Tag Archives: Peoria Riverfront Museum

Museum Block, Peoria County

County re-crunches museum numbers

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Earlier this month, Peoria County administrators crunched the pro forma numbers submitted by the Museum Collaboration Group and found that it was a money-losing proposition. The museum folks objected to that analysis, saying it wasn’t accurate. They got together with the County and re-crunched the numbers, and now the County shows the museum will make a tidy profit.

Erik Bush, the County’s Chief Financial Officer explains what changed:

The first analysis actually showed a dire projection. When discussing the revenues with PRM staff, it became clear that in developing their background materials, PRM had established discounts on their revenue projections, from which I assumed as 100% projections. In reality, these numbers were in some cases 70% of their true projections. In tum, I was discounting discounted figures. A line by line narrative of these changes may be found at the end of this memorandum.

I asked PRM to provide me with the 100% revenue estimates and proceeded to run the second iteration.

The results are summarized as follows:

a. Based on the PRM’s assumptions, their projections could be off up to 9% and still operate in the black over a 20-year period.

b. In using their 100% revenue projections it appears revenues annually meet or exceed 100% of expense projections. The margin of actual to budget has historically been 1-2%; therefore, I find a 9% cushion to a structural deficit reasonable.

c. A key item missing from their pro-forma is the cost of future capital investment. A common benchmark for capital investment is 10%. Based on an expected expense base of slightly more than $4 million, it can be reasonably expected the museum is not showing close to $400,000 in potential annual future costs to properly maintain its assets. This figure is a benchmark and can be driven by annual needs.

d. In the 100% scenario, roughly $100k of the endowment will be necessary to cover the cost of capital investment and break even annually. In the 95% scenario, an endowment ofroughly eight million dollars would be needed to generate the necessary interest (assuming 4% annual return, compounded monthly) to cover the annual cost of capital investment, combined with the projected excess of revenues over expenditures.

The changes are all well-argued, but I still have a problem with a couple of key assumptions:

  • Gallery admissions still based on projected 240,000 visitors per year. On their pro forma, the museum changed some parameters: they raised the average ticket price from $5.25 to $7.50, and they assumed 40% of the 240,000 visitors to the museum would buy a gallery admission, up from 33%. Those changes raised their projected revenue for gallery admissions from $420,000 to $718,000. However, if we use a more realistic estimate of 180,000 visitors per year, the revenue would be $540,000 — $178,000 less than the county/museum projection.

  • Planetarium tickets and attendance projected to go up. I’m stumped as to how the museum folks think they’re going to raise the admission price for the planetarium from $1.50 to $4.00 per student, yet end up having more students (19,000 vs. 16,000) visiting the planetarium, especially with schools in as bad of financial shape as they are these days. Nowhere do they explain how they came up with their number of students or how their number compares with historical attendance numbers. In my opinion, they have to assume at the very least that the number of students won’t increase. So take 16,000 students times $4 and you get $64,000, $12,000 less than the county/museum projection.

So, that’s a total difference of $190,000 from the proposed pro-forma, which would bring their projected revenues down to $4,298,000. That would still cover their projected expenses, but would only give them about a 4% cushion instead of 9%. Also, it would mean they’d have to use roughly $270,000 of their endowment for capital investment instead of $100,000. I don’t know how big of an endowment that would require, but to get $303,750 interest earned takes $6,750,000 of investable funds according to the previous pro-forma analysis available at the county’s website. Do they have that much in their endowment?

Here’s the other thing. The money raised by a county sales tax would have to go toward capital purchases, according to the statute:

For the purposes of this Section, “public facilities purposes” includes, but is not limited to, the acquisition, development, construction, reconstruction, rehabilitation, improvement, financing, architectural planning, and installation of capital facilities consisting of buildings, structures, and durable equipment and for the acquisition and improvement of real property and interest in real property required, or expected to be required, in connection with the public facilities, for use by the county for the furnishing of governmental services to its citizens, including but not limited to museums and nursing homes.

If the museum doesn’t meet their revenue projections, I think it’s logical to expect them to scrap the capital investment fund, especially since they didn’t have it in their pro forma in the first place. Without infusions of capital, the place will get out of date pretty fast, and then you know what will happen? They’ll be back asking the taxpayers for more county tax money under this statute for “durable equipment” and “improvement[s].” And then the taxpayers will really be over a barrel because the project at that point will be “too big to fail,” if you know what I mean.

