I am writing on the issue of raising Montgomery's sales tax rate because the Ledger Sentinel has chosen to editorialize in favor of it and I think additional points of view would be useful to the public discussion. The key argument seems to be a need for road repair.
Montgomery's revenue from sales tax has already increased 110% between 2004 and 2010, from $1.26 million to $2.59 million a year. This increase is the result of business growth, not tax increases. During this period, the village has realized a whopping $4,589,302 in additional sales tax revenue over the 2004 baseline. Did we spend that extra money on road rebuilding and repair? Not so much.
Montgomery's spending on road repair and rebuilding during these years of budget growth remained pretty constant, at least until 2007 when we began buying road salt from motor fuel tax revenues and thereby spent considerably less each year on road repair. Also frustrating to me is that the monies we receive each year from township road and bridge repair fund contributions (about $125,000 last year) have been dumped into the general fund rather than set-aside for road repair.
So, if road repair and rebuilding is the reason we need to raise sales tax rates now, in the worst economy since the Great Depression, why didn't we use the $4.5 million windfall from earlier growth in sales taxes for road repair? And what assurance might the public have now that revenues from an increase in the sales tax rate would be restricted to future road repairs?
Can we even manage the $2 million per year in road construction projects being tossed around as driving the need for this sales tax increase? Such expense would be a 5 fold increase in construction activity over what we do now.
I think there's more to this issue than a casual glance will reveal. Montgomery's revenues have increased dramatically over recent years, and yet here we are talking about underfunding of critical needs. Clearly we got to this place because of past spending choices and not because of any revenue shortfall. As early as 2003, Village staff and Board were warned about the risks of failing to set-aside sufficient funds for road rebuilding and repair.
As a new Board Member, I was not involved in developing previous budgets, but I am looking forward to my first turn at future budgeting. The question for me is: "Why weren't the revenues the village enjoyed through this period of growth enough to keep pace with maintaining our roads?"
Montgomery's general fund revenue has grown from $5.87 million in fiscal year 2005 to $8.65 million in fiscal year 2011. That's a 47% increase! Our cumulative revenue growth from that 2005 baseline has yielded an extra $2.78 million in spendable cash. Was that additional revenue used for road repair and rebuilding? Well, again, not so much.
Personally, I must be from Missouri, because I'm still not convinced on this issue. If you have an opinion, I think the Board of Trustees would appreciate hearing from you now, while we're still deliberating. You are welcome to speak at any board meeting or to write any of your 6 Trustees or the Village President. Please do. To follow is a link to their contact info: http://www.ci.montgomery.il.us/board.htm
Montgomery Village Trustee
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