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DeKalb County, Illinois |
Minutes of the
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The Administrative Services Committee of the DeKalb County Board met Wednesday, June 6, 2001 at 7:00 p.m. at the DeKalb County Government Administrative Building’s Conference Room East. Chairman Steimel called the meeting to order. Mr. Hoffman, Mr. Hutcheson, Ms. Leifheit, Mr. Morreale, Mr. Pritchard, Ms. Tobias, and Mr. Wilson were present. Ms. Conway was absent. Also present were Ms. Joan Berkes, Mr. Ray Bockman, Mr. Ken Campbell, Ms. Eileen Dubin, Mr. Gary Hanson, Ms. Christine Johnson, Ms. Karen Kahl, Mr. Greg Millburg, and Mr. Fred Lantz.
APPROVAL OF MINUTES
Mr. Hutcheson moved, seconded by Mr. John Morreale to accept the minutes of the April 4, 2001 meeting. Motion carried unanimously by a voice vote.
APPROVAL OF AGENDA
Mr. Hoffman moved, seconded by Ms. Tobias to approve the agenda with an additional item of the Budget Calendar to be discussed as item 7a. Motion carried unanimously by a voice vote.
DEEDS FOR PROPERTY SOLD AT TAX AUCTION
Ms. Johnson, reminded the committee of this project which was created last year. It is a statutory requirement that the County take deed of delinquent properties and dispose of them by sale. The committee then approves a resolution to deed the property to the buyer and pass it along to the County Board. The County offered eight properties up for sale and sold three. Ms. Johnson suggested that the benefit of this action is to put properties back on the tax roles. Ms. Tobias questioned Ms. Johnson about the outcome of properties that are not sold. Ms. Johnson explained that the County offers the properties up for sale on an annual basis until they are sold.
Ms. Leifheit moved, seconded by Mr. Wilson to pass all three resolutions to deed the property to the buyers and to pass them along to the full County Board. Motion carried unanimously by a voice vote.
REVIEW OF ANNUAL AUDIT REPORT
Chairman Steimel introduced Mr. Fred Lantz from Sikich Gardner & Co., LLP Certified Public Accountants, who prepared the County’s audit. Mr. Lantz thanked the chairman and members of the committee for inviting him to the meeting to present the
information resulting from the audit of the County as of the fiscal year ending November 30, 2000. He presented two documents for the committee’s review which are the primary documents. The first is the Comprehensive Annual Financial Report (Audit), and the Recommendations for Improvement. In addition, he issued ten reports in total from the audit of the County as a whole. Reports were prepared on the Forest Preserve District, a separate Letter of Recommendations on the Forest Preserve District, Public Building Commission, a separate Letter of Recommendations on the Public Building Commission, a separate Letter of Compliance Audit for the Circuit Clerk of the Court, a single audit of federal expenditures and federal financial assistance, (the County received and disbursed a little over $650,000.00 in federal funds) which required them to perform a single audit over that federal assistance and report the findings to the federal government), and the State Annual Financial Report which is filed electronically at the States Comptroller’s Office.
Mr. Lantz noted that several committee members were new to the Administrative Services Committee and wanted to familiarize them with the documents. He reported that the report was well beyond the minimal requirements of generally accepted accounting principles. He stated that this report contains a wealth of information and received an unqualified opinion from the auditors, participated and received the Certificate of Achievement for Financial Reporting, and is recognized for producing and publishing excellent Comprehensive Annual Financial Reports. He commended the County for the achievement. He recommended that under the Introductory Section, Letter of Transmittal iv - xvi, is the best place to find the key financial points in the County. He moved on to the Financial Section which contains the detailed information. He explained that after the Independent Auditor’s Report is the General Purpose Financial Statements (comprised of five) which is the minimum required by general accepted accounting principle (pages 3-37). He stated that the material provides the reader with an overview of the County as a whole (including the Forest Preserve District and the Public Building Commission) for the year ending November 30, 2000. He explained that the Required Supplementary Information section listed the trend information for the County’s participation in the three primary retirement funds. He instructed the committee to turn to the end of the table of contents to the Statistical Section and informed them that the section included ten year trend information on the finances of the County.
