No consensus yet on sales tax, garbage fee in Naperville
Naperville City Council members considering ways to fill a budget shortfall and replenish reserve funds don't yet agree on the best course to take.
Council members Tuesday night debated the right amount for a proposed sales tax increase and discussed the best way to charge a higher garbage fee: On a utility bill paid by households receiving the service or on a tax bill so properties worth more pay a larger share.
A proposal set for a vote Sept. 15 calls for a 0.5 percent home-rule sales tax to be added Jan. 1 so the total rate would be 7.75 percent.
Council members John Krummen, Judith Brodhead and Becky Anderson, along with Mayor Steve Chirico, said they support the 0.5 percent sales tax increase to help pay back the city's $120 million in debt and build up city reserves, which are about $18 million below required levels.
But council member Kevin Coyne suggested the city instead add a smaller sales tax increase of 0.25 percent beginning July 1, 2016, when a 0.25 percent sales tax imposed by the DuPage Water Commission is expected to expire. The new Naperville tax he suggested then could sunset at the end of 2020.
Coyne said waiting to implement a sales tax increase until next summer would allow time to review expenditures and look for savings.
“If we wait until (the end of) June 2016, we can enact the tax without having any effective change because it simply would be replacing the water tax that will be ending,” Coyne said. “At 0.25 percent, we would remain the lowest in county for purposes of competitiveness.”
Council members Paul Hinterlong and Rebecca Boyd-Obarski said they side more with Coyne's idea, and Boyd-Obarski suggested an earlier sunset in two years for the potential 0.25 percent increase.
The council heard divided messages from residents at the meeting, too, with one speaker saying the sales tax increase is not sound financial policy, another supporting it as the only way to guarantee future prosperity and a third saying a full 1 percent sales tax should be added to reap the most benefit.
The council also heard and expressed mixed opinions on a proposed garbage fee increase to help the city fill $5 million of a budget gap estimated at $6.8 million. City staff members have been tasked with closing the rest of the gap.
Krummen said adding the increased cost to utility bills would be “a very simple process.” Under this proposal, the 41,500 housing units that receive city garbage service would be charged $12.35 a month instead of $2 a month.
But Hinterlong said he'd prefer it be added to the property tax bill. A couple of council members said they remain undecided about the best way to charge the fee.
“All of these ways have something fair or unfair about them. It's not an extremely easy decision to make,” Brodhead said. “I honestly have not decided which is the better way.”
The majority of council members seem convinced a garbage fee increase is needed to balance the budget — to the frustration of Bob Fischer, president of the Naperville Area Homeowners Confederation, who said the increase would unfairly burden single-family homeowners.
“Don't solve the budget hole on the back of homeowners,” Fischer said. “Give us a break.”
Action that could increase the garbage fee and set a home-rule sales tax is expected during the council's next meeting at 7 p.m. Sept. 15 in the municipal center at 400 S. Eagle St.
Chirico said it's important to make financial changes now to prevent debt and the budget gap from worsening.
“We're trying to spread this out and make it as fair as we can across the community because it benefits the entire community,” Chirico said. “There is no way to put this that people are going to be happy. This is a bad situation.”