Tax revenue, jobs, both down
Springfield city officials blame the state and the internet for sagging municipal finances.
Online
purchasing, which produces no municipal sales taxes, has cut into tax
collections, the city says. And the state last summer installed a fee
for collecting the city’s portion of income taxes.
“There are two main problems:
Consumer
behavior and state action, neither of which we can control,” city
budget director Bill McCarty told the city council during a September
budget briefing. The budget deficit could rise as high as $11.5 million,
McCarty and Mayor Jim Langfelder warn as the city council prepares to
consider cuts and tax increases to balance next year’s budget.
The city largely has been silent on another truth. Employment in the Springfield area has fallen.
Through
October, the Springfield area ranked sixth nationally in the number of
jobs lost in 2017, according to a recent report from 24/7 Wall Street,
an online business website, published last month in USA Today. With
a loss of 2,518 jobs in the first 10 months of 2017, it amounts to an
annual loss of $117.5 million in wages, based on the area’s average
salary of $46,650 as calculated by the U.S. Bureau of Labor Statistics.
Langfelder
pointed out that the metropolitan area includes Menard County,
unincorporated parts of Sangamon County and municipalities other than
Springfield. Still, the number of jobs in the city has fallen by 400,
acknowledged the mayor, citing a recent state report.
Langfelder foresees great days in the near future.
“I’ve
been around Springfield all my life,” Langfelder said after Tuesday’s
city council meeting. “We’re on a positive path. Unfortunately,
sometimes, people, you have those naysayers.”
Langfelder
during the council meeting read a proclamation declaring 2018 to be a
year of optimism. “We as a community can change attitudes and direction
by turning negative mindsets into optimistic ones,” the mayor declared
as he read from the prepared proclamation.
Langfelder’s
optimistic streak comes as Sangamon County pushes for the creation of
an economic development corporation tasked with drawing new businesses
and jobs to Springfield. The mayor’s rosy picture is in stark contrast
to a consultant’s report released in October by the county, which has
committed $500,000 for the creation of an EDC. The consultant reported
that Springfield hasn’t done enough to lure new businesses and jobs and
that city discourages innovation and new ideas.
“We’re
losing population,” said Sangamon County administrator Brian McFadden.
“We’re losing jobs. Wages are stagnant. We’ve put all our eggs into two
baskets, state government and the medical district. … At this point, I
don’t see how the city doesn’t participate in the economic development
corporation at some level or another.”
Langfelder isn’t a fan of the county’s report.
“You
don’t want to say, like Eeyore, ‘Oh, woe is me, the sky’s falling,’”
Langfelder said. “That’s why the city hasn’t grown, is because of that
negative attitude over a decade. That’s what the report really says, the
same-o-same-o, woe is me. What we’re trying to change is that
attitude.”
The county
wants the city to commit $500,000 to creating an economic development
corporation, but Langfelder has resisted. The mayor questions the need
to spend so much money and suggests that the existing regional planning
commission could be altered to include economic development functions.
The city, the mayor insists, is doing just fine, with such projects as a
$20 million expansion at Levi, Ray and Shoup and a $50 million
construction project by St. John’s Hospital demonstrating the city’s
economic vitality.
What
about the recent announcement that H.D. Smith, which employs more than
300 people, has been sold to an out-of-state company?
“The verdict’s out on that,” Langfelder answered. Better times, he predicted, will arrive within a year.
“You’ll
see it in the upcoming year – you’ll see the strengths of the city,”
the mayor said. “We’re heading in the right direction.”
Contact Bruce Rushton at [email protected].
