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HomeMy WebLinkAbout5. New Business 10/02/2012Village of Mount Prospect Mount Prospect, Illinois INTEROFFICE MEMORANDUM TO: MICHAEL E. JANONIS, VILLAGE MANAGER FROM: FINANCE DIRECTOR DATE: SEPTEMBER 19, 2012 SUBJECT: AMENDMENTS TO CHAPTER 9 AND 19, AND APPENDIX OF THE VILLAGE CODE FOR WATER AND SOLID WASTE COLLECTION PURPOSE: To present for the Board's consideration an ordinance amending Chapters 9 and 19, and Appendix A of the Village Code. BACKGROUND: The Village Code for water and solid waste collection was last amended in November 2007. At that time revisions were made to chapters 9 and 19 to account for the implementation of single family refuse billing and the use of toters in solid waste collection of residences. Revisions were also made to the charge related to managing delinquent accounts. New utility billing software will allow changes to billing frequency and other aspects of utility billing to gain operational efficiencies. Due to these operational changes, modifications are needed in the Village Code. DISCUSSION: The Village is scheduled to go live with its new utility billing software in October 2012. Utility billing is the final major module of the village -wide ERP system to be implemented. Proposed changes include modifications to billing frequency, delinquency process, late fees and payments processing. Detail of these proposed changes is provided below. Billing frequency - the new utility billing software will allow Finance staff to more fully automate the billing process and eliminate some of the manual labor intensive processes. The Village currently bills all customers on a bi- monthly basis. Approximately one - quarter of customers are billed on the 15 and 30 of every month. The new billing system will allow all customers to be billed on the 15 of each month. This change improves efficiencies by eliminating one billing process per month. Cash flow will also improve with more frequent billing. Village Code Amendment — Chapters 9 and 19, Appendix A September 19, 2012 Page 2 Delinquency process - the period of time an account is allowed to remain delinquent before commencing shut -off procedures will be reduced from ninety (90) to sixty (60) days. The shorter period takes into account the change from bi- monthly to monthly billing periods. The change will allow one or more of the notices currently being sent by the Village to delinquent accounts to be eliminated. The proposed changes will work to streamline the overall delinquency and related "Red Tag" process. Late fees — late fees on solid waste collection are not consistent between single family and multi - family units. Currently, single family units are assessed a 10% late fee for delinquent payments while multi - family units are assessed at a rate of 20 %. The proposed change reduces the multi - family rate to 10 %. Payment processing — there is an early payment discount of 1% for multi - family refuse accounts. This discount is not offered to single or multi - family water accounts or single family refuse accounts. It is our recommendation to eliminate the early payment discount to remove the disparity between the account holders. RECOMMENDATION: It is recommended the Village Board approve the attached ordinance amending Chapters 9 and 19 and Appendix A of the Village Code. David O. Erb Finance Director I: \Water & Sewer \Chapter 9 and 19 Code Amendments Memo.docx ORDINANCE NO. AN ORDINANCE AMENDING CHAPTERS 9 AND 19, AND APPENDIX A OF THE VILLAGE CODE OF MOUNT PROSPECT BE IT ORDAINED BY THE PRESIDENT AND BOARD OF TRUSTEES OF THE VILLAGE OF MOUNT PROSPECT, COOK COUNTY, ILLINOIS ACTING IN THE EXERCISE OF THEIR HOME RULE POWERS: SECTION ONE Subsection A(2) of Section 9.409, "Water Meters ", of Article IV, "Water Supply System ", of Chapter 9 of the Code of Ordinances of the Village of Mount Prospect, Illinois, as amended, shall be deleted in its entirety and a new Subsection A(2) inserted, to be and read as follows: 2. Water bills shall include a notice that a monthly water meter reading is required. In the event that a water meter reading is not received by the village's finance department at least five (5) days prior to the mailing date of a water bill, the director of finance shall establish an estimated meter reading to be used for billing purposes based upon a like period during the preceding year or in such manner as the director may determine. In the event that a meter reading is estimated for six (6) consecutive billing periods, the consumer shall be given at least ten (10) days written notice of intent to shut off the water service, the reason for the shutoff, and an opportunity to provide a water meter reading or request a hearing within the ten (10) day period with respect to such meter reading before the village manager or finance director. If the village manager or finance director confirms the shutoff, the consumer shall be allowed a reasonable period of time, not less than five (5) days, to provide the water meter reading prior to the shut off of service. Prior to