It can be done: Northern Illinois village cuts property tax levy 10 percent

It can be done: Northern Illinois village cuts property tax levy 10 percent

The village of Lakewood is making encouraging reforms in a county where residents pay some of the highest property taxes in the nation.

Property tax bills are squeezing the budgets of Illinois families across the state. But one village in northern Illinois aims to play a part in easing that burden.

Members of the Lakewood village board voted Dec. 18, 2017, to cut the village’s 2018 property tax levy 10 percent.

Lakewood is located in McHenry County, where residents see some of the highest property taxes in the nation. The village also made headlines in June when trustees voted to dissolve a $66 million tax increment financing, or TIF, district.

A property tax levy is the amount of property taxes the local government will collect in a given year. The 10 percent reduction in Lakewood’s levy represents a $176,000 reduction from the previous year, bringing the 2018 levy to just under $1.6 million.

The proposal was put forth by Village President Paul Serwatka, who took office in May 2017 and immediately pushed to dissolve the TIF. The success of that measure encouraged him to continue finding additional ways to decrease taxes for the village’s residents, without eliminating or reducing amenities.

“We completely transformed our village administration,” he said. “We were able to … find where they created sort of a big, top-heavy bureaucracy within our tiny village.”

One way to cut the levy was to restructure management. The village combined the village manager position with the financial director, and eliminated the deputy manager position.

Compensation for village managers can be a source of frustration for Illinois residents, who saw property taxes grow six times faster than the median household income from 2008-2015. Village or city managers in Evanston, Rosemont, Libertyville, Lake Forest, Palatine and Northbrook all make over $200,000, while as recently as 2016, the village manager in Glenview made more than $300,000, making that position the state’s most expensive municipal official position. All these managers make more than every governor in the U.S.

Thankfully for taxpayers, Lakewood’s actions mirror that of McHenry County, where county board members voted to cut the county’s property tax levy 10 percent in April 2017.

The recent events in McHenry prove that while the state too often ties the hands of local leaders in driving up spending, reform-minded officials can still find ways to reduce property tax levies.

If more communities like Lakewood don’t take on initiatives to lower their property taxes, more and more residents may look for other states to call home. From July 2016 to July 2017, Illinois lost a record 115,000 residents on net to other states. Without reforms, those losses will drive up property tax burdens for the Illinoisans who remain.

Serwatka already has plans to propose another levy cut for next year, this time closer to a 15 percent reduction. “[We] hope it’s like a snowball,” Serwatka said, “that will continue to grow and grow and grow.”

Illinoisans can only hope Lakewood’s efforts spread across the state, encouraging other local governments to not just freeze tax levies at their current unaffordable levels, but to reduce families’ property tax burdens.

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