WRIGHT COUNTY BOARD MINUTES
OCTOBER 22, 2013
The Wright County Board met in regular session at 9:00 A.M. with Husom, Sawatzke, Daleiden, Potter and Borrell present.
Husom moved to approve the 10-15-13 County Board Minutes as presented. The motion was seconded by Daleiden and carried unanimously.
Daleiden moved to approve the Agenda as presented, seconded by Potter, carried 5-0.
On a motion by Daleiden, second by Potter, all voted to approve the Consent Agenda:
1. Performance Appraisals: T. Erickson, Atty.; W. Cordell, D. Demarais, Hwy.; T. Halberg, R. Salls, G. Sandin, S. Sims, R. Smith, C. Stine, Sher./Corr.
2. Approve Charitable Gambling Application Form LG240B, Dassel-Cokato Wrestling Club, DC MS Commons, 4852 Reardon Ave. SW, Cokato, MN, 55321 (Cokato Twp.).
3. Authorize Signatures On 2014 County Agricultural Inspector Contract With Eric Heuring.
4. Schedule Closed Session For 11-05-13 @ 10:30 A.M. RE: Labor Negotiation Strategies.
5. Accept Resignation Of Jay Kieft, Human Services Director, Eff. 11-15-13 & Authorize Replacement.
B. HUMAN SERVICES
1. Position Replacement:
a. 1.0 FTE Social Worker, Adult Services/Vulnerable Adult Investigator.
Capt. Pat O’Malley, Jail Administrator, stated that Allina has decided not to renew the contract held with Wright County to provide medical services for the Jail, beginning 1-01-14. Four providers were consulted. O’Malley’s recommendation is to enter into a three-year contract with MEnD Correctional Care, LLC, Waite Park, Minnesota. The contract rate is $217,600 with a 2% increase per year. The current contract rate with Allina is $240,467. The contract with Allina has realized a 17% increase over the past three years.
O’Malley stated Dr. Todd Leonard is the owner and founder of MEnD. MEnD is providing services to eleven jails in Minnesota. Dr. Leonard’s focus is on jails and specifically jails in Minnesota. The contract with Wright County would provide services for doctor, nurse, health technician, and mental health. There is a psychologist on MEnD’s payroll. MEnD can provide pre-employment physicals if the scheduling works. Dr. Leonard was hired by Sherburne County to assist with their setup, and started his own company thereafter. O’Malley said Dr. Leonard comes highly recommended.
Daleiden asked what hospital(s) will be used and whether associated costs will increase. O’Malley does not feel costs will increase. The Wright County Jail will continue to use a variety of medical facilities. Inmates are typically brought to Allina Hospital, and he does not foresee that changing. He plans on checking with Centra Care in Monticello as well. O’Malley said the County is billed for inmate care using the MA (Medical Assistance) rate. There is a process that must be followed when applying for that rate. It does not matter which facility is used as the MA rate is the same throughout. O’Malley said medical billings for inmates are reviewed thoroughly by the Jail staff and nursing staff, and it is a complicated and time-consuming process. Husom asked about the change in MA laws. O’Malley said that MA will not pay while an inmate is in custody. Payment is only made if the inmate is admitted to a hospital. He understands that the inmate must have been receiving MA prior to being brought into custody. Private insurance is billed for inmates where applicable. The pharmacy assists the Jail by accessing a database to help determine whether an inmate has health insurance.
Borrell made a motion to approve and authorize signatures on the Jail Medical Contract with MEnD Correctional Care for a three-year period at a rate of $217,600 with a 2% increase each year. The motion was seconded by Daleiden and carried 5-0.
Tammy Bigelow, Human Resources Director, asked the Board to allow department heads to hire a candidate up to Step 3 of the applicable pay grade in consultation with the Human Resources Director. Prior to the downturn in the economy, department heads were able to hire a candidate up to Step 3 depending on the candidate’s qualification and the candidate pool. In 2009, the decision was made to hire all candidates at Step 1 to assist in balancing the budget. Sawatzke said if the Human Resources Director feels a request is not justified, the department head will need to request approval from the Board. He said the change would apply to those positions where it is hard to hire at Step 1 or the candidate possesses unbelievable qualifications. Sawatzke said the criteria need to be consistent amongst departments. Bigelow said this is understood but asked the Board to recognize that every recruitment and candidate pool is different. It was the consensus that the language of the recommendation should include “with the approval of the Human Resources Director.” Potter moved to allow department heads to hire a candidate up to Step 3 of applicable pay grade with the approval of the Human Resources Director. The motion was seconded by Borrell and carried 5-0.
