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VILLAGE OF MORTON GROVE, ILLINOIS
COMPREHENSIVE ANNUAL
FINANCIAL REPORT
For the Year Ended
December 31, 2014
Prepared by Finance Department
Remy Navarrete
Finance Director
VILLAGE OF MORTON GROVE, ILLINOIS
TABLE OF CONTENTS
Page(s)
INTRODUCTORY SECTION
Principal Officials and Officers .................................................................................... i
Organization Chart ........................................................................................................ ii
Certificate of Achievement for Excellence in Financial Reporting .............................. iii
Letter of Transmittal ..................................................................................................... iv-viii
FINANCIAL SECTION
INDEPENDENT AUDITOR’S REPORT .................................................................... 1-3
GENERAL PURPOSE EXTERNAL FINANCIAL STATEMENTS
Management’s Discussion and Analysis .................................................................. MD&A 1-15
Basic Financial Statements
Government-Wide Financial Statements
Statement of Net Position ............................................................................... 4-5
Statement of Activities ................................................................................... 6-7
Fund Financial Statements
Governmental Funds
Balance Sheet ............................................................................................. 8-9
Reconciliation of Fund Balances of Governmental Funds to
the Governmental Activities in the Statement of Net Position ................ 10
Statement of Revenues, Expenditures and Changes in Fund Balances ..... 11-12
Reconciliation of Governmental Funds Statement of Revenues,
Expenditures and Changes in Fund Balances to the Governmental
Activities in the Statement of Activities .................................................. 13
Proprietary Funds
Statement of Net Position .......................................................................... 14
Statement of Revenues, Expenses and Changes in Net Position ............... 15
Statement of Cash Flows ........................................................................... 16-17
VILLAGE OF MORTON GROVE, ILLINOIS
TABLE OF CONTENTS (Continued)
Page(s)
FINANCIAL SECTION (Continued)
GENERAL PURPOSE EXTERNAL FINANCIAL STATEMENTS (Continued)
Basic Financial Statements (Continued)
Fund Financial Statements (Continued)
Fiduciary Funds
Pension Trust Funds
Statement of Fiduciary Net Position ....................................................... 18
Statement of Changes in Fiduciary Net Position .................................... 19
Notes to Financial Statements ............................................................................. 20-71
Required Supplementary Information
Schedule of Revenues, Expenditures and Changes in Fund Balance -
Budget and Actual -
General Fund .................................................................................................. 72
Lehigh/Ferris Tax Increment Financing Fund ................................................ 73
Waukegan Road Tax Increment Financing Fund ........................................... 74
Notes to Required Supplementary Information ................................................... 75
Schedule of Funding Progress
Illinois Municipal Retirement Fund ............................................................... 76
Sherriff’s Law Enforcement Personnel Plan .................................................. 77
Municipal Employees’ Retirement Fund ........................................................ 78
Police Pension Fund ....................................................................................... 79
Firefighters’ Pension Fund ............................................................................. 80
Other Postemployment Benefit Plan .............................................................. 81
Schedule of Employer Contributions
Illinois Municipal Retirement Fund ............................................................... 82
Sherriff’s Law Enforcement Personnel Plan .................................................. 83
Municipal Employees’ Retirement Fund ........................................................ 84
Police Pension Fund ....................................................................................... 85
Firefighters’ Pension Fund ............................................................................. 86
Other Postemployment Benefit Plan .............................................................. 87
Schedule of Changes in the Employer’s Net Pension Liability and
Related Ratios
Police Pension Fund ....................................................................................... 88
Firefighters’ Pension Fund ............................................................................. 89
VILLAGE OF MORTON GROVE, ILLINOIS
TABLE OF CONTENTS (Continued)
Page(s)
FINANCIAL SECTION (Continued)
GENERAL PURPOSE EXTERNAL FINANCIAL STATEMENTS (Continued)
Required Supplementary Information (Continued)
Schedule of Investment Returns
Municipal Employees’ Retirement Fund ........................................................ 90
Police Pension Fund ....................................................................................... 91
Firefighters’ Pension Fund ............................................................................. 92
COMBINING AND INDIVIDUAL FUND FINANCIAL
STATEMENTS AND SCHEDULES
MAJOR GOVERNMENTAL FUNDS
Schedule of Expenditures - Budget and Actual - General Fund.......................... 93-95
Schedule of Revenues, Expenditures and Changes in
Fund Balance - Budget and Actual
Debt Service Fund .......................................................................................... 96
Capital Projects Fund ..................................................................................... 97
NONMAJOR GOVERNMENTAL FUNDS
Combining Balance Sheet ................................................................................... 98-99
Combining Statement of Revenues, Expenditures
and Changes in Fund Balances .......................................................................... 100-101
Schedule of Revenues, Expenditures and
Changes in Fund Balance - Budget and Actual
Motor Fuel Tax Fund ...................................................................................... 102
Commuter Parking Facility Fund ................................................................... 103
9-1-1 Emergency Telephone System Fund ..................................................... 104
Economic Development Fund ........................................................................ 105
Fire Alarm Fund ............................................................................................. 106
Seizure Fund ................................................................................................... 107
Dempster/Waukegan TIF Fund ...................................................................... 108
NONMAJOR PROPRIETARY FUNDS
Combining Statement of Net Position ................................................................. 109
Combining Statement of Revenues, Expenses
and Changes in Net Position ............................................................................. 110
Combining Statement of Cash Flows .................................................................. 111
VILLAGE OF MORTON GROVE, ILLINOIS
TABLE OF CONTENTS (Continued)
Page(s)
FINANCIAL SECTION (Continued)
COMBINING AND INDIVIDUAL FUND FINANCIAL
STATEMENTS AND SCHEDULES (Continued)
FIDUCIARY FUNDS
Pension Trust Funds
Combining Statement of Plan Net Position .................................................... 112
Combining Statement of Changes in Plan Net Position ................................. 113
STATISTICAL SECTION (Unaudited)
Financial Trends
Net Position by Component ..................................................................................... 114-115
Change in Net Position............................................................................................. 116-119
Fund Balances of Governmental Funds ................................................................... 120-121
Change in Fund Balances of Governmental Funds .................................................. 122-123
Revenue Capacity
Assessed and Actual Value of Taxable Property ..................................................... 124
Property Tax Rates - Direct and Overlapping Governments ................................... 125
Principal Property Taxpayers ................................................................................... 126
Property Tax Levies and Collections ....................................................................... 127
Debt Capacity
Ratios of Outstanding Debt by Type ........................................................................ 128
Ratios of General Bonded Debt Outstanding ........................................................... 129
Schedule of Direct and Overlapping Bonded Debt .................................................. 130
Schedule of Legal Debt Margin ............................................................................... 131
Demographic and Economic Information
Demographic and Economic Information ................................................................ 132
Principal Employers ................................................................................................. 133
Operating Information
Full-Time Equivalent Employees ............................................................................. 134
Operating Indicators ................................................................................................. 135
Capital Asset Statistics ............................................................................................. 136
COMPLIANCE SECTION
REPORT OF INDEPENDENT ACCOUNTANT’S ON COMPLIANCE ................. 137
INTRODUCTORY SECTION
- i -
VILLAGE OF MORTON GROVE, ILLINOIS
PRINCIPAL OFFICIALS AND OFFICERS
December 31, 2014
ELECTED TITLE/POSITION TERM/APPOINTMENT ENDS
Daniel DiMaria Mayor April 2017
Bill Grear Trustee April 2017
Shel Marcus Trustee April 2015
John Pietron Trustee April 2017
John Thill Trustee April 2015
Maria Toth Trustee April 2015
Janine Witko Trustee April 2015
Ed Ramos Village Clerk April 2017
APPOINTED
Ryan Horne Village Administrator December 31, 2014
Remy Navarrete Finance Director December 31, 2014
Nancy Radzevich Economic Development Director December 31, 2014
Teresa Hoffman Liston Corporation Counsel December 31, 2014
Thomas Friel Fire Chief December 31, 2014
Michael Simo Police Chief December 31, 2014
Andrew DeMonte Public Works Director December 31, 2014
Lauren Plahm Adjudication Hearing Officer December 31, 2014
Frank Tennant Village Prosecutor December 31, 2014
- ii -
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
Village of Morton Grove
Illinois
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
December 31, 2013
Executive Director/CEO
- iii -
Board of Trustees and
Citizens of the Village of Morton Grove
- v -
The Village of Morton Grove is governed as a home rule community under Illinois law and
operates under a President/Trustee form of government with a full time Administrator. The home
rule status was confirmed by a special referendum held on March 18, 1980.
As a home rule municipality, the Village is permitted to carry out its own governing procedures,
except where specifically prohibited by the State Legislature. The Village President and six
members Board of Trustees are elected at large for four-year terms. The President, with
concurrence from the Board, appoints the Village Administrator and all Department Directors.
The Village Administrator is the Chief Administrative Officer who oversees the day to day
operations of the Village. The Village has eight departments: police, fire, public works,
community and economic development, health and human services, code enforcement, finance and
administration.
The Village of Morton Grove Comprehensive Annual Financial Report (CAFR) includes all of its
governmental operation funds, pension trust funds (the Morton Grove Firefighters’ Pension Fund,
Morton Grove Police Pension Fund and the General Pension Fund). The accompanying financial
statements include only those funds of the Village, as there is no other organization for which it
has financial accountability. The pension funds are determined to be pension trust funds due to
their fiduciary and fiscal relationships with the Village as their sole purpose is to provide
retirement benefits to the Village’s civilian employees, sworn firefighters and police officers. The
Public Library is no longer reported as a discrete component unit with the implementation of
GASB Statement No 61.
The annual budget serves as the foundation for the Village’s financial planning and control.
Budgetary appropriations for the operations of various Village departments are established through
the adoption of an annual Budget Ordinance by the Village Board of Trustees.
On November 10, 1997, the Village Board of Trustees approved Ordinance 97-53 that changed the
fiscal year end date from April 30 to December 31. This was done to align property tax receipts
with the year they are intended to finance and allow the budget preparation process to begin when
municipal operations are generally at a more manageable level.
Local Economy
The Village of Morton Grove’s principal growth took place during the late 50’s and early 60’s
when the population increase from 7,427 to 20,533 residents. The Village primarily consists of
residential land uses. Significant industrial, office and commercial land uses are also located in the
community. Little vacant land remains for commercial and office development or light
manufacturing. Approximately twenty percent (20%) of the Village’s land area is Cook County
Forest Preserve property.
Although the Village’s population has stabilized several years ago, it remains a vibrant economic
community and is a desirable place to live. The unemployment rate remained relatively stable
over the years: however, it has risen to 8.9% in 2010 and remained the same until 2012 due to the
economic recession with a decrease to 8.7%.
Board of Trustees and
Citizens of the Village of Morton Grove
- vi -
Residents in Morton Grove enjoy a pleasant suburban environment with an easy commute into the
City of Chicago for work or entertainment.
The median income for a household in the village was $63,511, and the median income for a
family was $72,778. Males had a median income of $46,489 versus $34,730 for females. The per
capita income for the village was $26,973. About 1.9% of families and 2.7% of the population
were below the poverty line, including 2.3% of those under age 18 and 4.1% of those ages 65 or
over.
Like other communities, the Village of Morton Grove was affected by the prolonged national and
regional recession 2008 through 2012 and recovery from which is very slow. Economist have
declared this downturn to be a recession as there has been a deterioration of the labor market, and
declines in consumer spending, business investments and industrial production. Additionally, the
Federal Reserve has lowered interest rates to a current rate between 0-.25 percent in order to
attempt to promote the resumption of sustainable economic growth.
There are several factors that impact the local finances of the Village. These factors include
desirability of goods and services provided by the local business community and action taken by
the Village Board. During the calendar year the Village reco gnized changes in the local economic
climate. The sales tax trend has stabilized and showed signs of recovery. However building
permits and business license revenues still declining and has not returned to levels prior to the
economic downturn.
The Village is impacted at the local level by regional, state, and national economic conditions as
well as governance of the State of Illinois and weather conditions. Several important revenue
sources are affected by economic conditions beyond the Village’s control. The delay in income tax
revenue from the State of Illinois is currently 3 months behind and is jeopardizing the Village’s
ability to meet its payment obligations. Additionally, property tax receipts collected by the Cook
County are in flux as the billing and payment deadline dates are often delayed further making it
difficult to anticipate the cash flow and plan for the outstanding debt service.
The economy is not expected to fully recover for several years. Local governments are still being
faced with the difficult choices of reducing service levels, assessing staffing levels, and
maintaining adequate reserves. The Village of Morton Grove has weathered this recession and
slow recovery very well. By re-evaluating every aspect of the Village’s operations for
opportunities for new revenues and cost containment. Some of the positive cost containment
results were due to staff reductions with limited backfill, procurement savings realized through a
municipal partnering initiative in joint proposals for goods and services, reductions in general
operating expenses as a result of re-evaluating many budgeted items and cost-sharing through new
intergovernmental agreements with neighboring communities.
The Village Board, Management and staff is pleased to report that they have been successful in
achieving their primary goal of maintaining service levels to the greatest extent possible while
taking measures to reduce their expenditures.
Board of Trustees and
Citizens of the Village of Morton Grove
- vii -
A number of infrastructure improvements have been completed throughout the Village in recent
years. These improvements are most prominent in the Village’s two (3) tax increment financing
districts (TIF). The Lehigh/Ferris tax increment district has been designated for transit -oriented
development which has fostered new condominium and town home development. A main Village
arterial street is also scheduled for improvements in the upcoming years which will allow for
needed infrastructure upgrades and an improved streetscape.
Long-Term Financial Planning
An analysis of long range issues invariably focuses on the Village’s infrastructure. Approximately
$30 million of streets, alleys, bridges, water mains, and storm sewers are deployed throughout the
Village. Routine maintenance and restoration is a significant expense each year. The continued
viability of this infrastructure network is a priority for the Village Board.
In response to the long-range need to finance infrastructure work, the Village is very active in the
area of economic development. The Village works to attract new businesses to the community
while retaining and strengthening existing establishments. The Village has been active in its use of
tax increment financing (TIF) and private activity bonds assistance to promote economic
development. The ultimate goal is for the resulting economic growth to provide additional sales
tax and other resources to help support the existing tax base of the Village.
Major Initiatives and Accomplishments
The Village provided the framework goals to provide outstanding services and programs in a
fiscally prudent environment. The goals included continuing to improve the operating budget and
financial practices to promote efficient service delivery, fiscal responsibility and transparency,
continuing to improve operations, maximize quality of service and efficiency, enhancing the
Village’s community planning and economic development efforts, develop intergovernmental
relationships, enhancing the Village communication program to promote dissemination of
information to customers and improving the capital improvement program in an effective and
fiscally-responsible manner.
The Waukegan Road tax increment financing district has been successful in removing unsightly
properties and promoting a feeling of increased safety and pride in the community.
The Lehigh/Ferris tax increment financing district has made significant progress with the
development of several new condominiums and town homes. In November, 2007, the Village
issued $9.2Million General Obligation Bonds to finance infrastructure improvements for the
district.
Board of Trustees and
Citizens of the Village of Morton Grove
- viii -
In 2012 Standard and Poor’s Rating Services has assigned its ‘AA’ long-term rating to the Village
of Morton Grove, Ill.’s series 2010A and 2010B general obligation bonds, reflecting the Village’s:
Participation in the deep and diverse Chicago metropolitan area economy;
Very strong income and extremely strong wealth indicators;
Good management practices that have led to maintenance of very strong general fund
reserve levels; and
Financial flexibility due to village’s status as a home rule community.
The Village intends to use the $9.975Million in bond proceeds to fund the capital equipment and
infrastructure improvements in and for the Village, including but not limited to waterworks and
sewerage system improvements, street improvements and the purchase of a new ambulance.
Awards and Acknowledgements
The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for
Excellence in Financial Reporting to the Village for its comprehensive annual financial report
(CAFR) for the fiscal year ended December 31, 2013. This was the twenty-sixth consecutive year
that the government has received this prestigious award. In order to be awarded a Certificate of
Achievement, the government must publish an easily readable and efficiently organized CAFR.
This report satisfied both generally accepted accounting principles (GAAP) and applicable legal
requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current
CAFR continues to meet the Certificate of Achievement Program’s requirements and we are
submitting it to the GFOA to determine its eligibility certification.
The preparation of this report on a timely basis could not be accomp lished without the efficient
and dedicated services of the entire staff of the Finance Department, and the cooperation and
assistance rendered by the staffs of other operating departments of the Village. I would like to
express my appreciation to all of those employees who assisted and contributed to its preparation.
Finally, appreciation is expressed to the Village President and Board of Trustees for their
leadership and support in planning and conducting the fiscal affairs of the Village in a responsible
manner.
Sincerely,
______________________________
Remy Navarrete
Finance Director/Treasurer
FINANCIAL SECTION
INDEPENDENT AUDITOR’S REPORT
- 2 -
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects,
the respective financial position of the governmental activities, the business-type activities, each
major fund and the aggregate remaining fund information of the Village of Morton Grove,
Illinois, as of December 31, 2014, and the respective changes in financial position and, where
applicable, cash flows thereof for the year then ended in accordance with accounting principles
generally accepted in the United States of America.
Emphasis of Matter
The Village adopted GASB Statement No. 67, Financial Reporting for Pension Plans, replaces
the requirements of Statement No. 25, Financial Reporting for Defined Benefit Pension Plans
and Note Disclosures for Defined Contribution Plans. Our opinions are not modified with
respect to this matter.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
management’s discussion and analysis and other required supplementary information be
presented to supplement the basic financial statements. Such information, although not a part of
the basic financial statements, is required by the Governmental Accounting Standards Board,
who considers it to be an essential part of financial reporting for placing the basic financial
statements in an appropriate operational, economic or historical context. We have applied certain
limited procedures to the required supplementary information in accordance with auditing
standards generally accepted in the United States of America, which consisted of inquiries of
management about the methods of preparing the information and comparing the information for
consistency with management’s responses to our inquiries, the basic financial statements, and
other knowledge we obtained during our audit of the basic financial statements. We do not
express an opinion or provide any assurance on the information because the limited procedures
do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
We also have previously audited, in accordance with auditing standards generally accepted in the
United States of America, financial statements of the governmental activities, business-type
activities, each major fund and the aggregate remaining fund information of the Village as of and
for the year ended December 31, 2013, the prior year in the year ended December 31, 2014 (none
of which is presented herein), and we expressed unmodified opinions on those financial
statements. That audit was conducted for purposes of forming an opinion on the financial
statements as a whole.
- 2 -
GENERAL PURPOSE EXTERNAL FINANCIAL STATEMENTS
(See independent auditor’s report.)
MD&A 1
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS
DECEMBER 31, 2014
As management of the Village of Morton Grove, Illinois (“the Village”) or (“Morton Grove”),
we offer readers of the Village’s financial statements this narrative overview and analysis of the
financial activities of the Village for the calendar year ended December 31, 2014. We encourage
readers to consider the information presented here in conjunction with additional information
that we have furnished in our letter of transmittal, which can be found on pages iv-viii of this
report.
FINANCIAL HIGHLIGHTS
The Village’s total position increased as a result of this year’s operations. Net position of
governmental activities increased by $459,704, and the net position of the business-type
activities increased by $1,860,670 resulting in total ending net position for the year of
$46,376,176.
During the year, government-wide revenues before transfers for the governmental and
business-type activities total $42,197,777, while expenses totaled $39,877,403, resulting
in the increase in net position of $2,320,374.
USING THIS ANNUAL REPORT
This annual report consists of a series of financial statements. The Statement of Net Position and
the Statement of Activities provided information about the activities of the Village as a whole
and present a longer-term view of the Village’s finances. For governmental activities, these
statements tell how these services were financed in the short term as well as what is available for
future spending. Fund financial statements also report the Village’s operations in more detail
than the government-wide statements by providing information about the Village’s most
significant funds. The remaining statements provide financial information about fiduciary
activities for which the Village acts solely as a trustee or agent for the benefit of those outside of
the government.
GOVERNMENT-WIDE FINANCIAL STATEMENTS
The government-wide financial are designed to provide readers with a broad overview of the
Village’s finances, in a manner similar to a private-sector business.
The Statement of Net Position reports information on all of the Village’s assets and liabilities,
with the difference between the two reported as net position. Over time, increases or decreases
in net position may serve as a useful indicator of whether the Village’s financial position is
improving or deteriorating. Consideration of other nonfinancial factors, such as changes in the
Village’s property tax base and the condition of the Village’s infrastructure, is needed to assess
the overall health of the Village.
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 2
The Statement of Activities presents information showing how the Village’s net position
changed during the most recent calendar year. All changes in net position are reported as soon as
the underlying event giving rise to the change occurs, regardless of the timing of related cash
flows. Thus, revenues and expenses are reported in this statement for some items that will result
in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation
leave).
Both of the government-wide financial statements distinguish functions of the Village that are
principally supported by taxes and intergovernmental revenues (governmental activities) from
other functions that are intended to recover all or a significant portion of their costs through user
fees and charges (business-type activities). The governmental activities reflect the Village’s
basic services, including general government, police, fire, public works, economic development,
senior services, emergency 911 services, fire alarm, tax increment financing districts, motor fuel
taxes and related expenditures, and capital projects. Sales tax, property tax levies, and shared
state income taxes finance the majority of these services. Business-type activities of the Village
consist of the municipal water and sewer system, solid waste and municipal parking operations.
FUND FINANCIAL STATEMENTS
A fund is a grouping of related accounts that is used to maintain control over resources that have
been segregated for specific activities or objectives. The Village, like other local governments,
uses fund accounting to ensure and demonstrate compliance with finance-related legal
requirements. All of the funds of the Village can be divided into three categories: governmental
funds, proprietary funds, and fiduciary funds.
GOVERNMENTAL FUNDS
Governmental Funds are used to account for essentially the same functions reported as
governmental activities in the government-wide financial statements. However, governmental
fund financial statements focus on near-term inflows and outflows of spendable resources, as
well as on balances of spendable resources available at the end of the fiscal year. Such
information may be useful in evaluating a government’s near-term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial
statements, it is useful to compare the information presented for government funds with similar
information presented for governmental activities in the government-wide financial statements.
By doing so, readers may better understand the long-term impact of the government’s near-term
financing decisions. Both the governmental fund balance sheet and the governmental funds
statement of revenues, expenditures and changes in fund balances provide a reconciliation to
facilitate the comparison between governmental funds and governmental activities.
The Village maintains twelve individual governmental funds. Information is presented separately
in the governmental funds balance sheet and in the governmental funds statement of revenues,
expenditures, and changes in fund balances for the General Fund, the Debt Service Fund, the
Lehigh/Ferris TIF Fund and the Waukegan Road TIF Fund and the Capital Projects Fund, all of
which are considered to be Major Funds. Data from the other seven governmental funds are
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 3
combined into a single, aggregated presentation. Individual fund data for each of these non -
major governmental funds is provided in the form of combining statements in a later section of
this report.
The Village adopts an Annual Budget for all funds. A budgetary comparison statement has been
provided where appropriate to demonstrate compliance with these budgets.
PROPRIETARY FUNDS
The Village maintains one type of proprietary fund. The Enterprise Fund is used to report the
same functions presented as business-type activities in the Government-Wide Financial
Statements. The Village uses an Enterprise Fund to account for its municipal water and sewer
operations, solid waste function and municipal parking lots.
Proprietary Funds provide the same type of information as the Government-Wide Financial
Statement, only in more detail. The Proprietary Fund financial statement provides separate
information for the Water and Sewer Fund, which is considered to be a major fund of the
Village. Individual fund information for non-major enterprise funds is found in combining
statements in a later section of this report.
FIDUCIARY FUNDS
Fiduciary Funds are used to account for resources held for the benefit of parties outside the
government, such as the Municipal Employees’ Retirement Fund, Police Pension Fund and
Firefighters’ Pension Fund. Fiduciary funds are not reflected in the government-wide financial
statements because the resources of those funds are not available to support the Village’s own
programs. The accounting use for fiduciary funds is much like that used for Proprietary Funds.
NOTES TO THE FINANCIAL STATEMENTS
The notes provide additional information that is essential to a full understanding of the data
provided in the Government-Wide and Fund Financial Statements. These notes can be found
beginning with page 20 of this report.
OTHER INFORMATION
In addition to the basic financial statements and accompanying notes, this report also presents
certain required supplementary information concerning the Village’s Illinois Municipal
Retirement Fund, Sherriff’s Law Enforcement Personnel Plan, Municipal Employee’s
Retirement Fund, Police and Firefighters’ Pension Fund, and Other Post-Employment Benefit
Employee Pension Obligation. The required supplementary information also contains budget to
actual comparison schedule for the General Fund, Lehigh/Ferris TIF Fund and the Waukegan
Road TIF Fund. Required supplementary information can be found on pages beginning with
page 72 of this report. The combining statements referred to earlier in connection with non-major
governmental funds are presented immediately following the required supplementary
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 4
information. Combining and individual fund statements and schedules for the Village can be
found on pages beginning with page 93 of this report.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
Net position may serve over time as a useful indicator of a government’s financial position. The
following tables show that in the case of the Village of Morton Grove, assets exceeded liabilities
by $46,376,176 at December 31, 2014, compared to $44,055,802 at December 31, 2013:
A large portion of the Village’s net position, $50,320,194, reflects its investment in capital assets
(for example, infrastructure, land, buildings and improvements, machinery, and equipment), less
any related debt used to acquire those assets that is still outstanding. The Village uses these
capital assets to provide services to citizens; consequently, these assets are not available for
future spending. Although the Village’s investment in its capital assets is reported net of related
debt, it should be noted that the resources needed to repay this debt must provide from other
sources, since the capital assets themselves cannot be used to liquidate these liabilities.
An additional portion, $15,893,795, of the Village’s net assets represents resources that are
subject to external restrictions on how they may be used, including restrictions for future street
improvements, debt service payments, public safety, and future capital development.
Village of Morton Grove Net Position (in thousands)
Governmental Business-Type
Activities Activities Total
Category 12/31/14 12/31/13 12/31/14 12/31/13 12/31/14 12/31/13
Current and other assets 33,867$ 33,073$ 5,344$ 5,201$ 39,211$ 38,274$
Capital assets 57,430 58,072 9,427 8,011 66,857 66,083
Deferred outflows 43 56 - 7 43 63
Total assets and deferred outflows 91,340 91,201 14,771 13,219 106,111 104,420
Current and other Liabilities 1,856 2,285 1,135 939 2,991 3,224
Long-Term liabilities 42,613 42,704 3,995 4,499 46,608 47,203
Deferred inflows 10,136 9,937 - - 10,136 9,937
Total liabilities and deferred inflows 54,605 54,926 5,130 5,438 59,735 60,364
Net position:
Net investment in capital assets 44,444 45,226 5,876 4,945 50,320 50,171
Restricted 15,894 14,644 - - 15,894 14,644
Unrestricted (23,603) (23,595) 3,765 2,836 (19,838) (20,759)
Total net position 36,735$ 36,275$ 9,641$ 7,781$ 46,376$ 44,056$
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 5
NORMAL IMPACTS
There are six basic (normal) transactions that will affect the comparability of the Statement of
Net Assets summary presentation:
1) Net Results of Activities – which will impact (increase/decrease) current assets and
unrestricted net position.
2) Borrowing for Capital – which will increase current assets and long-term debt
outstanding.
3) Spending Borrowed Proceeds on New Capital – which will reduce current assets and
increase capital assets. There is a second impact, an increase in invested in capital assets
and an increase in related net debt, which will not change the net investment in capital
assets.
4) Spending Nonborrowed Current Assets on New Capital – which will (a) reduce current
assets and increase capital assets and (b) will reduce unrestricted net position and
increase net investment in capital assets.
5) Principal Payment on Debt – which will (a) reduce current assets and reduce long-
term debt and (b) reduce unrestricted net position and increase net investment in capital
assets.
6) Reduction of Capital Assets through Depreciation – which will reduce capital assets
and reduce net investment in capital assets.
Following is a table that summarizes the change in net position of the Village at the close of the
fiscal year, with a comparison to the preceding fiscal year.
(This space intentionally left blank)
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 6
(This space intentionally left blank)
Village of Morton Grove Changes in Net Position (in thousands)
Governmental Business-Type
Activities Activities Total
Category 12/31/14 12/31/13 12/31/14 12/31/13 12/31/14 12/31/13
Revenues
Program revenues
Charges for services 4,390$ 4,034$ 10,722$ 9,868$ 15,112$ 13,902$
Operating Grants 829 759 - - 829 759
Capital Grants 159 462 58 59 217 521
General revenues
Taxes 25,355 25,296 - - 25,355 25,296
Investment income 16 12 3 3 19 15
Miscellaneous 363 414 302 350 665 764
Total revenues 31,112 30,977 11,085 10,280 42,197 41,257
Expenses
General government 3,750 3,827 3,750 3,827
Public safety 19,225 18,774 19,225 18,774
Streets and sidewalks 4,044 5,823 4,044 5,823
Vehicle maintenance 793 847 793 847
Health and human services 283 270 283 270
Community development 981 467 981 467
Building and inspectional services 795 846 795 846
Interest 781 805 781 805
Water and sewer 7,356 6,771 7,356 6,771
Solid Waste 1,858 1,869 1,858 1,869
Municipal Parking 11 12 11 12
Total expenses 30,652 31,659 9,225 8,652 39,877 40,311
Change in net position 460 (682) 1,860 1,628 2,320 946
Prior period adjustment - - - - - -
Net position - January 1 36,275 36,957 7,781 6,153 44,056 43,110
Net position - December 31 36,735$ 36,275$ 9,641$ 7,781$ 46,376$ 44,056$
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 7
NORMAL IMPACTS
There are eight basic (normal) impacts on revenues and expenses are reflected below:
Revenues:
1) Economic Condition – which can reflect a declining, stable, or growing economic
environment and has a substantial impact on state income, sales and utility tax revenue as
well as public spending habits for building permits, elective user fees, and level of
consumption.
2) Increase/Decrease in Village-Approved Rates – while certain tax rates are set by
statute, the Village Board has significant authority to impose and periodically
increase/decrease rates (property taxes, water, sewer, impact fees, building fees, home
rule sales tax, etc.)
3) Changing Patterns in Intergovernmental and Grant Revenue (both Recurring and
Nonrecurring) – certain recurring revenues (state-shared revenues, etc.) may experience
significant changes periodically, while nonrecurring (or one-time) grants are less
predictable and often distorting on their impact on year-to-year comparisons.
4) Market Impacts on Investment Income – the Village’s investment policy is managed
using similar average maturity to most governments. Market conditions may cause
investment income to fluctuate.