I still believe that a more compact, urban design would be significantly less expensive to build while still being an attractive civic building, plus it would free up the rest of the block (outside of Caterpillar’s visitor center, of course) for private development (retail, residential components), which will bring in property and sales tax dollars to the city and county. Plus, it would be what the public said they wanted on that block, and what professional city planners over the past several decades have said is needed on that block. Why is this option not being pursued?

County board member Merle Widmer has written extensively on the topic of the museum. I encourage everyone who’s interested in this topic to take a look at his blog, Peoria Watch.

The county votes tonight (County Board Room 403, 6:00 p.m.) on whether to put a sales tax referendum on the April ballot. No other counties of which I’m aware are planning similar measures to support this “regional” museum.

Museum Block

The Economist: Museums “unsafe bets for urban renewal”

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A special edition of The Economist magazine (“The World in 2009”) includes this article, which was alluded to in a previous comment. The article is titled, “The Museum-building binge.” Here’s something to consider when deciding how much money and land we want to dedicate to a new downtown museum complex:

Museums often enjoy cheeringly high visitor numbers in the first year or two, but then attendance tends to taper off.

“Sustainability is the new buzzword,” explains Javier Pes, editor of Museum Practice, a journal published by the Museums Association. Wealthy private donors have been happy enough to contribute large sums in exchange for a glamorous new wing named after them. But donations tend to ebb after the museum reopens, and directors need to find other ways to pull in tourists after the initial excitement wears off, such as pricey blockbuster shows. Operating costs go up.

In Denver, for example, where Daniel Libeskind designed a new $110m building for the art museum, an initial boom of visitors in 2006 has waned, and budget constraints have forced the museum to cut staff. The remarkable new structure—an explosion of angles and intersecting shapes—is the centrepiece of Denver’s nascent culture district. Yet some visitors complain of feeling disoriented inside. […]

Such investments are clearly unsafe bets for urban renewal.

What is the Museum Collaboration Group’s plan to sustain their optimistic attendance numbers over the next 20 years (i.e., the duration of the bonds used for construction) and beyond?

Museum Block

Johnson: Attendance projections “not simply pulled out of the air”

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The following is a response to my post, “Questioning museum attendance projections.” It’s such a good response, I couldn’t let it be buried in the comments section of an old post, so I’m reprinting it here in its entirety. It’s a response from Mark Johnson, Caterpillar Experience project manager, who has been involved with the museum project for quite some time. Whatever you think of Mr. Johnson’s argument, you have to give him credit for his honesty and civility. I wish all debates would be this cordial and on-point. My thanks to Mr. Johnson for responding and to frequent commenter Ileriet for forwarding it to me.

An acquaintance advised me that you’d posted some critical analysis of the attendance projections for the new Museum and the Caterpillar Experience. Since I’ve been very involved in the development of those numbers, I thought perhaps that some additional info might be beneficial for your continued evaluation. I don’t expect that this info will eliminate your skepticism, but as this aspect of the project continues to receive significant focus, I’d like to attempt to explain some of the rational behind the numbers.

First, I’m glad you understand the 1/3 – 1/3 – 1/3 breakdown of the total attendance figure of 360,000. This does immediately get confusing, but it means that we recognize that not everyone who visits the site will visit both facilities. Therefore we’re talking about each facility having an annual attendance figure of 240,000.

Let’s focus on the Caterpillar Experience first as that’s my primary responsibility. Here we’ve used the John Deere Pavilion in Moline as our primary benchmark. For the first five years after the facility opened in August of 1997, it averaged 228,000 visitors annually. Attendance has declined over the past five years however, averaging only 176,000 per year. I think this shows that without continued investment in updating exhibits and displays any facility such as this will experience attendance declines. We believe that the exhibits and displays planned for the Caterpillar Experience, along with the significant focus on educational aspects of the facility, and the commitment to update the exhibits and displays within the facilty, should allow the Experience to attract and maintain an average annual attendance of 240,000 visitors per year.

For instance, we plan to work with instructors from the Caterpillar University to develop a potential course curriculum for middle school, high school and college students who are visiting the Experience on an organized tour. If time permits, their instructor will be able to select a grade level appropriate topic from the curriculum and the group could then extend their visit after the normal tour with this additional class. We’re hopeful that this concept will make the Experience an even more attractive field trip for area educators and continue to bring them to the facility year after year.

