On Tuesday, December 1, 2009 the Village Council adopted the 2010 Municipal Budget (FY10 Budget), including the Community Investment Program. The FY10 Budget features a variety of expense reductions and certain revenue enhancements to address the challenging economic conditions exacerbated by the recession. The deliberate and open process used for budget discussions occurred over the course of seven meetings with unprecedented levels of public input. The budget calls for changes in the Village’s business model and in many cases, is far from business-as-usual; a fact underscored by $2.5 million in expense reductions in the General Fund, the Village’s main operating fund.
Prior to the proposed budget being discussed, the Village Council and staff participated in a series of six publicly held sessions to forge a Long Range Financial Plan (LRFP). The thorough analysis of the Village’s financial condition conducted during these sessions revealed a $4.5 million structural gap in the General Fund due to declining revenues and increasing operational and capital expenses. Ultimately, the following strategies as identified in the LRFP played a key role in addressing the financial challenges facing the Village:
- Implement Operating Efficiencies
- Enhance the Revenue Base
- Reduce/Eliminate Services, Events & Programs
- Increase/Enhance Property Tax Revenue
- Increase/Enhance Other Revenue Sources
- Reduce Personnel Expenses
- Strategically Use Reserves
The FY10 Budget reflects the strategies outlined in the LRFP in the following manner:
- $2.6 million expense reduction in the General Fund
- Increase the Real Estate Tax Levy for General Fund operations
- $1 million increase in operating revenue via increase in Home Rule Sales Tax of .25%
- $834,000 use of cash reserves
Expense reduction efforts play a significant role in the FY10 Budget and include a series of cost saving measures and operating efficiencies across all departments. Consistent with the LRFP , the following reductions are sustainable over the long term and although many are the result of operating efficiencies with no direct service impact, there are those that will reduce service levels. The table below outlines these changes.
|Action||LRFP Strategy||Cost Savings|
|Improvements to Vehicle Fleet Management||Operating Efficiencies||$400,000|
|Changes to the Health Insurance Plan||Reduce Personnel Expenses||$450,000|
|Elimination of Full and Part Time Positions (25.65 Full Time Equivalent)||Operating Efficiencies, Reduce Personnel Expenses & Reduce/Eliminate Services, Programs and Events||$1,023,000|
|Suspend 2010 Heritage Festival||Reduce/Eliminate Services, Programs and Events||$494,000|
|Eliminate Pro Criterion Bike Race||Reduce/Eliminate Services, Programs and Events||$37,000|
|Elimination of the Ice Sculpture Festival||Reduce/Eliminate Services, Programs and Events||$23,000|
|Modification of the Taxi Subsidy Program||Reduce/Eliminate Services, Programs and Events||$50,000|
|Suspension of the Community Grants Program||Reduce/Eliminate Services, Programs and Events||$72,000|
|Elimination of the DuPage Senior Citizen Grant||Reduce/Eliminate Services, Programs and Events||$39,000|
|Total Cost Savings||.||$2,595,000|
As recommended in the LRFP , the adopted budget includes an increase in the Real Estate Tax Levy that will be used for the provision of services ($500,000) and the cost of pensions ($845,000). The $1.3 million increase in the Real Estate Tax Levy for core services would add approximately $48 to the annual property tax bill for a property with a market value of $300,000 and a resulting taxable value (Equalized Assessed Valuation) of $100,000. The Village Tax rate for FY10 will be .4898.
Additional elements of interest in the adopted FY10 Budget include:
- An increase in the Home Rule Sales Tax rate from .75% to 1.0% to generate an additional $1.0 million of revenue in a six-month period (July 1 to December 31).
- The elimination of the annual operating deficit in the Transportation Fund
- Funding for the 2010 Strategic Plan action agenda items.
- The incorporation of the Long Range Financial Plan recommendations.