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HomeMy WebLinkAbout0420_001Minutes COMMITTEE OF THE WHOLE November 12, 1991 Roll Call The meeting was called to order at 7:38 p.m. by Mayor Gerald L Farley. Trustees present were Mark Busse, George Clowes, Tim Corcoran, Leo Floros, and Paul Hoefert. Also present were Village Manager John F. Dixon, Communications Administrator Cheryl Pasalic, Assistant Finance Director Carol Widmer and Finance Director David C. Jepson. Additionally, Robin Charleston, legal counsel, three members of the news media and about 15 Village residents were in attendance. Trustee Irvana Wilks arrived at 9:55 p.m. Mayor Farley requested that all persons present observe a period of silence in memory of the two teenagers who were killed in an auto accident. Mayor Farley expressed sympathy to the families and friends of these two youngsters and to the others involved in the accident. II Minutes The Committee of the Whole Minutes of October 8, 1991 were accepted and filed. PROMM No citizens expressed a desire to appear before the Committee. Mayor Farley made an announcement on behalf of the 75th Anniversary Committee that approximately 600 out of the 800 tickets available for the anniversary banquet had been sold. 001111FI-PITTIV MIMINIETTEPT-10212112-11 Mark Broscio, spokesperson for the River Trails Community Association (RTCA), was joined by Joanne McCoffin, Janice Zemaitis, Emily Novak and Don Craig of RTCA to request the Village Board to support citizens of Mount Prospect who are opposed to the widening of Euclid Avenue. Mr. Broscio said that RTCA had obtained over 1,000 signatures on petitions that were presented to the Cook County Board in opposition to the project. He said they were currently waiting for the Cook County Board to hold a public hearing on the project. The group presented four primary reasons why they opposed the project: 1. They were concerned about the safety of their children if the project would be completed. They stated that cars would travel faster, the roadway would be 6 feet closer to the sidewalks and they would need to cross five lanes of traffic. 2. They were concerned about the noise level and dirt and dust from the traffic. 3. They were concerned that home values would decrease. They said that they had been told by real estate dealers that their home values could decrease by as much as $10,000. 4. They were concerned that the character of the neighborhood would change. They also mentioned that the area would be impacted by the long construction period. During the presentation, the representatives of RTCA presented a video showing existing traffic on Euclid Avenue and an `audio cassette of current noise levels. The members of RTCA also mentioned that the Village of Arlington Heights did not allow the County to proceed as planned for the portion of Euclid Avenue in Arlington Heights. They also stated that the Village Boards of Glenview and Wilmette had gone on record as being opposed to the project. They requested that the Mount Prospect Village Board reconsider 'their previous position and help them to defeat the project. Mayor Farley stated that the Village Board must consider the needs of the entire Village when a controversial project is under consideration. He said that in his opinion he thought it was in the best interest of the entire Village for the County to proceed with this project. He added that the goal of the improvement was to promote efficiency in traffic movement and safety. He said the motorists as well as the residents should be considered. In regard to the Glenview and Wilmette actions, Mayor Farley said that the circumstances were different than in Mount Prospect. Mayor Farley said the Village would work with RTCA to reduce speed limits on Euclid Avenue. Trustee Busse stated that he continued to support the residents in this area of the Village and he encouraged the Village Board to go on record and support the residents. He said he did not think this situation was any different than the concerns expressed by the residents of Maple Street. He added that he did I not see how widening Euclid Avenue would improve safety. # NONNI the improvement wou benefit residents of other communities more tuall Euc 1—KC1 4t Mount Prospect. Trustee Corcoran stated that he would like to see some middle ground. Specifically he said he would like to see turn lanes at all controlled intersections, no left turns during peak hours, reduced speed limits, and to encourage the County to widen Willow. Trustee Corcoran 2 encouraged the members of the RTCA to discuss these issues with their members and bring back some alternatives to the Village Board. Trustee Clowes said that he supported the project but that he also thought the speed should be reduced to 35 mp.h. He stated that Euclid Avenue is an arterial road and we should 'expect traffic to increase. Trustee Clowes said he would like information on the number and kinds of accidents that have occurred on Euclid Avenue. Trustee Floros stated that he appreciated the position and the concern of the RTCA and that he thought all parties were concerned with safety, including the County. He said that the issues were different in Glenview and Wilmette. He said he supported the project but that he would support lowering the speed limit as soon as possible. He added that he also supported trying to come up with alternate solutions if possible. Mayor Farley ended the discussion by saying that there was a consensus to try to minimize the impact of the project as much as possible. 57-T"JR7#fi#TA7trt"!