Riverside’s village board on Dec. 3 approved its operating budget for 2016, one that is heavy on capital improvements and anticipates that expenditures in the general operating fund will outpace revenues by about $17,000.
The general fund shortfall, if the fiscal year ends as predicted, will be covered by cash from the village’s reserve, which at the beginning of 2016 is expected to be around $5.7 million.
The village anticipates taking in $9.17 million in revenues while spending about $9.19 million for general operations. The budget assumes an increase in revenues of a little less than 1 percent in 2016 over 2015.
This is due in large part to Illinois tax cap laws, which limit property tax levy increases to the rate of inflation as measured by the consumer price index (CPI) or 5 percent, whichever is less.
For 2016, the CPI is calculated at 0.8 percent, resulting in the village collecting roughly $35,000 more in property tax revenue year over year.
Meanwhile, general operating expenditures — including salaries and benefits for village employees, many of which are collectively bargained — are expected to increase by 5.2 percent in 2016 compared to 2015. Personnel costs represent about 73 percent of the village’s general operating expenditures.
Part of that increase in personnel costs includes a nearly 27-percent increase in the village’s contribution toward police pensions. In 2016, the village expects to contribute nearly $918,533 towards police pensions, which represents about 10 percent of total general operating expenditures.
Riverside Village President Ben Sells said that while contributions to the pension fund are sufficient to pay benefits right now, that could always change in the future.
“As we look down the line, all it takes is for people to start retiring,” Sells said. “That’s a big concern for us.”
Just five years ago, the village’s police pension contribution was about $620,000 — almost half what the village now is obligated to contribute toward police pensions annually.
The large spike in police pension contributions ought to be a one-time occurrence, however, said Finance Director Marco Salinas, due to a change in the way actuarial assumptions are calculated.
Riverside does not have a fire pension fund because its fire department is staffed by paid-on-call firefighters. The only salaried position is that of the fire chief, and he participates in Illinois Municipal Retirement Fund along with other non-police village employees.
The budget also calls for about $11.2 million in capital spending, a good chunk of it is related to projects that have received significant grant funding.
In the budget next year are improvements to the downtown train station, including its roof, totaling almost $1 million. Nearly the entire cost of the roof repair is being covered by two grants from the state of Illinois and Metra.
The Burlington Street downtown streetscape project and Burlington Street resurfacing, a $2.3 million project slated for completion in 2016, will be funded in large part by three grants totaling almost $2 million.
Riverside also plans on resurfacing Longcommon Road and East Quincy Street in 2016. The $1.42 million combined cost for that work is being funded in part by $838,000 in federal Surface Transportation Program grant funding.
Another $1 million in residential road improvements will be funded through the proceeds of bonds approved by voters in 2015 and by motor fuel tax funds.
The village is also planning on completing a $2.4 million storm sewer separation project that will benefit the area of Riverside west of First Avenue and the village’s First Division.
In addition, the village will replace a water main that crosses the Des Plaines River, abandoning one that is unable to be repaired. The village previously repaired two other water mains that cross the river. The water main replacement project will cost about $700,000.
All of the water and sewer improvements will be funded via the village’s water and sewer fund, an enterprise fund that collects revenue via water and sewer fees charged by the village to residents and business owners.
Even after the roughly $3.1 million in improvements slated for 2016, the water and sewer fund will still have a cash surplus of about $9.5 million, which will allow for additional water and sewer improvements in future years.
“The long-term goal is the separation of the combined sewer system,” Sells said. “The cost for that outstrips [the $9.5 million surplus].”