Property Tax Bill Memo 2004

From: Walter E. Smithe, Finance Chairman

In December 2003 the Public Hearing for the Tax Levy was held, followed by the Village Board’s approval of a $5,379,036 levy for the implementation of Village services and operations. The 77% increase over last year’s tax extensions is attributed to many years of conservative 2 to 6% increases, which did not fully provide the funding needed to meet expenses.

Over the past few years, deficits have been building in a number of Village Funds: expenses exceeded revenues, and reserve funds were used to cover those deficits. Reserves are at alarmingly low level as this fiscal year ends. Since over 66% of revenues received come from property taxes, the Village is highly dependent on the levy.

In addition to the levy, the four counties are levying an additional amount for Debt Service, in that the Village was required to issue $3,000,000 in bonds for payment of a legal settlement. That amount is set at $258,000 this year. The total estimated property taxes levied for 2003, to be paid in 2004, are $5,637,941, which represents an 86% increase over the previous year.

Property tax bills are the end result of what begins as our levy. Included in the final figures are a number of variables attributable to the four counties’ actions after the filing of the levy. The townships are reassessing properties on an annual basis (with the exception of Cook County) and the counties are deciding on the tax rates and the percentage of tax burden each will take to divide our levy between the four of them. Last year Cook County assumed 60.46% of the tax burden, Kane 1.72%, Lake 16.41%, and McHenry 21.41%. Tax burden percentages change from year to year. Detail questions about each county tax bill may be obtained by contacting directly Cook (312-443-5100), Kane (630-232-3565), Lake (847-377-2323) and McHenry (815-344-4260).

A tax bill is not just created by the assessment and levy process. A public hearing was held on July 27, 2004 and in turn there was adopted the Appropriation Ordinance. This is an expenditure commitment that the Village is obligated by law to follow but through its prudent fiscal management stays well within the stated expenditures. Revenues obtain are show as in what amounts will be appropriated and a departure from that appropriation requires the same hearing process in the creation of the Ordinance. A copy of the adopted Appropriation Ordinance 04-10 is available through this site or on file with the office of the Village Clerk in the Village Hall.

A detailed discussion of property tax rates, assessment values, and equalizers by the Village President can be found in the Spring Newsletter. A statement on the Village’s budgetary needs by the Finance Committee Chairman can be found on page 2 of the same mailing. A copy of all the fiscal documents of the Village referenced in this memo may be obtained from the Village Treasurer (847-551-3002).