Evanston city officials have proposed a 2027 budget that includes an 8.9% increase in property taxes alongside significant hikes in fees for utilities and services, sparking debate among City Council members over the need for spending cuts. The fiscal plan, presented at the council meeting on October 12, also calls for a 25% increase in water rates, higher taxes on streaming services and rideshare apps, and increments in natural gas and waste collection fees.

City Manager Luke Stowe’s office indicated that the additional revenue would mainly support the parks and recreation fund and help replenish the city’s general fund reserves, which have been declining. The 2027 budget proposal features $349 million in expenditures, representing a 2% rise from the previous year. A $100 million capital improvement plan is slated to address infrastructure projects, including the replacement of nearly 10,000 lead service lines beneath residential streets.

Insurance and grant program costs are cited as some of the largest drivers of expense increases. Health insurance expenses for city employees are projected to climb about 17%, partly due to increased use of GLP-1 medications. The city anticipates drawing down its remaining reserves to cover a general fund deficit projected at approximately $6 million, improved from deficits ranging between $10 million and $12 million in recent years. This improvement partly reflects a 6.6% revenue increase linked to inflation and tax rate hikes.

For homeowners, the proposed property tax increase would equate to an additional $180 annually on a median-valued home worth $481,000. Streaming service taxes are planned to double from 5% to 10%, aligning with Chicago’s current rates, while rideshare fees would rise from 20 cents to 50 cents per ride originating or ending within Evanston. The natural gas use tax would increase from 2.5 cents to 5 cents per therm, waste pickup fees would grow by 5%, and a 5-cent hike would apply to the grocery bag tax.

Council members expressed concerns about the budget’s reliance on increasing taxes and fees rather than reducing city expenditures. Several aldermen urged staff to identify nonessential personnel positions as part of broader cost-cutting efforts, given that approximately 80% of general fund expenses are linked to staffing. Ald. Tom Suffredin and Ald. Matt Rodgers called for a thorough review of expenses beyond tax hikes, emphasizing the need for restraint as residents face higher costs.

CFO Hitesh Desai confirmed plans within the draft budget to eliminate seven full-time positions next year, though some council members argued that further reductions might be necessary. Ald. Clare Kelly highlighted challenges such as resident outmigration and advocated for salary reviews, especially among top-paid employees.

Conversely, Ald. Bobby Burns defended existing staffing levels, noting that recent hires aimed to reduce employee overload and maintain service quality. Burns said the council had not provided clear direction to the city manager on where to target employee reductions without harming service delivery.

The City Council is expected to continue deliberations on the proposed budget at its October 26 meeting, with tentative final approval scheduled for November 23. The fiscal year will run from January 1 to December 31, 2027.