HomeMy WebLinkAboutMinutes - 3/2/1998 - Finance and Personnel Committee �
FINANCE COMMITTEE MINUTES
March 2, 1998
Members Present: Chairman Aldermand Murgatroyd, Alderman Baird, Alderman
McClatchey
Others Present: Mayor Cuda, City Administrator Lobaito, City Clerk Althoff,
Alderman Bolger, Alderman Glab
Alderman Murgatroyd opened the meeting at 7:55 P.M. stating the purpose of this
evening's meeting was to continue discussion on the 1998-99 budget. City
Administrator Lobaito noted previous committee action had been incorporated into
the current budget projections.
City Administrator Lobaito also distributed a salary account sheet delineating the
$88,000 increase between the 1997 fiscal year-end salaries and the 1999
projected year-end salaries for the Parks and Recreation Department. It was noted
543,000 of the total amount was previously allocated to the Streets Division. The
balance of the 588,000 figure is attributable to increased costs.
L.. Chairman Alderman Murgatroyd noted that although the current 1998-99 projected
revenues have been increased by 5500,000, the projected 1998-99 expenditures
reflect an increase of 5600,000. City Administrator Lobaito explained the total
expenditures currently projected for the 1998 year end is approximately $74,000
less than the projected 1998 year end revenues. He cited the cost reduction
adjustment for the Petersen Farm purchase as the attributable factor.
The Water/Sewer Fund is still reflecting a negative balance even with the
committee recommended project reductions and eliminations of approximately
5280,000. Further discussion noted although the water/sewer revenues are
anticipated to increase over the next three years because of the recently initiated
rate increase, numerous capital and maintenance projects are being budgeted for
this fiscal year. In response to an inquiry Chairman Alderman Murgatroyd noted
21 % of the water/sewer operating expense is attributable to salary expenditures.
City Administrator Lobaito also stated the 1997-98 budget reflected only S 180,000
in Capital Project expenditure as compared to the originally projected 1998-99
expenditure of 5750,000. The current projected 1998-99 water/sewer capital
expenditures total $470,000.
WATER/SEWER FUND
City Administrator Lobaito noted the line item for Summer Help in account #401
Salaries was reduced from 59,200 to 57,000. In addition the Sick Pay line item for
`- each department has been consolidated within the Administrative Department's
Finance Committee Meeting
� March 2, 1998
Page Two
account #402 Salaries. This amount has also been reduced by 50%. Some
discussion followed regarding the increase in overtime from $16,500 to $20,000.
City Administrator Lobaito stated the 520,000 was more in line with the 1997-98
year end projected overtime expense.
Some discussion followed regarding the substantial increase in the City of
McHenry's self-insured employee insurance program. City Administrator Lobaito
noted a 58% increase in medical claims experienced by the City in the 1997-98
calendar year. Aggregate insurance coverage costs increased proportionately. The
new allocated cost per single coverage is 5323 and the cost for family coverage is
$570. Employee health insurance costs are incurred by the City of McHenry. City
of McHenry employees currently pay a portion of the dental insurance coverage
cost. Additional quotes will be forthcoming.
In account #503, Professional Development, the line item Contracted Safety
Training was reduced from $700 to 5300. In account #527 Materials and Supplies
the line item Landscaping for Water Plants was moved to the Building and Grounds
department. Newly created account #537 Small Tools and Equipment, reflected a
reduction from $5,000 to $4,000.
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City Administrator Lobaito noted several projects had been eliminated from the
#700 account Capital Outlay including water main design for Green Street and
Beach Road and hand-held radios. The total expenditure amount for property
acquisition, specifically Eastwood Manor Water Company, was reduced. The
5350,000 original figure reflected the company's total cost and it is staff's analysis
an installment purchase is more realistic. The figure was therefore reduced to
S 100,000. Some discussion followed. City Administrator Lobaito noted a full
status report on Eastwood Manor's infrastructure condition, from city engineers,
Baxter and Woodman, would be forthcoming. In addition a full financial analysis,
by Harold Warren of Warren and Associates, will be conducted regarding the
purchase feasibility by the City of McHenry. An increase in Eastwood Manor's
current rate structure will be considered.
In response to Alderman Baird's inquiry the City Administrator stated he did not
believe current budget figures include the cost of connecting one street in the
McHenry Shores subdivision to the City of McHenry's water system. If budgeted
the cost would be expensed in the Streets Division as city crews would be
responsible for the projects completion. Some discussion followed.
Alderman Murgatroyd inquired as to the increase in cost of the water plant design
from $100,000 in the 1997-98 budget to $150,000 in the proposed 1998-99
� budget. City Administrator Lobaito stated the 5150,000 was a more realistic
Finance Committee Meeting
� March 2, 1998
Page Three
figure after staff's review of the project scope. Alderman McClatchey
recommended council consider competitive bidding on these projects including the
engineering costs.
The elevated storage tank figure of S 150,000 reflects the cost of two elevated
tank locations. City Administrator Lobaito noted staff will also, when appropriate,
draw these infrastructure needs to the attention of developers when negotiating
annexation agreements. Mayor Cuda recommended a meeting be scheduled with
representatives from the City of McHenry's engineering firm to assist in the
prioritizing of these water projects.
