City of Sycamore City Council met Nov. 18.
Here is the agenda provided by the council:
1. CALL TO ORDER
2. INVOCATION
3. PLEDGE OF ALLEGIANCE
Lead by North Grove Elementary Girl Scout Troop 907 Students.
4. APPROVAL OF AGENDA
5. AUDIENCE TO VISITORS
6. CONSENT AGENDA
A. Approval of the Minutes for the Regular City Council Meeting of November 4, 2019.
B. Plan Commission Minutes from September 9, 2019.
C. Payment of the Bills for November 18, 2019.
7. PRESENTATION OF PETITIONS, COMMUNICATIONS, AND BILLS
A. Presentation of Community Economic Development Planning Grant from the DeKalb County Community Foundation.
8. REPORTS OF OFFICERS
9. REPORTS OF STANDING COMMITTEES
10. PUBLIC HEARINGS—None
11. ORDINANCES
A. Ordinance 2019.32—An Ordinance Approving a Request by Greg LeSage, President of Tech Weld Inc., for a Special Use Permit to Operate a Welding and Welding Equipment Use, as Required by Article 5.3.1.E of the Sycamore Unified Development Ordinance, at 805 Thornwood Drive in the City of Sycamore, Illinois (PIN number 09-06-426-014). First and Second Reading.
Tech-Weld Inc. is a full-service custom manufacturer of precision welded tubes, tanks, cones and weldments. The family-owned and operated business started in 1992 and has tripled in size over the past twenty-five years. Given the continued growth, the company is looking to relocate to a 32,147 square-foot building at 805 Thornwood Drive in the Sycamore Prairie Business Park. Tech-Weld has a contract to purchase the M-1, Light Manufacturing zoned property which formerly housed Smart Motion Robotics.
According to the City’s Unified Development Ordinance (UDO), Welding and Welding Equipment Uses require a Special Use Permit within M-1 zoning. Greg LeSage, the founder and President of Tech-Weld has submitted a petition for a special use permit that would enable his company to relocate to Sycamore.
Per Section 4.3.3 of the City’s Unified Development Ordinance, a Special Use Permit shall be granted only if evidence is presented to establish that:
A. The proposed structure or use at the particular location requested is necessary or desirable to provide a service or a facility which is in the interest of the public and will contribute to the general welfare of the neighborhood or community;
B. The proposed structure or use will not have a substantial adverse effect upon the adjacent property, the character of the neighborhood, traffic conditions, utility facilities and other matters affecting the public health, safety, and general welfare; and
C. The proposed structure or use will be designed, arranged, and operated so as to permit the development and use of neighboring property in accordance with the applicable district regulations.
Tech-Weld serves many industries including Aerospace, Aircraft, Automotive, Agricultural, Defense/Government, Motor Housing, Petrochemical, Food Processing and Water/Air Treatment. A significant portion of the work that Tech-Weld performs is tungsten inert gas (TIG) welding, an arc welding process that uses a non-consumable tungsten electrode to produce the weld. The process is not overly noisy and will be contained within the pre-cast building at the proposed location.
In mid-October, representatives of the City of Sycamore, the DeKalb County Economic Development Corporation, the Sycamore Prairie Industrial Park and the Sycamore School District visited Tech-Weld at their current location in Elburn. The visit provided an opportunity to learn more about the company, meet the family behind the business and view the operations. It is evident that the company takes pride in the products it makes and the image it portrays within the community. The multi-generational family business displays characteristics that align with those within the business park and the community.
A public hearing regarding the Special Use Permit was held at the Planning and Zoning Commission meeting on November 11th and a favorable recommendation was made to the City Council by a vote of 9 to 0.
City Council approval is recommended.
B. Ordinance 2019.33—An Ordinance Approving Amendments to Article 1.3, Definitions, to include Definitions for the Regulation and Sale of Recreational Cannabis – Adult Use and Modifications to Article 5.2, Conditions of Use and Article 5.3, Permitted Uses of the Unified Development Ordinance of the City of Sycamore, Illinois. First and Second Reading.
The State of Illinois has enacted the Cannabis Regulation and Tax Act, which pertains to the possession, use, cultivation, transportation and dispensing of adult-use cannabis. The City of Sycamore has the authority to adopt ordinances and to promulgate rules and regulations that protect the public health, safety and welfare of its citizens. The City Council voted on November 4th to permit adult-use recreational cannabis dispensaries beginning January 1, 2020. The adult-use recreational cannabis dispensaries shall operate consistent with zoning ordinances regulating these business establishments, including rules governing the time, place, manner and number of cannabis business establishments, and minimum distance limitations between cannabis business establishments and locations the City deems sensitive through a special use process. The appropriate zoning ordinances, rules and definitions shall be promulgated in the City’s Unified Development Ordinance (UDO) effective January 1, 2020.
