City of Centralia City Council met June 22.
Here is the minutes provided by the council:
Per Senate Bill 2135, the City Council for Centralia, Illinois met for a Work Session to discuss the amendment of the 2020 budget and possible staff restructuring. Mayor Williams called the Work Session to order at 5:00 p.m.
Present: Mayor Williams, Councilman Smith, and Councilman Sauer(all members attended electronically via teleconference) Councilman Marshall joined the call at 5:17 p.m.
Absent: Councilman Jones and Councilman Marshall (Councilman Marshall joined the call at 5:17 p.m.)
Staff Members Participating Physically at City Hall: Lowell Crow, City Manager; Bill Agee, City Treasurer, and
Kim Enke, City Clerk
Staff Members Participating Electronically: Chief John Lynch, Fire Department and Lt. Perez, Fire Department
City Manager Lowell Crow explained the anticipated loss of revenue as well as the process to identify approximately $600,000 in budget cuts without touching personnel. He stated that they have reviewed the reduced revenue anticipated for property tax, sales tax, personal property, court fees, oil royalties, gaming revenue, and income tax. He explained that the IML started identifying the areas that the communities would need to evaluate due to the COVID-19 shutdown. He stated that Assistant City Manager Lambert, City Treasurer Agee, and Finance Director Liggett each independently reviewed the figures and then they all met to review their calculations together. He stated that what they determined was that the property taxes would be approximately $88,000 less than budgeted for revenue, sales tax would be $380,000 less, personal property would be $110,000 less, court fees would be $40,000 less, oil royalties would be $80,000 less, gaming revenue would be $80,000 less and income tax would be $260,000 less for a total shortfall of $1,038,000 in expected revenue. He noted that the state expects income tax to be approximately $261 Million for the state. He stated that over the last few months the oil royalties and gaming revenue have not been paid to the city. He stated that the gaming is controlled by the state and they are just now providing the guidelines to allow them to start again. He stated that oil royalties crashed at the beginning of the COVID-19 pandemic and the average loss of $21,000 per month for gaming is what determined those projected amounts. He added that the oil prices were in the negative at one point during the pandemic which caused a hit to the City’s oil revenue. He also explained that he had asked the department heads to review their budgets. He asked them if they had to cut 30% of their budget, where would it be cut from. He also asked them how they would reorganize their departments. He also proposed that they consider a 5% decrease in pay. He stated that his recommendation for the non-union employees is a 2% reduction and the union negotiations would be discussed in executive session. He also stated that he also evaluated who could be split between water and sewer that were not currently which included himself, the Assistant City Manager, and the Treasurer which provided some savings. He stated that with these reductions in addition to not opening the swimming pool, the total savings of $541,457 was made possible. He stated that this amount is strictly only cuts identified by the department heads that would defer some maintenance and reductions in cost due to lower oil prices. He stated that salt was then able to be moved to motor fuel tax expenses. He stated that proposals to restructure departments were submitted by the department heads and one of them was the restructuring of the police department. He stated that this would cut one body at the Lt./Sgt. level and move them up to Deputy Chief. He stated that one Lt. would be kept and the determination has not been made yet concerning who would fill the position as Deputy Chief. He stated that the total cost savings would be approximately $120,000 if the reorganization occurred. He stated that he has told the unions that they were looking at some things but both of the unions including the FOP and PBPA would have to be notified that this restructuring was being considered. He reported that this restructuring does fall within management rights. He also noted that the Public Works Department would be restructured to go to a single maintenance division and would pay some of the public works individuals out of water and sewer. He explained that the total cost of an employee with wages in the $60,000 to $70,000 range actually costs $90,000 or more with benefits. He also noted that the Fire and Police costs are even more due to their pension costs. He stated that they have also reviewed other staff restructuring including reducing the code enforcement officers to one person, reducing the Treasurer to part-time, and the animal shelter staff to part-time. He stated that there are other positions that he recommended be added to staff, but at a later time. He also noted that there would be a cost savings involved with combining the Assistant City Manager and Economic Development Director. He stated that the reason he is proposing this restructuring is for cost savings based off the IML and other organizations feedback that states that this will not be over quickly. Also they are predicting that the unemployment percentage will still be at 10% the first of January and be in recession till next year. He stated that he is looking at the long range solutions including changes to the health care to get a larger cost savings. He also stated that he is considering bidding out other costs. He stated that the shortfall could possibly be covered by lake restoration money which is the only reserve, but there is not enough to cover two years. He stated that he has shared with