= Communications Administrator Cheryl Pasalic explained that performance evaluations are required to check the progress and act as a report card on bow the cable company is doing. The process includes public input, obtaining various reports from the company, and information from special hearings which are then evaluated by Village Staff and Advisors. Ms. Pasalic commented that complaints are down and a better working relationship exists with the present staff of Telenois. Ms. Pasalic stated that there were several areas where Telenois has not complied with terms of the franchise agreement. She said they objected to complying with the Village's Cable Communication Code due to the fact that it was amended in 1989. Other unresolved issues include the following: access to the Mount Prospect studio has been denied and no studio workshops have been held at the Mount Prospect Studio. No clear time frame has been outlined as to when and what access equipment upgrades will take place. The interconnect of at least 20 channels has not been completed. A change of ownership had taken place and Telenois did not properly notify the Village. Financial information provided to the Village was not adequate. And finally, that different fees were being charged to some commercial establishments. Kelvin Fee, general manager of Telenois, responded to some of the issues that were raised. Mr. Fee stated that he had offered the use of the studio to Cheryl Pasalic twice a month, but that it was not generally available for residents because the equipment was. more sophisticated than in other studios. A number of the schools use the interconnect but that they do not get many requests for this type of use. In regard to the transfer of ownership he said it was an intercompany transfer and that they had provided an affidavit of the transfer. Mr. Fee said that the company had put in fibre cable in the areas where they thought it would improve picture quality, and that it had not been their intention to upgrade the entire system. He added that they do have plans to upgrade the entire system over the next five years. During the discussions that followed, the Committee requested clarification of some of the issues from Ms. Pasalic and Mr. Fee. Trustee Corcoran recommended that a 60 day moratorium be placed on any action to compel Telenois to come into compliance with the issues that had been discussed. He asked specifically that the availability of citizen workshops, access to the studio and the favored nations clause of the agreement be addressed. There was a consensus of the entire Committee to support this recommendation. Finance Director David Jepson reviewed the budget process with the Committee and explained than an important part of the process is the six-month budget review. He stated that during; the past several weeks every line item in the current budget has been reviewed, and based on the experience of the first six months ;and other known factors, estimates have been made for the entire year. These estimates were compiled and summarized and then reported in the following financial schedules: 1) Estimated Revenues By Fund; 2) Estimated Expenditures by Fund; ) ,Estimated Available Fund Balances; and 4) Estimated Revenues and Expenditures of the General Fund, Mr. Jepson then reviewed highlights of the budget information with the Committee. He reported that total revenues are expected to be $45,628,870, some $2,606,140 more than had been expected. Mr. Jepson explained that much of this increase was in the Capital Projects Funds and was primarily dun to the sale of a greater amount of bonds than originally had been budgeted. Other significant increases occurred because of the extension of the State Income Tax Surcharge. The extension of the Surtax expected to result in additional revenue of $600,000 in the Capital Improvement Fund and $275,000 in the General Fund. Other increases are expected in the Water Fund, the Risk Management Fund and the Pension Funds. In regard to expenditures, Mr. Jepson reported that total expenditures are expected to be $39,491,225, d $1.,107,495 from the amount budgeted. Capital Projects are estimated to he down $1,634,590, primarily because of changes in project schedules. Mr. Jepson explained. that any amounts not expended in the current fiscal year will be re -budgeted next year. Increases were shown in the General Fund, the Water Fund and the Risk Management Fund. The increase in the General Fund is expected because of higher medical 'insurance costs and higher overtime costs in the Police and Fire Departments. The .increase in the Water Fund is due to additional water purchases and the increased cost of a water main project. And the increase in the Risk Management Fund is due to higher medical claims and workers' compensation claims. Mr. Jepson stated that the fund balance in the General Fund at the end of the year should be $2.9 million, which represents about 16% of estimated expenditures. This is slightly higher than what had been anticipated. The balances in Motor Fuel Tax. Fund and the Water Fund are expected to be at the anticipated levels. Mr. Jepson stated that the fund balance of the Capital Improvement Fund should be about $600,000 more than expected because of the State Income Tax Surcharge. Mr. Jepson concluded by staging that the Village has been affected by the downturn in the economy, but that due to the conservative policies of the Village Board the Village will come through this fiscal year better than a number of other governmental entities. During the discussion that followed„ "Trustee Busse asked what would have been the effect on the budget if the State income Surtax had not been extended and we would not have had additional water sales. Mr. Jepson replied that the General Fund revenues would be reduced by $275,100 and the Capital Improvement Fund by $600,000. Instead of a surplus of $83,000 in the General Fund there would have been a deficit of $192,000. Mr. Jepson also responded that the City of Chicago raised their rate to JAW.A by 6% in September 1991 and they planned to raise it another 4% in January 1992. If additional water revenue had not been received in 91/92 it would have required a higher water rate increase in 92/93 than the 5% that had originally been expected. Trustee Busse also asked why the Police and Fire overtime costs were going up. Mr. Jepson responded that part of the reason for the Police overtime is the agreed upon payment of 3 hours overtime whenever a police officer