DeKalb Times

City of Sycamore City Council met Jan. 3.

Here is the agenda provided by the council:

1. CALL TO ORDER

2. INVOCATION

3. PLEDGE OF ALLEGIANCE

4. APPROVAL OF AGENDA

5. AUDIENCE TO VISITORS

6. CONSENT AGENDA

A. Approval of the Minutes for the Regular City Council Meeting of December 20, 2021.

B. Approval of the Minutes for the Planning and Zoning Commission Meeting of July 12, 2021.

C. Payment of the Bills for January 3, 2022.

D. Façade Closeout for 303 West State Street.

7. PRESENTATION OF PETITIONS, COMMUNICATIONS, AND BILLS.

8. REPORTS OF OFFICERS

9. REPORTS OF STANDING COMMITTEES

10. PUBLIC HEARINGS

11. ORDINANCES

A. Ordinance 2021.26—An Ordinance Approving the Redistricting of the City of Sycamore Ward Map as a Result of the 2020 Census. First and Second Reading.

Municipalities with political wards that experienced a significant change in their population as a result of the 2020 Census are required to redistrict to comply with the “one person, one vote” principle that evolved from the equal protection clause of the Fourteenth Amendment to the U.S. Constitution and the later federal Voting Rights Act of 1965.

The 2020 Census results require an adjustment in ward maps to meet the intent and the letter of state and federal law. The redistricted map is not intended to show how Sycamore might grow, but how Sycamore has already grown. Neither federal nor state law requires mathematical or geographical perfection in the size of wards, but rather requires wards to be as equal, compact, and contiguous as “practicable.” This means that municipalities could attempt to draw their ward lines so residents on both sides of a street are in the same ward, even if that means some variance from the ideal mathematical model. The Council considered three maps at the last meeting and directed the staff to revisit the map proposed below:

City Council approval is recommended.

12. RESOLUTIONS

A. Resolution No. 901—A Resolution Authorizing the City Manager to Designate 2022 Freedom of Information Act Officers and the Open Meetings Act Officer Pursuant to the Freedom of Information Act and Open Meetings Act of the State of Illinois.

Illinois law requires municipalities and other governmental agencies to designate at least one individual to handle Freedom of Information Act (FOIA) requests. FOIA officers are required to complete electronic training on an annual basis through the Illinois Attorney General’s office. The names of the FOIA officers must be displayed on the City’s website. The City of Sycamore traditionally appoints FOIA Officers at the first meeting in January each year.

The Assistant City Manager recommends the designation of the following officers for 2022:

· Mary Kalk, City-wide FOIA Officer;

· Mary Banasiak, Police Department FOIA Officer;

· Kevin Buick, Open Meetings Act Officer.

Due to frequent requests for case information from the Police Department, a FOIA officer with specialized training has been designated to aid the public in such requests.

City Council approval is recommended.

13. CONSIDERATIONS

A. Consideration of an Administration Request for Direction Regarding the 2022-2023 General Fund Fiscal Year Budget.

The City’s annual budget process begins each January with preliminary assumptions about revenue trends and spending priorities for general operations in the upcoming fiscal year. The assumptions are made using the most current financial information available and are offered to invite Council direction as City staff begins the process of preparing a new fiscal year budget that will take effect on May 1st. The culmination of this effort is a preliminary budget for review in mid-March.

The following report summarizes projected General Fund revenues and spending goals for FY2023:

General Fund Revenues

The primary sources of general operating revenues are sales and use tax, property tax, and intergovernmental revenue, which includes a local share of the state income tax. Together, these sources make up 78.22% of all general operating revenues. The amounts collected from minor revenue sources, such as fees, fines, and other miscellaneous revenues, round out the funds available for general operations. The total estimated general fund revenues, including pension pass-through funds, are $19,906,717 in FY23.

A breakdown of revenue sources and assumptions is as follows:

1. Property Tax: 16.00%

This year, the estimated property tax rate decreased by 2.63%. The total levy increased by 1.53% primarily due to contribution requirements of the police and fire pensions. The total levy increase is essentially offset by new construction, which accounts for 1.57% of the City’s EAV, which means existing taxpayers will pay roughly the same amount of property tax to the City as they did the previous year.

Property tax is expected to generate $791,882 toward the fire pension, $581,724 toward the police pension, and $337,175 toward Social Security and the Illinois Municipal Retirement Fund (IMRF).

A total of $433,650 of debt service obligations are abated from the property tax levy. These obligations are met primarily through the use of other dedicated sources of revenue. Historically, the City has levied $155,000 toward debt service beginning with the 1999 General Obligation Bond. The remaining debt service is paid from general operating and capital funds.

2. Sales and Use Taxes: 47.84%

Sales and use taxes make up nearly one-half of the City’s general operating budget. These taxes include the state 1% sales tax, home rule sales tax, restaurant and bar tax, and telecommunications tax.

