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City Council Minutes 2011 02-08-11 MINUTES OF THE REGULAR MEETING OF THE CITY COUNCIL OF THE UNITED CITY OF YORKVILLE, KENDALL COUNTY, ILLINOIS, HELD IN THE CITY COUNCIL CHAMBERS, 800 GAME FARM ROAD ON TUESDAY, FEBRUARY 8, 2011 Mayor Burd called the meeting to order at 7:00 p.m. and led the Council in the Pledge of Allegiance. ROLL CALL Clerk Milschewski called the roll. Ward I Gilson Present Werderich Present Ward I I Golinski Present Plocher Present (until approximately 9:00) Ward III Munn Absent Sutcliff Present Ward IV Teeling Present Spears Present Also present: City Clerk Milschewski, City Treasurer Powell, City Attorney Orr, City Administrator/Interim Director of Park and Recreation Olson, Police Chief Hart, Deputy Chief of Police Hilt and Delany, Finance Director Fredrickson, City Engineer Wywrot, Community Development Director Barksdale -Noble and City Park Planner Schraw. QUORUM A quorum was established. INTRODUCTION OF GUESTS Mayor Bard asked the staff and guests to introduce themselves. She welcomed the guests and asked them to enter their names on the attendance sheet provided. AMENDMENTS TO THE AGENDA Mayor Burd requested that the Executive Session be moved up on the agenda to after the audit presentation. Amendment approved unanim ously by a viva voce vote. Alderman Werderich noted an error on the consent agenda. Item #5 - Request to Sell 2007 Ford Crown Victoria (M21) at Auction (PS 2011 -04) should be for a 2000 Ford Crown Victoria. Alderman Gilson asked that Item 1 - Ordinance Approving an Intergovernmental Agreement for Eldamain Road Reconstruction (EDC 2010 -43) on the consent agenda be removed and placed on the regular agenda under the Economic Development Committee Report for further discussion. Mayor Burd asked that Item #1 - Park Naming Request - Marge Cline (CC 2010 -104) be tabled. Amendments approved unanimously by a viva voce vote. COMMITTEE MEETING DATES Public Works Committee Meeting: 6:30 p.m., February 15, 2011 City Hall Conference Room Economic Development Committee: 6:30 p.m., March 1, 2011 City Hall Conference Room Administration Committee Meeting: 6:00 p.m., February 17, 2011 City Hall Conference Room Public Safety Committee Meeting: 6:30 p.m., February 24, 2011 City Hall Conference Room PRESENTATIONS Audit Presentation Mike Senko and Ryan Doerffler with Wolf and Company gave an audit presentation. Mr. Senko explained that this is the third year the Wolf & Company has done the city's audit. He complimented I The Minutes of the Regular Meeting of the City Council — February 8, 2011— Page 2 City Finance Director Fredrickson for doing an outstanding job with the audit and stated that this was the smoothest audit they have experienced with the city. Because of this, the fee will be half of what has been in prior years. He explained that the audit is conducted on a test basis and not 100 %. Procedures have been applied and they have come up with a clean opinion. He stated that nothing came to their attention that will materially affect the city. Alderman Gilson questioned the delay in the efficiency report which the City Council still hadn't received. Mr. Senko explained that the audit was done in the quickest fashion to date. Subsequent to the audit, discussions take place and the management letter is drafted. Before the letter is finalized, the audit is presented. The letter can then be adjusted if comments and/or concerns after the presentation warrant it. This is standard procedure. Mayor Burd noted that staff immediately forwarded the audit on to the City Council when they received it. She asked if the City Council would like the audit held until the management letter was completed. Aldermen Gohnski, Werderich, Plocher, Sutcliff and Teeling stated that they would like to see the audit numbers as soon as possible. Aldermen Gilson and Spears stated they would like to see the two together. Alderman Gilson noted that last year the Council received the deficiency letter the day of their meeting. He stated he would like to see it in advance of the meeting to have time to review it. Mayor Burd stated that staff hands the letter off to the Council as soon as they can. She proposed that the information could be held two weeks after it is received until the next City Council meeting. Mr. Senko added that if something material was evident they would not present the audit in its final form. Alderman Gilson had questions on the following: • Page 30 — Government -wide Financial Statements - Interfund activity has been removed. What is interfund activity? The auditors explained that it is reimbursements such as insurance and similar items that are moved from one fund to another • Page 31 — Fund Financial Statements - B. Basis of Presentation - Pension trust fund and agency funds — why are they not included in the financial statements. The auditors explained that agency funds are those that receive cash that ultimately go to another party. These funds cannot be used at the city's discretion. These funds have no affect on the budget. Director Fredrickson gave the example of developer deposits and the Yorkville Bristol Sanitary District funds that are held in escrow. Mr. Senko explained that this is normal and is directed by governing bodies to make things consistent across the board. • Page 31 — Measurement Focus and Basis of Accounting — Item C - due to the states fiscal difficulties the state's availability period for income taxes was extended — is this normal? It is normal for this period of time with Illinois municipalities. The auditors explained that this in order to make the reports from the state consistent across the board. Director Fredrickson added that this gives