Committee of the Whole Meeting – Fiscal Year 2026 Village Budget Workshop

October 25, 2025 – 9:00 AM | Oswego Village Hall The Committee of the Whole convened for a budget workshop focused on the Fiscal Year 2026 capital and operating funds. The meeting opened with a roll call and a unanimous vote to allow Trustee Jack Cooper to attend electronically. Following a presentation from the Cultural Arts Commission, the board received detailed budget briefings from staff covering capital funds (Wolf's Crossing, fleet, water/sewer), operating funds, debt service, staffing requests, and the general fund surplus. Key decisions included consensus on a 2% reduction in the property tax levy rate and direction to continue surplus allocation discussions at the next meeting.

Consent Calendar

• Electronic Participation: Approved unanimously (6-0) for Trustee Jack Cooper to attend remotely. (Trustee Cooper participated from Virginia on a work trip.)

Public Comments & Testimony

• No members of the public spoke during the Public Forum.

Discussion Items

Cultural Arts Commission FY 2026 Budget Request

• Presenters: Anthony Pastor (Chair) and Michelle Myers (Commissioner) proposed a flat budget of $16,000, the same as last year.
• Proposed projects:
  • Downtown student art banners ("Look Up As We Go"): $6,000
  • New Lantern Walk (nighttime festival): $4,500 – planned for October 2026, possibly in partnership with the Park District for a farmers market after dark.
  • Utility box painting: $3,500 (pending ownership/permissions from ComEd)
  • Miscellaneous signage: $500
  • Little Free Library program: ongoing, with two new libraries planned for installation next year.
• Trustees expressed strong support, particularly for the Lantern Walk as a potential signature event.
• Staff impact: The new Events Manager and Park District partnership are expected to manage the workload.

Fiscal Year 2026 Budget Workshop – Capital and Operating Funds

(Presented by Andrea, Finance Director, with input from staff.)

Wolf's Crossing / Douglas Road

• Segment 1: Completed. Segment at Harvey Road in progress.
• PDR Update: A planned $750,000 Project Development Report (PDR) for 2026 is no longer required until the Wolf's Crossing at US 30 segment. This saves $750,000 in 2026 (though the funds will be needed later).
• Segment 6 (Roundabout at Fifth Street): Grant application for Highway Safety Improvement Program in 2026; construction possible in 2028.
• Segment 7 (Polo Crossing/Drake): Developer may build southbound lanes using impact fees; agenda item expected November 4, 2025.
• Roth Road: Delayed to 2028 per developer schedule (Sonoma Trails agreement).
• Five-Year Capital Fund Projection: Shows planned use of reserves; $750,000 removal lessens the planned reserve draw.

Fleet Fund

• Revenue: $1.45 million; Expenditures: $1.27 million; Surplus: $178,000.
• Transfers: $1.25 million from capital fund (based on 20-year forecast).
• Vehicles: 12 vehicles totaling $1.1 million, including:
  • 2 building/permit vehicles (compact pickup, compact SUV – new to fleet)
  • 4 police frontline squads (one with custom veteran-themed wrap, $8,000)
  • 5 public works vehicles (forklift, skid steer, forestry truck, two pickups)
  • $26,000 for fuel station engineering at expanded public works facility.
• Inflation: 5% factor used in 20-year projection; costs expected to rise significantly.

Water and Sewer Capital Fund

• Revenue: Over $100 million (including $95 million in WIFIA/GO bonds).
• Expenditures: $87.6 million; surplus is bond revenue to be spent in 2027.
• WIFIA Loan: $70 million expected to close early 2026; federal shutdown may delay but staff has contingency plans (short-term borrowing from general fund, bank lines).
• Projects: 9 projects totaling $87 million in 2026, including Lake Michigan connection, receiving stations, water main replacements, well security, SCADA upgrades, Tuscany Trail water tower rehab.
• Lake Michigan Project: All figures are estimates; final costs will be known after bids close (next bid due Halloween 2025). Water rate discussion planned for spring 2026.
• Sanitary Inspection & Maintenance: $450,000/year – historically flat but will need increases as infrastructure ages.

