Wilmette plans to increase stormwater charges and strategic reserve spending to recover lost revenue from COVID-19
Getting in shape is the easy part. It’s staying in shape that is difficult.
Wilmette staff members presented village administrators with a mostly positive financial report on Tuesday, September 14, which included a 2021-to-date review and a 2022 snapshot.
But the village of Wilmette, like most municipalities, has suffered a financial blow from the COVID-19 pandemic and is finding ways to recoup $ 1.2 million in revenue it took out of its 2021 budget.
Financial Director Melinda Malloy and Deputy Village Director Erik Hallgren presented the directors with the financial outlook.
According to the presentation, in 2022 the village expects new revenues of around $ 800,000 from the tax levy and $ 240,000 from a new water account at North Maine Utilities – the village of Wilmette operates its own water treatment plant.
Malloy explained that the village plans to continue to increase stormwater charges for residents, which offsets the costs associated with the neighborhood storage project. Early estimates show a 31.4% increase, which works out to about $ 55 per year for an average Wilmette home. Stormwater charges jumped 31.6%, or an average of $ 42, in 2020.
In addition to the revenue increases, Wilmette plans to spend $ 5.24 of her reserves over the next four years. About $ 3 million in reserve spending has already been approved by the village, including $ 500,000 for pensions and $ 755,000 for road improvements this year.
The strategy aims to raise the village reserve level to 30 percent, a target set by village officials and within Moody’s high-quality financial rating standards.
The proposed expenses include pension contributions and investment projects, according to village documents.
Officials said if the village’s income continues to exceed budget forecast, more than $ 3 million in potential additional reserve spending has been identified.
The village is already setting this pace in 2021, according to Malloy.
After seven months, Wilmette is 4% over her income budget, according to documents. The funds are supported by a record number of real estate transactions (459) over seven months, Malloy said, adding that the annual average is 540.
Higher-than-expected income taxes and permit revenues also play a role in windfall revenue that could exceed the budget by $ 3 million by the end of the year, she said.
The spending also tells a good story, Hallgren says, but not all of it.
As costs move below budget, some deferred capital payments will catch up with the village, and he predicts the village will eventually go over budget by $ 640,000 – or 1.2% – in 2021.
One of the main reasons for the overspending is the $ 755,000 in additional road works approved by the village council in the spring.
The 2022 budget process began on August 30 at the committee level and continues through the fall until a budget and tax levy are presented to the village council in November and December, respectively.
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