Trustees weigh levy options as staff outlines pension-driven pressure on property tax
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Summary
Finance staff recommended starting with the consumer price index (3.4% CPI) as a guideline for next year’s tax levy; trustees discussed options (0%, 2.5%, 3.4%) and informally coalesced around 2.5% with new construction, while staff stressed pension obligations (police pension 61.9% funded; 90% target by 2040) and the compounding effect of not taking CPI increases.
Finance staff presented the village’s preliminary property tax-levy options and a timeline for notice and the Truth in Taxation hearing. Staff explained that as a non-home-rule community the village is more reliant on property tax and typically starts levy requests at the CPI (this year 3.4%) plus new construction. The presentation showed historical levy choices and illustrated how choosing not to take CPI in one year compounds lost revenue over subsequent years.
Jason said the 2023 levy totaled about $2.8 million, with roughly 65% directed to the police pension; the pension is currently about 61.9% funded and staff cited a state-funded target of 90% by 2040, meaning pension contributions will absorb a growing share of levy revenues. Staff presented model scenarios: 0% CPI (new construction only), a repeat of last year’s 2.5%, or the full 3.4% CPI request.
Trustees expressed a range of positions: some favored 0% with new construction only; others supported 2.5% as a compromise; one trustee preferred taking 3.4% because of pension needs. Chair recorded a working consensus of four trustees favoring 2.5% (no formal roll-call vote recorded at the meeting). Staff said they will publish notice for the Truth in Taxation hearing and return with the formal levy ordinance for the Dec. 2 hearing and vote.