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HomeMy WebLinkAboutOrdinance 5351 ORDINANCE NO. 5351 AN ORDINANCE TO REPEAL §34.26 AUTHORITY OF CITY EMPLOYEES TO CONTRACT WITH THE CITY AND TO ENACT A REPLACEMENT §34.26 LIMITED AUTHORITY OF CITY EMPLOYEES TO PROVIDE SERVICES TO THE CITY WHEREAS, state law prohibits any city official or employee from profiting from "any contract for furnishing supplies, equipment or services to the municipality unless the governing body of the city has enacted an ordinance specifically permitting ... municipal employees to conduct business with the city ...." A.C.A. §14-27-107(b)(1); and WHEREAS, on June 5, 1984, the City Board of Directors passed Ordinance No. 3013, now codified as §34.26 Authority of City Employee to Contract with the City; and WHEREAS, the current code section uses such broad and imprecise terms that it appears to prohibit not just the furnishing of services, but any contracts (such as an employee leasing a T- hangar) if such rental amount paid to the City exceeds $500.00; and WHEREAS, this code section needs to be revised so that city employees may work as umpires and referees for the City Parks and Recreation Department and other employees may provide services when specifically authorized by City Council Resolution. NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE,ARKANSAS: Section 1: That the City Council of the City of Fayetteville, Arkansas hereby repeals §34.26 of the Fayetteville Code entitled Authority of City Employees To Contract With The City and enacts a replacement §34.36 entitled Limited Authority Of City Employee To Provide Services To The City as shown below: "§34.26 Limited Authority of City Employee To Provide Services To The City "An employee of the city shall be permitted to furnish services as an independent contractor to the City only if: Page 2 Ordinance No. 5351 "(A) The employee fully discloses his or her direct or indirect financial interest in any contract or service agreement to the City Council and such services are approved by City Council Resolution; "(B) No favoritism is allowed to the city employee over other possible service providers; "(C) Such services are not of the same type as performed by the city employee in his or her regular city job, nor are services for the department wherein the employee works; "(D) The employee's immediate supervisor specifically approves such extension of employee service and ensures it will not adversely affect the employee's regular city employment duties; "(E) City employees who are not within the Parks and Recreation Department are specifically allowed to work as independent contractors as scorekeepers, referees and umpires for the Fayetteville Parks and Recreation Department without the need for a City Council Resolution." PASSED and APPROVED this 7t" day of September, 2010. APPROVED: ATTEST: By: By. �. EID JO , Mayor SONDRA E. SMITH, City Clerk/Treasurer °°!!1lii1F11;Br K/Tk L� c r ®.�,��®®°�e1 Y °FAYETT ® EV{LLE e ° AGENDA REQUEST FOR: COUNCIL MEETING OF SEPTEMBER 7, 2010 FROM: KIT WILLIAMS, CITY ATTORNEY ORDINANCE OR RESOLUTION TITLE AND SUBJECT: An Ordinance To Repeal §34.26 Authority Of City Employees To Contract With The City And To Enact A Replacement §34.26 Limited Authority Of City Employees To Provide Services To The City APPROVED FOR AGENDA: " City Attorney Date c. C� C ief of Staff Date 01 doA i p Fin nce Director ate 3 Mayor Date 08-20-IOPO4 :47 RCVD ER FAYETTEVILLE THE CITY OF FAYETTEVILLE,ARKANSAS KIT WILLIAMS,CITY ATTORNEY �Lll DAVID WHITAKER,ASST.CITY ATTORNEY DEPARTMENTAL CORRESPONDENCE LEGAL DEPARTMENT TO: Lioneld Jordan, Mayor City Council FROM: Kit Williams, City Attorney s _4_4`------ _W DATE: August 20, 2010 RE: §34.26 of Fayetteville Code; A.C.A. §14-42-107(b) Twenty-six years ago, the Fayetteville Board of Directors passed Ordinance No. 3013 which has been codified as §34.26 of the Fayetteville Code: "34.26 Authority of City Employee To Contract With The City "An employee of the city shall be permitted to conduct business with the city, provided the contract or job is for services, is submitted as a competitive bid, is approved by the City Council following disclosure of the direct or indirect financial interest of the individual employee, and the total sum payable under the contract does not exceed $500.00." From a legal point of view, the wording of this old ordinance is very lacking in clarity of purpose and effect. It was specifically enacted in response to A.C.A. §14-42-107(b) to permit a city employee to conduct business for "the profits of any contract for the furnishing supplies, equipment or services to the municipality ...." A.C.A. §14-27-107 (b)(1). (I have attached Ordinance No. 3013 for your review.) Unfortunately, instead of just authorizing a modest amount of services to be sold to the City by an employee, it used the term "conduct business with city" which would also prohibit an employee from purchasing goods or services (like entering into a T-hangar lease) from the city if the contract exceeded $500.00. State law had no such restriction. (See below) "Interest in offices or contracts prohibited "No alderman, council member, official, or municipal employee shall be interested, directly or indirectly, in the profits of any contract for furnishing supplies, equipment, or services to the municipality unless the governing body of the city has enacted an ordinance specifically permitting aldermen, council members, officials, or municipal employees to conduct business with the city and prescribing the extent of this authority." A.C.A. §14-27-107(b)(1). This statute clearly sets forth a one way prohibition. Officials and employees cannot sell services or products to