Budget shortfalls in LSL

Arnold, MO

#1 Mar 21, 2009
Drop in property values may strain Lake Saint Louis budget
Aldermen consider giving back pay raises

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By Elizabeth Perry
Saturday, March 21, 2009 1:22 AM CDT

The drop in property values has left Lake Saint Louis officials scrambling to cut fat from a lean budget.

Despite an anticipated $86,000 shortfall, the Lake Saint Louis Board of Aldermen voted Monday not to raise property taxes.

Instead, aldermen will have to make departmental cuts, City Administrator Paul Markworth said. Markworth said he hopes they will not have to let employees go.

"That's the absolute last thing we want to do," Markworth said.

Lake Saint Louis experienced a 4.5 percent drop in assessed property values, Markworth said.

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During the meeting Monday, Markworth suggested a 2-cent increase in the property tax rate. As it stands, the rate is $0.5951 for every $100 assessed valuation for the general fund, Markworth said. The rate for the bond levee is roughly 40 cents for every $100 in assessed valuation.

That suggestion was met with universal displeasure from board members.

"I don't think it's the right thing to do right now," said Alderman John Pellerito, Ward 3.

Pellerito, who is running for mayor against current Mayor Michael Potter in the April 7 election, and Alderman Ralph Sidebottom, Ward 1, suggested cutting costs by limiting fuel consumption for city vehicles.

Alderman Michael Daniels, who is running for re-election in Ward 2, said if there was going to be a tax increase, it should be done before the election.

"It would only be fair," he said.

Daniels is running against Kathy Schweikert.

Alderwoman Charlotte Norton, Ward 2, suggested the board members give back a pay increase they received this year. The amount would be about $28,000.

"It would show good faith on our part, and I don't think any of us would go hungry," she said.

City Clerk Donna Daniel said returning the increase would not have an immediate impact on the budget shortfall. Any changes to aldermen's salaries would not go into effect until next term, she said.

Norton said she didn't realize this was the rule when she made the suggestion. The aldermen could donate the money to the city, but they would have to pay taxes on it, Norton said.

"I certainly would consider it, but I don't want to commit myself to it until I know the legal ramifications," Sidebottom said.

Sidebottom said the city's staff is looking into the legality of donating the pay raise amount and would report on it during the next board meeting.

"I don't want to try to do a good deed that ends up getting me in trouble," Sidebottom said.

Adding another wrinkle is the state of the city's streets.

"The city does not have the income at all to maintain the current streets," Norton said

Derek Koestel, director of public works, said soon the city won't be eligible for grants to repair streets. To compensate, the city needs to invest more in maintenance, Koestel said.

Ideally, Koestel said, in order to maintain streets he would budget about $2.3 million for asphalt and concrete.

"It's not going to happen," Koestel said.

Markworth said board discussions will take place in May but the final budget must be approved by July 1.

"It's way too early to start making hard and fast decisions," Sidebottom said.

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