FINANCE COMMITTEE 2011/02/22 Minutes
The City of Lake Forest
FINANCE COMMITTEE
Proceedings of the February 22, 2011 Meeting
6:30 p.m. – City Hall Council Chambers
I. Call to Order and Roll Call
Chairman Grumhaus called the meeting to order at 6:45 p.m. Present: Mayor Cowhey,
Chairman Grumhaus, Aldermen Novit, Widman, Moore, Morsch, Schoenheider, Looby and
Palmer. Absent: none. Quorum present. There were twelve people present in the audience.
Staff present: Robert Kiely, Jr., City Manager; Kathleen Reinertsen, Finance Director; Louise
Breckan, Assistant Finance Director; Ramesh Kanapareddy, Assistant City Engineer; Diane Hall,
Senior Accountant; Carina Walters, Assistant City Manager and Victor Filippini, City Attorney.
II. Consideration of Minutes from the Finance Committee Meeting Held on January 18, 2011
Alderman Looby made a motion to approve the minutes from the Finance Committee
meeting held on January 18, 2011. The motion was seconded by Alderman Palmer. The
motion carried unanimously by voice vote.
III. Consideration of a Resolution to Adopt the Illinois Municipal Retirement Fund (IMRF) Early
Retirement Incentive Program
Chairman Grumhaus stated that since 1997, the Illinois Municipal Retirement Fund (IMRF) has
offered its member municipalities the opportunity to participate in an early retirement
incentive program. This tool is a useful way for employers to save payroll and fringe-benefit
costs and provide long-tenured employees encouragement to retire. The City has used this
program in the past (2002) when it eliminated over twelve (12) positions within the
organization. The financial benefits to the organization are realized when some of the positions
held by retiring employees are not filled and for those that are, employees are being hired at
a lower salary.
In Spring, 2010 when the Illinois Legislature enacted pension reform legislation, it created a
“two-tiered” benefit system with the estimated financial cost being 38.4% lower than the
current program. Consequently this offers Illinois municipalities the added financial incentive to
hire new employees at a lower salary and lower benefit costs. This change came at a most
opportune time for the City as it explored ways to restructure day-to-day operations to
strengthen our long-term financial picture and still maintain quality services to the residents.
Chairman Grumhaus stated that under the proposed restructuring and retirement program,
the City will realize an annual savings of between $345,000 and $775,000; with a total ten-year
savings in excess of $5,000,000. He stated that this puts the City in a position to have a
balanced budget through at least FY2016. Approximately 20 current employees would retire
from the City and only fourteen (14) would be filled. Of the seven positions not recommended
to be maintained, six of them are in a managerial capacity. Chairman Grumhaus mentioned
that this program will reduce a FY2012 proposed 5% water rate increase to a proposed 2.7%
water rate increase.
Following discussion, Alderman Looby made the motion to approve the resolution adopting
the Illinois Municipal Retirement Fund (IMRF) Early Retirement Incentive Program effective April
18, 2011. Alderman Moore seconded the motion. The motion carried unanimously by voice
vote.
Committee members thanked Chairman Grumhaus and city staff for all of their efforts.
Finance Committee Meeting
Minutes – February 22, 2011
2
IV. City Owned Facilities and City Supported Organizations
City Manager Robert Kiely stated that included in the meeting packet was a matrix that
outlines the City’s responsibilities to several organizations. He stated that the City Council is
requiring that each organization appear before the Audit Committee and have their financial
reports reviewed by the Audit Committee annually in July. Mr. Kiely stated that this matrix will
be a part of the annual budget process. Committee members made several revisions to the
matrix.
V. Opportunity for the Public to Address the Finance Committee: None.
VI. Other Business:
January Flash Report: Chairman Grumhaus reported there are no concerns at this time.
Award of Bid for the Recreation Center Gymnasium and Racquetball Court Lighting
Replacement Project: Mr. Dan Martin, Building Maintenance Supervisor stated that the existing
lighting is over 25 years old. He stated that the proposed lighting project provides energy
efficient lighting as well as provides additional savings through the use of lighting relay controls
in the gym to program time schedules, using multiple switching options (e.g. turn on every
other row or only half the gym lights) and installing occupancy sensors in each racquetball
court. He stated that there were six bids and Ridgeview Electric Inc. was the lowest bidder at
$31,700. Mr. Martin is recommending that at tonight’s City Council meeting, the City Council
award the bid to Ridgeview Electric Inc. in the amount of $31,700 plus a 5% contingency for
any unforeseen problems during the project. This project will be funded by the 2010 Bond
issue.
Approval of an Illinois Department of Transportation (IDOT) resolution appropriating $1,700,000
in Motor Fuel Tax (MFT) funds towards the 2011 Annual Street Resurfacing (ASR) Program:
Mr. Ramesh Kanapareddy, Assistant City Engineer stated that staff is requesting that at
tonight’s City Council meeting, the City Council approve a resolution appropriating $1,700,000
in MFT funds towards the 2011 Annual Street Resurfacing Program. Using MFT funds for local
capital improvement projects require the City to follow IDOT guidelines in terms of project
contract specifications, inspections, and project close-out procedures. The project
construction contract details are to be approved by IDOT prior to bid advertisement.
VII. Adjournment
There being no further business, Alderman Looby moved, seconded by Alderman Novit to
adjourn the meeting at 7:20 p.m. The motion carried unanimously by voice vote.
Respectfully submitted,
Louise Breckan
Assistant Finance Director