the City unless the City Council specifically permits and regulates such sales. Unfortunately, the City Board chose such imprecise wording ("conduct business with the city") that the Code seems to prohibit all business transactions with the City even if the employee is paying the City to buy services (like water, sewer, solid waste fees, etc.). This was surely not the intent of the City Board. We now have a city employee who wishes to rent a T-hangar at the Fayetteville Municipal Airport at the standard public rate. That certainly is "conduct(ing) business with the city", but it is not a "contract for furnishing supplies, equipment or services to the municipality ...." Id. (emphasis added) Therefore, an employee renting land or a building from the City would not violate state law, but may appear to violate Fayetteville Code §34.26 Authority Of City Employee To Contract With The City. This would seem to be a very confusing and contradictory result as aldermen and city officials are not authorized (and thus not restricted) by the City Code from renting or purchasing services from the City, while employees would be restricted. This could not have been the intent of the City Board of Directors and surely is not the intent of our current City Council and Mayor. Therefore, I propose some substantial modification to §34.26 to reflect what I believe was always the true intent of the ordinance — to allow some furnishing of services by employees to the City with safeguards like full disclosure and express City Council approval. The broad term "conduct business" should be replaced with ,"by furnishing services" (from the state law) so that it is clear employees (like ordinary citizens) can purchase water, sewer and solid waste services, and rent T-hangars from the City. I have drafted and attached a new §34.26 Limited Authority of City Employees to Provide Services to the City for your consideration. I wanted to ensure no favoritism would be given to city employees over regular citizens for the opportunity to provide services {see (B)} and that the City Council would have to be fully informed of any direct or indirect financial interest of the employee and approve the purchase of such services by City Council Resolution {see (A)}. The Department of Labor forbids an employer (like the City) from hiring its employees as independent contractors to perform services similar to their normal job duties. (Employers used to do this to avoid paying overtime.) I tried to protect the City from this situation in (C). We also wanted to be sure that an employee's normal work duties would not be adversely affected by independent contractor work for the City {see (D)}. I believe that most of our city employees who work as independent contractors providing services to our City work as umpires or referees. As long as these employees are not employed by our Parks and Recreation Department, I believe we would not face an issue with the Department of Labor nor any perceived unfair favoritism by our citizens. Thus, I .propose exempting these employees from the need for specific City Council Resolution in (E). I have been informed that some Parks and Recreation employees wish to work as independent contractor umpires or referees for the Parks and Recreation Department. I am uncomfortable with this arrangement not only because of Department of Labor concerns, but also because the apparent conflict of interest or perceived favoritism of the Parks and Recreation Department hiring its own employees over other citizens. Even though there might actually be no unfair favoritism at all, it would be hard to dispel the smell of an "inside deal." I would prefer that the employees simply work as umpires or referees as regular employees on the clock. We would then hire only those independent contractors needed for games our employees could not work. There has been some internal disagreement about whether or not to exclude Parks and Recreation Department employees from being employed as independent contractors working for Parks and Recreation. The City Council will need to resolve this issue and amend my proposed ordinance if you believe my restriction is not needed or not appropriate. ORDINANCE NO. AN ORDINANCE TO REPEAL §34.26 AUTHORITY OF CITY EMPLOYEES TO CONTRACT WITH THE CITY AND TO ENACT A REPLACEMENT §34.26 LIMITED AUTHORITY OF CITY EMPLOYEES TO PROVIDE SERVICES TO THE CITY WHEREAS, state law prohibits any city official or employee from profiting from "any contract for furnishing supplies, equipment or services to the municipality unless the governing body of the city has enacted an ordinance specifically permitting ... municipal employees to conduct business with the city ...." A.C.A. §14-27-107(b)(1); and WHEREAS, on June 5, 1984, the City Board of Directors passed Ordinance No. 3013, now codified as §34.26 Authority of City Employee to Contract with the City; and WHEREAS, the current code section uses such broad and imprecise terms that it appears to prohibit not just the furnishing of services, but any contracts (such as an employee leasing a T- hangar) if such rental amount paid to the City exceeds $500.00; and WHEREAS, this code section needs to be revised so that city employees may work as umpires and referees for the City Parks and Recreation Department and other employees may provide services when specifically authorized by City Council Resolution. NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE,ARKANSAS: Section l: That the City Council of the City of Fayetteville, Arkansas hereby repeals §34.26 of the Fayetteville Code entitled Authority of City Employees To Contract With The City and enacts a replacement §34.36 entitled Limited Authority Of City Employee