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HomeMy WebLinkAbout03-25-02 Finance Com Minutes-Law Director ContractDublin City Council Finance Committee of the Whole March 25, 2002 Attending: Ms. Chinnici-Zuercher, Chair Mr. Kranstuber Mr. Lecklider Mayor McCash Mr. Smith, Law Director Ms. Readler, Assistant Law Director Ms. Grigsby, Interim City Manager Ms. Hoyle, Director of Fiscal Administration Ms. Chinnici-Zuercher called the meeting to order at 7:05 p.m., noting that tonighYs meeting has been scheduled to discuss the Law Director's proposed contract as referred to Finance Committee. The contract with Mr. Smith was referred to Committee for further discussion regarding the contract, including the length in view of the transition period until a new City Manager is hired. She asked Ms. Grigsby to prepare information for this meeting, and a packet was delivered to Council members on Friday with materials, including cost of legal services for Dublin compared to other Ohio cities, and estimates of costs for an in-house legal counsel if Council wants to explore that option. Mr. Smith also has a brief presentation regarding his services and his assessment regarding outsourcing some of these services. Mr. Smith stated that he serves as the appointed Law Director of Dublin. There are 13 people in the public law department who work on Dublin matters on a daily basis. In addition, Bob Weisman handles labor negotiations, Jim Davidson is overseeing two major pieces of legislation, and Greg Baker works on land acquisition. Currently, there are 568 active files, and approximately 85 of those are worked on regularly each month. The City Manager authorizes requests for legal services and the City bill is itemized each month. Their services include land acquisition, special projects, annexations, general legal matters, zoning, and tax collection. Last year, the firm collected over $200,000 in delinquent tax collections and approximately $25,000 was paid in fees for these services. Major projects currently include Ballantrae, Woerner Temple acquisitions, water and sewer line land acquisition, right-of--way cases, southwest traffic calming, Dan Sherri, Dublin Road bikepath, Hanna Hills, Avery Road, Post Preserve, Butts property, Vic Irelan negotiations, and Davis land acquisition. He then enumerated the various litigation cases the City is currently involved in. Another project underway is the zoning code revision and 35 tax litigation cases. They are also working with Dublin Town Center II on a lease, Union County township boundary adjustments, special projects with Shawnee Hills, and a Muirfield property owner issue. Mr. Smith noted that he had proposed atwo-year contract with the City of Dublin, and an issue was raised about the fact that Dublin is in a transition period until the new City Manager is hired. They asked for atwo-year contract for staffing purposes, as they hire new associates in September and would have a better expectation of the needs for staffing for Dublin. As Council may have concerns about how the Law Director will relate with a new City Manager, he would propose an 18-month contract as an alternative. This would provide the new Manager with a year to assess how they work together, but would still keep the contract in sync with the Council members' terms. They are also requesting a modification of their contract for the Mayor's Court portion of their services. There are two prosecutors doing this work, and the volume in Mayor's Court has become extremely Finance Committee of the Whole March 25, 2002 Page 2 high. At the current time, about $20-25,000 of the costs are written off each year, based on the current flat fee. The City Manager has suggested that the flat fee be changed from 6200 per month to 7500 per month. He added that they appreciate Dublin's business. Schottenstein, Zox and Dunn has the largest public law group in Central Ohio. In comparing the possibility of in-house services, it is important to note that the experience level of their attorneys is significant. They hire from the top five percent of the law school class, and they believe they provide the best possible services. He then offered to respond to questions. Ms. Chinnici-Zuercher asked for information on the process for assigning items to the Law Director versus what is handled by administrative staff. Ms. Grigsby responded that a request for professional services form is filled out by the department/division head, explaining the need for legal services. She reviews the request, and if approved, it is forwarded to Mr. Smith. Ms. Chinnici-Zuercher asked if the requests all fall within the categories specified. Ms. Grigsby responded that generally they do. Anything where a significant amount of time is required or a written legal opinion is expected requires a request form to be filled out and approved. Mr. Smith stated that they produce about five written opinions per month for various staff people. General legal services include things such as contracts for entertainers for City festivals. Mr. Kranstuber stated that at one time, he had discussion with the former City Manager regarding items referred to the Law Department, such