HomeMy WebLinkAbout08/08/1988 Meeting (2)
e M I NUT E S
Eugene City Council
Council Chambers--City Hall
August 8, 1988
7:30 p.m.
COUNCILORS PRESENT: Freeman Holmer, Ruth Bascom, Robert Bennett, Debra
Ehrman, Emily Schue, Jeff Miller (until 9:10 p.m.).
COUNCILORS ABSENT: Roger Rutan, Cynthia Wooten.
The regular meeting of the City Council of the City of Eugene, Oregon, was
called to order by His Honor Mayor Brian B. Obie.
I. PUBLI C FORUM
Mayor Obie gave an opportunity to those who wished to address the council
about subjects that are not scheduled for council consideration.
Marlon L. Ornoff, 848 North Cloverleaf Drive, called the council's attention
to the traffic hazard at the intersection of Country Club Road and Coburg
e Road. He said cars merging at the intersection pose safety hazards, espe-
cially at peak traffic times. Mr. Ornoff said he is aware the council is
facing budget restrictions; however, he said something should be done to
improve the current situation. He suggested one solution might be the in-
stallation of synchronized signals to regulate the flow of traffic.
Mayor Obie said Mr. Ornoff1s comments and suggestions would be forwarded to
Transportation Engineer Dave Reinhard.
Lauri Thomas, 830 Larch Street, said she has a 91-year old grandmother in
need of daily contact with relatives, Ms, Thomas said she has investigated
various living alternatives for her grandmother who lives on a fixed income
of $349 in Social Security benefits. However, due to the recent rent in-
creases in the local area, Ms. Thomas said purchasing a used mobile home for
$10,000 to $12,000 is the most feasible alternative.
Ms. Thomas said she was first told by City staff that medical hardship per-
mits for mobile homes are available. However, she has since found that Lane
County instead of the City approves medical hardship permits. Ms. Thomas
said they live within the City on a 13,000 square-foot lot, ma~ing them
ineligible for such a permit. She said they do not qualify for the financial
assistance to build a new home on their lot. She said there a~e other people
in the area facing similar situations. Ms. Thomas noted that cities of
Albany, Cottage Grove, and Florence all provide medical hardship permits.
She asked the council to make a statement of concern toward the elderly and
e MINUTES--Eugene City Council August 8, 1988 Page 1
e disabled and take the necessary steps to allow for their care in a reasonable
and affordable manner. She said the council can also choose to make a state-
ment of disregard by not amending an incomplete housing code.
Mayor Obie said Planning Department staff will respond to her concerns and
make report back to the council.
City Manager Mike Gleason asked the council to delay the scheduled public
hearing on an ordinance concerning the River Road/Santa Clara Urban Facili-
ties Plan Amendment. He said the Lane County Planning Committee has made a
recommendation that is not consistent with the City's Planning Commission
recommendation. Hearing no objections from the council, Mayor Obie said the
council would delay action on the item until an agreement has been reached.
II. PUBLIC HEARING: ORDINANCE CONCERNING TRANSFER OF ELECTRIC SERVICE
TERRITORY IN THE WILLOW CREEK AREA FROM LANE ELECTRIC COOPERATIVE TO
THE EUGENE WATER AND ELECTRIC BOARD
City Manager Mike Gleason introduced the item. Susan Brody, Planning Direc-
tor, presented the staff report. She said the issue has been a concern for
City for several years. She reviewed that the City held work sessions in
1986 during which the City asked Eugene Water & Electric Board (EWEB) and
Lane Electric Cooperative (LEC) to present information on their abilities to
serve the Willow Creek area. She said the concern came out of evidence that
rate differential and reliability issues may cause problems for industry
e recruitment. She noted the City has made a substantial investment in sewers
and road construction.
Ms. Brody said negotiations between EWEB and LEC have broken down. For that
reason, she said staff is asking the council to consider adopting the ordi-
nance as a way of putting pressure behind continuing negotiations. The area
in question represents 15 out of LEC's approximately 10,000 customers. The
area in question is 510 acres, all within the City of Eugene, She said the
council is also being asked to consider the transfer of 49 customers who live
within EWEB's service territory but who are currently served by LEC.
Ms. Brody said the primary reasons the City is considering the action in-
clude: duplication of service in the Willow Creek area, rate differential,
and reliability of service, She said EWEB currently has two substations
available to serve the area while LEC would have to construct a new substa-
tion. The rate differential is an impediment to industries considering
locating in the area. Ms. Brody noted staff has evidence indicating that
rates are a point of confusion and discomfort to industries looking into the
area. Ms. Brody turned the staff presentation over to EWEB representatives.