Bigelow presented suggested revisions to the Wright County Personnel Policy relating to the use of e-cigarette products. Lee Kelly, Interim County Coordinator, said the language revisions were done in consultation other jurisdictions and with Brian Asleson, Chief Deputy Attorney, and Joel Torkelson, Wright County Public Health. On a motion by Potter, second by Husom, all voted to approve the following changes to the Wright County Personnel Policy, Section 502, Smoking:
Add second paragraph to Section 502.01, Policy Statement:
For the purpose of this policy, “smoking and tobacco use” means inhaling or exhaling from any lighted cigar, cigarette, pipe or any other lighted tobacco, plant product, or substance that may be used for smoking in lieu of tobacco intended for inhalation via any of the means listed above. Use of electronic devices, which simulate smoking or facilitate vaping are also prohibited. This includes, but is not limited to, electronic or “e” devices such as e-cigarettes, e-cigars, e-pipes. Electronic devices are prohibited regardless of whether they provide vapor of liquid nicotine, lobelia, and/or other substances. Non-electronic devices, which simulate smoking are also prohibited.
Revise Section 502.03, Outdoor Smoking Locations, revising Item 5 and adding Item 6:
5. Human Services Center - east door designated area at the rear of the building.
6. Jail/LEC designated smoking areas near the north employee entrance and south of the front entrance.
(End of revisions to Wright County Personnel Policy, Section 502, Smoking)
Steve Jobe, Surveyor, requested approval to prepare RFP’s (Request For Proposals) for 2014 aerial photography together with Sherburne and Stearns Counties. This was discussed as part of the 2014 Budget process. Jobe anticipates a cost savings, as this is a large project and the photography will overlap adjoining counties. He estimated savings of mobilization costs at approximately $8,000 collectively. Funding for the $75,000 cost of the aerial photography will be from the Recorders Compliance Fund. Jobe said County departments utilize the photography and it is used as a base for the Beacon product that services the public. Aerial photography is done on a three-year cycle (2005, 2008, and 2011). Jobe said Planning & Zoning utilizes the photography often for questions relating to shoreland, etc. When the photography becomes outdated, more field visits are required.
Borrell asked whether a product such as Google Earth could replace aerial photography at some point. Jobe said there are many aerial photography products. It comes down to scale and pixel resolution. The Google Earth product becomes grainy fast. In government applications, a closer shot is preferred. Sawatzke asked Jobe how much he envisions saving between mobilization and the economy of scale aspect. Jobe suggested obtaining proposals as he is unsure of the savings. He estimated an additional 10% savings. Sawatzke asked whether Stearns and Sherburne Counties will go forward with the project regardless of whether Wright County does. Jobe believes this to be the case. One RFP will be used for the three counties, and proposals will be reviewed by each of the counties. Jobe said this RFP will include a 6”, 4”, and 3” pixel resolution. He anticipates there may be separate contracts for each county. One figure will be bid and the cost will be separated based on the square miles of each county. Sawatzke asked whether a county can opt out. Jobe said they have not discussed this but the RFP could include this option. Husom asked whether Jobe anticipates a large savings in staff time due to the aerial photography being completed. Jobe said the County has already realized that savings as the aerial photography has been in place for some time. Borrell asked whether Jobe has been in contact with companies to make sure there is an economy of scale in completing the project with the two other counties. Jobe said he spoke with two vendors and they are interested because of the cost savings.
Potter moved to authorize Jobe to proceed with development and distribution of an RFP for aerial photography with Sherburne and Stearns Counties. Specifications should include alternate bids with or without Wright County. In that way, the County Board can see the cost before proceeding to the next step. The motion was seconded by Husom and carried 5-0.
Virgil Hawkins, Highway Engineer, requested the Board schedule a Transportation Committee Of The Whole (TCOTW) Meeting with the following Agenda items: 1) Feedback on Cost Participation Policy; 2) Projects Update; 3) RFP for Public Works Shop; 4) CR 147 Turnback; 5) CSAH 37/70th Street Agreement with Otsego/Albertville/St. Michael; 6) Region 7W Urbanized Area MOU Status; and 7) Candidate Projects for 2018 Federal Funding Solicitation. Daleiden referenced Item 1, Feedback on Cost Participation Policy, and said there are municipalities that are interested in being part of this discussion. He asked whether that item should be scheduled at a different time. Hawkins said at the TCOTW Meeting, it is the intent to discuss the feedback received from the eight cities and two townships that have responded. A date could be set at that time for a public meeting where municipalities would be invited to provide feedback. Sawatzke asked if another meeting is required based on the feedback received. Hawkins said that the cities indicated they would like that opportunity. Potter said the cities he represents have asked to participate in the feedback. Potter moved to schedule a TCOTW meeting on
11-19-13 at 1:00 P.M. The meeting will be held at the Public Works Building. The motion carried 5-0 on a second by Daleiden.
