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TO: Mayor Richard C. Irvin
FROM: Stacey L. Hamling
Interim Chief Financial Officer/City Treasurer
DATE: June 6, 2017
SUBJECT:
An Ordinance Amending the Annual Budget for the Fiscal Year Beginning January 1, 2016 and Ending December 31, 2016 (Amendment #2 for the 2016 Fiscal Year)
PURPOSE:
To obtain the City Council’s approval of a proposed amendment to the 2016 City Budget.
BACKGROUND:
Pursuant to 65 ILCS 5/8-2-9.1 through 9.10, the City of Aurora operates under the budget system of government finance. The City Council adopted the 2015 budget on December 9, 2014 through the passage of Ordinance No. O14-070.
While the city attempts to anticipate all potential expenditures for a fiscal year when that year’s budget is developed, circumstances occasionally arise that require expenditures that were not contemplated in the original financial plan. 65 ILCS 5/8-2-9.6 permits a municipality operating under the budget system to amend its annual budget by a two third’s vote of its governing body.
The City Council approved one previous amendment to the 2016 City Budget on April 12, 2016.
DISCUSSION:
The attached, proposed ordinance, including its Exhibit A, would provide for certain changes in the 2016 City Budget. Below is an explanation for each change. The item numbers discussed below correspond to the item numbers assigned to each change detailed in Exhibit A.
Items 1 and 3: HOME Program (Offsetting Expenditures and Negative Expenditures of $984,800). These items constitute a technical correction of Budget Amendment #1 for 2016.
Items 2 and 4: General Fund and Capital Improvement Fund (Transfer from General Fund to Capital Improvement Fund of $3,000,000). These items constitute a reallocation of home rule state tax.
Items 5 and 16: Transfer from Property &Casualty Insurance Fund to Employee Health Insurance Fund of $1,476,000. These items provide resources to the Employee Health Insurance Fund to cover medical costs for current city employees and their families.
Items 6 and 12: Transfer from General Fund to Employee Compensated Benefits Fund of $1,225,000. These items provide resources to the Employee Compensated Benefits Fund to cover the accrued costs of severance and sick leave that were greater than expected.
Items 7 and 8: Supplemental Compensation, Law Department, General Fund (Expenditure Increases of Totaling $10,000). These items provide resources for costs associated with vacation buy back and year-end payouts that were higher than expected.
Items 9 and 10: Overtime for Sworn Personnel, Supplemental Compensation, Fire Department, General Fund (Expenditure Increase of $139,000). This item serves to provide resources for overtime worked by sworn firefighters and costs associated with vacation buy back that were greater than anticipated.
Item 11: Overtime for Sworn Personnel, Police Department, General Fund (Expenditure Increase of $519,000). This item serves to provide resources for overtime worked by sworn police officers that was greater than anticipated.
Item 13: Refuse Disposal Charges, Sanitation Fund (Expenditure Increase of $12,000). This item services to provide resources for the payment of refuse disposal charges that were higher than expected.
Item 14: Legal - Outside Attorneys, Hotel-Motel Tax Fund (Expenditure Increase of $2,000). This item adjusts the budget for legal fees associated with monitoring compliance with an economic development agreement.
Item 15: Supplies/Ambulance-Medical, Foreign Fire Insurance Tax Fund (Expenditure Increase of $200,000). These items provide resources for the purchase of power load systems for six city ambulances that the Foreign Fire Insurance Tax Administration Board elected to cover on behalf of the Fire Department. An adequate fund balance existed in the Foreign Fire Insurance Tax Fund to absorb the additional expenditures in 2016.
Item 17: Final Pay, Employee Compensated Benefits Fund ($1,300,000). This item provides resources for the payment of severance pay during 2016 that was greater than anticipated.
Item 18: Pensions - Widow/Widower, Police Pension Fund ($125,000). This item provides resources to cover the cost of widow/widower pensions during 2016 that was higher than anticipated.
