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Minutes - 11/02/2021 - Finance Committee Finance Committee November 2, 2021 6:00pm Call to Order The Finance Committee meeting of November 2, 2021 called to order by Trustee Michael Manzo at 6:01pm in the Upper Level Conference Room of the Butler Government Center. Roll Call PRESENT: Trustees Mike Manzo, Larry Herman and Asif Yusuf (left at 7:45), Anne Huber, Jim DePhillips, Jim Tomaselli and Moin Saiyed and Don Adler (via Zoom) ABSENT: Al Koren ALSO IN ATTENANCE: Finance Director Jason Paprocki, Village President Gopal Lalmalani, Trustee James Nagle, Trustee Suresh Reddy and Interim Fire Chief James Arie, Wes Lomnicki and Dave DiTomasso of Premier Athletics Management Public Comments Wes Lomnicki and Dave DiTomasso share their presentation of Premier Athletics Management proposal. They begin their presentation by saying that the anchor tenant would be their Soccer Club and they believe they can do well for the Village. They go through their Power Point, saying that they are a new company, but individually have lots of experience. They will be proposing a revenue share if they have a successful year. Theproposal includes overseeing and managing the day to day operations of the Sports Core fields, including scheduling, they would like to rent the Sports Core office, reimburse the Village for field maintenance, and plan to book 4-6 large scale events each season. They go on to offer the Village an upfront payment of $50,000. Messrs. Lomnicki and DiTomasso touch upon their desire to utilize the fields to their fullest capacity and the need for parking lot expansion. Conversation ensues regarding what elements need to be in the lease agreement with Premier Athletics Managements. The PAM representative shares that they have a donor who would be willing to cover costs such as artificial turf somewhere down the line. They go on to say that they would also be willing to help drive memberships from their organization to the Bath & Tennis Club they also touched upon the possibility of concessions at the soccer fields, hosting kids’ camps, professional training camps and summer leagues. Discussions and Presentations Sports Core Discussion – Revenue vs Expenses Trustee Herman begins the discussion by stating that the relationship with the Park District has been officially severed, and the Village is taking over management. He lists the responsibilities that will need to be covered by the Village or management company. He talks about the Clubs in the swim team conference and the services that they are using. He shares that the Park District, despite the season being a debacle, had in excess of 400 members. If the Village is successful in retaining that amount of member the Club will not lose money. Conversation shifts to capital improvements, other expenses, construction issues from last season and the litigation with the pool contractor. Trustee Herman states that his plan to grow memberships, raise prices and turn around the Club is a three year project. His vision is to generate a surplus that will go MINUTES OF THE NOVEMBER 4, 2021 MEETING OF THE FINANCE COMMITTEE OF THE VILLAGE OF OAK BROOK APPROVED AS WRITTEN OR AMENDED ON DECEMBER 2, 2021 into a reserve fund. Conversation ensues regarding the measurement for success of the Club and circles back to outsourcing. Trustee Herman brings the conversation back to his three year plan which will include implementing an online registration through a new online software, creating a new website, he is working with the current tennis pro on tennis programs and maintenance and turning one of the courts into pickleball courts. Discussion turns to marketing, employees, who will be running the B&T and steps going forward. Approval of Minutes September 27, 2021 Motion to approve the Meeting Minutes of September 27, 2021 made by Suresh Reddy seconded by Anne Huber. All in favor no opposed. Minutes approved. Don Adler asks about the status of the Business Registry. Trustee Herman explains that the Village attorney is working on the Ordinance and operationally, there is a plan to contract with Tyler Technologies to purchase a module to facilitate electronic submission and payment of permits, this module will also be used for the business registry. He believes that it will be ready by mid-2022. Larry Herman goes on to explain that Jason Paprocki has been in contact with Oakbrook Center to get a list of headquarter addresses for some of the stores that may not be in compliance with Illinois sales tax requirements, so that they can contact them. Health Insurance Discussion Trustee Manzo begins the conversation by stating that they will be doing some work to see who is participating on the Village’s health insurance plan and where the bulk of the claims are coming from. Trustee Herman will be having a meeting with Kathy Vonachen and the health insurance brokers to start exploring other avenues. He would like to see the Village move to a managed care policy. Union Negotiations – Daytime population as it relates to Police/Fire Trustee Manzo starts by saying that since he has been involved with the Village they have always