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VILLAGE OF MORTON GROVE, ILLINOIS
COMPREHENSIVE ANNUAL
FINANCIAL REPORT
For the Year Ended
December 31, 2012
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-vii
FINANCIAL SECTION
INDEPENDENT AUDITOR’S REPORT .................................................................... 1-3
GENERAL PURPOSE EXTERNAL FINANCIAL STATEMENTS
Management’s Discussion and Analysis .................................................................. MD&A 1-13
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 ............................................................................. 20-75
Required Supplementary Information
Schedule of Revenues, Expenditures and Changes in Fund Balance -
Budget and Actual -
General Fund .................................................................................................. 76
Lehigh/Ferris Tax Increment Financing Fund ................................................ 77
Waukegan Road Tax Increment Financing Fund ........................................... 78
Schedule of Funding Progress
Illinois Municipal Retirement Fund ............................................................... 79
Sherriff’s Law Enforcement Personnel Plan .................................................. 80
Municipal Employees’ Retirement Fund ........................................................ 81
Police Pension Fund ....................................................................................... 82
Firefighters’ Pension Fund ............................................................................. 83
Other Postemployment Benefit Plan .............................................................. 84
Schedule of Employer Contributions
Illinois Municipal Retirement Fund ............................................................... 85
Sherriff’s Law Enforcement Personnel Plan .................................................. 86
Municipal Employees’ Retirement Fund ........................................................ 87
Police Pension Fund ....................................................................................... 88
Firefighters’ Pension Fund ............................................................................. 89
Other Postemployment Benefit Plan .............................................................. 90
Notes to Required Supplementary Information ................................................... 91
VILLAGE OF MORTON GROVE, ILLINOIS
TABLE OF CONTENTS (Continued)
Page(s)
FINANCIAL SECTION (Continued)
COMBINING AND INDIVIDUAL FUND FINANCIAL
STATEMENTS AND SCHEDULES
MAJOR GOVERNMENTAL FUNDS
Schedule of Expenditures - Budget and Actual - General Fund.......................... 92-94
Schedule of Revenues, Expenditures and Changes in
Fund Balance - Budget and Actual
Debt Service Fund .......................................................................................... 95
Capital Projects Fund ..................................................................................... 96
NONMAJOR GOVERNMENTAL FUNDS
Combining Balance Sheet ................................................................................... 97-98
Combining Statement of Revenues, Expenditures
and Changes in Fund Balances .......................................................................... 99-100
Schedule of Revenues, Expenditures and
Changes in Fund Balance - Budget and Actual
Motor Fuel Tax Fund ...................................................................................... 101
Commuter Parking Facility Fund ................................................................... 102
9-1-1 Emergency Telephone System Fund ..................................................... 103
Economic Development Fund ........................................................................ 104
Fire Alarm Fund ............................................................................................. 105
NONMAJOR PROPRIETARY FUNDS
Combining Statement of Net Position ................................................................. 106
Combining Statement of Revenues, Expenditures
and Changes in Net Position ............................................................................. 107
Combining Statement of Cash Flows .................................................................. 108
FIDUCIARY FUNDS
Pension Trust Funds
Combining Statement of Plan Net Position .................................................... 109
Combining Statement of Changes in Plan Net Position ................................. 110
COMPONENT UNIT - PUBLIC LIBRARY
Statement of Net Position and Balance Sheet ..................................................... 111
Schedule of Revenues, Expenditures and Changes in
Fund Balance - Budget and Actual and Statement of Activities ....................... 112
VILLAGE OF MORTON GROVE, ILLINOIS
TABLE OF CONTENTS (Continued)
Page(s)
STATISTICAL SECTION (UNAUDITED)
Financial Trends
Net Position by Component ..................................................................................... 113
Change in Net Position............................................................................................. 114-116
Fund Balances of Governmental Funds ................................................................... 117
Change in Fund Balances of Governmental Funds .................................................. 118-119
Revenue Capacity
Assessed and Actual Value of Taxable Property ..................................................... 120
Property Tax Rates - Direct and Overlapping Governments ................................... 121
Principal Property Taxpayers ................................................................................... 122
Property Tax Levies and Collections ....................................................................... 123
Debt Capacity
Ratios of Outstanding Debt by Type ........................................................................ 124
Ratios of General Bonded Debt Outstanding ........................................................... 125
Schedule of Direct and Overlapping Bonded Debt .................................................. 126
Schedule of Legal Debt Margin ............................................................................... 127
Demographic and Economic Information
Demographic and Economic Information ................................................................ 128
Principal Employers ................................................................................................. 129
Operating Information
Full-Time Equivalent Employees ............................................................................. 130
Operating Indicators ................................................................................................. 131
Capital Asset Statistics ............................................................................................. 132
COMPLIANCE SECTION
INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE
WITH STATE OF ILLINOIS PUBLIC ACT 85-1142 ............................................. 133
INTRODUCTORY SECTION
i
VILLAGE OF MORTON GROVE, ILLINOIS
PRINCIPAL OFFICIALS AND OFFICERS
December 31, 2012
ELECTED TITLE/POSITION TERM/APPOINTMENT ENDS
Dan Staackmann Mayor April 2013
Daniel DiMaria Trustee April 2013
Larry Gomberg Trustee April 2013
Bill Grear Trustee April 2013
Shel Marcus Trustee April 2015
John Thill Trustee April 2015
Maria Toth Trustee April 2015
Tony Kalogerakos Village Clerk April 2013
APPOINTED
Ryan Horne Village Administrator December 31, 2012
Remy Navarrete Finance Director December 31, 2012
John Said Economic Development Director December 31, 2012
Teresa Hoffman Liston Corporation Counsel December 31, 2012
Thomas Friel Fire Chief December 31, 2012
Mark Erickson Police Chief December 31, 2012
John Hill EMA Director December 31, 2012
Andrew DeMonte Public Works Director December 31, 2012
Elizabeth M. Rochford Adjudication Hearing Officer December 31, 2012
Frank Tennant Village Prosecutor December 31, 2012
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) and component unit (the
Morton Grove Public Library). 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 included as a
discretely presented component unit since a separately elected Board of Trustees governs it.
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 remain the same in 2012 due to economic
recession.
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 recognized 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 4 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 (2) 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.
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;
Board of Trustees and
Citizens of the Village of Morton Grove
viii
• 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 $9.8Million 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, 2011. This was the twenty-fourth 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 accomplished 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,
______________________________ ______________________________
Ryan J. Horne Remy Navarrete
Village Administrator 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, the
aggregate discretely presented component unit, each major fund and the aggregate remaining
fund information of the Village, as of December 31, 2012, 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. 63, Financial Reporting of Deferred Outflows of
Resources, Deferred Inflows of Resources, and Net Position and GASB Statement No. 65, Items
Previously Reported as Assets and Liabilities during the year ended December 31, 2012.
Statement No. 63 added new classifications on the statements of position and changed net assets
to net position. Statement No. 65 changed the classifications of certain items on the statement of
position to the new classifications contained in GASB Statement No 63.
Other Matters
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.
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 of
Morton Grove, Illinois as of and for the year ended December 31, 2011, the prior year in the
period ended December 31, 2012 (none of which is presented herein), and we expressed
unqualified opinions on those financial statements. Those audits were conducted for purposes of
forming an opinion on the financial statements as a whole.
The schedules of revenues, expenditures (expenses) and changes in fund balance (net position) -
budget and actual for each fund with comparative actual is presented for purposes of additional
analysis and is not a required part of the financial statements. Such information is the
responsibility of management and was derived from and relates directly to the underlying
- 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, 2012
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, 2012. 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 net position decreased as a result of this year’s operations. Net position of
governmental activities decreased by $920,594, while net position of the business-type activities
increased by $1,307,458 resulting in total ending net position for the year of $43,109,525.
During the year, government-wide revenues before transfers for the governmental and business-
type activities total $39,317,316, while expenses totaled $38,930,452, resulting in the increase in
net position of $386,864.
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.
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).
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 2
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 (b usiness-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.
The Village includes one separate legal entity in its report. The Morton Grove Public Library is presented
as a discretely component unit. Financial information for the component unit is reported separ ately from
the financial information presented for the primary government itself.
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 Project Fund, all of which are considered to be Major
Funds. Data from the other seven governmental funds are 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.
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 3
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 76 of this report. The combining statements referred to earlier
in connection with non-major governmental funds are presented immediately following the required
supplementary information. Combining and individual fund statements and schedules for the Village can
be found on pages beginning with page 92 of this report. Additionally, the combining and individual fund
statements for the component unit can be found on pages beginning with page 111 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
$43,109,525 at December 31, 2012, compared to $42,971,082 at December 31, 2011:
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 4
A large portion of the Village’s net position, $48,125,108, 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, $5,991,974, of the Village’s net assets represents resources that are subject to
external restrictions on how they may be used, including restrictions for future street improvements, debt
service payments, public safety, and future capital development.
NORMAL IMPACTS
There are six basic (normal) transactions that will affect the comparability of the Statement of Net Assets
summary presentation:
1) Net Results of Activities – which will impact (increase/decrease) current assets and unrestricted
net position.
2) Borrowing for Capital – which will increase current assets and long-term debt outstanding.
3) Spending Borrowed Proceeds on New Capital – which will reduce current assets and increase
capital assets. There is a second impact, an increase in invested in capital assets and an increase
in related net debt, which will not change the net investment in capital assets.
4) Spending Nonborrowed Current Assets on New Capital – which will (a) reduce current assets
and increase capital assets and (b) will reduce unrestricted net position and increase net
investment in capital assets.
Village of Morton Grove Net Position (in thousands)
Governmental Business-Type
Activities Activities Total
Category 12/31/12 12/31/11 12/31/12 12/31/11 12/31/12 12/31/11
Current and other assets 32,878$ 34,935$ 4,572$ 3,476$ 37,450$ 38,411$
Capital assets 57,994 59,221 7,767 7,936 65,761 67,157
Deferred outflows 68 - 14 - 82 -
Total assets and deferred outflows 90,940 94,156 12,353 11,412 103,293 105,568
Current and other Liabilities 1,571 2,249 1,209 993 2,780 3,242
Long-Term liabilities 42,475 43,899 4,991 5,518 47,467 49,417
Deferred inflows 9,937 9,937 - - 9,937 9,937
Total liabilities and deferred inflows 53,983 56,085 6,200 6,511 60,183 62,596
Net position:
Net investment in capital assets 44,017 44,804 4,108 610 48,125 45,414
Restricted 5,992 6,089 - - 5,992 6,089
Unrestricted (13,052) (12,822) 2,045 4,290 (11,007) (8,532)
Total net position 36,957$ 38,071$ 6,153$ 4,901$ 43,110$ 42,971$
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 5
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.
Village of Morton Grove Changes in Net Position (in thousands)
Governmental Business-Type
Activities Activities Total
Category 12/31/12 12/31/11 12/31/12 12/31/11 12/31/12 12/31/11
Revenues
Program revenues
Charges for services 3,541$ 3,621$ 9,040$ 7,617$ 12,581$ 11,238$
Operating Grants 1,002 882 - - 1,002 882
Capital Grants 158 279 64 64 222 343
General revenues
Taxes 24,913 24,295 - - 24,913 24,295
Investment income 27 74 14 15 41 89
Miscellaneous 262 813 296 298 558 1,111
Total revenues 29,903 29,964 9,414 7,994 39,317 37,958
Expenses
General government 5,635 2,990 5,635 2,990
Public safety 18,527 18,360 18,527 18,360
Streets and sidewalks 3,548 4,685 3,548 4,685
Vehicle maintenance 816 738 816 738
Health and human services 266 255 266 255
Community development 471 331 471 331
Building and inspectional services 700 534 700 534
Interest 861 1,043 861 1,043
Water and sewer 6,286 5,371 6,286 5,371
Solid Waste 1,821 1,818 1,821 1,818
Municipal Parking - - - -
Total expenses 30,824 28,936 8,107 7,189 38,931 36,125
Change in net position (921) 1,028 1,307 805 386 1,833
Prior period adjustment (193) - (55) 74 (248) 74
Net position - January 1 38,071 37,043 4,901 4,021 42,972 41,064
Net position - December 31 36,957$ 38,071$ 6,153$ 4,901$ 43,110$ 42,971$
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 6
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.
GOVERNMENTAL ACTIVITIES
Revenues:
Revenues for governmental activities totaled $29,903,311 at December 31, 2012.
Property tax (and replacement tax) continues to be the Village’s largest revenue source totaling
$12,970,383 representing 43.4% of total governmental activity revenue. Sales tax revenue was
$5,940,931 or 19.9% of total governmental activity revenue. Charges for Services revenue was
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 7
$3,541,860 or 11.8% of total governmental activity revenue. State income tax revenue was
$2,044,675 or 6.8% of total governmental activity revenue. Miscellaneous taxes revenue (local
use, real estate transfer, hotel & motel tax, food & beverage, gasoline tax) was $1,604,098 or
5.4% of total governmental activity revenue. Telecommunication tax was $1,233,283 or 4 .1% of
total governmental activity revenue. A utility tax (Electric & Natural gas tax) was $1,119,227 or
3.7% of total governmental activity revenue.
Comparison with Prior Year.
Property tax and replacement tax revenue decreased by $174,892 or 1.3% from prior year. Sales
tax revenue increased by $338,112 or 6.0% from prior year. Charges for Services revenue
decreased by $78,647 or 2.2% from prior year. State income tax revenue increased by $247,517
or 13.8% from prior year. Miscellaneous taxes revenue (local use, real estate transfer, hotel &
motel tax, food & beverage, gasoline tax) increased by $251,288 or 18.6% from prior year.
Telecommunication increased by $15,801 or 1.3% from prior year. A utility tax (Electric &
Natural gas tax) decreased by $34,897 or 3.0% from prior year
The following table graphically depicts the major revenue sources of the Village.
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 8
Prior Year Revenue by Source – Governmental Activities – For Comparison
Expenses
For the year ended December 31, 2012, expenses for governmental activities were $30,823,905 at
December 31, 2011 and $28,935,877 at December 31, 2011, an increase of $1,888,028, or 6.5%. The key
change during the year for the governmental activity expenses is described below:
Administration, Police, Fire, Street and Sidewalks and Vehicle Maintenance were over budget.
The largest budget variances occurred in personal services.
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.
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 9
BUSINESS-TYPE ACTIVITIES
Business-Type activities posted total revenues of $9,349,883, while the costs of all business-type
activities totaled $8,106,547. This results in a surplus of $1,243,336 prior to net contribution of $64,122.
In 2011, revenues of $7,930,691 exceed expenses of $7,189,536, resulting in a surplus of $741,135 prior
to net contribution of $64,122.
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 2012 the Village water rate increased by 28% resulting in the current water rate charge of $7.76 per
1,000 Gallon. Water and Sewer Fund operating revenues increased by $1,333,650 or 23.1%, 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. Solid
Waste operating revenues increased by $57,665 or 3.2%.
- 2,000,000 4,000,000 6,000,000 8,000,000 10,000,000 12,000,000 14,000,000 16,000,000 18,000,000 20,000,000
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Expense and Program Revenues - Governmental Activities
December 31, 2012
Revenues
Expenses
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 10
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 2012
increased by $30,665 or 224.5% from prior year total of $13,660. The Parking lot opened January 2011.
Expenses
Total expenses for water and sewer fund activities totaled $6,286,120, an increase of $915,089, or 17.0%
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 $1,820,057, an increase of $1,552, or .01%from
prior year.
Total expenses from Municipal Parking Fund activities totaled $370 or 100% from prior year.
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.
-
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Expense and Program Revenues - Business-Type Activities
December 31, 2012
Revenues
Expenses
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 11
The Village’s governmental funds reported combining ending fund balances of $21,443,228, which is
$1,191,550, or 5.3% lower than last year’s total of $22,634,778. Of this $21,443,228 total, $3,137,078 or
approximately 14.6% of the fund balance constitutes unassigned fund balance.
General Fund: The General Fund reported a deficit for the year of $442,599. As previously discussed,
this deficit was primarily a result of Administration, Police, Fire, Street and Sidewalks and Vehicle
Maintenance increases in personal services.
The General Fund is the chief operating fund of the Village. At December 31, 2012, unassigned fund
balance in the General Fund was $5,093,952, which represents 74.2% of the total fund balance of the
General Fund. As a measure of the General Fund’s liquidity, it is useful to compare unassigned fund
balance to total expenditures. Unassigned fund balance in General Fund represents approximately 21.5%
of total General Fund expenditures.
Lehigh Ferris TIF Fund: Reported a fund balance increase of $1,624,517 due to incremental property
tax revenue exceeding the expenditures for 2012.
Waukegan Road TIF Fund: Reported a fund balance declined of $230,888 as a result of debt service
costs exceeding the incremental property tax revenue.
Debt Service Fund: Reported a fund balance declined of $39,572 as a result of debt service costs
exceeding the property tax revenue allocated.
Capital Projects Fund: Reported a fund balance decrease of $1,942,556 primarily as a result of various
Capital Project Program implemented in 2012.
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 as a major proprietary fund. The Village reports two
nonmajor 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 $2.51 per thousand gallons a 25.00% increase from 2011. Water is then sold to all
residential municipal customers at a rate of $8.82 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, 2012 was $65,761,359 (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 5 of this CAFR.
VILLAGE OF MORTON GROVE, ILLINOIS
MANAGEMENT’S DISCUSSION AND ANALYSIS (CONTINUED)
(See independent auditor’s report.)
MD&A 12
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 7 on page 38-46 of this report.
Long-Term Debt
At year-end, the Village had total outstanding debt of $25,022,954, as compared to $28,253,391 the
previous year, a decrease of $3,230,437, or 12.9% which included the retirement of revolving loans
during the year coupled with principal retirements that reduced the outstanding liability on the
bonds.
The following is a comparative statement of outstanding debt (excluding intergovernmental
agreements).
12/31/12 12/31/11 12/31/12 12/31/11 12/31/12 12/31/11
Construction in Progress -$ 3,765$ 2,082$ 1,979$ 2,082$ 5,744$
Right of Ways 42,921 42,996 - - 42,921 42,996
Infrastructure 7,087 3,796 - - 7,087 3,796
Buildings and Improvements 6,865 7,454 5,112 5,309 11,977 12,763
Machinery, Equipment and Vehicles 1,121 1,199 573 648 1,694 1,847
57,994$ 59,210$ 7,767$ 7,936$ 65,761$ 67,146$
Capital Assets - Net of Depreciation (in thousands)
Governmental Business-Type
Total
Activities Activities Total
Type of Debt
12/31/12 12/31/11 12/31/12 12/31/11 12/31/12 12/31/11
General Obligation Bonds 18,958$ 21,073$ 4,767$ 5,347$ 23,725$ 26,420$
Revolving loans - 325 - - - 325
Installment Notes 1,298 1,508 - - 1,298 1,508
20,256$ 22,906$ 4,767$ 5,347$ 25,023$ 28,253$ 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 13
Economic Factors and Future Prospects
The Village’s elected and appointed officials considered many factors when setting the Calendar
year 2013 budget, tax rates, and fees charged for governmental and business-type activities. One of
those factors is the economy. While some economic indicators are pointing to a slow recovery out
of the 2008/2009 recession, the unemployment rate for the Village continued to stay high at 8.9%
for 2012 and interest rates have remained very low.
