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February 08, 2005

Mayor Krajewski called the Workshop meeting of the Village Council of the Village of Downers Grove to order at 5:30 p.m. in the Council Chambers of the Village Hall.

Present:Mayor Brian Krajewski; Commissioners Marilyn Schnell, Martin Tully, Sue McConnell, Ron Sandack, Stan Urban; Village Manager Riccardo Ginex

Absent: Commissioner Mark Zabloudil

Mayor Krajewski asked for a Motion to move into Executive Session. Commissioner Tully moved to go into Executive Session pursuant to Section 2©(1) of the Illinois Open Meetings Act to consider personnel. Commissioner Schnell seconded the Motion.

VOTE : AYE – Commissioners Tully, Schnell, McConnell, Sandack, Urban, Mayor Krajewski NAY – None

Mayor Krajewski declared the Motion carried and the Council convened into Executive Session at 5:35 p.m.

Mayor Krajewski reconvened the Workshop meeting of the Village Council of the Village of Downers Grove at 6:30 p.m. in the Council Chambers of the Village Hall.

Present:Mayor Brian Krajewski; Commissioners Marilyn Schnell, Sue McConnell, Martin Tully, Mark Zabloudil, Ron Sandack, Stan Urban; Village Manager Riccardo Ginex; Village Attorney Enza Petrarca; Village Clerk April Holden

Absent:None

Visitors: Press: Kevin Stahr, Downers Grove Reporter Residents: Mike Parilla, 1409 Ridgewood Circle; William Waldack, 1409 Willard Pl.; Mike Busse, Community Bank of Downers Grove, 1111 Warren; Barry Peckhart, 1028 61st St.; Liz Chalberg, EDC ; David Weiher, Chuck’s Meat Market, 933 Curtiss Staff: Lori Sommers, Planner; Kathy DesMarteau, Planning & Community Development; Dave Van Vooren, Deputy Village Manager; Bob Tutko, Deputy Fire Chief; Mary Scalzetti, Director, Tourism & Events; Rita Trainor, Director, Financial Services; Phil Ruscetti, Fire Chief; Mike Baker, Assistant Village Manager

Mayor Krajewski explained that Council Workshop meetings are held the second and fourth Tuesdays at 6:30 p.m. The meetings are video taped live and for later cable cast over cable channel 6.

The Workshop meeting is intended to provide Council and the public with an appropriate forum for informal discussion of any items intended for future Council consideration or just for general information. No formal action is taken at Workshop meetings.

The public is invited to attend and encouraged to comment or ask questions in an informal manner on any of the items being discussed or on any other subject. The agenda is created to provide a guideline for discussion.

MANAGER

Bids:

2005 Heritage Festival Amusement Ride Agreement. Manager Ginex asked Mary Scalzetti, Director, Tourism & Events, to address this item.

Mary Scalzetti , Director, Tourism & Events, said the Tourism & Events Department received three responses to the amusement ride RFP for a company to operate the rides at the 2005 Heritage Festival. Proposals were received from Astro Amusement Company, All-Around Amusement Company, and Windy City Amusement Company. All three were reviewed by staff and the Events Subcommittee. The Events Subcommittee, at their January 14, 2005 meeting, made a motion to recommend to the full Tourism and Events Commission the continued use of Astro Amusement as the ride vendor for the 2005 Festival. The Tourism and Events Commission, at their January 20, 2005 meeting, concurred with the Events Subcommittee in recommending the continued use of Astro Amusements Co., Inc., for the 2005 Heritage Festival. Astro has proven they can handle an event of this magnitude and has provided quality service. We will be their main event that weekend. The Village will receive $600 per concession (game) at the event and $900 per food concession. Ms. Scalzetti explained the percentages of the ride revenue receipts. Astro employees having contact with children will undergo a fingerprint/background check with the cost split between the Village and Astro. Astro supports the community and our event by donating money for portable toilets and by donating 550 special tickets for sponsorship. Astro also provides extras which make the ride midway area attractive.

Regarding prices, Ms. Scalzetti said a sheet of 30 pre-sale tickets will be $22.00. Tickets will be $1.00 each at the event. Thursday night pay-one-price will be $15.00 and the Friday morning kiddie pay-one-price will be $10.00. Individuals may use presale tickets or purchase individual tickets for the Thursday night preview rides. The amount of tickets per ride will remain the same.

Ms. Scalzetti discussed the alternatives of Windy City Amusement Company and All-Around Amusement. Windy City would provide ticket sellers and would donate 1000 complimentary ride tickets for sponsors. The Committee was concerned that there would not be Village staff in the ticket booths. Regarding All-Around Amusement, they would offer 1000 complimentary ride tickets for sponsors. They offered $100 more per food concession and $400 more per game concession than the other vendors. They offered 60% of ride gross over $1.00; however, the Commission felt that this offer would not be a value if they could not produce the revenue. Ms. Scalzetti said All-Around Amusements provided the ride services for Lisle’s Eyes to the Skies Festival. A Commission member attended this event and felt that the rides did not compare, they were more costly, there were not as many of the larger rides, and they were not of the quality of Astro rides.

Ms. Scalzetti said Astro Amusement Company has been providing ride services in Downers Grove since 1985. They have quality rides and their service has been outstanding. They have been versatile and easy to work with over the years. Astro is willing to work with us to ensure the safety of our children. Ms. Scalzetti said that the State of Illinois is in the process of working with amusement companies to formulate a licensing process which will include fingerprinting and background checks of amusement employees. Carol Stream already utilizes a process where fingerprinting and background checks are performed. We are joining them in being proactive in order to prevent any future incidents.