Laurie Power, EWEB governmental affairs coordinator, said EWEB commissioned
R.W. Beck, an independent consultant, to research the impacts of such a
transfer on current LEC and EWEB customers, as well as potential future
customers. Kurt Winnerfeld, R.W. Beck representative, said the methods and
assumptions used in the study were provided to the council in a written
e MINUTES--Eugene City Council August 8, 1988 Page 2
e report. He said the method used forecast the financial requirements, invest-
ments, expenses, and rates absent service to Willow Creek. A second forecast
was prepared using the same factors and including the various expenses of
serving Willow Creek.
Mr. Winnerfeld said the following results were determined if EWEB served the
Willow Creek area: 1) there would be an approximate $3 million decrease in
costs over a 20-year period for both utilities' customers; 2) the rates and
total utility costs paid by Willow Creek customers would be lower if served
by EWEB; 3) a slight decrease in the rates paid by other EWEB customers would
occur if the utility served the area; 4) a slight increase for LEC customers
would occur if EWES served the area.
Ms. Brody pointed out the council's packets include testimony from the Metro-
politan Partnership, Lane Electric Cooperative, a letter on behalf of
Blachley Lane, and two letters from residential property owners, one favoring
the transfer, and one opposed.
For the audience's benefit, Mayor Obie said the council has received an
immense amount of studies and written testimony over the issue. He said the
council also spent from 5:30 p.m. to 7:15 p.m. this evening in a work session
asking additional questions. Following tonight's public hearing, Mayor Obie
said the record will remain open until 5 p.m. Tuesday to receive additional
written testimony. The council will make a decision on the issue at its
August 10, 1988, meeting.
e Mayor Obie opened the public hearing.
Jim Saul, 111 West 7th Avenue, Suite 300, said he is speaking on behalf of
Gonyea and Associates, which controls Willow Creek Park. He said the company
strongly endorses the transfer of electric service to EWEB. Willow Creek
Park represents nearly 50 percent of the area being considered in the trans-
fer. The question of which utility serves the area has been of concern to
the developers because of the traditional disparity in rate structure, reli-
ability of service, and relative capital strength of the two utilities.
Since the recent improvements to the Willow Creek Park area were completed,
Mr. Saul said firms considering locating there have rejected the area because
of the disparity in rate structure. He said this problem is particularly
acute because firms that have learned about EWES's rate structure arrive to
find a different utility serving the area. Mr. Saul encouraged the council
to review the boundaries of the service area. He noted that Willow Creek
Park is surrounded on 3-1/2 sides by EWEB service area.
Richard P. Haugland, 4849 Pitchford Avenue, said he is president of Molecular
Probes Inc., the largest employer in the Willow Cr~ek area with approximately
45 employees. He said Molecular Probes is a model of the type of industry
Eugene is seeking to attract; its business and products are research orient-
ed. Molecular Probes is currently building an addition that will nearly
triple its existing space and increase its number of employees.
e MINUTES--Eugene City Council August 8, 1988 Page 3
- Mr. Haugland said his company requires constant ventilation due to the poten-
tially hazardous chemicals it uses. In addition, some of its scientific
instrumentation is also subject to damage from power failures or line fluctu-
ations. While the company has not experienced major problems in service from
LEC, he said the cost of electricity is becoming a significant factor in its
operations. Mr. Haugland said it is time to remove any barriers to develop-
ment of Willow Creek, one of which may be the concern over the electrical
supplier, and transfer service of the area to its logical supplier, EWES.
A, Dean Owens, 2160 Oakmont Way, said he is speaking on behalf of the Eu-
gene-Springfield Metropolitan Partnership. He said the Metro Partnership's
executive committee is taking a neutral stance on the issue of which utility
should service the area.
Mr. Owens asked the council to note perceptions, critical factors, public
rates, current rates in the written testimony provided by the Metro Partner-
ship. Of the 20 business prospects surveyed by the Metro Partnership that
listed electricity rates as a critical factor, Mr. Owens said they all per-
ceived EWES as the utility with lower rates and more reliable and readily
available service.
Richard Miller, 2460 Malasar Drive, said he is speaking as president of the
Eugene Area Chamber of Commerce, He said the chamber1s executive committee
has decided not to take a position on the issue. However, he said the cham-
ber hopes the council chooses the organization that is best able to serve the
area at the lowest rates, and provide the most reliable and available ser-
e vice.
Charles Fadeley, 350 Farm Building, said he is representing LEC at the hear-
ing. He said LEC has requested that the council hold a special session to
discuss this issue because of its complexity and importance. He said LEe was
not invited to attend tonight's work session.
Mr. Fadeley said LEC is a not-for-profit electric cooperative that is a
preference customer of the Bonneville Power Administration (SPA). LEC has a
50-year service history of supplying low-cost power. Its rates are among the
lowest in Oregon as well as the country. He said LEC started serving the
Willow Creek area over 40 years ago when EWES would not.
