City Manager Luke Stowe unveiled a proposed 2023 Evanston city budget Monday afternoon that calls for a 4% increase in property taxes and a nearly 12% jump in total city spending.
City staff estimate the property tax increase will add $64 to the city’s share of the tax bill for a home with an assessed valuation of $300,000.
Much of the increase in total spending is the result of capital improvement projects at the city’s water plant that Deputy City Manager Dave Stoneback says are expected to be paid for by revenue from the other communities that Evanston sells water to, rather than by Evanston residents.
The city’s property tax levy has increased nearly 25% over the past six years — although it was held steady in the 2022 city budget.
Stowe said, “We do have a couple of council members that are interested” in having no property tax increase for 2023, but “others are more interested in providing some additional programs and services.”
“We put forward this draft budget, and will continue to seek feedback from the council and the community,” he added.
The city’s chief financial officer, Hitesh Desai, said the city has built up substantial surpluses in several funds and will be deficit budgeting in those funds next year to bring down those balances.
Of the $402 million in projected spending, only $371 million is expected to be covered by 2023 revenue — meaning the city would spend about $31 million from reserves in various funds.
But Desai says the budget turmoil during the pandemic has led officials to conclude that the city’s current policy of maintaining a two-month reserve in the general fund — or 16.67% of projected annual spending — is not quite sufficient.
So the budget proposes starting a three-year process of raising the general fund reserve level to 20% by 2025 by taking it to 18% next year.
City revenues have been increasing this year — but Desai says that’s largely a result of high inflation rates, which will also increase the city’s costs going forward.
The budget calls for a 4.5% across-the-board wage increase for non-union employees. The city is also negotiating new contracts with its four employee unions to replace agreements that expire at the end of this year.
The budget calls for adding 22.5 new and restored positions to the general fund, including seven new firefighter/paramedics to allow full staffing of the city’s third ambulance.
While the city plans to work to fill 27 open positions in the Police Department, Stowe says the budget does not call for restoring another dozen police jobs that were cut from the budget in the Spring of 2020.
The City Council is scheduled to have its first discussion of the budget during a special meeting on Monday, Oct. 17.
Various public hearings and community meetings will follow, with the Council scheduled to approve a final budget before Thanksgiving.