TRANSMITTAL LETTER FOR BOARD MEETING OF JULY 17, 2025
COMMITTEE ON BUDGET AND EMPLOYMENT
Mr. John P. Murray, Acting Executive Director
Title
Report on Budgetary Revenues and Expenditures for the second quarter of 2025, ended June 30, 2025
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Dear Sir:
Attached is a report on revenues and expenditures for the second quarter of 2025, ended June 30, 2025. This report is prepared on an unaudited budgetary basis of accounting.
The second quarter 2025 Corporate Fund actual net tax revenue of $153.5 million is 47.5 percent of the budgeted tax receivable.
The Corporate Fund actual non-tax revenue of $76.6 million includes user charge income of $27.0 million, Tax Increment Financing distributions of $24.4 million, rental and easement income of $16.2 million, earned interest income of $6.5 million, and other miscellaneous revenues totaling $2.5 million.
The second quarter 2025 Corporate Fund expenditures of $200.7 million are 38.3 percent of the $523.7 million 2025 Corporate Fund budget. Two of the primary expenditure drivers, energy and healthcare costs, are monitored closely throughout the year. The current variance in energy expenditures (electricity and gas) is mainly attributable to timing of bill payments. Healthcare costs are $4.4 million higher than the same period in 2024 due to higher hospitalization claims for the active employee plans and significantly higher pharmacy costs due to substantial increases in specialty and diabetic/weight management drug costs.
The second quarter 2025 Personal Property Replacement Tax (PPRT) receipts total $28.6 million with $10.0 million allocated to the Construction Fund and $18.6 million allocated to the Retirement Fund. Compared to PPRT receipts of $40.8 million received in the same period in 2024, this is a decrease of $12.2 million. The decline in this economically sensitive revenue is due to planned adjustments made by the Illinois Department of Revenue to correct for over-distribution of funds and was anticipated in the 2025 budget.
The two primary economic factors driving District revenues are the real estate market and the Consumer Price Index (CPI). Through May 2025, the Illinois Association of Realtors reports that Chicago metropolitan area home sales are down 0.4 percent, while the median sales price has increased 7.1 percent compared to the same period in 2024.
According to the Bureau of Labor Statistics, the all-items index increased 2.4 percent for the 12 months ending in May. The all-items less food and energy index increased 2.8 percent over the last 12 months. The energy index decreased 3.5 percent for the 12 months ending in May, while the food index increased 2.9 percent.
According to Bloomberg, underlying US inflation rose in May by less than forecast for the fourth month in a row, suggesting companies are largely holding back on passing higher tariff costs through to consumers. Interest-rate swaps showed traders see a 75% probability that the Federal Reserve will cut borrowing costs by September.
The Budget Office will continue to closely monitor economic conditions, revenues, and expenditures throughout 2025.
Respectfully Submitted, Shellie A. Riedle, Administrative Services Officer
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