Cities defend 'revenue increases' as necessary; those affected feel officials are acting without public's consent

CHAMPAIGN — The day the city released a proposed budget last week was the first day that drivers began paying 4 cents more per gallon at the gas pump toward road repairs.

The timing was coincidental but appropriate.

As revenues have shrunk while costs continue to expand, some elected officials have defended the gas tax and other charges like it as essential to maintain a balanced financial plan without cutting too deeply into services.

In both Champaign and Urbana, new fees and tax increases have been years in the making. Administrators refer to them as "revenue increases," and they are worth millions of dollars to city budgets. On the other hand, each has encountered some degree of public resistance along the way.

"Instead of cutting back like homeowners have to do and families have to do, they just go ahead and keep raising fees," said Brian Sullivan, a Champaign property owner and landlord.

But officials have cut back. City budgets have shrunk by millions of dollars: In Champaign, officials have rebuilt fewer roads, cut overtime for firefighters and eliminated dozens of city jobs. Champaign officials argue that the balances they have made will put the city in a better position when the economy begins to rebound.

"The new fee and fee increases adopted in prior years somewhat mitigated the effect of service reductions from budget cuts," said Champaign Finance Director Richard Schnuer. "However, the revenue increases were small compared to the budget cuts. Very small."

As a landlord, Sullivan was particularly interested in a new multifamily recycling fee in 2010, which created a program that provides at-home service to residents living in complexes with four or more units.

The $2.60-per-unit monthly fee will generate $545,000 this year. It has not had a visible effect on Sullivan's rents, he said, but it's the compound effect that hurts — especially for landlords who own a lot of property.

"The problem is, we couldn't raise (rents) anymore because we have so many other fees," Sullivan said. "And when we continue to raise them, people move out."

Capital projects have been a concern, too. The city of Champaign has borrowed $2 million from the account that pays for road and sewer projects and moved it to the general fund, which pays for the day-to-day operating expenses of the city.

That means some road projects and maintenance were sacrificed to maintain basic city services that already existed. The problem there, Schnuer said, is that roads that go unfixed break down to a point where asphalt patching will not solve the problem, and a much more expensive reconstruction becomes necessary.

"Unfortunately, it's a pretty vicious downward cycle," Schnuer said.

That's where the 4-cent per gallon gas tax comes in. It will create $1.5 million annually in new money, and one of the first projects on the list is an upgraded version of Windsor Road where it passes over Interstate 57, complete with bicycle lanes and sidewalks.

The city of Urbana preceded Champaign in its approval of a gas tax in 2010. It was initially implemented at 2 cents per gallon, with graduated increases until 2013. Urbana's gas tax is scheduled to rise to 2.8 cents per gallon this July, but Mayor Laurel Prussing said she will propose a budget Monday with a 4-cent per gallon gas tax, effective this July.

The Urbana City Council on Monday is also scheduled for a final vote on the storm-water fee.

Through all of Urbana's revenue increases during the past few years, Prussing said, she has not heard too much opposition.

"If people understand what the money is going for and it's something that they want, they'll accept it," Prussing said.

In 2011, the city of Urbana approved a 1 percent tax on package liquor after the Champaign City Council denied a similar 4 percent liquor tax.

That follows from Prussing's philosophy to "keep it below the pain threshold," she said. And it has been balanced by Urbana's measures to keep costs down, she added. City officials have kept staff raises to a minimum, only paying out raises that have been dictated by legally binding arbitration with city unions.

Back in Champaign, Salem Baptist Church is planning for a new storm-water drainage fee it knows it will have to pay next year. The church itself is pretty big, the parking lot is even bigger and the Rev. Claude Shelby knows that he'll be charged for every square foot of shingle and pavement.

"This is just another thing that will add on to our expenditures when we do so much for the community," Shelby said.

He is not sure yet how much he will have to pay when the first bill comes in 2013, but it is likely to be in the hundreds of dollars annually. The city expects to collect $3.2 million each year, all of which will go toward chipping away at an $80 million list of unfunded storm-water drainage projects.

The first in line to benefit from the fee are residents along West Washington Street who say they have been plagued with flooded yards and basements for years.

Without the city council-approved storm-water fee, "we could not have done that without significantly cutting basic services," Schnuer said.

