The Pekin City Council on Monday proposed 4.9 percent levy increase and the abatement of two bond issues.
The Council voted 4-3 in favor of the levy with Mayor John McCabe, and Councilmen John Abel, Michael Ritchason, and Rusty Dunn voting in favor. Councilmen Tim Golden, Lloyd Orrick and Mark Luft voted no.
City Manager Tony Carson said the levy increase of 4.9 percent is needed because of the finances of the city and for it to go in the right direction.
“Unfortunately, as of this (fiscal) year ending (April 30), the city has 19.3 percent in the reserve fund balance,” said Carson. “And as everyone’s aware, we do have a recommendation that 25 percent should be in reserves for our general fund.
“Just a year before that, our fund balance was 22.1 percent, so as you can see were definitely going in the wrong direction. The 4.9 (percent) is much lower than what the staff presented just a month and a half ago. We know that the increase being presented is not going to cover all of our obligations. In the past when you had a levy, you actually had money going into the general fund. This time, unfortunately, even with the 4.9 percent, we’re going to be left with a $549,762 deficit for the fund to have to make up for the pension.”
The levy will bring in $6,482,362. The estimate tax rate of $1.46 per every $100 Equalized Assessed Valuation to generate the levy is based on an estimated city EAV of $443,422,877, according to city documents.
The increase will result in less than a $20 increase to the owner of a $100,000 home, Treasure Jim Wolf said.
Wolf provided a history of the levy for the Council. In 2002, the city levied $2.9 million. In 2015, the council levied $5.1 million. Fire and police pensions have increased by almost $3 million.
Councilman John Abel said, “We kicked the can last year, we did 0 (percent). We were asked for 4.9 (percent). The cans dead — the barrel has stopped. It stopped tonight.”
Able said the general fund will be depleted if the Council continues to pass 0 percent levy increases. “Doing nothing is just about as bad as anything you could do.”
Councilman Tim Golden asked what has been done since last years levy to improve the financial status of the city. He said in regards to Wolf’s comparison of Chicago to Pekin, a comparison should be made to their median income levels, the school poverty rates and property values.
“We’re supposed to feel like we’re in the same boat, according to you ... when there is nothing else that is equal,” said Golden. “It’s apples to oranges in comparison.”
Golden said when the Pekin Hospital loan for a new physicians center came before Council, they were told by staff that the city was on solid financial ground. He asked what has changed.
The Council approved two bond abatements. This year’s abatement includes a payment of $318,250 for 2013 bonds for capital improvements, and $591,752.50 for 2010 bonds sold for the sewer treatment plant improvements.
Follow Sharon Woods Harris at Twitter.com/sharrispekin