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‘Everything On The Table’ To Close Cook County’s $220 Million Budget Gap
Huge drops in sales and other taxes because of COVID-19 and increases in some costs have led to deep deficit. Officials say 2021 will be just as bleak.

Friday, June 26, 2020
WBEZ News
by Claudia Morell

Cook County anticipates a $219.7 million revenue shortfall for the end of the 2020 fiscal year, according to preliminary budget estimates released by county budget officials Thursday.

Officials say they plan to close that gap in part with an expected $102 million from the federal government, some furloughs of county non-union workers, reductions in hiring and delays of contracts for planned work.

Illinois’ largest county has dealt with projected budget deficits in the past — most notably during the soda tax debacle in 2017. But this time is different.

“One of the unique things for this year and next year, is that we just don’t know how the pandemic is going to play out,” explained Ammar Rizki, the county’s Chief Financial Officer. He says one of the biggest unknowns: whether there could be a second wave in the fall that continues into early 2021.

Second wave or not, next year’s fiscal forecast is even bleaker with an anticipated general fund deficit of about $222 million and a health fund deficit of $187 million, for a combined $410 million gap. That number assumes no additional federal stimulus. Since Cook County President Toni Preckwinkle is required to present a balanced budget this fall, she says “everything is on the table” when it comes to closing that gap.

“This is the largest budget gap we’ve seen in almost a decade. So we are going to be looking at holdbacks [layoffs], delaying purchases, renegotiating contracts with our vendors, a variety of strategies to meet the challenge that we face,” Preckwinkle told reporters when asked if a tax increase is being considered.

Preckwinkle and her budget team told reporters they oppose dipping into the county’s budget reserves or delaying next year’s pension payment.

Overall revenues for 2020 are down $297 million. The biggest losses are in the sales and use taxes due to the economic shutdown caused by the coronavirus pandemic. The sales tax is down 13%, the use tax 27% for a total shortfall of $132.3 million.

Officials peg amusement tax loss at 84% or $33.5 million under budget due to a loss of ticket sales at theaters, concerts and other venues. Court fees and general business licensing fees are also significantly under budget after months of being closed to the public.

Overtime spending this year, mainly in the public safety departments, is $43.5 million over budget. And original estimates for materials and supplies are more than $1 million over budget due to additional COVID-19 related expenses.

The deficit is slightly lower than was originally projected in April, however, due to furloughs and a hiring and spending freeze on nonessential contracts.

This week, the county health and hospital system eliminated 70 of its nonunion positions, more than half of which were filled.

County budget officials warn that more layoffs are likely if expenditures continue to outpace revenues. Many of those furloughs will be at the discretion of department heads as they prepare next year’s budget.

Preckwinkle and budget officials stressed an urgency for additional federal aid in order to prevent any drastic measures to close the gap.

Claudia Morell covers politics for WBEZ. Follow her @claudiamorell.

This story has been updated to include additional information about the funding gap for 2021.



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