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HomeMy WebLinkAbout2015-02-09 Minutes MINUTES OF A REGULAR MEETING OF THE PRESIDENT AND THE BOARD OF TRUSTEES OF THE VILLAGE OF MORTON GROVE COOK COUNTY, ILLINOIS, HELD AT THE RICHARD T. FLICKINGER MUNICIPAL CENTER FEBRUARY 9, 2015 CALL TO ORDER I & II. Village President Dan DiMaria called the meeting to order at 6:00 p.m. in the Trustees’ Conference Room and led the Board in the Pledge of Allegiance. III. Village Clerk Ed Ramos called the roll. Present were: Trustees Bill Grear, Shel Marcus, John Pietron, John Thill, Maria Toth, and Janine Witko. IV. EXECUTIVE SESSION Trustee Marcus moved to adjourn to Executive Session to discuss pending litigation, personnel, and real estate matters. Trustee Toth seconded the motion. Motion passed: 6 ayes, 0 nays. Tr. Grear aye Tr. Marcus aye Tr. Pietron aye Tr. Thill aye Tr. Toth aye Tr. Witko aye The Executive Session began at 6:01 p.m. Trustee Pietron then moved to adjourn the Executive Session and recommence the regular Board meeting in the Council Chambers at 7:00 p.m. The motion was seconded by Trustee Toth and passed unanimously via voice vote. The Executive Session adjourned at 6:46 p.m. RECONVENE MEETING Village President Dan DiMaria reconvened the meeting at 7:00 p.m. and led the assemblage in the Pledge of Allegiance, after which Clerk Ed Ramos called the roll. V. APPROVAL OF MINUTES Regarding the Minutes of the January 26, 2015 Regular Board Meeting, Trustee Toth moved, seconded by Trustee Witko, to accept the Minutes as corrected. Motion passed unanimously via voice vote. Minutes of February 9, 2015 Board Meeting 2 VI. a. b. c. d. e. f. g. h. SPECIAL REPORTS Moody’s Rating Downgrade Mayor DiMaria introduced Elisabeth Hennessey from William Blair & Company to talk to the Board and the assemblage about Moody’s Investor Services’ recent downgrade of the Village’s bond rating from Aa2 to Aa3. Ms. Henessey said that Moody’s cited four main reasons for the downgrade: (1) the Village’s declining EAV; (2) the Village’s narrow cash reserves; (3) the Village’s adjusted net pension liability relative to tax base and revenue; and (4) the Village’s flexibility to raise revenue as a home rule community. She said it’s important to point out that Morton Grove’s bond rating is still in the “Aa” category, which is good. The impact on the proposed 2015 bond issue is minimal. The Village maintains an outstanding bond rating of “AA” from Standard & Poor’s. Ms. Hennessey provided a recap of the Village’s outstanding debt, and suggested that the 2007 bonds could be refunded for a savings to the Village of over $400,000. She said the Village is in good shape and is paying off debt obligations faster than most other Aa rated entities. By doing this now, the Village avoids future interest rate risk and will save money in the cost of issuance. The Village has indicated that it will use $5 million from the 2015 bond issue for capital projects, and $6.5 million to refund the General Obligation Bonds 2007. Ms. Hennessey explained that Moody’s evaluates bond ratings every few years. Moody’s has changed their rating criteria since the last time the Village was rated. Their methodology for pension liability now uses a more conservative investment rate. The EAV declined by 15.03% between 2012 and 2013, and by 7.43% in the prior three years, due to the national recession and the effect of the Cook Country multiplier, which reduces the value of the entire tax base in Cook County by the same amount. This is something over which the Village has no control; however, it has been actively working on new development projects (such as the new Audi dealership) to help increase the Village’s EAV. Trustee Grear commented that another reason Moody’s gave for lowering the bond rating is the lack of revenue in the Waukegan Road TIF fund. That TIF retires in 2018. Trustee Grear said the cash balance in the TIF fund is low because the State of Illinois is behind in its payments to the Village. Trustee Grear added that the Village’s pensions are 52% funded; if the Village increased its pension contributions by 2% a year, the pensions would be fully funded by the year 2040. Trustee Grear said that the Village’s 2014 General Obligation bonds carry a 2.39% interest rate, but the 2015 bonds could be at 2.16%, so even though the bond rating declined, the Village is still saving money. Village Administrator Ryan Horne said that Trustee Grear had some excellent points. He noted that the things beyond the Village’s control are having an impact on its bond rating. But “Aa” is a strong category, and Morton Grove bond rating is higher than Cook County, the State of Illinois, and the City of Chicago. There are 16 levels of ratings, and Morton Grove is in the #4 category. Minutes of February 9, 2015 Board Meeting 3 VI. i. j. k. l. m. n. o. p. q. r. s. SPECIAL REPORTS (continued) Trustee Pietron noted that Standard & Poor’s had recently been hit with a multi-million dollar fine for inflating