Flood-control tax hike passes in Niles

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Updated: March 3, 2012 8:09AM

Shoppers will see an increase in the village of Niles’ sales tax starting in July.

The Board of Trustees voted 4-2 to increase the sales tax in the village from 1 percent to 1.25 percent.

The sales-tax increase is expected to generate about $2 million a year for the Niles Storm Water Relief Program, which will be used for capital stormwater improvements.

The village plans to borrow $15 million for the projects, for which work will be done in phases, Village Manager George Van Geem said. As part of the ordinance, if funding for the plan is completed within 20 years then the sales-tax increase will be rescinded.

Each year, any residual would go to the police- and fire-pension funds, where there is a $50 million underfunded liability.

Trustees Rosemary Palicki and Louella Preston voted against the tax hike.

Palicki said that putting leftover funds in the fire- and police-pension funds wasn’t enough. She said something more should be done to meet the village’s pension liability.

“There should be some sort of a guarantee,” said Palicki, adding that there should be more of a commitment from the board to fund pensions.

Palicki said she was concerned about the village taking on more debt than it can handle. She said it’s a double-pronged ordinance and that funding pensions is just as important as storm relief.

“Our citizens are suffering from flooding,” said Trustee Jim Hynes, who voted in favor of the sales-tax increase.

Trustee Joseph LoVerde said the board should approve the tax increase because residents deserve flood relief.

Preston said she could not support the increase because a specific stormwater-relief plan was not in place yet.

Preston said she could support the tax hike if the funds went to the general fund and the board could designate the money on an annual basis.

A public meeting to present final recommendations from the Storm Water Commission will be held in mid-March. At the March village-board meeting, project details, including capital projects and cost-sharing components, will be discussed.