By Ted Schnell • BocaJump | Nov, 28, 2011
Mayor David Kaptain said Wednesday that the City Council would make the final determination on how to diversify Elgin’s revenue streams to avert a perfect storm of revenue losses — the city is projecting declines in three of its four revenues streams — that are threatening the city with a structural deficit of as much as $13 million in 2012.
The “balanced approach” 2012 budget that City Manager Sean Stegall first presented included a property tax rate that would “float” to ensure that revenue source would not fluctuate from year to year. It also included an $18 monthly trash-hauling fee to generate $6.4 million a year, and a .5 percent increase in the home-rule sales tax to 1.25 percent, which would generate an estimated $3.2 million a year and would be levied specifically to fund future street maintenance projects.
But the trash fee, Kaptain said, may become a “pass-through” — meaning the costs of that program would be subtracted from property tax bills and placed instead on residents’ water bills.
Some other possible changes to watch for in a new budget proposal include:
- Home-rule sales tax: Doubling it to 1.5 percent would generate an estimated $4.8 million annually.
- Vehicle stickers: At least several residents who spoke Nov. 19 argued this fee, which the city abandoned after the Grand Victoria Casino opened in late 1994, should be reinstated. A $35 sticker fee would generate $2 million; a $50 fee would generate $3 million. The program carries administrative costs (stickers and billing) totaling $625,000.
- Food and beverage tax: The 2 percent tax proposed in budget Alternative A would generate $1.7 million.
- Utilities tax: A tax on electricity and/or a tax on natural gas use. The city has not projected publicly how much revenue the city would see from such a tax.
- Gasoline tax: Projections uncertain.
- Real estate transfer tax: City officials have not spent much time discussing this tax publicly, saying it was contentious and abandoned as a result.
Kaptain said he would like to see targeted revenue streams — for example, if a gasoline tax is levied, he believes it should be used to fund street maintenance and related work, which has been paid in the past with now dwindling riverboat funds.
He said he also has proposed a utility tax for storm water to pay for continued work to separate the combined storm sewers that now are at odds with the nation’s Clean Water Act. Kaptain said some of these combined storm sewers have been targeted for replacement for more than 40 years, and it is time to think long term and begin addressing these needs.
Budget meetings resume
Monday, Nov. 28: The council is scheduled to meet from 6 to 9 p.m. in the City Council Chambers for continued discussion of the general fund and riverboat fund.
Wednesday, Nov. 30: A 6 to 9 p.m. meeting is scheduled in the City Council Chambers to consider the water, sewer and other funds.
Wednesday, Dec. 7: This 6 to 9 p.m. meeting will be the city’s Truth in Taxation public hearing in the City Council Chambers.
Wednesday, Dec. 21: This 6 to 9 p.m. meeting will be the city’s public hearing before adoption of the budget ordinance, and the adoption of the ordinance for the levy and assessment of taxes.