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Oswego Board rejects sales, gas tax proposals : News : Oswego Ledger-Sentinel : Hometown Newspaper for Oswego and Montgomery, Illinois
Oswego Board rejects sales, gas tax proposals
Village to dip into fund reserves

by John Etheredge

5/1/2014

Oswego Village Board members rejected proposals to increase the village's Home Rule sales tax and to impose a four cent per gallon fuel tax in separate votes during a contentious meeting Tuesday evening.

Village staff had proposed the tax increases as part of the village's proposed 2014-15 fiscal year budget to provide funding for an expanded street maintenance program this year and for future years.

Village President Brian LeClercq cast the tie-breaking "no" vote on both motions after board members deadlocked in 3-3 tie votes.

Voting in favor of the tax increases were board members Judy Sollinger, Pam Parr and Gail Johnson. Board members Terry Michels, Tony Giles and Scott Volpe cast the negative votes on the motions.

To pay for this year's expanded street maintenance program, the board instructed village staff to use existing reserve revenues.

However, Mark Horton, the village's finance director, and Steve Jones, village administrator, cautioned board members that the village would require still additional revenue to fund the village's street program for the 2015-16 fiscal year and beyond.

To fund this year's street maintenance program, Horton said the village will use reserve revenues from the village's Motor Fuel Tax (MFT) fund.

Prior to balloting on the motions, Michels said he believes before the board approves any tax increases village residents must be assured the board had scoured the budget for potential cuts. He charged that had not been done.

Johnson said she believes the board has always adopted very lean budgets.

Sollinger said the village was facing an $800,000 deficit to pay for this year's street maintenance program and asked how the village will fund next year's program.

For decades the village has used state-reimbursed MFT revenues to pay for its annual street maintenance program. However, over the winter, the board unanimously agreed to expand this year's program.

According to the village's long-range Capitol Improvement Program (CIP), MFT revenue to the village "is on the decline and no longer is sufficient to support the estimated total costs of the annual program expenditures...on average, approximately $1.3 million in additional funding is needed over the next five years to complete the annual road program." (The CIP can be viewed on the village's website at oswegoil.org.)

To provide the additional funding, village staff had recommended the board increase the Home Rule Sales Tax while also implementing the fuel tax.

Jones has attributed the need for an expanded street maintenance program to the village's growth over the past two decades.

"The spike is due to the fact that for years and years we've been doing relatively small road programs because most of our roads were new," he said, adding, "It's been the older areas of town where we've had the new (roads). As those new roads become 14, 15 and 18 years old they obviously will need attention."

In a related matter, Tuesday evening, board members voted unanimously to approve the 2014-15 fiscal year budget. The village's new fiscal year will begin today, May 1.

Prior to voting on the budget, board members agreed they did not have enough time to review and discuss the budget as it was prepared by village staff over the past several months.

Parr noted that when she served on the Kendall County Board the board began discussion on the annual budget every June and did not adopt it until December.





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