Most of the customers that our dealers bring to the Peoria area to visit Caterpillar facilities have free time from the end of first shift operations at the factories (about 3pm) until they go to their evening meal. Again, we hope that the dealers will find the displays and exhibits at the Experience very appealing and bring their customer tour groups to visit the Experience during this period of free time in the late afternoon. I suspect you can guess where many of these guests in Peoria spend most of that time currently.

Attendance projections for the Caterpillar Experience however, should really not be a controversy in regard to the overall project, as the company will be paying for the operation of the facility and if attendance projections are not achieved, it will be at no expense to the general public. So, lets look at some of the museum attendance projections in more detail. I’ve worked with the museum planners and their consultants on these numbers, including various revisions, several times over the past four years. We’ve scrubbed these numbers over and over until we’ve concluded that they are “reasonably achieveable”. Guaranteed, certainly not; a stretch, most probably; will achieving them require significantly more aggressive advertising and promotion than Lakeview currently utilizes, absolutely.

OK, here goes, again we’re looking at an annual attendance projection of 240,000 visitors or an average of 667 per day and in response to some of the inquiries you’ve received, yes, that includes every visitor to the facility (with the exception of those pre-school students that are enrolled in the facilities day-care program which will be a carry over from the current program operated at Lakeview Museum).

As I understand their projections, those 240,000 visitors have been broken down into five sub-categories as follows:

  • Exhibit Galleries & Planetarium only
    (56,000 annually or an average of 156 per day)
    (The general admission ticket will include admission to both the
    exhibit galleries and one show in the planetarium).

  • Exhibit Galleries & Planetarium & IMAX theater combination ticket
    (53,000 annually or an average of 147 per day)

  • IMAX Theater only
    (93,000 annually or an average of 258 per day)

  • Planetarium only
    (19,000 annually or an average of 119 per day)
    (this would primarily be school tours so I’ve assumed 160 days of school –
    throw out the first 20 days while teachers are getting organized).

  • all other visitors
    (19,000 annually or an average of 53 per day)
    (this would primarily be museum classes and special events, exhibit openings,
    special fund raising events, visitors to the museum store or book
    court)

With this breakdown, it becomes apparent that the IMAX theater is projected to be the primary generator of attendance at the Museum facility. The closest IMAX theater facility to Peoria is at the Putnam Museum in Davenport. Their attendance figures were the primary benchmark taken into account when the PRM numbers were developed. The four-year average attendance figures at the Putnam’s IMAX theater were 97,000 during the day and 73,100 during the evening or a total of just over 170,000. From the above figures, you can see that the museum planners are projecting 146,000 for annual attendance at the PRM IMAX or 86% of the Putnam’s history. When these numbers were originally put together, this was assumed to be a conservative projection for the PRM and was accepted as reasonable.

If you’ve been to visit the Putnam Museum in Davenport, I’d hope you’d agree that it is not located in a very attractive, nor conveniently located area of the community. The PRM’s location on the riverfront should generate much greater visibility to the Museum’s IMAX and boost attendance figures. Being relatively close to the downtown hotels and guests in town overnight for Civic Center events should also provide a boost to IMAX attendance figures. (To the best of my knowledge, negotiations with IMAX are still continuing on a positive track and museum planners have every intention of this large screen theater bearing the IMAX label).

Also, again referencing back to the Caterpillar dealer and customer guests in Peoria. We’ve talked to the Museum planners about the possibility of showing the IMAX film “The Fires of Kuwait” each afternoon during the week at about 4:00 or so, at a somewhat expected slack time at the museum after the school age tour groups have left for the day. This film is a very interesting documentary on the efforts to extinguish the oil well fires in Kuwait after the first gulf war and features the extensive use of Caterpillar equipment in very hazardous conditions. Again, we’d expect that many of the dealer and customer guests would be interested in watching this movie during that normally free time. It would certainly be a unique opportunity for them during their visit to Peoria.

Looking at this IMAX attendance projection on a daily basis breakdowns down to approximately 400 per day. With four shows planned during the day and two shows in the evening, that would require an average of about 68 people per show, or about one large school bus per show with a few others joining them. Reasonable or unreasonable, to each his own opinion, but the Museum planners have set this as their target.