Mr, Fadeley pointed out that the first of staff1s findings state the metro
policies make EWES the legal provider of the area within the Urban Growth
Boundary, He said Oregon land use law precludes differentiation between
service providers. The R.W. Beck study says it will cost an additional $1.4
million if EWEB does not serve the area because EWEB will have to run lines
diagonally through Willow Creek to connect substations. He said it does not
make sense from an engineering standpoin~ that distribution lines should
bisect the Willow Creek area. It would make more sense for the lines to
follow the existing roads, which would lead around the Willow Creek area in
any event.
. MINUTES--Eugene City Council August 8, 1988 Page 4
e Mr. Fadeley said the boundaries make sense if one walks through the area and
looks at the geographic configuration. He pointed out EWES is the utility
with irregular boundaries that do not make sense since it serves Weyerhaeuser
in east Springfield, customers up the McKenzie River to Vida, and Lane Commu-
nity College. In 1968, LEC applied to the Public Utility Commission (PUC)
for a certified boundary. It was awarded that boundary after input from LEC
and EWES as to what boundary would make the most sense. He said legal coun-
sel for EWES stated at that meeting that the utility accepted the authority
of the PUC to act in this manner. He said EWES is now looking to change
those boundaries because the area has become economical and efficient to
serve.
Mr. Fadeley said LEC is willing to spend whatever it takes to meet the load
in the Willow Creek area. LEC commissioned an independent study by CH2M Hill
that found LEC can provide the service needed. He disputed R.W. Beck's
findings that LEC costs are higher because of outages. Since LEC has started
serving the Willow Creek Industrial Park in 1984, he said there has been one
small outage due to a fault in the system. He said comparing connection
costs is difficult because policies vary between residents and connections.
LEC connection policies are liberal and usually low-cost.
Mr. Fadeley said the R.W. Beck study did not factor in LEC's added costs due
to a loss of anticipated load. He pointed out electric utilities are capital
intensive entities. The piecemeal ,taking of territory hinders LEC's overall
efforts to provide efficient and economic operations. He asked how LEC can
efficiently plan to meet its load growth if it does not know where it is
e going to serve. He noted that six years ago LEC had lower published rates
and did not come before the council at that time and ask for EWES territory.
He said the council should not transfer territory based on a variable such as
rates. He said LEC questions the assumption that the current rate differen-
tial will always remain the same.
Mr. Fadeley addressed the issue of economic diversification. He said LEC
would like the City to stop sending letters to LEC customers that are inaccu-
rate and disparaging of its service. He said the pace of economic diversifi-
cation is not enhanced by inaccurate statements about service reliability and
ability to serve. LEC has a proven record of service reliability. The CH2M
Hill study states service is available from LEe for the projected load
growth. Of the 20 prospective businesses noted earlier by the Metro Partner-
ship, he said only three from the list considered locating in the Willow
Creek area. Of those, two did not choose to locate in available light indus-
trial land served by EWES.
Mr. Fadeley said LEC negotiated at length with EWES. He said EWES rejected
several alternatives including interconnection, territory swapping, and a
provision that would let EWES serve ~he industrial park with some degree of
permanence. He reiterated his request that the council provide additional
opportunity to receive information. He said LEe would like to be a full
partner in the area's economic development.
. MINUTES--Eugene City Council August 8, 1988 Page 5
e Mark Glaess, 575 Union Street, Salem, said he is general manager of the
Oregon Rural Electric Cooperative Association (ORECA), which represents 16
member-owned cooperatives. He said public power works well together in
Oregon, and reviewed ORECA's opposition to a bill in the 1987 legislature
that would have stripped local government's ability to condemn utility prop-
erty. He said the group opposed the bill because it is not in the best
interest of public power in the legislature. He said the decision by the
council on this issue will have an impact on how public power works together
in the upcoming legislature. He said opposing the transfer will make that
arrangement harmonious.
Richard Butler, 1200 Executive Parkway, said he is general counsel for
Blachley Lane Electric Cooperative Association and ORECA. He said he opposes
the ordinance and asked the council not to decide the issue on perception.
He said the council is being asked to condemn and take over part of a Eugene
business's attractive industrial area. The council should not establish a
precedent whereby it condemns a utility's territory--no matter how low its
rates are--because another utility has even lower rates. He said the council
should provide evidence that economic development in Eugene, Springfield, and
Lane County is being hurt by LEG's rates before it passes this ordinance.
Mr. Butler pointed out electric cooperatives have a system of capital credits
that give cost versatility apart from rates. He described the ordinance
before the council is a political, economic, and public power bombshell.
L.G. Erickson, 77724 High Prairie Oakridge, submitted written testimony. He
e urged the council to cast a negative vote on the utility service transfer.
