Worksession Minutes
March 3, 2008

The meeting was called to order at 7:03 p.m. Present were Mayor Calvo, Mayor Pro Tem (MPT) Jewitt, CMs Dennison, Gourley and Lofgren. Also present were Town Administrator Murphy, Clerk Harper, Margeret Barrot, Kristen Buker and citizens.

1. Mayor

Agenda: A code appeal was moved up on the agenda to accommodate the appellant.

Announcements: CM Dennison wished her children Sarah and Christopher a Happy 22nd Birthday.

Calendar: No changes were made to the calendar.

Minutes: The February 13 Town meeting minutes were corrected for approval at the March Town meeting.

Department reports: CM Gourley thanked TA Murphy for the hard work he put into the preparation of this year's budget. MPT Jewitt reported that the car used by the Code Department needs repairs costing approximately $2,200. The possibility of using an older police vehicle on an interim basis will be explored. CM Dennison reported that Historical Committee Chair Cheryl Jewitt attended the small museums conference, where she collected a lot of valuable information and contacts. At its last meeting, the Historical Committee approved the wording for the Edmonston Road street marker and set April 6, 2 – 4 p.m. as the date for the book signing of Ann Harris Davidson's book “Then & Now: A Pictorial History of Berwyn Heights.” Further, a few schools in the Beltsville area have been approved for conversion to a preK-8 program pilot. Less expensive options for making the Senior Center door handicap accessible are being explored. Indian Creek appears to be less muddy recently, but contains bulk trash and debris that should be removed.

Mayor Calvo reported that Chief Murphy underwent surgery last Friday and will return to work within a week. A property on Seminole Place that was purchased 2 years ago is under foreclosure and will be sold for $220,000. A neighbor suggested forwarding the information to the police staff. Officers might be willing to move here and take advantage of the $200 per month locality pay, which the Town pays officers who live within a 5 mile radius. Raising the locality pay might be an issue for the Council to consider during the budget process as it would save the Town money over the take-home car policy. County Councilmember Eric Olson has set up a meeting with the County's Department of Environmental Resources (DER) and the Maryland Department of the Environment (MDE) to discuss pollution of Indian Creek. Mayor Calvo also raised the issues of condemning a long-vacant house on 58th Avenue and drafting legislation to improve the County's historic preservation program. Lastly, Mayor Calvo and TA Murphy have been in touch with PEPCO to repair street lights at Pontiac and 57th Avenue and Osage and Edmonston Road and have been told that they will be fixed. CM Gourley reported that he had a nice dinner at the Senior Center last Saturday, which was prepared by Dave McCaffrey.

Citizen comments: CM Dennison received a positive comment about greater visibility of officers on Berwyn Heights streets. Mayor Calvo received comments on the recovery of a resident's laptop protected by Low Jack, Town Council election deadlines, Berwyn  Heights zip code, Safe Streets Committee recommendations, lack of parking in front of the Berwyn Heights Community Center, mulch delivery service, a roaming dog as well as the proposed pension system for Town employees and the budget.

Code appeal II – 5700 Osage Street (discussed out of order): Mayor Calvo welcomed resident Kristen Buker who was in attendance to appeal a $300 fine for parking an untagged truck in the driveway of the property she is renting and explained the appeals process. MPT Jewitt outlined the case. He said that a door hanger warning was initially left at the property on December 7, 2007, followed by the first certified letter to the owners, Abdul Hatem and Nilufay Mukta, and a copy to the tenant, Ms. Buker, on December 27 giving a 14 day deadline to remedy the violation. With the violation still in effect, a $100 fine letter was sent via certified mail to the owners with a copy to the tenant on January 15. Copies of the certified letters were sent via certificate of mailing to the owner and tenant on January 4 and 22.  Additionally, the Code Department made courtesy calls to the homeowner on January 16, 28 and 29 and to Ms. Buker on January 30 to notify them of the next deadline when a $200 fine would be imposed. Ms. Buker responded by leaving a voice mail in the evening of January 30 requesting an extension. An extension was granted until 7 a.m., February 5. When the vehicle remained untagged and uncovered on the property at 10 a.m. on February 5, a $200 fine was imposed.  A property check on February 6 showed that the truck had been removed. Ms. Buker called the Code Department on February 6 to say that she was not given a specific time for the February 5 deadline and that the truck had been removed on the evening of the 5th. She also maintained that she had not received any notification regarding the first $100 fine. She was informed that copies of all letters had been sent to her and that she may appeal the fine to the Town Council. Ms. Buker did so on February 15.

