HomeMy WebLinkAbout02/23/2015 Work SessionCity of Springfield
Work Session Meeting
MINUTES OF THE WORK SESSION MEETING OF
THE SPRINGFIELD CITY COUNCIL HELD
MONDAY FEBRUARY 23, 2015
The City of Springfield Council met in a work session in the Jesse Maine Meeting Room, 225 Fifth
Street, Springfield, Oregon, on Monday February 23, 2015 at 5:30 p.m., with Mayor Lundberg
presiding.
ATTENDANCE
Present were Mayor Lundberg and Councilors VanGordon, Wylie, Ralston, Woodrow and Pishioneri.
Also present were City Manager Gino Grimaldi, City Attorney Mary Bridget Smith, City Recorder
Amy Sowa and members of the staff.
Councilor Moore was absent (excused).
1. Regional Accelerator and Innovation Network (RAIN) Introduction.
Gino Grimaldi, City Manager, introduced Jackie Mikalonis, Regional Solutions Team Coordinator and
Jim Coonan, Executive Director for RAIN. Mr. Coonan presented a power point presentation.
Ms. Mikalonis said the Regional Solutions Team of Linn, Benton, Lincoln and Lane County areas
have chosen projects for the next legislative session. Lee Beyer is the convener for Springfield,
representing local interests. The priority project for economic development in Springfield's region is
RAIN. That project is moving forward for funding during this legislative session. Springfield was
extremely involved in putting the pieces together in the first place.
Mr. Coonan said he has been involved in entrepreneurial activity for the last fifteen years across the
state in a variety of ways. He was delighted to be part of this objective. Last summer, he came out
and met with the Mayor. The City of Springfield provided initial funding for RAIN to map out a
strategy of how to move forward. An entrepreneurial hub will be established. A meeting will be held
with Mayor Piercy, the University of Oregon, Springfield and Lane County to talk about how to move
the project forward.
Mr. Coonan said the economic development stool is made up of three legs: opportunist recruitment;
retention; and innovation and entrepreneurship (RAIN's focus). He discussed the impact of
entrepreneurship and suggested they read the Kauffman Foundation study which showed that net job
growth from 1977-2007 was generated by companies less than five years old. Those businesses that
have truly innovative products and services will do well even during economic downturns. He noted
that regions with few large employers need a strong entrepreneurial ecosystem.
Mr. Coonan said the RAIN program is focused on primary jobs that bring new revenues into the
region, and trying to increase the odds for early stage companies. Research shows how to increase the
odds, including a lot of advisory services and small amounts of capital. Advisory services are people,
mentors, networking, accelerator programs, and supporting services (physical space/incubators and
access to equipment and labs). In addition to advisory services, robust connections to business
networks and resident capital are needed. Combining these elements can double the success rate for
early stage companies. The goal is not only to have more successful start-ups, but more of them that
stay in the region.
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Council Work Session Minutes
February 23, 2015
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Mr. Coonan said Regional Solutions developed a strategy to address the innovation economy for
South Willamette Valley and brought the two universities (University of Oregon and Oregon State)
together. They developed a partnership of governments, higher education, business community and
entrepreneurs to advance the formation and growth of tech -based startups regionally.
Mr. Coonan discussed the legislative funding for RAIN and how they had been building up a match
from public and private entities. To date, they have $2,771,901 or 74% matching funds.
Mr. Coonan said the RAIN strategy was to:
1) Launch the accelerator in Eugene, support the OSU Advantage Accelerator in Corvallis
2) Develop the Innovation Network: regional resources linked and navigable.
3) Develop early stage, resident capital for region
There were two graduating classes in Corvallis, with twelve total companies. He noted the companies
that had gone through the process in both Eugene and Corvallis.
Mr. Coonan said to date, both accelerators were launched, RAIN was incorporated and a board
established in May 2014, RAIN was 501c3 accredited in November 2014, they achieved 74% of
funding match from legislature in December 2014, and $750,000 of new sources of capital for the
region were created. In addition, they had been identified as a Regional Solutions priority for the next
biennium, and both Eugene and Corvallis were working on developing strategies for entrepreneurial
nodes.
Councilor Wylie asked who decides if a project idea is eligible.
Mr. Coonan said there is a Chief Start-up Officer for each of the accelerators. Applications are
submitted to the Officer who reviews them and provides feedback to the applicants in terms of
whether or not it is a good fit. If it is not a good fit, the Officer provides direction on where the
applicant should go or what they need to do to make themselves ready for the program. In addition,
they are developing a pipeline of new ideas. There is a group called Ferti-lab with a program called
Ideate which helps people get ready for the accelerator program.