Ms. Scalzetti said staff recommends awarding the 2005 Heritage Festival amusement contract to Astro Amusement Company, Inc.

Commissioner McConnell asked for a comparison between last year to this year regarding the split and what the Village will be getting, and the prices.

Ms. Scalzetti said the percentage on the ride revenue will remain the same at 40% of the ride gross from $0 to $100,000; 43% of the ride gross from $100,000 to $150,000; 45% of the ride gross from $150,000 to $225,000; and 50% of the ride gross over $225,000. The kiddie rides on Friday morning will go up $1.00. The presale tickets will increase from $20.00 to $22.00. It will take the same number of tickets as last year to go on the rides.

Commissioner Urban asked if Ms. Scalzetti could explain why All-Around Amusements projects revenue of $50,000 to $60,000 more than the other vendors. Ms. Scalzetti said they were unable to confirm this as the municipalities they checked had events that were not of the size and scope of the Heritage Festival. To determine revenues Ms. Scalzetti used the revenue amount produced last year and applied the percentages the vendors supplied. She said the Commission is not convinced the other vendors can produce the revenue Astro did last year.

Commissioner Urban asked how long All-Around Amusements has been at Lisle.

Ms. Scalzetti said they have been there for a couple of years. Lisle’s event is 1 ½ days longer than the Heritage Festival, but produces less revenue.

Regarding fingerprinting, Commissioner Urban asked if Astro is asking the Village to pay for a portion of this expense. Ms. Scalzetti said we negotiated with Astro. She estimates the cost to be between $5,000 and $8,000 total for fingerprinting and background checks depending on how many people will have actual contact with children.

Commissioner Urban said he thinks Lisle demands that all of the amusement ride staff cover the entire cost of the fingerprinting and background checks themselves. He asked if Ms. Scalzetti could confirm this.

Ms. Scalzetti said the only vendor she knows of that has been asked for fingerprints is Astro in working with Carol Stream. She said she would check on this.

Commissioner Urban asked if the food concessions would be the same as last year. Ms. Scalzetti said they would be the same.

Commissioner Tully said the fingerprinting provisions were initially developed through an addendum and then worked into the contract and expanded upon since the 2003 Heritage Festival. He said in order to get a license the applicant needs to submit fingerprints for all those workers who would be involved in the Festival who would potentially have physical contact with those in attendance at the Festival. Ms. Scalzetti said that was correct. The workers would have to go to a State approved facility for fingerprinting.

Commissioner Tully said the vendor would need to submit names to the Village in advance of the event and after that time they would not be allowed to add anyone. He asked how far in advance of the Festival they would need to be fingerprinted. Ms. Scalzetti said it would be 30 to 60 days.

Commissioner Tully asked about a financial incentive in the contract to make sure there are no direct contact employees who have not been fingerprinted at the event. He said the Village has the right to refuse admission to the Festival grounds to anyone without the Village-issued name tag. He said he recalled a provision in the contract that stipulated if someone was at the site who was not properly screened and identified there was a financial penalty to Astro in terms of forfeiting some portion of the ride revenue. He said this was in the form of a bond or letter of credit so the Village could immediately act upon it if necessary. He asked if that provision is in the proposed contract. Ms. Scalzetti responded that it is not in the proposed contract. It was put in the contract after an incident in order for Astro to prove themselves to the Village. They have worked well with the Village and the language was removed.

Commissioner Tully said he would like to have a financial incentive included in the contract. Ms. Scalzetti said this could be added.

2005 Heritage Festival Sound Contract. Ms. Scalzetti said the Tourism and Events Commission, at their January 20, 2005 meeting, unanimously recommended the services of R.J. Recording as the sound vendor for the 2005 Heritage Festival. R.J. Recording was the successful bidder in 2003 through the RFP process. In the 2003 contract there was a renewal clause. R.J. Recording would like to exercise the renewal clause and has agreed to hold their pricing based on cost per unit. There will be a $100 increase as we will be utilizing R.J. Recording’s equipment at the East Stage all three days and at the Lot o’ Fun Stage only two days. It was the reverse in 2004, and the East stage equipment costs are slightly higher. Staff concurs with the Tourism and Events Commission as to the use of R.J. Recording, and recommends approval of the agreement.

Authorization for Entertainment Agreement. Ms. Scalzetti said that with the backing of the Tourism and Events Commission, staff has submitted an offer to Paradise Artist for “The Temptations featuring Dennis Edwards” to perform on Thursday, June 23, 2005 as part of the Heritage Festival. This would be the one pay-to-view performance of the Festival. The cost is more than $15,000.00. Staff has submitted a bid, but has not received a response. She said the entertainment cost last year was $17,000.00.

Commissioner Urban asked about the agent. Ms. Scalzetti said it was Paradise Artist.

Commissioner Urban asked if the cost would cover hotel expenses, etc. Ms. Scalzetti said it will depend on how they respond to the offer.

Fire Department Uniforms. The Manager asked Bob Tutko, Deputy Fire Chief, to address this item.

