More cuts to come in Hawthorn Woods

Hawthorn Woods faces an even greater budget deficit next year than village officials originally anticipated.

The projected deficit in the proposed 2009 budget is $131,000, up from $66,000 estimated in October.

More cuts are to come to keep expenses in line with revenues that have fallen far below expectations in the areas of police fines, interest income, and state income taxes, Mayor Keith Hunt said.

"Revenues still fell off what we were projecting conservatively," he said.

Since November 2007, the village slashed expenses significantly and laid off 14 employees to make up for revenue shortfalls caused by a slowdown in new home construction.

Those cuts helped the village turn around a roughly $722,000 deficit this fiscal year ending Dec. 31, to a projected surplus of roughly $110,000 to $120,000 in the general fund. Officials also anticipate a roughly $250,000 surplus in the village's community development fund.

The surplus would move into the village's reserves, unless officials decide to spend some of it on next year's expenses, Hunt said.

Part of that surplus money could be used to plug the deficit in the village's Special Service Area road program being audited for missing funds. The village doesn't have the roughly $2.7 million needed to finish nearly 10 miles of road improvements in 2009.

Though Hawthorn Woods is in the black this year, next year's anticipated revenue shortfalls will require slashing expenses further.

The village's advisory finance committee Monday outlined several possible cuts, including not hiring a police officer next year, saving roughly $64,000, more staff layoffs, reducing police pension contributions and expenses for elected officials.

The committee has rejected imposing new user fees and tax hikes to balance the budget. However, the committee did not consider other factors that may increase next year's deficit, Hunt said. The proposed 2009 budget does not include salary increases for police, which is currently under arbitration as part of contract talks.

The police union, which represents four patrol officers, is demanding 4 percent pay raises yearly for 2007, 2008 and 2009. Once arbitration ends, the impact to next year's budget could be $60,000 to $125,000, Hunt said.

Budget discussions will continue Dec. 8. A final decision on the 2009 budget is not expected until the regular village board meeting Dec. 15.