With the financial situation more stable than it was in September 2009, the village board on Tuesday voted unanimously to drop the remaining 2 percent tax of gross receipts on natural gas.
"I think we're demonstrating as we enact temporary taxes, we're doing what we can to make them temporary as we promised," Trustee Jim Moran said.
However, fees on two other utilities will remain in place, and officials remain wary of possible state actions that could sap revenue.
Facing a dire budget situation, the board in September 2009 enacted taxes on natural gas and electric use and increased the telecommunications tax to raise $2.5 million a year to offset falling revenues, including sales taxes.
The actions included sunset clauses to allow for review to determine if they should be reduced or eliminated.
The natural gas tax originally was set at 5 percent. But as conditions improved, it was cut to 4 percent in late 2011 and to 2 percent last spring. That percentage had been projected to produce $220,000 during the 2013-14 budget year, which begins May 1.
"We said these taxes were temporary and as things improved, we repeal them," said Trustee Rich Moras, who heads the village board's finance committee.
Village revenues have increased and cuts made in the past several years have resulted in a projected surplus of nearly $1.5 million for 2013-14 in the general fund, which pays for day-to-day expenses, according to Finance Director Pat Wesolowski.
Preliminary 2013-14 budget figures show revenue of about $24.7 million and $23.2 million in expenses in the general fund, according to Wesolowski.
Increases in water and sewer rates, as well as property and sales taxes, accounted for the largest revenue increases. The proposed 2013-14 budget projects sales tax revenues of $6.2 million, up nearly 6 percent from the current budget year. A budget hearing is scheduled for April 9.
Revenues also include a proposed increase of $327,000 in state income tax revenue, but there are proposals that could eliminate that, Wesolowski said.
"We do this," Moras said of eliminating the natural gas tax, "but we have to take notice of what they do in Springfield."
Mayor Terry Weppler said there were several possible state actions that could hurt the village's bottom line.
"Hopefully, we won't have to reinstate it," he said.