RECORD OF THE PROCEEDINGS

OKANOGAN COUNTY BOARD OF COMMISSIONERS

March 28, 2017


The Okanogan County Board of Commissioners met in Regular session on March 28, 2017, with Commissioner Branch, Commissioner Andy Hover, and Laleña Johns, Clerk of the Board present. Commissioner Jim DeTro away attending personal business.

Commissioners convened the board at 8:15 am.

Alan Fahnestock member of the public taking notes arrived at 8:15 a.m.

Update Superior Court Judges- Dennis Rabidou Judge Rawson

Mr. Rabidou updated the board on the parent representation program looking good for approval by the legislators. Commissioner Branch stated when he spoke to Rep. Maycumber she told him she has been in support of this for a while and the other legislators of the 7th district have been as well. Mr. Rabidou spoke to Senator Hawkins about it and he is as well. The BECCA funds are a concern and may be reduced and moves 14.7 million BECCA funding which would eliminate our BECCA funding. He has been contacting our legislators about it being in the house budget and looks like it is there. Mr. Rabidou explained it is a truancy funding for youth and supports truancy monitoring. Commissioner Branch asked how much Okanogan County would lose and it was thought around $60,000 but not sure exactly. It is in the house budget. The plan wasn’t to eliminate the funding but rather to appropriate it but there was no guarantee of that. Anything the commissioners can do to preserve the BECCA funding would be good. Commissioner Branch explained he would discuss it as he attends the legislative steering committee meetings in Olympia. The need to know where our best interests are when they start negotiations. Approved bill 2449, but Senator Hargrove retired but still working contacts. Mr. Rabidou asked if our county lobbyist could talk to the right people and establish some dialogue. Commissioner Branch asked if the cities contribute any money to this. It affects the cities and that conversation should be initiated as it affects them in the end too.

Judge Rawson discussed the guardian ad litem program and what concerns he has with the legislative changes.

Budget concerns in Superior Court were discussed. Commissioner Hover stated he asked the Sheriff and Jail to give him what they thought their realistic budget fix would be. Commissioner Hover stated we don’t have a lot of money but asked for the same information for consideration and said he would like every department to have the same opportunity. Revenue coming in is critical and so that scenario should include potential revenue or potential income for the department. Mr. Rabidou stated superior court doesn’t have much revenue as the Clerk brings in most of the revenue into that office. Mr. Rabidou stated the commissioners never finished their discussion about Superior Court budget and they didn’t give an opportunity for them to finish the discussion. Commissioner Hover stated he cannot promise anything but would like to know what the bare bones is. Mr. Rabidou stated they are very conservative with their budget requests and noted that trials have a tremendous impact and guessing done to the best they can but trials are unpredictable and hard to know. They don’t’ over inflate their budget, but deal with the outer layers as they come up. Commissioner Hover replied that this is based on trust that the department will consider the bigger picture. The board is thinking about a bottom line budget but it will be based on developing trust with the departments. There is a little bit of control factor the commissioners have, but is usually after the fact when it should be right up front. Commissioner Branch stated this budget is exceptional and there are many issues they will need to address to put things back into line. Commissioner wish to afford all the departments time to hear and listen to what can be done. Judge Culp stated it is fair to expect departments trust.

Director Huston came in around 8:55 a.m.

Mr. Rabidou provided the board with a list of vehicles they wish to purchase. MR. Rabidou stated they need the vehicles right away. The Luminas have an issue with the airbags the passenger airbags flap blocks glass and are broken and do not function. He was hoping to get more time with them but they do not have replacements. The parts cannot be purchased to replace. Commissioner Hover stated he will need to check with the auditor and believes there is $31,000 cash in the vehicle reserve fund right now. Judge Culp explained who uses the vehicles.

The Clerk explained that the Treasurer and Auditor should be aware of this and the clerk explained to Commissioner Hover the process for purchasing the vehicle stating that the department receives three bids for the type of vehicle they want come back to the board with the three choices for commissioner award. The commissioners approve the purchase the department purchases accordingly and provides the invoice to the Clerk of the Board to pay from the Vehicle reserve fund.

