Rock Island Today

Rock Island City Council met December 4.

Here is the minutes provided by the Council:

1.Call to Order

Mayor Thoms called the meeting to order at 6:45 p.m.

2.Roll Call

Present: Mayor Mike Thoms, Alderman Dave Geenen, Alderman Ivory D. Clark, Alderman Virgil J. Mayberry, Alderman James Spurgetis, and Alderman Dylan Parker

Alderman Joshua Schipp arrived at 6:49 p.m.

Absent: Alderman Stephen L. Tollenaer

Staff: City Manager Randy Tweet, City Attorney Dave Morrison, City Clerk Judith Gilbert, and other City staff

3. Pledge of Allegiance

Mayor Thoms led in the saying of the Pledge of Allegiance.

4. Moment of Silence

Mayor Thoms asked for a moment of silence.

Mayor Thoms asked for prayers for City of Moline Mayor Stephanie Acri who was in a car accident today.

5. Minutes of the November 20, 2017 meeting.

Motion:

Alderman Geenen moved to approve the Minutes as printed; Alderman Clark seconded.

Vote:

Motion passed on a 5-0-2 voice vote. Aye: Geenen, Clark, Mayberry, Spurgetis, and Parker. Nay: None. Absent: Tollenaer and Schipp

6. Minutes of the Executive Session of November 20, 2017.

Motion:

Alderman Spurgetis moved to approve the Executive Session minutes; Alderman Parker seconded.

Vote:

Motion passed on a 5-0-2 voice vote. Aye: Geenen, Clark, Mayberry, Spurgetis, and Parker. Nay: None. Absent: Tollenaer and Schipp

7. Update Rock Island by Mayor Thoms

Holiday Lighting Contest - The City of Rock Island’s Beautification Commission is sponsoring the 32nd Annual Holiday Lighting Contest. To nominate a residential or commercial light display, send the name and address of the display via e-mail to DOUGLASS.KATHRYN@RIGOV.ORG or call (309) 732-2905 by 5:00 pm on Wednesday, December 6, 2017. Judging will take place on the evening of December 11, when all displays should be illuminated by 5:30 p.m. Winners of the 2015 and 2016 Holiday Lighting Contest are not eligible.

College District Christmas Walk - Join the annual family friendly Christmas walk through the College Hill Districts antique shops on Thursday, December 7, 2017 from 5:00 p.m. to 8:00 p.m. Santa will be there to greet the children of all ages, Rock Island High School carolers will be traveling the streets and singing songs of the season, the shops will be loaded with Christmas cheer and decorations galore, AND prizes will be had for passport winners.

Gallery Hop - Gallery Hop in Downtown Rock Island District is the foremost winter-time event of the Rock Island Arts & Entertainment District. Local and regional artists will have their artwork on display, Friday, December 8, 2017 from 6:00 p.m. to 10:00 p.m. The “Hop Stops” stretch all the way from 16th Street to 25th Street and from 1st Avenue to 5th Avenue and a map will guide “Hoppers” to each venue. These locations are not limited to art galleries; artists will exhibit in coffee shops, restaurants, retail shops, and entertainment venues. This is a perfect event to take care of some holiday shopping, all while supporting local businesses and artists.

8. Presentation by Erik Reader, Development Association of Rock Island, regarding the Hard Hat Awards.

Erik Reader, on behalf of the Development Association of Rock Island, distributed and collected ballots for the Mayor and City Council Award for the 29th annual Hard Hat awards. The Mayor and Council Award is for the most strategic new investment in 2017. The Hard Hat Awards are being held on Wednesday, December 6 at Skellington Manor. Mr. Reader said it is a celebration of business, real estate, and economic development in Rock Island. He invited Council members to attend the event.

9. Proclamation endorsing the efforts of the Illinois Bicentennial.

Mayor Thoms said at noon today, a special Illinois Bicentennial flag was raised at City Hall for the 199th birthday of Illinois. Fifth graders from the Rock Island Math and Science Academy were in attendance. He said there would be numerous events going on throughout the coming year celebrating the bicentennial. Mayor Thoms read the proclamation.

10. Mayor Thoms closed the regular meeting and opened the Truth in Taxation Public Hearing at discussion on a proposed property tax increase for the City of Rock Island for 2017.

Mayor Thoms closed the regular meeting and opened the Truth in Taxation Public Hearing at 6:55 p.m.