During the past two fiscal years, revenues have declined dramatically. Especially concerning are
intergovernmental revenues received from state and federal agencies. The delay in income tax
revenue from the State of Illinois is currently 4 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 payments.
All of these indicators were taken into account when adopting the budget for 2013. At the time of
preparing the 2013 budget, it was projected that the Village would continue to experience little or
no growth in revenues. Expenditures continued to be trimmed to the fullest extent possible without
impacting core services provided. Plans for beyond 2013 are also being developed to ensure the
Village’s long-term economic sustainability
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.
Component
Unit
Governmental Business-Type Morton Grove
Activities Activities Total Public Library
ASSETS
Cash and cash equivalents 4,285,209$ 3,751,572$ 8,036,781$ 2,417,873$
Investments 4,244,399 - 4,244,399 -
Receivables (net, where applicable,
of allowances for uncollectibles)
Property taxes 10,009,301 - 10,009,301 3,053,876
Sales tax 1,565,138 - 1,565,138 -
State income tax 460,312 - 460,312 -
Accrued interest 18,484 - 18,484 -
Accounts and allotments 983,930 826,637 1,810,567 -
Due from other governments 151,501 - 151,501 25,000
Due from (to) other funds 37,737 (37,737) - -
Loan to developer 1,700,000 - 1,700,000 -
IRMA excess surplus 630,657 - 630,657 -
IPBC terminal reserve 517,636 - 517,636 -
Prepaid expenses 103,495 31,847 135,342 20,691
Land held for resale 8,169,381 - 8,169,381 -
Net pension asset - - - 70,993
Capital assets not being depreciated 42,921,414 2,081,771 45,003,185 79,000
Capital assets (net of
accumulated depreciation)15,072,667 5,685,507 20,758,174 526,466
Total assets 90,871,261 12,339,597 103,210,858 6,193,899
DEFERRED OUTFLOWS OF RESOURCES
Unamortized loss on refunding 68,343 13,554 81,897 -
Total deferred outflows of resources 68,343 13,554 81,897 -
Total assets and deferred outflows
of resources 90,939,604 12,353,151 103,292,755 6,193,899
Primary Government
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF NET POSITION
December 31, 2012
(This statement is continued on the following page.)
- 4 -
Component
Unit
Governmental Business-Type Morton Grove
Activities Activities Total Public Library
LIABILITIES
Accounts payable 494,727$ 1,023,531$ 1,518,258$ 19,043$
Accrued salaries and wages 460,313 94,361 554,674 68,996
Other payables 27,542 - 27,542 -
Accrued interest payable 73,399 9,620 83,019 -
Deposits - refundable 263,330 5,050 268,380 -
Unearned revenue 249,609 76,777 326,386 -
Due to fiduciary funds 1,389 - 1,389 -
Noncurrent liabilities
Due within one year 3,004,386 591,000 3,595,386 7,861
Due in more than one year 39,470,847 4,400,307 43,871,154 44,544
Total liabilities 44,045,542 6,200,646 50,246,188 140,444
DEFERRED INFLOWS OF RESOURCES
Unearned revenue - property taxes 9,937,042 - 9,937,042 3,041,037
Total deferred inflows of resources 9,937,042 - 9,937,042 3,041,037
Total liabilities and deferred inflows
of resources 53,982,584 6,200,646 60,183,230 3,181,481
NET POSITION
Net investment in capital assets 44,017,021 4,108,087 48,125,108 605,466
Restricted for
Public safety 599,248 - 599,248 -
Community development 12,360,035 - 12,360,035 -
Highways and streets 448,601 - 448,601 -
Specific property tax levies 7,357 - 7,357 71,346
Committed
Special reserve - facility expansion - - - 80,332
Unrestricted (20,475,242) 2,044,418 (18,430,824) 2,255,274
TOTAL NET POSITION 36,957,020$ 6,152,505$ 43,109,525$ 3,012,418$
STATEMENT OF NET POSITION (Continued)
December 31, 2012
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 5,634,828$ 2,870,140$ -$ -$
Public safety 18,526,759 668,063 339,257 -
Streets and sidewalks 3,547,591 1,473 663,021 157,618
Vehicle maintenance 816,073 - - -
Health and human services 266,405 2,184 - -
Community development 470,695 - - -
Building and inspectional services 699,282 - - -
Interest 862,272 - - -
Total governmental activities 30,823,905 3,541,860 1,002,278 157,618
Business-Type Activities
Water and sewer 6,286,120 7,106,948 - 64,122
Solid waste 1,820,057 1,888,288 - -
Municipal parking 370 44,325 - -
Total business-type activities 8,106,547 9,039,561 - 64,122
TOTAL PRIMARY GOVERNMENT 38,930,452$ 12,581,421$ 1,002,278$ 221,740$
COMPONENT UNIT
Morton Grove Public Library
Culture and recreation 2,958,122$ 42,401$ 23,863$ -$
TOTAL COMPONENT UNIT 2,958,122$ 42,401$ 23,863$ -$
CHANGE IN NET POSITION
NET POSITION, JANUARY 1
Program Revenues
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF ACTIVITIES
For the Year Ended December 31, 2012
- 6 -
Component
Unit
Morton Grove
Governmental Business-Type Public
Activities Activities Total Library
(2,764,688)$ -$ (2,764,688)$ -$
(17,519,439) - (17,519,439) -
(2,725,479) - (2,725,479) -
(816,073) - (816,073) -
(264,221) - (264,221) -
(470,695) - (470,695) -
(699,282) - (699,282) -
(862,272) - (862,272) -
(26,122,149) - (26,122,149) -
- 884,950 884,950 -
- 68,231 68,231 -
- 43,955 43,955 -
- 997,136 997,136 -
(26,122,149) 997,136 (25,125,013) -
- - - (2,891,858)
- - - (2,891,858)
General Revenues
Taxes
Property 12,620,923 - 12,620,923 2,983,267
Personal property replacement 349,460 - 349,460 25,206
Sales 5,940,931 - 5,940,931 -
Utility 1,119,227 - 1,119,227 -
Local use 366,252 - 366,252 -
Telecommunications 1,233,283 - 1,233,283 -
Income 2,044,675 - 2,044,675 -
Real estate transfer 341,079 - 341,079 -
Hotel/motel 72,760 - 72,760 -
Food and beverage 362,207 - 362,207 -
Gasoline 270,238 - 270,238 -
Other 191,562 - 191,562 -
Investment income 26,846 13,740 40,586 1,420
Miscellaneous 262,112 296,582 558,694 2,862
Total 25,201,555 310,322 25,511,877 3,012,755
CHANGE IN NET POSITION (920,594) 1,307,458 386,864 120,897
NET POSITION, JANUARY 1 38,070,572 4,900,510 42,971,082 2,849,175
PRIOR PERIOD ADJUSTMENT (192,958) (55,463) (248,421) 42,346
NET POSITION, JANUARY 1, RESTATED 37,877,614 4,845,047 42,722,661 2,891,521
NET POSITION, DECEMBER 31 36,957,020$ 6,152,505$ 43,109,525$ 3,012,418$
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 1,586,131$ 1,295,807$ 62,275$ -$ 322,177$ 1,018,819$ 4,285,209$
Investments - 1,245,183 - 168,330 2,736,411 94,475 4,244,399
Receivables
Property taxes 8,808,007 15,016 16,352 1,118,470 51,456 - 10,009,301
Sales tax 1,333,388 - - 147,500 6,250 78,000 1,565,138
State income tax 460,312 - - - - - 460,312
Accrued interest - - - - 18,484 - 18,484
Accounts and allotments 846,351 - - - - 137,579 983,930
Due from other governments 151,501 - - - - - 151,501
Due from other funds 983,376 - - - - - 983,376
Loan to developer - 1,700,000 - - - - 1,700,000
Advances to other funds 1,546,190 35,714 - - - - 1,581,904
IRMA excess surplus reserve 630,657 - - - - - 630,657
IPBC terminal reserve 517,636 - - - - - 517,636
Prepaid expenses 103,495 - - - - - 103,495
Land held for resale - 8,169,381 - - - - 8,169,381
Total assets 16,967,044 12,461,101 78,627 1,434,300 3,134,778 1,328,873 35,404,723
DEFERRED OUTFLOWS OF RESOURCES
None - - - - - - -
Total deferred outflows of resources - - - - - - -
TOTAL ASSETS AND DEFERRED OUTFLOWS
OF RESOURCES 16,967,044$ 12,461,101$ 78,627$ 1,434,300$ 3,134,778$ 1,328,873$ 35,404,723$
ASSETS
VILLAGE OF MORTON GROVE, ILLINOIS
BALANCE SHEET
GOVERNMENTAL FUNDS
December 31, 2012
- 8 -
Lehigh/Ferris Waukegan Debt Capital
General TIF Road TIF Service Projects Nonmajor Total
LIABILITIES
Accounts payable and retainage payable 371,700$ 65,352$ -$ -$ 11,841$ 45,834$ 494,727$
Accrued salaries and wages 460,313 - - - - - 460,313
Other payables 27,542 - - - - - 27,542
Unearned revenue 202,985 - - - 46,624 - 249,609
Deposits - refundable 263,330 - - - - - 263,330
Due to other funds - - - 694,699 - 250,940 945,639
Due to fiduciary funds 1,389 - - - - - 1,389
Advances from other funds - - 1,468,930 - - 112,974 1,581,904
Total liabilities 1,327,259 65,352 1,468,930 694,699 58,465 409,748 4,024,453
DEFERRED INFLOWS OF RESOURCES
Unavailable revenue-property taxes 8,771,986 - - 1,113,813 51,243 - 9,937,042
Total deferred inflows of resources 8,771,986 - - 1,113,813 51,243 - 9,937,042
Total liabilities and deferred inflows of resources 10,099,245 65,352 1,468,930 1,808,512 109,708 409,748 13,961,495
FUND BALANCES
Nonspendable
Prepaid expenses 103,495 - - - - - 103,495
Advance to other funds 1,546,190 35,714 - - - - 1,581,904
Restricted for
Public safety 116,805 - - - - 482,443 599,248
Capital improvements - unspent bond proceeds - - - - 2,481,828 - 2,481,828
Community development - 12,360,035 - - - - 12,360,035
Highways and streets - - - - - 448,601 448,601
Specific property tax levies 7,357 - - - - - 7,357
Unrestricted
Committed for commuter improvements - - - - - 180,440 180,440
Assigned for capital improvements - - - - 543,242 - 543,242
Unassigned 5,093,952 - (1,390,303) (374,212) - (192,359) 3,137,078
Total fund balances 6,867,799 12,395,749 (1,390,303) (374,212) 3,025,070 919,125 21,443,228
TOTAL LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES 16,967,044$ 12,461,101$ 78,627$ 1,434,300$ 3,134,778$ 1,328,873$ 35,404,723$
RESOURCES, AND FUND BALANCES
LIABILITIES, DEFERRED INFLOWS OF
See accompanying notes to financial statements.
- 9 -
Primary
Government
FUND BALANCES OF GOVERNMENTAL FUNDS 21,443,228$
Amounts reported for governmental activities in the
statement of net assets are different because:
Capital assets used in governmental activities are
not financial resources and, therefore, are not
reported in the governmental funds 57,994,081
Interest payable is not due and payable in the current period
and, therefore, not reported in the governmental funds (73,399)
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 (18,958,300)
Installment notes payable (1,297,954)
Intergovernmental agreement payable (3,457,411)
Net pension obligation (15,431,631)
Net other postemployment benefits obligation (2,728,038)
Compensated absences (540,922)
The unamortized bond premium is not a current financial
resource and, therefore, is not reported in the
governmental funds (70,411)
The unamortized bond discount is not a current financial
resource and, therefore, is not reported in the
governmental funds 9,434
The unamortized loss on bond refunding is shown as a reduction of
long-term liabilities on the statement of net assets 68,343
NET POSITION OF GOVERNMENTAL ACTIVITIES 36,957,020$
VILLAGE OF MORTON GROVE, ILLINOIS
RECONCILIATION OF FUND BALANCES OF GOVERNMENTAL FUNDS TO THE
GOVERNMENTAL ACTIVITIES IN THE STATEMENT OF NET POSITION
December 31, 2012
See accompanying notes to financial statements.
- 10 -
Lehigh/Ferris Waukegan Debt
General TIF Road TIF Service
REVENUES
Taxes 19,669,421$ 2,282,139$ 581,843$ 1,687,273$
Licenses and permits 1,472,977 - - -
Intergovernmental 353,191 - - 81,610
Surcharges - - - -
Charges for services 805,325 - - -
Fines 609,450 - - -
Investment income 4,847 1,627 180 1,110
Cable TV franchise fees 322,937 - - -
Miscellaneous 206,598 29,377 - -
Total revenues 23,444,746 2,313,143 582,023 1,769,993
EXPENDITURES
Current
General government 2,960,966 - - -
Public safety 16,559,777 - - -
Streets and sidewalks 2,261,284 - - -
Vehicle maintenance 816,073 - - -
Health and human services 263,187 - - -
Community development 105,595 35,846 428 -
Building and inspectional services 698,263 - - -
Debt service
Principal retirement - 270,000 609,965 1,770,022
Interest and fiscal charges - 317,428 202,518 339,543
Capital outlay
Capital projects - 65,352 - -
Total expenditures 23,665,145 688,626 812,911 2,109,565
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (220,399) 1,624,517 (230,888) (339,572)
OTHER FINANCING SOURCES (USES)
Transfers in (out)(300,000) - - 300,000
Proceeds from sale of capital assets 77,800 - - -
Total other financing sources (uses)(222,200) - - 300,000
NET CHANGE IN FUND BALANCES (442,599) 1,624,517 (230,888) (39,572)
FUND BALANCES (DEFICIT), JANUARY 1 7,310,398 10,771,232 (1,159,415) (334,640)
FUND BALANCES (DEFICIT), DECEMBER 31 6,867,799$ 12,395,749$ (1,390,303)$ (374,212)$
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
For the Year Ended December 31, 2012
- 11 -
Capital
Projects Nonmajor Total
106,695$ 312,000$ 24,639,371$
- - 1,472,977
6,581 808,765 1,250,147
- 273,226 273,226
- 262,654 1,067,979
- - 609,450
17,286 1,796 26,846
- - 322,937
4,403 - 240,378
134,965 1,658,441 29,903,311
- - 2,960,966
- 281,514 16,841,291
- 712,802 2,974,086
- - 816,073
- - 263,187
- 625,119 766,988
- - 698,263
- - 2,649,987
- - 859,489
2,077,521 199,458 2,342,331
2,077,521 1,818,893 31,172,661
(1,942,556) (160,452) (1,269,350)
- - -
- - 77,800
- - 77,800
(1,942,556) (160,452) (1,191,550)
4,967,626 1,079,577 22,634,778
3,025,070$ 919,125$ 21,443,228$
See accompanying notes to financial statements.
- 12 -
Primary
Government
NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FUNDS (1,191,550)$
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 280,314
Depreciation expense does not require the use of current financial statement resources,
and therefore, is not reported as in expenditure in the governmental funds (1,400,431)
Governmental funds do not report compensated absences; however, they are
recognized as a reduction to expenses on the statement of activities (25,990)
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 2,649,987
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 296,293
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 (2,235)
The change in net pension obligation and asset is not reported in governmental
funds, but is reported in the statement of activities (911,139)
The change in net other postemployment benefits obligations are reported
only in the statement of activities (508,747)
Loss on disposal of capital assets (public safety expenses)(106,548)
The change in the accrued interest payable on long-term debt is reported
as interest expense on the statement of activities 5,427
CHANGES IN NET POSITION OF GOVERNMENTAL ACTIVITIES (920,594)$
For the Year Ended December 31, 2012
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
(This statement is continued on the following page.)
- 13 -
Water
and Sewer Nonmajor Total
CURRENT ASSETS
Cash and cash equivalents 3,503,016$ 248,556$ 3,751,572$
Receivables 765,350 61,287 826,637
Prepaid expenses - 31,847 31,847
Total current assets 4,268,366 341,690 4,610,056
NONCURRENT ASSETS
Capital assets not being depreciated 2,081,771 - 2,081,771
Capital assets - net of accumulated depreciation 5,685,507 - 5,685,507
Total noncurrent assets 7,767,278 - 7,767,278
Total assets 12,035,644 341,690 12,377,334
DEFERRED OUTFLOWS OF RESOURCES
Unamortized loss on refunding 13,554 - 13,554
Total deferred outflows of resources 13,554 - 13,554
Total assets and deferred outflows of resources 12,049,198 341,690 12,390,888
CURRENT LIABILITIES
Accounts payable 716,669 306,862 1,023,531
Accrued salaries and wages 94,361 - 94,361
Accrued interest payable 9,620 - 9,620
Refundable deposits 5,050 - 5,050
Unearned revenue 35,917 40,860 76,777
Due to other funds 37,737 - 37,737
Bonds payable - current maturities 591,000 - 591,000
Total current liabilities 1,490,354 347,722 1,838,076
LONG-TERM LIABILITIES
Bonds payable 4,186,964 - 4,186,964
Net other postemployment benefit obligation 213,343 - 213,343
Total long-term liabilities 4,400,307 - 4,400,307
Total liabilities 5,890,661 347,722 6,238,383
DEFERRED INFLOWS OF RESOURCES
None - - -
Total deferred inflows of resources - - -
Total assets and deferred inflows of resources 5,890,661 347,722 6,238,383
NET POSITION
Net investment in capital assets 4,108,087 - 4,108,087
Unrestricted (deficit)2,050,450 (6,032) 2,044,418
TOTAL NET POSITION 6,158,537$ (6,032)$ 6,152,505$
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
December 31, 2012
See accompanying notes to financial statements.
- 14 -
Water and
Sewer Nonmajor Total
OPERATING REVENUES
Water sales 6,273,250$ -$ 6,273,250$
Sewer charges 826,327 - 826,327
Waste charges - 1,888,288 1,888,288
Meter and connection fees 7,371 - 7,371
Parking charges - 44,325 44,325
Miscellaneous 113,636 - 113,636
Total operating revenues 7,220,584 1,932,613 9,153,197
OPERATING EXPENSES
Personal services 1,493,546 - 1,493,546
Contractual services and other charges 816,259 1,820,057 2,636,316
Water purchases 2,729,290 - 2,729,290
Capital outlay 280,972 - 280,972
Commodities 249,161 370 249,531
Administrative fees 109,500 - 109,500
Utilities 77,266 - 77,266
Total operating expenses 5,755,994 1,820,427 7,576,421
OPERATING INCOME BEFORE DEPRECIATION 1,464,590 112,186 1,576,776
DEPRECIATION 291,023 - 291,023
OPERATING INCOME 1,173,567 112,186 1,285,753
NONOPERATING REVENUES (EXPENSES)
Rental income 182,946 - 182,946
Investment income 13,448 292 13,740
Interest expense and fiscal agent fees (239,103) - (239,103)
Total nonoperating revenues (expenses)(42,709) 292 (42,417)
NET INCOME BEFORE CONTRIBUTIONS 1,130,858 112,478 1,243,336
CONTRIBUTIONS 64,122 - 64,122
CHANGE IN NET POSITION 1,194,980 112,478 1,307,458
NET POSITION (DEFICIT), JANUARY 1, AS PREVIOUSLY REPORTED 5,019,020 (118,510) 4,900,510
PRIOR PERIOD ADJUSTMENT (55,463) - (55,463)
NET POSITION (DEFICIT), JANUARY 1, RESTATED 4,963,557 (118,510) 4,845,047
NET POSITION (DEFICIT), DECEMBER 31 6,158,537$ (6,032)$ 6,152,505$
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN NET POSITION
PROPRIETARY FUNDS
For the Year Ended December 31, 2012
See accompanying notes to financial statements.
