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Vernon Hills

Village Blog October 2010

Mariano’s Fresh Market - Construction Update #2
October 26, 2010
 
Construction on the new Mariano’s site continues on schedule.  Underground utilities including sanitary, storm and water systems have been installed.  Work continues on curbs for the landscape islands throughout the parking lots along with light pole bases and should be completed by October 28.   Weather permitting, the initial course of asphalt for the parking lot is scheduled to be installed starting October 29 and be completed in two days.  
 
Regarding the building, exterior footings are completed and work continues on forming and placement of the foundation walls.  The masonry work is scheduled to start November 3.  This work will be ongoing to the site work.  We anticipate issuing a full building permit for the building itself within the next 30 days.   
 
Questions?  Please contact Building Commissioner Mike Atkinson at 847-918-3548 or Mikeat@vhills.org


YARD WASTE UPDATE:
10/21/2010

As we remove the leaves from our yards for another season just several reminders. One is that the last day of yard waste pick up is November 29 for Monday collection and November 30 for Tuesday collection.   After that time there will be no yard waste collection except the holiday tree collection in January.  
 
Also the subscription yard waste service is limited to 6 bags per pick up.  Any additional bags either need to be stored until the following week or you can purchase additional yard waste stickers for the number of bags over 6 at $2.05 per sticker for each bag.  These stickers can be purchased at the Village Hall, Dominicks, and the Sullivan Center.
 
Please let us know if you have general questions or you can contact Veolia on specific service questions at: Customer Service 847 623-3870.
 
Mike Allison mikea@vhills.org  or 847 918-3540.   


Daily Herald:  PACE Considers change to Popular Lake County Bus Route

Pace Bus Route 572-Potential Service Reduction
October 14, 2010
Pace Bus has recently evaluated Route 572 which operates from Waukegan to Vernon Hills at Cherry Valley, Lakeside and Westmoreland.  Based on ridership Pace is considering ending the current route at Westfield Hawthorn Center Routes 60 and 21.  If implemented this would end service in areas of the Village south and west of 60 and 21, including 60 West, Butterfield, Route 45, Oakwood and Cherry Valley.  To view the full route please go to www.pacebus.com and enter under routes, Route 572.
 
If you have concerns with ending Route 572 at Westfield Hawthorn Center please contact Pace Bus and the Village to provide your feed back.  The final decision on this change could happen by mid December 2010. 
 
Contact Mike Allison 847-918-3540 or mikea@vhills.org

NEW BUSINESS OCCUPANCIES
October 08, 2010
 
Hawthorn Hills Square:
Dick's Sporting Goods
 
Rivertree Court:
Sally Beauty Supply
Philly Cheesesteak Express
Halloween Warehouse
 
Westfield Hawthorn Center:
Sports and More
 
Westfield Hawthorn Center carts:
Costco (memberships)
Bico Australia
Powered by Nature
Just-4-U
 
Hawthorn Village Commons:
Costco (employment)
 
Vernon Square:
Kumar Dental Office - 250 Center #202

FISCAL OUTLOOK AND PROJECTIONS
October 5, 2010
 
A. Fiscal Outlook for FY2010-11
 
The projected General Fund surplus for FY2010-11 has improved significantly since the passage of the budget.  At the time the budget was passed, the projected General Fund surplus was $337 thousand*.  The General Fund surplus is now projected to be $1.93 million* which equates to an improvement of $1.59 million.  Of that $1.59 million improvement, $1 million is an accident of timing: the $1 million receipt from the sale of the Deerpath Atrium was anticipated to occur in FY2009-10, but it should actually occur in FY2010-11.  Even without the $1 million sale, the projection for the General Fund surplus has improved by $590 thousand, which results in a $930 thousand* surplus, in addition to the $1 million from the sale of the Deerpath Atrium property.  Other major positive revenue trends include:
 
  • A very strong positive revenue development that suggests a positive trend for the future is the fact that Sales tax is exceeding budgeted projections by $528,000.  Of that amount $480 thousand is the result of a trend that actual results are surpassing the budgeted projection by 5.4% for the first five months of the year (measured on a cash basis) and $48,000 is the anticipated effect of Dick’s and Tiger Direct on the remainder of FY2010-11.  The sales tax receipts for the first five months of this fiscal year (cash basis) have exceeded last year’s receipts for those same five months by 2.0%.
  • Licenses and Permits are anticipated to exceed budgeted projections by $262,500 as the result of building fees from the Victory Centre, Loyola/Cuneo, Mariano’s, PNC, Petsmart and Tiger Direct..
 
There are also several adverse revenue trends:
 
  • The telecommunications tax continues to decline, it is expected to fall short of budgeted projections by $170 thousand.
  • Lower interest rates are expected to result in investment income falling short of budgeted projections by $60 thousand.
  • Police personnel levels are expected to result in revenue from fines falling short of budgeted projections by $51 thousand.  With staff reductions, injuries and reassignments, the number of personnel writing tickets has been reduced by eight.
 