Councilor Wylie asked if there is a cost for the project applicant.
Mr. Coonan said there is currently no cost. In the future, they may be asked to give a small percentage
(1-2%) of the company. Currently, Corvallis takes I% of the company as well as some earn -out if the
company is successful which would go back into the accelerator program. If the company is not
successful, they owe nothing.
Councilor Pishioneri asked if the capital was in the form of grants and not loans.
Mr. Coonan said that particular pool of $750,000 in capital was put together by a graduate student at
the University of Oregon (UO) and the UO Foundation. Those funds are grants helping the companies
get a start. Anyone that uses those funds has to be affiliated with the UO. It is not part of the $2.7M.
He explained that the $2.5M from the legislature was capital funds for bricks and mortar that was split
between the UO and Oregon State University. The $750,000 was a resource for the early-stage
companies. The rest of the funds are for operating costs to help with the day-to-day operations of the
Accelerator Program, marketing and other activities. There are no capital funds for businesses that are
not associated with the UO, although they hope to create regional based funds in the future.
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Councilor VanGordon asked about those that had gone through the twelve -week Eugene RAIN
program and if those companies were performing better. If not, he asked when they could expect them
to perform better.
Mr. Coonan said success of the program means they will come out as fully formed companies ready
for investment. The ultimate stage of success is how many jobs are created for our region. Those
going through the Accelerator agree to share information about their company with RAIN.
Councilor VanGordon asked if they would have a better vision of success at a future update.
Mr. Coonan said they have a series of metrics they will be judging themselves on. The primaryjob
metric is how many jobs are created. Another metric is how much capital they have been able to
attract. The third metric is the number of students involved in the process.
Councilor VanGordon said he would like to know those results as it would help gauge the success of
the program. He would like to see those figures at the end of the year to know if the energy and effort
being put into this as a region is paying off.
Ms. Mikalonis said they have a lot of strong economic development efforts in the region, but noting
that was developing a strong eco -system for start-up companies. They want to make sure they have
the resources needed for these companies in 6 months, a year, or longer so they don't lose them to
other regions.
Mr. Coonan said he would send Council the series of metrics and their goals.
Councilor VanGordon asked how many of these companies came from the UO.
Mr. Coonan said about half, and the other half has come from the community.
Councilor VanGordon asked how they can move past the `innovation' to get a healthy environment.
Mr. Coonan said another metric was the number of people graduating. The Accelerator represents a
segment in time and they are trying to look at companies before and after. Their first priority is the
pipeline of companies coming into their program. They are trying to create communities of
entrepreneurs that will be an opportunity to share ideas. As RAIN develops, they want to look at what
to do after they graduate and how to embed them in the program and the community. He provided an
example and noted that some companies die because they are not tied to the correct resource. The
program needs to provide opportunities for those connections.
Ms. Mikalonis said each company has different needs.
Councilor Woodrow said she saw a presentation on this at City Club about a year and a half ago, and
feels that Springfield has been ignored since then. Her biggest concern is how RAIN will present this
in Springfield to gain interest and how will it benefit Springfield.
Mayor Lundberg asked who was on the regional solutions team.
Ms. Mikalonis said the advisory committee consists of people from Linn, Benton, Lincoln, and Lane
counties. Their representation includes a commissioner from each of those counties and a variety of
people from the public and private sector. Lee Beyer is the convener from Springfield. The League of
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Oregon Cities (LOC) designee is Mayor Piercy, the private sector designee is Nick Fowler, the
philanthropic representative is Casey Woodard from Cottage Grove, the Lane County representative is
Commissioner Faye Stewart, the Linn County representative is Commissioner Will Tucker, the
Lincoln County representative is Commissioner Doug Hunt, and the Benton representative is
Commissioner Annabelle Jaramillo. The Presidents from all three community colleges and Vice
Presidents of research and innovation from UO and Oregon State University also sit on the committee.
They meet and work with communities to set high level priorities for the region and designate and
monitor what the regional solutions does. The Regional Solutions Team includes the coordinator and
representatives from many of the State departments. When they have community development issues,
they bring those people to the table and collaborate with federal and local partners.
Mayor Lundberg asked who chose RAIN as a priority.
Ms. Mikalonis said it was chosen by the Advisory Committee.
Mayor Lundberg said Springfield was included in the beginning, gave some funding, and then this
went forward. She completely understands that the two universities and the communities that house
those universities are the natural place to build the Accelerators, and there is a need for them.
