Town’s financial policy eliminates debt
Dec. 30, 1999, was a big day for the town of Normal, Ill. That was the day that Normal, a community of 42,000, made its final payment on a bond debt of $12 million.
The town had instituted a policy of avoiding bonded indebtedness to finance major capital improvements in 1988. Over the next decade, Normal made a concentrated effort to liquidate its bonded indebtedness and followed a “pay-as-you-go” plan of funding major improvement projects with available cash.
The town used several revenue sources to achieve its debt-free status. In 1988, a 1/2 percent local sales tax was implemented. That was increased to 3/4 percent in 1995 and to 1 percent the next year. Additionally, revenues from a $5 monthly fee for garbage collection, a 4 percent tax on alcohol and revenue from a continual increase in assessed property valuation have been used to pay for capital improvement projects. During the same time, Normal maintained a consistent general fund levy and the lowest property tax rate of similar central Illinois communities.
Despite the frugal financial policy, the local government has increased its staff, provided additional services — such as a recycling program — and has sustained the infrastructure needs of continued growth. Additionally, it has built an aquatic center that includes a zero depth activity pool; six swim lanes; a plunge pool; waterslides; a diving area and two sand volleyball courts. It also has restored the historic Normal Theater; expanded softball fields with an eye toward hosting national tournaments; built a new police station and a new fire station; expanded the public library; and constructed a linear park for hiking and biking.
“After I sign this, we own everything,” said Mayor Kent Karraker as he signed the ceremonial check for the final bond payment. (Karraker had proposed the pay-as-you-go policy when he was a member of the town council.)