The City of Belvidere is considering a roll back in the utility tax for Fiscal Year 2010, beginning May 1, 2009. Take a look at the article in the Rockford Register Star: www.rrstar.com/boone/x1589174724 or read it below:
Residents may get a little tax relief starting this spring in the form of a 2 percent reduction to the city’s utility tax.
Plans to cut back on the tax charged to gas and electricity use were laid out Saturday during part of an all-day retreat for the City Council. The majority of the retreat was spent reviewing the city’s proposed $12.7 million budget for the coming year.
The reduction was proposed to give businesses and households relief during a tough economic climate, Mayor Fred Brereton said.
The city’s fiscal 2010 budget, which runs May 1 through April 30, 2010, will be formally introduced today, when aldermen will have their first chance to make any amendments. Officials plan to approve the budget by March 16.
If approved, the utility tax on gas and electricity will be dropped by 2 percent during the budget year. At that time, the city will assess the possibility of making the cut permanent.
Tax often debated Debate surrounded the use of the 5 percent utility tax throughout 2008. First, Brereton proposed using a surplus in the tax to pay for additions and renovations to the Public Safety Building. Officials sought a public-safety sales tax increase instead, which voters defeated.
Ald. Andy Racz tried twice last year — in April and again in October — to get fellow aldermen to agree to cut the tax by 2 percent, but his proposal failed each time. Only Aldermen Mark Sanderson and Ray Pendzinski supported the measure at the time. Money from the tax pays for road construction projects and maintenance. “They say nothing happens until the time is right,” Racz said. “It’s an idea whose time has come, and it is the right thing in terms of our budget.”
Reducing the tax will take about $867,000 out of the city coffers, according to budget estimates provided during the retreat. About $319,400 will be left in the city’s utility tax fund balance at the end of fiscal 2010, according to projections.
The city plans to suspend its street reconstruction program for the coming year, which featured a roughly $1.5 million makeover of Columbia Avenue, Brereton said. The project was part of the city’s submission for federal economic stimulus money.
Revenue down 4 percent
The coming year’s budget is slimmer thanks to a roughly 4 percent drop in revenues. The city plans to spend about $12.7 million in 2010, compared with the $13.3 million it budgeted for fiscal 2009.
Brereton called it a “maintenance budget,” one that’s intended to maintain the services already in place and go through the year without staff reductions. The budget presented calls for a hiring freeze and a halt on capital expenditures, but it doesn’t require layoffs.
Residents also are expected to pay a lower property tax rate than last year. The lower rate equates to lower taxes paid if a home’s assessed value does not change. However, housing values grew by about 4 percent across the board in Boone County this year.
The city’s property tax rate has dropped from 1.1184 percent in 1999 to 0.9291 percent in 2007, largely because of the city’s increase in equalized assessed value.
The city’s total equalized assessed value grew from $201 million in 1998 to $416 million in 2007 thanks to residential, industrial and commercial growth.
The city’s retreat Saturday also featured an update and review on the federal economic stimulus package and a presentation on the National Incident Management System, which is a guide for responding to a crisis.
Staff writer Kevin Haas can be reached at 815-544-3452 or khaas@rrstar.com.
Jim Wise gave a statement on the utility tax issue on http://belvideresovereignty.wordpress.com/ for your convenience I am copying it below:
‘Residents may get a little tax relief this spring…’ a story in the Rockford Register Star announced. Following the Belvidere City Council retreat of Saturday, January 24 the papers reported that Mayor Brereton was offering tax relief to the citizens and businesses of Belvidere in the form of a reduction of the Utility Tax rate for the 2010 fiscal year. “The reduction was proposed to give businesses and households’ relief during a tough economic climate, Mayor Fred Brereton said.”
Sounds good, but this is nothing more than a cheap election year ploy. For two years Mayor Brereton had attempted to convince the citizens of Belvidere to approve an increase in the public safety sales tax to pay for an expansion of the PSB. If that effort had succeeded, you would be paying $100-$125 more a year in sales taxes than you are now. This “tough economic climate” began more than a year ago, yet now mayor Brereton is realizing the impact that this is having on the citizens of Belvidere.
Now, in an attempt to prove that he is protecting the pocketbooks of the citizens. Mayor Brereton is proposing a reduction in the Utility tax rate of two percentage points (from the current 5% rate to a 3% rate) for the 2010 budget. This would be the equivalent of paying 40% less in utility taxes this coming year than you paid last year. If you pay $200 in utility taxes between May 1, 2009 and April 31, 2010 then this would equal a savings of $80. Wow!!! Now that’s some real relief!
Where was this consideration during the recession of 2002 brought on by the events of 9-11? Then our economy suffered through an 8 month recession. Yet, I don’t remember Mayor Brereton offering to reduce the utility tax rate then. Or, what about when times were good? When revenues were up? When sales taxes, income taxes and property taxes were rising could the city have forgone a few hundred thousand dollars in utility tax revenue then? Mayor Brereton did not think of reducing the rate then either. But now when an election year nears, Mayor Brereton is ready to play his hand. And, he’ll throw in the ultimate election year teaser, saying that “…the city will assess the possibility of making the cut permanent.”
Apparently, Mayor Brereton is attempting to create the appearance that he is looking out for the best interests of the citizens of Belvidere. It is unfortunate that Mayor Brereton only thinks of these things during an election year. I think that he is grasping at straws desperately trying to find any means possible to secure a fourth term as our mayor. He’ll even go so far as to play the ‘I will lower your taxes’ charade while all the time hoping that you will have forgotten that he spent the last two years trying to raise them.
Jim Wise
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