- 15 -
Water and
Sewer Nonmajor Total
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers and users 7,112,459$ 1,938,609$ 9,051,068$
Receipts from miscellaneous revenues 113,636 - 113,636
Payments to suppliers (3,996,566) (1,855,850) (5,852,416)
Payments to employees (1,440,142) - (1,440,142)
Payments to other funds (109,500) - (109,500)
Net cash from operating activities 1,679,887 82,759 1,762,646
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
Receipts from other funds 37,737 11,275 49,012
Rental receipts 182,946 - 182,946
Net cash from noncapital
financing activities 220,683 11,275 231,958
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES
Intergovernmental 64,122 - 64,122
Purchase of capital assets (122,763) - (122,763)
Bond principal payments (581,951) - (581,951)
Interest payments (230,652) - (230,652)
Net cash from capital and
related financing activities (871,244) - (871,244)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest received 13,448 292 13,740
Proceeds from sale of investments 1,584,032 - 1,584,032
Net cash from investing activities 1,597,480 292 1,597,772
NET INCREASE IN CASH AND
CASH EQUIVALENTS 2,626,806 94,326 2,721,132
CASH AND CASH EQUIVALENTS, JANUARY 1 876,210 154,230 1,030,440
CASH AND CASH EQUIVALENTS, DECEMBER 31 3,503,016$ 248,556$ 3,751,572$
VILLAGE OF MORTON GROVE, ILLINOIS
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
For the Year Ended December 31, 2012
(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 1,173,567$ 112,186$ 1,285,753$
Adjustments to reconcile operating income to net
cash from operating activities
Depreciation 291,023 - 291,023
Changes in operating assets and liabilities
Receivables (32,675) (8,194) (40,869)
Prepaid expenses - (31,847) (31,847)
Refundable deposits 3,000 - 3,000
Accounts payable 156,382 (3,576) 152,806
Accrued salaries and wages 12,128 - 12,128
Other postemployment benefit obligation 41,276 - 41,276
Deferred revenues 35,186 14,190 49,376
NET CASH FROM OPERATING ACTIVITIES 1,679,887$ 82,759$ 1,762,646$
SCHEDULE OF NONCASH TRANSACTIONS
Capital contribution from developer 64,122$ -$ 64,122$
PROPRIETARY FUNDS
For the Year Ended December 31, 2012
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, 2012
Cash and cash equivalents 759,283$
Investments, at fair value
Equity mutual funds 25,596,863
Bond index fund 14,712,838
Annuity contracts 9,380,219
U.S. Treasury obligations 3,518,400
U.S. agency obligations 9,678,967
Municipal bonds 115,496
Receivables
Accrued interest 51,988
Due from primary government 1,389
Prepaid expenses 3,469
Total assets 63,818,912
LIABILITIES
Accounts payable 18,973
Total liabilities 18,973
NET POSITION HELD IN TRUST FOR
PENSION BENEFITS 63,799,939$
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, 2012
ADDITIONS
Contributions
Employer 3,959,232$
Employee 820,919
Total contributions 4,780,151
Investment income
Net appreciation in fair value
of investments 3,905,368
Interest 1,000,543
Total investment income 4,905,911
Less investment expense (118,644)
Net investment income 4,787,267
Total additions 9,567,418
DEDUCTIONS
Retirement benefits 4,716,529
Duty/nonduty disability benefits 743,041
Surviving spouse benefits 434,235
Refunds 380,084
Administrative expenses 81,329
Total deductions 6,355,218
NET INCREASE 3,212,200
NET POSITION HELD IN TRUST
FOR PENSION BENEFITS
January 1 60,587,739
December 31 63,799,939$
See accompanying notes to financial statements.
- 19 -
- 17 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS
December 31, 2012
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 and the Morton Grove
Public Library’s (the Library) 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.
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. Library employees are allowed to
participate in MERF that the Village sponsors. MERF is reported as a pension trust
fund.
- 20 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 18 -
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.
Discretely Presented Component Unit
Morton Grove Public Library (the Library)
The Library’s board consists of seven elected individuals, none of which are
members of the Village’s governing body. The Library’s budget is subject to the
acceptance of the Village’s governing body. In addition, the taxing authority and
issuance of debt is also subject to the acceptance of the Village’s governing body.
Additionally, the activities of the Library are open to all citizens and benefit the
citizens of the Village.
- 21 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 19 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
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.
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.
- 22 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 20 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
c. Government-Wide and Fund Financial Statements (Continued)
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.
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.
- 23 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 21 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
c. Government-Wide and Fund Financial Statements (Continued)
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.
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. Nonoperating
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 and income taxes which uses a
120-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.
- 24 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 22 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
d. Measurement Focus, Basis of Accounting and Financial Statement Presentation
(Continued)
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.
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 balance
sheet. Proprietary fund operating statements present increases (i.e., revenues) and
decreases (i.e., expenses) in net total assets.
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.
- 25 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 23 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
f. Investments
Investments with a maturity of less than one year when purchased and nonnegotiable
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.”
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 a fund balance reserve account 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.
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.
- 26 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 24 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
i. Capital Assets (Continued)
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:
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.
- 27 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 25 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
j. Compensated Absences (Continued)
In addition, the Village has recorded $467,744 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.
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 expenditures.
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.
- 28 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 26 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
m. Fund Balance/Net Position (Continued)
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.
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.
Invested in capital assets, net of related debt, 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 position
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 position 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.
- 29 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 27 -
2. LEGAL COMPLIANCE AND ACCOUNTABILITY
Deficit Fund Balances/Net Position of Individual Funds
The following funds had a deficit in fund balance/net position as of the date of this report:
Fund
Deficit
Balance
Major Governmental
Waukegan Road TIF $ 1,390,303
Debt Service 374,212
Nonmajor Governmental
Dempster/Waukegan TIF 112,974
Fire Alarm 12,706
Economic Development 66,679
Proprietary
Solid Waste 63,846
3. DEPOSITS AND INVESTMENTS
Permitted Deposits and Investments - The Village’s investment policy (including MERF)
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.
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 Fund’s 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.
- 30 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 28 -
3. DEPOSITS AND INVESTMENTS (Continued)
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, 2012, 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) $ 262,805 $ 262,805 $ - $ - $ -
FHLMC 1,590,252 1,590,252 - - -
FHLB 1,146,159 1,146,159 - - -
Negotiable CDs 1,245,183 1,245,183 - - -
TOTAL $ 4,244,399 $ 4,244,399 $ - $ - $ -
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.
- 31 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 29 -
3. DEPOSITS AND INVESTMENTS (Continued)
Village Investments (Continued)
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. The FHLMC and FHLB investments are rated AA+. 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, 2012, the
Village had 29.70% of its investments in Federal Home Loan Mortgage Corporation Notes,
21.41% in Federal Home Loan Bank Notes, 23.26% in Negotiable CDs and 4.91% in
IMET.
Police Pension Fund Deposits
Custodial credit risk for deposits with financial institutions is the risk that in the event of a
bank’s failure, the Police Pension Funds’ deposits may not be returned to them. The Police
Pension Funds’ investment policies require 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 Police Pension Fund in the Police Pension Fund’s name.
Police Pension Fund Investments
As of December 31, 2012, the Police Pension Fund had the following investments and
maturities.
Investment Maturities (in Years)
Less More
Fair Value than 1 1-5 6-10 than 10
Government bond index fund $ 14,712,838 $ 14,712,838 $ - $ - $ -
- 32 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 30 -
3. DEPOSITS AND INVESTMENTS (Continued)
Police Pension Fund Investments (Continued)
In accordance with its investment policy, the Police Pension 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 within a one-year period. The investment policy
does not limit the maximum maturity length of investments in the Police Pension Fund.
The Police Pension 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 government bond index fund is not rated by the commercial ratings
agencies. The average quality rating of securities held in the fund is AAA.
Custodial credit risk for investments is the risk that, in the event of the failure of the
counterparty to the investment, the Police Pension 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 Police Pension 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 Police Pension Fund’s
agent separate from where the investment was purchased or by the trust department of the
bank where purchased, in the Police Pension Fund’s name. Illinois Funds and the money
market mutual funds are not subject to custodial credit risk.
Concentration of credit risk - the Police Pension Fund’s investment policy states
investment parameters for each asset class. Percentage allocations are intended to serve as
guidelines:
Minimum Maximum
Equities 10% 45%
International Equities 0% 10%
Fixed Income & Cash 5% 90%
In addition, the Police Pension Fund’s investments of common, preferred or convertible
preferred stock, separate accounts managed by life insurance companies and mutual funds
shall not exceed 35% of the market value of the Police Pension Fund’s net present assets
and an additional 10% allowed to be invested in equities through a mutual fund or separate
account of a life insurance company.
- 33 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 31 -
3. DEPOSITS AND INVESTMENTS (Continued)
Firefighters’ Pension Fund Deposits
Custodial credit risk for deposits with financial institutions is the risk that in the event of a
bank’s failure, the Firefighters’ Pension Fund’s deposits may not be returned to them. The
Firefighters’ Pension Fund’s investment policies require 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 Firefighters’ Pension Fund in the Firefighters’ Pension
Fund’s name.
Firefighters’ Pension Fund Investments
As of December 31, 2012, the Firefighters’ Pension Fund had the following investments
and maturities.
Investment Maturities (in Years)
Less More
Fair Value than 1 1-5 6-10 than 10
Municipal Bonds $ 115,496 $ - $ - $ 115,496 $ -
U.S. Treasury obligations 3,518,400 151,945 1,668,752 1,697,703 -
FFCB 1,985,351 - - 1,461,395 523,956
FHLMC 1,207,395 - 907,362 300,033 -
FHLB 4,635,354 - 2,100,835 2,534,519 -
FNMA 1,850,867 744,170 325,538 348,855 432,304
TOTAL $ 13,312,863 $ 896,115 $ 5,002,487 $ 6,458,001 $ 956,260
In accordance with its investment policy, the Firefighters’ Pension 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 within a one-year period. The investment policy
does not limit the maximum maturity length of investments in the Firefighters’ Pension
Fund.
The Firefighters’ Pension 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 US Treasury Obligations are not rated by
Standard and Poors. The ratings for the FFCB, FHLB, and FNMA investments ranged
from AA+ to AAA whereas the FHLMC investments were rated AA+.
- 34 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 32 -
3. DEPOSITS AND INVESTMENTS (Continued)
Firefighters’ Pension Fund Investments (Continued)
Custodial credit risk for investments is the risk that, in the event of the failure of the
counterparty to the investment, the Firefighters’ Pension 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 Firefighters’ Pension 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
Firefighters’ Pension Fund’s agent separate from where the investment was purchased or
by the trust department of the bank where purchased, in the Firefighters’ Pension Fund’s
name. Illinois Funds and the money market mutual funds are not subject to custodial credit
risk.
Concentration of credit risk - the Firefighters’ Pension Fund’s investment policy states that
no more than 5% of the total portfolio may be invested in one individual security or in
cash. Also, with the exception of U.S. Treasury securities, no more than 40% of the total
fund’s investment portfolio may be invested in a single security type. At December 31,
2012, 13.56% of the Firefighters’ Pension Fund investments were invested in U.S.
Treasury obligations, 0.45% in Municipal Bonds, 7.65% in FFCB, 4.65% in FHLMC,
17.87% in FHLB and 7.14% in FNMA.
4. RECEIVABLES
a. Property Taxes
Property taxes for 2012 attach as an enforceable lien on January 1, 2012 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, 2012 and August 1, 2012 and are payable in two
installments, on or about March 1, 2012 and September 1, 2012. 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 2012 levy is intended to fund the 2013 fiscal year, the levy has been
recorded as a receivable and unavailable or unearned revenue.
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.
- 35 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 33 -
5. CAPITAL ASSETS
Capital asset activity for the year ended December 31, 2012 was as follows:
Primary Government
Beginning
Balances
January 1
Additions
Retirements
Ending
Balances
December 31
GOVERNMENTAL ACTIVITIES
Capital assets not being depreciated
Land (including right of ways) $ 42,995,803 $ - $ 74,389 $ 42,921,414
Construction in Progress 3,765,191 65,353 3,830,544 -
Total capital assets not being depreciated 46,760,994 65,353 3,904,933 42,921,414
Capital assets being depreciated
Buildings and improvements 18,175,872 - - 18,175,872
Vehicles and equipment 5,590,682 214,962 113,889 5,691,755
Infrastructure 26,928,748 3,830,544 - 30,759,292
Total capital assets being depreciated 50,695,302 4,045,506 113,889 54,626,919
Less accumulated depreciation for
Buildings and improvements 10,721,670 589,221 - 11,310,891
Vehicles and equipment 4,381,189 271,331 81,729 4,570,791
Infrastructure 23,132,691 539,879 - 23,672,570
Total accumulated depreciation 38,235,550 1,400,431 81,729 39,554,252
Total capital assets being depreciated, net 12,459,752 2,645,075 32,160 15,072,667
GOVERNMENTAL ACTIVITIES
CAPITAL ASSETS, NET
$ 59,220,746
$ 2,710,428
$ 3,937,093
$ 57,994,081
Depreciation expense was charged to functions/programs of the governmental activities as
follows:
GOVERNMENTAL ACTIVITIES
General government $ 442,307
Public safety 308,964
Streets, sidewalks and sewers 649,160
TOTAL DEPRECIATION EXPENSE - GOVERNMENTAL ACTIVITIES $ 1,400,431
- 36 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 34 -
5. CAPITAL ASSETS (Continued)
Primary Government (Continued)
Beginning
Balances
January 1
Additions
Retirements
Ending
Balances
December 31
BUSINESS-TYPE ACTIVITIES
Capital assets not being depreciated
Construction in progress $ 1,978,738 $ 103,033 $ - $ 2,081,771
Total capital assets not being depreciated 1,978,738 103,033 - 2,081,771
Capital assets being depreciated
Buildings and improvements 12,294,289 - - 12,294,289
Equipment 2,048,323 19,730 - 2,068,053
Total capital assets being depreciated 14,342,612 19,730 - 14,362,342
Less accumulated depreciation for
Buildings and improvements 6,985,597 196,661 - 7,182,258
Equipment 1,400,215 94,362 - 1,494,577
Total accumulated depreciation 8,385,812 291,023 - 8,676,835
Total capital assets being
depreciated, net
5,956,800
(271,293)
-
5,685,507
BUSINESS-TYPE ACTIVITIES CAPITAL
ASSETS, NET
$ 7,935,538
$ (168,260)
$ -
$ 7,767,278
6. 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.
- 37 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 35 -
6. 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, 2012. The Village has recorded a receivable for the excess surplus balance
of $630,657 in the General Fund as of December 31, 2012.
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, 2012 (most recent available) of $517,636. This amount was
declared as a divided 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.
7. 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.
- 38 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 36 -
7. 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 4.0%, due on June 1
and December 1 of each
year.
Debt
Service
$ 7,925,000
$ -
$ 270,000
$ 7,655,000
$ 490,000
$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
1,246,250
3,738,750
-
-
408,750
1,226,250
837,500
2,512,500
415,000
1,245,000
$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 3.0% to 4.125%, due
on June 1 and
December 1 of each year.
Waukegan
Road
TIF
4,190,000
-
400,000
3,790,000
450,000
$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 2.0%, due on June 15
and December 15 of each
year.
Debt
Service
Water
and
Sewer
666,400
523,600
-
-
218,400
171,600
448,000
352,000
224,000
176,000
- 39 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 37 -
7. 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
$ -
-
TOTAL $ 26,420,000 $ - $ 2,695,000 $ 23,725,000 $ 3,000,000
b. Revolving Loans Payable
The Village entered into an installment contract with the Illinois Environmental
Protection Agency (IEPA) to provide funds for the construction of flood control
projects. The contracts are for a 20-year period with equal semiannual installments.
Installment contracts currently outstanding are as follows:
Fund Debt
Retired By
Balances
January 1
Additions
Reductions
Balances
December 31
Due Within
One Year
IEPA revolving line of
credit for Parkview and
South Central sewer
rehabilitation projects
payable semiannually
over 20 years upon
presentation of invoice by
IEPA with interest at
3.58%.
Debt
Service
$ 325,372
$ -
$ 325,372
$ -
$ -
TOTAL $ 325,372 $ - $ 325,372 $ - $ -
c. 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.
- 40 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 38 -
7. LONG-TERM DEBT (Continued)
c. Installment Notes Payable (Continued)
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
$ 1,507,919
$ -
$ 209,965
$ 1,297,954
$ 218,833
TOTAL $ 1,507,919 $ - $ 209,965 $ 1,297,954 $ 218,833
d. 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, 2012, the Village made
total intergovernmental payments of $189,358 from general (non-TIF) revenues. The
tax revenue is determined on an annual basis and the estimated future liability is
shown below.
e. 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, 2012, the
Village made total intergovernmental payments of $106,934 from general (non-TIF)
revenues. The tax revenue is determined on an annual basis and the estimated future
liability is shown below.
- 41 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 39 -
7. LONG-TERM DEBT (Continued)
e. Intergovernmental Agreement with School District 70 (Continued)
Year
Ending
School
District 67
School
District 70
Total
2013 $ 204,623 $ 117,838 $ 322,461
2014 220,460 129,096 349,556
2015 236,891 140,720 377,611
2016 253,938 152,722 406,660
2017 271,625 165,114 436,739
2018 - 2022 289,976 1,026,011 1,315,987
2023 - 248,397 248,397
TOTAL $ 1,477,513 $ 1,979,898 $ 3,457,411
f. Debt Service Requirements to Maturity
Year General Obligation Bonds
Ending Governmental Activities Business-Type Activities
December 31, Principal Interest Total Principal Interest Total
2013 $ 2,409,000 $ 739,135 $ 3,148,135 $ 591,000 $ 210,568 $ 801,568
2014 2,476,500 673,168 3,149,668 598,500 197,710 796,210
2015 1,282,400 599,839 1,882,239 182,600 183,205 365,805
2016 1,338,000 552,846 1,890,846 187,000 177,362 364,362
2017 1,395,800 501,403 1,897,203 189,200 170,630 359,830
2018 2,103,600 445,308 2,548,908 191,400 163,062 354,462
2019 899,800 370,284 1,270,084 200,200 154,066 354,266
2020 943,800 332,508 1,276,308 211,200 144,657 355,857
2021 990,000 292,875 1,282,875 220,000 134,730 354,730
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 $ 18,958,300 $ 5,471,461 $ 24,429,761 $ 4,766,700 $ 2,145,150 $ 6,911,850
- 42 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 40 -
7. LONG-TERM DEBT (Continued)
f. Debt Service Requirements to Maturity (Continued)
Year Total Installment Notes Payable
Ending Governmental Activities
December 31, Principal Interest Total
2013 $ 218,833 $ 51,062 $ 269,895
2014 227,912 41,984 269,896
2015 237,366 32,529 269,895
2016 247,158 22,738 269,896
2017 257,466 12,429 269,895
2018 109,219 2,244 111,463
TOTAL $ 1,297,954 $ 162,986 $ 1,460,940
g. 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:
Primary Government
Balances
January 1
Additions
Reductions
Balances
December 31
Due Within
One Year
GOVERNMENTAL ACTIVITIES
General obligation bonds
payable
$ 21,072,950
$ -
$ 2,114,650
$ 18,958,300
$ 2,409,000
Unamortized premium on bonds 76,861 - 6,450 70,411 -
Unamortized discount on bonds (11,669) - (2,235) (9,434) -
Revolving loans payable 325,372 - 325,372 - -
Installment notes payable 1,507,919 - 209,965 1,297,954 218,833
Intergovernmental agreement
payable
3,753,704
-
296,293
3,457,411
322,461
Net pension obligation 14,520,492 911,139 - 15,431,631 -
Net other postemployment
benefit obligation
2,219,291
508,747
-
2,728,038
-
*Compensated absences payable 514,932 540,922 514,932 540,922 54,092
TOTAL GOVERNMENTAL
ACTIVITIES DEBT
$ 43,979,852
$ 1,960,808
$ 3,465,427
$ 42,475,233
$ 3,004,386
* 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.
