At the Vermilion City Council Meeting on Monday, November 4, 2019 Amy Hendricks, Finance Director, reported that as they approach the end of the year she continues to work on revising the projections for 2020. It appears the city is going to have just under $6,000,000 in revenue for the general fund without any additional sources of revenue.
“The difference between this estimate and the 2019 actuals is that the city has received $190,000 in one-time revenue from repayments to the General Fund from monies that had been advanced or loaned to other funds in prior years, for example the sewer fund,” stated Hendricks. “In this case, the $35,000 in pool donations that were carried over from 2018 fundraising has been exhausted. Additionally, based on Meeder’s estimates, $50,000 less in investment income was due to declining rates.”
Expenses are projected to be $6,250,000 for the General Fund for 2020, according to the Fiance Director. If everything remains status quo, the City will be deficit spending by the end of 2020 based on these early estimates. She added 3% inflationary increases on all nonpayroll related expenses, as well as a 12% increase in health care costs.
The 12% comes from NFP, the city’s insurance advisors. They did have a scare last week when the estimate came back with an initial quote from United Health as a 17% increase. They have already started working on negotiations with other carriers and United Health, and they feel the 12% is probably more reflective of where the city would be based on the current plan design. She said salary increases will be determined at the conclusion of negotiations with both unions.
Hendricks said this information is not shared to cause panic – it’s shared so they have time to consider as they approach things for next year and throughout 2020 and going to 2021 when they look at revenue and expenditure decisions as the city moves forward to minimize any shortfall.
“One thing Moody’s mentioned in the city’s last rating review was that the city is showing progress, but they want to see the city sustain it for the overall health for the city,” stated the Fiance Director.
Council Member Brian Holmes said he wants to make sure the city is looking at their options for the pool and asked if this conversation would be ready to discuss at the November Finance meeting. Mayor Forthofer said there is a young man that worked at the pool during the summer who will be doing the sheet tabulations, and Tony Valerius is looking into three capital improvements for the pool.