the Council that last year ended in deficit of $800,000 due to shortfalls in sales tax, property tax, and other revenues. He stated that he expects a second year deficit and the city needs to plan on the revenues not being totally recovered. He stated that the National Restaurant Association has projected that 70-80% of the restaurants will go bankrupt based on surveys in the next year and could have an impact. He stated that Gordman’s has announced that they will not be reopening the local store or some of their other Stage store locations because of the overall impact. He stated that a new budget will be presented and without touching personnel or the lobbyist there is a savings of approximately $600,000. He stated that there will need to be some restructuring in order to come up with the other $400,000. Councilman Sauer asked for clarification of the Police restructuring to determine how it is different than the current structure. City Manager Crow stated that a Deputy Chief was proposed to be added due to looking at the standardized procedures and also the questions they have had concerning qualification procedures and certifications. He stated that they would eliminate one of the Sergeants. He stated that currently there is an Administrative Sergeant and two Lieutenants. He stated that two would be on patrol. He stated that the Deputy Chief would be in the administrative role overseeing the dispatchers, records, and certifications. He stated that one Lieutenant would remain in the detective bureau and the Chief would also oversee all operations, but the Administrative Sergeant position would be eliminated. Mayor Williams clarified that it would be one more patrolman on the street. Councilman Marshall asked if the Deputy Chief position would be a union position. City Manager Crow stated that it would be non-union so one person would move from union to non-union. Councilman Marshall confirmed that this would save approximately $120,000. Councilman Sauer stated that the City Manager has been reviewing this with the Council Members and Mayor during one on one meetings. Councilman Sauer stated that this reminds him of some the issues approximately 9 years ago that had to be addressed. He stated that last year was a bad deficit year and he knows that this year and possibly next year will also be due to the reduced revenues. Councilman Sauer stated that he felt that the City is in a better situation than some municipalities. City Manager Crow explained that other communities are facing the layoff of as many as 25 people, closing fire stations, and still $100,000 short of balanced budgets. He stated that Centralia is not in that bad of a situation. Councilman Sauer stated that the City is also in a better position due to the reduced debt load, but the City is still struggling due to the lack of revenue from COVID and other things. City Manager Crow stated that the addition of the IT/GIS person and a building inspector would be at a later date as the restructuring is completed and staff can be added later when some revenue increases. He noted that currently Michelle Liggett does some IT work, but he has found that having an IT Director will help recruit businesses. Councilman Sauer questioned if the $140,000 reduction in sanitation for a budgeted used vacuum truck. City Manager Crow confirmed it was that truck, some maintenance being deferred, and some are not being purchased as planned outside of the fire trucks which will be discussed further. Councilman Marshall stated that he is concerned that COVID will not be over anytime soon and no one knows how long this will affect the world and municipalities. City Manager Crow stated that another reason that he wants to combine the Economic Development Director and Assistant City Manager position is to free up some of the TIF and hotel motel taxes that are currently being used to pay a portion of both of those salaries. He stated that instead these funds could help promote and market the community and promote business and economic development. He stated that he had discussions with staff, Councilmen, and various business leaders to determine what is needed to see Centralia grow. Councilman Marshall noted that the budget could be effected for many years due to COVID. City Manager Crow stated that this is why he feels the restructuring is very important. He referred to the ILCMA recommendations concerning improving efficiencies while still providing necessary services. He discussed the possibility of reducing the animal shelter staff to part-time while still providing the services needed. He stated that the person at the shelter is eligible for retirement and this could be considered depending on the number of hours required. He stated that while discussing this with Gayla Harting and touring the facility, he believes they could still meet the responsibilities. He stated that they could also discuss the position of the Treasurer and whether it could be a part-time position. He shared that most communities the size of Centralia only have one code enforcement officer. He stated that currently there are two in addition to Gayla. He stated that when the opportunity arises the City would then bring on a building inspector. He stated that he feels that a contractor should be hired that could be trained by sending them through correspondence courses. He stated that he has done this in other communities and it will pay back the city in dividends. He stated that while speaking with developer, Greg Sutton, he noted that Centralia is using old building codes and there isn’t a standardization or a trained professional on staff. He stated that Gayla Harting is also recommending updating the code since the city is using an outdated BOCA code. He stated that this will support economic development within the