Loading...
HomeMy WebLinkAbout02/11/1992 COW minutes Minutes COMMVITEE OF THE WHOLE February 11, 1992 I Roll Call The meeting was called to order at 7.35 p m. by Mayor Gerald L. Farley Trustees present were Mark Busse, George Clowes, Tim Corcoran, and Irvana Wilks. Also present were Village Manager John Fulton Dixon, Finance Director David Jepson and Assistant Finance Director Carol Widmer Additionally, there were three members of the news media and three Village residents in attendance Trustee Leo Floros was absent and Trustee Paul Hoefert arrived after the meeting had started II Minutes The Comrmttee of the Whole Minutes of January 28, 1992 were accepted and filed ~ III Citizens To Be Heard No citizens appeared before the Committee IV 1992-1993 Budget Hearing Mayor Gerald L. Farley stated that the upcoming discussions on the proposed budget were very important for the Village Board and for the Community. The Budget is the major fiscal planmng tool for the Village and will prowde d~rection for the Board and Staff during the coming year. He added that the Budget will also be reviewed b~t the Finance Commission and they will present their recommendations to the Board after they have reviewed each section. Mayor Farley smd he will reserve h~s specific comments until all of the Budget has beer/presented. Village Manager Dixon presented a general overview of the 1992-1993 Budget. Mr. Dixon stated that there were a number of changes to the budget format that were added to comply with the Government Finance Officers Association's Distinguished Budget Program The changes include budget organization information, departmental and divisional goals and objectives, supplemental information and a glossary. The intention of the changes is to provide the users with information that will be helpful in understanding the budget Mr. Dixon stated that the 1992-1993 budget continues the tradition of presenting a balanced ('~ iaudget which provides a broad range of services to its residents. The total proposed budget is $45,368,100, and represents a3 4% increase over the 1991-1992 budget of $43,897,390. The tbtal revenues are expected to be $39,816,395, some $5,551,705 less than expected ~ expenditures. Mr. Dixon pointed out that proceeds remaining from the May 1991 and February 1992 bond sales would make up the difference between expected revenues and proposed expenditures. Mr. Dixon reviewed the expected revenue sources and stated that there has been a concern over the economy and its effects on Sales Tax Revenue. He also said that State Income Tax Surcharge monies are included in the budget, but until such time as these funds become permanent they will be used for one-time capital expenditures Mr. Dixon mentioned that expenditures m the General Fund will increase by only 3 2%, but that insurance expenditures will increase by over 9% and expenditures for capital projects will ~ncrease by 46% Specific capital improvements include $292,000 for downtown redevelop~ment, $5 million for flood control projects, $346,000 for commumty improvements, $4 rmlhon for the completion of.the Police and Fire Building, $190,000 for equipment, $167,000 for other improvements and $546,000 for vehicle replacements He stated that expenditures for individual departments and divisions will be covered in depth when the departmental budgets are presented. Mr. Dixon noted that the Vdlage Board had given direction to move ahead on two major projects this year as well as reviewing annexauons that may be appropriate to the Village. Provisions to move ahead on these projects, the possible acquisition of the Citizens Utilities Water and Sewer System and the Triangle Redevelopment Plan, are included m the proposed budget Mr. Dixon acknowledged the cooperation and support of all Department D~rectors and especially the work of Finance Director David Jepson in preparing the 1992-1993 budget T. rustee Wilks asked for a clarification regarding the procedure to be followed for consideration of specific items in the budget Mayor Farley responded that specific ttems could be discussed as they were presented or decisions could be deferred until all the departmental budgets had been presented Trustee Wllks suggested that if a Trustee made a motion for future consideration of an ttem and the motion received a second, the item would be noted in the Minutes and would be brought up for dtscuss~on at the final budget meeting. The Committee concurred with this recommendation. Trustee Clowes stated that he was pleased that goals and objectives were included in the departmental and divisional budgets He also said he would like to see selected performance measures included in future budgets Finance Director David Jepson then reviewed the resources that will be used to finance the 1992-1993 budget He stated that m Ilhnois a municipality must present a balanced budget, and that the budget must include the expected revenues and/or the available fund balances that will be used to hnance the proposed expenditures In the Village's 1992-1993 budget, revenues amounting to $39,816,395 and fund balances of $5,551,705 are expected to finance the proposed expenditures of $45,368,100 Mr. Jepson stated that five sources of revenue are expected