City Council - Regular Meeting

Oh, my truck's been running low cuz I don't want to post in the morning. I have to until it goes back down. Is it time? I wouldn't do it. I just started the streaming so we could probably Whenever you're ready, you let me know. six. Are you ready? Go ahead, Mr. Mayor. Yeah, sure. I would like to call this meeting to order. This is a work session. Uh this is just information. There is no decisions. Uh there will not be any public comment this evening. And with that, I would like to turn it over to Mr. Stew.

Thank you, Mr. Mayor and Council. Uh tonight, we're going to welcome Dennis Lion with Home Serve. He recently connected with John at a or leading cities event. a few months ago. Um we Stacy and I visited with him prior to get some more information and he's got some extra extra questions that we gave him ahead of time to answer for you and you might have more. Um he's introducing a public private partnership for the city of Lrand that could generate revenue for the city. As you know, part of our fiscal transformation initiative that John's leading, we're trying to uncover all the opportunities we can for revenue without taxing or imposing fees on our citizens. So, this opportunity might align just right with that kind of opportunity. So, without further ado, Mr. Dennis Lion, thank you for coming all the way from Pittsburgh.

Oh, wow.

Thank you. It's a pleasure to be here. Excuse me. And I appreciate the invitation. Um, I appreciate the time. Thank you so much, mayor, council, candidate, and staff, um, for your time and attention. Um, I know your time is valuable, and this is a work session. I don't want to take up too much of it. So, the idea here is I'm going to share information about what our program is, what it does, how it works, um, how it benefits homeowners, how it benefits the public side as well. And then you'll have an opportunity to ask any questions or anything like that. Um, and obviously no decision is being made tonight, so you don't have that extra added, why don't we have to come to a decision, right? So that should help as well. Um, so I'm with Homeserve and I'm here to introduce you to the service line program, which is a solution for municipalities, utilities, and homeowners alike. Excuse me. So just a little bit about us. We have been offering this service for over 20 years now.

Can we take pictures? Oh, yeah, absolutely. I just want to ask before I sent this to you in email. So you have it. Oh, we have that now? As of today? Yes. Oh, you have? I did check it today. I checked it yesterday. Okay. Super. You want to take pictures?

Um, so we we um are one of those companies that after every interaction with a customer, whether it's a service, phone call, whatever, we're asking them how we did. We're rated 4.8 out of five stars in customer satisfaction. Uh if you look at the key statistics here, you can see how many customers we have, how many plans there are in place. Um how many partnerships we have in North America, uh United States and Canada across North America, how often we do a job, and what we have saved our customers to date that they would have paid out of their own pocket for the water and sewer line repair on their own property. Um, and we are also a strategic partner of the ICMA, International City Management Association, something we're very proud of. And the League of Oregon Cities, we have been a business partner with them since 2018 and have a very strong relationship with them. Matter of fact, one of the reasons I'm here is because I'll be at the spring symposium in Pendleton. So, if any of you are going to be there, I'll be at booth number 14. Stop by and chat with me if you would like. Excuse me. So basically the reason our program exists is because of aging underground infrastructure and that's a problem on both sides of that equation. What I always like to say is while there's that dividing line of where that responsibility begins and ends for each entity, it's still all interconnected. So a problem on one side can become a problem on the other side and vice versa. One of the big issues with this is water and sewer lines that homeowners are responsible for out of sight, out of mind. Most of the time they don't even know it's their responsibility till something happens and then they pick up the phone and they call the city and find out that it's on their property and it's theirs to deal with and that's typically not a very pleasant conversation to have. Um, so there's that issue that they're not aware of it. And then the other issue is they find out that those repairs are not covered by their homeowners policy either. Now they're mad at the city. They're mad at their insurance agent. Sometimes they're