budgetary control and is reflected as receivables in the fiscal year. • Page 32 - Measurement Focus and Basis of Accounting — Item C - explain the differences that occur from the manner in which activities within the financial statements are prepared. Mr. Senko explained that GASB34 requires assets and debts associated with it to be reflected. • Page 32 — Budgets and Budg_ctary Accounting - Item D — # 1 Alderman Gilson commented that some members of the City Council voted against the current budget. • Page 33 — Budgets and Budgetary Accounting - Item D — #4 - thought the budget officer's ability to transfer budgeted amounts between departments within any fund was improper or unacceptable. Mr. Senko explained that transfers like this happen in most municipalities. Director Fredrickson added that the City Council has the right to move money between funds with a budget amendment. Administrator Olson, as the city's Budget Officer, can also do this as long as it is privy to the General Fund. It is not illegal from a budget standpoint. • Page 33 — Capital Assets — Item E . - why isn't land and construction in progress depreciated? The auditors explained that is not a generally accepted accounting principle to depreciate land. Depreciation begins when an asset is placed into service but this does not apply to land. Treasurer Powell asked if this was consistent with other municipalities and was told it was. • Page 34 — Summary of Significant Accounting Policies — Item H — Management uses estimates in preparing financial estimates. For example? Director Fredrickson explained that sales tax estimates, for example, are used as part of the accrual process. The auditors added that esti mate of state income tax payments is also an example. They can be estimates from this year or the prior year. • Page 34 — SgmggM of Significant Accounting_ Policies — Item K — Interfund Receivables and Payables — Is this standard procedure? The auditors stated it was and directed the City Council to page 11 for the internal balance number. • Page 35 - Summary of Significant Accounting Policies — Item N — Fund Equity/Net Assets — To what does this apply? Director Fredrickson explained that it applied to funds for capital improvement, debt service, prepaid assets, etc. �I The Minutes of the Rezular Meetinz of the City Council — February 8, 2011— nape 3 • Page 36 - Sggg!M of Significant Accounting Policies — Item O — Bad Debt Policy - When the policy is not followed, did auditors take the writing off of bad debt as a deficiency? The auditors stated that following the policy is a positive; collectables are analyzed to determine what things are just not collectable. Director Fredrickson explained that the policy was followed; staff tries to collect owed funds for one year however if something proves uncollectable, it is written off. If it is collected, it is reflected as income. Director Fredrickson added that now there is a procedure in place so developers have to put money up front • Page 38 — Deposits and Investments — Item C — Police Pension Investments — Asked if Yorkville was making safety the foremost objective when investing for the pension. The auditors stated it was. • Page 47 — Long Term Debt — Adjustable Rate Note — could this be explained in more detail? Director Fredrickson explained that this note was for the Public Works facility. Administrator Olson added that this is a self - financing mechanism. The owner of the property financed the sale of the property with an adjustable rate loan. Alderman Gilson asked if the city was still making payments and Administrator Olson clarified they were. • Page 48 — General Obligation and Alternate Revenue Source Bonds — Series of 2004B (Alternate Revenue Source) — Were these bonds for the waterworks and sewerage system abated? Director Fredrickson stated that these were not abated and will be paid for with property tax. Mayor Burd asked Alderman Gilson, for the sake of saving time, to stick to audit questions and direct other questions to staff. Alderman Gilson asked if the notes in the report were from the auditors or staff. Mr. Senko clarified that the report is developed by the city staff and then the auditors make sure it is compliance. • Page 57 — Commitments and Contingencies — Purpose of significant transfers — What is the auditor's opinion of enterprise funds in terms of them being self - sustaining. Mr. Senko explained that enterprise funds should be self - sustaining. Another thing to look at is if it is permanent in nature. If something is not self - sustaining one year it does not mean it is not self - sustaining overall. Water and sewer funds are self - sustaining funds. • Page 59 — Defined Pension Benefit Plan — Item A — Annual Pension Cost = What is the explanation for the statement that the city's unfunded actuarial accrued liability is being amortized as a level percentage of projected payroll on a closed basis? Mr. Senko stated he couldn't explain this because it is an actuarial calculation from D RF. How are pension payments funded? Mayor Burd noted that a presentation was given to the City Council about the pension fund. She stated that the fund is new and there are not many retirements coming up. Also the pension board is happy with the amount of funding. Mr. Senko added that comparably speaking the city is in better shape than other communities. Treasurer Powell noted that the law just changed to have the pension fund 90% funded by the year 2040 rather than 100% funded by 2033. Alderman Gilson had the following questions about Administrator Olson's February 4, 2011 memo: • Is it still the opinion not to prepare a revised budget mid -year? Director Fredrickson explained that in the past the City Council amended the