Village of Lombard Legistar System

Village Manager David Hulseberg gave an overview and powerpoint presentation

regarding the proposed FY 2009 - FY 2010 Village of Lombard Operating Budget.

Manager Hulseberg reported the FY 2010 budget proposes that $2,147,510 of utility tax

dollars be used for capital improvements; $2,813,000 of utility tax dollars be used to

reserve a 25% General Fund balance as outlined in the Village's Financial Policies and

projects a Utility Tax Reserve balance of $3,211,376 at the end of FY 2010. Mr.

Hulseberg reviewed the multi-year financial forecast. He reminded the Village Board

and Finance Committee members not to get caught up in the numbers two to three

years from now.

Brad Janisch questioned the difference in the capital improvement numbers.

Manager Hulseberg stated the difference is due to the Village scaling back on projects

because of budget shortfalls and not wanting to dip into reserve funds. He indicated

they can relook at these areas again in the future.

Finance Director Sexton indicated there has been a consistent scaling back on the

amount of utility tax going to capital projects.

President Mueller stated the Village had submitted a list of projects totalling $31 million

to legislators requesting any financial assistance that could be given to the Village.

Manager Hulseberg continued his presentation and reported the total General Fund in

the 2009 amended budget is $37,853,100 compared to the proposed 2010 which is

$37,364,180 and the FY 2009 Corporate General Fund is $31,310,320 compared to FY

2010 proposed $31,185,620.

Manager Hulseberg highlighted the 2009-2010 General Fund Expenditures as follows:

* Rebating an additional $68,240 of Business District Tax to Yorktown Center;

* Decrease in Training and Travel expenses by $73,810;

* Decrease in rebate of $22,740 of Sales Tax, Places for Eating Tax, and

Hotel/Motel Tax to the Lombard Public Facilities Corporation;

* Decrease in the transfer to the Technology Reserve by $201,770;

* Decrease in the contingency by $78,450;

* Continuation of the Senior Taxi Subsidy Program ($60,000);

* Maintain Village's contribution to the DuPage Senior Citizen Council ($30,000);

* Continue to work with IT consultants (Year 3) to meet technology needs and

demands of Village's operations ($298,460);

* Partially fund the Technology Reserve ($380,000) with two anticipated costs in

the near future estimated at $500,000 (replacement of current iSeries service

and purchase of a records software program for the Police Department.

Mr. Hulseberg noted there will be no out-of-sate travel by staff.

Trustee Tross questioned the decrease in the Hotel/Motel Fund.

Manager Hulseberg indicated this was due to a decrease in the Westin's decrease in

occupancy.

A discussion was held concerning the Taxi Subsidy Program.

Questions and comments were made regarding limiting the area subsidized; offer

coupons based on need; program needs to identify medical need; eliminate trips out of

Village limits; confirm Village residency before issuing coupons.

Finance Director Sexton indicated the coupons have a one-year expiration date.

Trustee Soderstrom questioned the taxi rides to the airports.

President Mueller indicated there may be some abuse of the Taxi Program. He asked

about verifying residency before issuing coupons.

Trustee Moreau asked if there could be an audit.

Trustee Fitzpatrick inquired if there could be an annual review and report.

Manager Hulseberg indicated the program will be reviewed and recommendations will

come to the Village Board. He advised that the info received from the cab drivers will

also be reviewed.

Finance Director Sexton stated the Village may look at issuing an ID to residents with a

one or two year expiration. There will be a simplified form given to cab drivers to make

tracking data easier.

Trustee Tross commented about reducing the program expenditure, limiting the rides to

in-town only like they used to be, eliminating O'Hare and Midway trips. He felt the

program can offer an opportunity to hoard coupon books. He commented about

seniors who have vehicles and drive and those who live at Beacon Hill and Lexington

and have shuttle serve available to them. He indicated there were a lot of seniors who

were empty-nesters and do not drive and he did not want to take away from them. He

also commented about a medical need versus a trip to the grocery store.

Finance Director Sexton indicated written documentation is necessary for medical

need.

President Mueller indicated he had heard of a former Lombard resident living at Mays

Lake and obtaining Lombard taxi passes. He did not want to fund residents in other

towns using coupons.

Trustee Fitzpatrick suggested an annual report that shows the usage. She also

commented about a possible decrease in use once the circulator bus became available.

President Mueller felt the circulator would not be available until the fall.

