Hawthorn Woods lays off six more employees

Hawthorn Woods laid off six employees and slashed expenses Thursday in a second round of budget cuts to reduce a $750,000 deficit projected at the end of this fiscal year.

The cuts still leave the village with a $710,000 deficit at year end on April 30. Yet, it should allow the village to balance next year's budget, officials said.

"There's no quick fix here," Mayor Keith Hunt said. "There's no Band-Aid. We didn't build the general fund overnight; we're not going to replenish it overnight."

Staff reductions include one building and zoning department employee, three from the police department, and two public-works employees.

That brings the number of village employees to 18, down from 32 employees last fall.

"Once again, it's a sad day for the village of Hawthorn Woods," Trustee Steve Riess said. "Several long-term employees who have contributed to the well being of Hawthorn Woods are now out on the street. Unfortunately, based on the current financial situation, we didn't have much choice."

In November, the village laid off eight employees -- three police officers, two building-department workers, and three public-works employees.

At the time, village officials blamed the housing market slump for a $750,000 deficit, which was cut in half by budget reductions and staff layoffs.

Village officials learned last week the deficit remains at $750,000 -- even with the earlier cuts -- because of a revenue shortfall attributed to the drop in new construction.

Resident Scott Parker, who attended a special village board meeting Wednesday night to discuss the village's financial situation, said he was surprised by the new layoffs.

"I just don't think that's right," Parker said Thursday of the village's decision to cut police officers. He also questioned why the deficit increased from November's projections.

The village has now removed building permits and other development-related revenues from the operating-budget mix because it was relying too heavily on those fluctuating funds, Hunt said.

"What we have done is taken the village back to the right size, given recurring revenues," Hunt said. "We've gone back and completely restructured how the village is approaching the budgeting process to ensure our daily operations are funded only by predictable, recurring revenues."

Officials also eliminated some nonessential expenses, such as elected officials' salaries and health insurance, and reduced the travel budget.

The budget for elected officials for fiscal year 2008 was $108,000, which includes a range of expenses, such as travel, publications, training, dues and printing copies. That number has been cut to $7,200 for the budget period May 1 through Dec. 31, and $13,000 is budgeted for 2009 when the village begins a new budget cycle based on the calendar year.

Other belt-tightening measures include deferring capital expenses until after the 2009 budget year, cutting spending on legal expenses, deferring or eliminating technology purchases, and bringing certain operations in-house, Hunt said.

All the cuts will take effect now or by May 1.

"You start with a clean slate in May," Hunt said. "As the building-related revenues come in, they will go back in to replenish the general fund and the reserves."