The Oak Lawn Village Board unanimously approved a $207.8 million budget for next year which includes an increase in water rates.
About $75 million of the budget approved Tuesday is for the water department, which besides maintaining the pipes and providing water to Oak Lawn residents sells water to other communities.
Oak Lawn is raising the water rates for residents to address an operating deficit, the staff reported. Effective Jan. 1, the cost will go up from $6.77 to $7 per thousand gallons for the first 9,000 gallons a home uses. That’s a 3.3% increase.
For 9,001 gallons to 30,000 gallons used in a quarter, the cost will rise 7 % from $6.87 per thousand gallons to $7.35 per thousand gallons.
Anyone using more than that in a three-month period, will pay $7.70 per thousand gallons, up from $6.97, for water use above 30,000 gallons. The minimum quarterly charge for residents also will go up from $60.93 to $63.
Oak Lawn will adjust the rates it charges other towns for water, based on a review of its water service agreements.
The village gets the water it sells from Chicago and expects the city to raise its water rates by 5% on June 1. Oak Lawn will pass along the increase at that time to all its water customers.
The 2023 budget allocates $24.8 million for Police Department operations, which is nearly $1 million more than what is expected to be spent this year; $6.18 million for police pensions; $20.6 million for the Fire Department, which would be $794,000 more than the projected 2022 expenses; and $5.56 million for firefighter pensions.
In 2022, the village budgeted $446,800 for police overtime, but is on pace to spend nearly double that, $870,694, by year’s end, due to officers having an on-the-job injury, being on family medical leave or covering protests or other events.
The 2023 budget has $658,500 for police overtime.
Because the income tax and sales tax collected in 2022 exceeded what was budgeted, village officials said they had extra money to contribute to the police and firefighter pensions this year, above and beyond what the state requires.
The village expects it’s share of the state income tax will reach nearly $8.8 million by the end of this year, which would be nearly $2 million or 29% more than the $6.8 million budgeted.
Village officials used this year’s surplus in sales and state income tax to increase their pension contributions by $2 million. The village put an additional $1 million for a total of $6.8 million in the police pension fund and added $960,000 for a total of $6.25 million to the firefighters’ pension.
Village Trustee Alex Olejniczak said the board wants to show the police force and firefighters that the village appreciates the important work they do.
“We … are putting $2 million more than we are required to show the faith and our dedication to our people who take care of us everyday,” Olejniczak said. “We are making sure we fund their pension to make sure they have what they worked a lifetime for, that they can look forward to that.”
Anticipating a recession in 2023, village officials do not expect to receive as much income tax next year and budgeted $6,986,344 for Oak Lawn’s share of the state income tax revenue, which is $1.8 million less than the total expected in 2022.
Likewise, they are conservative in their estimate of sales tax.
The village expects to receive $23.6 million in sales tax this year, which would be 6% more than budgeted for 2022, but have $22.6 million of sales tax in the 2023 budget.
Village officials also do not think revenue from real estate transfer taxes will match that of 2022. They budgeted $1 million in transfer tax from the sale of property this year, but that revenue nearly doubled, to an expected $1.9 million by year’s end.
However, the village has experienced a slowdown in real estate transfers made in the second half of 2022, Village Manager Thomas Phelan said in an email.
“We are expecting this trend to continue into 2023 as the mortgage loan rates have almost doubled since this time last year,” Phelan wrote.
Still, board member Olejniczak called the plan “a very robust budget” that met the goal of not increasing property taxes and upgrading aging infrastructure, such as sewer replacements and more than $6 million for street resurfacing.
Oak Lawn’s 2022 tax levy of $20.1 million, which generates property taxes paid in 2023 and includes a $5.6 million levy for the public library, is only $110,148 more than the 2021 levy.
Olejniczak thanked the village staff for all its work “from an accounting side and a fiduciary side.”
Oak Lawn Mayor Terry Vorderer said the budget for 2023 was a “concerted effort . . . to do the best job to maintain the quality of our community and the services which we all learned to expect and, most importantly, to fund our Police and Fire department to the max we can.”
Kimberly Fornek is a freelance reporter for the Daily Southtown.