the ratings on mortgage bonds, which helped precipitate the recession. He wondered if the ratings systems had gotten “skittish,” which might be another reason why Moody’s gave the Village a more conservative rating. Ms. Hennessey said that the fine imposed on Standard & Poor’s really had more to do with rating mortgages, and nothing to do with municipal bonds, but she agreed that it could possibly have made the pendulum swing to the more conservative side. Trustee Marcus said that Moody’s had communicated to the Village the reasons for its downgraded rating. One was a weakened year-end cash balance. Trustee Marcus asked if the Village funded anything from its cash reserves. Mr. Horne said that the Moody’s representative did not agree with some of the things the Village listed as cash. He said that he and the Finance Director showed the Moody’s representative the Village’s bank statements, noting the cash on hand, but the representative said he would not act on the new information. Trustee Marcus said that, during the recent recession, the Village limited the number of full-time employees and hired more part-time employees, which helped with costs and pensions, and that enabled the Village to maintain a high bond rating during the national downturn. Mr. Horne said that, if the Village hires a general employee, they contribute to their pension via payroll deductions to IRMF, and there’s no real pension impact on the Village. It’s only full-time police and fire personnel whose pensions have an impact on the Village. Mr. Horne said that the Village has a lower number of full-time personnel than it had 10 years ago. There has been some growth in the Building Department, mostly due to customer dissatisfaction. He added that, during the recession, the Village had an Aa3 bond rating. A few years ago it went up to Aa2, stayed at that rating for a couple of years, and now it’s back to Aa3. Trustee Marcus said that the State’s financial situation has negatively impacted the Village and wondered if the Village could expect any relief. Ms. Hennessey said that Moody’s report expresses concern about the State, especially in regards to state income tax payments. She said everyone is waiting to hear what the new governor’s plan is. Trustee Marcus said that the Board wants to do what’s in the taxpayers’ best interest. Ms. Hennessey said that, if the Board decides to proceed with the 2015 bond issue, they could get into the market the first week of March, and have the revenue by mid-March. Trustee Marcus asked Ms. Hennessey if she could “ballpark” what the interest rate would be. She responded that the markets change every day, but she would guess it would be in the range of 2.126%. VII. PUBLIC HEARINGS NONE Minutes of February 9, 2015 Board Meeting 4 VIII. RESIDENTS’ COMMENTS (Agenda Items Only) NONE IX. 1. 2. PRESIDENT’S REPORT Mayor DiMaria said he was not satisfied with Moody’s downgrading of the Village’s bond rating. He said he hoped the addition of a 165-unit apartment complex would help the EAV. Mayor DiMaria said he asked Mr. Horne to provide the Board with an analysis of everything that contributes to the Village’s bond rating, noting that the Village is already addressing some of them. Appointments Mayor DiMaria asked for concurrence with two appointments this evening: Nancy Lanning to the Social Services Ad Hoc Committee Sue Mok to the Community Relations Commission Oscar Chung to the Economic Development Commission Trustee Pietron moved to concur with these appointments, seconded by Trustee Grear. Motion passed unanimously via voice vote. Mayor DiMaria commented that both Sue and Oscar are from the Asian community in Morton Grove; he said he’s working to get more diversity on the Village’s Boards and Commissions. X. CLERK’S REPORT Clerk Ramos noted that early voting for the February 24th Primary Election began today and goes through February 21st. Early voting takes place at Niles Village Hall from Monday through Saturday, 9:00 a.m. to 5:00 p.m. There will not be early voting on Monday, February 16, because of the President’s Day holiday. XI. A. STAFF REPORTS Village Administrator: Village Administrator Ryan Horne had no report. B. Corporation Counsel: Corporation Counsel Liston had no report. Minutes of February 9, 2015 Board Meeting 5 XII. A. TRUSTEES’ REPORTS Trustee Grear: Trustee Grear had no formal report, but thanked Public Works for doing a great job once again. Trustee Grear asked residents to please take some responsibility and work together to help Public Works clear the streets. If there are predictions for a snow storm, move your car(s) into your driveway, or share your driveway with a neighbor without one. Public Works can’t clear the streets when there are cars parked on them. This is especially true in the case of storms with large amounts of snow. He asked everyone to be good neighbors and good residents, saying he’d rather rely on the people to do the right thing than pass an ordinance requiring it. B. Trustee