Machesney Park generates balanced budget for 2020-21 fiscal year

By Bob Balgemann

Reporter

First of two Parts

Village staff has once again put together a balanced budget for a new fiscal year, this one covering the period May 1, 2020, through April 30, 2021. Final action on the spending plan will be Monday night.

Approval on first reading came April 6, as part of the consent agenda and thereby with a 7-0 vote.

Before the vote there was a public hearing during which residents had an opportunity to comment on the proposal. An unusual procedure was in place because the COVID-19 pandemic resulted in all meetings that night being closed to the public. So those meetings were aired over the village’s Facebook page. And public comments were allowed by calling a telephone number that was part of the public link to those meetings.

Finance and Human Resources Manager Michelle Johannsen gave a quick overview of the budget. She said it was balanced with $7,594,700 in revenue and $7,525,200 in expenditures. Transfers amounted to $69,500 and an expected fund balance of 84 percent on April 30, 2021.

Then Village Clerk Lori Mitchell said there was a one-minute window during which to call in and offer comments on the budget. No one took advantage of that opportunity and the village board meeting began.

Revenue

Machesney Park’s primary sources of income are the sales tax and state income tax. Each is expected to bring in more money than during the current fiscal year.

Sales tax is projected to generate $3.450 million, a 1.4-percent increase over the $3.402 million that was budgeted for 2019-20. This was a good year for retail sales as the estimated revenue is $3.729 million. Of course, the actual amount won’t be known until sometime later in the spring.

More state income tax also is expected with a projected $2.256 million being generated, a 2.5-percent increase over the $2.200 million budgeted this year. The estimated revenue is $2.251 million.

The local use tax – a tax placed on goods purchased out of state – is projected to be $705,000 in the new year, or 9.3 percent over this year’s $645,000. This also was a good year for that tax as income was estimated to be $798,813.

This was another good year revenue-wise in the video gaming tax, which was budgeted at $180,000 but is expected to bring in $217,323. For 2020-21, that source is projected to generate $205,000, or 13.9 percent more than in 2019-20.

An indicator of the improved economy was seen in revenue received from building permits.

Back in 2017-18, that source brought in $113,135. It increased to $262,397 in 2018-19. This year the budgeted amount was $160,000, but it should generate $223,662. Since village staff is conservative when it comes to income, they are once again looking at $160,000 from this source of dollars.

Expenditures

Law enforcement services and public works are the primary expenses for the village each year.

Winnebago County supplies sheriff’s deputies to provide police protection and this year’s cost – $4.198 million – is 15 percent higher than the current budgeted amount, which is $3.652 million. The public works department budget is projected to be $1.694 million, which is a 7.6 decrease from the current expense of $1.834 million.

One of the costs of services to residents is snow and ice control. This one is always difficult to project because of the uncertainty of the weather each winter. This year’s budget is $283,000, which is 6 percent under the 2019-20 total of $301,000.

Comments

While no one called in to talk about the new budget, there were some comments made during the village board portion of the meeting.

Trustee James Kidd asked that action on the new budget be removed from the consent agenda and made available for discussion. He had three questions:

* A new line item, $17,600, for health insurance under the heading of mayor/village clerk?

Village Administrator Tim Savage explained said the village provides comprehensive health insurance for employees with the ordinance stating there are two positions – an elected clerk and an elected mayor – who may take that insurance if they so choose. In the past few years, he said the mayor (Steve Johnson) has not taken it. But this year (2020-21) he chose to take it.

* Is the police protection contract month-to-month, or annual?

“It looks like we budget for 12 months but are we going to concentrate on that,” Trustee Kidd asked. “Or do something in the future?”

Administrator Savage replied that the police contract historically has been an annual contract. But the village pays the amount on a monthly basis. “The amount you see there is what we are estimating to be the annual cost,” he said.

* Concerning the utility tax, is the village using it for investments or roads?

Savage explained that any time there are unused funds, the village invests that money “to get the greatest return we can on that. We wouldn’t want to park it and not get any return on it. So on an annual basis, we have that money building up, waiting to be spent.”