Note: These Minutes were approved by the Board on 3/23/11.

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1 Note: These Minutes were approved by the Board on 3/23/11. SPECIAL BOARD MEETING Station # Southwest Drive Multipurpose Room Tuesday, February 1, :00 PM ~ MINUTES ~ I. CALL TO ORDER/ROLL CALL. Board Present: David Blauert Chairman; Phyllis Erick and Craig Dible Members Board Absent: Charles Christensen Clerk; Ty Montgomery Member Others Present: Nazih Hazime, Fire Chief Sandi Schmidt, Finance Manager Bob Motz, Telecommunications Manager Tricia Greer, Recording Clerk Terry Keller, Assistant Fire Chief Kris Capite, Finance Assistant Mark McClaskey, IT Lead 2 Members of the Public II. SALUTE TO THE FLAG OF THE UNITED STATES OF AMERICA. Chairman Blauert called the meeting to order at 2:04 PM and led the Pledge of Allegiance to the U.S.A. III. PUBLIC SESSION. A. Discussion with ADP Representative Re: Employee Check-In System / Time Clock. Due to a technological problem, the web-based teleconference was delayed. Betsy Boardman, Major Account District Manager; Ann Colquitt, Sales Executive; and Ron Vallee, Solutions Consultant, with ADP introduced themselves via telephone conference call. Copies of the PowerPoint from Ms. Boardman were distributed to the Board; she then began her presentation, summarized below: Agenda: Introductions Areas of Interest Benefits of Automating Time & Attendance Enterprise etime Demonstration Proposal Sedona Fire District Areas of Interest: Integration Automation Employee Accountability Key Benefits of Automating Time & Labor Tracking: Managers get up-to-the minute hours, totals, and leave balances, so they can make labor allocation decisions and approve leave only when it is appropriate. Employees record their hours directly into a computer. Supervisors review, edit, and approve them without needing to print anything out. Reduces payroll preparation by up to 80%; staff can be reallocated to profit-producing activity. Up to 3% of all payroll inaccuracies are caused by human error. Time Off Overpayments: With a manual time-off process, errors occur. Robert Half and Associates and SHRM studies show 20 to 50% of time off is unreported in a manually tracked environment. On average, an employer will pay 8 hours of unearned PTO time per employee per year.

2 Total number of Employees 120 Average Unearned PTO Hours Paid Per Employee 8 Total Liability $9,600 Accuracy of Employee Hours: An error in timekeeping results in overpayment or underpayment of employees. If the error is discovered, it means an adjustment, either on the next pay period or the issuance of a new check. Both solutions cost your company money. The American Payroll Association (APA) says a typical company will be 94% to 99% accurate. The annual accuracy savings are the savings realized by recapturing erroneous payments. Number of hourly employees 120 Average Pay Period Hours Worked 40 Total Hourly Payroll Weekly $48,000 Annual Hourly Payroll $2,496,000 Accuracy Factor 99% Annual Accuracy Savings $24,960 Lost Time Savings: APA estimates employers overpay 6 minutes per employee per day for long lunches/breaks, late starts, early outs, and unapproved time from the job. By implementing policies and rules, as well as biometric timekeeping devices, time can be accurately captured, enabling employers to eliminate overpayments. Number of hourly employees 120 Daily Hours Lost 12 Weekly Hours Lost 60 Annual Hours Lost 3,120 Annual Lost Time Savings $31,200 Ms. Boardman said Board Member Craig Dible talked to her last week about this system, which would eliminate the manual process. Finance Manager Sandi Schmidt pointed out SFD does not currently have a manual system, as it is automated through our Telestaff program. An electronic demonstration of the time-clock component, Enterprise e-time, was then presented by Mr. Vallee and questions were entertained. Chief Hazime asked if an employee s time could be entered remotely. Mr. Vallee replied, this time clock is designed to be mounted on the wall with employees swiping in and out. He said different methods could be customized at an additional cost for capturing employee time in the field, using browser based applications; he said ADP has partnerships with companies to customize mobile data collection. He explained the software that exists would allow supervisors to have access to make sure employees are clocking in and out appropriately. Supervisors can also be given the ability to update an employee s time sheet on their behalf. Reports would indicate which supervisors updated employee time information. Once time cards have been approved by the supervisor, all access by employees to the time card is blocked. Mr. Dible asked if, rather than have the person in the field looking for a way to clock in through a Smart phone or computer, would the supervisor on behalf of the employee edit or enter info from his computer terminal. Mr. Vallee said the system could be programmed to grant backup to some supervisors and SFD can define the role of the software. Telecommunications Manager Bob Motz asked Mr. Vallee about the connection method from ADP to SFD; Mr. Vallee said SFD would host the server in its environment; Mr. Motz asked if from the server, SFD would VPN through a connection to payroll; Mr. Vallee said the system would interface through an electronic path into payroll. Page 2