Another way to analyze the data would be to combine the 56,000 figure for the Gallery/Planetarium only visits with the 53,000 figure for the Gallery/Planetarium/IMAX visits which would result in a total of 109,000 visitors to the galleries each year or a total of just over 300 visitors per day. And yes, this projection counts every student who tours the exhibit galleries at the museum with his class on a field trip. Obviously the museum planners feel these numbers are reasonable and achievable, skeptics will look at them as overly optimistic and most likely unobtainable. However, doesn’t the JFK quote go something like, “Some men see things as they are and ask why, others dream of what might be and ask why not?” Perhaps that’s appropriate in this situation.

There are pages and pages of other benchmarking data to substantiate all of these numbers, however I don’t have the time or space to cover everything individually. My intent in sharing these numbers with you is to simply demonstrate that they were not simply pulled out of the air in an effort to make the project look attractive. I suspect that some of your fellow bloggers will recall the old phrase, “Liars figure and figures lie” However, from my perspective, one of the primary objectives of the “Build the Block” campaign has been to share information about the project with the public in order to allow them to better understand the proposed development and I hope this information contributes to that understanding.

Mark L. Johnson
Project Manager – Caterpillar Experience

Museum Block

Questioning museum attendance projections

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Reading over the Peoria Riverfront Museum information on the County’s website, I found page 211 especially fascinating. There, in black and white, is a “Museum Benchmark Matrix” comparing various museums around the country, their square footage, metropolitan statistical area (MSA) population, annual attendance figures, and other information.

Here is a simplified chart of all the museums that listed their annual attendance figures (I’ve added Peoria’s proposed museum to the end of the list):

Museum Location MSA Pop. Gross SF Annual Attendance
Science Station Cedar Rapids, IA 252,784 20,000 27,000
Science Spectrum Lubbock, TX 267,211 85,000 185,000
Putnam Museum Davenport, IA 376,160 115,000 190,000
Sci-Port Discovery Center Shreveport, LA 387,583 92,000 200,000
Gulf Coast Exploreum Mobile, AL 404,406 55,000 220,000
Exploration Place Wichita, KS 596,452 100,000 180,000
Louisville Science Center Louisville, KY 1,233,735 129,000 315,000
Kalamazoo Valley Museum Kalamazoo, MI 323,264 60,000 125,000
Peoria Riverfront Museum Peoria, IL 371,206 81,000 240,000 (est.)

Notice anything unusual or surprising? That’s right. The projected attendance for Peoria’s museum block is more than every other museum in the matrix, except for Louisville’s, where the MSA is over 1.2 million people.

In case you’re wondering where I got the 240,000 figure for attendance, here’s the scoop: the museum folks are estimating 360,000 visitors per year for the whole block. But they split that up this way: 1/3 of those people will attend Caterpillar Experience only, 1/3 will attend the Peoria Riverfront Museum only, and 1/3 will attend both. That means that only 2/3 of the 360,000 estimated visitors to “the block” will go to the Peoria Riverfront Museum (360,000 x 2/3 = 240,000).

It’s tricky trying to figure out their numbers, as you can see, because they often treat the whole block as a single project in their campaign literature. But it’s really two projects; and if you want to compare apples with apples regarding the museum, you must first split the projects apart.

So let’s see if Peoria’s numbers hold up to some mathematical scrutiny. Let’s look at market penetration. We’ll take the average attendance and divide it by the MSA population for each of the museums listed in the matrix:

Museum Att./Pop.
Science Station 10.7%
Science Spectrum 69.2%
Putnam Museum 50.5%
Sci-Port Discovery Center 51.6%
Gulf Coast Exploreum 54.4%
Exploration Place 30.2%
Louisville Science Center 25.5%
Kalamazoo Valley Museum 38.7%
Average 41.35%
Peoria Riverfront Museum 64.7%

As you can see, the projections for Peoria’s museum are well above the average of other museums in the matrix. If Peoria were to get the 41.35% average penetration, it would come out to about 153,494 visitors per year.

Now, I’m going to guess that the argument will be that these are old numbers — possibly as old as 2004 — and that the museum’s projected attendance figures are for 2011, which is the date they hope to open the museum. So, let’s assume that 153,494 is a 2004 figure, and that attendance would increase at a rate of 3% per year. Over seven years (2004-2011), that would bump up the attendance to 188,788 visitors — still far below the 240,000 figure being projected. To get to 240,000, you’d have to assume that attendance would grow by almost 7% each year. It’s also worth noting that museum officials have been projecting “200,000 to 250,000 visitors a year” since 2003 (“Report touts museum impact,” Peoria Journal Star, 4/8/2003).