goes to court. In regard to the Fire overtime, Mr. Jepson stated that two firefighters were not available for shift duties because of disability. Trustee Busse asked for more definitive reasons for the increase ift overtime from the two chiefs. Trustee Busse also said he would like the Village Board to reconsider the Flood Control Rebate Program. Because expenditures have been considerably less than expected in this program, he asked that residents who completed these types of projects prior to May 1, 1991 be considered for eligibility. Trustee Wilks asked if any progress had been made on addressing medical insurance costs. Village Manager Dixon responded that all bargaining groups are contributing at least 10% and other avenues are being discussed to try to reduce costs. Finance Director Jepson stated that the proposed 1991 tax levy of $7,339,160 for Village purposes is the same amount that was included in the 91/92 budget, and represents a 4% increase over the 1990 amount, The ;Library levy request is $2,279,915 and represents an increase of S% over the 1990 levy fair Library purposes. The total proposed levy for the Village and the Library is $9,619,075. The total 1991 levy represents a 4.9% increase over the 1990 levy. Mr. Jepson reported that the Village will need to hold a public hearing and publish a Truth In Taxation notice because when debt service is excluded, the 1991 levy is 6.5% higher than the 1990 levy. He stated that the Village Board would need to pass a resolution on November 19, 1991, present the tax levy ordinance for a first reading on December 3, 1991, publish the notice for the public hearing on December 4, 1991, and then hold the public hearing and act on the ordinance on December 17, 1991. Trustee Clowes proposed that because the Village will be receiving State Income Tax and Surtax monies that had not been anticipated, that the 1991 levy be reduced to the 1990 level. He said that the Village of Mount Prospect would be taking a leadership role and setting an example to other taxing bodies. Village Manager Dixon responded that if a tax levy is reduced in one year, it usually causes a much greater percentage increase in subsequent years because of the compounding effect. Trustee Floros asked how much we would need to reduce the 1991 levy to keep it the same as the 1990 levy. Mr. Jepson responded that the proposed 1991 levy would need to be reduced by about $280,000. Tmstee corcoran stated that he would Re to see more information before he made a decision. He requested that some schedules be prepared showing different alternatives and wbat the effect would be on a longer-term basis. The Village Manager did not have anything to report. IX AM Other Business There was no other business brought before the Committee. X A&s—rrm= There being no other business the meeting adjourned at 11:45 p.m. Respectfully submitted, David C. Jepson, Finance Director 6 Village of Mount Prospect Mount Prospect, Illinois INTEROFFICE MEMORANDUM TO: John Fulton Dixon, Village Manager FROM: David C. Jepson, Finance Director', . DATE: November 21, 1991 SUBJECT: Property Tax Levy Requirements and General Fund Revenues and Expenditures During the 1991/92 budget work sessions, the Village Board established a directive to limit the increase in the 1991 tax levy to 4%. This action is consistent with the position that was taken in 1989 when the increase was 6.5% and in 1990 when the increase was 3.9%. Subsequently, at the Committee of the Whole meeting on November 12, 1991 Trustee Clowes asked the Village Board to consider eliminating the increase for 1991 because the Village will be receiving State Income Surcharge receipts that were not anticipated when the 91/92 budget was prepared. Additionally, Trustee Corcoran requested some additional information which would show the effects of reducing the 1991 tax levy on future years' tax levies. Because property taxes are only one source of the revenues that are used to finance Village services, I have prepared several schedules which show the relationship of property taxes to General Fund revenues and expenditures on a historical basis and on a prospective basis. Specifically, there are four schedules attached which should not only help to identify future property tax requirements, but which also should help to establish future budget policies. The schedules included are: 1. Summary of Tax Levies 1985, 1986-1990, and 1991-1995. 2. General Fund Revenue and Expenditure Summary 86/87, 87/88-91/92, and 92/93- 96/97. 3. General Fund Revenues 86/87, 87/88-91/92, and 92/93-96/97. 4. General Fund Expenditures 86/87, 87/88-91/92, and 92/93-96/97. Each of the schedules is organized to show a base year and then two five-year periods along with the percentage changes over these periods. The first five-year period represents the most recent five-year period ending with the current fiscal year (91/92) and the second five-year period represents projections for the next five years starting with the 92/93 fiscal year. The purpose of the schedules is to show the relationship of property tax levies to other revenue sources and total General Fund revenues to total General Fund expenditures. John Fulton Dixon November 21, 1991 Property Tax Levy Requirements and General Fund Revenues and Expenditures In developing projections for the next five years, it is necessary to make certain assumptions. I recognize that assumptions are only our best guesses and that actual results will be subject to'a number of influences. I fully expect that these amounts will change, especially at the farther end of the range. Nevertheless, I believe the projections are reasonable and they were made in keeping with the spirit of placing some limits on revenue and expenditure growth. In that light they can provide a picture of what to expect over the next five years. The tax levy amounts shown in Schedule 1 are integrated into the General Fund revenue amounts in Schedule 3, and then the revenues from Schedule 3 and the expenditures from Schedule 4 are summarized