With people buying fewer homes, less stuff at the store, and unemployment up, the Village of Oak Park is taking in less tax revenue. So it’s attempting to make $1 million in cuts to its budget before the end of this year.
The first round of those cuts were made Monday, as trustees green-lighted the layoffs of five employees in public works, a restructuring of the Oak Park Fire Department, and 10 percent slices to several village partner agencies. The cuts total more than $727,000.
Even if Oak Park cuts all $1 million, staff still predicts revenues will be $2 million less than expenses for 2009. After years of deficit spending, Oak Park has no “rainy day” reserves to fall back on in lean economic times, Village Manager Tom Barwin said.
“The future is uncertain, and we have no bank account to live off of,” Barwin said.
Most municipalities strive for a 10-15 percent fund balance, which would be $4 to $8 million for Oak Park, Barwin said. However, the village has no fund balance.
“Since we don’t have that cushion, we have to act like a business,” Barwin said.
Public works plans to keep four positions vacant, while laying off five people in streets and sanitation. That would save Oak Park $250,000 but reduce service, said Public Works Director John Wielebnicki. With deferrals and vacancies, that would cut the streets’ work force in half.
Residents would likely see streets swept every two or three weeks for the rest of the year, instead of the typical once a week. Asphalt patching and litter pickup could also be slower for the rest of the year.
“I’m not sure where else to go,” Wielebnicki said. “To be honest with you … it’s an extremely difficult decision.”
Oak Park is considering privatizing the work previously done by full-time employees for 2009 in order to save more, officials said. Wielebnicki believes the same level of service could be provided in 2009, depending on the prices that come back in bids.
Trustee Greg Marsey opposed the public works cuts, saying they’re visible services, and other areas should have been eyed first.
Fire Chief Bill Bell offered to keep four positions in the fire department vacant through the end of 2008, which would save about $113,000 this year. Bell is proposing to reorganize the fire department in 2008 without reductions to services to save $400,000. The overtime budget would stay the same. Changes would need to be approved by labor unions, he added.
Trustees also approved 10 percent cuts to five different partner agencies for 2008, totaling $77,820. Trustees put off discussion of 15 percent cuts to all five of those agencies for 2009, wanting to be more “strategic.”
“I’m not a fan of across-the-board, meat-axe budget reduction,” Village President David Pope said.
The village board also approved several transfers between funds, totaling $3.26 million in 2008, to repay debts in Oak Park’s general fund.
Marsey called the reductions to public works and the transfers the “low point of my board career.” He argued that similar transfers could be made to fix the revenue shortfall, while other officials said that wouldn’t address the deficit and would be illegal in some instances.
“You are misrepresenting what we’re doing,” Trustee Ray Johnson said. “What you’re saying isn’t true; it just isn’t true. This is my low point, because to have the facts misrepresented like this is worse than the facts themselves.”
Several members of local unions spoke at a board meeting last week, opposing any layoffs. Some urged the village to make cuts to third party services, instead of full-time employees.
“If you go to an outside company, you’re increasing the working poor,” Mary Jo Lopez, a 13-year employee said.
But officials say about 80 percent of the village budget is personnel costs, and some employee cuts are unavoidable without tax increases.
“This is a bridge to get us over this recession,” Barwin said. “All these reductions are being made with reluctance.”