Springfield City Council Approves Sales Tax, Sewer Rate Hikes

Springfield aldermen Tuesday night approved two of Mayor Houston’s four proposed citylogooptions for funding long-term infrastructure projects.

Aldermen voted 6-3 to raise the city sales tax from 8 percent to 8.5 percent.  The increase will go into effect January 1, 2014.  The new revenue will be dedicated to $86.6 million in borrowing for repair of roads, sidewalks and storm sewers.

The Council voted 6-4 in favor of a plan to pay for sanitary sewers through a low-interest loan from the Illinois EPA.  Mayor Houston cast the deciding “yes” vote on that ordinance.   The loan will be paid off over the next 20 years through a gradual increase to sewer rates.  Rates will go up 5 percent each year for the next ten years.

Aldermen Tuesday night opted not to pay for sanitary sewer projects with a one-quarter of one percent sales tax hike.

They also rejected an option that would have funded maintenance of streets and sidewalks by increasing the sales tax by an additional one-quarter of one percent.

Alderman Steve Dove was absent Tuesday.  Ward 7 Ald. Joe McMenamin told the Council that Dove contacted him to ask that they not delay voting.  Dove co-sponsored the ordinance for the EPA sewer loan, but previously voiced opposition to raising the sales tax.

The two ordinances passed Tuesday are 2013-124 and 2013-127.  The two that failed are 2013-125 and 2013-126.  Here are details on all four.

Ordinance 2013-124 (passed 6-3):

  • ½% sales tax increase to fund $86.6 million bond issue that will fund a 3 year program targeting worst streets, sidewalks, and storm sewers.
  • 15 year pay off to match the average life of asphalt overlay, would allow overlay of 135 miles out of the 360 miles of asphalt streets in the city.

Ordinance 2013-127 (passed 6-4, Mayor Houston voting “yes”):

  • Houston: “will propose a new approach to paying for our sewers which I believe are on the brink of collapse”
  • IEPA Clean Water Initiative would allow city to borrow funds at low interest rates
  • Would borrow $6 million a year from the EPA on an annual basis for 10 years, paying each loan off over a 20 year period
  • Would fund $60 million in total sewer projects over the next decade
  • Would require increasing the sewer fee by 5% per year for 10 years
  • Average household in Springfield (10 units of water, $9.40 per month) would see less than $.50 monthly increase each year – total increase of roughly $5.00 by 2024.

Ordinance 2013-125 (failed)

  • ¼% sales tax increase to fund ongoing maintenance of streets, sidewalks and storm sewers.

Ordinance 2013-126 (failed)

  • ¼% sales tax increase to fund the $55 million of combined and sanitary sewer projects
  • Would take approximately 12.5 years to fund

-Peter Gray

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One Response to Springfield City Council Approves Sales Tax, Sewer Rate Hikes

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