even mad at the realtor who sold them the house. I've heard stories from council members who are real real estate agents that 6 months after they sold someone a home, the sewer line collapsed and they're like, "Did you know about that when you sold me this house?" So, not a good scenario for homeowners to have to deal with because where am I going to get that money now? And that's the big issue. Basically, that bottom bullet point there to me is the key. 60% of homeowners with that household income 50,000 or less don't have any money set aside for these things. So really where our where our program really shines is with vulnerable populations. So if you think of uh seniors aging in place or first-time home buyers, those are the two demographics that really just don't have the finances or even the access to get the finances to handle these types of issues when they occur. So, some of the benefits of our program is we're the only service line program that's endorsed by the League of Oregon Cities. Uh there's no cost to the city for what it is that we do. There are no public funds used and it's completely administered by us. So, what that means is we bill homeowners directly when they decide they want to participate because this is something that's voluntary for them. Uh when they have a claim or a question for customer service, they're calling us. We have a contact center in Chattanooga, Tennessee. that's staffed 24/7 365 including holidays. So, they're always speaking with a live agent for any questions or issues that they're having. Uh, and also contractor management. This is something that's really important that I'm going to touch on a little bit more later, but we actually within the communities that we work, we will prevet and make part of our network local area licensed contractors to do the work when it's needed. Uh there is an optional revenue share for the municipality. Um I'll touch on how a little bit more on how that works as well, but that's something that's completely optional for the

municipality. You don't have to do that aspect. Um in every community where we're available, we really function first and foremost as a free public awareness campaign. We educate homeowners that it's their responsibility and give them a voluntary option. So, the nice thing about that is even people who choose not to participate for whatever their reason is, um, they've been informed and when something happens, they're less likely to pick up the phone and call the city. So, it reduces that staff workload of having to deal with those things. Uh, but by proactively educating those residents and the ones who do participate, they get the peace of mind that it really is a one call solution for them. They have our customer service number. When the issue occurs, they call us. We dispatch the contractor, the contractor does the work, we pay the contractor directly when the work is completed. So, it's really a a hassle-free experience for homeowners when these things occur. Um, some of the hazards that can be involved with that, of course, when they're doing that on their own is trying to find a contractor, trying to make sure they're not getting ripped off because it's an emergency, those types of things. Um, so we we take all that out of the equation and those contractors that we vet it vet, we make sure they're licensed, bonded, insured, have all the necessary equipment. Um, we do criminal background checks to make sure people that are being sent out in the community to do the work. Um, don't have any kind of, you know, felonies or anything like that because it's important to us that we're providing a quality of service and we're meeting the expectation that we promise to our customers and the communities where we're available. So, what we offer is two completely separate products. So, there's a product for the external water line and the external sewer line. For each of those, we offer up to $12,000 in coverage per incident. And these are for lines that are broken, cracked, leaking, have tree

root penetration, clogs, um a frozen external water line that needs to be thought out. really anything that that compromises the flow or operation of that water or sewer line falls into that coverage. There's no annual or lifetime limit. There's no deductible that a homeowner has to meet before their coverage begins. And there's no service fee either. So, when they call us and we dispatch a contractor, even if it turns out that the issue is not on the homer homeowner side, there's no charge for that homeowner for that contractor having come out come out. And the benefit there is that contractor is also going to inform you of an issue you might not be aware of that is on the public side of that line. Uh there's no pre-insspection of their property. So when a homeowner decides they want to participate after a 30-day waiting period, their coverage begins. So we're not sending somebody out to look at their property. We're not um asking them what the lines are made out of, how long they are, or any of those types of things. Uh they can opt into or out of the coverage at any time. And yes, that means somebody can get a brand new water line and say, "I don't want your coverage anymore." And that's just the cost of doing business for us. Um, I mentioned contractors and the toll-free emergency number. Um, and all the repairs are guaranteed, of course, as well. Of course, we strive to get it right the first time, every time. Excuse me. So, how the program works and is made available within the community, as I mentioned, there's no public funds used. We do this by direct mail only. So, there's no telemarketing. There's no door-to-door salespeople. We're not trying to disturb people or pressure them. We're trying to educate them that this is something that's your responsibility and here's something you can do about it. We do that up to two times per year. Not always, but up to two times per year. One of the benefits of this public private marketing agreement really what it is is the materials that we create to send to

