Before accepting an ordinance on the 2022 Property Tax Levy estimate Monday, the La Grange Board of Trustees debated the amount and approved a smaller estimate.
After the review, mandatory by state law, of a preliminary estimate of a 5.6 % increase, the Board agreed to a reduced estimate of 4.6 %.
The 0.6 % represents new growth in the Village.
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“This year is hopefully an anomaly as we look at these increases going forward,” Trustee Michael Kotynek, filling as President of the Board with Mark Kuchler missing, said.
The tax levy is subject to the state’s Property Tax Extension Limitation Law (PTELL), meaning it has to limit increase to 5 % of the Consumer Price Index, exclusive of new growth, whichever is less.
CPI for 2021 was 7 %, so La Grange’s proposed levy reached the 5 % limit for the first time since PTELL went into effect in 1993. During the time since PTELL’s enactment, La Grange’s levy has averaged 2.2 % annually.
The ordinance before the Board was only to accept the estimate. The actual levy will be voted on at the Dec. 12 Board meeting. And they if they decide to make another change, they are allowed to do so.
The total levy, as first proposed, would have been $11,165,773 for the Village alone. A 4.6 % levy increase would result in a total levy of $11,086,064.
Because the La Grange Public Library is a municipal library and not a separate taxing entity, the Library’s requested levy was included with the Village’s, coming to $2,796,282.
A special service levy, not subject to PTELL, for the purpose of maintaining the Central Business District, was also included in the total of $104,980, a 5 % increase.
Kotynek noted that Kuchler, absent because of a death in the family, indicated to him that he wanted to challenge the Board to come up with a different number than 5.6 %, and the Trustees were only too happy to take up the challenge.
“Right now, I have to say I’m leaning toward the full 5 %,” Trustee Peggy Peterson said, noting the new police contract, the significant pension contributions for Police and Fire protection and the competitive wages the Village maintained.
Arguing for a lower rate, some of her colleagues disagreed.
“My feeling on it is we’ve got good reserves and we’ve got added revenue,” Trustee Lou Gale said. “I’d like to see if we could have some downward pressure on the property tax levy.”
Kotynek echoed Gales sentiments.
“I’m a little tax-averse as well,” he said, noting that it had been a “tough year” and that many government entities had “a lot of hands in their (taxpayers) pockets. I would support a lower number, certainly lower than inflation and the 5 %.”
The ordinance to accept the 5.6 % increase was voted down 5-1, with Peterson dissenting.
When a second ordinance was proposed with the same language and a 4.6 % estimated increase, it passed unanimously.
The original proposed estimate would have meant a $78 increase to the homeowner with a $500,000 house. If the Village winds up approving a levy for the agreed upon 4.6 % increase, the homeowner’s bill property tax bill would be lowered by $15.
The 4.6 % decrease of the levy would reduce the Village’s share by $90.000 for the year.
The original estimated levy of $11,165,773 consisted of the General Fund ($5,141,998) including Police and Fire Protection, (both at $1,540,767), Police Pension ($1,826,660) and Fire Pension ($1,400,833).
Debt service, not restricted by PTELL, was $624,750, bringing the total levy to $11,790,523.
With the revised estimate coming in at 4.6 %, and uncertainty over the Library portion of the levy, it’s unclear at this time what effect the 1 % decrease would have on each line item.
It’s unclear whether or not the Library has the authority to still levy at the 5.6 % figure or has to match the Board’s entire levy which the Village Board ultimately decides December 12.
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And the Board, being the ultimate authority on what to levy, can debate the issue further at its Dec. 12 meeting and could, in theory, come up with a different increase from the agree-upon preliminary estimate of a 4.6 % increase.
The next La Grange Village Board meeting wipe be 7:30 p.m., Dec. 29 at the La Grange Village Hall, 53 N. La Grange Road.