Lincoln approves $0 net increase in property taxes second consecutive year

[December 09, 2015]  LINCOLN - On Monday evening, the Lincoln City Council decided that for the second year in a row the city will hold the line on the dollars collected through property tax.

For the aldermen, this is a significant move, because they feel they are sending a message to Lincoln constituents that they have heard the concerns and are doing their part to help keep property taxes in check.

For the property owners some may still see increases based on the total assessment of their property, while others may see decreases or may see their taxes hold steady.

The city issues a request to the county that of the taxes collected for 2015 in 2016, the city will take a set dollar amount. The county then determines the percentage rate on the tax bill so the correct number of dollars will be billed and collected. Therefore, when constituents compare this year’s tax bill to next year’s, the percentage taken may differ between the two years, but the final net dollars to the city in total will not change.

The city will gain a few thousand dollars in their general fund from taxes next year while at the same time reducing a tax levy for bond payments.

The city levy’s taxes for a general obligation bond. This year the bond payment will drop by $13,010, according to city Treasurer Chuck Conzo. On Monday evening Conzo said that this decrease could open the door to taking an additional $13,010 in regular property tax without changing the overall amount collected on behalf of the city.

He also recommended that if the city did choose to levy the $13,000, that the dollars immediately be allocated to go toward the fire and police pension funds. If the city followed that recommendation, then the new money collected would have no impact on the daily operations of the city. It would, however, make some difference in the city’s effort to fully fund the two pension plans.

Conzo also told the council that they could opt to increase the general property tax according to the annual Consumer Price Index increase that is determined on a national level. This year the CPI allows for a 0.8 percent increase that would total $35,000. He said the council had the option to take that full amount or any portion of it.

During the discussion of the topic Jonie Tibbs asked Conzo what the city should do to “stay healthy,” asking if an increase is needed to help make ends meet? Conzo said that if the city chose not to increase its taxes this year, he did not believe it would have a detrimental effect on the city budget.

Later in the discussion, Steve Parrott asked a similar question. He wanted to know if the $13,010 that could be taken from the bond assessment and added to the general fund assessment would be significant for the city’s finances. Conzo said that all dollars acquired are significant, but what he was looking at was that if the dollars were not taken, it would not have a detrimental effect on the budget.

Because the city requests a set dollar figure, and the county determines how it will be billed to property owners, new construction and home improvements can impact the amount each taxpayer is required to pay. Trying to take that into consideration, Todd Mourning asked city Building and Safety Officer John Lebegue about new construction in 2015. Lebegue said that for this calendar year, there was only one new construction property that would impact the property taxes. Lebegue noted that in 2014 there were two new construction projects, and, in summary said new construction is down in the city.

Parrott confirmed that what the aldermen were talking about was holding their dollar amount request to the same figure as last year. He then wondered if the city could lower the net figure by $13,010 based on the reduced cost of the bond payment. Mourning said he felt like keeping the $13,000, and re-allocating it to the general fund would be the best thing for the city to do.

It was noted that Illinois Governor Bruce Rauner is pushing for a state-wide property tax freeze that could be in effect for the next two years. If that were to happen, the city would then not be able to take any CPI increases for the general fund during the freeze.
 

Michelle Bauer made the motion for a zero net increase in property taxes for 2015. When the vote was taken five aldermen - Bauer, Jeff Hoinacki, Kathy Horn, Mourning, and Tracy Welch voted ‘yes,' with Parrott and Tibbs voting ‘no.’ At the time of the vote, Marty Neitzel had already resigned as Ward 4 aldermen, and Rick Hoefle had not yet been appointed, so the seven aldermen represented the full council.

In a press release issued by City Administrator Clay Johnson on Tuesday morning, Welch was quoted as saying the following:

“I am pleased that as a result of good management of finances and long-term planning the City Council was able to approve a zero percent increase in the tax levy for a second year in a row. I feel that holding the tax levy at the current rate is the right thing to do for the taxpayers.”

Mayor Neitzel is also quoted as saying “The City Council wanted to send a clear message to our residents and business community, even in the face of state budget uncertainty, that the city of Lincoln is conscientious of everyone’s financial needs.”

Click here for complete press release

The final outcome of the vote is that the city will require $1,812,175 in taxes collected this year.  See table below

[Nila Smith]   

The tax dollars collected will be utilized in the following manner:
 

Corporate fund	$            52,535.
IMRF	137,006.
Fire Protection	125,902.
Firemen Pension	443,928.
Firemen Spouse	771.
Police Protection	59,809.
Police Pension	486,074.
Audit	17,470.
Tort Judgements	126,742.
Street/Bridge	100.
Public Benefit	47,010.
Emergency Service District	4,064.
Social Security	90.010.
School Crossing Guards	6,604.
Forestry Program	48,705.
Total Corporate and Special Purpose funds	$       1,646,730.
Bonds	165,445.
Total	$       1,812,175.