He said decisions of this nature should be based on rational and logical
facts in consideration of the overall regional implications, and not self-
serving territorial grabs. He said he is concerned about the economic impact
on the region and LEe members; the availability, quality, and cost of elec-
tric power to future consumers in the area; and Oregon PUC territorial desig-
nations. He said all other factors are political and empire-building in
nature.
Chuck Ivey, 24790 Wolf Creek Road, Crow, urged the council to study the Metro
Partnership's presentation, which points out the errors and omissions of City
staff. He said the problem is that four years ago LEC was the only utility
willing to serve the area. From the point of a view of an LEe member, he
said he is not in favor of hampering the utility's economic development
potential by taking away territory. He asked the council to be fair to its
neighbors in making their decision.
Dean Kortge, 5330 Nectar Way, said it appears like one public agency is
trying to cream off a closer-in area from another agency, He urged the
council to leave things a~ they are, and commend LEC on its service system
and reliability.
Ed Zenith, 92160 Blue River Road, Blue River, said he is both an LEC and EWEB
user. He said it is unfortunate that the area has two excellent utilities
that have a disagreement. As a retired utility budget and administrative
e MINUTES--Eugene City Council August 8, 1988 Page 6
e officer, he said he understands the utility business well. He said the
council should base its decision on personal ethics. Mr. Zenith said his
opinion of EWEB would deteriorate significantly if the utility pursues the
territory transfer.
Leon S. Yaggy, 49363 Eagle Rock Place, Vida, said he is a retired electrical
engineer and has been a member of LEC for over six years. LEC has provided
the McKenzie River schools and homes with excellent rates; in fact, he said
the latest rate change was a reduction. He said he is confident LEC can
provide highly competent service at competitive rates. Mr. Yaggy said the
City of Eugene would be abusing its authority if it proceeds with the condem-
nation proposal.
Ray McGowan, 29190 McTavish Lane, said he has been an LEC customer for 25
years. He said he has a "fistful" of names from neighbors who prefer to
remain in the cooperative. Mr. McGowan pointed out that while he respects
the work of R.W. Beck, consultants can highlight certain facts if they know
what their clients objectives are. He said high property taxes rather than
electrical rates are the primary factor in businesses not choosing to locate
in the area. Mr. McGowan said the price of transferring LEC facilities to
EWEB will be borne by City taxpayers.
Martha G, Shearer, 83499 Rattlesnake Road, reminded the council that if it
bases its decision on current rate~, it should look at the fact that EWEB
increased its rates in 1983 and 1988, while LEC dropped its rates in 1986 to
its 1983 level. If EWEB expands its facilities, it will have to increase its
e overall rates because low-cost power is being spread out over a larger base,
She said she and her family have enjoyed wonderful service, responsiveness,
and good customer relations for the over 17 years they have been LEC custom-
ers.
Curtin Mitchell, PO Box 38, Lorane, said transferring territory from LEC to
EWEB would be doing a disservice to all of Lane County. He said the study
done by CH2M Hill shows that LEC can provide service as reliable as that of
EWEB. He said the abuse of the members/owners of LEC reflects on local
control and democracy at the grass roots level. Mr. Mitchell said a pamphlet
from the State Economic Development Department shows that property taxes top
the list of factors contributing to the business climate, while electrical
rates are much farther down. If electrical rates are so important, Mr.
Mitchell asked why there aren't more companies coming to the area since it
has some of the lowest rates in the country.
Mayor Obie closed the public hearing.
Ms. Brody said the Willow Creek area is becoming more, not less, important as
a primary site in the City's industrial inventory. She said the City is not
able to offer as many incentives as other areas of the country. A differen-
tial in electrical rates can end up being a factor in a company's decision on
where to locate,
e MINUTES--Eugene City Council August 8, 1988 Page 7
e Ms. Brody noted that EWEB did protest the PUC's decision to certify the
boundaries. She said Metro Plan policies, while not being a deciding factor
in the matter, do represent public policies that are adopted at the local
level and are relevant. Ken Beeson, EWEB Engineering Manager, addressed the
distribution feeder line issue. He said the basic design criteria for such
lines is based on land area, zoning, and load. He said EWEB could place its
feeders around the area and would prefer to do so. By choosing to go through
the area, he said EWEB opted for the most economic action.
Mr. Winnerfeld addressed comments that EWEB's service to the area would
prevent rate stability to other LEe customers, and that the R.W. Beck study
assumed the rate differential would remain constant. He said both statements
indicate a misunderstanding of the methodology and process used to arrive at
the results. He said the study used projections from the CH2M Hill study to
make a detailed forecast for financing and investment requirements, and
resulting impact on expenses and rates. He said R.W. Beck tried to look at
all components from both utilities that go into developing revenue require-
ments.