Unfunded Projects

• List includes Wolf's Crossing at US 30 ($26.97 million estimated, based on 5% inflation to 2029-30), Goodwin Drive, downtown railroad safety improvements (quiet zone – 90/10 grant potential), historic building renovations.
• Priority: Wolf's Crossing at US 30 is the top legislative priority. A $1 million state grant (Representative Benton) is appropriated but not yet released; can be used for construction (not fully for engineering).

Debt Service Fund

• Transfers: $2.3 million from capital fund, $1.3 million from TIF fund (Hudson Crossing increment).
• Total Payments: $3.6 million (increase due to additional parking deck bond and scheduled increase on police facility bonds).
• Standing Debt: Series 2016, 2021 (police facility), 2019 (parking deck 1), 2025 (parking deck 2).

Employee Benefits Fund (New for FY 2026)

• Internal service fund to smooth unpredictable health insurance costs.
• Expenditures: $3.5 million; Revenues: $4.7 million (to establish fund balance).
• Employer/Employee Cost Share: PPO: 80% village / 20% employee; HMO: 95%/5%.

Municipal Parking Fund

• Revenue: $147,000; Expenditures: $121,000.
• Ordinance fines budgeted at $40,000 (up from $8,000 actual in 2024) due to new mobile LPR enforcement; expected to drop to $20,000 in 2027 as compliance improves.
• Fund Balance: Drawn down to ~$35,000 by end of 2026 due to loans for parking deck cameras/counters.

Water and Sewer Operating Fund

• Revenue: $106 million; Expenditures: $105 million (including bond flows).
• Rate Increases (per ordinance): Water volumetric: 4%; Sewer volumetric: 3.8%; Fixed meter charge: 10.7%.
• Reserves: Target 30% of operating expenditures; currently at that level.

Staffing Recommendations for FY 2026

• Investigation Specialist (Police): Civilian (non-sworn) detective – backfill position cut three years ago. Cost less than sworn officer. Expected to hire retired detective. Only Naperville has similar role in the area.
• Social Worker (Police): Full-time in-house social worker to handle mental health calls, officer wellness, and navigate complex service systems. Replaces one-day-a-week Kendall County resource that was overwhelmed. Expected to reduce police response to mental health calls and improve outcomes.
• Utilities Compliance Manager (Public Works): Dedicated position to ensure state/federal regulatory compliance for water and sewer systems, especially post-Lake Michigan connection.
• Net Budget Impact: ~$400,000 ($143,000 from water/sewer fund).

General Fund Overview

• Revenue: $30+ million; Expenditures: $29,149,637; Surplus: ~$1 million (includes full grocery tax revenue).
• Fund Balance: Projected end 2025: $30 million; end 2026: $20.5 million (due to $10.53 million transfer to capital fund for public works facility expansion).
• Target Fund Balance: $8.8 million (30% of subsequent year's operating expenditures); village remains $12 million above target.
• Property Tax Levy: Required police pension contribution increases 17% to $2.2 million. Budget assumes a 2% rate decrease, leaving $272,148 gap covered by general fund.
• Revenue Drivers: Sales tax increasing 19% ($1.625M); income tax up $300K; building permits up $220K; use tax decreasing $770K due to legislative reclassification (benefits village by applying home rule sales tax to reclassified revenue).

Key Outcomes

• Electronic Participation: Approved unanimously for Trustee Cooper.
• Cultural Arts Budget: Presented; no vote (workshop).
• Property Tax Levy: Consensus to reduce the levy rate by 2% (as already included in the budget). The decision is final and will be reflected in the November 18, 2025 vote. (Trustees Novi and Koenig expressed preference for flat levy, but majority supported the reduction.)
• Surplus Allocation (Grocery Tax Revenue): Discussion deferred to November 4, 2025 Committee of the Whole or Staff Reports. Options include water rate credits, capital fund transfer, senior center increase, debt reduction, or holding in reserves. No consensus reached.
• Next Steps: The budget workshop will continue on November 4, 2025, covering remaining general fund department slides and finalizing surplus allocation. The property tax levy ordinance will be voted on November 18, 2025.