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DeKalb council supports budget cuts in anticipation of coronavirus crisis' $4.5M shortfall

6th Ward Alderman Mike Verbic voiced some concerns about further cutting of services.
6th Ward Alderman Mike Verbic voiced some concerns about further cutting of services.

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DeKALB – The DeKalb City Council is in support of measures recommended by City Manager Bill Nicklas to cut costs in order to account for an estimated $4.5 million revenue loss expected because of economic shortfalls from the coronavirus pandemic.

The city’s general fund receives its revenue from taxes collected by the Home Rule Sales, State Sales, Restaurant & Bar, Local Use and Hotel/Motel taxes, all of which are estimated to have significant effects on revenue streams, documents show. Nicklas, who calculated the estimated loss based on expected dips in revenue, presented the council with his proposed cuts after what he said was weeks of meetings with city department heads, including police, fire and public works.

The council is expected to vote on the measures during its May 26 meeting.

Nicklas said he asked each department to cut at least 5% from its budget, which would make up for about $2.1 million in lost revenue. The rest would come from the city's reserve fund.

"We made the commitment going in that everybody was going to pay into the decision and feel the impact of the solutions," Nicklas said.

On March 15, the city implemented a hiring freeze on police, fire, public works and other city departments including the finance department. So far, three firefighter hires and five police department roles are on hold. A halt to tax-sharing with neighboring taxing bodies is also proposed, which would save the city $315,000, documents show.

Sixth Ward Alderman Mike Verbic voiced some concerns about further cutting of services.

"I'm unwilling to budget our way into an unsafe DeKalb," Verbic said. "I would be more comfortable with supporting these kinds of reductions once I would have those measures in mind. Yes, we know crime is in some ways dropping, yet in some ways we've had more EMS calls for fire. So what are those things we should be concerned about that won't impact essential services?"

Nicklas said monthly data check-ins with first responder departments will help assess needs moving forward, although department heads are in support of his proposed cuts.

"I don't want to cut city services," said 5th Ward Alderman Scott McAdams said. "If we take money out of reserves, how does that impact our bond rating?"

Nicklas said the reserve fund is there to use only as a last resort.

"We want to maintain that for a rainy day, so I would rather not dig into it unless we absolutely have to," Nicklas said. "We have an eye to a marathon here, not a sprint. I hope it's a half-marathon, not a full marathon, but it's probably going to take us all this year and probably next year to get back to the point where we want to be in terms of reserve and general revenues and how they feed our services."

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