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|Estimates May Create Future Budgeting Problems
|The Galesburg City Council got a first look at the City Administration's multi-year forecast for the General Fund at last night's Special Work Session meeting.
The 5-year forecast estimates what City Manager Todd Thompson calls a "structural" deficit - where expenditures are consistently outpacing revenues, year-over-year.
What Thompson showed the Council predicted flat revenues alongside continually increasing costs, but the projections leave out the assumption of City Council cost cutting or revenue increases.
Thompson says that there are several reasons behind the relatively large increase in expenditures.
"We anticipate that they go up at a continuing rate because of factors we've considered, one of them is, of course, healthcare," says Thompson. "Healthcare has gone up quite a bit, it's a real challenge for the City."
The City Council faces a $1.6-million budget deficit for the 2014 fiscal year.
If the City Council wishes to maintain funds at 30% funding levels, revenue increases and further cost cutting is being forecast in the following years, including a $1.8-million hold in the 2015 budget year.
Thompson is expecting revenues to decrease by 2% and expenses to increase by 5% in fiscal year 2014 without City Council action.
"Traditionally we haven't taken in sufficient premiums to cover the cost and then we've had some bad years so those two things compounded and have been a significant problem for the general fund," says Thompson
A balanced approach to solving the problem was recommended. Fifth Ward Alderman Peter Schwartzman says Galesburg isn't the only City facing problems and should look outside the community for solutions.
"A lot of these challenges, and I think the public needs to understand, are beyond our ability to control them at some level," says Schwartzman. "I'm not saying that to say we don't have a lot of power to make changes that we need to make to improve things and we need to know what those are."
The Council filled an $800,000 deficit in fiscal year 2013 and showed frustrations by the year-to-year nature of the budgeting process.
Alderman also reviewed the Economic Development Department's BRED program and it's results after one month of operation.
Stronger reporting requirements was among the suggestions, but Mayor and WGIL owner John Pritchard expressed concerns about it's goals of consulting companies as opposed to retaining them.
|06 24 13 by Newsroom
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