The Gazette covers City Hall, now a flood-damaged icon on May's Island in the Cedar River

Council not using L-word or F-word, but it seems to sense: big hike in property taxes might louse up sales tax

In City Hall, Kris Gulick, Monica Vernon, Pat Shey on February 8, 2009 at 9:11 pm

At last Thursday evening’s budget meeting, City Council member Pat Shey put it this way: “We’re going to ask a lot from citizens this year.”

Shey mentioned higher fees: The proposed new budget includes a 14-percent hike in the city utility bill — for water, waste water, storm sewer and garbage services; and the proposed budget includes a brand-new 2-percent fee on electric and natural gas bills.

And then Shey mentioned the 1-percent local-option sales tax, which the council is asking voters to approve on March 3.

With the fees and the sales tax, he didn’t think the public would take kindly to a 14-percent boost in property taxes at the same time.

That level of property-tax increase was what the city manager had proposed for the fiscal year beginning July 1.

But Shey said, maybe the question was this: “What can we do to trim services.”

He wasn’t alone among council members, who sent Casey Drew, the city’s finance director, City Manager Jim Prosser and the city government’s department heads back to the drawing board. In short, the message was this: go find some place to cut.

One inference from what Shey had said is the council has the ability to louse up passage of the local-option sales tax if it doesn’t take it easy on property taxes, which is the principal revenue source for local governments in Iowa.

And the council – and a host of local groups from the Cedar Rapids Area Chamber of Commerce to Hawkeye Labor Council – doesn’t want to louse up the prospects for the sales tax, the revenue from which they say the city needs as it works to recover from the 2008 flood.

The sales tax will raise between $18 million and $23 million a year for Cedar Rapids for five years and three months.

However, it’s still unclear what the City Council is going to cut out of its proposed budget.

No council member has mentioned the L word – layoffs – or the F word – furloughs.

Two-thirds of the city’s 1,400 employees are in bargaining units, and the council pretty much agreed that those bargaining units wouldn’t have any interest in opening up contract agreements that are set to pay those employees raises of 3.25 to 3.5 percent.

So council members Kris Gulick and Monica Vernon said the council may have to lower wages for the other third of employees outside of bargaining units. The part-time council’s annual salary is tied to the cost of living index, which went up 1.1 percent in the last year, and maybe that is where wage increases should be for others, Gulick and Vernon said.

The City Council has been at its budget-making business for a good month now. That’s where council members have been Thursday evenings, and a Tuesday evening or two.

In the process, the city government’s department heads have trooped in, stating needs, making their cases for how to better deliver services.

Until last Thursday, it had been an odd few weeks. Everyone was asking for more. No one, including council members, was talking about less.

But then, after all, it was a time of recovery from a natural disaster.

Last Thursday evening, all those department heads were back, sitting, shoulder to shoulder, and listening to what the council had to say.

Suddenly, the tone shifted.

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  1. Maybe they should take a look at the “35 NEW” positions that are being added.

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