To balance the $140 million budget, the council will raise the city’s share of property taxes by 2.57 percent, use a $200,000 rebate on natural gas taxes and implement a .25 percentage-point increase in sales taxes.
Aldermen did not vote on a previously proposed measure that would raise sales taxes on packaged liquor by 2 percent.
The budget, which faced a $2 million deficit and a March 1 approval deadline, will reflect a $16,010 surplus without the property tax hike, but other city expenditures – including police and fire department pensions and interest on city debts – will cost an additional $660,000.
Ald. Dennis Drummer (2nd) applauded the council for passing a budget that included a smaller property tax increase, which will represent a .47 percent raise in a resident’s overall property taxes.
A resident who owns a home worth $215,000 will pay $37 more in property taxes each year. According to City Manager Roger Crum’s original proposal, that resident would have paid an additional $135.
“We have done a great job,” Drummer said of the increase, which is the city’s third property tax increase in the past three years after an eight-year freeze.
“We’ve come from 9.4 percent to 2.5 percent,” he said.
Much of the budget debate focused on a motion by Ald. Melissa Wynne (3rd) to remove the $200,000 natural gas tax rebate from the budget.
She argued that the rebate, which the city will receive from the gas company based on residents’ gas bills, is a one-time revenue that the city may not receive again.
“Every year we’re going to be tempted by a number, and it might be a big number,” Wynne said.
She argued that because residents’ gas bills have been much higher than normal in the past year, it would be inappropriate to incorporate the higher rebate into the budget. Instead, she urged the council to move the sum to the city’s capital improvements fund, which is not part of the budget.
Drummer told Wynne he could not support her motion because the rebate would balance the budget.
“You’re right. I’m not disagreeing (that it is a windfall),” Drummer said. “But if I can find a way to keep from increasing property taxes this year, I would rather not (exclude the rebate from the budget).”
Ald. Steven Bernstein (4th) also said he wanted the rebate to remain in the budget.
“I really don’t believe it is a one-time revenue,” he said. “This year, it’s a gusher, but it will always be some number. I have no problems leaving it here.”
The council voted 8-1 to keep the rebate in the budget, with Ald. Arthur Newman (1st) casting the lone dissenting vote. He also was the only alderman to vote against approving the budget, disagreeing with the inclusion of the gas tax rebate.
As part of the city’s 10-year-old long-range sewer improvement plan, the council also raised sewer fees by 10 percent, meaning residents will pay about $37 more a year.
Earlier in the meeting, Karl Gromelski, who is running for Seventh Ward alderman in the April 3 municipal elections, presented a check for $1,000 to the council.
During citizen comment, he told the council that many programs in the budget were superfluous. One of the items, a $1,400 youth golf program, could be underwritten by business donations, he said.
“I will write the letters, I will look for grant money,” Gromelski said. “If I can’t find the money, then I’ll write you a check.”
A short time later, at the beginning of the budget discussion, he produced the check.
“I move that the city accept the check and thank Mr. Gromelski very heartily,” said Ald. Stephen Engelman (7th), who will square off against Gromelski and two others in the election.
The council then added $1,000 to the budget, with Engelman promising to return the money if Gromelski produces grants from businesses that cover the golf program.
Not all of the revenue in the budget is accounted for. Aldermen will formally vote March 12 whether to implement the sales tax increase, which will bring the city an estimated $900,000 a year.
