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HomeMy WebLinkAbout04/28/2005 FC minutes FINANCE COMMISSION CORRECTEDCORRECTED MM INUTES OF THE EETING A28, 2005 PRIL VHB ILLAGE ALL UILDING I. CO ALL TO RDER The meeting was called to order at 7:00 p.m. Those present included Chairman John Korn and Commissioners Charles Bennett, Vince Grochocinski, Rich Micelli, Ann Smilanic and Lee Williams. Also present were Deputy Director of Finance Carol Widmer and Finance Administrative Assistant Lisa Burkemper. Commissioner Tom Pekras was absent. Resident John Kellerhals observed the meeting. II. AM PPROVAL OF INUTES Commissioner Ann Smilanic motioned to approve the minutes of March 20, 2005 as corrected. Commissioner Vince Grochocinski seconded the motion and the minutes were accepted as corrected. Commissioner Charles Bennett abstained. III. DRRA– GCS ISCUSSION EGARDING EVENUE LTERNATIVES ENERAL AND OMBINED EWER Revenue Alternatives Deputy Director of Finance Carol Widmer handed out a spreadsheet outlining a summary of revenue alternatives and a summary of the projected 2006 – 2009 operating deficit. Ms. Widmer began by mentioning that the property tax levy does not cover the amount of money needed to fund the Police and Fire Pensions. The balance of money needed is normally taken from the general fund. There is currently a discussion about shifting the full burden of the Pensions to the levy so that the entire amount would be levied through the property taxes. Deputy Director Widmer discussed several of the revenue alternatives mentioned in the handout. Of the items discussed were the following: Property Tax, Home-Rule Sales Tax, Real Estate Transfer Tax, Hotel/Motel Tax, Food and Beverage Tax, Local Motor Fuel Tax and Utility Tax. Also discussed were Ambulance Billing, Business Licensing and Direct Billing for Refuse. Commissioner Rich Micelli asked if the commission could be provided with a better understanding of the breakdown between the number of ambulance calls to residents versus non-residents, so that they could more accurately calculate the amount of money currently being generated versus what potentially could be generated. After hearing an explanation from Deputy Director Widmer regarding the idea of direct bill of refuse offsetting the cost of eliminating the vehicle sticker, Commissioner Ann Smilanic added that she did not favor the idea because there was no benefit to the seniors. Commissioner Lee Williams asked what a typical business license costs. Ms. Widmer stated that the cost is based on the square footage of a property. Deputy Director of Finance Carol Widmer provided a brief overview of the Projected Operating Deficit – Summary of Alternatives worksheet. Ms. Widmer stated that the summary provided a projection on deficit figures based on the information available right now. There was a discussion on the layout of the spreadsheet and how the numbers were presented. Several members thought that with some modifications the spreadsheet would provide more informative information that was easier to follow. Chairman John Korn asked if the commission wanted to discuss a possible plan of action tonight on revenue alternatives or th use the time between now and the meeting on May 26 to individually come up with plans to discuss at the May meeting. Chairman John Korn also asked that the members be provided with a copy of the recommendations made last year to the Board regarding revenue enhancements. After a discussion the members decided to look their material over during the month th of May and revisit the discussion at the May 26 meeting. Combined Sewer Revenue Alternatives Deputy Director of Finance Carol Widmer handed out discussion documents regarding funding options for the Combined Sewer Project as well as Water and Sewer Rate Calculations. The funding options for the Combined Sewer Project focused on funding categories 4 and 5 of the project, which are the most critical areas. The handout outlined the differences between borrowing $4,000,000 for a 10 year versus a 15 year period. A spreadsheet was presented to the Finance Commission explaining what the Village's water and sewer rates should be to support expenditures in the 2005 budget. The formula used was to estimate the operations, debt service and capital expenditures less SSA #5 tax revenue and any other revenue produced. That figure was divided by the volume of gallons sold during the year to produce the rate needed. The computed rate was $3.50 for water and $1.63 for sewer for a total of $5.13. The current Village rates are $3.93 for water and $0.39 for sewer for a total of $4.32 per 1,000 gallons. Therefore, the water and sewer rate would have to increase $0.81 to support current expenditures. A similar spreadsheet was also presented for the year 2006 including an assumption for the debt service of $4,000,000 of bonds with either a 10 year or 15 year payback period to show what rates should be to support future expenditures. Commissioner Ann Smilanic mentioned that instead of borrowing money for the combined sewer project why not add a monthly customer fee to each water bill sent out to village water customers. Ms. Smilanic stated that such charges are currently added to her Nicor Gas as well as Commonwealth Edison bills. Commissioner Vince Grochocinski asked when the bonds for Special Service Area #5 mature. Ms. Widmer stated that the bonds are already paid off, but the service area continues in order to fund operations. Commissioner Rich Micelli and Chairman John Korn added that they agreed with Commissioner Smilanic’s suggestion on adding a customer charge to water bills. Commissioner Charles Bennett stated that he felt the customer charge should not be added to the water rate but instead tied to the sewer rate. Sewer rates should go up because the money is needed to fund the repairs to the sewer. There was a brief discussion by the members regarding doubling the sewer rate as well as adding the customer charge to water bills. Commissioner Rich Micelli was interested in seeing what amount of money would be generated if for example the sewer rate were doubled and a $5.00 flat customer fee were added to village water customer bills. th There was a discussion on possibly moving the May 26 meeting up to finish discussing revenue alternatives. Commissioner thth Charles Bennett motioned to give Chairman John Korn the authority to move the May 26 meeting to May 12 if the commission needed to make their revenue alternative recommendations to the Board in a more timely manner. Commissioner Lee Williams seconded the motion and the motion carried. IV. LRFPII - U ONG ANGE INANCIAL LAN PDATE Deputy Director of Finance Carol Widmer advised that there was no update available at this time. V. OB THER USINESS There was nothing to report. VI. C’R HAIRMANS EPORT Chairman John Korn highlighted the topics discussed at the board meetings that have taken place recently. 2 VII. FD’R INANCE IRECTORS EPORT Deputy Director of Finance Carol Widmer handed out a copy of the Finance Commission Articles. VIII. NM: M26, 2005 EXT EETINGAY Commissioner Charles Bennett motioned to adjourn which Commissioner Vince Grochocinski seconded. The meeting was adjourned at 9:10 p.m. The next meeting will be Thursday, May 26, 2005. Respectfully submitted, Lisa Burkemper Administrative Assistant Finance Department 3