Marcus: Trustee Marcus had no formal report. He stated that he had attended the Farmers’ Market “Winter Market” this past Saturday and ran into Trustee Witko, who was a volunteer for it. It was a very nice event. Trustee Witko added that there will be a “Mother’s Day Market” in May and then the Farmers’ Market season opens the first Saturday in June. Trustee Marcus said this is an all-volunteer effort and it’s great for the community. He urged everyone to support the Farmers’ Market. C. Trustee Pietron: Trustee Pietron had no report. D. Trustee Thill: Trustee Thill presented Resolution 15-09, Authorizing the Execution of a Contract With Arthur Weiler, Inc. For the 2015 Tree Planting Program. He explained that the Village has an annual program, depending on funding appropriations, to plant trees within the Village rights-of-way and property. This contract was bid through a public process. The lowest bidder of the three bids submitted was Arthur Weiler, Inc., in the amount of $14,535 for a quantity of 54 trees. Trustee Thill moved to approve Resolution 15-09, seconded by Trustee Pietron. Motion passed: 6 ayes, 0 nays. Tr. Grear aye Tr. Marcus aye Tr. Pietron aye Tr. Thill aye Tr. Toth aye Tr. Witko aye Minutes of February 9, 2015 Board Meeting 6 XII. E. 1. a. b. c. d. e. 2. a. b. TRUSTEES’ REPORTS (continued) Trustee Toth: Trustee Toth presented Resolution 15-10, Authorizing a Contractual Agreement With Chapman and Cutler, LLP For Services as Bond Counsel and Disclosure Counsel, and Authorizing Staff to Proceed With Necessary Work Relating to the Issuance of General Obligation Bonds, Series 2015, For the Village of Morton Grove. Trustee Toth explained, per tonight’s earlier discussion, that the Village finds the favorable bond market to be an opportunity to refund its General Obligation Bonds, Series 2007, in the amount of $6.5 million and obtain funding for a new General Obligation Bond issue, Series 2015, in the amount of $5 million. In order to retire and issue these bonds, the Village requires the services of a specialized Bond Counsel and Disclosure Counsel. The refunding of the Series 2007 Bonds will result in a savings to the Village of approximately $450,000, depending on market conditions at the time of the sale. Trustee Toth said the Village has previously used Chapman and Cutler, LLP to serve as Bond Counsel and has found their services to be excellent. Staff therefore recommends the Village retain Chapman and Cutler LLP to act as Bond Counsel and Disclosure Counsel, and perform the related services during 2015. Their fee is based on the size, structure, timing, and tax exempt status of the bonds, and will be paid from the proceeds of the sale of the bonds. It is estimated to be $30,000. Trustee Toth moved, seconded by Trustee Grear, to approve Resolution 15-10. Motion passed: 6 ayes, 0 nays. Tr. Grear aye Tr. Marcus aye Tr. Pietron aye Tr. Thill aye Tr. Toth aye Tr. Witko aye Trustee Marcus complimented Corporation Counsel Liston for ensuring that an estimated amount of Bond Counsel’s fee was included in the Resolution. Next, Trustee Toth presented Resolution 15-11, Authorizing a Contractual Agreement With William Blair & Company, LLC to Provide Investment Banking Services as an Exclusive Underwriter Relating to the Preparation and Sale of General Obligation Bonds, Series 2015, For the Village of Morton Grove. Trustee Toth explained that this Resolution will authorize an agreement with William Blair & Company LLC to act as an Exclusive Underwriter relating to the preparation and sale of General Obligation Bonds, Series 2015. Their fee will be paid from the proceeds of the sale of the bonds and is estimated to be $70,000. The fee is based on the structure and tax exempt status of the bonds. Trustee Toth moved to approve Resolution 15-11, seconded by Trustee Marcus. Motion passed: 6 ayes, 0 nays. Tr. Grear aye Tr. Marcus aye Tr. Pietron aye Tr. Thill aye Tr. Toth aye Tr. Witko aye Minutes of February 9, 2015 Board Meeting 7 XII. E. 3. 4. TRUSTEES’ REPORTS (continued) Trustee Toth: (continued) Trustee Toth then presented for a first reading Ordinance 15-02, Providing For the Issuance of Not to Exceed $11,500,000 General Obligation Bonds, Series 2015, of the Village of Morton Grove, Cook County, Illinois, to Pay Costs of General Municipal Improvements Within Said Village and to Refund Certain Outstanding Bonds of Said Village, Providing For the Levy of a Direct Annual Tax Sufficient to Pay the Principal Of and Interest On Said Bonds, and Authorizing the Sale of Said Bonds to William Blair & Company, LLC, Chicago, Illinois. She explained that the Village Administrator and Finance Director have researched the most favorable financing arrangement and have determined the Village should issue tax exempt General Obligation Installment Bonds in an amount not to exceed $11,500,000. This will enable the Village to refund the outstanding General Obligation Bonds, Series 2007, and provide $5 million in funding for capital projects