Waukegan property taxpayers will see little change in the tax bill they receive from Lake County next year.
The Waukegan City Council unanimously approved the 2021 real estate levy impacting property taxes and payable next year, reducing the levy 0.43% during a regularly scheduled meeting Monday at City Hall.
Cutting $87,037 from the 2020 levy approved a year ago, the 2021 amount is just under $37.3 million, with approximately $16.7 million going to police and fire pensions, along with just over $7.9 million paying the interest and principal on outstanding bonds.
With taxes cut by a tiny fraction, Don Schultz, the city’s interim finance director, said taxpayers are not likely to see a significant change from the real estate taxes they paid this year.
Waukegan Mayor Ann Taylor said after the meeting part of her goal was to not add to the tax burden on property owners. Raising taxes to balance a budget is not part of her philosophy of governing.
“I’m trying to give taxpayers a break after what we’ve been through with COVID,” Taylor said. “I’ve never believed in all the tax hikes we’ve done. We’re trying to work within our budget and be more efficient.”
Taylor said the way to generate more revenue is through economic development, bringing businesses and new residents to town as a result.
An example of future development, Taylor said earlier this year she wants to see is a multiuse project on the block the city fully acquired earlier this fall bounded by Sheridan Road, Washington Street, Genesee Street and Water Street.
When that property is developed by private entities, Taylor said she envisions projects with retail business, restaurants and possibly a boutique hotel. As that happens, tax revenue will flow into the city’s treasury without adding to residents’ property tax bills
“We’re trying to increase our revenue and work on getting more economic development,” she said. “With more economic development, we’ll have more property tax, more sales tax (and) more people paying into the system.”
Taxes account for approximately 57% of the city’s revenue, according to city documents. Property taxes provide a third of the city’s overall revenue, sales taxes add 18% and the municipal share of income taxes sent from the state another 6%. Projected revenue for the current fiscal year is about $178.4 million.
Taylor said after the meeting other sources of revenue include permit fees and taxes from video gaming. Money received from video gaming has increased, as those businesses are now fully open. They were closed for an extended period because of the coronavirus pandemic.
Over the summer, the city grappled with a potential $8.5 million deficit in its budget for the current fiscal year, which ends May 30. After reducing some expenditures, the shortfall was cut to $3.45 million. The difference was funded from the $19.7 million the city received from the federal government as part of its COVID recovery plan.
Realizing the community is experiencing more inflation than it has in past years, Taylor said the city is already working on its budget for the next fiscal year, which starts May 1. Finding a way to balance it without increasing taxes has gone from a goal to a reality.
“We’ve made the decisions, and we’ll do our budget accordingly,” she said. “We are in the process of doing our budget now. We’ll take all that into account, (including) inflation. I think we can do it without going to the taxpayers for more money.”
Along with pensions and debt service, $5.3 million of the tax money is spent to collect garbage, $4.6 million is slated for the Waukegan Public Library and just over $1.4 million for the pensions of the other municipal employees. Seed money for capital improvements like street resurfacing will get $1 million.
