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Home My WebLink AboutCOW 2013-07-22 Item 4F - Discussion - Alliance One Lease Agreement COUNCIL AGENDA SYNOPSIS J��NALA ti, Initials ITEM No.liti A . Meeting Date Prepared by Mal's rivi Council review y 07/22/13 CT �� 2� 4F 2908 ITEM INFORMATION STAFF SPONSOR: DAVID CLINE ORIGINAL AGENDA DATE: 7/22/13 AGENDA ITEM TITLE Alliance One Lease Agreement CATEGORY ® Discussion ❑Motion ❑ Resolution ❑ Ordinance ❑ Bid Award ❑ Public Hearing ❑ Other Mtg Date 7/22/13 Mtg Date Mtg Date Mtg Date Mtg Date Mtg Date Mtg Date SPONSOR ❑ Council ®Mayor ❑ HR ❑ DCD ❑ Finance ❑ Fire ❑ IT ❑ P&R ❑ Police ❑ PWI SPONSOR'S Information is attached for City Council review to determine the future status of the SUMMARY Alliance One Lease Agreement. The City has had annual lease agreements with Alliance One since 2009. On 1/23/13 the Finance and Safety Committee recommended that a 6- month lease be approved through 6/30/13, which was approved by the full Council at the 2/4/13 Regular Meeting. The Council is being asked to provide direction on continuation of the lease. REVIEWED BY ❑ COW Mtg. ❑ CA&P Cmte ® F&S Cmte ❑Transportation Cmte ❑ Utilities Cmte ❑Arts Comm. ❑ Parks Comm. ❑ Planning Comm. DAZE: COMMITTEE CHAIR: RECOMMENDATIONS: SPONSOR/ADMIN. Mayor's Office COMMITTEE COST IMPACT / FUND SOURCE EXPENDITURE REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED $ Fund Source: Comments: MTG. DATE RECORD OF COUNCIL ACTION 7/22/13 MTG. DATE ATTACHMENTS 7/22/13 Informational Memorandum from David Cline dated 07/16/13 Informational Memorandum from Judge Walden dated 07/16/13 Minutes from the Finance and Safety Committee meeting of 1/23/12 101 102 ��J ILA !y '`J ass 2 City of Tukwila o `*0144, Jim Haggerton, Mayor 1908 INFORMATIONAL MEMORANDUM TO: Mayor Haggerton • CITY COUNCIL FROM: David Cline, City Administrato � '�' DATE: July 16, 2013 SUBJECT: Alliance One Lease Agreement ISSUE At the request of the Finance & Safety Committee, this memorandum provides information for use by the City Council to make an informative decision regarding the Alliance One lease agreement. BACKGROUND • Alliance One is the company Tukwila Municipal Court contracts with to provide collection services for unpaid court fines and fees. This company also manages long-term payment plans for our customers not in collections (Signal Credit). In May 2009, Alliance One began leasing space with the City of Tukwila. DISCUSSION It is the position of the administration that at the time the original lease was executed the City believed it was worthwhile to provide this space to Alliance One while monitoring the advantages and impacts this situation would create for the City and residents utilizing City Hall. Since that time Alliance One has now opened additional offices in Seattle and Kent, and also offers to accept payments over the phone or online, which provide alternate payment options for Tukwila Municipal Court customers. While both the Seattle and Kent pay stations are located at their Municipal Courts, both of the Seattle and Kent Municipal Courts are not located at City Hall. Having Alliance One located in Tukwila City Hall has increased the volume of traffic and vehicles at City Hall. A small percentage of Alliance One customers are Tukwila residents. Approximately 10,000 people per year, or an average of 40 additional visitors a day, visit the Alliance One pay station in Tukwila. This creates challenges for residents who need to utilize City Hall for a wide range of services (payment of utility bills, pet licenses, business license renewals, etc.). The main City Hall lobby has a large volume of Alliance One customers, waiting in a queue. The tenant has taken steps to improve the flow of foot traffic and reduce noise and disruptions but the City believes the negative impacts and image this activity creates does not offset the rent and other benefits. Administration would recommend that the lease agreement with Alliance One be terminated effective December 31, 2013. FINANCIAL IMPACT Alliance One currently pays the City of Tukwila $750.00 a month to lease space in the court area. RECOMMENDATION Staff recommends that the City Council provide direction to the administration on the termination or renewal of the Alliance One Lease Agreement. 