Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Municipal Finance topic
No spam. Unsubscribe anytime.
Finance staff: 2025 shows multimillion‑dollar surpluses; board eyes reserves for infrastructure
Summary
At a Committee of the Whole meeting, Oswego finance staff presented a preliminary 2025 financial update showing a roughly $5.5 million general fund surplus driven largely by sales tax and interest income; trustees discussed using excess reserves to fund projects including a public works facility and Wolf's Crossing road improvements.
Andrea, a village staff member, told the Oswego Committee of the Whole that preliminary, unaudited figures for 2025 show a sizable surplus across multiple funds and that invoices and year‑end accruals could change final totals.
The village’s general fund was budgeted with a $675,500 planned deficit because reserves were earmarked for a public works facility, but Andrea said a point‑in‑time accounting shows a current general fund surplus of $5,500,000. “These are not final audited figures,” she said, adding that outstanding invoices and accrual entries remain to be recorded.
Andrea said budgeted revenue for the general fund was $28.3 million and the actual revenue recorded so far is about $33.6 million, roughly 115% of budget; actual expenditures at the time of the report were about $27.1 million, or 94% of budget. She identified sales tax and home‑rule sales tax as major drivers, together accounting for about 42% of general fund revenue.
On taxes, Andrea reported sales tax receipts of approximately $10.5 million on a budgeted $8.8 million (about 119% of budget) and home‑rule sales tax of about $3.6 million on a $3.1 million budget (115%). By contrast, use tax trailed at about $554,000 on a $900,000 budget (60%); Andrea said the gap resulted from a state reclassification of certain online sales based on business nexus and origin, which moved some receipts out of the use tax category and into sales tax.
Other revenue items outperformed projections: accessory permit revenue and plan‑review fees exceeded budget (plan review fee revenue was described as roughly 218% of budget), and interest income was notably high — Andrea reported $1.7 million in interest earnings on a $600,000 budget, which she attributed to conservative cash‑flow estimates and higher available reserves to invest.
Andrea also reviewed enterprise funds. The water and sewer operating fund was budgeted for a $4.5 million surplus; the reported surplus was about $5.3 million. She said the village is planning a gradual water‑rate increase to cover debt service tied to borrowing for a Lake Michigan connection. “We are doing a slow ramp up for those increased revenues,” Andrea said.
On financing, Andrea said a $20 million bond sale closed in July and the village expects another bond sale in the summer to finance the Lake Michigan project. She explained a timing issue in the water capital fund: many payments to the DuPage Water Commission were budgeted for 2025 but are being made in 2026, which reduced 2025 capital expenditures on paper.
Other funds noted: the parking fund had a small net excess (about $39,000) while permit and ordinance violation revenues underperformed; an RFP for collection services completed late in the year is expected to improve future compliance and revenue. The motor fuel tax fund exceeded spending by about $372,000 and some of those funds will roll into the road program for 2026.
Trustees asked whether the string of surpluses was mostly due to items outside village control. One trustee observed that sales tax growth and interest income — both tied to broader economic conditions — were driving much of the excess. Andrea agreed, noting the village’s fund balance policy directs excess reserves, at the board’s direction, into the capital project fund for one‑time costs.
Multiple trustees said they prefer using surpluses to pay for large capital needs rather than issuing debt. A trustee cited a study Andrea referenced that estimated up to 45% of sales tax receipts could come from non‑Oswego residents, an argument used to support investing in local infrastructure that draws visitors and commerce. Trustees highlighted projects such as the public works facility and the multi‑phase Wolf's Crossing widening as priorities for surplus funding.
The committee offered staff praise for keeping operating costs in check and for the unexpectedly strong revenue performance. Andrea repeated that final audited numbers will be reported after year‑end entries and external audit adjustments are complete. The Committee of the Whole adjourned and reconvened later for the village board meeting.
