Tax Hike Decisions Coming Monday

As of this writing, the agenda for the June 9 Council meeting is not yet posted online, so must depend on Chronicle coverage:

In March, the sales tax was raised and a motor fuel tax was established to address the city’s budget shortfall. An audit projected that the city’s general fund would have a $500,000 shortfall by June 30, the end of the city’s 2008 Fiscal Year.

The natural gas, electricity and hotel-motel tax increases scheduled for discussion Monday are included in the city’s 2009 proposed budget to generate funds for the next fiscal year, Assistant City Manager Rudy Espiritu said during a news conference Thursday. These revenues are also part of the city’s five-year financial plan.

The water and waste rate increases are to cover rising costs of services, Espiritu said. Some increases could go into effect as early as July if approved.

That’s not entirely correct, Mr. Espiritu. Take the water rate increase. If the city would stop siphoning off a half-mil-plus from the Water Division into the General Fund, Water would be paying for itself quite nicely. You, with Council’s complicity (Council has to approve these transfers) need that money to cover the nice raises you are giving yourselves, as well as that $800,000 insurance shortfall carried over from last year.

Raises in a budget crisis via tax hikes that we can’t afford. Hunh. My neighborhood is having its yard sales this weekend but we are not selling our torches and pitchforks.

p.s. Notice that nobody’s really talking about the city’s property tax levy? I bet they hike that next and I bet, when it comes, we’ll be scraping our jaws off the floor.

26 thoughts on “Tax Hike Decisions Coming Monday”

  1. I was told agenda would be posted today. I thought agendas were usually posted on Thursday but I’m now at the age where breakfast is often a forgotten memory.

    Unless the police station is placed on the property tax, I’m betting th only raise in property tax will be to match the required contributions to IMRF. (Unless there is some trade off from a reduced sales tax and property tax)

    That being said: I am in agreement with you on the budget concerns if not the pitchforks. The transfer from the water fund is a conventional ‘trick’ in budget balancing but it is a trick. Visibility in budgeting is a basic requirement and that means making clear the transfer between funds and (this is redundant) the unattributed costs to our version of O’Hare.

    What I am looking for are four things right now (a) a large part of the suggestions made for saving thousands and tens of thousands especially those made by the advisory board be accepted in a reduced budget. Not all the suggestions are viable and on some sincere disagreement on them exists, but savings better occur here. Some are easy, the 100k for the unneeded consultant goes; others are harder involving policy differences and need to be phased in (b) Indications that work is underway on the broader structural problems of the budget that cannot be solved immediately (You can’t and shouldn’t abnegate a union contract midstream; for one thing its illegal; but the gorilla savings are in issues surrounding wages and fringes. (c) the promised motion to reduce the sales tax increase actually materialized in August (or whenever it was promised) (d) Steps toward making budgeting more public be continued. To be blunt the change from the previous process to the current one is a change from night to day. As a long term, a very long term, advocate of such change I’m pleased as punch at the multiple public hearings and the advisory board. Now to keep up my pleasure we need to institutionalize these changes and then add another one — changing budget format so that those of us who are extremely near sighted and those who don’t know government structure can more readily understand the document. Dollars need to be better linked to programs and backup material for understanding the budget also needs to be on-line with links (though posting union contracts is a good step in that direction).

    I suspect dinner (using torches to light barbecues is a more peaceful approach) prior to Monday’s meeting might be in order as it most likely will run long.

    Remember the public hearing for the budget is still open so that public hearing type of testimony is possible

    I think I’ll cc this to council if i can figure out how.

    herb r

  2. Another plea for three minutes of face time. Change in direction requires public participation in the following meetings, Monday and Tuesday, June 9-10 at 200 South Fourth Street (Council chambers). If you are unable to attend please email your city council member(s) and let them know if you want more cuts or more taxes. ( mailto:
    kpovlsen@cityofdekalb.com;
    dbaker@cityofdekalb.com;
    frank.vanbuer@cityofdekalb.com;
    bertrand.simpson@cityofdekalb.com;
    victor.wogen@cityofdekalb.com;
    ronald.naylor@cityofdekalb.com;
    brent.keller@cityofdekalb.com

    Or: go here to do the one-click thing at the city website)

    Please copy this comment and email it to your community neighbors and friends:

    PUBLIC HEARINGS:
    1. PUBLIC HEARING IN REFERENCE TO THE CITY’S INTENT TO AMEND THE TAX INCREMENT FINANCING (TIF) REDEVELOPMENT PLAN AND PROJECT FOR THE CENTRAL REDEVELOPMENT PROJECT AREA.