Ms. Power said negotiations between the two utilities began in January and
went through March. By that time, the two general managers had reached an
agreement on general goals. Several months into the negotiations, she said
LEC surprised EWEB with a requirement for a written agreement guaranteeing a
permanent boundary for LEC as well ,as the right to serve within the Urban
Growth Boundary.
e Ms. Power said EWEB does not have the authority to sign the agreement. LEe
refused to negotiate without such an agreement. EWEB has since tried two
more times to initiate negotiations. She said negotiations still remain
EWEB's first and best option for resolving the dispute.
Ms. Ehrman asked about the additional 49 customers, Ms. Brody said they are
currently within EWEB service territory, but have traditionally been served
by LEC. Ms, Power said the 49 customers date back to the 1950s when LEC had
lines closer to the area. Since then, the area has grown and customers
moving into the area have become EWEB customers. The 49 customers are a mix
of residential and commercial. Ms. Brody said it seemed appropriate to deal
with this issue at this time.
Ms. Ehrman asked why the customers have remained with LEC if they are in EWEB
territory. Ms. Brody said there is no mechanism that allows for the change.
Mr, Gleason said the issue with these customers has been under discussion for
the last 25 to 30 years, He said a tentative agreement was put together to
resolve the issue. However, he said that apparently fell apart when it got
before the PUC.
Ms. Schue asked what the current rates are for residential customers for both
utilities. Mr. Norm Oakely said LEC has a current base rate of $7 and charg-
es a 3.69 cents flat rate per kilowatt hour. Ms. Power said EWEB has a $5
per month basic charge and charges 2.9 cents per kilowatt hour,
e MINUTES--Eugene City Council August 8, 1988 Page 8
e Mr. Holmer asked if exhibit A defines the property sufficiently to ensure
that, if the council adopts the ordinance, it would address the 49 customers.
Ms. Brody said that it is sufficiently defined.
Mayor Obie reiterated that the council will be making its decision at the
August 10 meeting. He reminded members of the audience that the transfer
action was initiated by the City of Eugene and not EWEB.
III. PUBLIC HEARING: ORDINANCE PROVIDING FOR CONSOLIDATION OF LAND USE
PROCEDURES (CA 88-2)
City Manager Mike Gleason introduced the item. Jean Hahn, Planning Depart-
ment, presented the staff report. She said this item amends Chapter 9 of the
Eugene Code and allows the Hearings Official to hear a combination of zone
change/conditional use applications, and zone change/tentative plan unit
developments at one hearing. She said the amendment is a result of changes
brought about during the 1987 Legislative session that require local govern-
ments to provide for a consolidated land use process. This amendment brings
the City's policies into conformity with State law.
Mayor Obie opened the public hearing. Having no requests to speak, he closed
the public hearing,
CB 3062--An ordinance concerning Hearings Official authoriza-
tion; adding a new Section 9.684 to the Eugene Code,
e 1971; and declaring an emergency.
Mr. Holmer moved, seconded by Ms. Bascom, that the bill, with
unanimous consent of the council, be read the second time by
council bill number only and that enactment be considered at
this time. Roll call vote; the motion carried unanimously,
5:0.
Council Bill 3062 was read the second time by council bill number only.
Mr. Holmer moved, seconded by Ms. Bascom, that the bill be
approved and given final passage. All councilors voting aye,
the bill was declared passed and became Ordinance No. 19571.
IV. PUBLIC HEARING: STREET VACATION OF A PORTION OF GOODPASTURE ISLAND
ROAD, SOUTH OF VALLEY RIVER DRIVE (WESTCOAST FREEHOLDS) (SV 88-3)
City Manager Mike Gleason introduced the item. Jerry Jacobson, Planning
Department, said the pr0posed street vacation involves a 50-foot wide portion
of Lane County right-of-way that extends 127 feet into Valley River Center.
Valley River Center uses this portion of the southern end of Goodpasture
Island Road for entry way into its parking areas. He said Valley River is
requesting street vacation because of expansion plans that include possible
e MINUTES--Eugene City Council August 8, 1988 Page 9
redesign of traffic circulation patterns within the shopping center. He
e noted the vacation procedures have to go through Lane County as well.
Mayor Obie opened the public hearing.
Richard Hansen, Executive Office, Valley River Center, Eugene, Oregon, said
the particular piece of property is surrounded by Valley River property and
falls within the criteria for giving it back to the property owner. He said
Valley River thinks it's appropriate that the property be released.
Mayor Obie closed the public hearing.
CB 3063--An ordinance vacating a portion of Goodpasture Island
Road, located south of Valley River Drive within
Valley River Center.
