Hawthorn Woods wants property tax hike to fund $25.7 million road plan
Hawthorn Woods voters will decide in April whether to increase property taxes to fund a $25.7 million comprehensive road improvement program.
The need for such a program and discussion of how to pay for it has percolated for several years. The talk has intensified as village streets further deteriorated.
After meeting with homeowner groups, hosting public information sessions and surveying residents, a tax hike was determined to be the preferred method to raise money, officials say. On Monday, the village board agreed to have the question placed on the April 2 consolidated election ballot.
Voters will be asked whether the village tax rate should be increased to generate nearly $1.8 million per year. If approved, the tax bill for a home valued at $500,000 would increase by about $650 a year beginning in 2020.
"We're trying to fix this so it's sustainable and fiscally responsible," said Pam Newton, the village's chief operating officer. "We're looking at an equitable rate for all. It makes for a more just and fair system."
Before Monday's vote, officials weighed varying levels of work - with different estimated costs - to include flood control projects and bike paths. But the focus was narrowed to a 15-year roadwork and culvert replacement program.
"The option supported by the majority of residents was to focus on the street plan," said Kristin Kazenas, the village's chief financial officer. "It's the least expensive option."
Newton said the last comprehensive road program was created in 2003.
That involved the village borrowing money by issuing bonds and creating special service areas to pay them off.
But that didn't allow for ongoing maintenance or repair, and 90 percent of the village's 57 miles of road urgently need to be resurfaced or rebuilt, she said. Restoration in some cases would delay the need to rebuild a given road, which is much more expensive, officials say. Issuing bonds for a new road repair program instead of a tax hike would incur significant costs, according to Newton.
"The interest would be $13.5 million over the term," she said. "Instead of borrowing all the money upfront, we'll save that $13.5 million and do a pay-as-you-go-plan."
The annual cost to homeowners in the three special service areas is $230, $390 and $400, and will continue until the bonds and interest are paid and the obligation removed from tax bills in 2023, Kazenas said.
Kazenas said approval of the property tax hike would result in a "sustainable, long-term financing mechanism" for roads. "It's been 15 years since we generated any new money for our road program," Newton said. "We've carried these streets to their maximum life span. It's really up to the people to decide."
Residents can learn more about the proposed road program by clicking on "Hawthorn Woods Paves the Way" on the village's website, www.vhw.org.