September-9-2019-Regular-Board-Meeting-segment-3
[00:00:00] What we could do is if we could defer this give an opportunity for new board member any board member to have a session with dr. Hughes and then chair Molitor I would suggest we do a special meeting and folks can phone in and we just as long as we have a quorum take care of this resolution. I appreciate that opportunity.
Okay. The auditor will be here during the last week of September. Was it September 23rd to September 27. So it's important for us to have that resolution of proof so I can move the budget to the right category before they come in out of the book. If not, then it look like we violated by chat. I'm I'm comfortable with delaying it because I also would like to understand it better.
And so part of me thinks like should we ask those questions understand it better right now [00:01:00] or I mean or should I try to join you when you do that, but but I also would have the same need and so I don't know if it's something we do right now or indeed later. I think the depth of my confusion is not going to be solved in the next 10 to 15 minutes.
So despair all of you that. I would suggest doing it at a later time outside of meeting great and then we can kind of tailor you know that session to where your questions lie.  And remember this this is from the 1819 budget. It's not this year's so it's as. As that budget is getting finalized and trued up for the auditor to now review.
These actuals need to be transferred and shifted instead of just guesstimate sin June which is where we were.  meeting some violations.  they weren't they weren't extreme violations. It was the kind that this auditor just likes it to be a little [00:02:00] more precise and on point with things they weren't.
Violations that had us in out of compliance.  If we're going to do that, I would just ask that if you see some commonality of questions among the board members that speak with you that you bring those clarifications forward to the rest of the board and then or something before any meeting.
Do you like the idea of slowing it down, especially when it comes to the money and budgets that we all have a clear understanding? So that will address the resolution but we still have the second part of dr. Hughes is everybody ready for that? Okay. Okay. So the last items is the per site account setup view 1566.
We talked about this one few months ago and. Sighs So Cal State and a cow [00:03:00] that desire to redo payroll rate by half and employer deposit actual payment duper the Oregon legislature established. The fun it called employer incentive fund to encourage public employer to establish site account for the purpose of prepaying prorate in the future.
The the minimum deposit is 25,000 and the maximum is you can do but mustard you want and they will match up to 25% So. They match up 25% it not many guarantee 25%.  this information we receive from Oregon Department of Education if we put in the minimum of 25,000 then they were mattress 6100 $6,250.
So our total Saiga cow [00:04:00] minimum site account will be 30 $1,250. The maximum for outside of the district is 18 point eight million. So if we have that much money to put into that employer incentive fund then they will mattress 4.7 million. It might our total maximum site account equal to twenty three point five million last year when I received the report from Piper cioffi ual rate at the rate of two hundred and ten percent.
But based on the report of December 31st of 2017 our unfunded liability rate drop down from 210 to one hundred eighty four percent. What's this mean? Is this mean for employer who [00:05:00] held the ual rate of both 200%. Then we will qualify to apply for this employer incentive fund during the first 90 day of opening with a September 3rd to December 1st because we are below that rate.
So December 2nd is open the second roll open for any employer that below 200 percent rate. So if ball member interested in this investment, then we can call for work session and we can help hypertrophy come in and bring us to a deep level for my conversation with Carol Summers.  Based on her knowledge and understanding she said a master mom that other school district contribute to this employer incentive fund is 2 million.
In my [00:06:00] opinion, I don't think this is a good way based on our skin Victory current situation. We don't have much money available. The only money that available is that sit for a million in land that we have but that money is really. You know, if if we think we never need to use that money to purchase any future land for the digit then it's okay, but I think we have something going on right now.
Asking is that money? So as soon at we invested money this money has to be. No from cash. No borrowing. We cannot borrow money from somewhere for this and as soon as we invested money, you have no control over this money.
[00:07:00] So that was at that was my question is so you're saying like once we put this money into the account we are and then not able to touch it for was that 20 years? Okay, and so we're putting it into that account. I think the I'm missing is it's designed to reduce our payroll tax rate. Hi. How is that functioning?