used a daytime population of 100,000 and he believes that number is incorrect. He hopes that the business registry will help to get a more accurate number, this will aid in union negotiations. Lease vs Purchase Analysis Trustee Manzo begins by saying that the committee is going to revisit leasing versus purchasing. Jason Paprocki adds that the Village doesn’t know yet what the long term cost of leasing will be. There is an upfront savings but the maintenance costs are a variable. Trustee Herman says that the Village is taking possession of two fire vehicles that were approved late last year by the Board, who were under the impression that they were being leased when in fact they are under a purchase contract with an extended warranty. Interim Fire Chief James Arie gives his opinion on the ladder truck that has been purchased and the one that was traded. Jason Paprocki further explains that he was not completely involved in the fire truck purchase. Conversation ensues regarding purchasing, leasing, warranties, and maintenance. Budget Discussion per Department Finance Director Jason Paprocki begins by going through a summary of all the Village funds, noting that the General Fund is budgeted to have an increase of $117,425 and the Capital Projects Fund is showing a decrease of 5 million dollars. He goes on the say that the General Fund is showing 13 months of reserves, more than doubling the requirement. He moves on to the Capital requests, mentioning the large increase in Computer Hardware and Software due, in part, to the permitting and business registry. Trustee Manzo asks about the Station 94 Kitchen Remodel for $75,000 and conversation ensues regarding the scope of that project. Director Paprocki points out the new format for reporting some of the capital projects, giving them their own page with more detail, a priority level and projected impact on operating costs, this will allow for the creation of a capital only budget. He moves onto Personnel and highlights some of the significant changes; Public Works combining the Street Forman and the Water Forman into one position, the addition of a cook at the golf course, the removal of the Police Deputy Chief and the possibility of adding one Fire Battalion Chief. Conversation shifts to the food and beverage operation. Trustee Manzo is pushing for outsourcing, Jason Paprocki shares that the profit from 2021 to date is around $260,000. Conversation ensues regarding the pros and cons of outsourcing. Talk shifts to the need for rear round employees. Trustee Herman shares that the liquor margin is around 80% and the food margin is around 40%. Trustee Yusuf suggests waiting another a year before talking about outsourcing. There is a motion to move forward with outsourcing the food and beverage operation. Conversation shifts to employee compensation and raises. Director Paprocki explains that for budgeting purposes they use a 3.5% increase. Trustee Manzo says that the Board need to address the evaluation process, it is merit based but everyone gets the top raise. He believes that it isn’t a true evaluation, friends are evaluating friends. Jason Paprocki answers by saying that he does see lower scores and that the forms could use an update. Conversation continues regarding evaluation matrixes and goals and objectives. Trustee Nagle suggests that there is a morale problem, he suggests doing anonymous employee survey about the Board and supervisors. Conversation ensues regarding the evaluation process, it is suggested that the new Village Manager should address this. Director Paprocki continues with the summary of the budget addressing the sales tax figures saying that they are very conservative. Conversation ensues regarding the pandemic boost, new establishments adding to sales tax, consumers coming to Oak Brook as opposed to downtown. Trustee Herman, circles back and mentions that it important for the Village to stay competitive in this job market. Jason Paprocki continues by saying that raises look high in the current budget and that’s because in last year’s budget there were no raises so this year it’s actually two years worth. He then goes back to the Sports Core revenue and explains that his numbers for the Bath & Tennis Club are based on the 2019 before the Park District took over, and these figures will be adjusted as he received more information from the Park District’s operation. Conversation shifts to the Taste of Oak Brook. Trustee Nagle asks for a better understanding of how the numbers are decided for the capital projects, whether it’s based on quotes or just estimates. Director Paprocki explains that the engineers, contractors or the reserve study and these numbers are just place holders. When it is decided to do the project they get an authorization to seek bids from the Board. The Board then makes the decision to proceed based on the bid prices. The committee thanks Jason Paprocki for all his work. Adjournment Motion to adjourn made by Jim Tomaselli seconded by Jim DePhillips. All in favor no opposed. Meeting adjourned at 8:45pm. ATTEST: ________________________ _____________________ Connie Reid Date Executive Assistant Village of Oak Brook