City of Centralia Council met Dec. 5.
Here is the minutes provided by the council:
The City Council for Centralia, Illinois met on Wednesday December 5, 2018, for a Work Session to discuss the 2019 Operating Budget. Mayor Ashby called the Work Session to order at 5:30 p.m.
Present: Mayor Ashby, Councilman Jones, Councilman Smith, and Councilman Sauer Absent: Councilman Marshall
Staff Present: City Manager, Dan Ramey; Treasurer, Bill Agee; Community Development Director, Gayla Harting; Police Chief, Brian Atchison; Economic Development Director, Rose Aldag-McVey; Finance Director, Michelle Liggett; City Clerk, Kim Enke
Announcements were made by the Economic Development Director, Rose Aldag- McVey. She announced the opening of a new restaurant, Rosati’s, in the Crooked Creek Crossing mall this coming summer. A press release was provided with the details of the development planned by Rachel Wallace. Mayor Ashby stated that this is a welcomed asset to the area and commended Rachel Wallace for pursuing and developing this for the community.
The City Manager provided information concerning the Route 161 IDOT Bridge project and his recent conversations with Kirk Brown from IDOT concerning the bid received from Plocher by IDOT and the pre- construction conference that has not been set at this time. Although he does anticipate that the meeting will be set before the holidays. Through negotiations and concerns being brought to the attention of IDOT by the City the initial estimated time of road closure has been reduced dramatically. He stated that Shattuc Road is to be closed for no more than 14 days and Noltings Road for no more than 120 days. He also added that the road is to be open by December or a penalty would be assessed to the contractor. He stressed that the City has requested an update from IDOT with a construction schedule as soon as possible in order to share the information with the public and entities effected. Mayor Ashby recalled the numerous conversations behind the scenes as well as the public meeting with IDOT, the City, and the concerned businesses earlier in the year. He stated that the initial time of closure was approximately 2 years or 30 months and now it is planned to be a minimal time of closure. He applauded the City Manager for his effort to bring these concerns to IDOT and his continuing conversations with them in order to keep the City informed.
City Manager Ramey provided an overview of the outlined budget. It is made up of the General Fund with many accounts in it for the various departments. The Other Funds are made up of the Airport, TIF Funds and Economic Development. There is also the Water Fund and Sewer Fund. He noted that the Other Funds, Water and Sewer are restrictive on what the funds can be spent on and also audited. When this Council took office in 2011, the expenditures were over $37 Million, which was also at the same time that there were financial committees formed to deal with the negative $20,000.00 in the general fund. Last year there was a $28 Million budget. This year the proposed budget is $27 Million. A Power Point was displayed to view the expenditures, revenues and the increases and decreases of expenditures per department. The Police Departments budget is proposed to increase from $3.4 Million to $3.8 Million. He stated that this request is almost exactly what was requested by the department. Last year the Fire Department was $2.3 Million and this year is $2.5 Million. A decrease is proposed for the City Council and Administration. Legal is the same as last year. Insurance has a proposed decrease of $44,000. The Boards and Commissions have an increase of over $21,000. Finance has an increase of approximately $4,500. Records has a proposed decrease of $2,509. Community Development has a proposed increase of $13,000 that includes funds for more demolitions. Streets and Alleys have increased approximately $42,000. He noted that Sanitation is an account where the funds are collected and charged what is due for the service. It has a slight increase of approximately $1,000. The Shop has a slight increase of approximately $3,500. Public Property has an increase of approximately $79,000. The Lake has an approximate $6,000 increase. The Animal Shelter has a decrease of approximately $3,500. ESDA has a slight increase of $505.00. Telecommunications has an increase of approximately $15,000 and Stock has a slight increase of $2,100. This General Fund budget has a total of $11,608,327 versus the 2018 budget of $10,870,402. This proposed budget has a $737,000 increase. 54% of this increase is comprised of $398,506 additional dollars for the Police Department and 28% of this increase is comprised of $204,670 in additional dollars for the Fire Department. The remaining portion of the increase is $134,749 which is for the other 17 departments in the City. The total General Fund has a 7% increase over last year.
He thanked the departments for reviewing their budgets and submitting their requested budgets. He stated that the Fire Department did have a $500,000 pumper truck requested that would cost approximately $70,000 per year if financed. The City Manager stated that the department understood that this was not the budget year for that purchase.
