Property taxes in Homewood next year will pay for less than one-fifth of the village’s general corporate services, which include most day-to-day municipal operations.
According to the tax levy ordinance approved at the Dec. 13 village board meeting, property taxes for general corporate purposes are estimated at $3,467,250 for the fiscal year that starts May 1, 2017. The total amount budgeted for general corporate services in the coming year is $18,777,339, with $15,310,089 from other revenue sources, most notably sales taxes.
The ordinance also includes $2,178,742 for police and fire pensions, which brings the entire levy amount to $5,645,992. The ordinance reflects a 6 percent decrease in the amount to be levied by the village in the coming year.
Homewood must submit a tax levy to the Cook County Clerk’s office by the end of the calendar year. The levy and equalized assessed valuation (EAV), the total of all taxable property in Homewood, are key elements in setting tax rates. The clerk’s office will release property tax rates in the middle of 2017.
Village Finance Director Dennis Bubenik said Homewood is a non-home rule community, which means that the village must comply with the state’s Property Tax Extension Limitation Law, which since the 1990s has imposed a cap on tax levies. Levy increases are restricted to 5 percent or the federal Consumer Price Index (CPI), whichever is lower. For 2016, the CPI is estimated at 0.7 percent.
Information provided to the village board included a report indicating that Homewood, based on a $4,000 tax bill, receives 10 percent of local property taxes. Bubenik stated that the majority of property taxes is allocated to Homewood School District 153, which gets 34 of local property taxes and Homewood-Flossmoor High School District 233, which gets 35 percent.
“Our allocation is down by 6 percent for the coming year due to the fact that the village has no debt on the books and we have a 30 percent reserve,” Bubenik said.
Tax levy dollars are used for general fund operations such as street cleaning, snow plowing and water and sewer maintenance, as well as police and fire service.
Bubenik reminded the board that the decline in Homewood’s EAV that started after the 2007 housing crash, coupled with the tax cap limitation, impacts the amount the village can collect from property taxes.
“While there is a slight increase in the EAV, a return to a growing EAV should allow us in future years to allocate more toward day-to-day operations,” he said.