On the agenda: Danvilleva City Council Work Session — Data Center (Jan 2)

DANVILLE CITY COUNCIL WORK SESSION AGENDA
MUNICIPAL BUILDING
January 2, 2018
7:30 P.M.

MEETING CALLED TO ORDER
MINUTES
A.

Consideration of Approval of Minutes of Special Work Session held on December 5, 2017 and
Regular Work Session held on December 5, 2017.
Council Letter Number CL - 1814.

WORK SESSION ITEMS
A.

Consideration of Appointments to the following Board:
Council Letter Number CL - 1820.
1. Fair Housing Board

PROGRAM UPDATE
ECONOMIC DEVELOPMENT UPDATE
COMMUNICATIONS FROM
A.

City Manager

B.

Deputy City Manager

C.

City Attorney
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D.

City Clerk

E.

Roll Call

CLOSED MEETING
As Permitted by Subsection (A)(3) of Section 2.2-3711 of the Code of Virginia, 1950, as amended for
discussion or consideration of the acquisition of real property or of the disposition of publicly held real
property; and
As Permitted by Subsection (A)(5) of Section 2.2-3711 of the Code of Virginia, 1950, as amended for
discussion concerning a prospective business or industry related to economic development.
A.
B.
C.

Motion to Convene in Closed Meeting
Motion to Reconvene in Open Meeting
Motion to Certify Closed Meeting

ADJOURNMENT

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CL-1814
Work Session Meeting

Meeting Minutes

Item #: A.

Meeting Date: 01/02/2018
Subject:
From:

Consideration of Approval of Meeting Minutes
Susan M. DeMasi, Clerk of Council

COUNCIL ACTION
Work Session: 1/02/2018
SUMMARY
Consideration of Approval of Minutes of Special Work Session held on December 5, 2017 and Regular
Work Session held on December 5, 2017.
Council Letter Number CL - 1814.
Attachments
Meeting Minutes
Meeting Minutes

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December 5, 2017s

A Special Work Session of the Danville City Council convened on December 5, 2017 at 5:34
p.m. in the Fourth Floor Conference Room of the Municipal Building. Council Members
present were: James B. Buckner, L. G. “Larry” Campbell Jr., Mayor John B. Gilstrap, Vice
Mayor Alonzo L. Jones, Dr. Gary P. Miller, J. Lee Vogler, Jr., Sherman M. Saunders, Fred O.
Shanks, III and Madison J.R. Whittle (9). Mr. Campbell entered the meeting at 5:35 p.m.; Mr.
Vogler entered the meeting at 5:39 p.m.
Staff Members present were: City Manager Ken Larking, Deputy City Manager Earl B.
Reynolds, City Attorney W. Clarke Whitfield Jr., and City Clerk Susan M. DeMasi.
Mayor Gilstrap presided.
ECONOMIC DEVELOPMENT UPDATE
Director of Economic Development Telly Tucker explained these items relate to the two
resolutions Council will be voting on tonight. Several months ago, Council discussed a $1M
grant application to the Tobacco Commission for a 30,000 square foot shell building at the
Cyber Park on Lot12B, which is at the corner of Slayton and Stinson. The Resolution of
Support enables Mr. Tucker to apply for the grant, it will come from the Southern Area
Allocation, and will require a one to one match from the locality. If approved, it will come back
to Council to approve the receiving of the grant and discussion about the details of the
construction. Staff has received a letter of support from the Danville Area Development
Foundation and the Danville Industrial Development. They have agreed to cover the interest
on a loan for a period of up to two years so that the City does not have to put up any money
directly. The format would be similar to the shell buildings done in the past. The IDA would
most likely take out a loan, the DID or DADF will pay the interest for a period of two years and
ultimately, if the building has not been sold at the end of that time period, the City or the IDA
would have the option to refinance the building, bond or purchase it. In response to Mr.
Saunders, Mr. Tucker noted Pittsylvania County is also applying for a $1.5M grant which they
will have to match, for a second shell building in Cane Creek. Mr. Tucker explained the second
resolution is in support of Project Lignum; that request is being made by RIFA to the Tobacco
Commission to use $1.1M of both the City’s and the County’s allocation toward grading a lot
in Berry Hill. That money will go into the ground to prepare a site. If the project does not
move forward, that money would be returned to the allocation. This is a proactive step to
apply so if and when Project Lignum states they are moving forward, the funds are in place to
begin bidding the grading project. The grading costs associated with that also include state
monies and an additional TROF grant which does not require a match. Mr. Tucker explained
all that will be poured into getting the company a site ready pad. The investment is made in
RIFA’s asset as opposed to going to the Company.
CLOSED MEETING
At 5:48 p.m., Vice Mayor Jones moved that this meeting of the City Council of Danville,
Virginia be recessed and that Council immediately reconvene in a Closed Meeting for the
following purposes: discussion or consideration of the acquisition and/or disposition of real
property for a public purpose where discussion in an open meeting would adversely impact
the bargaining position of the City as permitted by Subsection (A)(3) of Section 2.2-3711 of
the Code of Virginia, 1950, as amended; and an Economic Development discussion and
update concerning prospective business or industry where no previous announcement has
been made and/or the expansion of an existing business or industry where no previous
announcement has been made as permitted by Subsection (A)(5) of Section 2.2-3711 of the