Hawkins requested approval to renew a Maintenance Agreement with Hennepin County for three shared bridges (No. 27554, 27641, and 27532) through December 31, 2018. Daleiden moved to approve the renewal of the Maintenance Agreement with Hennepin County, seconded by Potter, carried 5-0. After the motion was passed, Kelly said the paperwork reflects a resolution is required. Daleiden moved to adopt Resolution #13-38, seconded by Borrell, carried 5-0 on a roll call vote.
Hawkins presented a draft resolution for final acceptance of the 2013 Lighting Project, SP 086-070-008, Contract #13-04, with Design Electric of St. Cloud, Minnesota and to authorize final payment of $7,600.00. The final value of the work certified is $152,000.00. Sawatzke asked if electrical cost savings have been realized. Hawkins said a reduction has been seen from $30/month to $8/month or a savings of $270/year. Sawatzke suggested motion detectors for these rural intersection areas. Borrell suggested researching the cost of replacing the lights with LED’s. Hawkins said these are things that can be investigated. Currently, high pressure sodium bulbs are being used which last 3-5 years. He was unsure whether it would be better to replace them all or to look at doing so dependent on the age of the system. The initial costs to move toward LED are higher but that cost can be recouped in a year or less. Borrell moved to adopt Resolution #13-39, for final acceptance of the 2013 Lighting Project with Design Electric of St. Cloud, Minnesota and authorizing final payment of $7,600.00. The motion was seconded by Daleiden and carried 5-0 on a roll call vote.
Bob Hiivala, Auditor/Treasurer, introduced Jacqueline Schmidt who was recently hired as the Elections Supervisor. The County Board welcomed Schmidt.
Hiivala brought forth discussion on County Ditch 10. At the last County Board Meeting, Bryce Cruey from Wenck Associates opened bids for repair work. Discussion involved the removal of debris by the contractor. Today, Hiivala provided a copy of an email from Blackstone Contractors who was selected as the low bidder on the project. The email reflects the following,
“Blackstone will accomplish the Clearing and Grubbing and Tree removal by the following methods. The small brush that is to be cleared one rod from the centerline will be ground and mulched in place. The larger trees will be cut into logs and hauled to our employees homes for firewood to heat their homes. The brush and branches will be ground and mulched. There will be no material that is deposited on adjacent lands.”
Sawatzke said the email satisfies the concerns of the Board. Based on the response, the contractor is not interested in burning on site. Daleiden asked whether there is a problem with leaving the mulch on site. Borrell said it is good for stabilization of the ditch if spread. Sawatzke said the contractor may elect to haul the mulch away. Hiivala is unsure whether the contract includes seeding requirements. Daleiden said it should be clarified in the contract that there is seeding involved for erosion control. Hiivala will ask Wenck Associates if erosion control was addressed and that this should be specified in the contract. This was provided as an informational update.
Hiivala said one resume was received from Jeffrey Golden of Annandale for the Clearwater River Watershed District appointment. After review of the application by Board members, Borrell moved to appoint Jeffrey Golden to the Clearwater River Watershed District Board fulfilling the remainder of Mark Kampa’s term, which expires August 13, 2015. The motion was seconded by Potter and carried 5-0.
The claims listing was reviewed. The following claims were referenced:
• Potter referenced a claim on Page 13, Joes Machinery Company ($8,211.00), for a new radial arm saw and table for the Parks Department. Hiivala said the invoice reflects it is for a 16” radial arm saw and accessories. Sawatzke said the Parks Department needs decent equipment to maintain the 30 parks. Daleiden added that the equipment must meet OSHA standards.
• Husom questioned a claim on page 13, Clearwater River Watershed District ($2,289.73), charged to Repairs & Maintenance. Hiivala explained this involves an annual assessment levied against Park land by the Watershed District for such things as a grass bog, milfoil, and operating expenses. Daleiden questioned the funding source. Hiivala responded that the Parks Department budgets for this item under Repairs & Maintenance. Hiivala will propose at a future date to have a line item for special assessments or tax payments.
