City of Champaign Proposes Balanced Budget for Fiscal Year 2012/13

As Economy Shows Signs of Recovery, City Invests in its Future

Champaign City Manager Steve Carter and Finance Director Richard Schnuer will hold a media briefing to present the City’s proposed budget for FY 2012/13 on Tuesday, May 1, at 4:00 p.m. in the Council Chambers (1st Floor of the City Building at 102 North Neil Street, Champaign). The post Council Study Session will be held that evening, May 1 following the Regular Council Meeting, when City staff will make a formal presentation of the proposed budget to the City Council. The City Manager and Finance Director will respond to questions from the press at the 4:00 p.m. briefing.

The City Administration has prepared a balanced budget proposal that preserves critical services and restores some funding to key service priorities that have been impacted by budget reductions in recent years. The City Council has adopted close to $17.7 million in proactive budget balancing measures since FY 2008/09, most of which have been expenditure reductions. City Manager Carter stated “The City Council’s willingness to make tough decisions over the past few years has put our City in a strong position to move forward as the economy grows. Many communities are still struggling under the impact of the economic downturn. In Champaign, we are making important investments in our infrastructure, core services, and quality of life in a way that will distinguish us from other communities.”

The Proposed Budget for FY 2012/13 anticipates slow growth in revenues. However, to remain in a financially sound position over the long-term, the FY 2012/13 budget balancing strategy includes $392,102 in recurring expenditure cuts from all City departments, significantly fewer reductions than in recent years. According to Finance Director Richard Schnuer, “Many signs show the economy recovering at the local, state, and national levels. Most City revenues have stabilized, and careful fiscal planning combined with strategic budget balancing measures have served the City well. While past years’ service reductions have been difficult, we are now at a point where we can reinvest in key priorities and still recommend a balanced budget.”

At the end of last fiscal year, the City realized greater increases in one-time revenue receipts than anticipated when the FY 2011/12 budget was prepared. In addition, actions taken by the City to reduce one-time costs, such as keeping City positions temporarily vacant, resulted in greater savings than expected. The combination of increased revenues and savings has allowed the City to build additional investments in capital improvements, public safety, economic development, and quality of life priorities into FY 2012/13 budget. These include:

  • $750,000 one-time transfer from the General Fund to Capital Improvements Fund to restore a portion of prior year budget reductions
  • $508,190 in funding for future 800 MHz Radio Replacement for Police, Fire, and Public Works for continued interoperability functions ($101,638 recurring and $406,552 one-time)
  • $142,201 METCAD User Fee increase to support 911 call center functions for Police and Fire
  • $200,000 one-time Economic Development funding to restore a portion of prior year budget reductions
  • $250,000 transfer from the General Fund to the Library’s Capital Fund to help pay for replacement of worn carpeting and to reupholster furniture throughout the buildings
  • $100,000 contribution to the Summer Youth Employment Program ($20,000 recurring Administration costs and $80,000 one-time for youth placement)

The proposed budget includes no additional revenue proposals but the adopted budget will include revenues previously approved by the City Council this year. Council approved a four-cent per gallon Local Motor Fuel Tax and a Stormwater Utility Fee that will be used to invest in crucial road and drainage improvement projects. The Local Motor Fuel Tax will restore 75% of the recurring funding that was cut from transportation funding in recent fiscal years, with $1 million designated for arterial street improvements and $500,000 to street reconstruction projects city-wide. The Stormwater Utility Fee will allow the City to complete key flood prevention projects that would have waited until 20 years from now without additional funding. The City Council will determine project priorities over the next coming year, which could include the Boneyard Creek north of University Avenue, the West Washington Street drainage basin, and the Phinney Branch drainage basin. Both of these new revenues are included in the 2011-2013 Council Goals to provide important infrastructure investments that address the health, safety, and quality of life of City residents, businesses, and visitors to the community.

The Champaign Council adopts a balanced budget every year and follows sound financial practices to ensure continuation of high quality services. The City also has a number of conservative financial policies that served as safeguards against drastic, emergency cuts required by some cities when revenues fell short of projections. These policies include budgeting recurring expenditures at 98.5% of recurring revenues, and maintaining an unreserved General Fund balance at a minimum of 10% of operating expenditures. The FY 2012/13 budget includes an undesignated fund balance of 10.12% or $4.5 million, which represents about one month’s General Fund expenditures. Also, included are designated reserves of $769,222 for the 27th pay date and $620,253 for City facilities.

A copy of the complete proposed budget document will be available for review on May 2nd at the Finance Department (2nd floor of the City Building) during normal business hours (Monday thru Friday from 8 a.m. – 5 p.m.), at the reception desk at the Champaign Public Library, and will also be available on Budget Division Page of the City’s Website.