North Cook News

Village of Wilmette Committee of the Whole met August 28.

Here is the minutes provided by the Committee:

Members Present:

President Bob Bielinski

Trustee Julie Wolf

Daniel Sullivan

Senta Plunkett

Kathy Dodd

Joel Kurzman

Stephen M. Leonard

Staff Present: Timothy Frenzer, Village Manager

Michael Braiman, Assistant Village Manager

Alex Cease, Assistant to the Village Manager

John Prejzner, Assistant Director of Administrative Services

Peter Skiles, Director of Administrative Services

Melinda Molloy, Finance Director

John Risko, Assistant Finance Director

Benjamin Wozney, Fire Chief

Robert Brill, Deputy Fire Chief

Brigitte Berger-Raish, Director of Engineering & Public Works

Guy Lam, Assistant Director of Public Works

Kurt Smith, Vehicle Maintenance Superintendent

Kyle Murphy, Chief of Police

Kyle Perkins, Deputy Chief of Police

Nabil Quafisheh, Director of Water Management

Nate Jordan, Assistant Director of Water Management

Dan Smith, Engineering Assistant

I. Call to Order

President Bielinski called the meeting to order at 7:00 p.m.

Village Manager Timothy Frenzer reviewed the Capital Improvement and Village Budget process for the next few months from the attached report.

II. Discussion of General Fund

Melinda Molloy, Finance Director, said an approximate $600,000 is projected to be added to the General Fund reserve. She noted revenues are exceeding budget and expenditures are under budget.

Mr. Frenzer said the State of Illinois budget includes two revenue reductions for local governments; 1) one-time 10% LGDF reduction estimated at $267,000 and 2) 2% administrative fee on collection of home rule sales tax, estimated at $42,000 per year.

Ms. Molloy reviewed the revenue sources noting that permit revenues are up over $600,000, $495,000 of this revenue is non-recurring. Assuming the minimum recommended reserve level is met, the Budget Reserve Policy directs the Village to allocate 50% of annual non-recurring revenues to the Capital Equipment Replacement Fund. Through July, this would be $247,500 in FY 2017. Because the General Fund Reserve exceeds the minimum recommended level, the Village Board may wish to allocate the remaining non-recurring revenues to other critical needs and staff recommends;1) $267,000 for FY 2018 LGDF reduction, 2) $88,0000 for FY 2018 engineering maintenance program, 3) $247,500 for additional CERF contribution.

President Bielinski said the other option could be to take over performance in budget this year and give it back to residents.

Michael Braiman noted that all the expenditures in the General Fund are trending down and reviewed the 2017 projected budget variances which are greater than $20,000. He reviewed the capital improvements to be funded by bond proceeds in the FY 2017 budget noting that the Village intends to issue the debt to finance these projects later this fall.

Ms. Molloy reviewed the process for selling bonds and the advantages to refunding the bonds for lower rates and savings.

Ms. Molloy said the ending reserve balance for the 2017 General Fund is projected to be $10.8 million.

Mr. Braiman summarized the 2018 CIP General Operating projects that would be funded as the budget allows.

The Village Board discussed the Server Room HVAC, the Salt Brine Machine and the GIS Hardware/Software included in the projects to possibly be funded. Mr. Braiman noted they do not know at this time what projects will be funded until they review the projected finances for FY 2018.

Mr. Braiman said in 2016, the Village Board committed to funding an annual $2 million Road Program to steadily improve the condition of roads in a fiscally responsible manner. The Village increased the annual budget from $1.5 million to $2 million by; 1) increasing the local fuel tax by $0.03 to $0.04 per gallon, 2) property tax levy increased by 0.90% ($150,000), 3) use of $125,000 in reserves. In 2027, retired debt service is planned to be utilized to increase the annual budget to $3.5 - $4 million. Last year, the discussion was that the Village is not able to continue using reserves every year on what is an ongoing maintenance program and staff was to find a way to solve that issue for the 2018 budget so we are using regular recurring revenues to fund the $2 million. The 2018 road program budget will be fully funded through recurring revenues identified through personnel savings.

Ms. Berger-Raish reviewed the Road Program Overview through 2026 and 2036. She also summarized the 2018 CIP Engineering Program noting the engineering projects are ranked as critical or recommended and will be included in the FY 2018 budget as funding permits.

