Park Forest Considering a Hefty 0.3% Percent Tax Levy Decrease

Park Forest, IL-(ENEWSPF)- If it passes, it will be first tax levy decrease in the 26 years, and quite a record to beat for whoever takes the gavel after Mayor John Ostenburg. While there are recommended budgetary increases, the Deputy Village Manager and Finance Director Mark Pries recommends a 0% (zero percent) increase in the 2018 tax levy for General Corporate and a 0.3% tax levy decrease in the extended tax levy for the fiscal year 2019-2020 budget.

This is no sleight-of-hand or pay-no-attention-to-that-man-behind-the-curtain moment. The 0% tax levy increase is made possible in no small part because of the closing of the Park Forest Health Department.

Property taxes for individuals individual will likely still rise as school district taxes will rise, but the dollar amount the Village levies will fall. 

Budgetary increases in General Corporate include the following:

• Salaries for non-union personnel will increase 2.5% or $335,000.
• Health Insurance costs are projected to rise 10% or $185,000.
• Other expenditures, which include capital outlays, utilities, postage, legal, etc, are projected to increase 2% or $195,000.

Additional funds needed for operations, then, will be $715,000. This entire amount will come from the Village’s reserve funds, leaving a full 3.5 months in reserves.

Tax Levy: Bonds & Interest

For bonds and interest, the Village is able to abate $1,164,923 in TIF Debt. “This is the entire debt service of the TIF Fund for FY 19-20.  The only bonds the Village will levy for are the 2012B bonds which were issued to refinance an earlier bond issue that raised funds for capital improvement projects including the new fire station,” according to Director Pries’ memo to the board. The actual debt service for bonds and interest is $1,428,423, of which $263,500 will be funded by the bond levy. 

Tax Levy: Retirement & FICA

“The Village pays a designated percentage of salary for retirement benefits which is determined by the Illinois Municipal Retirement Fund. The 2018 rate is 11.78% and the 2019 rate will decrease considerably to 9.92%.  The 2018 IMRF levy will actually decrease since the rate for 2019 decreased and the amount removed from the IMRF levy will be moved to the FICA levy in order to better allocate levy dollars where they are needed,” Director Pries says in his memo to the board.

Tax Levy: Police & Fire Pensions

From Director Pries, “The levy amount for the Police and Fire pensions are actuarially determined. Police and Fire pension benefit legislation adopted by the State legislature adds to municipal pension costs as do Police and Fire disability pensions. The Police Pension Fund earned 4.68% investment return for Fiscal 2018, based on a 5-year “smoothed” (averaged) calculation. Actual earnings for FY 17-18 were 5.42%.

“The Fire Pension Fund had actual returns last year of 8.14%. However,the Fund’s actuarial report must average the returns over a 5-year period, so the “smoothed” return used for FY 17-18 is 5.92%.”

Tax Levy Decrease Summary

	Original	Extended	Proposed
	2017 Levy	2017 Levy	2018 Levy
General Corporate	$ 11,800,340	$12,097,410	$ 12,042,671
Bonds & Interest	254,875	265,580	263,500
IMRF	601,475	616,647	574,572
FICA	471,207	483,084	525,159
Police Pension	1,989,441	2,039,548	2,084,376
Fire Pension	1,307,269	1,340,200	1,352,191
Village Levy	$ 16,424,607	$16,842,469	$ 16,842,469
Library	2,102,087	2,155,070	2,102,087
Combined	$ 18,526,694	$ 18,997,539	$ 18,944,556
Decrease over Extended Levy:				0.3%

“The proposed decrease of 0.3% is the first tax levy decrease in over 26 years,” Mr. Pries says in his memo to the board. ” This decrease is a combination of a 0% increase to the Village levy and a 2.5% decrease to the Library levy. Presented in the levy calculation is the original and extended levy. Cook County adds a loss factor to the original levy to allow for uncollected taxes. Any change to the levy represents a change to the extended levy. This is the “Truth in Taxation” Statutory requirement.”

This matter will appear on the agendas of the Special Rules and Regular Board meetings of November 19, 2018, for Board consideration and adoption.

First reading of the 2018 Tax Levy is scheduled for November 26. A public hearing is required for the first Board meeting in December (if the levy increase is more than 5% above the previous year) with the final levy adopted at the regular meeting on December 10.