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CITY COUNCIL 11/06/2023THE CITY OF LAKE FOREST CITY COUNCIL AGENDA Monday, November 6, 2023, 6:30 p.m. 220 E. Deerpath Lake Forest, IL 60045 CALL TO ORDER AND ROLL CALL 6:30 p.m. Honorable Mayor, Stanford R. Tack Nancy Novit, Alderman First Ward Jim Preschlack, Alderman Third Ward Joseph R. Waldeck, Alderman First Ward Ara Goshgarian, Alderman Third Ward Edward U. Notz, Jr., Alderman Second Ward Eileen Looby Weber, Alderman Fourth Ward John Powers, Alderman Second Ward Richard Walther, Alderman Fourth Ward PLEDGE OF ALLEGIANCE REPORTS OF CITY OFFICERS 1.COMMENTS BY MAYOR A.Consideration of Approval of a Donation and Naming Rights Agreement in Relation to the Forest Park Beach Pathway Project A copy of the Donation and Naming Rights Agreement can be found on page 17. COUNCIL ACTION: Approval of the Agreement B.Police Department Promotions -Swear in Police Commander Tim Gretz -Swear in Police Commander Conrad Christensen -Swear in Police Commander Ben Grum C.Resolution of Appreciation for retiring employee Mike Whalen A copy of the resolution can be found beginning on page 23 COUNCIL ACTION: Approve a Resolution of Appreciation for retiring employee Mike Whalen 2.COMMENTS BY CITY MANAGER A.Community Spotlight -Reading Power, Lisa Bulzoni, CEO 1 Monday, November 6, 2023, City Council Agenda 3. OPPORTUNITY FOR CITIZENS TO ADDRESS THE CITY COUNCIL 4. COMMITTEE REPORTS AUDIT COMMITTEE REPORT 1. Audit Committee Report and Presentation of the Fiscal Year 2023 Annual Comprehensive Financial Report PRESENTED BY: Tighe Magnuson, Audit Committee Member 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, 2023. BACKGROUND/DISCUSSION: The Annual Comprehensive Financial Report for the fiscal year ended April 30, 2023 is provided beginning on page 25. 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 2023 financial statements. The City has been awarded the Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association (GFOA) for forty-four (44) 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 2023 and highlights of those meetings as well as the audit report will be presented this evening by Audit Committee Member Tighe Magnuson. COUNCIL ACTION: Receipt of the audit report for the fiscal year ended April 30, 2023. 5. ITEMS FOR OMNIBUS VOTE CONSIDERATION 1. Approval of October 16, 2023, City Council Meeting Minutes A copy of the minutes can be found beginning on page 213. COUNCIL ACTION: Approval of October 16, 2023, City Council Meeting Minutes 2. Approval of the Check Register for the Period of September 23 to October 27, 2023 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 2 Monday, November 6, 2023, City Council Agenda 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 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: The amount denoted as “All other Funds” includes $447,054 in Water Capital Fund expenses and $708,430 in Medical/Dental Plan expenses. COUNCIL ACTION: Approval of the Check Register for the Period of September 23 to October 27, 2023 Fund Invoice Payroll Total 101 General 847,887 2,493,701 3,341,588 501 Water & Sewer 164,835 287,249 452,084 220 Parks & Recreation 187,134 654,372 841,506 311 Capital Improvements 2,921,497 2,921,497 202 Motor Fuel Tax 36,812 36,812 230 Cemetery 16,512 68,979 85,492 210 Senior Resources 14,961 42,650 57,611 510 Deerpath Golf Course 35,101 3,745 38,845 601 Fleet 166,347 96,030 262,377 416 - 434 Debt Funds 0 248 Housing Trust 0 201 Park & Public Land 0 All other Funds 1,553,902 278,111 1,832,013 $5,944,988 $3,924,836 $9,869,824 Check Register for September 23- October 27, 2023 3 Monday, November 6, 2023, City Council Agenda 3. Consideration of Requests to Waive the Fidelity Bond Requirement in Connection with Holding a Raffle in the City of Lake Forest for The Church of St. Mary, School of St. Mary 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 requirements in connection with a proposed raffle from The Church of St. Mary, School of St. Mary 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, The Church of St. Mary, School of St. Mary and Lake Forest College Athletics are requesting a waiver of the bond requirements and have submitted requests. A copy of the requests can be found beginning on page 217 BUDGET/FISCAL IMPACT: N/A COUNCIL ACTION: Consideration of Requests to Waive the Fidelity Bond Requirement in Connection with Holding a Raffle in the City of Lake Forest for The Church of St. Mary, School of St. Mary and Lake Forest College Athletics. (Approval by Motion) 4. Determination of a Non-Binding Estimate of the Amount of Revenue to be Generated from Property Taxes for the 2023 Calendar Year and Establishment of December 4, 2023 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 2023 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 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 2023 tax levy by establishing an estimated amount from which staff can prepare a proposed levy ordinance. The 2023 property tax levy estimate, as considered by the Finance Committee on October 16, is as follows: 4 Monday, November 6, 2023, City Council Agenda Levy 2022 Extended 2023 Levy Estimate % Increase (Decr.) Aggregate Levy $ 35,816,907 $ 36,704,066 2.48% Debt Service Levy 1,843,983 2,762,556 49.81% PTAB/CE Recapture 161,995 N/A TOTAL LEVY $ 37,822,885 $ 39,466,622 4.35% The tax levy cap applicable to the 2023 tax levy is 5.0%. The 2023 tax levy estimate reflects: • Assessed valuation estimates provided by the Lake County Assessor’s Office, • required funding for police and fire pension purposes as established by a 4/30/23 independent actuarial valuation and reflecting the Pension Funding Policy approved 8/3/20, as recommended by the Pension Subcommittee, • Required debt service levy amounts as established by bond ordinances approved at the time of debt issuance, including the addition this year of the 2023 Deerpath Park bond issue, • Capital Improvements Fund levy consistent with FY24-28 Five-Year Forecast, • 3.0% increase to the General Fund operating levy, • 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 will be required under the Truth in Taxation Act due to the Debt Service Levy increasing by more than 5.0% over the prior year. A discussion regarding the 2023 tax levy is scheduled for the November 13 Finance Committee budget workshop. The tax levy ordinance will be considered by the City Council on November 20 and again on December 4, 2023. PROJECT REVIEW/RECOMMENDATIONS: Reviewed Date Comments Finance Committee 10/16/23 Reviewed 2023 Tax Levy Estimate City Council 8/3/20 Approval of revised Pension Funding Policy COUNCIL ACTION: Determination of a Non-Binding Estimate of the Amount of Revenue to be Generated from Property Taxes for the 2023 Calendar Year and Establishment of December 4, 2023 as a Public Hearing Date (if required) in Accordance with the Truth in Taxation Statute 5. Approval of Health Insurance Contract Renewals for Calendar Year 2024 STAFF CONTACT: Amber Campbell, Director of Human Resources (847-810-3532) PURPOSE AND ACTION REQUESTED: Staff are recommending the following renewals of the City’s various health insurance vendors: 5 Monday, November 6, 2023, City Council Agenda 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 FY25. Human Resources is not recommending changes this year for strategic considerations as the plan is meeting expectations. 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 retaining the stop loss carrier Symetra this year after a full RFP and moving to Symetra in 2023, after Sun Life was in place for two years. 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. BUDGET/FISCAL IMPACT: Recommendations based on renewal quotes: • Retain Cigna for Life Insurance Coverage Cigna provides a unique contract design and meets 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 6 Monday, November 6, 2023, City Council Agenda 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, add Cigna Embarc Gene Therapy Coverage: Cigna provides networks and managed care services through a contracted relationship with PBA. CIGNA provides broad access and favorable discounts. Cigna is offering Embarc Gene Therapy Coverage that insures against select high-cost gene therapies. Services are meeting expectations. • Retain 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 solicited bids through Wright Benefits in 2021 and 2022. Coverage was placed with Symetra in 2023 after one year with Sun Life. WBS is recommending increasing the Specific deductible per person to $175,000. Optum provides a separate Transplant policy, which helps protect the Stop Loss experience by carving out transplant expenses. Optum rates are increasing 12%, after modest increases over the last three years. WBS recommends retaining Optum carve out coverage. Stop Loss Including Transplant Current Symetra 170k deductible Renewal: Symetra 175k deductible Specific & Aggregate, Transplant Premium $728,920 $808,412 • 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) $1,509 $1,075 Brand Discount Retail/Mail Order 18.5%/24% 19.5%/24.5% Generic Discount Retail/Mail Order 78.25%/83% 85%/87.5% Rebates Paid to Plan $(178,200) $(264,300) 7 Monday, November 6, 2023, City Council Agenda • 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 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. • 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. The Part D Premium is guaranteed for three years until December 2026. Staff recommends continuing to offer this coverage. Age Band-Medical Current January 1, 2024 65-69 $134.28 $141.39 70-74 $154.37 $162.55 75-79 $179.70 $189.22 80-84 $202.98 $213.74 85 and over $213.53 $224.84 Express Scripps Part D $246.00 $257.81 8 Monday, November 6, 2023, City Council Agenda Summary Budget Impact: Funding Source: Self-Insurance Fund Spread over FY24 and FY25 budgets Current Amount Requested Budgeted? Cigna Life Insurance $30,272 $30,272 Yes Summary Pricing Serve You Rx Yes Dispensing Fees (Retail Only) $1,509 $1,075 Yes Administration Fees $23,418 Summary Pricing PBA Admin Fees & CIGNA PPO, Embarc Gene Therapy $161,077 $192,611 Yes Summary Pricing Symetra Stop Loss • Specific & Aggregate Premium $ 678,593 $772,740 Yes • Transplant Premium (Optum) $31,708 $35,672 Yes Summary Pricing Asset Health Wellness $30,000 $30,000 Yes Benistar – Medicare Supplement $190,000 $235,000 100% paid by enrollees Total Annual Plan Costs $1,123,159 $1,297,370 Has City staff obtained competitive pricing for proposed goods/services? NO If no, indicate the specific exception or waiver requested: Administrative Directive 3-5, Section 6.1I – Existing Relationship COUNCIL ACTION: Approval of Health Insurance Contract Renewals for Calendar Year 2024 6. Approval of the FY24 Personnel Policies and Practices and Administrative Directives Changes PRESENTED BY: Amber Campbell, Director of Human Resources (847-810-3532) PURPOSE AND ACTION REQUESTED: City staff is seeking City Council approval of the FY24 Personnel Policies and Administrative Directives. BACKGROUND/DISCUSSION: The City’s Personnel Policies and Administrative Directives are reviewed and updated as needed, then adopted by the City Council. The updates are designed to keep the City compliant with changing laws or to reflect actual practice. All Directives are reviewed at least every five years; sooner if changes are necessary. Noted below is a list of key changes made to the Personnel Policies and various Directives. Complete copies of all documents can be obtained by contacting Director Campbell. 9 Monday, November 6, 2023, City Council Agenda Personnel Page # Personnel Policies and Practices 2023 (Changes noted in Italics) • Positions classifications updated throughout document to identify full-time, temporary full-time, regular benefited part-time, temporary part-time and seasonal employees 1.7.0 Professional Attire – Language updated to reflect 2022 updates and consolidate policy to one location 2.3.1 Tree Trimmer Pay – Moved to Directive 2-14 2.3.14 Longevity Pay – Moved to Directive 2-14, longevity amount for 15- 19 years of service increased to $55, 20+ years of service increased to $95 5.12.0 Jury Duty Language – Language added to permit employees to keep reimbursements for travel expenses including fuel and parking. 8.1.0, 8.2.0, 8.3.0 Insurance and Health Benefits – Language updated to reflect dental benefit eligibility for temporary fulltime employees 8.5.0 Employee Assistance Program – Program specifics removed 6 30 35 35-36 Administrative Directives 2-14 Add’l Pay Administration – Additional pay items consolidated from personnel policies to be included in directive • 4.0 Longevity Pay – moved from personnel policies • 5.0 Tree Trimmer Pay – moved from personnel policies • 6.0 Snow Program Pay – language added to administrative directive during LFEA labor negotiations • 7.0 Julie Locate Pay – moved from personnel policies BUDGET/FISCAL IMPACT: Budget impact for longevity is $9,000 and dental benefits is $7,403. COUNCIL ACTION: Approval of the FY24 Personnel Policies and Practices and Administrative Directives Changes. 7. Approval of a Service Contract to Libertyville Tile & Carpet for the Volwiler Hall Carpet & Flooring Replacement Project in the Amount of $40,477 to Include a Project Contingency in the Amount of $5,000, for a Grand Total Amount of $45,477 STAFF CONTACT: Jim Lockefeer, Assistant Director of Public Works 847-810-3542 PURPOSE AND ACTION REQUESTED: City staff requests City Council approve a service contract to Libertyville Tile & Carpet for the Volwiler Hall Carpet & Flooring Replacement Project in the amount of $40,477 to include a project contingency in the amount of $5,000, for a grand total amount of $45,477. BACKGROUND/DISCUSSION: Volwiler Hall is a City owned building located at the Grove Campus, west of Dickinson Hall (Senior Center). Volwiler Hall is an entirely leased space by the City. The current, largest, occupant of the space is the Music Institute of Chicago. This project scope includes replacing carpet and flooring materials that have greatly exceeded their estimated useful life in the building’s foyer, main office, upstairs rooms, bathrooms, and basement areas. It is estimated that the current carpet and flooring identified to be replaced as part of this project was installed around the year 2000. Generally, the industry standard for the estimated useful life of these materials is ten years. Additionally, this 10 Monday, November 6, 2023, City Council Agenda carpet and flooring was identified as a key finding / recommended priority replacement within the 2021 Volwiler Hall Facility Condition Assessment Report. BUDGET/FISCAL IMPACT: The service contract amount obtained from Libertyville Tile & Carpet for the Volwiler Hall Carpet & Flooring Replacement Project is Sourcewell pricing for both the project materials and installation services. Sourcewell, formerly National Joint Powers Alliance, was created by State law as a service cooperative to provide programs and services to members in education and government. Sourcewell follows the competitive contracting law process to solicit, evaluate, and award cooperative purchasing contracts for goods and services. Sourcewell is a public agency governed by an eight-member board. The City has previously utilized national bids to include Sourcewell, Omnia Partners, State bid, and the Suburban Purchasing Cooperative for equipment and services. Has City staff obtained competitive pricing for proposed goods/services? No Administrative Directive 3-5, Section 6.1D – Government Joint Purchase. Libertyville Tile & Carpet has considerable municipal and commercial carpet and flooring project experience. Additionally, Libertyville Tile & Carpet has completed numerous successful projects for the City that includes flooring installations at the Public Safety Building and in the Everett School Classroom (Parks & Recreation Department Program). This work was completed in a timely manner at a very high quality. Below is an estimated summary of Project budget: Funding Source Amount Budgeted Amount Requested Budgeted? Y/N FY24 Capital Fund 311-1503-467.67-24 $125,000 $45,477 Y If approved, project work would begin in mid-November. COUNCIL ACTION: Approval of a Service Contract to Libertyville Tile & Carpet for the Volwiler Hall Carpet & Flooring Replacement Project in the Amount of $40,477 to Include a Project Contingency in the Amount of $5,000, for a Grand Total Amount of $45,477 8. Approval to authorize the City Manager to Award a Contract for Tree Pruning for FY2024 to Advanced Tree Care, for an Amount Not to Exceed $70,000 STAFF CONTACT: Corey Wierema, City Forester/Forestry Supervisor 847-810-3564 PURPOSE AND ACTION REQUESTED: Staff is requesting City Council approval for the City of Lake Forest to join the Municipal Partnership Initiative (MPI) Tree Pruning contract and enter into a three-year contract with Advanced Tree Care. BACKGROUND/DISCUSSION: Starting with FY2024, the City will begin its first eight-year cycle pruning plan. Cycle pruning is an essential practice in urban forestry that helps maintain a healthy urban forest. By removing dead and competing branches, pruning encourages healthy new growth and maturation, maximizing a tree’s value and supporting its numerous environmental and community benefits, including increased property values. 11 Monday, November 6, 2023, City Council Agenda Under this contract, the City will prune approximately 1,500 trees contractually in FY2024. This work will extend the functional lifespan of the City’s trees, delay long-term expenses associated with removing and replacing unhealthy trees, and decrease the cost and liability associated with storm damage. The City Council has been briefed on the MPI, a program that uses economies of scale to secure low bid prices among neighboring municipalities that bid on similar projects yearly. BUDGET/FISCAL IMPACT: The MPI Tree Pruning contract term agreement is from January 2023 through December 2025. The City of Lake Forest reserves the right to renew this contract for two (2) additional one (1) year periods subject to acceptable performance by the contractor. The Village of Glenview initiated a joint public bidding process via the MPI to include the following categories of tree work: Group “A” Tree Removal, Group “B” Stump Removal, Group “C” Tree pruning. Four bids were received for the 2024 MPI Tree Group “C” Pruning Contract, and Advanced Tree Care provided the lowest proposed cost. At the time of the bid posting, the City did not participate. As with many MPI bid processes, other municipalities may join existing bid opportunities as authorized by the Governmental Joint Purchasing Act, 30 ILCS 525/0.01 et seq. (the “Act”) to take advantage of already secured pricing. By joining the MPI Group “C” Tree pruning (see table below), the City will save an estimated $12,500 this fiscal year on necessary tree pruning. If awarded, work on this project is expected to be completed before March 31, 2024. City Forestry staff will provide daily oversight and quality control. Group "C" Tree Pruning Vendors Advanced Tree Care 600 Industrial Dr, Lincolnshire, IL Lucas Landscaping and Design 13510 W. Rockland Rd., Lake Bluff, IL Clean Cut Tree Services LLC 31064 N IL Route 83, Grayslake, IL Winkler Services LLC, PO Box 1154, LaGrange Park, IL Size (DBH) Category Price Per Inch (DBH) Price Per Inch (DBH) Price Per Inch (DBH) Price Per Inch (DBH) 1-7" $2.10 $2.35 $6.00 $14.00 8-15" $2.50 $2.75 $8.00 $7.00 16" & up $2.90 $3.50 $12.00 $5.00 Has competitive pricing been obtained for proposed goods/services? Yes FY2024 Funding Source Amount Budgeted Amount Requested Budgeted? Y/N 220-5888-435.35-10 Forestry Operating Fund $70,000 $70,000 Y COUNCIL ACTION: Approval to authorize the City Manager to Award a Contract for Tree Pruning for FY2024 to Advanced Tree Care, for an Amount Not to Exceed $70,000 12 Monday, November 6, 2023, City Council Agenda 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 along with the associated Ordinance. BACKGROUND: 1965 Amberley Court – The Building Review Board considered a request for approval of modifications including minor changes to the roofline and building footprint and changes to the proportions and placement of some of the windows. The Board recommended approval of the proposed modifications subject to some refinement. There was no public testimony presented to the Board on this petition. (Board vote: 6-0, approved) An Ordinance approving the petition as recommended by the Building Review Board with key exhibits attached is included in the Council packet beginning on page 220. 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. 10. Consideration of an Ordinance Approving a Recommendation from the Zoning Board of Appeals for 1291 Elm Tree Road. (First Reading, and if Desired by the City Council, Final Approval) STAFF CONTACT: Catherine Czerniak, Director of Community Development 847-810-3504 PURPOSE AND ACTION REQUESTED: The following recommendation from the Zoning Board of Appeals is presented to the City Council for consideration as part of the Omnibus Agenda along with the associated Ordinance. BACKGROUND 1291 Elm Tree Road – The Zoning Board of Appeals recommended approval of an Ordinance granting a variance to allow a small addition and mechanical equipment enclosure to encroach into the steep slope setback. The City Engineer reviewed the plans and recommended support of the variance to the Board. No testimony was presented to the Board on this petition. (Board vote: 6-0, approved) The Ordinance approving a variance from the steep slope setback for 1291 Elm Tree Road as recommended by the Zoning Board of Appeals, with key exhibits attached, is included in the Council packet beginning on page 228. The Ordinance, complete with all exhibits, is available for review in the Community Development Department. 13 Monday, November 6, 2023, City Council Agenda COUNCIL ACTION: If determined to be appropriate by the City Council, waive first reading and grant final approval of the Ordinance approving a variance from the steep slope setback for 1291 Elm Tree Road in accordance with the Zoning Board of Appeals’ recommendations. COUNCIL ACTION: Approve the ten (10) omnibus items as presented 6. OLD BUSINESS 7.NEW BUSINESS 1.Consideration of a Recommendation from the Plan Commission in Support of a Special Use Permit for “Tocco – Simple, Fresh Italian” a Restaurant Proposed in Westwood Center, 950 N. Western Avenue. (If desired by the Council, Waive First Reading and Grant Final Approval of the Ordinance.) PRESENTED BY: Catherine Czerniak, Director of Community Development (847-810-3504) PURPOSE AND ACTION REQUESTED: A recommendation from the Plan Commission in support of a new restaurant is presented for City Council consideration. BACKGROUND/DISCUSSION: The City Code classifies restaurants located within 150’ of residential zoning districts as special uses. Restaurants located further away from residential properties are permitted outright. Special uses proposed in the City’s business districts require consideration by the Plan Commission through the public hearing process. The review process assures that proposed restaurants are considered in the context of both the nearby residential neighborhood and the business district and provides the opportunity for public input. This is a request for a Special Use Permit to allow Tocco to occupy space fronting on Western Avenue in the Westwood Center commercial development. Westwood Center is a multi- tenant, mixed use development located on the southwest corner of Western Avenue and Woodland Road, in the B-2 Community Business District. In recent years, the Westwood Center development has been re-energized. Today, Kuro Bistro, Donati’s/Jefe’s Tacos, and Duffer’s Pub are all located in Westwood Center and are popular with residents and visitors. Bruno Abate is the owner of Tocco, an Italian restaurant in Winnetka. Mr. Abate is proposing to open an additional Tocco restaurant in Lake Forest, just north of Duffer’s Pub in space last occupied by another restaurant, King Maa, and incorporating space previously occupied by Michael’s barber shop. The square footage of the restaurant will be approximately 2,350 square feet with additional space for outdoor dining in the courtyard, seasonally. The restaurant will employ 15 to 20 people and as currently planned, will offer both lunch and dinner. No public testimony was presented to the Commission on this petition at the meeting, one letter was received from a neighbor. The Commission confirmed that staff has not received 14 Monday, November 6, 2023, City Council Agenda complaints from neighbors about impacts from the existing restaurants at Westwood Center and pointed out that the conditions of approval as recommended mitigate impacts on the surrounding neighborhood. The Commission enthusiastically voted 4 to 0 to recommend approval of a Special Use Permit for Tocco to the City Council. The recommendation includes conditions of approval consistent with those previously approved for other restaurants in this development. The conditions as recommended by the Commission are detailed in the ordinance which is included in the Council packet beginning on page 234. COUNCIL ACTION: If determined to be appropriate by the City Council, waive first reading and grant final approval of an Ordinance approving a Special Use Permit for Tocco at Westwood Center, 950 N. Western Avenue in accordance with the Plan Commission’s recommendation. 8.ADDITIONAL ITEMS FOR DISCUSSION/ COMMENTS BY COUNCIL MEMBERS 9.ADJOURNMENT A copy of the Decision Making Parameters is included beginning on page 16 of this packet. Office of the City Manager November 1, 2023 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. 15 ^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. 16 Execution Version 1 DONATION AND NAMING RIGHTS AGREEMENT THIS DONATION AND NAMING RIGHTS AGREEMENT (“Agreement”) is made and entered into as of the ________ day of , 2023, by and among (i) The City of Lake Forest, in Lake County, Illinois (“City”), (ii) Friends of Lake Forest Parks and Recreation Foundation (“Friends”), and (iii) Little Orchard Foundation (“Donor”). WHEREAS, the City is a special charter and home rule unit of government in Illinois that is a tax-exempt entity under Internal Revenue Code Section 170(c)(1); and WHEREAS, Friends is a nonprofit organization exempt from federal income tax under Internal Revenue Code Section 501(c)(3) that provides funds for programs and facilities for the Lake Forest Parks and Recreation Department that fall outside the City’s budget; and WHEREAS, the City owns and operates a public recreational park known as Forest Park, Lake Forest, Illinois (the “Park”); and WHEREAS, the City has commenced a public renovation project of certain bluffs in the Park, which will include the replacement of the public wooden walk pathway (“Wooden Walk Pathway”) as depicted in the illustration attached hereto as Exhibit A (“Replacement Project”); and WHEREAS, the Wooden Walk Pathway is now, and following the Replacement Project, will continue to be, used for public access to the public Lake Forest Beach (“the Beach”); and WHEREAS, the Donor desires to assist the City in financing the Replacement Project through a contribution to Friends, which is facilitating the collection of donations toward the Replacement Project on behalf of the City; and WHEREAS, in exchange for good and valuable consideration, as more fully described herein, upon completion of the Replacement Project, the City will rename the new Wooden Walk Pathway from the Park to the Beach level “Rheda’s Way.” NOW, THEREFORE, in consideration of the premises, and for other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereby mutually covenant and agree as follows: 1. Incorporation of Recitals. The recitals stated above are an integral part of this Agreement and are incorporated into this Agreement by reference and made a part hereof. 