Springfield will be ready if one of these companies needs a building, but it sounds like that won't
happen for some time. The gap from the time they graduate until they are ready for a location, etc. will
take time and money. Since she realized RAIN was the universities and their respective cities, she
went to advanced wood products to see what Springfield had to offer. We have mills, people that
know how to work with wood, and we need a parking structure. She and others from Springfield went
to the UO Architect department and asked them to do a Spring class where the students design a
parking structure out of cross -laminated timber (CLR) or glue -lam that could be a demonstration
project. She skipped over RAIN in that process since they knew who was working on this idea. She
asked if this was just a report or if they want something from Springfield.
Mr. Coonan said this is just a report, but it is supposed to be regional initiative. They are creating an
entrepreneurial hub and would like to kick off the discussion with Mayor Piercy, Mayor Lundberg, the
university and Lane County to bring people up to speed and figure out how to make it a reality. They
have most of the funding, but want to get people involved. He invited one or two members of the
Springfield Council to meet with them and brainstorm ideas of how they could work together. The
Advisory Board is meant to meet twice a year to share information and gather input.
Ms. Mikalonis said this is always a work in progress and they just got the funding less than a year ago.
Mr. Coonan asked that they let him know who has the interest and who they could meet with to share
what RAIN is doing and how they can get information out and get more involved in helping
entrepreneurs.
Mayor Lundberg said that is good to hear, but it did sound like they still need funding and
participation. She wished them all the best and success. For the Springfield community, she sees us
figuring out what we can do best. Her goal is to have the wood parking center and restaurant, with the
help of the UO students, that would bring people from all over the world to see what we can do with
wood products. She met with people from the Department of Forestry in Washington DC who will
help Springfield. The products are out there and need to be developed better. There are a lot of
opportunities to have a couple of tracts and they could perhaps participate on the Advisory Committee.
She asked about the status of the Regional Solutions with the new Governor.
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February 23, 2015
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Ms. Mikalonis said the new Governor introduced everyone to her four new staff people. The Director
of Regional Solutions met with the new Chief of Staff and provided them with the packet of
information and priority projects. The new Chief of Staff asked that the team be patient as they move
through this transition, but she hadn't heard that Regional Solutions were going to change.
Mayor Lundberg said she had held discussions with the State about Springfield's mobile home parks,
redevelopment and the need for housing. She hopes that doesn't get lost.
Ms. Mikalonis said the Community Housing staff member from Regional Solutions did meet with the
team last week. Ms. Mikalonis met with John VanLandingham in Salem about the project to make
sure they keep it moving along. They are still exploring both short and long-term solutions, but aren't
losing sight of those priority projects. The manufactured home parks in the Glenwood redevelopment
area are on their list, as well as permitting for Swanson Mill.
Mr. Coonan said it is appropriate Springfield is working with the UO regarding the parking garage.
Mayor Lundberg said it is a very complicated topic and we need a finished product. She appreciated
them coming in and providing a report.
Councilor Pishioneri asked if they had looked at amount of money going into the program and the
economic return.
Mr. Coonan said that is part of the metrics. Based on his experience in Central Oregon, it is a very
high leverage opportunity.
Councilor Pishioneri said he would be interested in those results.
Mr. Coonan said if they felt there were more appropriate metrics, to let him know.
2. Master Fees and Charges Schedule — Spring 2015 Update.
Finance Director, Bob Duey, presented the staff report on this item.
Each year, Council and staff review existing fees and charges for appropriateness of rates for meeting
cost recovery targets as well as reviewing for areas where new or additional fees should be considered.
The Spring of 2015 review will focus on updates for annual impacts of inflation, new fees and
omissions as directed by Council. This second of two work sessions will address those fees changes
presented at the first work session that staff was asked to bring back to Council with further
explanation.
The four fees for follow-up are:
• Section 1 General Fees — Merchant Fee Change
• Section 3 Library Services — Non -Resident Fee for Library Card
• Section 4 Municipal Court — Probation Violation Fee
• Section 9 Utilities — Telecommunication Business License Tax
Mr. Duey explained the information requested for each of those four fees.
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February 23, 2015
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General Merchant Fee
This was a new fee recommendation that would allow the City to charge an additional fee to
patrons who chose to pay by credit card. Recent law changes to banking practices made it
allowable to charge up to an additional 5% for the privilege of the use of a credit card.
Recommendation was for a new fee of 2%. Council asked staff to explore the option of a tiered
fee where the fee would be applied to only those transactions that were over a certain dollar
amount.
