Finance Committee

Finance Committee Meeting Council Chambers January 22, 2013 8:00 a.m. Attendance: Committee Members Present: Mayor Robert Callero, Interim Village Manager Steve Vinezeano, John Johann and Finance Director Scot Neukirch Committee Members Absent: Chairman Joe LoVerde Non Committee Members Present: Trustee Rosemary Palicki, Trustee Louella Preston, Village Attorney Joe Annunzio and resident Mary Marusek. Call To Order: Meeting opened at 8:04 a.m. Approval of Minutes: The minutes from the December 19, 2012 Finance Committee meeting were up for approval, motion made and all concurred. Accounts Payable Approval: The approval of the Accounts Payable registers for 12/14/2012, 12/21/2012, 12/28/2012, 1/04/2013 and 1/11/2013 were up for approval, motion made and all concurred. New Business .25% Sales Tax Increase Update: Finance Director Neukirch gave an update on the receipts for the .25% local sales tax increase that went in to effect as of July 1, 2012. The sales tax increase was designed to provide additional funding for the storm water relief project with any residual amount left going to help fund the Police and Fire Pension Funds. Neukirch explained that the 4 months of receipts are tracking slightly below budget. The expenses budgeted in the Water Fund for the storm water relief project are projecting below budget. As of the meeting, it looked like the Village may be able to contribute more to the pensions than was budgeted by fiscal year end due to the reduced requirements for the storm water relief project in FY 13. 2014 Budget Progress Report: Finance Director Neukirch gave an update on the progress of the FY 2014 budget. Neukirch explained that the schedule to have the Finance Committee’s review of the budget at the February 20, 2013 meeting might be difficult for staff to meet. Neukirch will update the staff on the progress as the February meeting date approaches. But overall Neukirch said the budget process is progressing and staff has been working hard on this stage which is the most labor intensive part of the process. Trustee Requests for Budget: Mayor Callero updated the Committee that several trustees have submitted budget requests and that staff is working on responses and/or incorporating those requests in to the budget. Dept Head Increase Budget Issue: Finance Director Neukirch explained the potential problem with the way the increases to Directors and some staff members were administered for FY 13. The method used may have an unintended impact on wages in the FY 2014 budget and future budgets. Some staff members received a “bonus” instead of an increase to their base pay for FY 2013. Neukirch discussed the memo he provided to the Committee which illustrated how the bonus each year needs to be increased just to keep the employee receiving an annual increase otherwise the situation may arise where an employee’s pay may actually be declining. John Johann explained that he didn’t feel the recommendation the Committee gave last year was intended to reduce employees’ pay and was concerned that the Village may lose valuable employees if this is not corrected. The Committee recommended that moving forward Directors get the same market adjustment that the rest of workforce receives and then a separate pool be established for bonuses as needed be established. Staff was directed to address this issue with the Village Board when salaries are discussed as part of the FY 2014 budget process. Public Comments: Trustee Preston made comments and asked questions regarding the difference between merit, COLA and bonuses. Trustee Preston made comments and asked questions concerning the type of budget method the Village utilizes. Trustee Preston also made some suggestions on changes to the budget schedule due to a conflict with a holiday. Other Business: None Executive Session: None Adjournment: Motion to adjourn was made and all concurred at 8:43 am. Next Meeting The next Finance Committee meeting is scheduled for Wednesday February 20, 2013 at 8:00 a.m. in the Council Chambers. Prepared by Scot Neukirch on 1/22/2013