City Council Minutes 1998 10-22-98 MINUTES OF THE REGULAR MEETING OF THE CITY COUNCIL OF THE UNITED CITY
OF YORKVILLE, KENDALL COUNTY, ILLINOIS HELD AT THE KENDALL COUNTY
BOARD ROOM, 111 W. FOX ST., YORKVILLE ON THURSDAY. OCTOBER 22. 1998.
Mayor Bob Johnson called the meeting to order at 7:04 p.m. and led the Council in the
Pledge of Allegiance.
ROLL CALL
Clerk Simmons called the roll.
Ward I Spang Present
Sticka Present
Ward II Burd Present
Kot Present
Ward III Anderson Present
Prochaska Present
Ward IV Sowinski Present
Spears Present
QUORUM
A quorum was established.
INTRODUCTION OF GUESTS
Mayor Johnson welcomed those present and asked them to introduce themselves and to
enter their name on the attendance sheet provided.
AMENDMENTS TO THE AGENDA
None.
MEETING DATES
Public Works Committee 6:30 P.M. Kendall County Building
Monday November 16, 1998 Conference Room - Suite 3
Economic Development Committee 7:00 P.M. Kendall County Building
Tuesday November 17, 1998 Conference Room - Suite 3
Public Safety Committee 6:30 P.M. Kendall County Building
Monday October 26, 1998 Conference Room - Suite 3
Administration Committee 6:30 P.M. Kendall County Building
Tuesday November 10, 1998 Conference Room - Suite 3
CITIZENS COMMENTS
None.
PUBLIC HEARING
None.
PLANNING COMMISSION/ZONING BOARD OF APPEALS/SIGN REVIEW BOARD
Alderman Prochaska stated the Plan Commission met Wednesday, October 14, 1998. He
said Allendale Farms was presented and it was unanimous for rezoning. He said the
preliminary plan for special use zoning was presented by Gary Schlapp and it was
approved with a split decision and will be brought to the next Committee of the Whole
meeting.
Minutes of the Regular Meeting of the City Council October 22. 1998 - Page 2
MINUTES FOR APPROVAL
A motion was made by Alderman Spang to approve the minutes of the Regular Meeting
of October 8, 1998 as presented; seconded by Alderman Anderson.
Approved by viva voce vote.
BILLS FOR APPROVAL
A motion was made by Alderman Sticka to approve the payments of the bill list dated
October 22, 1998 in the amount of$306,419.07 (vendor), $69,837.19 (payroll), for a total
of$376,256.19; seconded by Alderman Sowinski.
Alderman Spang made a comment regarding payment of$10,876.31 to the Lannert Group
and $10,666.31 to Pavia-Marting. He said; "these figures represent an aggregate
uncollected debt to the City of Yorkville of$21,542.62. This debt is uncollected because
the charges are disputed. Developers that have done business with the City and refused
to pay. Business owners that have claimed over charging or unnecessary charges. Or
residents that have negotiated away their responsibility for the debt. Yet here we pay
these bills to avoid being sent to collection ourselves. I pay taxes in this community also.
I don't want those tax dollars spend to pay someone else's bill." He asked that city move
forward with some type of ability to collect these funds.
Approved by roll call vote.
Spears aye Burd aye
Sowinski aye Anderson aye
Prochaska aye Sticka aye
Spang aye Kot aye
Ayes: 8 Nays: 0
ATTORNEY'S REPORT
No report.
MAYOR'S REPORT
No report.
CITY CLERK'S REPORT
No report.
CITY TREASURER'S REPORT
No report.
CITY ADMINISTRATOR 'S REPORT
City Administrator Jim Nanninga stated that the sidewalk replacement program has been
started. HP Said tomorrow two sections should be poured on Main and Hydraulic. He said
Aurora Blacktop will be starting Monday on Walter and Olson replacing curb. He said the
detector loops have been cut on Route 47 and Countryside signal, and expect about mid
December to get the equipment and have it functioning.