Ms. Buker testified that events as outlined by MPT Jewitt are essentially correct. She reiterated that she was given a February 5 deadline without reference to a specific time and that the untagged truck was removed that same evening after she returned from work. She believes the $200 fine to be unjustified.

In response to Mayor Calvo, Ms. Buker said that she received the door hanger warning on December 7 and the first certified letter. She responded by leaving a message with the Code Department, which was left unanswered. Her request for an extension was confirmed by the code assistant to be February 5 in a January 31 telephone conversation. If she had known that there was a 7 a.m. deadline, she would have moved the truck in the evening of February 4 rather than risking getting another fine.

CM Dennison noted that Ms. Buker is a single working mother, who was temporarily unable to get the truck insured and registered. Referring to the appeal letter, she further noted that Ms. Buker felt harassed and treated unfairly by the Code Department. Ms. Buker confirmed this.

In deliberations, MPT Jewitt pointed out that the tenant confirmed receiving the first certified letter, which warns of the imposition of a $100 fine after 15 days if the violation remains in effect. Even without receiving the actual fine letter, she should have known that a fine was impending. Further, the second $200 fine was not imposed on the original due date but was twice extended, after the Code Department made courtesy calls to notify the owner and Ms. Buker of the impending fine. Ms. Buker agreed to the February 5 extension.

Mayor Calvo said that the Code Department handled the matter well and made an extra effort to reach out to the owner and tenant. However, he believes there was a miscommunication between the code assistant and the tenant about the 7 a.m. deadline on February 5. He believes a 7 a.m. deadline is inherently confusing and would prefer making close of business the regular deadline. He recommended upholding the initial $100 fine but waiving the additional $200 fine.

CM Dennison pleaded for leniency on behalf of Ms Buker, who she said made an effort to comply with the code requirements. She is a single mother with a modest income and little time, who nonetheless volunteers for the PTA and Recreation Council. She said the Town should refrain from alienating such residents and recommended reducing the fine to $50. CM Lofgren said that it is a sad case but that the character of the resident and the fact that she is well known to a Councilmember should not have a bearing on the case. The Code Department in this case did its job and made an extra effort to reach out, but enforcement of the Town's code is inherently unwelcome. Mayor Calvo agreed saying that the Council should take into account a reasonableness factor, in this case, making allowance for the miscommunication about a 7 a.m. deadline. For this reason, he would reduce the fine to $100. CM Lofgren so moved. The motion failed for lack of a second. MPT Jewitt moved to uphold the entire $300 fine. CM Gourley seconded. The motion carried 3 to 2 with Mayor Calvo and CM Dennison opposed.

At 8:12 p.m., the Council took a 15 minute break.

Town Administrator budget presentation: Mayor Calvo commended TA Murphy on providing the Council with the most comprehensive budget packet to date in what will be a difficult fiscal year. TA Murphy confirmed that the FY 2009 budget will be very tight, with revenues flat except for a 13% increase in real estate taxes. The budget is one of the most salary-driven in many years due to competitive salary adjustments implemented over the last 2 years and the rising cost of associated benefits. A 2.5% Cost of Living Adjustment (COLA) for all employees adds to the salary pressure. Other cost drivers include rising health and liability insurance rates, gasoline prices, landfill tipping fees and budgeting for the first interest payment on the pension bond issue.

