If businesses are the engine that moves Northbrook, that engine seems to be revving back to life.
Sales tax revenues this year came in higher than the village expected, while retail shopping center occupancy rates are also up by 30 percent, according to Village President Sandra Frum.
At a luncheon for members of Northbrook’s , Frum said the economic outlook in the village is—for the most part—looking good.
“You guys truly are the engine that moves Northbrook,” she told the several dozen local business owners who gathered at the . “I think we’re in very good shape, economically.”
Compared to towns like Evanston, Skokie and Glenview, Northbrook has several hundred more businesses, Frum said. In fact, the village’s daytime population of roughly 45,000 is significantly higher than its —underscoring the importance of business in the community.
And businesses should be seeing an uptick in sales, given Northbrook’s most recent sales tax revenues. According to Frum, the village budgeted for a 3 percent increase in sales tax figures during 2010, but receipts have actually come in more than 7 percent higher than the prior year.
Another positive sign comes in occupancy rates. With new stores like , and H&M coming to town, the vacancy rate has gone down by 32 percent in Northbrook’s retail shopping centers. Hotel occupancy rates and room rates have also gone up, meaning more revenues for the village in the form of hotel sales taxes.
“We think things are better than they were and we’re seeing that in Northbrook,” Frum said.
Village’s Economic Health Looks Sound
The village budgeted for a roughly $500,000 deficit this year, but that’s not necessarily a sign of economic malaise, according to Frum. Northbrook has excess money in reserve and the village board decided to use that money to close the gap in the 2010-11 budget rather than tax residents further, Frum said.
Another sign of Northbrook’s economic vitality is its Triple A bond rating, the highest possible rating an entity can receive. According to finance director Jeff Rowitz, the village of Northbrook is one of only four communities in Illinois to receive a Triple A rating from both rating agencies this year.
“We’re in a very enviable position when we go out for bonds,” Frum said.
While police and fire pensions are not fully funded in Northbrook, Frum said the village was doing well compared to other municipalities in the area. In Evanston, for example, funding for police and fire pensions was at only about 40 percent as of July 2010. Northbrook’s police and fire pensions are both funded at more than 70 percent, according to Frum. The pensions were fully funded a few years ago, but took a hit in the stock market, she said.
State Budget Woes Could Impact The Village
Going forward, Frum said one of her biggest economic concerns for the village was “keeping the state out of our pockets.”
Given the condition of the statewide budget, Illinois legislators are looking at funding sources that municipalities depend on, according to Frum—including a portion of the state income tax that has historically gone to municipalities.
“It’s something I’m keeping a very strong eye on,” she said.
In the future, Frum said the village was looking to maintain its strong financial situation by sharing services among departments and nearby communities to cut costs. Recently, the village has looked into forming a consortium with seven other local governments to go out to bid for .
Frum said that the village is also trying to cut costs by considering the worth of each position when an individual leaves or retires. Rather than filling the position right away, if at all, Northbrook may fill the gap in labor with “judicious use of overtime,” according to Frum. While an employee may be paid more per hour with overtime, the village does not have to pay other costs such as health insurance and pensions for an additional employee in that scenario.
Village Sets Its Sights On Downtown Development
The picture Frum painted of Northbrook’s economic situation was largely a rosy one. But she did acknowledge one area of weakness: Northbrook’s central business district.
With the help of , the village recently hired a consultant to design a downtown development plan to increase the number of businesses and create a more unified feel for the area. Over the course of one week in October, village administrators and consultant Teska Associates met with business owners, developers and residents to .
Suggestions included a parking garage combined with luxury apartments at the and a redesign of the Meadow Road shopping plaza.
“Now we have a much, much better idea of what the downtown will look like,” Frum said.
That plan will help Northbrook approach developers for the area, and Frum said some developers have already contacted the village in response to some ideas for the Metra lot.
“You probably can tell I’m really excited about this,” she said.
Tentative Numbers Show Good Holiday Sales
Northbrook businesses recently took the test of Black Friday sales—and so far, their reported earnings seem to support Frum’s diagnosis of good health in the village. While final numbers aren’t in for most businesses, Chamber of Commerce President Tensley Garris said that she was hearing positive things.
“Anecdotally, people are reporting good sales,” Garris said.
At , a number of retailers reported that they had beat their projected sales for Black Friday, according to senior general manager Caryn Torres.
Within the last three months, the mall added 45,000 square feet of new business. Joining the ranks at Northbrook court this fall was an H&M and luxury sporting goods store, among three other new businesses.
“The new merchants also told us that they were above their projections,” Torres said. “It was a fun time.”