Trustee Turner explained our current Village Code pertaining to daily construction activities start/finish times. She also stated that the variance is necessary so Wal-Mart can finish on time. Trustee Turner then made a motion to approve the variance, provided that all of the work would be done indoors so as not to disturb anyone living around the site. Trustee Larson seconded the motion.

Trustee Caulfield asked how the variance would be enforced and what process would be used to withdraw the variance if necessary. Trustee Porch agreed and asked how it would be handled if it became a nuisance. Trustee Larson stated that the police monitor construction sites.

Trustee Hanson stated that the letter stated that the request for the variance was to do inside work.

Trustee Porch asked what prevents other requests for variances being made. Attorney Long stated that anyone can request a variance, but that it is generally only granted for unique hardships. He stated that in most construction projects there is not a factor to consider that would cause any hardships.

On roll call, the vote was:
YES: 5: Larson, Caulfield, Hanson and Turner
NO: 1: Porch
ABSENT: 1: Pierce
THE MOTION CARRIED

Trustee Larson asked why there are two checks to Antioch Electric for the same amount. Finance Director Steele explained that if you look at the report, that one shows as a payable and one as a receivable.

Trustee Larson asked why the payment to Daniels, Long and Pinsel is broken into two payments. Administrator Probst explained that the payment comes from the General fund and the Water and Sewer fund. Trustee Larson asked if it would be the same format in the future. Director Steele responded that it would.

Trustee Larson asked what Office Team is and if it is for the temp. Administrator Probst stated she is correct, that it is the temp for Planning, Zoning and Building.

On roll call, the vote was:
YES: 5: Larson, Caulfield, Porch, Hanson and Turner
NO: 0
ABSENT: 1: Pierce
THE MOTION CARRIED

Manual Checks – Trustee Caulfield made a motion to approve manual checks written to date for the water and sewer account in the amount of $22,645.38, the payroll account in the amount of $11,747.73 the Dolly Spiering fund in the amount of $1,752.47 and the general account in the amount of $227,248.93. Trustee Porch seconded the motion.

Trustee Larson asked why Mike Gliniewicz was being paid to paint the Fire Department/Rescue Squad building. Director Steele stated that he has a separate business, which won the bid for the exterior painting. Director Steele also stated that Mr. Gliniewicz took vacation time from the Village to perform the service.

On roll call, the vote was:
YES: 4: Caulfield, Porch, Hanson and Turner
NO: 0
PASS: 1: Larson
ABSENT: 1: Pierce
THE MOTION CARRIED

Invoices over $10,000 – Trustee Caulfield made a motion to authorize an invoice for Illinois EPA, in the amount of $17,500.00 for the Treatment Plant Annual Permit Fee. Trustee Turner seconded the motion.

Trustee Caulfield asked how much the permit was last time. Director Steele stated she could check into it. Attorney Long stated he believes it is based on capacity.

On roll call, the vote was:
YES: 5: Larson, Caulfield, Porch, Hanson and Turner
NO: 0
ABSENT: 1: Pierce
THE MOTION CARRIED

Trustee Caulfield made a motion to authorize an invoice for Lake County Metropolitan Enforcement Group, in the amount of $10,800.00 for the 2004-2005 Assessment. Trustee Hanson seconded the motion. On roll call, the vote was:

YES: 5: Larson, Caulfield, Porch, Hanson and Turner
NO: 0
ABSENT: 1: Pierce
THE MOTION CARRIED

Trustee Caulfield made a motion to authorize an invoice for Claire Horton, in the amount of $10,600.00 for the Final Payment for the Police Department Property. Trustee Larson seconded the motion.

Trustee Caulfield asked Director Steele to address her concerns with this payment. Director Steele stated she was concerned because of the lack of paper work and that she recommends this payment is held until proper paperwork is provided.

Attorney Long stated that it would also be a good idea to wait to verify if there are any existing liens against the property. He also stated that a release might be needed.

Trustee Larson withdrew her second and Trustee Caulfield withdrew his motion.

Escrow Invoices – Trustee Caulfield mentioned that the escrow invoices are informational.

Antioch Senior Center and the Dolly Spiering Fund – Trustee Caulfield stated that there is a request for a CD that matured on July 1, 2004. Trustee Caulfield made a motion to approve the Senior Council’s request and to direct staff to initiate the request. Trustee Hanson seconded the motion.

Trustee Caulfield asked Director Steele to explain the information included in the packet regarding the above made motion.

Director Steele explained, that based on Resolution 03-16, Village Staff has to work at the direction of the Senior Council. She stated that currently, staff has been signing off on items that the Senior Council should be signing off on.

Director Steele explained that the second piece of paper was the request from the Senior Council stating how they would like to invest their money. She stated that this request had been discussed at the previous finance committee meeting.

Trustee Larson stated that the Senior Council was not sure if this format was still applicable since payouts will need to be made to the construction company. Director Steele stated the construction company should not be billing until the work is done and that the payoff will follow the performance of the company.