To Provide Services To The City as shown below: "§34.26 Limited Authority of City Employee To Provide Services To The City "An employee of the city shall be permitted to furnish services as an independent contractor to the City only if: "(A) The employee fully discloses his or her direct or indirect financial interest in any contract or service agreement to the City Council and such services are approved by City Council Resolution; "(B) No favoritism is allowed to the city employee over other possible service providers; "(C) Such services are not of the same type as performed by the city employee in his or her regular city job, nor are services for the department wherein the employee works; "(D) The employee's immediate supervisor specifically approves such extension of employee service and ensures it will not adversely affect the employee's regular city employment duties; "(E) City employees who are not within the Parks and Recreation Department are specifically allowed to work as independent contractors as referees and umpires for the Fayetteville Parks and Recreation Department without the need for a City Council Resolution." PASSED and APPROVED this 7th day of September, 2010. APPROVED: ATTEST: By: By: LIONELD JORDAN, Mayor SONDRA E. SMITH, City Clerk/Treasurer ORDINANCE NO. 3013 AN ORDINANCE AMENDING CHAPTER 2 OF THE FAYETTEVILLE CODE OF ORDINANCES TO PERMIT A CITY EMPLOYEE TO CONDUCT BUSINESS WITH THE CITY AND PRESCRIBING THE EXTENT OF SUCH AUTHORITY. WHEREAS, Ark. Stat. Ann. §19-716(e) provides that no employee shall be interested directly or indirectly in any contract made with the City unless the Board of Directors shall have enacted an ordinance specifically permitting an employee to conduct business with the City and prescribing the extent of such authority. NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF DIRECTORS OF THE CITY OF FAYETTEVILLE, ARKANSAS : Section 1. That Chapter 2 of the Fayetteville Code of Ordinances is hereby amended by adding Section 2-70 to read as follows : Sec. 2-70. Authority of City Employee to Contract with the City. An employee of the City shall be per- mitted to conduct business with the City provided the contract or job is for services , is submitted as a competitive bid, is approved by the Board of Directors Jer following disclosure of the direct or indirect financial .r fore. interest of the individual employee , and the total sum Arore. : 3day payable under the contract does not exceed $500. 00. 'me is PASSED AND APPROVED THIS 5th day of June 1984. .1914 �-- ri••K^ APPROVED : By - ,� Mayor . ATTEST: r.7 f n r =- B y v C a C ty Clerk " r J r%, .:: BOOK 1111PAGE195 waa � FAYETTEVILLE THE CITY OF FAYETTEVILLE,ARKANSAS /1 KIT WILLIAMS,CITY ATTORNEY DAVID WHITAKER,ASST.CITY ATTORNEY DEPARTMENTAL CORRESPONDENCE �,C2 LEGAL DEPARTMENT TO: Mayor Jordan City Council Sondra Smith, City Clerk CC: Connie Edmonston, Parks & Recreation Director FROM: Kit Williams, City Attorney __._.........._................. DATE: September 2, 2010 RE: §34.26 Limited Authority of City Employees To Provide Services To The City Connie asked to have scorekeepers added to umpires and referees in subsection (E) of this new code section. She reports that the Parks and Recreation Department frequently must obtain city employees as scorekeepers as well as referees and umpires. Connie requests that you amend the currently proposed ordinance to add scorekeepers in subsection (E). Attached below is how §34.26 Limited Authority of City Employees to Provide Services To the City will read if scorekeepers are added to (E).. "§34.26 Limited Authority of City Employee To Provide Services To The City "An employee of the city shall be permitted to furnish services as an independent contractor to the City only if- "(A) f"(A) The employee fully discloses his or her direct or indirect financial interest in any contract or service agreement to the City Council and such services are approved by City Council Resolution; "(B) No favoritism is allowed to the city employee over other possible service providers; "(C) Such services are not of the same type as performed by the city employee in his or her regular city job, nor are services for the department wherein the employee works; "(D) The employee's immediate supervisor specifically approves such extension of employee service and ensures it will not adversely affect the employee's regular city employment duties; "(E) City employees who are not within the Parks and Recreation Department are specifically allowed to work as independent contractors as scorekeepers, referees and umpires for the Fayetteville Parks and Recreation Department without the need for a City Council Resolution." NORTHWEST ARKANSAS NEWSPAPERS-Lc RECEIVED Northwest Arkansas Democrat Gazette The Morning News of Springdale OCT 0 2010 OF The Morning News of Rogers C`c Y CLERK'S OFFICE FAYETTEVILLE Northwest Arkansas Times Benton County Daily Record 212 North East Avenue, Fayetteville Arkansas 72701/ PO Box 1607, 72702 PHONE: 479-571-6421 AFFIDAVIT OF PUBLICATION I, Cathy Wiles, do solemnly swear that I am Legal Clerk of the Northwest Arkansas Newspapers LLC. Printed and published in Washington & Benton County, (Lowell), Arkansas and that from my own personal knowledge and reference to the files of said publication, the advertisement of: City of Fayetteville — Ordinance No 5351 September 16, 2010 Publication Charge : $ 207.52 Signed: 0UU 9 ---- — ---------------- Subscribed and sworn to before me This2'��`day of I;ZL. , 2010. Notary Public 119 JOSHUA M LYNCH Notary Public-Arkansas My Commission Expires: Washington County N, My Comrnission Expires 1 0-213 201 2 Commission # 12366414 = Do not pay from Affidavit, an invoice sent