Monday, August 20, 2007

Top Ten Reasons for Not Supporting the Sales TAx

Here's a more organized presentation of the comments Dr. Linz C. Brown will make to the City council tomorrow night:

Top Ten Reasons

For Not Supporting the Proposed Sales Tax Increase

10. This proposal places small business owners in a no-win situation. In order to show support for SIU-- which many want to do--, the small business owners stand to lose some business. How much they will lose remains to be seen. One very prominent, local business owner who is a consistent supporter of SIUC and the community told me that he probably would support the proposal, but his business would take a “hit.” Already, a few residents have told me that they plan to buy out-of-town as a protest if this proposal is adopted by the Council.

9. The decision-making process on this highly unique and potentially divisive proposal does not provide sufficient opportunity for input from the 25,597 residents of Carbondale. Although four of you have the right to make a majority decision, I would think, under the circumstances, you would want broad support from the community.

8. The long-term impact of this proposal burdens and constrains future Councils; and, as a result, threatens future operations and services.

7. This proposal endangers the financial security of the City with too many obligations and too much dependency on sales and service taxes, especially in the event of an economic downturn. In the FY ’08 budget, sales and service taxes are projected to be approximately 72% of total revenue in the General Fund. You know what happens when you put all of your eggs in one basket.
6. This proposal burdens lower-income citizens of Carbondale with a regressive tax. The proposed sales tax increase will be on top of the gasoline tax and the telecommunication tax passed by the Council within the past four years. Is anyone on the Council concerned about the cumulative impact on low-income families? They are the ones I see most often in the retail stores and malls of Carbondale.
5. This proposal does not contain any attached agreements or written provisions that set forth the understandings and conditions for a commitment to SIU. Are you going to vote without knowing what you are committing to or without exploring the financial and legal ramifications of this commitment in writing? That would be totally irresponsible. What about the public? Don’t they have a right to see and react to any proposed agreement as part of the proposal before there is a vote?
What happens if there is an economic downturn and there are not sufficient funds to support the General Fund and SIU? What happens if SIU cannot raise sufficient monies to fund the Saluki Way project? Will they return the City’s investment? Will there be any provisions in an agreement for future Councils to cancel the agreement due to a financial crisis?
4. Approval of this proposal will burden the citizens of Carbondale with too many taxes and too much long-term debt. In the past four years, you have increased gasoline taxes and added a ten-year bond debt of $7.69 million to resurface and reconstruct streets. You also have increased taxes on phone calls with the Simplified Telecommunications Tax. And, last year SIU students received a 1% municipal sales tax increase on campus purchases. On top of this, there is the $800,000 annual expense for twenty years in support of Carbondale public schools. That is a total of $16,000,000. With this proposal, you want to add another $20 million of debt by giving $1 million a year for 20 years to a State-supported institution.
Mayor Cole, you stated in your 2007 Platform document that “The community has fared-well under the leadership of Brad Cole, someone who knows when a deal is worth making and also when the costs are just too high or the benefits are just too low to work out in the best interests of the community.” My question is how many taxes, how much spending, and how many millions of dollars of debt is just too high or the benefits too low for the best interests of the community.
3. This proposal is a cover for questionable revenue source changes, excessive spending and unprecedented deficits the past three years by the Mayor and Council. It is the first time in recent history that the Council is on track to complete three consecutive annual deficits. Council members and interested citizens should read the City Manager’s financial analysis and comments on pp. 1-3 of the proposal. The FY ’08 budget projects that the City next year will be within $10,522 of its minimum fund balance and that there will be an unfavorable balance of ($621,170) the following year (FY 2010). By policy, the minimum fund balance serves as a contingency fund for emergencies. This financial situation jeopardizes the City’s bond rating making it more expensive to borrow money. In short, the city is in a financial bind.
Mayor Cole, you stated in your ”Annual State of the City Address” on November 8, 2005 that “Our financial picture is perhaps the best it has ever been.” You went on to say that “Our General Fund balance today sits at a very healthy $7 million . . . .” It’s too bad that you and some members of the Council don’t read and take the advise of the City Manager. He has repeatedly pointed out in various documents, including proposed budgets, the fact that you are overspending and jeopardizing the city’s financial status.

2. This proposal ignores the $40,826,276 of unmet needs documented in the FY ‘08 Community Investment Program (CIP). There are no stated provisions or priorities in the proposal for these unmet needs. Who should be taken care of first, the citizens of Carbondale or SIU. I have always heard that charity begins at home.


1. This proposal bypasses the will of the people. The magnitude and length of this unprecedented commitment to spend $1 million a year for 20 years for non-city purposes needs broad support from the tax-paying citizens of this Community. For as few as four people to push the proposal through at this time would be an unwise and irresponsible use of power. Why an unwise use of power? Exhibit #4 in the proposal provides a partial answer. This exhibit lists the sales tax rates for 27 communities in Illinois and 10 local communities in southern Illinois.

