WOODSTOCK – McHenry County staff tentatively will start preparing a 2015 budget that again keeps the property tax levy flat and rejects the inflationary increase it is entitled to under the tax cap.
But it also will develop a proposed set of guidelines to help the County Board decide in future years whether or not to take it.
County Board members gave the direction to staff at a Committee of the Whole meeting Friday, which the board convenes each spring before work starts in earnest on the following year's budget. A formal vote to adopt the process and assumptions by which the 2015 budget will be developed likely will take place next month.
If the County Board holds firm, 2015 will be the third consecutive year that it has chosen not to increase the levy, recognizing the need to hold the line on taxes on behalf of struggling taxpayers.
It's on that note that staff proposed developing guidelines to determine when collecting an increase would be justified.
"Could we create a policy on this issue other than a subjective political decision you all have to bear? I don't envy you for that," County Administrator Peter Austin asked board members.
The tax cap law, which was meant to limit runaway property tax bills by limiting annual levy increases to the rate of inflation, had an unforeseen effect when property values started falling. When they decline, a scenario lawmakers never considered, the tax cap helps governments by ensuring that they can collect the inflationary rate if they so choose. Irate taxpayers discovered that their tax bills were staying the same or increasing despite the fact that home values had plummeted with the bursting of the housing bubble.
The rate of inflation for 2014 that governments will be able to apply to next year's tax levies is 1.5 percent, according to the Illinois Department of Revenue.
County Board members were split on the idea of creating parameters for future years. While those open to the concept proposed such markers as the rise or fall of assessed value and the state of the county's reserves, others expressed concerns that the policy could create a mindset of justifying the need for more taxes rather than keeping spending low.
"The whole idea of saying, 'I'm going to build a case as to [increasing the levy]' conflicts with my thought, which is how to keep things down," said member Yvonne Barnes, R-Cary.
Staff also received direction to factor wage increases for non-union staff into next year's budget. County Board members have expressed concerns in recent years that freezing staff wages while union employees get raises set by contract will encourage them to unionize. The County Board froze non-union wages in 2011. Just less than half of the county's workforce is unionized under 10 separate bargaining units.
"When we don't give a raise, and the union comes a-knocking ...," said County Board Chairwoman Tina Hill, R-Woodstock.
County government makes up only about 10 percent of a homeowner's tax bill, with school districts typically making up the largest share. The county's fiscal year starts Dec. 1. The County Board's levy and budget usually go on 30-day review in October, the month before the Nov. 4 election in which 12 of the board's 24 seats are open.