and combined in Schedule 2. Schedule 1 shows that tax levies increased a total of 52.1% during the previous five-year period. The increases for 1986-1988 ranged from 10% to 13%, whereas the increases for 1989 and 1990 were 6.5% and 3.9% respectively. The total increase for the next five-year period (1991-1995) is projected to be 27.9%. The largest increase (9.1%) is scheduled for 1992 and is due to the increase in debt service requirements for the Police and Fire Building bond issue. Schedule 2 shows that revenues exceeded expenditures in four out of the last five fiscal years. However, deficiencies are expected in each of the next five fiscal years with the expected shortfall exceeding $1 million in 96/97. Schedule 3 presents more detailed information on revenue sources of the General Fund and Schedule 4 includes expenditures for the General Fund departments and divisions. Following is a brief discussion of the information contained in the four schedules: This schedule shows the actual tax levy amounts for the various purposes for which taxes were levied for 1985-1990, the proposed levy amounts for 1991, and projected amounts for 1992-1995. The schedule is set up with 1985 as a base year and then with two five-year periods, 1986-1990 and 1991-1995. Using this format the percentage changes for the two five-year periods can be compared. The period of 1986-1990 covers the last five actual tax levies and the period of 1991- 1995 covers the current levy under consideration (1991) and then the next four years. The schedule also shows the annual percentage increase from year to year and two alternatives to the 1991 tax levy as proposed. The purpose of this type of format is to show trends over the two five-year periods. Village tax levies increased a total of 52.1% over the five-year period of 1986-1990 for an annual rate of increase of about 8.75%. During this same period, the total General Corporate levy increased 48.4%, or 8.25% annually. The increases for the other purposes ranged from 22.5% for Debt Service to 49.5% for Pensions. Tax levy projections for 1991-1995 show much more modest increases and have been determined in the following manner: 2 John Fulton Dixon November 21, 1991 Property Tax Levy Requirements and General Fund Revenues and Expenditures 1. When considering the proposed tax levy, the first priority is for Debt Service requirements. The actual amounts needed for General Obligation Bond principal and interest payments for the period covered by the tax levy, less any uncommitted cash balances, are determined. Then a loss,and cost factor of 5% is added to this amount to establish the actual levy requirement. 2. The second priority is for Pension commitments. The IMRF levy includes both FICA contributions and IMRF pension contributions. A 5% factor for annual salary increases plus a 5% factor for 1991 and 1992 and a 1% factor for 1993-1995 for expected rate increases have been included. The levies for Police and Fire Pensions are each estimated to increase $12,875 per year. This is strictly an estimated amount and will be revised annually when the annual actuarial reports are available. It should be pointed out that because of the level of funding achieved, only $51,500 was levied for Fire Pension purposes from 1985-1990. 3. The next priority is for Refuse Disposal requirements. The total amount of revenue from refuse disposal fees are estimated and then this amount is subtracted from expected expenditures to arrive at the tax levy requirement. A 5% annual increase has been used for the five-year period of 1991-1995. 4. The tax levies for Capital Improvements and General Corporate purposes are then determined. In prior years these amounts were established after considering other available revenue sources such as sales taxes, state income taxes, permit fees, etc. For the five-year period of 1991-1995, a 5% annual factor has been included. All levy amounts except debt service include a loss and cost factor of 3%. The total increase for the five-year period of 1991-1995 is 27.9% for an annual rate of increase of just over 5%. The portion for Debt Service shows a total increase of only 2% and reflects the final levy for the 1973 G.O. Bonds in 1993 and the final levy for the 1974 G.O. Bonds in 1994. The levies for Pensions show the greatest increase, totaling 62.4% or 10.1% per year. The higher than normal increase for Pensions is because the levies for Police and Fire in the 1990 base year were lower than normal. It should be mentioned that the expected percentage increase of 9.1% for 1992 reflects the additional debt service required for the new Police and Fire Building. The additional $300,000 included in the levy for this purpose represents an expected tax rate increase of 3.94¢. An increased tax rate of 3.94¢ equals a $9.85 tax increase for a home with an EAV of $25,000. This rate increase will be reduced in 1995 to its previous level and is consistent with the information presented during the 1991 referendum. This schedule also shows two alternatives to the 1991 tax levy of $7,339,160 as proposed. The first alternative is shown at the bottom left portion of the schedule and assumes no increase for the 1991 tax levy from the 1990 levy of $7,057,532. If the 1991 levy is the same as 1990 and if the 1992 John Fulton Dixon November 21, 1991 Property Tax Levy Requirements and General Fund Revenues and Expenditures levy remains at the projected amount of $8,004,150, the effect of the reduction in 1991 results in a 13.4% increase in 1992. This compares with a previous estimated percentage increase of 9.1%. In an attempt to reduce the impact of the percentage increase for 1992, a second alternative was developed and is presented in the lower right. In the second alternative, there is a reduction in the proposed tax levy in 1992 as well as 1991. Along with the reduction of $281,628 for 1991, an additional reduction of $304,150 is shown for 1992. The effect of this change reduces the percentage increase in 1992 to 9.1%, the same as originally