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Kane County finance director reports 2025 reserve use lower than budgeted; board debates how to measure 90-day general fund reserve
Summary
Finance presenter Kathleen told the Executive Committee that 2025 draw from reserves will likely be about $18.8 million (better than the $27 million budgeted) and that the 2026 budget anticipates using $6.4 million of reserves; board members asked the county to clarify whether the 90-day reserve policy applies to a single account or six accounts that comprise the general fund.
The Kane County Executive Committee heard a budgetary update from finance staff on the county general fund and its reserves, prompting board members to press for clearer policy guidance on how the county calculates a 90-day reserve.
Kathleen (finance presenter) explained that the county’s general fund comprises six accounts that must be reported together under governmental accounting rules: the general account, public building commission fund, cost-share drainage fund, economic development fund, domestic violence fund, and a special reserve account. She said budget-to-actual work indicates the county likely used about $18.8 million of reserves in 2025 compared with a $27 million budgeted drawdown, and that the 2026 budget anticipates using roughly $6.4 million of reserves.
“I would point out ... transfers in and transfers out are budgeted and we track them budget to actual,” Kathleen said while walking through the general ledger and reporting process. She told the committee auditors will begin final fieldwork and the annual audit is expected to be completed by May 31.
Board members sought a clearer policy definition of the 90-day reserve requirement: should the 90 days be calculated on the general account only, the general account plus the special reserve, or on all six accounts that together are reported as the general fund? Several members said that ambiguity could lead to mistaken conclusions about whether the county meets its policy requirement and asked the state’s attorney and finance to draft a clarified policy for board consideration. Finance agreed to return with suggested policy language and comparative practices from other counties.
Kathleen also reviewed tax revenue trends for 2025: state sales tax and RTA sales tax were slightly higher than prior year and budget, local use tax is lower due to law changes, and state income tax timing makes early trend analysis difficult. She noted the county motor fuel tax increase approved by the board will take effect July 1, 2026 and that related revenue will be realized later.
Committee members directed finance to provide an update on 2026 performance at the March finance committee meeting and to propose clarified language for the reserve policy so the board can be precise about compliance and expectations.