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December 5, 2017s

Code of Virginia, 1950 as amended; and discussion or consideration of the investment of
public funds where competition or bargaining is involved, where, if made public initially, the
financial interest of the governmental unit would be adversely affected as permitted by
Subsection (A)(6) of Section 2.2-3711 of the Code of Virginia, 1950 as amended.
The Motion was seconded by Council Member Campbell and carried by the following vote:
VOTE:
AYE:
NAY:

9-0
Buckner, Campbell, Gilstrap, Jones,
Miller, Saunders, Shanks, Vogler and Whittle (9)
None

Upon unanimous vote at 6:58 p.m., Council reconvened in open session and Vice Mayor
Jones moved adoption of the following Resolution:
CERTIFICATE OF CLOSED MEETING
WHEREAS, the Council convened in Closed Meeting on this date pursuant to an affirmative
recorded vote and in accordance with the provisions of the Freedom of Information Act; and
WHEREAS, Section 2.1-344.1 of the Code of Virginia, 1950, as amended, requires a
Certification by the Council that such Closed Meeting was conducted in conformity with
Virginia Law;
NOW, THEREFORE, BE IT RESOLVED that the Council hereby certifies that, to the best of
each Member’s knowledge, (i) only public business matters lawfully exempted from open
meeting requirements of Virginia Law under Section 2.2-3711 were heard, discussed or
considered, and (ii) only such public business matters as were identified in the Motion by
which the Closed Meeting was convened were heard, discussed or considered by the
Committee.
The Motion was seconded by Council Member Vogler and carried by the following vote:
VOTE:
AYE:
NAY:

9-0
Buckner, Campbell, Gilstrap, Jones,
Miller, Saunders, Shanks, Vogler and Whittle (9)
None

MEETING ADJOURNED AT 6:54 P.M.
APPROVED:

ATTEST:

