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HomeMy WebLinkAboutFinance (Purchasing) FY2013-2014 DEPARTMENTAL BUDGET CALL-BACKS April 19, 2013 Finance —Purchasing(dmc) Page 1 The departmental budget call-backs reconvened on April 19, 2013 at 9:06 a.m., and proceeded as follows: Finance — Purchasing: Honorable Tim Bynum (present 9:12 a.m.) Honorable Gary L. Hooser Honorable Nadine K. Nakamura Honorable Mel Rapozo Honorable JoAnn A. Yukimura (present 10:01 a.m.) Honorable Jay Furfaro Excused: Honorable Ross Kagawa Chair Furfaro: I have not heard from Mr. Bynum. Councilmember Yukimura called and she will be late. Mr. Kagawa is excused from the morning session. It is_4 of us to start to answer your question. Looks like we will have 5 as soon as Councilmember Yukimura comes in. I am looking at a change that we agreed to — 2:30 is open today after the Fire Department. The Department of Personnel Service was moved and if they are listening, they were moved to 1:30 on Monday. So, we might have a true aloha Friday today. Mr. Barreira, are you making the presentation for Finance and Purchasing? Mayor, come right on up. BERNARD P. CARVALHO, JR., Mayor: Good morning. Ernie folks are ready to come up but I wanted to just be here, I also have something else to go to but if I may... the healthy discussion that we had,yesterday specific to the Golf Course and more importantly the credit card discussion that we had. I did take that very seriously. I think that is a big part of... and we did talk about it prior to coming to Council and so I want you to know and relooked at that again. There are a lot of different risks involved whether it is fees being assessed or not, play or not, if it is increased great and if not, we may have to look at how to cover that, and just in general. I did get our legal team together... my point being is that I want you to understand that I am very serious about this because this particular part is more of a customer service side of it and we talked about a play from our visitors versus play from our resident and assuring that there is some kind of balance. We got to be very mindful of that and`how we move forward in this discussion. So, I am taking that into consideration as well and how we look at such as if there was a ATM there is a fee to that ATM card, similar to which is assessed to the customer similar to if you go through this credit card swipe program, there is a fee. We want to talk about that and how we are going to work that and that is all I am saying. On the legal side of it, we are doing a little comparison. There are other private courses that are also experiencing some issues with amenities too, so that is another piece. I just wanted to make sure that you understand that the commitment is there, the timing with these issues and the risks that are involved in the forefront; we are looking at that and so hopefully we can get a better timelines on that. Finally, the revenue versus none-revenue and that is another piece that we looked at to assure that whatever the result is, it is in the best interest of the customer. I just wanted to say that upfront. Ernie folks are coming in with more of an overview and I know the discussion will go there as well regarding the credit card. Chair Furfaro: Mayor, maybe you have to look to Ernie on this but we have a one and a half open on our Monday schedule, will that fit for what I will post as a Finance general discussion. Will you be ready at 11:00 on Monday? You will be. Okay. To the Staff, if I can have a note made that the current window that we have from 11:00 — April 19, 2013 Finance —Purchasing(dmc) Page 2 12:30 on Monday that we will have an agenda item that talks about Finance general and credit procedures. So, noted? Mayor Carvalho: So, again it is not just the Golf Course, the bigger picture would be that we would like to offer credit card opportunities for other parts of our operation but in this particular discussion, okay, let us look at that and see how we can work through all the different details. Chair Furfaro: Mayor, I think it is only fair that I mention to you before I recognize Mr. Hooser that this was a discussion not so long ago in Parks and Recreation and I said we all understand there are fees associated business by credit card. Your discussion to make it attractive for the operator needs to be a discussion about if we are going to net out these charges from our collection because this is money that comes directly to us. Mayor Carvalho: Right. Chair Furfaro: So, that should be part of this discussion on what is now Monday 11:00— 12:30 Finance general and credit. I will put that in the schedule. Mr. Hooser: Thank you for your personal commitment to this. I know it is there and I appreciate you coming this morning. I have never been one to say the government should be run like a business because it is not a business in general. However the Golf Course, I believe, should be run like a business and I think any business watching this conversation and certainly the Golf Course would be scratching their head saying why would you not use credit cards even if there is a cost because we all do it and we all pay the same cost. Then they realize it is going to generate more business and they realize that it is good for their customers. I think therein kind of lays the problem with this particular issue with the Golf Course which is managing it like a business. Perhaps we do not want to charge fees for property taxes that we can recapture because people have to do that, the people do not have to play golf. The underlying issue of the management of the Golf Course, I think comes down to thinking about it like a business, running it like a business. One could argue that the County has unlimited resources through taxing authority, so some businesses have to struggle with their budgets, we could theoretically fund what we want to fund and still not work it. So, the credit card is a symptom the proper business management of that facility, I believe. I do not know as the head of the County whether you need to look at that — the Managers and look for some support with more business expertise or we look at bringing in an outside person Manager or company to manage it but that is the fundamental issue. I do not know if you can address that at a future time or if you are prepared to talk that now but... Mayor Carvalho: Overall, I understand what you are saying. There are different variables in that whole gem of Kaua`i — resident versus visitor play, operational wise, how we are going to manage it together because there are a lot of stuff happening back and forth and people wanting to understand the operation side. We are sorting through the different possibilities to assure that we find that balance between the visitor and the resident. It is a public Golf Course and there is much use in this particular area —there is golf, there are clubs... anyway overall... Yes, the operation side, we will look at all options and see what is the best fit to assure that the customer gets the best opportunity. Even with the study that was talked about yesterday, I did not say that we are not going to do a study in this particular timeframe, and resources that we have we want to tackle the maintenance part of it, concession part of it, and then the global piece will come. That would be unfolding what you just said on the operational side. April 19, 2013 Finance —Purchasing(dmc) Page 3 Mr. Hooser: Thank you. STEVE A. HUNT, Director of Finance: I want to address that as well. From a business perspective to taking on merchant service is a business risks to us as the own of this course. If the rounds of play are stagnant and adding the credit card convenience does not increase rounds of play then it will actually be a loss in revenue to us and we may be coming with a money bill to either adjust rates to accommodate the fee charges that we are being charged or to offset the loss the we incurred. I think it is a logical risk to take given the testimony we heard and the potential loss of rounds played. If we are running this truly like a business what you are talking about is take the most profitable customer which is the non-resident and have them play. If we limited it to non-residents, we may be could break even but I do not think that is the intent. This is an amenity that is for our residents and some of the off-island play certainly helps subsidize that but I do not think we are in this to break even or make money. We are just trying to minimize the risk and to make most available play as possible to our residents at a fee that will be responsible and to manage the course to the best of its