SCHOOL COMMUNITY REPORT
No report
OLD BUSINESS
NEW BUSINESS
IEPA LOAN FOR INFRASTRUCTURE
City Administrator Jim Nanninga stated on September 10 there was a motion by the
Council to approve a contract with Hamilton Construction in the amount of roughly $1.8
million for sewer repairs in town that was conditional upon the EPA's approval of the loan
Minutes of the Regular Meeting of the City Council October 22. 1998 - Page 3
and the contract. He said we did get a letter back from the EPA stating the we were
approved for an interest rate of 2-5/8%. He said the City got a call from the EPA stating
that we were approved for the loan but there was a glitch. He said a number of years ago
when the legislature approved setting up loans for municipalities through the EPA they
also attached some sales tax revisions and how those were collected. He said according
to the Constitution you can only have legislation for one particular item. He said a
municipality towards the city has filed a lawsuit, mainly because of the sales tax, which is
holding up everybody's payments. He said the question is do we proceed or do we wait.
He said the problem with waiting is we only have 45 days for Hamilton Construction to
work with the contract or back out of it. He said that Hamilton Construction has given us
a 20 day extension, which puts it about to November 4'h. He said that a number of
communities are proceeding, even with this glitch and are expecting it to be corrected. He
said that this is expected to be corrected through the legislature. He said that if the courts
do not separate the issues between sales tax and the !EPA loan on Tuesday, the
legislature in veto session either this fall or next spring will modify the legislature so that
they are separate. He said he checked with the Yorkville National Bank and the Bank of
Yorkville, if we did proceed they would go together and cover any cost we would have.
He said the problem would be that they are closer to 5% rather than 2-5/8%. He said that
they are recommending proceeding. He said the Yorkville-Bristol Sanitary District is
depending on our work because they are going to go for a big expansion of their plant and
if we don't go forward it will probably delay their expansion about a year.
City Attorney Dan Kramer stated that he is recommending that we go ahead with the
contract. He said if we don't have the project started the EPA could possibly put the whole
project on the shelf, whereas if we had the project started the EPA would be duty bound
to fund the ones already under construction.
There was discussion and comments amongst the City Council.
A motion was made by Alderman Prochaska to authorize the Mayor and City Clerk to
proceed with the execution of the Hamilton Construction Contract, and waive the
contingency of the State approved low interest loan, so long as the City receives an interim
loan commitment from either or both the Bank of Yorkville or the Yorkville National Bank
at a rate not to exceed 5.25%, if funds are needed to be disbursed before distribution by
the Illinois Environmental Agency low interest Loan Program; seconded by Alderman
Sowinski.
Approved by roll call vote.
Burd aye Sowinski aye
Anderson aye Prochaska aye
Sticka aye Spang aye
Kot aye Spears aye
Ayes: 8 Nays: 0
COMMITTEE REPORTS
PUBLIC WORKS COMMITTEE REPORT
No report.
ECONOMIC DEVELOPMENT COMMITTEE REPORT
No report.
PUBLIC SAFETY COMMITTEE REPORT
No report.
Minutes of the Regular Meeting of the City Council October 22. 1998 - Page 4
ADMINISTRATION COMMITTEE
AUDIT ACCEPTANCE
A motion was made by Alderman Sticka to accept the annual United of City of Yorkville
audit for the year ended April 30, 1998 as prepared by Pandolfi, Topolski, Weiss & Co.
LTD.; seconded by Alderman Prochaska.
Alderman Prochaska stated that he has an uncomfortable feeling with the clause that
reads,"because of the inadequacies in the City's accounting records, we were unable to
" He said through the investigation that was performed with the City Treasurer
and the auditing people, they found a glitch with either the software or the hardware which
is beyond the control of the personnel. He said the part the bothers him is that the
Auditing Firm does not make any recognition of this glitch in their report. He also said one
of his other concerns was the transferring of funds from one to another and that the money
was not able to be tracked even though the money coming in matched the money going
out. He said that he would like to see a continued investigation to verify that the funds are
corrected and rectified.
City Treasurer Richard Scheffrahn stated it will be looked into at the next Administration
Meeting to see if re-entering the data into the new software would eliminate the
discrepancies.
