Finance Advisory Committee

NOTICE OF CANCELLATION The Special Joint Meeting of the City Council and Finance Advisory Committee scheduled for Monday, November 5, 2018, has been cancelled. DATE: October 31, 2018 TO: Honorable Mayor Jerry Smith City Council Finance Advisory Committee Chair Michael Peddle Finance Advisory Committee FROM: Molly Talkington, Interim City Manager Raymond Munch, Interim Assistant City Manager SUBJECT: Proposed FY2019 General Fund Budget Balancing Measures. I. Summary At the direction of the Finance Advisory Committee (FAC), staff updated the Five-Year Financial Plan (Plan) as part of the Fiscal Year (FY) 2019 budget process. Updates to the Plan revealed the existence of a structural imbalance in the City’s revenues and expenditures. Based on the updated figures in the FY2018 Estimate, the FY2018 General Fund ending unassigned fund balance is projected at 23.8% of expenditures, a shortfall of $457,000. This structural imbalance is carried into the FY2019 through FY2023 projections. An additional $1.2 million shortfall is projected for the FY2019 budget. Staff has worked with the City Council and FAC to identify budget-balancing measures to bring the FY2019 Proposed Budget in line with the City’s financial policy. Those budget- balancing measures have been discussed over several months, and those discussions have resulted in consensus on budget-balancing measures that bring the FY2019 Proposed Budget within $240,742 of meeting the FY2019 General Fund ending unassigned fund balance to $9.4 million which is 25% of expenditures or to 30% of expenditures minus property tax revenue. A review of previous discussed budget- balancing measures, along with several new measures, are now presented to City Council and FAC for further consideration. II. Background Prior Council Action  On January 8, 2018, City Council supported a new budget process for the FY2019 Budget to clearly tie the City Council’s goals to budget action plans.  On January 24 and February 20, 2018, City Council identified and prioritized goals to set five short-term goals to be completed in 12 to 18 months and five long-term goals that extend beyond 18 months.  Between March 20, 2018, and June 18, 2018, all City departments completed a service level and a Fiscal Year 2018 line item review.  On March 26, 2018, Finance Director Talkington presented City Council with several options for incorporating a review of the FY2018 Budget as part of the FY2019 Budget Workshops.  The Budget Basics video was debuted at the April 17, 2018, Special Council meeting. This video is an overview of what services the City of DeKalb provides and how an annual budget is created to provide those services. Schedule Update Date Who Meeting Topic January 8, 2018 City Council Fiscal Year 2019 Budget Schedule & Service Level Reviews – Snow and Ice Removal Plan & Refuse, Recyclables, and Yard Waste Contract Update Completed January 16, 2018 Finance Advisory Committee Five-Year Financial Plan Review Completed January 22, 2018 City Council Service Level Review – Human Services Funding Report & Tax Increment Financing Policy Direction Completed January 24, 2018 City Council Strategic Plan and Goal Setting Session Completed February 12, 2018 City Council Service Level Review – State of Technology Deferred to March 20, 2018 Completed February 20, 2018 City Council Budget Workshop – Service Level Reviews Changed to continued City Council Goal Setting Completed February 26, 2016 City Council Fiscal Year 2017 Strategic Plan Update Deferred to March 12, 2018 Completed Page |2 Date Who Meeting Topic February 27, 2018 Finance Advisory Committee Five-Year Financial Plan Review continued (if needed) & Begin Financial Policies Review Completed March 5, 2018 Staff Budget Basics Video Release Released on April 17, 2018 March 27, 2017 Finance Advisory Committee Financial Policies Review continued Completed April 17, 2018 City Council Budget Workshop – Service Level Reviews Completed April 24, 2018 Finance Advisory Committee Financial Policies Review continued Completed April 2018 (end of Actuary Police and Fire Pension Funds month) Actuarial Reports Final Received May 15, 2018 Finance Advisory Committee Financial Policies Review continued (if needed) Completed May 22, 2018 City Council Budget Workshop – Service Level Reviews & Financial Policies Review Completed June 19, 2018 City Council Budget Workshop – Service Change to June 18, Level Reviews & Financial 2018 Policies Review Completed June 26, 2018 Finance Advisory Committee Fiscal year 2018 Year-to-Date Budget Update & Five-Year Financial Plan Review Completed July 10, 2018 City Council Budget Workshop – Financial Policies Review continued, Fiscal Year 2018 Year-to-Date Budget Update & Five-Year Financial Plan Review to set Budget Strategy July 10, 2018 Staff Fiscal Year 2019 Budget Development Begins - Underway August 7, 2018 Finance Advisory Committee Audit & Actuarial Reports Review Completed Page |3 Date Who Meeting Topic August 21, 2018 City Council Budget Workshop – Audit & Actuarial Reports Review Completed Begin 2019 Budget Review Deferred to Sept 18 September 11, 2018 Finance Advisory Committee Property Tax Levy & Fiscal Year Change to 2019 Budget Preview Review September 12, 2018 Completed September 18, 2018 City Council Budget Workshop – Property Tax Levy & Fiscal Year 2019 Budget Preview Review Completed September 25, 2018 Finance Advisory Committee Budget Preview Review continued (if needed) Completed October 16, 2018 City Council Budget Workshop – Property Tax Levy continued & Fiscal Year 2019 Budget Preview Review continued (if needed) Completed October 23, 2018 Finance Advisory Committee Budget Preview Review continued (if needed) Completed October 2018 (end DeKalb County Anticipated Receipt of the of month) Estimated Equalized Assessed Valuation Received Late October/Early Staff Release the Fiscal Year 2019 November Proposed Budget document Underway November 6, 2018 City Council & Finance Joint Meeting to Review the Change to Advisory Committee Fiscal Year 2019 Proposed November 5, 2018 Budget November 12, 2018 City Council Estimated 2018 Property Tax Levy Adoption (Determines if Truth in Taxation Notice is Required) November 26, 2018 City Council Committee of the Whole – Public Hearing for 2018 Property Tax Levy Regular Meeting – Public Hearing for the Fiscal Year 2019 Annual Budget, First Reading of the Annual Budget & First Reading of the 2018 Property Tax Levy Page |4  Date Who Meeting Topic December 10, 2018 City Council Second Reading of the Fiscal Year 2019 Annual Budget & Second Reading of the 2018 Property Tax Levy December 25, 2018 Staff Last Day to File the Annual Budget and 2018 Property Tax Levy with the County January 1, 2019 Fiscal Year 2019 Begins Financial Forecast At the July 10, 2018, Budget Workshop, staff presented City Council with the first annual update of the Five-Year Financial Plan. The revenue and expenditure projection (forecast) included in the Plan indicate that the City is operating in a structural deficit, which in simpler terms means that expenditure growth is outpacing revenue growth. The City’s structural imbalance is not unlike many other municipalities, in that, the City has pension obligations that consume a great deal of its fiscal resources. This places greater demand on other revenue sources. In the Plan, the FY2018 Estimate was updated to reflect information that is now known. Two changes affected the General Fund ending unassigned balance. First is the inclusion of the Peace Road Interchange Agreement expenditure to the County. This was not included in the FY2018 Budget since it was identified through the initial Plan as having met the financial obligations of the agreement. Second, Building Permits and other related permits were updated to reflect current project information. This included removing permit funding related to the STEAM project and the subsequent outgrowth since the STEAM project is no longer under consideration. Based on all the updated figures in the FY2018 Estimate, the FY2018 General Fund ending unassigned fund balance is projected at 23.8% of expenditures. The City’s current financial policy is 25% of expenditures. This is a shortfall of $457K. This structural imbalance is carried into