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HomeMy WebLinkAbout04/26/2016 COW MinutesFINANCIAL PLANNING WORKSHOP MINUTES JOINT MEETING with VILLAGE BOARD and FINANCE COMMISSION April 26, 2016 CALL TO ORDER The meeting was called to order at 6:30 p.m. in the Village Board Room of the Village Hall, 50 South Emerson Street, by Mayor Arlene Juracek. II. ROLL CALL Trustees present included Paul Hoefert, John Matuszak, Steven Polit, Richard Rogers and Colleen Saccotelli. Finance Commission members included Commission Chair Vince Grochocinski, Trisha Chokski, John Kellerhals, Thomas Pekras and Mary Rath. Staff present included Village Manager Michael Cassady, Finance Director David Erb, Police Chief Timothy Janowick, Fire Chief Brian Lambel, Public Works Director Sean Dorsey, Community Development Director William Cooney, Human Services Director Julie Kane, Police Deputy Chief Michael Eterno, Fire Deputy Chief John Dolan, Public Works Deputy Director Jason Leib, Human Services Deputy Director Jan Abernethy and Administrative Analyst Alexander Bertolucci. III. CITIZENS TO BE HEARD None IV. FINANCIAL PLANNING WORKSHOP 1) 2015 Year -End Results Finance Director Erb stated there were three amendments made to the 2015 budget and the total budget increased from $116.0 million to $126.4 million. He stated these amendments relate to carry-over items primarily to capital programs and extraordinary items. He provided an overview of the telecommunication tax reset and how sales tax growth exceeded 3.0% projected for 2015. He also highlighted the unanticipated receipts from income and real estate transfer taxes. General discussion from the Village Board and Finance Commission included questions regarding the Village's reserve fund policy, the 20% to 30% range and the established 25% threshold. 2) 2016 First Quarter Review Finance Director Erb stated there was one amendment made to -date primarily to adjust for capital projects funded through the Capital Improvement, TIF, Street, Flood, Water/Sewer and Capital Funds for a total $3.9 million. Also, revenues were adjusted based on prior year actuals. He stated current estimates assume no loss of Local Government Distributive Fund (LGDF) revenue, potential property tax freeze, or other impacts due to state budget impasse/fiscal condition. He stated no changes were made to expenditures since there is insufficient history (3 months of data) to support any adjustments at this time. He stated the General Fund has experienced growth in reserve level as percent of expenditures and at 12/31/2016 would have a fund balance is $18.2 million or 35.5%. Committee of the Whole Page 1 of 3 04/26/16 General comments from the Village Board and Finance Commission included the following items: • There were questions regarding the Village's credit rating and if the Village can reach AAA+ status. There was discussion regarding the Village's reserve levels and the potential impact of the state's budget impasse, reduced LGDFs and property tax freeze legislation. There were questions regarding pre -funding SAFER grant hiring to prepare for when the grant funds expire. 3) 2016 Proposed Property Tax Levy Finance Director Erb stated the annual property tax levy is allocated to pay debt services, pensions and general operations. He stated the initial 2016 levy included in the 2017 Forecast Budget was $18.9 million, an increase of 3.27% ($598,825). Mr. Erb stated the Society of Actuaries published revised mortality tables that reflect longer life expectancies. The internal assumption previously used for year over year increase, based on the Annual Required Contribution (ARC), was 7.0% for each pension fund. The new actuary mortality tables increase the percentage to 19.1 % for police pension and 23.8% for fire pension. Mr. Erb provided several levy scenarios regarding how to phase-in these new pension increases. He stated projected future levies during the phase-in period to be between 4.0% and 4.5%. He also reviewed factors impacting out years of the levy that include legislative changes to pension plans, deviations from 7.0% assumed annual increase, and other unanticipated events. General comments from the Village Board and Finance Commission included the following items: • There was a general discussion regarding the adjusted actuary mortality tables and pension contributions. It was noted that it has been several years since the last update; however, the Society of Actuaries will be adjusting the mortality tables every two years moving forward. • There were comments regarding pension contributions and the percent which the pension funds are funded. 4) 2017 Revised Forecast Budget Finance Director Erb stated the overall growth in revenue is projected at 2.9% ($120.4 million), while total village budget for expenditures, excluding capital, increase 2.1% (112.8 million). He provided an overview of projected General Fund revenues and expenditures which increase 2.1% ($52.5 million) and 1.9% ($50.9 million) respectively. He stated the 2017 Forecasted Budget assumes no reduction in state collected revenues. General comments from the Village Board and Finance Commission included the following items: • It was noted the state had recently notified municipalities of a replacement tax miscalculation which is to be repaid to the state. The impact to the Village is about $55,000. 5) Preliminary Community Investment Plan (2017-2021 Committee of the Whole Page 2 of 3 04/26/16 Finance Director Erb stated departments have submitted their first drafts for the Community Improvement Plan (CIP), previously known as the Capital Improvement Plan. He stated the CIP totals $74.2 million with first-year projects totaling $11.7 million. He provided an overview of CIP spending by department, project category and funding source. He stated that departments will be reviewing the CIP and deliver a proposed plan document June 16 to be discussed at the Joint Village Board and Finance Commission Workshop July 12. General comments from the Village Board and Finance Commission included the following items: • There was discussion regarding several specific projects, Public Safety Building Space Needs Study, cured -in -place -pipe repairs, and pump stations at Levee 37. • There was a discussion regarding the CIP document identifying which projects are new verse existing and also project priority for the past 5 years. • There was a question regarding if accelerated replacement programs would take replacements off cycle and would result in clumped purchases in the future. • There was general discussion regarding the motor fuel tax and funds allocated for road improvements. • There were questions regarding how the Village may use reserves and allocating funds for disaster recovery for severe weather and emergency events There was general consensus by the Village Board for the Finance Commission to continue the discussion regarding reviewing options for allocating reserves that exceed the 25% fund balance threshold for Village initiatives or capital projects. Louis Goodman, 310 N. School Street asked several questions regarding the Village budget, the Village's portion of the property tax levy, and the General Fund. There was also a question regarding available funds for the sidewalk replacement cost share program. V. ANY OTHER BUSINESS None VI. ADJOURNMENT The meeting adjourned at 8:33 p.m. ALEXANDER BERTOLUCCI Administrative Analyst Committee of the Whole Page 3 of 3 04/26/16