Bob Tutko , Deputy Fire Chief, said the Fire Department has contracts with various vendors to supply uniform items such as pants, shirts, t-shirts and exercise clothing. An RFP , including a required pre-bid meeting, was distributed to various vendors for three-year contracts. Two vendors, Louis Tailors and Menswear, and Holy Cow Sports, attended the pre-bid meeting. The vendors are currently approved with the Village. Based on the performance of both vendors in previous years, the quality of the products and customer service, staff recommends acceptance of the bids as presented. Louis Tailors and Menswear is recommended for uniforms, and Holy Cow Sports is recommended for exercise clothing and t-shirts.

e. Fire Department Protective Clothing. Deputy Fire Chief Tutko said the Fire Department is required to provide personal protective clothing such as turnout coats and pants, helmets, boots, gloves, and other items. The vendors are currently approved vendors with the Village. Based on the performance of the vendors in previous years, the quality of the products and customer service, staff recommends acceptance of the bids as presented. Although the bid price supplied by Global Fire Equipment (MES) was $38.00 higher on the combined price of firefighting helmets and gloves, field testing revealed their product was more durable than lower priced items supplied by Environmental Safety Group.

Deputy Fire Chief Tutko said staff recommends approval of the bid by Environmental Safety Group for coats, trousers and suspenders at $1,175.00 per set, and approval of the bid by Global Fire Equipment (MES) for firefighting boots, gloves, helmets, rescue belts, goggles, glasses, shields, hoods, and rappel gloves.

Deputy Chief Tutko referenced another RFP for uniforms.

Commissioner McConnell asked if this RFP was the same thing as the uniforms discussed earlier.

Village Attorney Enza Petrarca said it was not.

Mayor Krajewski asked if the department uniform bid came in under budget.

Deputy Chief Tutko said it will be at or just under budget as each firefighter has a clothing allowance.

EDC Discussion. The Manager said one of the main goals of the Council is to further economic development within the Village. As part of the 2004-2005 performance objectives, the Council wanted to focus on the economic development aspect and concentrate on a position that had skills at “selling” the Village to new businesses. After developing job descriptions with input from Commissioner McConnell and EDC Chairman Michael Riordan, the job descriptions and a new departmental organizational chart was submitted on November 19, 2004.

The Manager said that after a review of the information, the Council began discussing the concept of a separate Economic Development Commission which is not operated under the auspices of the Village. He said he was asked to contact the City of Naperville to find out how their organization functions. He contacted Ms. Christine Jeffries of the Naperville Developmental Partnership to gather information. He introduced Ms. Jeffries.

Christine Jeffries , President, Naperville Development Partnership said there are as many models for economic development as there are economic development programs. She said the partnership is a fairly new structure, eight years old, which works for Naperville. By way of a slide presentation, Ms. Jeffries provided the genesis of the partnership. In the late 1980’s through mid-1990, the Economic Development Committee was part of the Chamber of Commerce. The Naperville Development Partnership was formed and incorporated as a not-for-profit 501©(3) organization in 1995. They created bylaws and assembled a Board of Directors. In 1997, the Naperville Development Partnership hired Ms. Jeffries, the first President. They operated from office space donated by the Chamber of Commerce. In 1999, the Naperville Convention & Visitors Bureau was added and the Partnership moved to new offices. The initial funding, in 1997, was $95,000 from the City of Naperville, $63,000 from other partners and in-kind services. FY 2005 funding is $150,000 from the City of Naperville, $85,000 from other partners, $450,000 from tourism, $30,000 from grants, and in-kind services.

Ms. Jeffries said the Board of Directors is comprised of 27 to 36 voting directors made up of elected directors from private industry, governmental directors, the Chamber director, the Tourism director, the Mayor of Naperville, three City Council members, the City Manager and the Chairman of the Naperville Plan Commission.

Ms. Jeffries outlined the mission and objectives of the Naperville Development Partnership. She said the purpose for the Partnership was because the development process was cumbersome; the city was experiencing warehouse development but little other office/retail development; there were no business retention and no marketing efforts; and business/development needed a voice. She said to be effective, the Partnership had to be a public/private entity; it needed to be able to effect change and not be adversarial; it needed to represent the entire community; both government and private industry needed to be stakeholders; the Board of Directors needed to be comprised of community leaders; it needed to be part independent agency and part city department; it would report to its Board of Directors; it should compliment, not compete with the Chamber of Commerce; and it should be a bridge between private industry/development and government agencies.

Accomplishments of the Partnership include working with the city to develop a streamlined permit process; creating business retention programs; marketing the community to new businesses; and serving as neutral ground for parties to discuss and negotiate issues. She described business retention efforts such as “Breakfast with the Mayor” and gave examples of early marketing successes. She said recent challenges include vacant office/industrial space and hospitality industry impact.

Commissioner McConnell thanked Ms. Jeffries for her presentation. She asked how the Partnership gets board members and about the expectations of the board members.

Ms. Jeffries said the board members set policy and direction, provide oversight and chair committees and gather resources. She said they are not expected to give hours and hours of their time. They are not required to do fundraising.

Commissioner McConnell asked how the Committee went about addressing the planning and development process. Ms. Jeffries said the Partnership was the primary change agent. They brought 20 to 50 people together at a time, some of whom were invited by the City. After the first meeting, they were willing participants. Ms. Jeffries said they would not have been able to do what they have done without the help of the City manager, Council members, City department heads, etc.

Commissioner McConnell asked how the Partnership addressed warehouse development. Ms. Jeffries said they tell the positive side of the story regarding fees and property tax rates.

Commissioner McConnell asked about the benefits and challenges of getting the Partnership running.

Ms. Jeffries said the Board of Directors manages the Naperville Development Partnership. Each director serves as a vital component. There is clarity of roles and organization. The 12-member executive committee meets monthly.

