Wednesday, March 18, 2009

The Template for forging the Revised FY 2009 County BUDGET

I have received the various handouts from the Finance Committee meeting of March 10, 2009.  I did not attend the meeting but from the worksheets and information that I gather, it appears that a revised budget is beginning to be constructed based upon the current recession conditions.

Below is the summary sheet of of the current monetary objectives which the Finance Committee and various departments will apparently use to arrive at a revised budget.  I would assume that once their details are worked out,  the entire revised budget will be approved (amended) by the entire board.  Inasmuch as the process will really begin after May 1, I do not foresee the revision being approved until late June or July by the county board.  Hopefully some of the changes will actually be implement before then.  For the most part my discussion will center on the first handout.  If you desire you may click any of  photocopies to enlarge them:

Mar 11 Revision #1a

I believe it is always best to begin an explanation with where are we going?  Well at the very bottom there is number which I have put a square around.  This number is the amount of additional FY 2009 Expenditures to avoid or cut;  the number is $197,348. Based upon projected increases and decreases in projected income (Top part of sheet) and $248,128 expenses already cut or held back, the budget should be balanced if $197,348 of additional savings or cuts can be found.  Possibly a relatively easy process since that represents only 1.5% ($197348/$13,762706) of General Fund Expenditures as currently revised. 

There have been some major changes in revenue assumptions and additions to the revenue side to obtain such a modest number.  The items which I have “checked”at the top represent 4 of the 5 revenue sources which we have been reviewing monthly.  For convenience I will add  the new projection to our chart from March 17 and compared the first three months of actual revenue with the new projected revenue from these sources.  As shown by the chart the new assumptions for sales type taxes, replacement tax and state income tax are very close to the revenue loss we have experience the last three months.  We do not have the new projections for CTSB (Public Safety Tax). It  is not directly accounted for by any of the worksheets, other than no transfer to the General Fund is anticipated now.  I believe  previously this non-general fund item(CTSB) was providing a sizeable transfer in;  under the revised budget no transfer is anticipated.

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The county is being saved from large cuts because of additional Prisoners from DeKalb, $153,300, and a one time reimbursement from the HAVA Act, $99,943.  Prisoner reimbursements in the past have at times been a problem because of unanticipated costs, hopefully this will not be true this time.

There are a number of facts which I do not understand.  County Clerk Recorder & Rev Stamps represents both a loss of revenue of $151,333 and an effective gain of $80,000 for a curtailment of expenses.  There also is the one time transfer out of Health Insurance of $50,000.  I am sure some  friends may help me on these small items.

The following are the other worksheets.  All of the sheets are the income items.  The major changes in income have for the most part been covered by the above analysis.

mar 11 revision #2 Mar 11 REVISION#3

mar revision #4 mar 11 revision#5

Mar revision #6 Mar revision 7

mar revision #8 Mar revision 9

The Belvidere Daily Republican. - Local food supply for hungry families dwindles, reports Salvation Army

 

The Belvidere Daily Republican. - Local food supply for hungry families dwindles, reports Salvation Army

Fed to Buy $1 Trillion in Securities to Aid Economy - NYTimes.com

The is another first, but not as revolutionary as many actions this year.  The FED tries to lower long term rates by buying bonds(usually the Fed only buys the short term Treasuries Bills).  Short term interest rates can’t go much lower, they are nearly zero. So the Fed is attempted to affect the financial market at longer maturities.  Click of the following to read the story:

Fed to Buy $1 Trillion in Securities to Aid Economy - NYTimes.com

Manzullo: Taxpayers Need Answers on AIG Bonuses

- Manzullo picture

March 18, 2009

FOR IMMEDIATE RELEASE

Contact: Rich Carter
(815)356-9800

Manzullo: Taxpayers Need Answers on AIG Bonuses

[WASHINGTON]  Congressman Don Manzullo (R-IL) is participating today in a major Congressional hearing investigating why AIG, a recipient of billions of dollars of taxpayer bailout funds, awarded its executives with $165 million in bonuses last week.

Manzullo delivered the attached statement this morning during a hearing of the House Financial Services Subcommittee on Capital Markets, Insurance and Government-Sponsored Enterprises, of which Manzullo is a member. Manzullo is planning to question AIG CEO Edward Liddy when he testifies later today, which will be carried live on most of the cable news networks and will be streamed live on the committee's website. Manzullo’s opening statement can also be seen on his YouTube channel.

OPENING STATEMENT OF CONGRESSMAN DON MANZULLO (R-IL)

“I questioned Neel Kashkari about TARP on December 10th and asked him if he was going to ask for a $3 million dollar bonus back from one individual. He said, it could be deferred compensation and ostensibly not returnable.  Deferred compensation for what?

I represent Rockford, Illinois, the largest city with 14% unemployment. People are losing their jobs, factories are closing. They’re taking cutbacks, working odd shifts, and taking late night shifts. They aren’t being paid to destroy the economy—they’re being paid to invigorate it.

They’re sitting in this seat today, all 740,000 of them, wondering, how could government do something so stupid as to allow these people to make that kind of money and then sit back and everybody point fingers at each other?

We want some answers today.”