Loading...
11/19/2012COMMITTEE OF THE WHOLE – Minutes of Meeting November 19, 2012 The Village Board met as a Committee of the Whole in the Community Conference Room of the Village Hall at 6:30 p.m. on Monday, November 19, 2012. In attendance were: PRESENT: Village Board Staff Harriet Rosenthal, Mayor Kent Street, Village Manager Robert Benton, Trustee Jenny Maltas, Assistant to the Village Manager Thomas Jester, Trustee Eric Burk, Acting Finance Director Mary Oppenheim, Trustee John Sliozis, Police Chief William Seiden, Trustee Barbara Little, Director of PW and Engineering Barbara Struthers, Trustee Andrew Lichterman, Management Analyst ABSENT: Alan Farkas, Trustee ALSO PRESENT Daniel Berg, Sikich, LLP Public Comment There was no one present for public comment. Fiscal Year 2011/12 Audit Review Acting Finance Director Eric Burk reported the fiscal year 2011/12 audit has been completed and received a desirable “Unqualified Opinion” from Sikich, LLP. Mr. Burk noted there were two major changes included in this years audit report: (1) Fund balance categories have been expanded and there are now 5 categories describing the different levels of spending restrictions; and (2) the Deerfield Public Library is no longer a component unit included in the Village’s audit report and the Library will report finances separately. Mr. Burk introduced Daniel Berg, Partner with Sikich, LLP and asked him to report on the highlights from this year’s Comprehensive Annual Financial Report. Mr. Berg thanked the Village Board for utilizing the services of Sikich, LLP and restated that the Village’s audit received an “Unqualified Opinion.” He noted this is the best rating the Village can receive. Mr. Berg complimented staff on their preparations and for providing the Sikich audit team with all the necessary documents. Mr. Berg noted he anticipates this year’s report will once again receive the Government Finance Officer Association’s Certificate for Excellence. Mr. Berg also reiterated the Government Accounting Standards Board has implemented new standards that no longer requires the Library to be included in the Village’s audit report and also establishes new fund balance categories that help educate users that not all unspent fund balances are actually available to be spent. C.O.W; November 19, 2012 Mr. Berg highlighted changes in this year’s report:  Overall net assets increased in spite of WRF construction.  The General Fund increased by $2.2 million.  The Library bond is included in the report (since the Village issued the bond on the Library’s behalf).  The water and sewer funds both had net losses and need to be monitored regularly. o Manager Street noted both water and sewer rate increases were included in this year’s budget but are not reflected in the current audit report.  The Police Pension Fund increased net assets by over $3 million, which is a 10% increase. Mr. Berg noted it is excellent and very unique that the Fund is 80% funded, while most other municipalities have Police Pension Funds funded at the 50-60% range.  The Illinois Municipal Retirement Fund (IMRF) is 61% funded. Mr. Berg noted the Village cannot control the funding liability of this account and overall the IMRF increased 3% year-over-year. Trustee Jester questioned whether the auditors perform random checks on the Village’s financial reporting. Mr. Berg noted the audit team performs random checks on revenues and expenditures that did not take place during the previous year, and more importantly they ask for extensive supporting materials from staff to confirm reporting. Trustee Jester noted the amount of accrued vacation time for staff is very troubling. He requested that the Village Manager review the situation and advise the Board how the Village got to this level of vacation accrual and recommend a solution. Trustee Oppenheim asked about efforts for the Village to automate inventory and noted implementing time-clocks is one system that has been discussed in the past. Mr. Berg noted the Village will need to conduct a cost-benefit analyst to determine if there is an opportunity for savings to be realized. Manager Street noted there are more opportunities to automate systems today at lower costs than previously existed. Trustee Struthers cautioned she does not want staff to feel that they are not trusted by implementing system such as automated time-clocks. Trustee Oppenheim noted it is not a trust issue but rather a matter of efficiency. Manager Street noted the system would better protect both the Village and the employees. Trustee Struthers asked if the Police Department is voiding tickets and recommended against such a practice. Chief Sliozis reported the Department rarely voids tickets and when it does take place it is primarily related to parking tickets. He noted, after valid proof is shown to void a ticket, those tickets are documented and signed-off on by at least two officers, one of which is the Chief or Deputy Chief of Police. He stated the Department can conduct checks of voided tickets more often to ensure the proper documentation is being included. Mayor Rosenthal asked Mr. Berg about the Discreetly Reported Component Unit included in the audit report. Mr. Berg noted that section use to be where the Library’s report was included and it should be removed from the report. C.O.W; November 19, 2012 Trustee Struthers noted the report shows $4 million is owed to the Village from other governments and asked what those other governments are. Mr. Berg reported that it is approximately 4 months of sales tax and 3 months of income tax payments that the Village is owed by the State of Illinois. Trustee Struthers inquired about the deferred property taxes listed in the report. Mr. Berg noted those are County property taxes that are billed but not recognized until the next fiscal year. Trustee Struthers asked about the overlapping debt schedule. Mr. Berg noted this illustrates to the user (homeowner, business owner, taxpayer) what they will ultimately be liable to pay for debt of all applicable taxing bodies. Mayor Rosenthal stated the Village is well aware of the misconduct that took place in the Finance Department at Dixon, Illinois and asked Mr. Berg how the Board can be assured it is not happening here. Mr. Berg noted Dixon operated on the Commission form of government, rather that than Council-Manager form, and the Treasurer in Dixon was not professionally trained. Further, he noted that Deerfield has internal controls in place, segregates duties, has lots of oversight, and independent auditors confirm the State revenues that are reported by the Village, none of which was the case in Dixon. Mr. Berg noted it would be nearly impossible for any material amount of funds to be misappropriated in the Village without being caught by staff or the audit team. Mayor Rosenthal stated that is very reassuring. The Village Board thanked Mr. Berg and the Sikich audit team for their comprehensive report. Other Items for Discussion Mayor Rosenthal suggested reviewing next year’s budget line-by-line. Manager Street noted this is something staff is prepared to do, as they already conduct this review internally prior to presentation to the Board. The Village Board concurred with Mayor Rosenthal. Adjournment Trustee Benton made a motion to adjourn. The motion was seconded by Trustee Oppenheim. The meeting adjourned at 7:15 p.m. Respectfully Submitted, Andrew S. Lichterman Management Analyst