AGENDA

FINANCE COMMITTEE MEETING

Monday, October 26, 2015 6:00 P.M.

Countryside City Hall-Council Chambers

I. Call to Order.

II. Roll Call:

Treasurer Caryn Stancik, Chairman

Alderman John Von Drasek, Member

Alderman James Jasinski, Member

Alderman Mark Benson, Member

III. Approval of the Regular Meeting minutes of August 24, 2015.

IV. Public Comment.

V. Presentation of the Audit Report for the fiscal year ended April 30, 2015 by Jim Savio, Partner at Sikich, LLP

VI. Presentation of Monthly Treasurer’s Report for the five months ended September 30, 2015.

VII. Consideration of proposal from Kahoots Creative Group, Inc. to upgrade/rebuild City website.

VIII. Discussion Item: Requested Budget for fiscal year 2017

IX. Update: Summary of IMET Disclosures since last finance meeting as related to recovery efforts for Liquidating Trust Account.

X. Other Business.

XI. Adjournment.

MINUTES

FINANCE COMMITTEE MEETING

Monday, October 26, 2015 6:00 P.M.

Countryside City Hall-Council Chambers

I. CALL TO ORDER

The meeting was called to order at 6:00 PM.

II. ROLL CALL

Those physically present as follows:

Present: Treasurer Stancik, Alderman John Von Drasek, Alderman Mark Benson, Alderman James Jasinski

Also Present: Mayor McDermott, Alderman Musillami, City Administrator Paul, Finance Director Schutter, Al Arneson, Jim Savio

III. APPROVAL OF MINUTES

The Minutes of the Regular Meeting of August 24, 2015 were previously distributed to the members of the Finance Committee.

I move to approve the minutes of the Finance Committee Meeting of August 24, 2015.

A motion was made by Alderman Von Drasek, seconded by Alderman Benson and carried unanimously.

IV. PUBLIC COMMENT-NONE

V. PRESENTATION OF THE AUDIT REPORT FOR THE FISCAL YEAR ENDING APRIL 30, 2015 BY JIM SAVIO, PARTNER AT SIKICH, LLP

Jim Savio presented the FY2015 Audit Report, with the following highlights:

Report begins with Auditor’s Opinion which is the responsibility of the Auditors-all other components of the Financial Statement are the responsibility of Management.

Sikich issued an Unqualified Opinion, which is the highest level of insurance.

General Fund Balance Sheet shows an unassigned fund balance of $10 Million (up from $9.9 million LY) and is a healthy balance at 89% of current year expenses.

General Fund net income after transfers and other sources/uses was $557K.

Balance sheet for the Proprietary Funds shows an unassigned fund balance of $3.3 million for Water and $46K for Sewer

Income statement for Proprietary Funds shows operating income of $69K for Water after depreciation (non cash charge) and negative $61K for the Sewer Fund (after non-cash depreciation charges) which is consistent with the prior year.

Footnote 5(d) shows the effect of the bond refunding which was cash flow savings of $2.3 million and a net economic gain of $1.5 million

Jim Savio presented the FY15 Management Communications Report with the following highlights:

Six adjusting journal entries were noted for the entire City and one pass adjustment was made for an immaterial item.

There was one current year management comment that related to approximately $135K of deposit balances for the FCGC Bank Account that were potentially uncollateralized and represented a little exposure.

No material weaknesses were noted. 1 management comment was noted from the prior year that was corrected in the current year.

Treasurer Stancik inquired as to any questions related to the Presentation. Alderman Von Drasek asked about the potential impact of the Spike Litigation and Swanson matters on the financial statements for future periods. Administrator Paul responded that the actuarial benefit calculations do not reflect the amounts purportedly granted under the Spike assumptions. In addition she communicated that Mr. Swanson will no longer receive benefits from the Pension Fund which typically uses age 80 in the life expectancy assumptions and that Mr. Swanson is approximately 60 years old which should have a positive impact on the financial obligations of the fund.