the FY2019 through FY2023 projections. The FY2019 budget shortfall is an additional $1.2M. Page |5  General Fund Ending Fund Balance as Compared to Policy 12.0 10.0 8.0 6.0 Millions 4.0 2.0 0.0 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 Actual Estimate Projection Projection Projection Projection Projection Ending Fund Balance Unassigned Fund Balance at 25% of Expenditures Target Unassigned Fund Balance at 30% of Expenditures less Property Tax Revenue Target Budget Balancing Strategy Based on the revenue and expenditure forecast outlined above, the recommended budget strategy is to prepare the FY2019 Proposed Budget to meet the General Fund unassigned fund balance policy. This requires $1.68 million in budget-balancing measures to be enacted with the FY2019 budget adoption to reach the recommended General Fund unassigned fund balance policy of 30% of expenditures less property tax revenue. Budget balancing measures can be expenditure reductions, revenue increases, or a combination of both to bring the fund balance to policy level. These measures, when taken early in the forecast, help course correct the following years of the financial forecast. In July, the City Manager tasked each City department to develop service focused budget- balancing options at a level equal to the department’s percentage of the total General Fund budget. Department heads were asked to carefully evaluate service levels and identify areas for potential service reduction or elimination. Department heads were instructed to explain the service reduction impact first, then the associated expenditures (staff, materials, equipment, etc.) to be evaluated as part of that reduction. Additionally, department heads were encouraged to evaluate current and potential revenue sources in arriving at their budget-balancing target. While the Department heads were formally tasked with developing these options, City Council, all employees, union groups, and the public were asked to share any ideas they may have. In August, each department head submitted their proposed budget-balancing measures. Those proposals were evaluated by the City Manager’s Office and additional information was sought where necessary. City Council is now presented with a package of proposed budget-balancing measures for consideration. The following outline details updated revenue projections, new and increased revenues, and expenditure reductions. The proposed expenditure reductions change the way services are delivered throughout the Page |6 City, resulting in staffing reorganization and reductions. Staffing changes were evaluated both individually and across the organization based on service needs. Staff recognizes that the decisions required to be made as part of this process are difficult ones and depending on the budget-balancing measure chosen could result in layoffs. The City Manager has taken the utmost effort to minimize layoffs of current employees. The recommended measures use attrition, vacant positions, and relocation of current employees in eliminated positions to another position that is planned to remain in the organizational structure. Should the City Council decide that one or more components of the recommended budget-balancing package are not preferred, several alternative measures are detailed as well. III. Actions Taken to Date: Staff presented a list of budget-balancing measures to the City Council and FAC and discussed the proposed measures over the course of several meetings of the respective boards during the months of September and October. These budget-balancing measures include recommended measures that included significant expenditure reductions paired with new or increased revenues. In addition to the recommended measures, staff presented a list of alternative measures that were identified as being measures that are possible to implement but not preferred over those on the recommended list. Those measures again included both expenditure reductions and revenue increases. After a preliminary discussion of these measures during September meetings, staff developed an electronic survey and distributed that survey to all members of the City Council and FAC. The survey was constructed in a way that asked each respondent to cite their preference to each of the recommended and alternative measures presented by answering Yes, No or Maybe. The survey was anonymous; however, separate surveys were presented to City Council and the FAC in order to differentiate the opinions of the two boards. The responses were discussed in greater details at the FAC meeting on October 10 and the Special Committee of the Whole meeting on October 16. At those meetings, staff asked for consensus on each of the budget-balancing measures listed. Recommendations made by the FAC were provided to City Council prior to the October 16 meeting to guide the City Council’s discussion on these items. At the October 16 meeting, City Council considered each of the recommended and alternative budget-balancing measures. Out of that discussion came consensus on the implementation of budget-balancing measures totaling $1.68 million, which achieved the budget-balancing target. This target was based upon a forecast that included figures for the 2018 Property Tax Levy that were based upon the policy direction provided by City Council at the October 8 Committee of the Whole meeting. At the conclusion of the October 16 Special Committee of the Whole meeting, City Council engaged in further discussion on the 2018 Property Tax Levy and provided staff with new policy direction related to the levy. Based on the City Council’s most recent 2018 Property Tax Levy policy direction, the funding gap increases by an additional $210,000 under the current Fund Balance Policy of 25% of expenditures. If the City Council were to follow the alternative Fund Balance Policy recommended by FAC, which is 30% of expenditures less property tax revenue, the funding gap increases to $262,000. Page |7 At the October 24 FAC meeting, the FAC reviewed the Council direction on the budget- balancing measures and the revised property tax levy direction. To address the remaining funding gap identified through those decisions, the FAC provided further recommendations for Council consideration at the Joint meeting as follows: 1. The FAC does not support using fund balance for the FY2019 budget as a budget- balancing measure. (4-0 vote; Parch and Parker absent) 2. The FAC supports Council direction for the following: a. Reduce the Municipal Band funding by $10,000 (all in favor) b. Eliminate the Metro West/Metropolitan Mayors’ funding (3-1; Peddle not in favor) c. Keep the funding for Social Service Agreements (all in favor) d. Keep the DeKalb Chamber of Commerce support (all in favor) e. Keep the DeKalb County Economic Development Corporation support (all in favor) f. Reduce the DeKalb County Convention & Visitors Bureau funding by $10,000 (all in favor) g. Keep the Local Athletic Sponsorships (all in favor) h. Continue exploring funding models for the Airport (all in favor) i. Reduce the Non-Bargaining Unit salary increase to 1.25% (all in favor) j. Do not use a SUV Fast Response Fire Vehicle (all in favor) k. Do not use a Mini-Pumper Fast Response Fire Vehicle (all in favor) l. Do not increase the Home Rule Sales Tax for operating (all in favor) m. Increase the Hotel/Motel tax by 0.50% (all in favor) n. Do not increase the Electric and Gas Utility taxes (all in favor) o. Add a Self-Storage Facility Use tax (all in favor) p. Continue research on adding an Amusement/Entertainment tax (all in favor) 3. FAC did not support the Council direction on the following and provided further recommendations: a. Explore the Home Rule Sales tax increase as a funding source for street and fleet b. Explore the Restaurant, Bar and Packaged Liquor tax as a budget-balancing measure for the General Fund and/or for capital needs c. Increase the Video Gaming Terminal Renewal Fees (all in favor) To provide an opportunity for City Council and FAC, together, to balance the FY2019 Page |8 Proposed budget without reliance on the fund balance, staff has updated the list of potential budget-balancing measures to include expenditure and revenue options previously considered but not preferred by City Council. As