I did some research on the reasons for recent increases and the decision-making process followed in other local communities listed in Exhibit #4 of the proposal. My focus was on cities with sales tax rates of 7.75% or higher.

DuQuoin is the first of those examples. It has the highest sales tax rate of the local communities listed. This city recently increased its sales tax rate by 1/2 percent, but the increase was voted upon by the citizens in a referendum, and the increase was used as matching funds to build a new high school. The community, not the council decided on the increase. (Source of Information: Telephone conversation with Bonnie Alvis, Executive Director, DuQuoin Chamber of Commerce, August 13, 2007)

Mt. Vernon and Jefferson County is another example. This is the second highest of local communities listed in Exhibit # 4 of the proposal. The City had only a 1% home rule sales tax as part of an existing 7 1/4% sales tax, but the county recently asked for an additional 1/2 percent for safety expenditures and debt payment in a successful countywide referendum. Again, the community decided, not the city council or the county board. (Source of Information: Telephone conversation with Mary Bechtel, Director of Economic Development, Jefferson County, August 13, 2007)

DuQuoin and Mt. Vernon/Jefferson County are not the only ones to establish precedents by using public referendums for large projects. The Carbondale School District used a public referendum in 1999 to fund the new high school. This is the same project for which the city contributes $800,000 a year. Why does the Carbondale City Council not want to follow these examples? Are we to be less democratic than our neighbors?

The scope of Carbondale’s proposal is beyond anything that voters entrusted to Council members. Why didn’t those proposing and supporting this proposal mention it to the voters in the last election. Proposals of this type do not come out of thin air. It takes time to formulate such ideas and to coordinate with key individuals at the university.

SIU needs to demonstrate that it has the capacity to raise $20 million that would match the proposed offer by the city. Why should the taxpayers of Carbondale be the major financial supporters of a State-supported institution?


SIU is important to this community and it deserves our support, but a financial issue of this magnitude and length of commitment must be carefully considered and must have broad support from the citizens of Carbondale.

I have heard that politics is the art of compromise. It is the extreme of my-way or no- way that bothers me whether it is at the local level, the state level, or the national level. The Governor’s stance on the State budget is a good example. I hope that this Council will do the rational and responsible thing by not voting for the proposal as presented.

I would urge you do one of two things: (1) authorize a public referendum on the current proposal, or (2) reduce the proposed increase to 1/4 percent, set up specific priorities with community input and discussion, stop deficit spending and unwarranted proposals, and lower the SIU commitment to a more modest amount.

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Why not just come out and say that the No. 1 for opposing this proposal is because Brad Cole came up with it?
That's really the reason, right?

Big ideas are rarely understood by small minds.

This tax will be paid by those who enjoy the benefits of Carbondale and SIUC -- not purely by those who live there. It takes some of the student burden away for the funding of Saluki Way. It will bring more green space and bike trails to the city. More police. A better firestation. Extends a finacial hand to the a**backwards park district. It will fund a statium that is enjoyed by students, residents and visitors.
And it will be done with pennies that for most people go un-noticed.

Time to think about what you're really opposing, Mr. Brown and company.
Brown listed ten documented and detailed reasons and you get from that that the core of his objection is Brad Cole?

Seems to me its more likely that you just like the proposal because Brad Cole came up with it. My logic? You only wrote one paragraph, so if Brown is guilty of it then you must be much more guilty.

Does anonymous have any arguments to support the tax proposal?

Had the City Council not repealed the Property Tax we would have the money for the Police Station, Fire Station, and Bikeways without having to raise sales taxes. Those are the kinds of things that should be paid for by property taxes.
What property owners????!! Carbondale is 70 percent renters.
What property owners????!! Carbondale is 70 percent renters.

Well, those renters pay their rent to someone, don't they? Landlords own those properties, and they are the ones who benefited most when the City Council chose to repeal the property tax. Did rents go down after the property tax was repealed? No, landlord profits went up.

It was a bad idea then, and as we are seeing, it is having very real (and negative) implications for how we bring in money for important infrastructure and service needs in this city.
Um, renters rent FROM someone.
What the opposition to this plan fails to understand that if SIU weren't here, Carbondale would probably known as West Carterville, or perhaps Southern DeSoto. What's good for SIU is good for Carbondale. Just ask all the people who make a decent living off the university and its students. To me their opposition to this plan is very, very shortsighted.
What's good for SIU is good for Carbondale.

No, that kind of thinking is short sighted and lacking in any critical thought.

Just because SIU wants something, doesn't mean that it is good for the community and vice versa.

I don't just take the University's word on what is 'good' for them, and what the community should do for them. No one should.

More cooperation between the University and Carbondale is a good thing, as far as I'm concerned. But that doesn't mean we should do what the University wants on their terms.
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