Montgomery officials resume road funding talks : News : Oswego Ledger-Sentinel : Hometown Newspaper for Oswego and Montgomery, Illinois
|Montgomery officials resume road funding talks |
|Board told $1.8M to $2.3M needed annually to pay for maintenance program|
|by John Etheredge|
Montgomery Village Board members resumed their on again, off again discussion Monday evening concerning how the village will pay to maintain its streets.
Village President Matt Brolley concluded the discussion by asking village staff to provide the board with more information on the status of the village's outstanding bond debt along with an update on the village's sales tax revenues and previously approved sales tax rebate agreements.
Brolley noted that a prior village board was notified in 2011 of the village's need for significant additional revenue to maintain local streets. However, he said, that board chose not to act and, in effect, passed off the responsibility to the current board.
"I believe it is one of our core functions is to find out what to do about this," he continued. "No one wants to talk about increasing revenue and taxes or anything like that. But it is our job to find out how do we fund this in 15 years. The easiest thing would be not to do anything about it and let the next board deal with it-but then we will not be doing our job."
Brolley added, "As long as there is a majority of board members who want it, we will continue to have this discussion."
Earlier during the meeting, Peter Wallers, president of Engineering Enterprises, Inc., the village's engineering consultants, told board members the village will need an additional $1.8 million to $2.3 million annually to maintain the village's streets.
Wallers said his estimate is based on an in-person inspection of the village's streets and the use of a computer program.
He noted the number of streets requiring maintenance in the village has increased dramatically since 2000 due to the development of several new subdivisions on the village's far west side.
Steve Andersson, village attorney, presented board members with five potential options for increasing the village's revenues to pay for street maintenance and other capital expenses.
Of the five options, a majority of board members agreed that an increase in the village's current sales tax rate of 7.25 percent appears to be the most acceptable.
Andersson noted that state law would permit the village to increase the rate in .25 percent increments up to one percent.
However, in order to increase the rate, the village-as a non-home rule community under state law-would first have to secure the approval of village voters in a referendum.
When questioned by board members, Justin VanVooren, the village's finance director, said each one-quarter of a percent increase in the sales tax would generate approximately $425,000 annually in new revenue for the village.
Jeff Zoephel, village administrator, said if the board were to decide to place a sales tax increase referendum on the ballot he would recommend the village ask for a full one percent increase in the tax rate.
Zoephel noted the village's current total sales tax rate of 7.25 in the Kendall County portion of the village and seven percent in the Kane County portion is less than the 7.75 percent charged in neighboring Oswego.
He said he does not believe increasing the rate would put the village and its retailers at a competitive disadvantage.
Board member Stan Bond said the board has known for "several years" that the cost for maintaining village streets is going to increase dramatically in the coming years.
"We made choices to spend our money in other ways, knowing that we had this obligation," he said.
"In my mind re-directing revenue is still an option," Bond added.
Zoephel agreed, but said, "It would be hard to find $1.8 million in revenue-but that's certainly an option."
Board member Steve Jungermann said any discussion concerning raising taxes is "never popular" but added, "the board is faced with a significant challenge. We need to improve our capital funds budget, but I want to do it in such a way as to spread it out on as many people as possible."
Jungermann described himself as "open on all (funding) options" but would favor one that place as "little of the burden" as possible on village residents.
Board member Denny Lee said he believes the village needs a new source of revenue and increasing the sales tax is the best option.
Lee said he believes another option presented by Andersson-seeking voter approval of home rule status for the village-would be a "tough pill (for village residents) to swallow."
Referring to village residents, Lee said, "They would have to have an awful lot of trust in us as to the amount and then boards change and all of a sudden the price could go up.
"The only way we could get extra revenue, and not have Montgomery (alone) pay for it, is through the sales tax. People come into our community and shop at Wal-Mart and Menards and the rest of those places and those people are on our roads, so they are paying for the roads, basically."
Zoephel noted that both home rule status and to increase the village's sales tax would require a referendum.
He said village staff believes seeking passage of a sales tax referendum is the better option of those two because village officials could tell residents the funds would be used for street maintenance.
But if voters were to approve a home rule referendum, Zoephel said it would grant the village much broader taxing authority.
Brolley noted that a one percent increase in the village's sales tax would add $1 in taxes to a purchase of $100 in a village store.
He also said he does not believe the village could re-allocate $1.8 million annually from its current revenues to fund street maintenance.
"But at least if we can look at the big picture and see if we were do that, what it would mean to our other services," Brolley said.
Bond said he believes it is important that the board continues its discussion on the issue.
Bond noted that the quality of village streets and other infrastructure directly affects local property values.