    2. CONTINUED PUBLIC HEARING ON THE PROPOSED CITY OF DEKALB, ILLINOIS FY-2009 ANNUAL BUDGET, STAFFING PLAN AND THE FY-2009 THROUGH FY-2013 FIVE YEAR GENERAL FUND FINANCIAL AND CAPITAL PLAN.

    J. ORDINANCES – FIRST READING:

    1. ORDINANCE 08-30
    APPROVING THE CITY OF DEKALB, ILLINOIS FY09 BUDGET, STAFFING PLAN, AND THE FY09-FY13 FIVE YEAR GENERAL FUND FINANCIAL AND CAPITAL PLAN.
    Note: Likely to receive and file (a formality) but…

    2. ORDINANCE 08-33
    AMENDING THE MUNICIPAL CODE OF THE CITY OF DEKALB, ILLINOIS, CHAPTER 62, BY CHANGING THE TITLE TO “NATURAL GAS TAX,” AND SECTION 62.03, “TAX,” BY INCREASING THE CITY IMPOSED TAX RATE FROM TWO TO FOUR CENTS PER THERM.

    3. ORDINANCE 08-34
    AMENDING THE MUNICIPAL CODE OF THE CITY OF DEKALB, ILLINOIS, CHAPTER 63, “UTILITY TAX,” SECTION 63.01, “TAX IMPOSED,” BY INCREASING THE TAX ON ELECTRICITY.

    ASSISTIVE SERVICES WILL BE PROVIDED UPON REQUEST

    Agenda, Regular Meeting of City Council, June 9, 2008, Page 3 of 3
    ASSISTIVE SERVICES WILL BE PROVIDED UPON REQUEST

    4. ORDINANCE 08-35
    AMENDING THE MUNICIPAL CODE OF THE CITY OF DEKALB, ILLINOIS, CHAPTER 55, “HOTEL-MOTEL TAX,” SECTION 55.02, “TAX,” BY INCREASING THE CITY IMPOSED TAX RATE FROM FIVE TO SIX PERCENT.

    5. ORDINANCE 08-36
    AMENDING THE MUNICIPAL CODE OF THE CITY OF DEKALB, ILLINOIS, CHAPTER 7, “WATER SERVICE,” SECTION 7.18, “WATER RATES.”

    6. ORDINANCE 08-37
    AMENDING THE MUNICIPAL CODE OF THE CITY OF DEKALB, ILLINOIS, CHAPTER 7, “WATER SERVICE,” SECTION 7.18-6, “WATER SERVICE FEES.”

    7. ORDINANCE 08-38
    AUTHORIZING THE MAYOR OF THE CITY OF DEKALB, ILLINOIS, TO ENTER INTO A LEASE WITH OPTION TO PURCHASE WITH ELLIOTT & WOOD, INC., FOR A PORTION OF PROPERTY AT THE EAST END OF INDUSTRIAL DRIVE.

    8. ORDINANCE 08-39
    AMENDING THE MUNICIPAL CODE OF THE CITY OF DEKALB, ILLINOIS, CHAPTER 15, “REFUSE, RECYCLABLES AND LANDSCAPE WASTE COLLECTION,” SECTION 15.04, “FEES.”

    9. ORDINANCE 08-40
    REZONING PROPERTIES GENERALLY BOUNDED BY SEVENTH STREET, PLEASANT STREET, FOURTEENTH STREET AND SYCAMORE ROAD, INCLUDING A SMALL AREA WEST OF SEVENTH STREET, NORTH OF DAVY STREET, FROM “SFR-2” SINGLE FAMILY RESIDENTIAL, “MFR” MULTI FAMILY RESIDENTIAL, “TFR” TWO FAMILY RESIDENTIAL AND “LC” LIGHT COMMERCIAL TO “RC-I” RESIDENTIAL CONSERVATION DISTRICT.

  3. They already hiked the property tax on this years assessment. It will have to go down to reflect lower housing prices. The market under $200k is ok, over 200K is horrible.

  4. That is one BUSY agenda. Lots of potential damage to the taxpayers, who are already hurting. Did y’all hear today: unemployment at 5.5%, biggest one-month jump in 20 years.

    Between that and the climbing number of foreclosures, do they REALLY REALLY think they can continue this way and have it turn out all right?

    I’ve been busy reading about TIF–and thank goodness, because I didn’t actually expect it to come up this soon.

  5. You will not want to look at the stock market report from today. One word = Nosedive.

    You will not want to look at the prediction of $5 per gallon gas by July 4th either.

    I thought Friday the 13th was not until next week.

    To the people in the media who thought yesterday’s rally was the sign that end of the hole is near, Warren Buffet must be sitting in Omaha thinking “I told you so” already.

