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CITY COUNCIL 11/07/2022THE CITY OF LAKE FOREST CITY COUNCIL AGENDA Monday, November 7, 2022, 6:30 pm 220 E. Deerpath, Lake Forest, IL 60045 Honorable Mayor, George Pandaleon James E. Morris, Alderman First Ward Jim Preschlack, Alderman Third Ward Nancy P. Novit, Alderman First Ward Ara Goshgarian, Alderman Third Ward Melanie Rummel, Alderman Second Ward Raymond Buschmann, Alderman Fourth Ward Edward U. Notz, Jr., Alderman Second Ward Eileen Looby Weber, Alderman Fourth Ward CALL TO ORDER AND ROLL CALL 6:30 pm PLEDGE OF ALLEGIANCE REPORTS OF CITY OFFICERS 1.COMMENTS BY MAYOR A.Introduction of Niamh Bruce, Mayor for a Day B.GFOA Triple Crown Award Presentation and Recognition of Finance Department 2.COMMENTS BY THE CITY MANAGER A.Community Spotlight -Native Voices Initiative Carol Summerfield, Lake Forest Lake Bluff History Center B.Public Works Capital Projects Recap -Michael Thomas, Director of Public Works C.Looking Forward – Planning for the Future of Our Central Business District -Introduction of Website -Upcoming Community Workshop 3.OPPORTUNITY FOR CITIZENS TO ADDRESS THE CITY COUNCIL 4.COMMITTEE REPORTS 1 Monday, November 7, 2022, City Council Agenda AUDIT COMMITTEE REPORT 1. Audit Committee Report and Presentation of the Fiscal Year 2022 Annual Comprehensive Financial Report PRESENTED BY: Tara Janos, Audit Committee Chair STAFF CONTACT: Diane Hall, Assistant Finance Director (847-810-3614) PURPOSE AND ACTION REQUESTED: Staff requests receipt of the audit report for the fiscal year ended April 30, 2022. BACKGROUND/DISCUSSION: The Annual Comprehensive Financial Report for the fiscal year ended April 30, 2022 is provided beginning on page 14. A bound copy of the report is available upon request and an electronic copy will be made available on the City web site following City Council acceptance of the report. The document has been reviewed by the Audit Committee with Baker Tilly Virchow Krause, the City’s independent audit firm, and has been accepted by the Audit Committee. The City has received an unmodified opinion on its Fiscal Year 2022 financial statements. The City has been awarded the Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association for forty-three (43) consecutive years. This year’s report will once again be submitted to GFOA for consideration of this award. The Audit Committee met four times in 2022 and highlights of those meetings as well as the audit report will be presented this evening by Audit Committee Chair Tara Janos. COUNCIL ACTION: Receipt of the audit report for the fiscal year ended April 30, 2022. 5. ITEMS FOR OMNIBUS VOTE CONSIDERATION 1. Approval of October 17, 2022, City Council Meeting Minutes A copy of the minutes can be found beginning on page 206. COUNCIL ACTION: Approval of October 17, 2022, City Council Meeting Minutes 2. Approval of the Check Register for the Period of September 24 – October 28, 2022 STAFF CONTACT: Elizabeth Holleb, Finance Director (847-810-3612) BACKGROUND/DISCUSSION: City Code Section 38.02 sets forth payment procedures of the City. The Director of Finance is to prepare a monthly summary of all warrants to be drawn on the City treasury for the payment of all sums due from the City (including all warrants relating to payroll and invoice payments) by fund and shall prepare a detailed list of invoice payments which denotes the person to whom the warrant is payable. The warrant list detail of invoice payments shall be presented for review to the Chairperson of the City Council Finance Committee for review and recommendation. All items on the warrant list detail recommended for payment by the Finance Committee Chairperson shall be presented in summary form to the City Council for approval or ratification. Any member of the City Council 2 Monday, November 7, 2022, City Council Agenda shall, upon request to the City Manager or Director of Finance, receive a copy of the warrant list detail as recommended by the Finance Committee Chairperson. The City Council may approve the warrant list as so recommended by the Finance Committee Chairperson by a concurrence of the majority of the City Council as recorded through a roll call vote. The Council action requested is to ratify the payments as summarized below. The associated payroll and invoice payments have been released during the check register period noted. Following is the summary of warrants as recommended by the Finance Committee Chairperson: Check Register for September 24- October 28, 2022 Fund Invoice Payroll Total 101 General 836,054 2,266,215 3,102,269 501 Water & Sewer 147,570 270,081 417,651 220 Parks & Recreation 243,534 670,012 913,546 311 Capital Improvements 2,722,619 2,722,619 202 Motor Fuel Tax 17,432 17,432 230 Cemetery 42,239 58,514 100,753 210 Senior Resources 10,494 43,035 53,529 510 Deerpath Golf Course 58,819 4,374 63,193 601 Fleet 128,274 87,297 215,571 416 - 433 Debt Funds 0 248 Housing Trust 0 201 Park & Public Land 30,488 30,488 All other Funds 1,394,586 273,351 1,667,937 $5,632,109 $3,672,878 $9,304,987 The subtotal labeled “All other Funds” includes Self Insurance Fund Medical/Dental claims expenses of $863,428. COUNCIL ACTION: Approval of the Check Register for the Period of September 24 – October 28, 2022 3. Approval of Health Insurance Contract Renewals for Calendar Year 2023 STAFF CONTACT: Amber Campbell, Director of Human Resources (847-810-3532) PURPOSE AND ACTION REQUESTED: PCA Committee and staff are recommending the following renewals of the City’s various health insurance vendors: The City provides a self-funded medical and dental plan and insured life insurance, transplant coverage, and reinsurance (stop loss) for large claims and total liability. The cost is determined by forecasts based on actual claims, fixed costs for administration, reinsurance, and costs for life insurance. The City periodically requests bids for administration and stop loss insurance. Staff is preparing to conduct a more comprehensive review of benefit plan alternatives in FY24. Human Resources is not recommending changes this year for strategic considerations as the plan is meeting expectations. 3 Monday, November 7, 2022, City Council Agenda Cigna has provided Life Insurance since 2004, providing a contract that allows for a custom designed package developed with Benefit Committee input of employer provided insurance, and supplemental coverage that is able to be continued after leaving the City. The City has a contract which automatically renews. No premium increase has been received, although Cigna has the ability to change the rate with advance notice. The contract was last bid in 2014, and Cigna remained the best option. The costs are determined on a pooled basis, and were last changed in 2018. The City purchases Stop Loss insurance for individual claims and total plan liability. Insurance consultant Wright Benefit Strategies (WBS) recommended bidding stop loss this year after a full RFP and moving to Sun Life effective in 2021. We typically bid this service approximately every two to three years, as more bidding and changing carriers reduces leverage in negotiations in difficult claim years and puts the City at greater risk of large exclusions, rate increases, or both. The City contracts administration services and PPO Managed Care services through PBA, which includes Cigna PPO. Staff is recommending retaining PBA and Cigna managed care services. The City contracts with Asset Health to manage our Think Healthy Wellness plan programming and website, which employees use to access learning, resources and tracking tools. Staff recommends retaining Asset Health for a successive one-year term. Bidding other services is not recommended at this time due to existing multi-year contracts, favorable renewals and contractual features relating to our benefit structure. PROJECT REVIEW/RECOMMENDATIONS: Reviewed Date Comments Personnel, Compensation and Administration (PCA) Committee 10/28/22 Reviewed and recommended for City Council approval BUDGET/FISCAL IMPACT: Recommendations based on renewal quotes: • Retain Cigna for Life Insurance Coverage Cigna provides a unique contract design and is meeting expectations. Cigna has not provided notice of renewal. • Retain Professional Benefit Administrators (PBA) for Administration and Billing Services PBA bills per capita fees, including Cigna PPO fees. The fee increase reflects additional services required by the No Surprises Act, requiring the Plan to disclose reimbursement rates for services, among other requirements. PBA is a low-cost provider for administration of the City health and dental plan, including claims administration and coordination of medical plan services and the City flexible spending account. WBS bid TPA services in 2020, and PBA’s cost were low in comparison to bids. Staff and the City’s insurance consultant recommend retaining PBA based on their service and the nature of the City’s benefit structure. PBA is meeting expectations. • Retain preferred provider network administration with CIGNA through PBA Cigna provides networks and managed care services through a contracted relationship 4 Monday, November 7, 2022, City Council Agenda with PBA. CIGNA provides broad access and favorable discounts. Services are meeting expectations. • Change to Symetra for Stop Loss Coverage and Retain Optum Health for Transplant coverage. WBS manages placement of Specific reinsurance for large claims and Aggregate reinsurance for total claims in a calendar year. The City entered a new contract with Sun Life in 2021. WBS recommended bidding stop loss coverage for the 2023 plan year. Three carriers provided bids below Sun Life. Sun Life is requesting an increase in premiums, while Symetra provided a bid that will reduce stop loss premiums from the current level, and reduce assumed risk by the City. WBS recommends moving to Symetra for stop loss coverage at the $170,000 deductible. Optum provides a separate Transplant policy, which helps protect the Stop Loss experience by carving out transplant expenses. Optum rates are increasing 6%, the first increase since 2020. WBS recommends retaining Optum carve out coverage. Stop Loss Current Sun Life 170k deductible 2022 Renewal: Sun170k deductible Symetra $170k deductible Specific & Aggregate Premium $733,688 $816,852 $702,878 • Retain Serve You Rx Pharmacy Benefit Administration for Prescription Drug Card for an additional one-year term. Serve You Pharmacy Card services are provided through a contract that renews annually. The City last bid this coverage in 2018, and Serve You provided the most favorable contract. WBS negotiated an increase in discounts, and rebates for 2023. The changes are expected to reduce costs through better discounts and increased rebates. Serve You services are meeting expectations. Staff and the City’s benefit consultant WBS recommend retaining Serve You. Summary Pricing Serve You Rx Serve You Current Serve You Renewal Costs Dispensing Fees (Retail Only) $1,741 $1,509 Brand Discount Retail/Mail Order 18%/24% 18.5%/24% Generic Discount Retail/Mail Order 78%/82% 78.25%/83% Rebates Paid to Plan $(141,870) $(171,075) • Retain Asset Health services for Think Healthy Wellness Program Staff is recommending renewing the contract for wellness services through Asset Health, a leading provider of wellness technology and administration for 1 million members including fortune 500 companies. Asset Health provides consulting, participant administration through a website, health and wellbeing learning exercises, activity “challenges” (time sensitive activities designed to reinforce positive behaviors linked to improved health), as well education by self-determined 5 Monday, November 7, 2022, City Council Agenda and programmatic learning. The services are meeting expectations for reduced staff time in administration, improved communication, and education resources available to participants, while reducing health cost growth over time. The service has been well received by employees and is actively managed through our Employee Wellness Committee. Through reporting from Asset Heath and the City’s health plan, WBS has observed that costs may be trending lower than other employers through reduced utilization. Results suggest the City continues to see positive behavioral change and lower health plan utilization particularly for drugs compared to other plans. Participation is widespread among employees. The City did not bid the service this year due to the unique and integrated nature of the service to the relatively new Think Healthy wellness program, which has been in its current form since 2018. o Retain Benistar Medicare Supplement and Part D Plans as Retiree Benefit Effective since 2018, the City makes available a separate fully insured Retiree Medical and Drug program for retirees eligible for Medicare through Benistar. Retirees pay 100% of the cost. The City provides billing remittance and Benistar provides customer service and coordination of a Harford Medicare Supplement Plan, and an Express Scripts Part D prescription drug plan. This policy is less costly for retirees over 65 and is fully insured, so the city has no liability. The plans are subject to annual cost adjustments for Medicare Supplement and Part D Drug Coverage. Staff recommends continuing to offer this coverage. Age Band-Medical Current January 1, 2023 65-69 $128.00 $134.28 70-74 $147.16 $154.37 75-79 $171.30 $179.70 80-84 $193.50 $202.98 85 and over $203.55 $213.53 Express Scripps Part D $235.00 $246.00 Summary Budget Impact: Funding Source: Self-Insurance Fund Spread over FY23 and FY24 budgets Current Amount Requested Budgeted? Cigna Life Insurance $29,251 $29,251 Yes Summary Pricing Serve You Rx Yes Dispensing Fees (Retail Only) $1,741 $1,509 Yes Summary Pricing PBA Admin Fees & CIGNA PPO $151,951 $161,077 Yes Summary Pricing Sun Life Stop Loss • Specific & Aggregate Premium $733,688 $702,878 Yes • Transplant Premium (Optum) $30,133 $31,929 Yes Summary Pricing Asset Health Wellness $30,000 $30,000 Yes Total Annual Plan Costs $976,764 $956,644 Has City staff obtained competitive pricing for proposed goods/services? NO If no, indicate the specific exception or waiver requested: 6 Monday, November 7, 2022, City Council Agenda Administrative Directive 3-5, Section 6.1I – Existing Relationship COUNCIL ACTION: Approval of Health Insurance Contract Renewals for Calendar Year 2023 4. Approval of the FY23 Personnel Policies and Practices STAFF CONTACT: Amber Campbell, Director of Human Resources (847-810-3532) PURPOSE AND ACTION REQUESTED: The Personnel Compensation Administration (PCA) Committee is seeking City Council approval of the FY23 Personnel Policies. BACKGROUND/DISCUSSION: As a part of the FY23 budget process City Council approved the recommendation to increase the amount paid for 20+ years of service from $75 to $90 per year of service. The Police MAP contract effective FY22-FY25 adjusted longevity and for 20+ years of service from $75 to $90 per year of service. Personnel policy language has been updated to reflect $90 for the 20+ year of service level. Personnel Page # Personnel Policies and Practices 2022 (All changes noted in Italics in the document) • 2.3.14 Longevity Pay – Increased the amount paid for 20+ years of service from $75 to $90 (last increased in 2016) 11 PROJECT REVIEW/RECOMMENDATIONS: Reviewed Date Comments PCA Committee 10/28/2022 Reviewed individually and recommends approval BUDGET/FISCAL IMPACT: The budget impact for employees with 20+ years of service is $22,777 and is included in the current FY23 budget. COUNCIL ACTION: Approval of the FY23 Personnel Policies and Practices Changes 5. Approval of Revised Employment Agreement for City Manager Wicha STAFF CONTACT: Amber Campbell, Director of Human Resources, 847-810-3530 PURPOSE AND ACTION REQUESTED: Consistent with recent Mayor and City Council discussion, approval of an updated Employment Agreement for City Manager Jason Wicha is requested. BACKGROUND/DISCUSSION: The City Manager’s current Employment Agreement, which was most recently revised in July 2020, includes a City residency requirement with a corresponding residence loan. In recognition of City Manager Wicha’s performance and years of service to the City, the amended Employment Agreement provides a gradual annual reduction in the 7 Monday, November 7, 2022, City Council Agenda balance of the residence loan through May 1, 2032, contingent upon City Manager Wicha’s continued employment with the City. In addition, the City Manager’s annual salary is being adjusted to be consistent with the mid- range of salaries in comparable communities, which reflects the City Council’s broader guidance on employee compensation. BUDGET/FISCAL IMPACT: Sufficient funding is available within the FY23 budget for the salary adjustment and loan forgiveness. Beginning on page 210 of your packet is a copy of the revised Employment Agreement. COUNCIL ACTION: Approval of Revised Employment Agreement for City Manager Wicha 6. Approve the contract to Camp Nageela Midwest, dba Camp Henry Horner in the amount of $35,000. STAFF CONTACT: Todd Nahigian, CROYA Manager 810-3982 PURPOSE AND ACTION REQUESTED: The CROYA Board and Staff are recommending approval of a contract with Camp Nageela Midwest, dba Camp Henry Horner in the amount of $35,000. BACKGROUND/DISCUSSION: CROYA High School weekend Retreats date back to 1987 with over 5,000 high school students attending over 30 years. CROYA youth and staff consider the Retreats the most meaningful and impactful programs CROYA provides. Over the years, the CROYA Staff has investigated multiple camps in Illinois and Wisconsin, after a previously attended camp stopped hosting groups during the school year. CROYA staff found Camp Henry Horner in Ingleside, IL, which provides the highest quality experience while maintaining reliability. CROYA began attending Camp Henry Horner in the Fall of 2016, and has continued this valuable tradition. Their facilities, location, service quality, price and overall experience are a great fit for CROYA. The Camp Henry Horner staff is accessible and responsive to our needs. The total cost of the two annual retreats has typically been below $25,000. In FY2022, City Council approved CROYA’s request of $30,000 for the 2 Retreats. This was necessary because we increased the number of participants and the costs went up. The circumstances are similar this year, as the cost of the Fall, 2022 and Spring, 2023 Retreats will be over $25,000. BUDGET/FISCAL IMPACT: CROYA currently charges students $180 each to attend a Retreat. Revenue for the 2 Retreats during this fiscal year is estimated to be $30,000. There are other expenses for the retreat, but I wanted to acknowledge that the cost of the Retreat site, lodging and meals is commensurate with the revenue CROYA receives. Has City staff obtained competitive pricing for proposed goods/services? No Administrative Directive 3-5, Section 6.1I – Existing Relationship Below is an estimated summary of Project budget: 8 Monday, November 7, 2022, City Council Agenda FY2023 Funding Source Amount Budgeted Amount Requested Budgeted? Y/N 101-1601-483.60-17 $30,000 $35,000 (Y) The additional Retreat participants will cover the non-budgeted amount. COUNCIL ACTION: Approval of the contract to Camp Nageela Midwest, dba Camp Henry Horner in the amount of $35,000 7. Consideration of a Request to Waive the Fidelity Bond Requirement in Connection with Holding a Raffle in the City of Lake Forest for Lake Forest College Chapter of the American Marketing Association and Lake Forest College Athletics (Approval by Motion) STAFF CONTACT: Margaret Boyer, City Clerk (847.810.3674) PURPOSE AND ACTION REQUESTED: Staff requests City Council consideration of waiving the fidelity bond requirement in connection with a proposed raffle from Lake Forest College Chapter of the American Marketing Association and Lake Forest College Athletics. BACKGROUND: In January 2020 the City Council approved an Ordinance Amending Chapter 110, titled “Licenses and Miscellaneous” related to Raffles, to align these sections with recent State of Illinois Legislation. Section 110.0149, J, allows the raffle manager designated by the organization to seek a waiver of the bond requirement from the City Council. At this time Lake Forest College Chapter of the American Marketing Association and Lake Forest College Athletics are requesting a waiver of the bond requirement and has submitted a request. A copy of the requests can be found beginning on page 215 BUDGET/FISCAL IMPACT: N/A COUNCIL ACTION: Consideration of a Request to Waive the Fidelity Bond Requirement in Connection with Holding a Raffle in the City of Lake Forest for Lake Forest College Chapter of the American Marketing Association and Lake Forest College Athletics. (Approval by Motion) 8. Determination of a Non-Binding Estimate of the Amount of Revenue to be Generated from Property Taxes for the 2022 Calendar Year and Establishment of December 5, 2022 as a Public Hearing Date (if required) in Accordance with the Truth in Taxation Statute STAFF CONTACT: Elizabeth Holleb, Finance Director (847-810-3612) PURPOSE AND ACTION REQUESTED: Staff requests City Council approval of a non-binding estimate of the amount of revenue to be generated from property taxes in calendar year 2022 and setting of a public hearing date if this estimate exceeds 105% of the prior year’s tax extension in accordance with State Statutes. BACKGROUND/DISCUSSION: Under the Truth in Taxation Act, the City Council is required to determine the estimated amount of money to be raised by taxation twenty (20) days prior to 9 Monday, November 7, 2022, City Council Agenda the adoption of the annual tax levy. The amount determined is an estimate, and may be increased or decreased under the statute, provided that any increase does not exceed 105% of the prior year’s tax extension without the required notice and public hearing. This estimate is preliminary and initiates the public process for the 2022 tax levy by establishing an estimated amount from which staff can prepare a proposed levy ordinance. The 2022 property tax levy estimate, as considered by the Finance Committee on October 17, is as follows: Levy 2021 Extended 2022 Levy Estimate % Increase (Decr.) Aggregate Levy $ 34,137,742 $ 35,816,761 4.92% Debt Service Levy 1,839,687 1,825,725 -.76% PTAB/CE Recapture 266,960 N/A TOTAL LEVY $ 36,244,389 $ 37,642,486 3.86% The tax levy cap applicable to the 2022 tax levy is 5.0%. The 2022 tax levy estimate reflects: • Assessed valuation estimates provided by the Lake County Assessor’s Office (up 2.4%), • required funding for police and fire pension purposes as established by a 4/30/22 independent actuarial valuation and reflecting the Pension Funding Policy approved 8/3/20, as well as additional funding as recommended by the Lake Forest Pension Subcommittee to accelerate implementation of the 15-year open amortization model, • Required debt service levy amounts as established by bond ordinances approved at the time of debt issuance, • Capital Improvements Fund levy consistent with FY23-27 Five-Year Forecast, increased by $350,000 to phase in impacts of potential future bond issue for athletic field improvements, • 5.0% PTELL increase on library and parks/recreation levy line items which have consistently been limited to PTELL, and • An estimate of new growth, which impacts the General Fund and Library operating levies. Based on the preliminary estimate, a public hearing would not be required under the Truth in Taxation Act. A discussion regarding the 2022 tax levy is scheduled for the November 14 Finance Committee budget workshop. The tax levy ordinance will be considered by the City Council on November 21 and again on December 5, 2022. PROJECT REVIEW/RECOMMENDATIONS: Reviewed Date Comments Finance Committee 10/17/22 Reviewed 2022 Tax Levy Estimate City Council 8/3/20 Approval of revised Pension Funding Policy 10 Monday, November 7, 2022, City Council Agenda COUNCIL ACTION: Determination of a Non-Binding Estimate of the Amount of Revenue to be Generated from Property Taxes for the 2022 Calendar Year and Establishment of December 5, 2022 as a Public Hearing Date (if required) in Accordance with the Truth in Taxation Statute. 9. Consideration of an Ordinance Approving a Recommendation from the Building Review Board. (First Reading, and if Desired by the City Council, Final Approval) STAFF CONTACT: Catherine Czerniak, Director of Community Development (810-3504) PURPOSE AND ACTION REQUESTED: The following recommendation from the Building Review Board is presented to the City Council for consideration as part of the Omnibus Agenda. BACKGROUND/DISCUSSION: 549 King Muir Road – The Building Review Board recommended approval of a building scale variance to allow the addition of a mudroom and covered entrance at the rear of the home. No public testimony was presented to the Board on this petition. (Board vote: 6 - 0, approved) The Ordinance approving the petition as recommended by the Building Review Board, with key exhibits attached, is included in the Council packet beginning on page 217. The Ordinance, complete with all exhibits, is available for review in the Community Development Department. COUNCIL ACTION: If determined to be appropriate by the City Council, waive first reading and grant final approval of the Ordinance approving the petition in accordance with the Building Review Board’s recommendation. COUNCIL ACTION: Approval of the nine (9) omnibus items as presented. 6. OLD BUSINESS 7. NEW BUSINESS 8. ADDITIONAL ITEMS FOR DISCUSSION/ COMMENTS BY COUNCIL MEMBERS 1. EXECUTIVE SESSION pursuant to 5ILCS120/2(c), 11 The City Council will be discussing pending litigation Adjournment into Executive Session Reconvene into Regular Session 9. ADJOURNMENT 11 Monday, November 7, 2022, City Council Agenda A copy of the Decision Making Parameters is included beginning on page 13 of this packet. Office of the City Manager November 2, 2022 The City of Lake Forest is subject to the requirements of the Americans with Disabilities Act of 1990. Individuals with disabilities who plan to attend this meeting and who require certain accommodations in order to allow them to observe and/or participate in this meeting, or who have questions regarding the accessibility of the meeting or the facilities, are required to contact City Manager Jason Wicha, at (847) 234-2600 promptly to allow the City to make reasonable accommodations for those persons. 12 ^Qtu^^ C^'NA<WA£BT-<^ ^.Scie^^t^wS^'X. §.. ^..,,.e-..^ f-l&ff"^ THE CITY OF LAKE FOREST DECISION-MAKING PARAMETERS FOR CITY COUNCIL, AND APPOINTED BOARDS & COMMISSIONS Adopted June 18, 2018 The City of Lake Forest Mission Statement: "Be the best-managed, fiscally-responsible and appealing community and promote a community spirit of trust, respect and citizen involvement. " The Lake Forest City Council, with the advice and recommendations of its appointed advisory Boards and Commissions, Lake Forest Citizens, and City Staff, is responsible for policy formulation and approval. Implementation of adopted strategy, policy, budgets, and other directives of Council is the responsibility of City Staff, led by the City Manager and Senior Staff. The Mayor and Aldermen, and appointed members of Boards and Commissions should address matters in a timely, deliberate, objective and process-driven manner, making decisions guided by the City of Lake Forest Strategic and Comprehensive Plans, the City's Codes, policies and procedures, and the following parameters: . Motions and votes should comprise what is in the best long-term interests of all Lake Forest citizens, measured in decades, being mindful of proven precedents and new precedents that may be created. . All points of view should be listened to and considered in making decisions with the long-term benefit to Lake Forest's general public welfare being the highest priority. . Fundmg decisions should support effectiveness and economy in providing services and programs, while mindful of the number ofcidzens benefittmg from such expenditures. . New initiatives should be quantified, qualified, and evaluated for their long-tenn merit and overall fiscal unpact and other consequences to the community. . Decision makers should be proactive and timely in addressing sto-ategic planning initiatives, external forces not under control of the City, and other opportunities and challenges to the community. Community trust in, and support of, government is fostered by maintaining the integrity of these decision-making parameters. The City of Lake Forest 's Decision-Making Parameters shall be reviewed by the City Council on an annual basis and shall be included on all agendas of the City Council and Boards and Commissions. 13 Annual Comprehensive Financial Report City of Lake Forest, Illinois For the Year Ended April 30, 2022 14 Annual Comprehensive Financial Report of the City of Lake Forest, Illinois Fiscal Year Ended April 30, 2022 City of Lake Forest Finance Department Elizabeth Holleb, Finance Director Diane Hall, Assistant Finance Director 15 City of Lake Forest Table of Contents Year Ended April 30, 2022 Page Introductory Section Transmittal Letter i Certificate of Achievement for Excellence in Financial Reporting viii Organizational Chart ix List of Principal Officials x Financial Section Independent Auditors' Report 1 Required Supplementary Information Management's Discussion and Analysis 4 Basic Financial Statements Government-W ide Financial Statements Statement of Net Position 17 Statement of Activities 19 Fund Financial Statements Balance Sheet - Governmental Funds 20 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position 22 Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds 23 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities 25 Statement of Net Position - Proprietary Funds 26 Statement of Revenues, Expenses and Changes in Net Position - Proprietary Funds 28 Statement of Cash Flows - Proprietary Funds 29 Statement of Fiduciary Net Position - Fiduciary Funds 31 Statement of Changes in Fiduciary Net Position - Fiduciary Funds 32 Index to Notes to Financial Statements 33 Notes to Financial Statements 34 16 City of Lake Forest Table of Contents April 30, 2022 Page Required Supplementary Information General Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - General Fund 83 Special Revenue Funds Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Parks and Recreation Fund 84 Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - General Cemetery Fund 85 Historical Pension and Other Postemployment Benefit Information Illinois Municipal Retirement Fund - Schedule of Changes in the City's Net Pension Liability and Related Ratios 86 Illinois Municipal Retirement Fund - Schedule of Employer Contributions 89 Police Pension Fund - Schedule of Changes in the City's Net Pension Liability and Related Ratios 90 Police Pension Fund - Schedule of Employer Contributions 91 Police Pension Fund - Schedule of Investment Returns 93 Firefighters' Pension Fund - Schedule of Changes in the City's Net Pension Liability and Related Ratios 94 Firefighters' Pension Fund - Schedule of Employer Contributions 95 Firefighters' Pension Fund - Schedule of Investment Returns 97 Other Postemployment Benefits Plan - Schedule of Changes in the City's Total OPEB Liability and Related Ratios 98 Notes to Required Supplementary Information 99 Supplementary Information Governmental Funds Combining Balance Sheet - Nonmajor Governmental Funds 100 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 102 Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Police Restricted Fund 104 Foreign Fire Insurance Tax Fund 105 Emergency Telephone Fund 106 Parks and Public Land Fund 10717 City of Lake Forest Table of Contents April 30, 2022 Page Motor Fuel Tax Fund 108 Senior Resources Commission Fund 109 Housing Trust Fund 110 Debt Service Fund 111 Laurel/W estern Redevelopment TIF Fund 112 Capital Improvements Fund 113 Enterprise Funds Schedules of Revenues, Expenses and Nonoperating Revenues (Expenses) - Budget and Actual (Budgetary Basis) Waterworks and Sewerage Fund 114 Deerpath Golf Course Fund 115 Internal Service Funds Combining Statement of Net Position 116 Combining Statement of Revenues, Expenses and Changes in Net Position 117 Combining Statement of Cash Flows 118 Schedules of Revenues, Expenses and Nonoperating Revenues - Budget and Actual (Budgetary Basis) Fleet Fund 119 Self Insurance Fund 120 Liability Insurance Fund 121 Fiduciary Funds Combining Statement of Fiduciary Net Position - Pension Trust Funds 122 Combining Statement of Changes in Fiduciary Net Position - Pension Trust Funds 123 Schedule of Changes in Fiduciary Net Position - Budget and Actual Police Pension Fund - Pension Trust Fund 124 Firefighters' Pension Fund - Pension Trust Fund 125 Other Supplementary Schedules Statement of Net Position and General Fund Balance Sheet - Discretely Presented Component Unit - Lake Forest Library 126 Statement of Activities and General Fund Statement of Revenues, Expenditures and Changes in Fund Balance - Discretely Presented Component Unit - Lake Forest Library 127 18 City of Lake Forest Table of Contents April 30, 2022 Page Summary of Debt Service Requirements to Maturity 128 Debt Service Requirements to Maturity - General Obligation Bonds 129 Special Service Area 25 Special Tax Bonds - 2003 Series 132 Special Service Area 26 Special Tax Bonds - 2003 Series 133 Special Service Area 29 Special Tax Bonds - 2004 Series 134 General Obligation Bonds - 2015 Series 135 General Obligation Bonds - 2017 Series 136 General Obligation Bonds - 2019 Series 137 General Obligation Bonds - 2021 Series 138 Combining Balance Sheet - Debt Service Fund 139 Combining Schedule of Revenues, Expenditures and Changes in Fund Balances - Debt Service Fund 141 Statistical Section Net Position by Component - Last Ten Fiscal Years 143 Change in Net Position - Last Ten Fiscal Years 144 Fund Balances of Governmental Funds - Last Ten Fiscal Years 146 Change in Fund Balances for Governmental Funds - Last Ten Fiscal Years 147 Assessed Value and Actual Value of Taxable Property - Last Ten Levy Years 148 Property Tax Rates - Direct and Overlapping Governments - Last Ten Levy Years 149 Principal Property Taxpayers - Current Year and Nine Years Ago 150 Property Tax Levies and Collections - Last Ten Levy Years 151 Tax Extensions for City Funds - Last Ten Levy Years 152 Sales Tax Base and Number of Principal Payers - Taxable Sales by Category - Home Rule Sales Tax - Last Ten Calendar Years 153 Sales Tax Base and Number of Principal Payers - Taxable Sales by Category - Municipal Sales Tax - Last Ten Calendar Years 154 Direct and Overlapping Sales Tax Rates - Last Ten Fiscal Years 155 Ratios of Outstanding Debt by Type - Last Ten Fiscal Years 156 Ratios of General Bonded Debt Outstanding - Last Ten Fiscal Years 157 Direct and Overlapping Governmental Activities Debt 158 Legal Debt Margin Information - Last Ten Fiscal Years 15919 City of Lake Forest Table of Contents April 30, 2022 Page Pledged Revenue Coverage - Last Ten Fiscal Years 160 Demographic and Economic Information - Last Ten Fiscal Years 161 Principal Employers - Current Year and Nine Years Ago 162 Full-Time Equivalent Employees - Last Ten Fiscal Years 163 Operating Indicators - Last Ten Fiscal Years 164 Capital Asset Statistics - Last Ten Fiscal Years 166 20 i October 20, 2022 The Honorable Mayor Pandaleon Members of the City Council Members of the Audit Committee Residents of the City of Lake Forest, Illinois The Annual Comprehensive Financial Report of the City of Lake Forest (City) for the year ended April 30, 2022, is hereby submitted as mandated by both local ordinances and state statutes. These ordinances and statutes require that the City issue annually a report on its financial position and activity presented in conformance with accounting principles generally accepted in the United States of America (GAAP) and audited in accordance with generally accepted auditing standards by an independent firm of certified public accountants. This report consists of management’s representations concerning the finances of the City of Lake Forest. Consequently, management assumes full responsibility for the completeness and reliability of all of the information presented in this report. To provide a reasonable basis for making these representations, management of the City has established a comprehensive internal control framework that is designed both to protect the government’s assets from loss, theft, or misuse and to compile sufficient reliable information for the preparation of the City of Lake Forest’s financial statements in conformity with GAAP. Because the cost of internal controls should not outweigh their benefits, the City’s comprehensive framework of internal controls has been designed to provide reasonable rather than absolute assurance that the financial statements will be free from material misstatement. As management, we assert that, to the best of our knowledge and belief, this financial report is complete and reliable in all material respects. The City of Lake Forest utilizes an independent Audit Committee for reviewing the audit process and to report and make recommendations to the City Council. The Audit Committee members are Lake Forest residents having expertise in the area of financial administration and auditing. The City’s financial statements have been audited by Baker Tilly US, LLP, a firm of licensed certified public accountants. The goal of the independent audit is to provide reasonable assurance that the financial statements of the City of Lake Forest for the fiscal year ended April 30, 2022, are free of material misstatement. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessing the accounting principles used and significant estimates made by management; and evaluating the overall financial statement presentation. The independent auditor concluded, based upon their audit, that there was a reasonable basis for an unmodified opinion that the City’s financial statements for the fiscal year ended April 30, 2022, are fairly presented in conformity with GAAP. The independent auditors’ report is presented as the first component of the financial section of this report. GAAP requires that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The City’s MD&A is located immediately following the report of the independent auditors. 21 ii Profile of The City of Lake Forest The City of Lake Forest was incorporated as a city under a charter granted by the Illinois State Legislature in 1861 and amended in 1869. Lake Forest is a residential community of 19,375 people and has a land area of 17.18 square miles. It is situated on Lake Michigan, thirty miles north of downtown Chicago in Lake County. In its American Community Survey, 2016-2020 estimates, the U.S. Census Bureau reported the City had a median household income and median home value significantly higher than comparable figures for Lake County and the State of Illinois: The City adopted the Council-Manager form of government in 1956. Policy making and legislative authority are vested in the City Council, which consists of a Mayor and an eight-member Council. The City Council is responsible, among other things, for passing ordinances, adopting the budget, appointing committees, and hiring the City Manager and City Attorney. The City Manager is responsible for carrying out the policies and ordinances of the City Council, for overseeing the day-to-day operations of the City, and for hiring the heads of the City's departments. The Council members are elected to two-year staggered terms with one alderman from each ward elected annually. Aldermen serve a maximum of three terms. The Mayor is elected to a two- year term and serves a maximum of two terms. The City provides a full range of services, including police protection, fire protection, paramedic service, refuse disposal, commuter parking, compost center, recreation center, senior center, community parks, golf course, street maintenance, forestry, cemetery and a water production facility. The financial reporting entity of The City of Lake Forest includes all City funds as well as its component unit, the Lake Forest Library. Component units are legally separate entities for which the primary government is financially accountable. Each year the City of Lake Forest prepares an annual budget document. This plan contains the following sections: the budget message and fiscal policy; summary tables of revenues, expenditures, and fund balance for the fiscal year; operating budgets for each department; pay plan and personnel data; and debt and statistical information. The budget message highlights the significant expenditure events that will occur and the objectives to accomplish these events. It justifies the planned capital expenditures and also lists the goals that are to be achieved during the budget year. While the annual municipal budget represents the City's financial plan for expenditures over the course of the fiscal year, the annual Appropriation Ordinance is the formal legal mechanism by which the City Council authorizes the actual expenditure of funds budgeted in the annual budget. It appropriates specific sums of money by object and purpose of expenditure. In addition, the Appropriation Ordinance provides for a 10% contingency above those expenditures actually budgeted. Each separate fund includes an item labeled contingency, with an appropriated amount equivalent to 10% of the total funds budgeted. Even though there is a 10% contingency line item, the City 189,013 858,600 92,654 281,000 68,428 217,400 0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000 1,000,000 Median Household Income Median Home Value Lake Forest Lake County Illinois 22 iii Council and City staff follow the adopted budget as its spending guideline and not the Appropriation Ordinance. This practice has been followed for more than thirty years and has worked very efficiently as a mechanism to address unanticipated items that may arise throughout the fiscal year. Budget-to-actual comparisons are provided for each individual governmental fund for which an appropriated annual budget has been adopted. For the General Fund, Parks and Recreation Fund and General Cemetery Fund, considered major funds, this comparison is presented as required supplementary information. For the Capital Improvements Fund (major fund), Debt Service Fund (non-major fund) and non-major special revenue funds with appropriated annual budgets, this comparison is presented in the Other Supplementary Information section of this report. Factors Affecting Financial Condition Local Economy. The City of Lake Forest is not immune to challenges brought on by national and state economic conditions but has been proactive in identifying mitigation strategies. • Unemployment levels in Lake Forest are well below the levels for Lake County and the State of Illinois. For calendar year 2021, the City’s annual average unemployment rate was estimated to be 3.8%, compared to 5.3% for Lake County and 6.1% for the State of Illinois. • The consumer confidence index is closely monitored by economists because consumer spending accounts for 70% of the United States’ economic activity. In August 2022, the index was 103.2, up from 95.3 in July, and comparing unfavorably to the August 2021 index of 115.2. The index remains above 90, the minimum level associated with a healthy economy. An index above 100 signals growth. As revenues declined in 2008-2010 due to national economic conditions, the City has proactively reduced operating expenses to ensure a balanced budget and compliance with the City’s fiscal policies. Since personnel costs represent approximately 73.35% of the General Fund operating budget, it has been necessary to achieve cost savings through reduced personnel. In fiscal years (FY) 2004-2023, the City has reduced budgeted full time employees by 46 positions (17.6%), returning the City’s total employee count below FY1992 levels. In February 2011, the City Council approved an organizational restructuring and Early Retirement Incentive (ERI) program which is offered and regulated by the Illinois Municipal Retirement Fund (IMRF). Twenty-six (26) employees participated in the ERI program, which was projected to generate net savings of $4.5 million over the initial ten year period. In December 2012, the City Council approved the use of excess fund balance reserves to pay off the ERI liability in its entirety, rather than amortizing over ten years as initially anticipated. This early payoff allowed the City to avoid $1.8 million in interest costs over the amortization period. In September 2014, the City transitioned to a consolidated dispatch operation with the Villages of Glenview and Lake Bluff, as well as the City of Highland Park. The consolidation of dispatch operations resulted in the reduction of ten (10) full-time positions and is saving the City more than $350,000 per year while improving the infrastructure providing this vital service to residents. Approximately half of the City’s General Fund revenues come from property taxes, which continue to be a stable revenue source. The other major funding sources of sales tax, income tax, utility taxes and building permit revenues met FY2022 budget estimates in aggregate. Effective May 1, 2014, the City implemented a new sanitation fee that generates $930,000 per year. This revenue is currently deposited to the General Fund. Effective May 1, 2017, the City implemented a new Public Safety Pension Fee to increase public awareness of the challenges in meeting police and fire pension obligations. Effective July 1, 2019, the City increased the Home Rule Sales tax from .5% to 1% to fund capital improvement projects. The financial condition of the State of Illinois continues to be a significant concern although the