Rock Island County Committee of the Whole met May 10.
Here is the minutes provided by the Committee:
1) Call to order and roll call
Committee members present: Richard Brunk, Larry Burns, Kim Callaway-Thompson, Dewayne Cremeens, Jeff Deppe, Don Johnston, Ed Langdon, Kenneth Maranda, Mia Mayberry, Drue Mielke, Luis Moreno, Pat Moreno, Rich Morthland, Scott Noyd, Cecilia O'Brien, Ron Oelke, Robert Reagan, Ginny Shelton, Rod Simmer, Mike Steffen, Kai Swanson (arrived at 5:32 p.m.), Scott Terry, Brian Vyncke, Bob Westpfahl
Committee members absent: None
2) Public Comments
There were no public comments.
3) Approval of minutes from the April 12, 2017 meeting
Motion to approve: Mia Mayberry
2nd: Cecilia O’Brien, Luis Moreno, Pat Moreno
Voice vote
Motion carried
4) Treasurer’s Report
Ms. Ewert thanked the committee for letting her have a couple of minutes. She just wanted to give the County Board some updates that the Finance Committee already heard. Ms. Ewert noted that she has told the County Board members before to pay attention to the monthly report she gives to the County Board. It’s 15 or 16 pages long. She said they will notice some negative balances at the end of April. The General Fund was at -$56,589.74. Court Security was at -$65,183.08. Child Support Maintenance was -$4,242.99. In May, she is almost positive that Liability Insurance is probably also going to be negative unless they draw on the loan.
Ms. Ewert reported that interest received for April 2017 was $8,490.00. The current year to date interest is $709,337.00. She noted that interest rates did go up. For the longest time they were stuck at 0.35% for several years.
Mr. Swanson is present.
Ms. Ewert continued that last month the, interest rates went up to 0.45%. This last month or the month before, the County Board approved the resolution for the IIT Trust with a different investment company. After checking on the website, they were getting 0.90%. Ms. Ewert contacted Blackhawk Bank and kudos to them because they agreed to meet that interest rate at 0.90%, so the money will still be staying locally which is where she prefers it. She hopes it will go up again.
Ms. Ewert reported that the General Fund has a Tax Anticipation Warrant at American Bank of $750,000; an internal Working Cash loan of $524,000; and EHB payments to the Health Insurance Fund deferred from December through April of $241,268.87. The obligations the General Fund owes are at a total of $1,515,268.87.
Hope Creek did draw an additional $500,000 on April 20. That was in part to pay back $396,850.00 to the Capital Project Fund. That was for a loan when they first built Hope Creek. It’s been owed for over 10 years. The county actually forced them to pay it, which is why they took out the additional $500,000.00. The General Fund was the recipient of that money by way of the Capital Project Fund.
Liability Insurance is still where it’s at with the $500,000 TAW unless they have to borrow before the first distribution.
Ms. Ewert noted that her office did mail out the real estate tax bills last Friday. She hopes everyone received them. If not call, they can call her office and she can get them a copy. The first distribution will be on June 22 which is exactly one day before a payroll. They kind of moved it up because they knew they might have some problems making that payroll.
On Monday, the General Fund balance was $28,068.00. This Friday, Rock Island County has a General Fund payroll. That usually runs about $750,000.00. Thankfully on Tuesday, Replacement Tax came in at $402,000; Income Tax came in at another $92,000; and Supplemental Sales tax came in at another almost $323,000. On Tuesday, she knew Rock Island County would make Friday’s payroll, so that was a relief. Ms. Ewert asked the committee to bear in mind that if the General Fund did not get that Hope Creek loan paid back of $396,850, they would have had to go out and borrow.
Ms. Ewert added that in the packets there’s an Intergovernmental Agreement where Mr. Ross had talked to the Circuit Clerk. She thanked the Circuit Clerk and Probation. The General Fund is borrowing $750,000 from them. The first thing they were planning on doing was paying off the bank loan. She doesn’t really think they’ll be able to do that. By the time Friday comes and payroll is paid out, the General Fund will probably be back where started at the beginning of the week. In two weeks, there is another $750,000 payroll and probably another $400,000 in vouchers to pay out. They’ll probably just have to hang on to that money to make sure the General Fund makes it to the first distribution, then immediately pay that loan off.