Commissioner Tully thanked Ms. Jeffries for coming to the meeting and for her presentation. He asked how long it took before the Partnership was up and running, and how long before they hit their stride.

Ms. Jeffries said merging with the Naperville Convention & Visitors Bureau was the turning point.

In response to Commissioner Tully, Ms. Jeffries described the committees of the Partnership. She said about 60 members meet monthly. She further stated that there is full disclosure as to the funding of the Partnership.

Commissioner Sandack thanked Ms. Jeffries for her presentation. He asked how they got to a structure of 32 people. Ms. Jeffries said it started with 30 people and they added government people. To be on the board, one must have a business in Naperville or live in Naperville.

Commissioner Sandack asked if Ms. Jeffries was aware of any models that were governmental and are now quasi-governmental, but not Chamber of Commerce. Ms. Jeffries said there are many variations and models based on budget issues.

Commissioner Sandack asked about the funding levels. Ms. Jeffries said the City initially offered the figure of $95,000. They receive a portion of hotel sales tax. They get involved in carrying out other initiatives such as partnering on the downtown shopping directory and other shopping corridors.

Commissioner Schnell asked about the impetus to go from the Chamber to an independent entity. Ms. Jeffries said they needed to be independent and not membership based. The Chamber does not get money from the City. The Partnership is beholden to the City.

Commissioner Schnell asked about the assimilation of the Convention & Visitors Bureau. Ms. Jeffries said prior to the assimilation the funding for the Convention & Visitors Bureau was about half of what it is now. As the City Council adds initiatives that fall into community promotion area, they have increased funding. She said tourism promotes only for hotel occupancies.

Commissioner Schnell asked who is responsible for the Rib Fest and other community events. Ms. Jeffries said it is handled by different organizations such as the Exchange Club, Jaycees, etc. She said the City has just passed a food and beverage tax and has set the money aside in a culture fund. Those groups can apply for these funds. The City donates staff to the festivals and the costs were going up. These costs have been moved into the culture fund and out of the regular tax rate which allowed the City to drop its municipal tax rate.

In response to Mayor Krajewski, Ms. Jeffries said there are ten staff members and budget of $750,000. Board members are top-level managers. The have no problem recruiting members and, in fact, have a waiting list.

The Mayor thanked Ms. Jeffries for her presentation.

Tax Abatements. The Manager asked Rita Trainor, Finance Director, to address this item.

Rita Trainor , Finance Director, said she was presenting the 2004 tax abatement ordinances. She noted that the previous speaker commented that Naperville’s tax rate is comparatively very low. Downers Grove is 25% lower than Naperville’s property tax rate.

By way of a slide presentation, Ms. Trainor outlined the tax levy rate. Staff is proposing a very modest change due to the Fire Pension levy being increased. She presented another slide breaking down the property tax levy by corporate/police, fire protection, police pension, fire pension and general obligation bond (G.O.) levies. She said staff is proposing that the general obligation bond levies totaling $863,000 not be abated. The actual proposed abatements are for the 1999 G.O. bond, the 2000 G.O. bond (downtown TIF debt); the 2001 Water G.O. bonds for the water meter system; the 2002 downtown TIF G .O. bonds; and the 1998 G.O. bonds for the Fairview Avenue debt service. The water bonds are paid for from the proceeds of the water sales revenue and the 1998 G.O. bonds are paid for from the local gas tax. The funding sources for the abatements consists of transfers from the downtown TIF fund in the amount of $898,792; the local gas tax for the Fairview Avenue G.O. bond in the amount of $270,570; the parking fund in the amount of $190,000; and the water fund in the amount of $514,678. The debt we are levying is the 2001 TIF G .O. bond and the 2003A TIF G .O. bonds for a total of $981,000. The other bonds are the Library bonds. The total amount of debt service being levied is $1,637,381.

Ms. Trainor said the general fund surplus at the end of this year is anticipated to be higher than originally budgeted. The current estimate of the general fund surplus is $2.7 million.

Mayor Krajewski asked if the estimated surplus is based on the December Treasurer’s report. Ms. Trainor said the surplus in the December Treasurer’s report is $2,615,000. She estimates an additional $100,000 by the end of the fiscal year.

Mayor Krajewski said the sales tax keeps tracking about $100,000 higher than anticipated. He said the expenses through December were just about on budget. He asked if we are anticipating being over budget on the expense side.

Deputy Village Manager Dave Van Vooren said he believes expenses will not be higher than what was budgeted. He noted that the November Treasurer’s report estimated that for December revenue would be $2,640,000. The actual amount was $2,689,000. Other revenues, outside of sales tax, are tracking below estimates. He said the revenue figure is $2.7 to $2.8 million. The expense side will be the same.

Mayor Krajewski said the budget showed a $900,000 revenue surplus.

Mr. Van Vooren said the Village legally has to abate what we anticipate the increment will be for the TIF . We have the ability to use that increment and apply it against certain bond debt requirements. This year it is the 1999 and 2000 G.O. bonds.

The Mayor said the Village is proposing to use the $190,000 from the Parking Fund toward abatements, but we do not legally have to do this. The Mayor said the Village has the money in the water fund so we must abate the 2001A water G.O. bonds. The Fairview Avenue G.O. bonds have traditionally been abated. Mr. Van Vooren said that was correct.