expected; however, the increase for 1993 goes up from 4.7% to 8.9%. In order to reduce the percentage increases for 1993 and 1994 to the previous levels of 4.7% and 5.6%, additional reductions of $320,200 in 1993 and $336,300 in 1994 would be needed. With these additional reductions in 1993 and 1994, the percentage increase for 1995 would still go up to 6%. These alternatives show the compounding effect of the percentage increases in future levies when a tax levy is reduced. ;chedule 2 - General Fund Revenue and Expenditure Summ Schedules 2, 3, and 4 are identical in format and are similar to the format of Schedule 1, except that Schedule 1 uses calendar years and Schedules 2, 3, & 4 use the Village's fiscal years. In the last three schedules, the 86/87 fiscal year is used as a base year along with the two five-year periods of 87/88 through 91/92 and 92/93 through 96/97. The purpose of this type of organization is to provide a basis for a trend analysis of the two five-year periods. The first five-year period includes actual amounts for 87/88 - 90/91 and estimated amounts for 91/92. The second five- year period contains projected amounts based upon various assumptions. Schedule 2 is a summary of the revenue categories included in Schedule 3 and the departmental expenditures included in Schedule 4. Schedule 2 also includes the excess or <deficiency> of revenues over expenditures for each year. The schedule shows that during the first five-year period Operating Revenues increased 47.3% and All Revenues increased 41.6%. On the expenditure side, Total Expenditures increased 46.8%, for an annual average of about 8%. For the second five-year period, revenues are expected to go up 20.7% and expenditures 26.8%. The annual increase for expenditures during the second five-year period is about 4.9%. One of the trends that can be seen from this comparison is that both revenues and expenditures are expected to grow at a significantly slower rate over the second five-year period. Revenues are expected to increase 20.7% compared to a 41.6% rate the first five years. Expenditures are expected to increase 26.8% compared to 46.8%. The dilemma that becomes evident is that expenditures at the end of the second five-year period are 6.1% greater than revenues when compared to the 91/92 base year. For the 96/97 fiscal year, expenditures are actually 4.6% greater than revenues. When expressed in actual dollar amounts, expenditures are expected to exceed revenues in 96/97 by $1,010,900. John Fulton Dixon November 21, 1991 Property Tax Levy Requirements and General Fund Revenues and Expenditures The assumptions used for the revenue projections during 92/93-96/97 include an annual increase of 5% for Property Taxes, 4% for Sales Tax and 4% for State Income Tax. Other Taxes which includes the Real Estate Transfer Tax and the Food and Beverage Tax are expected to grow by less than 3% and the growth in Intergovernmental Revenues is expected to be less than 2%. The assumptions for the expenditure projection include a 6% general increase in 92/93 and 5% increases for 93/94-96/97. The 6% figure was used for 92/93 because personal services and other costs are expected to increase 5% and the increase in medical benefits will account for another 1%. It should be pointed out that the expenditure amounts for the Streets and Public Property category during the next five years do not include any amounts for street resurfacing. This explains why their five-year increase is shown as 13.0%. It is being assumed that the Street Resurfacing Program will be funded by sources other than the General Fund. Also, I believe it is very optimistic to expect that expenditures for 93/94 - 96/97 can be kept in the 5% range, but based on the revenue picture it appears that some serious measures will need to be taken. There are other trends that can be observed but these will be addressed in the next two sections. chedule 3 - Gerseral Fund Revenues This schedule follows the same format as Schedule 2 and shows the various revenue categories and groupings of the General Fund, The purpose of this format is to identify trends by comparing the next five-year period with the most recent five-year period. Overall totals were discussed under Schedule 2 and some of the specific revenues will be considered in this section. The most striking percentage change in the revenue categories shows Other Taxes up over 2,500% in the first five-year period compared to an increase of only 15.2% in the second five-year period. The reason is because the Village added the Food and Beverage Tax and the Real Estate Transfer Tax in 1987, then increased the Real Estate Transfer Tax in 1990, and added a Hotel/Motel Tax in 1991. These three taxes are responsible for an increase of $1,050,000 during the first five-year period compared to an expected increase of $134,200 during the second five-year period. The Real Estate Transfer Tax is assumed to increase at a 4% level and the Food and Beverage Tax at a 2% level. It should be mentioned that one of the reasons for adopting these taxes was to broaden the Village's revenue base and to reduce the reliance on property taxes. This is at least part of the reason the double-digit tax levy increases in 1986-1988 could be reduced in 1989 and 1990. There was also a significant increase in the State Income Tax in the first five-year period and a much smaller increase expected during the second five-year period. Because 50% of the 1/2% State Income Tax Surcharge is temporary, the projections do not assume the temporary portion will extend beyond June 30, 1993. If the temporary portion is made permanent in 1993 or John Fulton Dixon November 21, 1991 Property Tax Levy Requirements and General Fund Revenues and Expenditures extended at the same level, it would produce an estimated $165,000 additional revenue in 96/97. Under these circumstances, the five-year increase for Intergovernmental Revenue would be 16% rather than 9.5%. Under the Refuse Disposal Revenues category, Property Tax is expected to go up 5% and Refuse Disposal Charges 8% the first two years and 6% the last three years. Because Vehicle Licenses have not been increased since 1986 (effective 5/1/87) I assumed a 50% increase effective 5/1/94. The increase for a passenger vehicle would go up from $20 to $30. This change would generate approximately $350,000 and is included in the total for 94/95 - 96/97. No other increases are expected in the Licenses, Permits, Fees category. Also, because of the peak levels of activity in 88/89 - 90/91 and the limited land space for new building projects, I have assumed that permit related revenues will not increase over this five-year period. For the period of 92/93 - 96/97, Property Taxes for General Corporate purposes are assumed to increase 5% and Sales Tax 4%. Property tax amounts are taken from the projected amounts in Schedule 1 with an assumed collection rate of 99%. 