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HomeMy WebLinkAbout11/10/1992 COW minutes '~ Minutes ~ COHNITTEE OF THE ~HOLE ~Nove~ber 10, 1992 ~ ~ ~ I. Roll Cell' ~ ,~ The meeting was called to order by Ma¥0r Gerald L. Farley at 7:35 p.m. Trustees present were Merk Busse, George Clowes, ~Tim Corcoran, Leo Floros, Paul Hoefert and Irvana Wilks. Also present were Village Manager Michael E. Janonis, Finance ~ Director David Jepson, Assistant Finance Director Carol Widmer, Public Works Director Herb Weeks, Police Chief Ronald Pavlock, Inspection Services Director Chuck Bencic, Planning Director Dave Clements, Fire Chief Ed Cavello, Human Services Administrator ~ Nancy Morgan, Communications Administrator Cheryl Pasalic,~ and Personnel Coordinator Donne Russell. In addition, three members of the print media were in attendance. II. Minutes of October 13, 1992 The minutes of October 13, 1992 were accepted and filed. ZIZ. C~tizens-to be Heerd ~ ~ No Village residents appeared, before~ the Committee. IV. Finanoiel Disoussion ~'~ ~ '; At this time Mayor Farle~ ~introduced the major topic of the evening, that being the review and discussion of the Manager's plan to address projected budget deficit conditions. After · introduction, the Manager stepped down from the dais and addressed the Board from the podium. Village Manager Janonis began by introducing his budgetary approach for the future to the Board entitled, "Mount Prospect 2000." Mr.'~Janonis~ presentation was predicated on a description of the~Village's problem as a revenue/expenditure imbalance. ~ He estimated future deficit conditions ranging from $1,107,200.00 in'FY 9~- 94 to $1,696,600.00 in FY 96-97. ~- Mr. Janonis described Mount Prospect 2000 as a.long range comprehensive approach to municipal government. It-redefines the Village's approach to the discharge of'Corporate affairs and includes proposals for long 'range strategic planning, multi-year revenue/spending plans, incentive budgeting and above all, an enhanced Village Board/staff partnership. Fundamentally, Mount Prospect 2000 is designed to resolve short term problems in the context of their long term impact on Village resources and service levels, to ensure a zero deficit on an annual, basis and to maintain Mount Prospect's reputation as an excellent community to live, work and raise a family. Specifically, Village Manager Janonis proposed the following matters for discussion by the Board: 1) this year's fiscal short fall, 2) the need to establish levy requirements for FY 93-94 so that the 1992 tax levy can be established by year's end, 3) to reach general agreement on the parameters of a multi-year revenue/spending plan. The Manager referred to the document that was included in the Trustees'~ packets as he proceeded with his presentation. He based the specifics of his proposals on Village Board policy that limited growth rates in expenditures and the property tax levy to 5% each. ~Within these parameters Mr. Janonis outlined his proposals for the next five years, emphasizing~that~they truly represent a fundamental change in the way we do business. In that regard, Mr. Janonis emphasized that ~the 'Village budget process essentially is a~planning~process that~identifies short and long ~term objectives and focuses on a balanced approach to expenditures and revenue. Mr.~Janonis highlighted two steps ~that he has already implemented, those being his decision not to hire an Assistant Village,Manager and to impose a hiring freeze for non-essential personnel. Mount Prospect 2000 begins with a deficit reduction plan ~or ,~the next five years that is based on six major considerations. First, the Manager presented the basis for the projected deficit for each of the five years,~ including,an estimated $570,000 shortfall in FY 92-93 and explained the steps that could be taken to reduce that deficit and future deficits to zero. Second, the Manager explained the impact of additional services on his deficit reduction plan and used the example of hiring three additional police officers in FY 93-94. Third, the Manager explained the benefits of a basic service refuse disposal program that would more equitably.distribute costs to consistently heavy users,.while also providing basic services and some property tax relief for all property owners. The~Manager's fourth proposal~in his program involved the re- examination of the 5% property .tax ~increase cap to exclude debt servlce requirements. ,The· Manager said the fimplementation of his proposal would .result in a more realistic approach to planning and controlling Village budget growth. .... ~ . The fifth phase of the Manager's plan involved the presentation of new revenue sources, and he turned this part of the presentation to Finance Director David Jepson. Mr. Jepson explained the history, ~ role and benefit of the following revenue~sources which he said are not uncommon in communities such as Mount Prospect. Mr. Jepson discussed a payment from the Village's water fund ~in lieu of~property taxes 'with an estimated~annual revenue,.to the Village of $150,000. Mr. Jepson suggested that expanding the ambulance fee to residents along-with the existing fee charged~to non- ~residents could!realize another $125,000 - $150,000 a year. 2 Mr. Jepson said that a one cent per gallon gasoline tax could result in $150,000 annually, and a tax on utility bills of 1% could raise approximately $500,000 a year, depending~on the scope of implementation. Finally, Mr. Jepson explained how a special service tax to cover the~additional risk ~to the Village from the petroleum,tank farm at the south end of town could raise another $100,000 per year.. While~Mr. Jepson did not recommend the immediate implementation of these revenue sources, he did explain that they were legitimate income areas for the Village to consider. Finally, Mr. Jepson informed the Board that a General Fund balance of $2,500,000 was sufficient~for operating purposes and that the excess could be available as a source of funds. Mr.