The city eyes a tax hike for public works
No one seriously argues that Springfield doesn’t need street, sewer and sidewalk repairs.
Anyone who negotiates potholes at 11th and Carpenter or the cracked-and-crumbling stretch of Ash between Third and Fifth or dozens of other intersections and streets knows that. Sidewalks, where they exist, are in such poor condition that the sight of kids riding bikes in traffic lanes or the disabled wheel-chairing on streets has become routine. So, too, has the sight of orange traffic barricades hurriedly erected while crews repair sewer cave-ins.
The question is what, exactly, should be fixed and how can we pay for it? And if we do raise taxes to make things better, will we really be better off than we were before? It is an age-old question in the capital city.
Back in the 1920s, nearly everyone, it seemed, wanted to spend lots of money on roads as a growing number of automobiles created a near-insatiable demand for pavement. Throughout the city, residents and business owners agreed to tax themselves to pave streets, and politicians based campaigns on their road-building prowess. Gov. Len Small campaigned during the Roaring Twenties as “The Good Roads Governor” and his supporters even wrote a song to celebrate his public works good works:
You can drive along this highway
Without a fear of harm
For Len Small has built these good roads,
Without a tax to man.
Some things never change.
“I think that within a 30-day period we will be talking about an infrastructure plan for the City of Springfield that is comprehensive, that can be done without raising any taxes or fees,” Mayor Mike Houston said when he was elected nearly two years ago, according to a State Journal-Register story published one month after the mayor took office.
It’s a promise the mayor now says that he never really made. Any vow to come up with an infrastructure plan within a month of taking office, Houston asserts, was an “offhand comment.” But it is a statement that has stuck with aldermen, who have been expecting and demanding an infrastructure plan for nearly two years. Now that the mayor has finally delivered one, not everyone is happy.
The mayor’s plan to borrow $86.6 million to pay for infrastructure fixes comes with a – surprise – tax increase, in this case a 1 percent sales tax hike that would boost the city’s tax rate to 9 percent and raise an estimated $17.6 million a year. Half of the tax hike would go toward repaying the loan, a quarter would be spent on additional fixes to streets, sidewalks and storm sewers and the remaining quarter – $4.4 million per year, by the mayor’s estimation – would be spent on sanitary sewers. The bond would be retired in 15 years, which is the expected lifespan of asphalt.
Houston says that he would prefer increasing monthly sewer fees to raise $5.5 million a year for sanitary sewers, which would leave the entire one percent sales tax hike for streets, sidewalks and storm sewers. But he says that he doesn’t have enough support on a city council that isn’t rushing to vote on either plan. Neither proposal is enough, the mayor says, but it’s better than nothing.
“Is it everything that we would like? The answer is no,” Houston says. “Is it everything that we need? The answer is no. … Is it something that we need? The answer is a resounding yes. … What we’re trying to do is deal with the worst that we have.”
Not enough votes
As anyone who has watched the Springfield City Council knows, predicting what aldermen will do and getting them to stake out positions prior to a vote is nearly impossible. But one thing is certain: If Houston had the votes to pass his plan, he wouldn’t be meeting with reporters to push it. And if it passes, it will likely be with no votes to spare.
“We are very, very close to having the votes, to be in a position where we would have a 5-5 vote and I would break the tie,” Houston says.
Not if Ward 7 Ald. Joe McMenamin has his way.
“I think we need to wait for the next mayor,” McMenamin says. “It’s premature to ask for as much as he’s asked. … He’s a tax-and-spend sort of person.”
McMenamin isn’t saying absolutely, positively no. But the alderman, who recently lost a bid to cap city employment at 1,500 workers, says he wants to see a commitment toward reducing municipal operating costs before he’ll consider a tax increase. Even then, McMenamin sounds like a tough sell. Before asking for a tax increase for streets, sidewalks and sewers, the mayor needs to figure out how the city would pay its share of relocation costs to move the Union Pacific railroad line from Third to Tenth Street, which Houston has consistently said is a top priority, the alderman says.
“What’s the mayor’s plan for railroad relocation?” McMenamin asks. “It seems like that should be part of a master plan.”
Ward 1 Ald. Frank Edwards also isn’t sold.
“I’m torn,” Edwards says. “The reason I’m torn is that I don’t know how much more we can expect people to pay.”
The city has raised taxes twice in the past five years to pay for infrastructure improvements. The first increase hit in 2008, when the city council passed a 2 percent hotel-motel tax hike and vowed to spend the money on infrastructure improvements. Just one year later, the city diverted more than $1 million of that money to fill a budget shortfall and avoid layoffs. The money was paid back to the infrastructure fund after Houston took office in 2011. In addition to the hotel-motel tax, the council in 2009 approved a quarter-percent hike in the sales tax that took effect in 2010, again to fund infrastructure improvements.
