Island Lake officials fight over fund transfer
The Island Lake village board gave the town’s finance director permission to transfer up to $300,000 from a special water fund to the town’s general coffers Thursday night, but not without a fight.
Finance Director John Little had requested the money because the village has mounting bills and revenue isn’t keeping up, he said. Late payments from the state, a lawsuit, recent retirements and other unexpected expenses are driving the village into the red, Little said.
Little said he wanted the ability to borrow money from a dedicated water fund, which is supposed to pay for water-related projects, in case such a temporary transfer is needed. It’s not needed now, Little said, and he did not know if it is going to be in the future.
“It’s just in case,” Little told the board.
The item appeared on the agenda for Thursday night’s board meeting without any prior public discussion, however, which didn’t sit well with some trustees. The description of the item on the agenda didn’t include a maximum amount for such a loan, which also rubbed some trustees the wrong way.
Trustees eventually put a $300,000 cap on the loan, if it’s needed, and approved the plan 4-2. Trustees Don Saville and John Ponio voted against the plan, while Mayor Debbie Herrmann voted in favor of it.
Trustee Laurie Rabattini was absent.
The vote came only after Saville and Ponio disagreed with the way the proposal was brought to the board. They also questioned if the loan should be approved now if the money isn’t needed right now.
Saville also questioned how the village would be able to pay back the loan if it doesn’t have the money it needs now.
Borrowing from the water fund is legal, village attorney Julie Tappendorf said. The money would have to be paid back by the end of the fiscal year in which the transfer occurs.
If the money is borrowed this month, it must be returned by April 30, she explained. Borrowing the money after May 1 would give the village until April 30, 2012, to pay it back.
Saville proposed waiting to approve a loan until an actual emergency arises. A special board meeting could be called, he said, and the board could vote to give Little whatever money the town needs.
Herrmann countered by saying a special meeting would cost the village $900 — a total that includes the fees board members are paid for attending meetings, as well as legal representation at meetings.
Saville offered to give up his fee if a special meeting is needed and requested the other board members and mayor do likewise. The suggestion was ignored.
After first suggesting Little and the board simply wait until the budget discussions for the next fiscal year to review the matter, Ponio verbally attacked Little.
“You want open access to an account for money you don’t need, or at least that you’re not telling us you need, because everything is done in the dark around here,” Ponio said. “You may already have that money earmarked for something, but you’re not telling the board about it, because that’s how things go around here.”
Herrmann eventually silenced Ponio, the discussion continued and the vote was taken.