County staff presented the economic development fund budget and a multi-year forecast showing the fund balance would be effectively exhausted in 2027 if current commitments continue. The Finance and Audit Committee agreed to move the FY26 proposed budget forward while flagging the need for a funding plan for future years.

Staff explained the fund originated from an old revolving loan program and now supports county partnerships and contracts, including the county’s contribution to the McHenry County Economic Development Corporation (MCEDC), which has a $175,000 contribution that offsets personnel housed on the county payroll; a $110,000 pledge to another county development partner (National McHenry County); a $50,000 membership to the regional planning council; and modest economic-incentive payments that are winding down.

A fiscal model staff showed projects the economic development fund balance falling from roughly $402,000 at the end of FY25 to a negative small balance in FY27 under the current budget scenario. Committee members discussed options: reduce or end participation in regional partnerships (such as GCEP/GSEP), seek alternative revenue streams, reallocate other county funds to provide a transition, or scale back grant and incentive commitments. Several members suggested that, for some initiatives, the intended outcome is to “work the fund down” as projects mature, while others urged preserving a base level of funding to sustain business-response and workforce programs.

The committee reached consensus to move the FY26 economic development fund budget forward to the next review stage and directed staff to prepare options for sustaining economic development work beyond the current one-time fund balance.

Ending — Staff will provide the county board with the forecast and a menu of possible funding strategies before final decisions on continuing economic-development commitments.