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HomeMy WebLinkAboutPacket - 04/01/2002 - City Council A G E N D A REGULAR CITY COUNCIL MEETING Monday, April 1, 2001 7:30 P.M. 1. Call to Order 2. Roll Call 3. Pledge of Allegiance 4. Presentation: McHenry Zone Skate and Bike Park $60,000 Donation 5. Public Hearing: City of McHenry Tax Increment Financing District 6. Public Input Session – 10 Minute Limitation 7. Consent Agenda:  Resolution designating April 7 – 13, 2002 as International Building Safety Week;  Recommendation to hire Bradford Fink as Assistant Director of Public Works ;  Ordinance granting Lot Width Variance/Conditional Use Permit to Cornerstone Material Recovery, Inc.;  Ordinance approving Special Service Area No. 2, Riverside Hollow Subdivision;  Water and Sewer Billing Discrepancy Policy;  Request from Inland Real Estate Development for Release of Letter of Credit for Olde Mill Ponds Subdivision in an amount not to exceed $350,000;  Purchase Order for Sioux Lane Water Tower Pier Repairs to Consolidated Concrete Restoration, not to exceed $5,320;  Approval of City Council Meeting Minutes: February 11, 2002 and February 18, 2002; 8. Request from Resident Cindy Sullivan for the Temporary Use of Veterans Memorial Park for a Noon Prayer Service to observe National Day of Prayer, Thursday, May 2, 2002, and to Waive all associated fees. 9. Request for use of Petersen Park by the McHenry Township Fire Protection District for a Benefit Concert on Saturday, June 15, 2002 and to Waive all associated fees. 10. Request for Fence Variance to the Corner Side Yard at 4740 Loyola Drive. 11. Request for Variance from Horizon Pipeline Company for three buildings on one Zoning Lot. 12. Request to add Parking on North Riverside Drive. 13. Employee Health Insurance Renewal for Fiscal Year 2002/2003 14. Authorization to send letters to Unincorporated Property Owners regarding Annexation. 15. Year 2002 Tag Days 16. Mayor – Statement and Reports 17. Committee Reports 18. Department Head Reports 19. New Business 20. Executive Session: Property Acquisition 21. Adjournment Posted and Mailed: March 27, 2002 C O N S E N T A G E N D A The Consent Agenda for the April 1, 2002 City Council meeting consists of the following items:  Resolution designating April 7 – 13, 2002 as International Building Safety Week;  Recommendation to hire Bradford Fink as Assistant Director of Public Works ;  Ordinance granting Lot Width Variance/Conditional Use Permit to Cornerstone Material Recovery, Inc.;  Ordinance approving Special Service Area No. 2, Riverside Hollow Subdivision;  Water and Sewer Billing Discrepancy Policy;  Request from Inland Real Estate Development for Release of Letter of Credit for Olde Mill Ponds Subdivision in an amount not to exceed $350,000;  Purchase Order for Sioux Lane Water Tower Pier Repairs to Consolidated Concrete Restoration, not to exceed $5,320;  Approval of City Council Meeting Minutes: February 11, 2002 and February 18, 2002; Attachments CONSENT AGENDA TO: Mayor and City Council FROM: John A. Lobaito, City Administrator FOR: April 1, 2002 Regular City Council Meeting RE: Assistant Director of Public Works Pursuant to the promotion of Dan Marcinko to Director of Public Works, at its January 7, 2002 meeting, the City Council authorized staff to advertise for the position of Assistant Director of Public Works. From eleven applications received, four candidates were interviewed. Upon review of the qualifications and backgrounds of the candidates, Director Marcinko and I recommend Bradford Fink for the position of Assistant Director of Public Works at a salary of $58,949, Grade 19, Step 5, with ten-days vacation the first year. A copy of his resume is attached. Mr. Fink has six-years of municipal engineering inspection experience with the Village of Palatine giving emphasis to customer service. His success at Palatine combined with his advanced knowledge in computer applications and commitment to customer service will be an asset to McHenry. It is recommended that the City Council authorize the hiring of Bradford Fink in the position of Assistant Director of Public Works at Grade 19, Step 5, subject to the successful completion of a pre-employment physical. Mr. Fink is available to start no sooner than April 16, 2002. mmg Attach. AGENDA SUPPLEMENT TO: Mayor and City Council FROM: John A. Lobaito, City Administrator FOR: April 1, 2002 Regular City Council Meeting RE: Renewal of Employee Health Insurance Plan for 2002/2003 Plan Year RECOMMENDATION: 1) Approve the renewal of the medical administrative and excess insurance portion of the plan as represented in the final Benefits Systems and Services, Inc. quote, Table A. 2) Approve the internal charges outlined in Table B for medical coverage and Table C for dental coverage (summarized in Table D). 