In an attempt to answer readers’ questions about the current OPC budget dispute, we consulted the Interlocal Agreement that governs the OPC, budget documents, meeting minutes, the most recent audit and relevant officials.
WHO RUNS THE OPC?
The OPC was created as a separate public corporation in 1983. The municipalities of Rochester, Rochester Hills and Oakland Township jointly fund it and share authority under the terms of the Interlocal Agreement (ILA). The OPC does not have taxing authority. Finances are administered by the city of Rochester Hills.
WHAT IS THE OPC GOVERNING BOARD?
The board consists of representatives from all three communities: four from Rochester Hills, two from Oakland Township and two from Rochester. Half are elected officials; each is appointed by their municipality’s elected body.
HOW IS THE OPC FUNDED?
Taxpayer funding is pro rata, based upon the total assessed property value in each municipality. The OPC also receives grants and donations, collects fees for services and conducts fundraising.
HOW IS THE BUDGET APPROVED?
Each year, after the OPC governing board approves a budget for the next year, the budget must be sent to the three municipalities for consideration by their elected bodies. All three municipalities must approve an identical budget by Oct. 1.
WHAT IS THE PROBLEM?
Rochester City Council has not yet approved the OPC’s 2012 budget. Rochester’s first attempt at a revised budget was rejected by the other two municipalities. A second Rochester proposal will be considered by the OPC board at its Feb. 2 meeting.
HOW DID WE GET TO THIS POINT?
OPC employees did not receive any increases in compensation in 2009 or 2010. Then in May 2011, the OPC board voted to increase the payment to employees who opt out of health insurance from $1,500 per year to an amount equal to the individual rate at the time, an estimated $7,950 per year. Rochester’s two representatives, Mayor Stuart Bikson and Lucy Strand, dissented.
In June 2011, the governing board created a first-ever pension plan for full-time employees. The OPC contributes the equivalent of 6 percent of salary if the employee contributes 3 percent. The plan currently covers 14 employees retroactive to January 1, 2011. The vote was 7-1, with Strand dissenting. At the same meeting, the board approved its 2012 budget.
In November 2011, the board voted to give employees a 1-percent raise for 2012 and reinstitute step raises. Bikson and Strand dissented.
IS OPC EXECUTIVE DIRECTOR MARYE MILLER GETTING A 17-PERCENT RAISE IN 2012?
No. She would receive the same 1-percent as other employees. Like other participating full-time employees, last year she received the pension contribution and the increased payment in lieu of health insurance. If the OPC’s proposed 2012 budget is approved, her increase over two years would be about 15 percent.
IS AN OPC EMPLOYEE ON THE GOVERNING BOARD?
No. Oakland Township Supervisor Joan Fogler, who serves on the governing board, is a volunteer who leads senior trips. The city of Rochester Hills, which serves as the OPC’s fiduciary, said Fogler does not receive any tax documents since she receives no income.
HAS THE OPC RAISED FEES LATELY?
According to Miller, no. Where the budget shows an increase in revenue from fees, it is because of greater participation in programs.
IS THERE A WAITING LIST FOR MEALS ON WHEELS?
According to OPC board President John Dalton, no. No one has ever been turned away from the program.
WHAT IS THE ADDED COST TO THE OPC OF THE INCREASED BENEFITS?
According to Rochester Hills City Councilman Michael Webber, who also serves on the OPC governing board, $65,000 is the cost of new expenses related to employee pay and benefits in the 2012 proposal.
DO THE CITY OF ROCHESTER’S EMPLOYEES RECEIVE THESE BENEFITS?
According to the city’s finance director, John Hiller, most city employees who opt out of health insurance receive payment of $500 per month. Employees hired before 2012 generally receive longevity pay based on a step system.
IS THE OPC IN FINANCIAL TROUBLE?
According to its auditors, no. When Plante & Moran presented their report on the 2010 fiscal year on May 5, 2011, they said the OPC had increased its unrestricted fund balance to $1.3 million, or about one-third of annual operating costs. That occurred despite the fact that revenue decreased by $260,000. Actual 2010 revenues and expenditures were less than expected.