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HomeMy WebLinkAboutMinutes - 12/03/2018 - Finance and Personnel CommitteeFINANCE AND PERSONNEL COMMITTEE Monday, December 3, 2018 Municipal Center Classroom, 5:30 PM Call to Order: The meeting was called to order at 5:30 p.m. Roll Call: Deputy Clerk Meadows called the roll. Roll call: Members present: Chairman Curry, Alderman Schaefer and Alderman Mihevc. Also in attendance: Finance Director Lynch, Public Comment: None. Motion to approve the November 12, 2018 Finance and Personnel Committee meeting report. Alderman Curry reported that the minutes were amended as there was an error on the first paragraph on page three under the discussion titled "Revenue Sources". Alderman Curry asked if the Committee Members had any other comments regarding the meeting minutes under consideration. The Committee Members offered no comments. A Motion was made by Alderman Mihevc and seconded by Alderman Schaefer to approve the November 12 2018 Finance and Personnel Committee meeting report as amended Roll call: Vote: 3 ayes: Alderman Mihevc, Alderman Schaefer, and Alderman Curry, 0-nay, 0-abstained. Motion carried. Revenue Sources -Discussion and Recommendation Alderman Curry opened the continuing discussion regarding increasing the Simplified Municipal Telecommunication Tax. Finance Director Lynch reported that currently the City's telecommunication tax rate is at 1% and this year generated $129,000 in revenue. Alderman Schaefer inquired if the annual revenue has remains constants over the years. Finance Director Lynch replied that the revenue stream has decrease over the last few years in part due to the fact that many people no longer have landlines. She went on to report that in FY-16/17 the Telecommunication Tax revenue was $143,000. Alderman Schaefer asked if the revenue stream would be impacted by any State regulations. Finance Director Lynch replied at this time she is unaware of any changes with respect to the State's collection and distribution of the telecommunication tax. She noted that the State does charge municipalities a %% administration fee. There was some discussion with respect to the public prescription if the City were to increase the Telecommunication Tax from 1% to 6%. 6% is the average tax imposed by the majority of the surrounding communities. Alderman Curry suggested increasing the tax from 1% to 3% which would double the current revenue stream and aid in making up for the loss in revenue with respect to maintaining a flat property tax. In addition, this is a tax based on personal usage not on the assessed value of one's home. The Committee Members discussed recommending to the full City Council an increase to the Telecommunication Tax. Finance Director Lynch directed the Committee Members attention to the preliminary CIP worksheet drafted by Administrator Morefield which depicts the fund balances as of April 30, 2018. She reported that the Capital Improvement Fund balance is $212,721. However, the fund balance is depleted after all the capital improvements that should be completed in the next fiscal year are funded. Finance Director Lynch continued on to discuss the General Fund balance which is $7,266,958, She noted that the General Fund balance has an $80,000 shortfall which conflicts with the City's Fund Balance Policy. Finance Director Lynch noted that once the City fails to maintain a reserve of 120 days of operating expenses they required to draft a plan to replenish the funds. The Committee Members discussed in length increasing the Home Rule Municipal Retailers' Occupation Tax, A Motion was made by Alderman Schaefer and seconded bvAlderman Mihevc to recommend to the full City Council an increase in the Telecommunication Tax by 2% bringing the total to 3% and increasing the Home Rule Municipal Retailers' Occupation Tax and the Home Rule Service Occupation Tax by'/a% bringing the total to %%. Roll call: Vote: 3-ayes: Alderman Schaefer, Alderman Mihevc and Alderman Curry, 0-nays, 0-abstained. Motion carried. There was some discussion with respect to a previous conversations regarding imposing a Transfer of Property Tax. However, this type of taxation would require a referendum on an upcoming ballot. In addition, the Community Development Committee has already investigated this matter and decided not to move forward with a recommendation to the full City Council, Staff Reports Finance Director Lynch reported that residents may now view their water bills via the City's website. Any Other Business Alderman Curry reported that he had sent Director Martin his comments regarding the Economic Incentive Policy, Alderman Schaefer and Alderman Mihevc noted that they will also sent their comments to Director Martin. This matter will be discussed during on upcoming Finance and Personnel Committee Meeting, Alderman Curry commented on the fact that 2019 Committee meeting schedule may need to be amended. Motion to adjourn from the meeting There being no further public business to discuss, a Motion was made by Alderman Schaefer and seconded by Alderman Curry to adiourn from the public meeting at 6:20 p.m. Roll call: Vote: 3-ayes: Alderman Schaefer, Alderman Mihevc and Alderman Curry, 0-nays, 0-abstained, Motion carried. Respectfully submitted, Debra Meadows, Deputy City Clerk Reviewed and approved this 7 day of FR&PWRY 20184 Alderman Curry, Ch