The revenue for 2019 was reviewed by the City Manager. He stated that the revenue would be approximately $11 Million which is approximately $600,000 less than the expenditures. He reviewed the past cash balances noting that in 2011 when the City Council took office the cash balance was negative $21,000 and in 2017 it was $1.6 Million. Mayor Ashby recapped the General Fund increase of $737,000 and a shortfall of approximately $500,000- $600,000 between the estimated revenue and expenditures proposed for 2019. He asked that the Mayor and Council review this proposed budget further and come to him with any revisions prior to the hearing on the 10th. The City Manager continued to review the revenue. He pointed out that the audited sales tax revenue in past years when the Council took office was $2.1 Million which has now increased by approximately $300,000. He stated that this increase is due to more taxable items being sold in retail businesses in Centralia. This reflects an increase in these businesses by $30 Million in sales. He noted that many cities are seeing decreases in sales tax while Centralia’s is moving forward. He also stated that if there would be an increase made to property taxes, he feels it would affect and lower the amount of money that the residents have to spend in the local businesses. He also believes by not raising taxes, this gives the businesses an incentive to develop and continue growing their businesses in Centralia knowing that there has been an additional $30 Million in taxable sales in the City. He continued to review the proposed revenue with an estimate of $11 Million noting that it was conservative. Councilman Sauer questioned the decrease of Telecommunication revenue over the years. City Manager Ramey stated that there are more wireless services compared to more individuals previously using Charter or other services.
City Manager Ramey continued to review each department in more detail. He pointed out the highlights of each department. He noted the Contingency Fund includes a sales tax rebate to Buchheit. He noted that the Boards and Commissions includes an increase to the Centralia Youth Association from $35,000 to $50,000 which he feels is an important services for the youth in the community. He noted the City continues to work with them after the Housing Authority no longer wanted the building this past year. Also the Chamber will have $2,000 budgeted and Centralia Clean and Green will have $30,000 budgeted, which is increased from the $25,000 last year. He reviewed Records and Finance Department noting that a postage machine is budgeted for 2019. In Community Development, grants will continue to be sought for demolitions. $50,000 is budgeted for further demolitions. The Street Department includes the pending projects with a budget of $1.3 Million. Public Property is budgeted at $836,689 and Lakes is budgeted at $62,802. City Manager Ramey reviewed the increase of the Police Department from $3.4 Million in 2018 and the requested and proposed $3.8 Million. In 2010, the budget was $2.7 Million. He stated that there are as many officers as there were in 2010. Chief Atchison stated that there are 22 officers currently and is authorized to hire 24, the hiring process continues. City Manager Ramey stated that the Police Department is the only department that has never seen a decrease. He reviewed the Pension costs of the department. The State law requires that by 2030 it should be 90% funded. The amount is calculated by an actuary. Last year the amount for the budget $743,000 this year is $923,000. Mayor Ashby pointed out that many municipalities have been raising their taxes to take care of the rising pension costs up to 40%. Councilman Sauer pointed out that some local entities have raised their tax levies to cover Police Pensions as well. Mayor Ashby stated that Herrin recently increased theirs by 37.5%. City Manager Ramey stated that the City recently lost a Pension case due to an officer that will be paid for disability due to an incident where an officer did not use his mask although required. He is now considered disabled and will be paid for 60-65% of his salary for the next 20 years. This cost is paid for by the taxpayers. City Manager Ramey reviewed the health insurance that is provided to the employees and their families stating that this is the best insurance of any City and he is proud to be able to provide it to the employees of the City. Mayor Ashby stated that the employment costs for the Police Department is a state issue. He estimated that most people probably don’t realize that it costs $135,000 to put an officer on the street including all additional expenses. Mayor Ashby also noted that the IML has a meeting coming up with the topic of pension reform being discussed. He stated some municipalities are funded only 17%-22%, noting that City is well above what is recommended by the state. Also he noted that for every dollar, fifty to fifty two cents goes to the pension. City Manager Ramey stated that he would entertain the idea of using part time officers that work for other entities, which would reduce the costs by not offering pensions and insurance. He expects this to be reviewed with the unions in the future. He stated the need for efficiency. Next, the Fire Department was reviewed that reflects an increase from $2.3 Million to $2.5 Million. The department had twenty one employees and thought they needed more and a new station when this City Council took office. They are now down to fifteen employees that are happy. He stated that he is very proud of the department and reiterated that the departments have to live within their means. Councilman Smith questioned the costs of workman’s compensation in the Police Department. City Manager Ramey explained that the rates are based on classifications assigned to each employee’s position. It is based on the average across the state in each classification. Other factors include prior experience with a modification number assessed due to the City’s prior claims. He noted that the City of Centralia’s modification is double and this has been going on for many years. He stated that this year is actually slightly better. He stated that training is important in order to reduce claims but the State has terrible workman’s compensation laws that effect the costs. He stressed that the budget has to operate the entire City and all services, it takes funds in all departments to keep the City operating and progressing. He stated that there is a lot of progress that has taken place and is pleased with the retail growth in the City. More announcements are expected in the near future.
