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HomeMy WebLinkAboutPacket - 05/07/2018 - Finance and Personnel CommitteeFinance and Personnel Committee May 7, 2018, 5:30 PM McHenry Municipal Center 333 S Green Street McHenry, IL 60050 AGENDA Call to Order. 2. Roll Call. 3. Public Comment: Persons wishing to address the Committee will be asked to identify themselves for the record and will be asked but are not required to provide their address. Public comment may be restricted to three -minutes for each individual speaker. Order and decorum shall be maintained at public meetings. 4. Motion to approve the April 2, 2018 Finance and Personnel Committee meeting report. 5. Review, discussion, and consideration of a Revolving Loan Fund application for the amount of $24,530 submitted by Love Bugs Day Care located at 2314 Route 120, and motion to place this item on the next available City Council meeting agenda. 6. Discussion of Purchasing Policy and procedures for Project Change Orders 7. Staff Reports. 8. Any Other Business. 9. Motion to adjourn the meeting. Next regularly scheduled meeting is June 4, 2018 The City of McHenry is dedicated to providing its citizens, businesses, and visitors with the highest quality of programs and services in a customer -oriented, efficient, and fiscally responsible manner. FINANCE AND PERSONNEL COMMITTEE Monday, April 2, 2018 Municipal Center Classroom, 5*30 PM 1. Call to Order: The meeting was called to order at 5:30 pm. 2. Roll Call: Chairman Alderman Curry, Alderman Schaefer. Absent: Alderman Mihevc. Also in attendance Director of Finance Lynch, Mayor Jett and Deputy Clerk Geraghty. 3. Public Comment: None. 4. Motion to approve the March 12, 2018 Finance and Personnel Committee meeting report. Motion by Alderman Mihevc, second by Chairman Schaefer to approve the March 12, 2018 Finance and Personnel Committee meeting report. Voting Aye: Mihevc, Schaefer, Curry Absent: None. Motion carried. 5. Motion to approve the March 26, 2018 Finance and Personnel Committee meeting report. Motion by Alderman Schaefer, second by Chairman Mihevc to approve the March 26, 2018 Finance and Personnel Committee meeting report. Voting Aye: Schaefer, Mihevc, Curry Absent: None. Motion carried. 6. Reconsideration of the City of McHenry Vehicle Sticker Program. Chairman Curry announced upon further review of the committee vote to forward to the Council a recommendation to terminate the vehicle sticker program, it was determined that this was not the proper time to eliminate the program. Chairman Curry recommended a motion be made to rescind the motion passed by the Committee February 19, 2018. Motion by Alderman Schaefer, second by Alderman Mihevc to rescind the motion made to forward to the Council a recommendation to terminate the vehicle sticker program. Finance and Personnel Committee Page 2 April 25 2018 Voting Aye: Schaefer, Mihevc, Curry Absent: Mihevc Motion carried. 7. Review of Classification and Compensation Study conducted by GovHR. Chairman Curry stated HR Manager Campanella was present to provide an update and answer questions regarding the Classification and Compensation Study. Chairman Curry questioned the 60 mile radius used for comparisons because in his opinion, 60 miles is far to drive for a job and not too many people would do that. The Chairman distributed a copy of an analysis he put together using communities within 25 miles of McHenry as opposed to 60 miles in the GovHR study. His analysis used information from the GovHR study for communities within 25 miles of McHenry as this is more reasonable and he eliminated the comparisons to General Fund budgets and revenues. He then determined under that scenario, which communities were the most comparable to McHenry. Algonquin remained the top comparable community but some of the others changed and Woodstock Algonquin, LITH, and Lake Zurich were in the top four. HR Manager Campanella noted that many communities did not respond to the GovHR survey and therefore, it was important to reach out further away from McHenry. Various point values were assigned to each factor in the survey and distance was a low value. Other determining factors had a higher point value. The survey took a collection of all point values and they were inserted into a graph to see how they compared. The result is still the same even if we remove a comparable community. HR Manager Campanella further stated that several employees are retiring and the city has had to re -advertise those positions because the salaries were too low and only a few or no applicants responded and many did not meet the qualifications. The city's pool of candidates include those who are currently employed however not many people will change jobs for less money. Alderman Schaefer asked if there was a difference in salaries between a department versus a district. HR Manager Campanella said the pool of applicants is the same. Districts provided less data to the study however the city needs to position itself to pay an equitable wage or we will lose people to districts and turnover costs the city money. Alderman Mihevc asked if we knew the trend in terms of fulltime staff over the last few years it seems the city is trying to do more with less and asked if we had hard numbers. HR Campanella said opening the Recreation Center skewed the trend. However, in terms of HR and Payroll, it takes the same amount of effort to service a part and fulltime employee. The city processes approximately 230 payrolls every pay period. The study only considers fulltime employees. The city has not eliminated as many positions as Finance and Personnel Committee Page 3 April 2. 