- 43 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 41 -
7. LONG-TERM DEBT (Continued)
g. Changes in Long-Term Liabilities (Continued)
Primary Government (Continued)
Balances
January 1
Additions
Reductions
Balances
December 31
Due Within
One Year
BUSINESS-TYPE ACTIVITIES
General obligation bonds
payable
$ 5,347,050
$ -
$ 580,350
$ 4,766,700
$ 591,000
Unamortized premium on
bonds
19,642
-
8,378
11,264
-
*Net other postemployment
benefit obligation
172,067
41,276
-
213,343
-
TOTAL BUSINESS-TYPE DEBT $ 5,538,759 $ 41,276 $ 588,728 $ 4,991,307 $ 591,000
* Business-type activities’ net other postemployment benefit obligation are liquidated by
the Water and Sewer Fund, the fund in which the related salary has been charged.
h. 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.
- 44 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 42 -
7. LONG-TERM DEBT (Continued)
i. 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,
2012, $4,060,000 of the refunded bonds was outstanding.
j. 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. Amounts paid to CVS under the terms of
the agreement were $28,413 for fiscal year ended December 31, 2012.
Remaining amount potentially owed to CVS under the agreement is $29,221 as
of December 31, 2012.
2. Gary D. McGrath
On January 14, 2002, the Village entered into a redevelopment agreement for
the Waukegan Road TIF Village Redevelopment Area “B” with Gary D.
McGrath, a local auto dealership owner. The agreement calls for Mr. McGrath
to purchase properties of the north portion of Redevelopment Area “B” for
$1,799,412 and for the Village to remit to him a portion of the sales tax
receipts collected on sales made by the new auto dealership, McGrath Acura,
which is planned to be located on the purchased properties. The maximum
amount to be remitted by the Village is $500,000, provided that the Village
does not require site improvements costing in excess of that amount. No
amounts were due to Gary D. McGrath under the terms of the agreement for
the fiscal year ended December 31, 2012.
- 45 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 43 -
7. LONG-TERM DEBT (Continued)
j. Economic Development and Redevelopment Agreements (Continued)
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. Amounts paid to Walgreens under the
terms of the agreement were $35,516 for fiscal year ended December 31, 2012.
Remaining amount potentially owed to Walgreens under the agreement is
$18,836 as of December 31, 2012.
k. 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.
- 46 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 44 -
8. INTERFUND ASSETS/LIABILITIES
a. Due From/To Other Funds
Receivable Fund Payable Fund Amount
GOVERNMENTAL FUNDS
General Debt Service $ 694,699
General Fire Alarm 2,215
General Economic Development 248,725
General Water/Sewer 37,737
TOTAL $ 983,376
Significant amounts due from/to other funds at December 31, 2012 are as follows:
$694,699 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 2013.
$248,725 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 2013.
$37,737 due from the Water/Sewer Fund to the General Fund. This balance is
from a tower lease payment mistakenly posted to the General Fund. The
balance will be paid in the first quarter of 2012.
b. Due From/To Fiduciary Funds
Receivable Fund Payable Fund Amount
PENSION TRUST FUNDS
Municipal Employees Retirement General $ 1,389
TOTAL $ 1,389
Significant amounts due from/to fiduciary funds at December 31, 2012 are as
follows:
$1,389 due from General Fund to the Municipal Employees Retirement
Pension Trust Fund for contributions due at year end.
- 47 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 45 -
8. INTERFUND ASSETS/LIABILITIES (Continued)
c. Advances
As of December 31, 2012, individual fund advances between funds were as follows:
Receivable Fund Payable Fund Amount
General Waukegan Road TIF $ 1,468,930
General Dempster/Waukegan TIF 77,260
Lehigh/Ferris TIF Dempster/Waukegan TIF 35,714
TOTAL $ 1,581,904
Significant amounts of advances at December 31, 2012 are as follows:
$1,468,930 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.
9. 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.
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.
- 48 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 46 -
10. 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.
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.
- 49 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 47 -
10. JOINT VENTURES (Continued)
Solid Waste Agency of Northern Cook County (SWANCC) (Continued)
In accordance with the contract, the Village made payments totaling $452,500 to
SWANCC in 2012, which includes payment for debt contribution. The Village does not
have an equity interest in SWANCC at December 31, 2012.
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 $35,050 a month or $420,600 a year.
11. RELATED PARTIES
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.
- 50 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 48 -
12. POSTEMPLOYMENT BENEFITS
a. Plan Description
In addition to providing the pension benefits described, the Village provides
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 three retirement plans. The retirees pay the blended premium. 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, 2012, membership consisted of:
Retirees and beneficiaries currently receiving
benefits 41
Terminated employees entitled
to benefits but not yet receiving them -
Active employees 148
TOTAL 189
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.
- 51 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 49 -
12. 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, 2010 $ 1,072,812 $ 560,463 52.1% $ 1,794,719
December 31, 2011 1,118,579 521,940 46.7% 2,391,358
December 31, 2012 1,173,358 623,335 53.1% 2,941,381
The net OPEB obligation as of December 31, 2012 was calculated as follows:
Annual required contribution $ 1,151,127
Interest on net OPEB obligation 107,611
Adjustment to annual required contribution (85,380)
Annual OPEB cost 1,173,358
Contributions made 623,335
Increase in net OPEB obligation 550,023
Net OPEB obligation, beginning of year 2,391,358
NET OPEB OBLIGATION, END OF YEAR $ 2,941,381
Funded Status and Funding Progress: The projected funded status and funding
progress of the Plan as of December 31, 2012, was as follows:
Actuarial accrued liability (AAL) $ 14,949,354
Actuarial value of plan assets -
Unfunded actuarial accrued liability (UAAL) 14,949,354
Funded ratio (actuarial value of plan assets/AAL) 0.00%
Covered payroll (active plan members) $ 11,873,393
UAAL as a percentage of covered payroll 125.91%
- 52 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 50 -
12. 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, 2012, 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 2.43% with an ultimate healthcare inflation
rate of 4.5%. Both rates include a 4.0% 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, 2012 was 30 years.
- 53 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 51 -
13. EMPLOYEE RETIREMENT SYSTEMS
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), a single-employer
plan; the 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.
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.
IMRF 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 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.
- 54 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 52 -
13. EMPLOYEE RETIREMENT SYSTEMS (Continued)
a. Plan Descriptions (Continued)
Illinois Municipal Retirement Fund (IMRF) (Continued)
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, 2012 was 10.20% of
covered payroll.
For December 31, 2012, the Village’s annual pension cost of $282,054 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) 7.50% investment rate
of return (net of administrative expenses); (b) projected salary increases of 4.00% 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, 2010 was 30 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 2.50% of their final rate of
earnings, for each year of credited service up to 20 years, 2.00% of their final
earnings rate for the next ten years of credited service and 1.00% 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 7.50% 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 2012 was 0% of covered payroll.
- 55 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 53 -
13. EMPLOYEE RETIREMENT SYSTEMS (Continued)
a. Plan Descriptions (Continued)
Municipal Employee Retirement Fund (MERF)
All employees, including the Library 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) must be enrolled in MERF as participating
members. 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 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 2.0% of their annual salary to
MERF. The Village is required to contribute the remaining amounts necessary to
fund the MERF as specified by the Plan. The employer contribution for the year
ended December 31, 2012 was 25.25% of covered payroll.
At December 31, 2012, the MERF membership consisted of:
Retirees and beneficiaries currently receiving benefits 18
Terminated employees entitled to benefits but not
yet receiving them -
Active employees 30
Inactive employees 23
TOTAL 71
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 Plan as a
pension trust fund. At December 31, 2012, the Police Pension Plan membership
consisted of:
- 56 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 54 -
13. EMPLOYEE RETIREMENT SYSTEMS (Continued)
a. Plan Descriptions (Continued)
Police Pension Plan (Continued)
Retirees and beneficiaries currently receiving benefits 45
Terminated employees entitled to benefits but not
yet receiving them -
Inactive members 10
Current employees
Vested 27
Nonvested 17
TOTAL 99
The Police Pension Plan provides retirement benefits as well as death and disability
benefits. 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 2.50% of such salary for each
additional year of service over 20 years up to 30 years to a maximum of 75.00% 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 a reduced benefit. The monthly benefit of a
police officer who retired with 20 or more years of service after January 1, 1977 shall
be increased annually, following the first anniversary date of retirement and be paid
upon reaching the age of at least 55 years, by 3.00% of the original pension and
3.00% compounded annually thereafter.
- 57 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 55 -
13. EMPLOYEE RETIREMENT SYSTEMS (Continued)
a. Plan Descriptions (Continued)
Police Pension Plan (Continued)
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 3.00% compounded. The annual benefit shall be increased by 2.50% of
such salary for each additional year of service over 20 years up to 30 years to a
maximum of 75.00% 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. Noncompounding increases occur annually,
each January thereafter. The increase is the lesser of 3.00% or ½ of the change in the
Consumer Price Index for the proceeding calendar year.
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 ten
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 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, 2012, the
Village’s contribution was 49.12% of covered payroll.
Firefighters’ Pension Plan
Fire sworn personnel are covered by the Firefighters’ Pension Plan which is a defined
benefit single-employer pension plan. Although this is a single-employer pension
plan, the defined benefits as well as the employee and employer contributions levels
are mandated by Illinois Compiled Statutes (Chapter 40 - Article 5/4) and may be
amended only by the Illinois legislature. The Village accounts for the Plan as a
pension trust fund. At December 31, 2012, the Firefighters’ Pension Plan
membership consisted of:
- 58 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 56 -
13. EMPLOYEE RETIREMENT SYSTEMS (Continued)
a. Plan Descriptions (Continued)
Firefighters’ Pension Plan (Continued)
Retirees and beneficiaries currently receiving benefits 41
Terminated employees entitled to benefits but not
yet receiving them -
Inactive members 2
Current employees
Vested 29
Nonvested 11
TOTAL 83
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 2.50%
of such salary for each additional year of service over 20 years up to 30 years to a
maximum of 75.00% 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 of a covered employee who retired with 20 or more
years of service after January 1, 1977 shall be increased annually, following the first
anniversary date of retirement and be paid upon reaching the age of at least 55 years,
by 3.00% of the original pension and 3.00% 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 firefighter 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.
- 59 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 57 -
13. EMPLOYEE RETIREMENT SYSTEMS (Continued)
a. Plan Descriptions (Continued)
Firefighters’ Pension Plan (Continued)
Firefighters’ salary for pension purposes is capped at $106,800, plus the lesser of ½
of the annual change in the Consumer Price Index or 3.00% compounded. The
annual benefit shall be increased by 2.50% of such salary for each additional year of
service over 20 years up to 30 years to a maximum of 75.00% 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
firefighter shall be increased annually at age 60 on the January 1st after the firefighter
retires, or the first anniversary of the pension starting date, whichever is later.
Noncompounding increases occur annually, each January thereafter. The increase is
the lesser of 3.00% or ½ of the change in the Consumer Price Index for the
proceeding calendar year.
Effective July 1, 2004, covered employees are required to contribute 9.455% of their
base salary to the Firefighters’ Pension Plan. If an employee leaves covered
employment with less than ten years of service, accumulated employee contributions
may be refunded without accumulated interest. The Village is required to finance the
plan as actuarially determined by an enrolled actuary. Effective January 1, 2011, the
Village has until the year 2040 to fund 90% of the past services costs for the
Firefighters’ Pension Plan. For the year ended December 31, 2012, the Village’s
contribution was 55.86% of covered payroll.
b. 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.
There are no significant investments (other than U.S. Government guaranteed
obligations) in any one organization that represent 5.00% or more of plan net
position for either the Police or the Firefighters’ Pension Plans.
The costs of administering the Police and Firefighters’ Pension Plans are financed
through employer and employee contributions.
- 60 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 58 -
13. EMPLOYEE RETIREMENT SYSTEMS (Continued)
b. Summary of Significant Accounting Policies and Plan Asset Matters (Continued)
The benefits and refunds of the Police and Firefighters’ Pension Plans are recognized
when due and payable in accordance with the terms of the Police and Firefighters’
Pension Plans.
c. Annual Pension Cost
Employer contributions have been determined as follows:
Illinois
Municipal
Retirement
Sheriff’s Law
Enforcement
Personnel
Actuarial valuation date December 31,
2010
December 31,
2010
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 30 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
.40% to
10.00%
.40% to
10.00%
d) Postretirement benefit
increases
3.00% 3.00%
- 61 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 59 -
13. EMPLOYEE RETIREMENT SYSTEMS (Continued)
c. Annual Pension Cost (Continued)
Municipal
Employees’
Retirement
Police
Pension
Firefighters’
Pension
Actuarial valuation date January 1,
2012
December 31,
2011
December 31,
2011
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 21 Years,
Closed
30 Years,
Open
30 Years,
Open
Significant actuarial assumptions
a) Rate of return on 7.00% to 8.00% 7.25% 7.25%
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%
- 62 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 60 -
13. EMPLOYEE RETIREMENT SYSTEMS (Continued)
c. Annual Pension Cost (Continued)
The Village’s annual pension cost and net pension obligation (asset) for the current
year ended December 31, 2012 were as follows:
Municipal
Employees’
Retirement
Police
Pension
Firefighters’
Pension
Annual required contributions $ 661,804 $ 1,862,314 $ 2,054,683
Interest on net pension obligation 47,600 493,214 526,662
Adjustment to annual required contribution (42,277) (368,749) (407,334)
Annual pension cost 667,127 1,986,779 2,174,011
Contributions made 572,810 1,568,911 1,775,057
Change in net pension obligation 94,317 417,868 398,954
Net pension obligation, beginning of year 680,005 6,576,187 7,264,300
NET PENSION OBLIGATION,
END OF YEAR
$ 774,322
$ 6,994,055
$ 7,663,254
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 2010 $ 245,399 $ - $ 581,130 $ 1,894,878 $ 2,016,559
(APC) 2011 271,600 - 655,656 2,077,531 2,293,361
2012 282,054 - 667,127 1,986,779 2,174,011
Actual contribution 2010 $ 245,399 $ - $ 656,223 $ 1,488,481 $ 1,646,123
2011 271,600 - 490,743 1,845,746 2,047,228
2012 282,054 - 572,810 1,568,911 1,775,057
Percentage of APC 2010 100.00% - 112.92% 78.55% 81.63%
contributed 2011 100.00% - 74.85% 88.84% 89.27%
2012 100.00% - 85.86% 75.97% 81.65%
Net pension obligation 2010 $ - $ - $ 515,092 $ 6,344,402 $ 7,018,227
(asset) 2011 - - 680,005 6,576,187 7,264,300
2012 - - 774,322 6,994,055 7,663,254
- 63 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 61 -
13. EMPLOYEE RETIREMENT SYSTEMS (Continued)
e. Funded Status and Funding Progress
The funded status and funding progress of the plans as of December 31, 2012 were as
follows:
Illinois
Municipal
Retirement
Sheriff’s Law
Enforcement
Personnel
Municipal
Employees’
Retirement
Police
Pension
Firefighters’
Pension
Actuarial accrued liability (AAL) $ 3,164,935 $ - $ 13,582,078 $ 53,120,258 $ 50,222,856
Actuarial value of plan assets 2,414,956 (14,488) 7,715,639 28,644,151 25,997,209
Unfunded actuarial accrued
liability (UAAL)
749,979
14,488
5,866,439
24,476,107
24,225,647
Funded ratio (actuarial value of
plan assets/AAL)
76.30%
0.00%
56.81%
53.92%
51.76%
Covered payroll (active plan
members)
$ 2,765,233
$ -
$ 2,268,195
$ 3,721,308
$ 3,564,271
UAAL as a percentage of covered
payroll
27.12%
0.00%
258.64.%
657.73%
679.68%
14. RESTATEMENT
Net position of the governmental activities and Water and Sewer Fund/business-type
activities has been decreased as of January 1, 2012 by $192,958 and $55,463, respectively
to write off prior year unamortized bond issuance costs related to the implementation of
GASB Statement No. 65.
15. COMPONENT UNIT - MORTON GROVE PUBLIC LIBRARY
The financial statements of the Morton Grove Public Library (the Library) have been
prepared in conformity with accounting principles generally accepted in the United States
of America, as applied to government units (hereinafter referred to as generally accepted
accounting principles (GAAP)). 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 Library’s accounting policies are
described below.
a. Fund Accounting
The Library uses funds to report on its financial position and the changes in its
financial position. 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. The
Library’s general fund is classified as a governmental fund.
- 64 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 62 -
15. COMPONENT UNIT - MORTON GROVE PUBLIC LIBRARY (Continued)
b. Government-Wide Financial Statements
Governmental funds are used to account for all or most of a government’s general
activities, including the collection and disbursement of earmarked monies (special
revenue funds), the acquisition or construction of capital assets (capital projects
funds) and the servicing of general long-term debt (debt service funds). The general
fund is the general operating fund of the Library and accounts for all of the Library’s
operating activities.
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
Library. The effect of material interfund activity has been eliminated from these
statements. 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 not properly included
among program revenues are reported instead as general revenues.
c. 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. Revenues are recorded when
earned and expenses are recorded when a liability is incurred. Property taxes are
recognized as revenues in the year for which they are levied (i.e., intended to
finance). Grants and similar items are recognized as revenue as soon as all eligibility
requirements imposed by the provider have been met.
The Library 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 Library 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 Library has a legal claim
to the resources, the unearned revenue or unavailable revenue is removed from the
financial statements and revenue is recognized.