~Jepson also discussed~the possibility of eliminating the need for a separate IMRF Fund. This would result in a one time gain of $60,200 from the elimination of the separate IMRF Fund. $600,000 of excess fund balance would be available from !the General Fund. ~ ~ Mr. Janonis then e~iained %o the Board that his presentation to this point was an explanation of the basic framework of his plan and ~a menu of the expenditure and revenue options available for Board action. After a short recess Mr. Janonis responded to Board questions. Trustee Ploros requested an explanation of the assumptions upon which the five year deficit was based. Mr. Jepson explainedthat the assumptions were~based on current year and 1993 projections and were not worst case scenarios. They were characterized as optimistic for'economic improvement by the Manager. ,~ ~ Trustee Cloves then offered his support f~r the expenditure reduction plan and identified a 4 1/2% spending cap as the key element in it ...... Trustee- Hoefert asked Mr. Jepson about the possibility of refinancing the Village debt service obligation to take advantage of lower interest rates, to which Mr. Jepson responded that the earliest it could be done to the advantage of the Village would be 1997. Trustee Hoefert further commented that he would like more details on the expenditure ~reduction side of the Manager's plan and commented that Village positions should be prioritized by their importance to providing essential Village .services. Finally Trustee Hoefert offered that any revenue increases should be correlated to specific uses, and offered as an example that gas tax revenues could be used for street repairs. Trustee Nilks asked for further explanation of the water in lieu of taxes proposal as well as information regarding ~the Manager's basic service refuse disposal plan. Mr. Jepson provided background information- to ~ Trustee ~ Wilks' satisfaction. ~ ;~ ~ 3 Trustee Corcoran offered'that the 3 1/2% target growth rate '~would be difficult to achieve considering that approximately 75% of the Village budget is personal services costs and that approximately 70% of those costs are controlled by contractual agreements~ He~'further offered~ that the current deficit problem could be, best described as a short term problem that may be ~best satisfied by a short term solution,such as a 1/4 cent sales tax for three years. Mayor Farley brought the~Board's attentio~ to the immediate ,need to decide how best to resolve the projected~$570,000 deficit~ for FY 92-93.~ He'referred the,presentation of a proposal to the Village~ Manager who recommended ,the Board approve the use of additional spending reductions of $50,000, the assessment of,water,in lieu of taxes monies of $148,100, the use of the IMRF fund balance of $60,200~and General fund monies of $312,300 to meet the $570,600 anticipated deficit. With the exception of Trustee clowes who objected to the water in lieu of taxes assessment the Board endorse~ the Manager's plan for reducing the FY 92-93'deficit. ~illage Manager Janonis then requested the Board to approve a tax'levy for 1992-93 of $7,921,695 for planning purposes and to allow for publication of a public hearing pursuant to the~Truth in Taxation Act. The Manager explained that this amount,excluded the debt service from the 5% growth cap. The Manager also pointed out that this amount could be lowered at a later date, but could not be raised without difficulty. The Board unanimously approved the Manager's request. Trustee Bussa recommended that discussion of Mount Prospect 2000 for the years beginning FY 93-94 be tabled until the next Committee of the Whole meeting. The remainders-of the Board concurred and the Manager thanked them for their,support and ~involvement in this matter of mutual concern and interest. Building Code Review Village Manager Janonis advised the Board that staff has completed the review of the technical aspects of the~proposed update of the Village's Building and Fire Codes. They will proceed with recommendations to implement these changes in early 1993. The Manager further recommended that the issue of fee increases be postponed for six monthsf The Board concurred. 'vI.~Manager's Report ~ Public Works Director Herb Weeks gave an update on the Candota Sewer Project, and a status report on leaf pick-up. '4 VII. Other Business Trustee Wilks thanked staff for their presence and support. No further business was brought to the Board's attention. VIII. &dJournment The meeting adjourned at 10:44 p.m. Respectfully submitted, Ronald W. Pavlock, Police Chief