A municipal auditor warned Gillespie city officials Monday night that city revenues are likely to be down in the coming months due to the impact of the COVID-19 pandemic on local economic activity.
Brenda Masterson, an accountant with Fleming & Tawfall, CPAs, delivered comments on the annual municipal audit during the regular monthly meeting of the city council, saying the city was in good financial shape at the end of the fiscal year on April 30, 2020. But she cautioned the council to be prudent about upcoming expenditures because of anticipated declining revenues.
“Right now, you guys are doing real good,” Masterson said. “But then, of course, there’s COVID. I don’t know if you’ve seen a decrease in revenue yet but most folks will. I know you don’t spend money unnecessarily but you definitely have to watch your spending in the next few months.”
The city should expect to see decreases in revenue from gaming machine taxes, sales taxes and income taxes in the coming months, Masterson said.
Masterson said some work remains to be done on the annual audit before it is submitted to the state. It is, however, substantially complete and she was able to provide the council with summary sheets comparing revenues and expenditures over the last five fiscal years.
The completed audit, she said, will be more lengthy than past audits because of additional accounting work required to administer grant and loan funds awarded to the city to finance the water infrastructure improvement project, which is nearing completion. Masterson said she also included a section on “compensated absences,” which basically refers to vacation time accumulated by city employees.
“We’re all getting older and starting to retire,” she said. “What do they do when they retire? They look and see, ‘Oh, I have five weeks of vacation time I haven’t used’.” The compensated absences section of the audit, she said, will allow city managers to monitor how much vacation time is on the books and anticipate personnel needs as city workers reach retirement age.
Masterson said she was skeptical when City Treasurer Dan Fisher approached her about spending $10 million to replace water lines throughout the city. But, she said, the audit demonstrates that the city could afford the expenditure and that the project will pay dividends for the city in the future.
“It’s going to work out good; you’re going to be able to make the payments,” she said. “There are lots of projections that a lot of smaller towns are going to dry up. I think the things you are doing, like the new water lines, are going to help you keep your residents here.”
Masterson again praised Deputy City Clerk Krystal Norville for her record-keeping but again reiterated the need for the city to convert to computerized accounting. “Krystal does a good job,” she said. “I hate that it’s still a manual system but she does a good job.”
Manual record-keeping, she said, complicates the audit process and requires a greater investment of time to complete the audit.
Masterson said the audit is due to the state by the end of the month. She said final work on the audit should be completed soon and a finalized report should be submitted to the city by the end of next week.
GRANT PROGRAM TO REMOVE ABANDONED HOUSES
Ald. Dona Rauzi asked city aldermen to canvas their wards for abandoned properties after Peace Corps Fellow Ethan Fogg briefly discussed the availability of a grant program to provide money for raining derelict housing.
Fogg said that the grant, if awarded, would provide up to $70,000 per house to demolish or repair abandoned houses.
“It will have a nice effect on the city,” Fogg said. “Studies show that demolishing abandoned houses will increase the value of neighboring properties.”
Rauzi said the grant application deadline for the current grant cycle is Feb. 16 and that it would be virtually impossible to prepare a successful application in that time frame. “They want too much information too quick,” she said. If aldermen can identify eligible properties, however, she said the city would be in a position to apply for the next round of grants.
“The sooner we get this together, the better chance Gillespie will have,” she said.
The City of Carlinville recently was awarded a grant totaling $110,000 which will be used to raze 16 derelict properties in the city, according to Rauzi.
“What they are looking for are houses that have been condemned and now belong to the city,” Fogg said. One downside to the grant, he said, is that administrative costs are not covered by the grant. If the city hired someone to administer the program, the cost of that employee would be borne by the city.
Fogg recently arrived in the city as a Peace Corps Fellow committed to working on economic development and community development issues. Later in the meeting, the council unanimously approved the first $2,500 payment to cover the cost of Gillespie’s participation in the Peace Corps Fellows program.
Fogg reported that he is in the process of meeting business owners in Gillespie.
“One of my projects is to encourage an online presence,” he said. ‘One way to do that is through Google.” Having a Google presence, he said, increases a business’s chances of attracting customers by 29 percent. “It can benefit your business for the better, and it’s free,” he said.
WATER SYSTEM IMPROVEMENTS
On the recommendation of Committee Chair Dave Tucker, the council unanimously approved paying $18,000 for new intake pumps recently installed at Gillespie Lake to supply water to the city’s water treatment plant.
Also on Ald. Tucker’s recommendation, the council voted to purchase variable flow monitoring equipment to be installed on the new intake pumps. Ameren Electric reportedly will rebate $12,000 to the city for the equipment, leaving the city’s out-of-pocket costs at $3,000 to $3,500.
The new equipment is designed to monitor the intake flow and equalize the load on the pumps to reduce energy consumption.
Council members also approved the expenditure of $1,500 for graphing equipment to monitor activity at the clear wells located at the water treatment plant and approved low bids for chemicals to be used at the plant during the coming year.
MOTOR FUEL TAX RESOLUTION
Following a brief presentation by City Treasurer Fisher, the council voted to approve a Motor Fuel Tax resolution in the amount of $500,000. Fisher said the resolution is significantly larger than in past years because the city anticipates significant road repair to be needed in conjunction with expected sanitation sewer work in the coming year.
The resolution, which must be submitted to the Illinois Department of Transportation for final approval essentially is an appropriation document which sets the maximum amount of motor fuel tax funds the city can spend during the fiscal year.
“I don’t think we will spend anywhere near that amount,” Fisher said.
Richard Fenton appeared before the council to again lodge complaints about drainage issues associated with a new Macoupin County Housing Authority development that he fears will divert stormwater onto his property. Most recently, he said, workers installed rip-rap in a ditch adjacent to the development, which he said will cause water to overflow into the storm sewer and overload the sewer.
David Link, owner of Lumpy’s Tavern, asked about the status of a facade grant he recently was awarded.
“I’ve got bids coming in for a pavilion to go over the concrete patio,” he said, “and I’m going to need the money to pay for it.”
Fisher told Link he should have the grant money in hand by the end of this month.
In other action, the council:
- Approved a resolution authorizing payment of $2,280 from the city’s Tax Increment Financing District to TIF Consultant Keith Moran for work completed on a study to expand the TIF District, mapping and for work associated with closing out a DCEO revolving loan program.
- Approved a resolution to authorize payment of $2,340 for a new door at the Illinois Museum of Coal.
- Approved entering into a cooperative agreement with JAT, LLC to expand the size of the parking lot at the city police department.
- Approved a payment resolution for $7,386 to Haier Plumbing and Heating and $6,113 to Curry and Associates Engineers for work completed on the water infrastructure improvement project.
No action followed a 15-minute executive session to discuss collective bargaining issues in conjunction with the Fraternal Order of Police.