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Budget Shortfall to Fix Village Roads May Lead to Tax Increase

Apr 10, 2014 02:17PM ● Published by Steven Jack

Oswego Village Hall Courtesy Flickr Creative Commons/Village of Oswego Tourism Bureau

A several million dollar hole in the village of Oswego’s road maintenance fund over the next four years has village officials contemplating ways to fill it. 

According to budget documents, the village could come up about $5 million short through 2018 in its road maintenance fund. To shore up the funding, village staff have recommended a quarter to half percent increase to the village’s Home Rule sales tax or a possible 4-cent per gallon increase in the village’s motor fuel tax.

Village Board Trustees will have to decide soon on how to fund the road program for next year at least, as the 2014-15 village budget must be adopted by May 1. A public budget hearing will be conducted at 7 p.m. Tuesday before the regularly scheduled Village Board meeting. 

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Village President Brian LeClercq said Thursday he's not sure a tax increase will happen for this year’s budget cycle because other cuts for 2014-15 likely will help fund the $837,000 road budget shortfall this year. 

However, the escalating shortfall through 2018 eventually will need to be addressed in a more substantive way, LeClercq said. The village is projected to come up $1.6 million short in 2016, $1.5 million in 2017 and another $1 million in 2018, according to budget documents.

A quarter or half percent increase to the village sales tax may be the least painful to residents, LeClercq said. The current sales tax in the village on everything but food and prescription drugs is 7.75 percent.

“If we have to raise a tax, I will vote for the one that will affect our residents the least, and spread it out to the folks that use our roads,” he said.

A recent village study showed that 51 percent of the village’s sales tax revenue is collected from people living outside the village. 

LeClercq said cutting other costly capital improvements in the next few years could be another answer. 

“If the board doesn’t want to advance on a few capital improvement projects, we can wipe it all out right away,” he said. 

The village has projected capital improvement expenditures of more than $70 million in the next five years. About $11 million of that total is for infrastructure improvements near the downtown riverfront, including the old Alexander Lumber site. 

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