Administration & Finance Committee

APPROVED MINUTES OF A MEETING OF THE ADMINISTRATION AND FINANCE COMMITTEE VILLAGE OF NORTHBROOK COOK COUNTY, ILLINOIS OCTOBER 27, 2015 CALL TO ORDER Trustee Scolaro, Committee Chair, called the meeting to order at 6:39 p.m. On roll call, present were Trustee Scolaro, Trustee Karagianis, and Trustee Ciesla. A quorum was present. Also attending were Trustees Buehler and Israel, President Frum, Deputy Village Manager/CFO Jeff Rowitz, Director of Development and Planning Services Tom Poupard, and Assistant Director/Economic Development Coordinator David Schoon. HEAR FROM THE AUDIENCE None. FY 14/15 YEAR END REVIEW Deputy Village Manager/CFO Rowitz noted per State law the Village’s FY 14/15 Comprehensive Annual Financial Report and Management Letter were presented to the Board of Trustees at the October 13, 2015 meeting. He noted that the original budget projected a $250,000 surplus and the final audited surplus was $2.8 million. The General Corporate Fund ended the fiscal year with $4.4 million above the Villages’ 40% reserve policy. He explained that revenues were over budget by $756,400, which was mainly attributed to higher than anticipated building permit revenue. He reported sales tax was within 0.25% of budget and expenses were considerably under as a result of temporary personnel vacancies during the year and some planned capital expenses which were delayed until FY 15/16. Mr. Rowitz then reviewed the revenue composition and comparative overtime reports. He noted that public works overtime had decreased materially during the third quarter, due to significantly less snowfall during the winter of 2014/15. Mr. Rowitz then reviewed the schedule of outstanding debt and the components of the bond issue planned for November 10, 2015. He also stated that the Village’s Triple-A ratings have been confirmed by Moody’s and Standard & Poor’s. President Frum stated the Village will have to look at the surplus carefully at the next meeting. Chairman Scolaro asked that this be part of the discussion at the Administration & Finance Committee meeting on November 17, 2015. -1- MINUTES OF A MEETING OF THE ADMINISTRATION AND FINANCE COMMITTEE OCTOBER 27, 2015 FIRST QUARTER (FY 15/16) BUDGET REVIEW Mr. Rowitz noted the budget anticipated a $227,000 surplus. At this time, staff is projecting the surplus to be $750,000, mainly due to lower personnel expenses caused by temporary vacancies. He noted that the Police Department just hired 5 new police officers due to retirements and the new officers start at lower pay. In response to a question Mr. Rowitz stated there are currently 2.5 vacancies in Public Works and two in Planning and Development. He stated they are actively recruiting for a Village Engineer and a Public Works Supervisor. In response to a question from President Frum, Mr. Rowitz stated there are no long term vacancies. In response to a question from Trustee Buehler, Mr. Rowitz stated they expect overtime to decline as the new officers complete their training. Assistant Director Schoon presented the Northbrook Economic Data. He stated the office sector vacancy rate has gone down but is still high at approximately 14%. He noted the industrial / flex space vacancy is down but not significantly. He reported shopping centers vacancies remain low. He reported unemployment decreases and noted Northbrook is below the metropolitan Chicago and State levels. He stated hotel revenues are up as a result of increases in room rates as well as occupancies and that is reflected in increase of hotel tax revenue of approximately 12%. Assistant Director Schoon discussed Equalized Assessed Valuations (EAV) in dollars by tax year and noted residential makes up between 65% to 68%. He noted a decrease in industrial EAV that may be due to businesses appealing assessed values. Mr. Schoon discussed average sales of single family detached homes and noted cumulative construction value January through August, which jumped up due to the Northshore 770 projects. He reported the number of major permits issued increased, while the number of single family residential (SFR) permits are trending behind 2014 SFR permits. In response to a question from Trustee Scolaro, Director Poupard noted fourteen SFR permits have been filed but are not shown as issued. Assistant Director Schoon noted building addition permits are the same, commercial permits are up due to the North Shore 770 project and new tenants at Village Square Shopping Center, office permits are down at the lowest level in years, and industrial permits are down from last year. In response to a question from Trustee Scolaro regarding finding employees, Deputy Village Manager Rowitz stated civil engineers are in high demand. Trustee Israel noted many have left the state and they are a highly mobile group. Mr. Schoon stated that during ICDC member’s visits with businesses -2- MINUTES OF A MEETING OF THE ADMINISTRATION AND FINANCE COMMITTEE OCTOBER 27, 2015 they are hearing that employers are having a hard time filling positions from entry level jobs to highly skilled positions. There was a discussion regarding the developer of the Northshore 770 apartment building having difficulty finding tradesman and Mariano’s having trouble hiring employees. Trustee Israel suggested there may be a commute issue in regard to surplus job openings in Northbrook and perhaps augmenting the commute with transit options such as shuttle from the Metra stations may help. Assistant Director Schoon stated the ICDC has been discussing these issues and one thing to note that programs such as Pace shuttle bug bus programs are not beneficial for retailers because they only operate during peak commute times, and retail employees often have shifts that do not correspond with that. Deputy Village Manager Rowitz said in the past Pace’s numbers have not been sufficient to justify new routes in Northbrook but perhaps the numbers are there now. Trustee Scolaro stated higher pay will entice people to work in Northbrook. ADJOURN At 7:14 p.m., Trustee Ciesla moved, seconded Trustee Karagianis, to adjourn the meeting. The motion passed on a voice vote. Respectfully submitted, Joan Espana Recorder -3-