‘Optimistic’ Mayor Ali believes the Peoria City Council will resolve the budget impasse and close pension gap
As the Peoria City Council prepares for another attempt to approve the 2022-23 biennial budget Tuesday night, Mayor Rita Ali says she is optimistic a deal is within reach.
The main roadblock has been finding a solution to filling a $4 million gap – $2 million each year – in funding pension payments after the council voted earlier this month to end the public service pension fee.
“We have to approve a budget before the end of the year, whether that's cutting expenses – which I hope that we don't go that route – or coming to some compromise,” Ali said in an interview with WCBU. “I'm just really confident that our budget will be approved before Thanksgiving; I hope that's the case, and I'm just optimistic that we can come together as a council and work that out for the people of Peoria.”
Among the possible solutions presented by City Manager Patrick Urich is using sales tax revenue from this year to cover the pension hole over the next two years.
“He (Urich) was pretty conservative in terms of projecting sales tax revenue; it was much higher than anticipated, both local sales tax revenue as well as what we've received from the state,” said Ali. “So that's a very good sign, I would say, of what's to come. It gives us an option I hope that we will consider.”
Ali said another option, reducing expenses more, is not an ideal solution.
“We know that cutting expenses means cutting staff; that's not one of my preferred options,” she said. “We've had staff that have worked really hard throughout a very difficult time in our lifetimes, and that's the pandemic.
“I anticipate with the new infrastructure bill that we're going to be hiring many, many new employees, because we're going to be short staffed. Some of those employees may be temporary over a 4-5 year period, because that's what the grants will be funded for. But with our new capital investments that we're going to have over the next two years, we're going to need employees.”
Ali said the city remains committed to providing necessary services. Earlier this month, the City Council voted to restore a fire engine company that had been decommissioned last year in a wave of cuts necessitated by revenue losses from the COVID-19 pandemic. Additionally, plans to hire 30 new police officers remain on track, for now.
“I think that there's a unanimous consensus, that we don't want to cut any police during this time of record homicides and increases in violence,” said Ali. “I think that it's also important that we maintain our core services, and that includes code enforcement as well as firefighting personnel.
“So it presents a challenge, again, that we have this pension liability. But we're not going to stop paying our bills. We will continue to pay at least, you know, even more than the minimum that's required by statute; we are committed to doing that. But without the public pension safety fee, we're not able to pay as much as we have over the last few years.”
Beyond covering the pension obligations through 2023, the city’s ongoing problem is the state’s requirement that public safety pensions are 90% funded by 2040. For Peoria, that amounts to around $360 million.
“We really have to work with our state General Assembly, our state elected officials in trying to find a long-term solution for this situation that has us fiscally strapped, quite frankly,” Ali said. “One solution that many are looking at across the state (is) moving forward for an additional 20 years, the amortization of the pension.
“That would actually give us some relief, if we push that out for another 20 years. And I know that people say that's kicking the can down the road. However, we are strapped and if we don't make some additional provisions, we won't have resources. It's not just Peoria's problem. It's a problem across the state.”
Ali acknowledged that more is needed beyond hiring additional officers to address Peoria’s spike in gun violence that has contributed to 31 homicides so far in 2021. She said encouraging more volunteerism and mentoring, as suggested by several speakers at last week’s Peoria Area Chamber of Commerce Thanksgiving Luncheon, is a step in the right direction.
“I think that that's one of the community-based solutions, that we should definitely increase the volunteerism,” said Ali. “There was a group, I think it was out of Pennsylvania, a fathers group that got together and they went into the schools as role models and mentors for these young people. And they're really seeing a difference, a change and they're beginning to provide direct mentoring. We need that; that's one of the gaps that we've identified.
“We've actually identified all the mentoring groups in Peoria that can assist with gun violence prevention and gun violence reduction. So I think it's a matter of identifying all of our resources that can contribute to gun violence reduction and connecting them. That's what we're doing with the Safety Network, or S-NET, is bringing together all those resources, whether it's mentoring or after school tutoring, whether it's programs that wrap support around social/emotional needs of young people, because we're seeing a lot of younger people getting a hold of guns and being involved in the violence.”