5) Report from external auditors
Ms. Palmer introduced Ms. Heidi Hopkirk, a partner with RSM, the external auditors.
Ms. Hopkirk noted that Ms. Palmer handed out a summarization of all the audit information. That’s the document she’ll be going over this evening. She noted that currently everything is in draft form. There are just a few things that are being wrapped up with some late changes. The Management Discussion and Analysis section is being finalized. That should be ready in the next couple of days. If there are any questions or changes, members can let Ms. Palmer know and they can still work those in.
Ms. Hopkirk said she has a short agenda tonight. The packet includes the Auditor’s Communication, some Summarized Financial Information, and the Auditor Letter and Compliance Report. The Auditor’s Communication is the report to the members of the County Board. Ms. Hopkirk explained that as the county’s auditors, their responsibility is to come in and audit under three sets of standards. The first two are in regard to the financial statements. The first set tells them if the financial statements are materially correct. Rock Island County received unmodified or clean opinion. That’s the best opinion one can receive. The financial statements are materially correct with no material errors that they found through the audit process.
The other set is the governmental auditing standards where they look at internal controls and checks and balances. In the current year, there was a significant deficiency in segregation of duties at Animal Control. That is a repeated finding. That department has limited staff so the Department Head has to have the ability to have access to cash and do some of the postings. Because of that ability, there is a risk with segregation of duties. With their limited staff, they’ve added as many controls as they can over the years.
The last set is the single audit. That’s where they look at federal program grants Rock Island County receives. In the current year, Rock Island County expended $6.4 million in federal monies. There were two programs this year that were looked at in detail. One of the programs was Women, Infants, and Children (WIC) program, and also the Workforce (WIA) program. The WIA audit was done by other auditors. The Tri-County Consortium has different auditors that do theirs. Both received an unmodified opinion. There were no findings or deficiencies on either program. They were very clean audits from the federal program perspective.
Ms. Palmer added that in the report, there is a separate report titled “Compliance Report,” on page six. That is where the federal grant dollars Rock Island County has expended for the year starts. They can see what Ms. Hopkirk is talking about in detail there. That’s what this report covers: all federal award dollar expenditures for the year.
Ms. Hopkirk noted that that report will include some money Rock Island County gets from the state that is federal to begin with, but the county might also receive some state grants that are 100% Illinois monies. Those won’t be in there. If anyone is expecting something to be on that list that isn’t, it’s probably coming through the state versus the federal government.
Ms. Hopkirk said that Rock Island County had very clean opinions all the way around. She congratulated Ms. Palmer and Rock Island County for that accomplishment. In the current year, the county did implement some new accounting standards, but none of them had an impact on the financial statements this year. The financial statements do include management judgements and estimates. As the auditor, they review those and look at the procedures and estimates management makes. They test the underlying information and involve specialists if necessary. They believe all those estimates were reasonable based on the information that management had at the time. No audit adjustments were proposed in the current year from RSM. The information they received from management was the same as what was put in the financial statements. That was a great accomplishment also. They did find one small error above a threshold they use, but it was not a large enough dollar amount to materially misstate the financials. They discussed it with management and they also felt it was immaterial. They call that an “uncorrected misstatement.” There’s a chart on that in the report. It was about $35,000 related to Accounts Payable. Some Accounts Payable expenditures were missing at year end. Ms. Palmer noted that that is in the report to the members of the board. The specific notation she’s talking about is on page five. Ms. Hopkirk explained that that will run through the 2017 fiscal year as expenditures.
Ms. Hopkirk continued that no significant issues were discussed with management and there were no disagreements with them in regards to accounting. They did not encounter any difficulties in performing the audit. They are not aware of any consultations with any other accountants other than those other auditors they rely on for some of Rock Island County’s component units that have special audits. Ms. Palmer explained that, specifically, she’s talking about Tri-County Consortium who has their own audit done by Wipfli; Forest Preserve uses Carpentier and has their audit done by them; and Public Building Commission has their own audit done by Carpentier as well.