State Sales and Use Tax: This 1% tax is applied against all retail sales within the City and accounts for about 25% of all annual general revenues. Tax receipts are processed by the Illinois Department of Revenue before funds are remitted to the City. Using monthly comparisons to establish a trend line, it appears the state 1% tax will yield about $5,468,300 by April 30, which is well ahead of the FY22 budget projection ($4.91 million) for this line item.

Sales tax projections are challenging for the coming year as the pent-up demand from COVID 19, considerable stimulus, and advanced child-tax credits have factored into very strong receipts. With the possibility of a slow-down as inflation continues and stimulus ceases, staff conservatively projects this source to yield $5,304,251 in FY23.

Home Rule Sales Tax: The City’s home rule sales tax funds general operations, capital projects, and the street maintenance program. Home rule sales tax is applied to general merchandise sales, but not to items such as groceries, medical supplies, or automobiles. Currently, the City’s home rule tax is 1% for general operations, 0.25% for capital projects, and 0.50% for street maintenance.

Current trends suggest a home rule sales tax revenue of $2,847,000 that will considerably out pace the FY22 budget ($2.25 million). Home rule tax tends to be more volatile since it does not apply to food or qualifying medical and online purchases that are charged the 1% use tax.

Proceeds estimated to be $2,704,650 will comprise 13.59% of all General Fund revenues in FY23.

Restaurant/Bar Tax: In 2002, a 2% restaurant/bar tax was implemented to support general operations and fund debt service. This is considered a local tax, meaning it is administered and collected by the City. In FY23, tax revenues from this source ($1,300,000) are projected to constitute 6.53% of general revenues.

Telecommunication Tax: In 2003, a 5% telecommunication tax was implemented. This tax applies to both land-lines and cellular phones and is charged against the caller’s billing address. This tax is collected by the Illinois Department of Revenue and remitted monthly to the City. Telecommunication tax revenues continue to trend downward. As a result, the expected FY23 telecommunication tax revenue estimate has been reduced to $215,000 which will constitute 1.08% of the total budgeted operating revenues. As a point of reference, the total of all sales and use tax revenues for the General Fund.

Budgeted FY23 sales and use tax revenues are expected to decrease over FY22 estimates by 3.27%. Conservative estimations were made to account for the potential impact of inflation, rising interest rates, and the end of stimulus and advanced child tax credits.

3. Licenses: 0.59%

Licenses are modest fees charged to offset the administration and enforcement of specific programs. These include revenue for liquor, electrical, and other licenses. The elimination of dog tag licenses are reflected in the FY23 budget.

4. Intergovernmental Revenue: 14.38%

Intergovernmental revenue includes funds that come from agreements with other taxing bodies, such as our boundary agreement with the City of DeKalb, and any grant and state-shared revenue, notably income tax. Intergovernmental revenue is expected to produce $2,437,000 in FY23.

Income Tax: A percentage of all state income tax receipts are deposited into the Local Government Distributive Fund through the Illinois Department of Revenue and distributed to municipalities on a per capita basis. Historically, this percentage has changed on a proportionate basis to reflect the current State income tax rate. The City budget projection for FY23 is based on ($131.20) of the Illinois Municipal League estimates per capita as published in November 2021. Given the City’s population of 18,577 (2020 Census), Sycamore’s share of income tax receipts is estimated to be $2,437,000. This is an increase of $641,302 from the FY22 budget.

It should be noted that this assumes that the State of Illinois will not make reductions to the formula by which income tax is distributed to local governments.

5. Service Charges: 7.38%

Service charges include ambulance fees, fire and ambulance protection district fees, and development fees. Service charges are expected to generate $1,468,856 in FY23. The largest revenue source in this category is fire user fees, which are estimated to be $1,032,500.

Development-related fees remain relatively static with a consistent pace of development in all three sectors over the past few years. A similar trend is anticipated in FY23.

6. Fines and Fees: 0.60%

Fines and fees are generally associated with revenue received from court fines, ordinance violations, parking meter fees, and other fines associated with administrative adjudication. These sources are estimated to generate a total of $119,000 in FY23.

7. Other Income/Transfers: 13.21%

The majority of the other income category involves revenue generated from trash removal services. This allocation ($1.799 million) is offset by a corresponding expense paid to Waste Management for garbage collection. Other sources include franchise fees, reimbursements, and operating transfers. Operating transfers are made to offset the services performed by the General Fund on behalf of another fund. No reserve transfers are anticipated in FY23 to support general operations.

Overall, revenue projections assume a continuation of modest growth and development. The projections do not anticipate any significant impact, positive or negative, based on the economic climate and revenue sharing models of the State or Illinois. Based on the trends and projections, the total revenues of $19,906,717 will offset expenditures associated with general operations and pension obligations.

