West Chester Borough Manager’s Report 2012

MEMORANDUM

TO: Borough Council

Mayor Comitta

FROM: Ernie B. McNeely, Borough Manager

DATE: January 6, 2012

CC: Department Heads

RE: Manager’s Report

1. Accomplishments 2011

It is common at this point in the new year to look back at accomplishments in the prior year and then look forward to objectives for the new year. The following are items completed or accomplished in 2011:

 Completed design and opened bids for the Public Works Facility Expansion Project. Completed design and opened bids for the Police Facility Expansion Project. Completed final design and hopefully all PennDOT reviews of the $1.4 million Church Street Streetscape Project The project is awaiting PennDOT authorization to move to the bidding phase. Re-analyzed and adjusted the annual rental license fee prior to the permit mailing date in May as was agreed with the landlord group several years ago. Completed construction of the state grant funded Bicentennial Garage LED Lighting Project that has cut electric consumption at the facility in half. Used left over grant funds from the Bicentennial Garage Project to complete an additional grant funded project to install a number of LED lights in the Municipal Building. Advocated for legislation to provide the Borough with new reasonable revenue sources such as an alcohol tax and or some type of sales related tax that tracks increased business activity and mirrors increased demand for municipal services. Approved a plan for re-apportionment of the voting wards following release of the 2010 Census information. Secured the final grant balance payment of $112,052 from the $1.0 million state funded RACP grant for the Chestnut Street Garage Project. Awarded bids for the solar system installation on the roof of the Chestnut Street Garage.

 Approved execution of a Memorandum of Understanding with West Chester University for operation of a PEG (Public, Educational, Governmental) channel on the Verizon cable network. Authorized the Solicitor to file under the Blighted Properties Act to have the Borough appointed as conservator to remediate the condition at 119 S. Matlack Street which has culminated in a judicial sale of the deteriorated property to an investor who will renovate the home. Authorized the Code Official to act under the Property Maintenance Code and completed action to demolish 110-112 S. Matlack Street to remove a blighted fire damaged property. Added a late payment warning letter and $10 late fee prior to citation for unpaid parking tickets which reduces cost to the recipient and reduces the number of such tickets that go to citation. Implemented a Borough operated local violation warrant processing system as a result of an unfunded mandate from the Chester County Court system. Completed the $249,133 Community Revitalization grant funded W. Market Street Storm & Sanitary Sewer Project. Refinanced the Series 2003 University Parking Garages debt to generate savings and obtained West Chester University consent to use a portion of the savings to reconstruct Church Street through the campus. Completed and adopted the West Chester Historic Preservation Plan prepared by Ray Ott& Associates. Create a Borough Financial Advisory Ad-Hoc Committee to make recommendations for future Borough finances. Ordered fire equipment through the state cooperative purchasing contract COSTARS including an Air – Light Truck - $494,888 and Ladder Truck -$996,658 to be delivered in 2012. Used leftover grant funds from the West Market Street Storm Sewer Rehabilitation project to mill and overlay Wayne Street - Wollerton Alley to Washington Street, Wollerton Alley – Potter Alley to Wayne Street and W. Market Street – New Street to Wayne Street. Restarted the contract with The Harman Group to complete the design and construction phase services for the New Street Parking Garage Project after the project was on hold for several years while appeals were decided. Accepted a proposal from PLGIT (Pennsylvania Local Government Investment Trust) to add the ability to pay parking fines and fees plus other types of Borough payments with credit cards. Amended Chapter 36 Alcoholic Beverages and Chapter 90 Public Indecency to increase minimum fines to $100. Reviewed proposals for Banking Services and Pension Fund Custodial Services ultimately awarding both to Susquehanna Bank. Adopted a 2012 Budget for all funds maintaining the tax rate the same as in 2011.

2. 2012 Objectives – This year presents a number of major challenges for Borough Council including a probable Pfizer legal challenge to their sewer agreement which represents an $800,000 per year risk for the Borough plus the need to renegotiate major union and service contracts.

