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HomeMy WebLinkAboutCOW Agenda Packet 08/09/2005 COMMITTEE OF THE WHOLE AGENDA Meeting Location: Mount Prospect Village Hall 50 South Emerson Street Meeting Date and Time: Tuesday, August 9, 2005 7:00 p.m. I. CALL TO ORDER - ROLL CALL Mayor Irvana K. Wilks Trustee Timothy Corcoran Trustee Richard Lohrstorfer Trustee Paul Hoefert Trustee Michaele Skowron Trustee John Korn Trustee Michael Zadel II. ACCEPTANCE OF MINUTES OF COMMITTEE OF THE WHOLE MEETINGS OF: JUNE 14,2005 AND JULY 12, 2005 III. CITIZENS TO BE HEARD IV. SOLID WASTE CONTRACT RENEWAL In August 1991, the Village of Mount Prospect entered into a solid waste contract with ARC Disposal and Recycling Company, Inc. (ARC), and implemented a comprehensive solid waste management program that facilitated waste reduction and resource recovery. Throughout this fourteen (14) year period, the Village has maintained the modified volume- based collection system as well as the services of ARC. Residential solid waste services are currently regulated by the terms and conditions of the four (4) year nine (9) month contract executed in May of 2000. In accordance with contract provisions, the Village and ARC agreed to a one (1) year extension of the contract: January 1-December 31,2005. As authorized by the Village Board in July of this year, Public Works staff initiated discussion with ARC to explore viable service options and the Village's ability to secure an effective and efficient solid waste contract. At this time, staff is prepared to make recommendations regarding changes to the current collection system, and the manner in which a new contract is established. Mr. Brooke Beal, Executive Director of the Solid Waste Agency of Northern Cook County (SW ANCC) will also be on hand to provide additional analysis and insight. NOTE: ANY INDIVIDUAL WHO WOULD LIKE TO ATTEND THIS MEETING BUT BECAUSE OF A DISABILITY NEEDS SOME ACCOMMODATION TO PARTICIPATE, SHOULD CONTACT THE VILLAGE MANAGER'S OFFICE AT 50 SOUTH EMERSON, MOUNT PROSPECT, ILLINOIS 60056, 847/392-6000, EXTENSION 5327, TDD #847/392-6064. _.,----_._-_._--~.._---_._~~--------~-_._._--_._----_.---,._----_._-~~-- V. 2005 MID-YEAR BUDGET REVIEW AND 2006 PRE-BUDGET WORKSHOP Each year, the Village Board engages in a mid-year review of the current budget as a means of monitoring the revenue and expenditure levels contained therein. In addition, the Village Board also engages in a pre-budget workshop, specifically designed to look forward toward the upcoming budget year with the idea of setting fiscal parameters and giving staff direction for preparation of next year's budget. With the close of June financial activity, staff is in position to present mid-year financial data for 2005 as well as review the 2006 forecast budget. The Village continues to feel the effects of an improving economy. State shared revenues such as Income, Use, and Replacement taxes are up from the prior year. Although Sales taxes are up from the prior year, they still lag current year projections due to recent retailer closings. The balance of general revenues is at or above budget projections. We expect the General Fund to end 2005 with a surplus of $789,946. This is due to the sale of property originally expected in 2004 ($270,000) and a favorable balance in estimated revenues at year-end ($579,743). The surplus expected for 2005 in the General Fund will offset the deficit incurred in 2004 totaling $667,640. Although economic conditions have improved, the Village's 2006 budget forecast still shows a deficit of $745,813. This includes a planned transfer of $315,000 as part of the Village Hall funding plan. Finance Director David Erb has prepared a comprehensive memorandum detailing the Village's financial condition for both the balance of 2005 and forecast 2006. Staff will share its current budget preparation strategy and look to the Village Board for direction regarding the upcoming budget. Appropriate staff will be on hand to answer questions and facilitate discussion. VI. WATER & SEWER RATE STUDY AND COMBINED SEWER PROJECT FUNDING SOLUTION A study of the Village's combined sewer system was completed in 2004. The study showed extensive repairs were needed to the system estimated at $15,000,000 over a 10-year period. In addition, the Water and Sewer Fund has been operating at a deficit for the past several years as operating and capital expenditures exceeded revenues generated by user's charges. In response to these two items, a water rate study was conducted to determine the appropriate level for water and sewer charges. The study took into consideration the regular growth in operating expenses and the additional capital needs related to the combined sewer project. Staff will present the findings of the water rate study and provide to the Board a funding solution for the combined sewer project. Appropriate staff will be on hand to answer questions and facilitate discussion. VII. VILLAGE MANAGER'S REPORT VIII. ANY OTHER BUSINESS IX. ADJOURNMENT MINUTES COMMITTEE OF THE WHOLE JUNE 14, 2005 I. CALL TO ORDER The meeting was called to order at 7:07 p.m., in the Village Board Room of Village Hall, 50 South Emerson Street, by Mayor Irvana Wilks. Present at the meeting were: Trustees Paul Hoefert, John Korn, Richard Lohrstorfer, Michaele Skowron and Michael Zade!. Absent from the meeting was Trustee Timothy Corcoran. Staff members present included: Village Manager Michael Janonis, Assistant Village Manager David Strahl, Finance Director David Erb, Community Development Director William Cooney and Deputy Community Development Director Ellen Divita. II. APPROVAL OF MINUTES Approval of Minutes from March 22, 2005. A Motion was made by Trustee Hoefert and Seconded by Trustee Zade!. The Minutes were approved. Trustee Korn abstained. Approval of Minutes of April 26, 2005. A Motion was made by Trustee Zadel and Seconded by Trustee Skowron. Minutes were approved. Trustee Korn abstained. Approval of Minutes of May 24, 2005. A Motion was made by Trustee Hoefert and Seconded by Trustee Zade!. A request was made to add the name of Mark Miller as a Safety Commission member which was omitted from the Safety Commission list of the Minutes. Minutes were approved with modification. Trustee Lohrstorfer abstained. III. CITIZENS TO BE HEARD None. Village Manager Janonis announced the passing of Village Clerk Velma Lowe and provided information regarding the times, locations and dates of the services. IV. TIF - SUB-AREA #1 REDEVELOPMENT OPTION DISCUSSION Mayor Wilks stated the Village Board is prepared to move forward in some direction, however, there will be no decision tonight regarding that direction and is intended only to start the process of discussion. 1 Village Manager Janonis stated that the work of the Board will likely take the next six to nine months to arrive at a final decision regarding this Area. The Village Board commissioned DLK Architects to review Sub-Area #1 which is bounded by Northwest Highway, Route 83 and Busse Avenue. He also stated that representatives from W. B. Olson have been invited to participate in the discussion regarding cost options and related up charges likely with each option presented this evening. Community Development Director Bill Cooney provided an overview of the Area and summarized the discussions in the Report of the Second Ad Hoc Committee. He stated discussions regarding the extension and expansion of the TIF are currently under way. He stated some of the attributes of the existing buildings include the oldest commercial buildings in the community, currently viable businesses and affordable rents. He said the challenges that await any redevelopment include minimal private investment, limited functionality of existing structures including structural obsolescence, stagnant property values and lack of parking. Charlie Freidlander of DLK provided an overview of all the options that had been drafted by DLK Architecture. Option A, which contains the most preservation and the most likely significant cost premiums, was presented. Dave Olson of W. B. Olson stated the cost impacts would be significant related to construction staging and the required steps to save the front of the buildings and support them from behind. Community Development Director Bill Cooney stated that Option A provides limited retail value and tends to maximize residential units. Option B includes a single, five story structure with underground parking with a basement next to the buildings that are recommended for saving under this Option. There is some retail included and this is the smallest overall change to the Area but highly the highest cost per square foot. Option C contains two main retail parcels with surface parking for retail. The underground parking would not be part of the support for the retail operations. There would be foundation retention expenses. Option D would have the same retail issues as Option C, however, it includes more retail in the small triangle and more underground parking. Option E includes a large retail operation in the small triangle and Busse would be the surface parking area. Option F is a combination plan but also limits the additional cost that would include cost for upgrades of the buildings that would be retained. There would also be issues with modifying the existing buildings versus building new and the additional costs associated with such modifications would be higher than building new. 2 Dave Olson also stated that the facades could be duplicated with new materials to get an old-time look versus trying to retain the existing materials and there would be some difference that would be noticeable. The ability to reconstruct with previous materials would most likely not yield positive results. General comments from Village Board members included the following items: There was concern voiced about the amount of surface parking for retail and the costs associated with protecting existing buildings. It was also noted that some businesses would be driven out due to likely higher rents and currently this area enjoys lower rents associated with the quality of buildings and location. Gavin Kleespies, Executive Director of the Mount Prospect Historical Society spoke. He provided historical background on the area and noted that this is the initial commercial area within Mount Prospect and feels it defines Mount Prospect character. David Lindgren, Chair of the Economic Development Commission spoke. He stated that the Commission is planning to meet this week to discuss development options and would forward the Commission's recommendation