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DeKalb City Council approves $1.5 million deficit budget for fiscal 2018

Sales tax vote postponed; motor fuel tax increase passes first reading

DeKALB – After multiple special meetings and numerous revisions, the DeKalb City Council was handed a fiscal 2018 budget with a $1.5 million deficit, which was passed by a 6-2 vote Monday.

The budget has $92.2 million in revenue and $93.7 million in expenditures, a reduction of about $582,000 in revenues and a reduction of about $1.3 million in expenditures from the original budget plan introduced in October.

First Ward Alderman David Jacobson and 6th Ward Alderman Mike Verbic voted against the first reading and waiver of second reading of the spending plan.

Jacobson said that he appreciated the council starting to focus on some of the structural issues that are costing the city money, but was not in favor of avoiding the issue for another year, which will make it that much harder to plan future budgets.

Fifth Ward Alderwoman Kate Noreiko admitted that the budget was not perfect, but it was an honest effort made on the part of city staff based on direction from the council.

“We have to take action, and I think making a grandstanding gesture of not passing the budget is falling into the same [mistake] that the state legislators did,” Noreiko said.

DeKalb Mayor Jerry Smith said the complaints that budget talks were condensed into a two- to three-month time frame were justified, but with discussions on the fiscal 2019 budget set to begin in January, the city will be way ahead of the game next year.

The City Council also authorized the 2017 property tax levy, which will fund portions of the DeKalb police and fire pensions, but will not fund the Illinois Municipal Retirement Fund. These shortfalls, totaling about $518,000, will be made up by general fund revenues.

This was approved by a 7-1 vote, with Jacobson voting no. The two proposed tax increases will require further discussion before being taken for a final vote.

A 2-cent motor fuel tax increase, which was proposed to provide additional revenue for the city’s underfunded streets, passed first reading but a waiver of second reading did not reach the required two-thirds supermajority.

This tax increase was preferred as a means of road funding over a half-cent home rule sales tax increase, which the council unanimously approved postponing a vote pending further discussion.

Verbic and Marquardt voted no on the first reading, but Jacobson joined them to deny the supermajority on second reading. Verbic said taking action on the increase is premature and preferred taking the issue before the city’s Economic Development Committee and local gas station owners to determine the local economic impact. Noreiko, however, spoke in favor of the proposal after the rejection of the sales tax increase as funding for deteriorating streets.

“While additional taxes are never a good thing and never easy to pass and not popular, I think we have a responsibility to pass this,” Noreiko said.

Second Ward Bill Finucane added that this was a revenue stream that would not be solely funded by DeKalb taxpayers, but would collect from motorists using the highway as well.

DeKalb resident Dwayne Brown said the solution to budget problems always has been more taxes and the vacant stores and downtown lots are evident of its success. He instead recommended looking back at the 5 percent general fund cuts that were presented by city staff in November and seeking other solutions as the budget in its current form is unacceptable. The 5 percent cuts would have eliminated 11 part-time positions and nearly $2 million meant for city departments. After completing surveys on their preferences from the proposed reductions, the City Council agreed to about $937,000 in cuts.

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