3) Allow a delay in implementation for retirees and COBRA participants until May 1, 2002. The present health insurance plan covering City of McHenry employees expires March 31, 2002. The City Council must consider the renewal quotation for the medical plan’s administrative and excess insurance costs, set the plan’s internal medical and dental charges, and address implementation of the new charges for retirees and COBRA participants. Overview The City’s health insurance plan contains a medical, vision, prescription card, and dental benefit provision. The vision, prescription and dental components are entirely self-funded. The medical portion, which is by far the most costly portion, is a hybrid plan with the city responsible for self-funding a primary layer of medical claims and excess insurance purchased for claims exceeding the primary level. There are two types of excess coverage utilized. First, “specific” excess coverage kicks-in when claims for individual participants exceed $50,000. In a typical year, only one or two claims exceed the specific layer. Second, am aggregate attachment provides an overall layer of protection for the medical portion of the plan. The aggregate excess insurance applies when the city’s total claims cost meets the aggregate attachment level. For the past year, the aggregate was approximately $876,500. Historically, the aggregate has been set at 125% of the actual expected claims as determined by the insurance company’s actuary. By design, the insurance company has a “cushion” built in so that the aggregate excess coverage would only be utilized in a very poor claims year. Medical Plan Administrative and Excess Insurance Renewal Over the past several weeks, Scott Smiricky the Health Insurance Broker for the City of McHenry has been active in the market obtaining renewal quotes. Fortunately, the quotes have been more favorable than last year’s increase of approximately 38%. Table A depicts various quotes obtained. The city’s maximum exposure level for all costs (far right column) depicts an increase of approximately 1.8% when compared to the current year. The city’s aggregate attachment, or maximum claims-exposure level, actually decreases 9.5%. This means that the city would be responsible for cumulative claims up to $872,289 before the excess coverages takes over. The cost for the specific attachment would increase 12.4% to $193,437. Internal Charges Medical The attached schedule in Table B depicts how the internal charge for health plan participants is determined. The schedule provides a breakdown of the internal charge for fixed medical costs per participant, medical claims, vision, prescription, and reserve amounts. In keeping the benefit level constant from the prior year, the internal charge would amount to $372.29 for single coverage and $873.06 for family coverage. This represents increases of 14.5% and 12.8% in the single and family rates respectively. However, these rates are more favorable than the original budget, which projected increases of 25% for both rates. Dental As stated earlier, the dental portion of the plan is 100% self-funded with a Third Party Administrator (TPA) managing the program. Table C depicts the recommended monthly internal dental charge of $25.69 for single coverage and $68.95 for family coverage. Participants electing family coverage are required to contribute a portion of the internal charge. Presently, this contribution is $18.15 per month. It is recommended that the contribution increase by 10% to $19.97 per month. For participants electing both medical and dental coverage, the total internal charge is $397.98 for single coverage and $942.91 for family coverage. Implementation of Internal Charges for Retiree and COBRA Participants Retiree Coverage The health program currently allows retirees and former employees under COBRA voluntarily to elect to participate in the program with full benefits. However, these elective participants are required to pay the entire premium amount. Historically, an average of approximately six retirees has elected to participate in the city’s health program at any one time. Staff is recommending the implementation of new charges for retirees and COBRA participants for the May 2002 billing, which will allow time to notify retirees of the imminent change. Recommendation 1) Approve the renewal of the medical administrative and excess insurance portion of the plan as represented in the final Benefits Systems and Services, Inc. quote, Table A. 2) Approve the internal charges outlined in Table B for medical coverage and Table C for dental coverage (summarized in Table D). 3) Allow a delay in implementation for retirees and COBRA participants until May 1, 2002. mmg Attach. FINANCE/PERSONNEL COMMITTEE TO: Finance/Personnel Committee FROM: John A. Lobaito, City Administrator FOR: March 27, 2002 Finance/Personnel Committee Meeting RE: Renewal of Employee Health Insurance Plan for 2002/2003 Plan Year The present health insurance plan covering City of McHenry employees expires March 31, 2002. Consequently, the Finance/Personnel Committee will need to discuss renewal options and the quotes received, as well as establishing the internal health insurance rates charge to the user departments for plan participants. Subsequently, the City Council must consider the renewal quotation for the medical plan’s administrative and excess insurance costs, set the plan’s internal medical and dental charges, and address implementation of the new charges for retirees and COBRA participants. Overview