Vernon Hills hits state on proposed cuts

The proposed 2010-11 budget in Vernon Hills shows a modest surplus, the result of constant and deep cost cuts.

Now, having hacked more than $3 million in expenses, or more than 15 percent compared to the previous year, village leaders consider a possible cut in the amount of income tax money it receives from the state as a slap in the face.

The board this week heartily agreed to send a letter to political leaders and local state legislators expressing dismay at a proposed reduction in the portion of state income tax money that goes back to municipalities, to 7 percent from 10 percent.

That could result in a loss to the village of more than $539,000, which comes on top of the erosion in total income tax revenues because of the poor economy.

Village officials in the letter say that decline would represent the equivalent of five police officers.

"We've done our job. We're trying," said Trustee Cindy Hebda. "They need to go back and make some hard decisions."

That sentiment is echoed by many municipalities, where officials say local governments should not be among the solutions for the state's budget predicament.

"The municipalities are making cuts already and have been for two years," said Chris Gentes, executive director of the Lake County Municipal League.

"The villages are cutting their budgets and laying off employees and now they're going to get whacked by the state? That's ridiculous."

At full funding, Vernon Hills receives about $2.1 million as its share of the state income tax. That has dropped to $1.8 million because of the economy and would slide further, to about $1.3 million, if legislators approved the reduction.

According to the letter, the reduction from the shared income tax presents a problem in funding basic services, like police and public works.

Village trustees this year have met extensively to identify cuts in light of declining revenue sources, particularly from sales taxes, which are expected to be down $736,000 next year.

Overall, the budget has been reduced from $20.8 million to $17.6 million.

"This is probably the most previewed budget in the village's 52-year existence," said Village Manager Mike Allison.

"It may be a new ballgame depending on what happens with the income tax."

Spending for operations was reduced more than $2.4 million, including accelerated retirement incentives and other personnel moves. Capital spending was reduced by more than $800,000.

"We've basically eliminated about $1 million in salaries and benefits," through personnel moves, said Finance Director Larry Nakrin.

The proposed 2010-11 budget, which must be approved by April 30, contains a projected surplus of $324,000 of revenues over expenditures.

A public hearing is scheduled for April 6, and the village board will review the budget on April 17.