well, several expenditure reduction options have been included that were not previously discussed. City Council had also requested additional information related Crime Free Housing and City Inspection Programs, one of the more complex budget-balancing measures initially offered. Initially, measures related to those programs were package under four options. While City Council reached some consensus on this topic, it was clear that the Council desired more information on which to base further decisions. IV. Alternative Expenditure Reductions The following list of budget-balancing measures includes those items previously considered but not preferred by City Council, items considered that required more information (Crime Free) and items not previously offered for consideration. Following are alternative measures to consider aside from those already indicated as preferred by City Council: Previously Considered – Not Preferred: 1. Eliminate Information Technology Director – ($131,830) The position of Information Technology Director is eliminated under this model. Current staffing, resources, and funding have made it difficult for the Director to achieve the goals set forth when the position was created in 2016. In many instances, the Director is providing general tech support to City staff as a result of staffing reductions in prior years, resulting in already limited resources in the department. The elimination of this position represents a $131,830 cost savings to the General Fund; however, the service level impact is significant as this department was reduced by one (1.00) FTE in FY2018. A more comprehensive review of the structure and staffing of this department is needed in the upcoming fiscal year. 2. Eliminate One (1.00) Firefighter – ($99,353) The Fire Department currently maintains a shift staffing of 13 personnel. The department could eliminate one (1.00) Firefighter position. This would essentially reduce staffing on one of three shifts, which would require the department to backfill using the department’s swing shift personnel to maintain shift staffing of 13. The elimination of one (1.00) Firefighter position would be accomplished through attrition on January 4, 2019, through an announced retirement. The General Fund cost savings for this change is $99,353. 2a. Authorize Firefighter Over-Hire Funding - $49,676 Given the proposed staffing reductions in the Fire Department, future vacancies created through retirement or resignation could have a more profound impact on service delivery and overtime costs. It is proposed that funding is included in the Fire Department budget to authorize an over-hire at the rank of Firefighter for a period not to exceed six (6) months. Over-hire funding would be used to fill an anticipated vacancy in the Fire Department in Page |9 a manner that would reduce any significant gap in staffing. This model essentially authorizes the department to exceed the authorized staffing level for short periods of time for the sole purpose of replacing a known vacancy in a more expeditious manner, thus reducing the impact to service delivery. The budgeted cost to the General Fund is $49,676; however, the funds may not be fully expended in any given year. Note: This additional funding is directly tied to the elimination of a Firefighter position and should not be considered otherwise. 3. Eliminate up to Two (2.00) Police Officers – ($177,630) Three (3.00) Police Officers will retire in January 2019. Those Officers have already been removed from active service but are still on the payroll as the Fraternal Order Police collective bargaining agreement allows for the use of their accumulated leave to extend service time before retirement. Reduction of up to two (2.00) Police Officer positions could be implemented and made effective upon the actual retirement date in January 2019. The cost savings of one (1.00) Police Officer position in the first year is $88,815. Note: City Council previously considered and approved of the elimination of one (1.00) Police Commander position through attrition on or about June of 2019. This brings the Police department’s authorized sworn staffing to 64. Staff does not recommend lowering the department’s sworn staffing to less than 63. If two (2.00) Police Officers were eliminated, the Police Commander position would be backfilled at the rank of Police Officer upon elimination. 3a. Authorize Police Officer Over-Hire Funding – $88,816 Given the proposed staffing reductions in the Police Department, future vacancies created through retirement or resignation could have a more profound impact on service delivery and overtime costs. It is proposed that funding is included to authorize an over-hire of two positions for a period not to exceed six (6) months each. Over-hire funding would be used to fill an anticipated vacancy sooner and reduce any significant gap in staffing thereby making it easier to maintain actual staffing of 63 sworn personnel. This model essentially authorizes the department to exceed authorized staffing level for short periods of time for the sole purpose of replacing a known vacancy in a more expeditious manner, thus reducing the impact to service delivery. The budgeted cost to the General Fund is $88,816; however, the funds may not be fully expended in any given year. Note: This additional funding is directly tied to the elimination of Police Officer positions on a one-to-one basis and should not be considered otherwise. 4. Reduce/Eliminate Social Service Agreements – ($144,500) In many communities, social services are typically covered by the township, county or other social service agencies. The City funding social service programs has a long tradition in the community. During the FY2018 budget process, social service program funding was considered for reduction. Last year, Council approved a minimal reduction P a g e | 10 based on the non-performance of a particular entity that had been funded for several years. If so desired, Council could consider further reductions of social service funding. 5. Reduce/Eliminate DeKalb Chamber of Commerce Support – ($45,000) Annually, the City supports the Chamber of Commerce with $45,000 in funding, which covers the cost of a Chamber employee that coordinates special events in the community. This service used to be the responsibility of a City employee. Changing to this fee-based model allowed the City to still have special events throughout the City without maintaining the cost of employee compensation and benefits. The Council could, however, consider reducing or eliminating this funding for cost savings of up to $45,000 in the General Fund. 6. Reduce/Eliminate DeKalb County Economic Development Corporation (DCEDC) Support – ($45,000) The City also supports the DCEDC in the amount of $45,000 annually. The DCEDC plays a critical role in the administration of the County Enterprise Zone, which is an important economic development tool to prospective new businesses. The DCEDC also represents the City when the State forwards requests for proposals from businesses considering an Illinois location. The Council could, however, consider reducing or eliminating this funding for cost savings of up to $45,000 in the General Fund. 7. Reduce/Eliminate Local Athletic Sponsorships – ($17,500) For several years, the City has offered support in the form of a $12,500 sponsorship to Destination DeKalb, which brings the Illinois High School Association State High School Football Championships to DeKalb every other year. In addition, the Illinois Elementary School Association State Wrestling Tournament returns to DeKalb this year, and $5,000 has been budgeted to sponsor that event. Either or both sponsorships could be reduced or eliminated for a cost savings of up to $17,500 in the General Fund. 8. Transition Airport to Fixed-Base Operator Model – ($75,000) DeKalb Taylor Municipal Airport is fully operated by the City at present. The City could consider shifting to a Fixed-Base Operator (FBO) model whereby the City would grant to a private entity the right to operate the airport and provide services such as fueling, deicing, cargo handling, aircraft maintenance, flight instruction, and similar services. Under this model, the City would essentially lease the airport