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Geneva, IL 60134

Kane County

KC Finance and Budget Committee

Meeting Minutes

BERMAN, Lenert, Juby, Lewis, Sanchez, Surges, Tepe & ex-officios Pierog (County Chair)

Wednesday, June 12, 2024

2:00 PM

County Board Room

***SPECIAL MEETING***

Call To Order

Chairman Berman called the meeting to order at 2:06 PM.

Roll Call

Board Member Dale Berman

Board Member Leslie Juby

Board Member Vern Tepe

PRESENT

Ex-Officio County Board Chair Corinne M. Pierog

Board Member Anita Lewis

Board Member Jarett Sanchez

Board Member Bill Lenert

REMOTE

ABSENT

Board Member Clifford Surges

Also present: Co. Bd. Members Allan*, Bates*, Gumz*, Kious*, Molina*, Roth; Fin.

Exec. Dir. Hopkinson; ITD CIO Lasky* & staff Kash; KCAC Admin. Youngsteadt*; and

members of the press and public.

Remote Attendance Requests

Chairman Berman announced the remote attendance requests for today's meeting. He

asked the Committee if there were any objections to Committee Members Lewis,

Sanchez and Surges attending today's meeting remotely. There were no objections.

Approval of Minutes: None

Public Comment (Agenda Items)

None.

Public Comment (Non-Agenda Items)

None.

10.

New Business

Discussion on Budget Cuts Approach

Chairman Berman introduced the discussion on the County's approach to future budget

cuts. He shared his suggested discussion points. He questioned the Committee to

decide if budget cuts would be necessary for the FY2025 budget, or to focus on

FY2026 and beyond. In his opinion, it is too far along in the FY2025 budget process to

enforce budget cuts. The Committee provided their feedback on this matter.

Berman asked this Committee their views on balancing the budget using the excess

reserves and if they would rather continue spending down reserves or enforce budget

cuts. Much discussion ensued. The Committee agreed to seek other avenues to

increase revenue, while figuring out the correct amount for budget cuts. Berman asked

this Committee if they would like to suggest to the County to continue to use the

reserves to balance the budget for the time being. Further discussion ensued on the

different avenues the County has to find revenue sources. The Committee agreed that

the County should continue to spend down the excess reserves to balance the budget.

Berman asked for input on the overall goal of this Committee for the budget process.

Each Committee Member provided their feedback. Discussion ensued.

Committee Member Tepe explained that the County should continue to spend down

the excess reserve amount to balance the FY2025 Budget. However, reserves are not

the only funding being depleted. The County's Capital Fund has not had a major

contribution for some time. Tepe explained that the current capital projects being

completed are being augmented by the funding given to the County by the American

Rescue Plan Act (ARPA). He added if the County is going to have a building program,

then they must find a way to fund the Capital Projects. Referencing a previous financial

presentation he provided, Tepe came up with an average annual basis gap of $15M

between the County's revenues and expenses. He provided his suggestions on how

the County could begin to close that financial gap. First, the County can begin to utilize

the annual Property Tax Extension Law Limit (PTELL) increases, which would provide

approximately $2M annually. Second, the County could increase the Local Motor Fuel

Tax, in which would be given to the Kane County Division of Transportation (KDOT).

Additionally, they could reallocate the RTA Sales Tax, which would give the County

$6.3M. All of these suggestions are items the County Board could implement now.

Lastly, the County could discuss the implementation of a County sales tax and cuts to

personnel.

Fin. Exec. Dir. Hopkinson explained that a County Strategic Plan needs to be

developed. During the creation of this plan, it will allow the County to learn how

resources can be allocated across the County and would assist in budgeting. Madam

Chairman Pierog added that this plan would identify the County Board's priorities and

goals and provide outreach to the communities. In saying this, a strategic plan would

take time to develop, which in turn, causes a larger fiscal cliff the County will have to

address. Hopkinson listed the numerous County funds that are being balanced by

reserves. She explained that within the FY2023 Budget, the General Fund budgeted

$17M use of fund balance reserves. While the Finance Department finishes the Audit

Report, they have found that the actual loss for FY2023 was $5.5M. Hopkinson has

predicted that FY2024 will be a higher loss due to equity adjustments and significant

pay increases in union contracted rates. This trend will continue to spend down the

County's reserves. If the County were to reallocate funding, such as moving money

from the RTA Sales Tax fund from the Transportation Department to the General Fund

and increase the Local Motor Fuel Tax, that would provide approximately $6M-$7M.

This would be beneficial to the General Fund, however, the County has already

budgeted about $10M in reserves for FY2025.

Committee Member Juby stated that it is not prudent of the Committee to be planning

budget cuts on two forms of revenue that have continually not had support from

constituents. The discussion today should be focused on the facts, such as the County

does not have the Consumer Price Index (CPI) to utilize and they are not going to

increase the Motor Fuel Tax. Juby voiced her opposition on implementing a set budget

cut percentage for all County departments/offices. This would be unfair to those

departments/offices that are much smaller. Berman stated that an additional discussion

item that the Committee should keep in mind is when they determine what the actual

cuts will be, what affects will occur to County services. With that in mind, how should

the County Board view these cuts versus implementing the CPI or increase in fuel tax?

Discussion ensued on the amount of money would be allocated to each departments in

order to reach the overall goal of cutting the budget. The Committee decided to figure

out an exact dollar amount to cut from the budget. Additionally, they would look at the

percentage of each department's share in the overall County budget and direct them to

try to cut the suggested amount. Lastly, the County should try to reallocate County

funding, such as the RTA Sales Tax.

Tepe summarized the goals and priorities of this Committee. He asked a series of

questions to the Committee for consensus. The Committee asked Hopkinson to figure

out some dollar figures pertaining to departments and budget cuts. This will allow the

Committee to see the overall options they have to address the County's fiscal cliff.

Much discussion ensued. Tepe suggested that this Committee receive

departments/offices' budgets to help figure out a targeted number. Once this number is

figured out, this would be the amount this Committee would present to the County

Board for budget cuts. Additionally, this Committee would present funding alternatives.

The Committee provided consensus. Further discussion ensued.

The next Special Finance Committee meeting will be scheduled for Monday, July 1,

2024 at 2:00 p.m.

11.

12.

13.

Old Business

None.

Committee Chairman's Comments

None.

Executive Session (if needed)

None.