If the council approves a sales tax hike to fund a bond, that bond money could not be diverted to other purposes, supporters say. But there are no strings attached to money from any other tax hikes to pay for infrastructure, as the city showed when it diverted money from the hotel-motel tax. If the city hikes the sales tax to fund a bond for infrastructure, McMenamin predicts that money from prior tax hikes that was supposed to go for streets and sidewalks will migrate elsewhere.
Ward 2 Ald. Gail Simpson, who voted against diverting the hotel-motel tax in 2009, shares that concern. City leaders, she said, should remember what they say when they raise taxes.
“We promised – we promised – we would only use that money for infrastructure,” said Simpson, who supports the proposed sales-tax hike along with Ward 3 Ald. Doris Turner, Ward 6 Ald. Cory Jobe and Ward 10 Ald. Tim Griffin. “A promise is a promise, and people need to be able to rely on that.”
But Edwards isn’t optimistic that the city will resist the temptation to divert money from previous tax hikes tagged for infrastructure.
“You cannot mandate what a council will do two years from now, four years from now,” Edwards said. “When you get down the road, I guarantee that the city council is going to side with keeping people (municipal employees) working instead of infrastructure.”
But Edwards drives the same streets as everyone else.
“There’s no doubt in my mind that we need infrastructure spending,” the alderman says. “You’re going to have to make some hard decisions.”
The Greater Springfield Chamber of Commerce, which five years ago floated a short-lived proposal to raise gas and sales taxes to pay for infrastructure improvements, also acknowledges the need. The means, however, is a riddle.
“We agree with the mayor in the assessment of the need and the magnitude of the need,” says Steward Sandstrom, chamber president and chief executive officer. “And, additionally, we support the idea that there is more revenue that needs to be brought to the table.”
And where should that revenue come from?
“At this point, we’ll leave that to the city council to understand what is best for the community,” Sandstrom says.
A detailed list
Houston has given aldermen a list of projects that would be accomplished in three years if they raise the sales tax and float a bond. It is, he says, based on need, not politics. In the case of streets, which are rated from 1 to 5 (with 5 being the worst), every street in the city that is rated between 4.5 and 5 would get fixed, according to Houston and public works director Mark Mahoney. No attention was paid to which ward would get the most money, they say.
“When you look across the city, it’s spread out,” Mahoney says. “It was based on condition and rating. It wasn’t picked by ward.”
Don’t expect new curbs, gutters or sidewalks if your neighborhood doesn’t have them now.
“What we’re trying to do is deal with the worst we have,” Mahoney says. “We’re talking about simply maintenance. … Right now, we’re trying to stop the decline of what we have, take care of what we have. Modernization expenses are not in this infrastructure plan. Expansion is not in this.”
Jobe, who supports a sales tax hike for infrastructure, says that the city can’t afford to wait any longer. He points out that Scheels, where the sales tax is already 9 percent – 1 percent higher than the rest of the city – isn’t hurting for business.
“People don’t complain about Scheels,” Jobe says. I don’t think anybody is going to be talking about this. This is about leadership, plain and simple. … We have a problem everywhere.”
Jobe and the mayor say that a sales tax hike is the best way to raise money because it would be borne by people from outside the city who shop in Springfield stores. By that same logic, Simpson says that the city should put a tax on restaurant meals, an idea she’s been pushing for years. Such a tax is already in place in at least a half-dozen central Illinois cities, including Bloomington, Champaign, Decatur, Normal, Peoria and Urbana.
“All these places have dining taxes, and nobody complains about it,” Simpson says. “A dining tax captures so many people who don’t even live in Springfield. We’re not looking at them as a source of revenue. Dining out is a luxury. … You’re not targeting a particular industry, you’re targeting a particular group of people who eat out.”
Simpson says that the city should also consider a tax on package liquor that runs as high as 4 percent in Bloomington, Normal and Urbana.
“That, too, is a luxury,” Simpson said.
While other cities have different taxes than Springfield, they have the same problems with infrastructure, Edwards points out.
“I hear people say, ‘Man, our streets are bad,’” Edwards says. “Have you driven to other communities? Go anywhere and look at their streets, which is not an excuse to not take care of ours.”
Springfield, however, has a bigger challenge than other cities, according to figures from the public works department. Springfield has 625 miles of streets spread over 66 square miles. That’s more than 100 more miles of streets than Peoria, more than Bloomington and Champaign put together, more than in Decatur. Or Normal. Or Urbana. And, thanks in part to annexations along the city’s western border, the miles of streets that the city must maintain has skyrocketed since 1997, when the city owned 497 miles of roadway, 128 miles fewer than it has today.
