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Peoria finance director reports February unaudited results; council hears pension-funding and bond timing discussion
Summary
Finance Director Kyle Crady presented the unaudited financial report through Feb. 28, 2025, noting general-fund revenues lag budget early in the year, an expected FY2024 close near budget projections, and ongoing work on pension funding tools and potential pension-obligation bond timing.
The Peoria City Council on Tuesday received the city’s unaudited financial report for the period ended Feb. 28, 2025, and questioned staff about near-term revenue, the audit timeline, and pension-funding strategy.
Finance Director Kyle Crady told council general-fund revenues through February were about 12.6% below budget while expenditures were about 7.2% below budget for the same period. Crady said those variances are common in the first months of the fiscal year because many revenues (notably sales taxes) are reported with a lag and some revenues are accrued back to the prior year; he expected March and April reports to show revenue catching up, and he said preliminary indicators suggested the year-end result would be closer to budget.
Crady said the auditors are in the second week of field work on the 2024 audit and that, preliminarily, the city expects a general-fund shortfall of roughly $800,000 at year end — better than the $1.7 million deficit assumed during the budget process, leaving the city ahead by approximately $900,000 compared with budget assumptions.
Council members asked about the personal property replacement tax (PPRT), which Crady said has fallen since 2022 because of state adjustments and “clawbacks” of prior overpayments; the city uses PPRT mainly for police and fire pensions and some FICA costs.
On pension funding, Crady explained the city contributes at the actuarially requested amount above the statutory minimum to lower the long-term unfunded liability. He said the actuarial-versus-statutory gap was about $1.5 million this year, and the city’s 2025 budgeted pension payment was about $36 million compared with roughly $33.5 million in 2024.
Crady said the city engaged actuaries to build analytical tools to evaluate the timing for pension-obligation bonds and that market timing matters: bonds are potentially appropriate if borrowing costs are lower than the pension plan’s unfunded-liability growth, but issuing bonds carries investment and market risks. He and council members agreed municipal-bond tax-exempt status remains an open policy issue that could affect future financing options.
Council received the report on file unanimously. Staff will continue to monitor revenue and investment markets and report updated figures in upcoming monthly financial reports.
