Minutes Members Present Mr. Washington, Mr. Enz, Mr. Tripp, Mr. LaGesse, Mr. Miller, Mr. Sirois, Mr. Mulcahy, and Mr. Dodge Members Absent Mr. Olthoff, Mr. Stauffenberg, Mr. Whitis, and Mr. Vickery In Attendance Board Members Mr. Bossert, Mr. Arseneau, Mr. Reid, Mr. Hess, and Mr. Hildebrand Department Heads Steve McCarty, Adrianne Haley, Sandi Cianci, Bob Gessner, Kevin Duval, Josie Snyder, Stephanie Jackson, Sheriff Bukowski, Carl Brown, Mike Van Mill, Jamie Boyd, Bonnie Schaafsma, Lori Gadbois, and Debbie Woodruff Media None 1. Call to Order The meeting was called to order by the Vice-Chairman, Mr. LaGesse, at 9:00 a.m. Quorum present. 2. Public Comment 3. Approval of Minutes January 17, 2013 A motion to approve the minutes was made by Mr. Washington and was seconded by Mr. Dodge. Motion carried. 4. Presentations 5. County Auditor s Office Debbie Woodruff Monthly Claims The Committee reviewed the January 2013 Highway Claims that totaled $440,082.75 The Committee reviewed the January 2013 General & Special Funds Claims. The total General Fund Claims was $2,105,477.66 and the total of the Special Fund Claims was $3,827,498.77 for a grand total of $5,932,976.43. The Committee reviewed the County Board Payroll and Travel Mileage for December 1, 2012, through January 8, 2013. Mr. Enz made a motion to combine and approve the monthly claims and Mr. Dodge seconded it. Motion carried with a roll call vote of 9 ayes and 0 nays. Voting aye were Mr. Washington, Mr. Enz, Mr. Tripp, Mr. LaGesse, Mr. Miller, Mr. Sirois, Mr. Dodge, Mr. Mulcahy, and Mr. Bossert. Page 1
Ms. Woodruff stated that she has been helping Mr. Gadbois nail down a new lease for their mail machine. They have had some issues with Pitney Bowes on their billing and their lease is up in July. They are working on getting a new machine that will allow them to save some postage with certified mail. Instead of getting the green card back to us with the signature, the departments will be able to go online and get verification that it was received and they will be able to print off the signature sheet. It saves us about $1.20 on each piece of certified mail which adds up to about $5000 in savings. They are looking at two companies, Pitney Bowes and Neo Post, both have similar machines and products. She thinks that the processing of certified mail will be the deciding factor in which one they decide to go with. They are also looking at adding a machine that will do folding, inserting, and sealing. It will be used for the tax bills and assessment notices which will save about $10,000 yearly between those two departments. The machine will be paid for in about a year and a half. 6. Insurance Ms. Mackin did not have anything to report to the committee. 7. Treasurer: Mark Frechette County Treasurer s Report The Committee reviewed the County Treasurer s Report. County Collector s Report The Committee reviewed the County Collector s Report. Monthly Resolutions - February There Committee reviewed the monthly resolutions. Mr. Sirois made a motion to combine and approve the reports and Mr. Miller seconded it. Motion carried with a voice vote. E-Check Presentation Mr. Frechette stated that he has been working on E-Check with DevNet for a couple of years and it will be finalized this month. People will be able to go onto his website, put in their parcel number, and pay their tax bill electronically right at home. They can pay by credit card or an electronic check. This will bring less traffic to the banks and to his office. There is a $1.00 fee to do this. Mr. Dodge asked what the service fee is for a credit card. Mr. Frechette stated that it is still 2.1%. He worked out the same deal as last year. They wanted to charge 2.35% but he said he wanted it to stay the same. Mr. Bossert asked if this means that they do not need a copy of the bill or the stub from the bill. Mr. Frechette stated that that is not needed. It is just like going through your mortgage company. Page 2
Mr. Bossert asked if the fields repopulate if there are multiple properties. Mr. Frechette stated that you would have to put them in each time. Mr. Tripp asked if we are the first county in Illinois to do this. Mr. Frechette stated that we are the first and they are not charging us to do this because we are the first one. Mr. Dodge asked if the whole bill can be paid in June or do you have to enter it twice. Mr. Frechette stated he thinks that you can pay the total bill in June without entering it twice. It will all be explained and highlighted on the back of the bill and he will also have a big press release. Mr. Dodge asked about the banks that pay from an escrow account. Mr. Frechette stated that they do that totally different. The bank gives them a file with the parcel numbers, they sent it back with all the amounts that are due, and then the bank sends it back and they download it and the banks wire them the money. Mr. Mulcahy