WASTEWATER DEPARTMENT
The overtime line item in account #401 , Salaries, was reduced from $16,000 to
S 15,000. Two additional employees are anticipated for approximately six months
of the fiscal year. The expansion of the South Wastewater Treatment Plant will
necessitate a fulltime operator requiring the additional hires. Account #556,
Sludge Disposal, was reduced from 5100,000 to 592,000. In account #700,
Capital Outlay, the Anne Street Lift Station expense was reduced as additional
costs will be expensed in the 1997-98 fiscal year. The Central Wastewater
� Treatment Plant expenditure was also reduced from 5600,000 to 5100,000 as per
staff's recommendation based on the information that the City will not be in a
realistic position to initiate this project until the Spring of 1999. Further discussion
followed regarding the need to evaluate the City's wastewater master plan and
determine whether to expand the Central Wastewater Treatment facility or to divert
flows to the South Wastewater Treatment Plant. Monies for further study have
been budgeted.
City Administrator Lobaito noted even after all the project eliminations and scope
reductions, a deficit of S 1 10,000 still exists in the Water/Sewer Fund.
POLICE
The line item, Sick Pay, in account #401 Salaries has been increased from 57,400
to 59,000 as staff has been informed of a planned retirement by one dispatcher
during the 1998-99 fiscal year. After some discussion staff was directed to
investigate the number of dispatchers, the budget reflects a total of nine (9) and it
is believed the number should be eight (8). Account #700, Capital Outlay, reflects
the reduction of the squad car purchase line item from 581 ,100 to 561 ,650
accounting for the committee's decision to purchase only three new squad cars for
the 1998-99 fiscal year. After some discussion regarding the Police Department's
current squad replacement program Alderman Baird recommended purchasing the
three squads, but retiring only two of the older squads having the highest mileage.
�.. He noted a better determination could then be made regarding the need to replace
squads based on mileage factors and repair costs. Two of the three new squads
should be designated as the spares. The committee concurred.
Finance Committee Meeting
March 2, 1998
� Page Four
Eliminated from account #700, Capital Outlay, was the Mobile Data Terminal
purchase of 55,000 and the outfitting of the Mobile Command Unit of 53,000.
ADMINISTRATION
City Administrator Lobaito noted all noncontracted salaries reflect a 3% increase.
The Sick Pay Line item reflects the consolidation of all the department's anticipated
retirement sick pay buy-back benefit at a 50% level. City Administrator Lobaito
also noted the as-yet to be budgeted Department Head Performance Review line
item explaining he'd like to conduct Department Head reviews in July or August
after budget approval. A pool of monies should be budgeted allowing for
department head performance raises in addition to any Cost Of Living raises
granted at the beginning of the fiscal year. This issue will be discussed in detail
when further personnel issues are addressed. In account #455, Boards &
Commissions Expenses, the EDC line item has been reduced from S 10,000 to
58,000 and the Police Commission/Contractual line item was increased from SO to
S 1,500 while the Police Commission Supplies line item was reduced from S 1 ,500
to S 1 ,000. The McHenry Area Youth Commission line item was also reduced to
the 1997-98 budget figure of 56,000 after some discussion regarding the City of
McHenry's insurance obligations for Executive Director Judy Shearer.
L
In account #503 Professional Development the Seminars and Conferences line item
was increased from $1 ,800 to $2,100 and the tuition reimbursement line item was
reduced from 57,000 to 54,000.
Some discussion followed regarding the legal firm of McAndrews and Cunabaugh's
request to increase their fees for handling the City of McHenry's traffic
prosecutions. City Administrator Lobaito noted these fees had not been increased
in five years. McAndrews and Cunabaugh are requesting an increase of
approximately 515/hour for a monthly fee of 56,800/month. Committee members
noted the traffic fine revenue hasn't increased over the past several years.
It was the consensus of the committee to increase the 520,000 budgeted amount
in account #520, Legal Fees/Contract Negotiations to 525,000 in light of the Public
Works Union Contract and the Police Departments Union Contract termination date
of April 30, 1999.
In account #700, Capital Outlay, the following line items were eliminated:
Computer Printer
Slide Projector
Computer Customer Service Software.
Line item Office Equipment was reduced from $5,000 to 53,000 and the Petersen
� Property expense was increased to reflect the Corlands lease of $2,500/month.
Chairman Murgatroyd initiated a discussion regarding how to expense the Petersen
Farm purch�ise. It was the consensus of the committee to divide the cost equally
between thE� General Fund and the Parks Developer ponation Fund.
Finance Committee Meeting
March 2, 1998
� Page Five
Mayor Cuda requested committee consideration of city resident Tom Evans request
to reduce his bi-monthly sewer bill. Mayor Cuda explained Mr. Evans had moved
to the Country Club Estates Subdivision from Anne Street. Mr. Evans received
both city water and sewer services at his Anne Street address for approximately
S 17.00/bill and now at his Country Club Estates address he receives only city
sewer service and pays a flat rate of $28.00/month. Mr. Evans feels he is paying
twice the amount for half the service. It was the consensus of the committee and
the two non-committee aldermen to uphold the City of McHenry's municipal
ordinance regarding flat sewer service. City Clerk Althoff was directed to inform
Mr. Evans of their decision in writing and provide Alderman Bolger with a copy of
the sewer rate formula.
Chairman Alderman Murgatroyd reminded the committee the next meeting would
be on Thursday, March 12, 1998 at 7:00 p.m. to discuss Personnel.
Motion by Baird, seconded by McClatchey to adjourn the meeting at 9:55 p.m.
Voting Aye: Baird, McClatchey, Murgatroyd
Voting Nay: None
Absent: None
,� The meeting was adjourned at 9:50 p.m.
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Steven Murgatroy , Fin ce Chairman
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