Crestwood mayor favors tax-rate hike to address capital needs

Sales tax for capital needs in Crestwood expires in 2017

Gregg Roby

Gregg Roby

By Gloria Lloyd

At an informational event set up by a resident last week, Mayor Gregg Roby said deferred capital needs are more than Crestwood’s budget can handle and he would favor a tax-rate increase to fix the city’s infrastructure.

Resident Ismaine Ayouaz, who was appointed by Roby last year to the city’s Parks Board, paid for and hosted the Aug. 27 “Vibrant Crestwood” meeting at the Community Center in Whitecliff Park, which could expand to a series of informative talks.

In response to questions from Ayouaz, Roby provided some basic facts about city government, noting that the city primarily relies on sales taxes for its $12.5 million budget since the residential property-tax rate is only 25.6 cents per $100 of assessed valuation, which equates to $97 for the owner of a $200,000 house.

“In Crestwood you’re getting your fire, your police, your parks with this 25-cent rate,” Roby said. “Obviously our challenges are limited by the amount of money we have to spend. We have done a good job of balancing our budget.”

The 2015 budget originally had a $653,117 deficit, and the city carried a similar deficit the year before that was balanced as the year went along through a series of positive variances. Since emergency expenses inevitably pop up, the city’s budget is always a “moving target,” the mayor added.

“We did dip into the reserves slightly,” Roby said. “So far this year, most of the expenses we have seen have been below what we have budgeted, so we’ve been able to save some money … Because we had the money in surplus, the dollars were there. (The reserve fund) is actually tax revenue that could have and would be spent if necessary.”

Besides money from sales taxes, the city receives 20 percent of its funds from utility taxes, 10 percent from licenses and fees and only 3.6 percent, or $450,000, from residential property taxes.

Most city revenue goes to pay the salaries of 92.5 employees, the mayor noted.

The contrast between the amount the city takes in from sales taxes versus how much it takes in with residential property taxes shows the importance of commercial development to the city, Roby said.

The city has compiled a list of needed facilities infrastructure repairs that is now up to $1.9 million, but the city’s budget for facilities improvement this year is just $300,000 and the list of needs is constantly growing longer, Roby noted.

A half-cent capital-improvement sales tax that brings in $1.1 million annually is set to expire in 2017 if voters do not renew it next year. Although Roby said it is unlikely that the Board of Aldermen would vote to place a tax-rate increase before voters right now, he supports a new 25-cent “specialty tax” that could raise dedicated funding for the $1.9 million of city facilities needs.

“We’ve put things off to the point where they now need to be addressed,” Roby said. “Maybe another 25-cent tax would cover it, that’s just a rough guess on my part. Once these were taken care of and paid off, something like that could be retired.”

When Roby was a Ward 3 alderman in 2008, he voted to place Proposition 1, a six-year, 35-cent tax-rate increase, before voters. The plan initially was recommended by then-Mayor Roy Robinson, and aldermen voted 7-1 to send it to voters, with former Ward 3 Alderman Jerry Miguel opposed. Voters rejected the tax-rate hike 71.66 percent to 28.34 percent.

At the time, Roby questioned whether the funds from Proposition 1 would be enough to solve the city’s financial issues.

The idea of building a new City Hall first came up during budget talks last year due to the current disrepair of City Hall, where a tarp covers the leaky skylight in the atrium.

“On a good rainy day, you’ll find four or five buckets in the middle of our City Hall lobby catching water,” Roby said. “We’ve got a wall outside the Fire Department that’s ready to fall over, the water damage is terrible. We’ve got cracks in our walls in our City Hall.”

The capital list includes $15,000 to replace the City Hall skylights, but not a new building.

City officials also hope to fund a number of Community Center upgrades and repairs, including $120,000 for an HVAC system, $80,000 for replacing part of the roof and $85,000 for new exercise equipment.

Some of the items on the list for the Aquatic Center are $120,000 for a splash pad, $120,000 for the second slide called for in the parks master plan, $35,000 for pool upgrades, $30,000 to sandblast and paint the lazy river and $20,000 for a new roof.

If aldermen do not want to place a measure before voters, Roby emphasized that they need to include enough money in each year’s budget for facilities so that the list of capital improvements does not keep growing at an unsustainable rate. Even without a dedicated tax, if money is allocated each year to facilities the board could maybe whittle away the list in five or six years, Roby said, noting that the list was much lower when he was an alderman.

But between then and now, the economy took a turn for the worse and Crestwood Plaza closed, he added.

“This number was down to $240,000, and it’s climbed to $1.9 million,” Roby said. “A lot of that is we’ve been through some tough times.”

Ayouaz distributed 500 fliers for the event, and eight citizens attended the meeting, including two former Ward 4 Aldermen, Steve Nieder and Michael Vincent.

Resident John Bell told Roby that any request for the public to increase taxes will be doomed if the city approves the $28 million in tax incentives, including tax-increment financing, or TIF, requested by the owner of the former mall, UrbanStreet, for a $100 million redevelopment plan.

“Any tax appeal will be dead in the water if in the interim — before, during or after this development — the city decides to give away $28 million, $2.8 million or $1 in taxes that are forfeited at the very time that there will be an increased pressure on police and fire and public works to serve that development,” Bell said.

Roby contrasted taxes paid by Crestwood residents to Affton residents, who pay $1.24 per $100 of assessed valuation to the Affton Fire Protection District, and Sunset Hills residents, who pay the Fenton Fire Protection District $1.04 or Mehlville 71 cents.

“We had a cash cow in Crestwood mall, and now that the mall’s gone, we’re still paying that same low tax,” he said. “And you’re getting four different services for that, your police, your fire, your parks and your streets, public works. If you divided those by four, that’s 6 cents for fire service. It’s pretty cheap.”