  6. Some notes on the FAC recommendations link posted above a couple of posts…

    From Mariane Anderson:
    Budget “Self-sufficient” Funds to spend only the revenues generated.

    Spot on!

    a. Development Services Fund. Established in 2005 with a goal of being selfsupporting without General Fund Assistance. Overspent in 2008 and
    budgeted to overspend in 2009.

    A clear example why “no fee charged in the state of Illinois shall be used to pay government salaries…”

    b. Economic Development Fund. This is a new fund pending for FY2009. It is based on the Hotel/Motel Tax Revenue. The budget expenses should be to equal revenues.

    The selected arms of this fund and its purpose are ReNew DeKalb and the Chamber. I still maintain that these groups should submit their objectives with stated revenue goals for FY09. How much sales tax will their efforts bring in, for example. The CVB (part of the chamber) should provide “heads in beds” projections for their use of tax dollars, too. Head in beds visitors, both recreational visitors and business visitors spend considerable amounts of money in the towns they sleep in.

    From Cohen Barnes:
    (Spot On Awards)
    ii. How can we give increases when revenues are down?
    iii. What efforts have been made to reduce overtime?
    1. Has there been any strategic planning in Fire Department and regarding Snow Plowing?

    Interesting…
    3) Would like to discuss turning the Mayors position into a full time position with attractive pay.

    Perhaps we should do away with the City Manager form of government?

    From Mike Larson:
    Union Contracts should have a lead negotiator who is not a member of the City Staff. It is difficult if not impossible to hold a hard line on something one day and be a manger the next day.

    Triple Spot On! But include admin pay negotiations to this, too.

    From Gary “Outta da Box” Peele: (compliment intended)
    Consider passing local ordinances mirroring state law and make these a “ticketable” offense. No criminal record and the revenue stays here. After all, the City is expending the manpower for enforcement so why not get the benefit?

    Such a measure is authorized by Home Rule

    2) Actively pursue grant opportunities.

    Spot on! Peele found a possible grant for the fire department that will be discussed.

    5) Begin to think outside the box- re my suggestion of beet juice.

    Internet Research Commando Alert!!! Beet juice to replace salt as an ice remover. Suggested cost savings. Suggested less damaging to road surfaces. Probably healthier for insects and birds, too.

    From Tom Teresinski: (exellent report, IMHO)
    BOMBSHELL:
    General Fund – Spending: $14,535.8 (1998 Actual) $28,167.0 (2009 Budgeted) = 93.8% Increase
    Comment: Given that the City has historically spent more than 2 times the rate of inflation over the last 11 yrs indicates that we have a spending problem. Since these costs are 85% personnel this will be a major component of the review required.

    Ummm, wow. Houston, we have a spending problem!

  7. I find it hard to believe the “pass” the council and mayor are getting on the union contracts issue. Lead negotiator Bologna!!! All the lead negotiator does is represent the views and wishes of the Council. It is the Council that agrees to these terms and conditions not the negotiator! He isn’t doing anything that hasn’t been approved or will be approved. We need to hold the people responsible who sign the document and pass the ordinances not those that are sent in and are doing nothing more than carrying out the wishes of the council.

    Ed Pevonka

  8. Basically in agreement with the need to be tougher in negotiations and council’s historic failure to be so.

    As an academic and activist I’m just wondering how one can learn of the dynamics in the closed sessions on union contracts, especially without violating fair labor concerns. Are council members weak? Are staff members presenting a slant? Is the fear of what will happen with binding arbitration and precedents of the same impacting local negotiations?

    Herb

  9. I believe that we should give Ed some creedence here. Ed has been involved with these types of unions and I have to feel that he knows how things can go vs. how things have gone.

    There is just too much being given. I am not going to blame the unions at all for this. I do believe those who sign off on these agreements to be at fault. Can you blame someone for getting all or more that they can? I do think that many of the unions know how good they have it but “our leaders” just keep giving them what they are asking for.

    It has to stop and there needs to be a reality check. Look at what bigger communities are paying their employees. We are outpaying everyone mentioned in Mac’s report. We do not have to spend, PERIOD!

    Cuts, Cuts, Cuts, Cuts…….. This has got to be the hardline stance taken by our council and the sooner the better.

  10. Wow, I get more and more impressed with this Financial Advisory Committee all the time. Mr. Teresinski’s bombshell gave me a headache, yet it’s a relief to have numbers to confirm the feeling that something is very, very wrong. Obviously we’ve been on the road to ruin for a long time and the economic downtown just hastened the inevitable.

