City of Oak Forest Committee of the Whole met Nov. 23.
Here are the minutes provided by the committee:
Mayor Kuspa called the City Council meeting to order at 6:35 p.m. with the Pledge of Allegiance and the Roll Call as follows:
Present: Alderman Gray
Alderman Selman
Alderman Emmett
Alderman Hortsman
Alderman Danihel
Also Present: City Clerk Jack Janozik
Treasurer Ericka Vetter
City Administrator Timothy Kristin
Finance Director Colleen Julian
Acting Fire Chief Kasper
Building Commissioner Michael Forbes
Public Works Dir. Darlene Milanowicz
Absent: Alderman Simon
Alderman Wolf
4. DISCUSSION OF FISCAL YEAR 2023 BUDGET PRESENTED BY FINANCE DIRECTOR JULIAN
Finance Director Julian began by speaking about the annual Tax Levy and projection of the Fiscal ’23 Budget, which begins May 1, 2022 and ends April 30, 2023; these are the property taxes that will fund that year.
Director Julian is predicting a slight decline in revenue; we have had an extremely robust Fiscal ’22 and she thinks it would be wise to project a downward trend. She took the current year revenues and used a 5% reduction for her model trying to be conservative.
Salaries are flat. There is a decline in salaries due to retirements and new hires at lower salaries. Insurance has a very modest increase of $95,000. Proposed capital projects for Fiscal ’23 are about $400,000 more than normal; she has sent out a detailed list of all the capital projects with her recommendation to fund these projects, as they are necessities, not wish list items. A lot of it is machinery that hasn’t been replaced in many years and some requests from the departments, which will be discussed.
Pension increase is 6%, which is on trend with expectations. Total increase in expenses were $800,000 and, over $200,000 in decreased revenue is where she comes up with a $1.1 million, or 9.7%, Levy increase.
Director Julian went into further detail on each topic, including discussions had with department heads, and capital requests.
Alderman Selman mentioned the equipment to be purchased possibly being affected by the global chip shortage, and asked if it was worthwhile to wait until the equipment can be purchased, constructed, and delivered. Director Julian explained this plan would not go into effect until six months from now and they would have another twelve months, so six to eighteen months from now, that these purchases are scheduled. Alderman Selman then asked if we are still waiting for an ambulance, and was told we are.
Director Julian stated this time last year, we needed over $1 million, and it was decided to go into reserves as a one-year solution because they were looking to help the residents and businesses. There was a 0% Levy increase, which she stated could only be done once. With revenues going up there is no need to go into the reserves. Fiscal ’21 came in with a $990,000 surplus, which they thought would be needed in 2022.
2022 will not need it either, so there is really strong revenue in reserves at a total of $6.6 million. We’ve been getting grants, and some of the businesses in town have had strong revenues that have helped our sales tax. She explained the reason she is giving the revenues a bit of a trim is because she doesn’t think we can keep riding this wave. The revenues in Fiscal ’22 are going to be $775,000 more, in October it was $1 million. She then explained a chart of the revenues for the past few years.
Director Julian moved on to the topic of pension funds. After discussions with the actuaries, she is continuing to use the more aggressive funding methodology. By doing that, we are paying more, and she compared it to paying a mortgage in 15 years or 30 years. At this point in time, she thinks we should stick with our current methodology. The pensions took a nice ride on the wave; Police had a 29.6% return on their assets and are 66% funded, with Fire returning 25% and are now 84% funded.
Alderman Emmett asked if the same market of positivity will be seen if they pool Police and Fire together. Director Julian said there will be a consolidation but there will still be individual reporting on individual assets; it’s consolidated but not comingled.
Notes from the actuary include the adoption of a generational mortality, which means people are going to live longer. At the actuary’s advice, she is recognizing that people are going to live longer, so they’ve built that into the contributions. The pensions have almost doubled since 2012, and the City is committed to staying on that path. By 2030, you will see the unfunded go away and you’ll see significant savings.