The City’s health insurance plan contains a medical, vision, prescription card, and dental benefit provision. The vision, prescription and dental components are entirely self-funded. The medical portion, which is by far the most costly portion, is a hybrid plan with the city responsible for self-funding a primary layer of medical claims and excess insurance purchased for claims exceeding the primary level. There are two types of excess coverage utilized. First, “specific” excess coverage kicks-in when claims for individual participants exceed $50,000. In a typical year, only one or two claims exceed the specific layer. Second, am aggregate attachment provides an overall layer of protection for the medical portion of the plan. The aggregate excess insurance applies when the city’s total claims cost meets the aggregate attachment level. For the past year, the aggregate was approximately $876,500. Historically, the aggregate has been set at 125% of the actual expected claims as determined by the insurance company’s actuary. By design, the insurance company has a “cushion” built in so that the aggregate excess coverage would only be utilized in a very poor claims year. Medical Plan Administrative and Excess Insurance Renewal Over the past several weeks, Scott Smiricky the Health Insurance Broker for the City of McHenry has been active in the market obtaining renewal quotes. Fortunately, the quotes have been more favorable than last year’s increase of approximately 38%. Table A depicts various quotes obtained. The city’s maximum exposure level for all costs (far right column) depicts an increase of approximately 1.8% when compared to the current year. The city’s aggregate attachment, or maximum claims-exposure level, actually decreases 9.5%. This means that the city would be responsible for cumulative claims up to $872,289 before the excess coverages takes over. The cost for the specific attachment would increase 12.4% to $193,437. Internal Charges Medical The attached schedule in Table B depicts how the internal charge for health plan participants is determined. The schedule provides a breakdown of the internal charge for fixed medical costs per participant, medical claims, vision, prescription, and reserve amounts. In keeping the benefit level constant from the prior year, the internal charge would amount to $372.29 for single coverage and $873.06 for family coverage. This represents increases of 14.5% and 12.8% in the single and family rates respectively. However, these rates are more favorable than the original budget, which projected increases of 25% for both rates. Dental As stated earlier, the dental portion of the plan is 100% self-funded with a Third Party Administrator (TPA) managing the program. Table C depicts the recommended monthly internal dental charge of $25.69 for single coverage and $68.95 for family coverage. Participants electing family coverage are required to contribute a portion of the internal charge. Presently, this contribution is $18.15 per month. It is recommended that the contribution increase by 10% to $19.97 per month. For participants electing both medical and dental coverage, the total internal charge is $397.98 for single coverage and $942.91 for family coverage. Implementation of Internal Charges for Retiree and COBRA Participants Retiree Coverage The health program currently allows retirees and former employees under COBRA voluntarily to elect to participate in the program with full benefits. However, these elective participants are required to pay the entire premium amount. Historically, an average of approximately six retirees has elected to participate in the city’s health program at any one time. Staff is recommending the implementation of new charges for retirees and COBRA participants for the May 2002 billing, which will allow time to notify retirees of the imminent change. Recommendation 1) Approve the renewal of the medical administrative and excess insurance portion of the plan as represented in the final Benefits Systems and Services, Inc. quote, Table A. 2) Approve the internal charges outlined in Table B for medical coverage and Table C for dental coverage (summarized in Table D). 3) Allow a delay in implementation for retirees and COBRA participants until May 1, 2002. mmg Attach. ORDER OF PROCEEDING TAX INCREMENT FINANCING PUBLIC HEARING MONDAY, APRIL 1, 2002 , 7:30 PM 1. Call Public Hearing to Order Mayor Althoff 2. Explanation of Public Hearing Kathleen Field Orr, Esq. and Legal Notices of Hearing 3. Mayoral Comments and Report of Mayor Althoff Joint Review Board 4. Review: Lisa Lyon, A) Tax Increment Financing Overview Trkla, Pettigrew, Allen & Payne, Inc. B) Housing Impact and Eligibility Study C) Redevelopment Project Plan 5. Questions/Answers A) City Council B) Audience 6. Motion to Close the Public Hearing 7. Next Step Kathleen Field Orr, Esq. PUBLIC HEARING TO: Mayor and City Council FROM: John A. Lobaito, City Administrator FOR: April 1, 2002 Public Hearing RE: City of McHenry Tax Increment Financing District INTRODUCTION The Public Hearing for the establishment of a Tax Increment Financing Plan is one of the last steps in the process of