1 believe that a 4% increase in Sales Tax is an optimistic projection when considering that the prior five-year period included increased revenues due to expansions at Randhurst and Mount Prospect Plaza and most of the increase for the Wal-Mart Store. Other revenues are generally assumed to increase 4% to 5% annually. hedule 4 - General Fund ...Extten%tuu This schedule is presented in the same format as Schedules 2 and 3. Actual figures for the 86/87 fiscal year serve as a base period and the next ten years are broken down into two five-year periods. Actual expenditures are presented for 86/87 - 90/91, estimated expenditures for 91/92 and then projected amounts for 92/93 - 96/97. The projections for 92/93 include a general increase of 6% and the next four years assume a general increase of 5%. During the first five-year period, Total Expenditures went up 46.8% or at an annual rate of about 8%. There are extraordinary increases in 89/90 and 90/91 (see Resurfacing 'and Special Projects under Streets and Public Property) and if either of these years would have been the end of the comparison period, it would have distorted the percentage increases. However, because 91/92 is the end of the five-year period and because there are no extraordinary expenditures in 91/92, it appears that the percentage increases are reasonable. In comparison to the total increase of 46.8% for the first five-year period, it is projected that total expenditures in the second five-year period will be 20.8%. Whereas the annual increase in the first five-year period was 8%, it is being projected that the annual increase in the second five-year period will be 4.9%. As I mentioned earlier, this may be a difficult goal to achieve, but, when measured by current revenue sources, it may be still too high a level of expenditures. NMI John Fulton Dixon November 21, 1991 Property Tax Levy Requirements and General Fund Revenues and Expenditures In regard to the functional areas, the greatest percentage increase is for Civic Groups at 164.0%. This is somewhat distorted because of an additional $20,000 allocated to the 75th Anniversary Committee in 91/92 and because some of the base year (86/87) was funded by Revenue Sharing Funds rather than the General Fund. The most significant increase is for Refuse Disposal with a five-year increase of almost 100%. The increase represents $1.2 million more in expenditures in 91/92 than in the base year of 86/87. It is expected that the increases in these costs will moderate during the next five-year period with a total increase projected at 33.6%. Public Safety and Streets, which combined make up approximately 2/3 of the total General Fund, each show increases of about 40%, or 7% annually. Other significant increases show up in Inspection Services and Human Services. These increases can be attributed to increased personnel and expanded services. For the second five-year period, all of the increases are relatively uniform except for Streets and Refuse Disposal. The Streets total at 13.0% is down because no provisions for resurfacing have been included in these projections. The resurfacing amounts were excluded from the projections because of the expected deficiency in revenues. It should be mentioned that when the Streets Division for 96/97 is compared to 91/92 the increase is the same as for the other Operating Departments at 28.8%. The increase in Refuse Disposal includes 8% increases during the first two years and 6% during the last three years. Conclusion As I mentioned earlier, projections of necessity are based on assumptions, and the actual results are expected to be somewhat different than the projections. However, I believe the trend that shows revenues are not keeping pace with expenditures is accurate. Increases for operating expenditures generally grow at a consistent level regardless of the economy, whereas revenue sources are dependent not only on the economy but also on policies regarding increases in rates and fees. Based on my observations, I do not believe existing Village revenue sources will continue to support the existing level of Village services over the next five years. The solution to this dilemma seems to be that either revenue sources will need to be increased and/or expanded and that expenditures must be reduced in some areas and more stringently controlled than when surpluses were being realized. Under these circumstances, I would not recommend a reduction in the proposed 1991 tax levy. Additionally, I would suggest that this information be discussed with the Village Board so that their input can be incorporated into the upcoming budget process. DCJ/sm Enclosures Schedule 1 VILLAGE OF MOUNT PROSPECT Summary of Tax Levies 1985, 1986-1990, and 1991-1995 x x 1985 1986 1987 1988 1989 1990 Change 1991 1992 1993 1994 1995 Change Actual Actual Actual Actual Actual Actual 5 Yrs Proposed Projected Projected Projected Projected 5 Yrs General Corporate f 2,255,700 $ 2,600,750 S 2,806,750 S 3,112,660 $ 3,141,500 S 3,347,500 48.4% S 3,514,875 $ 3,690,600 S 3,875,150 S 4,068,900 $ 4,272,350 27.6% Refuse Disposal S 1,220,550 S 1,236,000 S 1,467,750 S 1,467,750 S 1,689,200 $ 