Cook County is expecting a $218 million budget gap, but won’t plug it with layoffs or tax hikes

Cook County officials are projecting an estimated $218 million budget gap next year, the biggest since 2021, a year into the COVID-19 pandemic.

Officials would not detail how they plan to plug the shortfall, but Cook County Board President Toni Preckwinkle said it will not include layoffs of government employees or new taxes or tax hikes for residents. One potential solution could be to tap an estimated $367 million surplus projected for the end of the current budget year.

During a media briefing Tuesday, Preckwinkle said she’s not losing sleep over how to fill the gap, crediting her financial team with delivering a balanced budget year after year. She was elected in 2010.

“Believe me, we’ve seen worse,” Preckwinkle said. “When I came into this job [the gap] was $487 million and the total budget was a lot less. We had to make 15 percent cuts. I had to lay people off.”

Preckwinkle and her finance team unveiled what next year’s budget could look like and offered a glimpse into how Cook County might end the current fiscal year on Nov. 30. Cook County is one of the biggest counties in the nation, with a roughly $9 billion budget this year.

A persistent challenge continues: the struggle to hire workers. There are around 19,000 employees and some 4,000 vacancies.

And this summer, the government plans to survey residents to help figure out which programs to keep that have been launched with $1 billion in pandemic relief dollars. Some of these programs have given Cook County national recognition — guaranteed income and erasing medical debt for residents.

Now Preckwinkle will spend the next several months negotiating with elected and appointed county leaders who run the government’s public jail, courts and large hospital and clinic system called Cook County Health. The county has a legacy and a mission to treat people no matter whether they can pay.

Where Cook County finances stand

There’s a silver lining for the county in having trouble wooing and retaining employees: payroll savings.

County finance officials say that’s contributed to the estimated $367 million surplus projected for the end of the current budget year. So has the growing economy and higher-than-anticipated interest rates, fueling a likely increase in income from investments. And people spending more means more sales tax flowing into county coffers.

Cook County Health is doing a better job of getting reimbursed by insurance companies by making sure doctors document every service they provide when they bill, said Pamela Cassara, the health system’s chief financial officer.

“For a very long time in the county, I’m sad to say, there wasn’t a lot of emphasis on trying to collect money,” Preckwinkle said.

The effort also involves enrolling patients in health insurance plans if they qualify, another way to make sure Cook County Health can get paid for treating patients.

A projected budget gap awaits

But next year is potentially a different story. Effective June 2025, the county plans to give 5 percent cost-of-living adjustments to employees and as salaries increase, so do the pension contributions the county expects to make. This is driving the estimated $218 million budget gap next year. County budget director Kanako Ishida Musselwhite said it’s too early to say how the county plans to fill the gap.

Even though there’s the big surplus projected for the end of this year, the county typically tries to avoid “using one-time revenues for ongoing expenses,” said Dean Constantinou, county deputy chief financial officer.

“That way we’re not creating structural deficits in our budgets,” Constantinou said. “That has been what we have been doing for the last 10 years.”

Through the fall the county will negotiate with bureau and department leaders to look for ways to cut. One factor that could help next year is a higher reimbursement rate for members of the county’s large Medicaid health insurance plan called CountyCare. That means the county would be paid more for the medical care it provides to low-income patients.

Which pandemic-funded programs to keep

One of the biggest boons to governments across the U.S. during the pandemic was money to help the economy recover. Cook County is using the dollars to fund 73 programs focused on health care, economic development, criminal justice and other areas.

Constantinou said the county will “obligate” all of the money by the end of this year and must spend it all by the end of 2026.

“We do not want to give a single dollar back to the federal government,” he said.

So far the county has spent about 42 percent of the $1 billion received, which Constantinou said is on par with other county governments across the U.S.

Now comes the hard part: picking which programs to keep. One factor is how much impact the programs have made.

The county has set aside about $166 million in reserves to fund some programs beyond 2026, giving the government time to find grants or other ways to keep the programs alive.

A public hearing is scheduled for July 17 where residents can weigh in on the county’s financial plans. County board commissioners typically approve next year’s proposed budget in late fall. The new fiscal year begins Dec. 1.

Kristen Schorsch covers public health and Cook County government for WBEZ.