Staff has prepared amendments to Article 1.3, “Definitions,” Article 5.2, “Conditions of Use,” and Article 5.3, “Table of Permitted Uses,” of the UDO as a starting point to create the necessary zoning regulations for adult-use recreational cannabis. The proposed guidelines factor regulations discussed by the Planning and Zoning Commission and City Council in 2014 for medical cannabis and provisions of the Illinois Cannabis Regulation and Tax Act.
Article 1.3, Definitions (add new definition):
Cannabis, Recreational – Retail Dispensing Organization (Adult Use): A facility operated by an organization or business that is licensed by the Illinois Department of Financial and Professional Regulation to acquire cannabis from licensed cannabis business establishments for the purpose of selling or dispensing cannabis, cannabis-infused products, cannabis seeds, paraphernalia or related supplies to purchasers or to qualified registered medical cannabis patients and caregivers, per the Cannabis Regulation and Tax Act, (P.A.101-0027), as it may be amended from time-to-time, and regulations promulgated thereunder.
Article 5.2, Conditions of Use (create new section)
A new section is proposed in Article 5.2, “Conditions of Use,” to outline certain criteria related to adult use recreational cannabis operations within the City of Sycamore as follows:
F. All uses involving the sale or dispensing of adult use recreational cannabis shall be subject to the following additional conditions:
1. Dispensaries must be a minimum of 1,000 feet from the property line in all directions of any pre- existing public or private preschool or elementary or secondary school or daycare center, daycare home, group daycare home, part day childcare facility and cannot be in an area zoned residential. A 250-foot setback to residential-zoned property is required.
2. On-premises cannabis consumption within any district is prohibited.
3. Craft-growers, or any other dispensary or retail location other than those defined under the “Cannabis, Recreational – Retail Dispensing Organization (Adult Use)” definition in Article 1.3 are prohibited.
4. A minimum separation of 1,500 feet between cannabis dispensaries is required.
5. No drive-thru dispensaries are allowed.
6. Business hours are limited to 6:00 a.m. to 10:00 p.m. for dispensaries per State law.
7. A maximum of one (1) dispensary shall be permitted for every 9,000 in population. A three- fourths (3/4) vote of the Corporate Authorities shall be required to waive the population proration to accommodate an additional dispensary.
8. No dispensary shall operate before January 1, 2020.
Article 5.3, Table of Permitted Uses
The table of permitted uses will be amended to outline and differentiate medical and adult-use cannabis dispensaries and calls for both to require a special use permit within C-3, Highway Business Zoning.
The Special Use Permit process requires that petitioners demonstrate that the use is consistent with the criteria outlined Section 4.3.3 of the UDO and a public hearing is held.
A public hearing regarding the proposed amendments to the Unified Development Ordinance was held at the Planning and Zoning Commission meeting on November 11th and a favorable recommendation was made to the City Council by a vote of 9 to 0.
City Council approval is recommended.
C. Ordinance 2019.34—An Ordinance Approving a Request by Andrew Christensen on Behalf of Pet IQ, for a Special Use Permit to Operate a Veterinary Clinic as Required by Article 5.3.1.A of the Unified Development Ordinance at 541 Puri Parkway, Unit C in the City of Sycamore, Illinois (PIN number 06-31-330-011). First and Second Reading.
PetIQ provides pet health and wellness products and veterinary services to pet families through retail channels across the country. The veterinary arm of the business provides services at retail centers and is called VetIQ. Services provided include vaccines, minor illness treatments, prescriptions, nail trims, retail pet health & wellness products, and microchipping. No major surgeries, boarding, kenneling or overnight stays are planned.
The company plans to lease a 764 square-foot tenant space (Unit C) to operate VetIQ within the Meijer store at 541 Puri Parkway. According to the City’s Unified Development Ordinance, a Veterinary Clinic requires a special use to operate within C-3, Highway Business District Zoning.
VetIQ will have an entrance and exit that is separate from Meijer, therefore pets will not have access to the retail store at any time.
Per Section 4.3.3 of the City’s Unified Development Ordinance, a Special Use Permit shall be granted only if evidence is presented to establish that:
A. The proposed structure or use at the particular location requested is necessary or desirable to provide a service or a facility which is in the interest of the public and will contribute to the general welfare of the neighborhood or community;
B. The proposed structure or use will not have a substantial adverse effect upon the adjacent property, the character of the neighborhood, traffic conditions, utility facilities and other matters affecting the public health, safety, and general welfare; and
C. The proposed structure or use will be designed, arranged, and operated so as to permit the development and use of neighboring property in accordance with the applicable district regulations.