Commissioner Hover asked about the listed vehicle needs. The three Luminas should be replaced first, but the van and expedition can wait. The three Luminas are critical. They are expensive to maintain.

Mr. Rabidou stated his plan is the use the state bid list for selection of the vehicle. Commissioner Branch asked if they provided the lowest prices. Mr. Rabidou thought so. Previously the local businesses also provided maintenance packages. Commissioner Hover stated he would prefer to go locally and believes the maintenance packages would make a difference. Mr. Rabidou explained the state contract may offer cage packages. Judge Rawson sees that lifetime warrantees for drive trains is attractive. Commissioner Hover stated if they don’t need to then he would prefer to go with a local business. Judge Culp discussed sales tax being local and that there are three dealerships in the county so that would be doable.

Mr. Rabidou thanked the board for the opportunity to discuss these issues. Commissioner Hover stated the Jury Management position is on the table. He and Mr. Rabidou sat down and went over the figure and that there is a savings do to having the Jury Management position filled. The position and who fills it was discussed to put a dollar value on the other half of the benefit package. The only thing he said is in the way is the county policy and that bugs him and wished he could amend the policy in a way that works for these situations. Commissioner Branch stated we have a tight schedule this morning. Judge Culp stated he likes that this issue be kept moving as there are only three months left.

Lobbyist Legislative Update Jim Potts & Associates
Jim Potts and Zach Kennedy provided their legislative update. The house is thinking about passing without any additional funding. They are not sure how that will look but believes going out to June. They are still working on the water stuff. The water issue ultimately affects everyone. Ecology wanted to kill the bill on a fiscal note stated Mr. Potts. Legislators are committed to getting something done. Commissioner Branch stated the additional fees ecology would charge are real concern. Mr. Kennedy mentioned that it sounds like a rework of the bill to include local option and it would the county responsibility and decisions whether water is there or not. It would give the county the ability to continue to develop. The county would be sued rather than the state if adequate water is actually not there for a development. Maybe we should defund ecology to fund this. Director Huston asked if there was discussion about water banking and exempt wells or any discussion about tearing into that. Mr. Potts is not certain and the discussions are not in the open. Director Huston stated they’ve tried to get paper water off the books and they have discussed water banking. They must consider the Foster decision stated Mr. Kennedy. Mr. Potts said the legislators are interested in a fix to keep development going but really must see how they will address the issue because ecology wants to kill it with the fiscal note. Ecology just doesn’t want anything to do with it as it is very expensive and wants to put the burden on the county to identify adequacy.

Commissioner Branch said the county does have some requests regarding the Parent representation program is a budget item to be negotiated. Commissioners thanked the lobbyists for their time.

Staff Pre Discussion Regarding Maloney & O Neil –Debi Hilts and Tanya Craig
Introductions were made Shawn Cicilia with Maloney and O’Niel.

Mr. Hilts provided information on current health coverages for Prosecutors office Premera, and the non-bargaining explaining that if the non-bargaining joined the 17 already on Premera. They would need a full census of people that would join.

Discussion Maloney & O’Neil Health Insurance –Shawn Cicilia
Ben Rough, Perry Huston Leah McCormack Pam Johnson

Mr. Cicila explained initially this meeting was set as a meet and greet so a further discussion could happen in the future when more time is available.

Mr. Cilcilia provided a packet of information with current insurance trends in the market. Mr. Cicilia discussed some changes that might come back around. An Aliant company since 1947 and they are large but local. He is out of Spokane. Been servicing our account for over a decade and represent law enforcement and firefighters trust and has been very positive program for those folks. They are independently owned.

There used to be several options but that has been changed through the years. He explained the high deductible plan. (attached)

In January 1, 2017 Premera stratified their network Prime network and heritage network was explained. Providence was negotiated back into the plan. Preventative care is covered in full with the largest network of doctors.

The census data would be needed for those who would be enrolled in the future and added to the head count and could change the rate. Premera did not wish to renew our reduced group of 17.

Asuris was discussed as a good carrier and do a good job, but did not provide a quote in January. Premera did renew with a 36% renewal increase on the Prime Network. He said they may have an appetite for renewal with added members. Asuris would have released a quote and could be interested again if competitive. There are other choices to consider, but these two are going to be the best access.

