City Council

MINUTES CITY OF DEKALB COMMITTEE OF THE WHOLE MEETING JULY 24, 2017 The City Council of DeKalb, Illinois held a Committee of the Whole meeting on July 24, 2017, in the City Council Chambers of the DeKalb Municipal Building, 200 South Fourth Street, DeKalb, Illinois. Mayor Smith called the meeting to order at 5:00 p.m. A. ROLL CALL City Clerk Herrmann called the roll, and the following members of the City Council were present: Alderman Dave Jacobson, Alderman Bill Finucane, Alderman Mike Marquardt, Alderman Pat Fagan, Alderman Kate Noreiko, Alderman Mike Verbic, Alderman Tony Faivre, and Mayor Jerry Smith. Also present were: City Manager Anne Maria Gaura, Assistant City Manager Patty Hoppenstedt, City Attorney Dean Frieders, Interim Finance Director Jeff Wilkins, Police Chief Gene Lowery, Fire Chief Eric Hicks, Community Development Director Jo Ellen Charlton, Public Works Director Tim Holdeman, Information Technology Director Marc Thorson, Human Resources Director Cris Randall, Management Analyst Aaron Stevens, Economic Development Planner Jason Michnick, Police Commander Jason Leverton, and City Clerk Susanna Herrmann. B. ITEMS ALSO ON THE REGULAR AGENDA There were none. C. CONSIDERATIONS 1. Code Compliance, Building and Economic Development. Community Development Director Charlton provided overview of this item and stated that code compliance staff will remain the same. However, the City has recently undergone some internal reorganization to increase efficiency and maximize appropriate use of the limited resources available for code compliance, building review, and property maintenance. She further explained that prior to the recession, the City operated with an in-house Building Division, responsible for code enforcement, new construction and building renovation, that had a significant staff associated with it. In 2008, the City underwent a staff reduction in the Building Division as a component of budgetary cuts, resulting in the elimination of most of the staff. At the conclusion of that process, the Building Division had three employees who were tasked with code enforcement, plan review, and building inspections. Code enforcement was significantly curtailed to a reactive model, which (through no fault of the limited staff available) resulted in a backlog of code enforcement throughout the community. In addition, the City utilized a Fire Prevention Lieutenant (FPL) in the Fire Department to provide fire-related plan review and license-based inspections.  Committee of the Whole Meeting Minutes July 24, 2017 Page 2 of 5 Community Development Director Charlton continued, stating that over a multi-year period, the City Council considered the issue of code enforcement for residential property, both owner-occupied and rental, culminating in the creation of the Crime Free Housing Bureau (CFHB). Workload projections at the time identified the need for significant additional staffing in order to meaningfully address then-current code enforcement issues in the community. Limited resources only allowed for a limited number of positions to be created, with a full-time coordinator and part-time inspectors being authorized. Those positions were filled and the CFHB existed as a component of the Police Department. Mayor Smith reminded viewers that Committee of the Whole (COW) meetings are designed to provide information on items of consideration and there would be no action taken on this item at this meeting. Will Heinisch of the DeKalb Area Rental Association (DARA) introduced himself and mentioned some of his qualifications in relation to this item. He offered background information on the development of the CFHB and stated that DARA agrees with the decision by staff to move the CFHB to the Community Development Department, with the exception of crime incident reporting, registration, and landlord classes, which he believes should stay in the Police Department. He provided Council with a packet of information including discussion questions to consider, requests to Council, statistics, and historical perspective on past Council action in reference to the CFHB. To conclude his presentation, he emphasized on the request by DARA for a sit-down meeting with Council to discuss the issues listed in the packet he provided. Mayor Smith commended Mr. Heinisch for the completeness of his presentation. City Manager Gaura noted that Police Chief Lowery made a consolidated presentation to DARA regarding this item in the spring, and stated that representatives from DARA are often present at the monthly Business Coordination meetings hosted by City staff. She expressed her feeling of disconcertment that this topic was brought forth at a public meeting. Because of the minimal time allotted for COW meetings, City Manager Gaura recommended that staff be allowed the opportunity to address these issues with DARA and follow up with Council at a subsequent meeting. Alderman Jacobson provided historical information regarding the existence of the CFHB and voiced his concerns regarding the rearrangement of programs. He discussed the arduous process of developing the CFHB and stated that staff made a poor choice in moving forward with changes to the placement of the program without the input of Council, considering all of the effort that went into its original implementation. Although the acknowledged that it is too late for these changes to be reversed, he wondered if the CFHB still exists and if so, what parts of the program, if any, are essential. City Manager Gaura replied that the CFHB still exists and stated that the only component that has changed is the department location. She referred to Police Chief Lowery to address Alderman Jacobson’s concerns. Committee of the Whole Meeting Minutes July 24, 2017 Page 3 of 5 Police Chief Lowery provided his perspective regarding the CFHB and recognized their astounding ability to collaborate with property owners and managers. In his experience with the CFHB, the program has proven to be valuable and repeatedly effective. He stated that the focus should be on the value of the program and watching as its goals are obtained. Police Chief Lowery continued, acknowledging the many achievements of the CFHB and stated that the mission of the program was enhanced when all three entities (Code Compliance, Building, and Development) were placed in the same department. He attested to some of the issues the City was facing as the result of a previous lack of communication between those separate entities, and concluded his report by stating that the CFHB is a necessary mechanism to the success of the City in many