Oak Park has seen the reality of sharp financial cuts in recent years, and after learning from past budget woes, village trustees agreed today’s budget must anticipate tomorrow’s challenges.
The cutbacks of 2009 and 2010 linger in most current financial discussions among board members as the group recalls the “painful process” that left the village without 20-25 percent of its staff. The village has recovered in the past few years and implemented new evaluation measures, like a performance management program, so the board has determined now is the time to look ahead in order to avoid future pitfalls.
Preliminary discussions about the 2014 budget began Monday evening during a special board meeting where trustees spoke bluntly about issues needing to be addressed. Trustee Ray Johnson said now is the time for the new board to dive into the budget to flesh things out.
“I don’t want to be the skunk at the picnic, but we have some structural issues in this budget,” Johnson said. “I think as a new board, with some new ideas and some new perspectives, this is a great time to figure out some of those structural issues — like pension and debt and future debt in regards to capital improvements.”
Trustee Peter Barber weighed in to ask how Oak Park has historically approached its budget and whether there is a better way to work with department heads so they can determine how to operate with less, regardless of what last year’s budget was.
“Is there another way of looking at that to say, ‘OK, here is the max we can go,'” Barber posed to the group, “within the departments almost a zero-base type of approach.” This, he said, means asking each department one question: “What do you really need this year?”
Because local governments typically set aside a certain portion for reserves and spend the rest, Barber suggested there is a way to encourage department heads to review each item of their budget to make more fiscally responsible choices.
That approach, however, has already been implemented in Oak Park, said Trustee Bob Tucker, who serves on the finance committee.
“That has been the process,” Tucker said. “I think we’ve been pushing back against that and challenging department heads to find and cut where they can, to the point it hurts sometimes.”
Trustees agreed that more input from individual departments — another dimension of the performance-management approach — is needed so the board can piece together what structural issues might still be overlooked. The board also collectively agreed that Oak Park is in good shape today, but the 2014 budget must prepare for long-term cost savings to address concerns like rising pension costs that are not being adequately funded by the state.
“I hope the direction to staff is to be thinking long term,” Tucker said.
When it comes to cutting back, Trustee Colette Lueck said there needs to be more strategic decisions of where cuts could and should come from. Again, she pointed to the new performance management program.
“We need to find out where do people still have a little meat on the bone … particularly in places that earn us revenue,” Lueck said. It’s important, she added, for staff to have a clear understanding of achievable goals because right now there are conflicting messages being conveyed. Staff has been directed to not increase taxes but also address long-range funding holes, Lueck said. They’ve also been told to streamline processes but also find ways to invest money without spending money.
President Anan Abu-Taleb focused his comments on what he’s been preaching since the campaign, which is eliminating wasteful spending. This also means addressing economic realities like rising pensions that have the potential to cripple local governments. Oak Park has kept up with its pension obligations, but a shortfall from the state poses serious challenges for future budgets.
“We can’t pretend they are not there,” Abu-Taleb said. “We need to do everything we can to be responsible.”
Johnson and Lueck also spoke of pension challenges, saying Oak Park can’t bank on Springfield making necessary changes, especially in light of the unsolved pension debate ongoing at the state capitol. Johnson said it’s important the board get a “much longer view” of what pension issues Oak Park faces.
“There is a window where we have to work with communities to change legislation,” Lueck emphasized. “Unless it changes, this is a recipe for disaster.”
Before the meeting closed, Village Manager Cara Pavlicek reviewed what she called a “fiscally conservative timeline” to review the 2014 budget. The next stages includes meeting with departments to provide budget training, a review of funding requests, reviewing updates with the finance department, and conducting budgeting hearings with each department. Overall, Pavlicek laid out a 15-step process that has the finance committee doing final tweaks in October, which would bring the budget to the village board by early November, ready to adopt by early December.