operations to the FBO and capture a percentage of fuel sales or some other revenue mechanisms. If this measure were enacted, it would require the elimination of the Airport Manager and Airport Line Service positions. Between the revenue generated through the FBO and the cost savings to the General Fund, the net gain would be $75,000. Previously Considered – More Information Requested: 1. Crime Free Housing, Code Compliance and Property Inspection Programs The City inspects residential and commercial properties through various inspection P a g e | 11 programs that were authorized by City Code at various points in time over the last 10 years based on concerns identified at a given point in time. In an attempt to be responsive to Council requests to do more with less and address serious building deficiencies, all inspection programs were reassigned to operate through the Community Development Department in 2017. At that time, the Fire Prevention Lieutenant was reassigned from the Fire Department to Community Development to perform Rooming House, Fire Life Safety and Commercial Building inspections under the supervision of a qualified Chief Building Official. Similarly, the Crime Free Housing Program, which was originally constructed to operate under the authority of the Police Department, was moved to Community Development because the program’s initial successes allowed previously dedicated full- time personnel to allocate time to other important initiatives like the supervision of a part- time property maintenance inspection personnel. Therefore, at the beginning of 2017, the Crime Free, Rooming House, Fire Life Safety, Commercial Building Inspection, and Property Maintenance Inspection Programs were reclassified as the Building & Code Compliance Division within the Community Development Department. This was done in order to take advantage of the knowledge and experience of the newly designated Chief Building Official position. Under the general direction of the Chief Building Official, this division would operate with one full-time Code Compliance Coordinator (formerly Crime Free Housing Coordinator), three part-time Code Compliance Inspectors (formerly Crime Free Housing Inspectors), and one Fire Prevention Lieutenant, a position mandated by IAFF union contract and technically reporting to FD. The goal, at that time, was to coordinate and manage all programs related to Crime Free, building safety and property maintenance under one department. Of these programs, Crime Free Housing and its associated code compliance activities have a dedicated revenue source, which is the Landlord Rental Registration fee. Projected revenue from this fee for FY2019 is $195,000. In addition to residential property inspections related to Crime Free, the City inspects residential and commercial properties as required by the Rooming House, Fire-Life Safety, Hotel-Motel and Gas Station codes. Several of these inspections require a fee to be paid and, in total, account for $46,500 in projected revenue for FY2018. In addition to these inspections, the Fire Department conducts commercial property inspections of those properties not covered under one of the preceding codes. These inspections are primarily conducted by on-duty Firefighters, with follow up inspections being conducted using a 7g overtime rate. The Fire Department also employs an Intern to assist with administrative tasks associated with commercial inspections. Commercial inspections have no dedicated revenue source as there is no fee associated with this program. In total, $241,500 in dedicated revenue sources can be attributed to the inspections detailed above. It is clear that these revenues are far exceeded by the expenditures related to these programs, both directly and indirectly. When this issue was last discussed on October 16, 2018, four options were discussed. At that time, the full scope and costs associated with these programs were underestimated. While revenues specifically tied to these programs are easily identifiable, the expenditure picture is not as clear. While the day-to-day activities of one employee or another may focus on a particular program, it is often the case that roles and responsibilities overlap on significant issues. For example, what begins as a code compliance case may take on additional complexities requiring the expertise of the Fire P a g e | 12 Prevention Lieutenant and/or Chief Building Official. This is one of the benefits of structuring these similar services under one department. It does, however, complicate the issue of tying specific revenue streams to specific activities. Crime Free Housing, Code Compliance and Inspection Programs Considerations: Staff conducted an additional review of the current Crime Free Housing program and City inspection programs. After consulting with the Fire Chief, Police Chief, Community Development Director, and City Attorney, there is some consensus that the move to consolidate Crime Free Housing and Fire Prevention into Community Development has been met by both positives and negatives. The services related specifically to code compliance and building inspections have improved over the past 18 months, with less than 12 of those months falling under the leadership of the Chief Building Official. There is, however, some concern that the Crime Free Housing program itself has suffered. At its core, Crime Free Housing is a crime prevention initiative with a mission more closely aligned with the Police Department than the Community Development Department. While the code compliance component contributes to the crime prevention mission of Crime Free Housing, it is best suited as a Community Development initiative separate from the law enforcement specific components of Crime Free Housing. Additionally, there is some concern from the Fire Chief regarding management and supervision of the Fire Prevention Lieutenant, who is budgeted for in the Fire Department budget but works day-to-day under Community Development. That said, several considerations exist as it relates to the future of these programs. 1. Should the City consider reestablishing the crime prevention component of Crime Free Housing in the Police Department? Doing so would require the addition of a part-time civilian employee (1,456 hours) at a cost of $45,763. This position, in theory, could maintain responsibility for leading landlord training seminars, analyzing calls for service to rental properties and maintaining relationships with landlords, addressing crime issues as needed. Additionally, staff believes that this position could support additional functions within the Police Department, such as assisting with the management of other crime prevention programs or initiatives. This further supports the Police Department’s ability to keep sworn staff dedicated to law enforcement specific functions. It is important to note that the property maintenance component associated with Crime Free Housing would remain in the Community Development Department. 2. If Crime Free Housing were to be reestablished in the Police Department as a stand- alone crime prevention program, what resources is the City willing to dedicate to the code compliance function of Community Development? While it may make sense to operate the basic premise of Crime Free Housing out of the Police Department, the same is not true of the code compliance/property maintenance inspection component of that program. That said, it has been well established that there is a clear need for a code compliance function within the City. That function is currently served by one full- time Code Compliance Coordinator and three part-time Code Compliance Inspectors. The Code Compliance Coordinator currently fulfills the Crime Free Housing functions described above. Therefore, moving Crime Free out of the Code Compliance Division reduces the responsibilities and workload of the Code Compliance Coordinator. P a g e | 13 2a. The City could consider eliminating the Code Compliance Coordinator position and realize a cost savings of $129,536 to the General Fund; however, by eliminating the Code Compliance Coordinator, the management and supervision of the three part- time Code Compliance Inspectors would fall under the Chief Building Official. The three part-time