UW is contracted with Premera Blue Cross for Prime and Heritage. Mr. Cicilia explained some will bargain out of a contract then bargain back in once they have some experience. Evolution is not uncommon.

Mr. Cecilia discussed employer provided Life and AD&D and Long Term Disability and voluntary benefits. Short term disability is also provided.

Health care reform was discussed but everything changed recently on the federal level do to disagreement. He believes this will come back around due to some folks having less choice to procure insurance and that is happening everywhere and is very expensive even with subsidized coverages. He went over some of the draft language that may come back regarding employer shared responsibility penalties. He discussed the Cadillac tax and how that would have affected entities and that was kicked down the road to 2026. He believes something will happen and whatever does happen he feels it would be beneficial to the county with a bill everyone can live with.

Mr. Rough asked about medical insurance and is curious if it has been discussed about a composite plan with one flat rate for a family where individual coverage is more but the family is cheaper. He is also curious about the rates for individual as he shopped around downtown and rates are much cheaper. Commissioner Hover stated the average of everyone’s age determines the rate for those plans. Is there a possibility of individual policies rather than a group policy and doesn’t’ know if that is possible. Mr. Cecilia explained that has not been done. He can look into the other request for composite rates. It can cut both ways. Premera doesn’t like to issue composite rates. He will check on the individual rates cost versus family rates. Mr. Rough stated many employees are going shopping to get a cheaper family rate. Commissioner Hover stated he cannot afford to put his family on the county plan so he understands Mr. Rough’s concern. Mr. Craig stated the individuals without families outweigh those with families or those with families they have purchased insurance elsewhere due to county cost.

Mr. McCormack said part of the problem is that the rates never come back until October during budget crunch time so if possible can the info be available at the latest in early September. Mr. Cecilia stated he was fortunate to get rates from Premera at all and only gave him 30 days. For small groups Premera generally gives 60 days but Mr. Cecilia did request 90 days. Census data would be helpful to rerating and final enrollment can be considered and how they can revise the renewal. Ms. McCormack stated one problem with Premera is that they say there will be a 26% increase then there is a lot of shuffling then at the end of that they give the actual increase of only 11% so it is difficult to budget for that.

Mr. Cecilia appreciates the commissioners’ time.

CANCELLED Commissioners’ Staff Meeting

Discussion Brewster Hospital Dist #1 -$4 Million Bond Request- Brewster Hosp. Co. Finance Com.
Leah McCormack began by introducing the county staff Cari Hall Laurie Thomas Pam Johnson

She stated she asked the Brewster Hospital to come discuss their request with the commissioner.

CEO Three Rivers Hospital explained this will be a presentation and discussion about what they are trying to accomplish. He introduced the folks around the table. Tracy Trable, Vicki Orfford, Agular, Mike Prewitt, John Dollan, Rick Rhodes, David Hiack bank financing, mellony meadows.

Packet was provided of the coastal community bank and three rivers hospital packet.

The CEO explained that across the county it is difficult for the hospitals. The building has some deferred work that is part of this discussion.
The building does have good bones and it is a 70 year old building with not much done to it. Over time there are needs for repair to keep it viable. Due to some financial issues those costs have been deferred and have gone on for years. He arrived about three years ago as CEO. At that time they were in about $3 million on registered warrants. A committee analyzed the needed and set about discussing those needs with their board. One effort was a voter approved bond. They were advised by their attorney that it would be difficult to find funding so they tried to get a voter approved levy and lid lift and were able to get the levy lid lift but not the other. The out of the box thinking was to pledge the levy lift for a bank loan to do the improvements at the hospital repair the roof, HVAC, emergency room relocation. That has been a long process with the financial but they are vetted thoroughly. They did pay down their warrants and were less than $200,000 last July. They did have a hiccup with a surgeon who was part of their bigger revenue stream around July 2016 so they had to go back to the drawing board to find another surgeon and they did. They secured an orthopedic surgeon so rebuilding their orthopedic surgeon line and demonstrate to pay down. They believe that sooner rather than later they will come off registered warrants, but in the meantime their building still needs to be repaired. The McInstry representative stated he has evaluated the building and the changes do need to be done for the safety and health of the patients. They need to draw down on the loan to pay for the construction costs. Consulting with Treasurer the concern with being still on registered warrants how can they still do this and create a mechanism to access the funds and allow them to pay those they need to pay. Treasurer stated it was problematic is because this would not be voted that the county general fund would be registered and becomes part of the investment it would be registered and interest paid on it. It is not a separate fund. CEO agrees with that and their intention was to pledge that to the loan. What they are asking is if there is any way the county can help them with the viability of the hospital and enable them to pay down their warrants. IF the building is falling down they cannot provide the care the revenue comes from that. They want to be fiscally responsible going into the future so the building improvement will help them get the revenue they need to pay down the registered warrants.