Granted, my methods are not nearly as scientific as the “common sense” methods employed by others, but I think a case could be made that the museum’s attendance estimates are wildly optimistic.

Museum Block, Peoria County

Sales tax referendum discussed at county finance committee meeting

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I couldn’t attend the Peoria County finance committee meeting Tuesday, but activist and regular commenter Karrie Alms did and provides this scoop:

Today’s Peoria County Finance Meeting was a real treat of new information.

  1. Peoria County feels that they will need to get the City of Peoria to title the museum property to them so that the County will be able to legally issue revenue bonds for the museum project. So, the County is in the process of carrying that water to the city.

  2. Roughly $35M will be needed for the museum project. Roughly — not a firm figure. Is that an increase, decrease or the same amount from the last figure on record? Wonder when that figure will be firmed up?

  3. That the resolution (the referendum language) will refer to a “public facility” not the museum specifically.

    I asked that as a voter in the voting booth, how would I know that the money would be specifically used for the museum? I wouldn’t know and that the museum people will have to make their appeal to let the voter know that the money is for the museum. Special, seeing that PA 95-1002 (born as SB 1290) refers to public facilities. I guess we will just vote to pass another tax for the County to start a fund for whatever suits them.

  4. And my favorite, that once the county has repaid the bonds, that the county could just give the land away to anyone — the city, the museum group or whomever. This concept was repeated at least twice.

After the bonds are paid off, Karrie told me, the County would then transfer title to the property back to the City or possibly the museum directly. I believe it was said in the meeting that it didn’t matter which entity got the property.

It’s interesting to me that they’re planning to use revenue bonds. What revenue will this project be producing exactly? Just a couple weeks ago, the city decided against using revenue bonds to pay for the new Marriott hotel downtown, opting for general obligation bonds because there was no established revenue stream. Now the county will be using revenue bonds for a project that will most likely need a perpetual operating subsidy? Where’s my municipal bond expert commenter? I need some more explanation on this one.

In answer to Karrie’s second question, the number was $24 million in November 2007 when it was first pitched to the county. By November 2008, the number reported was $35 million, evidently due to increased construction costs.

As for the referendum language, it is certainly vague if they’re indeed going to ask for a tax to go for a “public facility” without specifying said facility. They could use that money for anything, including other facilities besides the museum if the tax raised a surplus of money.

One other interesting note that Karrie didn’t mention: the results of the online survey were quite a bit more negative than the phone survey. On all the questions, a rather large majority was opposed to a sales tax increase regardless of the reason.

Museum Block, Nation/World, Peoria County

Did anybody not see this coming?

17 Comments

From today’s Journal Star:

Museum backers hope the federal economic stimulus plan includes $4 million to construct an underground parking garage for the Downtown project.

Of course they do. Especially with Mr. LaHood as Secretary of Transportation, they probably feel pretty confident they’ll get that money, too. Nevermind the fact that we don’t need any additional parking for this project. Nevermind the fact that they haven’t raised their goal in private or public funding, indicating that there is not sufficient local support for this project. The latest spin on the project is to call it a “stimulus project,” designed to stimulate the local economy:

[Brad] McMillan said an agreement with museum representatives and Caterpillar – which wants to construct a $41 million visitors center next to the Downtown museum – said “100 percent” of jobs generated from the construction of the facility would come from “local construction” and trades.

“This could mean a lot of work during a tough economic time span,” McMillan said.

In order for the project to go forward, of course, Peoria residents would have to approve a .25% increase in the local sales tax. So, you see, a higher sales tax will be a good thing for the economy, because it will create 250 construction jobs. Let’s see, $24,000,000 in higher sales taxes, plus $4,000,000 in federal stimulus money, that’s $28 million for 250 jobs, or $112,000 per job.

So now, not only is this project an exercise in inefficient land use, it can also be poster child for inefficient use of public funds.

