Board of Trustees

MAYOR: Michelle I. Nelson | VILLAGE CLERK: Cecil Porter | VILLAGE MANAGER: Bridget A. Wachtel TRUSTEES: Gary Daggett | Kevin Dorsey | Rosalind Henderson Mustafa | George Lofton | James Mitros | Carolyn D. Rodgers AGENDA FOR THE REGULAR MEETING OF THE BOARD OF TRUSTEES OF THE VILLAGE OF FLOSSMOOR, ILLINOIS MONDAY, MARCH 9, 2026 • 7:00 PM • VILLAGE HALL Join Zoom Meeting: https://us02web.zoom.us/j/85210894513?pwd=uZUHbLuNGHvJ6BUE21v70fK1RLbeBa.1 ID: 852 1089 4513 Passcode: 60422 Or join by phone (312) 626-6799 CALL TO ORDER ROLL CALL RECOGNITIONS AND APPOINTMENTS PUBLIC PRESENT WISHING TO ADDRESS THE BOARD CONSENT AGENDA 1. Approval of the Minutes of the Meeting Held on February 16, 2026 2. Approval of the Minutes of the Special Meeting Held on February 19, 2026 3. Presentation of Bills for Approval and Payment as Approved by the Finance Committee (March 9, 2026) 4. Consideration of a Resolution of the Village of Flossmoor, Cook County, Illinois, for Construction on State Highway (2026-2027) 5. Consideration of an Ordinance of the Village of Flossmoor, Cook County, Illinois, Approving a Second Escrow Agreement By and Among the Village of Flossmoor, the Vollmer Group LLC and the Flossmoor Office Center Condominium Association • If you plan on attending a Village Board meeting and need an accommodation, please call 708-798-2300 or TDD 708-647-0179 at least one full business day prior to the meeting. • 2800 Flossmoor Road, Flossmoor, Illinois 60422 | Phone: 708.798.2300 | TDD: 708.647.0179 | Fax: 708.798.4016 | www.flossmoor.org Page 1 of 76  REPORTS OF COMMITTEES, COMMISSIONS AND BOARDS ACTION ITEMS ACTION ITEMS 6. Consideration of a Liquor License Request for a Class AB-VGP Liquor License (Beyond Borders Café) DISCUSSION ITEMS 7. Discussion of the FY27 Preliminary Budget OTHER BUSINESS EXECUTIVE SESSION ADJOURNMENT OF MEETING • If you plan on attending a Village Board meeting and need an accommodation, please call 708-798-2300 or TDD 708-647-0179 at least one full business day prior to the meeting. • 2800 Flossmoor Road, Flossmoor, Illinois 60422 | Phone: 708.798.2300 | TDD: 708.647.0179 | Fax: 708.798.4016 | www.flossmoor.org Page 2 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE REGULAR MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 16, 2026 VILLAGE HALL February 16, 2026 7:00 PM DRAFT Village Clerk Porter took roll. There was a quorum. PRESENT: Mayor Nelson and Trustees Daggett, Dorsey, Lofton, Mitros, Mustafa, and Rodgers. ABSENT: None ALSO PRESENT: Ann Novoa, Finance Director Carl Estelle, Chief of Police Scott Bugner, Director of Bldg & Zoning Douglas Merkle, Deputy Chief of Police John Brunke, Public Works Director Matt Bert, Asst Fire Chief Bridget Wachtel, Village Manager Joe Miller, Village Attorney Jonathan Bogue, Asst Village Manager Stephanie Wright, Community Engagement Manager GENERAL STATEMENT/RULES OF ORDER (Announced by Mayor Nelson): The meeting was streamed via Zoom. Mayor Nelson reviewed the public comment policy, which is available on the Village website. RECOGNITIONS AND APPOINTMENTS: Agenda Item #1: A Proclamation Declaring February 2026 as Black History Month Mayor Nelson read the Village of Flossmoor’s Proclamation for Black History Month and discussed the Village’s focus on recognizing teachers for the proclamation this year. The following teachers are amongst those nominated for recognition and present to accept the proclamation: • Mr. Brian Stanley: Director of Workforce Empowerment Initiative Grant at Prairie State College. Mr. Stanley is a coach with Flossmoor Baseball & Softball and also coaches basketball with HF Park District. • Ms. Cheryl Shackelford: A Middle School Social Science Teacher at Chicago Public Schools with 33 years teaching experience. Ms. Schackelford serves as a Social Science chair and Student Council sponsor and offers mini book talks with her students. She has been a Flossmoor resident for 36 years. • Ms. Danielle Brasfield: Lead Teacher, CICS Wrightwood Middle School with a 24-year teaching history. Ms. Brasfield is a published author and provides consulting on self- publishing, editing, formatting and support for aspiring authors through Antoinette Books & Educational Consulting, LLC. Page 1 of 11 Page 3 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE REGULAR MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 16, 2026 VILLAGE HALL February 16, 2026 7:00 PM DRAFT • Mr. Ron Wright: 6th Grade Math Teacher at Parker Junior High School. Mr. Wright coaches multiple sports. He is an author and public speaker who focuses on financial literacy education and has been a Flossmoor resident for nearly 21 years. For more information about each of these educators, please go to the Village’s website: https://www.flossmoor.org/409/Flossmoor-Black-History-Month Agenda Item #2: Consideration of an Appointment to the Green Commission Mayor Nelson called for a Motion to approve the appointment of Courtney Tillman to the Village of Flossmoor’s Green Commission. Trustee Mustafa so moved, Trustee Daggett seconded. Mayor Nelson provided information about Ms. Tillman’s professional background and community involvement and asked the Board for any questions or concerns. The Board expressed their appreciation to Ms. Tillman for her willingness to volunteer and be an active part in our community. A vote on the Motion was presented and passed unanimously by a roll call vote. AYES: Trustees Daggett, Dorsey, Lofton, Mitros, Mustafa, and Rodgers ABSENT: None ABSTAIN: None NAYS: None PUBLIC PRESENT WISHING TO ADDRESS THE BOARD: a. Jackie Riffice: Provided information about her book club and invited all to attend the next meeting. UPDATE FROM FINANCE DIRECTOR, ANN NOVOA: Mayor Nelson, before moving to the Consent Agenda, requested Ann Novoa, Finance Director, to provide an update on Cook County’s property tax disbursements. Finance Director Novoa advised that the Village has not received any disbursements since the last board meeting. Mayor Nelson reported that they have met with many Cook County officials about this problem and Cook County’s promises have not been kept. Mayor Nelson requested the Board to sign a letter on behalf of the Village to send to Toni Preckwinkle, President of the Cook County Board of Commissioners to address Cook County’s failure to distribute all of the property tax payments. The Board expressed outrage and frustration at Cook County’s breach of the public trust and willingness to put the Village in financial peril and unanimously agreed to sign and send to Toni Preckwinkle the proposed letter. Page 2 of 11 Page 4 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE REGULAR MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 16, 2026 VILLAGE HALL February 16, 2026 7:00 PM DRAFT CONSENT AGENDA: Mayor Nelson called for a Motion to approve Consent Agenda Items #3-5. Trustee Lofton so moved, Trustee Dorsey seconded. Mayor Nelson asked if there were any items on the Consent Agenda that were requested to be removed for discussion, and there were none. A vote on the Motion was presented and passed unanimously by a roll call vote. AYES: Trustees Daggett, Dorsey, Lofton, Mitros, Mustafa, and Rodgers ABSENT: None ABSTAIN: None NAYS: None REPORTS OF COMMITTEES, COMMISSIONS AND BOARDS: Mayor Nelson wished everyone a Happy Lunar New Year and reported that Flossmoor’s Community Relations Commission, Flossmoor Public Library, and HF High School’s Mandarin program hosted a successful Lunar New Year Celebration on Saturday, February 14, 2026, at Flossmoor Public Library. Mayor Nelson recognized Community Relations Commissioner, Molly Deugaw, for the extra steps she took to sponsor a Korean performer/dancer, and for providing red envelopes, containing two-dollar bills to the children who attended the celebration that are meant to bring good luck in the upcoming year. ACTION ITEMS: Agenda Item #6: Consideration of an Ordinance of the Village of Flossmoor, Cook County, Illinois, Approving a Development Agreement by and between the Village of Flossmoor and OBE Studios, LLC Mayor Nelson called for a Motion to approve Agenda Item #6. Trustee Daggett so moved, Trustee Lofton seconded. Village Manager Wachtel presented this Action Item. Village Manager Wachtel advised that the Brewers were applying for a Small Business Administration loan and had additional steps that needed to be completed for this application process. Village Attorney Kathi Orr revised the necessary terms in the Village’s agreement with the Brewers so that the Brewers could pursue their financing. The proposal for this action item continues to be in line with the Village’s economic incentive policies. The Brewers appeared before the Board to answer any questions. Mayor Nelson asked the Board if there were any questions and the Board continued to express support and excitement about this development project. Page 3 of 11 Page 5 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE REGULAR MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 16, 2026 VILLAGE HALL February 16, 2026 7:00 PM DRAFT A vote on the Motion was presented and passed unanimously by a roll call vote. AYES: Trustees: Daggett, Dorsey, Lofton, Mitros, Mustafa, and Rodgers ABSENT: None ABSTAIN: None NAYS: None Mr. Brewer expressed his thanks and appreciation to the Village of Flossmoor for supporting his proposed business development. DISCUSSION ITEMS: Agenda Item #7: Discussion of a Vehicle Use Fee in lieu of Vehicle Stickers Mayor Nelson invited Finance Director Novoa to present this discussion item. Finance Director Novoa gave a presentation about the decline in vehicle sticker revenue that has taken place over the past few years. Historically, this was the largest license and permit revenue received by the Village to support general fund costs. Director Novoa provided information about the reasons the Village needed funds from the vehicle sticker program, the decline in vehicle sticker funds, the community response to having to pay for vehicle stickers, enforcement policies for vehicle stickers, and alternatives to the vehicle sticker program. Director Novoa recommended that the Village replace the vehicle sticker program with a vehicle use fee that is collected through the utility billing system, by way of the fee being added to a monthly utility bill. Director Novoa explained that monthly utility billing will be implemented at the beginning of the fiscal year. Mayor Nelson discussed the Village’s past enforcement attempts for the vehicle sticker program and requested the Board for any comments and questions. The Board had questions about the different methods the Village has used to enforce the vehicle sticker program, how the fees would be applied to multi-car households, and the difference in fees for residences and businesses and the central business district. Trustee Dorsey requested that the Village consider concessions for senior citizens and those on a fixed income. The Board agreed with Director Novoa’s recommendations to have an ordinance drafted to add the vehicle sticker registration fees to utility bills. Attorney Miller stated his office would work to have the ordinance drafted for the Board’s consideration at an upcoming meeting March. Page 4 of 11 Page 6 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE REGULAR MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 16, 2026 VILLAGE HALL February 16, 2026 7:00 PM DRAFT Agenda Item #8: Presentation of the Strategic Plan Update (May 2025 - January 2026) Village Manager Wachtel provided the Board with a nine-month update on the Village’s Strategic Plan that was adopted for the period of 2022 through 2026. The strategic plan, including updates, can be found on the Village’s website at: https://www.flossmoor.org/534/Strategic-Plan-2022-2026 The following list discusses significant accomplishments noted under different areas of the report for the Strategic Plan update. #1 Finances and Services: • Infrastructure grant of $1,000,000: MWRD Stormwater Partnership Program participation for Phase 5 of the Flossmoor Road Viaduct Drainage Improvements Project. • Grants awarded to the Police Department include: o $41,330 IDOT grant to conduct trafficenforcement operations throughout the year. Since receiving this grant, officers have made 765 vehicle stops and issued 833 citations. o $10,000 ComEd Powering through Safe Community grant provided for the