• Daleiden referenced a claim on Page 11, Schedule Soft ($3,260.00), coded to Professional Services in the Sheriff’s Department. Lt. Todd Hoffman stated the claim is for scheduling software used to prepare work schedules of deputies, corrections officers, and dispatch employees.
On a motion by Borrell, second by Potter, all voted to approve the claims as listed in the abstract, subject to audit, in the amount of $404,678.87, with 149 vendors and 268 transactions.
A Committee Of The Whole Meeting was held on 10-15-13. At today’s County Board Meeting, Potter moved to accept the minutes as accurate. The motion was seconded by Daleiden and carried 5-0:
I. Maximus Presentation of Indirect Cost Report
Hiivala introduced Blaschko and Vermeulen, who were present to review the Indirect Cost Report and explain the report preparation process and contents. Blaschko told him she has been working for MAXIMUS for 27 years. Vermeulen is in his third year with the company. MAXIMUS has prepared indirect cost plans in Minnesota for 30 years.
Blaschko said an indirect cost plan is a way for the County to recover some of the costs to support federal programs based on the requirements stated in the OMB (Office of Management and Budget) A-87 circular entitled, “Cost Principles For State And Local Governments.” The federal government tells local governments that if they identify expenditures related to supporting federal programs, the federal government will pay a proportionate share.
Blaschko directed attention to a PowerPoint presentation, Page 2, “Key Components Of Cost Plan” (see attached). First, Blaschko said they study County financial information from the General Fund. Then they identify which departments support other County departments that service federal programs.
Next, Blaschko said they review the organization of the County. For example, some counties have payroll done through a Human Resources functions. Others perform it through the Auditor’s office. MAXIMUS follows directives from the OMB A-87 and looks for reimbursable activities. Blaschko and her colleagues examine the department and its employees and break down their salaries to determine how much each activity costs the County.
The next step is to study allocation statistics to determine the best way to allocate these costs. The federal government is looking for objective statistics such as payroll checks, number of full time equivalent employees (FTEs), square footage, the number of computers, etc. Finally, Blaschko said they review best practices set forth by the OMB A-87.
Referring to Page 3, “Developing the Plan,” Blaschko said they create the Cost Allocation Plan (CAP) by identifying departments with reimbursable costs or activities, using the Personal Activity Reports (PAR), and following OMB A-87 guidelines. One of the hallmarks of the MAXIMUS method is to reconcile all costs in the General Fund to make sure none are counted twice. They also identify methods of measuring benefits of activities to make sure they are not unfairly choosing a department. They also define legislative functions. For example, Election functions or County Commissioners are not allocable functions, because they operate regardless of whether there is a Social Services function. Legislative functions are not an allocable expense.
MAXIMUS representatives seek to understand the structure of the County and look for anomalies and changes, while following guidelines stated in the OMB A-87. Blaschko said a current example is their observation that metal detectors were moved to the Court Administration area. She said this will change the way they allocate security functions. She added that it may be beneficial for the County because more of the allocable expense can be spread over the IV-D area since the metal detectors are not being used for all County departments. Blaschko said they look at buildings as part of their study.
Blaschko referred to Page 4, “Steps In Producing Plan.” They gather the County financial information, generate the PARs which each person signs and certifies, compile the allocation statistics, and seek to understand the County structure and any anomalies.
Blaschko turned to Page 5, “Typical Allocations,” which include the Auditor/Treasurer, Attorney costs, Building Maintenance, Information Technology, Purchasing, Security, and other functions. These allocations will go toward Social Services and IV-D Programs, and is primarily where the County will collect money. She said the CAP may also be used to collect proprietary funds like water and sewer, if the County chooses. MAXIMUS identifies the maximum amount the County may charge. For example, Blaschko said the County would not be able to collect indirect costs for Parks Department services, but indirect costs could be included in the fee analysis for Planning & Zoning and building fees.
