HomeMy WebLinkAbout6. NEW BUSINESS 7/20/04
Villag.e of Mount Prospect
Community Development Department
MEMORANDUM
fROM:
MICHAEL E. JANONIS, VILLAGE MANAGER
WILLIAM J. COONEY JR., DIRECTOR OF COMMUNITY DEVELOP
TO:
DATE:
JULY 8, 2004
ORDINANCE AUTHORIZING THE ACQUISITiON Of 7 S. EMERSON STREET
g BANK ONE PARKING lOT
SUBJECT:
Attached to this memorandum is an Ordinance that would authorize the Village to acquire the property
at 7 S. Emerson Street for $705,000. This property is currently owned by Bank One and is improved
with a surface parking lot. The acquisition is necessary to assemble the land needed to construct Sub
Area #3 as outlined in the Downtown Strategic Plan.
Staff has been working with the property owner in an effort to negotiate the purchase of this property for
several months. Both parties have satisfied key issues related to the acquisition of the property and
provision of future parking for tenants of the 111 E. Busse office building and are therefore prepared to
complete this transaction.
Please forward this memorandum and attached Ordinance to the Village Board for their review and
consideration at their July 20th meeting. Staff will be at that meeting to answer any questions related to
this matter.
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William. Cooney Jr. J
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7/9/04
ORDiNANCE NO.
AN ORDINANCE AUTHORIZING THE EXECUTION
OF A REAL ESTATE PURCHASE CONTRACT TO ACQUIRE
A PORTION OF DISTRICT NO.1 REDEVELOPMENT PROJECT AREA
IN THE VILLAGE OF MOUNT PROSPECT, ILLINOIS
7 S. EMERSON STREET
WHEREAS, the Village of Mount Prospect is a municipality which exercises
authority pursuant to Chapter 65, Act 5, Section 11-74.4-4.1 et seq. of the Illinois
Municipal Code as set forth in the illinois compiled Statutes, known as the "Tax
Increment Allocation Redevelopment Act"; and
WHEREAS, the President and Board of Trustees of the Village of Mount
Prospect did adopt Ordinance No. 5421 entitled "An Ordinance the Aqquisition of
Property through Condemnation or otherwise in the Tax Increment
Redevelopment Project"; and
WHEREAS, a Real Estate Purchase contract (the "Contract") has heretofore
been submitted to the Village of Mount Prospect with regard to a portion of the
District No.1 Redevelopment Project Area; and
WHEREAS, the President and Board of Trustees of the Village of Mount
Prospect have reviewed the Contract in substantially the same form and
materially similar to Exhibit "A" which is attached hereto and made a part hereof,
and finds that the Contract is in furtherance of the goals, objectives and purposes
of the District No.1 Redevelopment Project Area; and
WHEREAS, pursuant to the provisions of Chapter 65, Act 5, Section 11-74.4-4.1
(c) of the Illinois Municipal Code as set forth in the Illinois Compiled Statutes, the
Village of Mount Prospect is authorized to acquire property, real or personal,
within the District No.1 Redevelopment Project Area by purchase, donation,
lease or eminent domain for the purposes of implementing said redevelopment
project.
NOW, THEREFORE, BE IT ORDAINED BY THE PRESIDENT AND BOARD OF
TRUSTEES OF THE VILLAGE OF MOUNT PROSPECT, COOK COUNTY,
ILLINOIS:
Page 2 of 3
7 S. Emerson Street
SECTION ONE: That it is hereby determined that it is necessary, proper and
desirable that the Village of Mount Prospect acquire title to, and possession of,
the real property being the subject of the Real Estate Purchase Contract, which
is to be in substantially the same form and materially similar to Exhibit "A" which
is attached hereto and made a part hereof.
SECTION TWO: That having determined that the said Contract is in the best
interests of the Village of Mount Prospect and find that the Contract is in
furtherance of the goals, objectives and purposes of the District No.1
Redevelopment Project Area, the Village President and Viilage Clerk are hereby
authorized to execute the Real Estate Purchase Contract.
SECTION THREE: That the ViHage President, Board of Trustees, Village Clerk,
Village Manager, Village Attorney, Special Attorneys, officers and employees are
hereby empowered to perform any act necessary to implement, carry out and
give effect to the terms and provisions of said Contract.
SECTION FOUR: That this Ordinance shaH be in fuil force and effect upon its
passage, approval and publication in pamphlet form in the manner provided by
law.
AYES:
NAYS:
ABSENT:
PASSED and APPROVED this
day of
,2004.
Gerald L. Farley
Village President
ATTEST:
Velma W. Lowe
Vinage Clerk
....m.....m....
..................
Page 3 of 3
7 S. Emerson Street
LEGAL DESCRIPTION: 7 S. Emerson Street
LOT 1 IN MT PROSPECT STATE BANK RESUBDIVISION OF NO.3, A
RESUBDIVISiON OF LOTS 14 TO 19 IN BLK 5 IN BUSSE AND WILLE'S
RESUBDIVIS¡ON IN MOUNT PROSPECT IN THE WEST % OF SECTION 12,
TOWNSHIP 41 NORTH, RANGE 11 EAST OF THE THE THIRD PRINCIPAL
MERIDIAN, IN COOK COUNTY, iLLINOIS
Permanent Index Number: 08-12-104-021
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EXHIBIT A
PURCHASE/SALE AGREEMENT
THIS AGREEl\'IENT is made this - day of May, 2004 ("Agreement") by and between THE
VILLAGE OF MOUNT PROSPECT, ILLINOIS, a municipal corporation and a home rule unit of local
government ("Purchaser"), and BANK ONE [title commitment to indicate ownership} ("Seller").
RECITALS:
A. Seller is the owner of that certain real estate located in Mount Prospect, Illinois, legal1y
described in Exhibit "A" attached hereto and made a part hereof, located south of Busse Road in the Village of
Mount Prospect, Cook County, Hiinois, and improved with a surface parking lot (the "Property").
B. Purchaser desires to purchase from SeHer and Seller desires to sell to Purchaser the Property
upon and subject to the terms and conditions contained in this Agreement.
C. After Closing on this transaction, Seller desires to lease certain parking spaces from Purchaser
and Purchaser desires to [ease certain parking spaces to Set ler in the parking lot on the Property and the parties
desiring to enter into a Lease Agreement ("Lease Agreement").
NOW, THEREFORE, in consideration of the terms and conditions contained in this Agreement, and
for Ten Dollars ($10.00) and other good and valuable consideration paid by Purchaser to Seller, the receipt
and sufficiency of which is hereby acknowledged by Seller, Seller and Purchaser agree as follows:
1. Purchase and Sale. Subject to the conditions and on the terms contained in this Agreement
and the above recitals which are by this reference incorporated herein, Seller agrees to sell to Purchaser and
Purchaser agrees to purchase from Seller the Property and all rights, privileges, easements and appurtenances
to the Parking Lot owned by Seller, including, without limitation, all rights, easements, and other
appurtenances used or connected with the beneficial use or enjoyment of the Parking Lot.
2. Purchase Price. The Purchase Price shall be SEVEN HUNDRED FIVE THOUSAND
DOLLARS ($705,000.00) subject to prorations on the Closing Date (as hereinafter defined) by wire transfer of
immediately available funds, together with stich additional funds for Purchaser's share of closing costs and
prorations as may be required pursuant to this Agreement.
3.
ClosiUf!.
