GOAL SETTING FOCUSED ON FISCAL RESPONSIBILITY
The Village Board held a Goal Setting Workshop on Thursday, November 5, to set the direction for the Village’s Five Year Plan and the upcoming budget process. The meeting also marked the halfway point in the Village’s fiscal year which began on May 1.
As a part of that meeting, the Board talked through the challenges associated with the recently updated revenue forecast which projects an additional shortfall of $1.7M (net deficit of $2.6M). The shortfall results from unexpected reductions in the income tax, natural gas tax, and sales tax.
Income tax, which is collected by the state and distributed to municipalities based on population, is tracking 15% below earlier estimates. The Village forecasts income tax revenues based on estimates provided by the Illinois Municipal League (IML). Historically, these estimates have been extremely accurate. For the first time in recent memory, the IML retracted their estimate and issued a revised estimate in October. As a result the Village has had to reduce our income tax projections by $437,000.
Another unexpected change has been the drop in natural gas prices. Home heating bills have dropped dramatically – homes generating $150 gas bills are now paying closer to $40. This is great news for homeowners and provides some unexpected, but welcome relief! Unfortunately, Village gas tax collections will take a proportionate hit.
Finally, while we had anticipated a 10% decline in sales tax dollars from prior years, the collections have dropped more steeply and are tracking at 14.3% less than budget (close to $253,000 year to date). Based on changes in consumer behavior, revenue projections have been reduced to align with the actual sales tax receipt collections.
Village staff at all levels are examining opportunities to reduce cost, eliminate non-essential expense, reviewing projects for possible deferral, and considering options for providing service through more cost effective means. Though providing a challenge, the projected shortfalls are being aggressively addressed by staff. We are committed to providing the best service to Woodridge residents. Throughout this process, staff will be focused on better aligning expenses with projected revenue amounts while at the same time striving to maintain Woodridge’s high level of service to the community.
Understanding that the financial pressures facing the Village co-exist with financial pressures we are all faced with at home, the Village Board will adopt a tax levy on December 3 that will decrease the Village property tax rate for the 24th consecutive year. Additionally, construction of the two planned major capital projects, the Police Building Expansion and the Pedestrian Bridge over Route 53, will be deferred until the Village’s financial forecast is stronger.