purchase of flashing beacons to increase safety measures for students and pedestrians to safely travel across crosswalks at four busy locations. o $42,000 Illinois Attorney General’s Organized Retail Theft Crime grant to purchase closed-circuit security cameras to be installed within our retail corridors. • Awarded the GFOA Certificate of Achievement for Excellence in Financial Reporting for the 47 consecutive year. • Grant of $250,000.00 through Senator Harris for capital infrastructure that has been tentatively designated for the Dartmouth bridge project. • Implementation of new technology for service delivery that includes a new customer service portal to make online payments. Page 5 of 11 Page 7 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE REGULAR MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 16, 2026 VILLAGE HALL February 16, 2026 7:00 PM DRAFT • A new Graphic Information Services (GIS) project to collect data about Village assets, inventory, and operations and to share this information with staff, the Board, and the public. The GIS program includes a tree inventory and sign inventory, and information about the Village’s tree management system. #2 Infrastructure & Housing: Highlights include the following: • Completed the FY26 MFT Street Resurfacing Project at a final cost of $589,971.94. This project included the asphalt resurfacing of 1.46 miles of streets, and other ancillary pavement patching, ADA sidewalk repairs, curb and gutter repairs, and restoration. • Completed the FY26 MFT Pavement Crack Filling Program at a cost of $31,679.39. This project included the pavement crack filling of 10 streets at a total distance of 3.99 miles. • Completed the FY26 Sidewalk Replacement Program at a cost of $95,465.61. This project included the replacement of approximately 330 sidewalk squares on Western Avenue between Flossmoor Road and Vardon Lane and at other locations throughout the Village. • Substantially completed the Downtown Streetscape Project at an estimated final cost of $2,098,058. The project was offset by an IDOT ITEP grant in the amount of $1,184,456. • Completed the Flossmoor Road Sanitary Sewer Relocation Project at a cost of $422,423. This project included the relocation of the public 15-in. sanitary sewer that ran under the Civic Center Building from the public alley to the west and out to Sterling Avenue. The project relocated the sanitary sewer to run west down the alley and south across the east side of the vacant land in a public utility easement, adjacent to 2609 Flossmoor Road, and out to Flossmoor Road. • Completed Phase 3 of the Flossmoor Road Viaduct Drainage Improvements Project, which included the construction of the large-scale 84-in. storm sewer on Lawrence Crescent from the Heather Hill basin to Maryland Avenue. The cost of this phase was $1,758,536, which was offset by $1.5 million in DCEO grants. • Began the engineering for the Dartmouth Bike Bridge Replacement Project. This project includes the replacement of the Dartmouth Bike Bridge, bike path on both sides of the bridge, and the bank stabilization of Butterfield Creek. The estimated project cost is $690,800. The project will be partially offset by an IEPA Section 319 grant in the amount of $111,600, which is meant to cover a portion of the cost of the bank stabilization. Page 6 of 11 Page 8 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE REGULAR MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 16, 2026 VILLAGE HALL February 16, 2026 7:00 PM DRAFT • Featured in Crain’s Chicago Business for being one of the few Chicagoland locations that had a significant increase in home values in 2025. Flossmoor home values rose on average 12% last year. • Utilizing full authority to enforce compliance with the Village’s adjudication program for enforcement of ordinances for property maintenance, the timeline for the remediation process, and collection of fines. #3 Economic Development & Business Retention: Highlights include the following: • Approved the construction of Chipotle and 7 Brew restaurants on a Meijer outlot with construction beginning this spring and scheduled openings in the fall. • Entered into a development agreement with OBE Studios for Villageowned properties on 198 Street. • Continued to guide the development of Flossmoor Town Centre LLC, the proposed development of townhomes and a cafe for the Village-owned property on Flossmoor Road. • Continued to guide a development agreement with On-the-Fly Hospitality for their proposal of Flossmoor Smokehouse restaurant for the Village-owned property at 19725 Governors Highway. • Entered a Memorandum of Understanding with the Southland Development Authority to market and secure letters of interest for Village-owned properties on Vollmer Road. • Vigorously promoted and supported central business district businesses heavily throughout the Downtown Streetscape Project with weekly construction updates, an interactive GIS map, additional parking spaces, promotional signage, social media posts, enews features and a special incentive program for shoppers and diners throughout the month of September. • Offered an economic incentive to provide an accessible restroom, plumbing for the bathroom and sink, to Beyond Borders Cafe (1036 Sterling), which opened in summer 2025. • Offered an economic incentive for HVAC replacement and Ansul System Repairs to Flossmoor Social (1040 Sterling), which opened in fall 2025. Page 7 of 11 Page 9 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE REGULAR MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 16, 2026 VILLAGE HALL February 16, 2026 7:00 PM DRAFT #4 Inclusivity Highlights include the following: • Launched a yard sign initiative to foster community pride and promote the “Love Flossmoor” message through the Community Relations Commission. • Hosted a National Hispanic Heritage Month event in partnership with the Flossmoor Public Library in September, modeled after the successful Lunar New Year event. The Village collaborated with School District 161’s Bilingual Parent Action Committee to help shape and coordinate the event. Feedback from participants indicated the program felt more intentional, educational and meaningful than prior efforts. • Various Green programs that are discussed in detail in the report. • Intergovernmental Food Drive for township food pantries. • Redesigned the printed Village quarterly newsletter for better readability, more graphic interest and expanded calendar information. The newsletter is now planned, written and designed in house. • Partnership with Grand Prairie Services for mental health services on 911 calls. #5 Staff Highlights include the following: • Filled seven vacancies in the Police Department: four full-time officers, one fulltime CSO, one part-time records clerk and one crossing guard. • Created a full-time CSO position by combining two part-time positions to enhance non- sworn Police assistance, including traffic duties, downtown patrol and support with Police technology. • Continued the successful Fire Department Intern Program, demonstrating measurable success and long-term value. To date, the program has produced 17 certified Firefighter/EMTs and has strengthened a diverse pipeline of qualified candidates committed to serving the community and the region. • Adoption of new wellness program for Staff through personified health. Page 8 of 11 Page 10 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE REGULAR MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 16, 2026 VILLAGE HALL February 16, 2026 7:00 PM DRAFT Mayor Nelson thanked Village Manager Wachtel and Village staff for their hard work in achieving the goals in the Strategic Plan and made specific mention of: • Since 2021, the Village has received approximately $8.35 million in grants for capital equipment expenses and infrastructure projects. • The Board having approved for incentives for Flossmoor Social, and Beyond Boarders, and the excellent publicity achieved by these two businesses that promotes the Village. • Staff achievements, including the SHRM certification by Assistant Finance Director, Malea Calvert. Mayor Nelson asked the Board if there were any comments or questions. The Board expressed extreme gratitude to Village Manager Wachtel and staff for meeting and exceeding the goals of the Village’s Strategic Plan and the high level of success for these accomplishments. The Board had much praise for the large number of grants the Village has been awarded for capital equipment and infrastructure projects. The Board characterized the Village’s progress on its Strategic Plan as a massive success. OTHER BUSINESS: Agenda Item #9: A Motion to go into Executive Session to Discuss the Employment of Specific Individuals, Property Acquisition, and Litigation Mayor Nelson called for other business and the Board responded as follows: Trustee Rodgers: Expressed thanks to the Village for doing a great job. Trustee Mustafa: In agreement that the Village is a “pretty cool place”, is glad to be here, and thanked everyone for doing a great job. Recognized the Village’s Proclamation for Black History Month and to further amplify this proclamation, honored Carter G. Woods, who was the second African American to graduate from Harvard University. The accomplishments of Carter G. Woods include, on February 7, 1926, launching what is now known as Black History Month to celebrate African American history and contributions. Trustee Daggett: Thanked Mayor Nelson for attending the Cook County Board Meeting to put pressure on Cook County to timely issue property tax payments. Expressed appreciation for Ms. Riffice’s book club. Trustee Dorsey: Proud to be a part of the Village. Page 9 of 11 Page 11 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE REGULAR MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 16, 2026 VILLAGE HALL February 16, 2026 7:00 PM DRAFT Trustee Lofton: No comments. Trustee Mitros: Recognized Mayor Nelson for promoting the Village and working to achieve the goals of the strategic plan. Clerk Porter: No comments Village Attorney Miller: No comments Village Manager Wachtel: No comments Mayor Nelson further announced the following: • Wished Muslim friends and neighbors a blessed Ramadan, and Christian friends and neighbors a blessed Lent. • The next Village Board meeting has been rescheduled from March 2, 2026, to March 9, 2026. EXECUTIVE SESSION: Mayor Nelson called for a motion to move to Executive Session, to discuss the acquisition of property. Trustee Mustafa so moved, and Trustee Daggett seconded. The motion passed by a unanimous roll call vote. AYES: Trustees Daggett, Dorsey, Lofton, Mitros, Mustafa, and Rodgers ABSENT: None ABSTAIN: None NAYS: None The Board entered into Executive Session at 8:39 p.m. REGULAR MEETING: The Board returned from Executive Session and Mayor Nelson called the meeting to order at approximately 9:07 p.m. PRESENT: Mayor Nelson and Trustees Daggett, Dorsey, Lofton, Mitros, Mustafa, and Rodgers ABSENT: None ALSO PRESENT: Page 10 of 11 Page 12 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE REGULAR MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 16, 2026 VILLAGE HALL February 16, 2026 7:00 PM DRAFT Bridget Wachtel, Village Manager Jonathan Bogue, Asst Village Manager Joe Miller, Village Attorney ADJOURNMENT OF MEETING Mayor Nelson called for a motion to adjourn the meeting. Trustee Mitros so moved, seconded by Trustee Daggett. All were in favor, none opposed. AYES: Trustees Daggett, Dorsey, Lofton, Mitros, Mustafa, and Rodgers ABSENT: None ABSTAIN: None NAYS: None The Regular Meeting was adjourned at approximately 9:07 p.m. Respectfully Submitted, Cecil E. Porter Village Clerk Page 11 of 11 Page 13 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE VILLAGE BOARD SPECIAL MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 19, 2026 VILLAGE HALL February 19, 2026 6:15 PM DRAFT Mayor Nelson called the meeting to order at 6:15 p.m. Village Clerk Porter took roll. There was a quorum. PRESENT: Mayor Nelson and Trustees Daggett, Dorsey, Lofton, Mitros, Mustafa, and Rodgers. ABSENT: None ALSO PRESENT: Bridget Wachtel, Village Manager Joe Miller, Village Attorney Jonathan Bogue, Asst Village Manager GENERAL STATEMENT/RULES OF ORDER (Announced by Mayor Nelson): Mayor Nelson reviewed the public comment policy, which is available on the Village website. PUBLIC PRESENT