Subject to the terms and conditions contained in this Agreement, the consummation of the transactions
herein contemplated (the "Closing") shall take place forty-five (45) days after full execution of this Agreement
by Purchaser and Seller (the "Ciosing Date") unless the Closing Date is at an earlier or later date by mutual
agreement between the parties. The transaction herein contemplated shall be closed through an escrow with
the Title Company (hereinafter defined) in Chicago, Illinois on the Closing Date, in accordance with the
general provisions of the usual form of "New York Style" Deed and Money Escrow Agreement then in use by
Escrowee, with such special provisions inserted in the escrow agreement as may be required to conform with
this Agreement ("Deed and Money Escrow"). Upon the creation of the Deed and Money Escrow, anything
herein to the contrary notwithstanding, payment of tile Purchase Price and delivery of the Deed (hereinafter
defined) and other documents to be delivered pursuant to Section 6 below, shall be made through the Deed and
Money Escrow. Seller and Purchaser (ifrequired) shall execute gap undertakings in the form required by the
Escrowee or the Title Company (hereinafter defined) in order to close by a "New York Style" dosing.
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4. Documents to be Dclivered bv SeHer Immediately. Seller agrees to deliver to Purchaser all
of the following pertaining to the Property to the extent, in each case, that said materials are known to be in
Seller's possession (collectively, the "Property Information"):
A.
All permits, licenses or approvals pertaining to the Property.
B. A copy of the bi]) or bills issued for the most recent year for which b¡Us have been
issued for all real estate taxes and a copy of any and all notices pertaining to real estate taxes or
assessments applicable to the Property. In the event that any taxes or assessments for said years have
been appealed, Seiler shall provide Purchaser with copies of all petitions for appeal and evidence of
full payment of the cost of any such appeals including the full payment of attorneys' fees.
c.
Seller's surveys relating to the Property.
5.
Title and Survev
A. Condition of Title. Good and marketable fee simple title to the Property shall be
conveyed by Seller to Purchaser or its nominee by a trustee's special or 1imited warranty Deed
("Deed"), subject only to the Permitted Exceptions (as hereinafter defined).
B.
Title.
(i) Title Insurance Commitment. Purchaser shall obtain and deliver to Seller
within thirty (30) days from the date hereof, at Purchaser's sole cost and expense, a
commitment (the "Commitment") for an Owner's Policy of Title Insurance issued by Chicago
Title Insurance Company (the "Title Company") showing title to the Real Property in Sel ler.
(ii) TitleApproval. Purchaser shall have a period often (I 0) business days from
delivery of the Commitment ("Title Review Period") in which to review the Commitment and
deliver to Seller, at Purchaser's election, in writing, such objections as Purchaser may have to
any matters contained in the Commitment ("Purchaser's Objection Notice") (any of said
objections listed on Purchaser's Objection Notice are deemed the "Objectionable
Exceptions"). A1I other exceptions will be deemed acceptable to Purchaser. I[Purchaser fails
to deliver Purchaser's Objection Notice within said 10 business day period, Purchaser will be
deemed to have accepted all the exceptions set forth in the Commitment. If Seller agrees to
eliminate or induce the Title Company to insure over the Objectionable Exceptions, Seller
wi!! be obligated to do so at its cost on or prior to Closing. If Se1ler is unable to cause the
Title Company to insure over all of such exceptions, Purchaser shall have the option to (a)
cancel this Agreement, or (b) close despite such remaining exceptions, in which case such
remaining exceptions shaH be deemed accepted by Purchaser. Ad valorem real estate taxes
not yet due and payable, and all title matters which are not Objectionable Exceptions are
hereinafter referred to as Permitted Exceptions.
(iil) Subsequent Title Exceptions. If an exception to title or other title defect
other than a Permitted Exception is added to the Commitment after receipt by SeHer as a
result of a voluntary action by Seller, and not as a result of any action by Purchaser or any
person acting by, under or through Purchaser, then, prior to the Closing Date, Seller shall use
all commercially reasonable efforts to eliminate or induce the Title Company to insure over
such exception or defect.
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C. Title Policy. On the Closing Date, Seller, at Purchaser's expense, shall cause Title
Company to issue to Purchaser an AL TA 1992 Owner's Policy of Title Insurance ("Title Policy") or
irrevocable commitment to issue same coverìng the Property in the amount of the Purchase Price,
showing fee simple title vested in Purchaser or Purchaser's nominee. Purchaser shall be entitled to
order, at its own expense, any other endorsements it desires, but the issuance of said other
endorsements shall not be a condition of closing.
6.
Documents to be Delivered by Seller at Closinl!.
A. Seller's Closing Documents. On the Closing Date, Seller shal! deliver to Title
Company, pursuant to the Deed and Money Escrow the following documents, all of which shall be
subject to Purchaser's prior review and approval as to form, scope and substance, the delivery of all of
which shall be a specific condition to Closing:
(i)
The Deed;
(ii)
A Non-Foreign Transferor Affidavit in the form of Exhibit "0" attached
hereto;
(Hi)
The Title Policy covering the Property, in compliance with section 5C hereof;
(iv) Such proof of Seller's authority and authorizlltion to enter into this
Agreement and perform Seller's obligations under this Agreement as may be reasonably
required by Purchaser and/or Title Company; and
(v) Such other documents as Purchaser may reasonably request to enable
Purchaser to consummate the transaction contemplated by this Agreement; provided none of
said additional documents imposes any cost or obligation upon Seller not otherwise
specifically imposed upon Seller pursuant to the tenm ofthis Agreement.
B. Purchaser's Closing Documents. On the Closing Date, Purchaser shaH deliver to Title
Company pursuant to the Deed and Money Escrow the following monies and documents, all of which
shall be subject to Seller's prior review and approval as to form, scope and substance, the delivery of
all of which shall constitute a specific condition to Closing:
(i) The Purchase Price, plus Purchaser's share of Closing costs pursuant to the
terms of this Agreement by wire transfer of immediately available funds;
(ii) Proof of Purchaser's authority and authorization to enter into this Agreement
and perform Purchaser's obligations under this Agreement as may be reasonably required by
Purchaser and/or Title Company;
(iii)
AL T A statement; and
(iv) Such other documents as Seller may reasonably request to enable Seller to
consummate the transaction contemplated by this Agreement, provided none of said
additional documents impose any cost or obligation upon Purchaser not otherwise specifically
imposed upon Purchaser pursuant to the terms of this Agreement.
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C. Joint Closing Documents, Each of Seller and Purchaser shall deliver to Escrowee,
pursuant to the Deed and Money Escrow, and the parties hereby covenant and agree to deliver to
Escrowee on or before the Closing Date, the mutua! delivery of which shaH be a specific condition to
Closing:
0) Three (3) copies of the Closing Statement, prepared in strict accordance with
Section 10 hereof;
(ii)
To the extent required, State, County and Municipal transfer tax declarations;
(iii)
A joint direction to Escrowee for the Deed and Money Escrow; and
(iv)
An executed Lease Agreement for the Parking Lot.
7.
Representations and Warranties.
A. Seller's Representations and Warranties. In order to induce Purchaser to execute,
deliver and perform this Agreement and without regard to independent investigations by Purchaser,
Seller hereby represents and warrants to Purchaser as fo1]ow5, and aU of the foregoing and following
representations and warranties shall be true and correct as of the Closing Date (and the truth and
accuracy of which shall constitute a condition to the disbursement of the Purchase Price in accordance
with the terms of the Deed and Money Escrow and this Agreement):
(i) Sel!er is not a party to any contract, agreement or commitment to sell,
convey, assign, transfer, provide rights of first refusal or other similar rights or otherwise
dispose of any portion or portions of the Property.