The bank explained how the bank analyzed the situation and comes back with an 80%. If the facility were to come into default the USDA government would cover 80% of the debt service. The total debt service and total would be $4.3 million with a variable rate around 5%. He said it is Prime (3.75%) plus 1.25%. The CEO stated they wish to be responsible with their fiscal responsibilities and ensure they are taking care of the building itself. They have regulations that require a certain best practices standard so the state has confidence the patient has the best care. If they perceive the building is not up to those standards they can shut them down.

Perry Huston asked about the loan going through underwriting how important was it that the county continue the registered warrants. Ms. McCormack stated as of this morning it was around $830,000 with another AP run soon. The face value is $818,000 or so with payroll and AP going through Thursday so it would increase. Three Rivers stated there are revenue coming in too that would offset the AP and payroll. The Bank said they are aware of the registered warrants and it is a form of borrowing and they have looked at that back ward and forwards in the books of the district they know they are there and believe it will be a good day when those are paid in full. The loan would still go through knowing that that hospital is still on registered warrants. The Treasurer could stop the registered warrants, would that affect anything? Commissioner Hover explained that registered warrants were at $3 million and trended down to a point. If the county did not register the warrants the hospital would still be responsible for paying down the loan. If the county capped the registered warrant at $2 million how would that affect the situation? Treasurer stated she wanted to cap it down further. The payment on the loan would be affected and registered warrants would ultimately be affected as well and increased. Commissioner Hover understands the social ramifications of it and the burden on the tax payers on a non-voted levy. At face value it appears the 80% sound good being covered. The bank hasn’t’ been in that predicament yet and would ultimate have to back it if the hospital defaulted. They are designed to do the things banks cannot and will not do.

The CEO explained that due to the loss of the surgeon revenue they knew registered warrants would go up, but now that they have a new surgeon and the other one coming back online they are confident this stream of revenue will grow along with their other service revenue. They see registered warrants as a short term solution and believe that it will turn around in relatively short time. There are other purchases that can be deferred. Commissioner Hover asked what the goal to pay down the registered warrants was. CEO replied it was to be off by December 2016 and they were on that course to meet that goal but due to the surgeon situation they couldn’t. They are continuing the same expense control and at the same time growing their business. Commissioner Hover asked what the yearly payment of the loan would be. It would be interest only for a few years and once amortizing over a 30 year period with year one through three around $300,000. 2019 would be their building year and increase net revenue by $40,000 per month they would be off by the end of the year. But 2019 is the projection to be off registered warrants.

Commissioner Branch asked if there was anything that would hinder their plan. CEO replied the affordable care act is still in play and overall it has benefited hospitals but not as much due to demographics as some do not qualify for insurance. For those who are on insurance Medicaid and if that remained it would be a positive outcome for the hospital. They are with the State of Washington to increase Medicaid. It has made it through committee and must go through several more steps that will increase the payments to the hospital for those care groups. It is a short term positive but if there is a repeal of ACA that would cause a problem across the board. There would still be coverage for the most indigent and that is who they see mostly. They are already used to it and adjusted and worked into their business model.