Trustee O'Brien indicated that was a different type of service and the taxi was a direct

service to the doctor or wherever the senior was going.

Manager Hulseberg indicated there was an analysis problem. He stated it appeared

that 33% of the taxi rides were to the airport and some 5-6% were to casinos.

Trustee Tross questioned who was using the coupons and asked if seniors with cars or

living at Beacon Hill or Lexington were using the coupons. He stated both Beacon Hill

and Lexington have shuttle bus service.

Finance Director Sexton indicated the Village will look at former residents no longer

living in Lombard to determine if they are still receiving taxi coupons. He stated the

form given to the taxi drivers will be simplified with yes and no answers and will help

track the trips.

Trustee Fitzpatrick questioned the DuPage Senior Citizens Council and how the money

is used.

President Mueller stated the money helps with the Meals on Wheels Program and the

Home Maintenance Program.

Village Manager Hulseberg continued with 2009-2010 General Fund Expenditures

Recommendations as follows:

* Technology enhancement and replacements (multi-functional printer/plotter

$10,000 from Tech Reserve plus additional $11,000; wireless communications

for Police laptops - $25,200; and three Verathon Ranger video laryngoscopes

- $29,100);

* Include a contingency amount of $548,250;

* Fund repairs and improvements to Village buildings (Village Hall - $23,650;

Police Building - $20,500; Fire Stations - $30,700 and Public Works Building

- $12,000);

* Continuation of RedLight Photo Enforcement Program ($13,000), with

expenses projected to be recovered from fine revenue;

* Fund a disaster drill ($20,000);

* Purchase Emergency Vehicle Pre-Emption equipment ($10,400);

* Continuation of the Rain Barrel Grant Program through the Village's Recycling

Program ($5,000).

Trustee Gron questioned if there is a report showing how much money is collected by

other villages using the Red Light Program.

Manager Hulseberg indicated revenue is not the only reason the Village is using the

Red Light Program. The program is to make intersections safer and reduce accidents.

The reduction of accidents will decrease expenses in the Police and Fire Departments.

President Mueller noted some communities have noticed a 40% reduction in accidents

with the Red Light Program.

Manager Hulseberg stated the compost bin program was still open.

Manager Hulseberg continued with General Fund Revenues and listed the following

reasons for changes:

* Increase in Utility Tax of $1,060,000;

* Increase in Circuit Court Fines of $84,240;

* Increase in Parking Fines of $46,680;

* Decrease in Sales Tax of $1,350,000;

* Decrease in State Income Tax of $62,100;

* Decrease in Places for Eating Tax of $335,990;

* Increase in Ambulance Billing fees of $150,090;

* Decrease in Building Permit and Plan Review Fees of $168,680;

* Decrease in Interest Income of $190,640.

Manager Hulseberg noted that the Places for Eating Tax is consistently going down.

Manger Hulseberg reviewed the General Fund multi-year financial forecast. He

indicated the Village wanted to hold the fund reserve balances at 25%. He stated the

market is very volatile and staff will be keeping an eye on it. He noted staff will be

watching sales tax and adjust the budget accordingly.

Manager Hulseberg reviewed the Water and Sewer Operating and Maintenance

Expenditures. He noted the FY 2010 expenditures were projected at $12,623,750

which is an increase of $578,660 (480%) compared to the FY 2009 budget. He

reported an increase of $450,790 (25.02%) in the cost of purchasing Lake Michigan

Water due to a projected increase in the rate charged by the DuPage Water

Commission from $1.24 per 1,000 gallons to $1.47 effective May 1, 2009 and then an

additional increase to $1.72 effective May 1, 2010 and a total estimated payment of

$3,154,290 to the Glenbard Wastewater Authority which is an increase of $52,550

(2.02%).

Trustee O'Brien questioned the increase in Lake Michigan Water.

Trustee Tross questioned if the increase was set.

President Mueller stated the City of Chicago had not raised rates in many years and the

increase was to help balance their budget. He noted the rate increase will help offset

improvements that all Lake Michigan Water customers have to pay for. He noted that

the Village received an increase last June and the City of Chicago will not pass on the

increase until October. The rate is set for three years - 15% each year (2010, 2011 and

2012).

Trustee O'Brien felt residents would voice their displeasure if rates were raised.

Manger Hulseberg reported that water consumption has decreased also. He stated

staff looked at residential and commercial water usage and that usage had decreased

in all areas.