The Mayor said during the tax levy presentation the surplus was tracking at $1.8 million, which was $900,000 over budget. The plan is to use part of the surplus for the reserve to begin to build it up to the policy levels. Now the surplus is estimated to be $2.7 million. He said he is not in favor of raising the corporate and fire property taxes by $400,000 over last year, the amount by which the total taxes increased due to growth in the estimated assessed value. He said he is favor of abating that.

Commissioner Schnell said in December she voted to keep the tax rate the same in order to determine whether the $400,000 could be abated. She said she concurs with the Mayor that, with the surplus, the Village can and should abate the $400,000 so that the dollar amount for Corporate/ Police and Fire tax levy is the same as last year. Pensions are dictated by the State and the Council does not have much control over that.

Ms. Trainor said the reason staff did not make that recommendation is because staff is supposed to comply with the cash balance target policy. To recommend this abatement would work against that policy.

Commissioner Schnell said the Council also has an obligation to the residents. We need to build reserves, but we also need to keep the machine as lean as possible. The budget has a higher surplus than anticipated. She said staff traditionally comes in under budget which means that other monies will be put into reserves. This is an opportunity where the Council does not have to raise taxes.

Ms. Trainor said there are some fairly significant deficits in future years. Commissioner Schnell said she understood that the Council will have to deal with this as they have a policy to sunset the Home Rule Sales Tax.

The Mayor said we are incrementally building the reserves.

Commissioner Sandack said the sunset provision of the Home Rule Sales Tax is not a policy. It is written into the ordinance that the Home Rule Sales Tax goes away unless a new ordinance is passed. The Council will not need to sunset it – it does that by itself. He said he is pleased that there appears to be revenues in excess of what was anticipated; however, he noted that there are reserves that have been neglected in past years that must be replenished. He said if the Village is going to have a cash balance policy, we should try to adhere to it.

With respect to capital projects, Commissioner Sandack said the Council does not have a plan as to how to fund needed road improvements, streetscape, sidewalks, etc. One idea is to put the Home Rule Sales Tax monies in capital projects. He said the Council should do what they said they were going to do which is to move reserves in a responsible manner in order to have funds when sales tax drops, and to have a solid plan in place regarding capital improvements in order to fix roads, sidewalks and other things residents expect that have been delayed, derailed and ignored. He said our infrastructure, including Village Hall, is crumbling. He said the Council discussed the concept of truth in assessments. He suggested speaking to the Assessor about whether we are getting what we should be getting and whether the assessments make sense so we can get revenues that we are supposed to get from real estate taxes. He said there was a time not too long ago when the majority of the Village’s Corporate/Police, and fire protection were funded with property taxes. That is no longer the case. We need to fund those essential Village services or we are not doing our job.

Commissioner Zabloudil said that based on the surpluses, he is in favor of the abatements this year. However, he suggested that the Council come up with an agreement regarding investing the excess funds in our infrastructure and in capital projects. He said he would be in favor of this. He suggested setting a target for building up the reserves and getting the cash balance policy in check. He said it is important to look not in the short term, but in the long term. Funds that would be available through the lack of abatement could be earmarked for specific goals.

The Mayor asked how much money is needed in the reserve. Ms. Trainor said the target based on the FY 2005 /06 budget would be $9,761,542 using the mid-point on the cash balance target. This would be three months of reserves. She said going into this year, we were at $1,454,495 based on the audit. With a surplus of $2.788 million, it would bring the cash reserve to $4,242,911. The Mayor said the budget presented on Saturday prior to any cuts made by Council had a surplus of $2.1million. He said even with taking $400,000 out of the property taxes, we are still making good progress.

Commissioner McConnell said the abatement amount being recommended is equal to the abatement amount from last year. Ms. Trainor said she did not have those comparisons with her.

Regarding the cash reserves, Commissioner McConnell said there are reserves for daily expenses, but there are a number of other policies where we need to have reserves such as the risk fund and capital expenditure funds. She said we are not meeting those numbers. Ms. Trainor said that was correct. Commissioner McConnell said it is not just the one reserve, but rather the overall financial stability and reserve funding for the community. She said this makes her more reluctant to put any additional amount in the abatements, specifically the estimated $400,000. She said she does not think that any of the accounts currently has the targeted reserves. Even though there is a plan to get to the reserve amounts, she said we are years away from getting there. Ms. Trainor said that is correct.

Mr. Van Vooren said there are a couple of funds that meet target today such as the capital projects fund. The health insurance risk funds are close to target. The transportation fund is a long ways from being on target. He said there are some funds that are approaching the target, some are there and some are in between. He said he could provide a chart on this.

Commissioner McConnell said she believes that even with some of the funds that are at target now, the projections for future years are in the negative balance. Mr. Van Vooren said the capital projects fund is in good shape now but depending on what projects are funded, that changes dramatically.

Commissioner McConnell said that based on the discussion Saturday on the capital projects, we are only funding about half of what is needed to do the maintenance that would be prudent to be done on a routine basis. We are minus $2 million a year in what we need to do in infrastructure activities and maintain the Village as we would like it to be. We have a big deficit right now if we were doing what we believe we should be doing. This causes her to be concerned about short-term vs. long-term gains. She said based on this and assuming that the information she receives in the chart she requested is what she thinks it is, she prefers to leave the abatements as suggested by the staff.

Mayor Krajewski said he was not sure those numbers are suggested by staff, but are based on the direction given by the Council in December.