(ii) This Agreement has been duly authorized and executed on behalf of Seller
and constitutes a valid and binding agreement, enforceab1e in accordance with its terms.
(iii) To the best of Seller's knowledge, there is no litigation pending against SeHer
related to the Property.
(iv) To the best of Seller's knowledge, ScHer has received no written notice of
any special assessments of any nature with respect to the Property or any part thereof.
(v) To the best of Seller's knowledge, Seller has not issued or received any
notices of any violations of any health, safety, pollution, environmental, zoning or other laws,
ordinances, rules or regulations with regard to the Property which have not been heretofore
entirely corrected.
(vi) There are no facts or circumstances not disclosed to Purchaser which SeHer
has knowledge and which have or could have a material adverse effect upon the Property or
which wi!! prevent Seller's full performance of its obligations hereunder. Seller agrees to
notifY Purchaser immediately of such facts or circumstances if Seller becomes aware of the
same.
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B. Purchaser's Representations and Warranties. In order to induce Seller to execute,
deliver and perform this Agreement, Purchaser hereby represents and warrants to Seller as follows,
and all of the foregoing and following representations and warranties shaH be true and correct as ofthe
Closing Date (and the truth and accuracy ofwhich shall constitute a condition to the disbursement of
the Purchase Price in accordance with the terms of the Deed and Money Escrow and this Agreement):
(i) This Agreement has been duly authorized and executed on behalf of
Purchaser and constitutes a valid and binding agreement, enforceable in accordance with its
terms.
(ii) There are no facts or circumstances not disclosed to Seller which Purchaser
has knowJedge and which have or could have a material adverse effect upon the Property or
which will prevent Purchaser's full performance of its obligations hereunder. Purchaser
agrees to notifY Seller immediately of such facts or circumstances ¡fPurchaser becomes aware
of the same.
(iii) Purchaser has not relied and will not rely on any express or implied
representations, warranties, statements, or information pertaining to the Property made or
furnished by Seller or any representative of Seller, property manager or broker, except as
expressly set forth herein.
C. Condition of Pro pert v: "AS IS" and "WHERE IS" Sale; Limitation; and Disclaimer.
Except as expressly set forth in this Agreement, Seller has not made and does not hereby make any
representations, warranties or other statements as to the condition of the Property and Purchaser
acknowledges that at Closing it is purchasing the Property on an "AS IS" and "WHERE IS" basis.
8.
Conditions Precedent to Closine:.
A. In addition to any conditions provided in other provisions of this Agreement,
Purchaser's obligation to purchase the Property is and shall be conditioned on the foHowing:
(i) The truth of each representation and warranty made in this Agreement by
Seller at the time as of which the same is made and as of the Closing as if made on and as of
the Closing.
(ij) That at no time prior to the Closing shall any of the following have been done
by or against or with respect to Seller: (a) the commencement of a case under Title 11 of the
U.S. Code, as now constituted or hereafter amended, or under any other applicable federal or
state bankruptcy law or other similar law; (b) the appointment of a trustee or receiver of any
property interest; or (c) an assignment for the benefit of creditors.
(iii) That between the date hereof and the Closing, (a) Seller shall not, without
first obtaining the written consent of Purchaser, enter into any contracts, agreements or leases
pertaining to the Property and (b) there shall be no material adverse change in the condition of
the Property.
B. Either party may at any time or times, at its election, waive any ofthe cond Wons to its
obligations hereunder, but any such waiver shall be effective only if contained in a writing signed by
such party. No such waiver shall reduce the rights or remedies of a party by reason of any breach by
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the other party (but if a condition is waived, the party waiving the same may not rescind this
Agreement on the basis of the failure of such waived condition). In the event that for any reason any
item required to be delivered to a party by the other pmiy hereunder shall not be delivered when
required, then such other party shal1 nevertheless remain obligated to deìiver the same to the first
party, and nothing (incJuding, but not limited to, the closing of the transaction hereunder) shall be
deemed a waiver by the first party of any such requirement. The failure of any of the aforesaid
conditions shaH entitle Purchaser, at its option, to callceJ and terminate this Agreement without
liabiJityand upon which this Agreement shaH be null and void.
9.
Adjustments.
A. General. Proration of rea! estate taxes, assessments, and other expenses, if any,
affecting the Property shall be prorateà as of the Closing Date ("Proration Date"). There shall be no
proration of any insurance premiums with respect to the Property, nor any assumption of insurance
coverage by Purchaser, unless Purchaser so elects in writing.
B. Taxes. Seller shall pay aH taxes and assessments on the Property due and payable on
or prior to Closing on or before the date when due but in any event prior to the Closing Date. Taxes
and assessments on the Real Property not due and payable as ofthe Closing shall be prorated as of the
Closing Date based upon 110% of the most recent ascertainable assessed valuation, tax multiples and
tax rate, with no reproration thereof. SeHer shall be liable for any back tax bill which may be imposed
by taxing authorities related to the period prior to the Closing Date, which obligation of Sener shaH
survive Closing.
C. Other Prorations. Such additional adjustments as are normally made in connection
with a purchase and sale oftlle type contemplated hereunder.
10. Closin2 Costs. Purchaser shaH bear the cost of the Title Policy (including extended coverage
over the general exceptions), the cost of the Deed and Money Escrow and all state, county and municipal
transfer taxes, if any. Purchaser shall bear the cost of any endorsements to the Title Policy desired by
Purchaser, recording fees with respect to the Deed, all escrow and other expenses in connection with
Purchaser's or its nominee's financing, an of Purchaser's due diligence costs and expenses. Seller shall bear
the cost to record any instruments necessary to dear exceptions and Seller's title pursuant to Section 5 hereof
All other costs and expenses in connection with the transaction contemplated by this Agreement shan be borne
by Purchaser and Seller in the manner in which such cost and expenses are customarily allocated between the
parties at cJosings of real property similar to the Property in the Cook County, Illinois area. Except as provided
in Section 30 below, each party hereto shall pay its own attorneys' fees incurred with respect to the preparation
and negotiation of this Agreement and the closing of the transaction contemplated hereby.
11. Dama2e or Destruction to Property.
A. In the event that between the date of this Agreement and the date of Closing, aJl or
any p0l1ion of the Property is materially damaged or destroyed by fire or other casualty, such that the
cost to repair such darnage exceeds $250,000, Purchaser may eject to:
0) terminate this Agreement without cost, obligation or liability on Purchaser's
part, in which event all rights and obligations of the parties hereunder shall cease; or
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(ii) consummate the transaction contemplated hereby, in which event Purchaser
will receive a credit against the Purchase Price equal to the reasonably estimated cost of repair
of such damage.
B. Purchaser shall notify Seller within twenty (20) days after receipt of notice from Seller
of such damage or destruction of its ejection. If Purchaser faìls to notify Sel IeI' of its election within
said 20-day period, such failure shall constitute an election to terminate this Agreement as aforesaid.
Closing shall be adjusted to allow for such election.
12.
Remedies.
A. If SeHer shoil Id breach any of its covenants, conditions, representations or warranties
contained in this Agreement or should fail to consummate the sale contemplated herein for any reason
other than Purchaser's default, Purchaser may as its sole remedy, upon five (5) days written notice to
Seller, ifsuch breach or failure is not cured within such five-day period (i) terminate this Agreement,
without further liability on Purchaser's part; or (ii) enforce specific performance ofthis Agreement.