Manager Hulseberg continued with the Water and Sewer Operating and Maintenance

Fund expenditures:

* Third year funding for a cross-connection control program as required by

federal law ($63,600) with approximately 60% of this cost expected to be

recovered in revenue;

* Increase of $60,000 (40%) in the cost of electricity;

* Increase of $60,210 (26.50%) for IMRF pension costs;

* Cost of $90,000 for the large meter testing program;

* Funding for a grease control program ($22,200);

* Contingency amount of $62,670.

Manager Hulseberg indicated the revenue for the Water and Sewer Operating and

Maintenance Fund is estimated at $12,604,930 which is based on selling 1.313 billion

gallons of water and the billing of 1.250 billion gallons for sewer. He reported this is an

increase of $592,795 (4.93% compared with the FY 2009 amended budget. He stated

as part of adopting its FY 2008 budget, the DuPage Water Commission rebated $40

million from its unrestricted balance to its customers. The Village of Lombard received

$2.22 million. In FY 2008, the Village used $188,160 of this rebate to fully offset an

increase in both the water service charge and the water and sewer rate for operations.

In FY 2009, the Village used $324,765 of this rebate to partially offset the water and

sewer rate for operations. In FY 2010, it is proposed that $630,000 of the remaining

rebate be used to partially offset the rate increase for FY 2010. There is a $.30

(4.48%)increase in the bi-monthly service charge from $6.70 to $7.00 proposed which

covers the cost of water billing and collection, and meter reading and maintenance.

There is a water and sewer increase of $.60 for operations and maintenance proposed.

No increase in the capital rate is proposed, as committed to in the 2006 non-home rule

sales tax referendum. If approved, the water and sewer rate for operations would

increase from $6.81 to $7.41 per 1,000 gallons, while the capital rate would remain

unchanged at $1.20 per 1,000 gallons. The combined total water and sewer rate for

operating and capital purposes would increase from $8.01 to $8.61 per 1,000 gallons

(7.49%). The proposed water service charge and rate increase would increase the cost

to the average residential customer using 8,000 gallons bi-monthly by $30.60 annually,

or $5.10 bi-monthly.

Village Manager Hulseberg reported on three scenarios. He favored Scenario One. He

noted there was no increase shown in year four for Lake Michigan Water.

Trustee Tross reminded the Board of the decision in 1982 or 1984 not to wean people

to the water increase when the Lake Michigan Water came. He felt the Water and

Sewer Fund should be self-sufficient and it should be a "pay-as-you-go" program. He

stated Lombard was one of only a few communities that subsidizes water.

President Mueller felt there would be regular increases from Chicago.

Trustee Moreau suggested communication with residents.

Manager Hulseberg suggested holding the rate at 7%.

Manager Hulseberg continued with an overview of the Hotel/Motel Tax Reserve as

follows:

* Revenue for FY 2010 is projected at $2,041,130, a decrease of $183,020

(-8.23%) from the FY 2009 budgeted revenue;

* Included as part of the FY 2010 projected revenue is $827,510 in Hotel/Motel

Tax from the Westin. The tax revenue will be paid to the Village and thereafter

rebated back to the Lombard Public Facilities Corporation as part of a Tax

Rebate Agreement;

* The Hotel/Motel Tax from the Westin is excluded, and projected revenue for

FY 2010 is $1,213,620, which represents a decrease of $211,880 (17.46%) from

the FY 2009 budgeted revenue.

Manager Hulseberg gave an overview on the Hotel/Motel Tax Expenditures as follows:

* Expenditures for FY 2010 are proposed at $2,241,090, an increase of $32,490

(1.47%) over FY 2009 budgeted expenditures;

* When the Hotel/Motel Tax rebate to the Westin is excluded, projected

expenditures for FY 2010 are $1,413,580, an increase of $3,030 (0.21%) over

FY 2009 budgeted expenditures;

* The proposed revenue and expenditure levels will result in a decrease in the

fund balance from $602,718 at the end of FY 2009 to $402,758 at the end of FY

2010, or 30.88% of budgeted expenditures when the Hotel/Motel Tax rebate to

the Westin is excluded.