creating a Tax Increment Financing Redevelopment Area. The purpose of the Public Hearing is to provide the general public with an opportunity to participate in a public discussion of the proposed Tax Increment Financing (TIF) District. Tax Increment Financing is a tool for local governments to take a proactive role in “jump- starting” the more economically sluggish parts of the community. Revenue generated from the TIF District is reinvested in the area through economic incentives to encourage development and expansion of businesses. Without the TIF benefits, the city risks a further decline in the economic assessed valuation growth of the area and potentially sales tax revenue. The McHenry City Council is considering a TIF District in the downtown area in part to improve the historically modest growth in equalized assessed valuation in the area. In addition, there are other benefits to the community, which include increased property values, private investment and development, job retention, and economic stimulation outside the TIF District boundaries to name a few. The City of McHenry continues to explore potential development projects within the district boundaries. One of these projects is the Riverwalk. This project is independent to the creation of the TIF District. Although the TIF may provide the financial vehicle to build the Riverwalk, the City Council is currently in the preliminary investigation of the feasibility of the project. Grant funds, private donations, and public monies have been secured to pay for the preliminary work. To date, over $1,000,000 has been committed to this project. BACKGROUND Feasibility Study: The process began on October 29, 2001 when the City Council passed a Resolution authorizing a Feasibility Study to determine if the defined area legally qualifies as a Tax Increment Financing District (TIF). Under the TIF Act, the defined area qualified as a Conservation Area. The area (map attached marked Exhibit B) met nine of the thirteen factors set forth in the act. One of the most relevant factors was the lagging rate of annual growth of the total equalized assessed valuation. P ublic Meeting: On January 14, 2002, a public meeting was conducted to advise the taxing districts, taxpayers that own property in the proposed Redevelopment Area, and residents residing within the project area, of the city’s intent to prepare a Redevelopment Plan. The primary purpose of the meeting was to receive comments from the public on the project. Notices of the meeting were mailed to all affected groups. Review of TIF Redevelopment Plan: At its February 4, 2002 meeting, the City Council reviewed the TIF Redevelopment Plan. The Redevelopment Plan responds to the requirements of the Tax Increment Allocation Redevelopment Act. The document provides a “roadmap” for the city to guide improvements and activities within the TIF Project Area. The plan includes a generalized land use plan for the area, specifies development and design objectives for the TIF area, and includes an anticipated budget. The City Council also passed an ordinance establishing a public hearing date for the TIF Redevelopment Area and Plan. Joint Review Board: The Joint Review Board (JRB) membership consists of all the affected taxing districts. Each taxing entity has one representative on the board. In addition, a resident residing in the Redevelopment Area serves on the board as the public member. The JRB met on February 26, 2002. Minutes of the meeting are attached. The board’s purpose among other things is to review the Eligibility Study and to make a recommendation to the City Council on whether a TIF District is warranted. The board unanimously recommended to the City Council that a TIF District be established. Notices: To comply with the TIF Act, numerous public notices must be provided to the public to encourage participation in the process of developing a TIF District. In addition to the steps outlined above. Certified mailings giving notice of the April 1, 2002 Public Hearing were mailed to all owners in the Redevelopment Area and persons on the Interested Parties Registry on file in the City Clerk’s office. In addition, residents in the Redevelopment Area and owners within 750-feet of the Redevelopment Area, were notified of the Public Hearing by regular mail. Lastly, two public hearing notices were published in the Northwest Herald on two separate occasions. Project Area Boundary: Map attached marked Exhibit B. -2- ACTION BY THE CITY COUNCIL Within 14-days, but no more than 90-days, from the Public Hearing date, the City Council must take action on the following ordinances to establish a TIF District: 1. An Ordinance approving the Downtown Redevelopment Project and Plan for the Redevelopment Project Area. 2. An Ordinance designating the Tax Increment Redevelopment Project Area a Redevelopment Project Area, pursuant to the TIF Act. 3. An Ordinance adopting Tax Increment Allocation Financing for the Redevelopment Project Area If the City Council decides to proceed with the creation of a TIF District, the City Council, by motion, should direct staff to prepare the referenced ordinances for City Council action. mmg -3-