Given that VetIQ will have a separate entrance and exit, the proposed use within the Meijer store is consistent with traditional multi-tenant strip centers. These types of arrangements are commonly found within the commercial zoning of the proposed location.
A public hearing regarding the Special Use Permit was held at the Planning and Zoning Commission meeting on November 11th and a favorable recommendation was forwarded by a vote of 9 to 0.
City Council approval is recommended.
D. Ordinance 2019.35—An Ordinance Providing for the Transfer of Land from the City of Sycamore to the Illinois Department of Transportation. First and Second Reading.
As part of the Sycamore Park District’s Action 2020 initiative the Great Western trail system will be connected from the Sycamore Forest Preserve to Old Mill Park. In order to make that connection, the City and Park District have been working with the Illinois Department of Transportation (IDOT) to get access on IDOT owned property where Page and Pleasant Street intersect.
In order to facilitate the connection, the City and IDOT are transferring parcels of land for zero compensation. The first parcel consists of 0.251-acres at the southeast corner of North Walnut Street and East Page Street that will be transferred from the City of Sycamore to IDOT. In return the City will acquire 1.085 acres along Pleasant Street. This ordinance approves the transfer of the 0.251-acre site. Resolution 806, below outlines the City’s intent to accept the 1.085 acre parcel from IDOT and grant permission to the Sycamore Park District to construct a trail on the northern edge.
Trails and connections have consistently been noted as a priority during the City’s comprehensive planning processes and the Park District’s planning processes. This “land swap” is another example of units of government working together to take a step forward to meet community objectives.
City Council approval is recommended.
12. RESOLUTIONS
A. Resolution 806—A Resolution Confirming Acceptance of Property Transfer from the State of Illinois.
As noted above in Ordinance 2019.35, the City and Park District have been working with the Illinois Department of Transportation (IDOT) to get access on IDOT owned property where Page and Pleasant Street intersect in order to facilitate the connection of the Great Western Trail to Old Mill Park.
The City and IDOT are transferring parcels of land for zero compensation. The City transferred 0.251-acres at the southeast corner of North Walnut Street and East Page Street as part of Ordinance 2019.35. In return the City will acquire 1.085 acres along Pleasant Street. This resolution outlines the City’s intent to accept the property and grants permission to the Sycamore Park District to construct a trail on the northern edge.
The Park District has secured grant funding from the State of Illinois to make this connection which will be let in January 2020. Construction is expected to begin in Spring 2020.
City Council approval is recommended.
13. CONSIDERA TIONS
A. Consideration of the Annual Property Tax Levy in the City of Sycamore.
The City Council is required to adopt the annual property tax levy by the end of the calendar year. A total of nine local taxing bodies, including the City, annually receive operating revenue from property taxes. The combined or composite property tax rate for residences and businesses located in Sycamore was $9.99967 per $100 EAV in 2018. The City’s rate—$0.687—represented 6.87% of the overall rate applied against the EAV of our residences and businesses.
The City of Sycamore uses the monies raised through property taxes primarily to fund the general operations of the City departments but also uses a substantial portion of the collected taxes to fund pension obligations. The table below shows the breakdown of the annual levy including operational and pension obligations in recent years:
| Property Tax Category | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 |
| General Operating | 1,407,322 | 1,407,322 | 1,407,322 | 1,407,322 | 1,407,322 | 1,407,322 | 1,432,476 | 1,432,476 |
| FICA/IMRF | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 |
| Police Pension | 341,525 | 341,525 | 341,525 | 356,321 | 418,537 | 528,471 | 570,593 | 612,556 |
| Fire Pension | 518,599 | 518,599 | 518,599 | 530,747 | 594,763 | 595,926 | 613,614 | 659,218 |
| Crossing Guards | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 |
| Totals | 2,624,621 | 2,624,621 | 2,624,621 | 2,651,565 | 2,777,797 | 2,888,894 | 2,973,858 | 3,061,425 |
Each year, an independent actuary reviews the current position of the Fire and Police Pension Funds and recommends amounts that the City would need to contribute in order to achieve specific funding benchmarks at the end of a specific period of time. This model makes assumptions regarding a number of different variables such as return on investment, rate of salary increases, life expectancy, etc.
In Illinois, pension funding has plagued many municipalities. The funding shortfall is a combination of lower than expected returns on investments, changes to pension provisions, greater frequency of disability pensions and other plan related factors. In addition, many municipalities fund an amount that is less than the actuarial required amount. Sycamore has historically funded its pensions at or above the 90% State of Illinois requirement through a combination of property tax and personal property replacement tax dollars. Investment returns for both the Fire and Police Pension Funds experienced investment gains (5.10% for Police and 4.70% for Fire) below the actuarial assumption (7.25%) for the year ending April 30, 2019.