3 Mr. Vallee showed Quicknavs would indicate missed time punches, allowing supervisors to correct them leaving an audit trail, and also in real-time as the information is being accumulated. Mrs. Erick asked about holiday hour tracking and would supervisors have to manually put in that time. Mr. Vallee said holidays would be built into the application, and every year an updated holiday calendar would be added. He said the rules on how, who, and when to compensate would be part of the application; if policies or pay schedules change, those could be added to the system as they occur. Chief Hazime asked Mr. Vallee how ADP would interface with our current Telestaff system, and Mr. Vallee explained some of their partner companies could customize software to integrate with Telestaff. Mr. Vallee said employees could access their own pay information to find out accrued hours, holidays paid, and more, through kiosk machines in the stations or through Internet Explorer. Mr. Blauert asked about the confidentiality of the system; Mr. Vallee said accessed information can be defined and by whom; he said if you want supervisors to know hourly pay rates of employees, it would be available. Mr. Dible asked if employees would only have access to their own information and he replied, yes. Mr. Dible asked if a tutorial or training module would be provided; Mr. Vallee said, yes, and ADP would have a dedicated team to work specifically with SFD to help employees understand the system, and there is a Help section in the application with a search for key terms. Chief Hazime asked, for fire agencies, the average time supervisors would be required to review the time cards of their employees; Mr. Vallee said studies have shown, one time card takes about seven minutes for supervisors to review in a manual environment and 80% of the time looking at time cards could be eliminated due to automation with better accuracy. Mrs. Erick asked if Board Members wanted to access payroll reports, would they contact ADP; Mr. Vallee said they would request reports from the Fire Chief or payroll staff; he also said reports could be distributed via on a quarterly, monthly, or even, weekly basis. Mr. Blauert commented that saving five minutes of time reviewing time sheets times 100 employees could be a significant cost saving. Chief Hazime commented SFD has an automated system through Telestaff, and asked a projection of what the savings would be, knowing that system is already in place. Mr. Vallee said he thought SFD was using Telestaff only for scheduling purposes; Mrs. Schmidt said payroll is totally automated and was integrated by a third party to have information dumped into ADP from Telestaff. Mr. Vallee asked if Telestaff was capturing time and attendance; Finance Assistant Kris Capite said SFD contracted with Simonson Consulting to create a bridge to exchange information between Telestaff and ADP. Ms. Colquitt from ADP said she believed the difference with e-enterprise would be rounding rules and policies applied to the hours, totaling hours, notifying of employees reaching overtime, and automated time off. Ms. Capite said Telestaff already does those things. Mr. Valle said ADP would create more accountability using time clocks, as indicated in the presentation and the beauty of Enterprise solution is the flexibility of managing, but he does not know the full functionality of Telestaff. To a question about holiday automation, Ms. Capite responded SFD currently handles holiday pay in batches, whether Operations or Administration (12 or 8 hours of holiday pay) for each type of hour paid. Chief Hazime said he would be interested in knowing if this ADP system would streamline our process. Ms. Boardman then referred to the Proposal section of the presentation, as follows: Workforce Now Expanded Time & Attendance Monthly Fee (Based on 125 employees) $400 Monthly Clock Fees (Per Time Clock) $ 175 One-Time Implementation Fees $20,000 Reoccurring Annual Total $6,900 3 Peat Promo Buy 1 Get 2 months free (during 1 st year) $800 First Year Annual Total (for one time clock) $6,100 Page 3

