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New aldermen face tight budget

The city’s finance chief told incoming Evanston aldermen Monday that they will face a tough job balancing the city’s spending with its revenue in a down economy.


The city’s finance chief told incoming Evanston aldermen Monday that they will face a tough job balancing the city’s spending with its revenue in a down economy.

Assistant City Manager and Finance Director Marty Lyons said that compared to many other communities Evanston is doing relatively well, because ot its diverse revenue base.

But he said sales tax revenue for the year is likely, at best, to be stagnant.

The darkest spot in the budget may be real estate transfer tax revenue. The expected intake from that was cut from $4 million a year ago to $3.3 million for this year, and “because we’re seeing fewer transactions at lower prices, we won’t hit that budget this year,” Lyons said.

He offered no new estimate on the total public safety pension liability, which stood at $145 million before the financial markets slumped last fall.

But he suggested that because of state-mandated conservative investment policies by the pension funds the shortfall is likely to be less than what many other retirement plans have experienced.

Lyons added that there is a move in the state legislature to extend the deadline for having the police and fire pensions fully funded. The current deadline is 2033. He said the proposed new deadline would be 2049 — chosen because it’s 40 years into the future.

But Lyons said the legislature is also considering raising health insurance benefits for retired firefighters and extend the benefit period, which “is not the most fiscally responsible approach.”

He said the down economy has increased competition for federal grants the city can apply for. The economic stimulus package may offset that trend, Lyons said, but the city is still waiting to hear what projects it has requested will actually be funded.

Expenses continue to increase, with the city recently settling two union contracts for one year terms. The firefighters deal raises city payroll costs by 3.8 percent, while the settlement with AFSME increase costs 2.9 percent.

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