to the Board after the meeting. Jean Reibel, Four North Pine Street, a local architect, feels that the combining of Options A and B with all new along Northwest Highway could be an option to consider. Tom Neitzke, owner of the business at 22 West Busse, spoke. He would prefer that everything be left alone as is. He stated he has concerns that just because the buildings have limited architectural value does not mean they have no value and stated that this Area allows lower rents for small business to start out and survive. Mike Reese, owner of the business at 50 West Busse, spoke. He owns His and Hers Hobbies. He stated he picked downtown Mount Prospect for his business because of the character of the buildings but did acknowledge they are getting rundown. He stated himself and several other business people in the Area have been reluctant to invest in the buildings because they are uncertain of the future of the properties. He suggested utilizing TIF money to upgrade the buildings. Jim Uszler, Executive Director of the Mount Prospect Chamber of Commerce, spoke. He stated it is necessary to get a certain amount of density to make the project work and felt that preservation of historical buildings could be accomplished through relocation. George Busse, 111 South Maple Street, spoke. He stated he is the former Chair of the Economic Development Commission. He stated the EDC felt the most significant redevelopment Option was to avoid a canyon effect and maintain some historical appearance where possible. He stated there is a need to move forward and change. The Area cannot grow and prosper without change. Tim Gear, Historical Society Board member and resident, spoke. He stated he is questioning how an Area is measured as viable and how it is defined. General comments from Village Board members included the following items: 3 ~'~x'~~"C"~""''''~''''',-c"~'"''='''''':''''''''.,==,!,-""",.=''='''l'''''::-r'7~""'""c~=~="'""=,~~~,"n'('=)'=",~,^,_""-,~,,,,,',,=;:!'R!'=f.=~,"~W-'""'''"-->~'-~-- It was noted that some of the Options have positives which could be combined into elements of other plans to create hybrid plans. There was also a question regarding the cost of bringing the buildings up to Code and the ongoing maintenance costs. The Village Board determined to eliminate Option E from further consideration. Village Manager Michael Janonis stated that discussion will continue regarding what could work for the entire area. V. UTILIZATION OF SIGNS IN THE DOWNTOWN AREA Community Development Director Bill Cooney provided a summary of the available options regarding some changes in downtown signage. Planning Intern Christine Park presented the information summarlzmg all the downtown sign recommendations. The sign types that are recommended are the use of pedestrian level oriented signs along the sidewalk, extended signs from the buildings in the B5 and B5C areas and kiosk signs which would include area information about businesses. She stated the downtown businesses have less opportunity for signage and staff is recommending the use of projecting signs extending from the buildings so that the business is more noticeable. The kiosk option is recommended for the train station which would identify businesses in the area and general interest items. She stated that most comparable towns do not allow A-frame signs but larger downtowns use A-frame signs under special circumstances. She stated the recommended criteria would include one A-frame sign per street side door adjacent to the building with a maximum 12" from the building and a minimum of five feet of sidewalk unobstructed. These signs are pedestrian oriented and would only be out during business hours and not during adverse weather conditions. They would need to be considered high-quality and professionally constructed and would require a Permit only if on public property. General comments from Village Board members included the following items: A concern was voiced regarding the safety of A-frame signs and the need to clearly define the quality and design requirements that illustrate the necessary quality. It was also recommended that a trial period be undertaken and then the program be re- evaluated after the trial. It was also stated that some clarification may be necessary regarding the number of signs allowed for businesses that happen to be on corner property. Ken Fritz, Mount Prospect resident, spoke. He stated he was involved in drafting the original Sign Code and felt that these recommendations standardizing the appearance of signs in the downtown was worthwhile. Katie Dix, owner of Capannari's Ice Cream and the Chair of the Downtown Merchants Association, spoke. She stated that utilizing the sign package that is recommended would encourage a branding concept for the area. Consensus of the Village Board was to consider the Ordinance as presented by staff if subsequent and sufficient oversight is included for maintaining the professional appearance. 4 VI. VILLAGE HALL ENTRANCE ENHANCEMENTS Assistant Village Manager David Strahl provided an overview of the proposals drafted by DLK for Board consideration. These enhancements include installation of banners on the east wall of the Village Hall including a banner above the main entrance doors of Emerson Street and the Route 83 side. Another option would be the installation of a glass panel above the main entrance door. These options also include the installation of paneling and a camouflage paneling on the fire panel wall in the main stairwell. , General comments from Village Board members included the following items: It was noted that the building functions extremely well and the overall block turned out very well. A shortcoming that has been commented on from constituents has focused on the entrance and the main stairwell. It was suggested that the porch area be considered a grand entrance which could incorporate the stairwell depending on Code limitations. Consensus of the Village Board was to postpone the decision regarding these proposals presented this evening and to request a design for review and pricing from DLK regarding main entrance enhancements including improvements of the portico area. Village Manager Mike Janonis requested a couple of Elected Officials participate in the design discussions. Trustee Hoefert and Mayor Wilks volunteered to participate in those discussions. VII. VILLAGE MANAGER'S REPORT Village Manager Mike Janonis stated the Farmers' Market is running on Sundays now. The Lions Club 4th of July Festival is scheduled to begin on June 29 and continue through July 5. He also stated there is no need for a Closed Session this evening. VIII. ADJOURNMENT DS/rcc There being no further discussion, the Committee of the Whole meeting adjourned at 10:39 p.m. Respectfully submitted, (/ ~a<~)~~ DAVID STRAHL Assistant Village Manager 5 Minutes Committee of the Whole July 12, 2005 I. CALL TO ORDER The meeting was called to order at 7:10 p.m. by Mayor Irvana Wilks. Present at the meeting were: Trustees A. John Korn, Michaele Skowron, and Michael Zade!. Staff members present included: Village Manager Michael Janonis, Finance Director David Erb, Deputy Finance Director Carol Widmer, Information Technology Director Joan Middleton, Fire Chief Michael Figolah, Deputy Fire Chief John Malcolm, EMS Coordinator Wendy Seleen, Police Chief Richard Eddington, Deputy Police Chief of Administration Michael Semkiu, Public Works Director Glen Andler and Deputy Public Works Director Sean Dorsey and Deputy Community Development Director Ellen Divita. II. APPROVAL OF MINUTES Approval of Minutes from June 14, 2005. Motion made by Trustee Zadel and Seconded by Trustee Skowron to defer approval of the minutes until the August 9, 2005 meeting. III. CITIZENS TO BE HEARD Kathleen Kowalski of 1818 E. Tano Lane in Mount Prospect asked for an update on the moving of fire station #14. Fire Chief Michael Figolah responded to the inquiry by stating that there are two items involved in the planning for the new fire station. The first item under consideration is the location of the station and that will not be decided until public meetings are held so that citizen input can be heard. The other item under consideration is the relocation of the fire mechanics to the Public Works Building. Chief Figolah said residents would be kept informed as process on the projects move along. IV. ANNUAL AUDIT OF VILLAGE FINANCES Finance Director David Erb reviewed the 2004 Comprehensive Annual Financial Report (CAFR). The Audit was performed by Sikich Gardner & Co., LLP for the Village for fiscal year ended December 31,2004. Sikich has given the Audit of the Village 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. The Village also received unqualified opinions on the Single Audit and the Tax Increment Finance (TIF) Audit. As part of the Audit, Sikich is required to present a management letter to the Village's governing board. The purpose of the management letter is to inform the board of any problems encountered during the audit and to report any deficiencies in internal controls uncovered during the course of the audit. The management letter from Sikich recommended the formation of an audit committee to be responsible for establishing an audit procurement policy as well as implementing and overseeing a fraud risk assessment program for the Village. Mr. Erb noted that a recommendation for a comprehensive audit policy is on tonight's agenda. Sikich also recommended marking all investments to market at year-end. Mr. Erb stated that investments are reconciled on a quarterly basis and controls are in place to ensure all investments are adjusted quarterly. Mr. Erb reported that the General Fund fund balance remains strong at 23.4%. He also stated that the 2004 audit report would be available at Village Hall, the library and the Village's web site. Mr. Erb introduced Lou Karrison, Partner at Sikich Gardner, who reviewed the management letter comments and confirmed Sikich's unqualified opinion of the Village's 2004 audit. The Village Board will formally approve the 2004 audit at its August 2 Village Board meeting. 