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City staff presented the City’s third-quarter Financial Report for fiscal year 2010-1, and the news was not all bad. In fact, if not for an over-estimate of about $700,000 in anticipated revenue from the purchase of yard-waste stickers, the City would be well under $1 million in the red.
The sticker drain puts the City close to $1.5 million off budget, however, heading into the final three months of the last March-through-February fiscal year.
Although the final quarter could present some surprises of its own, one surprise that will not emerge is a sudden uptick in yard-waste sticker purchases.
Yard waste will not begin to reappear until late spring, and the City can close the books on the program safe in the knowledge that it seriously overestimated what citizens were willing to spend to have leaves, branches and lawn clippings hauled off by the City.
The overestimate, about $950,000 as opposed to $150,000 actually collected, said Administrative Services Director Joellen Earl, created a gaping hole in the City’s revenue stream in a year in which other estimates appear to have been close to spot-on. (The extra $100,000 was made up by greater-than-anticipated purchases of wheeled yard-waste carts.)
Real estate taxes, sales taxes and other revenues that depend in part on the state or Cook County, may arrive later than anticipated. Nevertheless, the numbers appear for now to be on target, with budgeted and expected collections tracking fairly closely to actual receipts.
Barring unexpected increases in revenue, the City expects to fall about $1.5 million short, said Ms. Earl. With a fund balance of more than $13 million, the City could make up the difference out of reserves, she said, and still have a balance of over $11.5 million.
The City is required to have reserves of 10 to 12 percent of discretionary budget, or about $8.7 to $10.5 million, and payment of the shortfall out of reserves would leave more than enough remaining.
Council voted to accept the financial report, and now awaits two things: final numbers for the fourth quarter, including sales taxes for holiday purchases and vehicle stickers; and the weather, as inordinate snowfall could significantly increase snowplow and overtime costs.
The race toward final revenue-versus- expenses looks especially close this year.