VI. PRESENTATION OF THE MOTHLY TREASURER’S REPORT

Finance Director Schutter presented the Monthly Treasurer’s Report for the period ending September 30, 2015, with the following highlights:

General Fund surplus of $1.87M which resulted from the sale of land (just under $1 million for Lot 3B in City Center Project) and gains in License/Permits Fees, State Income and State Gaming Taxes.

On the expense side capital projects were significantly under budget due to timing assumptions including a general fund transfer to the Capital Project Fund.

Significant items over budget include legal/litigation costs related to pension spike, Swanson, and Cetwinski matters, maintenance costs in PW Dept, and buy back costs related to the retirement of Officers Mikel and Battaglia.

Due to the budget impasse, Motor Fuel taxes are now two months behind.

Reports show Gaming Taxes up significantly from prior year although receipts are delayed from State of IL budget issues/lack of appropriation.

Hotel/Motel Taxes are up and expenses will end up significantly under budget as Holiday Inn Tax Sharing payments for at least two quarters have been forfeited due to not meeting thresholds in the agreement.

Collected $48,000 in Commercial TIF which will likely be the annual receipts for this period – this amount is about half of what was originally expected.

Concerts in the Park are now complete for the fiscal year and this event closed at a positive variance to budget of approximately $5K.

Capital Project Fund – most expenditures were carryover projects from last year

A motion was made to accept the Treasurer’s Report Alderman Benson, seconded by Alderman Jasinski and carried unanimously.

VII. CONSIDERATION OF A PROPOSAL FROM KAHOOTS CREATIVE GROUP, INC. TO UPGRADE AND REBUILD THE CITY’S WEBSITE

Finance Director Schutter presented the proposal from Kahoots to upgrade and rebuild the city website.

Alderman Jasinski inquired about incorporating a live calendar function that links calendar events on the website with individuals’ calendars. Dave Schutter will look into that option

A motion was made to accept the proposal in the amount of $10,750.00 by Alderman Von Drasek, seconded by Alderman Benson and carried unanimously.

VIII. DISCUSSION ITEM: REQUESTED BUDGET FOR FY2017

Finance Director Schutter presented a draft of the FY2017 requested budget. He communicated that Staff has completed a first-pass through of the budget which involved preliminary meeting with all department heads. There is a preliminary requested budget deficit of approximately $365,000, which includes several different capital projects and equipment purchases – includes approximately $168,000 in equipment and Infrastructure Project costs totaling $332,000 including an allowance for street improvements. Financial Software is also budgeted at $200,000.

Other Revenue line items to note – in 2014 there was asset sale of $400,000 and a $1M tax levy which affects the comparability of the historical trends.

City Administrator Paul added that a $365,000 deficit is not bad at this point. These are just requests at this time. We will be working on the budget again over the next couple of weeks and provide an update at the next Finance Committee. At this point we don’t see any reason to talk about a tax levy. We have taken a conservative approach to estimating revenues.

NO ACTION TAKEN.

IX. UPDATE: SUMMARY OF IMET DISCLOSURES SINCE THE LAST FINANCE MEETING AS RELATED TO THE RECOVERY EFFORTS FOR LIQUIDATING TRUST ACCOUNT

At the last update, they had identified assets of the individuals involved in the fraud. They were going to liquidate those assets. This included 5 hotel properties. They sold 3 of them. The gross sales are $40M for the Florida properties and $10.5M for the New Jersey property. There is a Peoria property that will close by the end of October for about $6M. One other property was under contract which has now terminated. This property has monthly cash flow of approximately $168K, so any delay in the eventual remarketing and sale of the property does not hurt the receivership estate. Everyone should keep in mind that there are several potential liens and claimants against the asset sales including various agencies of the Federal Govt. At this point we still don’t know what our net recoveries will be in this fund.

NO ACTION TAKEN.

X. OTHER BUSINESS

NONE.

XI. ADJOURNMENT

There being no further business to discuss, Alderman Jasinski motioned to adjourn, seconded by Alderman Benson and carried unanimously.

Treasurer Stancik declared the meeting adjourned at 6:29 PM.

APPROVED: 12-8-2015

Treasurer Caryn Stancik, Chairman

/mc