Community Budget Workshop

Community Budget Workshop

City Council Chambers7:00 p.m. - September 14, 2010

www.cityofevanston.org/budget

http://www.cityofevanston.org/budget

Today’s Outcomes

Overview

Facts About Our City

The City’s Budget Process

Municipal Revenues and Expenditures and Other Funds

Review of FY10-11 Budget and Citizen Recommendations

City’s Current Budget Challenges

Questions/Thoughts/Discussion


Organizational Structure

The City of Evanston, Illinois is a full service municipal government located in Cook County, IL

It is a home rule unit, as defined in the 1970 Illinois Constitution, which means that we have certain powers to tax and enact local ordinances

Council / Manager form of government adopted in 1957

Organized to provide for the health, safety and welfare of Evanston residents.

Population77,857 (2009 Census Estimate)

76,406 (2006 Estimate from City of Evanston Community Development Department)

Size

8.0 Square Miles 30,817 Housing Units

147 Miles of Street 76 Miles of Alleys

208 miles of Sewers 5,641 Street Lights

Evanston Municipal Facts


Police & Fire

Protection

–164 Sworn Police Officers

• 11 Parking Enforcement Officers

• 49 Crossing Guards

–107 Sworn Firefighters

• 5 Fire Stations

• 1,385 Fire Hydrants

Municipal

Parking

– 2,300 Parking Meters

– 35 Parking Lots

– 3 Parking Garages with a capacity of 3,283 vehicles



Library Services

1 Main & 2 Branch Libraries

495,800 Books and Materials

65,638 Registered Borrowers

Park & Recreation Facilities

265 Acres of Park Area 75 Parks and Playgrounds5 Beaches (Public Swimming)6 Recreation Centers:

* Chandler-Newberger Community * Ecology *

* Noyes Cultural Arts * Levy Senior *

* Fleetwood-Jourdain Community *

* Robert Crown *



Municipal

Water Utility

– Population Served – 359,357• Evanston (77,857)• Skokie (63,400)• Northwest Water Commission (221,597)

– Filtration Capacity - 108 million gallons / day– Pumping Capacity - 147 million gallons / day– Average Pumpage – 40.3 million gallons / day– 157.5 Miles of Water Mains




City of Evanston

School District 65

School District 202 (ETHS)

Community College 535 (Oakton)

There are many units of government that service and tax Evanston Residents:

Cook County Evanston Township

Cook County Forest Preserve

Water Reclamation District

Mosquito Abatement District

Budget Overview

A Budget Is…

A legal document that serves as a government’s financial operating plan;

A financial and policy document for how the City provides services to residents;

A tool for communicating how tax money is spent;

Includes operating and capital costs and is categorized by fund;

Allows citizens an opportunity to be heard by their elected officials.

Budget Overview

Fund Based Budgets:

• General Fund: Supports general City operations (i.e. Police, Fire, Library, General Administration, Community and Economic Development, Health, Parks, Recreation and Community Services)

• Enterprise Fund: Used for services which charge a fee-handled like a business (i.e. Water, Sewer, Solid Waste and Parking Funds)

• Capital Improvement Fund: Separates major infrastructure and facilities expenses from operating expenses

• Special Revenue Fund: Created to monitor a specific activity (i.e. Economic Development Fund)

Budget Overview

Fund Based Budgets (Cont’d):

• Debt Service Fund: Monitors all G.O. Debt supported by property taxes

• Internal Service Funds: Created to centralize city operations (i.e. Insurance and Fleet Funds)

• Trust Funds: (i.e. Police and Fire Pension Funds)

Budget Overview

Notes The current budget policy requires a fund reserve of 8.3% for the General Fund and 10% for Enterprise Funds.

One-time money should only be spent on one-time expenditures.

Budget Process

The Budget Process

Budget Office receives requests from

Departments (July)

Requests revised to match revenue

projections (Aug.-Sept.)

Budget presented to Council in October

Several budget discussions held by Council (Oct.-Nov.)

Public Hearing is held in November

Council budget discussions continue

(Citizen Comment Welcome)

Budget Adopted (anticipated November 22)

Budget

How Big is Evanston’s Budget?