ability to provide a great amenity. Mr. Hooser: I agree this is not a commercial golf course and local residents need to be treated better and differently and the County needs to subsidize that. I believe the operations leasing out of commercial property, running the operations needs to have a more business perspective. Given the considerations and guidelines that we as the County give that business which are to subsidize local residents. I do not think that expertise is there given from the discussions that I had so far, here across the County, it does not seem like the expertise and the ability to make those decisions are there. I need a greater level of confidence, at some point; otherwise we will keep having these discussions over and over again. I hope the Administration will recognize also at some point if it does not get better that there is some other problem that needs to be fixed. If it gets better which I hope it does in July I think we were told that things are going to be better than you will not hear from me anymore. I just hope that we recognize it if there is a problem that we have to fix it; we cannot just keep going on and on... Mayor Carvalho: We will take care of the management part of this whole discussion and be ready. Mr. Hooser: Thank you very much. Mr. Rapozo: In the analysis I would hope that and I think you touched on it, that we would consider the business risk if we do not do it. Mayor Carvalho: Yes. Mr. Rapozo: I do not golf often and I have not been to Wailua for awhile but I can tell you that I have been there on a few occasions where people have walked off— mainland people have walked off. It is going to continue to happen. It is very difficult to even gage that right now because we do not know...nobody keeps track of that. Nobody at the counter keeps track on how many visitors leave. A lot of these visitors come in as groups and they want to play and it is amazing the condition of that course, what they have done to the course. Kaua`i has always had that gem, as you call it, but when we analyze the business risk, I think we got to analyze what happens if we do not do it. We can do a pilot program and we could do a one year program with a merchant service account. Just in my own experience when I started my business back in 1996 I did not take credit cards because we did not have the volume of transactions but as we grew, I found that, yes, there was a price to pay for me to process a transaction but it was made up April 19, 2013 Finance —Purchasing(dmc) Page 4 overall with the people who paid with checks and the volume of... I mean tripled the new business because I could now do business over the phone with a client on the mainland and not having to wait for a check. I think it is going to work. I think it is going to make it better. I think we are going to increase rounds. Right now, if the guys want to golf and they do not have cash, he is not going to play. That is all I am asking —we need to incorporate that risk of not doing it. We got to have an estimate. How many visitors pay with credits would we need to offset the cost? What are the typical merchant service costs now? I think with the volume... less than 2%? Mr.Hunt: Normally when you submit a bid for getting a merchant service bid, you estimate the number of transactions you anticipate either monthly or annually of using the credit card and what that average transaction is and depending on the volume and the ticket amount, they either give you a price of a transaction price, percent, or a combination of both depending on what your thresholds are. It could be anywhere from 2% - 3%. Mr. Rapozo: Less than 2. Mr. Hunt: Normally when it less than 2 it is less than 2 plus a dollar per transaction or some combination so you have to look at the total. Mr. Rapozo: I know when I applied for mine, they reviewed and because it was such a small operation, my merchant fees were a little higher but it was ultimately my decisions if I wanted to pay the low transaction fee with a higher merchant fee or they call it rebate, I guess, versus a transaction fee. I think nonetheless even if it was up at 2%, how much is a round of golf? Mr. Hunt: It depends on who is using it—local or visitor? If you are getting the cart and the golf it is $48 typically... Mr. Rapozo: So, not much. And if we are picking up 5 additional golfers, we have more than paid... Mr. Hunt: On the flip side we have done pilots with merchant service in the past for Real Property Assessment— Collections... Mr. Rapozo: Real Property is a different story because... Mr. Hunt: Which costs over the first 6 months, we canceled it because it was $140,000 fees. Mr. Rapozo: But the difference is this Steve, in Real Property, you have a fixed number of clients. Mr. Hunt: Yes. Mr. Rapozo: You have a fixed numbers of bills that are going to be paid whether it is credit card or not... in golf, it is not. Obviously you are not going to get more customers on Real Property. Mr. Hunt: No. And the same goes for Motor Vehicle... April 19, 2013 Finance—Purchasing(dmc) Page 5 Mr. Rapozo: Golf is entirely different. In golf, I am telling you there are... Mr. Hunt: That is why I think this would be viewed as a pilot because if in fact the rounds played and the use of the card now starts to increase and we more than offset what we are paying in merchant service and we get positive numbers than great, we are all good. Mr. Rapozo: Yes, and I guess that is what I am asking. I got to believe that if you incorporate credit cards at the Golf Course, we are going to generate more business. Chair Furfaro: This is not on g today's agenda. Mayor Carvalho: All I want to say is that I am here this morning to assure you and Councilmembers those credit cards will be accepted at Wailua Golf Course in a very near future. We are working on it, we regrouped, there some risks involved but I am willing to go there because we talked about it and I think this is something we got to start. Thank you. Mr. Bynum: I was not here yesterday for reasons that are unavoidable but these issues with the Golf Course, this is not new. We talked about these things and I will not go to the credit card issue but I am really concerned about the pro- shop guy — there were issues there. We changed things that impacted his business by not having the restaurant, by not accepting credit cards, he reached out to the County, I was the Parks Chair, and I tried to do what I could. Those did not get addressed and now the pro-shop has closed. That means visitors cannot rent clubs, they cannot get tees or you know... same with the restaurant. And then the most critical thing that we got numbers are clear.commitments to... then mbe s a e c ea . We need to make visitor rounds; we need to keep those rounds up at a reasonable level. I agree with Steve, your comments that this is primarily for our residents but to keep it viable in a world class amenity, we need to generate those revenues. There was a very_strong commitment to work with the visitor industry and my knowledge is that absolutely nothing happened for a year after that commitment. Mayor Carvalho: And again... Chair Furfaro: I need to summarize this but the Golf Course is not on the agenda. Mr. Bynum: I am going to make 1 more statement and then be done. We need to set aside some tee-times for off-island people especially in the morning times. It has been a standard for years, somebody arrives on vacation, they hear about the Golf Course, they call up and cannot get a tee time until 12:30 and the entire week they are here. That is not conductive to maximizing and so as much as I think this is an amenity for visitors, to be reasonable we need to generate some of that off-island revenue. Mayor Carvalho: Councilmember Bynum, if I may? Chair Furfaro: All of those items were discussed. April 19, 2013 Finance —Purchasing(dmc) Page 6 Mayor Carvalho: We addressed all of those items and thank you. We are addressing it — concessions, all of it... We are all on the same page, yes, I take responsibility and we are going to move this—all of it. Mr. Bynum: Thank you and I appreciate you being here for many of these sessions. Mayor Carvalho: It will take time and understanding but we are going to work it. Chair Furfaro: Mayor, this is how I am leaving it; I need to recap this for those that are listening as well about their schedule. I am adding on Monday from 11:00 — 12:30 a general Finance discussion dealing with credit and collections and merchant services, specifically for the Golf Course. I also want to mention about enterprise funds, the Councilmembers talked about yesterday but the enterprise fund is a fund that covers its own