Manager Hulseberg indicated the following items are proposed to be funded with the

Hotel/Motel Tax revenue:

* Total of $76,720 for the Lilac Parade and related activities;

* Total of $111,190 for the Taste of Lombard which includes a $35,000 grant to

the Lombard Jaycees;

* Total of $44,220 for costs associated with Cruise Nights;

* Consultant and other costs $44,360) associated with the Village's website

which includes a proposed cost of $18,050 for maintenance and streaming

video of Village meetings to the web site;

* $30,000 for the third year of a proposed five-year program to replace the

Village's banners and flags.

Manager Hulseberg stated that reserve dollars previously had been put into the Westin,

but this has changed.

Trustee Soderstrom questioned the Taste of Lombard expenditures.

Trustee Tross stated the Taste will be open five days this year - Wednesday through

Sunday. He stated they do not have a chair at this time, but he knew they would have

community night on Wednesday, be open all day Thursday, Friday and Saturday and

close at 6 pm on Sunday. He stated the 3rd and 4th will be the biggest days and

Senior Appreciation Day will be Sunday.

Finance Director Sexton stated the actual expenditures for the Taste is the same and

did not increase.

Ed Murphy questioned if the amount should be decreased due to the economy.

Trustee Tross remarked that last year the Jaycees wanted a large fireworks display as

it was their 25th anniversary.

President Mueller reminded the Board that the Village pays for the shuttle bus service

to and from the Taste.

Manager Hulseberg stated he could get an hourly rate based on police and fire hours.

Trustee Tross reminded the Board that Hotel/Motel tax money is used for tourism.

Trustee Soderstrom suggested partnering with other community groups in an attempt to

get better entertainment. He noted the Taste brings in over 100,000 people. He

agreed planting trees is great, but does not bring people to the Village spending money.

Trustee Tross questioned if the Village makes any money on the Taste. He noted that

the Jaycees do not keep any money they make and give it to at least 34 community

organizations. Trustee Tross recommended advising the Jaycess that the $35,00 grant

was not $35,000 just for fireworks. He indicated the Jaycees budget for entertainment

is $97,000.

President Mueller stated it was up to the Jaycees. He noted that Naperville funds

$100,000 and that they charge a fee to get into their Taste as does Lisle.

Brad Janisch noted that he would like to see Hotel/Motel Tax Funds used more to

promote tourism in the Village.

Trustee Tross noted that the Jaycees have a lot of components for each aspect of the

Taste including the fireworks committee, the gaming committee, food and beverage

committee and then sub-committees from there. He wanted to convey to the Jaycees

that the $35,00 grant was not exclusively for fireworks.

President Mueller stated that the entertainment contracts are difficult and the

entertainers stay overnight and want certain water and specific other requests which

add up in price.

Trustee Tross felt there should be an expansion of the arts and crafts and more family

entertainment such as the Little People.

President Mueller suggested this go to committee.

Trustee Soderstrom stated there are a lot of things funded through Hotel/Motel and

some that do not have a great benefit to the Village. He felt that as we go forward, the

Village will need to be more creative with spending. He suggested partnering with other

community organizations.

President Mueller felt the number of days would not change the dollar amount that

much. He referenced the expensive signs, the fencing and the police wages.

Trustee Soderstrom noted it was the third year for the banner replacement program.

He questioned the Village meetings on the website.

Manager Hulseberg continued with items proposed to be funded with Hotel/Motel Tax

revenue:

* Decrease in funding for tree planting from $70,000 to $55,000;

* Implementation of a Circulator Grant at $150,000;

* Implementation of a Park District Grant for the Aquatic Center at $13,000;

* Discontinuation of the Hotel Cooperative Grant Program;

* $81,600 for dues payments to the DuPage Convention and Visitors Bureau

which is based upon projected hotel/motel tax revenue for FY 2010;

* $122,960 for the Historical Museum and Peck Hours;

* $22,500 for repairs, improvements and maintenance of the Main Street

Cemetery;

* Continued funding of the Police Holiday Patrol (BA MPP) at $15,000;

* Continued funding of the Elmhurst Symphony Orchestra Concert Series at

$20,000 for concert to be held at Glenbard East High School.

Trustee Tross commented about the $50,000 beautification program including $6,000

for lilac bushes that you have to be a resident to receive.