homeowners, we send to our city partner first for review and input and approval before it's ever sent out to any homeowner. So until you say it's okay, it doesn't go. So that gives you oversight and uh transparency of what it is that we're doing within your community. You have a say in it. excuse me, that marketing information and that's before each one of those campaigns. Um, and that marketing information is very clear to the homeowner that it's not being provided by the city. It's through a partnership with us and that this is completely voluntary for them. So, they're not obligated to participate and that the two products are separate. So, they can buy one, the other, or they can ignore completely. We do ask for use of a city or a utility logo on that information along with your approval of that material once it's ready to go. And there's reasons for that. One that I mentioned is the transparency. You have oversight over that message. If we're saying something in there you don't like, it can be removed, altered, however you see fit. uh it helps to maximize the public education and it also validates to the homeowner that this is something that the city is aware of and that you have batted us before making this available in the community. And then of course overall it creates an economy of scale that allows us to offer the benefits that we do at the rates that we do. Um that's why we can do no deductibles, no annual or lifetime limitations, no services and so on. And of course they have the option of how they want to enroll. They can do it by mail, they can do it over the phone, they can go online, so they can check us out any way they would like before they make any kind of move. Excuse me. So, what we're doing for residents is we're educating them about what those responsibilities are and providing them an option um to be able to address those issues before they should occur. For municipalities, we're reducing the number of phone calls that you receive from people when they have these issues and reducing that staff

workload of having to deal with those issues. That timeliness of repairs can help uh reduce water loss from line breaks or hazards from sewer lines that have have collapsed or are leaking or what have you. Uh by using local contractors, we're putting money back into the communities where our program is available. And then of course money that residents save by not having to spend it on a water or sewer line issue. They can spend in other places like Nell's where I had dinner tonight for example. There's and as I mentioned there's no cost for the city to participate and there's that optional non- tax revenue share of 10% per product per month. So the way that works is when you participate in that aspect um the price of the product 10% of that acrus throughout the course of the year and every January we pay that out to our partner that participates you can send those funds anywhere you see them as needed.

So you're talking about the 10% goes to the city.

Correct. Okay. Correct. All right. Um what my experience has been is most of the uh partners that I know of that take that aspect participate in that will direct those funds towards low-inccome utility assistance programs um because they can use it to help more people. Those funds usually deplete pretty quickly and there's people that are left struggling with those utility bills. If you don't participate in that option, the price is 50 cents lower per month for residents that choose to participate. So really, there's a benefit either way. Either you get some funds that you can do some things with or residents save a little bit on the price of the products. As far as Oregon, these are the cities that we are currently working with. Um, so you can see all various sizes

west side and I'm sure there's some that are, you know, familiar to you since you don't live in Oregon. Um, but you can see the number of partners that we have, how many customers we have with how many protection plans that are in place. Um, the number of jobs that we've done and how much we have saved our customers here in the time that our programs been available in the state of Oregon. And that's been since 2018. I'm sorry. since 2018 in Oregon. Was that what it was at the beginning you said? No, that's what that's when uh our relationship with the League of Organ City began. Oh, gotcha. So, we've been available in or I think the

the first partner was Cottage Grove and it was before I was hired by the company. So, don't hold me to this, but I believe that happened around 2012. Okay. Okay. Okay.

Yeah. So, it's been a while. So, just kind of a summary or an encapsulation of what it is that we do is we help educate residents on what those responsibilities are before they have an issue so they can choose what to do about it or how to prepare for it before it becomes a problem. Um so what it does is it helps enhance the quality of life within a community by helping those residents out when they need it the most and also reducing the workload that staff has when they have to deal with these types of issues. And that being said, um there's my information. You can reach out directly to me if you have any additional questions, but at this time, if there are any questions or comments that you have, I'm happy to answer.

Stu, do you know how frequently this happens on the I didn't ask Kyle that question ahead of time, but um he one of his concerns was just the that I think Dennis did a good job addressing was the confusion. Is this a city program or not? And I think I've had friends where that happened and they I know how much it costs and Yeah. Right. Um but I I was just wondering how frequently we have to ask. Yeah. Right. I mean are we saving the city, you know, five phone calls a year or Yeah, I'll write down the question, but yeah, we'll have to keep asking.