Mr. Holmer moved, seconded by Ms. Bascom, that the bill, with
unanimous consent of the council, be read the second time by
council bill number only and that enactment be considered at
this time. Roll call vote; the motion carried unanimously,
5:0.
Council Bill 3063 was read the second time by council bill number only.
Mr, Holmer moved, seconded by Ms. Bascom, that the bill be
approved and given final passage. Roll call vote; all coun-
e cilors voting aye, the bill was declared passed and became
Ordinance No. 19572.
V. PUBLIC HEARING: ORDINANCE REGULATING PUBLIC CONTRACTS
City Manager Mike Gleason introduced the item. Dave Biedermann, Finance
Division, presented the staff report. He said the regulations described in
the ordinance accurately reflect both State of Oregon and City of Eugene
legal direction and operating realities necessary to perform public contract-
ing responsibilities. He said they are the result of exhaustive discussion
and research and were reviewed by representatives from all City departments.
Mr. Biedermann said the attempt to clarify the City's public contracting law
goes beyond the ordinance with administrative adoption of the Public Contract
Administrative Rules, These rules layout in detail the procedures for
advertising, format, bid acceptance, evaluation, and award. He said there
are no significant changes from the present contracting practices of the City
included in the ordinance. At the mayor's request, he said the ordinance
includes provisions for review of the application and policies as a part of
the annual audit.
Ms. Ehrman asked about the procedure for contracting works of art. Mr.
Biedermann said an evaluation process has been developed to handle the sub-
jective nature of public art contracting. This includes citizen involvement.
e MINUTES--Eugene City Council August 8, 1988 Page 10
e Mayor Obie opened the public hearing. Having no requests to speak, Mayor
Obie closed the public hearing.
Mr. Holmer said he was consulted by staff about the ordinance and has sug-
gested a large array of improvements for the legislation. He said this
agenda item and the two following items are a package that would establish
rules that, in his judgment, are not in the public interest.
Mr. Holmer reminded the council that for seven years and 10 months he was
responsible for purchasing and contracting by the State of Oregon as State
Director of Finance and Administration. For 10 years and four months, he was
responsible for purchasing and contracting for the State System of Higher
Education as Vice Chancellor for Administration. He said open and competi-
tive bidding is desirable but not always practical. In reviewing the staff
draft ordinance, he said it became apparent that staff is asking the council
to make a large array of decisions about administrative detail that is incon-
sistent with the council's desire to focus on public policy. He said the
council is responsible for monitoring the City Manager1s actions to the end
that State laws are obeyed and that purchasing and contracting are conducted
honestly and prudently.
Mr, Holmer said the ordinance before the council expects it to focus on a
level of detail it should not be e~pected to master. He said it is staffls
clear objective to have the council adopt the findings in the ordinance as
standards that will govern contract negotiation. If staff acts contrary to
e the public interest, he warned that the defense of such actions might be that
it was authorized by the council.
To avoid this, Mr. Holmer distributed a one-page ordinance that he said
provides th~ type of policy guidance the council should give to staff. He
said his proposal leaves the way open for the council to adopt rules by
resolution at a later date. In staff's current proposal under Section
2.1205, he said he finds it strange that the City Manager shall be the con-
tracting and purchasing agent. He said the definitions do not clearly state
who these individuals are. Mr. Holmer also noted 2.1230 subsection 1, If
staff is going to use this much detail, he suggested the included contracts
should be exempted if they do not encourage favortism and if they result in
savings. He said the council should not exempt in advance any contract in
which the purchasing agent has determined that it is available only through a
sole supplier. Mr. Holmer suggested the ordinance1s language needs to be
more positive.
Mr. Holmer said he is aware the council is inclined to accept staff recommen-
dations on complex matters, However, he said staff eagerness to avoid com-
petitive b~ds in the cause of other City goals should be of great concern to
the council. He reiterated his feelings that the council would be better off
adopting the one-page proposal that subjects the City Manager to the Attorney
Generalis interpretation of State laws.
- MINUTES--Eugene City Council August 8, 1988 Page 11
e Mayor Obie said he respects Mr. Holmer's background in the area of purchas-
ing. He said it is appropriate to note that the council is delegating its
routine purchasing powers. He suggested a follow-up process be initiated to
review the ordinance and investigate whether the procedures are being dealt
with in the manner that the council anticipated.
Mr. Gleason said staff began redrafting the ordinance since legislation was
passed making the council the purchasing body of the City. He noted that Mr.
Biedermann was a member of the State committee that drafted the guidelines
for the State's program. Staff has taken Mr. Holmer's concerns seriously and
met at least six times with him to discuss his suggestions.
Mr. Gleason said the situation has become a philosophical disagreement.
