CHAMPAIGN -- City council members on Tuesday night voted to create a new tax, maintain an old one and still ended their meeting looking at potential budget cuts for the next fiscal year.
The nearly $20 million property tax levy the council supported is identical to last year's, even though the aggregate assessed valuation of the city is expected to drop 2 percent. That means, next year, average homeowners would pay property taxes equal to what they paid this year, even if their home values have dropped.
While the actual city property tax bill, on average, would not increase, homeowners would be paying at a higher rate: $1.3209 per $100 of equalized assessed value, instead of the $1.2942 rate the city has adopted in the previous four years. The council voted 7-2 in favor of the tax levy, with Deborah Frank Feinen and Kyle Harrison dissenting.
Council member Tom Bruno said, after several years of cutting millions from the city budget as costs outpaced revenues, it is time to start maintaining services.
"The fact of the matter is that city revenue is drastically down from prior years, and yet people still want us to provide police and fire and snow removal," Bruno said.
Had the council chosen to maintain last year's property tax rate, budgeters would have had $727,614 less to work with.
"At the end of the day, the services that we are providing to the public are ones that they feel fairly inelastic about, and they want these services to continue unabated," Bruno said.
In a separate but somewhat related discussion, in that it concerned a shortfall of revenues, the council took its first step in creating a 4-cent-per-gallon motor fuels tax to address a $60 million backlog in road projects.
City administrators' presentation to council members showed pictures of several crumbling roads in southwest Champaign, but Public Works Director Dennis Schmidt said the unfunded road projects are not limited to any particular area.
"This is a problem that we can find an ample number of examples throughout the city," Schmidt said.
A 4-cent gas tax is expected to generate $1.5 million annually in new revenue for the city -- enough to start chipping away at the aging concrete.
The vote was narrow: a 5-4 poll was enough to put a council bill to a formal vote within the next few weeks. Finance Director Richard Schnuer said, assuming the council affirms its preliminary support, the tax could be in place in roughly 90 days.
Council member Marci Dodds said road conditions are a recurring issue when she talks to residents in her District 4.
"It's good for motorists, it's good for selling our community, and I continue to hear about our streets," Dodds said.
Mayor Don Gerard said the roads are in desperate need of repair, and they will only get worse without the gas tax.
"We need to have a discretionary tax that addresses the issue directly, and we need to fix our roads," Gerard said.
Other council members were worried about the costs to consumers and businesses.
"I think, especially with the economic situation that we are in now, I don't want to see another nickel on this product, another dime over here on this product," said council member Karen Foster. "They do add up."