Finance Committee

Village of Niles Finance Committee Meeting Council Chambers May 17, 2017 8:00 a.m. Call To Order Chairman LoVerde called the meeting to order at 8:00 a.m. Roll Call Assistant Finance Director Nannini called the roll for Committee members: Committee Members Present: Chairman Joe LoVerde, Bob Callero, John Johann, Paul Nielsen and Al Weel Committee Members Absent: None Village Staff Present: Finance Director Jeff Martynowicz, Village Manager Steve Vinezeano, Assistant Finance Director Laurie Nannini, Deputy Village Manager Hadley Skeffington-Vos, HR Specialist Katy Darr and IT Director Bill Shaw. Old Business None Approval of Minutes The regular minutes from the April 19, 2017 Finance Committee meeting were up for approval, motion made and all concurred. Accounts Payable Approval The approval of the Accounts Payable registers for 2017-4/14, 4/21, 4/28, 5/5 and 5/12 were up for approval, motion made and all concurred. New Business Ceridian HR/Payroll Software Village Trustee George D. Alpogianis was present and asked that the presentation on Ceridian Human Resources and Payroll Software be tabled. IT Director Bill Shaw stated that when staff attended training for the new Community Development software by Tyler they became aware of Tyler’s HR/Payroll software that should be reviewed before any decisions are made. Finance Director Martynowicz added that the Village’s goal is to connect all software modules for the different Departments so they can speak as one. Trustee Alpogianis stated that the next step would be a software presentation by Tyler to the General Government Committee and General Government will make a recommendation to the Finance Committee no later than the Finance Committee’s July meeting. Bob Callero asked that all items for the Finance Committee’s review be received at least one week before the meeting. Motion to table HR/Payroll Software made and on roll call all concurred. Fund Balance Policy Finance Director Martynowicz stated that during this year’s budget process they looked at establishing a fund balance policy, not only for the General Fund but for some of the Village’s other operating funds. He presented a draft Fund Balance Policy for the Finance Committee’s review and explained that they took language from the Government Finance Officers Association (GFOA) handbook and from policies from other communities. John Johann commented that the policy should identify why only five funds are included in the policy and not the others. He also feels there should be a reporting mechanism in place and suggested the Discussion and Analysis section of the Annual Report. Bob Callero commented that he disagrees with this totally. He suggested that under the General Fund section of the proposed policy, the Village should have at least 4 months for emergency needs (which is 33% of your funds). Also, under the General  May 17, 2017 Finance Committee Fund paragraph: “If the unassigned balance falls below the minimum, a plan will be developed to return to the minimum balance within a reasonable period of time” – he feels a “reasonable period of time” should be defined and he suggested 3 months. He stated that the annual budget, which is worked on for over 4 months and approved by the Finance Committee and Village Board, should be the controlling document. Mr. Callero specifically referenced page 4 of the budget which spells everything out. He does not believe a separate policy is needed. Al Weel commented that some of the language is very vague, especially the term “reasonable time”, which should be replaced with a set time limit. He also questioned why this policy is being created now and why would someone want to be in the position and have the ability to move funds around especially with the uncertainty in the market place. Finance Director Martynowicz responded that since he is new it was a good opportunity to put in writing a Fund Balance Policy that complies with GFOA’s standards for better budgeting. Many other communities have similar policies. This policy, after receiving input and approval by both the Finance Committee and Village Board, would give staff direction and guidelines when they start the budgeting process. He would like to incorporate this document into a section called Financial Policies and include this Fund Balance Policy. His goal is to have one policy that incorporates everything that the auditors would be satisfied with. Village Manager Vinezeano stated that establishing an unassigned fund balance policy with a minimum and maximum will: 1) Establish an acceptable level of public funds to be on hand; 2) Essentially earmark unassigned fund balance by a financial policy so it is not considered available for labor raises; 3) Establish a larger fund balance that Moody’s sees as a Village credit strength; 4) Make it acceptable to use unassigned fund balance over the established maximum for non-operational expenditures and/or pensions. Chairman LoVerde requested copies of policies from other communities and asked that this policy discussion be brought back to the next meeting to get a better handle on how this policy works in conjunction with the budget. Finance Director Martynowicz summarized by saying that now is a good time to review this since we just ended the budget process and stated that it is important to have policies to guide staff and help make the whole budget process more transparent. He thanked the Committee for their feedback. Other Business None Public Comment None Adjournment: Motion to adjourn was made and all concurred at 8:27 a.m. Prepared by Village Clerk Marlene J. Victorine on June 7, 2017. 2