Normal Projecting $10M Hit From COVID-19 | WGLT

Normal Projecting $10M Hit From COVID-19

May 4, 2020

Projections made by the Town of Normal’s finance department anticipate a $10.4 million loss in the general fund, but officials say a strong fiscal position entering the pandemic will enable the town to get through the economic downturn.

Finance Director Andrew Huhn provided the outlook during a work session prior to Monday night’s regular online council meeting. He said the town still has “a strong balance sheet.”

“Right now we are in a good fiscal position; we have plenty of working capital to resolve this issue in kind of a thoughtful way,” said Huhn.

The adopted budget anticipated general fund revenue of $69.9 million, but the new outlook figures the total at around $59.5 million. Huhn said 80% of the decline comes from several hard-hit revenue sources, particularly sales tax, food and beverage tax, income tax, hotel/motel tax and motor fuel tax.

The projections were based on conservative modeling with the assumption that the current shutdown continues through June, although hope remains the state’s shelter-in-place order will expire at the end of May.

“We wanted to get kind of a best a worst-case scenario as possible to see what the impact might be for our own planning,” said Huhn. “It’s hard to predict when we will fully recover from this.”

Noting that getting the economy restarted won’t be simply turning a switch back on, Huhn said the projections do not predict a total recovery by the end of the  town's fiscal year.

He said the staff has taken immediate steps to offset the deficit to “shore up the working fund’s capital position” mainly by reducing or eliminating some transfers from the general fund to other town accounts.

City Manager Pam Reece said the town likely will delay some capital projects, such as planned Maxwell Park upgrades, to help cover the anticipated losses. But she echoed Huhn’s belief that Normal remains on solid financial ground.

“We entered into this crisis in a very strong financial position primarily because council has established our target fund balances,” Reece said. “The purpose of those fund balances is for a rainy day; this goes way beyond a rainy day, but at least it provides us some cushion and allows us some time to be thoughtful in our approach – not completely reactionary.”

State Rep. Dan Brady, R-Bloomington, also spoke during the work session, discussing a possible regional approach to reopening the state.

“Everyone is pushing to get business back open to some degree, shape or form,” Brady said. “I am cautiously optimistic that we can find common ground area, we can get business reopen before May 30 to some degree across the state.”

The work session also included discussion on the possibility of Normal providing emergency medical services to Hudson. The town currently has a similar coverage agreement with Towanda.

Rivian Tax Break

The council voted to approve its share of 2019 property tax breaks for Rivian, agreed to as part of a 2016  economic incentive pact. Normal's portion is expected to total around $106,000 (town and library).

Earlier Monday, the startup electric automaker announced it would decline a $1 million grant from the town that it earned by meeting hiring and investment thresholds.

“There’s not a ton that a pre-production company can do during a global pandemic,” said Rivian communications director Zach Dietmeier. “But we want to be as faithful to the partnership that we have with the Town of Normal. We are so appreciative of the support and the patience.”

Marie’s Place Licenses

Before the regular meeting, the liquor commission unanimously approved liquor and gaming licenses for the new owners of three Marie’s Place locations. The move reverses last month’s decision revoking licenses the establishments had under previous management.

Tyler Carlson, who owns Prairie Fire Grill in Heyworth with his wife Brittany and partners Russ and Lisa Maas under the corporate name MC One Investments, said the group plans to offer its menu of hand-crafted pizzas at the gambling businesses.

“As we’ve looked to continue to expand our operation, we felt this is a great opportunity to bring what we feel is the best pizza recipe in all of central Illinois to the town of Normal,” said Carlson.

The new licenses were approved for existing locations at 1520 E. College Ave. and 115 Susan Drive, as well as a yet-to-open store at 1702 W. College.

Other Business

The town will save about $382,000 on this year’s part of a five-year plan for sewer repairs. The council approved a $452,000 contract with Hoerr Construction for 2020 sanitary sewer lining replacement; the town’s budget anticipated an $834,000 expense.

Other agreements approved include: a $46,500 pact with Rowe Construction to resurface the Belt Avenue bridge; a $32,000 deal with Wisconsin-based American Litho to print activity guides for the parks and recreation department; a $28,000, three-year annual contract with Kone Inc. for elevator maintenance; and renewal of the Municipal Insurance Cooperative Agency Insurance Program.

The council also approved a final plat for the Iden Subdivision at 105-111 W. Locust St., where the Iden family plans to build a five-story student apartment building on three lots to replace existing apartments. A zoning variance for the project was approved in February.

Finally, the council initiated a zoning text amendment for the One Normal Plaza planned unit development – the former Illinois Soldiers and Sailors Children’s School. The new zoning aims to encourage development at the site, including a possible microbrewery. Stan Nord voted against the procedural step.

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