So I have a question. So basically this is kind of a home protection program for sewer and for the water lines. Correct. Yes. Okay. Only. Yeah. Okay. It's kind of an area that's a no man's land where homeowners insurance doesn't cover it. The city doesn't cover it. So people are just kind of left to fend for themselves. Okay. So this gives them an option that they can participate in where they can have that kind of coverage without the deductible and the hassles of finding a contractor and so on. And it's entirely up to them. Yeah, they get to choose whether or not they want. How much does a policy cost? Yeah. Excuse me. So, without that revenue share, the water coverage is $849 a month and the sewer coverage is $1149 a month.

With the revenue share, $20 if they wanted both. Correct. So, about 20. So, if if you we did do the share the 10%, how much would that be? Depends on how many. Well, I know, but I mean I'm just saying is that is that the same price as $8.45? Uh, it's well, it would be $8.99 and $11.99 because it would go up participated in that and then 10% of that would go into that acrual that we pay out every January and it's entirely dependent on the number of plans that are in effect. So when homeowners participate, that's why we call it incremental because that's more what typically happens is people start to participate,

a neighbor notices somebody having some work done in their yard. Oh, hey Fred, that must be really expensive. I see that big trench I got. Oh no, I had this actually took care of it. And you know, word of mouth starts to take over as well when people are experiencing issues and sharing that with friends, relatives or whatever of hey, I had this issue and they took care of this and they can sign up at any time. Correct. Mhm. That just And you only do mailings twice a year to inform people of it. Correct. We're not looking to inundate them, right? You know, we're we're not trying to be like uh um you know, Pepsi or Coke that are just in your face constantly. It's more of a hey, here's a reminder. This is something you're responsible for. And if anybody doesn't want to receive our information, they reach out to us and we removing them from our listing.

That's cool. Just to be clear, the 10% is 10% of the 50 cents. Oh, 10% of the total of the total total. So 10% of 8.99 and 10% of 11.99. That's nice. Thank you. Yeah. Yeah. And then they do it yearly. So sounds like a win-win, but there's always downfalls in something, you know. But I think it's neat because people can choose. Correct. You know, I mean, people may not want it, people may want it. It's just another option for them.

I think some of the concerns that Kyle had were of the the city logo use and what the confusion might be if it it's going to increase their call volume or decrease it. Obviously, that's one of his concerns. And then, you know, working with the good news is we live in a small community. They know most of the contractors already, but one of his concerns was how do you make sure it's the the service line and where the break is and whose responsibility it is. But I think that the way you presented it, the contractor handles that whether it's on the public or private side and then would notify the city if it's on the public side and then work to get that addressed through public works

and all the repairs or replacements are done to whatever your codes and ordinances are. Um, when it comes to lead lines here, I don't know how much of an issue you might have with lead water lines here, but when it comes to lead lines, we don't repair those. We replace them. Galvaniz, same thing. We don't repair, we replace. I think there's plenty of galvanized in the city at least. I'm not sure about that. It doesn't seem to be as big an issue in Oregon as it is in other states. What about all those other Westside cities that, you know, participate in whatever that they're using locals? Have you ever heard any conflict from people thinking, "Oh, well, the city's logo is on there or whatever," like he was just addressing.

So, occasionally, um, you know, some of our partners will get some, uh, inquiries from homeowners as to, "Is this a city program?" But once, excuse me, once we're established in a community and they're seeing that information, they know. Um, but yeah, you'll get some people that might inquire as to, you know, what is this I'm receiving? Is this through the city? Gotcha. Um, as I was uh telling Stu earlier when we were were talking about it, one of the things we do when we partner with a community, when a community decides to move forward with the program is we have an onboarding call where the uh account manager that works with the city moving forward to provide the materials to get your approval uh to provide updates on how the program's performing in the community, how many people are participating, how many plans, how much we've done in repairs and those types of things. Um, goes through the process of what we do in our launch, which is vetting contractors first and foremost. That's the most time consuming aspect. Um, excuse me. Um, and we then provide staff with FAQs with the idea being if somebody does call in to ask a question of the city, here's a quick one or two sentence answer and here's the phone number they can give you more details. So, the idea is to make less work for you, not more work for you.