as land acquisition work, where the work could be done by non-legal staff up to the point of filing eminent domain cases. Mr. Hansley had indicated that at times, the work is referred to legal staff because of the volume of work already being handled by in- house administrative staff. Ms. Grigsby stated that staff has been reviewing the option of in-house staff working on many of these types of projects. The Evelyn Davis property acquisition was handled mainly in-house. The Vowel property acquisition was handled by both legal staff and in-house staff. If there is a potential for legal issues to arise, generally legal staff is brought in at the outset. Mr. Kranstuber stated that he understood that with a heavy staff workload, sometimes items were referred to Legal staff for quicker turnaround. This seems a more expensive way to handle things, however, and maybe there is a less expensive alternative. Mr. Smith stated that since Ms. Grigsby has taken over as Interim Manager, she and Mr. Ciarochi have handled most of the land acquisition negotiations. Jerry Ryser from the Engineering division handles right of way issues -talking with the residents about impact on their properties. He handles surveys and legal descriptions. Mr. McCash asked if there is a benefit to either the City or to the Law Department to consider having a paralegal or staff attorney in house to handle routine matters. This person could handle the minor items, such as staff inquiries and right-of--way matters. Finance Committee of the Whole March 25, 2002 Page 3 Mr. Smith noted that Ron Whittington, Risk Management now handles many routine matters previously referred to the Law Director. The tax collection work is referred to Legal when there is no response from letters sent by the Dublin Tax Administrator. Much of the paperwork is done by a part-time paralegal at their firm. He would not be opposed to having a paralegal in-house handle this type of work. Ms. Chinnici-Zuercher asked if Ms. Grigsby would have an educated guess about how many hours could be relieved from referral to the Law Director if someone internal could handle these -would it be afull-time or part-time job? Ms. Grigsby responded that during the past several years, with the large number of roadway projects, there would have been adequate work for afull-time person in house. There are not as many active roadway projects at this time, but there are land acquisition matters which could be handled by a person in-house. It would then be a matter of determining who would manage an in- house person without having the expertise to do so. Mr. Smith stated that their firm had discussed having a contract lawyer at some future point who would be assigned to Dublin full-time to handle routine matters. He noted that on any given day, there are 8 attorneys in his department working on Dublin matters. In Dublin, the volume of work is ten times that of other cities which are already built out. Ms. Grigsby stated that she has discussed with the Law Director the problem of outside people calling him with items that aren't really legal matters, but more administrative. Sometimes they call because they don't believe they have been given the correct response from staff, or they have not had a response from staff within the expected timeframe. She has indicated to Mr. Smith that he needs to advise people that these issues should be addressed with her or with Mr. Ciarochi. Many of these are not legal issues. Mr. Smith added that he has directed people to contact Ms. Grigsby about these kinds of issues. When people have taken issue with the lack of response or with a rnling by adivision/department head, he has directed them to contact Ms. Grigsby. Ms. Grigsby stated that in preparing for the next operating budget, staff could explore what kind of things could be handled by administrative stuff versus legal staff. Mr. McCash agreed that much of the right-of--way negotiation, surveys, etc. could be done in-house versus by legal staff. Ms. Chinnici-Zuercher stated that perhaps staff could review the actual functions being performed currently by the legal staff, and a determination could be made of what needs to be done by a legal professional versus a lay person. It would be important that the legal staff is able to rely upon the information done by the lay person -there must be a comfort level that the product is reliable and that training is provided to ensure this. Mr. Smith noted that in regard to Mayor's Court, discussion has taken place about assigning a staff member there. But the current policy in Dublin's Mayor's Court is to have adequate staffing to ensure that people can get through the process in a reasonable amount of time. This has required having three attorneys there at times, due to the high volume. Finance Committee of the Whole March 25, 2002 Page 4 Mr. Kranstuber asked who makes the decision to use other outside counsel, such as Squire, Sanders. Ms. Grigsby stated that Squires, Sanders has long served as bond counsel for the City, but for other issues, the Law Director makes a recommendation to Ms. Grigsby regarding outside counsel. Mr. Kranstuber noted that in the memo comparing