Code Compliance Inspectors serve the needs of Crime Free Housing related inspections as well as general property maintenance inspections of properties throughout the City. With only three part-time inspectors, each limited to 20 hours per week, resources are limited. Under the current model, the Code Compliance Coordinator accepts complaints via phone calls, e-mails or walk-ins, and assigns cases to Inspectors. The Inspector then dedicates their four-hour day, on average, to field inspections and paperwork associated with those cases, also making time available for court appearances when necessary. If there is no Coordinator to manage this workload, either the Inspectors’ day will incorporate the need to split between screening e-mails, phone calls, and walk-ins and actually spending time in the field investigating and documenting the cases or the Chief Building Official’s workload and duties would be realigned to incorporate these additional functions. Since the Inspectors are part-time, unlike a full-time, exempt Coordinator who is expected to perform duties as assigned, the Inspectors cannot be asked to work more hours without additional cost to the City. 2b. An alternative to the top-down reduction outlined in 2a would be to reduce expenditures from the bottom up. Doing so would require the elimination of one Code Compliance Inspector position. By eliminating this position, the City would realize a $27,201 savings to the General Fund. The service level impact of this elimination would include reduced inspection capacity and increased response time to property maintenance complaints. The elimination of a Code Compliance Inspector could offset the funding needed to reestablish Crime Free Housing under the Police Department. Under this model, the Code Compliance Coordinator would function as a working supervisor specifically dedicate to residential property inspection and code compliance activities. 3. Should additional revenues be established to fund property inspection programs? Two new revenue sources have been suggested as a potential means of reducing the funding gap tied to inspection services provided by the Fire Department under the authority of Community Development. Those revenues include a Vacant Building/Foreclosed Property Registration fee and a Commercial Building Inspection fee. Both revenues are in the early stages of evaluation, and, as such, conservative estimates are offered. • Vacant Building/Foreclosed Property Registration: The Chief Building Official provided data indicating there are 155 active foreclosed properties in the City and 124 potential foreclosures at present. Under the model proposed during the October 22 Regular City Council meeting, the City could realize $90,000 (80% of projection) annually from this registration fee. • Commercial Building Inspection: The Fire Chief provided information indicating there P a g e | 14  are 621 properties that would be eligible for the Commercial Building Inspection fee. Assuming a fee of $75 per eligible property, the City could realize an additional $46,575 in revenue annually. Note: There is a historical perceptive that is important to keep in mind when considering any new revenue tied to the City’s inspection program. In 2014, the City considered the implementation of Commercial Building Inspection fees. At that time, the business community was strongly opposed to the proposed fee and months of heated discussion ensued. Ultimately, the fee was not implemented. The primary consideration for City Council as it relates to these issues is to determine to what extent these services should be funded through dedicated revenue sources versus the existing revenue sources that fund general City services with no identifiable revenue source (i.e. police and fire protection). While there are budgetary considerations surrounding these issues, this is a policy consideration in the broader sense. Additional Considerations – Not Previously Discussed: 1. Reorganization of Police Department Civilian Support Staff - $50,000 As an alternative to reducing sworn staffing in the Police Department, the Police Chief would support a reduction in civilian support staff. The Police department currently employs five part-time Community Services Officers (CSOs) who function to support the department in various ways, including parking enforcement, evidence/property management, and non-critical patrol support. A vacancy currently exists among these five positions and it is proposed to be eliminated for a General Fund cost savings of $22,801. It would be up to the discretion of the Police Chief as to how the remaining CSOs would be allocated; however, he has indicated that the two CSOs recently dedicated to Central Business District parking enforcement would remain dedicated to those assignments. Additionally, the Police Chief supports further reorganization within the civilian ranks of the Police Department and believes total cost savings to the General Fund of $50,000 could be realized. Note: While the CSO position is an immediate reduction, further evaluation is needed before specifically identifying further reductions. 2. Eliminate One (1.00) Management Analyst – City Manager’s Office - $95,726 The City Manager’s Office employs two Management Analysts. Services provided across these two positions include supervision and management of Administrative Assistant and Management Interns, FOIA processing and compliance, overseeing the City’s mass communication efforts including website, social media, newsletters and press releases, assists with department budget development, act as staff liaison to various Commissions, oversee the City’s records retention and disposal process, and assists with project management across various City departments. Eliminating one Management Analyst from the City’s Manager’s Office would have a noticeable impact to service delivery. The roles and responsibilities of the two positions could, conceivably, be combined; however, the day-to-day responsibilities of the combined positions would likely consume all the time P a g e | 15 and resources of the remaining Management Analyst. The service delivery impact would be most notable to other City departments who rely on the Management Analysts for project management, analysis of data, generation and presentation of reports, policy research and development. The departments most impacted would be Community Development, Finance, and Human Resources. With this reduced staffing model, these departments would not have the benefit of seeking additional resources and support from the City Manager’s Office. The General Fund cost savings of this reduction would be $95,726. Note: If this expenditure reduction were preferred, it would be recommended that the previously discussed elimination of one Management Intern be reconsidered. V. Alternative Revenue Considerations The following list of budget-balancing measures includes those revenue items previously considered but not preferred by City Council. Following are alternative measures to consider aside from those already indicated as preferred by City Council: Previously Considered – Not Accepted: 1. Home Rule Sales Tax Increase - $3,000,000 at 0.75% or $1,000,000 at 0.25% increase. The City’s current home rule sales tax rate is 1.75% and is the largest source of revenue for the General Fund. This revenue is derived from the consumption of goods and services. Items that are not subject to this tax include groceries, medicine, ad licensed personal property such as automobiles. Comparable cities tax rate is between 1.75% and 2.75%. The City of Sycamore’s current rate is 1.75%. Potential impact of a tax rate increase: Positive effect: • An increase of 0.25% could result in an additional $1.0 million of revenue or 0.75% to result in the originally stated $3,000,000. • A small increase is unlikely to impact purchasing behavior, as DeKalb has retail stores that are unavailable elsewhere in the immediate area. Negative effect: • The City’s finances could become more volatile since this revenue is tied to the overall economic health of the City. • Being the largest source of revenue for the General Fund, the City’s overall tax structure would be less diverse which is contrary to an objective of the City’s Financial