Commissioner Urban said he can only discuss some funds. There are some he cannot discuss or vote on. He said he would talk in general terms. He said he is favor of the funds if they are earmarked. He wants to see a game plan and a goal of where the money would go. He said he can put cash in a deposit slip, but banks do not take accruals from him. He wants to build up the cash reserves. He encouraged the Council to start discussion now regarding the Home Rule Sales Tax. He said he would go on record saying he was in favor of not sunsetting the Home Rule Sales Tax. He suggested taking that money and earmarking it only for the infrastructure and investing in the community through capital projects. He said this would free up money for the general fund and other funds. He said the Council needs to start addressing some of these issues today. He said the Council needs to give clear direction to the staff. With respect to the levies, the Council gave staff clear directions and the staff did a wonderful job. He complimented staff on making a user-friendly budget presentation. He said the staff saved money this year. He said that although the Village may be on target with some of the funds today, they have to look at the future as some of those funds may be lost in the next 12 to 36 months.

Commissioner Urban said that one of the residents who spoke Saturday said that eight or nine years ago the Village had approximately $27 million in reserves. He said while we do not need to be at that figure, we need to stay on track. We do not need to be at a reserve of $1 million or less. He said the Council needs to be more direct in their decision-making.

Mayor Krajewski said he agreed on Saturday to moving the Home Rule Sales Tax into the capital fund with one caveat that the general fund be appropriate on the expense side.

Commissioner Tully said in December the Council considered what the levy would be going forward. This was before the budget discussions. A levy with respect to Corporate, Police and Fire and Police and Fire pensions was presented. There were three choices: Maintain the current rate, which, due to the rising value of property within the Village, would add approximately $400,000 in property taxes to the general fund. The other proposals were to increase the rate by $.02 and the third was to raise the rate by $.04. The majority of the Council decided to keep the rate the same which resulted in an increase of approximately $400,000 in property taxes.

Commissioner Tully said an abatement is when a certain portion of the taxes levied is not collected. In December Commissioner Tully said he voted against keeping the tax rate the same because he was in favor of keeping the total dollars levied the same, resulting in a 0% increase in property taxes. Regarding the abatements, the Council can now abate, or not collect, the additional amount of property taxes of $400,000 and essentially have a property tax freeze for these particular funds. With respect to the cash reserves, Commissioner Tully said reserves are for rainy days or unusual incidents like a recession. The cash reserves were spent down during the recession, which is what they are there for. The Council and staff have worked hard to establish what a proper reserve ought to be and have a plan for building them back up. Last year we contributed to the reserve and Council had planned to contribute $900,000 to the reserve this year. Unless directed otherwise, $900,000 will go to the reserve this year. In addition, Council is discussing any additional amounts that may go into the reserve. Staff has brought to Council’s attention a number of things that could be done with the surplus such as capital projects, additional reserve issues, etc. Commissioner Tully said he was not in favor of the tax increase and is still not in favor of it. He does not think the Council should be levying additional dollars before dealing with issues on the expense side. Many people are working hard on keeping expenses down. He said he is in support of the proposed abatements discussed tonight and the additional abatement of $400,000.

Mayor Krajewski said staff has said there may be a need for money down the road for capital and other funds. He said the Council has been discussing $400,000 of the residents’ money that is clearly not needed for the upcoming budget season. It may be needed to help build the reserves or for capital improvements in future years. Another surplus is projected for next year. The Mayor said the Council can levy as much as they want in property taxes in future years. He said that instead of taking the $400,000 now and putting it in the bank, he would rather let the residents have it and if it is needed in two years, ask for it then. The Mayor said he would rather continue to work hard to make sure expenses are held tight and to continue to grow revenue through economic development. He said our cash balance is growing in the general fund. He said there is more cash in the bank than just the cash balance. He said he would support abating the $400,000.

Deputy Village Manager Van Vooren said the packets include the ordinances that deal with the abatements. He said staff will have to bring another ordinance to abate the additional monies. Abatements have to be filed by March 1. Mr. Van Vooren asked if it mattered to the Council if the $400,000 was abated from a debt service or the Village’s Corporate, Fire, and Police levy. It works out to be $.021 per $100 of EAV . It would be simpler to abate $400,000 of debt service.

Mayor Krajewski asked if this could be treated as a loan. Mr. Van Vooren said it could be set up to transfer money to the debt service as a loan. If the TIF outperforms in year 22 or 23 and there is a surplus, it could be set up to repay the general fund. The community would then win if the TIF outperformed. If it is abated off of the general property tax there is just a reduction of the levy of $.25 to $.23. This will be brought back to Council for a vote next week.

Commissioner Sandack said he would like to look at more than one ordinance and to see if the Council is going to earmark funds appropriately. He is not in favor of moving money and having it used for unspecific purposes. He said he would rather see the reserve policy be put in play, and he is more concerned about capital expenditures and things that have been delayed and derailed. He would like to look at earmarking funds in the surplus toward capital expenditures that need to be accomplished.

Commissioner Tully said he would like to see what the actual levies would be as abated for Corporate/ Police, and Fire Protection. Ms. Petrarca said the Corporate/Police and Fire Protection is one ordinance. The G.O. bonds are separate ordinances as is the library.

Ms. Trainor clarified that two potential abate ordinances will be presented next week – one for potential abatement of corporate for $400,000; and one for potential abatement of additional debt for $400,000.

Commissioner Tully expressed appreciation to the budget team for their hard work.

Future Land Use Map: Belmont Road. The Manager asked Lori Sommers, Planner, to address this item.