the cost of legal services in other cities, was there information about the process used -was it a bid process? Ms. Grigsby stated that many cities have had the same outside counsel for a long period of time. Westerville has used Porter, Wright since the 80's; Worthington has used Baker, Hostetler for 15 years. She is not certain about what process they used. Once a relationship is established and there is a history, changes are not often made unless there is a problem of some sort. Mr. McCash stated that if there were a desire to switch firms, what kind of costs would be incurred with such atransition? Mr. Smith responded that he had this discussion with the former Manager, and indicated that it would require asix-month transition for the normal items. He has assisted in such transitions for other cities -generally he would expect it to be a 6-8 month process. Mr. McCash stated that with the volume in Dublin, would a transition create a huge backlog in terms of response and service? Ms. Grigsby stated from her standpoint of working with the same bond counsel since she has been here, it would be difficult to switch firms -the new counsel would have to learn the history, the philosophy, the details of all the existing items. Similar to when any long-term department division head leaves, there is a transition period required. Mr. Kranstuber noted for the record that he believes the salary estimates in the memo for in-house staff attorneys are extremely high, based on his knowledge. They may be almost double what the starting salaries are for City attorneys he is familiar with. An Attorney 2 at the state would likely start at $35-38,00, and a City attorney in Columbus would likely start at about $30,000. Ms. Grigsby stated that the focus in this was to slot these positions within the City's current salary schedule in view of the professional level desired. Mr. Smith believes that the support staff numbers are actually too low in this memo. Mr. Kranstuber stated that the paralegal salaries are twice that of what his experience indicates. Mr. Smith noted that the paralegal range at SZD is $35-50,000. Mr. Kranstuber stated that a large firm is different - he can obtain salary survey information from the State Bar Association to support his figures. Mr. Lecklider stated that he works for the Attorney General's office and they hire a very good class of attorney at an entry level in the $30,000 range. Mayor McCash asked if Dublin would actually hire an entry-level attorney for this type of work. Mr. Kranstuber stated that for a City prosecutor for the City of Columbus, staff attorney with the Attorney General's office, hearing officer for the Industrial Commission -comparing government to government-the positions would be paid in the mid-30,000 range. Finance Committee of the Whole March 25, 2002 Page 5 Mayor McCash stated that if the services were brought in-house, would quality suffer by bringing in an entry-level attorney? It seems that a more experienced City attorney at $55,000 would be more qualified for this type of work. Ms. Chinnici-Zuercher stated more research can be done on the true government salary rates paid, but the other consideration is that most of these people don't remain in these offices because of the low salaries. They may gain good experience and training, but there is a lot of turnover. Unlike many government jobs, Dublin requires more night meetings and long hours. Mr. Lecklider stated that in some cases that is true, but in some areas, such as Public Defenders or the Court of Claims, staff works on nights and weekends. Discussion continued. Mr. Lecklider asked about the Mayor's Court area-there was some controversy a couple of years ago about whether cities should be in the business of Mayor's Courts. Ms. Readler noted that there was a recent case where a City received a substantial portion of its revenue from the Mayor's Court. It was presided over by the Mayor who was not an attorney and who was also the Administrator of the City. The basis was that the Mayor could be biased toward the City, as the revenues brought in comprised a major portion of that City's budget. In Dublin's case, this does not apply as the City Manager is the executive head of staff, and the City receives small portion of its revenues from Mayor's Court. Mr. Smith added that another reason Dublin continues to have Mayor's Court is as a service to the residents. Dublin residents would have to travel downtown to have their cases heard if the Dublin Mayor's Court was not available to them. He is not certain what type of revenues are brought in from Mayor's Court versus the administrative costs for operation. Ms. Grigsby stated that the costs exceed the revenues brought in. Mr. Lecklider asked for further details. Mr. Kranstuber stated that in consideration of the staffing and overhead costs, this is not a revenue producing function. Mr. Smith stated that Dublin's Mayor Court is a very well run, well-equipped operation compared to other Municipal Courts. He added that a lot of education is now required for Mayor's Court presiders compared to ten years ago. Mayor's Court is not a profitable service for the Law Department