Edwards is correct in saying that Springfield isn’t the only city that needs work. Since 1988, the American Society of Civil Engineers has published a series of reports warning that infrastructure everywhere is falling apart.
“Facilities in poor condition lead to increases in operating costs for trucks, cars and rail vehicles,” the society wrote in its most recent report issued this year. “Additional costs include damage to vehicles from deteriorated roadway surfaces, the imposition of both additional miles traveled, time expended to avoid unusable or heavily congested roadways or due to the breakdown of transit vehicles, and the added cost of repairing facilities after they have deteriorated, as opposed to preserving them in good condition.”
In short, it’s cheaper to maintain roads over time rather than wait until they need a massive overhaul. But money is in short supply. And if roads are bad, what lies beneath is even worse, according to Mahoney and the mayor.
An unseen problem
Houston wants to spend $5.5 million a year for a decade to fix crumbling sanitary sewers. Projects include replacing pipes, lining crumbling pipes with PVC material, fixing manholes and separating sewers in Washington Park so that stormwater and sewage flow through separate pipes. But just how much the city really needs to spend is anyone’s guess, given that the city has not surveyed the entire system by putting cameras through sewer lines.
Houston points to cities such as St. Louis, where the sewer district was hit with a $1.2 million fine in 2011 by the U.S. Environmental Protection Agency for failing to control pollution. In addition to paying the fine, the St. Louis sewer district must spend $4.7 billion over the next two decades to improve the collection and treatment system so that basement backups and sewage spills won’t happen anymore, under terms of a legal settlement with the EPA.
The St. Louis fine and settlement is part of a trend that took off after the EPA in 2007 announced that it would crack down on substandard sewer systems. Even before St. Louis made peace with the feds, EPA fines for bad sewers nationwide shot from $800,000 in 2008 to $1.8 million in 2010, and pollution control investments by defendants in lawsuits filed by the EPA for sewer problems went from $2.9 billion to $5.3 billion during that same timeframe.
Is it possible that Springfield will need to spend more than the mayor has proposed to satisfy the EPA?
“I would say it’s probable as opposed to possible,” Houston answers. “It would be better for us to deal with our own problems rather than have someone come in and dictate what we need to do. … Unfortunately, these are problems that have been ignored for years, particularly the sewer problems – where they’re not visible, it’s really easy to ignore it unless you happen to live in a neighborhood where you have a problem and you’re getting water in your basement.”
But McMenamin isn’t convinced.
“That’s the mayor’s approach to problems – he threatens the draconian,” the alderman says. “He overstretches and asks for too much. There are some significant unknowns out there. We don’t know what the EPA will ask. We don’t know what kind of sewer assistance we can get from the state.”
Edwards suggests turning the city’s system over to the Springfield Metro Sanitary District, which runs the region’s treatment plant and maintains 140 miles of underground collection pipes in Jerome, Leland Grove, Southern View, Grandview and portions of Springfield near Lake Springfield.
“If it gets turned over to the sanitary district, money (for sewers) is not going to get diverted to something else,” Edwards said.
McMenamin said the idea should be considered, but he is concerned about accountability, given that the sanitary district’s board is appointed, not elected. Turning the city’s sewer system over to the district isn’t a new idea, according to district director Gregg Humphrey, who says that the idea dates back at least 20 or 30 years.
“The question rises up a lot when the city realizes, ‘Oh my, there’s a big problem,’” Humphrey says.
Houston isn’t keen on turning the city’s sewers over to anyone, even though he acknowledges that it is often easier for an appointed body to raise fees than for an elected body to raise taxes. The mayor also agrees that giving sewers to the district would guarantee that money for sewer repairs and improvements wouldn’t be diverted. But he says that city residents should be able to go to elected officials when they have sewer problems.
“The sanitary district is in the business of treating sewage, they’re not in the sewer business – their expertise lies in treating,” Houston said. “It’s not a matter that you’re going to save dollars by doing the shift. It’s going to be the same taxpayers who are going to pay the money. Whether the city council wants to, for lack of a better word, abdicate the responsibilities over to the sanitary district or whether we deal with the problems ourselves, somebody has to deal with it.”
Ultimately, it comes down to aldermanic votes, regardless of whether the subject is streets, sewers or ceding control. And Houston sounds like a realist when it comes to infrastructure.
“My approach is, yes, there are certain things I would like to see done in a certain way,” Houston says. “The real question is, what can I get done?
“What I want and what I can get are two different things.”
Contact Bruce Rushton at email@example.com.
Infrastructure Improvement Plan by Ward
Projects highlighted in red are contingent upon Houston's plan being approved by the Springfield City Council.