Virus may hurt finances

Virus may hurt finances
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Virus may hurt finances

Lyons financial director warns of fiscal challenges 

By Steve Metsch

Lyons Finance Director Dan Denys cautioned the village board, at its most recent meeting, that it may face financial challenges because of the virus.

Like most communities in the nation, Lyons could be impacted negatively by the coronavirus pandemic in terms of less sales tax revenue. That’s because many businesses were closed down.

Denys addressed the situation at the June 2 meeting of the finance committee before the regular village board meeting.

The first quarter report for sales taxes were down. A partial close down in March has impacted Lyons, he said, along with two businesses that moved out of town.

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“That one of our financial challenges we’re going to have to deal with,” Denys said. “The same goes for gaming taxes. That’s down slightly.”

money $20 dollar bill, dollars, cash

Sales taxes for the second quarter should be available soon, he said.

“The general fund is holding its own, but we expect substantial decreases in sales tax, state income tax,” Denys said.

Food and beverage taxes “will see some reduction there,” he added.

“The long and short of it, we’re in a very tight situation,” Denys said.

“The biggest negative I see now is our sales taxes and what’s going to happen to our revenues when they get hit by the ensuing reductions,” Deny said.

Right not, the village’s general fund is in good shape.

“We’d love to break even for the year,” Denys said.

Mayor Chris Getty added, “what Dan is saying is when you go shopping, shop local, shop in the village of Lyons. Buy a car at Jack Phelan. Or two.”

The village is in the process of submitting its information to rating agencies. It’s possible Lyons, like many communities, could be downgraded a bit.

The village has $1.5 million in reserve, which represents about two months revenue, Denys said.

“That being said, if we lose, and our losses could be from $500,000 to $1.2 million next year,” Denys said. “So, think about that. We would basically wipe out all our reserves just based on this COVID issue.”

Denys is expecting “a substantial restoration of revenues in the third and fourth quarter,” which would have a positive impact on the village.

Village departments have been asked to see where they can trim costs.

“Everything’s on the table,” Denys said.

Desplaines Valley News

 

Steve Metsch
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