BELLEVILLE — Flat or unpredictable tax revenue has Belleville city leaders proposing less than a 1 percent increase in general operating expenses this year.
The City Council will vote on Monday on a $113 million budget for the 2014-15 fiscal year, which starts May 1.
Revenue from the city's general fund, which pays for salaries and other operating expenses, is expected to go from $26.8 million to about $27 million, according to Finance Director Jamie Maitret.
Expenses will go from $26.7 million to about $27 million.
"We've never had such a small increase in the city's expenditure budget," Maitret said. "It's due to department heads being lean."
About 76 percent of the general fund pays for personnel costs, such as salaries and benefits.
With that in mind, Maitret said one would expect more of a budget increase with the majority of the city's employees getting at least 2 percent raises this year as outlined in their union contracts. The total of these raises amount to about $330,000.
The city also is still recovering from lagging state income tax payments and making do with less telecommunications and sales tax revenue.
The state is consistently about two months behind on income tax payments to the city, owing about $680,000 at a time, Maitret said. That compares to the state being about $1.5 million behind at the height of the recession.
Even though the situation with state income tax payments improved, the city is not in a better position because of a drop in other tax revenue, Maitret said.
The city's telecommunications tax is projected to be down $350,000 from $1.8 million, Maitret said. Sales tax, previously projected at $6.3 million, will also be down by about $350,000.
City leaders believe the drop in telecommunications tax is in part because of residents canceling landlines and using only cell phones.
But a tax revenue auditor the city hired last month said the city's losses is more than the state trend in declining telecommunications revenue.
The auditor will work to make sure the city is getting all the taxes it should from utilities such as cell phone, electric and cable franchises, Maitret said. For instance, sometimes residents move to Belleville but continue to pay taxes to their former city of residence because of company billing errors.
The auditor only gets paid if it finds such loss revenue. The company will get 45 percent for three years of the extra revenue it finds for the city.
Mayor Mark Eckert said it's unclear why sales tax revenue is flat or fluctuating, at best. The dip in sales tax revenue is recent and the numbers have been both up and down the past 24 months.
Eckert believes the city will see sales tax revenue improve this year because of the city's 200th anniversary celebrations. He urges all residents to remember to "Buy Belleville" whenever possible.
"People who live in Belleville and want Belleville services, we want them to do as much business in Belleville as possible," Eckert said.
Eckert and Maitret said the impact of these lost funds is alleviated in part by the $1.2 million the city is estimated to get by increasing sales tax by 0.25 percent.
Some aldermen and residents question why city leaders have not used the $1.2 million to hire more police officers, as was discussed when officials contemplated extending the tax increase or allowing it to sunset.
Maitret recommends waiting to see how the city's finances shape up in the next six months. By then, she hopes to have better information on the financing package for the city's planned police station and City Hall renovations; results of the tax revenue audit; and whether telecommunications and sales taxes improve.
The city's total budget is expected to be $113 million, with $13 million of that being a loan from the Illinois Environmental Protection Agency for the city's sewer plant project.
Last year the total budget was $118, including the Illinois EPA loan, which was $15 million.
The proposed budget includes money for the following projects:
*$380,000 -- Purchase, equip 11 SUVs for the Police and Housing departments
* $400,000 -- McClintock Avenue improvements
*$600,000 -- South Eighth Street improvements
* $200,000 -- Demolish, fill the city pool and bath house
* $300,000 -- Loflin Furniture, other demolition
* $1 million -- Down payment for the new police station
* $650,000 -- South First Street improvements
*$14 million -- Mandatory sewer system upgrades
*$300,000 -- North Illinois Streetscape project
*$685,000 -- Grant for playground equipment for Southside Park
*$10,000 -- Thermal Imager for the Fire Department
*$6,000 -- Picnic table replacements
*$45,000 -- YMCA improvements per development contract
*$12,000 -- Bicentennial Park building roof replacement
*$460,000 -- Citizens to Bellevue trail improvements, land acquisition.