“Bottom line is, we have too much debt,” City Manager Wally Bobkiewicz told aldermen at Monday night’s special City Council meeting.

Debt ratios for the 19 Cook County towns included in the city’s study of 35 metro-area communities.

“Bottom line is, we have too much debt,” City Manager Wally Bobkiewicz told aldermen at Monday night’s special City Council meeting.

Debt ratios for the 19 Cook County towns included in the city’s study of 35 metro-area communities.

A chart staff distributed to the aldermen showed that Evanston has the second highest ratio of municipal debt to property values among 35 metro area communities checked. Evanston’s 9.47 percent ratio was only topped by the 14.62 percent ratio in Cicero. The average for all the towns was 3.88 percent.

The city, Bobkiewicz says, has $101 million in debt that’s directly paid through property taxes. That’s $11 million over the $90 million set by the City Council’s own policy. Add in other debt that’s guaranteed by water and sewer charges and other revenue sources, and the debt totals out at more than $278 million.

“Regardless of who pays it back. we have too much debt,” he added.

Bobkiewicz and Administrative Services Director Joellen Earl said the survey numbers may be misleading because they are based on total debt rather than property-tax-supported debt only.

Bobkiewicz said city staffers will pull out the 10 most comparable cities from the list and break their debt down further so council “can compare apples to apples” and see where Evanston really stands.

Alderman Coleen Burrus, 9th Ward, who originally asked for the survey, called the financial situation “a huge problem” and said officials should be looking at debt as a whole, not just in parts.

“What was frustrating is that they weren’t just coming out and saying it’s all debt,” Burrus said. “Even though some is coming out of the taxpayer, some is coming out of other funds, it’s still debt that we have and we have to pay back.”

Both Bobkiewicz and Burrus said the debt level will most likely affect how council handles next budget season.

“On the capital side, we have to spend less money and that’s going to be hard on the community,” Bobkiewicz said. “The community looks to the city for a variety of improvements every year, in parks, in streets, that I think we’re going to see fewer of as we move forward.”

Join the Conversation

5 Comments

  1. What is the TOTAL debt ??

    The City of Evanston needs to consider its total debt when reviewing its financial situation. This includes current outstanding debt, PLUS off balance sheet "debt" i.e. Unfunded pension liabilities. Are there other off balance sheet liabilities lurking in the closet in Evanston ?

    As a resident of Evanston, I am exposed to "debt" at the City level, the County level, the State level and the Federal level. Has anyone looked at the total debt picture? Not a good situation for us, and even a worse situation for our children and grandchildren. This "total debt load" will suffocate our children and grandchildren and leave them burdened for the rest of their lives. Think of putting a 100 pound sack of flour on your back and being asked to carry it for the rest of your life. It will slow you down, tire you out – this is what we are doing to our children and grandchildren.

    So you think we’ll grow our way out of it ? Look around – Jobs are difficult to find, income growth is growing at a lower than historical rate due to global competition. The U.S. is a mature economy.

    Sounds like it’s time for everyone to tighten their belts. Sad, but true.

    Just look at what is happening in Greece, Spain, Italy, France, England, and Japan. Our situation is much closer to those countries than people believe.

     

    1. Greece and Japan and England

      Just look at what is happening in Greece, Spain, Italy, France, England, and Japan. Our situation is much closer to those countries than people believe.

       

      Which one, Greece or Japan?  

      Don’t you realize that the two situations are different?

       

      Greece had wasteful spending, bogus budgets ,  unsustainable benefits   , and lax tax collection even during the good economic times.

      Japan made the mistake of not following the advice of Keynes and Krugman…instead of spending their way out of a recession, they failed to have a nice stimulus.  As Paul Krugman writes:

       

       " And with each passing month we drift closer to a Japanese-style deflationary trap."

       

      As for England, Thatcher tried to cut spending during a recession back in 1979…and unemployment shot up to around 20%.   If the Falkland Island war hadn’t saved her, she would have been thrown out of office much sooner…and we would all be better off.

       

      Obama’s stimulus, while well intentioned, wasn’t big enough.  That is the problem.

       

      1. Obama’s Stimulus wasn’t big enough?!!!

        Obama’s Stimulus wasn’t big enough?  Outstanding!