budget however most municipalities do not do this. Once the budget is passed, it should not be amended. • The memo addresses the negative fund balance and states that staff received the preliminary fund balance number in late November as the audit figures were being finalized. He question why this was and noted that when he came into office, he spoke with former Finance Director Mika who knew the city was going to have a problem paying the debt service. Administrator Olson felt that Alderman Gilson might be confusing things; staff knew that the General Fund balance would be at zero however it came in lower. As to the debt service issues, staff has known about them for years. Some of them were addressed through refinancing however it has become evident that the city cannot make the payment on the water and sewer debt. The November figure referred to in the memo is the general fund. • Which line items could still be tightened up? Mayor Burd noted that Administrator Olson would be giving a PowerPoint presentation on the audit which will address this. Alderman Golinski stated that his greatest concern besides the deficit in the general fund is the cash borrowing indicated on page 58 of the audit report. The general fund has borrowed over $1 million for the sewer fund. He noted that the city cannot abate the sewer bonds and he asked where the money was going. Director Fredrickson stated that negative cash balances cannot be shown on a financial report so funds are being borrowed from the sewer fund to shore up the general fund. The funds are still available for the sewer fund. Alderman Golinski asked if there was a plan to pay back the sewer fund. Director Fredrickson stated that this can be done with a fund adjustment. Alderman Golinski stated that finds were also transferred for the Rec Center. Director Fredrickson stated that this needs to be addressed in i The Minutes of the Regular Meeting of the City Council — February 8, 2011— page 4 the budget process and a plan to build up the general fund needs to be developed. Alderman Golinski asked how many years it will take to build this back up. Director Fredrickson stated he was not sure; this was a budget discussion. Alderman Golinski stated that one of the excuses for the deficit noted in Administrator Olson was that a transfer from the police capital fund was disallowed. He asked why this was disallowed. Director Fredrickson explained it was not an interfund transfer or revenue but rather an interf ind loan which is a liability which creates a shortfall. There were no fiuther questions or comments. Mayor Burd noted that the auditors were willing to come back to the next City Council meeting if there are questions about the management letter. Administrator Olson and Director Fredrickson gave a PowerPoint presentation (see attached). Alderman Gilson asked where the bad debt figure of $1.7 million came from. Director Fredrickson explained that the $1.7 million figure represents the change in fund balance from last year to this year and is cumulative. Also included is bad debt from fiscal year 07/08. Administrator Olson addressed Alderman Gilson's earlier question on where the budget could be tightened up. He went over the spreadsheet addressing this and noted some areas such as utility tax from Nicor which was over estimated. Mayor Burd asked how the staff could predict drastic changes due to the economy. Administrator Olson stated very carefully and sometimes incorrectly. He stated that staff looks at year to year multi- totals, recent trends, disbursements, etc. Alderman Spears suggested that as the City Council members are surveyed for the budget meeting, staff makes sure they know the meeting may take all day so that people do not leave early. Alderman Golinski commented that it would probably be labor intensive to come up with a list of all the bad debt however he wondered if staff could come up with a "top ten" list. Administrator Olson indicated that this could be done however it could take up to 60 days to develop. Alderman Gohnski stated he did not want reasons just the amounts. Alderman Golinski asked about the $76,000.00 accelerated from last year. Director Fredrickson explained that he has a list of outstanding invoices that varied from the general ledger however he did not know what comprised the amount. He stated that there is currently about $35,000.00, excluding the landfill, in accounts receivable that may or may not need to be written off. Administrator Olson noted that the amount re mainin g due to the landfill in about $224,000.00 related to the original application and the appeal. Mayor Burd stated that the whole issue with the fund balance has been a painful four year journey. She stated that after she took office she found out that a portion of the fund balance was bad debt. Litigation costs ate into the "rainy day" fund. Alderman Teeling asked if sales tax receivables could be explained. Director Fredrickson explained that the city's fiscal year ends on April 30` however there is a three month lag in the city receiving sales tax revenues. Alderman Teeling asked how the lag and sales tax rebates affect the deficit. Director Fredrickson stated that balances are adjusted due to the rebates. He noted that rebates were booked in the wrong year so the beginning fund balance had to be adjusted. Administrator Olson noted that more sales tax was generated so there were more rebates. Alderman Sutcliff noted that the sales tax rebates were arranged because developers' front funded money for improvements such as streets. This money is being paid back through the rebates. Administrator Olson added that it was a way for growth to pay for itself which has not failed. There were no further comments