In a closer look at revenues, TA Murphy said that he is projecting a 5.9% increase overall, almost all of it due to a 13% increase in real estate tax receipts stemming from the large increases in property assessments over recent years. It is proposed that the recycling tax be raised from $48 to $53 per year per household to absorb an increase in the contractor's recycling fee. Revenues from building permit fees are likely to generate more revenues as these were raised to match the County fee. Rental license fees could also be raised to cover the increasing administrative costs. Intergovernmental Revenues are projected to be flat, with the exception of a $6,500 increase in Highway User Revenues (HUR) if the estimates provided by the State Highway Administration (SHA) hold up. Additionally, code fines are slated to go up while estimates for police fines have been lowered. Interest & Dividends receipts have held up and Miscellaneous receipts have remained unchanged.

In an outline of expenditures, TA Murphy reported that the General Government budget has gone up by 3.3%, due mostly to salary increases. However, there were also increases in cost of publishing the Bulletin, audit services, payroll processing fees and conference charges and a slight increase in the maintenance budget of the municipal building. The Police budget is projected to go up 3.4%, again mostly due to salaries, and smaller increases in expenses for training, rent and uniforms. A new cruiser is budgeted under Capital Expenditures-Operating Budget. The Code Enforcement budget is proposed for an 8.1% increase, mostly for salaries, as well as for postage, supplies and communications. The Public Works Department building budget was budgeted funds to make structural repairs to the lean-to. The Streets and Sanitation budget is proposed to increase by 3% overall. A proposal for consideration was made to cut the temporary help appropriation to fund a 9th full time employee. However, the cost of health insurance for the 9th employee would have to be absorbed in the general budget. Increases were also budgeted for maintenance and repair, gas and oil and solid waste disposal fees. The Parks and Recreation budget is flat. However, a new line item was established for the Historical Committee, which is in the process of setting up a museum. The Miscellaneous budget is proposed to go up by 32%. It covers various insurance policies the Town must carry, employee health and retirement plans and, a new item, $55,000 in interest on a pension bond the Town plans to issue to join the Maryland State Pension System.

Further, a new major activity Capital Expenditures – Operating Budget was broken out from the Capital Budget. It has $144,000 to fund annual police vehicle purchases and earmarks for the vehicle replacement reserve. This was done to avoid confusion as to what is funded by surplus. The Capital Projects budget is slated to decrease by 12.3%, with only police radios to be newly item funded from the surplus. The Public Safety Taxing District (PSTD), now in its 3rd year, is set to fully fund one police officer. In order to include the officer's retirement benefits, however, an additional $4,000 must be generated. Although not included in his proposal, he said this could be done by raising the PSTD real property tax rate by 1 cent per $100 of assessed value.

Under comments, Mayor Calvo said that there are additional factors that make the FY 2009 budget tight. The economic slowdown is likely to reduce revenues as it affects peoples' and businesses' ability to pay taxes and service charges. There may be a sizable decline in personal property tax receipts, as Verizon is undergoing a reassessment of its personal property. TA Murphy is in touch with Department of Assessment and Taxation (MDAT) to learn more. Highway User Revenue was projected to go up but the exact amount remains uncertain. There is also uncertainty about health and liability insurance rates and code liens. He continues to believe that the surplus should be protected for large capital purchases that will have to be made in the near future. With flexibility in the budget reduced, he would give priority to hiring a 9th public works employee, if the funds become available.

CM Dennison said that she would like a cost estimate for the Code Director's rental license processing work that might serve as a justification for raising the rental license fee. She suggested that money might be saved by looking for a less expensive payroll processing service and reviewing the take-home car policy, if gas prices continue to go up. She supports the hiring of a 9th full time public works employee but would also like the Senior Center door made handicap accessible and the Town Center grounds landscaped, if money is available. CM Gourley sought clarification on the maintenance costs of the Town Center and asked, if an increase of 1 cent in the PSTD real estate tax would cover all expenses associated with the 8th police officer. He was told that it would not. Another 1 cent increase in the PSTD real estate tax would be needed to cover health insurance. TA Murphy noted that there are currently 3 employees that are not paid within their salary range outlined in the salary plan.

Mayor Calvo thanked TA Murphy for the summary and said that at the next worksession the budget will be discussed in more detail and motions to shift funds around can be made.

