Board of Trustees Minutes

2121 West Lake Street

President Craig called the Meeting to Order at 7:30 P.M.

PRESENT: Trustees Wesley Eby, Joseph Nicolosi, Robert Packham, Toni Carter, William Manton, and President Rodney Craig

Trustee Lori Kaiser arrived late at 8:12 p.m.

ABSENT: None

He stated this preliminary budget formed the basis with consensus from the elected officials prior to the drafting of the final budget, with submittal by April 17, 2008 the formal budget as required by statute. He noted the general fund was balanced with all expenditures and revenues included. He commented this was a dynamic process and one truism was that things always changed. He stated there were significant changes from when this process began last November. He included a 3% increase in the health care benefit cooperative, and unfortunately, stated he was notified the costs were 8% more, an increase of $136,000 which the budget needed to absorb. He also noted the elimination of the Collector position. He continued that his recommendation as submitted continued to stand. He added that resources were needed to pay the added health care cost.

He stated the booklet contained three (3) sections: the Narrative Memorandum, the Budget Exhibits, and C.I.P. (the Capital Improvement Program).

He continued the Narrative highlighted revenues and expenditure topics and presented policy discussions; the Exhibits provided accounting and fund issues including expenditures and revenues; the C.I.P. provided a listing of the major capital improvement items generally defined as greater than a $10,000 one-time purchase. He stated each one had a page with a more detailed description of that request and finally there was a future glimpse of the capital needs of the Village.

Mr. Hummel stated the overview of the budget included 22 separate funds and was 4% greater than the prior year, and key highlights were proposed with 4 additional full-time employees, including 2 Police patrol officers as well as 2 Code Enforcement officers. He stated there were significant allocations for the following: acquisition of land for the purposes of future municipal building expansion; 50^th anniversary special events; public safety pension plans; seed money for the creation of the Hanover Park Chamber of Commerce; and funding of public safety positions decreasing the "sinking" fund for the fleet services program. He stated consultant fees were reduced in the public information division. He requested an approximate 10-year review of the Comprehensive Plan and an update to the Zoning Ordinance. He recommended a 4.5% property tax increase which was within the Truth in Taxation limitations, and noted the Board already had adopted a 4 year 8% water and 4.5% sewer rate increase. He also noted there were increases in user fees including ambulance and rental residential inspection fees.

He stated some of the capital projects highlighted included a grant for a bike path along the Northern Gas Pipeline (NGPL), reconstruction of a concrete street, specifically Tanglewood Avenue, a significant allocation for IT in the form of hardware and software, the Creek Bank repair program north of Walnut Avenue, and an approval of an expanded water main replacement program for $500,000. He continued to comply with state mandates we budgeted for construction of a dissolved oxygen tank associated with the Wastewater Treatment Plant, replacement of a Fire Pumper engine, and finally, the purchase of a 2½ ton dump truck in the fleet division.

He stated moving into the expenditure operating components Village-wide, all 22 funds aggregated into the following statistics. The full-time salaries account was 6% or $692,000 greater than the prior year, which included the 4 additional employees as well as contract provisions for those not covered by a contract, a 2% across the board increase and a merit adjustment up to 3% and up to 4% for supervisory and management personnel positions.

He stated in the public safety divisions, a greater overtime allocation was budgeted and the health insurance allocation of 3% was incorrect and the new reviewed number was 8% or $136,000. He stated pension costs for public safety employees increased approximately 10% or $280,000, these costs being received by the actuarial. President Craig asked for the total health insurance costs and Mr. Hummel stated it was $2.69 million in the 2009 budget representing an 8.2% increase.

Mr. Hummel continued that gasoline increased significantly and 26% more was budgeted and that it impacted all of the operating funds for an additional $62,000. He stated for the first time the Village was incurring general fund natural gas costs; in the past under Northern Illinois Gas costs were franchise free therms and with advent of the additional buildings next year we budgeted $8,500 to cover the therm usage beyond what we were granted in our franchise allotment. He stated liability costs were up 12% or $84,000. He stated a key reduction allowed us to increase our public safety staffing by reducing the contribution to the fleet sinking fund by $150,000 or 16%. He stated over the years we have kept our vehicles longer than the life cycle projections allowing us a surplus to use those dollars to fund additional safety positions. He stated training increased $22,000 based upon basic training costs as well as other contributions to continuing education programs in several departments. He stated finally the special events budget was approximately $235,000, noting there were revenues incorporated into the budget to defray the costs, about $117,000 net cost.