- 65 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 63 -
15. COMPONENT UNIT - MORTON GROVE PUBLIC LIBRARY (Continued)
d. Investments
Investments with a maturity greater than one year when purchased are stated at fair
value at December 31, 2012. Securities traded on national exchanges are at the last
reported sale price. Investments with a maturity of one year or less when purchased
are reported at cost or amortized cost.
e. 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.
f. Capital Assets
Capital assets, which include property, plant, equipment and infrastructure, are
reported in the applicable governmental activities columns in the government-wide
financial statements. Capital assets are defined by the Library as assets with an
initial, individual cost of more than $5,000 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.
Major outlays for capital assets and improvements are capitalized as projects are
constructed. Property, plant and equipment is depreciated using the straight-line
method over the following estimated useful lives:
Assets Years
Buildings 5-50
Machinery and equipment 5-20
Artwork 10
g. Vacation Benefits
Vested or accumulated vacation and sick leave of governmental activities at the
government-wide level is recorded as an expense and liability as the benefits accrue
to employees.
- 66 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 64 -
15. COMPONENT UNIT - MORTON GROVE PUBLIC LIBRARY (Continued)
h. Long-Term Obligations
In the government-wide financial statements long-term debt and other long-term
obligations are reported as liabilities in the governmental activities column. Bond
premiums and discounts are deferred and amortized over the life of the bonds.
Bonds payable are reported net of the applicable bond premium or discount.
i. Fund Balances/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 Library. Committed fund balance is constrained by formal
actions of the Library’s Board of Trustees, which is considered the Library’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
Library’s intent to use them for a specific purpose. The authority to assign fund
balance has been delegated to the Library Director by the Fund Balance and Reserve
Policy. Any residual fund balance in the General Fund and any deficit fund balance
of any other governmental fund are reported as unassigned.
The Library 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
Library considers committed funds to be expended first followed by assigned funds
and then unassigned funds.
In the government-wide financial statements, restricted net positions are legally
restricted by outside parties for a specific purpose. None of the Library’s restricted
net positions resulted from enabling legislation adopted by the Library. Net
investment in capital assets is the book value of capital assets less any long-term debt
outstanding that was issued to construct or acquire the capital assets.
- 67 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 65 -
15. COMPONENT UNIT - MORTON GROVE PUBLIC LIBRARY (Continued)
j. 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 position
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 position that applies to a future period(s) and so will
not be recognized as an inflow of resources (revenue) until that time.
k. Deposits and Investments
Permitted Deposits and Investments - The Library’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 and Illinois
Funds.
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 Fund’s
share price, the price for which the investment could be sold.
It is the investment credit risk policy of the Library 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 Library 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.
1. Deposits
Custodial credit risk for deposits with financial institutions is the risk that in
the event of a bank’s failure, the Library’s deposits may not be returned to it.
The Library’s investment policy requires pledging of collateral with a fair
value of 110% of all bank balances in excess of federal depository insurance.
- 68 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 66 -
15. COMPONENT UNIT - MORTON GROVE PUBLIC LIBRARY (Continued)
k. Deposits and Investments (Continued)
2. Investments
In accordance with its investment policy, the Library limits its exposure to
interest rate risk by structuring the portfolio so that securities mature
concurrent with cash needs. The investment policy limits the maximum
maturity length of investments to five years from date of purchase, unless
specific authority is given to exceed. Investments in reserve funds other funds
may be purchased with maturities to match future projects or liability
requirements. In addition, the policy requires the Library to structure the
investment 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.
The Library limits its exposure to credit risk, the risk that the issuer of a debt
security will not pay its par value upon maturity, by investing in Illinois Funds
or 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. Illinois Funds are rated AAA by
Standard and Poor’s.
Custodial credit risk for investments is the risk that, in the event of the failure
of the counterparty to the investment, the Library will not be able to recover the
value of its investments that are in possession of an outside party. To limit its
exposure, the Library’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 Library’s agent separate from where the investment was purchased
or by the trust department of the bank where purchased, in the Library’s name.
Illinois Funds are not subject to custodial credit risk.
At December 31, 2012, the Library had greater than 5% of its overall portfolio
invested in Illinois Funds (100%) The investment policy does not include any
limitations on individual investment types.
l. Property Taxes
Property taxes for 2012 attach as an enforceable lien on January 1, 2012, on property
values assessed as of the same date. Taxes are levied by December of the same fiscal
year (by passage of a tax levy ordinance). Taxes levied in one year become due and
payable in two installments, on or about March 1 or June 1 and September 1 of the
following year.
- 69 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 67 -
15. COMPONENT UNIT - MORTON GROVE PUBLIC LIBRARY (Continued)
l. Property Taxes (Continued)
Property taxes collected which are used to finance the current year’s operations are
recognized as revenue. Property taxes collected which are used to finance the
subsequent year’s operations, and net taxes receivable are reported as deferred
revenue.
Based upon collection histories, the Library has provided an allowance for
uncollectible property taxes equivalent to 1% of the current year’s levy. All
uncollected taxes related to prior years’ levies have been written off.
m. Capital Assets
The following is a summary of capital asset activity during the fiscal year:
Beginning
Balances
January 1
Additions
Retirements
Ending
Balances
December 31
GOVERNMENTAL ACTIVITIES
Capital assets not being depreciated
Land $ 79,000 $ - $ - $ 79,000
Total capital assets not being
depreciated
79,000
-
-
79,000
Capital assets being depreciated
Buildings and improvements 1,623,187 - - 1,623,187
Equipment and vehicles 108,208 4,236 14,500 97,944
Total capital assets being depreciated 1,731,395 4,236 14,500 1,721,131
Less accumulated depreciation for
Buildings and improvements 1,095,303 21,362 - 1,116,665
Equipment and vehicles 78,095 14,405 14,500 78,000
Total accumulated depreciation 1,173,398 35,767 14,500 1,194,665
Total capital assets being depreciated, net 557,997 (31,531) - 526,466
GOVERNMENTAL ACTIVITIES
CAPITAL ASSETS, NET $ 636,997 $ (31,531) $ - $ 605,466
- 70 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 68 -
15. COMPONENT UNIT - MORTON GROVE PUBLIC LIBRARY (Continued)
m. Capital Assets (Continued)
Depreciation expense was charged to functions/programs of the governmental
activities as follows:
GOVERNMENTAL ACTIVITIES
Culture and recreation $ 35,767
n. Long-Term Financing from Primary Government
1. Changes in Long-Term Debt
During the year ended December 31, 2012, the following changes occurred in
long-term liabilities reported in the governmental activities:
Balances
January 1
Additions
Reductions
Balances
December 31
Due Within
One Year
GOVERNMENTAL ACTIVITIES
Compensated absences payable $ 36,840 $ 15,565 $ - $ 52,405 $ 7,861
TOTAL GOVERNMENTAL
ACTIVITIES
$ 36,840
$ 15,565
$ -
$ 52,405
$ 7,861
o. Employee Retirement System
1. Plan Description
Municipal Employee Retirement Fund (MERF)
All employees, including the Library 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) must be enrolled in MERF as
participating members. 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 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 2.0% of their annual salary to MERF. The Village is
required to contribute the remaining amounts necessary to fund the MERF as
specified by the Plan. The employer contribution for the year ended
December 31, 2012 was 21.67% of covered payroll.
- 71 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 69 -
15. COMPONENT UNIT - MORTON GROVE PUBLIC LIBRARY (Continued)
o. Employee Retirement System (Continued)
1. Plan Description (Continued)
Municipal Employee Retirement Fund (MERF) (Continued)
At December 31, 2012, the MERF membership consisted of:
Retirees and beneficiaries currently receiving benefits 10
Terminated employees entitled to benefits but not
yet receiving them -
Active employees 6
Inactive employees 6
TOTAL 22
2. 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.
3. Annual Pension Cost
Employer contributions have been determined as follows:
Municipal
Employees’
Retirement
Actuarial valuation date January 1, 2012
Actuarial cost method Projected
Unit Credit
Asset valuation method Market
Amortization method Level Percentage of
Payroll
Amortization period 20 Years,
Closed
- 72 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 70 -
15. COMPONENT UNIT - MORTON GROVE PUBLIC LIBRARY (Continued)
o. Employee Retirement System (Continued)
3. Annual Pension Cost (Continued)
Municipal
Employees’
Retirement
Significant actuarial assumptions
a) Rate of return on 7.00% to 8.00%
present and future assets Pre/Postretirement
Compounded
Annually
b) Projected salary increase - 4.50%
attributable to inflation Compounded
Annually
c) Postretirement benefit
increases
None
4. Net Pension (Asset)
The Library’s annual pension cost and net pension obligation (asset) for the
year ended December 31, 2012 were as follows:
Municipal
Employees’
Retirement
Annual required contributions $ 79,654
Interest on net pension obligation (4,907)
Adjustment to annual required contribution 4,358
Annual pension cost 79,105
Contributions made 80,000
Increase (decrease) in net pension obligation (asset) (895)
Net pension obligation (asset), beginning of year (70,098)
NET PENSION OBLIGATION (ASSET), END OF YEAR $ (70,993)
- 73 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 71 -
15. COMPONENT UNIT - MORTON GROVE PUBLIC LIBRARY (Continued)
o. Employee Retirement System (Continued)
5. Trend Information
Trend information gives an indication of the progress made in accumulating
sufficient assets to pay benefits when due.
Fiscal
Year
Municipal
Employees’
Retirement
Annual pension cost 2010 $ 87,772
(APC) 2011 71,467
2012 79,105
Actual contribution 2010 $ 88,593
2011 69,600
2012 80,000
Percentage of APC 2010 100.93%
contributed 2011 97.39%
2012 101.13%
Net pension obligation 2010 $ (71,965)
(asset) 2011 (70,098)
2012 (70,993)
6. Funded Status and Funding Progress
The funded status and funding progress of the plans as of December 31, 2012
were as follows:
Municipal
Employees’
Retirement
Actuarial accrued liability (AAL) $ 2,592,272
Actuarial value of plan assets 1,662,886
Unfunded actuarial accrued liability (UAAL) 929,386
Funded ratio (actuarial value of plan assets/AAL) 64.15%
Covered payroll (active plan members) $ 369,209
UAAL as a percentage of covered payroll 251.72%
- 74 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO FINANCIAL STATEMENTS (Continued)
- 72 -
15. COMPONENT UNIT - MORTON GROVE PUBLIC LIBRARY (Continued)
p. Restatement
Fund balance/net position has been increased as of January 1, 2012 by $42,346 to
record payroll expenditures in the proper period.
- 75 -
REQUIRED SUPPLEMENTARY INFORMATION
Original
and Final 2011
Budget Actual Actual
REVENUES
Sales taxes 5,050,000$ 5,013,931$ 4,725,819$
Property taxes 8,556,532 8,608,978 8,453,034
Personal property replacement tax 317,164 318,455 317,590
State income taxes 1,756,607 2,044,675 1,797,158
Telecommunications taxes 1,125,000 960,057 983,367
Utility taxes 1,176,000 1,119,227 1,154,124
Other taxes 1,408,960 1,604,098 1,352,809
Licenses and permits 1,533,500 1,472,977 1,587,662
Intergovernmental 155,500 353,191 227,614
Charges for services 862,950 805,325 759,383
Fines 712,500 609,450 531,010
Investment income 10,000 4,847 2,833
Cable TV franchise fees 260,000 322,937 259,862
Miscellaneous 138,600 206,598 297,245
Total revenues 23,063,313 23,444,746 22,449,510
EXPENDITURES
Current
General government 3,071,880 2,960,966 2,299,975
Public safety 15,683,615 16,559,777 16,667,576
Streets and sidewalks 2,292,560 2,261,284 2,007,469
Sanitation - - -
Vehicle maintenance 721,900 816,073 738,039
Health and human services 301,023 263,187 255,880
Community development 99,650 105,595 125,036
Buildings and inspection services 803,970 698,263 555,482
Total expenditures 22,974,598 23,665,145 22,649,457
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES 88,715 (220,399) (199,947)
OTHER FINANCING SOURCES (USES)
Proceeds from sale of capital assets 10,000 77,800 29,578
Transfers 40,000 - -
Debt service fund (300,000) (300,000) -
Total other financing sources (uses)(250,000) (222,200) 29,578
NET CHANGE IN FUND BALANCE (161,285)$ (442,599) (170,369)
FUND BALANCE, JANUARY 1 7,310,398 7,480,767
FUND BALANCE, DECEMBER 31 6,867,799$ 7,310,398$
2012
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, 2012
(with prior year actual for 2011)
(See independent auditor's report.)
- 76 -
Original
and Final 2011
Budget Actual Actual
REVENUES
Property taxes 2,600,000$ 2,282,139$ 2,517,558$
Investment income 5,000 1,627 1,900
Miscellaneous - 29,377 -
Total revenues 2,605,000 2,313,143 2,519,458
EXPENDITURES
Current
Community development
Personal services 47,400 - -
Commodities 1,425 - 375
Contractual services 75,800 35,846 68,210
Debt service
Principal retirement 270,000 270,000 3,130,000
Interest and fiscal charges 317,000 317,428 427,860
Capital outlay 3,300,000 65,352 622,362
Total expenditures 4,011,625 688,626 4,248,807
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (1,406,625) 1,624,517 (1,729,349)
OTHER FINANCING SOURCES (USES)
Proceeds from sale of capital assets 2,000,000 - -
Total other financing sources (uses)2,000,000 - -
NET CHANGE IN FUND BALANCE 593,375$ 1,624,517 (1,729,349)
FUND BALANCE, JANUARY 1 10,771,232 12,500,581
FUND BALANCE, DECEMBER 31 12,395,749$ 10,771,232$
2012
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, 2012
(with prior year actual for 2011)
(See independent auditor's report.)
- 77 -
Original
and Final 2011
Budget Actual Actual
REVENUES
Property taxes 815,000$ 581,843$ 735,100$
Investment income 750 180 185
Total revenues 815,750 582,023 735,285
EXPENDITURES
Current
Community development
Professional services 25,000 428 1,948
Commodities 900,000 - -
Debt service
Principal 609,966 609,965 576,754
Interest and fiscal charges 202,519 202,518 222,354
Capital outlay 350,000 - 14,457
Total expenditures 2,087,485 812,911 815,513
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (1,271,735) (230,888) (80,228)
OTHER FINANCING SOURCES (USES)
Transfer (out)(40,000) - -
Total other financing sources (uses)(40,000) - -
NET CHANGE IN FUND BALANCE (1,311,735)$ (230,888) (80,228)
FUND BALANCE (DEFICIT), JANUARY 1 (1,159,415) (1,079,187)
FUND BALANCE (DEFICIT), DECEMBER 31 (1,390,303)$ (1,159,415)$
2012
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, 2012
(with prior year actual for 2011)
(See independent auditor's report.)
- 78 -
(2)(4)UAAL
Actuarial Unfunded as a
Actuarial (1)Accrued (3)AAL Percentage
Valuation Actuarial Liability Funded (UAAL)(5)of Covered
Date Value of (AAL)Ratio (OAAL)Covered Payroll
December 31,Assets Entry-Age (1) / (2) (2) - (1)Payroll (4) / (5)
2007 686,404$ 1,089,570$ 63.00%403,166$ 2,152,563$ 18.73%
2008 1,024,049 1,210,009 84.63%185,960 2,341,444 7.94%
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%
December 31, 2012
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF FUNDING PROGRESS
ILLINOIS MUNICIPAL RETIREMENT FUND
(See independent auditor's report.)
- 79 -
(6)
Underfunded
(Overfunded)
Actuarial
(4)Accrued
(2)Unfunded Liability
(1)Actuarial (Overfunded)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)
2007 43,027$ 19,143$ 224.77%(23,884)$ 118,013$ (20.24%)
2008 69,127 51,219 134.96%(17,908) 121,625 (14.72%)
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%
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF FUNDING PROGRESS
SHERRIFF'S LAW ENFORCEMENT PERSONNEL PLAN
December 31, 2012
(See independent auditor's report.)
- 80 -
(2)(4)UAAL
Actuarial Unfunded as a
Actuarial (1)Accrued (3)AAL Percentage
Valuation Actuarial Liability Funded (UAAL)(5)of Covered
Date Value of (AAL)Ratio (OAAL)Covered Payroll
December 31,Assets Entry-Age (1) / (2) (2) - (1)Payroll (4) / (5)
2007 8,227,160$ 12,950,501$ 63.53%4,723,341$ 3,296,093$ 143.30%
2008 7,189,731 11,644,312 61.74%4,454,581 2,766,617 161.01%
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%
December 31, 2012
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF FUNDING PROGRESS
MUNICIPAL EMPLOYEES' RETIREMENT FUND
(See independent auditor's report.)
- 81 -
(2)(4)UAAL
Actuarial Unfunded as a
Actuarial (1)Accrued (3)AAL Percentage
Valuation Actuarial Liability Funded (UAAL)(5)of Covered
Date Value of (AAL)Ratio (OAAL)Covered Payroll
December 31,Assets Entry-Age (1) / (2) (2) - (1)Payroll (4) / (5)
2007 25,244,202$ 39,185,747$ 64.42%13,941,545$ 3,411,419$ 408.67%
2008 24,888,311 42,602,902 58.42%17,714,591 3,420,380 517.91%
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%
December 31, 2012
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF FUNDING PROGRESS
POLICE PENSION FUND
(See independent auditor's report.)
- 82 -
(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 (UAAL)Covered Payroll
December 31,Assets Entry-Age (1) / (2) (2) - (1)Payroll (4) / (5)
2007 22,065,783$ 37,994,154$ 58.08%15,928,371$ 3,135,530$ 508.00%
2008 22,131,755 40,983,075 54.00%18,851,320 3,284,077 574.02%
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%
December 31, 2012
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF FUNDING PROGRESS
FIREFIGHTERS' PENSION FUND
(See independent auditor's report.)
- 83 -
(6)
Underfunded
(Overfunded)
Actuarial
(4)Accrued
(2)Unfunded Liability
(1)Actuarial (Overfunded)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)
2006 -$ 10,483,403$ 0.00%10,483,403$ 10,113,914$ 103.65%
2007 - 11,154,462 0.00%11,154,462 10,518,471 106.05%
2008 - 13,042,259 0.00%13,042,259 11,036,693 118.17%
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%
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF FUNDING PROGRESS
OTHER POSTEMPLOYMENT BENEFIT PLAN
December 31, 2012
(See independent auditor's report.)
- 84 -
Annual
Required
Calendar Employer Contribution Percentage
Year Contributions (ARC)Contributed
2007 198,251$ 198,251$ 100.00%
2008 215,881 215,881 100.00%
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%
December 31, 2012
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EMPLOYER CONTRIBUTIONS
ILLINOIS MUNICIPAL RETIREMENT FUND
(See independent auditor's report.)
- 85 -
Annual
Required
Calendar Employer Contribution Percentage
Year Contributions (ARC)Contributed
2007 14,940$ 14,940$ 100.00%
2008 15,033 15,033 100.00%
2009 8,736 8,736 100.00%
2010 - - N/A
2011 - - N/A
2012 - - N/A
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EMPLOYER CONTRIBUTIONS
SHERRIFF'S LAW ENFORCEMENT PERSONNEL PLAN
December 31, 2012
(See independent auditor's report.)