Expenses:
5) Introduction of New Programs – within the functional expense categories (general
government, public works, public safety, etc.), individual programs may be added or
deleted to meet changing community needs.
6) Change in Authorized Personnel – changes in service demand may cause the Village
Board to increase/decrease authorized staffing. Personnel costs (salary and related
benefits).
7) Salary Increases (Annual Adjustments and Merit) – the ability to attract and retain
human and intellectual resources requires the Village to strive to approach a competitive
salary range position in the marketplace.
8) Inflation – while overall inflation appears to be reasonably modest, the Village is a
major consumer of certain commodities such as supplies, fuels, and parts. Some functions
may experience unusual commodity-specific increases.
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 8
GOVERNMENTAL ACTIVITIES
Revenues:
Revenues for governmental activities totaled $31,111,673 at December 31, 2014.
Property tax (and replacement tax) continues to be the Village’s largest revenue source
totaling $12,843,179 representing 41.28% of total governmental activity revenue. Sales
tax revenue was $6,413,855 or 20.62% of total governmental activity revenue. Charges
for Services revenue was $4,390,147 or 14.11% of total governmental activity revenue.
State income tax revenue was $2,227,959 or 7.16% of total governmental activity
revenue. Miscellaneous taxes revenue (local use, real estate transfer, hotel & motel tax,
food & beverage, gasoline tax and others) was $1,860,128 or 5.98% of total
governmental activity revenue. Telecommunication tax was $781,166 or 2.51% of total
governmental activity revenue. A utility tax (Electric & Natural gas tax) was $1,228,883
or 3.95% of total governmental activity revenue.
Comparison with Prior Year.
Property tax and replacement tax revenue decreased by $103,934 or .80% from prior
year. Sales tax revenue increased by $136,443 or 2.17% from prior year. Charges for
Services revenue increased by $356,064 or 8.83% from prior year. State income tax
revenue increased by $10,785 or .49% from prior year. Miscellaneous taxes revenue
(local use, real estate transfer, hotel & motel tax, food & beverage, gasoline tax and
others) increased by $56,272 or 3.12% from prior year. Telecommunication decreased by
$102,839 or 11.63% from prior year. A utility tax (Electric & Natural gas tax) increased
by $62,782 or 5.38% from prior year
(This space intentionally left blank)
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 9
The following table graphically depicts the major revenue sources of the Village.
Prior Year Revenue by Source – Governmental Activities – For Comparison
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 10
Expenses
For the year ended December 31, 2014, expenses for governmental activities were $30,651,969
at December 31, 2014 and $31,659,175 at December 31, 2013, a decrease of $1,007,206, or
3.18%. The key change during the year for the governmental activity expenses is described
below:
This decrease is due to the Village management’s approach to closely supervising
expenses in response to projected decreases in several revenue sources. Village wide cost
cutting initiatives include a hiring freeze and lower spending in the categories of
contractual services and commodities.
The ‘Expense and Program Revenues’ table identifies those governmental functions where
program expenses exceed revenues. These deficits are expected as those governmental functions
are primarily support by General Revenues (for instance Property Taxes and Sales Taxes) rather
than the Program Revenues.
BUSINESS-TYPE ACTIVITIES
Business-Type activities posted total revenues of $11,026,631, while the costs of all business-
type activities totaled $9,225,434. This results in a surplus of $1,801,197 prior to net capital
grant of $59,473. In 2013, revenues of $10,220,534 exceed expenses of $8,651,380, resulting in
a surplus of $1,569,154 prior to net contribution of $59,024.
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 11
Revenues
The Village of Morton Grove purchases its water from the City of Chicago. In 2011, the City of
Chicago announced a series of rate increases over a 4 year period equal to 70%. Per Village
municipal code 7-4-5:
7-4-5-A4: whenever the City of Chicago, Illinois, increases its rates or charges for the
water sold to the Village of Morton Grove by an amount equal to or more than one
percent (1%) of its current rate or charges, the rates to be charged by the village of
Morton Grove to its customers for water shall be automatically increased by a like
percentage. Said rate increase shall become effective upon the effective date of any rate
increase by the city of Chicago.
7-4-5-A5: Additional Rate Increases: Beginning January 1, 2012, in addition to the rate
increases set forth in subsection A4 of this section, water rates will increase by an
additional three percent (3%) per year for the years 2012, 2013, 2014 and 2015
In 2014 the Village water rate increased by 18% resulting in the current water rate charge of
$10.81 per 1,000 Gallon. Water and Sewer Fund operating revenues increased by $820,810 or
10.45%, due to rate increases.
The Village created the Solid Waste Fund to account for the financial activity of the Village
residential waste collection and disposal program. In May 2010 the Village’s staff assumed
responsibility for billing and residents are charged for waste removal and disposal as part of their
bi-monthly water bill. In 2014 Solid Waste operating revenues increased by $27,151 or 1.39%.
The Village created the Municipal Parking Fund to account for the Village parking lots and
monies received from permit sales. The Village staff are responsible for customers who signed a
yearly, quarterly or monthly lease for parking spaces near the Metra Station in Morton Grove.
Operating revenues for 2014 increased by $5,542 or 10.25%. The Parking lot opened January
2011with 112 spaces available.
Expenses
Total expenses for water and sewer fund activities totaled $7,356,131, an increase of $585,612,
or 8.65% from prior year as a result of an increase in cost of water purchases and other
commodities.
Total expenses for solid waste fund activities totaled $1,857,923, a decrease of $11,217, or .60%
from prior year as a result of lower Leaf collection pickup per tons charges.
Total expenses from Municipal Parking Fund activities totaled $11,380, a decrease of $341 or
2.91% from prior year no major project on the Village Municipal parking lot.
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 12
FINANCIAL ANALYSIS OF THE GOVERNMENT’S FUND
As noted earlier, the Village uses fund accounting to ensure and demonstrate compliance with
finance-related legal requirements.
GOVERNMENTAL FUNDS
The focus of the Village’s governmental funds is to provide information on the near-term
inflows, outflows, and balances of spendable resources. Such information is useful in assessing
the Village’s financing requirement. In particular, unassigned fund balance may serve as a
useful measure of a government’s net resources available for spending at the end of the fiscal
year.
The Village’s governmental funds reported combining ending fund balances of $21,942,159,
which is $1,013,920, or 4.84% higher than last year’s total of $20,928,239. Of this $21,942,159
total, $3,839,869 or approximately 17.50% of the fund balance constitutes unassigned fund
balance.
General Fund: The General Fund reported a surplus for the year of $584,220. Revenue exceeds
budgeted amount due to issuance of 2014 Bond Series for $1.415M. Without the proceeds,
revenues under budget by $532,952. The increase in expenditures were related to personnel costs
and capital outlay purchases.
The General Fund is the chief operating fund of the Village. At December 31, 2014, unassigned
fund balance in the General Fund was $5,745,220, which represents 73.19% of the total fund
balance of the General Fund. As a measure of the General Fund’s liquidity, it is useful to
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 13
compare unassigned fund balance to total expenditures. Unassigned fund balance in General
Fund represents approximately 22.68% of total General Fund expenditures.
Lehigh Ferris TIF Fund: Reported a fund balance increase of $778,749 due to incremental
property tax revenue exceeding the expenditures for 2014.
Waukegan Road TIF Fund: Reported a fund balance declined of $317,620 as a result of debt
service costs exceeding the incremental property tax revenue.
Debt Service Fund: Reported a fund balance increase of $132,288 as a result of 2013 budget
plan to increase the home rule sales tax allocation to pay the debt service costs which exceeded
the property tax revenue allocated.
Capital Projects Fund: Reported a fund balance decrease of $324,909 primarily as a result
of various Capital Project Programs implemented in 2014.
PROPRIETARY FUNDS
The Village’s proprietary funds provide the same type of information found in the government -
wide financial statements, but in more detail.
The Village reports the Water and Sewer Fund a major proprietary fund. The Village reports two
non-major proprietary funds, the Solid Waste Fund and the Municipal Parking Fund. The Water
and Sewer Fund accounts for all of the operations of the municipal water system. Water is
purchased from the City of Chicago at a rate of $3.32 per thousand gallons a 15.00% increase
from 2013. Water is then sold to all residential municipal customers at a rate of $10.81 which
covers both water and sewer. Rates for commercial customers vary based on the gallons of water
consumed. The spread between the purchase and sales rates is intended to finance the operations
of the water system, including labor costs, supplies, repair and replacement and required
infrastructure maintenance.
CAPITAL ASSETS
The Village’s investment in net capital assets for its governmental and business type activities as
of December 31, 2014 was $66,877,097 (net of accumulated depreciation). This investment in
capital assets includes land (right of way), buildings, improvements, machinery & equipment,
and infrastructure. The minimum capital threshold remained at $10,000. For more information
regarding the Village’s capital assets, please refer to Note 4 of this CAFR.
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 14
Debt Administration
In 2012 Standard and Poor classified the Village’s credit profile as ‘AA/Stable’ and therefore
assigned its ‘AA’ long-term rating to the Village. This rating reflects favorably upon the
Village’s management practices as the Village was rated AA3 by Moody’s Investor services in
2009. As the Village is a home rule community, there is no legal limit for outstanding debt.
Additional information on the Village’s long-term debt can be found in Note 6 on page 34-42 of
this report.
Long-Term Debt
At year-end, the Village had total outstanding debt of $20,833,626, as compared to
$22,864,121 the previous year, a decrease of $2,030,495, or 9.75% which coupled with
principal retirements that reduced the outstanding liability on the bonds.
The following is a comparative statement of outstanding debt (excluding intergovernmental
agreements).
12/31/14 12/31/13 12/31/14 12/31/13 12/31/14 12/31/13
Construction in Progress -$ -$ 21$ -$ 21$ -$
Right of Ways 43,972 43,972 - - 43,972 43,972
Infrastructure 6,008 6,547 - - 6,008 6,547
Buildings and Improvements 5,688 6,276 8,555 7,042 14,243 13,318
Machinery, Equipment and Vehicles 1,762 1,277 872 969 2,634 2,246
57,430$ 58,072$ 9,448$ 8,011$ 66,878$ 66,083$
Capital Assets - Net of Depreciation (in thousands)
Governmental Business-Type
Total
Activities Activities Total
Type of Debt
12/31/14 12/31/13 12/31/14 12/31/13 12/31/14 12/31/13
General Obligation Bonds 15,488$ 16,549$ 3,577$ 4,176$ 19,065$ 20,725$
Revolving loans - - - - - -
Installment Notes 1,769 2,139 - - 1,769 2,139
17,257$ 18,688$ 3,577$ 4,176$ 20,834$ 22,864$ Total Long Term Debt
Long Term Debt (in thousands)
Governmental
Activities
Business-Type
Activities Total
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 15
Economic Factors and Future Prospects
The soft economy and showing little revenues remain the Village’s biggest challenge. The
Village Board continues to be sensitive to the unknown financial circumstances of residents
and businesses by reducing its operating expenditures and limiting tax increases. Some
challenges that were considered during the development of 2015 budget;
Instability of the National and local economy: Weak financial markets continue to
dictate low interest rates on investments. Real estate remained very slow particularly for
Cook County with the .17% foreclosure compared to .13% Illinois and .08% National.
Housing foreclosures, declining tax bases, and reduced state pass-through revenues have
negatively impacted the fiscal condition of the local economy.
Pension liabilities: Recent changes in pension legislation allowed the municipalities
some relief in funding the pension obligation at 90% b y 2040. The Village continues to
fund the pension based on actuarial results from the Department of Insurance report or
the independent actuary the Village and Pensions hired. Additionally, the Village
adjusted its actuarial rate for Police and Fire pension return on investment from 7.25% in
2012 to 7.125% in 2013 and 2014.
Total operating revenues budgeted for 2015 are $53,899,809 (excluding transfers), a .02%
decrease from the 2014 budget, mostly due to declining property value (EAV). The General
fund revenues are budgeted at $26,264,068 (excluding transfers), a 1,047,901, or 4.16%
increase from 2014 due to a projected slight increase from state shared sales, income and
utility taxes. The Village’s total 2014 property tax levy payable in 2015 is $9,881,472, a 2%
(two) increase over the prior year’s tax levy.
Total Village spending for the 2015 budget is $62,353,471 (excluding transfers), a 6.34%
increase from the 2014 budget. The majority of the increase distributed fairly evenly
throughout contractual, commodities, and other capital spending with personnel costs being
slightly ahead of the other categories due to pension contributions and contractually obligated
pay increases.
Requests for Information
This financial report is designed to provide a general overview of the Village’s finances for
all those with an interest in the Village’s operations. Questions concerning any of the
information provided in this report or request for additional financial information should be
addressed to the Office of the Finance Director, Village of Morton Grove, 6101 Capulina,
Morton Grove, Illinois, 60053.
Governmental Business-Type
Activities Activities Total
ASSETS
Cash and cash equivalents 4,363,209$ 3,677,999$ 8,041,208$
Investments 3,007,365 498,800 3,506,165
Receivables (net, where applicable,
of allowances for uncollectibles)
Property taxes 10,245,060 - 10,245,060
Sales tax 1,707,549 - 1,707,549
State income tax 260,665 - 260,665
Accounts and allotments 1,039,457 1,106,583 2,146,040
Loan to developer 1,700,000 - 1,700,000
IRMA excess surplus 848,115 - 848,115
IPBC terminal reserve 533,663 - 533,663
Prepaid expenses 589,507 40,464 629,971
Land held for resale 9,572,376 - 9,572,376
Capital assets not being depreciated 43,972,244 20,608 43,992,852
Capital assets (net of
accumulated depreciation)13,457,370 9,426,875 22,884,245
Total assets 91,296,580 14,771,329 106,067,909
DEFERRED OUTFLOWS OF RESOURCES
Unamortized loss on refunding 43,493 - 43,493
Total deferred outflows of resources 43,493 - 43,493
Total assets and deferred outflows
of resources 91,340,073 14,771,329 106,111,402
Primary Government
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF NET POSITION
December 31, 2014
(This statement is continued on the following page.)
- 4 -
Governmental Business-Type
Activities Activities Total
LIABILITIES
Accounts payable 641,280$ 1,029,402$ 1,670,682$
Accrued salaries and wages 415,707 40,021 455,728
Other payables 70,869 - 70,869
Accrued interest payable 67,068 7,634 74,702
Deposits - refundable 294,299 - 294,299
Unearned revenue 364,604 57,760 422,364
Due to fiduciary funds 2,266 - 2,266
Noncurrent liabilities
Due within one year 2,101,548 190,743 2,292,291
Due in more than one year 40,511,827 3,804,416 44,316,243
Total liabilities 44,469,468 5,129,976 49,599,444
DEFERRED INFLOWS OF RESOURCES
Unearned revenue - property taxes 10,135,782 - 10,135,782
Total deferred inflows of resources 10,135,782 - 10,135,782
Total liabilities and deferred inflows
of resources 54,605,250 5,129,976 59,735,226
NET POSITION
Net investment in capital assets 44,444,400 5,875,794 50,320,194
Restricted for
Public safety 805,492 - 805,492
Community development 14,228,109 - 14,228,109
Highways and streets 860,194 - 860,194
Unrestricted (23,603,372) 3,765,559 (19,837,813)
TOTAL NET POSITION 36,734,823$ 9,641,353$ 46,376,176$
STATEMENT OF NET POSITION (Continued)
December 31, 2014
Primary Government
VILLAGE OF MORTON GROVE, ILLINOIS
See accompanying notes to financial statements.
- 5 -
Operating Capital
Charges Grants and Grants and
FUNCTIONS/PROGRAMS Expenses for Services Contributions Contributions
PRIMARY GOVERNMENT
Governmental Activities
General government 3,749,953$ 3,426,448$ -$ -$
Public safety 19,225,281 961,296 151,742 -
Streets and sidewalks 4,043,649 1,558 677,309 158,042
Vehicle maintenance 793,103 - - -
Health and human services 282,897 845 - -
Community development 980,882 - - -
Building and inspectional services 794,883 - - -
Interest 781,321 - - -
Total governmental activities 30,651,969 4,390,147 829,051 158,042
Business-Type Activities
Water and sewer 7,356,131 8,678,471 - 59,473
Solid waste 1,857,923 1,983,404 - -
Municipal parking 11,380 59,633 - -
Total business-type activities 9,225,434 10,721,508 - 59,473
TOTAL PRIMARY GOVERNMENT 39,877,403$ 15,111,655$ 829,051$ 217,515$
Program Revenues
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF ACTIVITIES
For the Year Ended December 31, 2014
- 6 -
Governmental Business-Type
Activities Activities Total
(323,505)$ -$ (323,505)$
(18,112,243) - (18,112,243)
(3,206,740) - (3,206,740)
(793,103) - (793,103)
(282,052) - (282,052)
(980,882) - (980,882)
(794,883) - (794,883)
(781,321) - (781,321)
(25,274,729) - (25,274,729)
- 1,381,813 1,381,813
- 125,481 125,481
- 48,253 48,253
- 1,555,547 1,555,547
(25,274,729) 1,555,547 (23,719,182)
General Revenues
Taxes
Property 12,444,336 - 12,444,336
Sales 6,413,855 - 6,413,855
Utility 1,228,883 - 1,228,883
Telecommunications 781,166 - 781,166
Real estate transfer 343,209 - 343,209
Hotel/motel 76,008 - 76,008
Food and beverage 413,467 - 413,467
Gasoline 246,038 - 246,038
Other 326,791 - 326,791
Intergovernmental
Income 2,227,959 - 2,227,959
Local use 454,615 - 454,615
Personal property replacement 398,843 - 398,843
Investment income 15,843 2,966 18,809
Gain on sale of capital assets - 17,500 17,500
Miscellaneous 363,420 284,657 648,077
Total 25,734,433 305,123 26,039,556
CHANGE IN NET POSITION 459,704 1,860,670 2,320,374
NET POSITION, JANUARY 1 36,275,119 7,780,683 44,055,802
NET POSITION, DECEMBER 31 36,734,823$ 9,641,353$ 46,376,176$
Primary Government
Net (Expense) Revenue and Change in Net Position
See accompanying notes to financial statements.
- 7 -
Lehigh/Ferris Waukegan Debt Capital
General TIF Road TIF Service Projects Nonmajor Total
Cash and cash equivalents 26,763$ 1,649,710$ -$ 155,585$ 804,119$ 1,727,032$ 4,363,209$
Investments 1,496,100 1,246,829 - 169,375 - 95,061 3,007,365
Receivables
Property taxes 9,613,885 43,908 1,059 483,395 102,813 - 10,245,060
Sales tax 1,426,051 - - 137,500 6,250 137,748 1,707,549
State income tax 260,665 - - - - - 260,665
Accounts and allotments 900,592 17,000 - - - 121,865 1,039,457
Due from other funds 1,768,544 - - - - - 1,768,544
Prepaids 589,507 - - - - - 589,507
Loan to developer - 1,700,000 - - - - 1,700,000
Advances to other funds 1,514,751 44,364 - - - - 1,559,115
IRMA excess surplus 848,115 - - - - - 848,115
IPBC terminal reserve 533,663 - - - - - 533,663
Land held for resale - 9,572,376 - - - - 9,572,376
TOTAL ASSETS 18,978,636$ 14,274,187$ 1,059$ 945,855$ 913,182$ 2,081,706$ 37,194,625$
ASSETS
VILLAGE OF MORTON GROVE, ILLINOIS
BALANCE SHEET
GOVERNMENTAL FUNDS
December 31, 2014
- 8 -
Lehigh/Ferris Waukegan Debt Capital
General TIF Road TIF Service Projects Nonmajor Total
LIABILITIES
Accounts payable and retainage payable 520,502$ 1,714$ -$ -$ 10,926$ 108,138$ 641,280$
Accrued salaries and wages 415,707 - - - - - 415,707
Other payables 70,869 - - - - - 70,869
Unearned revenue 269,231 - - - 46,624 48,749 364,604
Deposits - refundable 294,299 - - - - - 294,299
Due to other funds - - 696,521 422,003 - 650,020 1,768,544
Due to fiduciary funds 2,266 - - - - - 2,266
Advances from other funds - - 1,388,930 - - 170,185 1,559,115
Total liabilities 1,572,874 1,714 2,085,451 422,003 57,550 977,092 5,116,684
DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - property taxes 9,556,284 - - 477,013 102,485 - 10,135,782
Total deferred inflows of resources 9,556,284 - - 477,013 102,485 - 10,135,782
Total liabilities and deferred inflows of resources 11,129,158 1,714 2,085,451 899,016 160,035 977,092 15,252,466
FUND BALANCES (DEFICIT)
Nonspendable
Advance to other funds 1,514,751 44,364 - - - - 1,559,115
Prepaids 589,507 - - - - - 589,507
Restricted for
Public safety - - - - - 805,492 805,492
Capital improvements - unspent bond proceeds - - - - 18 - 18
Community development - 14,228,109 - - - - 14,228,109
Highways and streets - - - - - 860,194 860,194
Committed for commuter improvements - - - - - 59,855 59,855
Unassigned (deficit)5,745,220 - (2,084,392) 46,839 753,129 (620,927) 3,839,869
Total fund balances (deficit)7,849,478 14,272,473 (2,084,392) 46,839 753,147 1,104,614 21,942,159
TOTAL LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCES 18,978,636$ 14,274,187$ 1,059$ 945,855$ 913,182$ 2,081,706$ 37,194,625$
OF RESOURCES AND FUND BALANCES
LIABILITIES, DEFERRED INFLOWS
See accompanying notes to financial statements.
- 9 -
FUND BALANCES OF GOVERNMENTAL FUNDS 21,942,159$
Amounts reported for governmental activities in the
statement of net position are different because:
Capital assets used in governmental activities are
not financial resources and, therefore, are not
reported in the governmental funds 57,429,614
Interest payable is not due and payable in the current period
and, therefore, not reported in the governmental funds (67,068)
Long-term liabilities are not due and payable in the current
period and, therefore, are not reported in the governmental funds
General obligation bonds payable (15,487,800)
Installment notes payable (1,768,626)
Intergovernmental agreement payable (2,785,393)
Net pension obligation (17,903,661)
Net other postemployment benefits obligation (4,028,235)
Compensated absences (587,361)
The unamortized bond premium is not a current financial
resource and, therefore, is not reported in the
governmental funds (57,511)
The unamortized bond discount is not a current financial
resource and, therefore, is not reported in the
governmental funds 5,212
The unamortized loss on bond refunding is shown as a deferred outflow
on the statement of net position 43,493
NET POSITION OF GOVERNMENTAL ACTIVITIES 36,734,823$
VILLAGE OF MORTON GROVE, ILLINOIS
RECONCILIATION OF FUND BALANCES OF GOVERNMENTAL FUNDS TO THE
GOVERNMENTAL ACTIVITIES IN THE STATEMENT OF NET POSITION
December 31, 2014
See accompanying notes to financial statements.
- 10 -
Lehigh/Ferris Waukegan
General TIF Road TIF
REVENUES
Taxes 17,485,841$ 2,077,952$ 544,608$
Licenses and permits 1,741,148 - -
Intergovernmental 3,223,029 - -
Surcharges - - -
Charges for services 814,935 - -
Fines 827,515 - -
Investment income 9,018 3,029 24
Cable TV franchise fees 340,991 - -
Miscellaneous 258,667 17,000 -
Total revenues 24,701,144 2,097,981 544,632
EXPENDITURES
Current
General government 2,845,513 - -
Public safety 17,397,217 - -
Streets and sidewalks 3,028,264 - -
Vehicle maintenance 793,103 - -
Health and human services 282,897 - -
Community development 189,709 254,107 1,346
Building and inspectional services 790,256 - -
Debt service
Principal retirement - 510,000 702,912
Interest and fiscal charges - 287,403 157,947
Capital outlay
Capital projects - 2,522 47
Total expenditures 25,326,959 1,054,032 862,252
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (625,815) 1,043,949 (317,620)
OTHER FINANCING SOURCES (USES)
Transfers in 265,200 - -
Transfers (out)(492,263) (265,200) -
Issuance of general obligation bonds 1,415,000 - -
Proceeds from sale of capital assets 22,098 - -
Total other financing sources (uses)1,210,035 (265,200) -
NET CHANGE IN FUND BALANCES 584,220 778,749 (317,620)
FUND BALANCES (DEFICIT), JANUARY 1 7,265,258 13,493,724 (1,766,772)
FUND BALANCES (DEFICIT), DECEMBER 31 7,849,478$ 14,272,473$ (2,084,392)$
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
For the Year Ended December 31, 2014
- 11 -
Debt Capital
Service Projects Nonmajor Total
1,535,364$ 75,634$ 554,355$ 22,273,754$
- - - 1,741,148
75,693 35,282 916,149 4,250,153
- - 246,727 246,727
- - 324,940 1,139,875
- - - 827,515
880 1,311 1,581 15,843
- - - 340,991
- - - 275,667
1,611,937 112,227 2,043,752 31,111,673
- 124,145 - 2,969,658
- - 307,951 17,705,168
- - 704,175 3,732,439
- - - 793,103
- - - 282,897
- - 877,444 1,322,606
- - - 790,256
1,634,083 - - 2,846,995
337,829 - - 783,179
- 312,991 - 315,560
1,971,912 437,136 1,889,570 31,541,861
(359,975) (324,909) 154,182 (430,188)
492,263 - - 757,463
- - - (757,463)
- - - 1,415,000
- - 7,010 29,108
492,263 - 7,010 1,444,108
132,288 (324,909) 161,192 1,013,920
(85,449) 1,078,056 943,422 20,928,239
46,839$ 753,147$ 1,104,614$ 21,942,159$
See accompanying notes to financial statements.
- 12 -
NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FUNDS 1,013,920$
Amounts reported for governmental activities in the statement of activities
are different because:
Governmental funds report capital outlay as expenditures; however, they are
capitalized and depreciated in the statement of activities 876,383
Depreciation expense does not require the use of current financial statement resources
and, therefore, is not reported as in expenditure in the governmental funds (1,518,387)
Governmental funds do not report compensated absences; however, they are
recognized as a reduction to expenses on the statement of activities 22,539
The issuance of long-term debt (general obligation bonds) is reported as an other financing source
in governmental funds but as an increase of principal outstanding in the statement of activities (1,415,000)
The repayment of the principal portion of general obligation bonds payable, revolving notes
payable and installment notes payable are reported as debt service expenditures when
due in governmental funds but as a reduction of principal outstanding in the statement
of activities 2,846,995
The repayment of the principal portion of the intergovernmental agreement payable
is reported as an expenditure when due in governmental funds but as a reduction of
principal outstanding in the statement of activities 349,557
The amortization of the refunding loss is not reported in governmental funds,
but is reported in the statement of activities (12,425)
The amortization of the bond premium is not reported in governmental funds,
but is reported in the statement of activities 6,450
The amortization of the bond discount is not reported in governmental funds,
but is reported in the statement of activities (1,987)
The change in net pension obligation and asset is not reported in governmental
funds, but is reported in the statement of activities (1,110,641)
The change in net other postemployment benefits obligations are reported
only in the statement of activities (607,520)
The change in the accrued interest payable on long-term debt is reported
as interest expense on the statement of activities 9,820
CHANGES IN NET POSITION OF GOVERNMENTAL ACTIVITIES 459,704$
For the Year Ended December 31, 2014
VILLAGE OF MORTON GROVE, ILLINOIS
RECONCILIATION OF GOVERNMENTAL FUNDS STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES TO THE
GOVERNMENTAL ACTIVITIES IN THE STATEMENT OF ACTIVITIES
See accompanying notes to financial statements.
- 13 -
Water
and Sewer Nonmajor Total
CURRENT ASSETS
Cash and cash equivalents 3,246,283$ 431,716$ 3,677,999$
Investments 498,800 - 498,800
Receivables 1,026,030 80,553 1,106,583
Prepaid expenses - 40,464 40,464
Total current assets 4,771,113 552,733 5,323,846
NONCURRENT ASSETS
Capital assets - not being depreciated 20,608 - 20,608
Capital assets - net of accumulated depreciation 9,426,875 - 9,426,875
Total noncurrent assets 9,447,483 - 9,447,483
Total assets 14,218,596 552,733 14,771,329
DEFERRED OUTFLOWS OF RESOURCES
None - - -
Total deferred outflows of resources - - -
Total assets and deferred outflows of resources 14,218,596 552,733 14,771,329
CURRENT LIABILITIES
Accounts payable 833,105 196,297 1,029,402
Accrued salaries and wages 40,021 - 40,021
Accrued interest payable 7,634 - 7,634
Unearned revenue - 57,760 57,760
Compensated absences - current maturities 8,143 - 8,143
Bonds payable - current maturities 182,600 - 182,600
Total current liabilities 1,071,503 254,057 1,325,560
LONG-TERM LIABILITIES
Compensated absences 73,287 - 73,287
Bonds payable, net of discount 3,389,109 - 3,389,109
Net other postemployment benefit obligation 342,020 - 342,020
Total long-term liabilities 3,804,416 - 3,804,416
Total liabilities 4,875,919 254,057 5,129,976
DEFERRED INFLOWS OF RESOURCES
None - - -
Total deferred inflows of resources - - -
Total liabilities and deferred inflows of resources 4,875,919 254,057 5,129,976
NET POSITION
Net investment in capital assets 5,875,794 - 5,875,794
Unrestricted 3,466,883 298,676 3,765,559
TOTAL NET POSITION 9,342,677$ 298,676$ 9,641,353$
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
December 31, 2014
See accompanying notes to financial statements.
- 14 -
Water and
Sewer Nonmajor Total
OPERATING REVENUES
Water sales 7,879,756$ -$ 7,879,756$
Sewer charges 783,173 - 783,173
Waste charges - 1,983,404 1,983,404
Meter and connection fees 15,542 - 15,542
Parking charges - 59,633 59,633
Miscellaneous 111,114 - 111,114
Total operating revenues 8,789,585 2,043,037 10,832,622
OPERATING EXPENSES
Personal services 1,828,662 - 1,828,662
Contractual services and other charges 768,884 1,858,936 2,627,820
Water purchases 3,616,594 - 3,616,594
Capital outlay 30,366 - 30,366
Commodities 308,732 367 309,099
Administrative fees 139,500 10,000 149,500
Utilities 80,806 - 80,806
Total operating expenses 6,773,544 1,869,303 8,642,847
OPERATING INCOME BEFORE DEPRECIATION 2,016,041 173,734 2,189,775
Depreciation 375,859 - 375,859
OPERATING INCOME 1,640,182 173,734 1,813,916
NON-OPERATING REVENUES (EXPENSES)
Rental income 173,543 - 173,543
Investment income 2,237 729 2,966
Gain on sale of capital assets 17,500 - 17,500
Interest expense and fiscal agent fees (206,728) - (206,728)
Total non-operating revenues (expenses)(13,448) 729 (12,719)
NET INCOME BEFORE CAPITAL GRANTS 1,626,734 174,463 1,801,197
CAPITAL GRANTS 59,473 - 59,473
CHANGE IN NET POSITION 1,686,207 174,463 1,860,670
NET POSITION, JANUARY 1 7,656,470 124,213 7,780,683
NET POSITION, DECEMBER 31 9,342,677$ 298,676$ 9,641,353$
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN NET POSITION
PROPRIETARY FUNDS
For the Year Ended December 31, 2014
See accompanying notes to financial statements.