WISHING TO ADDRESS THE BOARD: None EXECUTIVE SESSION: Mayor Nelson called for a motion to move to Executive Session, pursuant to 5 ILCS 120/2(c)(16) for self-evaluation, practices and procedures or professional ethics. Trustee Mitros so moved, and Trustee Daggett seconded. The motion passed by a unanimous voice vote. AYES: Trustees Daggett, Dorsey, Lofton, Mitros, Mustafa, and Rodgers ABSENT: None ABSTAIN: None NAYS: None The Board entered into Executive Session at 6:17 p.m. REGULAR MEETING: The Board returned from Executive Session and Mayor Nelson called the meeting to order at approximately 8:32 p.m. PRESENT: Mayor Nelson and Trustees Daggett, Dorsey, Lofton, Mitros, Mustafa, and Rodgers ABSENT: None Page 1 of 2 Page 14 of 76  MINUTES OF MAYOR NELSON AND BOARD OF TRUSTEES FOR THE VILLAGE BOARD SPECIAL MEETING OF THE VILLAGE OF FLOSSMOOR, ILLINOIS HELD ON FEBRUARY 19, 2026 VILLAGE HALL February 19, 2026 6:15 PM DRAFT ALSO PRESENT: Bridget Wachtel, Village Manager Jonathan Bogue, Asst Village Manager Joe Miller, Village Attorney ADJOURNMENT OF MEETING Mayor Nelson called for a motion to adjourn the meeting. Trustee Mitros so moved, seconded by Trustee Daggett. All were in favor, none opposed. AYES: Trustees Daggett, Dorsey, Lofton, Mitros, Mustafa, and Rodgers ABSENT: None ABSTAIN: None NAYS: None The Regular Meeting was adjourned at approximately 8:33 p.m. Respectfully Submitted, Cecil E. Porter Village Clerk Page 2 of 2 Page 15 of 76 Page 16 of 76 Page 17 of 76 Page 18 of 76 Page 19 of 76 Page 20 of 76 Page 21 of 76 Page 22 of 76 Page 23 of 76 Page 24 of 76 Page 25 of 76 Page 26 of 76 Page 27 of 76 Page 28 of 76 Page 29 of 76 Page 30 of 76 Page 31 of 76 Page 32 of 76 Page 33 of 76 Page 34 of 76 Page 35 of 76 Page 36 of 76 Page 37 of 76 Page 38 of 76 Page 39 of 76 Page 40 of 76 Page 41 of 76 Page 42 of 76 Page 43 of 76 MEMORANDUM TO: Bridget A. Wachtel, Village Manager CC: FROM: John S. Brunke, Public Works Director DATE: March 9, 2026 RE: Consideration of a Resolution of the Village of Flossmoor, Cook County, Illinois, for Construction on State Highway (2026-2027) This Resolution is a housekeeping item which must be passed bi-annually by the Village Board. When work is permitted in the IDOT State right-of-way, a surety bond is typically required for the permit. For municipalities, this resolution is acceptable in-lieu of a surety bond. This resolution is good for the calendar years of 2026 and 2027. When the Public Works Department performs a utility repair in the State right-of-way, we obtain a permit for the work from IDOT. This resolution allows us to streamline the permit process. The Village Attorney has reviewed this resolution. I request that the Resolution be presented for consideration and passage at the next Village Board meeting. Strategic Initiative (s) Addressed 2. Infrastructure & Housing Page 44 of 76  RESOLUTION NO. A RESOLUTION OF THE VILLAGE OF FLOSSMOOR, COOK COUNTY, ILLINOIS, FOR CONSTRUCTION ON STATE HIGHWAY (2026-2027) WHEREAS, the Village of Flossmoor, hereinafter referred to as “Flossmoor”, located in the County of Cook, State of Illinois, desires to undertake, in the years 2026 and 2027, the location, construction, operation and maintenance of driveways and street returns, watermain, sanitary and storm sewers, street light, traffic signals, sidewalk, landscaping, etc., on State highways, within Flossmoor, which by law and/or agreement come under the jurisdiction and control of the Department of Transportation of the State of Illinois hereinafter referred to as Department, and, WHEREAS, an individual working permit must be obtained from the Department prior to any of the aforesaid installations being constructed either by Flossmoor or by a private person or firm under contract and supervision of Flossmoor. NOW, THEREFORE, be it resolved by the Mayor and Board of Trustees of the Village of Flossmoor, Cook County, Illinois as follows FIRST: That Flossmoor hereby pledges its good faith and guarantees that all work shall be performed in accordance with conditions of the permit to be granted by the Department, and to hold State of Illinois harmless during the prosecution of such work, and assume all liability for damages to person or property due to accidents or otherwise by reason of the work which it be performed under the provision of said permit. SECOND: That all authorized officials of Flossmoor are hereby instructed and authorized to sign said working permit on behalf of Flossmoor. Passed this _____ day of ___________, 2026. AYES: _________________________________________ NOES: ________________________________________ ABSENT: ______________________________________ ABSTAINED: ___________________________________ PASSED: _______________________________________ APPROVED: ____________________________________ PUBLISHED: ____________________________________ Page 45 of 76  APPROVED: _____________________________ Mayor ATTEST: _____________________________ Village Clerk Page 46 of 76 MEMORANDUM TO: Mayor Nelson and Board of Trustees CC: FROM: Bridget A. Wachtel, Village Manager DATE: March 9, 2026 RE: Consideration of an Ordinance of the Village of Flossmoor, Cook County, Illinois, Approving a Second Escrow Agreement By and Among the Village of Flossmoor, the Vollmer Group LLC and the Flossmoor Office Center Condominium Association By way of background, in December of 2023, the Mayor and Board of Trustees authorized Village staff to petition Cook County for certificates to acquire 11 of the office condominiums at 1835 Dixie pursuant to the County’s “no-cash-bid” process on the condition that the Village would convey these parcels to the Flossmoor Office Center Condominium Association (the “FOCCA”) for redevelopment. Unfortunately, the Village’s petition to the County was never approved and instead five of the eleven parcels were acquired by the Cook County Land Bank. The Land Bank is prepared to convey these parcels to the Village, and the Village is prepared to take title to these parcels on the condition that the Village convey them for redevelopment and are reimbursed for all costs the Village shall incur to obtain these five parcels from the Land Bank. In the meantime, the FOCCA has formed an Illinois limited liability company, the Vollmer Group, LLC to stand in its place to purchase these five parcels and undertake the redevelopment. A Second Escrow Agreement, in the form presented to this meeting, has been drafted for your approval requiring the Vollmer Group LLC (successor to FOCCA) to escrow the amount required to reimburse the Village for all costs (including legal fees and title costs) to acquire the parcels from the Land Bank and then convey these parcels to the Vollmer Group, LLC. The Village Staff recommends the adoption of this Second Escrow Agreement in order to permit these five parcels to be redeveloped and placed back on the tax rolls. Strategic Initiative (s) Addressed 3.3. Target development of vacant commercial properties Page 47 of 76  Ordinance No. 2026 ___________ AN ORDINANCE OF THE VILLAGE OF FLOSSMOOR, COOK COUNTY, ILLINOIS, APPROVING A SECOND ESCROW AGREEMENT BY AND AMONG THE VILLAGE OF FLOSSMOOR, THE VOLLMER GROUP LLC AND THE FLOSSMOOR OFFICE CENTER CONDOMINIUM ASSOCIATION WHEREAS, the Village of Flossmoor, Cook County, Illinois (the “Village”) is a duly organized and validly existing non-home-rule municipality created in accordance with the Constitution of the State of Illinois of 1970 and the laws of the State; and, WHEREAS, the Village had authorized the submittal of a petition to Cook County to acquire certain tax delinquent parcels of property under Cook County’s “no-cash-bid” program and thereafter convey these same parcels to the Flossmoor Office Center Condominium Association (“FOCCA”) for redevelopment but only upon reimbursement to the Village for all expenses incurred; and WHEREAS, in consideration of the foregoing understanding, the Village Manager entered into an Escrow Agreement with FOCCA on December 12, 2023, requiring FOCCA to deposit $20,000 into escrow held by the Village to cover all costs to be incurred by the Village in connection with its acquisition of the tax delinquent parcels through Cook County’s “no-cash-bid” program; and WHEREAS, the Vollmer Group, LLC is a limited liability company of the State of Illinois (the “Vollmer Group”) and has advised the Village that it desires to succeed FOCCA in acquiring the “Land Bank Parcels”, as hereinafter defined, from the Village; and WHEREAS, the County did not act on the Village’s petition but instead conveyed the rights to acquire the following parcels to the Cook County Land Bank Authority: Parcel Number Address City Sq. Ft. 32-07-401-030-1008 1835 Dixie HWY Flossmoor 2,124 32-07-401-030-1010 1835 Dixie HWY Flossmoor 637 32-07-401-030-1014 1835 Dixie HWY Flossmoor 1,866 32-07-401-030-1015 1835 Dixie HWY Flossmoor 2,160 32-07-401-030-1016 1835 Dixie HWY Flossmoor 1,300 1 Page 48 of 76  WHEREAS, FOCCA is prepared to withdraw and repeal all prior agreements with the Village to acquire the parcels and permit the Vollmer Group to enter into this Second Escrow Agreement with the Village in the form attached hereto, to acquire the Land Bank Parcels and provide for reimbursement of all costs to be incurred by the Village at a cost not to exceed $59,600 in connection with its acquisition of the Land Bank Parcels from the Cook County Land Bank Authority. NOW, THEREFORE, BE IT ORDAINED by the Mayor and Board of Trustees of the Village of Flossmoor, Cook County, Illinois, as follows: Section 1: That the Second Escrow Agreement by and among the Village of Flossmoor, Cook County, Vollmer Group, LLC and the Flossmoor Office Center Condominium Association, in the form attached hereto and made a part hereof, is hereby approved and the Mayor and Village Clerk are hereby authorized to execute said Second Escrow Agreement and the Village Manager, and the Village Attorney are hereby authorized to undertake all necessary action to implement its terms. Section 2: This Ordinance shall be in full force and effect upon its passage, approval, and publication in pamphlet form as provided by law. Passed by the Mayor and Board of Trustees of the Village of Flossmoor, Cook County, Illinois, this _____ day of ____________, 2026. AYES: NAYS: ABSENT: ABSTAINED: PASSED: APPROVED: PUBLISHED: APPROVED: ___________________________________ Mayor Attest: _____________________________________ Village Clerk 2 Page 49 of 76  SECOND ESCROW AGREEMENT BY AND BETWEEN THE VILLAGE OF FLOSSMOOR, COOK COUNTY, ILLINOIS AND VOLLMER GROUP, LLC REPEALING THE ESCROW AGREEMENT WITH THE FLOSSMOOR OFFICE CENTER CONDOMINIUM ASSOCIATION This Second Escrow Agreement (the “Amendment”) by and among Vollmer Group LLC, Flossmoor Office Center Condominium Associations and the Village of Flossmoor is dated this ______ day of ______________, 2026. PREAMBLES WHEREAS, the Village of Flossmoor, Cook County, Illinois (the “Village”), is a duly organized and validly existing non-home rule municipality created in accordance with the Constitution of the State of Illinois of 1970 and the laws of the State; and, WHEREAS, the Vollmer Group, LLC is a limited liability company of the State of Illinois (the “Vollmer Group”) and has advised the Village that it desires to succeed to Flossmoor Office Center Condominium Association, an Illinois not for profit condominium association (“FOCCA”) in acquiring the “Land Bank Parcels”, as hereinafter defined, from the Village; and WHEREAS, FOCCA is prepared to withdraw and repeal all prior agreements with the Village, as hereinafter outlined, and permit the Vollmer Group to enter into this Second Escrow Agreement with the Village to acquire the Land Bank Parcels; and WHEREAS, by way of background, the Village identified certain parcels of property within the Village which are prime for commercial redevelopment however these parcels have unpaid real estate taxes which have been delinquent for over three years; and WHEREAS, due to the delinquent taxes, Cook County listed these parcels as available under the County as a “no-cash bid” program for municipalities to acquire for purposes of redevelopment; and WHEREAS, the Village was approached by FOCCA with a request that the Village apply to Cook County to acquire certain tax delinquent parcels as hereinafter itemized (the “Tax Delinquent Parcels”) on the condition that FOCCA would reimburse the