1,751,000 43.5% $ 1,838,550 S 1,930,475 S 2,027,000 S 2,138,350 S 2,234,775 27.6% Capital lmprovements S 309,000 $ 309,000 $ 412,000 $ 412,000 S 412,000 S 412,000 33.3% S 412,000 S 432,600 $ 454,250 S 476,950 $ 500,800 21.6% General Obligation Bonds Village S 108,562 S 389,695 S 652,211 $ 601,598 S 601,598 $ 599,180 S 518,017 S 819,965 S 819,965 $ 901,350 $ 831,650 Library 258,0$6 248.498 238-910 223.469 223,469 216.552 205,968 177,760 177,760 168 000 - Totals S 366,648 S 638,193 $ 610,092 S 875,680 S 825,067 $ 815,732 22.5% S 723,985 $ 997,725 S 997,725 S 1,069,350 S 831,650 2.0% Pensions IMRF $ 283,250 S 329,600 S 401,700 S 461,440 S 571,650 S 679,800 $ 746,750 S 824,000 S 873,450 S 925,850 S 981,400 Police Pension 206,000 128,750 103,000 51,500 103,000 51,500 77,250 90,125 103,000 115,875 128,750 Fire Pension - - - 51,500 25.750 38,625 51.500 64,375 77.250 Totals S 489,250 S 458,350 $ 504,700 S 512,940 S 726,150 S 731,300 49.5% $ 849,750 S 952,750 S 1,027,950 S 1,106,100 $ 1,187,400 62.4% Total Village bevies S 4,641,148 $ 5.242,293 $ 5,801,292 S 6,381,030 _S_6.7_93_,_91 7 _$_7.,0_5_7,_5.3_2 52.1% 5 7,339,160 $ 8.004,150 S 8,382,075 S 8,859,650 S 9,026,975 27.9% Annual Percentage Increase - 13.0% 10.7% 10.0% 6.5% 3.9% 4.0% 9.1% 4.7% 5.6% 2.0% Alternate 1991 Tax lave Alternate 1991 A 1992 Tax Levies Proposed Proiected Projected Projected Projected Proposed Projected Praiected Projected Projected Proposed/Projected 1991-1995 Levies S 7,339,160 S 8,004,150 $ 8,382,075 S 8,849,650 S 9,026,975 S 7,339,160 $ 8,004,150 S 8,382,075 S 8,849,650 S 9,026,475 Reductions < 281,628> < 281 628> < 304.150> Alternate Tax Levies S 7.057,532 S 8,004,150 S 8,382,075 S 8,849,650 S 9.026,975 S 7.057,532 $ 7.700.000 18,382,075 S 8,849.650 % 9.026,975 Annual Percentage Increase 0% 13.4% 4.7% 5.6% 2.0% 0% 9.1% 8,9% 5.6% 2.0% Schedule -2 VILLAGE OF MOUNT PROSPECT General Fund Revenue and Expenditure Summary 86/87, 87/88-91/92, and 92/93-96/97 86/87 87/88 88/89 89/90 90/91 91/92 Change 92/93 93/94 94/95 95/96 96/97 change Actual Actual Actual Actual Actual Estimated 5 Yrs Projected Projected Profected P�oiected Projected 5 Yrs Revenues Property Taxes - General $ 2,342,094 S 2,746,305 S 2,843,886 S 3,220,047 S 3,191,826 S 3,366,900 43.8% S 3,479,750 S 3,653,700 $ 3,836,400 S 4,028,200 $ 4,229,600 25.6% Sates Tax 4,554,178 4,613,220 5,244,415 5,782,413 5,897,182 5,925,000 30.1% 6,120,000 6,364,800 6,619,400 6,884,200 7,159,500 20.8% Other Taxes 40,949 343,145 828,161 800,408 986,921 1,092,000 2566.7% 1,124,200 1,156,200 1,189,200 1,223,200 1,258,400 15., . Intergovernmentat Revenue 1,538,323 1,610,019 1,797,227 2,043,551 2,384,958 2,540,675 65.2% 2,557,600 2,473,700 2,572,500 2,675,100 2,781,700 9.5% Refuse Disposal Revenues 1,197,717 1,363,715 1,423,207 1,674,647 2,052,110 2,271,100 89.6% 2,562,450 2,712,800 2,856,400 3,007,800 3,167,100 39.5% Other Revenues 2,597,172 2,706,189 3 064 066 3,254.742 3,208,417 2,884,275 11.1% 2 991 150 3,0%250 3.452,400 3,498.700 3,547,300 23.0% Total Operating Revenues $12,270,433 $13,382,593 $15,200,962 416,775,808 S17,721,414 $18,079,950 47.3% $18,835,150 819,419,450 520,526,300 $21,317,200 $22,143,600 22.5% One -Time Reimbursements 690,526 388,205 78.063 179.038 404.285 266.950 < 61.3>% 100,000 X Totals - All Revenues $12,960,959 $13,770,798 $15,279,025 S16,954,846 $18,125,699 $18,346,900 41.6% $18,935,150 $19,419,450 $20,526,300 521,317,200 S22,143,600 20.7% Exoeriditures General Government S 636,898 S 679,027 S 739;944 S 702,105 S 854,200 S 838,300 31.6% S 885,150 $ 926,800 S 970,500 S 1,016,300 S 1,064,400 27.0% Finance Department 642,472 685,637 703,044 757,011 788,465 853,220 32.8% 904,400 949,650 997,100 1,046,950 1,099,300 28.8% Inspection Services Dept. 555,902 579,061 683,142 761,612 828,891 881,420 58.6% 934,300 981,000 1,030,050 1,081,600 1,135,650 't Public Safety 6,922,185 7,178,054 7,747,977 8,583,603 8,967,725 9,691,735 40.0% 10,273,200 10,786,900 11,326,250 11,892,550 12,487,150 28.8% Human services Division 186,724 206,658 235,638 250,046 279,713 318,820 70.7% 337,950 354,850 372,600 391,200 410,800 28.8% Planning & Zoning Dept. 207,109 229,718 245,502 242,120 261,378 285,035 37.6% 302,150 317,250 333,100 349,750 367,250 28.8% Streets & Public Property 2,032,884 2,183,508 2,667,812 3,959,690 3,570,153 2,841,485 39.8% 2,640,950 2,773,000 2,911,650 3,057,250 3,210,100 13.0% Refuse Disposal 1,200,511 1,396,276 1,478,389 1,852,851 2,116,302 2,396,850 99.7% 2,538,000 2,741,000 2,905,500 3,050,700 3,203,300 33.6% Civic Groups & Misc 59.485 118.003 109 067 112.761 130.234 157,020 164.0% 145,250 152,500 160,150 168,150 176,550 12.4% Total Expenditures $12,444,170 $13,255,942 $14,610,515 517,221,799 $17,797,061 $18,263,885 46.8% 518,961,350 $19,982,950 $21,006,900 $22,054,450 $23,154,500 26.8% Excess or meficiency> Revenues $ 514,856 S 668,510 S< ?66,953> % 328,638 S 83,015 S< 26.200> $< 563.500> S< 480.600> S< 737.250> 1<1,010,900> over Expenditures S 516,789 VILLAGE OF MOUNT PROSPECT General Fund Revenues 86/87, 87/88-91/92, and 92/93-96/97 Schedule 3 x 92/93 93/94 94/95 95/96 46/97 change Projected Proiected Projected Proie-i Proiected 5 Yrs S 3,479,750 S 3,653,700 S 3,836,400 $ 4,028,200 S 4,229,600 25.6% $ 6,120,000 S 6,364,800 S 6,619,400 $ 6,884,200 S 7,159,500 Other Taxes R. E. Transfer Tax S $ 54,559 S 246,573 $ 196,187 $ 389,764 x 86/87 87/88 88/89 89/90 40/91 91/92 Change Actual Actual Actual Actual Actual Estimated 5 Yrs 530,000 540,600 551,400 562,400 573,700 Property Taxes - General S 2,342,044 S 2,746,305 S 2,843,886 S 3,220,047 S 3,191,826 S 3,366,900 43.8% Sates Tax S 4,554,178 S 4,613,220 S 5,244,415 S 5,782,413 S 5,897,182 S 5,925,000 30.1% Schedule 3 x 92/93 93/94 94/95 95/96 46/97 change Projected Proiected Projected Proie-i Proiected 5 Yrs S 3,479,750 S 3,653,700 S 3,836,400 $ 4,028,200 S 4,229,600 25.6% $ 6,120,000 S 6,364,800 S 6,619,400 $ 6,884,200 S 7,159,500 Other Taxes R. E. Transfer Tax S $ 54,559 S 246,573 $ 196,187 $ 389,764 $ 460,000 S 475,000 $ 494,000 S 513,800 S 534,300 S 555,700 Food 8 Beverage Tax - 