- 15 -
Water and
Sewer Nonmajor Total
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers and users 8,605,374$ 2,037,308$ 10,642,682$
Receipts from miscellaneous revenues 111,114 - 111,114
Payments to suppliers (4,599,133) (1,888,780) (6,487,913)
Payments to employees (1,723,877) - (1,723,877)
Payments to other funds (139,500) - (139,500)
Net cash from operating activities 2,253,978 148,528 2,402,506
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
Rental receipts 173,543 - 173,543
Net cash from noncapital
financing activities 173,543 - 173,543
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES
Intergovernmental 59,473 - 59,473
Purchase of capital assets (1,812,307) - (1,812,307)
Proceeds from sale of capital assets 17,500 - 17,500
Bond principal payments (598,500) - (598,500)
Interest payments (209,391) - (209,391)
Net cash from capital and
related financing activities (2,543,225) - (2,543,225)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest received 2,237 729 2,966
Purchase of investment (498,800) - (498,800)
Net cash from investing activities (496,563) 729 (495,834)
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (612,267) 149,257 (463,010)
CASH AND CASH EQUIVALENTS, JANUARY 1 3,858,550 282,459 4,141,009
CASH AND CASH EQUIVALENTS, DECEMBER 31 3,246,283$ 431,716$ 3,677,999$
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
For the Year Ended December 31, 2014
(This statement is continued on the following page.)
- 16 -
Water and
Sewer Nonmajor Total
RECONCILIATION OF OPERATING INCOME TO NET
CASH FLOWS FROM OPERATING ACTIVITIES
Operating income 1,640,182$ 173,734$ 1,813,916$
Adjustments to reconcile operating income to net
cash from operating activities
Depreciation 375,859 - 375,859
Changes in operating assets and liabilities
Receivables (67,601) (15,369) (82,970)
Prepaid expenses - (3,994) (3,994)
Refundable deposits (5,496) - (5,496)
Accounts payable 206,249 (15,483) 190,766
Accrued salaries and wages 1,356 - 1,356
Compensated absences 36,970 - 36,970
Other postemployment benefit obligation 66,459 - 66,459
Unearned revenues - 9,640 9,640
NET CASH FROM OPERATING ACTIVITIES 2,253,978$ 148,528$ 2,402,506$
SCHEDULE OF NONCASH TRANSACTIONS
None -$ -$ -$
PROPRIETARY FUNDS
For the Year Ended December 31, 2014
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF CASH FLOWS (Continued)
See accompanying notes to financial statements.
- 17 -
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF FIDUCIARY NET POSITION
PENSION TRUST FUNDS
December 31, 2014
Cash and cash equivalents 1,150,172$
Investments, at fair value
Equitites 31,147,484
Equity mutual funds 699,016
Corporate bonds 6,923,836
Annuity contracts 9,922,658
U.S. Treasury obligations 6,455,613
U.S. agency obligations 15,043,480
Municipal bonds 574,545
Receivables
Accrued interest 178,579
Other 17,149
Due from primary government 2,266
Prepaid expenses 6,263
Total assets 72,121,061
LIABILITIES
Accounts payable 71,663
Total liabilities 71,663
NET POSITION HELD IN TRUST FOR
PENSION BENEFITS 72,049,398$
ASSETS
See accompanying notes to financial statements.
- 18 -
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
PENSION TRUST FUNDS
For the Year Ended December 31, 2014
ADDITIONS
Contributions
Employer 4,455,737$
Employee 818,986
Total contributions 5,274,723
Investment income
Net appreciation in fair value
of investments 2,633,283
Interest 1,479,183
Total investment income 4,112,466
Less investment expense (164,193)
Net investment income 3,948,273
Total additions 9,222,996
DEDUCTIONS
Retirement benefits 5,132,732
Duty/nonduty disability benefits 681,243
Surviving spouse benefits 552,711
Refunds 208,308
Administrative expenses 90,119
Total deductions 6,665,113
NET INCREASE 2,557,883
NET POSITION HELD IN TRUST
FOR PENSION BENEFITS
January 1 69,491,515
December 31 72,049,398$
See accompanying notes to financial statements.
- 19 -
- 20 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS
December 31, 2014
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Village of Morton Grove, Illinois (the Village) have been
prepared in conformity with accounting principles generally accepted in the United States
of America (hereinafter referred to as generally accepted accounting principles (GAAP)),
as applied to government units. The Governmental Accounting Standards Board (GASB) is
the accepted standard-setting body for establishing governmental accounting and financial
reporting principles. The more significant of the Village’s accounting policies are
described below.
a. Reporting Entity
The Village is a municipal corporation governed by an elected president and a
six-member board of trustees. As required by generally accepted accounting
principles, these financial statements present the Village (the primary government)
and its component units.
Based on the criteria of GASB Statement No 61, The Financial Reporting Entity:
Omnibus – an amendment of GASB Statements No. 14 and No. 34, there are no
component units for which the Village is considered to be financially accountable
for.
The Village’s financial statements include pension trust funds.
Municipal Employees’ Retirement Fund (MERF)
The Village’s municipal employees participate in the Municipal Employees’
Retirement Fund (MERF). MERF functions for the benefit of these employees and is
governed by the Village Board of Trustees. The Village and MERF participants are
obligated to fund all MERF costs based upon actuarial valuations. The Village is
authorized to approve the actuarial assumptions used in the determination of
contribution levels. Although it possesses many of the characteristics of a legally
separate government, MERF is reported as if it were part of the primary government
because its sole purpose is to finance and administer the pensions of the Village’s
municipal employees that are not members of the Police Pension Employees
Retirement System or the Firefighters’ Pension Employees Retirement System and
because of the fiduciary nature of such activities. MERF is reported as a pension trust
fund.
- 20 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 21 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
a. Reporting Entity (Continued)
Police Pension Employees Retirement System (PPERS)
The Village’s police employees participate in the Police Pension Employees
Retirement System (PPERS). PPERS functions for the benefit of these employees
and is governed by a five-member pension board. Two members appointed by the
Village’s President, one elected pension beneficiary and two elected police
employees constitute the pension board. The Village and PPERS participants are
obligated to fund all PPERS costs based upon actuarial valuations. The State of
Illinois is authorized to establish benefit levels and the Village is authorized to
approve the actuarial assumptions used in the determination of contribution levels.
Although it possesses many of the characteristics of a legally separate government,
PPERS is reported as if it were part of the primary government because its sole
purpose is to finance and administer the pensions of the Village’s police employees,
and because of the fiduciary nature of such activities. PPERS is reported as a pension
trust fund.
Firefighters’ Pension Employees Retirement System (FPERS)
The Village’s firefighters participate in the Firefighters’ Pension Employees
Retirement System (FPERS). FPERS functions for the benefit of these employees
and is governed by a five-member pension board. Two members appointed by the
Village’s President, one elected pension beneficiary and two elected fire employees
constitute the pension board. The Village and FPERS participants are obligated to
fund all FPERS costs based upon actuarial valuations. The State of Illinois is
authorized to establish benefit levels and the Village is authorized to approve the
actuarial assumptions used in the determination of contribution levels. Although it
possesses many of the characteristics of a legally separate government, FPERS is
reported as if it were part of the primary government because its sole purpose is to
finance and administer the pensions of the Village’s firefighters, and because of the
fiduciary nature of such activities. FPERS is reported as a pension trust fund.
b. Fund Accounting
The Village uses funds to report on its financial position, changes in its financial
position and cash flows. Fund accounting is designed to demonstrate legal
compliance and to aid financial management by segregating transactions related to
certain government functions or activities.
A fund is a separate accounting entity with a self-balancing set of accounts.
Funds are classified into the following categories: governmental, proprietary and
fiduciary.
- 21 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 22 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
b. Fund Accounting (Continued)
Governmental funds are used to account for all or most of a government’s general
activities, including the collection and disbursement of restricted, committed or
assigned monies (special revenue funds), the funds restricted, committed or assigned
for the acquisition or construction of capital assets (capital projects funds) and the
funds restricted, committed or assigned for servicing of governmental long-term debt
(debt service funds).
Proprietary funds are used to account for activities similar to those found in the
private sector, where the determination of net income is necessary or useful to sound
financial administration. Goods or services from such activities can be provided
either to outside parties (enterprise funds) or to other departments or agencies
primarily within the Village (internal service funds).
Fiduciary funds are used to account for assets held on behalf of outside parties,
including other governments, or on behalf of other funds within the Village.
c. Government-Wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net position and the
statement of activities) report information on all of the nonfiduciary activities of the
Village. The effect of material interfund activity has been eliminated from these
statements. Interfund services provided and used between funds has not been
eliminated in the process of consolidation. Governmental activities which normally
are supported by taxes and intergovernmental revenues are reported separately from
business-type activities, which rely to a significant extent on fees and charges for
support.
The statement of activities demonstrates the degree to which the direct expenses of a
given function, segment or program are offset by program revenues. Direct expenses
are those that are clearly identifiable with a specific function or segment. Program
revenues include (1) charges to customers or applicants who purchase, use or directly
benefit from goods, services or privileges provided by a given function and (2) grants
and shared revenues that are restricted to meeting the operational or capital
requirements of a particular function. Taxes and other items are not properly
included among program revenues but are reported instead as general revenues.
Separate financial statements are provided for governmental funds. Major individual
governmental funds are reported as separate columns in the fund financial
statements.
- 22 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 23 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
c. Government-Wide and Fund Financial Statements (Continued)
The Village reports the following major governmental funds:
The General Fund is the Village’s primary operating fund. It accounts for all
financial resources of the Village, except those accounted for in another fund.
Lehigh/Ferris Tax Increment Financing Fund accounts for tax increment
revenue and other financial resources received along with the costs related to
the Village’s Tax Increment Financing (TIF) District. The fund entails the TIF
District along Lehigh and Ferris Avenues. The TIF District is authorized by
state law and is created to promote redevelopment of certain parcels declared
as “blighted” into a higher and more productive land use.
The Waukegan Road Tax Increment Financing Fund accounts for tax
increment revenue and other financial resources received along with the costs
related to the Village’s Tax Increment Financing (TIF) District. The fund
entails the TIF District along Waukegan Road. The TIF District is authorized
by state law and is created to promote redevelopment of certain parcels
declared as “blighted” into a higher and more productive land use.
The Debt Service Fund is used to account for the payment of governmental
long-term debt. The Village has elected to report the fund as major.
The Capital Projects Fund accounts for property taxes levied and other
resources restricted, committed or assigned primarily for major infrastructure
and other capital improvements. The Village has elected to report the fund as
major.
The Village reports the following major proprietary fund:
The Water and Sewer Fund accounts for the provision of water and sewer
services to the residents of the Village. All activities necessary to provide such
services are accounted for in this fund, including administration, operations,
maintenance, financing and billing and collection.
The Village reports the following fiduciary funds:
The Village reports Pension Trust Funds as fiduciary funds to account for the
Municipal Employees’ Retirement Fund, the Police Pension Fund and the
Firefighter’s Pension Fund.
- 23 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 24 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
d. Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources
measurement focus and the accrual basis of accounting, as are the proprietary fund
and fiduciary fund financial statements. Revenues and additions are recorded when
earned and expenses and deductions are recorded when a liability is incurred. Grants
and similar items are recognized as revenue as soon as all eligibility requirements
imposed by the provider have been met. Operating revenues and expenses are
directly attributable to the operation of the proprietary funds. Non-operating
revenue/expenses are incidental to the operations of these funds.
Governmental fund financial statements are reported using the current financial
resources measurement focus and the modified accrual basis of accounting. Under
the modified accrual basis of accounting, revenues are recognized when susceptible
to accrual (i.e., when they become both measurable and available). “Measurable”
means the amount of the transaction can be determined and “available” means
collectible within the current period or soon enough thereafter to be used to pay
liabilities of the current period, usually 60 days, except for sales tax and
telecommunication taxes which use a 90-day period. The Village recognizes property
taxes when they become both measurable and available in the year intended to
finance. Expenditures are recorded when the related fund liability is incurred.
Principal and interest on general long-term debt are recorded as expenditures when
due.
Sales taxes owed to the state at year end, franchise taxes, licenses, charges for
services and interest associated with the current fiscal period are all considered to be
susceptible to accrual and are recognized as revenues of the current fiscal period.
Income and motor fuel taxes and fines collected and held by the state or county at
year end on behalf of the Village also are recognized as revenue. Fines and permit
revenues are not susceptible to accrual because generally they are not measurable
until received in cash.
In applying the susceptible to accrual concept to intergovernmental revenues, the
legal and contractual requirements of the numerous individual programs are used as
guidelines. Monies that are virtually unrestricted as to purpose of expenditure, which
are usually revocable only for failure to comply with prescribed compliance
requirements, are reflected as revenues at the time of receipt or earlier if the
susceptible to accrual criteria are met.
- 24 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 25 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
d. Measurement Focus, Basis of Accounting and Financial Statement Presentation
(Continued)
The Village reports unearned revenue and unavailable revenue on its financial
statements. Unearned revenue and unavailable revenue arises when a potential
revenue does not meet both the measurable and available or earned criteria for
recognition in the current period. Unearned revenue also arises when resources are
received by the Village before it has a legal claim to them, as when grant monies are
received prior to the incurrence of qualifying expenditures. In subsequent periods,
when both revenue recognition criteria are met, or when the Village has a legal claim
to the resources, the liability or deferred inflow of resources for unearned revenue or
unavailable revenue is removed from the financial statements and revenue is
recognized.
All proprietary funds and pension trust funds are accounted for on a flow of
economic resources measurement focus. With this measurement focus, all assets and
all liabilities associated with the operation of these funds are included on the
statement of net position. Proprietary fund operating statements present increases
(i.e., revenues) and decreases (i.e., expenses) in net position.
e. Cash and Investments
For purposes of the statement of cash flows, the Village’s proprietary fund considers
all highly liquid investments with an original maturity of three months or less when
purchased to be cash equivalents.
f. Investments
Investments with a maturity of less than one year when purchased and non-negotiable
certificates of deposit are stated at cost or amortized cost. Investments with a
maturity greater than one year when purchased and all investments of the pension
trust funds are stated at fair value. Fair value is based on quoted market prices at
December 31 for debt securities, equity securities and mutual funds and contract
values for insurance contracts.
g. Interfund Transactions
During the course of operations, numerous transactions occur between individual
funds for goods provided or services rendered. These receivables and payables are
classified as “due from other funds” or “due to other funds” on the balance sheet.
Short-term interfund loans, if any, are classified as “interfund receivables/payables.”
- 25 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 26 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
g. Interfund Transactions (Continued)
Internal service transactions are accounted for as revenues, expenditures or expenses.
Transactions that constitute reimbursements to a fund for expenditures/expenses
initially made from it that are properly applicable to another fund are recorded as
expenditures/expenses in the reimbursing fund and as reductions of
expenditures/expenses in the fund that is reimbursed.
All other interfund transactions, except for interfund services provided and used are
reported as transfers.
Advances between funds, if any, are offset by nonspendable fund balance in
applicable governmental funds to indicate they are not available for appropriation
and are not expendable available financial resources.
h. Prepaid Items/Expenses
Payments made to vendors for services that will benefit periods beyond the date of
this report are recorded as prepaid items/expenses using the consumption method.
i. Capital Assets
Capital assets, which include property, plant, equipment and infrastructure assets
(e.g., roads, bridges, storm sewers and similar items), are reported in the applicable
governmental or business-type activities columns in the government-wide financial
statements. Capital assets are defined by the Village as assets with an initial,
individual cost of more than $10,000 and an estimated useful life in excess of one
year. Such assets are recorded at historical cost or estimated historical cost if
purchased or constructed. Donated capital assets are recorded at estimated fair
market value at the date of donation.
The costs of normal maintenance and repairs, including street overlays, that do not
add to the value or service capacity of the asset or materially extend asset lives are
not capitalized.
Major outlays for capital assets and improvements are capitalized as projects are
constructed. Interest incurred during the construction phase of capital assets of
business-type activities is included as part of the capitalized value of the assets
constructed. Property, plant and equipment is depreciated using the straight-line
method over the following estimated useful lives:
- 26 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 27 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
i. Capital Assets (Continued)
Years
Buildings, reservoirs, pump house, water mains and improvements 50
Garage and fence 50
Office building, remodeling and improvements 10 - 50
Improvements to water system 20
Vehicles 3 - 10
Equipment 3 - 10
Water meters 10 - 15
Infrastructure
Streets 50
Alleys 10
Signals 25
Infrastructure acquired prior to fiscal years ended June 30, 1980 is also reported.
j. Compensated Absences
Vested or accumulated vacation leave that is matured is reported as an expenditure
and a fund liability of the governmental fund that will pay it in the governmental
fund financial statements. Vested or accumulated vacation leave of proprietary funds
and governmental activities is recorded as an expense and liability of those funds as
the benefits accrue to employees. No liability is recorded for nonvesting
accumulating rights to receive sick pay benefits. However, an expenditure is reported
and a liability is recognized for that portion of accumulating sick leave benefits that it
is estimated will be taken as “terminal leave” at retirement.
In prior years, the General and Water and Sewer Funds have been used to liquidate
the liability for compensated absences.
In addition, the Village has recorded $522,029 for sick time payments to be made in
the future to all civilian employees who are at least age 50 or are any age, but have 30
years of service and sworn personnel who are at least age 50 and have 20 years of
service.
k. Rebatable Arbitrage
The Village reports rebatable arbitrage, if any, as a liability and expense in the
governmental activities column in the government-wide financial statements.
- 27 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 28 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
l. Long-Term Obligations
In the government-wide financial statements and proprietary fund in the fund
financial statements, long-term debt and other long-term obligations are reported as
liabilities in the applicable governmental activities, business-type activities or
proprietary fund financial statements. Bond premiums and discounts, gains/losses or
refundings, as well as issuance costs, are deferred and amortized over the life of the
bonds. Bonds payable are reported net of the applicable bond premium or discount
and gains/losses or refundings. Issuance costs, whether or not withheld from the
actual debt proceeds received, are reported as expenses.
In the fund financial statements, governmental funds recognize bond premiums and
discounts, as well as bond issuance costs, during the current period. The face amount
of debt issued is reported as other financing sources. Premiums received on debt
issuances are reported as other financing sources while discounts on debt issuances
are reported as other financing uses. Issuance costs, whether or not withheld from the
actual debt proceeds received, are reported as expenditures.
m. Fund Balance/Net Position
In the fund financial statements, governmental funds report nonspendable fund
balance for amounts that are either not in spendable form or are legally or
contractually required to be maintained intact. Restrictions of fund balance are
reported for amounts constrained by legal restrictions from outside parties for use for
a specific purpose or externally imposed by outside entities or from enabling
legislation adopted by the Village. Committed fund balance is constrained by formal
actions of the Village’s Board of Trustees, which is considered the Village’s highest
level of decision-making authority. Formal actions include ordinances approved by
the Board of Trustees. Assigned fund balance represents amounts constrained by the
Village’s intent to use them for a specific purpose. The authority to assign fund
balance has been delegated to the Finance Director. Any residual fund balance in the
General Fund and any deficit fund balance of any other governmental fund are
reported as unassigned.
The Village has not yet adopted a flow of funds policy; therefore, in accordance with
GASB Statement No. 54, the default flow of funds has been applied which prescribes
that the funds with the highest level of constraint are expended first. If restricted or
unrestricted funds are available for spending, the restricted funds are spent first.
Additionally, if different levels of unrestricted funds are available for spending the
Village considers committed funds to be expended first followed by assigned funds
and then unassigned funds.
- 28 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 29 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
m. Fund Balance/Net Position (Continued)
In the government-wide financial statements, restricted net positions are legally
restricted by outside parties for a specific purpose. None of the Village’s net
positions are restricted as a result of enabling legislation adopted by the Village. Net
investment in capital assets represents the book value of capital assets less any
long-term debt principal outstanding issued to construct capital assets.
n. Deferred Outflows/Inflows of Resources
In addition to assets, the statement of financial position will sometimes report a
separate section for deferred outflows of resources. This separate financial statement
element, deferred outflows of resources, represents a consumption of net assets that
applies to a future period(s) and so will not be recognized as an outflow of resources
(expense/expenditure) until then. In addition to liabilities, the statement of financial
position will sometimes report a separate section for deferred inflows of resources.
This separate financial statement element, deferred inflows of resources, represents
an acquisition of net assets that applies to a future period(s) and so will not be
recognized as an inflow of resources (revenue) until that time.
o. Accounting Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and the reported amounts
of revenues and expenditures/expenses during the reporting period. Actual results
could differ from those estimates.
2. DEPOSITS AND INVESTMENTS
Permitted Deposits and Investments - The Village’s investment policy authorizes the
Village to make deposits/invest in insured commercial banks, savings and loan institutions,
obligations of the U.S. Treasury and U.S. agencies, insured credit union shares, money
market mutual funds with portfolios of securities issued or guaranteed by the United States
Government or agreements to repurchase these same obligations, repurchase agreements,
short-term commercial paper rated within the three highest classifications by at least two
standard rating services, Illinois Funds and derivatives consistent with the Government
Finance Officers Association (GFOA) Recommended Practice on Use of Derivatives by
state and local governments. Pension funds may also invest in certain non-U.S. obligations,
Illinois municipal corporations tax anticipation warrants, veteran’s loans, obligations of the
State of Illinois and its political subdivisions, and Illinois insurance company general and
separate accounts, mutual funds and equity securities.
- 29 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 30 -
2. DEPOSITS AND INVESTMENTS (Continued)
Illinois Funds is an investment pool managed by the State of Illinois, Office of the
Treasurer, which allows governments within the state to pool their funds for investment
purposes. Illinois Funds is not registered with the SEC as an investment company, but does
operate in a manner consistent with Rule 2a7 of the Investment Company Act of 1940.
Investments in Illinois Funds are valued at Illinois Funds’ share price, the price for which
the investment could be sold.
Illinois Metropolitan Investment Fund (IMET) is a not-for-profit investment trust formed
pursuant to the Illinois Municipal Code and managed by a Board of Trustees elected from
the participating members. IMET is not registered with the SEC as an investment company.
Investments in IMET are valued at IMET’s share price, the price for which the investment
could be sold.
It is the investment credit risk policy of the Village to invest its funds in a manner which
will provide the highest investment return with the maximum security while meeting the
daily cash flow demands of the Village and conforming to all state and local statutes
governing the investment of public funds, using the “prudent person” standard for
managing the overall portfolio. The primary objective of the policy is legality, safety
(preservation of capital and protection of investment principal), liquidity and yield.
Village Deposits
Custodial credit risk for deposits with financial institutions is the risk that in the event of a
bank’s failure, the Village’s deposits may not be returned to it. The Village’s investment
policy requires pledging of collateral with a fair value of 110% of all bank balances in
excess of federal depository insurance with the collateral held by an agent of the Village in
the Village’s name.
Village Investments
As of December 31, 2014, the Village had the following debt security investments and
maturities.
Investment Maturities (in Years)
Less More
Fair Value than 1 1-5 6-10 than 10
IMET (1-3 year fund) $ 264,436 $ - $ 264,436 $ - $ -
Negotiable CDs 3,241,729 3,241,729 - - -
TOTAL $ 3,506,165 $ 3,241,729 $ 264,436 $ - $ -
- 30 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 31 -
2. DEPOSITS AND INVESTMENTS (Continued)
Village Investments (Continued)
In accordance with its investment policy, the Village limits its exposure to interest rate risk
by structuring the portfolio so that securities mature to meet cash requirements for ongoing
operations, thereby avoiding the need to sell securities on the open market prior to maturity
and by investing operating funds primarily in shorter-term securities. However, securities
may be sold prior to maturity if the sale minimizes the loss of principal in a declining credit
market, a security swap would improve the quality, yield or target duration of the portfolio
or for liquidity needs of the portfolio. Investments reserve funds may be purchased with
maturities to match future projects or liability requirements.
The Village limits its exposure to credit risk, the risk that the issuer of a debt security will
not pay its par value upon maturity, by primarily investing in obligations guaranteed by the
United States Government or securities issued by agencies of the United States
Government that are explicitly or implicitly guaranteed by the United States Government
or in pools. IMET is rated AAA.
Custodial credit risk for investments is the risk that, in the event of the failure of the
counterparty to the investment, the Village will not be able to recover the value of its
investments that are in possession of an outside party. To limit its exposure, the Village’s
investment policy requires all security transactions that are exposed to custodial credit risk
to be processed on a delivery versus payment (DVP) basis with the underlying investments
held by a third party acting as the Village’s agent separate from where the investment was
purchased or by the trust department of the bank where purchased, in the Village’s name.
Illinois Funds and IMET are not subject to custodial credit risk.
Concentration of credit risk - The Village’s investment policy does not contain any specific
guidelines on the diversification of the investment portfolio. At December 31, 2014, the
Village had 79.6% in negotiable certificate of deposits (CDs) and 6.5% in IMET.
3. RECEIVABLES
a. Property Taxes
Property taxes for 2014 attach as an enforceable lien on January 1, 2014 on property
values assessed as of the same date. Taxes are levied by December of the fiscal year
(by passage of a Tax Levy Ordinance). Tax bills are prepared by the County and
issued on or about February 1, 2014 and August 1, 2014 and are payable in two
installments, on or about March 1, 2014 and September 1, 2014. The County collects
such taxes and remits them periodically. The allowance for uncollectible taxes has
been stated at 3% of the tax levy, to reflect actual collection experience. Since the
2014 levy is intended to fund the 2015 fiscal year, the levy has been recorded as a
receivable and unavailable or unearned revenue.
- 31 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 32 -
3. RECEIVABLES (Continued)
b. Loan Receivable - Developer
In December 2010, the Village executed a loan of $1,700,000 to a developer in return
for the developer agreeing to build and operate a senior living facility in the
Lehigh/Ferris TIF District. The loan will be repaid upon sale or refinancing the
development. In addition, the Village will reimburse the developer up to $1,100,000
from new incremental taxes generated by the development during the life of the TIF
District.
4. CAPITAL ASSETS
Capital asset activity for the year ended December 31, 2014 was as follows:
Beginning
Balances
January 1
Additions
Retirements
Ending
Balances
December 31
GOVERNMENTAL ACTIVITIES
Capital assets not being depreciated
Land (including right of ways) $ 43,972,244 $ - $ - $ 43,972,244
Construction in progress - - - -
Total capital assets not being depreciated 43,972,244 - - 43,972,244
Capital assets being depreciated
Buildings and improvements 18,175,872 - - 18,175,872
Vehicles and equipment 5,862,968 876,383 177,004 6,562,347
Infrastructure 30,759,292 - - 30,759,292
Total capital assets being depreciated 54,798,132 876,383 177,004 55,497,511
Less accumulated depreciation for
Buildings and improvements 11,900,082 587,535 - 12,487,617
Vehicles and equipment 4,586,227 390,973 177,004 4,800,196
Infrastructure 24,212,449 539,879 - 24,752,328
Total accumulated depreciation 40,698,758 1,518,387 177,004 42,040,141
Total capital assets being depreciated, net 14,099,374 (642,004) - 13,457,370
GOVERNMENTAL ACTIVITIES
CAPITAL ASSETS, NET
$ 58,071,618
$ (642,004)
$ -
$ 57,429,614
Depreciation expense was charged to functions/programs of the governmental activities as
follows:
GOVERNMENTAL ACTIVITIES
General government $ 448,954
Public safety 315,370
Streets and sidewalks 754,063
TOTAL DEPRECIATION EXPENSE - GOVERNMENTAL ACTIVITIES $ 1,518,387
- 32 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 33 -
4. CAPITAL ASSETS (Continued)
Beginning
Balances
January 1
Additions
Retirements
Ending
Balances
December 31
BUSINESS-TYPE ACTIVITIES
Capital assets not being depreciated
Construction in progress $ - $ 20,608 $ - $ 20,608
Total capital assets not being depreciated - 20,608 - 20,608
Capital assets being depreciated
Buildings and improvements 14,466,610 1,791,700 - 16,258,310
Equipment 2,410,075 - 94,521 2,315,554
Total capital assets being depreciated 16,876,685 1,791,700 94,521 18,573,864
Less accumulated depreciation for
Buildings and improvements 7,424,844 278,420 - 7,703,264
Equipment 1,440,807 97,439 94,521 1,443,725
Total accumulated depreciation 8,865,651 375,859 94,521 9,146,989
Total capital assets being
depreciated, net
8,011,034
1,415,841
-
9,426,875
BUSINESS-TYPE ACTIVITIES CAPITAL
ASSETS, NET
$ 8,011,034
$ 1,436,449
$ -
$ 9,447,483
5. RISK MANAGEMENT
The Village is exposed to various risks of loss related to torts; theft of, damage to and
destruction of assets; errors and omissions; injuries to employees; employee health; and
natural disasters.
These risks (except employee health) are covered by the Village’s participation in
Intergovernmental Risk Management Association (IRMA), an organization of
municipalities and special villages in Northeastern Illinois which have formed an
association under the Illinois Intergovernmental Cooperations Statute to pool its risk
management needs. The agency administers a mix of self-insurance and commercial
insurance coverages; property/casualty and workers’ compensation claim
administration/litigation management services; unemployment claim
administration/litigation management services; unemployment claim administration;
extensive risk management/loss control consulting and training programs; and a risk
information system and financial reporting service for its members.
- 33 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 34 -
5. RISK MANAGEMENT (Continued)
The Village’s payments to IRMA are displayed on the financial statements as
expenditures/expenses in appropriate funds. Each member assumes the first $2,500 of each
occurrence and IRMA has a mix of self-insurance and commercial insurance at various
amounts above that level. Each member appoints one delegate, along with an alternate
delegate, to represent the member on the Board of Directors. The Village does not exercise
any control over the activities of IRMA beyond its representation on the Board of
Directors. The Village paid an original contribution that was based on the Village’s eligible
revenue as defined in the by-laws of IRMA and experience modification factors based on
past member loss experience.