I have a two-part question. Sure. First of all, why do you use the city logo? Number one, and the other part is um Oh, I forgot the other part. Shoot. Um, it was with that. I mean, or do you have a disclaimer that this is not a city program? Correct. Do you put that in there? Yes. Okay. Why do you use a city logo? Just for curiosity. So that's what makes it one into a mass education piece because if people are getting information just from us, it's junk mail. They don't know who we are. So they're not being informed. They might miss out on the opportunity to participate.

I'm sorry my uh well just just to interrupt briefly. It's also as you described educational piece where the the citizens know now it's my responsibility on my side of the leader right sometimes they expect that's the city's problem all the way up to my foundation you know correct and I know Kyle feels those phone calls so one of the key education components is you're responsible for this piece and the city's responsible for this piece which is covered in some of that material I understand yeah and then it's also the transparency okay so if we didn't have that partnership with you we could create any information we wanted and just mail it. So, it's kind of like our approval to correct. Okay, that makes So, you having a say over that message,

you know, you're keeping somebody from coming in and just trying to scare everybody. Okay, makes sense. Okay,

so the sort of decision to make tonight is no, we don't want to proceed with this. We want to have a we want to be added to the May council agenda for a a bigger conversation with Kyle and other staff involved in a in a public setting obviously. Um and then um and then a followup obviously making authorizing the city manager to enter into some sort of more conversation and agreement. I think you want to talk about the three-year

Yes. So the standard agreement because it takes a while for it to ramp up for people to participate. Um, we enter into a three-year marketing agreement with the community. Um, we have it all created already. Once a city has decided that, hey, this is something that we've approved, we want to move forward with, we provide that agreement. Your attorney reviews it, makes any red lines, we go back and look at that, and yeah, we're good with that, what have you. Once we get settled on what that agreement is, um, you know, it's in place for three years. However, there's no stipulation on how many times we have to mail in that three years and you as a city have control over that. Um, so as I was explaining to Stu earlier, if you had some kind of massive infrastructure project going on, for example this pretty common, you got a massive infrastructure going on on the public side, and you don't want that information going out during that project because you don't want to confuse residents with, hey, we're doing this big public thing, but this is something that's for you on the private side.

You can simply tell that account manager who has sent you the materials, this is not a good time for it. let's revisit that in six months or what have you. So you have control over whether or not that mail was ever sent. I think May would be a good time where we can discuss it more with more definitely Kyle being in the room so we can ask questions. Yeah. Yeah. Do you want to move forward with with um just discussion or an actual motion to I would say discussion first and then we could decide if there would be a motion. Okay. So really not. So we could probably even do that maybe during we're missing two of us too. Um I'm just like city manager staff comments. Would that be more appropriate?

I think so. I'm only thinking of gathering stuff that I have to do on my end. So that would make it a lot easier for me. I think more discussions then from the discussion then we decide if we want to move forward. Okay. Yeah. And then we can move it forward if we do in June. Correct. So, you're thinking staff comments or new business? I guess we could just throw it into new business. I think new business might have discussion, right? Yeah, it would fit better. I think so. Yeah, it's it's probably more transparent for people to know we're discussing it then. That makes sense. Yeah. Yeah. Because then it'll be on the agenda and Yeah. Yeah. I think that's presented so we can ask some questions.

Yeah. Like it. Sounds good. poor Kyle. He's a big boy. The conversation actually started with Kyle a couple years ago and then some projects got in the way and that's when I saw your city manager in Portland and he approached me and started asking me some questions. He's like, "Yeah, we need to, you know, I I like this. We need to take a look at this closer." So that's how I got here today. Good. Good. Any more questions? I didn't Well, we have Dennis here. Do you guys have any more questions for him? It's pretty straightforward. Yeah. Well, thank you for your time, Dennis.

I appreciate your time as well. It's my pleasure. Thank you so much. And excuse me with that. I'll excuse myself so you guys can wrap things up. With that, we're done. Oh, well, there you go. I want you to wrap it up.