General Fund Expenditures

On the spending side, the preliminary FY23 budget includes:

· A total of $19,905,973 in expenditures.

· The same level of service is anticipated in the FY23 budget.

· Wage increases for Union positions are outlined in each of the respective Collective Bargaining Agreements. Non-Union positions will receive 2.5% increases.

· One new position, “Information and Technology Coordinator,” is included in the FY23 budget within the Administration Department.

· Personnel expenses (wages, salaries, FICA, Medicare, IMRF, Police and Fire Pension) will again account for over half of the overall General Fund budget (47.16%). When combined with the cost of insurance coverage (health, life, work comp and liability), employee costs reach 63.15% of the planned General Fund expenditures. Insurance costs are assigned to the General Fund Support budget, which consists of expenditures common to the entire General Fund.

· $367,500 will be transferred to the 2012 and 2017 Refunding Bond Funds in FY23 to assist with debt service obligations.

· $300,000 will be transferred from the General Fund Support to the Employee Benefit Assistance Fund to fund accrued time payouts for employees at the time of separation. This has been included in the operating model rather than a reserve transfer.

· Pension contributions to the Police, Fire, and IMRF (with the exception of personnel assigned to the Water and Sewer Funds) pass through or are expended from the General Fund.

· Police and Fire pension contributions assume a 90% target; however, the General Fund budget includes an additional $150,000 to each fund to work toward 100% funding levels.

· The preliminary FY23 General Fund budget is balanced without reliance on transfers in from capital funds or reserves.

Summary

The preliminary FY23 General Fund budget is balanced as presented. City departments continue to provide quality service while working within the resources available. For a number of years, the City has worked to add predictability to the property tax levy, maintain strong service levels, and manage the General Fund without reliance on capital transfers. The City has taken steps to ensure budget flexibility while forecasting as accurately as possible given the continued impacts of the COVID-19 pandemic and the financial infusion through the recovery response.

A breakdown of individual FY23 revenues and expenditures by department is attached. Over the next several meetings, the preliminary assumptions of the budget process for the different funds will be presented as follows:

January 18th: Water and Sewer Funds

February 7th: Capital Funds and Capital Improvement Plan

February 21st: Special and Bond Funds

March 21st: Preliminary Budget and Public Hearing

April 4th: First Reading on Appropriation Ordinance

April 18th: Second Reading and Adoption of Appropriation Ordinance

As this process moves forward, City management will continue to monitor trends and look to solidify these assumptions and make changes where necessary for final presentation in April.

City Council direction is requested.

B. Consideration of an Administrative Recommendation to Award a Contract in the Amount of $38,650.00 to DeKalb Mechanical of DeKalb, Illinois for the Replacement of Two Rooftop Units at the City Center.

The current rooftop units have serviced the building for the past 23 years despite a life expectancy of 14-16 years. For the past several years, the rooftop units have had numerous service calls for repairs and replacement parts to accommodate the demand of these units. More recently, one of the units began to develop more significant repair needs, including a replacement heat exchanger. Given the time of year, this has become an essential repair. Staff solicitated quotes for replacement of the units. The City contacted four companies that have worked on various units within the city; of the four, two were able to quote at this time. Due to supply shortages, the other two companies opted not to quote as they would not be able to provide replacement any time in the near future. Quotes are as follows:

DeKalb Mechanical $38,650.00

Service Concepts

$46,850.00

Given the age of the units and current demand, it is the administration’s recommendation to replace both rooftop units in the amount of $38,650 to DeKalb Mechanical of DeKalb, Illinois.

City Council approval is recommended.

C. Consideration of a Recommendation from Public Works for a Change Order for Leander Construction Inc. for the Sycamore Wastewater Treatment Plant Contract Related to Additional Labor Resulting in Payment of $5,382.55.

During the construction of the Wastewater Treatment Plant, the installation of the mixers within the sequencing batch reactors (SBRs) was modified. This modification resulted in additional material and labor. Through a collaborative effort between the manufacturer (Xylem) and contractor (Leander Construction Inc.), it was mutually agreed upon to complete this work at no additional net cost to the City. Material was deemed incidental, and the additional labor provided by the contractor was offset by a deductive change order to the manufacturer’s contract.

When existing wastewater treatment plant tanks are decommissioned, the removal and disposal of sludge material is required. The work required of the contractor exceeded the quantities as estimated by the design engineer; thus, an additional quantity of 15,000 gallons was measured and a unit price of $0.08 per gallon was agreed upon by the contractor, consulting engineer, and City staff.

In conjunction with approval of the Change Order to Xylem’s contract, staff recommends this work is included as part of Leander Construction’s scope of work with a total cost of $5,382.55.

City Council approval is recommended.

14. OTHER NEW BUSINESS

15. APPOINTMENTS

16. ADJOURNMENT

https://cityofsycamore.com/wp-content/uploads/2021/08/20220103-CC-Final.pdf