So we're going to put that money in there. We essentially I'm guessing her. We're lending money to someone and then 20 years from now. We'll get that money back. Plus this this matching that isn't full matching though, Oregon legislature created account because side a cow or employer incentive fund and then employer deposit money in there.
Give them that money that you that money to invest. And they.  But promise that they [00:08:00] will March in the money up to 25% but that not guarantee and then we go over the history. I went over the history. Would Piper choppy on the interest rate that we own over the last few years the maximum. The interest rate go up is 7.2 percent.
So the promise of 25% matchin up to that 25% matchin, is it not guarantee that something guarantee? So if let's say if we invest two million the maximum we receive from that is about. 500,000 was it up to 25% And if we put the money in it mean you don't have any control or you don't see that money in 20-year.
The reason it Loadout the ual rage is every year we received form [00:09:00] from. Post department at electress know how much we have to pay for the right 41 the right 4 to 2 and the rate for lobster with the did three few months ago. I present that information and I can remember it's like it go up by around 5.8% 41 and.
It's super simple to do something like that. So if we have that money then that braided bone down the degrees. So inside that instead of 28 percent the record page 26 percent or 25 percent.
So think you know question for you as a board is one. Do we have enough asset? To make something like this worth it. There may be some districts that have [00:10:00] 15 million more maybe larger school districts that might say tucking away 3 million something to receive then this matching even though you can't touch it for 20 years could be a helpful thing for a future board to then have come back to them in terms of support for their prayers.
Liability we have at the most about 6 million from our land sale. If we're not anticipating spending any of that the next 20 years. This could be something you want as a board to think about what I do know that you've done as a board as you've asked for this we put in a land bank there is leaning towards likely we would need to access it in the coming years as a growing District.
You've asked for Flo analytics to do a review of [00:11:00] property in the area as you're thinking whether it's this board or the next board about some steps in the near future and that would be the only asset that this board or future board would have in the near future to do use for any future land purchase.
Is it it is out there you may have heard about it. It's been brought up several times as well as a one more kind of relief mechanism for school districts that the state is come up with or like to provide for those districts that feel like this would be a good option for them. It doesn't have to match with every school districts needs.
Bring It Forward because the deadline is December and you get to make the decision not us and so there it is.
All right, that's all I have and then just from a process standpoint. Then would [00:12:00] we then have this brought back to us again, or are you waiting for some sort of indication from the board that there may be interest in this before December? We'll wait we'll wait for you, but we kind of just you just now know the timeline.
It was something that we discussed also last year and there didn't seem to be great interest in it. But now the timeline is approaching closer. We have a new board just bringing that forward again to this to this board to consider.
We have six million dollars from the land sale what rate of investment have we been getting? On our money you mean where that money? Where did you get that money? No. No, I'm wondering what rate yeah. Is there an [00:13:00] interest rate and on the account the Bears that money? Right now we put that money in the LGI P the local government investment pool and we own 2.75 percent.
So that's a the highest interest rate that we own right now because other investment is like below 2%.  So this would be a higher interest rate presumably doesn't screw it up like they did before okay.
Kind of reading body language just just so we can give you some direction and it doesn't seem like there's a lot of Desire of potentially to learn more about this and pursue it. Am I I'm perfectly calm.  Colleagues thought that they wanted to I would join you in that I'm interested in learning more on my own.
All right. So should you want to revisit pursuing this let me know? [00:14:00] Okay, but I'll let you know. This will be a very good work session with Piper Javy last time what my work session with them. They were sharing that this side of Calvary very much like a Band-Aid for you know, you will bleed in and get a Band-Aid but in order to really fit the problem.
And we're talking about the popo born with the with this in the past in 2004. We went out for pro ball. So that that will be a great work section just for the knowledge to learn.
Okay, and then we will we will move the proposed resolution for a special meeting in the next week or two and. We will now move on to oh, yeah, sorry the privilege of a recess for just two or three [00:15:00] minutes.  It will take your quick. Yeah, three to five minute recess.