Forest Park officials will raise an additional $239,000 through the village's annual tax levy adopted Monday, over four times higher than in previous years, but residents will not see a corresponding increase on the village portion of their property tax bills.
Almost half of the increase is the result of the termination of the Roosevelt Road tax increment financing (TIF) district. A higher consumer price index (CPI), which affects the tax cap, also led to increased property tax revenue.
The levy calls for $5,502,948 to be raised in property taxes for the fiscal year that began May 1, 2017 and ends on April 30, 2018, an increase of $239,705 above the $5,263,243 requested for the fiscal year from May 1, 2016, to April 30, 2017.
The property tax levy covers less than 20 percent of the village's appropriation, with the remaining revenue coming from sales taxes, fees and grants.
Letitia Olmsted, village finance director, noted that the additional revenue from the termination of the TIF district is estimated to be $104,000.
"The TIF termination led to this increase," Commissioner Tom Mannix said. "It won't have a big impact on homeowners."
Olmsted said the levy will generate an additional $111,000 in "new money" as a result of the higher CPI.
Village Administrator Tim Gillian emphasized the increase in "new money," noting it has averaged less than $50,000 in recent years.
"We got a little more this year due to the higher CPI," he said. Olmsted pointed out that the CPI has averaged 1 percent in recent years.
In the past, village officials have noted that the village portion of the average village homeowner's property tax bill is not as significant as the portions for education, specifically Forest Park Elementary School District 91 and Proviso High School District 209.
Referring to previous years' lean budgets, Mayor Anthony Calderone praised current staff, current elected officials and past elected officials for doing a "stellar job" in managing our finances.
"I haven't seen any irresponsibility," he added.
Olmsted noted that half of the village's property tax levy goes toward pension obligations.
The council also approved the annual tax levy for the Forest Park Public Library, which falls under the auspices of the village but is governed separately. The library levy for FY2017-18 is $1,812,793, an increase from $1,752,473, half of which, like the village's increase, comes from the termination of the Roosevelt Road TIF District.
In addition, the village council on Monday passed two additional levy-related ordinances, one directing the Cook County clerk to calculate separate limiting rates for the village and for the library and the other directing the County clerk to reduce the corporate fund portion of the village's levy if the overall amount requested needs to be reduced.
The village and the library are both subject to the Property Tax Extension Limitation Law, which limits property tax levy increases to 5 percent or the CPI, whichever is lower. This year, the tax cap is 2.1 percent, which is the CPI.
Of the village's levy request, $1,037,948 is for the Office of Public Affairs, which includes $900,000 for the police department, and $3,425,000 is for the Office of Accounts and Finances, which includes $960,000 for the fire department.
TIF is a tool that Illinois lawmakers gave local governments in 1977 to help them restore their most run-down areas or jumpstart economically sluggish parts of town. With this tool, financially strapped local governments can make the improvements they need, such as new roads or new sewers, and provide incentives to attract businesses or help existing businesses expand, without tapping into general funds or raising taxes.
Following creation of a TIF district, the equalized assessed valuation (EAV) of the property is frozen for taxing bodies whose boundaries include the district. Any property tax revenue generated by the increased EAV goes into the TIF fund to be spent on improvements in the district, generally infrastructure.
Since its creation in 1993, the EAV of the Roosevelt Road TIF District has increased from $1,570,380 to $6,748,617.