Ms. Hopkirk continued that the next couple pages are financial information. The next page is the county’s net position. This is Governmental Activity and includes long term debt, outstanding bonds, and capital assets. That’s not the General Fund. That’s broken down into three categories, invested and capital assets, meta, and related debt, which is about $56.8 million as of November 30. Rock Island County has a restricted net position of $17.4 million. Those are dollars restricted by third parties and have to be used for very specific purposes. Ms. Palmer said such as grants. Ms. Hopkirk agreed. Capital Improvements is an area that is the largest restriction at $7.2 million, so half of that. In unrestricted, there is a deficit of about $15 million.
The next page is the General Fund as of November 30. For revenue components, there was an overall decrease of $237,000 from prior year, which is about 1% of revenues. The largest area is in yellow, the intergovernmental. That includes state income taxes, state grants, and federal grants. Areas where they saw decrease there were related to state income tax, which was down $257,000, and the reimbursement for Probation Officer salaries, which was down by $98,000. That makes up the difference. The rest of the revenues were pretty consistent with the prior year.
The next page is the General Fund again for expenditures. There was an overall increase of $790,000 or 3%. That’s mainly in the blue column, which is the general government column. That increase was mainly due to wages and benefits related to health insurance benefits. Also in 2016 Rock Island County had election expenses that it wouldn’t have had in the prior year.
The next page is just the General Fund’s fund balance as of November 30, 2016. It’s a moment in time. They look at that unassigned balance, which can be spent on anything. It’s presented in number of days. This year it was at 20 days. As of November 30 if no more revenues were to come in, Rock Island County would be able to pay expenditures for about 20 days. That’s a result of the decrease in the General Fund’s fund balance. Overall, the General Fund decreased about $1.5 million in fund balance in the current year. That was a direct reduction in the unassigned. Rock Island County has some restricted dollars in the General Fund, but those were pretty consistent with the year before at about $500,000.
Ms. Hopkirk thanked the committee for their time. She thanked Ms. Palmer and Ms. VanDaele in the Auditor’s Office and all the other individuals throughout the county, such as the Treasurer’s Office and lots of other departments, which answered questions and provided information. They wouldn’t be able to complete the audit without all their assistance and help.
Mr. Swanson thanked Ms. Hopkirk for her report. He asked, in her experience, what a healthier days balance is and what would a range to shoot for would be. Ms. Hopkirk said that’s always a question she gets. First, it needs to be individually looked at as far as revenue streams. The benchmark they commonly see is 30-60 days. As a government, Rock Island County doesn’t want to be holding too many dollars too long. Rock Island County also has revenue streams like property taxes with big payments at certain times. Depending on the year end, those could fluctuate. A common range they do see, even as policies within governmental entities, is 30-60 days.
6) Condition of Funds report
Ms. Palmer noted that she would start with the Trial Balances report. The committee has those in paper form next to their desks and also would have received them by email earlier this afternoon. On the Trial Balances, they’re talking budget. She breaks down everything that hits the budget on these reports and that comes out to where, as of April 30, there should have been at least 58% left to spend. If not, sometimes there are one- time expenditures or large purchases that go into effect at the beginning of year; or it’s potentially an over budget spending. She’s happy to say only Zoning, which was barely due to some conference fees, travel, and membership fees that were due, is already is a little over budget. FICA is slightly over budget at this time. She thinks that’s because of step increases and things. Ms. Palmer corrected herself and said that’s IMRF. It’s also due to the increase in the percentage that came in from IMRF, which was higher than they knew about at budget time last year. That’s not concerning to her just yet. It’s 2.5% over budget. Rock Island County did increase those property taxes last year, so she thinks it has enough in reserves and that should not be problem on the cash balance page.
Ms. Palmer turned to the Fund Balance page. She noted that most of the ones in the center column, which is the current fund balance as of April 30, that are in the negative are all the ones she has been talking about month after month. She doesn’t really have anything new to add as far as those go.
