St. Charles police station, road improvements included in new budget
A new police station, streetscape enhancements and roadway improvements are included in a nearly break-even budget approved this week by St. Charles aldermen.
The city intends to pull from its reserves to fund a handful of capital projects in fiscal year 2018-19, which begins May 1, Finance Director Chris Minick said. The budget doesn't include any new taxes or tax increases - there is a utility rate hike - but Minick said expenditures are likely to outpace revenues in upcoming years if new funding sources aren't implemented soon.
According to the budget, which was approved Monday in a 9-1 vote, St. Charles expects to spend nearly $195 million, but anticipates collecting $177 million. The difference comes from about $17.7 million in bonds for police station construction that will be issued to the city this month and spent next fiscal year, Minick said.
The city expects to use reserves as a down payment on the police station, and to plug a roughly $212,000 hole in capital project funding, Minick said. Officials initially considered closing that gap by implementing a 2-cent-per-gallon gasoline tax, but aldermen decided to remove the proposal from the budget and consider it at a later date.
Other anticipated capital projects include: enhancements to the First Street plaza and streetscape; roadway construction and maintenance; storm drainage improvements; and preliminary concept work for the Active River Project, aimed at beautifying downtown St. Charles and enhancing recreational opportunities along the Fox River.
To keep up with growing water, wastewater and electricity expenses, the budget includes a combined 3.2 percent hike in annual utility rates, Minick said. The city council is expected to vote on those increases next month. If they are approved, the average customer who spends $2,688 on utilities each year would see an $82 increase.
St. Charles has a history of being financially prudent, which has allowed the city to keep its property tax levy frozen at about $12 million for the last nine years, Minick said. However, the city recently has seen a $450,000 dip in state revenues because of a reduction in income taxes and a new 2 percent administrative fee added to home rule sales taxes.
"Operationally, I think we're in pretty sound footing," Minick said. "There are some significant projects that the city council has talked about ... and if we decide to undertake those projects, we're going to (need) a revenue base to proceed with them and to be able to afford them."
Aldermen are expected to discuss the proposed gas tax, the property tax levy and other potential revenue enhancements starting in June, Minick said. From those conversation, he expects the city council to provide some direction on additional funding sources that could be incorporated into the 2019-20 budget.