B. If Purchaser should breach any of its covenants contained in this Agreement (and
Se! IeI' shall not be in default hereunder), Seller may, upon five (5) days written notice to Purchaser, if
such breach is not cured within such five-day period, tenninate this Agreement without further liability
on Seller's part.
13. Brokers. The parties mutually warrant and represent to the other that neither has authorized
any broker to act on its behalf in respect of the transactions contemplated. Each ofthe parties shall indemnify
and save the other harmless from any claim by any broker or other person for commissions or other
compensation for bringing about the transactions contemplated hereby where such claim is based on the
purported employment or authorization of such broker or other person by such party.
14.
Environmental Matters; Due DHi!!ence.
A. The term "Hazardous Materials" shall mean any substance, material, waste, gas or
particulate matter which is regulated by any local governmental authority, the State oflllinois, or the
United States Government, including, but not limited to, any material or substance which is (i) defined
as a "hazardous waste," "hazardous material," "hazardous substance," "extremely hazardous waste,"
or "restricted hazardous waste" under any provision ofIJIinois law, (ii) petroleum, (iii) asbestos, (iv)
polychlorinated biphenyl, (v) radioactive material, (vi) designated as a "hazardous substance" pursuant
to Section 3! 1 of the Clean Water Act, 33 U.S.C. § 1251 et seq., (33 U.S.c. § 1317), (vii) defined as a
"hazardous waste" pursuant to Section 1004 of the Resource Conservation and Recovery Act, 42
U.S.C. §6901 et seq. (42 U.S.C. §6903), or (viii) defined as a "hazardous substance" pursuant to
Section 101 of the Comprehensive Environmental Response, Compensation, and Liability Act, 42
U.S.c. §960J et seq. (42 U.s.C. 9601). The term "Environmental Laws" shaH mean all statutes
specifically described in the foregoing grammatical sentence and all federal, state and local
environmental, health and safety statutes, ordinances, codes, rules, regulations, orders and decrees
regulating, relating to or imposing liability or standards concerning or in connection with Hazardous
Materials.
B. Each of the following representations is wholly qualified by (a) any matters disclosed
in any materials del ivered to Purchaser by Seller pursuant to Section 4 above or otherwi se, (b) any
matters disclosed in any environmental reports or studies obtained by Purchaser, and (c) any other
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matters known to Purchaser. Subject to the foregoing, Seller represents (but does not warrant), to the
best knowledge of Martin SiJverman, SeHer's transaction manager for the Property:
(i) No re]easing, generating or handling of Hazardous Materials has occurred on
the Property during Seller's ownership of the Property, and Seller has not permitted the
releasing, generating or handling of Hazardous Materials on the Property or the incorporation
thereof in any buildings or improvements thereon; and
(ii) Seller has not received any summons, citation, directive, letter or other
communication, written or oral, from the applicable federal, state or local environmental enforcement
agency (including the United States Environmental Protection Agency and the IIIinois Environmental
Protection Agency) with respect to the Propel1y.
C. Without ¡imiting any provision contained herein, Purchaser, on behalf of itself and its
successors and assigns, waives its right to recover from, and forever releases and discharges, Seller,
Seller's affiliates, Seller's investment manager, the partners, trustees, shareholders, members,
managers, directors, officers, employees and agents of each of them, and their respective heirs,
successors, personal representatives and assigns (collectively, the "Seller Related Parties"), from any
and all demands, claims, legal or administrative proceedings, losses, liabilities, damages, penalties,
fines, liens, judgments, costs or expenses whatsoever (including, without limitation, attorneys' fees
and costs), whether direct or indirect, known or unknown, foreseen or unforeseen, which may arise on
account of or in any way be connected with the physical condition of the Property or any law or
regulation applicable thereto, including, without limitation, the Comprehensive Environmental
Response, Compensation and Liabi lit)' Act of 1980, as amended (42 U .S.c. Sections 9601 et seq.), the
Resources Conservation and Recovery Act of 1976 (42 V.S.C. Section 6901 et seq.), the Clean Water
Act (33 U.S.c. Section 466 et seq.), the Safe Drinking Water act (14 U.S.c. Sections 401-1450), the
Hazardous Materials Transportation Act (49 D.S.c. Section 1801 et seq.), and the Toxic Substance
Control Act (15 U .S.C. Sections 2601-2629).
D. Within thirty (30) days of the date of this Agreement Purchaser and its representative
(including environmental consultants, architects and engineers) shall have the right and opportunity to
enter upon the Property to make such inspections of the Property and matters related thereto, including
the conduct of soil, environmental and engineering tests, as Purchaser and its representatives desire.
Prior to Purchaser's entry onto the Property, Purchaser shall provide Seller with a certificate of
insurance naming Seller as an additional insured thereon and evidencing liability coverage reasonably
satisfactory to Seller for any claims, losses, liabilities or damages resulting from such entry and
inspection. If Purchaser fails to dose hereunder, Purchaser shall return the Property to its condition
prior to Purchaser's entry thereon. Notwithstanding any other provision of this Agreement to the
contrary, in the event Purchaser discovers the presence of a hazardous material or an environmental
condition on Property which Purchaser finds unacceptable or objectionable, Purchaser may deliver to
Seller within said thil1y (30) day period, in writing, notice of Purchaser's objections and election to
terminate this Agreement. In the event Purchaser elects to terminate this Agreement, the parties shall
have no further obligations under this Agreement or to each other.
16. Entire A2reement. It is understood and agreed that aJl understandings and agreements
heretofore made between the parties hereto are merged in this Agreement, the exhibits annexed hereto and the
instruments and documents referred to herein, which alone fully and completely express their agreements, and
that neither party is relying upon any statement or representation, not embodied in this Agreement, made by the
other. Each party expressly acknowledges that, except as expressly provided in this Agreement, the other party
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and the agents and representatives of the other party have not made, and the other party is not I iable for or
bound in any manner by, any express or implied warranties, guaranties, promises, statements, inducements,
representations or information pertaining to the transactions contemplated hereby. The preparation of this
Agreement has been ajoint effort of tile parties hereto and the resulting documents shall not, solely as a matter
of j udidai construction, be construed more severely against one of the parties than the other.
17. Non-Forei~n Certificate. Seller shall provide Purchaser, on or before the Closing Date, with
a non-foreign certificate sufficient in form and substance to relieve Purchaser of any and all withholding
obligations under federal law, which certificate shall be reasonably satisfactory to Purchaser and the Title
Company.
18. Modifications. No modification, amendment, discharge or change of this Agreement, except
as otherwise provided herein, shall be valid unJess the same is in writing and signed by the party against which
the enforcement of such modification, amendment, discharge or change is sought.
19. Notices. All notices, demands, requests and other communications under this Agreement shall
be in writing and shall be deemed properly served (i) on the date sent, if delivered by hand; (ii) one day after
the date such notice is deposited with an overnight delivery service; or (iii) on the date when received with
proof of receipt to the party to whose attention it is directed or when such party refuses to accept receipt if sent,
postage prepaid, by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:
If intended for Purchaser:
The Village of Mount Prospect
100 South Emerson Street
Mollnt Prospect, Illinois 60056
Attention: Village Manager
with a copy to:
Terrence D. McCabe
Ryan and Ryan
33 North Dearborn Street
Suite 1530
Chicago, Illinois 60602
If intended for Seller:
Mike Weinberg
Bank One Real Estate
I Bank One Plaza
Mail Code ILI-O522
Chicago, Illinois 60670
with a copy to:
Thomas M. Hennessey, Esquire
Bank One Law Department
1111 Polaris Parkway, Suite 4P
Mail Code OHI-OI52
Columbus, Ohio 43240
or stich other address or to such other party which any party entitled to receive notice hereunder designates to
the others in writing by a notice du!y given hereunder.
