Loading...
HomeMy WebLinkAbout01/10/1991 FC minutesFINANCE COMMISSION Minutes of the Meeting January 10, 1991 I Call to Order The meeting was called to order at 7:30 p.m. Commission members in attendance were Richard Bachhuber, Paul Davies, John Engel, Newt Hallman, Vince Grochocinski, Jim Morrison, Tom Pekras, Ann Smilanic and Earl Sutter. Also present were Finance Director David Jepson, Assistant Finance Director Carol Widmer, two Village residents and one member of the press. Chairman Richard Bachhuber introduced new Finance Commission member Earl Sutter. Mr. Sutter was appointed to fill the vacancy created by the resignation of John Mussar. IIADnroval of Minutes The minutes of the December 13, 1990 meeting were accepted as presented. III Review of Flood Control Financing Finance Director David Jepson reviewed the decision of the Village Board at the Committee of the Whole meeting of December 29 to fund approximately $14.4 million in Flood Control Projects. The decision was to fund the projects by enactment of a 1/4% sales tax. A 1/4% sales tax would bring in approximately $1,050,000 a year and would support the bonds needed to pay for the various flood control projects. The following projects were approved in concept: In Phase I, the Central/WaPella project has already been authorized for design. The Prospect Manor/North Main project and the backwater control system by the Des Plaines River were also approved in concept. In Phase II, the See-Gwun/Golf project, the Weller Creek projects totalling approximately $400,000 including the Main Street Bridge, the Emerson Street Bridge, the realignment of the Creek at Elmhurst and the erosion control behind Crumley Basin were included. Also approved in concept in Phase II was the Fairview Gardens project. In Phase III, the See-Gwun/Milburn project, the Hatlen Heights project, the Clearwater flooding project and the Stevenson/Thayer project were approved in concept. In Phase IV, the Catalpa/Birch project was approved in concept. Members of the Finance Commission expressed concern that the projects will still not stop flooding in the Village and that businesses who contribute to the problem will not pay to alleviate the problem if a sales tax is used instead of a user charge. IV Ville Revenue Sources and Financing the 91/92 Budget David Jepson explained to the members of the Finance Commission that during the six month budget review each revenue and expenditure line item is reviewed and projections of revenues and expenditures for the balance of the current year and for the upcoming fiscal year are made based on current information on hand. The estimated 1990/91 budget amounts, as shown in the attached Schedule 2, General Fund Revenues and Expenditures 1982/83 - 1991/92, the excess of revenues over expenditures is projected to be $63,350. However, in the first draft of the 1991/92 budget, expenditures exceed revenues by $1,126,700. The Village has been attempting to keep the tax rate at approximately $1 per $100 of equalized assessed valuation with increases limited to 5% per year. In trying to relieve dependence on property taxes but keeping up with the need to fund expenditures such as the increasing costs of refuse disposal, a proposal was made to consider a refuse disposal user charge. This type of revenue could be collected along with the water bill. Finance Commission members expressed concern over the magnitude of increasing expenditures and the fact that personal services represent 75% of general fund expenditures. Paul Davies suggested that requests for additional personnel be scrutinized very closely. He stated that residents do not want to pay more property tax. Newt Hallman stated that in his opinion residents would rather pay for services in property taxes rather than additional fees. In response to Tom Pekras' question as to why expenditures have increased at a 9% annual rate, David Jepson cited increases in street, sewer and sidewalk programs and the fact that medical costs have increased from $1,200 per employee in 1985 to $3,750 in 1991 as examples of increased expenditures. The Finance Commission asked why the charge for yard bags, a revenue source in the 1990/91 budget, was not included in the 1991/92 budget. The Committee felt the per bag charge helped control the amount of waste and therefore accomplished the goal of the recycling. David Jepson explained that one of the revenue sources the Village Board is considering is a refuse disposal user charge. He then reviewed the schedule, Comparison of Refuse Disposal Fees and Property Taxes. This schedule shows a yearly cost of $48 for a single-family home and $24 for an apartment unit if the refuse disposal user fee is $4/mo and $2/mo, respectively. The revenue generated is then compared to the amount of property taxes if the refuse disposal charge is included in the property tax. Under the property tax assumption, an average single-family residence would pay $29 per year and an apartment unit would pay $23 per year. Commercial property would also be paying part of the cost even though they do not realize any benefit. The Commissioners discussed a user fee for refuse disposal and then made two recommendations. Jim Morrison proposed that the practice of charging for yard waste in a biodegradable bag be retained in the budget. The proposal passed by a unanimous vote. After additional discussion, another motion was put forth by Newt Hallman which stated that a Refuse Disposal User Charge should not be instituted. The Finance Commission suggests that the Village find another source of revenue other than a refuse disposal user charge if additional revenue is needed. The motion was passed by a vote of eight yeas - Ann Smilanic, Vince Grochocinski, Tom Pekras, Paul Davies, Earl Sutter, John Engel, Newt Hallman and Dick Bachhuber and one no vote by Jim Morrison. FO There was general consensus among the members of the Finance Commission that if additional revenues are needed for the 1991/92 budget property taxes are the most appropriate means to generate the necessary revenue. David Jepson stated that the 1991/92 proposed budgets will be distributed on February 1. The next Finance Commission meeting will be on February 7. V Adjournment was at 10:23 p.m. CLW/sm Enc 3 Respectfully submitted, Carol L. Widmer Assistant Finance Director VILLAGE OF MOUNT PROSPECT Comparison of Refuse Disposal Fees and Property Taxes Assumptions Number of Monthly Units Rate Single -Family Homes 13,400 x $4.00 Apartment Units 8,400 x 2.00 = Total Village tax rate to produce $844,800 = Sample Properties Single -Family Residential Apartment Unit 500 West Central Randhurst Ten Largest Taxpayers Comparison of Annual Charges Single -Family Residential Apartment Unit 500 West Central Randhurst Ten Largest Taxpayers Refuse Disposal Fee $48 $24 Annual Revenue $643,200 201.600 1$844,800 1 EAV $25,000 $20,300 $662,800 $57,892,500 $159,423,500 Property Tax $29 $23 $762 $66,576 $183,337