HomeMy WebLinkAbout03/13/1993 COW minutes Minutes
BUDGET WORKSHOP
March 13, 1993
I Call to Order
The meeting was called to order at 9.15 a m. by Mayor Gerald L. Farley Trustees present were
George Clowes, Tim Corcoran, Paul Hoefert and Irvana Wllks. Trustees Mark Busse and Leo
Floros were absent. Also present were Village Manager Michael E. Janoms, Finance D~rector Dawd
Jepson, Assistant Finance Director Carol Wldmer, Inspection Services D~rector Chuck Bencle, and
Enwronmental Health Coordinator Bob Roels Additionally, R~chard Bachhuber, Mmhelle Skowron,
Angela Volpe and three members of the press were in attendance.
II 1993/94 Budget Overview
Mayor Farley opened the meeting by stating that the d~scussmn of the proposed budget is a topic
of major s~gmficance for the Village Board
Village Manager M~chael Janoms explained that staff was taking a new approach in presenting the
1993/94 Budget. The goal is to present an overview at the first meeting and to focus on
departmental budgets at the next meeting. The overview will direct attention to policy issues that
should be addressed and provide insights into the revenue sources expected to finance the proposed
budget. Additaonally, the format has been structured in such a manner to facilitate discussion rather
than as a formal presentataon.
Mr. Janonis stated that the process actually started Thursday, March ll, 1993, with an openmg
presentataon to the Finance Commission. The Commissioners will subma their recommendataons to
the Village Board after their next meetang on March 18, 1993. Mr. Janoms added that although
groups hke the Finance Commission often work in anonymity, their feedback and comments from
residents is what makes the process work.
Mr. Janonis said that although he had been through previous budget presentations, this was his first
as a Village Manager. He then presented some of his thoughts regarding government and the budget
process He stated that government ~s necessary and that it can be posmve He pointed out that
there are some things only government mn do for a community, but there are other th~ngs that
government should not do At the local level, every action has an impact on residents He added
that it is an awesome responsibility and that ~t is a new challenge each day
The annual budget is a reflection of commumty values - its hopes, its desires, its vision for the
future. The budget is a very important task because at not only becomes the Village's fiscal plan,
but it also becomes an authorization to expend funds Mount Prospect has been a stable community
and th~s is reflected in increasing property values and a reasonable tax rate This pos~Uon ~s due to
~ the of the Board and each who makes the
input
person
up
Village
organization
The
organization,
overall, has done a magnificent job, but we absolutely can do better. The abihty to respond to the
"b~g" picture will help to ensure our success or fmlure in the future
The total budget for 1993/94, excluding the L~brary, is $46,535,620, up 2 68% from 1992/93. The
General Fund po~on representing most Village services is up 3.2%. This is consistent with the
increase zn the consumer price index (CPI) for the last 12 months of about 3.0%. Mr. Janonis stated
that a summary of the service areas can be found on pages 2 and 3 of the budget and that these pages
summarize the 1993/94 budget picture.
Mr. Janonis pointed out that the 1993/94 budget Is a "trans~tion" budget It includes a cont~nuataon
of the Capital Improvement Programs but there are no new initiatives and little growth. Total
staffing is down three positions; however, the Village Manager is recommending that three new
police officer positions be added The three new positions would be funded for 1993/94 from a one-
t~me payment received from the State of Illinois
Mr. Janonis affirmed that the V~llage is in a strong financial posltaon and the 1993/94 budget
maintains that pos~t~on. However, he pointed out that the revenue/expenditure imbalance needs to
be addressed Revenues are increasing modestly wh~le fixed costs and mandates have caused
expenditures to grow at a faster rate He c~ted the increase in refuse d~sposal costs of 6.5 %; medical
insurance costs up by some 19%; pension costs up by $ 25 mllhon; and increases for workers' comp
and other insurance. Mandates have increased costs for recycling, yard waste, JULIE, water testing,
EPA and OSHA requirements, ADA, the Family Leave Bill and the Trip Reduction Act.
Mr. Janonis concluded by stating that the Governor has recommended the elimination of the Income
Tax Surcharge for munlcipahtles and tax caps for property taxes He sa~d that reducing shared
revenues, mandating costs for local government and then imposing tax caps is not in the spirit of
good government.
