By Vincent BradshawThe Daily Northwestern

In the face of a budget deficit, Evanston City Manager Julia Carroll has begun proposing possible cuts and a tax increase for next year.

Higher property taxes and the elimination of 35 city jobs were some of the ideas discussed Monday night at the city’s final budget policy meeting. The City Council will receive a proposed budget for the 2007-08 fiscal year in December.

Carroll asked aldermen to consider three different options after she told city council members last week about a potential $2.5 million shortage in Evanston’s general fund.

The fund is used for police, recreation and other city services.

New state legislation allowing firefighters to retire sooner, and poor performance by city investments, are to blame for the larger deficit, she said.

Carroll walked aldermen through three possible tax increase policies and explained job cuts that would occur under each plan. One policy would raise property taxes by 1 percent, providing $584,500 for the fund. But the plan would also require the city to eliminate almost 26 positions.

Another plan would result in a 1.65-percent tax increase, but it only would cover half of the expected budget deficit and require cutting about 14 positions. Carroll’s third suggestion would cover the deficit and raise taxes by 2.2 percent, with about seven job cuts. This proposal does not include funding for new staff positions.

Carroll and Judy Witt, director of human resources, also presented specific plans to cut two vacant positions in the sanitation department and change the city’s pension program and pharmacy plan.

The proposals concerned several aldermen, who questioned whether the cuts would hurt the city’s efficiency.

“When you (mention these cuts), it’s very threatening,” Ald. Ann Rainey (8th) said. “It’s really going to be difficult to have these kinds of cuts and maintain the same level of service.”

Some aldermen said they wanted to see more evidence of the effects of the cuts before they decide on the proposals. A proposed budget with projected revenues is necessary, they said.

“I can’t make that decision right now,” Ald. Lionel Jean-Baptiste (2nd) said. “The last couple of years, we faced a large litigation obligation, plus we faced a large gap … and we did not have to cut positions. We looked at all our options and we came out with budgets that were responsive to the community.”

Throughout the meeting, Carroll reminded the council that these are only proposals and that the final suggestion for a tax levy would come in December. She said the policy meeting would help her office shape the final report, and it would be fair to let the city know about its budget problems and the possible cuts.

“I think it’s fair to let employees know well in advance,” Carroll said. “I’m trying to give them a heads up.”

Witt also proposed a plan to encourage city employees to retire early. An early retirement program would save Evanston in both fringe benefits and payroll costs, Witt said. Some city positions would be revised for lower salaries.

“If we have a massive exodus of our department heads, I’m extremely concerned with what we’re going to be left with,” Rainey said.

The council agreed to allow the human relations department to research the idea.

Reach Vincent Bradshaw at [email protected].