 
*Note, this number is on an accrual basis so it does not include $624 thousand of Accelerated Retirement Incentive payments accrued to FY20109-10 but disbursed in FY2010-11
 
Despite a very tight budget, a couple of expenditure factors are helping our expenditure picture in FY2010-11.  There was a $90,000 over budgeting error in the Police Telecommunications Division FICA/Medicare account that will not be spent.  There is also $67,244 thousand savings from the resignation of a police officer during the third month of the fiscal year (this resignation does not effect the police pension contribution this year but it will have a future effect).  Currently, the leading negative on the fiscal side is that legal expenditures are projected to exceed budget by $30,000.
 
The positive results for FY2010-11 is partly attributable to the Accelerated Retirement Incentive which is saving the Village about $914 thousand of salary and benefits with a FY2010-11 cost for incentive related subsidized retiree insurance projected to be about $96 thousand in FY2010-11.  Thus, the net savings in FY2010-11 are projected to be $808 thousand.
 
B. Fiscal Outlook for FY2011-12
 
The General Fund surplus is projected to fall back to $395 thousand in FY2011-12.  This occurs despite my projection that the sales tax revenues from the existing retail tax base continue to grow at 2%.  Also, with Mariano’s opening in June we are projected to generate $241 thousand of new sales tax from Dick’s, Tiger Direct and Mariano’s beyond the $48 thousand realized in FY2010-11.  Despite this positive trend in sales tax, General Fund revenues are projected to fall by $857 thousand from the current projected FY2010-11 levels for three reasons:
 
·         The $1 million received from the sale of the Deerpath Atrium property in FY2010-11 is nonrecurring.
·         With what information we have at this time, we can not anticipate large project building permit fees in FY2011-12.  This absence of large projects results in a $253 thousand drop in that revenue source from what we are currently projecting for FY2010-11.
·         With more existing Village investment maturing and having to be reinvested at lower interest rates, there is projected to be another $100,000 drop in investment earnings from what we are currently projecting for FY2010-11.
 
On the expenditure side, I am projecting a $260 thousand increase in fringe benefit costs and a $445 thousand increase in equipment costs in FY2011-12.  That $445 thousand increase in equipment costs includes reinstating some or the entire contribution amount to the Equipment Replacement Fund, the total contribution amounts to $290 thousand a year.  Also included in the increase in equipment is the replacement of squad cars.  Not projected to increase are contractual services, commodities, capital and salaries.
 
C. Factors Outside of this Analysis
 
Four significant factors are not included in this analysis:
 
  • Each percent of salary adjustments for all Village employees cost $92,540.  If those salary adjustments exceed the police pension’s actuarial assumptions for pay increases, then another $11,500 is added to the cost of a one percent increase, resulting in a total cost of about $104,000 for each one percent increase in pay.
  • Actors on the state level are expected to continue proposing reductions to the municipal share of state income tax.
  • Developments beyond Dick’s, Tiger Direct and Mariano’s could potentially help our sales tax revenues.  Other developments could also help building revenues and the Telecommunications Tax.
  • Additional revenue sources are not included in these forecasts.  There are three fairly significant sources that could be established by ordinance without special restrictions:  First, the Village could enact a 1% Food and Beverage Tax, generating about $700,000.  Second, the Village could also enact a 5% Natural Gas Utility Tax generating about $500,000.  Third, the Village could increase the Telecommunications Tax from 4.5% to 6.0% generating about $450,000.
 
D. Long-Term Financial Projections
 
Under the analysis outlined above, the General Fund cash balance should end FY2010-11 at about $17.8 million, which represents over eleven months of General Fund spending.  Depending on the size of the COLA, FY2011-12 could range from a small surplus to a several hundred thousand dollar deficit.  In FY2012-13, a deficit of $300 to $600 thousand  is likely because we will have to make the final debt service payment on the 2002 VHAC bonds during the same fiscal year that we have to make the first General Fund payment on the debt issued to refinance the TIF Notes.  After that, the analysis concludes that the Village should return to surpluses, even with minimal new retail development.  However, based on this analysis, if the Village takes on a major non-routine capital project, it will need raise revenues or reduce cash reserves.  Below, please find a projection of end of year balances through FY2015-16, using a mid range projection for a COLA adjustment occurring in FY2011-12:
 

 

 
Fiscal Yr
Fiscal Yr
Fiscal Yr
Fiscal Yr
Fiscal Yr
Fiscal Yr
 
2010-11
2011-12
2012-13
2013-14
2014-15
2015-16
General Fund
17,774,782
17,122,528
16,712,009
16,782,437
16,895,477
17,322,564
MFT
1,473,837
1,370,977
1,263,117
1,075,257
219,897
510,017
Total
19,248,619
18,493,505
17,975,126
17,857,694
17,115,374
17,832,581

 

 
As a measure of trends in our Strategic Reserve, the following graph shows the fluctuations in the General Fund Cash Balance since April 30, 2007:

For comments or questions please contact Larry Nakrin, Finance Director at  847-918-3544
 

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