Municipal budget on the way to surplus

The city’s budget revenues appeared “fairly stable, quite strong” mid-year, including in some areas previously down due to COVID, the city’s chief financial officer told Evanston City Council members in a presentation at their meeting. August 8th.

Revenues tied to economic activity, such as sales tax revenues, are in line with budget estimates, Hitesh Desai, the city’s CFO, told council members in his budget update.

Hitesh Desai (Photo of the City of Evanston)

The city’s share of the state’s income tax is trending higher, he said. Meanwhile, construction permit sales and real estate activity, two areas affected during COVID, are showing gains.

Revenue from construction permits is already at 59% of the budgeted amount, at half; and property transfer fees — the tax residents pay on the sale of real estate — have increased by 69%, he said.

Board members are not expected to start discussing the 2023 budget for several weeks. But talk of property tax increases or staff and program cuts — standard items of discussion in past budgets and especially during COVID — did not make it to the normally cautious employee presentation.

The city’s share of federal COVID relief funds was not harmed. Members of the current City Council took office in 2021 with the news that the city would receive $43.1 million in funds from the American Recovery Plan Act, a portion of money that previous councils did not have.
So far, the city has committed about $28.5 million of the funds, Desai said. The amount includes US$ 12.5 million for the city’s own needs, for equipment replacement and parking and general fund operations.

Desai asked Council members about using ARPA funds again for 2023. Personnel costs will be an issue with all three union contracts – police, fire and public works – to be negotiated later this year, he said.

A consultant’s report is due to be presented to the board, probably next month, “and we don’t know the recommendations, whether to add positions, how many positions, what kind of raises they’re recommending,” he said.

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