City Council, City of Peoria, Museum Block

Manning pulls no punches with museum

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The political pressure is off of Bob Manning, Third District Councilman. Since he’s not running for reelection, he can tell us how he really feels, and he pulls no punches in doing so. Take a listen to his comments about extending the redevelopment agreement for the old Sears block. This is the third time the museum folks have asked for the deadlines to be extended:

[audio:http://www.peoriachronicle.com/wp-content/uploads/Audio/Manning-12092008_64K.mp3]

After Manning’s speech, several other council members spoke to the issue, then voted 9-1 to approve the deadline extension until June 2009. Manning was the lone dissenting vote; Turner abstained, and Sandberg was absent from the meeting.

Kudos to Bob for his incisive analysis, which just happens to be exactly what I’ve been saying about the museum project for some time now. 🙂

City of Peoria, Museum Block

Peoria deserves great places, not dead spaces

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I’ve been reading a book by James Howard Kunstler called “The Geography of Nowhere.” Great book — you should pick it up. It was written in 1993, so I looked online for some more recent talks he’s given, and found this one (warning: contains some strong language). In that talk, he made a great observation that should be obvious to all of us: people like to inhabit great places. He shows this graphic as an example:

He explains:

It’s a good public space. It’s a place worth caring about. It’s well-defined. It is emphatically an outdoor public room. It has something that is terribly important. It has what’s called an active and permeable membrane around the edge. That’s a fancy way of saying it’s got shops, bars, bistros, destinations. Things go in and out of it — it’s permeable. The beer goes in and out, the waitresses go in and out. And that activates the center of this place and makes it a place that people want to hang out in. You know, in these places in other cultures, people just go there voluntarily because they like them. We don’t have to have a craft fair here to get people to come here. You know, you don’t have to have a Kwanzaa festival. People just go because it’s pleasurable to be there.

This should be common sense, but we’ve become so accustomed to poor public spaces that we don’t even notice them anymore. We have been conditioned to expect and accept mediocrity.

Consider some of Peoria’s public spaces: Riverfront Village, Festival Park, the area around the Civic Center. These are not places where people want to hang out. It’s not pleasurable to be in these spaces. The best the city can do is have the Park District “program” the space with festivals, carnivals, and other things that entice people to come down and visit. But go down there when there’s no program, and the space is vacant. There’s a reason for that: nobody wants to be there.

And that’s what’s wrong with this proposed public space, too:

To borrow a line from Kunstler, there’s not enough Prozac in the world to make a person feel good about being in this space. Ask yourself, honestly, if this is a place you would want to hang out with your friends. Yet, as you can see from the bird’s-eye view picture, the designers have provided ample open space for you to (theoretically) congregate. But the sad truth is that nobody wants to drive downtown (too bad they can’t live here) with their sack lunch (because there are no cafes) and stand around on a big concrete slab (because there’s no shade or bench) between two collections of blank metal walls (that have no retail draw). Museum backers tacitly admit that no one will want to come to this space, because their plan to attract people revolves totally around programming, just like Festival Park and the rest of the riverfront. There is no “active and permeable membrane around the edge” of this proposed development. And so, if it’s built, it will look just like this artist’s rendering: empty, stark, colorless, vacant, and depressing.

This would be a travesty if it were built at all, but the prospect of it being built with public funds is unconscionable. Peoria doesn’t need another tax-subsidized dead space downtown. We have enough of them. Peoria needs great places. And if taxpayers are going to contribute to a project, they deserve to get a great place for their money. If the museum folks want our tax money, they are obligated to provide something a whole lot better than what they’ve proposed. Peoria residents should demand it.

Museum Block, Peoria County

Parade used for a little museum promotion

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The Museum Collaboration Group doesn’t miss a single opportunity to advertise. Here they are at the 121st annual Santa Claus Parade with a banner and some little foam blocks for the kiddies.

I’m surprised the blocks didn’t have “Vote Yes!” preprinted on the other side, in anticipation of the sales tax referendum that’s due to hit our ballots in April. Perhaps they decided that would be too presumptuous, since the county board hasn’t approved the ballot question yet.

Museum Block, Peoria County, State Legislation, State of Illinois, Taxes

Who’s afraid of the big bad economy? Not the museum!

10 Comments

From the Journal Star:

With little debate, the Illinois Senate today voted 51-4 to send Gov. Rod Blagojevich a proposal to let Peoria County ask voters to OK a special sales tax to help pay for the Peoria riverfront museum.