Upon further study staff is now recommending that this new fee under consideration be removed
from the recommended list and not pursed at this time for reasons, including both the merchant
card service providers and the City's own technology capability. Looking in to the
implementation strategy to collect this fee showed that the technology does not exist within the
City's multiple billing and collections programs (Accela in DPW, Tyler in Court, Ambulance and
Fire Med billing in Fire, etc.) to charge and collect this fee without a very large degree of staff
time and training. This would revert over the counter collections to a highly manual process or an
entirely new series of point of sale terminals. Customer understanding and satisfaction would
decrease. The technology gap would exist whether the fee was implemented as originally
requested as a single percentage on all fees or the consideration of a tiered percentage based upon
dollar value.
Councilor VanGordon said if they pulled that fee, he would like to look at lowering the limit on what
amount was allowed to be charged to $5000.
Mr. Duey said he would look how often people used credit to pay for services between $5000 and
$10,000 and bring it back to the public hearing.
Councilor Wylie said it could be an anti -growth factor for developers so they needed to be careful.
Councilor Pishioneri said he agreed.
Councilor Woodrow said she had seen where companies were starting to charge fees over a certain
amount. She would like to seethe revenue from charges between $5000 and $10,000.
Mr. Duey said those larger amounts would likely all be in building and planning. The process of the
limit is a manual process, so would be the same in terms of staffing whether it is $5000 or $10,000.
Non -Resident Fee for Library Cards
The sale of non-resident library cards is an existing fee that has previously been set at $80 for a
full year, $46 for 6 months, $23 for 6 months and $9 per month. The recommendation from
Library staff was to increase the annual fee to $85, the six month fee to $50 and the 3 month fee to
$25. It was also recommend that the sale of monthly card be discontinued. Council's question
concerning this fee increase was cost to non-residents and the revenue that was raised for city
services from non-resident library users. The following is some information about the Library's
patron card program:
We have several types of cards but the main 3 types are:
o Patron cards that are supported by taxes (e.g. city residents -14,801, city property
owners)
o Patron cards that are purchased (e.g. paid non-resident cards)
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o Patron cards that are issued to non-residents for no charge (e.g. School District 19
teachers & educational assts. — 47, city employees & their families - 92, non-resident
volunteers who work in lieu of payment 19 — we have a limited capacity for the
number of volunteers we can accommodate.
• Non-resident cards that are paid for: 419 Revenue: $18,503 (Includes Gift of Literacy
Cards for 1St graders that are paid for by a Rotary / Wildish family grant).
• Only the third category could be construed as being "free" since the Library receives no
revenue for providing services to them. Half of that group is made up of city employees
and has been offered as a benefit for decades. Of the 92 CE cards only 66 are actual city
employees. There are 47 School District teachers or educational assistants who take
advantage of the opportunity to receive a library card. This was a request through Team
Springfield & Nancy Golden early in my tenure here.
• There are essentially no other "free" cards since either tax dollars or payment is received
for the other two categories of cards.
• The value of 2014 Gift of Literacy cards was determined by the number of 1 st graders
living outside the city limits. That is, the number of families not individuals, living
outside the city's service jurisdiction. In last year's case it was 65 first graders X $80/year
_ $5,200. By the way we have just received an "estimate" from the school district that
they have 780 total students living outside the city limits. It was the district's
recommendation that we divide that number by 2.5 (average number of kids per
household) and that brings us to 312 families that would receive a card for their
student(s). 312 X $80 = $24,960. We based the amount requested on the actual value of
the cards issued.
Councilor Pishioneri confirmed that the charge was $46 for 6 months and $23 for 3 months. He asked
if the City of Eugene or other municipalities gave their employees who live outside city limits free
Library cards.
Mr. Duey said he could find out. Springfield provides 92 cards to employees and their families who
are not Springfield residents. It is not treated as compensation.
Probation Violation Fee
This fee is currently in existence and showed up as a change in the Master Fee and Charges
Schedule as the last printing inadvertently omitted the fee from the printed copy. There are no
recommended changes to the fee. Council asked staff to review the statement that "the fee may be
waived at the discretion of the judge".
Upon review it was found, although seldom used for this fee, this phrase exists for the benefit of
the Court in providing the Presiding Judge the ability to exercise judgment on a defendant's ability
to pay. When accessing a fee, the Judge bears the responsibility to make a finding if a defendant
can afford such fee and if determined that they cannot, the Judge must be willing to modify or
waive the fee. A quick look at a court records show that this seldom occurs for parole violations.
It is recommended that this fee remain as currently described.