After the overview of the audit, Mr. Lantz went over the Independent Auditor’s Report. He said he was pleased to present to the Chairman and members of the committee with a clean, unqualified opinion on the financial statements of the County, Forest Preserve District, and Public Building Commission for the year ended November 30, 2000. He reported that they were please to issue three unqualified opinions on the County’s single audit report and that there were no findings or questioned costs. He reported that it was quite an accomplishment for the County. He did however, warn the committee that it would become very difficult for the County to achieve this in the future due to the new reporting model for state and local governments effective in the fiscal year ending November 30, 2003. He reported that currently there is no answer to the question, "where is the bottom line?" The first page of the new reporting model is coming up with that basic statement. Everything in the back of the report would remain about the same. He reported that they would take the numbers and adjust them to the full basis of accounting for the County as a whole in a one-column presentation. Two major components go along with that, the first of which is depreciation of facilities which the County is not required to do now except for the Nursing Home. The Nursing Home is accounted for as an enterprise fund and as such they do charge out for depreciation. He went on to explain the second requirement will be to retroactively report all of the County’s infrastructure assets (roads, bridges, curbs, gutters, etc).
He reported that the new reporting model in the past had a lot of movement against it but is now being embraced by major governments across the country and is anticipated to reach full implementation and therefore, generally accepted. He reminded the committee of Mr. Bockman’s question last year of what would happen if the County did not implement this practice. He said that there is a new twist by the ICPA (the standard body that sets the rules that the auditor’s must follow when auditing governments and procedures he must perform in order to issue an unqualified opinion). He stated that it appears that the ICPA is about to come up with guidelines that if you do not adapt the new model the auditor’s will not be allowed to issue a clean unqualified opinion. The only option the ICPA will give to the auditors is for them to give an adverse opinion. Mr. Bockman’s said that he has found some advantages since last year that he has been made aware. He stated that he still feels that as a whole it is going to scare a lot of citizens unnecessarily.
Mr. Lantz then went on to commend the County, especially the Finance Office, for a much smoother audit this past year. He recognized the addition of a staff member who does an excellent job, assisting Mr. Hanson in doing a lot of leg work and pulling things together. He also suggested that the County may need yet another person in the future to deal just with fixed assets. Ms. Dubin asked if there were outside agencies that rates these reports? Mr. Lantz cited two, Moody’s and Standards and Poors.
Recommendations noted few minor improvements in the current year and that the majority of the improvements in prior years have all been implemented or are in the process of implementing. There were no reportable conditions. (1) Allocation of Costs -Central Plant’s portion of FICA is expensed but not reimbursed and (6)Allocation of Health Insurance Costs (e.g., health insurance) are not being allocated to the department but rather reported under non-departmental. He is encouraging that through the budget process, costs should be allocated out to each of the respective departments helping ease the implementation phrase. (2 & 4) Bank reconciliations (e.g. County Clerk and Circuit Clerk) hold old outstanding checks that need follow up. He recommends they write them off to a liability account to remove them from Bank Reconciliation. Mr. Steimel asked about the expiration date of a check and Mr. Lantz stated it was 7 years then it is to be turned over to the State. The State then takes an additional 7 years to try to find the rightful owner and if they don’t find the true owners after 7 years it reverts back to the State’s General Fund (which has over $20 billion unclaimed assets) website: http://www.cashdash.net.
One item he wanted to pointed out in regards to the Financial Section was the Nursing Home (11&12 of Large report). There was a question about the Nursing Home’s ability to turn a profit. The Nursing Home reports that it lost $1.2 million last year. This is deceiving because they did not lose $1.2 million. On page 11 under Nonoperating Expenses, the loss on disposable fixed assets lists the disposal of the depreciated old Nursing Home therefore if you subtract that cost, the Nursing Home made a profit of a little less than $400,000.00. All pension plans are in very well funded status. The County’s IMRF fund is overfunded by 15-20%, the Forest Preserve District is at 99% funded, and the Sheriff’s Law Enforcement’s Personal is at about 97% funded, Mr. Lantz told the committee.
Mr. Wilson asked for clarification on page 9, under Other Financial Sources. Mr. Lantz explained that the transfer of $2,700,000 out of the general fund covered costs of the capital project funds (new Legislative Center and the new Highway Facility) and the remainder of funds went to cover the County’s matching component on some Federal and State grants.
