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Rock Island reports third‑quarter 2025 finances on track but flags use‑tax shortfall
Summary
City finance staff told the council that third‑quarter 2025 revenues generally tracked benchmarks — sales tax exceeded expectations while use tax is projected about $800,000 short — and outlined fund‑level variances and one reporting error in wastewater net position.
City finance staff presented the 2025 third‑quarter financial management report on Jan. 13, saying overall revenues and expenditures were largely on pace but noting material differences among specific funds.
The report, presented to Mayor Ashley Harris and council members, showed general fund revenues at roughly 72% of the annual budget with expenditures at about 64%. Sales tax receipts were above budget — reported at 116.2% of expected receipts — while use tax revenues lagged, the presenter said, projecting an approximate $800,000 shortfall tied to recent state law changes. "Projections anticipate a shortfall of about $800,000 compared to budget due to the state law changes," the presenter said during the meeting.
Among special funds, TIF revenues were at 79% with expenditures low, and the riverboat gaming fund showed revenue near benchmark but expenditures low because the majority of transfers were completed later in the year. The MLK Community Center operations showed revenue at 38% and expenditures at 84%, driven by a reimbursable siding repair paid from CDBG and a DCEO grant; finance also reported a $195,000 transfer from the general fund to support center operations.
The presenter noted a formatting error in the packet: the wastewater treatment net position appeared in red when it should have been black to reflect a positive position for September. Staff outlined that ARPA outlays were low in the quarter after deferred‑revenue adjustments and that the Housing and Community Development Fund showed revenue timing effects tied to federal drawdowns.
Council members asked follow‑up questions about the use tax decline and whether budget adjustments were planned for 2026; finance staff replied that the 2026 budget had been adjusted "significantly for 2026." The presentation closed with staff offering to provide additional documentation on specific items on request.
The council received the report and declined to take further action at the meeting; the finance office will continue revenue monitoring and report as projections change.