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20. Governin!! Law and Interpretation. The validity, meaning and effect oftlli:; Agreement
shall be determined in accordance with the laws of the State of Illinois applicable to contracts made and to be
performed in that state. The terms "hereby," "hereof," "hereto," "herein," "hereunder" and any similar terms
shall refer to this Agreement, and the term "hereafter" shall mean after, and the term "heretofore" shall mean
before, the date of this Agreement. Words of the masculine, feminine or neuter gender shall mean and include
the correlative words of other genders, and the words importing the singular number shall mean and include
the plural number and vice versa. Words. importing persons shall include finns, assoçjations, partnerships
(including limited partnerships), trusts, corporations and other legal entities, including public bodies, as well as
natural persons. The terms "include," "including" and similar terms shall be construed as if fo! lowed by the
phrase "without being limited to."
21. Counterparts. This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but aJ! of which together shan constitute one and the same instrument.
22. Caotions. The captions in this Agreement are inserted for convenience of reference only and
in no way define, describe or limit the scope or intent of this Agreement of any of the provisions thereof.
23. No Recordation. This Agreement, or any short form or memorandum thereof, may not be
recorded with any governmental authority, and any attempted recordation shall be 1m!! and void and of no
effect.
24. Hindin!! Effect. This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors. This Agreement may not be assigned by Purchaser without the
prior written consent of Seiler, which may be withheld in SeHer's sole discretion, and which shaH not relieve
Purchaser of any liability under this Agreement.
25. Partial Invalidity. Seller and Purchaser intend and believe that each provision in this
Agreement comports with all applicable ¡Deal, state and federal laws and judicial decisions. However, if any
provision or provisions in this Agreement which .is or are not materially related to the liabiJity of the parties
hereto or to the conditions to consummate the transaction contemplated herein is found by a court of law to be
in violation of any applicable local, state or federal ordinance, statute, law, administrative or judicial decision,
or public policy, and ifsuch court should declare such portion, provision or provisions ofthis Agreement to be
illegal, invalid, unlawful, void or unenforceable as written, then it is the intent both of Seller and Purchaser that
such portion, provision or provisions shall be given force to the fuHest possible extent that they are legal, valid
and enforceable, that the remainder of this Agreement shall be construed as if such illegal, invalid, unlawful,
void or unenforceable pOliion, provision or provisions were not contained therein, and that the rights,
obligations and interest of Purchaser and Seller under the remainder of this Agreement shall continue in full
force and effect If any provision or provisions which is or are material as set forth above are found to be
illegal, invalid, unlawful, void or unenforceable as written, this Agreement may, at the option of either party,
be terminated without further obligation to either par1y.
26. Time for Performance. Time is of the essence of this Agreement. Whenever tinder the
terms of this Agreement the time for performanceJalis on a Saturday, Sunday or Legal Holiday, as defined in
205 ILCS 630/17, such time for performance shall be on the next day that is not a Saturday, Sunday or Legal
Holiday. In computing any period of time pursuant to this Agreement, the day of the act or event from which
the designated period of time begins to run will not be included.
27. Professional Fees. In the event oftbe bringing of any action or suit by a party hereto against
another party hereunder by reason of any breach of any of the covenants, agreements or provisions 011 the part
of the other party rising out of this Agreement, then in that event the prevailing party shall be entitled to have
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and recover of and from the other party all costs and expenses of the action or suit, including actual attorneys'
fees, accounting and engineering fees, and any other professional fees resulting therefrom.
28.
Possession. Possession of the Property shall be delivered to Purchaser on the Closing Date.
29. Transaction Under Threat of Condemnation.. Seller and Purchaser agree and acknowledge
that this transaction and the purchase price have been negotiated under the threat of condemnation. The parties
agree and acknowledge that (i) Purchaser heretofore approved an ordinance authorizing the acquisition of the
Property, (ii) Purchaser has the authority to acquire the Property by eminent domain, and (iii) absent this
Agreement, Purchaser would have filed an eminent domain proceeding to acquire the Property.
30. Lease A2:reement Terms and Provisions. Seller and Purchaser agree that the Lease
Agreement shall include, in part, the following terms and provisions:
A.
Term of ten (l0) years with Seller's option to extend for four (4) additional five (5) year
periods, at its option upon ninety (90) days notice to Purchaser, for a total leased term of thirty
(30) years beginning as of the Closing Date.
B.
Seller shall have the right, but not obligation, to lease up to 100 parking permits per month.
c.
Seller's right to lease shall be contingent upon the continued use of the facility at III E.
Busse Road, Mount Prospect, Illinois as an office building.
D.
Seller right to sublease or assign all or any of the parking permits shall be restricted to Seller's
tenants or occupants of the 11 I E. Busse Road property and in all events Seller shall not
sublease or assign all or any of the parking permits at a rental rate higher than that paid to
Purchaser during a given period.
E.
Rental rate shall be $25.00 per parking permit per month for the first ten (10) year term. The
tàir market rental rate for each successive five (5) year period shall be determined by the
appraisal process to be set forth in the Lease Agreement.
F.
The parties execution of this Lease is a condition to Closing.
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II
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as ofthe day and year
first above written.
PURCHASER:
THE VILLAGE OF MOUNT PROSPECT
Dated: July -' 2004
By:
Its:
SELLER:
Dated: July -' 2004
BANK ONE
By:
Its:
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EXHIBIT A
Property Description
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Village of Mount Prospect
Mount Prospect, Illinois
TO:
FROM:
DATE:
SUBJECT:
INTEROFFICE MEMORANDUM ~
MICHAEL E. JANONIS, VILLAGE MANAGER ' '~20' ,', ,
DIRECTOR OF FiNANCE ~
JULY 12,2004
INSTALLMENT NOTE FINANCING FOR ACQUISITION OF PROPER'. .7 OUTH
EMERSON STREET
The Village has recently concluding negotiations for the purchase of property located at 7 South Emerson
Street. Currently there is not sufficient fund balance in the Downtown Redevelopment Fund to cover the
expected cost for this property, so an alternate funding source needs to be identified. In the past we have
issued GO Bonds or borrowed from the General Fund to cover TIF redevelopment costs. I would like to
move away from past practice and recommend we issue short-term installment notes to pay for the
purchase of the above referenced property.
There are several advantages to utilizing installment note financing rather than issuing GO Bonds or
tapping into the General Fund fund balance.
0 Many of the issuance fees (financial advisor, publication, bond paying agent) are eliminated.
0 Timeframe for issuing the installment notes is much shorter and requires jess staff time to
administer.
0 Competitive rates for this type of financing available from loca! financial institutions.
0 Continuing disclosure with national repositories is not required.
0 Maintain General Fund fund balance to cover potential future budget shortfalls or funding needs.
Attached are two of the documents have used in the past to accomplish installment note financing.
Exhibit A is a sample letter sent to authorized financial institutions requesting quotes for the borrowing.
Exhibit B is a draft ordinance authorizing the installment note financing.