4 Ms. Boardman said this is the initial proposal without some of the features discussed such as interfacing with Telestaff and other customization for the field. Mr. Blauert asked what would be the cost to update the system yearly for policy changes, etc.; she said there would be no further cost associated. Ms. Boardman said she would research interfacing with Telestaff to see if ADP could adjust the cost into the implementation fee. Mr. Motz asked about the price and specification for the necessary server hardware; she replied she would have to get back to him with the information. Ms. Boardman pointed out this proposal includes subscription/leasing for the time clock, rather than ownership, mostly due to maintenance; if repair is needed, the unit could be switched out by ADP; Ms. Capite asked about the turnaround time for the replacement clock, to which Ms. Boardman replied, 24 hours. Mr. Dible asked her to break out the details of the one-time implementation fee; Ms. Boardman said it includes all necessary training, configuration of software, applying all rounding rules in policy, going through the process, customized configuration specific to SFD and Quicknavs customized per specifications. The Board then thanked her for her time and concluded the teleconference call at 3:12 PM. Mr. Blauert asked how many time clocks SFD would need; Mrs. Schmidt replied about eight; Mr. Blauert asked if it could work with just one per station. Mrs. Schmidt replied she talked to the City of Sedona, which has a similar system, and they have two at City Hall one for Administration and one for the Police Officers, as they have different entry areas. Mr. Blauert commented from the presentation, it seems there could be a substantial savings per year with this type of system. Chief Hazime said the possible savings would need to be explored thoroughly because the presentation included savings for a totally manual system; he asked Mr. Blauert if the Board would be interested in another presentation showing all the features of Telestaff; Mr. Blauert agreed and asked it be included on the 2/9/11 Agenda; he commented from the figures presented, SFD could realize a $750,000 savings over the next ten years; Mrs. Schmidt replied, not necessarily, because the figures did not represent hard cash, but rather, possibly, an internal time-saving benefit. Mrs. Erick commented accountability for errors is valuable. Mrs. Schmidt said SFD staff currently runs a payroll report every two weeks to verify employees time keeping; Mrs. Erick said there was no accountability for being a half-hour late; Mrs. Schmidt replied, if that is what the Board believes is an issue, they need to understand all crews come together at the beginning of each shift to transfer the watch with the preceding shift, and if any employee is late, a member of the preceding shift would stay; this is due to minimum staffing requirements. The accountability is managed peer to peer. Chief Hazime said the crews come in, generally, before their shift begins and do not get paid overtime; additionally, if a Rover crew member had to be transferred to another station to cover, they are not paid any additional pay for moving from one point to another. Mr. Dible said he likes the accountability factor of the system, the employees are responsible for taking care of their own timekeeping, the real-time format, report generation, and employees being able to see their own information, and the oversight of a supervisor being able to log in remotely for an employee not on site; he said the only issue is to make sure it is worth the additional expense. Chief Hazime said besides ADP and Telestaff, staff is exploring other time-keeping options; Mrs. Schmidt said Telestaff has a time-keeping system it did not have when SFD began using it; Chief Hazime said that would enhance a system we already have in place. Mrs. Erick asked how much it cost for Simonson Consulting creating an interface between ADP and Telestaff; Ms. Capite stated she would find that information and provide it to the Board. Assistant Chief Keller stated his concern is the possibility of losing time the crews are now providing at no charge; the fire service is 24/7/365 coverage and currently, when one shift comes on, they come in early to relieve the outgoing shift in case a call comes in at shift change; the firefighters are donating that time; however, if the Board decides to go to a time clock system, the crews may be standing around the kiosk, waiting to punch in at exactly 7:30 AM; he spoke with an officer at the Sedona Police Department who reported that is what police officers do since they got a time clock. Chief Keller said he does not believe this system will save overtime costs, and might increase it. Mrs. Erick replied that everything is adjustable and there Page 4

5 is flexibility in the time clock system; she suggested we continue researching before saying it is impossible. Chief Hazime said that is a point well taken. Mrs. Schmidt replied staff is looking at another company, Tyler Technology, which may have possibilities of usage more than just payroll time-keeping; it creates a finance system for accounts payable, receivables, budgeting, record retention, a bar code inventory system, human resources, payroll, etc. She saw a demonstration of Tyler at the City of Sedona. It is web-based and because of the bad economy, it may be possible to get the entire system for the cost we currently pay ADP. She suggested rather than being solely focused on payroll/time card issues, it may be worth looking into big picture options. Mr. Blauert commented that has merit and the Board is in no hurry to purchase a system; he would prefer staff take its time, do it right, and make sure we are getting a system that improves what we currently have. Mrs. Schmidt also said we should have a Request for Proposals process to find the bestfit product; and also, that Tyler Technology is on government contract pricing. Mr. Blauert agreed they want to be prudent for the people they represent. Mrs. Schmidt said staff would continue researching Telestaff and other options to save money on implementation fees and other areas that companies could reduce if they want the business. Mr. Blauert then asked if the public had any comments. Karen Schmidt: The Board has been very vocal about competitive bids in the past, and I didn t get the impression we were going to have competitive bids. So, until you spoke up that you re going to look at other places. I m glad to hear that and I m wondering if you know of any other fire departments in Arizona that are using this or a similar system. Mr. Blauert said he did not, but was sure we could find out and that the Sedona Police Department has had a similar system for more than a year and is very happy with it. Mrs. Schmitt continued: About 50 years ago, Mike was with a company that took out the time clocks and they had a huge increase in productivity from employees. When you re treated professionally, it tends to make you act professionally. And the converse is also true and Mike has a comment on that. Mike Schmitt: I used to work for IBM back in 59 and IBM makes the time card punch-ins, the little 3 by 5 cards that punch holes. All the employees were required to punch in and after one year, they took them out at IBM because they found out that the employees got the impression that they weren t trusted by their management and, my question really is, has the Fire Board considered how instituting this timecard punching in daily business is going to affect the firefighters attitudes and feelings, that they are not trusted to fill out their own timecards and hand them to their managers. Firefighters, I remind you, are highly trained professionals. They are not minimum wage unskilled workers. They should be treated with respect. You may realize a $750,000 savings in ten years by implementing this system of micromanaging, but is it really worth it to risk losing your best firefighters, or even the Fire Chief, by lowering the morale of your employees? That s all I want to bring up. It s something to think about. Thank you very much. Mrs. Schmidt commented management is not opposed to implementing a time clock system, if the Board wants the accountability of employees punching in, but something different would have to be purchased; she is not sure even the Telestaff time-tracking system would mean employees literally punching in to a time clock; she wanted the Board to understand that SFD s current system is totally automated, and Telestaff also allows supervisors to see who last edited an employee s time card and how many times. IV. ADJOURNMENT. Mr. Blauert thanked all for their participation and adjourned the meeting at 3:35 PM. Original signed by Charles Christensen Charles Christensen, Clerk of the Governing Board :tg Page 5

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