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Pension fund hike leads to budget cuts

 
BY JOHN HOMAN
Managing Editor jhoman@localsouthernnews.com
updated: 9/12/2018 12:29 PM

DU QUOIN -- Department heads within the city of Du Quoin have some tough financial decisions ahead as they must come up with a way to pay an 11.22 percent increase to the Fire and Police Pension Funds as set by the Illinois Department of Insurance. That percentage increase translates to a $62,811 hike over last year's combined payment of $559,000 to the two funds that is paid for annually through a citywide property tax levy.

Addressing Du Quoin Fire Pension Board President James R. DeMent at Monday night's regular meeting of the city council, Mayor Guy Alongi said he is not about to go back to the taxpayers and levy an additional $62,000 from city residents.

"We will meet our financial obligations, but we will have to find another way to pay for this (increase)," the mayor said. "We are not going to raise property taxes by 11 percent to pay for this."

Alongi said each commissioner and department head will need to assess each of his or her departments (Police, Fire, Sewer, Water, Streets and Alleys) and see where cuts could possibly be made. Overtime cuts through the rearranging of employee schedules might be the most prudent form of cost reduction, the mayor said.

"This is not going to be a tax-and-spend administration. Surely, our department heads can come up with $62,000 in cuts out of a multimillion-dollar budget. I think there is enough fat in overtime hours alone."

Alongi said he doesn't expect any budget cuts to affect services to residents in any way.

"We're going to have to go after some low-hanging fruit," said Commissioner Chuck Genesio. "Overtime pay might be one possibility. We already have over $100,000 spent in overtime hours. We're going to have to find a way to get a little more efficient. As much as 83 percent of our total budget comes from labor and benefits, so that doesn't give us a lot of flexibility."

City Clerk Andrew Croessman said department heads would have until December to make the necessary budget cuts as the city will not have to pay the additional $62,000 it owes the Fire and Police Pension Funds until the early part of 2019.

"Every penny that we collect from our tax levy in property tax goes directly to the two pension funds," Alongi said. "And that's the way it's been for years. This increase was something that none of the municipalities in Southern Illinois were prepared for."

The mayor added that the city is not anticipating much of a bump in sales tax revenue from the recently completed Du Quoin State Fair to help offset this added cost.

"Attendance was clearly down this year," he said. "Maybe as much as 25 to 30 percent."

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