        I think I understand your logic.  If the prescription does not cure the disease, the answer is to administer more of the same medicine!

        This recession is akin to a heroin addict suffering from withdrawal symptoms after he runs out of junk.  It is a painful process, but a necessary one to cure the patient of his addiction and ultimately save his life.  In our country’s case, the drug was excessive credit and reckless spending made possibly by overaccomodative Fed funds rates, irresponsible lenders and borrowers, and misguided government policy.  Now the drug has been taken away and we are all suffering from the withdrawal symptoms as our economy struggles to find a new way to function.  We will continue to struggle until we find a way to add value to the world other than building houses and flipping them for profit.

        But your solution, and that of the Keynesians, seems to be to have the Government administer more Heroin to the patient. Your solution to the burst bubble is to try to reflate it.   But each increase in the dosage yields a less satisfying high. The Keynesians will prescribe more Heroin until the patient dies of an overdose. 

        In our case, that means default at the local, state, and Federal level.

  2. Buy Evanston—but first we need to get the businesses

       A number of cuts have been proposed but it seems each gets opposed by someone who does not want his ‘ox gored’ and it is still an open question how many cuts will be made after the Council gives in to special interests—large and small.

       However the cuts, even if completed and dramatic, probably can’t be repeated for many years which it would take.

        Instead the revenue side must be attacked and I don’t mean taxes.  Evanston has to be a more inviting place for people to want to move to—or stay in terms of current residents and NU faculty and students.   Crime reduction, improving the problems with the schools and Board, lower taxes [last I knew we still had one of the highest rates in Cook], etc. would help.

       But we need to get business back into Evanston—and I don’t mean the tax incentives,  gifts to favored businesses and we have seen doled out.   We use to have a downtown where you could buy most anything and industry [remember RustOlim(sp), Pasquesi and I think others on the west side] and large employers [Washington National, American Hospital, the big commerical insurer across from Carmens], small busineses on Custer, etc..  Yes some went out of business for reasons unrelated to Evanston—but they were not replaced by others.   And yes some like Fields gave up [despite seeming good business] to move to the mauls.

       We need to get these types of businesses back instead of everyone going to the mauls outside of Evanston, stores in Chicago, Walmart, ABT.  Evanston is so close to public transportation that many residents [esp. students, singles, elderly] don’t have or want cars to travel to the mauls, etc.. Certainly we can support [and get jobs, revenue for the merchants and taxes] more clothing stores [remember all of them–not just high end], appliances stores, shoe stores [at least two at one time], electronics, drug stores, and so on.  Remember we use to have several drug stores down town—and would have had Osco if not booted at the last minute—McDonalds [if not booted by the hotel], KFC, Browns, electronics stores [remember Pacific Stereo and a store on Chicago Ave.], a Fields, Wiebolts, Baskins,  Lytons, a grocery downtown [Dominicks and A&P], Highlands, K-Mart, Fedders—-you could get just about anything in Evanston. [Again some left for other reasons or chains went out of business].

       Why no more ?  Taxes, harassment of business [remember the sign inspectors], zoning and Council decisions that take almost forever [apparently lost us Sears a few years ago].  Maybe the Research Park would have worked  if the city would have worked harder with NU instead of spending so much time about a ‘nuclear free zone.’  [Harassing NU with historic district, Jacobs Center construction [elevator shaft could not be seen from the street even though covered with the same materials as the building]. We have to stop scaring business away—not just retail.

       People will buy Evanston if they have somewhere/something to buy.  Then we would keep revenue and jobs in Evanston instead of Skokie, Shaumberg, Niles and Chicago.

  3. At least Evanston got some

    At least Evanston got some shiny new gas guzzling police cruisers to keep the mundanes in line before the realization "we have too much debt". It will be a big help in harvesting revenue (ie. traffic tickets). But, as we know it is all about safety.

    Got to keep the gravy train running for the "privileged" government employees and public unions.

Leave a comment
The goal of our comment policy is to make the comments section a vibrant yet civil space. Treat each other with respect — even the people you disagree with. Whenever possible, provide links to credible documentary evidence to back up your factual claims.

Your email address will not be published.