1 V. RECOMMENDATION FOR A COMPREHENSIVE AUDIT POLICY Finance Director David Erb presented a recommendation for a comprehensive audit policy. The purpose of the policy is to assign oversight responsibility for the independent audit of the Village's financial statements from the selection of the independent auditor to the resolution of audit findings. It will also address procedures for monitoring compliance of the Village's fraud risk assessment program. The proposed make- up of the audit committee will consist of the following: Village President, member of the Board of Trustees, a member of the Finance Commission, a Mayoral appointee, and the Director of FinancelTreasurer. General discussion from the Village Board members included the following items: Several Trustees noted that the idea had merit. Manager Janonis stated that he would like to have the ordinance passed and the committee incorporated into Village Code by the end of the year. In response to a question regarding responsibilities, Mr. Erb said that the committee would be advisory and the Village Board would still be ultimately responsible for hiring the auditors. VI. 2006-2010 CAPITAL IMPROVEMENTS PLAN Mr. Erb presented the Village's proposed 2006-2010 Capital Improvements Plan (CIP). It is the 9th year that staff has prepared a CIP. The CIP is comprised of projects that involve the purchase or construction of long- lived, tangible assets at a cost of $25,000 or more. The total cost of all requests for all years included in the plan is approximately $48.9M. Since the CIP is a planning document, inclusion in the CIP does not guarantee funding. A total of $2.2M in projects have been deferred in the past four years due to funding considerations. The fund currently has a $1.7M fund balance but the fund balance will be negative sometime in 2007 unless a permanent funding source is identified. Deputy Community Development Director Ellen Divita highlighted the items related to Community Development. Mr. Janonis stated that the proposed expenditure of $200,000 for corridor improvements for 2006 could be scaled down to $50,000 for the year by concentrating on two or three small areas. This is the second year that Information Technology has been included in the CIP. While many of the expenditures do not meet the $25,000 minimum threshhold, IT is included as a planning tool. Joan Middleton, Information Technology Director discussed several of the items included in the proposed 2006 expenditures of $113,540. Among the items Joan mentioned were the proposed network rewiring of the Police and Fire building and centralized backup for the Village's servers. Police Chief Richard Eddington reviewed the four items the Police Department included in the proposed 2006 CIP. One of the items is the replacement of the digital mobile video recorders in the amount of $156,500. Chief Eddington said the department wants to purchase all of the recorders at one time for consistency and ease of maintenance. The other items include a prisoner transport van and replacement of chairs for the department. The fourth item, a Iivescan booking station was moved back from 2005 to 2006 in hopes that the department can secure a grant to help pay for the booking station. The Fire Department has no items in the proposed 2006 CIP. Fire Chief Mike Figolah did discuss proposed expenditures for 2007 which include replacing fire $tation#14, the Public Works building expansion, and a video conferencing system which would allow for training at all locations at the same time. Chief Figolah also mentioned that the Department may receive a FEMA grant for the SCBA upgrades scheduled for replacement beginning in 2010. If the grant is received, the SCBA upgrade would take place in 2006 at a cost of only $32,000 to the Village and $128,000 from the grant. Some of the issues discussed after Chief Figolah's presentation included the cost of the new station, the timing of construction, and space needs of the Police Department. It was suggested that the Village hire a consultant in 2006 to study space needs, costs of construction and phasing or timing of the project. The proposed 2006 CIP for the Public Works Department includes projects totaling $7,788,998. Public Works Director, Glen Andler, highlighted several of the items. Mr. Andler stated that he is working with the Finance Commission on recommendations for funding for the first phase of the multi-year combined sewer 2 -'-~'~'~<"''''''-'''-C"'"-_'''~_~''''''''''';_''''''''''''==''.''''''f",,=,.,,=~(.~,","==":m"~;=;o;~;m'"~'",,;,,,,=,,='>=;l=''_'2_'''d'H'',r~,''''''''''','''''=_=h''''''''.'''''''"=."7i=.rK"=X"""""'''''''''' improvement project. A total of $2,000,000 is proposed for 2006. A water tank rehabilitation in the amount of $200,000 is being proposed as well as an unfunded mandate for the United States EPA and the Illinois EPA for Stage 2 Disinfection By-Products for the water distribution system. The George Street bridge, the last of the Village's bridges, is scheduled to be rehabilitated in 2006. Mr. Andler also mentioned that the Police and Fire Building deck rehab is estimated to cost $180,000 in 2006 not the $80,000 in the CIP. The Public Works parking lot originally scheduled for 2006 will be deferred to 2007. Mr. Chuck Bennett, Chairman of the Finance Commission, addressed the Village Board at the conclusion of the CIP presentations. Mr. Bennett presented the Finance Commission's recommendations for revenue enhancements for the proposed 2006 budget. In order to fund the combined sewer improvement project, the Finance Commission is recommending a $5.00 per month customer service charge for all water customers. This will produce approximately $600,000 per year and will minimize the need for a bond issue to pay for the improvements. The Finance Commission also recommends instituting the charge as early as possible in 2005. As far as revenue enhancements for the General Fund, the Finance Commission recommends billing residents for ambulance transportation at a Medicare-approved rate. This fee will result in about $900,000 net of fees for a billing service to perform the billing. It is recommended that there be no balance billing for residents of Mount Prospect. The Finance Commission proposes increasing the local motor fuel tax from one cent per gallon to two cents per gallon. This would result in an additional $150,000 for the Street Improvement Fund. At the same time the $225,000 currently going into the Street Improvement Fund from a portion of the vehicle sticker fee would be reallocated to the General Fund. Finally, the Finance Commission suggests increasing the gas and electric utility tax from 3.2% to 4.2%. This would bring an additional $465,000 into the General Fund. In total approximately $1,590,000 of new revenue would be available to the General Fund in 2006. Mr. Janonis summarized the discussion on the 2006 budget by stating that the issues that needed to be resolved are funding for the General Fund, finding a permanent funding source for the CIP, preparing a facility needs study for the Police and Fire Departments, and funding for the combined sewer improvement project. Mr. Janonis remarked that we might consider a $1 M per year expenditure instead of $2M for the combined sewer project. VII. VILLAGE MANAGER'S REPORT Mr. Janonis mentioned the Harry Potter event, which will take place at Randhurst on July 15 and 16 when the book is released. Mr. Janonis also asked everyone to mark their calendars for the July 23 Midsummer Block Party downtown from 4:00 p.m. to 9:00 p.m. VIII. ANY OTHER BUSINESS Trustee Zadel recommended that a press release be sent out regarding the Lincoln Street bridge repair. IX. ADJOURNMENT There being no further business, the meeting adjourned at 9:17 p.m. Respectfully submitted, ~oGW~ Carol L. Widmer Deputy Finance Director 3 Village of Mount Prospect Mount Prospect, Illinois INTEROFFICE MEMORANDUM TO: VILLAGE MANAGER MICHAEL E. JANONIS FROM: VILLAGE CLERK DATE: AUGUST 3, 2005 SUBJECT: SOLID WASTE CONTRACT BackQround In August of 1991 the Village of Mount Prospect entered into a solid waste contract with ARC Disposal and Recycling Company, Inc. (ARC), and implemented a comprehensive solid waste management program that facilitated waste reduction and resource recovery. Throughout this fourteen (14) year period the Village has maintained the modified volume-based collection system as well as the services of ARC. Residential solid waste services are currently regulated by the terms and conditions of the four (4) year nine (9) month contract executed in May of 2000. In accordance with contract provisions the Village and ARC agreed to a one (1) year extension of the contract; January 1 - December 31, 2005. Discussion As authorized by the Village Board in July of this year, Public Works staff initiated discussions with ARC to explore viable service options, and the Village's ability to secure an effective and efficient solid waste contract. During this time staff also met with Mr. Brooke Beal, Executive Director of the Solid Waste Agency of Northern Cook County (SWANCC). Mr. Bears knowledge and experience in solid waste management provided staff with an insightful analysis of cost effective and efficient solid waste service options. Recommendations Based on the discussions with ARC Disposal and Recycling Company and Mr. Beal it is staff's recommendation that the Village engage in the development of a solid waste management system and contract as outlined: 1) Waive bid process 2) Negotiate with multiple vendors for residential solid waste services to include: · Automated wheeled cart collection system for refuse and recycling · Unlimited collection of refuse and recyclables · Loose leaf disposal/bagged leaf collection and disposal · Brush collection · Containerized yard waste collection - User fee system · Multifamily - centralized refuse and recycling collections · Residential contract agreement - five (5) years or longer · Exclusive commercial solid waste contract Staff anticipate that negotiations will conclude, and final recommendations for a new solid waste contract will be presented for the Village Board's consideration within the next thirty (30) days. '/71'~LJCp :4n#-12{ M. Li~Z;;~1I U c: Glen R. Andler Public Works Director I :\VL \WI N\publicworks\aug ust92005cowmemo. doc Mount Prospect INTEROFFICE MEMORANDUM Village of Mount Prospect Mount Prospect, Illinois TO: MICHAEL E. JANONIS, VILLAGE MANAGER FROM: DIRECTOR OF FINANCE DATE: AUGUST 4, 2005 SUBJECT: 2005 MID-YEAR REVIEW AND UPDATE OF THE 2006 BUDGET FORECAST Each year, the Finance Department prepares for the Village Board a mid-year review of the financial status of the current year's budget and a forecast for the upcoming year. This practice provides a solid foundation for preparation of the upcoming annual budget. This memorandum is intended to supplement the June 30, 2005 Budget Revenue and Expenditure Summaries that were submitted to the Board previously. The principal focus of this memorandum is on the General Fund, since it is the main operating fund of the Village. Also discussed to a lesser