Elgin proposes $65.6M property tax levy for 2026 as officials weigh $4.2M budget gap

City of Elgin leaders on Nov. 12 unveiled the proposed 2026 budget and a recommended increase in the city’s general fund levy, saying the levy hike is aimed at closing a roughly $4.2 million shortfall and preserving public services.

Deb Naraki, the city’s finance director, told the Council’s Committee of the Whole that the proposed tax‑year 2025 levy to be received in 2026 would be $65.6 million, up about $7.7 million (13.2%) from the previous levy of $57.9 million. The administration’s 2026 revenue projection for all funds is $181.2 million, compared with a 2025 estimate of about $177.7 million.

The staff presentation said the increase reflects three components recorded inside the general fund: the general corporate levy (recommended to rise from $27.8 million to $32.0 million), and higher actuarially determined contributions for police and fire pension obligations. Naraki added that medical insurance premiums, collective bargaining adjustments and filling vacant positions are driving a large portion of the projected expenditure growth.

Why it matters: Naraki said staff projects 2026 expenditures to rise to roughly $190 million, driven mainly by earnings and benefits, which are forecast to climb from about $118.4 million in 2025 to $129.4 million in 2026. "This is about as lean a budget in terms of staffing recommendations as we've made in a number of years," City Manager Rick Kozel said during the meeting, noting long‑term cost growth largely comes from labor and benefit obligations.

What Council asked: Council members pressed staff for detail on so‑called “other charges” and requested charts translating the levy change to a typical household. Gio, a management analyst on staff, used assessed‑value census data and estimated the city portion of the average Elgin homeowner’s bill would rise by roughly $150 a year (about $12.50 per month) using 2023 assessments, while cautioning counties’ assessment data lag and results are ballpark estimates.

Staff timeline and next steps: Managers said follow‑up budget deliberations will continue on Nov. 19 (utility fund and other items), and the Truth in Taxation hearing is set for Dec. 3; the council must adopt a balanced budget by Dec. 17 under state law. Several council members asked staff to return with alternatives to a levy increase, such as sales‑tax scenarios, exemptions and detailed cost‑savings tied to hiring or program changes.

The meeting ended without a final vote on the levy; the Council will consider formal adoption and any changes during the December deliberations.