______________________________
MAYOR

______________________
CITY CLERK

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December 5, 2017

A Regular Work Session of the Danville City Council convened on December 5, 2017 at 7:49
p.m. in the Fourth Floor Conference Room of the Municipal Building. Council Members
present were: James B. Buckner, L. G. “Larry” Campbell Jr., Mayor John B. Gilstrap, Vice
Mayor Alonzo L. Jones, Dr. Gary P. Miller, J. Lee Vogler, Jr., Sherman M. Saunders, Fred O.
Shanks, III and Madison J.R. Whittle (9).
Staff Members present were: City Manager Ken Larking, Deputy City Manager Earl B.
Reynolds, City Attorney W. Clarke Whitfield Jr., and City Clerk Susan M. DeMasi.
Mayor Gilstrap presided.
MINUTES
Upon Motion by Council Member Shanks and second by Council Member Campbell, Minutes
of the Regular Work Session held on November 9, 2017, were approved as presented. Draft
copies were distributed to Council Members prior to the Meeting.
WORK SESSION ITEMS
CONSIDERATION OF APPOINTMENTS TO THE DANVILLE PITTSYLVANIA REGIONAL
INDUSTRIAL FACILITY AUTHORITY
The City Clerk explained these appointments are normally considered by the City Council.
Mayor Gilstrap noted the two present members are Fred Shanks and Sherman Saunders, and
Alternate Member Lee Vogler. Mayor Gilstrap questioned if the current members wished to
continue and they indicated they did; there were no objections from Council Members. The
resolutions for these appointments will be presented at the next business meeting of Council.
CONSIDERATION – ACCEPTING FOUR NISSAN LEAF ELECTRIC VEHICLES AND
CHARGERS
City Manager Ken Larking noted the City has Nissan Leaf vehicles plugged into various
stations around the City; they have been used by the departments for free by a company that
offered them to the City. Director of Utilities Jason Grey explained the company, Fermata,
are originally from UVa and are designing several different vehicle to grid products, partnering
with several local companies in Danville. They are at the end of their two year Tobacco
Commission grant; they cannot sell the assets, they have to give them to someone within the
Tobacco Commission footprint. Mr. Grey noted there are two vehicles at City Hall, and two
are at Wastewater.
Mr. Buckner questioned if Mr. Grey knew what the usage for electric vehicles is in the City
and Mr. Grey noted he did not know how many were used. Mr. Buckner asked if the City
should look at, in certain public parking areas, installing some electric vehicle chargers. Mr.
Grey explained the City may want to do a feasibility study to see how many people are
interested. In response to Dr. Miller’s question if there is usually a charge, Mr. Grey stated
there is. There is a company that has an App and people charge their cars using the App on
their phone. Mr. Vogler noted Michael Philips with Virginia Clean Cities, who helped the City
with the change to propane fuel, mentioned wanting to donate a station or two to the City for
electric vehicles; that may something the City would want to revisit.

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December 5, 2017

Mr. Whittle questioned when the City gets the vehicles, do they take on the maintenance as
well, and Mr. Grey noted the City would be responsible for any maintenance costs after the
Company gives the vehicles to the City.
Council agreed to put this on an upcoming business meeting.
Mr. Buckner asked Mr. Grey to start a study to see if electric chargers would be beneficial in
the City. Mr. Larking stated if Mr. Vogler gets in touch with the person who offered free
chargers, staff could connect with him and see what makes the most sense on where those
should be located. The City could judge how many people are using them by seeing how
many use the free ones; if they get regular use and if it looks like the City could use more,
they can look into that. Mr. Vogler noted he would reach out to that person.
REVIEW OF RETIREE AND EMPLOYEE BENEFIT CHANGES FOR 2018
Director of Human Resources Sara Weller stated staff gives an annual update on employee
benefits for the upcoming insurance year. The City had a challenging renewal this year,
utilization was extremely high which affected that. Carrie Bartlett from One Digital Advisors
has been working on the City’s account; Brett Jackson, the CEO of Gateway Health and Chris
McFarling, the City’s account manager with Gateway Health were also present. Ms. Weller
explained when the renewal came back, they worked very diligently with Ms. Bartlett, the City
and SOVAH to help meet that challenge and get the City’s renewal down.
Ms. Bartlett reviewed her PowerPoint presentation 2018 Employee Benefits Renewal Review
(a copy of which has been retained in Laserfiche, in the City Clerk’s folder, Presentations to
Council.)
Ms. Bartlett began with the Executive Summary, stating the medical renewal this year was a
41.2% increase which was $3.6M. They worked with their team at Gateway, as well as
obtained updated claims information and were able to get the renewal down to a 30.5%
increase. Benefit changes were looked at to help mitigate that increase as well, and some
benefit changes were made. After that, the renewal was down to a 21% increase, which was
$1.8M. Ms. Bartlett noted the claims coming in for November have started to look better than
they have been historically. Mayor Gilstrap questioned if the $1.8M was the City’s portion and
Ms. Bartlett noted it was a combination of what the City was paying as well as employees.
Ms. Bartlett reviewed other benefits for employees which include voluntary dental plan,
voluntary vision, life and disability, FSA and COBRA administration. The dental program had
a 5% decrease resulting in a $30,000 savings for employees. They were able to get significant
savings in the life insurance program, about $82,000, by moving from the Hartford to the
Standard; they will be administering the disability program as well. The Flexible Spending
Account and COBRA administration are staying with Discovery Benefits who have
administered them in the past.
Ms. Bartlett noted Gateway worked with SOVAH and Duke hospitals to get reductions in how
things are charged to employees for services; long term, the City will continue to see savings.
Employees will also have access to preferred providers at no additional charge as well as
having access to some onsite education as well.
Mr. Shanks asked if Centra was approached and Ms. Bartlett explained initially the City’s
overall utilization is heavier at the SOVAH health systems and Duke; most of the City’s claims