    It is clear that the city has been like the kids in the candy store. We need some grownups in there who to say, “no.” Actually, that’s putting it charitably. The candy store’s been robbed.

    I’ve been reading about the council-manager form of municipal government in the IL Compiled Statutes as well as what might replace it. The referendum question is simple: “Shall the City of DeKalb retain the managerial form of municipal government?” Certainly it’s something to think about, since we are so much of the time wondering where the buck really stops, and the rest of the time suspecting it stops with someone who is not elected to represent us.

  11. Herb hit the nail on the head:

    “Are council members weak? Are staff members presenting a slant? Is the fear of what will happen with binding arbitration and precedents of the same impacting local negotiations?

    Herb”

  12. Hellyeah Ed gets creedence… a clearwater revival for sure.

    But I agree with Mike Larson’s position. The current system has the City Manager negotiating terms and making recommendations to the City Council. Current staff spending is the result. Salaries may not be 100% of the problem but since 85% of the GF goes there, well, its 85% of the problem then.

    Bringing in an outside negotiator gives the citizens the best scenario. It’s how its often done in the private sector.

    Ivan’s absolutely right that it is not the union’s fault. It is their fiduciary responsibility to ask for the most they can get. But in notice of the commonality of negotiated union perks in the Manager’s Pay Plan it is hard to disregard a conflict of interest issue. Oh, and those who receive compensation from the Manager’s Pay Plan also should ask for the most they can get. Ed’s right that the buck stops with the City Council. Obviously, they need more help in stopping those bucks than they receive currently.

  13. I’d double check but I think it is an administrative team that might change depending on the union that does the negotiations. At least that is the usual way. City manager would of course be on the team.

    The basic structure of the contracts though predates Biernacki and really hasn’t changed for several mayoral terms. That doesn’t justify anything now but is consistent with Yinn’s metaphor a while back of the city’b budget being akin to an aircraft carrier (or something like that)

    Herb

  14. Welcome to a home rule community! You now have less rights than you previously thought you had, we know what you need and want more than you do.

    So, sit back, relax and allow us, your elected officials to tax and spend and then figure out how to tax you even more.

    It is really difficult to feel that our city government is really concerned about us, the taxpayers when you see things like this happening. Is this just a little glitch within the IT department? Is the City Attorney currently rewriting the voters bill of rights?

  15. I think it’s hysterical that three hours after somebody points out that we have rights that those rights disappear. Clerically, anyway. Maybe IT is making a budget statement.

    In any event, I plan to attend the meeting tonight. I’m not sure what I can say in my three minutes of face time. I think all I can do is reiterate that I agree with Mac’s analysis and the need to cut the budget. While those cuts may look draconian, I think that everybody might be surprised with the delivery of services, in a pleasant way. I may restate a couple of my own suggestion that the good Mr. MacIntyre quoted as well. I don’t know how effective redundancy may be in this matter.

    Going off topic a tad here, but I’m not warm to the idea of vehicle stickers. If we can effectively attack our budget woes, then maybe we can either begin to free up some sources of revenue or come up with a fee increase that won’t have to be so significant.

    As of this morning, I did not see that tomorrow’s special meeting agenda had been posted. Can anyone shed any light as to what it is? Surely if they spit on us and pass the tax increases in the first readings tonight, they can’t have the second reading tomorrow night, can they? Would the counsel be so brazen tonight as to move for a waiver of the second reading tonight and make those increases effective that way?

    Also, I noticed the comments made about the grant-writer. I was wondering if the Daley lobbying group performed that function as well. Maybe we could get more from their services for what we already pay. I have mixed feelings about the lobbyist; we didn’t do as well with Denny as we could/should have. You’d think Foster would be amenable to providing DeKalb with attention, since the community leans to his party’s direction. I don’t often agree with Mr. Barnes, but if we had a full-time mayor, what functions of city management would we dump? Perhaps a full-time mayor could become the city’s lobbyist?

    Just a few thoughts.

  16. There is a faction in Aurora that wants to change TO the manager form of ctiy government. Perhaps this indicates that the structure matters less than the individuals in these positions? I don’t know.

  17. I don’t have a problem funding the police station in a conventional way. With the recent budget hearings and seeing how money is misspent, I would say that the station would be no problem if the city would manage their money the right way.

    Ed’s idea along with FAC member to cut back health insurance 15 to 25% being paid by the employee would bring about $900,000.00 back to the bank account. This alone would pay for the station and many other necessities over the upcoming years. Heck, they wouldn’t even need to raid the water fund every year like they are currently doing. They could even lower back down the water fees.

    The question: Will the DeKalb City Council do right by the taxpayers or will they continue this fiscally irresponsible slide into the dark bowels of debt?

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