West Dundee hikes property tax, enacts new taxes

What West Dundee residents saved in shopping bills this year they may end up paying the village on next year's tax bill.

To plug a budget hole caused largely by declining sales tax revenue, the West Dundee village board this week increased its annual property tax levy and enacted three new taxes that take effect in January.

Officials hope the tax hikes, combined with $225,000 in cuts so far and another $150,000 in future cuts, will erase a budget deficit of $365,000 and rebuild the village's fund balances, allowing it to pay bills on time without borrowing.

If the economy turns around soon, West Dundee officials say they plan to mitigate the increase for next year's levy and reduce or eliminate the new taxes.

"Once we're on a stronger footing, we certainly hope to take a look at that," Finance Director Dave Danielson said. "We would certainly be receptive to lowering (the levy) if our other revenue sources pick up to levels that they were in the past."

The village expects to collect about $3 million in property taxes next year, a 14 percent increase over the $2.6 million it collected in 2009. Unlike some other towns, West Dundee can raise taxes faster than the rate of inflation because it has home rule status.

Danielson estimates the village's tax rate next year will be about $1 per $100 of equalized assessed value, adding $108 to the tax bill for a $250,000 home.

The new taxes will amount to an estimated 5 percent tax on electricity, natural gas and telecommunications bills, together bringing in an estimated $700,000 to village coffers annually and costing the average homeowner $185, according to the village.