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December 5, 2017

come out of there. There are some at Centra, and that is something they are exploring and
monitoring.
Ms. Bartlett stated the City is self-funded, which means it pays claims as they come in, and
starting in August of last year, the claims started going up; that was under the Anthem plan.
They continued to go up over the first six months of the plan year with Gateway and has
impacted the overall cost of the plan. There are stop-loss projections that gives the City
additional protection if claims exceed $150,000; the City had many claims that did that. Ms.
Bartlett noted recent claims look much better than they have in the past. Ms. Bartlett explained
health care reform or PPACA, is a very nominal impact at this point, only $4,200 total; most
of the fees have gone away. The City’s 2018 total premium is expected to be $10.8M, the
City portion is $7.4M and the employees are paying about $3.3M. They got updated numbers
from the renewal, have seen some shifts in enrollment, and they are going to work on what
that cost shift will be for the City.
Mr. Saunders questioned retired employees keeping healthcare benefits, and Ms. Weller
explained retirees have the option to continue the same insurance plan, the challenge is the
full cost of the insurance is extremely expensive. Employees are aware of this when they
retire, especially those retiring early and not Medicare eligible. Staff gives them places they
can shop and find other plans, but they are very expensive as well. The City is finding that
people are waiting to retire until they are Medicare eligible.
Ms. Bartlett noted when the City moved to Gateway, they made a change in the plans; they
made another change this year and focused on the more traditional copay based plan. The
deductible increased from $750 to $1500, and the out of pocket maximums also increased
from $4000 to $6000 for individuals. The $3000 and $5000 high deductible health plans were
maintained and are fairly standard from what is seen in the marketplace. The enrollment for
2018 looks like about 200 employees shifted out of the 750 plan into one of the other plans.
There were about 100 more in the 3000 plan and the 5000 plan almost tripled in size; more
people are enrolling in the high deductible plans. Ms. Bartlett reviewed the cost per month for
the plans for the employees, Health Savings Accounts that help with the high deductibles, the
City’s Wellness Program, Tobacco Cessation program, and noted the top chronic conditions
among City employees are Hypertension, High Cholesterol, Obesity and Diabetes.
Ms. Bartlett reviewed long term strategies including continuing to evaluate Reinsurance and
Pharmacy Management options, State options, and look at on-site/near-site clinics, and
explained they are looking at local and national options for some type of clinic to be available
to employees; the services they would provide is being worked through. Dr. Miller noted the
cost of setting up an office with all the equipment and nurse practitioner is very expensive,
would it be better to have a designated clinic in town that is contracted; Ms. Bartlett stated that
is part of what they are looking at. Mr. Vogler noted there is a company called Care Here,
essentially they are contracted out. Employees are getting regular care and it helps the
locality costs; Mr. Vogler noted he thought it would be very good for Danville. Ms. Bartlett
explained there are different options, there are companies that can come in and provide
services; they are also looking locally through SOVAH and Centra and other providers to see
if that is a fit. In response to Mayor Gilstrap, Ms. Bartlett explained if the City was not selfinsured, their rates would have gone up much more than they did, recommends going to
market every two to five years and feels the City has a great partner with Gateway.
Council thanked Ms. Bartlett for her presentation.