While he respects Mr. Holmer's position, he said he does not recommend that
to the council. If the council adopts Mr. Holmer1s proposal, the council is
left with a situation where everything must be bid formally in a procedure
that costs over $500 for each bid. He said staff would like to pull many of
the detailed purchases under the administrative function. However, he said
under the State law that does not seem appropriate. He said the City's
purchasing procedures are very good and are both flexible and responsive in
that they give the City a public commitment to competitive bid while not
burdening it with unnecessary bureaucratic procedures.
Mr. Gleason said the ordinance is not a substantial difference in the way the
City is currently operating. It is as strict as the State's procedures, and,
in some cases, more strict.
e Ms. Bascom said she respects the tremendous amount of work Mr. Holmer has put
into his recommendations. However, she said Mr. Holmer should have lobbied
for support among the rest of the council earlier in the process.
Mr. Holmer said Mayor Obie was brought in by the City Manager and said he
might have been somewhat deficient in not bringing the issue up to the coun-
cil before now. He pointed out that on matters of substance, staff only
adopted one of his suggestions. He reiterated his position that the council
is deviating too far from sound practice.
Mr. Bennett asked Mayor Obie for his opinions on the issue. Mayor Obie said
he supports staff's recommendation. He said he is comfortable with the
auditing procedures because the council has more review and control than it
has over the last couple of years.
Mr. Bennett echoed Ms. Bascom's comments that Mr. Holmer should have brought
this issue up to the council before now. He said it is difficult to make a
decision on something that entails this level of detail. Ms. Ehrman observed
the City has not had a single appeal since the formation of the Contract
Review Board. She said she might be more inclined to study the issue more if
this were an area where the City was getting more requests for review.
e MINUTES--Eugene City Council August 8, 1988 Page 12
e CB 3064--An ordinance regulating public contracts, amending
Sections 2.1200, 2.1205, 2.1210, 2.1215 of the Eugene
Code, 1971; and adding Sections 2.1220, 2.1225,
2.1230, 2.1240, 2.1245, 2.1250, and 2.1255 to that
Code; and declaring an emergency.
Mr. Holmer moved, seconded by Ms. Bascom, that the bill, with
unanimous consent of the council, be read the second time by
council bill number only, and that enactment be considered at
this time. Roll call vote; the motion carried 4:1, with
councilors Bascom, Bennett, Schue, and Ehrman voting aye, and
Councilor Holmer voting nay.
Since the vote was not unanimous, Mayor Obie said the second reading will
take place at the August 10, 1988, meeting.
VI. ORDINANCE CREATING AN AUDIT COMMITTEE
City Manager Mike Gleason introduced the item,
CB 3065--An ordinance concerning the Audit Committee; amending
Section 2.013 of the Eugene Code, 1971; and declaring
an emergency.
e Mr, Holmer moved, seconded by Ms. Bascom, that the bill, with
unanimous consent of the council, be read the second time by
council bill number only and that enactment be considered at
this time. Roll call vote; the motion carried unanimously,
5:0.
Council Bill 3065 was read the second time by council bill number only.
Mr. Holmer moved, seconded by Ms. Bascom, that the bill be
approved and given final passage. Ro 11 ca 11 vote; a 11 coun-
cilors voting aye, the bill was declared passed (and became
Ordinance No. 19573).
VII. RESOLUTION REGARDING PERFORMANCE OF ANNUAL AUDIT
City Manager Mike Gleason introduced the item.
Res. No. 4094--A resolution regarding Performance of the
A'1nua 1 Audit.
Mr. Holmer moved, seconded by Ms. Bascom, to adopt the resolu-
tion.
e MINUTES--Eugene City Council August 8, 1988 Page 13
e Mr. Holmer moved, seconded by Ms. Bascom, to amend the motion
to add the words "and in consistency with the model Attorney
General contract rules and the Oregon Administrative Rules,
adopted by the State Public Contract Review Board."
Mr. Holmer said the purpose of the amendment is to be sure that the City is
not straying too far from State rules and regulations.
Mr. Biedermann emphasized that the ordinance reflects: 1) the City's histor-
ical contracting practices; 2) the responsibility given to the council and
the City Manager through the Charter; 3) Mr. Biedermann's activity on the
State Advisory Committee that developed the model rules. Including this in
the resolution could potentially cause a conflict if the City adopts rules
separate from the State's model rules. One example is that the State model
rules do not classify contracts, while the City's rules do.
Mr. Holmer withdrew his amendment.
Roll call vote on the resolution; the motion carried unani-
mously, 5:0.
VIII, RESOLUTION SUPPORTING AMICUS INTERVENTION BY THE LEAGUE OF OREGON
CITIES ,
City Manager Mike Gleason introduced the item. He said this resolution
e concerns the City's request on behalf of the League of Oregon Cities with
regard to the Road Fund.
Res. No. 4095--A resolution supporting AMICUS Intervention by
. the League of Oregon Cities.