Directing attention to Page 6, “Why MAXIMUS,” Blaschko said the company has been in business for more than 30 years. They utilize significant quality control and creative thinking to increase indirect cost recoveries. Recently the company brought an issue to the State of Minnesota. Years ago there was a cooperative agreement when the courts were designated County courts. It was possible to recover the costs of supporting the courts as part of the IV-D program. Once the State took over the courts, the indirect cost did not go away, but there was no mechanism to recover those costs. MAXIMUS got the State to agree that those are now allocable costs which are recoverable. The State responded by changing their cooperative agreement plan to include those indirect costs as an allocable function going forward. Therefore, security for the courtrooms and the IV-D programs that benefit from it is an allocable function to the degree it benefits IV-D. IV-D is typically three to six percent of a caseload. Depending on how security is allocated at the County, Blaschko said the allocable benefit ranges from $3,000 to $7,000. She emphasized that MAXIMUS follows OMB A-87 guidelines, and has performed this type of report for many years. Blaschko added that they look for consistency.
Hiivala asked the Board to look in the Budget books under Department 100-5400 Federal Grants and Miscellaneous for the Indirect Cost Reimbursement line item. He explained that this is money the County gets back from the federal programs based on the Indirect Cost allocations. As a result of the CAP, the County will get reimbursements from the federal government for these indirect costs.
Daleiden asked the amount of the fee MAXIMUS charged to produce the CAP report. Blaschko estimated $5,000 to $6,000. She said the County is recovering much more than their fee. In addition, the fee to MAXIMUS is not contingent on the amount the County is reimbursed. The CAP report must be done annually. Borrell asked what would happen if the County did not hire MAXIMUS every year. Blaschko said the County would not collect the reimbursement. Daleiden said this report says the County has received $274,662 in reimbursements so far. Blaschko explained that the State Department of Health and Human Services bases the reimbursement on the CAP report. If the CAP wasn’t done one year, the County would not be reimbursed.
Daleiden asked if the County could offer MAXIMUS an incentive if they increase the reimbursement. Blaschko said one of the principles of the OMB A-87 is that a County cannot do anything that will unduly burden a federal program. Doing so would likely prompt an audit. If the County found a $100 per square foot space for Human Services, but other departments paid significantly less, that could be construed as unduly burdening a federal program and would be an audit finding. However, if the County charged every department $100 per square foot, then the federal government would reimburse because that could possibly be considered an allocatable expense.
Daleiden asked how the County compares to other counties. Blaschko said the County fares pretty well. Counties that do better maintain clear functions, good PAR and statistics. For example, she said if a County official does not track his or her time, they won’t recover much in terms of allocable expenditures. Wright County has not had problems with this. She said it also helps when there is good cooperation from staff. It makes it difficult for MAXIMUS representatives when staff hasn’t looked at the previous year’s plan, because they might miss something when preparing the report.
Daleiden asked if the CAP strictly relates to federal funding. Blaschko said it has to do with both, although primarily the State uses federal funds to reimburse the County.
Daleiden said he did not think the Sheriff’s Office generates much reimbursement for the County. However, the Sheriff’s Office is involved with Social Services child protection programs. Vermeulen responded that the Social Services Department tracks how much they spend, so MAXIMUS adds that into the CAP, which takes a percentage of their overall budget. However, they have to disallow any money that is directly billed to the Sheriff’s Office. Blaschko said Social Services has done a cooperative agreement with the Sheriff’s Office agreement, which allows that to be an allocable cost. MAXIMUS has done something similar with security and other overhead costs for the courtrooms and added that into the cooperative cost. MAXIMUS looks at the cost and enters it in the direct billings under Title IV-D.
Blaschko directed attention to Summary Data, Schedule A, on Page 1 of the 135-page document emailed to the Board entitled, “A Central Services Cost Allocation Plan, Wright County, Minnesota, Fiscal Year 2011, Actual Costs For The Year Ended December 31, 2011” (not attached). She explained that the left column lists County departments such as Building Care, Information Technology (IT), County Administration, County Auditor/Treasurer, County Attorney, County Sheriff, and Court Administration that are considered Central Services supporting other agencies or departments. The CAP report also lists Building Use, Equipment Use, Unallocated Insurance, and Other Expenditures.
Blaschko scrolled through Schedule A, Pages 1-4. Across the top of Schedule A is a list of departments that benefit from Central Services provided by County departments. She said MAXIMUS identified $277,717 in allocated costs for Human Services Income Maintenance. With $23,539 rolled forward, which is reconciliation of projected versus actual costs, the total is $301,256. The County will not receive the entire amount, but will get a percentage of that figure. Income maintenance reimbursement is around 48 to 50 percent, and Social Services receive approximately 12 to 14 percent of $677,361. The County will get 66 percent with Human Services IV-D. The percentages vary from year to year, based on funding (except for IV-D which remains at 66 percent). MAXIMUS has identified $5,000 in allocable costs under the Courts Non IV-D column.