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December 5, 2017

DISCUSSION OF THE CITY OF DANVILLE’S NEPOTISM POLICY
City Manager Ken Larking stated at the last work session, he brought up this subject to gage
City Council’s opinion on whether or not they would be open to loosening the nepotism policy
in the upcoming version of the personnel regulations. If Council was willing to do that, and
gave the City Manager permission to implement it early, it would enable the City to have better
success in recruitment, particularly for public safety positions. Council asked Ms. Weller to
come to the meeting for a more detailed discussion on the topic and get consent from Council
as to which direction they want to see the City going.
Ms. Weller noted she reached out to other localities in Virginia and the feedback is there are
two policies, one is very similar to Danville’s, where the policy does not allow the hiring of
relatives within the same department. Danville’s is a little stricter because it limits hiring if the
person has access to Human Resources, IT or Financial information of the employee. When
Ms. Weller reached out to those localities and asked them about their nepotism policy, noting
the City was looking at loosening their policy, their response was, why would you do that. The
other localities, the majority of the localities, do not have very restrictive nepotism policies;
their policy pretty much states an employee cannot have direct supervision of a relative, which
is essentially the policy staff was discussing possibly implementing. When Ms. Weller spoke
with those localities, they didn’t have any issues or problems with it. Looking at the risk of
changes in nepotism policy, concerns can come up from a legality standpoint. If the City starts
hiring everybody that is related, at extreme levels, the workforce is going to start to look, sound
and act alike; that can be a concern from a discriminatory standpoint. The City could end up
in a situation where supervisors might be supervising a relative of a friend or someone over
them, and might be less likely to discipline. There might be issues with performance
appraisals and making sure those employees are held accountable if the relative is working
in the department, that they are getting fair performance appraisals.
Ms. Weller noted from the employee perspective, the concern is that anything that happens
to the employee throughout their employment is going to be because of who they are related
to, not necessarily because of job performance or abilities. These policies are in place in
other organizations, they are managed well and there are no issues. The situation is what is
going to work best for the City; the policy in place now works, but that is not to say that another
policy wouldn’t work and staff couldn’t manage this well. Mr. Larking noted the safest option
is to stick with what the City has, but the City has an issue, they need to hire people, there are
openings, a lot of turnover and there is an opportunity to hire qualified people for positions
that need to be filled right now. For practical reasons, he would recommend loosening the
nepotism policy, allowing staff to put in place an Administrative Policy and Procedure that
would prevent the kinds of troubles that Ms. Weller mentioned earlier, and give staff a way to
respond to them so that it will not become a latter issue for the staff.
Mr. Saunders stated he read the policy, and he has some concerns about morale. While
talking to people around the State, the State Police are loosening some of their requirements
to get local police officers to take jobs with them. The City needs police officers, if Council
can do something to make that work, he is open to that idea. Mr. Buckner noted he is for the
policy change. Mr. Larking noted if the City implements this policy and it turns out not to be a
good idea or didn’t work, it can be changed. They would probably grandfather in anyone that
got in, that is always an option. Mr. Shanks noted his agreement with Mr. Larking, and stated
the City needs to take advantage of an opportunity to change the policy for the benefit of the
people; this is a good time.