Policies. • The City would have a higher sales tax rate than surrounding communities. P a g e | 16  • As online sales increase, it is anticipated brick and mortar sales will decline. Note: Originally the 0.25% increase was calculated on the total sales tax. The statutory State Sales Tax is set by the State of Illinois. The Home Rule Sales tax is the portion of sales tax that the City Council can take action on. 2. Restaurant, Bar and Packaged Liquor Tax Increase – $480,000 The City’s current tax rate imposed upon prepared food items and alcoholic beverages available for immediate consumption, as well as the purchase of alcoholic liquor from retailers, is 2.00%. This is the same rate as in the City of Sycamore. If this tax were increased by 0.50%, the City could realize $480,000 in additional revenue. Potential impact of a tax rate increase: Positive effect: • An increase of 0.50% could result in an additional $480,000 of revenue. • Would meet several criteria established in the City’s Financial Policies for consideration of new revenues; these include: i. Would diversify the City’s revenues, because at present this tax makes up only 5.30% of all City revenues. ii. Tax has outgrown the Consumer Price Index (Inflation) by an average of 3.00% since its inception. iii. Tax meets several criteria for fairness; these reasons include: a. Visitors to the community (who use the City’s services) would pay the tax, as well as residents; b. Most people could avoid paying the tax if they desire to do so by not eating out; and c. Tax payments increase in accordance with taxpayers’ income to a greater extent than other taxes. • A small increase is unlikely to affect people’s purchasing behaviors, as a large portion of the restaurants and bars in the area are in DeKalb. Negative effect: • Much of the increased revenues would result from a limited number of consumer preferences (eating and drinking away from home), which some residents consider unfair. • In the past, some restaurant owners have objected to increasing this tax, stating that they were “singled out”, especially if they thought the increased revenues would not directly benefit them. P a g e | 17  • A small increase is likely to affect people’s purchasing behaviors, resulting in residents traveling to Sycamore. 3. Electric Utility Tax Increase – $87,500 The City imposes a tax on the privilege of using or consuming electricity. This tax is scaled upon the number of kilowatt hours consumed. In FY2017, $1.75 million was collected through this tax. The City of Sycamore does not impose this tax. A 5% increase in the electric utility tax rate would equate to $87,500 in additional revenue annually. Current breakdown as follows: • For the first 2,000 kilowatt-hours used or consumed in a month; 0.61 cents per kilowatt-hour; • For the next 48,000 kilowatt-hours used or consumed in a month; 0.40 cents per kilowatt-hour; • For the next 50,000 kilowatt-hours used or consumed in a month; 0.36 cents per kilowatt-hour; • for the next 400,000 kilowatt-hours used or consumed in a month; 0.35 cents per kilowatt-hour; • For the next 500,000 kilowatt-hours used or consumed in a month; 0.34 cents per kilowatt-hour; • For the next 2,000,000 kilowatt-hours used or consumed in a month; 0.32 cents per kilowatt-hour; • For the next 2,000,000 kilowatt-hours used or consumed in a month; 0.315 cents per kilowatt-hour; (10-28) • For the next 5,000,000 kilowatt-hours used or consumed in a month; 0.31 cents per kilowatt-hour; • For the next 10,000,000 kilowatt-hours used or consumed in a month; 0.305 cents per kilowatt-hour; and (10-28) • For all electricity used or consumed in excess of 20,000,000 kilowatt-hours in a month; 0.300 cents per kilowatt-hour Potential impact of a tax rate increase: Positive effect: • Tax can be raised in small incremental amounts to match the desired revenue goal. P a g e | 18 Negative effect: • Utility taxes are among the more regressive of the City’s taxes because they tax items that are less discretionary than many other taxes such as prepared food and beverages services and some general merchandise. 4. Gas Utility Tax Increase – $45,326 The City imposes a $0.04 per therm tax on the consumption of natural gas. In FY2017, the City realized $725,226 through this tax. If this tax were increased by $0.0025 to $0.0425, the City could realize $45,326 in additional revenue. The City of Sycamore does not impose this tax. Potential impact of a tax rate increase: Positive effect: • Tax can be raised in small incremental amounts to match the desired revenue goal. Negative effect: • Utility taxes are among the more regressive of the City’s taxes because they tax items that are less discretionary than many other taxes such as prepared food and beverages services and some general merchandise. 5. Increasing Video Gaming Terminal Renewal Fees - $21,500 The City imposes fees on businesses for the privilege of operating video gaming terminals in their establishments. Currently, businesses pay a $500 application fee and $250 annual renewal fee per terminal, with the exception of not-for-profit entities who only pay $25 per terminal. Earlier this year, staff surveyed comparable communities and found that annual terminal fees range anywhere between $25 and $1,000 per terminal. The City of Sycamore charges a fee of $100. There are currently 103 licensed terminals in the City, with 17 being operated by not-for-profits. If the City were to increase the annual fee from $250 to $500, an additional $21,500 in revenue could be realized. Potential impact of a tax rate increase: Positive effect: • Fee is relatively discretionary, so business can avoid them to some extent. • This tax would diversify the City’s revenues. • Tax can be raised in small incremental amounts to match the desired revenue goal. Negative effect: • Businesses would have an additional workload to pay the tax. • Could discourage businesses from having video gaming terminals, which may also be a positive depending on one’s preference for or against video gaming. P a g e | 19 6. Implementation of an Amusement/Entertainment Tax – To Be Determined Staff has initiated preliminary exploration of an Amusement/Entertainment Tax, the intent of which is to collect revenue from the sale of ticketing or admissions to various amusement or entertainment events hosted within the City. Examples could include movie theater tickets, live concerts and other shows at venues throughout the City. At this point, staff is not prepared to provide a revenue estimate for this type of tax; however, staff has undertaken the initial task of locating communities in the region assessing this type of tax. Staff has identified several municipalities with an Amusement or Entertainment Tax, including Rosemont, Schaumburg, Hoffman Estates, Evanston, Lombard, and St. Charles. Tax rates range from 3% to 10% of gross receipts. As a point of reference, the Village of Lombard is a similarly sized municipality collecting an Amusement Tax at a rate of 5%. Their annual revenue is approximately $560,000. At this point, staff would seek direction from Council on their preference for this type of tax and additional research could be conducted to better estimate potential revenue. V. Recommendation Based on updated revenue and expenditure projections, a $240,742 funding gap exists for FY19 as detailed in Attachment A. This remaining funding gap is that which resulted from the change in policy direction related to the 2018 Property Tax Levy, which was discussed on October 16. If the City Council were to reach consensus on additional budget-balancing measures, as identified herein, that eliminate the funding gap, the financial forecast would then align with the recommended Fund Balance Policy of 30% of expenditures less property tax revenue through FY21. Previously, funding this gap would have achieved the Fund Balance Policy through FY23; however, a miscalculation was made while forecasting Hotel/Motel Tax revenues early in the budget process, which was inadvertently forecast to increase by 102% as opposed to the actual 2% increase. The chart below shows the fund balance projection as it stands today. City Council is asked to reevaluate budget-balancing measures detailed within this P a g e | 20 memorandum, including