The City’s total operating budget is $224,438,941

The City’s General Fund Budget is $86,578,760

Budget

City Other Funds Include:

• Parking

• Water

• Sewer

• Motor Fuel Tax

• Fleet Service

• Emergency Telephone

• CIP

• Garage Funds (Sherman, Maple, Church)

• Downtown II TIF

• Howard / Ridge TIF

• Howard / Hartrey TIF

• CDBG

• Special Assessment

Municipal Revenue

Where do we get our Money?(Sources)

Municipal Revenue

Revenues by Type:

Property Taxes

Other Taxes

Licenses Permits and Fees

Fines and Forfeitures

Charges for Services

Revenues from State and Federal Government

Transfers from Other Funds

Municipal Revenue

FY 2010-11 Budget

Transfers From Other Funds8.44%

Other Taxes43.12%

Other Revenue2.71%

Interest Revenue0.12% Library Revenue

0.15%

Property Tax19.05%

Service Charges10.86%

Intergovernmental Revenue

0.90%

Fines5.07%

Licenses , permits and Fees

9.58%

Municipal Revenue

FY 2010-11 Adopted

$2.35

$8.32

$7.34

$16.55

$0.10

0.13

$0.79

$4.40

$9.43

$37.46

$0.00 $10.00 $20.00 $30.00 $40.00Dollars - Millions

Other Taxes

Property Tax

Transfers from Other Funds

Licenses, Permits, & Fees


Fines

Federal & State Revenue

Other Revenue

Library Revenue

Interest Income

Property Tax Revenue

Property Tax Bill Based on 2008 Tax Rates

District 202*26.55%

District 65*39.35%

Oakton Community College*

2.16%

City of Evanston19.97%

Cook County6.40%

Evanston Township0.77%

Other0.91%

Water Reclamation3.89%


City % Share of the Property Tax History

19.7419.7019.6019.96

19.56

18.95

18.55

20.00

20.8021.70

22.5023.40

25.4026.00

27.90

27.90

28.40

27.80

28.50

19.30

18.62

17.84

18.72

18.40

17.70

18.29

18.52

16

18

20

22

24

26

28

30

Year

Pe

rce

nt


How We Compare with Other Communities - 2008 Property Tax Levy

0.974%

1.039%

1.182%

1.238%

1.295%

1.975%

1.451%

1.425%

1.391%

0.000% 0.500% 1.000% 1.500% 2.000% 2.500%

Glenview

Park Ridge

Wilmette

Skokie

Evanston

DesPlaines

Hoffman Estates

Arlington Heights

Oak Park

Tax Levy

Tax Levy=Municipality+ Park District + Library Fund

Other Tax Revenue

Other Taxes (Some Examples) Sales Tax (Basic) -1% on all purchases ($8,914,000)

Sales Tax (Home Rule) - 1% on selected purchases ($5,520,000)

State Income Tax - ($5,717,000)

Real Estate Transfer Tax - ($1,600,000)

Athletic Tax - 11% on athletic events ($650,000)

Liquor Tax - 6% on purchases ($2,050,000)

Cigarette Tax - $.60 per pack ($485,000)

Telecommunications Tax - ($3,230,000)

Parking Tax - ($1,785,000)

Utility Taxes - ($5,254,000)

Other Tax Revenue

FY 10-11 Adopted General Fund Revenue

$3.2

$0.5

$2.1

$1.6

$5.7

$5.3

$1.8

$0.7

$5.5

$8.9

$0.0 $2.0 $4.0 $6.0 $8.0 $10.0Dollars - Millions

Sales Tax - Basic

Sales Tax - Home Rule

State Income Tax

Real Estate Transfer Tax

Athletic Tax

Liquor Tax

Cigarette Tax

Telecommunications Tax

Parking

Utility Taxes

4.0 4.0

2.8

3.7

4.2 4.5

4.0

2.1

1.6 1.6 1.6

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

12001-02 2002-03 2003-042004-05 2005-06 2006-072007-08 2008-09 2009-102010-11 Budget 2010-11 Estimate

General Fund Revenue

Real Estate Transfer Tax Revenue:


License, Permits, & Fees (Some Examples)

Vehicle Licenses - $75 per vehicle ($2,700,000)

Business Licenses - ($171,000)

Building Permits - ($2,200,000)

Liquor Licenses - ($370,500)


Building Permit Revenue

3.10

1.9 1.9 1.9

3.1 3.1

4.5

2.9

1.5

2.2

2.7

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

2001-02 2002-03 2003-042004-05 2005-06 2006-072007-08 2008-09 2009-102010-11 Budget 2010-11 Est.

An economically sensitive revenue that depends heavily on development


Fines and Forfeitures (Some Examples):

Parking Tickets - $3.5 million annually

Boot Release Fee - $68,000 annually

False Alarm Fines - $165,000 annually

Library Fines and Fees - $195,000 annually

Municipal Revenue

Parking Ticket Fines

3.243.0

3.43.1

2.8

3.2

3.6 3.63.4 3.5 3.4

0

0.5

1

1.5

2

2.5

3

3.5

4

2001-02 2002-03 2003-04

2004-05 2005-06 2006-072007-08 2008-09 2009-10

2010-11 Budget 2010-11 Est.