expenses. Mayor Carvalho: Right. Chair Furfaro: My position is that we need to get it to a point that the loss is minimal. I am not saying that we need to get it to a profit — that is enterprise fund so that has changed. I look forward to this continued discussion about general Finance credit in collections on Monday. Ernie, you will be ready to make the presentation or Steve? Who do I put on as the person? Mr. Hunt: I can be here till about noon. I do have an appointment at noon and then Ernie will be here. Chair Furfaro: Thank you again for your presence and your flexibility on the time that I can give you on this. I also want to say that you have George Costs who has food, beverage, hotel resort experience — that gentleman sitting in the back ran the financials for a private golf course for 6 years. He is on your staff. Mayor Carvalho: I am so happy that he a part of my team and we are all working collectively to address your concerns. Chair Furfaro: And when you put these things together, please consult with some... you have some experts on your team that I think could be a little bit more collectively involved. We will see you Monday. Okay, we are going into the agenda item which was Purchasing. Mr. Barreira: Good morning. Chair, would you like me to pass the presentation and open it up for questions to help you stay on agenda or shall I present what... Chair Furfaro: No, we will do the agenda as it was planned. Mr. Barreira: Very good sir. Chair Furfaro: Do you have a presentation for us? Mr. Barreira: Just very briefly I will speak and highlight, you have the written presentation and I will not read that verbatim. I will speak to some April 19, 2013 Finance —Purchasing(dmc) Page 7 highlights within the presentation and then of course I would be happy to answer any questions you may have. I am very happy to be present for my third consecutive year to present the Division of Purchasing budget and I would like to begin my presentation by saying that this is the second consecutive year that the Division of Purchasing will come to the Council with a budget reduction in terms of our Operating Budget. Much of that can be attributable to the fact that we have entertained quite a bit of electronic procurement initiatives and other technological implementations that have saved real dollars and real time and have created a number of efficiencies. We are very pleased to help to reduce our Operating expenses in times when the economy is very challenging and we are struggling with finances. I would also from a budget perspective like the site and acknowledge the Council and the Administration as this year we set a precedent in having successfully all departmental budget presentations in electronic format which advances the Mayor's and the Council's initiatives in terms of the benefits of technologies that we try to exercise. I also understand that many of the Council has begun to utilize their ipads and other electronic resources to entertain the budget resources and so I thank you for setting that example for our people and our members of our Council. I would like to open up the presentation by talking about a few successes that we experienced in the Division of Purchasing in this FY. The first was the final chapter of our electronic contract initiative. As you recall 2 years ago and I will give some brief data for the benefit of Councilmember Hooser who was not on the Council 2 years ago. When I first entered the Council in 2010, we would execute our contract process by requiring an original contract and 4 additional copies. These contract documents as you are well aware can be anywhere from 10 pages to 300 pages. The requirements of having to mail that throughout the County and throughout our County contractors created a tremendous amount of costs and inefficiencies for those involved. To make a very long story short, throughout the course of my 3 years here at the County, we have incrementally addressed that problem by focusing on electronic transmissions of those contracts and on fully executing those contracts via electronic means. The final stage of our electronic contract initiative was the development of the electronic contract portal. That n ow resides on the Division of Purchasing website and it is accessible to all authorized departmental and agency personnel who have been granted that access by their Department Heads. They can access that and do anything they need to do with that contract without having to contact the Division of Purchasing or having to make the physical visit to our Office to acquire that information. So, it is completely electronic. We work very closely with the County Attorney's Office during this initiative to identify only the requisite documents that constitute a contract file so that we can truncate that file and make it more efficient to research and utilize those documents within that file. So, my thanks go out to Mr. Castillo and First Deputy Amy Esaki who were instrumental in helping us move in that direction. Essentially, if you would like to look at the contract portal go to the Division of Purchasing website and you can find it in our portal. It has created a large number of efficiencies for all involved. Keep in mind, I know there is great frustration in terms of the requirement that we still have to maintain what signature documents on certain legal documents but the benefit of having the electronic file is that it simply provides great accessibility for both the Division of Purchasing Staff as well as our internal and external customers. The second initiative that we rolled out this year successfully was a further broadening of our professional services electronic procurement process. Every year by rule and law we are required to advertise all of our professional service needs for the forth coming year. That in the old days was done by posting an Ad in the paper of general circulation identifying all of our professional service needs for the year and inviting the submission of hard copy resumes, multiple copies as well as letter of intent. 2 years ago we streamline the process by using our Division of Purchasing website to post the Ad on the • April 19, 2013 Finance—Purchasing(dmc) Page 8 internet as opposed to hard copy. That was part of our $20,000 Operating budget reduction by eliminating all our hard copy advertising and deferring to our electronic procurement system. This year we rolled that out even further. 2 years ago we still required the submission of resumes and letters of intent in hard copy form, this year we revised the process by not only letting the solicitation electronically but by also inviting the submissions of resumes and letters of intent electronically as well. Mr. Erwin Wright, our technological lead and Operations Manager within the Division of Purchasing created a scenario whereby we give specific instructions to the Professional Contractors to subject head that E-mail using a certain documentation so that when those transmissions are received by our COK Purchasing@Kauai.gov site, it automatically deposits those resumes and E-mails into a special file that are held in that location until the bid opening. In years pasted, I have to explain to you that, we would compile equivalent of your table of resumes and letters of intent in hard copy format because they would have to come. The agency personnel would come and pick up those documents from us in order to transmit it to them. Not to mention the extremely high cost for our contractors in duplicating those professional resumes and expending the postage involved and having them sent to us. The process today is that everything comes in electronically, we record them, and document them electronically on Excel spreadsheet applications, and we then forward these documents to our users without any type of paperwork being exchanged. This has created the type of efficiency that we need to acquire to save money and make us more efficient and it has been a tremendous gift to the professional service contractors who have been the beneficiaries of these costs and time savings. They are very pleased. Very quick accomplishment for 2013 as some of you know this and some of your do not... after 18 months in our temporary Office space, we finally facilitated a successful renovation of the Division of Purchasing Office. We are thankful to Mr. Doug Haigh in Public Works. We piggybacked off of a FEMA project where funds were appropriated to facilitate a wall and window hardening project within the Division of Purchasing. We piggybacked on that project by identifying our renovation which involved painting the walls and ceilings, replacement of VCT and asbestos