to provade 74% of total Village revenues in 1992-1993 Property taxes are the single largest source at 18 6%, with sales taxes, serrate charges, inter-governmental revenues, and investment income making up the balance of the five major sources 2 The proposed 1992 property tax levy is $7,705,478 and represents a 5% increase over the 1991 tax levy. The 1992 tax rate for Village purposes is expected to be $1 004 per $100 EAV. Mr. Jepson pointed out that the Village portion of the tax levy is about 10% of the total tax bill. The second largest source of revenue for the Village comes from sales taxes. Sales taxes in the 1992-1993 budget are projected at $7.1 milhon, an increase of $600,000 over the 1991- 1992 estimate of $6 5 milhon. Included in the expected increase of $600,000 is $400,000 from the 1/4~ home-rule sales tax and $200,000 from the 1% sales tax dtstributed by the State of Illinms. The home-rule sales tax became effective September 1, 1991, so the 1992-1993 estimate of $1 nulhon reflects revenue for a full year compared to seven months in 1991- 1992. The $200,000 increase in the 1% tax anticipates overall growth of 2% along with a full year's receipts from the Wal-Mart store that opened in November 1991. Mr. Jepson explmned that the economy has affected the Village's sales tax revenues and that we would be monitoring these receipts very closely in the coming months Included in Service Charge revenues is an expected increase in water and sewer rates from $2.62 per 1,000 gallons to $2.75 per 1,000 gallons effective May 1, 1992. One other revenue source that was noted is the State Income Tax Surcharge which is expected to increase from $865,000 in 1991-1992 to $1,025,000 in 1992-1993. Mr. Jepson stated that because of the State's fiscal crisis, the Spring Legislative Session will be monitored closely for any possible changes in the dtstribution formulas for State-shared revenues. Mr. Jepson said that one of the important fiscal planning tools for the Village is a schedule ~n the budget which shows the expected fund balances at the end of the fiscal year. The schedule shows the estimated balances at the start of the fiscal year (5/1/92), total 1992- t993 revenues and expenditures and then the expected fund balances at the end of the fiscal year (4/30/93). The schedule shows the General Fund with an expected fund balance of $2,925,900 at the end of the fiscal year, and the combined balances of the Capxtal ProJects · Funds drawn-down by $8,195,760. Mr. Jepson stated that the draw-down of the Capttal Projects Funds was due to bonds being sold in 1991-1992 and the projects being completed ~n 1992-1993. The Water Fund should have an ending balance of $3,228,290, the Internal Service Funds should have $1,671,470 and the Pension Funds $39,325,130 Mr. Jepson explained that the Pension Funds balances are expected to increase by $2.5 million and that these funds are restricted for future employee pensions Mr. Jepson concluded by saying that he thought the budget as presented provided a good fiscal plan for the Village in 1992-1993. Trustee Coreoran asked about the projected increase in sales taxes and the make-up of Internal Service Charges. Mr. Jepson responded that sales tax receipts for the first 8 months of the fiscal year have been $3,789,900 compared to $3,814,000 for the same 8 months in 1990-1991 and that vath good Christmas sales we should reach the $5.9 estimated for 1991- 1992. Receipts for this year include an estimated $130,000 from the new Wal-Mart store. Next year, the Village expects an overall mcrease of $200,000 in general sales tax receipts which is made up of an additional $70,000 from Wal-Mart and a general increase of 2% In addition to the general sales tax the home-rule sales tax is expected to increase $400,000 because it will be in effect for the full year compared to seven months in 1991-1992. Mr.-Jepson stated that Internal Service Charges are amounts paid by the operating departments to the Risk Management Fund and the Vehicle Replacement Fund. The charges ~') are based on actual costs incurred and have increased sigmficantly because medical insurance costs have increased by 14% Trustee Wilks asked about the reduction m Motor Fuel Tax that was recently reported ~ Mr. Jepson responded that due to the recent State budget crisis, a change in the distribution formula was made which will reduce the Village's allocation by an estimated $.62 per capita, or $33,000. The distribution in the current budget year will be reduced by about $19,000 and in the 1992-1993 budget year the reduction will be about $14,000 This is a temporary change that will only be effective through June 30, 1992 Village Manager Dtxon then presented the proposed budgets for the Mayor and Bo'ard of Trustees, the V~llage Manager's Office, the Communications Division and the Village Clerk's Office Mr. Dtxon pointed out that the appropriation for Special Projects in the Mayor and Board of Trustees section had been increased from $10,000 to $12,000. This account covers special requests that come up during the year and are not included elsewhere in the budget Under the Village Manager's budget, a proviston of $20,000 has been included for a Personnel Classification Study. Th~s