The combination of under-funding by many municipalities and market losses against a 2033 amortization period posed a serious problem as the economy was trying to rebound from the 2008- 2009 recession. As a result, the State of Illinois passed Public Act 096-1495 to reset the amortization period to 2040 and establish 90% as the required funding target. These changes were designed to provide some relief, especially to municipalities such as Sycamore that honored the funding obligation. In an attempt to force municipalities to appropriately fund pensions, the Act stipulates that any City not making the minimum contributions will have state funding diverted to the pension funds.
Positive investment returns helped improve the percent funded (64.0% to 66.8% for Police and 63.2% to 65.1% for Fire). The City’s actuary has submitted actuarial assumptions for the Police and Fire Pension Funds indicating the required contribution using two options; a goal of 100% funding and the minimum required contribution with a 90% funding goal.
| Pension Fund | 2018-2019 Contribution | 100% Funding | 90% Funding |
| Police | $647,556 | $759,917 | $601,726 |
| Fire | $698,218 | $960,483 | $774,374 |
The annual required contribution is funded by the property tax levy and a portion of personal property replacement tax receipts. The personal property replacement tax receipts are estimated to be $29,483 for the Police Pension Fund and $44,154 for the Fire Pension Fund next year. After deducting the PPRT portion, the levy required to meet the minimum is $730,220 (+10.73%) for Fire and $572,243 (-6.58%) for Police.
The assumptions discussed below outline levy requests that ensure the minimum 90% threshold is met through the property tax levy. During the budget process or after the annual audit is presented each year, the City will work to determine if an alternative source can be added to the levy to ensure it exceeds the state requirement.
IMRF, Social Security and Medicare
The City’s IMRF and FICA (Social Security and Medicare) obligations are calculated by the City Manager. The IMRF/FICA obligations for Water Division and Treatment Plant employees are paid from the Water and Sewer Enterprise Funds. Altogether, IMRF, FICA, Fire and Police Pensions costs for which levies were voted in 2018 ($1,608,949) constituted 52.56% of the City’s property tax receipts. As a point of reference, in FY01, pension obligations constituted 24% of the City’s property tax receipts.
The City’s combined obligation to Social Security and Medicare is 7.65%. Apart from Fire and Police personnel, full-time employees contribute to the Illinois Municipal Retirement Fund (IMRF). IMRF accumulates money needed to pay benefits from member and employer contributions and from investment returns. The Fund was 90.0% funded as of the end of 2018 after reducing the investment return assumption from 7.5% to 7.25%. With the change in the investment return IMRF has provided communities an option to phase-in the impact by limiting the contribution rate by 10% per year. As a result, the regular IMRF contribution rate for 2020 is estimated to be 8.84%. Unlike the direct levy contributions for the Fire and Police pension plans, the City is required to make contributions to IMRF bi-weekly as the rate (currently 8.04%) is applied against each payroll. The City has maintained the same levy for IMRF, Social Security and Medicare ($337,175) since 2011 and the same is again proposed for 2019.
The combined Fire and Police Pension Fund, IMRF, FICA and Medicare levy contributions total $1,639,638 for 2019.
Calculating the Levy and Rate
The starting point when considering the property tax levy is to estimate the City’s equalized assessed valuation (EAV) for the coming year. Sycamore’s final rate setting EAV in 2018 was $445,724,508. The County Supervisor of Assessment’s preliminary estimates for the City’s EAV for 2019 is $472,578,869 (+6.02%), which includes $7,676,277 in new construction.
This estimate includes deductions for exemptions, the senior freeze, appeals, and TIF. Since the actual EAV for 2019 will not be known until the final tax extension is published next spring, the actual City tax rate, determined by dividing the City levy by the City EAV, will be uncertain. If the actual EAV published next spring is not as high as the projected level, the final City rate may be slightly higher than expectations discussed below.