The letter stipulates the terms of the loan including a statement that this borrowing would be taxable as to
federal and state income taxes. I typically ask for both a fixed and variable rate to see if there is an
interest cost advantage over the term of the loan by going with one over the other. The letter also
includes a form for the financial institutions to submit their interest rate quote. The draft ordinance has
been prepared with all pertinent information except final rate proposal results.
Please take a moment to review the information and contact me to discuss. I would like to have this item
included on agenda for the July 20th Village Board meeting.
Thanks.
,," "//
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\_~
DAVID O. ERB
DIRECTOR OF FINANCE
copy: Buzz Hill, Village Attorney
I:\RFP Information\lnstaliment Note intra.doc
MA YOR
Gerald L. Farley
VILLAGE MANAGER
Michael E. lanonis
TRUSTEES
Timothy 1. Corcoran
Paul Wm. Hoefert
Richard M. Lohrstorfer
Michaele W. Skowron
¡rvalls. K. Wilks
Michael A. lade!
VILLAGE CLERK
Velma W. Lowe
Phone: (847) 392-6000
Fax: (847) 392-6022
TOO: (847) 392-6064
Village of Mount Prospect
100 South Emerson Street Mount Prospect, Illinois 60056
July 21, 2004
«Title» «FirstName» «LastName»
«Job Title»
«Company»
«Address 1 )}
«City», «State» «Postal Code»
Re:
Request for Proposal- Taxable Installment Note Financing for the Purchase of Real
Property at 7 South Emerson Street, Mount Prospect, Illinois 60056
Dear «Title» «LastName»:
The Village of Mount Prospect desires to obtain taxable installment note financing for the purchase
of real property at 7 South Emerson Street, Mount Prospect, Illinois 60056. This parcel of property
falls within the boundaries of the Village's Downtown Redevelopment TIF District No. I and is
being acquired for future redevelopment. The total amount of financing requested is $705,000.
The purpose ofthis letter is to solicit interest rate quotes from your financial institution for the
financing of the above-mentioned purchase. The terms for repayment shall provide for one
annual payment per year over a five-year period beginning in 2005. See Exhibit "A" for additional
repayment terms. It is desired that the note be dated when requested funds are received. We request
both a fixed and a variable rate quotation with the variable interest rate changing no more than once
per year at the time the annual payment is made. The quote must be in effect for forty-five (45) days
from the proposal due date. Please use the enclosed fonn to supply your response. Also, please
provide any specific provisions you may require to execute this transaction.
Pursuant to the provisions of Section 265(b)(3) ofthe Internal Revenue Code of1986, the debt
will be considered a "private activity bond~~ as defined in Section 141(a) of the code and the
loan may not be considered a "qualified tax exempt obligation" of the Village.
RFP ~ Installment Note Financing
7/21/2004
Page 2 of 2
Please submit your proposal utilizing Exhibit A (attached) no later than 1 :00 p.m. on Tuesday,
August 10,2004. The interest rate quote must be good for forty-five (45) days from the proposal
due date. Board authorization for the financing is expected at the Village Board Meeting scheduled
for August 17,2004.
Please address any specific questions regarding the request to:
David O. Erb, Director of Finance
Village of Mount Prospect
100 South Emerson Street
Mount Prospect, IL 60056
I may also be reached at (847) 818-5276. Thank you for your consideration in this matter.
Sincerely,
David O. Erb
Director of Finance
DOE/lb
Attachment
I:\RFP Infonnation\InstaHment Note Financing\RFQ TIF - $800K Financing for Bank One Lotdoc
Exhibit "A"
To: Village of Mount Prospect
Proposal to Provide Taxable Installment Note Financing
for the Purchase of Real Property
at 7 South Emerson Street, Mount Prospect, Illinois
Terms: .
Amount to be Financed:
Period to be Financed:
$705,000
5 years
Repayment Terms:
Years 1 through 3: Interest Only
Year 4: $350,000 Principal, plus interest
Year 5: $355,000 Principal, plus interest
Fixed Rate:
Variable Rate:
%
% Based on % of prime rate. Interest
rate to change at annual principal
payment date.
Please include the proposed amortization schedule as requested above that corresponds
to the quoted rate{s).
Additional Provisions/Comments:
Financial Institution
Authorized Official/Position
Signature of Authorized Official
Date
ORDINANCE NO5
ORDINANCE AUTHORIZING AN AGREEMENT WITH
TO EXECUTE A TAXABLE NOTE IN THE AMOUNT OF $705,000
FOR FINANCING THE ACQUISITION OF PROPERTY LOCATED IN THE
DOWNTOWN REDEVELOPMENT AREA TIF DISTRICT NO.1
WHEREAS, the Village of Mount Prospect (Village), located in Cook County, Illinois, is a home
rule unit of government under the provisions of Article 7 of the 1970 Constitution of the State of Illinois,
can exercise any power and perfonn any function pertaining to its government affairs, including but not
limited to the power to tax and incur debt; and
WHEREAS, the Village adopted Ordinance No. 5421 authorizing the acquisition of property
located at 7 South Emerson Street, Mount Prospect, Illinois; and
WHEREAS, funds for the purchase of the property will be obtained through installment note
financing; and
WHEREAS, the Village solicited "Requests for Proposal (RFP)" from five (5) financial institutions
requesting quotations on a five (5) year installment arrangement for SEVEN HUNDRED AND FIVE
THOUSAND dollars ($705,000) on either fixed or variable rates of interest; and
WHEREAS, interest on such installment note will not be exempt from federal or state income taxes;
and
\VHEREAS, the table attached to this Ordinance as Attachment "A" summarizes the proposals
received; and
WHEREAS, the proposal submitted by
of
, Illinois for a
fixed/variable rate of -. _% for five (5) years is the most economically feasible proposal; and
WHEREAS, the Village President and Board of Trustees ofthe ViHage have detennined it is
necessary and in the public interest to finance the purchase the above reference real property totaling
SEVEN HUNDRED AND FIVE THOUSAND dollars ($705,000) through an installment note financing
agreement with the Bank
NOW, THEREFORE BE IT ORDAINED BY THE PRESIDENT AND BOARD OF TRUSTEES
OF THE VILLAGE OF MOUNT PROSPECT, COOK COUNTY, ILLINOIS AS FOLLOWS:
SECTION 1: The Corporate Authorities do hereby incorporate the foregoing WHEREAS clauses
into this Ordinance as though fully set forth therein thereby making the findings as hereinabove set forth.
SECTION 2: It is hereby detennined that it is advisable, necessary and in the interests of the public
health, safety and welfare that the Village purchase the above real property described in the foregoing
WHEREAS clauses and for the purpose of paying the purchase price thereof, to enter into an agreement for
installment note financing in the amount of SEVEN HUNDRED AND FIVE THOUSAND dollars
($705,000) with the of, lHinoisat a fixed/variable interest rate of
-' - % amortized over a five (5) year term payable annually as specified in their written proposal. Sai d
proposal is attached as Attachment "E" hereto and made a part ofthis Ordinance.
SECTION 3: Pursuant to Section 265 (b)(3) of the Internal Revenue Code, the debt will be
considered a "private activity bond" as defined in Section 141 of the code and the loan is not considered a
"qualified tax exempt obligation" of the Village.
SECTION 4: For the purpose of providing the funds required to pay the installments, when and as
the same faU due and until the balance due has been paid in full, the Village of Mount Prospect shall use
incremental tax revenues of the Downtown Redevelopment Area TIF District No.1 for such payments, or
such other funds as they may deem necessary to procure and/or which are available. The indebtedness
described herein is a general obligation backed by the full "faith and credít" of the Village.
