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Politics & Government

Palos Hills Passes Budget, Still Cautious About State Cuts

Despite passing a balanced budget and keeping the city financially healthy through recession, Mayor Bennett said LGDF cuts will be too much sacrifice for future budgets.

With legislation that could looming, Palos Hills Mayor Gerald Bennett said the city is currently in good shape, but future budgets are questionable until possible action down state is clear.

“The budget generally shows around a two percent increase in expenditures each year, due mostly to insurance premiums, pension obligations and other costs we don't have a lot of control over,” he said.

The city presented and approved a balanced budget in the amount $7,011,592 at last week's council meeting, which reflected the new contracts with both the and, but Bennett said also reflects the actions of a city that has already made some difficult cuts over they past few years.

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“We're down four police officers right now, and it cost roughly $100,000 (including pension contributions) for each officer,” he said. “So your talking about $500,000 (in expenditure cuts) right there.”

At last week's meeting, Ald. A.J. Pasek (3rd Ward), chair of the Finance Committee, said that creating a balanced budget in the future that might not be easy to do.

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“Hopefully the state doesn't discount or discontinue [] or we're going to have to have a really big meeting and discuss a lot things because I've gone through this in my mind … there is a lot of stuff that will have to take place at that time,” he said.

Pasek went on to say that 10 years ago he had suggested “making some cuts, around 10 percent that would've been painless, but if it happens now it will be painful for a lot of people in all the departments.”

Bennett argued that reductions were made, and that most of the increased costs came from pension and health insurance costs which he said were "out of our control."

Bennett said like most municipalities around the state, Palos Hills has shown slow to neutral growth on the revenue side, but is faring better than other communities that rely more on retail sales tax revenue. He said the city's mixed, balanced revenue helped it during the recession.

Other changes that have helped keep the city in the black include 25 years in the Southwest Central Dispatch (SWCD) which handle emergency and non-emergency calls for almost 20, local police and fire departments.

The city also has electronic reading of water meters and refuse collection is handled by Waste Management.

“Operational changes like those really help with cash flow, which is a big problem faced by municipalities,” he said, adding that about 85 percent of the budget is for operational expenses.

Bennett also said that the city's property tax rate is less than half what is was 30 years ago, and over that time they made only cost-of-living increases and did not raise rates as home values increased.

Because Palos Hills is a non-home rule community, the city is limited in their ability to seek increased revenue from sales, use and property taxes.

Bennett said Palos Hills also has no General Obligation , which are municipal bonds backed by tax payers. From a budget standpoint, that means no revenue from tax payers is used for bond payments.

Bennett said for as long as he has been mayor, he has used a zero-based budget system, starting from scratch each year when figuring the budget, and also said that every council member gives their input and suggestion on the budget.

While he said he was pleased with this year's budget, Bennett made it clear a loss of LGDF will be catastrophic and impossible to make up from the revenue side – services will be cut.

“We've kept a balanced budget [during lean times] but a major hiccup now would be a major disaster,” he said.

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