A precedent-setting $395 million 2023 budget was unanimously approved by Evanston’s City Council Monday, Dec. 12, and includes a plan to put public safety pension contributions on a 100% funding track this year.
The pension decision, which tackles head on one of the city’s biggest fiscal challenges, will mean the city uses $4.49 million from General Fund reserves. In the original budget proposal, City staff had recommended pensions be funded at the 90% level.
Members of the city’s Finance & Budget Committee, only in its second year, joined representatives of the police and fire pension boards to convince other Council members that the time was right to use the reserve funds – which are beefed up by federal COVID dollars and therefore at their healthiest point in years.
But this funding option is only in place for one year. And some city finance officials, including David Livingston, chair of the Finance & Budget Committee, had warned late last week in an interview with the RoundTable that using reserves is not a sustainable approach and that not all the forecast scenarios had been worked out.
Still, three of Livingston’s colleagues on the Committee, City Council Members Clare Kelly, 1st Ward; Melissa Wynne, 3rd Ward, and Jonathan Nieuwsma, 4th Ward, voted for the budget and the 100% funding of the pensions.
“I’m very proud of this City Council for taking the fiscally responsible high road and finally changing course by voting to fully fund our public safety pensions,” said Kelly.
“It has been many decades that the City of Evanston has underfunded our public safety pensions,” she said. This “has led to an exorbitant outstanding debt for Evanston residents impacting the City’s [credit] ratings and incurring huge costs to residents in the form of interests and fees. … This is an historic moment.”
Timothy Schoolmaster, the longtime president of the Police Pension Board, and often in the past a lone voice about the effect unfounded liabilities have on taxpayers, also saluted officials.
“As with all compulsive and addictive behaviors, such as alcohol or drug addiction, or compulsive credit card spending, the first step is always the most difficult, and you are to be commended for recognizing the problem, and deciding to do something about it,” Schoolmaster said in a statement.
“Properly followed up in future years, this sea change can only provide monetary relief to taxpayers, and may stop the warning shots fired across the City’s bow for some years now by the bond rating agencies.”
At the meeting, Council members approved a flurry of other spending moves, taking advantage of the city’s rosiest financial picture in years.
Fifth Ward Council member Bobby Burns proposed the transfer of $2 million from the real estate transfer fund into reparations, bringing that fund’s total to $3 million.
Earlier in the budget process, officials had expressed concern about a funding source for reparations initiatives, addressing housing and economic disparities for Black Evanston residents who were victims of past racial injustices.
A tax on local cannabis sales, which officials were banking on to fund the first $10 million of the program, has been producing less than expected revenue, a staff report found.
Council Member Tom Suffredin, 6th Ward, missed the council meeting because his two young children were sick.