Though a skimpy balance in the general fund is a source of concern for two of the village’s top administrators, the account is actually healthier than it was only a few years ago, having grown by more than $600,000 since 2004.
But a tighter than expected budget this year prompted draw downs from other funds, leaving the village strapped for cash as the fiscal year closes out.
At the start of the fiscal year, Forest Park held $1.9 million in its general fund, which functions as a sort of savings account for the municipality, according to Finance Director Judy Kovacs. That figure has dipped and climbed in recent years with a low of $848,400 in April 2004 and a high of more than $2.2 million in April 2006. The village’s fiscal year runs from May 1 to April 30.
Since 2004, much of the money in the general fund has been committed to various expenses, including debt payments, giving the village a significantly smaller amount of unrestricted reserves, said Kovacs. Of the $1.9 million on hand roughly a year ago, only $226,500 of that was not tied up by incoming expenses. With the close of the fiscal year coming at the end of the month, it’s not yet clear how these numbers might change.
“A couple years ago it was negative,” Kovacs said of the unrestricted balance in the village’s general fund. “But $226,000 isn’t much.”
Last month Kovacs warned village council members that if department spending continues over the final 30 days of the fiscal year as budgeted, Forest Park could be saddled with a deficit of more than $1.6 million for the year. Revenues over the last 12 months did not come in as originally projected, said Kovacs, and higher than expected costs in several departments have further jeopardized the village’s yearend totals.
Kovacs said she is refiguring her projections based on the latest receipts – as she does every month – and can almost promise that her bottom line calculations for the fiscal year “will be better, but I have no idea how much better.” It’s highly unlikely, she said, that the village will end the year in the black.
Village Administrator Mike Sturino and Commissioner Rory Hoskins, who oversees Kovacs’s department, recently downplayed the finance director’s projection and pointed to a similar prognosis made this time last year. In March 2007 Kovacs suggested the village would see a $1.1 million debt at year’s end and, although the balance was written in red, the actual deficit was much less severe.
Shoring up Forest Park’s unrestricted cash reserves in the general fund are much larger balances in two of the village’s other major funds.
At the start of the current fiscal year, Forest Park also had some $900,000 in the water fund and $3.1 million in the parking fund that could be spent at the discretion of public officials. Traditionally, said Kovacs, money in these funds is earmarked for expenses related to their respective titles. There isn’t, however, any binding obligation that prevents the municipality from spending these reserves elsewhere, and all three balances are rolled into a single checking account.
As of April 30, 2007, the village held more than $4.2 million in unrestricted cash reserves, according to a list of fund balances provided by Kovacs. As of the end of March, that total was down to $3.2 million.
“Most of that is due to revenues not coming in as expected,” Kovacs said.
A spreadsheet given to commissioners as part of the March financial report shows that “miscellaneous” revenues account for $5.3 million, the greatest portion of the village’s anticipated income of $25.6 million. But as of Feb. 29, only 58 percent of those revenues had made it into village coffers and Kovacs was projecting to actually receive less in miscellaneous revenues compared to the previous year.
Annual revenues from ambulance services, waste removal and traffic fines – all of which help comprise the category – is something of a crap shoot, said Kovacs. The village had also expected to receive some money for the sale of several acres on the west side of town to the West Cook YMCA, but nothing has formally changed hands. Public officials also anticipated an up tick in cash flow with the installation of several traffic cameras to catch motorists running red lights. Those systems are yet to be installed.
“It hasn’t been a fundamental problem,” Kovacs said of the likely deficit. “We have good years and we have bad years, like most companies. This happens to be a really bad year.”