or questions on the PowerPoint presentation. EXECUTIVE SESSION Mayor Burd entertained a motion to go into Executive Session for the purpose of discussing litigation, when an action against, affecting or on behalf of the particular public body has been filed and is pending before a court or administrative tribunal, or when the public body finds that an action is probable or imminent, in which case the basis for the finding shall be recorded and entered into the minutes of the closed meeting. So moved by Alderman Werderich; seconded by Alderman Golinski. i i The Minutes of the Regular Meeting of the City Council — February 8, 2011— page 5 Motion approved by a roll call vote. Ayes -7 Nays -0 Spears -aye, Plocher -aye, Werderich -aye, Golinski -aye, Teeling -aye, Gilson -aye, Sutcliff -aye The City Council entered Executive Session at 8:35 p.m. The City Council returned to regular session at 8:52 p.m. PUBLIC HEARINGS None. CITIZEN COMMENTS Charlie Walker wondered if the auditors made a comment as to how financially sound the city was. Director Fredrickson stated that the auditors feel that the city is financially stable to continue operations however this was not the focus of the audit. Director Fredrickson explained that the auditors evaluate if the accounting numbers are truthful. It is not their job to evaluate the financially soundness of the city. Mr. Walker stated that the audit makes a distinction between governmental and business accounting. He asked if the city owed $51 million in debt. Director Fredrickson stated that this was correct. Mr. Walker stated that this comes to $3,000.00 /person or about $9,000.00 - $10,000.00 /family living in Yorkville. He felt this was an excessive amount of debt. He noted that real estate taxes will be increased about 70 %. On top of this, the City Council is asking to increase the sales tax in order to take the burden off real estate taxes. He questioned if it really would and commented that the sales tax also passed the debt burden on to neighbors shopping in Yorkville. He did not feel a fair approach was being taken to correct the situation. If the city were a business, it would not be here; it wouldn't exist. He felt the city was being irresponsible and was passing it on to residents. He felt the City Council will be talking about the same issues next year. He stated that he sent the City Council members a letter asking how they were going to address the financial problem. Not even half of the members replied to him. He felt that the City Council, as a group, had not taken action to improve things. Mr. Walker also commented on the proposed ordinance limiting the amount of time for public comment. He reminded the City Council of the Bill of Rights which guarantees free speech. He felt any attempt to limit public comment violated a person's constitutional rights. Mayor Burd explained that the ordinance was not on the agenda tonight because it had been set back to committee. She noted that until the new law had been passed the state did not mandate public comments at committee meetings. She felt that the city was very lenient with allowing public comment compared to other communities. Back to the city's finances, Mr. Walker felt that # 1 - the budget had not been cut enough and that the City Council shouldn't spend money on future endeavors until all debt is paid. He suggested the city review staffing and cut 3% in all area. #2 - Install best management practices and stop the nonsense and #3 - enact an ordinance saying that any expenditure over $1 million needs to go to a referendum and then wait a year after a defeat to put it back on the ballot. Todd Milliron, Cotswold Court, suggested that anyone concerned about the city's financial standing should look at the city's bond rating. He did not feel the current administration was the one to incur the $52 million debt; the down turn was 1999 -2007 during the last administration. He stated that Mr. Walker is a new resident who chose to move to Yorkville and if he is in a new subdivision should accept responsibility because the debts for growth need to be paid for. Yorkville's growth was ambitious and competitive with surrounding communities who are in the same financial position. He did not think it was fair to grandstand and blame this administration for the problem. He stated that everyone is in this together and can get through it together by having a positive attitude. He noted that budget cuts have already been made and maybe further cuts will be needed. Part of the projection for funding was based on the landfill scheme which the residents said no to. Now it is not there so funding is going to have to come from somewhere else. Mayor Burd asked the audience to respect each other's turn to speak. She stated that if this isn't done she will have people removed from the meeting. CONSENT AGENDA 1. Police Reports for October, November, and December 2010 (PS 2011 -01) 2. Request to Sell 1999 Ford Expedition (M12) at Auction (PS 2011 -02) 3. Request to Sell 2000 Ford Crown Victoria (M9) at Auction (PS 2011 -03) 4. Request to Sell 2000 Ford Crown Victoria (M21) at Auction (PS 2011 -04) Mayor Burd entertained a motion to approve the consent agenda as amended. So moved by Alderman Sutcliff; seconded by Alderman Spears. I The Minutes of the Regular Meeting of the City Council — February 8, 2011— pate 6 Motion approved by a roll call vote. Ayes -6 Nays -0 Werderich -aye, Spears -aye, Sutcliff-aye, Gilson -aye, Teeling -aye, Golinski -aye PLAN COMMISSION /ZONING BOARD OF APPEAL None. MINUTES FOR APPROVAL A motion was made by Alderman Sutcliff to approve the minutes of the City Council meeting of January 11, 2011, and the Special City Council meeting of January 11, 2011; seconded by Alderman Spears.