The Elburn Village Board discussed its taxing system at its Dec. 3 meeting, explaining the difference between what the village requests in its annual levy and what it actually receives from Kane County.
“It’s kind of like Christmas, because you don’t get everything you asked for,” said Elburn Finance Director Doug Elder.
Elder said the tax levy is what the village asks for to pay for the costs of running the village, but it only receives the amount given by the county, which could be different than what it requested.
The Village Board held what is called a “Truth in Taxation” hearing at the meeting, something that is required when the coming year’s property tax levy – the “ask” - is more than 5 percent higher than the current year’s extension – the “get.”
Last year, the village asked for approximately $1 million. The extension, or the amount that it received, was $795,000. This year, the village is asking for the same amount - about $1 million.
“We’re not asking for any more than we asked for last year,” said trustee Dave Gualdoni. “That’s what it costs us to do business.”
However, because the village's request is more than the 5 percent it received this year, the truth in taxation hearing was required. Elder estimates that next year, the village will end up receiving about $826,000 of the $1 million that it is asking for.
“It gets everybody confused,” Elder said. “It really comes out to be a $4 difference (from this year’s taxes to next year’s) on a $300,000 home.”
The amount that a homeowner of a $150,000 home will pay to the village in property taxes next year will be about $230. For a $300,000 home, the amount will be twice that, or $460.
Village Administrator John Nevenhoven said the amount a homeowner of a $300,000 home ends up paying to the village is a little more than $1 a day, and will support the services the village provides the residents, such as police protection, roads, parks and stormwater management.
Property taxes make up about 23 percent of the village’s revenues, and the village receives about 5 percent of a residents' total tax bill.
“So, when we don’t get the full amount, we have to take it out of other income sources,” Village President Jeff Walter said.
One of the ways the village is considering to help make up that difference is an increase in the sales tax, which is currently 7 percent. The board approved a resolution to place a sales tax referendum on the ballot for the spring, which will ask for a sales tax increase of 1 percent in four increments on most items sold within the village.
“We need to look for additional sources of revenue so we can continue to provide quality services,” said trustee Ken Anderson.
Another source of revenue the village receives is a portion of the income generated from video gaming at several local establishments. When the village first approved video gaming five years ago, the revenue in the first year was $810, Nevenhoven said. With five machines at Schmidt’s Towne Tap, Knucklehead’s and Elsie’s Place, the village currently receives $30,000.