Metro-East News

Property taxes outpace income growth amid financing changes

Maps highlighting changes in estimated income and median property tax in the metro-east from 2009 to 2013, adjusted for 2014.
Maps highlighting changes in estimated income and median property tax in the metro-east from 2009 to 2013, adjusted for 2014. Source: Illinois Department of Revenue

Taxpayers in the metro-east saw their property taxes rise faster than their incomes from 2009-2013.

Using census data and figures from the Illinois Department of Revenue, the Belleville News-Democrat found that:

▪  St. Clair County saw median property taxes, adjusted for 2014 dollars, increase 34 percent over the five-year period

▪  Bond County: 24 percent

▪  Clinton County: 23 percent

▪  Randolph County: 23 percent

▪  Madison County: 20 percent

▪  Monroe County: 14 percent

During that same period, median household income, also adjusted for 2014 dollars, fell by 1 percent in St. Clair County. It fell in Bond County by 6 percent; 6 percent in Monroe County, and 3 percent in Madison County.

Clinton and Randolph counties were the only two in which median incomes rose, at 5 and 1 percent, respectively.

The Illinois Policy Institute, a think tank that promotes limited taxation, recently released a report that also looked at the disparity between property taxes and income growth. Using 1990 as a baseline, it showed that property taxes in Illinois have outpaced personal income growth three-to-one since then.

“Although all property owners ... are paying more in property taxes now than they were 20 years ago, even after adjusting for inflation, the overall tax burden has increasingly fallen more heavily on residential property owners,” the organization noted in its report.

The report points to the large number of taxing entities as one reason why property taxes have increased so rapidly. Illinois has the highest number of taxing districts in the nation, at 6,963, according to the U.S. Census of Government.

Schools are typically the largest beneficiaries of property taxes. For the past few years, St. Clair County schools have received about 61 percent of property taxes, according to county data. But schools are not the only taxing districts that share in overall property taxes. There also are cities, counties, townships, library districts, fire protection districts and a host of others, all of which need pieces of the property tax pie.

In general, property taxes in St. Clair County are “pretty stable,” said Treasurer Charles Suarez, despite an “occasional spike.” In 2013, a total of $332.2 million in property taxes were collected in all of St. Clair County.

Compounding the patchwork of taxes, the Illinois General Assembly passed the tax increment financing, or TIF, law in 1987, which allows cities and counties to create TIF districts and siphon off any growth in property tax revenue for development and infrastructure improvements within the district. Other taxing districts, mainly schools, argue that TIFs are unfair because they limit their own revenue growth, forcing many to seek other methods of raising money, such as tax rate increases or bond issues.

Overhead will be reduced, the number of highly paid executives and staff will be streamlined, and the overall burden borne by taxpayers will become more transparent (by decreasing the number of taxing districts).

Illinois Policy Institute

Jeff Dosier, superintendent of Belleville Township High School District 201, said that every time the school board votes to levy taxes, he asks, “What can we do to decrease the burden on homeowners?” But it has been more difficult since 2008, when the state started supporting schools less, he said.

The state is billions of dollars in debt and for years has been withholding the full allotment of dollars back to schools, hospitals, nursing homes and other entities. The state has been operating without a budget since last summer.

Part of the problem is predicting how much money a school district needs the coming year, Dosier said. School districts traditionally set tax levies in December for the following school year, but districts don’t know how much money the state will kick in each year until the summer before schools open. No one knows when the budget impasse in Illinois will be resolved, either.

Brian Mentzer, assistant superintendent of District 201, explained the complicated way the district levies taxes: First, the district sets a total amount, then the district extrapolates a tax rate based on that.

In 2009, District 201 levied a rate of 2.03 percent. In 2010, the district lowered the rate to 1.99 percent, and in 2011, the district lowered the rate again to 1.97, where it remained for three years. In 2014, the district raised the rate to 2.01 percent.

The Illinois Policy Institute recommended, among other things, cutting back on the number of taxing districts as a way to reduce property taxes.

By reducing the number of taxing districts, the policy institute reported, “Overhead will be reduced, the number of highly paid executives and staff will be streamlined, and the overall burden borne by taxpayers will become more transparent.”

Last year, Belleville Township officials voted to dissolve the township and stop collecting taxes. The township is still in the process of winding down.

Casey Bischel: 618-239-2655, @CaseyBischel

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