WOODSTOCK – McHenry County government will aim again to keep its levy flat and not collect an inflationary increase next fiscal year.
The goal was part of the 2014 budget process approved Tuesday morning by the County Board on a 20-0 vote. The 21-page document sets down the guidelines by which county government will develop its spending plan to be approved for fiscal 2014, which starts Dec. 1.
“I think it will be another year of a good, reasonable budget,” Finance and Audit Committee Chairwoman Mary McCann, R-Woodstock, said after the meeting. “I think we’ve been really focused on keeping a good fiscal rating and doing the best we can to provide the best services without raising taxes. But it’s becoming more challenging because costs are going up.”
The budget process will allow county staff to capture first-year growth, which is not subject to the tax cap. However, it will not collect the 1.7 percent extension increase that taxing bodies are entitled to on next year’s taxes under the law.
The process approved Tuesday applies only to county government, which makes up about 10 percent of property-tax bills. It does not apply to municipalities, school districts, townships or other independent bodies.
County Board members chose last year to reject the 3 percent increase the county could have collected under the law on this year’s bills, citing struggling property owners angry that tax bills have been increasing despite the fact that home values have fallen.
The tax cap law in place for more than 20 years has had an unforeseen effect with the bursting of the housing bubble.
When home values are rising, it limits the increase that taxing bodies can receive over the previous year to either 5 percent or the rate of inflation, whichever is less. But when values fall, a scenario state lawmakers never envisioned, the tax cap ensures that governments receive the inflationary rate if they so choose.
Changes made to this year’s budget process include a directive to all departments to review the cost of service delivery and begin considering cost-saving options such as outsourcing, privatization and public/private partnerships.
Outside agencies that receive County Board funding also will have to make presentations to the finance committee on top of their required meeting with the county administrator.
The process now will include creating a five-year capital maintenance plan to stay on top of building needs, and allocating $750,000 a year in the Division of Transportation’s annual budget to replace snowplows and other equipment, subject to County Board approval.
The County Board last November approved a smaller, $250 million 2013 budget, which was a $6.7 million decrease from the 2012 budget. McHenry County government, one of three Illinois counties with a Aaa bond rating from Moody’s Investors Service, has been trimming its budget in recent years to adjust for the weak economy.
But not every County Board member thinks that holding the levy flat is enough. John Hammerand, who almost always votes against spending increases, said the county needs to cut its revenues, not just its expenses.
“If we ran for election on the campaign issue that we’re going to reduce taxes, that’s different from just holding the levy flat,” said Hammerand, R-Wonder Lake.