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Normal To Be Cautious In Planning Post-COVID Budget

The Normal Town Council meets remotely Tuesday, Sept. 8.

Normal and other cities shouldn’t expect a full economic recovery until 1 to 3 years after a COVID vaccine becomes available, administrators told the Normal Town Council on Tuesday.

In the meantime, finance staff said Normal will take its stable financial position and proceed with a cautious approach. 

Finance Director Andrew Huhn shared the 2019-2020 Financial Trend and Condition Report during the council’s remote meeting. The report looks at six categories: community, revenue, expenditures, debt service, balance sheet and financial strategies. He noted most indicators were relatively unchanged from the previous year’s report. However, that was all pre-COVID, he said.

“We ended the year with a strong surplus -- about $1.9 million in the general fund,” said Huhn.

After the pandemic hit, Normal projected a $6.2 million deficit, he said. Although Huhn expects the deficit now to be much less severe, barring more devastation, he said the town also needs to plan for lingering negative effects. Contingencies likely will get swallowed up, he noted. 

“It’s going to be at least 1 to 3 years before you get back to kind of, pre-COVID budget, or pre-COVID activity,” he said. 

In his year-to-date update on general fund COVID estimates, Huhn told the council that, through July, the town’s actual revenue was $451,000 better than projected with the adapted COVID budget. Expenditures were $3 million better than expected.

While the economic outlook of the COVID-era remains in question, how Normal handles its finances does not. On Tuesday, the council adopted an independent auditor’s report that gave the town the highest Government Accounting Standards Board (GASB) rating, known as an "unmodified opinion."

Jamie Wilkey, a partner with Lauterbach & Amen--the CPA firm that conducted the audit-- praised Normal’s financial staff's preparation of the audit.  She said auditors found the report to be clean, with "no findings, no internal control issues," said Wilkey.

She cited the town's established finance policies and the staff’s conscious efforts to follow the policies as exemplary. She said that’s not always the case with other municipalities.

Wilkey noted the audit covers only through March 31, 2020--and so doesn’t include the impact of the pandemic. The strong performance within the general fund prior to that only helps Normal moving forward through the pandemic, she said. The comprehensive annual financial report shows Normal’s general fund with about $33 million in unassigned fund balance, or enough reserves to cover nearly 7 months of operations. That, too, isn't always the case for municipalities, she said.

For the prior year's comprehensive audit, Normal was awarded the Certificate of Achievement for Excellence in Financial Reporting. Wilkey said she planned to submit this year's report as well.

Eagle’s Landing Trail project  

Also on Tuesday, the council awarded a $280,735 contract to Pontiac-based H.J. Eppel and Company to construct Constitution Trail extensions in northeast Normal. 

Work is set to begin this month on the Eagle's Landing Multi-Use Trail Project that links nearby neighborhoods to Grove Elementary School and Normal Community High School. 

The state’s Department of Commerce and Economic Opportunity (DCEO) awarded Normal a $500,000 grant for the extension projects, including money for a $125,000 project near Underwood Park that’s already completed.    

Motor fuel tax consideration

Prior to Tuesday’s meeting, the council met in a work session to consider raising Normal’s local motor fuel tax from 4 cents per gallon to 8 cents per gallon, as part of planning for the fiscal 2020-2021 budget. 

Huhn said the town brought in about $1 million from the tax last year. If Normal approved the increase, the town could generate another $1 million each year. 

He noted neighboring Bloomington raised the tax from 4 cents to 8 cents per gallon in May 2019, and had favorable results, with the average prices for gasoline there not being raised.

The council discussed the idea for about an hour, eventually agreeing in an informal vote to have staff bring an ordinance proposal to a future meeting, for more discussion. 

In other business, the council:

  • Approved spending up to $250,000 on a water system analysis and project design for future town growth. Crawford, Murphy & Tilly will oversee the design and analysis that is expected to be completed by April 2021. 
  • Approved spending about $62,000 on aeration fountains for pond maintenance. The Otterbine industrial aerators come from MTI Distributing. The council OK’d waiving the formal bidding process, based on the town having bought similar aerators from MTI at a similar price.
  • Heard Mayor Koos’ recommendation to change public comments at council meetings to a different format. He suggested comments about the night’s topics could come at the beginning of each meeting, and any general comments could come just before the meeting’s end. 

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Michele Steinbacher is a WGLT correspondent. She joined the staff in 2020.
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