2. Donation. In consideration for the rights granted to the Donor under this Agreement and other good and valuable consideration, and subject to the terms and conditions of this Agreement, the Donor hereby agrees to contribute to Friends, to be used exclusively to fund the Replacement Project, the aggregate sum of Five Hundred Thousand Dollars ($500,000.00) (the “Donation”). The Donation shall be paid in installments as provided below (each, an “Installment”); provided that each Installment payment to Friends shall be contingent on the City’s timely achievement of each 17 Execution Version 2 milestone set forth in the far right column below (each, a “Milestone”). The Donor will pay each Installment within ten (10) days of receiving written notification (via email) from the City Manager of achievement of the relevant Milestone. Installment Amount Milestone 1 $125,000 Approval of the construction bid for the Replacement Project by the City Council of the City of Lake Forest 2 $125,000 Physical construction begins on the Replacement Project 3 $125,000 The City deems the steel work on the Replacement Project to be 50% complete 4 $125,000 The City deems the Replacement Project to be 95% complete and permanent Naming signage is approved by the Donor and ready to be installed Friends will transmit each Installment payment to the City immediately following receipt. The Donor may withhold any payment to Friends if the Donor determines in good faith that the relevant Milestone has not been met. The Donor acknowledges that all the City’s obligations hereunder are expressly subject to the receipt of the Donation by Friends. 3. Naming. In consideration of the Donation, and upon completion of the Replacement Project and payment of the full Donation by Donor, the City will acknowledge the Donation by naming the new public Wooden Walk Pathway from the Park to the Beach level “Rheda’s Way” (the “Naming”). 4. Naming Exclusivity. No other donors will have naming rights to the Wooden Walk Pathway as a whole, or naming rights to either entrance to or features along the Wooden Walk Pathway; provided, however, that the City may grant naming rights for benches along the Wooden Walk Pathway to other donors. Any such benches and naming signage on the benches will be consistent in size and scale to the existing benches located on the Beach. 5. Naming Signage. The Naming signage will be placed at the Beach level entrance and the parking lot level entrance to the Wooden Walk Pathway. The Naming signage will be modeled after the existing stone pillars located at the access road at the north end of the Park (at an appropriate scale for the Wooden Walk Pathway) and is subject to the Donor’s approval. The City will coordinate with the Donor regarding the fabrication of the Naming panel, if that element is not incorporated into the fabrication of the pillars, and the City will be responsible for the cost of the Naming panel and Naming signage. Additionally, “Diana and David Moore” will be recognized on a donor board to be located on the Beach level at the North Pavilion. Upon the expiration of the Term of this Agreement, “Diana and David Moore” will be recognized as a “Legacy” donor on a donor board at 18 Execution Version 3 the Park. The City agrees that the permanent Naming signage will be in place prior to opening the Wooden Walk Pathway to the public. 6. Additional Donors. Additional Wooden Walk Pathway donors will be recognized by the City on a donor board to be located on the Beach level at the North Pavilion and may also be recognized on benches, as described in paragraph 4. 7. Construction of the Replacement Project. The City has commenced the planning of the Replacement Project and agrees to proceed with all deliberate speed using reasonably accepted commercial business practices to complete the Replacement Project. 8. Term. The parties recognize that the new Wooden Walk Pathway has a useful life period after which time the Wooden Walk Pathway will need to be renovated or replaced. The useful life period of the Wooden Walk Pathway is estimated to be thirty-five (35) years. Therefore, this Agreement will terminate upon the first to occur of (i) the failure of Donor to fulfill its obligations under this Agreement; (ii) at the option of the Donor, the failure of the City to achieve the first Milestone within six months of the date of this Agreement; (iii) at the option of the Donor, the failure of the City to achieve the fourth and final Milestone within one (1) year from commencement of physical construction on the Replacement Project, excluding any delays caused by acts of God, weather, or other factors beyond the City’s reasonable control and ability to remedy; (iv) the failure of the steel and concrete superstructure of the Wooden Walk Pathway to such an extent that the Wooden Walk Pathway needs to be substantially replaced, regardless of whether such failure is caused by damage or natural deterioration, but only if such failure was not a result of the City’s gross negligence or willful misconduct in the Replacement Project; or (v) December 31, 2058. 9. Periodic Reports. If requested by the Donor, the City shall provide to the Donor a progress report each quarter during the Replacement Project and a final report detailing the City’s use of the Donation for the Replacement Project. 10. Termination. In addition to any rights and remedies available at law, the City may terminate this Agreement and all rights and benefits of the Donor hereunder, including termination of the Naming, in the unlikely event that the City determines, in its reasonable and good faith opinion, that circumstances have changed such that the Naming chosen by the Donor would adversely impact the reputation, image, mission and integrity of the City. 11. Notice. Notices under this Agreement shall be given in person, by email or by U.S. mail as follows: If to the Donor: Little Orchard Foundation c/o Diana and David Moore 255 N. Mayflower Rd. Lake Forest, Illinois 60045 Diana Moore (diana@ddthmg.com) David Moore (david@ddthmg.com) Joseph Stinton (Joseph.Stinton@gs.com) 19 Execution Version 4 If to the City: The City of Lake Forest 220 E. Deerpath Lake Forest, Illinois 60045 Jason Wicha (WichaJ@cityoflakeforest.com) Kurt Asprooth (kasprooth@ancelglink.com) If to Friends: Friends of Lake Forest Parks and Recreation Foundation 400 Hastings Road Lake Forest, Illinois 60045 ____________________________________ 12. Relationship. The relationship of the Donor to the City and to Friends is that of independent charitable contributor. No party to this Agreement shall be or become the agent of the other party or parties for any purpose. This is not a franchise agreement and does not create a partnership or joint venture. Nothing herein contained shall be construed to give the Donor any property interest in or control over the Park or the new Wooden Walk Pathway in the Park. 13. Authority to Execute. The City represents that it has legal authority to enter into this Agreement, and that the City Council has granted authority to the representative named below to bind the City. The Donor represents that it has legal authority to enter into this Agreement. Friends represents that it has legal authority to enter into this Agreement. 14. Miscellaneous. This Agreement will be governed by and construed in accordance with the laws of Illinois, and any actions concerning the interpretation or enforcement of this Agreement shall be brought in the Circuit Court of Lake County, Illinois. This Agreement will bind and benefit the parties and their legal representatives and successors. This Agreement sets forth the entire understanding between the parties concerning the subject matter thereof, and any amendment or discharge will be made only in writing. This Agreement may be amended or modified in whole or in part by City and Donor in writing at any time. [Signature Page Follows] 20 Execution Version 5 IN WITNESS WHEREOF, this Agreement is entered into by and between the parties hereto as of the date and year first above written. ATTEST: THE CITY OF LAKE FOREST By: Margaret Boyer, City Clerk Stanford Tack, Mayor Dated: Dated: LITTLE ORCHARD FOUNDATION By: ________________________________ Dated: FRIENDS OF LAKE FOREST PARKS AND RECREATION FOUNDATION By: ________________________________ Dated: 21 Execution Version 6 Exhibit A Wooden Walk Pathway Illustration 22 Resolution of Appreciation for Michael P. Whalen WHEREAS, MICHAEL P. WHALEN, joined the City of Lake Forest on August 24th, 1992 as an Electrical Inspector for what was then the Building and Zoning Development; and WHEREAS, Mike honorably retired from the City on November 3rd, 2023, after serving the residents of Lake Forest in various capacities for over 31 years as he progressed through his career ultimately advancing to the position of the City’s Lead Residential Plan Reviewer in the Community Development Department; and WHEREAS, Mike consistently supported his co-workers by teaching, guiding, encouraging, and challenging them; and WHEREAS, Mike is valued and respected not only by his colleagues, but also by architects and contractors for his expertise and more importantly, for his willingness to problem solve collaboratively and creatively; and WHEREAS, Mike not only had a vast knowledge of building and life safety codes, but also recognized that Codes are not black and white but instead, require thoughtful interpretation and application with sensitivity to historic buildings, the unique character of Lake Forest, the expected high quality of construction in the community, and the individual circumstances of each project; and WHEREAS, Mike embraced technology and was a leader in ensuring that the Community Development Department pivoted quickly to remote plan reviews, inspections, and permit issuance during the pandemic; and WHEREAS, Mike has pushed for continuous improvement in the Department streamlining processes, creating efficiencies, and increasing effectiveness, all to the benefit of our customers, the built environment, and the overall community; and WHEREAS, and maybe most importantly, Mike made lunchtimes special with his lengthy list of options and takeout restaurants; he ordered, picked up, and delivered making sure that no one ever went hungry; and WHEREAS, Mike, although you and JoAnn recently completed your Route 66 journey, there are miles and miles of open road left for you to explore together and we wish you safe travels and many wonderful adventures as you ride off into the sunset. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LAKE FOREST that the City Council, on behalf of the entire City organization and the residents of the community, hereby expresses its gratitude to 23 MICHAEL P. WHALEN for a public service faithfully, diligently, and honorably performed; and BE IT FURTHER RESOLVED that this Resolution be appropriately inscribed and conveyed to MIKE with a copy to be included in the official minutes of the November 6, 2023 meeting of the Lake Forest City Council. Stanford R. Tack, Mayor 24 Annual Comprehensive Financial Report City of Lake Forest, Illinois For the Year Ended April 30, 2023 25 Annual Comprehensive Financial Report of the City of Lake Forest, Illinois Fiscal Year Ended April 30, 2023 City of Lake Forest Finance Department Elizabeth Holleb, Finance Director Diane Hall, Assistant Finance Director 26 City of Lake Forest Table of Contents Year Ended April 30, 2023 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 21 Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds 22 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities 23 Statement of Net Position - Proprietary Funds 24 Statement of Revenues, Expenses and Changes in Net Position - Proprietary Funds 26 Statement of Cash Flows - Proprietary Funds 27 Statement of Fiduciary Net Position - Fiduciary Funds 29 Statement of Changes in Fiduciary Net Position - Fiduciary Funds 30 Index to Notes to Financial Statements 31 Notes to Financial Statements 32 27 City of Lake Forest Table of Contents April 30, 2023 Page Required Supplementary Information General Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - General Fund 80 Special Revenue Fund Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Parks and Recreation Fund 81 Historical Pension and Other Postemployment Benefit Information Illinois Municipal Retirement Fund - Schedule of Changes in the City's Net Pension Liability/(Asset) and Related Ratios 82 Illinois Municipal Retirement Fund - Schedule of Employer Contributions 85 Police Pension Fund - Schedule of Changes in the City's Net Pension Liability and Related Ratios 86 Police Pension Fund - Schedule of Employer Contributions 87 Police Pension Fund - Schedule of Investment Returns 89 Firefighters' Pension Fund - Schedule of Changes in the City's Net Pension Liability and Related Ratios 90 Firefighters' Pension Fund - Schedule of Employer Contributions 91 Firefighters' Pension Fund - Schedule of Investment Returns 93 Other Postemployment Benefits Plan - Schedule of Changes in the City's Total OPEB Liability and Related Ratios 94 Notes to Required Supplementary Information 95 Supplementary Information Governmental Funds Combining Balance Sheet - Nonmajor Governmental Funds 96 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 98 Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Police Restricted Fund 100 Foreign Fire Insurance Tax Fund 101 Emergency Telephone Fund 102 Parks and Public Land Fund 103 Motor Fuel Tax Fund 104 28 City of Lake Forest Table of Contents April 30, 2023 Page Senior Resources Commission Fund 105 Housing Trust Fund 106 General Cemetery 107 Debt Service Fund 108 Laurel/W estern Redevelopment TIF Fund 109 Capital Improvements Fund 110 Enterprise Funds Schedules of Revenues, Expenses and Nonoperating Revenues (Expenses) - Budget and Actual (Budgetary Basis) Waterworks and Sewerage Fund 111 Deerpath Golf Course Fund 112 Internal Service Funds Combining Statement of Net Position 113 Combining Statement of Revenues, Expenses and Changes in Net Position 114 Combining Statement of Cash Flows 115 Schedules of Revenues, Expenses and Nonoperating Revenues - Budget and Actual (Budgetary Basis) Fleet Fund 116 Self Insurance Fund 117 Liability Insurance Fund 118 Fiduciary Funds Combining Statement of Fiduciary Net Position - Pension Trust Funds 119 Combining Statement of Changes in Fiduciary Net Position - Pension Trust Funds 120 Schedule of Changes in Fiduciary Net Position - Budget and Actual Police Pension Fund - Pension Trust Fund 121 Firefighters' Pension Fund - Pension Trust Fund 122 Other Supplementary Schedules Statement of Net Position and General Fund Balance Sheet - Discretely Presented Component Unit - Lake Forest Library 123 Statement of Activities and General Fund Statement of Revenues, Expenditures and Changes in Fund Balance - Discretely Presented Component Unit - Lake Forest Library 124 29 City of Lake Forest Table of Contents April 30, 2023 Page Summary of Debt Service Requirements to Maturity 125 Debt Service Requirements to Maturity - General Obligation Bonds 126 Special Service Area 29 Special Tax Bonds - 2004 Series 129 General Obligation Bonds - 2015 Series 130 General Obligation Bonds - 2017 Series 131 General Obligation Bonds - 2019 Series 132 General Obligation Bonds - 2021 Series 133 General Obligation Bonds - 2023 Series 134 Combining Balance Sheet - Debt Service Fund 135 Combining Schedule of Revenues, Expenditures and Changes in Fund Balances - Debt Service Fund 137 Statistical Section Net Position by Component - Last Ten Fiscal Years 139 Change in Net Position - Last Ten Fiscal Years 140 Fund Balances of Governmental Funds - Last Ten Fiscal Years 142 Change in Fund Balances for Governmental Funds - Last Ten Fiscal Years 143 Assessed Value and Actual Value of Taxable Property - Last Ten Levy Years 144 Property Tax Rates - Direct and Overlapping Governments - Last Ten Levy Years 145 Principal Property Taxpayers - Current Year and Nine Years Ago 146 Property Tax Levies and Collections - Last Ten Levy Years 147 Tax Extensions for City Funds - Last Ten Levy Years 148 Sales Tax Base and Number of Principal Payers - Taxable Sales by Category - Home Rule Sales Tax - Last Ten Calendar Years 149 Sales Tax Base and Number of Principal Payers - Taxable Sales by Category - Municipal Sales Tax - Last Ten Calendar Years 150 Direct and Overlapping Sales Tax Rates - Last Ten Fiscal Years 151 Ratios of Outstanding Debt by Type - Last Ten Fiscal Years 152 Ratios of General Bonded Debt Outstanding - Last Ten Fiscal Years 153 Direct and Overlapping Governmental Activities Debt 154 Legal Debt Margin Information - Last Ten Fiscal Years 155 Pledged Revenue Coverage - Last Ten Fiscal Years 15630 City of Lake Forest Table of Contents April 30, 2023 Page Demographic and Economic Information - Last Ten Fiscal Years 157 Principal Employers - Current Year and Nine Years Ago 158 Full-Time Equivalent Employees - Last Ten Fiscal Years 159 Operating Indicators - Last Ten Fiscal Years 160 Capital Asset Statistics - Last Ten Fiscal Years 162 31 i October 19, 2023 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, 2023, 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, 2023, 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, 2023, 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. 32 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 19,367 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, 2017-2021 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 194,267 812,900 95,796 306,800 72,205 247,500 0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000 Median Household Income Median Home Value Lake Forest Lake County Illinois 33 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 and Parks and Recreation 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 2022, the City’s annual average unemployment rate was estimated to be 3.5%, compared to 4.2% for Lake County and 4.6% 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 2023, the index was 106.1, down from 117.0 in July, and comparing favorably to the August 2022 index of 103.2. 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 72.5% of the General Fund operating budget, it has been necessary to achieve cost savings through reduced personnel. In fiscal years (FY) 2004-2024, the City has reduced budgeted full-time employees by 43 positions (16.44%), 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 FY2023 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 administration fee of 2% on home rule sales tax collections (reduced to 1.5% for SFY19). The State has 34 iv returned to 100% funding of the City’s portion of income tax distributions, which has been incorporated into the FY24 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. During FY23, a review of the Comprehensive Land Use Plan as it relates to the Central Business District was conducted with community engagement to provide guidance for future development. The final recommendation was approved by the City Council on August 7, 2023. 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. The monthly financial “flash” reports are now available on the City’s website for additional transparency. 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 FY2023. 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 FY21. 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 and 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 35 v 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. FY2023 real estate transfer tax revenue totaled $2.1 million, which is $.5 million over budget. Significant fluctuations occur in this revenue source due to 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, 2023, the most recent actuarial valuation date, the funded ratio for the Police Pension Plan is 54.91% and for the Firefighters’ Pension Plan is 67.12%. Funding ratios were negatively impacted by investment returns of 1.15% for the Police Pension Fund and .56% for the Firefighters’ Pension Fund in FY23. 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. Funding ratios were negatively impacted as of December 31, 2022 due to a 2022 investment return of -12.9%, the funded ratio for IMRF is 91.59%, 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. 36 vi 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 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. Leases. Implementation of GASB Statement No. 87, Leases for Fiscal Year 2023 has resulted in changes to the reporting of leases for both the financial statements and government-wide financial statements. Lease receivables and corresponding deferred inflow of resources are now recorded on the financial statements. For FY23, this resulted in the addition of $1.8 million in receivables to cover the anticipated lease revenue over the course of the lease. 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 FY2023, 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 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 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. The plan includes 165 total units – 12 single family homes, 42 condominium units and 111 apartments. As of April 30, 2023 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 is imminent; construction plans have been submitted for City review. Nine single family homes have been sold and one additional home is under construction. The first Note payment was made in FY22. In FY23, the Note payment of $900,000 from Tax Increment proceeds for the sale of the property to a developer was made. A total of $1.4 million has been paid on the 37 vii outstanding Note. Additional information on the City’s TIF District, may be found in Note 4 of the financial statements. • 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 December 2021, the City Council authorized $1,183,174 for the replacement of the Illinois and Woodland Pedestrian Bridges. • In April 2022, the City Council authorized $5,007,229 for the construction of Burr Oak Area Storm Sewer Project. • In September 2022, the City received the second of two payments from the American Rescue Plan Act. The City received a total of $2.6 million which will be used to fund a storm sewer project. • In September 2022, the City Council approved $268,363 for the Forest Park Beach Restoration Project. • In February 2023, the City Council approved $16,431,870 for the Deerpath Park Athletic Field Improvement Project. The project to be funded through transfers from General Fund operating surplus, General Obligation Bond (GOB) issue and Parks and Public Land Fund. • In March 2023, the City Council approved $905,000 for renovations of the Cemetery Memorial Garden, to be financed through a loan from the City’s General Fund. • In April 2023, the City issued General Obligation Bonds, Series 2023 $10,770,000 to fund the Deerpath Park Athletic Field Project. 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, 2022. This was the 44th 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 38 viii 39 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 40 x List of Principal Officials Year Ended April 30, 2023 LEGISLATIVE City Council George Pandaleon, Mayor James E. Morris Melanie Rummel Nancy P. Novit Ted Notz Jr. Jim Preschlack Ara Goshgarian Eileen Looby Weber AUDIT COMMITTEE Tara Janos, Chairman Tighe Magnuson Fritz Hirsch Mark Dillon Terry Mieling 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 41 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. © 2020-2022 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 aggregate remaining fund information of the City of Lake Forest, Illinois (the City), as of and for the year ended April 30, 2023, 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 accompanying 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 aggregate remaining fund information of the City as of April 30, 2023 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 (Government Auditing Standards). Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Financial Statements section of our report. W e are required to be independent of the 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. Emphasis of Matter As discussed in Note 1, the City adopted the provisions of GASB Statement No. 87, Leases, effective May 1, 2022. Our opinions are not modified with respect to this matter. Responsibilities of Management for the Financial Statements Management 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 raise 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 42 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 Government Auditing Standards 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 Government Auditing Standards, 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 43 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 comprehensive financial 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 19, 2023 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 19, 2023 3 44 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 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 $10.6 million for the fiscal year ending April 30, 2023 (FY23). Governmental net position increased $9.8 million and business-type net position increased $.8 million. • The governmental activities revenue increased by $5.9 million (8.9%) due primarily to increased investment income of $3.7 million. The expenses increased by $11.3 million (22.3%) due primarily to adjustments related to pensions. • The business-type activities revenue decreased by $1.2 million (10.5%) primarily due to a decrease in charges for services in the Water and Sewer Fund. The City’s business-type activity expenses increased by $1.1 million (11.4%) due primarily to pension adjustments and non-capitalized improvements. • The total cost of all City programs increased from $60.3 million in FY22 to $72.7 million in FY23 – an increase of $12.4 million or 20.6% - attributable to, 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. 45 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 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 $10.6 million for FY23 – from $253.9 million to $264.5 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 $9.8 million – from $201.9 million to $211.7 million. The business-type activities net position increased by $.8 million – from $52.0 million to $52.8 million. Table 1 reflects the condensed Statement of Net Position compared to FY22. Table 2 will focus on the changes in net position of the governmental and business-type activities. 46 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 6 Table 1 Statement of Net Position As of April 30, 2022 and 2023 (in millions) Governmental Business- Type Total Primary Activities Activities Government 2022 2023 2022 2023 2022 2023 Current and Other Assets $140.2 $150.7 $16.5 $17.7 $156.7 $168.4 Capital Assets 192.0 194.2 51.3 48.5 243.3 242.7 Total Assets 332.2 344.9 67.8 66.2 400.0 411.1 Deferred Outflows 8.5 19.3 .3 1.3 8.8 20.6 Long- Term Liabilities 83.0 106.5 13.2 12.2 96.2 118.7 Other Liabilities 9.7 11.6 .8 .9 10.5 12.5 Total Liabilities 92.7 118.1 14.0 13.1 106.7 131.2 Deferred Inflows 46.1 34.4 2.1 1.6 48.2 36.0 Net Position: Net Investment in Capital Assets 165.8 170.0 38.6 37.9 204.4 207.9 Restricted 57.7 50.8 2.0 59.7 50.8 Unrestricted (21.6) (9.1) 11.4 14.9 (10.2) 5.8 Total Net Position $201.9 $211.7 $52.0 $52.8 $253.9 $264.5 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. Reduction of Capital Assets through Depreciation will reduce capital assets and net investment in capital assets. 47 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 7 Current Year Impacts The City’s $10.6 million increase in combined net position (which is the City’s bottom line) was the result of the governmental activities net position increasing by $9.8 million and the business-type activities net position increasing by $.8 million. The governmental activities total assets increased by $12.7 million (3.8%) and the governmental activities total liabilities increased by $25.4 million (27.4%). 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. 