SECTION 5: The President, Village Treasurer and Village Clerk are hereby authorized to execute
aU documents necessary to effectuate said financing and any other appropriate documents.
SECTION 6: That this Ordinance shall be in full force and effect from and after its passage,
approval and publication in pamphlet form as provided by law.
Passed by the Board of Trustees of the Village of Mount Prospect, Illinois and approved by the
President thereof this - day of August 2004.
Ayes:
Nays:
Absent:
1:\TiF Finanda!s\Updated Financials - June 2004\Property Purchase Ordinance - TIF - 2004 ($800K).doc
INTEROFFICE MEMORANDUM
Village of ~tount Prospect
Mount Prospect, Illinois
TO:
FROM:
DATE:
SUBJECT:
MICHAEL E. JANONIS, VILLAGE MANAGER
DIRECTOR OF FINANCE
JULY 1,2004
COMPREHENSIVE ANNUAL FINANCIAL REPORT -12/31/03
PURPOSE:
To present the Comprehensive Annual Financial Report (CAFR) for the fiscal year ended December 31, 003.
BACKGROUND:
Each year the Village retains a CPA firm to audit the Village's financiaLs and assist in the preparation of the annual
CAFR. Sikich Gardner & Co, LLP performed the audit for the Village for fiscal year ended December 31, 2003.
DISCUSSION:
The format of the CAFR changed for year-end December 31, 2003 due to the implementation of Governmental
Accounting Standards Board (GAS B) Statement 34. For the first time, the financial report will present two kinds of
statements, each with a different snapshot of Village finances. The new financial statement's focus is on both the
Village as a whole (government-wide) and on the major individual funds. Both perspectives allow the user to address
relevant questions, broaden a basis for comparison from year-to-year at the Village and also between governments and
enhance the Village's accountability.
Sikich Gardner has given its audit of the Village for year-end 2003 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. Their opinion can be found on pages 1 and 2 in the financial section of the report.
A detailed overview of the financial results for the fiscal year is provided in the new Management's Discussion and
Analysis (MD & A), which may be found immediately following the auditor opinion on page 3 of the financial
section. Following are a few of the more significant highlights:
General Fund: General Fund revenues of $28,690,463 fell short of projections by $515,964 or 1.77%. The
following table shows the variance from final budget for revenues broken down by major revenue category.
Revenue Type Final Budget Actual $ Variance % Variance
Property Taxes $ 7,811 ,655 $ 7,600,505 $ (21 1, 150) (2.70%)
OtherTaxes 4,152,258 4,032,759 (l 19,499) (2.88%)
Licenses & Pennits 3,020,130 3,049,969 29,839 0.99%
lnten~ovemmen tal 12,226,253 1l,960,454 (265,799) (2.17%)
Service, Charges 797,053 772,163 (24,890) (3.12%)
Fines & Forfeits 487,960 595,170 107,210 21 .97%
Investment Earnings 170,000 101,446 (68,554) (40.33%)
Miscellaneous 541,118 577,997 36,879 6.82%
Total Revenue $ 29,206,427 $ 28,690,463 $ (515,964) (1 .77%)
Comprehensive Annual Financial Report
Juiy 1, 2004
Page 2
Property taxrevenueswere down $211,150 from the final budget. The amount collected by the County and
remitted to the Village came in at 97.3% of the original levy. This is slightly below the average collection
ratio of 98.1% for the Village in the past five years.
Revenue dassified, as Other Taxes also came in below our projections by $119,499, or 2.88%. The shortfall
can be attributed mostly to the telecommunication tax, which feU short of projections by $170,300, Excluding
this item from the Other Taxes, revenues in this category would have exceeded the final budget by $50,801.
The real estate transfer tax continues to remain strong generating a positive variance of $31 ,865 from the final
budget amount and $256,865 above the original budget amount.
Intergovernmental revenues fell short $265,799 or 2.17% from the $12,226,253 projected. State Income and
Sales taxes came in significantly under both the original and the final budget projection, which was revised
downward during the year. Receipts from sales and income taxes were down $223,034 and $43,289
respectively. The state use tax also showed a drop of$27,853 or 5.3%. Corporate personal property
replacement taxes of$184,589 vv'ere$3,636 above projection. Expectations for intergovernmental revenues
remain a concern as long as the State of IUinois continues to have its budget woes.
Fines and forfeits exceeded revenue projections by $107,210 or 21. 97%. The increase was mainly due to an
increase in the disposition of moving violations by the, county circuit court system. Investment earnings were
negatively impacted by the low interest rates continuing to be offered in the marketplace. Investment earnings
came in $68,554 or 40.33% below the final budget projection. This projection was also revised downward
during the year.
Actual expenditures totaled $29,045,233, representing a positive variance of$849,525, or 2..84%, under the
revised 2003 Budget. The following table presents a breakdown of actual expenditures as compared to the
final budget for each department.
$ Variance % Variance
Positive! Positive!
Department Final. Budget Actual (Negative) eN egative)
Public Representation $ 104,167 $ 100,878 $ 3,289 3.16%
Village ,Manager 1,793,366 1,794,589 ( 1 ,223) (0.07%)
Television Services 182,889 160,691 22,198 12.14%
Village Clerk 165,792 154,066 1 1,726 7.07%
Fìnance 1,293,086 1,247,596 45,490 3.52%
Community Development 1,545,933 1,387,817 158,1 16 10.23%
Human Services 765,105 686,968 78,137 10.21%
Police 10,445,481 10,187,424 258,057 2.47%
Fire 8,353,838 8,310,001 43,837 052%
Public Works 4,919,253 4,699,725 219,528 4.46%
Other 325,848 315,478 10,370 3.1 8%
Total Expenditures $ 29,894,758 $ 29,045,233 $ 849,525 2.84%
Comprehensive Annual Financial Report
July 1, 2004
Page 3
The results from operations of the General Fund are showing a deficit in 2003. Expenditures exceeded revenues by
$354,770. In addition, a transfer of$170,000 was made to cover a portion of the debt service for the new Village
Hall. Fund balance totaling $524,770 was used to cover the combined shortfall. The original budget called for a
planned drawdown of $802,023. Fund balance as of December 31, 2003 was $8,925,154. Unreserved fund balance
at year~end was $8,779,145, representing 27.8% of budgeted operating expenditures for 2004.
Special Revenue Funds: In total, the special revenue funds are showing an excess of expenditures over revenues
in the amount of $327 ,8IS. Fund balance for the special revenue funds totaled $3,832,581 at year-end.
Debt Service Funds: The various debt service funds are showing a combined operating deficit of $642,667 for the
year, on revenues and other financing sources of $5, 147,400 and expenditures of$5,790,067. The Village has
intentionally drawn down excess fund balance in some of its debt service funds. Fund balance for all the debt
service funds totaled $790,066 at December 31, 2003.
Capital Projects Funds: Revenues and other financing sources exceeded expenditures by $71,166 in 2003. The
surplus was due to the issuance of the $12.3 million GO Bond issue in February 2003 to cover the remaining
construction costs of the new Village Hall. These bond proceeds are expected to be spent down by the end of2004.
The year-end fund balance for the capital project funds is $10,931,557.