in terms of the fees versus the time allocated to this service. He believes that the Dublin Police would endorse having a Mayor's Court in Dublin because if cases were sent downtown, Dublin Police would be required to attend those hearings, resulting in more overtime costs and travel time for police. The Mayor's Court is in keeping with the community oriented policing program under which Dublin operates. Finance Committee of the Whole March 25, 2002 Page 6 Ms. Chinnici-Zuercher noted that this service is provided to those who have violated the law. As Dublin increases in population, is this a service which should be provided to residents, and is it cost effective? She would be curious to see the kind of cases reviewed in Dublin's Mayor's Court -are they mostly traffic? Mayor McCash responded that most are traffic violations, OMVI, drug paraphernalia, driving without license. The fine rates are established in the cost of services study, and Council has not by policy recouped the costs at 100 percent for the Mayor's Court. Costs are not recouped for rec center services either. Ms. Chinnici-Zuercher asked why the City should not recover 100 percent of the costs when someone has violated the law? Mayor McCash stated that this has been debated in the past -whether the recovery for these services should be at 50 or 100 percent? Ms. Grigsby stated that the costs for the diversion program have been debated every year as part of the cost study. The costs for the program continue to rise, and Finance staff has recommended increasing the costs. The Courts staff has been opposed to increase of this cost. Finance staff believes that the benefit of the diversion program to the offender is in not having a record, and there should be an appropriate cost for that program allocated to the offender. The City probably subsidizes this service 50 percent. Ms. Chinnici-Zuercher stated that there is a benefit to the diversion program in the defendant not having a record, and it is appalling that the City is subsidizing this at 50 percent. Mayor McCash stated that the other factor is that if someone is jailed downtown, the cost to the City is $70 per day to house those prisoners versus having them do community service or pay a higher fine. Mr. Smith noted that the police officers would have to spend hours downtown waiting for cases to be heard. Ms. Chinnici-Zuercher stated that, nonetheless, Dublin could still recoup more of the costs for the Mayor's Court services. In response to Mr. Smith, Mr. Kranstuber estimated that approximately 20-25 percent of the cases in Mayor's Court are those of Dublin residents. Many of the cases relate to people who work in or around Dublin. Mr. Kranstuber stated that in terms of in-house legal staff, it was noted that there is often a lot of turnover for those in state agencies or city attorney offices making in the $30,000 range. He does not believe this is true -many stay in state or city government for a variety of reasons. His experience, however, as Mayor showed that in terms of legal services at Mayor's Court, there was a lot of turnover in legal staff in the six years he presided. This level of turnover would likely be no different with in-house legal staff. Finance Committee of the Whole March 25, 2002 Page 7 Mayor McCash stated it is not necessary to have a highly experienced attorney to handle Mayor's Court, most of which are routine matters. He added that it is natural to have turnover to less experienced attorneys as more experienced attorneys command a higher billing rate. Ms. Chinnici-Zuercher pointed out that she believes that the salaries paid to attorneys at the state or county level are higher than what has been indicated. Mr. Kranstuber asked Mr. Smith for his estimate of a typical starting salary for a city attorney. Mr. Smith responded that he would estimate $35,000. Ms. Grigsby stated that the range for the Columbus City attorneys is $33,500 to $54,500. For Upper Arlington, an Assistant City Attorney is paid $72,000 which is at the higher end. The majority of staff attorneys at Columbus range from $35,000 to $60,300. Mr. Kranstuber stated that he is not saying Dublin should pay these salaries, but he wants to know the basis for the salaries listed in the memo. When he reviews ads for attorneys in various legal publications, the salary ranges are $35-48,000. Dublin may decide that the market is $34,000 and Dublin wants to pay $54,000. What he is questioning is the accuracy of a mid-range for an entry- level attorney at $67,000 as outlined in the memo. Ms. Chinnici-Zuercher suggested that he obtain this salary information from the Columbus Bar Association or Ohio State Bar Association. Ms. Grigsby has indicated that these estimates were based on the pay ranges existing in Dublin and the level of responsibilities the positions would have. Council is aware that the salaries in Dublin are competitive in the marketplace. Mr. Kranstuber stated that it is also important to be responsible. He believes a job in a safe community such as Dublin with PERS benefits would attract many applicants in the $30,000 range. Mayor McCash stated that from an attorney's standpoint, what type of candidate