An audit of Highland’s finances reported the city is in good financial shape.
Mark Korte, principal with the accounting firm Scheffel Boyle, presented the numbers to the City Council on Monday night.
“The city has taken a proactive approach toward managing future growth of the community,” Korte said.
“When the economy was good about eight years ago, the city acted conservatively and did not spend a lot of money. So they weathered the recession pretty well and they now find themselves in a better position compared to a number of other municipalites in this country (as a result).”
Korte said the city’s net position increased by about $2.4 million in Fiscal Year 2015, which ended April 30.
Korte attributed this increase due to the city undertaking a number of road projects, including the recently completed northeast peripheral route, which was partially funded with federal and state grants.
Net position is a way to evaluate a city and determine whether it is in good financial shape. Banks might use net position when deciding whether it underwrites a bond.
The city’s total assets exceeded liabilities by approximately $69.2 million in Fiscal Year 2015. Total liabilities were $39,996,976 as compared to $40,807,324 the prior year, Korte said.
The audit reported the city had positive fund balances in net position for both governmental and and business-type activities, Korte said.
Receipts of traditional sales taxes increased by about 2.7 percent during Fiscal Year 2015. According to city estimates, the number of retailers has not changed dramatically.
Fiscal Year 2015 was the seventh full year of receipts from the 2006 Non-Home Rule (NHR) Sales Tax Referendum. The 1 percent NHR tax was estimated to bring in an additional $1.3 to $1.5 million annually to the city for street projects. Receipts for the 2015 Fiscal Year equaled $1.4 million, matching the amount collected a year ago.
Building permit activity has begun to rebound and connection fees are also increasing. The growth rate of the city’s equalized assessed valuation (EAV) is an important number in property tax calculations.
In Fiscal Year 2015, the city experienced modest growth of 1.22 percent in revenues from general property taxes as compared to the prior fiscal year. The city collected $3,356,566 in general property tax in the fiscal year.
But several general governmental resources, such as the municipal telecom tax and motor fuel taxes, decreased by modest amounts, according to the audit.
The city, however, collected $2,473,224 in sales tax in Fiscal Year 2015, compared to $2,406,532 the prior fiscal year.
The city’s non-home rule sales tax and Illinois Income tax increased by about $6,000 and $30,000, respectively in Fiscal Year 2015, Korte said.
As of April 2015, the city’s EAV, which is 1/3 of the market value of all property within the city increased by .85 percent percent to a total of $177.8 million.
“This is the first time the city saw an increase in EAV since 2009,” Korte said.
Other City Council News
At its meeting on Monday, the Highland City Council also:
▪ Approved a collective bargaining agreement with the Illinois Fraternal Order of Police Labor Council for the telecommunicators’ bargaining unit. Under the three new contract, the telecommunicators are expected to see a 2 1/2 pay increase this year and 2 1/4 pay hike over the final two years of the contract.
The telecommunicators were planning to meet with the Fraternal Order of Police Labor Council on Wednesday, and are expected to ratify the agreement on Friday.
▪ Accepted City Treasurer Dennis Foehner’s annual report.
▪ Abated property tax levies general obligation sewer bonds and tax increment financing district (TIF) bonds, as well as bonds for the Korte Recreation Center, and street bonds issued in 2014. All these bonds have other revenue sources, such as sales taxes for fees, to pay for them. However, they are ultimately backed by property taxes, if those other sources do not generate enough revenue to pay for them. If there is enough revenue, the city abates the property tax levies.
▪ Approved a $19,651.50 change order for by Insituform Technologies USA for the cured-in-place pipe sewer rehabilitation project.
“While tracking sources of infiltration, our water/sewer maintenance crews discovered sanitary sewers that were allowing storm water to seep in,” Highland Public Works Director Joe Gillespie stated in a Oct. 12 memorandum to City Manager Mark Latham.
“This change order includes the lining of those sewer mains. They are located along the east side of HCS from Woodcrest Drive to the railroad tracks.”