different aspects. Alderman Noreiko wondered if the reduction of incidents reported by the CFHB are due to the active presence of Code Compliance officers to ensure that the City’s standards are met. Community Development Charlton concurred with City Manager Gaura that staff will meet with DARA, discuss the issues brought forward by Mr. Heinisch, and follow up with Council at a subsequent meeting. She also echoed Police Chief Lowery that the CFHB is a successful program. Alderman Jacobson agreed that the program is successful but expressed frustration that there was no discussion with Council regarding the reorganization of internal departments. He asserted that without publicly discussing the costs involved in a staff reorganization, the City and Council have become derelict in their duties. Alderman Verbic agreed with Alderman Jacobson that this information should have been presented to Council prior to the department reorganization by staff. He also suggested changing the name of the CFHB to exclude the words “Crime Free”. City Manager Gaura acknowledged the concerns of Mr. Heinisch and stated that staff will organize a meeting with DARA to address the issues brought forward in the packet provided to Council. She addressed Alderman Verbic and consented to including an update on the CFHB at the next monthly budget discussion. In conclusion, City Manager Gaura addressed Alderman Jacobson’s concern that there was no public discussion regarding the reorganization of the CFHB, and assured him that staff has been reaching out to the community on this matter using other methods. Alderman Verbic expressed his interest in hearing more input from residents and business owners regarding this issue. Police Chief Lowery briefly discussed Alert DeKalb, a mechanism put in place by the Police Department and the CFHB for anonymous reporting of code violations. Mayor Smith addressed Mr. Heinisch and agreed to a meeting with DARA to discuss the topics of concern outlined in the packet given to Council. Next, he addressed Information  Committee of the Whole Meeting Minutes July 24, 2017 Page 4 of 5 Technology Director Thorson and asked if a portion of that document could be posted on the City’s website for the benefit of the public. City Manager Gaura noted that the document’s contents would be reflected as part of the official meeting minutes recorded by City Clerk Herrmann. Mayor Smith reiterated the time constraint placed on discussion due to the Regular meeting time of 6:00 p.m. and asked Interim Finance Director Wilkins if the Rating Update in the next topic of discussion can be presented in less than 10 or 15 minutes. Interim Finance Director Wilkins responded in the affirmative. 2. Rating Update by William Blair Managing Director Elizabeth Hennessey. Interim Finance Director Wilkins introduced William Blair Managing Director Elizabeth Hennessey. Ms. Hennessey provided an overview of this item, stating that by using Moody’s Investor Rating Surveillance Survey, the City’s rating dropped from an “Aa3” rating to an “A1” rating. She provided detailed rating information and discussed some of the contributing factors that would cause a municipality’s rating to rise or fall. She noted some of the positive marks in the report and gave a brief rating history of the City. Discussion ensued between Alderman Jacobson and Ms. Hennessey regarding the future of the City, specifically in regard to pension funds, based on the calculations presented. Alderman Jacobson voiced his understanding that staff intends to come closer to current pension benchmarks and asked when Council could expect an update regarding the matter. City Manager Gaura confirmed that staff will be presenting an actuarial report to the Finance Advisory Committee (FAC) in September and they will work hand in hand to determine if there are any necessary modifications or recommendations that need to be made to pension allocation. Alderman Jacobson advised his fellow Council members to keep in mind that the amount owed, in terms of liability, significantly outweighs the amount that is saved in the Fund Balance, which caused the drop in the City’s bond ratings. Ms. Hennessey clarified that there is a difference between “debt”, which is manageable, and “pensions”, which is the main contributing factor to the rating. However, the scale used by Moody’s combines those two factors into one consideration. She informed Council that it would be beneficial to devise a plan that would incorporate both cost control and payment management. She also stated that there are two different kinds of debt: general obligation debt, which is guaranteed by the tax base, and revenue bond debt, which is designated for more specific revenue bonds. Concluding her presentation, she noted that staff received a second opinion from an online rating estimator, which placed Committee of the Whole Meeting Minutes July 24, 2017 Page 5 of 5 the City at a “AA–“. She also noted that it can be helpful to have scores from two different bond rating agencies, but it may not prevent investors from considering Moody’s rating. Mayor Smith asked Ms. Hennessey for clarification that many issues presented in the report are controllable, excluding the debt and contingencies, which are tied into the pension. She replied, yes. Mayor Smith also asked Ms. Hennessey to confirm that this specific issue is common in other municipalities, which she did. Alderman Noreiko asked Ms. Hennessey how common the City’s situation is. She replied that it is very common, and some municipalities are in worse condition than DeKalb. Alderman Faivre provided a brief history of past rating practices and stated that as a result of past poor judgment, Moody’s is being very conservative with their scores. Mayor Smith reiterated that some of the issues presented in the report are controllable, but expressed the importance of continuing to look at revenues and expenses. D. PUBLIC PARTICIPATION There was no one registered to speak. E. RECESS FOR EXECUTIVE SESSION OF THE CITY COUNCIL 1. Approval to Hold an Executive Session to Discuss Pending or Imminent Litigation as Provided for in 5 ILCS 120/2(c)(11). Not acted on. F. ADJOURNMENT MOTION Alderman Jacobson moved to adjourn the Committee of the Whole meeting; seconded by Alderman Fagan. VOTE Motion carried on an 8-0 voice vote. Aye: Jacobson, Finucane, Marquardt, Fagan, Noreiko, Verbic, Faivre, Smith. Nay: None. Mayor Smith declared the motion passed and adjourned the Committee of the Whole meeting at 6:06 p.m. ________________________________ SUSANNA HERRMANN, City Clerk Approved by City Council: August 28, 2017.