does a $33,000 salary attract? Mr. Lecklider stated that they are in the process of hiring someone at Ohio University currently. The applicant has worked for a major law firm for five years and graduated second in the law class. They are willing to take a huge pay cut, and there is a reason: they find it attractive to work in public service. Mayor McCash noted that the $30,000 salary level would somewhat narrow the field to lesser quality candidates who want to cut back their hours by working in government service. At $50,000, you would get more of the better quality candidates in the available pool. Mr. Kranstuber stated that he is not endorsing paying $35,000. For staffs benefit, they should know that the estimates are really out of line. He does not know where the estimates came from. If Dublin wants to pay more for higher quality, that is fine - but he wants the information to be accurate at the outset. He added that there are a variety of reasons for which people choose to work in the public sector. Finance Committee of the Whole March 25, 2002 Page 8 Mr. Lecklider stated that they hire 10 to 20 attorneys each year in the Attorney General's office for lower salaries than these and the applicants have exceptional qualifications. Ms. Chinnici-Zuercher stated that in addition to obtaining further information on salary surveys, another issue for consideration in a change to an in-house counsel is what are the benchmarks you begin to assess as to when it becomes totally cost effective to have in-house counsel Is it sensible for a growth City to do this, or must an extraordinary amount of work be outsourced in any case to keep up with the demands? Mr. Kranstuber stated that if an assumption were made that a person would be productive for 40 hours a week, 2080 hours a year, at $100 per hour, that is $208,000. Taking that amount, minus the amount the staff attorney is being paid, would be the benefit. Any work being done in house would not have to be outsourced. Mayor McCash asked if staff has information regarding the Law Department budget for Upper Arlington, in addition to the salaries. Can information be compiled about comparable sized cities' law departments? Ms. Grigsby responded that the Law Department budget in Upper Arlington is $580,000. Ms. Chinnici-Zuercher stated that it would be important to have comparable cities in terms of development, growth, land acquisition, projects. Upper Arlington would not be a good comparison. Mr. McCash agreed that based on this, Dublin would probably be looking at a budget of $750,000 or so. Ms. Grigsby stated that in looking at Dublin's general billing for legal services, this would be a number for comparison with Arlington. Dublin's budget for general services in 2000 was $572,000; in 2001, it was $793,000. From the standpoint of tax collection, Dublin is more aggressive than Arlington, so removing the $57,000 for tax collection brings Dublin's figure down to $740,000 compared to their $580,000. Mayor McCash asked what Worthington spends on legal fees. Ms. Grigsby responded that this figure is $368,000. Mr. Lecklider asked which suburbs have Mayor's Courts. Mr. Smith responded that all of the Central Ohio suburbs have Mayor's Courts. Some are presided over by magistrates in a case where the Mayor is the Chief Executive Officer of the City. There is a two-fold reason: 1) the cost of sending the police officers downtown; and 2) the Franklin County Municipal Court system, as presently configured, could not handle any more volume. To his knowledge, there has been no movement to eliminate Mayor's Court in Dublin; the Police division would likely want to have input in any such consideration involving diversion, community oriented policing, etc. Ms. Chinnici-Zuercher summarized that there are three things that require follow-up: the salary survey information from CBA and OSBA (Mr. Kranstuber asked that staff obtain these); the Finance Committee of the Whole March 25, 2002 Page 9 activities which could be performed by staff- what those are and how many hours per year that would require; and at the Mayor's Court, at the very least, looking at raising the fee structure to at least cover the costs of Mayor's Court. Mr. Kranstuber asked if staff's comments about cost recovery include costs for traffic tickets and whether those are subsidized as well. Ms. Grigsby responded that when you look at the overall fines collected compared to the cost to provide the overall service, the service is subsidized by the City. Mr. Kranstuber stated that these are two separate issues. In terms of the diversion program, the true cost of which is $250-300, and if the total cost is assessed to the offender, no one will use the program. Instead of paying a fine or restitution and having a record of this violation, a juvenile can choose diversion -leaving no record and having the case dismissed at the end of the diversion program. For the fine, the defendant doesn't care if it is fine or costs -but there is a point at which the fine could become unreasonable. Mayor McCash stated that if someone receives a $70 ticket and pays at the window, there are no costs added. If they come to Mayor's