There’s pressure building on Peoria’s city budget. As it stands, elected officials in the central Illinois city will need to contend in the coming months with an estimated $10.5 million deficit.
About $5.6 million of that projected 2016 shortfall can be attributed to state funding cuts Gov. Bruce Rauner has proposed, according to the city. But Peoria also faces a shrinking tax base, mounting pension costs, the prospect of pricey, federally-mandated sewer upgrades, and more routine infrastructure expenses such as street repairs.
Even before the governor proposed chopping the state funds, 2016 budget projections the city made earlier this year looked tight. “We knew that ’16 was going to be tough,” City Manager Patrick Urich said in an interview on Wednesday.
To help citizens better understand the city’s financial circumstances, and to gather feedback about their priorities, Peoria launched an interactive online tool earlier this month. It offers residents a chance to take their own crack at balancing the city’s budget.
The “Peoria Budget Challenge” went live on April 6 and will remain open until May 10. After providing their ZIP code and other optional demographic information if they choose, users are presented with a series of budgeting choices. With street funding, for instance, they can select whether to maintain current budget levels, or increase the amount by either $4 million or $7.1 million. There are buttons users can click on to see the pros and cons of each option.
As users work through the exercise, a thermometer-like red bar on the right side of the screen moves up and down, showing the city’s deficit level based on their choices.
“I’ve been trying to engage the public on budgeting over the years in a number of different ways and it’s never been very easy,” Urich said. “It was an affordable tool for us, to roll this out to the public, to put them in the driver’s seat.”
So far nearly 1,200 people have finished the entire interactive survey, according to Urich.
“We don’t normally get that kind of feedback,” he said.
The city manager also noted that of the people who completed the challenge, only about 40 percent have been able to successfully balance the budget.
Peoria licensed the tool from a California-based nonprofit organization called Next 10, which focuses on civic education and engagement.
The group first began working on the budgeting tool in 2004 and released it the following year. The initial version focused on the California state budget and evolved out of the group’s other outreach efforts. Sarah Henry, Next 10’s program director, said 12 cities and two school districts have licensed the tool since 2007 and that there are currently four live versions.
Asked what advantages the online application provides compared to other approaches to budget outreach and education, Henry pointed to the number of people it had helped Next 10 reach, saying that over the years about 500,000 people had used the tool in California.
But, in her view, there is another benefit as well.
“You’re making these tough choices,” she said. “It really gets to the heart of why we created the tool, which is to show people not just one specific choice, or what they’re familiar with, or what they care about, but the full picture.”
Looking forward, the full picture in Peoria has no shortage of complexity and challenges.
Last year’s city budget calls growth in police officer and firefighter pension contributions over the last decade “staggering.” In 2007, those contributions were $7,623,240. In the 2015 budget, they were pegged at $15,282,446. “That’s an obligation we have,” Urich said.
During the next round of budgeting discussions, he said the city council would likely need to have a conversation about “unshackling” property tax levy rates, which have remained relatively constant over the last two decades.
“I’ve told them that that can’t continue any longer,” Urich said. “Because what we’ve seen over the last several years is more and more of our property tax dollars are shifting into pensions, and there’s less and less in the general fund to cover the cost of salaries and wages.”
There’s also the combined sewer overflow issue. The city is currently working with the U.S. Environmental Protection Agency to develop a plan to meet Clean Water Act requirements.
According to the city, snowmelt or rain overwhelms the city’s sewer system about 28 times each year, resulting in sewage flowing into the Illinois River, which runs along Peoria’s eastern edge.
“We’re negotiating the consent decree right now,” Urich said. “But we know that that fix is going to be costly.”
He estimated that the ultimate price of the required upgrades would amount to hundreds of millions of dollars and require increases in sewer rates.
The budget challenge includes a question about the combined sewer overflow mandate, asking residents whether they’d prefer “green” or “gray” infrastructure improvements.
The green option would employ community gardens, pervious pavement, native landscaping and other measures to help prevent stormwater from entering the city’s sewers, thereby reducing flows into the system. The gray option would involve a large tunnel to convey stormwater to a local wastewater treatment plant.
As of Wednesday afternoon, 69 percent of the people who had completed the survey chose the green option.
Over the last several years, Urich said the city has cut spending on police, slashed the capital budget, which helps pay for road repairs, and offered early retirement incentives to non-public safety employees. “That’s in order to just try to live within our means,” he said.
The revised city budget for 2015 included $181,578,981 of total recommended expenses. The level of general fund expenditures was set at $88,982,621. The $10.5 million estimated deficit is equivalent to about 5.8 percent of the total expenses figure.
The cuts proposed by the governor that Peoria is factoring into next year's estimated deficit are not finalized, and local officials in Illinois are making the case that they would harm services.
For now, Peoria will continue its public outreach efforts around the budget. The budgeting process normally revs up in the fall and is completed by the end of November.
In addition to the online challenge the city is holding a series of five public budget presentations and participating in an International City/County Management Association national citizen survey, which gathers citizen feedback on a range of community issues.
Urich indicated the city would likely weigh more cuts, but even these, he said, would probably not be enough to make a balanced budget.
“Based upon our current spending patterns we’re not going to be able to address issues like public safety, or issues like infrastructure spending, without some revenue increases,” he said.
“This is not an easy time and there’s not an easy fix,” Urich added.