Funding Police Pension Just One of the Challenges to City’s Finances

Last year, the amount required to fund the City of Northlake Police pension Fund was $889,921. The funding forecast provided by the actuary sets this figure at $1,005,094 for 2014; an increase of $115,173.00.

We cannot keep adding these amounts to the City’s real estate tax levy. Although the City’s portion of your tax bill is only 12% of the total, any increase still contributes to the total paid by property owners.

The City cannot reduce pension benefits as an alternative, as these have been set by the State Legislature over the years, and local municipalities have no control over the terms of the pension. The Legislature sets the pension benefits, leaving the issue of funding to local governments.

In addition to increased pension costs, the City is also facing increases for insurance coverage, partly due to the “Affordable Health Care Act,” utility bills, fuel cost, as well as trying to maintain and improve our infrastructure and facilities.

New revenue sources are few and far between. In October, the City Council took up the matter of video gaming, as the City would receive 5% of the revenue from this activity. It appears likely that video gaming will be approved by the City Council before the end of the year, with the provision that all proceeds be paid to the police pension fund. Hopefully this will keep future increases in the City’s contribution to the fund from appearing on your tax bill.

Overall, the City’s financial picture is relatively solid. However, we must take steps to make sure that going into the future, we maintain fiscal stability, and meet our obligations without placing an undue burden on City taxpayers. We will continue to find ways to streamline procedures and practices while maintaining City services as well as providing a solid base for the future.

I would like to wish you all a happy and healthy Thanksgiving holiday.