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 increase in deferred outflows of $10.8 million relates to pensions, and a decrease in deferred inflows of $11.7 million relates to pensions offset by an increase in property taxes levied for future periods, OPEB and the addition of leases with the implementation of GASB Statement No. 87. Net investment in capital assets increased by $4.2 million (2.5%) due to the completion of the Burr Oak Storm Water project and the pay down of G.O. Bonds that funded the capital assets. Restricted net position decreased $6.9 million largely due to decreased restricted net positions related to employee retirements ($12.8 million) offset by excess fund balance from the General Fund transferred to the Capital Improvement Fund to fund the FY24 synthetic turf project ($4.0 million) and increased investment income ($3.7 million). Unrestricted net position decreased by $12.5 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 $.8 million, from $52.0 million to $52.8 million. The primary change in assets of the business-type activities was an increase of unrestricted net position ($3.5 million) primarily due to the net effect of GASB 68 reporting offset by a decrease in capital assets ($.7 million) and a decrease in restricted net position for employee retirements ($2.0 million). Long-term liabilities decreased by $1.0 million due to scheduled maturities of debt obligations. Net investment in capital assets decreased by $.7 million due to bond-funded capital improvements, restricted net position decreased by $2.0 million related to employee retirements and unrestricted net position increased by $3.5 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 $8.7 million per year and interest expense on bonds is $.3 million. Changes in Net Position The City’s combined change in net position was an increase of $10.6 million in FY23. The City’s total revenues increased by $4.7 million, primarily driven by increased property taxes, intergovernmental taxes and investment income. The City’s cost of all programs increased by $12.4 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. 48 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 8 2022 2023 2022 2023 2022 2023 REVENUE Program Revenue Charges for Services $13.9 $14.2 $11.5 $10.6 $25.4 $24.8 Grants and Contributions Operating 1.2 1.3 0.0 0.0 1.2 1.3 Capital 2.4 3.4 0.6 0.1 3.0 3.5 General Revenue Property Taxes 32.1 33.1 32.1 33.1 Other Taxes 7.4 7.3 7.4 7.3 Intergovernmental - Taxes 8.1 8.2 8.1 8.2 Interest Revenue (0.9) 2.8 0.1 0.5 (0.8) 3.3 Other 1.8 1.6 0.4 0.2 2.2 1.8 Total Revenue 66.0 71.9 12.6 11.4 78.6 83.3 EXPENSES Governmental Activities General Government 11.2 15.2 11.2 15.2 Highways and Streets 6.9 8.0 6.9 8.0 Sanitation 1.9 3.0 1.9 3.0 Culture and Recreation 9.2 12.4 9.2 12.4 Public Safety 20.6 22.9 20.6 22.9 Interest 0.9 0.5 0.9 0.5 Business-Type Activities Water and Sewer 7.4 8.5 7.4 8.5 Golf 2.2 2.2 2.2 2.2 Total Expenses 50.7 62.0 9.6 10.7 60.3 72.7 Excess before Transfers 15.3 9.9 3.0 0.7 18.3 10.6 Transfers In (out)0.0 (0.1) 0.0 0.1 0.0 0.0 Change in Net Position 15.3 9.8 3.0 0.8 18.3 10.6 Net Position - Beginning 186.6 201.9 49.0 52.0 235.6 253.9 Net Position - Ending $201.9 $211.7 $52.0 $52.8 $253.9 $264.5 Activities Business-Type Activities Total Primary Government Table 2 Changes in Net Position For the Fiscal Year Ended April 30, 2022 and 2023 (in millions) Governmental 49 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 9 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 Property Tax 46% Sales Tax 7% Income Tax 5% Utility Tax 4% Real Estate Transfer Tax 3% Charges for Services 20%Grants 6% Other 5% Inv Income 4% FY2023 Governmental Activities Revenue 50 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 10 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 General Government 24% Highways and Streets 13% Sanitation 5% Culture and Recreation 20% Public Safety 37%Interest on LT Debt 1% FY2023 Governmental Activities Expenses 51 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 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 72.5% 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, 2023, revenues from governmental activities totaled $71.9 million, increasing $5.9 million compared to FY22. The primary changes occurred in Property Taxes (up $1.0 million), Charges for Services (up $.3 million), Grants and Contributions (up $1.1 million), Sales Taxes (up $.5 million), Interest Revenue (up $3.7 million) and Real Estate Transfer Taxes (down $.5 million). Investment income increased due to rising interest rates. Real Estate Transfer Tax decreased due to declining housing market impacted by rising interest rates. Property tax revenue continues to be the City’s single largest revenue source, contributing $33.1 million (46.0%) 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 $46.9 million and represent 65.2% of the total governmental activities’ revenue. 52 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 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 2022 equalized assessed valuation increased 1.8% compared to the prior year and totaled $2,426,166,029. 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 3.1% over FY22 in property taxes was generated as a result of the City Council adopting a 2.5% increase in the levy and new growth. The City received $1.5 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 1.4%, the levies for debt service, Police and Fire Pensions and capital improvements combined exceeded the tax cap. Investment income increased by $3.7 million, from $-.9 million to $2.8 million. The City’s strategy for investing did not change but the City was impacted by changing market conditions primarily due to increased interest rates. Expenses For the fiscal year ended April 30, 2023, expenses for governmental activities totaled $62.0 million, an increase of $11.3 million (22.3%). The increase is due in large part to pension adjustments. Increases in personnel costs, which represent nearly 72.5% 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 FY23 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 decreased by $1.2 million (10.5%) primarily due to a decrease of charges for services in the Water and Sewerage Fund offset by increases in the Golf Course Fund and decreases in contributions of $.5 million in the Golf Course Fund. Expenses The City’s business-type activity expenses increased by $1.1 million (11.4%) primarily due to increased operating expenses and pension adjustments in the Water and Sewerage Fund. 53 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 13 FINANCIAL ANALYSIS OF THE CITY’S FUNDS Governmental Funds At April 30, 2023, the governmental funds (as presented on the balance sheet) reported a combined fund balance of $94.1 million which is a $20.0 million (27.0%) increase from the beginning of the year ($74.1 million). This increase was largely driven by excess of revenues over expenditures in the General Fund, Motor Fuel Tax Fund and Laurel/Western Redevelopment TIF and decrease of revenue to the Park and Public Land Fund. In addition, the City issued $10.8 million in General Obligation Bonds on April 27, 2023, which is included in the increase to the Capital Improvement Fund. The City Council elected to transfer from the General Fund an additional $4.0 million of the FY23 operating surplus to the Capital Improvement Fund to provide additional funding for the synthetic turf project. The Motor Fuel Tax fund received additional funding from a Rebuild Illinois Grant received from the state. Of the total fund balance of $94.1 million, $<.1 million is not available for continuing City services and capital projects, and $62.5 million is restricted in its use. The unassigned fund balance for the total of all governmental funds is $31.2 million, which is a $2.3 million (7.9%) 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 $2.4 million or 8.3% from FY22 (from $29.0 million to $31.4 million). The General Fund revenues increased by $2.2 million (5.2%) due primarily to higher property taxes, investment income and intergovernmental revenues, including sales tax and income tax revenue offset by decreases in grants and contribution revenue. The General Fund expenditures increased by $1.7 million (4.8%) due to personnel costs. The excess of revenues over expenditures (before transfers) for FY23 of $7.2 million was $.5 million greater than FY22 $6.7 million. The other financing sources (uses) for FY23 of $4.8 million was lower than FY22 $6.1 million due to one-time revenues being transferred to other funds in FY22. Property taxes increased $.7 million, intergovernmental revenues increased $.2 million while grants and contributions decreased $.2 million due to the City receiving FEMA funding in FY22 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 2021 levy extension (FY23 revenue) allowed for a 2.5% increase as well as new equalized assessed valuation growth. General Fund expenditures increased overall due to personnel cost increases. General government increased 4.6%, highways and streets increased 6.9% (personnel; snow and ice control), public safety increased 3.7% and sanitation increased 3.8%. 54 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 14 Original Final General Fund Budget Budget Actual Revenues : Taxes $24.3 $24.3 $24.5 Intergovernmental 6.6 6.6 8.3 Other 8.8 8.8 11.5 Total 39.7 39.7 44.3 Expenditures and Transfers: Expenditures 41.8 42.3 37.1 Transfers (Net)1.3 1.0 4.8 Total 43.1 43.3 41.9 Change in Fund Balance ($3.4)($3.6) $2.4 Table 3 General Fund Budgetary Highlights (in millions) Actual General Fund revenues were higher than budgeted revenues by $4.6 million during FY23. The primary variance resulted from income tax, sales tax, investment income and building permits exceeding projections. Actual General Fund expenditures and transfers were lower than the final budget by $1.4 million. It is the City’s policy to add 10%, which is $3.9 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 $1.9 million to $2.4 million. The Parks and Recreation Fund revenues increased by $.5 million due to increased participation in Recreation Programs. Expenses increased by $.5 million due to increased participation in Recreation Programs . Total other financing sources (uses) remained constant at $26,800. The Capital Improvements Fund is reported as a Major Fund for FY23 and is used to account for revenues associated with City building and infrastructure projects. Fund balance of this fund increased by $15.1 million in FY23. Compared to FY22, revenue increased by $3.8 million due to increases in sales tax, grants and investment income offset by decreases in real estate transfer tax. Total expenditures increased by $5.4 million in the capital outlay category. This was primarily due to onetime Burr Oak Storm Water project. Transfers in of $4.6 million for FY23 consisted of one-time fund balance transfer of $4.0 million from the General Fund to provide funding for the synthetic turf project and the City issued $10.8 million in General Obligation Debt and received a premium of $1.4 million on the debt issue to fund the synthetic turf project that is budgeted in FY2024. 55 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 15 CAPITAL ASSETS 2022 2023 2022 2023 2022 2023 Land and Improvements $42.9 $42.9 $0.7 $0.7 $43.6 $43.6 Infrastructure - Land 66.7 66.7 66.7 66.7 Construction in Progress 0.1 0.4 0.9 0.0 1.0 0.4 Infrastructure 48.6 52.4 48.6 52.4 Buildings 16.2 15.6 7.4 6.4 23.6 22.0 Improvements 13.2 12.4 30.1 29.7 43.3 42.1 Machinery and Equipment 4.3 3.8 1.1 1.2 5.4 5.0 Sanitary Sewers 0.0 0.0 11.1 10.5 11.1 10.5 Total $192.0 $194.2 $51.3 $48.5 $243.3 $242.7 Activities Business-Type Activities Total Primary Government Table 4 Capital Assets at Year End - 2022 and 2023 Net of Depreciation (in millions) Governmental At the end of FY23, the City had a combined total of $242.7 million invested in a broad range of capital assets. This amount represents a net decrease (including additions and deductions) of $.6 million. The net decrease is attributable to a $2.2 million increase in governmental activities and a $2.8 million decrease in the business-type activities. The increase in the governmental activities was due to additions exceeding depreciation by $2.2 million. The decrease in business-type activities was due primarily to $2.8 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 $192.0 $51.3 $243.3 Additions Not Depreciable 0.3 0.0 0.3 Depreciable 7.3 1.5 8.8 Construction in Progress 0.4 (0.9)(0.5) Retirements Depreciable (1.3)0.0 (1.3) Depreciation (5.3)(3.4)(8.7) Retirements 0.8 0.0 0.8 Ending Balance $194.2 $48.5 $242.7 Change in Capital Assets (in millions) The Addition in Governmental Activities Depreciable assets of $7.3 million was primarily due to a one time storm water project. 56 CITY OF LAKE FOREST, ILLINOIS MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) APRIL 30, 2023 16 Debt Outstanding The City had $44.3 million of general obligation bonds outstanding at April 30, 2023. Of this amount $29.1 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 $4,657 and $3,866 if self-supporting debt is excluded. The City operated as a home rule community for FY23. 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, 2023, the City’s net pension liability is $68.1 million, an increase of $15.5 million compared to the $52.6 million balance as of April 30, 2022. Additional information regarding the net pension liability can be found in Note 4. As of April 30, 2023, the City’s OPEB liability is $1.8 million, a decrease of $.3 million compared to the $2.1 million balance as of April 30, 2022. 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 2022, the City’s annual average unemployment rate was estimated to be 3.5%, compared to 4.2% for Lake County and 4.6% for the State of Illinois. The City maintains a Aaa bond rating from Moody’s Investors Service. Additional Financial Information The City prepares a Popular Annual Financial Report (PAFR), which is based on information from the annual comprehensive financial report to provide an easily understandable report for those without a financial background. The report can be found on the City’s website www.cityoflakeforest.com under Financial Transparency. 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. 57 BASIC FINANCIAL STATEMENTS 58 City of Lake Forest Statement of Net Position April 30, 2023 Primary Government Component Unit Governmental Activities Business- Type Activities Total Lake Forest Library Assets and Deferred Outflows of Resources Assets Cash and cash equivalents $91,220,424 $13,435,535 $104,655,959 $7,695,677 Investments 13,744,960 -13,744,960 - Receivables (net): Property taxes 32,818,292 -32,818,292 4,654,873 Other taxes 364,671 -364,671 23,567 Accounts 1,660,364 1,569,864 3,230,228 - Loans 303,230 -303,230 - Other 7,245,638 208 7,245,846 22,493 Due from other governmental units 2,368,954 -2,368,954 - Internal balances (1,019,953)1,019,953 -- Inventories 605,975 96,173 702,148 - Prepaid items 1,085,577 62,225 1,147,802 - Due from fiduciary funds 76,877 -76,877 - Leases receivable 262,457 1,552,259 1,814,716 - Capital assets: Capital assets not being depreciated 110,044,065 743,649 110,787,714 718,500 Capital assets being depreciated, net of accumulated depreciation 84,116,914 47,774,968 131,891,882 2,373,292 Total assets 344,898,445 66,254,834 411,153,279 15,488,402 Deferred Outflows of Resources Deferred outflows related to pensions 19,063,135 1,336,332 20,399,467 1,046,536 Deferred outflows related to total OPEB liability 234,706 21,439 256,145 5,771 Total deferred outflows of resources 19,297,841 1,357,771 20,655,612 1,052,307 See notes to financial statements 17 59 City of Lake Forest Statement of Net Position April 30, 2023 Primary Government Component Unit Governmental Activities Business- Type Activities Total Lake Forest Library Liabilities, Deferred inflows of Resources and Net Position Liabilities Accounts payable $3,034,716 $276,942 $3,311,658 $75,415 Accrued liabilities 1,441,522 50,552 1,492,074 62,799 Accrued interest payable 245,874 126,450 372,324 - Deposits 1,397,268 -1,397,268 - Unearned revenue 5,421,596 414,096 5,835,692 - Due to fiduciary funds 73,960 -73,960 - Noncurrent liabilities: Due within one year 3,454,057 1,804,594 5,258,651 34,724 Due in more than one year 103,082,133 10,463,962 113,546,095 1,089,688 Total liabilities 118,151,126 13,136,596 131,287,722 1,262,626 Deferred Inflows of Resources Property taxes levied for future periods 32,818,292 -32,818,292 4,654,873 Deferred inflows related to pensions 556,102 8,196 564,298 6,384 Deferred inflows related to total OPEB liability 741,076 67,693 808,769 39,030 Deferred inflows related to leases 262,457 1,552,259 1,814,716 - Total deferred inflows of resources 34,377,927 1,628,148 36,006,075 4,700,287 Net Position Net investment in capital assets 169,967,523 37,912,290 207,879,813 3,091,792 Restricted for: Culture and recreation 4,681,617 -4,681,617 - Highways and streets 3,422,540 -3,422,540 - Public safety 1,822,079 -1,822,079 - Cemetery purposes 10,912,775 -10,912,775 - Affordable housing 2,374,792 -2,374,792 - Capital projects 25,812,569 -25,812,569 - Debt service 1,766,088 -1,766,088 - Unrestricted (9,092,750)14,935,571 5,842,821 7,486,004 Total net position $211,667,233 $52,847,861 $264,515,094 $10,577,796 See notes to financial statements 18 60 City of Lake Forest Statement of Activities Year Ended April 30, 2023 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 $15,254,047 $4,219,903 $182,715 $3,058,736 $(7,792,693)$-$(7,792,693)$- Highway and streets 7,992,398 2,885,458 790,645 212,815 (4,103,480)-(4,103,480)- Sanitation 2,980,137 1,053,425 --(1,926,712)-(1,926,712)- Culture and recreation 12,433,798 3,178,479 257,085 -(8,998,234)-(8,998,234)- Public safety 22,900,489 2,897,404 28,869 86,137 (19,888,079)-(19,888,079)- Interest on long-term debt 477,955 ---(477,955)-(477,955)- Total governmental activities 62,038,824 14,234,669 1,259,314 3,357,688 (43,187,153)-(43,187,153)- Business-type activities: Waterworks and Sewerage 8,456,249 8,778,538 ---322,289 322,289 - Deerpath Golf Course 2,259,135 1,861,913 138,517 --(258,705)(258,705)- Total business-type activities 10,715,384 10,640,451 138,517 --63,584 63,584 - Total primary government $72,754,208 $24,875,120 $1,397,831 $3,357,688 (43,187,153)63,584 (43,123,569)- Component Unit Lake Forest Library $3,989,320 $38,738 $117,279 $----(3,833,303) General Revenues Taxes: Property 33,144,358 -33,144,358 4,463,978 Home rule sales 2,033,255 -2,033,255 - Utility 2,565,125 -2,565,125 - Real estate transfer 2,125,930 -2,125,930 - Other 572,628 -572,628 - Intergovernmental, unrestricted: Sales 3,276,837 -3,276,837 - Income 3,774,572 -3,774,572 - Telecommunication 677,612 -677,612 - Replacement 445,370 -445,370 117,016 Other 1,615,329 261,369 1,876,698 - Investment income 2,778,603 497,116 3,275,719 307,550 Gain (loss) on sale of assets 7,000 -7,000 - Total general revenues 53,016,619 758,485 53,775,104 4,888,544 Transfers (58,796)58,796 -- Total general revenues and transfers 52,957,823 817,281 53,775,104 4,888,544 Change in net position 9,770,670 880,865 10,651,535 1,055,241 Net Position, Beginning 201,896,563 51,966,996 253,863,559 9,522,555 Net Position, Ending $211,667,233 $52,847,861 $264,515,094 $10,577,796 See notes to financial statements 19 61 City of Lake Forest Balance Sheet Governmental Funds April 30, 2023 General Parks and Recreation Capital Improvements Nonmajor Governmental Funds Total Assets Cash and cash equivalents $32,156,964 $2,995,857 $35,683,242 $12,680,612 $83,516,675 Investments --4,850,113 8,894,847 13,744,960 Receivables (net): Property taxes 22,202,061 6,773,378 1,872,271 1,970,582 32,818,292 Other taxes 364,671 ---364,671 Accounts 1,367,031 266,307 27,026 -1,660,364 Loans 303,230 ---303,230 Other 155,000 -49,732 1,275,836 1,480,568 Due from other governments 1,664,436 41,541 594,170 68,807 2,368,954 Due from other funds -125,000 --125,000 Due from fiduciary funds ---76,877 76,877 Inventories 91,044 ---91,044 Prepaid items 108,009 -244,000 48,047 400,056 Lease receivable 262,457 ---262,457 Total assets $58,674,903 $10,202,083 $43,320,554 $25,015,608 $137,213,148 Liabilities, Deferred Inflows of Resources and Fund Balances Liabilities Accounts payable $665,796 $192,273 $1,134,149 $76,975 $2,069,193 Accrued liabilities 771,206 91,171 -13,410 875,787 Deposits 1,346,495 4,773 28,000 18,000 1,397,268 Unearned revenue 1,996,022 751,129 2,669,038 -5,416,189 Due to fiduciary funds 73,960 ---73,960 Total liabilities 4,853,479 1,039,346 3,831,187 108,385 9,832,397 Deferred Inflows of Resources Property taxes levied for a future period 22,202,061 6,773,378 1,872,271 1,970,582 32,818,292 Unavailable revenues -14,025 148,837 -162,862 Deferred inflows related to leases 262,457 ---262,457 Total deferred inflows of resources 22,464,518 6,787,403 2,021,108 1,970,582 33,243,611 Fund Balances Nonspendable 199,053 -244,000 48,047 491,100 Restricted -2,375,334 37,224,259 22,888,594 62,488,187 Unassigned 31,157,853 ---31,157,853 Total fund balances 31,356,906 2,375,334 37,468,259 22,936,641 94,137,140 Total liabilities, deferred inflows of resources and fund balances $58,674,903 $10,202,083 $43,320,554 $25,015,608 $137,213,148 See notes to financial statements 20 62 City of Lake Forest Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position April 30, 2023 Total Fund Balances, Governmental Funds $94,137,140 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. 194,160,979 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.162,862 Deferred outflows of resources related to pensions do not relate to current financial resources and are not reported in the governmental funds.19,063,135 Less amount reported in the internal service fund below.(417,436) Deferred inflows of resources related to pensions do not relate to current financial resources and are not reported in the governmental funds.(556,102) Less amount reported in the internal service fund below.2,557 Deferred outflows of resources related to total OPEB liability do not relate to current financial resources and are not reported in the governmental funds.234,706 Less amount reported in the internal service fund below.(6,650) Deferred inflows of resources related to total OPEB liability do not relate to current financial resources and are not reported in the governmental funds.(741,076) Less amount reported in the internal service fund below.20,996 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 (33,769,246) Compensated absences (2,124,098) Accrued interest (245,874) Unamortized debt premium (2,036,925) Net pension liabilities (66,902,688) Total OPEB liability (1,703,233) Less internal service fund long-term liabilities 467,540 Internal service funds are reported in the statement of net position as governmental activities.11,920,646 Net Position of Governmental Activities $211,667,233 See notes to financial statements 21 63 City of Lake Forest Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds Year Ended April 30, 2023 General Parks and Recreation Capital Improvements Nonmajor Governmental Funds Total Revenues Taxes: Property $21,510,462 $6,527,772 $1,540,184 $3,565,940 $33,144,358 Other taxes 3,041,753 -4,207,185 48,000 7,296,938 Intergovernmental 8,305,052 140,901 -1,004,328 9,450,281 Licenses and permits 3,661,327 ---3,661,327 Fines, forfeitures and penalties 252,955 ---252,955 Charges for services 4,902,115 3,014,446 154,211 2,015,079 10,085,851 Grants and contributions 33,501 262,635 2,780,850 418,357 3,495,343 Investment income 1,256,067 133,324 789,470 354,384 2,533,245 Miscellaneous revenues 1,392,402 56,416 36,775 72,271 1,557,864 Total revenues 44,355,634 10,135,494 9,508,675 7,478,359 71,478,162 Expenditures Current: General government 11,368,185 -878,694 1,014,876 13,261,755 Highways and streets 3,109,450 -2,380,075 -5,489,525 Sanitation 2,748,531 -4,050 -2,752,581 Culture and recreation -9,361,809 -761,863 10,123,672 Public safety 19,707,053 --420,917 20,127,970 Capital outlay 178,226 252,733 7,938,205 602,686 8,971,850 Debt service: Principal retirement ---2,192,956 2,192,956 Interest and fiscal charges --155,964 769,126 925,090 Total expenditures 37,111,445 9,614,542 11,356,988 5,762,424 63,845,399 Excess (deficiency) of revenues over expenditures 7,244,189 520,952 (1,848,313)1,715,935 7,632,763 Other Financing Sources (Uses) Transfers in -23,091 4,550,000 1,527,934 6,101,025 Transfers out (4,851,008)(50,000)-(1,260,688)(6,161,696) Proceeds from capital asset sales -70 265,641 -265,711 General obligation bonds issued --10,770,000 -10,770,000 Premium on debt issued --1,390,156 -1,390,156 Total other financing sources (uses)(4,851,008)(26,839)16,975,797 267,246 12,365,196 Net change in fund balances 2,393,181 494,113 15,127,484 1,983,181 19,997,959 Fund Balances, Beginning 28,963,725 1,881,221 22,340,775 20,953,460 74,139,181 Fund Balances, Ending $31,356,906 $2,375,334 $37,468,259 $22,936,641 $94,137,140 See notes to financial statements 22 64 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, 2023 Net Change in Fund Balances, Total Governmental Funds $19,997,959 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 7,984,924 Depreciation is reported in the government-wide financial statements (5,314,801) Retirement of capital assets (547,287) 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 137,700 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 (10,770,000) Principal repaid 2,192,956 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 (1,001,884) 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 13,980 Accrued interest on debt 59,017 Amortization of deferred charge on refunding (151) Net pension asset (12,844,903) Deferred outflows of resources related to pensions 10,806,989 Deferred inflows of resources related to pensions 13,504,772 Net pension liability (14,270,298) Deferred outflows of resources related to OPEB Liability (32,882) Deferred inflows of resources related to OPEB Liability (241,761) Total OPEB liability 246,606 Less amount reported in internal service funds below 24,757 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 (175,023) Change in Net Position of Governmental Activities $9,770,670 See notes to financial statements 23 65 City of Lake Forest Statement of Net Position Proprietary Funds April 30, 2023 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 $12,926,407 $509,128 $13,435,535 $7,703,749 Receivables: Accounts 1,521,792 48,072 1,569,864 - Other 208 -208 5,765,070 Inventories -96,173 96,173 514,931 Prepaid items -62,225 62,225 685,521 Lease receivable 100,463 -100,463 - Total current assets 14,548,870 715,598 15,264,468 14,669,271 Noncurrent assets: Lease receivable 1,451,796 -1,451,796 - Capital assets: Capital assets not being depreciated 648,132 95,517 743,649 - Capital assets being depreciated 117,382,216 6,168,840 123,551,056 48,047 Less accumulated depreciation (71,478,850)(4,297,238)(75,776,088)(48,047) Total noncurrent assets 48,003,294 1,967,119 49,970,413 - Total assets 62,552,164 2,682,717 65,234,881 14,669,271 Deferred Outflows of Resources Deferred outflows related to pensions 1,304,747 31,585 1,336,332 417,436 Deferred outflows related to total OPEB liability 21,084 355 21,439 6,650 Total deferred outflows of resources 1,325,831 31,940 1,357,771 424,086 See notes to financial statements 24 66 City of Lake Forest Statement of Net Position Proprietary Funds April 30, 2023 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 $196,287 $80,655 $276,942 $965,523 Accrued liabilities 33,140 17,412 50,552 565,735 Accrued interest payable 124,792 1,658 126,450 - Unearned revenue 13,707 400,389 414,096 5,407 Due to other funds -125,000 125,000 - General obligation bonds 1,698,588 87,778 1,786,366 - Compensated absences 4,981 19 5,000 - Total OPEB liability 13,009 219 13,228 4,103 Total current liabilities 2,084,504 713,130 2,797,634 1,540,768 Noncurrent liabilities: Long-term debt: General obligation debt payable 8,819,961 -8,819,961 - Compensated absences 270,915 8,076 278,991 37,782 Net pension liability 1,201,768 20,890 1,222,658 381,503 Total OPEB liability 139,994 2,358 142,352 44,152 Total noncurrent liabilities 10,432,638 31,324 10,463,962 463,437 Total liabilities 12,517,142 744,454 13,261,596 2,004,205 Deferred Inflows of Resources Deferred inflows related to pensions 8,056 140 8,196 2,557 Deferred inflows related to total OPEB liability 66,572 1,121 67,693 20,996 Deferred inflows related to leases 1,552,259 -1,552,259 - Total deferred