Charges for Services (Some Examples):

Ambulance Fees - $985,000

Recreation Programs - $4,940,000

Refuse Charge - $2,442,400

Alarm Registration Fee – $150,000



6.0 6.16.9 7.2

7.78.4 8.7

9.4 9.4

0123456789

10

2003-04 2004-05 2005-06

2006-07 2007-08 2008-09

2009-10 2010-11 Budget 2010-11 Est.

• Ambulance Fees

• Recreation

Programs

• Refuse Charges

• Alarm

Registration Fees


State and Federal Grants Used for the General Fund Operating Budget

Community Development Block Grant (CDBG) Reimbursement for some personnel costs - $856,000

Health Department (various grants) - $613,700

Other Grants - $171,800

Other Fund Revenue

Transfers from Other Funds / Cover the Cost of Administration

• Parking Fund

• Emergency Telephone System

• Motor Fuel Tax Fund

• CDBG Fund

• HOME Fund

• Maple Garage Fund

• TIF Funds

• Water Fund

• Fleet Service Fund

• Economic Development Fund

• Sewer Fund

• Capital Improvement Fund

• Housing Fund

Municipal Expenses

Where do we spend our money? (Uses)

Municipal Expenses

General Fund

• Personnel Costs - approximately 75% of budget

• Services & Supplies - approximately 21% of budget

• Capital Outlay - 1.4% of budget

• Insurance & Other Transfers - 2% of budget

• Community Sponsored Organizations – 1% of budget

Expenses by Type

75%

21%

1% 1%2%

Personnel Costs

Services & Supplies

Capital Outlay

Insurance & Other Transfers

Community SponsoredOrganizations

Expenses by Department

Police Department

Parks/Rec/Comm Services

Public Works

Fire Department

Administrative Services

Library

Community & Economic Dev.

Health Department

City Manager's Office

Legal

City Council

$- $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000

1

Other Funds

Other Funds – Internal Service

Insurance Fund

• City is self insured with stop loss coverage beginning at $2,000,000.

• City is beginning to build up adequate insurance reserves to pay out future

liability and workers’ compensation claims and to stabilize the health insurance

fund – IPBC and allocations to departmental budgets.

• The following Funds contribute funding for Insurance: General, Parking, Water,

Sewer, E911, CDBG, Economic Development.

• Insurance Fund’s primary purpose is to set aside funding for all types of claims

against City.

Other Funds – Internal Service

Fleet Services Fund

• Fund is used to account for purchases of new vehicles and equipment as

well as major maintenance on vehicles & equipment.

• Funded by other City Funds that require vehicles/equipment such as

General, Parking, Water, Sewer.

• City will establish reserves in the upcoming year by returning unspent

funds to the Fleet Services Fund.

• City has been keeping many vehicles and equipment longer than

recommended useful life, causing increased maintenance needs.

• A comprehensive Fleet Study will occur in the upcoming year.

Other Funds - Fiduciary

Police Pension & Firefighters’ Pension

• Illinois law mandates Police and Firefighters’ pension and disability benefits.

• Under current law, both Police and Firefighters’ pension funds must be fully

funded no later than 2033. Currently, Police and Firefighters’ pension are funded

at 42.9% and 41.2% per most recent actuarial valuation reports.

• Both the City and active sworn officers and firefighters contribute to the

pensions. Officer/firefighter contribution rates are per State statute and are

9.91% for Police and 9.455% for Fire.

Other Funds - Enterprise

Parking Fund

• This Fund includes revenues and expenses for all City pay parking lots,

as well as the Church, Maple, and Sherman Avenue Garages.

• Setting parking rates is truly a balancing act. A great deal of analysis

and professional judgment is needed to determine best parking rates to

continue to attract potential customers to downtown while still charging

enough to make the Fund self-sufficient for operating and debt

expenses.

• Without the subsidy provided from City TIF Funds, this Fund would not

be self sufficient on an annual operating basis.

Other Funds - Enterprise

Water & Sewer Funds

• Water funds account for all revenue and expenses related to pumping, filtration, distribution, meters, and other water distribution expenses, including capital equipment.

• Sewer funds account for all expenses related to the removal but not the “cleaning” of used water. Evanston residents are separately charged by the Water Reclamation District.

• The City sells its water to Evanston residents as well as Skokie and the Northwest Water Commission.

• Only Evanston residents pay the Sewer Fee.

• Sewer capital projects are often funded by low or zero interest IEPA loans.

• Water/Sewer rate discussion will occur this fall.

Other Funds - Designated

Motor Fuel Tax FundOperating budget varies each year based on State of IL estimated per capita distributions.

Emergency Telephone Funded through wireless and landline E911 surcharges paid by users.