Village for all costs it would incur in connection with such acquisition; and 1 Page 50 of 76  WHEREAS, the Village and FOCCA entered into an Escrow Agreement on December 12, 2023 (the “Original Agreement”) requiring FOCCA to escrow $20,000 for payment of all costs to be incurred by the Village in connection with its acquisition of the Tax Delinquent Parcels and, upon acquisition, convey these Tax Delinquent Parcels to FOCCA for redevelopment; and WHEREAS, the Village proceeded to petition Cook County for certificates to acquire eleven ( 11 ) Tax Delinquent Parcels, however, Cook County did not act on the Village’s petition for the Tax Delinquent Parcels and instead conveyed the rights to five of the Tax Delinquent Parcels to the Cook County Land Bank Authority (the “Land Bank”) which obtained Tax Deeds and holds title to the parcels (the “Land Bank Parcels”) identified as follows: Parcel Number Address City Sq. Ft. 32-07-401-030-1008 1835 Dixie HWY Flossmoor 2,124 32-07-401-030-1010 1835 Dixie HWY Flossmoor 637 32-07-401-030-1014 1835 Dixie HWY Flossmoor 1,866 32-07-401-030-1015 1835 Dixie HWY Flossmoor 2,160 32-07-401-030-1016 1835 Dixie HWY Flossmoor 1,300 8,087 WHEREAS, FOCCA has advised the Village that it is unable to proceed with the acquisition of the Land Bank Parcels and is prepared to terminate its interest and rights under the Escrow Agreement upon return of its deposit, less costs incurred by the Village as of the date of this Second Escrow Agreement; and WHEREAS, the Vollmer Group is prepared to proceed with the acquisition of said Land Bank Parcels and enter into this Second Escrow Agreement all as hereinafter provided. NOW THEREFORE, in consideration of the mutual promises and agreements as set forth in this Amendment, the Village and the Vollmer Group agree as follows: Section 1: The foregoing Preambles are hereby incorporated into this Second Escrow Agreement as it fully restated herein. 2 Page 51 of 76  Section 2: The Vollmer Group hereby directs the Village to proceed with the acquisition of the five (5) Land Bank Parcels and agrees to pay the purchase price of $50,000 established by the Land Bank plus all cots for title insurance, closing costs and legal fees (“Total Acquisition Costs”), as hereinafter provided. Section 3: Pursuant to the Escrow Agreement, FOCCA deposited $20,000 into an escrow paid by the Village for legal fees incurred to prepare the petitions under the “no-cash bid” program of Cook County which petitions were never heard, thereby leaving a balance of $10,690.75 which the Village will return to FOCCA within 10 days of the execution of this Second Escrow Agreement. Section 4. The Vollmer Group hereby agrees to deposit into the escrow account held by the Village pursuant to the Original Agreement the amount of $59,600 calculated as follows: $50,000 Purchase Price 4,600 Closing Costs as Estimated by the Land Bank 5,000 Estimated Legal Fees $59,600 Section 5. The Vollmer Group agrees to deposit $59,600 with the Village within five (5) business days of the execution of this Amendment. Section 6. The Village shall notify the Vollmer Group within five (5) business days of receipt of a deed to the Village for the Land Bank Parcels and thereafter convey the Land Bank Parcels to the Vollmer Group; the Vollmer Group agrees to accept title from the Village for the Land Bank Parcels by Quit Claim Deed and assume all responsibility to record said Deeds and pay all costs therefor. Section 7. Upon delivery of the Quit Claim Deed for the Land Bank Parcels to the Vollmer Group, any funds not required for legal and closing cost fees shall be returned to the Vollmer Group. Section 8. In the event the acquisition of the Land Bank Parcels by the Village does not occur, for any reason, all funds held by the Village for said acquisition, less any attorney fees incurred by the Village, shall be returned to the Vollmer Group. 3 Page 52 of 76  Section 9. The Vollmer Group and FOCCA shall indemnify and hold harmless the Village and all of its elected and appointed officials, employees, agents, and attorneys from any and all claims that may be asserted at any time against any of such parties in connection with the Escrow Agreement and this Second Escrow Agreement concerning the acquisition of the Land Bank Parcels and conveyance to the Vollmer Group, which indemnification and hold harmless shall survive the term of this Second Escrow Agreement. Section 10. This Second Escrow Agreement shall be in full force and effect upon the execution by the parties and, but for the covenants in Section 9, terminate upon conveyance of the Land Bank Parcels to the Vollmer Group and payment to the Village of all costs and expenses it has incurred in connection with the acquisition from the Land Bank and the conveyance to the Vollmer Group of the Land Bank Parcels. Section 11. Execution of this Second Escrow Agreement by the parties shall constitute the sole agreement of the parties and in the event any of the terms and provisions of this Second Escrow Agreement conflict with the Escrow Agreement, the terms and provisions of this Second Escrow Agreement shall prevail; all prior agreements between the parties, whether written or oral, are merged into this Second Escrow Agreement and shall be of no force and effect. Section 12. This Second Escrow Agreement may be executed in two or more counterparts. IN WITNESS WHEREOF, the Parties hereto have executed this Second Escrow Agreement as of the dates set forth below their respective signatures, to be effective as of the Effective Date. VILLAGE OF FLOSSMOOR, Cook County, Illinois an Illinois municipal corporation By: Michelle I. Nelson, Mayor Attest: ______________________________ Cecil E. Porter, Village Clerk 4 Page 53 of 76 THE VOLLMER GROUP, LLC, an Illinois limited liability company, By: Its Manager THE FLOSSMOOR OFFICE CENTER CONDOMINIUM ASSOCIATION, an Illinois not for profit condominium association, By:_________________________________ Its Manager 5 Page 54 of 76 MEMORANDUM TO: Mayor Nelson and Board of Trustees CC: FROM: Bridget A. Wachtel, Village Manager DATE: March 9, 2026 RE: Consideration of a Liquor License Request for a Class AB-VGP Liquor License (Beyond Borders Café) Chris and Jen Zarozny, owners of Beyond Borders Cafe, have been successfully operating this local coffee shop since July 2025. The cafe serves as a coffee shop throughout the day and evening and also offers wine and beer to consume on-premise or to purchase retail. The retail sales are ancillary to their business model of creating a community environment centered around coffee, beer and wine, music and conversation. Now that they have been in operation for awhile, they would like to expand their beer and wine offerings to include mixed drinks. Their current local liquor licenses include a Class A for consumption on-premise and a Class BWP-VGP to permit the package sale of beer and wine (video gaming prohibited). As a reminder, the Village does not have liquor licenses on the shelf. Each new request needs to be considered by the Village Board. Further, according to the most recently approved ordinance amending this section of the Municipal Code, “the Mayor and Board of Trustees shall authorize the issuance of all initial licenses for each class. The total number of licenses for each class shall be equal to the number of licenses for each class that has been issued by the Liquor Commissioner and remains in good standing.” Therefore, so long as the liquor classification exists, the Board can hear the request and approve it, if you so choose, all at the same meeting by a simple motion. However, if a new class needs to be created, the code will need to be amended at a subsequent meeting. The Zarozny's are requesting a Class A-1 license; however, their business model has not included self-service pouring stations. The Class A-1 license does not restrict video gaming. Staff and the Village Attorney suggest the following classification based on their operations: Class AB-VGP. This class allows them to continue to serve on site, sell retail and restricts video gaming. This class would also reduce their licenses from two to one. Class AB-VGP - Restaurant, Package, Video Gaming Prohibited. Class AB-VGP shall authorize the sale at retail of alcoholic liquor for consumption on the premises described in the license; authorize the sale at retail of alcoholic liquor in the original packages only on the premises where sold for consumption off premises; and prohibit any video gaming terminal as defined in the Video Gaming Act of Illinois, 230 ILCS 40/1 et seq., to be located or operated on the licensed premises. Staff consulted with the Zaroznys, and they understand this license classification better meets their needs as described. If the Board agrees, approval is determined by a simple motion. The Zaroznys plan to obtain this license right away and then renew it May 1. They would not renew their Class A and Class BWP-VGP licenses. Strategic Initiative (s) Addressed 3.7. Engage in a program to attract businesses that best fit community needs. Page 55 of 76 From: Chris Zarozny To: Bridget Wachtel Subject: Beyond Borders Liquor license proposal Date: Monday, February 2, 2026 2:46:43 PM Proposal to Upgrade Beyond Borders Cafe’s Liquor License to Full Liquor License with On-Premises and Off- Premises Sales Executive Summary Beyond Borders Cafe, located at 1036 Sterling Ave, Flossmoor, IL 60422, currently holds a license permitting beer and wine sales (likely Class BWP-VGP or similar). This proposal seeks to upgrade to a full liquor license allowing sales of all alcoholic liquors (beer, wine, and spirits) for on- premises consumption while retaining and expanding the ability to sell packaged liquor for off-premises consumption and carryout. Under Flossmoor's liquor ordinances (Village Code Chapter 103), standard Class A (Restaurant) licenses authorize on-premises sales only, with no off-premises sales. However, a Class A-1 license (or equivalent combined designation) authorizes both on-premises consumption and limited off-premises sales in original packages, provided the packaged sales area does not exceed 25% of the floor area dedicated to alcohol sales. This upgrade would enable full bar service (including spirits-based cocktails) alongside continued carryout of packaged beer, wine, and spirits, aligning with customer demand for convenience and supporting revenue diversification. Background and Current Situation Beyond Borders Cafe operates as a community-focused cafe and wine bar with extended hours and global-inspired offerings. Current licensing limits sales to beer and wine, primarily on- Page 56 of 76 premises, without spirits or broad carryout options for full liquor. Flossmoor's ordinances classify licenses as follows (per Village Code §103-1-5): Class A (Restaurant): Full alcoholic liquors for on-premises consumption only; no off- premises sales. Class A-1: Authorizes on-premises sales (including from machine-operated pouring systems) and retail sales of alcoholic liquor in original packages for off-premises consumption, with the packaged area limited to ≤25% of alcohol sales floor space. Class B (Package): Off-premises only, in original packages. Other classes (e.g., Class C for clubs) are not applicable. The ILCC Retailer's License can be designated for on-premises, off-premises, or combined on/off-premises sales, but local approval governs specifics. Many Illinois municipalities allow restaurants with combined licenses to offer carryout of unopened, packaged liquor (no open containers), as confirmed in ILCC guidance. The proposed upgrade targets a Class A-1 (or combined Class A equivalent) to retain off- premises carryout capabilities while adding full liquor service. Benefits of Upgrading (with On/Off-Premises) Revenue Growth: Full spirits enable higher-margin cocktails (20-30% beverage revenue increase). Packaged carryout adds incremental sales (e.g., bottles for home use, events), potentially 10-15% additional uplift. Customer Convenience and Appeal: Retain carryout for wine/beer/spirits appeals to take- home customers; full bar enhances on-site experience for evening crowds and events. Competitive Positioning: Differentiates from limited-license venues in Flossmoor; supports "world of coffee and community" with global cocktails and packaged options. Event and Flexibility: Enables private events with full