City Manager Todd Thompson says the City of Galesburg is relatively prepared to face an economic downturn compared to some municipalities.
Still, Thompson says the economic impact of COVID-19 and related shutdowns will take a toll on the city budget.
City administration put together a model for three scenarios, including a moderate impact scenario, which assumes no large second wave of COVID or some drastic change in state rules for local funding.
Under this scenario, the city foresees a $3.4 million revenue shortfall this fiscal year which is about 13 percent of tax revenue.
Thompson told Galesburg Aldermen Monday night that a diversified tax base, strong reserves, and low debt make it less likely the city will have to enact layoffs.
All sources of payments to the debt aren’t related to the general fund, which is the fund that can be expected to be most directly impacted by a downturn.
One area where Thompson does have concern is the city’s pensions.
Thompson says all projections are based on many unknowns since there isn’t a recent precedent of the impact of a pandemic on government budgets.
Parks and Rec Director Tony Oligney-Estill gave Thompson a worst-case scenario estimate if all parks and recreation programs and facilities were closed for the rest of the year, separate from the model that shows a $3.4 million shortfall.
Thompson says the city would actually save money, up to $304,000 for the year, if there were no parks and rec programs.
Parks and rec is subsidized for the community benefit and is staffed largely by part-time workers.
Still, Thompson says it’s the city’s intention to open up recreation facilities as soon it’s possible and safe.
Bunker Links Golf Course did open to business with restrictions on Friday.
The City Manager says the council has been putting a fair amount of money aside for programs to replace things like vehicles and computers.
He would suggest deferring some of those payments and delaying some equipment replacement, to balance the budget in the event of a shortfall.
Another suggestion he would put forth is to transfer some sales tax dollars to replace lost hotel/motel taxes, which are what funds the Galesburg Promise program, that helps GHS students attend Carl Sandburg College.