identified in the 2015 Budget. There were no questions or comments from the Board. As this is a first reading, no vote will be taken this evening. Lastly, Trustee Toth presented for a first reading Ordinance 15-03, Authorizing the Village of Morton Grove to Document the Termination of Special Service Area Number 1. She explained that, in 1984, the Village established Special Service Area #1 in order to finance the construction of streets, storm sewers, water mains, and sanitary sewers in the industrial area west of Lehigh Avenue between Oakton and Lincoln Avenue. In 1985, the Village issued General Obligation bonds to finance these types of improvements in Special Service Area #1. The debt service on the bonds was paid by taxes levied on property owners in the Special Ser- vice Area. The Village refinanced those bonds during the 1993-94 fiscal year, resulting in a lower debt service payment and property tax levy, and the debt service was paid in full and the bonds fully retired in December 1997. The need for the Special Service Area no longer exists, and Cook County has recently requested the Village to adopt an ordinance to formally termi- nate Special Service Area #1. There were no questions or comments from the Board. As this is a first reading, no vote will be taken this evening. F. Trustee Witko: Trustee Witko had no report. XIII. OTHER BUSINESS NONE Minutes of February 9, 2015 Board Meeting 8 XIV. WARRANTS Trustee Toth presented the Warrant Register for this evening in the amount of $524,878.29. She moved to approve the Warrants as presented, seconded by Trustee Witko. Motion passed: 6 ayes, 0 nays. Tr. Grear aye Tr. Marcus aye Tr. Pietron aye Tr. Thill aye Tr. Toth aye Tr. Witko aye XV. 1. a. b. c. 2. a. b. c. RESIDENTS’ COMMENTS Benita LoGuidice commented that Trustee Grear had been “preaching to the choir” about people moving their cars off the street so Public Works can clear the snow. She said the Vil- lage could pass an ordinance or put in in the newspaper, but people will just keep doing it (not moving their cars). She said it’s not fair to expect Public Works to come back out to clear the street, once the person finally does move their car. She felt there should be a consequence to that person. She commented that some of the streets are awful, mostly because of car owners not moving their cars off the streets. Public Works Director Andy DeMonte said he’s reviewed Skokie’s ordinance related to this type of thing. He said it’s a problem every winter. But Skokie’s ordinance shows they have huge areas that are “exempt”. Mr. DeMonte said that, in the older part of Morton Grove, parking is very difficult; there’s just no place to put the cars. He said it’s not a problem for Public Works to come back out to clear a street, and recommended that the Village not pass an ordinance about this at this time. Mayor DiMaria said he understands Mrs. LoGuidice’s point but would defer to Mr. DeMonte. He added that residents should contact Public Works if there’s a snow problem on any particular block. Mrs. LoGuidice said, when she lived in Niles, the people in her subdivision were in the habit of moving their cars when a major snowstorm was predicted. She said we have to get people in Morton Grove in the same habit. Georgianne Brunner appeared before the Board to announce some upcoming fundraising events for Morton Grove Days. She encouraged all residents to support these “Eat & Earn” events. The first one, on February 25, will take place at Kappy’s between 5:00 p.m. and 8:00 p.m. If a patron mentions he/she is there for Morton Grove Days, Kappy’s will donate 20% of the customer’s bill to the Morton Grove Days Commission. Then, on March 26, Giordano’s will donate 20% of all dine-in, carryout, or delivery purchases made between 11:00 a.m. and midnight, to anyone who mentions Morton Grove Days. She also reminded everyone that anyone who donates $25 to the Morton Grove Days Commission will receive a “I Helped Save The Fireworks” tee-shirt. Order forms are available at Village Hall or on the Morton Grove Days website (mortongrovedays.org). Mayor DiMaria said the Village will get this information posted on its website and Facebook page as well. Minutes of February 9, 2015 Board Meeting 9 XVI. ADJOURNMENT Trustee Toth moved to adjourn the meeting, seconded by Trustee Marcus. Motion passed: 6 ayes, 0 nays. Tr. Grear aye Tr. Marcus aye Tr. Pietron aye Tr. Thill aye Tr. Toth aye Tr. Witko aye The meeting adjourned at 7:52 p.m. PASSED this 23rd day of February 2015 Trustee Grear __________ Trustee Marcus __________ Trustee Pietron __________ Trustee Thill __________ Trustee Toth __________ Trustee Witko __________ APPROVED by me this 23rd day of February 2015 Daniel P. DiMaria, Village President Board of Trustees, Morton Grove, Illinois APPROVED and FILED in my office this 24th day of February 2015. ______________________________________ Edilberto Ramos, Village Clerk Village of Morton Grove, Cook County, Illinois Minutes by: Teresa Cousar