Elgin could see more layoffs

Despite layoffs, early retirements, raising fees and cutting services like the July 4 fireworks, the city of Elgin has collected $3.3 million less this year than it had budgeted for and could be in line for more personnel cuts.

City council members recently reviewed Elgin's financial picture halfway through 2009.

Jim Nowicki, the city's finance director, pointed to drops in revenues from the city's share of the state's sales and income taxes, along with a drop in interest income.

For now, the city will make ends meet by dipping into its $14.1 million reserve fund that was started when the Grand Victoria Casino opened in the mid-1990s.

City officials will start compiling numbers for that in October with the budget due to be approved in December, but Mayor Ed Schock said he believes the city will have no choice but to cut more people in the next year's budget.

"We're going to have to cut more. We're going to have to cut pay or pay raises or people," he said. "You can only save so much cutting light bulbs and paper. It's not pleasant stuff. It's not fun. It is what it is."

Bad news also continued from the Grand Victoria Casino.

The city's share of casino profits has been, on average, 12 percent less each month for 2009, which will be $2.3 million less than what city officials expected.

Other areas posed concern for city leaders.

While sales tax revenue is projected to be down $950,000 from what the city expected, some trends show sales tax receipts could dip 11 percent, or $1.7 million, by year's end. That would make things worse.

Also, the fire department has already used $968,000, or 87 percent, of the $1.1 million budgeted for overtime this year.

Last November, the city cut some $5 million from its expenses as 52 positions were eliminated through 16 layoffs, attrition, reassignments and early retirements. This summer, 21 employees took early retirement, a record since the city offered that option.

Elgin officials increased some fees for the Centre and some building permits.

Schock said those moves have helped, but are not the complete answer.

"You're not going to get $3 million out of a fee increase," Schock said. "I don't think that anybody is in the mood to raise taxes in a bad economy. Our citizens are hurting too. We have less money, so we're going to have to provide less service. We can't spend what we don't have."