\ Alderman Gilson noted an error on page 2 of the January 11, 2011 City Council minutes. Mr. Snobeck's first name should be corrected to Rolph. He also asked for a correction to page 4 of the same minutes. The end of the first paragraph should read "... paying any added fees." Motion unanimously approved as amended by a viva voce vote. BILLS FOR APPROVAL A motion was made by Alderman Sutcliff to approve the paying of the bills listed on the Detailed Board Report dated February 3, 2011, totaling the following amounts: checks in the amount of $237,056.45 (vendors); $6,686.59 (payroll period ending 1/21/11); $227,474.14 (payroll period ending 1/29/11); for a total of $471,217.28 (total); seconded by Alderman Spears. Motion approved by a roll call vote. Ayes -6 Nays -0 Spears -aye, Sutcliff- -aye, Gilson -aye, Teeling -aye, Golinski -aye, Werderich -aye I REPORTS MAYOR'S REPORT Approval of Settlement Agreement (CC 2011 -06) Mayor Burd entertained a motion to approve a settlement agreement and mutual general release by and between Aspen Ridge Estates LLC and the United City of Yorkville and defendants Art Prochaska, James Bock, Dean Wolfer, Joseph Besco, Paul James, Marty Munns, Travis Miller, John Wyeth and Engineering Enterprises, Inc... So moved by Alderman Sutcliff, seconded by Alderman Spears. Mayor Burd apologized for the agreement not being in the agenda packet. She explained that until noon today this was going to be tabled however due to circumstances the agreement needs to be voted on. She proceeded to read a statement about the litigation (see attached). Attorney Orr added that there is a court date on February 20, 2011 where the city has to inform the judge if it has accepted the agreement. Motion approved by a roll call vote. Ayes -6 Nays -0 Teeling -aye, Gilson -aye, Sutcliff -aye, Spears -aye, Werderich -aye, Golinski -aye Mayor Burd stated that copies of the agreement are available and anyone interested should see Administrator Olson. Proclamation for National Engineers Week (CC 2011 -07) Mayor Burd read a proclamation for National Engineers Week (see attached). Bicentennial Riverfront Park Conceptual Site Design (CC 2011 -08) City Park Designer Schraw noted that an incorrect memo was placed in the packets and that the correct one was placed on the City Council members desks. She presented the proposed design for the Bicentennial Riverfiont Park and explained that the staff would like to present an updated park plan at the upcoming Canoecopia event. She stated that the original drawing was submitted with the OSLAD grant and it now needs to be updated so that as funds become available staff has direction as to where to spend them. She noted that the playground will be removed soon due to its poor condition. She stated that the design was presented to the Park Board where some suggestions like showers and changing facilities were made. She stated that a town meeting was being held on February 10, 2011 at 6:00 p.m. in order for public input. The Minutes of the Regular Meeting of the City Council — February 8, 2011— page 7 Administrator Olson added that staff was not applying for any grants; just planning the park. Alderman Werderich stated that he liked the changing area idea however he did not feel a shower facility would necessarily be used. He felt there needed to be a parking lot or staging facility above the dam so that people could paddle up river or head down river. He stated that he spoke with people who are interested in slalom kayaking and suggested that this be investigated. Mrs. Schraw stated that she had heard of temporary slalom gates that can be installed for an event and Administrator Olson added that the city has been offered gates. Alderman Sutcliff stated that it was a great plan which could also be used to encourage economic development in the downtown. She felt that having the plan in place was a boost to the area. She noted that the Park Board suggested configuring the green area as a performance area. Mrs. Schraw indicated that a foundation for bleachers for this area could be installed. Alderman Sutcliff asked if this was the city's property or the IDNR's. Administrator Olson explained that the water facility is the IDNRs and the land is the city's. She asked who was responsible for maintenance of the chute and Administrator Olson stated that the city is responsible to fix the rocks. She asked if someone from the city would be at the canoe event and Administrator Olson stated that the city is sharing space with the Illinois Paddler Council. Alderman Golinski stated that the Park Board discussed the removal of the current playground due to the age of the equipment and its safety. He was concerned with this since the design is a year out. Administrator Olson stated that the equipment needs to be removed due to safety issues but noted that TIF funds are available which can be used for the equipment. Mayor Burd added that the Park Board has discussed leasing the Park Department buildings at the river and putting the money into the capital plan for the park. She also noted that another source of income could be parking meters. Administrator Olson stated that the use of lease money is under discussion by the Park Board however parking meters are not. Riverfront RFP Lease Agreement — First Reading (CC 2011 -10) Administrator Olson stated that staff was looking for direction for the selection of a vender. Geneva Kayak is interested in leasing the facility and Park Board is recommending them. He explained that the lease has been reviewed and approved by the City Council through the RFP. If the City Council approves, the finalized copy of the lease will come to the City Council for a vote. Mayor Burd asked