Blaschko moved to Schedule 3 on Page 73 of the CAP, Costs Allocated By Activity, County Auditor/Treasurer. The Auditor/Treasurer Department had $1,960,463 in expenditures. MAXIMUS detailed them all, and then examined staff functions. She said they do general administration (i.e., supervision), accounting, warrant (or check) processing, payroll service, as well as banking, switchboard, mail service, State Auditor, and General Government. Blaschko said General Government takes about $1.3 million of the Auditor/Treasurer’s Office. Again, Blaschko said legislative election costs or costs related to property taxes are not allocable.
Blaschko said other functions are allocable. For example, Blaschko referred to Department Accounting. Of the $1.9 million in expenditures, $254,429 is Department Accounting. Add in $52,703 for supervision (under General Administration), and MAXIMUS found a total of $319,683 in total allocated costs under Department Accounting.
Blaschko said the next question they ask is how to allocate Departmental Accounting. She turned to Page 77. They use the General Ledger transaction log and software to count the physical transactions. For this report for the year 2011 they counted 34,308 transactions. Of that, Human Services Income Maintenance had 5,292 transactions, Social Services 8,895, or 15 and 25 percent respectively, for a total allocation of $49,529 and $83,236. The hallmark of the CAP shows all allocated costs. Blaschko said she can trace back every dollar going to the federal government, she can explain exactly where that figure came from and which statistic drove her to that conclusion, and balance it back to the General Ledger. That’s the information the federal government seeks when they are reviewing a cost plan. She said the summary schedule form for the Auditor/Treasurer lists how much Human Services received in allocations. Blaschko said they can identify every item to the detail in the CAP report.
County departments often ask how they can impact their indirect costs. MAXIMUS needs to know whether every invoice is paid the same way in order to compare apples to apples to make sure a federal program is not unduly burdened. Also, if an employee is spending an enormous amount of time on a service, MAXIMUS wants to capture it.
Blaschko turned back to Page 19 of the CAP report, entitled “Schedule .4 Detail Activity Allocations.” The CAP shows a total of $1,473,179 allocated, and $272,576 is administration and $1.2 million is direct. Blaschko said all the dollars will be allocated. There is no amount of Information Technology costs that are disallowed for legislative functions. They are allocated based on total Management Information Systems (MIS) devices per department. IT has a total of 1,064 devices. Other county departments have 115. Daleiden said the two biggest numbers were the Sheriff’s Office and Human Services at 35 and 45 percent respectively. He asked if that is the best way to track this information.
Blaschko said some counties have support logs to log hours. The Sheriff’s Office has a huge number of devices. If someone in the Sheriff’s Office tracked the information that is paid out of the Sheriff’s budget, MAXIMUS could discount the number of devices. This would increase the overall allocation to other departments. Some counties calculate this based on the number of Internet connections or hours of activity. Blaschko said it is difficult to find another method unless there is data to back it up. Ideally, that would be a support log. For now, calculating by the number of devices is easiest. Looking at Human Services at 35 percent is it reasonable to say that about 1/3 of staff time is spent working on Human Services projects? The department will agree or disagree. If not, MAXIMUS asks what would be a better measure. If their response is they have someone assigned to that department 100 percent of the time, MAXIMUS could create a function called Human Services Support and enter the employee’s entire salary into that function, and then allocate based on that data. Those are the types of situations Blaschko seeks when gathering data for a CAP.
Daleiden asked whether she and her colleagues had suggestions or guidelines to improve tracking and increase reimbursement. Blaschko said they try to provide suggestions. She said they ask employees to explain what they are doing, and whether anything has changed. Do the numbers appear reasonable? Would it make sense to look at something else? Blaschko said their efforts change as technology changes.
Daleiden asked if she recommends that the Auditor/Treasurer place items like software and hardware on separate budget line items, instead of together. She replied that MAXIMUS goes through the County inventory and identifies what is documented. Separating line items would make their job easier, although it wouldn’t change the results. Vermeulen said if MAXIMUS cannot discern whether a line item is for hardware or software, they can look it up in the activity report in the General Ledger. The detail in that report will usually provide the information.
Blaschko said they talk to department staff when they have difficulty tracking a cost. Daleiden asked whether she had talked with the IT staff regarding how they can do a better job of monitoring costs. Vermeulen said he spoke to them a few months ago. He will discuss this with them when he returns. Borrell said there are other support people as well.