Mr. Holmer moved, seconded by Ms. Bascom, to adopt the resolu-
tion.
Ms, Ehrman pointed out that in addition to the City, this is affecting other
agencies such as the Lane Regional Air Pollution Authority.
Roll call vote; the motion carried unanimously, 5:0.
IX. FINDINGS AND RECOMMENDATIONS OF HEARING OFFICIAL AND APPROVAL OF
IMPROVEMENT PROJECT (CHAD DRIVE) (JOB #2401)
City Manager Mike Gleason introduced the item.
Mr. Holmer moved, seconded by Ms. Bascom, to approve the
Hearings Official findings and recommendations of July 28,
1988, and to approve the improvements on Chad Drive (Job
#2401) as presented by staff. Roll call vote; the motion
carried unanimously, 5:0.
e MINUTES--Eugene City Council August 8, 1988 Page 14
e FINDINGS AND RECOMMENDATIONS OF HEARINGS OFFICIAL AND APPROVAL OF
X.
IMPROVEMENT PROJECT (SHADOW VIEW DRIVE) (JOB #2399)
City Manager Mike Gleason introduced the item.
Mr. Holmer moved, seconded by Ms. Bascom, to approve the
Hearings Official findings and recommendations of July 28,
1988, and to approve the improvements on Shadow View Drive
(Job #2399) as presented by staff. Roll call vote; the motion
carried unanimously, 5:0.
XI. MINUTES AND RECOMMENDATIONS OF HEARINGS OFFICIAL AND APPROVAL OF
IMPROVEMENT PROJECT (WILLAKENZIE ROAD) (JOB #2407)
City Manager Mike Gleason introduced the item.
Mr. Holmer moved, seconded by Ms. Bascom, to approve the
Hearings Official minutes and recommendations of July 28,
1988, and to approve improvements on Willakenzie Road (Job
#2407) as presented by staff. Roll call vote; the motion
carried unanimously, 5:0.
e XII. FINDINGS AND RECOMMENDATIONS OF HEARINGS OFFICIAL AND APPROVAL OF
IMPROVEMENT PROJECT (RIO GLEN DRIVE) (JOB #2347)
City Manager Mike Gleason introduced the item.
. Mr. Holmer moved, seconded by Ms. Bascom, to approve the
Hearings Official findings and recommendations of July 28,
1988, and to approve the improvements of Rio Glen Drive (Job
#2347) as presented by staff. Roll call vote; the motion
carried unanimously, 5:0,
XIII. FINDINGS AND RECOMMENDATIONS OF HEARINGS OFFICIAL AND APPROVAL OF
IMPROVEMENT PROJECT (SPYGLASS DRIVE) (JOB #2385)
City Manager Mike Gleason introduced the item.
Mr. Holmer moved, seconded by Ms, Bascom, to approve the
Hearings Official findings and recommendations of July 28,
19P;8, and to approve improvements on Spyglass Drive (Job #
2385) as presented by staff. Roll call vote; the motion
ca~ried unanimously, 5:0.
e MINUTES--Eugene City Council August 8, 1988 Page 15
e XIV. APPOINTMENTS TO HUMAN RIGHTS COMMISSIONS
City Manager Mike Gleason introduced the item.
Mr. Holmer moved, seconded by Ms. Bascom, to appoint the
alternatives to fill the vacancies on the Human Rights commis-
sions and complete the unexpired terms as outlined in the
staff memo. Roll call vote; the motion carried unanimously,
5:0.
XV. CITY COUNCIL MINUTES: DINNER/WORK SESSION OF MARCH 14, 1988, APRIL
25, 1988, AND MAY 9, 1988, LUNCH/WORK SESSION OF APRIL 13, 1988, AND
JUNE 13, 1988, MEETINGS OF APRIL 25, 1988, MAY 23, 1988, AND JUNE 13,
1988
City Manager Mike Gleason introduced the item.
Mr. Holmer noted that the council is acting on minutes from March and April.
He said he hoped the council can get a more prompt return on its minutes in
the future.
Mr. Holmer moved, seconded by Ms. Bascom, to approve the City
Council meeting minutes of March 14, 1988, April 13, 1988,
April 25, 1988, May 9, 1988, and June 13, 1988.
e Ms. Ehrman said she had heard that one of the minutes recorders had resigned
leaving upwards of 11 meetings to be completed.
Roll call vote; the motion carried unanimously, 5:0.
The meeting was adjourned at 10:06 p.m. to August 10, 1988.
Respectfully submitted,
~/..~
... . .,' ~~':'f'<a r....l
Micheal Gleason
City Manager
(Recorded by Todd Nissen)
mncc 080888-730
e MINUTES--Eugene City Council August 8, 1988 Page 16