Ms. Palmer directed the committee’s attention to the first column, which is the fund balance as of November 30, 2016. Those are in alignment with the audit now that they have produced the draft and are on their way to finalizing it in the next couple of days. She did use those numbers. The General Fund, as Ms. Hopkirk just mentioned, is down for FY16 as audited by $1,533,500. That’s how much the General Fund sunk from the $3.6 million last year to now this $2,100,000 rounded.
Ms. Palmer asked the committee to also to note that the Hope Creek fund balance for FY16 went down $541,000.
Ms. Palmer reported, as she just touched on, that IMRF and FICA both went up about $1,200,000 each.
Ms. Palmer explained that Animal Control was only down $10,000 and they did not use any General Fund budgeted amounts that they needed going in. Their cash stayed enough to where they could get by without bringing in additional funds from the General Fund. It’s just the fund balance that is hurting because they have all those loans from the General Fund from years ago.
Ms. Palmer reported that the Health Department went up $111,000. That’s really good news.
Ms. Palmer explained that Child Support is down $10,000. That was loaned from the 153 Fund, Court Document Storage, instead of coming from the General Fund because the General Fund has no funds.
Ms. Palmer reported that for 2016, the Employee Health Benefits Fund went up $61,000. That’s also a good thing.
Ms. O’Brien noted that Ms. Palmer mentioned that the Health Department was up $111,000. She doesn’t know if Ms. Palmer knows the answer to this question, but if they are looking to eliminate Family Planning, that’s about the amount they’re short. She asked if that affects that decision and helps with that problem if funds are up for whatever reason. Ms. Palmer said she can’t answer that specifically. Ms. O’Brien apologized for putting her on the spot. Ms. Palmer said her understanding is that the federal funds are not coming in to fund that program. Expenses will go down proportionately, so there should be no effect on fund balance for FY17. Ms. O’Brien asked if the amount were up was in this past year. Ms. Palmer said yes. It was FY16 as a whole. Ms. O’Brien said she answered her own question, then.
Mr. Maranda added that the fund decreased 64%. Mr. Langdon confirmed. Ms. O’Brien said she’s still learning and thanked everyone for their patience. Mr. Maranda explained that only $29,000 is left in that. They operate on grants. It’s a funny issue up there. He asked Mr. Langdon if that’s correct. Mr. Langdon confirmed. Mr. Maranda noted that Mr. Langdon is their main man on the Health Department Board.
Ms. Palmer noted that another thing she wanted mention on the fund balance page is that for just the General Fund revenue, compared to last year at the same time as of November 30, General Fund revenue is up $61,000. General Fund expenditures are actually down $8,000, which is good.
As far as she can expect in looking at the numbers today and looking at where the General Fund is cash-wise, she fully predicts that since 2016 went into the hole fund balance-wise $1.5 million, she’s saying that 2017 will be pretty spot on to be $1.5 million in the hole again. Today if the General Fund is already at a point where it’s borrowing over $1.5 million to get it through until property tax distribution, that would tell her it’ll be borrowing $3 million next year at this time. That’s really, really tough to take.
Ms. Palmer noted that Fund 128, the Court Security Fund, did have a budgeted $200,000 of General Fund support. Court Security is steadily going into the hole. Right now they’re $87,717 as of April 30. They did reduce the General Fund support amount, however, because the Sheriff is doing some adjustments in his office. Instead of employing an open position Bailiff that was budgeted for, he moved it to the General Fund and is hiring a part-time person in Administration for the exact same dollar amount. Ms. Palmer reduced and transferred that from the General Fund support that would go to Court Security. It’s no longer needed. That’s now in the General Fund. It’s a wash. The money that would be spent already in one area just moved over to another.
Ms. Palmer moved on to her Cash Balance report. She noted that a lot of cash balance items that she usually talks about, Ms. Ewert has touched on such as loans, the loans affect cash balances; the General Fund getting paid back from Hope Creek; the TAWs outstanding that affect the cash balance only; the Working Cash loan to the General Fund, which is in the top row. The report also shows the funds that were in the negative cash-wise as of April 30. Ms. Palmer noted that Ms. Ewert said General Fund cash was in the hole $56,000. That’s in the first row, first column of Ms. Palmer’s report. She takes those numbers and makes sure the Treasurer’s Office and her office are in alignment at all times. A lot of this is reiteration, so she doesn’t think she needs to go through fund by fund unless someone has specific questions or concerns. She wants to monitor fund balances more than cash. Those have to do with budgetary items and cuts that the county may be experiencing in the near future.
