A smaller, balanced Elgin budget

In 2006, Elgin was living large while planning a budget that included 24 new positions for a population that was expected to hit 130,000 by 2010.

Fast forward to Wednesday, as city council members took their first hard look at a 2009 budget that represents a drop of 18 percent - or $60 million - from this year.

Growth has slowed to an estimated 106,000 people by 2010, and last week the city announced it was laying of 16 employees.

In all, 54 city positions will be cut through attrition, layoffs, not filling current vacancies, early retirement and reassignments.

"Our revenue sources are declining while our expenditures are increasing," said City Manager Femi Folarin. "Four months ago, the pattern was different. The last two months, it's gotten real bad."

But the $276 million spending plan for next year is balanced, and officials say they will be watching the books closely to see if more cuts are needed or if positions should be reinstated.

"The reality of the situation is leaves are still going to be picked up, if you need a paramedic they're going to come out there, the streets are going to be patrolled (by police)," said Councilman John Walters. "It's going to be harder for everyone, but it's going to happen."

This year, the city is on pace to spend about $336 million. At least $25 million came from repaving more than 40 miles of streets and buying more plows and equipment to improve snow removal service.

To help control costs, the city will not buy any new vehicles for the first three months of 2009, will cut back on spending for festivals, and postpone some big ticket projects, such as an eighth fire station and a redevelopment plan for the east side of the Fox River.

Assistant City Manager Sean Stegall, who is responsible for preparing the budget, said the city has three main sources of revenue: sales taxes, property taxes and a share of the state's income taxes.

"All three are declining at the same time, and that has never happened before," he said. "It truly is something we have not experienced before."

Overall, the city's 2009 payroll is expected to rise about 2.7 percent, which officials said is a slight increase. The police department's budget will increase about $1.9 million, a bump of about 6.5 percent.

Since the casino opened 14 years ago, city officials have used revenues for one-time expenses instead of funding operations, such as employee payroll. Next year, the city will keep that practice in place, but it will divert some money to a reserve fund in case the economy worsens.

City leaders will revisit the budget at 5 p.m. Dec. 3 at city hall, 150 Dexter Court. If needed, another workshop is scheduled for Dec. 10 with a 7 p.m. meeting on Dec. 17 to approve it.