The legislation, Senate Bill 1290, passed earlier in the House of Representatives. With Blagojevich’s signature, it would become law, and the question could be put to voters in the February or April municipal elections.

Not mentioned in the article is the fact that the bill allows increases in 1/4% increments, and could be used toward any “public facility” (e.g., Belwood Nursing Home), not just the museum. The way it will likely read on the ballot is:

To pay for public facility purposes, shall Peoria County be authorized to impose an increase on its share of local sales taxes by .25% (.0025) for a period not to exceed (insert number of years)?

This would mean that a consumer would pay an additional 25¢ ($0.25) in sales tax for every $100 of tangible personal property bought at retail. If imposed, the additional tax would cease being collected at the end of (insert number of years), if not terminated earlier by a vote of the county board.”

A quarter of a percent increase doesn’t sound like a whole lot, does it? But consider that, if this referendum were to pass, you would be paying .25% more on things that already are highly taxed — like restaurant food (which would go from 10% to 10.25% in the city). Is that going to make Peoria more or less competitive than East Peoria, right across the river? How many people do you think will come to see the museum in Peoria, then go have lunch in East Peoria?

And what about the economy? Is this the time to be increasing taxes when there’s plenty of unemployed people? What is the city’s solution on how to decrease the unemployment rate?
Consider these other items in the news as of late:

  • “[T]he effects of the economic crisis are being felt beyond Wall Street as charities locally and nationwide report increases in basic needs and decreases in donations to provide those. Some of the people who used to be donors are now asking for donations…. Nearly 90 percent of Catholic Charities nationwide report more families seeking help, with senior citizens, the middle class and the working poor among those hit hardest by the downturn…. The Salvation Army already has seen between 15 percent and 20 percent more need than last year in its first week of assistance applications received for the holidays…. The Friendship House scaled back the number of families this year allowed into their Adopt-A-Family program to ensure they could fulfill the need.”
  • “Fiscal restraint was the guiding principle in crafting next year’s [Peoria] county budget, which represents a 6 percent overall decrease over last year’s budget. In what is being described as a ‘maintenance budget’ with no new taxes or fees and no spending cuts, preliminary figures show spending requests at nearly $122 million while the county expects to bring in about $119 million in revenues. The approximately $3 million deficit – mostly in the capital fund – will be covered by reserve funds that sit at nearly $74 million, said Erik Bush, Peoria County’s chief financial officer….. The county expects to collect $25.5 million from taxpayers, about $1 million more than what was collected in 2007. Although the tax rate will drop 1 cent to 81 cents per $100 assessed valuation, property values are projected to increase 5.4 percent, so homeowners actually will pay more taxes to the county. The owner of a $120,000 home, whose value increases the projected 5.4 percent will pay $341.50 in taxes to the county, or $13.50 more than last year.”
  • “In total, the city’s staff whittled a $2.2 million budget deficit down to $117,771, an amount that some council members praised. ‘We asked an unbelievable task of our staff,’ Mayor Jim Ardis said. ‘Without cutting any positions or having any tax increase.’ …Finance Director Jim Scroggins said the biggest savings comes from the city’s health care costs, reflected in a substantial difference between the 12 percent budgeted increase for 2008 and the actual increase in health-related costs of only 4 percent…. In addition, the city plans to scale back on parking deck repairs ($300,000), repairs to some of its buildings ($200,000), delay repairs to police headquarters ($25,000), and reduce the neighborhood signs program ($68,662).”
  • “Illinois’ backlog of unpaid bills has hit a record $4 billion, and Comptroller Dan Hynes said Thursday the situation is ‘potentially catastrophic’ if allowed to continue…. Earlier this week, Blagojevich’s office said state revenues will fall $800 million short of projections because of the recession. The Senate Democrats’ top budget person, Sen. Donne Trotter of Chicago, said borrowing money right now may not be a good idea because of interest costs. He said the state should tap into its ‘rainy day’ fund first. Hynes said money in the rainy day fund was used in July. Trotter’s Republican counterpart, Sen. Christine Radogno of Lemont, also didn’t think much of borrowing money. ‘That’s exactly what’s gotten us into this problem,’ Radogno said. ‘Continuing borrowing is not a good idea. They’re going to have to look at making cuts. The wiggle room is gone.'”

It’s time to use all that advertising money to come up with another plan — one that doesn’t involve raising taxes.


Museum Block, before it was turned into a temporary parking lot