‘Public forum’ on financing city road-building

People voiced support for and offered alternatives to a proposed three-quarter cent sales tax increase during an Aug. 3 public forum hosted by the Rockford City Council Finance & Personnel Committee meeting. City officials planned the forum following the committee’s July 27 informational meeting.

Burpee Museum Executive Director Lew Crampton suggested the city explore joining forces with Winnebago County. Crampton described such a merger as being “very effective.” He said the cooperation of Chattanooga, Tenn., and Hamilton County. That cooperation, Crampton said, included establishing a design center, which was fully staffed and offered information about area projects to residents.

Crampton also said the city needs to increase its political clout by having regular meetings with state and federal representatives. He said the city needs to improve its performance in that area: “We’re not doing it systematically enough.” According to Crampton, the city is being “pennywise and pound foolish” by not employing a lobbyist.

Ald. Daniel Conness (D-14), who drafted the proposed tax resolution, said the forum presented a good opportunity: “It’s important to try to get the general public to hear or understand.” Conness said the referendum stands a better chance of passing, if people are informed.

“If people knew all of the aspects of this proposal, I’m sure they’d be supportive,” he said.

Conness reiterated that his proposal calls for a three-quarter cent sales tax increase, which would sunset in Spring 2009—coinciding with the re-election of all 14 aldermen and Rockford Mayor Larry Morrissey.

He said his proposal would function exactly like all previous road referenda and noted it would relieve Rockford citizens of the city vehicle sticker. Food, prescription drugs and titled property would be exempt. The sales tax increase would generate about $12 million annually.

According to Rockford Public Works Director Bill Bittner, if the referendum went on the ballot in November and passed, the city could collect the funds July 1, 2007 and fund a partial capital improvement program. Bittner said the city wouldn’t see any revenue until Jan. 1, 2008, and there’d be no 2008 capital improvement program.

He expressed concern about the proposed 2009 sunset. Bittner said while it might earn more of the public’s trust, the city would have less with which to work.

Conness said, under his proposal, Rockford property taxpayers would pay no bond, and their tax rate would decrease. He noted visitors would help finance road projects.

Kathy Guzzardo, whose husband and his employees own Guzzardo Music, described the proposed sales tax increase as a “regressive” tax. Guzzardo said the sales tax increase would affect the most vulnerable groups: fixed and lower-income families. But she said she’d support the increase on one condition—as a last resort.

According to Guzzardo, it would drive business from Rockford. She noted the city is now part of a worldwide marketplace, thanks to the Internet. Guzzardo said Internet sales have increased rapidly and noted no sales tax is collected for online purchases.

She said she’d support efforts to tax Internet purchases.

Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Nebraska, New Jersey, North Carolina, North Dakota, Oklahoma, South Dakota, and West Virginia will begin urging Internet companies to collect sales taxes this Fall, according to the Associated Press.

Guzzardo also suggested using a portion of Winnebago County’s jail sales tax, increasing the hotel-motel tax and increasing taxes on alcohol and cigarettes. But she put the most stock in taxes on Internet sales: “What a gold mine this would be. It would solve our funding problems forever.”

“It is a discussion about some of the future of this community. We have a community that’s evolving from the past to the new century,” Bittner said, during his introductory remarks.

Bittner described the road projects finance picture in the face of the failed April 2006 1 percentage point sales tax increase. While $365,000 was earmarked for road maintenance, nothing was set aside for neighborhood street repairs or storm drainage, he said.

According to Bittner, more than $900,000 was allocated for arterial and collector roads as well as community development. He said $3.3 million was put toward major projects. Those large projects include the Morgan Street bridge, Harrison Avenue and Kishwaukee Street projects.

He said a question must be answered: “Does the community want the projects to move forward?”

Bittner stressed federal and state investments in such projects hinge on the city’s investment. He noted that the city has received federal funding for the Morgan Street project, but had to make an $8 to $10 million investment.

The Harrison Avenue project, Bittner said, has a $25 million price tag. He said the city must contribute between $6.25 and $7.5 million to the project. According to Bittner, the federal and state governments are slated to invest $125 million in a variety of city projects, while the city’s share is about $25 million.

Winnebago County Taxpayer Advocates’ Tim Emert said he’s “not sure (the Advocates) were responsible for the referendum’s failure.” But Emert now stresses that “the sales tax is the way to go.” He said he’d lobby the Winnebago County to reduce the jail tax by one-quarter cent and institute a countywide .5 cent sales tax increase.

But Emert cautioned that timing was everything. He noted that the only time a road referendum has failed was when a school referendum was on the ballot: “Let’s put our children first. We want to be part of the solution.”

Andy Benson of Benson Stone Company said the jail tax contributed to his opposition to the referendum in April: “The jail tax is really part of the problem. That kind of precludes too much piling on.”

From the Aug. 9-15, 2006, issue

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