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Council adopts deficit budget in Sterling

Garbage, sewer hikes approved

STERLING – Pensions continue to take their toll on city finances, as the council Monday passed a fiscal year 2014-15 budget estimating a deficit of $550,398.20.

The police and fire pension funds now constitute 35 percent of the city’s levy distribution, City Manager Scott Shumard said.

“It’s not that we aren’t putting money in those funds. It’s just rising so fast, you can’t keep up,” Shumard said. “We can look for a large increase again next year in the fire and police funds.”

The budget shows total revenue of $28,312,441, and total expenditures of $28,862,839. The general fund was in the red by $65,590.

The pension expenses were $1,232,279 for the fire fund, and $966,360 for the police fund.

Slow growth on the revenue side also played a role, Shumard said during a budget hearing held before the vote.

“Sales tax projections were up only 1.1 percent, and income tax increases 2.1 percent,” Shumard said. “Then you factor in an expected 2.18 percent decline in EAV for Whiteside County.”

A wild card still exists with ongoing police and fire labor negotiations. The police union contract expired April 30, 2013. Negotiations broke down early in the process, and a federal arbitrator is scheduled to come in May 14. Because those are public safety jobs, the existing contract is automatically extended until a new agreement is reached.

The fire union pact will expire April 30. The first negotiating session was Feb. 13, with no others scheduled. Police and fire contracts have been renegotiated every 3 years.

In other action, the council approved increases for sewer and garbage services.

The monthly garbage collection rate will increase from $15.10 to $15.30. The bump was needed to cover the increase negotiated in the city’s agreement with service provider Allied Waste. That increase is actually 27 cents, prompting Mayor Skip Lee to question the amount.

“If the contract calls for an additional 27 cents, should we be going for 27 cents instead of 20 cents?” he asked Shumard.

Shumard said they would be able to cover it with the 20-cent increase.

Three of the sewer line items will increase. The minimum basic user rate for sewer service will jump from $5.10 to $5.35. The basic user rate per 100 cubic feet will increase from $1.57 to $1.82. The minimum total charge, now at $8.10, will jump to $8.35. The debt service charges will not increase.

The city has been raising sewer rates in smaller increments over a longer period of time in preparation for building a new sewer plant. The replacement time on the older facility depends largely on future EPA mandates.

“We have a lagoon-style plant, and the technological shelf life could be up soon,” Lee said.

Lee said he uses the example of Rock Falls to illustrate why it is important to plan ahead for such a big expense.

“We started putting money away for this project 6 years ago,” Lee said. “We need to be prepared for an emergency, and I think smaller increases are better than giving people a huge increase all at once.”

The city has about $10.4 million set aside for the sewer plant project estimated to cost between $20 million and $30 million.

Next meeting

The Sterling City Council next meets at 6:30 p.m. May 5, at City Hall, 212 Third Ave., on the first floor in the Council Chambers.

Go to or call City Hall at 815-632-6621 for an agenda or more information.

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