Trustee Kurzman noted there is street light pole purchase included in the projects and asked where the Lawler Street falls in that program for street lights as it is a public safety issue.

President Bielinski asked staff to prepare an analysis of streets in that area which currently lack lighting.

Mr. Braiman continued reviewing the 2018 CIP – CERF projects recommended noting the vehicle replacement history for Public Works, Police and Fire Departments.

Mr. Braiman moved forward with the expenses for 2018 General Fund projections noting staff is preliminarily projecting 1.6% growth. Wages and overtime are estimated to increase in FY 2018 by only 1.0% despite a 2.5% cost of living adjustment. He said the proposed numbers still need to be refined for the proposed budget to be presented in October.

Ms. Molloy summarized the 2018 pension contribution estimate. She noted that the rating agencies have focused on what the pension liability means on an ongoing basis. She said even though the Village contributes what is actuarially required, current funding does not reduce the unfunded liability in the public safety pension plans.

The tax levy contains the following components; 1) General Operating Expenses, 2) Pension Expense, 3) Road Program, 4) Debt. Ms. Molloy noted that the Village can control the Operations portion of the levy which includes salaries and non-pension benefits, contractual expense, commodities, and recurring capital. The projected tax levy for FY 2018 is 4.58%.

Mr. Prejzner said the solid waste fee funds 100% of the solid waste program cost. In 2015 the Village renegotiated its refuse contract for a projected $2 million savings through 2020. The revised contract reduced the Village’s expense by 2% in 2016, held the expense flat in 2017, and will increase by CPI moving forward. The 2018 solid waste is projected to increase by 2.5%, which is $7 per year per household.

III. Water Fund

Mr. Braiman continued with the Water Fund FY 2017 Revenues and Expenses noting the Village is down slightly in water consumption. The 2018 Water Fund CIP projects listed in the report are ranked as critical or recommended and will be included in the FY 2018 budget as funding permits.

Mr. Quafisheh said the Water Plant Electrical Improvement project was rated as the Water Plant’s highest priority to ensure continuity of water service by the engineering firm which conducted a water plant needs assessment in 2015-16. The improvements over 3 years include replacement of both generators, main switchgear and motor control centers at an initially estimated cost of $7.7 million. The engineering design of the electrical project improvements project commenced in 2017 and is at 90% completion. The updated cost, based on 90% design is $8,975,000 due to the HVAC and routing of conduits. He noted they are still waiting to hear from the IEPA regarding a low interest loan for a portion of the project.

Ms. Molloy said the Village has a Water Fund Reserve Policy in place that identifies 5 primary goals of the water fund; 1) a balanced water fund operating budget each year 2) minimum budget of $400,000 for Water Plant capital, 3) the annual minimum recommended water fund reserve shall be met in the 3-year cash flow projection, 4) an annual General Fund transfer of approximately $1 million is to be made, 5) water main replacement to begin in 2020/21.

Mr. Braiman said water rate consumption and thus revenues, are significantly dependent on weather. Since 2016, new wholesale customers (Kenilworth/Golf; North Maine in 2020) have been added, eventually increasing wholesale volume by 40% with a projected $1.3 million in new net revenue beginning in 2020. However, continued investment in the Water Plant and the Village’s distribution system is necessary and may drive the domestic rates up in future years.

IV. Sewer Fund

Mr. Braiman reviewed the FY 2017 Sewer Fund Expenses and the 2018 Sewer Fund CIP, identifying the critical or recommended projects. There is no projected sewer rate increase in 2018 as the Village intended that the reserve be drawn down over time to pay the debt service for the $24 million sewer improvement program.

Mr. Braiman said the 2018 Budget is presented on September 26, 2017. There will be a budget workshop on October 3, 2017 and additional budget workshops scheduled if necessary in early November.

V. Public Comment

President Bielinski noted there was no one present to speak.

VI. Adjournment

Trustee Sullivan moved to adjourn the meeting at 10:30 p.m., seconded by Trustee Leonard. There was no further discussion on the motion. All voted aye, the motion carried.

https://www.wilmette.com/download/agendas_and_minutes/committee_of_the_whole/minutes/2017/C-O-W-8-28-17-2.pdf