The Village has a contractual obligation to fund any deficit of IRMA attributable to a
membership year during which the Village was a member. Supplemental contributions may
be required to fund these deficits. No supplemental contributions were due at
December 31, 2014. The Village has recorded a receivable for the excess surplus balance
of $848,115 in the General Fund as of December 31, 2014.
The Village participates in the Intergovernmental Personnel Benefit Cooperative (IPBC).
IPBC is a public entity risk pool established by certain units of local government in Illinois
to administer some or all of the personnel benefit programs (primarily medical, dental and
life insurance coverage) offered by its members to their officers and employees and to the
officers and employees of certain other governmental, quasi governmental and nonprofit
public service entities. Risk of loss is retained by the Village, except that IPBC purchases
excess coverage policies. The Village had terminal reserve net of any deficits of other
subaccounts as of June 30, 2014 (most recent available) of $533,663. This amount was
declared as a dividend to the Village and, therefore, has been recorded as a receivable in
the General Fund.
Management consists of a Board of Directors comprised of one appointed representative
from each member. In addition, there are three officers, a Benefit Administrator and a
Treasurer. The Village does not exercise any control over activities of IPBC beyond its
representation on the Board of Directors.
6. LONG-TERM DEBT
a. General Obligation Bonds
The Village issues general obligation bonds to provide funds for the acquisition and
construction of major capital facilities. General obligation bonds have been issued
for both general government and proprietary activities. These bonds, therefore, are
reported in the proprietary fund if they are expected to be repaid from proprietary
revenues. In addition, general obligation bonds have been issued to refund general
obligation bonds.
- 34 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 35 -
6. LONG-TERM DEBT (Continued)
a. General Obligation Bonds (Continued)
General obligation bonds are direct obligations and pledge the full faith and credit of
the Village. General obligation bonds currently outstanding are as follows:
Fund Debt
Retired By
Balances
January 1
Additions
Reductions
Balances
December 31
Due Within
One Year
$9,200,000 General
Obligation Bonds Series
2007 dated November 1,
2007, due in annual
installments of $270,000
to $560,000 plus interest
at 4%, due on June 1 and
December 1 of each year.
Lehigh/
Ferris TIF
$ 7,165,000
$ -
$ 510,000
$ 6,655,000
$ 535,000
$7,650,000 General
Obligation Refunding
Bonds, Series 2009 dated
April 1, 2009, due in
annual installments of
$225,000 to $1,690,000
plus interest at 1.0% to
2.6%, due on June 1 and
December 1 of each year.
Water
and
Sewer
Debt
Service
422,500
1,267,500
-
-
422,500
1,267,500
-
-
-
-
$4,920,000 General
Obligation Bonds, Series
2009A dated October 1,
2009, due in annual
installments of $355,000
to $600,000 plus interest
at 3.000% to 4.125%, due
on June 1 and
December 1 of each year.
Waukegan
Road
TIF
3,340,000
-
475,000
2,865,000
515,000
$1,845,000 General
Obligation Bonds, Series
2010A dated March 31,
2010, due in annual
installments of $270,000
to $400,000 plus interest
at 2%, due on June 15
and December 15 of each
year.
Debt
Service
Water
and
Sewer
224,000
176,000
-
-
224,000
176,000
-
-
-
-
- 35 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 36 -
6. LONG-TERM DEBT (Continued)
a. General Obligation Bonds (Continued)
Fund Debt
Retired By
Balances
January 1
Additions
Reductions
Balances
December 31
Due Within
One Year
$8,130,000 Taxable
General Obligation Bonds
Series 2010B dated
March 31, 2010, due in
annual installments of
$415,000 to $1,870,000
plus interest at 3.2% to
6.0%, due on June 15 and
December 15 of each
year.
Debt
Service
Water
and
Sewer
$ 4,552,800
3,577,200
$ -
-
$ -
-
$ 4,552,800
3,577,200
$ 232,400
182,600
$1,415,000 General
Obligation Bonds Series
2014 dated March 25,
2014, due in annual
installments of $470,000
to $475,000 plus interest
at 2.395% due on June 15
and December 15 of each
year.
Debt
Service
-
1,415,000
-
1,415,000
-
TOTAL $ 20,725,000 $ 1,415,000 $ 3,075,000 $ 19,065,000 $ 1,465,000
b. Installment Notes Payable
The Village issues installment notes payable to provide funds for the acquisition of
property and the development of the tax increment financing villages. Installment
notes payable have been issued for both general government and proprietary
activities.
Fund Debt
Retired By
Balances
January 1
Additions
Reductions
Balances
December 31
Due Within
One Year
$3,165,000 General
Obligation Bank
Promissory Note for
projects related to the Tax
Increment Financing Fund
and the Economic
Development Fund
principal due semiannually
through 2018 with interest
at 5.32%.
Waukegan
Road
TIF
$ 1,079,121
$ -
$ 227,912
$ 851,209
$ 237,366
- 36 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 37 -
6. LONG-TERM DEBT (Continued)
b. Installment Notes Payable (Continued)
Fund Debt
Retired By
Balances
January 1
Additions
Reductions
Balances
December 31
Due Within
One Year
$1,060,000 General
Obligation Bank
Promissory note, Series
2013 for land purchase,
principal is payable
annually over seven years.
Interest is at 2% and is due
beginning May 31, 2014.
General
$ 1,060,000
$ -
$ 142,583
$ 917,417
$ 145,434
TOTAL $ 2,139,121 $ - $ 370,495 $ 1,768,626 $ 382,800
c. Intergovernmental Agreement with School District 67
In 1996, the Village entered into an agreement with Morton Grove School District
67. The agreement calls for the Village to remit to the school district a portion of the
proposed tax revenue due to projected growth in the equalized assessed valuation for
existing properties located on Waukegan Road and existing on the date when the TIF
was formed. Payments are made December 31 of each year and shall continue until
the conclusion of the TIF at which time all future growth in the equalized assessed
valuation will be released for distribution of property tax revenues to the overlapping
taxing jurisdictions. During the year ended December 31, 2014, the Village made
total intergovernmental payments of $220,460 from general (non-TIF) revenues. The
tax revenue is determined on an annual basis and the estimated future liability is
shown below.
d. Intergovernmental Agreement with School District 70
In 2000, the Village entered into a second intergovernmental agreement, this time
with Morton Grove School District 70. The agreement calls for the Village to remit
to the school district a portion of the proposed tax revenue due to projected growth in
the equalized assessed valuation for existing properties located in the Lehigh/Ferris
TIF and existing on the date when the TIF was formed. As with the agreement with
School District 67, payments are made December 31 of each year and shall continue
until the conclusion of the TIF at which time all future growth in the equalized
assessed valuation will be released for distribution of property tax revenues to the
overlapping taxing jurisdictions. During the year ended December 31, 2014, the
Village made total intergovernmental payments of $129,096 from general (non-TIF)
revenues. The tax revenue is determined on an annual basis and the estimated future
liability is shown below.
- 37 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 38 -
6. LONG-TERM DEBT (Continued)
d. Intergovernmental Agreement with School District 70 (Continued)
Year
Ending
School
District 67
School
District 70
Total
2015 $ 236,891 $ 140,720 $ 377,611
2016 253,938 152,722 406,660
2017 271,625 165,114 436,739
2018 289,975 177,909 467,884
2019-2023 - 1,096,499 1,096,499
TOTAL $ 1,052,429 $ 1,732,964 $ 2,785,393
e. Debt Service Requirements to Maturity
General Obligation Bonds
Year Governmental Activities Business-Type Activities
Ending Principal Interest Total Principal Interest Total
2015 $ 1,282,400 $ 633,728 $ 1,916,128 $ 182,600 $ 183,205 $ 365,805
2016 1,338,000 586,735 1,924,735 187,000 177,362 364,362
2017 1,395,800 535,292 1,931,092 189,200 170,630 359,830
2018 2,103,600 479,197 2,582,797 191,400 163,062 354,462
2019 1,369,800 404,173 1,773,973 200,200 154,066 354,266
2020 1,413,800 355,141 1,768,941 211,200 144,657 355,857
2021 1,465,000 304,251 1,769,251 220,000 134,730 354,730
2022 1,036,800 251,315 1,288,115 233,200 124,390 357,590
2023 1,083,000 206,133 1,289,133 242,000 112,147 354,147
2024 1,129,200 158,809 1,288,009 250,800 99,321 350,121
2025 330,400 109,012 439,412 259,600 85,653 345,253
2026 341,600 90,675 432,275 268,400 71,245 339,645
2027 352,800 71,375 424,175 277,200 56,080 333,280
2028 411,600 50,736 462,336 323,400 39,864 363,264
2029 434,000 26,040 460,040 341,000 20,460 361,460
TOTAL $ 15,487,800 $ 4,262,612 $ 19,750,412 $ 3,577,200 $ 1,736,872 $ 5,314,072
Total Installment Notes Payable
Year Governmental Activities
Ending Principal Interest Total
2015 $ 382,800 $ 50,878 $ 433,678
2016 395,501 38,177 433,678
2017 408,776 24,902 433,678
2018 263,555 11,690 275,245
2019 157,423 6,360 163,783
2020 160,571 3,211 163,782
TOTAL $ 1,768,626 $ 135,218 $ 1,903,844
- 38 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 39 -
6. LONG-TERM DEBT (Continued)
f. Changes in Long-Term Liabilities
During the fiscal year, the following changes occurred in liabilities reported on the
schedule of long-term liabilities payable by governmental funds:
Balances
January 1
Additions
Reductions
Balances
December 31
Due Within
One Year
GOVERNMENTAL ACTIVITIES
General obligation bonds
payable
$ 16,549,300
$ 1,415,000
$ 2,476,500
$ 15,487,800
$ 1,282,400
Unamortized premium on bonds 63,961 - 6,450 57,511 -
Unamortized discount on bonds (7,199) - (1,987) (5,212) -
Installment notes payable 2,139,121 - 370,495 1,768,626 382,800
Intergovernmental agreement
payable
3,134,950
-
349,557
2,785,393
377,612
Net pension obligation 16,793,020 1,110,641 - 17,903,661 -
Net other postemployment
benefit obligation
3,420,715
607,520
-
4,028,235
-
*Compensated absences payable 609,900 26,892 49,431 587,361 58,736
TOTAL GOVERNMENTAL
ACTIVITIES DEBT
$ 42,703,768
$ 3,160,053
$ 3,250,446
$ 42,613,375
$ 2,101,548
* Governmental activities’ compensated absences, net pension obligation and net
other postemployment benefit obligation are liquidated by the General Fund, the fund
in which the related salary has been charged.
Balances
January 1
Additions
Reductions
Balances
December 31
Due Within
One Year
BUSINESS-TYPE ACTIVITIES
General obligation bonds
payable
$ 4,175,700
$ -
$ 598,500
$ 3,577,200
$ 182,600
Unamortized premium on
bonds
2,887
-
8,378
(5,491)
-
*Net other postemployment
benefit obligation
275,561
66,459
-
342,020
-
*Compensated absences payable 44,460 41,416 4,446 81,430 8,143
TOTAL BUSINESS-TYPE DEBT $ 4,498,608 $ 107,875 $ 611,324 $ 3,995,159 $ 190,743
* Business-type activities’ net other postemployment benefit obligation and
compensated absences are liquidated by the Water and Sewer Fund, the fund in
which the related salary has been charged.
- 39 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 40 -
6. LONG-TERM DEBT (Continued)
g. Legal Debt Margin
The Village is a home rule municipality.
Article VII, Section 6(k) of the 1970 Illinois Constitution governs computation of the
legal debt margin.
“The General Assembly may limit by law the amount and require referendum
approval of debt to be incurred by home rule municipalities, payable from ad
valorem property tax receipts, only in excess of the following percentages of the
assessed value of its taxable property . . . (2) if its population is more than 25,000 and
less than 500,000 an aggregate of one percent: . . . indebtedness which is outstanding
on the effective date (July 1, 1971) of this constitution or which is thereafter
approved by referendum . . . shall not be included in the foregoing percentage
amounts.”
To date the General Assembly has set no limits for home rule municipalities.
h. Refunding Bonds
On October 1, 2009, the Village issued $4,920,000 Series 2009A General Obligation
Refunding Bonds to advance refund $4,785,000 of the General Obligation
Promissory Note, Series 2002. The proceeds of the 2009 issuance were placed in an
irrevocable trust to provide all future debt service payments on the old bonds.
Accordingly, the trust account assets and the liability for the defeased bonds are not
included in the financial statements. The defeased bonds are due annually on June 1
through June 1, 2022, and are callable anytime after June 1, 2016. At December 31,
2014, $3,445,000 of the refunded bonds were outstanding.
i. Economic Development and Redevelopment Agreements
1. CVS, Inc.
During June 2006, CVS, Inc. (CVS) purchased the Osco Drug (Osco) store
with which the Village had previously entered into an economic development
agreement that stated that the total amount paid will not exceed $250,000. It
was determined by legal counsel that the economic agreement that the Village
had with Osco remains applicable with CVS. Payment to Osco during 2006
through date of sale totaled $3,971. No amounts were due to CVS under the
terms of the agreement for the fiscal year ended December 31, 2014.
- 40 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 41 -
6. LONG-TERM DEBT (Continued)
i. Economic Development and Redevelopment Agreements (Continued)
2. Gary D. McGrath Audi
On December 9, 2013, the Village entered into a redevelopment agreement
with Gary D. McGrath, a local auto dealership owner. The agreement calls for
Mr. McGrath to provide new jobs, substantial new property taxes, sales taxes,
and economic development for the Village. The Village will waive certain
permit fees, contribute $250,000 to the construction costs, and share sales tax
revenue generated by the Audi dealership as follows: the dealership will
receive 75% of sales taxes paid to the Village for the first ten years after the
dealership opens up to a maximum of $5,000,000. Amounts paid under the
terms of the agreement were $250,000 for fiscal year ended December 31,
2014.
3. Bond Drug Company of Illinois, dba Walgreens and MRD - Morton Grove, LP
On June 1, 1999, the Village entered into a redevelopment agreement with
Bond Drug Company of Illinois (Walgreens) and MRD - Morton Grove, LP to
develop a site for a Walgreens Drug Store in the Village. The Village has
required, as part of the redevelopment agreement, that certain infrastructure
improvements be constructed. In order to comply with the Village’s
requirements for infrastructure improvement, the Village has agreed to enter
into a sales tax revenue sharing program upon the commencement of retail
operations to be public. The program will continue until the developer’s receipt
of $253,320 or ten years following the opening of the store, whichever comes
first. The first $110,000 of sales tax revenue of the $253,320 shall be retained
by the Village. The Village will retain 100% of the sales tax on the first
$2,000,000 of annual sales and will share equally in the sales tax on annual
sales exceeding $2,000,000. No amounts were due to Walgreens under the
terms of the agreement for the fiscal year ended December 31, 2014.
4. L & K Restaurants of Morton Grove LLC
On August 31, 2010, the Village entered into a development agreement with
L & K Restaurants of Morton Grove LLC to develop a new Culver’s
Restaurant (Culver’s). The agreement requires the Village to reimburse the
developer 100% of sales taxes paid by the business for the first year after the
Culver’s store is open, and 50% of the sales taxes paid by the business from
year two through ten up to total revenue of $125,000 with additional property
tax and performance related payments up to an additional $100,000. Amounts
paid under the terms of the agreement were $57,027 for fiscal year ended
December 31, 2014.
- 41 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 42 -
6. LONG-TERM DEBT (Continued)
j. Noncommitment Debt
Industrial Revenue Bonds
On December 14, 2007, the Village approved the sale of $30,000,000 Cultural
Facility Variable Rate Demand Revenue Bonds, Series 2007 to be used for the
construction of a Holocaust Museum in Skokie, Illinois by a not-for-profit agency.
These bonds are industrial revenue bonds and are secured solely by the property
financed. The bonds are payable solely by the property owners. The Village is not
obligated in any manner for the repayment of the bonds. Accordingly, the bonds
outstanding are not reported as a liability in these financial statements.
7. INDIVIDUAL FUND DISCLOSURES
a. Due From/To Other Funds
Receivable Fund Payable Fund Amount
GOVERNMENTAL FUNDS
General Waukegan Road TIF $ 696,521
General Economic Development 650,020
General Debt Service 422,003
TOTAL $ 1,768,544
Significant amounts due from/to other funds at December 31, 2014 are as follows:
$422,003 due from the Debt Service Fund to the General Fund. This balance is
three months of sale tax overdue from the State Comptroller. The balance will
be paid in the first quarter of 2015.
$650,020 due from the Economic Development Fund to the General Fund.
This balance is three months of sale tax overdue from the State Comptroller.
The balance will be paid in the first quarter of 2015.
$696,521 due from the Waukegan Road TIF Fund to the General Fund. This
balance is from a loan from the General Fund to fund debt service payments.
The balance will be paid in 2015.
- 42 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 43 -
7. INDIVIDUAL FUND DISCLOSURES (Continued)
b. Due From/To Fiduciary Funds
Receivable Fund Payable Fund Amount
PENSION TRUST FUNDS
Municipal Employees Retirement General $ 2,266
TOTAL $ 2,266
Significant amounts due from/to fiduciary funds at December 31, 2014 are as
follows:
$2,266 due from General Fund to the Municipal Employees Retirement
Pension Trust Fund for contributions due at year end.
c. Advances
As of December 31, 2014, individual fund advances between funds were as follows:
Receivable Fund Payable Fund Amount
General Waukegan Road TIF $ 1,388,930
General Dempster/Waukegan TIF 125,821
Lehigh/Ferris TIF Dempster/Waukegan TIF 44,364
TOTAL $ 1,559,115
Significant amounts of advances at December 31, 2014 are as follows:
$1,388,930 was advanced by the General Fund as initial costs of the Waukegan
Road TIF. This amount will be repaid in future years from incremental
property tax revenues of the TIF.
d. Transfers
For the year ended December 31, 2014, individual fund transfers between funds were
as follows:
Transferred to Transferred from Amount
General Lehigh/Ferris TIF $ 265,200
Debt Service General 492,263
TOTAL $ 757,463
- 43 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 44 -
7. INDIVIDUAL FUND DISCLOSURES (Continued)
d. Transfers (Continued)
Significant amounts of transfers during the year ended December 31, 2014 are as
follows:
$265,200 was transferred from the Lehigh/Ferris TIF Fund to the General Fund
for administrative costs. This amount will not be repaid.
$492,263 was transferred from the General Fund to the Debt Service Fund to
fund a deficit. This amount will not be repaid.
e. Deficit Fund Balances
As of December 31, 2014, individual funds with deficit fund balances were as
follows:
Fund Deficit
Major Governmental
Waukegan Road TIF $ 2,084,392
Nonmajor Governmental
Economic Development 424,261
Dempster/Waukegan TIF 196,666
8. CONTINGENT LIABILITIES
a. Litigation
The Village is a defendant in various lawsuits. Although the outcome of these
lawsuits is not presently determinable, in the opinion of the Village’s attorney, the
resolution of these matters will not have a material adverse effect on the financial
condition of the Village.
b. Grants
The Village participates in numerous federally assisted programs, on both a direct
and state pass-through basis, as well as on a service provider basis. Principal among
these are the Federal Aid Highway Program and Highway Planning and
Construction.
In connection with these grants, the Village is required to comply with specific terms
and agreements, as well as applicable federal and state laws and regulations. Such
compliance is subject to review and audit by the grantors and their representatives.
- 44 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 45 -
8. CONTINGENT LIABILITIES (Continued)
b. Grants (Continued)
In the opinion of management, the Village has complied with all requirements.
However, since such programs are subject to future audit or review, the possibility of
disallowed expenditures exists. In the event of any disallowance of claimed
expenditures, the Village expects the resulting liability to be immaterial.
9. JOINT VENTURES
Solid Waste Agency of Northern Cook County (SWANCC)
The Village is a member of the Solid Waste Agency of Northern Cook County (SWANCC)
which consists of 23 municipalities. SWANCC is a municipal corporation and public body
politic and corporate established pursuant to the Intergovernmental Cooperation Act of the
State of Illinois. SWANCC is empowered to plan, construct, finance, operate and maintain
a solid waste disposal system to serve its members.
SWANCC is governed by a Board of Directors which consists of the mayor or president
from each member municipality. Each director has an equal vote. The officers of
SWANCC are appointed by the Board of Directors. The Board of Directors determines the
general policy of SWANCC, makes all appropriations, approves contracts, provides for the
issuance of debt, adopts by-laws, rules and regulations and exercises such powers and
performs such duties as may be prescribed in the agency agreement or the by-laws.
Complete financial statements for SWANCC can be obtained from the SWANCC’s
administrative office at 2700 Patriot Boulevard, Suite 110, Glenview, Illinois 60026.
SWANCC’s outstanding bonds are revenue obligations. They are limited obligations of
SWANCC with a claim for payment solely from and secured by a pledge of the revenues of
the system and amounts in various funds and accounts established by SWANCC
resolutions. The bonds are not the debt of any member. SWANCC has no power to levy
taxes.
Revenues of the system consist of (1) all receipts derived from solid waste disposal
contracts or any other contracts for the disposal of waste; (2) all income derived from the
investment of monies; and (3) all income, fees, service charges and all grants, rents and
receipts derived by SWANCC from the ownership and operation of the system. SWANCC
covenants to establish fees and charges sufficient to provide revenues to meet all its
requirements.
- 45 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 46 -
9. JOINT VENTURES (Continued)
Solid Waste Agency of Northern Cook County (SWANCC) (Continued)
SWANCC has entered into solid waste disposal contracts with the member municipalities.
The contracts are irrevocable and may not be terminated or amended except as provided for
in the contract. Each member is obligated, on a “take or pay” basis, to deliver a minimum
amount of solid waste to the system. The obligation of the Village to make all payments as
required by this contract is unconditional and irrevocable, without regard to performance or
nonperformance by SWANCC of its obligations under the contract. The contract does not
constitute an indebtedness of the Village within the meaning of any statutory or
constitutional limitation.
In accordance with the contract, the Village made payments totaling $430,346 to
SWANCC in 2014, which includes payment for debt contribution. The Village does not
have an equity interest in SWANCC at December 31, 2014.
Commencing in 2008, the annual expense will be subject to change based upon the actual
tonnage of refuse disposed of and current SWANCC costs. Beginning in 2004, the cost of
brush collection was transferred to the residents. The Village continues to pay tipping fees
averaging about $35,507 a month or $426,084 a year.
10. JOINTLY GOVERNED ORGANIZATION
Regional Emergency Dispatch Center
The Regional Emergency Dispatch Center (the Center) is a governmental joint venture of
Illinois municipalities which is used to account for the resources involved in dispatching
fire and medical emergency services to a seven-community area. The fund is supported by
contributions by the eight-member departments.
Management consists of a Board of Directors comprised of one elected officer from each
member. There is also a Joint Chiefs Authority which is comprised of the fire chief from
each member, which takes care of day-to-day activities.
The Village does not exercise any control over the activities of the Center beyond its
representation on the Board of Directors and Joint Chiefs Authority.
Annual contributions are determined each year based on the estimated number of fire calls
for the upcoming year. Each year, the members sign a contract which denotes the amount
of the contribution for the year. The Board of Directors has the power to levy a special
assessment should a deficit or emergency arise.
Complete separate financial statements for the Center may be obtained at the Center’s
office located at 1842 Shermer Road, Northbrook, Illinois 60062.
- 46 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 47 -
11. OTHER POSTEMPLOYMENT BENEFITS
a. Plan Description
In addition to providing the pension benefits described, the Village provides other
postemployment health care benefits (OPEB) for retired employees through a single-
employer defined benefit plan (the Plan). The benefits, benefit levels, employee
contributions and employer contributions are governed by the Village and can be
amended by the Village through its personnel manual and union contracts. The Plan
is not accounted for as a trust fund, as an irrevocable trust has not been established to
account for the Plan. The Plan does not issue a separate report. The activity of the
Plan is reported in the Village’s governmental and business-type activities.
b. Benefits Provided
The Village provides pre and post-Medicare postretirement health insurance to
retirees, their spouses and dependents (enrolled at time of employee’s retirement). To
be eligible for benefits, the employee must qualify for retirement under one of the
Village’s four retirement plans. The Village provides a subsidy of 50% of the
blended healthcare premium to retired members with ten or more years of service.
Police officers and firefighters who became disabled in the line of duty during an
emergency receive continuation of healthcare benefits at no cost to the member.
Upon a retiree becoming eligible for Medicare, the amount payable under the
Village’s health plan will be reduced by the amount payable under Medicare for
those expenses that are covered under both.
c. Membership
At December 31, 2013 (most recent available), membership consisted of:
Retirees and beneficiaries currently receiving
benefits 42
Terminated employees entitled
to benefits but not yet receiving them -
Active employees 143
TOTAL 185
Participating employers 1
d. Funding Policy
The Village is not required to and currently does not advance fund the cost of
benefits that will become due and payable in the future. Active employees do not
contribute to the Plan until retirement.
- 47 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 48 -
11. OTHER POSTEMPLOYMENT BENEFITS (Continued)
e. Annual OPEB Costs and Net OPEB Obligation
The Village’s annual OPEB cost, the percentage of annual OPEB cost contributed to
the Plan and the net OPEB obligation was as follows:
Fiscal
Year
Ended
Annual
OPEB
Cost
Employer
Contributions
Percentage of
Annual OPEB
Cost
Contributed
Net OPEB
Obligation
December 31, 2012 $ 1,173,358 $ 623,335 53.1% $ 2,941,381
December 31, 2013 1,415,247 660,352 46.7% 3,696,276
December 31, 2014 1,481,863 807,884 54.5% 4,370,255
The net OPEB obligation as of December 31, 2014 was calculated as follows:
Annual required contribution $ 1,447,500
Interest on net OPEB obligation 147,851
Adjustment to annual required contribution (113,488)
Annual OPEB cost 1,481,863
Contributions made 807,884
Increase in net OPEB obligation 673,979
Net OPEB obligation, beginning of year 3,696,276
NET OPEB OBLIGATION, END OF YEAR $ 4,370,255
Funded Status and Funding Progress: The projected funded status and funding
progress of the Plan as of December 31, 2013 (most recent available) was as follows:
Actuarial accrued liability (AAL) $ 20,464,527
Actuarial value of plan assets -
Unfunded actuarial accrued liability (UAAL) 20,464,527
Funded ratio (actuarial value of plan assets/AAL) 0.00%
Covered payroll (active plan members) $ 12,048,653
UAAL as a percentage of covered payroll 169.85%
- 48 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 49 -
11. OTHER POSTEMPLOYMENT BENEFITS (Continued)
e. Annual OPEB Costs and Net OPEB Obligation (Continued)
Actuarial valuations of an ongoing plan involve estimates of the value of reported
amounts and assumptions about the probability of occurrence of events far into the
future. Examples include assumptions about future employment, mortality and the
healthcare cost trend. Amounts determined regarding the funded status of the Plan
and the annual required contributions of the employer are subject to continual
revision as actual results are compared with past expectations and new estimates are
made about the future. The schedule of funding progress, presented as required
supplementary information following the notes to financial statements, presents
multi-year trend information that shows whether the actuarial value of plan assets is
increasing or decreasing over time relative to the actuarial accrued liabilities for
benefits.
Actuarial methods and assumptions - projections of benefits for financial reporting
purposes are based on the substantive plan (the Plan as understood by the employer
and plan members) and include the types of benefits provided at the time of each
valuation and the historical pattern of sharing of benefit costs between the employer
and plan members to that point. The actuarial methods and assumptions used include
techniques that are designed to reduce short-term volatility in actuarial accrued
liabilities and the actuarial value of assets, consistent with the long-term perspective
of the calculations.
In the December 31, 2013 actuarial valuation, the entry-age normal actuarial cost
method was used. The actuarial assumptions included a 4.5% investment rate of
return and a healthcare cost trend rate of 8.03% with an ultimate healthcare inflation
rate of 4.5%. Both rates include a 4% wage inflation assumption. The actuarial value
of assets was not determined as the Village has not advance funded its obligation.
The Plan’s unfunded actuarial accrued liability is being amortized as a level
percentage of projected payroll on an open basis. The remaining amortization period
at December 31, 2013 was 30 years.
12. DEFINED BENEFIT PENSION PLANS
a. Plan Descriptions
The Village contributes to five defined benefit pension plans, the Illinois Municipal
Retirement Fund (IMRF), an agent multiple-employer public employees retirement
system; the Sheriff’s Law Enforcement Personnel Fund (SLEP), which is
administered by IMRF, an agent multiple-employer public employee retirement
system; the Municipal Employees’ Retirement Fund (MERF), an agent multiple-
employer plan consisting of the Village and the Morton Grove Public Library; the
- 49 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 50 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Police Pension Plan which is a single-employer pension plan; and the Firefighters’
Pension Plan which is also a single-employer pension plan. The benefits, benefit
levels, employee contributions and employer contributions for the Police and
Firefighters’ Pension Plans are governed by Illinois Compiled Statutes (ILCS) and
can only be amended by the Illinois General Assembly. None of the pension plans
issue separate reports on the pension plans. The Morton Grove Public Library also
participates in IMRF and MERF. A portion of the liability for each plan relates to the
library.
Illinois Municipal Retirement Fund (IMRF)
IMRF provides retirement, disability, annual cost of living adjustments and death
benefits to plan members and beneficiaries. IMRF acts as a common investment and
administrative agent for local governments and school villages in Illinois. The
Illinois Pension Code establishes the benefit provisions of the plan that can only be
amended by the Illinois General Assembly.
IM RF issues a financial report that includes financial statements and required
supplementary information. The report may be obtained at
www.imrf.org/pubs/pubs_homepage.htm or by writing to the Illinois Municipal
Retirement Fund, 2211 York Road, Suite 500, Oak Brook, Illinois 60523.
All employees (other than those covered by the Police or Firefighters’ Pension Plans)
hired in positions that meet or exceed the prescribed annual hourly standard must be
enrolled in IMRF effective January 1, 2005, as participating members. IMRF
provides two tiers of pension benefits. Employees hired prior to January 1, 2011, are
eligible for Tier 1 benefits. For Tier 1 employees, pension benefits vest after eight
years of service. Participating members who retire at age 55 (reduced benefits) or
after age 60 (full benefits) with eight years of credited service are entitled to an
annual retirement benefit, payable monthly for life, in an amount equal to 1 2/3% of
their final rate of earnings, for each year of credited service up to 15 years and 2% for
each year thereafter.