2018 have been consolidated. Chairman Curry stated in his opinion there is no question that the salary ranges need to be updated. He further stated that many positions such as administrative assistants have many comparables listed in the survey versus other less common positions, which makes it difficult to get a hard average. HR Manager Campanella stated the communities either did not respond or did not have a similar position and GovHR was satisfied with the response rate. Chairman Curry asked who reviewed the job analysis questionnaires and HR Manager Campanella answered she and Department Heads reviewed them. Chairman Curry noted the study proposes a huge impact on personnel and he stressed the importance of being certain that the study is as accurate as possible. HR Manager Campanella stated there are 12 or 13 positions in green that will have an impact to the budget. There are just as many positions within the proposed range however many of those are employees who have been with the city over 10 or 20 years. Which is why there is a catch-up plan proposed in the study for long-term employees who would be at the bottom of the new range. HR Campanella explained the reason that some positions are proposed to increase over 10% is because those positions are underpaid. In response to Alderman Schaefer's question about eliminating employees during the economic downturn, Finance Director Lynch reported the city eliminated three positions with severance packages and three positions were not replaced due to retirements. Alderman Schaefer noted this action was intended to preserve many city jobs and asked if this is why so many positions are now underpaid. Director Lynch noted that for many years, salary increases were not considered. At Alderman Schaefer's requests, the Committee agreed that all salary ranges should be updated. Alderman Schaefer suggested the positions with proposed increases over 6% be reviewed again, and responsibilities clarified and the Committee agreed. HR Manager Campanella stated she would review the documentation and report her findings to the Committee. Chairman Curry asked about the timing when the ranges are amended. HR Manager Campanella stated in her experience, ranges are adjusted during the budget approval process. Once the ranges are caught -up, the impact to the budget should not be significant. Alderman Schaefer inquired about the two positions that are being paid more than the proposed range. HR Manager Campanella stated at this time, those salaries will not change. In conclusion, Chairman Curry summarized that the Committee agreed that salary ranges should be updated and that all immediate increases requested over 6% be reevaluated. Finance and Personnel Committee Page 4 April 2, 2018 S. Discussion on Staff Recommended Positions. HR Manager Campanella stated three new positions have been requested. In her opinion, the biggest need is the City Planner position. Chairman Curry asked if this position would be responsible for the Planning and Zoning Commission instead of Director Martin, and HR Manager Campanella answered yes and would report to Director Polerecky. Alderman Mihevc noted the study and proposed reorganization is a work in progress. Chairman Curry announced that positions approved after adoption of the FY 18/19 Operating Budget would require approval of a budget amendment. Alderman Schaefer noted the city previously had a city planner position and eliminated it. In response to Chairman Curry's questions, Director Lynch stated she thought the position was eliminated in 2008 adding the duties were assumed by other positions. Chairman Curry noted the city currently has positions in Community Development that did not exist in 2008, Economic Development Director, Economic Development Coordinator and Economic Development Assistant. Discussion ensued on past organizational changes that occurred in the Community Development Department, Alderman Mihevc said it would be helpful to see a current organizational chart by position with new positions and responsibilities included. Director Lynch stated the proposed positions were not included in the FY 18/19 draft budget because she and Administrator Morefield did not want to present an unbalanced budget. At this time, the new position(s) and compensation study together cannot be included in a balanced budget. Chairman Curry concluded that future discussions should take place with a review of the current and proposed organizational chart and if the Council agrees these positions are to be considered, a budget amendment would be appropriate. 9. Staff Reports None, 10. Any Other Business None. 11. Motion to adjourn the meeting. Finance and Personnel Committee Page 5 April 2, 2018 Alderman Schaefer made a motion, second by Alderman Mihevc to adjourn the meeting. Voting Aye: Schaefer, Mihevc, Curry Absent: None. Motion carried. The meeting adjourned at 6:50 pm. Respectfully submitted, Marci Geraghty, Executive Assistant/Deputy City Clerk Reviewed and approved this day of 2018. Alderman Scott Curry, Chairman City of McHenry 333 Green Street McHenry, Illinois 60050 Phone: (815) 363-2100 Fax: (815) 363-2119 www.ci.mchenry.il.us FINANCE AND PERSONNEL COMMITTEE SUPPLEMENT TO: Chairman Curry Members of the Finance and Personnel Committee FOR: May 7, 2018 Finance and Personal Committee FROM: Carolyn Lynch, Finance Director Douglas Martin, Director of Economic Development RE: Revolving Loan Fund request in the amount of $24,530 from Love Bugs, LLC at 2214 W. Illinois Route 120 ATT: 1. Loan Application AGENDA ITEM SUMMARY: The Finance and Personnel Committee