Lakemoor to look at property tax increases, service cuts with home rule referendum on track to fail

More than 80% of voters said no to a referendum to make Lakemoor a home rule village, unofficial election results show, leading village officials to try and figure out what to do next to make up potential gaps.

The hope was to implement a 1% gas tax if the referendum passed and use that money to help fund the village’s police pension, Village Administrator Todd Weihofen said.

For the past 10 years, the village has been paying for its police pension obligations out of its general fund, which is funded by all types of taxes the village levies, Weihofen said. However, it’s expected that will soon not be enough to cover the costs.

The village currently owes about $700,000 annually on its police pension fund, and village officials expect that to increase in the coming years, Weihofen said.

Weihofen said Lakemoor has several gas stations in town and that the gas tax would have created about $600,000 in revenue.

“The gas tax would have made the whole thing work,” he said.

But voters, so far, have rejected the referendum with 103 in favor and 494 opposed, according to unofficial results from Lake and McHenry counties as of Wednesday. The results will be finalized April 25.

Weihofen pointed to Springfield-based Realtors in Opposition to Home Rule as the reason the referendum is failing, saying it used scare tactics to get people to not support home rule.

The group sent out mailers in Lakemoor and Wauconda, which also sought home rule authority this April, and created a website to urge voters to vote against the measure.

Home rule status would give “unchecked power to elected officials” and allow them to raise property taxes without approval, the group said in its website.

With the referendum on track to not pass, the village will remain limited in its ability to levy fees and taxes to help make up any budgetary differences, Weihofen said.

To help pay for those costs, the village now will look at property taxes as an option, Weihofen said.

If people didn’t want to vote on something that wouldn’t directly affect their property tax, I don’t think they’d vote for a direct increase.

—  Lakemoor Village Administrator Todd Weihofen on a possible property tax referendum

However, being non-home rule, Lakemoor is required to get residential approval before it can raise property taxes beyond the limit set by state law.

Even if the village went to voters again, Weihofen said the village is not confident such a measure would pass, given the results of the home rule vote.

“If people didn’t want to vote on something that wouldn’t directly affect their property tax, I don’t think they’d vote for a direct increase,” he said.

As a result, the village may have to start cutting costs, he said. Issuing municipal bonds is an option too, but all options will have to be looked at by the Village Board.

“Our hands are tied,” Weihofen said.

Going forward, Weihofen said he would like to see the state pass what he called a middle ground for home rule. That is, something that allows non-home rule municipalities to find other avenues to pay for things, but restricts them from raising property taxes.

“What’s popular isn’t easy, and what’s easy isn’t popular,” he said.