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HomeMy WebLinkAbout09/24/1992 FC agendaFINANCE COMNIISSION Minutes of the Meeting September 24, 1992 Call to Order The meeting was called to order at 7:40 p.m. Present were Chairman Richard Bachhuber; Commissioners John Engel, Vince Grochocinski, Newt Hallman, James Morrison, Ann Smilanic, and Earl Sutter. Also present were Finance Director David Jepson and Assistant Finance Director Carol Widmer. Commissioners Tom Pekras and Paul Davies were absent. H Annroval of Minutes The minutes of the August 27, 1992 meeting were accepted as written. III Review of 1992 Financial R=rt David Jepson presented the Village of Mount Prospect's Comprehensive Annual Financial Report for the Year Ended April 30, 1992. The report is designed to satisfy unique legal requirements as well as accounting requirements and is distributed to Bond Rating Agencies, the Illinois Department of Insurance, the State Comptroller, citizens and other local governments. The financial report consists of three sections: the first section is the Introductory Section which includes principal officials, an organization chart and a letter of transmittal; the second section is the Financial Section and includes the Independent Auditor's Report, General Purpose Financial Statements, Notes to the Financial Statements, and Combining, Individual Fund and Account Group Statements and Schedule; and Supplemental Data; and the Statistical Section is the third section of the report. The Letter of Transmittal which begins on page iv serves multiple purposes. Basically the letter summarizes the operations of the Village for the past year as well as a view of the economic outlook. The letter provides additional information to give an individual an introduction to the Village of Mount Prospect. The accounts of the Village are organized on the basis of funds and account groups, each of which is considered a separate accounting entity. The Village's accounting records for general governmental operations are maintained on a modified accrual basis, with revenues being recorded when available and measurable and expenditures being recorded when the services or goods are received and the liabilities are incurred. Accounting records for the Village's enterprise funds, internal service funds and pension trust funds are maintained on the accrual basis. Revenues and other financing sources (as shown on page vi) for general governmental functions totaled $24,543,415 for the fiscal year ended April 30, 1992 or 2.4% higher than 1991. Expenditures as shown on page vii totaled $24,233,849, up 3% over 1991. The Village ended 1992 with an unreserved -undesignated General Fund balance of $3,156,752 which represents 20% of General Fund expenditures. The goal has been to have a fund balance in the General Fund of 15% of expenditures. On page viii of the transmittal letter is basic information on property tax levies. When the Library's rate is subtracted, the Village's rate for 1991 is $0.927 which meets the self-imposed limit of $1.00 set by the Village Board. Property taxes provide the largest single source of revenue for financing Village services. Information on the Enterprise Funds is found on page x of the transmittal letter. The Water and Sewer Fund recorded net income of $89,753 for the fiscal year and ended the year with unrestricted cash and investments totaling $3,166,709. A rate study prepared in September 1990 indicated that rates will need to be increased approximately 5% per year to provide adequate operating revenues. In his discussion of the Village's economic outlook, Mr. Jepson pointed out that while Mount Prospect has experienced the effects of the slowdown of the economy in general, we have fared better than many other communities. Total sales tax receipts in the fiscal year ending April 30, 1992 were $5,746,281 compared to $5,770,367 for the previous year, a decrease of less than 1 %. Also, Mount Prospect's unemployment rate of 4.9 % is 3.5 % lower than the state average. Mount Prospect is located on the eastern edge of the "Golden Corridor" which has been one of the fastest growing areas in the entire Midwest. Economic development is expected to continue at a strong pace as evidenced by the relocation of the Sears merchandising group to this area. In the past few years the Village has undertaken a number of initiatives to improve Village services .4ncluding the Police Department achieving accreditation and a Class II fire rating for the Fire Department and Public Works Department. Another major initiative is in the area of recycling and refuse disposal. In 1991 the Village's recycling program was extended to include 7,500 multi- family residences in the Village and expanded to add plastics, metal containers and mixed papers. When the total amount of refuse landfilled in 1991 is compared to the volume in 1988, the Village has achieved a reduction in the waste stream of 38.5%. The Combined Balance Sheet on page 3 of the report shows the Village had total assets of $129,012,667 as of April 30, 1992. This Balance Sheet gives an overview of Village financial statements and is made up of 3 fund types and one account group. The Fund Types are made up of. 1) Governmental Funds which account for most governmental operations and include the General Fund, special revenue funds, debt service funds, and capital projects funds; 2) Proprietary Funds which include the Water and Parking Funds which are accounted for as enterprise funds and the Village's Risk Management and Vehicle Replacement Funds which are accounted for as internal service funds. The third fund type consists of pension trust and expendable trust funds. The Account Groups consist of general fixed assets and general long term debt. The library is included in the Village's report because the Village levies taxes for the library and is accounted for as a special revenue fund. 2 The Statistical Section, which along with the Introductory Section is not subject to review by the independent auditors, has a wealth of historical data available. This section which begins on page 160 of the Report includes a 10 year history of General Governmental Revenues and Expenditures, property tax assessed values, rates and Extensions, Tax Rates for all taxing bodies in Mount Prospect, demographic and miscellaneous statistics. Information on employee pensions is found on page xi and the summary information for the Police and Fire Pension funds shows that full funding has been achieved in each fund, specifically, 116.4% has been achieved in the Police Pension Fund and 115.3% in the Fire Pension Fund. It is the Village's intention to continue to maintain full -funding for these funds based upon actuarial requirements. The members of the Finance Commission commented on the readability and understandability of the report. They stated that the amount of information available was impressive and they thought the report was a valuable document. They expressed their appreciation to Dave for a job well done. IV Adjournment The meeting was adjourned at 10:25 p.m. The next meeting will be held on Thursday, October 29, 1992. CLW/sm 3 Respectfully Submitted, Carol L. Widmer, Assistant Finance Director