City has taken measures to limit its reliance on the State for direct funding. The City is vigilant in monitoring legislation that may be introduced that could have a negative impact on the City’s budget and vigorously opposes such legislation. In recent years, the State had reduced income tax distributions and imposed an 23 iv administration fee of 2% on home rule sales tax collections (reduced to 1.5% for SFY19). The State has returned to 100% funding of the City’s portion of income tax distributions, which has been incorporated into the FY23 budget. The City Council and staff continue to budget conservatively and discuss fiscal scenarios for future years should the State continue to tap local revenues to balance its budget or in the event the State imposes property tax limitations on local units of government. In order to assist the business community and enhance sales tax revenues, economic development initiatives are conducted through the Community Development Department. The City works with the Lake Forest/Lake Bluff Chamber of Commerce and representatives of the business districts in Lake Forest. The City is committed to attracting desired businesses and to promote the viability of the business districts. In an effort to proactively address budgetary issues that may arise throughout the year, City staff monitors revenues and expenses on a monthly basis. Monthly financial “flash” reports are provided to the City Council Finance Committee. In addition, the City follows the fiscal policy approved annually by the City Council. The Fiscal Policy is designed to establish guidelines for the fiscal stability of the City and to provide guidelines for the City’s chief executive officer, the City Manager. Effective fiscal policy: • Contributes significantly to the City’s ability to insulate itself from fiscal crisis, • Enhances short-term and long-term financial credit ability by helping to achieve the highest credit and bond ratings possible, • Promotes long-term financial stability by establishing clear and consistent guidelines, • Directs attention to the total financial picture of the City rather than single issue areas, • Promotes the view of linking long-term financial planning with day-to-day operations, and • Provides the Council and the citizens a framework for measuring the fiscal impact of government services against established fiscal parameters and guidelines. In Fiscal Year 2016, the City Council adopted revisions to the Fiscal Policy effective for FY2017 and continuing through FY2022. The revised policy clarified the applicability of the Property Tax Extension Limitation Law to the City, established a policy for setting aside reserves to meet the City’s Other Post- Employment Benefits (OPEB) liability, revised the financing parameters for establishment of Special Service Areas, and committed to minimizing reliance on State and/or Federal revenues to fund core services. In March 2020, the world was dramatically affected by the COVID-19 pandemic. While the General Fund revenues were not greatly affected by COVID-19, other areas of the City were significantly impacted. The City budgeted reduced sales tax and income tax revenue for FY2021. Both sales tax and income tax exceeded FY21 budget projections. The Police and Fire Pension investments resulted in larger losses as of April 30, 2020. Investments rebounded in FY21, resulting in returns in excess of 25%. The City’s Parks and Recreation programs were placed on hold in March 2020 resulting in the cancellation of many of the spring and summer programs reducing the revenue of the fund. Programs remained at reduced capacities throughout FY21. The Parks and Recreation Fund improved in FY2022, as programs returned with greater capacities. The City’s golf course was shut down in March 2020 and was able to open at a limited capacity as of May 1. A revised FY21 preliminary budget was presented to the City for approval, reflecting changes based on anticipated reductions in consumer driven revenue. The Golf Course thrived by offering outside services for residents. The City continues to seek grant opportunities to assist with the financial impact of the pandemic. The City successfully applied for CARES funding and received $899,471, through Lake County. The City has been awarded $2.6 million in America Rescue Plan Act (ARPA) funds to be received in FY22 and FY23. To date, the City has received $227,899 in Federal Emergency Management Agency (FEMA) funding to assist with COVID-19 expenses. Long–Term Financial Planning. The City is funding infrastructure expenditures primarily on a pay-as- you-go basis from dedicated revenues. A real estate transfer tax is imposed on residential and commercial real estate transactions and is deposited into the Capital Improvements Fund. The transfer tax of $4.00 per $1,000 of value is levied on the buyer of the real estate. FY2022 real estate transfer tax revenue totaled $2.6 million, which is $1.2 million over budget. Significant fluctuations occur in this revenue source due to 24 v changes in economic conditions, and more specifically the housing market. The City will remain conservative in projecting this revenue source and in spending monies on capital projects. In FY2017, the City took advantage of one-time proceeds from the sale of City property to call general obligation bonds issued in 2008. To provide an additional annual funding source for the Capital Improvement Program, the City Council approved the creation of a Capital Improvements property tax levy that would mirror the debt service maturities associated with the 2008 bonds. Beginning in FY2018, this measure provided an additional $820,000 to the Capital Improvements Fund. In FY2019, the City Council approved an increase to the Sanitation fee effective May 1, 2019. This measure provided an additional $300,000 in funding. The City Council approved moving the Sanitation fee to the General Fund beginning in FY2020 to align the revenue with the Sanitation Division operating expenses. The Capital Fund Tax Levy has been increased for the Capital Improvement Fund to account for the Sanitation fees moved to the General Fund. The City Council also approved an increase to the City’s Home Rule Sales tax from .5% to 1% effective July 1, 2019 to fund capital improvements. A Public Works Committee consisting of three City Council members was created to oversee capital improvement projects and programs. Annually in October, the Public Works Committee and city staff finalize the draft of the Five Year Capital Improvement Program. This draft is discussed at a City Council Finance Committee budget meeting, typically held in November. Five-year fund balance forecasts are prepared for major funds of the City each year as part of the budget development process to assist the City in identifying budget challenges on the horizon and ensure that a proactive approach is taken to address these challenges. In recent years, a ten-year forecast has been developed for the General Fund. Pension Benefits. Escalating costs for employee pension benefits will continue to pose financial challenges to the City. Sworn police and fire personnel receive retirement and disability benefits from the Police Pension Fund and Firefighters’ Pension Fund, respectively. Both of these plans are defined benefit, single-employer plans administered by boards of trustees. The defined benefits and employee contribution levels are governed by Illinois Compiled Statutes and may only be amended by the Illinois General Assembly. Police participants are required to contribute 9.91% of their base salaries and fire participants are required to contribute 9.455% of their base salaries. The City is required to contribute the remaining amounts necessary to finance each plan as determined by an independent actuary. As of April 30, 2022, the most recent actuarial valuation date, the funded ratio for the Police Pension Plan is 56.4% and for the Firefighters’ Pension Plan is 70.39%. Funding ratios were negatively impacted by investment returns of - 1.89% for the Police Pension Fund and -5.19% for the Firefighters’ Pension Fund in FY22. All other employees of the City who work over 1,000 hours per year are covered by the Illinois Municipal Retirement Fund (IMRF), a statewide pension plan. Benefit provisions and funding requirements are established by State statutes and may only be changed by the Illinois General Assembly. Employees participating are required to contribute 4.5% of their annual wages and the City is required to contribute the remaining amounts necessary to fund the coverage of its employees in the plan. As of December 31, 2021 due to a 2021 investment return of 16.6%, the funded ratio for IMRF is 113.47%, including the actuarial accrued liability for retirees which is 100% funded. In early 2010, a bill was signed by the Governor with an effective date of January 1, 2011, approving a "two- tier" system, where current employees keep their existing pension plans, but new hires will join a less expensive new system. IMRF was included in the bill but not the Police and Firefighters’ pension plans. By the end of 2010, the Illinois General Assembly approved police and firefighter pension reform legislation effective January 1, 2011. The law does not affect the pensions of all employed police officers and firefighters - only those hired after January 1, 2011. Although cost savings from both bills will not be seen immediately, it does provide the City long-term financial relief. Implementation of GASB Statement No. 67, Financial Reporting for Pension Plans, for Fiscal Year 2015 and No. 68, Accounting and Financial Reporting for Pensions, for Fiscal Year 2016 has resulted in significant changes to the reporting of pension obligations in the City’s financial statements. In anticipation 25 vi of these statements taking effect, the City made adjustments to the mortality table and interest rate assumptions for its police and fire pension fund actuarial valuations. These changes reduced the funded ratio of the plans but were intended to put the City in an even stronger position going forward. These changes are in addition to historically overfunding the annual pension cost compared to minimum requirements per State Statutes. The City Council has continued deliberations on the funding of public safety pensions with the support of staff, the fire and police pension boards, and the City’s independent actuary. Significant changes to actuarial assumptions were made for the April 30, 2017 actuarial valuations, increasing the funding requirement for FY2019 by a combined $800,000 and additional $190,000 in FY2020. The City Council approved a FY2021 transfer of $500,000 to each pension fund from FY2020 General Fund excess fund balance to provide additional funding. A public safety pension fee was implemented effective May 1, 2017 as noted previously. A pension subcommittee established by the Mayor continues to discuss alternatives for future consideration by the City Council. Post-Retirement Benefits. The City provides post-employment health care benefits to retirees and eligible dependents. Rising health care cost continue to pose financial challenges to the City. Implementation of GASB Statement No. 75, Accounting and Financial Report for Postemployment Benefits Other Than Pensions, for FY2019 has resulted in significant changes to the reporting of post-employment obligations in the City’s financial statements. In anticipation of these statements, the City made adjustments to the City’s health plan by moving retirees over the age of 65 to a separate medical plan. These changes reduced the City’s outstanding obligation. Additional information on the City’s pension obligations, as well as other postemployment benefits, may be found in Note 4 of the financial statements, as well as in the Required Supplementary Information. Major Initiatives The City is committed to maintaining the quality of life and preserving the character and heritage of Lake Forest. The City will continue to adhere to its prudent financial management practices and remain focused on sustaining long-term financial stability. For FY2022, the most significant initiatives were as follows: • In January 2015, the City Council approved ordinances adopting a Tax Increment Financing (TIF) District on a 10-acre site at the north end of the Commercial Business District. In FY2016, the City completed required demolition of existing structures and remediation of the site. In April 2016, the City Council approved a First Amendment to the Purchase/Sale Agreement, redevelopment agreement, final plat of subdivision and Final Development Planned Development Ordinance. The plan includes 165 total units – 12 single family homes, 42 condominium units and 111 apartments. As of April 30, 2022 construction of the three apartment buildings is complete and fully occupied. The first of the two condominiums are complete with all 24 units sold. Construction of the second building has not started. Seven single family homes have been sold and permits for two additional homes have been issued. In FY22, the first Note payment of $500,000 from Tax Increment proceeds for the sale of the property to a developer was made. • In March 2021, the City Council authorized $1.1 million to improve Ringwood Ravine. • In August 2021, the City Council authorized $336,000 to improve Veterans Park. • In September 2021, the City issued General Obligation (GO) Refunding Bonds, Series 2021 to refinance 2013 GO Bonds. Savings over the life of the bonds will exceed $1.6 million. • In September 2021, the City received the first of two payments from the American Rescue Plan Act. The City will receive a total of $2.6 million to fund a qualifying storm sewer project. • In October 2021, the Ragdale Foundation donated in excess of two acres to the City to enhance the Ragdale campus. 26 vii • Public Act 101-0610, effective January 1, 2020, mandates the consolidation of investment assets for all local police and fire pension funds for investment purposes only. In November 2021, the City’s Fire Pension Board transferred its investment assets to the consolidated fire investment fund. A similar transfer of Police Pension Fund investment assets was completed in June 2022. • In March and July 2022, the City Council authorized transferring from FY2022 General Fund surplus, $1,000,000 to the Parks and Public Land Fund, $500,000 to the Housing Trust Fund, $650,000 to the Self Insurance Fund and $3,400,000 to the Capital Improvement Fund for future projects. Awards and Acknowledgements The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to The City of Lake Forest for its annual comprehensive financial report for the fiscal year ended April 30, 2021. This was the 43rd consecutive year that the City of Lake Forest has achieved this prestigious award. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized annual comprehensive financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe that our current annual comprehensive financial report continues to meet the Certificate of Achievement Program's requirements and we are submitting it to the GFOA to determine its eligibility for another certificate. We would like to express our appreciation to all members of the Finance Department who assisted and contributed to the preparation of this report. We would also like to thank the Mayor, members of the City Council and the Audit Committee for their interest and support in planning and conducting the financial operations of the City in a responsible and progressive manner. Respectfully submitted, Jason Wicha Elizabeth A. Holleb City Manager Finance Director 27 viii 28 Voters and Residents of The City of Lake Forest Mayor and City Council Office of the City Manager Community Development CROYA Finance Fire Human Resources Innovation & Technology Parks & Recreation Police Public Works Senior Center APPOINTED BOARDS, COMMISSION, COMMITTEES •Audit Committee •Board of Fire and Police Commissioners •Board of Trustees – Firefighter Pension Fund •Board of Trustees –Police Pension Fund •Building Review Board •Cemetery Commission •Construction Codes Commission •CROYA Board •Historic Preservation Commission •Housing Trust Fund Board •Legal Committee •Library Board •Parks and Recreation Board •Plan Commission •Senior Resources Commission •Zoning Board of Appeals ix 29 x List of Principal Officials Year Ended April 30, 2022 LEGISLATIVE City Council George Pandaleon, Mayor Jennifer Karras Melanie Rummel James E. Morris Ted Notz Jim Preschlack Ara Goshgarian Raymond P. Buschmann Eileen Weber AUDIT COMMITTEE Vince Sparrow, Chairman Tighe Magnuson William McFadden Mark Dillon Tara Janos George Pandaleon, Mayor (ex-officio) James E. Morris, Finance Committee Chairman (ex-officio) EXECUTIVE Jason Wicha, City Manager DEPARTMENT OF FINANCE Elizabeth Holleb, Director of Finance Diane Hall, Assistant Finance Director 30 Baker Tilly US, LLP, trading as Baker Tilly, is a member of the global network of Baker Tilly International Ltd., the members of which are separate and independent legal entities. © 2020 Baker Tilly US, LLP Independent Auditors' Report To the Honorable Mayor and City Council of City of Lake Forest, Illinois Report on the Audit of the Financial Statements Opinions We have audited the accompanying financial statements of the governmental activities, the business-type activities, the discretely presented component unit, each major fund and the remaining fund information of the City of Lake Forest, Illinois (the City), as of and for the year ended April 30, 2022, and the related notes to the financial statements, which collectively comprise the City's basic financial statements as listed in the table of contents. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, the discretely presented component unit, each major fund and the remaining fund information of the City as of April 30, 2022 and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinions We conducted our audit in accordance with auditing standards generally accepted in the United States of Am erica (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States (GAS). Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. W e believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. The financial statements of Lake Forest Library were not audited in accordance with Government Auditing Standards. Responsibilities of Management for the Financial Statements Managem ent is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America; and for the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that rise substantial doubt about the City's ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter. 1 31 Auditors' Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS and GAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with GAAS and GAS, we: Exercise professional judgment and maintain professional skepticism throughout the audit. Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly, no such opinion is expressed. Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City's ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings and certain internal control-related matters that we identified during the audit. Required Supplementary Information Accounting principles generally accepted in the United States of America require that the required supplementary information as listed in the table of contents be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic or historical context. W e have applied certain lim ited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. W e do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. 2 32 Supplementary Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City's basic financial statements. The supplementary information as listed in the table of contents is presented for purposes of additional analysis and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the supplementary information is fairly stated in all material respects, in relation to the basic financial statements as a whole. Other Information Management is responsible for the other information included in the annual report. The other information comprises the introductory section and statistical section as listed in the table of contents but does not include the basic financial statements and our auditors' report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon. In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated October 20, 2022 on our consideration of the City's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City's internal control over financial reporting and compliance. Oak Brook, Illinois October 20, 2022 3 33 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UN AUDITED) APRIL 30, 2022 4 The City of Lake Forest’s (the City) management’s discussion and analysis is designed to (1) assist the reader in focusing on significant financial issues, (2) provide an overview of the City’s financial activity, (3) identify changes in the City’s financial position (its ability to address the next and subsequent year’s challenges), (4) identify any material deviations from the financial plan (the approved budget), and (5) identify individual fund issues or concerns. Since the Management’s Discussion and Analysis (MD&A) is designed to focus on the current year’s activities, resulting changes and currently known facts, please read it in conjunction with the Transmittal Letter and the City’s financial statements. Financial Highlights • The City’s net position increased $18.3 million for the fiscal year ending April 30, 2022 (FY22). Governmental net position increased $15.3 million and business-type net position increased $3 million. • The governmental activities revenue increased by $4.1 million (6.6%) due to increased taxes, capital grants/contributions, charges for services and intergovernmental taxes, offset by decreases to investment income. The expenses increased by $.7 million (1.4 %) due primarily to adjustments related to pensions and reduced expenses. • The business-type activities revenue increased by $1.8 million (1.7%) primarily due to an increase in charges for services in the Water and Sewer Fund. The City’s business-type activity expenses decreased by $.9 million (9.4%) due primarily to pension adjustments and non-capitalized improvements. • The total cost of all City programs decreased from $60.5 million in FY21 to $60.3 million in FY22 – a decrease of $.2 million or .1% - attributable to decreased expenses, pension adjustments and non- capitalized improvements. USING THE FINANCIAL SECTION OF THE ANNUAL COMPREHENSIVE REPORT The financial statement’s focus is on both the City as a whole (government-wide) and on the major individual funds. Both perspectives (government-wide and major fund) allow the user to address relevant questions, broaden a basis for comparison (year to year or government to government) and enhance the City’s accountability. Government-Wide Financial Statements The government-wide financial statements are designed to be corporate-like in that all governmental and business-type activities are consolidated into columns which add to a total for the Primary Government. The Statement of Net Position is designed to be similar to bottom line results for the City and its governmental and business-type activities. This statement combines and consolidates governmental fund’s current financial resources (short-term spendable resources) with capital assets and long term obligations using the accrual basis of accounting and economic resources measurement focus. The Statement of Activities is focused on both the gross and net cost of various activities (including governmental and business-type), which are supported by the government’s general taxes and other resources. This is intended to summarize and simplify the user’s analysis of the cost of various governmental services and/or subsidy to various business-type activities. The Governmental Activities reflect the City’s basic services, including highways and streets, sanitation, culture and recreation, public safety, and general government. Property taxes, sales tax, income taxes and local utility taxes finance the majority of these services. The Business-type Activities reflect private sector type operations (Waterworks and Sewerage, Golf) where the fee for service is intended to cover all or most of the costs of operation, including depreciation. 34 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UN AUDITED) APRIL 30, 2022 5 Fund Financial Statements Traditional users of governmental financial statements will find the Fund Financial Statements presentation more familiar. The focus is on Major Funds, rather than fund types. The Governmental Major Funds presentation is presented on a sources and uses of liquid resources basis. This is the manner in which the financial plan (the budget) is typically developed. The flow and availability of liquid resources is a clear and appropriate focus of any analysis of a government. Funds are established for various purposes and the Fund Financial Statement allows the demonstration of sources and uses and/or budgeting compliance associated therewith. The Fund Financial Statements also allow the government to address its Fiduciary Funds (Police Pension, Firefighters’ Pension and Cemetery Trust Funds). While these Funds represent trust responsibilities of the government, these assets are restricted in purpose and do not represent discretionary assets of the government. Therefore, these assets are not presented as part of the Government-Wide Financial Statements. While the Business-type Activities total column on the Business-type Fund Financial Statements is essentially the same as the Business-type column on the Government-Wide Financial Statement, the Governmental Major Funds Total column requires a reconciliation because of the different measurement focus (current financial resources versus total economic resources) which is reflected on the page following each statement. The flow of current financial resources will reflect debt proceeds and inter-fund transfers as other financing sources as well as capital expenditures and debt principal payments as expenditures. The reconciliation will eliminate these transactions and incorporate the capital assets and long-term obligations (bonds and others) into the Governmental Activities column (in the Government-wide statements). Infrastructure Assets Historically, a government’s largest group of assets (infrastructure – roads, bridges, storm sewers, etc.) was not reported nor depreciated in governmental financial statements. Generally accepted accounting principles now require that these assets be valued and reported within the Governmental Activities column of the government-wide statements. Additionally, the government must elect to either (1) depreciate these assets over their estimated useful life or (2) develop a system of asset management designed to maintain the service delivery potential to near perpetuity. If the government develops the asset management system (the modified approach) which periodically (at least every third year) by category measures and demonstrates its maintenance of locally established levels of service standards, the government may record its cost of maintenance in lieu of depreciation. The City has chosen to depreciate assets over their useful life. If a road project is considered maintenance – a recurring cost that does not extend the road’s original useful life or expand its capacity – the cost of the project will be expensed. An “overlay” of a road will be considered maintenance whereas a “rebuild” of a road will be capitalized. GOVERNMENT-WIDE STATEMENT Statement of Net Position The City’s combined net position increased by $18.3 million for FY22 – from $235.6 million to $253.9 million. The analysis following will look at net position and net expenses of governmental and business-type activities separately. The total net position for the governmental activities increased by $15.3 million – from $186.6 million to $201.9 million. The business-type activities net position increased by $3.0 million – from $49.0 million to $52.0 million. Table 1 reflects the condensed Statement of Net Position compared to FY21. Table 2 will focus on the changes in net position of the governmental and business-type activities. 35 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UN AUDITED) APRIL 30, 2022 6 Table 1 Statement of Net Position As of April 30, 2021 and 2022 (in millions) Governmental Business- Type Total Primary Activities Activities Government 2021 2022 2021 2022 2021 2022 Current and Other Assets $117.8 $140.2 $13.5 $16.5 $131.3 $156.6 Capital Assets 193.2 192.0 52.9 51.3 246.1 243.4 Total Assets 311.0 332.2 66.4 67.8 377.4 400.0 Deferred Outflows 10.1 8.5 0.2 0.3 10.3 8.8 Long- Term Liabilities 76.7 83.0 15.2 13.2 91.9 96.2 Other Liabilities 7.8 9.7 1.0 0.8 8.8 10.5 Total Liabilities 84.5 92.7 16.2 14.0 100.7 106.7 Deferred Inflows 50.0 46.1 1.3 2.1 51.3 48.2 Net Position: Net Investment in Capital Assets 164.8 165.8 38.1 38.6 202.9 204.4 Restricted 36.5 57.7 0.6 2.0 37.1 59.7 Unrestricted (14.7) (21.6) 10.3 11.4 (4.4) (10.2) Total Net Position $186.6 $201.9 $49.0 $52.0 $235.6 $253.9 For more detailed information see the Statement of Net Position. Normal Impacts There are six basic (normal) transactions that will affect the comparability of the Statement of Net Position summary presentation. Net Results of Activities will impact (increase/decrease) current assets and unrestricted net position. Borrowing for Capital will increase current assets and long-term debt. Spending Borrowed Proceeds on New Capital will reduce current assets and increase capital assets. There is a second impact, an increase in capital assets and an increase in related net debt which will not change the net investment in capital assets. Spending of Non-borrowed Current Assets on New Capital will (a) reduce current assets and increase capital assets and (b) will reduce unrestricted net position and increase net investment in capital assets. Principal Payment on Debt will (a) reduce current assets and reduce long-term debt; and (b) reduce unrestricted net position and increase net investment in capital assets. 36 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2022 7 Reduction of Capital Assets through Depreciation will reduce capital assets and net investment in capital assets. Current Year Impacts The City’s $18.3 million increase in combined net position (which is the City’s bottom line) was the result of the governmental activities net position increasing by $15.3 million and the business-type activities net position increasing by $3.0 million. The governmental activities total assets increased by $21.2 million (6.8%) and the governmental activities total liabilities increased by $8.2 million (9.7%). With the implementation of GASB Statement No. 68, Accounting and Financial Reporting for Pensions and GASB Statement No. 75, Accounting and Financial Report for Postemployment Benefits Other Than Pensions long-term liabilities now include the net pension liability and OPEB liability previously only disclosed in the notes to the financial statements. The increase in total assets is primarily due to available cash balances and net pension assets. The increase in total liabilities is due primarily to increases in long term obligations relating to pension liabilities. See additional information in the Long-Term Obligations and Employees’ Retirement System sections of the Notes to Financial Statements and the Debt Outstanding section of the MD&A. The decrease in deferred outflows of $1.6 million related to pensions, and a decrease in deferred inflows of $3.9 million related to pensions, OPEB and an increase in property taxes levied for future periods. Net investment in capital assets increased by $1.0 million (>.1%) due to donation of land to the City and the pay down of G.O. Bonds that funded the capital assets. Restricted net position increased $21.2 million largely due to excess fund balance from the General Fund transferred to the Capital Improvement Fund and Parks and Public Land Fund to fund current year capital improvements ($5.6 million) and restricted net positions related to employee retirements ($12.8 million). Unrestricted net position decreased by $6.9 million primarily due to the net effect of GASB 68 reporting of pension liabilities and GASB 75 reporting of OPEB liabilities. The net position of business-type activities increased by $3.0 million, from $49.0 million to $52.0 million. The primary change in assets of the business-type activities was an increase in capital assets and an increase in restricted net position for employee retirements. Long-term liabilities decreased by $2.0 million due to scheduled maturities of debt obligations. Net investment in capital assets increased by $.5 million due to bond-funded capital improvements, restricted net position increased by $1.4 million and unrestricted net position increased by $1.1 million. The majority of the unrestricted net position can be used by the City to finance water and sanitary sewer operations. The City has a policy of maintaining 33% of revenue plus one year’s debt service plus $500,000 as a reserve in its water fund. The annual operating cost for this program is approximately $7.7 million per year and interest expense on bonds is $.5 million. Changes in Net Position The City’s combined change in net position was an increase of $18.3 million in FY22. The City’s total revenues increased by $5.9 million, primarily driven by increased property taxes and intergovernmental taxes. The City’s cost of all programs decreased by $.2 million, largely attributable to pension adjustments, as well as non-capitalized improvements. The chart on the following page compares the revenue and expenses for the current and previous fiscal year. 37 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UN AUDITED) APRIL 30, 2022 8 2021 2022 2021 2022 2021 2022 REVENUE Program Revenue Charges for Services $11.5 $13.9 $10.4 $11.5 $21.9 $25.4 Grants and Contributions Operating 1.1 1.2 0.0 0.0 1.1 1.2 Capital 0.8 2.4 0.0 0.6 0.8 3.0 General Revenue Property Taxes 30.4 32.1 30.4 32.1 Other Taxes 6.3 7.4 6.3 7.4 Intergovernmental - Taxes 6.9 8.1 6.9 8.1 Interest Revenue 3.6 (0.9) 0.1 0.1 3.7 (0.8) Other 1.3 1.8 0.3 0.4 1.6 2.2 Total Revenue 61.9 66.0 10.8 12.6 72.7 78.6 EXPENSES Governmental Activities General Government 12.9 11.2 12.9 11.2 Highways and Streets 7.5 6.9 7.5 6.9 Sanitation 2.4 1.9 2.4 1.9 Culture and Recreation 9.5 9.2 9.5 9.2 Public Safety 16.8 20.6 16.8 20.6 Interest 0.9 0.9 0.9 0.9 Business-Type Activities Water and Sewer 8.5 7.4 8.5 7.4 Golf 2.0 2.2 2.0 2.2 Total Expenses 50.0 50.7 10.5 9.6 60.5 60.3 Excess before Transfers 11.9 15.3 0.3 3.0 12.2 18.3 Transfers In (out)0.0 0.0 0.0 0.0 0.0 0.0 Change in Net Position 11.9 15.3 0.3 3.0 12.2 18.3 Net Position - Beginning 174.7 186.6 48.7 49.0 223.4 235.6 Net Position - Ending $186.6 $201.9 $49.0 $52.0 $235.6 $253.9 Activities Business-Type Activities Total Primary Government Table 2 Changes in Net Position For the Fiscal Year Ended April 30, 2021 and 2022 (in millions) Governmental 38 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UN AUDITED) APRIL 30, 2022 9 Property Tax 49% Sales Tax 5% Income Tax 5% Utility Tax 4% Real Estate Transfer Tax 4% Charges for Services 19%Grants 3% Other 5% Inv Income 6% FY2021 Governmental Activities Revenue Property Tax 49% Sales Tax 7% Income Tax 6% Utility Tax 4% Real Estate Transfer Tax 4% Charges for Services 21%Grants 5% Other 5%Inv Income -1% FY2022 Governmental Activities Revenue 39 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UN AUDITED) APRIL 30, 2022 10 General Government 26% Highways and Streets 15% Sanitation 4% Culture and Recreation 19% Public Safety 34%Interest on LT Debt 2% FY2021 Governmental Activities Expenses General Government 22% Highways and Streets 14% Sanitation 4%Culture and Recreation 18% Public Safety 40% Interest on LT Debt 2% FY2022 Governmental Activities Expenses 40 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2022 11 Normal Impacts There are eight basic impacts on revenues and expenses as reflected below. Revenues Economic Condition can reflect a declining, stable, or growing economic environment and has a substantial impact on state income, sales, and utility tax revenue as well as public spending habits for building permits, elective user fees and volumes of consumption. Increase/Decrease in City approved rates – while certain tax rates are set by statute, the City Council has authority to impose and periodically increase/decrease rates (water, sewer, building fees, etc.). Changing Patterns in Intergovernmental and Grant Revenue (both recurring and non-recurring) – certain recurring revenues (state shared revenues, etc.) may experience significant changes periodically while non-recurring (or one-time) grants are less predictable and often distorting in their impact on year to year comparisons. Market Impacts on Investment income – investment income on the City’s investment portfolio may fluctuate based on market conditions. Expenses Introduction of New Programs – within the functional expense categories (Public Safety, Highways and Streets, General Government, etc.), individual programs may be added or deleted to meet changing community needs. Increase/Decrease in Authorized Personnel – changes in service demand may cause the City Council to increase/decrease authorized staffing. Staffing costs (salary and related benefits) represent nearly 70% of the City’s general fund operating costs. Salary Increases (annual adjustments and merit) – the ability to attract and retain human and intellectual resources requires the City to strive to approach a competitive salary range position in the marketplace. Inflation – while overall inflation appears to be reasonably modest, the City is a major consumer of certain commodities such as supplies, fuels and parts. Some functions may experience unusual commodity specific increases. Current Year Impacts Governmental Activities Revenue For the fiscal year ended April 30, 2022, revenues from governmental activities totaled $66.0 million, increasing $4.1 million compared to FY21. The primary changes occurred in Property Taxes (up $1.7 million), Charges for Services (up $2.4 million), Grants and Contributions (up $1.7 million), Sales Taxes (up $1.5 million), Income Taxes (up $.6 million), Interest Revenue (down $4.5 million), Other Taxes (up $.6 million) and coronavirus relief funds (down $.3 million). The increase in Charges for Services was largely due to the reinstatement of Recreation programs cancelled in FY21 due to COVID-19 and Cemetery lot sales. Sales Taxes increase was due primarily to recovery from the pandemic’s effect on business operations. Investment income decreased due to losses on investments. Property tax revenue continues to be the City’s single largest revenue source, contributing $32.1 million (48.6 %) of governmental activities revenue. Property tax revenues combined with sales tax, the local utility tax, shared state income tax and real estate transfer tax revenues total $45.9 million and represent 69% of the total governmental activities’ revenue. 41 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UN AUDITED) APRIL 30, 2022 12 The real estate transfer tax became effective July 5, 2006, with voter approval via referendum. The tax is imposed upon buyers of any residential or commercial real estate at a rate of $4.00 per $1,000 of value. The revenue is used strictly to improve the City’s infrastructure. The City’s 2021 equalized assessed valuation decreased .1% compared to the prior year and totaled $2,381,873,010. Although the City became a home rule municipality in November 2004, the City has historically self-imposed the Illinois Property Tax Extension Limitation Laws (PTELL), otherwise known as the tax cap, to the extent possible. The increase of approximately 5.5% over FY21 in property taxes was generated as a result of the City Council adopting a 3.97% increase in the levy and new growth. The City received $1.3 million from the Laurel/Western Redevelopment TIF District, which are not included in the City Council approved tax levy. While the tax cap applicable to this levy was 2.3%, the levies for debt service, Police and Fire Pensions and capital improvements combined exceeded the tax cap. Investment income decreased by $4.5 million, from $3.6 million to $-.9 million. The City’s strategy for investing did not change but the City was impacted by falling market conditions primarily in the Cemetery Fund. Expenses For the fiscal year ended April 30, 2022, expenses for governmental activities totaled $50.7 million, an increase of $.7 million (1.4%). The increase is due in large part to pension adjustments and Recreation programs rebounding after the pandemic. Increases in personnel costs, which represent nearly 73.3% of the General Fund operating costs, continue to outpace revenue growth. With high demand for skilled employees in both the public and private sectors in this region, it is important that the City provide competitive compensation levels for our employees. The FY22 expenses included funding for the City’s performance-based employee compensation package plus a 2.5% general salary adjustment. Business-type Activities Revenue Total revenue for the business-type activities increased by $1.8 million (16.7%) primarily due to an increase of charges for services in the Water and Sewerage Fund and Golf Course Fund and contributions of $.5 million in the Golf Course Fund. The additional revenue in the Water and Sewerage Fund facilitated keeping the water rates flat for FY23. Expenses The City’s business-type activity expenses decreased by $.9 million (9.4%) primarily due to decreased operating expenses in the Water and Sewerage Fund. 42 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UN AUDITED) APRIL 30, 2022 13 FINANCIAL ANALYSIS OF THE CITY’S FUNDS Governmental Funds At April 30, 2022, the governmental funds (as presented on the balance sheet) reported a combined fund balance of $74.1 million which is an $9.3 million (14.3%) increase from the beginning of the year ($64.8 million). This increase was largely driven by excess of revenues over expenditures in the General Fund, Capital Improvement Fund, Motor Fuel Tax Fund and Laurel/Western Redevelopment TIF and decrease of revenue to the Cemetery Fund. The City Council elected to transfer from the General Fund an additional $3.4 million of the FY22 operating surplus to the Capital Improvement Fund to provide additional funding for capital improvements, $1.0 million was transferred to the Parks and Public Land Fund to support future capital projects, $.5 million was transferred to the Affordable Housing Fund to support future projects and $.6 million to the Self Insurance Fund to restore reserves. The Motor Fuel Tax fund received additional funding from a Rebuild Illinois Grant received from the state. Of the total fund balance of $74.1 million, $<.1 million is not available for continuing City services and capital projects, and $45.2 million is restricted in its use. The unassigned fund balance for the total of all governmental funds is $28.9 million, which is a $1.1 million (3.9%) increase over the prior year. Major Governmental Funds The General Fund is the City’s primary operating fund and the largest source of day-to-day service delivery. The total Fund Balance of the General Fund increased by $.6 million or 2.1% from FY21 (from $28.4 million to $29.0 million). The General Fund revenues increased by $3.0 million (7.7%) due primarily to higher property taxes and intergovernmental revenues, including sales tax and income tax revenue offset by decreases in grants and contribution revenue. The General Fund expenditures increased by $1.5 million (4.4%) due to personnel costs. The excess of revenues over expenditures (before transfers) for FY22 of $6.7 million was $1.5 million greater than FY21 $5.2 million. The other financing sources (uses) for FY22 of $6.1 million was lower than FY21 $6.4 million due to one-time revenues being transferred to other funds in FY21 to provide assistance for COVID-19 reduced revenues. Property taxes increased $.7 million, intergovernmental revenues increased $1.5 million, charges for services increased $.5, while grants and contributions decreased $.7 million due to the City receiving CARES Act funding in FY21 for COVID-19 impacts on City expenses. Although the City became a home rule unit in November 2004, the City has historically self-imposed the Illinois Property Tax Extension Limitation Law (PTELL), otherwise known as the tax cap. As noted previously, the 2020 levy extension (FY22 revenue) allowed for a 3.97% increase as well as new equalized assessed valuation growth. General Fund expenditures increased overall due to personnel cost increases. General government increased 4.8%, highways and streets increased 11.5% (personnel; snow and ice control), public safety increased 4.4% and sanitation remained constant. 