Crestwood officials stop short of saying services would be cut if voters reject tax hike

Proposed hike won’t be used as threat of cuts in service, Foote says

By BURKE WASSON

If Crestwood residents reject a tax-rate increase proposed for August, aldermen indicated last week they would have to make tough choices, but stopped short of saying services would be cut.

During a May 8 work session, Crestwood aldermen reached a consensus to seek a six-year, 35-cent tax-rate increase to help offset declining revenues and increasing expenses.

As another reason for the proposed tax-rate increase, city officials have also identified three town-hall meetings that took place this year in which residents indicated they would prefer that the city maintain the same level of services that it now offers.

But city officials reported at an April 30 town-hall meeting that “the city may not have enough revenue to cover those expenditures” in 2008.

Because of a 12.6-percent drop in sales-tax revenue from the first quarter of 2007 compared to the first quarter of 2008 along with the city spending $2 million in reserve cash on hand to fund first-quarter expenses, aldermen see a need for a tax-rate increase.

But Ward 4 Alderman John Foote said that just because city officials are asking for a tax-rate increase does not mean they are threatening to cut services if it is not approved. While he acknowledged that city officials would have to “look hard at what we can provide” if the proposal fails, he emphasized that the ballot measure is “not threatening” services.

“When we put this tax forward to the residents, this is not a threat that if we don’t get this, we’re going to have to cut services,” he said. “The previous administration said: ‘Well, either give us this money or we’re going to cut services.’ This is not that kind of a statement. We’re merely saying the city has been supported by sales taxes. Every sister city has gone into the sales and retail business. We’re in competition for shoppers. And our income is substantially down.

“So we either start putting a little more money into our city or we’re going to have to look hard at what we can provide. So, we’re not threatening. But we’re going to have to put everything under a microscope. I think nothing is going to be sacred,” Foote added.

The Board of Aldermen was slated to vote Tuesday night — after the Call went to press — on whether to place that tax-rate increase on the city’s Aug. 5 ballot.

If approved, the measure would tax residents an additional 35 cents per $100 of assessed valuation and generate an estimated $1,130,528 per year. Residents already pay a combined 37.4 cents per $100 of assessed valuation through the city’s municipal tax and 2006 Proposition S tax. If the 35-cent tax-rate increase is approved, residents would pay a total tax rate of 72.4 cents until 2012, when Prop S expires.

A comparison of tax rates among nearby cities shows that Glendale is 45.5 cents, Rock Hill is 55 cents, Kirkwood is 65.1 cents, Richmond Heights is 69.6 cents and Webster Groves is 80.4 cents. While Sunset Hills’ municipal tax rate is 5.4 cents, its residents also have to pay for fire protection through either Mehlville’s 55.9-cent rate or Fenton’s 62-cent rate.

But while Sunset Hills residents now pay for fire protection through another district, Foote and Mayor Roy Robinson both emphasized last week that Crestwood officials hold the city’s emergency services in the highest regard.

“Our Fire Department is one of the reasons why we existed,” Foote said. “If we went into the Mehlville district or some other place, we’ll lose total control over any increases that go in to support our Fire Department. Our Fire Department is doing an outstanding job. There are many other areas in our city services that are doing outstanding jobs. But some are more important than others. And when it gets right down to it, there are core services that we signed up to provide and we’re going to have to provide some of those fringes.”

Robinson agreed and said, “The safety of this community, whether it’s fire or police, there’s nothing more important than that. I love our parks and I love our public works and public services. I love them, too. But when it comes to safety, there’s nothing like it. And I don’t want to live amongst a bunch of thugs like I’ve told you before.

“That’s what comes in when you don’t have adequate police protection. And I don’t want people burning up because there was a 20-minute response instead of the two-and-a-half or three-minute response that we get today. I think when you stop and think about how good this safety part of our city is, there’s nothing like it. And we’d better ensure that we protect the people in this community because you don’t have a community without safety.”

Ward 3 Alderman Gregg Roby and Foote said that with continual drops in sales-tax revenue and expected drops in property-tax revenue, they are worried that a 35-cent tax-rate increase still would not be enough to maintain existing city services.

Roby estimated that based on a modified-accrual accounting basis and trends from the first four months of 2008, the city will end the year $917,080 below budget in sales-tax revenues.

With the proposed 35-cent tax increase projected now to bring in just more than $1.1 million per year, Roby is concerned that if sales-tax revenues drop at a steeper rate and if property-tax revenue also falls, that extra revenue from a tax-rate increase would fall short.

Foote agreed, adding that with the pending redevelopment of the Crestwood mall and an uncertain economy, he and city officials are “not able to predict how bad it’s going to be.”

“Thirty-five cents is $1,130,528 (per year),” Foote said. “I frankly don’t think even with that increase we’re going to be able to cover what we need to cover. So I have to agree with Gregg Roby that there is going to have to be a very strong look at our costs. Painful as it is, we’re really going to have to look at it and come to the reality that until our sales taxes can support us, we’re going to have to get by on this $1,130,000 … So I don’t think anything’s going to be sacred on the budget. It’s a question of trying to survive.”

“… In 2009, is it going to get better? Is it going to get worse? We don’t know. But if you take the same fall that we experienced between 2006 and 2007 and what we seem to be experiencing currently in our fiscal year, by 2009 if we don’t get a patch on it of some sort, we’re going to be in over our heads … And if we don’t give the residents a chance to vote on this, I think we’re absolutely going to be betraying them.

“They need to vote on the increase that’s put forward. If they elect to move forward with it as we’ve suggested, that’s their prerogative. They may do so. If they don’t think our reasons are strong enough, they may reject it. That’s all right. But for this board not to move forward and give the residents a vote, that’s wrong.”