laced tile within the Division by replacing that with carpeting and by identifying specking out and procuring corrected furniture. We also reconstructed the mail room to create a separate mail and bid opening facility which was desperately needed by our Staff to provide the resource during bids openings and to deal with Staff meetings and individual meetings. We are very thankful once again the funding for that initiative did not involved any new appropriation by this Council. We identified that year about $60,000 in cost savings as a result of our electronic and technological initiatives and we approached the Council and the Administration to support us in expending about $32,000 of that savings in order to accommodate that renovation. So, we are very thankful to you for supporting that initiative. If you have not seen the Division of Purchasing renovated Office, please come by, money did not permit a formal opening, we can a very polite and calm prayer service — few pupus that I paid for... Chair Furfaro: I got a cup of coffee when I came by. Mr. Barreira: Terrific. We try to be as hospitable as we can. I would also like to extend aloha to Chief Westerman. We were the first occupants during our renovation in a new Fire Admin building upstairs. They were very hospitable and inviting us to be there for that 6 months. It was a very nice place to work. Very nice facilities and the Chief was most hospitable. So, my thanks to the Chief and his Deputy as well as the entire Fire Admin Staff for accommodating our state. Special thanks to the very special people that make up the Division of Purchasing. They relocated twice during the same fiscal year in order to accommodate the renovation and to find a place to work. They did not miss a beat, did not miss any deadlines and it speaks to the quality of the people that I am fortunate to lead within the Division of Purchasing. The final success that I April 19, 2013 Finance —Purchasing(dmc) Page 9 would like to touch on today is that over the past two years the Division of Purchasing successfully led more than one hundred formal procurements not to mention the five other major procurements that we entertain and the result of those procurements have been millions of dollars infused to our economy and the acquisition of good service and construction that are vitally needed not for our Departments but for the people that we serve. In that regard, we continued to issue and execute about 200 contracts for Good Services and Construction every year. Chair, as I sat here for 2 weeks and listened to all of the budget presentations by all of the Departments and being very impressed with what we have done, I could not help to think if people realized where all that happens? Where all the Goods and Services and Construction and all the professional services —where all that begins? And if I may take a moment to give proper praise and recognition to my Staff. Every dollar that is spent in this jurisdiction begins at the Division of Purchasing and those 8 people do remarkable things with the millions of dollars that we successfully procure every year to create those resources that are needed by our people who become the beneficiaries of those various goods and services. So, I would like to extend my aloha and thanks to these very special people who put forth a tremendous effort every day of their working lives to make this happen. I had a pleasant exchange with Councilmember Yukimura 2 days ago and I think she wanted to scold me because she said the lights in your Office are on early in the morning, late at night and on weekends. I said yes, that is true. Those are the procurement personnel that have put in the kind of time that they need to make up for the shortage that we are currently experiencing to meet all the responsibilities that are placed upon us. So, while we are spending a little bit of electricity, there is a beneficial outcome of all of the resources that are being provided. Chair Furfaro: I would like to say something. Oh, you thought he was done. Okay, you still have the floor. Mr. Barreira: Our biggest challenge this year was actually our greatest accomplishment. For the first time in many years the Division of Purchasing actually experienced unanticipated attrition problems. It was unanticipated because we loss 50% of our procurement staff—of our specialist staff and these are our college graduate class of employees that handle all of the formal procurement, working in close coordination with our technician staff that provide vital services as well. One was loss from an internal transfer and one was loss to an unanticipated departure from the island. The loss of these two specialists represented 30 years of collected procurement experience that you simply cannot replace overnight. This was a shock to us but survivability becomes a key element. Fortunately, the Council appropriated a position to us last year which became available to us in January of this year. We filled 2 positions with 2 outstanding young professional women. The positions were filled in February of this year. We have 1 position remaining that was created by the departure of our Senior Specialist. I have to tell you that what was ironic about this recruitment which is unheard of, is there were two positions and only two applicants and yet these 2 applicants were outstanding. In my 27 of doing government recruitment, I have never been more impressed than with these two young women. They came to us as educated, motivated, energetic, and they are willing to hit the ground running and are eager to assume responsibilities of procurement. We are very encouraged with these two young ladies and we have very high praise on what they will be able to do. During the course of this recruitment Council, I need to tell you that there were no holds bar, we made it very clear to these applicants that I have 2 Senior Managers — Florence Kakuda and Erwin Wright who have given me... I have been blessed with early notification of their retirement intentions in 2015 and 2016, they are going to retire. So, in the process of this recruitment, I was able to make it very clear to these new applicants that our goals April 19, 2013 Finance —Purchasing(dmc) Page 10 and objectives is to bring on a Staff who will be able to learn the skills, the art and science of procurement and be able to provide us with the level of continuity of services that we are going to need to maintain the level of service the we currently have today. So, we are very eager and optimistic that these 2 young ladies and the rest of our procurement staff are going to step up to that level and perform as we accept them to perform. I would be remised if I did not at that time in terms of that recruitment effort Chair, giver proper praise and recognition to the newly formed HR Department. During the course of the recruitment from development of class specifications and positions descriptions through the creation of the list eligible's, to the expedited process that was followed in clearing these individuals, to be able to start work with our Division — the work was nothing sort of outstanding and I am very thankful to the new leadership within HR and the Branch Heads within that Division. The vision for the future has not changed. I am still and fully committed to rolling out a fully integrated electronic procurement system. We have a new ACPO (Assistant Chief Procurement Officer) in Hawai`i County who was recently hired, and of course Mr. Greg King on Maui who has been there for quite a few year. All 3 of us are looking at the same public purchase system that we have talked about last year which as you recall is the free system which that is made available to government entities around the Country who can utilize the fully integrated electronic procurement system. I have not moved away from that goal in the objective, I had to defer further implementation of that initiative because of the critical manpower shortage and the need to bring us back to par. We continue to make extensive use of our internally designed electronic procurement system and we have continued to tweet the application of that process. The latest change was of course allowing bidders to only submit to us the requisite documents that mandate a formal offer which is about 4 or 5 pages. In years passed we had them submit 40 or 45 pages to us. So, it has made the been opening process far more efficient and saved our bidders money in terms of postage and it has allowed us to process the bid openings much more efficiently. We are going to continue to move in that direction and we anticipate doing a graduated integration so that there is a