On roll call, the vote was:
YES: 5: Larson, Caulfield, Porch, Hanson and Turner
NO: 0
ABSENT: 1: Pierce
THE MOTION CARRIED

Request for Additional Funds for Financial Analysis – Trustee Caulfield stated that there is a letter in the agenda packets describing the amount of the request as well as some background information. He also stated that the fact that they are in this situation again frustrates him and that this has been a long struggle to get where we are today. Professionals were hired to review the financial situation, policies and procedures and this Board choose not to follow the recommendation of the study. Trustee Caulfield likened the approach to hauling gravel in VW Bug rather than a dump truck and having to spend enough money to have been able to purchase multiple dump trucks. He then asked Director Steele to take over.

Director Steele asked Joel Manning, of Manning Silverman, to discuss the background causing this request.

Mayor Maravelas stated before Mr. Manning spoke, he wanted to verify that she found another bank account at Bank One. Director Steele stated she found an account, but she is not sure yet if it is with Bank One. She stated that the account has over $26,000.00 and that it has not been included in any of the account.

Director Steele also stated that she found records on her computer regarding accounts that date back to 1998/1999. Trustee Larson asked how much money are in the accounts. Director Steele stated she would have to check into it.

Trustee Larson then asked about the $26,000.00 and Director Steele stated she would have to check with the bank to find out who the signers on the account are and the tax id for the account. Trustee Larson asked her to get back to the Trustees with that information.

Mr. Manning stated that he would have Stephanie provide information as well. He started by saying that he is going to try to go line by line to explain what they are finding. He stated that when they are trying to trace back to the beginning of the year, they get stopped because they can’t go beyond April 30, 2003. He stated that there are several problems that they do not know how to handle. Some of those items are:

• The Village, prior to May 1, 2003, has double billed the Fire Department for FICA. He stated that they haven’t traced if further than May 1, 2003 but that some one will need to and to rectify the issue.

Attorney Long asked if it is the individual firefighters that have been double billed. Stephanie Zaher, of Manning Silverman, stated that the Fire Department has to reimburse the Village and they have been double billing.

• Items in accounting do not show up in bank accounts and also items in the bank accounts are never showing in the accounting. He said these amounts are in the hundred of thousands of dollars.

Mayor Maravelas asked if it was a certain bank that this was occurring with. Ms. Zaher stated that in the enterprise fund there is an amount of $145,000.00 that they can’t look into, since they can’t go beyond May 1, 2003 and they can’t find anything in the bank statements that they have that matches the amount.

Mr. Manning stated that they are trying to find these answers and after hours of chasing the information they hit the wall of May 1, 2003. He stated that after all that time is spent, they can’t go any further.

• Software is necessary to handle the work that is being done. Mr. Manning stated that the software could have been purchased two times over with all of money that has been spent so far.

• Procedures have not been implemented and there is no cross training between any of the employees. Two employees were out for illness and no one could answer any questions, because no one else knew how to perform the work.

• As a whole, the temps didn’t know everything that was needed to close the month for the Village. This wasn’t realized until the Manning Silverman started digging into the accounting and then realized what the temps didn’t know how to do.

• A temp and the computer consultant made journal entries that neither Director Steele nor Manning Silverman were aware of. Director Steele and Manning Silverman had agreed not to make any journal entries, but the temp and the computer consultant made them.

• Manning Silverman had to take time to train the temps.

• Computer consultant understands the system and records transactions the way she thinks they are going to happen and when trying to reconcile the transactions they have to search through the bank accounts to find the transactions

• General ledger balance is out of balance, as of April 30, 2003 almost $3,000,000.00 and they can’t find why, since they can’t look beyond May 1, 2003.

• Summaries of work are required and that can take 30 to 45 minutes per day.

Mayor Maravelas asked what is needed to fix the problem. Mr. Manning stated that an accounting system that works.

Mayor Maravelas stated that they had been given a deadline of June 30, 2004. Mr. Manning stated that they tried and that they are very close to finalizing everything.

Mayor Maravelas asked Director Steele how much longer they need. Director Steele stated that she is relying on their professional opinion. She also stated that they need them to finish.

Mayor Maravelas asked Mr. Manning how much more time they need. Mr. Manning said that Ms. Zaher needs about 10 days, that another employee needs about 7 days and the he needs about 3 days to review.

Trustee Caulfield stated that Mr. Manning said that considerable time has been invested in researching items and then hitting the wall of May 1, 2003. He stated that something needs to change, that they should not look for those items or should look past May 1, 2003. Mr. Manning stated he would say “Yes”, but the Board said “No”, so he is respecting the Board’s decision.

Trustee Caulfield stated that in respecting the Board, what will happen with the audit. Mr. Manning stated that, in his opinion, a clean bill of health cannot be given.

Director Steele stated that when the independent auditors come in, they will look at the work Manning Silverman has done and they will also look at the beginning balance and they will talk with the pervious auditors. She stated that when they talk with the previous auditors, hopefully with better communication than has been had to this date, they will be able to evaluate the numbers.