project ~s intended to implement a consistent pay plan throughout the Village work force. One of the highhghts in the Communications Division budget ~s a provision of $28,200 for replacement of Cable TV equipment, and the Village Clerk's budget provides for the same level of services as last year, including four issues of the V~llage Newsletter. One of the general governmental items included in the Capital Improvements Section of the '~'~ , budget is a prows~on for a new telephone system The existxng system in the Village Hall and olher Village buildings would be updated in conjunction w~th a new system that has been planned for the new Pohce and Fire Building Trustee Clowes provided a hst of suggestions he would like to see incorporated into the Village Newsletter; such as a revised TV hst~ng, a list of Vdlage officials, phone numbers, and the size increased to 8-1/2 x I1. He also said he would hke to see a pubhc information message capa~bihty added to the phone system Trustee Busse asked for an analysis of the cost benefit of contracted legal services compared to an in-house attorney. Village Manager Dixon responded that a report based upon a Northwest Municipal Conference survey would be d~strlbuted on Friday Trustee Busse also asked whether ~t was necessary to fill the vacant position for Assistant Village Manager Mayor Farley responded that this was an important poslt~on and it should be filled. Trustee Corcoran commented that the new telephone system should be user friendly to the residents who call Trustee Wilks stated that she would like to see the Legal Services contractual services amount reduced to $100,000 and that $50,000 be used to hire a full-t~me Village Attorney Mayor Farley said he thought th~s would be a mistake as it is impossible for one indtvldual to be an expert in all areas Trustee Wilks put her recommendation in the form of a motion and ~t was seconded by Trustee Busse Trustee Wilks added that she would like to keep the human ~') element in the new phone system 4 Trustee Clowes said he supported a new phone system and using the latest technology wherever zt is appropriate to provide more efficient senqce. Finance Director David Jepson presented the proposed budgets for the Finance Department and the Self-Insurance Program. Mr. Jepson stated that the Finance Department is responsible for all fiscal operations of the Village. These responslbdlt~es include: accounting, accounts payable, payroll, budgeting, billing and collecting all monies, cash management, investments and financial reporting. During the year, Finance personnel processed 44,400 licenses, 88,000 bllhngs, 1,400 real estate transfer tax transactions and disbursed 16,000 payroll and vendor checks. The proposed Finance Department budget is up from $933,500 last year to $983,405 for 1992- 1993, an increase of 5 4%. The increase can be attributed primarily to $35,000 more in personnel costs and $10,600 in insurance costs. Mr. Jepson stated that two of the Finance Department objectives for the coming year are to close out approximately 1,500 escrow deposit accounts where the projects have been completed and to evaluate and recommend changes in the Village's computer software and hardware. Mr. Jepson reported that the software applications that the Village is currently using were written in 1980-1981 and have been modified dozens of times since they were implemented He stated that $100,000 has been included in the Capital Improvements section of the budget for this purpose and that the total cost is expected to be $150,000 to $175,000 and would cover 2 to 3 years Total insurance costs are expected to be $2,512,000 in 1992-1993 compared to budgeted costs of $2,300,000 in 1991-1992. Medical claims are expected to be $1,400,000, Workers' Compensation claims are budgeted at $300,000 and other rmscellaneous claims at $51,000. General insurance premiums for 1992-1993 are expected to be $285,000 and medical and life insurance is expected to be $292,500. Skyrocketing medical insurance costs continues to be a concern of our Risk Management Program. Medical insurance expense per employee is expected to increase from $4,300 in 1991-1992 to $4,900 in 1992-1993 for an increase of 14%. Mr. Jepson stated that th~s type of increase is not umque to the Village as numerous reports indicate it is a nationwide problem. Trustees Hoefert, Corcoran and Clowes favored moving ahead with the computer project. Villa_ee Manager's Report Village Manager Dixon stated this was the first of four meetings to revaew the budget. The next two meetings will cover the remaining departmental budgets and the last meeting will provide the Mayor and Trustees with an opportunity to recap what has taken place and to formulate the final budget. Mr. D~xon stated that the Auditorium Committee met on Monday, February 10, 1992 and final details for the auditorium are being worked out He also stated that SWANCC had received an IEPA Permit for the Wheehng Township Transfer Station 5 Trustee Clowes asked for a report on the advantages and disadvantages of a 60 channel cable TV system versus a 120 channel system VII Adjournment The meeting adjourned at 10 15 p m Respectfully Submitted Dawd C. Jepson, F~nance D~rector DO/sm