Historic City EAV, City Levy and City Tax Rate Totals:
| Year | EAV | City Levy | City Tax Rate*Per $100 EAV |
| 1966 | $27,220,176 | $216,252 | $0.79 |
| 1976 | $44,278,153 | $679,882 | $1.54 |
| 1986 | $56,800,908 | $934,248 | $1.64 |
| 1996 | $145,647,122 | $1,792,999 | $1.23 |
| 2006 | $359,225,508 | $2,401,957 | .66912 |
| 2016 | $389,722,536 (+9.01%) | $2,888,894 (+4.0%) | .74127 (-4.60%) |
| 2017 | $419,949,225 (+7.76%) | $2,973,858 (+2.9%) | .70815 (-4.47%) |
| 2018 | $445,724,508 (+6.14%) | $3,061,425 (+2.9%) | .68687 (-3.01%) |
The City has worked to reduce its reliance on property taxes as a percentage of general operating expenditures. This has been accomplished through a combination of fiscal restraint and moving toward more reliance on less regressive alternative revenue sources, such as sales tax. In 2000, property taxes made up 25.7% of all general operating revenues. Since that time, property tax dollars as a percentage of general operating revenues has consistently declined. Property taxes as a percentage from 25.7% in 2000; 18.5% in 2005; 14.4% in 2010 to approximately 12% in 2015 (without levy pass-through pension contributions). This number was 11.38% in 2019 (FY20) and looks to be reduced each year as expenditures rise with inflation and pension obligations continue to increase.
Although the City continues to present and deliver balanced budgets, bond rating agencies review finances for predictability. Property tax revenue presents more predictability than more volatile sources such as sales tax. One way this can be offset is by increasing the general fund reserve policy target. At the end of FY19, the City’s fund balance was 37.58% of total general fund expenditures (consistent with a 4-5 month reserve policy).
City Levy Options
Four options are presented below for consideration. There are several factors that should be considered when reviewing the options. The narrative for each option highlights the proportionate share of property tax revenues as a percentage of the general fund and the net change in funds available for general operations.
For each option the resulting impact on an owner of a $200,000 home is illustrated using the blended increase in EAV for the three respective townships (Sycamore, Cortland and DeKalb).
Option #1: Maintain the City Tax Rate
| Category | 2012 | 2013 | 2014 | 2015
| 2016
| 2017 | 2018 | 2019
|
| General Operating | 1,407,322 | 1,407,322 | 1,407,322 | 1,407,322 | 1,407,322 | 1,432,476 | 1,432,476 | 1,586,223 |
| FICA/IMRF | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 |
| Police Pension | 341,525 | 341,525 | 356,321 | 418,537 | 528,471 | 570,593 | 612,556 | 572,243 |
| Fire Pension | 518,599 | 518,599 | 530,747 | 594,763 | 595,926 | 613,614 | 659,218 | 730,220 |
| Crossing Guards | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 |
| Total Levy | 2,624,621 | 2,624,621 | 2,651,565 | 2,777,797 | 2,888,894 | 2,973,858 | 3,061,425 | 3,245,861 |
| City-Wide EAV | $371,153,227 | $343,636,270 | $337,661,389 | $357,501,358 | $389,722,536 | $419,949,225 | $445,724,508 | $472,578,869 |
| City Tax Rate | 0.70715 | 0.76378 | 0.78527 | 0.77703 | 0.74127 | 0.70815 | 0.68684 | 0.68 |
Results in a level City tax rate of 0.68684.
The total levy is $3,245,861 (6.02% overall increase); with $1,586,223 going to general
operations.
Property Taxes minus the portion going directly to the Police and Fire Pension funds would
represent 12.39% of all budgeted FY20 General Fund expenditures, less pass-thru pension
transfers ($15,685,376).
Increases the funds available to for general operations by $153,747.
Resulting Impact on Single-Family Homeowner: With each of the options, residents want to know what the impact is on their home. The chart below shows the estimated change in the City tax bill for a $200,000 home in 2018 (payable in 2019) and the same home in 2019 (payable in 2020) which is now valued at an estimated $208,602 based on the average increase in EAV (4.30%):
| 2017 | 2018 | |
| Property EAV | 66,667 | 69,534 |
| City Tax Rate | 0.6868 | 0.68684 |
| City Tax Bill | $457.90 | $477.59 |
| Difference | $19.69 |
| Category | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 |
| General Operating | 1,407,322 | 1,407,322 | 1,407,322 | 1,407,322 | 1,407,322 | 1,432,476 | 1,432,476 | 1,401,787 |
| FICA/IMRF | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 |
| Police Pension | 341,525 | 341,525 | 356,321 | 418,537 | 528,471 | 570,593 | 612,556 | 572,243 |
| Fire Pension | 518,599 | 518,599 | 530,747 | 594,763 | 595,926 | 613,614 | 659,218 | 730,220 |
| Crossing Guards | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 |
| Total Levy | 2,624,621 | 2,624,621 | 2,651,565 | 2,777,797 | 2,888,894 | 2,973,858 | 3,061,425 | 3,061,425 |
| City-Wide EAV | $371,153,227 | $343,636,270 | $337,661,389 | $357,501,358 | $389,722,536 | $419,949,225 | $445,724,508 | $472,578,869 |
| City Tax Rate | 0.70715 | 0.76378 | 0.78527 | 0.77703 | 0.74127 | 0.70815 | 0.68684 | 0.64781 |
Should result in a City tax rate of 0.64781.