Councilor Pishioneri said ORS 137.540 gives the authority so he concurs with the recommendation.
Other courts in our region are converting fees to community service time/work crew time. He would
like the City to look seriously at a work crew program that can be applied to people that have assessed
fees and fines as a way to work them off. He would like to have a proposal brought to the Finance/
Judiciary Committee for discussion.
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February 23, 2015
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Mayor Lundberg said there has been some discussion about that topic. It would be good to send it to
the Finance/Judiciary Committee for review and recommendation to the Council.
Chief Doney said they are in the process of exploring that with the lieutenants, and can then work with
the Finance/Judiciary Committee. Some further research needs to be done, the lieutenants should be in
place by April, and they can then bring something to the committee in the Fall.
Councilor Pishioneri asked the Chief or his designee to work with the Finance/Judiciary Committee on
timing.
Compensation Fee for Use of Public Ways
This fee is currently in existence and showed up as a change in the Master Fee and Charges
Schedule as the last printing inadvertently omitted the fee from the printed copy. There was no
recommended change to the fee. Council asked staff to review the current $3.85 per foot fee for
appropriateness.
The per foot fee is for provider of utilities and telecommunication services who use the city's
rights of way space to run communication lines through the city. These lines do not provide
service to the residents of the city but do use the city's rights of way taking up rights of way space
in the ground or on poles. The fee is a way to charge rent, for example, on that space. This fee
was first defined in Resolution 1-11, February 20, 2001 and it set the fee at 2.25 per foot. There
are three more resolutions that incrementally increase the fee over the course of 10 years;
Resolution 6-29, 6-19-2006, raises the fee to 3.25 per foot, Resolution 8-26, 6-2-2008 raises the
fee to 3.50 per foot, and finally Resolution 11 -23, 6- 20-2011, raises the fee to 3.85 per foot.
Using comparative Oregon city data from an Oregon Association of Telecommunications Officers
& Advisors survey shows that the majority of cities charge $4.00 to $5.00 per foot. Specifically
the City of Eugene charges franchisees $4.00/foot and non -franchisees $5.00. The City of
Corvallis has set a rate for telecommunication providers at $3.70 per foot.
Mayor Lundberg asked how much revenue we would get if it was raised to $4.00.
Senior Management Analyst Rhonda Rice said it would be about $1000 or less.
Council discussed whether or not to raise it to $4.00, or raise it 2% now and review it again next year.
The fee does not affect Springfield residents. Consensus was to increase the fee to $4.00.
Council asked staff to continue to bring the rest of the fee schedule back annually.
Mr. Duey said there will be more fees and charges coming forward from staff because it is the only
avenue we have to keep services at the current level. It is a critical point in the city's financial stability
without service reduction.
Councilor VanGordon asked about the cost recovery for the City and what is at the bottom of the list
and getting very little cost recovery.
Mr. Duey said you would need to look at each fee individually because there are so many services that
don't have fees or have very few fees associated with them, such as Public Safety which makes up
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about 70% of our General Fund. They need to look at what services are for the public good that
deserve a subsidy from property taxes, and which services should be paid for out of fees and services.
Mr. Grimaldi said through Priority Based Budgeting, they look at programs and revenue in broad
terms. That could be the beginning of the discussion.
Councilor VanGordon said he would be interested in getting information on fees that are already in
place.
Mr. Duey said planning fees have moved from 80% to 60% to 40% based on what the Council felt was
for the public benefit. The Master Schedule tries to identify all fees and the best way to move forward
for cost recovery. Many services that have no fee are not included in this packet.
Mayor Lundberg said it would be best for the Council to think about the priorities of city government
and what we are paying taxes for, and then look at the rest that benefits fewer people and look at fees
for those services. They each need to divide those out in their own mind to narrow the list.
Mr. Duey said about ten or fifteen years ago, all street repairs were part of the General Fund. Over
time, that had changed and we were looking for other forms of revenue to fund streets. Cities need to
find more of those areas to cover those costs due to tax limitations.
Councilor Wylie said in the last few years, the federal government has pushed expenses on to the
States, who have then pushed it on to the cities who have the least ability to raise money to pay for
these expensive things.
Mayor Lundberg said Council should do a self-assessment to decide if they want to look at something
further, and then bring it to the Finance/Judiciary Committee members. They can then discuss that
along with the work crew idea.
ADJOURNMENT
The meeting was adjourned at 6:58 p.m.
Minutes Recorder — Amy Sowa
Christine L. Lundberg
Mayor
Attest:
Amy Sow
City Recorder