Wheeling opts for 7.5 percent tax levy increase, not 15

Wheeling won't have a Fourth of July parade or fireworks next year.

Nor will the village's municipal complex adorn as many holiday lights as it has now.

While those items together represent merely $40,000 in savings, they are among the roughly $3.2 million in cuts proposed to reduce a $5.3 million projected deficit in 2010 down to $2.1 million.

Proposed cuts and tax hikes for 2010 include eliminating more than 10 employee positions that have not yet been identified, raising the hotel/motel tax from 5 percent to 6 percent and deferring big ticket expenses such as street improvements.

To further trim the deficit, the village board Monday night agreed on a 7.5 percent increase to the village's 2009 property tax levy instead of the 15 percent recommended by the administration.

Wheeling's proposed 2010 general fund budget is $34 million. The village's total budget is $76 million for all funds, including water and sewer, debt service, police and fire pensions, tax increment financing, and capital projects.

Officials say the levy increase is required to fund state-mandated police and fire pension contributions that are collectively going up $1 million next year, and for roughly $1 million in increased salary and health insurance costs.

Trustee Dean Argiris said the village cannot shirk its responsibility toward employees.

"That's their money," he said of the required pension contributions. "They worked for it. They contribute toward it. We have an obligation to make sure those monies are there for them. None of us want to cut employees or cut services, but how do we pay our bills."

Wheeling Finance Director Michael Mondschain made the administration's case for why a 15 percent tax levy increase is required to counter declining revenues and deficits projected in 2011 and 2012. Officials estimate a $2.1 million dip in sales tax and a $473,000 drop in property tax revenues next year.

"If you look at the last 15 years, the average annual increase would be little lower than 4 percent even with a 15 percent increase next year," Mondschain said.

Yet, three of the five village board members present Monday night voted against the higher rate.

Wheeling's present tax rate is 0.707. With a 7.5 percent increase, homeowners currently paying $5,000 in taxes would have an additional $36 tacked onto their bills for the village's portion of taxes. Business owners presently paying $100,000 in taxes to the village would pay $484 more next year.

The village board also set a $1 million ceiling for the deficit and directed staff to cut more out of the 2010 budget.

"I still think we can make additional cuts," Trustee Dave Vogel said. "If we don't do it now and get our base to the point that's manageable, it's (the deficit) going to continue next year and the year after that."

A majority of the board nixed the idea of bringing back vehicle stickers that would have generated roughly $1 million in additional revenue.

Trustee Argiris argued it would drive businesses away to have what would essentially amount to an additional tax on vehicles.

"We're dipping into the pockets of property tax owners," Argiris said. "How much more are we going to tax these folks?"

Argiris said the village has to learn to live within its revenues and restructure services to break the cycle of deficit spending.

Wheeling has been consistently dipping into its general fund reserves, which have dropped from $20 million in 2007 to $14 million in 2009.

Village President Judy Abruscato said a vehicle sticker fee would be less expensive remedy to paying more in property taxes, but conceded the matter is dead for now.

The village board is expected to adopt the 2009 tax levy after a public hearing on Dec. 21.

Tax: Future deficit worries trustees