===== PDF PAGE 84 ===== [Extraction: embedded PDF text] CITY OF WEST CHICAGO PUBLIC AFFAIRS COMMITTEE AGENDA ITEM SUMMARY ITEM TITLE: AGENDA ITEM NUMBER: _______7.R.________ Approval of 25-R-0085 A Resolution Updat- ing the City of West Chicago’s Budget Policy COMMITTEE AGENDA DATE: N/A COUNCIL AGENDA DATE: December 15, 2025 STAFF REVIEW: Tia Messino SIGNATURE __________________________ ITEM SUMMARY: As part of the Fiscal Year 2026 budget process, staff conducted a comprehensive review of the City’s Budget Policy. The review focused on clarifying existing provisions, updating outdated lan- guage, and aligning financial practices with current organizational priorities and long-term planning needs. The most substantive update involves revising the allocation of General Fund surplus. Previously, any year-end General Fund balance exceeding the 35% operating reserve threshold was directed solely to the Community Park Fund. Given the increasing emphasis on downtown reinvestment, Council approved reallocating these surplus funds to support the newly established Downtown Revi- talization Fund, while still maintaining planned support for Community Park improvements. The updated policy establishes the following phased allocation schedule, effective upon confirmation of year-end balances through the annual audit: Fiscal Year Downtown Revitalization Fund Community Park Fund 2025 Surplus 100% 0% 2026 Surplus 7.M.80% 20% 2027 Surplus 75% 25% This approach provides early momentum for downtown infrastructure, streetscape, and public-space improvements while gradually rebalancing support between the City’s two major capital priorities. To formally apply the schedule to the 2025 surplus, adoption of this resolution is required. No other substantive changes were made beyond clarification of existing financial practices, refinement of lan- guage, and formatting updates to improve readability. ACTIONS PROPOSED: Approve Resolution 25-R-0085 Updating the City of West Chicago’s Budget Policy COMMITTEE RECOMMENDATION: This item did not go to a Committee. Attachment: Clean Budget Policy; Redlined Budget Policy ===== PDF PAGE 85 ===== [Extraction: embedded PDF text] RESOLUTION NO. 25-R-0085 A RESOLUTION UPDATING THE CITY OF WEST CHICAGO’S BUDGET POLICY BE IT RESOLVED by the City Council of the City of West Chicago, in regular session assembled, that the City’s Budget Policy is hereby updated, in substantially the form attached hereto and incorporated herein as Exhibit “A. APPROVED this 15th day of December 2025. AYES: ________ NAYES: ________ ABSTAIN: ________ ABSENT: ________ ______________________________ Mayor Daniel Bovey ATTEST: _________________________________ Executive Office Manager, Valeria Perez ===== PDF PAGE 86 ===== [Extraction: embedded PDF text] BUDGET PHILOSOPHY AND POLICY Serving the public trust requires that the annual budget provide the best possible balance of allocation to meet the varied needs of all citizens residents and businesses. The budget is a principal management tool for the City administration and, in allocating the City's resources, it both reflects and defines the annual work plan. In this context, tThe budget provides a framework for us to accomplish our achieve the City’s mission, which is: "To assure a safe, cohesive and dynamic community that is responsive to the needs of both citizens residents and businesses as it strives for continuous improvement." The budget It should also reflect important embody organizational values such as integrity, teamwork, service excellence, personal growth, and innovation. In addition to balancing allocations to meet community needs and incorporating our mission and values, aA successful annual budget preparation process requires excellent communications, citizen outreach clear communication, inclusive engagement, and a commitment to excellence. To this end, the process must be a cooperative, transparent, and data driven linking resources to measurable outcomes, community priorities, and strategic goals. West Chicago continues to move toward a forward-looking and progressive approach, emphasizing efficiency, creativity, and responsiveness. Each year’s budget builds on this foundation by identifying opportunities to streamline operations, modernize systems, and improve customer service. Staff are encouraged to challenge the status quo and propose innovative approaches that effort of the entire City organization. West Chicago prides itself on being an increasingly progressive community, willing to challenge the status quo and moving toward the "cutting edge". City staff has accepted this challenge by developing the budget within the context of a search for creative solutions for the delivery of City services. The budget will emphasize policy and procedure reviews to improve the productivity and effectiveness of service delivery to citizens and employees. Teamwork and efficiency enhancements will limit the amount of bureaucratic "red tape" required, both between functional areas within the City, and between City staff and our customers. The overriding goals must be to support the high standards set by the community and to provide long-term value at reasonable cost. The budget will be based upon timely, consistent and clearly articulated policies that incorporate community input. It will be realistic and will include adequate resources to meet assigned work programs. Once adopted, within the parameters of policy guidelines, Department Directors will be given full spending authority for their budget(s). The City’s budget policies of the City are rooted in a history of reflect conservative fiscal management, long-term sustainability, and a balanced approach to growth and investment. budgeting practices. They're based on a commitment to provide quality services while maximizing the return for each dollar spent. Revenue sources are diversified as much as possible to avoid the impacts of fluctuations in a particular revenue source. The following is the Budget Policy the City Council has used may use as a continuing foundation for fiscal discipline: • Revenues are shall be conservatively projected using historical trends, reasonably expected changes in the coming year, and an analysis of anticipated regional, state, and national economic conditions in the region, the state and the nation. ===== PDF PAGE 87 ===== [Extraction: embedded PDF text] • Water, sewer, and other user fees shall be reviewed annually to ensure rates