The City of DeKalb FY11 budget was passed at the June 28 meeting of the city council. On paper, after all the amendment dust settles, the City hopes to have a few hundred thousand dollars in surplus in its operating budget at the end of the fiscal year.
Second ward alderman Tom Teresinski acknowledged the efforts put into balancing the operating budget. He then stated that the City has a structural deficit that was once again not addressed. Fifth ward alderman Ron Naylor acknowledged the former employees that were laid off and said he wouldn’t be surprised if the council wouldn’t be facing the same tough decisions next year. Fourth ward alderman Brendon Gallagher read an article that explained that Illinois posed the greatest risk to GO bond buyers in the nation. The article said Illinois was ranked only a slightly lower financial risk than Iraq. But DeKalb taxpayers need not worry about the $1.5 million dollar in bonds the City will be issuing until 2030 to pay for the early retirement buy-outs and severance packages it took to balance the FY11 operating budget.
Structural deficit, indeed.
Rather than quit spending operating funds that the City does not have they borrow it. One year it might be from the water fund. Another year maybe its borrowed through Bond Anticipation Notes. Then from debt rollover. It was once considered bad practice to use long term debt to pay for annual operating expenses.
DeKalb entered new territory. It created long term debt for severance pay.
But, as long as revenue projections hold true, DeKalb will have a balanced FY11 operating budget. On paper.
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