service and carryout for guests. Risk Mitigation: Compliance with area restrictions and no open-container carryout maintains focus as a restaurant. Market Analysis Page 57 of 76 Flossmoor's demographics support demand for versatile beverage options, including carryout during evenings/weekends. Industry trends favor combined on/off-premises for restaurants. Financial Projections Projections Combined model of wine/beer/spirits could yield 30-40% beverage revenue growth (on-site + carryout). Conlusion This upgrade to a full liquor license with combined on-premises and off-premises sales positions Beyond Borders Cafe for maximum flexibility and growth. Retaining carryout maintains existing revenue streams while adding spirits expands appeal. CAUTION: This email originated from outside the Village of Flossmoor. Do not click links or open attachments unless you recognize the sender and know the content is safe. Page 58 of 76 Village of Flossmoor PRELIMINARY BUDGET FY 2027 Executive Summary Page 59 of 76 FY 27 Preliminary Budget Executive Summary Page 2 FY 27 Preliminary Budget The Village uses fund accounting, the accepted accounting structure for governments. A fund functions as a separate fiscal entity with its own assets, liabilities and revenues and expenses. Different funds are used to segregate transactions related to certain functions or activities. This executive summary is intended to provide an overview of the General Fund and the Water and Sewer Fund, two of the largest operating funds in the Village budget. A complete copy of the FY 27 Preliminary Budget can be found on the Village website, www.flossmoor.org. Water Fund Summary For the last several years, the presentation of the Preliminary Budget has started with an understanding of the Water and Sewer Fund’s financial health in order to understand the additional pressures being placed on the General Fund. We have previously discussed that the fund cannot be self-sustaining without an accumulated fund balance to support capital improvements, which for several years has not been able to do. The low purchased to bill ratio compounded by the costs of repairing water main breaks and aging infrastructure had become a financial strain. In addition to serviceability and fire flow, the amount of leaks and breaks had contributed to a peak water loss of more than one in three gallons purchased. Following the water main replacement from the 2013 and 2014 bonds and repairs to the Vollmer Reservoir, the Village experienced a period of time with less water purchased, an improved purchased to bill ratio and less repairs. Poor performing water main is one concern, while poor performing meters is another concern. An additional effort to improve the water main system performance was the replacement of large meters throughout the community in 2014 and 2015. Technology has advanced, and we replaced large meters with ones that are better able to capture low-flow reads, thereby contributing to improving our billing and subsequently increasing our revenue. Following that initial work, the Village’s purchased to bill ratio climbed to 83% (up from 59%) but unfortunately decreased with a 79% purchase to bill ratio in fiscal year 2025. In fact, many of those large meters were rebuilt again this fiscal year as part of our maintenance program. For several years, the Village has had a priority to replace the residential (small) meters with the newer technology. Considering high water rates and the community-wide impact of accounting for unbilled water, the replacement of water meters to improve the equitable accounting of water usage was the next logical step. Based on the performance of the large meter project, we were confident that replacing approximately 2,600 small meters would have a positive impact on the purchased to bill ratio. The project was substantially completed by September of 2024. The immediate impact was an increased accounting for water used with increased bills; naturally, customers responded with increased conservation measures. The successful passage of the 2022 water supply contract with Homewood for Hammond/Chicago Heights water will bring certainty for the Villages of Homewood and Flossmoor for the next 25 years with respect to the supply rate cost increases as that contract ties the increase to CPI and caps the increase to 3%. Flossmoor is using existing infrastructure through Homewood to receive the water supply but will need to make improvements at the pumping stations, reservoir and booster stations as needed. The preliminary cost of these improvements is about $1.68M, a cost which should decrease as terms favorable to Flossmoor Page 60 of 76 FY 27 Preliminary Budget Executive Summary Page 3 were negotiated in the Homewood/Flossmoor agreement. The first phase of the project, SCADA system improvements, began with design engineering in Fiscal Year 2025. FY27 Budget FY 26 Projections FY 26 Budget Operating Revenue $4,536,650 $4,668,625 $4,846,912 Operating Expenditures $4,770.918 $4,098,286 $4,319,909 Net Operating Water & Sewer $ (234,268) $ 570,339 $ 527,003 FY27 Budget FY 26 Projections FY 26 Budget Total Revenue $4,536,650 $4,668,625 $4,846,912 Total Expenditures $5,641,948 $4,534,893 $5,460,470 Net Total Water & Sewer $(1,105,298) $ 133,732 $ (613,558) The Village’s Water and Sewer Fund is projected to end FY26 with a surplus in its operating and total fund position, in part due to increased water revenue, a relatively flat cost in water supply needed, and less maintenance performed this year. With improved financials, the Village has been able to shift water capital costs back to the fund, notably the costs associated with the water supply improvements, totaling approximately $680,000 between FY 26 and FY 27. The FY 26 budget also included the capital expense of the relocation of a sanitary sewer in the Central Business District. The Preliminary FY 27 budget reflects a small operating fund budgeted deficit, before rates are re-calculated. The total fund position includes the SCADA replacement project and the engineering associated with lead line service replacement. For FY 26, water and sewer sales were overbudgeted based on anticipated new meter revenue. Specifically, the Village is anticipating receiving approximately $208,672 less in revenue than budgeted by fiscal year end. With increased water bills immediately after the new meters were installed, customers responded with conservation measures, and the Village did not realize the full revenue budgeted. That said, sales revenue prior to the project (audited FY 24 sales) compared to a projected full fiscal year post project (projected FY 26), anticipates an increase of $629,122 in revenue. Even a partial fiscal year post-project (audited FY 25) realized an increase of $413,617 in sales according to audited figures. A year and a half post audit is still early to assess trends, but staff will continue to monitor the activity closely. Costs anticipated to be greater than budget include the water supply, or purchase, costs from Homewood trending $73,134 greater than budget this year due to increased pumpage and increased supply costs beginning January 2026. The increased pumpage is monitored for leaks. The contract with Hammond/Chicago Heights had a starting supply rate of $5.01 on March 1, 2025 and rose to $5.15 on March 1, 2026, which is an increase of 2.7%. Water main commodities and overtime costs associated with repairs are projected to be approximately $38,000 under budget. Another savings impacting the operating budget for the next few years include hydrant sandblasting and painting; the work was completed throughout the Village three years ago and will not resume for another five to seven years, which is a short-term savings of $40,000 per year. Page 61 of 76 FY 27 Preliminary Budget Executive Summary Page 4 Capital outlay in the Water and Sewer Fund was not fully expended this year, with projects carrying into FY27. The relocation of a sanitary sewer main in the downtown was completed as part of the Central Business District Improvements Project; the project was budgeted at $460,000 and was completed for approximately $430,000. The water system SCADA project is budgeted at $680,000, but a delay in the selection of the program software will push this cost into FY27. Although not a capital outlay project, the annual sewer maintenance televising and repair work planned for FY26 at a cost of $270,000 is deferred and re-budgeted to FY27 due to cash flow; while the downtown area was televised and cleaned this summer, the next area to be completed will be parts of Old Flossmoor and The Park. The outlook for this fund is encouraging with increased revenues and the ability to allocate fund balance toward capital and non-operating expenses. The accounting for personnel that support our water and sewer fund will be considered as future expenses in the Water and Sewer Fund as it continues to perform well; relieving the General Fund from the burden of supporting the Water and Sewer Fund is one key component to addressing our financial health. General Fund Summary At the time of the FY 26 budget preparation and inclusive of budget amendments, we budgeted the use of $1,454,159 in fund balance to close an operating revenue gap with an additional $1,739,898 toward capital. This single year snapshot analysis shows that we budgeted to use more in fund balance than we would have saved this year, mostly attributable to the Dartmouth Road Bridge and Streambank Stabilization project at a budgeted cost of $690,800 and the Village’s share of the CBD Roadway, Pedestrian and Streetscape Improvements at a cost of $783,000; even though both of these projects have grant revenues to offset some or the majority of the expenses, the Village’s budgeted out of pocket expense that remains is significant. In addition, other capital improvements such as the Flossmoor Road Viaduct Improvements and the acquisition of 1648 Western Avenue as part of the federal flood prone property program are offset more substantially by grant revenues. Other capital expenditures include municipal complex facility improvements, document scanning and retention, and the demolition of 3648 W 198th Street. Capital one-time non-operating projects are always planned with adequate monies available. FY27 Budget FY 26 Projections FY 26 Budget Operating Revenue $14,814,594 $12,915,941 $13,724,534 Operating Expenditures $16,168,007 $14,338,492 $15,169,267 Net Operating General Fund $ (1,353,413) $ (1,422,551) $ (1,444,733) The Village is projecting to end FY26 utilizing close to the budgeted fund balance to support operations, due in part to large variances in significant revenues, deferred capital and operating expenses, and vacant positions. The FY27 preliminary budget has a similar budgeted deficit that would be filled with the allocation of fund balance. Page 62 of 76 FY 27 Preliminary Budget Executive Summary Page 5 FY27 Budget FY 26 Projections FY 26 Budget Total Revenue $16,006,405 $14,991,350 $17,068,597 Total Expenditures $18,989,857 $16,534,239 $20,155,984 Net Total General Fund $ (2,983,452) $ (1,542,889) $(3,087,387) The Village does not anticipate spending all of the money allocated in FY26 for capital and non- operating projects. Many of these deferred projects are re-budgeted in FY27. Note: The preparation and analysis of the FY27 Preliminary Budget have been complicated by a delay in Cook County tax receipts from the second installment of the 2024 tax levy. This unprecedented issue has resulted in an uncertainty that has impacted the Village’s cash flow, operations, capital projects and equipment replacement schedule. These numbers were prepared, adjusted and will need to be considered again. No further changes were made after February 28, 2026. Even in the presentation of this report, there is a level of uncertainty over the next few months which will impact the final expenditures of FY26 and the ability to resume business as usual at the start of FY27. The long-term impact of this situation is still unknown. Cook County Property Taxes Continuing to diversify the Village’s revenue sources could not be a more appropriately timed discussion considering the situation with Cook County and its delay in remitting property tax receipts to its downstream agencies. Cook County did not issue bills to taxpayers until November 14, 2025, due December 15, 2025. Receipts