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HomeMy WebLinkAboutPacket - 04/29/2013 - City CouncilFinance and Personnel Committee March 11, 2013 Page Four plan is to pay him at least $280,000 by August 31st and Mr. Morefield answered yes, at least $280,000 and then he will be due whatever the difference is at the end of our fiscal year. Alderman Schaefer asked if this is cross-checked against state of Illinois numbers and what is the length of the agreement. Mr. Morefield answered the term of the agreement is 20 years or when the qualified development costs are paid. However an additional dealership could be added, which would increase the term of the agreement. He also said the city has authorization from the Illinois Department of Revenue to obtain Gary Lang, Inc. sales tax dat a and development costs. To summarize, in FY13/14 the city will be able to meet the terms of the agreement and reimburse Gary Lang, Inc. through funds budgeted in FY12/13 ($105,000) and by proposing funds in the FY13/14 budget ($400,000) without the need to reduce the General Fund balance.  A project included in the CIP not funded in FY13/14, but one the committee should be aware of is the proposed aquatic recreation facility. The Parks and Recreation Committee discussed the project and a concept plan has been created for the center to be built on the Knox Park property. If approved in FY13/14, staff will request authorization to release money from the Recreation Center Fund to pay for design work. Alderman Schaefer said he is often asked if our revenues increase from one year to the next, why do we always have to spend it or budget to spend it. He also asked if any large areas of expense reductions are proposed in the FY13/14 budget. Mr. Morefield said we do not have to spend every dollar we collect. Increases in revenue could be deposited in the fund balance each year however this is really a reserve fund and not a savings account. A reserve is held for emergencies – any extra should be used to benefit the public, which is why we collect it. Mr. Morefield added people are also concerned about increases in their property taxes, which the Council has frozen for the past three years. The largest project in the CIP that will be addressed in the future is the road program. Although there is not a large CIP project in the proposed FY13/14 budget, we will have to begin dedicating money from the General Fund for road improvements. Alderman Schaefer noted last year a capital expenditure line item for road improvements was included in the budget and he asked if there is a line item for roads in FY13/14. Ms. Lynch said in the past MFT funds have been used to pay for road projects. In FY13/14, we are moving towards creating a true CIP where we will use General Funds to pay for road programs. Mr. Morefield added in the CIP, there is an unfunded item for $30M. The goal is to start funding that item for non-multiple-funded road improvements. Alderman Schaefer agreed the proposed budget is conservative. Alderman Schaefer asked if the proposed budget contains any major changes from last year. Mr. Morefield said no, all funds are basically unchanged from last year. Chairman Alderman Wimmer said the only substantial increase he saw was for garbage bags. Mr. Morefield said the Police budget comprises almost $8M of an $18M General Fund budget and therefore, that is where you will find most of the changes. However, the Police Department has done a great job of cutting back and identifying what they really need to operate efficiently. Ms. Lynch noted in the past few years our health benefit costs have increased 5-6% compared to the industry average is 12%. Mr. Morefield stated a significant cost increase is reflected in the development expense line item in the Finance Department budget for the Gary Lang, Inc. agreement. Also, the Capital Equipment Fund was reduced slightly from last year. Alderman Schaefer asked where the savings for not replacing the Director of Parks and Recreation is reflected in the proposed budget. Mr. Morefield said we are currently without a Finance Director and will be without a Director of Parks and Recreation. Mr. Morefield said Bill Hobson will continue to oversee the P&R Department, which will result in the same quality of work, a bit more efficiently as there will be one less person in the chain of command, and a savings in salary and benefits will be realized. However in the future, we may be able to add programming staff.