Schaumburg may stop reducing property tax levy
Schaumburg may halt its practice of faithfully lowering its property tax levy each year, due to the financial uncertainties caused by the gridlocked state government, village officials say.
The village board's finance committee Wednesday recommended keeping this year's levy at last year's level of $20.7 million, rather than continuing the recent trend of a 1 percent annual reduction.
Village Trustee George Dunham, who chairs the committee, said its necessary because the state has not paid municipalities their share of taxes in a timely manner.
"This puts us in the unenviable position of having to go back on our word, when Springfield fails in its obligations," Dunham said. "I'm extremely disappointed with the (Illinois) General Assembly. I think we've been good stewards of the local money."
Village Manager Brian Townsend said the state recently has not paid Schaumburg its $300,000 monthly share of motor-fuel and use taxes. The latter is a form of sales tax on items purchased outside Illinois for use in Illinois.
Even beyond such delayed payments are concerns that state funding for municipalities may be permanently reduced, he said.
"We don't want to make the situation worse than it already is," Townsend said.
By keeping the tax levy flat, the village will collect $207,000 more than it would if it reduced the levy 1 percent. Even that isn't going to patch the financial hole being created for the village, Townsend said.
A "flat" levy - which stays the same from one year to the next - would be good news for most taxing bodies, which depend more heavily on property taxes to cover their costs. But Schaumburg has built up a strong local economy that provides significant consumer-driven revenue through sales, hotel, telecommunications, and food and beverage taxes.
The economy is continuing to recover from the recession that led Schaumburg to create its first property tax levy in 2009, Townsend said. The only consumer tax that's underperforming is telecommunications, largely because people are using fewer and more competitively priced phone lines than in the past, he said.
The full village board will vote on what level to set the levy on Nov. 10, then grant approval of that amount on Dec. 8.