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Montgomery Board OK with referendum question : News : Oswego Ledger-Sentinel : Hometown Newspaper for Oswego and Montgomery, Illinois
Montgomery Board OK with referendum question
Vote pending to place sales tax hike request on Nov. 4 ballot

by John Etheredge

5/15/2014

Montgomery Village Board members moved a step closer this week to placing a referendum on the Nov. 4 ballot asking village voters to approve a one percent sales tax to fund the village's annual street maintenance program.

Responding to a prior request from the board, Justin VanVooren, the village's finance director, noted that village staff and attorneys have changed the wording on the referendum question to include the words "maintain" and "roads."

As now drafted the referendum question will read: "Shall the Village of Montgomery, in order to maintain and/or improve the village's roads and public infrastructure, and to avoid the imposition of other taxes and fees impose a one percent sales tax for expenditures on public infrastructure...?"

Board member Doug Marecek said he believes including the word "roads" in the question "clarifies the village's intent" in seeking passage of the referendum.

Village President Matt Brolley said he agreed.

"I like the change in wording; I think it is important," he said.

The village's engineering consultants have advised the board that the village will require an additional $1.8 million to $2.3 million annually to maintain local streets in the years ahead.

The engineers' estimate is based on an in-person inspection of the village's streets and the use of a computer analysis of the streets.

Additionally, 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.

The village's current sales tax rate is seven percent in the Kane County portion of the village and 7.25 percent in the Kendall County portion. The two rates are lower than the rates currently charged in Oswego (7.75 percent), Aurora (8.25 percent) and Yorkville (8.25 percent).

VanVooren has said each one-quarter of a percent increase in the sales tax would generate approximately $425,000 in new revenue for the village each year. As a result, passage of a one percent tax would generate an estimated $1.7 million in additional revenues annually, based on VanVooren's calculations.

The board is expected to vote later this spring to adopt a resolution placing the referendum on the ballot.



Support voiced for
property tax rebates


In a related matter Monday evening board members reviewed and voiced support for adopting a second resolution that would grant residential property owners in the village a partial rebate on the village's portion of their property tax bills in the event the November referendum is approved.

Under consideration by the board are annual property tax rebates ranging anywhere from five to 20 percent.

Brolley said he believes that everyone agrees that village residents are overtaxed. However, he noted the proposed sales tax would serve to generate revenues for a specific purpose: street maintenance. If voters approve the tax, Brolley said the village would then offer a property tax rebate.

He explained, "We what we are trying to do here is make an agreement with our residents that, yes, this board is cognizant that we are asking you to vote for a sales tax increase at the store, but at the same time we don't want you to bear the brunt of that full burden so we want to rebate a portion of your property taxes that we now charge you every year."

Board member Steve Jungermann noted the sales tax would not apply to purchases of food, vehicles and other, selected items.

"We need to make that clear (to voters)," he suggested.

Jungermann noted the one percent tax increase would add $1 to every purchase of $100 and it would be paid not only by village residents, but other area residents who shop in village stores as well.

"There are a lot of people who live outside Montgomery, who shop in Montgomery and that is going to continue to grow as our business development increases," he said.

Jungermann added the rebates would apply to just the village portion of property tax bills, which typically account for a very small percentage of the total amount owed on each bill.

When questioned by board members VanVooren confirmed that the village portion of a typical property tax bill received by village residents each spring is about $300. The individual rebates would be based on that amount-not on the total amount owed on each bill, which can total several thousand dollars.

For residents to receive a further reduction on their property tax bills, Jungermann suggested, they will "have to talk to the school district about that."




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