2009 Annual Operating and Capital Budget - Village of Huntley
2009 Annual Operating and Capital Budget - Village of Huntley
2009 Annual Operating and Capital Budget - Village of Huntley
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Economic Outlook for FY<strong>2009</strong> <strong>Budget</strong><br />
The <strong>Village</strong>’s mission statement for <strong>2009</strong> is to “Do More with Less”. <strong>Huntley</strong>, not unlike all<br />
municipalities across the Country, is impacted by the on-going global economic crisis, <strong>and</strong> this<br />
budget is presented under the most difficult economic times in recent history. The <strong>Village</strong>’s<br />
financial solvency <strong>and</strong> ability to complete capital projects is directly linked to external<br />
economic factors such as unemployment, which impacts <strong>Village</strong> revenue sources such as sales<br />
tax <strong>and</strong> income tax received from the State. The State unemployment rate increased for the<br />
fifth consecutive month in October <strong>and</strong> now st<strong>and</strong>s at 7.3%. The rate was 5.3% one year ago.<br />
Locally, over the last year, unemployment rates increased from 4.2% to 6.0% in Kane County<br />
<strong>and</strong> from 4.0% to 5.6% in McHenry County.<br />
Building permit revenue is another area where the <strong>Village</strong> has been impacted by external<br />
economic factors. Though <strong>Huntley</strong> continues to be one <strong>of</strong> the leaders in new residential<br />
home permits issued in the Chicago metropolitan area, the decrease in dem<strong>and</strong> for new<br />
homes has a significant impact on <strong>Village</strong> finances. Building permit revenue accounted for<br />
27% <strong>of</strong> the <strong>Village</strong>’s General <strong>Operating</strong> Fund revenue in 2006 <strong>and</strong> 18% in 2007. It is estimated<br />
that this percentage will drop another 8% in 2008 to 10%. The <strong>Village</strong> has been fiscally<br />
conservative regarding the use <strong>of</strong> building permit revenues over the years <strong>and</strong> has attempted<br />
to use this one-time revenue source for capital projects <strong>and</strong> purchases <strong>and</strong> not to fund<br />
operational costs to the extent possible.<br />
Perhaps the most alarming aspect <strong>of</strong> the economic crisis most recently is the “spin-<strong>of</strong>f” or<br />
unforeseen consequences that could have significant impacts on the <strong>Village</strong>. Specifically, other<br />
entities such as the State <strong>of</strong> Illinois <strong>and</strong> the Illinois Municipal Retirement Fund (IMRF) have put<br />
the <strong>Village</strong> on-notice that some <strong>of</strong> their financial difficulties may now impact the <strong>Village</strong>.<br />
The Governor’s proposed “Emergency <strong>Budget</strong> Act <strong>of</strong> Fiscal Year <strong>2009</strong>” is to withhold 8%<br />
from the Local Government Distributive Fund (LGDF). The revenues received from this fund<br />
<strong>Village</strong> <strong>of</strong> <strong>Huntley</strong> FY<strong>2009</strong> <strong>Budget</strong> Transmittal Letter 10
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