inflows of resources 1,626,887 1,261 1,628,148 23,553 Net Position Net investment in capital assets 36,032,949 1,879,341 37,912,290 - Unrestricted 13,701,017 89,601 13,790,618 13,065,599 Total net position $49,733,966 $1,968,942 51,702,908 $13,065,599 Adjustments to reflect the consolidation of internal service funds activities related to enterprise funds 1,144,953 Net position business-type activities $52,847,861 See notes to financial statements 25 67 City of Lake Forest Statement of Revenues, Expenses and Changes in Net Position Proprietary Funds Year Ended April 30, 2023 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 $8,873,155 $1,861,913 $10,735,068 $9,044,565 Connection fees 157,192 -157,192 - Miscellaneous 1,470 -1,470 - Total operating revenues 9,031,817 1,861,913 10,893,730 9,044,565 Operating Expenses General and administrative 2,594,801 759,176 3,353,977 9,503,860 Operations and maintenance 2,539,800 1,142,760 3,682,560 - Depreciation and amortization 3,009,063 354,596 3,363,659 - Total operating expenses 8,143,664 2,256,532 10,400,196 9,503,860 Operating income (loss)888,153 (394,619)493,534 (459,295) Nonoperating Revenues (Expenses) Investment income 483,187 13,929 497,116 245,358 Other -8,090 8,090 - Interest expense (277,982)746 (277,236)- Grants and contributions -138,517 138,517 - Paying agent fees (905)(8)(913)- Total nonoperating revenues (expenses)204,300 161,274 365,574 245,358 Income (loss) before contributions and transfers 1,092,453 (233,345)859,108 (213,937) Contributions and Transfers Transfers in 8,796 50,000 58,796 1,875 Total contributions and transfers 8,796 50,000 58,796 1,875 Change in net position 1,101,249 (183,345)917,904 (212,062) Net Position, Beginning 48,632,717 2,152,287 50,785,004 13,277,661 Net Position, Ending $49,733,966 $1,968,942 51,702,908 $13,065,599 Adjustment to change in net position to reflect the consolidation of internal service funds activities related to enterprise funds (37,039) Change in net position of business-type activities $880,865 See notes to financial statements 26 68 City of Lake Forest Statement of Cash Flows Proprietary Funds Year Ended April 30, 2023 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 $9,009,774 $2,024,595 $11,034,369 $9,022,342 Paid to suppliers for goods and services (2,557,994)(1,086,529)(3,644,523)(9,216,727) Paid to employees for services (2,511,043)(755,309)(3,266,352)(554,436) Net cash flows from operating activities 3,940,737 182,757 4,123,494 (748,821) Cash Flows From Investing Activities Investment income 483,187 13,929 497,116 245,358 Net cash flows from investing activities 483,187 13,929 497,116 245,358 Cash Flows From Noncapital Financing Activities Transfers from (to) other funds 8,796 50,000 58,796 1,875 Net cash flows from noncapital financing activities 8,796 50,000 58,796 1,875 Cash Flows From Capital and Related Financing Activities Principal paid (1,888,607)(87,645)(1,976,252)- Interest paid (424,770)(8,770)(433,540)- Acquisition and construction of capital assets (498,973)(96,682)(595,655)- Other -8,090 8,090 - Other, paying agent fees (905)(8)(913)- Net cash flows from capital and related financing activities (2,813,255)(185,015)(2,998,270)- Net change in cash and cash equivalents 1,619,465 61,671 1,681,136 (501,588) Cash and Cash Equivalents, Beginning 11,306,942 447,457 11,754,399 8,205,337 Cash and Cash Equivalents, Ending $12,926,407 $509,128 $13,435,535 $7,703,749 See notes to financial statements 27 69 City of Lake Forest Statement of Cash Flows Proprietary Funds Year Ended April 30, 2023 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)$888,153 $(394,619)$493,534 $(459,295) Nonoperating revenue -138,517 138,517 - Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation 3,009,063 354,596 3,363,659 - Changes in assets and liabilities: Accounts receivable (17,102)(46,580)(63,682)(27,630) Inventories -(5,957)(5,957)(16,660) Prepaid items -104,293 104,293 62,666 Net pension asset 1,201,768 32,978 1,234,746 623,708 Deferred outflows related to pensions (1,076,597)(19,664)(1,096,261)(340,265) Deferred outflows related to OPEB 3,405 51 3,456 1,322 Accounts payable (18,194)(42,105)(60,299)41,947 Accrued liabilities ---(380,013) Accrued salaries 1,245 3,359 4,604 - Net pension liability 1,924,038 20,890 1,944,928 381,503 Deferred inflows related to pensions (1,975,333)(33,854)(2,009,187)(640,391) Deferred inflows related to OPEB 20,877 364 21,241 6,120 Deferred revenue (4,941)70,745 65,804 5,407 Compensated absences 9,793 125 9,918 2,596 Total OPEB liability (25,438)(382)(25,820)(9,836) Net cash flows from operating activities $3,940,737 $182,757 $4,123,494 $(748,821) Noncash Capital and Related Financing Activities None See notes to financial statements 28 70 City of Lake Forest Statement of Fiduciary Net Position Fiduciary Funds April 30, 2023 Private Purpose Trust Fund Pension Trust Funds Assets Cash $-$657,370 Money markets 42,260 - Investments: Equity securities 362,725 - Mutual funds 301,756 - Illinois police officers' pension investment fund -43,349,372 Illinois firefighters' pension investment fund -46,040,951 Prepaid items -7,343 Due from primary government -73,960 Total assets 706,741 90,128,996 Liabilities Accounts payable -1,495 Due to primary government 76,877 - Total liabilities 76,877 1,495 Net Position Restricted for pension benefits -90,127,501 Restricted for other purposes 629,864 - Total net position $629,864 $90,127,501 See notes to financial statements 29 71 City of Lake Forest Statement of Changes in Fiduciary Net Position Fiduciary Funds Year Ended April 30, 2023 Private Purpose Trust Fund Pension Trust Funds Additions Contributions: Employer $-$6,092,357 Employee -865,396 Total contributions -6,957,753 Investment income (loss): Interest 13,587 684,836 Net appreciation (depreciation) in fair value of investments (27,502)165,218 Total investment income (loss)(13,915)850,054 Less investment expense -(95,999) Net investment income (loss)(13,915)754,055 Miscellaneous -(970) Total additions (13,915)7,710,838 Deductions Pension benefits and refunds -6,976,597 Other administrative expenses 38,164 94,629 Total deductions 38,164 7,071,226 Change in fiduciary net position (52,079)639,612 Net Position, Beginning 681,943 89,487,889 Net Position, Ending $629,864 $90,127,501 See notes to financial statements 30 72 City of Lake Forest Index to Notes to Financial Statements April 30, 2023 Page 1.Summary of Significant Accounting Policies 32 Reporting Entity 32 Government-W ide and Fund Financial Statements 33 Measurement Focus, Basis of Accounting and Financial Statement Presentation 36 Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources and Net Position or Equity 37 Deposits and Investments 37 Receivables 41 Inventories and Prepaid Items 41 Capital Assets 41 Deferred Outflows of Resources 42 Compensated Absences 42 Long-Term Obligations 42 Leases 43 Deferred Inflows of Resources 43 Equity Classifications 43 2.Stewardship, Compliance and Accountability 44 Budgetary Information 44 Excess Expenditures Over Budget 45 3.Detailed Notes on All Funds 46 Deposits and Investments 46 Receivables 49 Capital Assets 50 Interfund Receivables/Payables and Transfers 52 Long-Term Obligations 53 Lease Disclosures 55 Net Position/Fund Balances 55 4.Other Information 56 Employees' Retirement System 56 Risk Management 72 Joint Ventures 74 Other Postemployment Benefits 75 Laurel and W estern Tax Increment Financing (TIF) District 78 Effect of New Accounting Standards on Current-Period Financial Statements 79 31 73 City of Lake Forest Notes to Financial Statements April 30, 2023 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. 32 74 City of Lake Forest Notes to Financial Statements April 30, 2023 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 In June of 2017, the GASB issued Statement No. 87, Leases. This Statement requires the recognition of certain lease assets and liabilities for leases that previously were classified as operating leases and recognized as inflows of resources or outflows of resources based on the payment provisions of the contract. The standard establishes a single model for lease accounting based on the foundational principle that leases are financings of the right-to-use an underlying asset. Under the Statement, a lessee is required to recognize a lease liability and an intangible right-to-use lease asset and a lessor is required to recognize a lease receivable and a deferred inflow of resources, which enhances the relevance and consistency of information about the City’s leasing activities. This standard was implemented May 1, 2022. 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. 33 75 City of Lake Forest Notes to Financial Statements April 30, 2023 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. 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 Fund 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. Capital Projects Fund Capital Improvements Fund is used to account for revenues to be used to fund City building and infrastructure projects. 34 76 City of Lake Forest Notes to Financial Statements April 30, 2023 The City reports the following major enterprise fund: Enterprise Fund Waterworks and Sewerage Fund accounts for operations of the waterworks and sewerage system for the residents of the City. 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 General Cemetery 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 35 77 City of Lake Forest Notes to Financial Statements April 30, 2023 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 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. 36 78 City of Lake Forest Notes to Financial Statements April 30, 2023 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. 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; 37 79 City of Lake Forest Notes to Financial Statements April 30, 2023 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; 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 38 80 City of Lake Forest Notes to Financial Statements April 30, 2023 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. 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 Police Pension Fund and Firefighters' Pension Fund to pool their funds for investment purposes. During the year, the investments of the Police Pension Fund were transferred to Illinois Police Officers' Pension Investment Fund. In fiscal year 2022, the investments of the Firefighters' Pension Fund were transferred to the Illinois Firefighters' Pension Investment Fund. The Illinois Police Officers' Pension Investment Fund and the Illinois Firefighters' Pension Investment Fund are external investment pools 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 Illinois Police Officers' Pension Investment Fund 100.00 % 3.90 % 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. 39 81 City of Lake Forest Notes to Financial Statements April 30, 2023 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. 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 Fund's investment policy further limits the investment in any one company or issuer to 5% of the funds' total assets and 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. Custodial Credit Risk, Investments The investment policies for the City, Cemetery and Pension Funds require investment securities be held by an authorized custodial bank pursuant to a written custodial agreement. 40 82 City of Lake Forest Notes to Financial Statements April 30, 2023 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 2022 attaches as an enforceable lien on January 1, 2022, 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 2023 tax levy, which attached as an enforceable lien on the property as of January 1, 2023, has not been recorded as a receivable as of April 30, 2023, as the tax has not yet been levied by the City and will not be levied until December 2023 and therefore, the levy is not measurable at April 30, 2023. Tax bills for levy year 2022 are prepared by Lake County and issued on or about May, 2023 and are payable in two installments, on or about June 1, 2023 and September 1, 2023 or within 30 days of the tax bills being issued. The County collects such taxes and remits them periodically. The 2022 property tax levy is recognized as a receivable and deferred inflows in fiscal 2023, net the 1.5% allowance for uncollectible. As the taxes become available to finance current expenditures, they are recognized as revenues. At April 30, 2023, the property taxes receivable and related deferred inflows consisted of the estimated amount collectible from the 2022 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. 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. 41 83 City of Lake Forest Notes to Financial Statements April 30, 2023 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. 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. 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. 42 84 City of Lake Forest Notes to Financial Statements April 30, 2023 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. Leases The City is a lessor because it leases capital assets to other entities. As a lessor, the City reports a lease receivable and corresponding deferred inflow of resources in both the fund financial statements and government-wide financial statements. The City continues to report and depreciate the capital assets being leased as capital assets of the primary government. 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. 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. 43 85 City of Lake Forest Notes to Financial Statements April 30, 2023 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. 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. 44 86 City of Lake Forest Notes to Financial Statements April 30, 2023 (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 Fund Budgeted Expenditures Actual Expenditures Excess Expenditures Over Budget Debt Service $2,964,323 $2,993,969 $29,646 45 87 City of Lake Forest Notes to Financial Statements April 30, 2023 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 $88,887,743 $89,780,263 Custodial Credit Risk, Deposits Mutual funds, other than bonds 1,593,051 1,593,051 N/A Negotiable certificates of deposit 4,850,113 4,850,113 Custodial Credit Risk, Investments, Credit Risk, Interest Rate Risk Illinois police officers' pension investment 43,349,372 43,349,372 Custodial Credit Risk, Investments, Credit Risk Illinois firefighters' pension investment 46,040,951 46,040,951 Custodial Credit Risk, Investments, Credit Risk Illinois funds 24,152,198 24,152,198 Credit Risk Equity securities 5,555,949 5,555,949 Custodial Credit Risk, Investments, Foreign Currency Risk Mutual funds, bond funds 2,410,328 2,410,328 Credit Risk, Interest Rate Risk Petty cash 11,325 - Total deposits and investments $216,851,030 $217,732,225 Reconciliation to financial statements Per statement of net position: Cash and cash equivalents, primary government $104,655,959 Investments, primary government 13,744,960 Cash and cash equivalents, Lake Forest Library 7,695,677 Per statement of net position, fiduciary funds: Private Purpose Trust, money markets 42,260 Private Purpose Trust, equity securities 362,725 Private Purpose Trust, mutual funds 301,756 Pension Trusts, cash 657,370 Pension Trusts, Illinois police officers' pension investment fund 43,349,372 Pension Trusts, Illinois firefighters' pension investment fund 46,040,951 Total deposits and investments $216,851,030 46 88 City of Lake Forest Notes to Financial Statements April 30, 2023 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.Deposits in the credit union are insured by the National Credit Union Administration in the amount of $250,000 for all share draft accounts and $250,000 for all share certificate and regular share 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. 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 investments in the Illinois police officers' pension investment fund and the Illinois firefighters' pension investment fund are measured at the net asset value. City Ap ril 30, 2023 Investment Type Level 1 Level 2 Level 3 Total Mutual funds, other than bond funds $1,459,903 $-$-$1,459,903 Negotiable certificates of deposit -4,850,113 -4,850,113 Equity securities 5,193,224 --5,193,224 Mutual funds, bond funds 2,241,720 --2,241,720 Total $8,894,847 $4,850,113 $-$13,744,960 Private Purpose Trust Ap ril 30, 2023 Investment Type Level 1 Level 2 Level 3 Total Mutual funds, other than bond funds $133,148 $-$-$133,148 Equity securities 362,725 --362,725 Mutual funds, bond funds 168,608 --168,608 Total $664,481 $-$-$664,481 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. The City does not have any deposits exposed to custodial credit risk. 47 89 City of Lake Forest Notes to Financial Statements April 30, 2023 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, 2023, the investments were rated as follows: Investment Type Standard & Poors Moody's Investors Services Illinois funds AAAm Not rated Negotiable certificates of deposit Not rated Not rated Mutual funds, bond funds Not rated Not rated Illinois firefighters' pension investment fund Not rated Not rated Illinois police officers' 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, 2023, investments were as follows: City Maturity (In Years) Investment Type Fair Value Less Than One Year 1 - 5 Years 6-10 Years More than 10 years Negotiable certificates of deposit $4,850,113 $2,662,789 $2,187,324 $-$- Mutual funds, bond funds 2,241,720 2,241,720 --- Total $7,091,833 $4,904,509 $2,187,324 $-$- Private Purpose Trust Maturity (In Years) Investment Type Fair Value Less than One Year 1 - 5 Years 6 - 10 Years More Than 10 Years Mutual funds, bond funds $168,608 $168,608 $-$-$- Total $168,608 $168,608 $-$-$- 48 90 City of Lake Forest Notes to Financial Statements April 30, 2023 Money-Weighted Rate of Return Police Pension Fund For the year ended April 30, 2023, the annual money-weighted rate of return on the Police Pension plan investments, net of pension plan investment expense, was 0.56%. The money- weighted rate of return expresses investment performance, net of investment expense, adjusted for the changing amounts actually invested. Firefighters' Pension Fund For the year ended April 30, 2023, the annual money-weighted rate of return on the Firefighters' Pension plan investments, net of pension plan investment expense, was 1.15%. 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 with the exception of the lease receivable. 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 $1,035,185 Grants 2,817,876 Recreation fees 765,164 Parking ticket fees 442,737 Miscellaneous 355,227 Total unearned revenue for governmental funds $5,416,189 49 91 City of Lake Forest Notes to Financial Statements April 30, 2023 Capital Assets Capital asset activity for the year ended April 30, 2023, was as follows: Beginning Balance Additions Deletions Ending Balance Governmental Activities Capital assets not being depreciated: Land and land improvements $42,907,800 $282,219 $297,466 $42,892,553 Infrastructure, land 66,740,770 --66,740,770 Construction in progress 19,560 391,182 -410,742 Total capital assets not being depreciated 109,668,130 673,401 297,466 110,044,065 Capital assets being depreciated: Infrastructure 188,294,958 6,151,242 447,764 193,998,436 Buildings 30,576,659 --30,576,659 Improvements other than buildings 35,273,351 462,633 1,000 35,734,984 Machinery and equipment 21,305,057 697,648 525,477 21,477,228 Total capital assets being depreciated 275,450,025 7,311,523 974,241 281,787,307 Total capital assets 385,118,155 7,984,924 1,271,707 391,831,372 Less accumulated depreciation for: Infrastructure $(139,709,106)$(2,236,584)$316,880 $(141,628,810) Buildings (14,360,811)(672,594)-(15,033,405) Improvements other than buildings (22,055,435)(1,240,039)1,000 (23,294,474) Machinery and equipment (16,954,660)(1,165,584)406,540 (17,713,704) Total accumulated depreciation (193,080,012)(5,314,801)724,420 (197,670,393) Net capital assets being depreciated 82,370,013 1,996,722 249,821 84,116,914 Total governmental activities capital assets, net of accumulated depreciation $192,038,143 $2,670,123 $547,287 $194,160,979 Depreciation expense was charged to functions as follows: Governmental Activities General government $776,402 Highways and streets 2,926,650 Sanitation 111,657 Culture and recreation 1,018,365 Public safety 481,727 Total governmental activities depreciation expense $5,314,801 50 92 City of Lake Forest Notes to Financial Statements April 30, 2023 Beginning Balance Additions Deletions Ending Balance Business-Type Activities Capital assets not being depreciated: Land $743,649 $-$-$743,649 Construction in progress 874,375 130,214 1,004,589 - Total capital assets not being depreciated 1,618,024 130,214 1,004,589 743,649 Capital assets being depreciated: Buildings 27,020,235 --27,020,235 Improvements other than buildings 58,381,458 1,016,489 3,026 59,394,921 Machinery and equipment 5,639,948 453,541 15,343 6,078,146 Sanitary sewers and related property 31,057,754 --31,057,754 Total capital assets being depreciated 122,099,395 1,470,030 18,369 123,551,056 Total capital assets 123,717,419 1,600,244 1,022,958 124,294,705 Less accumulated depreciation for: Buildings (19,616,708)(1,003,573)-(20,620,281) Improvements other than buildings (28,279,723)(1,429,918)3,026 (29,706,615) Machinery and equipment (4,531,388)(389,194)15,343 (4,905,239) Sanitary sewers and related property (20,002,979)(540,974)-(20,543,953) Total accumulated depreciation (72,430,798)(3,363,659)18,369 (75,776,088) Net capital assets being depreciated 49,668,597 (1,893,629)-47,774,968 Business-type capital assets, net of accumulated depreciation $51,286,621 $(1,763,415)$1,004,589 $48,518,617 Component Unit Capital assets not being depreciated: Land $70,000 $-$-$70,000 Construction in progress -480,000 -480,000 Art 168,500 --168,500 Total capital assets not being depreciated 238,500 480,000 -718,500 Capital assets being depreciated: Buildings 1,180,907 --1,180,907 Improvements other than buildings 2,271,091 --2,271,091 Machinery and equipment 3,756,490 491,244 357,507 3,890,227 Total capital assets being depreciated 7,208,488 491,244 357,507 7,342,225 Total capital assets 7,446,988 971,244 357,507 8,060,725 Less accumulated depreciation for: Buildings (806,355)(19,713)-(826,068) Improvements other than buildings (1,733,671)(62,827)-(1,796,498) Machinery and equipment (2,356,980)(337,426)348,039 (2,346,367) Total accumulated depreciation (4,897,006)(419,966)348,039 (4,968,933) Net capital assets being depreciated 2,311,482 71,278 9,468 2,373,292 Total component units capital assets, net of accumulated depreciation $2,549,982 $551,278 $9,468 $3,091,792 51 93 City of Lake Forest Notes to Financial Statements April 30, 2023 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 (1,144,953) Total internal balances, government-wide statement of net position $(1,019,953) 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. Transfers The following is a schedule of interfund transfers: Fund Transferred To Fund Transferred From Am ount Principal Purpose Parks and Recreation General $23,091 Funding for budgeted salary amounts Capital Improvement General 4,550,000 Funding for capital outlay projects Nonmajor Government General 267,246 Funding for debt service and budgeted salary amounts Nonmajor Government Nonmajor Government 1,260,688 Funding for debt service payment Waterworks and Sewerage General 8,796 Funding for budgeted salary amounts Nonmajor Enterprise Parks and Recreation 50,000 Funding for debt service payment Internal Service General 1,875 Funding for budgeted salary amounts Total, fund financial statements 6,161,696 Less government-wide eliminations (6,102,900) Total transfers, government-wide statement of activities $58,796 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. 52 94 City of Lake Forest Notes to Financial Statements April 30, 2023 Long-Term Obligations Long-term obligations activity for the year ended April 30, 2023, was as follows: Beginning Balance Increases Decreases Ending Balance Am ounts Due Within One Year Governmental Activities Bonds and notes payable: General obligation debt $25,192,203 $10,770,000 $2,192,957 $33,769,246 $3,144,246 Premiums 1,035,041 1,390,156 388,272 2,036,925 - Total bonds and notes payable 26,227,244 12,160,156 2,581,229 35,806,171 3,144,246 Other liabilities: Compensated absences 2,138,078 2,527,030 2,541,010 2,124,098 165,000 Total OPEB liability 1,949,839 -246,606 1,703,233 144,811 Net pension liability 52,632,390 14,270,298 -66,902,688 - Total other liabilities 56,720,307 16,797,328 2,787,616 70,730,019 309,811 Total governmental activities long- term liabilities $82,947,551 $28,957,484 $5,368,845 $106,536,190 $3,454,057 Business-Type Activities Bonds and notes payable: General obligation debt $12,542,618 $-$1,976,252 $10,566,366 $1,786,366 Premium 159,147 -119,186 39,961 - Total bonds and notes payable 12,701,765 -2,095,438 10,606,327 1,786,366 Other liabilities: Compensated absences 274,073 219,627 209,709 283,991 5,000 Total OPEB liability 181,400 -25,820 155,580 13,228 Net pension liability -1,222,658 -1,222,658 - Total other liabilities 455,473 1,442,285 235,529 1,662,229 18,228 Total business-type activities long- term liabilities $13,157,238 $1,442,285 $2,330,967 $12,268,556 $1,804,594 Component Unit Other liabilities: Compensated absences $99,027 $161,605 $160,101 $100,531 $5,000 Financed purchase 13,309 -13,309 -- Total OPEB liability 129,493 -58,020 71,473 29,724 Net pension liability -952,408 -952,408 - Total other liabilities 241,829 1,114,013 231,430 1,124,412 34,724 Total component units long-term liabilities $241,829 $1,114,013 $231,430 $1,124,412 $34,724 53 95 City of Lake Forest Notes to Financial Statements April 30, 2023 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, 2023 Special Service Area 29 12/20/2004 12/15/2023 2.55-3.65%$2,000,000 $150,612 2015 Series 8/3/2015 12/15/2036 2.50-3.75%9,780,000 8,065,000 2019 Series Refunding 12/19/2019 12/15/2032 2.00-5.00%10,751,022 7,738,634 2021 Series Refunding 9/15/2021 12/15/2032 2.00%7,590,000 7,045,000 2023 Series 4/27/2023 12/15/2033 5.00%10,770,000 10,770,000 Total governmental activities, general obligation debt $33,769,246 Business-Type Activities General Obligation Debt Date of Issue Final Maturity Interest Rates Original Indebtedness Balance April 30, 2023 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 1,271,366 Total business-type activities, general obligation debt $10,566,366 Debt service requirements to maturity are as follows: Governmental Activities Business-Type Activities General Obligation Debt General Obligation Debt Years Principal Interest Principal Interest 2024 $3,144,246 $991,891 $1,786,366 $334,721 2025 2,395,000 1,061,113 525,000 260,853 2026 2,500,000 968,988 535,000 247,728 2027 2,580,000 872,563 550,000 234,352 2028 2,695,000 772,263 565,000 220,603 2029-2033 16,690,000 2,422,813 3,055,000 864,628 2034-2038 3,765,000 225,600 3,550,000 368,900 Total $33,769,246 $7,315,231 $10,566,366 $2,531,785 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 net pension liability attributable to governmental activities will be liquidated primarily by the General Fund. 54 96 City of Lake Forest Notes to Financial Statements April 30, 2023 Lease Disclosures Lessor - Lease Receivables Governmental Activities Lease Receivables Description Date of Inception Final Maturity Interest Rates Receivable Balance Ap ril 30, 2023 Land rental 1/1/2014 12/31/2023 2.73%$41,974 Building rental 5/1/2019 4/30/2028 2.73%14,359 Building rental 6/1/2021 5/31/2030 2.73%52,379 Building rental 6/2/2021 6/1/2026 2.73%125,237 Building rental 4/1/2022 3/31/2027 2.73%28,508 Total governmental activities $262,457 Business-Type Activities Lease Receivables Description Date of Inception Final Maturity Interest Rates Receivable Balance Ap ril 30, 2023 Water tower lease 8/1/2018 7/30/2033 2.73%$627,190 Water tower lease 8/1/2020 7/31/2035 2.73%925,069 Total business-type activities $1,552,259 The City recognized $209,114 and $66,349 of lease revenue and interest revenue, respectively, during the fiscal year. Net Position/Fund Balances Net position reported on the government-wide statement of net position at April 30, 2023, includes the following: Governmental Activities Net investment in capital assets: Capital assets not being depreciated $110,044,065 Capital assets being depreciated, net of accumulated depreciation 84,116,914 Less long-term debt outstanding (33,769,246) Plus unspent capital related debt proceeds 11,612,715 Less unamortized debt premium (2,036,925) Total net investment in capital assets $169,967,523 55 97 City of Lake Forest Notes to Financial Statements April 30, 2023 Governmental Funds Governmental fund balances reported on the fund financial statements at April 30, 2023, include the following: General Fund Parks and Recreation Fund Capital Improvements Fund Nonmajor Governmental Funds Total Fund Balances Nonspendable: Prepaid items $108,009 $-$244,000 $48,047 $400,056 Inventories 91,044 ---91,044 Subtotal 199,053 -244,000 48,047 491,100 Restricted for: Culture and recreation -2,375,334 -2,292,258 4,667,592 Highway and streets ---3,422,540 3,422,540 Public safety, fire ---175,054 175,054 Public safety, police ---1,647,025 1,647,025 Cemetery perpetual care ---10,912,775 10,912,775 Affordable housing ---2,374,792 2,374,792 Capital projects --37,224,259 52,188 37,276,447 Debt service ---2,011,962 2,011,962 Subtotal -2,375,334 37,224,259 22,888,594 62,488,187 Unassigned:31,157,853 ---31,157,853 Total fund balances $31,356,906 $2,375,334 $37,468,259 $22,936,641 $94,137,140 Business-Type Activities Net investment in capital assets: Capital assets not being depreciated $743,649 Capital assets being depreciated, net of accumulated depreciation 47,774,968 Less long-term debt outstanding (10,566,366) Less unamortized debt premium (39,961) Total net investment in capital assets $37,912,290 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. 