Blaschko reminded the Board that it is important not to unduly burden a department, as that will raise a red flag over the CAP and prompt an audit. Daleiden said the cost has to be justified. He said the IT Department is spending an excessive amount of time on Human Services. Blaschko said she will look at it. Daleiden said he asked Bill Swing, IT Director, if the 35 percent allocation relates to the amount of time staff spent, and he said it did not.
Blaschko said the good news is when MAXIMUS does a CAP, Vermeulen will do a plan for 2012 expenditures that will be used for the County’s recovery in 2014. However, that is just a projection. In 2014 when MAXIMIUS comes back to do the CAP, the roll forward takes the projections and reconciles them to the actual expenditures. They try to avoid a roller coaster where the County gets a huge amount back in one year and the next two years they pay it back.
Vermeulen said when they see a large jump above or below, they look back to previous years and identify what expense caused the rise and what allocation unit caused this to increase the reimbursement. MAXIMUS does not accept a plan in-house without determining the cause of fluctuations.
Blaschko said there are statements in the management letter regarding why the County costs have changed. Daleiden said IT spent time on software rollouts. She offered to come back to the County if the Board has any questions. She added that if the State took issue with anything, MAXIMUS will take care of it as part of their service. They have federal cost negotiators who assist with such matters.
Recommendation: None - informational item only.
(End of 10-15-13 Committee Of The Whole Minutes)
A Labor/Management Health Insurance Committee Of The Whole Meeting was held on 10-10-13. At today’s County Board Meeting, Borrell moved to approve the minutes, seconded by Daleiden. Sawatzke said that in light of the excise tax on high cost coverage or “Cadillac Tax” being implemented in 2018, it is good that the County has initiated the process of holding the line on individual employee health coverage. He said that is where they are looking at the potential for the “Cadillac Tax”. He thinks the County can resolve this by 2018 given the current path that is being taken. Sawatzke said he is confused why the majority of the Supreme Court did not make a decision to correct this. He stated that there are many new taxes, and this another tax to add to the multiple taxes the County will pay. Husom said there is an estimated 27-30% tax increase in costs under the Affordable Care Act (ACA). Penalties will also be paid by those with better health care plans. Sawatzke said the goal of the ADA was to make sure everyone had health insurance. Now people are being penalized if they have a better health care plan. He said it will basically drive everyone to the same level of service. Potter said the penalty paid by Wright County could be $200,000-$500,000. Sawatzke said the County has five years to resolve this. By virtue of the actions during the last contract discussions, they started to resolve some of that. The Committee saw insurance issues internally. This puts an external force on the County to avoid that type of tax. The motion to approve the minutes carried 5-0:
I. DISCUSS AFFORDABLE CARE ACT (ACA).
Coglitore provided an overview of the ACA and the requirements this has placed on the County. Employers were required to notify employees of the “marketplaces” by October 1, 2013. If an employer does not meet minimum value requirements a tax credit would be available for employees using the exchange. However, Coglitore stated the County’s plan meets the minimum value test for health plans and County Employees using the exchange would not be eligible for these credits.
As a “large employer” the County is subject to taxes and fees under the ACA. Coglitore outlined the Patient-Centered Outcomes Research Institute Fee (PCORI), Transitional Reinsurance Program Fee, and Health Insurance Provider fee and their impact on the County was discussed. HealthPartners will handle the calculation and payment of these fees.
An Excise Tax on High Cost Coverage or “Cadillac Tax” has been delayed until 2018. In 2018 a 40% tax will be imposed on the value of health insurance benefits exceeding $10,200 for individual coverage or $27,500 for family coverage. Coglitore said these thresholds may be adjusted in the future. He cautioned that if the County maintains its current plan offerings they will be subject to this tax in 2018. His estimates showed the cost to the County would be over $200,000 annually.
Berg reviewed the claims summary over the previous 2 years. He stated the County has had high loss ratios over the past few years which have increased costs. The ratio from 8/1/2011 through 7/31/2012 was 96.68%. The County’s ratio is improving and is currently at 86.56% for the 8/1/2012 through 7/31/2013 period. Adjusters like to see this ratio around 85%.
Catastrophic claims are also down from 21.51% of total claims in 2012 to 19.54% as of 8/31/2013. Berg stated that while this figure is trending downward it is higher than this normal range of 10-15%.
Berg referenced Medical Network Utilization over the past year. In-Network utilization is approximately 97% of all claims. Berg stated this indicates network access is very good for the County’s plans.
