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HomeMy WebLinkAboutx - November 12, 2014 COW (Special) SPECIAL COMMITTEE OF THE WHOLE MEETING November 12, 2014 The Special Committee of the Whole meeting was called to order by Mayor Kaptain at 5:00 p.m. in the Council Chambers. Present: Councilmembers Dunne, Gavin, Martinez, Powell, Prigge, Rauschenberger, Shaw, Steffen, and Mayor Kaptain. Absent: None. Discussion Regarding the Budget Schedule City Manager Stegall reviewed the current budget meeting schedule. He stated that the Tax Levy, TIF, and Utility Fund would be discussed at the next meeting and the Truth in Taxation and public hearings would be held in December. He noted that at this meeting staff would provide information on the budget process, the budget in brief, a General Fund overview, and the Capital Investment Plan. Budget in Brief City Manager Stegall noted the following three things to remember: He stated that overall the economy was becoming more positive than in years past. He cited a positive GDP, an increase in business spending and to housing starts, and favorable interest rates. He stated that there was a favorable borrowing environment and that the city council may consider borrowing funds to advance necessary street rehabilitation. He noted the relationship between the adopted strategic plan and the budget, stating the budget is driven by the plan. Finally, he outlined the challenges the city faced including street repairs, pension obligations, and health care costs. City Manager Stegall provided a review of Budget 101. He outlined budgeting concepts such as the budget is a policy document and that revenue and expenditures must balance. Further, the city budget utilized the departmental business plans from the strategic plan as a foundation for the budget. Finally, by state statute the city must adopt a balanced budget by the end of the year. Mr. Stegall outlined the seven different fund types: general fund; special revenue funds; enterprise fund; internal service fund; debt service fund and trust and agency fund and the restrictions on how each fund can be used. Also, he noted, that a budget allocation is not an authorization to spend and that the city council had final approval of expenditures. Committee of the Whole November 12, 2014 Page 2 General Fund Mr. Stegall provided a summary of total budget by fund type for 2014 and the proposed 2015 budget. The total proposed 2015 budget is $290,535,730 in comparison to the 2014 budget of $280,779,240. He outlined where the revenue comes from: property tax (21%), charges from services (20%), sales tax/income tax (17%), other/misc. (17%), services/excise (13%) and commodities (11%). He also gave an overview as to where the expenditures go: earnings and benefits (70%), contractual services (14%), pension (5%), and capital outlay (3%). City Manager Stegall reviewed the performance and the projections of the sales tax income, telecommunications tax, and the refuse fee. He also reviewed the solid waste rates and noted that the city, in comparison to surrounding communities, had received a favorable rate from Waste Management. There was discussion about the increase in housing starts and efforts in commercial development, availability of historical budget information on the website, and the legal requirement to adopt a balanced budget by the end of the year. Also discussed were the electricity and natural gas taxes and how they are collected, and the percentage the consumer pays versus the percentage of funds provided to the city. There was discussion regarding changes to the utility tax (electric and natural gas) and to put revenue previously generated by this tax back onto the property tax. The proposed property tax revenue for 2015 is $26,908,000 in comparison to 2014 estimate of $25,300,000. Mr. Stegall provided the City of Elgin’s tax rate to the other local taxing bodies including U-46, Kane County, Gail Borden Library and Elgin Township. The proposed tax levy would remain the same as 2014. The tax levy would be discussed in detail at an upcoming Committee of the Whole meeting. The proposed budget includes drawing down the cash reserves to make supplemental payments to the various pension funds. There was a discussion regarding making further supplemental payments to the pension funds. Under the strategic initiatives the following new positions were included: GIS Analyst, Public Safety System specialist, 911 Emergency Operators, and Development Engineers. There was discussion regarding how an unfilled, yet budgeted position, would be handled. In summary, the General Fund Revenues, have enjoyed moderate growth, the Riverboat Fund is no longer subsidizing the General Fund, and the Cash Reserves are being deployed to meet pension obligations. The General Fund Expenditures, in summary, will continue to be impacted by health care and pension costs, and expenditures are being managed well at the department level. Finally, the General Fund is in a position to take on a moderate amount of debt to impact future capital needs. Committee of the Whole November 12, 2014 Page 3 Capital Investment Plan City Manager Stegall reviewed the types of expenditures that would come from the capital investment plan including roadway improvements, utilities, facility maintenance, and vehicles. There was discussion regarding utilizing debt services, taking on debt to complete projects such as civic plaza improvements, the Hemmens, and additional street projects. Mr. Stegall noted it was a favorable environment for the city to consider utilizing debt services in this way. Adjournment Councilmember Dunne made a motion, seconded by Councilmember Martinez, to adjourn and go into the Executive Session for the purpose of discussing the following matters. Upon a roll call vote: Yeas: Councilmembers Dunne, Gavin, Martinez, Powell, Prigge, Rauschenberger, Shaw, Steffen, and Mayor Kaptain. Nays: None. Selection of a Person to Fill a Public Office, Including a Vacancy in a Public Office, When the Public Body is Given Power to Appoint Under Law or Ordinance, or the Discipline, Performance or Removal of the Occupant of a Public Office, When the Public Body is Given Power to Remove the Occupant Under Law or Ordinance – Exempt Under Section 120/2©(3) of the Open Meetings Act. The meeting adjourned at 6:59 p.m. s/ Kimberly Dewis December 3, 2014 Kimberly Dewis, City Clerk Date Approved