asked who gets the $1.00. Mr. Frechette stated that it goes to the third party, Federal Payments, for doing this whole system. He thinks that people will do this for $1.00. Mr. Sirois stated that he thinks that this is a great idea. Since the emails will be in the system, can he send out email reminders about the availability of this system for the next year? Mr. Frechette stated that he does not know. Mr. Dodge asked if this information will be in the bills when they are sent out. Mr. Frechette stated that it will be on the back in big black letters. He is not sure if he could put a message on the front of envelope. Ms. Woodruff stated that he could do that. Mr. Frechette stated that he will do that, if he can. Mr. Tripp asked if this needs to be run by the State s Attorney since we are the first ones to implement it. Mr. Frechette stated that it does not. There are no fees involved with the county. They were the first with DevNet back in 1999. Page 3
Mr. Dodge asked if the payer gets a receipt back through this company. Mr. Frechette stated that the company will send an electronic receipt. 8. Department Steve McCarty Draft FY12 Year-End Financial Reports Mr. McCarty stated that they are close to being done; he may bring final numbers to the March meeting. We are a little out of balance right now. The draft coming in at this point is around a negative $950,000 and it is eating into our fund balance. Not only is this a conversation to bring the committee up to speed on what the final numbers appear to be but also a discussion of the imbalance. While $1.5 million in fund balance sounds like a lot of money, it is actually only about a month to a month and a half of actual reserves. When something blurps on the radar screen now, we would have to react to it rather quickly so that we do not go into a complete negative fund balance. Mr. McCarty stated that the new refundings require new special funds for debt service payments and also a requirement for available balance in those funds so $270,931 was transferred out of the general fund into those special funds but he calculated it back in because technically it is still available for debt service payments, although, it is not recorded in the general fund. Mr. McCarty stated that the amount that will be recorded in our year-end financial statement right now is around $575,000 for our ending fund balance. We are within a couple thousand dollars of where we were when we ended FY 2010. Mr. McCarty stated that the year-end balance may change by approximately $75,000 because some of the expenses that were related to the courthouse grant were already done in FY12. They are researching right now how to identify that because of some of the expenses happened in 2012 and some will happen in 2013. Mr. McCarty stated that they will be turning all of this information over to the outside auditors by the end of next week, hopefully. The audit will then start in March. Other Miscellaneous Financial Reports Mr. McCarty reviewed and discussed the reports with the committee. Mr. Bossert stated that the fact that we wound up the year eating into our reserves by almost a million is not good news. If you back out the debt service adjustment, it is closer to $700,000. We definitely have to look at this current year s budget as our backto-the-wall dollar amount that we have to hit, if at all possible. As a board, do we need to think about whether that budget number is too high, based on the revenues that we are projecting? Some of the revenues are not picking up like we might want to see in the coming year. He doesn t think that we have projected optimistically and yet there is always the risk that some of the revenues will disappear and if anything like that happens we could have a real bad outcome. He doesn t think that they are prepared yet to talk about what budget we want to put out to department heads for the current year. We have already adopted a budget and yet the board could come back and amend that Page 4
budget. He has asked department heads to think about what things in their area they can economize with and try to help the whole cause. Many departments are already squeezed very tight and they can t expect a lot. It will be another effort like was done three years ago - to look at our total situation and try to get through this and get those reserves stabilized, if not improved this coming year. Mr. McCarty stated that this year s total sales tax is the lowest since 2003 which is not a good trend. We also lost $200,000 going into 2013 because of the tax caps. The early indication is that the county EAV will shrink again in the upcoming year which means another decrease to the general fund because of the tax cap calculations. We have had some revenues that have gone up but we have also had a couple of major ones go down and two of those together add up to $625,000, which is a major impact and