Rockford Sun

Rockford is in better shape to face the economic downturn caused by the COVID-19 pandemic and business shutdowns, thanks to a total emergency $37.7 million “rainy day” fund.

But city leaders concede the unknown economic future looks potentially bleak.

“We have to be ready to act, move and make decisions to keep things afloat and I think we have the will and capability to do that,” City Alderman Frank Beach, a Republican, told the Rockford Register Star. “Until we get a handle on the numbers, it’s hard to make those kind of predictions. The cushion that we have doesn’t take pressure off, but it gives a little more room to think, discuss and come up with better plans.”

With businesses closed by stay-at-home orders, city officials are facing unknown but potentially damaging revenue losses this year. Sales taxes that make up roughly a quarter of city’s general fund have taken a big hit and rising unemployment claims could mean far less than expected in income tax collections.

As of May 15, Illinois reported 90,369 confirmed cases of the coronavirus, including 4,058 deaths. Winnebago County has 1,390 confirmed cases of COVID-19.

Figures released in an audit show that the City of Rockford ended 2019 with a $3.5 million surplus, after a $3.6 million surplus in 2018, adding to the total amount in coffers.

While the city has money to deal with the pandemic, Finance Director Carrie Hagerty took a somber tone about its long-term impact. She said it is difficult to know how hard city finances will be hit this year. With more sales taxes collected from online purchases, it is possible the hit could be lessened a bit.

“This is really the type of situation that fund balances are designed for,” Hagerty said. 

Beach said he is confident the city will come up with solutions to deal with revenue losses, but much remains unknown about how bad it will be.