103 1'04 ,� qs J ; sz City of Tukwila Jim Haggerton, Mayor 190a INFORMATIONAL MEMORANDUM TO: Mayor Haggerton CITY COUNCIL FROM: Kimberly A. Walden, Presiding Judge Tukwila Municipal Court BY: LaTricia Kinlow, Court Administrator DATE: July 16, 2013 SUBJECT: AllianceOne Pay Station ISSUE At the request of the Finance & Safety Committee, this memorandum provides information for use by the City Council to make an informed decision regarding the AllianceOne rental agreement. BACKGROUND AllianceOne is the company with whom Tukwila Municipal Court contracts collection services for unpaid court fines and fees. This company also manages long-term payment plans for our customers who are not in collections (Signal Credit). In May 2009, AllianceOne began leasing space with the City of Tukwila. This lease agreement was encouraged by the court in order to better support county and state-wide re-licensing efforts. More importantly, the AllianceOne window provides opportunities for our court customers to remain in compliance with court ordered payments of fines and fees. While there is a small percentage of AllianceOne customers with a Tukwila residential address, keep in mind, most court customers are NOT Tukwila residents. They are persons who violate traffic laws or commit crimes within Tukwila city limits. These are people who will continue to drive in and around Tukwila frequenting businesses, government services, and who may be employed in Tukwila. This makes it even more imperative that we help them stay in compliance and remain or become lawful drivers—validly licensed and insured. With over 300,000 unlawful drivers in our state and a high volume of motor vehicle traffic in our city, the court strongly believes that we owe it to our citizens to help alleviate the problem of uninsured/unlicensed drivers involved in motor vehicle accidents. On average, approximately 10,000 customers visit the Tukwila Pay Station every year. In 2012, 9,691 customers were served at the pay station resulting in $1,827,981.73 collected at the Tukwila location. Unfortunately, we are unable to confirm the amount of revenue received via AllianceOne/Signal Credit that is retained by the City. The payments received from the collection agency are processed in JIS (Judicial Information System), and we are unable to create a bifurcated report detailing from whom the money was received. The allocation of the funds are distributed between the executive branch, AOC, State, special funds, etc., just like any other payments received by the court. The information below reflects the total amount collected at the Pay Station in 2012 for accounts assigned by Tukwila: Total Collected for Tukwila Court in 2012 - $71,583.96 • $66,223.00 —AllianceOne • $5,360.96 - Signal In 2012 AllianceOne begin using a payment box for the convenience of those customers who make monthly payments. This allows the customer to come into the court lobby and place their payment in the payment box and eliminates the need for them to actually visit the window. Approximately 5 customers per day use the payment box. 105 INFORMATIONAL MEMO Page 2 Total collected at the Tukwila Pay Station 2010 $2,353,498.17 2011 $2,568,896.03 2012 $1,654,462.38 There is a decrease in the revenue amount due to the Kent Pay Station opening in 2012. This also resulted in a decline in the number of AllianceOne patrons visiting the City's facility. Funds collected at the Seattle and Kent Municipal Court locations are as follows: Total collected at the Kent Pay Station 2010 — Not open 2011 - $496,257.28 (Opened in April) 2012 - $1,983,440.79 Total collected at the Seattle Pay Station 2010 - $4,995,708.40 2011 - $4,298,172.07 2012 - $3,834,620.07 OTHER PERTINENT CUSTOMER INFORMATION In the 1st Quarter of 2013 More than 600 customers visited the court for non-court, non-collections related matters. The court team willingly provided the information the customer needed or directed them to the proper source. PERTINENT INFORMATION IN SUPPORT OF THE PAY STATION The court has a relicensing program where defendants appear before the court and make arrangements to pay their traffic fines. The Tukwila Municipal Court strives to provide resources to help customers comply with court orders. Having AllianceOne located in the same facility as the assists customers seeking to reinstate their driving privileges by providing them the convenience with a convenient place to pay their fine, thereby ensuring access to justice. The court met with the Prosecutor and the Public Defense Team and they support keeping the pay station at the Tukwila Municipal Court. FINANCIAL IMPACT AllianceOne currently pays the City of Tukwila $750.00 a month to lease space in the court area. While the court receives no direct financial benefit from the lease agreement, the court customers and court stakeholders receive a great benefit from having the AllianceOne pay station here at the Tukwila Municipal Court. RECOMMENDATION In keeping with the city's mission, "To provide superior services that support a safe, inviting and healthy environment for our residents, businesses and guests,"it is the court's recommendation that the city supports the court's efforts of providing superior services to our customers by signing the lease