Finance Committee

Finance Committee Meeting Council Chambers April 11, 2012 8:00 a.m. Attendance: Committee Members Present: Chairman Joe Lo Verde, Mayor Robert Callero, John Johann, Village Manager Van Geem and Finance Director Scot Neukirch Committee Members Absent: none Non Committee Members Present: Trustee Chris Hanusiak, Trustee Louella Preston Meeting Opened: Meeting opened at 8:03 a.m. Approval of Minutes: The minutes from the February 22, 2012 were up for approval. Motion made, all concurred. Accounts Payable Approval: The motion was made and all concurred to approve the Accounts Payable registers for 2/10, 2/17, 2/24, 2/24(106), 3/2, 3/8, 3/16, 3/22, 3/30. Budget Update Finance Director Neukirch updated the Committee on the status of the FY 2013 Proposed Budget. Neukirch reviewed the major changes made to the document during the 3 open budget workshops held with the Village Board. The funding of the Police and Fire Pension Plans was discussed along with the Village Board’s plan to consider contributing more to the Pension Plans in October or November depending on the results of the FY 12 audit and the state of the economy. Neukirch explained that there will be a statutorily required budget hearing as part of the regularly scheduled April Board Meeting. The appropriation ordinance will be presented to the Board for approval at the May Board Meeting. Questions and discussion followed. Chairman Lo Verde expressed concerns about the potential disparity between union and non union employees’ salary adjustments since the budget includes a 1% increase for non unions and there is no guarantee that the union employees will only get a 1% increase. He also expressed concern that increasing the non union employees’ health care costs by 50% may create an uneven disparity with the union employees if the unions are not required to contribute the same after the negotiations are complete. It was pointed out by Chairman Lo Verde and confirmed by Village Manager Van Geem that some employees will actually make less next year with only a 1% salary increase and a 50% health insurance increase. There also was a discussion concerning out of town travel for employees and Board members. During the budget workshops various Board Members were interested adding an out of town conference for the Village Board. The Mayor was opposed to adding this to the budget and discussion was had about options for adding it to the budget. Fund Balance Policy Finance Director Neukirch presented the proposed Village of Niles Fund Balance Policy. Neukirch explained that this Policy needs to be passed by the end of the fiscal year as part of the audit requirements outlined in GASB 54. For the FY 2012 audit, the fund balances in the various funds will be broken down in to levels of restrictions that are defined in the Policy. The Policy also commits the Fitness Center’s revenue to the operations of the Fitness Center. This was necessary in order for the Fitness Center to remain a special service fund and not get absorbed by the General Fund. The Policy also designates the Finance Director with the authority to “assign” fund balance within the funds for the purpose of defining management’s intentions in the financial statements. The Policy also sets the floor of the General Fund’s reserves at 25% of estimated annual expenditures. There were questions and discussion on the Policy along with the operations of the Fitness Center. Certificate of Achievement Chairman Lo Verde read the notice from the Government Finance Officers Association (GFOA) to the Village of Niles explaining that the Niles Finance Department has received the Certificate of Achievement for Excellence in Financial  Reporting. This is the highest form of recognition in the area of governmental accounting and financial reporting. Next Meeting The next Finance Committee meeting is tentatively scheduled for Wednesday May 16, 2012 at 8:00 a.m. in the Council Chambers pending the members’ availability. Prepared by Scot Neukirch on 4/11/12