Finance Highlights 2007 0207 - Laserfiche WebLink

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Major also gave an update on the current state of accounting and auditing, including GASB 45 Accounting and Financial Reporting by Employers for Post-employment Benefits Other than Pensions, GASB 34 Basic Financial Statements-and Management's Discussion and Analysis- for State and Local Governments, SAS 61 Cautionary Advice Regarding Disclosure About Critical Accounting Policies, and on other upcoming audit standards. Majors finally suggested that the City might want to explore the possibility of creating a committee structure to function as an audit committee. 2. Continued Discussion Regarding Proposed Living Wage Ordinance Assistant City Manager Hollister provided an introduction to the material prepared for discussion. Based on the data gathered, Hollister also explained that staff developed a key issue matrix containing recommendations for the Committee's review, which can be used as the basis for drafting the ordinance for the City. Purchasing Agent Brockman expanded on the following materials: 1. Public Works v. Maintenance Projects - How to differentiate and meet prevailing wage requirements. 2. City Attorney memo regarding the Applicability of Prevailing Wage Rates - where workers on public projects over $1,000 must receive the general prevailing rate. However, as long as the City has adopted a special labor compliance program, prevailing wages are not required for public works project of $25k or less when the project is for construction work; or for any public works proj ect of $15k or less when the proj ect is for alternation, demolition, repair, or maintenance work. 3. Living wage questions and responses from the cities of Berkeley, Hayward, Oakland, and Richmond. 4. Comparative matrix of living wage rates and other attributes by 6 Bay Area cities. 5. Staff recommendations on 10 key areas for consideration when developing a City Living Wage Ordinance. Council Member Stephens questioned the fundamental purpose of living wage. Brockman responded that a living wage allows people working for the City to live in the City. Council Member Starosciak also commented that a living wages help support and sustain the local community. Stephens also asked why the City is addressing the living wage issue. Vice Mayor Grant stated that the Mayor had brought the topic up for discussion a couple of years ago. Stephens asked additional follow up questions: Why do we have exemptions? And why are financial aid and non-profit recipients exempt? Stephen further commented that it appears living wage can have both a financial impact and administrative impact on the City, and possibly community-based organizations may encounter layoffs in order to pay the higher living wages. City Manager Jermanis explained that for-profit companies can typically pay a living wage rate as compared to a non-profit organization that would more likely encounter financial hardship. The general concern is to not impact the non-profit organizations. Jermanis suggested that the City have an internal policy statement that clarifies the City wants people to live well on a living wage. Human Resources Director Caire explained that living wage exemptions apply to part-time employees while waivers apply to contracting agencies. 2