Friday, March 25, 2016

Belvidere aldermen want more accountability on utility tax spending

  • Belvidere aldermen want more accountability on utility tax spending

    • By Susan Vela
      Staff writer

      Posted Mar. 25, 2016 at 1:48 PM
      Updated at 2:00 PM

      BELVIDERE — With the economy on the mend, Belvidere aldermen want the city to return to using utility taxes mainly for street and infrastructure improvements.
      The tax mainly has been used for paying salaries and other bills since 2010, but some aldermen say financial conditions have improved enough for the tax to once again be dedicated to its original purpose. Others say the tax is still needed to balance the budget. Aldermen are also asking for more accountability on where utility tax dollars are spent.
      Disagreement over utility taxes held up a recent vote on the city's annual $19.2 million spending plan.
      They voted 6-2 on Tuesday, with Aldermen Daniel Snow and Daniel Arevalo providing nay votes, to delay approval of the spending plan.
      Ald. Mark Sanderson wanted to remove the utility tax revenues from the general fund and place them in a separate fund only to be used for emergency, non-road improvements. But City Attorney Mike Drella said in order to do that the city's code would have to be amended before or after the budget was approved. So, the end request from the council was for better recording of utility tax usage. They want utility tax revenues and expenses to be itemized in the budget, and they tabled their budget decision to potentially incorporate the information.
      The new budget year begins May 1, but some aldermen want $2.2 million in revenues from the 5 percent utility tax on gas, electricity and telephone usage to appear as general fund line items when used for expenses. A total of $2.7 million in utility tax dollars has been budgeted.
      “It’s just been used willy-nilly,” said Sanderson, leading the charge for better accountability “so they can’t just use it for toilet paper.”
      The utility tax was established in 2000 to help pay for road repairs. There have been several amendments since then. After the Great Recession struck, there was an official decision in 2010 to place utility tax revenues in the general fund coffers.
      “At that point in time, we had no money to pay bills,” Mayor Mike Chamberlain said. “We needed money to pay salaries. We had done everything else we could possibly do. We’re still not out of the woods.”
      Ald. Clinton Morris disagreed. Constituents perceive the redirection of utility tax revenues as “you’re taking this tax money from us,” he said.
      Becky Tobin, the city’s budget and finance officer, confirmed that about $6.25 million in utility taxes went to police, fire and public works salaries between May 1, 2009, and April 30, 2015.
      She’s waiting to see what aldermen have to say at Monday's Committee of the Whole meeting to see what she’ll do regarding the council’s request to itemize every utility tax dollar used in the next spending plan.
    • “I’m not very happy about it right now,” she said of the request. “I think we should leave the utility tax in the general fund. The city needed the utility tax money to run day-to-day business operations. We would not be able to balance the budget at this point without it.”
      Since the utility tax was approved, it has generated more than $30 million for the city, and almost $21 million has been spent on infrastructure, Tobin said. But less than $100,000 has gone toward infrastructure projects since 2011, and motor fuel tax revenues have paid for some repaving, she said.

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