Kane County might raid transportation funds to fix budget deficits
As Kane County officials whittled down a midyear budget deficit Thursday, the sticker shock of a much larger financial problem in 2018 fueled consideration of a fund raid that would stall county transportation projects.
New projections show a $955,000 midyear shortfall remaining for 2017. That's a significant improvement from the $2.8 million deficit of a few months ago. Both the numbers and possible solutions remain on shaky ground.
The county's judicial system is the primary driver of the deficit. Collections on court case fines and fees are behind expectations.
The circuit court clerk's office has a new computer system causing temporary collection delays. There was no update Thursday on how far behind Circuit Court Clerk Tom Hartwell is, or how much the office expects to catch up by the end of the fiscal year.
The longer county officials delay a final solution to balance the budget, the more they may have to rely on cutting the county's biggest cost - personnel. But there are a couple of easy outs.
The county still has about $1 million in a property tax freeze protection fund created a few years ago. A recent audit showed Treasurer David Rickert's office had about $2.4 million socked away in an account that should help pay off countywide expenses.
Joe Onzick, the county's chief financial officer, warned against relying on one-time fixes to ongoing costs.
"This money should not be depended on for operations unless there is a one-time problem in operations," Onzick said.
Hartwell's collection issues may fit that definition. Once his office catches up, the expectation is the new computer system will be faster and more cost-efficient. Finance committee Chairman John Hoscheit deemed the midyear budget deficit "an anomaly" caused by the new system.
But a looming 2018 budget deficit is not an anomaly.
Onzick predicted a $6 million deficit in 2018. Fueling that is a $3.75 million drop in expected income. Hartwell's office owns about half of that loss. His partners in the justice system are responsible for almost all the rest.
Illinois' recent income tax increase won't help. The county gets a portion of the state income tax, but state lawmakers reduced that portion as part of the income tax increase. Kane County expects it will receive about $645,000 less for its share.
The $6 million deficit will likely grow. The number does not include any pay increases for county employees. All the county's union contracts expire at the end of 2017.
County board members extended union pay increases to nonunion employees in recent years. The raises averaged about 2 percent. An increase of that size would pile at least another $1.2 million onto the deficit.
Department heads tend to find expense cuts when it comes time for them to justify their budget to the full county board. If the county board can't find enough cuts, new income will be the only way to balance the 2018 budget.
One solution proposed would shift some or all the money the county received from the RTA sales tax. Much of that cash funds transportation department road projects, such as culvert replacements. Larger projects, like the Longmeadow Parkway, rely on federal and state money.
"The one tax we could choose to reallocate, as a matter of policy, would be the RTA sales tax," Hoscheit said. "We would put those (transportation) projects off for a period of time. It's an issue of prioritization."
County board Chairman Chris Lauzen neither endorsed nor condemned the idea.
"It's a true statement, an accurate statement," he said. "The only flexibility on revenue is that RTA tax."
The county board must decide if it will sweep the fund. Transportation officials will make a presentation on the impacts and legality of such a sweep in coming weeks.