the vender if they were going to change their name and they stated it would be changed to Yorkville Outdoor Center. Alderman Sutcliff asked why there was a first reading on this as it was not an ordinance. Administrator Olson stated that "first Reading" probably wasn't the most appropriate way to put this on the agenda. He explained that he was looking for input from the City Council so the agreement can be finalized. Alderman Werderich noted that the preparation time for the business is crucial. He asked if it should be approved tonight instead of waiting. Administrator Olson stated that it could be approved subject to legal review however he recommended it wait until the next City Council meeting. Alderman Gilson asked how the RFP was advertised. Administrator Olson stated that it was advertised through the city's website, the Yorkville Economic Development Corporation, the Chamber of Commerce, etc. The RFP was not limited to canoe or kayak shops and only two responses were received. Alderman Golinski noted that the rent was $250.00 /month along with 5% of the gross revenue and 20% of gross receipts on programs, rentals, etc. He asked what the projected income would be. A representative from Geneva Kayak stated that the rent was estimated at $2,200.00 to $3,400.00 per month. Alderman Werderich asked about off -season revenue. The representative from Geneva Kayak explained that they are planning other concepts besides kayaking like snow - shoeing and cross country skiing. Alderman Golinski asked if there was any conflict with the warranty deed. Attorney Orr stated that she reviewed the deed and the user is paying a fee to use a park building but residents will the use of the park for free. She explained that parking meters on this property would cause more issues. It was the unanim consensus of the City Council was to award the RFP to Geneva Kayak. i The Minutes of the Regular Meeting of the City Council — February 8, 2011— page 8 Blizzard — Waiver of Water Bill Due Date (CC 2011 -10) Mayor Burd entertained a motion to extend the water bill due date from Thursday, February 3, 2011 to Tuesday, February 8, 2011 due to the blizzard. So moved by Alderman Werderich; seconded by Alderman Golinski. Motion approved by a roll call vote. Ayes -6 Nays -0 Golinski -aye, Teeling -aye, Gilson -aye, Sutcliff -aye, Spears -aye, Werderich -aye NIMEC Bid (CC 2011 -11) Mayor Burd entertained a motion to authorize the City Administrator or Finance Director to approve the lowest bid, at their discretion and to sign contracts to secure the provisions of electricity from the lowest bidder as presented by NIMEC, effective only for the current NIMEC bid cycle, which ends on April 1, 2011. So moved by Alderman Spears; seconded by Alderman Golinski. Motion approved by a roll call vote. Ayes -6 Nays -0 Gilson -aye, Sutcliff- -aye, Spears -aye, Werderich -aye, Golinski -aye, Teeling -aye CITY COUNCIL REPORT None. CITY ATTORNEY'S REPORT No report. CITY CLERK'S REPORT No report. CITY TREASURER'S REPORT No report. CITY ADMINISTATOR'S REPORT Administrator Olson reported that a Special City Council Meeting was being planned for February 26, 2011 at 9:00 a.m. to go over the budget. He also apologized for the two late additions to the packet. DIRECTOR OF PARKS & RECREATION'S REPORT No report. FINANCE DIRECTOR'S REPORT No report. CITY ENGINEER'S REPORT City Engineer Wywrot reported that IDOT opened bids for the removal of two more homes along Route 47. The buildings will be demolished late March 2011. DIRECTOR OF PUBLIC WORKS REPORT Mayor Burd read a few positive emails about snow removal and helpful Public Works employees. She asked the City Council for a show of recognition for the employees. CHIEF OF POLICE'S REPORT Chief Hart reported that a Yorkville detective was appointed as the county -wide SWAT leader. He expressed his pride in the selection. COMMUNITY DEVELOPMENT DIRECTOR REPORT Director Barksdale -Noble reported: • The final meeting for the Building Code Update Committee will be held and the next step is bringing the information to the City Council. • She attended a workshop about vacant property. It covered the laws that apply and aggressive tactics that can be used on vacant property. • On February 5, 2011 there was a Kendall County Regional Plan Commission meeting to discuss projects and goals. There were presentations from the municipalities of their plans. COMMUNITY RELATIONS OFFICER'S REPORT No report. i The Minutes of the Regular Meeting of the City Council — February 8, 2011— page 9 COMMUNITY & LIAISON REPORT Kendall County Regional Plan Commission Alderman Werderich reported that he attended the Kendall County Regional Plan Commission with Director Barksdale Noble. Highpoints discussed were the results of the Kendall County Land Plan survey and a protected agricultural limited development district. Three communities, Joliet, Montgomery and Yorkville, gave reports on development including growth in business and requests for smaller lots and houses. Meeting with Joliet Mayor Burd reported that she met with the Joliet's city manager to discuss a boundary agreement. Administrator Olson and Director Barksdale -Noble will be sitting down with Joliet to work out details and then this will be brought to the City Council. Sale Tax Increase Mayor Burd reported that due to the referendum asking for an increase in the sales tax, the Chamber of Commerce sent out a questionnaire asking which was preferred; an increase in sales tax or real estate tax. So far the results have been nineteen in favor of a sales tax increase, 4 in favor of an increase to property taxes, one for an increase in both taxes and one not wanting to pay any additional taxes whatsoever. Mayor Burd added that