City Manager Ramey continued to review the budget that included purchases. The increase to the street department includes the purchase of two trucks and further oil and chipping of roadways. Public property purchased handicap swings this past year for the Fairview Park and this coming year, concrete will be poured around the area along with padding being placed on top of it. Also the addition of swings is expected at the dog park area for children. He also stated that another set of screen netting at the tennis courts is included in the budget. A new mower is budgeted to be purchased in 2019. He also stated that a road overlay is planned next to the tot lot playground at Fairview Park. The lakes budget includes improvements and dismantling. The Police department has budgeted to purchase two cars at an estimated $64,000.00. Camera equipment and three mobile computers are also budgeted. The Fire station will have some work completed on the building. They are budgeted to purchase an extractor along with computers, hose, light sets, a vehicle extractor, thermal imagers and a roller assembly. He noted that while these items are in the budget, the items will not be purchased by the departments without his approval. The police and fire station at 222 S. Poplar, as it is financially possible, will be able to relocate the detectives office from the lower level to another area in the building since the administrative office have moved out. The animal shelter is budgeted to spend $5,000 to box in a carport, and $5,000-$6,000 for fencing in order to give the dogs some area to run. The Telecommunications Department will be purchasing a new computer and printer for dispatch. The Airport will be getting a 90% grant to complete a $265,000 project. The City will provide $35,000 for the project. This project includes adding an access taxi to runway nine and the northern spread of the flight pattern will be widened. In order to do this, more easements will need to be acquired. MFT will include improvements to Frazier. The previous Council had promised to do Frazier from Lincoln to Pleasant Street which has not been done and now will be. 10 miles of oil and chipping will be done. This year the City has paid off the bonds that the previous City Council had borrowed.
The Other Funds were reviewed including DUI, Drug fund, and vehicle impoundment. The TIF 3 fund has $60,000 budgeted for further façade grants. TIF 4 fund is budgeted for advertising and tourism. TIF 5 is budgeted for a splash pad at Fairview Park and some of the needed local match of the Hickory St. project. The Hickory project is a $600,000 project that $500,000 grant was provided for by IDOT. The overlay is from Broadway to 17th. He stated that it will include road as well as sidewalk improvements. This is one of the few streets that qualified for the STU Funds which is why this particular street was chosen. TIF 6 is budgeted to possibly have Gragg Street improved. He stated that with the development in the Meadow Woods area, he feels it is important to have the roadway improved in that area as well. He stated that possibly a TIF agreement could include reimbursing the City through the increment received from developments. He stated that in Tourism Celebrate Centralia will be provided with $6,500, Balloon Fest with $2,500, Halloween Parade $1,000 and Locust St. Festival $2,500. The Tourism commission and the City Manager would like to consider buying a driven trolley for the City. He stated having one in Centralia would be great if the logistics could be worked out. It would be a good touch and could be used for other various things such as Elmwood Speaks and other projects. City Manager Ramey stated that the City has not submitted an application yet but anticipates it being brought to the Department of Commerce and Economic Development. This application is to make the City eligible through the Revolving Loan Fund for $1 Million which would be a grant back to the City. With the improvements and increasing activity on the west side, roadways including 4th Street and Oak Park in addition to Brookside more often. He stated that this area would qualify. It is expected to be a $550,000 project. He stated that the other portion of the $1 Million could be used on the remaining improvements needed in order to paint the water tower near Pinnacle and it would be 100% grant. The other two funds include the Water and Sewer Fund. The Sewer Fund has a loan of $300,000, if it is paid off it will result in negative $189,000 but the City Manager would like to pay that loan off. The Water Replacement Fund in 2011 had $1 Million. By putting aside fifty cents per gallon a month in the fund, at the end of this year, the City is expected to have over $3.5 Million. He stated that the reserve funds, when necessary improvements are needed at the Water Plant, can be used along with any available grants for the projects. City Manager Ramey recalled that when this City Council took office, the sewer plant was under a mandate by the EPA and Attorney General for $28 Million. Only $2 Million is collected per year. The City was able to be removed from the restricted list. That mandate would have drastically increased the rates. He stated that currently the City is still working on several issues that they keep trying to pass onto the City as mandates. The plant will also be able to purchase a pickup truck with this budget.
City Manager Ramey provided a final overview of the budget stating that it includes spending one third of the reserves that has increased from a cash balance of negative $21,000 in 2012. The only other option would be to increase the levy and property taxes but he strongly does not recommend it due to it having a direct negative impact on the sales tax that is moving forward. Bills are being paid and the City is funding everything exactly as it should be including pensions. The City is living within its means.
Mayor Ashby acknowledged that there will be a public hearing prior to the next Council meeting in order to take comments and input prior to the Council meeting where the budget will be approved. The Mayor recapped the budget noting a reduction in administrative costs. He suggested the future City Council hire an Assistant City Manager. Mayor Ashby noted that he would like more inspections to housing to be completed in order to create a higher standard for landlords. The derelict properties are being taken care of by the City by demolition but the City needs to determine what is causing so many homes to become dilapidated. He is concerned that these types of properties become associated with crime and other problems in the community. He expressed that he was pleased with the budget and the departments working within their means.
With no further business to discuss, the Work Session was adjourned at 7:14 p.m.
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