Alderman Spang made the following statement (see the attached). He said that he has
taken the audit to two independent Certified Public Accounts for review. He said neither
of them have been able to make heads or tails of it either. He said the accounting
practices that are represented by this audit are irregular and need to be clarified. He
asked that the Council move in that direction rather than acceptance.
Alderman Prochaska stated that it has been explained on numerous occasions that
auditing for municipalities is not the same as auditing for companies and there are steps
that are taken differently.
Mayor Johnson stated we need to do something to try and improve our method of
accounting and the way we do business and how we view our operations. He said it's not
the fault of the Auditor, its the information we provide to them that allows them. He said
that he feels that we are under obligation to accept the audit, but by no means should we
ignore it. He said that we should deal on how to improve the operations and fiscal
operations of the city.
Alderman Spears asked that if some point in the future we figure out where the glitches
were can we amend this audit.
Attorney Kramer replied no, that this audit is based on what they found at the time. He
said that a supplemental audit report can be done.
Alderman Prochaska stated he was not comfortable with the discrepancies with the
beginning and ending balances and would like something in writing for historical purposes
of where the discrepancies came from and where the beginning balance adjustment came
from.
Alderman Sticka stated that he also shares Alderman Spang's concern that we know how
the tax payers money is spent. He said that he believes that we do know where it is spent.
He said at every City Council meeting the council votes on a voucher bill list. He said the
auditors found no evidence that any money was spent that was not approved by the City
Council.
Alderman Kot stated that he to has some concerns on how this was handled. He said it
bothers him when we start rejecting documents just because we don't like the results. He
said this was an independent audit and asked what will the council do the next time the
Minutes of the Regular Meeting of the City Council October 22. 1998 - Page 5
results come back and we don't like it, reject it again. He stated that he agrees that we
should continue to take a look at it and see exactly where the discrepancies are. He
stated that he feels the council has no choice but to accept the audit.
Alderman Burd asked if this could be tabled.
City Treasurer replied that it is due to the state and the county by the beginning of
November. He said that if it is not filed with the county they will no longer disburse
property tax collections until the audit is received. He said whatever the council wants
changed cannot be done quickly. He said that he would ask the Auditing Firm to add a
sentence that they adjusted the beginning balances accordingly. He said that he would
also request that they produce a letter that explicitly states why the numbers were chosen
as they were.
Alderman Spang asked if the auditing firm could respond to the ten issues addressed in
his written statement.
Treasurer Scheffrahn responded that he would ask them.
Alderman Prochaska withdrew his second to the motion. Alderman Sticka withdrew his
motion. The motion was then restated.
A motion was made by Alderman Sticka to accept the annual United City of Yorkville Audit
for the year ended April 30, 1998 as prepared by Pandolfi, Topolski, Weiss & Co. LTD.;
seconded by Alderman Sowinski.
Approved by roll call vote.
Sowinski aye Anderson aye
Prochaska nay Sticka aye
Spang nay Kot aye
Spears aye Burd aye
Ayes: 6 Nays: 2
A motion was made by Alderman Prochaska that the City require the accounting firm of
Pandolfi, Topolski, Weiss & Co. LTD. to provide a supplemental audit report detailing all
adjustments to funds, balances for original City entries making explanation of said
adjustments; seconded by Alderman Spears.
Approved by roll call vote.
Anderson aye Prochaska aye
Sticka aye Spang abstain
Kot aye Spears aye
Burd aye Sowinski aye
Ayes: 7 Nays: 0 Abstain: 1
CABLE TV - INTERGOVERNMENTAL AGREEMENT
A motion was made by Alderman Sticka to authorize the Mayor and City Clerk to execute
the Intergovernmental Agreement for the Southwest Fox Valley Cable and
Telecommunications Consortium with the Village of North Aurora, the City of Plano, the
Village of Oswego and the City of Sandwich for the purpose of negotiation of cable and
telecommunications rates and renewals and/or modifications of cable franchises, and any
other telecommunications agreements; seconded by Alderman Sowinski.
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Minutes of the Regular Meeting of the City Council October 22. 1998 - Page 6
Approved by roll call vote.