community and update the City to International Building and Fire Codes. He stated that he also discussed this with Chief Lynch and he feels that this will have a long term effect on the community. He stated that the total structure as a whole was reviewed. He stated that 4-5 positions would be eliminated initially and then they could look at how they could go forward. City Manager Crow stated that the lobbyist was not discussed in detail but he has been working with him more closely. He stated that it may have an impact somewhat but he stated that he can’t see cutting people but keeping the lobbyist. Councilman Sauer stated that it’s not that he disagrees with the City Manager, but does feel that in the future, Centralia will need them. He stated that the position doesn’t require any benefits and that person does have talents that have been used in the past to bring in significant grants. He stated that he understands the current need but long-term he feels like he is needed. City Manager Crow stated that he agreed. Councilman Smith stated that he agreed with the City Manager and Councilman Sauer due to what is being faced. Mayor Williams asked for clarification about Public Property. City Manager Crow stated that there is a savings in that department due to one employee transferring from Public Property to Streets. He added that the position is Pat Stedelin. He stated that he is also the cemetery sexton. He stated that some of the discussion is to keep him part time for the cemetery only. He stated that ultimately Public Property would be fully absorbed by Public Works, so that role would not be filled and Public Works would be responsible for the maintenance of the buildings since currently Public Property is responsible for that. He stated that he and Jeff Schwartz also discussed the possibility of contracting out the cleaning of the buildings which is under the city’s management rights and the city would need to inform the union if it was determined to eliminate or layoff the position. Mayor Williams questioned if the city would then bid out and hire a cleaning service and City Manager Crow stated that he was correct. Councilman Marshall asked what department is making up the biggest portion of the $1,040,000 shortage in revenue. City Manager Crow stated that Public Works is making the largest amounts of cuts by deferring maintenance, not filling billets, and looking at reorganization. He stated that the next two are Police and Community Development. Councilman Marshall stated that he applauds City Manager Crow for going over the budget with a fine tooth comb. Councilman Marshall stated that he wondered if money could also be saved in other departments. He noted what a tough job the City Manager has to address the damage being caused by COVID and needing to look at all of these cost saving measures. City Manager Crow stated that the majority of expense in Fire and Police are personnel where Public Works has a large percentage of costs in vehicles and other services. He noted that the new police cars were already purchased so that was not a viable way to go. He stated that the public works department was able to shift the expenses where possible such as moving the salt to motor fuel tax. Councilman Marshall asked if the police department would be one person short of the staffing mandate. City Manager Crow stated that it would reduce a Sergeant position, but the School Resource Officer positions and patrol positions would still be filled. He noted that one Sergeant is not currently on patrol. He stated that the Deputy Chief would take over the role of the Administrative Sergeant. Mayor Williams asked to clarify if there will be one position lost. City Manager Crow stated that a Sergeant will be cut from the manpower but none of the patrol is changing number wise. He clarified that they currently have 24 officers and they will go down to 23, but one is an Administrative Sergeant which will be eliminated. He also clarified that currently there are two Lieutenants, five Sergeants and the rest are on patrol. He stated that with the restructuring there would be a Deputy Chief, one Lieutenant, four Sergeants, and the rest on patrol. Councilman Sauer referred to City Manager Crows comment about other communities closing fire stations. He asked if it is correct that both Fire Stations are needed in Centralia due to the way the staffing is sparsely staffed. He noted that while there are two locations, there is really only enough personnel for one force. City Manager Crow stated that Councilman Sauer is correct and there are only five firefighters on each shift spread in the two locations at any given time. He stated that the community he was referring to had sixteen on a shift and four are being eliminated from each shift. Mayor Williams stated that his biggest concern is the reduction of one police officer which is bothersome to him. Councilman Marshall stated that it is a tough conversation and it does look like each department is doing more with less. Councilman Sauer stated that the reason he finds it more acceptable is due to the fact that it is an administrative position. He stated that he doesn’t feel that the community would see much difference. Mayor Williams stated that he will consider it further to get a better understanding, but it is concern of his with the way things are right now. He stated that maybe he needs to sit down with the Chief and City Manager to get a better idea of the structure and how they will be patrolling the city at various time in order to not affect the protection provided.
City Clerk Enke stated that she did not have any submissions for public participation prior to the meeting. With no further business to discuss, the Work Session was adjourned at 5:44 p.m.
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