56 98 City of Lake Forest Notes to Financial Statements April 30, 2023 For the year ended April 30, 2023, 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 $111,095,509 $9,578,816 $10,470,758 $64,207 $1,586,835 Police Pension Plan 79,134,271 35,683,133 4,043,856 500,091 4,889,023 Firefighters' Pension Plan 69,539,760 22,863,397 5,884,853 -3,555,310 Total $259,769,540 $68,125,346 $20,399,467 $564,298 $10,031,168 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, 2022, the measurement date, membership in the plan was as follows: Retirees and beneficiaries 315 Inactive, nonretired members 203 Active members 198 Total 716 57 99 City of Lake Forest Notes to Financial Statements April 30, 2023 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 2022 was 8.40% 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, 2022 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, 2022 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. 58 100 City of Lake Forest Notes to Financial Statements April 30, 2023 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 %35.50 %7.82 %6.50 International equities 18.00 9.23 7.60 Fixed income 25.50 5.01 4.90 Real estate 10.50 7.10 6.20 Alternatives 9.50 Private equity 13.43 9.90 Hedge funds -- Commodities 7.42 6.25 Cash equivalents 1.00 4.00 4.00 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, 2021 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 $123,335,174 $111,095,509 $101,240,565 Plan fiduciary net position 101,516,693 101,516,693 101,516,693 Net pension liability/(asset)$21,818,481 $9,578,816 $(276,128) 59 101 City of Lake Forest Notes to Financial Statements April 30, 2023 1% Decrease Current Discount Rate 1% Increase Library: Total pension liability $15,655,241 $14,101,630 $12,850,717 Plan fiduciary net position 13,149,222 13,149,222 13,149,222 Net pension liability/(asset)$2,506,019 $952,408 $(298,505) Total: Total pension liability $138,990,415 $125,197,139 $114,091,282 Plan fiduciary net position 114,665,915 114,665,915 114,665,915 Net pension liability/(asset)$24,324,500 $10,531,224 $(574,633) Changes in Net Pension Liability/(Asset) The changes in net pension liability/(asset)for the calendar year ended December 31, 2022 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, 2021 $107,135,715 $121,937,634 $(14,801,919) Service cost 1,235,060 -1,235,060 Interest on total pension liability 7,784,121 -7,784,121 Differences between expected and actual experience of the total pension liability 1,265,540 -1,265,540 Change of assumptions (5,642)-(5,642) Benefit payments, including refunds of employee contributions (6,319,285)(6,319,285)- Contributions, employer -1,161,723 (1,161,723) Contributions, employee -638,230 (638,230) Net investment income -(16,214,595)16,214,595 Other (net transfer)-312,986 (312,986) Balances at December 31, 2022 $111,095,509 $101,516,693 $9,578,816 60 102 City of Lake Forest Notes to Financial Statements April 30, 2023 Increase (Decrease) Total Pension Liability (a) Plan Fiduciary Net Position (b) Net Pension Liability/(Asset) (a) - (b) Library: Balances at December 31, 2021 $13,701,711 $15,179,647 $(1,477,936) Service cost 122,800 -122,800 Interest on total pension liability 773,964 -773,964 Differences between expected and actual experience of the total pension liability 125,831 -125,831 Change of assumptions 5,642 -5,642 Benefit payments, including refunds of employee contributions (628,318)(628,318)- Contributions, employer -115,509 (115,509) Contributions, employee -63,458 (63,458) Net investment income -(1,612,194)1,612,194 Other (net transfer)-31,120 (31,120) Balances at December 31, 2022 $14,101,630 $13,149,222 $952,408 Total: Balances at December 31, 2021 $120,837,426 $137,117,281 $(16,279,855) Service cost 1,357,860 -1,357,860 Interest on total pension liability 8,558,085 -8,558,085 Differences between expected and actual experience of the total pension liability 1,391,371 -1,391,371 Benefit payments, including refunds of employee contributions (6,947,603)(6,947,603)- Contributions, employer -1,277,232 (1,277,232) Contributions, employee -701,688 (701,688) Net investment income -(17,826,789)17,826,789 Other (net transfer)-344,106 (344,106) Balances at December 31, 2022 $125,197,139 $114,665,915 $10,531,224 Plan fiduciary net position as a percentage of the total pension liability %91.59 61 103 City of Lake Forest Notes to Financial Statements April 30, 2023 Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions For the year ended April 30, 2023, the City and Library recognized pension expense of $1,586,835 and $157,777, 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 $1,535,351 $31,759 Assumption changes -32,448 Net difference between projected and actual earnings on pension plan investments 8,639,531 - Contributions subsequent to the measurement date 295,876 - Total $10,470,758 $64,207 Library: Difference between expected and actual experience $157,222 $3,158 Assumption changes -3,226 Net difference between projected and actual earnings on pension plan investments 859,016 - Contributions subsequent to the measurement date 30,298 - Total $1,046,536 $6,384 Total: Difference between expected and actual experience $1,692,573 $34,917 Assumption changes -35,674 Net difference between projected and actual earnings on pension plan investments 9,498,547 - Contributions subsequent to the measurement date 326,174 - Total $11,517,294 $70,591 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, 2024. The remaining amounts reported as deferred outflows and inflows of resources related to pensions is $11,120,529 and will be recognized in pension expense as follows: Year Ending December 31,City Library Total 2024 $406,608 $40,612 $447,220 2025 1,814,906 181,273 1,996,179 2026 2,870,403 286,696 3,157,099 2027 5,018,758 501,273 5,520,031 Total $10,110,675 $1,009,854 $11,120,529 62 104 City of Lake Forest Notes to Financial Statements April 30, 2023 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. 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, 2023, the Police Pension membership consisted of: Retirees and beneficiaries 48 Inactive, nonretired members 12 Active members 38 Total 98 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, 2023 was 86.28% of annual covered payroll. 63 105 City of Lake Forest Notes to Financial Statements April 30, 2023 Net Pension Liability/(Asset) The net pension liability/(asset) was measured as of April 30, 2023 and the total pension liability used to calculate the net pension liability/(asset) was determined by an annual actuarial valuation as of that date. 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, 2023 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 Pub-2010 Employee Mortality Table with generational improvement Scale MP- 2021. 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 Police Officers' Pension Investment Fund 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. 64 106 City of Lake Forest Notes to Financial Statements April 30, 2023 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 $90,517,834 $79,134,271 $69,895,192 Plan fiduciary net position 43,451,138 43,451,138 43,451,138 Net pension liability $47,066,696 $35,683,133 $26,444,054 Changes in Net Pension Liability/(Asset) The City's changes in net pension liability/(asset) for the year ended April 30, 2023 was as follows: Increase (Decrease) Total Pension Liability (a) Plan Fiduciary Net Position (b) Net Pension Liability/Asset (a) - (b) Balances at April 30, 2022 $75,529,445 $42,611,874 $32,917,571 Service cost 1,040,068 -1,040,068 Interest on total pension liability 4,857,058 -4,857,058 Differences between expected and actual experience of the total pension liability 1,398,788 -1,398,788 Benefit payments, including refunds of employee contributions (3,691,088)(3,691,088)- Contributions, employer -3,580,856 (3,580,856) Contributions, employee -515,034 (515,034) Net investment income -493,641 (493,641) Administration -(59,179)59,179 Balances at April 30, 2023 $79,134,271 $43,451,138 $35,683,133 Plan fiduciary net position as a percentage of the total pension liability %54.91 65 107 City of Lake Forest Notes to Financial Statements April 30, 2023 Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions For the year ended April 30, 2023, the City recognized pension expense of $4,889,023. 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 $1,530,462 $500,091 Assumption changes 637,119 - Net difference between projected and actual earnings on pension plan investments 1,876,275 - Total $4,043,856 $500,091 The amounts reported as deferred outflows and inflows of resources related to pensions is $3,543,765 and will be recognized in pension expense as follows: Year Ending April 30,Am ount 2024 $978,501 2025 373,886 2026 1,466,332 2027 725,046 Total $3,543,765 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. 66 108 City of Lake Forest Notes to Financial Statements April 30, 2023 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, 2023, the Firefighters' Pension Plan membership consisted of: Retirees and beneficiaries 45 Inactive, nonretired members 2 Active members 33 Total 80 Contributions Participants contribute a fixed percentage of their base salary to the plans. At April 30, 2023, 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, 2023 was 67.33% of annual covered payroll. Net Pension Liability/(Asset) The net pension liability/(asset) was measured as of April 30, 2023 and the total pension liability used to calculate the net pension liability/(asset) was determined by an annual actuarial valuation as of that date. 67 109 City of Lake Forest Notes to Financial Statements April 30, 2023 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, 2023 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 2.25% 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 Pub-2010 Employee Mortality Table with generational improvement Scale MP-2021. 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 Firefighters' Pension Investment Fund 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. 68 110 City of Lake Forest Notes to Financial Statements April 30, 2023 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 $79,389,656 $69,539,760 $61,514,224 Plan fiduciary net position 46,676,363 46,676,363 46,676,363 Net pension liability $32,713,293 $22,863,397 $14,837,861 Changes in Net Pension Liability/(Asset) The City's changes in net pension liability/(asset) for the year ended April 30, 2023 was as follows: Increase (Decrease) Total Pension Liability (a) Plan Fiduciary Net Position (b) Net Pension Liability/Asset (a) - (b) Balances at April 30, 2022 $66,590,834 $46,876,015 $19,714,819 Service cost 936,270 -936,270 Interest on total pension liability 4,282,483 -4,282,483 Differences between expected and actual experience of the total pension liability 894,144 -894,144 Change of assumptions 121,539 -121,539 Benefit payments, including refunds of employee contributions (3,285,510)(3,285,510)- Contributions, employer -2,511,501 (2,511,501) Contributions, employee -350,363 (350,363) Net investment income -259,444 (259,444) Administration -(35,450)35,450 Balances at April 30, 2023 $69,539,760 $46,676,363 $22,863,397 Plan fiduciary net position as a percentage of the total pension liability %67.12 69 111 City of Lake Forest Notes to Financial Statements April 30, 2023 Pension Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions For the year ended April 30, 2023, the City recognized pension expense of $3,555,310. 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 $1,462,253 $- Assumption changes 1,705,225 - Net difference between projected and actual earnings on pension plan investments 2,717,375 - Total $5,884,853 $- The amounts reported as deferred outflows and inflows of resources related to pensions is $5,884,853 and will be recognized in pension expense as follows: Year Ending April 30,Am ount 2024 $1,757,167 2025 891,861 2026 2,204,368 2027 862,179 2028 169,278 Total $5,884,853 70 112 City of Lake Forest Notes to Financial Statements April 30, 2023 Pension Segment Information Fiduciary Net Position Pension Trust Police Pension Firefighters' Pension Total Assets Cash $54,092 $603,278 $657,370 Investments: Illinois police officers' pension investment fund 43,349,372 -43,349,372 Illinois firefighters' pension investment fund -46,040,951 46,040,951 Prepaid items 1,523 5,820 7,343 Due from primary government 47,276 26,684 73,960 Total assets 43,452,263 46,676,733 90,128,996 Liabilities Accounts payable 1,125 370 1,495 Total liabilities 1,125 370 1,495 Net Position Restricted for pension benefits $43,451,138 $46,676,363 $90,127,501 71 113 City of Lake Forest Notes to Financial Statements April 30, 2023 Changes in Plan Net Position Pension Trust Police Pension Firefighters' Pension Total Additions Contributions: Employer $3,580,856 $2,511,501 $6,092,357 Employee 515,033 350,363 865,396 Total contributions 4,095,889 2,861,864 6,957,753 Investment income: Interest 219,212 465,624 684,836 Net appreciation (depreciation) in fair value of investments 332,539 (167,321)165,218 Total investment income 551,751 298,303 850,054 Less investment expense (59,925)(36,074)(95,999) Net investment income 491,826 262,229 754,055 Miscellaneous 1,816 (2,786)(970) Total additions 4,589,531 3,121,307 7,710,838 Deductions Pension benefits and refunds 3,691,088 3,285,509 6,976,597 Other administrative expenses 59,179 35,450 94,629 Total deductions 3,750,267 3,320,959 7,071,226 Change in net position 839,264 (199,652)639,612 Net Position, Beginning 42,611,874 46,876,015 89,487,889 Net Position, Ending $43,451,138 $46,676,363 $90,127,501 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. 72 114 City of Lake Forest Notes to Financial Statements April 30, 2023 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 2021-2022 $217,724 $166,981 $169,316 $215,389 2022-2023 215,389 343,970 352,680 206,679 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, 2023 and 2022 are as follows: Beginning of End of Fiscal Year Changes in Claim Fiscal Year Liability Estimates Payments Liability 2021-2022 $776,381 $6,452,051 $6,389,054 $839,378 2022-2023 839,378 5,424,344 5,837,093 426,629 73 115 City of Lake Forest Notes to Financial Statements April 30, 2023 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 for residents with physical and intellectual disabilities 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. 74 116 City of Lake Forest Notes to Financial Statements April 30, 2023 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, 2023, the following employees were covered by the benefit terms: City Library Inactive plan members or beneficiaries currently receiving benefit payments 23 3 Active plan members 201 19 Total 224 22 Total OPEB Liability The City's total OPEB liability of $1,858,813 was measured as of April 30, 2023 and was determined by an actuarial valuation as of that date.The Library's total OPEB liability of $71,473 was measured as of April 30, 2023 and was determined by an actuarial valuation as of that date. 75 117 City of Lake Forest Notes to Financial Statements April 30, 2023 Actuarial Assumptions and Other Inputs For both the City and Library, the total OPEB liability in the April 30, 2022 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 3.00% Healthcare cost trend rates 10.00% - 5.00% 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, 2023 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, 2022 $2,131,239 $129,493 Changes for the year: Service cost 154,219 2,431 Interest 66,059 3,541 Differences between expected and actual experience (335,854)(27,075) Changes in assumptions or other inputs (10,163)1,458 Benefit payments (146,687)(38,375) Net changes (272,426)(58,020) Balances at April 30, 2023 $1,858,813 $71,473 Changes of assumptions and other inputs reflect a change in the discount rate from 3.21% in 2022 to 3.53% in 2023 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 (2.53%) or 1-percentage-point higher (4.53%) than the current discount rate: 1% Decrease Discount Rate 1% Increase Total OPEB liability, City $1,951,725 $1,858,813 $1,766,040 Total OPEB liability, Library $72,302 $71,473 $70,636 76 118 City of Lake Forest Notes to Financial Statements April 30, 2023 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 (9.0% decreasing to 4.0%) or 1-percentage-point higher (11.0% decreasing to 6.0%) than the current healthcare cost trend rates: 1% Decrease Healthcare Cost Trend Rates 1% Increase Total OPEB liability, City $1,681,141 $1,858,813 $2,067,286 Total OPEB liability, Library $70,017 $71,473 $73,054 OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB For the year ended April 30, 2023, the City recognized OPEB expense of $173,601. At April 30, 2023, 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 $-$658,663 Changes of assumptions or other inputs 256,145 150,106 Total $256,145 $808,769 For the year ended April 30, 2023, the Library recognized OPEB expense of $(219). At April 30, 2023, 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 $-$34,684 Changes of assumptions or other inputs 5,771 4,346 Total $5,771 $39,030 77 119 City of Lake Forest Notes to Financial Statements April 30, 2023 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 2024 $(46,677)$(6,191) 2025 (46,677)(6,191) 2026 (46,677)(6,191) 2027 (46,677)(4,206) 2028 (46,677)(2,271) Thereafter (319,239)(8,209) Total $(552,624)$(33,259) 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, 2023, the City received $1,481,416 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 initial TIF Note payment was made in FY22. Payments of $1,400,000 have been made on the TIF Note as of April 30, 2023. A redevelopment agreement between the City and developer was also executed in September 2016. As of April 30, 2023, 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 2023, 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 is imminent, construction plans have been submitted for City review and the issuance of a building perm it is pending. Nine (9) single family homes are completed, have been sold by the developer to private owners and are occupied. One home is under construction. Two (2) vacant single family lots remain. 78 120 City of Lake Forest Notes to Financial Statements April 30, 2023 Effect of New Accounting Standards on Current-Period Financial Statements The Governmental Accounting Standards Board (GASB) has approved the following: Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangements Statement No. 96, Subscription-Based Information Technology Arrangements 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. 79 121 REQUIRED SUPPLEMENTARY INFORMATION 122 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - General Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Taxes Property $21,613,823 $21,613,823 $21,510,462 $(103,361) Other taxes 2,676,482 2,676,482 3,041,753 365,271 Intergovernmental 6,574,597 6,574,597 8,305,052 1,730,455 Licenses and permits 2,724,018 2,724,018 3,661,327 937,309 Fines, forfeitures and penalties 213,050 213,050 252,955 39,905 Charges for services 4,593,108 4,593,108 4,902,115 309,007 Grants and contributions 6,000 6,000 33,501 27,501 Investment income 65,040 65,040 1,256,067 1,191,027 Miscellaneous revenues 1,270,449 1,270,449 1,392,402 121,953 Total revenues 39,736,567 39,736,567 44,355,634 4,619,067 Expenditures General government 12,080,454 12,344,998 11,368,185 976,813 Highways and streets 3,141,347 3,259,806 3,109,450 150,356 Sanitation 2,627,185 2,628,325 2,748,531 (120,206) Public safety 19,876,487 20,009,735 19,707,053 302,682 Capital outlay 150,000 178,637 178,226 411 Contingency 3,942,346 3,942,346 -3,942,346 Total expenditures 41,817,819 42,363,847 37,111,445 5,252,402 Excess (deficiency) of revenues over (under) expenditures (2,081,252)(2,627,280)7,244,189 9,871,469 Other Financing Sources (Uses) Transfers out (1,295,289)(1,010,255)(4,851,008)(3,840,753) Total other financing sources (uses)(1,295,289)(1,010,255)(4,851,008)(3,840,753) Net change in fund balance $(3,376,541)$(3,637,535)2,393,181 $6,030,716 Fund Balance, Beginning 28,963,725 Fund Balance, Ending $31,356,906 See notes to required supplementary information 80 123 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Parks and Recreation Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Property taxes $6,554,957 $6,554,957 $6,527,772 $(27,185) Intergovernmental 60,000 60,000 140,901 80,901 Charges for services 3,269,706 3,269,706 3,014,446 (255,260) Grants and contributions 273,203 288,053 262,635 (25,418) Investment income 22,000 22,000 133,324 111,324 Miscellaneous revenues 30,500 30,500 56,416 25,916 Total revenues 10,210,366 10,225,216 10,135,494 (89,722) Expenditures Current: Culture and recreation 9,746,905 9,801,530 9,361,809 439,721 Capital outlay 437,024 664,624 252,733 411,891 Contingency 1,054,615 1,054,615 -1,054,615 Total expenditures 11,238,544 11,520,769 9,614,542 1,906,227 Excess (deficiency) of revenues over (under) expenditures (1,028,178)(1,295,553)520,952 1,816,505 Other Financing Sources (Uses) Transfers in 54,730 54,730 23,091 (31,639) Transfers out (80,000)(80,000)(50,000)30,000 Proceeds from capital asset sales --70 70 Total other financing sources (uses)(25,270)(25,270)(26,839)(1,569) Net change in fund balance $(1,053,448)$(1,320,823)494,113 $1,814,936 Fund Balance, Beginning 1,881,221 Fund Balance, Ending $2,375,334 See notes to required supplementary information 81 124 City of Lake Forest Illinois Municipal Retirement Fund Schedule of Changes in the City's Net Pension Liability/(Asset) and Related Ratios Past Eight Fiscal Years 2018 City Library Total City Library Total City Library Total Total pension liability Service cost 1,549,831$ 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: The City implemented GASB Statement No. 68 in fiscal year 2016. Information prior to fiscal year 2016 is not available. 2016 2017 See notes to required supplementary information 82 125 City of Lake Forest Illinois Municipal Retirement Fund Schedule of Changes in the City's Net Pension Liability/(Asset) and Related Ratios Past Eight 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 See notes to required supplementary information 83 126 City of Lake Forest Illinois Municipal Retirement Fund Schedule of Changes in the City's Net Pension Liability/(Asset) and Related Ratios Past Eight Fiscal Years City Library Total City Library Total Total pension liability Service cost 1,192,260$ 119,044$ 1,311,304$ 1,235,060 122,800 1,357,860$ Interest on total pension liability 7,443,020 743,169 8,186,189 7,784,121 773,964 8,558,085 Differences between expected and actual experience of the total pension liability 2,050,858 204,773 2,255,631 1,265,540 125,831 1,391,371 Changes of assumptions (14,992) 14,992 - (5,642) 5,642 - Transfer of liability - - - - - - Benefit payments, including refunds of member contributions (5,769,875) (576,108) (6,345,983) (6,319,285) (628,318) (6,947,603) Net change in total pension liability 4,901,272 505,869 5,407,141 3,959,794 399,919 4,359,713 Total pension liability - beginning 102,234,444 13,195,841 115,430,285 107,135,715 13,701,711 120,837,426 Total pension liability - ending (a)107,135,715$ 13,701,711$ 120,837,426$ 111,095,509$ 14,101,630$ 125,197,139$ Plan fiduciary net position Employer contributions 1,553,376$ 155,101$ 1,708,477$ 1,161,723 115,509 1,277,232$ Employee contributions 645,521 64,454 709,975 638,230 63,458 701,688 Net investment income 18,659,240 1,863,080 20,522,320 (16,214,595) (1,612,194) (17,826,789) Benefit payments, including refunds of member contributions (5,769,875) (576,108) (6,345,983) (6,319,285) (628,318) (6,947,603) Other (net transfer)260,999 26,060 287,059 312,986 31,120 344,106 Net change in plan fiduciary net position 15,349,261 1,532,587 16,881,848 (20,420,941) (2,030,425) (22,451,366) Plan fiduciary net position - beginning 106,588,373 13,647,060 120,235,433 121,937,634 15,179,647 137,117,281 Plan fiduciary net position - ending (b)121,937,634$ 15,179,647$ 137,117,281$ 101,516,693$ 13,149,222$ 114,665,915$ Employer's net pension liability - ending (a) - (b)(14,801,919)$ (1,477,936)$ (16,279,855)$ 9,578,816$ 952,408$ 10,531,224$ Plan fiduciary net position as a percentage of the total pension liability 113.47%91.59% Covered payroll 14,653,276 15,204,138 Employer's net pension liability as a percentage of covered payroll -111.10%69.27% Notes to Schedule: The City implemented GASB Statement No. 68 in fiscal year 2016. Information prior to fiscal year 2016 is not available. 