Commissioner Hover noted that Brewster is the last hospital on registered warrants and they have been on them for many years. Treasurer stated they have only been off two or three times over a 15 year period. There is no one fund of the county that lends money it is a pot of money that all entities deposit into as surplus cash the treasurer invests and charges 3.75 interest and that interest goes into current expense. There are many districts that pour into that pot of money and could be a problematic if the hospital fails. Schools also can be on registered warrants and have asked. They found another way to pay their bills. Treasurer asked what the daily average bed count is. It is 4.6. Commissioner Hover asked if this is a burden on the county and end registered warrants in three years and what happens to the county. It doesn’t put the county in a bad position but it is about treating everyone equally. A letter did go out to the hospital from her for a plan to be off registered warrants and they are still on them. Commissioner Hover stated it appears there is still an aggressive approach to coming off registered warrants, but we are capping it and taking them off on a certain date, and that puts the burden of the business onto the hospital to pay their payroll, but seems with the numbers they are confident about being off by 2018. There is the possibility for the treasurer to say we are capping the registered warrants and being off by a certain date. The bank person said the loan does talk to that and an alternative is there they are ready to take the first step for the $4.5 million. It is a big deal for their little bank in Everett Washington and they like hospital lending and really likes Three River Hospital. USDA has looked over everything they have done and wants to see this up and rolling. CEO hopes that the county sees as part of the big picture is that their hospital administration wants to be off registered warrants. Commissioner Hover reiterated that the county treasurer could say the hospital must be off registered warrants on a finite date. CEO stated because it is a critical access hospital that a special designation by the government that the funds come back to the hospital so what they are doing makes a lot of sense. The alternative is catastrophic. They do not want to wait until the roof collapses to do something about it. They want to be proactive. Treasurer McCormack asked if the roof could be replaced without moving the ER. McInstry representative stated that it really is to improve the overall perspective by the families visiting the hospital and the roof is tied to the HVAC equipment and that would need to be removed before the roof can be done anyway. Treasurer stated moving the ER, repairing the roof and HVAC she has heard this before. He replied that all those things are way overdue for replacement and those things are failing. Treasurer McCormack stated so are the counties. Commissioner Hover stated it is intrinsic to the operation. It makes more sense to do this as a package. Commissioner Branch stated we have been through this with the other hospitals are there any difference. North Valley was on registered warrants and were in the $4.5 million but the voters voted in favor of the bond and was the same with Mid Valley and that is the biggest difference is that they were voter approved to pay their bond/loan, replied Treasurer McCormack. Those funds are restricted.

Update Public Works –Engineer Thomson, Admin Rough
Josh Thomson, Ben Rough

Commissioner Branch explained he is going to the community development meeting the Tribe is holding in Nespelem this afternoon. He wanted to make sure to participate and will invite them to inquire of Public Works with concerns and open the communication channels up to keep each other informed on the others projects.

Josh Thomson updated the board on maintenance and road conditions. There was only four hours overtime.

Peter Dan Road issue has no new information to report on. The conditions are still bad and would appear it will take around $2.5 million to fix. The original project of the CCT rebuilt the road in 2009 but they never closed the project out and kept it open to stabilize the slopes. They intended on designing a fix with the funds they have but that has not been confirmed. Engineer Thomson needs to confirm that to know if the county must begin securing funds.

Summer Road is a short primitive road and 8 loads of gravel was put down in the worst spot, but they are trying to minimize the damage. The road manager in that area was in contact with the complainant off and on.

Highway Bridge south project information submitted in record time to get started. He was commended for that at a peer meeting as it was approved. We do a good job on the work which shows and the next project considers that.

There is an appreciation of our response time and that is a big part of it. Engineer Thomson is willing to explain why projects are a priority. Commissioner Hover asked if we could find out the time frame for the highway 153 bridge replacement or structural repairs. Four will have structural repairs two by gold creek and one above and one below what will be repaired this year. There is no money for replacements so structural repairs will be done. They are really rough.

B-3 and B15 bridge replacements were also approved quickly and those projects are moving along. Goal is to have them paved by late spring.

ORV and WATV were updated on the Public Works website. The maps and lists of roads were uploaded.

Motion Resolution 53-2017 Surplus of Hubbard Property
Commissioner Hover moved to approve resolution 53-2017 surplussing real property known as the Hubbard Road Property to the needs of the county and asking the County Treasurer to sell at an auction. Motion was seconded, all were in favor, motion carried.