It was commented that the health insurance premiums for 200+ employees seemed exorbitant and asked if we had sought other alternatives. Mr. Hummel stated it was being looked at right now but it was a very complex topic with many components. Basically, he commented, losses directly determined costs and overall, the health care costs over the last 10 years averaged a 12% increase. He stated while it seemed high, the insurance pool fluctuated but he felt it gave reliable coverage. Another comment made was there were only two police officers in the budget and it was requested that there be more and it needed another look. Mr. Hummel stated it was his recommendation to increase staff incrementally based upon available revenues and he stated concern over the reliability of some of the revenues. He concluded he heard the Board, but the revenues were not there to support more than two at this time as he provided a balanced budget.

It was questioned how much employees contributed to the costs of insurance and Ms. Richard answered it was in the range of 3½% to 10% of the premium costs. It was questioned if perhaps the employees should pay more and Mr. Hummel answered an element of that was in the labor contract and noted there were various plans and some were less costly than others. It was questioned how many were in unions and answered approximately 2/3 of the employees were covered by the Teamsters, MAP, or IAFF contracts. It was then questioned how many union contracts we negotiated with and answered technically with four, an additional union did not provide health care, the POC (paid on call). He noted in FY’09 we had two contracts up, the IAFF and the MAP contract, stating we were coming off a 4-year IAFF contract, and a 3-year MAP program. It was then noted that 1/3 of employees were administrative and general employees and that they were not paying their fair share of costs as in the private sector. Mr. Hummel stated if we tried to balance the budget with the 1/3 of other employees that it may very well create another union.

It was questioned why it cost $105,000 each for the police officers when recruiting these officers from universities. Mr. Hummel stated the itemized costs incorporated the pension costs for public safety employees and this was an enormous cost with legislators only increasing them. He noted that health care was fast approaching the cost of the salary and stated that historically governmental employees focused on benefits rather than compensation. Discussion continued on benefits. It was noted that we do need to have comparables with union and non-union positions and that which is in the private sector for unions did not even come close to the municipal sector.

President Craig added that he did not feel two officers were enough as he was looking for a total of 9 officers over three years, with four this year, three next year, and two the following year.

Mr. Hummel explained the chart on page 5 and noted it was very important. He noted the FY09 request column and explained at the 2^nd to the bottom line there was a $21,190 amount and that was the number of all the total operating revenues of $22 million, noting the budget was balanced by $21,000. He stated at the same time the recommended budget proposed to draw down on our "savings account" by $1.9 million. He stated there was history there and he wanted to emphasize that the operating revenues were up 5%, operating expenditures were up 5% and as proposed there was a $21,000 positive balance in the corporate fund.

Trustee Kaiser arrived at 8:12 p.m.

He stated in terms of general fund revenues, property tax next year projected a $348,000 addition based upon 4%. He stated the sales tax had gone up and in contrast the real estate transfer tax went down due to the substantial downturn in the real estate market that revenue source was down $129,000 or 64% than the prior year. He noted the state income tax was probably the driver of the budget and was projected at a 6% increase which was an additional $180,000 and in the summary, the proposed multi-family license increase from $50 to $85 per dwelling unit (apartment), generated an additional $31,000. He noted initiating the new rental residential program for single family attached/detatched and duplex units was a $180 fee which would pay for the 4^th additional employee in Code Enforcement, making it a revenue neutral program. He noted the ambulance fees were to be increased along with federal guidelines generating an additional $80,000. And in contrast, he noted impoundment fees were down $90,000 from the prior year and the interest on investments with recent federal action reducing rates showed a $35,000 drop in that revenue. He also pointed out the SAFER grant allowed us to fund firefighters in prior years would drop off by $30,000 next year, and the Family Festival was a one-time expenditure for a net cost of $135,000. He continued the Fire District used to generate property tax monies from Countryside and this was reduced by $85,000. In summary, he stated the general corporate revenues were up 3%.