those not previously offered for consideration. If service reductions resulting from expenditure-based budget-balancing measures do not meet the preferences of Council, additional consideration should be given to revenue options or Council could consider a lower threshold from the current Fund Balance Policy. Staff requests the City Council consider and provide direction on further budget-balancing measures to bring the FY2019 Annual Budget in line with the City’s General Fund Balance Policy. P a g e | 21  Attachment A City of DeKalb - 2018 Financial Forecast Summary of Financial Position: FY2017 Actual FY2018 Budget FY2018 Estimate FY2019 Projection FY2020 Projection FY2021 Projection FY2022 Projection FY2023 Projection Beginning Fund Balance 9,229,121 9,631,715 9,073,799 8,862,939 9,259,293 9,214,953 8,778,745 7,783,639 Revenues by Category Property Taxes 5,523,531 6,004,594 6,004,594 6,017,140 6,658,170 7,403,494 8,113,432 9,677,714 Sales & Use Taxes 15,238,719 15,666,105 15,576,289 15,947,894 16,390,884 16,795,476 17,211,017 17,637,843 Gross Receipts Taxes 3,643,995 3,752,614 3,680,239 3,712,208 3,745,122 3,778,984 3,813,801 3,849,578 Intergovernmental 4,805,946 4,962,973 4,750,370 5,087,724 5,143,599 5,200,163 5,257,428 5,315,401 Licenses & Permits 875,518 1,171,811 843,433 1,157,969 1,091,981 1,069,325 1,076,795 1,084,398 Service Charges 2,212,674 2,544,824 2,557,677 2,916,720 2,975,054 3,034,555 3,095,247 3,157,152 Fines 608,515 839,178 793,782 808,592 824,764 841,259 858,084 875,246 Other Income 1,218,294 1,350,550 1,274,856 1,311,200 1,318,133 1,325,644 1,331,664 762,537 Transfers In 1,588,852 1,377,205 2,076,597 1,120,829 1,009,468 898,274 787,251 595,937 Total Revenues 35,716,044 37,669,854 37,557,837 38,080,276 39,157,175 40,347,176 41,544,718 42,955,806 Expenditures by Category Personnel 28,106,457 30,176,366 29,751,460 30,271,747 31,744,572 33,326,440 35,082,882 37,043,336 Commodities 891,102 1,106,966 1,176,501 1,146,019 1,146,019 1,146,019 1,146,019 1,146,019 Contractual Services 2,329,132 2,019,388 2,760,535 2,458,121 2,502,889 2,502,889 2,502,889 2,502,889 Equipment 200,861 86,920 112,879 98,712 98,712 98,712 98,712 98,712 Other Services 2,297,664 2,106,502 1,855,500 1,867,500 1,867,500 1,867,500 1,867,500 1,867,500 Transfers Out 2,046,150 2,221,822 2,111,822 1,841,823 1,841,823 1,841,823 1,841,823 1,841,823 Total Expenditures 35,871,366 37,717,964 37,768,697 37,683,922 39,201,515 40,783,383 42,539,825 44,500,278 Ending Fund Balance 9,073,799 9,583,605 8,862,939 9,259,293 9,214,953 8,778,745 7,783,639 6,239,166 Minimum Amounts Required to Meet Financial Policies Unassigned Fund Balance at 25% of Expend 9,429,491 9,442,174 9,420,981 9,800,379 10,195,846 10,634,956 11,125,070 Variance to Target 154,114 (579,235) (161,687) (585,426) (1,417,101) (2,851,318) (4,885,903) 25.4% 23.5% 24.6% 23.5% 21.5% 18.3% 14.0% Unassigned Fund Balance at 30% of Expend 9,514,011 9,529,231 9,500,035 9,763,003 10,013,967 10,327,918 10,446,769 Variance to Target 69,594 (666,292) (240,742) (548,050) (1,235,222) (2,544,279) (4,207,603) 30.2% 27.9% 29.2% 28.3% 26.3% 22.6% 17.9% 1 Detail of 2018 Financial Forecast Revenues FY2017 Actual FY2018 Budget FY2018 Estimate FY2019 Projection FY2020 Projection FY2021 Projection FY2022 Projection FY2023 Projection Property Taxes 5,523,531 6,004,594 6,004,594 6,017,140 6,658,170 7,403,494 8,113,432 9,677,714 PROPERTY TAX - C 817,910 824,070 0 0 159,659 320,116 321,717 1,028,910 PROPERTY TAX - F 0 0 0 0 0 0 0 0 PROPERTY TAX - F 2,612,994 2,758,908 3,225,807 3,216,521 3,473,843 3,786,489 4,165,137 4,623,302 PROPERTY TAX - IM 71,962 0 0 0 0 0 0 0 PROPERTY TAX - P 2,020,666 2,421,616 2,778,787 2,800,619 3,024,669 3,296,889 3,626,578 4,025,501 Sales & Use Taxes 15,238,719 15,666,105 15,576,289 15,947,894 16,390,884 16,795,476 17,211,017 17,637,843 HOME RULE SALES 6,508,901 6,707,185 6,643,926 6,743,880 6,878,758 7,016,333 7,156,660 7,299,793 HOTEL/MOTEL TAX 275,007 290,000 282,000 346,100 403,022 411,082 419,304 427,690 LOCAL USE TAX 1,138,904 1,144,780 1,144,780 1,189,691 1,249,176 1,311,634 1,377,216 1,446,077 RESTAURANT & BA 1,966,938 2,043,668 2,016,111 2,066,514 2,118,177 2,171,131 2,225,410 2,281,045 STATUTORY SALES 5,348,970 5,480,472 5,489,472 5,601,709 5,741,752 5,885,295 6,032,428 6,183,238 Fines 608,515 839,178 793,782 808,592 824,764 841,259 858,084 875,246 ABATEMENT FINES 0 5,000 2,350 5,100 5,202 5,306 5,412 5,520 ADMINISTRATIVE T 139,540 225,000 180,498 196,348 200,275 204,280 208,366 212,533 CIRCUIT COURT FI 299,554 325,000 311,000 317,220 323,564 330,036 336,636 343,369 CRIME FREE HOUS 145 0 0 0 0 0 0 0 DUI FINES 29,882 55,000 40,000 40,800 41,616 42,448 43,297 44,163 FALSE FIRE ALARM 4,100 2,500 4,500 29,682 30,276 30,881 31,499 32,129 MAIL-IN FINES 50,150 60,000 60,000 61,200 62,424 63,672 64,946 66,245 OTHER FINES 24,600 28,000 56,424 28,560 29,131 29,714 30,308 30,914 PARKING TICKETS 58,944 136,478 136,210 127,438 129,987 132,586 135,238 137,943 TOW FINES 1,600 2,200 2,800 2,244 2,289 2,335 2,381 2,429 Gross Receipts Taxes 3,643,995 3,752,614 3,680,239 3,712,208 3,745,122 3,778,984 3,813,801 3,849,578 FRANCHISE TAX 499,384 498,000 499,384 506,875 514,478 522,195 530,028 537,979 MUNICIPAL UTILITY 2,472,309 2,517,019 2,517,019 2,554,774 2,593,096 2,631,992 2,671,472 2,711,544 TELECOMMUNICAT 672,303 737,595 663,836 650,559 637,548 624,797 612,301 600,055 Intergovernmental 4,805,946 4,962,973 4,750,370 5,087,724 5,143,599 5,200,163 5,257,428 5,315,401 FEDERAL GRANTS 16,425 200,000 38,490 0 0 0 0 0 FEDERAL PASS TH 45,102 0 17,113 17,113 17,113 17,113 17,113 17,113 FIRE GRANTS 11,654 130,000 40,000 0 0 0 0 0 OTHER SHARED R 165,358 162,100 168,169 169,010 169,855 170,704 171,558 172,416 PERSONAL PROP R 173,727 137,188 150,721 140,434 143,243 146,108 149,030 152,010 POLICE GRANTS 8,500 0 12,500 0 0 0 0 0 STATE INCOME TA 4,044,119 3,940,685 3,918,670 4,347,082 4,390,553 4,434,458 4,478,803 4,523,591 TOWNSHIP ROAD & 143,356 148,000 145,123 148,621 151,350 154,129 156,960 159,842 VIDEO GAMING TA 197,706 245,000 245,000 250,880 256,901 263,067 269,380 275,845 Licenses & Permits 875,518 1,171,811 843,433 1,157,969 1,091,981 1,069,325 1,076,795 1,084,398 AMUSEMENT LICE 4,350 4,600 3,058 3,119 3,182 3,245 3,310 3,376 BUILDING PERMITS 161,178 450,000 250,500 561,049 485,784 458,799 460,033 461,275 ELECTRIC PERMIT 34,582 68,598 0 0 0 0 0 0 FIRE LIFE SAFETY 20,950 22,000 22,650 22,440 22,889 23,347 23,814 24,290 HVAC PERMITS 83,618 32,927 0 0 0 0 0 0 LIQUOR LICENSES 242,123 247,200 247,200 252,144 257,187 262,331 267,577 272,929 OTHER LICENSES 46,685 75,000 76,166 75,000 75,000 75,000 75,000 75,000 OTHER PERMITS 17,475 21,951 27,159 27,159 30,517 28,808 28,886 28,965 PARKING PERMITS 1,770 3,800 3,800 3,800 3,800 3,800 3,800 3,800 PLUMBING PERMIT 76,927 29,085 0 0 0 0 0 0 2  RENTAL CRIME FR 167,750 195,000 195,000 195,000 195,000 195,000 195,000 195,000 ROOMING HOUSE 15,200 17,900 17,900 18,258 18,623 18,996 19,376 19,763 SEWER PERMITS 2,910 3,750 0 0 0 0 0 0 Service Charges 2,212,674 2,544,824 2,557,677 2,916,720 2,975,054 3,034,555 3,095,247 3,157,152 ADMINSTRATION F 137,508 136,400 136,400 139,128 141,911 144,749 147,644 150,597 AMBULANCE SERV 1,023,981 1,272,424 1,272,424 1,618,872 1,651,249 1,684,274 1,717,960 1,752,319 FINGER PRINT FEE 2,107 0 1,100 0 0 0 0 0 FIRE SERVICES 949,828 1,004,000 1,004,000 1,024,080 1,044,562 1,065,453 1,086,762 1,108,497 FUEL SALES 76,393 105,000 105,000 107,100 109,242 111,427 113,655 115,928 HOTEL INSPECTIO 5,100 5,000 2,500 5,100 5,202 5,306 5,412 5,520 POLICE SERVICES 6,832 10,000 19,928 10,200 10,404 10,612 10,824 11,041 ZONING FEES 10,925 12,000 14,325 12,240 12,485 12,734 12,989 13,249 Other Income 1,218,294 1,350,550 1,274,856 1,311,200 1,318,133 1,325,644 1,331,664 762,537 ANTI-CRIME ACTIV 8,192 35,000 26,051 19,921 20,319 20,726 21,140 21,563 CRIME LAB 16,660 15,000 16,371 16,699 17,033 17,374 17,721 18,075 DONATIONS 20,000 5,000 5,000 5,100 5,202 5,306 5,412 5,520 INVESTMENT INTE 102,079 85,000 162,372 120,600 121,203 121,809 122,418 123,030 MISCELLANEOUS I 39,163 50,000 34,500 105,845 107,962 110,121 112,324 114,570 MISCELLANEOUS T 19,150 21,350 21,350 21,777 22,213 22,657 23,110 23,572 POLICE FORFEITU 32,644 35,000 15,003 35,700 36,414 37,142 37,885 38,643 REFUNDS / REIMBU 358,380 