First Carol Stream property tax in decades will cost average homeowner $232 a year
Carol Stream residents will pay a village property tax for the first time in more than 40 years.
Trustees unanimously agreed Monday to establish the municipal tax, making Oak Brook and Willowbrook the only remaining towns in DuPage County not to levy a real estate tax.
The $3.8 million levy adopted by trustees will cost the owner of a home worth $231,400, the average in Carol Stream, $232 annually in property taxes to the village, starting in May 2020.
The village board approved the recommendation of financial planners to create a new funding source to make up for slumping sales tax revenue and to help pay for rising police pension costs and a five-year infrastructure plan.
But during a two-hour-long public hearing, opponents raised doubts that the village has done enough to the hold the line on operating costs and attract new businesses to avoid implementing the tax. Residents told the board they're already overtaxed.
"My taxes have gone up $6,000," Mike Wade said. "These $100 bills turn into thousands of dollars."
Funding for Carol Stream's operations now heavily rely on sales tax revenues, amounting to 44% of village income. Those revenues fell 6.6% in 2017 and 2.4% in 2018. So far, the village has seen a decline of 4.1% in the current fiscal year that ends April 30.
With adoption of the $3.8 million levy, property taxes will account for 12% of total revenues, officials say.
Officials said they're losing out on sales taxes because of a significant shift in shopping habits as consumers buy online instead of in brick-and-mortar stores.
"There are so many towns that are in debt right now because they just kept kicking that can down the road," Mayor Frank Saverino said. "I just can't see myself doing that."
John Jaszka, a park district commissioner, called on trustees to "take a step back" and reconsider the plan, directing the board to the nearly 430 signatures on an online petition against the tax. Jaszka urged the board to review staffing levels, "up 20-plus people or 15% the last five to seven years."
"Your tax will not only hurt homeowners and their property values, but it also hurts renters even more so, the people that are least able to afford these rent increases that will come when landlords raise their rents after you hit everyone with a property tax," Jaszka said. "
The village has 164 full- and part-time positions, down 3.8% from the staffing levels before the Great Recession, Assistant Village Manager Joe Carey said.
"Predominantly, the number of employees that we have hired since the recession are all really boots-on-the-ground employees. Those are public safety individuals, police officers, public works who serve this community on the ground," he said.
Board members called the tax a last resort. For much of its 60-year history, Carol Stream has been one of the few DuPage County towns without a municipal tax. In the 1990s, the board avoided implementing a property tax by establishing a real estate transfer tax.
More recently, a new gas tax went into effect in June 2018 as the first dedicated funding source for the village's road program. Then last July, the village began collecting a liquor tax.
Board members also have faced questions for spending cash reserves on an expansion of village hall and for agreeing to loan the library district up to $2 million for a renovation of its Hiawatha Drive building. Both the original library and village hall date to the 1970s.
"Everybody said, 'Oh you built a big building.' This building should have been done 10 years ago," Saverino said of the municipal center addition.
About a year after the $19 million project, officials warned of projections showing Carol Stream running out of capital reserves during the third year of a five-year plan for roadwork, addressing creek erosion and infrastructure repairs.
"Now we have a dedicated funding source for a capital improvement program," Trustee Rick Gieser said.