The total levy is $3,061,425 (No change in the overall levy); with $1,401,787 going to
general operations.
Property Taxes minus the portion going directly to the Police and Fire Pension funds would
represent only 11.21% of all budgeted FY20 General Fund expenditures, less pass-thru
pension transfers ($15,685,376).
Decreases the funds available to for general operations by $30,689.
Resulting Impact on Single-Family Homeowner: With each of the options, residents want to know what the impact is on their home. The chart below shows the estimated change in the City tax bill for a $200,000 home in 2018 (payable in 2019) and the same home in 2019 (payable in 2020) which is now valued at an estimated $208,602 based on the average increase in EAV (4.30%):
| 2018 | 2019 | |
| Property EAV | 66,667 | 69,534 |
| City Tax Rate | 0.6868 | 0.64781 |
| City Tax Bill | $457.90 | $450.45 |
| Difference | ($7.45) |
| Category | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 |
| General Operating | 1,407,322 | 1,407,322 | 1,407,322 | 1,407,322 | 1,407,322 | 1,432,476 | 1,432,476 | 1,452,336 |
| FICA/IMRF | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 |
| Police Pension | 341,525 | 341,525 | 356,321 | 418,537 | 528,471 | 570,593 | 612,556 | 572,243 |
| Fire Pension | 518,599 | 518,599 | 530,747 | 594,763 | 595,926 | 613,614 | 659,218 | 730,220 |
| Crossing Guards | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 |
| Total Levy | 2,624,621 | 2,624,621 | 2,651,565 | 2,777,797 | 2,888,894 | 2,973,858 | 3,061,425 | 3,111,974 |
| City-Wide EAV | $371,153,227 | $343,636,270 | $337,661,389 | $357,501,358 | $389,722,536 | $419,949,225 | $445,724,508 | $472,578,869 |
| City Tax Rate | 0.70715 | 0.76378 | 0.78527 | 0.77703 | 0.74127 | 0.70815 | 0.68684 | 0.65851 |
Should result in a City tax rate of 0.65851.
The total levy is $3,111,974 (1.65% overall increase attributed to new construction); with
$1,452,336 going to general operations.
The levy is maintained at the 2018 level and then applied to existing EAV to calculate the
rate of 0.65851. The rate is then applied to new construction EAV of $7,676,277.
Property Taxes minus the portion going directly to the Police and Fire Pension funds would represent only 11.54% of all budgeted FY20 General Fund expenditures, less pass-thru
pension transfers ($15,685,376).
Increases the funds available for general operations by $19,860.
Resulting Impact on Single-Family Homeowner: With each of the options, residents want to know what the impact is on their home. The chart below shows the estimated change in the City tax bill for a $200,000 home in 2018 (payable in 2019) and the same home in 2019 (payable in 2020) which is now valued at an estimated $208,602 based on the average increase in EAV (4.30%):
| 2018 | 2019 | |
| Property EAV | 66,667 | 69,534 |
| City Tax Rate | 0.6868 | 0.6585 |
| City Tax Bill | $457.90 | $457.89 |
| Difference | ($0.01) |
| Category | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 |
| General Operating | 1,407,322 | 1,407,322 | 1,407,322 | 1,407,322 | 1,407,322 | 1,432,476 | 1,432,476 | 1,511,463 |
| FICA/IMRF | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 | 337,175 |
| Police Pension | 341,525 | 341,525 | 356,321 | 418,537 | 528,471 | 570,593 | 612,556 | 572,243 |
| Fire Pension | 518,599 | 518,599 | 530,747 | 594,763 | 595,926 | 613,614 | 659,218 | 730,220 |
| Crossing Guards | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 | 20,000 |
| Total Levy | 2,624,621 | 2,624,621 | 2,651,565 | 2,777,797 | 2,888,894 | 2,973,858 | 3,061,425 | 3,171,101 |
| City-Wide EAV | $371,153,227 | $343,636,270 | $337,661,389 | $357,501,358 | $389,722,536 | $419,949,225 | $445,724,508 | $472,578,869 |
| City Tax Rate | 0.70715 | 0.76378 | 0.78527 | 0.77703 | 0.74127 | 0.70815 | 0.68684 | 0.67102 |
Should result in a City tax rate of 0.67102.
The total levy is $3,171,101 (3.58% overall increase); with $1,511,463 going to general operations.
A 1.9% levy increase is applied to existing EAV to calculate the rate of 0.67102. The rate is
then applied to new construction EAV of $7,676,277.
