Wednesday, September 04, 2013
sponsored by

Mayor provides deciding vote; utility tax passes

Send a link to a friend 

[September 04, 2013]  This week the voting session of the Lincoln City Council was on Tuesday due to the Labor Day holiday on Monday. All eight aldermen were present for the meeting Tuesday evening as one of the most important topics to be voted on was whether or not to implement a 4 percent utility tax in Lincoln.

The tax was proposed as part of a plan to finance four specific projects for the city of Lincoln. Mayor Keith Snyder brought the plan he referred to as "Rebuilding our foundation" to the council several weeks ago.

In the plan, the 4 percent utility tax would be used to make payments for bonds issued to finance new facilities for the police and fire departments. The proposal left open how this would be accomplished, with the options being to build something new for both departments, or create separate facilities for each, possibly using already existing structures.

Another item on the list was funding of the city’s police and fire pension plans. The state of Illinois has mandated that municipalities fund the pensions to at least 90 percent by the year 2040. The city of Lincoln, like many other cities in Illinois, is not even close to having those pensions fully funded.

The plan also calls for money to be invested in upgrading city sewers as well as for downtown revitalization projects.

Throughout the discussions in past weeks, some aldermen, such as Melody Anderson and Tom O’Donohue, have made it clear they supported the proposal, while others, such as David Wilmert, have made it clear they did not.

In addition, concerned citizens of Lincoln have also come forward to express their opinions, again some in favor and some opposed.

Tuesday evening as the moment for the motion approached, Snyder said that once again there were people in the gallery who wished to speak about the tax prior to the vote.

First of those was Wanda Lee Rohlfs. Rohlfs has been strongly opposed to the tax throughout the process. As she took a seat at the speakers table, she told the council she wanted to thank all of them for responding to various emails she had sent them.

But, she said she still had questions and concerns. She noted that the statement had been made that local businesses whose consumption of electricity and gas is much greater than the average homeowner will pay the bulk of the tax.

Rohlfs said that when businesses see increases in costs, they pass those increases along to the consumer. Therefore, she said the residents of Lincoln will not only pay the tax on their own bills, they will ultimately pay the tax on the businesses as well.

Rohlfs also questioned some of the language in the ordinance document. In the document, there are several increments to the electricity side of the tax. The concept is that for the larger consumers, the higher their usage, the lower the price, but it will be graduated, in that a business that would perhaps use 4,000,000 kilowatt-hours would pay the tax at several rates, with each rate being slightly lower than the previous one as their consumption goes up.

Rohlfs said some of the explanations looked like they were duplicate amounts with different rates. She asked that the structure be clarified. She pointed out specifically one line that said 2 million kwh would be charged at 0.00256, and in the next line it said the 2 million would be charged at 0.00252.

It was explained that the rate was referring to the first 2 million at 0.00256 and the next 2 million at 0.00252.

Rohlfs also pointed out that she had two copies of the ordinance received at two different times. She said there were several areas where the two did not agree. Sue McLaughlin, city administrator, explained that the first copy was prior to the city finding out they had the wrong formula for figuring the tax on the natural gas. The second copy Rohlfs had was the true and accurate one the council would be voting on.

Rohlfs also pointed out an error in the numbering of the document, which is divided into "chapters." She was told that would be corrected.

Finally Rohlfs told the council that they had an obligation to pass an ordinance that was understandable, and this one wasn’t.

[to top of second column]

The second person to speak was Officer Matthew Vlahovich of the Lincoln Police Department. Vlahovich is the president of Fraternal Order of Police 208 as well as being the pension board president. He reminded the council that he had written a letter of support for the utility tax recently.

He said the letter had come as a result of a unanimous vote of the FOP that the union should support the tax. Vlahovich said the reason for their support was that the union understood the importance of the pension program and the need to bring it up to the recommended level of funding.

He said in addition to this, though, they also fully supported the proposal of a new police facility. He said such a facility with adequate space would increase the productivity of the officers, and that would in the long run lead to cost savings of its own.

Finally, he said the FOP understands that without this tax there will be no new revenue for the city that can help with these projects, and because of all this, on behalf of the Lincoln Police Department, he was asking that the tax be passed.

When he finished with his statement, Marty Neitzel addressed Vlahovich, saying there was one point that bothered her. She said she has always been opposed to this, but the fact is, there are officers in both the police and the fire departments who do not live inside the Lincoln city limits. Therefore, they will not be affected by the tax.

After Vlahovich left the speakers table, Snyder called for the motion. The motion was made by Anderson and seconded by O’Donohue. The floor was then opened for discussion.

Kathy Horn asked about the section of the ordinance that said the utility company would charge a 3 percent remittance fee for issuing the tax checks to the city. She wondered if that was a charge to the customer.

She was told it was not. Ameren Illinois will deduct the 3 percent from the gross check before it is sent to the city. Horn then asked for further clarification, saying, "Then this will not be 7 percent to the customer?" She was told it would not.

The last person to speak was Snyder. He said: "I apologize once again for asking you to take a difficult vote. It seems that is all we have done the past four years, is take difficult votes. That is a sign of our times in that we are faced with challenges all around. The council has made tough decisions in the past four years in a lot of different areas. We look back at things like budget questions and labor questions, and I would guess the FOP wasn’t happy with some of those decisions, but they respect you for those decisions. There are tough decisions all around, and I think now it is time for us to make another one."

The city clerk, Susan Gehlbach, was then asked to take the roll call vote. She began with O’Donohue, who had provided the second, and worked around the room. The votes went as follows: O’Donohue, yes; David Wilmert, no; Bruce Carmitchel, yes; Anderson, yes; Horn, no; Jonie Tibbs, no; Jeff Hoinacki, yes; and Neitzel, no. With the council split 4-4, it was left to Snyder to deliver the deciding vote. He voted in favor and the motion passed.

The utility tax is set to take effect Oct. 1.


Past related articles

Council heats up over kilowatts and therms
Utility tax discussions

< Top Stories index

Back to top