is being asked to consider a request for $24,530 from Love Bugs, LLC located at 2214 W. Illinois Route 120, BACKGROUND: As established, the Revolving Loan Fund Program has provided loan proceeds to assist in the startup of a new business, expand an existing business, and update existing facilities to make the business more competitive, or provide an incentive for established businesses to relocate to the City. At the Finance and Personnel Meetings (8/7/17, 9/5/17, and 10/2/17) the criteria was defined for the Revolving Loan Fund Program and a new application was created. Currently there are three outstanding loans in the Revolving Loan Fund, Plum Garden $5,392, Utopian Roast $12,608, and Smith's Central Garage $44,652 leaving a current balance available to loan of $52,800. ANALYSIS: Staff received a Revolving Loan Fund application from Love Bugs, LLC forthe updates to the existing rental space including electrical, plumbing, painting, equipment, and signage as well as employee training. A personal loan has been obtained for the balance of the project. City of McHenry 333 Green Street McHenry, Illinois 60050 Phone: (815) 363-2100 Fax: (815) 363-2119 www.ci.mchenry.il.us Staff has been working with Bill Busse from First National Bank of McHenry, who conducted underwriting services for the proposed loan application. The analysis completed by Mr. Busse has been emailed to the committee because some of the information is confidential. After completing the underwriting process, Mr. Busse has recommended this loan for approval. The prime rate currently is at 4.75%. The Revolving Loan Fund Committee is being asked to consider the application submitted by Love Bugs, LLC for Revolving Loan funding the improvements and employee training at 2214 W. Illinois Route 120. Should the Committee choose to award funding, Staff is recommending a loan amount of $24,530, along with the following conditions: • A blanket security interest in the business assets (equipment, inventory, accounts receivable, intangibles, etc.) of Love Bugs, LLC; • An unconditional personal guarantee by Jacqueline Jezierski of the amount borrowed; • A requirement for submittal of a personal financial statement (Jacqueline Jexierski) & business financial statements from Love Bugs, LLC after the close of each fiscal year beginning in FY2018; • Loan to be repayable monthly over a five year terms 4.75% fixed rate (current prime rate) with no prepayment penalty; • City to buy back (we would assign) loan (by debit offset to demand deposit account) should payments become more than 60 days delinquent; • Request is subject to full City Council approval; • Loan documents must be fully executed within 30 days of City Council approval. in Name of :1J J-'. Jt j1 i 1.�� iz �,c. i.-S' i."�� P1L _•£, b t/ • - t J.. -.'��f • - y' 1 on Project: ``S__treet Address of i'roject {in City of McHenry] Dwnershlp5truc#ure {�} 1ot��jp Address of Owner{s) Erna[i Address Type of Business Bank Addt�ess {include City, State and Zip {Primary Contact Phone] State Name of B Zip Code Date Established Institution Project Description — Purpose of Request —Why undertaking the projectJrequesting Loan? ,1Si.., 1.ccoly Z a6ed 9�LL�8Z;9L8L sndu�e� a�PP� Wdb��Zb BLOZ 8Z ��W on Project: yment Impact: li Existing�rnpl2yees �. q positions Created_; Total Relocatia(DN (State primary reasons for relocation) Expansion Y/N (State primary reasons for expansion/primary reasons) for requesting loan) History and Description of Company and Principal (Fxampies of Community investment -Monetary and None Monetary, I.e.: Community Service; partnerships, causes supported, service organizations) information on Use of Project Funds: Land Acquisition i.and improvement Purchase and/or Remodel on Existing Building New Construction Purchase and/or Repair Machinery & Equipment Purchase Furniture & Fixtures Employee Training 7oral Project Cost $11 bW1Z.QC'S IN E abed 9�b��8£5686 sndtue� aIPPN WdK171. 860Z £Z �eW c.i 2 TAAAVtai.lobs Created and FTE lobs Created: E Jobs Created: FTE bs Retained: PTE Job etaina& 'AAA "AAA f � Retained (w%in first ?'years Insert date'aolt 16 )• • Total Capital Investment jw/In first 2 years (insert date'S1 �); Land Building S Equipment_ � Location of Slte ; . Underutilized building/land:;b."WW la> . 1L, ��, %2� Brownfield site: Downtown/West Route 120: Primary Justification for appticatian (i.e. Has conventional loan or other type of financing been considered?) Other types of investment vehicles being utilized? (Please list and include amount; term and any conditions associated.): Grants• so— nai/S( Bq� County Revolving Loan Fun Laan(Per Sales Tax Economic Benefit to City (One, five and ten-year estimates} (can be Increase in tax -base as wail if existing business): Yr.) ( Yr.) (10 Yr.) $ Property Tax $(� S $u1a� Income Tax $ $ $ • Consistent with goals of adopted City Council Economic Developgent Strategy: (Please state/list how (Be speclfic): ly State Filing Fee: $1QO non-refundable application fee and ail casts Incurred by the City will be the responslbitity ofthe applicant. � a6ed 9�6L58E�6$� sndwe� aiPp�i Wdy51Z6 8bOZ £Z JeW Furniture, Fixtures and Equipment Nsf approved Refrigerator $1750 Convection oven $2200 3 compartment sink $300 Chest freezer $S00 NSF approved dishwasher $1500 Xerox Machine $1300 To al Equipment $7550 Shelving $2500 Chairs $2080 Cribs $1200 Tables $2200 Total Furniture/Fixtures $7980 Total $15530 Training CDA training $4000 CPR Training $600 AIM DCFS Training $400 Tota I $5000 5 a6ed 9�6L58£5686 sndwe� aippr� Wdg5�Z6 860Z £Z �eW �*wl=N \r�N CONN g a6ed 9g6L58£g686 st�dute� a!PP�1 Wd9��Zb 8b4Z £Z JeW