Facing a $140 million pension fund deficit and a growing recession, the major players of Evanston government came together Saturday for their first discussion on the proposed budget for next year.
“The economy, wherever it is – global, national, state or local – it all looks the same,” said Martin Lyons, the city’s finance director, who took over in August.
Lyons led most of the meeting at the Evanston Civic Center, 2100 Ridge Ave., and gave a presentation on the major points of the plan for the 2009-2010 fiscal year.
The proposal includes raising the property tax in Evanston by almost 5 percent, which would generate $207,000 in additional revenue. It also relies on taking $5 million from the city’s General Fund and several other cost-saving methods.
This year’s budget is tight, as city officials try to make up for the $140 million deficit in the pension fund for police and firemen. The fund was underpaid for nearly 20 years, leaving the city in a tough position with 24 more years to make up the deficit.
Another reason for the increase in taxes on existing property is the sharp downturn in tax revenue from property transfers, Lyons said. Tax collections from real estate transfers are down 38.6 percent compared to last year, he said. The data was through November.
“It’s two things,” Lyons said. “We have fewer transactions and we have transactions at lower dollar amounts.”
The finance director repeatedly stressed that taxes needed to be increased in order to make up for lost revenue. He said that although spending cuts were an option, there was only so much cutting that could be done.
“Evanston is a full service community,” he said. “The whole range of services and then some are provided to Evanston residents.”
After Lyon’s presentation, both city council members and Evanston residents had a chance to voice their concerns regarding the presentation and the proposed budget.
“I’m amazed at the amount you people pay in taxes,” said Tom Burnham, who moved from Connecticut to Evanston four years ago. “It’s amazing to sit here and watch you people make a presentation raising taxes five percent.”
Burnham said he was also perplexed by Mayor Lorraine Morton’s promise of job security to existing city workers, asking why in the tough times the city was not making the same type of cuts that other businesses are making.
Other residents, including many candidates for mayor and alderman in April’s municipal election, also voiced concerns over various aspects of the proposal.
Sitting city officials were more supportive of the plan.
Ald. Ann Rainey (8th) commended the mayor for her decision against cutting jobs. Lyons also supported the decision, though he said city workers would still be held to a high standard and that it was merely positions that were guaranteed not to be cut; under-performing employees could still be fired.
The city managed to trim about a dozen jobs through an early retirement initiative passed two years ago.
Throughout the meeting, members of the council and the other city officials struck a cautiously optimistic tone regarding getting out of the economic downturn. Morton said that although times were tough, the city would get through it.
“We’re not on the mountain top,” she said. “We’re down in the valley.”
There will be another public hearing Feb. 2. The budget is scheduled to be adopted at a regular city council meeting Feb. 9.