20232022 See notes to required supplementary information 84 127 City of Lake Forest Illinois Municipal Retirement Fund Schedule of Employer Contributions Past Eight Fiscal Years City Library Total City Library Total City Library Total City Library Total Actuarially determined contribution 1,161,647$ 115,501 1,277,148$ 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 (1,161,723) (115,509) (1,277,232) (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)(76)$ (8)$ (84)$ 86$ 9$ 95$ (177)$ (18)$ (195)$ (6,166)$ (667)$ (6,833)$ Covered payroll 15,404,437 14,880,617 15,519,529 14,612,252$ Contributions as a percentage of covered payroll 8.29%11.48%10.85%9.28% City Library Total 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$ 1,741,632$ 233,902$ 1,975,534$ 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) (1,757,095) (235,978) (1,993,073) Contribution deficiency (excess)(20,556)$ (2,128)$ (22,684)$ (37,806)$ (4,513)$ (42,319)$ (40,063)$ (4,899)$ (44,962)$ (15,463)$ (2,076)$ (17,539)$ Covered payroll 14,446,880$ 13,247,776$ 13,135,941$ 13,391,112$ Contributions as a percentage of covered payroll 11.73%12.55%12.77%14.88% Notes to Schedule: Valuation date: 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 7.25% Retirement Age Mortality Other information: There were no benefit changes during the year. 20202021 2016 2023 2019 2022 20172018 MP-2020 Employee Mortality Table, adjusted to match current IMRF experience 5-Year Smoothed Fair Value, 20% corridor 2.50% 2.85% to 13.75%, including inflation Aggregate Entry age normal Experience-based table of rates that are specific to the type of eligibility condition 21 years Level percentage of payroll, closed 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. See notes to required supplementary information 85 128 City of Lake Forest Police Pension Fund Schedule of Changes in the City's Net Pension Liability and Related Ratios Last Nine Fiscal Years 2015 2016 2017 2018 2019 2020 2021 2022 2023 Total pension liability Service cost 845,979$ 883,178$ 931,083$ 895,320$ 900,450$ 908,951$ 1,053,151$ 948,636$ 1,040,068$ 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 4,857,058 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) 1,398,788 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) (3,691,088) 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 3,604,826 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 75,529,445 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$ 79,134,271$ 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$ 3,580,856$ Employee contributions 360,156 373,216 371,695 379,500 392,258 404,985 427,305 474,816 515,034 Net investment income 1,669,508 (475,655) 2,635,379 2,064,885 1,716,441 158,635 8,702,747 (888,628) 493,641 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) (3,691,088) Administrative expenses (4,150) (4,835) (27,816) (34,158) (60,847) (52,357) (45,069) (54,302) (59,179) 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) 839,264 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 42,611,874 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$ 43,451,138$ 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$ 35,683,133$ 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%54.91% 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$ 4,150,388$ 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%859.75% 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. See notes to required supplementary information 86 129 City of Lake Forest Police Pension Fund Schedule of Employer Contributions Last Ten Fiscal Years 2014 2015 2016 2017 Actuarially determined contribution 1,384,307$ 1,508,450$ 1,810,315$ 1,737,445$ Contributions in relation to the actuarially determined contribution 1,563,964 1,706,203 1,806,270 1,895,500 Contribution deficiency (excess)(179,657)$ (197,753)$ 4,045$ (158,055)$ Covered payroll 3,518,797$ 3,590,934$ 3,759,611$ 3,750,706$ Contributions as a percentage of covered payroll 44.45%47.51%48.04%50.54% 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 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 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 20-year amortization in 2021 See notes to required supplementary information 87 130 2018 2019 2020 2021 2022 2023 1,832,059$ 2,505,888$ 2,594,845$ 3,090,726$ 3,388,076$ 3,338,755$ 2,094,124 2,504,581 2,589,534 3,581,389 3,379,444 3,580,856 (262,065)$ 1,307$ 5,311$ (490,663)$ 8,632$ (242,101)$ 3,800,841$ 3,940,419$ 4,059,797$ 4,077,656$ 4,527,537$ 4,150,388$ 55.10%63.56%63.78%87.83%74.64%86.28% See notes to required supplementary information 88 131 City of Lake Forest Police Pension Fund Schedule of Investment Returns Last Nine Fiscal Years 2015 2016 2017 2018 2019 2020 2021 2022 2023 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%1.15% Notes to Schedule: The Pension implemented GASB Statement No. 67 in fiscal year 2015. Information prior to fiscal year 2015 is not available. See notes to required supplementary information 89 132 City of Lake Forest Firefighters' Pension Fund Schedule of Changes in the City's Net Pension Liability and Related Ratios Last Nine Fiscal Years 2015 2016 2017 2018 2019 2020 2021 2022 2023 Total pension liability Service cost 912,154$ 926,420$ 860,148$ 854,245$ 891,741$ 876,151$ 1,017,451$ 1,006,247$ 936,270$ 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 4,282,483 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 1,089,198 150,101 894,144 Changes of assumptions 2,024,054 - 1,401,097 - 3,101,793 1,900,513 - 680,212 121,539 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) (3,285,510) 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 2,948,926 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 66,590,834 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$ 69,539,760$ 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$ 2,511,501$ Employee contributions 296,676 297,946 290,383 296,202 311,675 330,725 349,655 343,611 350,363 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) 259,444 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) (3,285,510) Administrative expenses (4,150) (4,835) (34,006) (35,547) (52,598) (44,220) (38,657) (41,385) (35,450) 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) (199,652) 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 46,876,015 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$ 46,676,363$ 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$ 22,863,397$ 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%67.12% 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$ 3,730,296$ 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%612.91% 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. See notes to required supplementary information 90 133 City of Lake Forest Firefighters' Pension Fund Schedule of Employer Contributions Last Ten Fiscal Years 2014 2015 2016 2017 Actuarially determined contribution 894,384$ 950,325$ 1,217,702$ 1,137,826$ Contributions in relation to the actuarially determined contribution 1,090,695 1,168,287 1,216,585 1,211,587 Contribution deficiency (excess)(196,311)$ (217,962)$ 1,117$ (73,761)$ Covered payroll 3,004,889$ 3,111,216$ 2,924,893$ 3,071,211$ Contributions as a percentage of covered payroll 36.30%37.55%41.59%39.45% 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 20-year amortization in 2021 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 See notes to required supplementary information 91 134 2018 2019 2020 2021 2022 2023 1,298,188$ 1,721,953$ 1,826,568$ 2,075,171$ 2,406,318$ 2,344,403$ 1,308,348 1,719,445 1,822,064 2,567,216 2,398,803 2,511,501 (10,160)$ 2,508$ 4,504$ (492,045)$ 7,515$ (167,098)$ 3,237,410$ 3,388,448$ 3,440,901$ 3,527,518$ 3,523,737$ 3,730,296$ 40.41%50.74%52.95%72.78%68.08%67.33% See notes to required supplementary information 92 135 City of Lake Forest Firefighters' Pension Fund Schedule of Investment Returns Last Nine Fiscal Years 2015 2016 2017 2018 2019 2020 2021 2022 2023 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%0.56% Notes to Schedule: The Pension implemented GASB Statement No. 67 in fiscal year 2015. Information prior to fiscal year 2015 is not available. See notes to required supplementary information 93 136 City of Lake Forest Other Postemployment Benefits Plan Schedule of Changes in the City's Total OPEB Liability and Related Ratios Last Five Fiscal Years 2021 City Library 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$ 154,219$ 2,431$ Interest 93,093 8,019 89,145 7,379 68,569 4,829 49,206 3,258 66,059 3,541 Differences between expected and actual experience - - - - (473,423) (19,803) - - (335,854) (27,075) Changes of assumptions 32,177 1,221 365,319 6,686 6,339 (3,818) (170,973) (3,354) (10,163) 1,458 Benefit payments, including refunds of member contributions (157,993) (16,545) (171,388) (19,768) (183,715) (23,925) (169,067) (32,723) (146,687) (38,375) Net change in total OPEB liability 13,600 (5,685) 332,797 (3,985) (518,105) (40,703) (120,964) (30,384) (272,426) (58,020) Total OPEB liability - beginning 2,423,911 210,250 2,437,511 204,565 2,770,308 200,580 2,252,203 159,877 2,131,239 129,493 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$ 1,858,813$ 71,473$ 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%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$ 22,480,316$ 1,438,338$ 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%8.27%4.97% Notes to Schedule: The District implemented GASB Statement No. 75 in fiscal year 2019. Information prior to fiscal year 2019 is not available. 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. 2023202220202019 See notes to required supplementary information 94 137 City of Lake Forest Notes to Required Supplementary Information Year Ended April 30, 2023 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). 95 138 SUPPLEMENTARY INFORMATION 139 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 system. 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. General Cemetery Fund –This fund accounts for the operations of the cemetery commission. Financing is provided by the proceeds from cemetery lot sales, user charges and donations. 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. 140 City of Lake Forest Combining Balance Sheet Nonmajor Governmental Funds April 30, 2023 Special Revenue Funds Police Restricted Foreign Fire Insurance Tax Emergency Telephone Parks and Public Land Motor Fuel Tax Assets Cash and cash equivalents $159,272 $175,054 $298,511 $2,218,953 $3,357,714 Investments ----- Receivables: Property taxes ----- Other 103 -1,192,554 -- Due from other governments ----68,807 Due from fiduciary funds ----- Prepaid items --37,037 -- Total assets $159,375 $175,054 $1,528,102 $2,218,953 $3,426,521 Liabilities, Deferred Inflows of Resources and Fund Balances Liabilities Accounts payable $-$-$3,415 $9,000 $3,981 Accrued liabilities ----- Deposits ----- Total liabilities --3,415 9,000 3,981 Deferred Inflows of Resources Property taxes levied for a future period ----- Total deferred inflows of resources ----- Fund Balances Nonspendable for prepaid items --37,037 -- Restricted for capital projects ----- Restricted for culture and recreation ---2,209,953 - Restricted for highways and streets ----3,422,540 Restricted for public safety 159,375 175,054 1,487,650 -- Restricted for cemetery perpetual care ----- Restricted for affordable housing ----- Restricted for debt service purposes ----- Total fund balances 159,375 175,054 1,524,687 2,209,953 3,422,540 Total liabilities, deferred inflows of resources and fund balances $159,375 $175,054 $1,528,102 $2,218,953 $3,426,521 96 141 Special Revenue Funds Debt Service Funds Capital Projects Fund Senior Resources Commission Housing Trust General Cemetery Debt Service Laurel/Western Redevelopment TIF Total Nonmajor Governmental Funds $79,818 $2,396,132 $1,931,008 $2,011,962 $52,188 $12,680,612 --8,894,847 --8,894,847 ---1,970,582 -1,970,582 28,879 -54,300 --1,275,836 -----68,807 --76,877 --76,877 --11,010 --48,047 $108,697 $2,396,132 $10,968,042 $3,982,544 $52,188 $25,015,608 $20,820 $3,340 $36,419 $-$-$76,975 5,572 -7,838 --13,410 -18,000 ---18,000 26,392 21,340 44,257 --108,385 ---1,970,582 -1,970,582 ---1,970,582 -1,970,582 --11,010 --48,047 ----52,188 52,188 82,305 ----2,292,258 -----3,422,540 -----1,822,079 --10,912,775 --10,912,775 -2,374,792 ---2,374,792 ---2,011,962 -2,011,962 82,305 2,374,792 10,923,785 2,011,962 52,188 22,936,641 $108,697 $2,396,132 $10,968,042 $3,982,544 $52,188 $25,015,608 97 142 City of Lake Forest Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds Year Ended April 30, 2023 Special Revenue Funds Police Restricted Foreign Fire Insurance Tax Emergency Telephone Parks and Public Land Motor Fuel Tax Revenues Taxes: Property $-$-$-$-$- Other ----- Intergovernmental 868 ---1,003,460 Charges for services 37,779 160,772 501,985 15,668 - Grants and contributions --86,137 140,000 - Investment income 5,021 180 2,936 75,102 101,861 Miscellaneous revenues ----- Total revenues 43,668 160,952 591,058 230,770 1,105,321 Expenditures Current: General government ----- Culture and recreation ---195,900 - Public safety 1,953 201,825 217,139 -- Capital outlay --148,523 233,314 78,527 Debt service: Principal retirement ----- Interest and fiscal charges ----- Total expenditures 1,953 201,825 365,662 429,214 78,527 Excess (deficiency) of revenues over expenditures 41,715 (40,873)225,396 (198,444)1,026,794 Other Financing Sources (Uses) Transfers in ----- Transfers out ----- Total other financing sources (uses)----- Net change in fund balances 41,715 (40,873)225,396 (198,444)1,026,794 Fund Balances, Beginning 117,660 215,927 1,299,291 2,408,397 2,395,746 Fund Balances, Ending $159,375 $175,054 $1,524,687 $2,209,953 $3,422,540 98 143 Special Revenue Funds Debt Service Funds Capital Projects Fund Senior Resources Commission Housing Trust General Cemetery Debt Service Laurel/Western Redevelopment TIF Total Nonmajor Governmental Funds $-$-$-$2,084,524 $1,481,416 $3,565,940 -48,000 ---48,000 -----1,004,328 114,148 -1,184,727 --2,015,079 175,149 -17,071 --418,357 3,155 79,747 (17,871)66,259 37,994 354,384 271 72,000 ---72,271 292,723 199,747 1,183,927 2,150,783 1,519,410 7,478,359 -8,440 762,016 31,887 212,533 1,014,876 565,963 ----761,863 -----420,917 --142,322 --602,686 ---2,192,956 -2,192,956 ---769,126 -769,126 565,963 8,440 904,338 2,993,969 212,533 5,762,424 (273,240)191,307 279,589 (843,186)1,306,877 1,715,935 266,556 -690 1,260,688 -1,527,934 ----(1,260,688)(1,260,688) 266,556 -690 1,260,688 (1,260,688)267,246 (6,684)191,307 280,279 417,502 46,189 1,983,181 88,989 2,183,485 10,643,506 1,594,460 5,999 20,953,460 $82,305 $2,374,792 $10,923,785 $2,011,962 $52,188 $22,936,641 99 144 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Police Restricted Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Intergovernmental $4,000 $4,000 $868 $(3,132) Charges for services 28,000 28,000 37,779 9,779 Investment income 1,000 1,000 5,021 4,021 Total revenues 33,000 33,000 43,668 10,668 Expenditures Current: Public safety 45,000 45,000 1,953 43,047 Capital outlay 45,000 45,000 -45,000 Contingency 9,000 9,000 -9,000 Total expenditures 99,000 99,000 1,953 97,047 Net change in fund balance $(66,000)$(66,000)41,715 $107,715 Fund Balance, Beginning 117,660 Fund Balance, Ending $159,375 100 145 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, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Charges for services $125,000 $125,000 $160,772 $35,772 Investment income --180 180 Total revenues 125,000 125,000 160,952 35,952 Expenditures Public safety 300,000 300,000 201,825 98,175 Total expenditures 300,000 300,000 201,825 98,175 Net change in fund balance $(175,000)$(175,000)(40,873)$134,127 Fund Balance, Beginning 215,927 Fund Balance, Ending $175,054 101 146 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Emergency Telephone Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Charges for services $430,000 $430,000 $501,985 $71,985 Grants and contributions --86,137 86,137 Investment income 2,500 2,500 2,936 436 Miscellaneous revenues 86,137 86,137 -(86,137) Total revenues 518,637 518,637 591,058 72,421 Expenditures Public safety 220,000 220,000 217,139 2,861 Capital outlay 167,000 167,000 148,523 18,477 Contingency 38,700 38,700 -38,700 Total expenditures 425,700 425,700 365,662 60,038 Net change in fund balance $92,937 $92,937 225,396 $132,459 Fund Balance, Beginning 1,299,291 Fund Balance, Ending $1,524,687 102 147 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, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Charges for services $31,336 $31,336 $15,668 $(15,668) Grants and contributions --140,000 140,000 Investment income 6,465 6,465 75,102 68,637 Total revenues 37,801 37,801 230,770 192,969 Expenditures Culture and recreation 65,000 255,784 195,900 59,884 Capital outlay 250,000 250,000 233,314 16,686 Contingency 50,578 50,578 -50,578 Total expenditures 365,578 556,362 429,214 127,148 Excess (deficiency) of revenues over (under) expenditures (327,777)(518,561)(198,444)320,117 Other Financing Sources (Uses) Net change in fund balance $(327,777)$(518,561)(198,444)$320,117 Fund Balance, Beginning 2,408,397 Fund Balance, Ending $2,209,953 103 148 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Motor Fuel Tax Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Intergovernmental $769,645 $769,645 $1,003,460 $233,815 Investment income 9,600 9,600 101,861 92,261 Total revenues 779,245 779,245 1,105,321 326,076 Expenditures Capital outlay 225,000 469,986 78,527 391,459 Contingency 46,999 46,999 -46,999 Total expenditures 271,999 516,985 78,527 438,458 Net change in fund balance $507,246 $262,260 1,026,794 $764,534 Fund Balance, Beginning 2,395,746 Fund Balance, Ending $3,422,540 104 149 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Senior Resources Commission Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Charges for services $137,000 $137,000 $114,148 $(22,852) Grants and contributions 199,319 199,319 175,149 (24,170) Investment income 3,500 3,500 3,155 (345) Miscellaneous revenues --271 271 Total revenues 339,819 339,819 292,723 (47,096) Expenditures Culture and recreation 604,072 604,072 565,963 38,109 Contingency 60,407 60,407 -60,407 Total expenditures 664,479 664,479 565,963 98,516 Excess (deficiency) of revenues over (under) expenditures (324,660)(324,660)(273,240)51,420 Other Financing Sources Transfers in 264,253 264,253 266,556 2,303 Total other financing sources 264,253 264,253 266,556 2,303 Net change in fund balance $(60,407)$(60,407)(6,684)$53,723 Fund Balance, Beginning 88,989 Fund Balance, Ending $82,305 105 150 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Housing Trust Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Other taxes $24,000 $24,000 $48,000 $24,000 Investment income 8,000 8,000 79,747 71,747 Miscellaneous revenues --72,000 72,000 Total revenues 32,000 32,000 199,747 167,747 Expenditures General government 750,000 767,553 8,440 759,113 Contingency 76,755 76,755 -76,755 Total expenditures 826,755 844,308 8,440 835,868 Excess (deficiency) of revenues over (under) expenditures (794,755)(812,308)191,307 1,003,615 Other Financing Sources Net change in fund balance $(794,755)$(812,308)191,307 $1,003,615 Fund Balance, Beginning 2,183,485 Fund Balance, Ending $2,374,792 106 151 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - General Cemetery Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Charges for services $800,600 $800,600 $1,184,727 $384,127 Grants and contributions 12,000 12,000 17,071 5,071 Investment income (loss)50,000 50,000 (17,871)(67,871) Total revenues 862,600 862,600 1,183,927 321,327 Expenditures Current: General government 794,870 794,870 762,016 32,854 Capital outlay 160,000 1,711,011 142,322 1,568,689 Contingency 250,588 250,588 -250,588 Total expenditures 1,205,458 2,756,469 904,338 1,852,131 Excess (deficiency) of revenues over (under) expenditures (342,858)(1,893,869)279,589 2,173,458 Other Financing Sources (Uses) Transfers in --690 690 General obligation bonds issued -1,400,000 -(1,400,000) Total other financing sources (uses)-1,400,000 690 (1,399,310) Net change in fund balance $(342,858)$(493,869)280,279 $774,148 Fund Balance, Beginning 10,643,506 Fund Balance, Ending $10,923,785 107 152 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Debt Service Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Taxes: Property $2,075,525 $2,075,525 $2,084,524 $8,999 Investment income 9,346 9,346 66,259 56,913 Total revenues 2,084,871 2,084,871 2,150,783 65,912 Expenditures Current: General government 2,250 2,250 31,887 (29,637) Debt service: Principal retirement 2,192,957 2,192,957 2,192,956 1 Interest and fiscal charges 769,116 769,116 769,126 (10) Total expenditures 2,964,323 2,964,323 2,993,969 (29,646) Excess (deficiency) of revenues over (under) expenditures (879,452)(879,452)(843,186)36,266 Other Financing Sources (Uses) Transfers in 360,688 360,688 1,260,688 900,000 Total other financing sources (uses)360,688 360,688 1,260,688 900,000 Net change in fund balance $(518,764)$(518,764)417,502 $936,266 Fund Balance, Beginning 1,594,460 Fund Balance, Ending $2,011,962 108 153 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, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Property taxes $1,400,000 $1,400,000 $1,481,416 $81,416 Investment income 1,000 1,000 37,994 36,994 Total revenues 1,401,000 1,401,000 1,519,410 118,410 Expenditures General government 570,000 570,000 212,533 357,467 Capital outlay 100,000 100,000 -100,000 Contingency 140,069 140,069 -140,069 Total expenditures 810,069 810,069 212,533 597,536 Excess (deficiency) of revenues over (under) expenditures 590,931 590,931 1,306,877 715,946 Other Financing Sources (Uses) Transfers out (730,688)(730,688)(1,260,688)(530,000) Total other financing sources (uses)(730,688)(730,688)(1,260,688)(530,000) Net change in fund balance $(139,757)$(139,757)46,189 $185,946 Fund Balance, Beginning 5,999 Fund Balance, Ending $52,188 109 154 City of Lake Forest Schedule of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual - Capital Improvements Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Revenues Taxes Property $1,548,908 $1,548,908 $1,540,184 $(8,724) Other taxes 2,746,016 2,746,016 4,207,185 1,461,169 Charges for services 110,950 110,950 154,211 43,261 Grants and contributions 2,923,166 5,673,166 2,780,850 (2,892,316) Investment income 75,000 75,000 789,470 714,470 Miscellaneous 5,000 5,000 36,775 31,775 Total revenues 7,409,040 10,159,040 9,508,675 (650,365) Expenditures Current: General government 1,190,825 1,243,034 878,694 364,340 Highways and streets 2,128,000 2,501,975 2,380,075 121,900 Sanitation -50,576 4,050 46,526 Culture and recreation 90,000 90,000 -90,000 Capital outlay 8,588,665 13,310,630 7,938,205 5,372,425 Contingency 1,722,905 1,722,905 -1,722,905 Debt service: Interest and fiscal charges --155,964 (155,964) Total expenditures 13,720,395 18,919,120 11,356,988 7,562,132 Excess (deficiency) of revenues over (under) expenditures (6,311,355)(8,760,080)(1,848,313)6,911,767 Other Financing Sources (Uses) General obligation bonds issued --10,770,000 10,770,000 Premium on debt issued --1,390,156 1,390,156 Transfers in 920,000 920,000 4,550,000 3,630,000 Proceeds from capital asset sales 20,000 20,000 265,641 245,641 Total other financing sources (uses)940,000 940,000 16,975,797 16,035,797 Net change in fund balance $(5,371,355)$(7,820,080)15,127,484 $22,947,564 Fund Balance, Beginning 22,340,775 Fund Balance, Ending $37,468,259 110 155 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. 156 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, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Operating Revenues Charges for services $8,710,634 $8,710,634 $8,873,155 $162,521 Connection fees 125,000 125,000 157,192 32,192 Miscellaneous 4,000 4,000 1,470 (2,530) Total operating revenues 8,839,634 8,839,634 9,031,817 192,183 Operating Expenses General and administrative 2,610,523 2,610,523 2,594,801 15,722 Operations and maintenance 3,504,945 3,352,338 2,539,800 812,538 Contingency 957,699 957,699 -957,699 Total operating expenses 7,073,167 6,920,560 5,134,601 1,785,959 Nonoperating Revenues (Expenses) Investment income 41,537 41,537 483,187 441,650 Principal retirement (1,888,607)(1,888,607)(1,888,607)- Interest expense (424,772)(424,772)(277,982)146,790 Paying agent fees (750)(750)(905)(155) Total nonoperating revenues (expenses)(2,272,592)(2,272,592)(1,684,307)588,285 Contribution and Transfers Transfers in --8,796 8,796 Net contribution and transfers --8,796 8,796 111 157 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, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Operating Revenues Charges for services $1,764,617 $1,764,617 $1,861,913 $97,296 Miscellaneous 5,234 5,234 -(5,234) Total operating revenues 1,769,851 1,769,851 1,861,913 92,062 Operating Expenses General and administrative 750,497 750,497 759,176 (8,679) Operations and maintenance 1,002,396 1,156,846 1,142,760 14,086 Contingency 200,426 200,426 -200,426 Total operating expenses 1,953,319 2,107,769 1,901,936 205,833 Nonoperating Revenues (Expenses) Investment income --13,929 13,929 Principal retirement (87,645)(87,645)(87,645)- Interest expense (8,775)(8,775)746 9,521 Grants and contributions -138,617 138,517 (100) Paying agent fees (500)(500)(8)492 Other --8,090 8,090 Total nonoperating revenues (expenses)(96,920)41,697 73,629 31,932 Contribution and Transfers Transfers in 80,000 80,000 50,000 (30,000) Net contribution and transfers 80,000 80,000 50,000 (30,000) 112 158 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. 159 City of Lake Forest Combining Statement of Net Position Internal Service Funds April 30, 2023 Fleet Self Insurance Liability Insurance Total Assets Current assets: Cash and cash equivalents $440,228 $5,177,176 $2,086,345 $7,703,749 Receivables: Other 8,950 25,083 5,731,037 5,765,070 Inventories 514,931 --514,931 Prepaid items --685,521 685,521 Total current assets 964,109 5,202,259 8,502,903 14,669,271 Noncurrent assets: Capital assets (net of accumulated depreciation): Property and equipment 48,047 --48,047 Accumulated depreciation (48,047)--(48,047) Total assets 964,109 5,202,259 8,502,903 14,669,271 Deferred Outflows of Resources Deferred outflows related to pensions 417,436 --417,436 Deferred outflows related to total OPEB liability 6,650 --6,650 Total deferred outflows of resources 424,086 --424,086 Liabilities Current liabilities: Accounts payable 31,633 855,040 78,850 965,523 Accrued liabilities 11,277 426,629 127,829 565,735 Unearned revenue 5,407 --5,407 Total OPEB liability 4,103 --4,103 Total current liabilities 52,420 1,281,669 206,679 1,540,768 Noncurrent liabilities: Compensated absences 37,782 --37,782 Net pension liability 381,503 --381,503 Total OPEB liability 44,152 --44,152 Total noncurrent liabilities 463,437 --463,437 Total liabilities 515,857 1,281,669 206,679 2,004,205 Deferred Inflows of Resources Deferred inflows related to pensions 2,557 --2,557 Deferred inflows related to total OPEB liability 20,996 --20,996 Total deferred inflows of resources 23,553 --23,553 Net Position Unrestricted 848,785 3,920,590 8,296,224 13,065,599 Total net position $848,785 $3,920,590 $8,296,224 $13,065,599 113 160 City of Lake Forest Combining Statement of Revenues, Expenses and Changes in Fund Net Position Internal Service Funds Year Ended April 30, 2023 Fleet Self Insurance Liability Insurance Totals Operating Revenues Charges for services $1,974,902 $5,712,186 $1,357,477 $9,044,565 Total operating revenues 1,974,902 5,712,186 1,357,477 9,044,565 Operating Expenses General and administrative 2,152,068 5,916,875 1,434,917 9,503,860 Total operating expenses 2,152,068 5,916,875 1,434,917 9,503,860 Operating income (177,166)(204,689)(77,440)(459,295) Nonoperating Revenues Investment income 16,796 149,144 79,418 245,358 Total nonoperating revenues 16,796 149,144 79,418 245,358 Income (loss) before transfers (160,370)(55,545)1,978 (213,937) Transfers Transfers in 1,875 --1,875 Total transfers 1,875 --1,875 Change in net position (158,495)(55,545)1,978 (212,062) Net Position, Beginning 1,007,280 3,976,135 8,294,246 13,277,661 Net Position, Ending $848,785 $3,920,590 $8,296,224 $13,065,599 114 161 City of Lake Forest Combining Statement of Cash Flows Internal Service Funds Year Ended April 30, 2023 Fleet Self Insurance Liability Insurance Total Cash Flows From Operating Activities Received from customers $1,977,299 $5,717,687 $1,327,356 $9,022,342 Paid to suppliers for goods and services (1,582,283)(6,253,483)(1,380,961)(9,216,727) Paid to employees for services (554,436)--(554,436) Net cash flows from operating activities (159,420)(535,796)(53,605)(748,821) Cash Flows From Investing Activities Investment income 16,796 149,144 79,418 245,358 Net cash flows from investing activities 16,796 149,144 79,418 245,358 Cash Flows From Noncapital Financing Activities Transfers from (to) other funds 1,875 --1,875 Net cash flows from noncapital financing activities 1,875 --1,875 Net change in cash and cash equivalents (140,749)(386,652)25,813 (501,588) Cash and Cash Equivalents, Beginning 580,977 5,563,828 2,060,532 8,205,337 Cash and Cash Equivalents, Ending $440,228 $5,177,176 $2,086,345 $7,703,749 Reconciliation of Operating Income (Loss) to Net Cash Flows From Operating Activities Operating income (loss)$(177,166)$(204,689)$(77,440)$(459,295) Changes in assets and liabilities: Accounts receivable (3,010)5,501 (30,121)(27,630) Inventories (16,660)--(16,660) Prepaid items --62,666 62,666 Net pension asset 623,708 --623,708 Deferred outflows related to pensions (340,265)--(340,265) Accounts payable 7,118 76,141 (41,312)41,947 Accrued liabilities 134 (412,749)32,602 (380,013) Net pension liability 381,503 --381,503 Deferred inflows related to pensions (640,391)--(640,391) Deferred revenue 5,407 --5,407 Compensated absences 2,596 --2,596 Deferred outflows related to total OPEB liability 1,322 --1,322 Deferred inflows related to total OPEB liability 6,120 --6,120 Total OPEB liability (9,836)--(9,836) Net cash flows from operating activities $(159,420)$(535,796)$(53,605)$(748,821) 115 162 City of Lake Forest Schedule of Revenues, Expenses and Nonoperating Revenues - Budget and Actual (Budgetary Basis) Fleet Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Operating Revenues Charges for services $1,965,964 $1,965,964 $1,974,902 $8,938 Total operating revenues 1,965,964 1,965,964 1,974,902 8,938 Operating Expenses General and administrative 2,062,964 2,082,000 2,152,068 (70,068) Contingency 208,200 208,200 -208,200 Total operating expenses 2,271,164 2,290,200 2,152,068 138,132 Nonoperating Revenues Investment income 3,000 3,000 16,796 13,796 Total nonoperating revenues 3,000 3,000 16,796 13,796 Net income (loss) before transfers (302,200)(321,236)(160,370)160,866 Transfers Transfers in --1,875 1,875 Net transfers --1,875 1,875 Change in net position $(302,200)$(321,236)(158,495)$162,741 Net Position, Beginning 1,007,280 Net Position, Ending $848,785 116 163 City of Lake Forest Schedule of Revenues, Expenses and Nonoperating Revenues - Budget and Actual (Budgetary Basis) Self Insurance Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Operating Revenues Charges for services $5,710,000 $5,710,000 $5,712,186 $2,186 Total operating revenues 5,710,000 5,710,000 5,712,186 2,186 Operating Expenses General and administrative 5,985,000 5,985,000 5,916,875 68,125 Contingency 598,500 598,500 -598,500 Total operating expenses 6,583,500 6,583,500 5,916,875 666,625 Nonoperating Revenues Investment income 20,000 20,000 149,144 129,144 Total nonoperating revenues 20,000 20,000 149,144 129,144 Net income (loss)(853,500)(853,500)(55,545)797,955 Change in net position $(853,500)$(853,500)(55,545)$797,955 Net Position, Beginning 3,976,135 Net Position, Ending $3,920,590 117 164 City of Lake Forest Schedule of Revenues, Expenses and Nonoperating Revenues - Budget and Actual (Budgetary Basis) Liability Insurance Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Operating Revenues Charges for services $1,327,348 $1,327,348 $1,357,477 $30,129 Total operating revenues 1,327,348 1,327,348 1,357,477 30,129 Operating Expenses General and administrative 1,250,000 1,400,000 1,434,917 (34,917) Contingency 125,000 125,000 -125,000 Total operating expenses 1,375,000 1,525,000 1,434,917 90,083 Nonoperating Revenues Investment income 10,000 10,000 79,418 69,418 Total nonoperating revenues 10,000 10,000 79,418 69,418 Change in net position $(37,652)$(187,652)1,978 $189,630 Net Position, Beginning 8,294,246 Net Position, Ending $8,296,224 118 165 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. . 