Lori Sommers , Planner, said this is to consider the Plan Commission’s recommendation to approve staff’s requested changes to the Village’s Future Land Use Map with respect to designating the Ellsworth Belmont Frontage to a Commercial Land Use designation from an Office-Research-Manufacturing designation. The existing Future Land Use Plan designates the subject area as Office-Research-Manufacturing. The Village is proposing that the subject parcels be designated Commercial. This proposed change is a direct result of joint committee meeting discussions by the Economic Development Commission and Plan Commission and presented to the Village Council in March 2004. The Village’s strategic goal for this area is to foster commercial and retail service land uses to replace the existing semi-industrial commercial uses with a concentrated commercial base mix-use near the commuter rail stop and future underpass. The Ellsworth Belmont frontage is defined as the western stretch of Belmont Road between the intersection of Belmont Road and Inverness Avenue north to the Belmont train station. The existing zoning in the subject area is predominately manufacturing and ranges from Office-Research-Manufacturing to light manufacturing. The area currently has businesses that are manufacturing in orientation, but it is the Village’s long term desire to have this corridor be commercial in nature with the goal of creating a transit-oriented development. Staff is requesting that the Council consider placing this amendment on the next Council agenda.

Commissioner Tully thanked the Planning staff as well as the members of the Economic Development Commission and Plan Commission for the time and effort they put into this matter. He said this is a good example of many different minds coming together to come up with a good plan for the future.

Mayor Krajewski said Ellsworth area has been a priority for a long time. He said these changes and the underpass have great potential to improve the area and to be an economic engine for the Village.

Lacey Creek Maintenance Agreement. The Manager said this agreement is for year four of the five-year maintenance and monitoring program as required by DuPage County. These efforts will help ensure that the streambank stabilization project along Lacey Creek is maturing in accordance with the original plans of the project. Work will include weed control burns. The Village currently receives a 20% matching grant to fund landscape management activities from DuPage County.

Metra Agreement. The Manager said this agreement will authorize acceptance of a lease agreement with Metra wherein the Village will provide 250 commuter parking spaces to Metra riders in exchange for a lump sum payment of $1,875,000. This is for a 40-year term, renewable for two periods of 40 years each. It would be for commuter rail parking for the hours between 6:00 a.m. and 3:00 p.m. The Village can terminate this agreement, but would have to replace the parking spaces with other parking spaces or refund Metra the costs they paid out on a pro rata basis.

Commissioner McConnell asked if the money the Village would get, $1,875,000, would be upfront for the forty years. Manager Ginex said that was correct. It would be cash in hand. She asked if the Village would continue to collect the daily $3.00 fees or whatever the negotiated fee would be. The Manager said that was correct.

Commissioner McConnell asked about multiple events occurring on the same days. The Manager said he does not believe this will be a problem.

Mayor Krajewski asked about the plans for the lump sum payment.

Deputy Village Manager Van Vooren said the Village is in the process of refunding our bonds and suggested using a portion of the cash for this, although he said the Village does not know when the check will be received. Mayor Krajewski said it could be used for the short-term note as well.

Commissioner Tully reiterated that Metra will pay $1,875,000 in a lump sum payment and in addition the Village will continue to lease out 250 daily rental spots at $3.00 per day. If the Village wants to increase the daily fee, we would have to negotiate it with Metra. Attorney Petrarca said that was correct.

Community Bank of Downers Grove: TPA Depository. The Manager said the Council has authorized a change in the Third Party Administrator for health benefits. Council directed staff to work with the local Community Bank of Downers Grove since it is owned by the same parent company as the Lake Forest Bank. Rita Trainor, Director, Financial Services, worked with Mike Busse, President of the Community Bank of Downers Grove. Mr. Busse has indicated that the bank is willing to offer the same services and terms as we had with Lake Forest Bank.

Bill Kay Nissan: Incentive Agreement. The Manager asked Deputy Village Manager Dave Van Vooren to address this matter.

Deputy Village Manager Van Vooren said staff and the EDC ’s Attraction/Retention Subcommittee have met again with representatives from Bill Kay Nissan in an effort to finalize the incentive agreement to assist in expanding the Nissan dealership in Downers Grove. They have determined that the financial need to complete a land purchase and buildings improvement is in excess of $500,000 and the inclusion of the sidewalks and landscaping brings the assistance package to $600,000.

Mr. Van Vooren said that because the Nissan dealership resides within the Ogden Avenue TIF , EDC and staff are proposing to use a combination of TIF and sales tax incentives to assist the business. The original proposal used a TIF incentive that would provide an annual payment of approximately $22,500 for a period of ten years. The balance of the financing gap would be provided by a sales tax sharing arrangement where the Village would receive the sales tax on the first $25,000,000 of sales generated from the business and would share equally the sales tax from all sales above $25,000,000 annually for a period of five years after the reopening of the dealership. The EDC Retention/Attraction Committee has proposed that the TIF incentive be increased to $35,000 for ten years. Sales tax incentive would be modified by increasing the percentage from 50/50 to a Village percentage of 75% and reducing to 25% Nissan’s percentage for a seven year period on the same base. Should Bill Kay Nissan fail to receive $250,000 in sales tax projections from the Village within the seven year period, the incentive would increase to $45,000 from $35,000 for the last three years of the TIF . Mr. Van Vooren said Mr. Eisenberg is here to answer questions.

Mayor Krajewski said he appreciated all the work put into this matter. He asked if there was a cap on the sales tax sharing arrangement. Mr. Van Vooren said there is not as it is a 75/25 percent tax sharing arrangement.