degree are a few of the more material operating and capital project funds. It should be pointed out that the current estimates of revenues and expenditures for 2005 are fluid and may change during the remaining six months of the fiscal year. 2005 MID-YEAR REVIEW GENERAL FUND The 2005 Adopted budget reflects a planned deficit of $804,727 on revenues of $33,122,688 and expenditures of $33,927,415. The deficit can be attributed to a $805,000 transfer to cover debt service on the new Village Hall. Excluding the transfer, the General Fund budget had a surplus of $273. The General Fund budget was amended this past May to account for carry-over items from the prior year's budget. Revenues increased $1,900 to $33,124,588 while expenditures increased $61,970. After amending the budget it now reflects a deficit of $864,797. As part of the mid-year review, we looked at all revenue and expenditure accounts to determine if any material variances were likely. We now expect total General Fund Mid-Year Budget Review August 4, 2005 Page 2 revenues to come in significantly higher than the original budget at $33,704,331, an increase of $579,743 over what was originally budgeted. In addition, $1,075,000 in revenue from the sale of property is expected in the General Fund for 2005. Expenditures are now estimated at $33,184,385, which is an increase of $61,970 from the original budget. The increase in expenditures is the result of budget amendments for carryover items. After adding the $805,000 transfer to the 2003 Debt Service Fund and the $1,075,000 from the sale of land, the General Fund is now expected to end the year with a surplus of $789,946. Exhibit 1 presents a summary of our current projections of revenues and expenditures, with a comparison to the amended budget. General Fund Revenues: General Fund revenues at June 30, 2004 were $14,286,515. This accounts for 43.13% of the amended budget. Being below 50% at mid-year should not be a concern as receipt of several significant revenues sources by the Village lag 1-3 months. These revenue sources include sales tax (both 1% ROT and .75% home-rule portions), income tax, utility taxes and other intergovernmental revenues. General Fund Revenue Collections as a Percent of Annual Budget 100% 80% - C 60% G) (.) lo.. 40% G) C. 20% 0% '0"" .<.,~"'r' 0~ "o~ ~ '0"" .<.,~"'r' ,0. O~ 0"" ~ <<0 'O~ >0' ~~ >0'0 '0<; 'O~ O~ ,;JJ ,o.C$ ,~ 0"" ~C$ (;'<::' .!:J'O ~'" ~0 '0"" <(~ ~'O f::o& ~~ 0<:::' ~~ ,:,.'0 ,<:::, ~"" ~'O ~0 ,:,.'0<:::' 1-.",,0 <<:-'0 ~.;s. '0" .~ OiS' <<:-0 Revenue Type The preceding chart illustrates the percent of revenues received by the Village in several categories as of June 30th. The current year-end estimate for revenues is over 1.7% above the original budget. Mid-Year Budget Review August 4, 2005 Page 3 Property tax revenues of $4,138,151 are running at 48.5% of budget. This is typical in that the first allotment of property taxes received is an estimate based on the prior year receipts while the second allotment, which come in later in the Fall, captures the levy increase approved in the current tax year. Our estimates account for a loss of 1.5% due to tax appeals and non-payment. The Village historically has added 2% for loss and cost to the annual levy to make up for the expected shortfall. In recent years though, the shortfall has been closer to 3%. It may be time to consider increasing the loss and cost amount to 3% for future levies. Based on average shortfalls over the past 5 years we expect our property tax receipts to come in at $8,277,455, or $256,004 below budget for the year. Revenues classified as "Other Taxes" include such sources as the .25% home-rule sales tax, food and beverage tax, real estate transfer tax, hotel/motel tax, telecommunications tax and the electric and gas utility taxes. In total, revenue collections from "Other Taxes" came to $2,635,683 as of June 30th, which is 38.4% of annual budget. Again, this is a category where there is a lag in receipt of two of the more significant revenues (home-rule sales tax and telecommunications tax). The Village's telecommunications tax is running 3.7% above budget while the Real Estate Transfer Tax is expected to come in $171,500 over original budget projections. This is due to the continuing strong housing market and new development throughout the Village. By year-end, we expect to exceed the budgeted amount by $620,169 for other taxes. Collections from licenses and permit fees totaled $2,003,515, or 78.0% of the $2.6 million budget. Vehicle license revenue of $986,876 is at 86.6% of budget, which is to be expected given that the deadline for the 2005/2006 vehicle sticker is April 30th. By year-end, we expect to exceed the budgeted amount by $54,576 for this revenue category . Intergovernmental revenues totaled $4,598,064 as of June 30th, which is 34.6% of the $13.2 million annual budget. Intergovernmental revenues in the General Fund include the local share of the state sales tax, state income tax, use tax, replacement tax and other miscellaneous state and federal grants. Sales tax collections, which make up more than 68% of the "Intergovernmental" category, are at $1,848,837. This represents 20.4% of budget. The current budget forecast is $8,604,295. Our year-to-date collections are running 1.2% above the same period last year, but expect collections to increase during the last half of the year as they typically do. Although revenue from this source continues to grow from the prior year, it is doing so at a rate slower than projections. The additional growth from Costco has been tempered a bit due to the closing of other significant retailers such as Circuit City and Old Navy. New retailers that have come on line in the past few months such Mid-Year Budget Review August 4, 2005 Page 4 as Staples and the soon to be open Steve and Barry's and Bed, Bath and Beyond stores should further prop up this important revenue source. Since we only have 3 months of data for the year, it is too early to determine the year-end projections accurately. To be conservative, I am projecting a shortfall of approximately 5%, or $452,000 from the original budget. Receipts from the State's distribution of the state income tax totaled $2,349,049 at June 30th. This represents an increase of 23.5% over the prior year. Changes to the Income Tax Refund Fund payments structure accounts for the large increase over the prior year. The per capita amount is calculated at just under $71.00. Future year's increases as estimated by the Illinois Municipal League are expected to be between 1- 2%. Currently we are expecting $524,476 over what was projected in 2005. The local share of the state use tax is expected to come in higher than projections for the year. Through June 30th, the State Use Tax is 7.2% higher than the same period for the prior year. $252,905 of the $545,120 budget has been received to date. We expect the year-end amount to be $534,433. There is a one-month lag in the receipt of the use tax. Revenue from Fines totaled $251,445 for the first six months. This represents 50% of the $505,000 budgeted for the year. We expect the revenue to meet our budgeted expectations for 2005. Investment income totaled $77,655 for the first six months, representing 50% of the $156,000 projected for the year. This amount represents a significant increase from the prior year where we generated only $45,069 for the entire year. More funds are available to be invested for the General Fund as interfund loans to other funds have been paid back. In addition, higher rates paid for short-term investments are being seen in the market. Miscellaneous Revenue, consisting of reimbursements and other revenues, totaled $230,835 as of June 30th. This is 50% of the $462,816 budgeted for the year. We expect these revenues to meet our budgeted projection for 2005. General Fund Expenditures: The amended 2005 budget totals $33,184,385 (see Exhibit 1). As of June 30th the Village had recorded expenditures of $15,354,106. Including fund transfers of $437,083, total expenditures for the General Fund are $15,791,189. This represents 46.5% of budget. As you would expect, at less than 4% off of the benchmark 50%, most of the departments are at or near the benchmark. Only Public Representation, the Manager's Office, and Miscellaneous Expenses deviate significantly from the benchmark. Mid-Year Budget Review August 4, 2005 Page 5 The following chart illustrates the General Fund expenditures by department/program as a percentage of annual budget at June 30. General Fund Expenditures as a Percent of Annual Budget Public Representation Manager's Office Television Services E III Clerk's Office ~ lJ) 0 Finance ~ c.. ;:J Comm. Dev. e::: CIl E Human Services t: III Q. Police CIl C Fire Public Works Misc. 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Percent Public Representation expenditures totaled $81,560 through June 30th, representing 69.5% of budget. The reason this program is above the 50% benchmark is that organizational memberships are typically paid in the beginning of the year. In the first half of the fiscal year membership dues totaling $33,778 were paid, compared to the annual budget of $33,000. Auditing Services is another item that is paid in its entirety in the first half of the year. Excluding these two items, spending through June 30th falls to the benchmark 50% Expenditures of the Village Manager's Office for the first six months totaled $771,810. This represents 36.9% of their $1.9 million annual budget. In addition to the budget for the Manager's Office, this budget includes Legal Services, Personnel Services, Information Technology and Public Information. Expenditures for the Personnel and Information Technology Division budgets are below the benchmark, 37.3% and 37.1% respectively as there are currently vacant positions that will be filled in the second half of the year. Legal expenditures are at 35.5% through June 30th. Mid-Year Budget Review August 4, 2005 Page 6 The Miscellaneous category in the above chart includes the Community and Civic Services budget program and the miscellaneous retirement pensions of two former employees. At the mid-year mark, miscellaneous expenditures of $112,659 represent 34% of the $331,078 budget. This shortfall from the benchmark is due to the timing of events such as the July 4th parade. For the past several years, total General Fund expenditures have come in anywhere from one to three percent under budget. Although we see no reason at this point to believe 2005 will be any different, to be conservative we have not shown any variance from budget for General Fund expenditures as reflected in Exhibit 1. The chart below shows budget to actual expenditures since 2001. Year , Am~ndedjBt.lddet Actual Exoanditl.ltes Variance 2001 $27,827,328 $27,546,963 1 .01 %J 2002 $28,599,479 $28,092,91 7 1 .77% 2003 $29,894,758 $29,045,233 2.84% 2004 $32,045,71 6 $31 ,835,052 0.66% REFUSE DISPOSAL FUND Revenues received to-date of $1,666,345 are 49.9% of projection. Expenditures for the first six months totaled $1,555,525, representing 42.8% of budget. MOTOR FUEL TAX FUND Revenues of $708,502 through June 30th represent 42.4% of projections. Our MFT allotments from the State are running 2.2% ahead of 2004. We had assumed a 1 % increase for the 2005 Budget. Expenditures totaled $1,379,465 at June 30th, which is 63.8% of budget. Although revenues are expected to come in higher, a budget shortfall of $28,623 is expected at year-end due to capital projects planned for this year. COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) FUND COBG Fund expenditures totaled $194,782 to-date. This is 26.2% of the $743,473 budgeted for the year. COBG expenditures fall into four categories. Following is a breakdown of expenditures incurred to-date, compared to annual budget for the four categories. Expenditures -;.'