Motion Resolution 54-2017 Surplus Property Demolition
Commissioner Hover moved to approve resolution 54-2017 surplussing a small building on the Fairgrounds to the needs of the county and authorized its demolition. Motion was seconded, all were in favor, motion carried.

Motion Resolution 55-2017 Surplus Chevy Pickup with Snowplow
Commissioner Hover moved to approve resolution 55-2017 surplussing a Public Works Chevy Pickup to be sold to Fairgrounds Facilities fund. Motion was seconded, all were in favor, motion carried.

Approve Consent Agenda
Commissioner Hover moved to approve the consent agenda items 2-10, except for item 1 removing it from the approval. Motion was seconded, all were in favor, motion carried.

1. Approve Commissioners Proceedings March 20 & 21, 2017
2. Bid Award PW Sander –Norstar Industries
3. Agreement –LTAC Funds-Omak Stampede
4. Agreement –LTAC Funds-Cascade Loop
5. Agreement –LTAC Funds-Methow Valley Chamber Music Festival
6. Agreement –LTAC Funds-Twisp Visitor Center
7. Agreement –LTAC Funds-Twisp Chamber of Commerce
8. Agreement –LTAC Funds-Vintage Faire
9. Agreement –LTAC Funds-Merc Playhouse
10. Resolution 51-2017 Budget Adjustment Building Dept.

Commissioner Hover moved to adjourn at 12:21 p.m.

NOTE: No Quorum of the Board after 12:00 Noon

CANCELLED Discussion – ROC – Transparency – Isabelle Spohn etc…

Discussion – Investing in Development of 4-Year College- Dan Christiansen
Perry Huston

Mr. Christiansen discussed his wish to develop a 4-year college here in Okanogan County. Education is the key to lifting us up out of our economic issues. He has enjoyed his online college courses and feels the internet is a huge education piece. Fiber is a big piece to this happening. Wireless is prohibitive as too many use the infrastructure. The cost to upgrade is too much. Fiber costs run around $4500 even though it is very close. In Malott it would cost $6600 and is not possible for the average person. What are the constraints of the Fiber once it is here. Gigabit services would be ideal, fiber can deliver about 1000 megs. The source is the limiter such as PUD. There are certain areas that can offer 100 meg plan for $40. The county is very behind the times and limited to providing adequate fiber internet infrastructure. Commissioner Hover said shared services might be a thoughtful way to share the costs for businesses or groups who can pool the funds to provide the fiber. Mr. Christiansen isn’t here to be negative or blame anyone. We are one of the poorest internet areas in the state, and technology deprived.

Mr. Christiansen wants to be part of the group that brings us into the future to bring our kids up front. NEWS=North, East, West, and South. How can he get involved in more of an official manner be part of a community group to find out how to work on the issue. Commissioner Hover stated having come from the Methow there are many people there who put their mind to something and get it done. These people have a vision then make it reality. A group could be formed to get something done rally around those who can leverage those who can get it done.

Director Huston stated there are three things that must be considered before bringing in anything is housing, infrastructure, and

Getting a group with time enough to put something together. Director Huston suggested Roni Holder Deifenbach Economic Alliance who might have some groups willing to put some time into forming a group who would figure it out.

Mr. Christiansen asked how we can upgrade the internet to be able to provide adequate service so that a school would be able to offer online classes. A state institution branch of education? Wenatchee Valley College wants to dump us, we should not have to beg to have an education system. They are not flexible on the days they provide classes so a working person cannot always have the days off to attend college. The county is like an ombudsman and may sit on committees which can begin the conversation. The Clerk of the Board suggested the NW Economic Development District as a good place to begin a conversation. This is also an ADA issue for those with disabilities and without a higher speed internet service we are not able to provide the service to those who need sign language.

The small business administration product cycle has great potential in e commerce. Mr. Christiansen thanked Commissioner Hover for his time and discussion.

Leah McCormack came up to briefly discuss the financials discussed earlier today.

Public Hearing –Supplemental Appropriation Noxious Weed Will be Continued
Commissioner Hover continued the Public Hearing for supplemental appropriation to April 3, 2017 at 11:30 a.m.