Kane County credits large budget surplus to 'robust' economy

 
 
Updated 3/24/2022 5:06 PM

Kane County officials spent months in the lead-up to the 2021 fiscal year trying to balance a budget that forecast a $14 million deficit stemming from the height of the COVID-19 pandemic. But as officials began to close the books on the 2021 fiscal year this week, the county's ledger shows a $17.5 million surplus.

The unexpected cushion is the largest budget surplus in more than a decade. And for some county board members, it casts new doubt on the need to continue discussions about creating a new county sales tax.

 

Chief Financial Officer Joe Onzick revealed the unexpected good fortune to the county board's finance committee Wednesday. The county brought in $11.3 million more than Onzick projected. Most of that came in the form of the county's share of local sales and income tax revenue. At the same time, county officials spent $6.2 million less than budgeted. Much of that came from unfilled job vacancies.

"The economy has rebounded much more quickly and robustly than we had anticipated," Onzick said of the windfall.

County board members must now decide what to do with the money.

In recent years, the board socked away half of any surplus funds into a Property Tax Freeze Protection Fund. The other half would go into the county's capital expenses fund to pay for infrastructure repairs, upgrades and new facilities.

As the name implies, the Property Tax Freeze Protection Fund is used instead of increasing the county's property tax levy to keep up with annual cost of living adjustments. A plan pitched by Onzick this week would put $4.48 million of the surplus into that account.

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Another $4.48 million would go into the capital projects fund.

Onzick also suggested the county board refund $8 million of federal COVID-19 rescue money used to cover pandemic-related payroll and expenses. County officials already have about $71 million in unallocated pandemic relief money.

Food pantry organizations recently came to the county to ask for more COVID-19 relief money to assist residents struggling to keep up with rising food costs. However, there continues to be a divide on the county board about how much relief money the county should keep for its own expenses (and to ward off tax increases) versus how much of the federal dollars should go to community and social service organizations.

The county received $103 million in federal CARES Act funds. It's shared $4 million of that with local mental health service providers, homeless shelters and food pantries so far.

All of that unspent money, combined with the $17.5 million surplus, began pushing Republican members of the county board, like Bill Lenert, to suggest a new county sales tax isn't needed.

                                                                                                                                                                                                                       
 

"The timing of this (sales tax) right now is very poor," Lenert said. "We've received almost $200 million, and then we're saying that's not enough, and we need more. I just don't see the feasibility of getting that on the ballot or passed by the taxpayers."

But Democrats on the board, like Vern Tepe, are pushing for long-term thinking after the COVID dollars dry up or a possible recession sets in. Tepe, and county board Chair Corinne Pierog, argued state-mandated justice reforms will impose new annual costs that aren't going away.

"Far too long this board has kicked the can down the road in looking at issues that need to be dealt with," Tepe said. "We need to deal with these issues now."

Board members voted earlier this week to defer any decision on a new county sales tax until after the June primary election.

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