Mr. Pritchard asked if on page 159 the Cash On Hand was listed under the Treasurer’s monthly report? Mr. Lantz said it would to a certain degree but reminded him of the other entities that are blended in, such as Forest Preserve District, Public Building Commission, department passbooks, and department checking accounts. Mr. Pritchard asked if this was the best accumulation of account balances as of November 30, 2000? Mr. Lanz confirmed his statement. Mr. Hanson added that it was not necessarily reflective of all the fund balances because people would owe the County money or the County would owe people money so fund balances could be quite a bit different than the cash balances. Mr. Morreale asked if all the information could be made available on the County’s website? Mr. Lantz stated that the document has so much information in it that very few clients put the total document on their websites, however, they do make available the Letter of Transmittal. Mr. Hanson stated that the County does post the Letter, Financial Statements, and ten year trends. Mr. Steimel thanked Mr. Lantz and his staff, and Mr. Gary Hanson, and his staff for the work and quality of work that went into the audit. Mr. Hanson then took the opportunity to introduce Karen Kahl, Accounting Supervisor who was the new addition to the Finance Office nearly one year ago.
IMO QUARTERLY REVIEW
Ms. Berkes, Director of the Information Management Office (IMO) distributed a handout which is on file in the Finance Office with these minutes which outlined her department’s second fiscal year quarter’s activities, ongoing projects, and upcoming activities and goals.
Activities:
She reminded the committee that the last time she reported, she was experiencing difficulty with AT&T connecting to the Highway Department. Highway is now working fine internally but do experience slow speeds of connectivity from their facility to her location and is being addressed.
Adding Property Characteristics to the Tax System.
Completed the aerial reflight project. The County was reflown and the digital files will be coming in throughout the year. The City of DeKalb helped by painting targets.
The cabling of the Circuit Clerk’s office and courtrooms was a huge project. They now have 105 connections. A local area network will be created to connect to. A few people in her office are networked but the majority are not. Most work on dumb terminals. This will be a major step for them.
The County’s Intranet debuted (a multimedia presentation given later)
On Going:
Interactive training tool. The department arranges classes to help others in learning but is difficult to coordinate people’s schedules. They are evaluating software which allows departments the ability to screen potential employees and doubles as a training tool for employees.
She has welcomed back a college student (Garret Stephenson) to work on some database projects.
She filled the "Database Experiment Project." Vendors are not interested in undertaking small database projects because they are not able to resell them and are strictly customized. It is cost prohibitive for the County to use large vendors. She has eleven requests for databases to date.
Redistricting Projects are underway.
Ms. Berkes finished her report by going over the upcoming activities and goals. The biggest project was the Circuit Clerk Project Implementation.
Ms. Berkes dimmed the lights and presented the "Infocenter", the County’s Intranet, information available to networked employees only. She stated that, "The Intranet was designed with the intent to enable the sharing of digital information." She reported that she is encouraging employee’s to make this their own. The work involved for this project requires documents to remain current and not become outdated. The first place that you start covers the following:
Chairman’s Message - Mr. Pritchard provided an inspirational message for the County employees. Computer Questions of the Week - IMO gives prizes to winners if they successfully answer a computer related question. Contracts, CountEBoard Packet can now be viewed. The County’s Board is a forum for a community bulletin board. Employee Service Awards -Recognized Achievement. Forms and Policies were the result of an organized meeting with herself, Ken Campbell, and Gary Hanson to gather forms employees ask for and make them available with ease. Finance Office -has much information for Accidents, Accounts Payable, Benefits, and Payroll needs. GIS is coming soon. Holiday Calendars are posted. Internet Home Page - is made available to those who do not have internet access. Links are a helpful resource. News & Views will have the County’s Newsletter. Suggestions can be e-mailed for improvements. The Telephone Directory is also listed and is up to date. She finished her demonstration and Chairman Steimel thanked her for showing it to the committee.