did not begin to be sent to downstream agencies until December 29, 2025. Monies have trickled in, and to date, Cook County has remitted roughly $3.42 million ($3.25 million associated with the second installment bills due December 15) of property tax revenue in Fiscal Year 2026. For reference, the second installment should generate approximately $3.5 million for the Village of Flossmoor. The delay has been in large part due in large part to Cook County undergoing a financial system’s migration to Tyler Technologies for the past ten years. We have learned that they are migrating from very old mainframe systems, and the conversion has not gone well. Systems aren’t talking to each other, various staff have retired, and fixes are slow. This situation has become grave for those communities heavily dependent upon property tax revenue like Flossmoor. Villages like Flossmoor have slowed down, delayed paying bills, communicated with vendors about the same, disinvested investments and dipped into reserves to boost available cash. We have lost interest income in a good interest income market, not only from the investments not re-invested but from the monies sitting in county accounts and not local accounts. In addition to the challenges of cash flow to support daily operations, more long-term Village operations are now impacted. Our immediate recourse was to slow down spending and then halt capital equipment expenditures and capital project work. This delay is at the point at which the Village’s Capital Equipment Schedule and the Finance and Facilities Plan (capital infrastructure) are impacted. Page 63 of 76 FY 27 Preliminary Budget Executive Summary Page 6 The preparation of the FY 27 budget began in late December. Projected Property Tax receipts reflect 70% of the levy. Current actuals reflect that we are finally closer to 90% of the levy 2024 amount. Historically, Flossmoor receives approximately 96-97% of the levy amount. The impact on cash flow is anticipated to continue into the spring with an already State- approved delay in the 2025 first installment due spring 2026 with the State legislature approving an extension to April to permit County to get the next bills out. Bills were sent February 27, 2026, due April 1, 2026. Unofficially, the Village learned that tax monies from the 2025 first installment will be remitted as early as March 16, 2026, but past performance by the Cook County Treasurer’s Office does not instill confidence. Even to meet the 70% target in projected revenue before fiscal year end, the Village would need to collect an additional $2.4M during the months of March and April from the 2025 first installment. There is a high probability that a portion of these tax receipts will not be received until after May 1, 2026, thereby detrimentally impacting our FY26 financial statements. Quite simply, it’s a guess at this point. Expenditures The analysis of expenditures can be viewed a couple of different ways. First, how do we project to perform for the year? Second, how does this year’s budget compare to next year’s budget? For our current Fiscal Year, FY26, the Village is projected to spend approximately $830,775 less than budget in operating expenses. The FY26 budget inclusive of budget amendments would have had a $1,444,733 use of fund balance; projections show the use of $1,442,551. The chart below compares just the budgeted expenditures to projected. FY 26 Operating Expenditures: Budget vs. Projections FY 26 G.F. Operating Budget $15,169,267 FY 26 G.F. Operating Projections $14,338,492 $ 830,775 The Village anticipates spending approximately $830,775 less than budgeted this fiscal year on its operations. It is highly unusual to have such significant savings in expense, only to project such a significant use of fund balance to close the revenue / expenditure gap. FY26 projections compared to FY26 budget: Significant Expenses under budget (FY26 proj’d vs. FY26 budget): • Given the shortfall in property tax receipts, the Village did not make the fourth quarter transfer of $212,221 to the Capital Equipment fund for the year. These quarterly payments make up the General Fund’s annual contribution toward the ten-year replacement schedule. Page 64 of 76 FY 27 Preliminary Budget Executive Summary Page 7 • Full-time personnel turnover and vacancies across all departments had an impact on budget savings this year for a combined salary savings of approximately $131,512. • Across departments part-time personnel vacancies also contribute to projected savings. These are cases where positions were unfilled or budgeted hours were not expended. In total, there is a projected savings of approximately $34,347. • With fluctuations in actual staffing compared to budget, benefit lines are impacted. The budget assumes full staffing while projections reflect the actual staff census. The most significant benefit projected to be under budget is the Village’s EAP and wellness program. The Village switched to a new wellness program in 2025, and enrollment decreased with the transition. The financial impact is a projected $14,000 savings. However, this program has been viewed favorably by the health insurance companies in our renewal process, and therefore, increased participation will be encouraged. This could therefore be a short-term savings. • Reported in the part-time personnel vacancies above is the Duty Shift Program pay which is projected to be under budget by $14,472 due to less paramedics available to work; this shortage is industry-wide and not unique to Flossmoor. Subsequently, Paramedic Incentive Pay is projected to be about $8,500 less than budget due to this staffing shortage. Further, the Fire Department internship program is estimated to end the year approximately $9,500 less than budgeted; this adjustment reflects a relatively new program. • As part of moving to an electronic document management system, the Village planned to set aside funds every year to scan paper files and make them OCR searchable. The Village budgeted $100,000 for FY26, and with the spending slow down caused by the delay in Cook County tax receipts, the Village expects to only spend $40,000 this year. • With the transition to the vehicle use fee, the budgeted $15,000 administrative costs of the vehicle sticker program will be saved. • Across police, fire and public works departments, $23,000 less is expected to be spent on uniforms before fiscal year end, the bulk of which ($17,000) is for the replacement of fire turnout gear which needs to be considered next year. These funds weren’t fully realized due to the delay in Cook County property tax receipts. • Fire Department hose and pager supplies are projected to be $15,000 less than budgeted in part due to the sale of fire engine 19 but also in part due to the delay in Cook County property tax receipts. • The Village’s 911 surcharge revenues remitted to and held by E-Com, our combined dispatch agency, pays for a majority of our dispatch services. However, for those costs that exceed our surcharge revenue, the Village allocates General Fund monies in an amount equivalent to a quarterly payment. For FY26, the Village anticipates spending approximately $28,000 less than budgeted out of the General Fund. • The Village had a small portion of the annual street maintenance program allocated to the General Fund, in the amount of $80,000. With the delay in property tax receipts, staff allocated the full amount of the annual program to MFT to relieve the General Fund. • As part of the police firearms range project, there is a building plumbing repair that needs to be completed. With the delay in this project, building repairs are projected to be $20,000 less at fiscal year-end with the monies reallocated to this repair in FY27. Page 65 of 76 FY 27 Preliminary Budget Executive Summary Page 8 Significant Operating Expenses over budget (FY26 proj’d vs FY 26 budget): • Several fringe benefits are projected to be more than budget as a reflection of actual staffing versus budgeted staffing. The most significant is the Village’s IMRF contribution, which is projected to be $51,000 more than budget, an increase which is compounded by a rate increase from 8.14% to 11.06% effective January 2026. FICA and Medicare are projected to be approximately $18,000 more than budget. Finally, with more employees moving over to the HSA health insurance, we are projecting an $8,400 increase in employer contributions toward “seed money.” • The Village engaged its actuary to analyze the impact of SB1937 on the Village’s police and fire pension plans. The cost of this additional study was an additional $10,000. This analysis is imperative to explain to state legislators the financial implications of increasing pension benefits, especially without a dedicated funding stream. • The annual BS&A cloud maintenance contract is a new expense moving forward, impacting the IT budget by $25,000. • Police overtime is expected to be $196,000 more than budget this year, $60,000 of which is reimbursed by traffic detail grants. The rest is attributable to extended shifts, coverage for injured officers or vacancies and special details that are reimbursed by outside parties. Overtime in police records is also higher than budgeted by $15,000 due to medical coverage. • Part-time records clerks' salaries are also more than budgeted as staffing has been needed to address FOIAs and support administrative adjudication. The impact is an additional $24,500 projected to be spent by fiscal year end. FY 26 Total Expenditures: Budget vs. Projections FY 26 G.F. Total Budget $20,155,984 FY 26 G.F. Total Projections $16,534,239 $ 3,621,745 Overall, inclusive of capital, the FY 26 total General Fund projections are less than budgeted by $3,621,745. In short, less capital was spent than planned with a short-term savings to the current fiscal year. Capital & Non-Operating Expenses • The Village was awarded a second Cook County Invest in Cook grant to help offset the expenses of the Phase II Engineering of the CBD Roadway, Pedestrian, and Streetscape Improvements Project. This project modernized and accentuated the Central Business District by adding parkway and crosswalk pavers, sidewalk replacement to remove tripping and other safety hazards, ADA access improvements, additional trees with tree planters, benches, bike racks, wayfinding and safety signage, and other decorative landscaping elements such as an increase in open green space and gateway features. More importantly, the existing roadway and pedestrian facilities that were in need of safety improvements such as re-configured intersection geometry, Page 66 of 76 FY 27 Preliminary Budget Executive Summary Page 9 improved vehicle and pedestrian sight lights, improved crosswalk configuration and crossing safety treatments, and evaluation of existing on-street parking locations were also completed. The Cook County grant partially offset the Phase II engineering costs of $149,814. The Village was able to secure an IDOT ITEP grant in the amount of $1,184,456 for the Phase 3 construction which was completed in the summer and fall of 2025. The project punch list and closeout will occur in the spring of 2026. The work was managed as an IDOT construction project, and the Village’s share of construction expenses will be billed in FY27. The Village engaged construction observation engineering at $177,755 which was expended in FY26. • Progress continued on the Flossmoor Road Viaduct Improvements. The project involves large scale storm sewer and stormwater storage improvement to address the severe roadway flooding of the Flossmoor Road Viaduct during heavy rainfall events. In addition to increasing stormwater conveyance, stormwater detention was added. The project has been paid for with grant funding, Rebuild Illinois Bond Funds, and the 2021 Streets and Stormwater Improvements Bond Fund. The project’s grant funding passes through the Village’s General Fund. This year, Phase 3 – which included the storm sewer installation on Lawrence Crescent from Maryland Avenue to the newly constructed basin – was constructed. FY26 projections include $2,322,995 (Phase 2 basin and Phase 3 final construction numbers) and $117,358 in construction observation services for Phase 2 (the basin) and Phase 3. The total bond funds used in FY26 are $940,353. • As part of the Fiscal Year 2026 Village Hall Municipal Complex Improvements, staff has