The village of Brookfield general operating budget ended 2018 at a greater deficit than first estimated, according to the audit of that fiscal year, which was released July 5.
Expenditures outpaced revenues by a shade under $762,000 in the general operating fund, which pays for day-to-day expenses like village employee salaries and benefits. Earlier this year, village officials had estimated that the general fund ended 2018 at a $566,000 deficit.
Brookfield Finance Director Doug Cooper pointed to a couple of factors that helped grow the 2018 deficit, including a large transfer from the general fund to the debt service fund, which he called “the biggest component of the difference.”
Another big reason for the general fund shortfall in 2018, said Cooper, were expenses related to getting West Central Consolidated Communications (WC3), the new centralized police/fire dispatch center serving Brookfield, Riverside, North Riverside and McCook, off the ground.
“WC3 really caught me off-guard in the budgeting process,” Cooper told members of the village board at their July 8 meeting. “Compared to budget we were actually down about $450,000.”
Cooper said he assumed the village would still be getting the E911 surcharge fee levied on locally registered phones until the center officially opened, about halfway through 2018.
However, the village lost that revenue stream as of Jan. 1, 2018. At the same time, Brookfield was still paying dispatchers it employed until the central dispatch center went live. There was also a large equipment component for launching WC3 that Cooper also hadn’t accounted for.
“Those were unbudgeted costs,” Cooper said.
Cooper added that WC3 did receive a state grant to help the member villages recoup some of the capital costs and may receive additional state funds in the future.
“I did not budget appropriately for that particular [line item] and that’s where the financial position for the village bit the dust, so to say,” Cooper said.
Cooper also said the village sustained three unexpected workers’ compensation claims in 2018, which resulted in the village spending about $117,000 more than expected, the village also incurred additional legal costs related to staffing turnover last year.
Brookfield experienced a revenue shortfall in the area of building permits, where fee increases expected to go into effect in early 2018 didn’t go into effect until mid-summer. The budgeted revenue for building permits came in about $100,000 short as a result, according to Cooper.
“We lost all that up-front revenue when people are in the process of beginning all of their construction projects,” Cooper said.
It’s the third straight year Brookfield has reported a general operating fund loss, and the village’s cash reserves have now dipped below $2 million for the first time since 2011.
Village policy calls for keeping 25 percent of annual expenditures in reserve. But, with reserves standing at $1.77 million versus general fund expenditures at $17.7 million, cash reserves at the end of 2018 represented about 10 percent of total expenditures.
Earlier this year, local officials responded to the budget squeeze by enacting a series of fee increases – for parking tickets, vehicle stickers, business and liquor licenses, contractor licenses and ambulance fees.
The village also imposed a 1-percent places of eating and drinking tax in order to collect more revenue. The moves were expected to generate about $800,000 annually in new revenue.
The 2019 budget passed by the Brookfield Village Board earlier this year includes those revenues and predicts a general operating surplus of about $100,200. However, that surplus is being achieved by making a $600,000 transfer from the motor fuel tax fund to the general fund, something Village Manager Timothy Wiberg said he wants to stop doing in the future.