Mokena feeling effects of economic downturn

I am sure it is no surprise to anyone reading this article that the national recession has resulted in significantly decreased revenue for all levels of government.

Whether it is the federal deficit, the declining condition of our state's budgetary affairs or your local government here in Mokena, revenues have been deteriorating significantly over the past 18-24 months.

In most cases, the decline in revenue is due to economic factors beyond the control of local/municipal government such as unemployment rates and slowing retail sales.

Recently released figures confirm that income and sales tax revenues are well below anticipated projections utilized by the Illinois General Assembly when they adopted their budget beginning July 1. Not only are statewide revenues down, but the distribution of funds to cities and villages has slowed due to the state's unprecedented cash flow problems.

To deal with these problems, local governments are attempting to reduce overall costs to accommodate declining revenue sources.

Although we have endured recessions in the past, after two decades of fairly consistent economic growth, the current economic downturn is much more severe than anything experienced in recent memory.

Most municipal governments throughout Illinois are facing similar problems. Statewide financial forecasts are being revised regularly and mostly in a downward fashion.

The approach we have taken here in Mokena regarding this issue has been consistent, incremental and pro-active. We are trying to make careful decisions that are logical, practical and have the least negative impact on Mokena residents.

At the same time, we are trying to openly and regularly communicate the status of this situation to Mokena Residents, businesses and our employees whom we believe are all stakeholders. To that end, the bullet points below reflect our efforts to date.

• Recently revised statewide revenue projections have indicated a significant drop in revenues creating a $550,000 "gap" in the village's current year budget.

• The combined impacts of current year budget reductions, cost-cutting, and the use of both contingency and fund balances have now reduced this "gap" to approximately $200,000.

• This brings total General Fund spending reductions to $1.75 million over the village's past two budget cycles.

• The village previously reduced its workforce by four full-time employees (when the Village's current fiscal year budget was adopted).

• Although village staff members continue to work on additional budget cuts, a further reduction in personnel costs is required.

• The village's workforce has recently been engaged to discuss employee contributions as a partial solution to this dilemma.

• These discussions are premised upon Mokena's 82 full-time employees mutually contributing to reduce personnel costs further without impacting services to residents and customers.

Based on the foregoing, we are continuing to evaluate ways to deal with this unforeseen statewide revenue loss. Although we have accomplished much in a short period of time, we have more work to do moving forward. We have been able to take incremental and logical steps to approach this problem because we have maintained adequate fund balance levels (cash reserves) over the years. A short-term component of our problem solving includes utilizing a portion of the general fund cash reserves to offset the imminent revenue loss.

Although it is a good situation to possess these reserves, they will not last forever if we do not structurally balance our revenues and expenditures moving forward. We must keep your village financially stable for the future welfare of all Mokena residents.

Rest assured, we will continue to work on your behalf to make sound decisions. As always, we welcome any thoughts or comments you have on the matter. Please stay in touch with our local board meeting broadcasts (both channel 6 and webcasts) along with our E-news letter. You can observe any of our recent board meetings online by going to our Web site at www.mokena.org as well as sign up for our E-news letter.

If you visit our Web site's homepage, click the online video icon and go to the Sept. 28 board agenda, click "budget briefing" under the Village Administrator's Comments to get a good summary of this situation.

We will continue to work diligently on everyone's behalf to get through this difficult time.

Joe Werner is the mayor of Mokena.