Director Julian went back to the 9.7 Levy. She thinks we can safely use $800,000 of reserves, which would bring it to a 2.4 Levy; we’re still levying for the pension fund. Use the General Fund to offset those robust revenues and to fund the capital purchases, would be her suggestion. The department heads were told if the $800,000 is there, the capital purchases will be green-lit. Another option would be to postpone capital, which would be kicking the can down the road.
Director Julian is happy to report the fiscal year will end with no deficit. Capital projects can be done, the reserve policy is met, taxes are not being raised, and the pensions are still being funded. The reserves are the strongest they’ve ever been.
Mayor Kuspa thanked Director Julian for an excellent, detailed report.
Director Julian stated at one time the city had almost $3.5 million in TIF loans, we owe $900,000 now, and the city sold some properties, which are part of that loan.
5. SELECTION OF PROJECTS FUNDED BY THE AMERICAN RESCUE PLAN ACT (ARPA) PRESENTED BY FINANCE DIRECTOR JULIAN
It is Director Julian’s opinion that one of the easiest ways to spend the American Rescue Plan Act (ARPA) fund is the water and sewer infrastructure. Other items of eligibility don’t apply to the City, and she explained these to the Council. The reason she brought up the idea of applying it to water and sewer infrastructure is there needs to be an ongoing water main and sewer rehab program. This money would give a head start; with the engineers wanting $1.2 million annually, this would get us started. She told the Council they need guidance on what projects to spend the money on; she wants to get the design work done and get out to bid to avoid the worst bids or not have the raw materials needed.
Alderman Emmett feels this should be used for the infrastructure; chipping away at $15 million, because of unknown issues, it should be dedicated for that fund.
City Administrator Kristin asked Council if there is any objection to doing any of the high priority (water) projects so they can move forward. Alderman Emmett stated the construction at the Park District is delayed due to lack of supplies, so he feels they should get ahead of it now.
6. CITIZENS PARTICIPATION
June Duffin, of 15051 Ridgeland, had dropped off a statement and petition at the Mayor’s Office earlier. She read the letter to the Council, giving thanks to Building Commissioner Mike Forbes and Ordinance Enforcement Officer Lorna Stubbs, and people from Public Works. She complimented the work done at Ridgeland and Victoria, and suggested more trees along the curb and on Central. Her main concern is the gun range on 159th Street. She believes there is no sound barrier; she gets noise complaints from her tenants as they can’t open their windows or sit on their porches. She says it is a constant noise. She has gone in to the gun range to complain and has been treated negatively by their staff. She is asking for a study to be done. Mayor Kuspa informed her staff is aware of this and have already started the investigation with sound meters.
Jacqueline Spreadberry, of 5243 Temple, was there on behalf of family members. She called and was told the meeting started at 7:30, and it seems like there was confusion. Mayor Kuspa explained to Ms. Spreadberry the Committee of the Whole meeting started at 6:30, the regular meeting should be starting at 7:30, but she has the floor so he can’t start the regular meeting. Ms. Spreadburry said she would wait.
Mayor Kuspa explained that the standard Citizens Participation rule is 3 minutes. It is also asked during Citizens participation not to be redundant; if the person before you made the point, then the point has been made.
7. OLD BUSINESS
None
8. NEW BUSINESS
None
9. EXECUTIVE SESSION
Not needed
10. ADJOURMENT
Alderman Emmett made the motion to adjourn.
Alderman Danihel seconded.
Roll Call vote was taken as follows:
AYES
NAYS
ABSTAIN
ABSENT Alderman Emmett
Alderman Hortsman
Alderman Danihel
Alderman Gray
Alderman Simon
Alderman Wolf
Alderman Selman
The motion to adjourn carried 5/5. The Council of the Whole meeting ended at 7:34 p.m.
http://www.oak-forest.org/AgendaCenter/ViewFile/Minutes/_11232021-1464
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