But Sullivan said he is frustrated. He has sent letters to city officials and lobbied against the new charges. Some of the charges are very specific, he said, and target small groups that do not have enough clout to fight them.

"It doesn't seem like what we say or do is going to make a difference," Sullivan said. "They just go ahead and do it."

Recently instituted taxes/fees and revenue in Champaign-Urbana

 

Year/CityTypeAnnual revenue   Champaign  2013Storm-water fee $3.2 million20124-cent gas tax $1.5 million2012Property tax rate increase $400,000*2010Multifamily recycling fee $545,0002009Vehicle impoundment fee $214,000   Urbana     2012Property tax rate increase $145,000*2011Hotel-motel tax increase $130,0002011Package liquor tax $92,0002010Gas tax $418,000 this year

 

On the horizon

In Champaign, the city council has given preliminary support to a fee on plastic bags given to customers at checkout. Final approval is pending, but officials estimate the fee could create $200,000 annually in new revenue.

In Urbana, the city council has supported a storm-water fee that could create $1.7 million annually in new revenue. The fee could be finalized soon, and billing would start in 2013. Mayor Laurel Prussing says she'll propose a budget on Monday that includes a 4-cent per gallon gas tax, effective in July. That figure is above the scheduled 2.8-cent rate for that tax.

*Revenue created had the tax rate otherwise remained flat. The city council approved a flat property tax levy, but the rate rose because property values dropped.

Comments

News-Gazette.com embraces discussion of both community and world issues. We welcome you to contribute your ideas, opinions and comments, but we ask that you avoid personal attacks, vulgarity and hate speech. We reserve the right to remove any comment at our discretion, and we will block repeat offenders' accounts. To post comments, you must first be a registered user, and your username will appear with any comment you post. Happy posting.

Login or register to post comments

buzorro wrote on May 07, 2012 at 8:05 am

Government employee unions are killing us!

Orbiter wrote on May 07, 2012 at 9:05 am

No, no, no.  The City of Champaign has NO business raising consumer taxes while at the same time giving away $3 million in tax cuts to hotel developers (for the Neil/Church property).  This reeks of the welfare-for-the-rich that has plagued our country for the past 20 years.  If a hotel is going to be profitable, then it should be built without taxing the poor (which sales taxes do so very well).  Honestly, people, wake up!  And if a hotel isn't going to be profitable, then let the city levy an eye-sore tax on the property owner for this valuable lot that is blighting our downtown.  Maybe the owner will do something sensible then, such as build some non-luxury housing (not "project" style, but not the $2,000/month apartments we see being built elsewhere in downtown!).  Either way, let the so-called capitalists shoulder some of the risk and not push it off to the city!

Also, our local banks should seize this wonderful opportunity to lend money for worthwhile local construction--isn't this why the CEO of Busey is paid $600,000/yr?  To make business decisions for the good of the community?

Yocal wrote on May 07, 2012 at 11:05 am

Thank you, N-G for writing this article. I was starting to wonder if I was the only one who felt like the city is just going to do what it wants without listening to local residents/businesses/churches. I completely agree with the previous statement about the 3 million dollar break for the new hotel, while raising anything the city can think of on the rest of us. It's just not right, no to corporate welfare.

Sid Saltfork wrote on May 07, 2012 at 12:05 pm

Where in the world did you come up with this fixation about "government employee unions"? The taxes, and what they are being spent on are listed.  Keep chasing your tail.  Public employees are being paid according to agreements.  Numbers have been reduced.  They pay the same taxes that you pay.  According to you; they are to have no raises ever; and best work until they are ready to die.  How about you sweeping the streets, picking up litter in the parks, putting out the fires, and chasing criminanls?  Why don't you hire foriegn workers to do the work?  You could get them cheap.  They might even call you, "Master".

illini_trucker wrote on May 07, 2012 at 1:05 pm

Thank the Lord I sold the house and moved up northeast about 60 miles! Enjoy "your" taxes that "your" PUBLIC SERVANTS are imposing on you! 'nuff said..

chumberley wrote on May 07, 2012 at 2:05 pm

I don't mind paying the fee to help with road repairs. But why is adding sidewalks and bicycle lanes to west Windsor first on the list??  Why not fix the roads that are in desperate need of repair first?  How about resurfacing north Mattis or fixing Duncan?  These roads are so bumpy from constant patching that you can't even drive the speed limit down them!

xb wrote on May 07, 2012 at 3:05 pm

It's much more likely someone is going to get killed or seriously injured due to the no sidewalk no shoulder situation.  There is no room for a car to swerve to avoid a pedestrian without potentially going head on against another car.  The bumpy roads suck but they probably won't cause an accident.