7) Staff reports
There were no additional staff reports.
8) Update and discussion on status of Rock Island County Courthouse
Mr. Maranda recognized Mr. Fisher, Chair of the Public Building Commission.
Mr. Fisher explained that where things are at in the expansion is the parking lots are done, the cameras are in, lights are on, all the borings are done in the parking lot to the jail. The boring is done from this building. Fiber optics and AT&T lines are all the way across to Justice Center were done timely.
They have started Phase I, which is property demolition, locating utilities, sewer, and water. They are going to start some elevator work. Basically it’s all groundwork. They are getting ready for the (inaudible) that the Justice Center sits on and all the drilling for that. That’s all in Phase I.
For Phase II, they had a pre-bid meeting with the contractors this week. Those bids go out in two weeks and are due back on the 23rd. That’s the bulk of the work. It’s trade work, such as electrical, plumbing, walls, concrete work, and glazing glass. Also in June is the final phase which they call the soft work which will be furniture, carpeting, audio/visual work, shelving for the law library, and judges’ chambers, courtrooms, all that type of work. It’s a lot of carpentry work. That’s all due back in June. All the workers will be set in place this summer. Gilbane says by this winter, things should be watertight. There should be doors and windows and they’ll be moving to the work inside. They foresee completion in October of next year with the final closing in November.
Mr. Fisher reported that Phase I came back around $400,000 under bid. They’re hoping to do that kind of bidding in the future. That’s about where they stand in construction.
Ms. O’Brien asked if the County Board gets to see a schematic design and if the architecture firm is going to give them pictures and show what the plan is, or if that was last year when she wasn’t on the Board. Mr. Maranda said that all started last year. Ms. O’Brien asked if they can see that and if it’s online somewhere. Mr. Fisher said he can make the outside available. They’re still working on the interior design. As soon as that’s available, the County Board will see that. Ms. O’Brien said she just wants to get a concept of what is actually being added on. She has a general idea, but would like to know more.
Mr. Fisher continued that right now they’ve completed redoing the entry to the Justice Center. When it’s all completed and it’s open next year, the present Justice Center will have the same entry as the expansion. That cuts down on security and puts it all in one place. They have to get people in there during construction and that has been a task.
Mr. Johnston noted that in February 2016 when the County Board passed the design and $25 million with $3 million in reserve in case it was needed, the plan here included all the square footage and four floors. His understanding is that has been diminished somewhat since. Mr. Fisher confirmed. They are taking the fourth floor out to stay within the $28 million. Mr. Johnston asked how much in the design from the original architect from DLR will be missing and if they can see a copy of the plans that exist now. They have the ones from February 2016. Mr. Fisher said as soon as that’s available to him, he will make it available to the County Board. The big difference between a third and a fourth floor is two courtrooms. Mr. Johnston noted that it was originally six courtrooms and asked if it’s now down to four. Mr. Fisher confirmed.
9) Finance & Personnel Committee report
Mr. Brunk reported that the Finance and Personnel Committee met on Tuesday May 9. The committee considered a number of delinquent tax resolutions in Andalusia, Rock Island, South Moline, and Bowling townships.
The committee considered the board member per diem and mileage report. They also considered appropriation resolutions for funds. There was only one new money resolution related to what the County Board approved for the State’s Attorney’s Office last month. All the rest were related to seizure money, grants, and the reduction Ms. Palmer mentioned in the Court Security Fund. The committee also considered transfers of appropriations in the General Fund, Bridge Fund, Motor Fuel Fund, and Highway Fund. They considered claims at $1,503,373.26 and TDs at $2,294,838.24.
The committee discussed the concept of consolidated Recorder’s and County Clerk’s offices. After several questions and answers and a great deal of discussion, it was determined that it simply wouldn’t work well for the county and no action was taken for lack of any motion.
The committee considered a resolution for an intergovernmental loan agreement with the Chief Judge, the Circuit Clerk, and Probation Services. The resolution allows the General Fund to borrow $750,000 total from those departments in order to avoid having to go out for a TAW, thus saving on interest costs.
