Finance, Taxes and Insurance

FINANCE COMMITTEE November 9, 2015 – Official 5:00 p.m. Members Present: Gil Amborn, Brian Lauer, Tom Roanhouse and Jim Schneider Excused: Ron Kluth Also Present: Rebecca Ewald, Lori Peternell, Stephanie Charapata, Mary Beth Mikrut, and Michael McNair Lauer called the meeting to order at 5:00p.m. Motion made by Schneider, seconded by Amborn to approve the October 12, 2015 Regular Meeting Minutes. Motion carried. Motion made by Schneider, seconded by Roanhouse to approve the October 20, 2015 Joint Finance and Village Board Meeting Minutes. Motion carried. Motion made by Schneider, seconded by Amborn to approve the October 26, 2015 Joint Finance and Village Board Meeting Minutes. Motion carried. Motion made by Schneider, seconded by Roanhouse to recommend Village Board approve Absolutely Waterford’s funding request, not to exceed $600.00, for police services during River’s Edge Art Walk, Winter Wonderland Parade & Pooch Parade. Motion carried. Motion made by Amborn, seconded by Kluth to recommend Village Board approval of the letter of engagement with Johnson Block for audit services for 2015. Motion carried. Discussion was held regarding the purchase requisition for the sprinkler system at Station #2. Schneider asked if the Village could ask for a variance from the State that would exempt the requirement of installing a sprinkler system. Motion made by Schneider, seconded by Roanhouse to table the requisition and agreement for Station No. 2 sprinkling system until more information on the International Building Code regarding sprinkling systems and the Villages ability to appeal the Code. Motion carried. Motion made by Schneider, seconded by Roanhouse to recommend Village Board approve the financial advisory agreement for borrowing from Hutchinson, Shockey, Erley & Co. (HSE) with the provision that we request HSE amend their agreement to be governed by, subject and construed in accordance with the laws of Wisconsin instead of Illinois. Motion carried. Discussion was held regarding the non-recurring policy. Schneider recommended that the Treasurer report on the funds allocated to each category of the policy. After lengthy discussion it was the consensus of the Committee that the policy needs to be reviewed and input be provided from department heads on the best way to plan for future expenses. The Committee would also desire to review alternates on how to fund capital items in 2016. The policy will be reviewed in January 2016. Motion made by Amborn, seconded by Schneider to include the 2016 non-recurring budget requests in the proposed 2016 budget. Motion carried. Discussion was held regarding the 2016 proposed budget. The Budget hearing for the 2016 budget is scheduled for November 23, 2015. At the 11/4 Joint Finance and Village Board meeting the Board approved a levy of $2,900,847 to be allocated as follows: - General Fund levy: $1,798,205 - Capital Fund levy: $258,770 - Library Fund levy: $284,084 - Recycling Fund levy: $65,660 - Village Debt Service Fund levy: $491,127 Motion made by Amborn, seconded by Schneider to recommend Village Board approval of the budget on November 23, 2015 following the public hearing. Motion carried. Discussion was held regarding the Sewer equipment replacement fund (ERF) account policy. The Sewer utility is required to have a sewer equipment replacement fund (ERF) in order to property operate and maintain the facilities, including maintaining adequate funding. This is also a requirement for a municipality that receives a Clean Water Fund. The sewer utility has a replacement account that has been in place for many years; however, with the transition of the Utilities administration the account has not been reviewed or updated in recent years. With the upcoming borrowing that will include utility projects, the DPW Director and Treasurer have been working on updating the replacement schedule and developing a policy in accordance with DNR requirements. Currently there is $398,730 in the replacement account. Based on the replacement schedule there is a deficit of $9,226. A transfer will be made by year end to get the account in compliance. Motion made by Amborn, seconded by Schneider to recommend Village Board approve the Sewer equipment replacement fund (ERF) account policy. Motion carried. Discussion was held regarding the Water depreciation account policy. In 2010 the Water Utility authorized refunding of $1,100,000 revenue bonds. As a requirement of the borrowing, the utility is required to have a depreciation account that is equal to the least of: - 10% of the proceeds of the Bonds, - maximum annual debt service on the Bonds in any Bond Year, and - 125% of average annual debt service on the Bonds. Based on this requirement, the depreciation account needs to have a minimum balance of $110,000 (10% of the proceeds of the Bonds) and has a current balance of $186,795.48. As part of the annual audit, the auditor calculates the amount required. The Director has created a replacement schedule similar to the sewer equipment replacement fund. Because the only requirement of the water depreciation account is to have adequate funds to cover debt we will be asking for assistance from the auditor on drafting a policy to include Operation and Maintenance Expenses which are defined as the reasonable and necessary costs of operating, maintaining, administering and repairing the System, including salaries, wages, cost of materials and supplies, insurance and audits. The draft policy will be coming for review in early 2016. Motion made by Schneider, seconded by Amborn, to recommend to the Village Board approval of Village prepaid invoices in the amount of $267,573.87. Motion carried. Motion made by Schneider, seconded by Amborn to recommend to the Village Board approval of Village unpaid invoices in the amount of $250,599.22. Motion carried. Upon motion made by Schneider, seconded by Roanhouse, the meeting adjourned at 6:29 p.m. Motion carried. Submitted by, Lori Peternell, CMTW Village Treasurer 2