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'Painful' Budget Decisions Loom For Bloomington Aldermen

Mike Hill
Alderman David Sage has expressed concern about offering early retirement incentives in Bloomington.

Staring at a projected $3 million deficit next year, Bloomington aldermen will meet Saturday for a daylong retreat focused largely on right-sizing the city’s budget amid flattening revenues.

City leaders are using so-called “priority-based budgeting” to make decisions about the spending plan that begins May 1, 2018. During Saturday’s retreat, aldermen will look at a ranking of the city’s 160 programs, comparing higher priorities like EMS services with lower priorities like brick streets maintenance.

City Manager David Hales has suggested aldermen consider cutting entire programs. That’s because the $3 million projected budget deficit in Fiscal Year 2019 is only the tip of the iceberg, according to Hales.

Without action, that deficit will grow each year, to $8.5 million by 2022, caused largely by rising labor costs and flattening revenues from sources like sales tax and property taxes. (The city’s total budget is around $214 million.)

The city simply has too many programs supported by too few staff, Hales said.

“We’re facing significant structural imbalances in the years ahead and it’ll take significant and challenging tough political decisions to begin to avoid that,” Hales said during a council work session Oct. 16. “And it’s gonna be painful for us and the citizens as well.”

McLean County and the Town of Normal are dealing with similar deficits. Both have begun to address them through recently approved early retirement incentives to save money later. Budget shortfalls have forced the city to cut staff before; the city had 850 full-time equivalent employees in 2009, and that’s now at 750, Mayor Tari Renner said recently.

It’s unclear if Bloomington will consider early retirement incentives this time around. Some aldermen are cool to the idea. Ward 2 Alderman David Sage said he’s concerned about the upfront costs.

“And that becomes just a technique to kick the can down the road. If we lose staff because of an early retirement incentive, but we don’t do the right thing about reducing the services, then we’re not doing anything. It’s window dressing. It’s a charade,” Sage said.

Beyond cuts, one option for aldermen will be to raise property taxes. While property values have grown, the city has not raised its property tax rate since 2008, Renner said.

If Bloomington raised its property tax rate by 0.08 percent—matching the Town of Normal’s rate—the city would see an extra $1.6 million in revenue, according to a document shared with aldermen ahead of Saturday’s council retreat at Fox Creek golf course. That would mean the owner of a $165,000 home would pay, on average, $44 more in property taxes each year.

Bloomington residents and businesses could also see increased fees to offset the true cost of city programs. The city doesn’t charge businesses, for example, the first four times that police are sent out on a “false alarm” triggered by a security system, said Melissa Hon, assistant to the city manager. There were 329 false alarms in 2014, 232 in 2015, and 235 in 2016, she said.

“Priority-based budgeting is about what we want to keep,” Hon said. “What do we want to do? And what level of service do we want to provide?”

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Ryan Denham is the digital content director for WGLT.
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