43 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UN AUDITED) APRIL 30, 2022 14 Original Final General Fund Budget Budget Actual Revenues: Taxes $23.4 $23.4 $17.9 Intergovernmental 5.5 5.5 8.1 Other 8.8 8.8 16.1 Total 37.7 37.7 42.1 Expenditures and Transfers: Expenditures 40.8 41.0 35.4 Transfers (Net)0.7 0.6 6.1 Total 41.5 41.6 41.5 Change in Fund Balance ($3.8)($3.9) $0.6 Table 3 General Fund Budgetary Highlights (in millions) Actual General Fund revenues were higher than budgeted revenues by $4.4 million during FY22. The primary variance resulted from income tax, sales tax and building permits exceeding projections. Actual General Fund expenditures and transfers were lower than the final budget by $.1 million. It is the City’s policy to add 10%, which is $3.8 million of contingency funding to the budget appropriation. The contingency amount is only for specific uses as determined by the City Council and was used to transfer excess revenues over expenditures to other funds to be used for future projects. Additional information can be found on the schedule of revenues, expenditures, and changes in fund balance – budget and actual. The Parks and Recreation Fund accounts for the parks and recreation programs. Services include forestry and parks maintenance operations, a fitness center, dance academy, and a variety of other indoor and outdoor programs. The Fund Balance of the Parks and Recreation Fund increased by $.5 million, from $1.4 million to $1.9 million. The Parks and Recreation Fund revenues increased by $1.9 million due to reinstatement of programs cancelled as the result of COVID-19. Expenses increased by $.8 million due to reinstatement of programs cancelled as the result of COVID-19. Total other financing sources (uses) were $.8 million in FY21, but $<.1 million in FY22, due to a onetime transfer in FY21 from the General Fund to assist with COVID-19 related impacts. The Capital Improvements Fund is reported as a Major Fund for FY22 and is used to account for revenues associated with City building and infrastructure projects. Fund balance of this fund increased by $6.1 million in FY22. Compared to FY21, revenue increased by $.1 million due to increases in sales tax offset by decreases in contributions and real estate transfer tax. Total expenditures decreased by $.5 million in the capital outlay category. Transfers in of $4.7 million for FY22 consisted of one-time fund balance transfer of $3.4 million from the General Fund for one-time capital improvements and $.5 million from the Laurel/Western Redevelopment TIF for the first note repayment associated with the sale of the City owned property to a developer. The Cemetery Fund is reported as a Major Fund in FY22 and is used to account for the operations of the Cemetery Commission. Fund balance for this fund decreased by $.7 million in FY22. Compared to FY21, revenues decreased $3.9 million due to increases in charges for services, $.6 million from cemetery lot sales, offset by decreases to investment income of $4.5 million for losses on investment returns. Expenses remained constant in FY22. 44 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UN AUDITED) APRIL 30, 2022 15 CAPITAL ASSETS 2021 2022 2021 2022 2021 2021 Land and Improvements $40.6 $42.9 $0.5 $0.7 $41.1 $43.6 Infrastructure - Land 66.7 66.7 66.7 66.7 Construction in Progress 0.1 0.1 0.0 0.9 0.1 1.0 Infrastructure 50.9 48.6 50.9 48.6 Buildings 16.3 16.2 8.4 7.4 24.7 23.6 Improvements 14.3 13.2 31.1 30.1 45.4 43.3 Machinery and Equipment 4.3 4.3 1.4 1.1 5.7 5.4 Sanitary Sewers 0.0 0.0 11.5 11.1 11.5 11.1 Total $193.2 $192.0 $52.9 $51.3 $246.1 $243.3 Table 4 Capital Assets at Year End - 2021 and 2022 Net of Depreciation (in millions) Governmental Activities Business-Type Activities Total Primary Government At the end of FY22, the City had a combined total of $243.3 million invested in a broad range of capital assets. This amount represents a net decrease (including additions and deductions) of $2.8 million. The net decrease is attributable to a $1.2 million in governmental activities and a $1.6 million decrease in the business-type activities. The decrease in the governmental activities was due to depreciation exceeding additions by $.9 million. The decrease in business-type activities was due primarily to $1.6 million of depreciation exceeding additions. The following reconciliation summarizes the changes in Capital Assets which are presented in detail in Note 3. Governmental Business-Type Activities Activities Total Beginning Balance $193.2 $52.9 $246.1 Additions Not Depreciable 2.3 0.3 2.6 Depreciable 1.9 0.5 2.4 Construction in Progress 0.0 0.9 0.9 Retirements Depreciable (0.1)0.0 (0.1) Depreciation (5.3)(3.3)(8.6) Retirements 0.0 0.0 0.0 Ending Balance $192.0 $51.3 $243.3 Change in Capital Assets (in millions) 45 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UN AUDITED) APRIL 30, 2022 16 The increase in Governmental Activities Not Depreciable assets of $2.3 million was due to a donation of property from the Ragdale Foundation. Debt Outstanding The City had $37.7 million of general obligation bonds outstanding at April 30, 2022. Of this amount $19.6 million were payable from property taxes and the remainder were self-supporting. The City abates the property tax levies for these debt issues annually. The City’s per capita debt ratio for all direct and overlapping debt with other governmental units was $4,924 and $3,914 if self-supporting debt is excluded. The City operated as a home rule community for FY22. The City was granted home rule status via a referendum held on November 2, 2004. Under home rule authority, the City does not have a legal debt limit. For more detailed information on long-term debt activity, see the notes to the financial statements. As of April 30, 2022, the City’s net pension liability is $52.6 million, an increase of $8.5 million compared to the $44.1 million balance as of April 30, 2021. Additional information regarding the net pension liability can be found in Note 4. As of April 30, 2022, the City’s OPEB liability is $2.1 million, a decrease of $.2 million compared to the $2.3 million balance as of April 30, 2021. Additional information regarding the OPEB liability can be found in Note 4. Economic Factors Unemployment levels in Lake Forest are well below the levels for Lake County and the State of Illinois. For calendar year 2021, the City’s annual average unemployment rate was estimated to be 3.8%, compared to 5.3% for Lake County and 6.1% for the State of Illinois. The City maintains a Aaa bond rating from Moody’s Investors Service. CONTACTING THE CITY’S FINANCIAL MANAGEMENT This financial report is designed to provide our citizens, customers, investors, and creditors with a general overview of the City’s finances and to demonstrate the City’s accountability for the money it receives. Questions concerning this report or requests for additional financial information should be directed to Elizabeth Holleb, Finance Director, City of Lake Forest, 800 N. Field Drive, Lake Forest, IL 60045 or by email at HollebE@cityoflakeforest.com . 46 BASIC FINANCIAL STAT EMENTS 47 City of Lake Forest Statement of Net Position April 30, 2022 Primary Government Component Unit Governmental Activities Business- Type Activities Total Lake Forest Library Assets and Deferred Outflows of Resources Assets Cash and cash equivalents $75,101,100 $11,754,399 $86,855,499 $7,193,111 Investments 9,058,582 -9,058,582 - Receivables (net): Property taxes 31,597,331 -31,597,331 4,417,017 Other taxes 430,632 -430,632 24,562 Accounts 1,386,656 1,506,260 2,892,916 - Loans 4,318 -4,318 - Other 7,043,293 130 7,043,423 - Due from other governmental units 2,401,865 -2,401,865 - Internal balances (1,056,992)1,056,992 -- Inventories 589,309 90,216 679,525 - Prepaid items 748,187 166,518 914,705 - Net pension asset 12,844,903 1,957,016 14,801,919 1,477,936 Due from fiduciary funds 38,713 -38,713 - Capital assets: Capital assets not being depreciated 109,668,130 1,618,024 111,286,154 238,500 Capital assets being depreciated, net of accumulated depreciation 82,370,013 49,668,597 132,038,610 2,311,482 Total assets 332,226,040 67,818,152 400,044,192 15,662,608 Deferred Outflows of Resources Deferred charge on refunding 151 214 365 - Deferred outflows related to pensions 8,256,147 240,071 8,496,218 202,218 Deferred outflows related to total OPEB liability 267,588 24,895 292,483 5,301 Total deferred outflows of resources 8,523,886 265,180 8,789,066 207,519 See notes to financial statements 17 48 City of Lake Forest Statement of Net Position April 30, 2022 Primary Government Component Unit Governmental Activities Business- Type Activities Total Lake Forest Library Liabilities, Deferred inflows of Resources and Net Position Liabilities Accounts payable $2,525,840 $294,071 $2,819,911 $85,718 Accrued liabilities 1,558,607 89,118 1,647,725 60,348 Accrued interest payable 304,891 163,782 468,673 - Deposits 1,407,129 -1,407,129 - Unearned revenue 3,877,747 348,292 4,226,039 - Due to fiduciary funds 74,076 -74,076 - Noncurrent liabilities: Due within one year 2,367,956 1,981,252 4,349,208 18,309 Due in more than one year 80,579,595 11,175,986 91,755,581 223,520 Total liabilities 92,695,841 14,052,501 106,748,342 387,895 Deferred Inflows of Resources Property taxes levied for future periods 31,597,333 -31,597,333 4,417,017 Deferred inflows related to pensions 14,060,874 2,017,383 16,078,257 1,523,526 Deferred inflows related to total OPEB liability 499,315 46,452 545,767 19,134 Total deferred inflows of resources 46,157,522 2,063,835 48,221,357 5,959,677 Net Position Net investment in capital assets 165,811,050 38,585,070 204,396,120 2,536,673 Restricted for: Culture and recreation 4,378,607 -4,378,607 - Highways and streets 2,395,746 -2,395,746 - Public safety 1,632,878 -1,632,878 - Cemetery purposes 10,643,506 -10,643,506 - Affordable housing 2,183,485 -2,183,485 - Capital projects 22,371,936 -22,371,936 - Debt service 1,289,569 -1,289,569 - Employee retirement 12,844,903 1,957,016 14,801,919 1,477,936 Unrestricted (21,655,117)11,424,910 (10,230,207)5,507,946 Total net position $201,896,563 $51,966,996 $253,863,559 $9,522,555 See notes to financial statements 18 49 City of Lake Forest Statement of Activities Year Ended April 30, 2022 Program Revenues Net (Expenses) Revenues and Changes in Net Position Primary Government Component Unit Functions/Programs Expenses Charges for Services Operating Grants and Contributions Capital Grants and Contributions Governmental Activities Business-Type Activities Total Lake Forest Library Primary Government Governmental activities: General government $11,182,027 $4,296,082 $149,650 $1,942,607 $(4,793,688)$-$(4,793,688)$- Highway and streets 6,929,008 2,726,225 773,723 425,630 (3,003,430)-(3,003,430)- Sanitation 1,959,547 1,040,338 --(919,209)-(919,209)- Culture and recreation 9,205,623 2,885,644 230,417 -(6,089,562)-(6,089,562)- Public safety 20,578,227 2,946,021 10,241 -(17,621,965)-(17,621,965)- Interest on long-term debt 871,548 ---(871,548)-(871,548)- Total governmental activities 50,725,980 13,894,310 1,164,031 2,368,237 (33,299,402)-(33,299,402)- Business-type activities: Waterworks and Sewerage 7,441,106 9,695,464 ---2,254,358 2,254,358 - Deerpath Golf Course 2,161,621 1,824,684 -554,466 -217,529 217,529 - Total business-type activities 9,602,727 11,520,148 -554,466 -2,471,887 2,471,887 - Total primary government $60,328,707 $25,414,458 $1,164,031 $2,922,703 (33,299,402)2,471,887 (30,827,515)- Component Unit Lake Forest Library $3,165,420 $59,895 $44,898 $----(3,060,627) General Revenues Taxes: Property 32,149,905 -32,149,905 4,375,175 Home rule sales 1,795,817 -1,795,817 - Utility 2,562,347 -2,562,347 - Real estate transfer 2,652,110 -2,652,110 - Other 441,292 -441,292 - Intergovernmental, unrestricted: Sales 2,964,912 -2,964,912 - Income 3,829,655 -3,829,655 - Telecommunication 723,424 -723,424 - Replacement 396,217 -396,217 101,341 Coronavirus relief fund 227,899 -227,899 - Other 1,793,870 374,139 2,168,009 - Investment income (losses)(883,765)56,757 (827,008)37,504 Total general revenues 48,653,683 430,896 49,084,579 4,514,020 Transfers (52,500)52,500 -- Total general revenues and transfers 48,601,183 483,396 49,084,579 4,514,020 Change in net position 15,301,781 2,955,283 18,257,064 1,453,393 Net Position, Beginning 186,594,782 49,011,713 235,606,495 8,069,162 Net Position, Ending $201,896,563 $51,966,996 $253,863,559 $9,522,555 See notes to financial statements 19 50 City of Lake Forest Balance Sheet Governmental Funds April 30, 2022 General Parks and Recreation General Cemetery Capital Improvements Assets Cash and cash equivalents $29,740,933 $2,442,609 $1,570,466 $23,711,152 Investments --9,058,582 - Receivables (net): Property taxes 21,552,635 6,456,670 -1,525,674 Other taxes 430,632 --- Accounts 1,088,974 287,067 -10,615 Loans 4,318 --- Other 200,000 --- Due from other governments 1,726,218 30,726 -439,909 Due from other funds -125,000 -- Due from fiduciary funds --38,713 - Inventories 91,038 --- Total assets $54,834,748 $9,342,072 $10,667,761 $25,687,350 Liabilities, Deferred Inflows of Resources and Fund Balances Liabilities Accounts payable $595,501 $283,383 $19,046 $435,964 Accrued liabilities 510,292 92,213 5,209 - Deposits 1,357,256 3,873 -28,000 Unearned revenue 1,781,263 624,712 -1,331,775 Due to fiduciary funds 74,076 --- Total liabilities 4,318,388 1,004,181 24,255 1,795,739 Deferred Inflows of Resources Property taxes levied for a future period 21,552,635 6,456,670 -1,525,674 Unavailable revenues ---25,162 Total deferred inflows of resources 21,552,635 6,456,670 -1,550,836 Fund Balances Nonspendable 91,038 --- Restricted -1,881,221 10,643,506 22,340,775 Unassigned 28,872,687 --- Total fund balances 28,963,725 1,881,221 10,643,506 22,340,775 Total liabilities, deferred inflows of resources and fund balances $54,834,748 $9,342,072 $10,667,761 $25,687,350 See notes to financial statements 20 51 Nonmajor Governmental Funds Total $9,430,603 $66,895,763 -9,058,582 2,062,352 31,597,331 -430,632 -1,386,656 -4,318 1,105,853 1,305,853 205,012 2,401,865 -125,000 -38,713 -91,038 $12,803,820 $113,335,751 $268,370 $1,602,264 5,145 612,859 18,000 1,407,129 139,997 3,877,747 -74,076 431,512 7,574,075 2,062,354 31,597,333 -25,162 2,062,354 31,622,495 -91,038 10,309,954 45,175,456 -28,872,687 10,309,954 74,139,181 $12,803,820 $113,335,751 See notes to financial statements 21 52 City of Lake Forest Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position April 30, 2022 Total Fund Balances, Governmental Funds $74,139,181 Amounts reported for governmental activities in the statement of net position are different because: Capital assets used in governmental funds are not financial resources and, therefore, are not reported in the funds. 192,038,143 Some receivables that are not currently available are reported as unavailable revenues in the fund financial statements but are recognized as revenue when earned in the government- wide statements.25,162 The net pension asset does not relate to current financial resources and is not reported in the governmental funds.12,844,903 Less amount reported in the internal service fund below.(623,708) Deferred outflows of resources related to pensions do not relate to current financial resources and are not reported in the governmental funds.8,256,147 Less amount reported in the internal service fund below.(77,171) Deferred inflows of resources related to pensions do not relate to current financial resources and are not reported in the governmental funds.(14,060,874) Less amount reported in the internal service fund below.642,948 Deferred outflows of resources related to total OPEB liability do not relate to current financial resources and are not reported in the governmental funds.267,588 Less amount reported in the internal service fund below.(7,972) Deferred inflows of resources related to total OPEB liability do not relate to current financial resources and are not reported in the governmental funds.(499,315) Less amount reported in the internal service fund below.14,876 Some liabilities, including long-term debt, are not due and payable in the current period and, therefore, are not reported in the funds. Bonds and notes payable (25,192,203) Compensated absences (2,138,078) Accrued interest (304,891) Unamortized debt premium (1,035,041) Net pension liabilities (52,632,390) Total OPEB liability (1,949,839) Less internal service fund long-term liabilities 93,277 A deferred charge on refunding represents a consumption of net position that applies to a future period and, therefore, is not reported in the funds.151 Internal service funds are reported in the statement of net position as governmental activities.12,095,669 Net Position of Governmental Activities $201,896,563 See notes to financial statements 22 53 City of Lake Forest Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds Year Ended April 30, 2022 General Parks and Recreation General Cemetery Capital Improvements Revenues Taxes: Property $20,785,656 $6,434,953 $-$1,543,453 Other taxes 2,900,697 --3,788,550 Intergovernmental 8,058,224 124,753 -- Licenses and permits 3,460,452 --- Fines, forfeitures and penalties 256,681 --- Charges for services 4,893,680 2,746,614 1,354,260 198,013 Grants and contributions 238,424 249,707 15,325 62,411 Investment income (loss)122,020 15,739 (1,182,676)87,418 Miscellaneous revenues 1,341,542 59,880 50 960 Total revenues 42,057,376 9,631,646 186,959 5,680,805 Expenditures Current: General government 10,913,887 -734,653 535,401 Highways and streets 2,853,140 --1,141,352 Sanitation 2,573,258 --10,423 Culture and recreation -8,979,517 -4,911 Public safety 18,965,034 --- Capital outlay 62,779 180,176 161,954 2,488,782 Debt service: Principal retirement ---- Interest and fiscal charges ---- Total expenditures 35,368,098 9,159,693 896,607 4,180,869 Excess (deficiency) of revenues over expenditures 6,689,278 471,953 (709,648)1,499,936 Other Financing Sources (Uses) Transfers in -23,500 -4,650,000 Transfers out (6,082,481)(50,000)-- Refunding debt issued ---- Premium on debt issued ---- Payment to refunded bonds escrow agent ---- Total other financing sources (uses)(6,082,481)(26,500)-4,650,000 Net change in fund balances 606,797 445,453 (709,648)6,149,936 Fund Balances, Beginning 28,356,928 1,435,768 11,353,154 16,190,839 Fund Balances, Ending $28,963,725 $1,881,221 $10,643,506 $22,340,775 See notes to financial statements 23 54 Nonmajor Governmental Funds Total $3,385,843 $32,149,905 731,377 7,420,624 1,198,688 9,381,665 -3,460,452 -256,681 722,693 9,915,260 237,437 803,304 38,099 (919,400) 375,501 1,777,933 6,689,638 64,246,424 128,930 12,312,871 -3,994,492 -2,583,681 756,255 9,740,683 499,576 19,464,610 267,194 3,160,885 2,009,665 2,009,665 957,831 957,831 4,619,451 54,224,718 2,070,187 10,021,706 2,117,794 6,791,294 (1,361,313)(7,493,794) 7,590,000 7,590,000 511,784 511,784 (8,101,528)(8,101,528) 756,737 (702,244) 2,826,924 9,319,462 7,483,030 64,819,719 $10,309,954 $74,139,181 See notes to financial statements 24 55 City of Lake Forest Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities Year Ended April 30, 2022 Net Change in Fund Balances, Total Governmental Funds $9,319,462 Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures. However, in the statement of net position the cost of these assets is capitalized and they are depreciated over their estimated useful lives and reported as depreciation expense in the statement of activities. Capital outlay is reported as an expenditure in the fund financial statements but is capitalized in the government-wide financial statements 4,134,414 Depreciation is reported in the government-wide financial statements (5,262,216) Receivables not currently available are reported as revenue when collected or currently available in the fund financial statements but are recognized as revenue when earned in the government-wide financial statements. Unavailable revenue (6,287) Debt issued provides current financial resources to governmental funds, but issuing debt increases long-term liabilities in the statement of net position. Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net position. Debt issued (7,590,000) Principal repaid 10,029,665 Governmental funds report debt premiums and discounts as other financing sources or uses. However, in the statement of net position, these are reported as additions to or deductions from long-term debt. These are allocated over the period the debt is outstanding in the statement of activities and are reported as interest expense. Debt premium (327,661) Some expenses in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in the governmental funds. Compensated absences 29,686 Accrued interest on debt (44,830) Amortization of deferred charge on refunding 28,516 Net pension asset 9,070,986 Deferred outflows of resources related to pensions (1,539,458) Deferred inflows of resources related to pensions 4,956,238 Net pension liability (8,504,873) Deferred outflows of resources related to OPEB Liability (32,974) Deferred inflows of resources related to OPEB Liability (104,739) Total OPEB liability 108,808 Less amount reported in internal service funds below (237,884) Internal service funds are used by management to charge self insurance costs to individual funds. The change in net position of the internal service fund reported with governmental activities 1,274,928 Change in Net Position of Governmental Activities $15,301,781 See notes to financial statements 25 56 City of Lake Forest Statement of Net Position Proprietary Funds April 30, 2022 Business-Type Activities - Enterprise Funds Waterworks and Sewerage Nonmajor Enterprise Fund - Deerpath Golf Course Total Governmental Activities - Internal Service Funds Assets Current assets: Cash and cash equivalents $11,306,942 $447,457 $11,754,399 $8,205,337 Receivables: Accounts 1,504,768 1,492 1,506,260 - Other 130 -130 5,737,440 Inventories -90,216 90,216 498,271 Prepaid items -166,518 166,518 748,187 Total current assets 12,811,840 705,683 13,517,523 15,189,235 Noncurrent assets: Net pension asset 1,924,038 32,978 1,957,016 623,708 Capital assets: Capital assets not being depreciated 1,522,507 95,517 1,618,024 - Capital assets being depreciated 116,011,893 6,087,502 122,099,395 48,047 Less accumulated depreciation (68,472,812)(3,957,986)(72,430,798)(48,047) Total noncurrent assets 50,985,626 2,258,011 53,243,637 623,708 Total assets 63,797,466 2,963,694 66,761,160 15,812,943 Deferred Outflows of Resources Deferred charge on refunding 214 -214 - Deferred outflows related to pensions 228,150 11,921 240,071 77,171 Deferred outflows related to total OPEB liability 24,489 406 24,895 7,972 Total deferred outflows of resources 252,853 12,327 265,180 85,143 See notes to financial statements 26 57 City of Lake Forest Statement of Net Position Proprietary Funds April 30, 2022 Business-Type Activities - Enterprise Funds Waterworks and Sewerage Nonmajor Enterprise Fund - Deerpath Golf Course Total Governmental Activities - Internal Service Funds Liabilities Current liabilities: Accounts payable $171,311 $122,760 $294,071 $923,576 Accrued liabilities 75,065 14,053 89,118 945,748 Accrued interest payable 160,469 3,313 163,782 - Unearned revenue 18,648 329,644 348,292 - General obligation bonds 1,888,607 87,645 1,976,252 - Compensated absences 4,981 19 5,000 - Due to other funds -125,000 125,000 - Total current liabilities 2,319,081 682,434 3,001,515 1,869,324 Noncurrent liabilities: Long-term debt: General obligation debt payable 10,629,874 95,639 10,725,513 - Compensated absences 261,122 7,951 269,073 35,186 Total OPEB liability 178,441 2,959 181,400 58,091 Total noncurrent liabilities 11,069,437 106,549 11,175,986 93,277 Total liabilities 13,388,518 788,983 14,177,501 1,962,601 Deferred Inflows of Resources Deferred inflows related to pensions 1,983,389 33,994 2,017,383 642,948 Deferred inflows related to total OPEB liability 45,695 757 46,452 14,876 Total deferred inflows of resources 2,029,084 34,751 2,063,835 657,824 Net Position Net investment in capital assets 36,543,321 2,041,749 38,585,070 - Restricted for: Employee retirement 1,924,038 32,978 1,957,016 623,708 Unrestricted 10,165,358 77,560 10,242,918 12,653,953 Total net position $48,632,717 $2,152,287 50,785,004 $13,277,661 Adjustments to reflect the consolidation of internal service funds activities related to enterprise funds.1,181,992 Net position business-type activities $51,966,996 See notes to financial statements 27 58 City of Lake Forest Statement of Revenues, Expenses and Changes in Net Position Proprietary Funds Year Ended April 30, 2022 Business-Type Activities - Enterprise Funds Waterworks and Sewerage Nonmajor Enterprise Fund - Deerpath Golf Course Total Governmental Activities - Internal Service Funds Operating Revenues Charges for services $9,845,800 $1,822,996 $11,668,796 $9,987,594 Connection fees 219,227 -219,227 - Miscellaneous 4,576 1,688 6,264 - Total operating revenues 10,069,603 1,824,684 11,894,287 9,987,594 Operating Expenses General and administrative 1,771,706 694,959 2,466,665 9,361,017 Operations and maintenance 2,402,363 1,169,159 3,571,522 - Depreciation and amortization 2,967,360 327,977 3,295,337 - Total operating expenses 7,141,429 2,192,095 9,333,524 9,361,017 Operating income (loss)2,928,174 (367,411)2,560,763 626,577 Nonoperating Revenues (Expenses) Investment income 54,316 2,441 56,757 35,635 Other -4,137 4,137 - Interest expense (305,982)(3,729)(309,711)- Paying agent fees (905)(8)(913)- Total nonoperating revenues (expenses)(252,571)2,841 (249,730)35,635 Income (loss) before contributions and transfers 2,675,603 (364,570)2,311,033 662,212 Contributions and Transfers Capital contributions -554,466 554,466 - Transfers in 2,500 50,000 52,500 650,000 Total contributions and transfers 2,500 604,466 606,966 650,000 Change in net position 2,678,103 239,896 2,917,999 1,312,212 Net Position, Beginning 45,954,614 1,912,391 47,867,005 11,965,449 Net Position, Ending $48,632,717 $2,152,287 50,785,004 $13,277,661 Adjustment to change in net position to reflect the consolidation of internal service funds activities related to enterprise funds 37,284 Change in net position of business-type activities $2,955,283 See notes to financial statements 28 59 City of Lake Forest Statement of Cash Flows Proprietary Funds Year Ended April 30, 2022 Business-Type Activities - Enterprise Funds Waterworks and Sewerage Nonmajor Enterprise Fund - Deerpath Golf Course Total Governmental Activities - Internal Service Funds Cash Flows From Operating Activities Received from customers $10,045,946 $1,764,572 $11,810,518 $8,711,103 Paid to suppliers for goods and services (2,373,882)(1,272,122)(3,646,004)(8,997,227) Paid to employees for services (2,465,682)(708,629)(3,174,311)(823,431) Other revenue -4,137 4,137 - Net cash flows from operating activities 5,206,382 (212,042)4,994,340 (1,109,555) Cash Flows From Investing Activities Investment income 54,316 2,441 56,757 35,635 Net cash flows from investing activities 54,316 2,441 56,757 35,635 Cash Flows From Noncapital Financing Activities Transfers from (to) other funds 2,500 50,000 52,500 650,000 Net cash flows from noncapital financing activities 2,500 50,000 52,500 650,000 Cash Flows From Capital and Related Financing Activities Principal paid (1,782,347)(89,600)(1,871,947)- Interest paid (513,447)(13,284)(526,731)- Acquisition and construction of capital assets (1,176,611)(507,138)(1,683,749)- Capital contributions -554,466 554,466 - Other, paying agent fees (905)(8)(913)- Net cash flows from capital and related financing activities (3,473,310)(55,564)(3,528,874)- Net change in cash and cash equivalents 1,789,888 (215,165)1,574,723 (423,920) Cash and Cash Equivalents, Beginning 9,517,054 662,622 10,179,676 8,629,257 Cash and Cash Equivalents, Ending $11,306,942 $447,457 $11,754,399 $8,205,337 See notes to financial statements 29 60 City of Lake Forest Statement of Cash Flows Proprietary Funds Year Ended April 30, 2022 Business-Type Activities - Enterprise Funds Waterworks and Sewerage Nonmajor Enterprise Fund - Deerpath Golf Course Total Governmental Activities - Internal Service Funds Reconciliation of Operating Income (Loss) to Net Cash Flows From Operating Activities Operating income (loss)$2,928,174 $(367,411)$2,560,763 $626,577 Nonoperating revenue -4,137 4,137 - Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation 2,967,360 327,977 3,295,337 - Changes in assets and liabilities: Accounts receivable (18,076)(1,255)(19,331)(1,276,491) Inventories -10,936 10,936 (82,392) Prepaid items -(75,773)(75,773)(123,910) Net pension asset (1,353,584)(23,420)(1,377,004)(441,796) Deferred outflows related to pensions (64,929)(6,358)(71,287)(24,671) Deferred outflows related to OPEB 3,315 49 3,364 1,048 Accounts payable 28,481 (38,126)(9,645)(63,661) Accrued liabilities ---48,206 Accrued salaries 27,002 1,599 28,601 - Deferred inflows related to pensions 692,644 12,369 705,013 231,345 Deferred inflows related to OPEB 9,194 160 9,354 3,034 Deferred revenue (5,581)(58,857)(64,438)- Compensated absences 4,382 2,087 6,469 (3,152) Total OPEB liability (12,000)(156)(12,156)(3,692) Net cash flows from operating activities $5,206,382 $(212,042)$4,994,340 $(1,109,555) Noncash Capital and Related Financing Activities None See notes to financial statements 30 61 City of Lake Forest Statement of Fiduciary Net Position Fiduciary Funds April 30, 2022 Private Purpose Trust Fund Pension Trust Funds Assets Cash $-$962,467 Money markets 33,801 242,727 Investments: U.S. Treasury obligations -7,961,878 Municipal/corporate bonds -5,822,089 Equity securities 389,404 - Mutual funds 297,451 22,987,786 Real estate investment fund -5,072,527 Firefighters pension investment fund -46,304,968 Receivables: Interest -74,197 Prepaid items -11,968 Due from other funds -74,076 Total assets 720,656 89,514,683 Liabilities Accounts payable -26,794 Due to primary government 38,713 - Total liabilities 38,713 26,794 Net Position Restricted for pension benefits -89,487,889 Restricted for other purposes 681,943 - Total net position $681,943 $89,487,889 See notes to financial statements 31 62 City of Lake Forest Statement of Changes in Fiduciary Net Position Fiduciary Funds Year Ended April 30, 2022 Private Purpose Trust Fund Pension Trust Funds Additions Contributions: Employer $-$5,778,247 Employee -818,428 Total contributions -6,596,675 Investment income: Interest 10,249 1,178,996 Net appreciation (depreciation) in fair value of investments (94,434)(4,490,387) Total Investment Income (loss)(84,185)(3,311,391) Less Investment expense -(145,496) Net Investment Income (loss)(84,185)(3,456,887) Miscellaneous -100 Total additions (84,185)3,139,888 Deductions Pension benefits and refunds -6,593,092 Other administrative expenses 38,915 103,650 Total deductions 38,915 6,696,742 Change in fiduciary net position (123,100)(3,556,854) Net Position, Beginning 805,043 93,044,743 Net Position, Ending $681,943 $89,487,889 See notes to financial statements 32 63 City of Lake Forest Index to Notes to Financial Statements April 30, 2022 Page 1.Summary of Significant Accounting Policies 34 Reporting Entity 34 Government-W ide and Fund Financial Statements 35 Measurement Focus, Basis of Accounting and Financial Statement Presentation 38 Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources and Net Position or Equity 39 Deposits and Investments 39 Receivables 43 Inventories and Prepaid Items 43 Capital Assets 44 Deferred Outflows of Resources 44 Compensated Absences 45 Long-Term Obligations 45 Deferred Inflows of Resources 45 Equity Classifications 45 2.Stewardship, Compliance and Accountability 47 Budgetary Information 47 Excess Expenditures Over Budget 47 3.Detailed Notes on All Funds 48 Deposits and Investments 48 Receivables 52 Capital Assets 52 Interfund Receivables/Payables and Transfers 54 Long-Term Obligations 56 Lease Disclosures 58 Net Position/Fund Balances 58 4.Other Information 59 Employees' Retirement System 59 Risk Management 75 Joint Ventures 77 Other Postemployment Benefits 78 Subsequent Event 81 Laurel and W estern Tax Increment Financing (TIF) District 81 Effect of New Accounting Standards on Current-Period Financial Statements 82 33 64 City of Lake Forest Notes to Financial Statements April 30, 2022 1.Summary of Significant Accounting Policies The City of Lake Forest, Illinois (the City) was incorporated in 1861 under a charter granted by the Illinois State Legislature that was amended in 1869. The City is a home-rule municipality, under the 1970 Illinois Constitution, located in Lake County, Illinois. The City provides the following services as authorized by its charter: public safety (police and fire protection), water and sewer, recreation, refuse collection, a senior center, public library, a cemetery and a golf course. The accounting policies of the City of Lake Forest, Illinois conform to accounting principles generally accepted in the United States of America as applicable to governmental units. The accepted standard- setting body for establishing governmental accounting and financial reporting principles is the Governmental Accounting Standards Board (GASB). Reporting Entity This report includes all of the funds of the City. The reporting entity for the City consists of the primary government and its component units. Component units are legally separate organizations for which the primary government is financially accountable or other organizations for which the nature and significance of their relationship with the primary government are such that their exclusion would cause the reporting entity's financial statements to be misleading. The primary government is financially accountable if (1) it appoints a voting majority of the organization's governing body and it is able to impose its will on that organization, (2) it appoints a voting majority of the organization's governing body and there is a potential for the organization to provide specific financial benefits to or impose specific financial burdens on, the primary government, (3) the organization is fiscally dependent on and there is a potential for the organization to provide specific financial benefits to or impose specific financial burdens on, the primary government. Certain legally separate, tax exempt organizations should also be reported as a component unit if all of the following criteria are met: (1) the economic resources received or held by the separate organization are entirely or almost entirely for the direct benefit of the primary government, its component units or its constituents; (2) the primary government or its component units, is entitled to or has the ability to access, a majority of the economic resources received or held by the separate organization; and (3) the economic resources received or held by an individual organization that the primary government or its component units, is entitled to or has the ability to otherwise access, are significant to the primary government. Component units are reported using one of three methods, discrete presentation, blended or fiduciary. Generally, component units should be discretely presented in a separate column in the financial statements. A component unit should be reported as part of the primary government using the blending method if it meets any one of the following criteria: (1) the primary government and the component unit have substantively the same governing body and a financial benefit or burden relationship exists, (2) the primary government and the component unit have substantively the same governing body and management of the primary government has operational responsibility for the component unit, (3) the component unit serves or benefits, exclusively or almost exclusively, the primary government rather than its citizens or (4) the total debt of the component unit will be paid entirely or almost entirely from resources of the primary government. Discretely Presented Component Unit Lake Forest Library The government-wide financial statements include the Lake Forest Library (Library) as a component unit. The Library is a legally separate organization governed by a seven member Board of Trustees. The board of the Library is appointed by the Mayor of the City. The Library is financially accountable to the City as the City's approval is needed for the Library to issue bonded debt. Complete financial statements of the Library are available at the City's Adm inistrative Office, 800 North Field Drive, Lake Forest, Illinois 60045. The Library follows the same accounting policies as the City. 34 65 City of Lake Forest Notes to Financial Statements April 30, 2022 Fiduciary Component Units The Police Pension Employees Retirement System (PPERS) is established for the City's police employees. PPERS functions for the benefit of these employees and is governed by a five- member pension board. Two members appointed by the City’s Mayor with approval of the City Council, one pension beneficiary elected by the membership and two police employees elected by the membership constitute the pension board. The City and the PPERS participants are obligated to fund all PPERS costs based upon actuarial valuations. A municipality is considered to have a financial burden if it is legally obligated or has otherwise assumed the obligation to make contributions to the pension plan. The State of Illinois is authorized to establish benefit levels and the City is authorized to approve the actuarial assumptions used in the determination of contribution levels. PPERS is reported as a fiduciary component unit pension trust fund and the data for the pension is included in the government's fiduciary fund financial statements as a pension trust fund. No separate annual financial report is issued for the PPERS. The Firefighters’ Pension Employees Retirement System (FPERS) is established for the City's firefighters. FPERS functions for the benefit of these employees and is governed by a five-member pension board. Two members appointed by the City’s Mayor with approval of the City Council, one pension beneficiary elected by the membership; and two fire employees elected by the membership constitute the pension board. The City and the FPERS participants are obligated to fund all FPERS costs based upon actuarial valuations. A municipality is considered to have a financial burden if it is legally obligated or has otherwise assumed the obligation to make contributions to the pension plan. The State of Illinois is authorized to establish benefit levels and the City is authorized to approve the actuarial assumptions used in the determination of contribution levels. FPERS is reported as a fiduciary component unit and the data for the pension is included in the government's fiduciary fund financial statements as a pension trust fund. No separate annual financial report is issued for the FPERS. Government-Wide and Fund Financial Statements Government-Wide Financial Statements The statement of net position and statement of activities display information about the reporting government as a whole. They include all funds of the reporting entity except for fiduciary funds. The statements distinguish between governmental and business-type activities. Governmental activities generally are financed through taxes, intergovernmental revenues and other nonexchange revenues. Business-type activities are financed in whole or in part by fees charged to external parties for goods or services. Likewise, the primary government is reported separately from certain legally separate component units for which the primary government is financially accountable. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. The City does not allocate indirect expenses to functions in the statement of activities. Program revenues include 1) charges to customers or applicants who purchase, use or directly benefit from goods, services or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not included among program revenues are reported as general revenues. Internally dedicated resources are reported as general revenues rather than as program revenues. Fund Financial Statements Financial statements of the City are organized into funds, each of which is considered to be a separate accounting entity. Each fund is accounted for by providing a separate set of self- balancing accounts, which constitute its assets, deferred outflows of resources, liabilities, deferred inflows of resources, net position/fund balance, revenues and expenditures/expenses. 35 66 City of Lake Forest Notes to Financial Statements April 30, 2022 Funds are organized as major funds or nonmajor funds within the governmental and proprietary statements. An emphasis is placed on major funds within the governmental and proprietary categories. A fund is considered major if it is the primary operating fund of the City or meets the following criteria: a. Total assets/deferred outflows of resources, liabilities/deferred inflows of resources, revenues or expenditures/expenses of that individual governmental or enterprise fund are at least 10% of the corresponding total for all funds of that category or type and b. The same element of the individual governmental or enterprise fund that met the 10% test is at least 5% of the corresponding total for all governmental and enterprise funds combined. c. In addition, any other governmental or enterprise fund that the City believes is particularly important to financial statement users may be reported as a major fund. Separate financial statements are provided for governmental funds, proprietary funds and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. The City reports the following major governmental funds: General Fund General Fund accounts for the City's primary operating activities. It is used to account for and report all financial resources except those accounted for and reported in another fund. Special Revenue Funds Parks and Recreation Fund is used to account for the maintenance of parks and recreation programs. Services include a fitness center, dance academy and a variety of other indoor and outdoor programs. Principal revenue sources for this fund include a dedicated tax levy, grants, contributions and program fees. General Cemetery Fund is used to account for the operations of the cemetery commission. Financing is provided by the proceeds from cemetery lot sales, user charges and donations. Capital Projects Fund Capital Improvements Fund is used to account for revenues to be used to fund City building and infrastructure projects. Enterprise Fund The City reports the following major enterprise fund: Waterworks and Sewerage Fund accounts for operations of the waterworks and sewerage system for the residents of the City. 36 67 City of Lake Forest Notes to Financial Statements April 30, 2022 The City reports the following nonmajor governmental and enterprise funds: Special Revenue Funds Special Revenue Funds are used to account for and report the proceeds of specific revenue sources that are restricted or committed to expenditures for specified purposes (other than debt service or capital projects). Police Restricted Foreign Fire Insurance Tax Emergency Telephone Parks and Public Land Motor Fuel Tax Senior Resources Commission Housing Trust Debt Service Fund Debt Service Fund is used to account for and report financial resources that are restricted, committed or assigned to expenditure for the payment of general long-term debt principal, interest and related costs. Capital Projects Fund Capital Projects Fund is used to account for and report financial resources that are restricted, committed or assigned to expenditure for capital outlays, including the acquisition or construction of capital facilities and other capital assets. Laurel/W estern Redevelopment TIF Enterprise Fund Enterprise Fund is used to account for and report any activity for which a fee is charged to external uses for goods or services and must be used for activities which meet certain debt or cost recovery criteria. Deerpath Golf Course In addition, the City reports the following fund types: Internal Service Funds Internal Service Funds are used to account for and report the financing of goods or services provided by one department or agency to other departments or agencies of the City or to other governmental units, on a cost-reimbursement basis. Fleet Self Insurance Liability Insurance Private-Purpose Trust Fund Private-Purpose Trust Fund is used to account for and report any trust arrangement not properly reported in a pension trust fund or investment trust fund under which principal and income benefit individuals, private organizations or other governments. Cemetery Trust 37 68 City of Lake Forest Notes to Financial Statements April 30, 2022 Pension Trust Funds Pension Trust Funds are used to account for and report resources that are required to be held in trust for the members and beneficiaries of defined benefit pension plans. Police Pension Firefighters' Pension Measurement Focus, Basis of Accounting and Financial Statement Presentation Government-Wide Financial Statements The government-wide statement of net position and statement of activities are reported using the economic resources measurement focus and the accrual basis of accounting. Under the accrual basis of accounting, revenues are recognized when earned and expenses are recorded when the liability is incurred or economic asset used. Revenues, expenses, gains, losses, assets and liabilities resulting from exchange and exchange-like transactions are recognized when the exchange takes place. Property taxes are recognized as revenues in the year for which they are levied. Taxes receivable for the following year are recorded as receivables and deferred inflows. