A state law designed to halt spiraling property tax bills in Chicago`s collar counties has not stopped governments from asking for tax increases well in excess of the law`s limit, and some taxing bodies in Cook County admit to inflating their requests out of fear that the law may soon apply to them.
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Most collar county school districts, which account for the majority of a typical tax bill, are asking for tax increases of more than 5 percent, with many requests exceeding 10 percent. Under state law, those requests, called levies, had to be filed by Tuesday.
The tax cap law requires most taxing bodies in Du Page, Lake, Will, Kane and McHenry counties to limit annual increases in tax collections to 5 percent or the rate of inflation, whichever is less. Republican legislators are expected to push next spring to extend the politically popular law to Cook County.
Many taxing bodies will not receive the full amount they are seeking in their tax levies and could still abate the levies. But exemptions for home-rule governments and loopholes allowing for growth mean that many districts will be permitted to increase their tax collections by more than 5 percent over last year.
Exactly how the levies will affect tax bills won`t be known until this spring in the collar counties and midsummer in Cook County when the tax rates are released. But the levies show that taxing bodies in Cook and the collar counties are trying to bring in as much revenue as possible.
”It shows the taxpayers that districts are trying to get as much money as they possibly can,” said Du Page County Clerk Gary King. ”The tax caps are putting added responsibility on my office . . . to make sure (the taxing districts) don`t get a penny more than they are entitled to.”
Whatever their final impact, the levy increases are likely to provide ammunition for Democratic lawmakers who oppose extending the cap to Cook County. Moreover, they provide the latest example of how the law aimed at holding down tax bills may not accomplish its aim and, in some instances, may be driving up taxes.
In anticipation of tax cap legislation, some officials in Cook concede that they have boosted property tax requests this year. Raising the levy now gives those governments a higher base from which to start if a Cook County tax cap is passed.
”If I were facing the prospect of a cap, I would want to hedge against that,” said Jerry Glaub, a spokesman for the Illinois Association of School Boards. ”If you want to ensure some growth, you want to raise that base because you know your costs aren`t going to be capped at 4 or 5 percent.”
Dozens of collar-county taxing bodies accelerated bond sales last year to beat the Oct. 1 starting date of the law. The impact of those bond sales will show up later this year on tax bills as homeowners begin paying off the debt, which funded everything from school safety improvements to new parks.
Backers of the tax cap downplay the significance of the levy increases. Tax requests ”have always gone up double digits,” said state Sen. James
”Pate” Philip (R-Wood Dale). ”The first tax bill is probably going to be a lot lower than if we hadn`t had the cap.”
Because school officials rely so heavily on property taxes, they staunchly opposed the tax cap, arguing that it would mean larger classes and eliminating some programs. But levies filed with the county clerks show that some school districts have found a way around the 5 percent cap.
In Du Page County, for example, 45 of 51 school districts were requesting tax hikes of more than 5 percent. Of those, five districts were asking for increases of more than 20 percent. Ten districts were requesting increases between 15 and 20 percent. Another 16 districts were asking between 10 and 15 percent. And 14 are seeking increases between 5 and 10 percent. Figures for the other six districts were not available.
Many of the districts-such as Indian Prairie Community Unit School District 204 in Aurora and Naperville, which is seeking a 20-percent increase- are located in high-growth areas covered by a loophole in the tax cap law.
Under the loophole, local officials can increase property taxes beyond the 5 percent cap if there is new development within their boundaries. The exemption had been sought because officials said new construction meant additional students for the schools and therefore higher costs.
A Kane County district taking advantage of the growth loophole is Geneva District 304, where officials are seeking a 15-percent tax hike. School Supt. John Murphy said new development in the district allowed for the additional revenue, though he expects taxes will actually increase only 9 percent.
But Murphy said that the loophole won`t cover the increased costs of a ballooning enrollment and that the district still figures to lose $120,000 this year as a result of the cap. ”We are just trying to stay even,” Murphy said.
In Cook County, only a few officials admit publicly to increasing their tax requests beyond what is absolutely necessary to run their governments. But some say privately that the practice has become fairly common as officials worry about painting themselves into a corner if they don`t take steps now to soften the impact of a possible tax cap.
One taxing body that has gone on the defensive is Forest Park Elementary District 91. In 1990, voters approved a tax rate increase, which the west Cook district of 1,114 students had planned to phase in over three years.
But facing the possibility that a cap would prevent the district from raising all the money it was entitled to, Supt. Joseph Scolire said the district decided to tax at the maximum this year. As a result, taxes in the district will rise faster than they might have otherwise, increasing 19.5 percent this year.
”We all could do a better job of tightening our belts,” said Scolire.
”But when the cuts come, those are tough and people don`t like those either. Then they say, `Where are the band programs and the sports programs and why are the textbooks 15 years old?` ”
The picture is different in home-rule municipalities in the collar counties, mainly large communities such as Aurora and Waukegan. Such suburbs account for roughly one of every three residents in the collar counties.
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The tax cap law approved last July exempted home-rule municipalities. But surprisingly, most home-rule suburbs have limited their tax requests to 5 percent or less.
In Du Page County, Downers Grove is asking for $2.5 million, the same amount it has sought since 1986. The tax levy in the Lake County suburb of Deerfield is up 1.6 percent over what was received last year. Aurora, the largest suburb with nearly 100,000 people, is seeking $19.1 million in property taxes, a 5 percent increase over 1990.
”There has been a very clear message that the residents of our community want us to live within our means and make every effort to contain property taxes,” said Aurora Mayor David Pierce.
But several home-rule suburbs want to increase their taxes by more than 5 percent, county records show. Waukegan is asking for increase of 7.7 percent, while Wheaton is seeking an increase of more than 18 percent.
Whe it is proceeding with plans to build a fire station in a fast-growing part of town that were in effect before the tax cap passed last July.
”It`s tough times in Du Page County as well as the rest of the area. Our council is sensitive to that,” Wiersma said.