clear understanding of how that initiative will work for our internal and external customers. We are very blessed to have a very good relationship with the Contractors Association of Kaua`i under the capable leadership of Karen Taketa. They have made themselves available to help us pilot the graduated roll out of the new procurement system and that means we may well start with construction bids when we implement the system in a graduated fashion. The final initiative I would like to talk about that I know is very important to this Council is in terms of procurement training—we had some findings this year in terms of pcard utilization and most of these were minor but there still were findings, I believe we had 15 findings on a 40 sampling which is significant. What I did immediately after that was issued an interim training memorandum to all departments and agencies which I shared with the Council clarifying and highlighting the requirements of procurement as it pertains to the pcard. I have almost finalized my PowerPoint formal training presentation which I will be conducting prior to the end of the FY with Department Heads, Deputy Department Heads, pcard holders, and fiscal personnel which will be a more formal training on the utilization of pcards and the procurement responsibilities that are aligned with that pcard use. I will also continue to do subject matter gold directed procurement training for departments and personnel as they articulate needs based on their operations. In my 27 years in government, I found it not particularly useful to bring in a 100 people and do generic training on a topic that they may not be particularly interested in. I continue to provide focus training on different procurement methodologies as the needs are conveyed by the Departments as well as continuing to provide new employee personnel training for people who are hired and who are going to be involved in the element of procurement. April 19, 2013 Finance—Purchasing(dmc) Page 11 I would like to close my presentation by talking just briefly about succession planning which has been a big issue for the Council as well as for the Administration. I have highlighted my succession prospective quite detailed in my presentation so I will not go into great detail, I will just highlight a few items. We have a tremendous challenge in the public sector with succession planning and the Vice Chair and I have talked about this on a number of occasions. Unlike the private sector, when attrition occurs, for example, as it results of retirement, we cannot simply hand select the successor, 95% - 99% of our employees are Civil Service. They enjoy the benefits of that system as defined by law. Every time there is a vacancy and a promotional opportunity, every employee in the public sector that can meet the minimum qualifications of that position is entitle to apply and be given full and fair consideration in an objective and neutral recruitment process. Unlike the private sector where we can simply hand select. The other challenge in the public sector is employees are not required to provide minimum notice on a retirement intent. They could retire as quickly as 2 weeks from the time of the intent is conveyed and as the Managing Director pointed out 2 weeks ago, I believe they can articulate a retirement intent on that 3 times. It does not give us time to prepare unlike in my situation where I do have the opportunity, I have 2 or 3 years to prepare but it does not mean that we cannot do a good job in succession planning in the public sector. It starts off with recruitment. As managers, we have to ensure that we clearly identify the knowledge, skills, and abilities that these employees need to possess in order to come effective components of our operation. The development of our interview instruments have to mimic those knowledge, skills, and abilities to make sure that we are measuring in our questionnaire the types of skills in qualifications that are critical for that position. When we finally facilitate a recruitment and do the scored analysis, we have to make sure that when we think we have selected someone to make sure that we check prior job references and performance standards. It is a kiss of death for any prospective employer to not check on prior job performance and references because you are dealing with a blind spot that you are never going to be able to overcome, so it is very important to do that. Once you make a hiring selection, training is critical not only to develop the skill set necessary to perform the goals and objectives but for the employee to understand the objectives and the initiatives of this department so that they can become part of achieving that mission that is critical. Proper acknowledge and recognition of our employees who work hard is a critical element of any good management plan. Jobs satisfaction is not going to be created by fringe benefits and by salary that will keep people on the job. It is not going to make them satisfied. A sense of worthiness on the job and a feeling of value that one contributes is going to contribute job satisfaction, so we have to nurture that. That also involves continued training so that the skill set and the base of skills of employees are enhanced throughout their career with the County. Substandard performance is a plague to the private and public sector. Managers in the public sector have a responsibility to identify substandard performance and attend to it either by additional training and guidance or by taking whatever disciplinary measures are available. Substandard performance becomes a major challenge for hard working employees who are forced to pick up the slack. So, we have an obligation to deal with that. Morale is so essential in every organization and we have to maintain that level of morale with good management actively. Thank you for the opportunity to present my budget, I have not gone over the numbers and I am happy to answer any questions that you might have or in terms of the presentation, or the actual budget. Thank you. Mr. Bynum: Ernie, thank you for what I consider being an outstanding presentation. I particularly want to highlight in your written about succession planning which you just outlined every Department Head should read that section. It is the most thoughtful analysis of succession planning in the public sector that I never seem and April 19, 2013 Finance—Purchasing(dmc) Page 12 I really appreciate it. I enjoyed reading it and you might want to consider expanding it because it is still kind of an overview. I got to note that many of the things you are talking about are consistent with the Leadership Kauai training about best practices and leadership about challenging the process and trying to make change. I think your pride in the work you have done shows and for good reason. My question has to do with training because I also believe that training is an essential part of succession planning and nurturing employees. You have budgets in 2012 and 2011 that had no training dollars, last year it was $3,000 and I assume you spent them? Mr. Barreira: Actually, I deliberately defer not spending those funds in order to save money to create the necessary fund balance that I thought was critical to balance next year's budget and fund balance will be an issue when we come back to you even for FY 2015. I have not undertaken any training. We have facilitated training that is available at no cost to the State Procurement Office especially for our new employee but we have not done travel related training by send staff to different resources that are available elsewhere in the Country. Mr. Bynum: My general concern overall is that when the economic down turn came, training was one of the first things that gets hit in the budget. We went a couple of years and then last year's budget was like, let us put the training back in, then this year's budget says let us take it out again. Mr. Barreira: Yes. Mr. Bynum: We are going on 3 or 4 years of not having training resources at the level that are important to do the things that you are talking about— succession planning, nurturing employees, maintaining and retaining them. Let is pretty much all I have. I just have a general concern that... and I will use the Council Services as an example, we had virtually no training here until there was leadership transition both at the County Clerk and the Chair's level. In the last 2 years at Council Services, we instituted a training plan. I hope we go further. I think employees need to... we need to nurture employees to identify training that they personally feel... that is kind of tailored to that individual person