Coglitore presented a Health Insurance Renewal Synopsis for the years of 2008-2013. These graphs illustrated the annual rate increases proposed by the County’s health insurance provider and the rates negotiated by B&C. Coglitore estimated B&C has negotiated a savings of $5,229,108 for the County since 2008.
II. PLAN DESIGNS.
Bigelow distributed a summary of how many employees are on each health plan, by Union. She stated most employees are on Plan 1, especially those electing single coverage. Employees with family coverage often choose plan 3. Plan 2 does not receive much participation.
Bigelow stated she has received many comments from employees regarding the high cost of family coverage with the County’s health insurance offerings. She inquired if there was any appetite to pursue changes to plan offerings. The group overwhelmingly responded yes. Bigelow acknowledged health insurance benefits need to be negotiated with the unions. Bigelow asked B&C to pursue quotes for alternatives to our current plans. B&C will not have quotes on insurance rates until November. This would leave a short timeline if changes were to be implemented for open enrollment in 2014. Bigelow recommended meeting again after Thanksgiving to discuss this topic.
(End of Labor/Management Health Insurance Committee Of The Whole Minutes)
Borrell asked whether he could petition to the meeting a claim from the Swanson Brothers for work completed on Ditch 30 to remove a beaver. Sawatzke requested that approval of the claim be referred to the 11-05-13 County Board Meeting, as he does not want to get in the process of petitioning claims onto the Agenda.
Allina Hospitals & Clinics $150.00
Ameripride Services 621.10
Annandale Rock Products 455.95
Annandale/City of 1,543.00
Aramark Services Inc 7,136.88
Astleford International 2,322.53
Bob Barker Company Inc 174.96
Buffalo Hospital-OTPT Comm 481.21
Buffalo Township 690.40
Bureau of Crim. Apprehension 120.00
CDW Government Inc 511.97
Center Point Energy 732.81
Centracare Clinic 153.92
Central MNMental Health Ctr. 157.45
Clearwater River Watershed 2,289.73
Creative Forms & Concepts 753.89
Croteau Plumbing 3,068.50
Culligan of Buffalo 450.00
Delano Rental Inc 416.30
Delano/City of 2,537.60
Dell Marketing LP 1,653.12
Design Elect. Inc-Cold Spring 7,600.00
Edocument Resources 2,645.00
EMCS Inc 450.00
EPA Audio Visual Inc 400.00
Forest Mushrooms Inc 1,369.00
Gilson Company Inc 797.09
Gopher State One Call 246.60
Hancock Concrete Prod. LLC 3,223.59
Hedlund Plumbing 1,125.00
Intoximeters Inc 296.58
J & J Marine Inc 115.48
Jakes Excavating 2,357.50
Joes Machinery Company 8,211.00
Keaveny LTC Pharmacy 2,734.27
Kemble Inc 9,000.00
Keystone Interpreting Serv. 980.00
Laplant Demo Inc 620.46
Madden Galanter Hansen LLP 1,671.07
Martin Marietta Materials 423.72
Melby Cons. and Design LLC 150.80
Menards - Buffalo 364.34
MN Counties Comp. Coop. 452.78
MN Corrections Association 485.00
MN Depart. of Human Serv. 342.64
MN Fall Maintenance Expo 765.00
Moore & Moore Advantage 150.00
Morries Parts & Service Group 176.09
Mumford Sanitation 1,164.21
North American Salt Co 9,145.47
Office Depot 523.06
Rice/Nicole L 150.00
Royal Tire Inc 6,141.56
RS Eden 1,634.57
Schedule Soft 3,260.00
SHIi International Corp 7,467.25
Specialty Turf & Ag 296.26
SRF Consulting Group Inc 4,817.92
St Cloud Fire Equipment Inc 161.50
St Cloud Hospital 2,756.54
State Supply Co 146.73
Total Printing 180.89
Traffic Marking Service Inc 1,831.65
Trueman Welters Inc. 479.99
Twin City Seed Company 310.56
Unlimited Electric Inc 274.35
Victor Township 1,822.10
West Payment Center 1,119.68
Westside Wholesale Tire 538.67
Wright Co. Highway Dept 480.00
Wright Henn. Coop Elec Assn 6,053.28
Wright Hennepin Electric 705.87
Zacks Inc 3,167.37
18 payments less than $100 1,017.40
Final total: $ 404,678.87
The meeting adjourned at 10:13 A.M
Published in the Herald Journal Nov. 18, 2013.