Court, there are costs of $20 to the state and other costs incurred. Mr. Kranstuber stated that he never penalized people by charging them more for coming into plead their case. Mr. Smith added that Dublin cannot raise the fee charged by the state. Dublin could raise the costs for Mayor's Court, but then the question becomes should they be punished for coming in. Ms. Chinnici-Zuercher stated that it is important to understand what the costs of Mayor's Court are and then decide if this is a benefit that the City wants to provide to the citizens and to subsidize its cost. There is a need to truly understand the total cost being written off for somewhat of a convenience issue for those who made a decision to break the law. Mr. Smith noted that from a police standpoint, if Mayor's Court is eliminated, an officer must attend court downtown. He would guess that the FOP would object. Ms. Chinnici-Zuercher stated that the discussion on the table is about the level of fines -not the existence of Mayor's Court. Mayor McCash stated that it is a cost of services issue - perhaps a speeding ticket fine should be raised to help cover the costs. If someone decides to come to Mayor's Court instead of paying the fine, it is the Mayor's discretion as to whether to charge court costs. Twenty dollars is added by the state for court costs. He understands that if a fine is paid at the window, there are no state costs assessed as there are in Mayor's Court. Mr. Smith stated that there are some statistics available about Mayor's Court operations which were done in follow-up to the case previously discussed. He can provide this to Council. Finance Committee of the Whole March 25, 2002 Page 10 Mayor McCash noted that overtime paid to police might offset any costs saved in eliminating Mayor's Court. It may also preclude some officers from writing tickets, as they will have to travel downtown to appear in court in follow-up. What then becomes the threshold for issuing a ticket? Mr. Smith noted that for those who arrived late, he had previously proposed changing to an 18- month contract in view of the interim manager and transition anticipated. Longterm, they may consider proposing a contract attorney to be on site or sharing a person in-house. Mayor McCash stated that there is a monthly stipend for Mayor's Court, but what is the fee arrangement for Council meetings. Mr. Smith responded that the fees are hourly, not on a per meeting basis for Council meetings. Mayor McCash asked if there would be a savings to the City with a per meeting stipend. Mr. Smith stated that in view of the volume of meetings, the special meetings and the unpredictability in the duration of meetings, he would not be willing to establish a stipend per meeting. Mayor McCash suggested that perhaps for the two regular meetings per month, a flat fee could be established based on four hours per meeting as an average. For a special meeting, it could be charged on an hourly basis. Mr. Smith responded that he could review their computer base to obtain more information on this, but he could not have this prepared in time for review in conjunction with this contract. He would prefer to have an in-house person handling Mayor's Court as it is very time consuming and requires an inordinate amount of staff time for good customer service. The former manager's policy was to have adequate staffing to ensure an efficient operation, but if Council prefers, this can be revisited. The flat fee for Mayor's Court was agreed upon two years ago at $72,000, and he is requesting an increase to $7,500 per month or $90,000 per year. Currently, they write off approximately $25,000 per year for Mayor's Court services. Mayor McCash stated that the flat fee was based on assigning one prosecutor. Currently, there are two to three prosecutors. Mr. Smith responded that if there is a large caseload, three are sent out, and one is sent home after the pretrials are concluded. They can certainly assign one prosecutor instead. Mayor McCash stated that the prosecutors work very hard and work long hours already to handle the caseload. Mr. Kranstuber stated that this particular position would be hard to have staffed with an in-house person, as the work is concentrated during Mayor's Court days. Mr. Smith responded that perhaps apart-time contract person could be assigned. Mr. Smith asked if there is any issue with their service delivery in terms of response time, etc. There were no issues voiced. Finance Committee of the Whole March 25, 2002 Page 11 Mr. Smith added that they will continue to work with the Interim City Manager on formulating a better system for handling items such as land acquisition and identifying other matters which could be handled by administrative staff. Ms. Chinnici-Zuercher moved to adjourn to executive session for discussion of the employment contract for the Law Director. Mr. Kranstuber seconded the motion. Vote on the motion - Mr. Lecklider, yes; Mr. Kranstuber, yes; Ms. Chinnici-Zuercher, yes; Mayor McCash, yes. The meeting was adjourned to executive session at 8:30 p.m. Ms. Chinnici-Zuercher noted thatthe meeting would not be reconvened following the executive session. Clerk of Council