Item 19: Pensions - Regular, Firefighters’ Pension Fund ($370,000). This item provides resources to cover the cost of regular service pensions during 2016 that was greater than expected.
Item 20: Health - Indemnity/PPO, Retiree Health Insurance Trust Fund ($25,000). This item provides resources to cover the cost of retiree healthcare claims during 2016 that was higher and anticipated.
If the proposed budget amendment is approved, budgeted expenditures in the 2016 budget will increase from $411,554,275 to $416,957,275.
IMPACT STATEMENT:
Not applicable
RECOMMENDATIONS:
That the City Council adopt the attached, proposed ordinance that would affect Amendment #2 to the 2016 City Budget.
cc: Alderman O’Connor, Chairman
Alderman Mesiacos
Alderman Bugg
Alderman Mervine, Alternate
CITY OF AURORA, ILLINOIS
ORDINANCE NO. _________
DATE OF PASSAGE ________________
title
An Ordinance Amending the Annual Budget for the Fiscal Year Beginning January 1, 2016 and Ending December 31, 2016 (Amendment #2 for the 2016 Fiscal Year).
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WHEREAS, the City of Aurora has a population of more than 25,000 persons and is, therefore, a home rule unit under subsection (a) of Section 6 of Article VII of the Illinois Constitution of 1970; and
WHEREAS, subject to said Section, a home rule unit may exercise any power and perform any function pertaining to its government and affairs for the protection of the public health, safety, morals, and welfare; and
WHEREAS, the City Council approved Ordinance No. O99-96 on November 9, 1999 adopting the budget system of finance for the City in lieu of the appropriation system in accordance with 65 ILCS 5/8-2-9.1 et. seq. and Code Section 2-312(a); and
WHEREAS, the City Council approved Ordinance No. O15-099 on December 8, 2015 adopting an annual budget for the City of Aurora for the fiscal year beginning January 1, 2016 and ending December 31, 2016; and
WHEREAS, the City Council approved Ordinance No. O16-018 on April 12, 2016 adopting an amendment to the annual budget for the fiscal year beginning January 1, 2016 and ending December 31, 2016; and
WHEREAS, the City of Aurora deems that it is necessary to incur certain expenditures during its 2016 fiscal year that were unanticipated at the time the annual budget for 2016 was adopted but are necessary so as to ensure the protection of the public health, safety, morals, and welfare; and
WHEREAS, the City of Aurora, in an exercise of its home rule powers, desires to amend its annual budget for the fiscal year beginning January 1, 2016 and ending December 31, 2016 so as to provide for the incurrence of said expenditures that were unanticipated at the time the annual budget was adopted; and
WHEREAS, adequate monies are available in the City treasury to pay said unanticipated expenditures.
NOW, THEREFORE, BE IT ORDAINED by the City Council of the City of Aurora, Illinois, as follows:
SECTION 1: That the annual budget of the City of Aurora for the fiscal year beginning January 1, 2016 and ending December 31, 2016 is amended as shown in the attached Exhibit A.
SECTION 2: That this ordinance shall be in full force and effect, and shall be controlling upon its passage and approval.
SECTION 3: That all ordinances or parts of ordinances thereof in conflict herewith are hereby repealed to the extent of any such conflict.
SECTION 4: That any Section or provision of this ordinance that is construed to be invalid or void shall not affect the remaining Sections or provisions, which shall remain in full force and effect thereafter.
PRESENTED to the City Council of the City of Aurora, Illinois, on the ____ day of _________, 2017.
FILED for inspection on the _____ day of__________, 2017.
PASSED by the City Council of the City of Aurora, Illinois, this ____ day of ________, 2017.
AYES _____ NAYS _____ ABSENT _____
APPROVED AND SIGNED by the Mayor of the City of Aurora, Illinois, this ______ day of _______, 2017.
______________________________
Mayor
ATTEST:
______________________________
City Clerk