Board Approves 2.62 Percent Tax Levy Increase

Monday night, village trustees unanimously approved the 2011 tax levy, which is $7,660,832 and represents a 2.62 percent increase relative to the .

“We increased the request by 1.5 percent over the prior year’s extension, because the consumer price index increased by that amount,” said Finance Director Al Zochowski. “We are also asking for a 1.1 percent increase due to new construction, which added an equalized assessed valuation of approximately $12 million.”

The increase is $195,472 more than last year’s extension and will help to fund village operations, special recreation and cover a portion of the village’s debt service.

The percentages were based on an estimated total equalized assessed valuation of nearly $884.3 million, which includes all real estate parcels located within village boundaries.

The levy request is divided between corporate purposes, special recreation and payment on debt.

Corporate purposes represents $6.4 million; $180,000 will go towards special recreation and $1 million will be used for debt service.

Funding requests also were made by the Lake Zurich Firefighters and Lake Zurich Police Pension Boards, which are both included in the tax levy.

The firefighters pension board requested $1.8 million based on an outside actuary that board hired. The village uses a different actuary, who calculated $1.4 million as the appropriate allocation, and is the amount the board approved. The difference between the two figures is $365,219.

The police pension board requested $1.1 million, which was granted. The police pension board and the village used the same actuary to determine required pension contributions for the 2011 tax levy.

The public safety pension levy of $2.6 million is an increase of $122,559 over last year.

Trustees also approved seven additional abatement ordinances relating to bonds issued for the tax increment financing district as well as the water and sewer fund.

The seven general obligation alternate revenue bonds include five TIF bonds and two water and sewer bonds.

Since revenue from the TIF and the water and sewer fund is sufficient to pay the debt service on the bonds, the village will not seek property taxes to fund either one, which is why trustees approved the abatement ordinances.

Tax levy requests are subject to the Property Tax Extension Limitation Law, which requires that increases in the tax levy compared to the previous year be limited to the lesser of 5 percent or the annual consumer price index.

Special recreation and debt service are the only parts of the tax levy that are not subject to the Property Tax Extension Limitation Law.

Each year, the village is required to approve a tax levy ordinance so that the Lake County Clerk’s Office will extend property taxes on village real estate parcels.

The levy request this year, as in years past, is based on the equalized assessed valuation of all village properties.

Now that the 2011 tax levy has been approved, the finance department will prepare to file it with the Lake County clerk by Dec. 27.