City officials say they’ve working toward trimming Evanston’s general fund spending by 2 percent this year — but that’s not nearly enough to cover a projected 5 percent drop in revenue.
Marty Lyons (Chris Kirk photo)
The biggest revenue shortfall, Assistant City Manager Marty Lyons says, is in the real estate transfer tax. It’s expected to yield just $1.2 million this year — only 40 percent of the $3 million budgeted.
The city’s share of state income taxes is expected to be $6 million — 85 percent of the $7.05 million budgeted.
Building permits are expected to raise $3 million — 79 percent of the $3.8 million budgeted.
Lyons told aldermen at a special City Council meeting Wednesday night he also expects the city to come up short about $300,000 on investment income because short-term interest rates have dropped close to zero.
And across all the city’s other revenue sources he sees about a $600,000 shortfall for the fiscal year that began in March.
Lyons said he’s been working with city department heads on the 2 percent budget cut — expected to save $1.8 million. Much of the savings comes from leaving vacant positions unfilled.
For the first three months of the year actual spending totals $19.6 million, Lyons said. That’s 87.5 percent of what would be expected to be spent if spending was level across the year. But spending can vary substantially from month-to-month.
Lyons said the police department may go slightly over budget for the year because of beefed up summer patrols and that seasonal costs in the public works department, like snow removal, are hard to project.
Lyons said the city is also trying to trim training and travel costs and postpone purchases of new computers, office desks and similar equipment.
He outlined six alternatives for closing the remaining budget gap:
- A complete hiring freeze.
- Furlough days for city workers. That could save up to $200,000 for each furlough day.
- Reduced hours of operation, possibly by switching to a four-day work week.
- Program cuts. He noted that staff has already proposed a restructuring of the sanitation operation that could save $400,000 a year. (See related story.)
- Layoffs. That option is somewhat constrained by the no-layoff clause in the city’s contract with AFSCME, one of its four unions.
- A capital spending freeze. Postponing purchases of new fleet vehicles could save up to $1 million.
Aldermen took no action on the additional budget reduction alternatives and seemed inclined to wait until the new city manager starts work Aug. 3 to address those issues.
Planning for next year’s city budget is also scheduled to begin in August.