Property Taxes minus the portion going directly to the Police and Fire Pension funds would represent only 11.91% of all budgeted FY20 General Fund expenditures, less pass-thru pension transfers ($15,685,376).
Increases the funds available for general operations by $78,987.
Resulting Impact on Single-Family Homeowner: With each of the options, residents want to know what the impact is on their home. The chart below shows the estimated change in the City tax bill for a $200,000 home in 2018 (payable in 2019) and the same home in 2019 (payable in 2020) which is now valued at an estimated $208,602 based on the average increase in EAV (4.30%):
| 2018 | 2019 | |
| Property EAV | 66,667 | 69,534 |
| City Tax Rate | 0.6868 | 0.6710 |
| City Tax Bill | $457.90 | $466.58 |
| Difference | $8.69 |
The City has worked to help stabilize and add predictability to the property tax bill of residents and businesses in our community. Since 2011, the portion of the levy attributed to general operations has only increased only once. This sole increase was the result of significant new construction that allowed a modest increase for general operations while meeting pension contribution requirements without adding an additional burden to existing property owners. With a strong year in new construction and relatively modest increases in pension contributions, it appears the City will slightly increase the dollars available for general operations while without adding any additional burden to existing taxpayers by exercising Option 3: Maintain Levy and Apply Rate to New Construction. The City portion of the property tax rate has decreased each of the past four years and will likely do so again when the 2019 with this option.
Staff is cautiously optimistic when assessing the strength of the City’s key revenue sources. While property tax revenues have diminished as a percentage of the City’s budget, there continues to be reason for optimism as new development and investment in the community continues to increase. As this continued investment is made in our community, the tax base becomes increasingly diversified and other sources of revenue are supplemented by new business. Sycamore relies on sales and use taxes which are less regressive than property taxes, and account for close to one-half of the City’s general operating revenues.
The City’s approach has been and continues to be one of balance; continuing to provide high level services within our means. The balanced approach is not always the easiest as it means providing services and ensuring pension obligations are met with fewer dollars or with revenue sources that are less predictable. Where possible, staff tries to anticipate financial challenges and opportunities that factor into the balanced approach that the City Council has become accustomed to.
The City Council remains committed to meeting obligations including the 90% minimum pension contribution required by Illinois law. Employer contributions from the property tax levy to the Fire and Police pension funds have increased each year and will be $442,339 more for the 2019 levy than the 2011 levy. The property tax generated by the $7.68 million in new construction EAV this year covers the pension contribution requirement increase. Meeting the pension requirement through the property tax levy and then reviewing possible additional alternative sources during the budget process builds flexibility while ensuring fiduciary responsibilities are met.
From there, finding the appropriate balance in the relationship between operating revenues and pension requirements as it relates to property tax funding is essential. This means giving consideration to the percentage of predictable sources, such as property tax. Unless adjustments are made as expenditures increase with inflation, the levy for general operations continues to erode as the percentage of property tax as a portion of the general fund budget.
To position the City in a financially sustainable manner, the City Manager recommends that an option be selected that ensures the City’s pension obligations are met while at least maintaining the property taxes available for general operations.
Option #3: Maintain Property Tax Levy for General Operations meets the City’s stated financial goals and obligations:
State requirements for funding pensions are met.
Although not subject to “tax caps” as a home-rule unit, the City would stay within the inflationary limit applied to other taxing bodies.
Should result in a City tax rate of 0.65851.
The total levy is $3,111,974 (1.65% overall increase attributed to new construction); with $1,452,336 going to general operations.
The levy is maintained at the 2018 level and then applied to existing EAV to calculate the rate of 0.65851. The rate is then applied to new construction EAV of $7,676,277.
Property Taxes minus the portion going directly to the Police and Fire Pension funds would represent only 11.54% of all budgeted FY20 General Fund expenditures, less pass-thru pension transfers ($15,685,376).
Increases the funds available for general operations by $19,860.
The property tax rate decreases by 4.12% and homeowners should pay the same amount to the City as last year.
City Council direction is requested.
B. Consideration of the Sycamore Library Annual Property Tax Levy.
The Sycamore Library is a component unit of the City of Sycamore. Each year the City levies property taxes for the Sycamore Library that are decided by a separate Library Board. As a component unit of the City, the Library is not subject to the limitations of property tax caps.
