Wilmette Park District
Financial Planning & Policy Committee
Monday, August 25, 2014
6:30 p.m. – Park District Administration Office
Commissioners/Committee: Chair Olvany, Benz, Brault
Commissioners: Crowley, Abbott
Staff: Eppelheimer, Bingham, Lambrecht, Donoghue, Felicicchia
I. Meeting Called to Order
Meeting called to order 6:30 p.m.
II. Approval of Minutes
A. Commissioner Olvany moved to approve the minutes from July 29, 2014 as amended, on Page 2-3, Paragraph 5, Sentence 2 will read ...to ask for $15 million. Sentence 4 will read, Discussion ensued that Committee agreed with $14.5 million, seconded by Brault; all voted yes, the motion carried.
III. Communication and Correspondence
IV. Recognition of Visitors
Beth Beucher, 1420 Sheridan Road, Wilmette
V. Old Business
A. Non-Tax Revenue, Advertising on WPD Property – Deferred
VI. New Business
A. 2014 Tax Levy Direction Discussion
Superintendent Eppelheimer discussed the memo and spreadsheet. The proposed increase in the tax levy for Tax Cap Funds is 1.5%, which is equal to CPI-U from 2013 and could account for some growth in the new property. There will probably be a cap on the special recreation fund again this year. The percentage increase shown under resolution would be 1.31% which would not require a special tax increase notice or a public hearing. The taxes levied in 2014 become due and payable in two installments on March 1 and August 1, 2015.
Commissioner Olvany asked about Column 4, Fund Balance. Superintendent Eppelheimer stated the column marked policy target % is what the fund balance policy calls for as a minimum. Commissioner Brault gave a historical perspective on the fund balance and policy formation. He stated that three years ago the fund balance amounts were about double. After that if you go back a dozen years where the fund balance amounts were essentially zero. As the Community Recreation Center renovations were wrapped up, it appeared that expenses were being funded off the credit cards. As soon as the renovation was complete there was a significant movement to build fund balances to give the District an operating cushion. About five or six years ago we starting looking at the level of balances that we had. Stress testing was done for several years to see what impacts would be on fund balance if revenues went down between 5%-20% and if expenses held steady. The results showed that even under the most likely scenario we would have a sufficient cushion to be at about half the current funding levels. The consensus view of the Board was we were holding tax payers money without any real need given how stable the operations were and how efficient staff was at managing the expenses. Therefore, it was decided that we could employ the fund balances that we were holding into the projects that were on the five year plan, Golf Master Plan, Centennial Ice and Platform Tennis, and not have to seek additional outside funding.
Commissioner Olvany commented on the fund being without a target this year. Superintendent Eppelheimer stated that the one that has been negative was capital but everything else was getting back into alignment.
Superintendent Eppelheimer asked the Committee if they were okay with proposed the taxes aggregate, capped at 1.5%, to review refinancing options with BMO Capital. He stated that the tax levy is set up with referendum approved debt and debt service extension base. The tax levy for the Debt Service Fund will drop by about $620,000. Commissioner Olvany stated that we have some interest savings opportunities by restructuring our debt. The question is when the debt becomes due. Superintendent Eppelheimer stated that it will probably be 2016 debt pulled into 2015 timeframe. The Committee agreed to move forward with BMO to work out some scenarios.
Commissioner Brault asked Superintendent Eppelheimer to add a column on his memo in regards to 2014 Tax Levy Direction Discussion to reflect the 2% added by the County for loss and costs so the estimated tax levy would reflect the 2% increase. Superintendent Eppelheimer stated that what is presented is required by state statute but will add a column to show Committee what the levy may look like after all the calculations are completed. History shows that not all the 2% is added.
B. 2015 Uniform Budget Increases – Interactive Spreadsheet of Revenue & Expenses
Superintendent Eppelheimer walked the Committee through the very preliminary 2015 Annual Budget spreadsheet. He stated the revenues in the projections are down across all categories except Program Fee Revenue. Staff recommended an overall fee increase of 3.5%. However, there will be a general increase in daily fees as a result of Golf being available for the entire 2015 season. Fee Revenue, as Superintendent Bingham’s explained, is doing very well.
Superintendent Eppelheimer discussed expenses stating that the health insurance benefits are going to climb. Retirement funding will remain flat. Utilities, particularly natural gas, were going to climb in price, although not reflected in the year to date or projections as we have some credits coming in with new facilities coming on and overestimations earlier in the year. A new contract was issued for natural gas with an 18% increase.
Commissioner Olvany asked to play with the numbers to see what the changes could be with the big expenses. He wanted to see salaries and wages at 4%. Superintendent Bingham commented that increases of 1.5% to 2% have been difficult to retain or reward better employees. She stated that there is very little opportunity to reward people who are excelling and doing really well because that window is so small. She stated that even if we had a larger pool, that did not mean everyone employee will get that increase. Superintendent Eppelheimer stated other increases are related to the CPI-U and that the District continues to spend money in other areas, such as capital. He stated that last year was a tough sell when it was 2% or less.
Commissioner Olvany commented on the full time and part time staff. He stated that since there was so much demand for part time jobs last year the District was able to play with the numbers and give more to the full time. He would like to get numbers from staff on what the hiring season was like this year. Is there still a demand for part time? Superintendent Bingham stated that there are two different scenarios; one being the seasonal employees which is a huge amount of people who are interested in these positions. The other is year round part time people, who the District depends on heavily for operating programs. The number of full time people is stable with the cost in health care benefits, staff looks at other ways to fill vacated full-time positions. Commissioner Olvany asked staff to gather historical information relative to inflation, wages and salary. Superintendent Eppelheimer suggested doing this sooner rather than later for staff to prepare for the budget process. Commissioner Olvany suggested emailing to move this process along. Superintendent Eppelheimer will discuss with Director Wilson.
Commissioner Brault also asked about the net revenue numbers with the after school programs taking place and what it looks like. Commissioner Olvany asked about the line item of daily fees. The Committee agreed this number is low and it should be reverted back to 2013 numbers. Staff will provide additional insight and suggested emailing to move this process along also through Director Wilson.
C. Surplus Property Ordinance 2014-O-5
Superintendent Eppelheimer discussed Ordinance 2014-O-5 requesting the Committee to recommend to the full Board disposal of surplus property. This ordinance is to declare the wood chipper at Parks surplus personal property and allowing disposal to Vermeer-Illinois. Maintenance discovered stress cracks in the exhaust chute and frame of the shipper itself. There was discussion on the safety of the old equipment, but Superintendent Lambrecht commented that the equipment is traded “as is.” The equipment is usually used for parts or scrapped.
Commissioner Olvany moved and Commissioner Benz seconded a motion to recommend to the full Board approving Ordinance 2014-O-5, AN ORDINANCE AUTHORIZING AND PROVIDING FOR THE DISPOSAL OF SURPLUS PROPERTY OF THE WILMETTE PARK DISTRICT, COOK COUNTY, ILLINOIS. All agreed.
VII. Next Meeting
The next meeting is scheduled for September 29, 2014.
There being no further business to conduct, the meeting was adjourned at 7:57 p.m.