Highlights from the new budget

It is my pleasure to offer highlights for the City of Rochelle’s operating and capital improvement budgets the fiscal year (FY) beginning Jan. 1, 2023. The numbers reflected below were part of my PowerPoint presentation at the Nov. 7 budget workshop. The presentation and budget are available for public viewing on the city’s website.

Proposed general fund revenues for FY 2023 are estimated to be $13,405,888. Expenditures for the new fiscal year total approximately $14,702,934 with general fund capital outlays of approximately $1,010,000. The projected deficit, which is actually spending of funds we have on hand, of $1,297,406 includes additional capital, spending ARPA funds (received in 2022 and spent in 2023) and hiring additional police staff to cover further anticipated retirements.  Projects funded by transfers from the landfill, the non-home rule sales tax, utility tax and motor fuel tax are included in the capital improvement fund and not part of the general fund balance.  The utilities (electric, water, water reclamation, advanced communications & technology center, railroad, landfill, golf course and airport) proposed budgeted expenses are $68,816,595 of which $17,143,391 is for capital outlays. All other Funds, including special, capital improvement, downstate police and fire pensions and internal service total $23,081,950. 

The FY 2023 budget represents the City of Rochelle’s ongoing mission to provide a safe, connected and innovative community with professional, personalized and impartial services.  The spending, specifically all capital expenditures, falls in line with the 2022 strategic planning document that has been adopted by the full city council. Our team worked to ensure that all spending can be tied back to the six core areas approved by the city council.

Strategic plan goals: Economic & business development, financial & management stability, quality of life, community inclusiveness & engagement, infrastructure effectiveness & improvement, and core service delivery.

This budget reflects the priorities of our elected officials. The key priorities that have guided efforts in developing the budget include the following:

Revenues have been estimated at realistic and conservative levels based on estimates due to inflationary pressures and other increased costs.

Basic services are financed at appropriate levels, with an emphasis on hiring in the police department.

Numerous staffing positions could become vacant due to retirements (outside of the police department). Due to the uncertain economic climate, these positions will not be filled.

Investment in infrastructure continues to be a priority. This includes projects funded with utility rates, the non-home rule sales tax, utility taxes, motor fuel taxes, rail revenues, transfers from the landfill fund and the general fund cash balance.

Incentives to expand the local tax base to encourage growth include a property tax rebate program for new and redeveloped housing and the waiver of building permits for small businesses. Other incentives include the Lee/Ogle Enterprise Zone, the city’s three TIF districts, the opportunity zone, foreign trade zone #176, the downtown historic district & the façade improvement program. A continuation to improve the city’s overall appearance is being supported through renewed investments in all major corridors of the community.  This includes promotion of the three TIF districts, continued infrastructure improvements including drainage improvements and beautification efforts. The city has a renewed interest in investment on and near Illinois Route 251 south of the overpass. The redevelopment of the Hickory Grove property continues to be a top priority in 2023.

Continued investments in the city’s utility infrastructure including funding for the completion of major electric distribution upgrades, significant upgrades at the diesel generation plant, phase two of upgrades at the waste water treatment plant, a new iron removal plant at Well eight, lining within the sanitary sewer system and other equipment upgrades. These projects are being funded through 2021/2022 alternate revenue bonds (electric), utility rates and several grants, including Economic Development Administration and Community Development Block Grant.    

The budget includes funding for phase two renovations for new Rochelle Municipal Utilities location on South 7th Street and building improvements at city hall, the police department, fire station and utility billing office. The key priority for 2022 was to consolidate most utility operations. This was completed, including moving engineering to the RMU location.  Administrative services moved to the utility billing office and community development moved to city hall. 

The city continues to address fiscal pressures presented by the following issues:

Initiatives by the legislature to prematurely close the Prairie State generating plant. This could have long-term negative impacts on utility rates.

Increasing inflationary pressures and borrowing costs and the possibility of economic recession.

Continued regulations forcing further upgrades to water and water reclamation treatment facilities.

Airport revenues continue to lag operational and capital expenses.

State of Illinois business climate and budget deficits.

Possible funding cuts in the Local Government Distributive Fund (LGDF).

Potential for significant revenue increase through a new rail transload center. 

Jeffrey A. Fiegenschuh, ICMA-CM, MPA, is the city manager of the City of Rochelle.


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