FY 2019 Budget Builds Foundation for the Future

Urbana Mayor Diane Marlin’s proposed budget for fiscal year 2019 includes significant steps to lay a sound foundation for the City’s future. The proposed budget is available at https://www.urbanaillinois.us/departments/finance/financial-reports/annual-budget.

“Our staff is committed to providing excellent core City services, despite tighter budgets. However, we must make thoughtful and strategic decisions to address our long-term funding needs,” said Mayor Marlin. The budget includes $45.8 million in expenditures and $43.6 million in revenues for all City funds. Expenditures exceed revenues primarily because of large one-time expenditures in capital improvement funds.

Increased economic development activity will lead to more stable finances in the long-term as property values increase. Over 73,000 square feet of building space were added from January through April 2018, outpacing the last three years for the same months. To date, 38 projects, containing 85 units, have applied to receive THINK URBANA incentives for residential development in the Enterprise Zone. Twenty commercial projects are underway in the Enterprise Zone at a private cost of $10 million. These projects are expected to result in 162 new and retained jobs in Urbana. The City currently has four active agreements for renovation of existing building in the Central Tax Increment Financing District that are leveraging over $4.4 million in private investment.

To address long-term financial concerns, the Mayor is recommending restoring adequate funding levels for Police and Fire pensions based on a new pension funding policy. Progress also is being made on addressing the City’s structural deficit, largely due to significant budget reductions. “We are facing these challenges head-on and we are making significant progress in addressing them.” said Mayor Marlin in her budget message. “We also continue to work to rebuild city reserves.”

Most user fees will increase modestly to keep up with the City’s cost of doing business. Downtown parking meter rates will increase to 50-cents per hour, and a portion of this revenue will be used to offset the cost of landscape maintenance activities that keep the downtown area attractive for residents and visitors. Meter rates will increase in the area roughly bounded by University Avenue, Cedar Street, Urbana Street, and Illinois Street. Parking will remain free on evenings and on weekends.

Reductions were necessary to balance the budget. These reductions will reduce staffing by 4.7 full-time equivalent employees (FTEs) from the current budget, including two positions that were eliminated as part of voluntary separation incentives offered earlier in this fiscal year.

• The Urbana Civic Center opened in the early 1970’s. It is operating at a loss of approximately $40,000 per year and has deteriorated to the point where it can no longer continue operation in its current condition. Necessary repairs would require an additional expenditure of $750,000 to $1 million. Because that is not possible at this time, the Civic Center will close on December 31, 2018, and staffing will be reduced by 1.75 FTEs. Future use of this facility will be evaluated as part of the Facility Planning study, and the City will refer regular customers to other local meeting venues.
• The City will create a system for sharing the cost of information technology services among City funds, which will reduce expenditures in the General Fund by $220,000 on an annual basis.
• Funding for The Urbana Free Library will be reduced by $55,400 annually, which is proportionate to reductions in the City’s General Fund. Specific reductions will be determined at the Library Board’s discretion.
• A vacant part-time (0.45 FTE) Fire Prevention Inspector position will not be filled, and initial inspections will be performed by Community Development Services Department staff, who will report results to the Fire Department. This will save about $35,000 annually.
• The Human Relations Officer position has been staffed at half time for several years, and the budget will be reduced to match the actual staffing level. The reduction is 0.5 FTE, saving $36,000 annually.
• The City will lease approximately 50 passenger vehicles and pick-up trucks, rather than purchasing them outright, transitioning to the leased vehicles over the next few years. This is expected to save about $70,000 annually because funds currently reserved for purchasing replacements can be used to address the budget deficit.
• City departments have proposed line item reductions totaling $75,000 annually.

Other reductions are detailed in the Mayor’s budget message, which is included in the proposed budget document. Reductions total $623,000 on an annual basis.

There are very few additions to the budget. They focus on increasing productivity, efficiency, or customer services. Those additions include implementing new software for employee scheduling and time entry and licensing activities, and an update of the City’s website.

The City welcomes input on the proposed budget. A public hearing will be held in the City Council Chambers on Monday, June 4 at 7 p.m. Public participation is welcomed at all City Council meetings.