City of Champaign Prepares for Budget Gap

City Departments Develop Budget Savings Ideas for City Council Review

City of Champaign departments have spent the past three months participating in a “Budget Contingency Planning” process to identify ways that the City can reduce its budget in anticipation of potentially significant financial challenges. Based upon the most recent information available, the City expects to face a current year budget gap of up to $2 million. Continuing increases in service costs, the uncertainty of the State of Illinois budget, and slow economic growth all have had impacts on the City’s budget. The “Budget Contingency Planning Process” is the organization’s response to the City Council’s desire to anticipate further budget balancing measures. “Contingency planning is similar to emergency preparedness — it is a proactive way to prepare for the future, even if we cannot fully anticipate what the future might bring”, said Champaign City Manager Steve Carter.

At this point, the urgent issue is finding budget adjustments to close the current year budget gap. For this reason, the City Administration has asked departments to focus their efforts on analyzing savings alternatives at the $2 million level and submit their suggested lists of savings proposals by October 1. These ideas have been distributed to the City Council for their review. The City Council is expected to discuss the possible savings alternatives at a Study Session in November. They will also review the City’s

Five-Year Financial Forecast and will be in a better position to determine what level of additional cuts may be needed to cover future budget gaps.

Although it is too soon to know the depth of the actual budget shortfall, as part of the “Contingency Planning” process, departments were also asked to explore additional savings ideas of up to $6 million in the Five Year Financial Forecast shows a larger gap due to economic trends or actions taken by the State. Based on Council direction in November, City departments may be asked to study these additional savings ideas. Over the past few years, the City has already implemented budget-balancing measures of close to $9 million including cuts to operations and capital projects.

While the City Council has worked diligently to minimize the effect of cuts on the public, continued budget reductions are likely to have real, visible impacts on the community. “This next round of cuts could mean serious changes in the way the City does business and the services we provide. It could also have significant personal implications for our employees and their families,” said Carter. “We are committed to providing the City Council with the best information possible to make these important and challenging decisions.”

More information about the specific savings proposals under consideration can be found at http://ci.champaign.il.us/departments/finance/budget-division/. As always, Council discussions about budget and service changes will be held during public meetings. Citizens will be encouraged to provide public input throughout the process.