cover the intended share of costs, meet debt obligations, and remain affordable. • The General Fund shall have maintain a fund balance equal to at least 25% of annual revenues; the City should strive to increase this amount to 35% to provide financial stability. • All revenues associated with video gaming revenues shall be deposited into the Community Park Fund. (former Public Benefit Fund). Any fund balance in the • Once the annual audit confirms year-end balances, any General Fund surplus exceeding in excess of 35% shall be allocated according to the following schedule: transferred to the Community Park Fund without the need for any separate Budget Amendment after the completion of the annual Audit once that figure is known. Fiscal Year Downtown Revitalization Fund Community Park Fund 2025 Surplus 100% 0% 2026 Surplus 80% 20% 2027 Surplus 75% 25% • The budget is flexible within each Department. Over expenditures in one line item should be compensated within the Departmental Budget. Each Department may not overspend its total Departmental Budget without prior approval. Department Directors may not exceed the staffing levels approved in the Budget. The City Administrator may authorize transfers within a fund. • Major capital expenditures not related to either the water or sewer utilities for the next five years will be identified in the Capital Projects Fund Budget. This Budget will be updated on an annual basis. Smaller capital purchases may be included in each Department's operating budget. • User fees, such as water and sewer charges, will be reviewed annually. This is done to ensure that fees cover costs, if intended to do so, meet debt service requirements, and are affordable. • Implementation of the Budget will be monitored continuously. Purchase orders will be issued only when adequate funding is available. Based upon experience with higher prices via the bidding process and after receiving direction from the City Council, information technology equipment purchases and maintenance contracts do not have to be bid, so long as multiple written quotes are obtained to show that the price is reasonable or else it is a justified sole source purchase. • All home rule sales tax receipts and taxes from the consumption of natural gas shall be deposited in the Capital Projects Fund. ===== PDF PAGE 88 ===== [Extraction: embedded PDF text] BUDGET PHILOSOPHY AND POLICY Serving the public trust requires that the annual budget provide the best possible balance of allocation to meet the varied needs of residents and businesses. The budget is a principal management tool for City administration and, in allocating the City's resources, it both reflects and defines the annual work plan. The budget provides a framework : "To assure a safe, cohesive and dynamic community that is responsive to the needs of both residents and businesses as it strives for continuous improvement." It should also embody organizational values such as integrity, teamwork, service excellence, personal growth, and innovation. A successful budget process requires clear communication, inclusive engagement, and a commitment to excellence. The process must be cooperative, transparent, and data-driven linking resources to measurable outcomes, community priorities, and strategic goals. West Chicago continues to move toward a forward-looking and progressive approach, foundation by identifying opportunities to streamline operations, modernize systems, and improve customer service. Staff are encouraged to challenge the status quo and propose innovative approaches that provide long-term value at reasonable cost. The budget will be based upon timely, consistent and clearly articulated policies that incorporate community input. It will be realistic and will include adequate resources to meet assigned work programs. Once adopted, within the parameters of policy guidelines, Department Directors will be given full spending authority for their budget(s). The budget policies reflect conservative fiscal management, long-term sustainability, and a balanced approach to growth and investment. Revenue sources are diversified as much as possible to avoid the impacts of fluctuations in a particular revenue source. The following is the Budget Policy the City Council may use as a continuing foundation for fiscal discipline: Revenues shall be conservatively projected based on historical trends, known changes in the upcoming year, and analysis of regional, state, and national economic conditions. Water, sewer, and other user fees shall be reviewed annually to ensure rates cover the intended share of costs, meet debt obligations, and remain affordable. The General Fund shall maintain a fund balance equal to at least 25% of annual revenues; the City should strive to increase this amount to 35% to provide financial stability. All video gaming revenues shall be deposited into the Community Park Fund. vii ===== PDF PAGE 89 ===== [Extraction: embedded PDF text] Once the annual audit confirms year-end balances, any General Fund surplus exceeding 35% shall be allocated according to the following schedule: Fiscal Year Downtown Revitalization Fund Community Park Fund 2025 Surplus 100% 0% 2026 Surplus 80% 20% 2027 Surplus 75% 25% The budget is flexible within each Department. Over expenditures in one line item should be compensated within the Departmental Budget. Each Department may not overspend its total Departmental Budget without prior approval. Department Directors may not exceed the staffing levels approved in the Budget. The City Administrator may authorize transfers within a fund. Major capital expenditures not related to either the water or sewer utilities for the next five years will be identified in the Capital Projects Fund Budget. This Budget will be updated on an annual basis. Smaller capital purchases may be included in each D Implementation of the Budget shall be monitored continuously. Purchase orders will be issued only when adequate funding is available. Based upon experience with higher prices via the bidding process and after receiving direction from the City Council, information technology equipment purchases and maintenance contracts do not have to be bid, so long as multiple written quotes are obtained to show that the price is reasonable or else it is a justified sole source purchase. All home rule sales tax receipts and taxes from the consumption of natural gas shall be deposited in the Capital Projects Fund. viii