Rockford Sun

A report provided to the city of Rockford by National Resource Network shows that the city is nearing bankruptcy due to salary and pension expenses exceeding revenue.

Rockford City Council 10th Ward Alderman Franklin Beach (R) said he would have to think about whether he felt municipalities should be allowed to file for bankruptcy.

"If bankruptcy were an option, then that would take control away from the local government and put it on the state, and they would have the right to do whatever they want to do with it," Beach said in an interview with Rockford Sun. "I’d be very concerned about that. I’d have to think about that."

Beach said he knows some states allow bankruptcy while others don't.

"I think that some of the budget deficits are created by other laws that make it very difficult, like our pension laws, and the requirement that they’re 90 percent funded at some arbitrary time in the future, which really does put a hardship on many municipalities," Beach said. "I think there are some things that could be done way before bankruptcy to get expenses and income lined up and some help from the state and re-aligning an arbitrary day and time in the future to fully fund pensions. I would have to have a lot more detail before I would say yes or no either way."

Beach said he believes Rockford, as well as other municipalities, must pursue all other avenues within their responsibility to bring expenses and revenue in line with one another.

"Just like anything else, you can’t continue to spend more than you bring in and expect to come up with a good result," Beach said. "I do think the pensions, for example, is certainly a very big issue. A lot of that is the fact that the state requires certain things of the municipalities…to accomplish certain levels that are in some respects unrealistic and create a break of responsibly for the city to fund them."

Beach said he thinks they need to look a little bit more and have a little bit more understanding and cooperation from the state.

"That would be a great help with bringing budgets in line," Beach said.

The report for National Resource Network was presented last month to city officials. National Resource Network started working on the report in January and provided Rockford with a seven-year financial plan that focused on improving the city's fiscal sustainability and economic competitiveness, according to National Resource Network's website.

The report suggests the city consider downsizing its police and fire departments, as public safety made up 78 percent of the general fund spending for Fiscal Year 2017. The report also suggests closing a fire station or selling the water system.