Finance Director Stephanie Masson stated that for the purposes of explaining the reasons for the proposed tax levy increase, she would be reviewing some of the Budget Overview presentation that was made at the November 20 Council meeting. The Illinois Compiled Statutes provide the framework for the tax levy and extension process. Whenever there is a proposed increase greater than 5%, a public hearing must be held to hear public comment on the increase. Ms. Masson said she will review the goals of this year's budget process and review the total revenues and expenditures. The focus of her presentation will be on the General Fund and the Parks Department and the Library funds as they receive the funds from the property taxes.

The goals of the budget process were to have a balanced budget, keep financial impacts to a minimum for residents and businesses while continuing to provide quality services, and be fiscally responsible by preserving the City's current financial position while setting the stage for future financial health.

Ms. Masson said the CY 2018 expenditures are $117.1 million which is less than last year's expenditures of $133 million. This is for nine departments and over 44 funds. The General Fund is the largest at $35.1 million expenditures. Utility funds (water, sewer, stormwater, and refuse) are second with $29.6 million in expenditures. By category, personnel is the largest portion of the budget at $47.7 million or 41% of the expenditures. Last year's expenditures were $48.2 million. Ms. Masson noted that there are six union contracts with negotiated wage increases and police and fire pension contributions have grown. The offset is the result of elimination of positions, planned delay in hiring, continued restructuring that has taken place (Parks and Finance Departments, for example), lowering the original amount planned for cost of living increases for those employees not in a union, and restructuring of employer health insurance expense utilizing reserves of that fund.

Total revenues are just less than $116 million with charges for services making up the largest portion at $24.8 million or 21% of the revenues. Debt proceeds reflect loan proceeds from the Illinois Environmental Protection Agency for the Water Filtration Facility project. Property taxes account for $17.9 million and include the increment from the seven active TIF districts. Revenues are less than expenditures so the difference between revenues and expenditures is funded by current reserves. It is planned to use current fund balance for some of the bond payments and a purposeful reduction of the health insurance fund balance. Department directors were given guidelines to cut 5% of their budgets.

Ms. Masson moved on to the General Fund Budget. The last few years, balancing the general fund has been a challenge especially with flat revenues. At the beginning of this budget season, one of the guidelines requested of department directors was to reduce overall budgeted expenditures by 5% over the current General Fund budget. This percentage was derived from projected general fund revenues and naturally increasing costs – mostly those associated with personnel costs since so many of the employees are part of bargaining units. Knowing what the actuarially determined police and fire pension costs would be, a 5% reduction is what would be needed to present a balanced general fund budget. Departments struggled with this request and concerns were raised about impacting service.

With regard to state and local taxes, the City's budget is impacted by state decisions: an overpayment of $82,000 in sales tax which had to be repaid in full with one payment; an income tax cut of 10% that began in July with the state's fiscal year; a sales tax administrative fee of 2% which will cost the City $45,000; and the Personal Property Replacement Tax will be reduced by 23%. The total financial impact to the City is $1.7 million.

Ms. Masson explained that police and fire pension costs have risen $2.5 million over seven years. These costs are calculated by an actuary using various assumptions and the City funds these costs through the property tax levy. During this time period, the solution for funding was to reduce the general fund’s portion of the tax levy while keeping the overall tax levy rate even. While the City stands by its pension obligations, the budgetary impact of these costs continues. Another challenge is that over 70% of operating costs relate to personnel expenses including collective bargaining contracts with negotiated pay increases covering the majority of staff. Health care costs continue to increase at a rate faster than the Consumer Price Index (inflation). Personnel costs in the General Fund alone increase over $1 million annually.

Ms. Masson said proposed budget solutions incorporated three areas: expenditure reductions (including a reduction of five vacant positions (two patrol officers), a delay in hiring of positions, restructuring of positions in several departments, a reduction in the planned cost of living increase for non-union positions, a delay in making vehicle purchases, and reduced street maintenance), revenue increases including ambulance fees and the gas tax which will be discussed at next week's Council meeting, and the use of reserves.

