St. Charles residents to see slight increase to city portion of property tax bill
St. Charles residents are set to see a small increase in their city property taxes next year as a result of a proposed 3.4% increase to the city portion of the tax bill.
At the St. Charles City Council's Government Operations Committee meeting on Monday, the majority of alderpersons recommended approval of the preliminary estimate of $24,351,284 for the 2022 property tax levy. Of that amount, the city would abate $10,165,001 in its entirety.
Voting "no" were 4th Ward Alderperson David Pietryla and 4th Ward Alderperson Bryan Wirball.
The owner of a house with a fair cash value on the property tax bill of $300,000 would pay an additional $24 a year or $2 a month, assuming there is no change in the assessed value of a home relative to other properties and the city as a whole, Finance Director Bill Hannah told alderpersons. Kane County is estimating that the equalized assessed valuation for the city will increase by approximately 6% in total.
"One of the main considerations that was considered was the increases in police and fire pension funding," Hannah said in talking to alderpersons about the proposed tax levy.
The Police Pension Fund required city contribution funded by the levy is increasing $300,164 or 7.8% to $4,170,718, Hannah said. In addition, the Firefighter's Pension Fund required city contribution funded by the levy is increasing $139,205 or 5.4% to $2,719,565.
"While the city still has many operating and capital needs that will require funding, staff feels that it would be appropriate to set the estimated total operating tax levy to incorporate the increased amounts for police and fire pensions, an increase for the Mental Health Board, and keep the other levy components essentially flat," Hannah said. "This would keep the total increase at 3.39%, less than the increase last year, while maintaining the level of property tax dollars levied for the corporate, fire protection and police protection components of the levy."
Third Ward Alderperson Paul Lencioni voiced concerns about rising pension costs.
"We must find ways to get these pension costs under control," he said. "We have to have a plan at some point. I support what you've done. I think it is a noble effort. But it won't do in the future."
In reply, Hannah said there are different things that can discussed in the long term.
"Your point is well taken," he said.
Other alderpersons voiced similar concerns.
Property taxes comprise about 25% of the city's budgeted revenues for the general fund and are a key revenue source for funding core city services such as police protection, fire protection and public works, Hannah told alderpersons.
Last year, the city increased the operating levy from the previous year by 4.99%.
"This helped the city fund its operating budget for the FY 2022-23 and pass a balanced general fund budget," Hannah said. "The city has also benefited from increases in sales tax and other tax revenues over the past year which has improved the city's short-term fiscal outlook."