166 City of Lake Forest Combining Statement of Fiduciary Net Position Pension Trust Funds April 30, 2023 Police Pension Firefighters' Pension Total Assets Cash $54,092 $603,278 $657,370 Investments: Illinois police officers' pension investment fund 43,349,372 -43,349,372 Illinois firefighters' pension investment fund -46,040,951 46,040,951 Prepaid items 1,523 5,820 7,343 Due from primary government 47,276 26,684 73,960 Total assets 43,452,263 46,676,733 90,128,996 Liabilities Accounts payable 1,125 370 1,495 Total liabilities 1,125 370 1,495 Net Position Restricted for pension benefits $43,451,138 $46,676,363 $90,127,501 119 167 City of Lake Forest Combining Statement of Changes in Fiduciary Net Position Pension Trust Funds Year Ended April 30, 2023 Police Pension Firefighters' Pension Total Additions Contributions: Employer $3,580,856 $2,511,501 $6,092,357 Employee 515,033 350,363 865,396 Total contributions 4,095,889 2,861,864 6,957,753 Investment income: Interest 219,212 465,624 684,836 Net appreciation (depreciation) in fair value of investments 332,539 (167,321)165,218 Total investment income (loss)551,751 298,303 850,054 Less investment expense (59,925)(36,074)(95,999) Net investment income 491,826 262,229 754,055 Miscellaneous 1,816 (2,786)(970) Total additions 4,589,531 3,121,307 7,710,838 Deductions Pension benefits and refunds 3,691,088 3,285,509 6,976,597 Other administrative expenses 59,179 35,450 94,629 Total deductions 3,750,267 3,320,959 7,071,226 Change in net position 839,264 (199,652)639,612 Net Position, Beginning 42,611,874 46,876,015 89,487,889 Net Position, Ending $43,451,138 $46,676,363 $90,127,501 120 168 City of Lake Forest Schedule of Changes in Fiduciary Net Position - Budget and Actual Police Pension Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Additions Contributions: Employer $3,588,755 $3,588,755 $3,580,856 $(7,899) Employee 431,340 431,340 515,033 83,693 Total contributions 4,020,095 4,020,095 4,095,889 75,794 Investment income (loss): Interest 700,000 700,000 219,212 (480,788) Net appreciation (depreciation) in fair value of investments 2,253,854 2,253,854 332,539 (1,921,315) Total investment income (loss)2,953,854 2,953,854 551,751 (2,402,103) Less investment expense (80,000)(80,000)(59,925)20,075 Net investment income (loss)2,873,854 2,873,854 491,826 (2,382,028) Miscellaneous --1,816 1,816 Total additions 6,893,949 6,893,949 4,589,531 (2,304,418) Deductions Pension benefits and refunds 3,920,000 3,920,000 3,691,088 228,912 Other administrative expenses 70,495 70,495 59,179 11,316 Contingency 407,049 407,049 -407,049 Total deductions 4,397,544 4,397,544 3,750,267 647,277 Change in net position $2,496,405 $2,496,405 839,264 $(1,657,141) Net Position, Beginning 42,611,874 Net Position, Ending $43,451,138 121 169 City of Lake Forest Schedule of Changes in Fiduciary Net Position - Budget and Actual Firefighters' Pension Fund Year Ended April 30, 2023 Budgeted Amounts Original Final Actual Variance with Final Budget Additions Contributions: Employer $2,519,403 $2,519,403 $2,511,501 $(7,902) Employee 361,000 361,000 350,363 (10,637) Total contributions 2,880,403 2,880,403 2,861,864 (18,539) Investment income (loss): Interest 800,000 800,000 465,624 (334,376) Net appreciation (depreciation) in fair value of investments 2,602,750 2,602,750 (167,321)(2,770,071) Total investment income (loss)3,402,750 3,402,750 298,303 (3,104,447) Less Investment expense (65,000)(65,000)(36,074)28,926 Net investment income (loss)3,337,750 3,337,750 262,229 (3,075,521) Miscellaneous --(2,786)(2,786) Total additions 6,218,153 6,218,153 3,121,307 (3,096,846) Deductions Pension benefits and refunds 3,212,230 3,212,230 3,285,509 (73,279) Other administrative expenses 60,495 60,495 35,450 25,045 Contingency 333,772 333,772 -333,772 Total deductions 3,606,497 3,606,497 3,320,959 285,538 Change in net position $2,611,656 $2,611,656 (199,652)$(2,811,308) Net Position, Beginning 46,876,015 Net Position, Ending $46,676,363 122 170 Discretely Presented Component Unit Lake Forest Library –General Fund –This fund accounts for the operation and maintenance of the Lake Forest Library. Financing is provided by a specific annual property tax levy, charges for services, fines and forfeits, interest earned on investments and other miscellaneous revenues. 171 City of Lake Forest Discretely Presented Component Unit - Lake Forest Library Statement of Net Position and General Fund Balance Sheet General Statement of Fund Adjustments Net Position Assets and Deferred Outflows of Resources Assets Cash and cash equivalents 7,695,677$ -$ 7,695,677$ uncollectibles) 4,654,873 - 4,654,873 23,567 - 23,567 22,493 22,493 Capital assets not depreciated - 718,500 718,500 Capital assets depreciated, net of accumulated depreciation - 2,373,292 2,373,292 12,396,610 3,091,792 15,488,402 Deferred outflows of Resources Deferred outflows related to pensions - 1,046,536 1,046,536 Deferred outflows related to total OPEB liability - 5,771 5,771 - 1,052,307 1,052,307 12,396,610$ 4,144,099$ 16,540,709$ Liabilities, Deferred Inflows of Resources and Fund Balance/Net Position Liabilities 75,415$ -$ 75,415$ 62,799 - 62,799 Long-term obligations Due within one year - 34,724 34,724 Due in more than one year - 1,089,688 1,089,688 138,214 1,124,412 1,262,626 Deferred Inflows of Resources Property taxes levied for future periods 4,654,873 - 4,654,873 Deferred inflows related to pensions 6,384 6,384 Deferred inflows related to total OPEB liability - 39,030 39,030 4,654,873 45,414 4,700,287 Fund Balance/Net Position Unassigned 7,603,523 (7,603,523) - Net position Net investment in capital assets - 3,091,792 3,091,792 Unrestricted - 7,486,004 7,486,004 7,603,523 2,974,273 10,577,796 12,396,610$ 4,144,099$ 16,540,709$ Accounts payable Accrued liabilities April 30, 2023 Property taxes Receivables (net of allowance for Other taxes Total assets Capital assets Accounts 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 123 172 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, 2023 Statement General of Fund Adjustments Activities Revenues 4,463,978$ -$ 4,463,978$ 117,016 - 117,016 35,088 - 35,088 117,279 - 117,279 Fines 3,650 - 3,650 307,550 - 307,550 5,044,561 - 5,044,561 Expenditures/expenses Current 3,603,687 385,633 3,989,320 Capital outlay 908,958 (908,958) - Total expenditures/expenses 4,512,645 (523,325) 3,989,320 Net change in fund balance/net position 531,916 523,325 1,055,241 7,071,607 2,450,948 9,522,555 Fund Balance/Net Position, Ending 7,603,523$ 2,974,273$ 10,577,796$ Fund Balance/Net Position, Beginning Property taxes Charges for services Total revenues Intergovernmental Grants and contributions Investment Income 124 173 City of Lake Forest Summary of Debt Service Requirements to Maturity April 30, 2023 General Fiscal Obligation Year Bonds 2024 6,257,224$ 2025 4,241,965 2026 4,251,716 2027 4,236,915 2028 4,252,865 2029 4,514,430 2030 4,538,836 2031 4,665,887 2032 4,673,062 2033 4,640,223 2034 3,678,313 2035 1,149,063 2036 1,150,250 2037 1,145,275 2038 786,600 54,182,624$ 125 174 City of Lake Forest Debt Service Requirements to Maturity - General Obligation Bonds April 30, 2023 Year Principal Interest Principal Interest Principal Interest 2024 150,612$ 5,497$ 370,000$ 252,050$ 515,000$ 271,153$ 2025 - - 385,000 242,800 525,000 260,853 2026 - - 405,000 233,175 535,000 247,728 2027 - - 410,000 223,050 550,000 234,352 2028 - - 435,000 212,800 565,000 220,602 2029 - - 650,000 200,837 580,000 206,477 2030 - - 695,000 181,337 590,000 191,687 2031 - - 740,000 160,488 610,000 173,987 2032 - - 705,000 136,438 630,000 155,687 2033 - - 720,000 113,525 645,000 136,787 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 26,600 150,612$ 5,497$ 8,065,000$ 2,121,350$ 9,295,000$ 2,468,214$ Series 2015 Series 2017 Obligation Bonds Obligation Bonds Fiscal Tax Bonds Special Service Area 29 126 175 City of Lake Forest Debt Service Requirements to Maturity - General Obligation Bonds April 30, 2023 Year Principal Interest Principal Interest Principal Interest 2024 2,370,000$ 315,962$ 590,000$ 140,900$ 935,000$ 341,050$ 2025 630,000 197,462 600,000 129,100 780,000 491,750 2026 660,000 165,963 615,000 117,100 820,000 452,750 2027 695,000 132,963 615,000 104,800 860,000 411,750 2028 730,000 98,213 625,000 92,500 905,000 368,750 2029 735,000 83,616 705,000 80,000 950,000 323,500 2030 755,000 68,912 715,000 65,900 1,000,000 276,000 2031 780,000 53,812 820,000 51,600 1,050,000 226,000 2032 810,000 37,237 890,000 35,200 1,100,000 173,500 2033 845,000 19,011 870,000 17,400 1,155,000 118,500 2034 - - - - 1,215,000 60,750 2035 - - - - - - 2036 - - - - - - 2037 - - - - - - 2038 - - - - - - 9,010,000$ 1,173,151$ 7,045,000$ 834,500$ 10,770,000$ 3,244,300$ Obligation Bonds Series 2021 Series 2023 Obligation Bonds Obligation Bonds Fiscal Series 2019 127 176 City of Lake Forest Debt Service Requirements to Maturity - General Obligation Bonds April 30, 2023 Fiscal Year Principal Interest Total 2024 4,930,612 1,326,612 6,257,224$ 2025 2,920,000 1,321,965 4,241,965 2026 3,035,000 1,216,716 4,251,716 2027 3,130,000 1,106,915 4,236,915 2028 3,260,000 992,865 4,252,865 2029 3,620,000 894,430 4,514,430 2030 3,755,000 783,836 4,538,836 2031 4,000,000 665,887 4,665,887 2032 4,135,000 538,062 4,673,062 2033 4,235,000 405,223 4,640,223 2034 3,410,000 268,313 3,678,313 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 44,335,612$ 9,847,012$ 54,182,624$ Requirements Total 128 177 City of Lake Forest Special Service Area 29 Special Tax Bonds - 2004 Series April 30, 2023 Date of issue: Date of maturity:December 15, 2023 Authorized issue:$2,000,000 Denomination of bonds:One bond per maturity Interest rates:2.55-3.65% Interest dates:June 15 and December 15 Payable at:Lake Forest Bank and Trust Lake Forest, Illinois Redeemable Annually on December 15 Amount 2023 150,612$ 150,612$ Bond Principal and Interest Requirements Tax Levy Tax Levy Year Principal Interest Total June 15 Amount December 15 Amount 2022 150,612$ 5,497$ 156,109$ 2023 2,749 2023 2,748 150,612$ 5,497$ 156,109$ Coupons Due on December 20, 2004 129 178 City of Lake Forest General Obligation Bonds – 2015 April 30, 2023 Date of issue: Date of maturity:December 15, 2036 Authorized issue:$9,780,000 Denomination of bonds:$5,000 Interest rates:2.50 - 3.75% Interest dates:June 15 and December 15 Payable at:Wells Fargo Bank Chicago, Illinois Redeemable Annually on December 15 Amount 2023 370,000$ 2024 385,000 2025 405,000 2026 410,000 2027 435,000 Thereafter 6,060,000 8,065,000$ Bond Principal and Interest Requirements Tax Levy Tax Levy Year Principal Interest Total June 15 Amount December 15 Amount 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 2026 435,000 212,800 647,800 2027 106,400 2027 106,400 Thereafter 6,060,000 957,475 7,017,475 Thereafter 478,738 Thereafter 478,737 8,065,000$ 2,121,350$ 10,186,350$ August 3, 2015 Coupons Due on 130 179 City of Lake Forest General Obligation Bonds – 2017 April 30, 2023 Date of issue: Date of maturity:December 15, 2037 Authorized issue:$9,295,000 Denomination of bonds:$5,000 Interest rates:2.00 - 3.50% Interest dates:June 15 and December 15 Payable at:Bank of New York Mellon Chicago, Illinois Redeemable Annually on December 15 Amount 2023 515,000$ 2024 525,000 2025 535,000 2026 550,000 2027 565,000 Thereafter 6,605,000 9,295,000$ Bond Principal and Interest Requirements Tax levy Tax levy year Principal Interest Total June 15 Amount December 15 Amount 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 2026 565,000 220,603 785,603 2027 110,302 2027 110,301 Thereafter 6,605,000 1,233,525 7,838,525 Thereafter 616,763 Thereafter 616,762 9,295,000$ 2,468,214$ 11,763,214$ June 5, 2017 Coupons due on 131 180 City of Lake Forest General Obligation Bonds – 2019 April 30, 2023 Date of issue: Date of maturity:December 15, 2032 Authorized issue:$17,655,000 Denomination of bonds:$5,000 Interest rates:2.25 - 5.00% Interest dates:June 15 and December 15 Payable at:Amalgamated Bank Chicago, Illinois Redeemable Annually on December 15 Amount 2023 2,370,000$ 2024 630,000 2025 660,000 2026 695,000 2027 730,000 Thereafter 3,925,000 9,010,000$ Bond Principal and Interest Requirements Tax Levy Tax Levy Year Principal Interest Total June 15 Amount December 15 Amount 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 2026 730,000 98,213 828,213 2027 49,107 2027 49,106 Thereafter 3,925,000 262,588 4,187,588 Thereafter 131,294 Thereafter 131,294 9,010,000$ 1,173,151$ 10,183,151$ December 19, 2019 Coupons Due on 132 181 City of Lake Forest General Obligation Bonds – 2021 April 30, 2023 Date of issue: Date of maturity:December 15, 2032 Authorized issue:$7,590,000 Denomination of bonds:$5,000 Interest rates:2.00% Interest dates:June 15 and December 15 Payable at:Amalgamated Bank Chicago, Illinois Redeemable Annually on December 15 Amount 2023 590,000$ 2024 600,000 2025 615,000 2026 615,000 2027 625,000 Thereafter 4,000,000 7,045,000$ Bond Principal and Interest Requirements Tax Levy Tax Levy Year Principal Interest Total June 15 Amount December 15 Amount 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 2026 625,000 92,500 717,500 2027 46,250 2027 46,250 Thereafter 4,000,000 250,100 4,250,100 Thereafter 125,050 Thereafter 125,050 7,045,000$ 834,500$ 7,879,500$ September 15, 2021 Coupons Due on 133 182 City of Lake Forest General Obligation Bonds – 2023 April 30, 2023 Date of issue: Date of maturity:December 15, 2033 Authorized issue:$10,770,000 Denomination of bonds:$5,000 Interest rates:5.00% Interest dates:June 15 and December 15 Payable at:Amalgamated Bank Chicago, Illinois Redeemable Annually on December 15 Amount 2023 935,000$ 2024 780,000 2025 820,000 2026 860,000 2027 905,000 Thereafter 6,470,000 10,770,000$ Bond Principal and Interest Requirements Tax Levy Tax Levy Year Principal Interest Total June 15 Amount December 15 Amount 2022 935,000$ 341,050$ 1,276,050$ 2023 -$ 2023 341,050$ 2023 780,000 491,750 1,271,750 2024 245,875 2024 245,875 2024 820,000 452,750 1,272,750 2025 226,375 2025 226,375 2025 860,000 411,750 1,271,750 2026 205,875 2026 205,875 2026 905,000 368,750 1,273,750 2027 184,375 2027 184,375 Thereafter 6,470,000 1,178,250 7,648,250 Thereafter 589,125 Thereafter 589,125 10,770,000$ 3,244,300$ 14,014,300$ April 27, 2023 Coupons Due on 134 183 City of Lake Forest Debt Service Fund Combining Balance Sheet April 30, 2023 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 -$ -$ 12,565$ 928,047$ uncollectibles): Property taxes - - 154,259 - Total assets -$ -$ 166,824$ 928,047$ Liabilities -$ -$ -$ -$ Deferred inflows of resources Property taxes levied for future periods - - 154,259 - Fund Balance Fund balance- restricted for debt service - - 12,565 928,047 Total deferred inflows of resources, liabilities and fund balances -$ -$ 166,824$ 928,047$ Receivables (net of allowance for Total Liabilities 135 184 2009/2019 2010/2019 2013/2021 2015 2023 General General General General General Obligation Obligation Obligation Obligation Obligation Bonds Bonds Bonds Bonds Bonds Total 39,983$ 68,217$ 53,958$ 8,997$ 900,195$ 2,011,962$ 257,865 570,559 727,136 260,763 - 1,970,582 297,848$ 638,776$ 781,094$ 269,760$ 900,195$ 3,982,544$ -$ -$ -$ -$ -$ -$ 257,865 570,559 727,136 260,763 - 1,970,582 39,983 68,217 53,958 8,997 900,195 2,011,962 297,848$ 638,776$ 781,094$ 269,760$ 900,195$ 3,982,544$ 136 185 City of Lake Forest Debt Service Fund Combining Schedule of Revenues, Expenditures and Changes in Fund Balances Year Ended April 30, 2023 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 77,716$ 21,910$ 154,456$ -$ Investment income 1,570 517 2,214 38,999 Total revenues 79,286 22,427 156,670 38,999 Expenditures General government 20,963 9,137 - 45 Debt Service: Principal 75,000 20,701 143,507 478,748 Interest 2,213 714 10,448 48,613 Total expenditures 98,176 30,552 153,955 527,406 Excess (deficiency) of revenues over expenditures (18,890) (8,125) 2,715 (488,407) Other financing sources: Transfers in - - - - Total other financing sources (uses)- - - - Net change in fund balances (18,890) (8,125) 2,715 (488,407) Fund Balances, Beginning 18,890 8,125 9,850 1,416,454 Fund Balances, Ending -$ -$ 12,565$ 928,047$ 137 186 2009/2019 2010/2019 2013/2021 2015 2023 General General General General General Obligation Obligation Obligation Obligation Obligation Bonds Bonds Bonds Bonds Bonds Total 254,565$ 578,832$ 739,450$ 257,595$ -$ 2,084,524$ 3,897 7,722 8,812 2,333 195 66,259 258,462 586,554 748,262 259,928 195 2,150,783 56 211 475 1,000 - 31,887 190,000 385,000 545,000 355,000 - 2,192,956 63,700 192,763 189,750 260,925 - 769,126 253,756 577,974 735,225 616,925 - 2,993,969 4,706 8,580 13,037 (356,997) 195 (843,186) - - - 360,688 900,000 1,260,688 - - - 360,688 900,000 1,260,688 4,706 8,580 13,037 3,691 900,195 417,502 35,277 59,637 40,921 5,306 - 1,594,460 39,983$ 68,217$ 53,958$ 8,997$ 900,195$ 2,011,962$ 138 187 Statistical Section Contents Page Financial Trends 139 Revenue Capacity 144 Debt Capacity 152 Demographic and Economic Information 157 Operating Information 160 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. 188 City of Lake Forest Net Position by Component Last Ten Fiscal Years April 30, 2023 2014 2015 2016*2017 2018 2019 2020 2021 2022 2023 Governmental Activities Net investment in capital assets 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$ 169,967,523$ Restricted 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 50,792,460 Unrestricted 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) (9,092,750) 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$ 211,667,233$ Business-Type Activities Net investment in capital assets 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$ 37,912,290$ Restricted - - - - - - - 580,012 1,957,016 - Unrestricted 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 14,935,571 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$ 52,847,861$ Total Primary Government Net investment in capital assets 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$ 207,879,813$ Restricted 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 50,792,460 Unrestricted 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) 5,842,821 270,722,620$ 269,101,013$ 227,413,521$ 222,177,958$ 225,474,660$ 225,699,184$ 223,470,574$ 235,606,495$ 253,863,559$ 264,515,094$ *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 139 189 Change in Net Position Last Ten Fiscal years Year Ended April 30, 2023 2014 2015*2016 2017 2018 2019 2020 2021 2022 2023 Expenses Governmental Activities General government 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$ 15,254,047$ Highway and streets 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 7,992,398 Sanitation 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 2,980,137 Culture and recreation 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 12,433,798 Public safety 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 22,900,489 Interest 1,333,267 1,357,552 1,293,742 1,559,100 1,271,181 1,231,944 1,115,802 920,485 871,548 477,955 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 62,038,824 Business-Type Activities Waterworks and sewerage 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 8,456,249 Golf 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 2,259,135 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 10,715,384 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$ 72,754,208$ Program Revenues Governmental Activities Charges for services: General government 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$ 4,219,903$ Highway and streets 741,334 710,795 990,840 782,953 1,006,644 2,730,122 2,183,456 2,476,794 2,726,225 2,885,458 Sanitation 77,147 682,062 697,435 734,111 721,276 749,620 1,040,121 1,053,692 1,040,338 1,053,425 Culture and recreation 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 3,178,479 Public safety 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 2,897,404 Operating grants and contributions 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 1,259,314 Capital grants and contributions 757,239 468,255 280,675 1,174,000 356,178 505,988 448,694 777,054 2,368,237 3,357,688 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 18,851,671 Business-Type Activities Charges for services: Waterworks and sewerage 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 8,778,538 Golf 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 1,861,913 Operating grants and contributions - - - - - 228,332 - - - 138,517 Capital grants and contributions - - - - - - - - 554,466 - 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 10,778,968 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$ 29,630,639$ Net (Expense)/Revenue Governmental Activities (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)$ (43,187,153)$ Business-Type Activities (112,271) (547,260) 129,535 (1,125,919) (163,087) (136,529) (1,058,695) (95,002) 2,471,887 63,584 (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)$ (43,123,569)$ Total governmental activities program revenues Total primary government expenses Total business-type activities Total governmental activities expenses City of Lake Forest Total primary government net expense Total government program revenues Total business-type activities program revenues 140 190 Change in Net Position Last Ten Fiscal years Year Ended April 30, 2023 2014 2015*2016 2017 2018 2019 2020 2021 2022 2023 City of Lake Forest General Revenues and Other Changes in Net Position Governmental Activities Taxes: Property 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$ 33,144,358$ Sales 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 2,033,255 Income and use 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 3,774,572 Telecommunications and utility 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 3,242,737 Real estate transfer tax 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 2,125,930 Other 581,443 534,625 514,231 636,368 2,178,246 2,410,453 2,717,862 4,308,631 5,824,190 5,910,164 Investment earnings 637,193 547,118 145,329 1,042,049 1,665,391 2,215,202 1,664,355 3,564,117 (883,765) 2,778,603 Miscellaneous 669,145 73,613 - - - - - - - - Gain on sale of assets - - - - (3,874) 7,775 38,500 - - 7,000 Transfers (97,000) (168,750) (924,496) (360,000) (4,343,841) 786,850 (198,500) (29,500) (52,500) (58,796) 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 52,957,823 Business-Type Activities Investment earnings 38,550 33,408 40,362 58,366 236,990 279,189 175,969 42,285 56,757 497,116 Other - 1,621 6,033 2,450 61,835 299,176 309,870 290,648 374,139 261,369 Transfers 97,000 168,750 924,496 360,000 4,343,841 (786,850) 198,500 29,500 52,500 58,796 135,550 203,779 970,891 420,816 4,642,666 (208,485) 684,339 362,433 483,396 817,281 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$ 53,775,104$ Changes in Net Position Governmental activities 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$ 9,770,670$ Business-type activities 23,279 (343,481) 1,100,426 (705,103) 4,479,579 (345,014) (374,356) 267,431 2,955,283 880,865 332,092$ (1,621,607)$ 2,929,650$ (5,235,563)$ 3,296,702$ 2,349,467$ (2,228,610)$ 12,135,921$ 18,257,064$ 10,651,535$ *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 141 191 City of Lake Forest Fund Balances of Governmental Funds Last Ten Fiscal Years April 30, 2023 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 General Fund Nonspendable 2,126,990$ 1,648,832$ 1,272,224$ 778,160$ 150,038$ 129,280$ 143,703$ 208,661$ 91,038$ 199,053$ Restricted 957,420 957,420 - - - - - - - - Unassigned 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 31,157,853 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$ 31,356,906$ All Other Governmental Funds Nonspendable -$ 381,173$ 408,539$ 536,121$ 28,688$ 32,837$ 29,139$ 28,878$ -$ 292,047$ Restricted 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 62,488,187 Assigned 1,449,284 1,448,736 1,456,053 - - - - - - - Unassigned - (1,022,136) - - - (3,686) (743,104) (304,215) - - 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$ 62,780,234$ 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$ 94,137,140$ Total general fund governmental funds Total governmental funds 142 192 City of Lake Forest Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years Year Ended April 30, 2023 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Revenues Property taxes 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$ 33,144,358$ Other taxes 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 7,296,938 Intergovernmental revenues 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 9,450,281 Grants and contributions 962,249 950,823 1,056,523 1,419,736 997,289 2,220,550 1,082,083 1,959,289 803,304 3,495,343 Charges for services 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 10,085,851 Licenses and permits 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 3,661,327 Fines and forfeitures 297,005 287,333 260,407 321,168 345,438 355,304 271,985 260,726 256,681 252,955 Investment income (loss)610,601 524,150 115,462 989,515 1,553,167 2,043,136 1,534,251 3,531,497 (919,400) 2,533,245 Miscellaneous revenue 759,384 790,344 779,137 841,731 1,831,152 1,511,534 1,360,723 1,346,521 1,777,933 1,557,864 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 71,478,162 Expenditures General government 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 13,261,755 Highways and streets 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 5,489,525 Sanitation 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 2,752,581 Culture and recreation 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 10,123,672 Public