S-1638 - 12/14/2021 - FINANCE - Ordinances Supporting Documents ITEM 11.6.5
BOARD OF TRUSTEES MEETING
VILLAGE OF SAMUEL E. DEAN BOARD ROOM
OAK B RqYc_NKBUTLER GOVERNMENT CENTER
1200 OAK BROOK ROAD
OAK BROOK, ILLINOIS
630-368-5000
AGENDA ITEM
Regular Board of Trustees Meeting
Of
December 14, 2021
SUBJECT: 2021 Budget Amendment
FROM: Jason Paprocki, Finance Director
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BUDGET SOURCE/BUDGET IMPACT: Increasing General Fund account 271-80200
(Transfer Out)by$3,000,000 and increasing Infrastructure Fund account 41-48150(Transfer From
Other Funds)by$3,000,000.
RECOMMENDED MOTION: I move the Village Board adopt Ordinance 2021-BU-AMEND-
-S-1638 "An Ordinance Authorizing an Amendments And Transfers Among Budget Line Items"
for the transfer of funds from the General Fund to the Infrastructure Fund.
Backaround/History:
During the course of a year, there are numerous situations that may arise that cause an account,
program, or even a fund to exceed its budget. When this occurs, State statutes provide that the
corporate authorities may make transfers from "one corporate object or purpose to another
corporate object or purpose". Additionally, statutes provide that the corporate authorities may
delegate authority to heads of municipal departments to "delete, add to, change, or create sub-
classes within object classes budgeted previously to the department with the approval of the budget
officer or executive officer of the municipality". The Village has defined a corporate object or
purpose to be an individual program or fund. Sub-classes within object classes have been defined
as accounts and categories within a budget program.
The Village Board's policy on Finance, Taxation, and Budget, prepared based on the
previously mentioned statutes,outlines the following procedures for budget administration
and how these variances are to be addressed:
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1. That the Budget Officer, with the approval of the Village Manager, may
authorize transfers of budgeted funds between accounts or between account
categories within a single budget program.
2. That any transfer of budgeted funds from one budget program to another shall
be subject to approval by the Board of Trustees upon the recommendation of the
Village Manager.
3. That any transfer from contingency shall be subject to approval by the Board of
Trustees upon the recommendation of the Village Manager.
4. That any increase in the total appropriation within any fund shall be subject to
approval by the Board of Trustees upon the recommendation of the Village
Manager.
Current 2021 projections reflect a General Fund increase of$4,082,160. This is a result of
many of the Village's major revenue sources coming in significantly higher than originally
budgeted. The General Fund cash balance is now projected to be$28.0 million at 12/31/21,or
14.8 months, of the proposed 2022 base operating budget. The Village's policy is to have a
reserve balance of 6.0 months of the base operating budget.
At the December 2, 2021 Finance Committee meeting, the committee discussed a proposal to
make a one-time transfer of$3,000,000 from the General Fund to the Infrastructure Fund to
fund future capital projects. In the current five-year plan,the Infrastructure Fund cash balance
nearly reaches zero due to the planned capital spent. After the proposed transfer, the General
Fund cash balance would be projected at $25.0 million, or 13.2 months, of the proposed 2022
base operating budget. This is more than double the 6.0 month Village policy.
The attached budget amendment proposes a one-time transfer from the General Fund to the
Infrastructure Fund of$3,000,000 to occur in the 2021 budget year. This amount will not be
repaid in the future.
Recommendation:
The Village Board adopt Ordinance 2021-BU-AMEND-S-1638 "An Ordinance Authorizing i
an Amendments And Transfers Among Budget Line Items" for the transfer of funds from the
General Fund to the Infrastructure Fund.
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