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TO: Mayor Richard C. Irvin, Mayor
FROM: Christopher A. Minick, Chief Financial Officer/City Treasurer
Stacey L. Peterson, Director of Financial Operations
DATE: June 9, 2023
SUBJECT:
An Ordinance Amending the Annual Budget for the Fiscal Year Beginning January 1, 2022 and Ending December 31, 2022 (Amendment #2 for the 2022 Fiscal Year)
PURPOSE:
To obtain the City Council’s approval of a proposed amendment to the 2022 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 2022 budget on December 7, 2021 through the passage of Ordinance No. O21-066.
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 a previous amendment to the 2022 City Budget on July 12, 2022.
DISCUSSION:
The attached, proposed ordinance, including its Exhibit A, would provide for certain changes in the 2022 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 through 2 and 23 through 27: HOME Program (Offsetting Revenue and Expenditure Increases Totaling $2,093,200). These items adjust the budget for the actual annual HOME Program allocation and the additional HOME ARP allocation to the city. At the time the 2022 budget was prepared, we did not have final allocation information. The amounts included in the original 2022 budget reflected only an estimate of the allocation.
Items 3 and 28 through 31: CDBG COVID Program (Offsetting Revenues and Expenditures Increases Totaling $913,800). These items adjust the budget for the COVID-19 CDBG funding allocation to the city.
Items 4 and 32 through 38: Block Grant Fund (Offsetting Revenues and Expenditures Increases Totaling $1,571,000). These items adjust the budget for the actual annual CDBG Program allocation to the city. At the time the 2022 budget was prepared, we did not have final allocation information. The amounts included in the original 2022 budget reflected only an estimate of the allocation.
Items 5 and 40: Economic Development, TIF # 4 Bell Gale Fund (Offsetting Revenue and Expenditure Increase of $9,100). This item provides for the payment of redevelopment costs for the Bell Gale project for which the developer qualified for reimbursement under Resolution No. R12-239. Adequate fund balance was available in the fund to cover the costs.
Items 6 and 12: Transfer from General Fund to Capital Improvements Fund (Offsetting Revenues and Expenditures Increases Totaling $10,000,000). These items provide resources to the Capital Improvements fund to cover capital projects.
Items 7 and 50 through 56: Debt Service Fund (Increase Revenue of $15,660,000 and Expenditure Increase of $601,300). These items adjust the budget to account for the 2022 A GO bonds the city issued for various capital improvement projects.
Items 8 and 10: Transfer from General Fund to Property and Casualty Fund ($4,500,000). These items provide resources to the Property and Casualty Fund to cover the accrued costs associated with property and casualty insurance claims.
Items 9 and 11: Transfer from the General Fund to the Employee Compensated Benefits Fund ($6,000,000). These items provide resources to the Employee Compensated Benefits Fund to cover the accrued costs of severance and sick leave.
Items 3 Non-Departmental, General Fund (Expenditure increase of $500,000). This item adjusts the budget to account for the intergovernmental agreement the city has with the Aurora Public Library for the allocation of PPRT.
Items 14: Professional Fees/ Test New Hires, Human Resources, General Fund (Expenditure Increase of $42,000). This item adjusts the budget to account for the testing services for the hiring of new police and fire officers.
Item 15: Special Programs/Other, Economic Development, General Fund (Expenditure Increase of $50,000). This item provides for funding of the economic development agreement with Aurora Mart LLC (R21-165).
Items 16, 17 and 19: Salaries/Full-Time/Prior Year Retro, Various Departments, General Fund (Expenditure Increase of $2,727,000). These items provide for the payment of retroactive pay increases related to the settlement of collective bargaining agreements.
Item 18: Salaries/Overtime Sworn, Police Department, General Fund (Expenditure Increase of $2,001,200). This item provides for overtime costs that were greater than expected. Increases in the number of officers retiring and officers in training generated requirements for scheduling other officers to work.
Items 20 through 22: Equipment services Fund- Equipment and Fuel (Expenditure Increase of $744,000). These items serve to adjust the budget for the cost of fuel for city vehicles that was greater than expected during the year and to adjust the budget for the cost of automotive parts for repairs.
Item 39: Economic Development, TIF #14 Lincoln/Weston Fund (Expenditure increase of $4,500,000). This item adjusts the budget to account for the economic development agreement for the Copley Development project.
Item 41: Economic Development, TIF #7 W Farnsworth Fund (Expenditure increase of $424,800). This item adjusts the budget to account for the redevelopment agreement with the Pizzuti project.
Item 42: Economic Development, TIF #18 DAC Fund (Expenditure increase of $963,000). These items adjust the budget to account for the redevelopment agreement with the DAC Development LLC.
Items 43 and 44: Equitable Sharing Treasury Fund (Expenditure Increases Totaling $20,500). These items provide for the payment of costs for expendable tools and equipment to support law enforcement activities that were not initially budgeted for the year.
Item 45: ARPA Fund (Expenditure Increases Totaling $5,500,000). This item serves to adjust the budget for the ARPA grant to provide financial assistance to the Aurora Civic Center Authority.
Items 46 through 49: 2017 General Obligation Bond Fund (Expenditure Increases totaling $3,784,900). These items adjust the budget for capital expenditures for neighborhood street projects reclassified to the 2017 GO Bond fund, which closed the fund out at the end of 2022.
Item 57 through 60: Property & Casualty Fund - Liability Claims (Expenditure Increase Totaling $2,534,000). These items serve to adjust the budget for the payment of costs associated with general liability claims that were higher than expected during 2022. Adequate monies were available in the fund for the claims.
Item 61: Employee Health Insurance Fund (Expenditure Increasing Totaling $ 140,000). The increase is due to the number of employees moving to the high deductible plan.
Item 62: Employee Compensation Benefits Fund (Expenditure Increasing Totaling $ 602,200). This item serves to adjust the budget for the accrual of costs associated with employee severance, especially for firefighters and police officers, which were higher than expected during 2022. Adequate monies were available in the fund for the accrual of the costs.
IMPACT STATEMENT:
N/A
RECOMMENDATIONS:
That the City Council adopt the attached, proposed ordinance that would effect Amendment #2 to the 2022 City Budget.
cc: Finance Committee
CITY OF AURORA, ILLINOIS
ORDINANCE NO. _________
DATE OF PASSAGE ________________
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An Ordinance Amending The Annual Budget For The Fiscal Year Beginning January 1, 2022 and Ending December 31, 2022 (Amendment #2 For The 2022 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. O21-066 on December 7, 2021 adopting an annual budget for the City of Aurora for the fiscal year beginning January 1, 2022 and ending December 31, 2022; and
WHEREAS, the City Council approved Ordinance No. O22-051 on July 12, 2022 amending the annual budget for fiscal year beginning January 1 2022 and Ending December 31,2022 (Amendment # 1 for the 2022 Fiscal Year, and
WHEREAS, the City of Aurora deems that it is necessary to incur certain expenditures during its 2022 fiscal year that were unanticipated at the time the annual budget for 2022 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, 2022 and ending December 31, 2022 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, 2022 and ending December 31, 2022 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.