Employees hired on or after January 1, 2011, are eligible for Tier 2 benefits. For
Tier 2 employees, pension benefits vest after ten years of service. Participating
members who retire at age 62 (reduced benefits) or after age 67 (full benefits) with
ten years of credited service are entitled to an annual retirement benefit, payable
monthly for life, in an amount equal to 1 2/3% of their final rate of earnings, for each
year of credited service up to 15 years and 2% for each year thereafter. Participating
members are required to contribute 4.50% of their annual salary to IMRF. The
Village is required to contribute the remaining amounts necessary to fund IMRF as
specified by statute. The employer contribution for the year ended December 31,
2014 was 9.73% of covered payroll.
- 50 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 51 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Illinois Municipal Retirement Fund (IMRF) (Continued)
For December 31, 2014, the Village’s annual pension cost of $365,000 was equal to
the Village’s required and actual contributions. The required contribution was
determined as part of the December 31, 2012 actuarial valuation using the entry-age
actuarial cost method. The actuarial assumptions included (a) 7.5% investment rate
of return (net of administrative expenses); (b) projected salary increases of 4% a year,
attributable to inflation; (c) additional projected salary increases ranging from
0.4% to 10.0% per year depending on age and service, attributable to seniority/merit;
and (d) postretirement benefit increases of 3% annually. The actuarial value of IMRF
assets was determined using techniques that smooth the effects of short-term
volatility in the market value of investments over a five-year period with a 20%
corridor. IMRF’s unfunded actuarial accrued liability is being amortized as a level
percentage of projected payroll on an open basis. The amortization period at
December 31, 2012 was 29 years.
Sheriff’s Law Enforcement Personnel (SLEP)
Sheriff’s Law Enforcement Personnel (SLEP) having accumulated at least 30 years
of SLEP service and terminating IMRF participation on or after July 1, 1988, may
elect to retire at or after age 50 with no early retirement discount penalty. SLEP
members meeting these two qualifications are entitled to an annual retirement
benefit, payable monthly for life, in an amount equal to 2.5% of their final rate of
earnings, for each year of credited service up to 20 years, 2% of their final earnings
rate for the next ten years of credited service and 1% for each year thereafter. For
those SLEP members retiring with less than 20 years of SLEP service, the regular
IMRF pension formula applies. SLEP also provides death and disability benefits.
These benefit provisions and all other requirements are established by state statutes.
SLEP members are required to contribute 7.5% of their annual salary to SLEP. The
Village is required to contribute the remaining amounts necessary to fund it as
specified by statute. The employer contribution rate for the calendar year ended 2014
was 13.75% of covered payroll.
Municipal Employees’ Retirement Fund (MERF)
All employees (other than those covered by the Police or Firefighters’ plans) hired in
positions that meet or exceed the prescribed annual hourly standard (1,000 hours)
were enrolled in MERF as participating members through January 1, 2005. The plan
is closed to new members. Pension benefits vest after ten years of service.
Participating members who retire after 30 years of creditable service or at or after age
60 with five years of credited service are entitled to an annual retirement benefit,
payable monthly for life, in an amount equal to 1 2/3% of average compensation for
each of the first 15 years of service, plus 2% of average compensation for each year
- 51 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 52 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Municipal Employees’ Retirement Fund (MERF) (Continued)
of service in excess of 15 years. Average compensation is defined as the average of
the four calendar years (within the preceding ten years of participation) during which
the participant received the highest compensation. Participating members are
required to contribute 2% of their annual salary to MERF. The Village is required to
contribute the remaining amounts necessary to fund MERF as specified by the plan.
The employer contribution for the year ended December 31, 2014 was 30.61% of
covered payroll.
At December 31, 2014, MERF membership consisted of:
Retirees and beneficiaries currently receiving benefits 21
Terminated employees entitled to benefits but not
yet receiving them -
Active employees 28
Inactive employees 21
TOTAL 70
Investment Policy
MERF’s investment policy in accordance with ILCS establishes the following target
allocation across asset classes:
Asset Class
Target
Long-Term
Expected Real
Rate of Return
Domestic Equities 100% 6.45%
The long-term expected rate of return on MERF’s investments was determined using
a building block method conducted by MERF’s actuary in which best estimate ranges
of expected future real rates of return (net of pension plan investment expense and
inflation) were developed for each major assets class. These ranges were combined to
produce the long-term expected rate of return by weighting the expected future real
rates of return by the target asset allocation percentage and by adding expected
inflation. Best estimates of arithmetic real rates of return for each major asset class
included in MERF’s target asset allocation as of December 31, 2014 are listed in the
table above.
- 52 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 53 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Municipal Employees’ Retirement Fund (MERF) (Continued)
Investment Rate of Return
For the year ended December 31, 2014, the annual money-weighted rate of return on
MERF plan investments, net of pension plan investment expense, was 2.80%. The
money-weighted rate of return expresses investment performance, net of investment
expense, adjusted for the changing amounts actually invested.
Summary of Significant Accounting Policies and Plan Asset Matters
The financial statements are prepared using the accrual basis of accounting.
Employee and employer contributions are recognized as revenues in the period in
which employee services are performed.
Investments are reported at fair value. Investment income is recognized as earned.
Gains and losses on sales and exchanges of fixed income securities are recognized on
the transaction date.
Police Pension Plan
Police sworn personnel are covered by the Police Pension Plan which is a defined
benefit single-employer pension plan. Although this is a single-employer pension
plan, the defined benefits and employee and employer contributions levels are
governed by Illinois Compiled Statutes (Chapter 40 - Article 5/3) and may be
amended only by the Illinois legislature. The Village accounts for the Police Pension
Plan as a pension trust fund. At December 31, 2014, the Police Pension Plan
membership consisted of:
Retirees and beneficiaries currently receiving benefits 52
Terminated employees entitled to benefits but not
yet receiving them -
Inactive members 10
Current employees
Vested 24
Nonvested 23
TOTAL 109
- 53 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 54 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Police Pension Plan (Continued)
Benefits Provided
The Police Pension Plan provides retirement benefits as well as death and disability
benefits. Tier 1 employees (those hired prior to January 1, 2011) attaining the age of
50 or older with 20 or more years of creditable service are entitled to receive an
annual retirement benefit equal to one-half of the salary attached to the rank held on
the last day of service, or for one year prior to the last day, whichever is greater. The
annual benefit shall be increased by 2.5% of such salary for each additional year of
service over 20 years up to 30 years to a maximum of 75% of such salary. Employees
with at least eight years but less than 20 years of credited service may retire at or
after age 60 and receive 2.5% of salary for each year of service. The monthly benefit
shall be increased annually, following the first anniversary date of retirement and be
paid upon reaching the age of at least 55 years, by 3% of the original pension and 3%
compounded annually thereafter.
Tier 2 employees (those hired on or after January 1, 2011) attaining the age of 55 or
older with ten or more years of creditable service are entitled to receive an annual
retirement benefit equal to the average monthly salary obtained by dividing the total
salary of the police officer during the 96 consecutive months of service within the
last 120 months of service in which the total salary was the highest by the number of
months of service in that period. Police officers’ salary for pension purposes is
capped at $106,800, plus the lesser of ½ of the annual change in the Consumer Price
Index or 3% compounded. The annual benefit shall be increased by 2.5% of such
salary for each additional year of service over 20 years up to 30 years to a maximum
of 75% of such salary. Employees with at least ten years may retire at or after age 50
and receive a reduced benefit (i.e., ½% for each month under 55). The monthly
benefit of a Tier 2 police officer shall be increased annually at age 60 on the January
1st after the police officer retires, or the first anniversary of the pension starting date,
whichever is later.
Contributions
Employees are required by ILCS to contribute 9.91% of their base salary to the
Police Pension Plan. If an employee leaves covered employment with less than 20
years of service, accumulated employee contributions may be refunded without
accumulated interest. The Village is required to contribute the remaining amounts
necessary to finance the plan and the administrative costs as actuarially determined
by an enrolled actuary. Effective January 1, 2011, the Village has until the year 2040
to fund 90% of the past service cost for the Police Pension Plan. For the year ended
December 31, 2014, the Village’s contribution was 45.63% of covered payroll.
- 54 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 55 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Police Pension Plan (Continued)
Investment Policy
ILCS limit the Police Pension Fund’s (the Fund) investments to those allowable by
ILCS and require the Fund’s Board of Trustees to adopt an investment policy which
can be amended by a majority vote of the Board of Trustees. The Fund’s investment
policy authorizes the Fund to make deposits/invest in insured commercial banks,
savings and loan institutions, obligations of the U.S. Treasury and U.S. agencies,
insured credit union shares, money market mutual funds with portfolios of securities
issued or guaranteed by the United States Government or agreements to repurchase
these same obligations, repurchase agreements, short-term commercial paper rated
within the three highest classifications by at least two standard rating services,
investment grade corporate bonds and Illinois Funds. The Fund may also invest in
certain non-U.S. obligations, Illinois municipal corporations tax anticipation
warrants, veteran’s loans, obligations of the State of Illinois and its political
subdivisions, Illinois insurance company general and separate accounts, mutual funds
and corporate equity securities and real estate investment trusts. During the year, the
following changes to the investment policy were approved by the Board of Trustees:
allowing investments in real estate investment trusts and the global tactical asset
allocation mutual fund. In addition, target allocations across asset classes were
adjusted.
The Fund’s investment policy, in accordance with ILCS, establishes the following
target allocation across asset classes:
Asset Class
Target
Long-Term
Expected
Rate of
Return
Inflation +
Expenses
Long-Term
Expected Real
Rate of
Return
Fixed Income 50.0% 2.5% 2.5% 0.0%
Large Cap Domestic Equities 32.5% 7.5% 2.5% 5.0%
Mid Cap Domestic Equities 5.0% 7.8% 2.5% 5.3%
Small Cap Domestic Equities 2.5% 8.0% 2.5% 5.5%
International Equities 10.0% 7.3% 2.5% 4.8%
- 55 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 56 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Police Pension Plan (Continued)
Investment Policy (Continued)
ILCS limit the Fund’s investments in equities, mutual funds and variable annuities to
65%. Securities in any one company should not exceed 5% of the total fund. The
blended asset class is comprised of all other asset classes to allow for rebalancing the
portfolio.
Investment Valuations
All investments in the plan are stated at fair value and are recorded as of the trade
date. Fair value is based on quoted market prices at December 31 for debt securities,
equity securities and mutual funds and contract values for insurance contracts.
Illinois Funds, an investment pool created by the state legislature under the control of
the State Treasurer, is a money market mutual fund that maintains a $1 per share
value.
Investment Concentrations
There are no significant investments (other than U.S. Government guaranteed
obligations) in any one organization that represent 5% or more of the Fund’s
investments.
Investment Rate of Return
For the year ended December 31, 2014, the annual money-weighted rate of return on
pension plan investments, net of pension plan investment expense, was 6.12%. The
money-weighted rate of return expresses investment performance, net of investment
expense, adjusted for the changing amounts actually invested.
Deposits with Financial Institutions
Custodial credit risk for deposits with financial institutions is the risk that in the
event of a bank’s failure, the Fund’s deposits may not be returned to them. The
Fund’s investment policy requires all bank balances to be covered by federal
depository insurance.
- 56 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 57 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Police Pension Plan (Continued)
Interest Rate Risk
The following table presents the investments and maturities of the Fund’s debt
securities as of December 31, 2014:
Investment Maturities (in Years)
Less More
Fair Value than 1 1-5 6-10 than 10
Municipal bonds $ 462,135 $ - $ - $ 462,135 $ -
U.S. Treasury obligations 3,872,675 - 3,281,164 488,259 103,252
U.S agency obligations 3,074,792 - 1,379,486 543,488 1,151,818
Corporate bonds 6,923,836 56,580 1,856,842 4,212,098 798,316
TOTAL $ 14,333,438 $ 56,580 $ 6,517,492 $ 5,705,980 $ 2,053,386
In accordance with its investment policy, the Fund limits its exposure to interest rate
risk by structuring the portfolio to provide liquidity for operating funds and
maximizing yields for funds not needed for expected current cash flows. The
investment policy does not limit the maximum maturity length of investments in the
Fund.
Credit Risk
The Fund limits its exposure to credit risk, the risk that the issuer of a debt security
will not pay its par value upon maturity, by primarily investing in obligations
guaranteed by the United States Government or securities issued by agencies of the
United States Government that are explicitly or implicitly guaranteed by the United
States Government or in municipal or corporate bonds. The government bond index
fund is not rated by the commercial ratings agencies. The range of quality ratings of
securities held in the fund is AA-BBB.
Custodial Credit Risk
Custodial credit risk for investments is the risk that, in the event of the failure of the
counterparty to the investment, the Fund will not be able to recover the value of its
investments that are in possession of an outside party.
To limit its exposure, the Fund requires all security transactions that are exposed to
custodial credit risk to be processed on a delivery versus payment (DVP) basis with
the underlying investments held by a third party acting as the Fund’s agent separate
from where the investment was purchased in the Fund’s name. The money market
mutual funds and equity mutual funds are not subject to custodial credit risk.
- 57 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 58 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Police Pension Plan (Continued)
Net Pension Liability
The components of the net pension liability of the Police Pension Plan as of
December 31, 2014 calculated in accordance with GASB Statement No. 67 were as
follows:
Total pension liability $ 59,527,590
Plan fiduciary net position 32,165,054
Village’s net pension liability 27,362,536
Plan fiduciary net position as a percentage
of the total pension liability
54%
See the schedule of changes in the employer’s net pension liability and related ratios
in the required supplementary information for additional information related to the
funded status of the Fund.
Actuarial Assumptions
The total pension liability above was determined by an actuarial valuation performed
as of December 31, 2014 using the following actuarial methods and assumptions.
Actuarial valuation date December 31,
2014
Actuarial cost method Entry-age
normal
Assumptions
Inflation 3.000%
Salary increases 4.500%
Interest rate 7.125%
Cost of living adjustments 3.000%
Asset valuation method Market
The RP-2000 Mortality Table with Blue Collar Adjustment, projected to 2014, was
used for retirement and survivor pensioners. For disability pensioners, the RP-2000
Mortality Table for Disabled Retirees, projected to 2014, was used.
- 58 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 59 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Police Pension Plan (Continued)
Discount Rate
The discount rate used to measure the total pension liability was 7.125%. The
projection of cash flows used to determine the discount rate assumed that member
contributions will be made at the current contribution rate and that the Village
contributions will be made at rates equal to the difference between actuarially
determined contribution rates and the member rate. Based on those assumptions, the
Fund’s fiduciary net position was projected to be available to make all projected
future benefit payments of current plan members.
Discount Rate Sensitivity
The following is a sensitive analysis of the net pension liability to changes in the
discount rate. The table below presents the pension liability of the Village calculated
using the discount rate of 7.125% as well as what the Village’s net pension liability
would be if it were calculated using a discount rate that is 1 percentage point lower
(6.125%) or 1 percentage point higher (8.125%) than the current rate:
1%
Decrease
Current
Discount Rate
1%
Increase
(6.125%) (7.125%) (8.125%)
Net pension liability $ 35,243,494 $ 27,362,536 $ 20,878,141
Firefighters’ Pension Plan
Plan Administration
Firefighter sworn personnel are covered by the Firefighters’ Pension Plan, a single-
employer defined benefit pension plan sponsored by the Village. The defined benefits
and employee and minimum employer contribution levels are governed by Illinois
Compiled Statutes (40 ILCS 5/4-101) and may be amended only by the Illinois
legislature. The Village accounts for the Firefighters’ Pension Plan as a pension trust
fund.
The plan is governed by a five-member Board of Trustees. Two members of the
Board are appointed by the Village President, one member is elected by pension
beneficiaries and two members are elected by active firefighter employees.
- 59 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 60 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Firefighters’ Pension Plan (Continued)
Plan Membership
At December 31, 2014, the measurement date, membership consisted of:
Inactive plan members currently receiving
benefits 42
Inactive plan members entitled to but not
yet receiving benefits 3
Employees
Vested 31
Nonvested 10
TOTAL 86
Benefits Provided
The following is a summary of benefits of the plan as provided for in ILCS:
The Firefighters’ Pension Plan provides retirement benefits as well as death and
disability benefits. Tier 1 employees (those hired prior to January 1, 2011) attaining
the age of 50 or older with 20 or more years of creditable service are entitled to
receive an annual retirement benefit equal to one-half of the salary attached to the
rank held at the date of retirement.
The annual benefit shall be increased by 2.5% of such salary for each additional year
of service over 20 years up to 30 years to a maximum of 75% of such salary.
Employees with at least ten years but less than 20 years of credited service may retire
at or after age 60 and receive a reduced benefit. The monthly benefit shall be
increased annually, following the first anniversary date of retirement and be paid
upon reaching the age of at least 55 years, by 3% of the original pension and 3%
compounded annually thereafter.
Investment Policy
Permitted Deposits and Investments - Statutes and the Firefighter’s Pension Fund’s
(the Fund) investment policy authorize the Fund to make deposits/invest in insured
commercial banks, savings and loan institutions, obligations of the U.S. Treasury and
U.S. agencies, insured credit union shares, money market mutual funds with
- 60 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 61 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Firefighters’ Pension Plan (Continued)
Investment Policy (Continued)
portfolios of securities issued or guaranteed by the United States Government or
agreements to repurchase these same obligations, repurchase agreements, short-term
commercial paper rated within the three highest classifications by at least two
standard rating services, investment grade corporate bonds and Illinois Funds. The
Fund may also invest in certain non-U.S. obligations, Illinois municipal corporations
tax anticipation warrants, veteran’s loans, obligations of the State of Illinois and its
political subdivisions, Illinois insurance company general and separate accounts,
mutual funds and corporate equity securities. During the year, the following changes
to the investment policy were approved by the Board of Trustees: allowing
investments in real estate investment trusts and the global tactical asset allocation
mutual fund. In addition, target allocations across asset classes were adjusted.
The Fund’s investment policy in accordance with ILCS establishes the following
target allocation across asset classes:
Asset Class
Target
Long-Term
Expected
Rate of
Return
Inflation +
Expenses
Long-Term
Expected Real
Rate of
Return
Large Cap Domestic Equities 26% 10.1% 3.25% 6.9%
Small Cap Domestic Equities 9% 11.7% 3.25% 8.5%
International Equities 10% 10.8% 3.25% 7.6%
Fixed Income 55% 5.3% 3.25% 2.1%
ILCS limit the Fund’s investments in equities, mutual funds and variable annuities to
65%. Securities in any one company should not exceed 5% of the total fund. The
blended asset class is comprised of all other asset classes to allow for rebalancing the
portfolio.
The long-term expected rate of return on the Fund’s investments was determined
using an asset allocation study conducted by the Fund’s investment management
consultant in which best estimate ranges of expected future real rates of return (net of
pension plan investment expense and inflation) were developed for each major assets
- 61 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 62 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Firefighters’ Pension Plan (Continued)
Investment Policy (Continued)
class. These ranges were combined to produce the long-term expected rate of return
by weighting the expected future real rates of return by the target asset allocation
percentage and by adding expected inflation. Best estimates or arithmetic real rates of
return excluding inflation for each major asset class included in the Fund’s target
asset allocation as of December 31, 2014 are listed in the table above.
Concentrations
There are no significant investments (other than U.S. Government guaranteed
obligations) in any one organization that represent 5% or more of the Fund’s
investments.
Rate of Return
For the year ended December 31, 2014, the annual money-weighted rate of return on
pension plan investments, net of pension plan investment expense, was 6%. The
money-weighted rate of return expresses investment performance, net of investment
expense, adjusted for the changing amounts actually invested.
Deposits with Financial Institutions
Custodial credit risk for deposits with financial institutions is the risk that in the
event of a bank’s failure, the Fund’s deposits may not be returned to them. The
Fund’s investment policy requires all bank balances to be covered by federal
depository insurance.
Interest Rate Risk
The following table presents the investments and maturities of the Fund’s debt
securities as of December 31, 2014:
Investment Maturities (in Years)
Less More
Fair Value than 1 1-5 6-10 than 10
Municipal bonds $ 112,410 $ - $ - $ 112,410 $ -
U.S. Treasury obligations 2,582,938 152,695 2,103,149 327,094 -
U.S agency obligations 11,968,688 725,193 4,706,529 6,375,851 161,115
TOTAL $ 14,664,036 $ 877,888 $ 6,809,678 $ 6,815,355 $ 161,115
- 62 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 63 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Firefighters’ Pension Plan (Continued)
Interest Rate Risk (Continued)
In accordance with its investment policy, the Fund limits its exposure to interest rate
risk by structuring the portfolio to provide liquidity for operating funds and
maximizing yields for funds not needed for expected current cash flows. The
investment policy does not limit the maximum maturity length of investments in the
Fund.
Credit Risk
The Fund limits its exposure to credit risk, the risk that the issuer of a debt security
will not pay its par value upon maturity, by primarily investing in obligations
guaranteed by the United States Government or securities issued by agencies of the
United States Government that are explicitly or implicitly guaranteed by the United
States Government. The municipal bonds and the U.S. Treasury obligations are not
rated by Standard and Poor’s. The ratings for the U.S. agency investments all were
rated AA+.
Custodial Credit Risk
Custodial credit risk for investments is the risk that, in the event of the failure of the
counterparty to the investment, the Fund will not be able to recover the value of its
investments that are in possession of an outside party. To limit its exposure, the
Fund’s investment policy requires all security transactions that are exposed to
custodial credit risk to be processed on a delivery versus payment (DVP) basis with
the underlying investments held by a third party acting as the Fund’s agent separate
from where the investment was purchased or by the trust department of the bank
where purchased, in the Fund’s name. Illinois Funds and the money market mutual
funds are not subject to custodial credit risk.
- 63 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 64 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Firefighters’ Pension Plan (Continued)
Net Pension Liability
The components of the net pension liability of the Firefighters’ Pension Plan as of
December 31, 2014 were as follows:
Total pension liability $ 54,645,387
Plan fiduciary net position 29,959,420
Village’s net pension liability 24,685,967
Plan fiduciary net position as a percentage
of the total pension liability
54.8%
See the schedule of changes in the employer’s net pension liability and related ratios
in the required supplementary information for additional information related to the
funded status of the Fund.
Actuarial Assumptions
The total pension liability above was determined by an actuarial valuation performed
as of December 31, 2014 using the following actuarial methods and assumptions.
Actuarial valuation date December 31,
2014
Actuarial cost method Entry-age
normal
Assumptions
Inflation 3.00%
Salary increases 5.50%
Interest rate 6.75%
Cost of living adjustments 3.00%
Asset valuation method Market
The RP-2000 Mortality Table with Blue Collar Adjustment, projected to 2014, was
used for retirement and survivor pensioners. For disability pensioners, the RP-2000
Mortality Table for Disabled Retirees, projected to 2014, was used.
- 64 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 65 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
a. Plan Descriptions (Continued)
Firefighters’ Pension Plan (Continued)
Discount Rate
The discount rate used to measure the total pension liability was 7.125%. The
projection of cash flows used to determine the discount rate assumed that member
contributions will be made at the current contribution rate and that the Village
contributions will be made at rates equal to the difference between actuarially
determined contribution rates and the member rate. Based on those assumptions, the
Fund’s fiduciary net position was projected to be available to make all projected
future benefit payments of current plan members.
Discount Rate Sensitivity
The following is a sensitive analysis of the net pension liability to changes in the
discount rate. The table below presents the pension liability of the Village calculated
using the discount rate of 7.125% as well as what the Village’s net pension liability
would be if it were calculated using a discount rate that is 1 percentage point lower
(6.125%) or 1 percentage point higher (8.125%) than the current rate:
1%
Decrease
Current
Discount Rate
1%
Increase
(6.125%) (7.125%) (8.125%)
Net pension liability $ 31,740,227 $ 24,685,967 $ 18,824,249
b. Significant Investments
There are no significant investments (other than U.S. Government guaranteed
obligations) in any one organization that represent 5% or more of plan net assets for
the Municipal Employees’ Retirement Fund, Police Pension Fund and the
Firefighters’ Pension Plan. Information for IMRF is not available.
- 65 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 66 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
c. Annual Pension Costs
Employer contributions have been determined as follows:
Illinois
Municipal
Retirement
Sheriff’s Law
Enforcement
Personnel
Actuarial valuation date December 31,
2012
December 31,
2012
Actuarial cost method Entry-age
Normal
Entry-age
Normal
Asset valuation method 5 Year
Smoothed
Market
5 Year
Smoothed
Market
Amortization method Level
Percentage of
Payroll
Level
Percentage of
Payroll
Amortization period 29 Years,
Open
30 Years,
Open
Significant actuarial assumptions
a) Rate of return on 7.50% 7.50%
present and future assets Compounded
Annually
Compounded
Annually
b) Projected salary increase 4.00% 4.00%
attributable to inflation Compounded
Annually
Compounded
Annually
c) Additional projected salary
increases - seniority/merit
0.40% to
10.00%
0.40% to
10.00%
d) Postretirement benefit
increases
3.00% 3.00%
- 66 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 67 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
c. Annual Pension Cost (Continued)
Municipal
Employees’
Retirement
Police
Pension
Firefighters’
Pension
Actuarial valuation date December 31,
2013
December 31,
2013
December 31,
2013
Actuarial cost method Projected
Unit Credit
Entry-age
Normal
Entry-age
Normal
Asset valuation method Market Smoothed
Market
Smoothed
Market
Amortization method Level Percentage
of Payroll
Level
Percentage of
Payroll
Level
Percentage of
Payroll
Amortization period 27 Years,
Closed
27 Years,
Closed
27 Years,
Closed
Significant actuarial assumptions
a) Rate of return on 7.00% to 7.50% 7.125% 7.125%
present and future assets Pre/Postretirement Compounded Compounded
Compounded Annually Annually
Annually
b) Projected salary increase - 3.50% to 4.50% 4.50% 4.50%
attributable to inflation Compounded Compounded Compounded
Annually Annually Annually
c) Additional projected salary 1.00% 1.00% 1.00%
increases - seniority/merit
d) Postretirement benefit
increases
None 3.00% 3.00%
- 67 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 68 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
c. Annual Pension Cost (Continued)
The Village’s annual pension cost and net pension obligation (asset) for the current
year ended December 31, 2014 were as follows:
Municipal
Employees’
Retirement
Police
Pension
Firefighters’
Pension
Annual required contributions $ 919,720 $ 2,114,444 $ 2,180,622
Interest on net pension obligation 72,596 537,754 584,856
Adjustment to annual required contribution (83,390) (435,417) (473,556)
Annual pension cost 908,926 2,216,781 2,291,922
Contributions made 646,269 1,746,014 1,914,705
Change in net pension obligation 262,657 470,767 377,217
Net pension obligation, beginning of year 1,037,083 7,547,426 8,208,511
NET PENSION OBLIGATION,
END OF YEAR
$ 1,299,740
$ 8,018,193
$ 8,585,728
d. Trend Information
Trend information gives an indication of the progress made in accumulating
sufficient assets to pay benefits when due.
Fiscal
Year
Illinois
Municipal
Retirement
Sheriff’s Law
Enforcement
Personnel
Municipal
Employees’
Retirement
Police
Pension
Firefighters’
Pension
Annual pension cost 2012 $ 282,054 $ 3,258 $ 667,127 $ 1,986,779 $ 2,174,011
(APC) 2013 327,895 2,323 712,771 2,066,963 2,257,271
2014 365,000 1,536 908,926 2,216,781 2,291,922
Actual contribution 2012 $ 282,054 $ 3,258 $ 572,810 $ 1,568,911 $ 1,775,057
2013 327,895 2,323 450,010 1,513,592 1,712,014
2014 365,000 1,536 646,269 1,746,014 1,914,705
Percentage of APC 2012 100.00% 100.00% 85.86% 78.97% 81.65%
contributed 2013 100.00% 100.00% 63.14% 73.23% 75.84%
2014 100.00% 100.00% 71.10% 78.76% 83.54%
Net pension obligation 2012 $ - $ - $ 774,322 $ 6,994,055 $ 7,663,254
(asset) 2013 - - 1,037,083 7,547,426 8,208,511
2014 - - 1,299,740 8,018,193 8,585,728
- 68 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 69 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
e. Funded Status and Funding Progress
The funded status and funding progress of the plans as of December 31, 2014 were as
follows:
Illinois
Municipal
Retirement
Sheriff’s Law
Enforcement
Personnel
Municipal
Employees’
Retirement
Police
Pension
Firefighters’
Pension
Actuarial accrued liability (AAL) $ 4,914,441 $ - $ 18,959,198 $ 59,527,590 $ 54,645,387
Actuarial value of plan assets 3,593,104 (8,068)* 8,338,149 32,165,054 29,959,420
Unfunded actuarial accrued
liability (UAAL)
1,321,337
8,068
10,621,049
27,362,536
24,685,967
Funded ratio (actuarial value of
plan assets/AAL)
73.11%
0.00%
44.00%
54.03%
54.83%
Covered payroll (active plan
members)
$ 3,751,280
$ -
$ 2,155,042
$ 4,017,422
$ 3,707,686
UAAL as a percentage of covered
payroll
35.22%
0.00%
492.80%
681.10%
665.81%
* The actuarial value of assets is negative as member benefits paid have exceeded
employer contributions; the amount relates to a former employee whose retirement
benefits were set by Sheriff’s Law Enforcement Personnel and had not been
adequately funded by a prior employer before employment with the Village.
f. Pension Fund Disclosures
Plan Net Position
Municipal
Employees’
Retirement
Police
Pension
Firefighters’
Pension
Total
ASSETS
Cash and cash equivalents $ - $ 584,811 $ 565,361 $ 1,150,172
Investments
Equities - 17,145,182 14,002,302 31,147,484
Equity mutual funds - - 699,016 699,016
Corporate bonds - 6,923,836 - 6,923,836
Annuity contracts 9,922,658 - - 9,922,658
U.S. Treasury obligations - 3,872,675 2,582,938 6,455,613
U.S. agency obligations - 3,074,792 11,968,688 15,043,480
Municipal bonds - 462,135 112,410 574,545
- 69 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 70 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
f. Pension Fund Disclosures (Continued)
Plan Net Position (Continued)
Municipal
Employees’
Retirement
Police
Pension
Firefighters’
Pension
Total
ASSETS (Continued)
Receivables $ - $ - $ - $ -
Accrued interest - 108,939 69,640 178,579
Other - 3,278 13,871 17,149
Due from primary government 2,266 - - 2,266
Prepaid Items - 4,129 2,134 6,263
Total assets 9,924,924 32,179,777 30,016,360 72,121,061
LIABILITIES
Accounts payable - 14,723 56,940 71,663
Total liabilities - 14,723 56,940 71,663
NET POSITION HELD IN TRUST
FOR PENSION BENEFITS
$ 9,924,924
$ 32,165,054
$ 29,959,420
$ 72,049,398
Changes in Plan Net Position
Municipal
Employees’
Retirement
Police
Pension
Firefighters’
Pension
Total
ADDITIONS
Contributions
Employer $ 795,018 $ 1,746,014 $ 1,914,705 $ 4,455,737
Employee 43,117 399,590 376,279 818,986
Total contributions 838,135 2,145,604 2,290,984 5,274,723
Investment income
Net appreciation in fair
value of investments - 1,912,369 720,914 2,633,283
Interest 303,004 109,453 1,066,726 1,479,183
Total investment income 303,004 2,021,772 1,787,640 4,112,466
Less investment expense (22,747) (49,641) (91,805) (164,193)
Net investment income 280,257 1,972,181 1,695,835 3,948,273
Total additions 1,118,392 4,117,785 3,986,819 9,222,996
- 70 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 71 -
12. DEFINED BENEFIT PENSION PLANS (Continued)
f. Pension Fund Disclosures (Continued)
Changes in Plan Net Position (Continued)
Municipal
Employees’
Retirement
Police
Pension
Firefighters’
Pension
Total
DEDUCTIONS
Retirement benefits $ 849,568 $ 2,662,038 $ 1,621,126 $ 5,132,732
Duty/nonduty disability benefits - 140,768 540,475 681,243
Surviving spouse benefits - 273,059 279,652 552,711
Refunds - 208,308 - 208,308
Administrative expenses - 47,891 42,228 90,119
Total deductions 849,568 3,332,064 2,483,481 6,665,113
NET INCREASE 268,824 785,721 1,503,338 2,557,883
NET POSITION HELD IN TRUST
FOR PENSION BENEFITS
January 1 9,656,100 31,379,333 28,456,082 69,491,515
December 31 $ 9,924,924 $ 32,165,054 $ 29,959,420 $ 72,049,398
13. SUBSEQUENT EVENTS
The Village issued $10,010,000 of General Obligation Bonds, Series 2015. These bonds
are dated March 18, 2015 due in annual installments of $555,000 to $1,840,000 plus
interest at 4% to 5% due on June 15 and December 15 of each year. These bonds were
issued for general municipal improvements, equipment purchases and to refund $6,120,000
of the Village’s General Obligation Bonds, Series 2007.