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider are met. Special assessments are recorded as revenue when earned. Unbilled receivables are recorded as revenues when services are provided. As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. Interfund services provided and used are not eliminated in the process of consolidation. Fund Financial Statements Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recorded when they are both measurable and available. Available means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. For this purpose, the City considers revenues, except for property taxes and income taxes, to be available if they are collected within 90 days of the end of the current fiscal period. Revenues for property taxes are considered to be available if they are collected within 60 days of the end of the current fiscal year. Revenues for income taxes are considered to be available if they are collected within 120 days of the end of the current fiscal year. Expenditures are recorded when the related fund liability is incurred, except for unmatured interest on long-term debt, claims, judgments, compensated absences and pension expenditures, which are recorded as a fund liability when expected to be paid with expendable available financial resources. Property taxes are recorded in the year levied as receivables and deferred inflows. They are recognized as revenues in the succeeding year when services financed by the levy are being provided. Intergovernmental aids and grants are recognized as revenues in the period the City is entitled the resources and the amounts are available. Amounts owed to the City which are not available are recorded as receivables and unavailable revenues. Amounts received before eligibility requirements (excluding time requirements) are met are recorded as liabilities. Amounts received in advance of meeting time requirements are recorded as deferred inflows. Revenues susceptible to accrual include property taxes, miscellaneous taxes, public charges for services, special assessments and interest. Other general revenues such as fines and forfeitures, inspection fees, recreation fees and miscellaneous revenues are recognized when received in cash or when measurable and available under the criteria described above. 38 69 City of Lake Forest Notes to Financial Statements April 30, 2022 Proprietary and Fiduciary Funds Proprietary and fiduciary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as described previously in this note. The proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the Waterworks and Sewerage Fund and the Deerpath Golf Course Fund are charges to customers for sales and services. Special assessments are recorded as receivables and contribution revenue when levied. Operating expenses for proprietary funds include the cost of sales and services, administrative expenses and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. All Financial Statements The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets, deferred outflows of resources, liabilities and deferred inflows of resources and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenditures/expenses during the reporting period. Actual results could differ from those estimates. Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources and Net Position or Equity Deposits and Investments For purposes of the statement of cash flows, the City considers all highly liquid investments with an initial maturity of three months or less when acquired to be cash equivalents. The City and Library are authorized to invest in the following types of securities under Illinois law and the City's investment policy: Bonds, notes, certificates of indebtedness, treasury bills or other securities which are guaranteed by the full faith and credit of the United States of America; Bonds, notes, debentures or other similar obligations of U.S. Government or its agencies; Interest bearing bonds of any county, township, city, incorporated town, municipal corporation or school district and the bonds shall be registered in the name of the municipality or held under a custodial agreement at a bank, provided the bonds shall be rated at the time of purchase within the 4 highest general classifications established by a rating service of nationally recognized expertise in rating bonds of both states and their political subdivisions; Interest bearing savings accounts, interest bearing certificates of deposit, interest bearing deposits or any other investments constituting direct obligations of any bank as defined by the Illinois Banking Act (205 ILCS 5/1 et. seq.), provided, however, that such investments may be made in only banks which are insured by the Federal Deposit Insurance Corporation; 39 70 City of Lake Forest Notes to Financial Statements April 30, 2022 Commercial Paper - issuer must be a United States corporation with more than $500 million in assets, rating must be within the highest tier (e.g. A-1, P-1, F-1, D-1 or higher) by two standard rating services, must mature within 180 days of purchase, such purchases cannot exceed 10% of the corporation's outstanding obligations and such purchases cannot exceed one-third of funds; Money Market Mutual Funds - registered under the Investment Company Act of 1940 (15 U.S.C.A. § 80a-1 et. seq.), provided the portfolio is limited to bonds, notes, certificates, treasury bills or other securities which are guaranteed by the full faith and credit of the federal government as to principal and interest; Short term discount obligations of the Federal National Mortgage Association (established by or under the National Housing Act (1201 U.S.C. 1701 et. seq.)) or in shares or other forms of securities legally issuable by savings banks or savings and loans associations incorporated under the laws of Illinois or any other state or under the laws of the United States, provided, however, that the shares or investment certificates of such savings banks or savings and loans associations are insured by the Federal Deposit Insurance Corporation; Dividend-bearing share accounts, share certificate accounts or class of share accounts of a credit union chartered under the law of the State of Illinois or the laws of the United States; provided, however, the principal office of the credit unions must be located within the State of Illinois; and, provided further, that such investments may be made only in those credit union accounts of which are insured by applicable law; The Public Treasurer's Investment Pool created under Section 17 of the State Treasurer Act (15 ILCS 505/17) or in a fund managed, operated and administered by a bank subsidiary of a bank or subsidiary of a bank holding company or use the services of such an entity to hold and invest or advise regarding the investment of any public funds; and Repurchase agreements of government securities having the meaning set out in the Government Securities Act of 1986 (15 U.S.C.A § 780-5) subject to the provisions of that Act and the regulations issued there under, provided, however, that such government securities, unless registered or inscribed in the name of the City, shall be purchased through banks or trust companies authorized to do business in the State of Illinois; and such other repurchase agreements as are authorized in subsection (h) of Section 2 of the Public Funds Investment Act (30 ILCS 235/2). Repurchase agreements may be executed only with approved financial institutions or broker/dealers meeting the City's established standards, which shall include mutual execution of a Master Repurchase Agreement adopted by the City. The Lake Forest Cemetery Investment Fund is also permitted to invest in the following instruments: Common and preferred stock authorized for investments of trust funds under the laws of the State of Illinois limited to 60% of the fund's investments. In addition, Pension Funds are also permitted to invest in the following instruments: Common and preferred stock authorized for investments of trust funds under the laws of the State of Illinois limited to 35% of the fund's investments; General accounts of Illinois-licensed life insurance companies; 40 71 City of Lake Forest Notes to Financial Statements April 30, 2022 Separate accounts of Illinois-licensed insurance companies invested in stocks, bonds and real estate limited to 10% of the fund's investments; Bonds issued by any county, city, township, village, incorporated town, municipal corporation or school district in Illinois; and Tax anticipation warrants issued by any city, township, village, incorporated town or fire protection district in Illinois. Investments are stated at fair value, which is the amount at which an investment could be exchanged in a current transaction between willing parties. Fair values are based on quoted market prices. No investments are reported at amortized cost. Adjustments necessary to record investments at fair value are recorded in the operating statement as increases or decreases in investment income. Investment income on commingled investments of municipal accounting funds is allocated based on average balances. The difference between the bank statement balance and carrying value is due to outstanding checks and/or deposits in transit. Illinois Funds is an investment pool managed by the State of Illinois, Office of the Treasurer, which allows governments within the State to pool their funds for investment purposes. Illinois Funds is not registered with the SEC as an investment company, but does operate in a manner consistent with Rule 2a7 of the Investment Company Act of 1940. Investments in Illinois Funds are valued at Illinois Fund’s share price, the price for which the investments could be sold. Illinois Public Act 101-0610 consolidated the assets of the state's more than 650 downstate and suburban public safety pension funds into two consolidated investment funds and required the Firefighters' Pension Funds to pool their funds for investment purposes. Thus, the investments of the Firefighters' Pension Fund were transferred to Illinois Firefighters' Pension Investment Fund during the fiscal year. The Illinois Firefighters' Pension Investment Fund is an external investment pool valued at share price, the price for which the investments could be sold. The Police Pension Fund’s investment policy, in accordance with Illinois Statutes, establishes the following target allocation across asset classes: Asset Class Target Long-Term Expected Real Rate of Return Fixed income 35.00 % 1.60 % Domestic equities 39.00 5.20 International equities 15.00 5.60 Real estate 10.00 4.90 Cash and cash equivalents 1.00 0.20 Illinois Compiled Statues (ILCS) limit the Police Pension Fund's investments in equities, mutual funds and variable annuities to 65%. Securities in any one company should not exceed 5% of the total fund. The long-term expected rate of return on the Police Pension Fund's investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return (net of pension plan investment expense and inflation) were developed for each major asset class. These ranges were combined to produce long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the Police Pension Fund's target asset allocation are listed in the table above. 41 72 City of Lake Forest Notes to Financial Statements April 30, 2022 The Firefighters’ Pension Fund’s investment policy, in accordance with Illinois Statutes, establishes the following target allocation across asset classes: Asset Class Target Long-Term Expected Real Rate of Return Illinois Firefighters Pension Investment Fund 100 % 4.20 % The long-term expected rate of return on the Firefighters' Pension Fund's investments was determined using a building-block method in which best-estimate ranges of expected future real rates of return (net of pension plan investment expense and inflation) were developed for each major asset class. These ranges were combined to produce long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates or arithmetic real rates of return for each major asset class included in the Firefighters' Pension Fund's target asset allocation are listed in the table above. Interest Rate Risk Although the City and Cemetery Fund's investment policy does not specifically limit the length of maturity of investments, it requires that the City and Cemetery Funds to minimize the interest rate risk by structuring the investment portfolio so that securities mature to meet cash requirements for ongoing operations, thereby avoiding the need to sell securities on the open market prior to maturity and by investing operating funds primarily in short-term securities, money market mutual funds or similar investment pools. The Police Pension Fund's investment policy does not limit the length of maturity of investments since it is passively managing its fixed income exposure to the Barclays Capital Intermediate Government Index. Credit Risk The City's investment policy limits the City's exposure to credit risk by limiting investments to the safest types as described above. The Cemetery and Pension Funds' general investment policy is to follow the prudent person rule subject to specific restrictions of the Illinois Cemetery Care Act, the Illinois Pension Code and the respective Cemetery and Pension Fund's asset allocation policy. Under the prudent person rule, investments shall be made with care, skill, prudence and diligence under the prevailing circumstances that a prudent person acting in similar capacity and familiar with such matters would use in the investment of a fund or like character and with like aims. Concentration of Credit Risk The Cemetery and Police Pension Funds' investment policy further limits the investment in any one company or issuer to 5% of the funds' total assets. The Cemetery fund also limits the investment in any one equity industry group to no more than 15% of the Fund's assets. Custodial Credit Risk, Deposits The City's investment policy requires that deposits that exceed the amount insured by FDIC, NCUA and/or SPIC insurance should be collateralized at the rate of 110% of such deposits, by U.S. Government Securities, obligations of Federal instrumentalities, obligations of the state of Illinois or general obligation bonds of the City. The Cemetery Investment Fund and the Pension Funds do not have a deposit policy for custodial credit risk. 42 73 City of Lake Forest Notes to Financial Statements April 30, 2022 Custodial Credit Risk, Investments The investment policies for the City, Cemetery and Police Pension Fund require investment securities be held by an authorized custodial bank pursuant to a written custodial agreement. Investments are stated at fair value, which is the amount at which an investment could be exchanged in a current transaction between willing parties. Fair values are based on methods and inputs as outlined in Note 3. Adjustments necessary to record investments at fair value are recorded in the operating statement as increases or decreases in investment income. Investment income on commingled investments of municipal accounting funds is allocated based on average balances. See Note 3 for further information. Receivables Property taxes for levy year 2021 attaches as an enforceable lien on January 1, 2021, on property values assessed as of the same date. Taxes are levied by December following the lien date (by passage of a Tax Levy Ordinance). The 2022 tax levy, which attached as an enforceable lien on the property as of January 1, 2022, has not been recorded as a receivable as of April 30, 2022, as the tax has not yet been levied by the City and will not be levied until December 2022 and therefore, the levy is not measurable at April 30, 2022. Tax bills for levy year 2021 are prepared by Lake County and issued on or about May, 2022 and are payable in two installments, on or about June 1, 2022 and September 1, 2022 or within 30 days of the tax bills being issued. The County collects such taxes and remits them periodically. The 2021 property tax levy is recognized as a receivable and deferred inflows in fiscal 2022, net the 1.5% allowance for uncollectible. As the taxes become available to finance current expenditures, they are recognized as revenues. At April 30, 2022, the property taxes receivable and related deferred inflows consisted of the estimated amount collectible from the 2021 levy. During the course of operations, transactions occur between individual funds that may result in amounts owed between funds. Short-term interfund loans are reported as due to and from other funds. Long-term interfund loans (noncurrent portion) are reported as advances from and to other funds. Interfund receivables and payables between funds within governmental activities are eliminated in the statement of net position. Any residual balances outstanding between the governmental activities and business-type activities are reported in the governmental-wide financial statements as internal balances. Inventories and Prepaid Items Inventories are recorded at cost and are recorded as expenditures/expenses when consumed rather than when purchased. Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government-wide and fund financial statements. The cost of prepaid items is recorded as expenditures/expenses when consumed rather than when purchased. 43 74 City of Lake Forest Notes to Financial Statements April 30, 2022 Capital Assets Government-Wide Statements Capital assets, which include property, plant and equipment, are reported in the government- wide financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $10,000 and an estimated useful life in excess of one year. All capital assets are valued at historical cost or estimated historical cost if actual amounts are unavailable. Donated capital assets are recorded at their estimated acquisition value at the date of donation. Additions to and replacements of capital assets of business-type activities are recorded at original cost, which includes material, labor, overhead and an allowance for the cost of funds used during construction when significant. For tax-exempt debt, the amount of interest capitalized equals the interest expense incurred during construction netted against any interest revenue from temporary investment of borrowed fund proceeds. No interest was capitalized during the current year. The cost of renewals and betterments relating to retirement units is added to plant accounts. The cost of property replaced, retired or otherwise disposed of, is deducted from plant accounts and, generally, together with removal costs less salvage, is charged to accumulated depreciation. Depreciation and amortization of all exhaustible capital assets is recorded as an allocated expense in the statement of activities, with accumulated depreciation and amortization reflected in the statement of net position. Depreciation and amortization is provided over the assets' estimated useful lives using the straight-line method. The range of estimated useful lives by type of asset is as follows: Public domain infrastructure 20 - 60 Years Buildings 30 - 50 Years Improvements other than buildings 40 - 80 Years Vehicles, machinery, equipment and software 3 - 20 Years Water mains 40 Years Sanitary sewers 50 Years Fund Financial Statements In the fund financial statements, capital assets used in governmental fund operations are accounted for as capital outlay expenditures of the governmental fund upon acquisition. Capital assets used in proprietary fund operations are accounted for the same way as in the government-wide statements. Deferred Outflows of Resources A deferred outflow of resources represent a consumption of net assets that applies to a future period and will not be recognized as an outflow of resources (expense/expenditure) until that future time. A deferred charge on refunding arises from the advance refunding of debt. The difference between the cost of the securities placed in trust for future payments of the refunded debt and the net carrying value of that debt is deferred and amortized as a component of interest expense over the shorter of the term of the refunding issue or the original term of the refunded debt. The unamortized amount is reported as a deferred outflow of resources in the government-wide and proprietary fund financial statements. 44 75 City of Lake Forest Notes to Financial Statements April 30, 2022 Compensated Absences Under terms of employment, employees are granted sick leave and vacations in varying amounts. Only benefits considered to be vested are disclosed in these statements. All vested vacation and sick leave pay is accrued when incurred in the government-wide and proprietary fund financial statements. A liability for these amounts is reported in governmental funds only if they have matured, for example, as a result of employee resignations and retirements and are payable with expendable resources. Long-Term Obligations All long-term obligations to be repaid from governmental and business-type resources are reported as liabilities in the government-wide statements. The long-term obligations consist primarily of notes and bonds payable, net pension liabilities and accrued compensated absences. Long-term obligations for governmental funds are not reported as liabilities in the fund financial statements. The face value of debts (plus any premiums) are reported as other financing sources and payments of principal and interest are reported as expenditures. The accounting in proprietary funds is the same as it is in the government-wide statements. For the government-wide statements and proprietary fund statements, bond premiums and discounts are amortized over the life of the issue using the effective interest method. The balance at year end is shown as an increase or decrease in the liability section of the statement of net position. Deferred Inflows of Resources A deferred inflow of resources represent an acquisition of net assets that applies to a future period and therefore will not be recognized as an inflow of resources (revenue) until that future time. Equity Classifications Government-Wide Statements Equity is classified as net position and displayed in three components: a. Net Investment in Capital Assets - Consists of capital assets including restricted capital assets, net of accumulated depreciation and reduced by the outstanding balances (excluding unspent debt proceeds) of any bonds, mortgages, notes or other borrowings that are attributable to the acquisition, construction or improvement of those assets. b. Restricted Net Position - Consists of net position with constraints placed on their use either by 1) external groups such as creditors, grantors, contributors or laws or regulations of other governments or, 2) law through constitutional provisions or enabling legislation. c. Unrestricted Net Position - All other net positions that do not meet the definitions of restricted or net investment in capital assets. When both restricted and unrestricted resources are available for use, it is the City's policy to use restricted resources first, then unrestricted resources as they are needed. 45 76 City of Lake Forest Notes to Financial Statements April 30, 2022 Fund Statements Governmental fund balances are displayed as follows: a. Nonspendable - Includes fund balance amounts that cannot be spent either because they are not in spendable form or because legal or contractual requirements require them to be maintained intact. b. Restricted - Consists of fund balances with constraints placed on their use either by 1) external groups such as creditors, grantors, contributors or laws or regulations of other governments or 2) law through constitutional provisions or enabling legislation. c. Committed - Includes fund balance amounts that are constrained for specific purposes that are internally imposed by the government through formal action of the highest level of decision making authority. Fund balance amounts are committed through a formal action (resolution) of the City Council. This formal action must occur prior to the end of the reporting period, but the amount of the commitment, which will be subject to the constraints, may be determined in the subsequent period. Any changes to the constraints imposed require the same formal action of the City Council that originally created the commitment. d. Assigned - Includes spendable fund balance amounts that are intended to be used for specific purposes that do not meet the criteria to be classified as restricted or committed. Intent is expressed by: a) The City Council itself; or b) a body or official to which the City Council has delegated the authority to assign amounts to be used for specific purposes. Annually, the City Council approves the fiscal policy which delegates this authority to the City's Finance Director. W ithin the other governmental fund types (special revenue, debt service, capital projects) resources are assigned in accordance with the established fund purpose and approved budget/appropriation. Assignments may take place after the end of the reporting period. e. Unassigned - Includes residual positive fund balance within the general fund which has not been classified within the other above mentioned categories. Unassigned fund balance may also include negative balances for any governmental fund if expenditures exceed amounts restricted, committed or assigned for those purposes. Proprietary fund equity is classified the same as in the government-wide statements. In the General Fund, it is the City's policy to consider restricted resources to have been spent first when an expenditure is incurred for which both restricted and unrestricted (i.e. committed, assigned or unassigned) fund balances are available, followed by committed and then assigned fund balances. Unassigned amounts are only used after the other resources have been used. In other governmental funds (special revenue, capital projects and debt service fund types), it is the City's policy to consider restricted resources to have been spent last. When an expenditure is incurred for purposes for which both restricted and unrestricted fund balances are available, the City first uses any assigned amounts, followed by committed and then restricted amounts. See Note 3 for further information. Fiduciary fund net position is classified as restricted for pension benefits and other purposes on the statement of fiduciary net position. Various donor restrictions apply, including authorizing and spending trust income and the City believes it is in compliance with all significant restrictions. 46 77 City of Lake Forest Notes to Financial Statements April 30, 2022 2.Stewardship, Compliance and Accountability Budgetary Information The budget amounts represent the operating budget for the City and the appropriations represent the City's legal expenditure limit. The City Council follows these procedures in establishing the budgetary and appropriations data reflected in the financial statements: (1)The City Manager submits to the City Council a proposed operating budget for the fiscal year. The operating budget includes proposed expenditures and estimated revenues. (2)Public budget and appropriations meetings are conducted by the City to obtain taxpayer comments. (3)The budget and the appropriation ordinance, which is 10% higher than the budget, are both legally enacted through action of the City Council. Once enacted, the budget cannot be amended without approval from the City Council. Funds may have expenditures in excess of budgeted amounts, but legally may not have expenditures in excess of appropriations. (4)The legal level of budgetary control is the fund level. Management may make transfers of appropriations within a fund. Any expenditures that exceed the total appropriations at the fund level must be approved by the City Council. (5)Formal budgetary integration and legally adopted budgets are employed as a management control device during the year for the General and Special Revenue Funds, through an internal reporting system. Such budgetary integration permits the City's department managers to monitor actual revenues and expenditures relative to budgets on an ongoing basis throughout the year. Formal encumbrance accounting is not used and appropriations not used by the end of the fiscal year lapse. (6)Governmental fund budgets are adopted for all funds and are on a basis consistent with generally accepted accounting principles (GAAP). All proprietary funds have budgets and are generally in accordance with GAAP except that principal retirement is budgeted and depreciation expense is not budgeted. Additionally, the Pension Trust Funds adopted budgets which are generally in accordance with GAAP. Excess Expenditures Over Budget Funds Budgeted Expenditures Actual Expenditures Excess Expenditures Over Budget Self Insurance $6,367,900 $6,475,190 $107,290 Police Pension 3,529,869 3,559,221 29,352 47 78 City of Lake Forest Notes to Financial Statements April 30, 2022 3.Detailed Notes on All Funds Deposits and Investments The City's and Library's deposits and investments at year end were comprised of the following: Carrying Value Statement Balances Associated Risks Deposits $82,608,924 $83,068,516 Custodial Credit Risk, Deposits Mutual funds, other than bonds 24,534,188 24,534,188 N/A U.S. treasury obligations 7,961,878 7,961,878 Custodial Credit Risk, Investments, Interest Rate Risk Real estate investment fund 5,072,527 5,072,527 Custodial Credit Risk, Investments Municipal/corporate bonds 5,822,089 5,822,089 Credit Risk, Custodial Credit Risk, Investments, Concentration of Credit Risk, Interest Rate Risk Firefighters' investment pension fund 46,304,968 46,304,968 Credit Risk Illinois funds 12,667,356 12,667,356 Credit Risk Equity securities 5,776,442 5,776,442 Custodial Credit Risk, Investments, Foreign Currency Risk Mutual funds, bond funds 2,422,593 2,422,594 Credit Risk, Interest Rate Risk Petty cash 11,325 -N/A Total deposits and investments $193,182,290 $193,630,558 48 79 City of Lake Forest Notes to Financial Statements April 30, 2022 Reconciliation to financial statements Per statement of net position: Cash and cash equivalents, primary government $86,855,499 Investments, primary government 9,058,582 Cash and cash equivalents, Lake Forest Library 7,193,111 Per statement of net position, fiduciary funds: Private Purpose Trust, money markets 33,801 Private Purpose Trust, equity securities 389,404 Private Purpose Trust, mutual funds 297,451 Pension Trusts, cash 962,467 Pension Trusts, money markets 242,727 Pension Trusts, U.S. treasury obligations 7,961,878 Pension Trusts, Firefighters' pension investment fund 46,304,968 Pension Trusts, Municipal/corporate bonds 5,822,089 Pension Trusts, mutual funds 22,987,786 Pension Trusts, real estate investment fund 5,072,527 Total deposits and investments $193,182,290 Deposits in each local and area bank are insured by the FDIC in the amount of $250,000 for time and savings accounts (including NOW accounts) and $250,000 for demand deposit accounts (interest- bearing and noninterest-bearing). In addition, if deposits are held in an institution outside of the state in which the government is located, insured amounts are further limited to a total of $250,000 for the combined amount of all deposit accounts. The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. 49 80 City of Lake Forest Notes to Financial Statements April 30, 2022 The valuation methods for recurring fair value measurements are as follows: For Level 2 inputs, the City utilizes investments valued by a pricing service that uses matrix pricing. A Level 2 input would be a price or yield of a similar investment. The Police Pension Fund holds an investment in a real estate investment fund that is measured at the net asset value per share (or its equivalent). The fair value of this investment is $5,072,527 with no unfunded commitments. The investment is in one real-estate fund which invests in high quality, well-leased real estate properties in multifamily, industrial, office, retail and hotel sectors. Because it is not probable that any individual investment will be sold, the fair value of each individual investment has been determined using the NAV per share (or its equivalent). The Firefighters' Pension Fund's investment in the Illinois Firefighters' Pension Investment Fund is measured at the net asset value. City Ap ril 30, 2022 Investment Type Level 1 Level 2 Level 3 Total Equity securities $5,387,038 $-$-$5,387,038 Mutual funds, bond funds 2,253,127 --2,253,127 Mutual funds, other than bond funds 1,418,417 --1,418,417 Total $9,058,582 $-$-$9,058,582 Private Purpose Trust Ap ril 30, 2022 Investment Type Level 1 Level 2 Level 3 Total Equity securities $389,404 $-$-$389,404 Mutual funds, bond funds 169,466 --169,466 Mutual funds, other than bond funds 127,985 --127,985 Total $686,855 $-$-$686,855 Police Pension Fund Ap ril 30, 2022 Investment Type Level 1 Level 2 Level 3 Total U.S. treasury obligations $7,961,878 $-$-$7,961,878 Mutual funds, other than bond funds 22,987,786 --22,987,786 Municipal/corporate bonds -5,822,089 -5,822,089 Total $30,949,664 $5,822,089 $-$36,771,753 Custodial Credit Risk Deposits Custodial credit risk is the risk that in the event of a financial institution failure, the City's deposits may not be returned to the City. 50 81 City of Lake Forest Notes to Financial Statements April 30, 2022 The City does not have any deposits exposed to custodial credit risk. Investments For an investment, custodial credit risk is the risk that, in the event of the failure of the counterparty, the City will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. The City does not have any investments exposed to custodial credit risk. Credit Risk Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. As of April 30, 2022, the City's investments were rated as follows: Investment Type Standard & Poors Moody's Investors Services Illinois funds AAAm Not rated U.S. government agencies - implicitly guaranteed Municipal/corporate bonds BBB- to AAA Baa3 to Aaa Mutual funds, bond funds Not rated Not rated Illinois Firefighters Pension Investment Fund Not rated Not rated Interest Rate Risk Interest rate risk is the risk that changes in interest rates will adversely affect the value of an investment. As of April 30, 2022, the City's investments in mutual funds - bond funds were due in less than one year and the Police Pension Fund investments were as follows: Police Pension Fund Maturity (In Years) Investment Type Fair Value Less Than One Year 1 - 5 Years 6-10 Years U.S. treasury obligations $7,961,878 $197,446 $5,531,768 $2,232,664 Municipal/Corporate bonds 5,822,089 -3,096,608 2,725,481 Total $13,783,967 $197,446 $8,628,376 $4,958,145 Money-Weighted Rate of Return Police Pension Fund For the year ended April 30, 2022, the annual money-weighted rate of return on the Police Pension plan investments, net of pension plan investment expense, was (1.89)%. The money- weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested. 51 82 City of Lake Forest Notes to Financial Statements April 30, 2022 Firefighters' Pension Fund For the year ended April 30, 2022, the annual money-weighted rate of return on the Firefighters' Pension plan investments, net of pension plan investment expense, was (5.19)%. The money-weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested. See Note 1 for further information on deposit and investment policies. Receivables All of the receivables on the balance sheet are expected to be collected within one year. Governmental funds report unearned revenue to defer revenue recognition in connection with resources that have been received, but not yet earned. At the end of the current fiscal year, the various components of unearned revenue reported in the governmental funds were as follows: Unearned Vehicle licenses for subsequent year $1,018,258 Coronavirus Local Fiscal Recovery Funds 1,331,775 Recreation fees 623,513 Parking ticket fees 309,171 Miscellaneous 595,030 Total unearned/unavailable revenue for governmental funds $3,877,747 Capital Assets Capital asset activity for the year ended April 30, 2022, was as follows: Beginning Balance Additions Deletions Ending Balance Governmental Activities Capital assets not being depreciated: Land and land improvements $40,599,439 $2,308,361 $-$42,907,800 Infrastructure - land 66,740,770 --66,740,770 Construction in progress 135,800 -116,240 19,560 Total capital assets not being depreciated 107,476,009 2,308,361 116,240 109,668,130 Capital assets being depreciated: Infrastructure 188,294,958 --188,294,958 Buildings 30,002,059 574,600 -30,576,659 Improvements other than buildings 35,079,673 193,678 -35,273,351 Machinery and equipment 20,178,154 1,174,015 47,112 21,305,057 Total capital assets being depreciated 273,554,844 1,942,293 47,112 275,450,025 Total capital assets 381,030,853 4,250,654 163,352 385,118,155 52 83 City of Lake Forest Notes to Financial Statements April 30, 2022 Beginning Balance Additions Deletions Ending Balance Less accumulated depreciation for: Infrastructure $(137,361,250)$(2,347,856)$-$(139,709,106) Buildings (13,695,400)(665,411)-(14,360,811) Improvements other than buildings (20,863,069)(1,192,366)-(22,055,435) Machinery and equipment (15,945,189)(1,056,583)47,112 (16,954,660) Total accumulated depreciation (187,864,908)(5,262,216)47,112 (193,080,012) Net capital assets being depreciated 85,689,936 (3,319,923)-82,370,013 Total governmental activities capital assets, net of accumulated depreciation $193,165,945 $(1,011,562)$116,240 $192,038,143 Depreciation expense was charged to functions as follows: Governmental Activities General Government $1,305,735 Highways and streets 2,497,115 Sanitation 120,864 Culture and recreation 973,606 Public safety 364,896 Total governmental activities depreciation expense $5,262,216 Beginning Balance Additions Deletions Ending Balance Business-Type Activities Capital assets not being depreciated: Land $441,413 $302,236 $-$743,649 Construction in progress -874,375 -874,375 Total capital assets not being depreciated 441,413 1,176,611 -1,618,024 Capital assets being depreciated: Buildings 27,020,235 --27,020,235 Improvements other than buildings 57,920,654 460,804 -58,381,458 Machinery and equipment 5,593,614 46,334 -5,639,948 Sanitary sewers and related property 31,057,754 --31,057,754 Total capital assets being depreciated 121,592,257 507,138 -122,099,395 Total capital assets 122,033,670 1,683,749 -123,717,419 Less accumulated depreciation for: Buildings (18,613,134)(1,003,574)-(19,616,708) Improvements other than buildings (26,849,355)(1,430,368)-(28,279,723) Machinery and equipment (4,192,669)(338,719)-(4,531,388) Sanitary sewers and related property (19,480,303)(522,676)-(20,002,979) Total accumulated depreciation (69,135,461)(3,295,337)-(72,430,798) Net capital assets being depreciated 52,456,796 (2,788,199)-49,668,597 Business-type capital assets, net of accumulated depreciation $52,898,209 $(1,611,588)$-$51,286,621 53 84 City of Lake Forest Notes to Financial Statements April 30, 2022 Component Unit Capital assets not being depreciated: Land $70,000 $-$-$70,000 Art 168,500 --168,500 Total capital assets not being depreciated 238,500 --238,500 Capital assets being depreciated: Buildings 1,180,907 --1,180,907 Improvements other than buildings 2,271,093 -2 2,271,091 Machinery and equipment 3,821,804 290,089 355,403 3,756,490 Total capital assets being depreciated 7,273,804 290,089 355,405 7,208,488 Total capital assets 7,512,304 290,089 355,405 7,446,988 Less accumulated depreciation for: Buildings (786,642)(19,713)-(806,355) Improvements other than buildings (1,670,056)(63,615)-(1,733,671) Machinery and equipment (2,371,073)(341,312)355,405 (2,356,980) Total accumulated depreciation (4,827,771)(424,640)355,405 (4,897,006) Net capital assets being depreciated 2,446,033 (134,551)-2,311,482 Total component units capital assets, net of accumulated depreciation $2,684,533 $(134,551)$-$2,549,982 Interfund Receivables/Payables and Transfers Interfund Receivables/Payables The following is a schedule of interfund receivables and payables including any overdrafts on pooled cash and investment accounts: Receivable Fund Payable Fund Am ount Parks and Recreation Deerpath Golf Course $125,000 Total, fund financial statements 125,000 Less interfund receivables created with internal service fund eliminations (1,181,992) Total internal balances, government-wide statement of net position $(1,056,992) All amounts are due within one year. The principal purpose of these interfunds is for operating transactions between funds and will be paid within the normal course of business. 54 85 City of Lake Forest Notes to Financial Statements April 30, 2022 Transfers The following is a schedule of interfund transfers: Fund Transferred To Fund Transferred From Am ount Principal Purpose Parks and Recreation General $23,500 Funding for budgeted salary amounts Nonmajor enterprise Parks and Recreation 50,000 Funding for debt service payment Water and Sewer General 2,500 Funding for budgeted salary amounts Internal service General 650,000 Transfer to restore reserves Nonmajor government General 756,481 Funding for debt service payment Nonmajor government Nonmajor government 361,313 Funding for debt service payment Nonmajor government General 1,000,000 Funding for projects relating to the purposes of the Housing Trust as well as Parks and Public Land funds Capital Improvement General 3,650,000 Funding for capital outlay projects Capital Improvement Nonmajor government 500,000 Transfer for capital outlay Capital Improvement Nonmajor government 500,000 Funding for debt service payment Total, fund financial statements 7,493,794 Less government-wide eliminations (7,441,294) Total transfers, government-wide statement of activities $52,500 Generally, transfers are used to (1) move revenues from the fund that collects them to the fund that the budget requires to expend them, (2) move receipts restricted to debt service from the funds collecting the receipts to the debt service fund and (3) use unrestricted revenues collected in the general fund to finance various programs accounted for in other funds in accordance with budgetary authorizations. 