President Craig noted Streamwood enacted an impoundment ordinance and he questioned if that had an impact on our impoundments and Chief Moser stated no it did not. Further discussion noted that Streamwood’s impoundment was not enacted yet, nor did it include all that was in our ordinance.

The Code Enforcement officer position regarding the single family rental program was questioned and further clarification was given. Vehicle Impoundments were further discussed with clarifications on an unfavorable court ruling reducing the number of impounds by 20%, and noting the number of officers available reduced that number. The possibility of using contractual services was brought up and the Police Department was going to evaluate the costs.

Mr. Hummel stated the Police Department’s overall budget increased 6% and the biggest topic was staffing. He stated the Police Department had identified their need of hiring between 9 and 19 officers to be adequately staffed. He pointed out the history and the future hiring of officers and stated over a 10-year period for public safety personnel, the cost had doubled. He further pointed out if the Board wanted to hire more than what he recommended, page 38 listed additional revenue sources to do so. He noted next year property would be re-assessed in the Village and that would increase monies.

Mr. Hummel continued that we budgeted for 52 officers and yet there were not 52 on the street. He stated this was an inherent problem, with many officers off for various reasons, be it health issues, training, retirement, resignation, etc. He reiterated his recommendation was 2 and he would be happy to add more through a Board directive along with a revenue source to increase it. Mr. Hummel reviewed the capital projects for the Police Department.

Mr. Hummel stated the Fire Department budget increased 6% and pension costs increased $96,000 or 26% more than the previous year. He noted there were two initiatives: the ambulance service accreditation program at a cost of $11,000; and improvement of the commercial fire code inspection program. He noted that the Battalion Chief testing allocation should have been $7,070 and not $16,000 as noted on page 10. He stated included were testing costs for Paid on Call (POC) firefighters. He stated there were other fire costs which included mandated elevator maintenance and a new microwave link between the Village Hall and Fire Station 2.

He continued describing the capital projects for the Fire Department. He mentioned that Engine 361 was not 40 years old as indicated on page 10 but 30 years old. He noted while the engine would probably not be delivered in FY’10, he did not want to sign a contract without the dollars budgeted. He stated that six new carbon monoxide blood monitors were on listed at a cost of $3,750 each for a total of $22,500.

Mr. Hummel continued that the Public Works portion of the budget included Administration, Streets, Forestry, Public Buildings and Fleet Services as well as Engineering and their costs were increased 3% from last year. He summarized that $3,000 was allocated for NIPSTA (Northern Illinois Public Safety Training Academy) membership and that the facility was located at the former Glenview Naval facility.

Mr. Hummel noted the sidewalk reimbursement program was very successful and they had increased reimbursement from $3 to $4 per square foot. He continued that Forestry budgeted $8,500 for contractual landscape at

Ontarioville Park, Memorial Park and Greenbrook Boulevard and $5,100 was budgeted for a part-time seasonal employee during the spring and summer.

He noted a major asset was our parkway trees and the new Emerald Ash Borer (EAB) problem has been identified and they proposed $15,000 for a removal and replacement program. He stated another $18,000 was budgeted for tree removal due to wind storms and age. Various other programs outlined in the budget booklet were discussed.

He stated in the Public Buildings, the shooting range had $8,000 budgeted for lead clean-up and $7,000 budgeted for installation of safety equipment in elevators. In the Fleet Services, monies were budgeted for auto parts, as well as drive cam support and managerial services.

He highlighted some of the various capital projects: the Creek Bank Repairs, the salt brine making equipment, Lake Street concrete median improvements, parkway trees, Village banners, and the replacement of a dump truck.

He noted Engineering had a list of budgeted capital projects such as the Lake Street Streetscape at $160,000, five new streetlights were allocated, the NGPL bike path in which $530,000 was allocated and federal grant monies were expected, the Tanglewood Avenue street reconstruction at $250,000, the completion of the Army Trail Road Arterial Fence, the Irving Park Road Streetscape Phase 3, and the Storm Sewer headwall construction.

Sherry L. Craig