- 71 -
REQUIRED SUPPLEMENTARY INFORMATION
Original Final
Budget Budget Actual
REVENUES
Sales taxes 5,600,000$ 5,600,000$ 5,284,500$
Property taxes 8,674,373 8,674,373 8,785,779
Telecommunications taxes 900,000 900,000 781,166
Utility taxes 1,240,000 1,240,000 1,228,883
Other taxes 1,366,524 1,366,524 1,405,513
Licenses and permits 1,672,500 1,672,500 1,741,148
Intergovernmental
State income taxes 2,400,000 2,400,000 2,227,959
Local use taxes 390,000 390,000 454,615
Personal property replacement tax 377,900 377,900 363,561
Grants 145,000 145,000 176,894
Charges for services 900,350 900,350 814,935
Fines 788,000 788,000 827,515
Investment income 5,000 5,000 9,018
Cable TV franchise fees 330,000 330,000 340,991
Miscellaneous 356,550 356,550 258,667
Total revenues 25,146,197 25,146,197 24,701,144
EXPENDITURES
Current
General government 3,515,074 3,515,074 2,845,513
Public safety 17,006,163 17,006,163 17,397,217
Streets and sidewalks 2,397,875 2,397,875 3,028,264
Vehicle maintenance 745,735 745,735 793,103
Health and human services 318,050 318,050 282,897
Community development 183,200 183,200 189,709
Buildings and inspection services 862,990 862,990 790,256
Total expenditures 25,029,087 25,029,087 25,326,959
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 117,110 117,110 (625,815)
OTHER FINANCING SOURCES (USES)
Issuance of general obligation bonds - - 1,415,000
Proceeds from sale of capital assets 70,000 70,000 22,098
Transfers in 305,200 305,200 265,200
Transfers (out)(492,263) (492,263) (492,263)
Total other financing sources (uses)(117,063) (117,063) 1,210,035
NET CHANGE IN FUND BALANCE 47$ 47$ 584,220
FUND BALANCE, JANUARY 1 7,265,258
FUND BALANCE, DECEMBER 31 7,849,478$
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
GENERAL FUND
For the Year Ended December 31, 2014
(See independent auditor's report.)
- 72 -
Original and
Final Budget Actual
REVENUES
Property taxes 2,400,000$ 2,077,952$
Investment income 3,500 3,029
Miscellaneous - 17,000
Total revenues 2,403,500 2,097,981
EXPENDITURES
Current
Community development
Personal services 49,900 55,112
Commodities 6,450 3,248
Contractual services 208,810 195,747
Debt service
Principal retirement 510,000 510,000
Interest and fiscal charges 286,600 287,403
Capital outlay 4,702,500 2,522
Total expenditures 5,764,260 1,054,032
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (3,360,760) 1,043,949
OTHER FINANCING SOURCES (USES)
Transfer (out)(265,200) (265,200)
Proceeds from sale of capital assets 1,000,000 -
Total other financing sources (uses)734,800 (265,200)
NET CHANGE IN FUND BALANCE (2,625,960)$ 778,749
FUND BALANCE, JANUARY 1 13,493,724
FUND BALANCE, DECEMBER 31 14,272,473$
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
LEHIGH/FERRIS TAX INCREMENT FINANCING FUND
For the Year Ended December 31, 2014
(See independent auditor's report.)
- 73 -
Original and
Final Budget Actual
REVENUES
Property taxes 600,000$ 544,608$
Investment income 200 24
Total revenues 600,200 544,632
EXPENDITURES
Current
Community development
Professional services 20,950 1,346
Commodities 900,000 -
Debt service
Principal 702,912 702,912
Interest and fiscal charges 157,947 157,947
Capital outlay 350,000 47
Total expenditures 2,131,809 862,252
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (1,531,609) (317,620)
OTHER FINANCING SOURCES (USES)
Transfer (out)(40,000) -
Total other financing sources (uses)(40,000) -
NET CHANGE IN FUND BALANCE (1,571,609)$ (317,620)
FUND BALANCE (DEFICIT), JANUARY 1 (1,766,772)
FUND BALANCE (DEFICIT), DECEMBER 31 (2,084,392)$
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
WAUKEGAN ROAD TAX INCREMENT FINANCING FUND
For the Year Ended December 31, 2014
(See independent auditor's report.)
- 74 -
- 79 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2014
LEGAL COMPLIANCE AND ACCOUNTABILITY
a. Budgets
Budgets are adopted on a basis consistent with generally accepted accounting principles.
Annual appropriated budgets are adopted (at the department level) for the General, Special
Revenue, Debt Service, Capital Projects Funds on the modified accrual basis and for the
Enterprise and Pension Trust Funds on the accrual basis. The annual appropriated budget is
legally enacted and provides for a legal level of control at the fund level for all funds. All
annual appropriations lapse at fiscal year end.
All departments of the Village submit requests for appropriation to the Village
Administrator so that a budget ma y be prepared. The budget is prepared by fund and
includes information on the past year, current year estimates and requested appropriations
for the next fiscal year. All annual appropriations lapse at fiscal year end.
The proposed budget is presented to the governing body for review. The governing body
holds public hearings and may add to, subtract from or change appropriations, but may not
change the form of the budget.
The administrator is authorized to transfer budgeted amounts between departments within
the General Fund and at the fund level for all other funds; however, any revisions that alter
the total expenditures of any fund must be approved by the governing body. Expenditures
may not legally exceed budgeted appropriations at the fund level.
b. Excess of Actual Expenditures/Expenses over Budget in Individual Funds
The following funds had an excess of actual expenditures/expenses (exclusive of
depreciation and amortization) over budget for the fiscal year:
Fund Excess
General $ 297,872
Debt Service 14,024
Commuter Parking 7,651
9-1-1 Emergency Telephone System 839
Economic Development 272,846
- 75 -
(2)UAAL
Actuarial (4)as a
Actuarial (1)Accrued (3)Unfunded Percentage
Valuation Actuarial Liability Funded AAL (5)of Covered
Date Value of (AAL)Ratio (OAAL)Covered Payroll
December 31,Assets Entry-Age (1) / (2) (2) - (1)Payroll (4) / (5)
2009 1,263,960$ 1,928,193$ 65.55%664,233$ 2,536,985$ 26.18%
2010 1,587,107 2,412,574 65.78%825,467 2,676,109 30.85%
2011 1,918,661 2,717,120 70.61%798,459 2,732,396 29.22%
2012 2,414,956 3,164,935 76.30%749,979 2,765,233 27.12%
2013 2,938,288 3,904,677 75.25%966,389 3,195,858 30.24%
2014 3,593,104 4,914,441 73.11%1,321,337 3,751,280 35.22%
December 31, 2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF FUNDING PROGRESS
ILLINOIS MUNICIPAL RETIREMENT FUND
(See independent auditor's report.)
- 76 -
(6)
Underfunded
Actuarial
Accrued
(2)(4) Liability
(1)Actuarial Unfunded as a
Actuarial Actuarial Accrued (3)Actuarial (5)Percentage
Valuation Value of Liability Percentage Accrued Annual of Covered
Date Plan (AAL)Funded Liability Covered Payroll
December 31,Assets*Entry-Age (1) / (2) (2) - (1)Payroll (4) / (5)
2009 (21,320)$ -$ 0.00%21,320$ 69,944$ 30.48%
2010 (17,389) - 0.00%17,389 - 0.00%
2011 (21,917) - 0.00%21,917 - 0.00%
2012 (14,488) - 0.00%14,488 - 0.00%
2013 (9,485) - 0.00%9,485 - 0.00%
2014 (8,068) - 0.00%8,068 - 0.00%
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF FUNDING PROGRESS
SHERRIFF'S LAW ENFORCEMENT PERSONNEL PLAN
December 31, 2014
*The actuarial value of assets is negative as member benefits paid have exceeded employer contributions;the
amount relates to a former employee whose retirement benefits were set by Sheriff’s Law Enforcement Personnel
and had not been adequately funded by a prior employer before employment with the Village.
(See independent auditor's report.)
- 77 -
(2)UAAL
Actuarial as a
Actuarial (1)Accrued (3)(4)Percentage
Valuation Actuarial Liability Funded Unfunded (5)of Covered
Date Value of (AAL)Ratio AAL Covered Payroll
December 31,Assets Entry-Age (1) / (2) (2) - (1)Payroll (4) / (5)
2009 7,614,569$ 12,319,256$ 61.81%4,704,687$ 2,736,665$ 171.91%
2010 7,202,765 12,556,212 57.36%5,353,447 2,376,163 225.30%
2011 7,603,852 12,792,874 59.44%5,189,022 2,324,422 223.24%
2012 7,715,639 13,582,078 56.81%5,866,439 2,268,195 258.64%
2013 7,980,917 16,461,225 48.48%8,480,308 2,111,339 401.66%
2014 8,338,149 18,959,198 43.98%10,621,049 2,155,042 492.85%
December 31, 2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF FUNDING PROGRESS
MUNICIPAL EMPLOYEES' RETIREMENT FUND
Note:The projected unit credit actuarial cost method used for 2010 -2013.The entry-age normal actual cost method was
used for 2009 and 2014.
(See independent auditor's report.)
- 78 -
(2)UAAL
Actuarial as a
Actuarial (1)Accrued (3)(4)Percentage
Valuation Actuarial Liability Funded Unfunded (5)of Covered
Date Value of (AAL)Ratio AAL Covered Payroll
December 31,Assets Entry-Age (1) / (2) (2) - (1)Payroll (4) / (5)
2009 25,154,010$ 44,566,626$ 56.44%19,412,616$ 3,682,297$ 527.19%
2010 25,808,040 46,546,759 55.45%20,738,719 3,716,797 557.97%
2011 27,846,504 48,844,200 57.01%20,997,696 3,731,707 562.68%
2012 28,644,151 53,120,258 53.92%24,476,107 3,721,308 657.73%
2013 30,071,140 55,964,162 53.73%25,893,022 3,826,781 676.63%
2014 32,165,054 59,527,590 54.03%27,362,536 4,017,422 681.10%
December 31, 2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF FUNDING PROGRESS
POLICE PENSION FUND
(See independent auditor's report.)
- 79 -
(2)UAAL
Actuarial as a
Actuarial (1)Accrued (3)(4)Percentage
Valuation Actuarial Liability Funded Unfunded (5)of Covered
Date Value of (AAL)Ratio AAL Covered Payroll
December 31,Assets Entry-Age (1) / (2) (2) - (1)Payroll (4) / (5)
2009 22,359,358$ 42,331,261$ 52.82%19,971,903$ 3,390,072$ 589.13%
2010 22,797,325 46,237,636 49.30%23,440,311 3,331,623 703.57%
2011 24,618,965 48,531,925 50.73%23,912,960 3,358,576 712.00%
2012 25,997,209 50,222,856 51.76%24,225,647 3,564,271 679.68%
2013 27,567,617 52,834,148 52.18%25,266,531 3,648,645 692.49%
2014 29,959,420 54,645,387 54.83%24,685,967 3,707,686 665.81%
December 31, 2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF FUNDING PROGRESS
FIREFIGHTERS' PENSION FUND
(See independent auditor's report.)
- 80 -
(6)
Underfunded
Actuarial
Accrued
(2)(4) Liability
(1)Actuarial Unfunded as a
Actuarial Actuarial Accrued (3)Actuarial (5)Percentage
Valuation Value of Liability Percentage Accrued Annual of Covered
Date Plan (AAL)Funded Liability Covered Payroll
December 31,Assets Entry-Age (1) / (2) (2) - (1)Payroll (4) / (5)
2009 -$ 13,755,977$ 0.00%13,755,977$ 11,478,161$ 119.84%
2010 - 14,235,463 0.00%14,235,463 11,416,724 124.69%
2011 - 14,949,354 0.00%14,949,354 11,873,393 125.91%
2012 - 19,567,488 0.00%19,567,488 11,585,243 168.90%
2013 - 20,464,527 0.00%20,464,527 12,048,653 169.85%
2014 N/A N/A N/A N/A N/A N/A
N/A - Valuation not performed.
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF FUNDING PROGRESS
OTHER POSTEMPLOYMENT BENEFIT PLAN
December 31, 2014
(See independent auditor's report.)
- 81 -
Annual
Required
Calendar Employer Contribution Percentage
Year Contributions (ARC)Contributed
2009 239,238$ 239,238$ 100.00%
2010 245,399 245,399 100.00%
2011 271,600 271,600 100.00%
2012 282,054 282,054 100.00%
2013 327,895 327,895 100.00%
2014 365,000 365,000 100.00%
December 31, 2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EMPLOYER CONTRIBUTIONS
ILLINOIS MUNICIPAL RETIREMENT FUND
(See independent auditor's report.)
- 82 -
Annual
Required
Calendar Employer Contribution Percentage
Year Contributions (ARC)Contributed
2009 8,736$ 8,736$ 100.00%
2010 - - N/A
2011 - - N/A
2012 3,258 3,258 100.00%
2013 2,323 2,323 100.00%
2014 1,536 1,536 100.00%
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EMPLOYER CONTRIBUTIONS
SHERRIFF'S LAW ENFORCEMENT PERSONNEL PLAN
December 31, 2014
(See independent auditor's report.)
- 83 -
Fiscal Annual
Year Required
Ended Employer Contribution Percentage
December 31,Contributions (ARC)Contributed
2009 375,843$ 539,462$ 69.67%
2010 585,079 575,138 101.73%
2011 490,743 650,624 75.43%
2012 572,810 661,804 86.55%
2013 450,010 727,445 61.86%
2014 646,269 919,720 70.27%
VILLAGE OF MORTON GROVE, ILLINOIS
MUNICIPAL EMPLOYERS' RETIREMENT FUND
SCHEDULE OF EMPLOYER CONTRIBUTIONS
Last Ten Fiscal Years
(See independent auditor's report.)
- 84 -
2014
Actuarially determined contribution 2,114,444$
Contribution in relation to the actuarially
determined contribution 1,746,014
CONTRIBUTION DEFICIENCY (Excess)368,430$
Covered-employee payroll 4,017,422$
Contributions as a percentage of
covered-employee payroll 43.46%
The information directly above is formatted to comply with the requirements of GASB Statement No. 67.
Fiscal Annual
Year Required
Ended Employer Contribution Percentage
December 31,Contributions (ARC)Contributed
2009 1,390,415$ 1,644,689$ 84.54%
2010 1,488,481 1,819,161 81.82%
2011 1,845,746 2,008,262 91.91%
2012 1,568,911 1,862,314 84.25%
2013 1,513,592 1,942,614 77.92%
2014 1,746,014 2,114,444 82.58%
Notes to the Required Supplementary Information:
This information directly above is presented in accordance with GASB Statement No.25.The information presented was determined as part of the actuarial
valuations as of January 1 of the prior fiscal year.Additional information as of the latest actuarial valuation presented is as follows:the actuarial cost method
was entry-age normal;the amortization method was level percent of pay,closed and the amortization period was 26 years;the asset valuation method was at
market value;and the significant actuarial assumptions were an investment rate of return of 7.125%annually,projected salary increase assumption of 4.50%
compounded annually and postretirement benefit increases of 3.00% compounded annually.
VILLAGE OF MORTON GROVE, ILLINOIS
POLICE PENSION FUND
SCHEDULE OF EMPLOYER CONTRIBUTIONS
Last Ten Fiscal Years
(See independent auditor's report.)
- 85 -
2014
Actuarially determined contribution 2,180,622$
Contribution in relation to the actuarially
determined contribution 1,914,705
CONTRIBUTION DEFICIENCY (Excess)265,917$
Covered-employee payroll 3,707,686$
Contributions as a percentage of
covered-employee payroll 51.64%
The information directly above is formatted to comply with the requirements of GASB Statement No. 67.
Fiscal Annual
Year Required
Ended Employer Contribution Percentage
December 31,Contributions (ARC)Contributed
2009 1,582,849$ 1,794,274$ 88.22%
2010 1,646,123 1,931,791 85.21%
2011 2,047,228 2,216,735 92.35%
2012 1,775,057 2,054,683 86.39%
2013 1,712,014 2,140,182 79.99%
2014 1,914,705 2,180,622 87.81%
Notes to the Required Supplementary Information:
This information directly above is presented in accordance with GASB Statement No.25.The information presented was determined as part of the actuarial
valuations as of January 1 of the prior fiscal year.Additional information as of the latest actuarial valuation presented is as follows:the actuarial cost method
was entry-age normal;the amortization method was level percent of pay,closed and the amortization period was 26 years;the asset valuation method was at
market value;and the significant actuarial assumptions were an investment rate of return of 7.125%annually,projected salary increase assumption of 4.50%
compounded annually and postretirement benefit increases of 3.00% compounded annually.
VILLAGE OF MORTON GROVE, ILLINOIS
FIREFIGHTERS' PENSION FUND
SCHEDULE OF EMPLOYER CONTRIBUTIONS
Last Ten Fiscal Years
(See independent auditor's report.)
- 86 -
Annual
Required
Calendar Employer Contribution Percentage
Year Contributions (ARC)Contributed
2009 423,787$ 1,013,494$ 41.81%
2010 560,463 1,060,889 52.83%
2011 521,940 1,101,892 47.37%
2012 623,335 1,151,127 54.15%
2013 660,352 1,387,902 47.58%
2014 807,884 1,447,500 55.81%
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EMPLOYER CONTRIBUTIONS
OTHER POSTEMPLOYMENT BENEFIT PLAN
December 31, 2014
(See independent auditor's report.)
- 87 -
2014
TOTAL PENSION LIABILITY
Service cost 999,888$
Interest 4,067,424
Changes of benefit terms -
Differences between expected and actual experience 1,780,289
Changes of assumptions -
Benefit payments, including refunds of member contributions (3,284,173)
Net change in total pension liability 3,563,428
Total pension liability - beginning 55,964,162
TOTAL PENSION LIABILITY - ENDING 59,527,590$
PLAN FIDUCIARY NET POSITION
Contributions - employer 1,746,014$
Contributions - member 399,590
Net investment income 1,972,181
Benefit payments, including refunds of member contributions (3,284,173)
Administrative expense (47,891)
Net change in plan fiduciary net position 785,721
Plan net fiduciary position - beginning 31,379,333
PLAN NET FIDUCIARY POSITION - ENDING 32,165,054$
EMPLOYER'S NET PENSION LIABILITY 27,362,536$
Plan fiduciary net position
as a percentage of the total pension liability 54.00%
Covered-employee payroll 4,017,422$
Employer's net pension liability
as a percentage of covered-employee payroll 681.10%
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF CHANGES IN THE EMPLOYER'S
NET PENSION LIABILITY AND RELATED RATIOS
POLICE PENSION FUND
December 31, 2014
(See independent auditor's report.)
- 88 -
2014
TOTAL PENSION LIABILITY
Service cost 1,067,954$
Interest 3,811,312
Changes of benefit terms -
Differences between expected and actual experience (661,128)
Changes of assumptions -
Benefit payments, including refunds of member contributions (2,406,899)
Net change in total pension liability 1,811,239
Total pension liability - beginning 52,834,148
TOTAL PENSION LIABILITY - ENDING 54,645,387$
PLAN FIDUCIARY NET POSITION
Contributions - employer 1,914,705$
Contributions - member 376,279
Net investment income 1,695,835
Benefit payments, including refunds of member contributions (2,441,253)
Administrative expense (42,228)
Net change in plan fiduciary net position 1,503,338
Plan net fiduciary position - beginning 28,456,082
PLAN NET FIDUCIARY POSITION - ENDING 29,959,420$
EMPLOYER'S NET PENSION LIABILITY 24,685,967$
Plan fiduciary net position
as a percentage of the total pension liability 54.80%
Covered-employee payroll 3,707,686$
Employer's net pension liability
as a percentage of covered-employee payroll 665.80%
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF CHANGES IN THE EMPLOYER'S
NET PENSION LIABILITY AND RELATED RATIOS
FIREFIGHTERS' PENSION FUND
December 31, 2014
(See independent auditor's report.)
- 89 -
2014
Annual money-weighted rate of return,
net of investment expense 2.80%
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF INVESTMENT RETURNS
MUNICIPAL EMPLOYERS' RETIREMENT FUND
December 31, 2014
(See independent auditor's report.)
- 90 -
2014
Annual money-weighted rate of return,
net of investment expense 6.12%
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF INVESTMENT RETURNS
POLICE PENSION FUND
December 31, 2014
(See independent auditor's report.)
- 91 -
2014
Annual money-weighted rate of return,
net of investment expense 6.00%
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF INVESTMENT RETURNS
FIREFIGHTERS' PENSION FUND
December 31, 2014
(See independent auditor's report.)
- 92 -
COMBINING AND INDIVIDUAL FUND
FINANCIAL STATEMENTS AND SCHEDULES
MAJOR GOVERNMENTAL FUNDS
GENERAL FUND
The General Fund is used to account for resources traditionally associated with governments
which are accounted for in another fund. It receives a greater variety and amount of revenues and
finances a wider range of governmental activities than any other fund. Major functions financed
by the General Fund include:
Legislative Administrative
Legal Finance
Management Information Systems Police
Fire/ESDA Public Works
Vehicle Maintenance Solid Waste Disposal
Health and Human Services Community Development
Building and Inspectional Services
DEBT SERVICE FUND
The Debt Service Fund is used to account for the payment of governmental long-term debt. The
Debt Service Fund accounts for the principal and interest payments of all long-term debt incurred
by the Village, except for the Water Revenue Bonds and various installment notes, which are
accounted for in the Proprietary Fund.
CAPITAL PROJECTS FUND
The Capital Projects Fund is used to account for the financial resources used for major
infrastructure and other capital improvements (other than those financed by the Proprietary
Fund) within the Village. Bond issues used to finance a specific capital project, are separately
accounted for in this fund. The description of the Capital Projects Fund is as follows:
Capital Projects Fund - accounts for property taxes levied and other resources accumulated
primarily for major infrastructure and other capital improvements.
MAJOR GOVERNMENTAL FUNDS (Continued)
LEHIGH/FERRIS TAX INCREMENT FINANCING FUND
Lehigh/Ferris Tax Increment Financing Fund accounts for tax increment revenue and other
financial resources received along with the costs related to the Village’s Tax Increment
Financing (TIF) District. The fund entails the TIF District along Lehigh and Ferris Avenues. The
TIF District is authorized by state law and is created to promote redevelopment of certain parcels
declared as “blighted” into a higher and more productive land use.
WAUKEGAN ROAD TAX INCREMENT FINANCING FUND
The Waukegan Road Tax Increment Financing Fund accounts for tax increment revenue and
other financial resources received along with the costs related to the Village’s Tax Increment
Financing (TIF) District. The fund entails the TIF District along Waukegan Road. The TIF
District is authorized by state law and is created to promote redevelopment of certain parcels
declared as “blighted” into a higher and more productive land use.
Orignal Final 2013
Budget Budget Actual Actual
GENERAL GOVERNMENT
Legislative
Personal services 66,700$ 66,700$ 56,004$ 56,857$
Contractual services 47,150 47,150 36,457 31,645
Commodities 13,500 13,500 698 4,376
Total legislative 127,350 127,350 93,159 92,878
Administrative
Personal services 609,400 609,400 638,862 592,692
Contractual services 51,475 51,475 53,222 34,095
Commodities 3,000 3,000 2,599 4,402
Total administrative 663,875 663,875 694,683 631,189
Finance
Personal services 1,033,900 1,033,900 948,633 842,010
Contractual services 817,330 817,330 520,388 533,645
Commodities 9,000 9,000 4,132 7,281
Less administrative fees
Municipal Parking Fund (10,000) (10,000) (10,000) -
Water and Sewer Fund (150,000) (150,000) (150,000) (120,000)
Total finance 1,700,230 1,700,230 1,313,153 1,262,936
Management information services
Professional services 141,500 141,500 150,324 138,087
Contractual services 420,169 420,169 310,404 300,955
Capital outlay 60,100 60,100 27,832 55,124
Total management information services 621,769 621,769 488,560 494,166
Legal
Contractual services 202,850 202,850 114,808 124,887
Other expenditures
Other 199,000 199,000 141,150 377,861
Total other expenditures 199,000 199,000 141,150 377,861
Total general government 3,515,074 3,515,074 2,845,513 2,983,917
PUBLIC SAFETY
Police
Personal services 8,076,938 8,076,938 8,149,053 7,545,732
Contractual services 845,065 845,065 865,296 861,425
Commodities 136,265 136,265 132,471 124,720
Capital outlay 181,300 181,300 177,467 183,341
Total police 9,239,568 9,239,568 9,324,287 8,715,218
2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EXPENDITURES - BUDGET AND ACTUAL
GENERAL FUND
For the Year Ended December 31, 2014
(with prior year actual for 2013)
(This schedule is continued on the following pages.)
- 93 -
Orignal Final 2013
Budget Budget Actual Actual
PUBLIC SAFETY (Continued)
Fire
Personal services 7,313,182$ 7,313,182$ 7,556,399$ 7,091,707$
Contractual services 336,070 336,070 327,205 352,036
Commodities 102,728 102,728 102,531 110,623
Capital outlay - - 83,942 32,713
Total fire 7,751,980 7,751,980 8,070,077 7,587,079
Civil preparedness
Personal services 5,000 5,000 108 1,292
Contractual services 6,615 6,615 2,745 25,010
Commodities 3,000 3,000 - 752
Capital outlay - - - 2,498
Total civil preparedness 14,615 14,615 2,853 29,552
Total public safety 17,006,163 17,006,163 17,397,217 16,331,849
STREETS AND SIDEWALKS
Streets and sidewalks
Personal services 1,703,900 1,703,900 1,727,596 1,642,237
Contractual services 451,650 451,650 445,227 302,883
Commodities 154,875 154,875 146,691 107,878
Capital outlay - - 607,503 330,983
Less administrative fees
Motor Fuel Tax Fund (191,700) (191,700) (191,700) (180,000)
Commuter Parking Facility Fund (116,800) (116,800) (116,800) (105,000)
Total streets and sidewalks 2,001,925 2,001,925 2,618,517 2,098,981
Engineering
Personal services 362,200 362,200 400,177 333,112
Contractual services 29,400 29,400 6,354 11,687
Commodities 4,350 4,350 3,216 1,237
Total engineering 395,950 395,950 409,747 346,036
Total streets and sidewalks 2,397,875 2,397,875 3,028,264 2,445,017
VEHICLE MAINTENANCE
Personal services 304,200 304,200 307,211 297,719
Contractual services 77,500 77,500 80,169 191,231
Commodities 364,035 364,035 405,723 357,736
Total vehicle maintenance 745,735 745,735 793,103 846,686
HEALTH AND HUMAN SERVICES
Family and senior services
Personal services 133,600 133,600 121,522 124,411
Contractual services 167,850 167,850 147,965 152,432
Commodities 16,600 16,600 13,410 7,446
Total health and human services 318,050 318,050 282,897 284,289
(with prior year actual for 2013)
2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EXPENDITURES - BUDGET AND ACTUAL (Continued)
GENERAL FUND
For the Year Ended December 31, 2014
(This schedule is continued on the following page.)
- 94 -
Orignal Final 2013
Budget Budget Actual Actual
(with prior year actual for 2013)
2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EXPENDITURES - BUDGET AND ACTUAL (Continued)
GENERAL FUND
For the Year Ended December 31, 2014
COMMUNITY DEVELOPMENT
Personal services 155,400$ 155,400$ 177,415$ 131,818$
Contractual services 25,300 25,300 11,670 11,577
Commodities 2,500 2,500 624 176
Total community development 183,200 183,200 189,709 143,571
BUILDING AND INSPECTION SERVICES
Building and inspectional services
Personal services 456,100 456,100 429,659 263,668
Contractual services 71,320 71,320 32,467 79,374
Commodities 4,200 4,200 1,546 2,664
Capital outlay - - 26,480 -
Total building and inspectional services 531,620 531,620 490,152 345,706
Municipal buildings
Personal services 12,900 12,900 22,355 11,756
Contractual services 189,800 189,800 184,711 155,892
Commodities 6,500 6,500 5,540 1,654
Capital outlay 122,170 122,170 87,498 343,699
Total municipal buildings 331,370 331,370 300,104 513,001
Total building and inspection services 862,990 862,990 790,256 858,707
TOTAL EXPENDITURES 25,029,087$ 25,029,087$ 25,326,959$ 23,894,036$
(See independent auditor's report.)
