HomeMy WebLinkAboutMinutes - 11/10/2014 - Finance and Personnel Committee �;
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FINANCE AND PERSONNEL COMMITTEE
4:00 PM,Monday,November 10, 2014
Aldermen's Conference Room
Call to Order
Chairman Aldel-man Wimmer called the meeting of the Finance and Personnel Committee to order at 4:10
PM. Other committee members present: Alderman Geri Condon, Alderman Jeffrey Schaefer. Also in
attendance: Mayor Susan Low, City Administrator Derik Morefield, Deputy City Administrators Martin
and Hobson, Fi�lance Director Carolyn Lynch, and Executive Assistant Marci Geraghty
Public Attendance: Scott Curry, 5802 Amherst Court,McHenry, IL 60050
Public Input
Mr. Scott Curry addressed the committee regarding his concerns about the proposed 1.9% increase to the
city's tax levy and expressed that in his opinion the city should address the real problem of business
retention. Replying to Mr. Curry's comments, Alderman Condon stated economic development is a
priority of the city; we are controlling things we can control however we cannot control how a business is
`-- operated or make people shop there. Alderman Condon added the city has no recourse when it comes to
paying for statu�ory and contractual obligations that require local funding.
Discussion on proposed 1.9% or$88,700 increase to 2014 Property Tax Levy
Chairman Alderman Wimmer stated the purpose of the meeting was to continue the discussion regarding
a proposal to increase the 2014 property tax levy by 1.9% or $88,700. Chairman Wimmer gave the floor
to City Administrator Morefield.
Mr. Morefield presented a spreadsheet depicting the 2014 Property Tax breakdown by government unit
based on a home valued at$200,000 noting the City of McHenry is only 7.15% of the total taxed amount.
The proposed increase would amount to an additional $26.58 per year in taxes for the owner of the same
home.
Mr. Morefield explained the city's property tax levy has remained frozen or flat for past three budget
years. In those years the city did not take advantage of the PTELL - limited inflationary increases on
property taxes—which would have resulted in a total of$659,038 in additional revenue. During the same
period(2011, 2012, 2013) and in spite of reductions in personnel and capital equipment expenditures, the
city's general fund budget has gradually increased for various reasons such as the general cost of goods
and services, personnel wage increases for three collective bargaining units, and employee insurance to
name a few.
An overview of cost reductions in the General Fund from 2007-2014 was presented. Mr. Marefield stated
during this time the city reduced the number of full time employees from 154 to 133; annually began
�. refunding MFT Bonds for a savings of$100,000 per year; and, reduced expenditures in supplies, training,
travel, and overtime. In addition capital equipment expenditures for vehicles, equipment, etc were frozen
from 2007-2010 and non-union employees received no step increases for four consecutive years.
At this time, the estimated increase to the FY 2015/16 budget is $402,149. Looking ahead in the budget
process for FY 2015/16, Mr. Morefield said he is concerned about the city's ability to fund much needed
street improvements; anticipated contractual increases in Unit 1, Unit II, and Local 150 wages; employee
health insurance; police pension contributions, mandated ADA improvements to city parks and facilities,
� and 20°/o local �natch obligations for STP grant funding. He is also concerned about maintaining the
conservative police and public works vehicle replacement program that was re-implemented. Mr.
Marefield concluded by stating to maintain a flat tax, the city will most likely be forced to reduce CIP
expenditures.
Chairman Wimmer opened the floor for questions.
Alderman Schaefer asked if MFT funds can be used to pay for STP road programs. Mr. Morefield
answered yes however it is not recommended and explained the amount of MFT dollars the city receives
has been trending down. Using MFT dollars to fund STP programs will reduce the amount available to
pay for road salt, annual infrastructure maintenance, and services provided to city residents.
Alderman Condon asked if potential increase in union wages was included in the information provided to
the committee. Mr. Morefield said Unit II was negotiated this year and is included in the information
however Unit 1 and Local 150 contract negotiations will begin next year.
Alderman Condon asked if budgeted expenditures for park improvements are mandated by the state or
federal governments. Mr. Morefield said yes, an accessibility compliance audit was performed and
requires the city to make approximately $100,000 in ADA improvements of which $20,000 is included in
this year's budget. Deputy City Administrator Hobson added there is no deadline to complete the
improvements however the city must prove it is making progress to complete the goal.
Alderman Schafer made a motion, seconded by Alderman Condon to send the proposed 1.9% increase to
the city's tax levy to the full City Council for consideration within the timeframe mandated by state
� statute.
Aye: Schaefer, Condon, Wimmer
Nay: None
Absent: None
Motion carried
Finance Director Lynch stated the proposed levy will be presented to the City Council on December 15L
and a public hearing will be held on December 15`�'.
Adjournment
Alderman Condon made a motion, seconded by Alderman Schaefer to adjourn the meeting.
Aye: Condon, Schaefer,Wimmer
Nay: None
Absent: None
Motion carried
The meeting was adjourned at 4:45 PM.
Respectfully submitted,
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Alderman Richard V. Wimmer