General Fund revenues are $35.2 million, up $961,000 or 2.8% from the CY 2017 Budget and General Fund expenditures are $35.1 million and will have a 0.7% increase of $243,000. The Police Department makes up 40% of the total at $14.2 million, the Fire Department at 28% with $9.8 million, and the Public Works Department at 15% of the budget with $5.3 million. These three departments account for 83% of the General Fund budget. By category, personnel accounts for 76% of the General Fund expenditures with services at 18%. Ms. Masson said personnel costs are more than just salaries (57% of the cost); pension costs make up 29.2% of personnel costs including police and fire pensions, social security, IMRF, and Medicare. Health insurance costs are another large portion of personnel costs. Alderman Geenen asked for the total number of employees. Ms. Masson replied there are 431 employees total. Departments are having to do more with less.

Ms. Masson explained that the Parks and Recreation Department and the Library are both part of the tax levy. Property taxes make up 33% of the Park and Recreation Fund revenues. The Library fund is a governmental fund with property taxes making up 65% of their budget. The Library has limited user funds. The Library's $2.5 million in revenues almost covers the $2.6 million in expenditures.

The proposed property tax levy of $12,384,168 is an increase of $1.1 million compared to last year's tax levy. Police and Fire pensions account for 54% of the tax levy. Public Benefits refers to debt service. This portion of the levy is being lowered to offset the increase in pension costs. Ms. Masson explained that the tentative EAV or valuation of property in the City reflects a 0.73% increase. The final valuation can be different due to property tax appeals. The City EAV history is trending upward. The tax levy includes funds for the General Fund, Police and Fire pensions, the Library, Parks, and Public Benefit. The Library and Parks portion of the tax levy has been bee relatively flat for several years with very small increases the past two years. The portion of the tax levy for the Police and Fire pensions continues to increase.

Ms. Masson reviewed the property tax bill and overlapping tax districts. The City accounts for only 23.3% of a homeowner's property tax bill. Only this portion reflects the City's increased tax levy. The school district has the largest portion of the tax bill at 52.4%. Ms. Masson explained the proposed increase of the tax rate at 2.6022 for a homeowner of a $100,000 home will be a $58 increase or $4.87 per month.

Ms. Masson concluded by saying a mix of solutions was utilized to cover the budget deficit including revenue increases, expenditure reductions including elimination of staff, deferrals in hiring and purchasing, and the one-time use of reserves. This will enable the City to maintain a 90 day reserve fund balance and hopefully preserve the City's bond rating.

Ms. Masson said the City's budget documents are on the City website.

Scott Kochuyt, a resident of Rock Island, is concerned that most of the retail development is going to Moline and Davenport and that people are not giving Rock Island due consideration when purchasing a home or starting a business. He loves living in Rock Island and Rock Island has a lot to offer. He did not see a lot of activity with the previous administration. He would like to hear more about the priorities for retail development. Mr. Kochuyt said he appreciates what the Council is doing and their service.

William Nunn, a resident of Rock Island, said when he hears property tax increase, he starts looking to move. He asked if the property tax increase is necessary for the budget or if the other options can satisfy the budget deficit. He said the City can't keep relying on property taxes to fix things.

Alderman Parker said as alderman of the 5th Ward which includes most of the downtown, much of the development efforts don't make the headlines. The City signed a redevelopment agreement with Saratoga Capital for a $10 million investment in a downtown building (Riverview Lofts/Best Building). Alderman Parker is working to get the downtown on the National Register of Historic Places which could provide tax credits to developers. Development is a long process and the City is trying to create an environment for business to grow and prosper in Rock Island.

Alderman Schipp said he ran in 2015 to change some of the things the previous administration was doing. There is a new team in place at the City and they are looking at things from a macro perspective. In the past, there was a fear of raising taxes. Alderman Schipp said Rock Island is competing against deeply entrenched retail corridors in the region. They hope to get a private developer for the 11th Street parcel. With the Saratoga deal, the City made sure no payouts will be made until the work is done. Casey's will be bringing a diesel hub to Southwest Rock Island; there are two small grocers now in downtown. The greatest challenge is combatting the perception that people don't want to move here or have a business here. He finds that offensive to the residents and businesses who have been here for years and who are successful. Alderman Schipp recently bought a home in Rock Island. The City has robust Parks and Public Works departments. While the population has declined since the 1960s, the rate is slowing. The City is hopeful that new homes can be built in southwest Rock Island. He repeated that the City is looking at the full picture and Rock Island is just as good as Moline or Davenport. Mr. Kochuyt said he was encouraged by Alderman Schipp's comments.

Alderman Geenen said the state implements mandates to the cities; pension costs are squeezing the budget and will continue to grow. Alderman Clark said other municipalities are feeling the pension cost squeeze too.