shutting off the service, a red tag notice shall be posted at the premises warning that the service will be shutoff. An administrative fee, as set forth in Appendix A, Division II, will be assessed upon the sending of the ten (10) day notice to compensate the Village for its administrative expenses, whether or not the service is actually shut off. Water service, which has been shut off, shall not be resumed until the water meter reading is received 293620_2 SECTION TWO Section 9.412, "Delinquent and Unpaid Accounts ", of Article IV, entitled "Water Supply System ", of Chapter 9 of the Code of Ordinances of the Village of Mount Prospect, Illinois, shall be amended, as follows: 1. Subsection B shall be deleted in its entirety and a new Subsection B inserted, to be and read as follows: B. Water Service Shutoff: Whenever charges for water service have remained unpaid for more than sixty (60) days after the date of the statement for such services, the water service may be shut off to the premises of such delinquent consumer. The consumer shall be given at least ten (10) days written notice of intent to shut off such service, the reason for the shutoff, and an opportunity to request and obtain a hearing with respect to such unpaid charges before the village manager or finance director. If the village manager or finance director confirms the shutoff, the consumer shall be allowed a reasonable period of time, not less than five (5) days, to pay the delinquent charges prior to the shut off of services. Prior to shutting off the service, a red tag notice shall be posted at the premises warning that the service will be shutoff. An administrative fee, as set forth in Appendix A, Division II, will be assessed upon posting of the red tag notice to compensate the Village for its collection expenses, whether or not the service is actually shut off. Water service, which has been shut off, shall not be resumed until all bills, late charges and penalties have been paid, including the administrative fee. It shall be the duty of the director of finance to enforce the provisions of this section whenever delinquency shall occur. 2. Subsection C(1) shall be amended to delete the phrase "ninety (90) days" and replace it with the phrase "sixty (60) days" as it appears in the first and second to last sentences SECTION THREE Section 9.411, "Billing ", of Article IV, entitled "Water Supply System ", of Chapter 9 of the Code of Ordinances of the Village of Mount Prospect, Illinois, as amended, shall be amended by deleting the term "bimonthly" in the first sentence of the first paragraph and replacing it with the term "monthly ", that sentence to be and read as follows (and the rest of the Section to remain): 2936202 2 Billings for water provided under this Article shall be compiled and processed monthly or as the director of finance shall determine. SECTION FOUR: Section 19.202, "Regulations With Respect to Customers of a Solid Waste Collection Service ", of Article II, entitled "Solid Waste Collection" of Chapter 19 of the Code of Ordinances of the Village of Mount Prospect, Illinois, as amended, is amended as follows: 1. The words "customer" or "customers" in the title and throughout Section 19.202 shall be replaced with the words "consumer" or "consumers ", as applicable. 2. Subsection A. 12.b(2), describing a discount for multi - family customers, is deleted in its entirety and the remaining subsections renumbered numerically. 3. Subsection A.12.d(1) is deleted in its entirety and a new Subsection A.12.d(1) inserted in its place, to be and read as follows: (1) Whenever charges for solid waste collection services have remained unpaid for more than sixty (60) days after the date of the statement for such services, the solid waste collection service may be cancelled for the premises of such delinquent consumer. The consumer shall be given at least ten (10) days' written notice of intent to cancel such service, the reason for the cancellation, and an opportunity to request and obtain a hearing within the ten (10) day period with respect to such unpaid charges, before the village manager or finance director. If the village manager or finance director confirms the cancellation order, the consumer shall be allowed an additional five (5) days, to pay the delinquent charges prior to the cancellation of service. Prior to cancelling the service, a red tag notice shall be posted at the premises warning that the service will be cancelled. An administrative fee, as set forth in Appendix A, Division II, will be assessed upon posting of the red tag notice to compensate the Village for its collection expenses, whether or not the service is actually cancelled. Solid waste collection service, which has been cancelled, shall not be resumed until all bills, late charges and penalties have been paid, including the administrative fee. It shall be the duty of the director of finance to enforce the provisions of this section whenever delinquency shall occur. SECTION FIVE Section 9.409, "Water Meters ", of Chapter 9, "Public Utilities, Pavement and Tree Regulations ", of Appendix A, Division II, "Fees, Rates and Taxes ", 293620_2 3 of the Code of Ordinances of the Village of Mount Prospect, Illinois, as amended, shall be amended by deleting subsection A.2 and inserting a new subsection A.2, to be and read as follows: A.2. Administrative fee: $100.00. SECTION SIX Section 9.412, "Delinquent and Unpaid Accounts ", of Chapter 9, "Public Utilities, Pavement and Tree Regulations ", of Appendix A, Division II, "Fees, Rates and Taxes ", of the Code of Ordinances of the Village of Mount Prospect, Illinois, as amended, shall be amended by deleting Subsection B in its entirety and inserting a new Subsection B, to be and read as follows: B. Administrative fee: $100.00 SECTION SEVEN Section 19.202, "Regulations with Respect to Customers of Solid Waste Collection Services ", of Chapter 19, "Health Regulations ", Appendix A, Division II, "Fees, Rates and Taxes ", of the Code of Ordinances of the Village of Mount Prospect, Illinois, as amended, shall be amended, as follows: 1. The term "Customers" in the title to Section 19.202 shall be replaced with the term "Consumers ". 2. Section 12.b.(3) shall be deleted in its entirety and a new Section 12.b.(2) inserted, to be and read as follows: 12.b.(2) Late fee of 10% of bill if not paid by due date. 3. Section A.12.d.(1) shall be deleted in its entirety and a new Subsection A.12.d inserted to be and read as follows: 12.d. (1) Administrative Fee: $100.00; SECTION EIGHT This Ordinance shall be in full force and effect from and after its passage, approval and publication in pamphlet form in the manner provided by law. 293620_2 4 AYES: NAYS: ABSENT: PASSED and APPROVED this day of , 2012. Irvana K. Wilks Village President ATTEST: M. Lisa Angell Village Clerk 293620_2 Village of Mount Prospect Mount Prospect, Illinois INTEROFFICE MEMORANDUM TO: MICHAEL E. JANONIS, VILLAGE MANAGER FROM: FINANCE DIRECTOR DATE: SEPTEMBER 19, 2012 SUBJECT: AMENDMENT TO CHAPTER 5 OF THE VILLAGE CODE — AUDIT COMMITTEE PURPOSE: To present for the Board's consideration an ordinance amending Chapter 5 of the Village Code. BACKGROUND: Ordinance 5510, approved September 6, 2005 established an audit committee of the Village of Mount Prospect. The purpose of the audit committee is to further enhance the independence of the auditor by providing a direct link between the auditor, the corporate authorities and village management. The committee is advisory in nature and intended to assist the corporate authorities in obtaining and monitoring the village's annual audit to ensure a fair and accurate presentation of the village's financial statements. DISCUSSION: Several revisions to Chapter 5 of the village code are being recommended with respect to the governance and administration of the audit committee. Material changes appear in the committee purpose and committee membership sections of the code along with the process for selecting the committee chair. Revisions made to Section 17.101, creation and purpose, are intended to illustrate the oversight nature of the committee. One central purpose of the committee will be to focus on assessing compliance with existing policies and procedures and the adequacy of internal controls. The makeup of the committee listed in Section 17.102, membership, has been revised to reflect the Finance Director becoming an ex- officio member to be replaced on the committee by a second member of the board of trustees. Also changed in this section is the process for selecting committee chair. The chair will now be selected by all members of the committee where previously the committee chair was identified in code to be the village president. Other minor changes were made to Chapter 5, Section 17 for a more consistent read with other sections of the code dealing with boards and commissions. I:\Audit\Audit Committee \2012 \Village Code Amendment - Audit Committee.docx Village Code Amendment — Chapter 5 September 19, 2012 Page 2 RECOMMENDATION: It is recommended the Village Board approve the attached ordinance amending Chapter 5 of the Village Code. David O. Erb Finance Director I:\Audit\Audit Committee \2012 \Village Code Amendment - Audit Committee.docx ORDINANCE NO AN ORDINANCE AMENDING CHAPTER 5 OF THE VILLAGE CODE OF THE VILLAGE OF MOUNT PROSPECT REGARDING THE AUDIT COMMITTEE BE IT ORDAINED BY THE PRESIDENT AND BOARD OF TRUSTEES OF THE VILLAGE OF MOUNT PROSPECT, COOK COUNTY, ILLINOIS, ACTING IN THE EXERCISE OF THEIR HOME RULE POWERS: SECTION 1 : Article XVII, entitled "Audit Committee," of Chapter 5, Boards and Commissions, of the Village Code of the Village of Mount Prospect is deleted in its entirety and a new Article XVII, "Audit Committee," inserted, to be and read as follows: Article XVII, AUDIT COMMITTEE 5.1701. CREATION AND PURPOSE: There is hereby established an audit committee of the village of mount prospect. The purpose of the audit committee is to further enhance an auditor's independence by providing a link between the auditor and the village president and board of trustees. The committee is advisory in nature and assists management and the village president and board of trustees to ensure a fair and accurate presentation of the village's financial statements. The Committee shall also be responsible for audit selection, oversight of the annual audit and oversight of internal controls. 