safety 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 20,127,970 Capital outlay 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 8,971,850 Debt service: Principal 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 2,192,956 Interest 1,319,276 1,400,609 1,293,634 1,639,191 1,277,596 1,242,498 1,202,730 1,026,472 957,831 925,090 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 63,845,399 Excess (deficiency) of revenues over expenditures 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 7,632,763 Other Financing Sources (Uses) Transfers in 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 6,101,025 Transfers out (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) (6,161,696) Bonds issued - - 9,780,000 - - - - - - 10,770,000 Loan proceeds - - 830,080 - - - - - - - Premium (discount) on bonds issued 26,093 - 106,384 - - - 797,619 - 511,784 1,390,156 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 791,038 24,053 73,224 5,636,108 26,076 26,551 38,500 14,843 - 265,711 770,131 (144,697) 10,740,688 5,276,108 (2,224,670) (337,449) (57,234) (15,157) (702,244) 12,365,196 3,190,554$ 859,560$ 9,932,835$ 3,549,961$ 582,592$ 5,514,582$ 925,660$ 8,263,028$ 9,319,462$ 19,997,959$ Debt service as a percentage of 6.17%6.43%6.54%17.36%6.49%5.42%5.78%5.76%5.92%5.58% Total revenues Total expenditures Total other financing sources (uses) Net changes in fund balances noncapital expenditures 143 193 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 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% 2022 2,196,169,409 222,850,729 55,906 7,089,985 25,629,367 2,451,795,396 1.5590 7,355,386,188 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 144 194 City of Lake Forest Property Tax Rates - Direct and Overlapping Governments Based on Shields Township Last Ten Levy Years 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Bonds 0.088 0.090 0.067 0.059 0.060 0.066 0.074 0.077 0.077 0.076 Corporate 0.580 0.590 0.619 0.603 0.600 0.620 0.646 0.663 0.683 0.709 Firemen's Pension 0.052 0.054 0.053 0.050 0.061 0.065 0.077 0.093 0.098 0.099 IMRF 0.037 0.038 0.037 0.035 0.035 0.035 0.037 0.039 0.040 0.040 Library 0.152 0.155 0.153 0.146 0.145 0.149 0.157 0.166 0.170 0.176 Library Sites & Building 0.017 0.017 0.017 0.016 0.016 0.016 0.017 0.018 0.018 0.019 Parks/Park Maintenance 0.191 0.194 0.196 0.187 0.184 0.188 0.197 0.225 0.229 0.236 Police Pension 0.076 0.080 0.082 0.078 0.083 0.087 0.109 0.125 0.134 0.135 Ptab/CE Recapture 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.011 0.007 Recreation for Handicapped Rec.0.018 0.018 0.018 0.018 0.018 0.019 0.020 0.021 0.021 0.022 Social Security 0.037 0.038 0.037 0.035 0.035 0.035 0.037 0.039 0.040 0.040 City Direct Rates *1.248 1.274 1.279 1.227 1.237 1.280 1.371 1.464 1.522 1.559 Overlapping Rates College of Lake County 0.296 0.306 0.299 0.285 0.281 0.282 0.282 0.290 0.293 0.296 County of Lake 0.663 0.682 0.663 0.632 0.622 0.612 0.597 0.598 0.598 0.589 Lake County Forest Preserve 0.218 0.210 0.208 0.193 0.187 0.182 0.180 0.182 0.179 0.173 North Shore Sanitary District 0.164 0.169 0.166 0.157 0.153 0.153 0.153 0.157 0.158 0.160 School District 67, Elem.1.424 1.452 1.429 1.367 1.355 1.391 1.472 1.551 1.606 1.652 School District 115, High School 1.420 1.450 1.409 1.329 1.314 1.336 1.375 1.445 1.494 1.535 Township 0.037 0.039 0.038 0.036 0.035 0.035 0.036 0.037 0.037 0.048 Township Road and Bridge 0.032 0.033 0.032 0.031 0.030 0.031 0.032 0.033 0.034 0.026 Total tax rate 5.502 5.615 5.523 5.257 5.214 5.302 5.498 5.757 5.922 6.038 City's share of total tax rate 23%23%23%23%24%24%25%25%26%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 145 195 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 Kelmscott Park Apartments LLC 15,858,226$ 1 0.65% Chicago Title Land Trust Company 13,635,533 2 0.56% Abbot Laboratories 12,910,490 3 0.53% Lake Forest Place LLC 12,740,128 4 0.52% Chicago Bears Football Club, Inc 11,290,096 5 0.46%5,400,570$ 9 0.24% Chicago Title Land Trust Company 11,251,294 6 0.46% CAI Investment Lake Forest Global 10,243,283 7 0.42% Conway Gateway LLC 9,939,028 8 0.41% SOT North Field LP 9,614,340 9 0.39% Hospira Inc 7,946,882 10 0.32%18,429,766 1 0.82% Lake Products, Inc 13,924,734 2 0.62% The Presbyterian Home 13,000,708 3 0.58% CBIZ Property Tax Solutions 9,053,796 4 0.40% Trustmark Insurance Co 7,609,239 5 0.34% Northwestern Lake Forest Hospital 7,324,881 6 0.33% Lake Forest Landmark Co. LLC 6,721,223 7 0.30% Lake Forest Landmark II 5,723,477 8 0.25% Riggs & Co.5,262,931 10 0.23% 115,429,300$ 4.71%92,451,325$ 4.10% 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. 2023 Column is 2022 Assessed Valuation 2014 Column is 2013 Assessed Valuation 2023 2014 146 196 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 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 35,063,302 34,914,741 99.58%960 34,915,701 99.58% 2021 35,959,054 35,808,504 99.58%1,484 35,809,988 99.59% 2022 37,642,488 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 147 197 City of Lake ForestTax Extensions for City FundsLast Ten Levy Years2013 2014 2015 2016 2017 2018 2019 2020 2021 2022General 0.580 0.590 0.619 0.603 0.600 0.617 0.646 0.663 0.683 0.709IMRF/Social Security 0.074 0.076 0.074 0.070 0.070 0.071 0.074 0.078 0.079 0.081Firefighter Pension 0.052 0.054 0.053 0.050 0.061 0.065 0.077 0.093 0.098 0.099Police Pension0.076 0.080 0.082 0.078 0.083 0.087 0.109 0.125 0.134 0.135Parks and Recreation0.191 0.194 0.196 0.187 0.184 0.188 0.196 0.224 0.229 0.236Special Recreation0.018 0.018 0.018 0.018 0.018 0.019 0.020 0.021 0.021 0.022General Obligation Bond 20080.037 0.037 0.026 0.000 0.000 0.000 - - - - General Obligation Bond 20090.013 0.013 0.009 0.012 0.012 0.011 0.011 0.011 0.011 0.008General Obligation Bond 20100.012 0.025 0.015 0.020 0.020 0.019 0.019 0.019 0.019 0.018General Obligation Bond 20130.026 0.015 0.010 0.018 0.018 0.027 0.027 0.027 0.027 0.023General Obligation Bond 2015- - 0.008 0.009 0.010 0.009 0.009 0.009 0.009 0.008Total tax rate1.079 1.102 1.110 1.065 1.076 1.113 1.188 1.269 1.311 1.339Data SourceOffice 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.148198 City of Lake Forest Sales Tax Base and Number of Principal Payers Taxable Sales by Category - Home Rule Sales Tax Last Ten Calendar Years 2014 2015 2016 2017 2018 2019 2020 2021 2022 General Merchandise 7,005$ 7,471$ 5,072$ 4,358$ 4,215$ 5,854$ 4,980$ 2,427$ 6,183$ Food 105,771 96,009 92,936 93,838 95,457 144,134 189,599 203,271 205,928 Drinking and Eating Places 180,023 163,447 173,473 182,278 177,620 261,770 216,636 290,619 411,141 Apparel 68,291 75,606 73,785 72,540 67,069 116,944 115,308 181,680 222,405 Furniture & H.H. & Radio 39,494 36,526 32,774 28,424 29,524 47,907 62,235 111,261 92,924 Lumber, Building, Hardware - - 7,537 8,238 9,633 17,362 27,244 30,082 34,466 Automobile and Filling Stations 34,895 28,267 26,735 30,895 35,146 48,650 45,234 65,741 77,445 Drugs and Miscellaneous Retail 117,262 118,740 117,224 102,558 103,843 154,528 179,191 551,958 636,194 Agriculture and All Others 105,139 129,721 116,945 105,670 66,743 146,885 148,739 217,430 289,167 Manufacturers 7,095 (3,818) - - - - - 12,293 16,700 Censored categories - - - - - - - - - Total 664,975$ 651,969$ 646,481$ 628,799$ 589,250$ 944,034$ 989,166$ 1,666,760$ 1,992,553$ 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%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. 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. 149 199 City of Lake Forest Sales Tax Base and Number of Principal Payers Taxable Sales by Category - Municipal Sales Tax Last Ten Calendar Years 2013 2014 2015 2016 2017 2018 2019*2020 2021 2022 General Merchandise 19,656$ 14,010$ 14,930$ 11,412$ 10,496$ 10,069$ 8,964$ 5,204$ 2,465$ 6,204$ Food 593,446 673,803 591,893 564,049 550,591 535,167 528,469 615,073 594,801 614,841 Drinking and Eating Places 338,382 364,221 329,303 350,024 372,173 362,713 349,961 224,312 297,355 416,955 Apparel 136,270 136,582 151,212 147,576 145,141 134,201 146,455 115,423 182,571 222,670 Furniture & H.H. & Radio 77,642 78,988 73,061 65,571 56,848 59,046 66,569 62,239 111,580 93,634 Lumber, Building, Hardware 19,724 - - 15,076 16,479 19,267 21,891 27,245 30,893 34,867 Automobile and Filling Stations 241,339 178,178 133,684 139,764 141,260 131,243 575,290 134,743 170,053 198,011 Drugs and Miscellaneous Retail 433,159 430,482 414,407 431,966 399,115 381,239 393,920 391,545 879,413 924,313 Agriculture and All Others 285,401 255,189 295,974 271,061 246,697 166,637 222,162 170,645 248,950 325,478 Manufacturers - 14,415 (5,107) - - - - - 13,645 23,220 Censored categories - - - - - - - - - - Total 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$ 2,860,192$ Total Number of Payers 637 637 673 687 687 604 578 510 2897 4030 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 $400,000 was received in November 2019 150 200 City of Lake Forest Direct and Overlapping Sales Tax Rates Last Ten Fiscal Years Fiscal Year City Direct Rate State Rate Metra Rate Special County Rate Total 2014 1.50%5.00%0.50%0.50%7.50% 2015 1.50%5.00%0.50%0.50%7.50% 2016 1.50%5.00%0.50%0.50%7.50% 2017 1.50%5.00%0.50%0.50%7.50% 2018 1.50%5.00%0.50%0.50%7.50% 2019 1.50%5.00%0.50%0.50%7.50% 2020 2.00%5.00%0.50%0.50%8.00% 2021 2.00%5.00%0.50%0.50%8.00% 2022 2.00%5.00%0.50%0.50%8.00% 2023 2.00%5.00%0.50%0.50%8.00% Data Source City records The City of Lake Forest became a home rule community in November 2004. The City increased the home rules sales tax by .5% July 1, 2019 151 201 City of Lake Forest Ratios of Outstanding Debt by Type Last Ten Fiscal Years Governmental Activities Business-Type Activities Ratio of Total Percentage Total Fiscal General Installment General Total Outstanding Debt of Outstanding Year Obligation Purchase Obligation Revenue Primary To Equalized Personal Debt Per Ended Bonds Contracts Bonds Bonds Government Assessed Valuation*Income*Capita* 2014 35,852,197$ - 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 2023 35,806,171 - 10,606,327 - 46,412,498 1.91%2.41%2,396.35 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. 152 202 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 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 38,929,009 1,640,674 37,288,335 0.52%1,924.56 2022 38,929,009 1,289,571 37,639,438 0.52%1,942.68 2023 46,412,498 1,766,088 44,646,410 0.61%2,305.28 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. 153 203 City of Lake Forest Direct and Overlapping Governmental Activities Debt April 30, 2023 Percentage City of Debt Applicable Lake Forest Gross to the City of Share Governmental unit Debt Lake Forest*of Debt Lake County 140,400,000$ 9.94%13,955,760$ Lake County Community College #532 84,145,000 10.48%8,818,396 Lake County Forest Preserve District 166,060,000 9.94%16,506,364 School District #67 2,555,000 100.00%2,555,000 School District #103 6,395,000 0.01%640 High School District #115 14,200,000 79.50%11,289,000 Subtotal, overlapping debt 413,755,000 53,125,160 City of Lake Forest direct debt 35,806,171 100.00%35,806,171 Total direct and overlapping debt 449,561,171$ 88,931,331$ 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. 154 204 City of Lake Forest Legal Debt Margin Information Last Ten Fiscal Years 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 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. 155 205 City of Lake Forest Last Ten Fiscal Years Fiscal Gross Less: Operating Net Available Debt Service Year Revenue Expenses Revenue Principal Interest Coverage 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 2023 11,522,792 6,736,826 4,785,967 1,976,252 434,286 3.85 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 156 206 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 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% 2023 *19,368 (A)2,426,166,029 125,267 1,928,239,344 99,558 3.5% (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 Fiscal Year 2023 the City updated and used 2020 census data 157 207 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 1,523 1 7.86%1,600 1 8.26% Abbott 1,140 2 5.89% Hospira Inc.934 3 4.82%1,350 2 6.97% Pactiv Corporation 494 4 2.55%800 3 4.13% Trustmark Insurance Company 490 5 2.53%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 319 7 1.65%350 6 1.81% Lake Forest Elem. S.D. No. 67 305 8 1.57% Packaging Corporation of America 295 9 1.52%200 10 1.03% City of Lake Forest 212 10 1.09%224 8 1.16% Brunswick Corporation - 200 9 1.03% 11977 6240 Data Source City staff contacted companies via mail. 2023 2014 158 208 City of Lake Forest Full-Time Equivalent Employees Last Ten Fiscal Years Full-Time-Equivalent Budgeted Employees as of April 30 Function/Program 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 General Government Administration 25 25 25.0 25.4 23.5 23.8 23.75 24.75 24.75 25.75 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 32 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 8.0 9.0 7.0 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 7 7 7 7 7 7 7 7 7 7 Engineering 5 5 5 5 5 5 5 5 5 5 Streets 8 7.5 7.5 8.0 8.0 8.0 8.0 8.0 8.0 8.0 Sanitation 11 10.5 10.5 10.0 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 6.5 6.5 6.5 6.5 6.5 6.5 6.5 6.5 Water and Sewer 9 9 8.5 8.5 8.5 8.5 8.5 8.5 8.5 8.5 Parks 15.4 15.4 15.4 15.0 15.0 15.0 15.0 15.0 15.0 15.0 Recreation 15.4 15.4 15.4 16.0 16.0 16.0 16.0 16.0 16.0 16.0 Golf Course 2.2 2.2 2.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Cemetery 2 2 2 2 3 3 3 3 3 3 Senior Resources 3 3 3 3 3 3 3 3 3 3 Sub - total City 224 224 214 213.4 209.5 209.75 209.75 210.75 210.75 211.75 Library 28.2 28.2 29.2 30.5 30.5 31.0 30.0 31.0 30.0 26.0 Total all 252.2 252.2 243.2 243.9 240 240.75 239.75 241.75 240.75 237.75 Data Source City Departments and employee totals as of April 30th 159 209 City of Lake Forest Operating Indicators Last Ten Fiscal Years Function/Program 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 General Government City Clerk Real Estate Transfer Tax (1) Number of Transactions 440 394 355 361 425 418 369 663 637 427 Rebates Issued 67 40 44 37 40 45 33 63 67 45 Birth Certificates Issued 2,250 2,556 2,575 2,474 2,807 2,759 2,525 2,617 3,212 3,385 Passports Issued (2)0 0 0 0 0 0 0 0 0 0 Community Development Building permits issued 3,418 3,667 3,855 3,632 3,753 4,275 3,716 3,847 4,446 4,612 Residential construction 13 20 27 21 9 13 18 29 32 33 Commercial construction 1 1 1 1 4 - 1 2 2 2 Building inspections conducted 8,651 9,657 11,009 11,707 10,798 11,214 10,586 10,466 10,065 10,065 Public Safety Fire protection I.S.O. rating 4 4 4 3 3 3 3 3 3 3 Number of calls answered EMS 1,574 1,785 1,712 1,923 1,909 1,839 2,232 1,868 2,159 2,344 Fire 1,497 1,503 1,367 1,385 1,448 1,450 1,448 1,127 1,403 1,436 Police (calendar year) Non traffic arrests 191 89 166 129 76 157 83 80 95 49 Parking violations 5,979 5,250 3,907 5,396 4,325 6,891 3,748 1,107 2,242 2,043 Traffic violations 1,877 1,741 1,985 1,718 949 1,909 1,583 1,487 1,336 1,518 Public Works Streets Street resurfacing (miles) (calendar year)5.00 5.50 2.40 3.28 2.63 2.20 3.40 1.90 1.20 3.10 Number of snow events Salting 27 21 24 15 10 9 6 5 5 2 Plowing 21 20 10 5 10 9 10 14 13 11 Inches of snow 48 50 24 22 45 46 26 63 37 29 Sanitation Refuse collection customers 6,462 6,654 6,295 6,467 6,467 6,484 6,503 6,527 6,550 6,550 Parks and Recreation (3) Fitness Number of programs 336 181 346 215 200 257 246 682 70 159 Units of participation 1,587 1,216 1,271 1,473 1,430 1,446 1,442 2,079 1,502 1,635 Athletics Number of programs 270 341 168 275 237 466 460 792 213 411 Units of Participation 2,524 2,282 1,348 2,006 2,026 1,931 1,958 561 1,901 3,169 Lakefront, Early Childhood Education and Lifetime Activities Number of programs 294 126 130 176 161 228 223 298 124 136 Units of participation 1,380 752 1,393 1,221 1,385 1,679 1,685 443 1,233 977 Cultural Arts/Special Events Number of programs 286 87 147 286 246 310 312 550 259 591 Units of participation 1,999 1,329 1,579 4,133 4,743 5,064 5,078 1,698 5,269 6,688 160 210 City of Lake Forest Operating Indicators (Continued) Last Ten Fiscal Years Function/Program 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Wildlife Discovery Center, Ridge Teams Course and Adventure Number of programs 47 20 20 26 34 31 33 24 23 37 Units of participation 360 2,263 2,802 3,685 2,148 2,233 2,224 98 698 657 Developed parks and recreation areas 10 10 11 11 11 10 11 11 11 11 Developed park acreage 404 404 405 405 405 344 344 344 344 344 Sites with playgrounds 9 9 9 9 9 9 9 9 9 9 Sites with baseball diamonds 8 8 8 8 8 8 7 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 4 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 29,435 27,956 29,445 27,101 24,631 26,184 24,666 24,508 26,293 26,799 Daily fee 17,449 17,646 20,478 19,755 18,660 21,172 20,089 20,380 22,112 20,831 Seasonal 11,986 10,310 8,967 7,346 5,971 5,012 4,577 4,128 4,181 5,968 Water New Connections (tap-ons)28 33 66 30 23 29 21 27 15 12 Meters in operation 6,751 6,764 6,810 6,854 6,854 6,840 6,850 6,899 6,911 6,920 Meters connected to sewerage system 6,587 6,577 6,645 6,718 6,778 6,766 6,789 6,832 6,842 6,854 Average daily consumption (MGD)3.652 3.250 3.162 3.499 3.550 3.430 3.132 3.400 3.804 3.324 Peak daily consumption (MGD)8.611 7.345 8.268 8.315 8.926 7.247 7.916 8.180 8.482 8.579 Rated daily pumping capacity (MGD)14 14 14 14 14 14 14 14 14 14 Total gallons pumped during fiscal year (in millions)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 1,213.4 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 148,318 146,214 146,153 221,568 248,598 147,024 149,026 350,692 366,063 411,037 Registered borrowers 15,403 15,440 15,460 15,518 13,588 13,946 7,908 9,408 9,377 6,180 Fiscal yearbooks, items or materials circulation 450,876 410,852 383,561 376,144 551,232 366,128 346,603 262,366 350,541 288,572 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 161 211 City of Lake Forest Capital Asset Statistics Last Ten Fiscal Years Function/Program 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Public Safety Police Stations 1 1 1 1 1 1 1 1 1 1 Vehicles 23 23 21 24 24 23 23 23 23 23 Fire protection Stations 2 2 2 2 2 2 2 2 2 2 Vehicles 17 15 17 17 15 18 18 19 23 23 Public Works Bridges Vehicle 14 14 14 14 14 14 14 14 14 14 Pedestrian 12 12 12 12 12 13 13 13 13 13 Streets Streets (centerline miles)119.24 119.24 119.24 119.24 119.24 119.24 119.24 119.24 119.24 119.24 Streetlights Gas 438 438 438 438 438 438 438 438 438 438 Electric 1,536 1,570 1,570 1,570 1,570 1,570 1,570 1,570 1,570 1,570 Storm sewer (miles)219.41 219.41 219.43 219.43 219.46 219.54 219.54 219.54 219.54 220.12 Parks and Recreation Acreage 404 404 405 405 405 344 344 344 344 344 Water Water mains (miles)165.79 166.44 166.44 166.89 167.68 167.68 167.73 167.84 167.84 168.08 Fire hydrants 1,362 1,511 1,511 1,511 1,519 1,374 1,400 1,400 1,400 1,416 Wastewater Sanitary sewers (miles)138.95 138.95 139.43 139.43 140.25 140.25 140.25 140.25 140.25 140.41 Data Source City departments N/A = data not available 162 212 The City of Lake Forest CITY COUNCIL MEETING Proceedings of the Monday, October 16, 2023 City Council Meeting – City Council Chambers 220 E Deerpath, Lake Forest, IL 60045 CALL TO ORDER AND ROLL CALL: Honorable Mayor Tack called the meeting to order at 7:27 p.m., and City Clerk Margaret Boyer called the roll of Council members. Present: Honorable Mayor Tack, Alderman Novit, Alderman Notz, Alderman Powers, Alderman Preschlack, Alderman Goshgarian, Alderman Weber, and Alderman Walther Absent: Alderman Waldeck CALL TO ORDER AND ROLL CALL PLEDGE OF ALLEGIANCE was recited by all. REPORTS OF CITY OFFICERS COMMENTS BY MAYOR Mayor Tack congratulated the Finance Department for a job well done that allows for the City to be successful in achieving national recognition. COMMENTS BY CITY MANAGER A. Community Survey - George Issakoo, Assistant City Manager and - Ryan Murray, ETC Institute City Manager, Jason Wicha shared a summary of the community survey noting the responses will help the city make informed future decisions and allocate future funding. He then introduced Assistant City Manager, George Issakoo who reflected on the process and vendor highlighting that the vendor was chosen for its flexibility. He stated that the results are a foundational tool for the strategic plan envisioning process and are available on the City’s website. He then introduced Ryan Murray of ETC. Mr. Murray reviewed the purpose and methodology of the survey; he also reviewed several survey results to include benchmarking and top priorities. In summary Mr. Murray reported on the overall satisfaction rate including issues with infrastructure and the quality of staff. The City Council had lengthy discussion that included best practices, focus/peer groups, the interactive data dashboard, and actionable items. City Manager Wicha thanked the entire city staff who embrace the high expectations each day. OPPORTUNITY FOR CITIZENS TO ADDRESS THE CITY COUNCIL None this evening. COMMITTEE REPORTS 213 Proceedings of the Monday, October 16, 2023 City Council Meeting FINANCE COMMITTEE 1. Acknowledge Receipt of the FY2023 Treasurer’s Report Diane Hall, Assistant Finance Director stated that pursuant to Illinois Statute, a Treasurer’s Report must be filed with the City Clerk, the County Clerk, and published in a Lake Forest newspaper within six months after the end of each fiscal year. She stated that the report will be published in the October 19, 2023, edition of the Lake Forester. COUNCIL ACTION: Acknowledge receipt of the FY2023 Treasurer’s Report Mayor Tack asked for a motion to acknowledge the receipt of the F2023 Treasurer’s Report. Alderman Notz made a motion to adjourn, seconded by Alderman Goshgarian. Motion carried unanimously by voice vote. 2. GFOA Triple Crown Award Presentation and Distinguished Budget Presentation Award Finance Committee Chairman Preschlack reported successfully achieving this award puts the City in a very exclusive club as a GFOA “Triple Crown” winner for the 2nd year in a row. The City has earned the GFOA Financial Reporting Award 44 consecutive years and earned the GFOA Budget Presentation Award for 8 consecutive years, including recently being notified of receiving the award for the City’s FY24 budget. Additionally, the City has earned the GFOA PAFR award for 2 consecutive years. Chairman Preschlack thanked the Finance Department for all their work. ITEMS FOR OMNIBUS VOTE CONSIDERATION 1. Approval of October 2, 2023, City Council Meeting Minutes 2. Consideration of Adoption of Updated Versions of Previously Adopted State and National Life Safety and Building Codes Used by the City. (Final Approval) 3. Consideration of a Request to Waive the Fidelity Bond Requirement in Connection with Holding a Raffle in the City of Lake Forest for Northwestern Medicine Lake Forest Hospital and The Women’s Board of Northwestern Medicine Lake Forest Hospital (Approval by Motion) 4. Approve the contract to Camp Nageela Midwest, dba Camp Henry Horner in the amount of $34,000. 5. Consideration of an Ordinance for 797 Summit Avenue Approving a Recommendation 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 for 334 Circle Lane and 797 Summit Avenue. (First Reading, and if Desired by the City Council, Final Approval) COUNCIL ACTION: Approve the six (6) omnibus items as presented Mayor Tack asked members of the City Council if there were any items that they would like removed or taken separately. Seeing none, he asked for a motion. 214 Proceedings of the Monday, October 16, 2023 City Council Meeting Alderman Weber made a motion to approve the six (6) Omnibus items as presented, seconded by Alderman Goshgarian. The following voted “Aye”: Alderman Novit, Notz, Powers, Preschlack, Goshgarian, Weber, and Walther. The following voted “Nay”: none. 7-Ayes, 0-Nays, motion carried. Information 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. OLD BUSINESS NEW BUSINESS 1. Items Related to Expanded Use of Elawa Farm by the Elawa Farm Foundation including Consideration of Amendments to the Special Use Permit as Recommended by the Zoning Board of Appeals, Consideration of an amended Lease Agreement, and Consideration of a Request for a Short-Term Loan. Elawa Farm is located at 1401 Middlefork Drive. (Waive First Reading and Grant Final Approval of an Ordinance and Grant Approvals by Motion) City Manager Jason Wicha gave an overview to date of how we arrived to this evening, he acknowledged the leadership of the Elawa Farm Foundation Board over the years and Laura Calvert as a remarkable partner and a steward of the property. He then introduced Elizabeth Holleb, Director of Finance in the absence of Community Development Director Catherine Czerniak. Ms. Holleb reviewed the three Council actions, these included a motion to amend the lease agreement, approve a loan in concept in an amount not to exceed 1 million dollars and the unanimous recommendation of the Zoning Board of Appeals to amend the current special use permit. City Manager Wicha then introduced Laura Calvert. Ms. Calvert shared the planned expansion goals to include, programs, farm animals, rest areas all with a low impact to surrounding neighbors. She also went on to explain concept planned uses for buildings. Phase I and Phase II timelines were shared to include a daytime café, dinner on the farm, a learning kitchen and a hoop house. Ms. Calvert made clear the changes were not to extend or expand private rentals. The City Council had discussion on the positive direction the Farm is moving in along with the excellent stewardship on the farm. Joe Weiss offered his comments to the Council in support of the Council actions. COUNCIL ACTION: Waive first reading and grant final approval of an Ordinance amending the Special Use Permit for Elawa Farm at 1401 Middlefork Drive as recommended by the Zoning Board of Appeals and as detailed in the Ordinance. Alderman Novit made a motion to Waive first reading and grant final approval of an Ordinance amending the Special Use Permit for Elawa Farm at 1401 Middlefork Drive as recommended by the Zoning Board of Appeals and as detailed in the Ordinance, seconded by Alderman Preschlack. The following voted “Aye”: Alderman 215 Proceedings of the Monday, October 16, 2023 City Council Meeting Novit, Notz, Powers, Preschlack, Goshgarian, Weber, and Walther. The following voted “Nay”: none. 7-Ayes, 0- Nays, motion carried. AND By motion, approve an amended lease agreement with the Elawa Farm Foundation. Alderman Powers made a motion to approve an amended lease agreement with the Elawa Farm Foundation, seconded by Alderman Notz. The following voted “Aye”: Alderman Novit, Notz, Powers, Preschlack, Goshgarian, Weber, and Walther. The following voted “Nay”: none. 7-Ayes, 0-Nays, motion carried. AND By motion, approve in concept a loan by the City to the Elawa Farm Foundation in an amount not to exceed $1 million. Alderman Goshgarian made a motion to approve in concept a loan by the City to the Elawa Farm Foundation in an amount not to exceed $1 million, seconded by Alderman Weber. The following voted “Aye”: Alderman Novit, Notz, Powers, Preschlack, Goshgarian, Weber, and Walther. The following voted “Nay”: none. 7-Ayes, 0- Nays, motion carried ADDITIONAL ITEMS FOR COUNCIL DISCUSSION/COMMENTS BY COUNCIL MEMBERS ADJOURNMENT There being no further business Mayor Tack asked for a motion to adjourn. Alderman Preschlack made a motion to adjourn, seconded by Alderman Weber. Motion carried unanimously by voice vote at 8:37 p.m. Respectfully Submitted, Margaret Boyer, City Clerk A video of the City Council meeting is available for viewing at the Lake Forest Library and on file in the Clerk’s office at City Hall. You can also view it on the website by visiting www.cityoflakeforest.com. Click on I Want To, then click on View, then choose Archived Meetings Videos. 216 217 218 October 31, 2023 Mayor Tack The City of Lake Forest 220 E. Deerpath Rd. Lake Forest, IL 60045 Dear Mayor Tack, 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 3,000. Thank you for your consideration. Sincerely, Chris Pier Chris Pier Associate Athletic Director – Budget & Compliance 219 220 221 222 223 224 225 226 227 228 229 230 231 232 233 234 235 236 237 238 239 240 241 242 243 244 245 246 247 248 249 250 251 252