- 86 -
Annual
Required
Calendar Employer Contribution Percentage
Year Contributions (ARC)Contributed
2007 324,483$ 474,576$ 68.37%
2008 541,636 591,185 91.62%
2009 298,658 461,300 64.74%
2010 656,223 575,138 114.10%
2011 490,743 650,624 75.43%
2012 572,810 661,804 86.55%
December 31, 2012
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EMPLOYER CONTRIBUTIONS
MUNICIPAL EMPLOYEES' RETIREMENT FUND
(See independent auditor's report.)
- 87 -
Annual
Required
Calendar Employer Contribution Percentage
Year Contributions (ARC)Contributed
2007 1,030,738$ 1,195,986$ 86.18%
2008 1,344,344 1,411,984 95.21%
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%
December 31, 2012
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EMPLOYER CONTRIBUTIONS
POLICE PENSION FUND
(See independent auditor's report.)
- 88 -
Annual
Required
Calendar Employer Contribution Percentage
Year Contributions (ARC)Contributed
2007 1,262,030$ 1,498,121$ 84.24%
2008 1,569,399 1,611,299 97.40%
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%
December 31, 2012
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EMPLOYER CONTRIBUTIONS
FIREFIGHTERS' PENSION FUND
(See independent auditor's report.)
- 89 -
Annual
Required
Calendar Employer Contribution Percentage
Year Contributions (ARC)Contributed
2007 363,335$ 932,595$ 38.96%
2008 292,603 978,885 29.89%
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%
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EMPLOYER CONTRIBUTIONS
OTHER POSTEMPLOYMENT BENEFIT PLAN
December 31, 2012
(See independent auditor's report.)
- 90 -
- 1 -
VILLAGE OF MORTON GROVE, ILLINOIS
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2012
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 (excluding Seizure Fund and Dempster/Waukegan TIF Fund), 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 may 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. There were no budget
amendments made during the year.
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 $ 690,547
Fire Alarm 161,004
Commuter Parking Facility 4,649
Economic Development 135,051
- 91 -
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. When there is a bond issue used to finance a specific capital project,
the proceeds accounting for the expenditures of that project will be separately accounted for in
this section. 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.
Original
and Final 2011
Budget Actual Actual
GENERAL GOVERNMENT
Legislative
Personal services 65,300$ 56,302$ 56,456$
Contractual services 36,400 24,904 26,483
Commodities 2,500 2,544 1,471
Total legislative 104,200 83,750 84,410
Administrative
Personal services 445,300 534,915 457,831
Contractual services 66,240 54,283 20,735
Commodities 3,000 954 262
Total administrative 514,540 590,152 478,828
Finance
Personal services 1,173,900 1,120,510 602,423
Contractual services 627,176 657,594 547,152
Commodities 15,000 9,284 9,375
Less administrative fees
Water and Sewer Fund (120,000) (120,000) (120,000)
Total finance 1,696,076 1,667,388 1,038,950
Management information services
Professional services 139,900 140,423 136,785
Contractual services 256,714 222,963 228,522
Capital outlay 38,450 37,158 62,579
Total management information services 435,064 400,544 427,886
Legal
Contractual services 172,000 112,813 192,581
Other expenditures
Other 150,000 106,319 77,320
Total other expenditures 150,000 106,319 77,320
Total general government 3,071,880 2,960,966 2,299,975
PUBLIC SAFETY
Police
Personal services 7,247,300 7,562,826 7,652,656
Contractual services 1,095,115 1,311,153 1,131,969
Commodities 116,814 73,520 62,842
Capital outlay 190,450 185,326 134,727
Total police 8,649,679 9,132,825 8,982,194
2012
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EXPENDITURES - BUDGET AND ACTUAL
GENERAL FUND
For the Year Ended December 31, 2012
(with prior year actual for 2011)
(This schedule is continued on the following pages.)
- 92 -
Original
and Final 2011
Budget Actual Actual
PUBLIC SAFETY (Continued)
Fire
Personal services 6,525,000$ 6,934,809$ 7,285,561$
Contractual services 395,535 393,748 284,669
Commodities 99,259 88,524 85,183
Capital outlay - - 22,565
Total fire 7,019,794 7,417,081 7,677,978
Civil preparedness
Personal services 1,292 1,292 1,292
Contractual services 7,100 3,967 2,004
Commodities 3,250 2,131 1,706
Capital outlay 2,500 2,481 2,402
Total civil preparedness 14,142 9,871 7,404
Total public safety 15,683,615 16,559,777 16,667,576
STREETS AND SIDEWALKS
Streets and sidewalks
Personal services 1,452,300 1,578,367 1,562,112
Contractual services 432,100 401,312 231,209
Commodities 119,075 117,372 105,154
Capital outlay 223,335 147,321 70,670
Less administrative fees
Motor Fuel Tax Fund (180,000) (180,000) (180,000)
Commuter Parking Facility Fund (105,000) (105,000) (105,000)
Total streets and sidewalks 1,941,810 1,959,372 1,684,145
Engineering
Personal services 329,600 293,835 313,632
Contractual services 18,200 6,322 8,034
Commodities 2,950 1,755 1,658
Total engineering 350,750 301,912 323,324
Total streets and sidewalks 2,292,560 2,261,284 2,007,469
VEHICLE MAINTENANCE
Personal services 263,800 391,342 379,076
Contractual services 101,900 108,257 62,717
Commodities 356,200 316,474 296,246
Total vehicle maintenance 721,900 816,073 738,039
2012
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EXPENDITURES - BUDGET AND ACTUAL (Continued)
GENERAL FUND
For the Year Ended December 31, 2012
(with prior year actual for 2011)
(This schedule is continued on the following page.)
- 93 -
Original
and Final 2011
Budget Actual Actual
2012
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF EXPENDITURES - BUDGET AND ACTUAL (Continued)
GENERAL FUND
For the Year Ended December 31, 2012
(with prior year actual for 2011)
HEALTH AND HUMAN SERVICES
Family and Senior Services
Personal services 201,900$ 186,386$ 173,538$
Contractual services 89,223 66,764 74,692
Commodities 9,900 10,037 7,650
Total health and human services 301,023 263,187 255,880
COMMUNITY DEVELOPMENT
Personal services 88,400 99,900 117,600
Contractual services 10,500 4,225 7,093
Commodities 750 1,470 343
Total community development 99,650 105,595 125,036
BUILDING AND INSPECTION SERVICES
Building and Inspectional Services
Personal services 180,400 177,302 308,789
Contractual services 126,670 101,689 96,316
Commodities 1,000 1,024 749
Total building and inspectional services 308,070 280,015 405,854
Municipal Buildings
Personal services 11,100 10,632 10,116
Contractual services 145,800 295,857 135,723
Commodities 5,500 5,466 3,789
Capital outlay 333,500 106,293 -
Total municipal buildings 495,900 418,248 149,628
Total building and inspection services 803,970 698,263 555,482
TOTAL EXPENDITURES 22,974,598$ 23,665,145$ 22,649,457$
(See independent auditor's report.)
- 94 -
Original
and Final 2011
Budget Actual Actual
REVENUES
Property taxes 1,069,131$ 1,097,273$ 969,635$
Sales taxes 590,000 590,000 440,000
Intergovernmental 81,610 81,610 81,610
Investment income 2,500 1,110 956
Total revenues 1,743,241 1,769,993 1,492,201
EXPENDITURES
Debt service
Principal retirement 1,770,022 1,770,022 1,683,395
Interest and fiscal charges 338,650 339,543 376,424
Bond issuance costs 40,000 - -
Total expenditures 2,148,672 2,109,565 2,059,819
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (405,431) (339,572) (567,618)
OTHER FINANCING SOURCES (USES)
Transfers in 300,000 300,000 -
Total other financing sources (uses)300,000 300,000 -
NET CHANGE IN FUND BALANCE (105,431)$ (39,572) (567,618)
FUND BALANCE (DEFICIT), JANUARY 1 (334,640) 232,978
FUND BALANCE (DEFICIT), DECEMBER 31 (374,212)$ (334,640)$
2012
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, 2012
(with prior year actual for 2011)
(See independent auditor's report.)
- 95 -
Original
and Final 2011
Budget Actual Actual
REVENUES
Property taxes 50,000$ 50,690$ 121,409$
Personal property replacement tax 25,500 31,005 30,948
Sales taxes 25,000 25,000 125,000
Intergovernmental 810,000 6,581 278,738
Investment income 1,000 17,286 65,390
Miscellaneous revenue - 4,403 247,400
Total revenues 911,500 134,965 868,885
EXPENDITURES
Contractual services - - 10
Local street resurfacing
Construction 4,263,000 2,036,516 1,464,717
Engineering - 41,005 920,050
Total expenditures 4,263,000 2,077,521 2,384,777
NET CHANGE IN FUND BALANCE (3,351,500)$ (1,942,556) (1,515,892)
FUND BALANCE, JANUARY 1 4,967,626 6,483,518
FUND BALANCE, DECEMBER 31 3,025,070$ 4,967,626$
2012
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, 2012
(with prior year actual for 2011)
(See independent auditor's report.)
- 96 -
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.
Six 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 408,990$ 180,665$ 112,235$
Investments - - -
Sales tax receivable - - -
Accounts, miscellaneous and
allotments receivable 48,169 - 56,334
TOTAL ASSETS 457,159$ 180,665$ 168,569$
LIABILITIES
Accounts payable and retainage payable 8,558$ 225$ 3,055$
Due to other funds - - -
Advances from other funds - - -
Total liabilities 8,558 225 3,055
FUND BALANCES
Restricted for
Public safety - - 165,514
Highways and streets 448,601 - -
Unrestricted
Committed for commuter improvements - 180,440 -
Unassigned - deficit - - -
Total fund balances 448,601 180,440 165,514
TOTAL LIABILITIES AND
FUND BALANCES 457,159$ 180,665$ 168,569$
ASSETS
LIABILITIES AND FUND BALANCES
VILLAGE OF MORTON GROVE, ILLINOIS
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
December 31, 2012
Special Revenue Funds
- 97 -
Economic Fire Dempster/
Development Alarm Seizure Waukegan TIF Total
-$ -$ 316,929$ -$ 1,018,819$
94,475 - - - 94,475
78,000 - - - 78,000
33,076 - - - 137,579
205,551$ -$ 316,929$ -$ 1,328,873$
23,505$ 10,491$ -$ -$ 45,834$
248,725 2,215 - - 250,940
- - - 112,974 112,974
272,230 12,706 - 112,974 409,748
- - 316,929 - 482,443
- - - - 448,601
- - - - 180,440
(66,679) (12,706) - (112,974) (192,359)
(66,679) (12,706) 316,929 (112,974) 919,125
205,551$ -$ 316,929$ -$ 1,328,873$
Special Revenue Funds
(See independent auditor's report.)
- 98 -
9-1-1
Commuter Emergency
Motor Parking Telephone
Fuel Tax Facility System
REVENUES
Sales taxes -$ -$ -$
Intergovernmental 718,514 - -
Surcharge fees - - 273,226
Charges for services - 135,454 -
Investment income 272 521 241
Total revenues 718,786 135,975 273,467
EXPENDITURES
Current
Public safety - - 259,563
Streets and sidewalks 568,153 144,649 -
Community development - - -
Capital outlay - - -
Total expenditures 568,153 144,649 259,563
NET CHANGE IN FUND BALANCES 150,633 (8,674) 13,904
FUND BALANCES, JANUARY 1 297,968 189,114 151,610
FUND BALANCES (DEFICITS), DECEMBER 31 448,601$ 180,440$ 165,514$
COMBINING STATEMENT OF REVENUES, EXPENDITURES
VILLAGE OF MORTON GROVE, ILLINOIS
Special Revenue Funds
For the Year Ended December 31, 2012
NONMAJOR GOVERNMENTAL FUNDS
AND CHANGES IN FUND BALANCES
- 99 -
Economic Fire Dempster/
Development Alarm Seizure Waukegan TIF Total
312,000$ -$ -$ -$ 312,000$
- - 90,251 - 808,765
- - - - 273,226
- 127,200 - - 262,654
356 - 406 - 1,796
312,356 127,200 90,657 - 1,658,441
- 21,546 405 - 281,514
- - - - 712,802
512,145 - - 112,974 625,119
- 199,458 - - 199,458
512,145 221,004 405 112,974 1,818,893
(199,789) (93,804) 90,252 (112,974) (160,452)
133,110 81,098 226,677 - 1,079,577
(66,679)$ (12,706)$ 316,929$ (112,974)$ 919,125$
Special Revenue Funds
(See independent auditor's report.)
- 100 -
Original
and Final 2011
Budget Actual Actual
REVENUES
Intergovernmental
Motor fuel taxes 550,000$ 567,477$ 573,017$
Miscellaneous 160,000 151,037 131,263
Investment income 50 272 79
Total revenues 710,050 718,786 704,359
EXPENDITURES
Streets and sidewalks
Materials 359,000 263,476 318,225
Lighting 145,000 124,677 112,509
Administrative fees
General Fund 180,000 180,000 180,000
Total expenditures 684,000 568,153 610,734
NET CHANGE IN FUND BALANCE 26,050$ 150,633 93,625
FUND BALANCE, JANUARY 1 297,968 204,343
FUND BALANCE, DECEMBER 31 448,601$ 297,968$
2012
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, 2012
(with prior year actual for 2011)
(See independent auditor's report.)
- 101 -
Original
and Final 2011
Budget Actual Actual
REVENUES
Charges for services 140,000$ 135,454$ 154,567$
Investment income 250 521 781
Total revenues 140,250 135,975 155,348
EXPENDITURES
Streets and sidewalks
Utilities and maintenance
of street lighting 14,800 17,434 2,670
Commodities 9,700 11,715 15,968
Administrative fees
General Fund 105,000 105,000 105,000
Water and Sewer Fund 10,500 10,500 10,500
Total expenditures 140,000 144,649 134,138
NET CHANGE IN FUND BALANCE 250$ (8,674) 21,210
FUND BALANCE, JANUARY 1 189,114 167,904
FUND BALANCE, DECEMBER 31 180,440$ 189,114$
2012
(with prior year actual for 2011)
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, 2012
(See independent auditor's report.)
- 102 -
Original
and Final 2011
Budget Actual Actual
REVENUES
Telecommunications taxes 245,000$ 273,226$ 234,115$
Investment income - 241 438
Total revenues 245,000 273,467 234,553
EXPENDITURES
Public safety
Contractual services 263,242 259,563 274,786
Total expenditures 263,242 259,563 274,786
NET CHANGE IN FUND BALANCE (18,242)$ 13,904 (40,233)
FUND BALANCE, JANUARY 1 151,610 191,843
FUND BALANCE, DECEMBER 31 165,514$ 151,610$
2012
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, 2012
(with prior year actual for 2011)
(See independent auditor's report.)
- 103 -
Original
and Final 2011
Budget Actual Actual
REVENUES
Sales taxes 312,000$ 312,000$ 312,000$
Investment income 3,000 356 535
Total revenues 315,000 312,356 312,535
EXPENDITURES
Community development
Contractual services 377,094 512,145 350,335
Total expenditures 377,094 512,145 350,335
NET CHANGE IN FUND BALANCE (62,094)$ (199,789) (37,800)
FUND BALANCE, JANUARY 1 133,110 170,910
FUND BALANCE (DEFICIT), DECEMBER 31 (66,679)$ 133,110$
VILLAGE OF MORTON GROVE, ILLINOIS
SCHEDULE OF REVENUES, EXPENDITURES AND
2012
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
ECONOMIC DEVELOPMENT FUND
For the Year Ended December 31, 2012
(with prior year actual for 2011)
(See independent auditor's report.)
- 104 -
Original
and Final 2011
Budget Actual Actual
REVENUES
Charges for services 60,000$ 127,200$ 238,506$
Investment income 250 - 319
Total revenues 60,250 127,200 238,825
EXPENDITURES
Public safety
Contractual services 40,000 21,546 5,481
Commodities 10,000 - -
Capital outlay 10,000 199,458 152,246
Total expenditures 60,000 221,004 157,727
NET CHANGE IN FUND BALANCE 250$ (93,804) 81,098
FUND BALANCE, JANUARY 1 81,098 -
FUND BALANCE (DEFICIT), DECEMBER 31 (12,706)$ 81,098$
2012
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, 2012
(with prior year actual for 2011)
(See independent auditor's report.)
- 105 -
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
waster 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 166,177$ 82,379$ 248,556$
Receivables 44,992 16,295 61,287
Prepaid expenses 31,847 - 31,847
Total current assets 243,016 98,674 341,690
Total assets 243,016 98,674 341,690
CURRENT LIABILITIES
Accounts payable 306,862 - 306,862
Unearned revenue - 40,860 40,860
Total current liabilities 306,862 40,860 347,722
Total liabilities 306,862 40,860 347,722
NET POSITION
Unrestricted (deficit)(63,846) 57,814 (6,032)
TOTAL NET POSITION (63,846)$ 57,814$ (6,032)$
NONMAJOR PROPRIETARY FUNDS
December 31, 2012
VILLAGE OF MORTON GROVE, ILLINOIS
COMBINING STATEMENT OF NET POSITION
(See independent auditor's report.)
- 106 -
Total
Solid Municipal Nonmajor
Waste Parking Enterprise
OPERATING REVENUES
Waste charges 1,888,288$ -$ 1,888,288$
Parking charges - 44,325 44,325
Total operating revenues 1,888,288 44,325 1,932,613
OPERATING EXPENSES
Contractual services and other charges 1,820,057 - 1,820,057
Commodities - 370 370
Total operating expenses 1,820,057 370 1,820,427
OPERATING INCOME 68,231 43,955 112,186
NONOPERATING REVENUES
Interest income 150 142 292
CHANGE IN NET POSITION 68,381 44,097 112,478
NET POSITION (DEFICIT), JANUARY 1 (132,227) 13,717 (118,510)
NET POSITION (DEFICIT), DECEMBER 31 (63,846)$ 57,814$ (6,032)$
VILLAGE OF MORTON GROVE, ILLINOIS
COMBINING STATEMENT OF REVENUES, EXPENSES
NONMAJOR PROPRIETARY FUNDS
For the Year Ended December 31, 2012
AND CHANGES IN NET POSITION
(See independent auditor's report.)
- 107 -
Solid Municipal
Waste Parking Total
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers and users 1,887,904$ 50,705$ 1,938,609$
Payments to suppliers (1,855,480) (370) (1,855,850)
Net cash from operating activities 32,424 50,335 82,759
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
Receipts from other funds 11,275 - 11,275
Net cash from noncapital
financing activities 11,275 - 11,275
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES
None - - -
Net cash from capital and
related financing activities - - -
CASH FLOWS FROM INVESTING ACTIVITIES
Interest received 150 142 292
Net cash from investing activities 150 142 292
NET INCREASE IN CASH AND
CASH EQUIVALENTS 43,849 50,477 94,326
CASH AND CASH EQUIVALENTS, JANUARY 1 122,328 31,902 154,230
CASH AND CASH EQUIVALENTS, DECEMBER 31 166,177$ 82,379$ 248,556$
RECONCILIATION OF OPERATING INCOME TO NET
CASH FLOWS FROM OPERATING ACTIVITIES
Operating income (loss)68,231$ 43,955$ 112,186$
Adjustments to reconcile operating income to net
cash from operating activities
Changes in operating assets and liabilities
Receivables (384) (7,810) (8,194)
Prepaid expenses (31,847) - (31,847)
Payables (3,576) - (3,576)
Unearned revenues - 14,190 14,190
NET CASH FROM OPERATING ACTIVITIES 32,424$ 50,335$ 82,759$
SCHEDULE OF NONCASH TRANSACTIONS
None -$ -$ -$
VILLAGE OF MORTON GROVE, ILLINOIS
COMBINING STATEMENT OF CASH FLOWS
NONMAJOR PROPRIETARY FUNDS
For the Year Ended December 31, 2012
(See independent auditor's report.)