and have funds available and allow them to pursue development kind of on a case by case basis. We have not gotten there yet. I just very much appreciate your presentation and I am thrilled about the initiatives that you are taking. Thank you. Chair Furfaro: I am going to say a couple items and then I am going to step out because I have to take care of something before 10:00, okay. We would love to share our continuity plan with you. It is quite a document and it is framed on some of the concepts implemented Leadership Kauai but more importantly it has the appropriate evaluation forms and so forth which I hope your praise of HR will get us there someday. We are far from there. I have to thank you and your staff for what I feel is an outstanding job dealing with procurement in many areas from CIP, Project Management and so forth. But I have to be very honest with you, I am very concerned about emergency practices for purchasing. I will give you what I gave to Steve as it relates to what is defined as repair and maintenance versus asset capitol inventory. This is the GAAP definition, we need to practice this and those examples have come to light in the last couple months that you need to revisit with the Departments for example, in our golf concession yesterday we were told that we had people coming in to operate for club renters —concerning because the Pro-shop is closed. How we were selected and how we chose those people, "in an emergency" we need to have some clear policy practices there. We have done that as well as not an understanding of our intent of setting up concession money from Spouting Horn and the April 19, 2013 Finance —Purchasing(dmc) Page 13 intent of what is being done with R&M practices for that fund versus for purchasing of certain assets. Those assets are handled... you buy a tractor and it goes on our books. It is a lot different from the definition of repairing the roof or the toilets. I would ask that we get closer to that understanding as one of your missions for this year because I do not know how to say it other than the fact that I was surprised that some of the purchasing procedures were kind of thrown under the bus and pointed to some short comings in purchasing. I want you to know personally and I have let some of those Department Heads know that I was not happy with those responses. That delays were caused by Purchasing versus working together to come for (inaudible) and that is not healthy. Some of it in their minds, excused of being an emergency - not the case. We have procedures, we have an actual ways to get money to repair emergencies but I thought that was a little CYO and I am not happy with it. I am very serious. I will take action as the Council Chair the next time I see it being passed off like that. But you need to be aware talking to these Department Heads about the procedure just does not change because it is an emergency. The appropriate accounting is there for policy filing, you are the Purchasing Director, and it does get attention to move with some urgency but you have to follow the procedure, you got to book it right. I do not mean to end on that kind of note with my only question before I turn this over to Mr. Rapozo but your mission about getting us the best possible product for the best possible price-big success. Thank you, Ernie. Mr. Barreira: Thank you, sir. Chair Furfaro: But get a handle on these emergency repairs would you. Mr. Barreira: Very good sir. Chair Furfaro: Mr. Rapozo, I have to step out. Chair Furfaro, the presiding officer, relinquished Chairmanship to Mr. Rapozo. Ms. Nakamura: I wanted to pass out this case study on a situation that we have talked about it and so it is not a surprise to you but it is the Po`ipu Beach Park situation. I think what Chair was alluding to is that people blaming the process on Purchasing when there are other issues involved. This is not to point fingers but to say how can we do it better in the future. I know you have had personnel start up, positions, and challenges as well but I am hoping that we can use this as a tool to say how can we cut down the process, prioritized projects and not have this situation where we are waiting a year to fix a problem that was identified as a priority of this Administration. We have had conversations. Mr. Barreira: Yes. Ms. Nakamura: But I just wanted to pass this out and ask the Administration to really take a close look at what can be done for these priority projects. Mr. Barreira: Vice Chair, one of the things that you and I had spoken about and I would like to share with the Council and the people at home is that one of the new initiatives that I am going to take up in FY 2014 is not only receiving the multitude of bid documents that are sent to the Division of Purchasing but asking the Department Heads and the subject matter experts to define a prioritization of those solicitations. We have no particular preference of how we let these bids once they are convened to us, once the Honorable Mayor calls me and says that this is a priority that is April 19, 2013 Finance—Purchasing(dmc) Page 14 the order that we will take. Or if the Director, himself, tells us so by having this type of prioritization Countywide, we will be able to focus on those types of resources. Ms. Nakamura: I think those are the systems change that I was looking for and thank you, Ernie, for taking those initiatives. Mr. Barreira: Thank you. Mr. Rapozo: Ernie, have you taken an internal look at the procurements or the emergency procurements? Yesterday we talked about a few of them. I asked a question about the Humane Society that I am hoping the Attorney's are looking at, on the none mandated services that was somehow put into the contract without going through procurement. There is also the Golf and the ATMs and the one that was identified in the audit, itself. Mr. Barreira: Yes, sir. Mr. Rapozo: But have and is it even possible to take a look at all of these... of what I would call a "sole source" contract to make sure that we are in compliance with the State Procurement Code? Mr. Barreira: As this information becomes available and we will look into the requirements of what had transpired. When emergency procurement is very clearly and definitively defined within the law and it has 4 very distinct elements and there all and it is not "or." It is item 1 and, item 2 and, item 3... so, there are very, very few emergency procurements because it is such a stringent requirement under the law. Mr. Rapozo: And I guess, not as much emergency — I am talking about the... because the golf thing was done under emergency procurement. I am more interested in the "sole source" the ones that we are not going through procurement by some exemption. I think that is a where the attention needs to be focused. That somewhere in this process from where a request is made for whether it is a position, whether it is service, and a product, that between the request has been made and the check cut, that somebody should be catching that and saying "wait a minute, time out this does not meet an exemption, this has to go through procurement." Obviously, that is not happening because we are seeing these incidents pop up but is that being worked on? Is that through training? Mr. Barreira: It could be a training curve and I guess I was not here yesterday and I apologize for that but I understand there was some discussion, items that I can look into and determine if there were procurement issues involved. Technically, if there is a process being followed, that is competitive and that requires some sort of procurement activity and it has not occurred. That would be something that I would be concerned about but I would need to look at the specifics and make a determination in terms of whether or not there was a... whether it was competitive, whether it should have been procured. Mr. Rapozo: Well, we would not know and that is why I am asking. Is it possible for your Office to do an internal audit, your own internal audit because I would not know until it pops up on the floor over here. Then I am asking "what has been done?" We do not have that ability to know what was written, if not for the Auditors report, the Council would have never known about the one that the Auditor found the audit found. April 19, 2013 Finance —Purchasing(dmc) Page 15 Mr. Barreira: Yes. Mr. Rapozo: I think somebody needs to look at internally all of those and I guess you call it "exempt procurements or exempt from procurement" to take a look at each one and say did it in fact meet the law or did it not? I would assume that there is and maybe not intentionally — it is just because that is how we do it — that old