Arlington Heights facing layoffs next year
If Arlington Heights trustees approve the proposed tax levy as expected on Monday, they will probably be looking to fire people come March.
Villages throughout the Northwest suburbs approved their levies this month, but not one saw the public outcry that occurred in Arlington Heights.
About 150 residents rallied against the original 3.75 percent jump during two long meetings. Robert Babiak was one of the residents who spoke at Monday's meeting, held in the new $30 million village hall that opened this year.
"I feel like venting a little bit here," said Babiak. "You are detached from this community with your extravagant spending. Let's start with this over-the-top village hall."
In response to the public outcry, the board backed a smaller 0.32 percent levy increase on Monday. Because of pension commitments, the village will actually collect $165,000 less for general purposes than in 2009.
The immediate result of the smaller is levy is that the owner of a $340,000 will pay $3 more in village taxes instead of the original $46 more.
The long-term results are fewer village employees, fewer programs and possibly a whopper of a levy increase in 2010, according to village officials.
The village operates on a May 1, 2009, to April 30, 2010, fiscal year budget. Every December, the village sets its tax levy, which is the amount of money the village can raise through the property tax in the next calendar year. Before levy talks began, village staff trimmed $500,000 from the budget. Because the board backed a smaller levy increase, another $800,000 will have to be cut and between seven and nine employees fired, said Tom Kuehne, the village's finance director and treasurer.
"I don't see any way around it," said Trustee Tom Hayes who wanted a slightly higher levy increase. "I don't see how you can do it without eliminating positions."
The general fund pays about 400 village employees.
Like many suburban municipalities, Arlington Heights plans on spending more than it takes in during the coming budget year. Projected revenues in the general fund are about $62.1 million while expenditures are $64.6 million.
The village can make up the difference from a reserve account, which currently contains about $21.6 million. However, based on revenue and expenditure trends, Kuehne projects that account will decrease by millions of dollars every year, so that by 2014 the reserve account will be $8 million in the hole.
"Next year is going to be worse than this year," Kuehne said of the gap between revenues and expenditures at Monday's board meeting. "This is not a 'this year' problem."
If the board adopts the 0.32 increase on Monday, Arlington Heights residents could be looking at a 10 percent or 15 percent village levy increase for 2010 even with this year's layoffs., Kuehne said.
"Yes, it's certainly a possibility," he said. "We have pensions we have to fund."
There's also new firefighters that will need to be paid.
The original levy included 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 have to pay for the entire $1.1 million cost of the salaries.
Despite the village's bleak financial future, many officials said residents needs a break in 2009.
Village President Arlene Mulder and trustees Joe Farwell and Tom Stengren all wanted no levy increase.
"The thing about governments is that we always get our money; that's the way the system is set up," Stengren said at the meeting. "This year, it's time for tough decisions. We shouldn't get our money."
Arlington Heights trustees will officially approve the 0.32 levy at 8 p.m. on Monday at village hall, 33 S. Arlington Heights Road. After the levy is approved, the board will discuss the budget and possible layoffs in March.