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December 5, 2017

Mayor Gilstrap called for a straw poll to change the policy and Council agreed to change it.
Mr. Larking noted it has been practiced in the past where if the City is aware that a policy is
in the path of being changed, can staff go ahead and proceed with some hiring if there are
opportunities. Council did not have any objections.
Mayor Gilstrap noted Mr. Vogler requested to add an item to this evening’s agenda; Council
has no objection to adding an item.
Mr. Jones left the meeting at 9:00 p.m.
DISCUSSION OF GROCERY FUND.
Mr. Vogler stated he sent out an email to Council regarding legislation going to the General
Assembly in January that will support increased investment in the Virginia Grocery Investment
Fund which provides incentives for grocery stores to open in high poverty areas and also
places where there are “food deserts.” Martinsville has already passed a resolution in support
of it and other localities are going to also. It would be beneficial for several areas in Danville.
Assistant to the City Manager Amanda Paez explained she has printed out the Bill that was
pre-filed last week and did reach out to the Health Collaborative to get information regarding
food deserts and food access in Danville to help write the resolution. Ms. Paez questioned if
Council wants this for adoption at the next regular session or would Council like to review the
resolution during the work session on the 19th. Mr. Vogler proposed voting on it at the next
business meeting. Ms. Paez noted this is not time sensitive; Martinsville did not pass a
resolution, but added it to their legislative agenda, a bullet point to support the legislation.
Mr. Larking questioned if the City has done a legislative agenda and Ms. Paez noted this was
her tenth session, the City did one legislative agenda and that was prepared by the City
Attorney’s office. Mr. Vogler noted he thought it would be more impactful if the City has this
as a stand-alone as opposed to mixing it in with other legislation. Mr. Shanks questioned
exactly what would it do for Danville, and Mr. Vogler explained it is a fund that will be used as
an incentive for grocery stores to locate in designated areas that are deemed to be lacking,
high poverty areas that would not be high on the list for a grocery store. Ms. Paez noted the
fund will be administered through DHDC and will be providing incentives, technical assistance
and also working to identify community partners to create new innovative projects. Dr. Miller
noted Richmond did this in Church Hill in the east end; that was a food desert in a poverty
area.
After further discussion, Council agreed to put this on the December 19th business agenda.
Dr. Miller noted Council should think about having a legislative agenda, some points that
Council favors.
PROGRAM UPDATE
Mr. Larking stated the City will be having police chief candidates and assessors in town this
week, there are four very strong, diverse candidates. Mr. Larking noted they are working to
have an announcement by the end of the year and get them started first thing in the new year.
Mr. Larking noted he will call each Council Member, discuss the candidates and the reason
why he feels the top candidate is his choice.

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December 5, 2017

COMMUNICATIONS
Dr. Miller noted the Sports Tourism Committee will be meeting tomorrow at 2:00 p.m.
Mr. Vogler questioned when the Data Center will be discussed and Mr. Larking noted he will
ask Mr. Tucker about the status of that. Mr. Whitfield noted this would normally be part of the
annual budget, making it a separate division and then determine what tax they want to use.
In response to Mr. Vogler, Mr. Whitfield stated he doesn’t think Council has to wait until the
budget process, but he will look into that; he doesn’t know what rules there are about setting
taxes in the middle of the budget year.
MEETING ADJOURNED AT 9:27 P.M.
APPROVED:

ATTEST:

______________________________
MAYOR

______________________
CITY CLERK

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CL-1820
Work Session Meeting

Work Session

Item #: A.

Meeting Date: 01/02/2018
Subject:
From:

Consideration of Appointments to Boards and Commissions
Susan M. DeMasi, Clerk of Council

COUNCIL ACTION
Work Session: 1/02/2018
SUMMARY
Consideration of Appointments to the following Board:
Council Letter Number CL - 1820.
1. Fair Housing Board
Attachments
No file(s) attached.

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