famous excuse in business and government is, "that is how we always did it." Well, somebody got to be keeping track and say maybe we did it in the past, but this requires procurement. I think that is what I am interested in because until it pops up, whether in an audit or some inadvertent question that is answered, then it is... excuse me, I am more interested without going into a full blown investigation. As the Director, I would think you would be interested in going through these exempt procurements and making sure that we are in compliance with the State law. Mr. Barreira: To establish an exempt procurement is not determined at the Departmental level. There is only one entity in this room that can approve a procurement of an exempt nature either its exempted by law or rule or it falls under the Administrative rules which is a discretionary exemption which has to meet a two-prong test of being advantageous to the County and not being practical to follow admitting process. The Director of Finance must approve that and post for 7 days. So, there is approval of very clear and definitive review and approval mechanism that occurs for all exemptions when they are brought to my attention. I am not sure if there is some concern of whether some exemptions have been pursued absent my attention, I assume there is a communication coming over... Mr. Rapozo: Well, there will be. Mr. Barreira: Okay, I will look into it. Mr. Hunt: If I can address the ATM issue that came up yesterday, that actually is... we checked with Amy Esaki on this. It is exempted under HRS 102-2(b)4, so it does not have to go through procurement on ATMs. Mr. Rapozo: So, I can... and I am not trying to be funny but if I wanted to go and purchase an ATM, I can drop it on a County facility? Mr. Hunt: I believe if the financial institution wants to agree to put one over there that could be. Mr. Rapozo: Really? Mr. Hunt: Yes. Mr. Barreira: Even with exemptions there is a process. Exemptions are either exempting competition of exempting a process. It really depends. The exempts by law and by rule exempts allowable competition, so we identify that as an approve exemption in proper documentation and then we can hand select a vendor to provide that service. Mr. Rapozo: You can pick who you want? April 19, 2013 Finance —Purchasing(dmc) Page 16 Mr. Barreira: Yes. And of course either one that we are dealing with an approved exemption, we try to have the departments and agencies articulate a basis so that we can confirm that it is in fact an approved exemption by law or rule and that we have proper documentation for audit purposes. Mr. Rapozo: That is good to know because I may get some ATMs and they generate a lot of revenue for the bank with those transaction fees and if you get it in a County facility that is interesting. Mr. Hunt: The other one I would like to respond to too is the Ili golf course club rentals, there is no concession, there is no concession, this is mobile —if you call, and he will deliver the sets to any golf course. You arrange to have a drop off and a pick up time. As far as I know, it maybe the cart vendors themselves that have the brochures they are handing out, these are available, I believe at the airport rack. Mr. Rapozo: It was not the cart vendors yesterday, Ian said it was the County. Mr. Hunt: The County putting these out? Mr. Rapozo: But I have submitted a question yesterday specific to that because I do not that is appropriate. Ms. Yukimura: My apologies for being late. On this issue of exemptions, even though they are exemptions they have to come through your Office? Mr. Barreira: Yes. Ms. Yukimura: Did the exemption of the club rentals come through your Office? Because if it an exemption? Mr. Hunt: It is not a formal concession, we are not authorizing... it is a mobile. They are not taking control over the golf course or putting up anything that we know of on the property. It is just a matter of handing out business cards or flyers to people and they could be getting them at the airport. I do not know who is making the referrals. That would be something I would defer to Ian Costa to explain. Ms. Yukimura: The referrals are being made when people call our Office to make reservations, so it is an official referral of the County, from what I can tell. That does not...we can have that happened? People can refer certain services over others? Mr. Barreira: What we have to abide by, Councilmember Yukimura, is the establish element of the concession as defined as solicitation. What the concessionaire does in terms of operating that concession, as long as he meets the requisite elements of that contract with the County, I think we would have to conduct some legal discussion with the County Attorney in terms of this issue in particular. But this was not an exemption, it was not brought to my Office. We want to facilitate as an exempt procurement because we need the service. Ms. Yukimura: But that is the problem. If Managers — Department Heads and other Managers are not really familiar with the procurement laws, they may not even come to you as was this case. But how do you catch those that are April 19, 2013 Finance —Purchasing(dmc) Page 17 improper is the question? They may never be caught, that is one possible scenario and then they may be caught and there maybe liabilities out of that, right? Mr. Barreira: Yes. Ms. Yukimura: I think we are talking about prevention here because if Managers think they do not have to go through the procurement process, even to get an exemption to show that it is not in the procurement process, then your Office never knows what decisions are being made to say that it is out of the procurement process. Mr. Barreira: You actually missed my earlier presentation when I spoke in terms of the critical importance of procurement training at different levels of the organization,new employee, Department Head, subject matter training with regard to the different elements of procurement. You and I spoken about this before publically and behind the scenes where that training element is critical to have a good understanding of what to do and how to it is supposed to get done. Ms. Yukimura: Is this required of every new Department Head? Mr. Barreira: Yes, it is. And in our case, in Finance, in order for me or any member of my staff to continue their work, there is mandatory training by law in terms of procurement. Ms. Yukimura: I see. Mr. Barreira: For new employees, we encourage the Department Heads to identify those personnel to make sure that they come to... and I handle this personally, the general orientation in terms of the procurement requirements under the code and under the rules. I sponsor subject matter training based on demand. There are areas of the procurement code that requires substantial effort such as small purchases or in IFB's for example of Professional Services. Ms. Yukimura: So, if we had a question as to whether a Manager has been trained, you would have a record of them being trained? Mr. Barreira: I do not maintain active records. There is no reason why I could not do that. I would have to go by... could I add to it that Larry Dill has been trained in procurement, I could answer that question but I do not keep a record of that, no. Ms. Yukimura: Because I am thinking back to the two sort of problems that we had. One, was with the former Prosecuting Attorney and one was with the president Parks Deputy and I am presuming and I would like to confirm that there is training of those... I think it is often that Managers will feel that "I do not have to do this," my people under me have to do it. Mr. Barreira: Yes. Ms. Yukimura: And then we may get into problems. Mr. Barreira: In all fairness, I do not want to conclude that this golf situation is a violation or ethics issues, I think we need to further explore it and look at all the facts. We will be happy to come back to Council with our findings. April 19, 2013 Finance —Purchasing(dmc) Page 18 Ms. Yukimura: I am not assuming that either but the fact that there were questions raised and we could not get clear answers from the Managers make me ask the question"were they trained." Mr. Barreira: Understood. Ms. Yukimura: Okay, thank you. Mr. Barreira: I will look deliberately at the inquiry and will respond in time. Mr. Bynum: Our vendor contracts, do they include a rent fee plus a percentage of sales? Mr. Barreira: I would have to look at the particular concession. We are letting two concessions now — Spouting Horn is just about concluded and of course my marching orders is to let the Golf Shop and the Restaurant concessions as soon as we are able to. Mr. Bynum: My understanding is that