on February 28, 2011 at 7:00 p.m. there will be a public forum to discuss the sales tax referendum. COMMITTEE REPORTS PUBLIC WORKS COMMITTEE REPORT No report. ECONOMIC DEVELOPMENT COMMITTEE REPORT Ordinance 2011 -05 Approving an Intergovernmental Agreement for Eldamain Road Reconstruction (EDC 2010 -43) A motion was made by Alderman Golinski to approve an ordinance Approving an Intergovernmental Agreement for Eldamain Road Reconstruction and authorize the Mayor and City Clerk to execute; seconded by Alderman Spears. Alderman Gilson noted that Plano is paying $3.4 million and he asked if there would be a recapture agreement. Administrator Olson explained that this was front funded by the Menard's facility and Yorkville owes $3.8 million. Alderman Gilson was concerned that the city was a relying on future growth to pay for the road. What if this does not materialize? Attorney Orr explained if there is no growth; the city will not pay anything. The road will only be paid by the recapture agreement when the area develops. If this never occurs than the city does not have to pay. Motion approved by a roll call vote. Ayes -6 Nays -0 SutclifF aye, Spears -aye, Werderich -aye, Golinski -aye, Teeling -aye, Gilson -aye PUBLIC SAFETY COMMITTEE REPORT No report. ADMINISTRATION COMMITTEE REPORT No report. ADDITIONAL BUSINESS Chamber of Commerce Survey Alderman Spears asked if the City Council could get a copy of the survey that the Chamber of Commerce sent out along with the names of the business. Mayor Burd explained that the survey was done via email and that some of the businesses did not include their names but that she would get them to the City Council. The Bond Buyer Alderman Sutcliff reported that she placed an article from the Bond Buyer (see attached) regarding the vote on the sewer bonds. ADJOURNMENT Mayor Burd entertained a motion to adjourn the meeting. So moved by Alderman Werderich; seconded by Alderman Golinski. The Minutes of the Regular Meeting of the City Council — February 8, 2011— page 10 Adjournment of the meeting was unanimously approved by a viva voce vote. Meeting adjourned at 10:13 p.m. Minutes submitted by: Jacquelyn Milschewski, City Clerk City of Yorkville, Illinois REGULAR CITY COUNCIL MEETING February 8, 2011 PLEASE PRINT NAME OR BUSINESS: 1 u6-- 4 1 x th0!y mq-v�� r I 6 A dd SIGNIN REGULAR CITY COUNCIL MEETING February 8, 2011 PLEASE PRINT NAME: SUBDIVISION OR BUSINESS: >n PLO I� �5 E (bJJ 64w va ka` 4K . i SIGNIN REGULAR CITY COUNCIL MEETING Public Comment February S, 2011 PLEASE PRINT NAME: SUBDIVISION OR BUSINESS: i SIGNIN 1 United City of Yorkville FY 09/10 Audit City Council February 8, 2011 Background Discussion outlined in February 4, 2011 memo from Bart Olson to City Council in City Council packet for tonight's meeting http: / /yorkvi Ile, il.us /2011 MeetingM in utesAgendasandPackets, php FY 09/10 runs from: May 1, 2009 to April 30, 2010 1 How did we get here? Definition of "here" From estimating a $0 general fund fund balance in February 2010 to a negative N$492,000 fund balance as of April 30, 2010 For a more comprehensive definition of "here," check past City Council and Administration Committee packets for the past year and stay tuned for the FY 11/12 budget discussions over the next few months How did we get here? Four reasons in FY 09/10 Bad debt writeoffs Sales Tax incentive agreements Police capital fund loan rejected Health insurance and salary budget estimates were wrong 1 S How did we get here? Bad Debt Dollar amounts listed on our books as assets (accounts receivable) that were not received When those assets are not received, or not expected to be received, they are turned into "bad debt" and are removed from our financial statements as an asset How did we get here? Bad Debt The City's bad debt policy has a general timeframe of 12 months to wait from declaring something bad debt and writing it off the books.. Policy instituted in 2008. An example of bad debt: City enters into an agreement to complete a piece of infrastructure, with a commitment from a developer to reimburse by a certain date The commitment, because it is within a legal document, is listed as a receivable (asset) in our books The reimbursement date passes One year later, the receivable is declared a bad debt and is written down 1 How did we get here? Bad Debt This form of asset tracking is the accepte" way of government budgeting and auditing How did we get here? Bad Debt None of the bad debt written off this year is "new" If it's not a "new" issue, why are we discussing it? Because our staff and the auditors decided to write -off a large percentage of the remaining bad debt that is not tied to the landfill application This gives us a more clear picture of our fund balance 1 How did we get here? Sales tax "Prior period adjustment" Sales tax rebates were booked in FY 09/10 that should have been booked in FY 08/09 Impact on FY 09/10 audit is $177,283 Kendall Marketplace was a larger percentage of total sales tax than expected Impact on FY 09/10 audit is $153,140 How did we get here? Police capital loan During revised budget discussions, the police capital fund was going to loan the general fund $103,000 would be repaid over next four fiscal years Loan was to be booked as revenue Auditors and staff decided after the fact that it wasn't proper, so it was not completed 1 How did we get here? Health insurance and salary budget estimates The easiest issue to understand Health insurance and salary budget estimates were wrong It appears figures were not updated as employees left the City mid -year How do we get to where we want to be? With a negative fund balance and poor cash position, budget surpluses must be run each year in the general fund for the