Gurnee raises phone tax, approves employee contract

Gurnee residents and businesses will need to dig deeper each month to pay bills for wireless and landline telephones as a result of a village board decision this week.

Trustees voted 4-2 in favor of increasing the telecommunications tax from 1 percent to 6 percent to raise an extra $650,000 annually for village coffers. The village board approved the tax hike at a meeting Monday.

Proponents said the cash will help bridge a projected $1.1 million general fund deficit in the tentative 2010-11 fiscal year budget that begins May 1. Mayor Kristina Kovarik also said the extra $650,000 will prevent employee layoffs.

"Our choice was to not pass it (phone tax increase) or reduce services," Kovarik said.

Trustees Greg Garner and Kirk Morris voted against raising the telecommunications tax.

Morris said the village should live within its means and work to attract more residents to shops and entertainment venues.

"The new telecommunications tax passed (Monday) night is going to further hurt the residents and businesses of Gurnee," Morris said in a statement he issued after the vote.

State law required approval of the tax hike by Saturday for the money to start flowing in July.

Meanwhile, the village board approved a two-year contract with public works and village hall employees covered by International Union of Operating Engineers Local 150.

Kovarik said the union contract vote came after the phone tax was raised. She said officials needed the telecommunications tax vote result first because employee layoffs would have been necessary without the extra money.

In exchange for a guarantee of no layoffs, the first year of the deal will not provide any base salary increase, but allows some workers to earn more if they step up the pay scale.

Kovarik said 2 percent cost-of-living raises will be awarded in the contract's second year. However, she said, the no-layoff guarantee isn't part of the second year.