Rockford Passes 2018 Budget With 5-Percent Utility Tax

Mar 27, 2018

Rockford aldermen on Monday approved the 2018 budget, five days ahead of their March 31 deadline.

The plan, conditionally approved last week as Plan B, includes the expected 5-percent utility tax Rockford residents will start seeing on their gas and electric bills.

The utility tax will generate $3.5 million in 2018 and about $9 million a year moving forward. Officials say it will cost residential and small business ComEd and Nicor customers around $10 per month, based on a scale created by state law. And while the tax will right the ship this year without raising property taxes, it’s not a permanent fix. A looming pension crisis and other economic woes in Springfield could result in systemic issues on the local level.

“In the short term, the utility tax is the easiest option,” Mayor Tom McNamara said. “In 2013, our pension obligation was less than $10 million. In 2017, our pension obligation was over $17 million. That $17 million is going to creep over $60 million by 2040. We will need new revenue at some point because you can’t cut your way out of this.”

Aldermen Tuffy Quinonez, Linda McNeely and Venita Hervey voted against the utility tax. Hervey has been a vocal opponent of the levy and said she cannot get behind it–not even reluctantly– because she promised those in her Fifth Ward she wouldn’t.

“It’s a promise I am not going to break,” Hervey said.

McNeely, who spoke out against home rule, said it’s time for Rockford to “face the music,” then voted “no.”

“The voters of Rockford voted home rule down,” McNeely said. “The voters knew this was a possibility. The mayor was adamant that this was going to come if home rule did not pass. The taxpayers of this city knew exactly what they voted for. But I don’t want to support a utility tax. For my constituents, five or 10 dollars is going to make a difference.”

Quinonez said he would rather look within for a solution. He said the utility tax, which is a regressive levy, will hurt senior citizens not only in the 11th Ward but throughout Rockford.

“I think we could have taken some more out of the fat in the city,” the longtime bar owner said. “We could have cut more services, more staff.”

McNamara said he is not in favor of the new tax either. And he agrees with some of the concerns echoed by McNeely and Quinonez but said neither came to the table with a concrete alternative.

“We had over 70 meetings talking about it,” the mayor said. “There’s nothing that crept up on a single alderman or should it have crept up on a single citizen.”

The 2018 budget leaves a surplus of about $350,000 that could be used in variety of ways.

“Our intention is to monitor the implementation of the financial task force recommendations,” Finance Director Carrie Eklund said. “And should we encounter delays in implementing any of them, the surplus would be a cushion. If the funds are not needed for balancing the operational budget, staff will recommend capital improvement to fire stations toward the end of the fiscal year.”

Some of the citizen-led task force recommendations include revisions to the animal services agreement with Winnebago County and changes in snow-removal services, building permits and business licenses.