-:'.,'."'::<":::::"';"';"'.-'.':'".': . Y ear-to"-Date $ 26,099 50,178 65,278 53,227 $194,782 $ 71,623 105,500 268,350 298,000 $743,473 Percent · Ex. ended 36.4% 47.6 24.3 17.9 26.2% Administration Communit Pro rams Nei hborhood 1m rove. Residential Rehab Total Mid-Year Budget Review August 4, 2005 Page 7 Historically, the majority of CDBG expenditures have been incurred during the second half of the year. CAPITAL IMPROVEMENT FUND Revenues were projected at $231,276 for 2005. Through June 30th we have received $99,855 or 43.2% of budget. Other reimbursements and grant revenues of $112,400 are expected later in the year. The approved budget for this fund is $665,914. Total expenditures for the first six months were $48,834, or 7.3% of budget. Most of the capital projects and improvements budgeted for the year will be initiated during the summer months with payment occurring in the later part of the year. DOWNTOWN REDEVELOPMENT CONSTRUCTION FUND The 2005 Budget shows estimated revenues of $2,122,075. As of June 30th we had received $1,381,130. The major revenue sources for this year's budget consist of incremental property taxes (35.1 %) and proceeds from the sale of property (63.2%). The remaining 2% are derived from reimbursements and interest earnings. A total of $231 ,342 has been expended to date, which represents 79.5% of budget for 2005. $151,794 was for payment on two redevelopment incentive agreements with Northwest Electric and Norwood Builders. Capital work expected through the end of the year consists of fagade and brick sidewalk improvements and expenditures to support the interior build-out program. STREET IMPROVEMENT CONSTRUCTION FUND This fund was created to account for the 1997 revenue enhancements that are earmarked for the street improvement program. Revenues of $1,365,165 were projected for 2005. Revenues actually received as of June 30th total $387,618, or 28.4% of budget. Home rule sales taxes anticipated at $817,275 are expected to come in during the second half of the year. We expect revenues to meet our budgeted projection for 2005. A total of $1,165,709 has been budgeted for street resurfacing and reconstruction. As of June 30th $607,575, or 52.1%, has been expended. Capital projects remaining in 2005 are street light improvements, engineering for Wolf Road and the balance of work to finish the street-resurfacing program. FLOOD CONTROL CONSTRUCTION FUND The only revenue expected to be collected in this fund is interest income of $12,000. To-date, $21,850 has been received. The higher than expected amount is due to higher rates being offered in the market. Additional revenue sources to support expenditures Mid-Year Budget Review August 4, 2005 Page 8 in this fund are not expected until 2009. This is the expected date when a portion of the home rule sales tax becomes available as debt service requirements related to flood control projects is paid off. A total of $124,379 (21.3%) has been spent thus far out of the $583,413 annual budget. Only projects of higher priority are being done since we will be drawing down on fund balance to pay for the projects. Any project not deemed high priority has been deferred until after 2009 when additional monies become available. WA TER AND SEWER FUND Revenues through June 30th total $3,818,000, representing 44.9% of the $8,493,217 budget. This is typical, as water consumption increases during the summer months. In addition, there is a two-month lag for residential billing and one-month lag for commercial properties. Expenditures are budgeted at $9,279,528 for the year. After six months, actual expenditures have totaled $3,858,433, or 41.6% of budget. Expenditures appear to be low because of capital improvements planned for later in the year. There are no material variances expected between now and the end of the year. RISK MANAGEMENT FUND Revenues were budgeted at $5,679,931 for the year. Through June 30th we have received $2,944,805 or 51.8% of budget. We expect to meet revenue estimates for year-end. The approved budget for this fund is $5,669,350. Total expenditures for the first six months were $2,661,685, or 46.9% of budget. Expenditures for Liability and Workers' Compensation Claims are right at the benchmark 50% through six months while expenditures related to health insurance are under the benchmark at 45.9%. If this trend continues through the end of the year, we will end up with a slight surplus, which is a departure from the last couple years where we have seen a significant drop in fund balance due to budget deficits. POLICE AND FIREFIGHTERS' PENSION FUNDS Revenues in the Police and Firefighters' Pension Funds are falling below the benchmark 50% due to lower than expected earnings in both the fixed income and equity portions of the portfolios. The Fire Pension portfolio for the six months ended June 30 has earned 2.9% while the assumed rate for actuarial purposes is 8%. The Police Pension is in a similar situation earning 2.8% on its portfolio. Pension contributions and property tax revenues are expected to come in at or near budget. Expenditures for pensions are at 48.8% of budget through six months and are also expected to come in at budget. Mid-Year Budget Review August4,2005 Page 9 2006 FORECAST The 2005 Annual Budget includes a forecast budget for the year 2006 for each operating and capital project funds. The purpose of this portion of this memorandum is to bring forward any material variances in revenues or expenditures now expected for the year 2006. GENERAL FUND Exhibit 2 has been prepared to compare the original forecast numbers to our most recent estimates. The original forecast budget shows an operating deficit of $1,101,577 on revenues of $33,946,524 and expenditures totaling $35,048,101. Including fund transfers, the total projected deficit for the General Fund for 2006 is $1,416,577. Our more recent estimates now show that the operating deficit has been reduced to $745,813. Increases to several state shared revenues as well as to local taxes account for this reduction. In addition, projected contributions for the Police and Fire Pensions will fall by a combined $71,625 due to favorable actuarial estimates from 2003. Revenues: At this time we expect General Fund revenues for 2006 to come in $599,139 higher than what was projected twelve months ago. The forecast assumes that the overall property tax increase will be 5.0% with a portion of the increase going towards debt service on the new village hall. Sales tax receipts are expected to come in below the original 2006 forecast. Sales from Costco have been tempered a bit due to the closings of other retailers. I have projected an increase of 3% from the 2005 estimate to account for normal growth and new retailers such as Steve and Barry's and Bed, Bath and Beyond. The projection for utility taxes is expected to increase $175,060 due to higher than expected growth in the prior year. The increase expected from the final 2005 estimate is 1%. Real Estate Transfer Tax receipts have been strong since 2002 with the Village receiving over $1 million from this revenue source in each of the last three years. Much of this growth had to do with the downtown redevelopment and strong housing market. Although we expect 2005 to end up at $1.1 million for the year, we have elected to scale back the projection for 2006 to account for the nearing completion of downtown redevelopment and a possible slowdown in the housing market. Mid-Year Budget Review August 4,2005 Page 10 Expenditures: At this time we are expecting expenditures to remain consistent with the original forecast with the exception of pension contributions. Contribution rates went down for Fire Pension while there was a slight increase in the rate for the Police Pension. We had projected a 10 percent increase to both the Police and Fire pension contributions for 2006. Actuarial estimates calculated the increase in Police to be 15.7% while the Fire rate actually dropped 1.3%. Interest earnings on the investment portfolios for both the Police and IMRF pensions remain weak through 2005 which will have a negative impact for contributions in the 2007 budget. The impact is not known at this time. BUDGET CALENDAR Attached as Exhibit 3 is the 2006 budget calendar as presented in the current 2005 budget document. If this schedule now presents any conflicts, we should revise it as soon as possible. YEAR 2006 BUDGET DIRECTION Finally, I have attached a copy of the New Project/Service Suggestion Form (Exhibit 4). This form is intended for use by the Village Board to facilitate communication between the Board and staff concerning any new ideas they would like to see included in the 2006 proposed budget. It would be helpful if the forms could be returned to you by September 2, 2005 so that the ideas can be incorporated in to our preliminary budget deliberations. ..~cc: DAVID O. ERB DIRECTOR OF FINANCE Copy: Finance Commission Members Department Directors _ __ ___ ~~.~..._.__.._.~,_.._,_.~'..^_'..w'"~,~"""~'__m~'.'''=,~.,~_.~.y,.___.~,__"..",.=_~"""""""_.""",=~,.___=,,,,,,.~_____._"'__._.~.__'"""'''''''''''''"'...,."',."._,_''''''''''.,:;"=,,.