Normal’s gas tax rate will double to 8 cents per gallon beginning Dec. 1, after narrowly passing during Monday night’s town council meeting in a 4-3 vote.
But officials said the hike, expected to result in $1 million in additional tax revenue for road and sidewalk repairs, won't result in higher gas prices.
“It has been demonstrated many times in many communities, a gas tax has almost no influence on the price you pay at the pump,” said Mayor Chris Koos, who voted in favor of the increase, along with council members Chemberly Cummings, Kevin McCarthy and Karyn Smith.
“It’s the best of not great choices,” to help the town meet budget challenges during the pandemic, said Koos.
Doing nothing was not an option, he said, and the gas tax rate increase is a way to increase revenue without making cuts to fire and police staff, or by raising property taxes--the latter being something unwanted by the council, town, or taxpayers, he said.
So far this year, Normal already has cut $6.4 million in expenditures, with COVID budget changes focusing on reductions to personnel and programs, said Koos. But additional cuts, as well as additional revenue, are needed to maintain necessary services.
Opposing the increase were council members Kathleen Lorenz, Stan Nord, and Scott Preston.
Koos and other proponents of the increase said that regardless of the past year of Normal's rate set at 4 cents per gallon, and Bloomington's at 8 cents per gallon, gas prices throughout the Twin Cities remained comparable throughout.
Bloomington increased its gas tax rate from 4 cents to 8 cents in May 2019.
“So far, small changes in local motor fuel tax has not impacted gas prices at the pump at all,” said McCarthy. Drivers pay the same for gas in Bloomington and Normal, he said, adding that Bloomington gets double the amount from the local gas tax for road repairs.
Looking across both towns Sunday, Cummings said she saw the price of gas in the Twin Cities ranged from $1.99 to $2.29 per gallon, demonstrating the higher local motor fuel tax rate in Bloomington doesn’t translate to higher prices there.
“Gas is determined by the market price, and the price per barrel,” not a local motor fuel tax rate, she said.
“We’re all struggling in this COVID pandemic,” said Koos, noting the virus’ impact has created an environment of declining revenue that requires Normal to cut spending, but to also to meet the challenges of maintaining transportation infrastructure like street repairs.
Smith said Normal is responsible for 439 miles of streets within the town limits, and the added revenue will help maintain those roads. Delayed road work would cost more in the long run, she said, adding spending cuts have been made, and will continue, but tax revenue is part of the solution.
“I do not agree with the scorched earth mindset that seeks to starve the government of any new revenue sources in order to obtain drastic cuts at all levels indiscriminately,” said Smith.
But council members opposed to the hike said they were representing their constituents' opposition to raising taxes.
“I don’t believe we should be raising taxes during a pandemic,” said Nord. Preston echoed that sentiment, while Lorenz added she’d prefer to see a combination of more cuts and new sources of revenue.
Nord complained that residents see their taxes go up, then learn the revenue doesn't go to the stated purpose. So, he proposed an amendment with wording that required all revenue from the gas tax hike be spent on infrastructure repairs to streets and sidewalks.
City Manager Pam Reece pointed out that such wording would mean the added revenue couldn't be used for operating costs, such as budgeting for maintenance workers who make repairs, or engineering staff that design repairs.
The amendmente failed on a 6-1 vote, with Nord being the only one in favor of it.
McCarthy later criticized Nord for accusing the town of misappropriating funds and said Nord owed the staff an apology.
In other business, the council:
- Approved Evergreen Village’s request to amend its site plan, at 1701 Evergreen Village Blvd. The assisted living facility will expand, with a new two-story memory care unit, and adding more parking --from 59 to 90 spots. Also known as McLean County Assisted Living, Evergreen Village’s first site plan was OK’d in 2006.
- Authorized a plan with Illinois State University, where ISU pays Normal $605,000 to provide fire and ambulance services to the campus for the year. According to council reports, the ISU Board of Trustees has OK’d the agreement that represents a 2.05% increase from 2019-2020.
- Changed a policy regarding the salary schedule for classified employees, or non-union workers. Now, instead of October and April adjustments, the salary scales will be configured in an annual adjustment set for April. This allows the town to delay the adjustments during the pandemic this fall. From now on, it will be an annual adjustment. Nord voted against the change, saying he didn’t agree with the new plan including the salary schedule vote as part of the annual budget.
- Re-approved the final plat for a block of apartment buildings on West Locust Street set to be redeveloped as a single high-density college-area apartment complex. The council had approved the Iden Subdivision plat in May, but was required to re-approve it Monday due to a bond issue with the developer.
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