Mount Vernon City projects $6 million shortfall as costs outpace capped revenue

Doug Voleski, the City of Mount Vernon—s director of finance, said the city faces a projected $6,000,000 shortfall this year because the costs of providing services are rising faster than the city—s revenues.

"The City is expecting a projected $6,000,000 shortfall because the cost providing services, things like labor, insurance premiums, maintenance, supplies, and equipment are rising faster than our revenue," Voleski said in a brief recorded statement. He listed the city—s primary revenue sources as "property tax, sales tax, federal, and state funding." Voleski added, "By law, the city has to adopt a balanced budget each year, meaning we can only spend what we bring in."

Voleski told residents that property-tax growth is legally limited and cannot fully offset rising costs. "The city's largest sources of revenue for operations are sales and property taxes, and the amount collected in property taxes is limited by state law to 1% increases," he said.

He also cited recent inflation trends and revenue performance. "Over the past 5 years, from 2020 to 02/2024, the consumer price index, which measures inflation, has increased an average of 5% each year, while the general fund revenue have averaged 1% less than in 02/2020," Voleski said. He said the city previously used general-fund reserves to absorb inflationary costs but that those reserves "have now been reduced to the minimum levels required by policy. So we can't use them anymore and have to come up with another funding solution."

The statement did not specify particular spending cuts, new revenue proposals, or a timeline for decisions. No formal council motion or vote was recorded in the statement. The explanation identifies the gap (rising operating costs and capped property-tax growth), the limits on the city's authority to raise property taxes, and the depletion of reserves as the immediate constraints the city must address.