=_=,,,''','~..N'W'='__="':"""_"'""",..".o""""=---_"""_~"'''''=___==_''''~~~o~_ Exhibit 1 Village of Mount Prospect, Illinois General Fund - Revenues and Expenditures 2005 End-of-Year Projection Budget 2005 YTD Actual 2005 Variance- 2004 Amended 01/01/05- Current Favorable Actual Budget 6/30/2005 Estimate (Unfavorable) Notes Revenues: - Property Taxes 7,965,530 8,533,459 4,138,151 8,277,455 (256,004 ) A Sales Taxes - ROT Portion 7,964,169 9,056,295 1,848,837 8,604,295 (452,000) B Sales Taxes - HMR Portion 1,179,529 1,152,275 274,192 1,266,775 114,500 C Food and Beverage Tax 495,486 448,800 200,446 518,500 69,700 D Real Estate Transfer Tax 1,143,518 928,500 592,284 1,100,000 171,500 E Telecommunications Tax 2,119,308 2,507,442 654,480 2,600,000 92,558 F Utility Taxes 1,247,803 1,630,250 836,557 1,802,161 171,911 G Other Taxes 183,741 188,700 77,724 188,700 0 Vehicle Licenses 1,125,230 1,140,000 986,876 1,140,000 0 Other Licenses, Permits, Fees 1,673,700 1,429,500 1,016,639 1,484,076 54,576 H State Income Tax 3,575,784 3,436,580 2,349,049 3,961,056 524,476 I Other Intergovernmental 953,106 779,540 400,178 868,066 88,526 I Charges for Services 749,216 769,431 351,167 769,431 0 Fines and Forfeits 554,741 505,000 251 ,445 505,000 0 Investment Income 45,869 156,000 77,655 156,000 0 Reimbursements 179,948 285,116 130,191 285,116 0 Other Revenue 280,734 177,700 100,644 177,700 0 Total Revenues 31,437,412 33,124,588 14,286,515 33,704,331 579,743 Expenditures Public Representation 108,884 117,383 81,560 117,383 0 Village Manager's Office 2,101,737 1,947,752 771,810 1,947,752 0 Television Services Division 161,903 213,757 112,802 213,757 0 Village Clerk's Office 163,656 171,874 81,758 171,874 0 Finance Department 1,351,088 1,570,355 748,200 1,570,355 0 Community Development Dept. 1,481,617 1,693,426 751,327 1,693,426 0 Human Services Dept. 702,815 720,533 310,756 720,533 0 Police Department 11,356,202 11,655,483 5,486,534 11,655,483 0 Fire Department 8,866,769 9,388,066 4,434,082 9,388,066 0 Public Works Department 5,212,118 5,374,678 2,462,618 5,374,678 0 Community and Civic Services 274,491 276,448 85,315 276,448 0 Miscellaneous 53,772 54,630 27,344 54,630 0 Total Expenditures 31,835,052 33,184,385 15,354,106 33,184,385 0 Excess of Revenues over Expend. (397,640) (59,797) (1,067,591 ) 519,946 579,743 Other Financing Sources/Uses Transfer to 2003 D/S Fund (270,000) (805,000) (437,083) (805,000) 0 Sale of Land 0 0 500,000 1,075,000 1,075,000 J Total Other Financing Uses (270,000) (805,000) 62,917 270,000 1,075,000 Excess of Revenues over Expend. and Other Financing Uses: (667,640) (864,797) (1,004,674) 789,946 1,654,743 General Fund Revenues and Expenditures - 2005 ________.~____..._~__~_~_._,___.~~^~~__~-~~-~."r"""""""""'='..==~""".=_~".,.,'''''''''''''''=''''''''~_,,_=_=_-~_ Exhibit 1 Village ot Mount Prospect, Illinois General Fund - Revenues and Expenditures 2005 End-ot-Year Projection Notes A Expect a 3% shortfall due to non-payment. Historically had used 1.5%. B Based on year to date receipts and expectations for the balance of the year. C Based on year to date receipts. D Higher than expected growth in the prior year continuing into this year. E Continued strong housing market and significant new development within the Village. F Based on year to date receipts. H Based on year to date receipts. G Based on year to date receipts. H Higher than expected building permit activity. I Changes to the Income Tax Refund Fund distribution formula (Income Tax) and higher than expected receipts for state shared revenues (Use and Replacement Taxes). J Sale of property anticipated in the prior year, but not received until this year. General Fund Revenues and Expenditures - 2005 ____,_.._~_,__^__._~._..___._^__.__.'_~._'._.,'~.__.~~,~",."=-,~.,_,.',_"",,,,,,,.=,,,,,"_=,,",,,=""""'.==r-M-'''''''''="_'.,,,,,,,,,,,,^==,,,,,,,,=:,;,,,,,",,"',",,'.Y!'.'V?<~-,'''''''''''+:';''~''''''C:;''''''',.~.o:,w.,>,:."<,=".."^""""_",,,,,.,,,._,,,,,,_,,,,=.,',,,,,,,,.,,,,,,,,~.~_~_===-"'>==<<="""'="",.",""""""""",,,,,"",=,.,"'.,,,, Exhibit 2 Village of Mount Prospect, Illinois General Fund - Revenues and Expenditures 2006 Forecast 2005 2006 Forecast Current Original Current Increase Percent Projections Forecast Forecast (Decrease ) Change Notes Revenues: Property Taxes 8,277,455 8,917,770 8,917,770 0 0.00 Sales Taxes - ROT Portion 8,604,295 9,237,420 8,862,500 (374,920) (4.06) A Sales Taxes - HMR Portion 1,266,775 1,186,850 1,304,750 117,900 9.93 B Food and Beverage Tax 518,500 457,750 523,750 66,000 14.42 C Real Estate Transfer Tax 1,100,000 928,500 928,500 0 0.00 Telecommunications Tax 2,600,000 2,557,591 2,626,000 68,409 2.67 D Utility Taxes 1,802,161 1 ,645,190 1,820,250 175,060 10.64 E Other Taxes 188,700 189,300 160,300 (29,000) (15.32) F Vehicle Licenses 1,140,000 1,140,000 1,140,000 0 0.00 Other Licenses, Permits, Fees 1,484,076 1,429,500 1,429,500 0 0.00 State Income Tax 3,961,056 3,539,700 3,994,815 455,115 12.86 G Other Intergovernmental 868,066 792,925 913,500 120,575 15.21 H Charges for Services 769,431 792,008 792,008 0 0.00 Fines and Forfeits 505,000 506,000 506,000 0 0.00 Investment Income 156,000 156,000 156,000 0 0.00 Reimbursements 285,116 292,320 292,320 0 0.00 Other Revenue 177,700 177,700 177,700 0 0.00 Total Revenues 33,704,331 33,946,524 34,545,663 599,139 1.76 Expenditures Public Representation 117,383 119,867 119,867 0 0.00 Village Manager's Office 1,947,752 2,110,229 2,110,229 0 0.00 Television Services Division 213,757 207,596 207,596 0 0.00 Village Clerk's Office 171,874 180,786 180,786 0 0.00 Finance Department 1,570,355 1,660,723 1,660,723 0 0.00 Community Development Dept. 1 ,693,426 1,773,705 1,773,705 0 0.00 Human Services Dept. 720,533 757,397 757,397 0 0.00 Police Department 11 ,655,483 12,273,037 12,334,581 61,544 0.50 Fire Department 9,388,066 9,981,807 9,848,638 (133,169) (1.33) Public Works Department 5,374,678 5,651,988 5,651,988 0 0.00 Community and Civic Services 276,448 275,418 275,418 0 0.00 Miscellaneous 54,630 55,548 55,548 0 0.00 Total Expenditures 33,184,385 35,048,101 34,976,476 (71,625) (0.20) Excess of Revenues over Expend. 519,946 (1,101,577) (430,813) 670,764 Other Financing Sources/Uses Transfer to 2003 D/S Fund (805,000) (315,000) (315,000) 0 Sale of Land 1,075,000 0 0 0 Total Other Financing Uses 270,000 (315,000) (315,000) 0 Excess of Revenues over Expend. and Other Financing Uses: 789,946 (1,416,577) (745,813) 670,764 2006 General Fund Forecast ___~______.______...___.^_.___.~._,_~v.,_,,~,_"'y'"'_<.'~n'''_~~'~'_''''''''''',_''',''"'_'_''~_,,,,=~,,~,=,,,,,,,,,,,,,,,,,:,,,,,_,,,,,,~,,,'.",'=,^,,,,',~,"''''''~',=.-=.-,,,,-,=:_,,.,,.---,,",,,",,,"_'>:"'''';'''=')~''~"''"''''"''''''-''''-",=>''-''''''"",'''''"",--",''''''''--'=----''''''"""",,,,,'''='''',".,..,,,~...,.,....,., Exhibit 2 Village of Mount Prospect, Illinois General Fund - Revenues and Expenditures 2006 Forecast Notes A Sales tax receipts estimated to increase 3% over 2005 projected amounts. B Home rule sales tax receipts estimated to increase 3% over 2005 projected amounts. C Higher than expected projection for 2005. 1 % growth estimated for 2006. D Higher than expected projection for 2005. 1% growth estimated for 2006. E Higher than expected projection for 2005. 1 % growth estimated for 2006. F Potential reallocation of Foreign Fire Tax distribution. G Increases in Income Taxes received from the State. H Increase in Replacement and Use Taxes received from State. I Adjustment to estimated pension contributions based on actuarial estimates. 2006 General Fund Forecast _ __________________~=~~"~_==''''~-,,=j==.'''':r_,==.''''o._.,''""~~.,.~..'~.,,'''~,~.. .~> ""..________.,,"""~~"""'=,:,..,,""~"'"=>''''"c== ~ Exhibit 3 VILLAGE OF MOUNT PROSPECT BUDGET CALENDARS 2005 and 2006 2005 2006 DATE ACTION DATE 3/1 0/04 Captial Improvement Plan (CIP) Worksheets forwarded to Department Directors 3/8/05 4/9/04 Completed CIP Worksheets returned to Finance Department 4/8/05 5/10/04 Department CIP reviews with Village Manger and Finance Director 5/9/05 to 5/14/04 to 5/13/05 5/21/04 Complete Proposed CIP Amounts 5/20/05 6/4/04 Deliver Proposed CIP to Village Board and Finance Commission 6/1 0/05 6/24/04 Review Proposed CIP with Finance Commission 6/23/05 7/13/04 Committee ofthe Whole - CIP Review Session 7/12/05 7/20/04 Acceptance of Proposed CIP at Village Board Meeting 7/19/05 7/23/04 Budget Worksheets forwarded to Department Directors 7/22/05 8/3/04 CIP available for distribution 8/5/05 8/10/04 Committee of the Whole - Mid-Year Budget Review and Pre-Budget Workshop 8/9/05 8/13/04 Completed Budget Worksheets returned to Finance Department 8/12/05 8/20/04 Revenue Estimates completed by Finance Department 8/12/05 9/8/04 Department Budget reviews with Village Manager and Finance Director 9/12/05 to 9/15/04 to 9/16/05 9/22/04 Complete Proposed Budget Amounts 9/23/05 ._ __,~,__"'_"m_'~..~,__,'.""__~,,,_,,,__~_~._,,~",",,,^,,."".~,""""""..,~"=~-==~"""~,__=,"~."",.~",,,,.,.,%.,,,...,,,,,~,,,,,~""""'t<"~)~"""""""<;>'''''''"'''''''''''''''''"",,,,=,,,~~,,,,,,,,,--,------~"'''''''' 2005 DATE VILLAGE OF MOUNT PROSPECT BUDGET CALENDARS 2005 and 2006 ACTION 2006 DATE 10/5/04 10/5/04 10/14/04 10/21/04 10/28/04 11/4/04 10/26/04 11/9/04 11/23/04 12/7/04 12/7/04 12/21/04 1/18/05 Deliver Proposed Budget to Village Board and Finance Commission Proposed Budget available for public inspection at the Village Clerk's Office and the Mount Prospect Public Library Review of Proposed Budget with the Finance Commission Committee of the Whole - First Budget Hearing (7:00pm - 10:00pm) Overview, Community Development, Police, Fire and Human Services Committee of the Whole - Second Budget Hearing (7:00pm - 10:00pm) Public Works, Village Administration, Non Departmental and Finance Committee of the Whole - Third Budget Hearing (7:00pm - 10:0Opm) (If Necessary) Truth in Taxation Public Hearing First Reading of Proposed Budget Ordinance at Village Board Meeting Public Hearing and Second Reading of Proposed Budget Ordinance at Village Board Meeting Approved Budget available for distribution 10/7/05 10/7/05 10/13/05 10/20/05 10/27/05 10/25/05 11/8/05 11/22/05 12/6/05 12/6/05 12/20/05 1/20/06 Exhibit 4 Village of Mount Prospect, Illinois New Service / Project Suggestion Form 2006 Budget Suggested by: New Service/Project Name: Description of New Service/Project: Estimated Cost (if known): Potential Source of Funds: Please return this form to the Village Manager by Friday, September 2, 2005. This area for the use of the Village Manager Assigned to the Department of : Comments: Signature of the Village Manager _ ____,_~.____~.~"'____=___=""""'_~~_a=""""""=c.~"""'==_~.-,,:=""=_"'t==._"""""""=_'."'''".'