been working on increased security in the Building Department and the Police Department’s women’s bathroom. Staff anticipates completing the Police Department’s women’s bathroom and some of the design services associated with the front desk security in the Building Department before fiscal year end. Due to delays in architectural services and then delays in Cook County property tax receipts, the majority of this project will be carried over to FY27. The projected budget is $350,000 less in FY 26 and $300,000 has been budgeted for FY27. • The Dartmouth Road Bridge Replacement and Streambank Stabilization Project moved forward in FY26 with some design engineering. In 2024, the Village was awarded a Section 319 Grant from the IEPA for the streambank stabilization portion of the project that has an estimated cost of $186,000 of the total $690,800 budget. The grant covers 60% of this portion of the project. The Village anticipates also utilizing a state set-aside grant from Senator Harris in the amount of $250,000 toward this project. Approximately only about $80,000 of the design engineering services were expended in FY 26. • Other one-time purchases or non-operating expenses also affect the total fund position. A contract with Retail Coach to provide economic development support was expended this year at a cost of $27,500. The Village is also contracting with Laserfiche to provide electronic document management services. Including scanning Village records, the Village is expecting to expend about $45,000 for this service this year. The Police Department received another Illinois Attorney General Retail Theft Grant to expand our camera network to retail corridors outside the downtown area, which we expect to expend about $20,000 in FY 26 and another $20,000 in FY27. The Village also received a ComEd Powering Communities grant in the amount of $10,000 which offset the purchase of 5 pedestrian crossing beacons at high pedestrian traffic areas around schools in the amount of $26,000. Finally, after the Village acquired 3648 W. 198th Page 67 of 76 FY 27 Preliminary Budget Executive Summary Page 10 Street through the municipal tax sale, the Village was able to demolish the dilapidated structure which has readied the property for development of a film studio. FY27 budget compared to FY26 budget: The Village’s FY27 General Fund operating expenditures are budgeted to be approximately $998,740 more than FY26 budgeted expenditures; however, with capital improvements, total expenditures are approximately $2.5 million more than budgeted last year, which is a function of more capital and non/operating expenses planned for next year. This single-year snapshot reflects an increase in the draw down of fund balance budgeted in FY27 for capital and non- operating expenses compared to the FY26 budget. FY 27 Budget vs. FY26 Budget Operating Total FY 27 G.F. Expenditures $ 16,168,007 $18,989,857 FY 26 G.F. Expenditures $ 15,169,267 $16,534,239 $ 998,740 $ 2,455,618 Significant Expenses under FY26 budget (FY27 vs. FY26): • The FY27 budgeted IRMA premium contribution is approximately $16,000 less than FY26 due to a large excess surplus credit available to the Village. • The Village does not plan to renew its contract with Retail Coach at this time. With the agreement with Southland Development Authority to market and develop Southwest Flossmoor, which is the Village’s primary focus for economic development, a contract with Retail Coach is not needed at this time. This saves the Village’s General Fund $27,500. • Fire Department uniforms are budgeted $30,000 less in FY27 compared to FY26 due to extending the replacement of turnout gear over the next few years. • Fire hose and pager supplies are budgeted $10,000 less than FY26 to reflect a more realistic history of spending. Significant Operating Expenses greater than FY27 budget (FY27 vs FY26): • Health insurance is budgeted $163,900 more in FY27 compared to FY26. This reflects a market trend of 11% compared to the general medical trend of 15%. This increase also reflects our current census. Other fringe benefits with an increased budget in FY27 include the Village’s IMRF contributions at a budgeted increase of $165,000 due to a 11.06% employer contribution and FICA and Medicare at a combined increase of $39,000 due to higher salaries and full staffing. • The annual contribution toward the Capital Equipment Fund, the majority of which is contributed by the General Fund, continues to rise with an increase of $157,665 from FY26 for a total contribution of $1,006,511 ($1.3 million total). This reflects increased costs and adjustments to the capital equipment schedule. Page 68 of 76 FY 27 Preliminary Budget Executive Summary Page 11 • The Village’s total shared Information Technology operating budget increased by a total of $45,000 comparing budget to budget. With our new IT vendor, the Village has been able to reduce the number of network devices and capital costs in the last few years. However, the industry is moving to more subscription-based services even for network equipment. This FY27 budget reflects an average of 3-5% anticipated increase. New this year is an allocation to the Water and Sewer Fund of $26,000. Other IT costs greater than budget include subscription services such as the Village’s annual financial software maintenance cost at an increased budget of $27,000. • Police overtime is budgeted at $96,937 more than last year’s budget reflecting actual spending in recent years and account for more details at the schools, traffic enforcement detail and special events. • The contracted Fire personnel is expected to increase by approximately $115,000, in part to provide a wage adjustment in FY26 and FY27 to remain competitive with other area contracts and to retain our staffing. • Fire Department tuition has increased by approximately $15,000 in comparison to FY26 reflecting our increased part-time staffing and the elimination of federally subsidized fire classes. • The budget for part-time records clerks reflects recent needs to fulfill an increasing number of FOIA requests and assist with the administrative adjudication hearings. This budget has increased by $16,282. • The Village is anticipating receiving approximately $135,000 annually from the southland casino revenue. The legislation requires that this revenue be expended on capital improvements, therefore the staff has allocated an additional $47,000 toward the sidewalk replacement fund for a total of $247,000 in FY27. • The building maintenance costs of Village facilities continues to rise and the FY27 budget includes an additional $20,000 for cleaning services and an additional $25,000 to accommodate a plumbing repair in the Police Department as part of the gun range project. Capital and Non-Operating: • Several projects described in FY26 will continue into F27: the Flossmoor Road Viaduct Project; the CBD Roadway, Pedestrian and Streetscape Project; the Dartmouth Bridge Replacement and Streambank Stabilization Project and improvements to the Municipal Complex. • The acquisition and demolition of 1648 Western Avenue to deed restrict for flood control is coming to fruition thanks to a FEMA and MWRD grant. This home is ill-placed next to Butterfield Creek in the floodplain and has undergone significant flooding over the years, causing multiple homeowners to sell the property. Thanks to the FEMA flood-prone home buy-out program, the Village will be able to purchase, demolish and file a deed restriction on this property so another home cannot be rebuilt. The two grants will offset the $500,000 expense. This project was paused in FY26 due to cash flow concerns with the delay in Cook County property tax receipts. Like most grants, the Village must front these monies and be reimbursed through the grant program. Fronting $500,000 during Page 69 of 76 FY 27 Preliminary Budget Executive Summary Page 12 a time of cash flow constraint is significant for our Village, and therefore, this project has been delayed, which MWRD (another Cook County jurisdiction) understood. This project has been re-budgeted for FY27 and hopefully, the Village has not lost another opportunity to complete this work. • Other non-operating costs include scanning Village files into our document management system ($50,000). Revenues An analysis similar to expenditures can be completed for revenues. The Village budgeted FY 26 General Fund operating revenues at $13,724,534 and yet, we are projecting them to be $12,915,941 at fiscal year-end. The total revenue position accounts for grants and one-time revenues. Operating Revenues Total Fund Revenues FY 26 G.F. Projections $12,915,941 $14,991,350 FY 26 G.F. Budget $13,724,534 $17,068,597 $ (808,593) $(2,077,247) Projected operating revenues are less than budgeted, mostly attributable to the delay in Cook County property tax receipts. In addition, a contributing difference between operating and total fund projected revenues is the receipt of various grants. The Village anticipates receiving $1,188,211 less in grants in FY26 than budgeted with several being carried over to FY 27. Significant Revenues projected over budget (FY26 proj’d vs. FY26 budget): • Sales tax and non-home rules sales tax is anticipated to be approximately $760,000 more than budget, most likely a result of the high inflationary market. This increase is also in part due to the legislative amendment to the Local Use Tax which shifts some of this revenue to sales tax. • State income tax is projected to be approximately $200,620 more than budget per the IML per capita trends. This is likely due to the inflationary market and increased wages. However, this third largest revenue source is once again threatened by the State of Illinois through a proposed reduction in the constitutionally-mandated sharing. Specifically, the proposed State budget proposed a reduction from 6.47% to 6.23%. • The southland communities are sharing in the Southland Casino located in East Hazel Crest/Homewood. The Village is projecting to receive $51,000 more this this fiscal year for a total of $135,000. • Building permits are trending $20,000 more than budget for fiscal year end. • The taser grant through ILEAS was received after May 1 and therefore, will be reflected in this year’s financials with $15,000 in revenue to offset year one of the taser agreement in FY25. Page 70 of 76 FY 27 Preliminary Budget Executive Summary Page 13 • Ambulance fees are projected to be $450,000 more than budget due to increased call volume and increased ambulance service fees. This revenue is offset by a 50% share with the State for Medicaid-eligible patients. The Village anticipates remitting $290,000 back to the State this year. • The Village was finally reimbursed for its firefighters, captain and equipment deployed to Hurricane Milton in 2024 in the amount of $55,000. These monies offset personnel and supply costs expended at the time; however, the costs attributable for the wear and tear on our apparatus will help offset vehicle maintenance this year. • Interest income is projected to be $119,000 more than the FY26 budget due to interest rate increases in an inflation market. This increase is less those investments that were liquidated for cash flow as the Village awaited Cook County property tax receipts. The Village estimates a loss of $55,000 in interest income during that time. Think of that in terms of six months of salary for a police officer. • Administrative tow fees are projected to be $18,000 more than budget due to more arrests being made due to increased enforcement and special details associated with the IDOT traffic grant. Significant Revenues projected under budget (FY26 proj’d vs. FY26 budget): It should be noted that several of these are revenues with limited control and these are regional and even state- wide issues. • As noted earlier, the projected property tax revenues for FY26 are 70% of the levy, which reflects a decrease of $2,124,443. • Per IML per capita trends, the Local Use Tax indicates a $272,000 less in receipts by fiscal year end. This decrease is a result of a change in state legislation Public Act 103- 0983. • Utility taxes are projected to be $50,000 less than budget due to fluctuating weather patterns. • Vehicle sticker fees are projecting to be $34,000 less than budgeted; even with the anticipated new ordinance, staff will complete enforcement through the Secretary