Politics & Government

Village, Trustees Respond to Bond's Tax Letter

At the request of Village President Marilyn Michelini, village staff responded to Trustee Stan Bond's recent letter to the editor regarding a proposed tax increase. The response sparked debate at Wednesday's Committee of the Whole meeting.

On Monday, Village President Marilyn Michelini publicly asked for a response to written last week by Trustee Stan Bond, and posted on Patch. Two days later, she got her wish.

At Wednesday’s Committee of the Whole meeting, Finance Director Jeff Zoephel distributed a four-page memo (attached to this story), responding to many of Bond’s points. In his letter, Bond questioned a to pay for street repair, and suggested that village leaders had not properly prioritized road repair in the past.

Zoephel spent much of his time Wednesday deconstructing Bond’s figures. Bond said he consulted the village’s Comprehensive Annual Financial Reports, but Zoephel said there are two other reports—one provided by the state, one by the village—that are also equally valid.

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Zoephel said that he could see how Bond arrived at his figures, and that he was close to the ones in the village reports. The difference, he said, could be explained by the differences in the reports—some are prepared using the fiscal year, and some the calendar year.

None of the three reports showed the 110 percent sales tax revenue jump between 2004 and 2010 that Bond suggested. Zoephel said the CAFR totals showed a sales tax increase of 86 percent. Similarly, that increase did not give the village an additional $4.59 million in sales tax revenue, as Bond wrote—the reports Zoephel cited differed in their figures, but the highest of them showed $4.28 million.

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And about $1.5 million of that was rebated back to developers, Zoephel noted.

Bond said he could have asked Zoephel to check his figures before writing his letter, but said he expected information on a publicly-available financial report to be correct. He confirmed that Zoephel did call him to go over his numbers before writing his response.

In his letter, Bond also suggested that the money the village receives from township road and bridge tax—roughly $135,000 in 2011—should be spent on street repair, and chided village leaders for not doing so in the past. Montgomery, like most municipalities, puts that money into the general fund, through which it pays for its streets department.

In the 2011-2012 fiscal year, Montgomery will spend about $1.6 million for its streets department. About $1 million of that goes to pay for trash removal, Zoephel said, so the village will actually spend about $600,000 working on the roads.

And Aurora Township Highway Commissioner John Shoemaker said that’s a perfectly valid thing to do. State law demands that township road and bridge tax can only be used to improve roads, but Shoemaker said the regular street department activities—patching potholes, erecting stop signs, even plowing snow—counts as “improving.”

Shoemaker attended Wednesday’s meeting, and said Bond “threw (him) under the bus” with his letter. He said township residents had contacted him, suggesting he should demand a refund from Montgomery.

“My constituents read that and said, ‘You’re not doing your job,’” he said. “So I investigated, and as far as I am concerned, Montgomery and North Aurora are doing exactly what is expected of them with road and bridge taxes.”

Bond said he intended to spark a policy discussion, and not to insinuate that the village had done anything illegal or untoward. Similarly, he said, his question of whether the village could handle an annual $2.2 million construction project was meant as exactly that: a question.

Zoephel's answer: in 2008, the village spent $2.17 million on roads (although since then the number has decreased), and managed other capital projects that same year totaling about $8.89 million, so it can be done.

Bond said he would defer to village staff on that one: “If (Engineer) Pete Wallers and (Public Works Director) Mike Pubentz think we can, I will accept their judgment,” he said.

The final paragraphs of Zoephel’s memo address the policy question Bond wished to raise: why the village did not use its expanded revenues to repair roads earlier. Zoephel said other revenue sources, such as development fees, utility taxes, grants and motor fuel taxes, were available between 2004 and 2010, and the village did not need to dip into its general fund to pay for street repair.

But more importantly, he said, the village’s population exploded during those years, rising from 7,109 to 17,062 residents. Providing services to those new residents cost the village an additional $7.24 million in wages between 2004 and 2010, Zoephel said.

That, said Trustee Matt Brolley, is a big part of the issue. Though it is fair to suggest that the village spend all of its motor fuel tax and road and bridge tax on street repair, the Village Board will still need to figure out how to pay for the services those monies currently fund, or figure out where in the budget to cut.

Of Bond’s letter, Brolley said, “There’s a lot of misinformation out there, and it’s hard to see one of us go out there with the wrong information.” He said residents who don’t attend Village Board meetings might read a letter like Bond's and come away with an incorrect impression.

“If you’re going to write something like that that implicates the village, you better be spot-on with your numbers,” he said.

Trustee Denny Lee also had harsh words for Bond.

“Everything is overstated,” he said. “It made the old trustees, like Pete (Heinz) and I and Bill (Keck) and Marilyn (Michelini) look like we didn’t do our jobs.”

Bond said he was disappointed in Wednesday’s discussion, calling it a “missed opportunity to discuss the real issue” of the proposed tax increase. The board is expected to vote on a tax referendum next month, and Bond would like to see more conversation about alternatives before that happens.

Bond said he has been asked to take his financial questions to Zoephel in the future, a request he called reasonable.

“If there were more of an atmosphere of trust, it would be easier to avoid situations like this,” he said. “Perhaps in the future, I’ll be more trusting and see how that works out.”


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