Prochaska aye Sticka aye
Spang aye Kot aye
Spears aye Burd aye
Sowinski aye Anderson aye
Ayes: 8 Nay: 0
ADDITIONAL BUSINESS
Alderman Spang stated the October neighborhood meeting for Ward I will be Tuesday,
October 27, 1997 at 7:00 P.M. at West Side Gyros. He said the guest speakers will be
Michael Morley of Waste Management who will address refuge removal and recycling and
City Engineer Joe Wyrott who will present details of the upcoming Sanitary-Sewer
improvement project.
ADJOURNMENT
A motion was made by Alderman Prochaska to adjourn the meeting at 8:19 p.m.; seconded
by Alderman Anderson.
Approved by viva voce vote.
By:
C . C 11 ti lrtcyt�
Deborah K. Simmons, City Clerk
City of Yorkville, Illinois
CITY COUNCIL MEETING
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10/22/98
Since this audit was first brought to my attention I have had great difficulty
in understanding it. I believe some of you have joined me in that concern. I am
not a financial expert, accounting expert or an auditor. I am a public servant and
a taxpayer.
When a public body taxes citizens and then spends those dollars for the
public good, that public body has an obligation to provide a clear and concise
accounting of how those funds were spent. At this point, that has not happened.
As I have struggled through this audit I have continually come upon questions I
have been unable to grasp an understanding of. Tonight, we attempt to take
action to accept this audit.
It is my belief that this audit is incomplete and should not be accepted until
the following questions are satisfactorily addressed, in writing, by either the
auditing firm or a financial officer of this board.
1. The beginning balance of the Kendall County E.D.C. Loan for 5/1/98 does not
match the ending balance from 4/30/98. It is off by $5,163. Please explain
the reason.
2. The beginning balance of the YNB. Loan for 5/1/98 does not match the
ending balance from 4/30/98. It is off by $59,094. Please explain the reason.
3. The Backhoe Loan ended last fiscal year with a balance due of$1,469. This
loan does not appear in the audit presented tonight. Difference = $1,469.
Please explain the reason.
4. The beginning balance of current Long Term Debt does not equal the ending
balance from last years Long Term Debt. Difference = $52,462 Please
explain the reason.
5. Beginning fund balances for the following nine funds do not equal the ending
balance for these funds last audit year: General, Library, Motor Fuel Tax,
Park Commission, Debt Service, Municipal Building, Water Operating, and
Land Cash. These imbalances are repeated in Statement 3 for the General
Fund and for the Debt Service Fund. Total net difference = $325,098 Please
explain the reason.
6. Two funds, the Sanitary Improvement and Expansion Fund and the Water
Improvement and Expansion Fund, did not exist in the previous audit year yet
they began this audit cycle with a beginning balance. Where were these
dollars acquired? Unaccounted Fund balance = $ 46,595 Please explain the
reason.
7. The Fixed Asset Schedule shows no appreciation for land or buildings and no
depreciation for vehicles and equipment. Is this an accurate method of
accounting? Why have we not included appreciation and depreciation as a
part of this schedule?
8. The Special Revenue Funds beginning balance is not equal to last years
ending balance. Difference = $14,346 Please explain the reason.
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9. The South Sewer Fund is a newly created fund. No balance is shown on
page 48, the Statement of Revenues, Expenditures, and Changes in Fund
Balance. However, a note # 14 on page 24 of the audit seems to indicate
this fund is in deficit. Is this fund in a deficit status?
10. The Independent Auditor's Report on page 1 states that "Because of
inadequacies in the City's accounting records, we are unable to form an
opinion regarding the amounts recorded as revenues and
expenses/expenditures." The Auditor has also asked for two years for a
"detailed fixed asset ledger." Due to these issues the auditor has chosen not
to render a complete opinion regarding the financial status for the City of
Yorkville. Whose responsibility is it to provide the documentation required to
allow the auditors to provide that opinion?
Without such an opinion, this audit is not complete. Accepting this audit or
acknowledging it as complete would be a disservice to our constituency. They
deserve a full and clear accounting of these funds.
Jeff Spang
Alderman, Ward 1