5.1702. MEMBERSHIP: A. There shall be 5 voting members of the audit committee. All members shall be residents of the village, except the director of finance, who shall serve as an ex- officio member. The voting members, who shall be appointed by the village president Nvith the advice and consent of the board of trustees, shall consist of the folloNving: 1. Two (2) members of the board of trustees; 2. One (1) member of the finance commission; and 3. Two (2) residents -at- large. B. Every two years at the first meeting of the calendar year, a chair shall be elected by the members of the committee. The chair shall serve no more than two consecutive terms as chair. C. Each member of this committee shall serve for a term of four (4) years, or until a successor is appointed and qualified. Terms may be adjusted by the village president and board of trustees to assure no more than 3 terms end in any particular year. In the event that a member of the audit committee is an elected official who fails to retain a seat on the Board of Trustees, the committee position shall be vacated and another member of the board of trustees shall be appointed to serve any remaining portion of the term. 5.1703. ORGANIZATION: A. Immediately upon its organization, the audit committee shall select from its membership a vice chair and a secretary. The persons so selected shall serve for terms of two (2) years, and may be reselected to the same position. 293609_1 B. The committee shall adopt rules for the conduct of its meetings and shall keep written minutes of all meetings and other procedures. Robert's Rules of Order shall govern the conduct of the meetings to the extent that parliamentary issues are not addressed by anv rules, Nvhich may be adopted by the committee. C. All meetings of the committee shall be public and its minutes shall be available for examination in the office of the village clerk during regular business hours. 5.1704. DUTIES AND RESPONSIBILITIES: In advising and assisting the village president and board of trustees, the audit committee shall have the folloNving duties: A. Selection of an independent auditor. Results of a competitive RFP process Nvill be brought to the audit committee for discussion and recommendation to the village president and board of trustees. B. Oversight of the village's fraud risk assessment program. Guidelines for monitoring compliance are included in the Statement of Auditing Standards No. 99 entitled — "Consideration of Fraud in a Financial Statement Audit ". C. Oversight of the annual audit to include 1) an update on pre -audit conference, 2) a status report on progress of annual audit, and 3) the results and findings of the final audit report. D. Present annually to the village president and board of trustees and management a written report on its activities in discharging its duties and responsibilities set forth in this Section. . 5.1705. MEETINGS: A. The audit committee shall meet at least twice a Near. Its meeting schedule Nvill correspond to Village staffs Nvork on the annual audit. Notices and the conduct of its meetings Nvill be in accordance Nvith the open meetings act. The chair may call for special meetings as needed. 293609_1 2 SECTION 2 : This Ordinance shall be in full force and effect from and after its passage, approval and publication in pamphlet form in the manner provided by law. AYES: NAYS: ABSENT: PASSED and APPROVED this day of 2012. Irvana K. Willcs, Village President ATTEST: Lisa Angell, Village Cleric 293609_1 Village of Mount Prospect Mount Prospect, Illinois INTEROFFICE MEMORANDUM TO: MICHAEL E. JANONIS, VILLAGE MANAGER FROM: FINANCE DIRECTOR DATE: SEPTEMBER 19, 2012 SUBJECT: COMPREHENSIVE ANNUAL FINANCIAL REPORT— DECEMBER 31, 2011 PURPOSE: To present the Comprehensive Annual Financial Report (CAFR) for the fiscal year ended December 31, 2011. BACKGROUND: Each year the Village retains a CPA firm to audit the Village's financials and assist in the preparation of the annual CAFR. Lauterbach & Amen performed the audit for the Village for fiscal year ended December 31, 2011. DISCUSSION: The CAFR presents two kinds of financial statements, each with a different snapshot of Village finances. The statements focus is on the Village as a whole (government -wide) and on the major individual funds. Both perspectives allow the user to address relevant questions, broaden a basis for comparison from year -to -year at the Village and also between governments and enhance the Village's accountability. Lauterbach & Amen has given its audit of the Village for year -end 2011 an "unqualified opinion ". This means that their examination found our financial statements to be fairly presented and prepared in accordance with generally accepted accounting principles. Their opinion can be found on pages 1 and 2 in the financial section of the