Rockford Sun

City of Rockford Finance & Personnel Committee met Sept. 23.

Here are the minutes provided by the committee:

I. CALL TO ORDER 

Attendee Name	Organization	Title	Status	Arrived
Kevin Frost	City of Rockford	Alderman	Present
Franklin C. Beach	City of Rockford	Alderman	Absent
Jonathan Logemann	City of Rockford	Alderman	Present
Chad Tuneberg	City of Rockford	Alderman	Present
Aprel Prunty	City of Rockford	Alderman	Present

Other Attendees:

Mayor McNamara

Council Members; T. Durkee, G. Torina, B. Rose, I. Barrios, G. Meeks, J. Bailey. Staff; T. Cagnoni, C. Hagerty, T. Hinkens, S. Leys, S. Hunter, T. Hughes, A. Hammer, T. Monahan, R. Reffett, C. Greenwood, A. Wilkerson, S. Alexander, C. Bailey, J. Rubin, J. Carter, M. Leatherby, S. Capovilla, N. Carter.

Interested Parties and Media

II. INFORMATION ONLY 

A. Financial Discussion - August 2024.

C. Hagerty reported that major revenues year to date are performing on budget. The Replacement Tax, after 5 of 8 payments, is 4% under budget. Sales tax is 6.6% over budget halfway through disbursements. Overall, revenues in the general fund are 8.3% over budget, or $10.9 million. Most statewide revenue sources are only halfway through the year. On the expense side, all operating departments are under budget year to date by about 7.3%. As expected, Police salaries are under budget, while overtime is over budget, with a similar situation in the Fire Department. CIP revenue is 6% over budget in terms of CIP sales tax, and MFT is over budget by 2%. All three revenue sources in the redevelopment fund are over budget, with Hotel/Motel tax at 15% over budget after 8 months.

Durkee expressed concern that the increase in sales tax revenue may not be a good indicator, as it could largely be due to inflation. Durkee noted that the City should also be cautious about other taxes, like hotel taxes, rising due to the increased costs of goods and services caused by inflation.

B. Emergency Repair: Engine/Pumper Unit #1048 to JX Enterprises Inc., of Rockford, Illinois in the amount of $57,020.44. The funding source is the Fire Department Operating Budget.

C. Emergency Repair: Ladder/Aerial Unit #1266 to Interstate Power Systems Inc., of Rockford, Illinois in the amount of $77,407.03. The funding source is the Fire Department Operating Budget.

Prunty asked if the item being discussed was a truck. Frost confirmed that it was a truck that had been damaged.

III. COMMITTEE REPORTS 

A. Approval of Vouchers in the amount of $16,761,411.35.

B. Approval of Parameters Ordinance for Turner School District 2 Police Station Debt Certificate.

Logemann noted that the memorandum states the City is still financing the debt for another 10 years but that it will be paid off after that period. C. Hagerty confirmed this is correct.

Meeks asked if the balance owed for the School could be something that comes out of the Police department’s operating budget. C. Hagerty confirmed that it could and explained that the City is currently paying rent to RLDC, which effectively covers the debt cost, property taxes, and other expenses associated with the facility. These payments are currently coming out of the Police department’s operating budget. Going forward, instead of paying RLDC, the City will make debt payments to a bank, but it will still come from the Police department’s budget.

Prunty stated their understanding that the structure cost about $8.8 million. C. Hagerty clarified that the total project cost was in excess of $9 million, with approximately $8 million in historic tax credit-eligible expenses. The City realized about $3.3 million in savings from those tax credits. Since 2017, the City has paid just under $4 million to RLDC under the agreement, which has effectively been passed through as principal and interest payments. The remaining debt is $5.6 million, which the City is now looking to finance with debt certificates.

Prunty asked what the total potential spend could be after securing a bank with the right financing and interest rate. C. Hagerty explained that the current total is around $9.6 million, not including the upcoming interest expenses. Once the interest rate is determined, the final expense will be shared with Council.

Prunty questioned the benefit of financing this for another 10 years given the City’s surplus of funds. C. Hagerty responded that the City is balancing the stabilization of the general fund with investing in development and infrastructure needs. The 2022 and 2023 surplus plans were designed to help stabilize the general fund and defer future growth in property tax increases. Since the City is already making similar-sized payments from the Police department budget, continuing these payments for another 10 years will extinguish the debt. A 10-year financing period also limits interest exposure compared to a 20-year bond issue.

IV. RESOLUTIONS 

A. Award of RFQ(s): Architectural Services, Mechanical Services, and Appliances for PY2025 Weatherization Services (RFQ No. 824-HS-093, 824-HS094, 824- HS-095) to Total Plumbing, CMM Environmental, Greenlink Energy, and Comfort 1st, all of Rockford, Illinois in the estimated amount of $1,200,000.00 (based on unit pricing). The contract duration is through September 30, 2025 with one (1) possible one-year extension. Price adjustments based on regional market analysis provided by Department of Commerce & Economic Opportunity (DCEO). The funding sources are DCEO, Department of Energy (DOE),

Department of Health and Human Services (HHS), and State Supplemental.