MissM wrote on May 07, 2012 at 3:05 pm

I agree, these roads you mention desperately need fixed. They are in awful shape. On the other hand, the overpass on Windsor has been a potential accident for many years now. I worry about pedestrians and bicyclists on that bridge each time I drive over it. Hopefully both the resurfacing and the bridge work can be accomplished with this money, as I think both are equally important.

dw wrote on May 07, 2012 at 4:05 pm

It would be nice to see efforts by both City Councils to combine a carot approach while wacking the populace with the taxation 2x4:  encourage a reduction in consumption that would allow for avoidance of the fees:

For instance if Salem Baptist Church invested in rain barrels/rain gardens and pourous asphalt for their parking lot it would seem to be logical that because they have reduced their load on the system they should be able to avoid most of the storm-water drainage fee.  Perhaps create a low/no-interest loan program that they would pay their stormwater drainage fee but it would go to payoff the loan -- many forward-thinking long term establishments would take advantage of this and it would lower the load.

For many, the 4-cent-per gallon gas tax is avoidable with some creativity:  bicycle, take the bus or invest in a plug-in or other highly efficient (or alternative non-taxed fuel) vehicle.  But in reality, on a 20-gallon fill-up that's an extra 80 cents: less-than the cost of half-a-gallon of gas!  However if we want the pothole problem fixed, we need our City Councils and populace to study up on Understanding Road Wear and its Causes (skip the ESAL stuff and go right to slides 15 and 16) 

At which point we'll all be on the same page and understand one of several reasons why the MTD attempted to lead us down the path of light electric rail to replace high frequency bus routes (think you got bad potholes in your neck of the woods?  Come to campus and travel South along Wright Street from Booker T. Washington to the intersection with John street:  pothole avoidance is like playing that old video game Frogger) -- you either pay the up front to get/keep good roads, or you pay it later repairing your vehicles' suspension: even some of the patches are bone jarring as they're not smooth.

To save on both cost of fuel/efficiency (a standard city bus gets 4-6 MPG, a Hybrid about 9 MPG which is a vast improvement though it doesn't look like it 'til you do the mat) and road wear and tear (and the coffers that are being drained to cover them), we'd be much better shape now if we followed the MTD route  to light electric rail.  Like the pourous asphalt and rain gardens/rain barrels, this was forward thinking that required leadership and a populace with the ability to invest and plan for the future.  This was evidently ahead of its time.  Today compared to when the light electric rail was proposed in 2003, we see the increased fuel costs have led to increased mass transit ridership, which in turn has led the MTD to respond appropriately with increased route frequency and the bigger tri-axle double-length buses (if you read the PDF, you know what that does to ESAL values), and then residents clamour for expansion of service to places like the new YMCA located far from the core of town.

At the same time high gas prices are increasing Mass Transit ridership/mileage,  private-vehicle owners are shifting to forms of transit that use less gas in order to save money.  By and large private vehicle owners are the sheep that are sheared to fill the road repair taxes as municipal agencies (which include school and mass transit buses) do not pay motor fuel taxes. 

If we anticipate that gasoline prices will continue to rise in the future, we can bet that both the MTD transit increases and private transit ownership moving to high (or zero) MPG vehicles will contine and as such the new 4-cent-per-gallon tax is going to dwindle quite rapidly.  Investment in the future (prevention) is worth several tons of cold patch / road repavement (as well as the labor to do it) and your shocks/struts/tie-rods/wheels... and embodies conservatism at its best.