The committee reviewed bids from Public Works for contract mowing for special service areas. Per recommendation of the Hillsdale SSA, the committee did not accept the low bid for Hillsdale due to it being too expensive. The committee recommended approval of the low bid for Zuma Canoe Creek pending acceptance from the Zuma Canoe Creek SSA.
The committee also will be recommending approval of the County Engineer Salary Resolution which allows the county to take its half of the County Engineer’s salary from Motor Fuel Tax funds.
The committee considered changes to the Employee Benefits Policy, number 500.1. One change rewords a section to keep it in line with existing county practices. The other change reduces the amount of time a new employee must wait to be eligible for insurance from 90 days to 60 days in line with industry standards and prevents new employees from incurring penalties for being uninsured.
10) Governance, Health, and Administration Committee report
Ms. Mayberry reported that the GHA Committee heard reports from Ms. Kinney and Ms. Ludwig. Ms. Kinney informed the committee that the April ballot has been certified and voter turnout was 16.9%. Ms. Ludwig informed the committee that the Family Planning program at the Health Department has been closed and will end at the conclusion of the grant year on June 30. All employees except the Nurse Midwife will be placed in open positions elsewhere in the Health Department.
The committee considered the revised Liquor Control Resolution and directed the Chairman to update it with language that allows minors to be in a bar after 10:00 p.m. for food service and if they are accompanied by parent or guardian. The committee also directed the Chairman to make an exception to the rules for minors for employees of the establishment.
The committee considered the FY17 Consolidated Vehicle Procurement application, which is part of the DOAP grant the County Board passed last month. The committee recommended approval of the CVP application.
The committee voted to send a letter to legislators on behalf of the GHA committee opposing the amendment to SB-2199, which proposes decreasing the LGDF fund by 25%.
11) Public Works & Facilities Committee report
Mr. Burns reported that Public Works and Facilities met on Monday May 8. The committee considered ZBA cases as follows and recommended approval of all: SU-17- 203, Jason Hoehn, density increase in Canoe Creek Township and SU-17-204, Sun RV Sunset Lakes, private recreational facility, in Canoe Creek Township.
The committee considered a program funding agreement between Rock Island County and the Illinois Housing Development Authority and recommended approval. The committee considered a resolution accepting a grant from the IHDA’s Abandoned Residential Property Municipal Relief Program and recommended approval.
The committee reviewed bids received on Friday May 5 for contract mowing and recommended approval of the low bid of $8,845 from Legacy Corp for the Zuma Canoe Creek SSA.
The committee considered the annual County Engineer Salary Resolution and forwarded it to the Finance and Personnel committee.
12) Review transfers of appropriations, appropriation resolutions for funds, claims, and TDs
Mr. Maranda noted that the transfers and everything are in the baskets for review. TDs are there too.
13) Approval of County Board agenda
Ms. Covella noted that she forgot to print the agenda and would email it to all members.
Motion to approve: Bob Westpfahl
2nd: Luis Moreno
Voice vote
Motion carried
14) The Committee of the Whole may vote to enter into Closed Session for the following:
• 5 ILCS 120/2(c) (1) – The appointment, employment, compensation, discipline, performance, or dismissal of specific employees of the public body or legal counsel for the public body, including hearing testimony on a complaint lodged against an employee of the public body or against legal counsel for the public body to determine its validity.
• 5 ILCS 120/2(c) (2) – Collective negotiating matters between the public body and its employees or their representatives, or deliberations concerning salary schedules for one or more classes of employees.
• 5 ILCS 120/2(c) (11) – Litigation, when an action against, affecting or on behalf of the particular public body has been filed and is pending before a court or administrative tribunal, or when the public body finds that an action is probably or imminent, in which case the basis for the finding shall be recorded and entered into the minutes of the closed meeting.
The committee did not enter into closed session.
15) Adjourn
Meeting adjourned at 6:13 p.m.
Future scheduled meetings on June 14, July 12, August 9, and September 13
http://www.rockislandcounty.org/CountyBoard.aspx?id=40517
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