232,162 522,766 532,403 529,091 524,000 530,000 540,600 551,400 562,400 573,700 All other Taxes 40.944 56.424 58.822 71.818 68.066 112,000 119,200 121,600 124,000 126.500 129.000 Totals $ 40,949 $ 343,145 S 828,161 S 800,408 S 986,921 $ 1,092,000 2566.7% S 1,124,200 $ 1,156,200 S 1,189,200 S 1,223,200 S 1,258,400 Intergovernmental Revenue State Income Tax S 1,365,632 S 1,440,008 S 1,508,599 S 1,775,156 S 1,442,818 S 2,000,000 S 2,050,000 S 1,985,000 $ 2,064,400 $ 2,147,000 S 2,232,900 Replacement Tax 134,544 117,921 155,177 115,665 108,555 109,100 115,000 119,600 124,400 129,400 134,500 :Use 8 Sales Tax - 66,579 96,818 258,231 370,000 330,000 301,600 313,700 326,200 339,300 Other Grants 38.147 52.090 66.872 55,912 75.354 61.575 62.600 67.500 70.000 72,500 75,000 Totals S 1,538,323 S 1,610,019 S 1,797,227 S 2,043,551 S 2,384,958 S 2,540,675 65.2% S 2,557,600 S 2,473,700 S 2,572,500 S 2,675,100 S 2,781,700 Refuse Disposal Revenues Property Tax -Garbage $ 1,197,717 S 1,363,715 S 1,420,476 $ 1,611,324 S 1,694,436 S 1,761,400 S 1,820,200 S 1,911,200 S 2,006,700 S 2,107,100 S 2,212,400 Refuse Disposal Charges - 2.731 63.323 357,674 509 700 742,250 801.600 849,700 900.70 954.704 Totals S 1,197,717 S 1,363,715 S 1,423,207 S 1,674,647 S 2,052,110 S 2,271,100 89.6% S 2,562,450 S 2,712,800 S 2,856,400 S 3,007,800 $ 3,167,100 Other Revenues Permits, Licenses, Fees S 1,692,552 $ 1,798,794 S 2,046,049 S 2,020,118 S 1,876,570 S 1,764,050 $ 1,795,000 S 1,800,000 S 2,150,000 S 2,150,000 S 2,150,000 Service Charges 183,358 211,174 251,911 289,326 320,044 349,500 375,500 400,000 420,000 441,000 463,000 Fines 331,999 321,421 258,678 275,086 285,435 285,600 310,600 325,000 325,000 325,000 325,000 Interest Income 131,650 184,207 294,806 421,889 420,825 247,700 275,000 288,750 303,200 318,300 334,300 All Other Revenues 257,613 185,593 212,622 248.323 305.543 237,425 '235.050 244.500 254,200 264.400 275,000 Totals S 2,597,172 S 2,706,189 S 3,064,066 S 3,254,742 S 3,208,417 S 2,884,275 11.1% S 2,991,150 S 3,058,250 $ 3,452,400 $ 3,498,700 S 3,547,300 Total Operating Revenues $12,270,433 $13,382,543 $15,200,962 $16,775,808 $17,721,414 $18,079,950 47.3% S18,835,150 $19,419,450 $20,526,300 S21,317,200 522,143,600 One Time Reimbursements 690,526 388,205 78.063 179.03 404,285 266,950 <61.3>% 100,000 20.8% 15.2% 9.5% 39.5% 23.0% 22.5% - X Totals - All Reverwies 512.960.959 513,770,798 $15.279.025 $16,954,846 $18,125,699 $18.346,900 41.6% 518,935,150 $19.419,450 520.526,300 521.317.200 $22,143,600 20.7% Assumptions for 92/43 - 96/97: Property taxes will increase 5% annually, Sales tax 4% annually, Intergoverrmentat 4% annually, and Vehicle Licenses 50% (520 to $30) in 94/95. VILLAGE OF MOUNT PROSPECT General Fund Expenditures 86/87, 87/88-91/92, and 92/93-96/97 87/88 Actual 86/87 $ 1,852,851 Actual General Government 91/92 Estimated Public Representation S 56,495 Village Manager's Office 323,965 Communications Division 146,236 Village Clerk's office 110.202 Totals S 636,898 Finance Department S 642,472 Inspection Services Department S 555,902 Public Safety 149,916 Police Department $ 3,476,302 Fire Department 3,149,212 Central Dispatch 296,671 Totals % 6,922,185 Human Services Division S 186,724 Planning 8 Zoning Department S 207,109 Streets and Public Property S 679,027 Streets Division S 1,779,267 Resurfacing - Special Projects 253.617 Totals S 2,032,884 Refuse Disposal S 1,200,511 Civic Groups 8 Misc S 59,485 32.8% Total Expenditures S12,444,170 VILLAGE OF MOUNT PROSPECT General Fund Expenditures 86/87, 87/88-91/92, and 92/93-96/97 87/88 Actual 88/89 Actual $ 1,852,851 89/90 Actual 90/91 Actual 91/92 Estimated x Change 5 Yrs S 59,747 S 59,104 S 65,903 S 72,302 S 71,200 $14,610,515 356,874 392,260 518,263,885 337,189 473,163 426,775 228,950 149,916 163,157 12.4% 162,712 167,423 195,900 177.200 112.490 125.423 S BB5,150 136.301 141.312 144,425 % 1,064,400 S 679,027 S 739,944 S 702,105 S 854,200 S 838,300 31.6% S 685,637 S 703,044 $ 757,011 S 788,465 S 853,220 32.8% S 579,061 S 683,142 S 761,612 $ 828,891 S 881,420 58.6% S 3,581,301 S 3,841,882 S 4,296,720 S 4,576,655 S 4,992,545 3,267,042 3,553,090 3,910,263 4,051,482 4,369,070 329,711 353.005 376,620 339.5 330.120 S 7,178,054 S 7,747,977 S 8,583,603 S 8,967,725 S 9,691,735 40.0% $ 206,658 S 235,638 S 250,046 S 279,713 $ 318,820 70.7% $ 229,718 S 245,502 S 242,120 S 261,378 S 285,035 37.6% S 1,889,042 S 2,216,406 S 2,360,285 S 2,443,337 S 2,491,485 33,000 100,205 882,657 552,986 350,000 261.466 351.201 716,748 573.830 S 2,183,508 $ 2,667,812 S 3,959,690 S 3,570,153 S 2,841,485 39.8% S 1,396,276 S 1,478,389 $ 1,852,851 S 2,116,302 S 2,396,850 99.7% S 118,003 S 109 067 S 112,761 S 130,234 S 157,020 164.0% $13.255-%a $14,610,515 517,221,799 517,797,061 518,263,885 46.8% �t,tauuu i z .'t 92/93 Projected 93194 Projected 94/95 Proieeted 95/96 Protected 96/97 Projected x Change 5 Try S 72,000 S 73,000 S 74,000 S 75,000 S 76,000 13.0% 452,400 475,000 498,750 523,700 549,900 33.6% 207,650 218,050 228,950 240,400 252,400 12.4% 153.100 160.750 168.80 177.200 186,100 26.8% S BB5,150 S 926,800 S 970,500 S 1,016,300 % 1,064,400 27.0% S 904,400 S 949,650 S 997,100 S 1,046,950 S 1,099,300 l 28.8% S 934,300 $ 981,000 S 1,030,050 S 1,081,600 S 1,135,650 28.8% S 5,292,100 $ 5,556,700 S 5,834,550 S 6,126,250 S 6,432,550 4,631,200 4,862,750 5,105,900 5,361,200 5,629,250 349,900 367.450 385,800 405.100 425,350 $10,273,200 510,786,900 511,326,250 $11,892,550 512,487,150 28.8% S 337,950 S 354,850 S 372,600 S 391,200 S 410,800 28.8% S 302,150 S 317,250 S 333,100 S 349,750 S 367,250 28.8% S 2,640,950 S 2,773,000 S 2,911,650 S 3,057,250 S 3,210,100 S 2,640,950 S 2,773,000 $ 2,911,650 S 3,057,250 S 3,210,100 13.0% S 2,538,000 S 2,741,000 $ 2,905,500 S 3,050,700 S 3,203,300 33.6% $ 145.250 S 152,500 S 160,150 $ 168,150 S 176 550 12.4% $18,961,350 $19,982,950 521,006,900 $22,054,450 $23.154.500 26.8% Assumptions for 92/93 - 96/97: Expenditures will increase 6% in 92/93 and 5% in 93/94 - 96/97 except for Public Representation, Refuse Disposal and Civic Groups.