Finance, Taxes and Insurance

FINANCE COMMITTEE June 11, 2012 - Official 5:00 p.m. Members Present: Brian Lauer, Ron Kluth, Rick Albee, Gil Amborn, Cindy Gauger Also Present: Rebecca Ewald, Lori Peternell, and Kelly Krause Lauer called the meeting to order at 5:00 p.m. May 14, 2012 minutes were not included in the packet; the consensus of the Committee was to table the approval of minutes until July 9, 2012. Discussion was held regarding vehicle insurance. Ewald stated that the Village currently insures it’s vehicles through the League of Wisconsin Municipal Mutual Insurance (LWMMI) and has the choice of insuring vehicles based upon the original cost or agreed upon value. The Village also has the option of insuring the vehicles through the Local Government Property Insurance Fund (LGPIF) that provides replacement of a like vehicle. For the last decade the Village has insured its vehicle based upon an agreed value with LWMMI. Discussion was held regarding what the premium difference would be if insured at the original cost and the agreed upon value. Ewald will contact insurer to provide the costs and report back to the Committee. Discussion was held regarding the deductibles on the vehicles. Lauer suggested a higher deductible for higher cost vehicles, such as anything over $100,000. Amborn suggested leaving deductible at $2500 for all vehicles since the premium amount between $2500 and $5000 is approximately $1500. Consensus of the Committee was to keep the deductible at $2500. Discussion was held on No-fault sewer backup insurance. Ewald stated that the Village currently does not have this coverage. Ewald stated that coverage would be if the Village was found to be negligent in maintaining the system. Amborn stated that it’s important to have a regular maintenance program in place and to properly document all inspections and repairs to show that the Village is maintaining the system properly. Amborn stated that if this is being done then he doesn’t see a need for the insurance. The Committee reviewed and discussed the (2) claims that have been submitted to the Village in 2005 and 2007. The Committee felt that the system is being maintained properly and documentation is in place to support that; therefore; it was the consensus of the Committee that there isn’t a need for no-fault sewer backup insurance. Motion made by Amborn, seconded by Gauger to recommend to the Village Board not to proceed with no-fault sewer backup coverage. Motion carried unanimously. Discussion was held regarding the Village of Waterford pension plan. The Committee discussed the two funds, the ING International Value Portfolio and the ING Balanced Portfolio that are underperforming in accordance with the Village of Waterford’s investment policy statement. At the May meeting the Finance Committee made a motion to remove the underperforming funds that are on the watch list from the pension plan and have Lauer and Amborn review the suggested replacement funds. Upon their review, they recommended that the ING International Value be replaced with the Artisan International Value and the ING Balanced Fund be replaced with the JP Morgan Diversified Fund. Motion made by Kluth, seconded by Amborn to replace the ING International Value with the Artisan International Value and the ING Balanced Fund to be replaced with the JP Morgan Diversified Fund. Motion carried unanimously. Discussion was held regarding adding funds to the Village of Waterford pension plan. Lauer stated that he reviewed the available funds that could be added to the program and felt that the portfolio could be restructured to offer a more diversified plan to the employees. Kluth stated that the Board is in the process of reviewing WRS and would be making a decision in July or August. It was the consensus of the Committee to wait until the Board makes a decision on WRS before adding any funds to the plan. The Finance Committee will review this again in September. Discussion was held regarding allocation of general fund balance. Peternell stated that the Administrator has been working with the Board to discuss a number of projects that are currently on the list for the Village Administrator. Due to the large number and short staff, the Board reviewed each item to prioritize project as high, medium or low attention. Specific recommendations including outside assistance, were made that may help the Administrator in executing the tasks. Any outside assistance is not included in the current year budget; therefore, staff is recommending that General Fund Balance be considered to fund the projects. The Committee reviewed the list of short and long term project goals. At this time, costs have either not been finalized or are unknown. When costs are available, staff will bring the proposals to the Village Board for review and action. Peternell discussed the Fund Balance Policy that was approved by the Village Board in 2011 to implement GASB 54 which relates to how fund balance is reported in the financial statements. The 2011 audit has been completed and this is the first year that the financial statements reflect the Village’s fund balance policy. The total General Fund balance is $2,042,196; of which approximately $679,913 that can be allocated toward the short and long term projects. Motion made by Gauger, seconded by Albee to recommend to the Village Board approval of Village prepaid invoices in the amount of $28,654.53. Motion carried unanimously. Motion made by Kluth, seconded by Amborn, to recommend to the Village Board approval of Village unpaid invoices in the amount of $136,683.56. Motion carried unanimously. Motion made by Albee, seconded by Kluth, to recommend to the Village Board approval of Water & Sewer invoices in the amount of $93,993.50. Motion carried unanimously. Upon motion made by Gauger, seconded by Albee, the meeting adjourned at 6:30 p.m. Submitted by, Lori Peternell Village Treasurer 2