Champaign sales tax funds to go to roads, projects

Champaign sales tax funds to go to roads, projects

CHAMPAIGN — Potholes and business development will get a big chunk of the quarter-cent sales tax increase that went into effect at the beginning of this year.

Even though it's technically next year's money, city officials expect to move forward quickly with hundreds of thousands of dollars' worth of repairs to the most pothole-riddled roads in Champaign after a harsh winter.

That will be the most immediate effect of the city council's budget talks Tuesday night, when members took some early looks at spending priorities for the fiscal year beginning July 1.

"I don't want to paint a gloomy picture here, but we're not even to the worst pothole month," said Public Works Director Dennis Schmidt.

Typically, the worst month is March, and the roads will only get worse as spring arrives.

City officials hope to have legislation for that road work before the city council this month. Fixes would include dozens of areas, particularly busy streets, that have occupied the pothole crews over and over again.

Beyond that, details and dollar amounts behind the specific economic and capital projects they'll pay for next year with sales tax money are still not entirely clear, but council members on Tuesday night started narrowing down how they want to use the remaining $1.7 million of the $2.8 million they expect to get with the tax bump.

Last year, not long after approving the quarter-cent increase, which brought the city's total sales tax to 9 percent, city officials sent an extra $1.1 million to the police and fire departments but left decisions about the remainder until this year.

Still ahead of city council members is a much larger discussion about how to address ever-increasing pension obligations, said City Manager Dorothy David. Some city council members said they did not want to lose sight of that looming discussion, as a structural deficit is expected to eat away at the budget in coming years.

Among the short-term programs city council members discussed Tuesday was a "virtual small-business incubator," which city officials envision essentially as a website that would put together all the local resources available to new businesses.

Those resources to give a hand up to emerging businesses are already present in the area, said Planning and Development Director Bruce Knight, but they are not always so easy to find.

"One's over here, one's over here, and I have no idea how to find my way through that maze," Knight said.

The virtual incubator could offer opportunities for business plan development, business startup, and ongoing operational support.

City council members also talked about spending up to $200,000 on a program to help with building improvements or business startup costs in low- to moderate income neighborhoods.

Some city council members were hesitant about the assistance program, but council member Paul Faraci said it is crucial to complement the incubator.

"I think it would be devastating not to provide the electricity needed in the incubator with funding," Faraci said. "There are existing resources. They may not be all together. But without the funding, I think it would be just another website with no teeth."

The discussions Tuesday were in anticipation of city officials beginning their annual budgeting process. The formal decisions about dollar amounts will be left for when council members look more closely at the budget in the spring.

But with the unallocated sales tax revenue set to come in during the fiscal year beginning July 1, city council members were tasked with what programs to add to next year's spending plan. That's in contrast to the recent years coming out of the recession when they faced harsh spending cuts and a paring of city services.

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