Mayor Krajewski said staff and the EDC have worked with Bill Kay for a long time. He said he would like to vote on this next week. He said he likes the plan. He said there is over $4 million in the five-year projection in the Ogden Avenue TIF fund. Staff will be working to develop plans for what this money will be used for, including sign and landscape improvements.

Commissioner Sandack thanked Bill Kay Nissan for their patience in working through this matter. He also thanked Mr. Van Vooren, Mr. Parilla and the rest of the EDC Commission members that participated. It is a good blend of using TIF flexibility with the sales tax rebate. It helps change Ogden Avenue in a productive way.

Commissioner Schnell said this is a great compromise. She extended her thanks to Mr. Van Vooren, the EDC and Bill Kay Nissan.

Commissioner McConnell offered her thanks to the team for being very creative in their negotiations. She said she looks forward to voting for this. She noted that once the Council gave clearer directions as to the parameters, the staff was able to carry them out.

Commissioner Urban agreed that once the Council gave staff the clear direction, they closed the deal. He said this is a win for Bill Kay and a win for the Village and the community.

Commissioner Tully said this took more conversation as it was the first hybrid of this sort that has come before the Council. The Council has not had a TIF /incentive in the same package before this. He said this worked out well. He said the Council would like to see the Ogden Avenue Subcommittee get back together to make recommendations as to how to use the TIF monies.

Motor Fuel Tax Ordinance Amendment. The Manager said that under the current ordinance, the filing date for local motor fuel tax payment was written to coincide with the established filing dates of the Illinois Department of Revenue of the Retailer’s Occupation Tax. Staff feels that a payment filing date based on this methodology is more difficult to track because the established due date for that type of tax is based on a 30-day filing cycle. This creates an irregular payment cycle. Staff is requesting the current ordinance be amended to require payment to be due on or about the 25th day of the month following the collection period.

The Mayor asked that someone monitor actions in Springfield that may affect our revenues.

STANDING COMMITTEE REPORTS

There were no reports

MANAGER ’S REPORT

The Manager said the budget meeting of February 5 will be rebroadcast on Downers Grove TV on Wednesday, February 9 at 6:00 p.m. for Part 1 and on Friday, February 11 at 6:00 p.m. for Part 2. Both broadcasts run approximately three hours long. The second budget meeting will be held on Saturday, February 12, 2005 at 9:00 a.m. at Public Works. It will be aired in its entirety on DGTV Channel 6 on same day tape delayed coverage that will begin at 10:30 a.m. Residents can print out the agenda by visiting our website at www.downers.us.

ATTORNEY ’S REPORT

Village Attorney Enza Petrarca said she was presenting 12 items to the Council: 1) An ordinance abating a portion of the 2004 tax levy related to Fairview Avenue debt service; 2) An ordinance abating a portion of the 2004 tax levy related to the General Obligation Bonds, Series 1999; 3) An ordinance abating a portion of the 2004 tax levy related to the General Obligation Bonds, Series 2000; 4) An ordinance abating a portion of the 2004 tax levy related to the General Obligation Water Bonds, Series 2001A; 5) An ordinance abating a portion of the 2004 tax levy related to the General Obligation Bonds, Series 2002; 6) An ordinance abating a portion of the 2004 tax levy related to the General Obligation Bonds, Series 2003; 7) An ordinance amending the Future Land Use Map for the Village of Downers Grove; 8) A resolution authorizing execution of an agreement between the Village of Downers Grove and Conservation Land Stewardship; 9) An ordinance designating Community Bank of Downers Grove as a depository for the Village of Downers Grove; 10) A resolution authorizing execution of a lease agreement between the Village of Downers Grove and Commuter Rail Division of the Regional Transportation Authority (Metra); 11) A resolution authorizing execution of a redevelopment/sales tax rebate agreement between the Village of Downers Grove and J.K. Pontiac, Inc. d/b/a Bill Kay Nissan; and 12) An ordinance amending provisions regarding motor fuel tax payments.

COUNCIL MEMBERS

Commissioner Zabloudil complimented Doug Kozlowski and the Cable TV staff for the delayed broadcast of the budget hearing. He said it is a lot of work to do this.

Commissioner Schnell suggested that an agenda of what is covered by three-hour increments be included on the rebroadcast on Cable TV. She said Cable TV has done a terrific job.

The Manager said staff runs the tape from Public Works to the Village Hall every hour.

Commissioner Tully reiterated that the budget meetings are at the Public Works Facility, 5101 Walnut at 9:00 a.m. The agenda is on the web page. He extended his appreciation to those who attended the meetings. Commissioner Tully said the February Coffee With The Council will be held on February 19 at 9:00 a.m. at the Indian Boundary YMCA , Milnes Room.

Mayor Krajewski thanked Scout Troop 57 for extending an invitation to him to speak to them. He said on Friday, he and Commissioner Tully attended a District 58 legislative gathering. Their biggest concern is unfunded mandates. He noted that HB 750 , providing for a swap between income and property taxes, could mean that tax dollars would leave DuPage County and be spread throughout the State.

ADJOURNMENT

Commissioner Tully moved to adjourn to Executive Session pursuant to Section 2©(1) of the Open Meetings Act to consider personnel. Commissioner Urban seconded.

VOTE : YEA – Commissioners Tully, Urban, Sandack, Zabloudil, McConnell, Schnell, Mayor Krajewski

Mayor Krajewski declared the motion carried and the Council convened into Executive Session at 8:53 p.m.

April K. Holden Village Clerk