- 95 -
Original and 2013
Final Budget Actual Actual
REVENUES
Property taxes 953,534$ 985,364$ 1,097,222$
Sales taxes 550,000 550,000 590,000
Intergovernmental 74,510 75,693 75,122
Investment income 500 880 450
Total revenues 1,578,544 1,611,937 1,762,794
EXPENDITURES
Debt service
Principal retirement 1,634,083 1,634,083 1,469,000
Interest and fiscal charges 323,805 337,829 305,031
Total expenditures 1,957,888 1,971,912 1,774,031
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (379,344) (359,975) (11,237)
OTHER FINANCING SOURCES (USES)
Transfers in 492,263 492,263 300,000
Total other financing sources (uses)492,263 492,263 300,000
NET CHANGE IN FUND BALANCE 112,919$ 132,288 288,763
FUND BALANCE (DEFICIT), JANUARY 1 (85,449) (374,212)
FUND BALANCE (DEFICIT), DECEMBER 31 46,839$ (85,449)$
2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
DEBT SERVICE FUND
For the Year Ended December 31, 2014
(with prior year actual for 2013)
(See independent auditor's report.)
- 96 -
Original and 2013
Final Budget Actual Actual
REVENUES
Property taxes 50,000$ 50,634$ 50,478$
Sales taxes 25,000 25,000 25,000
Intergovernmental
Personal property replacement tax 514,100 35,282 275,789
Investment income 5,000 1,311 3,852
Miscellaneous revenue - - 6,168
Total revenues 594,100 112,227 361,287
EXPENDITURES
General government
Contractual services - 124,145 -
Debt service
Interest and fiscal charges - - 900
Capital outlay
Capital projects
Capital acquisitions - - 1,050,830
Construction 1,212,500 296,422 2,254,719
Engineering 35,000 16,569 61,852
Total expenditures 1,247,500 437,136 3,368,301
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (653,400) (324,909) (3,007,014)
OTHER FINANCING SOURCES (USES)
Issuance of installment note - - 1,060,000
Total other financing sources (uses)- - 1,060,000
NET CHANGE IN FUND BALANCE (653,400)$ (324,909) (1,947,014)
FUND BALANCE, JANUARY 1 1,078,056 3,025,070
FUND BALANCE, DECEMBER 31 753,147$ 1,078,056$
2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
CAPITAL PROJECTS FUND
For the Year Ended December 31, 2014
(with prior year actual for 2013)
(See independent auditor's report.)
- 97 -
NONMAJOR GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS
Special Revenue Funds are used to account for the proceeds of specific revenue sources (other
than for major capital projects) that are legally restricted to expenditures for specific purposes.
Seven individual funds are reported within the Special Revenue Funds as follows:
Motor Fuel Tax Fund - accounts for monies received from the state levied tax on the sale of
fuels and the expenditures for capitalized construction, improvements or general maintenance
to the Village roadway system.
Commuter Parking Facility Fund - accounts for the cost of major improvements and general
maintenance to the commuter parking facility on Lehigh Avenue. Revenues are primarily
received from the daily parking fee imposed on the users of the facility.
9-1-1 Emergency Telephone System Fund - accounts for telephone surcharge fees collected
for the 9-1-1 emergency telephone system. The funds are to be disbursed for the purchase
and subsequent maintenance of that system.
Economic Development Fund - accounts for expenditures related to promoting economic
development throughout the Village. The fund also accounts for non-TIF redevelopment
costs including those that support an existing TIF but whose redevelopment is not directly
within a TIF established district.
Fire Alarm Fund - accounts for expenditures related to fire alarm costs for the Regional
Emergency Dispatch Center. The funds are to be disbursed for the purchase and subsequent
maintenance of fire alarms.
Seizure Fund - accounts for expenditures related to public safety. Revenues are primarily
received from the seizure of assets within the Village limits.
Dempster/Waukegan TIF Fund - accounts for expenditures related to promoting economic
redevelopment in the Prairie View Shopping Center within the Dempster/Waukegan TIF
District.
9-1-1
Commuter Emergency
Motor Parking Telephone
Fuel Tax Facility System
Cash and cash equivalents 868,891$ 60,576$ 15,077$
Investments - - -
Sales tax receivable - - -
Accounts, miscellaneous and
allotments receivable 58,599 - 63,266
TOTAL ASSETS 927,490$ 60,576$ 78,343$
LIABILITIES
Accounts payable and retainage payable 18,547$ 721$ 2,283$
Unearned revenue 48,749 - -
Due to other funds - - -
Advances from other funds - - -
Total liabilities 67,296 721 2,283
FUND BALANCES
Restricted for
Public safety - - 76,060
Highways and streets 860,194 - -
Committed for commuter improvements - 59,855 -
Unassigned (deficit)- - -
Total fund balances (deficit)860,194 59,855 76,060
TOTAL LIABILITIES AND
FUND BALANCES 927,490$ 60,576$ 78,343$
ASSETS
LIABILITIES AND FUND BALANCES
VILLAGE OF MORTON GROVE, ILLINOIS
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
December 31, 2014
Special Revenue Funds
- 98 -
Economic Fire Dempster/
Development Alarm Seizure Waukegan TIF Total
48,773$ 179,615$ 554,100$ -$ 1,727,032$
95,061 - - - 95,061
137,748 - - - 137,748
- - - - 121,865
281,582$ 179,615$ 554,100$ -$ 2,081,706$
55,823$ 4,283$ -$ 26,481$ 108,138$
- - - - 48,749
650,020 - - - 650,020
- - - 170,185 170,185
705,843 4,283 - 196,666 977,092
- 175,332 554,100 - 805,492
- - - - 860,194
- - - - 59,855
(424,261) - - (196,666) (620,927)
(424,261) 175,332 554,100 (196,666) 1,104,614
281,582$ 179,615$ 554,100$ -$ 2,081,706$
Special Revenue Funds
(See independent auditor's report.)
- 99 -
9-1-1
Commuter Emergency
Motor Parking Telephone
Fuel Tax Facility System
REVENUES
Sales taxes -$ -$ -$
Intergovernmental 734,506 - -
Surcharge fees - - 246,727
Charges for services - 145,953 -
Investment income 85 105 26
Total revenues 734,591 146,058 246,753
EXPENDITURES
Current
Public safety - - 250,839
Streets and sidewalks 512,324 191,851 -
Community development - - -
Total expenditures 512,324 191,851 250,839
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 222,267 (45,793) (4,086)
OTHER FINANCING SOURCES (USES)
Proceeds from sale of capital assets - - 7,010
Total other financing sources (uses)- - 7,010
NET CHANGE IN FUND BALANCES 222,267 (45,793) 2,924
FUND BALANCES (DEFICIT), JANUARY 1 637,927 105,648 73,136
FUND BALANCES (DEFICIT), DECEMBER 31 860,194$ 59,855$ 76,060$
COMBINING STATEMENT OF REVENUES, EXPENDITURES
VILLAGE OF MORTON GROVE, ILLINOIS
Special Revenue Funds
For the Year Ended December 31, 2014
NONMAJOR GOVERNMENTAL FUNDS
AND CHANGES IN FUND BALANCES
- 100 -
Economic Fire Dempster/
Development Alarm Seizure Waukegan TIF Total
554,355$ -$ -$ -$ 554,355$
- - 181,643 - 916,149
- - - - 246,727
- 178,987 - - 324,940
490 311 564 - 1,581
554,845 179,298 182,207 - 2,043,752
- 47,841 9,271 - 307,951
- - - - 704,175
802,402 - - 75,042 877,444
802,402 47,841 9,271 75,042 1,889,570
(247,557) 131,457 172,936 (75,042) 154,182
- - - - 7,010
- - - - 7,010
(247,557) 131,457 172,936 (75,042) 161,192
(176,704) 43,875 381,164 (121,624) 943,422
(424,261)$ 175,332$ 554,100$ (196,666)$ 1,104,614$
Special Revenue Funds
(See independent auditor's report.)
- 101 -
Original and 2013
Final Budget Actual Actual
REVENUES
Intergovernmental
Motor fuel taxes 546,845$ 576,464$ 569,363$
Miscellaneous 97,000 158,042 113,246
Investment income 50 85 142
Total revenues 643,895 734,591 682,751
EXPENDITURES
Streets and sidewalks
Materials 263,000 252,653 243,985
Lighting 80,000 67,971 69,440
Administrative fees
General Fund 191,700 191,700 180,000
Total expenditures 534,700 512,324 493,425
NET CHANGE IN FUND BALANCE 109,195$ 222,267 189,326
FUND BALANCE, JANUARY 1 637,927 448,601
FUND BALANCE, DECEMBER 31 860,194$ 637,927$
2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
MOTOR FUEL TAX FUND
For the Year Ended December 31, 2014
(with prior year actual for 2013)
(See independent auditor's report.)
- 102 -
Original and 2013
Final Budget Actual Actual
REVENUES
Charges for services 140,000$ 145,953$ 133,892$
Investment income 250 105 365
Total revenues 140,250 146,058 134,257
EXPENDITURES
Streets and sidewalks
Utilities and maintenance
of street lighting 39,200 45,866 76,624
Commodities 17,700 18,685 16,925
Administrative fees
General Fund 116,800 116,800 105,000
Water and Sewer Fund 10,500 10,500 10,500
Total expenditures 184,200 191,851 209,049
NET CHANGE IN FUND BALANCE (43,950)$ (45,793) (74,792)
FUND BALANCE, JANUARY 1 105,648 180,440
FUND BALANCE, DECEMBER 31 59,855$ 105,648$
2014
(with prior year actual for 2013)
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
COMMUTER PARKING FACILITY FUND
For the Year Ended December 31, 2014
(See independent auditor's report.)
- 103 -
Original and 2013
Final Budget Actual Actual
REVENUES
Telecommunications surcharges 250,000$ 246,727$ 249,121$
Investment income 100 26 46
Miscellaneous income - - 145,421
Total revenues 250,100 246,753 394,588
EXPENDITURES
Public safety
Contractual services 250,000 250,839 495,354
Total expenditures 250,000 250,839 495,354
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 100 (4,086) (100,766)
OTHER FINANCING SOURCES (USES)
Proceeds from sale of capital assets - 7,010 8,388
Total other financing sources (uses)- 7,010 8,388
NET CHANGE IN FUND BALANCE 100$ 2,924 (92,378)
FUND BALANCE, JANUARY 1 73,136 165,514
FUND BALANCE, DECEMBER 31 76,060$ 73,136$
2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
9-1-1 EMERGENCY TELEPHONE SYSTEM FUND
For the Year Ended December 31, 2014
(with prior year actual for 2013)
(See independent auditor's report.)
- 104 -
Original and 2013
Final Budget Actual Actual
REVENUES
Sales taxes 565,000$ 554,355$ 376,337$
Investment income 200 490 181
Total revenues 565,200 554,845 376,518
EXPENDITURES
Community development
Contractual services 479,556 802,402 486,543
Capital outlay 50,000 - -
Total expenditures 529,556 802,402 486,543
NET CHANGE IN FUND BALANCE 35,644$ (247,557) (110,025)
FUND BALANCE (DEFICIT), JANUARY 1 (176,704) (66,679)
FUND BALANCE (DEFICIT), DECEMBER 31 (424,261)$ (176,704)$
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
2014
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
ECONOMIC DEVELOPMENT FUND
For the Year Ended December 31, 2014
(with prior year actual for 2013)
(See independent auditor's report.)
- 105 -
Original and 2013
Final Budget Actual Actual
REVENUES
Charges for services 124,000$ 178,987$ 140,661$
Investment income 100 311 131
Total revenues 124,100 179,298 140,792
EXPENDITURES
Public safety
Personal services 19,800 18,938 18,347
Contractual services 36,400 28,903 25,790
Capital outlay 22,000 - 40,074
Total expenditures 78,200 47,841 84,211
NET CHANGE IN FUND BALANCE 45,900$ 131,457 56,581
FUND BALANCE (DEFICIT), JANUARY 1 43,875 (12,706)
FUND BALANCE, DECEMBER 31 175,332$ 43,875$
2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
FIRE ALARM FUND
For the Year Ended December 31, 2014
(with prior year actual for 2013)
(See independent auditor's report.)
- 106 -
Original and 2013
Final Budget Actual Actual
REVENUES
Intergovernmental 41,000$ 181,643$ 63,765$
Investment income 350 564 470
Total revenues 41,350 182,207 64,235
EXPENDITURES
Public safety
Contractual services 78,050 9,271 -
Total expenditures 78,050 9,271 -
NET CHANGE IN FUND BALANCE (36,700)$ 172,936 64,235
FUND BALANCE, JANUARY 1 381,164 316,929
FUND BALANCE, DECEMBER 31 554,100$ 381,164$
2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
SEIZURE FUND
For the Year Ended December 31, 2014
(with prior year actual for 2013)
(See independent auditor's report.)
- 107 -
Original and 2013
Final Budget Actual Actual
REVENUES
Property taxes 1,992,519$ -$ -$
Investment income 100 - -
Total revenues 1,992,619 - -
EXPENDITURES
Community development
Personnel services 18,500 18,162 -
Contractual services 96,400 56,880 8,650
Capital outlay 1,750,000 - -
Total expenditures 1,864,900 75,042 8,650
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 127,719 (75,042) (8,650)
NET CHANGE IN FUND BALANCE 127,719$ (75,042) (8,650)
FUND BALANCE (DEFICIT), JANUARY 1 (121,624) (112,974)
FUND BALANCE (DEFICIT), DECEMBER 31 (196,666)$ (121,624)$
2014
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
DEMPSTER/WAUKEGAN TIF FUND
For the Year Ended December 31, 2014
(with prior year actual for 2013)
(See independent auditor's report.)
- 108 -
NONMAJOR PROPRIETARY FUNDS
Solid Waste Fund - accounts for the operation of the Village waste collection services. All
activities necessary to provide such services mainly involve the collection and disposition of
waste and recyclable items.
Municipal Parking Fund - accounts for the operation of the Village parking lots and monies
received from permit sales. All activities necessary to provide such services are accounted for
in this fund, including but not limited to operations, maintenance and improvements.
Solid Municipal
Waste Parking Total
CURRENT ASSETS
Cash and cash equivalents 244,455$ 187,261$ 431,716$
Receivables 60,358 20,195 80,553
Prepaid expenses 40,464 - 40,464
Total current assets 345,277 207,456 552,733
Total assets 345,277 207,456 552,733
CURRENT LIABILITIES
Accounts payable 195,797 500 196,297
Unearned revenue - 57,760 57,760
Total current liabilities 195,797 58,260 254,057
Total liabilities 195,797 58,260 254,057
NET POSITION
Unrestricted 149,480 149,196 298,676
TOTAL NET POSITION 149,480$ 149,196$ 298,676$
NONMAJOR PROPRIETARY FUNDS
December 31, 2014
VILLAGE OF MORTON GROVE, ILLINOIS
COMBINING STATEMENT OF NET POSITION
(See independent auditor's report.)
- 109 -
Total
Solid Municipal Nonmajor
Waste Parking Enterprise
OPERATING REVENUES
Waste charges 1,983,404$ -$ 1,983,404$
Parking charges - 59,633 59,633
Total operating revenues 1,983,404 59,633 2,043,037
OPERATING EXPENSES
Contractual services and other charges 1,857,923 1,013 1,858,936
Commodities - 367 367
Administrative fees - 10,000 10,000
Total operating expenses 1,857,923 11,380 1,869,303
OPERATING INCOME 125,481 48,253 173,734
NON-OPERATING REVENUES
Interest income 325 404 729
CHANGE IN NET POSITION 125,806 48,657 174,463
NET POSITION, JANUARY 1 23,674 100,539 124,213
NET POSITION, DECEMBER 31 149,480$ 149,196$ 298,676$
VILLAGE OF MORTON GROVE, ILLINOIS
COMBINING STATEMENT OF REVENUES, EXPENSES
NONMAJOR PROPRIETARY FUNDS
For the Year Ended December 31, 2014
AND CHANGES IN NET POSITION
(See independent auditor's report.)
- 110 -
Solid Municipal
Waste Parking Total
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers and users 1,968,760$ 68,548$ 2,037,308$
Payments to suppliers (1,877,900) (10,880) (1,888,780)
Net cash from operating activities 90,860 57,668 148,528
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
None - - -
Net cash from noncapital
financing activities - - -
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES
None - - -
Net cash from capital and
related financing activities - - -
CASH FLOWS FROM INVESTING ACTIVITIES
Interest received 325 404 729
Net cash from investing activities 325 404 729
NET INCREASE IN CASH AND
CASH EQUIVALENTS 91,185 58,072 149,257
CASH AND CASH EQUIVALENTS, JANUARY 1 153,270 129,189 282,459
CASH AND CASH EQUIVALENTS, DECEMBER 31 244,455$ 187,261$ 431,716$
RECONCILIATION OF OPERATING INCOME TO NET
CASH FLOWS FROM OPERATING ACTIVITIES
Operating income 125,481$ 48,253$ 173,734$
Adjustments to reconcile operating income to net
cash from operating activities
Changes in operating assets and liabilities
Receivables (14,644) (725) (15,369)
Prepaid expenses (3,994) - (3,994)
Payables (15,983) 500 (15,483)
Unearned revenues - 9,640 9,640
NET CASH FROM OPERATING ACTIVITIES 90,860$ 57,668$ 148,528$
SCHEDULE OF NONCASH TRANSACTIONS
None -$ -$ -$
VILLAGE OF MORTON GROVE, ILLINOIS
COMBINING STATEMENT OF CASH FLOWS
NONMAJOR PROPRIETARY FUNDS
For the Year Ended December 31, 2014
(See independent auditor's report.)
- 111 -
FIDUCIARY FUNDS
PENSION TRUST FUNDS
Municipal Employees’ Retirement Fund - accounts for the accumulation of resources to be used
for retirement and disability pensions for the Village’s municipal employees.
Police Pension Fund - accounts for the accumulation of resources to be used for retirement and
disability pensions for the Village’s sworn police personnel. Most rules and regulations of the
fund are established by the pension division of the Illinois Department of Insurance.
Firefighters’ Pension Fund - accounts for the accumulation of resources to be used for retirement
and disability pensions for the Village’s sworn fire personnel. Most rules and regulations of the
fund are established by the pension division of the Illinois Department of Insurance.
VILLAGE OF MORTON GROVE, ILLINOIS
COMBINING STATEMENT OF PLAN NET POSITION
PENSION TRUST FUNDS
December 31, 2014
Municipal
Employees' Police Firefighters'
Retirement Pension Pension Total
Cash and cash equivalents -$ 584,811$ 565,361$ 1,150,172$
Investments, at fair value
Equitites - 17,145,182 14,002,302 31,147,484
Equity mutual funds - - 699,016 699,016
Corporate bonds - 6,923,836 - 6,923,836
Annuity contracts 9,922,658 - - 9,922,658
U.S. Treasury obligations - 3,872,675 2,582,938 6,455,613
U.S. agency obligations - 3,074,792 11,968,688 15,043,480
Municipal bonds - 462,135 112,410 574,545
Receivables
Accrued interest - 108,939 69,640 178,579
Other - 3,278 13,871 17,149
Due from primary government 2,266 - - 2,266
Prepaid expenses - 4,129 2,134 6,263
Total assets 9,924,924 32,179,777 30,016,360 72,121,061
LIABILITIES
Accounts payable - 14,723 56,940 71,663
Total liabilities - 14,723 56,940 71,663
NET POSITION HELD IN TRUST FOR
PENSION BENEFITS 9,924,924$ 32,165,054$ 29,959,420$ 72,049,398$
ASSETS
(See independent auditor's report.)
- 112 -
Municipal
Employees' Police Firefighters'2013
Retirement Pension Pension Total Actual
ADDITIONS
Contributions
Employer 795,018$ 1,746,014$ 1,914,705$ 4,455,737$ 3,792,981$
Employee 43,117 399,590 376,279 818,986 855,775
Total contributions 838,135 2,145,604 2,290,984 5,274,723 4,648,756
Investment income
Net appreciation in
fair value of investments - 1,912,369 720,914 2,633,283 5,913,299
Interest 303,004 109,453 1,066,726 1,479,183 999,715
Total investment income 303,004 2,021,822 1,787,640 4,112,466 6,913,014
Less investment expense (22,747) (49,641) (91,805) (164,193) (121,931)
Net investment income 280,257 1,972,181 1,695,835 3,948,273 6,791,083
Total additions 1,118,392 4,117,785 3,986,819 9,222,996 11,439,839
DEDUCTIONS
Retirement benefits 849,568 2,662,038 1,621,126 5,132,732 4,426,142
Duty/nonduty disability benefits - 140,768 540,475 681,243 685,367
Surviving spouse benefits - 273,059 279,652 552,711 541,179
Refunds - 208,308 - 208,308 3,608
Administrative expenses - 47,891 42,228 90,119 91,967
Total deductions 849,568 3,332,064 2,483,481 6,665,113 5,748,263
NET INCREASE 268,824 785,721 1,503,338 2,557,883 5,691,576
NET POSITION HELD IN TRUST
FOR PENSION BENEFITS
January 1 9,656,100 31,379,333 28,456,082 69,491,515 63,799,939
December 31 9,924,924$ 32,165,054$ 29,959,420$ 72,049,398$ 69,491,515$
2014
(with prior year actual for 2013)
VILLAGE OF MORTON GROVE, ILLINOIS
COMBINING STATEMENT OF CHANGES IN PLAN NET POSITION
PENSION TRUST FUNDS
For the Year Ended December 31, 2014
(See independent auditor's report.)
- 113 -
STATISTICAL SECTION (Unaudited)
This part of the Village of Morton Grove, Illinois’ comprehensive annual financial report
presents detailed information as a context for understanding what the information in the financial
statements, note disclosures and required supplementary information displays about the Village’s
overall financial health.
Contents Page(s)
Financial Trends
These schedules contain trend information to help the reader understand
how the Village’s financial performance and well-being have been changed
over time.
114-123
Revenue Capacity
These schedules contain information to help the reader assess the Village’s
most significant local revenue source, the property tax.
124-127
Debt Capacity
The schedules present information to help the reader assess the
affordability of the Village’s current levels of outstanding debt and the
Village’s ability to issue additional debt in the future.
128-131
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the
reader understand the environment within which the Village’s financial
activities take place.
132-133
Operating Information
These schedules contain service and infrastructure data to help the reader
understand how the information in the Village’s financial report relates to
the services the Village provides and the activities it performs.
134-136
Sources: Unless otherwise noted, the information in these schedules is derived from the
comprehensive annual financial reports for the relevant year.
