Here’s what your DeKalb city property tax bill could look like with 2022 proposed tax levy

DeKALB – A 2022 property tax levy greenlit by the DeKalb City Council this week would allow for no increase in the city’s share of the tax burden imposed on homeowners and property owners.

At Monday’s meeting, DeKalb city leaders directed city staff to move ahead with plans to place the levy into the city’s budget for 2023. A final budget has not yet been presented to the council or voted on yet for fiscal year 2023.

When faced with three tax levy options, the DeKalb City Council on Monday backed a proposal that would contain no property tax rate increase for DeKalb homeowners this year compared to the 2021 rate. The proposed rate of 0.92% is less than the city’s 0.98% rate in 2021. The 2021 rate also saw a lowered property tax rate for city residents, as city leaders accounted for significantly increase tax revenue stemming from major developments on the south side, including the Meta DeKalb Data Center, Amazon and Ferrara Candy Company.

City Manager Bill Nicklas made his pitch to the council, recommending that it back the levy without the projected tax increase.

“We found out where we were with our aggregate rate and it was too high and it’s hurting us,” Nicklas said.

The city’s aggregate levy has been higher than neighboring communities of St. Charles, Geneva, Elgin, Batavia, South Elgin, North Aurora and East Dundee in many cases, according to city documents.

“We’re paying 50% sometimes more of the property tax that would otherwise be owed by many of the new companies coming in to invite them here,” he said. “That’s the price of decades of charging too much in terms of property tax.”

The new equalized assessed valuation for properties is not yet known, according to city officials. But the county supervisor of assessment is projecting that the city’s equalized assessed valuation would amount to $768,500,000 with a 0.92% tax rate.

City estimates show the city is projected to collected $7.1 million in property tax revenue from its proposed 0.92% rate, assuming the proposed cumulative property value is set. That’s an increase of about 4%, or $273,813 more than the city collected last year, documents show.

“There’s a lot of spitballing that happens,” Nicklas said. “And you can try to be conservative.”

According to city projections, homeowners with a home valued at $300,000 and the proposed 0.92% rate would pay $1,002 to the city property tax, compared to a $997 tax bill in 2021 and $1,063 tax bill in 2020.

Nicklas said another issue the city is grappling deals with the state’s pension system. According to city documents, revenue collected from the city’s property tax levy has for years been exclusively used to pay down its police and fire pension debt.

“By 2040, 90% of all of our funds – police and fire – have to be funded 90%,” he said. “Many of them are in our own, I’d say, the high 40s in terms of funding, which is fine. No cataclysm is likely to cause all of that to be paid out at any one time.”

Nicklas, noting that the issue doesn’t rest with first responders, said they’re paying into the system as it’s been designed.

He acknowledged that state lawmakers have taken some steps to correct the pension system but they’ve not gone far enough.

Nicklas said something has to give.

“Every dollar of the property tax that comes into the city of DeKalb based on past levies, every dollar goes into the downstate pensions, plus this year what we’re going to have to spend is over $1.7 million dollars in additional sales and use taxes or whatever else is in the general fund pot,” Nicklas said. “It’s insupportable.”

The City Council is expected to weigh in on the budget in the coming weeks, with a December deadline set.