Elgin's next budget not all bad news

More improvements could come to Elgin's downtown because of funds that are being generated from a special taxing district, city officials said at a budget discussion meeting Wednesday.

Redevelopment and rising property values have helped generate funds for the city's Central Area tax-increment financing district fund, but it also received a major boost last month when the state announced it was giving an $8 million grant for redevelopment of the Riverside Drive promenade.

That's expected to be the marquee project next year in the city's downtown redevelopment efforts.

More than half of the fund's projected $15.1 million in 2011 revenues is from the state grant, according to the city's proposed budget.

Only $400,000 will be spent on central business district streetscape and resurfacing improvements in 2011, but a total of $21.9 million is budgeted for street work through 2015. Most of money will come from the TIF district, with some funds taken from the city's water fund, according to the budget proposal.

Additional street rehabilitation near Spring Street and Dexter Avenue will cost just over $1 million, and will begin next year.

Meanwhile, the city's budget staff also discussed increased personnel costs, mainly due to a rise in pension and health insurance payments.

There's an expected 27 percent increase in the city's obligation to the Illinois Municipal Retirement Fund an expense that has to be paid, said Colleen Lavery, the city's chief financial officer. The city doesn't have leeway in delaying payments, unlike fire or police pensions, she added.

Employee insurance costs are expected to rise by 15 percent, Lavery said.

In response, the city won't fill some open positions, while focusing on establishing more public-private partnerships, said City Manger Sean Stegall.

“Pensions are expensive. Having a small, dedicated, adaptable group of city employees is what we want to operate under,” Stegall said.

Lavery also reported that water usage has gone down the past three years because of foreclosures and residents trying to conserve more. The city is projecting a 3 percent decrease in water consumption for 2011 monies that will have to be covered by water fund reserves.

Budget discussions will continue Nov. 17 at 5 p.m. at city hall, 150 Dexter Court. The budget is expected to be adopted Dec. 15.