Finance D~rector Dawd Jepson stated that the Village expects revenues of $41,646,155 plus available
fund balances of $4,889,465 to finance the 1993/94 budget. The revenues, net of bond proceeds,
are expected to be up $485,870 or 1.2% higher than 1992/93. The revenue projections assume an
improving economic climate and an increase of 5% in water rates, but no new revenue sources are
included in the proposed budget. Fund balances are expected to be drawn-down $330,000 m the
General Fund, $650,000 in the Water Fund, and some $5.4 million in the Capital ProJects Funds.
These decreases along with increases in the Pension Funds and Debt Service Funds account for the
net reduction of $4,889,465 in fund balances
Mr. Jepson stated that although property tax receipts are expected to increase 7.46%, the 1993 tax
levy will only increase 5%. The receipts in the 1993/94 budget are based on receiving 53% of the
1992 tax levy and 47% of the 1993 levy. Sales taxes are expected to increase 4% and the State
Income Tax by 3%. On the other hand, Licenses, Permits, and Fees are expected to be down 3%,
Investment Income down 2% and Other Revenue down by 19%.
The Village is expecting to receive $400,000 in State Income Tax Surcharge funds in the 1993/94
fiscal year from monies collected by the State for the tax imposed prior to June 30, 1993 An
extension of the tax for municipalities is not anticipated in the budget.
Mr. Jepson smd that the draw down of the fund balances was based on the plan presented to the
Board dunng the Mount Prospect 2000 d~scuss~ons. Although the fund balances would be reduced,
the General Fund and the Water Fund would each have balances at the end of the of
budget
year
$2 5 million dollars. He said the balance in Motor Fuel Tax Fund would be about $430,000 and the
Capital ProJects Funds' baianees would be down to about $220,000 in anticipation of the completion
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f each of the scheduled projects. The balances in the Internal Service Funds, the Debt Service
Funds and the Pension Funds are restricted amounts and can only be used for the purpose for which
the funds were established.
Village Manager Janoms summarized by stating that the 1993/94 transition budget Is a result of the
Mount Prospect 2000 discussions Those d~scussions focused on the revenue/spending imbalance and
brought out some fundamental changes m the Mount Prospect budget process It was brought out
that staff's responsibility is to hold down costs and to maximize service levels. The Board's
responslbdlty ~s to ~dent~fy services to be provided and the means of finanmng those services
As a result of the direction of the Village Board m those discuss~ons, "targets" were estabhshed and
department d~rectors were g~ven the maximum amount of their respective 1993/94 budgets. The
department directors were then asked to submit their budget requests w~thin the established targets
The targets were established using known costs for existing obhgatlons such as medical insurance,
vehicle lease payments, bargained salary increases, and other fixed costs For all non-barga~nmg
group employees 3% was ~ncluded for salary increases The preparation of the proposed 1993/94
budget was driven by the direction given in November and December 1992.
Mr. Janoms then reviewed the results of the Park Ridge Survey which shows the Village w~th the
lowest cost per capita of the 18 municipalities surveyed He also stated that the expected property
tax rate for 1993 is about 13% lower than the 1983 rate and the rate has been relattvely unchanged
for the last five years. He pointed out that the Village receives 10 to 12% of the total property tax
bill and that out of each tax dollar the Village receives, 62 5C goes for police and fire protection,
25.4¢ for refuse d~sposal and 12.1¢ for public improvements.
Mr. Janonis concluded by saying that 1993/94 Is a transition budget - a watershed year. He expects
a number of meetangs between the Board and staff and with citizen focus groups to establish a long-
term plan for the Village.
Dunng the discussion that followed, the Mayor and Trustees agreed that Resident Focus Groups and
other forms of resident input were ~mportant to review how services are provided and the results of
the services provided. Trustee Wilks suggested that the Village explore TQM, or Total Quality
Management. She thought this would help revolve all employees in the decision malang process
Trustee Corcoran responded that TQM is expensive to ~mplement and does not always produce the
desired results. Trustee Hoefert suggested that the Village should randomly survey residents "in
person" regarding ~nput for V~llage services And Trustee Clowes smd he would like to see
meetings w~th residents ~n various locations of the Village. Mayor Farley and Trustee Floros said
they thought Coffee With Council was a good means to communicate with residents on an reformed
basis and that it was less confusing if the meeting was kept in one location
Mayor Farley stated that the next budget workshop would be held on Saturday, March 20, 1993 at
9.00 a m
The meeting adjourned at 12 00.
Respectfully submitted,
David C. Jepson, F~nance Director
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