TRANSMITTAL LETTER FOR BOARD MEETING OF NOVEMBER 7, 2024
COMMITTEE ON BUDGET AND EMPLOYMENT
Mr. Brian A. Perkovich, Executive Director
Title
Report on Budgetary Revenues and Expenditures for the third quarter of 2024, ended September 30, 2024
Body
Dear Sir:
Attached is a report on revenues and expenditures for the third quarter of 2024, ended September 30, 2024. This report is prepared on an unaudited budgetary basis of accounting.
The third quarter 2024 Corporate Fund actual net tax revenue of $300.6 million is 90.4 percent of the budgeted tax receivable, an increase of $141.5 million since the second quarter of 2024.
The Corporate Fund actual non-tax revenue of $87.1 million is 87.2 percent of the budgeted non-tax receivable and includes user charge income of $33.4 million, rental and easement income of $24.7 million, interest income of $11.6 million, TIF distributions of $10.8 million, and other miscellaneous revenues.
The 2024 third quarter expenditures of $314.4 million are 63.2 percent of the $497.3 million Corporate Fund budget. Two of the primary expenditure drivers, energy and healthcare costs, are monitored closely throughout the year. Energy expenditures (electricity and natural gas) are $13.7 million higher than the same period in 2023 and are mainly attributed to Carbon-Free Energy Resource Adjustment (CFRA) rate changes and increased electricity usage, while healthcare costs are $2.3 million lower than the same period in 2023 due to significantly lower hospitalization claims.
Personal Property Replacement Tax (PPRT) receipts total $57.0 million with $13.9 million allocation to the Corporate Fund, $25.0 million allocation to the Construction Fund, and $18.1 million allocation to the Retirement Fund, compared to the $97.5 million received through the same period in 2023. While a decline was anticipated in the 2024 budget, the actual results are lower than expected.
The two primary economic factors driving District revenues are the real estate market and the Consumer Price Index (CPI). Through September 2024, the Illinois Association of Realtors reports that Chicago metropolitan area home sales are down 3.5 percent, while the median sales price has increased 7.7 percent compared to the same period in 2023.
According to the Bureau of Labor Statistics, the all-items index rose 2.4 percent for the 12 months ending in September. The all-items less food and energy index rose 3.3 percent over the last 12 months. The energy index decreased 6.8 percent for the 12 months ending in September and the food index increased 2.3 percent over the last year. According to Reuters, U.S. consumer prices rose slightly more than expected in September amid higher food costs, but the annual increase in inflation was the smallest in more than three and a half years. In September, the Federal Reserve lowered benchmark interest rates by a half percentage point. The central bank is expected to continue lowering interest rates, though the pace and degree remain in question. Federal Reserve officials have become more confident that inflation is easing back to their two percent goal while expressing concern over the state of the labor market.
The Budget Office will continue to closely monitor economic conditions, revenues, and expenditures throughout 2024.
Respectfully Submitted, Shellie A. Riedle, Administrative Services Officer
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