- 108 -
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, 2012
Municipal
Employees' Police Firefighters'
Retirement Pension Pension Total
Cash and cash equivalents -$ 470,001$ 289,282$ 759,283$
Investments, at fair value
Equity mutual funds - 13,258,068 12,338,795 25,596,863
Bond index fund - 14,712,838 - 14,712,838
Annuity contracts 9,380,219 - - 9,380,219
U.S. Treasury obligations - - 3,518,400 3,518,400
U.S. agency obligations - - 9,678,967 9,678,967
Municipal bonds - - 115,496 115,496
Receivables
Accrued interest - 59 51,929 51,988
Due from primary government 1,389 - - 1,389
Prepaid expenses - 3,469 - 3,469
Total assets 9,381,608 28,444,435 25,992,869 63,818,912
LIABILITIES
Accounts payable - 10,329 8,644 18,973
Total liabilities - 10,329 8,644 18,973
NET POSITION HELD IN TRUST FOR
PENSION BENEFITS 9,381,608$ 28,434,106$ 25,984,225$ 63,799,939$
ASSETS
See accompanying notes to financial statements.
- 109 -
Municipal
Employees' Police Firefighters'2011
Retirement Pension Pension Total Actual
ADDITIONS
Contributions
Employer 615,264$ 1,568,911$ 1,775,057$ 3,959,232$ 4,436,155$
Employee 46,180 374,358 400,381 820,919 771,303
Total contributions 661,444 1,943,269 2,175,438 4,780,151 5,207,458
Investment income
Net appreciation in
fair value of investments - 2,319,743 1,585,625 3,905,368 728,595
Interest 362,906 1,271 636,366 1,000,543 780,999
Total investment income 362,906 2,321,014 2,221,991 4,905,911 1,509,594
Less investment expense (21,146) (29,680) (67,818) (118,644) (76,612)
Net investment income 341,760 2,291,334 2,154,173 4,787,267 1,432,982
Total additions 1,003,204 4,234,603 4,329,611 9,567,418 6,640,440
DEDUCTIONS
Retirement benefits 1,030,651 2,196,621 1,489,257 4,716,529 4,063,528
Duty/nonduty disability benefits - 132,331 610,710 743,041 621,588
Surviving spouse benefits - 218,782 215,453 434,235 435,583
Refunds - 380,084 - 380,084 -
Administrative expenses - 30,439 50,890 81,329 118,281
Total deductions 1,030,651 2,958,257 2,366,310 6,355,218 5,238,980
NET INCREASE (DECREASE)(27,447) 1,276,346 1,963,301 3,212,200 1,401,460
NET POSITION HELD IN TRUST
FOR PENSION BENEFITS
January 1 9,409,055 27,157,760 24,020,924 60,587,739 59,186,279
December 31 9,381,608$ 28,434,106$ 25,984,225$ 63,799,939$ 60,587,739$
2012
(with prior year actual for 2011)
VILLAGE OF MORTON GROVE, ILLINOIS
COMBINING STATEMENT OF CHANGES IN PLAN NET POSITION
PENSION TRUST FUNDS
For the Year Ended December 31, 2012
See accompanying notes to financial statements.
- 110 -
COMPONENT UNIT - PUBLIC LIBRARY
COMPONENT UNIT
Refer to Note 1 for description of the component unit and the criteria for component unit
classification.
VILLAGE OF MORTON GROVE, ILLINOIS
COMPONENT UNIT - PUBLIC LIBRARY
STATEMENT OF NET POSITION AND BALANCE SHEET
December 31, 2012
Balance Statement of
Sheet Adjustments Net Position
Cash and cash equivalents 2,417,873$ -$ 2,417,873$
Receivables
Property taxes receivable - net 3,053,876 - 3,053,876
Grants 25,000 - 25,000
Prepaids 20,691 - 20,691
Net pension asset - 70,993 70,993
Capital assets, not being depreciated - 79,000 79,000
Capital assets, net of depreciation - 526,466 526,466
TOTAL ASSETS 5,517,440$ 676,459$ 6,193,899$
LIABILITIES
Accounts payable 19,043$ -$ 19,043$
Salaries and wages payable 68,996 - 68,996
Noncurrent liabilities
Due within one year - 7,861 7,861
Due in more than one year - 44,544 44,544
Total liabilities 88,039 52,405 140,444
DEFERRED INFLOWS OF RESOURCES
Unavailable/unearned property tax revenue 3,041,037 - 3,041,037
Total deferred inflows of resources 3,041,037 - 3,041,037
Total liabilities and deferred inflows of resources 3,129,076 52,405 3,181,481
FUND BALANCE/NET POSITION
Net investment in capital assets - 605,466 605,466
Nonspendable in form - prepaid items 20,691 (20,691) -
Restricted for
Specific tax levies 71,346 - 71,346
Committed
Special reserve - facility expansion 80,332 - 80,332
Unrestricted
Unassigned 2,215,995 39,279 2,255,274
Total fund balance/net position 2,388,364 624,054 3,012,418
TOTAL LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCE/NET POSITION 5,517,440$ 676,459$ 6,193,899$
ASSETS
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCE/NET POSITION
See accompanying notes to financial statements.
- 111 -
Original Statement
and Final of
Budget Actual Adjustments Activities
REVENUES
Taxes 3,089,101$ 3,008,473$ -$ 3,008,473$
Intergovernmental 22,000 23,863 - 23,863
Charges for services 7,900 9,923 - 9,923
Fines 32,900 32,478 - 32,478
Investment income 1,500 1,420 - 1,420
Miscellaneous 1,500 2,862 - 2,862
Total revenues 3,154,901 3,079,019 - 3,079,019
EXPENDITURES/EXPENSES
Current
Culture and recreation 3,154,901 2,911,921 46,201 2,958,122
Total expenditures/expenses 3,154,901 2,911,921 46,201 2,958,122
NET CHANGE IN FUND BALANCE/NET POSITION -$ 167,098 (46,201) 120,897
FUND BALANCE/NET POSITION, JANUARY 1 2,178,920 670,255 2,849,175
PRIOR PERIOD ADJUSTMENT 42,346 - 42,346
FUND BALANCE/NET POSITION, JANUARY 1,
AS RESTATED 2,221,266 670,255 2,891,521
FUND BALANCE/NET POSITION, DECEMBER 31 2,388,364$ 624,054$ 3,012,418$
2012
AND STATEMENT OF ACTIVITIES
AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
For the Year Ended December 31, 2012
VILLAGE OF MORTON GROVE, ILLINOIS
COMPONENT UNIT - PUBLIC LIBRARY
SCHEDULE OF REVENUES, EXPENDITURES
See accompnaying notes to financial statements.
- 112 -
STATISTICAL SECTION
This part of the Village’s 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.
113-119
Revenue Capacity
These schedules contain information to help the reader assess the Village’s
most significant local revenue source, the property tax.
120-123
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.
124-127
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.
128-129
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.
130-132
Sources: Unless otherwise noted, the information in these schedules is derived from the
comprehensive annual financial reports for the relevant year. The Village implemented GASB
Statement No. 34 in 2004; schedules presenting government-wide information include
information beginning in that year.
Fiscal Year 2004 2005 2006 2007 2008 2009 2010 2011 2012
GOVERNMENTAL ACTIVITIES
Net investment in capital assets 46,999,596$ 46,920,287$ 49,824,312$ 50,519,769$ 46,369,992$ 43,660,888$ 40,455,570$ 44,804,287$ 44,017,021$
Restricted 1,886,226 2,758,495 1,618,149 1,320,956 1,490,542 15,697,500 19,784,173 11,645,390 13,415,241
Unrestricted (19,709,344) (18,915,303) (16,684,584) (15,865,423) (12,451,299) (24,936,412) (23,196,704) (18,379,105) (20,475,242)
TOTAL GOVERNMENTAL ACTIVITIES 29,176,478$ 30,763,479$ 34,757,877$ 35,975,302$ 35,409,235$ 34,421,976$ 37,043,039$ 38,070,572$ 36,957,020$
BUSINESS-TYPE ACTIVITIES
Net investment in capital assets 213,526$ 291,090$ 431,305$ 779,852$ 1,194,967$ 1,918,346$ 3,844,337$ 4,490,571$ 4,108,087$
Restricted - - - - - - - - -
Unrestricted 526,266 1,298,434 1,518,474 1,557,185 1,396,375 928,429 177,104 409,939 2,044,418
TOTAL BUSINESS-TYPE ACTIVITIES 739,792$ 1,589,524$ 1,949,779$ 2,337,037$ 2,591,342$ 2,846,775$ 4,021,441$ 4,900,510$ 6,152,505$
PRIMARY GOVERNMENT
Net investment in capital assets 47,213,122$ 47,211,377$ 50,255,617$ 51,299,621$ 47,564,959$ 45,579,234$ 44,299,907$ 45,414,747$ 48,125,108$
Restricted 1,886,226 2,758,495 1,618,149 1,320,956 1,490,542 15,697,500 19,784,173 11,645,390 13,415,241
Unrestricted (19,183,078) (17,616,869) (15,166,110) (14,308,238) (11,054,924) (24,007,983) (23,019,600) (14,089,055) (18,430,824)
TOTAL PRIMARY GOVERNMENT 29,916,270$ 32,353,003$ 36,707,656$ 38,312,339$ 38,000,577$ 37,268,751$ 41,064,480$ 42,971,082$ 43,109,525$
Data Source
Audited Financial Statements
Last Nine Fiscal Years
NET POSITION BY COMPONENT
VILLAGE OF MORTON GROVE, ILLINOIS
- 113 -
Fiscal Year 2004 2005 2006 2007 2008 2009 2010 2011 2012
EXPENSES
Governmental activities
General government 4,343,440$ 3,246,565$ 3,556,886$ 4,390,997$ 4,587,340$ 3,987,630$ 3,394,369$ 2,989,799$ 5,634,828$
Public safety 13,554,378 13,301,334 13,752,166 14,558,399 15,324,442 16,452,967 16,785,158 18,359,859 18,526,759
Streets and highways 2,858,425 3,349,491 3,205,566 3,187,348 4,196,379 3,815,984 4,312,475 4,685,104 3,547,591
Sanitation 718,894 455,792 411,845 627,214 632,928 646,686 74,942 - -
Vehicle maintenance 692,770 700,854 752,462 872,991 932,625 752,089 720,434 738,039 816,073
Health and human services 542,572 525,788 557,683 669,564 679,218 717,693 383,133 254,522 266,405
Community development 165,062 1,278,214 2,023,898 2,433,222 2,047,185 778,130 695,599 331,224 470,695
Building and inspectional services 696,468 683,868 710,282 718,784 693,218 812,585 511,905 533,941 699,282
Interest 991,526 905,773 745,013 1,180,450 1,254,168 879,876 1,018,423 1,043,389 862,272
Total governmental activities expenses 24,563,535 24,447,679 25,715,801 28,638,969 30,347,503 28,843,640 27,896,438 28,935,877 30,823,905
Business-type activities
Water and sewer 3,537,103 3,779,714 4,026,028 4,047,889 4,550,240 4,995,861 5,204,329 5,371,031 6,286,120
Solid waste - - - - - - 1,352,270 1,818,505 1,820,057
Municipal parking - - - - - - - - 370
Total business-type activities expenses 3,537,103 3,779,714 4,026,028 4,047,889 4,550,240 4,995,861 6,556,599 7,189,536 8,106,547
TOTAL PRIMARY GOVERNMENT
EXPENSES 28,100,638$ 28,227,393$ 29,741,829$ 32,686,858$ 34,897,743$ 33,839,501$ 34,453,037$ 36,125,413$ 38,930,452$
VILLAGE OF MORTON GROVE, ILLINOIS
CHANGE IN NET POSITION
Last Nine Fiscal Years
- 114 -
Fiscal Year 2004 2005 2006 2007 2008 2009 2010 2011 2012
PROGRAM REVENUES
Governmental activities
Charges for services
General government 1,594,783$ 2,255,978$ 2,202,037$ 2,289,270$ 2,151,555$ 2,068,374$ 2,928,022$ 2,889,549$ 2,870,140$
Public safety 297,149 309,786 314,940 469,729 439,602 478,189 522,603 722,977 668,063
Other activities 411,122 270,090 135,589 88,338 83,477 77,835 98,009 7,981 3,657
Operating grants and contributions 1,069,545 747,462 1,099,295 826,813 699,862 804,094 978,467 882,240 1,002,278
Capital grants and contributions 122,633 109,983 216,256 339,372 55,729 1,244 216,450 278,738 157,618
Total governmental activities
program revenues 3,495,232 3,693,299 3,968,117 4,013,522 3,430,225 3,429,736 4,743,551 4,781,485 4,701,756
Business-type activities
Charges for services
Water and sewer 4,120,267 4,580,331 4,174,016 4,239,458 4,596,060 4,990,281 5,451,711 5,773,298 7,106,948
Solid waste - - - - - - 1,207,409 1,830,623 1,888,288
Municipal parking - - - - - - - 13,660 44,325
Capital grants and contributions - - - - - - 811,519 64,122 64,122
Total business-type activities
program revenues 4,120,267 4,580,331 4,174,016 4,239,458 4,596,060 4,990,281 7,470,639 7,681,703 9,103,683
TOTAL PRIMARY GOVERNMENT
PROGRAM REVENUE 7,615,499$ 8,273,630$ 8,142,133$ 8,252,980$ 8,026,285$ 8,420,017$ 12,214,190$ 12,463,188$ 13,805,439$
NET (EXPENSE) REVENUE
Governmental activities (21,068,303)$ (20,754,380)$ (21,747,684)$ (24,625,447)$ (26,917,278)$ (25,413,904)$ (23,152,887)$ (24,154,392)$ (26,122,149)$
Business-type activities 583,164 800,617 147,988 191,569 45,820 (5,580) 914,040 492,167 997,136
TOTAL PRIMARY GOVERNMENT
NET (EXPENSE) REVENUE (20,485,139)$ (19,953,763)$ (21,599,696)$ (24,433,878)$ (26,871,458)$ (25,419,484)$ (22,238,847)$ (23,662,225)$ (25,125,013)$
- 115 -
Fiscal Year 2004 2005 2006 2007 2008 2009 2010 2011 2012
GENERAL REVENUES AND OTHER
CHANGES IN NET POSITION
Governmental activities
Taxes
Property 7,993,211$ 9,358,810$ 11,485,489$ 11,677,488$ 12,737,951$ 12,799,051$ 13,005,988$ 12,796,737$ 12,620,923$
Sales 6,684,899 6,798,236 7,788,874 7,061,621 6,370,839 5,604,221 5,576,524 5,602,819 5,940,931
Utility 1,177,974 1,267,383 1,185,594 1,213,165 1,206,890 1,144,676 1,159,513 1,154,124 1,119,227
Other 3,832,556 4,627,121 4,719,673 5,223,159 5,293,549 4,773,793 4,746,800 4,715,988 5,231,516
Investment earnings 38,182 147,518 467,427 630,288 394,088 304,129 114,990 73,661 26,846
Miscellaneous 32,090 35,713 95,025 138,578 574,371 295,348 1,170,135 813,078 262,112
Gain on disposal of fixed assets - - - - - - - 25,518 -
Transfers 106,600 106,600 - - - - - - -
Total governmental activities 19,865,512 22,341,381 25,742,082 25,944,299 26,577,688 24,921,218 25,773,950 25,181,925 25,201,555
Business-type activities
Investment earnings 3,044 9,286 11,993 3,652 12,188 3,469 6,296 15,454 13,740
Contributions - - - - - 108,134 8,100 - -
Miscellaneous 29,747 146,429 200,274 192,037 196,297 250,925 246,230 297,636 296,582
Transfers (106,600) (106,600) - - - - - - -
Total business-type activities (73,809) 49,115 212,267 195,689 208,485 362,528 260,626 313,090 310,322
TOTAL PRIMARY GOVERNMENT 19,791,703$ 22,390,496$ 25,954,349$ 26,139,988$ 26,786,173$ 25,283,746$ 26,034,576$ 25,495,015$ 25,511,877$
CHANGE IN NET POSITION
Governmental activities (1,202,791)$ 1,587,001$ 3,994,398$ 1,318,852$ (339,590)$ (492,686)$ 2,621,063$ 1,027,533$ (920,594)$
Business-type activities 509,355 849,732 360,255 387,258 254,305 356,948 1,174,666 805,257 1,307,458
TOTAL PRIMARY GOVERNMENT
CHANGE IN NET POSITION (693,436)$ 2,436,733$ 4,354,653$ 1,706,110$ (85,285)$ (135,738)$ 3,795,729$ 1,832,790$ 386,864$
Data Source
Audited Financial Statements
CHANGE IN NET POSITION (Continued)
Last Nine Fiscal Years
VILLAGE OF MORTON GROVE, ILLINOIS
- 116 -
Fiscal Year 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
GENERAL FUND
Nonspendable
Advance to other funds -$ 19,629$ 72,073$ 55,457$ 1,667,406$ 1,614,804$ 1,588,930$ 1,549,007$ 1,508,930$ 1,546,190$
Prepaid items - - - - - - 6,626 - - 103,495
Restricted for
Public safety - - - - - - - - 116,805 116,805
Specific property tax levies - - - - - - - - - 7,357
Unrestricted/unassigned 3,512,883 3,820,401 6,399,102 9,492,148 8,890,161 8,477,050 5,794,060 5,931,760 5,684,663 5,093,952
TOTAL GENERAL FUND 3,512,883$ 3,840,030$ 6,471,175$ 9,547,605$ 10,557,567$ 10,091,854$ 7,389,616$ 7,480,767$ 7,310,398$ 6,867,799$
ALL OTHER GOVERNMENTAL FUNDS
Nonspendable
Prepaid items -$ -$ -$ -$ -$ -$ 22,336$ -$ -$ -$
Advance to other funds - - - - - - - - - 35,714
Restricted for
Public safety - - - - - 180,400 196,590 191,843 459,385 482,443
Capital improvements - unspent bond proceeds - - - - - 550,497 488,113 6,483,518 4,284,205 2,481,828
Community development 3,036,212 3,359,923 2,961,673 5,495,470 5,003,627 6,003,872 14,452,122 12,671,491 10,771,232 12,360,035
Economic development - - - - - 7,282,950 - - - -
Highways and streets - - - - - 35,727 46,069 204,343 297,968 448,601
Debt service - - - - - 468,461 492,270 232,978 - -
Unrestricted
Committed for community development - - - - - - - - 133,110 -
Assigned for commuter improvements - - - - - 133,254 164,233 167,904 189,114 180,440
Assigned for capital improvements - (1,245,882) (1,011,770) - - - - - 683,421 543,242
Special Revenue Funds (280,448) - - 197,035 9,264,692 - - - - -
Unassigned (1,103,419) (975,505) (1,079,187) (1,494,055) (1,956,874)
TOTAL ALL OTHER
GOVERNMENTAL FUNDS 2,755,764$ 2,114,041$ 1,949,903$ 5,692,505$ 14,268,319$ 13,551,742$ 14,886,228$ 18,872,890$ 15,324,380$ 14,575,429$
Note - The Village implemented GASB Statement No. 54 for the year ended December 31, 2011.