55 86 City of Lake Forest Notes to Financial Statements April 30, 2022 Long-Term Obligations Long-term obligations activity for the year ended April 30, 2022, was as follows: Beginning Balance Increases Decreases Ending Balance Am ounts Due Within One Year Governmental Activities Bonds and notes payable: General obligation debt $27,631,868 $7,590,000 $10,029,665 $25,192,203 $2,192,956 Premiums 707,380 511,784 184,123 1,035,041 - Total bonds and notes payable 28,339,248 8,101,784 10,213,788 26,227,244 2,192,956 Other liabilities: Compensated absences 2,167,764 2,776,519 2,806,205 2,138,078 175,000 Total OPEB liability 2,058,647 200,429 309,237 1,949,839 - Net pension liability 44,127,517 11,489,279 2,984,406 52,632,390 - Total other liabilities 48,353,928 14,466,227 6,099,848 56,720,307 175,000 Total governmental activities long- term liabilities $76,693,176 $22,568,011 $16,313,636 $82,947,551 $2,367,956 Business-Type Activities Bonds and notes payable: General obligation debt $14,414,565 $-$1,871,947 $12,542,618 $1,976,252 Premium 341,465 -182,318 159,147 - Total bonds and notes payable 14,756,030 -2,054,265 12,701,765 1,976,252 Other liabilities: Compensated absences 267,604 283,694 277,225 274,073 5,000 Total OPEB liability 193,556 18,647 30,803 181,400 - Total other liabilities 461,160 302,341 308,028 455,473 5,000 Total business-type activities long- term liabilities $15,217,190 $302,341 $2,362,293 $13,157,238 $1,981,252 Component Unit Other liabilities: Compensated absences $108,922 $128,676 $138,571 $99,027 $5,000 Capital leases 48,065 -34,756 13,309 13,309 Total OPEB liability 159,877 5,693 36,077 129,493 - Total other liabilities 316,864 134,369 209,404 241,829 18,309 Total component units long-term liabilities $316,864 $134,369 $209,404 $241,829 $18,309 56 87 City of Lake Forest Notes to Financial Statements April 30, 2022 General Obligation Debt All general obligation debt payable is backed by the full faith and credit of the City. Debt in the governmental funds will be retired by future property tax levies accumulated by the Debt Service Fund. Business-type activities debt is payable by revenues from user fees of those funds or, if the revenues are not sufficient, by future tax levies. Governmental Activities General Obligation Debt Date of Issue Final Maturity Interest Rates Original Indebtedness Balance April 30, 2022 Special Service Area 25 5/1/2003 12/15/2022 1.95-2.95%$1,050,000 $75,000 Special Service Area 26 10/7/2003 12/15/2022 2.50-3.40%276,500 20,701 Special Service Area 29 12/20/2004 12/15/2023 2.55-3.65%2,000,000 294,120 2015 Series 8/3/2015 12/15/2036 2.50-3.75%9,780,000 8,420,000 2019 Series Refunding 12/19/2019 12/15/2032 2.00-5.00%10,751,022 8,792,382 2021 Series Refunding 9/15/2021 12/15/2032 2.00%7,590,000 7,590,000 Total governmental activities, general obligation debt $25,192,203 Business-Type Activities General Obligation Debt Date of Issue Final Maturity Interest Rates Original Indebtedness Balance April 30, 2022 2017 Series 6/5/2017 12/15/2037 2.00-3.50%$9,295,000 $9,295,000 2019 Series Refunding 12/15/2019 12/15/2032 2.00-5.00%6,913,978 3,247,618 Total business-type activities, general obligation debt $12,542,618 Debt service requirements to maturity are as follows: Governmental Activities Business-Type Activities General Obligation Debt General Obligation Debt Years Principal Interest Principal Interest 2023 $2,192,956 $769,116 $1,976,252 $433,540 2024 2,209,247 650,841 1,786,366 334,721 2025 1,615,000 569,363 525,000 260,853 2026 1,680,000 516,238 535,000 247,728 2027 1,720,000 460,813 550,000 234,352 2028-2032 10,790,000 1,558,887 2,975,000 948,442 2033-2037 4,985,000 314,787 3,435,000 479,087 2038 --760,000 26,600 Total $25,192,203 $4,840,045 $12,542,618 $2,965,323 Other Debt Information Estimated payments of compensated absences, total OPEB liability and net pension liability are not included in the debt service requirement schedules. The compensated absences will be liquidated by the applicable governmental funds (primarily the General, Parks and Recreation, Senior Commission and Cemetery Funds) that account for the salaries and wages for the related employees. Total OPEB liability and the Police and Firefighters' net pension liability attributable to governmental activities will be liquidated primarily by the General Fund. 57 88 City of Lake Forest Notes to Financial Statements April 30, 2022 Current Refunding On September 15, 2021, the City issued $7,590,000 in general obligation bonds with an average coupon rate of 2.00% to refund $8,020,000 of outstanding bonds with an average coupon rate of 3.87%. The cash flow requirements on the refunded debt prior to the current refunding was $10,248,400 from 2022 through 2032. The cash flow requirements on the 2021 refunding bonds are $8,614,250 from 2022 through 2032. The current refunding resulted in an economic gain (difference between the present values of the debt service payments on the old and new debt) of $1,480,390. Lease Disclosures Lessee, Capital Leases In 2020, the library acquired capital assets through a lease/purchase agreement. The gross amount of these assets under capital leases is $105,225, which are included in capital assets in the discretely presented component unit activities. The future minimum lease obligations and the net present value on these minimum lease payments as of April 30, 2022, are as follows: Component Unit Years Principal Interest Total 2023 $13,309 $30 $13,339 Total $13,309 $30 $13,339 Net Position/Fund Balances Net position reported on the government-wide statement of net position at April 30, 2022, includes the following: Governmental Activities Net investment in capital assets: Capital assets not being depreciated $109,668,130 Capital assets being depreciated, net of accumulated depreciation 82,370,013 Less long-term debt outstanding (25,192,203) Less unamortized debt premium (1,035,041) Plus unamortized deferred charge 151 Total net investment in capital assets $165,811,050 58 89 City of Lake Forest Notes to Financial Statements April 30, 2022 Governmental Funds Governmental fund balances reported on the fund financial statements at April 30, 2022, include the following: General Fund Parks and Recreation Fund Capital Improvements Fund General Cemetery Fund Nonmajor Governmental Funds Total Fund Balances Nonspendable: Inventories $91,038 $-$-$-$-$91,038 Subtotal 91,038 ----91,038 Restricted for: Culture and recreation -1,881,221 --2,497,386 4,378,607 Highway and streets ----2,395,746 2,395,746 Public safety, fire ----215,927 215,927 Public safety, police ----1,416,951 1,416,951 Cemetery perpetual care ---10,643,506 -10,643,506 Affordable housing ----2,183,485 2,183,485 Capital projects --22,340,775 -5,999 22,346,774 Debt service ----1,594,460 1,594,460 Subtotal -1,881,221 22,340,775 10,643,506 10,309,954 45,175,456 Unassigned:28,872,687 ----28,872,687 Total fund balances $28,963,725 $1,881,221 $22,340,775 $10,643,506 $10,309,954 $74,139,181 Business-Type Activities Net investment in capital assets: Capital assets not being depreciated $1,618,024 Capital assets being depreciated, net of accumulated depreciation 49,668,597 Less Long-term debt outstanding (12,542,618) Less unamortized debt premium (159,147) Plus unamortized deferred charge 214 Total net investment in capital assets $38,585,070 4.Other Information Employees' Retirement System The City contributes to three defined benefit pension plans, the Illinois Municipal Retirement Fund (IMRF), an agent-multiple-employer public employee retirement system; the Police Pension Plan which is a single-employer pension plan; and the Firefighters' Pension Plan which is a single-employer pension plan. The benefits, benefit levels, employee contributions and employer contributions for the plans are governed by Illinois Compiled Statutes and can only be amended by the Illinois General Assembly. The Police Pension Plan and the Firefighters' Pension Plan do not issue separate reports on the pension plans. IMRF does issue a publicly available report that includes financial statements and supplementary information for the plan as a whole, but not for individual employers. That report can be obtained from IMRF, 2211 York Road, Suite 500, Oak Brook, Illinois 60523. This report is also available for download at www.imrf.org. 59 90 City of Lake Forest Notes to Financial Statements April 30, 2022 For the year ended April 30, 2022, the City recognized the following balances in the government-wide financial statements: Total Pension Liability Net Pension Liability Deferred Outflows of Resources Deferred Inflows of Resources Pension Expense IMRF $107,135,715 $-$1,810,007 $15,258,500 $(4,210,324) Police Pension Plan 75,529,445 32,917,571 2,906,127 819,757 3,917,352 Firefighters' Pension Plan 66,590,834 19,714,819 3,780,084 -2,709,565 Total $249,255,994 $52,632,390 $8,496,218 $16,078,257 $2,416,593 Illinois Municipal Retirement Fund Plan Description All employees (other than those covered by the Police and Firefighters' Pension plans) hired in positions that meet or exceed the prescribed annual hourly standard must be enrolled in IMRF as participating members. IMRF has a two tier plan. Members who first participated in IMRF or an Illinois Reciprocal System prior to January 1, 2011 participate in Tier 1. All other members participate in Tier 2. For Tier 1 participants, pension benefits vest after 8 years of service. Participating members who retire at age 55 (at reduced benefits) or after age 60 (at full benefits) with 8 years of service are entitled to an annual retirement benefit, payable monthly for life in an amount equal to 1-2/3% of their final rate of earnings (average of the highest 48 consecutive months' earnings during the last 10 years) for credited service up to 15 years and 3% for each year thereafter to a maximum of 75% of their final rate of earnings. Em ployees hired on or after January 1, 2011, are eligible for Tier 2 benefits. For Tier 2 participants, pension benefits vest after 10 years of service. Participating members who retire at age 62 (at reduced benefits) or after age 67 (at full benefits) with 10 years of service are entitled to an annual retirement benefit, payable monthly for life in an amount equal to 1-2/3% of their final rate of earnings for the first 15 years of service credit, plus 2% for each year of service after 15 years to a maximum of 75% of their final rate of earnings. Final rate of earnings is the highest total earnings during any 96 consecutive months within the last 10 years of service, divided by 96. Under Tier 2, the pension is increased ever year after retirement, upon reaching age 67, by the lesser of 3% of the original pension amount or 1/2 of the increase in the Consumer Price Index of the original pension amount. Under the employer number within IMRF, both the City and Library contribute to the plan. As a result, IMRF is considered to be an agent multiple-employer plan through which cost-sharing occurs between the City and Library. Plan Membership At December 31, 2021, the measurement date, membership in the plan was as follows: Retirees and beneficiaries 306 Inactive, nonretired members 191 Active members 191 Total 688 60 91 City of Lake Forest Notes to Financial Statements April 30, 2022 Contributions As set by statute, City and Library employees participating in IMRF are required to contribute 4.50% of their annual covered salary. The statute requires the City and Library to contribute the amount necessary, in addition to member contributions, to finance the retirement coverage of its own employees. The City and Library’s actuarially determined contribution rate for calendar year 2021 was 11.66% of annual covered payroll for IMRF. The City and Library also contribute for disability benefits, death benefits and supplemental retirement benefits, all of which are pooled at the IMRF level. Contribution rates for disability and death benefits are set by the IMRF Board of Trustees, while the supplemental retirement benefits rate is set by statute. Net Pension Liability/(Asset) The net pension liability/(asset) was measured as of December 31, 2021 and the total pension liability used to calculate the net pension liability/(asset) was determined by an actuarial valuation as of that date. Summary of Significant Accounting Policies For purposes of measuring the net pension liability/(asset), deferred outflows of resources and deferred inflows of resources related to pensions and pension expense, information about the fiduciary net position of IMRF and additions to/deductions from IMRF fiduciary net position have been determined on the same basis as they are reported by IMRF. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. Actuarial Assumptions The total pension liability for IMRF was determined by actuarial valuations performed as of December 31, 2021 using the following actuarial methods and assumptions: Actuarial cost method Entry Age Normal Asset valuation method Fair Value Actuarial assumptions Investment Rate of Return 7.25% Salary increases 2.85% to 13.75%, including inflation Price inflation 2.25% Mortality For nondisabled retirees, the Pub-2010, Amount-W eighted, below median income, General, Retiree, Male (adjusted 106%) and Female (adjusted 105%) tables and future mortality improvements projected using scale MP-2020. For disabled retirees, the Pub-2010, Amount- Weighted, below median income, General, Disabled Retiree, Male and Female (both unadjusted) tables and future mortality improvements projected using scale MP-2020. For active members, the Pub-2010, Amount-W eighted, below median income, General, Em ployee, Male and Female (both unadjusted) tables and future mortality improvements projected using scale MP-2020. 61 92 City of Lake Forest Notes to Financial Statements April 30, 2022 Long-Term Expected Real Rate of Return The long-term expected rate of return on pension plan investments was determined using an asset allocation study in which best-estimate ranges of expected future real rates of return (net of pension plan investment expense and inflation) were developed for each major asset class. These ranges were combined to produce long-term expected rate of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic and geometric real rates of return for each major asset class are summarized in the following table: Projected Returns/Risks Asset Class Target Allocation One Year Arithmetic Ten Year Geometric Equities %39.00 %5.85 %4.50 International equities 15.00 7.40 5.75 Fixed income 25.00 2.10 2.00 Real estate 10.00 6.80 5.90 Alternatives 10.00 Private equity 11.45 8.10 Hedge funds -- Commodities 5.50 4.30 Cash equivalents 1.00 1.70 1.70 Discount Rate The discount rate used to measure the total pension liability for IMRF was 7.25%. The discount rate calculated using the December 31, 2020 measurement date was 7.25%. The projection of cash flows used to determine the discount rate assumed that member contributions will be made at the current contribution rate and that City and Library contributions will be made at rates equal to the difference between actuarially determined contribution rate and the member rate. Based on those assumptions, the fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on investments was applied to all periods of projected benefits to determine the total pension liability. Discount Rate Sensitivity The following is a sensitivity analysis of the net pension liability/(asset) to changes in the discount rate. The table below presents the net pension liability/(asset) of the City and Library calculated using the discount rate of 7.25% as well as what the net pension liability/(asset) would be if it were to be calculated using a discount rate that is 1 percentage point lower (6.25%) or 1 percentage point higher (8.25%) than the current rate: 1% Decrease Current Discount Rate 1% Increase City: Total pension liability $119,155,018 $107,135,715 $97,477,155 Plan fiduciary net position 121,937,634 121,937,634 121,937,634 Net pension liability/(asset)$(2,782,616)$(14,801,919)$(24,460,479) 62 93 City of Lake Forest Notes to Financial Statements April 30, 2022 1% Decrease Current Discount Rate 1% Increase Library: Total pension liability $15,238,872 $13,701,711 $12,466,466 Plan fiduciary net position 15,179,647 15,179,647 15,179,647 Net pension liability/(asset)$59,225 $(1,477,936)$(2,713,181) Total: Total pension liability $134,393,890 $120,837,426 $109,943,621 Plan fiduciary net position 137,117,281 137,117,281 137,117,281 Net pension liability/(asset)$(2,723,391)$(16,279,855)$(27,173,660) Changes in Net Pension Liability/(Asset) The changes in net pension liability/(asset)for the calendar year ended December 31, 2021 were as follows: Increase (Decrease) Total Pension Liability (a) Plan Fiduciary Net Position (b) Net Pension Liability/(Asset) (a) - (b) City: Balances at December 31, 2020 $102,234,444 $106,588,373 $(4,353,929) Service cost 1,192,260 -1,192,260 Interest on total pension liability 7,443,020 -7,443,020 Differences between expected and actual experience of the total pension liability 2,050,858 -2,050,858 Change of assumptions (14,992)-(14,992) Benefit payments, including refunds of employee contributions (5,769,875)(5,769,875)- Contributions, employer -1,553,376 (1,553,376) Contributions, employee -645,521 (645,521) Net investment income -18,659,240 (18,659,240) Other (net transfer)-260,999 (260,999) Balances at December 31, 2021 $107,135,715 $121,937,634 $(14,801,919) 63 94 City of Lake Forest Notes to Financial Statements April 30, 2022 Increase (Decrease) Library: Total Pension Liability (a) Plan Fiduciary Net Position (b) Net Pension Liability/(Asset) (a) - (b) Balances at December 31, 2020 $13,195,841 $13,647,060 $(451,219) Service cost 119,044 -119,044 Interest on total pension liability 743,169 -743,169 Differences between expected and actual experience of the total pension liability 204,773 -204,773 Change of assumptions 14,992 -14,992 Benefit payments, including refunds of employee contributions (576,108)(576,108)- Contributions, employer -155,101 (155,101) Contributions, employee -64,454 (64,454) Net investment income -1,863,080 (1,863,080) Other (net transfer)-26,060 (26,060) Balances at December 31, 2021 $13,701,711 $15,179,647 $(1,477,936) Total: Balances at December 31, 2020 $115,430,285 $120,235,433 $(4,805,148) Service cost 1,311,304 -1,311,304 Interest on total pension liability 8,186,189 -8,186,189 Differences between expected and actual experience of the total pension liability 2,255,631 -2,255,631 Benefit payments, including refunds of employee contributions (6,345,983)(6,345,983)- Contributions, employer -1,708,477 (1,708,477) Contributions, employee -709,975 (709,975) Net investment income -20,522,320 (20,522,320) Other (net transfer)-287,059 (287,059) Balances at December 31, 2021 $120,837,426 $137,117,281 $(16,279,855) Plan fiduciary net position as a percentage of the total pension liability %113.47 Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions For the year ended April 30, 2022, the City and Library recognized pension expense of $(4,210,324) and $(420,391), respectively. The City and Library reported deferred outflows and inflows of resources related to pension from the following sources: Deferred Outflows of Resources Deferred Inflows of Resources City: Difference between expected and actual experience $1,402,201 $284,299 Assumption changes -290,481 Net difference between projected and actual earnings on pension plan investments -14,683,720 Contributions subsequent to the measurement date 407,806 - Total $1,810,007 $15,258,500 64 95 City of Lake Forest Notes to Financial Statements April 30, 2022 Deferred Outflows of Resources Deferred Inflows of Resources Library: Difference between expected and actual experience $156,657 $28,387 Assumption changes -29,004 Net difference between projected and actual earnings on pension plan investments -1,466,135 Contributions subsequent to the measurement date 45,561 - Total $202,218 $1,523,526 Total: Difference between expected and actual experience $1,558,858 $312,686 Assumption changes -319,485 Net difference between projected and actual earnings on pension plan investments -16,149,855 Contributions subsequent to the measurement date 453,367 - Total $2,012,225 $16,782,026 The amount reported as deferred outflows resulting from contributions subsequent to the measurement date in the above table will be recognized as a reduction in the net pension liability/(asset) for the year ending April 30, 2023. The remaining amounts reported as deferred outflows and inflows of resources related to pensions is $(15,223,168) and will be recognized in pension expense as follows: Year Ending December 31,City Library Total 2022 $(3,029,026)$(298,801)$(3,327,827) 2023 (5,032,037)(496,391)(5,528,428) 2024 (3,622,159)(357,312)(3,979,471) 2025 (2,173,077)(214,365)(2,387,442) Total $(13,856,299)$(1,366,869)$(15,223,168) Police Pension Plan Description Police sworn personnel are covered by the Police Pension Plan, which is a defined benefit single-employer pension plan. Although this is a single employer pension plan, the defined benefits and employee and employer contribution levels are governed by Illinois State Statutes (Chapter 40 ILCS 5/3) and may be amended only by the Illinois legislature. The City accounts for the plan as a pension trust fund. As provided for in the Illinois Compiled Statutes, the Plan provides retirement benefits as well as death and disability benefits to employees grouped into two tiers. Tier 1 is for employees hired prior to January 1, 2011 and Tier 2 is for employees hired after that date. The following is a summary of the Police Pension Fund as provided for in Illinois Compiled Statutes. 65 96 City of Lake Forest Notes to Financial Statements April 30, 2022 Tier 1 - Covered employees attaining the age of 50 or more with 20 or more years of creditable service are entitled to receive an annual retirement benefit of one half of the salary attached to the rank on the last day of service or for one year prior to the last day, whichever is greater. The pension shall be increased by 2.5% of such salary for each additional year of service over 20 years up to 30 years to a maximum of 75% of such salary. Employees with at least 8 years but less than 20 years of credited service may retire at or after age 60 and receive a reduced retirement benefit. The monthly pension of a police officer who retired with 20 or more years of service after January 1, 1977 shall be increased annually, following the first anniversary date of retirement and paid upon reaching at least the age 55, by 3% of the original pension and 3% compounded annually thereafter. Tier 2 - Covered employees attaining the age of 55 or more with 10 or more years of creditable service are entitled to receive a monthly pension of 2.5% of the final average salary for each year of creditable service. The salary is initially capped at $106,800 but increases annually thereafter and is limited to 75% of final average salary. Employees with 10 or more years of creditable service may retire at or after age 50 and receive a reduced retirement benefit. The monthly pension of a police shall be increased annually on the January 1 occurring either on or after the attainment of age 60 or the first anniversary of the pension start date, whichever is later. Each annual increase shall be calculated at 3% or one-half the annual unadjusted percentage increase in the CPI, whichever is less. Plan Membership At April 30, 2022, the Police Pension membership consisted of: Retirees and beneficiaries 45 Inactive, nonretired members 10 Active members 40 Total 95 Contributions Covered employees are required to contribute 9.91% of their base salary to the Police Pension Plan. If an employee leaves covered employment with less than 20 years of service, accumulated employee contributions may be refunded without accumulated interest. The City is required to contribute the remaining amounts necessary to finance the plans as actuarially determined by an enrolled actuary. Effective January 1, 2011 the City’s contributions must accumulate to the point where the past service cost for the Police Pension Plan is 90% funded by the year 2041. The City's actuarially determined contribution rate for the fiscal year ending April 30, 2022 was 74.64% of annual covered payroll. Net Pension Liability/(Asset) The net pension liability/(asset) was measured as of April 30, 2022 and the total pension liability used to calculate the net pension liability/(asset) was determined by an annual actuarial valuation as of that date. 66 97 City of Lake Forest Notes to Financial Statements April 30, 2022 Summary of Significant Accounting Policies The financial statements of the Police Pension Plan are prepared using the accrual basis of accounting. Plan member contributions are recognized in the period in which contributions are due. The City’s contributions are recognized when due and a formal commitment to provide the contributions are made. Benefits and refunds are recognized when due and payable in accordance with the terms of the plan. Plan investments are reported at fair value. Short-term investments are reported at cost, which approximated fair value. Investments that do not have an established market are reported at estimated fair values. Actuarial Assumptions The total pension liability was determined by an actuarial valuation performed as of April 30, 2022 using the following actuarial methods and assumptions: Actuarial cost method Entry Age Normal Asset valuation method Fair Value Actuarial assumptions Interest rate 6.50% Inflation 2.50% Projected salary increases Service Based Cost-of-living adjustments Tier 1: 3.00% Tier 2: 1.25% Mortality rates for active lives, inactive lives, survivor lives and disabled lives were based on the PubS-2010 Employee Mortality Table with generational improvement Scale MP- 2020. Ten percent of active deaths are assumed to be in the line of duty. The actuarial assumptions were based on the results of an actuarial experience study conducted by the Illinois Department of Insurance dated March 4, 2022. Discount Rate The discount rate used to measure the total pension liability for the Police Pension Plan was 6.50%, the same as the prior valuation. The projection of cash flows used to determine the discount rate assumed that member contributions will be made at the current contribution rate and that City contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on Plan investments was applied to all periods of projected benefit payments to determine the total pension liability. 67 98 City of Lake Forest Notes to Financial Statements April 30, 2022 Discount Rate Sensitivity The following is a sensitivity analysis of the net pension liability to changes in the discount rate. The table below presents the pension liability of the City calculated using the discount rate of 6.50% as well as what the net pension liability would be if it were to be calculated using a discount rate that is 1 percentage point lower (5.50%) or 1 percentage point higher (7.50%) than the current rate: 1% Decrease Current Discount Rate 1% Increase Total pension liability $86,527,885 $75,529,445 $66,607,183 Plan fiduciary net position 42,611,874 42,611,874 42,611,874 Net pension liability $43,916,011 $32,917,571 $23,995,309 Changes in Net Pension Liability/(Asset) The City's changes in net pension liability/(asset) for the year ended April 30, 2022 was as follows: Increase (Decrease) Total Pension Liability (a) Plan Fiduciary Net Position (b) Net Pension Liability/Asset (a) - (b) Balances at April 30, 2021 $73,432,245 $43,199,932 $30,232,313 Service cost 948,636 -948,636 Interest on total pension liability 4,721,027 -4,721,027 Differences between expected and actual experience of the total pension liability (360,851)-(360,851) Change of assumptions 287,776 -287,776 Benefit payments, including refunds of employee contributions (3,499,388)(3,499,388)- Contributions, employer -3,379,444 (3,379,444) Contributions, employee -474,816 (474,816) Net investment income -(888,628)888,628 Administration -(54,302)54,302 Balances at April 30, 2022 $75,529,445 $42,611,874 $32,917,571 Plan fiduciary net position as a percentage of the total pension liability %56.42 68 99 City of Lake Forest Notes to Financial Statements April 30, 2022 Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions For the year ended April 30, 2022, the City recognized pension expense of $3,917,352. The City reported deferred outflows and inflows of resources related to pension from the following sources: Deferred Outflows of Resources Deferred Inflows of Resources Difference between expected and actual experience $1,025,804 $819,757 Assumption changes 1,872,242 - Net difference between projected and actual earnings on pension plan investments 8,081 - Total $2,906,127 $819,757 The amounts reported as deferred outflows and inflows of resources related to pensions is $2,086,370 and will be recognized in pension expense as follows: Year Ending April 30,Am ount 2023 $1,491,525 2024 241,270 2025 (363,345) 2026 729,101 2027 (12,181) Total $2,086,370 Firefighters' Pension Plan Description Fire sworn personnel are covered by the Firefighters' Pension Plan, which is a defined benefit single-employer pension plan. Although this is a single employer pension plan, the defined benefits and employee and employer contribution levels are governed by Illinois State Statutes (Chapter 40 ILCS 5/3) and may be amended only by the Illinois legislature. The City accounts for the plan as a pension trust fund. As provided for in the Illinois Compiled Statutes, the Firefighters' Pension Plan provides retirement benefits as well as death and disability benefits to employees grouped into two tiers. Tier 1 is for employees hired prior to January 1, 2011 and Tier 2 is for employees hired after that date. The following is a summary of the Firefighters' Pension Plan as provided for in Illinois Compiled Statutes. 69 100 City of Lake Forest Notes to Financial Statements April 30, 2022 Tier 1 - Covered employees attaining the age of 50 or more with 20 or more years of creditable service are entitled to receive a monthly retirement benefit of one half of the monthly salary attached to the rank held in the fire service at the date of retirement. The monthly pension shall be increased by one twelfth of 2.5% of such monthly salary for each additional month over 20 years of service through 30 years of service to a maximum of 75% of such monthly salary. Employees with at least 10 years but less than 20 years of credited service may retire at or after age 60 and receive a reduced retirement benefit. The monthly pension of a firefighter who retired with 20 or more years of service after January 1, 1977 shall be increased annually, following the first anniversary date of retirement and paid upon reaching at least the age 55, by 3% of the original pension and 3% compounded annually thereafter. Tier 2 - Covered employees attaining the age of 55 or more with 10 or more years of creditable service are entitled to receive a monthly pension of 2.5% of the final average salary for each year of creditable service. The salary is initially capped at $106,800 but increases annually thereafter and is limited to 75% of final average salary. Employees with 10 or more years of creditable service may retire at or after age 50 and receive a reduced retirement benefit. The monthly pension of a firefighter shall be increased annually on the January 1 occurring either on or after the attainment of age 60 or the first anniversary of the pension start date, whichever is later. Each annual increase shall be calculated at 3% or one-half the annual unadjusted percentage increase in the CPI, whichever is less. Plan Membership At April 30, 2022, the Firefighters' Pension Plan membership consisted of: Retirees and beneficiaries 46 Inactive, nonretired members 2 Active members 33 Total 81 Contributions Participants contribute a fixed percentage of their base salary to the plans. At April 30, 2022, the contribution percentage was 9.455%. If a participant leaves covered employment with less than 20 years of service, accumulated participant contributions may be refunded without accumulated interest. The City is required to contribute the remaining amounts necessary to finance the plans as actuarially determined by an enrolled actuary. Effective January 1, 2011 the City’s contributions must accumulate to the point where the past service cost for the Firefighters' Pension Plan is 90% funded by the year 2040. The City's actuarially determined contribution rate for the fiscal year ending April 30, 2022 was 68.08% of annual covered payroll. Net Pension Liability/(Asset) The net pension liability/(asset) was measured as of April 30, 2022 and the total pension liability used to calculate the net pension liability/(asset) was determined by an annual actuarial valuation as of that date. 70 101 City of Lake Forest Notes to Financial Statements April 30, 2022 Summary of Significant Accounting Policies The financial statements of the Firefighters' Pension Plan are prepared using the accrual basis of accounting. Plan member contributions are recognized in the period in which contributions are due. The City’s contributions are recognized when due and a formal commitment to provide the contributions are made. Benefits and refunds are recognized when due and payable in accordance with the terms of the plan. Plan investments are reported at fair value. Short-term investments are reported at cost, which approximated fair value. Investments that do not have an established market are reported at estimated fair values. Actuarial Assumptions The total pension liability was determined by an actuarial valuation performed as of April 30, 2022 using the following actuarial methods and assumptions: Actuarial cost method Entry Age Asset valuation method 5-year average Fair Value Actuarial assumptions Interest rate 6.50% Inflation 2.50% Projected salary increases Service based Cost-of-living adjustments Tier 1: 3.00% Tier 2: 1.25% Mortality rates for active lives, inactive lives, survivor lives and disabled lives were based on the PubS-2010 Employee Mortality Table with generational improvement Scale MP-2020. Twenty percent of active deaths are assumed to be in the line of duty. The actuarial assumptions were based on the results of an actuarial experience study conducted by the Illinois Department of Insurance dated December 1, 2021. Discount Rate The discount rate used to measure the total pension liability for the Firefighters' Pension Plan was 6.50%, the same as the prior valuation. The projection of cash flows used to determine the discount rate assumed that member contributions will be made at the current contribution rate and that City contributions will be made at rates equal to the difference between actuarially determined contribution rates and the member rate. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on Plan investments was applied to all periods of projected benefit payments to determine the total pension liability. 71 102 City of Lake Forest Notes to Financial Statements April 30, 2022 Discount Rate Sensitivity The following is a sensitivity analysis of the net pension liability to changes in the discount rate. The table below presents the pension liability of the City calculated using the discount rate of 6.50% as well as what the net pension liability would be if it were to be calculated using a discount rate that is 1 percentage point lower (5.50%) or 1 percentage point higher (7.50%) than the current rate: 1% Decrease Current Discount Rate 1% Increase Total pension liability $76,088,830 $66,590,834 $58,864,655 Plan fiduciary net position 46,876,015 46,876,015 46,876,015 Net pension liability $29,212,815 $19,714,819 $11,988,640 Changes in Net Pension Liability/(Asset) The City's changes in net pension liability/(asset) for the year ended April 30, 2022 was as follows: Increase (Decrease) Total Pension Liability (a) Plan Fiduciary Net Position (b) Net Pension Liability/Asset (a) - (b) Balances at April 30, 2021 $63,740,015 $49,844,811 $13,895,204 Service cost 1,006,247 -1,006,247 Interest on total pension liability 4,107,962 -4,107,962 Differences between expected and actual experience of the total pension liability 150,101 -150,101 Change of assumptions 680,212 -680,212 Benefit payments, including refunds of employee contributions (3,093,703)(3,093,703)- Contributions, employer -2,398,803 (2,398,803) Contributions, employee -343,611 (343,611) Net investment income -(2,576,122)2,576,122 Administration -(41,385)41,385 Balances at April 30, 2022 $66,590,834 $46,876,015 $19,714,819 Plan fiduciary net position as a percentage of the total pension liability %70.39 72 103 City of Lake Forest Notes to Financial Statements April 30, 2022 Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions For the year ended April 30, 2022, the City recognized pension expense of $2,709,565. The City reported deferred outflows and inflows of resources related to pension from the following sources: Deferred Outflows of Resources Deferred Inflows of Resources Difference between expected and actual experience $1,003,186 $- Assumption changes 2,551,030 - Net difference between projected and actual earnings on pension plan investments 225,868 - Total $3,780,084 $- The amounts reported as deferred outflows and inflows of resources related to pensions is $3,780,084 and will be recognized in pension expense as follows: Year Ending April 30,Am ount 2023 $959,694 2024 1,033,371 2025 168,065 2026 1,480,572 2027 138,382 Total $3,780,084 73 104 City of Lake Forest Notes to Financial Statements April 30, 2022 Pension Segment Information Fiduciary Net Position Pension Trust Police Pension Firefighters' Pension Total Assets Cash $413,924 $548,543 $962,467 Money markets 242,727 -242,727 Investments: U.S. treasury obligations 7,961,878 -7,961,878 Municipal/corporate bonds 5,822,089 -5,822,089 Mutual funds 22,987,786 -22,987,786 Real estate investment fund 5,072,527 -5,072,527 Firefighters pension investment fund -46,304,968 46,304,968 Receivables Interest 74,197 -74,197 Prepaid items 7,630 4,338 11,968 Due from primary government 47,235 26,841 74,076 Total assets 42,629,993 46,884,690 89,514,683 Liabilities Accounts payable 18,119 8,675 26,794 Total liabilities 18,119 8,675 26,794 Net Position Restricted for pension benefits $42,611,874 $46,876,015 $89,487,889 74 105 City of Lake Forest Notes to Financial Statements April 30, 2022 Changes in Plan Net Position Pension Trust Police Pension Firefighters' Pension Total Additions Contributions: Employer $3,379,444 $2,398,803 $5,778,247 Employee 474,817 343,611 818,428 Total contributions 3,854,261 2,742,414 6,596,675 Investment income: Interest 706,565 472,431 1,178,996 Net appreciation in fair value of investments (1,500,952)(2,989,435)(4,490,387) Total investment income (794,387)(2,517,004)(3,311,391) Less investment expense (88,811)(56,685)(145,496) Net investment income (883,198)(2,573,689)(3,456,887) Miscellaneous 100 -100 Total additions 2,971,163 168,725 3,139,888 Deductions Pension benefits and refunds 3,499,389 3,093,703 6,593,092 Other administrative expenses 59,832 43,818 103,650 Total deductions 3,559,221 3,137,521 6,696,742 Change in net position (588,058)(2,968,796)(3,556,854) Net Position, Beginning 43,199,932 49,844,811 93,044,743 Net Position, Ending $42,611,874 $46,876,015 $89,487,889 Risk Management The City is exposed to various risks of loss related to torts; theft of, damage to or destruction of assets; errors and omissions; injuries to employees; and natural disasters. The City accounts for its risk of loss in the Liability Insurance Fund through payments to the Intergovernmental Risk Management Agency. The City has also purchased insurance from private insurance companies. For insured programs, there have been no significant reductions in insurance coverage. For all programs, settlement amounts have not exceeded insurance coverage for the current or three prior years. 75 106 City of Lake Forest Notes to Financial Statements April 30, 2022 Public Entity Risk Pool IRMA The City participates in the Intergovernmental Risk Management Agency (IRMA). IRMA is an organization of municipalities and special districts in Northeastern Illinois that have formed an association under the Illinois Intergovernmental Co-operations Statute to pool their risk management needs. The agency administers a mix of self-insurance and commercial insurance coverages; property/casualty and workers’ compensation claim administration/litigation m anagement services; unemployment claim administration; extensive risk management/loss control consulting and training programs; and a risk information system and financial reporting service for its members. The City’s payments to IRMA are displayed on the financial statements as expenditures/expenses in appropriate funds. Each member assumes the first $25,000 of each occurrence and IRMA has a mix of self-insurance and commercial insurance at various amounts above that level. Each member appoints one delegate, along with an alternate delegate, to represent the member on the Board of Directors. The City does not exercise any control over the activities of IRMA beyond its representation on the Board of Directors. Initial contributions are determined each year based on the individual member’s eligible revenue as defined in the bylaws of IRMA and experience modification factors based on past member loss experience. Members have a contractual obligation to fund any deficit of IRMA attributable to any membership year during which they were a member. Supplemental contributions may be required to fund these deficits. Beginning of Claims and End of Fiscal Year Changes in Claim Fiscal Year Liability Estimates Payments Liability 2020-2021 $202,739 $307,508 $292,523 $217,724 2021-2022 217,724 166,981 169,316 215,389 City of Lake Forest Medical and Dental Plan The City established the City of Lake Forest Medical and Dental Plan, a self-insurance plan providing health insurance for all employees of the City, effective January 1, 2000. Administration of the Plan is provided by Professional Benefit Administrators, Inc. (an outside agency). Liabilities are reported when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. An excess coverage insurance policy covers total claims in excess of $100,000 per participant in a plan year. Liabilities include all amounts for claims, including incremental costs that have been incurred but not reported (IBNR) and are reported in the Self Insurance Fund (internal service fund). The City has not had significant reductions in insurance coverage in any of the last three years. Changes in the balances of claims liabilities for the years ended April 30, 2022 and 2021 are as follows: Beginning of End of Fiscal Year Changes in Claim Fiscal Year Liability Estimates Payments Liability 2020-2021 $569,284 $4,737,417 $4,530,320 $776,381 2021-2022 776,381 6,452,051 6,389,054 839,378 76 107 City of Lake Forest Notes to Financial Statements April 30, 2022 Joint Ventures Solid Waste Agency of Lake County The City of Lake Forest and 41 other municipalities jointly operate the Solid W aste Agency of Lake County, which is called the Solid W aste Agency of Lake County (the Agency). The purpose of the Agency is to implement a regional approach to solid waste management which addresses the economic, political and environmental issues in Lake County. The Agency is governed by a Board of Directors consisting of one official elected by each member. Each director has one vote. The governing body has authority to adopt its own budget and control the financial affairs of the the Agency. The Executive Committee of the Agency consists of nine members of the Board of Directors elected by the Board. Each member is entitled to one vote on the committee. The Executive Committee may take any action not specifically reserved on the Board of Directors by the Act, the Agency agreement or the by-laws. To obtain the Agency's financial statements, contact the Solid W aste Agency of Lake County, Illinois at 1311 N. Estes Street, Gurnee Illinois 60031 The City does not have an equity interest in the Agency. Northern Suburban Special Recreation Association The City is a member of the Northern Suburban Special Recreation Association (NSSRA), which was organized by ten organizations in order to provide special recreation programs to the physically and mentally handicapped within their districts and to share the expenses of such programs on a cooperative basis. Each member's 1999 contribution was determined based upon the ratio of the members' assessed valuations. The NSSRA is governed by a Board of Directors which consists of one representative from each participating organization. Each Director has an equal vote. The representatives of NSSRA are appointed by the Board of Directors. The Board of Directors is the governing body of the NSSRA and is responsible for establishing all major policies and changes therein and for approving all budgets, capital outlay, programming and master plans. The City does not have an equity interest in NSSRA although there does exist a residual interest in NSSRA's assets upon dissolution of the joint venture. The City has an ongoing financial responsibility for its share of the NSSRA's liabilities. Each participant is liable for their share of any of the NSSRA contracts entered into while bound by the intergovernmental agreement until those contracts are paid off. To obtain NSSRA's financial statements, contact Northern Suburban Special Recreation Association at 3105 MacArthur Blvd., Northbrook, Illinois 60062. 77 108 City of Lake Forest Notes to Financial Statements April 30, 2022 Other Postemployment Benefits General Information about the OPEB Plan Plan Description The City's defined benefit OPEB plan, City Plan, and the Library's defined benefit OPEB plan, Library Plan, provide insurance coverage for eligible retirees and their dependents through the City's and Library's group health insurance plans, which covers both active employees and retired members participating in the plan at blended rates. The City and Library Plans, which are single-employer plans, are funded on a pay-as-you-go basis and no assets are accumulated in a trust that meets the criteria in paragraph 4 of Statement 75. Benefits Provided The City Plan provides healthcare and dental coverage for retirees and their dependents. Non- PSEBA employees before the age of 65 may remain on the City's insurance plan and pay the full cost of coverage. Dependent coverage may continue under COBRA should the Retiree coverage terminate. For PSEBA employees, the City will pay the full cost of coverage prior to the age of 65. Eligible dependent coverage may continue with the City paying full cost of coverage should Retiree coverage terminate due to death until the dependent reaches Medicare eligibility or in the case of an underage dependent, until the maximum age of 26 is reached. Once a retiree turns 65, they may elect a separate policy that is not administered by the City. The Library Plan provides healthcare and dental coverage for retirees and their dependents. Employees before the age of 65 may remain on the Library’s insurance plan and pay the full cost of coverage. Dependent coverage may continue under COBRA should the Retiree coverage terminate. Once a retiree turns 65, they may elect a separate policy that is not administered by the Library. Employees Covered by Benefit Terms At April 30, 2022, the following employees were covered by the benefit terms: City Library Inactive plan members or beneficiaries currently receiving benefit payments 46 5 Active plan members 196 24 Total 242 29 Total OPEB Liability The City's total OPEB liability of $2,131,239 was measured as of April 30, 2022 and was determined by an actuarial valuation as of that date.The Library's total OPEB liability of $129,493 was measured as of April 30, 2022 and was determined by an actuarial valuation as of that date. 78 109 City of Lake Forest Notes to Financial Statements April 30, 2022 Actuarial Assumptions and Other Inputs For both the City and Library, the total OPEB liability in the April 30, 2021 actuarial valuation was determined using the following actuarial assumptions and other inputs, applied to all periods included in the measurement, unless otherwise specified: Inflation 2.25% Salary increases 2.50% Healthcare cost trend rates 6.00% - 5.50% for Medical, 4.00% for dental Retirees' share of benefit-related costs 100% The discount rate was based on Bond Buyer 20-Bond G.O. Index. Mortality rates were based on the PubG-2010(B) Improved Generationally using MP-2020 Improvement Rates, weighted per IMRF Experience Study Report dated December 14, 2020, for IMRF members. For police and fire members, mortality rates were based on the PubS-2010(A) Study improved to 2017 using MP-2019 improvement rates. The actuarial assumptions used in the April 30, 2022 valuation were based on the results of an actuarial experience study dated December 14, 2020. Changes in the Total OPEB Liability City- Total OPEB Liability Library- Total OPEB Liability Balances at April 30, 2021 $2,252,203 $159,877 Changes for the year: Service cost 169,870 2,435 Interest 49,206 3,258 Changes in assumptions or other inputs (170,973)(3,354) Benefit payments (169,067)(32,723) Net changes (120,964)(30,384) Balances at April 30, 2022 $2,131,239 $129,493 Changes of assumptions and other inputs reflect a change in the discount rate from 2.27% in 2021 to 3.21% in 2022 for both the City and the Library. Sensitivity of the Total OPEB Liability to Changes in the Discount Rate The following presents the total OPEB liability of the City and the Library, as well as what the total OPEB liability would be for each if it were calculated using a discount rate that is 1-percentage- point lower (2.21%) or 1-percentage-point higher (4.21%) than the current discount rate: 1% Decrease Discount Rate 1% Increase Total OPEB liability, City $2,266,924 $2,131,239 $2,002,196 Total OPEB liability, Library $130,986 $129,493 $127,999 79 110 City of Lake Forest Notes to Financial Statements April 30, 2022 Sensitivity of the Total OPEB Liability to Changes in the Healthcare Cost Trend Rates The following presents the total OPEB liability of the City and the Library, as well as what the total OPEB liability would be for each if it were calculated using healthcare cost trend rates that are 1- percentage-point lower (5.0% decreasing to 4.5%) or 1-percentage-point higher (7.0% decreasing to 6.5%) than the current healthcare cost trend rates: 1% Decrease Healthcare Cost Trend Rates 1% Increase Total OPEB liability, City $1,888,051 $2,131,239 $2,418,374 Total OPEB liability, Library $125,616 $129,493 $133,591 OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB For the year ended April 30, 2022, the City recognized OPEB expense of $198,534. At April 30, 2022, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources: Deferred Outflows of Resources Deferred Inflows of Resources Differences between expected and actual experience $-$389,925 Changes of assumptions or other inputs 292,483 155,842 Total $292,483 $545,767 For the year ended April 30, 2022, the Library recognized OPEB expense of $2,336. At April 30, 2022, the Library reported deferred outflows of resources and deferred inflows of resources related to OPEB from the following sources: Deferred Outflows of Resources Deferred Inflows of Resources Differences between expected and actual experience $-$13,671 Changes of assumptions or other inputs 5,301 5,463 Total $5,301 $19,134 80 111 City of Lake Forest Notes to Financial Statements April 30, 2022 Amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: Year Ended April 30:City Library 2023 $(20,542)$(3,357) 2024 (20,542)(3,357) 2025 (20,542)(3,357) 2026 (20,542)(3,357) 2027 (20,542)(1,372) Thereafter (150,574)967 Total $(253,284)$(13,833) Subsequent Event Effective January 1, 2020, Illinois Public Act 101-0610 consolidates the assets of the state's more than 650 downstate and suburban public safety pension funds into two consolidated investment funds. The investments of the police pension plan were transferred to the consolidated funds in June 2022. Laurel and Western Tax Increment Financing (TIF) District The City approved the Laurel and W estern TIF in January 2015. The TIF district is comprised of 10.6 acres. The City acquired the single parcel not previously owned by the City and prepared the site for a mix of housing options. Demolition of the seven structures was completed in preparation for the development of the site. The City entered into a Property Purchase Agreement with Focus Acquisition Company LLC for the sale and redevelopment of all the developable land within the district. Following environmental remediation and site preparation required by the City, as well as the completion of contingency and inspection periods under the agreement, the sale of the property was closed in September 2016. The purchase price of the City property was $12 million, consisting of $5.625 million paid to the City at closing and a TIF Note of $6.375 million executed between the City and the developer. The TIF Note was subsequently assigned by the developer to the City to allow repayment of the note from future TIF increment. As of April 30, 2022, the City received $1,290,630 in TIF increment property tax revenue. Because the TIF Note does not meet the definition of an asset pursuant to GASB Concept Statement 4 as of the financial statement date, the Note receivable has not been reported on the City’s financial statements. Revenue will be recognized as payments on the TIF Note are made. The first payment of $500,000 on the TIF Note was made as of April 30, 2022. A redevelopm ent agreement between the City and developer was also executed in September 2016. As of April 30, 2022, the City has received the development fees of $2,368,712 (FY17), as well as a payment in lieu of affordable housing in the amount of $650,000 (FY18). As of April 30 2022, construction of the three apartment buildings is complete and the buildings are fully occupied with a normal rate of turnover as leases expire. The first of two condominiums is complete with all twenty-four (24) condominiums sold. Construction of the second condominium building has not yet started. Seven (7) single family homes are completed and have been sold. Permits for two additional homes have been issued and plans are under review for another home. Two (2) vacant single family lots remain. 