DISCUSSION OF COURTHOUSE TUCKPOINTING
Mr. Ken Campbell, Facilities Manager informed the members that after the month of April he does roof inspections of the buildings to see how they faired over the winter months. Recently he was on the courthouse roof and noticed some serious problems with the tuckpointing. He produced photos that he had taken and are on file in the Finance Office along with these minutes. There are 6 or 7 ballisters which are loose and cracked from water damage to steel pins that are rusting out and need to be replaced. While examining a cracked ballisters, it fell apart into his hand and other pieces fell to the yard below. He said he would like to get it tuckpointed and then monitor the results to make sure there is no movement. He received proposals to do emergency work from three different vendors. The estimates are approximately $25,000. Next year he would like to fill in missing mortar that needs to be ground out at a cost of approximately $30,000. Mr. Campbell then asked if the committee would grant the permission needed to proceed.
Mr. Morreale questioned if this project should be asked of the Public Building Commission? Mr. Hanson said that it has to start in the Administrative Services Committee to approve the project before it moves to the Public Building Commission. He went on to say that the money ultimately comes from the County’s annual appropriations. Chairman Steimel asked how long it has been since work was done on the courthouse roof? Mr. Hutcheson reported he believed not since the remodeling project was done quite a well ago. Mr. Wilson asked Mr. Campbell if the work would require scaffolding or a crane on the project? Mr. Campbell stated that he would prefer not using scaffolding for the preservation of the building. He would like to see them use a hydraulic hoist. Chairman Steimel declared that it was a necessary project to restore the roof to a safe condition. Ms. Leifheit motioned, seconded by Mr. Wilson to approve the project and forward it to the Public Building Commission. Motion carried unanimously by a voice vote.
FY 2002 BUDGET CALENDAR
Mr. Gary Hanson, Deputy County Administrator distributed copies of the FY 2002 Budget Calendar which is attached with these minutes as Appendage 1, pages 1 and 2. Mr. Hanson reported that the calendar and format remained the same as he has used for several years. Mr. Bockman and Mr. Hanson make recommendations on the budget which is what goes forward unless the committee takes the opportunity to suggest issues that they might want to examine more closely or to appeal recommendations as well. He said there were deadlines however and they need to be aware of those dates. Mr. Steimel asked for questions and commented that it went very smoothly last year. Ms. Dubin asked about concerns of health care costs and wanted to know if it would be better this year. Mr. Bockman reported that concern remains a concern. Mr. Morreale motioned to adopt the FY 2002 Budget Calendar, then seconded by Tige Hoffman. Motion carried unanimously by a voice vote.
FURTHER DISCUSSION:
Mr. Wilson asked if this audit report would be something that could be produced every two years instead of every year to help eliminate costs of producing the report. Mr. Hanson stated that most of the information has to be generated anyway. The expense to put the information into a comprehensible format is not a costly one. Mr. Pritchard asked why do the other 2,700 counties choose not to do such a comprehensive report? Mr. Hanson answered that a lot of them are not doing the background work that this County wants regardless of whether it is put in an audit report or not, such as tracking fixed assets.
The County will be required to do this procedure and track compensated absences so that the County will know what their liabilities are. Furthermore, there are pieces that the County has been adding incrementally over the years to get to this point. Mr. Pritchard asked what the County’s strategy on these fixed assets would be and if there would be policy guidelines. Mr. Hanson stated that yes, he would be bringing a policy to them but are now in the state of becoming educated on the subject. His plan is to not overdue compliance but to meet the minimal compliance. He stated that he thinks the County is in good shape with the information already available. He went on to say that they were figuring out the best way to assemble it. He said the on the Infrastructure, the Highway Department would be their main focus. He further stated that there will be those policy things that the County will ask the Board to pass so that they can show the auditors the basis for County’s rationale on estimating those values. Mr. Hutcheson asked if there is a need to core the roads. Mr. Bockman said that he did not think so. Mr. Bockman stated that we are still getting initiated to this and that the underlying philosophy of this change is that America as a nation has turned it’s back on its infrastructure. He continued by saying that Governments, because it makes them look better financially, do not appropriate enough funds to keep their roads, bridges, and infrastructure in descent condition. It is not only a national tragedy but potentially a national disaster.
ADJOURNMENT
Mr. Hutcheson motioned, seconded by Mr. Wilson to adjourn the meeting at 8:20 p.m. Motion carried unanimously by a voice vote.
_________________________
Roger Steimel
Chairman
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Lisa K. Sanderson
Secretary
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