|
|
The 2024 budget season began on April 11 when the county board approved the budget calendar. Preliminary department budgets were due on May 26 with the deadline for final department requests on June 29. We continue to work with departments to refine their requests and to assemble them for presentation. The county board will get its first look at the General Fund requests on July 25. The Highway Department and Public Health Human Services will make their presentations before the board in August. The county’s preliminary budget is expected to be adopted on September 12, well ahead of the September 30 state deadline. The county’s final budget and levy is scheduled to be approved on December 12, leaving room for any needed adjustments before the final state deadline on December 28.
The county board conducted a compensation study in 2022 to address issues in hiring and retention of employees. The study showed county wages falling behind a group of benchmark counties selected for the study based on similar economic characteristics such as median home value. The increase that was approved puts significant pressure on the county levy. The state provided some help in the recently ended legislative session. We will receive a significant increase in county program aid, from $516,000 to around $674,000 (the state is still working on formula details). The state-payment in-lieu of taxes (state PILT) also increased. We receive state PILT payments on both a dollars per acre and a percentage of appraised valuation, depending on the category of state land. The formula for the largest block of state land in the county increased from $2/acre to $3/acre under the new law. This resulted in about $134,000 in additional funds we use to offset the levy. We also received an increase in one of our three federal payments-in-lieu of taxes (PILT) payments. The payments we receive under Section 6902 increased $94,495. The 6902 PILT payment is limited by our low population and the deduction for payments we receive under the Thye-Blatnik (BWCA) Act. The total increase in these three state and federal payments is $386,495. An even larger source of potential help with the county budget are payments from the American Rescue Plan Act (ARPA). We received $1,061,124 in ARPA funds in 2021. Those funds were allocated for affordable housing, expanded broadband, pandemic response, and behavioral crisis issues. But late in 2022 we received surprising news that we would be receiving another block of ARPA funds called the Local Assistance and Tribal Consistency Fund (LATCF). Those funds total $2,039,903. We received the first half of those funds in November 2022 and in February 2023 the board allocated $700,000 of those funds toward the HRA’s affordable housing projects. The second half of the LATCF funding will be sent later this year. The remaining $1.3 million is available for other priorities including levy relief.
The county’s financial indicators remain strong. Local option 1% sales tax collections continue their climb. 2022 showed an 11% increase over 2021 and 2023 collections to date are at a 7.8% increase. Lodging tax collections have cooled slightly since their covid surge in 2021 but remain about 27% above pre-covid numbers. Unemployment numbers have stayed within the 2.5% to 5% range over the past two years, with our winter peaks and summer lows. The projected U.S. inflation rate for 2023 has dropped to around 3.5%, compared to the 8% increase we saw at this time in 2022. And most economists have been surprised by the strength of the US economy given the Federal Reserve’s interest rate hikes. Consequently, their predictions of a near-term recession have largely disappeared.
The other large factor in budget discussions this year is the county’s capital improvement plan (CIP). The plan was completed earlier this year and shows $13.5 million in deferred maintenance for county buildings over the next five years. The plan also gives options for dealing with county department space needs. The county board has expressed strong support for quickly tackling the deferred maintenance of key buildings but has not yet approved the CIP, including one of the options for addressing space needs. Any decision the board makes on the capital improvement plan this year will likely require bond issuance this year or next year. The payments for those bonds will likely start in 2024 and will add to the county’s budget and levy.
County Connections is a column on timely topics and service information from your Cook County government. Cook County – Supporting Community Through Quality Public Service.
Leave a Reply