 Work with the Borough Solicitor to defend the terms of the Pfizer property sewer agreement which produces $800,000 per year in revenue and/or negotiate terms acceptable to the Borough to resolve the sewer agreement with Pfizer. Outright loss of the agreement funding would require over a 20 percent sewer rate increase to mitigate. Negotiate a new collective bargaining agreement with the Brotherhood of West Chester Police to be effective 1-1-2013 that brings some relief to the Borough costs for benefits and wages. Negotiate a new collective bargaining agreement with the AFSCME union to be effective 1-1-2013 that brings some relief to the Borough cost for benefits and wages. Negotiate a new police services agreement with East Bradford Township to be effective 1-1-2013. Determine whether to award bids and proceed with the Police Department Expansion Project. Determine whether to award bids and proceed with the Public Works Department Facility Replacement Project. Review and evaluate the Ad-hoc Citizens Financial Advisory Committee Report due by March 31st and consider long term options for dealing with the financial challenges the Borough faces. Convince PennDOT to award bids and implement the $1.4 million Church Street Streetscape Project which will make improvements between Chestnut Street and Miner Street. Continue to work with the Community-Campus Coalition (CCC) plus the Borough-University Officials Group (BUOG) on strategies to improve quality of life issues and Borough-University cooperation. Continue evaluation of new technology that would allow payment of parking meters by cell phone plus other customer service enhancements. Evaluate options, plan and implement a replacement for the 21 year old Municipal Building HVAC system. Implement the approved PLGIT system for allowing customers to pay for parking fines, fees and other Borough charges using credit cards. Begin planning to conduct a new comprehensive planning study that would include a traditional comprehensive plan, a strategic planning component and potentially a climate action/sustainability plan. Continue to pursue legislative support for the recommendations found in the PLCM Core Communities in Crisis Study. Continue to lobby and pursue legislation to provide the Borough with new reasonable revenue sources such as an alcohol tax and or some type of sales related tax that tracks increased business activity and mirrors increased demand for municipal services.

 Coordinate with PennDOT’s planned project for repairing East Gay and East Market Streets both of which are in deplorable condition. The project is currently scheduled to start in March. Again review the rental license fee to determine where it should be set for 2012-2013. Work with West Chester University to implement the PEG channel and hopefully convince Comcast to add the station to their cable channel line-up. Other objectives as Borough Council may define.

3. Police Department and Public Works Department Building Projects

A most immediate need for Borough Council is to decide whether to proceed with both or either of these building infrastructure improvement/replacement projects. Bids on the Public Works Facility Replacement Project were opened November 3, 2011 and are good for 90 days which will expire February 1, 2012. The low bid for the project was submitted by Gordan H. Baver for $3,749,000 which is 3.9% over the architect’s high end estimate of $3,607,740 but substantially above the $3.3 million target budget. If Council intends to do the project options could include award the bid, request an extension of the bid time to allow further evaluation, rebid to try to obtain better pricing and/or revise the design to lower costs.

Bids on the Police Department Expansion Project were opened November 17, 2011 and are good for 90 days which will expire February 15, 2012 which is the February Council meeting date. The low bid for the project was submitted by Titanium Enterprises for $3,017,306 which is well below the architect’s low end estimate of $3.3 million and substantially below the $3.3 million target budget. While the low bidder evaluation is not yet complete if Council intends to do the project it is unlikely more favorable pricing could be obtained by rebidding. Even if the low bidder is found to be unqualified the second low bid is S.B. Conrad at $3,360,000 right on budget.

The primary issue is for Council to decide if either project is going to be implemented. Certainly financing and construction cost rates are at historic lows in the current economy. The combined low bids would total $6,766,366 and adding at least $300,000 for contingencies the amount needed to finance would total $7,066,000 plus issuance costs. At the current low interest rates that amount could be financed with a long term bond issue and wrapped around the current Borough General Fund debt most of which is expiring in 2014-2015 so that the Borough’s current level of annual debt service payments would stay the same at around $714,000 per year. That said Borough Council is already committed to incurring another $1.2 million in debt for the $1.6 million of two fire trucks ordered for delivery in 2012 so there will be some increase in debt service to meet that need. If the two building projects are financed as explained the Borough would not then realize substantial debt service payment relief in 2014 – 2015.

The important thing is for Council to weigh the need for the two building infrastructure projects against the impact on future finances and decide if either project is to go forward.

There is no sense wasting additional dollars to rebid the Public Works Project if regardless of pricing Council does not intend to go forward. Borough Council has committed approximately $400,000 in design costs to get these projects to this stage and it is time to decide if either is to proceed. I would encourage our new Council members to meet with the Police Chief and Public Works Director to gain a full understanding of what each project will do and the need of the department. I will have to include the Public Works Facility Replacement Project bids on the January 17-18 agenda for some type of Council decision on what to do with those bids.

4. Chestnut Street Garage Solar Project

This project is nearing completion and should be fully closed out by the end of March. With the current depressed market for SREC credits the project cannot be projected to hit the anticipated payback of approximately 13 years. However both the future market for renewable energy credits could improve and future electric cost escalation could be worse than projected and allow the project to hit payback projections. It is a commitment by the Borough towards a sustainable future and we should plan a dedication ceremony to celebrate the project after it is complete. That might better wait till later in the Spring as it can be very cold and windy on top of the garage.