Data Source
Audited Financial Statements
VILLAGE OF MORTON GROVE, ILLINOIS
FUND BALANCES OF GOVERNMENTAL FUNDS
Last Ten Fiscal Years
- 117 -
Fiscal Year 2003 2004 2005 2006
REVENUES
Taxes 17,425,699$ 19,443,960$ 21,830,916$ 24,952,449$
Licenses and permits 1,204,324 1,157,687 1,473,641 1,375,358
Intergovernmental 1,027,777 1,057,227 857,445 1,315,550
Surcharge fees 84,724 76,932 220,634 227,181
Charges for services 399,639 746,743 683,943 700,674
Fines and forfeitures 248,919 253,663 282,892 273,543
Lease and rental income 40,560 45,030 30,832 -
Investment income 180,263 87,412 147,520 467,426
Cable TV 166,471 178,520 184,424 197,272
Miscellaneous 185,050 217,741 222,516 200,746
Total revenues 20,963,426 23,264,915 25,934,763 29,710,199
EXPENDITURES
General government 2,600,514 3,609,971 2,807,443 3,099,624
Public safety 10,149,026 10,611,336 11,627,607 12,918,063
Streets and sidewalks 2,190,002 2,116,517 2,322,281 2,268,649
Sanitation 1,345,668 617,465 455,792 405,715
Vehicle maintenance 587,369 614,449 700,854 752,462
Health and human services 443,960 481,236 503,762 560,598
Community development 146,048 146,426 943,973 1,582,343
Building and inspection services 580,748 617,675 682,764 719,296
Debt service
Principal 1,412,278 1,517,631 1,986,557 1,766,127
Interest 1,098,517 993,538 943,342 690,343
Other charges - - - -
Capital outlay 2,222,756 2,511,099 906,404 958,947
Total expenditures 22,776,886 23,837,343 23,880,779 25,722,167
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES (1,813,460) (572,428) 2,053,984 3,988,032
OTHER FINANCING SOURCES (USES)
Transfers in 722,773 1,049,293 714,669 83,829
Transfers (out)(621,173) (942,693) (608,069) (83,829)
Issuance of bonds 59,405 - 283,198 2,831,000
Issuance of refunding bonds - - - -
Discount on debt issuance - - - -
Issuance of refunding installment note - - - -
Payment to bond escrow - - - -
Other - - - -
Proceeds from sale of capital assets 23,228 18,905 23,225 -
Total other financing sources (uses)184,233 125,505 413,023 2,831,000
NET CHANGE IN FUND BALANCES (1,629,227)$ (446,923)$ 2,467,007$ 6,819,032$
DEBT SERVICE AS A PERCENTAGE OF
NONCAPITAL EXPENDITURES 12.22%11.78%12.75%9.92%
Data Source
Audited Financial Statements
VILLAGE OF MORTON GROVE, ILLINOIS
CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
Last Ten Fiscal Years
- 118 -
2007 2008 2009 2010 2011 2012
24,935,759$ 25,315,956$ 24,051,133$ 24,242,015$ 24,035,551$ 24,639,371$
1,194,285 1,115,215 1,029,669 1,569,517 1,587,662 1,472,977
1,176,429 755,810 805,337 1,194,918 1,160,979 1,250,147
239,671 293,273 270,610 246,812 234,115 273,226
983,358 982,042 873,261 1,014,532 1,152,456 1,067,979
327,835 281,457 346,754 561,349 531,010 609,450
- - - - - -
620,046 393,869 304,129 114,990 73,661 26,846
215,606 224,026 233,278 260,205 259,862 322,937
264,832 628,427 436,783 1,313,163 902,535 240,378
29,957,821 29,990,075 28,350,954 30,517,501 29,937,831 29,903,311
3,176,009 3,829,837 3,235,134 2,941,777 2,299,975 2,960,966
14,809,880 14,878,141 15,393,475 15,899,654 16,948,038 16,841,291
3,027,875 3,236,324 3,029,454 2,754,279 2,752,341 2,974,086
627,214 632,928 644,771 74,942 - -
872,991 932,625 752,089 720,434 738,039 816,073
669,564 679,218 718,045 395,984 255,880 263,187
605,286 2,047,185 529,407 557,192 545,904 766,988
718,083 687,918 807,146 514,832 555,482 698,263
1,940,203 1,701,086 10,144,327 2,434,899 5,390,149 2,649,987
999,340 1,304,359 1,084,892 1,081,772 1,026,638 859,489
101,800 - 94,346 - - -
2,025,571 1,034,105 975,791 4,680,419 3,173,842 2,342,331
29,573,816 30,963,726 37,408,877 32,056,184 33,686,288 31,172,661
384,005 (973,651) (9,057,923) (1,538,683) (3,748,457) (1,269,350)
2,496,092 137,162 136,945 62,630 - -
(2,496,092) (137,162) (136,945) (62,630) - -
9,200,000 - - 5,586,000 - -
- - 10,657,500 - - -
- - (11,975) (3,371) - -
- - 2,685,000 - - -
- - (5,661,824) - - -
103,198 - - - - -
- 17,838 21,470 33,867 29,578 77,800
9,303,198 17,838 7,690,171 5,616,496 29,578 77,800
9,687,203$ (955,813)$ (1,367,752)$ 4,077,813$ (3,718,879)$ (1,191,550)$
10.47%9.96%30.68%12.21%19.95%11.36%
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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 Commercial Industrial Tax-Exempt Assessed Tax Taxable Taxable
Year Property Property Property Property Value Rate Value Value
2002 404,306,538$ 108,778,578$ 142,076,909$ -$ 655,162,025$ 1.027 1,965,486,075$ 33.333%
2003 403,983,918 107,263,051 141,543,205 - 652,790,174 1.084 1,958,370,522 33.333%
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 N/A N/A N/A - 1,055,288,020 0.915 3,165,864,060 33.333%
2009 N/A N/A N/A - 1,030,060,996 0.937 3,090,182,988 33.333%
2010 N/A N/A N/A - 952,917,220 1.021 2,858,751,660 33.333%
2011 N/A N/A N/A - 877,375,226 1.139 2,632,125,678 33.333%
Data Source
Office of the County Clerk
Note: Property in the Village is reassessed each year. Property is assessed at 33% of actual value.
N/A - Information is not available.
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Tax Levy Year 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
VILLAGE DIRECT RATES
General 0.644 0.705 0.778 0.940 0.660 0.559 0.486 0.465 0.528 0.597
Police pension 0.038 0.058 - - 0.142 0.132 0.138 0.162 0.179 0.182
Fire pension 0.048 0.061 - - 0.176 0.151 0.157 0.179 0.199 0.205
Bonds and interest 0.086 0.086 0.075 0.070 0.068 0.058 0.053 0.049 0.075 0.126
IMRF 0.039 0.044 0.024 - - - - - - 0.021
Purchase agreement - 0.003 0.071 0.002 0.002 0.002 0.002 0.052 0.002 0.002
IEPA agreement 0.079 0.079 - 0.065 0.064 0.053 0.049 - 0.027 -
Capital improvement 0.094 0.049 0.046 0.045 0.047 0.040 0.029 0.030 0.011 0.006
Total direct rates 1.027 1.084 0.995 1.122 1.159 0.995 0.914 0.937 1.021 1.139
OVERLAPPING RATES
Morton Grove Library 0.329 0.333 0.299 0.288 0.307 0.266 0.259 0.269 0.335 0.349
School District #68 2.334 2.464 2.178 2.149 2.258 1.931 1.882 1.999 2.133 2.452
School District #69 2.995 3.155 2.794 3.335 3.527 3.124 3.247 3.768 4.357 4.866
School District #67 2.213 2.338 2.129 2.041 2.094 1.859 1.807 1.943 2.203 2.449
School District #63 2.753 2.609 2.624 2.542 2.617 2.276 2.233 2.235 2.499 2.775
School District #70 2.056 2.906 2.792 2.729 2.846 2.506 2.484 2.574 2.890 3.261
High School District #207 1.936 2.012 1.795 1.757 1.826 1.602 1.577 1.617 1.782 1.995
High School District #219 1.776 2.090 2.013 2.007 2.374 2.114 2.120 2.267 2.538 2.904
Community College District #535 0.179 0.186 0.161 0.158 0.166 0.141 0.140 0.140 0.160 0.196
Cook County 0.690 0.630 0.593 0.533 0.500 0.446 0.415 0.394 0.423 0.462
Cook County Forest Preserve 0.061 0.059 0.060 0.060 0.057 0.053 0.051 0.049 0.051 0.058
Consolidated Elections - - - - - 0.012 - 0.021 - 0.025
Metro Water Reclamation District 0.371 0.361 0.347 0.315 0.028 0.263 0.252 0.261 0.274 0.320
Morton Grove Park District 0.377 0.380 0.337 0.325 0.328 0.289 0.272 0.284 0.311 0.365
Skokie Park District 0.419 0.456 0.437 0.407 0.436 0.375 0.386 0.383 0.423 0.476
Glenview Park District 0.492 0.516 0.505 0.490 0.511 0.429 0.429 0.422 0.483 0.538
Maine Township 0.129 0.135 0.122 0.121 0.127 0.114 0.112 0.117 0.131 0.149
Niles Township 0.036 0.036 0.033 0.031 0.034 0.030 0.030 0.032 0.036 0.042
Suburban T.B. Sanitary District 0.006 0.004 0.001 0.005 0.005 - - - - -
North Shore Mosquito Abatement 0.009 0.009 0.008 0.008 0.009 0.008 0.008 0.008 0.009 0.010
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 16,261,661$ 1 1.85%15,814,313$ 2 2.42%
Tower Real Estate 12,953,182 2 1.48%18,560,870 1 2.84%
Schwinge Family Ltd.11,554,048 3 1.32%9,545,731 6 1.46%
Menards 9,402,879 4 1.07%11,541,704 3 1.77%
Bell & Gossett 8,348,684 5 0.95%11,502,100 4 1.76%
Avon 7,997,984 6 0.91%9,203,439 8 1.41%
John Crane 7,737,887 7 0.88%9,652,251 5 1.48%
Schwartz Paper Co - 0.00%9,224,922 7 1.41%
Lawnware Products - 0.00%5,440,575 10 0.83%
Public Storage 5,504,118 8 0.63%- 0.00%
Kraft 5,207,408 9 0.59%7,385,639 9 1.13%
Capital Property Mgmt 5,176,190 10 0.59%- 0.00%
90,144,041$ 10.27%107,871,544$ 16.51%
Data Source
Office of the County Clerk
2012 2003
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
2002 6,726,426$ 6,726,426$ 100.00%-$ 6,726,426$ 100.00%
2003 7,079,618 6,995,656 98.81%- 6,995,656 98.81%
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%
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*
2003 9,532,500$ 3,526,399$ 14,370,574$ 5,134,015$ 3,177,500$ 494,023$ 556,079$ 36,791,090$ 7.06%1,638.73$
2004 8,932,500 3,174,167 13,452,935 5,030,605 2,977,500 428,602 470,567 34,466,876 5.69%1,535.20
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 6.09%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
Note: Details of the Village's outstanding debt can be found in the notes to financial statements.
* See the schedule of Demographic and Economic Statistics on page 128 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 General
Less: Amounts Estimated Obligation
General Available Actual Taxable Bonds
Fiscal Obligation In Debt Value of Per Business-type
Year Bonds Service Fund Total Property*Capita Activities
2003 9,532,500$ 938,338$ 8,594,162$ 1.41%382.80$ 3,177,500$
2004 8,932,500 997,666 7,934,834 1.21%353.43 2,977,500
2005 8,306,250 574,321 7,731,929 1.18%344.39 2,768,750
2006 7,657,500 597,680 7,059,820 0.94%314.45 2,552,500
2007 16,182,500 417,525 15,764,975 1.97%702.19 2,327,500
2008 15,481,250 468,461 15,012,789 1.86%668.69 2,093,750
2009 19,283,750 492,269 18,791,481 1.94%837.00 1,856,250
2010 23,124,800 232,978 22,891,822 2.17%983.75 5,855,200
2011 21,072,950 - 21,072,950 2.05%905.58 5,347,050
2012 18,958,300 - 18,958,300 1.99%814.71 4,775,700
Note: 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 120 for property value data.
VILLAGE OF MORTON GROVE, ILLINOIS
RATIOS OF GENERAL BONDED DEBT OUTSTANDING
Last Ten Fiscal Years
Note: 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, 2012
(1) (2)
Percentage
of Debt
Gross Applicable to Government's
Governmental Unit Bonded Debt Government Share of Debt
Village of Morton Grove 23,713,665$ 100%23,713,665$
TOTAL DIRECT DEBT 23,713,665 23,713,665
SCHOOLS
School District #63 14,445,000 14.50%2,094,654
School District #67 6,020,470 73.23%4,408,648
School District #68 4,190,000 0.58%24,278
School District #69 18,725,000 17.32%3,242,883
School District #70 5,335,000 98.47%5,253,150
School District #71 1,410,000 7.04%99,243
High School District #207 13,020,000 3.45%449,709
High School District #219 133,928,952 15.61%20,906,783
Total schools 197,074,422 36,479,348
OTHERS
Cook County 2,642,235,000 0.61%16,057,865
Cook County Forest Preserve 108,665,000 0.61%660,398
Metropolitan Metro Water Reclamation
District of Greater Chicago 2,258,150,090 0.62%14,009,614
Glenview Park District 13,295,000 0.18%23,343
Morton Grove Park District 1,500,000 99.38%1,490,744
Skokie Park District 5,670,000 0.49%27,677
Total others 5,029,515,090 32,269,641
TOTAL OVERLAPPING DEBT 5,226,589,512 68,748,989
GRAND TOTAL DIRECT AND OVERLAPPING DEBT 5,250,303,177$ 92,462,654$
Overlapping debt percentages based on 2009 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, 2012
Under the 1970 Illinois Constitution, there is no legal limit for home rule municipalities except
as set by the General Assembly.
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Per
Capita
Fiscal Personal Personal Unemployment
Year Population Income Income Rate
2003 22,451 521,469,377$ 23,227$ 4.7%
2004 22,451 605,570,823 26,973 3.5%
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%
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
- 128 -
% of % of
Total Village Total Village
Employer Rank Employees Population Employer Rank Population
John Crane Inc 1 1,350 5.8%John Crane Inc 1 5.6%
Avon Products Inc 2 1,100 4.7%Avon Products Inc 2 4.4%
ITT Bell & Gossett 3 750 3.2%ITT Bell & Gossett 3 3.4%
Schwartz Paper Co 4 445 1.9%Schwartz Paper Co 4 1.9%
Sunstone 5 412 1.8%Revell Monogram Models 5 1.0%
Morton Grove Pharmaceuticals Inc6 250 1.1%Tommy Armour Golf 6 1.0%
Shore Koenig Training Center 7 210 0.9%Shore Koenig Training Center 7 0.9%
Malko Electric 8 180 0.8%Paul J Krez Group 8 0.8%
Paul J Krez Group 9 180 0.8%Morton Grove Pharmaceuticals Inc9 0.8%
Quantum Group 10 135 0.6%Lawnware Products 10 0.8%
Village Population = 23,270 Village Population = 22,451
Note: 2010 is most recent information available.
Data Source
Village business licences
2010 2001
VILLAGE OF MORTON GROVE, ILLINOIS
PRINCIPAL EMPLOYERS
Current Year and Nine Years Ago
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Function/Program 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
GENERAL GOVERNMENT
Administrative 4.5 4.5 4.5 5.0 4.5 4.5 3.5 3.0 3.0 4.0
Community development 2.0 1.5 1.5 1.5 1.5 1.5 1.5 1.0 1.0 1.0
Legal - - 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 7.0 7.0 7.5 6.5 6.0 5.5 5.5 5.5 5.0
Health and human services - - - - - - - - -
Family services 11.5 11.0 12.0 12.0 12.0 9.5 11.5 4.5 4.5 4.5
Building/code enforcement 8.5 8.0 10.0 9.0 8.5 8.0 7.0 4.0 4.0 2.5
PUBLIC SAFETY
Police
Officers 46.0 46.0 46.0 46.0 46.0 46.0 45.0 45.0 46.0 45.0
Civilians 25.5 26.5 25.5 23.5 23.5 23.0 22.0 20.0 18.5 18.5
Fire
Firefighters and officers 43.0 43.0 43.0 44.0 44.0 42.0 40.0 41.0 41.0 40.0
Civilians 3.0 3.5 3.5 3.0 3.0 3.0 30.0 2.5 2.5 1.5
PUBLIC WORKS
Street maintenance 18.5 16.5 16.5 16.5 16.5 16.5 17.5 17.5 17.5 17.5
Engineering 2.0 2.7 3.2 3.2 3.2 3.2 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 14.0 13.8 13.3 13.3 13.3 13.3 12.0 12.0 12.0 12.0
TOTAL 190.5 189.0 191.5 190.0 188.0 182.0 177.0 164.5 164.0 160.0
Data Source
Village budget office
VILLAGE OF MORTON GROVE, ILLINOIS
FULL-TIME EQUIVALENT EMPLOYEES
Last Ten Fiscal Years
- 130 -
Function/Program 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
PUBLIC SAFETY
Police
Physical arrests 546 580 596 710 635 550 651 647 574 580
Parking violations 4,730 4,328 4,164 3,866 5,210 5,171 6,075 8,331 8,933 6,751
Traffic violations 7,556 7,428 6,215 7,681 4,598 4,367 5,092 4,587 4,440 3,686
Fire
Emergency responses 3,004 3,072 3,255 3,246 3,384 3,594 3,249 3,265 3,419 3,360
Fires extinguished 66 58 45 36 38 22 70 59 60 48
PUBLIC WORKS
Street resurfacing (miles)1.50 0.49 0.66 1.41 1.81 0.63 1.33 3.03 4.90 6.65
Pothole repairs (in tons)81.25 80.85 93.74 71.50 121.50 120.00 180.00 189.00 170.75 12.50
WATER
New connections - - 5 27 70 23 1 27 8 9
Water main breaks 98 77 117 55 85 67 91 81 64 70
Average daily consumption 3,453,000 3,306,000 3,416,000 3,050,000 3,180,000 3,500,000 2,999,484 2,969,923 2,670,613 2,745,553
Peak daily consumption 5,713,000 4,428,000 6,736,000 4,964,000 4,955,000 6,200,000 4,374,000 4,167,000 4,498,000 4,412,000
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
- 131 -
Function/Program 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
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 357 357 372 372 372 357 357 357 357 357
Traffic signals 13 13 13 13 13 13 13 13 13 13
WATER
Water mains (miles)97.4 97.4 98.9 98.9 98.9 98.9 98.9 98.9 98.9 98.9
Fire hydrants 1,083 1,083 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
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COMPLIANCE SECTION