81 112 City of Lake Forest Notes to Financial Statements April 30, 2022 Effect of New Accounting Standards on Current-Period Financial Statements The Governmental Accounting Standards Board (GASB) has approved the following: Statement No. 87, Leases Statement No. 91, Conduit Debt Obligations Statement No. 92, Omnibus 2020 Statement No. 93, Replacement of Interbank Offered Rates Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangements Statement No. 96, Subscription-Based Information Technology Arrangements Statement No. 97, Certain Component Unit Criteria and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans - an amendment of GASB Statements No. 14 and No. 84 and a supersession of GASB Statement No. 32 Statement No. 99, Omnibus 2022 Statement No. 100, Accounting Changes and Error Corrections an amendment of GASB Statement No. 62 Statement No. 101, Compensated Absences When they become effective, application of these standards may restate portions of these financial statements. 82 113 REQUIRED SUPPLEMENTAR Y INFORMAT ION 114 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - General Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Taxes Property $20,885,192 $20,885,192 $20,785,656 $(99,536) Other taxes 2,522,426 2,522,426 2,900,697 378,271 Intergovernmental 5,495,015 5,495,015 8,058,224 2,563,209 Licenses and permits 2,426,879 2,426,879 3,460,452 1,033,573 Fines, forfeitures and penalties 210,000 210,000 256,681 46,681 Charges for services 4,718,416 4,718,416 4,893,680 175,264 Grants and contributions 4,900 4,900 238,424 233,524 Investment income 150,050 150,050 122,020 (28,030) Miscellaneous revenues 1,258,500 1,258,500 1,341,542 83,042 Total revenues 37,671,378 37,671,378 42,057,376 4,385,998 Expenditures General government 11,943,349 12,060,268 10,913,887 1,146,381 Highways and streets 3,031,047 3,055,930 2,853,140 202,790 Sanitation 2,563,065 2,565,565 2,573,258 (7,693) Public safety 19,316,593 19,363,462 18,965,034 398,428 Capital outlay 150,000 150,000 62,779 87,221 Contingency 3,777,849 3,777,849 -3,777,849 Total expenditures 40,781,903 40,973,074 35,368,098 5,604,976 Excess (deficiency) of revenues over (under) expenditures (3,110,525)(3,301,696)6,689,278 9,990,974 Other Financing Sources (Uses) Transfers out (667,864)(583,260)(6,082,481)(5,499,221) Total other financing sources (uses)(667,864)(583,260)(6,082,481)(5,499,221) Net change in fund balance $(3,778,389)$(3,884,956)606,797 $4,491,753 Fund Balance, Beginning 28,356,928 Fund Balance, Ending $28,963,725 See notes to required supplementary information 83 115 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Parks and Recreation Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Property taxes $6,473,131 $6,473,131 $6,434,953 $(38,178) Intergovernmental 40,000 40,000 124,753 84,753 Charges for services 2,927,252 2,927,252 2,746,614 (180,638) Grants and contributions 257,190 257,190 249,707 (7,483) Investment income 15,000 15,000 15,739 739 Miscellaneous revenues 30,500 30,500 59,880 29,380 Total revenues 9,743,073 9,743,073 9,631,646 (111,427) Expenditures Current: Culture and recreation 9,266,798 9,326,598 8,979,517 347,081 Capital outlay 414,847 449,847 180,176 269,671 Contingency 982,645 982,645 -982,645 Total expenditures 10,664,290 10,759,090 9,159,693 1,599,397 Excess (deficiency) of revenues over (under) expenditures (921,217)(1,016,017)471,953 1,487,970 Other Financing Sources (Uses) Transfers in 20,000 20,000 23,500 3,500 Transfers out (50,000)(50,000)(50,000)- Total other financing sources (uses)(30,000)(30,000)(26,500)3,500 Net change in fund balance $(951,217)$(1,046,017)445,453 $1,491,470 Fund Balance, Beginning 1,435,768 Fund Balance, Ending $1,881,221 See notes to required supplementary information 84 116 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - General Cemetery Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Charges for services $774,500 $774,500 $1,354,260 $579,760 Grants and contributions 12,000 12,000 15,325 3,325 Investment income (loss)50,000 50,000 (1,182,676)(1,232,676) Miscellaneous revenues --50 50 Total revenues 836,500 836,500 186,959 (649,541) Expenditures Current: General government 761,599 761,599 734,653 26,946 Capital outlay 260,000 1,931,556 161,954 1,769,602 Contingency 269,316 269,316 -269,316 Total expenditures 1,290,915 2,962,471 896,607 2,065,864 Excess (deficiency) of revenues over (under) expenditures (454,415)(2,125,971)(709,648)1,416,323 Other Financing Sources (Uses) Refunding debt issued -1,600,000 -(1,600,000) Total other financing sources (uses)-1,600,000 -(1,600,000) Net change in fund balance $(454,415)$(525,971)(709,648)$(183,677) Fund Balance, Beginning 11,353,154 Fund Balance, Ending $10,643,506 See notes to required supplementary information 85 117 See notes to required supplementary information 86 City of Lake Forest Illinois Municipal Retirement Fund Schedule of Changes in the City's Net Pension Liability and Related Ratios Past Seven Fiscal Years 2018 City Library Total City Library Total City Library Total Total pension liability Service cost 1,549,831$ 208,143$ 1,757,974$ 1,315,386$ 160,837$ 1,476,223$ 1,230,871$ 146,913$ 1,377,784$ Interest on total pension liability 7,086,670 951,742 8,038,412 6,584,652 668,406 7,253,058 6,690,906 767,094 7,458,000 Differences between expected and actual experience of the total pension liability 796,382 106,954 903,336 (689,342) (84,288) (773,630) 79,717 9,515 89,232 Changes of assumptions 103,436 13,891 117,327 (209,390) (25,603) (234,993) (2,740,693) (327,120) (3,067,813) Transfer of liability (13,798,877) (1,853,193) (15,652,070) - - - - - - Benefit payments, including refunds of member contributions (4,968,065) (667,212) (5,635,277) (4,566,385) (558,348) (5,124,733) (4,708,228) (561,958) (5,270,186) Net change in total pension liability (9,230,623) (1,239,675) (10,470,298) 2,434,921 161,004 2,595,925 552,573 34,444 587,017 Total pension liability - beginning 96,324,203 12,936,367 109,260,570 87,093,580 11,696,692 98,790,272 89,528,501 11,857,696 101,386,197 Total pension liability - ending (a)87,093,580$ 11,696,692$ 98,790,272$ 89,528,501$ 11,857,696$ 101,386,197$ 90,081,074$ 11,892,140$ 101,973,214$ Plan fiduciary net position Employer contributions 1,757,095$ 235,978$ 1,993,073$ 1,494,964$ 182,795$ 1,677,759$ 1,485,109$ 177,258$ 1,662,367$ Employee contributions 664,444 89,235 753,679 558,977 68,348 627,325 532,665 63,577 596,242 Net investment income 442,808 59,469 502,277 5,250,256 641,968 5,892,224 14,307,003 1,707,636 16,014,639 Benefit payments, including refunds of member contributions (4,968,065) (667,212) (5,635,277) (4,566,385) (558,348) (5,124,733) (4,708,228) (561,958) (5,270,186) Other (net transfer)(12,005,830) (1,612,386) (13,618,216) 262,841 32,138 294,979 (1,329,766) (158,716) (1,488,482) Net change in plan fiduciary net position (14,109,548) (1,894,916) (16,004,464) 3,000,653 366,901 3,367,554 10,286,783 1,227,797 11,514,580 Plan fiduciary net position - beginning 89,834,842 12,064,844 101,899,686 75,725,294 10,169,928 85,895,222 78,725,947 10,536,829 89,262,776 Plan fiduciary net position - ending (b)75,725,294$ 10,169,928$ 85,895,222$ 78,725,947$ 10,536,829$ 89,262,776$ 89,012,730$ 11,764,626$ 100,777,356$ Employer's net pension liability - ending (a) - (b)11,368,286$ 1,526,764$ 12,895,050$ 10,802,554$ 1,320,867$ 12,123,421$ 1,068,344$ 127,514$ 1,195,858$ Plan fiduciary net position as a percentage of the total pension liability 86.95%88.04%98.83% Covered payroll 13,391,112$ 13,135,941$ 13,224,884$ Employer's net pension liability as a percentage of covered payroll 96.30%92.29%9.04% Notes to Schedule: 2016 The City implemented GASB Statement No. 68 in fiscal year 2016. Information prior to fiscal year 2016 is not available. 2017 118 See notes to required supplementary information 87 City of Lake Forest Illinois Municipal Retirement Fund Schedule of Changes in the City's Net Pension Liability and Related Ratios Past Seven Fiscal Years 2021 City Library Total City Library Total City Library Total Total pension liability Service cost 1,162,585$ 120,326$ 1,282,911$ 1,244,941$ 134,702$ 1,379,643$ 1,268,902 131,502 1,400,404$ Interest on total pension liability 6,788,684 702,616 7,491,300 6,990,156 756,331 7,746,487 7,326,612 759,293 8,085,905 Differences between expected and actual experience of the total pension liability 819,901 84,858 904,759 1,465,195 158,533 1,623,728 (786,697) (81,529) (868,226) Changes of assumptions 2,657,676 258,123 2,915,799 (58,022) 58,022 - (783,863) (103,244) (887,107) Transfer of liability - - - - - - - - - Benefit payments, including refunds of member contributions (4,949,110) (512,224) (5,461,334) (5,321,027) (575,732) (5,896,759) (5,672,563) (587,876) (6,260,439) Net change in total pension liability 6,479,736 653,699 7,133,435 4,321,243 531,856 4,853,099 1,352,391 118,146 1,470,537 Total pension liability - beginning 90,081,074 11,892,140 101,973,214 96,560,810 12,545,839 109,106,649 100,882,053 13,077,695 113,959,748 Total pension liability - ending (a)96,560,810$ 12,545,839$ 109,106,649$ 100,882,053$ 13,077,695$ 113,959,748$ 102,234,444$ 13,195,841$ 115,430,285$ Plan fiduciary net position Employer contributions 1,535,144$ 158,885$ 1,694,029$ 1,224,123$ 132,449$ 1,356,572$ 1,525,544 158,100 1,683,644$ Employee contributions 557,075 57,656 614,731 575,110 62,227 637,337 610,488 63,268 673,756 Net investment income (5,144,778) (532,475) (5,677,253) 16,063,705 1,738,084 17,801,789 14,246,702 1,476,456 15,723,158 Benefit payments, including refunds of member contributions (4,949,110) (512,224) (5,461,334) (5,321,027) (575,732) (5,896,759) (5,672,563) (587,876) (6,260,439) Other (net transfer)1,872,470 193,797 2,066,267 635,098 68,717 703,815 (182,338) (18,898) (201,236) Net change in plan fiduciary net position (6,129,199) (634,361) (6,763,560) 13,177,009 1,425,745 14,602,754 10,527,833 1,091,050 11,618,883 Plan fiduciary net position - beginning 89,012,730 11,764,626 100,777,356 82,883,531 11,130,265 94,013,796 96,060,540 12,556,010 108,616,550 Plan fiduciary net position - ending (b)82,883,531$ 11,130,265$ 94,013,796$ 96,060,540$ 12,556,010$ 108,616,550$ 106,588,373$ 13,647,060$ 120,235,433$ Employer's net pension liability - ending (a) - (b)13,677,279$ 1,415,574$ 15,092,853$ 4,821,513$ 521,685$ 5,343,198$ (4,353,929)$ (451,219)$ (4,805,148)$ Plan fiduciary net position as a percentage of the total pension liability 86.17%95.31%104.16% Covered payroll 13,522,211$ 14,163,049$ 14,122,896 Employer's net pension liability as a percentage of covered payroll 111.62%37.73%-34.02% Notes to Schedule: The City implemented GASB Statement No. 68 in fiscal year 2016. Information prior to fiscal year 2016 is not available. 20202019 119 See notes to required supplementary information 88 City of Lake Forest Illinois Municipal Retirement Fund Schedule of Changes in the City's Net Pension Liability and Related Ratios Past Seven Fiscal Years City Library Total Total pension liability Service cost 1,192,260$ 119,044$ 1,311,304$ Interest on total pension liability 7,443,020 743,169 8,186,189 Differences between expected and actual experience of the total pension liability 2,050,858 204,773 2,255,631 Changes of assumptions (14,992) 14,992 - Transfer of liability - - - Benefit payments, including refunds of member contributions (5,769,875) (576,108) (6,345,983) Net change in total pension liability 4,901,272 505,869 5,407,141 Total pension liability - beginning 102,234,444 13,195,841 115,430,285 Total pension liability - ending (a)107,135,715$ 13,701,711$ 120,837,426$ Plan fiduciary net position Employer contributions 1,553,376$ 155,101$ 1,708,477$ Employee contributions 645,521 64,454 709,975 Net investment income 18,659,240 1,863,080 20,522,320 Benefit payments, including refunds of member contributions (5,769,875) (576,108) (6,345,983) Other (net transfer)260,999 26,060 287,059 Net change in plan fiduciary net position 15,349,261 1,532,587 16,881,848 Plan fiduciary net position - beginning 106,588,373 13,647,060 120,235,433 Plan fiduciary net position - ending (b)121,937,634$ 15,179,647$ 137,117,281$ Employer's net pension liability - ending (a) - (b)(14,801,919)$ (1,477,936)$ (16,279,855)$ Plan fiduciary net position as a percentage of the total pension liability 113.47% Covered payroll 14,653,276 Employer's net pension liability as a percentage of covered payroll -111.10% Notes to Schedule: The City implemented GASB Statement No. 68 in fiscal year 2016. Information prior to fiscal year 2016 is not available. 2022 120 See notes to required supplementary information 89 City of Lake Forest Illinois Municipal Retirement Fund Schedule of Employer Contributions Past Seven.Fiscal Years City Library Total City Library Total City Library Total Actuarially determined contribution 1,553,462$ 155,110 1,708,572$ 1,525,367$ 158,082 1,683,449$ 1,217,957$ 131,782$ 1,349,739$ Contributions in relation to the actuarially determined contribution (1,553,376) (155,101) (1,708,477) (1,525,544) (158,100) (1,683,644) (1,224,123) (132,449) (1,356,572) Contribution deficiency (excess)86$ 9$ 95$ (177)$ (18)$ (195)$ (6,166)$ (667)$ (6,833)$ Covered payroll 14,880,617 15,519,529 14,612,252$ Contributions as a percentage of covered payroll 11.48%10.85%9.28% City Library Total City Library Total City Library Total Actuarially determined contribution 1,514,588$ 156,757$ 1,671,345$ 1,447,303$ 172,745$ 1,620,048$ 1,454,901$ 177,896$ 1,632,797$ Contributions in relation to the actuarially determined contribution (1,535,144) (158,885) (1,694,029) (1,485,109) (177,258) (1,662,367) (1,494,964) (182,795) (1,677,759) Contribution deficiency (excess)(20,556)$ (2,128)$ (22,684)$ (37,806)$ (4,513)$ (42,319)$ (40,063)$ (4,899)$ (44,962)$ Covered payroll 14,446,880$ 13,247,776$ 13,135,941$ Contributions as a percentage of covered payroll 11.73%12.55%12.77% Notes to Schedule: City Library Total 1,741,632$ 233,902$ 1,975,534$ Valuation date:(1,757,095) (235,978) (1,993,073) (15,463)$ (2,076)$ (17,539)$ 13,391,112$ Methods and assumptions used to determine contribution rates: Actuarial cost method 14.88% Amortization method Remaining amortization period Asset valuation method Inflation Salary increases Investment rate of return 7.25% Retirement Age Mortality Other information: There were no benefit changes during the year. 2022 22 years Level percentage of payroll, closed 2017 Actuarially determined contribution rates are calculated as of December 31 each year, which are 6 months prior to the beginning of the fiscal year in which contributions are reported. The City implemented GASB Statement No. 68 in fiscal year 2016. Information prior to fiscal year 2016 is not available. 2019 2018 20202021 2016 RP-2014 Employee Mortality Table, adjusted to match current IMRF experience 5-Year Smoothed Fair Value, 20% corridor 2.50% 3.35% to 14.25%, including inflation Aggregate Entry age normal Experience-based table of rates that are specific to the type of eligibility condition 121 See notes to required supplementary information 90 City of Lake Forest Police Pension Fund Schedule of Changes in the City's Net Pension Liability and Related Ratios Last Eight Fiscal Years 2015 2016 2017 2018 2019 2020 2021 2022 Total pension liability Service cost 845,979$ 883,178$ 931,083$ 895,320$ 900,450$ 908,951$ 1,053,151$ 948,636$ Interest on total pension liability 3,219,893 3,657,765 3,660,514 3,908,626 4,051,210 4,435,870 4,511,442 4,721,027 Change on benefit terms - - - - - 231,490 - - Differences between expected and actual experience of the total pension liability 2,713 (2,129,040) 306,030 (39,964) 2,043,281 (1,297,619) 1,028,579 (360,851) Changes of assumptions 3,568,719 - 1,248,764 - 3,709,450 2,226,349 287,776 Benefit payments, including refunds of member contributions (2,193,705) (2,320,588) (2,520,473) (2,611,864) (2,852,542) (2,888,907) (3,029,156) (3,499,388) Other (16,057) - - - - - - - Net change in total pension liability 5,427,542 91,315 3,625,918 2,152,118 7,851,849 3,616,134 3,564,016 2,097,200 Total pension liability - beginning 47,103,353 52,530,895 52,622,210 56,248,128 58,400,246 66,252,095 69,868,229 73,432,245 Total pension liability - ending (a)52,530,895$ 52,622,210$ 56,248,128$ 58,400,246$ 66,252,095$ 69,868,229$ 73,432,245$ 75,529,445$ Plan fiduciary net position Employer contributions 1,706,203$ 1,806,270$ 1,895,500$ 2,094,124$ 2,504,581$ 2,589,534$ 3,581,389$ 3,379,444$ Employee contributions 360,156 373,216 371,695 379,500 392,258 404,985 427,305 474,816 Net investment income 1,669,508 (475,655) 2,635,379 2,064,885 1,716,441 158,635 8,702,747 (888,628) Benefit payments, including refunds of member contributions (2,193,705) (2,320,588) (2,520,473) (2,611,864) (2,852,542) (2,888,907) (3,029,156) (3,499,388) Administrative expenses (4,150) (4,835) (27,816) (34,158) (60,847) (52,357) (45,069) (54,302) Net change in plan fiduciary net position 1,538,012 (621,592) 2,354,285 1,892,487 1,699,891 211,890 9,637,216 (588,058) Plan fiduciary net position - beginning 26,487,743 28,025,755 27,404,163 29,758,448 31,650,935 33,350,826 33,562,716 43,199,932 Plan fiduciary net position - ending (b)28,025,755$ 27,404,163$ 29,758,448$ 31,650,935$ 33,350,826$ 33,562,716$ 43,199,932$ 42,611,874$ City's net pension liability - ending (a) - (b)24,505,140$ 25,218,047$ 26,489,680$ 26,749,311$ 32,901,269$ 36,305,513$ 30,232,313$ 32,917,571$ Plan fiduciary net position as a percentage of the total pension liability 53.35%52.08%52.91%54.20%50.34%48.04%58.83%56.42% Covered payroll 3,590,934$ 3,759,611$ 3,750,706$ 3,800,841$ 3,940,419$ 4,059,797$ 4,077,656$ 4,527,537$ City's net pension liability as a percentage of covered payroll 682.42%670.76%706.26%703.77%834.97%894.27%741.41%727.05% Notes to Schedule: The Pension implemented GASB Statement No. 67 in fiscal year 2015. Information prior to fiscal year 2015 is not available. Changes of assumptions. There were no assumption or method changes since the prior valuation. 122 See notes to required supplementary information 91 City of Lake Forest Police Pension Fund Schedule of Employer Contributions Last Ten Fiscal Years 2013 2014 2015 2016 Actuarially determined contribution 1,375,906$ 1,384,307$ 1,508,450$ 1,810,315$ Contributions in relation to the actuarially determined contribution 1,502,075 1,563,964 1,706,203 1,806,270 Contribution deficiency (excess)(126,169)$ (179,657)$ (197,753)$ 4,045$ Covered payroll 3,170,518$ 3,518,797$ 3,590,934$ 3,759,611$ Contributions as a percentage of covered payroll 47.38%44.45%47.51%48.04% Notes to Schedule: Methods and assumptions used to determine contribution rates: Actuarial cost method Amortization method Remaining amortization period Asset valuation method Inflation Salary increases Investment rate of return Retirement age Mortality Valuation date: Actuarially determined contributions are calculated as of May 1, two years prior to the year in which contributions are reported. The Pension implemented GASB Statement No. 67 in fiscal year 2015. Information prior to fiscal year 2015 is derived from actuarial valuations developed in conformity with GASB Statement No. 25 and 27. Entry-age normal Level percentage of payroll, closed 26 years (as of 5/1/2015 valuation); 23 years (as of 5/1/2016 valuation); 22 years (as of 5/1/2019 valuation); 21 years (as of 5/1/2020 valuation) PubS-2010 Employee mortality, projected 5 years past the valuation date with Scale MP-2019. Investment gains and losses are smoothed over a 5-year period Varies by service 50-70 2.50% 6.50%, net of pension plan investment expense 123 See notes to required supplementary information 92 2017 2018 2019 2020 2021 2022 1,737,445$ 1,832,059$ 2,505,888$ 2,594,845$ 3,090,726$ 3,388,076$ 1,895,500 2,094,124 2,504,581 2,589,534 3,581,389 3,379,444 (158,055)$ (262,065)$ 1,307$ 5,311$ (490,663)$ 8,632$ 3,750,706$ 3,800,841$ 3,940,419$ 4,059,797$ 4,077,656$ 4,527,537$ 50.54%55.10%63.56%63.78%87.83%74.64% 124 See notes to required supplementary information 93 City of Lake Forest Police Pension Fund Schedule of Investment Returns Last Eight Fiscal Years 2015 2016 2017 2018 2019 2020 2021 2022 Annual money-weighted rate of return, net of investment expense 6.79%-1.44%9.67%7.03%5.48%0.59%25.29%-1.89% Notes to Schedule: The Pension implemented GASB Statement No. 67 in fiscal year 2015. Information prior to fiscal year 2015 is not available. 125 See notes to required supplementary information 94 City of Lake Forest Firefighters' Pension Fund Schedule of Changes in the City's Net Pension Liability and Related Ratios Last Eight Fiscal Years 2015 2016 2017 2018 2019 2020 2021 2022 Total pension liability Service cost 912,154$ 926,420$ 860,148$ 854,245$ 891,741$ 876,151$ 1,017,451$ 1,006,247$ Interest on total pension liability 2,754,242 3,072,945 3,190,325 3,425,477 3,564,977 3,779,365 3,912,242 4,107,962 Changes in benefit terms - - - - - 172,556 - - Differences between expected and actual experience actual experience of the total pension liability (213,530) (186,474) 227,730 176,286 166,664 134,069 1,089,198 150,101 Changes of assumptions 2,024,054 - 1,401,097 - 3,101,793 1,900,513 - 680,212 Benefit payments, including refunds of member contributions (1,769,849) (1,931,047) (2,208,471) (2,419,682) (2,581,621) (2,712,864) (2,899,533) (3,093,703) Net change in total pension liability 3,707,071 1,881,844 3,470,829 2,036,326 5,143,554 4,149,790 3,119,358 2,850,819 Total pension liability - beginning 40,231,243 43,938,314 45,820,158 49,290,987 51,327,313 56,470,867 60,620,657 63,740,015 Total pension liability - ending (a)43,938,314$ 45,820,158$ 49,290,987$ 51,327,313$ 56,470,867$ 60,620,657$ 63,740,015$ 66,590,834$ Plan fiduciary net position Employer contributions 1,168,287$ 1,216,585$ 1,211,587$ 1,308,348$ 1,719,445$ 1,822,064$ 2,567,216$ 2,398,803$ Employee contributions 296,676 297,946 290,383 296,202 311,675 330,725 349,655 343,611 Net investment income 1,871,817 60,335 3,053,497 2,897,100 3,032,134 988,063 10,796,842 (2,576,122) Miscellaneous revenue - 100 - - - - - - Benefit payments, including refunds of member contributions (1,769,849) (1,931,047) (2,208,471) (2,419,682) (2,581,621) (2,712,864) (2,899,533) (3,093,703) Administrative expenses (4,150) (4,835) (34,006) (35,547) (52,598) (44,220) (38,657) (41,385) Net change in plan fiduciary net position 1,562,781 (360,916) 2,312,990 2,046,421 2,429,035 383,768 10,775,523 (2,968,796) Plan fiduciary net position - beginning 30,695,209 32,257,990 31,897,074 34,210,064 36,256,485 38,685,520 39,069,288 49,844,811 Plan fiduciary net position - ending (b)32,257,990$ 31,897,074$ 34,210,064$ 36,256,485$ 38,685,520$ 39,069,288$ 49,844,811$ 46,876,015$ City's net pension liability - ending (a) - (b)11,680,324$ 13,923,084$ 15,080,923$ 15,070,828$ 17,785,347$ 21,551,369$ 13,895,204$ 19,714,819$ Plan fiduciary net position as a percentage of the total pension liability 73.42%69.61%69.40%70.64%68.51%64.45%78.20%70.39% Covered payroll 3,111,216$ 2,924,893$ 3,071,211$ 3,237,410$ 3,338,448$ 3,440,901$ 3,527,518$ 3,523,737$ City's net pension liability as a percentage of covered payroll 375.43%476.02%491.04%465.52%532.74%626.33%393.91%559.49% Notes to Schedule: The Pension implemented GASB Statement No. 67 in fiscal year 2015. Information prior to fiscal year 2015 is not available. There were no assumption or method changes since the prior valuation. Changes of assumptions. 126 See notes to required supplementary information 95 City of Lake Forest Firefighters' Pension Fund Schedule of Employer Contributions Last Ten Fiscal Years 2013 2014 2015 2016 Actuarially determined contribution 894,551$ 894,384$ 950,325$ 1,217,702$ Contributions in relation to the actuarially determined contribution 1,026,345 1,090,695 1,168,287 1,216,585 Contribution deficiency (excess)(131,794)$ (196,311)$ (217,962)$ 1,117$ Covered payroll 3,049,732$ 3,004,889$ 3,111,216$ 2,924,893$ Contributions as a percentage of covered payroll 33.65%36.30%37.55%41.59% Notes to Schedule: Methods and assumptions used to determine contribution rates: Actuarial cost method Amortization method Remaining amortization period Asset valuation method Salary increases Investment rate of return Retirement age Mortality PubS-2010 Employee mortality, projected 5 years past the valuation date with Scale MP-2019. Entry-age normal Level percentage of payroll, closed 5-year average fair value 19 years (as of 05/01/2015 valuation), 23 years (as of the 05/01/2016 valuation), and 22 years (as of the 05/01/2019 valuation); 21 years (as of 5/1/2020 valuation) The Pension implemented GASB Statement No. 67 in fiscal year 2015. Information prior to fiscal year 2015 is derived from actuarial valuations developed in conformity with GASB Statement No. 25 and 27. Valuation date: Actuarially determined contributions are calculated as of May 1, two years prior to the year in which contributions are reported. 5.90% 6.50%, net of pension plan investment expense 50-70 127 See notes to required supplementary information 96 2017 2018 2019 2020 2021 2022 1,137,826$ 1,298,188$ 1,721,953$ 1,826,568$ 2,075,171$ 2,406,318$ 1,211,587 1,308,348 1,719,445 1,822,064 2,567,216 2,398,803 (73,761)$ (10,160)$ 2,508$ 4,504$ (492,045)$ 7,515$ 3,071,211$ 3,237,410$ 3,388,448$ 3,440,901$ 3,527,518$ 3,523,737$ 39.45%40.41%50.74%52.95%72.78%68.08% 128 See notes to required supplementary information 97 City of Lake Forest Firefighters' Pension Fund Schedule of Investment Returns Last Eight Fiscal Years 2015 2016 2017 2018 2019 2020 2021 2022 Annual money-weighted rate of return, net of investment expense 6.48%0.26%9.66%8.65%8.56%2.63%28.13%-5.19% Notes to Schedule: The Pension implemented GASB Statement No. 67 in fiscal year 2015. Information prior to fiscal year 2015 is not available. 129 See notes to required supplementary information 98 City of Lake Forest Other Postemployment Benefits Plan Schedule of Changes in the City's Total OPEB Liability and Related Ratios Last Four Fiscal Years City Library City Library City Library City Library Total OPEB liability Service cost 46,323$ 1,620$ 49,721$ 1,718$ 64,125$ 2,014$ 169,870$ 2,435$ Interest 93,093 8,019 89,145 7,379 68,569 4,829 49,206 3,258 Differences between expected and actual experience - - - - (473,423) (19,803) - - Changes of assumptions 32,177 1,221 365,319 6,686 6,339 (3,818) (170,973) (3,354) Benefit payments, including refunds of member contributions (157,993) (16,545) (171,388) (19,768) (183,715) (23,925) (169,067) (32,723) Net change in total OPEB liability 13,600 (5,685) 332,797 (3,985) (518,105) (40,703) (120,964) (30,384) Total OPEB liability - beginning 2,423,911 210,250 2,437,511 204,565 2,770,308 200,580 2,252,203 159,877 Total OPEB liability - ending (a)2,437,511$ 204,565$ 2,770,308$ 200,580$ 2,252,203$ 159,877$ 2,131,239$ 129,493$ Plan fiduciary net position as a percentage of the total OPEB liability 0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00% Covered-employee payroll 20,233,763$ 1,467,746$ 20,794,094$ 1,382,150$ 22,059,672$ 1,458,298$ 21,774,034$ 1,380,692$ City's total OPEB liability as a percentage of covered-employee payroll 12.05%13.94%13.32%14.51%10.21%10.96%9.79%9.38% Notes to Schedule: 2022 There are no assets accumulated in a trust that meets the criteria of GASB codification P52.101 to pay related benefits for the OPEB plan. The District implemented GASB Statement No. 75 in fiscal year 2019. Information prior to fiscal year 2019 is not available. 2019 2020 2021 130 City of Lake Forest Notes to Required Supplementary Information Year Ended April 30, 2022 Budgetary Information Budgets for the General and major special revenue funds are adopted on a basis of accounting consistent with accounting principles generally accepted in the United States of America (GAAP). 99 131 SUPPLEMENTARY INFORMAT ION 132 Nonmajor Special Revenue Funds Police Restricted Fund –This fund accounts for revenues received from drug arrests (convicted property). Used solely for drug prevention programs administered by the Lake Forest Police Department. Foreign Fire Insurance Tax Fund –This fund accounts for revenues received from the 2% tax on fire insurance companies. Administered by members of the Fire Department to benefit the Fire Department. Emergency Telephone Fund –This fund accounts for the operations and maintenance of the emergency 911 telephone sys tem. Financing is provided by a specific monthly surcharge on customer telephone bills. Parks and Public Land Fund –This fund accounts for the revenues received from grants, contributions and the collection of open space fees. Such revenues are to be used to purchase or improve land. Motor Fuel Tax Fund –This fund accounts for the revenues received from the State of Illinois for the local share of the motor fuel tax collections. Senior Resources Commission Fund –This fund accounts for gifts, activity fees, and investments used to finance senior citizens’ programs and activities. Housing Trust Fund –This fund accounts for half of the revenues received from the demolition tax. Revenues will be used for affordable housing projects in Lake Forest. Nonmajor Debt Service Fund Debt Service Fund –This fund accounts for the principal and interest currently due on general obligation bonds. Nonmajor Capital Projects Fund Laurel/Western Redevelopment TIF Fund –This fund accounts for tax increment revenues to be used for the improvements in the TIF district. Major Capital Projects Fund Capital Improvements Fund –This fund accounts for revenues to be used to fund city building and infrastructure projects. 133 City of Lake Forest Combining Balance Sheet Nonmajor Governmental Funds April 30, 2022 Special Revenue Funds Police Restricted Foreign Fire Insurance Tax Emergency Telephone Parks and Public Land Motor Fuel Tax Assets Cash and cash equivalents $117,580 $215,927 $293,186 $2,408,933 $2,362,891 Receivables: Property taxes ----- Other 80 -1,023,410 -- Due from other governments ---139,997 65,015 Total assets $117,660 $215,927 $1,316,596 $2,548,930 $2,427,906 Liabilities, Deferred Inflows of Resources and Fund Balances Liabilities Accounts payable $-$-$17,305 $536 $32,160 Accrued liabilities ----- Deposits ----- Unearned revenues ---139,997 - Total liabilities --17,305 140,533 32,160 Deferred Inflows of Resources Property taxes levied for a future period ----- Total deferred inflows of resources ----- Fund Balances Restricted for capital projects ----- Restricted for culture and recreation ---2,408,397 - Restricted for highways and streets ----2,395,746 Restricted for public safety 117,660 215,927 1,299,291 -- Restricted for affordable housing ----- Restricted for debt service purposes ----- Total fund balances 117,660 215,927 1,299,291 2,408,397 2,395,746 Total liabilities, deferred inflows of resources and fund balances $117,660 $215,927 $1,316,596 $2,548,930 $2,427,906 100 134 Special Revenue Funds Debt Service Funds Capital Projects Fund Senior Resources Commission Housing Trust Debt Service Laurel/Western Redevelopment TIF Total Nonmajor Governmental Funds $112,475 $2,201,485 $1,594,462 $123,664 $9,430,603 --2,062,352 -2,062,352 82,363 ---1,105,853 ----205,012 $194,838 $2,201,485 $3,656,814 $123,664 $12,803,820 $100,704 $-$-$117,665 $268,370 5,145 ---5,145 -18,000 --18,000 ----139,997 105,849 18,000 -117,665 431,512 --2,062,354 -2,062,354 --2,062,354 -2,062,354 ---5,999 5,999 88,989 ---2,497,386 ----2,395,746 ----1,632,878 -2,183,485 --2,183,485 --1,594,460 -1,594,460 88,989 2,183,485 1,594,460 5,999 10,309,954 $194,838 $2,201,485 $3,656,814 $123,664 $12,803,820 101 135 City of Lake Forest Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds Year Ended April 30, 2022 Special Revenue Funds Police Restricted Foreign Fire Insurance Tax Emergency Telephone Parks and Public Land Motor Fuel Tax Revenues Taxes: Property $-$-$-$-$- Other ----- Intergovernmental 679 ---1,198,009 Charges for services 29,073 151,490 429,954 23,635 - Grants and contributions ----1,344 Investment income 622 63 2,378 6,707 8,281 Miscellaneous revenues --375,501 -- Total revenues 30,374 151,553 807,833 30,342 1,207,634 Expenditures Current: General government ----- Culture and recreation ---110,032 - Public safety -286,290 213,286 -- Capital outlay 30,981 -80,053 -156,160 Debt service: Principal retirement ----- Interest and fiscal charges ----- Total expenditures 30,981 286,290 293,339 110,032 156,160 Excess (deficiency) of revenues over expenditures (607)(134,737)514,494 (79,690)1,051,474 Other Financing Sources (Uses) Transfers in ---1,000,000 - Transfers out ----- Refunding debt issued ----- Premium on debt issued ----- Payment to refunded bonds escrow agent ----- Total other financing sources (uses)---1,000,000 - Net change in fund balances (607)(134,737)514,494 920,310 1,051,474 Fund Balances (Deficit), Beginning 118,267 350,664 784,797 1,488,087 1,344,272 Fund Balances, Ending $117,660 $215,927 $1,299,291 $2,408,397 $2,395,746 102 136 Special Revenue Funds Debt Service Funds Capital Projects Fund Senior Resources Commission Housing Trust Debt Service Laurel/Western Redevelopment TIF Total Nonmajor Governmental Funds $-$-$2,095,213 $1,290,630 $3,385,843 -36,000 695,377 -731,377 ----1,198,688 88,541 ---722,693 236,093 ---237,437 741 7,831 10,374 1,102 38,099 ----375,501 325,375 43,831 2,800,964 1,291,732 6,689,638 -7,413 1,312 120,205 128,930 646,223 ---756,255 ----499,576 ----267,194 --2,009,665 -2,009,665 --957,831 -957,831 646,223 7,413 2,968,808 120,205 4,619,451 (320,848)36,418 (167,844)1,171,527 2,070,187 256,481 500,000 361,313 -2,117,794 --(500,000)(861,313)(1,361,313) --7,590,000 -7,590,000 --511,784 -511,784 --(8,101,528)-(8,101,528) 256,481 500,000 (138,431)(861,313)756,737 (64,367)536,418 (306,275)310,214 2,826,924 153,356 1,647,067 1,900,735 (304,215)7,483,030 $88,989 $2,183,485 $1,594,460 $5,999 $10,309,954 103 137 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Police Restricted Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Intergovernmental $4,000 $4,000 $679 $(3,321) Charges for services 34,000 34,000 29,073 (4,927) Investment income 500 500 622 122 Total revenues 38,500 38,500 30,374 (8,126) Expenditures Current: Public safety 91,000 91,000 -91,000 Capital outlay --30,981 (30,981) Contingency 9,100 9,100 -9,100 Total expenditures 100,100 100,100 30,981 69,119 Net change in fund balance $(61,600)$(61,600)(607)$60,993 Fund Balance, Beginning 118,267 Fund Balance, Ending $117,660 104 138 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Foreign Fire Insurance Tax Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Charges for services $125,000 $125,000 $151,490 $26,490 Investment income 500 500 63 (437) Total revenues 125,500 125,500 151,553 26,053 Expenditures Public safety 300,000 300,000 286,290 13,710 Total expenditures 300,000 300,000 286,290 13,710 Net change in fund balance $(174,500)$(174,500)(134,737)$39,763 Fund Balance, Beginning 350,664 Fund Balance, Ending $215,927 105 139 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Emergency Telephone Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Charges for services $440,000 $440,000 $429,954 $(10,046) Investment income 3,000 3,000 2,378 (622) Miscellaneous revenues --375,501 375,501 Total revenues 443,000 443,000 807,833 364,833 Expenditures Public safety 218,000 218,000 213,286 4,714 Capital outlay 86,357 86,357 80,053 6,304 Contingency 30,436 30,436 -30,436 Total expenditures 334,793 334,793 293,339 41,454 Net change in fund balance $108,207 $108,207 514,494 $406,287 Fund Balance, Beginning 784,797 Fund Balance, Ending $1,299,291 106 140 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Parks and Public Land Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Charges for services $31,336 $31,336 $23,635 $(7,701) Investment income 2,500 2,500 6,707 4,207 Total revenues 33,836 33,836 30,342 (3,494) Expenditures Culture and recreation -400,000 110,032 289,968 Contingency -40,000 -40,000 Total expenditures -440,000 110,032 329,968 Excess (deficiency) of revenues over (under) expenditures 33,836 (406,164)(79,690)326,474 Other Financing Sources (Uses) Transfers in --1,000,000 1,000,000 Total other financing sources (uses)--1,000,000 1,000,000 Net change in fund balance $33,836 $(406,164)920,310 $1,326,474 Fund Balance, Beginning 1,488,087 Fund Balance, Ending $2,408,397 107 141 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Motor Fuel Tax Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Intergovernmental $758,271 $758,271 $1,198,009 $439,738 Grants and contributions --1,344 1,344 Investment income 3,000 3,000 8,281 5,281 Total revenues 761,271 761,271 1,207,634 446,363 Expenditures Capital outlay 267,697 417,697 156,160 261,537 Contingency 26,770 26,770 -26,770 Total expenditures 294,467 444,467 156,160 288,307 Net change in fund balance $466,804 $316,804 1,051,474 $734,670 Fund Balance, Beginning 1,344,272 Fund Balance, Ending $2,395,746 108 142 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Senior Resources Commission Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Charges for services $143,500 $143,500 $88,541 $(54,959) Grants and contributions 174,325 232,475 236,093 3,618 Investment income 3,500 3,500 741 (2,759) Total revenues 321,325 379,475 325,375 (54,100) Expenditures Culture and recreation 603,740 717,000 646,223 70,777 Contingency 71,700 71,700 -71,700 Total expenditures 675,440 788,700 646,223 142,477 Excess (deficiency) of revenues over (under) expenditures (354,115)(409,225)(320,848)88,377 Other Financing Sources Transfers in 282,760 282,760 256,481 (26,279) Total other financing sources 282,760 282,760 256,481 (26,279) Net change in fund balance $(71,355)$(126,465)(64,367)$62,098 Fund Balance, Beginning 153,356 Fund Balance, Ending $88,989 109 143 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Housing Trust Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Other taxes $30,000 $30,000 $36,000 $6,000 Investment income 15,000 15,000 7,831 (7,169) Total revenues 45,000 45,000 43,831 (1,169) Expenditures General government 650,000 674,965 7,413 667,552 Contingency 67,497 67,497 -67,497 Total expenditures 717,497 742,462 7,413 735,049 Excess (deficiency) of revenues over (under) expenditures (672,497)(697,462)36,418 733,880 Other Financing Sources Transfers in --500,000 500,000 Total other financing sources --500,000 500,000 Net change in fund balance $(672,497)$(697,462)536,418 $1,233,880 Fund Balance, Beginning 1,647,067 Fund Balance, Ending $2,183,485 110 144 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Debt Service Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Taxes: Property $2,082,950 $2,082,950 $2,095,213 $12,263 Other taxes 530,400 530,400 695,377 164,977 Investment income 9,900 9,900 10,374 474 Total revenues 2,623,250 2,623,250 2,800,964 177,714 Expenditures Current: General government 3,500 3,500 1,312 2,188 Debt service: Principal retirement 2,009,666 2,009,666 2,009,665 1 Interest and fiscal charges 957,822 957,822 957,831 (9) Total expenditures 2,970,988 2,970,988 2,968,808 2,180 Excess (deficiency) of revenues over (under) expenditures (347,738)(347,738)(167,844)179,894 Other Financing Sources (Uses) Transfers in 361,313 361,313 361,313 - Transfers out (500,000)(500,000)(500,000)- Refunding debt issued --7,590,000 7,590,000 Premium on debt issued --511,784 511,784 Payment to refunded bonds escrow agent --(8,101,528)(8,101,528) Total other financing sources (uses)(138,687)(138,687)(138,431)256 Net change in fund balance $(486,425)$(486,425)(306,275)$180,150 Fund Balance, Beginning 1,900,735 Fund Balance, Ending $1,594,460 111 145 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Laurel/W estern Redevelopment TIF Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Property taxes $1,190,000 $1,190,000 $1,290,630 $100,630 Investment income --1,102 1,102 Total revenues 1,190,000 1,190,000 1,291,732 101,732 Expenditures General government 490,500 490,500 120,205 370,295 Capital outlay 100,000 100,000 -100,000 Contingency 95,182 95,182 -95,182 Total expenditures 685,682 685,682 120,205 565,477 Excess (deficiency) of revenues over (under) expenditures 504,318 504,318 1,171,527 667,209 Other Financing Sources (Uses) Transfers out (361,315)(361,315)(861,313)(499,998) Total other financing sources (uses)(361,315)(361,315)(861,313)(499,998) Net change in fund balance $143,003 $143,003 310,214 $167,211 Fund Balance (Deficit), Beginning (304,215) Fund Balance, Ending $5,999 112 146 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Capital Improvements Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Taxes Property $1,551,489 $1,551,489 $1,543,453 $(8,036) Other taxes 1,960,400 1,960,400 3,788,550 1,828,150 Charges for services 102,760 102,760 198,013 95,253 Grants and contributions 77,962 269,152 62,411 (206,741) Investment income 26,969 26,969 87,418 60,449 Miscellaneous 5,000 5,000 960 (4,040) Total revenues 3,724,580 3,915,770 5,680,805 1,765,035 Expenditures Current: General government 394,500 597,960 535,401 62,559 Highways and streets 1,500,000 1,515,226 1,141,352 373,874 Sanitation 28,000 60,999 10,423 50,576 Culture and recreation --4,911 (4,911) Capital outlay 7,483,952 7,833,784 2,488,782 5,345,002 Contingency 1,007,042 1,007,042 -1,007,042 Total expenditures 10,413,494 11,015,011 4,180,869 6,834,142 Excess (deficiency) of revenues over (under) expenditures (6,688,914)(7,099,241)1,499,936 8,599,177 Other Financing Sources (Uses) Transfers in 750,000 750,000 4,650,000 3,900,000 Proceeds from capital asset sales 20,000 20,000 -(20,000) Total other financing sources (uses)770,000 770,000 4,650,000 3,880,000 Net change in fund balance $(5,918,914)$(6,329,241)6,149,936 $12,479,177 Fund Balance, Beginning 16,190,839 Fund Balance, Ending $22,340,775 113 147 Major Enterprise Fund Waterworks and Sewerage Fund –This fund accounts for the provision of water and sewer service to the residents of the City. Nonmajor Enterprise Fund Deerpath Golf Course Fund –This fund accounts for operations of the City golf course. Financing is provided by user charges from utilizing the golf course. 