Prekwinkle delivers good budget news ahead of primary

Cook County Board Chairman Tony Prekwinkle delivered a piece of good news ahead of Tuesday’s primary election: His administration’s budget gap forecast is the lowest since he took office.

As a result, Prekwinkle said Wednesday that it does not plan any new taxes, fines, fees or layoffs in its 2023 budget proposal. “We’re just going to figure out how we can be more effective with the resources we have,” she said.

Prekwinkle is running for re-election and is facing former Cook County Commissioner Richard Boykin in Tuesday’s Democratic primary.

County finance officials said the projected budget gap in the 2023 fiscal year would be only $18.2 million. , Thanks to better-than-expected revenue from sales taxes, some corporate income taxes and fees to county clerks — compared to a total 2023 budget of $8.1 billion — fueled by the recent construction boom.

In addition, the tight labor market is leading to longer hiring hours, keeping payroll costs low, county officials said. Higher revenues and lower expenses are expected to create a $233 million surplus in the county’s general fund.

The forecast gap for next year is a dramatic drop from the height of the pandemic. Prekwinkle’s 2021 budget was short of about $410 million, forcing her to tap into the county’s Rainy Day Fund and lay off workers to balance the budget. The following year, revenues soared and federal aid helped reduce the deficit to $121 million.

“We entered this very difficult pandemic period on a really strong financial footing, and as a result we have been able to make it through this much better than other local governments. And we find ourselves in a position now where the economy is emerging from some of the pandemic challenges in a really good place,” Prekwinkel told reporters at Wednesday’s briefing.

In total, the county received $1 billion from the federal American Rescue Planning Act (ARPA). Commissioners have already authorized nearly $300 million in ARPA spending on programs such as the county’s $42 million Guaranteed Income Pilot Initiative and a $65 million grant to violence prevention groups.

But it is likely to be cloudy. “There are signs of a recession on the horizon, which could lead to a significant drop in county sales tax and other financially sensitive revenues,” County Budget Director Annette Guzman said.

Sign up for a spin to have the top stories in politics delivered to your inbox weekday afternoon.

The county’s health fund could take two other hits in the coming year. The state is expected to resume the annual eligibility review for Medicaid — known as rescheduling — in the coming months. This could result in thousands of existing patients with Cook County Health’s Medicaid-supported insurance plan, CountyCare, losing their coverage, and the county being denied reimbursement. This rescheduling process could send more uninsured patients to Cook County hospitals and clinics, increasing charity care costs.

The county can also lose out on new enrollments and the revenue that comes with them. Half of Medicaid managed care patients who do not choose a provider are automatically enrolled in CountyCare by state. Officials are planning, conservatively, to drop that number to 35% – its pre-pandemic level – by the end of this year.

There are other long-term costs. After several years of effort to reduce the workforce, the county workforce is up 7% from the previous year. However over time, the workforce has dwindled slightly – there are 23,467 budget full-time workers in the county, compared to 23,801 in 2011. And ARPA-funded programs such as the Guaranteed Income Pilot, anti-violence funding, a new behavioral health department and a plan to eliminate medical debt are also costly in the long term.

“The ones that are more transformative are probably going to have the highest price tag,” Guzman said.

The county has fallback cash: reserves are expected to be up to $900 million by the end of the year. This is enough to fund county operations for about six months.

Prekwinkle will not formally present her budget until October.

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: