small overage that the Board had agreed to give to the PSAPs. Executive Director Zerwin
responded that Vice Chair Franz might be confusing the IGA with the separate policy governing
where additional money beyond the $1 million already budgeted would come from.
Vice Chair Franz then asked whether interest income, reimbursements, sale of assets, and similar
items were also being treated as available revenue. Executive Director Zerwin explained that
reimbursements were essentially budget neutral because ETSB first paid costs for optional or
additional contract items, such as Mobile Responder, INET Viewer, and RMS maintenance, and
was reimbursed in arrears by participating agencies, groups, or consortiums. She stated that,
although those reimbursements appeared as revenue on the report, they were not truly additional
income because ETSB had already spent the funds and was simply recovering them. Vice Chair
Franz commented that those reimbursements were essentially a wash.
Member Honig stated that, from an accountant’s perspective, the treatment described by
Executive Director Zerwin was the correct way to present the reimbursements because it would
be an auditor’s nightmare to handle them differently. He noted that the format appropriately
showed how those amounts moved throughout the year and that, while it might look unusual at
first glance, it correctly reflected the underlying accounting principle. He added that, if the
reimbursement structure changed significantly in future years, the Board could revisit the issue,
but he believed the current presentation was the correct approach. Executive Director Zerwin
responded that County Finance had two CPAs assigned to ETSB and that much of the reporting
format was based on their guidance and designed to make year-end reconciliation and audit
preparation easier.
Vice Chair Franz stated that he wanted the Board to spend more time determining what reserve
balance should be maintained for capital so that ETSB did not end up in a situation similar to the
Water Commission, which had drawn controversy after sitting on too much cash. He noted that,
with the radio purchases largely behind the Board, the capital picture was now clearer, and
questioned whether the capital plan needed to be fully funded each year or whether the Board
should instead establish a reserve target and true it up annually.
Member Eckhoff noted that he had discussed the issue with Executive Director Zerwin the
previous day and explained that, based on his experience on a city council and the County Board,
reserves were typically viewed as a percentage of expenditures, with 25 to 30 percent being a
common benchmark. He stated that the Board should not view the entire $38M as already sitting
in a contingency fund, because that was not how he understood the fund should be analyzed. He
explained that he preferred a format showing the actual amount currently in contingency, what
the target should be, and how much should be contributed each year over time, similar to funding
a sinking fund for a long-term replacement. Member Eckhoff stated that the prior format made it
appear that everything was in one account and therefore overfunded. He also noted that ETSB
had fewer revenue options than municipalities or the County because it relied heavily on the
State surcharge and therefore needed to remain conservative, especially given the uncertainty
around possible surcharge changes in Springfield and noted that, for that reason, he had asked
Executive Director Zerwin to prepare a simpler, single page report showing expenditures,
revenue, contingency trends, and overall financial direction. At 9:52 am, Member Eckhoff
excused himself and left the room.
Vice Chair Franz agreed with Member Eckhoff stating that he believed a reserve equal to 50
percent of capital need, trued up annually, might make sense, but that he did not think the Board