Water and Sewer Fund: This fund is showing a net deficit $69,202 on revenues of $7,930,259 and expenses of
$7,999,461. The net income figure includes depreciation expense of $442,746 and excludes $102,700 of bond
principal payments.
Pension Trust Funds: The net assets ofthe Police and Firefighter pension funds increased during 2003. The
Police Pension Fund is showing an increase of $2,604,000 in net plan assets, while the Firefighters Pension Fund is
showing an increase of $1,929,210.
According to the December 31, 2002 actuarial report, the most recent information available, the Police Pension
Fund was 75.3% funded and the Firefighters Pension Fund was 80.06% funded.
RECOMMENDATION:
It is recommended the Village Board accept the Comprehensive Annual Financial Report for the fiscal year ended
December 31, 2003.
/tJ;¡~..:~.",. / ,.'? tì;,:A_-
....,
DAVID O. ERB
DIRECTOR OF FINANCE
Copy: Finance Commission
DOE/
H:\ACCT\AUDIT\2003 Audit\Correspondence\Bd Memo 2004.doc
Village of Mount Prospect
Mount Prospect, Illinois
INTEROFFICE MEMORANDUM
FROM:
MICHAEL E. JANONIS, VILLAGE MANAGER
DIRECTOR OF FINANCE
TO:
DATE:
JUNE 30, 2004
SINGLE AUDIT ACT COMPLIANCE -12/31103
SUBJECT:
PURPOSE:
To present the Single Audit Compliance Report for the fiscal year ended December 31, 2003.
BACKGROUND:
Each year as part of the annual financial audit, the Village engages a CPA firm to undertake a
compliance audit of the Village's federal and state grant receipts pursuant to the U.S. Office of
Management and Budget (OMB) Circular A-133. This is commonly referred to as the Single
Audit Act. Sikich Gardner & Co. LLP performed the Single Audit for the fiscal year ended
December 31,2003.
DISCUSSION:
As you can see on pages 3 and 6 of the Single Audit Report, the auditors are reporting that the
VHlage complied with the Single Audit Act for 2003.
RECOMMENDA nON:
It is recommended the Village Board accept the Single Audit Compliance Report for the fiscal
year ended December 31,2003.
¡('.../tl(.~""
FL.'
/.' /' þ"
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.....
DAVID O. ERB
DIRECTOR OF FINANCE
DOE!
H:\ACCT\AUDm2003 Audit\Single Audit\Memo to Manager.doc
Village of Mount Prospect
Mount Prospect, Illinois
INTEROFFICE I\1EMORANDUM
FROM:
MICHAEL E. JANONIS, VILLAGE MANAGER
DIRECTOR OF FINANCE
TO:
DATE:
JUNE 30, 2004
Tlf COMPLIANCE AUDIT -12/31/03
SUBJECT:
PURPOSE:
To present the Report on Compliance with Public Act 85-1142 for the fiscal year ended
December 31,2003.
BACKGROUND:
Each year as part of the annual financial audit, the Village engages a CPA firm to undertake a
compliance audit of our tax increment financing activities. Sikich Gardner & Co. performed the
TIF compliance audit for the fiscal year ended December 31,2003.
DISCUSSION:
On page four of the TIF audit is the Report of Independent Accountant's on Compliance. In this
report, the auditors indicate that the Village has complied with the requirements of the Tax
Increment Redevelopment Allocation Act (P .A. 85-1142). Page three lists the combining schedule
of revenues, expenditures and changes in fund balance for the 2003 fiscal year and the Statistical
Section on pages fivegseven list the summary of activity and schedule of fund balance from the
inception of the TIF through 2003.
RECOMMENDATION:
It is recommended the Víllage Board accept the Report on Compliance with Public Act 85-1142
for the fiscal year ended December 31, 2003.
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David O. Erb
Director of Finance
DOE!
H:\ACCnAUDI1ì2003 Audit\Correspondence\TIF Compliance Audit Transmittal.doc
Village of Mount Prospect
Mount Prospect, IUinois
INTEROFFICE MEMORANDUM
FROM:
MICHAEL E. JANONIS, VILLAGE MANAGER
DIRECTOR OF FINANCE
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TO:
DATE:
JUNE 30, 2004
AUDITOR'S MANAGEMENT lETTER -12/31/03
SUBJECT:
PURPOSE:
To present the Auditor's Management Letter for the fiscal year ended December 31,2003.
BACKGROUND:
Auditing Standards require auditors to present a management letter to the governing boards of
entities they have audited. The purpose of theietter is to inform the board of any problems they
encountered during the audit, and to report any deficiencies in internal controls uncovered
during the course of the audit.
DISCUSSION:
Attached is the Management Letter prepared by Sikich Gardner & Co. for the fiscal year ended
December 31,2003.
Page three of the Management Letter reports on current year recommendations. There were
two recommendations for improvement presented. They recommended a system to monitor
pledged collateral for funds on deposit at depositories exceeding FDiC insurance. The Finance
Department concurs with this recommendation and has put procedures in place to ensure all
funds remain adequately collateralized. The auditors also recommended the Village examine
user fees charged to other Funds that support risk management activities. The Village is
currently looking into alternatives for administering its risk management program in order to
control claims costs.
There were no recommendations for improvement from the prior year that required follow-up.
RECOMMENDATION:
It is recommended the Village Board accept the auditor's Management Letter for the fiscal year
ended December 31,2003.
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David O. Erb
Director of Finance
DOE!
H:\ACCT\AUDIT\2003 Audit\Correspondence\Managment Letter Transmittal.doc
bh/hjm
ORDINANCE NO.
AN ORDINANCE AUTHORIZING THE SALE OF CERTAIN PERSONAL
PROPERTY OWNED BY THE VILLAGE OF MOUNT PROSPECT
WHEREAS, the President and Board of Trustees have received a report from the
Village Manager that all items of personal property and fixtures which may be of use to
the Village at 100 South Emerson Street will be removed before July 31, 2004 and that
all items remaining on the premises are surplus; and
WHEREAS, the Village will no longer be occupying the premises at 100 South
Emerson Street and much of the personal property and fixtures at that location is of no
value to the Village; and
WHEREAS, the Corporate Authorities of the Village of Mount Prospect, Cook
County, Illinois have determined that it is no longer necessary, useful, or in the best
interest of the Village of Mount Prospect to retain such personal property and fixtures;
NOW, THEREFORE, BE IT ORDAINED BY THE PRESIDENT AND BOARD OF
TRUSTEES OF THE VILLAGE OF MOUNT PROSPECT, COOK COUNTY, ILLINOIS,
ACTING IN THE EXERCISE OF THEIR HOME RULE POWERS:
SECTION ONE:
In the exercise of their home rule powers, the Corporate
Authorities of the Village of Mount Prospect find that the items of personal property and
fixtures remaining on the premises of 100 South Emerson after July 31, 2004 are
surplus and shall be sold in the manner deemed appropriate by the ViHage Manager.
¡Manage 137834 I
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SECTION TWO: The Village Manager will cause a public notice informing the
general public of any sale to be published in a newspaper of general circulation.
SECTION THREE: This Ordinance shall be in full force and effect from and after
its passage, approval and publication in pamphlet form in the manner provided by law.
AYES:
NAYS:
ABSENT:
PASSED and APPROVED this
day of
,2004.
Gerald L. Farley
Village President
ATTEST:
Velma W. Lowe
Village Clerk
H\CLKO\fIJes\W1N\ORDINANC\Olspose of old VH surplus,July,2004doc
¡Manage 137834 I