November 07, 2024
Click here to read the full report.
Click here to read the press release.
EXECUTIVE SUMMARY
This analysis of Cook County’s proposed FY2025 budget finds the Preckwinkle Administration has produced a responsible budget with no tax or fee increases, and that the County remains in a strong position to navigate future projected shortfalls.
The County is proposing a FY2025 budget for all funds of $9.89 billion, an 8.3% increase from the $9.14 billion budget adopted the prior year. The budget also closes a General Fund gap that was forecast at $218.2 million.1 The General Fund includes the Corporate Fund and the Public Safety Fund, but not the Health Fund or Special Purpose Funds. The deficit was closed with higher than anticipated natural revenue growth, the use of General Fund balance and net expenditure reductions including lower-than-expected healthcare and payroll costs.2
The projected growth in total expenditures across all funds is attributed primarily to scheduled employee cost of living wage increases, higher managed care claims expenses due to higher-than-expected CountyCare membership enrollment in the health systems and increased pension contributions due to an increase in liabilities associated with higher than anticipated current employee salaries.
The Cook County FY2025 proposed budget continues the Preckwinkle administration’s focus on utilizing best practice financial and management policies. These include:
- Using long-term financial planning and forecasting techniques and strategies that have helped anticipate and develop plans to mitigate budget shortfalls;
- Developing a plan for the use of excess revenues, including creation of an American Rescue Plan Act (ARPA) sustainability reserve fund to provide ongoing support for programs created using those funds; and
- Implementing a pension funding system based on actual requirements and a 100% funding schedule that will also resolve in a fiscally responsible manner an issue with pensions for Tier 2 employees potentially falling out of compliance with federal Safe Harbor rules.
These efforts have put the County in a stronger financial position than many of its peers in the region and enabled it to build up healthy general operating reserves. Budget projections for the next four years show manageable projected shortfalls in the General Fund and Health Fund due to expenditure projections somewhat higher than revenue growth.
The Civic Federation presents the following key findings from the Cook County FY2025 proposed budget:
- Appropriations: The County’s Executive Budget Recommendation proposes total spending of $9.9 billion in FY2025, which represents an increase of $628.5 million, or 6.8%, from the FY2024 adopted budget of $9.3 billion.
- General Fund appropriations, which account for public safety and administrative County functions, are proposed to be nearly $2.2 billion, a decrease of 0.1% from the prior year budget. The slight decrease is primarily due to the elimination of a one-time transfer from the General Fund to the Annuity and Benefit Fund.
- Cook County Health appropriations of $5.1 billion represent an increase of $889.3 million, or 20.9%, from the FY2024 adopted budget. The increase reflects an anticipated increase in Managed Care claim expenses.
- ARPA Funding: The FY2025 budget includes $9.9 million for short-term and one-time expenses as well as $165.4 million for a fourth-year allocation to the County’s community-based programs. An ARPA sustainability reserve of $158.8 million has been created to maintain the various programs after current funds run out. This reserve will be phased out by FY2031. The County is seeking funds to maintain those programs on a recurring basis.
- Property Tax Revenue: FY2025 total property tax revenue will be $824.7 million, an increase of $7.4 million, or 0.9%, from revenues of $817.3 million in FY2024. The County will continue to hold its base property tax level flat at $720.5 million as it has done since 2001 but will generate an additional $95.1 million from expiring TIF districts, new property and expiring incentives.
- Personnel: The County proposes a total of 22,830.2 full-time equivalent (FTE) positions in the Operating Funds, which is a net decrease of 44.9 positions, or 0.2%, from the adopted FY2024 budget. All positions eliminated in FY2025 are vacant positions.
- Pension Fund: The proposed budget includes a total pension fund contribution of $568.3 million in FY2025. This includes a property tax and PPRT contribution of $223.3 million and a general fund contribution of $345.0 million.
- Fund Balance: The County had $1.4 billion in unrestricted general operating reserves at the end of fiscal year 2023. This is well above the target set through the County’s fund balance policy. Therefore, the FY2025 budget will allocate $210.3 million in excess unassigned fund balance toward one-time uses.
- Debt: Cook County’s debt service appropriations of approximately $260 million make up approximately 2.6% of total expenditures, which signifies a low bonded debt burden.
Click here to read the full report.
Click here to read the press release.
____________________________________________________________________________________
(1) Cook County, Fiscal 2025 Cook County Preliminary Forecast, p. 4.
(2) Cook County, Executive Budget Recommendation Presentation Fiscal Year 2025, October 10, 2025.
(3) Cook County FY2025 Executive Budget Recommendation, Volume 1, p. 3.