Alderman Mayberry asked Community and Economic Development Director Chandler Poole to speak about projects that are happening. Mr. Poole said the City has a prime 23 acre parcel on 11th Street. The site had never been marketed. At a recent conference, they talked to the former Walmart representative who said the site was approved by corporate. Walmart made the decision to cut projects in 180 cities; Rock Island was one of them. CED staff also spoke with numerous developers about the 11th Street site and the response was very encouraging. CED is working with a grocery consultant who surveyed the competition and is preparing a report helping the City to target the most appropriate grocery chain for the site. CED staff has also evaluated every commercial district in town and prepared an inventory of land and buildings which they will be aggressively marketing. CED is working with Quad Cities First for development in Rock Island; CED has also reached out to the state. Mr. Poole said the Saratoga deal is based on performance; there must be a certificate of occupancy for the developer to receive the incentive dollars. Alderman Mayberry asked about the Casey's deal. Mr. Poole said it is being reviewed by Casey's corporate, but Casey's is willing to build a bigger facility to make it more of a corporate filling station. They are doing their final tests on the site.

Alderman Parker asked when the grocery study would be completed. Mr. Poole said he expects it within the next week or two. Mayor Thoms said he knows of three new restaurants opening in Rock Island, two under the same name at different locations. He also stated it is important to compare apples to apples, for example comparing Illinois to Iowa. It's not just about property taxes. In Iowa, there are higher license plate fees, pensions are taxed, and income tax is higher.

Mayor Thoms closed the public hearing and reconvened the regular meeting at 7:48 p.m.

11. Claims

a. Report from the Human Resources Department regarding payment in the amount of $1,250.00 to Antonio McGhee for General Liability claim.

b. Report from the Public Works Department regarding payment #2 in the amount of $141,183.00 to Civil Constructors Inc. of East Moline, IL for the Water Filtration Facility Project for services provided from October 14, 2017 through November 13, 2017.

c. Report from the Public Works Department regarding payment in the amount of $28,607.13 to CJ Now Plumbing of Rock Island, IL for the relocation of the sanitary lateral for 3206 14th Avenue.

Motion:

Alderman Clark moved to accept the reports and authorize payments for Claims items a through c as recommended; Alderman Parker seconded.

Alderman Spurgetis asked for more information about the last Claims item for the sanitary lateral. Public Works Director Larry Cook said they could not find any plumbing permits that had been pulled at that address for the last three decades.

Vote:

Motion passed on a 6-0-1 roll call vote. Aye: Geenen, Clark, Mayberry, Spurgetis, Parker, and Schipp. Nay: None. Absent: Tollenaer

12. Claims for the weeks of November 17 through November 23 in the amount of $104,979.33 and November 24 through November 30 in the amount of $1,067,048.17; and payroll for the weeks of November 6 through November 19 in the amount of $1,453,910.04.

Motion:

Alderman Spurgetis moved to allow the claims and payroll; Alderman Mayberry seconded.

Vote:

Motion passed on a 6-0-1 roll call vote. Aye: Geenen, Clark, Mayberry, Spurgetis, Parker, and Schipp. Nay: None. Absent: Tollenaer

13. Report from the City Clerk regarding requests from the College Hill District businesses for permission to place signage in the city's right-of-way and decorate street lamp posts between 12th Avenue and 14th Avenue along 30th Street and for sound amplification for their Christmas Walk event to be held on Thursday, December 7, 2017 from 5:00 p.m. to 8:00 p.m.

Motion:

Alderman Schipp moved to approve the requests as recommended subject to removing signage and decorations after the event; Alderman Parker seconded.

Vote:

Motion passed on a 6-0-1 voice vote. Aye: Geenen, Clark, Mayberry, Spurgetis, Parker, and Schipp. Nay: None. Absent: Tollenaer

14. Other Business

Alderman Spurgetis thanked the Public Works Department for extending the free leaf pick-up until December 15.

No one signed up to address Council to speak on a topic.

15. Motion to Adjourn

Motion:

Alderman Parker moved to adjourn; Alderman Schipp seconded.

Vote:

Motion passed on a 6-0-1 voice vote. Aye: Geenen, Clark, Mayberry, Spurgetis, Parker, and Schipp. Nay: None. Absent: Tollenaer

The meeting adjourned at 7:52 p.m.

http://www.rigov.org/AgendaCenter/ViewFile/Minutes/_12042017-89