148 City of Lake Forest Schedule of Revenues, Expenses and Nonoperating Revenues (Expenses) - Budget and Actual (Budgetary Basis) - Waterworks and Sewerage Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Operating Revenues Charges for services $8,557,368 $8,557,368 $9,845,800 $1,288,432 Connection fees 95,000 95,000 219,227 124,227 Miscellaneous 7,927 7,927 4,576 (3,351) Total operating revenues 8,660,295 8,660,295 10,069,603 1,409,308 Operating Expenses General and administrative 2,593,871 2,593,871 1,771,706 822,165 Operations and maintenance 3,204,122 3,564,122 2,402,363 1,161,759 Contingency 975,479 975,479 -975,479 Total operating expenses 6,773,472 7,133,472 4,174,069 2,959,403 Nonoperating Revenues (Expenses) Investment income 37,100 37,100 54,316 17,216 Principal retirement (1,782,347)(1,782,347)(1,782,347)- Interest expense (513,448)(513,448)(305,982)207,466 Paying agent fees (1,000)(1,000)(905)95 Total nonoperating revenues (expenses)(2,259,695)(2,259,695)(2,034,918)224,777 Contribution and Transfers Transfers in --2,500 2,500 Net contribution and transfers --2,500 2,500 114 149 City of Lake Forest Schedule of Revenues, Expenses and Nonoperating Revenues (Expenses) - Budget and Actual (Budgetary Basis) - Deerpath Golf Course Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Operating Revenues Charges for services $1,631,291 $1,631,291 $1,822,996 $191,705 Miscellaneous 5,033 5,033 1,688 (3,345) Total operating revenues 1,636,324 1,636,324 1,824,684 188,360 Operating Expenses General and administrative 716,620 716,620 694,959 21,661 Operations and maintenance 1,634,646 1,634,646 1,169,159 465,487 Contingency 245,465 245,465 -245,465 Total operating expenses 2,596,731 2,596,731 1,864,118 732,613 Nonoperating Revenues (Expenses) Investment income --2,441 2,441 Principal retirement (89,600)(89,600)(89,600)- Interest expense (13,285)(13,285)(3,729)9,556 Paying agent fees (500)(500)(8)492 Other --4,137 4,137 Total nonoperating revenues (expenses)(103,385)(103,385)(86,759)16,626 Contribution and Transfers Captial contributions 693,083 693,083 554,466 (138,617) Transfers in 50,000 50,000 50,000 - Net contribution and transfers 743,083 743,083 604,466 (138,617) 115 150 Internal Service Funds Fleet Fund –This fund accounts for the costs of operating a maintenance and repairs facility for automotive and other equipment used by other City departments.Such costs are billed to the other departments at actual cost plus an allocation of administrative costs based on actual costs. The automotive and other equipment is acquired by the various user departments. Self Insurance Fund –This fund accounts for the costs of the self-insured medical and dental plan. Administration of the plan is provided by Professional Benefit Administration, Inc. Liability Insurance Fund–This fund accounts for the costs of liability insurance. 151 City of Lake Forest Combining Statement of Net Position Internal Service Funds April 30, 2022 Fleet Self Insurance Liability Insurance Total Assets Current assets: Cash and cash equivalents $580,977 $5,563,828 $2,060,532 $8,205,337 Receivables: Other 5,940 30,584 5,700,916 5,737,440 Inventories 498,271 --498,271 Prepaid items --748,187 748,187 Total current assets 1,085,188 5,594,412 8,509,635 15,189,235 Noncurrent assets: Net pension asset 623,708 --623,708 Capital assets (net of accumulated depreciation): Property and equipment 48,047 --48,047 Accumulated depreciation (48,047)--(48,047) Total noncurrent assets 623,708 --623,708 Total assets 1,708,896 5,594,412 8,509,635 15,812,943 Deferred Outflows of Resources Deferred outflows related to pensions 77,171 --77,171 Deferred outflows related to total OPEB liability 7,972 --7,972 Total deferred outflows of resources 85,143 --85,143 Liabilities Current liabilities: Accounts payable 24,515 778,899 120,162 923,576 Accrued liabilities 11,143 839,378 95,227 945,748 Total current liabilities 35,658 1,618,277 215,389 1,869,324 Noncurrent liabilities: Compensated absences 35,186 --35,186 Total OPEB liability 58,091 --58,091 Total noncurrent liabilities 93,277 --93,277 Total liabilities 128,935 1,618,277 215,389 1,962,601 Deferred Inflows of Resources Deferred inflows related to pensions 642,948 --642,948 Deferred inflows related to total OPEB liability 14,876 --14,876 Total deferred inflows of resources 657,824 --657,824 Net Position Restricted for: Employee retirement 623,708 --623,708 Unrestricted 383,572 3,976,135 8,294,246 12,653,953 Total net position $1,007,280 $3,976,135 $8,294,246 $13,277,661 116 152 City of Lake Forest Combining Statement of Revenues, Expenses and Changes in Fund Net Position Internal Service Funds Year Ended April 30, 2022 Fleet Self Insurance Liability Insurance Totals Operating Revenues Charges for services $1,877,530 $5,514,731 $2,595,333 $9,987,594 Total operating revenues 1,877,530 5,514,731 2,595,333 9,987,594 Operating Expenses General and administrative 1,720,475 6,475,190 1,165,352 9,361,017 Total operating expenses 1,720,475 6,475,190 1,165,352 9,361,017 Operating income 157,055 (960,459)1,429,981 626,577 Nonoperating Revenues Investment income 3,337 21,627 10,671 35,635 Total nonoperating revenues 3,337 21,627 10,671 35,635 Income before transfers 160,392 (938,832)1,440,652 662,212 Transfers Transfers in -650,000 -650,000 Total transfers -650,000 -650,000 Change in net position 160,392 (288,832)1,440,652 1,312,212 Net Position, Beginning 846,888 4,264,967 6,853,594 11,965,449 Net Position, Ending $1,007,280 $3,976,135 $8,294,246 $13,277,661 117 153 City of Lake Forest Combining Statement of Cash Flows Internal Service Funds Year Ended April 30, 2022 Fleet Self Insurance Liability Insurance Total Cash Flows From Operating Activities Received from customers $1,871,590 $5,512,157 $1,327,356 $8,711,103 Paid to suppliers for goods and services (1,204,616)(6,501,014)(1,291,597)(8,997,227) Paid to employees for services (823,431)--(823,431) Net cash flows from operating activities (156,457)(988,857)35,759 (1,109,555) Cash Flows From Investing Activities Investment income 3,337 21,627 10,671 35,635 Net cash flows from investing activities 3,337 21,627 10,671 35,635 Cash Flows From Noncapital Financing Activities Transfers from (to) other funds -650,000 -650,000 Net cash flows from noncapital financing activities -650,000 -650,000 Net change in cash and cash equivalents (153,120)(317,230)46,430 (423,920) Cash and Cash Equivalents, Beginning 734,097 5,881,058 2,014,102 8,629,257 Cash and Cash Equivalents, Ending $580,977 $5,563,828 $2,060,532 $8,205,337 Reconciliation of Operating Income to Net Cash Flows From Operating Activities Operating income $157,055 $(960,459)$1,429,981 $626,577 Changes in assets and liabilities: Accounts receivable (5,940)(2,574)(1,267,977)(1,276,491) Inventories (82,392)--(82,392) Prepaid items --(123,910)(123,910) Net pension asset (441,796)--(441,796) Deferred outflows related to pensions (24,671)--(24,671) Accounts payable 12,415 (88,821)12,745 (63,661) Accrued liabilities 289 62,997 (15,080)48,206 Deferred inflows related to pensions 231,345 --231,345 Compensated absences (3,152)--(3,152) Deferred outflows related to total OPEB liability 1,048 --1,048 Deferred inflows related to total OPEB liability 3,034 --3,034 Total OPEB liability (3,692)--(3,692) Net cash flows from operating activities $(156,457)$(988,857)$35,759 $(1,109,555) 118 154 City of Lake Forest Schedule of Revenues, Expenses and Nonoperating Revenues - Budget and Actual (Budgetary Basis) Fleet Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Operating Revenues Charges for services $1,868,437 $1,868,437 $1,877,530 $9,093 Total operating revenues 1,868,437 1,868,437 1,877,530 9,093 Operating Expenses General and administrative 1,967,728 1,967,728 1,720,475 247,253 Contingency 196,773 196,773 -196,773 Total operating expenses 2,164,501 2,164,501 1,720,475 444,026 Nonoperating Revenues Investment income 3,200 3,200 3,337 137 Total nonoperating revenues 3,200 3,200 3,337 137 Net income (292,864)(292,864)160,392 453,256 Change in net position $(292,864)$(292,864)160,392 $453,256 Net Position, Beginning 846,888 Net Position, Ending $1,007,280 119 155 City of Lake Forest Schedule of Revenues, Expenses and Nonoperating Revenues - Budget and Actual (Budgetary Basis) Self Insurance Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Operating Revenues Charges for services $5,611,500 $5,611,500 $5,514,731 $(96,769) Total operating revenues 5,611,500 5,611,500 5,514,731 (96,769) Operating Expenses General and administrative 5,789,000 5,789,000 6,475,190 (686,190) Contingency 578,900 578,900 -578,900 Total operating expenses 6,367,900 6,367,900 6,475,190 (107,290) Nonoperating Revenues Investment income 40,000 40,000 21,627 (18,373) Total nonoperating revenues 40,000 40,000 21,627 (18,373) Net loss (716,400)(716,400)(938,832)(222,432) Contribution and Transfers Transfers in --650,000 650,000 Net contribution and transfers --650,000 650,000 Change in net position $(716,400)$(716,400)(288,832)$427,568 Net Position, Beginning 4,264,967 Net Position, Ending $3,976,135 120 156 City of Lake Forest Schedule of Revenues, Expenses and Nonoperating Revenues - Budget and Actual (Budgetary Basis) Liability Insurance Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Operating Revenues Charges for services $1,327,348 $1,327,348 $2,595,333 $1,267,985 Total operating revenues 1,327,348 1,327,348 2,595,333 1,267,985 Operating Expenses General and administrative 1,250,000 1,250,000 1,165,352 84,648 Contingency 125,000 125,000 -125,000 Total operating expenses 1,375,000 1,375,000 1,165,352 209,648 Nonoperating Revenues Investment income 10,000 10,000 10,671 671 Total nonoperating revenues 10,000 10,000 10,671 671 Change in net position $(37,652)$(37,652)1,440,652 $1,478,304 Net Position, Beginning 6,853,594 Net Position, Ending $8,294,246 121 157 Pension Trust Funds Police Pension Fund –This fund accounts for the accumulation of resources to be used for disability or retirement annuity payments to uniformed police department personnel at appropriate amounts and times in the future. Resources are contributed by employees at rates fixed by law and by the City at amounts determined by an independent actuary from a specific property tax levy. Firefighters’ Pension Fund –This fund accounts for the accumulation or resources to be used for disability or retirement annuity payments to uniformed fire department personnel at appropriate amounts and times in the future. Resources are contributed by employees at rates fixed by law and by the City at amounts determined by an independent actuary from a specific property tax levy. Private Purpose Trust Fund Cemetery Trust Fund –This fund accounts for monies provided by private donations. The investment earnings are expended for the operations of the cemetery. . 158 City of Lake Forest Combining Statement of Fiduciary Net Position Pension Trust Funds April 30, 2022 Police Pension Firefighters' Pension Total Assets Cash $413,924 $548,543 $962,467 Money markets 242,727 -242,727 Investments: U.S. Treasury obligations 7,961,878 -7,961,878 Municipal/corporate bonds 5,822,089 -5,822,089 Mutual funds 22,987,786 -22,987,786 Real estate investment fund 5,072,527 -5,072,527 Firefighters pension investment fund -46,304,968 46,304,968 Receivables 74,197 -74,197 Prepaid items 7,630 4,338 11,968 Due from primary government 47,235 26,841 74,076 Total assets 42,629,993 46,884,690 89,514,683 Liabilities Accounts payable 18,119 8,675 26,794 Total liabilities 18,119 8,675 26,794 Net Position Restricted for pension benefits $42,611,874 $46,876,015 $89,487,889 122 159 City of Lake Forest Combining Statement of Changes in Fiduciary Net Position Pension Trust Funds Year Ended April 30, 2022 Police Pension Firefighters' Pension Total Additions Contributions: Employer $3,379,444 $2,398,803 $5,778,247 Employee 474,817 343,611 818,428 Total contributions 3,854,261 2,742,414 6,596,675 Investment income: Interest 706,565 472,431 1,178,996 Net appreciation (depreciation) in fair value of investments (1,500,952)(2,989,435)(4,490,387) Total Investment income (loss)(794,387)(2,517,004)(3,311,391) Less investment expense (88,811)(56,685)(145,496) Net investment income (883,198)(2,573,689)(3,456,887) Miscellaneous 100 -100 Total additions 2,971,163 168,725 3,139,888 Deductions Pension benefits and refunds 3,499,389 3,093,703 6,593,092 Other administrative expenses 59,832 43,818 103,650 Total deductions 3,559,221 3,137,521 6,696,742 Change in net position (588,058)(2,968,796)(3,556,854) Net Position, Beginning 43,199,932 49,844,811 93,044,743 Net Position, Ending $42,611,874 $46,876,015 $89,487,889 123 160 City of Lake Forest Schedule of Changes in Fiduciary Net Position - Budget and Actual Police Pension Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Additions Contributions: Employer $3,388,076 $3,388,076 $3,379,444 $(8,632) Employee 402,326 402,326 474,817 72,491 Total contributions 3,790,402 3,790,402 3,854,261 63,859 Investment income: Interest 615,000 615,000 706,565 91,565 Net appreciation (depreciation) in fair value of investments 2,050,379 2,050,379 (1,500,952)(3,551,331) Total investment income 2,665,379 2,665,379 (794,387)(3,459,766) Less investment expense (150,000)(150,000)(88,811)61,189 Net investment income 2,515,379 2,515,379 (883,198)(3,398,577) Miscellaneous --100 100 Total additions 6,305,781 6,305,781 2,971,163 (3,334,618) Deductions Pension benefits and refunds 3,125,000 3,125,000 3,499,389 (374,389) Other administrative expenses 70,335 70,335 59,832 10,503 Contingency 334,534 334,534 -334,534 Total deductions 3,529,869 3,529,869 3,559,221 (29,352) Change in net position $2,775,912 $2,775,912 (588,058)$(3,363,970) Net Position, Beginning 43,199,932 Net Position, Ending $42,611,874 124 161 City of Lake Forest Schedule of Changes in Fiduciary Net Position - Budget and Actual Firefighters' Pension Fund Year Ended April 30, 2022 Budgeted Amounts Original Final Actual Variance with Final Budget Additions Contributions: Employer $2,406,318 $2,406,318 $2,398,803 $(7,515) Employee 325,337 325,337 343,611 18,274 Total contributions 2,731,655 2,731,655 2,742,414 10,759 Investment income: Interest 768,000 768,000 472,431 (295,569) Net appreciation (depreciation) in fair value of investments 2,332,973 2,332,973 (2,989,435)(5,322,408) Total investment income 3,100,973 3,100,973 (2,517,004)(5,617,977) Less Investment expense (80,000)(80,000)(56,685)23,315 Net investment income 3,020,973 3,020,973 (2,573,689)(5,594,662) Total additions 5,752,628 5,752,628 168,725 (5,583,903) Deductions Pension benefits and refunds 3,004,000 3,004,000 3,093,703 (89,703) Other administrative expenses 65,335 65,335 43,818 21,517 Contingency 314,934 314,934 -314,934 Total deductions 3,384,269 3,384,269 3,137,521 246,748 Change in net position $2,368,359 $2,368,359 (2,968,796)$(5,337,155) Net Position, Beginning 49,844,811 Net Position, Ending $46,876,015 125 162 Discretely Presented Component Unit Lake Forest Library – General Fund – This fund accounts for the operation and maintenance of the Lake Forest Library. Financing is provided by a specific annual property tax levy, charges for services, fines and forfeits, interest earned on investments and other miscellaneous revenues. 163 126 City of Lake Forest Discretely Presented Component Unit - Lake Forest Library Statement of Net Position and General Fund Balance Sheet General Statement of Fund Adjustments Net Position Assets and Deferred Outflows of Resources Assets Cash and cash equivalents 7,193,111$ -$ 7,193,111$ uncollectibles) 4,417,017 - 4,417,017 24,562 - 24,562 Net pension asset - 1,477,936 1,477,936 Capital assets not depreciated - 238,500 238,500 Capital assets depreciated, net of accumulated depreciation - 2,311,482 2,311,482 11,634,690 4,027,918 15,662,608 Deferred outflows of Resources Deferred outflows related to pensions - 202,218 202,218 Deferred outflows related to total OPEB liability - 5,301 5,301 - 207,519 207,519 11,634,690$ 4,235,437$ 15,870,127$ Liabilities, Deferred Inflows of Resources and Fund Balance/Net Position Liabilities 85,718$ -$ 85,718$ 60,348 - 60,348 Long-term obligations Due within one year - 18,309 18,309 Due in more than one year - 223,520 223,520 146,066 241,829 387,895 Deferred Inflows of Resources Property taxes levied for future periods 4,417,017 - 4,417,017 Deferred inflows related to pensions 1,523,526 1,523,526 Deferred inflows related to total OPEB liability - 19,134 19,134 4,417,017 1,542,660 5,959,677 Fund Balance/Net Position Unassigned 7,071,607 (7,071,607) - Net position Net investment in capital assets - 2,536,673 2,536,673 Restricted for employee retirement - 1,477,936 1,477,936 Unrestricted - 5,507,946 5,507,946 7,071,607 2,450,948 9,522,555 11,634,690$ 4,235,437$ 15,870,127$ Accounts payable Accrued liabilities April 30, 2022 Property taxes Receivables (net of allowance for Other taxes Total assets Capital assets Total deferred outflows of resources Total assets and deferred outflows of resources Total fund balance/net position Total deferred inflows of resources Total liabilities Total liabilities, deferred inflows of position resources and fund balance/net 164 127 City of Lake Forest Discretely Presented Component Unit - Lake Forest Library Statement of Activities and General Fund Statement of Revenues, Expenditures and Changes in Fund Balance Year Ended April 30, 2022 Statement General of Fund Adjustments Activities Revenues 4,375,175$ -$ 4,375,175$ 101,341 - 101,341 57,000 - 57,000 44,898 - 44,898 Fines 2,895 - 2,895 37,504 - 37,504 4,618,813 - 4,618,813 Expenditures/expenses Current 3,523,888 (358,468) 3,165,420 Capital outlay 173,737 (173,737) - Total expenditures/expenses 3,697,625 (532,205) 3,165,420 Net change in fund balance/net position 921,188 532,205 1,453,393 6,150,419 1,918,743 8,069,162 Fund Balance/Net Position, Ending 7,071,607$ 2,450,948$ 9,522,555$ Fund Balance/Net Position, Beginning Property taxes Charges for services Total revenues Intergovernmental Grants and contributions Investment Income 165 128 City of Lake Forest Summary of Debt Service Requirements to Maturity April 30, 2022 General Fiscal Obligation Year Bonds 2023 5,371,865$ 2024 4,981,175 2025 2,970,216 2026 2,978,966 2027 2,965,164 2028 2,979,115 2029 3,240,927 2030 3,262,836 2031 3,389,887 2032 3,399,562 2033 3,366,723 2034 2,402,563 2035 1,149,063 2036 1,150,250 2037 1,145,275 2038 786,600 45,540,187$ 166 129 City of Lake Forest Debt Service Requirements to Maturity - General Obligation Bonds April 30, 2022 Year Principal Interest Principal Interest Principal Interest 2023 75,000$ 2,213$ 20,701$ 704$ 143,508$ 10,448$ 2024 - - - - 150,612 5,497 2025 - - - - - - 2026 - - - - - - 2027 - - - - - - 2028 - - - - - - 2029 - - - - - - 2030 - - - - - - 2031 - - - - - - 2032 - - - - - - 2033 - - - - - - 2034 - - - - - - 2035 - - - - - - 2036 - - - - - - 2037 - - - - - - 2038 - - - - - - 75,000$ 2,213$ 20,701$ 704$ 294,120$ 15,945$ Fiscal Tax Bonds Tax Bonds Tax Bonds Special Service Area 25 Special Service Area 26 Special Service Area 29 167 130 City of Lake Forest Debt Service Requirements to Maturity - General Obligation Bonds April 30, 2022 Year Principal Interest Principal Interest Principal Interest 2023 355,000$ 260,925$ -$ 271,153$ 3,030,000$ 467,463$ 2024 370,000 252,050 515,000 271,153 2,370,000 315,963 2025 385,000 242,800 525,000 260,853 630,000 197,463 2026 405,000 233,175 535,000 247,728 660,000 165,963 2027 410,000 223,050 550,000 234,352 695,000 132,962 2028 435,000 212,800 565,000 220,602 730,000 98,213 2029 650,000 200,837 580,000 206,477 735,000 83,613 2030 695,000 181,337 590,000 191,687 755,000 68,912 2031 740,000 160,488 610,000 173,987 780,000 53,812 2032 705,000 136,438 630,000 155,687 810,000 37,237 2033 720,000 113,525 645,000 136,787 845,000 19,011 2034 1,530,000 90,125 665,000 117,438 - - 2035 330,000 36,575 685,000 97,488 - - 2036 340,000 25,025 710,000 75,225 - - 2037 350,000 13,125 730,000 52,150 - - 2038 - - 760,000 26,600 - - 8,420,000$ 2,382,275$ 9,295,000$ 2,739,367$ 12,040,000$ 1,640,612$ Fiscal Series 2019Series 2015 Series 2017 Obligation Bonds Obligation Bonds Obligation Bonds 168 131 City of Lake Forest Debt Service Requirements to Maturity - General Obligation Bonds April 30, 2022 Fiscal Year Principal Interest Principal Interest Total 2023 545,000$ 189,750$ 4,169,209$ 1,202,656$ 5,371,865$ 2024 590,000 140,900 3,995,612 985,563 4,981,175 2025 600,000 129,100 2,140,000 830,216 2,970,216 2026 615,000 117,100 2,215,000 763,966 2,978,966 2027 615,000 104,800 2,270,000 695,164 2,965,164 2028 625,000 92,500 2,355,000 624,115 2,979,115 2029 705,000 80,000 2,670,000 570,927 3,240,927 2030 715,000 65,900 2,755,000 507,836 3,262,836 2031 820,000 51,600 2,950,000 439,887 3,389,887 2032 890,000 35,200 3,035,000 364,562 3,399,562 2033 870,000 17,400 3,080,000 286,723 3,366,723 2034 - - 2,195,000 207,563 2,402,563 2035 - - 1,015,000 134,063 1,149,063 2036 - - 1,050,000 100,250 1,150,250 2037 - - 1,080,000 65,275 1,145,275 2038 - - 760,000 26,600 786,600 7,590,000$ 1,024,250$ 37,734,821$ 7,805,366$ 45,540,187$ Requirements Series 2021 Obligation Bonds Total 169 132 City of Lake Forest Special Service Area 25 Special Tax Bonds – 2003 Series April 30, 2022 Date of issue:May 1, 2003 Date of maturity:December 15, 2022 Authorized issue:$1,050,000 Denomination of bonds:$5,000 Interest rate:1.95-2.95% Interest dates:June 15 and December 15 Payable at:Lake Forest Bank and Trust Lake Forest, Illinois Redeemable Annually on December 15 Amount 2022 75,000 75,000$ Bond Principal and Interest Requirements Tax Levy Tax Levy Year Principal Interest Total June 15 Amount December 15 Amount 2021 75,000$ 2,213$ 77,213$ 2022 1,107 2022 1,106 75,000$ $2,213$ $77,213$ Coupons Due on 170 133 City of Lake Forest Special Service Area 26 Special Tax Bonds – 2003 Series April 30, 2022 Date of issue:October 7, 2003 Date of maturity:December 15, 2022 Authorized issue:$276,500 Denomination of bonds:One bond per maturity Interest rates:2.5-3.4% Interest dates:June 15 and December 15 Payable at:Lake Forest Bank and Trust Lake Forest, Illinois Redeemable Annually on December 15 Amount 2022 20,701 20,701$ Bond Principal and Interest Requirements Tax Levy Tax Levy Year Principal Interest Total June 15 Amount December 15 Amount 2021 20,701$ 704$ 21,405$ 2022 352$ 2022 352$ 20,701$ 704$ 21,405$ Coupons Due on 171 134 City of Lake Forest Special Service Area 29 Special Tax Bonds - 2004 Series April 30, 2022 Date of issue: Date of maturity:December 15, 2023 Authorized issue:$2,000,000 Denomination of bonds:One bond per maturity Interest rates:2.55-3.65% Interest dates:June 15 and December 15 Payable at:Lake Forest Bank and Trust Lake Forest, Illinois Redeemable Annually on December 15 Amount 2022 143,508$ 2023 150,612 294,120$ Bond Principal and Interest Requirements Tax Levy Tax Levy Year Principal Interest Total June 15 Amount December 15 Amount 2021 143,508$ 10,448$ 153,956$ 2022 5,224 2022 5,224 2022 150,612 5,497 156,109 2023 2,749 2023 2,748 294,120$ 15,945$ 310,065$ Coupons Due on December 20, 2004 172 135 City of Lake Forest General Obligation Bonds – 2015 April 30, 2022 Date of issue: Date of maturity:December 15, 2036 Authorized issue:$9,780,000 Denomination of bonds:$5,000 Interest rates:2.50 - 3.75% Interest dates:June 15 and December 15 Payable at:Wells Fargo Bank Chicago, Illinois Redeemable Annually on December 15 Amount 2022 355,000$ 2023 370,000 2024 385,000 2025 405,000 2,026 410,000 Thereafter 6,495,000 8,420,000$ Bond Principal and Interest Requirements Tax Levy Tax Levy Year Principal Interest Total June 15 Amount December 15 Amount 2021 355,000$ 260,925$ 615,925$ 2022 130,463$ 2022 130,462$ 2022 370,000 252,050 622,050 2023 126,025 2023 126,025 2023 385,000 242,800 627,800 2024 121,400 2024 121,400 2024 405,000 233,175 638,175 2025 116,588 2025 116,587 2025 410,000 223,050 633,050 2026 111,525 2026 111,525 Thereafter 6,495,000 1,170,275 7,665,275 Thereafter 585,138 Thereafter 585,137 8,420,000$ 2,382,275$ 10,802,275$ August 3, 2015 Coupons Due on 173 136 City of Lake Forest General Obligation Bonds – 2017 April 30, 2022 Date of issue: Date of maturity:December 15, 2037 Authorized issue:$9,295,000 Denomination of bonds:$5,000 Interest rates:2.00 - 3.50% Interest dates:June 15 and December 15 Payable at:Bank of New York Mellon Chicago, Illinois Redeemable Annually on December 15 Amount 2022 -$ 2023 515,000 2024 525,000 2025 535,000 2026 550,000 Thereafter 7,170,000 9,295,000$ Bond Principal and Interest Requirements Tax levy Tax levy year Principal Interest Total June 15 Amount December 15 Amount 2021 -$ 271,153$ 271,153$ 2022 135,577$ 2022 135,576$ 2022 515,000 271,153 786,153 2023 135,577 2023 135,576 2023 525,000 260,853 785,853 2024 130,426 2024 130,427 2024 535,000 247,728 782,728 2025 123,864 2025 123,864 2025 550,000 234,352 784,352 2026 117,176 2026 117,176 Thereafter 7,170,000 1,454,128 8,624,128 Thereafter 727,064 Thereafter 727,064 9,295,000$ 2,739,367$ 12,034,367$ June 5, 2017 Coupons due on 174 137 City of Lake Forest General Obligation Bonds – 2019 April 30, 2022 Date of issue: Date of maturity:December 15, 2032 Authorized issue:$17,655,000 Denomination of bonds:$5,000 Interest rates:2.25 - 5.00% Interest dates:June 15 and December 15 Payable at:Amalgamated Bank Chicago, Illinois Redeemable Annually on December 15 Amount 2022 3,030,000$ 2023 2,370,000 2024 630,000 2025 660,000 2026 695,000 Thereafter 4,655,000 12,040,000$ Bond Principal and Interest Requirements Tax Levy Tax Levy Year Principal Interest Total June 15 Amount December 15 Amount 2021 3,030,000$ 467,462$ 3,497,462$ 2022 233,731$ 2022 233,731$ 2022 2,370,000 315,962 2,685,962 2023 157,981 2023 157,981 2023 630,000 197,462 827,462 2024 98,731 2024 98,731 2024 660,000 165,963 825,963 2025 82,982 2025 82,981 2025 695,000 132,963 827,963 2026 66,482 2026 66,481 Thereafter 4,655,000 360,800 5,015,800 Thereafter 180,400 Thereafter 180,400 12,040,000$ 1,640,612$ 13,680,612$ December 19, 2019 Coupons Due on 175 138 City of Lake Forest General Obligation Bonds – 2021 April 30, 2022 Date of issue: Date of maturity:December 15, 2032 Authorized issue:$7,590,000 Denomination of bonds:$5,000 Interest rates:2.00% Interest dates:June 15 and December 15 Payable at:Amalgamated Bank Chicago, Illinois Redeemable Annually on December 15 Amount 2022 545,000$ 2023 590,000 2024 600,000 2025 615,000 2026 615,000 Thereafter 4,625,000 7,590,000$ Bond Principal and Interest Requirements Tax Levy Tax Levy Year Principal Interest Total June 15 Amount December 15 Amount 2021 545,000$ 189,750$ 734,750$ 2022 94,875$ 2022 94,875$ 2022 590,000 140,900 730,900 2023 70,450 2023 70,450 2023 600,000 129,100 729,100 2024 64,550 2024 64,550 2024 615,000 117,100 732,100 2025 58,550 2025 58,550 2025 615,000 104,800 719,800 2026 52,400 2026 52,400 Thereafter 4,625,000 342,600 4,967,600 Thereafter 171,300 Thereafter 171,300 7,590,000$ 1,024,250$ 8,614,250$ September 15, 2021 Coupons Due on 176 139 City of Lake Forest Debt Service Fund Combining Balance Sheet April 30, 2022 Special Service Special Service Special Service 2004 Series B Area 25 Area 26 Area 29 2011B/2019 General General General General Obligation Obligation Obligation Obligation Bonds Bonds Bonds Bonds Assets Cash and cash equivalents 18,890$ 8,126$ 9,850$ 1,416,454$ uncollectibles): Property taxes 76,547 21,575 152,139 - - - - - Total assets 95,437$ 29,701$ 161,989$ 1,416,454$ Liabilities Accounts payable -$ -$ -$ -$ - - - - Deferred inflows of resources Property taxes levied for future periods 76,547 21,576 152,139 - Fund Balance Fund balance- restricted for debt service 18,890 8,125 9,850 1,416,454 Total deferred inflows of resources, liabilities and fund balances 95,437$ 29,701$ 161,989$ 1,416,454$ Receivables (net of allowance for Due from other governments Total Liabilities 177 140 2009/2019 2010/2019 2013/2021 2015 General General General General Obligation Obligation Obligation Obligation Bonds Bonds Bonds Bonds Total 35,278$ 59,637$ 40,921$ 5,306$ 1,594,462$ 252,396 574,794 730,975 253,926 2,062,352 - - - - - 287,674$ 634,431$ 771,896$ 259,232$ 3,656,814$ -$ -$ -$ -$ -$ - - - - - 252,397 574,794 730,975 253,926 2,062,354 35,277 59,637 40,921 5,306 1,594,460 287,674$ 634,431$ 771,896$ 259,232$ 3,656,814$ 178 141 City of Lake Forest Debt Service Fund Combining Schedule of Revenues, Expenditures and Changes in Fund Balances Year Ended April 30, 2022 Special Service Special Service Special Service 2004 Series B Area 25 Area 26 Area 29 2011B/2019 General General General General Obligation Obligation Obligation Obligation Bonds Bonds Bonds Bonds Revenues Taxes: Property taxes 79,849$ 23,129$ 152,403$ -$ Other - - - 695,377 Investment income 194 64 223 7,436 Total revenues 80,043 23,193 152,626 702,813 Expenditures General government - - - 45 Debt Service: Principal 75,000 19,743 136,869 453,053 Interest 4,350 1,375 15,033 71,672 Total expenditures 79,350 21,118 151,902 524,770 Excess (deficiency) of revenues over expenditures 693 2,075 724 178,043 Other financing sources: Transfers in - - - - Transfers out - - - (500,000) Refunding debt issued - - - - Premium on debt issued - - - - Payments to refunding escrow - - - - Total other financing sources (uses)- - - (500,000) Net change in fund balances 693 2,075 724 (321,957) Fund Balances, Beginning 18,197 6,050 9,126 1,738,411 Fund Balances, Ending 18,890$ 8,125$ 9,850$ 1,416,454$ 179 142 2009/2019 2010/2019 2013/2021 2015 General General General General Obligation Obligation Obligation Obligation Bonds Bonds Bonds Bonds Total 252,643$ 585,536$ 751,983$ 249,670$ 2,095,213$ - - - - 695,377 438 863 943 213 10,374 253,081 586,399 752,926 249,883 2,800,964 56 211 - 1,000 1,312 180,000 370,000 435,000 340,000 2,009,665 72,700 211,263 312,013 269,425 957,831 252,756 581,474 747,013 610,425 2,968,808 325 4,925 5,913 (360,542) (167,844) - - - 361,313 361,313 - - - - (500,000) - - 7,590,000 - 7,590,000 - - 511,784 - 511,784 - - (8,101,528) - (8,101,528) - - 256 361,313 (138,431) 325 4,925 6,169 771 (306,275) 34,952 54,712 34,752 4,535 1,900,735 35,277$ 59,637$ 40,921$ 5,306$ 1,594,460$ 180 Statistical Section Contents Page Financial Trends 143 Revenue Capacity 148 Debt Capacity 156 Demographic and Economic Information 161 Operating Information 164 This portion of the City of Lake Forest's Annual Comprehensive Financial Report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City's overall economic condition and financial health. Sources: Unless otherwise noted, the information in these schedules is derived from the annual comprehensive financial reports for the relevant year. These schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time. These schedules contain information to help the reader assess the factors affecting the City's ability to generate its property and sales taxes. These schedules present information to help the reader assess the affordability of the City's current levels of outstanding debt and the City's ability to issue additional debt. These schedules offer demographic and economic indicators to help the reader understand the environment within which the City's financial activities take place and to help make comparisons over time and other governments. These schedules contain information about the City's operations and resources to help the reader understand how the City's financial information relates to the services the City provides and the activities it performs. 181 143 City of Lake Forest Net Position by Component Last Ten Fiscal Years April 30, 2022 2013 2014 2015 2016*2017 2018 2019 2020 2021 2022 Governmental Activities Net investment in capital assets 187,500,531$ 184,270,349$ 181,056,601$ 181,481,470$ 170,568,584$ 166,607,491$ 164,675,251$ 165,179,598$ 164,798,332$ 165,811,050$ Restricted 16,064,099 16,860,362 15,737,797 18,506,073 15,476,976 20,193,505 26,714,972 27,807,934 36,509,516 57,740,630 Unrestricted 21,126,818 23,689,130 26,747,317 (18,479,928) (9,068,405) (11,006,718) (14,809,677) (18,261,240) (14,713,066) (21,655,117) 224,691,448$ 224,819,841$ 223,541,715$ 181,507,615$ 176,977,155$ 175,794,278$ 176,580,546$ 174,726,292$ 186,594,782$ 201,896,563$ Business-Type Activities Net investment in capital assets 36,077,752$ 36,163,443$ 36,617,378$ 37,582,505$ 37,504,482$ 40,729,712$ 39,610,155$ 39,052,272$ 38,142,896$ 38,585,070$ Restricted - - - - - - - - 580,012 1,957,016 Unrestricted 9,880,856 9,739,336 8,941,920 8,323,401 7,696,321 8,950,670 9,508,483 9,692,010 10,288,805 11,424,910 45,958,608$ 45,902,779$ 45,559,298$ 45,905,906$ 45,200,803$ 49,680,382$ 49,118,638$ 48,744,282$ 49,011,713$ 51,966,996$ Total Primary Government Net investment in capital assets 223,578,283$ 220,433,792$ 217,673,979$ 219,063,975$ 208,073,066$ 207,337,203$ 204,285,406$ 204,231,870$ 202,941,228$ 204,396,120$ Restricted 16,064,099 16,860,362 15,737,797 18,506,073 15,476,976 20,193,505 26,714,972 27,807,934 37,089,528 59,697,646 Unrestricted 31,007,674 33,428,466 35,689,237 (10,156,527) (1,372,084) (2,056,048) (5,301,194) (8,569,230) (4,424,261) (10,230,207) 270,650,056$ 270,722,620$ 269,101,013$ 227,413,521$ 222,177,958$ 225,474,660$ 225,699,184$ 223,470,574$ 235,606,495$ 253,863,559$ *Beginning in 2016, the City implemented GASB 68 which resulted in the inclusion of a net pension liability. Total governmental activities net position Total business-type activities Total primary government net position 182 144 Change in Net Position Last Ten Fiscal years Year Ended April 30, 2022 2013 2014 2015*2016 2017 2018 2019 2020 2021 2022 Expenses Governmental Activities General government 16,176,326$ 12,311,198$ 12,604,331$ 11,675,363$ 16,882,976$ 9,884,646$ 13,773,790$ 13,865,425$ 12,863,134$ 11,182,027$ Highway and streets 7,536,444 7,762,403 8,839,231 9,230,548 10,923,639 9,621,569 9,081,471 8,677,958 7,457,325 6,929,008 Sanitation 2,512,559 2,586,125 2,474,355 2,208,326 2,611,231 2,585,940 2,580,043 2,678,876 2,438,916 1,959,547 Culture and recreation 10,352,252 10,397,593 10,172,391 8,463,259 10,023,195 10,003,119 8,859,391 8,977,855 9,453,397 9,205,623 Public safety 13,748,855 14,430,151 15,303,399 16,360,830 17,048,209 17,017,092 19,769,395 23,338,259 16,854,590 20,578,227 Interest 1,362,715 1,333,267 1,357,552 1,293,742 1,559,100 1,271,181 1,231,944 1,115,802 920,485 871,548 51,689,151 48,820,737 50,751,259 49,232,068 59,048,350 50,383,547 55,296,034 58,654,175 49,987,847 50,725,980 Business-Type Activities Waterworks and sewerage 8,287,297 7,476,752 8,353,825 7,239,042 8,510,811 8,122,998 7,832,615 8,168,879 8,486,272 7,441,106 Golf 1,459,394 1,554,678 1,642,121 1,868,252 2,095,510 1,604,261 1,875,677 1,861,393 2,042,874 2,161,621 9,746,691 9,031,430 9,995,946 9,107,294 10,606,321 9,727,259 9,708,292 10,030,272 10,529,146 9,602,727 61,435,842$ 57,852,167$ 60,747,205$ 58,339,362$ 69,654,671$ 60,110,806$ 65,004,326$ 68,684,447$ 60,516,993$ 60,328,707$ Program Revenues Governmental Activities Charges for services: General government 4,838,151$ 4,756,948$ 5,442,475$ 8,191,440$ 8,860,169$ 5,203,210$ 5,007,655$ 4,077,609$ 3,754,897$ 4,296,082$ Highway and streets 753,487 741,334 710,795 990,840 782,953 1,006,644 2,730,122 2,183,456 2,476,794 2,726,225 Sanitation 58,564 77,147 682,062 697,435 734,111 721,276 749,620 1,040,121 1,053,692 1,040,338 Culture and recreation 3,342,913 3,314,856 3,156,699 3,257,796 2,810,762 3,491,365 3,117,795 2,594,119 1,733,927 2,885,644 Public safety 1,861,619 1,950,998 1,795,521 1,552,567 1,689,547 1,992,985 2,117,186 2,525,439 2,517,398 2,946,021 Operating grants and contributions 1,777,734 1,105,191 1,345,670 1,368,451 1,088,579 1,298,006 985,676 1,529,863 1,097,399 1,164,031 Capital grants and contributions 25,000 757,239 468,255 280,675 1,174,000 356,178 505,988 448,694 777,054 2,368,237 12,657,468 12,703,713 13,601,477 16,339,204 17,140,121 14,069,664 15,214,042 14,399,301 13,411,161 17,426,578 Business-Type Activities Charges for services: Waterworks and sewerage 8,598,079 7,521,323 8,034,469 7,477,558 7,873,741 8,083,554 7,818,777 7,512,450 8,569,806 9,695,464 Golf 1,320,455 1,397,836 1,414,217 1,759,271 1,606,661 1,480,618 1,524,654 1,459,127 1,864,338 1,824,684 Operating grants and contributions - - - - - - 228,332 - - - Capital grants and contributions - - - - - - - - - 554,466 9,918,534 8,919,159 9,448,686 9,236,829 9,480,402 9,564,172 9,571,763 8,971,577 10,434,144 12,074,614 22,576,002$ 21,622,872$ 23,050,163$ 25,576,033$ 26,620,523$ 23,633,836$ 24,785,805$ 23,370,878$ 23,845,305$ 29,501,192$ Net (Expense)/Revenue Governmental Activities (39,031,683)$ (36,117,024)$ (37,149,782)$ (32,892,864)$ (41,908,229)$ (36,313,883)$ (40,081,992)$ (44,254,874)$ (36,576,686)$ (33,299,402)$ Business-Type Activities 171,843 (112,271) (547,260) 129,535 (1,125,919) (163,087) (136,529) (1,058,695) (95,002) 2,471,887 (38,859,840)$ (36,229,295)$ (37,697,042)$ (32,763,329)$ (43,034,148)$ (36,476,970)$ (40,218,521)$ (45,313,569)$ (36,671,688)$ (30,827,515)$ City of Lake Forest Total primary government net expense Total government program revenues Total business-type activities program revenues Total governmental activities program revenues Total primary government expenses Total business-type activities Total governmental activities expenses 183 145 Change in Net Position Last Ten Fiscal years Year Ended April 30, 2022 2013 2014 2015*2016 2017 2018 2019 2020 2021 2022 City of Lake Forest General Revenues and Other Changes in Net Position Governmental Activities Taxes: Property 25,051,411$ 23,744,650$ 24,468,769$ 25,006,224$ 25,928,864$ 26,193,444$ 27,591,773$ 28,569,827$ 30,459,112$ 32,149,905$ Sales 3,183,479 3,047,529 2,851,103 2,889,306 2,829,607 2,105,736 2,095,938 2,597,218 1,081,489 1,795,817 Income and use 2,131,711 2,182,325 2,386,567 2,251,828 2,306,546 2,272,639 2,593,506 2,584,198 3,223,407 3,829,655 Telecommunications and utility 3,736,586 4,026,972 3,954,001 3,551,491 3,596,175 3,440,365 3,603,381 3,170,895 3,102,515 3,285,771 Real estate transfer tax 1,209,113 1,633,580 1,224,610 1,288,175 1,398,160 1,622,900 1,471,595 1,256,265 2,735,405 2,652,110 Other 493,418 581,443 534,625 514,231 636,368 2,178,246 2,410,453 2,717,862 4,308,631 5,824,190 Investment earnings 491,196 637,193 547,118 145,329 1,042,049 1,665,391 2,215,202 1,664,355 3,564,117 (883,765) Miscellaneous 573,705 669,145 73,613 - - - - - - - Gain on sale of assets - - - - - (3,874) 7,775 38,500 - - Transfers (77,100) (97,000) (168,750) (924,496) (360,000) (4,343,841) 786,850 (198,500) (29,500) (52,500) 36,793,519 36,425,837 35,871,656 34,722,088 37,377,769 35,131,006 42,776,473 42,400,620 48,445,176 48,601,183 Business-Type Activities Investment earnings 37,853 38,550 33,408 40,362 58,366 236,990 279,189 175,969 42,285 56,757 Other - - 1,621 6,033 2,450 61,835 299,176 309,870 290,648 374,139 Transfers 77,100 97,000 168,750 924,496 360,000 4,343,841 (786,850) 198,500 29,500 52,500 114,953 135,550 203,779 970,891 420,816 4,642,666 (208,485) 684,339 362,433 483,396 36,908,472$ 36,561,387$ 36,075,435$ 35,692,979$ 37,798,585$ 39,773,672$ 42,567,988$ 43,084,959$ 48,807,609$ 49,084,579$ Changes in Net Position Governmental activities (2,238,164)$ 308,813$ (1,278,126)$ 1,829,224$ (4,530,460)$ (1,182,877)$ 2,694,481$ (1,854,254)$ 11,868,490$ 15,301,781$ Business-type activities 286,796 23,279 (343,481) 1,100,426 (705,103) 4,479,579 (345,014) (374,356) 267,431 2,955,283 (1,951,368)$ 332,092$ (1,621,607)$ 2,929,650$ (5,235,563)$ 3,296,702$ 2,349,467$ (2,228,610)$ 12,135,921$ 18,257,064$ *Starting in 2015, all taxes administered by the State and disbursed to the City are reported as intergovernmental revenues on the face of the financial statements. They have been grouped by tax type for comparison purposes above. Total primary government change in net position Total business-type activities Total primary government Total governmental activities 184 146 City of Lake Forest Fund Balances of Governmental Funds Last Ten Fiscal Years April 30, 2022 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 General Fund Nonspendable 2,775,449$ 2,126,990$ 1,648,832$ 1,272,224$ 778,160$ 150,038$ 129,280$ 143,703$ 208,661$ 91,038$ Restricted 957,420 957,420 957,420 - - - - - - - Unassigned 11,020,723 14,530,550 17,910,037 22,509,969 28,799,288 29,130,844 28,815,904 29,433,682 28,148,267 28,872,687 14,753,592$ 17,614,960$ 20,516,289$ 23,782,193$ 29,577,448$ 29,280,882$ 28,945,184$ 29,577,385$ 28,356,928$ 28,963,725$ All Other Governmental Funds Nonspendable 43,333$ -$ 381,173$ 408,539$ 536,121$ 28,688$ 32,837$ 29,139$ 28,878$ -$ Restricted 15,605,203 16,127,257 14,726,999 20,337,111 19,420,288 20,806,879 26,656,696 27,693,271 36,738,128 45,175,456 Assigned 1,598,819 1,449,284 1,448,736 1,456,053 - - - - - - Unassigned - - (1,022,136) - - - (3,686) (743,104) (304,215) - 17,247,355$ 17,576,541$ 15,534,772$ 22,201,703$ 19,956,409$ 20,835,567$ 26,685,847$ 26,979,306$ 36,462,791$ 45,175,456$ 32,000,947$ 35,191,501$ 36,051,061$ 45,983,896$ 49,533,857$ 50,116,449$ 55,631,031$ 56,556,691$ 64,819,719$ 74,139,181$ Total general fund governmental funds Total governmental funds 185 147 City of Lake Forest Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years Year Ended April 30, 2022 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Revenues Property taxes 25,051,411$ 23,744,650$ 24,468,769$ 25,006,224$ 25,928,864$ 26,193,444$ 27,591,773$ 28,569,827$ 30,459,112$ 32,149,905$ Other taxes 10,754,307 11,471,849 4,641,466 4,317,316 4,609,057 4,786,506 4,775,587 4,702,203 6,236,640 7,420,624 Intergovenmental revenues 612,357 576,125 6,972,923 6,680,193 6,656,768 6,331,183 6,717,794 7,274,602 7,982,783 9,381,665 Grants and contributions 1,190,377 962,249 950,823 1,056,523 1,419,736 997,289 2,220,550 1,082,083 1,959,289 803,304 Charges for services 7,319,673 7,373,500 7,935,973 8,506,756 8,005,317 8,833,079 8,759,327 8,749,224 7,611,794 9,915,260 Licenses and permits 2,450,194 2,477,338 2,821,066 5,222,568 5,157,398 3,232,276 3,456,703 2,954,115 3,133,137 3,460,452 Fines and forfeitures 368,941 297,005 287,333 260,407 321,168 345,438 355,304 271,985 260,726 256,681 Investment income (loss)462,579 610,601 524,150 115,462 989,515 1,553,167 2,043,136 1,534,251 3,531,497 (919,400) Miscellaneous revenue 1,225,082 759,384 790,344 779,137 841,731 1,831,152 1,511,534 1,360,723 1,346,521 1,777,933 49,434,921 48,272,701 49,392,847 51,944,586 53,929,554 54,103,534 57,431,708 56,499,013 62,521,499 64,246,424 Expenditures General government 14,242,768 10,112,393 10,248,830 10,811,408 11,581,286 10,469,740 11,657,265 11,960,755 13,142,471 12,312,871 Highways and streets 2,044,225 2,293,840 2,371,461 2,157,463 3,118,461 2,354,587 4,577,657 3,393,599 3,232,159 3,994,492 Sanitation 2,193,091 2,212,166 2,235,135 2,276,433 2,311,435 2,290,986 2,480,420 2,619,476 2,653,638 2,583,681 Culture and recreation 9,282,695 8,686,298 8,457,043 8,338,284 8,532,289 8,853,547 9,319,869 9,398,508 9,260,377 9,740,683 Public safety 13,826,732 14,299,583 14,469,408 15,090,712 15,126,874 15,520,779 16,900,348 18,456,208 18,449,813 19,464,610 Capital outlay 4,586,574 5,527,772 7,582,668 10,992,926 5,439,469 8,746,881 3,971,995 6,753,993 4,568,295 3,160,885 Debt service: Principal 1,377,736 1,400,950 1,623,436 1,791,579 7,906,696 1,782,156 1,429,625 1,730,850 1,910,089 2,009,665 Interest 1,392,342 1,319,276 1,400,609 1,293,634 1,639,191 1,277,596 1,242,498 1,202,730 1,026,472 957,831 48,946,163 45,852,278 48,388,590 52,752,439 55,655,701 51,296,272 51,579,677 55,516,119 54,243,314 54,224,718 Excess (deficiency) of revenues over expenditures 488,758 2,420,423 1,004,257 (807,853) (1,726,147) 2,807,262 5,852,031 982,894 8,278,185 10,021,706 Other Financing Sources (Uses) Transfers in 2,829,243 3,224,306 2,020,085 2,846,321 7,776,661 4,799,274 7,280,685 4,627,667 6,804,841 6,791,294 Transfers out (2,906,343) (3,321,306) (2,188,835) (2,895,321) (8,136,661) (7,050,020) (7,644,685) (4,826,167) (6,834,841) (7,493,794) Bonds issued - - - 9,780,000 - - - - - - Loan proceeds - - - 830,080 - - - - - - Premium (discount) on bonds issued - 26,093 - 106,384 - - - 797,619 - 511,784 Proceeds from refunding G.O. bonds - 9,715,000 - - - - - 10,751,022 - 7,590,000 Payments for refunding G.O. bonds - (9,665,000) - - - - - (11,445,875) - (8,101,528) Sale of capital assets 64,549 791,038 24,053 73,224 5,636,108 26,076 26,551 38,500 14,843 - (12,551) 770,131 (144,697) 10,740,688 5,276,108 (2,224,670) (337,449) (57,234) (15,157) (702,244) 476,207$ 3,190,554$ 859,560$ 9,932,835$ 3,549,961$ 582,592$ 5,514,582$ 925,660$ 8,263,028$ 9,319,462$ Debt service as a percentage of 5.85%6.17%6.43%6.54%17.36%6.49%5.42%5.78%5.76%5.92% Total revenues Total expenditures Total other financing sources (uses) Net changes in fund balances noncapital expenditures 186 148 City of Lake Forest Assessed Value and Actual Value of Taxable Property Last Ten Levy Years Levy Residential Commercial Industrial Other Tax Increment Total Taxable Total Direct Estimated Actual Estimated Actual Year Property Property Property Property Financing Assessed Value Tax Rate Taxable Value Taxable Value 2012 2,166,702,992$ 207,360,589$ 65,556$ 3,918,002$ -$ 2,378,047,139$ 1.1480 7,134,141,417$ 33.333% 2013 2,047,760,158 200,625,492 62,064 5,099,690 - 2,253,547,404 1.2480 6,760,642,212 33.333% 2014 2,047,998,906 196,562,054 61,541 5,846,135 - 2,250,468,636 1.2741 6,751,405,908 33.333% 2015 2,105,361,682 196,233,065 46,548 6,294,764 - 2,307,936,059 1.2794 6,923,808,177 33.333% 2016 2,226,672,717 209,668,706 49,445 6,591,173 90,630 2,443,072,671 1.2268 7,329,218,013 33.333% 2017 2,309,650,453 215,722,819 51,936 6,841,694 1,690,541 2,533,957,443 1.2366 7,601,872,329 33.333% 2018 2,305,181,606 214,536,978 52,832 7,152,663 4,202,435 2,531,126,514 1.2782 7,593,379,542 33.333% 2019 2,222,762,174 228,895,482 53,502 6,085,440 16,133,495 2,473,930,093 1.3721 7,421,790,279 33.333% 2020 2,168,305,007 221,826,768 55,722 6,474,628 22,935,969 2,419,598,094 1.4638 7,258,794,282 33.333% 2021 2,149,678,467 225,662,484 55,419 6,476,640 25,028,375 2,406,901,385 1.5217 7,220,704,155 33.333% Data Source Office of the County Clerk Note : Property is assessed at 33 1/3% of actual value; property tax rates per $100 of assessed valuation. The City's TIF Increment Financing district expired for 2012 A new City TIF Increment Financing district initiated for 2016 187 149 City of Lake Forest Property Tax Rates - Direct and Overlapping Governments Based on Shields Township Last Ten Levy Years 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Bonds 0.071 0.088 0.090 0.067 0.059 0.060 0.066 0.074 0.077 0.077 Corporate 0.544 0.580 0.590 0.619 0.603 0.600 0.620 0.646 0.663 0.683 Firemen's Pension 0.046 0.052 0.054 0.053 0.050 0.061 0.065 0.077 0.093 0.098 IMRF 0.035 0.037 0.038 0.037 0.035 0.035 0.035 0.037 0.039 0.040 Library 0.141 0.152 0.155 0.153 0.146 0.145 0.149 0.157 0.166 0.170 Library Sites & Building 0.016 0.017 0.017 0.017 0.016 0.016 0.016 0.017 0.018 0.018 Parks/Park Maintenance 0.123 0.191 0.194 0.196 0.187 0.184 0.188 0.197 0.139 0.229 Playground & Recreation **0.055 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.086 0.000 Police Pension 0.066 0.076 0.080 0.082 0.078 0.083 0.087 0.109 0.125 0.134 Ptab/CE Recapture 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.011 Recreation for Handicapped Rec.0.016 0.018 0.018 0.018 0.018 0.018 0.019 0.020 0.021 0.021 Social Security 0.035 0.037 0.038 0.037 0.035 0.035 0.035 0.037 0.039 0.040 City Direct Rates *1.148 1.248 1.274 1.279 1.227 1.237 1.280 1.371 1.464 1.522 Overlapping Rates College of Lake County 0.272 0.296 0.306 0.299 0.285 0.281 0.282 0.282 0.290 0.293 County of Lake 0.608 0.663 0.682 0.663 0.632 0.622 0.612 0.597 0.598 0.598 Lake County Forest Preserve 0.212 0.218 0.210 0.208 0.193 0.187 0.182 0.180 0.182 0.179 North Shore Sanitary District 0.150 0.164 0.169 0.166 0.157 0.153 0.153 0.153 0.157 0.158 School District 67, Elem.1.322 1.424 1.452 1.429 1.367 1.355 1.391 1.472 1.551 1.606 School District 115, High School 1.322 1.420 1.450 1.409 1.329 1.314 1.336 1.375 1.445 1.494 Township 0.036 0.037 0.039 0.038 0.036 0.035 0.035 0.036 0.037 0.037 Township Road and Bridge 0.029 0.032 0.033 0.032 0.031 0.030 0.031 0.032 0.033 0.034 Total tax rate 5.099 5.502 5.615 5.523 5.257 5.214 5.302 5.498 5.757 5.922 City's share of total tax rate 23%23%23%23%23%24%24%25%25%26% Data Source Office of the County Clerk - Shields Township Lake Forest lies within five townships - Moraine, Shields, Vernon, West Deerfield and Libertyville. Therefore, the tax rates for support of the Township government and for the Township Road and Bridge purposes vary. Parts of Shields Township in Lake Forest lie in the Lake Bluff Park District. All of Moraine Township is in Lake Forest and parts of Shields and West Deerfield Townships in Lake Forest lie in the North Shore Sanitary District. * Excludes rates for the Special Service Areas * Includes the City's component unit, Lake Forest Library ** Parks and Playgrounds combined in 2013 188 150 City of Lake Forest Principal Property Taxpayers Current Year and Nine Years Ago Taxable Percentage of Total Taxable Percentage of Total Assessed City Taxable Assessed City Taxable Taxpayer Value Rank Assessed Valuation Value Rank Assessed Valuation Hospira Inc 17,184,303$ 1 0.71%18,771,220$ 1 0.79% Kelmscott Park Apartments LLC 15,721,450 2 0.65% Abbot Laboratories 14,493,994 3 0.60% Chicago Title Land Trust Company 12,969,071 4 0.54% Lake Forest Place LLC 12,431,475 5 0.52% Chicago Bears Football Club, Inc 11,495,453 6 0.48%5,402,161 10 0.23% Conway Gateway LLC 10,634,216 7 0.44% Chicago Title Land Trust Co 10,628,487 8 0.44% CAI Investment Lake Forest Global 10,022,781 9 0.42% Lake Forest Investments 7,616,280 10 0.32% Lake Products, Inc 13,929,128 2 0.59% The Presbyterian Home 13,749,270 3 0.58% CBIZ Property Tax Solutions 11,196,536 4 0.47% Trustmark Insurance Co 7,750,771 5 0.33% Lake Forest Landmark Co. LLC 6,962,512 6 0.29% Northwestern Lake Forest Hospital 6,918,325 7 0.29% Lake Forest Landmark II 5,928,948 8 0.25% Shawgate Lake Forest, LLC 5,440,583 9 0.23% 123,197,510$ 5.12%96,049,454$ 4.05% Data Source Office of the County Clerk Note: Every effort has been made to seek out and report the largest taxpayers. However, many of the taxpayers contain multiple parcels, and it is possible that some parcels and their valuations have been overlooked. 