~~'''''''=- INTEROFFICE MEMORANDUM Village of Mount Prospect Mount Prospect, Illinois TO: MICHAEL E. JANONIS, VILLAGE MANAGER FROM: DIRECTOR OF FINANCE DATE: AUGUST 5, 2005 SUBJECT: WATER & SEWER RATE STUDY AND COMBINED SEWER PROJECT FUNDING SOLUTION PURPOSE To present the results of a water and sewer rate study conducted for the purpose of funding water and sewer operations and provide a funding source for the combined sewer project. BACKGROUND A study of the Village's combined sewer system was completed in 2004. The study showed extensive repairs were needed to the system estimated at $15,000,000 over a 10-year period. In addition, the Water and Sewer Fund has been operating at a deficit for the past several years as operating and capital expenditures exceeded revenues generated by user charges. In response to these two items, a water rate study was conducted to determine the appropriate level for water and sewer charges. The study took into consideration the regular growth in operating expenses and the additional capital needs related to the combined sewer project. DISCUSSION The Water and Sewer Fund is classified as a Proprietary Fund, which means revenue generated through user charges and other water and sewer related functions is intended to fully support the operation of the fund. Over the past several years this has not been the case. Expenditures for operating and capital items have exceeded annual revenue causing a draw down of fund balance. Although fund balance in the Water and Sewer Fund remains strong (currently above 25%), this spending pattern cannot continue without an adjustment to the water and sewer rate structure. In addition, a new funding source is needed to support the current and future capital needs of the water and sewer system. An analysis was conducted on the water and sewer fund to determine the appropriate level of user charges needed to support regular operating expenditures. Included in the attachments are summary sheets of the results of the study. Attachment A is a summary of projected operating and capital expenses for the five-year period 2006-2010. Attachment B is a summary of water and sewer rate projections needed to support the projected spending plan during the same five-year period. Attachments C1-C5 are the individual rate calculation sheets illustrating how the rate projections were derived. Attachment D is a summary of rates being charged by other JAWA communities, Mount Prospect residents supplied by Illinois American Water and the communities supported by the Northwest Water Commission. An explanation of each of the attachment will follow. Water & Sewer Rate Study and Combined Sewer Project Funding Solution August 5, 2005 Page 2 Attachment A is a summary of projected operating and capital expenses for the five-year period beginning 2006. This information was pulled from the Five-Year CIP with no changes except for one item. In the Five-Year CIP, the combined sewer project anticipated expenditures of $2 million in each of the first two years then $1.5 million for the remaining three years. In Attachment A, the amount budgeted each year for the project has been reduced to $1 million. Discussions with the Director of Public Works indicated that the issues listed in the combined sewer project study could be addressed at this lower spending level although it will take approximately fifteen years to complete versus ten years under the original plan. Column one of Attachment A shows total annual expenditures for the Water and Sewer Fund. The next three columns show capital projects broken down by water and sewer functions with a sub- total for all capital expenditures. The last three columns show the operating expenditures again broken down by water and sewer with an operating sub-total. The final column is the average growth in operating expenditures over the five-year period. Based on this information, the growth in operating expenditures averages 4.37%. If you recall, the annual increase to water rates has been 4% the past several years. This was done to have more moderate increases on a regular basis than large spikes to the rate every few years. Attachment B is a summary of water and sewer rate projections needed to support the projected spending plan during the five-year period. The first four columns show the projected water rate, projected sewer rate, the combined total rate and percent increase from the prior year. Based on the current spending plan, rates in the first year are projected to go up 20.5%. The large increase in the first year is due to several factors. First, annual rate increases in the past have failed to keep pace with the normal growth in operating expenditures. Second, a portion of the water rate has been subsidizing sewer expenditures. The current sewer rate is $0.40. The actual rate needed to support the sewer function in 2005 is $1.36. Finally, capital projects have been funded using available fund balance rather than through current revenues. The increase for years two through five show a downward trend from 11.5% in year two to just 1 % in year five. This is due to lower planned capital expenditures for these years (see Attachment A). For comparison purposes a schedule showing how the rates would be affected if a flat annual increase of 5% (after the initial increase) were used rather than the trending schedule calculated under the expenditure formula (final two columns). As you can see by year four, the projected rates under both methods are nearly identical. It would be at this point where we would next evaluate water and sewer rates. Attachments C1 through C5 are the individual rate calculation worksheets illustrating how the rate projections were derived. The top section of each worksheet includes the formula used to arrive at the projected water rate. The water rate includes an operating and a capital expense component. Revenues generated outside the water charge are deducted from total expenses. For water purposes these are Special Service Area taxes and other miscellaneous revenues (interest income, tap-on fees). The new total is then divided by estimated number of gallons billed (1,457,175) to come up with the projected water rate. As a side note, the Special Service Levy adds approximately $1.05 per 1,000 gallons to the water and sewer rate and is set to expire in 2017 per Village Ordinance. The next section of the worksheet includes the formula used to arrive at the projected sewer rate. Again, the sewer rate consists of an operating and a capital expense component. Like the water rate, revenues generated outside of sewer charges are deducted from total expenses. For sewer Water & Sewer Rate Study and Combined Sewer Project Funding Solution August 5, 2005 Page 3 purposes this includes interest income and other miscellaneous revenues. The new total is then divided by estimated number of gallons billed (1,457,175) to come up with the projected sewer rate. The new revenue component under this section is made up of a proposed monthly customer service fee and an additional amount to be added to the sewer rate. These additional revenues would be used to support the combined sewer project. The monthly service fee is proposed at $5.00 per month. The additional amount added to the sewer rate is $0.26. These charges will be described in further detail later in this memo. The third section of the worksheet provides information on the current rate, the proposed rate according to the expenditure formula and actual rate adjustment that would be made. This section also includes the dollar and percent increase from the current rate to the actual rate adjustment. For example, on Attachment C1, the current water rate is $4.09. The current sewer rate is $0.40 for a total combined rate of $4.49. The proposed rate per the formula is $3.78 for water and $1.37 for sewer for a total combined rate of $5.15. The actual rate adjustment would be $4.09 for water and $1.06 for sewer for the same combined rate of $5.15. Rather than adjust downward the current water rate, the sewer rate increase was reduced to return the same combined rate as the formula. The sewer and water rates would then be corrected in the following year to reflect their appropriate amounts. The increase in the rate from 2005 to 2006 is $.66 or 14.8%. Including the new revenue component needed to fund the combined sewer project, the increase in the rate is $0.92 or 20.5%. The last section of the worksheet describes the new revenue component of the sewer rate calculation. In order to fund the projected $1 million annual combined sewer project expense, a monthly customer sewer fee is proposed. The monthly fee of $5.00 per month is proposed. Based on the number of accounts currently active with the Village, this new fee will generate $628,140. The balance of the $1 million needed is proposed to come from an additional sewer charge of $0.26 per 1,000 gallons. This additional sewer fee will generate $378,866. For comparison purposes, if the sewer service fee were to be increased to $7.50 per month, it would generate $942,210 annually. This lowers the additional amount needed from the sewer rate to $0.04. The monthly service fee could be implemented immediately to begin building a reserve for the combined sewer project. Attachment D is a summary of rates being charged by other JAWA communities, Mount Prospect residents supplied by Illinois American Water and the communities supported by the Northwest Water Commission. The current Mount Prospect combined rate for those users on the Village water system is $4.49 (per 1,000 gallons). The average rate among the communities surveyed is $4.47 with a high rate being ch'arged to Mount Prospect residents serviced by Illinois American Water ($7.30). The low rate is from Elk Grove Village with a rate of $3.67. Four of the ten communities charge a monthly service fee that ranges from $5.20 to $9.00 month. Three communities were able to provided future projected increases in their water and sewer rates. These projected increases range from 5% to 5.89%. Water & Sewer Rate Study and Combined Sewer Project Funding Solution August 5, 2005 Page 4 CONCLUSION The rate increases being recommended are necessary to maintain the funding needed to support ongoing operations. In addition, the new revenue component for the sewer function is necessary for support of the combined sewer project on a pay as you go basis. The additional cost to the typical homeowner as a result of these rate increases is $148.32 per year. Increases to Village water and sewer rates have traditionally been done on June 1. Along with the proposed rate increases we would recommend to move the annual rate increase from June 1 to January 1 to match the Village's budget cycle. The initial rate increase would be anticipated