Fiscal Year 2005 2006 2007 2008
GOVERNMENTAL ACTIVITIES
Net investment in capital assets 46,920,287$ 49,824,312$ 50,519,769$ 46,369,992$
Restricted 2,758,495 1,618,149 1,320,956 1,490,542
Unrestricted (18,915,303) (16,684,584) (15,865,423) (12,451,299)
TOTAL GOVERNMENTAL ACTIVITIES 30,763,479$ 34,757,877$ 35,975,302$ 35,409,235$
BUSINESS-TYPE ACTIVITIES
Net investment in capital assets 291,090$ 431,305$ 779,852$ 1,194,967$
Restricted - - - -
Unrestricted 1,298,434 1,518,474 1,557,185 1,396,375
TOTAL BUSINESS-TYPE ACTIVITIES 1,589,524$ 1,949,779$ 2,337,037$ 2,591,342$
PRIMARY GOVERNMENT
Net investment in capital assets 47,211,377$ 50,255,617$ 51,299,621$ 47,564,959$
Restricted 2,758,495 1,618,149 1,320,956 1,490,542
Unrestricted (17,616,869) (15,166,110) (14,308,238) (11,054,924)
TOTAL PRIMARY GOVERNMENT 32,353,003$ 36,707,656$ 38,312,339$ 38,000,577$
Data Source
Audited Financial Statements
VILLAGE OF MORTON GROVE, ILLINOIS
NET POSITION BY COMPONENT
Last Ten Fiscal Years
- 114 -
2009 2010 2011 2012 2013 2014
43,660,888$ 40,455,570$ 44,804,287$ 44,017,021$ 45,225,759$ 44,444,400$
15,697,500 19,784,173 11,645,390 13,415,241 14,644,385 15,893,795
(24,936,412) (23,196,704) (18,379,105) (20,475,242) (23,595,025) (23,603,372)
34,421,976$ 37,043,039$ 38,070,572$ 36,957,020$ 36,275,119$ 36,734,823$
1,918,346$ 3,844,337$ 4,490,571$ 4,108,087$ 4,945,237$ 5,875,794$
- - - - - -
928,429 177,104 409,939 2,044,418 2,835,446 3,765,559
2,846,775$ 4,021,441$ 4,900,510$ 6,152,505$ 7,780,683$ 9,641,353$
45,579,234$ 44,299,907$ 45,414,747$ 48,125,108$ 50,170,996$ 50,320,194$
15,697,500 19,784,173 11,645,390 13,415,241 14,644,385 15,893,795
(24,007,983) (23,019,600) (14,089,055) (18,430,824) (20,759,579) (19,837,813)
37,268,751$ 41,064,480$ 42,971,082$ 43,109,525$ 44,055,802$ 46,376,176$
- 115 -
Fiscal Year 2005 2006 2007 2008
EXPENSES
Governmental activities
General government 3,246,565$ 3,556,886$ 4,390,997$ 4,587,340$
Public safety 13,301,334 13,752,166 14,558,399 15,324,442
Streets and highways 3,349,491 3,205,566 3,187,348 4,196,379
Sanitation 455,792 411,845 627,214 632,928
Vehicle maintenance 700,854 752,462 872,991 932,625
Health and human services 525,788 557,683 669,564 679,218
Community development 1,278,214 2,023,898 2,433,222 2,047,185
Building and inspectional services 683,868 710,282 718,784 693,218
Interest 905,773 745,013 1,180,450 1,254,168
Total governmental activities expenses 24,447,679 25,715,801 28,638,969 30,347,503
Business-type activities
Water and sewer 3,779,714 4,026,028 4,047,889 4,550,240
Solid waste - - - -
Municipal parking - - - -
Total business-type activities expenses 3,779,714 4,026,028 4,047,889 4,550,240
TOTAL PRIMARY GOVERNMENT
EXPENSES 28,227,393$ 29,741,829$ 32,686,858$ 34,897,743$
PROGRAM REVENUES
Governmental activities
Charges for services
General government 2,255,978$ 2,202,037$ 2,289,270$ 2,151,555$
Public safety 309,786 314,940 469,729 439,602
Other activities 270,090 135,589 88,338 83,477
Operating grants and contributions 747,462 1,099,295 826,813 699,862
Capital grants and contributions 109,983 216,256 339,372 55,729
Total governmental activities
program revenues 3,693,299 3,968,117 4,013,522 3,430,225
Business-type activities
Charges for services
Water and sewer 4,580,331 4,174,016 4,239,458 4,596,060
Solid waste - - - -
Municipal parking - - - -
Capital grants and contributions - - - -
Total business-type activities
program revenues 4,580,331 4,174,016 4,239,458 4,596,060
TOTAL PRIMARY GOVERNMENT
PROGRAM REVENUE 8,273,630$ 8,142,133$ 8,252,980$ 8,026,285$
NET (EXPENSE) REVENUE
Governmental activities (20,754,380)$ (21,747,684)$ (24,625,447)$ (26,917,278)$
Business-type activities 800,617 147,988 191,569 45,820
TOTAL PRIMARY GOVERNMENT
NET (EXPENSE) REVENUE (19,953,763)$ (21,599,696)$ (24,433,878)$ (26,871,458)$
VILLAGE OF MORTON GROVE, ILLINOIS
CHANGE IN NET POSITION
Last Ten Fiscal Years
- 116 -
2009 2010 2011 2012 2013 2014
3,987,630$ 3,394,369$ 2,989,799$ 5,634,828$ 3,826,691$ 3,749,953$
16,452,967 16,785,158 18,359,859 18,526,759 18,773,860 19,225,281
3,815,984 4,312,475 4,685,104 3,547,591 5,823,268 4,043,649
646,686 74,942 - - - -
752,089 720,434 738,039 816,073 846,686 793,103
717,693 383,133 254,522 266,405 270,450 282,897
778,130 695,599 331,224 470,695 467,393 980,882
812,585 511,905 533,941 699,282 845,669 794,883
879,876 1,018,423 1,043,389 862,272 805,158 781,321
28,843,640 27,896,438 28,935,877 30,823,905 31,659,175 30,651,969
4,995,861 5,204,329 5,371,031 6,286,120 6,770,519 7,356,131
- 1,352,270 1,818,505 1,820,057 1,869,140 1,857,923
- - - 370 11,721 11,380
4,995,861 6,556,599 7,189,536 8,106,547 8,651,380 9,225,434
33,839,501$ 34,453,037$ 36,125,413$ 38,930,452$ 40,310,555$ 39,877,403$
2,068,374$ 2,928,022$ 2,889,549$ 2,870,140$ 3,120,247$ 3,426,448$
478,189 522,603 722,977 668,063 905,530 961,296
77,835 98,009 7,981 3,657 8,306 2,403
804,094 978,467 882,240 1,002,278 758,925 829,051
1,244 216,450 278,738 157,618 462,298 158,042
3,429,736 4,743,551 4,781,485 4,701,756 5,255,306 5,377,240
4,990,281 5,451,711 5,773,298 7,106,948 7,857,661 8,678,471
- 1,207,409 1,830,623 1,888,288 1,956,253 1,983,404
- - 13,660 44,325 54,091 59,633
- 811,519 64,122 64,122 59,024 59,473
4,990,281 7,470,639 7,681,703 9,103,683 9,927,029 10,780,981
8,420,017$ 12,214,190$ 12,463,188$ 13,805,439$ 15,182,335$ 16,158,221$
(25,413,904)$ (23,152,887)$ (24,154,392)$ (26,122,149)$ (26,403,869)$ (25,274,729)$
(5,580) 914,040 492,167 997,136 1,275,649 1,555,547
(25,419,484)$ (22,238,847)$ (23,662,225)$ (25,125,013)$ (25,128,220)$ (23,719,182)$
- 117 -
Fiscal Year 2005 2006 2007 2008
GENERAL REVENUES AND OTHER
CHANGES IN NET POSITION
Governmental activities
Taxes
Property 9,358,810$ 11,485,489$ 11,677,488$ 12,737,951$
Sales 6,798,236 7,788,874 7,061,621 6,370,839
Utility 1,267,383 1,185,594 1,213,165 1,206,890
Other 2,321,640 2,222,985 2,497,113 2,401,921
Intergovernmental
Income 1,702,521 1,839,485 1,987,153 2,125,301
Local use 262,846 293,618 297,200 331,713
Personal property replacement 340,114 363,585 441,693 434,614
Investment earnings 147,518 467,427 630,288 394,088
Miscellaneous 35,713 95,025 138,578 574,371
Gain on disposal of capital assets - - - -
Transfers 106,600 - - -
Total governmental activities 22,341,381 25,742,082 25,944,299 26,577,688
Business-type activities
Investment earnings 9,286 11,993 3,652 12,188
Contributions - - - -
Miscellaneous 146,429 200,274 192,037 196,297
Gain on disposal of capital assets - - - -
Transfers (106,600) - - -
Total business-type activities 49,115 212,267 195,689 208,485
TOTAL PRIMARY GOVERNMENT 22,390,496$ 25,954,349$ 26,139,988$ 26,786,173$
CHANGE IN NET POSITION
Governmental activities 1,587,001$ 3,994,398$ 1,318,852$ (339,590)$
Business-type activities 849,732 360,255 387,258 254,305
TOTAL PRIMARY GOVERNMENT
CHANGE IN NET POSITION 2,436,733$ 4,354,653$ 1,706,110$ (85,285)$
Data Source
Audited Financial Statements
Last Ten Fiscal Years
VILLAGE OF MORTON GROVE, ILLINOIS
CHANGE IN NET POSITION (Continued)
- 118 -
2009 2010 2011 2012 2013 2014
12,799,051$ 13,005,988$ 12,796,737$ 12,620,923$ 12,559,743$ 12,444,336$
5,604,221 5,576,524 5,602,819 5,940,931 6,277,412 6,413,855
1,144,676 1,159,513 1,154,124 1,119,227 1,166,101 1,228,883
2,308,750 2,280,628 2,231,857 2,471,292 2,287,247 2,186,679
1,824,794 1,766,942 1,797,158 2,044,675 2,217,174 2,227,959
272,041 303,687 338,416 366,352 400,868 454,615
368,208 395,543 348,557 349,197 387,116 398,843
304,129 114,990 73,661 26,846 12,248 15,843
295,348 1,170,135 813,078 262,112 414,059 363,420
- - 25,518 - - -
- - - - - -
24,921,218 25,773,950 25,181,925 25,201,555 25,721,968 25,734,433
3,469 6,296 15,454 13,740 2,665 2,966
108,134 8,100 - - - -
250,925 246,230 297,636 296,582 300,864 284,657
- - - - 49,000 17,500
- - - - - -
362,528 260,626 313,090 310,322 352,529 305,123
25,283,746$ 26,034,576$ 25,495,015$ 25,511,877$ 26,074,497$ 26,039,556$
(492,686)$ 2,621,063$ 1,027,533$ (920,594)$ (681,901)$ 459,704$
356,948 1,174,666 805,257 1,307,458 1,628,178 1,860,670
(135,738)$ 3,795,729$ 1,832,790$ 386,864$ 946,277$ 2,320,374$
- 119 -
Fiscal Year 2005 2006 2007 2008
GENERAL FUND
Nonspendable
Advance to other funds 72,073$ 55,457$ 1,667,406$ 1,614,804$
Prepaid items - - - -
Restricted for
Public safety - - - -
Specific property tax levies - - - -
Unrestricted/unassigned 6,399,102 9,492,148 8,890,161 8,477,050
TOTAL GENERAL FUND 6,471,175$ 9,547,605$ 10,557,567$ 10,091,854$
ALL OTHER GOVERNMENTAL FUNDS
Nonspendable
Prepaid items -$ -$ -$ -$
Advance to other funds - - - -
Restricted for
Public safety - - - 180,400
Capital improvements - unspent bond proceeds - - - 550,497
Community development 2,961,673 5,495,470 5,003,627 6,003,872
Economic development - - - 7,282,950
Highways and streets - - - 35,727
Debt service - - - 468,461
Unrestricted
Committed for community development - - - -
Assigned for commuter improvements - - - 133,254
Assigned for capital improvements (1,011,770) - - -
Special Revenue Funds - 197,035 9,264,692 -
Unassigned - - - (1,103,419)
TOTAL ALL OTHER
GOVERNMENTAL FUNDS 1,949,903$ 5,692,505$ 14,268,319$ 13,551,742$
Data Source
Audited Financial Statements
VILLAGE OF MORTON GROVE, ILLINOIS
FUND BALANCES OF GOVERNMENTAL FUNDS
Last Ten Fiscal Years
- 120 -
2009 2010 2011 2012 2013 2014
1,588,930$ 1,549,007$ 1,508,930$ 1,546,190$ 1,506,190$ 1,514,751$
6,626 - - 103,495 - 589,507
- - 116,805 116,805 14,559 -
- - - 7,357 - -
5,794,060 5,931,760 5,684,663 5,093,952 5,744,509 5,745,220
7,389,616$ 7,480,767$ 7,310,398$ 6,867,799$ 7,265,258$ 7,849,478$
22,336$ -$ -$ -$ -$ -$
- - - 35,714 - 44,364
196,590 191,843 459,385 482,443 498,175 805,492
488,113 6,483,518 4,284,205 2,481,828 1,078,056 18
14,452,122 12,671,491 10,771,232 12,360,035 13,493,724 14,228,109
- - - - - -
46,069 204,343 297,968 448,601 637,927 860,194
492,270 232,978 - - - -
- - 133,110 - - -
164,233 167,904 189,114 180,440 105,648 59,855
- - 683,421 543,242 - -
- - - - - -
(975,505) (1,079,187) (1,494,055) (1,956,874) (2,150,549) (1,905,351)
14,886,228$ 18,872,890$ 15,324,380$ 14,575,429$ 13,662,981$ 14,092,681$
- 121 -
Fiscal Year 2005 2006 2007 2008
REVENUES
Taxes 19,525,436$ 22,455,761$ 22,209,713$ 22,424,327$
Licenses and permits 1,473,641 1,375,358 1,194,285 1,115,215
Intergovernmental 3,162,925 3,812,238 3,902,475 3,647,439
Surcharge fees 220,634 227,181 239,671 293,273
Charges for services 683,943 700,674 983,358 982,042
Fines and forfeitures 282,892 273,543 327,835 281,457
Lease and rental income 30,832 - - -
Investment income 147,520 467,426 620,046 393,869
Cable TV 184,424 197,272 215,606 224,026
Miscellaneous 222,516 200,746 264,832 628,427
Total revenues 25,934,763 29,710,199 29,957,821 29,990,075
EXPENDITURES
General government 2,807,443 3,099,624 3,176,009 3,829,837
Public safety 11,627,607 12,918,063 14,809,880 14,878,141
Streets and sidewalks 2,322,281 2,268,649 3,027,875 3,236,324
Sanitation 455,792 405,715 627,214 632,928
Vehicle maintenance 700,854 752,462 872,991 932,625
Health and human services 503,762 560,598 669,564 679,218
Community development 943,973 1,582,343 605,286 2,047,185
Building and inspection services 682,764 719,296 718,083 687,918
Debt service
Principal 1,986,557 1,766,127 1,940,203 1,701,086
Interest 943,342 690,343 999,340 1,304,359
Other charges - - 101,800 -
Capital outlay 906,404 958,947 2,025,571 1,034,105
Total expenditures 23,880,779 25,722,167 29,573,816 30,963,726
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 2,053,984 3,988,032 384,005 (973,651)
OTHER FINANCING SOURCES (USES)
Transfers in 714,669 83,829 2,496,092 137,162
Transfers (out)(608,069) (83,829) (2,496,092) (137,162)
Issuance of bonds 283,198 2,831,000 9,200,000 -
Issuance of refunding bonds - - - -
Discount on debt issuance - - - -
Issuance of refunding installment note - - - -
Issuance of installment note - - - -
Payment to bond escrow - - - -
Other - - 103,198 -
Proceeds from sale of capital assets 23,225 - - 17,838
Total other financing sources (uses)413,023 2,831,000 9,303,198 17,838
NET CHANGE IN FUND BALANCES 2,467,007$ 6,819,032$ 9,687,203$ (955,813)$
DEBT SERVICE AS A PERCENTAGE OF
NONCAPITAL EXPENDITURES 12.75%9.92%10.47%9.96%
Data Source
Audited Financial Statements
VILLAGE OF MORTON GROVE, ILLINOIS
CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
Last Ten Fiscal Years
- 122 -
2009 2010 2011 2012 2013 2014
21,586,089$ 21,775,843$ 21,551,420$ 21,879,247$ 22,290,504$ 22,273,754$
1,029,669 1,569,517 1,587,662 1,472,977 1,498,507 1,741,148
3,270,381 3,661,090 3,645,110 4,010,271 4,290,145 4,250,153
270,610 246,812 234,115 273,226 249,121 246,727
873,261 1,014,532 1,152,456 1,067,979 1,061,973 1,139,875
346,754 561,349 531,010 609,450 835,461 827,515
- - - - - -
304,129 114,990 73,661 26,846 12,248 15,843
233,278 260,205 259,862 322,937 322,822 340,991
436,783 1,313,163 902,535 240,378 416,493 275,667
28,350,954 30,517,501 29,937,831 29,903,311 30,977,274 31,111,673
3,235,134 2,941,777 2,299,975 2,960,966 2,983,917 2,969,658
15,393,475 15,899,654 16,948,038 16,841,291 16,871,340 17,705,168
3,029,454 2,754,279 2,752,341 2,974,086 3,147,491 3,732,439
644,771 74,942 - - - -
752,089 720,434 738,039 816,073 846,686 793,103
718,045 395,984 255,880 263,187 284,289 282,897
529,407 557,192 545,904 766,988 765,500 1,322,606
807,146 514,832 555,482 698,263 858,707 790,256
10,144,327 2,434,899 5,390,149 2,649,987 2,627,833 2,846,995
1,084,892 1,081,772 1,026,638 859,489 793,459 783,179
94,346 - - - - -
975,791 4,680,419 3,173,842 2,342,331 3,431,829 315,560
37,408,877 32,056,184 33,686,288 31,172,661 32,611,051 31,541,861
(9,057,923) (1,538,683) (3,748,457) (1,269,350) (1,633,777) (430,188)
136,945 62,630 - - - -
(136,945) (62,630) - - - -
- 5,586,000 - - - -
10,657,500 - - - - -
(11,975) (3,371) - - - -
2,685,000 - - - - -
- - - - 1,060,000 1,415,000
(5,661,824) - - - - -
- - - - - -
21,470 33,867 29,578 77,800 58,788 29,108
7,690,171 5,616,496 29,578 77,800 1,118,788 1,444,108
(1,367,752)$ 4,077,813$ (3,718,879)$ (1,191,550)$ (514,989)$ 1,013,920$
30.68%12.21%19.95%11.36%11.02%11.84%
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VILLAGE OF MORTON GROVE, ILLINOIS
ASSESSED AND ACTUAL VALUE OF TAXABLE PROPERTY
Last Ten Levy Years
Total Estimated Estimated
Less:Total Taxable Direct Actual Actual
Levy Residential Farm Commercial Industrial Tax-Exempt Assessed Tax Taxable Taxable
Year Property Property Property Property Property Value Rate Value Value
2004 488,573,518$ -$ 102,814,670$ 157,782,189$ -$ 749,170,377$ 0.995 2,247,511,131$ 33.333%
2005 534,079,256 - 102,275,899 164,166,151 - 800,521,306 1.122 2,401,563,918 33.333%
2006 545,691,470 - 107,797,552 154,382,871 - 807,871,893 1.159 2,423,615,679 33.333%
2007 690,027,687 - 110,013,043 168,985,460 - 969,026,190 0.996 2,907,078,570 33.333%
2008 758,998,259 - 109,264,039 187,025,722 - 1,055,288,020 0.915 3,165,864,060 33.333%
2009 784,203,243 115,060 98,422,952 147,319,741 - 1,030,060,996 0.937 3,090,182,988 33.333%
2010 701,075,231 103,019 105,399,747 146,339,223 - 952,917,220 1.021 2,858,751,660 33.333%
2011 660,244,991 103,019 89,873,325 127,153,891 - 877,375,226 1.139 2,632,125,678 33.333%
2012 606,992,305 103,019 87,545,734 116,476,425 - 811,117,483 1.231 2,433,352,449 33.333%
2013 502,751,427 87,861 84,511,239 101,866,766 - 689,217,293 1.449 2,067,651,879 33.333%
Note: Property in the Village is reassessed each year. Property is assessed at 33% of actual value.
Data Source
Office of the County Clerk
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Tax Levy Year 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
VILLAGE DIRECT RATES
General 0.778 0.940 0.660 0.559 0.486 0.465 0.528 0.597 0.658 0.725
Police pension - - 0.142 0.132 0.138 0.162 0.179 0.182 0.191 0.258
Fire pension - - 0.176 0.151 0.157 0.179 0.199 0.205 0.216 0.284
Bonds and interest 0.075 0.070 0.068 0.058 0.053 0.049 0.075 0.126 0.136 0.143
IMRF 0.024 - - - - - - 0.021 0.022 0.030
Purchase agreement 0.071 0.002 0.002 0.002 0.002 0.052 0.002 0.002 0.002 0.003
IEPA agreement - 0.065 0.064 0.053 0.049 - 0.027 - - -
Capital improvement 0.046 0.045 0.047 0.040 0.029 0.030 0.011 0.006 0.006 0.008
Total direct rates 0.995 1.122 1.159 0.995 0.914 0.937 1.021 1.139 1.231 1.449
OVERLAPPING RATES
Morton Grove Library 0.299 0.288 0.307 0.266 0.259 0.269 0.335 0.349 0.377 0.444
School District #68 2.178 2.149 2.258 1.931 1.882 1.999 2.133 2.452 2.723 3.144
School District #69 2.794 3.335 3.527 3.124 3.247 3.768 4.357 4.866 5.481 6.214
School District #67 2.129 2.041 2.094 1.859 1.807 1.943 2.203 2.449 2.961 3.497
School District #63 2.624 2.542 2.617 2.276 2.233 2.235 2.499 2.775 3.100 3.864
School District #70 2.792 2.729 2.846 2.506 2.484 2.574 2.890 3.261 3.669 4.351
High School District #207 1.795 1.757 1.826 1.602 1.577 1.617 1.782 1.995 2.215 2.722
High School District #219 2.013 2.007 2.374 2.114 2.120 2.267 2.538 2.904 3.256 3.707
Community College District #535 0.161 0.158 0.166 0.141 0.140 0.140 0.160 0.196 0.219 0.256
Cook County 0.593 0.533 0.500 0.446 0.415 0.394 0.423 0.462 0.531 0.560
Cook County Forest Preserve 0.060 0.060 0.057 0.053 0.051 0.049 0.051 0.058 0.063 0.069
Consolidated Elections - - - 0.012 - 0.021 - 0.025 0.531 0.031
Metro Water Reclamation District 0.347 0.315 0.028 0.263 0.252 0.261 0.274 0.320 0.370 0.417
Morton Grove Park District 0.337 0.325 0.328 0.289 0.272 0.284 0.311 0.365 0.382 0.468
Skokie Park District 0.437 0.407 0.436 0.375 0.386 0.383 0.423 0.476 0.518 0.581
Glenview Park District 0.505 0.490 0.511 0.429 0.429 0.422 0.483 0.538 0.579 0.662
Maine Township 0.122 0.121 0.127 0.114 0.112 0.117 0.131 0.149 0.168 0.210
Niles Township 0.033 0.031 0.034 0.030 0.030 0.032 0.036 0.042 0.048 0.056
Suburban T.B. Sanitary District 0.001 0.005 0.005 - - - - - - -
North Shore Mosquito Abatement 0.008 0.008 0.009 0.008 0.008 0.008 0.009 0.010 0.010 0.007
Data Source
Office of the County Clerk
VILLAGE OF MORTON GROVE, ILLINOIS
PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS
Last Ten Levy Years
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VILLAGE OF MORTON GROVE, ILLINOIS
PRINCIPAL PROPERTY TAXPAYERS
Current Year and Nine Years Ago
Percentage Percentage
of Total of Total
Village Village
EAV Taxable EAV Taxable
Assessed Assessed Assessed Assessed
Taxpayer Value Rank Valuation Value Rank Valuation
CRP Holdings CLP 14,084,820$ 1 2.04%19,124,549$ 2 2.39%
Schwinge Family Ltd.11,247,373 2 1.63%11,565,995 5 1.44%
Tower Real Estate 9,407,063 3 1.36%20,572,986 1 2.57%
9000 Waukegan LLC 8,617,665 4 1.25%12,402,547 3 1.55%
Menards 7,271,883 5 1.06%12,300,304 4 1.54%
Bell & Gossett (Fluid Handling LLC)7,121,101 6 1.03%10,142,254 6 1.27%
Avon Products Inc.7,097,511 7 1.03%10,109,600 7 1.26%
Schwartz Paper Co 0.00%8,701,678 8 1.09%
Lawnware Products 0.00%6,204,875 10 0.78%
John Crane Inc.6,029,821 8 0.87%- 0.00%
Public Storage 5,468,640 9 0.79%8,008,438 9 1.00%
Kraft 5,031,679 10 0.73%- 0.00%
81,377,556$ 11.79%119,133,226$ 14.89%
Data Source
Office of the County Clerk
2014 2005
Note: Every effort has been made to seek out and report the largest taxpayers. However, many of the taxpayers contain multiple
parcels and it is possible that some parcels and their valuations have been overlooked.
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VILLAGE OF MORTON GROVE, ILLINOIS
PROPERTY TAX LEVIES AND COLLECTIONS
Last Ten Levy Years
Collections
Levy Percentage in Subsequent Percentage
Year Tax Levied Amount of Levy Years Amount of Levy
2004 7,450,559$ 7,257,511$ 97.41%-$ 7,257,511$ 97.41%
2005 8,983,978 8,861,648 98.64%- 8,861,648 98.64%
2006 9,368,298 9,160,127 97.78%- 9,160,127 97.78%
2007 9,649,253 9,455,259 97.99%- 9,455,259 97.99%
2008 9,649,253 9,312,628 96.51%- 9,312,628 96.51%
2009 9,649,253 9,346,622 96.86%- 9,346,622 96.86%
2010 9,986,977 9,544,078 95.57%- 9,544,078 95.57%
2011 9,986,977 9,756,941 97.70%- 9,756,941 97.70%
2012 9,986,976 9,784,931 97.98%- 9,784,931 97.98%
2013 9,986,976 9,821,777 98.35%- 9,821,777 98.35%
Note: Property in the Village is reassessed each year. Property is assessed at 33% of actual value.
Data Source
Office of the County Clerk
Collected within the
Fiscal Year of the Levy Total Collections to Date
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Governmental Activities Business-Type Activities
Fiscal General Revolving Installment Intergovernmental General Revolving Installment Total Percentage of
Year Obligation Loans Notes Agreements Obligation Loans Notes Primary Personal Per
Ended Bonds Payable Payable Payable Bonds Payable Payable Government Income*Capita*
2005 8,306,250$ 2,809,212$ 12,375,858$ 5,016,627$ 2,768,750$ 361,529$ 621,191$ 32,259,417$ 5.15%1,436.88$
2006 7,657,500 2,431,075 14,280,939 4,867,208 2,552,500 292,771 486,778 32,568,771 5.20%1,450.66
2007 16,182,500 2,039,279 13,015,702 4,682,533 2,327,500 222,283 370,161 38,839,958 6.20%1,729.99
2008 15,481,250 1,633,332 12,015,866 4,482,974 2,093,750 150,021 250,081 36,107,274 5.76%1,608.27
2009 19,283,750 1,212,720 4,648,818 4,260,718 1,856,250 75,943 51,148 31,389,347 5.01%1,398.13
2010 23,124,800 776,917 4,394,673 4,014,958 5,855,200 - - 38,166,548 6.08%1,640.16
2011 21,072,950 325,372 1,507,919 3,753,704 5,347,050 - - 32,006,995 5.10%1,375.46
2012 18,958,300 - 1,297,954 3,457,411 4,766,700 - - 28,480,365 4.54%1,223.91
2013 16,549,300 - 2,139,121 3,134,950 4,175,700 - - 25,999,071 4.14%1,117.28
2014 15,487,800 - 1,768,626 2,785,393 3,577,200 - - 23,619,019 3.10%1,015.00
Note: Details of the Village's outstanding debt can be found in the notes to financial statements.
* See the schedule of Demographic and Economic Information on page 132 for personal income and population data.
VILLAGE OF MORTON GROVE, ILLINOIS
RATIOS OF OUTSTANDING DEBT BY TYPE
Last Ten Fiscal Years
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Percentage of
Less: Amounts Estimated
General Business Type Available Actual Taxable
Fiscal Obligation General Obligation In Debt Value of Per
Year Bonds Bonds Service Fund Total Property*Capita
2005 8,306,250$ 2,768,750$ 574,321$ 10,500,679$ 1.40%467.72$
2006 7,657,500 2,552,500 597,680 9,612,320 1.20%428.15
2007 16,182,500 2,327,500 417,525 18,092,475 2.24%805.86
2008 15,481,250 2,093,750 468,461 17,106,539 1.77%761.95
2009 19,283,750 1,856,250 492,269 20,647,731 1.96%887.31
2010 23,124,800 5,855,200 232,978 28,747,022 2.79%1,235.37
2011 21,072,950 5,347,050 - 26,420,000 2.77%1,135.37
2012 18,958,300 4,766,700 - 23,725,000 2.70%1,019.55
2013 16,549,300 4,175,700 - 20,725,000 2.56%890.63
2014 15,487,800 3,577,200 46,839 19,018,161 2.76%817.28
User fees/charges are the main source in repayment of the General Obligation Bonds - Business-Type.
* See the schedule of Assessed and Actual Value of Taxable Property on page 124 for property value data.
VILLAGE OF MORTON GROVE, ILLINOIS
RATIOS OF GENERAL BONDED DEBT OUTSTANDING
Last Ten Fiscal Years
Notes: Details of the Village's outstanding debt can be found in the notes to financial statements.
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VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF DIRECT AND OVERLAPPING BONDED DEBT
December 31, 2014
(1) (2)
Percentage
of Debt
Gross Applicable to Government's
Governmental Unit Bonded Debt Government Share of Debt
Village of Morton Grove 20,041,819$ 100%20,041,819$
Total direct debt 20,041,819 20,041,819
SCHOOLS
School District #63 7,325,000 15.68%1,148,305
School District #67 120,020,470 77.46%92,963,050
School District #68 2,085,000 0.52%10,761
School District #69 9,665,000 17.77%1,717,171
School District #70 3,630,000 98.68%3,582,227
Community College District #535 35,370,000 3.64%1,289,234
High School District #207 12,120,000 3.69%447,461
High School District #219 144,154,263 15.61%22,506,175
Total schools 334,369,733 123,664,384
OTHERS
Cook County 3,491,226,750 0.55%19,109,851
Cook County Forest Preserve 118,610,000 0.55%649,233
Metropolitan Metro Water Reclamation
District of Greater Chicago 2,394,960,000 0.56%13,374,283
Glenview Park District 11,090,000 0.14%15,399
Morton Grove Park District - 0.00%-
Skokie Park District 2,250,000 0.53%11,911
Total others 6,018,136,750 33,160,677
Total overlapping debt 6,352,506,483 156,825,061
TOTAL DIRECT AND OVERLAPPING DEBT 6,372,548,302$ 176,866,880$
Overlapping debt percentages based on 2013 EAV, the most recent available.
(2)
(1)
Date Source
Cook County Clerk
Percentages are calculated by comparing the equalized assessed value (EAV) of the overlapping entity that falls
within the boundaries of the Village to its total EAV.
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VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF LEGAL DEBT MARGIN
December 31, 2014
Under the 1970 Illinois Constitution, there is no legal limit for home rule municipalities except
as set by the General Assembly.
- 131 -
Per
Capita
Fiscal Personal Personal Unemployment
Year Population Income Income Rate
2005 22,451 626,360,449$ 27,899$ 3.8%
2006 22,451 626,360,449 27,899 3.8%
2007 22,451 626,360,449 27,899 3.9%
2008 22,451 626,360,449 27,899 6.5%
2009 22,451 626,360,449 27,899 8.1%
2010 23,270 626,358,590 26,917 8.9%
2011 23,270 627,661,710 26,973 8.9%
2012 23,270 627,661,710 26,973 8.9%
2013 23,270 627,661,710 26,973 8.7%
2014 23,270 762,278,660 32,758 5.6%
Data Source
U.S. Bureau of Census
Department of Labor
Village records
VILLAGE OF MORTON GROVE, ILLINOIS
DEMOGRAPHIC AND ECONOMIC INFORMATION
Last Ten Fiscal Years
- 132 -
% of % of
Total Village Total Village
Employer Rank Employees Population Employer Rank Population
John Crane Inc 1 700 3.0%Avon Products Inc 1 3.1%
Xylem 2 650 2.8%ITT Bell & Gossett 2 3.1%
Schwartz Paper Co 3 347 1.5%John Crane Inc 3 3.0%
Shore Koenig Training Center 4 205 0.9%Sunstone 4 1.3%
Morton Grove Pharmaceuticals Inc 5 190 0.8%Lawnware Products 5 0.8%
Quantum Group 6 170 0.7%Menards 6 0.7%
TSI Accessory Group 7 165 0.7%Schwartz Paper Co 7 0.7%
Integrated Mechandising System LLC 8 150 0.6%Quantum Group 8 0.6%
Catering by Michael's 9 120 0.5%Morton Grove Pharmaceuticals Inc 9 0.6%
Lifeway Foods Inc 10 100 0.4%Dominicks Finer Foods 10 0.6%
Village Population = 23,270 Village Population = 22,451
Note: 2005 number of employees is unavailable.
Data Source
Village business licences
2014 Illinois Manufacturers Directory and 2014 Illinois Services Directory
2014 2006
VILLAGE OF MORTON GROVE, ILLINOIS
PRINCIPAL EMPLOYERS
Current Year and Eight Years Ago
- 133 -
Function/Program 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
GENERAL GOVERNMENT
Administrative 4.5 5.0 4.5 4.5 3.5 3.0 3.0 4.0 4.0 4.5
Community development 1.5 1.5 1.5 1.5 1.5 1.0 1.0 1.0 1.0 2.5
Legal 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5
Management information 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0
Finance 7.0 7.5 6.5 6.0 5.5 5.5 5.5 5.0 6.0 6.0
Health and human services - - - - - - - 0.5
Family services 12.0 12.0 12.0 9.5 11.5 4.5 4.5 4.5 3.5 2.5
Building/code enforcement 10.0 9.0 8.5 8.0 7.0 4.0 4.0 2.5 4.0 5.0
PUBLIC SAFETY
Police
Officers 46.0 46.0 46.0 46.0 45.0 45.0 46.0 45.0 45.0 46.0
Civilians 25.5 23.5 23.5 23.0 22.0 20.0 18.5 18.5 21.0 17.0
Fire
Firefighters and officers 43.0 44.0 44.0 42.0 40.0 41.0 41.0 40.0 42.0 41.0
Civilians 3.5 3.0 3.0 3.0 30.0 2.5 2.5 1.5 3.5 3.0
PUBLIC WORKS
Street maintenance 16.5 16.5 16.5 16.5 17.5 17.5 17.5 17.5 17.5 20.0
Engineering 3.2 3.2 3.2 3.2 3.0 3.0 3.0 3.0 3.0 3.0
Vehicle maintenance 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0
Water/sewer 13.3 13.3 13.3 13.3 12.0 12.0 12.0 12.0 12.0 12.0
TOTAL 191.5 190.0 188.0 182.0 177.0 164.5 164.0 160.0 168.0 168.5
Data Source
Village budget office
VILLAGE OF MORTON GROVE, ILLINOIS
FULL-TIME EQUIVALENT EMPLOYEES
Last Ten Fiscal Years
- 134 -
Function/Program 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
PUBLIC SAFETY
Police
Physical arrests 596 710 635 550 651 647 574 580 513 551
Parking violations 4,164 3,866 5,210 5,171 6,075 8,331 8,933 6,751 6,465 4,530
Traffic violations 6,215 7,681 4,598 4,367 5,092 4,587 4,440 3,686 3,849 3,072
Fire
Emergency responses 3,255 3,246 3,384 3,594 3,249 3,265 3,419 3,360 3,470 3,631
Fires extinguished 45 36 38 22 70 59 60 48 63 69
PUBLIC WORKS
Street resurfacing (miles)0.66 1.41 1.81 0.63 1.33 3.03 4.90 6.65 5.70 1.50
Pothole repairs (in tons)93.74 71.50 121.50 120.00 180.00 189.00 170.75 12.50 132.00 160.00
WATER
New connections 5 27 70 23 1 27 8 9 7 9
Water main breaks 117 55 85 67 91 81 64 70 122 80
Average daily consumption 3,416,000 3,050,000 3,180,000 3,500,000 2,999,484 2,969,923 2,670,613 2,745,553 2,601,227 2,869,367
Peak daily consumption 6,736,000 4,964,000 4,955,000 6,200,000 4,374,000 4,167,000 4,498,000 4,412,000 4,238,000 3,628,000
WASTEWATER
Average daily treatment N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Data Source
Various Village departments
VILLAGE OF MORTON GROVE, ILLINOIS
OPERATING INDICATORS
Last Ten Fiscal Years
- 135 -
Function/Program 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
PUBLIC SAFETY
Police
Stations 1 1 1 1 1 1 1 1 1 1
Area patrols 3 3 3 3 3 3 3 3 3 3
Patrol units 15 15 15 15 15 15 15 15 15 15
Fire
Fire stations 2 2 2 2 2 2 2 2 2 2
Fire engines 2 2 2 2 2 2 2 2 2 2
PUBLIC WORKS
Arterial streets (miles)19 19 19 19 19 19 19 19 19 19
Residential streets (miles)86 86 86 86 86 86 86 86 86 86
Streetlights 372 372 372 357 357 357 357 357 357 357
Traffic signals 13 13 13 13 13 13 13 13 13 13
WATER
Water mains (miles)98.9 98.9 98.9 98.9 98.9 98.9 98.9 98.9 98.9 98.9
Fire hydrants 1,093 1,093 1,093 1,093 1,093 1,093 1,093 1,093 1,093 1,093
Storage capacity (gallons)8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000 8,550,000
WASTEWATER
Sanitary sewers (miles)47.9 47.9 47.9 47.9 47.9 47.9 47.9 47.9 47.9 47.9
Storm sewers (miles)70.6 70.6 70.6 70.6 70.6 70.6 70.6 70.6 70.6 70.6
Combined sewers (miles)23.6 23.6 23.6 23.6 23.6 23.6 23.6 23.6 23.6 23.6
Treatment capacity (gallons)N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Data Source
Various Village departments
VILLAGE OF MORTON GROVE, ILLINOIS
CAPITAL ASSET STATISTICS
Last Ten Fiscal Years
- 136 -
COMPLIANCE SECTION