Arlington Hts. weathers tough economic climate

Both Rolling Meadows and Des Plaines officials will probably have to lay off city employees to make ends meet in 2009. Thanks to a reserve fund totaling more than $20 million, Arlington Heights officials will not.

'That's what the surplus is there for," said Trustee Joe Farwell at Monday's committee meeting. "It's saving up for a rainy day."

On Monday, village officials looked over their proposed tax rate and levy for their May 1, 2009, to April 30, 2010, fiscal year budget. The village board will officially vote next Monday on tax levy and rate.

Like most suburban municipalities, Arlington Heights will plan on spending more than it takes in during the 2009-10 year. Projected revenues in the general fund are about $62.1 million while expenditures are $64.6 million, according to Thomas Kuehne, the village finance director and treasurer.

To make up the difference, the village will use about $2 million from its $21.6 million reserve account, Kuehne said.

It's not something village officials want to do every year, but now is not the time to start laying off village employees, Village Manager Bill Dixon said.

"The deadline for more severe action is this time next year," Dixon said. "Fuel prices, salt prices are changing drastically week by week. We have to be careful. We're lucky to have the reserves we do."

Besides tapping the reserve account, village officials will reduce costs by $500,000 next year and hire no additional employees, according to a village memo.

The village's portion of the proposed tax levy - which includes the Arlington Heights Memorial Library - will increase by 3.75 percent from $38.4 million to $39.8 million. This increase pertains to the bill payable in March and September 2009. The increase translates to an additional $46 on a $5,800 tax bill.

The levy includes an additional $300,000 that will help pay for nine new firefighters the board approved hiring in 2007. A federal grant paid for 80 percent of the firefighters' salaries in the first year, but the grant drops by 20 percent each year until the fifth year, when the village will pay for the entire $1.1 million cost of the salaries.

"I don't want to say looking back it was a bad decision," said Dixon about hiring the additional firefighters. "We had a great opportunity and had to pounce on it. We did the right thing, but it needs to be paid for."

The vast majority - or about 80 percent of the village's budget - pays for employees' salaries and benefits. The village's portion of a resident's total tax bill is about 10 percent. The library fund consists of about 5 percent.