Trustee Hanson asked if researching before April 30, 2003 would be included in the cost provided to finish their work. Director Steele stated that is a whole different story. Mr. Manning stated they have no idea how many years it goes back. He also stated that the person that did the audit is no longer with the company so Manning Silverman could not get answers to some of the questions needed. Director Steele stated that the other auditor should be given the work papers from the audit and that she hopes that previous auditing firm will work better with a new auditor than they have with the Village and Manning Silverman.

Trustee Larson stated that the Village Administrator was asked to do cross training and procedures almost a year ago, but that he wanted to wait until a finance director was hired. Mr. Manning stated that after talking to Village Staff, that the concern is that they are short staffed and the cross training will be to difficult.

Trustee Larson stated that the problem was also that temporary staff is being used and that goals need to be established to ensure that the Village is not in the same situation a year from now. Director Steele stated she agrees and is working on it.

Trustee Caulfield asked how professionals can be brought in when there is no one to lead them. He stated that turnover is not the issue, that the issues are that there were not procedures, a computer system or qualified people. He also stated that the Board asked for temps and that’s what the Board got.

Trustee Hanson stated that there was no point in pointing fingers, since we are where we are. He stated that the Board has attempted to do what was right, but more complex issues are being found. He stated that the decision needs to be made to create a comprehensive plan rather than continuing to do it piece mail. If not, it could be another two months and this same conversation will be occurring.

Mr. Manning stated that what Director Steele wants is to get the accounting done so that an audit can be done. He stated that the software and the temporary people are not the solution. He also stated that having his firm do the day-to-day work is not the solution either.

Trustee Porch stated that bank reconciliations were being done and asked how many have been done. Ms. Zaher stated that they are finishing up one. Ms. Zaher also stated that $216,000.00 was not recorded in the books, but is in a deposit. She also stated that it’s not just the bank reconciliation that need be completed; there are also journal entries.

Mr. Manning stated that when the final bank reconciliation is done, they will know where all the money is – or what money they can’t find.

Trustee Porch stated that earlier it had been mentioned that the computer consultant was making journal entries. Director Steele stated that she has a long-standing relationship and that past auditors had instructed her to do so.

Mayor Maravelas stated that a lot of money has been invested and that they should be allowed to finish the work they have started.

Trustee Caulfield asked what their final product will look like when they are finished, if it will be signed and sealed and ready for the auditors. Mr. Manning said it will be a bound copy, with multiple sets. Trustee Caulfield asked if it would address all of the issues that they have not been able to address. Mr. Manning stated that is their plan.

Trustee Turner asked how many items are open ended, if it is a lot of items. Ms. Zaher stated that it is. Mr. Manning stated that, he thinks, that an outside audit firm is going to think that the dollar amount unaccounted for is too large.

Trustee Turner asked if legally the Village can require the previous auditor to provide the information.

Director Steele stated that the request for proposal for the new auditor states that they must share the work papers with the Village.

Attorney Long asked if it would be enough to see the work papers, or would they need the former employee? Mr. Manning stated that it depends on the quality of the work papers.

Trustee Larson stated that the beginning balance must have come from somewhere. Mr. Manning stated that it could have been that the numbers matched at one time.

Trustee Turner stated that she previously stated she wouldn’t allocate more money, but that this needs to happen. Trustee Turner made a motion to allocate additional funds; Trustee Porch seconded the motion. On roll call, the vote was:

YES: 5: Larson, Caulfield, Porch, Hanson and Turner
NO: 0
ABSENT: 1: Pierce
THE MOTION CARRIED

Mayor Maravelas thanked the Board for approving the additional money to finish what was started.

Trustee Porch suggested purchasing Quick Books to handle the Village finances. Director Steele explained that the Village is using Quick Books and that she is looking into new software.

YES: 5: Larson, Caulfield, Porch, Hanson and Turner
NO: 0
ABSENT: 1: Pierce
THE MOTION CARRIED

Park Rental – Trustee Larson made a motion to approve a park rental alcohol request for Debi Duros at Centennial Park on July 10, 2004 and Jamie Gaa for Pedersen Park on July 18, 2004. Trustee Hanson seconded the motion. On roll call, the vote was:

YES: 5: Larson, Caulfield, Porch, Hanson and Turner
NO: 0
ABSENT: 1: Pierce
THE MOTION CARRIED

Liquor License – Trustee Larson made a motion to issue a liquor license to the Antioch Chamber of Commerce’s “Taste of Summer” for July 22, 2004 through July 25, 2004, waiving fee. Trustee Hanson seconded the motion. On roll call, the vote was:

YES: 4: Larson, Caulfield, Hanson and Turner
PASS: 1: Porch
ABSENT: 1: Pierce
THE MOTION CARRIED

Other Business – Administrator Probst stated that the letters on the Diaz were due to a request from Trustee Pierce.

Respectfully submitted,

_________________________

Amy S. Monroe, Village Clerk