Palatine facing as much as $7 million revenue loss due to pandemic
Palatine will enact a series of measures to save about $5.3 million through the rest of this year in an effort to counter potential lost income due to the COVID-19 pandemic.
Although the exact toll on Palatine's finances from the business shutdowns this year is not yet known, Village Manager Reid Ottesen said information from state-level officials and research indicates it could wind up at $3.5 million to $7 million.
Revenue declines projected from the Illinois income tax, as well as home rule and state sales taxes, led the village council this week to approve an amended budget to save roughly $5.3 million. Village council members in December approved the balanced $123 million budget for 2020.
Ottesen said the village intends to continue delivering a high level of services and is not considering an increase in the municipal property tax for 2021.
"I can't appreciate enough the effort you guys have done to do this, to not come with (a tax hike proposal) as of right now," Councilman Kollin Kozlowski told Ottesen and other village officials.
The council agreed with a recommendation to conserve $750,000 this year by enacting a hiring freeze through 2021.
Palatine also will tap into $1.6 million from an economic stabilization fund and use excess reserves of about $1.3 million from the 2019 budget to offset this year's projected losses.
About $580,000 more will be pocketed through a 10% reduction in purchases of supplies and services.
"The 10% reduction in supplies and services, we've eliminated all travel, a significant reduction in training," Ottesen said. "We've thrown out the strategic plan that we were going to do."
While it won't help the revenue problem, Ottesen said Palatine is expected to receive up to $546,761 in Coronavirus Aid, Relief and Economic Security Act funding to cover personal protective equipment and village hall reopening expenses, office reconfiguration to enhance social distancing and the purchase of technology for remote meetings and work.
Ottesen said Palatine should have been in line for $2.8 million from the state allocation of CARES funding but will receive the $546,761 instead because of Cook County's distribution formula that's partly based on a community's income level and sales tax revenue.