Schaumburg officials seeking electricity tax to improve local power grid, bury more lines
Schaumburg plans to join the ranks of 294 Illinois towns that already impose a municipal electricity tax, but in its own case for the specific purpose of improving the local power infrastructure and burying more lines.
Village trustees Tuesday directed staff to draw up an ordinance to create the tax next month and enable it to take effect as early as May 1 if desired.
The rate will mirror that of several surrounding communities and is estimated to cause an average increase of $3.05 per month or $36.55 per year on the electric bills of Schaumburg residents.
The annual collection amount of the tax is currently estimated at $3.5 million.
Schaumburg Mayor Tom Dailly raised the possibility last December during the village board’s annual discussion of its five-year capital improvement plan.
He spoke of the increased electricity demands of many households, including from electric vehicles and other devices. Improvements to villagewide infrastructure can help meet that demand, while burial of lines has been shown to make the system more reliable, he added.
“I want to make sure that the power coming down that line can handle that,” Dailly said of staying ahead of demand. “I think it’s helping the whole village of Schaumburg.”
Whichever month is selected to start collecting the tax, the village should have enough knowledge of the new revenue by next December’s revisiting of the capital improvement plan to decide where to prioritize it, Dailly said.
Officials already have identified 25 potential burial projects, divided among three priority levels, that together add up to an estimated $193 million.
Though specific prioritization has yet to occur, Dailly said a 0.39-mile stretch of Meacham Road from Shady Lane to Willow Road estimated to cost just over $3 million for power-line burial could be a highly visible place to demonstrate what’s possible with a single year’s revenue from the tax.
One of the larger identified potentials is a 1.5-mile stretch of Plum Grove Road from Wise Road to Schaumburg Road estimated to cost $11.8 million for burial of electrical lines.
Though Schaumburg’s plan is to use the electricity tax for a specifically electrical reason, this type of municipal tax doesn’t come with a restriction to use it for that in the other cities and villages that have already adopted it, Schaumburg Finance Director Lisa Petersen said.
The exact tax rate is 0.628 cents per kilowatt-hour for use of less than 2,000 kilowatt-hours per month. But the average rate of use among residential customers in Schaumburg is 499 kilowatt-hours per month, with few exceeding the 2,000 kilowatt-hours level, Petersen said.