BLOOMINGTON - More taxes or fewer services could be in Bloomington residents' future. Aldermen debated Wednesday whether money to meet the city's budget needs could be found by cutting into city departments or raising taxes or fees.

The council met to discuss its budget priorities for the 2008-09 fiscal year, which will start May 1, 2008. Work to draft the city's roughly $75 million general fund will begin in the fall.

Increasing the city's garbage collection fee or levying a ticket fee for U.S. Cellular Coliseum were considered, but raising the city's sales tax by a quarter percentage point was hotly debated.

Discussion on the sales tax had added urgency because the deadline to make the change for 2008 is Oct. 1. That gives the council its Sept. 24 meeting to make a decision on that option.

By adding 25 cents to the cost of $100 in goods, the city could generate additional revenue of roughly $2.6 million.

Alderman John Hanson was among those who agreed a sales tax increase should be considered if the council wants to continue its program of improving the city's streets and increasing the police and fire departments.

"We need a revenue stream, and we need it because of our contractual obligations," Hanson said. "Those of us who were here a year ago promised a back-to-basics package to the taxpayers, but that is not going to happen."

Additional costs such as new state requirements for funding pensions for police officers and firefighters are adding to the city's budget problems.

Hanson was met by arguments from several aldermen, including Kevin Huette, who said the city can find the money in its already proposed $75 million budget by looking for efficiencies within the city's departments. Currently the proposed budget is $400,000 more than the estimated revenue for next year.

"Just like last year, we are going to have to suck it up a little bit," Huette said. "We should look at cutting our budget enough to cover 2 percent."

That amount likely would cover the projected losses for the U.S. Cellular Coliseum. It's expected to have a $1.6 million shortfall this budget year.

In countering Huette's comments, Hanson said if the city is looking to cut its budget, the council's work session on new street projects will be short.

"There won't be any money so that is going to leave us little to talk about," Hanson said.

Mayor Steve Stockton said more of the sales tax money likely will go toward many of the "back to basics" projects but he acknowledge the public will see it as a tax to bail out the Coliseum.

He suggested a $1 per ticket fee for events so those who use the Coliseum will be covering more of the estimated shortfall so more of the sales tax revenue can go toward the improvement projects.

Alderman Karen Schmidt highlighted the urgency behind the sales tax issue by arguing the city needs to come up with a plan to cover the budget expenses now before the city comes up short next year.

She suggested the city raise the sales tax for one year to ensure there was enough money and then the issue can be revisited. The increased rate must be filed with the Illinois Department of Revenue by Oct. 1. The tax would then begin Jan. 1 and the city would start seeing the additional money in about March.

Other fees discussed included those for garbage, bulk waste and recycling. Currently, the city only charges $5 a month per household for the service but subsidizes the rest of the cost. To cover the actual cost of the service, the city would have to raise the $5 fee to about $21.

Alderman Jim Fruin said the garbage service is one where the city was providing its residents with a "Cadillac" and wondered if something within the program could be cut to save money. Bloomington has no restrictions on the amount of garbage or bulk waste it will pick up from each household, and it offers curbside recycling.

He also questioned if there were other city services where residents were receiving a premium that could be cut.

"So your wondering if there are some Cadillac services where a Buick would do," Stockton asked Fruin, continuing the car comparison.

To that, Hanson warned, "You cut services, be prepared for the calls."