leads to the pressure of trying to keep things balanced. Mr. McCarty stated that use tax and income tax went up in total and they continue to increase. Mr. LaGesse asked if the 2013 budget reflects the $625,000 of lost revenue. Mr. McCarty stated that the 2013 budget does reflect that. Mr. Hess asked if we lose that $75,000 of grant money if he cannot back it into 2012. Mr. McCarty stated that we do not. They are just trying to figure out how to properly show it; it is just an accounting issue. Mr. LaGesse stated that he would like to see us get started on negotiations with the union contracts six months before they actually expire so we don t end up having to pay out retro pay. FY12 GF Contingency Budget Adjustment Mr. McCarty stated that he needs the blessing of the Committee on this. A contingency budget adjustment is one of the last things that they do. He has a document that identifies the changes. It is more of an internal adjustment. The entire general fund budget is not being changed at all. It is just an internal movement from departments that were under budget to departments that had pressures from their operational side that took them beyond their original budget. Mr. Arseneau asked how much was budgeted for health insurance for 2013. Mr. McCarty stated that $4,150,000 was budgeted. Mr. Arseneau stated that his fear on the health insurance is that there are a lot of things that are going to be coming up with Obama Care and we might see a 15% to 20% increase on health insurance even if deductibles are raised or different plans are looked at. Page 5
Mr. McCarty stated it will only be for the last two months of this fiscal year so there could be a small change on the 2013 budget. The majority of that will hit the 2014 budget. Mr. Arseneau stated that he thinks that they will need to meet with Blue Cross Blue Shield and with our broker so they can look at some things to see what is happening with the claims. Mr. McCarty stated that that is definitely a potential major change that they have to look at when they are doing the budget. Mr. Bossert stated that we need to be watching what is happening in the insurance world. They did have a conversation with our insurance consultant, Bruce Shear, a couple days ago about the provisions of the Affordable Care Act that have to be implemented next year. There are a lot of questions as to what things have to happen and what things are still under discussion. Our consultant is saying that out in the industry there are some sizeable increases in the basic cost of administering the insurance on the part of the insurance companies, regardless of the loss ratios and the histories. They will have a history report in another month and will probably start testing the market in May and June. There is no doubt going to be some pressure on us and yet there are some other players in the market that may help with the bidding process to keep our cost under control. We will need to be very flexible as we go into another cycle as far as what health insurance coverage we have. Mr. Washington made a motion to approve and Mr. Tripp seconded it. Motion carried with a roll call vote of 9 ayes and 0 nays. Voting aye were Mr. Washington, Mr. Enz, Mr. Tripp, Mr. LaGesse, Mr. Miller, Mr. Sirois, Mr. Dodge, Mr. Mulcahy, and Mr. Bossert. 8. Other Business Sheriff s Year-End Report Sheriff Bukowski stated that they have completed their year-end budget review on their end but it is not final until the Department completes it. Sheriff Bukowski reviewed and discussed his report with the committee. They believe that they will spend somewhere around $13,641,000 coming from various budgets. He has broken it down into a lot of detail to show where the money comes from and then where it goes. Sheriff Bukowski stated that the Sheriff s Office brought in a gross $226,200 on sheriff s sales. The bad thing for our community is that they get a flat $600 for each time that they have a sheriff s sale. That tells you how many homes were taken away from people in the foreclosure business. It is not a good comment on our economy in our county. Sheriff Bukowski stated that they take in, just on bed rentals, $72 a day per federal inmate and Cook County inmate which is in the Special Services Unit and $60 per Page 6
