Administrator says overall finances are strong
byRobert J. Lifka
For the second year in a row, tax changes at the state level are overshadowing the River Forest village budget.
A year ago, it was the threat of losing sales tax revenue with the elimination of the 1% state sales tax on groceries. This year, it’s the impact of a change to the classification of sales taxes on goods purchased out of state.
State officials eventually eliminated the grocery sales tax last year but allowed individual municipalities to institute a local grocery tax that will offset the loss. River Forest officials approved the local grocery tax April 14.
The five trustees present voted unanimously at the April 28 village board meeting to adopt the FY2026 general fund budget. The balanced budget, which was adopted without discussion as part of the consent agenda, was presented at a special committee of the whole meeting April 14.
Trustee Lisa Gillis did not attend April 28. The April 14 presentation was followed by a public hearing at which no member of the public spoke.
Covering non-recurring expenditures with cash reserves for the third year in a row balanced the budget.
Estimated total revenues for FY2026 are $21,046,487, up from $20,505,784 in FY2025. Estimated total expenditures for FY2026 are $21,207,948, up from $20,922,908 in FY2025. A deficit of $161,461 is due to $173,725 in nonrecurring expenditures that will be covered by reserves. Thebudgetshows a surplus of $12,264.
The fiscal year starts May 1 and ends April 30, 2026.
Revenue projections for Fiscal Year 2026 will be impacted by a change made by the state regarding classification of sales taxes collected on goods purchased out of state for use or consumption in Illinois, a change that will impact all municipal governments but will differ by community. This tax formerly was distributed per capita but now it is being determined by the jurisdiction where the item is shipped or delivered.
Beginning Jan. 1 all retail sales originating from outside of Illinois and made to Illinois customers by retailers with physical presence nexus with Illinois are subject to destination-based Retailers’ Occupation Tax (ROT) rather than Use Tax, according to the Illinois Municipal League. Previously, Use Tax was collected statewide and allocated to local governments based on population, regardless of the shopping habits of residents. Now, ROT (sales tax) collections and allocations are determined by the jurisdiction where the item is shipped or delivered or at which possession is taken by the purchaser.
Revenues are received in arrears with the state distributing revenues three months after they are collected. This regulation was put into effect in January but municipalities did not receive their first payments until April.
“We were aware of the change and adjustments were made to future revenue projections, but we are uncertain if the projections will need further review,” said Rosemary McAdams, finance director. “We will review after we see future collection amounts.”
Use taxes are a form of sales taxes that a purchaser owes on goods purchased out of state for use or consumption in Illinois, according to the Illinois Municipal League. If a seller does not collect the use tax, the purchaser is required to pay the tax to the state, which then distributes the revenue to counties, municipal governments and other governmental agencies after keeping a percentage for the state.
Matt Walsh, village administrator, who presented the budget with McAdams, said the village finances “overall are in a strong position.”
“I applaud all,” said Cathy Adduci, village president. “I thank Matt, Rosie and everybody for doing this hard work.”
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