Bond ordinance: TA Murphy explained that the Council has in hand the draft of a traditional bond ordinance, which sets forth its terms and conditions. However, it is still missing the maximum amount that is to be borrowed. This should be $1,065,000 plus the closing costs. Additionally, the exact wording of the question, which is to be put before the voters at the upcoming election, has not yet been settled.

Mayor Calvo said that the ballot question should be as simple as possible and spell out the purpose of the bond issue. He suggested as possible wording: “do you or do you not authorize the Town to borrow money up to the specified amount to join the Maryland State Pension System.” He further argued that the specified amount should be the number that the Council has used in its deliberations and publicized in the Bulletin and in discussions with residents, e.g. $1,065,000. Closing costs do not have to be part of the bond issue but can be financed in other ways. The actual amount of the bond issue depends on several factors not yet known, such as the interest rate that can be negotiated. The point is to cap the amount to be borrowed.

The Council agreed to keep the wording of the ballot question simple and to use $1,065,000 for consistency. CM Lofgren advised that the Town thoroughly explain and publicize the issue so that residents are familiar with it. He further suggested a short paragraph should be included on the ballot that explains the more technical language of the ballot question. Mayor Calvo liked the idea and instructed TA Murphy to work with bond counsel and the Town attorney to finalize the question. The Council would review it at the next worksession.

Pension plan: Mayor Calvo explained that The Segal Company, which performs actuarial studies for the Maryland State Pension System, has made a serious error in switching from an aggregate to an individual methodology when making actuarial calculations. This error affects the entire pension system as well as those municipalities that wish to join and have been evaluated by The Segal Company, including Berwyn Heights. As a result, the cost calculated to pay for the Town's accrued liability contribution of the employee's contributory pension system, or the $1,065,000 needed to give credit for 1/3 of prior years service, is cast in doubt, as is the annual contribution rate of 9.14% going forward. Another actuarial company has been appointed to check all valuations but will need time to perform the calculations.

Mayor Calvo and TA Murphy have been in touch with the pension administrators to request that Berwyn Heights' valuation be checked as soon as possible so that the bond issue referendum can go forward as planned. The request has been granted but new numbers have not been received. Additionally, firm numbers won't be available until the end of the fiscal year when the annual rate of return for Pension System investments is known and Berwyn Heights has provided the actuaries with updated employee data. However, the Town must decide whether to join before the end of the year. Mayor Calvo acknowledged that this complicates the process of joining but he hopes that a firm number for the annual contribution rate will be available by the April Town meeting, at which time the Council plans to adopt the bond ordinance. The Town Administrator is also researching pension systems insured by private companies, such as TIIA-Creff and AIG, as possible alternatives to the State Pension Plan.

No items were discussed under the Departments of Parks and Recreation, Police, Public Works and Administration.

6. Code Enforcement

Code appeal I – 5700 Goucher Drive: Mayor Calvo noted that the appellant, Colin Stefan, is not present. He was informed that an unknown individual was in attendance earlier but has since left. MPT Jewitt explained that Mr. Stefan is the resident owner of a rental home and is appealing a $100 fine for late filing of a rental license renewal application. The Code Department sent a 30 day notice of the renewal due date to Mr. Stefan on December 28, 2007. When no application was received, a $100 fine letter was sent via certified mail on January 29, 2008, followed by a February 12 copy of the fine letter via certificate of mailing. On February 25, the Code Department received the application and $210 license renewal fee, as well as a letter of appeal. In the letter, Mr. Stefan states that he was out of town in late December and early January and never received the license renewal notice. Further, he was unaware that his rental license was due to be renewed and therefore did not make the payment in time.

In deliberations, MPT Jewitt said that the home owner acknowledges being remiss about renewing his license and not responding to the first certified letter. Mayor Calvo said that the late fee is milder than the $200 fine, which could have been imposed for renting without a license. MPT Jewitt moved to uphold the fine. CM Gourley seconded. The motion passed 5 to 0.

The meeting was adjourned at 10:35 p.m.

Kerstin Harper, Town Clerk

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