388,200 388,200 385,764 393,479 401,349 409,376 417,563 SALES OF ASSETS 5,100 130,000 362 0 0 0 0 0 TIF PROPERTY TAX 251,286 236,000 252,219 255,153 257,998 260,762 262,525 0 TIF SALES TAX SUR 365,640 350,000 353,428 344,642 336,310 328,399 319,752 0 Transfers In 1,588,852 1,377,205 2,076,597 1,120,829 1,009,468 898,274 787,251 595,937 TRANSFER FROM HEALTH INS FUN 0 450,000 0 0 0 0 0 TRANSFER FROM C 209,181 0 0 0 0 0 0 0 TRANSFER FROM C 25,326 82,298 82,298 84,355 86,464 88,626 90,842 93,113 TRANSFER FROM 104,000 124,000 124,000 124,000 124,000 124,000 124,000 124,000 TRANSFER FROM 0 9,482 9,482 9,719 9,962 10,211 10,466 10,728 TRANSFER FROM S 500 500 500 500 500 500 500 500 TRANSFER FROM S 500 500 500 500 500 500 500 500 TRANSFER FROM S 500 500 500 500 500 500 500 500 TRANSFER FROM S 500 500 500 500 500 500 500 500 TRANSFER FROM T 678,576 678,576 678,576 558,954 439,332 319,710 200,087 0 TRANSFER FROM T 113,198 113,198 113,198 0 0 0 0 0 TRANSFER FROM T 10,570 57,251 57,251 20,000 20,000 20,000 20,000 20,000 TRANSFER FROM W 316,000 310,400 310,400 321,800 327,709 333,727 339,856 346,096 Total Revenues 35,716,044 37,669,854 37,557,837 38,080,276 39,157,175 40,347,176 41,544,718 42,955,806 Expenditures FY2017 Actual FY2018 Budget FY2018 Estimate FY2019 Projection FY2020 Projection FY2021 Projection FY2022 Projection FY2023 Projection Personnel 28,106,457 30,176,366 29,751,460 30,271,747 31,744,572 33,326,440 35,082,882 37,043,336 REGULAR WAGES 15,102,363 15,492,241 15,344,359 15,630,701 16,177,776 16,743,998 17,330,038 17,936,589 PART-TIME WAGES 687,579 796,981 699,398 676,727 700,412 724,927 750,299 776,560 OVERTIME 1,134,032 1,243,111 1,217,207 1,235,776 1,279,028 1,323,794 1,370,127 1,418,081 POLICE/FIRE PENS 5,451,569 6,450,564 6,450,564 6,582,771 7,109,393 7,749,238 8,524,162 9,461,820 LONGEVITY 134,439 143,216 132,588 143,031 144,461 145,906 147,365 148,839 IMRF 693,010 755,547 674,677 558,742 569,917 581,315 592,941 604,800 FICA 533,175 598,555 542,382 560,718 625,953 647,726 670,259 693,580 HEALTH INSURANC 3,707,726 4,031,702 4,031,702 4,252,488 4,507,637 4,778,096 5,064,781 5,368,668 CAR ALLOWANCE 22,037 23,080 16,812 19,652 19,896 20,142 20,392 20,645 EDUCATION BONU 4,500 5,000 5,125 5,125 5,000 5,000 5,000 5,000 3  WELLNESS BONUS 5,250 8,000 5,700 7,500 5,400 5,400 5,400 5,400 WORKERS COMPE 512,375 512,375 512,375 512,375 512,375 512,375 512,375 512,375 Commodities 891,102 1,106,966 1,176,501 1,146,019 1,146,019 1,146,019 1,146,019 1,146,019 ACTIVITIES SUPPL 1,186 1,600 1,200 800 800 800 800 800 AMBULANCE SUPP 24,298 42,000 34,198 34,300 34,300 34,300 34,300 34,300 ANTI-CRIME ACTIV 0 8,000 8,000 8,000 8,000 8,000 8,000 8,000 BOARDS & COMMIS 4,090 11,435 11,435 8,735 8,735 8,735 8,735 8,735 BUILDING MECH SY 16,147 21,000 72,610 68,950 68,950 68,950 68,950 68,950 BUILDING SUPPLIE 10,016 11,568 15,529 30,568 30,568 30,568 30,568 30,568 COMMODITIES 6,742 6,184 1,184 1,184 1,184 1,184 1,184 1,184 CRIME LAB EXPEN 3,196 4,150 4,150 4,150 4,150 4,150 4,150 4,150 DUI FINES EXPEND 660 10,634 10,634 10,634 10,634 10,634 10,634 10,634 FIREFIGHTING SUP 41,709 37,450 35,278 41,850 41,850 41,850 41,850 41,850 INSPECTOR SUPPL 113,668 62,473 62,473 62,473 62,473 62,473 62,473 62,473 INVESTIGATIONS S 13,165 8,445 9,143 8,445 8,445 8,445 8,445 8,445 JANITORIAL SUPPL 17,848 17,000 15,930 16,300 16,300 16,300 16,300 16,300 LAB SUPPLY AND M 0 600 6,160 5,684 5,684 5,684 5,684 5,684 OFFICE SUPPLY 18,823 24,311 24,501 22,051 22,051 22,051 22,051 22,051 OIL GAS & ANTIFRE 231,071 271,449 283,494 278,758 278,758 278,758 278,758 278,758 POLICE FORFEITU 25,575 14,545 14,545 14,545 14,545 14,545 14,545 14,545 PRINTED MATERIA 49,470 54,819 54,527 51,423 51,423 51,423 51,423 51,423 SMALL TOOLS & EQ 10,562 12,839 10,975 10,050 10,050 10,050 10,050 10,050 SNOW & ICE CONT 3,733 120,500 120,500 120,500 120,500 120,500 120,500 120,500 STORMWATER SYS 15,681 17,500 15,000 17,500 17,500 17,500 17,500 17,500 STREET/ALLEY MA 26,436 30,500 30,500 30,500 30,500 30,500 30,500 30,500 STREETLIGHTS, PA 7,793 17,000 17,000 17,000 17,000 17,000 17,000 17,000 TECHNOLOGY SUP 43,697 33,675 43,200 18,800 18,800 18,800 18,800 18,800 TRAFFIC & STREET 20,805 20,000 27,500 20,000 20,000 20,000 20,000 20,000 TRAFFIC SIGNALS, 13,520 34,000 34,000 34,000 34,000 34,000 34,000 34,000 VEHICLE MAINTEN 140,033 177,728 179,567 177,728 177,728 177,728 177,728 177,728 WEARING APPARE 31,177 35,561 33,268 31,091 31,091 31,091 31,091 31,091 Contractual Services 2,329,132 2,019,388 2,760,535 2,458,121 2,502,889 2,502,889 2,502,889 2,502,889 ARCHITECT / ENGI 134,463 17,500 165,000 128,000 128,000 128,000 128,000 128,000 BUILDING MECH SY 28,614 39,700 0 0 0 0 0 0 BUILDINGS - MAINT 30,701 27,750 72,610 68,950 68,950 68,950 68,950 68,950 CONTRACTUAL SE 693,718 334,586 991,828 778,053 822,821 822,821 822,821 822,821 DEVELOPMENTAL 140,000 140,000 140,000 130,200 130,200 130,200 130,200 130,200 DUES & SUBSCRIP 54,275 58,540 55,961 33,031 33,031 33,031 33,031 33,031 EDUCATION TUITIO 25,910 46,100 30,500 0 0 0 0 0 ELECTRICITY 31,920 59,794 100,000 80,000 80,000 80,000 80,000 80,000 EQUIPMENT - MAIN 45,437 53,642 58,147 55,700 55,700 55,700 55,700 55,700 FINANCIAL & MGMT 37,530 36,948 31,948 32,688 32,688 32,688 32,688 32,688 FORESTRY 42,346 57,000 55,000 57,000 57,000 57,000 57,000 57,000 FREIGHT & POSTA 24,209 25,437 25,958 26,272 26,272 26,272 26,272 26,272 HUMAN & SOCIAL S 151,500 144,500 144,500 144,500 144,500 144,500 144,500 144,500 INTERGOVT'L SERV 6,302 6,600 0 0 0 0 0 0 KISHWAUKEE RIVE 9,340 12,340 0 0 0 0 0 0 LANDSCAPE&GRO 24,098 27,500 32,500 27,500 27,500 27,500 27,500 27,500 LEGAL EXPENSES 15,715 19,880 16,280 25,180 25,180 25,180 25,180 25,180 LEGAL SERVICES 185,854 196,070 196,130 196,070 196,070 196,070 196,070 196,070 MARKETING ADS & 19,132 19,025 19,800 15,610 15,610 15,610 15,610 15,610 4  MOSQUITO ABATE 8,089 6,000 6,000 6,000 6,000 6,000 6,000 6,000 NUISANCE ABATEM 23,646 1,000 6,000 15,000 15,000 15,000 15,000 15,000 PERSONNEL RECR 31,667 36,275 36,275 55,480 55,480 55,480 55,480 55,480 PSYCH & MEDICAL 36,648 36,108 26,500 31,120 31,120 31,120 31,120 31,120 RENTAL, EQPT & F 250 1,400 1,250 1,400 1,400 1,400 1,400 1,400 SIDEWALKS - MAIN 942 1,500 1,500 1,500 1,500 1,500 1,500 1,500 SNOW & ICE CONT 18,020 45,000 45,000 45,000 45,000 45,000 45,000 45,000 SPECIAL EVENTS 19,957 19,800 16,400 7,250 7,250 7,250 7,250 7,250 STREETS/ALLEYS - 5,025 9,000 9,000 9,000 9,000 9,000 9,000 9,000 TAXES, LICENSES, 13,113 11,500 11,500 11,500 11,500 11,500 11,500 11,500 TOWING 4,515 5,780 5,780 5,780 5,780 5,780 5,780 5,780 TRAFFIC SIGNALS 4,413 15,000 0 0 0 0 0 0 TRAINING, EDUC, & 137,515 216,808 192,977 191,487 191,487 191,487 191,487 191,487 UNEMPLOYMENT I 32,338 7,300 0 0 0 0 0 0 UTILITIES 7,853 14,938 10,500 15,720 15,720 15,720 15,720 15,720 VEHICLES - MAINT 100,429 128,649 118,877 125,124 125,124 125,124 125,124 125,124 WARNING SIRENS 6,480 6,600 6,480 6,600 6,600 6,600 6,600 6,600 WEATHER SERVIC 3,120 3,649 3,500 3,649 3,649 3,649 3,649 3,649 Equipment 200,861 86,920 112,879 98,712 98,712 98,712 98,712 98,712 MACHINERY & MAJ 15,133 21,818 21,818 21,818 21,818 21,818 21,818 21,818 OFFICE FURNITUR 8,964 7,444 7,586 3,058 3,058 3,058 3,058 3,058 OTHER EQUIPMEN 129,798 0 0 0 0 0 0 0 TECHNOLOGY EQU 28,370 43,200 33,675 26,960 26,960 26,960 26,960 26,960 TELEPHONE & RAD 12,064 14,458 49,800 46,876 46,876 46,876 46,876 46,876 VEHICLES 6,531 0 0 0 0 0 0 0 Other Services 2,297,664 2,106,502 1,855,500 1,867,500 1,867,500 1,867,500 1,867,500 1,867,500 CONTINGENCIES 32,995 52,500 52,500 64,500 64,500 64,500 64,500 64,500 CONTRACTED SER 468,755 496,002 0 0 0 0 0 0 SURETY BONDS & 64,163 70,000 70,000 70,000 70,000 70,000 70,000 70,000 TAX SHARING AGR 1,731,750 1,488,000 1,733,000 1,733,000 1,733,000 1,733,000 1,733,000 1,733,000 Transfers Out 2,046,150 2,221,822 2,111,822 1,841,823 1,841,823 1,841,823 1,841,823 1,841,823 TRSF TO CAPITAL 0 410,000 300,000 20,000 20,000 20,000 20,000 20,000 TRSF TO CAPITAL 196,108 0 0 0 0 0 0 0 TRSF TO FLEET FU 81,674 0 0 0 0 0 0 0 TRSF TO GENERAL 1,756,998 1,801,827 1,801,827 1,801,827 1,801,827 1,801,827 1,801,827 1,801,827 TRSF TO TRANSPO 11,370 9,995 9,995 19,996 19,996 19,996 19,996 19,996 Total Expenditures 35,871,366 37,717,964 37,768,697 37,683,922 39,201,515 40,783,383 42,539,825 44,500,278 5