The Commercial-News, Danville, IL

Local News

November 2, 2009

Aldermen to meet again for budget talks

DANVILLE — Aldermen will have another tax levy/budget study session tonight to discuss where the city is going financially from here.

Mayor Scott Eisenhauer sent an e-mail to aldermen and also gave them requested information from the first meeting.

“I felt as though we made a lot of progress in digesting our goals, our challenges and began movement toward finding short-term and long-term solutions,” Eisenhauer said in the e-mail about the first study session.

He said the informal format with aldermen leading the discussion will be the same for the second study session.

“I would hope that from this next study session we will have some clear direction on new revenue source implementation or have defined which services we are committed to eliminate,” Eisenhauer said.

He asked aldermen to send him any recommendations or thoughts they have regarding revenue source increase or implementation, or recommendations for service elimination prior to the meeting so he can put together facts and statistics.

The city is facing at least a $1.5 million deficit, an increasing property tax levy due to pension costs and needs to build back a reserve.

Ward 6 Alderman Steve Nichols had asked at the last meeting what services are municipalities, the county and townships legally required to provide citizens?

Eisenhauer addressed only municipalities in saying that according to state statute, “a municipality is only required to maintain property which it owns. Therefore, it must maintain streets (those owned by the city rather than township, county or state), parks and any public property owned by the municipality. No other services are required by law…”

That includes public safety. There are several cities that do not have a municipally-owned police or fire division, he said.

Eisenhauer also presented aldermen with sales and utility tax numbers.

The city is now generating about $900,000 for every .25 percent in city sales tax it collects.

However, Eisenhauer only conservatively is projecting $750,000 of new revenue for every .25 percent increase.

If the city’s 7.75 percent sales tax was increased by another .50 percent, it would generate about another $1.5 million.

Because the city doesn’t have an electric utility tax, Eisenhauer gathered information from AmerenIP regarding customer kilowatt hour usage.

The maximum amount that can be charged per KWH is set by law. The rate is based on a series of stratas. Ten percent of the maximum rate would generate $205,081, while 75 percent of the maximum rate would generate $1.5 million.

Eisenhauer also used AmerenIP information about a natural gas utility tax and information from Aqua Illinois about a water utility tax.

A 1 percent natural gas utility tax would generate $222,916.

A 1 percent water utility tax would generate $125,000.

Also, aldermen have discussed raising the rental registration fee to offset program costs.

If the fee was raised from $10 to $100 (with the cap amount also increasing from $500 to $1,000), the total fees collected would increase from $44,780 to $368,900.

Eisenhauer added that other aldermen suggestions of closing the municipal pool would save $55,100, but that doesn’t take into account the money needed to mothball the pool or the cost of moving the AMBUCS Sprayground for Everyone, required by an agreement if the pool was to close.

If clerical staff is further eliminated, this will result in the use of an automated telephone system in many departments, forcing citizens to use a touch-tone format instead of talking to a live person, Eisenhauer added.

COMING UP

A second Danville City Council tax levy/budget study session will be at 6 tonight in the community room (adjacent to the city council chambers) at city hall, 17 W. North St.

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