As to why gas money is being spent on bicycling and pedestrian infrastructure on Winsor over I-57?  It will make that overpass much safer for ALL -- pedestrians/runners, bicyclists AND drivers -- that section of road is too narrow to be shared, so imagine what would happen if a motorist lost control trying to swerve to avoid a bicyclist exercising their right to use the full lane and as a result flew off onto I-57 below (or the bicyclist flew off onto a vehicle on I-57).  Far cheaper to invest in the future and fix it so that doesn't happen.

We can continue to raise taxes so we can slap bandaids over the problems, or we can fix the things that are causing the problems and apply the taxes to solving other problems (because they'll never really go away ;-)

Dann001 wrote on May 08, 2012 at 1:05 am

TMI! In overdrive! 

rsp wrote on May 09, 2012 at 2:05 pm

For instance if Salem Baptist Church invested in rain barrels/rain gardens and pourous asphalt for their parking lot

You're talking about churches that operate on a shoestring as it is. Even with a loan they would be hard-pressed to pay it. A better option would be to find grants for them to replace their parking lots with pourous, maybe have a partnership with the U/I or Parkland to get rain gardens installed at low cost. If they can give a break to a hotel maybe the fees from the churches can initally go to reducing the burden.

handyman65 wrote on May 11, 2012 at 11:05 pm

If a church,like a business,can't be self sufficent to endure these hardships,then it like a business should fold!Churches already are tax exempt and you think they should get more free money on the backs of the working stiff.Hotels,unlike churches bring in money and give back to the community by creating jobs,property taxes,and draw in revenue from outside sources.

alabaster jones 71 wrote on May 13, 2012 at 9:05 am
Profile Picture

waaaahh, I had to pay a few cents extra in taxes this year so a church didn't have to shut down due to flooding damage.  life is so hard.  I needed those 2 cents way more than that church did.

handyman65 wrote on May 13, 2012 at 8:05 pm

If it's not that big of deal as you proclaim,then it shouldn't be hard for them to pay their share!I don't use this churches services so why should I pay for them?Here's something that they should be aware of being they preach it.Give to man whats his,and give to God what's his.If the church is of little faith to believe God will take care of it for them(if their righteous) then they are not believers in Christ.This church,like it's members, is looking for a handout from those of us that contribute to society.

sameeker wrote on May 10, 2012 at 9:05 pm

"revenues have shrunk while costs continue to expand". That sounds like what the working people are going through. The big difference is that we can't mandate a pay raise when our costs increase. Why do they keep increasing taxes andf fees for road repairs; yet, the roads never get fixed?

kdawg1878 wrote on May 11, 2012 at 3:05 am

I am a home owner in Urbana and see out Mayor and council as being not in touch with the community that they are supposed to be serving.  Prussing saig " she has not heard too much opposition".  Would that have anthing to do with her not reaching out to the citizens?  I know some will say, if people have complaints they need to address them at the city council meetings. I can understand that argument, but there are people who actually have work hours other then your normal 8am-4pm who can't make the meetings.

These taxes and fees are going to continue to grow unless we citizens, home owning, hard working citizens of Urbana say-enough is enough!!  I understand the reason for having taxes, I am an educated individual who has common sense.  It is just funny that everytime our sister city, Champaign, makes a suggestion that they are going to raise taxes or charge a fee, Urbana has to go right along with it.  So if this is the case, which it is, then why are these taxes and fees so needed in Urbana-because we wern't going to do them until we have to copy cat off of Champaign.  We are two different cities and we need to be treated as such and only raise taxes or charge fees for items that are really needed after the Mayor cuts out all of the wastefull spending and works of art.

About this new storm-water fee, this is a fee you are forcing on hard working home owners in the area.  In times like these it is tough for people to maintain their own bills with the rising cost of food, gas (oh yeah your about to raise the tax on that one too), clothes for children, education costs, and you want to shove other fees down our throat?  The fee might be a drop in the bucket to you Ms. Prussing, but to the rest of us it is our money, much needed money.  It might not seem like a whole lot now, but governments, to include yourself, have come to learn that people will take tings small incriments at a time but will refuse to take so much as to feel like they are really getting screwed.  $59.00 this month, and extra 4 cents per gallon next, and so on until people are paying as much for taxes and fees a month as their house payment.  