Economic Development While legally not mandated to be a separate Fund – it is done so as it is funded primarily by City hotel and amusement taxes.

Review of FY10-11 BudgetCitizen Recommendations

Top Recommendations:

• Personnel cost reductions – 27 votes• Solid Waste cost reductions – 18 votes• Close Township Office and move to Civic Center – 15 votes• Sell water to other communities – 11 votes• Close Branch Libraries – 10 votes• Review Parking operation and fees – 8 votes• Close one Fire Station – 7 votes• Fine Arts development on lakefront – 5 votes• Increase employee contributions to benefits – 4 votes• 10% cut in Management across the board – 4 votes• Refinance current debt – 4 votes• Encourage business/commercial development – 4 votes

How did we do?

Positions - All Funds Last Five Fiscal Years

884.24

866.97

841.00

796.06

856.03

770.00

790.00

810.00

830.00

850.00

870.00

890.00

FY 2006-07 FY 2007-08 FY 2008-09 FY 2009-10 FY 2010-11

Fiscal Year

Pos

ition

s


•Solid Waste cost reductions – 18 votesRefuse contract out to bid – award expected on 9/27/10 with

anticipated savings of $560,000 – in-source recycling pickup – outsource solid waste pickup – savings projected @ - Solid Waste is now an enterprise fund, where revenues will be set to cover costs.

• Close Township Office and move to Civic Center – 15 votesNo action taken to date.

• Sell water to other communities – 11 votesOpportunities are currently being pursued.

• Close Branch Libraries – 10 votesBranches were funded in the current budget for six months. Local citizens group raised funds for additional six months so branches will remain open. City Council and Library Board are working on a long term solution to Library funding.


• Review Parking operation and fees – 8 votesParking Committee is reviewing operations, parking incentives

and fee generation – new software is being considered to enhance collections.

• Close one Fire Station – 7 votesRecommendation not being pursued at this time.

• Fine Arts development on lakefront – 5 votesLakefront Master Plan is being funded and implemented –A waterfront arts venue is not envisioned in the plan.

• Increase employee contributions to benefits – 4 votesThe majority of all employees are paying 10% more for health insurance benefits in the current year.


• 10% cut in Management across the board – 4 votesMany middle management positions were cut during the budget process, such as GIS Manager and Revenue Manager. City Manager, Assistant City Manager and Department Directors were given a 5% pay cut.

• Refinance current debt – 4 votesDebt was refinanced in the upcoming year.

• Encourage business/commercial development – 4 votesThe City continues to work with Downtown Evanston to keep the downtown area vibrant. TIFs are being reviewed to ensure all strategies are being employed to enhance development and business opportunities in other areas of the City.

Current Year Budget Challenges

General Fund revenues are flat today and are not projected to increase in the upcoming year.

Developing a ten month transitional budget.

Establishing reoccurring revenue sources to provide ongoing funding for Capital needs and other funds, such as Insurance and Fleet.

To minimize service reductions for the remainder of the 2009-10 fiscal year and come in on budget.

Possible delay of property tax receipts.

Possible reduction of income tax proceeds.

Expense Reduction Options

Hiring Freeze: Effective immediately, involving all or targeted positions.

Implement Reorganizations: Continue to look at combining positions as a result of attrition to achieve additionalcost savings.

Spending Freeze: All non-essential spending will be curtailed for the remainder of the year.

Expenditure Control: Expenditures over $1,000 will require City Manager’s Office approval.

Training & Travel: All training and travel requests must be justified. Approval from the City Manager’s Office for out-of-state training is required.

Overtime Analysis;Work with departments with high overtime and callback costs to minimizeexpenditures and explore long-term solutions to reduce costs.

Next Steps

Staff currently evaluating service delivery for opportunities to reduce costs.

Public input requested on service priorities, ideas for revenue enhancements, and cost containment strategies.

Joint recommendations from staff and public for balancing the budget will be shared with Council in October and November, 2010.

09/20/10Special City Council Meeting

Goal Setting & Mid-Year Financial Review6 p.m. – City Council Chambers

09/29/2010Community Budget Workshop

7 p.m. - Levy Center


Budget Discussion9:00 a.m. - TBD


Budget Discussion9:00 a.m. - TBD

Future Budget Sessions

11/08/2010Public Hearing – FY2011 Budget/Truth in

Taxation7:00 p.m. – City Council Chambers

11/15/2010Optional Special City Council Meeting

Budget Discussion7:00 p.m. TBD

11/17/2010Optional Special City Council Meeting

Budget Discussion7:00 p.m. TBD

11/22/2010City Council Meeting

Budget Adoption7:00 p.m. – City Council Chambers

Future Budget Sessions

Questions

Thoughts

Suggestions

Thank you!

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Community Budget Workshop

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