This is the season that taxpayers should be attending municipal meetings.
It’s when village trustees, city councilmen and aldermen decide how much to raise your taxes next year.
I almost added “if any” to the above sentence, but raising taxes is the nature of the beast called tax district.
“Feed me! Feed me!” one can almost hear the various types of school districts howling.
Just like in the “Little Shop of Horrors.”
Last Tuesday night I attended the Lakewood Village Board meeting.
After the group seeking a public-private partnership to build a new Village Hall left disappointed after Village Board members wanted more assurance that the estimated $3 million to be borrowed (out of about a $4 million total cost), the Board moved onto the tax levy.
Village President Erin Smith laid out three options:
- “Captur[ing] the tax we are able to tax (that is, taking as much as possible)
- “a ‘we never get that money back option’
- “the Woodstock option–defer [the final decision] until we have more information option”
The third option would allow for an abatement of some or all of the tax increase on current taxpayers.
The Property Tax Cap, which Board members referred to by the initials of the statute’s name, PTELL, allows every tax district to pry 3% more out of taxpayers’ collective pockets next spring than this year.
In addition, tax districts are allowed to “capture” new growth.
That is estimated to be 26/100 of 1%.
One can certainly make an argument that tax revenue from newly-built or re-modeled properties, such as those along Route 14 in Crystal Lake, should contribute tax revenues.
If the amount requested next year were the same as this year, the new assessed valuation would actually bring about a tax cut for existing taxpayers.
But the nature of government is to grow, so that rarely happens.
In any event, to get maximum taxes from the new growth, a tax district must basically guess what it will be. The actual number is not known until after all the assessment appeals have been complete.
Recommended to the Lakewood Board was the third option.
Pass what is called a “balloon” levy now which asks for the 3% increase in the Consumer Price Index, plus the County’s estimate of “new growth” and, then, when the final assessment appeal numbers are in, take another look to see if the Board wants to cut back the amount it is requesting.
Trustee Carl Davis argued, “Go for the maximum PTELL will allow.”
He pointed out that property taxes are not the only source of revenue the Village has, but it is “the only source deductible from Federal income taxes.”
Davis pointed out that vehicle stickers are not deductible and suggested eliminating that $65,000 revenue source instead of cutting property taxes.
Needless to say, I made a pitch from the taxpayers’ point of view.
The Board voted 6-0 to levy the maximum amount of taxes allowed by law with the understanding its members would re-visit the issue once the final assessment numbers are known.