report. A detailed overview of the financial results for the fiscal year is provided in the Management's Discussion and Analysis, which is found immediately following the auditor opinion on page 3 of the financial section. An electronic copy of the entire CAFR document is included with this memo. The following are a few of the more significant highlights for the General Fund, the village's main operating fund. General Fund revenues of $41,172,988 came in slightly higher than the final budget by $78,458 or 0.2 %. The following table shows the variance from final budget for revenues broken down by major revenue category. Comprehensive Annual Financial Report September 19, 2012 Page 2 Revenue Type Final Budget Actual $Variance %Variance Property Taxes $ 11,746,500 $ 11,750,523 $ 4,023 0.03% Other Taxes 6,861,000 7,163,253 302,253 4.41% Licenses, Permits and Fees 3,410,200 3,356,816 (53,384) (1.57 %) Intergovernmental 16,578,000 16,401,311 (176,689) (1.07 %) Charges for Service 1,628,690 1,694,563 65,873 4.049/. Fines and Forfeitures 555,500 548,993 (6,507) (1.17 %) Interest Earnings 23,600 23,067 (533) (2.26 %) Miscellaneous 291,040 234,462 (56, 578) (19.44 9/.) Total Revenue $ 41,094,530 $ 41,172,988 $ 78,458 0.19% Property tax revenues were up only slightly from the final budget by $4,023. The amount collected by the County and remitted to the Village came in at 98.5% of the original levy. This is slightly below the average collection ratio of 98.6% for the Village in the past ten years. Revenue classified as Other Taxes exceeded the final budget by $302,253, or 4.4 %. The surplus over budget can be attributed mostly to the telecommunication tax and food and beverage tax, which exceeded their budgets $225,668 and $67,630 respectively. The remaining revenues in this category had minor variances plus or minus budget. Intergovernmental revenues fell short $176,689 or 1.1% from the $16,578,000 final budget amount. The original budget was increased by $832,500 for adjustments to various revenue line items. Although receipts from sales taxes were down $35,399 from the final budget, when compared to the original budget they were up $385,601. The Village did receive a FEMA grant totaling $142,767, reimbursement for expenses incurred during the extreme snow event that occurred in February 2011. General Fund expenditures totaled $40,786,107, representing a positive variance of $1,189,871, or 2.8 %, under the final 2011 Budget. The following table presents a breakdown of actual expenditures as compared to the final budget for each department. Department Final Budget Actual $ Variance % Variance Public Representation $ 525,998 $ 454,868 $ (71,130) (13.52 %) Village Manager's Office 2,618,479.00 2,645,349.00 26,870 1.03% Television Services 170,979 149,956 (21,023) (12.30 %) Village Clerk 155,426 144,417 (11,009) (7.08 %) Finance 1,618,137 1,561,764 (56,373) (3.48 %) Community Development 2,252,212 2,109,428 (142,784) (6.34 %) Human Services 1,030,431 981,386 (49,045) (4.76 %) Police 14,840,002 14,657,035 (182,967) (1.23 %) Fire 11,554,618 11,448,614 (106,004) (0.92 %) Public Works 1 7,163,833 1 6,587,428 1 (576,405) (8.05 %) Pensions 45,863 1 45,862 1 (1) 1 (0.00 %) Total Expenditures $ 41,975,978 1 $ 40,786,107 1 $ (1,189,871) (2.83 %) The results from operations of the General Fund for 2011 showed a surplus. Revenues exceeded expenditures by $386,881. Fund balance as of December 31, 2011 was $10,804,868, representing 26.0% of budgeted operating expenditures for 2012. Comprehensive Annual Financial Report September 19, 2012 Page 3 In addition to performing the audit on the Village's financials, Lauterbach & Amen also conducted two separate audits referred to as the Single Audit and audit of the Downtown Redevelopment TIF. The Single Audit is a compliance audit of the Village's federal and state grant receipts pursuant to the U.S. Office of Management and Budget Circular A -133. The TIF Audit is also a compliance audit required by the State of Illinois covering our tax increment financing activities. Results from these two audits indicate the Village is in compliance with requirements outlined in the Single Audit Act and TIF Statutes. A final requirement of Lauterbach & Amen is to prepare various communications to the Village's governing board. The communications include the Management Letter, Representation Letter, SAS 114 — Auditor Findings, and SAS 115 — Internal Controls. The purpose of these communications is to inform the board of any problems encountered during the audit, and to report any potential fraud or deficiencies in internal controls uncovered during the course of the audit. No material weaknesses in any of the areas were found during the course of the audit. Electronic copies of these communications are also attached for your review. RECOMMENDATION: It is recommended the Village Board accept the Comprehensive Annual Financial Report and accompanying communications for the fiscal year ended December 31, 2011. David O. Erb Finance Director I: \Audit \Audit Committee \2011\Annual Audit Review - 12 -31 -11 CAFR.docx