Logemann asked if there was any sense of how many homes the $1.2 million would benefit. C. Greenwood responded that it would benefit 63 homes.

B. Award of Joint Purchase Contract: Pothole Patch Truck from Bergkamp Inc., of Salina, Kansas in the amount of $268,391.00. This is a single purchase item. The funding sources are Capital Lease Funds / Street Division Capital Budget.

Tuneberg asked if there was a ballpark figure for what the City might get for the truck through auction. M. Leatherby responded that it is difficult to estimate, as the current unit is a 2013 model with a significant amount of mileage and is still in service. Leatherby mentioned that it would be a guess at this point but offered to look into comparable units and provide an estimate.

C. Award of Bid: Bulk Lubricants (Bid No. 724-PW-081) to RILCO Lubricants & Services, of Rock Island, Illinois in the estimated annual amount of $40,000.00 (based on unit pricing). The contract duration is one (1) year with four (4) possible one-year extension options. Annual price adjustments for CPI considered at contract renewal only. The funding source is the Equipment Fund Operating Budget.

D. Award of RFP: Vacant and Foreclosing Property Registry (RFP No. 424-CD-057) to OpportunitySpace Inc. dba Tolemi, of Boston, Massachusetts in the annual amount of $15,000.00. The contract duration is one (1) year with four (4) possible one-year extension options. The funding source is the Construction Services Operating Budget.

E. Gaming Tax Revenue Recommendation.

Prunty asked for an explanation of what "high-risk neighborhood economic development" means. T. Cagnoni responded that it is not a defined term but was specifically mentioned in the host community agreement when it was negotiated. The intent is to identify projects outside of the City's high-growth areas and to help advance commercial corridors in other parts of the City.

Prunty also noted that the memo states the funds would be allocated annually and asked if that meant the City plans to give funds on an annual basis. T. Cagnoni confirmed that the intent is for annual funding, with the exception of the International Women's Baseball Museum at Beyer. The museum is moving forward with a plan for a museum and community center, seeking to leverage public and private dollars. The exact number of years for that funding would be determined through negotiations with the museum and City Council. Any items identified in the plan would still require additional approvals by City Council.

Prunty made a motion to amend the resolution item—Gaming Tax Revenue Recommendation—to strike item #8, which allocates $300,000 to the International Women's Baseball Museum at Beyer, and replace it with a provision to support non-profit community centers that no longer operate bingo programs or have lost revenue due to video gaming terminals starting in 2025. The motion failed due to no second.

Tuneberg noted that, as it stands, the International Women's Baseball Museum would receive $300,000, with no stipulations for matching funds. T. Cagnoni clarified that the recommendation would not be "no strings attached" and that it would return to City Council for approval under an agreement with specific performance terms and measurable benchmarks for private fundraising.

Tuneberg also asked for clarification on item #7 regarding arts and culture, stating that it was very broad. T. Cagnoni agreed that arts and culture is broad and explained that the recommendation aligns with the City's ongoing investment and the arts and cultural plan. The City has been engaging the community over the last 12 months to identify additional areas for investment, and the intent is to align these funds with that plan. Specific organizations or projects have not yet been identified, but there could be opportunities to leverage private sector dollars.

Durkee expressed interest in seeing public safety infrastructure addressed and asked if the new agreement with Rockford Promise would include all students from the City. T. Cagnoni confirmed that discussions with Rockford University and the Rockford Promise Board include all graduating high school students who meet GPA requirements from public or private schools within the City, as long as they are MAP or PELL eligible. Homeschool students would not be included. Durkee also expressed concern that Rockford University’s tuition is higher than other schools, and T. Cagnoni explained that the City’s contribution would cover an unlimited number of students, similar to the arrangement with NIU.

Durkee raised concerns about item #7, feeling it was too vague, and also asked about the total cost of the International Women's Baseball Museum project, which is estimated to be over $12 million. Durkee hoped for a "clawback" provision in the contract to retrieve funds if the project isn't completed. T. Cagnoni confirmed that the intent is not to release funds until the project is ready to proceed.

Durkee also asked about improving the sound system at the Coronado Theatre, noting that it is currently incompatible with many musical acts. Tuneberg responded that the RAVE board is aware of the issue and is working on funding to upgrade the system, with an estimated cost of around $425,000.

Rose appreciated the broadness of the "arts and culture" term, stating that it leaves room for innovation and future opportunities.

Prunty asked if it would be possible to vote on some items and not others. Frost suggested that the resolution could be separated for voting next week if needed. T. Cagnoni confirmed that the items can be presented to City Council for individual votes.

Tuneberg noted that the ballpark figure for the Coronado sound system is around $425,000 and that the project is going out for rebid.

Frost mentioned that while the funding is listed as annual, it could change year to year.

Further group discussions ensued.

V. ADJOURNMENT 

The meeting was closed at 6:58 PM

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