of State database. • This fiscal year was year of the business registration program; it was a slow start building a process and receiving compliance. The Village received about half of the expected revenue or $15,000 less than budgeted. As we move into year two of the program, the Village will need to increase enforcement to receive compliance. It is interesting to analyze the General Fund major revenues outside of property taxes, so many of which are limiting or not within control. Three observations: 1) While at times they are volatile, they are over time relatively flat; 2) Since the opening of the Meijer and nearby development, sales tax has increased dramatically. Unfortunately, there has not been a corresponding growth in our fund balance. These monies have been serendipitous to absorbing increased costs and fluctuations in other revenues; 3) State income tax (the Local Government Distributive Fund), which is the top blue line in the chart below, had been our second largest revenue outside of property taxes until we have seen the monumental growth in sales tax these Page 71 of 76 FY 27 Preliminary Budget Executive Summary Page 14 last several years. While it is thankfully on the rise again, this chart further supports the needed municipal tenacity to defend the State’s ongoing threat to take back a portion or all of this revenue, as the reader will note the dip in the year when the State changed the formula which ultimately negatively impacted the revenue dollars received. IML and the Councils of Government have tried to restore the municipal share in past legislative sessions, but the most it has been raised is to 6.47%, which falls short of the established 10%. In the current legislative session there is another attempt to decrease the shared revenue from 6.47% to 6.23%. Legislators make varied claims as to why the restoration is not needed citing ARPA monies, video gaming and cannabis monies, all of which are false substitutes for the local share of the State Income Tax, which was legislatively promised to municipalities in the 1970’s in lieu of a municipal state income tax. In addition, at the same time as the small restoration of LGDF funds, the State has swept the municipal share of the Corporate Personal Property Replacement Tax and the Local Use Tax. Page 72 of 76 FY 27 Preliminary Budget Executive Summary Page 15 FY27 budget compared to FY26 budget: The Village is budgeting almost an additional $1,090,060 in operating revenue in FY27 compared to FY26. The total fund position for revenues includes several more grants in FY26 compared to FY27. This total fund position may change before fiscal year end with carryovers into FY27. FY27 Budget vs. FY26 Budget Operating Total FY 27 G.F. Revenues $ 14,814,594 $16,006,405 FY 26 G.F. Revenues $ 13,724,534 $17,068,597 $ 1,090,060 $(1,062,192) Significant Revenue over budget (FY27 vs FY26): • Property taxes are budgeted at $317,261 more than FY26 budget (levy to levy comparison). The 2024 levy took the approach of maximizing the levy by including CPI increases which was capped at 3.4% for the first time ever and very little new property increment. • With the approval of the 2025 tax levy and in accordance with the actuarial report, the Village approved the Police and Fire Pension levy line items, totaling about $2 million of levied dollars dedicated for the employer contribution to the police and fire pension funds, which is almost 26% of our total levy. While these pension levies have a corresponding expense associated with each of them, we cannot assume there isn’t an impact to our budget for two reasons: 1) an increase in the police and fire pensions is still within the tax cap and therefore, less of the tax levy is allocated toward other Village expenses and 2) even if the Village does not receive the full pension levy, the Village is still responsible for meeting the actuarial contribution which continues to increase. • Sales tax and non-home rule sales tax continues to trend upward with inflation and therefore, an additional $570,450 is budgeted in FY27. • State income tax is budgeted $60,000 more than FY26 based on IML per capita data. This increase does not reflect the proposed legislation. • Based on trends, the FY27 Casino Tax is budgeted at $127,000. • Ambulance fees are budgeted $350,000 more in FY27 inclusive of the Village’s participation in the GEMT program next fiscal year. This revenue is offset by a budgeted State reimbursement expense of $300,000 in FY27. • Special Fire Services are budgeted $37,000 more in FY 26 due to calls for service increasing with billable service costs collecting more. • Interest income continues to rise in this market in which we expect to yield an additional $19,000 in FY27. • Based on the IML estimate, the Local Use Tax is budgeted $22,000 more in FY 26. Page 73 of 76 FY 27 Preliminary Budget Executive Summary Page 16 Significant Revenue under budget (FY27 vs FY26): • Utility taxes continue to trend downward due to weather patterns and conservation efforts. Revenue in FY27 is budgeted $24,000 less than FY26. • Business Registration fees are conservatively budgeted $10,000 less than originally anticipated when the program started. EAV Impact The Village’s 2024 Equalized Assessed Valuation (EAV) has been determined by the County at $304,621,954. The 2024 EAV represents a decrease of 0.6% (about $1.8M) above the 2023 EAV. This decrease follows a large increase of 37% the Village experienced last reassessment year. The volatility in fluctuations in the EAV have not allowed the Village to make any significant economic recovery post the Great Recession even with historic commercial development in the Village. This second year of a high EAV was last seen in 2009/2010 only to have five years of falling EAV until it reached a low of $192M only to take 10 more years to climb to $306M. That said, recent Village sales data indicates market values the Village hasn’t seen since before the Great Recession with low available inventory. This incongruent data demonstrates the disconnect between economic development, the housing market and the property tax system in Cook County. The State multiplier (equalization factor) for 2024 increased from 3.0163 to 3.0355; an increase of 0.06% which contributed to another increased overall EAV. The new property component of the Village EAV for 2024 was $2,909,667 representing 1% of the 2024 EAV. State politics that impact the homestead exemptions and senior tax freeze only compound a suppressed local economy, placing additional financial pressures on higher incomes, higher valued homes and commercial properties. While this total EAV of $304M is near the level it was 17 years ago, that same amount is expected to support a 2026/2027 budget with historically high inflation. Moving Forward Like many communities, we have been constantly discussing financial trends. The economy continues to be impacted by the pandemic, labor shortage, supply chain issues and now the war in Europe and the Middle East. FY27 GENERAL FUND OPERATING COSTS LESS MAJOR FIXED COSTS Operating Expenditures $ 16,168,007 Personnel Services ($ 8,087,183) Fringe Benefits ($ 4,735,747) Fire Contract Personnel ($ 901,500) IRMA Premiums ($ 290,110) Net $ 2,153,467 Page 74 of 76 FY 27 Preliminary Budget Executive Summary Page 17 Personnel and fixed costs represent 87% of the operating budget, a statistic that is lower than previous years but has been as high as 95%. There is not much room to cut expenses and have a dramatic impact on the bottom line without cutting programs and services. Keep in mind that the phrase “do more with less” will not go very far with this budget and the service areas in our community. As an example, the Fire Department’s paramedic call volume over the last five years has increased 22%, and we do not expect that to slow down. With the influx of commercial development that is occurring, it is reasonable to think the call volume for both police and fire will increase. In addition, over the last ten years, staff across all departments has consumed a larger workload given new mandates and laws as well as a desire to provide services like events. Funding and staffing cannot be reduced and still be able to maintain service delivery and meet unfunded mandates at today’s standards. The impact of a zero percent cost of living adjustment in FY 18 years ago has still had a financial impact on the Village’s budget with a suppressed growth in personnel services. That said, solving a budget issue on the backs of employees is not a long-term financial solution. That fact was supported when an interest arbitrator ruled in favor of the police union and forced upon the Village a 2.38% living adjustment for the police officers that same year. The arbitrator placed the hard decision back on the Village, saying that the Village can make the financial decisions needed to find the monies. The Village fulfilled its obligation per the arbitration award; however, the basis of the arbitrator’s ruling became a circular argument and has placed the Village Board in a difficult position on this issue moving forward. Thankfully, the Village and the FOP were able to recently conclude the 2023-2026 agreement without arbitration and with relatively minimal financial impact to the Village given the skyrocketing increase in CPI. The Village will be back in this predicament again shortly this spring as we return to the negotiating table. Strategic Planning and Decisions The Board’s decision during strategic planning several years ago to move forward with the non- home rule sales tax referendum was one key financial decision that has had a significant economic impact for the past five years. Another key decision was the passage of the G.O. bond referendum for Streets, Sidewalks and Stormwater Improvements which provides a meaningful funding source for streets, sidewalks and stormwater management; the Board has successfully met the strategic planning priority of investment in our infrastructure with the additional “win” of doing so at a time when other debt (the library bonds) were paid off. The Village has been very aggressive in the pursuit of grant funding in recent years, especially with the influx of federal stimulus monies post-COVID. For reference, the FY 24 includes a total of $4 million in grant funding to support large, needed capital projects that may not otherwise have been funded. The consideration of a Places for Eating Tax and a Vehicle Use Fee in lieu of vehicle stickers have been discussed and will be considered as part of this budget process. Both will impact non-residents as well, similar to sales tax. Furthermore, up until now, the Board has been very clear that they have wanted to take all measures to preserve our services as they are today. To that end, they have made economic Page 75 of 76 FY 27 Preliminary Budget Executive Summary Page 18 development a priority in order to grow the property tax and sales tax base, which to this point has preserved Village services. The Board has recently approved a business registration fee and a contractor’s registration fee to help offset the cost of staff who support our Building Department. Should the Board wish to evaluate service priorities, it would be advisable to undertake that effort in conjunction with the process to update our Strategic Plan, for a planned adoption later in 2026. The Village’s Strategic Plan along with other short and long range financial planning tools will provide the Board and Staff the guidelines and guardrails in making key financial decisions in the near future. Summary This report provided an overview of the General Fund and Water Sewer Fund positions projected at the close of Fiscal Year 2026 and budgeted for Fiscal Year 2027. Staff welcomes the Board’s input on modifications to the budget in preparation for its adoption in April. The Village has adequate fund balance to close the revenue/expenditure gap in the short-term, some of which is a planned use of fund balance; using the financial planning tools combined with strategic planning, the Village can thoughtfully and appropriately respond to any shortfalls moving forward, thereby preserving our financial strength. One of the Village’s strengths has been acting on financial planning to address issues such as these, and staff looks forward to working with the Board on the Fiscal Year 2027 budget. Page 76 of 76