agreement with AllianceOne through the December 31, 2016. This date correlates with the lease agreement the city currently holds with the Sound Cities Association for their office space in the 6300 Building. ATTACHMENTS Letter from Seattle Municipal Court C:14ients and Settingslchristy.TUKWILA\Local SettingslTemporary Internet Files\Content.Outlook\FOTTAFSU\Memo to Mayor Haggerton(AllianceOne Pay Station).doc THE MUNICIPAL COURT OF SEATTLE 1C^SdIt;CTOki February 13, 2013 To: Honorable Kimberly A. Walden Latricia Kinlow, Court Administrator) ,Fr: Kimi Kondo,Presiding Judge t L^ Yolande E. Williams, Court Administrator Re: AllianceOne Lease We understand that you are reviewing your agreement to lease space in your court to AllianceOne Receivables. Seattle Municipal Court's contract with AllianceOne requires them to operate at least one south King County payment location. This arrangement gives citizens of other cities a more convenient place to pay their debts to other courts as well as ours, and we believe it • demonstrates the spirit with which our courts have collaborated over the years to serve citizens navigating their way through the courts. As you probably know, AllianceOne leases two front counter spaces in our court's lobby. Last year,the Seattle location accepted over$27,000 in fines and obligations on behalf of your court. Also, according to AllianceOne, their Tukwila Muni Court pay station • collected over$140,000 in Seattle Muni Court obligations,which constituted about nine percent of the revenue collected there. Since many of those who have accounts in collections have limited means, having geographically diverse payment options helps to minimize the distance they must travel to pay in person and it also encourages payment. Seattle's contract with AllianceOne expires March 31,2014. We hope that you will decide to continue leasing space in your court to AllianceOne in the spirit of court collaboration and a commitment to improve access to justice. Municipal Court of Seattle,PO Box 34987,Seattle,WA 981244987 www.seattle.gov/courts TN(Healing t&Speech Impaired)6848210 . 107 108 ��wI1LA�:yqs`\ /o,i y , City of Tukwila ,o) Finance and Safety Committee �•..190a FINANCE AND SAFETY COMMITTEE Meeting Minutes January 23, 2013—5:15p.m.; Conference Room #3 ** Wednesday meeting due to holiday PRESENT Councilmembers: Dennis Robertson,Chair, Chair;Verna Seal and De'Sean Quinn Staff: Mike Villa,Mary Miotke,Joyce Trantina,Peggy McCarthy,Vicky Carlsen,Richard Takechi, Kim Walden,Trish Kinlow,David Cline and Kimberly Matej CALL TO ORDER: Committee Chair Robertson called the meeting to order at 5:36 p.m. I. PRESENTATIONS No presentations. II. BUSINESS AGENDA A. Contract: Strategic Plan Implementation—BERK Consulting Staff is seeking Council approval to enter into a contract with BERK & Associates in an amount not to exceed $65,000 to assist in the implementation of the City's 2012 Strategic Plan. The following outcomes are included in the proposed scope of work and are considered deliverables: • Conceptual phasing of Strategic Plan elements • Alignment of department work plans with the City's budget and Strategic Plan • Production of frameworks that illustrate alignment and clarify roles about relationships between people,processes and products • Performance measures for communicating and tracking processes • Provide communication strategies In summary, this contract will provide assistance to the City that guides and manages the ongoing Strategic Plan process. UNANIMOUS APPROVAL. FORWARD TO JANUARY 28 COW FOR DISCUSSION. B. Lease Agreement: Alliance One Staff is seeking Council approval to enter into 6-month lease agreement with Alliance One Receivables Management for front counter workspace located within the Tukwila Municipal Court at City Hall. The lease rate is $750 per month. Alliance One is an accounts receivable management service for revenue recovery which began leasing space in the Court in 2009. The current lease expired on December 31, 2012, and staff is proposing a six- month lease retroactive to January 1,2013 through June 30,2013. The six-month lease proposal has been made so that the advantages and disadvantages of continuing to have this service located in City Hall can be assessed. After discussion regarding specific advantages and disadvantages, the Committee requested that staff return to a Committee of the Whole meeting towards the end of first quarter or beginning of second quarter to present their findings to the full Council. For now, the Committee recommends processing the six-month lease. UNANIMOUS APPROVAL. FORWARD TO FEBRUARY 4 CONSENT AGENDA. C. Ordinance: Leak Adjustment Policy Staff is seeking Council approval to repeal two ordinances regarding water and sewer bill leak adjustments. 109