Algonquin raises phone tax by 60 percent

Come July, Algonquin residents will see a spike in their telephone and Internet service bills.

The village board this week approved a 60 percent increase to the telecommunications tax to help fund park improvements, such as playground maintenance, trails, bike paths and other infrastructure upgrades.

The village's current telecommunication tax rate of 3.75 percent will go up to 6 percent - the maximum allowed by state law - July 1. It will generate an additional $400,000 in yearly revenue, Assistant Village Manager Michael Kumbera said.

The tax applies to voice call charges for cellphones and landlines, specialized mobile radios, and dial-up/ DSL Internet services. The village received $541,000 in revenue last fiscal year. A majority of that money goes into the village's street improvement fund, Kumbera said.

"One of the conditions of the board was (the increase) was to go exclusively to our park fund," he added. "Nothing will go to general operations. It's purely (for) infrastructure."

It's the first time the village has increased the tax rate since the telecommunications ordinance was enacted in 1997.

Several neighboring communities - including Bartlett, Batavia, Carpentersville, Cary, Crystal Lake, Geneva, Huntley, and Lake in the Hills - assess the maximum of 6 percent for telecommunications taxes. Algonquin's rate is in the bottom 20th percentile of communities surveyed, Kumbera said.

Kumbera said officials realized the need for additional revenue to fund parks during the budget process earlier this year.

Much of the village's parks infrastructure was built during its high growth years in the mid-1990s.

Algonquin has grown from a town of about 11,000 residents in 1990 to 30,000 residents.

As new developments came to town, developers bore the costs of building parks and associated facilities, Kumbera said.

"We are coming due to replace all that," Kumbera said.

There are 24 parks in the village. The additional revenue will be used to upgrade existing sidewalks, trails, naturalized detention basins, stream banks, playground equipment, restroom facilities, and public parking lots - "anything that has a life cycle of about 15 to 20 years," Kumbera said.

More specifics about future parks improvements will be outlined in the village's capital budget to be presented in January, he added.