control and shelter services.
Section 6. Effective Date. This resolution shall take effect from and after its adoption.
Adopted by the Board of Commissioners and signed by the Mayor this 16ih day of July, 2013.
Barbara V. Shirley, Mayor
[SEAL]
ATTEST:
Lieu Ann Elsey, CMC, City Clerk
g� SALINE COUNTY
COMMISSIONERS:
'r � �t Q ca COMMISSION F Dis c
b 300 W.Ash Room 209 Secoi d District
COUNTY: P.O.BOX 5040
gnpq John C Price
aril Ts +- Salina, Kansas 67402-5040 'third District
PHONE:785/309-5825
FAX: 785/309-5826
www.saline.org
PRESS RELEASE
FROM: Board of County Commissioners
DATE: July 2, 2013
RE: Salina-Saline County Health Department
The City of Salina and Saline County have been equal joint partners in the operation of the Health
Department since June 28, 1955. As the years have progressed, the Health Department has grown both
in size and in the services being provided. Neither the County nor the City have ever questioned the
quality of services being provided nor has anyone spoke poorly about those providing the services. The
fact remains that our Health Department is being funded in part to provide excess services not required
by the law. Whether or not funding is available for said services would need to be determined pursuant
to the budget process.
The City Commission, on July 1, 2013, held a special meeting setting forth historical information related
to the Health Department building, their perceived responsibilities for said building and their
recommendation for demolition of the County owned structure and improvements thereon.
Additionally, on said date, the City unilaterally terminated the joint partnership agreement that had
existed for over 58 years.
As part of the partnership entered into between the parties, the County, in 1992, purchased the current
health department building located at 236-240 N. 7th strictly from County funds. Because the City
lacked the funds to participate in the purchase, the City agreed to be responsible for the maintenance of
the building. Said maintenance included structural roof repair. The City was given the opportunity to
inspect the building and the report provided addressing the condition of the building.City staff reviewed
said report and subsequently assumed responsibilities for the building as reflected in the attached
Request for Commission Action submitted by the previous City Manager.
Since the purchase of the Health Department Building,the City has approved,via the inspection process,
improvements and alterations to the building. In May of 2012, the City determined that the roof system
was failing and closed the property. The Health Department was forced to move and the parties have
been working towards resolution of the building issues for months. Shortly after the new County
Commissioners took office, the City and the County had a joint meeting to discuss the Health
Department building needs and funding. The parties agreed to utilize the City's retained engineer to
provide cost estimates to repair the building and to work towards a continued joint operation of the
Health Department.The thought was that if the cost to repair Was excessive, alternate plans would need
to be reviewed.
The County and the City shared equally the cost of the Pikul engineering report. The cost estimate was
given to the parties in the approximate amount of$1,025,000 to repair the building.The City's response
to the estimate is to ignore it, to tear down (at the County's expense) an otherwise good repairable
building owned by the County, and to then build a building at four times the cost to repair the existing
building. Though the proposal from the City implies the new building will be no cost to the County, the
fact is that the County pays 50% of all costs of the Health Department. The City's plan is to use the
reserve funds of the Health Department and to then have the Health Department pay off the bonds.
(Since 1992, the Health Department has never paid lease payments to the County for the use of the
building). The mere fact that the bonds are proposed to be paid by the Health Department in essence is
saying that both the City and the County are paying the bonds. If there are insufficient funds, the City
and the County have to pay the difference via the "reserve fund". When the dust clears at the end of the
day, the City and the County, under the City's proposal, are building a building for an estimated cost of
$4,000.000 and will have to pay the expenses to maintain said building. Said figure ignores the
demolition cost and ignores the fact that the County no longer has, as an asset, the building the County
purchased and the City was to maintain. Assuming the Health Department has been properly funded all
these years, how is it that they will have an additional $130,000 to $150,000 to make bond payments
each year for 20 years?
The County Commission is not willing to commit to a $4,000,000 building. The current building is
sufficient for the needs of the Health Department and it is the desire of the County Commission to repair
the building. (Future contribution towards the repair of the building by the City will need to be
determined in accordance with the agreement entered into between the parties referencing structural
repair and maintenance). The City has terminated the Joint Resolution and the Health Department will
become a County Health Department. The Commission will work hand in hand with the Health
Department to identify those services to be provided as part of the budget process.The Commission will
immediately begin moving towards the repair of the building.
SALINECOUNTY COMMISSIONERS:
Randall E Duncan
COMMISSION First District
�� _ .�� Jim Gile
et. 300 W.Ash Room 209 Second District
_ {' P.O. Box 5040 John C Price
Salina,Kansas 67402-5040 Third District
PHONE:785/309-5825
FAX:785/309-5826
www.saline.org
July 9, 2013
Salina City Commission
City-County Building
300 West Ash
Salina, Kansas 67401
Re: Salina-Saline County Health Department
TO THE CITY COMMISSION :
As you are aware, the County issued a Press Release setting forth
its position with regard to the recent proposal submitted by the
City Commission. Today, the County Commission has voted to approve
a counter proposal as set forth in this letter.
Due to the City of Salina' s termination of the Joint Resolution
establishing the joint board and joint operation of the health
department, Saline County will accept the responsibility of the
continuation of the health department as a County Health Department
effective January 1, 2014 . As you are aware, the county health
board will remain in place through the end of the year.
Expenditures will be approved by both entities .
The County and the City have jointly requested a proposal from
Pikul Engineering for the purpose of determining the cost to repair
the County' s building which formerly housed the health department .
Said estimate is approximately $1, 025, 000. With the assumption
that the final estimated cost to repair said building is in line
with the report, the County proposes to repair the building in
accordance with the general plans and specifications set forth
therein. As part of this proposal, the City would agree to accept
the general plans and specifications set forth in the Pikul
Engineering report and to allow the County to move forward with
repair of the building as approved by a structural engineer.
In effort to resolve any disputes regarding the building, the
County would propose, as has been discussed in prior meetings
between the entities and in the proposal submitted by the City,
that the City pay the sum of $500, 000 to the County to be utilized
for the repair of the building. The health department has already
approved the expenditure of $500, 000 from the reserve fund.
In moving forward with the health department, the County would
propose that it retain the full fund balance at the end of the
year. As you may or may not be aware, deferred compensation
payments, retirement, sick leave, and other obligations will need
to be subtracted from the reserve fund and set aside for future
use. If the City agrees to pay $500, 000 and release its interest
in the funds, the County would have no further claim regarding the
repair of the building and would move forward with housing the
health department .
As you also are aware, effective January 1, 2014 , the health
department will become a county operated health department . In
order to continue services, it will be necessary to increase the
mill levy. The County has approximately ten (10) days to set the
budget for next year. As such, it will be necessary to budget
appropriately for the continued operation of the health department.
It is the County' s belief that the City currently has projected
funding for the health department in its 2014 budget . Knowing it
now will be a county health department, it is assumed by the County
Commission that the City will reduce its mill levy, removing that
portion allocated for the health department with the exception of
the animal shelter.
Please advise as to your position with regard to the above proposal
as quickly as possible so that budget issues can be properly
addressed.
Thank you.
Yours very 'ruly,
/ as
•andall . Dun.an, Chairman
I
Ji ile, Vice- airman
ohn C. Price, Secretary
,.... ..qg,,
Attest : `,, �C0(/�
/ COUNTY s.
ronald R. Merr 'man CLERK
Saline County Clerk %, s •.,,. ... �QS�
.,,r9E C` Ka 3,
Cc: Rita Deister "` ++
Yvonne Gibbons
Michael Montoya