A deficit in housing development and sales tax has created a chain reaction in DeKalb’s budget, affecting city departments.

“The main reason is housing development is down about 30 percent, and sales tax is down, as well,” said Rudy Espiritu, DeKalb assistant city manager.

Sales tax was more than $225,000 under the projected budget, and building permits were $266,000 below the projected budget, Espiritu said.

“Revenues are not coming in to meet our expenditures,” Espiritu said.

While revenues are growing about 4 percent, expenditures are growing about 6 to 6.5 percent, and this is expected to continue over the next five years, Espiritu said.

To combat this, the city has already taken action by asking departments to cut 10 percent from their budgets this year, among other things.

“We had a hiring freeze in effect for all personnel in city departments except for fire and police, reduced training and traveling expenses, and reduced overtime,” Espiritu said.

Dave Baker, 6th Ward alderman for DeKalb, said the council was first presented last fall with the forewarning that there would be a negative cash flow if something were not done.

The city then had to adjust the budget, looking at every single expense.

“We couldn’t continue spending at the rate we were,” Baker said. “By taking proactive steps now to balance our budget for the future, it prevents us from spending as much as we have to.”

Baker said with factors such as wages being compounded yearly, the city of DeKalb is not the only community having this problem.

“I think it’s not just a problem facing DeKalb but the country,” Baker said.