Manager Hulseberg reviewed the Hotel/Motel Tax multi-year financial forecast. He

noted the following other issues:

* Village working with Library on an Agreement to limit the Village's future costs

for Library IMRF and FICA costs;

* Several scheduled FY 2010 vehicle purchases have been postponed until

FY 2011;

* All out-of-state travel eliminated from FY 2010 budget;

* FY 2010 budget proposed to fill the Police Lieutenant position and Firefighter

position that are currently frozen in FY 2009. In addition, currently have one

Police Officer and one Fire Battalion Chief position frozen which will remain

frozen through FY 2010;

* Current proposed budget anticipates no change in how the state distributes

state-collected revenues such as income tax.

Trustee Tross questioned if Central Garage Reserve Fund would be impacted by the

vehicle purchase delays.

Finance Director Sexton indicated these purchase were not squad cars or fire trucks.

Manager Hulseberg stated it would not be impacted.

Manager Hulseberg noted the Aquatic Center funding included free passes to be

distributed to hotel guests.

Trustee Soderstrom questioned Chief Seagraves regarding leaving the chief position

frozen and not the firefighter.

Chief Seagraves noted that hiring the firefighter would help keep the minimum staffing

up. He stated the Chief positions was administrative and earlier it had been vacant for

two years.

Trustee Tross questioned if leaving the one firefighter position open, might qualify the

Village for federal money.

Manager Hulseberg stated he had not seen any type of project being funded through

this type of stimulus package.

Village Manager Hulseberg continued with other issues in 2009 to 2010 and beyond as

follows;

* Concerns about future DuComm costs for two reasons:

DuComm is considering a change to the funding formula; and

DuComm's proposed FY 2010 budget includes adding 10 new positions,

funded by one-time transfers;

* Two issues regarding Glenbard Wastewater Authority:

Glen Ellyn has been charging GWWA a non-resident rate (1.5 times the

resident rate); and

Glen Ellyn appears to be charging an excessive overhead fee as the lead

agency for GWWA;

* Village is facing significant increases in pension costs due to the significant

decline in the stock market which includes IMRF, police pension and fire

pension costs.

Trustee O'Brien thought that some of the DuComm positions may be duplicated.

Manager Hulseberg noted the employee count had increased.

Trustee Moreau questioned if vehicle costs were low, if it would be a good time to

purchase.

Manager Hulseberg indicated this was a public relations issue and a good decision with

public relations effect. He also noted he is working with the Village of Glen Ellyn

regarding the GWWA charges and they will be again meeting about this in the near

future.

Manager Hulseberg continued with other issues 2009-2010 and beyond as follows:

* Firefighter pension enhancement was passed the last day of the 95th General

Assembly, which, if signed by the Governor, will allow a firefighter to purchase

up to two years of service credit in military service;

* In FY 2009, an additional police officer became eligible to receive free health

insurance under the Public Safety Employee Benefits Act (PSEBA), bringing

the Village's total to five. One additional disability application is pending

with the Police Pension Fund;

* The increase in water costs from the DuPage Water Commission is the result

of increases by the City of Chicago. Chicago has only outlined increases

through FY 2012. After that, the multi-year forecast assumes a 3% inflationary

increase in the cost of water each year.

Trustee Tross questioned if there was any indication of an exemption for the pension

portion to maintain the Village at 80%.

Manager Hulseberg stated the legislators had agreed to no more sweeteners in the

area, but yet they all voted in favor of this bill.

Trustee Fitzpatrick questioned what we had the lobbyist working on for the Village.

Manager Hulseberg stated the lobbyist was asked to focus on the capital improvement

bill. He stated surrounding communities collaborate on Mondays to discuss what

issues their lobbyist will be working on as far as a specific bill.

Trustee Tross questioned if there was any indication of lifting the pension portion.

Manager Hulseberg stated there were seven legislators at the last DuPage Mayors and

Managers Conference meeting. They are working on redefining "catastrophic".

President Mueller stated nothing will be touched on the property tax cap.

Manager Hulseberg stated the key project was the capital bill along with the sales tax

issue for the Westin.

President Mueller stated there was no money in capital funding for all of Route 53.

Finance Director Sexton stated the corporate part of the levy goes away in two years.

Brad Janisch spoke as a resident and member of the Finance Committee. He stated

he thought the budget was fantastic, but wanted to see the Village maximizing its

benefits from use of the Hotel/Motel funds. He suggested partnering with other groups

for the Taste of Lombard and other events and working at getting more traffic into

Yorktown.

Finance Director Sexton indicated the proposed budget was to go the Finance

Committee in two weeks.