Bottom line, control your budget!!! I work for the city, I didn't get a raise last year.  I am not complaining at all about not getting a raise and in order to cope, I adjusted where my money was spent.  Do I have to give up some, yep, but I didn't errect a huge sculpture in my front yard like you did in front of the city building a couple of weeks ago.  Ms. Prussing, if you need assistance on how to create a balanced budget give me a call, I will show you how us middle class hard working folks do it, even if it means living pay check to pay check and providing for everything your family (for you being the citizens) need and some of what they want, instead of the other way around!!!!

handyman65 wrote on May 11, 2012 at 11:05 pm

I agree that the windsor road overpass  needs upgraded to accomadate pedestrians and bicycle traffic but why does those that drive a vehicle have to have the burden of paying for all of it?Shouldn't in all fairness,the cyclist pay their share for the upgrades since it will benefit them the most? Seems to me the cyclist of this city are getting a free ride with all the bike lanes being put in from which I get no benefit of but am forced to pay for evertime I fill up.

alabaster jones 71 wrote on May 13, 2012 at 9:05 am
Profile Picture

And how would we do that?  Do we mandate every cyclist in town to register?  I doubt many of them would register, unless we start pulling over every cyclist and checking for their registration.  Guess what, this would all cost...gasp!...tax dollars to implement. 

How confusing and impractical would it be if we applied that kind of logic to every public service that is paid for with tax dollars?  Should we foot all the taxes necessary for funding the fire department only on those who have had a house fire and required fire department assistance within the past fiscal year?

I drive and I don't own a bicycle.  If a few of my tax dollars, and I do mean a few, means a cyclist doesn't get run over and killed due to lack of a bike lane or sidewalk, I am glad to do so.  And if you have an altruistic bone in your body, you should be too.

handyman65 wrote on May 13, 2012 at 8:05 pm

Well yes if they want to operate a bicycle, or any form of it,should be registered and plated if they want to use our roads.If they don't register then they would be fined and that would create,wait for it,revenue! We already have a police force that is equiped with bicycles and more then enough means to enforce this.So stop with the scare tactics of making it sound like a burden.Their is nothing confusing or impractical about imposing a user fee on those that use the roads.In fact it's common sense which you seem to be lacking.You seem out of touch with reality because comparing this to fire protection is really imbelcelic thinking.We already pay a tax for fire protection.Lol! Now I'm not altruistis for wanting someone to pay their share of the burden.You really are a tool of the liberal thinking ideology.If it won't cost so much,a few tax dollars as you say,then why can't the people who receive the most benefit from it pay for it? Why does the tax payers,whom most are already one paycheck from living on the street,being forced to pay for something they get no benefit from? Your perseption of me is all wrong.I do care and deeply about people. But the ones I care about are the ones being shouldered with the cost of another tax increase to pay for a frivolous project in a time of shrinking income and ever increasing cost of living.All you seem to care about is for the few whom will get the benefit of something yet not pay for enjoyment of it.

alabaster jones 71 wrote on May 13, 2012 at 9:05 pm
Profile Picture

Obviously the fire example was extreme, that was the point.  And I am not a tool of any ideology, and I do not believe in the left-right fallacy either.

I'll just say this again, if you really spend this much time worrying over paying a little extra in taxes to help a bike lane get installed on a dangerous overpass or to prevent a church from shutting down due to flood damage, then I think you are greedy and selfish.  Not every cent you spend has to directly benefit you.  You claim you care about other people, just not enough to spare them a few bucks for their church or to help prevent them from getting run over.  You seem like the kind of person that would vote against a tax increase for education that would raise your taxes by a couple dollars, and then complain about the poor state of the school system in town.

If I never use Mattis Avenue, should I be exempt from paying any taxes used to repair Mattis Avenue?  Maybe they can install tracking devices in all our vehicles and only tax us for the roads we drive on.  Sounds like small government to me!

I hate waste of taxpayer dollars too.  The church parking lot and bike lane aren't wasteful.  One could save lives and one will mean a whole lot to a lot of people who won't have to see their church get shut down.  It's reasonable public service.  Federal and state tax dollars are a lot more likely to be frivilously spent than local tax dollars anyway, and obviously on a much larger scale, so if you are so pissy about your tax money being wasted then worry more about that.