those contracts — the County... the payment to the County involves a percentage of sales? Mr. Barreira: It could well be, sir. I would have to check the particulars. Mr. Bynum: On this golf club thing, I do not know the whole story but there is a need, people step up to meet the need. We knew this issue with the Pro- shop for 2 years. Two years I have asked to negotiate, change the contract, and make sure that this place stays open. I cannot make judgments about the vendor but I do believe that the closing, opening, closing, opening affected this business losing the ball concession affected his business. He's is the pro and he had to even pay for the own balls to use at the range. I have asked for 2 years. We are going to lose this concession and it would be devastating. The point is that we are also losing revenue. Those club rentals, I believe, we get a portion of that. It is very frustrating. Mr. Barreira: I assume it is coming over. I will take a look at it and give you particulars. Mr. Bynum: When the restaurant was there, at times there were mobile vendors out there and I do not know how that was procured, it turned out that they were only going out there at high valued times, right? When there were lots of... but not consistently providing it. Mr. Hooser: I have a brief question about Spouting Horn. Your Office reviews and is a clearing house, if you would, for people that are interested and awards contracts? Mr. Barreira: We formally let the concession after it is submitted by the Department where we work with closely to make sure the particulars are clear and that we have a concession that is in line with the law. We publicize it on the internet and then we receive offers. April 19, 2013 Finance —Purchasing(dmc) Page 19 Mr. Hooser: The reason why I am asking is, recently a day or two ago, I thought it would be interesting to see what is required to apply for a Spouting Horn permit. I either got an E-mail or somehow saw the... so I clicked on it and I could not p g figure it out. I would like to think that I am a pretty smart guy but perhaps not. It said something about you have to request something and then I went through clicking around and could never find the document that I was supposed to request in order to get the other information that would tell me what it is all about. You might want to look at the website to make it more user friendly or perhaps after this meeting, you can tell me where I was going wrong. Anyway, it was not user friendly enough for me. Mr. Barreira: That is good to know. Mr. Hooser: And so if it is happening to me, it is probably happening to other people. Mr. Barreira: We do have concessionaires that come into the County to ask questions, we do have them calling. Of course the protocol normally is if they have a problem or concern, we defer them... if it is subject matter base, we refer them to the Department. If it is systemic in terms of procurement, we would address it. In many times we ask that they transmit an E-mail communication so we have a record of their inquiry. Mr. Hooser: As an interested person has to fill out the form to get the information about the bid? Mr. Barreira: They have to register. Mr. Hooser: Can they just click and find the information online? Mr. Barreira: If you go to the Division of Purchasing website and click on bids and proposal, it will take you to our listing of solicitations. If it says, registration required, you will have to click on that, you will do a very quick registration and immediately the system sends you a link that enables you to acquire that solicitation online. The reason we do that is because the rules mandate that we maintain a ledger of all people who pull solicitations. Mr. Hooser: Okay. I will look at it again. li Mr. Barreira: I would be happy to sit with you and navigate through the system. Mr. Hooser: Let me try again to see. Mr. Barreira: Very good. Mr. Hooser: Then we can talk. Mr. Barreira: And so, it is closed so it may not be assessable any longer. The bid for Spouting Horn is closing because we had to go out a second time because there were not enough applicants. Mr. Hooser: I guess the bottom line is that we need to make it more user friendly as possible and I did not find it that user friendly. April 19, 2013 Finance —Purchasing(dmc) Page 20 Mr. Barreira: It is very valuable when County personnel look at the system because we want to strength it, we want to make it effective as possible. Mr. Hooser: Thank you. Chair Furfaro: Folks, a reminder here that we also going to do Risk Management before we do Civil Defense at 11:00. Continuing with Procurement, JoAnn. Ms. Yukimura: So, you had to go for a second round and you did get enough applicants? Mr. Barreira: I am not sure. Ms. Yukimura: Interesting, thank you. Chair Furfaro: Procurement questions? Ms. Nakamura: I am glad that your positions are now filled. You have 1 more position to fill? Mr. Barreira: Yes. Ms. Nakamura: But we approved that second Specialist in your Division last year because of what we proceed to be a bottleneck and the need for additional resources to get the County resources out into the community. I was just looking at your budget and your budget from 2 years ago is a 10% cut and from last year it is a 5% decrease, so this shows that with the additional body, you are still able to provide the services and reduce cost. I am thinking it is because of the use of technology. Mr. Barreira: Absolutely. Ms. Nakamura: I think this is a very great trend we want to see these types of numbers in the Divisions where technologies can make a difference. When we talk about future improvements, I am thinking that a user survey of vendors who use our services as well as the different government agencies within the County who use your service will really provide additional insights on how we can better improve the delivery. I really think that this has a direct impact to our economy. I just want to encourage that in the future. Mr. Barreira: Very good. And to clarify the position that the Council appropriated to us was actually shared with the IT Division by design. The first 6 months was IT's and in January it became available to us. That is one of the two positions that we filled. The position that still has to be filled is the senior specialist vacancy that was created with the departure with Rowena earlier this year. That is critical to us as well. You are absolutely correct Vice Chair, technologies enable us to maintain higher levels of productivity without having to spend money. I debate in all of my years in government that you have to have a rich operation to be effective, I argue that that is not accurate. Ms. Yukimura: Following up on that. I think last year's report was exactly as Vice Chair was saying, it is an extraordinary achievement in a short time. I had a conversation with you earlier though about the lights being on Saturday. April 19, 2013 Finance —Purchasing(dmc) Page 21 Mr. Barreira: We talked about that already. Ms. Yukimura: Oh, you talked about it? Mr. Barreira: Yes, when you were not here. Ms. Yukimura: Okay. So, the discussion is that if you fill that senior position, you will be able to do it without as much overtime? Mr. Barreira: We were able to fill our two vacancies out of the three with two outstanding young women. The short answer to that question, yes. Is overtime still going to be in my budget, yes it is still in my budget because while the technologies will make us more efficient, it is never going to replace the art of analysis that is conducted by the specialist in processing the various procurement work. Ms. Yukimura: Right, thank you. I just want to acknowledge that we may have this technology available but it really takes a Manager to be able to use and integrate it into the systems. Congratulations on that. Again, the administration is demonstrating this cross department cooperation that is really very excellent. So, thank you for that. Chair Furfaro: For procurement, I think we are pretty close here. I do want to say one more thing, I understand there was some discussion when I went out on my phone call but I would expect that if there is a deviation from an interpretation of general accounting practices, you have something for me from the County Attorney that says there is a deviation. Mr. Barreira: Absolutely. Chair Furfaro: One piece on a concession does not make up for what I interpret it as a need to make some communication improvements to the Department Heads. Thank you for all the great work and if you can focus on that over that over the next year, I personally would appreciate it. There being no objections, the Council recessed at 10:26 a.m.