East, West Dundee ask for higher property tax levies

Faced with dwindling cash reserves and strained sales tax revenues, both East Dundee and West Dundee are looking at raising their property tax levies to shore up shrinking budgets.

West Dundee will seek a $3 million property tax levy, a 14 percent increase over the 2008 levy of just more than $2.6 million. Meanwhile, East Dundee will look to raise the levy by 4.99 percent over last year to $573,300.

Though state law limits the property tax extension to the lesser of 5 percent or the increase in the national consumer price index - which is currently less than 1 percent - East Dundee and West Dundee are both exempt from the law because they are home rule communities.

East Dundee finance director Nick Cinquegrani said the village would abate much of the levy.

"It has been the village's policy not to go beyond the law limits," Cinquegrani said. "We will raise it 4.99 percent now, then abate it back in early 2010."

Based on the proposed levy, East Dundee property tax rates will be just over 46 cents per $100 of equalized assessed value, about 7 percent higher than the 2008 rate of about 43 cents.

The village's property tax levy does not include the fire protection district's levy. In 2008, the tax rate including the fire protection levy was $1.03 per $100, Cinquegrani said.

West Dundee trustees recommended the property tax rate of $1 per $100 of equalized assessed value, based on estimates from the Kane County Assessor. The proposed rate is up from the 2008 rate of 87 cents per $100 and would add $108 to the tax bill for a home valued at $250,000.

"We have had to pull from the general fund to the point where we don't have anything left," West Dundee Trustee Norm Osth said. "We have about one month's bankroll right now. We are not introducing any new programs. The increase will go toward the general fund balance so that should something bad happen ... we will hopefully have enough money to pay for it without putting the town in jeopardy."

Despite making more than $225,000 in cuts from the village's spending in the first half of the year, West Dundee needs to find a way to replenish its general fund balance, which is at critically low levels, Osth said. Ideally, the general fund balance is maintained at about $2 million, but that number has fallen to about $1.1 million due to sales tax revenue losses in the last five years.