Didn't you state in another post that you support the breaks this downtown hotel is getting?  So you don't think that is wasteful, but these chump change projects are?  Maybe it's because you are a handyman, after all, maybe you are hoping to get some work helping to build that hotel.  And then if you don't, you'll suddenly be changing your mind and bashing the hotel on these comment pages.

handyman65 wrote on May 13, 2012 at 11:05 pm

Lol,greedy and selfish.And you accuss me of that because I,like the rest of the already overburdened tax payers, are sick and tired of being nickel and dimed to death from the ever increasing taxes for these so called improvements.So I'm not supposed to get any benefit from my taxes now? Really? Thats the same kind of thinking that allows my tax money being sent to foreign countries as aid. Taxes were created to pay for things I'm supposed to get the benefits from.Not for projects that benefit the few and priviledged.Again,I do care about people and give money to charities to help the under privlidged but it's my money so therefor should be MY choice how and where it's spent.Not on some special interest pet project for the well to do's benefit.And I'm not complaining about improving the windsor road overpass which I might never use.It's the bike lane that contributes highly to the cost and having to shoulder the burden for all of it while the people that get the most benefit are given a free ride.Just because something that could be done could save lives doesn't automaticly mean it should procede.You want to know what else could and guarantee would save millions of lives? No more automobiles. But I don't hear you getting on that bandwagon and proclaiming it's idea.And I have no children but gladly pay taxes for education because it benefits the WHOLE of society,not just a select few.Yes I support the tax breaks for the building of the hotel.It provides a benefit to the WHOLE community by creating revenue in the form of property taxes,drawing in money from outside sources thus creating revenue,and lets not forget long term employment which creates... more revenue for the city.Unlike the church which is a private enterprise that is tax exempt and creates no wealth and doesn't report it's income so therefor no taxes on it's bounty.I live by the mantra,do the best you can,with what you have,where you are.I can't stop the state or federal governments frivilous projects but I can help stop the local ones.And I assure you,my convictions don't change just because it's the latest ideology like most of the sheeple that pass for citizens.In essence.This isn't about being taxed,it's about being overburdend with taxes to support projects that don't benefit the WHOLE of society and the few whom reap the rewards of those projects get it for free!

alabaster jones 71 wrote on May 14, 2012 at 5:05 pm
Profile Picture

Another post that only makes you look more self-centered and short-sighted from my perspective.  I think we are wasting each other's time and our own here.

By the way though, if you are worried about your taxpayer money being wasted, you should spending the vast majority of the time you spend on this issue worrying about the waste of tax money perpetuated by poor management of entitlement programs at the federal and state level, and by wasteful military spending.

If you want to worry about local chump change projects and about foreign aid (which is barely half a percent of federal tax dollars spent) instead, then that's your prerogative.  Enjoy focusing on a couple trees instead of the whole forest.

handyman65 wrote on May 14, 2012 at 10:05 pm

So someone is self centered and short sided because they are complaining about another tax increase for a pet project that only benefits the few? And them whom benefit the most pay nothing.Thats hilarous! Your prospective is liberal.You say your not and though you don't flash the badge everything you say screams it.If it walks like a duck and quacks like a duck,it is a duck.Like I stated previously,I can't stop the wasteful spending at the state and local level but CAN help fight it at home.Yes I worry about a  a few chump change projects because I,as one of the majorty, are tired of these chump change taxes,your words not mine, every time we turn around!Nickel here,dime there,it has to end.My take home paycheck looks like a piece of swiss chees already,and ALL these chump change tax increases is making it resemble a piece of termite infested wood.If you cherish the bicycle lane so much and want to be it's champion,why don't you donate some real monies to get it accomplished? Or does that not fit your socialist ideology?  My focus on a couple trees,instead of the forest,as you proclaim is the only way to end this madness.How is a forest cleared? Answer,one tree at a time! Hows that for short sightedness? Checkmate!

alabaster jones 71 wrote on May 16, 2012 at 1:05 pm
Profile Picture

lol, liberals, socialists.  nothing reveals someone to be as gullible and unknowledgeable about how politics really work as someone who fixates on left vs. right.  even if the liberal vs. conservative argument was actually valid, it would not really apply to local taxation issues like these anyway.

by the way, speaking of meaningless labels, what is socialism?  I would love to hear what you think it means.