The Highland Park City Council approved the city’s fiscal year 2021 budget, and held a public hearing on its new property tax levy, which, if approved, will be increased to help offset lost revenue from the repealed vehicle sticker program.
The city’s operating revenue for FY21 is budgeted at $66 million, which is about 4% higher than the current estimate was for the current FY20, according to city budget documents. The city expects to receive a total of $79 million in revenue next fiscal year.
The 2021 spending plan indicates expected total expenditures of $86.
City Manager Ghida Neukirch said Highland Park went through an additional budget process this year to combat the financial fallout as a result of the novel coronavirus pandemic. The city needed to cut about $10 million worth of expenses to help manage the FY20 budget, she said. As a result, the city made several cuts, including a 10% reduction in staff, Neukirch said.
Neukirch said the coronavirus pandemic has had an impact on a vast majority of revenue sources. This includes sales tax, food and beverage tax, motor fuel tax, parking revenue, interest income and building permits, she said.
During the Nov. 9 meeting, the council also held a public hearing on a proposed property tax levy. If approved, it would add about $83 to the tax bill of a property valued at $500,000, according to city documents. The increased levy is expected to offset the $1.1 million in lost revenue from the city’s repeal of vehicle stickers that residents will no longer have to purchase. The move was made in April as part of the city’s relief efforts to help residents deal with financial fallout from the pandemic, officials said.
As a result, residents on average will see a net-zero change in payments to the city, because they will not be paying the average $83 in yearly vehicle stickers, officials explained. Neukirch said residents who own a home valued at $500,000, along with two cars and purchase two vehicle stickers yearly, would pay less with the levy increase.
Despite the trade-off, Neukirch said the city has received some complaints about the proposed increasing tax levy increase. She explained that the city’s portion of property taxes makes up about 7% of a property owner’s tax bill, and that the city of Highland Park, as a whole, has the lowest tax rate compared to all other municipalities on the North Shore.
“We are working diligently to be sensitive to the economic impact COVID has had on our community,” Neukrich said. “We have presented a budget that is balanced without any fee increases or new additional revenue planned from taxes or fees.”