Burr Ridge is moving closer to putting a referendum on the November ballot that would replace the taxes residents pay for Lake Michigan water with taxes for capital projects, such as road improvements.
Without such a move, the village will not be able to keep up the road maintenance program it has in place, according to village administrator Steve Stricker.
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“If we don’t look for another source of funding, we don’t have money to do roads in the future, and that starts in [fiscal year] 2017-18,” Stricker said.
Because the village has depleted money it had in reserve for road projects, the village will have six-figure budget deficits annually if it wants to keep its road maintenance program in place, village officials said. That is because the village would have to use its general fund to pay for the roadwork.
Stricker noted the bonds used to bring Lake Michigan water to Burr Ridge would be paid off at the end of this year. He said by replacing the 0.0489 tax rate residents cover for the water bonds with an identical amount for infrastructure improvements, residents would not be see their tax rate for the village increase and the municipality would have at least $520,000 annually for roads, sidewalks and other capital improvements.
By allowing the bonds to expire and the village’s bond and interest tax rate not replaced, the owner of a $600,000 would see about a $100 reduction in his or her taxes. Stricker suggested with other taxing bodies’ increases, that savings, which would lower the village’s portion of residents’ tax bill from 3 percent to 2 percent, would be negligible.
“Residents would not even notice it on their tax bill,” Stricker said.
The village’s water bonds were issued in 1996 and refinanced in 2003.
While no vote was taken at a village budget meeting Monday, no trustees said they flat out reject the idea of going to referendum. Stricker said the Village Board would need to decide by May about a November ballot question.
Trustee Al Paveza said it would be good to be able to provide residents with some tax relief, but also sees the need for money to keep village’s roads in top shape.
“I have mixed emotions,” Paveza said. “Right now, I could be swayed either way without too much effort.”
He added that if the village goes forward with an infrastructure referendum, the Village Board needs to be 100 percent behind it.
“The devil is in the details,” Paveza said. “[The referendum] will depend on how we spell things out.”
Stricker said he would rather have the referendum on the ballot in spring 2017, but by doing that the village would be asking for a tax increase because the taxes for the water bonds would have already expired. Having it on the November ballot would make it a case of exchanging one village tax rate for another.
Kevin Beese is a freelance writer for Pioneer Press.