day per inmate for regular Cook County inmates. Last year they brought in $10,552,000 on bed rentals, $300,000 in salary reimbursements, $44,000 in medical reimbursements, $27,000 in mileage reimbursements, and $172,000 with the inmate telephone program. When it is all said and done, the inmate program brought in this past year $11,223,182, which is a new record for them. Sheriff Bukowski stated that a lot of people wonder if they make money on the inmate program. They looked at the total revenue being $11,223,000 and then they compared that to their expenses. In the general fund, the personnel expenses added up to about $7,200,000, operational costs was another $2,120,000, maintenance personnel that were assigned to the two jails cost $284,000, utilities for those buildings was $550,000, health insurance cost for the correctional officers and administrative staff cost $1,120,000, and debt service was about $1,430,000. Their total expenses in the general fund were $12,721,000, the total pension fund cost $1,351,000, and the expense in the tort fund was $425,000. A total of the general fund, pension fund, and tort fund is $14,500,000. Last year, the percentage of our own local inmates that were in the jail averaged 38.7% so when you multiply that times the $14,500,000 in expenses you come up with $5,969,000. Out-of-county inmates made up 61.3% of the inmate population and when you multiply that by $14,500,000 you come up with $8,503,000. The difference of those numbers is $2,651,700 which is what they believe is how much that they came out ahead. If they did away with the 61% of out-of-county inmates that is generating that money, the county would still have the 31% of local inmates that are left that we have to pay for which means the county would have to come up with about $5,969,000 in new monies just to pay for our local inmates. Sheriff Bukowski stated that if he was sitting in the seat of a county board member he would like to know how we are faring with this program and it shows that there is a margin of revenues that are not spent directly on the correction s program and last year that amount was about $2.6 million. When they began bringing inmates into these new facilities in 2005 they averaged about 102 inmates a day from out-of-county and it has continued to increase just about every year since then which is a good thing. The bad side is that they had to hire more staff. For example, in the FY 2005-2006 they averaged about 420 inmates a day and the average cost for those inmates was about $45.90 per day per inmate, without a distinction of whether it was our inmates or out-ofcounty inmates. For the FY 2011-2012 year they averaged 261 local inmates per day and 414 out-of-county per day for a total average of about 675 inmates per day every day at those two facilities and the average daily cost last year dropped to $37.73, which speaks to the efficiencies that they have been able to do. Now they have reached another plateau, because there is not a lot of room for many more inmates. The only way that he can see that they are going to be able to generate more revenue will be an increase from their customers. Our elected representatives cannot come to an agreement on what the budget is so everything is kind of frozen for the feds so he doesn t know if or when we could see an increase. He hopes they don t tell us that we have to cut because they cannot afford to pay us more. He thinks that is a distinct possibility because the federal government is going to have to make some tremendous cuts. This is part of Homeland Security so it is one of the priority budgets but when they shut down an entire group in the Navy you get an idea of the uncertainty. Page 7
Mr. Arseneau asked how reimbursements become revenue, such as, reimbursement for the G8 Summit. Sheriff Bukowski stated that they get paid time and a half rate for each officer. They virtually make money on all of that because their guys, comparatively to the group that they pull from, do not make that much money. If they incur overtime expense because they send someone there, they get reimbursed a straight salary to backfill here and the time and a half for those who have to deploy somewhere else. In most cases, they are paying above and beyond what we are paying our guys. Mr. Hess stated that if his average cost is $37.73 a day per inmate, the federal program at $72 a day per inmate is paying for our $5,000,000 for out local inmates. Sheriff Bukowski stated the point that he was trying to make is that if they got rid of the inmate program then the county would have to come up with around $5 million for our local inmates. Mr. LaGesse stated that on top of that we made $2 million. Back when they started this program, they took a lot of heat for doing it but where would we be without this program. It has been a lifesaver to the county. Mr. Tripp stated that he thinks that Mr. Bukowski should be commended on his leadership on this whole program. Mr. LaGesse stated that he agrees with him. Sheriff Bukowski stated that he appreciates that but it is his staff that does this. He still goes to Washington and he still talks to the marshals but Mr. Downey is the one who does a lot of the legwork and has developed an outstanding relationship with all the individuals involved. 9. Old/New Business 10. Adjournment A motion to adjourn the meeting at 10:15 was made by Mr. Mulcahy and was seconded by Mr. Washington. Motion carried. Mike LaGesse, Vice-Chairman Joanne Langlois, Executive Coordinator Page 8