next few fiscal years With layoffs, other non - personnel cuts, new revenues (OTB, cell towers) the City is better positioned to run budget surpluses in the general fund for the next few fiscal years More adjustments must be made, and will during the FY 11/12 budget discussion P6 1 How do we get to where we want to be? The budget process FY 11/12 Tentative Budget Timeline City Administrator and Finance Director meeting with the Mayor and department heads this next week Available for public inspection Friday, February 18 Saturday, February 26 at gam - Special City Council March 8 - Budget public hearing March 22 - City Council discussion April 12 - City Council discussion April 26 - City Council (last possible date to approve budget) For the past two and a half years, the City of Yorkville has been engaged in litigation related to the proposed Aspen Ridge Estates development. The City has vigorously contested its liability and the alleged liability of the individuals named in the suit, and also brought a counterclaim against the plaintiff developer. In October of 2010, the city's insurer, the Illinois Municipal League, announced its intention to file a declaratory action seeking a judicial determination that Aspen Ridge's claims were not covered by the City's insurance policy. After carefully considering the substantial costs and uncertainties inherent to continued litigation, all of the parties opted to settle the case. The settlement resolved and released all claims that were or could have been brought by any party to the litigation. In the interest of putting an immediate end to the litigation, Yorkville agreed to contribute $100,000 toward the costs of settlement. These funds will be paid in two parts; $75,000 is being advanced by the City's insurer, and will be repaid in May of 2011. The remaining $25,000 will be paid directly by the City in May of 2011. Though this settlement will undoubtedly have a significant impact on the already strained City budget for fiscal year 2011 -2012, this settlement is nonetheless in the best interest of the taxpayers, who might have faced far more in litigation expenses before even reaching a trial on the merits of the case. ► �� � �. .�� ` '. • /�� /Ss u.►� ��� o �� ��..oi�� ��....��� ��..o������ �o�►� w.o� ►��w�oo� ��p.� �� f,����.u.������1sa ,dl� sue � � 1 •wnrr• � / purer• � 1 •uunr• � 1 •urnrr• � • •nuur• � � •nr. ■r• 1 � •.uurr• � • •cur n• � • •uunr• 1 � •,nnrr• � � •aunq � • • •r.u. � ` \ \: it 4.+ 11! Il Office of the Mayor aoa; + ��i01 ►►; { United City of Yorkville 1141 ; 800 Game Farm Road , / 11 . 1 I Yorkville Illinois 60560 I/oe••�: I . 1 l l j l j l +1 �� � 1 ► 1 1 1 1 , Mayor Valerie Burd I 1 e .; I •��ar) 1 1 1 1 4 ii�:: United City of Yorkville`'' ►'� •��'� 11 ► 1,� ►� Proclamation 1 1 ► ii i ::' • ' I I '''::�al�l � I ► I'1'1':• ' RN 6 WHEREAS, engineers have used their scientific and technical �► knowledge and skills in creative and innovative was to improve ► •�' ' societ s quality of life; and Y q Y �.:'•, I III ;I 1 + ►/► 4 i ► ► ►' °aO; WHEREAS engineers face the major technological challenges of ::; g J g g 1141 +1�� our time — from rebuilding towns devastated by natural disasters to i �` ��►1111 revolutionizing our infrastructure and technological progress; and (u. .•� i �• " of � i + � ► 1 1 I I 111►1'1:� 1�` X jl ...� WHEREAS, engineers are encouraging our young math and ll'I science students to realize the practical power of their knowledge; ►I + ,1 1 � and ;' �;I + j ► 1 1 1► j ► + 1 / WHEREAS, we look more than ever to engineers and their •;� + j► 1 ► ,,, r;• ., knowledge and skills to meet the challenges of the twenty -first •;�,,, 1 century. ���� W O 411. 11 11 ►� ►�% '� ���;1 / 1 I llH' NOW, THEREFORE, I, Valerie Burd, as Mayor of the United City of 144 + /,.H- I .'te / +111 if Yorkville, on behalf of its citizens and City Officials, do hereby llf,l I p y �� ►�,,:.- proclaim the week of February 20 -26, 2011 to be National � • � �� I Engineers Week in all of Yorkville, Illinois. ;1 I 111 +�0 'g' 1 th 11 i '� !I I ►��'••' Dated this 8 day of February, 2011 A.D. •� "��1 i ll't Mayor Valerie Burd I� �E►�,I;111 I '', `--� + ►111 I ' ..,,.,.:. •� �� ���.:: r1�I�L�.: r1�I�ti�..: r1, I���... r1�I�t�..✓ I�I���..: i1�I�L� .::r1�I�L�:..r1�I�L�..: . e`�� <e..• i :•�•::_ : o• :: _::• �•::: �:• �• ::_: :•�• ::�.:•�•::: :•�•::�:•�• ::;;;:!i /7% \ ru•ur � —" �� Yorkville Nixes Sewer Hike - Bond Buyer Article 2/3/119:06 AM THE BONiD BuYER THE DAILY NEWSPAPER OF PUBLIC FINANCE Yorkville Nixes Sewer Hike Wednesday, February 2, 2011 I By Yvette Shields The Yorkville City Council last week voted against asking residents to cover a $264,000 shortage in revenue needed in the city's sewer fund to cover debt payments coming due next year, according to published reports. The council voted 4 -4 to impose the fee. While Mayor Valerie Burd typically would cast the deciding vote in a tie, she was absent, so the measure failed. The city, which is 50 miles west of Chicago, last month approved a ballot measure asking voters to approve a 1% sales tax increase to cover sewer bond payments. If voters approve the tax hike, Yorkville has said it could then afford to abate a portion of property taxes that go to repay city sewer debt. © 2011 The Bond Buyer and SourceMedia Inc., All rights reserved. Use, duplication, or sale of this service, or data contained herein, except as described in the subscription agreement, is strictly prohibited. Trademarks page. Client Services 1-800-221-1809, 8:30am - 5:30pm, ET For information regarding Reprint Services please visit: http: / /ticense.icopyright. net /3.7745 ?icx_id= 20090817FNNRUTWS http: / /www.bondbuyer.com /issues /120_22/- 1022783- 1.html ?zkPrintable =true Page 1 of 1