The Library Board met on November 12th and considered the Library’s budget and 2019 levy. The Library has decided to request a 1.65% increase in its levy bringing it to $1,157,648. As a result, the Library tax rate decreases 4.13% from 0.25551 (2018) to 0.24497 (2019) as a result of the estimated increase in the estimated community EAV.
| Year | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 |
| Library Levy | $943,400 | $971,702 | $971,702 | $1,020,287 | $1,066,295 | $1,119,500 | $1,138,857 | $1,157,661 |
| 3.06% | 3.00% | 0.00% | 5.00% | 4.50% | 4.99% | 1.73% | 1.65% | |
| City-Wide EAV | 371,153,227 | 343,636,270 | 337,661,389 | 357,501,358 | 389,722,536 | 419,949,225 | 445,724,508 | 472,578,869 |
| Library Rate | 0.25418 | 0.28278 | 0.28778 | 0.28539 | 0.27360 | 0.26658 | 0.25551 | 0.24497 |
| 14.04% | 11.25% | 1.77% | -0.83% | -4.63% | -2.57% | -4.25% | -4.13% |
| 2018 | 2019 | |
| Property EAV | 66,667 | 69,534 |
| Library Tax Rate | 0.25551 | 0.24497 |
| Library Tax Bill | $170.34 | $170.34 |
| Difference | $0.00 |
Combined, the City and Library levies make-up the corporate levy. Based on the options recommended above, the corporate levy totals $4,269,635, which represents a 1.65% increase. Current taxpayers should see little change in the amount of taxes paid to the City of Sycamore and Sycamore Public Library in 2020 as new construction accounts for any new dollars being added to the proposed levy.
It is customary for the City to hold a Public Hearing regarding the corporate property tax levy. The City Manager intends to hold a public hearing on the corporate property tax proposal on December 2nd along with a first reading on the levy ordinances.
City Council direction is requested.
C. Consideration of a Police Department Recommendation to Purchase a 2020 Ford Explorer Base Model through the Suburban Policing Cooperation Contract #191 from Kunes Country Ford of Antioch in the amount of $28,734.00.
This new vehicle is intended to replace a 2008 Dodge Caravan which is beginning to have mechanical issues and is due for fleet rotation.
In October a Request for Proposal for a 2020 Ford Explorer Base Model with 4WD was announced in the local newspaper. A price was also obtained from the Suburban Purchasing Cooperative (SPC) which is a joint purchasing program sponsored by the Northwest Municipal Conference (NWMC), DuPage Mayors & Managers Conference (DMMC) South Suburban Mayors and Managers Association (SSMMA), and Will County Governmental League (WCGL). The SPC awarded a cooperative contract to Kunes Country Ford following a competitive bid process for this vehicle.
The received bids and cooperative price through SPC are as follows:
| Company | Vehicle Bid |
| Brad Manning Ford, DeKalb | $31,115.88 |
| Kunes Country Ford, Antioch | $28,734.00 |
| Schimmer Ford, Peru | $29,907.69 |
City Council approval is recommended.
D. Consideration of a Public Works Department Recommendation to Authorize an Increase in the Approved Funding for Repairs of Well #6.
The City Council authorized up to $170,000 for the maintenance and repair of Well #6. The scope and depth of work was unknown at the time as the 1,200+ foot well needed to be removed, assessed and repaired. During that process multiple factors have led to an increase in the cost associated with the project based on the following factors:
Additional Time to Pull and Reinstall Pump
The way the roof was designed and built requires significantly more labor to pull the pump and reinstall the pump. Proposed labor to pull the well was 30 hours and ended up taking 47 hours. It is anticipated that the installation of the pump will take longer than 30 hours. This results in an increase of approximately $26,400.
Bridge
During the televising of the well, a bridge was found at 796ft. A bridge is a slab or significant piece of formation that breaks off the well wall and slides into the bore hole wedging itself in the opening. Over time, sand and formation particles fall on top of the piece causing a partial blockage. Given enough time, it can completely block off the bore hole. This blockage can obstruct the flow of water and could lead to potentially sealing off the well at 796 ft (depth of bridge). Eliminating this bridge allows the water to flow easier up to the pump. Providing the bridge can be removed without requiring it to be re-drilled the cost to remove it is an additional $14,900.
New Pump
Initially, the plan was to rebuild the current pump and bowl assembly. After pulling and inspecting the pump, it was determined that there was too much wear to justify rebuilding it. The current pump has been rebuilt 3 times and given that pulling and re-installing the pump costs over $100,000, the most fiscally prudent answer is to install a new pump that will require less maintenance. The new pump will be made of stainless-steel and should have a much longer useful life than the current cast iron pump. The new pump cost is $59,640, which results in an additional cost over the originally proposed rebuild of $38,700.
Recommendation
Approval of up to an additional $80,000 for the repair of Well #6. This project will be funded from reserves in the Water Fund (02).
City Council approval is recommended.
14. OTHER NEW BUSINESS
15. APPOINTMENTS
16. ADJOURNMENT
https://cityofsycamore.com/wp-content/uploads/2019/11/cc20191118a-amended-1.pdf
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