2022 Column is 2021 Assessed Valuation 2013 Column is 2012 Assessed Valuation 2022 2013 189 151 City of Lake Forest Property Tax Levies and Collections Last Ten Levy Years Levy Percentage Subsequent Year Taxes Percentage Year Tax Levied Amount of Levy Collections Received of Levy 2012 27,299,981$ 27,198,985$ 99.63%384$ 27,199,369$ 99.63% 2013 28,124,272 28,002,008 99.57%14,464 28,016,472 99.62% 2014 28,673,693 28,608,680 99.77%14,056 28,622,736 99.82% 2015 29,528,749 29,468,310 99.80%10,693 29,479,003 99.83% 2016 29,970,699 29,839,108 99.56%781 29,839,889 99.56% 2017 31,313,227 31,250,130 99.80%9,178 31,259,308 99.83% 2018 32,533,539 32,427,323 99.67%1,981 32,429,304 99.68% 2019 33,955,313 33,779,271 99.48%151 33,779,422 99.48% 2020 35,081,741 35,150,336 100.20%960 35,151,295 100.20% 2021 36,244,390 N/A N/A N/A N/A N/A Data Source Lake County Treasurer and City Note: Property is assessed at 33 1/3 % of actual value. Collected within the Fiscal Year after the Levy Total Collections Per Levy 190 152 City of Lake Forest Tax Extensions for City Funds Last Ten Levy Years 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 General 0.544 0.580 0.590 0.619 0.603 0.600 0.617 0.646 0.663 0.683 IMRF/Social Security 0.070 0.074 0.076 0.074 0.070 0.070 0.071 0.074 0.078 0.079 Firefighter Pension 0.046 0.052 0.054 0.053 0.050 0.061 0.065 0.077 0.093 0.098 Police Pension 0.066 0.076 0.080 0.082 0.078 0.083 0.087 0.109 0.125 0.134 Parks and Recreation 0.178 0.191 0.194 0.196 0.187 0.184 0.188 0.196 0.224 0.229 Special Recreation 0.016 0.018 0.018 0.018 0.018 0.018 0.019 0.020 0.021 0.021 General Obligation Bond 2008 0.036 0.037 0.037 0.026 0.000 0.000 - - - - General Obligation Bond 2009 0.012 0.013 0.013 0.009 0.012 0.012 0.011 0.011 0.011 0.011 General Obligation Bond 2010 0.023 0.012 0.025 0.015 0.020 0.020 0.019 0.019 0.019 0.019 General Obligation Bond 2013 0.000 0.026 0.015 0.010 0.018 0.018 0.027 0.027 0.027 0.027 General Obligation Bond 2015 - - - 0.008 0.009 0.010 0.009 0.009 0.009 0.009 Total tax rate 0.991 1.079 1.102 1.110 1.065 1.076 1.113 1.188 1.269 1.311 Data Source Office of the County Clerk The tax rate for the City's component unit, Lake Forest Library is excluded from this table. This table excludes the tax rates for the Special Service Areas. 191 153 City of Lake Forest Sales Tax Base and Number of Principal Payers Taxable Sales by Category - Home Rule Sales Tax Last Ten Calendar Years 2013 2014 2015 2016 2017 2018 2019 2020 2021 General Merchandise 9,722$ 7,005$ 7,471$ 5,072$ 4,358$ 4,215$ 5,854$ 4,980$ 2,427$ Food 93,952 105,771 96,009 92,936 93,838 95,457 144,134 189,599 203,271 Drinking and Eating Places 165,386 180,023 163,447 173,473 182,278 177,620 261,770 216,636 290,619 Apparel 68,135 68,291 75,606 73,785 72,540 67,069 116,944 115,308 181,680 Furniture & H.H. & Radio 38,821 39,494 36,526 32,774 28,424 29,524 47,907 62,235 111,261 Lumber, Building, Hardware 9,862 - - 7,537 8,238 9,633 17,362 27,244 30,082 Automobile and Filling Stations 37,025 34,895 28,267 26,735 30,895 35,146 48,650 45,234 65,741 Drugs and Miscellaneous Retail 110,554 117,262 118,740 117,224 102,558 103,843 154,528 179,191 551,958 Agriculture and All Others 121,651 105,139 129,721 116,945 105,670 66,743 146,885 148,739 217,430 Manufacturers - 7,095 (3,818) - - - - - 12,293 Censored categories - - - - - - - - - Total 655,108$ 664,975$ 651,969$ 646,481$ 628,799$ 589,250$ 944,034$ 989,166$ 1,666,760$ Total Number of Payers N/A N/A N/A N/A N/A N/A N/A N/A N/A City direct sales tax rate 0.50%0.50%0.50%0.50%0.50%0.50%1.00%1.00%1.00% Data Source Illinois Department of Revenue Note: Blank categories have less than 4 taxpayers, therefore no data is shown to protect the confidentiality of individual taxpayers. Effective July 2003, a .5% home rule sales tax was imposed. Effective July 1 2019, an additional .5% home rule sales tax was imposed. The City of Lake Forest became a home rule community in November 2004. 192 154 City of Lake Forest Sales Tax Base and Number of Principal Payers Taxable Sales by Category - Municipal Sales Tax Last Ten Calendar Years 2012 2013 2014 2015 2016 2017 2018 2019*2020 2021 General Merchandise 24,726$ 19,656$ 14,010$ 14,930$ 11,412$ 10,496$ 10,069$ 8,964$ 5,204$ 2,465$ Food 585,517 593,446 673,803 591,893 564,049 550,591 535,167 528,469 615,073 594,801 Drinking and Eating Places 317,291 338,382 364,221 329,303 350,024 372,173 362,713 349,961 224,312 297,355 Apparel 128,633 136,270 136,582 151,212 147,576 145,141 134,201 146,455 115,423 182,571 Furniture & H.H. & Radio 75,071 77,642 78,988 73,061 65,571 56,848 59,046 66,569 62,239 111,580 Lumber, Building, Hardware 13,742 19,724 - - 15,076 16,479 19,267 21,891 27,245 30,893 Automobile and Filling Stations 146,865 241,339 178,178 133,684 139,764 141,260 131,243 575,290 134,743 170,053 Drugs and Miscellaneous Retail 400,096 433,159 430,482 414,407 431,966 399,115 381,239 393,920 391,545 879,413 Agriculture and All Others 274,807 285,401 255,189 295,974 271,061 246,697 166,637 222,162 170,645 248,950 Manufacturers - - 14,415 (5,107) - - - - - 13,645 Censored categories - - - - - - - - - - Total 1,966,748$ 2,145,019$ 2,145,868$ 1,999,357$ 1,996,499$ 1,938,800$ 1,799,582$ 2,313,681$ 1,746,430$ 2,531,724$ Total Number of Payers 647 637 637 673 687 687 604 578 510 2897 City direct sales tax rate 1.00%1.00%1.00%1.00%1.00%1.00%1.00%1.00%1.00%1.00% Data Source Illinois Department of Revenue Note: Blank categories have less than 4 taxpayers, therefore no data is shown to protect the confidentiality of individual taxpayers. The categories, Lumber, Bldg. and Hardware and General Merchandise became a censored status in the 2nd quarter of 2008. The category of Furniture & H.H. & Radio became a censored status in the 4th quarter of 2011 * A onetime estimated payment of $400,000 was received in November 2019 193 155 City of Lake Forest Direct and Overlapping Sales Tax Rates Last Ten Fiscal Years Fiscal Year City Direct Rate State Rate Metra Rate Special County Rate Total 2013 1.50%5.00%0.50%0.50%7.50% 2014 1.50%5.00%0.50%0.50%7.50% 2015 1.50%5.00%0.50%0.50%7.50% 2016 1.50%5.00%0.50%0.50%7.50% 2017 1.50%5.00%0.50%0.50%7.50% 2018 1.50%5.00%0.50%0.50%7.50% 2019 1.50%5.00%0.50%0.50%7.50% 2020 2.00%5.00%0.50%0.50%8.00% 2021 2.00%5.00%0.50%0.50%8.00% 2022 2.00%5.00%0.50%0.50%8.00% Data Source City records The City of Lake Forest became a home rule community in November 2004. The City increased the home rules sales tax by .5% July 1, 2019 194 156 City of Lake Forest Ratios of Outstanding Debt by Type Last Ten Fiscal Years Governmental Activities Business-Type Activities Ratio of Total Percentage Total Fiscal General Installment General Total Outstanding Debt of Outstanding Year Obligation Purchase Obligation Revenue Primary To Equalized Personal Debt Per Ended Bonds Contracts Bonds Bonds Government Assessed Valuation*Income*Capita* 2013 37,203,146$ -$ 21,060,000$ -$ 58,263,146$ 2.45%3.90%3,007.13$ 2014 35,852,197 - 19,245,000 - 55,097,197 2.44%3.69%2,843.73 2015 34,258,902 - 17,602,838 - 51,861,740 2.30%3.47%2,676.73 2016 42,510,566 - 15,679,654 - 58,190,220 2.52%3.90%3,003.37 2017 34,775,542 - 13,737,111 - 48,512,653 1.99%3.25%2,503.88 2018 33,460,538 - 21,111,864 - 54,572,402 2.15%3.65%2,816.64 2019 32,016,478 - 19,090,324 - 51,106,802 2.02%3.42%2,637.77 2020 30,340,954 - 16,863,419 - 47,204,373 1.92%3.16%2,436.35 2021 28,339,248 - 14,756,030 - 43,095,278 1.80%2.89%2,224.27 2022 26,227,244 - 12,701,765 - 38,929,009 1.63%2.61%2,009.24 Note: Details of the City's outstanding debt can be found in the notes to the financial statements. * See the Schedule of Demographic and Economic Statistics for equalized assessed valuation of property, population data and personal income. 195 157 City of Lake Forest Ratios of General Bonded Debt Outstanding Last Ten Fiscal Years Less Amounts Percentage of Estimated Fiscal General Available In Debt Actual Taxable Per Year Obligation Bonds Service Fund Total Value of Property*Capita 2013 58,263,146$ 1,908,750$ 55,855,871$ 0.78%2,882.88$ 2014 55,097,197 1,144,118 53,953,079 0.80%2,784.68 2015 51,861,740 1,316,900 50,544,840 0.75%2,608.77 2016 58,190,220 1,201,300 56,988,920 0.82%2,941.36 2017 48,512,653 1,067,027 47,073,830 0.64%2,429.62 2018 54,572,402 1,161,697 53,410,705 0.70%2,756.68 2019 51,106,802 1,292,816 49,813,986 0.66%2,571.04 2020 47,204,373 1,596,241 45,608,132 0.61%2,353.97 2021 43,095,278 1,640,674 41,454,604 0.57%2,139.59 2022 38,929,009 1,289,569 37,639,440 0.52%1,942.68 Note: Details of the City's outstanding debt can be found in the notes to the financial statements. * See the Schedule of Assessed Value and estimated Actual Value of Taxable Property for property value data. 196 158 City of Lake Forest Direct and Overlapping Governmental Activities Debt April 30, 2022 Percentage City of Debt Applicable Lake Forest Gross to the City of Share Governmental Unit Debt Lake Forest*of Debt Lake County 137,310,000$ 9.94%13,648,614$ Lake County Community College #532 90,210,000 10.48%9,454,008 Lake County Forest Preserve District 181,865,000 9.94%18,077,381 School District #67 3,040,000 100.00%3,040,000 School District #103 6,595,000 0.01%679 High School District #115 17,415,000 79.50%13,844,925 Subtotal, overlapping debt 436,435,000 58,065,607 City of Lake Forest direct debt 26,227,244 100.00%26,227,244 Total direct and overlapping debt 462,662,244$ 84,292,851$ Source: Lake County Clerk District Bond Principal Payments Report * Determined by ratio of assessed valuation of property subject to taxation in the City of Lake Forest to valuation of property subject to taxation in overlapping unit. The Percentage of debt is calculated by the percentage of the City's EAV in relation to the overlapping government's EAV. The gross debt is found on the Lake County website. Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the City of Lake Forest. This process recognizes that, when considering the government's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government. 197 159 City of Lake Forest Legal Debt Margin Information Last Ten Fiscal Years 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Debt limit N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Total net debt applicable to limit N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Legal debt margin N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Total net debt applicable to the limit as a percentage of debt limit N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Note: Legal debt margin from 1997-2004 was 8.625% of assessed value. * City of Lake Forest achieved home rule status in November 2004. To date the General Assembly has set no limits for home rule municipalities. 198 160 City of Lake Forest Last Ten Fiscal Years Fiscal Gross Less: Operating Net Available Debt Service Year Revenue Expenses Revenue Principal Interest Coverage 2013 9,956,387$ 6,938,272$ 3,018,115$ 1,744,000$ 482,866$ 1.36 2014 9,043,227 5,406,022 3,637,205 1,815,000 433,125 1.62 2015 8,918,081 5,445,461 3,472,620 1,847,000 402,951 1.54 2016 10,190,948 5,826,164 4,364,784 1,877,000 373,266 1.94 2017 9,881,831 6,438,798 3,443,033 1,902,000 339,386 1.54 2018 10,022,069 5,644,942 4,377,127 1,952,000 544,461 1.75 2019 10,357,788 6,992,668 3,365,120 1,987,000 580,023 1.31 2020 9,655,908 6,253,668 3,402,240 2,067,000 530,673 1.31 2021 10,796,575 6,752,827 4,043,748 1,934,413 607,064 1.59 2022 12,543,737 5,821,671 6,722,067 1,871,947 523,002 2.81 Note: Details of the City's outstanding debt can be found in the notes to the financial statements. Water Charges and Other includes investment earnings but excludes sale of property and grants Operating expenses does not include debt service, depreciation or reserve requirements Waterworks and Sewerage and Golf Course Bonds Pledged Revenue Coverage 199 161 City of Lake Forest Demographic and Economic Information Last Ten Fiscal Years Fiscal Equalized Accessed Per Capita Personal Per Capita Unemployment Year Population Valuation (EAV)EAV Income Personal Income Rate 2013 *19,375 (A)2,378,047,139$ 122,738$ 1,493,657,500$ 77,092$ 6.9% 2014 *19,375 (A)2,253,547,404 116,312 1,493,657,500 77,092 6.7% 2015 *19,375 (A)2,250,468,636 116,153 1,493,657,500 77,092 5.5% 2016 *19,375 (A)2,307,936,059 119,119 1,493,657,500 77,092 4.7% 2017 *19,375 (A)2,443,072,671 126,094 1,493,657,500 77,092 4.6% 2018 *19,375 (A)2,533,957,443 130,785 1,493,657,500 77,092 4.0% 2019 *19,375 (A)2,526,924,079 130,422 1,493,657,500 77,092 3.9% 2020 *19,375 (A)2,457,796,598 126,854 1,493,657,500 77,092 3.4% 2021 *19,375 (A)2,396,662,125 123,699 1,493,657,500 77,092 6.4% 2022 *19,375 (A)2,381,873,010 122,935 1,493,657,500 77,092 3.8% (A) Actual (E) Estimate by City of Lake Forest Data Source City records, Department of Labor and Office of the County Clerk. * The State of Illinois revised the annual unemployment rates for small communities back to 2010 in 2014 Census information for 2022 was not available from the City as of issuance date 200 162 City of Lake Forest Principal Employers Current Year and Nine Years Ago % of Total % of Total Employer Employees Rank City Population Employees Rank City Population Northwestern Medicine Lake Forest Hospital 1,545 1 7.97%1,600 1 8.26% Abbott 1,136 2 5.86% Hospira Inc.921 3 4.75%1,350 2 6.97% Pfizer ** Trustmark Insurance Company 498 4 2.57%800 3 4.13% Pactiv Corporation 492 5 2.54%300 7 1.55% Solo Cup Co.600 4 3.10% Lake Forest College excludes student employees 438 6 2.26%500 5 2.58% Lake Forest H.S. District 115 teacher, support staff 321 7 1.66%350 6 1.81% Lake Forest Elem. S.D. No. 67 304 8 1.57% Packaging Corporation of America 298 9 1.54%200 10 1.03% City of Lake Forest 210 10 1.08%275 8 1.42% Brunswick Corporation Packaging Corp - 200 9 1.03% 11977 6240 Data Source City staff contacted companies via mail. ** No response received 2022 2013 201 163 City of Lake Forest Full-Time Equivalent Employees Last Ten Fiscal Years Full-Time-Equivalent Budgeted Employees as of April 30 Function/Program 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 General Government Administration 25 25 25 25.0 25.4 23.5 23.8 23.75 24.75 24.75 Community Development 13.0 13.0 13.0 13.0 13.0 13.0 13.0 13.0 13.0 13.0 Public Safety Fire Protection Firefighters 33 33 33 33 33 32 32 32 32 32 Administrative 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 Police Officers 40 40 40 40 40 40 40 40 40 40 Civilians 18.0 18.0 18.0 8.0 9.0 7.0 7.0 7.0 7.0 7.0 Public Works Public Works Administration 4 4 4 4 4 4 4 4 4 4 Building Maintenance 6 7 7 7 7 7 7 7 7 7 Engineering 5 5 5 5 5 5 5 5 5 5 Streets 8 8 7.5 7.5 8.0 8.0 8.0 8.0 8.0 8.0 Sanitation 12 11 10.5 10.5 10.0 10.0 10.0 10.0 10.0 10.0 Forestry 0 0 0 0 0 0 0 0 0 0 Fleet (vehicle) Maintenance 6 6 6 6 6 6 6 6 6 6 Water Water Plant 7 7 7 6.5 6.5 6.5 6.5 6.5 6.5 6.5 Water and Sewer 10 9 9 8.5 8.5 8.5 8.5 8.5 8.5 8.5 Parks 15.4 15.4 15.4 15.4 15.0 15.0 15.0 15.0 15.0 15.0 Recreation 15.4 15.4 15.4 15.4 16.0 16.0 16.0 16.0 16.0 16.0 Golf Course 2.2 2.2 2.2 2.2 0.0 0.0 0.0 0.0 0.0 0.0 Cemetery 2 2 2 2 2 3 3 3 3 3 Senior Resources 3 3 3 3 3 3 3 3 3 3 Sub - total City 226 224 224 214 213.4 209.5 209.75 209.75 210.75 210.75 Library 27.8 28.2 28.2 29.2 30.5 30.5 31.0 30.0 31.0 30.0 Total all 253.8 252.2 252.2 243.2 243.9 240 240.75 239.75 241.75 240.75 Data Source City Departments and employee totals as of April 30th 202 164 City of Lake Forest Operating Indicators Last Ten Fiscal Years Function/Program 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 General Government City Clerk Real Estate Transfer Tax (1) Number of Transactions 382 440 394 355 361 425 418 369 663 637 Rebates Issued 40 67 40 44 37 40 45 33 63 67 Birth Certificates Issued 2,675 2,250 2,556 2,575 2,474 2,807 2,759 2,525 2,617 3,212 Passports Issued (2)0 0 0 0 0 0 0 0 0 0 Community Development Building permits issued 3,197 3,418 3,667 3,855 3,632 3,753 4,275 3,716 3,847 4,446 Residential construction 7 13 20 27 21 9 13 18 29 32 Commercial construction 2 1 1 1 1 4 - 1 2 2 Building inspections conducted 8,925 8,651 9,657 11,009 11,707 10,798 11,214 10,586 10,466 10,065 Public Safety Fire protection I.S.O. rating 4 4 4 4 3 3 3 3 3 3 Number of calls answered EMS 1,726 1,574 1,785 1,712 1,923 1,909 1,839 2,232 1,868 2,159 Fire 1,403 1,497 1,503 1,367 1,385 1,448 1,450 1,448 1,127 1,403 Police (calendar year) Non traffic arrests 237 191 89 166 129 76 157 83 80 95 Parking violations 7,013 5,979 5,250 3,907 5,396 4,325 6,891 3,748 1,107 2,242 Traffic violations 2,220 1,877 1,741 1,985 1,718 949 1,909 1,583 1,487 1,336 Public Works Streets Street resurfacing (miles) (calendar year)5.92 5.00 5.50 2.40 3.28 2.63 2.20 3.40 1.90 1.20 Number of snow events Salting 23 27 21 24 15 10 9 6 5 5 Plowing 12 21 20 10 5 10 9 10 14 13 Inches of snow 36 48 50 24 22 45 46 26 63 37 Sanitation Refuse collection customers 6,472 6,462 6,654 6,295 6,467 6,467 6,484 6,503 6,527 6,550 Parks and Recreation (3) Fitness Number of programs 264 336 181 346 215 200 257 246 682 70 Units of participation 1,060 1,587 1,216 1,271 1,473 1,430 1,446 1,442 2,079 1,502 Athletics Number of programs 283 270 341 168 275 237 466 460 792 213 Units of Participation 2,704 2,524 2,282 1,348 2,006 2,026 1,931 1,958 561 1,901 Lakefront, Early Childhood Education and Lifetime Activities Number of programs 319 294 126 130 176 161 228 223 298 124 Units of participation 1,576 1,380 752 1,393 1,221 1,385 1,679 1,685 443 1,233 Cultural Arts/Special Events Number of programs 306 286 87 147 286 246 310 312 550 259 Units of participation 1,972 1,999 1,329 1,579 4,133 4,743 5,064 5,078 1,698 5,269 203 165 City of Lake Forest Operating Indicators (Continued) Last Ten Fiscal Years Function/Program 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Wildlife Discovery Center, Ridge Teams Course and Adventure Number of programs 37 47 20 20 26 34 31 33 24 23 Units of participation 301 360 2,263 2,802 3,685 2,148 2,233 2,224 98 698 Developed parks and recreation areas 10 10 10 11 11 11 10 11 11 11 Developed park acreage 404 404 404 405 405 405 344 344 344 344 Sites with playgrounds 9 9 9 9 9 9 9 9 9 9 Sites with baseball diamonds 8 8 8 8 8 8 8 7 7 7 Sites with soccer fields 7 7 7 7 7 7 7 7 7 7 Sites with basketball standards 5 5 5 5 5 5 5 4 4 4 Sites with tennis courts 6 6 6 6 6 6 6 6 6 6 Deer Path Golf Course Size 18 holes 18 holes 18 holes 18 holes 18 holes 18 holes 18 holes 18 holes 18 holes 18 holes Rounds of Play 30,321 29,435 27,956 29,445 27,101 24,631 26,184 24,666 24,508 26,293 Daily fee 13,646 17,449 17,646 20,478 19,755 18,660 21,172 20,089 20,380 22,112 Seasonal 16,675 11,986 10,310 8,967 7,346 5,971 5,012 4,577 4,128 4,181 Water New Connections (tap-ons)20 28 33 66 30 23 29 21 27 15 Meters in operation 6,754 6,751 6,764 6,810 6,854 6,854 6,840 6,850 6,899 6,911 Meters connected to sewerage system 6,584 6,587 6,577 6,645 6,718 6,778 6,766 6,789 6,832 6,842 Average daily consumption (MGD)4.202 3.652 3.250 3.162 3.499 3.550 3.430 3.132 3.400 3.802 Peak daily consumption (MGD)10.298 8.611 7.345 8.268 8.315 8.926 7.247 7.916 8.180 9.216 Rated daily pumping capacity (MGD)14 14 14 14 14 14 14 14 14 14 Total gallons pumped during fiscal year (in millions)1,534.0 1,332.8 1,187.6 1,157.2 1,277.0 1,296.0 1,252.0 1,146.4 1,241.0 1,387.8 Municipal paid parking facilities Long- term parking spaces Miscellaneous lots 813 813 813 813 813 813 813 813 813 813 Union Pacific (CBD district)98 98 98 98 98 98 98 98 98 98 Metra (Telegraph Road)502 502 502 502 502 502 502 502 502 502 Short-term parking spaces 341 341 341 341 341 341 341 341 341 341 Component Unit Library services Books and non print materials 147,330 148,318 146,214 146,153 221,568 248,598 147,024 149,026 350,692 366,063 Registered borrowers 15,160 15,403 15,440 15,460 15,518 13,588 13,946 7,908 9,408 9,377 Fiscal yearbooks, items or materials circulation 457,632 450,876 410,852 383,561 376,144 551,232 366,128 346,603 262,366 350,541 Data Source City departments (1) Collection of real estate transfer tax began in July 2006 (FY2007). (2) The City began to issue passports in FY2003 and stopped in FY2012. (3) a. Fitness data does not include Fitness Center memberships. b. Units of participation may include an individual participant more than once. N/A equals data not available 204 166 City of Lake Forest Capital Asset Statistics Last Ten Fiscal Years Function/Program 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Public Safety Police Stations 1 1 1 1 1 1 1 1 1 1 Vehicles 25 23 23 21 24 24 23 23 23 23 Fire protection Stations 2 2 2 2 2 2 2 2 2 2 Vehicles 14 17 15 17 17 15 18 18 19 23 Public Works Bridges Vehicle 14 14 14 14 14 14 14 14 14 14 Pedestrian 12 12 12 12 12 12 13 13 13 13 Streets Streets (centerline miles)119.00 119.24 119.24 119.24 119.24 119.24 119.24 119.24 119.24 119.24 Streetlights Gas 438 438 438 438 438 438 438 438 438 438 Electric 1,526 1,536 1,570 1,570 1,570 1,570 1,570 1,570 1,570 1,570 Storm sewer (miles)219.41 219.41 219.41 219.43 219.43 219.46 219.54 219.54 219.54 219.54 Parks and Recreation Acreage 404 404 404 405 405 405 344 344 344 344 Water Water mains (miles)165.25 165.79 166.44 166.44 166.89 167.68 167.68 167.73 167.84 167.84 Fire hydrants 1,362 1,362 1,511 1,511 1,511 1,519 1,374 1,400 1,400 1,400 Wastewater Sanitary sewers (miles)138.90 138.95 138.95 139.43 139.43 140.25 140.25 140.25 140.25 140.25 Data Source City departments N/A = data not available 205 The City of Lake ForestCITY COUNCIL MEETINGProceedings of the Monday, October 17, 2022City Council Meeting - City Council Chambers220 E Deerpath, Lake Forest, IL 60045CALL TO ORDER AND ROLL CALL Mayor Pandaleon called the meeting to order at 7:25p.m, and Deputy CityClerk Joyce Reda called the roll of Council members.Present: Alderman Morris, Alderman Novit, Alderman Rummel, Alderman Preschlack, Alderman Goshgarian,Alderman Buschmann, and Weber.Absent: Alderman NotzCALL TO ORDER AND ROLL CALLPLEDGE OF ALLEGIANCE was recited.REPORTS OF CITY OFFICERSCOMMENTS BY MAYORA. ICMA Community Sustainability Program Excellence Award-Dan Martin, Superintendent of Public Works and Dana Olson,Communications ManagerMayor Pandaleon recognized the Community Sustainability Excellence award given to the City from theInternational City/County Manager's Association (ICMA) for the Rethink Recycling Campaign. MayorPandaleon acknowledged the importance of financial support from the Lake Forest Garden Club throughgenerous donations. Photos were taken with those engaged in the project and Public Works SuperintendentDan Martin provided the Council with an overview of the project.COMMENTS BY CITY MANAGEROPPORTUNITY FOR CITIZENS TO ADDRESS THE CITY COUNCILCOMMITTEE REPORTSITEMS FOR OMNIBUS VOTE CONSIDERATION1. Approval of October 3, 2022, City Council Meeting Minutes2. Acknowledgement of Receipt of the fiscal year 2022 Treasurer's Report206 Proceedings of the Monday, October 1 7, 2022City Council Meeting3. Award of Contract with Advanced Tree Care for an amount not to exceed $52,000 to extendMPI Tree Pruning services for tree pruning in fiscal year 2023.4. Approval to purchase nine 420-dass Sailboats from Simmons Boatworks in amount not toexceed $60,000.5. Consideration of Ordinances Approving Recommendations from the Building Review Board(First Reading, and if Desired by the City Council, Final Approval).6. Consideration of Ordinances Approving Recommendations from the Zoning Board of Appeals(First Reading, and if Desired by the City Council, Final Approval).COUNCIL ACTION: Approval of the six (6) omnibus items as presented.Mayor Pandaleon asked members of the Council if they would like to remove any item or take it separately.Seeing none, he asked for a motion.Alderman Morris a motion to approve the six (6) Omnibus items as presented, seconded by AldermanPreschlack. The following voted "Aye": Alderman Morris, Novit, Rummel, Preschlack, Goshgarian, Buschmannand Weber. The following voted "Nay": None. 7-Ayes, 0 Nays, motion carriedInformation such as Purpose and Action Requested, Background/Discussion, Budget/Fiscal Impact,Recommended Action and a Staff Contact as it relates to the Omnibus items can be found on the agenda.ORDINANCESOLD BUSINESS1. Consideration of a Settlement Agreement in the matter of 361 Westminster, LLC and the 705 NorthMcKinley Development, LLC v. City of Lake Forest and Various Other Parties. (Approval by motion).Mayor Pandaleon stated it is time for the City Council to take a leadership role by approving the settlementagreement. Mayor Pandaleon introduced Kurt Ashprooth, City Attorney, who stated the litigation will bestayed until December 5, to allow the city to hear the revised plan at the Planning and HPC Commission.The City Council had lengthy discussion with City staff in regards to the specifics on the cash lieu of affordablehousing in accordance with City code.Mayor Pandaleon asked if anyone from the public would like to make a comment. The following persons madecomments:Susan Athenson, President of the Lake Forest Preservation Foundation offered her opinion to the City Councilin opposition of the settlement agreement, noting drawbacks in compromise.JeffTorosian offered opinion to the City Council in opposition of the settlement agreement, noting drawbacksin compromise.Rommy Lopat offered her opinion to the City Council in opposition of the settlement agreement, notingdrawbacks in compromise.207 Proceedings of the Monday, October 17, 2022City Council MeetingTodd Curry offered his opinion to the City Council in support of the settlement agreement, noting possibleimprovements in public notification and to not bypass the Planning and HPC Committees.Art Miller offered his opinion to the City Council in opposition of the settlement agreement, notinggeographical challenges that could arise.Sally Downey offered her opinion to the City Council in opposition of the settlement agreement, noting anemphasis on development through city code and guidelines.Reed Dailey offered his opinion to the City Council in opposition of the settlement agreement, notinginconveniences to surrounding properties.Mayor Pandaleon asked City Council members for final comment.COUNCIL ACTION: If desired by the Council, approve the Settlement Agreement as presented in the Councilpacket by Motion.Alderman Goshgarian made a motion to approve the Settlement Agreement as presented in the Councilpacket by motion, seconded by Alderman Rummel. The following voted "Aye": Alderman Morris, Novit,Rummel, Preschlack, Goshgarian, and Weber. Thefollowing voted "Nay": Alderman Buschmann. 6-Ayes, 1Nays, motion carried.2. Approval of Amendment to the Contract for Architecture and Engineering Services for SyntheticTurf Field at Deerpath Community Park with Hitchcock Design Group, to Include Additional DesignServices in the Amount of $85,200Chuck Myers, Superintendent of Parks & Forestry, gave an overview of the amendment to the contract forarchitecture and engineering services, outlining an updated plan on size and cost. The City Council haddiscussion on the additional building and boardwalk that is included in the funding proposed.City Manager Jason Wicha proposed that the storage facility, or additional building, is critical for the project inorder to adequately maintain the fields.COUNCIL ACTION: Approval of an Amendment to the Contract for Architecture and Engineering Services forNew Synthetic Turf Field at Deerpath Community Park with Hitchcock Design Group, to Include AdditionalDesign Services in the Amount of $85,200.Alderman Novit made a motion of Approval of an Amendment to the Contract for Architecture andEngineering Services for New Synthetic Turf Field at Deerpath Community Park with Hitchcock Design Group,to Include Additional Design Services in the Amount of $85,200, seconded by Alderman Weber. The followingvoted "Aye": Alderman Morris, Novit, Rummel, Preschlack, Goshgarian, Buschmann and Weber. Thefollowing voted "Nay": None. 7-Ayes, 0 Nays, motion carried.NEW BUSINESSADDITIONAL ITEMS FOR COUNCIL DISCUSSION/COMMENTS BY COUNCIL MEMBERSADJOURNMENT208 Proceedings of the Monday, October 1 7, 2022City Council MeetingThere being no further business Mayor Pandaleon asked for a motion. Alderman Rummel made a motion toadjourn, seconded by Alderman Buschmann. Motion carried unanimously by voice vote at 9:28 p.m.Respectfully Submitted,Joyce Reda, Deputy City Clerk-4 video of the City Council meeting is available for viewing at the Lake Forest Library and on file in the Clerk'soffice at City Hall. You can also view it on the website by visiting www.cit o lake orest.com. Click on I Want To,then click on View, then choose Archived Meetings Videos.209 For City Council Consideration 11.7.2022 AMENDED AND RESTATED EMPLOYMENT AGREEMENT THIS AGREEMENT is made and entered into this ____ day of ________, 2022, by and between the THE CITY OF LAKE FOREST, an Illinois home rule municipality ("City") and JASON C. WICHA ("Employee"). WHEREAS, in 2018, the City entered into an employment agreement with Employee to set forth the terms, provisions, and conditions of the employment of Employee as the City Manager; and WHEREAS, the City desires to continue the Employee’s services as the City Manager under the terms, provisions, and conditions set forth in this Agreement; and WHEREAS, Employee desires to continue employment with the City under the terms, provisions, and conditions set forth in this Agreement; NOW, THEREFORE, in consideration of the recitals set forth above, the promises and agreements in this Agreement, and other valuable consideration, the parties agree as follows: Section 1. Employment and Duties. The City agrees to employ Employee as City Manager, and Employee agrees to continue employment as City Manager. Employee agrees to perform all duties of the City Manager as set forth in the City Charter, the City Code, and Illinois statute, as well as other duties that may be assigned to Employee by the Mayor and City Council from time-to-time. Section 2. Term. Employee will serve as City Manager for an indefinite term at the pleasure of the Mayor and City Council. Nothing in this Agreement will prevent, limit, or otherwise interfere with the right of the Mayor and City Council to terminate the employment of the Employee at any time, with or without cause, subject only to the provisions of this Agreement. Moreover, nothing in this Agreement will prevent, limit, or otherwise interfere with the right of the Employee to resign at any time from his position as City Manager, subject only to the provisions of this Agreement. Section 3. Termination and Severance Pay. A. Termination without Cause. The City may terminate this Agreement and remove Employee, without cause, subject to payment of severance as provided by this Subsection 3.A. Termination without cause is defined as termination of Employee’s employment for any reason other than as defined in Subsection 3.B below. If Employee is terminated by the Mayor and City Council without cause, Employee will be entitled to a lump sum cash payment equal to six months’ base salary. The City will continue to provide health insurance benefits as provided for in this Agreement for six months or until Employee obtains health insurance coverage elsewhere, whichever is less. In exchange for the severance payment, Employee agrees to execute all waivers and releases that the City customarily requires of employees upon separation of employment with the City, including waivers and releases of specific statutory rights after required waiting periods. 210 2 B. Termination with Cause. The City may terminate this Agreement and remove Employee with just cause. If Employee is terminated by the Mayor and City Council for just cause, Employee will not be entitled to any severance payment. Termination with just cause is defined as termination of Employee’s employment for conviction of any felony, conviction of any crime involving moral turpitude damaging the integrity of the City, or official misconduct as defined by Illinois statutes. C. Resignation. If Employee voluntarily resigns from his position as City Manager, Employee must give the City a minimum of three months advance notice in writing, unless otherwise modified by the Mayor and City Council. D. Disability. If Employee becomes disabled or is otherwise unable to perform his duties with reasonable accommodation because of sickness, accident, injury, mental incapacity, or health for a period of four successive weeks or for 20 working days over a 30 working day period, following exhaustion of any accrued sick leave, the City has the option to terminate this Agreement unless otherwise prohibited by applicable law, subject to termination and severance requirements. E. Payout of Accrued Leave. Upon any termination of Employee under this Section 3, Employee will be entitled to compensation for any accrued but unused vacation or other leave time in the manner required by law and as set forth in the City’s then-applicable Personnel Policies and Procedures. Section 4. Compensation and Benefits. A. Base Salary. The City agrees to pay Employee a base salary of Two Hundred and Twenty-Five Thousand Dollars ($225,000.00), payable in installments in accordance with the City’s normal payroll practices, effective as of May 1, 2022. The base salary may be adjusted from time-to-time as the Mayor and City Council, in their sole discretion, may determine without having to amend this Agreement. B. Bonus. The City reserves the right to recognize and reward successful performance and may, at the time of evaluation or at any other time, and in the City’s sole discretion, pay Employee such additional bonus compensation as the City deems appropriate. C. Deferred Compensation. The City agrees to execute all necessary documents for the Employee’s participation in an ICMA-RC 457 deferred compensation plan or the Voluntary Additional Contribution deferred compensation plan administered by the Illinois Municipal Retirement Fund (“Deferred Compensation Plan”). The City agrees to pay an amount equal to 8.75% of the Employee’s base salary into the Deferred Compensation Plan on Employee’s behalf, in equal proportionate amounts each pay period. D. Health Insurance Benefits. Employee is eligible and entitled to participate in the City’s medical and dental insurance program on the same terms applicable to other City management employees from time-to-time. 211 3 E. Life Insurance Benefits. Employee will receive the same life insurance benefits received by all City management employees from time-to-time. F. IMRF. Employee will be eligible to enroll in the Illinois Municipal Retirement Fund (“IMRF”) pursuant to its terms and provisions, and the City will make the employer’s contribution. G. Professional Development. In order to maintain Employee’s professional standing and continued education, the City agrees to pay the reasonable cost of Employee's dues in professional associations and other reasonable expenses of professional development, and attendance at state and national city management conferences. Section 5. Vacation, Sick Leave, Holidays, and Personal Days. A. Vacation. On Employee’s start date, Employee will receive 40 hours of vacation leave. For the remainder of Employee’s first calendar year of employment, Employee will receive 6.15 hours of vacation leave per pay period. In the second and subsequent years, Employee will receive 6.46 hours of vacation leave per pay period, equivalent to four weeks per year. B. Sick Leave. On Employee’s start date, Employee will receive 40 hours of sick leave. Thereafter, Employee will be eligible for the same sick leave benefits received by City management employees from time-to-time, up to 96 hours per year. C. Holidays and Personal Days. The Employee will receive the same holidays and personal days each calendar year as received by City management employees from time-to-time. D. Policies on Use and Accrual of Leave. Employee’s use and accrual of vacation leave, sick leave, holidays, and personal days will be subject to the rules and policies contained in the then-applicable City’s Personnel Policies and Practices. Section 6. Relocation and Residency. A. Residency. The City and Employee agree that residency in the City is a condition of employment under this Agreement. B. Lake Forest Residence Loan. 1. In recognition of the expenses involved in residing in Lake Forest, the City agreed to provide a loan (“Loan”) to Employee in the amount of $200,000.00 for a portion of the purchase price of a residence purchased by Employee in Lake Forest (“Lake Forest Residence”). The Loan will be without interest. The City paid this sum as directed by Employee on the date of closing of the Lake Forest Residence. The Loan is evidenced by a promissory note (“Note”), which Note was made by the Employee and any co-owner of the Lake Forest Residence. 212 4 2. The Loan is due and payable upon the earlier of (a) the date of closing of the sale or other transfer by Employee and/or a co-owner of any of their interest in the Lake Forest Residence or (b) the date that is nine months after the termination of the Employee’s employment as City Manager under this Agreement, whether voluntary or involuntary, with or without cause or (c) 25 years from the effective date of the Note. 3. The provisions of this Subsection 6.B will survive the termination of this Agreement. 4. In recognition of the value of the Employee’s continued service to the City as the City Manager, the City agrees that the blance of its Housing Loan to the Employee shall be reduced on each anniversary of this Agreement as follows: 5/1/2020 - $185,000 5/1/2021 - $170,000 5/1/2022 - $155,000 5/1/2023 - $140,000 5/1/2024 - $125,000 5/1/2025 - $110,000 5/1/2026 - $95,000 5/1/2027 - $80,000 5/1/2028 - $65,000 5/1/2029 - $50,000 5/1/2030 - $35,000 5/1/2031 - $20,000 5/1/2032 - $0 Employee will only realize the reduction in the Housing Loan set forth in the preceding table if the Employee is serving as the City Manager on any particular adjustment date. Unless otherwise approved by the City Council, no proration of the adjustment oin the Housing Loan will be awarded to the Employee. Section 7. Performance Evaluation. The Mayor and City Council will review and evaluate the performance of the Employee at least once annually. At a minimum, the performance evaluation process will include a written evaluation of the work performance during the previous rating period, a review of Employee’s goals and performance objectives for the next rating period, and a written summary of the evaluation results. Section 8. Exclusive Employment. Employee’s position as City Manager will be his sole employment. Section 9. Other Terms and Conditions of Employment. All provisions of the City Charter, the City Code, the City’s Personnel Policies and Practices, and other rules or policies of the City as they now exist or may be amended from time-to-time will also apply to the Employee as they would to other employees of the City, except as expressly set forth in this Agreement. 213 5 Section 10. Indemnification. The City agrees to defend, save harmless and indemnify Employee against any tort, professional liability claim, or demand or other legal action arising out of an alleged act or omission occurring in the performance of Employee’s duties as City Manager. The City will have the right to compromise and settle any such claim or suit and thereupon pay the amount of any settlement or judgment rendered thereon. Section 11. Attorney Review. Employee acknowledges that he has been informed by the City, through the terms of this Agreement, that he was advised to review and discuss the terms of this Agreement with an attorney of his choice prior to signing this Agreement. Section 12. General Provisions. This Agreement constitutes the entire Agreement between the parties and it will be binding upon and inure to the benefits of the heirs, executors, successors and assigns of the parties. This Agreement may only be amended by written instrument executed by both parties, and each provision of this Agreement will be deemed severable. Neither party may assign their rights or obligations under this Agreement without the express written consent of the other party. This agreement supersedes all prior agreements between the parties regarding the matters herein set forth. This Agreement will be construed under the laws of the State of Illinois. Section 13. Notices. Any notice required under this Agreement will be deemed given when deposited in the U.S. mail to the following: City: Mayor City Hall, The City of Lake Forest 220 E Deerpath Rd Lake Forest, Illinois 60045 Employee: Jason C. Wicha 220 E. Deerpath Lake Forest, IL 60045 IN WITNESS WHEREOF, the parties have executed this Agreement the day and year first above written. THE CITY OF LAKE FOREST, a home rule municipality ATTEST: By ________________________________ Mayor ________________________________ City Clerk JASON C. WICHA 214 215 November 1, 2022 Mayor Pandaleon The City of Lake Forest 220 E. Deerpath Rd. Lake Forest, IL 60045 Dear Mayor Pandaleon, Lake Forest College Athletics is asking for the City Council’s consideration of a waiver for the requirement of the fidelity bond, with regards to our Lake Forest College Athletics Cash Raffle license application. The raffle includes cash winnings of $5,000 and we anticipate the number of tickets to be sold at 4,000. Thank you for your consideration. Sincerely, Chris Pier Chris Pier Associate Athletic Director – Budget & Compliance 216 217 218 219 220 221 222 223 224 225