for January 1, 2006. RECOMENDA TION It is recommended that the Village Board approve the following: 1) Implement a monthly service fee for all users of $5.00 beginning as soon as possible; and 2) Implement the proposed rate increase for the first year from the current combined rate of $4.49 to $5.41 beginning January 1, 2006; and 3) Authorize future annual water and sewer rate increase of 5% each January 1, thereafter (!:l~ ~. DAVID O. ERB DIRECTOR OF FINANCE DOE Copy: Finance Commission 1:\Water & Sewer\W&S Rate Study Memorandum.doc Village of Mount Prospect Water and Sewer Expenditures Operating and Capital 2006 - 2010 % Growth in Water Sewer Sub-Total Water Sewer Sub-Total Operating Year Total Capital Capital Capital Operating Operating Operating Expenses 2006 10,229,238 1,006,710 1,428,975 2,435,685 6,178,450 1,615,103 7,793,553 2007 11,127,925 1,551,475 1,458,500 3,009,975 6,439,669 1,678,281 8,117,950 4.16% 2008 11,179,537 1,346,968 1,358,500 2,705,468 6,721,748 1,752,321 8,4 74,069 4.39% 2009 11,382,223 1,144,005 1,388,500 2,532,505 7,018,912 1,830,806 8,849,718 4.43% 2010 11,465,434 810,612 1,408,500 2,219,112 7,332,220 1,914,103 9,246,322 4.48% Average Growth 2006-2010 4.37% )> ~ ~ Q) (") ::T 3 CD ::J ~ )> Village of Mount Prospect Water/Sewer Rate Summary 2005 - 2010 Per Expenditure Formula Per 5% Formula Year Water Rate Sewer Rate Total Rate % Increase Total Rate % Increase Current Water and Sewer Rates 2005 $4.09 $0.40 $4.49 - $4.49 Proposed Water and Sewer Rates 2006 $4.09 $1.32 $5.41 20.5% $5.41 20.5% 2007 $4.34 $1.69 $6.03 11.5% $5.68 5.0% 2008 $4.37 $1.69 $6.06 0.5% $5.96 5.0% 2009 $4.45 $1.75 $6.20 2.3% $6.26 5.0% 2010 $4.45 $1.81 $6.26 1.0% $6.58 5.0% )> ....... ....... ID (') :T 3 CD ::J ....... OJ Village of Mount Prospect Water and Sewer Rate Calculation 2006 Budget Year Attachment C1 Water Rate Formula: WR = (OP + DS + Cap - SSA5 - OR) ! Vol Where: WR = Water Rate OP = Operations Expenditures DS = Debt Service Expenditures Cap = Capital Expenditures SSA5 = Special Service Area #5 Tax Revenue OR = Other Revenue Vol = Annual Water Billing (gallons) WR= (OP + 6,178,450 DS + Cap - SSA5 - OR )! (141,500) Vol $3.78 o 1,006,710 (1,531,825) 1,457,175 Sewer Rate Formula: SR = (OP + DS + Cap - OR - new rev) ! Vol Where: SR = Sewer Rate OP = Operations Expenditures DS = Debt Service Expenditures Cap = Capital Expenditures OR = Other Revenue Vol = Annual Water Billing (gallons) new rev = Additional revenues to support combined sewer project SR= ( OP + DS + Cap - Proposed Rate Per Expenditure Formula $4.09 $3.78 $4.09 OR - new rev.)! Vol (47,500) (1,000,000) 1,457,175 Sewer Total $0.40 $4.49 $1.37 $5.15 $1.06 $5.15 $ Increase I $0.661 % Increase 14.8% $0.26 $0.26 $1.32 $5.41 $ Increase I $0.921 % Increase 20.5% $1.37 1,615,103 o 1,428,975 Water Total Current Rate (2005) Actual Rate Adjustment Add'l amount for new revenue $0.00 $4.09 Total Proposed Rate (2006) New Revenue (new rev): Customer Service Charge-Sewer $5 per month, per customer ($5 x 12 x 10,469) Additional Sewer Fee (per 1,000 gal) ($.26 x 1,457,175) 628,140 378,866 Total New Revenue 1,007,006 Village of Mount Prospect Water and Sewer Rate Calculation 2007 Budget Year Attachment C2 Water Rate Formula: WR = (OP + DS + Cap - SSA5 - OR) / Vol Where: WR = Water Rate OP = Operations Expenditures DS = Debt Service Expenditures Cap = Capital Expenditures SSA5 = Special Service Area #5 Tax Revenue OR = Other Revenue Vol = Annual Water Billing (gallons) WR= (OP + DS + Cap - SSA5 - OR )/ (141,500) Vol $4.34 6,439,669 o 1,551,475 (1,531,825) 1,457,175 Sewer Rate Formula: SR = (OP + DS + Cap - OR - new rev) / Vol Where: SR = Sewer Rate OP = Operations Expenditures DS = Debt Service Expenditures Cap = Capital Expenditures OR = Other Revenue Vol = Annual Water Billing (gallons) new rev = Additional revenues to support combined sewer project SR= ( OP + 1,678,281 DS + Cap - OR - new rev.)/ Vol $1 .43 o 1,458,500 (47,500) (1,000,000) 1,457,175 Water Sewer Total Total Current Rate (2006) $4.09 $1.32 $5.41 Proposed Rate Per Expenditure Formula $4.34 $1.43 $5.77 Actual Rate Adjustment $4.34 $1 .43 $5.77 Add'l amount for new revenue $0.00 $0.26 $0.26 Total Proposed Rate (2007) $4.34 $1.69 $6.03 $ Increase I $0.621 % Increase 11.5% New Revenue (new rev): Customer Service Charge-Sewer $5 per month, per customer ($5 x 12 x 10,469) Additional Sewer Fee (per 1,000 gal) ($.26 x 1,457,175) 628,140 378,866 Total New Revenue 1,007,006 Village of Mount Prospect Water and Sewer Rate Calculation 2008 Budget Year Attachment C3 Water Rate Formula: WR = (OP + DS + Cap - SSA5 - OR) / Vol Where: WR = Water Rate OP = Operations Expenditures DS = Debt Service Expenditures Cap = Capital Expenditures SSA5 = Special Service Area #5 Tax Revenue OR = Other Revenue Vol = Annual Water Billing (gallons) WR= (OP + 6,721,748 DS + Cap - SSA5 - OR )/ Vol $4.39 o 1,346,968 (1,531,825) (141,500) 1,457,175 Sewer Rate Formula: SR = (OP + DS + Cap - OR - new rev) / Vol Where: SR = Sewer Rate OP = Operations Expenditures DS = Debt Service Expenditures Cap = Capital Expenditures OR = Other Revenue Vol = Annual Water Billing (gallons) new rev = Additional revenues to support combined sewer project SR= (OP + DS + Cap - OR - new rev.)/ Vol $1.42 1,752,321 o 1,358,500 (47,500) (1,000,000) 1,457,175 Water Sewer Total Total Current Rate (2007) $4.34 $1.69 $6.03 Proposed Rate Per Expenditure Formula $4.39 $1 .42 $5.80 Actual Rate Adjustment $4.37 $1.43 $5.80 Add') amount for new revenue $0.00 $0.26 $0.26 Total Proposed Rate (2008) $4.37 $1.69 $6.06 $Increasel $0.031 % Increase 0.5% New Revenue (new rev): Customer Service Charge-Sewer $5 per month, per customer ($5 x 12 x 10,469) Additional Sewer Fee (per 1,000 gal) ($.26 x 1,457,175) 628,140 378,866 Total New Revenue 1,007,006 Village of Mount Prospect Water and Sewer Rate Calculation 2009 Budget Year Attachment C4 Water Rate Formula: WR = (OP + DS + Cap - SSA5 - OR) / Vol Where: WR = Water Rate OP = Operations Expenditures DS = Debt Service Expenditures Cap = Capital Expenditures SSA5 = Special Service Area #5 Tax Revenue OR = Other Revenue Vol = Annual Water Billing (gallons) WR= $4.45 (OP + DS + Cap - SSAS - OR)/ (141,500) Vol 7,018,912 o 1,144,005 (1,531,825) 1,457,175 Sewer Rate Formula: SR = (OP + DS + Cap - OR - new rev) / Vol Where: SR = Sewer Rate OP = Operations Expenditures DS = Debt Service Expenditures Cap = Capital Expenditures OR = Other Revenue Vol = Annual Water Billing (gallons) new rev = Additional revenues to support combined sewer project SR= (OP + DS + Cap - OR - new rev.)/ Vol $1.49 1,830,806 o 1,388,500 (47,500) (1,000,000) 1,457,175 Water Sewer Total Total Current Rate (2008) $4.37 $1.69 $6.06 Proposed Rate Per Expenditure Formula $4.45 $1.49 $5.94 Actual Rate Adjustment $4.45 $1.49 $5.94 Add'l amount for new revenue $0.00 $0.26 $0.26 Total Proposed Rate (2009) $4.45 $1.75 $6.20 $ Increase I $0.141 % Increase 2.3% New Revenue (new rev): Customer Service Charge-Sewer $5 per month, per customer ($5 x 12 x 10,469) Additional Sewer Fee (per 1,000 gal) ($.26 x 1,457,175) 628,140 378,866 Total New Revenue 1,007,006 '~"'=-"'''''''-'--'""",."";~,."""""""""...""=",,,,,\.,,,,,,,.,,,,-=-~==""""~~_""'''''_'''~'~~_'-''''''''''''''''_''>''''_~'"P''_'''''''''''''''''T~'''_'''''''''">'''''''',".,.,,,,_~,,--,,,,,,,,,,,,_..~"""'''o'.''''''-'-'-_~____C~~^'''''''__rn;,,,,,,",,,,,",,=~",,,~~,c__,,~,,~"=""iA"",""";-='~'_''''''''''"""",,,~ Village of Mount Prospect Water and Sewer Rate Calculation 2010 Budget Year Attachment C5 Water Rate Formula: WR = (OP + OS + Cap - SSA5 - OR) I Vol Where: WR = Water Rate OP = Operations Expenditures OS = Debt Service Expenditures Cap = Capital Expenditures SSA5 = Special Service Area #5 Tax Revenue OR = Other Revenue Vol = Annual Water Billing (gallons) WR= (OP + 7,332,220 OS + Cap - SSA5 - OR )1 (141,500) Vol $4.44 o 810,612 (1,531,825) 1,457,175 Sewer Rate Formula: SR = (OP + OS + Cap - OR - new rev) I Vol Where: SR = Sewer Rate OP = Operations Expenditures OS = Debt Service Expenditures Cap = Capital Expenditures OR = Other Revenue Vol = Annual Water Billing (gallons) new rev = Additional revenues to support combined sewer project SR= (OP + OS + Cap - OR - new rev.)1 Vol $1.56 1,914,103 o 1,408,500 (47,500) (1,000,000) 1,457,175 Water Sewer Total Total Current Rate (2009) $4.45 $1.75 $6.20 Proposed Rate Per Expenditure Formula $4.44 $1.56 $6.00 Actual Rate Adjustment $4.45 $1.55 $6.00 Add'l amount for new revenue $0.00 $0.26 $0.26 Total Proposed Rate (2010) $4.45 $1.81 $6.26 $ Increasel $00061 % Increase 1.0% New Revenue (new rev): Customer Service Charge-Sewer $5 per month, per customer ($5 x 12 x 10,469) Additional Sewer Fee (per 1,000 gal) ($.26 x 1,457,175) 628,140 378,866 Total New Revenue 1,007,006 Attachment 0 Village of Mount Prospect, Illinois Water Rate Comparison JAWA Communities, Illinois American Water and Northwest Water Commission Water JAWA Communites Elk Grove Village Hanover Park Hoffman Estates Mount Prospect Rolling Meadows Schaumburg Streamwood $3.22 $3.61 $3.20 $4.09 $3.78 $3.99 $3.47 Sewer $0.45 $1.55 $0.80 $0.40 $1.13 $0.81 $0.66 Northwest Water Commission Arlington Heights $3.68 $0.32 Buffalo Grove $1.80 (1) Wheeling $3.68 $0.32 Palatine (3) (3) Illinois Americn Water Mount Prospect (2) (2) Projected Monthly Future Total SeNice Fee Increase $3.67 $0.00 n/a $5.16 $0.00 n/a $4.00 $0.00 (4) 5.89% $4.49 $0.00 n/a $4.91 $6.30 5.50% $4.80 $5.22 n/a $4.13 $9.00 5.00% $4.00 $5.20 n/a $1.80 $0.00 n/a $4.00 $0.00 n/a (3) (3) n/a $7.30 $0.00 n/a High Mount Prospect-Illinois American Water $7.30 Low Elk Grove $3.67 Average All Communities (excl. Buffalo Grove) $4.47 Notes: (1) Cook County Residents, included in taxes. Lake County Residents, $14.50 per month fIat fee. (2) The Illinois American water rate is made up of multiple fees. Basic service water charge $0.52 Water use charge $3.51 Supply charge $1.36 Sewer charge $0.66 Fire protection charge $1.01 State recovery tax $0.24 Total $7.30 (3) Unable to determine. Multiple rate schedules for incorporated versus unicorporated. Also billed use varies by gallons and cubic feet. (4) Four-year average - 2006 through 2009 Mount Prospect Director Glen R. Andler ~ Deputy Director Sean P. Dorsey Mount Prospect Public Works Department 1700 W. Central Road, Mount Prospect, Illinois 60056-2229 NDTICE THE AUGUST B, 2[][]S MEETING OF" THE SAF"ETY COMMISSION HAS BEEN CANCELLED. THE NEXT REGULAR MEETING IS SCHEDULED F"OR MONDAY, SEPTEMBER 12TH AT 7:[][] P.M. AN AGENDA DR CANCELLATION NOTICE WILL BE SENT PRIOR TO THIS MEETING. DATED THIS 1 ST DAY OF" AUGUST, zoos. Phone 847/870-5640 Fax 847/253-9377 www.mountprospect.org